Revenue and Profit Growth
DRC Systems’ net sales have exhibited a remarkable upward trend, more than tripling from ₹19.50 crores in March 2022 to ₹65.38 crores by March 2025. This consistent increase in top-line revenue underscores the company’s expanding market presence and operational scale. Correspondingly, total operating income mirrored this growth, reflecting the absence of other operating income during this period.
Operating profit before depreciation and interest (PBDIT) excluding other income surged from ₹2.27 crores in March 2022 to ₹20.74 crores in March 2025, indicating improved operational efficiency and cost management. The operating profit margin also strengthened significantly, rising from 11.64% to 31.72%, which points to enhanced profitability despite rising expenses.
Profit before tax (PBT) increased substantially from ₹1.21 crores to ₹16.74 crores, while profit after tax (PAT) soared from a modest ₹0.70 crores to ₹14.95 crores over the same period. The consolidated net profit followed suit, reaching ₹15.08 crores in March 2025. Although earnings per share (EPS) fluctuated, it remained healthy at ₹1.13 in the latest fiscal year, reflecting the company’s growing earnings base.
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Cost Structure and Margins
Examining the cost components, employee costs rose steadily from ₹9.32 crores to ₹19.89 crores, reflecting workforce expansion aligned with business growth. Manufacturing expenses also increased notably, from ₹6.16 crores in March 2022 to ₹19.72 crores in March 2025, indicating higher production activity. Other expenses grew moderately, maintaining a controlled cost environment.
Despite these rising costs, the company maintained a strong gross profit margin, averaging above 30% in the last two years, which is a positive indicator of pricing power and operational leverage. Interest expenses remained minimal and declined over time, contributing to improved net profitability.
Balance Sheet Strength and Asset Growth
DRC Systems’ total assets expanded significantly from ₹24.65 crores in March 2022 to ₹99.51 crores in March 2025, driven by investments in fixed assets and non-current investments. The net block of assets increased from ₹2.02 crores to ₹47.05 crores, signalling substantial capital expenditure and asset base enhancement. Non-current investments also rose steadily, supporting the company’s strategic growth initiatives.
Shareholders’ funds strengthened markedly, rising from ₹6.78 crores to ₹64.59 crores, reflecting retained earnings accumulation and equity infusion. Notably, the company eliminated long-term borrowings by March 2025, having repaid secured loans that stood at ₹15.15 crores in March 2022, thereby improving its financial leverage and reducing debt risk.
Current liabilities increased in line with business scale, but net current assets turned negative in the latest year, which may warrant monitoring for working capital management. Cash and bank balances fluctuated but remained positive, with closing cash equivalents at ₹2.06 crores in March 2025.
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Cash Flow and Financial Health
Cash flow from operating activities showed a strong improvement, moving from a negative ₹1 crore in March 2022 to a positive ₹32 crores in March 2025. This reflects enhanced cash generation from core operations, supporting the company’s growth and investment needs. However, cash flow from investing activities remained negative throughout, indicating ongoing capital expenditure and investment outflows consistent with asset growth.
Financing activities saw no inflows in the last two years, suggesting the company is relying on internal accruals rather than external borrowings. The net cash outflow in the latest year was modest at ₹2 crores, with closing cash balances remaining adequate for operational requirements.
Overall, DRC Systems has demonstrated a strong historical performance characterised by rapid revenue growth, improving profitability, prudent cost management, and a strengthening balance sheet. The elimination of debt and robust cash flow generation position the company favourably for sustained expansion and shareholder value creation.
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