VINYL CHEMICALS 2022-23 Annual Report Analysis

Mon, 17 Jul

VINYL CHEMICALS 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.

VINYL CHEMICALS Income Statement Analysis

• Operating income during the year rose 17.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 5.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 4.6% in FY23 as against 5.1% in FY22.
• Depreciation charges increased by 1566.7% and finance costs increased by 719.4% YoY, respectively.
• Other income declined by 8.4% YoY.
• Net profit for the year grew by 2.2% YoY.
• Net profit margins during the year declined from 4.0% in FY22 to 3.5% in FY23.

VINYL CHEMICALS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	8,651	10,125	17.0%
Other income	Rs m	25	23	-8.4%
Total Revenues	Rs m	8,675	10,148	17.0%
Gross profit	Rs m	444	467	5.2%
Depreciation	Rs m	0	1	1,566.7%
Interest	Rs m	2	14	719.4%
Profit before tax	Rs m	467	475	1.8%
Tax	Rs m	118	119	0.4%
Profit after tax	Rs m	349	356	2.2%
Gross profit margin	%	5.1	4.6
Effective tax rate	%	25.3	25.0
Net profit margin	%	4.0	3.5

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VINYL CHEMICALS Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 734 million as compared to Rs 782 million in FY22, thereby witnessing an decrease of -6.2%.
• Long-term debt down at Rs 5 million as compared to Rs 5 million during FY22, a fall of 0.0%.
• Current assets rose 7% and stood at Rs 2 billion, while fixed assets rose 19% and stood at Rs 13 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 2 billion as against Rs 2 billion during FY22, thereby witnessing a growth of 7%.

VINYL CHEMICALS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	960	1,133	18.0
Current Liabilities	Rs m	782	734	-6.2
Long-term Debt	Rs m	5	5	0.0
Total Liabilities	Rs m	1,750	1,874	7.1
Current assets	Rs m	1,738	1,861	7.1
Fixed Assets	Rs m	11	13	19.2
Total Assets	Rs m	1,750	1,874	7.1

VINYL CHEMICALS Cash Flow Statement Analysis

• VINYL CHEMICALS's cash flow from operating activities (CFO) during FY23 stood at Rs -212 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 405 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -186 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 6 million from the Rs -109 million net cash flows seen during FY22.

VINYL CHEMICALS 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	168	-212	-
Cash Flow from Investing Activities	Rs m	-209	405	-
Cash Flow from Financing Activities	Rs m	-69	-186	-
Net Cash Flow	Rs m	-109	6	-

Current Valuations for VINYL CHEMICALS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.4, an improvement from the EPS of Rs 19.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 501.4, stands at 25.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 8.1 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 30.4 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	471.7	552.1
TTM Earnings per share	Rs	19.0	19.4
Diluted earnings per share	Rs	19.0	19.4
Price to Cash Flow	x	13.8	30.4
TTM P/E ratio	x	13.8	25.8
Price / Book Value ratio	x	4.2	9.6
Market Cap	Rs m	4,044	10,885
Dividends per share (Unadj.)	Rs	10.0	10.0

Ratio Analysis for VINYL CHEMICALS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.5x during FY23, from 2.2x 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 36.1x during FY23, from 283.9x 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 31.5% during FY23, from 36.3% 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 42.9% during FY23, from 48.5% 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 19.7% during FY23, from 20.0% 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	2.2	2.5
Debtors’ Days	Days	47	113
Interest coverage	x	283.9	36.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	20.0	19.7
Return on equity	%	36.3	31.5
Return on capital employed	%	48.5	42.9

To see how VINYL CHEMICALS has performed over the last 5 years, please visit here.

VINYL CHEMICALS Share Price Performance

Over the last one year, VINYL CHEMICALS share price has moved up from Rs 292.2 to Rs 501.4, registering a gain of Rs 209.2 or around 71.6%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 19,137.2 (up 0.4%). Over the last one year it has moved up from 18,058.3 to 19,137.2, a gain of 1,079 points (up 6.0%).

Overall, the S&P BSE SENSEX is up 24.4% over the year.

(To know more, check out historical annual results for VINYL CHEMICALS and quarterly results for VINYL CHEMICALS)