TVS MOTORS 2022-23 Annual Report Analysis

Wed, 28 Jun

TVS MOTORS 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.

TVS MOTORS Income Statement Analysis

• Operating income during the year rose 31.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 48.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 12.6% in FY23 as against 11.2% in FY22.
• Depreciation charges increased by 15.6% and finance costs increased by 45.5% YoY, respectively.
• Other income grew by 319.8% YoY.
• Net profit for the year grew by 79.2% YoY.
• Net profit margins during the year grew from 3.0% in FY22 to 4.1% in FY23.

TVS MOTORS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	243,553	319,740	31.3%
Other income	Rs m	329	1,380	319.8%
Total Revenues	Rs m	243,882	321,120	31.7%
Gross profit	Rs m	27,170	40,248	48.1%
Depreciation	Rs m	7,429	8,589	15.6%
Interest	Rs m	9,402	13,679	45.5%
Profit before tax	Rs m	10,668	19,360	81.5%
Tax	Rs m	3,359	6,266	86.5%
Profit after tax	Rs m	7,309	13,095	79.2%
Gross profit margin	%	11.2	12.6
Effective tax rate	%	31.5	32.4
Net profit margin	%	3.0	4.1

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TVS MOTORS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 192 billion as compared to Rs 139 billion in FY22, thereby witnessing an increase of 38.2%.
• Long-term debt stood at Rs 91 billion as compared to Rs 73 billion during FY22, a growth of 24.1%.
• Current assets rose 32% and stood at Rs 170 billion, while fixed assets rose 28% and stood at Rs 179 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 349 billion as against Rs 269 billion during FY22, thereby witnessing a growth of 30%.

TVS MOTORS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	43,995	55,050	25.1
Current Liabilities	Rs m	139,063	192,187	38.2
Long-term Debt	Rs m	73,058	90,641	24.1
Total Liabilities	Rs m	269,088	349,272	29.8
Current assets	Rs m	128,876	170,072	32.0
Fixed Assets	Rs m	140,212	179,200	27.8
Total Assets	Rs m	269,088	349,272	29.8

TVS MOTORS Cash Flow Statement Analysis

• TVS MOTORS's cash flow from operating activities (CFO) during FY23 stood at Rs -44 billion, an improvement of 179.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -13 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 61 billion, an improvement of 110% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 4 billion from the Rs -1 billion net cash flows seen during FY22.

TVS MOTORS 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	-15,752	-44,048	-
Cash Flow from Investing Activities	Rs m	-14,709	-13,077	-
Cash Flow from Financing Activities	Rs m	29,180	61,181	109.7%
Net Cash Flow	Rs m	-1,281	4,055	-

Current Valuations for TVS MOTORS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 27.6, an improvement from the EPS of Rs 15.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,305.3, stands at 45.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 11.3 times, while the price to sales ratio stands at 1.9 times.
• The company's price to cash flow (P/CF) ratio stood at 19.3 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	512.6	673.0
TTM Earnings per share	Rs	15.4	27.6
Diluted earnings per share	Rs	15.4	27.6
Price to Cash Flow	x	20.2	19.3
TTM P/E ratio	x	40.8	45.9
Price / Book Value ratio	x	7.0	7.6
Market Cap	Rs m	306,063	419,526
Dividends per share (Unadj.)	Rs	3.8	5.0

Ratio Analysis for TVS MOTORS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.9x during FY23, from 0.9x 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 2.4x during FY23, from 2.1x 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 23.8% during FY23, from 16.6% 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 22.7% during FY23, from 17.1% 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 7.7% during FY23, from 6.2% 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	0.9	0.9
Debtors’ Days	Days	2	1
Interest coverage	x	2.1	2.4
Debt to equity ratio	x	1.7	1.6
Return on assets	%	6.2	7.7
Return on equity	%	16.6	23.8
Return on capital employed	%	17.1	22.7

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 820.3 to Rs 1,305.3, registering a gain of Rs 485.0 or around 59.1%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 33,996.2 (up 0.0%). Over the last one year it has moved up from 27,016.2 to 33,996.2, a gain of 6,980 points (up 25.8%).

Overall, the S&P BSE SENSEX is up 19.3% over the year.

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