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SUTLEJ TEXTILES 2022-23 Annual Report Analysis

Fri, 31 Mar

SUTLEJ TEXTILES has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

SUTLEJ TEXTILES Income Statement Analysis

• Operating income during the year fell 0.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 39.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.3% in FY23 as against 12.1% in FY22.
• Depreciation charges increased by 4.8% and finance costs increased by 16.4% YoY, respectively.
• Other income declined by 26.6% YoY.
• Net profit for the year declined by 75.2% YoY.
• Net profit margins during the year declined from 4.9% in FY22 to 1.2% in FY23.

SUTLEJ TEXTILES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	30,765	30,742	-0.1%
Other income	Rs m	357	262	-26.6%
Total Revenues	Rs m	31,122	31,005	-0.4%
Gross profit	Rs m	3,708	2,235	-39.7%
Depreciation	Rs m	1,210	1,269	4.8%
Interest	Rs m	498	579	16.4%
Profit before tax	Rs m	2,357	649	-72.5%
Tax	Rs m	855	277	-67.6%
Profit after tax	Rs m	1,502	373	-75.2%
Gross profit margin	%	12.1	7.3
Effective tax rate	%	36.3	42.6
Net profit margin	%	4.9	1.2

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SUTLEJ TEXTILES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 9 billion as compared to Rs 9 billion in FY22, thereby witnessing an increase of 7.2%.
• Long-term debt down at Rs 3 billion as compared to Rs 4 billion during FY22, a fall of 21.7%.
• Current assets rose 1% and stood at Rs 12 billion, while fixed assets fell 1% and stood at Rs 12 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 24 billion as against Rs 24 billion during FY22, thereby witnessing a growth of 0%.

SUTLEJ TEXTILES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	11,000	11,094	0.9
Current Liabilities	Rs m	8,590	9,211	7.2
Long-term Debt	Rs m	3,532	2,764	-21.7
Total Liabilities	Rs m	24,248	24,323	0.3
Current assets	Rs m	11,917	12,007	0.8
Fixed Assets	Rs m	12,331	12,203	-1.0
Total Assets	Rs m	24,248	24,323	0.3

SUTLEJ TEXTILES Cash Flow Statement Analysis

• SUTLEJ TEXTILES's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 106.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -1 billion, an improvement of 55.6% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -806 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -24 million from the Rs 10 million net cash flows seen during FY22.

SUTLEJ TEXTILES Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	950	1,959	106.1%
Cash Flow from Investing Activities	Rs m	-756	-1,176	-
Cash Flow from Financing Activities	Rs m	-184	-806	-
Net Cash Flow	Rs m	10	-24	-

Current Valuations for SUTLEJ TEXTILES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.3, an decline from the EPS of Rs 9.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 40.6, stands at 17.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.6 times, while the price to sales ratio stands at 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at 6.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	187.8	187.6
TTM Earnings per share	Rs	9.2	2.3
Diluted earnings per share	Rs	9.2	2.3
Price to Cash Flow	x	4.3	6.3
TTM P/E ratio	x	7.8	17.9
Price / Book Value ratio	x	1.1	0.9
Market Cap	Rs m	11,603	10,333
Dividends per share (Unadj.)	Rs	1.9	1.0

Ratio Analysis for SUTLEJ TEXTILES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY23, from 1.4x during FY22. 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 2.1x during FY23, from 5.7x during FY22. 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 3.4% during FY23, from 13.7% during FY23. 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 8.9% during FY23, from 19.6% during FY22. 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 3.9% during FY23, from 8.2% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	1.4	1.3
Debtors’ Days	Days	5	4
Interest coverage	x	5.7	2.1
Debt to equity ratio	x	0.3	0.2
Return on assets	%	8.2	3.9
Return on equity	%	13.7	3.4
Return on capital employed	%	19.6	8.9

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 down from Rs 71.2 to Rs 40.6, registering a loss of Rs 30.5 or around 42.9%.

Overall, the S&P BSE SENSEX is up 1.8% over the year.

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