How has been the historical performance of Ent.Network?

Revenue and Operating Income Trends

Over the past seven years, Ent.Network's net sales have exhibited notable volatility. The company recorded its highest sales in the fiscal year ending March 2019, with ₹620.80 crores, followed by a decline to ₹272.09 crores in March 2021. However, a recovery phase is evident as sales rose to ₹544.15 crores by March 2025, nearly doubling from the 2021 low. Total operating income mirrored this trend, reflecting the absence of other operating income throughout the period.

Profitability Fluctuations and Margins

Profitability has been inconsistent, with operating profit (PBDIT) excluding other income swinging from a peak of ₹139.14 crores in March 2019 to a significant loss of ₹85.36 crores in March 2023. The company rebounded to a positive operating profit of ₹78.56 crores by March 2025. Operating profit margins followed a similar pattern, peaking above 22% in 2019 and 2020, dipping into negative territory in 2023, before recovering to 14.55% in 2025. Net profit margins also reflected this volatility, with a sharp negative margin of -41.0% in 2021 improving to a positive 2.21% in 2025.

Cost Structure and Expenses

Ent.Network's expenditure profile shows rising employee costs and manufacturing expenses in recent years, with employee costs increasing from ₹92.52 crores in 2021 to ₹140.75 crores in 2025, and manufacturing expenses rising from ₹94.54 crores to ₹196.32 crores over the same period. Other expenses also increased, indicating higher operational costs. Despite these rising costs, the company managed to improve its operating profit in the latest fiscal years, suggesting better cost management or revenue quality.

Balance Sheet and Financial Position

The company's total assets have remained relatively stable, fluctuating between ₹1,074 crores and ₹1,320 crores over the last six years. Shareholders' funds have decreased from ₹917.26 crores in 2020 to ₹776.30 crores in 2025, reflecting the impact of losses in certain years. Notably, Ent.Network carries no long-term or short-term borrowings, indicating a debt-free position, which is a positive sign for financial stability. Deferred tax liabilities have been negative in recent years, suggesting tax assets on the balance sheet.

Cash Flow and Liquidity

Cash flow from operating activities has shown resilience, with ₹25 crores generated in the latest fiscal year despite challenges. Investing activities have consistently been cash outflows, reflecting ongoing investments in the business. Financing activities have also been net outflows, possibly due to repayments or dividend payments. The closing cash and cash equivalents stood at ₹18 crores in March 2025, down from ₹70 crores the previous year, indicating tighter liquidity but still a positive cash balance.

Summary of Earnings and Shareholder Returns

Earnings per share (EPS) have reflected the company's profit volatility, with a high of ₹11.31 in 2019, plunging to a negative ₹34.59 in 2023, and recovering to ₹2.42 in 2025. Book value per share has declined from ₹192.42 in 2020 to ₹162.85 in 2025, consistent with the profit fluctuations and reserve movements. Reserves have decreased from ₹869.59 crores in 2020 to ₹728.63 crores in 2025, indicating some erosion of retained earnings during loss-making years.

Outlook Considerations

Ent.Network's historical performance depicts a company that has faced significant operational and profitability challenges, particularly around 2021 to 2023, but has shown signs of recovery and stabilisation in recent years. The absence of debt and positive cash flow from operations provide a solid foundation for future growth. Investors should weigh the company's recent return to profitability against its past volatility and monitor ongoing cost management and revenue trends closely.

Get 2 full years of MojoOne Premium for only Rs. 12,999. Subscribe for 1 year and we'll add another year FREE. Offer valid for a limited time. Start Saving Now →