SRF LTD 2018-19 Annual Report Analysis

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SRF LTD 2018-19 Annual Report Analysis
Fri, 18 Oct

SRF LTD has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

SRF LTD Income Statement Analysis

  • Operating income during the year rose 37.6% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 49.5% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 17.6% in FY19 as against 16.2% in FY18.
  • Depreciation charges increased by 16.2% and finance costs increased by 62.7% YoY, respectively.
  • Other income declined by 65.1% YoY.
  • Net profit for the year grew by 39.0% YoY.
  • Net profit margins during the year grew from 8.1% in FY18 to 8.3% in FY19.

SRF LTD Income Statement 2018-19

No. of Mths Year Ending12 Mar-18*12 Mar-19*% Change
Net SalesRs m55,89076,92737.6%
Other incomeRs m1,151401-65.1%
Total RevenuesRs m57,04277,32835.6%
Gross profitRs m9,06213,55249.5%
DepreciationRs m3,1583,66916.2%
InterestRs m1,2392,01662.7%
Profit before taxRs m5,8178,26942.2%
TaxRs m1,2001,85354.4%
Profit after taxRs m4,6176,41639.0%
Gross profit margin%16.217.6
Effective tax rate%20.622.4
Net profit margin%8.18.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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SRF LTD Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 32 billion as compared to Rs 25 billion in FY18, thereby witnessing an increase of 26.3%.
  • Long-term debt stood at Rs 22 billion as compared to Rs 19 billion during FY18, a growth of 13.3%.
  • Current assets rose 31% and stood at Rs 32 billion, while fixed assets rose 12% and stood at Rs 64 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 99 billion as against Rs 84 billion during FY18, thereby witnessing a growth of 18%.

SRF LTD Balance Sheet as on March 2019

No. of Mths Year Ending12 Mar-18*12 Mar-19*% Change
NetworthRs m35,64541,29315.8
 
Current LiabilitiesRs m25,32231,98726.3
Long-term DebtRs m19,07321,61313.3
Total LiabilitiesRs m83,63098,87918.2
 
Current assetsRs m24,25931,72330.8
Fixed AssetsRs m 56,80463,63012.0
Total AssetsRs m83,63098,87918.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



SRF LTD Cash Flow Statement Analysis

  • SRF LTD's cash flow from operating activities (CFO) during FY19 stood at Rs 9 billion, an improvement of 32.1% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -10 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 2 billion on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 1 billion from the Rs -6 million net cash flows seen during FY18.

SRF LTD Cash Flow Statement 2018-19

ParticularsNo. of months1212% Change
Year EndingMar-18Mar-19
Cash Flow from Operating ActivitiesRs m6,7808,95632.1%
Cash Flow from Investing ActivitiesRs m-11,953-10,142-
Cash Flow from Financing ActivitiesRs m4,9512,458-50.4%
Net Cash FlowRs m-61,025-
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for SRF LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 111.6, an improvement from the EPS of Rs 80.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 2,710.5, stands at 26.6 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.8 times, while the price to sales ratio stands at 1.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 18.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending12 Mar-18*12 Mar-19*
Sales per share (Unadj.)Rs973.41,338.3
TTM Earnings per shareRs80.4111.6
Diluted earnings per shareRs68.094.5
Price to Cash Flow x20.018.2
TTM P/E ratiox22.526.6
Price / Book Value ratiox2.82.8
Market CapRs m155,637184,016
Dividends per share (Unadj.)Rs12.012.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for SRF LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.0x during FY19, from 1.0x during FY18. 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 5.1x during FY19, from 5.7x during FY18. 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 improved and stood at 15.5% during FY19, from 13.0% during FY19. 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 improved and stood at 16.3% during FY19, from 12.9% during FY18. 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 improved and stood at 8.5% during FY19, from 7.0% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending12 Mar-18*12 Mar-19*
Current ratiox1.01.0
Debtors’ DaysDays4449
Interest coveragex5.75.1
Debt to equity ratiox0.50.5
Return on assets%7.08.5
Return on equity%13.015.5
Return on capital employed%12.916.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

SRF LTD Share Price Performance

Over the last one year, SRF LTD share price has moved up from Rs 1,749.6 to Rs 2,710.5, registering a gain of Rs 961.0 or around 54.9%.

Overall, the S&P BSE SENSEX is up 12.8% over the year.

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

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