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SWARAJ ENGINES 2017-18 Annual Report Analysis

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SWARAJ ENGINES 2017-18 Annual Report Analysis
Tue, 1 Jan

SWARAJ ENGINES has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

SWARAJ ENGINES Income Statement Analysis

  • Operating income during the year rose 15.8% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 16.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 15.8% in FY18 as against 15.7% in FY17.
  • Depreciation charges increased by 3.3% and finance costs increased by 4950.0% YoY, respectively.
  • Other income grew by 10.2% YoY.
  • Net profit for the year grew by 16.4% YoY.
  • Net profit margins during the year grew from 10.1% in FY17 to 10.1% in FY18.

SWARAJ ENGINES Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 6,662 7,712 15.8%
Other income Rs m 172 190 10.2%
Total Revenues Rs m 6,834 7,901 15.6%
Gross profit Rs m 1,046 1,216 16.3%
Depreciation Rs m 163 168 3.3%
Interest Rs m 0 10 4,950.0%
Profit before tax Rs m 1,055 1,227 16.4%
Tax Rs m 366 426 16.4%
Profit after tax Rs m 688 801 16.4%
Gross profit margin % 15.7 15.8
Effective tax rate % 34.7 34.7
Net profit margin % 10.1 10.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



SWARAJ ENGINES Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 1 billion as compared to Rs 796 million in FY17, thereby witnessing an increase of 37.7%.
  • Current assets fell 14% and stood at Rs 2 billion, while fixed assets rose 13% and stood at Rs 1 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 3 billion as against Rs 4 billion during FY17, thereby witnessing a fall of 7%.

SWARAJ ENGINES Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 2,834 2,285 -19.4
 
Current Liabilities Rs m 796 1,097 37.7
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 3,722 3,475 -6.6
 
Current assets Rs m 2,762 2,387 -13.6
Fixed Assets Rs m 959 1,088 13.4
Total Assets Rs m 3,722 3,475 -6.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



SWARAJ ENGINES Cash Flow Statement Analysis

  • SWARAJ ENGINES's cash flow from operating activities (CFO) during FY18 stood at Rs 893 million, an improvement of 8.5% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs 475 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -1 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 11 million from the Rs 13 million net cash flows seen during FY17.

SWARAJ ENGINES Cash Flow Statement 2017-18

Particulars No. of months 12 12 % Change
Year Ending Mar-17 Mar-18
Cash Flow from Operating Activities Rs m 823 893 8.5%
Cash Flow from Investing Activities Rs m -319 475 -
Cash Flow from Financing Activities Rs m -491 -1,357 -
Net Cash Flow Rs m 13 11 -16.5%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for SWARAJ ENGINES

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 66.0, an improvement from the EPS of Rs 55.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,505.0, stands at 21.9 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 10.5 times, while the price to sales ratio stands at 3.1 times.
  • The company's price to cash flow (P/CF) ratio stood at 18.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Sales per share (Unadj.) Rs 536.4 635.7
TTM Earnings per share Rs 55.4 66.0
Diluted earnings per share Rs 56.7 66.0
Price to Cash Flow x 22.0 18.8
TTM P/E ratio x 22.4 21.9
Price / Book Value ratio x 5.1 10.5
Market Cap Rs m 18,692 18,256
Dividends per share (Unadj.) Rs 43.0 50.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for SWARAJ ENGINES

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 2.2x during FY18, from 3.5x during FY17. 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 122.5x during FY18, from 5,274.0x during FY17. 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 35.1% during FY18, from 24.3% during FY18. 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 54.1% during FY18, from 37.2% during FY17. 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 23.3% during FY18, from 18.5% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Current ratio x 3.5 2.2
Debtors’ Days Days 7 7
Interest coverage x 5,274.0 122.5
Debt to equity ratio x 0.0 0.0
Return on assets % 18.5 23.3
Return on equity % 24.3 35.1
Return on capital employed % 37.2 54.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how SWARAJ ENGINES has performed over the last 5 years, please visit here.

SWARAJ ENGINES Share Price Performance

Over the last one year, SWARAJ ENGINES share price has moved up from Rs 2,052.5 to Rs 1,505.0, registering a loss of Rs 547.5 or around 26.7%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,818.1 (down 0.0%). Over the last one year it has moved down from 19,133.8 to 18,818.1, a loss of 316 points (down 1.6%).

Overall, the S&P BSE SENSEX is up 6.5% over the year.

(To know more, check out historical annual results for SWARAJ ENGINES and quarterly results for SWARAJ ENGINES)

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