BABA ARTS 2022-23 Annual Report Analysis

Mon, 20 Nov

BABA ARTS 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.

BABA ARTS Income Statement Analysis

• Operating income during the year fell 84.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 88.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 13.0% in FY23 as against 18.2% in FY22.
• Depreciation charges increased by 0.0% and finance costs increased by 50.0% YoY, respectively.
• Other income grew by 14.8% YoY.
• Net profit for the year declined by 65.6% YoY.
• Net profit margins during the year grew from 16.5% in FY22 to 36.7% in FY23.

BABA ARTS Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	180	28	-84.5%
Other income	Rs m	9	10	14.8%
Total Revenues	Rs m	189	38	-79.8%
Gross profit	Rs m	33	4	-88.9%
Depreciation	Rs m	1	1	0.0%
Interest	Rs m	0	0	50.0%
Profit before tax	Rs m	41	13	-67.6%
Tax	Rs m	11	3	-72.7%
Profit after tax	Rs m	30	10	-65.6%
Gross profit margin	%	18.2	13.0
Effective tax rate	%	27.6	23.3
Net profit margin	%	16.5	36.7

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BABA ARTS Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 6 million as compared to Rs 11 million in FY22, thereby witnessing an decrease of -48.7%.
• Current assets rose 4% and stood at Rs 213 million, while fixed assets fell 10% and stood at Rs 30 million in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 242 million as against Rs 238 million during FY22, thereby witnessing a growth of 2%.

BABA ARTS Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	224	234	4.5
Current Liabilities	Rs m	11	6	-48.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	238	242	2.1
Current assets	Rs m	204	213	4.0
Fixed Assets	Rs m	33	30	-10.2
Total Assets	Rs m	238	242	2.1

BABA ARTS Cash Flow Statement Analysis

• BABA ARTS's cash flow from operating activities (CFO) during FY23 stood at Rs -18 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -2 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 0 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -20 million from the Rs 33 million net cash flows seen during FY22.

BABA ARTS 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	2	-18	-
Cash Flow from Investing Activities	Rs m	31	-2	-
Cash Flow from Financing Activities	Rs m	0	0	-
Net Cash Flow	Rs m	33	-20	-

Current Valuations for BABA ARTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 0.2, an decline from the EPS of Rs 0.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 13.5, stands at 63.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.0 times, while the price to sales ratio stands at 25.4 times.
• The company's price to cash flow (P/CF) ratio stood at 95.2 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	3.4	0.5
TTM Earnings per share	Rs	0.6	0.2
Diluted earnings per share	Rs	0.6	0.2
Price to Cash Flow	x	34.3	95.2
TTM P/E ratio	x	35.0	63.5
Price / Book Value ratio	x	4.5	4.4
Market Cap	Rs m	999	1,029
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for BABA ARTS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 36.9x during FY23, from 18.2x 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 deteriorated and stood at 149.0x during FY23, from 686.2x 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 4.4% during FY23, from 13.3% 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 5.7% during FY23, from 18.4% 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 4.3% during FY23, from 12.5% 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	18.2	36.9
Debtors’ Days	Days	436	355
Interest coverage	x	686.2	149.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.5	4.3
Return on equity	%	13.3	4.4
Return on capital employed	%	18.4	5.7

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

BABA ARTS Share Price Performance

Over the last one year, BABA ARTS share price has moved down from Rs 17.7 to Rs 13.5, registering a loss of Rs 4.2 or around 23.5%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 14,697.4 (up 0.6%). Over the last one year it has moved up from 13,984.4 to 14,697.4, a gain of 713 points (up 5.1%).

Overall, the S&P BSE SENSEX is up 6.0% over the year.

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