TATA POWER 2022-23 Annual Report Analysis

Tue, 30 May

TATA POWER 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 POWER Income Statement Analysis

• Operating income during the year fell 58.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 62.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 19.2% in FY23 as against 21.1% in FY22.
• Depreciation charges decreased by 62.6% and finance costs decreased by 42.4% YoY, respectively.
• Other income grew by 323.7% YoY.
• Net profit for the year grew by 24.6% YoY.
• Net profit margins during the year grew from 6.1% in FY22 to 18.4% in FY23.

TATA POWER Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	428,157	177,278	-58.6%
Other income	Rs m	9,663	40,938	323.7%
Total Revenues	Rs m	437,819	218,216	-50.2%
Gross profit	Rs m	90,232	34,113	-62.2%
Depreciation	Rs m	31,222	11,675	-62.6%
Interest	Rs m	38,642	22,266	-42.4%
Profit before tax	Rs m	30,030	41,110	36.9%
Tax	Rs m	3,796	8,431	122.1%
Profit after tax	Rs m	26,234	32,679	24.6%
Gross profit margin	%	21.1	19.2
Effective tax rate	%	12.6	20.5
Net profit margin	%	6.1	18.4

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TATA POWER Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 185 billion as compared to Rs 393 billion in FY22, thereby witnessing an decrease of -53.0%.
• Long-term debt down at Rs 113 billion as compared to Rs 327 billion during FY22, a fall of 65.6%.
• Current assets fell 74% and stood at Rs 75 billion, while fixed assets fell 51% and stood at Rs 401 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 482 billion as against Rs 1,126 billion during FY22, thereby witnessing a fall of 57%.

TATA POWER Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	224,416	136,996	-39.0
Current Liabilities	Rs m	392,547	184,552	-53.0
Long-term Debt	Rs m	327,297	112,723	-65.6
Total Liabilities	Rs m	1,125,500	481,727	-57.2
Current assets	Rs m	283,960	75,031	-73.6
Fixed Assets	Rs m	811,072	400,733	-50.6
Total Assets	Rs m	1,125,500	481,727	-57.2

TATA POWER Cash Flow Statement Analysis

• TATA POWER's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 51 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -53 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 3 billion from the Rs -7 billion net cash flows seen during FY22.

TATA POWER 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	66,927	5,001	-92.5%
Cash Flow from Investing Activities	Rs m	-62,766	51,241	-
Cash Flow from Financing Activities	Rs m	-11,832	-53,496	-
Net Cash Flow	Rs m	-7,409	2,745	-

Current Valuations for TATA POWER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.2, an improvement from the EPS of Rs 8.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 216.4, stands at 113.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.0 times, while the price to sales ratio stands at 3.9 times.
• The company's price to cash flow (P/CF) ratio stood at 17.3 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	134.0	55.5
TTM Earnings per share	Rs	8.2	10.2
Diluted earnings per share	Rs	8.2	10.2
Price to Cash Flow	x	13.3	17.3
TTM P/E ratio	x	112.1	113.3
Price / Book Value ratio	x	2.6	5.6
Market Cap	Rs m	574,602	767,600
Dividends per share (Unadj.)	Rs	1.8	2.0

Ratio Analysis for TATA POWER

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.4x during FY23, from 0.7x 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 2.8x during FY23, from 1.8x 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 23.9% during FY23, from 11.7% 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 25.4% during FY23, from 12.4% 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 11.4% during FY23, from 5.8% 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	0.7	0.4
Debtors’ Days	Days	5	4
Interest coverage	x	1.8	2.8
Debt to equity ratio	x	1.5	0.8
Return on assets	%	5.8	11.4
Return on equity	%	11.7	23.9
Return on capital employed	%	12.4	25.4

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

TATA POWER Share Price Performance

Over the last one year, TATA POWER share price has moved down from Rs 233.3 to Rs 216.4, registering a loss of Rs 16.9 or around 7.2%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 3,851.0 (up 0.2%). Over the last one year it has moved down from 4,320.2 to 3,851.0, a loss of 469 points (down 10.9%).

Overall, the S&P BSE SENSEX is up 16.0% over the year.

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