STOVEC INDUSTRIES 2022-23 Annual Report Analysis

Wed, 3 Apr

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

STOVEC INDUSTRIES Income Statement Analysis

• Operating income during the year fell 12.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 60.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.5% in CY23 as against 14.3% in CY22.
• Depreciation charges increased by 6.4% increased by 0.0% YoY, respectively.
• Other income declined by 4.0% YoY.
• Net profit for the year declined by 63.5% YoY.
• Net profit margins during the year declined from 10.5% in CY22 to 4.4% in CY23.

STOVEC INDUSTRIES Income Statement 2022-23

No. of Mths Year Ending		12 Dec-22*	12 Dec-23*	% Change
Net Sales	Rs m	2,358	2,073	-12.1%
Other income	Rs m	46	44	-4.0%
Total Revenues	Rs m	2,405	2,117	-12.0%
Gross profit	Rs m	338	134	-60.3%
Depreciation	Rs m	60	64	6.4%
Interest	Rs m	0	1	0.0%
Profit before tax	Rs m	324	114	-64.8%
Tax	Rs m	77	24	-69.0%
Profit after tax	Rs m	248	90	-63.5%
Gross profit margin	%	14.3	6.5
Effective tax rate	%	23.7	20.9
Net profit margin	%	10.5	4.4

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STOVEC INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during CY23 stood at Rs 459 million as compared to Rs 385 million in CY22, thereby witnessing an increase of 19.2%.
• Current assets fell 11% and stood at Rs 1 billion, while fixed assets fell 16% and stood at Rs 404 million in CY23.
• Overall, the total assets and liabilities for CY23 stood at Rs 2 billion as against Rs 2 billion during CY22, thereby witnessing a fall of 12%.

STOVEC INDUSTRIES Balance Sheet as on December 2023

No. of Mths Year Ending		12 Dec-22*	12 Dec-23*	% Change
Networth	Rs m	1,737	1,401	-19.4
Current Liabilities	Rs m	385	459	19.2
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	2,134	1,870	-12.4
Current assets	Rs m	1,652	1,466	-11.3
Fixed Assets	Rs m	482	404	-16.1
Total Assets	Rs m	2,134	1,870	-12.4

STOVEC INDUSTRIES Cash Flow Statement Analysis

• STOVEC INDUSTRIES's cash flow from operating activities (CFO) during CY23 stood at Rs 132 million on a YoY basis.
• Cash flow from investing activities (CFI) during CY23 stood at Rs 276 million on a YoY basis.
• Cash flow from financial activities (CFF) during CY23 stood at Rs -427 million on a YoY basis.
• Overall, net cash flows for the company during CY23 stood at Rs -18 million from the Rs 80 million net cash flows seen during CY22.

STOVEC INDUSTRIES Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Dec-22	Dec-23
Cash Flow from Operating Activities	Rs m	245	132	-46.1%
Cash Flow from Investing Activities	Rs m	-45	276	-
Cash Flow from Financing Activities	Rs m	-119	-427	-
Net Cash Flow	Rs m	80	-18	-

Current Valuations for STOVEC INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 43.2, an decline from the EPS of Rs 118.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,496.2, stands at 57.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.7 times, while the price to sales ratio stands at 2.5 times.
• The company's price to cash flow (P/CF) ratio stood at 30.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Dec-22*	12 Dec-23*
Sales per share (Unadj.)	Rs	1,128.5	991.7
TTM Earnings per share	Rs	118.5	43.2
Diluted earnings per share	Rs	118.6	43.3
Price to Cash Flow	x	15.6	30.6
TTM P/E ratio	x	19.4	57.7
Price / Book Value ratio	x	3.0	3.4
Market Cap	Rs m	5,220	4,708
Dividends per share (Unadj.)	Rs	47.0	174.0

Ratio Analysis for STOVEC INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 3.2x during CY23, from 4.3x during CY22. 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 130.8x during CY23, from 0.0x during CY22. 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 6.5% during CY23, from 14.3% during CY23. 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 8.2% during CY23, from 18.7% during CY22. 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 4.9% during CY23, from 11.6% during CY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Dec-22*	12 Dec-23*
Current ratio	x	4.3	3.2
Debtors’ Days	Days	36	55
Interest coverage	x	0.0	130.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.6	4.9
Return on equity	%	14.3	6.5
Return on capital employed	%	18.7	8.2

To see how STOVEC INDUSTRIES has performed over the last 5 years, please visit here.

STOVEC INDUSTRIES Share Price Performance

Over the last one year, STOVEC INDUSTRIES share price has moved down from Rs 2,141.8 to Rs 1,944.8, registering a loss of Rs 197.1 or around 9.2%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 34,369.7 (up 1.2%). Over the last one year it has moved up from 27,506.0 to 34,369.7, a gain of 6,864 points (up 25.0%).

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

(To know more, check out historical annual results for STOVEC INDUSTRIES and quarterly results for STOVEC INDUSTRIES)