SIS 2023-24 Annual Report Analysis

Tue, 18 Jun

SIS 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.

SIS Income Statement Analysis

• Operating income during the year rose 8.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 8.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 4.4% in FY24 as against 4.4% in FY23.
• Depreciation charges increased by 23.5% and finance costs increased by 29.0% YoY, respectively.
• Other income grew by 33.1% YoY.
• Net profit for the year declined by 45.2% YoY.
• Net profit margins during the year declined from 3.1% in FY23 to 1.5% in FY24.

SIS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	113,458	122,614	8.1%
Other income	Rs m	327	436	33.1%
Total Revenues	Rs m	113,785	123,050	8.1%
Gross profit	Rs m	5,017	5,428	8.2%
Depreciation	Rs m	1,347	1,663	23.5%
Interest	Rs m	1,149	1,482	29.0%
Profit before tax	Rs m	2,849	2,719	-4.6%
Tax	Rs m	-616	819	NA
Profit after tax	Rs m	3,465	1,900	-45.2%
Gross profit margin	%	4.4	4.4
Effective tax rate	%	-21.6	30.1
Net profit margin	%	3.1	1.5

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SIS Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 30 billion as compared to Rs 23 billion in FY23, thereby witnessing an increase of 31.1%.
• Long-term debt down at Rs 2 billion as compared to Rs 8 billion during FY23, a fall of 71.4%.
• Current assets rose 9% and stood at Rs 36 billion, while fixed assets rose 0% and stood at Rs 22 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 58 billion as against Rs 55 billion during FY23, thereby witnessing a growth of 6%.

SIS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	22,998	23,744	3.2
Current Liabilities	Rs m	22,925	30,060	31.1
Long-term Debt	Rs m	8,032	2,301	-71.4
Total Liabilities	Rs m	54,655	57,713	5.6
Current assets	Rs m	32,861	35,839	9.1
Fixed Assets	Rs m	21,791	21,872	0.4
Total Assets	Rs m	54,655	57,713	5.6

SIS Cash Flow Statement Analysis

• SIS's cash flow from operating activities (CFO) during FY24 stood at Rs 4 billion, an improvement of 130.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -525 million from the Rs -2 billion net cash flows seen during FY23.

SIS 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	1,709	3,944	130.7%
Cash Flow from Investing Activities	Rs m	-1,480	-1,044	-
Cash Flow from Financing Activities	Rs m	-2,285	-3,402	-
Net Cash Flow	Rs m	-1,950	-525	-

Current Valuations for SIS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.2, an decline from the EPS of Rs 23.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 447.0, stands at 39.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.7 times, while the price to sales ratio stands at 0.5 times.
• The company's price to cash flow (P/CF) ratio stood at 17.8 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	778.5	850.9
TTM Earnings per share	Rs	23.8	13.2
Diluted earnings per share	Rs	24.0	13.2
Price to Cash Flow	x	9.6	17.8
TTM P/E ratio	x	13.7	39.0
Price / Book Value ratio	x	2.7	2.7
Market Cap	Rs m	61,607	63,447
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for SIS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x during FY24, from 1.4x 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 2.8x during FY24, from 3.5x 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 8.0% during FY24, from 15.1% 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 16.1% during FY24, from 12.9% 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 5.9% during FY24, from 8.4% 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	1.4	1.2
Debtors’ Days	Days	54	56
Interest coverage	x	3.5	2.8
Debt to equity ratio	x	0.3	0.1
Return on assets	%	8.4	5.9
Return on equity	%	15.1	8.0
Return on capital employed	%	12.9	16.1

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

SIS Share Price Performance

Over the last one year, SIS share price has moved up from Rs 413.8 to Rs 447.0, registering a gain of Rs 33.2 or around 8.0%.

Overall, the S&P BSE SENSEX is up 22.2% over the year.

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