BAJAJ AUTO 2020-21 Annual Report Analysis

Wed, 31 Mar

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

BAJAJ AUTO Income Statement Analysis

• Operating income during the year fell 7.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 3.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 17.7% in FY21 as against 17.0% in FY20.
• Depreciation charges increased by 5.3% and finance costs increased by 110.8% YoY, respectively.
• Other income declined by 15.9% YoY.
• Net profit for the year declined by 6.9% YoY.
• Net profit margins during the year grew from 16.3% in FY20 to 16.4% in FY21.

BAJAJ AUTO Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	299,187	277,411	-7.3%
Other income	Rs m	15,246	12,820	-15.9%
Total Revenues	Rs m	314,432	290,231	-7.7%
Gross profit	Rs m	50,956	49,191	-3.5%
Depreciation	Rs m	2,464	2,594	5.3%
Interest	Rs m	32	67	110.8%
Profit before tax	Rs m	63,706	59,351	-6.8%
Tax	Rs m	14,802	13,844	-6.5%
Profit after tax	Rs m	48,904	45,507	-6.9%
Gross profit margin	%	17.0	17.7
Effective tax rate	%	23.2	23.3
Net profit margin	%	16.3	16.4

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BAJAJ AUTO Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 56 billion as compared to Rs 43 billion in FY20, thereby witnessing an increase of 32.7%.
• Long-term debt down at Rs 1 billion as compared to Rs 1 billion during FY20, a fall of 3.3%.
• Current assets rose 114% and stood at Rs 142 billion, while fixed assets fell 2% and stood at Rs 194 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 336 billion as against Rs 265 billion during FY20, thereby witnessing a growth of 27%.

BAJAJ AUTO Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	216,621	272,734	25.9
Current Liabilities	Rs m	42,533	56,435	32.7
Long-term Debt	Rs m	1,256	1,215	-3.3
Total Liabilities	Rs m	265,100	336,017	26.8
Current assets	Rs m	66,160	141,877	114.4
Fixed Assets	Rs m	198,940	194,141	-2.4
Total Assets	Rs m	265,100	336,017	26.8

BAJAJ AUTO Cash Flow Statement Analysis

• BAJAJ AUTO's cash flow from operating activities (CFO) during FY21 stood at Rs 31 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -29 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -195 million, an improvement of 100% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 2 billion from the Rs -6 billion net cash flows seen during FY20.

BAJAJ AUTO Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	38,504	31,199	-19.0%
Cash Flow from Investing Activities	Rs m	15,561	-28,684	-
Cash Flow from Financing Activities	Rs m	-62,465	-195	-
Net Cash Flow	Rs m	-6,302	2,312	-

Current Valuations for BAJAJ AUTO

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 157.3, an decline from the EPS of Rs 169.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,671.7, stands at 23.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.9 times, while the price to sales ratio stands at 3.8 times.
• The company's price to cash flow (P/CF) ratio stood at 19.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	1,033.9	958.7
TTM Earnings per share	Rs	169.0	157.3
Diluted earnings per share	Rs	169.0	157.3
Price to Cash Flow	x	11.4	19.0
TTM P/E ratio	x	12.0	23.3
Price / Book Value ratio	x	3.4	3.4
Market Cap	Rs m	739,043	914,429
Dividends per share (Unadj.)	Rs	120.0	140.0

Ratio Analysis for BAJAJ AUTO

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.5x during FY21, from 1.6x during FY20. 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 deteriorated and stood at 892.2x during FY21, from 2,017.0x during FY20. 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 16.7% during FY21, from 22.6% during FY21. 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 declined and down at 21.7% during FY21, from 29.3% during FY20. 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 declined and down at 13.6% during FY21, from 18.5% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.6	2.5
Debtors’ Days	Days	2	4
Interest coverage	x	2,017.0	892.2
Debt to equity ratio	x	0.0	0.0
Return on assets	%	18.5	13.6
Return on equity	%	22.6	16.7
Return on capital employed	%	29.3	21.7

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

BAJAJ AUTO Share Price Performance

Over the last one year, BAJAJ AUTO share price has moved up from Rs 2,024.9 to Rs 3,671.7, registering a gain of Rs 1,646.8 or around 81.3%.

Meanwhile, the S&P BSE AUTO Index is trading at Rs 22,252.2 (down 0.0%). Over the last one year it has moved up from 10,746.2 to 22,252.2, a gain of 11,506 points (up 107.1%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of BAJAJ AUTO