MTNL 2023-24 Annual Report Analysis

Tue, 10 Sep

MTNL 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.

MTNL Income Statement Analysis

• Operating income during the year fell 22.1% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a growth and stood at 72.2% in FY24 as against 46.5% in FY23.
• Depreciation charges decreased by 10.1% and finance costs increased by 14.0% YoY, respectively.
• Other income declined by 6.5% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 311.7% in FY23 to 453.3% in FY24.

MTNL Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	9,353	7,285	-22.1%
Other income	Rs m	6,131	5,730	-6.5%
Total Revenues	Rs m	15,483	13,015	-15.9%
Gross profit	Rs m	-4,350	-5,256	NA
Depreciation	Rs m	7,297	6,558	-10.1%
Interest	Rs m	23,640	26,938	14.0%
Profit before tax	Rs m	-29,156	-33,022	NA
Tax	Rs m	-5	0	NA
Profit after tax	Rs m	-29,151	-33,022	NA
Gross profit margin	%	-46.5	-72.2
Effective tax rate	%	0.0	0.0
Net profit margin	%	-311.7	-453.3

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

MTNL Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 98 billion as compared to Rs 123 billion in FY23, thereby witnessing an decrease of -21.0%.
• Long-term debt stood at Rs 240 billion as compared to Rs 195 billion during FY23, a growth of 23.1%.
• Current assets fell 8% and stood at Rs 53 billion, while fixed assets fell 8% and stood at Rs 54 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 107 billion as against Rs 116 billion during FY23, thereby witnessing a fall of 8%.

MTNL Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	-208,550	-236,628	NA
Current Liabilities	Rs m	123,377	97,515	-21.0
Long-term Debt	Rs m	195,073	240,058	23.1
Total Liabilities	Rs m	116,440	106,772	-8.3
Current assets	Rs m	57,936	53,084	-8.4
Fixed Assets	Rs m	58,503	53,648	-8.3
Total Assets	Rs m	116,440	106,772	-8.3

MTNL Cash Flow Statement Analysis

• MTNL's cash flow from operating activities (CFO) during FY24 stood at Rs 1 billion, an improvement of 107.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs 1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -857 million from the Rs 671 million net cash flows seen during FY23.

MTNL 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	639	1,326	107.7%
Cash Flow from Investing Activities	Rs m	-1,738	1,001	-
Cash Flow from Financing Activities	Rs m	1,771	-3,184	-
Net Cash Flow	Rs m	671	-857	-

Current Valuations for MTNL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -52.4, an decline from the EPS of Rs -46.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 56.2, stands at -1.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at -0.1 times, while the price to sales ratio stands at 4.9 times.
• The company's price to cash flow (P/CF) ratio stood at -0.8 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	14.8	11.6
TTM Earnings per share	Rs	-46.3	-52.4
Diluted earnings per share	Rs	-46.3	-52.4
Price to Cash Flow	x	-0.5	-0.8
TTM P/E ratio	x	-0.4	-1.1
Price / Book Value ratio	x	-0.1	-0.1
Market Cap	Rs m	14,837	22,179
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for MTNL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.5x during FY24, from 0.5x 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 -0.2x during FY24, from -0.2x 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 14.0% during FY24, from 14.0% 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 -177.4% during FY24, from 40.9% 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 -5.7% during FY24, from -4.7% 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	0.5	0.5
Debtors’ Days	Days	23	25
Interest coverage	x	-0.2	-0.2
Debt to equity ratio	x	-0.9	-1.0
Return on assets	%	-4.7	-5.7
Return on equity	%	14.0	14.0
Return on capital employed	%	40.9	-177.4

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

MTNL Share Price Performance

Over the last one year, MTNL share price has moved up from Rs 25.6 to Rs 56.2, registering a gain of Rs 30.6 or around 119.9%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 19,783.3 (up 1.6%). Over the last one year it has moved up from 14,559.5 to 19,783.3, a gain of 5,224 points (up 35.9%).

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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