NMDC 2023-24 Annual Report Analysis

Tue, 3 Sep

NMDC 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.

NMDC Income Statement Analysis

• Operating income during the year rose 20.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 3.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 32.9% in FY24 as against 41.3% in FY23.
• Depreciation charges increased by 4.3% and finance costs increased by 4.0% YoY, respectively.
• Other income grew by 78.4% YoY.
• Net profit for the year grew by 0.6% YoY.
• Net profit margins during the year declined from 31.3% in FY23 to 26.2% in FY24.

NMDC Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	176,669	213,079	20.6%
Other income	Rs m	7,682	13,709	78.4%
Total Revenues	Rs m	184,351	226,787	23.0%
Gross profit	Rs m	72,898	70,107	-3.8%
Depreciation	Rs m	3,362	3,507	4.3%
Interest	Rs m	752	782	4.0%
Profit before tax	Rs m	76,466	79,527	4.0%
Tax	Rs m	21,082	23,804	12.9%
Profit after tax	Rs m	55,384	55,722	0.6%
Gross profit margin	%	41.3	32.9
Effective tax rate	%	27.6	29.9
Net profit margin	%	31.3	26.2

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NMDC Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 153 billion as compared to Rs 142 billion in FY23, thereby witnessing an increase of 8.0%.
• Current assets rose 10% and stood at Rs 284 billion, while fixed assets rose 14% and stood at Rs 138 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 423 billion as against Rs 379 billion during FY23, thereby witnessing a growth of 12%.

NMDC Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	226,208	256,559	13.4
Current Liabilities	Rs m	141,644	152,928	8.0
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	379,133	422,831	11.5
Current assets	Rs m	258,107	284,355	10.2
Fixed Assets	Rs m	121,019	138,466	14.4
Total Assets	Rs m	379,133	422,831	11.5

NMDC Cash Flow Statement Analysis

• NMDC's cash flow from operating activities (CFO) during FY24 stood at Rs 74 billion, an improvement of 302.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -61 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -13 billion, an improvement of 37% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 164 million from the Rs -276 million net cash flows seen during FY23.

NMDC 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	18,376	73,948	302.4%
Cash Flow from Investing Activities	Rs m	2,023	-60,764	-
Cash Flow from Financing Activities	Rs m	-20,674	-13,020	-
Net Cash Flow	Rs m	-276	164	-

Current Valuations for NMDC

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.0, an improvement from the EPS of Rs 18.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 215.3, stands at 10.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.5 times, while the price to sales ratio stands at 3.0 times.
• The company's price to cash flow (P/CF) ratio stood at 8.8 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	60.3	72.7
TTM Earnings per share	Rs	18.9	19.0
Diluted earnings per share	Rs	18.9	19.0
Price to Cash Flow	x	5.6	8.8
TTM P/E ratio	x	5.9	10.7
Price / Book Value ratio	x	1.7	2.0
Market Cap	Rs m	394,166	522,234
Dividends per share (Unadj.)	Rs	6.6	7.3

Ratio Analysis for NMDC

• 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 102.6x during FY24, from 102.6x 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 21.7% during FY24, from 24.5% 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 declined and down at 31.3% during FY24, from 34.1% 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 13.4% during FY24, from 14.8% 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	9	6
Interest coverage	x	102.6	102.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	14.8	13.4
Return on equity	%	24.5	21.7
Return on capital employed	%	34.1	31.3

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

NMDC Share Price Performance

Over the last one year, NMDC share price has moved up from Rs 130.5 to Rs 215.3, registering a gain of Rs 84.8 or around 65.0%.

Overall, the S&P BSE SENSEX is up 26.8% over the year.

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