PI INDUSTRIES 2018-19 Annual Report Analysis

Sun, 31 Mar

PI INDUSTRIES has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

PI INDUSTRIES Income Statement Analysis

• Operating income during the year rose 26.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 15.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 20.0% in FY19 as against 22.1% in FY18.
• Depreciation charges increased by 12.0% and finance costs decreased by 2.7% YoY, respectively.
• Other income grew by 13.6% YoY.
• Net profit for the year grew by 11.6% YoY.
• Net profit margins during the year declined from 16.4% in FY18 to 14.4% in FY19.

PI INDUSTRIES Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	22,455	28,409	26.5%
Other income	Rs m	602	684	13.6%
Total Revenues	Rs m	23,057	29,093	26.2%
Gross profit	Rs m	4,955	5,696	15.0%
Depreciation	Rs m	830	930	12.0%
Interest	Rs m	73	71	-2.7%
Profit before tax	Rs m	4,654	5,379	15.6%
Tax	Rs m	979	1,277	30.4%
Profit after tax	Rs m	3,675	4,102	11.6%
Gross profit margin	%	22.1	20.0
Effective tax rate	%	21.0	23.7
Net profit margin	%	16.4	14.4

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PI INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY19 down at Rs 15 billion as compared to Rs 18 billion in FY18, thereby witnessing an decrease of -15.1%.
• Long-term debt down at Rs 99 million as compared to Rs 463 million during FY18, a fall of 78.6%.
• Current assets fell 9% and stood at Rs 24 billion, while fixed assets rose 27% and stood at Rs 14 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 39 billion as against Rs 38 billion during FY18, thereby witnessing a growth of 2%.

PI INDUSTRIES Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	19,146	22,781	19.0
Current Liabilities	Rs m	18,078	15,341	-15.1
Long-term Debt	Rs m	463	99	-78.6
Total Liabilities	Rs m	37,938	38,633	1.8
Current assets	Rs m	26,559	24,135	-9.1
Fixed Assets	Rs m	11,379	14,498	27.4
Total Assets	Rs m	37,938	38,633	1.8

PI INDUSTRIES Cash Flow Statement Analysis

• PI INDUSTRIES's cash flow from operating activities (CFO) during FY19 stood at Rs 4 billion, an improvement of 22.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -3 billion, an improvement of 78.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -559 million from the Rs 328 million net cash flows seen during FY18.

PI INDUSTRIES Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	3,194	3,908	22.4%
Cash Flow from Investing Activities	Rs m	-1,805	-3,216	-
Cash Flow from Financing Activities	Rs m	-1,061	-1,251	-
Net Cash Flow	Rs m	328	-559	-

Current Valuations for PI INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 29.7, an improvement from the EPS of Rs 26.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,031.3, stands at 38.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.9 times, while the price to sales ratio stands at 5.0 times.
• The company's price to cash flow (P/CF) ratio stood at 23.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	162.8	205.8
TTM Earnings per share	Rs	26.6	29.7
Diluted earnings per share	Rs	24.2	27.0
Price to Cash Flow	x	29.9	23.7
TTM P/E ratio	x	36.8	38.4
Price / Book Value ratio	x	6.2	5.2
Market Cap	Rs m	117,852	119,383
Dividends per share (Unadj.)	Rs	4.0	4.0

Ratio Analysis for PI INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY19, from 1.5x during FY18. 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 76.8x during FY19, from 64.8x during FY18. 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 18.0% during FY19, from 19.2% during FY19. 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 23.8% during FY19, from 24.1% during FY18. 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 10.8% during FY19, from 9.9% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	1.5	1.6
Debtors’ Days	Days	86	85
Interest coverage	x	64.8	76.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.9	10.8
Return on equity	%	19.2	18.0
Return on capital employed	%	24.1	23.8

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

PI INDUSTRIES Share Price Performance

Over the last one year, PI INDUSTRIES share price has moved up from Rs 887.9 to Rs 1,031.3, registering a gain of Rs 143.4 or around 16.2%.

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Read: Latest Annual Report Analysis of PI INDUSTRIES