TRENT 2020-21 Annual Report Analysis

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TRENT 2020-21 Annual Report Analysis
Wed, 20 Oct

TRENT 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.

TRENT Income Statement Analysis

  • Operating income during the year fell 26.0% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 67.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.8% in FY21 as against 17.5% in FY20.
  • Depreciation charges increased by 4.1% and finance costs decreased by 1.0% YoY, respectively.
  • Other income grew by 34.9% YoY.
  • Net profit for the year declined by 180.5% YoY.
  • Net profit margins during the year declined from 4.1% in FY20 to 4.3% in FY21.

TRENT Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 31,825 23,544 -26.0%
Other income Rs m 1,494 2,016 34.9%
Total Revenues Rs m 33,320 25,560 -23.3%
Gross profit Rs m 5,566 1,830 -67.1%
Depreciation Rs m 2,472 2,573 4.1%
Interest Rs m 2,634 2,608 -1.0%
Profit before tax Rs m 1,954 -1,335 -168.3%
Tax Rs m 590 -237 -140.1%
Profit after tax Rs m 1,364 -1,098 -180.5%
Gross profit margin % 17.5 7.8
Effective tax rate % 30.2 17.8
Net profit margin % 4.1 -4.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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TRENT Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 8 billion as compared to Rs 5 billion in FY20, thereby witnessing an increase of 54.2%.
  • Current assets fell 18% and stood at Rs 14 billion, while fixed assets rose 14% and stood at Rs 42 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 56 billion as against Rs 54 billion during FY20, thereby witnessing a growth of 4%.

TRENT Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 23,878 23,130 -3.1
 
Current Liabilities Rs m 4,873 7,514 54.2
Long-term Debt Rs m 2,997 0 -100.0
Total Liabilities Rs m 53,963 56,092 3.9
 
Current assets Rs m 17,035 14,034 -17.6
Fixed Assets Rs m 36,928 42,059 13.9
Total Assets Rs m 53,963 56,092 3.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



TRENT Cash Flow Statement Analysis

  • TRENT's cash flow from operating activities (CFO) during FY21 stood at Rs 4 billion, an improvement of 3.5% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs 157 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -4 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 196 million from the Rs 45 million net cash flows seen during FY20.

TRENT 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 3,612 3,738 3.5%
Cash Flow from Investing Activities Rs m -8,156 157 -
Cash Flow from Financing Activities Rs m 4,519 -3,719 -
Net Cash Flow Rs m 45 196 332.4%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for TRENT

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs -3.1, an decline from the EPS of Rs 3.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,101.5, stands at -482.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 10.3 times, while the price to sales ratio stands at 10.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 265.4 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 89.5 66.2
TTM Earnings per share Rs 3.8 -3.1
Diluted earnings per share Rs 3.8 -3.1
Price to Cash Flow x 102.1 265.4
TTM P/E ratio x -482.5 -482.5
Price / Book Value ratio x 8.5 10.3
Market Cap Rs m 391,569 391,569
Dividends per share (Unadj.) Rs 1.0 0.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for TRENT

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.9x during FY21, from 3.5x 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 0.5x during FY21, from 1.7x 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 -4.7% during FY21, from 5.7% 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 5.5% during FY21, from 17.1% 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 2.7% during FY21, from 7.4% 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 3.5 1.9
Debtors’ Days Days 2 3
Interest coverage x 1.7 0.5
Debt to equity ratio x 0.1 0.0
Return on assets % 7.4 2.7
Return on equity % 5.7 -4.7
Return on capital employed % 17.1 5.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

TRENT Share Price Performance

Over the last one year, TRENT share price has moved up from Rs 641.3 to Rs 1,101.5, registering a gain of Rs 460.2 or around 71.8%.

Overall, the S&P BSE SENSEX is up 52.2% over the year.

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

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Related Views on News

TRENT 2019-20 Annual Report Analysis (Annual Result Update)

Dec 11, 2020 | Updated on Dec 11, 2020

Here's an analysis of the annual report of TRENT for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of TRENT. Also includes updates on the valuation of TRENT.

TRENT LTD Announces Quarterly Results (3QFY20); Net Profit Up 38.4% (Quarterly Result Update)

Feb 7, 2020 | Updated on Feb 7, 2020

For the quarter ended December 2019, TRENT LTD has posted a net profit of Rs 557 m (up 38.4% YoY). Sales on the other hand came in at Rs 9 bn (up 32.5% YoY). Read on for a complete analysis of TRENT LTD's quarterly results.

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