SWARAJ ENGINES 2022-23 Annual Report Analysis

Sun, 9 Jul

SWARAJ ENGINES 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.

SWARAJ ENGINES Income Statement Analysis

• Operating income during the year rose 24.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 19.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 13.1% in FY23 as against 13.7% in FY22.
• Depreciation charges increased by 2.4% increased by 0.0% YoY, respectively.
• Other income grew by 32.7% YoY.
• Net profit for the year grew by 22.0% YoY.
• Net profit margins during the year declined from 9.6% in FY22 to 9.4% in FY23.

SWARAJ ENGINES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	11,382	14,218	24.9%
Other income	Rs m	97	128	32.7%
Total Revenues	Rs m	11,478	14,346	25.0%
Gross profit	Rs m	1,554	1,856	19.4%
Depreciation	Rs m	181	185	2.4%
Interest	Rs m	1	1	0.0%
Profit before tax	Rs m	1,469	1,797	22.4%
Tax	Rs m	374	461	23.4%
Profit after tax	Rs m	1,095	1,336	22.0%
Gross profit margin	%	13.7	13.1
Effective tax rate	%	25.5	25.7
Net profit margin	%	9.6	9.4

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SWARAJ ENGINES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 1 billion in FY22, thereby witnessing an increase of 24.6%.
• Current assets rose 19% and stood at Rs 4 billion, while fixed assets rose 10% and stood at Rs 1 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 5 billion as against Rs 5 billion during FY22, thereby witnessing a growth of 16%.

SWARAJ ENGINES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	3,055	3,421	12.0
Current Liabilities	Rs m	1,496	1,864	24.6
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	4,614	5,349	15.9
Current assets	Rs m	3,280	3,887	18.5
Fixed Assets	Rs m	1,334	1,462	9.5
Total Assets	Rs m	4,614	5,349	15.9

SWARAJ ENGINES Cash Flow Statement Analysis

• SWARAJ ENGINES's cash flow from operating activities (CFO) during FY23 stood at Rs 1 billion, an improvement of 32.5% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -376 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -973 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -21 million from the Rs -320 million net cash flows seen during FY22.

SWARAJ ENGINES 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	1,003	1,328	32.5%
Cash Flow from Investing Activities	Rs m	-484	-376	-
Cash Flow from Financing Activities	Rs m	-838	-973	-
Net Cash Flow	Rs m	-320	-21	-

Current Valuations for SWARAJ ENGINES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 110.0, an improvement from the EPS of Rs 90.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,126.9, stands at 19.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.6 times, while the price to sales ratio stands at 1.8 times.
• The company's price to cash flow (P/CF) ratio stood at 13.0 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	937.5	1,170.2
TTM Earnings per share	Rs	90.2	110.0
Diluted earnings per share	Rs	90.1	110.0
Price to Cash Flow	x	12.4	13.0
TTM P/E ratio	x	14.5	19.3
Price / Book Value ratio	x	6.5	5.8
Market Cap	Rs m	19,897	19,780
Dividends per share (Unadj.)	Rs	80.0	92.0

Ratio Analysis for SWARAJ ENGINES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.1x during FY23, from 2.2x 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 2,366.1x during FY23, from 1,933.4x 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 39.1% during FY23, from 35.8% 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 52.6% during FY23, from 48.1% 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 25.0% during FY23, from 23.7% 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	2.2	2.1
Debtors’ Days	Days	332	329
Interest coverage	x	1,933.4	2,366.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	23.7	25.0
Return on equity	%	35.8	39.1
Return on capital employed	%	48.1	52.6

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 1,489.2 to Rs 2,126.9, registering a gain of Rs 637.8 or around 42.8%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 40,670.4 (down 0.8%). Over the last one year it has moved up from 27,580.5 to 40,670.4, a gain of 13,090 points (up 47.5%).

Overall, the S&P BSE SENSEX is up 22.9% over the year.

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