Financial Analysis - Monsanto India

7/31/2019 Financial Analysis - Monsanto India

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SantoshJK



1

BalanceSheet

(incrore)

Particulars Asof Asof31stMar’2012 31stMar’2011

EQUITYANDLIABILITIES

(1)Shareholder’sFunds

(a)ShareCapital 17.26 8.63

(b)ReservesandSurplus 367.13 365.69

384.39 374.32

(2)NonCurrentLiabilities

(a)Otherlongtermliabilities 5.49 5.04

(b)Longtermprovisions 5.99 5.47

11.48 10.51

(3)CurrentLiabilities

(a)Tradepayables 74.98 53.49

(b)Othercurrentliabilities 28.75 24.54

(c)Shorttermprovisions 27.41 20.92

131.14 98.95

TOTAL 527.01 483.78

ASSETS

(1)NonCurrentAssets (a)Fixedassets

(i)Tangibleassets 80.38 86.49

(ii)Intangiableassets 0.48 1.15

(iii)Capitalwork-in-progress 11.13 5.08

91.99 92.72

(b)Deferredtaxassets(net) 2.72 2.96

(c)Longtermloansandadvances 8.15 8.03

102.86 103.71

(2)CurrentAssets

(a)Currentinvestments 195.78 151.36

(b)Inventories 129.68 130.32

(c)Tradereceivables 50.27 40.85

(d)Cashandcashequivalents 18.99 17.17

(e)Short-termloansandadvances 17.61 29.45

(f)Othercurrentassets 11.82 10.92

424.15 380.07

TOTAL 527.01 483.78



2

ProfitLossStatement

(incrore)

Particulars

Asof

Asof

31stMar’

2012

31stMar’

2011

I RevenuefromOperations(Gross) 385.99 374.71

Less:ExciseDuty 12.22 11.3

RevenuefromOperations(Net) 373.77 363.41

II OtherIncome 15.15 8.35

III TotalRevenue(I+II) 388.92 371.76

IV Expense

(a)Costofmaterialsconsumedandotherinputs 155.38 98.89 (b)PurchaseofStock-in-Trade-Agriculturalchemicals 0.34

(c)Changesininventoriesoffinishedgoods,

work-in-progressandStock-in-Trade” 7.24 50.01

(d)Employeebenefitsexpense 45.61 43.26

(e)Financecosts 1.28 0.28

(f)Depreciationandamortizationexpense 9 10.81

(g)Otherexpenses 110.19 106.05

TOTALEXPENSES 329.04 309.3

V Profitbeforeexceptionalitemsandtax(III-IV) 59.88 62.46

VI ExceptionalItems

(a)DiminutioninvalueofFixedAssetsheldforSale -12.17

(b)ProfitonSaleofFixedAssetsheldforSale 0.26

VII Profitbeforetax(V+VI) 60.14 50.29

VIII Taxexpense:

(a)Currenttax 7.14 6.11

(b)Taxprovisioninrespectofearlieryears 2.57 1.82

(c)Deferredtaxexpense/(credit) 0.24 -0.47

IX Profitfortheyearfromcontinuingoperations(VII-VIII) 50.19 42.83

X EarningsperequityshareoffacevalueofRs10/-each (1)Basic(inRs) 29.07 24.81

(2)Diluted(inRs) 29.07 24.81



3

FinancialStatementAnalysis

Earningspershare

Earningspershare Rs.29.07

for2011,


TheEarningspersharehasincreasedsignificantlyoverthepreviousyear,showsthe

companyisingoodhealthfinancially.

Priceearningmultiple


Marketpricepershare Rs.657.65

= !"#$%& !"#$% !"# !!!"#!"#$%$&' !"# !"#$%

Priceearningmultiple =657.65/29.07 =Rs.22.62

ReturnonInvestment(ROI)

NetIncome Rs.50.19Cr

Interest Rs.1.28Cr

TotalShareholderfund Rs.384.39Cr

Longtermliability Rs.11.48Cr

Tax 30%

= !"# !"#$%& ! !!!"#

!"#$% !!!"#!!"#$% !"#$ ! !"#$ !"#$ !"#$"%"&'

ReturnonInvestment(ROI) =(50.19+1.28*(1-0.3))/(384.39+11.48)

=0.13

for2011,

ReturnonInvestment(ROI) =0.11

ReturnonInvestmentshasincreasedoverthepreviousyear,meaningthebusiness

hasbecomemoreprofitable.



4

ReturnonEquity(ROE)

NetIncome Rs.50.19Cr


=

ℎℎ

ReturnonEquity(ROE) =50.19/384.39 =0.13

for2011,

ReturnonEquity(ROE)=0.11

ReturnonEquityhasincreasedoverthepreviousyear,meaningthebusinesshas

becomemoreprofitabletotheshareholders.

GrossMargin

GrossProfit Rs.165.2Cr

NetSales Rs.373.77Cr

= !"#$$ !"#$%&!"# !"#$%

GrossMargin =165.2/373.77 =0.44

for2011,

GrossMargin =0.47

GrossMarginisrelativelylowerthanthepreviousyear;thepercentchangeincostof

consumptionismorethantheSalesRevenue.

