SUTLEJ TEXTILES 2020-21 Annual Report Analysis

Wed, 31 Mar

SUTLEJ TEXTILES 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.

SUTLEJ TEXTILES Income Statement Analysis

• Operating income during the year fell 22.0% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 37.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 5.5% in FY21 as against 6.9% in FY20.
• Depreciation charges decreased by 5.5% and finance costs decreased by 17.4% YoY, respectively.
• Other income grew by 22.7% YoY.
• Net profit for the year declined by 113.2% YoY.
• Net profit margins during the year declined from 1.1% in FY20 to 0.2% in FY21.

SUTLEJ TEXTILES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	24,167	18,840	-22.0%
Other income	Rs m	254	311	22.7%
Total Revenues	Rs m	24,420	19,152	-21.6%
Gross profit	Rs m	1,678	1,043	-37.8%
Depreciation	Rs m	1,011	956	-5.5%
Interest	Rs m	457	378	-17.4%
Profit before tax	Rs m	463	21	-95.5%
Tax	Rs m	186	57	-69.2%
Profit after tax	Rs m	277	-37	-113.2%
Gross profit margin	%	6.9	5.5
Effective tax rate	%	40.2	276.0
Net profit margin	%	1.1	-0.2

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SUTLEJ TEXTILES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 7 billion as compared to Rs 6 billion in FY20, thereby witnessing an increase of 7.8%.
• Long-term debt down at Rs 4 billion as compared to Rs 5 billion during FY20, a fall of 6.0%.
• Current assets rose 1% and stood at Rs 9 billion, while fixed assets rose 0% and stood at Rs 13 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 21 billion as against Rs 21 billion during FY20, thereby witnessing a growth of 1%.

SUTLEJ TEXTILES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	9,591	9,546	-0.5
Current Liabilities	Rs m	6,244	6,731	7.8
Long-term Debt	Rs m	4,696	4,412	-6.0
Total Liabilities	Rs m	21,248	21,386	0.7
Current assets	Rs m	8,702	8,789	1.0
Fixed Assets	Rs m	12,545	12,597	0.4
Total Assets	Rs m	21,248	21,386	0.7

SUTLEJ TEXTILES Cash Flow Statement Analysis

• SUTLEJ TEXTILES's cash flow from operating activities (CFO) during FY21 stood at Rs 887 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -915 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 34 million, an improvement of 103% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 6 million from the Rs 17 million net cash flows seen during FY20.

SUTLEJ TEXTILES 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	3,189	887	-72.2%
Cash Flow from Investing Activities	Rs m	-2,086	-915	-
Cash Flow from Financing Activities	Rs m	-1,086	34	-
Net Cash Flow	Rs m	17	6	-66.1%

Current Valuations for SUTLEJ TEXTILES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -0.2, an decline from the EPS of Rs 1.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 39.4, stands at -176.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at 6.2 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	147.5	115.0
TTM Earnings per share	Rs	1.7	-0.2
Diluted earnings per share	Rs	1.7	-0.2
Price to Cash Flow	x	2.5	6.2
TTM P/E ratio	x	11.6	-176.1
Price / Book Value ratio	x	0.5	0.6
Market Cap	Rs m	4,747	5,705
Dividends per share (Unadj.)	Rs	0.3	0.3

Ratio Analysis for SUTLEJ TEXTILES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY21, from 1.4x 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 2.0x 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 -0.4% during FY21, from 2.9% 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 2.9% during FY21, from 6.4% 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 1.6% during FY21, from 3.5% 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	1.4	1.3
Debtors’ Days	Days	4	5
Interest coverage	x	2.0	1.1
Debt to equity ratio	x	0.5	0.5
Return on assets	%	3.5	1.6
Return on equity	%	2.9	-0.4
Return on capital employed	%	6.4	2.9

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

SUTLEJ TEXTILES Share Price Performance

Over the last one year, SUTLEJ TEXTILES share price has moved up from Rs 19.6 to Rs 39.4, registering a gain of Rs 19.8 or around 101.3%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of SUTLEJ TEXTILES