MORARJEE TEXTILES 2021-22 Annual Report Analysis

Tue, 20 Sep

MORARJEE TEXTILES has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

MORARJEE TEXTILES Income Statement Analysis

• Operating income during the year rose 40.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 126.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 2.2% in FY22 as against 1.4% in FY21.
• Depreciation charges decreased by 1.7% and finance costs increased by 32.8% YoY, respectively.
• Other income grew by 1.3% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 31.8% in FY21 to 32.4% in FY22.

MORARJEE TEXTILES Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	1,939	2,723	40.5%
Other income	Rs m	12	12	1.3%
Total Revenues	Rs m	1,950	2,735	40.2%
Gross profit	Rs m	27	61	126.2%
Depreciation	Rs m	233	229	-1.7%
Interest	Rs m	545	725	32.8%
Profit before tax	Rs m	-740	-881	NA
Tax	Rs m	-124	0	NA
Profit after tax	Rs m	-616	-881	NA
Gross profit margin	%	1.4	2.2
Effective tax rate	%	16.7	0.0
Net profit margin	%	-31.8	-32.4

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MORARJEE TEXTILES Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 5 billion as compared to Rs 4 billion in FY21, thereby witnessing an increase of 33.0%.
• Long-term debt down at Rs 2 billion as compared to Rs 2 billion during FY21, a fall of 31.9%.
• Current assets fell 4% and stood at Rs 2 billion, while fixed assets fell 5% and stood at Rs 4 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 6 billion as against Rs 6 billion during FY21, thereby witnessing a fall of 5%.

MORARJEE TEXTILES Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	-51	-933	NA
Current Liabilities	Rs m	4,093	5,443	33.0
Long-term Debt	Rs m	2,288	1,558	-31.9
Total Liabilities	Rs m	6,262	5,966	-4.7
Current assets	Rs m	1,919	1,845	-3.9
Fixed Assets	Rs m	4,344	4,121	-5.1
Total Assets	Rs m	6,262	5,966	-4.7

MORARJEE TEXTILES Cash Flow Statement Analysis

• MORARJEE TEXTILES's cash flow from operating activities (CFO) during FY22 stood at Rs 178 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -1 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -59 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 119 million from the Rs 46 million net cash flows seen during FY21.

MORARJEE TEXTILES Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	-982	178	-
Cash Flow from Investing Activities	Rs m	-4	-1	-
Cash Flow from Financing Activities	Rs m	1,032	-59	-
Net Cash Flow	Rs m	46	119	156.6%

Current Valuations for MORARJEE TEXTILES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -24.3, an decline from the EPS of Rs -17.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 21.0, stands at -0.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at -0.8 times, while the price to sales ratio stands at 0.3 times.
• The company's price to cash flow (P/CF) ratio stood at -1.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	53.4	75.0
TTM Earnings per share	Rs	-17.0	-24.3
Diluted earnings per share	Rs	-17.0	-24.3
Price to Cash Flow	x	-1.3	-1.3
TTM P/E ratio	x	-0.8	-0.7
Price / Book Value ratio	x	-9.5	-0.9
Market Cap	Rs m	480	859
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for MORARJEE TEXTILES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.3x during FY22, from 0.5x during FY21. 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 -0.2x during FY22, from -0.4x during FY21. 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 94.4% during FY22, from 1,216.7% during FY22. 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 -25.1% during FY22, from -8.7% during FY21. 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 FY22, from -1.1% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	0.5	0.3
Debtors’ Days	Days	667	281
Interest coverage	x	-0.4	-0.2
Debt to equity ratio	x	-45.2	-1.7
Return on assets	%	-1.1	-2.6
Return on equity	%	1,216.7	94.4
Return on capital employed	%	-8.7	-25.1

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

MORARJEE TEXTILES Share Price Performance

Over the last one year, MORARJEE TEXTILES share price has moved up from Rs 15.5 to Rs 21.0, registering a gain of Rs 5.5 or around 35.2%.

Overall, the S&P BSE SENSEX is up 0.9% over the year.

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