HONDA POWER PRODUCTS 2023-24 Annual Report Analysis

Mon, 12 Aug

HONDA POWER PRODUCTS 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.

HONDA POWER PRODUCTS Income Statement Analysis

• Operating income during the year fell 20.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 12.5% YoY during the fiscal. Operating profit margins witnessed a fall and down at 10.4% in FY24 as against 9.4% in FY23.
• Depreciation charges decreased by 2.7% and finance costs decreased by 18.5% YoY, respectively.
• Other income grew by 116.8% YoY.
• Net profit for the year grew by 8.4% YoY.
• Net profit margins during the year grew from 6.8% in FY23 to 9.3% in FY24.

HONDA POWER PRODUCTS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	12,463	9,891	-20.6%
Other income	Rs m	192	416	116.8%
Total Revenues	Rs m	12,655	10,306	-18.6%
Gross profit	Rs m	1,177	1,029	-12.5%
Depreciation	Rs m	208	202	-2.7%
Interest	Rs m	7	5	-18.5%
Profit before tax	Rs m	1,154	1,237	7.2%
Tax	Rs m	303	315	4.0%
Profit after tax	Rs m	851	922	8.4%
Gross profit margin	%	9.4	10.4
Effective tax rate	%	26.3	25.5
Net profit margin	%	6.8	9.3

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HONDA POWER PRODUCTS Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 2 billion as compared to Rs 2 billion in FY23, thereby witnessing an decrease of -6.6%.
• Current assets rose 3% and stood at Rs 8 billion, while fixed assets rose 28% and stood at Rs 2 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 10 billion as against Rs 9 billion during FY23, thereby witnessing a growth of 7%.

HONDA POWER PRODUCTS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	7,367	8,121	10.2
Current Liabilities	Rs m	1,914	1,788	-6.6
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	9,156	9,815	7.2
Current assets	Rs m	7,495	7,691	2.6
Fixed Assets	Rs m	1,661	2,124	27.9
Total Assets	Rs m	9,156	9,815	7.2

HONDA POWER PRODUCTS Cash Flow Statement Analysis

• HONDA POWER PRODUCTS's cash flow from operating activities (CFO) during FY24 stood at Rs 1 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -987 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -175 million on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -86 million from the Rs -72 million net cash flows seen during FY23.

HONDA POWER PRODUCTS 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	1,573	1,056	-32.9%
Cash Flow from Investing Activities	Rs m	-1,499	-987	-
Cash Flow from Financing Activities	Rs m	-162	-175	-
Net Cash Flow	Rs m	-72	-86	-

Current Valuations for HONDA POWER PRODUCTS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 90.9, an improvement from the EPS of Rs 83.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,875.3, stands at 43.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.8 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 23.0 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	1,229.1	975.4
TTM Earnings per share	Rs	83.9	90.9
Diluted earnings per share	Rs	83.9	90.9
Price to Cash Flow	x	19.3	23.0
TTM P/E ratio	x	24.0	43.0
Price / Book Value ratio	x	2.8	3.2
Market Cap	Rs m	20,922	25,825
Dividends per share (Unadj.)	Rs	16.5	17.5

Ratio Analysis for HONDA POWER PRODUCTS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 4.3x during FY24, from 3.9x 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 234.5x during FY24, from 178.5x 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 declined and down at 11.4% during FY24, from 11.5% 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 15.3% during FY24, from 15.8% 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 9.4% during FY24, from 9.4% 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	3.9	4.3
Debtors’ Days	Days	207	187
Interest coverage	x	178.5	234.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.4	9.4
Return on equity	%	11.5	11.4
Return on capital employed	%	15.8	15.3

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

HONDA POWER PRODUCTS Share Price Performance

Over the last one year, HONDA POWER PRODUCTS share price has moved up from Rs 2,337.4 to Rs 3,875.3, registering a gain of Rs 1,537.9 or around 65.8%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 58,802.5 (up 0.7%). Over the last one year it has moved up from 43,196.4 to 58,802.5, a gain of 15,606 points (up 36.1%).

Overall, the S&P BSE SENSEX is up 21.4% over the year.

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