TATA ELXSI 2022-23 Annual Report Analysis

Thu, 8 Jun

TATA ELXSI 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 ELXSI Income Statement Analysis

• Operating income during the year rose 27.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 25.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 30.5% in FY23 as against 31.0% in FY22.
• Depreciation charges increased by 47.1% and finance costs increased by 65.1% YoY, respectively.
• Other income grew by 70.7% YoY.
• Net profit for the year grew by 37.4% YoY.
• Net profit margins during the year grew from 22.2% in FY22 to 24.0% in FY23.

TATA ELXSI Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	24,708	31,447	27.3%
Other income	Rs m	446	761	70.7%
Total Revenues	Rs m	25,154	32,208	28.0%
Gross profit	Rs m	7,667	9,601	25.2%
Depreciation	Rs m	553	814	47.1%
Interest	Rs m	105	173	65.1%
Profit before tax	Rs m	7,455	9,375	25.8%
Tax	Rs m	1,958	1,823	-6.9%
Profit after tax	Rs m	5,497	7,552	37.4%
Gross profit margin	%	31.0	30.5
Effective tax rate	%	26.3	19.4
Net profit margin	%	22.2	24.0

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TATA ELXSI Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 5 billion as compared to Rs 4 billion in FY22, thereby witnessing an increase of 16.7%.
• Current assets rose 36% and stood at Rs 23 billion, while fixed assets fell 6% and stood at Rs 4 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 28 billion as against Rs 22 billion during FY22, thereby witnessing a growth of 27%.

TATA ELXSI Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	16,009	20,858	30.3
Current Liabilities	Rs m	4,102	4,786	16.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	21,602	27,506	27.3
Current assets	Rs m	16,957	23,135	36.4
Fixed Assets	Rs m	4,645	4,371	-5.9
Total Assets	Rs m	21,602	27,506	27.3

TATA ELXSI Cash Flow Statement Analysis

• TATA ELXSI's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion, an improvement of 0.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 billion, an improvement of 86.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -3 billion, an improvement of 7% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -172 million from the Rs 507 million net cash flows seen during FY22.

TATA ELXSI 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	4,830	4,869	0.8%
Cash Flow from Investing Activities	Rs m	-1,083	-2,019	-
Cash Flow from Financing Activities	Rs m	-3,261	-3,031	-
Net Cash Flow	Rs m	507	-172	-

Current Valuations for TATA ELXSI

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 121.3, an improvement from the EPS of Rs 88.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 7,865.0, stands at 64.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 23.5 times, while the price to sales ratio stands at 15.6 times.
• The company's price to cash flow (P/CF) ratio stood at 61.3 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	396.7	504.9
TTM Earnings per share	Rs	88.3	121.3
Diluted earnings per share	Rs	88.3	121.3
Price to Cash Flow	x	91.0	61.3
TTM P/E ratio	x	100.2	64.9
Price / Book Value ratio	x	23.6	24.6
Market Cap	Rs m	377,395	512,799
Dividends per share (Unadj.)	Rs	42.5	60.6

Ratio Analysis for TATA ELXSI

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 4.8x during FY23, from 4.1x 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 deteriorated and stood at 55.2x during FY23, from 72.2x 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 36.2% during FY23, from 34.3% 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 declined and down at 45.8% during FY23, from 47.2% 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 28.1% during FY23, from 25.9% 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	4.1	4.8
Debtors’ Days	Days	994	1,133
Interest coverage	x	72.2	55.2
Debt to equity ratio	x	0.0	0.0
Return on assets	%	25.9	28.1
Return on equity	%	34.3	36.2
Return on capital employed	%	47.2	45.8

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

TATA ELXSI Share Price Performance

Over the last one year, TATA ELXSI share price has moved down from Rs 8,605.0 to Rs 7,865.0, registering a loss of Rs 740.0 or around 8.6%.

Meanwhile, the S&P BSE IT Index is trading at Rs 29,025.5 (down 0.3%). Over the last one year it has moved down from 29,948.8 to 29,025.5, a loss of 923 points (down 3.1%).

Overall, the S&P BSE SENSEX is up 13.7% over the year.

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