ARCHEAN CHEMICAL 2022-23 Annual Report Analysis

Sun, 9 Jul

ARCHEAN CHEMICAL 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.

ARCHEAN CHEMICAL Income Statement Analysis

• Operating income during the year rose 27.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 35.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 44.0% in FY23 as against 41.3% in FY22.
• Depreciation charges increased by 2.6% and finance costs decreased by 40.0% YoY, respectively.
• Other income grew by 249.2% YoY.
• Net profit for the year grew by 103.3% YoY.
• Net profit margins during the year grew from 16.6% in FY22 to 26.5% in FY23.

ARCHEAN CHEMICAL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	11,304	14,411	27.5%
Other income	Rs m	124	433	249.2%
Total Revenues	Rs m	11,428	14,843	29.9%
Gross profit	Rs m	4,672	6,340	35.7%
Depreciation	Rs m	669	686	2.6%
Interest	Rs m	1,617	970	-40.0%
Profit before tax	Rs m	2,510	5,117	103.8%
Tax	Rs m	628	1,291	105.6%
Profit after tax	Rs m	1,882	3,826	103.3%
Gross profit margin	%	41.3	44.0
Effective tax rate	%	25.0	25.2
Net profit margin	%	16.6	26.5

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ARCHEAN CHEMICAL Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 10.0%.
• Long-term debt down at Rs 8 million as compared to Rs 8 billion during FY22, a fall of 99.9%.
• Current assets rose 50% and stood at Rs 6 billion, while fixed assets rose 4% and stood at Rs 12 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 18 billion as against Rs 15 billion during FY22, thereby witnessing a growth of 16%.

ARCHEAN CHEMICAL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	2,623	14,234	442.7
Current Liabilities	Rs m	1,756	1,932	10.0
Long-term Debt	Rs m	8,428	8	-99.9
Total Liabilities	Rs m	15,313	17,759	16.0
Current assets	Rs m	3,986	5,978	50.0
Fixed Assets	Rs m	11,327	11,781	4.0
Total Assets	Rs m	15,313	17,759	16.0

ARCHEAN CHEMICAL Cash Flow Statement Analysis

• ARCHEAN CHEMICAL's cash flow from operating activities (CFO) during FY23 stood at Rs 5 billion, an improvement of 57.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -3 billion, an improvement of 163.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion, an improvement of 5% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -62 million from the Rs -193 million net cash flows seen during FY22.

ARCHEAN CHEMICAL 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	3,145	4,961	57.7%
Cash Flow from Investing Activities	Rs m	-1,101	-2,903	-
Cash Flow from Financing Activities	Rs m	-2,237	-2,120	-
Net Cash Flow	Rs m	-193	-62	-

Current Valuations for ARCHEAN CHEMICAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 31.1, an improvement from the EPS of Rs 19.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 534.8, stands at 17.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.6 times, while the price to sales ratio stands at 4.6 times.
• The company's price to cash flow (P/CF) ratio stood at 16.0 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	117.4	117.1
TTM Earnings per share	Rs	19.5	31.1
Diluted earnings per share	Rs	15.3	31.1
Price to Cash Flow	x	0.0	16.0
TTM P/E ratio	x	0.0	17.2
Price / Book Value ratio	x	0.0	5.1
Market Cap	Rs m	0	72,097
Dividends per share (Unadj.)	Rs	0.0	2.5

Ratio Analysis for ARCHEAN CHEMICAL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.1x during FY23, from 2.3x 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 improved and stood at 6.3x during FY23, from 2.6x 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 26.9% during FY23, from 71.8% 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 improved and stood at 42.7% during FY23, from 37.3% 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 improved and stood at 27.0% during FY23, from 22.8% 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	2.3	3.1
Debtors’ Days	Days	494	298
Interest coverage	x	2.6	6.3
Debt to equity ratio	x	3.2	0.0
Return on assets	%	22.8	27.0
Return on equity	%	71.8	26.9
Return on capital employed	%	37.3	42.7

To see how ARCHEAN CHEMICAL has performed over the last 5 years, please visit here.

ARCHEAN CHEMICAL Share Price Performance

Over the last one year, ARCHEAN CHEMICAL share price has moved up from Rs 0.0 to Rs 534.8, registering a gain of Rs 534.8 or around 0.0%.

Overall, the S&P BSE SENSEX is up 22.9% over the year.

(To know more, check out historical annual results for ARCHEAN CHEMICAL and quarterly results for ARCHEAN CHEMICAL)