TATA CONSUMER 2022-23 Annual Report Analysis

Tue, 16 May

TATA CONSUMER has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

TATA CONSUMER Income Statement Analysis

• Operating income during the year rose 10.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 21.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 14.6% in FY23 as against 13.4% in FY22.
• Depreciation charges increased by 9.4% and finance costs increased by 19.8% YoY, respectively.
• Other income grew by 20.6% YoY.
• Net profit for the year grew by 24.8% YoY.
• Net profit margins during the year grew from 8.7% in FY22 to 9.8% in FY23.

TATA CONSUMER Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	124,254	137,832	10.9%
Other income	Rs m	1,401	1,689	20.6%
Total Revenues	Rs m	125,654	139,520	11.0%
Gross profit	Rs m	16,667	20,159	21.0%
Depreciation	Rs m	2,780	3,041	9.4%
Interest	Rs m	728	872	19.8%
Profit before tax	Rs m	14,560	17,936	23.2%
Tax	Rs m	3,770	4,470	18.6%
Profit after tax	Rs m	10,790	13,465	24.8%
Gross profit margin	%	13.4	14.6
Effective tax rate	%	25.9	24.9
Net profit margin	%	8.7	9.8

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TATA CONSUMER Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 39 billion as compared to Rs 32 billion in FY22, thereby witnessing an increase of 23.7%.
• Long-term debt down at Rs 2 billion as compared to Rs 2 billion during FY22, a fall of 14.8%.
• Current assets rose 16% and stood at Rs 83 billion, while fixed assets rose 4% and stood at Rs 145 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 228 billion as against Rs 211 billion during FY22, thereby witnessing a growth of 8%.

TATA CONSUMER Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	151,415	162,722	7.5
Current Liabilities	Rs m	31,726	39,247	23.7
Long-term Debt	Rs m	2,419	2,061	-14.8
Total Liabilities	Rs m	210,749	227,625	8.0
Current assets	Rs m	71,357	83,086	16.4
Fixed Assets	Rs m	139,392	144,539	3.7
Total Assets	Rs m	210,749	227,625	8.0

TATA CONSUMER Cash Flow Statement Analysis

• TATA CONSUMER's cash flow from operating activities (CFO) during FY23 stood at Rs 15 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -8 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -7 billion, an improvement of 28% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -867 million from the Rs -8 billion net cash flows seen during FY22.

TATA CONSUMER Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	15,158	14,613	-3.6%
Cash Flow from Investing Activities	Rs m	-13,218	-8,278	-
Cash Flow from Financing Activities	Rs m	-9,948	-7,144	-
Net Cash Flow	Rs m	-7,961	-867	-

Current Valuations for TATA CONSUMER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 14.5, an improvement from the EPS of Rs 11.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 786.5, stands at 54.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.5 times, while the price to sales ratio stands at 5.3 times.
• The company's price to cash flow (P/CF) ratio stood at 43.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	134.8	148.4
TTM Earnings per share	Rs	11.7	14.5
Diluted earnings per share	Rs	11.6	14.5
Price to Cash Flow	x	53.2	43.5
TTM P/E ratio	x	66.9	54.3
Price / Book Value ratio	x	4.6	4.4
Market Cap	Rs m	692,661	718,289
Dividends per share (Unadj.)	Rs	6.1	8.5

Ratio Analysis for TATA CONSUMER

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.1x during FY23, from 2.2x during FY22. 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 21.6x during FY23, from 21.0x during FY22. 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 8.3% during FY23, from 7.1% during FY23. 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 11.4% during FY23, from 9.9% during FY22. 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 6.3% during FY23, from 5.5% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	2.2	2.1
Debtors’ Days	Days	2	2
Interest coverage	x	21.0	21.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	5.5	6.3
Return on equity	%	7.1	8.3
Return on capital employed	%	9.9	11.4

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 734.8 to Rs 786.5, registering a gain of Rs 51.8 or around 7.0%.

Meanwhile, the S&P BSE FMCG Index is trading at Rs 17,796.3 (up 0.1%). Over the last one year it has moved up from 13,449.2 to 17,796.3, a gain of 4,347 points (up 32.3%).

Overall, the S&P BSE SENSEX is up 17.7% over the year.

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