TATA POWER 2023-24 Annual Report Analysis

Tue, 25 Jun

TATA 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.

TATA POWER Income Statement Analysis

• Operating income during the year rose 11.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 4.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 20.1% in FY24 as against 21.4% in FY23.
• Depreciation charges increased by 10.1% and finance costs increased by 6.0% YoY, respectively.
• Other income grew by 24.2% YoY.
• Net profit for the year grew by 12.3% YoY.
• Net profit margins during the year grew from 6.9% in FY23 to 7.0% in FY24.

TATA POWER Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	551,091	614,489	11.5%
Other income	Rs m	14,682	18,236	24.2%
Total Revenues	Rs m	565,773	632,725	11.8%
Gross profit	Rs m	117,999	123,282	4.5%
Depreciation	Rs m	34,392	37,864	10.1%
Interest	Rs m	43,719	46,334	6.0%
Profit before tax	Rs m	54,570	57,320	5.0%
Tax	Rs m	16,473	14,519	-11.9%
Profit after tax	Rs m	38,097	42,801	12.3%
Gross profit margin	%	21.4	20.1
Effective tax rate	%	30.2	25.3
Net profit margin	%	6.9	7.0

Dear Reader: If You Invest in Midcap Stocks, this is for You

TATA POWER Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 419 billion as compared to Rs 452 billion in FY23, thereby witnessing an decrease of -7.4%.
• Long-term debt stood at Rs 374 billion as compared to Rs 307 billion during FY23, a growth of 21.8%.
• Current assets fell 2% and stood at Rs 356 billion, while fixed assets rose 15% and stood at Rs 1,023 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 1,391 billion as against Rs 1,281 billion during FY23, thereby witnessing a growth of 9%.

TATA POWER Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	287,874	323,470	12.4
Current Liabilities	Rs m	452,146	418,544	-7.4
Long-term Debt	Rs m	307,085	373,923	21.8
Total Liabilities	Rs m	1,280,961	1,390,544	8.6
Current assets	Rs m	362,251	355,631	-1.8
Fixed Assets	Rs m	885,711	1,022,904	15.5
Total Assets	Rs m	1,280,961	1,390,544	8.6

TATA POWER Cash Flow Statement Analysis

• TATA POWER's cash flow from operating activities (CFO) during FY24 stood at Rs 126 billion, an improvement of 75.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -90 billion, an improvement of 22.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -45 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -9 billion from the Rs 12 billion net cash flows seen during FY23.

TATA 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	71,656	125,961	75.8%
Cash Flow from Investing Activities	Rs m	-73,817	-90,348	-
Cash Flow from Financing Activities	Rs m	13,408	-44,974	-
Net Cash Flow	Rs m	12,433	-9,284	-

Current Valuations for TATA POWER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.4, an improvement from the EPS of Rs 11.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 435.7, stands at 44.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.3 times, while the price to sales ratio stands at 2.3 times.
• The company's price to cash flow (P/CF) ratio stood at 12.4 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	172.5	192.3
TTM Earnings per share	Rs	11.9	13.4
Diluted earnings per share	Rs	11.9	13.4
Price to Cash Flow	x	8.4	12.4
TTM P/E ratio	x	99.6	44.9
Price / Book Value ratio	x	2.7	3.1
Market Cap	Rs m	767,600	998,943
Dividends per share (Unadj.)	Rs	2.0	2.0

Ratio Analysis for TATA POWER

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.8x during FY24, from 0.8x 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 2.2x during FY24, from 2.2x 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 13.2% during FY24, from 13.2% 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 declined and down at 14.9% during FY24, from 16.5% 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 6.4% during FY24, from 6.4% 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	0.8	0.8
Debtors’ Days	Days	5	4
Interest coverage	x	2.2	2.2
Debt to equity ratio	x	1.1	1.2
Return on assets	%	6.4	6.4
Return on equity	%	13.2	13.2
Return on capital employed	%	16.5	14.9

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

TATA POWER Share Price Performance

Over the last one year, TATA POWER share price has moved up from Rs 218.2 to Rs 435.7, registering a gain of Rs 217.5 or around 99.7%.

Meanwhile, the S&P BSE POWER Index is trading at Rs 7,915.7 (up 1.3%). Over the last one year it has moved up from 3,937.6 to 7,915.7, a gain of 3,978 points (up 101.0%).

Overall, the S&P BSE SENSEX is up 21.8% over the year.

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