ARIHANT CAPITAL 2023-24 Annual Report Analysis

Tue, 1 Oct

ARIHANT CAPITAL has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during FY23-24.

ARIHANT CAPITAL Income Statement Analysis

• Operating income during the year rose 71.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 109.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 46.3% in FY24 as against 37.7% in FY23.
• Depreciation charges increased by 26.8% and finance costs increased by 31.3% YoY, respectively.
• Other income grew by 116.9% YoY.
• Net profit for the year grew by 142.2% YoY.
• Net profit margins during the year grew from 21.2% in FY23 to 30.0% in FY24.

ARIHANT CAPITAL Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	1,375	2,351	71.0%
Other income	Rs m	2	5	116.9%
Total Revenues	Rs m	1,378	2,356	71.0%
Gross profit	Rs m	519	1,089	109.8%
Depreciation	Rs m	19	24	26.8%
Interest	Rs m	108	142	31.3%
Profit before tax	Rs m	394	927	135.3%
Tax	Rs m	103	222	116.0%
Profit after tax	Rs m	291	705	142.2%
Gross profit margin	%	37.7	46.3
Effective tax rate	%	26.1	23.9
Net profit margin	%	21.2	30.0

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ARIHANT CAPITAL Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 4 billion as compared to Rs 3 billion in FY23, thereby witnessing an increase of 56.7%.
• Long-term debt stood at Rs 433 million as compared to Rs 0 million during FY23, a fall of 0.0%.
• Current assets rose 54% and stood at Rs 8 billion, while fixed assets fell 11% and stood at Rs 295 million in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 8 billion as against Rs 5 billion during FY23, thereby witnessing a growth of 50%.

ARIHANT CAPITAL Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	2,566	3,225	25.7
Current Liabilities	Rs m	2,643	4,140	56.7
Long-term Debt	Rs m	0	433	0.0
Total Liabilities	Rs m	5,220	7,804	49.5
Current assets	Rs m	4,887	7,509	53.7
Fixed Assets	Rs m	333	295	-11.4
Total Assets	Rs m	5,220	7,804	49.5

ARIHANT CAPITAL Cash Flow Statement Analysis

• ARIHANT CAPITAL's cash flow from operating activities (CFO) during FY24 stood at Rs -296 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs 62 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 274 million, an improvement of 186% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 39 million from the Rs -173 million net cash flows seen during FY23.

ARIHANT CAPITAL Cash Flow Statement 2023-24

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-23	Mar-24
Cash Flow from Operating Activities	Rs m	147	-296	-
Cash Flow from Investing Activities	Rs m	-2	62	-
Cash Flow from Financing Activities	Rs m	-318	274	-
Net Cash Flow	Rs m	-173	39	-

Current Valuations for ARIHANT CAPITAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.8, an improvement from the EPS of Rs 2.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 111.6, stands at 15.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.6 times, while the price to sales ratio stands at 4.9 times.
• The company's price to cash flow (P/CF) ratio stood at 8.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Sales per share (Unadj.)	Rs	13.2	22.6
TTM Earnings per share	Rs	2.8	6.8
Diluted earnings per share	Rs	2.8	6.8
Price to Cash Flow	x	12.9	8.5
TTM P/E ratio	x	13.9	15.5
Price / Book Value ratio	x	2.7	1.9
Market Cap	Rs m	6,872	6,163
Dividends per share (Unadj.)	Rs	0.4	0.5

Ratio Analysis for ARIHANT CAPITAL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY24, from 1.8x during FY23. 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 7.5x during FY24, from 4.6x during FY23. 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 21.9% during FY24, from 11.3% during FY24. 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 29.2% during FY24, from 19.6% during FY23. 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 10.9% during FY24, from 7.7% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Current ratio	x	1.8	1.8
Debtors’ Days	Days	4,588	1,496
Interest coverage	x	4.6	7.5
Debt to equity ratio	x	0.0	0.1
Return on assets	%	7.7	10.9
Return on equity	%	11.3	21.9
Return on capital employed	%	19.6	29.2

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

ARIHANT CAPITAL Share Price Performance

Over the last one year, ARIHANT CAPITAL share price has moved up from Rs 70.1 to Rs 111.6, registering a gain of Rs 41.5 or around 59.2%.

Overall, the S&P BSE SENSEX is up 27.5% over the year.

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