RELIANCE COMMUNICATIONS 2023-24 Annual Report Analysis

Thu, 12 Sep

RELIANCE COMMUNICATIONS 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.

RELIANCE COMMUNICATIONS Income Statement Analysis

• Operating income during the year fell 39.5% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a growth and stood at 363.1% in FY24 as against 25.9% in FY23.
• Depreciation charges decreased by 17.6% and finance costs decreased by 100.0% YoY, respectively.
• Other income declined by 70.4% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 57.8% in FY23 to 399.0% in FY24.

RELIANCE COMMUNICATIONS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	4,790	2,900	-39.5%
Other income	Rs m	270	80	-70.4%
Total Revenues	Rs m	5,060	2,980	-41.1%
Gross profit	Rs m	-1,240	-10,530	NA
Depreciation	Rs m	1,360	1,120	-17.6%
Interest	Rs m	470	0	-100.0%
Profit before tax	Rs m	-2,800	-11,570	NA
Tax	Rs m	-30	0	NA
Profit after tax	Rs m	-2,770	-11,570	NA
Gross profit margin	%	-25.9	-363.1
Effective tax rate	%	1.1	0.0
Net profit margin	%	-57.8	-399.0

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RELIANCE COMMUNICATIONS Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 1,002 billion as compared to Rs 1,109 billion in FY23, thereby witnessing an decrease of -9.6%.
• Current assets fell 6% and stood at Rs 306 billion, while fixed assets rose 101% and stood at Rs 86 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 392 billion as against Rs 368 billion during FY23, thereby witnessing a growth of 7%.

RELIANCE COMMUNICATIONS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	-748,910	-610,800	NA
Current Liabilities	Rs m	1,108,690	1,001,800	-9.6
Long-term Debt	Rs m	4,450	0	-100.0
Total Liabilities	Rs m	367,630	392,080	6.7
Current assets	Rs m	324,750	305,870	-5.8
Fixed Assets	Rs m	42,880	86,210	101.0
Total Assets	Rs m	367,630	392,080	6.7

RELIANCE COMMUNICATIONS Cash Flow Statement Analysis

• RELIANCE COMMUNICATIONS's cash flow from operating activities (CFO) during FY24 stood at Rs 10 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs 100 million, an improvement of 25.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 0 million, an improvement of 100% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 110 million from the Rs -3 billion net cash flows seen during FY23.

RELIANCE COMMUNICATIONS 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	-640	10	-
Cash Flow from Investing Activities	Rs m	80	100	25.0%
Cash Flow from Financing Activities	Rs m	-220	0	-
Net Cash Flow	Rs m	-2,610	110	-

Current Valuations for RELIANCE COMMUNICATIONS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -4.2, an decline from the EPS of Rs -1.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 2.1, stands at -5.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.0 times, while the price to sales ratio stands at 2.0 times.
• The company's price to cash flow (P/CF) ratio stood at -0.5 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	1.7	1.0
TTM Earnings per share	Rs	-1.0	-4.2
Diluted earnings per share	Rs	-1.0	-4.2
Price to Cash Flow	x	-2.5	-0.5
TTM P/E ratio	x	-1.3	-5.6
Price / Book Value ratio	x	0.0	0.0
Market Cap	Rs m	6,029	4,840
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for RELIANCE COMMUNICATIONS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.3x during FY24, from 0.3x during FY23. The current ratio measures the company's ability to pay short-term and long-term obligations.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at 1.9% during FY24, from 0.4% 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 1.9% during FY24, from 0.3% 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 -3.0% during FY24, from -0.6% 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	0.3	0.3
Debtors’ Days	Days	22	13
Interest coverage	x	-5.0	0.0
Debt to equity ratio	x	0.0	0.0
Return on assets	%	-0.6	-3.0
Return on equity	%	0.4	1.9
Return on capital employed	%	0.3	1.9

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

RELIANCE COMMUNICATIONS Share Price Performance

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