DEEP POLYMERS 2022-23 Annual Report Analysis

Wed, 25 Oct

DEEP POLYMERS has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

DEEP POLYMERS Income Statement Analysis

• Operating income during the year fell 12.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 15.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 12.9% in FY23 as against 13.4% in FY22.
• Depreciation charges decreased by 4.2% and finance costs decreased by 15.7% YoY, respectively.
• Other income grew by 21.2% YoY.
• Net profit for the year declined by 16.4% YoY.
• Net profit margins during the year declined from 8.1% in FY22 to 7.7% in FY23.

DEEP POLYMERS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	1,377	1,205	-12.5%
Other income	Rs m	16	20	21.2%
Total Revenues	Rs m	1,393	1,224	-12.1%
Gross profit	Rs m	184	156	-15.3%
Depreciation	Rs m	21	20	-4.2%
Interest	Rs m	26	22	-15.7%
Profit before tax	Rs m	153	133	-12.9%
Tax	Rs m	42	40	-3.6%
Profit after tax	Rs m	111	93	-16.4%
Gross profit margin	%	13.4	12.9
Effective tax rate	%	27.4	30.3
Net profit margin	%	8.1	7.7

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DEEP POLYMERS Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 144 million as compared to Rs 103 million in FY22, thereby witnessing an increase of 39.3%.
• Long-term debt stood at Rs 511 million as compared to Rs 472 million during FY22, a growth of 8.2%.
• Current assets rose 3% and stood at Rs 838 million, while fixed assets rose 44% and stood at Rs 490 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 1 billion as against Rs 1 billion during FY22, thereby witnessing a growth of 15%.

DEEP POLYMERS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	578	673	16.3
Current Liabilities	Rs m	103	144	39.3
Long-term Debt	Rs m	472	511	8.2
Total Liabilities	Rs m	1,154	1,328	15.1
Current assets	Rs m	813	838	3.0
Fixed Assets	Rs m	341	490	43.7
Total Assets	Rs m	1,154	1,328	15.1

DEEP POLYMERS Cash Flow Statement Analysis

• DEEP POLYMERS's cash flow from operating activities (CFO) during FY23 stood at Rs 129 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -136 million, an improvement of 15.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -5 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -12 million from the Rs 17 million net cash flows seen during FY22.

DEEP POLYMERS Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	-25	129	-
Cash Flow from Investing Activities	Rs m	-118	-136	-
Cash Flow from Financing Activities	Rs m	160	-5	-
Net Cash Flow	Rs m	17	-12	-

Current Valuations for DEEP POLYMERS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.0, an decline from the EPS of Rs 4.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 89.9, stands at 22.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 1.7 times.
• The company's price to cash flow (P/CF) ratio stood at 33.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	59.8	52.3
TTM Earnings per share	Rs	4.8	4.0
Diluted earnings per share	Rs	4.8	4.0
Price to Cash Flow	x	30.1	33.7
TTM P/E ratio	x	41.4	22.7
Price / Book Value ratio	x	17.2	5.7
Market Cap	Rs m	9,956	3,812
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for DEEP POLYMERS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 5.8x during FY23, from 7.9x during FY22. 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 7.1x during FY23, from 6.9x during FY22. 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 13.8% during FY23, from 19.2% during FY23. 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 13.1% during FY23, from 17.1% during FY22. 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 8.7% during FY23, from 11.9% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	7.9	5.8
Debtors’ Days	Days	119,928,677	94,510,629
Interest coverage	x	6.9	7.1
Debt to equity ratio	x	0.8	0.8
Return on assets	%	11.9	8.7
Return on equity	%	19.2	13.8
Return on capital employed	%	17.1	13.1

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

DEEP POLYMERS Share Price Performance

Over the last one year, DEEP POLYMERS share price has moved down from Rs 147.8 to Rs 89.9, registering a loss of Rs 57.9 or around 39.2%.

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

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