RANE ENGINES 2022-23 Annual Report Analysis

Sun, 2 Jul

RANE ENGINES has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

RANE ENGINES Income Statement Analysis

• Operating income during the year rose 30.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 163.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 5.6% in FY23 as against 2.8% in FY22.
• Depreciation charges decreased by 3.6% and finance costs increased by 23.8% YoY, respectively.
• Other income declined by 28.7% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 3.1% in FY22 to 0.0% in FY23.

RANE ENGINES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	3,821	4,976	30.2%
Other income	Rs m	29	21	-28.7%
Total Revenues	Rs m	3,850	4,996	29.8%
Gross profit	Rs m	106	279	163.0%
Depreciation	Rs m	200	193	-3.6%
Interest	Rs m	85	106	23.8%
Profit before tax	Rs m	-150	2	NA
Tax	Rs m	-32	2	NA
Profit after tax	Rs m	-119	-1	NA
Gross profit margin	%	2.8	5.6
Effective tax rate	%	21.0	137.5
Net profit margin	%	-3.1	0.0

Don't Miss: Key Information for Long-term Investors

RANE ENGINES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 11.6%.
• Long-term debt stood at Rs 443 million as compared to Rs 309 million during FY22, a growth of 43.4%.
• Current assets rose 23% and stood at Rs 2 billion, while fixed assets rose 1% and stood at Rs 2 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 4 billion as against Rs 3 billion during FY22, thereby witnessing a growth of 12%.

RANE ENGINES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	934	1,036	10.9
Current Liabilities	Rs m	1,662	1,855	11.6
Long-term Debt	Rs m	309	443	43.4
Total Liabilities	Rs m	3,410	3,818	12.0
Current assets	Rs m	1,757	2,154	22.6
Fixed Assets	Rs m	1,653	1,664	0.7
Total Assets	Rs m	3,410	3,818	12.0

RANE ENGINES Cash Flow Statement Analysis

• RANE ENGINES 's cash flow from operating activities (CFO) during FY23 stood at Rs 206 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -193 million, an improvement of 42.8% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 57 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 71 million from the Rs -228 million net cash flows seen during FY22.

RANE ENGINES Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	-173	206	-
Cash Flow from Investing Activities	Rs m	-135	-193	-
Cash Flow from Financing Activities	Rs m	81	57	-28.8%
Net Cash Flow	Rs m	-228	71	-

Current Valuations for RANE ENGINES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -0.1, an improvement from the EPS of Rs -17.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 297.0, stands at -3,581.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.1 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at 8.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	568.5	704.8
TTM Earnings per share	Rs	-17.6	-0.1
Diluted earnings per share	Rs	-16.4	-0.1
Price to Cash Flow	x	21.4	8.6
TTM P/E ratio	x	-14.7	-3,581.1
Price / Book Value ratio	x	2.2	1.6
Market Cap	Rs m	2,087	1,653
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for RANE ENGINES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.2x during FY23, from 1.1x during FY22. 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 1.0x during FY23, from -0.8x during FY22. 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 -0.1% during FY23, from -12.7% during FY23. 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 7.2% during FY23, from -5.2% during FY22. 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 2.7% during FY23, from -1.0% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	1.1	1.2
Debtors’ Days	Days	8	8
Interest coverage	x	-0.8	1.0
Debt to equity ratio	x	0.3	0.4
Return on assets	%	-1.0	2.7
Return on equity	%	-12.7	-0.1
Return on capital employed	%	-5.2	7.2

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

RANE ENGINES Share Price Performance

Over the last one year, RANE ENGINES share price has moved up from Rs 241.5 to Rs 297.0, registering a gain of Rs 55.6 or around 23.0%.

Overall, the S&P BSE SENSEX is up 21.7% over the year.

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