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INFOSYS LTD 2017-18 Annual Report Analysis

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INFOSYS LTD 2017-18 Annual Report Analysis
Wed, 8 Aug

INFOSYS LTD 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.

INFOSYS LTD Income Statement Analysis

  • Operating income during the year rose 3.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 2.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 27.0% in FY18 as against 27.2% in FY17.
  • Depreciation charges increased by 9.4% YoY.
  • Other income grew by 3.7% YoY.
  • Net profit for the year grew by 11.7% YoY.
  • Net profit margins during the year grew from 20.1% in FY17 to 21.7% in FY18.

INFOSYS LTD Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 684,840 705,220 3.0%
Other income Rs m 30,800 31,930 3.7%
Total Revenues Rs m 715,640 737,150 3.0%
Gross profit Rs m 186,040 190,110 2.2%
Depreciation Rs m 17,030 18,630 9.4%
Interest Rs m 0 0 0.0%
Profit before tax Rs m 199,810 203,410 1.8%
Tax Rs m 55,980 42,410 -24.2%
Profit after tax Rs m 143,530 160,290 11.7%
Gross profit margin % 27.2 27.0
Effective tax rate % 28.0 20.8
Net profit margin % 20.1 21.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



INFOSYS LTD Balance Sheet Analysis

  • The company's current liabilities during FY18 stood at Rs 141 billion as compared to Rs 140 billion in FY17, thereby witnessing an increase of 0.7%.
  • Current assets fell 7% and stood at Rs 500 billion, while fixed assets fell 9% and stood at Rs 142 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 799 billion as against Rs 834 billion during FY17, thereby witnessing a fall of 4%.

INFOSYS LTD Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 689,820 649,230 -5.9
 
Current Liabilities Rs m 140,130 141,050 0.7
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 833,550 798,900 -4.2
 
Current assets Rs m 537,050 500,170 -6.9
Fixed Assets Rs m 156,150 141,800 -9.2
Total Assets Rs m 833,550 798,900 -4.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



INFOSYS LTD Cash Flow Statement Analysis

  • INFOSYS LTD's cash flow from operating activities (CFO) during FY18 stood at Rs 132 billion, an improvement of 14.6% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs 45 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs -205 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs -28 billion from the Rs -101 billion net cash flows seen during FY17.

INFOSYS LTD 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 115,310 132,180 14.6%
Cash Flow from Investing Activities Rs m -145,420 44,520 -
Cash Flow from Financing Activities Rs m -69,390 -205,050 -
Net Cash Flow Rs m -100,720 -27,540 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for INFOSYS LTD

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 73.4, an improvement from the EPS of Rs 62.5 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,365.0, stands at 19.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.5 times, while the price to sales ratio stands at 3.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.5 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 298.2 322.9
TTM Earnings per share Rs 62.5 73.4
Diluted earnings per share Rs 62.5 69.8
Price to Cash Flow x 19.5 17.5
TTM P/E ratio x 19.4 19.4
Price / Book Value ratio x 3.6 3.5
Market Cap Rs m 3,135,208 3,135,236
Dividends per share (Unadj.) Rs 25.8 43.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for INFOSYS LTD

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.5x during FY18, from 3.8x during FY17. The current ratio measures the company's ability to pay short-term and long-term obligations.

  • Profitability Ratios
  • Return on Equity (ROE): The ROE for the company improved and stood at 24.7% during FY18, from 20.8% 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 improved and stood at 31.2% during FY18, from 28.9% 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 improved and stood at 20.1% during FY18, from 17.2% 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 3.8 3.5
Debtors’ Days Days 66 68
Interest coverage x 0.0 0.0
Debt to equity ratio x 0.0 0.0
Return on assets % 17.2 20.1
Return on equity % 20.8 24.7
Return on capital employed % 28.9 31.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how INFOSYS LTD has performed over the last 5 years, please visit here.

INFOSYS LTD Share Price Performance

Over the last one year, INFOSYS LTD share price has moved up from Rs 964.6 to Rs 1,365.0, registering a gain of Rs 400.4 or around 41.5%.

Meanwhile, the S&P BSE IT Index is trading at Rs 14,566.6 (down 0.1%). Over the last one year it has moved up from 10,222.5 to 14,566.6, a gain of 4,344 points (up 42.5%).

Overall, the S&P BSE SENSEX is up 17.4% over the year.

(To know more, check out historical annual results for INFOSYS LTD and quarterly results for INFOSYS LTD)

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For the quarter ended December 2018, INFOSYS LTD has posted a net profit of Rs 36 bn (down 29.6% YoY). Sales on the other hand came in at Rs 214 bn (up 20.3% YoY). Read on for a complete analysis of INFOSYS LTD's quarterly results.

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