How Has Anant Raj Limited’s (NSE:ANANTRAJ) Earnings Fared Against The Long Term Trend

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When Anant Raj Limited (NSE:ANANTRAJ) released its most recent earnings update (31 March 2019), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Understanding how Anant Raj performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see ANANTRAJ has performed.

See our latest analysis for Anant Raj

Did ANANTRAJ’s recent performance beat its trend and industry?

ANANTRAJ’s trailing twelve-month earnings (from 31 March 2019) of ₹687m has increased by 1.5% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -19%, indicating the rate at which ANANTRAJ is growing has accelerated. How has it been able to do this? Let’s take a look at if it is merely a result of industry tailwinds, or if Anant Raj has experienced some company-specific growth.

NSEI:ANANTRAJ Income Statement, June 17th 2019
NSEI:ANANTRAJ Income Statement, June 17th 2019

In terms of returns from investment, Anant Raj has fallen short of achieving a 20% return on equity (ROE), recording 1.6% instead. Furthermore, its return on assets (ROA) of 1.7% is below the IN Real Estate industry of 3.2%, indicating Anant Raj’s are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Anant Raj’s debt level, has declined over the past 3 years from 2.1% to 1.7%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 34% to 52% over the past 5 years.

What does this mean?

Anant Raj’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Recent positive growth isn’t always indicative of a continued optimistic outlook. I recommend you continue to research Anant Raj to get a better picture of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for ANANTRAJ’s future growth? Take a look at our free research report of analyst consensus for ANANTRAJ’s outlook.
  2. Financial Health: Are ANANTRAJ’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.