PRECISION WIRES 2023-24 Annual Report Analysis

Tue, 27 Aug

PRECISION WIRES 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.

PRECISION WIRES Income Statement Analysis

• Operating income during the year rose 5.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 25.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 5.3% in FY24 as against 4.5% in FY23.
• Depreciation charges increased by 22.8% and finance costs increased by 12.8% YoY, respectively.
• Other income declined by 11.8% YoY.
• Net profit for the year grew by 22.5% YoY.
• Net profit margins during the year grew from 2.5% in FY23 to 2.9% in FY24.

PRECISION WIRES Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	23,886	25,095	5.1%
Other income	Rs m	219	193	-11.8%
Total Revenues	Rs m	24,105	25,288	4.9%
Gross profit	Rs m	1,065	1,340	25.9%
Depreciation	Rs m	142	174	22.8%
Interest	Rs m	329	371	12.8%
Profit before tax	Rs m	813	988	21.6%
Tax	Rs m	218	260	19.1%
Profit after tax	Rs m	595	729	22.5%
Gross profit margin	%	4.5	5.3
Effective tax rate	%	26.8	26.3
Net profit margin	%	2.5	2.9

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PRECISION WIRES Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 5 billion as compared to Rs 5 billion in FY23, thereby witnessing an increase of 15.6%.
• Long-term debt stood at Rs 194 million as compared to Rs 132 million during FY23, a growth of 47.2%.
• Current assets rose 13% and stood at Rs 9 billion, while fixed assets rose 20% and stood at Rs 2 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 11 billion as against Rs 9 billion during FY23, thereby witnessing a growth of 14%.

PRECISION WIRES Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	4,503	5,064	12.5
Current Liabilities	Rs m	4,580	5,293	15.6
Long-term Debt	Rs m	132	194	47.2
Total Liabilities	Rs m	9,282	10,621	14.4
Current assets	Rs m	7,961	9,031	13.4
Fixed Assets	Rs m	1,321	1,590	20.3
Total Assets	Rs m	9,282	10,621	14.4

PRECISION WIRES Cash Flow Statement Analysis

• PRECISION WIRES's cash flow from operating activities (CFO) during FY24 stood at Rs 597 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -936 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 284 million, an improvement of 153% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -55 million from the Rs 332 million net cash flows seen during FY23.

PRECISION WIRES 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	767	597	-22.2%
Cash Flow from Investing Activities	Rs m	100	-936	-
Cash Flow from Financing Activities	Rs m	-534	284	-
Net Cash Flow	Rs m	332	-55	-

Current Valuations for PRECISION WIRES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 4.1, an improvement from the EPS of Rs 3.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 190.1, stands at 43.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 6.7 times, while the price to sales ratio stands at 1.4 times.
• The company's price to cash flow (P/CF) ratio stood at 21.6 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	133.7	140.5
TTM Earnings per share	Rs	3.3	4.1
Diluted earnings per share	Rs	3.3	4.1
Price to Cash Flow	x	15.6	21.6
TTM P/E ratio	x	19.3	43.2
Price / Book Value ratio	x	3.5	3.9
Market Cap	Rs m	15,834	19,514
Dividends per share (Unadj.)	Rs	1.0	1.1

Ratio Analysis for PRECISION WIRES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.7x during FY24, from 1.7x 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 3.7x during FY24, from 3.5x 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 14.4% during FY24, from 13.2% 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 25.9% during FY24, from 24.6% 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 10.0% 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	1.7	1.7
Debtors’ Days	Days	702	613
Interest coverage	x	3.5	3.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	10.0	10.4
Return on equity	%	13.2	14.4
Return on capital employed	%	24.6	25.9

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

PRECISION WIRES Share Price Performance

Over the last one year, PRECISION WIRES share price has moved up from Rs 89.7 to Rs 190.1, registering a gain of Rs 100.3 or around 111.8%.

Overall, the S&P BSE SENSEX is up 24.9% over the year.

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