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TRENT LTD 2018-19 Annual Report Analysis

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TRENT LTD 2018-19 Annual Report Analysis
Thu, 4 Jul

TRENT LTD has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

TRENT LTD Income Statement Analysis

  • Operating income during the year rose 21.9% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 13.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 8.7% in FY19 as against 9.3% in FY18.
  • Depreciation charges increased by 13.5% and finance costs increased by 20.3% YoY, respectively.
  • Other income declined by 7.7% YoY.
  • Net profit for the year grew by 9.0% YoY.
  • Net profit margins during the year declined from 4.0% in FY18 to 3.6% in FY19.

TRENT LTD Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 21,575 26,302 21.9%
Other income Rs m 442 408 -7.7%
Total Revenues Rs m 22,017 26,711 21.3%
Gross profit Rs m 2,012 2,277 13.2%
Depreciation Rs m 455 517 13.5%
Interest Rs m 306 368 20.3%
Profit before tax Rs m 1,693 1,801 6.4%
Tax Rs m 596 736 23.5%
Profit after tax Rs m 870 948 9.0%
Gross profit margin % 9.3 8.7
Effective tax rate % 35.2 40.9
Net profit margin % 4.0 3.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TRENT LTD Balance Sheet Analysis

  • The company's current liabilities during FY19 down at Rs 6 billion as compared to Rs 6 billion in FY18, thereby witnessing an decrease of -5.3%.
  • Long-term debt stood at Rs 3 billion as compared to Rs 999 million during FY18, a growth of 199.9%.
  • Current assets rose 39% and stood at Rs 9 billion, while fixed assets rose 20% and stood at Rs 7 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 26 billion as against Rs 23 billion during FY18, thereby witnessing a growth of 10%.

TRENT LTD Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 15,954 16,465 3.2
 
Current Liabilities Rs m 6,065 5,740 -5.3
Long-term Debt Rs m 999 2,996 199.9
Total Liabilities Rs m 23,359 25,588 9.5
 
Current assets Rs m 6,308 8,783 39.2
Fixed Assets Rs m 6,221 7,494 20.5
Total Assets Rs m 23,359 25,588 9.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TRENT LTD Cash Flow Statement Analysis

  • TRENT LTD's cash flow from operating activities (CFO) during FY19 stood at Rs 210 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -370 million, an improvement of 819.1% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 375 million, an improvement of 150% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 214 million from the Rs -15 million net cash flows seen during FY18.

TRENT LTD Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 769 210 -72.7%
Cash Flow from Investing Activities Rs m -40 -370 -
Cash Flow from Financing Activities Rs m -743 375 -
Net Cash Flow Rs m -15 214 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for TRENT LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 28.5, an improvement from the EPS of Rs 26.2 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 451.1, stands at 117.6 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 0.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 94.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 649.3 791.5
TTM Earnings per share Rs 26.2 28.5
Diluted earnings per share Rs 2.6 2.9
Price to Cash Flow x 9.7 94.8
TTM P/E ratio x 11.8 117.6
Price / Book Value ratio x 0.6 0.7
Market Cap Rs m 14,988 149,884
Dividends per share (Unadj.) Rs 1.2 1.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for TRENT LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.5x during FY19, from 1.0x during FY18. 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 5.9x during FY19, from 6.5x during FY18. 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 5.8% during FY19, from 5.5% during FY19. 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 10.5% during FY19, from 10.5% during FY18. 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 5.1% during FY19, from 5.0% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.0 1.5
Debtors’ Days Days 3 2
Interest coverage x 6.5 5.9
Debt to equity ratio x 0.1 0.2
Return on assets % 5.0 5.1
Return on equity % 5.5 5.8
Return on capital employed % 10.5 10.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

TRENT LTD Share Price Performance

Over the last one year, TRENT LTD share price has moved up from Rs 313.3 to Rs 451.1, registering a gain of Rs 137.8 or around 44.0%.

Overall, the S&P BSE SENSEX is up 12.9% over the year.

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

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