KANSAI NEROLAC 2023-24 Annual Report Analysis

Mon, 10 Jun

KANSAI NEROLAC 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.

KANSAI NEROLAC Income Statement Analysis

• Operating income during the year rose 3.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 106.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.6% in FY24 as against 10.8% in FY23.
• Depreciation charges increased by 5.8% and finance costs increased by 0.7% YoY, respectively.
• Other income grew by 253.7% YoY.
• Net profit for the year grew by 151.0% YoY.
• Net profit margins during the year grew from 6.2% in FY23 to 15.1% in FY24.

KANSAI NEROLAC Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	75,427	78,014	3.4%
Other income	Rs m	260	919	253.7%
Total Revenues	Rs m	75,687	78,933	4.3%
Gross profit	Rs m	8,180	16,890	106.5%
Depreciation	Rs m	1,801	1,905	5.8%
Interest	Rs m	290	292	0.7%
Profit before tax	Rs m	6,349	15,612	145.9%
Tax	Rs m	1,664	3,854	131.6%
Profit after tax	Rs m	4,685	11,759	151.0%
Gross profit margin	%	10.8	21.6
Effective tax rate	%	26.2	24.7
Net profit margin	%	6.2	15.1

Don't Miss: Key Information for Long-term Investors

KANSAI NEROLAC Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 15 billion as compared to Rs 15 billion in FY23, thereby witnessing an increase of 0.9%.
• Long-term debt stood at Rs 150 million as compared to Rs 47 million during FY23, a growth of 219.8%.
• Current assets rose 25% and stood at Rs 47 billion, while fixed assets rose 6% and stood at Rs 27 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 74 billion as against Rs 63 billion during FY23, thereby witnessing a growth of 17%.

KANSAI NEROLAC Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	45,300	55,667	22.9
Current Liabilities	Rs m	15,067	15,206	0.9
Long-term Debt	Rs m	47	150	219.8
Total Liabilities	Rs m	63,064	74,097	17.5
Current assets	Rs m	38,031	47,490	24.9
Fixed Assets	Rs m	25,033	26,606	6.3
Total Assets	Rs m	63,064	74,097	17.5

KANSAI NEROLAC Cash Flow Statement Analysis

• KANSAI NEROLAC's cash flow from operating activities (CFO) during FY24 stood at Rs 9 billion, an improvement of 121.2% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -6 billion, an improvement of 159.9% 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 644 million from the Rs 487 million net cash flows seen during FY23.

KANSAI NEROLAC 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	4,083	9,030	121.2%
Cash Flow from Investing Activities	Rs m	-2,269	-5,898	-
Cash Flow from Financing Activities	Rs m	-1,326	-2,488	-
Net Cash Flow	Rs m	487	644	32.2%

Current Valuations for KANSAI NEROLAC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 14.5, an improvement from the EPS of Rs 8.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 282.6, stands at 19.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.1 times, while the price to sales ratio stands at 2.9 times.
• The company's price to cash flow (P/CF) ratio stood at 17.8 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	140.0	96.5
TTM Earnings per share	Rs	8.7	14.5
Diluted earnings per share	Rs	5.8	14.5
Price to Cash Flow	x	32.1	17.8
TTM P/E ratio	x	44.4	19.4
Price / Book Value ratio	x	5.3	4.4
Market Cap	Rs m	240,884	243,551
Dividends per share (Unadj.)	Rs	2.7	3.8

Ratio Analysis for KANSAI NEROLAC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 3.1x during FY24, from 2.5x 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 improved and stood at 54.4x during FY24, from 22.9x 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 21.1% during FY24, from 10.3% 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 28.5% 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 16.3% during FY24, from 7.9% 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	2.5	3.1
Debtors’ Days	Days	6	6
Interest coverage	x	22.9	54.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.9	16.3
Return on equity	%	10.3	21.1
Return on capital employed	%	14.6	28.5

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

KANSAI NEROLAC Share Price Performance

Over the last one year, KANSAI NEROLAC share price has moved down from Rs 289.1 to Rs 282.6, registering a loss of Rs 6.5 or around 2.3%.

Overall, the S&P BSE SENSEX is up 22.2% over the year.

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