HIL 2023-24 Annual Report Analysis

Mon, 8 Jul

HIL 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.

HIL Income Statement Analysis

• Operating income during the year fell 3.0% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 28.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 4.7% in FY24 as against 6.4% in FY23.
• Depreciation charges increased by 8.3% and finance costs increased by 80.7% YoY, respectively.
• Other income grew by 24.5% YoY.
• Net profit for the year declined by 64.2% YoY.
• Net profit margins during the year declined from 2.8% in FY23 to 1.0% in FY24.

HIL Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	34,790	33,750	-3.0%
Other income	Rs m	253	316	24.5%
Total Revenues	Rs m	35,043	34,065	-2.8%
Gross profit	Rs m	2,217	1,594	-28.1%
Depreciation	Rs m	1,108	1,200	8.3%
Interest	Rs m	196	354	80.7%
Profit before tax	Rs m	1,167	355	-69.5%
Tax	Rs m	196	8	-96.1%
Profit after tax	Rs m	971	348	-64.2%
Gross profit margin	%	6.4	4.7
Effective tax rate	%	16.8	2.1
Net profit margin	%	2.8	1.0

Dear Reader: If You Invest in Midcap Stocks, this is for You

HIL Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 9 billion as compared to Rs 8 billion in FY23, thereby witnessing an increase of 12.0%.
• Long-term debt stood at Rs 3 billion as compared to Rs 2 billion during FY23, a growth of 56.9%.
• Current assets rose 16% and stood at Rs 12 billion, while fixed assets rose 16% and stood at Rs 15 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 27 billion as against Rs 24 billion during FY23, thereby witnessing a growth of 16%.

HIL Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	12,435	12,494	0.5
Current Liabilities	Rs m	7,694	8,619	12.0
Long-term Debt	Rs m	2,038	3,197	56.9
Total Liabilities	Rs m	23,644	27,432	16.0
Current assets	Rs m	10,455	12,160	16.3
Fixed Assets	Rs m	13,189	15,273	15.8
Total Assets	Rs m	23,644	27,432	16.0

HIL Cash Flow Statement Analysis

• HIL's cash flow from operating activities (CFO) during FY24 stood at Rs 2 billion, an improvement of 31.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 617 million, an improvement of 47% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 726 million from the Rs -2 million net cash flows seen during FY23.

HIL 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	1,320	1,733	31.3%
Cash Flow from Investing Activities	Rs m	-1,777	-1,628	-
Cash Flow from Financing Activities	Rs m	421	617	46.7%
Net Cash Flow	Rs m	-2	726	-

Current Valuations for HIL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 46.1, an decline from the EPS of Rs 128.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2,880.7, stands at 61.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.7 times, while the price to sales ratio stands at 0.6 times.
• The company's price to cash flow (P/CF) ratio stood at 13.9 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	4,614.0	4,476.1
TTM Earnings per share	Rs	128.8	46.1
Diluted earnings per share	Rs	128.8	46.1
Price to Cash Flow	x	8.7	13.9
TTM P/E ratio	x	18.4	61.4
Price / Book Value ratio	x	2.0	1.7
Market Cap	Rs m	24,461	21,488
Dividends per share (Unadj.)	Rs	45.0	37.5

Ratio Analysis for HIL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.4x during FY24, from 1.4x 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 2.0x during FY24, from 7.0x 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 2.8% during FY24, from 7.8% 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 4.5% during FY24, from 9.4% 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 2.6% during FY24, from 4.9% 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	1.4	1.4
Debtors’ Days	Days	135	166
Interest coverage	x	7.0	2.0
Debt to equity ratio	x	0.2	0.3
Return on assets	%	4.9	2.6
Return on equity	%	7.8	2.8
Return on capital employed	%	9.4	4.5

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

HIL Share Price Performance

Over the last one year, HIL share price has moved down from Rs 3,021.5 to Rs 2,880.7, registering a loss of Rs 140.8 or around 4.7%.

Overall, the S&P BSE SENSEX is up 22.1% over the year.

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