TATA CONSUMER 2020-21 Annual Report Analysis

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TATA CONSUMER 2020-21 Annual Report Analysis
Thu, 8 Jul

TATA CONSUMER 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.

TATA CONSUMER Income Statement Analysis

  • Operating income during the year rose 20.4% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 48.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.0% in FY21 as against 10.6% in FY20.
  • Depreciation charges increased by 5.4% and finance costs decreased by 11.8% YoY, respectively.
  • Other income grew by 8.8% YoY.
  • Net profit for the year grew by 85.7% YoY.
  • Net profit margins during the year grew from 5.5% in FY20 to 8.5% in FY21.

TATA CONSUMER Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 96,374 116,020 20.4%
Other income Rs m 1,116 1,214 8.8%
Total Revenues Rs m 97,490 117,234 20.3%
Gross profit Rs m 10,174 15,131 48.7%
Depreciation Rs m 2,417 2,547 5.4%
Interest Rs m 779 687 -11.8%
Profit before tax Rs m 8,094 13,111 62.0%
Tax Rs m 2,742 3,173 15.7%
Profit after tax Rs m 5,352 9,938 85.7%
Gross profit margin % 10.6 13.0
Effective tax rate % 33.9 24.2
Net profit margin % 5.5 8.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Find Out: How to Create Massive Gains from Govt's Mega 2023 Plan?

TATA CONSUMER Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 31 billion as compared to Rs 20 billion in FY20, thereby witnessing an increase of 56.4%.
  • Long-term debt down at Rs 3 billion as compared to Rs 8 billion during FY20, a fall of 63.8%.
  • Current assets rose 24% and stood at Rs 70 billion, while fixed assets rose 3% and stood at Rs 132 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 202 billion as against Rs 185 billion during FY20, thereby witnessing a growth of 9%.

TATA CONSUMER Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 138,149 145,345 5.2
 
Current Liabilities Rs m 19,786 30,945 56.4
Long-term Debt Rs m 7,947 2,875 -63.8
Total Liabilities Rs m 184,730 202,178 9.4
 
Current assets Rs m 56,821 70,486 24.1
Fixed Assets Rs m 127,910 131,692 3.0
Total Assets Rs m 184,730 202,178 9.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



TATA CONSUMER Cash Flow Statement Analysis

  • TATA CONSUMER's cash flow from operating activities (CFO) during FY21 stood at Rs 17 billion, an improvement of 53.1% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -4 billion 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 9 billion from the Rs 2 billion net cash flows seen during FY20.

TATA CONSUMER 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 10,822 16,564 53.1%
Cash Flow from Investing Activities Rs m -6,728 -4,084 -
Cash Flow from Financing Activities Rs m -3,083 -4,260 -
Net Cash Flow Rs m 1,519 8,838 482.0%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for TATA CONSUMER

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.8, an improvement from the EPS of Rs 5.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 761.4, stands at 70.6 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.9 times, while the price to sales ratio stands at 3.6 times.
  • The company's price to cash flow (P/CF) ratio stood at 56.2 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 104.6 125.9
TTM Earnings per share Rs 5.8 10.8
Diluted earnings per share Rs 5.8 10.8
Price to Cash Flow x 90.3 56.2
TTM P/E ratio x 70.6 70.6
Price / Book Value ratio x 2.0 2.9
Market Cap Rs m 701,623 701,623
Dividends per share (Unadj.) Rs 2.7 4.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for TATA CONSUMER

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 2.3x during FY21, from 2.9x 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 improved and stood at 20.1x during FY21, from 11.4x 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 improved and stood at 6.8% during FY21, from 3.9% 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 improved and stood at 9.3% during FY21, from 6.1% 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 improved and stood at 5.3% during FY21, from 3.3% 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 2.9 2.3
Debtors’ Days Days 35 24
Interest coverage x 11.4 20.1
Debt to equity ratio x 0.1 0.0
Return on assets % 3.3 5.3
Return on equity % 3.9 6.8
Return on capital employed % 6.1 9.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

TATA CONSUMER Share Price Performance

Over the last one year, TATA CONSUMER share price has moved up from Rs 432.3 to Rs 761.4, registering a gain of Rs 329.1 or around 76.1%.

Meanwhile, the S&P BSE FMCG Index is trading at Rs 13,585.3 (down 0.6%). Over the last one year it has moved up from 11,357.8 to 13,585.3, a gain of 2,228 points (up 19.6%).

Overall, the S&P BSE SENSEX is up 44.5% over the year.

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

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