VOLTAS 2023-24 Annual Report Analysis

Tue, 18 Jun

VOLTAS 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.

VOLTAS Income Statement Analysis

• Operating income during the year rose 31.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 60.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 2.7% in FY24 as against 2.2% in FY23.
• Depreciation charges increased by 20.1% and finance costs increased by 88.8% YoY, respectively.
• Other income grew by 51.4% YoY.
• Net profit for the year grew by 82.1% YoY.
• Net profit margins during the year grew from 1.4% in FY23 to 2.0% in FY24.

VOLTAS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	94,988	124,812	31.4%
Other income	Rs m	1,685	2,550	51.4%
Total Revenues	Rs m	96,672	127,362	31.7%
Gross profit	Rs m	2,079	3,343	60.8%
Depreciation	Rs m	396	476	20.1%
Interest	Rs m	296	559	88.8%
Profit before tax	Rs m	3,071	4,858	58.2%
Tax	Rs m	1,709	2,377	39.1%
Profit after tax	Rs m	1,362	2,481	82.1%
Gross profit margin	%	2.2	2.7
Effective tax rate	%	55.6	48.9
Net profit margin	%	1.4	2.0

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VOLTAS Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 58 billion as compared to Rs 46 billion in FY23, thereby witnessing an increase of 24.6%.
• Long-term debt stood at Rs 2 billion as compared to Rs 212 million during FY23, a growth of 978.0%.
• Current assets rose 20% and stood at Rs 77 billion, while fixed assets rose 12% and stood at Rs 43 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 120 billion as against Rs 102 billion during FY23, thereby witnessing a growth of 17%.

VOLTAS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	54,521	58,205	6.8
Current Liabilities	Rs m	46,195	57,564	24.6
Long-term Debt	Rs m	212	2,280	978.0
Total Liabilities	Rs m	102,435	119,944	17.1
Current assets	Rs m	64,465	77,246	19.8
Fixed Assets	Rs m	37,970	42,698	12.5
Total Assets	Rs m	102,435	119,944	17.1

VOLTAS Cash Flow Statement Analysis

• VOLTAS's cash flow from operating activities (CFO) during FY24 stood at Rs 8 billion, an improvement of 377.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -5 billion, an improvement of 540.1% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -1 billion on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 1 billion from the Rs 1 billion net cash flows seen during FY23.

VOLTAS 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	1,594	7,615	377.8%
Cash Flow from Investing Activities	Rs m	-816	-5,224	-
Cash Flow from Financing Activities	Rs m	551	-1,163	-
Net Cash Flow	Rs m	1,328	1,228	-7.5%

Current Valuations for VOLTAS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.5, an improvement from the EPS of Rs 4.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,495.0, stands at 127.9 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 8.5 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 105.4 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	287.1	377.2
TTM Earnings per share	Rs	4.1	7.5
Diluted earnings per share	Rs	4.1	7.5
Price to Cash Flow	x	154.0	105.4
TTM P/E ratio	x	105.4	127.9
Price / Book Value ratio	x	6.3	5.4
Market Cap	Rs m	345,005	311,693
Dividends per share (Unadj.)	Rs	4.3	5.5

Ratio Analysis for VOLTAS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x 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 9.7x during FY24, from 11.4x 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 4.3% during FY24, from 2.5% 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 improved and stood at 9.0% during FY24, from 6.2% 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 2.5% during FY24, from 1.6% 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	1.3
Debtors’ Days	Days	8	7
Interest coverage	x	11.4	9.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	1.6	2.5
Return on equity	%	2.5	4.3
Return on capital employed	%	6.2	9.0

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

VOLTAS Share Price Performance

Over the last one year, VOLTAS share price has moved up from Rs 796.3 to Rs 1,495.0, registering a gain of Rs 698.7 or around 87.7%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 59,803.5 (up 0.5%). Over the last one year it has moved up from 42,891.9 to 59,803.5, a gain of 16,912 points (up 39.4%).

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

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