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    FA Project V - 2019

    Uploaded by

    Jatin Shah
    Operating income for Vedanta increased slightly by 1.4% YoY, while operating profit fell 15.7% and margins decreased. Net profit declined sharply by 29.2% and margins fell from 15.1% to 10.5%. Current liabilities rose 14% and long-term debt increased 29.6%, while current assets rose 9% and fixed assets 11%. Overall assets and liabilities increased 11%. Cash flow from operations rose 36.8% but investing activities declined, while financial activities improved 74%; net cash flow turned positive. Ratios like ROE, ROCE and ROA all declined, showing reduced profitability.

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    FA Project V - 2019

    Uploaded by

    Jatin Shah
    17 views2 pages
    Operating income for Vedanta increased slightly by 1.4% YoY, while operating profit fell 15.7% and margins decreased. Net profit declined sharply by 29.2% and margins fell from 15.1% to 10.5%. Current liabilities rose 14% and long-term debt increased 29.6%, while current assets rose 9% and fixed assets 11%. Overall assets and liabilities increased 11%. Cash flow from operations rose 36.8% but investing activities declined, while financial activities improved 74%; net cash flow turned positive. Ratios like ROE, ROCE and ROA all declined, showing reduced profitability.

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    FA Project V_2019

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    Operating income for Vedanta increased slightly by 1.4% YoY, while operating profit fell 15.7% and margins decreased. Net profit declined sharply by 29.2% and margins fell from 15.1% to 10.5%. Current liabilities rose 14% and long-term debt increased 29.6%, while current assets rose 9% and fixed assets 11%. Overall assets and liabilities increased 11%. Cash flow from operations rose 36.8% but investing activities declined, while financial activities improved 74%; net cash flow turned positive. Ratios like ROE, ROCE and ROA all declined, showing reduced profitability.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    17 views2 pages

    FA Project V - 2019

    Uploaded by

    Jatin Shah
    Operating income for Vedanta increased slightly by 1.4% YoY, while operating profit fell 15.7% and margins decreased. Net profit declined sharply by 29.2% and margins fell from 15.1% to 10.5%. Current liabilities rose 14% and long-term debt increased 29.6%, while current assets rose 9% and fixed assets 11%. Overall assets and liabilities increased 11%. Cash flow from operations rose 36.8% but investing activities declined, while financial activities improved 74%; net cash flow turned positive. Ratios like ROE, ROCE and ROA all declined, showing reduced profitability.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    of 2

    VEDANTA Income Statement Analysis

     Operating income increased 1.4% year over year (YoY) during the year.

     During the fiscal, the company's operating profit fell by 15.7% YoY. Operating profit margins
    decreased, falling from 30.6% in FY18 to 25.4% in FY19.

     Depreciation charges went up by 30.4% year over year, while borrowing costs went up by
    11.3%.

     Other income grew by 26.4% YoY.

     Net profit for the year fell by 29.2% year over year.

     Net profit margins decreased from 15.1% in FY18 to 10.5% in FY19 over the course of the year.

    VEDANTA Balance Sheet Analysis


     The company's current liabilities increased 14.0% in the fiscal year 2019 to Rs 766 billion from
    Rs 672 billion in the prior year.

     The long-term debt increased by 29.6% to Rs 347 billion from Rs 268 billion in FY18.

     In FY19, current assets increased by 9% to reach Rs 598 billion, while fixed assets increased by
    11% to reach Rs 1,387 billion.

     Overall, the assets and liabilities for the fiscal year 2019 increased by 11% to Rs 1,986 billion
    from Rs 1,797 billion in the previous fiscal year.

    VEDANTA Cash Flow Statement Analysis


     Cash flow from operating activities (CFO) for VEDANTA in FY19 was Rs 238 billion, up
    36.8% year over year.

     On a year-over-year basis, cash flow from investing activities (CFI) during FY19 totaled Rs -
    105 billion.

     During FY19, cash flow from financial activities (CFF) was Rs -102 billion, an improvement of
    74% year over year.

     Overall, the company's net cash flows for FY19 were Rs 29 billion as opposed to Rs -64 billion
    for FY18.

    Current Valuations for VEDANTA


     The company's trailing twelve-month profits per share (EPS) are Rs 26.1, down from the EPS of
    Rs 36.8 recorded the previous year.

     At the present price of Rs. 183.8, the price to earnings (P/E) ratio is 5.0 times its trailing twelve-
    month earnings.
     At the present price levels, the price to book value (P/BV) ratio is 1.1 times, but the price to
    sales ratio is 0.7 times.

     The company's price to cash flow (P/CF) ratio was 4.8 times its operational cash flow earnings
    at the end of the year.

    Ratio Analysis for VEDANTA

     Solvency Ratios
    Current Ratio: From 0.8x in FY18 to 0.8x in FY19, the company's current ratio declined. The
    company's capacity to meet both short- and long-term obligations is gauged by the current ratio.

    Interest Coverage Ratio: From 4.8x in FY18 to 3.4x in FY19, the company's interest coverage
    ratio declined. The ease with which a corporation can pay its interest expense on outstanding
    debt is shown by its interest coverage ratio. The ratio should be higher.

     Profitability Ratios
    Return on Equity (ROE): In FY19, the company's ROE decreased and fell to 15.6% from
    FY18's 21.7%. The ROE gauges a company's capacity to make a profit using the investment of
    its shareholders.

    Return on Capital Employed (ROCE): In FY19, the company's ROCE decreased and fell to
    19.9% from FY18's 27.4%. The ROCE gauges a company's capacity to turn a profit from the
    total capital (shareholder and borrowed capital) it has on hand.

    Return on Assets (ROA): From 10.5% in FY18 to 7.7% in FY19, the company's ROA
    decreased. The ROA gauges how effectively a corporation generates profits from its assets.

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