STAR PAPER 2022-23 Annual Report Analysis

Wed, 13 Sep

STAR PAPER 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.

STAR PAPER Income Statement Analysis

• Operating income during the year rose 49.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 110.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 13.7% in FY23 as against 9.7% in FY22.
• Depreciation charges decreased by 1.6% and finance costs increased by 17.9% YoY, respectively.
• Other income grew by 20.4% YoY.
• Net profit for the year grew by 79.2% YoY.
• Net profit margins during the year grew from 11.1% in FY22 to 13.3% in FY23.

STAR PAPER Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	3,305	4,927	49.1%
Other income	Rs m	180	217	20.4%
Total Revenues	Rs m	3,486	5,144	47.6%
Gross profit	Rs m	320	675	110.8%
Depreciation	Rs m	54	53	-1.6%
Interest	Rs m	5	6	17.9%
Profit before tax	Rs m	442	833	88.6%
Tax	Rs m	75	177	134.1%
Profit after tax	Rs m	366	657	79.2%
Gross profit margin	%	9.7	13.7
Effective tax rate	%	17.1	21.2
Net profit margin	%	11.1	13.3

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STAR PAPER Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 545 million as compared to Rs 527 million in FY22, thereby witnessing an increase of 3.4%.
• Current assets rose 27% and stood at Rs 3 billion, while fixed assets fell 1% and stood at Rs 4 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 7 billion as against Rs 7 billion during FY22, thereby witnessing a growth of 8%.

STAR PAPER Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	5,348	5,944	11.1
Current Liabilities	Rs m	527	545	3.4
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	6,718	7,284	8.4
Current assets	Rs m	2,249	2,860	27.2
Fixed Assets	Rs m	4,469	4,424	-1.0
Total Assets	Rs m	6,718	7,284	8.4

STAR PAPER Cash Flow Statement Analysis

• STAR PAPER's cash flow from operating activities (CFO) during FY23 stood at Rs 468 million, an improvement of 150.5% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -411 million, an improvement of 205.6% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -65 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -9 million from the Rs 3 million net cash flows seen during FY22.

STAR PAPER 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	187	468	150.5%
Cash Flow from Investing Activities	Rs m	-135	-411	-
Cash Flow from Financing Activities	Rs m	-49	-65	-
Net Cash Flow	Rs m	3	-9	-

Current Valuations for STAR PAPER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 42.1, an improvement from the EPS of Rs 23.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 219.3, stands at 4.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.6 times, while the price to sales ratio stands at 0.7 times.
• The company's price to cash flow (P/CF) ratio stood at 3.9 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	211.7	315.6
TTM Earnings per share	Rs	23.5	42.1
Diluted earnings per share	Rs	23.5	42.1
Price to Cash Flow	x	5.9	3.9
TTM P/E ratio	x	6.8	4.9
Price / Book Value ratio	x	0.4	0.5
Market Cap	Rs m	2,261	2,745
Dividends per share (Unadj.)	Rs	3.5	5.0

Ratio Analysis for STAR PAPER

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 5.2x during FY23, from 4.3x 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 150.1x during FY23, from 94.2x 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 11.0% during FY23, from 6.9% 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 14.1% during FY23, from 8.4% 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 9.1% during FY23, from 5.5% 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	4.3	5.2
Debtors’ Days	Days	66	19
Interest coverage	x	94.2	150.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	5.5	9.1
Return on equity	%	6.9	11.0
Return on capital employed	%	8.4	14.1

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

STAR PAPER Share Price Performance

Over the last one year, STAR PAPER share price has moved up from Rs 213.8 to Rs 219.3, registering a gain of Rs 5.6 or around 2.6%.

Overall, the S&P BSE SENSEX is up 12.0% over the year.

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