ETHOS 2023-24 Annual Report Analysis

Tue, 10 Sep

ETHOS 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.

ETHOS Income Statement Analysis

• Operating income during the year rose 26.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 31.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 15.9% in FY24 as against 15.3% in FY23.
• Depreciation charges increased by 40.6% and finance costs increased by 9.2% YoY, respectively.
• Other income grew by 59.0% YoY.
• Net profit for the year grew by 38.1% YoY.
• Net profit margins during the year grew from 7.6% in FY23 to 8.3% in FY24.

ETHOS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	7,885	9,990	26.7%
Other income	Rs m	149	236	59.0%
Total Revenues	Rs m	8,034	10,226	27.3%
Gross profit	Rs m	1,206	1,584	31.3%
Depreciation	Rs m	346	487	40.6%
Interest	Rs m	202	220	9.2%
Profit before tax	Rs m	807	1,113	38.0%
Tax	Rs m	204	280	37.5%
Profit after tax	Rs m	603	833	38.1%
Gross profit margin	%	15.3	15.9
Effective tax rate	%	25.3	25.2
Net profit margin	%	7.6	8.3

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ETHOS Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 2 billion as compared to Rs 1 billion in FY23, thereby witnessing an increase of 14.2%.
• Long-term debt down at Rs 21 million as compared to Rs 71 million during FY23, a fall of 71.1%.
• Current assets rose 35% and stood at Rs 9 billion, while fixed assets rose 28% and stood at Rs 3 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 12 billion as against Rs 9 billion during FY23, thereby witnessing a growth of 33%.

ETHOS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	6,315	8,840	40.0
Current Liabilities	Rs m	1,495	1,708	14.2
Long-term Debt	Rs m	71	21	-71.1
Total Liabilities	Rs m	8,711	11,616	33.4
Current assets	Rs m	6,385	8,641	35.3
Fixed Assets	Rs m	2,326	2,975	27.9
Total Assets	Rs m	8,711	11,616	33.4

ETHOS Cash Flow Statement Analysis

• ETHOS's cash flow from operating activities (CFO) during FY24 stood at Rs 308 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 1 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 327 million from the Rs -98 million net cash flows seen during FY23.

ETHOS 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	-21	308	-
Cash Flow from Investing Activities	Rs m	-2,562	-1,228	-
Cash Flow from Financing Activities	Rs m	2,486	1,247	-49.8%
Net Cash Flow	Rs m	-98	327	-

Current Valuations for ETHOS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 34.0, an improvement from the EPS of Rs 25.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,366.0, stands at 94.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.3 times, while the price to sales ratio stands at 8.2 times.
• The company's price to cash flow (P/CF) ratio stood at 36.9 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	337.7	408.1
TTM Earnings per share	Rs	25.8	34.0
Diluted earnings per share	Rs	24.6	34.0
Price to Cash Flow	x	24.8	36.9
TTM P/E ratio	x	39.4	94.0
Price / Book Value ratio	x	3.4	5.5
Market Cap	Rs m	21,679	48,658
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for ETHOS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 5.1x during FY24, from 4.3x 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 6.1x during FY24, from 5.0x 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 9.4% during FY24, from 9.5% 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 15.0% during FY24, from 15.8% 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 declined and down at 9.1% during FY24, from 9.2% 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	4.3	5.1
Debtors’ Days	Days	29	57
Interest coverage	x	5.0	6.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.2	9.1
Return on equity	%	9.5	9.4
Return on capital employed	%	15.8	15.0

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

ETHOS Share Price Performance

Over the last one year, ETHOS share price has moved up from Rs 1,641.8 to Rs 3,366.0, registering a gain of Rs 1,724.3 or around 105.0%.

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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