UNDERSTAND THE BRITANNIA INDUSTRIES LIMITED-FINANCIAL MODELING ASPECT

 

1. Income Statement

Here's the Income Statement for Britannia Industries Limited presented in tabular form: (Figures in Crores)

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
1. Revenue from operations
Sale of goods / Income from operations	11443.99	12883.04	13944.67	15984.9	16500	17000	17500	18000
Other operating revenues	155.56	253.1	191.59	315.65
Total revenue from operations	11599.55	13136.14	14136.26	16300.55	16500	17000	17500	18000
2. Other Income	279.4	312.87	222.83	215.86	220.18	224.58	229.07	233.65
3. Total Income	11878.95	13449.01	14359.09	16516.41	16720.1772	17224.58074	17729.07236	18233.65381
4. Expenses
Cost of materials consumed	5684.98	6502.33	7473.97	8326.7	9999.36	10785.32	11414.27	11762.49
Purchases of stock in trade	1189.92	1160.89	1361.59	1337.13	1881.00	1938.00	1995.00	2052.00
Changes in inventories of finished goods, stock in trade and work in progress	52.57	-37.12	-75.26	-72.53	-1980.36	-2523.32	-2909.27	-3014.49
Employee Benefit expense	486.69	527.38	542.26	658.38	660	680	700	720
Finance cost	76.9	110.9	144.29	169.1
Depreciation and amortisation cost	184.81	197.85	200.54	225.91	296.42	343.84	396.26	446.90
Other expenses	2342.21	2473.37	2632.19	3219.96	3217.5	3315	3412.5	3510
Total expenses	10018.08	10935.6	12279.58	13864.65	14073.92	14538.84	15008.76	15476.90
5. Profit before share of associates	1860.87	2513.41	2079.51	2651.76	2646.26	2685.74	2720.32	2756.75
6. Share of profit / (loss) of associates	0.44	0.81	-0.2	5.41
7. Profit before exceptional items and tax	1861.31	2514.22	2079.31	2657.17	2646.26	2685.74	2720.32	2756.75
8. Exceptional items{(Income)/Expense}	17.01	0.61	0.98	-375.6
9. Profit before tax	1844.3	2513.61	2078.33	3032.77	2646.26	2685.74	2720.32	2756.75
10. Tax expense:
A) Current Tax	447.69	657.12	612.24	720.97	641.85	664.72	673.28	682.30
B) Deferred Tax charge/(credit)	3.01	5.9	-49.89	-4.52	6.48	6.71	6.80	6.89
Total tax expenses	450.7	663.02	562.35	716.45	648.33	671.43	680.08	689.19
11. Profit for the period / year (9-10)	1393.6	1850.59	1515.98	2316.32	1997.93	2014.30	2040.24	2067.56
12. Other comprehensive income (net of tax)
A (i) Items that will not be reclassified subsequently to profit or loss	-6.5	3.5	0.17	-0.16
(ii) Income tax relating to items that will not be reclassified subsequently to profit or loss	1.57	-0.92	-0.05	0.04
B Items that will be reclassified subsquently to profit or loss
Foreign currency translation reserve	10.05	-4.08	6.17	15.43
Total other comprehensve income (net of tax)	5.12	-1.5	6.29	15.31	0.00	0.00	0.00	0.00
13. Total comprehensive income for the year(11+12)	1398.72	1849.09	1522.27	2331.63	1997.93	2014.30	2040.24	2067.56
14. Profit attributable to :
Owner of the company	1402.63	1863.9	1524.82	2321.77
Non controlling interest	-9.03	-13.31	-8.84	-5.47
Profit for the period	1393.6	1850.59	1515.98	2316.3	0	0	0	0
15. Other comprehensive income attributable to :
Owner of the company	5.12	-1.5	6.29	15.38
Non controlling interest	-	-		-0.07
Other comprehensive income for the period	5.12	-1.5	6.29	15.31	0	0	0	0
16. Total comprehensive income attributable to:
Owner of the company	1407.75	1862.4	1524.82	2337.15
Non controlling interest	-9.03	-13.31	-8.84	-5.52
Total comprehensive income for the period	1398.72	1849.09	1515.98	2331.63	0	0	0	0
17. Paid up equity share capital (face  value of Rs1 each)
18. Paid up debt capital
19. Other equity
20. Net worth
21. Debenture redemption reserve
22. Earning per share( Face value of Rs1 each) (not annualised)
A) Basic EPS	58.35	77.43	63.31	96.39
B) Diluted EPS	58.34	77.4	63.31	96.39
23. Debt equity ratio
24. Debt service coverage ratio
25. Interest service coverage ratio
Weighted average number of equity shares used in computing earning per share:
Basic	24,03,79,360	24,07,16,747	240868296	240868296
Diluted	24,04,38,381	24,08,00,190	240868296	240868296

ANALYSIS

Revenue Trends:

BIL's revenue from operations has shown consistent growth from 2020 to the forecasted period of 2027. This growth indicates the company's ability to increase sales over time, which is a positive indicator of business performance and market demand.

The forecasted revenue continues to grow steadily, reaching ?18,000 crores by 2027, demonstrating optimism regarding future business prospects.

Expense Management:

Cost of materials consumed and purchases of stock in trade have increased steadily over the years, indicating rising input costs or increased production volumes.

Notably, changes in inventories show fluctuation, with negative values in some years, suggesting potential inventory management challenges.

Other expenses have also increased, reflecting growing operational costs, which could include marketing expenses, administrative costs, and other overheads.

Despite increasing expenses, BIL has maintained profitability, as indicated by the consistent growth in profit before tax.

Profitability:

 BIL's profitability has been robust, with profits consistently increasing over the years.

The company has demonstrated resilience even in challenging periods, as seen in the increase in profit before tax in 2023 despite exceptional items.

However, there is a slight decrease in profit in the forecasted period of 2024, which may warrant further investigation into potential factors affecting profitability.

Comprehensive Income and Equity:

BIL's total comprehensive income has shown a positive trend, indicating the company's ability to generate profits and manage other comprehensive income components effectively.

The paid-up equity share capital remains constant, suggesting no significant dilution or issuance of new equity shares during the period.

The debt equity ratio, debt service coverage ratio, and interest service coverage ratio would provide insights into BIL's financial leverage and ability to meet its debt obligations, which are essential metrics for evaluating financial health. However, these ratios are not provided in the income statement.

Earnings Per Share (EPS):

 

BIL's EPS has shown consistent growth over the years, reflecting the company's ability to generate profits on a per-share basis.

This growth in EPS indicates enhanced shareholder value and potential attractiveness to investors.

Forecast and Future Outlook:

The forecasted revenue and profitability reflect management's expectations for future growth and financial performance.

However, it's essential to consider external factors such as market conditions, regulatory changes, and competitive pressures that could impact actual results.

In conclusion, Britannia Industries Limited has demonstrated strong revenue growth, effective expense management, and consistent profitability over the analyzed period. The forecasted figures indicate optimism regarding future business prospects, although potential risks and uncertainties should be monitored closely to ensure continued financial sustainability.

2. CASH FLOW STATEMENT

Here's the Cash Flow Statement for Britannia Industries Limited presented in tabular form: (Figures in Crores)

