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TRENT 2023-24 Annual Report Analysis

Wed, 22 May

TRENT 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.

TRENT Income Statement Analysis

• Operating income during the year rose 51.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 123.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.4% in FY24 as against 15.8% in FY23.
• Depreciation charges increased by 35.9% and finance costs decreased by 10.1% YoY, respectively.
• Other income grew by 10.9% YoY.
• Net profit for the year grew by 275.3% YoY.
• Net profit margins during the year grew from 5.2% in FY23 to 12.9% in FY24.

TRENT Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	75,552	114,162	51.1%
Other income	Rs m	2,609	2,893	10.9%
Total Revenues	Rs m	78,161	117,054	49.8%
Gross profit	Rs m	11,938	26,703	123.7%
Depreciation	Rs m	4,937	6,711	35.9%
Interest	Rs m	4,090	3,677	-10.1%
Profit before tax	Rs m	5,521	19,208	247.9%
Tax	Rs m	1,584	4,434	179.8%
Profit after tax	Rs m	3,936	14,775	275.3%
Gross profit margin	%	15.8	23.4
Effective tax rate	%	28.7	23.1
Net profit margin	%	5.2	12.9

For Investors: Our Big Prediction

TRENT Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 15 billion as compared to Rs 11 billion in FY23, thereby witnessing an increase of 40.9%.
• Long-term debt stood at Rs 5 billion as compared to Rs 5 billion during FY23, a growth of 0.1%.
• Current assets rose 31% and stood at Rs 31 billion, while fixed assets fell 28% and stood at Rs 40 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 71 billion as against Rs 79 billion during FY23, thereby witnessing a fall of 10%.

TRENT Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	25,955	40,677	56.7
Current Liabilities	Rs m	10,940	15,415	40.9
Long-term Debt	Rs m	4,980	4,986	0.1
Total Liabilities	Rs m	79,255	71,073	-10.3
Current assets	Rs m	23,691	30,967	30.7
Fixed Assets	Rs m	55,477	39,975	-27.9
Total Assets	Rs m	79,255	71,073	-10.3

TRENT Cash Flow Statement Analysis

• TRENT's cash flow from operating activities (CFO) during FY24 stood at Rs 13 billion, an improvement of 126.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -5 billion, an improvement of 395.1% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -6 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 2 billion from the Rs 8 million net cash flows seen during FY23.

TRENT 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	5,949	13,490	126.8%
Cash Flow from Investing Activities	Rs m	-1,026	-5,082	-
Cash Flow from Financing Activities	Rs m	-4,914	-6,295	-
Net Cash Flow	Rs m	8	2,113	25,057.1%

Current Valuations for TRENT

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 41.6, an improvement from the EPS of Rs 11.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 4,629.4, stands at 121.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 40.5 times, while the price to sales ratio stands at 14.4 times.
• The company's price to cash flow (P/CF) ratio stood at 45.9 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	212.5	321.1
TTM Earnings per share	Rs	11.1	41.6
Diluted earnings per share	Rs	11.1	41.6
Price to Cash Flow	x	55.1	45.9
TTM P/E ratio	x	157.6	121.6
Price / Book Value ratio	x	17.5	24.3
Market Cap	Rs m	454,082	986,602
Dividends per share (Unadj.)	Rs	2.2	3.2

Ratio Analysis for TRENT

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.0x during FY24, from 2.2x 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 6.2x during FY24, from 2.3x 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 improved and stood at 36.3% during FY24, from 15.2% 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 50.1% during FY24, from 31.1% 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 26.0% during FY24, from 10.1% 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	2.2	2.0
Debtors’ Days	Days	0	0
Interest coverage	x	2.3	6.2
Debt to equity ratio	x	0.2	0.1
Return on assets	%	10.1	26.0
Return on equity	%	15.2	36.3
Return on capital employed	%	31.1	50.1

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

TRENT Share Price Performance

Over the last one year, TRENT share price has moved up from Rs 1,499.9 to Rs 4,629.4, registering a gain of Rs 3,129.5 or around 208.6%.

Overall, the S&P BSE SENSEX is up 20.6% over the year.

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