TITAN 2020-21 Annual Report Analysis

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TITAN 2020-21 Annual Report Analysis
Mon, 26 Jul

TITAN has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

TITAN Income Statement Analysis

  • Operating income during the year rose 2.8% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 30.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 8.0% in FY21 as against 11.7% in FY20.
  • Depreciation charges increased by 7.8% and finance costs increased by 22.3% YoY, respectively.
  • Other income grew by 22.2% YoY.
  • Net profit for the year declined by 34.6% YoY.
  • Net profit margins during the year declined from 7.1% in FY20 to 4.5% in FY21.

TITAN Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 210,520 216,440 2.8%
Other income Rs m 1,530 1,870 22.2%
Total Revenues Rs m 212,050 218,310 3.0%
Gross profit Rs m 24,670 17,230 -30.2%
Depreciation Rs m 3,480 3,750 7.8%
Interest Rs m 1,660 2,030 22.3%
Profit before tax Rs m 21,060 13,320 -36.8%
Tax Rs m 6,090 3,530 -42.0%
Profit after tax Rs m 14,970 9,790 -34.6%
Gross profit margin % 11.7 8.0
Effective tax rate % 28.9 26.5
Net profit margin % 7.1 4.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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TITAN Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 77 billion as compared to Rs 56 billion in FY20, thereby witnessing an increase of 37.1%.
  • Long-term debt down at Rs 90 million as compared to Rs 170 million during FY20, a fall of 47.1%.
  • Current assets rose 30% and stood at Rs 132 billion, while fixed assets fell 4% and stood at Rs 32 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 163 billion as against Rs 134 billion during FY20, thereby witnessing a growth of 22%.

TITAN Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 66,650 74,930 12.4
 
Current Liabilities Rs m 56,280 77,140 37.1
Long-term Debt Rs m 170 90 -47.1
Total Liabilities Rs m 133,910 163,470 22.1
 
Current assets Rs m 101,210 131,970 30.4
Fixed Assets Rs m 32,700 31,500 -3.7
Total Assets Rs m 133,910 163,470 22.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



TITAN Cash Flow Statement Analysis

  • TITAN's cash flow from operating activities (CFO) during FY21 stood at Rs 41 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -28 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -12 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 1 billion from the Rs -4 billion net cash flows seen during FY20.

TITAN Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m -3,480 41,390 -
Cash Flow from Investing Activities Rs m 2,350 -28,010 -
Cash Flow from Financing Activities Rs m -2,420 -12,340 -
Net Cash Flow Rs m -3,550 1,060 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for TITAN

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.0, an decline from the EPS of Rs 16.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,722.0, stands at 156.2 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 14.4 times, while the price to sales ratio stands at 5.0 times.
  • The company's price to cash flow (P/CF) ratio stood at 112.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 237.1 243.8
TTM Earnings per share Rs 16.9 11.0
Diluted earnings per share Rs 16.9 11.0
Price to Cash Flow x 82.9 112.9
TTM P/E ratio x 156.2 156.2
Price / Book Value ratio x 14.1 14.4
Market Cap Rs m 1,528,792 1,528,768
Dividends per share (Unadj.) Rs 4.0 4.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for TITAN

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY21, from 1.8x during FY20. 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 7.6x during FY21, from 13.7x during FY20. 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 13.1% during FY21, from 22.5% during FY21. 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 20.5% during FY21, from 34.0% during FY20. 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 7.2% during FY21, from 12.4% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 1.8 1.7
Debtors’ Days Days 1 1
Interest coverage x 13.7 7.6
Debt to equity ratio x 0.0 0.0
Return on assets % 12.4 7.2
Return on equity % 22.5 13.1
Return on capital employed % 34.0 20.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

TITAN Share Price Performance

Over the last one year, TITAN share price has moved up from Rs 1,057.6 to Rs 1,722.0, registering a gain of Rs 664.4 or around 62.8%.

Overall, the S&P BSE SENSEX is up 39.6% over the year.

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

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