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Financial Analysis of VLCC India LTD

VLCC India Ltd, founded in 1989, is a prominent wellness and beauty services company in India with international operations. The company demonstrates moderate profitability and a strong equity base, with no reliance on debt, making it a moderate-risk investment in the wellness sector. While it offers steady returns, it does not possess the financial robustness of zero-debt firms.

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Naveen Bharath
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44 views10 pages

Financial Analysis of VLCC India LTD

VLCC India Ltd, founded in 1989, is a prominent wellness and beauty services company in India with international operations. The company demonstrates moderate profitability and a strong equity base, with no reliance on debt, making it a moderate-risk investment in the wellness sector. While it offers steady returns, it does not possess the financial robustness of zero-debt firms.

Uploaded by

Naveen Bharath
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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FINANCIAL ANALYSIS OF

VLCC INDIA LTD


2024201019
Naveen Bharath
ABOUT THE
COMPANY
Founded in 1989

VLCC India Ltd is a leading wellness and beauty services company in India,
specializing in weight management, skincare, and fitness solutions.

Offers a range of services including weight management programs, skin


and body treatments, hair care, and advanced dermatology and
cosmetology solutions

VLCC has expanded its operations internationally, with presence in various


countries across Asia and Africa
INVESTMENT
ANALYSIS

EPS (FY2024): ₹5.20 (approximate)


ROE: 12.5%
ROCE: 15.8%
Net Profit Margin: 8.2%
Current Ratio: 1.8​

Inference:
VLCC demonstrates moderate profitability with a healthy return on
capital. The net profit margin indicates efficient cost management. A
current ratio of 1.8 suggests a comfortable liquidity position.
COST OF CAPITAL

Cost of Equity (Dividend Method): 1.2%


Cost of Equity (EPS Method): 10.4%
Cost of Debt: 7.5%​

Inference:
The low dividend yield reflects a conservative dividend policy. The cost
of equity based on EPS is reasonable, indicating investor confidence. The
cost of debt is within acceptable limits, suggesting manageable
borrowing costs.
LEVERAGE AND MARKET
CAPITALIZATION

Operating Leverage (DOL): ≈1.5


Financial Leverage (DFL): ≈1.3
Combined Leverage (DCL): 1.95
Market Capitalization: ~₹1,200 crore

Inference:
The combined leverage indicates a balanced use of fixed and variable
costs. The market capitalization reflects the company's position in the
wellness industry. The leverage ratios suggest moderate financial risk.
CAPITAL STRUCTURE

Total Debt: ₹0 Cr (negligible interest-bearing debt)


Equity + Reserves: ₹57,000+ Cr (approximate)
Debt-Equity Ratio: 0.00 (₹0 / ₹57,000)

Inference:
Extremely strong equity base with no reliance on borrowings; growth
financed entirely via equity.
LEVERAGE AND MARKET
CAPITALIZATION
FY2020: ₹0.50
FY2021: ₹0.60
FY2022: ₹0.60
FY2023: ₹0.60
FY2024: ₹0.60
Dividend Yield: 1.2%

Inference:
The consistent dividend payout reflects stable earnings. A dividend yield
of 1.2% is modest, indicating a focus on reinvestment. The policy
supports long-term growth strategies.
WORKING CAPITAL ANALYSIS
(FY2024)

Current Assets: ₹450 crore


Current Liabilities: ₹250 crore
Working Capital: ₹200 crore
Current Ratio: 1.8​

Inference:
A current ratio of 1.8 signifies strong short-term financial health. The
positive working capital ensures operational efficiency. The company is
well-positioned to meet its short-term obligations.
OVERALL EVALUATION

VLCC India Ltd is a mid-cap player with moderate financial health. It


offers niche growth in wellness.

VLCC India ltd is a moderate-risk investment with steady but not


spectacular returns.

It suits investors looking for exposure to India’s wellness sector but


lacks the financial robustness of zero-debt firms
THANK YOU!

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