UPL 2018-19 Annual Report Analysis

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UPL 2018-19 Annual Report Analysis
Wed, 9 Oct

UPL 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.

UPL Income Statement Analysis

  • Operating income during the year rose 25.7% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 8.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.5% in FY19 as against 20.2% in FY18.
  • Depreciation charges increased by 43.6% and finance costs increased by 23.0% YoY, respectively.
  • Other income declined by 42.0% YoY.
  • Net profit for the year declined by 25.2% YoY.
  • Net profit margins during the year declined from 11.4% in FY18 to 6.9% in FY19.

UPL Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 173,780 218,370 25.7%
Other income Rs m 4,140 2,400 -42.0%
Total Revenues Rs m 177,920 220,770 24.1%
Gross profit Rs m 35,050 38,130 8.8%
Depreciation Rs m 6,750 9,690 43.6%
Interest Rs m 7,830 9,630 23.0%
Profit before tax Rs m 24,610 21,210 -13.8%
Tax Rs m 2,750 1,650 -40.0%
Profit after tax Rs m 20,300 15,190 -25.2%
Gross profit margin % 20.2 17.5
Effective tax rate % 11.2 7.8
Net profit margin % 11.4 6.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Know More: Which way are the markets & the mutual fund industry headed?

UPL Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 156 billion as compared to Rs 76 billion in FY18, thereby witnessing an increase of 103.7%.
  • Long-term debt stood at Rs 264 billion as compared to Rs 59 billion during FY18, a growth of 349.2%.
  • Current assets rose 80% and stood at Rs 270 billion, while fixed assets rose 455% and stood at Rs 341 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 630 billion as against Rs 230 billion during FY18, thereby witnessing a growth of 174%.

UPL Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 91,690 146,450 59.7
 
Current Liabilities Rs m 76,420 155,640 103.7
Long-term Debt Rs m 58,730 263,830 349.2
Total Liabilities Rs m 230,430 630,480 173.6
 
Current assets Rs m 150,040 269,660 79.7
Fixed Assets Rs m 61,420 340,920 455.1
Total Assets Rs m 230,430 630,480 173.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



UPL Cash Flow Statement Analysis

  • UPL 's cash flow from operating activities (CFO) during FY19 stood at Rs 24 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -320 billion, an improvement of 1,427.4% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 289 billion, an improvement of 3,707% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -320 million from the Rs -180 million net cash flows seen during FY18.

UPL 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 28,390 23,560 -17.0%
Cash Flow from Investing Activities Rs m -20,930 -319,680 -
Cash Flow from Financing Activities Rs m -8,010 288,940 -
Net Cash Flow Rs m -180 -320 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for UPL

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 29.8, an decline from the EPS of Rs 39.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 578.1, stands at 36.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.6 times, while the price to sales ratio stands at 1.7 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.9 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 341.2 428.7
TTM Earnings per share Rs 39.9 29.8
Diluted earnings per share Rs 26.6 19.9
Price to Cash Flow x 10.5 17.9
TTM P/E ratio x 24.3 36.5
Price / Book Value ratio x 4.4 2.6
Market Cap Rs m 294,444 441,676
Dividends per share (Unadj.) Rs 8.0 8.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for UPL

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY19, from 2.0x 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 3.2x during FY19, from 4.1x 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 10.4% during FY19, from 22.1% 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 6.5% during FY19, from 20.5% 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 declined and down at 3.9% during FY19, from 12.2% 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 2.0 1.7
Debtors’ Days Days 127 197
Interest coverage x 4.1 3.2
Debt to equity ratio x 0.6 1.8
Return on assets % 12.2 3.9
Return on equity % 22.1 10.4
Return on capital employed % 20.5 6.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

UPL Share Price Performance

Over the last one year, UPL share price has moved up from Rs 403.5 to Rs 578.1, registering a gain of Rs 174.6 or around 43.3%.

Overall, the S&P BSE SENSEX is up 8.9% over the year.

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

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