HINDUSTAN ZINC 2023-24 Annual Report Analysis

Fri, 21 Jun

HINDUSTAN ZINC 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.

HINDUSTAN ZINC Income Statement Analysis

• Operating income during the year fell 15.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 22.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 47.2% in FY24 as against 51.3% in FY23.
• Depreciation charges increased by 6.2% and finance costs increased by 186.8% YoY, respectively.
• Other income declined by 20.0% YoY.
• Net profit for the year declined by 25.9% YoY.
• Net profit margins during the year declined from 30.8% in FY23 to 26.9% in FY24.

HINDUSTAN ZINC Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	340,980	289,340	-15.1%
Other income	Rs m	13,790	11,030	-20.0%
Total Revenues	Rs m	354,770	300,370	-15.3%
Gross profit	Rs m	175,060	136,610	-22.0%
Depreciation	Rs m	32,640	34,660	6.2%
Interest	Rs m	3,330	9,550	186.8%
Profit before tax	Rs m	152,880	103,430	-32.3%
Tax	Rs m	47,770	25,560	-46.5%
Profit after tax	Rs m	105,110	77,870	-25.9%
Gross profit margin	%	51.3	47.2
Effective tax rate	%	31.2	24.7
Net profit margin	%	30.8	26.9

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HINDUSTAN ZINC Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 108 billion as compared to Rs 175 billion in FY23, thereby witnessing an decrease of -38.0%.
• Long-term debt stood at Rs 42 billion as compared to Rs 15 billion during FY23, a growth of 183.1%.
• Current assets fell 14% and stood at Rs 127 billion, while fixed assets rose 3% and stood at Rs 212 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 339 billion as against Rs 355 billion during FY23, thereby witnessing a fall of 4%.

HINDUSTAN ZINC Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	129,320	152,330	17.8
Current Liabilities	Rs m	174,530	108,180	-38.0
Long-term Debt	Rs m	15,000	42,460	183.1
Total Liabilities	Rs m	354,670	339,040	-4.4
Current assets	Rs m	148,040	126,930	-14.3
Fixed Assets	Rs m	206,630	212,110	2.7
Total Assets	Rs m	354,670	339,040	-4.4

HINDUSTAN ZINC Cash Flow Statement Analysis

• HINDUSTAN ZINC's cash flow from operating activities (CFO) during FY24 stood at Rs 133 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -34 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -99 billion, an improvement of 57% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -80 million from the Rs -15 billion net cash flows seen during FY23.

HINDUSTAN ZINC 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	151,290	133,430	-11.8%
Cash Flow from Investing Activities	Rs m	65,620	-34,050	-
Cash Flow from Financing Activities	Rs m	-232,240	-99,460	-
Net Cash Flow	Rs m	-15,330	-80	-

Current Valuations for HINDUSTAN ZINC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 18.4, an decline from the EPS of Rs 24.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 647.7, stands at 35.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 18.0 times, while the price to sales ratio stands at 9.5 times.
• The company's price to cash flow (P/CF) ratio stood at 11.8 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	80.7	68.5
TTM Earnings per share	Rs	24.9	18.4
Diluted earnings per share	Rs	24.9	18.4
Price to Cash Flow	x	9.0	11.8
TTM P/E ratio	x	11.8	35.3
Price / Book Value ratio	x	10.2	8.7
Market Cap	Rs m	1,321,257	1,328,863
Dividends per share (Unadj.)	Rs	75.5	13.0

Ratio Analysis for HINDUSTAN ZINC

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.2x during FY24, from 0.8x 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 11.8x during FY24, from 46.9x 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 declined and down at 51.1% during FY24, from 81.3% 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 declined and down at 58.0% during FY24, from 108.2% 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 25.8% during FY24, from 30.6% 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	0.8	1.2
Debtors’ Days	Days	0	0
Interest coverage	x	46.9	11.8
Debt to equity ratio	x	0.1	0.3
Return on assets	%	30.6	25.8
Return on equity	%	81.3	51.1
Return on capital employed	%	108.2	58.0

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

HINDUSTAN ZINC Share Price Performance

Over the last one year, HINDUSTAN ZINC share price has moved up from Rs 308.2 to Rs 647.7, registering a gain of Rs 339.5 or around 110.1%.

Overall, the S&P BSE SENSEX is up 22.7% over the year.

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