ACC 2020-21 Annual Report Analysis

Fri, 31 Dec

ACC has announced its results for the year ended December 2021. Let us have a look at the detailed performance review of the company during FY20-21.

ACC Income Statement Analysis

• Operating income during the year rose 17.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 33.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 18.0% in CY21 as against 15.8% in CY20.
• Depreciation charges decreased by 6.0% and finance costs decreased by 4.3% YoY, respectively.
• Other income grew by 11.1% YoY.
• Net profit for the year grew by 30.3% YoY.
• Net profit margins during the year grew from 10.3% in CY20 to 11.5% in CY21.

ACC Income Statement 2020-21

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*	% Change
Net Sales	Rs m	137,860	161,517	17.2%
Other income	Rs m	2,178	2,420	11.1%
Total Revenues	Rs m	140,037	163,937	17.1%
Gross profit	Rs m	21,781	29,080	33.5%
Depreciation	Rs m	6,388	6,007	-6.0%
Interest	Rs m	571	546	-4.3%
Profit before tax	Rs m	16,999	24,947	46.8%
Tax	Rs m	2,786	6,433	130.9%
Profit after tax	Rs m	14,213	18,515	30.3%
Gross profit margin	%	15.8	18.0
Effective tax rate	%	16.4	25.8
Net profit margin	%	10.3	11.5

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ACC Balance Sheet Analysis

• The company's current liabilities during CY21 stood at Rs 60 billion as compared to Rs 48 billion in CY20, thereby witnessing an increase of 25.0%.
• Current assets rose 23% and stood at Rs 104 billion, while fixed assets rose 9% and stood at Rs 107 billion in CY21.
• Overall, the total assets and liabilities for CY21 stood at Rs 210 billion as against Rs 182 billion during CY20, thereby witnessing a growth of 16%.

ACC Balance Sheet as on December 2021

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*	% Change
Networth	Rs m	126,991	143,088	12.7
Current Liabilities	Rs m	48,043	60,060	25.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	182,002	210,388	15.6
Current assets	Rs m	84,486	103,694	22.7
Fixed Assets	Rs m	97,516	106,695	9.4
Total Assets	Rs m	182,002	210,388	15.6

ACC Cash Flow Statement Analysis

• ACC 's cash flow from operating activities (CFO) during CY21 stood at Rs 28 billion, an improvement of 27.8% on a YoY basis.
• Cash flow from investing activities (CFI) during CY21 stood at Rs -10 billion, an improvement of 84.6% on a YoY basis.
• Cash flow from financial activities (CFF) during CY21 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during CY21 stood at Rs 15 billion from the Rs 14 billion net cash flows seen during CY20.

ACC Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Dec-20	Dec-21
Cash Flow from Operating Activities	Rs m	22,192	28,355	27.8%
Cash Flow from Investing Activities	Rs m	-5,352	-9,880	-
Cash Flow from Financing Activities	Rs m	-3,274	-3,305	-
Net Cash Flow	Rs m	13,568	15,172	11.8%

Current Valuations for ACC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 98.6, an improvement from the EPS of Rs 75.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,236.8, stands at 24.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.7 times, while the price to sales ratio stands at 2.4 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 Dec-20*	12 Dec-21*
Sales per share (Unadj.)	Rs	734.1	860.1
TTM Earnings per share	Rs	75.7	98.6
Diluted earnings per share	Rs	75.7	98.6
Price to Cash Flow	x	17.0	16.0
TTM P/E ratio	x	22.5	24.9
Price / Book Value ratio	x	2.0	2.7
Market Cap	Rs m	251,968	391,752
Dividends per share (Unadj.)	Rs	14.0	58.0

Ratio Analysis for ACC

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.7x during CY21, from 1.8x during CY20. 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 46.7x during CY21, from 30.8x during CY20. 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 12.9% during CY21, from 11.2% during CY21. 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 17.8% during CY21, from 13.8% during CY20. 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 9.1% during CY21, from 8.1% during CY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Dec-20*	12 Dec-21*
Current ratio	x	1.8	1.7
Debtors’ Days	Days	1	1
Interest coverage	x	30.8	46.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	8.1	9.1
Return on equity	%	11.2	12.9
Return on capital employed	%	13.8	17.8

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

ACC Share Price Performance

Over the last one year, ACC share price has moved up from Rs 1,958.2 to Rs 2,236.8, registering a gain of Rs 278.6 or around 14.2%.

Overall, the S&P BSE SENSEX is up 8.2% over the year.

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