BHARAT FORGE 2023-24 Annual Report Analysis

Thu, 18 Jul

BHARAT FORGE 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.

BHARAT FORGE Income Statement Analysis

• Operating income during the year rose 21.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 57.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.3% in FY24 as against 12.6% in FY23.
• Depreciation charges increased by 15.3% and finance costs increased by 66.0% YoY, respectively.
• Other income declined by 2.7% YoY.
• Net profit for the year grew by 79.0% YoY.
• Net profit margins during the year grew from 3.9% in FY23 to 5.8% in FY24.

BHARAT FORGE Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	129,103	156,821	21.5%
Other income	Rs m	2,383	2,318	-2.7%
Total Revenues	Rs m	131,485	159,139	21.0%
Gross profit	Rs m	16,229	25,509	57.2%
Depreciation	Rs m	7,356	8,482	15.3%
Interest	Rs m	2,986	4,956	66.0%
Profit before tax	Rs m	8,269	14,390	74.0%
Tax	Rs m	3,186	5,288	66.0%
Profit after tax	Rs m	5,084	9,102	79.0%
Gross profit margin	%	12.6	16.3
Effective tax rate	%	38.5	36.8
Net profit margin	%	3.9	5.8

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BHARAT FORGE Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 93 billion as compared to Rs 83 billion in FY23, thereby witnessing an increase of 12.1%.
• Long-term debt stood at Rs 19 billion as compared to Rs 18 billion during FY23, a growth of 6.2%.
• Current assets rose 11% and stood at Rs 100 billion, while fixed assets fell 1% and stood at Rs 92 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 192 billion as against Rs 182 billion during FY23, thereby witnessing a growth of 5%.

BHARAT FORGE Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	67,018	71,574	6.8
Current Liabilities	Rs m	82,769	92,801	12.1
Long-term Debt	Rs m	17,513	18,590	6.2
Total Liabilities	Rs m	182,347	191,840	5.2
Current assets	Rs m	90,020	100,155	11.3
Fixed Assets	Rs m	92,326	91,684	-0.7
Total Assets	Rs m	182,347	191,840	5.2

BHARAT FORGE Cash Flow Statement Analysis

• BHARAT FORGE's cash flow from operating activities (CFO) during FY24 stood at Rs 17 billion, an improvement of 28.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -7 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 8 billion from the Rs -497 million net cash flows seen during FY23.

BHARAT FORGE 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	12,945	16,644	28.6%
Cash Flow from Investing Activities	Rs m	-16,713	-6,667	-
Cash Flow from Financing Activities	Rs m	2,803	-2,027	-
Net Cash Flow	Rs m	-497	8,066	-

Current Valuations for BHARAT FORGE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.5, an improvement from the EPS of Rs 10.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,655.7, stands at 85.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 10.8 times, while the price to sales ratio stands at 4.9 times.
• The company's price to cash flow (P/CF) ratio stood at 27.5 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	277.3	336.8
TTM Earnings per share	Rs	10.9	19.5
Diluted earnings per share	Rs	10.9	19.5
Price to Cash Flow	x	28.8	27.5
TTM P/E ratio	x	66.2	85.2
Price / Book Value ratio	x	5.3	6.7
Market Cap	Rs m	353,149	482,815
Dividends per share (Unadj.)	Rs	7.0	9.0

Ratio Analysis for BHARAT FORGE

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.1x during FY24, from 1.1x 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 3.9x during FY24, from 3.8x 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 12.7% during FY24, from 7.6% 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 21.5% during FY24, from 13.3% 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 7.3% during FY24, from 4.4% 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	1.1	1.1
Debtors’ Days	Days	87	74
Interest coverage	x	3.8	3.9
Debt to equity ratio	x	0.3	0.3
Return on assets	%	4.4	7.3
Return on equity	%	7.6	12.7
Return on capital employed	%	13.3	21.5

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

BHARAT FORGE Share Price Performance

Over the last one year, BHARAT FORGE share price has moved up from Rs 870.2 to Rs 1,655.7, registering a gain of Rs 785.5 or around 90.3%.

Overall, the S&P BSE SENSEX is up 21.2% over the year.

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