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
Cash flows from operating activities
Profit before tax and share of profits / (loss) of associates and after exceptional item	1,843.86	2,512.80	2,078.53	3,027.36	2646.26	2685.74	2720.32	2756.75
Adjustments for
Depreciation and amortisation expense	184.81	197.85	200.54	225.91	296.42	343.84	396.26	446.90
Share based payment expense	21.58	18.94	4.78
Net gain on financial asset measured at fair value through Statement ofProfit and Loss	-89.88	-65.47	-28.91	-42.08
Profit on sale of property, plant and equipment	-0.11	-0.33	-0.95	-0.83
Net gain on financial asset measured at fair value through statement of profit and loss				-375.6
Interest income from financial assets carried at amortised cost	-176.77	-234.66	-184.6	-163.15
Bad debts				5.59
Finance costs	76.9	110.9	144.29	169.1
Changes in
Inventories	42.99	-351.44	-274.76	177.15	-325.81	243.62	-325.81	243.62
Trade receivables	78.85	61.4	-72.21	1.29	-65.41	43.49	-65.41	43.49
Loans receivable other financial assets. other bank balances and other assets	-23.66	-143.62	-44.29	-64.82
Accounts payables other financial liabilities other liabilities and provisions	29.21	401.96	64.01	292.04	85.94164384	4.469315068	85.94164384	4.469315068
Cash generated from operating activities	1,987.78	2,508.33	1,886.43	3,251.96	2,637.40	3,321.16	2,811.30	3,495.23
Income-tax paid. net of refund	-503.25	-632.81	-586.91	-725.75	-648.33	-671.43	-680.08	-689.19
Net cash generated from operating activities	1,484.53	1,875.52	1,299.52	2,526.21	1,989.07	2,649.72	2,131.22	2,806.04
Cash flow from investing activities
Acquisition of property. plant and equipment and other intangible assets	-244.17	-240.51	-550.18	-711.46	-825.00	-935.00	-1050.00	-1080.00
Consideration paid under business combination				-1.45
Proceeds from sale of property, plant and equipment	0.73	2.17	3.16	78.43	6.25	7.30	8.47	9.76
Purchase of investments net	-1,326.63	178.6	191.78	-400.82
Purchase of non current investment			-20.68	443.27
Sale of current investment,net			876.87	-1,067.32
Investment in subsidies				-214.91
Inter-corporate deposits placed	-1,293.41	-1,202.50	-740	-138.59
Derecognition of net assets				-850
Proceeds from sale of equity shares in subsidiary				261.8
Inter-corporate deposits redeemed	1,204.24	1491.41	941.5	938
Loans given to subsidiaries
Loans repaid by subsidiaries
Change in bank balance		-26.98	1.69	-28.69
Interest received	127.62	233.43	206.75	174.68
Net cash used in investing activities	-1,531.62	435.62	910.89	-1,517.06	-818.75	-927.70	-1,041.53	-1,070.24
Cash flow from financing activities			-
			-
Proceeds from share allotment	23.97	103.15	-1.55	-2.76
Principal payment of lease liabilities**	-2.03	-2.55		2.69
Interest paid on lease liabilities		-1.04	-0.65	-0.63
Interest paid	-35.99	-101.3	-118.61	-195.66
Net proceeds from other working capital borrowing		102.31
Issue of bonus debentures	720.95	-	698.52
Proceeds from (Repayment of) borrowings net*	640.72		645.35	299.4
Repayment of bonus debentures				-720.95
Proceeds from non-current borrowings				1010
Proceeds from issue of commercial paper		1431.08
Contribution from non-controlling interest	12	14	0	9.01
Repayment of commercial paper		-964.4	-966.29
REPAYMENT OF TERM loans			-17.73	-70.23
Dividends paid (including dividend distribution tax)	-432.53	-2,823.75	-2,484.88	-1359.24
Payment of bonus debentures (including dividend distribution tax)	-869.15	-	-
Net cash generated from / (used in) financing activities	57.94	-2242.5	-2,245.84	-1,028.37	0.00	0.00	0.00	0.00
Net change in cash and cash equivalents	10.85	68.64	-35.43	-19.22	1,170.32	1,722.02	1,089.69	1,735.80
Effect of exchange rate changes on cash and cash equivalents	5.69	-2.44	3.3	10.06
Cash and cash equivalents at beginning of the year (Net of book overdraft)	58.72	75.26	141.45	109.32	100.16	1,270.48	2,992.50	4,082.19
Cash and cash equivalents at end of the period (Net of bank overdraft)	75.26	141.45	109.32	100.16	1,270.48	2,992.50	4,082.19	5,817.99
bank overdraft	5.97	1.29	8.67	2.22	2.22	2.22	2.22	2.22
Cash and cash equivalents	81.23	142.74	117.99	102.38	1,272.70	2,994.72	4,084.41	5,820.21

 

ANALYSIS

Cash Flows from Operating Activities:

BIL has consistently generated positive cash flows from operating activities over the analyzed period.

The cash generated from operating activities has shown an increasing trend, indicating the company's ability to generate cash from its core business operations.

Adjustments made for non-cash items such as depreciation and amortization, share-based payment expense, and changes in working capital have been accounted for to arrive at the net cash generated from operating activities.

The forecasted cash flows from operating activities continue to show growth, reflecting anticipated improvements in profitability and efficient working capital management.

Cash Flows from Investing Activities:

BIL's cash flows from investing activities primarily involve capital expenditure, acquisitions, and investments in subsidiaries.

Significant cash outflows are observed in acquisitions of property, plant, and equipment, indicating investments in expanding or upgrading manufacturing facilities and infrastructure.

Cash outflows are also observed in investments in subsidiaries and inter-corporate deposits, reflecting strategic investments and financing activities.

The forecasted cash flows from investing activities show a mix of capital expenditure, proceeds from asset sales, and investments, reflecting continued investment in business growth and strategic initiatives.

Cash Flows from Financing Activities:

BIL's cash flows from financing activities involve activities related to raising and repaying funds, including borrowings, lease payments, and dividends.

Proceeds from share allotment, borrowings, and issue of commercial paper contribute to cash inflows, indicating capital raising activities.

Cash outflows are observed in repayment of borrowings, dividends paid, and repayment of lease liabilities, reflecting obligations to creditors and shareholders.

The forecasted cash flows from financing activities indicate a potential reduction in borrowings and dividend payments, which could be attributed to changes in capital structure or dividend policy.

Net Change in Cash and Cash Equivalents:

The net change in cash and cash equivalents represents the overall change in BIL's liquidity position during the period.

Positive net changes in cash and cash equivalents indicate an increase in liquidity, while negative changes indicate a decrease.

BIL has experienced varying levels of net changes in cash and cash equivalents over the analyzed period, influenced by operating, investing, and financing activities.

Cash and Cash Equivalents:

BIL's cash and cash equivalents represent the liquid assets available to the company for meeting short-term obligations and capitalizing on investment opportunities.

The forecasted cash and cash equivalents show a steady increase, reflecting anticipated improvements in liquidity position over the forecasted period.

Overall, the cash flow statement provides insights into BIL's ability to generate cash from its operations, manage investments, and fund its activities through financing sources. The analysis of cash flows helps stakeholders evaluate the company's financial health, liquidity position, and capital allocation strategies

3. BALANCE SHEET

Here's the Balance Sheet  for Britannia Industries Limited presented in tabular form:

