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TRENT 2018-19 Annual Report Analysis
Sun, 31 Mar

TRENT 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 Income Statement Analysis

  • Operating income during the year rose 21.5% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 12.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 10.1% in FY19 as against 10.9% in FY18.
  • Depreciation charges increased by 13.5% and finance costs increased by 15.7% YoY, respectively.
  • Other income declined by 7.7% YoY.
  • Net profit for the year declined by 2.9% YoY.
  • Net profit margins during the year declined from 5.6% in FY18 to 4.5% in FY19.

TRENT Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 19,683 23,910 21.5%
Other income Rs m 442 408 -7.7%
Total Revenues Rs m 20,125 24,318 20.8%
Gross profit Rs m 2,144 2,416 12.7%
Depreciation Rs m 455 517 13.5%
Interest Rs m 438 506 15.7%
Profit before tax Rs m 1,693 1,801 6.4%
Tax Rs m 596 736 23.5%
Profit after tax Rs m 1,097 1,065 -2.9%
Gross profit margin % 10.9 10.1
Effective tax rate % 35.2 40.9
Net profit margin % 5.6 4.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

TRENT 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 fell 1% and stood at Rs 17 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 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 17,050 16,804 -1.4
Total Assets Rs m 23,359 25,588 9.5
* 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 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 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: Accord Fintech, Equitymaster



Current Valuations for TRENT

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.2, an decline from the EPS of Rs 3.3 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 359.9, stands at 100.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 7.8 times, while the price to sales ratio stands at 5.0 times.
  • The company's price to cash flow (P/CF) ratio stood at 72.0 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 59.2 71.9
TTM Earnings per share Rs 3.3 3.2
Diluted earnings per share Rs 3.1 3.0
Price to Cash Flow x 79.3 72.0
TTM P/E ratio x 105.4 100.3
Price / Book Value ratio x 6.1 6.9
Market Cap Rs m 97,402 113,802
Dividends per share (Unadj.) Rs 1.2 1.3
* 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 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 4.6x during FY19, from 4.9x 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 declined and down at 6.5% during FY19, from 6.9% 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 declined and down at 11.9% during FY19, from 12.6% 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 declined and down at 6.1% during FY19, from 6.6% 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 0 0
Interest coverage x 4.9 4.6
Debt to equity ratio x 0.1 0.2
Return on assets % 6.6 6.1
Return on equity % 6.9 6.5
Return on capital employed % 12.6 11.9
* 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 346.2 to Rs 359.9, registering a gain of Rs 13.7 or around 4.0%.

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Annual Report FAQs

What is the current share price of TRENT?

TRENT currently trades at Rs 3,948.5 per share. You can check out the latest share price performance of TRENT here...

What was the revenue of TRENT in FY19? How does it compare to earlier years?

The revenues of TRENT stood at Rs 24,318 m in FY19, which was up 20.8% compared to Rs 20,125 m reported in FY18.

TRENT's revenue has fallen from Rs 24,801 m in FY15 to Rs 24,318 m in FY19.

Over the past 5 years, the revenue of TRENT has grown at a CAGR of -0.5%.

What was the net profit of TRENT in FY19? How does it compare to earlier years?

The net profit of TRENT stood at Rs 1,065 m in FY19, which was down -2.9% compared to Rs 1,097 m reported in FY18.

This compares to a net profit of Rs 939 m in FY17 and a net profit of Rs 471 m in FY16.

Over the past 5 years, TRENT net profit has grown at a CAGR of -4.8%.

What does the cash flow statement of TRENT reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of TRENT reveals:

  • Cash flow from operations decreased in FY19 and stood at Rs 210 m as compared to Rs 769 m in FY18.
  • Cash flow from investments decreased in FY19 and stood at Rs -370 m as compared to Rs -40 m in FY18.
  • Cash flow from financial activity increased in FY19 and stood at Rs 375 m as compared to Rs -743 m in FY18.

Here's the cash flow statement of TRENT for the past 5 years.

(Rs m)FY15FY16FY17FY18FY19
From Operations-1011,0941,024769210
From Investments-3,040-983-437-40-370
From Financial Activity3,099-133-514-743375
Net Cashflow-64-2374-15214

What does the Key Ratio analysis of TRENT reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of TRENT reveals:

  • Operating profit margins witnessed a fall and stood at 10.1% in FY19 as against 10.9% in FY18.
  • Net profit margins declined from 5.6% in FY18 to 4.5% in FY19.
  • Debt to Equity ratio for FY19 stood at 0.2 as compared to 0.1 in FY18.

Here's the ratio/financial analysis of TRENT for the past 5 years.

 FY15FY16FY17FY18FY19
Operating Profit Margin (%)8.36.86.810.910.1
Net Profit Margin (%)5.42.84.95.64.5
Debt to Equity Ratio (x)0.10.10.10.10.2

Read: Latest Annual Report Analysis of TRENT

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