NALCO 2023-24 Annual Report Analysis

Mon, 2 Sep

NALCO 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.

NALCO Income Statement Analysis

• Operating income during the year fell 7.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 34.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.8% in FY24 as against 16.4% in FY23.
• Depreciation charges increased by 4.7% and finance costs decreased by 4.2% YoY, respectively.
• Other income grew by 40.7% YoY.
• Net profit for the year grew by 38.6% YoY.
• Net profit margins during the year grew from 10.1% in FY23 to 15.1% in FY24.

NALCO Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	142,569	131,492	-7.8%
Other income	Rs m	2,476	3,484	40.7%
Total Revenues	Rs m	145,044	134,976	-6.9%
Gross profit	Rs m	23,313	31,305	34.3%
Depreciation	Rs m	7,158	7,497	4.7%
Interest	Rs m	180	172	-4.2%
Profit before tax	Rs m	18,452	27,121	47.0%
Tax	Rs m	4,105	7,236	76.3%
Profit after tax	Rs m	14,347	19,885	38.6%
Gross profit margin	%	16.4	23.8
Effective tax rate	%	22.2	26.7
Net profit margin	%	10.1	15.1

Don't Miss: Key Information for Long-term Investors

NALCO Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 32 billion as compared to Rs 29 billion in FY23, thereby witnessing an increase of 10.1%.
• Current assets rose 16% and stood at Rs 61 billion, while fixed assets rose 6% and stood at Rs 131 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 192 billion as against Rs 176 billion during FY23, thereby witnessing a growth of 9%.

NALCO Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	131,264	143,881	9.6
Current Liabilities	Rs m	28,857	31,777	10.1
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	176,266	192,350	9.1
Current assets	Rs m	53,005	61,299	15.6
Fixed Assets	Rs m	123,255	131,036	6.3
Total Assets	Rs m	176,266	192,350	9.1

NALCO Cash Flow Statement Analysis

• NALCO's cash flow from operating activities (CFO) during FY24 stood at Rs 27 billion, an improvement of 199.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -20 billion, an improvement of 498.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -7 billion, an improvement of 20% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -198 million from the Rs -3 billion net cash flows seen during FY23.

NALCO 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	9,082	27,193	199.4%
Cash Flow from Investing Activities	Rs m	-3,343	-20,005	-
Cash Flow from Financing Activities	Rs m	-9,235	-7,387	-
Net Cash Flow	Rs m	-3,495	-198	-

Current Valuations for NALCO

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.8, an improvement from the EPS of Rs 7.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 181.5, stands at 14.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.3 times, while the price to sales ratio stands at 2.5 times.
• The company's price to cash flow (P/CF) ratio stood at 8.3 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	77.6	71.6
TTM Earnings per share	Rs	7.8	10.8
Diluted earnings per share	Rs	7.8	10.8
Price to Cash Flow	x	6.7	8.3
TTM P/E ratio	x	9.3	14.4
Price / Book Value ratio	x	1.4	1.6
Market Cap	Rs m	183,158	228,064
Dividends per share (Unadj.)	Rs	4.5	3.0

Ratio Analysis for NALCO

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.9x during FY24, from 1.8x 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 improved and stood at 158.6x during FY24, from 103.7x 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 improved and stood at 13.8% during FY24, from 10.9% 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 improved and stood at 19.0% during FY24, from 14.2% 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 improved and stood at 10.4% during FY24, from 8.2% 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	1.8	1.9
Debtors’ Days	Days	0	0
Interest coverage	x	103.7	158.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	8.2	10.4
Return on equity	%	10.9	13.8
Return on capital employed	%	14.2	19.0

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

NALCO Share Price Performance

Over the last one year, NALCO share price has moved up from Rs 98.3 to Rs 181.5, registering a gain of Rs 83.1 or around 84.6%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 32,301.9 (down 0.5%). Over the last one year it has moved up from 22,542.1 to 32,301.9, a gain of 9,760 points (up 43.3%).

Overall, the S&P BSE SENSEX is up 26.9% over the year.

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