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SONATA SOFTWARE 2018-19 Annual Report Analysis
Sun, 31 Mar

SONATA SOFTWARE 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.

SONATA SOFTWARE Income Statement Analysis

  • Operating income during the year rose 20.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 45.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 11.4% in FY19 as against 9.5% in FY18.
  • Depreciation charges increased by 2.7% and finance costs decreased by 29.5% YoY, respectively.
  • Other income declined by 40.0% YoY.
  • Net profit for the year grew by 29.5% YoY.
  • Net profit margins during the year grew from 7.8% in FY18 to 8.4% in FY19.

SONATA SOFTWARE Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 24,539 29,609 20.7%
Other income Rs m 455 273 -40.0%
Total Revenues Rs m 24,994 29,882 19.6%
Gross profit Rs m 2,321 3,384 45.8%
Depreciation Rs m 124 127 2.7%
Interest Rs m 48 34 -29.5%
Profit before tax Rs m 2,604 3,495 34.2%
Tax Rs m 682 1,006 47.4%
Profit after tax Rs m 1,921 2,489 29.5%
Gross profit margin % 9.5 11.4
Effective tax rate % 26.2 28.8
Net profit margin % 7.8 8.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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SONATA SOFTWARE Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 7 billion as compared to Rs 5 billion in FY18, thereby witnessing an increase of 30.8%.
  • Current assets rose 31% and stood at Rs 12 billion, while fixed assets rose 1% and stood at Rs 3 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 15 billion as against Rs 12 billion during FY18, thereby witnessing a growth of 24%.

SONATA SOFTWARE Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 6,533 7,660 17.3
 
Current Liabilities Rs m 5,478 7,163 30.8
Long-term Debt Rs m 187 0 -100.0
Total Liabilities Rs m 12,200 15,162 24.3
 
Current assets Rs m 9,525 12,468 30.9
Fixed Assets Rs m 2,674 2,694 0.7
Total Assets Rs m 12,200 15,162 24.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



SONATA SOFTWARE Cash Flow Statement Analysis

  • SONATA SOFTWARE's cash flow from operating activities (CFO) during FY19 stood at Rs -62 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs 113 million 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 -2 billion from the Rs 3 billion net cash flows seen during FY18.

SONATA SOFTWARE Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 2,896 -62 -
Cash Flow from Investing Activities Rs m 1,018 113 -88.9%
Cash Flow from Financing Activities Rs m -1,404 -1,660 -
Net Cash Flow Rs m 2,531 -1,597 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for SONATA SOFTWARE

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 24.0, an improvement from the EPS of Rs 18.5 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 338.2, stands at 14.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 4.6 times, while the price to sales ratio stands at 1.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 13.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 236.5 285.1
TTM Earnings per share Rs 18.5 24.0
Diluted earnings per share Rs 18.3 23.7
Price to Cash Flow x 16.1 13.8
TTM P/E ratio x 17.1 14.3
Price / Book Value ratio x 4.0 4.7
Market Cap Rs m 26,412 36,081
Dividends per share (Unadj.) Rs 10.5 12.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for SONATA SOFTWARE

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.7x during FY19, from 1.7x 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 improved and stood at 104.1x during FY19, from 55.1x 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 32.5% during FY19, from 29.4% 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 46.1% during FY19, from 39.5% 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 16.6% during FY19, from 16.1% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.7 1.7
Debtors’ Days Days 590 1,000
Interest coverage x 55.1 104.1
Debt to equity ratio x 0.0 0.0
Return on assets % 16.1 16.6
Return on equity % 29.4 32.5
Return on capital employed % 39.5 46.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

SONATA SOFTWARE Share Price Performance

Over the last one year, SONATA SOFTWARE share price has moved up from Rs 312.9 to Rs 338.2, registering a gain of Rs 25.4 or around 8.1%.

Meanwhile, the S&P BSE IT Index is trading at Rs 15,280.3 (up 0.4%). Over the last one year it has moved up from 12,100.6 to 15,280.3, a gain of 3,180 points (up 26.3%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Annual Report FAQs

What is the current share price of SONATA SOFTWARE?

SONATA SOFTWARE currently trades at Rs 744.2 per share. You can check out the latest share price performance of SONATA SOFTWARE here...

What was the revenue of SONATA SOFTWARE in FY19? How does it compare to earlier years?

The revenues of SONATA SOFTWARE stood at Rs 29,882 m in FY19, which was up 19.6% compared to Rs 24,994 m reported in FY18.

SONATA SOFTWARE's revenue has grown from Rs 19,843 m in FY16 to Rs 29,882 m in FY19.

Over the past 4 years, the revenue of SONATA SOFTWARE has grown at a CAGR of 14.6%.

What was the net profit of SONATA SOFTWARE in FY19? How does it compare to earlier years?

The net profit of SONATA SOFTWARE stood at Rs 2,489 m in FY19, which was up 29.5% compared to Rs 1,921 m reported in FY18.

This compares to a net profit of Rs 1,569 m in FY17 and a net profit of Rs 1,586 m in FY16.

Over the past 4 years, SONATA SOFTWARE net profit has grown at a CAGR of 16.2%.

What does the cash flow statement of SONATA SOFTWARE reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of SONATA SOFTWARE reveals:

  • Cash flow from operations decreased in FY19 and stood at Rs -62 m as compared to Rs 2,896 m in FY18.
  • Cash flow from investments decreased in FY19 and stood at Rs 113 m as compared to Rs 1,018 m in FY18.
  • Cash flow from financial activity decreased in FY19 and stood at Rs -1,660 m as compared to Rs -1,404 m in FY18.

Here's the cash flow statement of SONATA SOFTWARE for the past 4 years.

(Rs m)FY16FY17FY18FY19
From Operations1,5821,8452,896-62
From Investments-1,319-41,018113
From Financial Activity-296-1,728-1,404-1,660
Net Cashflow-43872,531-1,597

What does the Key Ratio analysis of SONATA SOFTWARE reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of SONATA SOFTWARE reveals:

  • Operating profit margins witnessed a fall and down at 11.4% in FY19 as against 9.5% in FY18.
  • Net profit margins grew from 7.8% in FY18 to 8.4% in FY19.
  • Debt to Equity ratio for FY19 stood at 0.0 as compared to 0.0 in FY18.

Here's the ratio/financial analysis of SONATA SOFTWARE for the past 4 years.

 FY16FY17FY18FY19
Operating Profit Margin (%)10.18.49.511.4
Net Profit Margin (%)8.26.67.88.4
Debt to Equity Ratio (x)0.10.10.00.0

Read: Latest Annual Report Analysis of SONATA SOFTWARE

 

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