CESC 2023-24 Annual Report Analysis

Tue, 30 Jul

CESC 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.

CESC Income Statement Analysis

• Operating income during the year rose 7.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 13.4% YoY during the fiscal. Operating profit margins witnessed a fall and down at 26.3% in FY24 as against 24.9% in FY23.
• Depreciation charges increased by 38.6% and finance costs increased by 10.9% YoY, respectively.
• Other income declined by 18.7% YoY.
• Net profit for the year grew by 3.6% YoY.
• Net profit margins during the year declined from 9.8% in FY23 to 9.5% in FY24.

CESC Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	142,464	152,932	7.3%
Other income	Rs m	3,088	2,511	-18.7%
Total Revenues	Rs m	145,551	155,443	6.8%
Gross profit	Rs m	35,497	40,255	13.4%
Depreciation	Rs m	8,779	12,167	38.6%
Interest	Rs m	12,415	13,767	10.9%
Profit before tax	Rs m	17,391	16,831	-3.2%
Tax	Rs m	3,418	2,358	-31.0%
Profit after tax	Rs m	13,973	14,473	3.6%
Gross profit margin	%	24.9	26.3
Effective tax rate	%	19.7	14.0
Net profit margin	%	9.8	9.5

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CESC Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 69 billion as compared to Rs 94 billion in FY23, thereby witnessing an decrease of -26.0%.
• Long-term debt stood at Rs 109 billion as compared to Rs 96 billion during FY23, a growth of 13.5%.
• Current assets fell 0% and stood at Rs 141 billion, while fixed assets fell 2% and stood at Rs 230 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 372 billion as against Rs 377 billion during FY23, thereby witnessing a fall of 1%.

CESC Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	109,104	114,456	4.9
Current Liabilities	Rs m	93,842	69,450	-26.0
Long-term Debt	Rs m	95,689	108,561	13.5
Total Liabilities	Rs m	377,119	371,678	-1.4
Current assets	Rs m	141,468	141,319	-0.1
Fixed Assets	Rs m	235,651	230,359	-2.2
Total Assets	Rs m	377,119	371,678	-1.4

CESC Cash Flow Statement Analysis

• CESC's cash flow from operating activities (CFO) during FY24 stood at Rs 24 billion, an improvement of 18.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -6 billion, an improvement of 3.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -16 billion, an improvement of 33% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 1 billion from the Rs -10 billion net cash flows seen during FY23.

CESC 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	19,784	23,514	18.9%
Cash Flow from Investing Activities	Rs m	-5,447	-5,636	-
Cash Flow from Financing Activities	Rs m	-24,572	-16,416	-
Net Cash Flow	Rs m	-10,235	1,462	-

Current Valuations for CESC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.9, an improvement from the EPS of Rs 10.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 169.9, stands at 15.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 1.5 times.
• The company's price to cash flow (P/CF) ratio stood at 5.4 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	107.5	115.4
TTM Earnings per share	Rs	10.5	10.9
Diluted earnings per share	Rs	10.5	10.9
Price to Cash Flow	x	3.9	5.4
TTM P/E ratio	x	6.3	15.6
Price / Book Value ratio	x	0.9	1.3
Market Cap	Rs m	99,583	143,586
Dividends per share (Unadj.)	Rs	4.5	4.5

Ratio Analysis for CESC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.0x during FY24, from 1.5x 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 deteriorated and stood at 2.2x during FY24, from 2.4x 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 declined and down at 12.6% during FY24, from 12.8% 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 declined and down at 13.7% during FY24, from 14.6% 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 7.6% during FY24, from 7.0% 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	1.5	2.0
Debtors’ Days	Days	6	5
Interest coverage	x	2.4	2.2
Debt to equity ratio	x	0.9	0.9
Return on assets	%	7.0	7.6
Return on equity	%	12.8	12.6
Return on capital employed	%	14.6	13.7

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

CESC Share Price Performance

Over the last one year, CESC share price has moved up from Rs 75.3 to Rs 169.9, registering a gain of Rs 94.5 or around 125.4%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 8,246.8 (up 0.6%). Over the last one year it has moved up from 4,279.8 to 8,246.8, a gain of 3,967 points (up 92.7%).

Overall, the S&P BSE SENSEX is up 21.9% over the year.

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