VINATI ORGANICS 2017-18 Annual Report Analysis

Sat, 31 Mar

VINATI ORGANICS 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.

VINATI ORGANICS Income Statement Analysis

• Operating income during the year rose 19.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 9.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 27.6% in FY18 as against 36.3% in FY17.
• Depreciation charges increased by 8.1% and finance costs decreased by 21.0% YoY, respectively.
• Other income grew by 145.9% YoY.
• Net profit for the year grew by 2.6% YoY.
• Net profit margins during the year declined from 23.4% in FY17 to 20.1% in FY18.

VINATI ORGANICS Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	6,003	7,172	19.5%
Other income	Rs m	125	307	145.9%
Total Revenues	Rs m	6,127	7,479	22.1%
Gross profit	Rs m	2,178	1,982	-9.0%
Depreciation	Rs m	216	234	8.1%
Interest	Rs m	28	22	-21.0%
Profit before tax	Rs m	2,060	2,034	-1.3%
Tax	Rs m	657	595	-9.4%
Profit after tax	Rs m	1,403	1,439	2.6%
Gross profit margin	%	36.3	27.6
Effective tax rate	%	31.9	29.3
Net profit margin	%	23.4	20.1

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VINATI ORGANICS Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 993 million as compared to Rs 534 million in FY17, thereby witnessing an increase of 85.9%.
• Current assets rose 42% and stood at Rs 5 billion, while fixed assets rose 5% and stood at Rs 5 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 10 billion as against Rs 8 billion during FY17, thereby witnessing a growth of 19%.

VINATI ORGANICS Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	6,800	7,967	17.2
Current Liabilities	Rs m	534	993	85.9
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	8,211	9,800	19.3
Current assets	Rs m	3,270	4,629	41.5
Fixed Assets	Rs m	4,941	5,171	4.7
Total Assets	Rs m	8,211	9,800	19.3

VINATI ORGANICS Cash Flow Statement Analysis

• VINATI ORGANICS's cash flow from operating activities (CFO) during FY18 stood at Rs 1 billion, an improvement of 6.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -388 million, an improvement of 44.8% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -299 million, an improvement of 34% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 697 million from the Rs 586 million net cash flows seen during FY17.

VINATI ORGANICS 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	1,304	1,383	6.1%
Cash Flow from Investing Activities	Rs m	-268	-388	-
Cash Flow from Financing Activities	Rs m	-451	-299	-
Net Cash Flow	Rs m	586	697	19.0%

Current Valuations for VINATI ORGANICS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 28.0, an improvement from the EPS of Rs 27.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 900.0, stands at 64.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 11.6 times, while the price to sales ratio stands at 6.4 times.
• The company's price to cash flow (P/CF) ratio stood at 28.3 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	116.4	139.6
TTM Earnings per share	Rs	27.2	28.0
Diluted earnings per share	Rs	13.6	14.0
Price to Cash Flow	x	47.9	28.3
TTM P/E ratio	x	55.7	64.3
Price / Book Value ratio	x	4.4	5.9
Market Cap	Rs m	30,000	47,383
Dividends per share (Unadj.)	Rs	0.3	2.3

Ratio Analysis for VINATI ORGANICS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 4.7x during FY18, from 6.1x 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 94.5x during FY18, from 75.8x 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 declined and down at 18.1% during FY18, from 20.6% 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 25.8% during FY18, from 30.7% 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 14.9% during FY18, from 17.4% 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	6.1	4.7
Debtors’ Days	Days	855	901
Interest coverage	x	75.8	94.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	17.4	14.9
Return on equity	%	20.6	18.1
Return on capital employed	%	30.7	25.8

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

VINATI ORGANICS Share Price Performance

Over the last one year, VINATI ORGANICS share price has moved up from Rs 754.3 to Rs 900.0, registering a gain of Rs 145.7 or around 19.3%.

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

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

Read: Latest Annual Report Analysis of VINATI ORGANICS