SUMITOMO CHEMICAL INDIA 2022-23 Annual Report Analysis

Tue, 4 Jul

SUMITOMO CHEMICAL INDIA 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.

SUMITOMO CHEMICAL INDIA Income Statement Analysis

• Operating income during the year rose 14.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 11.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 19.0% in FY23 as against 19.6% in FY22.
• Depreciation charges increased by 15.7% and finance costs decreased by 22.3% YoY, respectively.
• Other income grew by 68.2% YoY.
• Net profit for the year grew by 18.9% YoY.
• Net profit margins during the year grew from 13.8% in FY22 to 14.3% in FY23.

SUMITOMO CHEMICAL INDIA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	30,646	35,110	14.6%
Other income	Rs m	268	451	68.2%
Total Revenues	Rs m	30,914	35,560	15.0%
Gross profit	Rs m	6,017	6,684	11.1%
Depreciation	Rs m	448	519	15.7%
Interest	Rs m	80	62	-22.3%
Profit before tax	Rs m	5,757	6,554	13.8%
Tax	Rs m	1,522	1,520	-0.1%
Profit after tax	Rs m	4,235	5,034	18.9%
Gross profit margin	%	19.6	19.0
Effective tax rate	%	26.4	23.2
Net profit margin	%	13.8	14.3

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SUMITOMO CHEMICAL INDIA Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 9 billion as compared to Rs 10 billion in FY22, thereby witnessing an decrease of -8.5%.
• Current assets rose 11% and stood at Rs 28 billion, while fixed assets rose 19% and stood at Rs 6 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 34 billion as against Rs 30 billion during FY22, thereby witnessing a growth of 12%.

SUMITOMO CHEMICAL INDIA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	19,272	23,799	23.5
Current Liabilities	Rs m	10,214	9,350	-8.5
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	30,096	33,688	11.9
Current assets	Rs m	25,220	27,875	10.5
Fixed Assets	Rs m	4,876	5,813	19.2
Total Assets	Rs m	30,096	33,688	11.9

SUMITOMO CHEMICAL INDIA Cash Flow Statement Analysis

• SUMITOMO CHEMICAL INDIA's cash flow from operating activities (CFO) during FY23 stood at Rs 4 billion, an improvement of 75.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -3 billion, an improvement of 12.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -725 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -102 million from the Rs -1 billion net cash flows seen during FY22.

SUMITOMO CHEMICAL INDIA 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	2,218	3,894	75.6%
Cash Flow from Investing Activities	Rs m	-2,902	-3,270	-
Cash Flow from Financing Activities	Rs m	-626	-725	-
Net Cash Flow	Rs m	-1,311	-102	-

Current Valuations for SUMITOMO CHEMICAL INDIA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.1, an improvement from the EPS of Rs 8.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 436.8, stands at 43.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.2 times, while the price to sales ratio stands at 6.2 times.
• The company's price to cash flow (P/CF) ratio stood at 42.1 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	61.4	70.3
TTM Earnings per share	Rs	8.5	10.1
Diluted earnings per share	Rs	8.5	10.1
Price to Cash Flow	x	47.9	42.1
TTM P/E ratio	x	53.0	43.4
Price / Book Value ratio	x	9.6	9.8
Market Cap	Rs m	184,272	233,675
Dividends per share (Unadj.)	Rs	1.0	1.2

Ratio Analysis for SUMITOMO CHEMICAL INDIA

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.0x during FY23, from 2.5x 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 106.8x during FY23, from 73.2x 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 21.2% during FY23, from 22.0% 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 27.8% during FY23, from 30.3% 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 15.1% during FY23, from 14.3% 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	2.5	3.0
Debtors’ Days	Days	100	98
Interest coverage	x	73.2	106.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	14.3	15.1
Return on equity	%	22.0	21.2
Return on capital employed	%	30.3	27.8

To see how SUMITOMO CHEMICAL INDIA has performed over the last 5 years, please visit here.

SUMITOMO CHEMICAL INDIA Share Price Performance

Over the last one year, SUMITOMO CHEMICAL INDIA share price has moved down from Rs 444.5 to Rs 436.8, registering a loss of Rs 7.7 or around 1.7%.

Overall, the S&P BSE SENSEX is up 23.0% over the year.

(To know more, check out historical annual results for SUMITOMO CHEMICAL INDIA and quarterly results for SUMITOMO CHEMICAL INDIA)