RALLIS 2020-21 Annual Report Analysis

Wed, 31 Mar

RALLIS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

RALLIS Income Statement Analysis

• Operating income during the year rose 7.9% on a year-on-year (YoY) basis.
• The company's operating profit increased by 21.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.7% in FY21 as against 12.2% in FY20.
• Depreciation charges increased by 4.2% and finance costs decreased by 30.7% YoY, respectively.
• Other income grew by 17.8% YoY.
• Net profit for the year grew by 24.4% YoY.
• Net profit margins during the year grew from 8.2% in FY20 to 9.4% in FY21.

RALLIS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	22,518	24,294	7.9%
Other income	Rs m	343	405	17.8%
Total Revenues	Rs m	22,862	24,699	8.0%
Gross profit	Rs m	2,744	3,339	21.7%
Depreciation	Rs m	615	641	4.2%
Interest	Rs m	98	68	-30.7%
Profit before tax	Rs m	2,375	3,035	27.8%
Tax	Rs m	538	749	39.3%
Profit after tax	Rs m	1,837	2,286	24.4%
Gross profit margin	%	12.2	13.7
Effective tax rate	%	22.7	24.7
Net profit margin	%	8.2	9.4

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RALLIS Balance Sheet Analysis

• The company's current liabilities during FY21 down at Rs 9 billion as compared to Rs 10 billion in FY20, thereby witnessing an decrease of -4.5%.
• Long-term debt down at Rs 78 million as compared to Rs 124 million during FY20, a fall of 37.0%.
• Current assets rose 3% and stood at Rs 17 billion, while fixed assets rose 12% and stood at Rs 9 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 26 billion as against Rs 24 billion during FY20, thereby witnessing a growth of 6%.

RALLIS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	14,095	15,908	12.9
Current Liabilities	Rs m	9,574	9,145	-4.5
Long-term Debt	Rs m	124	78	-37.0
Total Liabilities	Rs m	24,485	25,886	5.7
Current assets	Rs m	16,142	16,554	2.6
Fixed Assets	Rs m	8,342	9,332	11.9
Total Assets	Rs m	24,485	25,886	5.7

RALLIS Cash Flow Statement Analysis

• RALLIS's cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -674 million, an improvement of 9% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs -122 million from the Rs 165 million net cash flows seen during FY20.

RALLIS Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	3,368	2,168	-35.6%
Cash Flow from Investing Activities	Rs m	-2,459	-1,615	-
Cash Flow from Financing Activities	Rs m	-744	-674	-
Net Cash Flow	Rs m	165	-122	-

Current Valuations for RALLIS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.8, an improvement from the EPS of Rs 9.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 252.9, stands at 21.5 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 2.0 times.
• The company's price to cash flow (P/CF) ratio stood at 16.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	115.8	124.9
TTM Earnings per share	Rs	9.4	11.8
Diluted earnings per share	Rs	9.4	11.8
Price to Cash Flow	x	13.9	16.8
TTM P/E ratio	x	17.9	21.5
Price / Book Value ratio	x	2.6	3.1
Market Cap	Rs m	37,212	49,245
Dividends per share (Unadj.)	Rs	2.5	3.0

Ratio Analysis for RALLIS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.8x during FY21, from 1.7x during FY20. 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 45.8x during FY21, from 25.3x during FY20. 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 FY21, from 13.0% during FY21. 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 19.4% during FY21, from 17.4% during FY20. 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 9.1% during FY21, from 7.9% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.7	1.8
Debtors’ Days	Days	730	610
Interest coverage	x	25.3	45.8
Debt to equity ratio	x	0.0	0.0
Return on assets	%	7.9	9.1
Return on equity	%	13.0	14.4
Return on capital employed	%	17.4	19.4

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

RALLIS Share Price Performance

Over the last one year, RALLIS share price has moved up from Rs 175.6 to Rs 252.9, registering a gain of Rs 77.3 or around 44.0%.

Overall, the S&P BSE SENSEX is up 74.1% over the year.

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

Read: Latest Annual Report Analysis of RALLIS