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
ASSETS
NON CURRENT ASSETS
Property, plant and equipment	1716.37	1634.30	1584.05	2472.19	2919.64	3386.73	3902.95	4401.62
Capital work in process	39.55	116.52	535.68	105	109.49	127.00	146.36	165.06
Investment properties	14.47	14.21	13.95	40.63	36.50	42.33	48.79	55.02
Goodwill	138.97	135.90	139.61	128.16	128.16	128.16	128.16	128.16
Other intangible assets	8.37	8.54	15.6	14.24	36.50	42.33	48.79	55.02
Investment in associates and joint venture	1.48	2.29	2.09	495.16	547.43	635.01	731.80	825.30
Financial assets
Investments	1882.98	1385.37	926.55	1028.09	1028.09	1028.09	1028.09	1028.09
Loans receivable	202.95	58.00	100	150	150	150	150	150
Other financial assets	31.33	46.71	31.8	23.57	23.57	23.57	23.57	23.57
Deferred tax assets	19.56	9.66	51.67	57.25	57.25	57.25	57.25	57.25
Income tax assets	68.77	71.84	44.93	43.64	43.64	43.64	43.64	43.64
Other non current asstes	42.46	105.98	99.18	48.56	48.56	48.56	48.56	48.56
Total non current assets	4167.26	3589.32	3545.11	4606.49	5128.82	5712.68	6357.96	6981.30
Current assets
Inventories	740.96	1091.49	1367.49	1193.26	1519.068767	1275.451781	1601.260548	1357.643562
Financial assets
Investments	1008.77	1393.25	833.73	1800.99	1800.99	1800.99	1800.99	1800.99
Trade receivables	320.36	257.27	331.93	328.94	394.35	350.86	416.27	372.78
Cash and cash equivalents	81.23	142.74	117.99	102.38	1,272.70	2,994.72	4,084.41	5,820.21
Bank balance other than (iii)above	41.62	68.60	66.91	95.6	95.6	95.6	95.6	95.6
Loans receivable	1110.11	941.50	698	560	560	560	560	560
Other financials assets	229.75	402.82	428.03	451.96	451.96	451.96	451.96	451.96
other current assets	142.17	121.79	138.22	180.74	180.74	180.74	180.74	180.74
Assets held-for-sale				32.36	32.36	32.36	32.36	32.36
Total current assets	3674.97	4419.46	3982.3	4746.23	6307.77	7742.68	9223.59	10672.28
TOTAL ASSETS	7842.23	8008.78	7527.41	9352.72	11436.59	13455.36	15581.54	17653.58
Equity and liabilities
Equity
Equity share capital	24.05	24.09	24.09	24.09	24.09	24.09	24.09	24.09
Other equity	4378.78	3523.57	2534.01	3510.18	5508.11	7522.41	9562.65	11630.21
Equity attributable to equity holder of the parent	4402.83	3547.66	2558.1	3534.27	5532.20	7546.50	9586.74	11654.30
Non-controlling interest	35.65	36.34	27.5	30.23	30.23	30.23	30.23	30.23
Total equity	4438.48	3584	2585.6	3564.5	5562.43	7576.73	9616.97	11684.53
Liabilities
Non-current liabilities
Financial liabilities
(i) Borrowings	766.06	747.15	706.99	1551.8	1551.8	1551.8	1551.8	1551.8
(ii) Lease Liabilities		15.17	13.76	14.36	14.36	14.36	14.36	14.36
(iii) Other financial liabilities	46.54	44.87	52.64	60.15	60.15	60.15	60.15	60.15
Deferred tax liabilities (net)	12.69	8.69	0.81	1.87	1.87	1.87	1.87	1.87
Provisions			20.47	25.64	25.64	25.64	25.64	25.64
Total non-current liabilities	825.29	815.88	794.67	1653.82	1653.82	1653.82	1653.82	1653.82
Current liabilities
Financial liabilities
Borrowings	747.99	1357.15	1758.55	1428.71	1428.71	1428.71	1428.71	1428.71
Lease Liabilities		2.04	1.9	2.5	2.5	2.5	2.5	2.5
Trade payables
- Total outstanding dues of micro enterprises and small enterprises	8.53	26.40	62.76	43.92	61.39	61.57	65.01	65.19
- Total outstanding dues of creditors other than micro enterprises and small enterprises	1038.47	1286.79	1260.05	1404.89	1473.36	1477.65	1560.16	1564.45
Other financial liabilities	311.91	332.43	393.96	496.21	496.21	496.21	496.21	496.21
Other current liabilities	150.08	140.54	130.73	176.34	176.34	176.34	176.34	176.34
Provisions	273.7	387.47	464.64	513.39	513.39	513.39	513.39	513.39
Current tax liability	47.78	76.08	74.55	68.44	68.44	68.44	68.44	68.44
Total current liabilities	2578.46	3608.9	4147.14	4134.4	4220.34	4224.81	4310.75	4315.22
Total liabilities	3403.75	4424.78	4941.81	5788.22	5874.16	5878.63	5964.57	5969.04
Total equity and liabillities	7842.23	8008.78	7527.41	9352.72	11436.59	13455.36	15581.54	17653.58

 

ANALYSIS

To analyze the balance sheet of Britannia Industries Limited as part of financial modeling, we can perform various financial ratios and metrics calculations to assess the company's financial health, efficiency, and leverage. Here are some key analyses:

Liquidity Ratios:

 

Current Ratio = Current Assets / Current Liabilities

Quick Ratio = (Current Assets - Inventories) / Current Liabilities These ratios assess the company's ability to meet short-term obligations.

Solvency Ratios:

Debt-to-Equity Ratio = Total Debt / Total Equity

Debt Ratio = Total Debt / Total Assets These ratios evaluate the company's leverage and financial risk.

Profitability Ratios:

Gross Profit Margin = (Revenue - Cost of Goods Sold) / Revenue

Net Profit Margin = Net Income / Revenue These ratios measure the company's efficiency in generating profits.

Efficiency Ratios:

Asset Turnover Ratio = Revenue / Total Assets

Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory These ratios assess how efficiently the company utilizes its assets and manages inventory.

Return Ratios:

Return on Assets (ROA) = Net Income / Total Assets

Return on Equity (ROE) = Net Income / Total Equity These ratios indicate the company's profitability relative to its assets and equity.

Market Value Ratios:

Price-to-Earnings (P/E) Ratio = Market Price per Share / Earnings per Share

Price-to-Book (P/B) Ratio = Market Price per Share / Book Value per Share These ratios compare the company's stock price to its earnings and book value.

By calculating and analyzing these ratios over time, we can gain insights into Britannia Industries Limited's financial performance, efficiency, and overall health. Additionally, trend analysis can help identify patterns and potential areas for improvement or concern.

 

4. REVENUE SCHEDULE

Here's the Revenue Schedule for Britannia Industries Limited presented in tabular form:

PARTICULARS
	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
(1) Income
(a) Revenue from operations
(i) Revenue from sale of products	11443.99	12883.04	13994.67	15984.9	16500	17000	17500	18000
(ii) Other operating revenue	155.56	253.1	191.59	315.65
Total revenue from operations	11599.55	13136.14	14186.26	16300.55	16500	17000	17500	18000
(b) Other income	279.4	312.87	222.83	215.86
(2) Total income (a+b)	11878.95	13449.01	14409.09	16516.41	16500	17000	17500	18000

 

ANALYSIS

Revenue Analysis:

Analyze the trend in revenue from the sale of products and other operating revenue over the years. Look for consistent growth patterns or any irregularities.

Calculate the year-over-year growth rate for revenue from the sale of products and other operating revenue to assess the company's sales performance.

Other Income:

Evaluate the trend in other income over the years. Other income typically includes interest income, dividend income, etc.

Assess the contribution of other income to the company's total income and its stability over time.

Total Income:

Analyze the total income trend over the years and compare it with revenue growth. Ensure that the growth in total income is sustainable and driven by operational performance rather than one-time factors.

Gross Profit Margin:

Calculate the gross profit margin by dividing gross profit (revenue minus cost of goods sold) by revenue. Analyze the trend to see if the company is maintaining or improving its profitability.

Operating Expenses:

Break down operating expenses such as selling expenses, administrative expenses, and other operating expenses. Analyze the trend to identify areas of cost efficiency or potential cost escalation.

Net Profit Margin:

Calculate the net profit margin by dividing net income by revenue. Analyze the trend to assess the company's overall profitability after accounting for all expenses and taxes.

Earnings Per Share (EPS):

Calculate EPS by dividing net income attributable to common shareholders by the weighted average number of shares outstanding. Analyze the trend to understand the company's ability to generate earnings on a per-share basis.

Return on Investment (ROI):

Calculate ROI by dividing net income by total assets. Analyze the trend to assess how efficiently the company is utilizing its assets to generate profits.

Comparative Analysis:

Compare the income statement metrics with industry benchmarks and competitors to evaluate the company's performance relative to its peers.

By conducting a thorough analysis of these factors, we can gain insights into Britannia Industries Limited's financial performance, profitability, and efficiency, which are crucial for financial modeling and decision-making processes.

 

5. ASSET SCHEDULE

Here's the Asset Schedule for Britannia Industries Limited presented in tabular form:

PARTICULARS	PREVIOUS			CURRENT	Expected
	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
Opening Balance		1780.24	1775.86	2151.37	3127.22	3649.55	4233.41	4878.69
Additional		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
Disposal		-2.17	-3.16	-78.43	-6.25	-7.30	-8.47	-9.76
Depreciation		-197.85	-200.54	-225.91	-296.42	-343.84	-396.26	-446.90
Adjustment		-44.87	29.03	568.73
Closing Balance	1780.24	1775.86	2151.37	3127.22	3649.55	4233.41	4878.69	5502.03
Deprication as part of assets		19.58%	17.24%	15.78%	15.00%	15.00%	15.00%	15.00%
capex		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
capex as part of sales(%)		1.87%	3.95%	4.45%	5.00%	5.50%	6.00%	6.00%
Composition of Capex
Acquisition of property. plant and equipment and other intangible assets		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
Disposal as a % of opening balance		0.12%	0.18%	3.65%	0.20%	0.20%	0.20%	0.20%
composition of fixed asset(excluding goodwill)
Property, plant and equipment		1634.30	1584.05	2472.19	2919.64	3386.73	3902.95	4401.62
Capital work in process		116.52	535.68	105.00	109.49	127.00	146.36	165.06
Investment properties		14.21	13.95	40.63	36.50	42.33	48.79	55.02
Other intangible assets		8.54	15.60	14.24	36.50	42.33	48.79	55.02
Investment in associates and joint venture		2.29	2.09	495.16	547.43	635.01	731.80	825.30
Total		1775.86	2151.37	3127.22	3649.55	4233.41	4878.69	5502.03
composition of fixed asset in % (excluding goodwill)
Property, plant and equipment		92.03%	73.63%	79.05%	80%	80%	80%	80%
Capital work in process		6.56%	24.90%	3.36%	3%	3%	3%	3%
Investment properties		0.80%	0.65%	1.30%	1%	1%	1%	1%
Other intangible assets		0.48%	0.73%	0.46%	1%	1%	1%	1%
Investment in associates and joint venture		0.13%	0.10%	15.83%	15%	15%	15%	15%
Total		100.00%	100.00%	100.00%	100%	100%	100%	100%

 

ANALYSIS

Capital Expenditure (Capex) Analysis:

Evaluate the trend in capital expenditure over the years to understand the company's investment in property, plant, equipment, and other intangible assets.

