How has been the historical performance of Gandhi Spl. Tube?

Revenue and Profit Growth Trajectory

Over the seven-year period ending March 2025, Gandhi Spl. Tube's net sales have shown a robust upward trend, rising from ₹122.91 crores in 2019 to ₹172.54 crores in 2025. This represents a compound growth trajectory, with notable acceleration post-2020, reflecting the company's expanding market presence and operational scale. The total operating income mirrors this pattern, as other operating income remained negligible throughout.

Operating profit before depreciation and interest (PBDIT) excluding other income has also improved significantly, climbing from ₹45.74 crores in 2019 to ₹68.37 crores in 2025. When factoring in other income, operating profit reached ₹80.26 crores in the latest fiscal year, up from ₹53.45 crores six years prior. This growth underscores effective cost management and operational efficiency, despite rising raw material and power costs.

Profit before tax increased from ₹49.75 crores in 2019 to ₹76.75 crores in 2025, while profit after tax rose from ₹38.63 crores to ₹58.67 crores over the same period. Earnings per share (EPS) followed suit, nearly doubling from 27.95 to 48.25, signalling enhanced shareholder returns. The company maintained a healthy profit after tax margin around 30% to 34%, indicating sustained profitability.

Cost Structure and Margins

The company’s raw material costs have increased in absolute terms, from ₹43.76 crores in 2019 to ₹60.38 crores in 2025, reflecting higher production volumes and input prices. However, Gandhi Spl. Tube has managed to keep its operating profit margin (excluding other income) consistently strong, improving from 37.21% in 2019 to 39.63% in 2025. Gross profit margin also expanded from 43.49% to 46.43% over the same period, highlighting effective pricing and cost control strategies.

Employee costs and power expenses have risen moderately, consistent with business growth and inflationary pressures. Other expenses have fluctuated but remained controlled relative to revenue. The company’s interest expenses are minimal, reflecting a debt-free capital structure, which supports profitability and financial stability.

Balance Sheet Strength and Asset Quality

Gandhi Spl. Tube’s shareholder funds have grown substantially, from ₹146.57 crores in 2020 to ₹265.74 crores in 2025, driven by retained earnings and reserves. The book value per share has nearly doubled from ₹113.46 in 2020 to ₹218.68 in 2025, indicating enhanced net asset value for investors.

The company maintains a zero-debt position, with no long-term or short-term borrowings reported in recent years. Total liabilities have increased in line with business expansion but remain manageable. Non-current investments have surged, reflecting strategic asset allocation, while current assets have fluctuated but remain adequate to support operations.

Net block of fixed assets has slightly declined from ₹48.40 crores in 2020 to ₹42.89 crores in 2025, possibly due to depreciation exceeding capital expenditure. Cash and cash equivalents have remained modest but stable, with closing balances around ₹3 crores in 2025.

Cash Flow and Operational Efficiency

Cash flow from operating activities has shown a positive trend, increasing from ₹18 crores in 2020 to ₹47 crores in 2025. This improvement reflects stronger earnings and efficient working capital management. Investing activities have generally involved outflows, consistent with asset acquisitions and investments, while financing activities have been net outflows, indicating no new borrowings and possible dividend payments or share buybacks.

Net cash inflow/outflow has been largely balanced in recent years, with a slight negative in 2024 but overall stable liquidity. The company’s ability to generate cash internally supports its debt-free status and financial flexibility.

Summary

In summary, Gandhi Spl. Tube has exhibited a solid historical performance characterised by steady revenue growth, expanding profit margins, and a strong balance sheet free of debt. The company’s consistent earnings growth and rising book value per share reflect sound management and operational resilience. While costs have increased in line with scale, effective control measures have preserved healthy profitability. Cash flow generation remains robust, supporting ongoing investments and shareholder returns. Investors seeking a financially stable and growing small-cap industrial stock may find Gandhi Spl. Tube’s track record reassuring, though comparative analysis with peers is advisable for portfolio optimisation.

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 →