VAKRANGEE 2017-18 Annual Report Analysis

Sat, 31 Mar

VAKRANGEE 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.

VAKRANGEE Income Statement Analysis

• Operating income during the year rose 62.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 5.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 15.2% in FY18 as against 23.4% in FY17.
• Depreciation charges decreased by 94.3% and finance costs decreased by 79.4% YoY, respectively.
• Other income grew by 283.4% YoY.
• Net profit for the year grew by 28.2% YoY.
• Net profit margins during the year declined from 13.3% in FY17 to 10.5% in FY18.

VAKRANGEE Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	40,005	65,020	62.5%
Other income	Rs m	134	512	283.4%
Total Revenues	Rs m	40,138	65,532	63.3%
Gross profit	Rs m	9,379	9,871	5.2%
Depreciation	Rs m	734	42	-94.3%
Interest	Rs m	501	103	-79.4%
Profit before tax	Rs m	8,278	10,239	23.7%
Tax	Rs m	2,970	3,434	15.6%
Profit after tax	Rs m	5,308	6,805	28.2%
Gross profit margin	%	23.4	15.2
Effective tax rate	%	35.9	33.5
Net profit margin	%	13.3	10.5

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VAKRANGEE Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 4 billion as compared to Rs 2 billion in FY17, thereby witnessing an increase of 86.1%.
• Current assets rose 28% and stood at Rs 28 billion, while fixed assets rose 259% and stood at Rs 1 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 30 billion as against Rs 23 billion during FY17, thereby witnessing a growth of 32%.

VAKRANGEE Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	20,468	24,980	22.0
Current Liabilities	Rs m	2,110	3,927	86.1
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	22,666	29,813	31.5
Current assets	Rs m	22,278	28,420	27.6
Fixed Assets	Rs m	388	1,393	259.1
Total Assets	Rs m	22,666	29,813	31.5

VAKRANGEE Cash Flow Statement Analysis

• VAKRANGEE's cash flow from operating activities (CFO) during FY18 stood at Rs 5 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -989 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -1 billion, an improvement of 4% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 3 billion from the Rs 6 billion net cash flows seen during FY17.

VAKRANGEE 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	6,687	5,299	-20.8%
Cash Flow from Investing Activities	Rs m	537	-989	-
Cash Flow from Financing Activities	Rs m	-1,419	-1,365	-
Net Cash Flow	Rs m	5,806	2,945	-49.3%

Current Valuations for VAKRANGEE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.4, an decline from the EPS of Rs 10.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 221.2, stands at 34.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.4 times, while the price to sales ratio stands at 3.6 times.
• The company's price to cash flow (P/CF) ratio stood at 71.4 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	75.6	61.4
TTM Earnings per share	Rs	10.0	6.4
Diluted earnings per share	Rs	5.0	6.4
Price to Cash Flow	x	57.7	71.4
TTM P/E ratio	x	65.7	34.4
Price / Book Value ratio	x	6.4	19.6
Market Cap	Rs m	131,779	489,088
Dividends per share (Unadj.)	Rs	2.0	0.3

Ratio Analysis for VAKRANGEE

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 7.2x during FY18, from 10.6x 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 improved and stood at 100.4x during FY18, from 17.5x 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 27.2% during FY18, from 25.9% 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 declined and down at 41.4% during FY18, from 42.9% 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 declined and down at 23.2% during FY18, from 25.6% 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	10.6	7.2
Debtors’ Days	Days	752	734
Interest coverage	x	17.5	100.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	25.6	23.2
Return on equity	%	25.9	27.2
Return on capital employed	%	42.9	41.4

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

VAKRANGEE Share Price Performance

Over the last one year, VAKRANGEE share price has moved down from Rs 329.2 to Rs 221.2, registering a loss of Rs 108.0 or around 32.8%.

Meanwhile, the S&P BSE IT Index is trading at Rs 12,100.6 (down 0.3%). Over the last one year it has moved up from 10,365.5 to 12,100.6, a gain of 1,735 points (up 16.7%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of VAKRANGEE