RATING

RECOMMENDATION

Neutral

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  • Available in Depository:

  • NSDL

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  • Available for Investment:

  • Primary

  • Secondary

RATING

RECOMMENDATION

Neutral

Business Type

Dominant Leader

RATING

RECOMMENDATION

Neutral

Business Type

Dominant Leader

  • GKN Driveline Growth

GKN Driveline Revenue Growth

Growth in %

  • -27.53%

    1 Year

  • -14.39%

    3 Year

  • -7.30%

    5 Year

The company's top line has witnessed a fall of 29% in FY21 from FY20, mostly owing to decrease in the sales of goods by 29%. This was mainly due to lower market demand on account of COVID 19 lockdown in FY21. On the other hand, export sales remained the same with negligible decline of 2%. It must be noted that even with COVID-19 aftermath, the company is confident at getting new businesses from existing customer and potential customers in coming years. 

GKN Driveline Net Profit Growth(PAT)

Growth in %

  • -10.63%

    1 Year

  • -10.46%

    3 Year

  • 5.48%

    5 Year

The company has performed fairly well in terms of managing its expenses in accordance with the revenue. Revenue fell by 29% and the net profit of the company fell only by 11%. It has been brought down by cutting expenses from employee benefit expenses by 7% and falling operating expenses by 40%, owing mostly to power and fuel, by the implementation of a solar power plant in their manufacturing facility. As a result, the net income margin grew by 27% from FY20 to FY21. In FY19, the company incurred a sudden fall in its net profit owing to high interest expense on account of provision for taxes and contingencies, which was then reduced in FY20 by Rs. 13 Cr, resulting in the sudden jump in the net profits in FY20. 

GKN Driveline EPS Growth

Growth in %

  • -8.66%

    1 Year

  • -10.60%

    3 Year

  • 5.36%

    5 Year

EPS of GKN driveline has fallen in lieu of fall in the net profit of the company and there were no changes made in the number of shares in FY21. 

  • GKN Driveline Book Value Growth

Growth in %

  • -9.13%

    1 Year

  • -0.38%

    3 Year

  • 9.30%

    5 Year

GKN Driveline's book values were impacted due to fall in the retained earnings of the company by 13%, which was a result of lower net profit in FY21 than FY20 and the final dividend payment for 2019-20 of Rs. 107 Cr. at Rs. 84 per share. Aggregately fall in the book value of the company by 9% in FY21 from FY20. 

GKN Driveline EBITDA Growth

Growth in %

  • -13.08%

    1 Year

  • -11.26%

    3 Year

  • 3.99%

    5 Year

EBITDA of the company has shown de-growth of 13% from FY20 in FY21. Although, EBITDA margin grew by 23% from FY20 in FY21, due to write back of provision for interest and penalty on Income tax for Rs. 18 Cr. as the company has opted for Vivad se Vishwas Scheme for settlement of Income tax litigations and lower supplier provisions in FY21 by Rs. 7 Cr.

GKN Driveline Operating Profit Growth

Growth in %

  • -19.79%

    1 Year

  • -17.80%

    3 Year

  • 2.65%

    5 Year

GKN Driveline's EBIT showed de-growth of 20% from FY20 in FY21. This has been primarily due to the fall in the EBITDA of the company by 13%. Depreciation on the other hand, increased by Rs. 1 Cr in FY21, even with lower additions and higher disposal of tangible assets than FY20, due to purchases of softwares worth Rs. 8 Cr. and higher depreciated expenses associated in FY21.

GKN Driveline Asset Growth

Growth in %

  • -7.93%

    1 Year

  • -4.78%

    3 Year

  • 0.03%

    5 Year

Tangible assets of the company remained stagnant in FY21 from FY20. Despite this, total assets of the company fell by 8%, owing mostly to a fall in the current assets of the company, primarily cash and cash equivalent of the company, which decreased by Rs. 59 Cr. as a measure to distribute dividends and to make capital expenditure expenses. 

GKN Driveline Cash Flow from Operations

Growth in %

  • -52.94%

    1 Year

  • -6.23%

    3 Year

  • -10.25%

    5 Year

The cash flow of the company has been severely impacted due to the fall in net profits of the company and due to the write back of provision for interest and penalty on income tax for Rs. 18 Cr. as the company has opted for the Vivad se Vishwas Scheme for settlement of income tax litigation. The total receivables of the company have also increased significantly due to COVID-19, hindering the ability to collect, further causing the decrease in the cash flow from operations. 

GKN Driveline D/E Ratio

GKN Driveline Current Ratio

GKN Driveline Quick Ratio

GKN Driveline Interest Coverage Ratio

  • GKN Driveline Operating Efficiency

Despite lower sales of goods, the company has fairly performed well in improving its operating efficiency, which is attributable to two factors. First, the company's write-back of provision for interest and penalty on income tax for Rs.18 Cr. as the company has opted for the Vivad se Vishwas Scheme for settlement of income tax litigation and lower supplier provisions in FY21 by Rs. 7 Cr., improving the EBITDA margin of the company. Secondly, due to the reduction of power and fuel expenses by implementing a solar energy plant, the operating expenses of the company have come down. 

GKN Driveline Operating Profit EBIT Margin(OPM)

GKN Driveline Profit Before Tax Margin (PBT Margin)

GKN Driveline Profit After Tax Margin (PAT Margin)

  • GKN Driveline Profitablity Ratio

GKN Driveline Return on Equity(RoE)

Despite lower revenue and net profit, the company has been able to maintain its ROE level from FY20. This was due to a higher net income margin in FY21 than in FY20. Although it must be noted that the equity multiplier of the company has remained at its FY20 level, the asset turnover ratio witnessed a considerable fall, which has been impacted due to COVID-19 restrictions, and hence the company was unable to utilise its assets to its full extent. 

GKN Driveline Return on Capital Employed(RoCE)

Due to the company's inability to function at full capacity, ROCE decreased by 12% in FY21 compared to FY20. The company's net income dropped by 11%, the company did not take on any debt, and its equity dropped by 11%. As a result, ROCE was reduced due to lesser capital used and net earnings.

GKN Driveline Return to Assets (RoA)

The company was able to maintain its ROA level from FY20 to FY21. Although the marginal decline was an impact of COVID-19 restrictions, causing the company's inability to utilise its assets to its full extent. 

  • GKN Driveline Valuation Ratios

GKN Driveline Dividend Yield

GKN Driveline Earning Yield