Calculate capex as a percentage of sales to assess the proportion of revenue allocated to investments in fixed assets. Analyze if the capex percentage is consistent with industry standards or if it indicates any strategic shifts.

 

Composition of Capex:

Examine the composition of capex to identify the allocation of funds across different types of assets. This includes acquisitions of property, plant, equipment, and other intangible assets.

 

Depreciation Analysis:

Analyze the trend in depreciation expenses over the years and compare it with the opening and closing balances of fixed assets. Ensure that depreciation is accounted for accurately and consistently.

Evaluate the depreciation rate as a percentage of the carrying value of fixed assets to assess the rate at which assets are being depreciated. Consider whether the depreciation rate aligns with industry norms and the useful life of assets.

Disposal Analysis:

Examine the trend in disposal of assets as a percentage of the opening balance of fixed assets. Assess if there are any significant disposals and whether they are in line with the company's strategic objectives.

Composition of Fixed Assets:

Evaluate the composition of fixed assets, excluding goodwill, to understand the distribution of assets such as property, plant, equipment, investment properties, and other intangible assets.

Analyze the percentage composition of fixed assets to assess the company's asset allocation strategy and the relative importance of each asset category.

Overall Financial Impact:

Assess the overall financial impact of capital expenditure, depreciation, and disposals on the company's balance sheet, cash flow statement, and income statement.

Determine how these factors contribute to the company's growth, profitability, and long-term sustainability.

By conducting a comprehensive analysis of these factors, we can gain insights into the company's investment decisions, asset management practices, and financial performance, which are essential for financial modeling and strategic planning purposes.

 

6. WORKING CAPITAL

Here's the working capital for Britannia Industries Limited presented in tabular form:

 

CONSOLIDATED FINANCIALS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecasted	Forecasted	Forecasted	Forecasted
Inventory	740.96	1091.49	1367.49	1193.26	1519.07	1275.45	1601.26	1357.64
Average Inventory		916.23	1229.49	1280.38	1356.16	1397.26	1438.36	1479.45
Inventory Turnover Ratio(cost/avg.inv.)		8.32	7.13	7.49	7.3	7.3	7.3	7.3
Avg. Inventory Holding period(in Days) (365/ inv. Turn ratio)		44	51	49	50	50	50	50
Trade Payables	1047.00	1313.19	1322.81	1448.81	1534.75	1539.22	1625.16	1629.63
Average trade Payable		1180.10	1318.00	1385.81	1491.78	1536.99	1582.19	1627.40
Average trade Payable Period (in days) ((avg. trade payable/cost)*365)		56	55	53	55	55	55	55
Composition of Trade Payables
Trade Paybables Total outstanding dues of micro enterprise and small enterprise	8.53	26.4	62.76	43.92	61.39	61.57	65.01	65.19
Trade Paybables Total outstanding dues of creditors other than micro enterprises and small enterprises	1038.47	1286.79	1260.05	1404.89	1473.36	1477.65	1560.16	1564.45
Total	1047	1313.19	1322.81	1448.81	1534.75	1539.22	1625.16	1629.63
Composition of Trade Payables (%)
Trade Paybables Total outstanding dues of micro enterprise and small enterprise	0.81%	2.01%	4.74%	3.03%	4%	4%	4%	4%
Trade Paybables Total outstanding dues of creditors other than micro enterprises and small enterprises	99.19%	97.99%	95.26%	96.97%	96%	96%	96%	96%
Total	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%
Trade Recievables	320.36	257.27	331.93	328.94	394.35	350.86	416.27	372.78
Average trade recievable		288.815	294.6	330.435	361.64	372.60	383.56	394.52
Average trade receivable Payable Period (in days)		8	8	8	8	8	8	8

 

ANALYSIS

Inventory Management Analysis:

Calculate the inventory turnover ratio to assess how efficiently the company is managing its inventory. A higher turnover ratio generally indicates more efficient inventory management.

Evaluate the average inventory holding period in days to understand how long, on average, inventory is held before being sold. This helps in assessing inventory management efficiency and liquidity.

Trade Payables Analysis:

Analyze the average trade payable period to understand the average number of days it takes for the company to pay its suppliers. A shorter payable period may indicate strong bargaining power with suppliers or efficient cash management.

Examine the composition of trade payables to differentiate between outstanding dues of micro-enterprises/small enterprises and other creditors. This helps in understanding the company's relationships with different types of suppliers.

Trade Receivables Analysis:

Evaluate the average trade receivable period to understand the average number of days it takes for the company to collect payments from its customers. A shorter receivable period indicates faster conversion of sales into cash.

Assess the trend in trade receivables over time to identify any changes in the company's credit policies or the effectiveness of its receivables management practices.

Overall Financial Impact:

Consider the implications of inventory turnover, trade payables, and trade receivables on the company's working capital management, cash flow, and liquidity position.

Determine how these factors contribute to the company's overall financial performance, profitability, and risk management.

By analyzing these aspects as part of financial modeling, we can gain insights into the company's operational efficiency, liquidity, and effectiveness of its working capital management strategies. This analysis can inform decision-making processes and help in identifying areas for improvement or optimization.

 

7. COST SHEET

Here's the cost sheet for Britannia Industries Limited presented in tabular form:

 

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecasted	Forecasted	Forecasted	Forecasted
Adjusted purchase as a % of Revenue from operations	60.53%	59.19%	62.82%	60.00%	60%	60%	60%	60%
Adjusted purchase
(a) Cost of materials consumed	5684.98	6502.33	7473.97	8326.7	9999.36	10785.32	11414.27	11762.49
(b) Purchases of stock-in-trade	1189.92	1160.89	1361.59	1337.13	1881.00	1938.00	1995.00	2052.00
(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade	52.57	-37.12	-75.26	-72.53	-1980.36	-2523.32	-2909.27	-3014.49
Total adjusted purchase	6927.47	7626.1	8760.3	9591.3	9900.00	10200.00	10500.00	10800.00
Adjusted purchase (%)
(a) Cost of materials consumed	82.06%	93.86%	107.89%	120.20%	101%	106%	109%	109%
(b) Purchases of stock-in-trade	17.18%	16.76%	19.65%	19.30%	19%	19%	19%	19%
(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade	0.76%	-10.62%	-27.54%	-39.50%	-20%	-25%	-28%	-28%
	100.00%	100.00%	100.00%	100.00%	100%	100%	100%	100%
Employee Benefit expenses
d) Employee benefits expense	486.69	527.38	542.26	658.38	660.00	680.00	700.00	720.00
as a % of Total revenue from operations	4.20%	4.01%	3.84%	4.04%	4.00%	4.00%	4.00%	4.00%
Other Expenses
Other Expenses	2342.21	2473.37	2632.19	3219.96	3217.50	3315.00	3412.50	3510.00
as a % of Total revenue from operations	20.19%	18.83%	18.62%	19.75%	19.50%	19.50%	19.50%	19.50%
Tax Expenses as a % of Profit before tax	24.44%	26.38%	27.06%	23.62%	24.50%	25.00%	25.00%	25.00%
Tax Expenses
(a) Current tax	447.69	657.12	612.24	720.97	641.85	664.72	673.28	682.30
(b) Deferred tax	3.01	5.9	-49.89	-4.52	6.48	6.71	6.80	6.89
total tax	450.7	663.02	562.35	716.45	648.33	671.43	680.08	689.19
Tax Expenses(%)
(a) Current tax	99.33%	99.11%	108.87%	100.63%	99%	99%	99%	99%
(b) Deferred tax	0.67%	0.89%	-8.87%	-0.63%	1.00%	1.00%	1.00%	1.00%
total tax	100.00%	100.00%	100.00%	100.00%	100%	100%	100%	100%

 

ANALYSIS

Adjusted Purchase Analysis:

Adjusted purchases as a percentage of revenue from operations indicate the proportion of revenue spent on purchases. Consistent percentages over time suggest stable procurement practices.

