TVS MOTORS 2020-21 Annual Report Analysis

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TVS MOTORS 2020-21 Annual Report Analysis
Mon, 6 Sep

TVS MOTORS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

TVS MOTORS Income Statement Analysis

  • Operating income during the year rose 3.0% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 0.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 11.5% in FY21 as against 11.8% in FY20.
  • Depreciation charges increased by 1.6% and finance costs increased by 3.2% YoY, respectively.
  • Other income declined by 8.9% YoY.
  • Net profit for the year declined by 6.1% YoY.
  • Net profit margins during the year declined from 3.5% in FY20 to 3.2% in FY21.

TVS MOTORS Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 188,493 194,208 3.0%
Other income Rs m 518 472 -8.9%
Total Revenues Rs m 189,011 194,680 3.0%
Gross profit Rs m 22,327 22,285 -0.2%
Depreciation Rs m 5,560 5,648 1.6%
Interest Rs m 8,545 8,815 3.2%
Profit before tax Rs m 8,740 8,294 -5.1%
Tax Rs m 2,186 2,141 -2.1%
Profit after tax Rs m 6,554 6,153 -6.1%
Gross profit margin % 11.8 11.5
Effective tax rate % 25.0 25.8
Net profit margin % 3.5 3.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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TVS MOTORS Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 109 billion as compared to Rs 100 billion in FY20, thereby witnessing an increase of 8.8%.
  • Long-term debt stood at Rs 63 billion as compared to Rs 52 billion during FY20, a growth of 20.3%.
  • Current assets rose 8% and stood at Rs 105 billion, while fixed assets rose 19% and stood at Rs 113 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 219 billion as against Rs 193 billion during FY20, thereby witnessing a growth of 13%.

TVS MOTORS Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 32,821 38,266 16.6
 
Current Liabilities Rs m 100,252 109,087 8.8
Long-term Debt Rs m 52,212 62,803 20.3
Total Liabilities Rs m 192,722 218,651 13.5
 
Current assets Rs m 97,390 105,368 8.2
Fixed Assets Rs m 95,332 113,282 18.8
Total Assets Rs m 192,722 218,651 13.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



TVS MOTORS Cash Flow Statement Analysis

  • TVS MOTORS's cash flow from operating activities (CFO) during FY21 stood at Rs 12 billion, an improvement of 208.3% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -9 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs 3 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs 5 billion from the Rs 9 billion net cash flows seen during FY20.

TVS MOTORS Cash Flow Statement 2020-21

Particulars No. of months 12 12 % Change
Year Ending Mar-20 Mar-21
Cash Flow from Operating Activities Rs m 3,734 11,513 208.3%
Cash Flow from Investing Activities Rs m -10,902 -8,824 -
Cash Flow from Financing Activities Rs m 16,192 2,527 -84.4%
Net Cash Flow Rs m 9,025 5,216 -42.2%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for TVS MOTORS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.0, an decline from the EPS of Rs 13.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 547.0, stands at 33.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 5.6 times, while the price to sales ratio stands at 1.1 times.
  • The company's price to cash flow (P/CF) ratio stood at 22.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Sales per share (Unadj.) Rs 396.8 408.8
TTM Earnings per share Rs 13.8 13.0
Diluted earnings per share Rs 13.8 13.0
Price to Cash Flow x 21.5 22.0
TTM P/E ratio x 33.3 33.3
Price / Book Value ratio x 5.9 5.6
Market Cap Rs m 259,873 259,873
Dividends per share (Unadj.) Rs 3.5 3.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for TVS MOTORS

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.0x during FY21, from 1.0x during FY20. 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 1.9x during FY21, from 2.0x during FY20. 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 16.1% during FY21, from 20.0% during FY21. 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 16.9% during FY21, from 20.3% during FY20. 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 declined and down at 6.8% during FY21, from 7.8% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-20* 12 Mar-21*
Current ratio x 1.0 1.0
Debtors’ Days Days 3 2
Interest coverage x 2.0 1.9
Debt to equity ratio x 1.6 1.6
Return on assets % 7.8 6.8
Return on equity % 20.0 16.1
Return on capital employed % 20.3 16.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, 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 433.6 to Rs 547.0, registering a gain of Rs 113.5 or around 26.2%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 22,796.8 (up 0.5%). Over the last one year it has moved up from 18,050.7 to 22,796.8, a gain of 4,746 points (up 26.3%).

Overall, the S&P BSE SENSEX is up 49.2% over the year.

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

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For the quarter ended September 2021, TVS MOTORS has posted a net profit of Rs 2 bn (up 26.4% YoY). Sales on the other hand came in at Rs 65 bn (up 23.4% YoY). Read on for a complete analysis of TVS MOTORS's quarterly results.

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