TATA MOTORS 2022-23 Annual Report Analysis

Wed, 14 Jun

TATA MOTORS 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.

TATA MOTORS Income Statement Analysis

• Operating income during the year rose 24.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 47.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 9.7% in FY23 as against 8.2% in FY22.
• Depreciation charges increased by 0.1% and finance costs increased by 9.8% YoY, respectively.
• Other income grew by 7.1% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 4.0% in FY22 to 0.7% in FY23.

TATA MOTORS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	2,784,536	3,459,670	24.2%
Other income	Rs m	44,242	47,371	7.1%
Total Revenues	Rs m	2,828,778	3,507,040	24.0%
Gross profit	Rs m	227,199	334,063	47.0%
Depreciation	Rs m	248,357	248,604	0.1%
Interest	Rs m	93,119	102,255	9.8%
Profit before tax	Rs m	-70,034	30,576	NA
Tax	Rs m	42,313	7,041	-83.4%
Profit after tax	Rs m	-112,347	23,535	NA
Gross profit margin	%	8.2	9.7
Effective tax rate	%	-60.4	23.0
Net profit margin	%	-4.0	0.7

Download Now: 7 Unstoppable Growth Engines of India's $10 Trillion Bull Run...

TATA MOTORS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 1,550 billion as compared to Rs 1,507 billion in FY22, thereby witnessing an increase of 2.9%.
• Long-term debt down at Rs 887 billion as compared to Rs 978 billion during FY22, a fall of 9.3%.
• Current assets rose 3% and stood at Rs 1,507 billion, while fixed assets fell 0% and stood at Rs 1,794 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 3,309 billion as against Rs 3,267 billion during FY22, thereby witnessing a growth of 1%.

TATA MOTORS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	445,166	452,561	1.7
Current Liabilities	Rs m	1,506,797	1,550,273	2.9
Long-term Debt	Rs m	977,592	886,958	-9.3
Total Liabilities	Rs m	3,267,491	3,308,967	1.3
Current assets	Rs m	1,464,537	1,507,007	2.9
Fixed Assets	Rs m	1,797,715	1,793,682	-0.2
Total Assets	Rs m	3,267,491	3,308,967	1.3

TATA MOTORS Cash Flow Statement Analysis

• TATA MOTORS's cash flow from operating activities (CFO) during FY23 stood at Rs 354 billion, an improvement of 147.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -168 billion, an improvement of 251.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -262 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -63 billion from the Rs 65 billion net cash flows seen during FY22.

TATA MOTORS 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	142,828	353,880	147.8%
Cash Flow from Investing Activities	Rs m	-47,751	-168,042	-
Cash Flow from Financing Activities	Rs m	-33,802	-262,429	-
Net Cash Flow	Rs m	64,590	-62,721	-

Current Valuations for TATA MOTORS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.1, an improvement from the EPS of Rs -29.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 567.1, stands at 80.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.2 times, while the price to sales ratio stands at 0.6 times.
• The company's price to cash flow (P/CF) ratio stood at 6.1 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	727.2	903.3
TTM Earnings per share	Rs	-29.3	6.1
Diluted earnings per share	Rs	-33.8	7.1
Price to Cash Flow	x	10.6	6.1
TTM P/E ratio	x	-12.8	80.0
Price / Book Value ratio	x	3.5	3.6
Market Cap	Rs m	1,541,239	1,647,888
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for TATA MOTORS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.0x 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 1.3x during FY23, from 0.2x 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 improved and stood at 5.2% during FY23, from -25.2% 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 9.9% during FY23, from 1.6% 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 3.8% during FY23, from -0.6% 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	1.0
Debtors’ Days	Days	2	2
Interest coverage	x	0.2	1.3
Debt to equity ratio	x	2.2	2.0
Return on assets	%	-0.6	3.8
Return on equity	%	-25.2	5.2
Return on capital employed	%	1.6	9.9

To see how TATA MOTORS has performed over the last 5 years, please visit here.

TATA MOTORS Share Price Performance

Over the last one year, TATA MOTORS share price has moved up from Rs 405.1 to Rs 567.1, registering a gain of Rs 162.0 or around 40.0%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 33,830.6 (up 0.0%). Over the last one year it has moved up from 25,298.0 to 33,830.6, a gain of 8,533 points (up 33.7%).

Overall, the S&P BSE SENSEX is up 19.3% over the year.

(To know more, check out historical annual results for TATA MOTORS and quarterly results for TATA MOTORS)