WELSPUN CORP 2018-19 Annual Report Analysis

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WELSPUN CORP 2018-19 Annual Report Analysis
Mon, 23 Sep

WELSPUN CORP has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

WELSPUN CORP Income Statement Analysis

  • Operating income during the year rose 41.9% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 3.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.5% in FY19 as against 9.6% in FY18.
  • Depreciation charges increased by 0.6% and finance costs decreased by 4.1% YoY, respectively.
  • Other income grew by 4.5% YoY.
  • Net profit for the year declined by 65.9% YoY.
  • Net profit margins during the year declined from 2.8% in FY18 to 0.7% in FY19.

WELSPUN CORP Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 61,142 86,751 41.9%
Other income Rs m 1,288 1,347 4.5%
Total Revenues Rs m 62,431 88,097 41.1%
Gross profit Rs m 5,885 5,659 -3.8%
Depreciation Rs m 2,582 2,597 0.6%
Interest Rs m 1,774 1,702 -4.1%
Profit before tax Rs m 2,818 2,706 -4.0%
Tax Rs m 202 1,223 504.9%
Profit after tax Rs m 1,757 598 -65.9%
Gross profit margin % 9.6 6.5
Effective tax rate % 7.2 45.2
Net profit margin % 2.8 0.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



WELSPUN CORP Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 39 billion as compared to Rs 28 billion in FY18, thereby witnessing an increase of 42.6%.
  • Long-term debt down at Rs 11 billion as compared to Rs 13 billion during FY18, a fall of 15.3%.
  • Current assets rose 49% and stood at Rs 62 billion, while fixed assets fell 47% and stood at Rs 17 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 82 billion as against Rs 77 billion during FY18, thereby witnessing a growth of 7%.

WELSPUN CORP Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 29,106 27,926 -4.1
 
Current Liabilities Rs m 27,680 39,468 42.6
Long-term Debt Rs m 12,717 10,778 -15.3
Total Liabilities Rs m 76,933 82,000 6.6
 
Current assets Rs m 41,224 61,562 49.3
Fixed Assets Rs m 31,768 16,739 -47.3
Total Assets Rs m 76,933 82,000 6.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



WELSPUN CORP Cash Flow Statement Analysis

  • WELSPUN CORP's cash flow from operating activities (CFO) during FY19 stood at Rs 6 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -3 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -3 billion, an improvement of 56% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 321 million from the Rs 4 billion net cash flows seen during FY18.

WELSPUN CORP Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 9,814 6,087 -38.0%
Cash Flow from Investing Activities Rs m 1,823 -2,676 -
Cash Flow from Financing Activities Rs m -7,609 -3,353 -
Net Cash Flow Rs m 4,047 321 -92.1%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for WELSPUN CORP

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.3, an decline from the EPS of Rs 6.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 135.9, stands at 37.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.3 times, while the price to sales ratio stands at 0.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 8.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 230.5 327.1
TTM Earnings per share Rs 6.6 2.3
Diluted earnings per share Rs 6.7 2.3
Price to Cash Flow x 6.9 8.8
TTM P/E ratio x 37.2 37.0
Price / Book Value ratio x 1.2 1.3
Market Cap Rs m 36,031 35,753
Dividends per share (Unadj.) Rs 0.5 0.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for WELSPUN CORP

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.6x during FY19, from 1.5x during FY18. 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 2.6x during FY19, from 2.6x during FY18. 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 2.1% during FY19, from 6.0% during FY19. 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 improved and stood at 9.1% during FY19, from 8.9% during FY18. 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 2.8% during FY19, from 4.6% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 1.5 1.6
Debtors’ Days Days 78 50
Interest coverage x 2.6 2.6
Debt to equity ratio x 0.4 0.4
Return on assets % 4.6 2.8
Return on equity % 6.0 2.1
Return on capital employed % 8.9 9.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how WELSPUN CORP has performed over the last 5 years, please visit here.

WELSPUN CORP Share Price Performance

Over the last one year, WELSPUN CORP share price has moved down from Rs 162.9 to Rs 135.9, registering a loss of Rs 27.0 or around 16.6%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 19,072.9 (up 5.5%). Over the last one year it has moved up from 18,058.2 to 19,072.9, a gain of 1,015 points (up 5.6%).

Overall, the S&P BSE SENSEX is up 5.3% over the year.

(To know more, check out historical annual results for WELSPUN CORP and quarterly results for WELSPUN CORP)

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