TVS MOTORS 2018-19 Annual Report Analysis

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TVS MOTORS 2018-19 Annual Report Analysis
Thu, 27 Jun

TVS MOTORS has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

TVS MOTORS Income Statement Analysis

  • Operating income during the year rose 23.4% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 40.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 10.7% in FY19 as against 9.4% in FY18.
  • Depreciation charges increased by 18.2% and finance costs increased by 96.1% YoY, respectively.
  • Other income declined by 74.5% YoY.
  • Net profit for the year grew by 9.1% YoY.
  • Net profit margins during the year declined from 4.0% in FY18 to 3.6% in FY19.

TVS MOTORS Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 163,403 201,600 23.4%
Other income Rs m 996 254 -74.5%
Total Revenues Rs m 164,399 201,854 22.8%
Gross profit Rs m 15,425 21,608 40.1%
Depreciation Rs m 3,736 4,417 18.2%
Interest Rs m 3,382 6,634 96.1%
Profit before tax Rs m 9,302 10,812 16.2%
Tax Rs m 2,660 3,575 34.4%
Profit after tax Rs m 6,648 7,254 9.1%
Gross profit margin % 9.4 10.7
Effective tax rate % 28.6 33.1
Net profit margin % 4.0 3.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TVS MOTORS Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 82 billion as compared to Rs 78 billion in FY18, thereby witnessing an increase of 4.5%.
  • Long-term debt stood at Rs 49 billion as compared to Rs 24 billion during FY18, a growth of 107.9%.
  • Current assets rose 32% and stood at Rs 83 billion, while fixed assets rose 19% and stood at Rs 37 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 167 billion as against Rs 132 billion during FY18, thereby witnessing a growth of 27%.

TVS MOTORS Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 26,772 31,702 18.4
 
Current Liabilities Rs m 78,299 81,848 4.5
Long-term Debt Rs m 23,609 49,092 107.9
Total Liabilities Rs m 131,903 166,965 26.6
 
Current assets Rs m 63,247 83,317 31.7
Fixed Assets Rs m 31,209 37,204 19.2
Total Assets Rs m 131,903 166,965 26.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



TVS MOTORS Cash Flow Statement Analysis

  • TVS MOTORS's cash flow from operating activities (CFO) during FY19 stood at Rs -9 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -11 billion, an improvement of 0.8% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 22 billion, an improvement of 146% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 2 billion from the Rs 2 billion net cash flows seen during FY18.

TVS MOTORS Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 3,544 -9,179 -
Cash Flow from Investing Activities Rs m -10,952 -11,036 -
Cash Flow from Financing Activities Rs m 8,965 22,098 146.5%
Net Cash Flow Rs m 1,558 1,882 20.8%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for TVS MOTORS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.3, an improvement from the EPS of Rs 14.0 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 434.5, stands at 30.8 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 8.6 times, while the price to sales ratio stands at 1.3 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 343.9 424.3
TTM Earnings per share Rs 14.0 15.3
Diluted earnings per share Rs 14.0 15.3
Price to Cash Flow x 19.9 17.7
TTM P/E ratio x 30.8 30.8
Price / Book Value ratio x 10.9 8.6
Market Cap Rs m 206,403 206,403
Dividends per share (Unadj.) Rs 3.3 3.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for TVS MOTORS

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.0x during FY19, from 0.8x during FY18. 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 2.6x during FY19, from 3.8x during FY18. 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 declined and down at 22.9% during FY19, from 24.8% during FY19. 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 21.6% during FY19, from 25.2% during FY18. 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 8.3% during FY19, from 7.6% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 0.8 1.0
Debtors’ Days Days 24 28
Interest coverage x 3.8 2.6
Debt to equity ratio x 0.9 1.5
Return on assets % 7.6 8.3
Return on equity % 24.8 22.9
Return on capital employed % 25.2 21.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how TVS MOTORS has performed over the last 5 years, please visit here.

TVS MOTORS Share Price Performance

Over the last one year, TVS MOTORS share price has moved up from Rs 568.6 to Rs 434.5, registering a loss of Rs 134.2 or around 23.6%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 17,969.9 (up 0.9%). Over the last one year it has moved down from 23,861.6 to 17,969.9, a loss of 5,892 points (down 24.7%).

Overall, the S&P BSE SENSEX is up 11.9% over the year.

(To know more, check out historical annual results for TVS MOTORS and quarterly results for TVS MOTORS)

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