V GUARD INDUSTRIES 2018-19 Annual Report Analysis

Sun, 31 Mar

V GUARD INDUSTRIES 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.

V GUARD INDUSTRIES Income Statement Analysis

• Operating income during the year rose 12.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 17.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 8.6% in FY19 as against 8.2% in FY18.
• Depreciation charges increased by 16.9% and finance costs decreased by 13.8% YoY, respectively.
• Other income grew by 81.6% YoY.
• Net profit for the year grew by 24.4% YoY.
• Net profit margins during the year grew from 5.8% in FY18 to 6.5% in FY19.

V GUARD INDUSTRIES Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	23,162	25,940	12.0%
Other income	Rs m	110	201	81.6%
Total Revenues	Rs m	23,272	26,141	12.3%
Gross profit	Rs m	1,904	2,243	17.8%
Depreciation	Rs m	197	230	16.9%
Interest	Rs m	20	18	-13.8%
Profit before tax	Rs m	1,797	2,196	22.2%
Tax	Rs m	446	515	15.5%
Profit after tax	Rs m	1,351	1,680	24.4%
Gross profit margin	%	8.2	8.6
Effective tax rate	%	24.8	23.5
Net profit margin	%	5.8	6.5

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V GUARD INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 5 billion as compared to Rs 4 billion in FY18, thereby witnessing an increase of 11.6%.
• Current assets rose 19% and stood at Rs 11 billion, while fixed assets rose 12% and stood at Rs 3 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 14 billion as against Rs 12 billion during FY18, thereby witnessing a growth of 17%.

V GUARD INDUSTRIES Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	7,164	8,571	19.7
Current Liabilities	Rs m	4,050	4,520	11.6
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	11,708	13,717	17.2
Current assets	Rs m	9,162	10,861	18.5
Fixed Assets	Rs m	2,545	2,855	12.2
Total Assets	Rs m	11,708	13,717	17.2

V GUARD INDUSTRIES Cash Flow Statement Analysis

• V GUARD INDUSTRIES's cash flow from operating activities (CFO) during FY19 stood at Rs 2 billion, an improvement of 199.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -508 million, an improvement of 106.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -252 million, an improvement of 32% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 803 million from the Rs -96 million net cash flows seen during FY18.

V GUARD INDUSTRIES 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	522	1,562	199.0%
Cash Flow from Investing Activities	Rs m	-246	-508	-
Cash Flow from Financing Activities	Rs m	-372	-252	-
Net Cash Flow	Rs m	-96	803	-

Current Valuations for V GUARD INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 3.9, an improvement from the EPS of Rs 3.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 221.4, stands at 57.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 11.1 times, while the price to sales ratio stands at 3.6 times.
• The company's price to cash flow (P/CF) ratio stood at 46.3 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	54.4	60.8
TTM Earnings per share	Rs	3.2	3.9
Diluted earnings per share	Rs	3.1	3.9
Price to Cash Flow	x	62.0	46.3
TTM P/E ratio	x	72.1	57.7
Price / Book Value ratio	x	12.4	10.3
Market Cap	Rs m	88,562	88,375
Dividends per share (Unadj.)	Rs	0.7	0.8

Ratio Analysis for V GUARD INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.4x during FY19, from 2.3x 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 improved and stood at 125.8x during FY19, from 89.0x 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 improved and stood at 19.6% during FY19, from 18.9% 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 improved and stood at 25.8% during FY19, from 25.4% 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 12.4% during FY19, from 11.7% 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	2.3	2.4
Debtors’ Days	Days	708	646
Interest coverage	x	89.0	125.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.7	12.4
Return on equity	%	18.9	19.6
Return on capital employed	%	25.4	25.8

To see how V GUARD INDUSTRIES has performed over the last 5 years, please visit here.

V GUARD INDUSTRIES Share Price Performance

Over the last one year, V GUARD INDUSTRIES share price has moved down from Rs 222.3 to Rs 221.4, registering a loss of Rs 0.9 or around 0.4%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 18,472.0 (up 0.5%). Over the last one year it has moved down from 18,476.7 to 18,472.0, a loss of 5 points (down 0.0%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

(To know more, check out historical annual results for V GUARD INDUSTRIES and quarterly results for V GUARD INDUSTRIES)

Read: Latest Annual Report Analysis of V GUARD INDUSTRIES