Operating Cash Flow

Inference:
• The company is growing at a very good rate. Their net operating cash flow has increased around 4 times (i.e. 1000cr) in the last 5 years. Their profit has
also increased considerably around 1300cr.
• Their net operating cash flow has decreased in the last year (2022) even though there was a huge surge in the profit. This is because of an increase in tax
paid and an increase in working capital (increase in inventories and decrease in accounts payables)
• In 2020 there was a huge surge in net cash flow from operations, this is because of an increase in non-cash items i.e. depreciation.
• From 2018 to 2019 they doubled their inventory which was compromised a bit the next year. This also contributes to the increase in net cash flow from
operations in 2020.
• Overall, the company is performing very well in terms of operations. Their profit is growing, and working capital management is also very good (even if
they increase an inventory in a year, they can sell that in the next year. Their accounts receivables are low, and they can increase the account payables by
delaying payments if needed.
 Investing and Financing Cash Flow

Investing cash flow has

become positive in 2018
because of more return
from other investment

Financing cash flow is

negative because there is less
investment and more returns
Inference:
• The company’s net investment cash flow is very high in 2017 and 2020 because of very high other investments.
• During those two years (2017 and 2020) they have increased cash by issuance of stock to meet their investing demand.
• The firm is maintaining cash flow very well by mostly financing through equity and not debt. They are not borrowing money in cash as large which is a
good thing.
• They are constantly investing in capital expenditure, especially in properties which is good for a retail firm.
• For the past 2 years they have not borrowed and only repaying the debt. They are maintaining their long-term investment also from operating revenue
which is highly positive for the firm.
• Overall considering the lifetime of the company they are well established and functioning very well. Their profits have grown fast in the recent past.
 Credit Management:
• The company has increased the cash and its
equivalents in 2023. It was also increased in 2021,
which shows that they can liquidate money easily
when needed.
• Their inventory has been gradually increasing,
which won’t be an issue until they maintain the
cash cycle very well.
• Their current liabilities are very low as compared
to current assets. They will be able to manage
short-term debts very well.
• Their accounts payables are increasing and are
about half of the current liabilities and lower than
accounts receivables which shows that they
maintain credit with suppliers and buyers very
well.
• Their short-term debt is zero. This is very good as
they don’t want to pay any interest.
• Their long-term debt is also low. They finance
their assets mostly by shareholder equity. This
reduces additional financing expenses in terms of
interest.
• Their shareholder equity is 8 times the total
liability which is enormous.
• The firm is in a very good financial position
overall in terms of credit and cash management.
* Current assets and current liabilities