NetMargin

NetIncome Rs.50.19Cr NetSales Rs.373.77Cr

= !"# !"#$%&

!"# !"#$%

Netmargin =50.19/373.77 =0.13

for2011,

Netmargin =0.12



5

NetmarginhasimprovedeventhoughthereisadropintheGrossmarginforthe

period,that’sbecauseofsomeassetreleasedinthepreviousperiod,bringingdown

thenetprofitsinthepreviousperiod.

Debt/EquityRatio



/ = !"#$ !"#$ !"#$"!"%&!"#$% !!!"#!!"#$% !"#$

Debt/EquityRatio =11.48/384.39 =0.03

for2011,

Debt/EquityRatio =0.03

Lowdebt/equityshowsthecompany’spreferencetoraisefundsthroughequity

ratherthandebt.

InterestCoverageRatio

ProfitbeforeTax,Interest Rs.58.60Cr

Interest Rs.1.28Cr

= !"#$%& !"#$%" !"#,!"#$%$&#

!"#$%$&#

InterestCoverageRatio =62.18/1.28 =45.78

for2011,

InterestCoverageRatio=222.07

InterestCoverageratioisimpacteddueto450%increaseinInterestpayments.

FinancialLeverageRatio

TotalAssets Rs.527.01Cr


= !"#$% !""#$"!"#$% !"#$%"&'(%$ !"#$

FinancialLeverageRatio =527.01/384.39 =1.37



6

for2011,

FinancialLeverageRatio =1.29

LeveragehasincreasedbycreationofnewAsset’sintheformofinvestments.

Debttototalcapitalization



=

(Total Shareholder fund+ Long term liability)

Debttototalcapitalization =11.48/(384.39+11.48) =0.03for2011,

Debttototalcapitalization =0.03

Thecompanyhassufficientcoverforthedebtitowes.

InventoryTurnoverRatio

CostofGoodsSold Rs.208.57CrAverageInventory Rs.12.19Cr

= Average Inventory

InventoryTurnoverRatio =208.57/12.19 =17.11

for2011,

InventoryTurnoverRatio =17.98

RateofInventoryreplenishmenthasincreased.

AssetsTurnoverRatio


TotalAssets Rs.527.01Cr

=



7

AssetsTurnoverRatio =373.77/527.01 =0.71

for2011,

AssetsTurnoverRatio =0.75

Ratiohasdroppedbecausethe%ofchangeofsaleshasbeensmallerthan%change

ofassets.

NoofDaystoCollect

TradeReceivables Rs.50.27Cr


= /365

NoofDaystoCollect =50.27*365/373.77 =49.09Days

For2011,

NoofDaystoCollect =41.03Days

Company’sinefficiencytocollectthemoneyhasworsenedforthisperiod.

NoofDaystoPay

TradePayables Rs.74.98Cr

CostofGoodsSold Rs.208.57Cr

= /365

NoofDaystoPay =74.98*365/208.57 =131.22Days

For2011,

NoofDaystoPay =101.60Days

Company’sinefficiencytopaythemoneyhasworsenedforthisperiod.

NoofDaysInventoryStaysinentity

AverageInventory Rs.12.19Cr

CostofGoodsSold Rs.208.57Cr



8

= Cost of Goods Sold/365

NoofDaysInventoryStaysinentity=12.19*365/208.57 =21.33Days

for2011

NoofDaysInventoryStaysinentity =20.31Days

Inventoryutilizationhasworsened.

CurrentRatio

CurrentAssets Rs.424.15Cr

CurrentLiabilitues Rs.131.14Cr

= Current Liabilitues

CurrentRatio =424.15/131.14 =3.23

for2011,

CurrentRatio =3.84

CurrentLiabilitiesforthecurrentyearhasincreased,whichisevidentinthedropin

currentratio.Butthecompanyisstillinverygoodshapefinancially,tocoverforthe

currentliabilities.

QuickRatio

MonetoryAssets Rs.294.47Cr

CurrentLiabilitues Rs.131.14Cr

=

QuickRatio =294.47/131.14 =2.25

for2011,

QuickRatio =2.52

CurrentLiabilitiesforthecurrentyearhasincreased,whichisevidentinthedropin

Quickratio.Butthecompanyisstillinverygoodshapefinancially,tocoverforthe

currentliabilities.



9

Overallanalysis

Thecompany’sfinancialhealthisingoodshape.ThereturnonInvestment,

ReturnonEquityhasincreased.Equitypershareisgrowingsteadily.Market

valueoftheshareisover22timesitsEquitypershare.

Debtproportionofthecompanyisless,sotheabilitytorepayissignificantly

high.Mostoftheinvestmentscomefromshareholdersequityandreserves.

TimeperiodbetweenCollectionandPaymentissignificantenoughtomanage

theflowofcashbutthecompanyseemstoincreasethenumberofdaysonboth

fronts.

Inventorystayinentityandinventoryreplenishmentisaslessas17and21

days.Thegoodsaremovingfasterandregularly.

Documents

Financial Analysis - Monsanto India