VA TECH WABAG 2022-23 Annual Report Analysis

Mon, 24 Jul

VA TECH WABAG 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.

VA TECH WABAG Income Statement Analysis

• Operating income during the year fell 0.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 83.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 1.3% in FY23 as against 7.8% in FY22.
• Depreciation charges decreased by 13.0% and finance costs decreased by 25.0% YoY, respectively.
• Other income grew by 61.3% YoY.
• Net profit for the year declined by 91.7% YoY.
• Net profit margins during the year declined from 4.4% in FY22 to 0.4% in FY23.

VA TECH WABAG Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	29,793	29,605	-0.6%
Other income	Rs m	333	537	61.3%
Total Revenues	Rs m	30,126	30,142	0.1%
Gross profit	Rs m	2,329	377	-83.8%
Depreciation	Rs m	101	88	-13.0%
Interest	Rs m	877	658	-25.0%
Profit before tax	Rs m	1,684	168	-90.0%
Tax	Rs m	363	59	-83.8%
Profit after tax	Rs m	1,321	109	-91.7%
Gross profit margin	%	7.8	1.3
Effective tax rate	%	21.6	35.1
Net profit margin	%	4.4	0.4

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VA TECH WABAG Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 22 billion as compared to Rs 22 billion in FY22, thereby witnessing an increase of 3.4%.
• Long-term debt down at Rs 550 million as compared to Rs 936 million during FY22, a fall of 41.2%.
• Current assets rose 1% and stood at Rs 30 billion, while fixed assets fell 2% and stood at Rs 10 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 41 billion as against Rs 40 billion during FY22, thereby witnessing a growth of 2%.

VA TECH WABAG Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	15,391	15,749	2.3
Current Liabilities	Rs m	21,693	22,420	3.4
Long-term Debt	Rs m	936	550	-41.2
Total Liabilities	Rs m	39,662	40,521	2.2
Current assets	Rs m	29,638	29,887	0.8
Fixed Assets	Rs m	10,024	9,804	-2.2
Total Assets	Rs m	39,662	40,521	2.2

VA TECH WABAG Cash Flow Statement Analysis

• VA TECH WABAG's cash flow from operating activities (CFO) during FY23 stood at Rs 850 million, an improvement of 630.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 158 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -1 billion from the Rs 213 million net cash flows seen during FY22.

VA TECH WABAG 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	116	850	630.1%
Cash Flow from Investing Activities	Rs m	-340	158	-
Cash Flow from Financing Activities	Rs m	446	-2,401	-
Net Cash Flow	Rs m	213	-1,144	-

Current Valuations for VA TECH WABAG

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 1.8, an decline from the EPS of Rs 21.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 513.7, stands at 1,901.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 93.7 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	479.1	476.0
TTM Earnings per share	Rs	21.2	1.8
Diluted earnings per share	Rs	21.2	1.8
Price to Cash Flow	x	12.3	93.7
TTM P/E ratio	x	12.9	1,901.4
Price / Book Value ratio	x	1.3	1.2
Market Cap	Rs m	19,722	18,499
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for VA TECH WABAG

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY23, from 1.4x 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 1.3x during FY23, from 2.9x 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 0.7% during FY23, from 8.6% 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 5.1% during FY23, from 15.7% 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 1.9% during FY23, from 5.5% 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	1.4	1.3
Debtors’ Days	Days	1,624	1,858
Interest coverage	x	2.9	1.3
Debt to equity ratio	x	0.1	0.0
Return on assets	%	5.5	1.9
Return on equity	%	8.6	0.7
Return on capital employed	%	15.7	5.1

To see how VA TECH WABAG has performed over the last 5 years, please visit here.

VA TECH WABAG Share Price Performance

Over the last one year, VA TECH WABAG share price has moved up from Rs 255.0 to Rs 513.7, registering a gain of Rs 258.7 or around 101.4%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 42,734.2 (up 0.8%). Over the last one year it has moved up from 29,009.4 to 42,734.2, a gain of 13,725 points (up 47.3%).

Overall, the S&P BSE SENSEX is up 19.8% over the year.

(To know more, check out historical annual results for VA TECH WABAG and quarterly results for VA TECH WABAG)