Breakdown of adjusted purchases into cost of materials consumed, purchases of stock-in-trade, and changes in inventories helps understand the composition of purchases and inventory management efficiency.

Fluctuations in adjusted purchase percentages and components can highlight changes in procurement strategies, pricing dynamics, or inventory management effectiveness.

Employee Benefit Expenses Analysis:

Employee benefit expenses as a percentage of total revenue from operations indicate the portion of revenue allocated to employee compensation and benefits. Consistent percentages suggest stable labor cost management.

Monitoring changes in this percentage over time helps assess the company's commitment to its workforce and its ability to maintain a competitive cost structure.

Other Expenses Analysis:

Other expenses as a percentage of total revenue from operations represent the share of revenue used to cover operating costs other than materials and labor. Consistent percentages indicate stable expense management.

Analyzing changes in other expenses over time helps identify trends in cost structures, operational efficiency, and potential areas for cost optimization.

Tax Expenses Analysis:

Tax expenses as a percentage of profit before tax indicate the effective tax rate applied to the company's profits. Consistent percentages suggest stable tax planning and compliance practices.

Breakdown of tax expenses into current tax and deferred tax helps understand the components of the tax burden and any tax planning strategies employed.

Analyzing changes in tax expenses percentages and components over time helps assess the company's tax efficiency, compliance, and potential impacts on cash flows and profitability.

By conducting this analysis as part of financial modeling, stakeholders can gain insights into the company's cost structures, operational efficiency, tax management, and overall financial health. This information can inform decision-making processes and strategic planning initiatives.

 

ANALYSIS

 

Revenue Trends:

BIL's revenue from operations has shown consistent growth from 2020 to the forecasted period of 2027. This growth indicates the company's ability to increase sales over time, which is a positive indicator of business performance and market demand.

The forecasted revenue continues to grow steadily, reaching ?18,000 crores by 2027, demonstrating optimism regarding future business prospects.

Expense Management:

Cost of materials consumed and purchases of stock in trade have increased steadily over the years, indicating rising input costs or increased production volumes.

Notably, changes in inventories show fluctuation, with negative values in some years, suggesting potential inventory management challenges.

Other expenses have also increased, reflecting growing operational costs, which could include marketing expenses, administrative costs, and other overheads.

Despite increasing expenses, BIL has maintained profitability, as indicated by the consistent growth in profit before tax.

Profitability:

 BIL's profitability has been robust, with profits consistently increasing over the years.

The company has demonstrated resilience even in challenging periods, as seen in the increase in profit before tax in 2023 despite exceptional items.

However, there is a slight decrease in profit in the forecasted period of 2024, which may warrant further investigation into potential factors affecting profitability.

Comprehensive Income and Equity:

BIL's total comprehensive income has shown a positive trend, indicating the company's ability to generate profits and manage other comprehensive income components effectively.

The paid-up equity share capital remains constant, suggesting no significant dilution or issuance of new equity shares during the period.

The debt equity ratio, debt service coverage ratio, and interest service coverage ratio would provide insights into BIL's financial leverage and ability to meet its debt obligations, which are essential metrics for evaluating financial health. However, these ratios are not provided in the income statement.

Earnings Per Share (EPS):

 

BIL's EPS has shown consistent growth over the years, reflecting the company's ability to generate profits on a per-share basis.

This growth in EPS indicates enhanced shareholder value and potential attractiveness to investors.

Forecast and Future Outlook:

The forecasted revenue and profitability reflect management's expectations for future growth and financial performance.

However, it's essential to consider external factors such as market conditions, regulatory changes, and competitive pressures that could impact actual results.

In conclusion, Britannia Industries Limited has demonstrated strong revenue growth, effective expense management, and consistent profitability over the analyzed period. The forecasted figures indicate optimism regarding future business prospects, although potential risks and uncertainties should be monitored closely to ensure continued financial sustainability.

2. CASH FLOW STATEMENT

Here's the Cash Flow Statement for Britannia Industries Limited presented in tabular form: (Figures in Crores)

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
Cash flows from operating activities
Profit before tax and share of profits / (loss) of associates and after exceptional item	1,843.86	2,512.80	2,078.53	3,027.36	2646.26	2685.74	2720.32	2756.75
Adjustments for
Depreciation and amortisation expense	184.81	197.85	200.54	225.91	296.42	343.84	396.26	446.90
Share based payment expense	21.58	18.94	4.78
Net gain on financial asset measured at fair value through Statement ofProfit and Loss	-89.88	-65.47	-28.91	-42.08
Profit on sale of property, plant and equipment	-0.11	-0.33	-0.95	-0.83
Net gain on financial asset measured at fair value through statement of profit and loss				-375.6
Interest income from financial assets carried at amortised cost	-176.77	-234.66	-184.6	-163.15
Bad debts				5.59
Finance costs	76.9	110.9	144.29	169.1
Changes in
Inventories	42.99	-351.44	-274.76	177.15	-325.81	243.62	-325.81	243.62
Trade receivables	78.85	61.4	-72.21	1.29	-65.41	43.49	-65.41	43.49
Loans receivable other financial assets. other bank balances and other assets	-23.66	-143.62	-44.29	-64.82
Accounts payables other financial liabilities other liabilities and provisions	29.21	401.96	64.01	292.04	85.94164384	4.469315068	85.94164384	4.469315068
Cash generated from operating activities	1,987.78	2,508.33	1,886.43	3,251.96	2,637.40	3,321.16	2,811.30	3,495.23
Income-tax paid. net of refund	-503.25	-632.81	-586.91	-725.75	-648.33	-671.43	-680.08	-689.19
Net cash generated from operating activities	1,484.53	1,875.52	1,299.52	2,526.21	1,989.07	2,649.72	2,131.22	2,806.04
Cash flow from investing activities
Acquisition of property. plant and equipment and other intangible assets	-244.17	-240.51	-550.18	-711.46	-825.00	-935.00	-1050.00	-1080.00
Consideration paid under business combination				-1.45
Proceeds from sale of property, plant and equipment	0.73	2.17	3.16	78.43	6.25	7.30	8.47	9.76
Purchase of investments net	-1,326.63	178.6	191.78	-400.82
Purchase of non current investment			-20.68	443.27
Sale of current investment,net			876.87	-1,067.32
Investment in subsidies				-214.91
Inter-corporate deposits placed	-1,293.41	-1,202.50	-740	-138.59
Derecognition of net assets				-850
Proceeds from sale of equity shares in subsidiary				261.8
Inter-corporate deposits redeemed	1,204.24	1491.41	941.5	938
Loans given to subsidiaries
Loans repaid by subsidiaries
Change in bank balance		-26.98	1.69	-28.69
Interest received	127.62	233.43	206.75	174.68
Net cash used in investing activities	-1,531.62	435.62	910.89	-1,517.06	-818.75	-927.70	-1,041.53	-1,070.24
Cash flow from financing activities			-
			-
Proceeds from share allotment	23.97	103.15	-1.55	-2.76
Principal payment of lease liabilities**	-2.03	-2.55		2.69
Interest paid on lease liabilities		-1.04	-0.65	-0.63
Interest paid	-35.99	-101.3	-118.61	-195.66
Net proceeds from other working capital borrowing		102.31
Issue of bonus debentures	720.95	-	698.52
Proceeds from (Repayment of) borrowings net*	640.72		645.35	299.4
Repayment of bonus debentures				-720.95
Proceeds from non-current borrowings				1010
Proceeds from issue of commercial paper		1431.08
Contribution from non-controlling interest	12	14	0	9.01
Repayment of commercial paper		-964.4	-966.29
REPAYMENT OF TERM loans			-17.73	-70.23
Dividends paid (including dividend distribution tax)	-432.53	-2,823.75	-2,484.88	-1359.24
Payment of bonus debentures (including dividend distribution tax)	-869.15	-	-
Net cash generated from / (used in) financing activities	57.94	-2242.5	-2,245.84	-1,028.37	0.00	0.00	0.00	0.00
Net change in cash and cash equivalents	10.85	68.64	-35.43	-19.22	1,170.32	1,722.02	1,089.69	1,735.80
Effect of exchange rate changes on cash and cash equivalents	5.69	-2.44	3.3	10.06
Cash and cash equivalents at beginning of the year (Net of book overdraft)	58.72	75.26	141.45	109.32	100.16	1,270.48	2,992.50	4,082.19
Cash and cash equivalents at end of the period (Net of bank overdraft)	75.26	141.45	109.32	100.16	1,270.48	2,992.50	4,082.19	5,817.99
bank overdraft	5.97	1.29	8.67	2.22	2.22	2.22	2.22	2.22
Cash and cash equivalents	81.23	142.74	117.99	102.38	1,272.70	2,994.72	4,084.41	5,820.21

 

ANALYSIS

Cash Flows from Operating Activities:

BIL has consistently generated positive cash flows from operating activities over the analyzed period.

