TATA SPONGE 2017-18 Annual Report Analysis

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TATA SPONGE 2017-18 Annual Report Analysis
Fri, 21 Dec

TATA SPONGE has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

TATA SPONGE Income Statement Analysis

  • Operating income during the year rose 43.6% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 196.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 22.8% in FY18 as against 11.1% in FY17.
  • Depreciation charges decreased by 3.6% and finance costs increased by 33.2% YoY, respectively.
  • Other income grew by 16.2% YoY.
  • Net profit for the year grew by 139.7% YoY.
  • Net profit margins during the year grew from 9.9% in FY17 to 16.7% in FY18.

TATA SPONGE Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 5,573 8,002 43.6%
Other income Rs m 371 431 16.2%
Total Revenues Rs m 5,944 8,432 41.9%
Gross profit Rs m 616 1,827 196.4%
Depreciation Rs m 128 123 -3.6%
Interest Rs m 24 33 33.2%
Profit before tax Rs m 835 2,102 151.7%
Tax Rs m 247 693 180.3%
Profit after tax Rs m 588 1,409 139.7%
Gross profit margin % 11.1 22.8
Effective tax rate % 29.6 33.0
Net profit margin % 9.9 16.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TATA SPONGE Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 2 billion as compared to Rs 1 billion in FY17, thereby witnessing an increase of 32.9%.
  • Current assets rose 7% and stood at Rs 7 billion, while fixed assets fell 3% and stood at Rs 2 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 12 billion as against Rs 10 billion during FY17, thereby witnessing a growth of 16%.

TATA SPONGE Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 8,649 9,866 14.1
 
Current Liabilities Rs m 1,491 1,982 32.9
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 10,458 12,144 16.1
 
Current assets Rs m 6,715 7,206 7.3
Fixed Assets Rs m 1,603 1,548 -3.4
Total Assets Rs m 10,458 12,144 16.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TATA SPONGE Cash Flow Statement Analysis

  • TATA SPONGE's cash flow from operating activities (CFO) during FY18 stood at Rs 411 million, an improvement of 89.7% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -2 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -202 million on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs -2 billion from the Rs 546 million net cash flows seen during FY17.

TATA SPONGE Cash Flow Statement 2017-18

Particulars No. of months 12 12 % Change
Year Ending Mar-17 Mar-18
Cash Flow from Operating Activities Rs m 217 411 89.7%
Cash Flow from Investing Activities Rs m 514 -2,131 -
Cash Flow from Financing Activities Rs m -185 -202 -
Net Cash Flow Rs m 546 -1,922 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for TATA SPONGE

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 91.5, an improvement from the EPS of Rs 38.2 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 807.6, stands at 8.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.5 times, while the price to sales ratio stands at 1.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 8.1 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Sales per share (Unadj.) Rs 361.9 519.6
TTM Earnings per share Rs 38.2 91.5
Diluted earnings per share Rs 38.2 91.5
Price to Cash Flow x 17.4 8.1
TTM P/E ratio x 8.0 8.0
Price / Book Value ratio x 1.1 1.5
Market Cap Rs m 12,436 12,436
Dividends per share (Unadj.) Rs 11.0 20.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for TATA SPONGE

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.6x during FY18, from 4.5x during FY17. 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 65.7x during FY18, from 35.2x during FY17. 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 14.3% during FY18, from 6.8% during FY18. 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 21.6% during FY18, from 9.9% during FY17. 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 11.9% during FY18, from 5.9% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-17* 12 Mar-18*
Current ratio x 4.5 3.6
Debtors’ Days Days 23 27
Interest coverage x 35.2 65.7
Debt to equity ratio x 0.0 0.0
Return on assets % 5.9 11.9
Return on equity % 6.8 14.3
Return on capital employed % 9.9 21.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

TATA SPONGE Share Price Performance

Over the last one year, TATA SPONGE share price has moved up from Rs 938.9 to Rs 807.6, registering a loss of Rs 131.4 or around 14.0%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 12,002.8 (up 0.9%). Over the last one year it has moved down from 14,536.6 to 12,002.8, a loss of 2,534 points (down 17.4%).

Overall, the S&P BSE SENSEX is up 7.8% over the year.

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

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TATA SPONGE Announces Quarterly Results (1QFY20); Net Profit Down 288.8% (Quarterly Result Update)

Jul 31, 2019 | Updated on Jul 31, 2019

For the quarter ended June 2019, TATA SPONGE has posted a net profit of Rs 860 m (down 288.8% YoY). Sales on the other hand came in at Rs 7 bn (up 170.0% YoY). Read on for a complete analysis of TATA SPONGE's quarterly results.

TATA SPONGE 2018-19 Annual Report Analysis (Annual Result Update)

Jun 27, 2019 | Updated on Jun 27, 2019

Here's an analysis of the annual report of TATA SPONGE for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of TATA SPONGE. Also includes updates on the valuation of TATA SPONGE.

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For the quarter ended March 2019, TATA SPONGE has posted a net profit of Rs 244 m (down 47.8% YoY). Sales on the other hand came in at Rs 3 bn (up 4.3% YoY). Read on for a complete analysis of TATA SPONGE's quarterly results.

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