SOBHA 2020-21 Annual Report Analysis

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SOBHA 2020-21 Annual Report Analysis
Tue, 19 Oct

SOBHA has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

SOBHA Income Statement Analysis

  • Operating income during the year fell 43.8% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 39.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 32.0% in FY21 as against 29.7% in FY20.
  • Depreciation charges increased by 9.8% and finance costs decreased by 11.8% YoY, respectively.
  • Other income grew by 12.3% YoY.
  • Net profit for the year declined by 77.9% YoY.
  • Net profit margins during the year declined from 7.4% in FY20 to 2.8% in FY21.

SOBHA Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 37,539 21,098 -43.8%
Other income Rs m 718 806 12.3%
Total Revenues Rs m 38,257 21,904 -42.7%
Gross profit Rs m 11,152 6,751 -39.5%
Depreciation Rs m 723 794 9.8%
Interest Rs m 6,816 6,012 -11.8%
Profit before tax Rs m 4,332 752 -82.6%
Tax Rs m 1,515 129 -91.5%
Profit after tax Rs m 2,817 623 -77.9%
Gross profit margin % 29.7 32.0
Effective tax rate % 35.0 17.2
Net profit margin % 7.4 2.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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SOBHA Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 84 billion as compared to Rs 83 billion in FY20, thereby witnessing an increase of 1.0%.
  • Long-term debt stood at Rs 4 billion as compared to Rs 2 billion during FY20, a growth of 47.4%.
  • Current assets rose 1% and stood at Rs 95 billion, while fixed assets rose 9% and stood at Rs 17 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 112 billion as against Rs 110 billion during FY20, thereby witnessing a growth of 2%.

SOBHA Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 24,312 24,277 -0.1
 
Current Liabilities Rs m 82,916 83,759 1.0
Long-term Debt Rs m 2,378 3,504 47.4
Total Liabilities Rs m 110,102 112,082 1.8
 
Current assets Rs m 94,167 94,766 0.6
Fixed Assets Rs m 15,935 17,317 8.7
Total Assets Rs m 110,102 112,082 1.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



SOBHA Cash Flow Statement Analysis

  • SOBHA's cash flow from operating activities (CFO) during FY21 stood at Rs 6 billion, an improvement of 108.2% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -332 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -5 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 962 million from the Rs -969 million net cash flows seen during FY20.

SOBHA Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m 2,944 6,128 108.2%
Cash Flow from Investing Activities Rs m -3,070 -332 -
Cash Flow from Financing Activities Rs m -844 -4,834 -
Net Cash Flow Rs m -969 962 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for SOBHA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.6, an decline from the EPS of Rs 29.7 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 812.5, stands at 115.9 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.2 times, while the price to sales ratio stands at 1.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 54.4 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 395.8 222.4
TTM Earnings per share Rs 29.7 6.6
Diluted earnings per share Rs 29.7 6.6
Price to Cash Flow x 21.8 54.4
TTM P/E ratio x 115.9 115.9
Price / Book Value ratio x 1.4 1.2
Market Cap Rs m 77,058 77,058
Dividends per share (Unadj.) Rs 7.0 3.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for SOBHA

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.1x during FY21, from 1.1x during FY20. The current ratio measures the company's ability to pay short-term and long-term obligations.

    Interest Coverage Ratio: The company's interest coverage ratio deteriorated and stood at 1.1x during FY21, from 1.6x during FY20. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

  • Profitability Ratios
  • Return on Equity (ROE): The ROE for the company declined and down at 2.6% during FY21, from 11.6% during FY21. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

    Return on Capital Employed (ROCE): The ROCE for the company declined and down at 24.3% during FY21, from 41.8% during FY20. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

    Return on Assets (ROA): The ROA of the company declined and down at 5.9% during FY21, from 8.7% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 1.1 1.1
Debtors’ Days Days 35 34
Interest coverage x 1.6 1.1
Debt to equity ratio x 0.1 0.1
Return on assets % 8.7 5.9
Return on equity % 11.6 2.6
Return on capital employed % 41.8 24.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how SOBHA has performed over the last 5 years, please visit here.

SOBHA Share Price Performance

Over the last one year, SOBHA share price has moved up from Rs 264.7 to Rs 812.5, registering a gain of Rs 547.8 or around 206.9%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 4,196.3 (down 2.7%). Over the last one year it has moved up from 1,722.7 to 4,196.3, a gain of 2,474 points (up 143.6%).

Overall, the S&P BSE SENSEX is up 51.9% over the year.

(To know more, check out historical annual results for SOBHA and quarterly results for SOBHA)

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