The cash generated from operating activities has shown an increasing trend, indicating the company's ability to generate cash from its core business operations.

Adjustments made for non-cash items such as depreciation and amortization, share-based payment expense, and changes in working capital have been accounted for to arrive at the net cash generated from operating activities.

The forecasted cash flows from operating activities continue to show growth, reflecting anticipated improvements in profitability and efficient working capital management.

Cash Flows from Investing Activities:

BIL's cash flows from investing activities primarily involve capital expenditure, acquisitions, and investments in subsidiaries.

Significant cash outflows are observed in acquisitions of property, plant, and equipment, indicating investments in expanding or upgrading manufacturing facilities and infrastructure.

Cash outflows are also observed in investments in subsidiaries and inter-corporate deposits, reflecting strategic investments and financing activities.

The forecasted cash flows from investing activities show a mix of capital expenditure, proceeds from asset sales, and investments, reflecting continued investment in business growth and strategic initiatives.

Cash Flows from Financing Activities:

BIL's cash flows from financing activities involve activities related to raising and repaying funds, including borrowings, lease payments, and dividends.

Proceeds from share allotment, borrowings, and issue of commercial paper contribute to cash inflows, indicating capital raising activities.

Cash outflows are observed in repayment of borrowings, dividends paid, and repayment of lease liabilities, reflecting obligations to creditors and shareholders.

The forecasted cash flows from financing activities indicate a potential reduction in borrowings and dividend payments, which could be attributed to changes in capital structure or dividend policy.

Net Change in Cash and Cash Equivalents:

The net change in cash and cash equivalents represents the overall change in BIL's liquidity position during the period.

Positive net changes in cash and cash equivalents indicate an increase in liquidity, while negative changes indicate a decrease.

BIL has experienced varying levels of net changes in cash and cash equivalents over the analyzed period, influenced by operating, investing, and financing activities.

Cash and Cash Equivalents:

BIL's cash and cash equivalents represent the liquid assets available to the company for meeting short-term obligations and capitalizing on investment opportunities.

The forecasted cash and cash equivalents show a steady increase, reflecting anticipated improvements in liquidity position over the forecasted period.

Overall, the cash flow statement provides insights into BIL's ability to generate cash from its operations, manage investments, and fund its activities through financing sources. The analysis of cash flows helps stakeholders evaluate the company's financial health, liquidity position, and capital allocation strategies

3. BALANCE SHEET

Here's the Balance Sheet  for Britannia Industries Limited presented in tabular form:

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
ASSETS
NON CURRENT ASSETS
Property, plant and equipment	1716.37	1634.30	1584.05	2472.19	2919.64	3386.73	3902.95	4401.62
Capital work in process	39.55	116.52	535.68	105	109.49	127.00	146.36	165.06
Investment properties	14.47	14.21	13.95	40.63	36.50	42.33	48.79	55.02
Goodwill	138.97	135.90	139.61	128.16	128.16	128.16	128.16	128.16
Other intangible assets	8.37	8.54	15.6	14.24	36.50	42.33	48.79	55.02
Investment in associates and joint venture	1.48	2.29	2.09	495.16	547.43	635.01	731.80	825.30
Financial assets
Investments	1882.98	1385.37	926.55	1028.09	1028.09	1028.09	1028.09	1028.09
Loans receivable	202.95	58.00	100	150	150	150	150	150
Other financial assets	31.33	46.71	31.8	23.57	23.57	23.57	23.57	23.57
Deferred tax assets	19.56	9.66	51.67	57.25	57.25	57.25	57.25	57.25
Income tax assets	68.77	71.84	44.93	43.64	43.64	43.64	43.64	43.64
Other non current asstes	42.46	105.98	99.18	48.56	48.56	48.56	48.56	48.56
Total non current assets	4167.26	3589.32	3545.11	4606.49	5128.82	5712.68	6357.96	6981.30
Current assets
Inventories	740.96	1091.49	1367.49	1193.26	1519.068767	1275.451781	1601.260548	1357.643562
Financial assets
Investments	1008.77	1393.25	833.73	1800.99	1800.99	1800.99	1800.99	1800.99
Trade receivables	320.36	257.27	331.93	328.94	394.35	350.86	416.27	372.78
Cash and cash equivalents	81.23	142.74	117.99	102.38	1,272.70	2,994.72	4,084.41	5,820.21
Bank balance other than (iii)above	41.62	68.60	66.91	95.6	95.6	95.6	95.6	95.6
Loans receivable	1110.11	941.50	698	560	560	560	560	560
Other financials assets	229.75	402.82	428.03	451.96	451.96	451.96	451.96	451.96
other current assets	142.17	121.79	138.22	180.74	180.74	180.74	180.74	180.74
Assets held-for-sale				32.36	32.36	32.36	32.36	32.36
Total current assets	3674.97	4419.46	3982.3	4746.23	6307.77	7742.68	9223.59	10672.28
TOTAL ASSETS	7842.23	8008.78	7527.41	9352.72	11436.59	13455.36	15581.54	17653.58
Equity and liabilities
Equity
Equity share capital	24.05	24.09	24.09	24.09	24.09	24.09	24.09	24.09
Other equity	4378.78	3523.57	2534.01	3510.18	5508.11	7522.41	9562.65	11630.21
Equity attributable to equity holder of the parent	4402.83	3547.66	2558.1	3534.27	5532.20	7546.50	9586.74	11654.30
Non-controlling interest	35.65	36.34	27.5	30.23	30.23	30.23	30.23	30.23
Total equity	4438.48	3584	2585.6	3564.5	5562.43	7576.73	9616.97	11684.53
Liabilities
Non-current liabilities
Financial liabilities
(i) Borrowings	766.06	747.15	706.99	1551.8	1551.8	1551.8	1551.8	1551.8
(ii) Lease Liabilities		15.17	13.76	14.36	14.36	14.36	14.36	14.36
(iii) Other financial liabilities	46.54	44.87	52.64	60.15	60.15	60.15	60.15	60.15
Deferred tax liabilities (net)	12.69	8.69	0.81	1.87	1.87	1.87	1.87	1.87
Provisions			20.47	25.64	25.64	25.64	25.64	25.64
Total non-current liabilities	825.29	815.88	794.67	1653.82	1653.82	1653.82	1653.82	1653.82
Current liabilities
Financial liabilities
Borrowings	747.99	1357.15	1758.55	1428.71	1428.71	1428.71	1428.71	1428.71
Lease Liabilities		2.04	1.9	2.5	2.5	2.5	2.5	2.5
Trade payables
- Total outstanding dues of micro enterprises and small enterprises	8.53	26.40	62.76	43.92	61.39	61.57	65.01	65.19
- Total outstanding dues of creditors other than micro enterprises and small enterprises	1038.47	1286.79	1260.05	1404.89	1473.36	1477.65	1560.16	1564.45
Other financial liabilities	311.91	332.43	393.96	496.21	496.21	496.21	496.21	496.21
Other current liabilities	150.08	140.54	130.73	176.34	176.34	176.34	176.34	176.34
Provisions	273.7	387.47	464.64	513.39	513.39	513.39	513.39	513.39
Current tax liability	47.78	76.08	74.55	68.44	68.44	68.44	68.44	68.44
Total current liabilities	2578.46	3608.9	4147.14	4134.4	4220.34	4224.81	4310.75	4315.22
Total liabilities	3403.75	4424.78	4941.81	5788.22	5874.16	5878.63	5964.57	5969.04
Total equity and liabillities	7842.23	8008.78	7527.41	9352.72	11436.59	13455.36	15581.54	17653.58

 

ANALYSIS

To analyze the balance sheet of Britannia Industries Limited as part of financial modeling, we can perform various financial ratios and metrics calculations to assess the company's financial health, efficiency, and leverage. Here are some key analyses:

Liquidity Ratios:

 

Current Ratio = Current Assets / Current Liabilities

Quick Ratio = (Current Assets - Inventories) / Current Liabilities These ratios assess the company's ability to meet short-term obligations.

