GAIL 2023-24 Annual Report Analysis

Mon, 5 Aug

GAIL 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.

GAIL Income Statement Analysis

• Operating income during the year fell 8.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 79.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 12.0% in FY24 as against 6.1% in FY23.
• Depreciation charges increased by 35.9% and finance costs increased by 94.0% YoY, respectively.
• Other income declined by 30.4% YoY.
• Net profit for the year grew by 77.0% YoY.
• Net profit margins during the year grew from 3.8% in FY23 to 7.4% in FY24.

GAIL Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	1,454,616	1,329,574	-8.6%
Other income	Rs m	14,496	10,088	-30.4%
Total Revenues	Rs m	1,469,112	1,339,662	-8.8%
Gross profit	Rs m	88,793	159,780	79.9%
Depreciation	Rs m	27,016	36,720	35.9%
Interest	Rs m	3,710	7,198	94.0%
Profit before tax	Rs m	72,564	125,950	73.6%
Tax	Rs m	16,605	26,922	62.1%
Profit after tax	Rs m	55,959	99,028	77.0%
Gross profit margin	%	6.1	12.0
Effective tax rate	%	22.9	21.4
Net profit margin	%	3.8	7.4

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GAIL Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 216 billion as compared to Rs 217 billion in FY23, thereby witnessing an decrease of -0.3%.
• Long-term debt stood at Rs 128 billion as compared to Rs 89 billion during FY23, a growth of 44.2%.
• Current assets fell 1% and stood at Rs 203 billion, while fixed assets rose 21% and stood at Rs 1,071 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 1,274 billion as against Rs 1,093 billion during FY23, thereby witnessing a growth of 17%.

GAIL Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	649,274	769,972	18.6
Current Liabilities	Rs m	217,110	216,405	-0.3
Long-term Debt	Rs m	88,797	128,060	44.2
Total Liabilities	Rs m	1,092,775	1,274,047	16.6
Current assets	Rs m	205,307	202,718	-1.3
Fixed Assets	Rs m	887,468	1,071,328	20.7
Total Assets	Rs m	1,092,775	1,274,047	16.6

GAIL Cash Flow Statement Analysis

• GAIL's cash flow from operating activities (CFO) during FY24 stood at Rs 126 billion, an improvement of 292.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -83 billion, an improvement of 8.3% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -35 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 9 billion from the Rs -13 billion net cash flows seen during FY23.

GAIL 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	32,047	125,857	292.7%
Cash Flow from Investing Activities	Rs m	-76,401	-82,734	-
Cash Flow from Financing Activities	Rs m	29,721	-34,574	-
Net Cash Flow	Rs m	-12,760	9,023	-

Current Valuations for GAIL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.1, an improvement from the EPS of Rs 8.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 224.2, stands at 15.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 1.1 times.
• The company's price to cash flow (P/CF) ratio stood at 7.2 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	221.2	202.2
TTM Earnings per share	Rs	8.5	15.1
Diluted earnings per share	Rs	8.5	15.1
Price to Cash Flow	x	8.3	7.2
TTM P/E ratio	x	16.9	15.5
Price / Book Value ratio	x	1.0	1.3
Market Cap	Rs m	653,017	983,964
Dividends per share (Unadj.)	Rs	5.0	5.5

Ratio Analysis for GAIL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.9x during FY24, from 0.9x 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 18.5x during FY24, from 20.6x 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 12.9% during FY24, from 8.6% 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 14.8% during FY24, from 10.3% 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 8.3% during FY24, from 5.5% 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	0.9	0.9
Debtors’ Days	Days	3	3
Interest coverage	x	20.6	18.5
Debt to equity ratio	x	0.1	0.2
Return on assets	%	5.5	8.3
Return on equity	%	8.6	12.9
Return on capital employed	%	10.3	14.8

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

GAIL Share Price Performance

Over the last one year, GAIL share price has moved up from Rs 115.2 to Rs 224.2, registering a gain of Rs 109.0 or around 94.6%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 31,013.0 (down 4.0%). Over the last one year it has moved up from 18,909.6 to 31,013.0, a gain of 12,103 points (up 64.0%).

Overall, the S&P BSE SENSEX is up 18.5% over the year.

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