A-1 ACID 2021-22 Annual Report Analysis

Fri, 24 Jun

A-1 ACID has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

A-1 ACID Income Statement Analysis

• Operating income during the year rose 113.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 146.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 2.9% in FY22 as against 2.5% in FY21.
• Depreciation charges increased by 19.2% and finance costs increased by 67.4% YoY, respectively.
• Other income grew by 4.7% YoY.
• Net profit for the year grew by 136.3% YoY.
• Net profit margins during the year grew from 1.9% in FY21 to 2.1% in FY22.

A-1 ACID Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	1,452	3,104	113.8%
Other income	Rs m	41	43	4.7%
Total Revenues	Rs m	1,492	3,146	110.8%
Gross profit	Rs m	36	89	146.4%
Depreciation	Rs m	28	33	19.2%
Interest	Rs m	7	12	67.4%
Profit before tax	Rs m	42	86	107.7%
Tax	Rs m	14	22	52.9%
Profit after tax	Rs m	27	65	136.3%
Gross profit margin	%	2.5	2.9
Effective tax rate	%	34.3	25.2
Net profit margin	%	1.9	2.1

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A-1 ACID Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 294 million as compared to Rs 174 million in FY21, thereby witnessing an increase of 68.9%.
• Long-term debt stood at Rs 55 million as compared to Rs 36 million during FY21, a growth of 49.5%.
• Current assets rose 27% and stood at Rs 575 million, while fixed assets rose 42% and stood at Rs 253 million in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 828 million as against Rs 629 million during FY21, thereby witnessing a growth of 32%.

A-1 ACID Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	402	465	15.7
Current Liabilities	Rs m	174	294	68.9
Long-term Debt	Rs m	36	55	49.5
Total Liabilities	Rs m	629	828	31.7
Current assets	Rs m	451	575	27.4
Fixed Assets	Rs m	177	253	42.5
Total Assets	Rs m	629	828	31.7

A-1 ACID Cash Flow Statement Analysis

• A-1 ACID's cash flow from operating activities (CFO) during FY22 stood at Rs -2 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -91 million, an improvement of 62.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs 89 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs -4 million from the Rs -1 million net cash flows seen during FY21.

A-1 ACID Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	-39	-2	-
Cash Flow from Investing Activities	Rs m	-56	-91	-
Cash Flow from Financing Activities	Rs m	94	89	-5.3%
Net Cash Flow	Rs m	-1	-4	-

Current Valuations for A-1 ACID

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.6, an improvement from the EPS of Rs 2.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 292.0, stands at 52.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.2 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 21.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	145.2	269.9
TTM Earnings per share	Rs	2.7	5.6
Diluted earnings per share	Rs	2.4	5.6
Price to Cash Flow	x	20.7	21.0
TTM P/E ratio	x	42.1	52.1
Price / Book Value ratio	x	1.9	4.4
Market Cap	Rs m	763	2,058
Dividends per share (Unadj.)	Rs	0.0	1.5

Ratio Analysis for A-1 ACID

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.0x during FY22, from 2.6x during FY21. 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 8.1x during FY22, from 6.8x during FY21. 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 improved and stood at 13.9% during FY22, from 6.8% during FY22. 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 18.9% during FY22, from 11.1% during FY21. 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 9.3% during FY22, from 5.5% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	2.6	2.0
Debtors’ Days	Days	912	545
Interest coverage	x	6.8	8.1
Debt to equity ratio	x	0.1	0.1
Return on assets	%	5.5	9.3
Return on equity	%	6.8	13.9
Return on capital employed	%	11.1	18.9

To see how A-1 ACID has performed over the last 5 years, please visit here.

A-1 ACID Share Price Performance

Over the last one year, A-1 ACID share price has moved up from Rs 121.0 to Rs 292.0, registering a gain of Rs 171.0 or around 141.3%.

Overall, the S&P BSE SENSEX is up 0.1% over the year.

(To know more, check out historical annual results for A-1 ACID and quarterly results for A-1 ACID)