Solvency Ratios:

Debt-to-Equity Ratio = Total Debt / Total Equity

Debt Ratio = Total Debt / Total Assets These ratios evaluate the company's leverage and financial risk.

Profitability Ratios:

Gross Profit Margin = (Revenue - Cost of Goods Sold) / Revenue

Net Profit Margin = Net Income / Revenue These ratios measure the company's efficiency in generating profits.

Efficiency Ratios:

Asset Turnover Ratio = Revenue / Total Assets

Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory These ratios assess how efficiently the company utilizes its assets and manages inventory.

Return Ratios:

Return on Assets (ROA) = Net Income / Total Assets

Return on Equity (ROE) = Net Income / Total Equity These ratios indicate the company's profitability relative to its assets and equity.

Market Value Ratios:

Price-to-Earnings (P/E) Ratio = Market Price per Share / Earnings per Share

Price-to-Book (P/B) Ratio = Market Price per Share / Book Value per Share These ratios compare the company's stock price to its earnings and book value.

By calculating and analyzing these ratios over time, we can gain insights into Britannia Industries Limited's financial performance, efficiency, and overall health. Additionally, trend analysis can help identify patterns and potential areas for improvement or concern.

 

4. REVENUE SCHEDULE

Here's the Revenue Schedule for Britannia Industries Limited presented in tabular form:

PARTICULARS
	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
(1) Income
(a) Revenue from operations
(i) Revenue from sale of products	11443.99	12883.04	13994.67	15984.9	16500	17000	17500	18000
(ii) Other operating revenue	155.56	253.1	191.59	315.65
Total revenue from operations	11599.55	13136.14	14186.26	16300.55	16500	17000	17500	18000
(b) Other income	279.4	312.87	222.83	215.86
(2) Total income (a+b)	11878.95	13449.01	14409.09	16516.41	16500	17000	17500	18000

 

ANALYSIS

Revenue Analysis:

Analyze the trend in revenue from the sale of products and other operating revenue over the years. Look for consistent growth patterns or any irregularities.

Calculate the year-over-year growth rate for revenue from the sale of products and other operating revenue to assess the company's sales performance.

Other Income:

Evaluate the trend in other income over the years. Other income typically includes interest income, dividend income, etc.

Assess the contribution of other income to the company's total income and its stability over time.

Total Income:

Analyze the total income trend over the years and compare it with revenue growth. Ensure that the growth in total income is sustainable and driven by operational performance rather than one-time factors.

Gross Profit Margin:

Calculate the gross profit margin by dividing gross profit (revenue minus cost of goods sold) by revenue. Analyze the trend to see if the company is maintaining or improving its profitability.

Operating Expenses:

Break down operating expenses such as selling expenses, administrative expenses, and other operating expenses. Analyze the trend to identify areas of cost efficiency or potential cost escalation.

Net Profit Margin:

Calculate the net profit margin by dividing net income by revenue. Analyze the trend to assess the company's overall profitability after accounting for all expenses and taxes.

Earnings Per Share (EPS):

Calculate EPS by dividing net income attributable to common shareholders by the weighted average number of shares outstanding. Analyze the trend to understand the company's ability to generate earnings on a per-share basis.

Return on Investment (ROI):

Calculate ROI by dividing net income by total assets. Analyze the trend to assess how efficiently the company is utilizing its assets to generate profits.

Comparative Analysis:

Compare the income statement metrics with industry benchmarks and competitors to evaluate the company's performance relative to its peers.

By conducting a thorough analysis of these factors, we can gain insights into Britannia Industries Limited's financial performance, profitability, and efficiency, which are crucial for financial modeling and decision-making processes.

 

5. ASSET SCHEDULE

Here's the Asset Schedule for Britannia Industries Limited presented in tabular form:

PARTICULARS	PREVIOUS			CURRENT	Expected
	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecast	Forecast	Forecast	Forecast
Opening Balance		1780.24	1775.86	2151.37	3127.22	3649.55	4233.41	4878.69
Additional		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
Disposal		-2.17	-3.16	-78.43	-6.25	-7.30	-8.47	-9.76
Depreciation		-197.85	-200.54	-225.91	-296.42	-343.84	-396.26	-446.90
Adjustment		-44.87	29.03	568.73
Closing Balance	1780.24	1775.86	2151.37	3127.22	3649.55	4233.41	4878.69	5502.03
Deprication as part of assets		19.58%	17.24%	15.78%	15.00%	15.00%	15.00%	15.00%
capex		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
capex as part of sales(%)		1.87%	3.95%	4.45%	5.00%	5.50%	6.00%	6.00%
Composition of Capex
Acquisition of property. plant and equipment and other intangible assets		240.51	550.18	711.46	825.00	935.00	1050.00	1080.00
Disposal as a % of opening balance		0.12%	0.18%	3.65%	0.20%	0.20%	0.20%	0.20%
composition of fixed asset(excluding goodwill)
Property, plant and equipment		1634.30	1584.05	2472.19	2919.64	3386.73	3902.95	4401.62
Capital work in process		116.52	535.68	105.00	109.49	127.00	146.36	165.06
Investment properties		14.21	13.95	40.63	36.50	42.33	48.79	55.02
Other intangible assets		8.54	15.60	14.24	36.50	42.33	48.79	55.02
Investment in associates and joint venture		2.29	2.09	495.16	547.43	635.01	731.80	825.30
Total		1775.86	2151.37	3127.22	3649.55	4233.41	4878.69	5502.03
composition of fixed asset in % (excluding goodwill)
Property, plant and equipment		92.03%	73.63%	79.05%	80%	80%	80%	80%
Capital work in process		6.56%	24.90%	3.36%	3%	3%	3%	3%
Investment properties		0.80%	0.65%	1.30%	1%	1%	1%	1%
Other intangible assets		0.48%	0.73%	0.46%	1%	1%	1%	1%
Investment in associates and joint venture		0.13%	0.10%	15.83%	15%	15%	15%	15%
Total		100.00%	100.00%	100.00%	100%	100%	100%	100%

 

ANALYSIS

Capital Expenditure (Capex) Analysis:

Evaluate the trend in capital expenditure over the years to understand the company's investment in property, plant, equipment, and other intangible assets.

Calculate capex as a percentage of sales to assess the proportion of revenue allocated to investments in fixed assets. Analyze if the capex percentage is consistent with industry standards or if it indicates any strategic shifts.

 

Composition of Capex:

Examine the composition of capex to identify the allocation of funds across different types of assets. This includes acquisitions of property, plant, equipment, and other intangible assets.

 

Depreciation Analysis:

Analyze the trend in depreciation expenses over the years and compare it with the opening and closing balances of fixed assets. Ensure that depreciation is accounted for accurately and consistently.

Evaluate the depreciation rate as a percentage of the carrying value of fixed assets to assess the rate at which assets are being depreciated. Consider whether the depreciation rate aligns with industry norms and the useful life of assets.

Disposal Analysis:

Examine the trend in disposal of assets as a percentage of the opening balance of fixed assets. Assess if there are any significant disposals and whether they are in line with the company's strategic objectives.

Composition of Fixed Assets:

Evaluate the composition of fixed assets, excluding goodwill, to understand the distribution of assets such as property, plant, equipment, investment properties, and other intangible assets.

Analyze the percentage composition of fixed assets to assess the company's asset allocation strategy and the relative importance of each asset category.

Overall Financial Impact:

Assess the overall financial impact of capital expenditure, depreciation, and disposals on the company's balance sheet, cash flow statement, and income statement.

Determine how these factors contribute to the company's growth, profitability, and long-term sustainability.

By conducting a comprehensive analysis of these factors, we can gain insights into the company's investment decisions, asset management practices, and financial performance, which are essential for financial modeling and strategic planning purposes.

