NCC 2023-24 Annual Report Analysis

Mon, 19 Aug

NCC 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.

NCC Income Statement Analysis

• Operating income during the year rose 34.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 19.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 8.4% in FY24 as against 9.4% in FY23.
• Depreciation charges increased by 4.6% and finance costs increased by 15.4% YoY, respectively.
• Other income declined by 14.7% YoY.
• Net profit for the year grew by 14.6% YoY.
• Net profit margins during the year declined from 4.2% in FY23 to 3.6% in FY24.

NCC Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	155,534	208,450	34.0%
Other income	Rs m	1,476	1,260	-14.7%
Total Revenues	Rs m	157,010	209,709	33.6%
Gross profit	Rs m	14,551	17,416	19.7%
Depreciation	Rs m	2,026	2,119	4.6%
Interest	Rs m	5,152	5,948	15.4%
Profit before tax	Rs m	8,849	10,609	19.9%
Tax	Rs m	2,386	3,205	34.3%
Profit after tax	Rs m	6,462	7,404	14.6%
Gross profit margin	%	9.4	8.4
Effective tax rate	%	27.0	30.2
Net profit margin	%	4.2	3.6

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NCC Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 111 billion as compared to Rs 99 billion in FY23, thereby witnessing an increase of 12.4%.
• Long-term debt down at Rs 697 million as compared to Rs 891 million during FY23, a fall of 21.8%.
• Current assets rose 12% and stood at Rs 149 billion, while fixed assets fell 3% and stood at Rs 32 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 180 billion as against Rs 165 billion during FY23, thereby witnessing a growth of 9%.

NCC Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	61,668	66,397	7.7
Current Liabilities	Rs m	98,908	111,156	12.4
Long-term Debt	Rs m	891	697	-21.8
Total Liabilities	Rs m	164,888	180,342	9.4
Current assets	Rs m	132,457	148,749	12.3
Fixed Assets	Rs m	32,431	31,593	-2.6
Total Assets	Rs m	164,888	180,342	9.4

NCC Cash Flow Statement Analysis

• NCC's cash flow from operating activities (CFO) during FY24 stood at Rs 14 billion, an improvement of 23.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -3 billion, an improvement of 66.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -8 billion, an improvement of 14% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 3 billion from the Rs 159 million net cash flows seen during FY23.

NCC 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	11,001	13,595	23.6%
Cash Flow from Investing Activities	Rs m	-1,916	-3,187	-
Cash Flow from Financing Activities	Rs m	-8,927	-7,712	-
Net Cash Flow	Rs m	159	2,695	1,600.6%

Current Valuations for NCC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.8, an improvement from the EPS of Rs 10.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 324.2, stands at 26.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 1.0 times.
• The company's price to cash flow (P/CF) ratio stood at 12.1 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	247.7	332.0
TTM Earnings per share	Rs	10.3	11.8
Diluted earnings per share	Rs	10.3	11.8
Price to Cash Flow	x	7.9	12.1
TTM P/E ratio	x	10.5	26.3
Price / Book Value ratio	x	0.8	1.7
Market Cap	Rs m	50,039	115,210
Dividends per share (Unadj.)	Rs	2.2	2.2

Ratio Analysis for NCC

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY24, from 1.3x 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 2.8x during FY24, from 2.7x 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 11.2% during FY24, from 10.5% 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 24.7% during FY24, from 22.4% 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 improved and stood at 7.4% during FY24, from 7.0% 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	1.3	1.3
Debtors’ Days	Days	7	5
Interest coverage	x	2.7	2.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.0	7.4
Return on equity	%	10.5	11.2
Return on capital employed	%	22.4	24.7

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

NCC Share Price Performance

Over the last one year, NCC share price has moved up from Rs 152.1 to Rs 324.2, registering a gain of Rs 172.1 or around 113.2%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 8,168.8 (down 0.3%). Over the last one year it has moved up from 4,243.5 to 8,168.8, a gain of 3,925 points (up 92.5%).

Overall, the S&P BSE SENSEX is up 22.9% over the year.

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