VIP INDUSTRIES 2020-21 Annual Report Analysis

Wed, 31 Mar

VIP INDUSTRIES has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

VIP INDUSTRIES Income Statement Analysis

• Operating income during the year fell 63.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 126.0% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 10.4% in FY21 as against 14.4% in FY20.
• Depreciation charges decreased by 10.2% and finance costs increased by 22.0% YoY, respectively.
• Other income grew by 272.4% YoY.
• Net profit for the year declined by 187.3% YoY.
• Net profit margins during the year declined from 6.5% in FY20 to 15.8% in FY21.

VIP INDUSTRIES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	17,144	6,186	-63.9%
Other income	Rs m	130	486	272.4%
Total Revenues	Rs m	17,274	6,671	-61.4%
Gross profit	Rs m	2,474	-644	-126.0%
Depreciation	Rs m	868	779	-10.2%
Interest	Rs m	252	308	22.0%
Profit before tax	Rs m	1,484	-1,246	-184.0%
Tax	Rs m	367	-271	-173.9%
Profit after tax	Rs m	1,117	-975	-187.3%
Gross profit margin	%	14.4	-10.4
Effective tax rate	%	24.7	21.8
Net profit margin	%	6.5	-15.8

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VIP INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 4 billion as compared to Rs 4 billion in FY20, thereby witnessing an decrease of -8.2%.
• Current assets fell 11% and stood at Rs 7 billion, while fixed assets fell 21% and stood at Rs 3 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 11 billion as against Rs 12 billion during FY20, thereby witnessing a fall of 14%.

VIP INDUSTRIES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	6,072	5,123	-15.6
Current Liabilities	Rs m	4,378	4,020	-8.2
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	12,365	10,609	-14.2
Current assets	Rs m	8,284	7,384	-10.9
Fixed Assets	Rs m	4,081	3,226	-21.0
Total Assets	Rs m	12,365	10,609	-14.2

VIP INDUSTRIES Cash Flow Statement Analysis

• VIP INDUSTRIES's cash flow from operating activities (CFO) during FY21 stood at Rs 170 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -756 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 721 million, an improvement of 134% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 135 million from the Rs -40 million net cash flows seen during FY20.

VIP INDUSTRIES Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	2,920	170	-94.2%
Cash Flow from Investing Activities	Rs m	-850	-756	-
Cash Flow from Financing Activities	Rs m	-2,109	721	-
Net Cash Flow	Rs m	-40	135	-

Current Valuations for VIP INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -6.9, an decline from the EPS of Rs 7.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 354.2, stands at -51.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.8 times, while the price to sales ratio stands at 8.1 times.
• The company's price to cash flow (P/CF) ratio stood at -225.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	121.3	43.8
TTM Earnings per share	Rs	7.9	-6.9
Diluted earnings per share	Rs	7.9	-6.9
Price to Cash Flow	x	17.1	-225.9
TTM P/E ratio	x	30.4	-51.4
Price / Book Value ratio	x	8.2	8.6
Market Cap	Rs m	50,016	44,158
Dividends per share (Unadj.)	Rs	3.2	0.0

Ratio Analysis for VIP INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY21, from 1.9x during FY20. 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 -3.0x during FY21, from 6.9x during FY20. 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 -19.0% during FY21, from 18.4% during FY21. 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 -18.3% during FY21, from 28.6% during FY20. 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 -6.3% during FY21, from 11.1% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.9	1.8
Debtors’ Days	Days	6	9
Interest coverage	x	6.9	-3.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.1	-6.3
Return on equity	%	18.4	-19.0
Return on capital employed	%	28.6	-18.3

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

VIP INDUSTRIES Share Price Performance

Over the last one year, VIP INDUSTRIES share price has moved up from Rs 240.1 to Rs 354.2, registering a gain of Rs 114.2 or around 47.6%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 32,825.9 (up 0.8%). Over the last one year it has moved up from 19,363.0 to 32,825.9, a gain of 13,463 points (up 69.5%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of VIP INDUSTRIES