Formulas

Income Statement
The Income Statement is one of a company’s core financial statements that shows their
profit and loss over a period of time
The income statement is one of three statements used in both corporate finance (including
financial modelling) and accounting. The statement displays the company’s revenue, costs,
gross profit, selling and administrative expenses, other expenses and income
Calculating Total Revenue

The simplest way to calculate sales revenue is to take the average price of the products
you've sold and multiply by the number of units sold. For service industries, revenue is the
average price of services provided times the number of customers.
Total Revenue on the Income Statement

There is no line for total revenue on the income statement, aka the profit and loss statement.
You put sales revenue at the top and then subtract the cost of goods sold and operating
expenses to determine the total operating income.
If you have non-operating income, losses or expenses, report those in the next section. Then
add the two types of revenue together to get the total income. After that, subtract your
income taxes to calculate net income
Total revenue of asian paints 20,515 crores INR (US$2.7 billion, 2020)
International business: (11% of revenues)
Home Improvement business: (2% of revenues)
Industrial coating business (2% of revenues)
₹17,194.1 CRORES Revenue from operations (Standalone)

₹2,654.0 CRORES Profit After Tax (PAT) (Standalone)
Earnings before interest, tax, depreciation, and amortisation (EBITA) has grown at a CAGR
of 13.98% in the last 5 years.
EBIT is used to evaluate a company’s earning potential while serving as a crucial
consideration in changing the capital structure of the business. EBIT is also used by
investors to identify the most profitable companies in terms of operating efficiency
EBITDA margin expanded by 180bps to 22.4% which is the highest ever, and EBITDA
increased 16.7% YoY to Rs 48.6bn. Cut: Gross profit is the revenue earned by a company
after deducting the direct costs of producing its products. The direct labour and direct
material costs used in production are called cost of goods sold.
Depreciation is typically used with fixed assets such as property, plant, and equipment
(PP&E). Depreciation is a method of allocating the cost of an asset over its expected useful
life. Instead of recording the purchase of an asset in year one, which would reduce profits,
businesses can spread that cost out over the years, allowing them to earn revenue from the
asset.
Amortisation is similar to depreciation but is used with intangible assets, such as a patent.
Amortisation spreads out capital expenses of intangible assets over a specific time
frame—typically over the useful life of the asset.
Both depreciation and amortisation are accounting methods designed to help companies
recognize expenses over several years. The expense reduces the amount of profit, allowing
a company to have a lower taxable income. Since depreciation and amortisation are not
typically part of the cost of goods sold—meaning they're not tied directly to
production—they're not included in gross profit.
So depreciation and amortisation of asian paints has grown at a rate of 18% over the last 4
years, current is 799.
PBIDT is profit before interest, depreciation and tax
PBIT :
Like EBIT, PBIT measures an enterprise’s profitability by subtracting operating expenses
from profit, while excluding tax and interest costs.
Also known as operating income, operating profit, and operating earnings, PBIT can be
calculated by adding net profit, interest, and taxes together. It should not, however, be
confused with gross profit.
In PBIT, revenue is deducted with operating expenses (OPEX) excluding interest and taxes.
In contrast, in gross profit, revenue is deducted with only one component of the OPEX – the
cost of goods sold (COGS)
PBIT is commonly used by creditors to screen companies with minimal depreciation and
amortisation activities. They use PBIT because it represents the amount of money
companies can earn to pay off creditors
❖ EBIT = Operating revenue – cost of goods sold – operating expenses

❖ PBIT = Net profit + interest + taxes
PBT : Profit Before Tax

Profit before tax is a measure that looks at a company's profits before the company has to
pay corporate income tax. It essentially is all of a company’s profits without the consideration
of any taxes.
Profit before tax is the value used to calculate a company’s tax obligation.
● Profit before tax is the same as earnings before tax.
● Profit before tax is used to identify how much tax a company owes.
● Profit before tax can also be a profitability measure that provides for greater
comparability among companies that pay a varying amount of taxes.
PAT
Profit After Tax refers to the amount that remains after a company has paid off all of its
operating and non-operating expenses, other liabilities and taxes.
It is an important measure of the company, since it shows the actual amount that a company
is making in that operating year.
So ,in the last 5 years asian paints PAT which is profit after tax growth is of 14.9% CAGR
Net Income
Net income refers to the amount an individual or business makes after deducting costs,
allowances and taxes.
In commerce, net income is what the business has left over after all expenses, including
salary and wages, cost of goods or raw material and taxes. For an individual, net income is
the “take-home” money after deductions for taxes, health insurance and retirement
contributions. Net income should ideally be greater than the expenditure to be indicative of
financial health.
To calculate net income, take the gross income — the total amount of money earned — then
subtract expenses, such as taxes and interest payments.
And the Net profit after non-controlling interest grew 15.8% YoY to Rs 31.4bn in FY21. as
per the latest report the Net profit margin improved to 14.6% from 13.5%
EPS : Earnings per Share

EPS is a financial ratio, which divides net earnings available to common shareholders by the
average outstanding shares over a certain period of time. The EPS formula indicates a
company’s ability to produce net profits for common shareholders. This guide breaks down
the Earnings per Share formula in detail.
A single EPS value for one company is somewhat arbitrary. The number is more valuable
when analysed against other companies in the industry, and when compared to the
company’s share price (the P/E Ratio). Between two companies in the same industry with
the same number of shares outstanding, higher EPS indicates better profitability. EPS is
typically used in conjunction with a company’s share price to determine whether it is
relatively “cheap” (low P/E ratio) or “expensive” (high P/E ratio).
DPS : Dividend Per Share

Dividend per share (DPS) is the sum of declared dividends issued by a company for every
ordinary share outstanding. The figure is calculated by dividing the total dividends paid out
by a business, including interim dividends, over a period of time, usually a year, by the
number of outstanding ordinary shares issued.
A company's DPS is often derived using the dividend paid in the most recent quarter, which
is also used to calculate the dividend yield.
Payout Ratio:
The payout ratio is a financial metric showing the proportion of earnings a company pays its
shareholders in the form of dividends, expressed as a percentage of the company's total
earnings. On some occasions, the payout ratio refers to the dividends paid out as a
percentage of a company's cash flow. The payout ratio is also known as the dividend payout
ratio.

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Income Statement

Calculating Total Revenue

Total Revenue on the Income Statement

₹17,194.1 CRORES Revenue from operations (Standalone)

PBIDT is profit before interest, depreciation and tax

❖ EBIT = Operating revenue – cost of goods sold – operating expenses

PBT : Profit Before Tax

EPS : Earnings per Share

DPS : Dividend Per Share

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