RELIANCE POWER 2023-24 Annual Report Analysis

Tue, 16 Jul

RELIANCE POWER 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 POWER Income Statement Analysis

• Operating income during the year rose 5.0% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 61.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 14.2% in FY24 as against 38.6% in FY23.
• Depreciation charges increased by 4.4% and finance costs decreased by 2.1% YoY, respectively.
• Other income grew by 8.1% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 4.6% in FY23 to 28.4% in FY24.

RELIANCE POWER Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	75,139	78,926	5.0%
Other income	Rs m	3,401	3,676	8.1%
Total Revenues	Rs m	78,540	82,602	5.2%
Gross profit	Rs m	29,018	11,173	-61.5%
Depreciation	Rs m	10,167	10,618	4.4%
Interest	Rs m	25,041	24,513	-2.1%
Profit before tax	Rs m	-2,790	-20,282	NA
Tax	Rs m	639	2,140	234.9%
Profit after tax	Rs m	-3,429	-22,422	NA
Gross profit margin	%	38.6	14.2
Effective tax rate	%	-22.9	-10.6
Net profit margin	%	-4.6	-28.4

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RELIANCE POWER Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 179 billion as compared to Rs 184 billion in FY23, thereby witnessing an decrease of -2.7%.
• Long-term debt down at Rs 94 billion as compared to Rs 122 billion during FY23, a fall of 23.1%.
• Current assets fell 8% and stood at Rs 45 billion, while fixed assets fell 10% and stood at Rs 391 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 439 billion as against Rs 486 billion during FY23, thereby witnessing a fall of 10%.

RELIANCE POWER Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	115,154	116,139	0.9
Current Liabilities	Rs m	183,754	178,838	-2.7
Long-term Debt	Rs m	122,404	94,095	-23.1
Total Liabilities	Rs m	486,170	438,506	-9.8
Current assets	Rs m	49,530	45,452	-8.2
Fixed Assets	Rs m	435,916	391,018	-10.3
Total Assets	Rs m	486,170	438,506	-9.8

RELIANCE POWER Cash Flow Statement Analysis

• RELIANCE POWER's cash flow from operating activities (CFO) during FY24 stood at Rs 32 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -27 billion, an improvement of 25% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 2 billion from the Rs 464 million net cash flows seen during FY23.

RELIANCE POWER 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	40,237	31,739	-21.1%
Cash Flow from Investing Activities	Rs m	-3,542	-1,922	-
Cash Flow from Financing Activities	Rs m	-36,231	-27,342	-
Net Cash Flow	Rs m	464	2,475	433.2%

Current Valuations for RELIANCE POWER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -5.6, an decline from the EPS of Rs -0.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 28.4, stands at -5.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.0 times, while the price to sales ratio stands at 1.4 times.
• The company's price to cash flow (P/CF) ratio stood at -7.3 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	20.1	19.6
TTM Earnings per share	Rs	-0.9	-5.6
Diluted earnings per share	Rs	-0.9	-5.6
Price to Cash Flow	x	5.9	-7.3
TTM P/E ratio	x	-11.3	-5.1
Price / Book Value ratio	x	0.6	0.7
Market Cap	Rs m	63,499	86,465
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for RELIANCE POWER

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated 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.

Interest Coverage Ratio: The company's interest coverage ratio deteriorated and stood at 0.2x during FY24, from 0.9x 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 declined and down at -19.3% during FY24, from -3.0% 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 declined and down at 2.0% during FY24, from 9.4% 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 0.5% during FY24, from 4.4% 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	1,302	765
Interest coverage	x	0.9	0.2
Debt to equity ratio	x	1.1	0.8
Return on assets	%	4.4	0.5
Return on equity	%	-3.0	-19.3
Return on capital employed	%	9.4	2.0

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

RELIANCE POWER Share Price Performance

Over the last one year, RELIANCE POWER share price has moved up from Rs 15.3 to Rs 28.4, registering a gain of Rs 13.2 or around 86.4%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 8,071.2 (down 0.3%). Over the last one year it has moved up from 3,972.3 to 8,071.2, a gain of 4,099 points (up 103.2%).

Overall, the S&P BSE SENSEX is up 23.4% over the year.

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