Revenue and Profit Trends
Euro Leder Fash’s net sales have seen a marked contraction from the high levels recorded in the late 2010s. The company reported net sales of ₹75.12 crores in March 2018, which nearly halved to ₹33.28 crores by March 2024, before further declining to ₹18.40 crores in March 2025. This downward trend reflects significant challenges in maintaining top-line growth over the period.
Despite the decline in sales, the company’s operating profit (PBDIT) including other income has remained positive in recent years, with ₹1.84 crores reported in March 2025. This contrasts with earlier years such as 2018 and 2019, where operating profits were lower despite higher revenues, indicating improved cost management or other income contributions in recent periods.
Operating profit margins excluding other income have fluctuated considerably, turning negative in earlier years but stabilising around zero or slightly positive in the last two years. The gross profit margin has remained relatively stable, hovering around 2-3%, suggesting consistent control over direct costs despite revenue pressures.
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Cost Structure and Expenses
The company’s raw material costs have decreased in line with declining sales, from ₹65.40 crores in 2018 to ₹6.59 crores in 2025. Employee costs have remained relatively stable, fluctuating modestly between ₹3.28 crores and ₹4.54 crores over the years, reflecting a consistent workforce size or wage structure.
Other expenses have increased in recent years, reaching ₹5.88 crores in 2025 from negligible amounts in earlier years, which may indicate rising administrative or operational costs. Manufacturing expenses have been minimal or negative in recent years, a stark contrast to the substantial costs recorded in 2018 and 2019.
Balance Sheet and Financial Position
Euro Leder Fash’s total assets have contracted from ₹52.48 crores in 2023 to ₹40.33 crores in 2025, mirroring the decline in business scale. Shareholders’ funds have grown modestly from ₹13.42 crores in 2021 to ₹14.61 crores in 2025, supported by accumulated reserves.
The company carries no long-term borrowings, but short-term borrowings have decreased from ₹23.92 crores in 2023 to ₹13.45 crores in 2025, indicating a reduction in reliance on short-term debt. Trade payables and other current liabilities have also declined, suggesting improved working capital management.
Book value per share has shown a gradual increase, rising from ₹34.33 in 2021 to ₹37.37 in 2025, reflecting steady growth in net assets despite revenue challenges.
Cash Flow and Liquidity
Cash flow from operating activities has improved in recent years, with ₹4 crores generated in 2025 compared to negative cash flows in 2023. Investing activities have been minimal, while financing activities show net outflows in recent years, consistent with debt reduction efforts.
Closing cash and cash equivalents have remained modest but stable, around ₹2.00 to ₹3.00 crores, supporting the company’s liquidity position amid operational fluctuations.
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Profitability and Earnings
Profit after tax has shown variability, peaking at ₹0.71 crores in 2018 before declining to ₹0.19 crores in 2025. Earnings per share have followed a similar pattern, with a high of ₹1.82 in 2018 and a low of ₹0.49 in 2025. Despite the decline, the company has maintained positive net profits throughout the period.
Profit after tax margins have remained below 1.1%, indicating tight profitability in relation to sales. The company has not reported any extraordinary or exceptional items, suggesting consistent core business operations without significant one-off impacts.
Outlook and Considerations
Euro Leder Fash’s historical performance reflects a company facing considerable headwinds in revenue generation but managing to sustain profitability through cost control and other income. The reduction in debt and stable equity base provide a foundation for potential recovery, though the sharp sales decline warrants close monitoring.
Investors should weigh the company’s ability to stabilise revenues against its consistent profitability and improving cash flows when considering its future prospects.
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