V GUARD INDUSTRIES 2022-23 Annual Report Analysis

Sun, 6 Aug

V GUARD INDUSTRIES 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.

V GUARD INDUSTRIES Income Statement Analysis

• Operating income during the year rose 17.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 6.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.8% in FY23 as against 9.7% in FY22.
• Depreciation charges increased by 31.1% and finance costs increased by 105.4% YoY, respectively.
• Other income grew by 52.7% YoY.
• Net profit for the year declined by 17.2% YoY.
• Net profit margins during the year declined from 6.5% in FY22 to 4.6% in FY23.

V GUARD INDUSTRIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	35,002	41,260	17.9%
Other income	Rs m	108	164	52.7%
Total Revenues	Rs m	35,110	41,425	18.0%
Gross profit	Rs m	3,402	3,199	-6.0%
Depreciation	Rs m	491	644	31.1%
Interest	Rs m	79	162	105.4%
Profit before tax	Rs m	2,940	2,557	-13.0%
Tax	Rs m	655	667	1.8%
Profit after tax	Rs m	2,284	1,890	-17.2%
Gross profit margin	%	9.7	7.8
Effective tax rate	%	22.3	26.1
Net profit margin	%	6.5	4.6

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V GUARD INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 8 billion as compared to Rs 6 billion in FY22, thereby witnessing an increase of 30.3%.
• Long-term debt stood at Rs 3 billion as compared to Rs 0 million during FY22, a fall of 0.0%.
• Current assets fell 2% and stood at Rs 15 billion, while fixed assets rose 146% and stood at Rs 14 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 29 billion as against Rs 21 billion during FY22, thereby witnessing a growth of 38%.

V GUARD INDUSTRIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	13,701	15,648	14.2
Current Liabilities	Rs m	6,266	8,167	30.3
Long-term Debt	Rs m	0	2,729	0.0
Total Liabilities	Rs m	20,977	28,987	38.2
Current assets	Rs m	15,304	15,052	-1.6
Fixed Assets	Rs m	5,674	13,935	145.6
Total Assets	Rs m	20,977	28,987	38.2

V GUARD INDUSTRIES Cash Flow Statement Analysis

• V GUARD INDUSTRIES's cash flow from operating activities (CFO) during FY23 stood at Rs 4 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -8 billion, an improvement of 538.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 3 billion, an improvement of 623% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -213 million from the Rs -2 billion net cash flows seen during FY22.

V GUARD INDUSTRIES 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	-368	4,238	-
Cash Flow from Investing Activities	Rs m	-1,208	-7,712	-
Cash Flow from Financing Activities	Rs m	-623	3,261	-
Net Cash Flow	Rs m	-2,200	-213	-

Current Valuations for V GUARD INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.4, an decline from the EPS of Rs 5.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 284.6, stands at 65.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.9 times, while the price to sales ratio stands at 3.0 times.
• The company's price to cash flow (P/CF) ratio stood at 40.1 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	81.1	95.5
TTM Earnings per share	Rs	5.3	4.4
Diluted earnings per share	Rs	5.3	4.4
Price to Cash Flow	x	33.7	40.1
TTM P/E ratio	x	41.0	65.3
Price / Book Value ratio	x	7.4	6.5
Market Cap	Rs m	100,743	101,583
Dividends per share (Unadj.)	Rs	1.3	1.3

Ratio Analysis for V GUARD INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY23, from 2.4x 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 deteriorated and stood at 16.8x during FY23, from 38.3x 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 declined and down at 12.1% during FY23, from 16.7% 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 declined and down at 14.8% during FY23, from 22.0% 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 declined and down at 7.1% during FY23, from 11.3% 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	2.4	1.8
Debtors’ Days	Days	505	503
Interest coverage	x	38.3	16.8
Debt to equity ratio	x	0.0	0.2
Return on assets	%	11.3	7.1
Return on equity	%	16.7	12.1
Return on capital employed	%	22.0	14.8

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 up from Rs 235.4 to Rs 284.6, registering a gain of Rs 49.2 or around 20.9%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 43,070.0 (up 0.7%). Over the last one year it has moved up from 29,698.7 to 43,070.0, a gain of 13,371 points (up 45.0%).

Overall, the S&P BSE SENSEX is up 12.6% over the year.

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