 

6. WORKING CAPITAL

Here's the working capital for Britannia Industries Limited presented in tabular form:

 

CONSOLIDATED FINANCIALS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecasted	Forecasted	Forecasted	Forecasted
Inventory	740.96	1091.49	1367.49	1193.26	1519.07	1275.45	1601.26	1357.64
Average Inventory		916.23	1229.49	1280.38	1356.16	1397.26	1438.36	1479.45
Inventory Turnover Ratio(cost/avg.inv.)		8.32	7.13	7.49	7.3	7.3	7.3	7.3
Avg. Inventory Holding period(in Days) (365/ inv. Turn ratio)		44	51	49	50	50	50	50
Trade Payables	1047.00	1313.19	1322.81	1448.81	1534.75	1539.22	1625.16	1629.63
Average trade Payable		1180.10	1318.00	1385.81	1491.78	1536.99	1582.19	1627.40
Average trade Payable Period (in days) ((avg. trade payable/cost)*365)		56	55	53	55	55	55	55
Composition of Trade Payables
Trade Paybables Total outstanding dues of micro enterprise and small enterprise	8.53	26.4	62.76	43.92	61.39	61.57	65.01	65.19
Trade Paybables Total outstanding dues of creditors other than micro enterprises and small enterprises	1038.47	1286.79	1260.05	1404.89	1473.36	1477.65	1560.16	1564.45
Total	1047	1313.19	1322.81	1448.81	1534.75	1539.22	1625.16	1629.63
Composition of Trade Payables (%)
Trade Paybables Total outstanding dues of micro enterprise and small enterprise	0.81%	2.01%	4.74%	3.03%	4%	4%	4%	4%
Trade Paybables Total outstanding dues of creditors other than micro enterprises and small enterprises	99.19%	97.99%	95.26%	96.97%	96%	96%	96%	96%
Total	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%	100.00%
Trade Recievables	320.36	257.27	331.93	328.94	394.35	350.86	416.27	372.78
Average trade recievable		288.815	294.6	330.435	361.64	372.60	383.56	394.52
Average trade receivable Payable Period (in days)		8	8	8	8	8	8	8

 

ANALYSIS

Inventory Management Analysis:

Calculate the inventory turnover ratio to assess how efficiently the company is managing its inventory. A higher turnover ratio generally indicates more efficient inventory management.

Evaluate the average inventory holding period in days to understand how long, on average, inventory is held before being sold. This helps in assessing inventory management efficiency and liquidity.

Trade Payables Analysis:

Analyze the average trade payable period to understand the average number of days it takes for the company to pay its suppliers. A shorter payable period may indicate strong bargaining power with suppliers or efficient cash management.

Examine the composition of trade payables to differentiate between outstanding dues of micro-enterprises/small enterprises and other creditors. This helps in understanding the company's relationships with different types of suppliers.

Trade Receivables Analysis:

Evaluate the average trade receivable period to understand the average number of days it takes for the company to collect payments from its customers. A shorter receivable period indicates faster conversion of sales into cash.

Assess the trend in trade receivables over time to identify any changes in the company's credit policies or the effectiveness of its receivables management practices.

Overall Financial Impact:

Consider the implications of inventory turnover, trade payables, and trade receivables on the company's working capital management, cash flow, and liquidity position.

Determine how these factors contribute to the company's overall financial performance, profitability, and risk management.

By analyzing these aspects as part of financial modeling, we can gain insights into the company's operational efficiency, liquidity, and effectiveness of its working capital management strategies. This analysis can inform decision-making processes and help in identifying areas for improvement or optimization.

 

7. COST SHEET

Here's the cost sheet for Britannia Industries Limited presented in tabular form:

 

PARTICULARS	2020	2021	2022	2023	2024	2025	2026	2027
	Actual	Actual	Actual	Actual	Forecasted	Forecasted	Forecasted	Forecasted
Adjusted purchase as a % of Revenue from operations	60.53%	59.19%	62.82%	60.00%	60%	60%	60%	60%
Adjusted purchase
(a) Cost of materials consumed	5684.98	6502.33	7473.97	8326.7	9999.36	10785.32	11414.27	11762.49
(b) Purchases of stock-in-trade	1189.92	1160.89	1361.59	1337.13	1881.00	1938.00	1995.00	2052.00
(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade	52.57	-37.12	-75.26	-72.53	-1980.36	-2523.32	-2909.27	-3014.49
Total adjusted purchase	6927.47	7626.1	8760.3	9591.3	9900.00	10200.00	10500.00	10800.00
Adjusted purchase (%)
(a) Cost of materials consumed	82.06%	93.86%	107.89%	120.20%	101%	106%	109%	109%
(b) Purchases of stock-in-trade	17.18%	16.76%	19.65%	19.30%	19%	19%	19%	19%
(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade	0.76%	-10.62%	-27.54%	-39.50%	-20%	-25%	-28%	-28%
	100.00%	100.00%	100.00%	100.00%	100%	100%	100%	100%
Employee Benefit expenses
d) Employee benefits expense	486.69	527.38	542.26	658.38	660.00	680.00	700.00	720.00
as a % of Total revenue from operations	4.20%	4.01%	3.84%	4.04%	4.00%	4.00%	4.00%	4.00%
Other Expenses
Other Expenses	2342.21	2473.37	2632.19	3219.96	3217.50	3315.00	3412.50	3510.00
as a % of Total revenue from operations	20.19%	18.83%	18.62%	19.75%	19.50%	19.50%	19.50%	19.50%
Tax Expenses as a % of Profit before tax	24.44%	26.38%	27.06%	23.62%	24.50%	25.00%	25.00%	25.00%
Tax Expenses
(a) Current tax	447.69	657.12	612.24	720.97	641.85	664.72	673.28	682.30
(b) Deferred tax	3.01	5.9	-49.89	-4.52	6.48	6.71	6.80	6.89
total tax	450.7	663.02	562.35	716.45	648.33	671.43	680.08	689.19
Tax Expenses(%)
(a) Current tax	99.33%	99.11%	108.87%	100.63%	99%	99%	99%	99%
(b) Deferred tax	0.67%	0.89%	-8.87%	-0.63%	1.00%	1.00%	1.00%	1.00%
total tax	100.00%	100.00%	100.00%	100.00%	100%	100%	100%	100%

 

ANALYSIS

Adjusted Purchase Analysis:

Adjusted purchases as a percentage of revenue from operations indicate the proportion of revenue spent on purchases. Consistent percentages over time suggest stable procurement practices.

Breakdown of adjusted purchases into cost of materials consumed, purchases of stock-in-trade, and changes in inventories helps understand the composition of purchases and inventory management efficiency.

Fluctuations in adjusted purchase percentages and components can highlight changes in procurement strategies, pricing dynamics, or inventory management effectiveness.

Employee Benefit Expenses Analysis:

Employee benefit expenses as a percentage of total revenue from operations indicate the portion of revenue allocated to employee compensation and benefits. Consistent percentages suggest stable labor cost management.

Monitoring changes in this percentage over time helps assess the company's commitment to its workforce and its ability to maintain a competitive cost structure.

Other Expenses Analysis:

Other expenses as a percentage of total revenue from operations represent the share of revenue used to cover operating costs other than materials and labor. Consistent percentages indicate stable expense management.

Analyzing changes in other expenses over time helps identify trends in cost structures, operational efficiency, and potential areas for cost optimization.

Tax Expenses Analysis:

Tax expenses as a percentage of profit before tax indicate the effective tax rate applied to the company's profits. Consistent percentages suggest stable tax planning and compliance practices.

Breakdown of tax expenses into current tax and deferred tax helps understand the components of the tax burden and any tax planning strategies employed.

Analyzing changes in tax expenses percentages and components over time helps assess the company's tax efficiency, compliance, and potential impacts on cash flows and profitability.

By conducting this analysis as part of financial modeling, stakeholders can gain insights into the company's cost structures, operational efficiency, tax management, and overall financial health. This information can inform decision-making processes and strategic planning initiatives.

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Article Compiled by:-

Himanshu  Goel

(LegalMantra.net Team)

Disclaimer: Every effort has been made to avoid errors or omissions in this material in spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition In no event the author shall be liable for any direct indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information Many sources have been considered including Newspapers, Journals, Bare Acts, Case Materials , Charted Secretary, Research Papers etc.

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