STERLITE TECH 2022-23 Annual Report Analysis

Wed, 19 Jul

STERLITE TECH 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.

STERLITE TECH Income Statement Analysis

• Operating income during the year rose 27.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 30.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 12.9% in FY23 as against 12.6% in FY22.
• Depreciation charges increased by 0.7% and finance costs increased by 30.7% YoY, respectively.
• Other income declined by 29.3% YoY.
• Net profit for the year grew by 57.1% YoY.
• Net profit margins during the year grew from 2.7% in FY22 to 3.3% in FY23.

STERLITE TECH Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	54,370	69,250	27.4%
Other income	Rs m	580	410	-29.3%
Total Revenues	Rs m	54,950	69,660	26.8%
Gross profit	Rs m	6,860	8,940	30.3%
Depreciation	Rs m	3,070	3,090	0.7%
Interest	Rs m	2,380	3,110	30.7%
Profit before tax	Rs m	1,990	3,150	58.3%
Tax	Rs m	520	840	61.5%
Profit after tax	Rs m	1,470	2,310	57.1%
Gross profit margin	%	12.6	12.9
Effective tax rate	%	26.1	26.7
Net profit margin	%	2.7	3.3

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STERLITE TECH Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 55 billion as compared to Rs 49 billion in FY22, thereby witnessing an increase of 13.0%.
• Long-term debt down at Rs 10 billion as compared to Rs 15 billion during FY22, a fall of 34.8%.
• Current assets rose 4% and stood at Rs 52 billion, while fixed assets fell 4% and stood at Rs 36 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 88 billion as against Rs 87 billion during FY22, thereby witnessing a growth of 1%.

STERLITE TECH Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	19,300	20,660	7.0
Current Liabilities	Rs m	48,910	55,290	13.0
Long-term Debt	Rs m	15,360	10,020	-34.8
Total Liabilities	Rs m	87,120	87,880	0.9
Current assets	Rs m	49,810	51,960	4.3
Fixed Assets	Rs m	37,310	35,820	-4.0
Total Assets	Rs m	87,120	87,880	0.9

STERLITE TECH Cash Flow Statement Analysis

• STERLITE TECH's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -570 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 390 million from the Rs 2 billion net cash flows seen during FY22.

STERLITE TECH 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	5,840	2,260	-61.3%
Cash Flow from Investing Activities	Rs m	-4,810	-570	-
Cash Flow from Financing Activities	Rs m	1,150	-1,320	-
Net Cash Flow	Rs m	2,180	390	-82.1%

Current Valuations for STERLITE TECH

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.8, an improvement from the EPS of Rs 3.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 151.8, stands at 36.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.9 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 13.7 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	136.7	173.8
TTM Earnings per share	Rs	3.7	5.8
Diluted earnings per share	Rs	3.7	5.8
Price to Cash Flow	x	19.7	13.7
TTM P/E ratio	x	86.9	36.7
Price / Book Value ratio	x	5.0	3.6
Market Cap	Rs m	97,039	74,021
Dividends per share (Unadj.)	Rs	0.5	1.0

Ratio Analysis for STERLITE TECH

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.9x during FY23, from 1.0x 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 improved and stood at 2.0x during FY23, from 1.8x 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 improved and stood at 11.2% during FY23, from 7.6% 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 improved and stood at 20.4% during FY23, from 12.6% 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 improved and stood at 6.2% during FY23, from 4.4% 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	1.0	0.9
Debtors’ Days	Days	11	10
Interest coverage	x	1.8	2.0
Debt to equity ratio	x	0.8	0.5
Return on assets	%	4.4	6.2
Return on equity	%	7.6	11.2
Return on capital employed	%	12.6	20.4

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

STERLITE TECH Share Price Performance

Over the last one year, STERLITE TECH share price has moved up from Rs 143.8 to Rs 151.8, registering a gain of Rs 8.0 or around 5.6%.

Overall, the S&P BSE SENSEX is up 22.7% over the year.

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