Revenue and Operating Performance Trends
GFL's consolidated net sales have exhibited considerable volatility. The company reported peak sales figures in the fiscal years ending March 2019 and 2020, with revenues exceeding ₹2,700 crores. However, from March 2021 onwards, there was a dramatic contraction in sales, plunging to single-digit crore levels by March 2023 through to March 2025. This steep decline suggests a significant restructuring or operational shift within the company.
Operating profit margins, excluding other income, have generally remained healthy during periods of higher revenue, with margins around 16% to 30% in earlier years. Notably, the operating profit margin improved to over 50% in the most recent years despite the low revenue base, indicating tighter cost control or a change in business mix. However, the absolute operating profit values have diminished in line with the reduced turnover.
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Profitability and Earnings Analysis
The company's profit before tax and net profit figures have been highly erratic. While GFL posted a substantial profit before tax and net profit in the fiscal year ending March 2023, these figures were heavily influenced by exceptional items. In contrast, the years before and after saw significant losses, with net losses recorded in March 2021, 2022, 2024, and 2025. Earnings per share (EPS) mirrored this volatility, swinging from a high positive EPS in 2023 to negative values in recent years.
Tax provisions have also fluctuated, occasionally showing negative values, which may indicate deferred tax assets or adjustments. The presence of exceptional items, particularly in 2023, has distorted the profitability picture, suggesting that underlying operational performance may be weaker than headline numbers imply.
Balance Sheet and Asset Base Evolution
GFL's total assets have contracted significantly from over ₹9,400 crores in March 2020 to around ₹2,685 crores by March 2025. This reduction aligns with the decline in operating scale and possibly asset divestitures or impairments. Shareholders' funds have remained relatively stable in recent years, hovering around ₹2,500 crores, supported by reserves that have fluctuated but remained substantial.
The company shows no long-term or short-term borrowings in recent years, indicating a debt-free position. However, non-current liabilities have decreased sharply from over ₹2,500 crores in 2020 to under ₹165 crores in 2025, reflecting a significant deleveraging or settlement of obligations.
Non-current investments have increased markedly in recent years, reaching over ₹2,650 crores by March 2025, which may represent strategic holdings or reclassification of assets. Current assets have diminished substantially, consistent with the reduced operational scale.
Cash Flow and Liquidity Position
Cash flow from operating activities has been inconsistent, with strong inflows in 2020 and 2023 but negative or negligible cash flows in other years. Investing activities have generally resulted in cash outflows, reflecting ongoing capital expenditure or investments. Financing activities have also been a source of cash outflow in some years, possibly due to debt repayments or other financing adjustments.
The closing cash and cash equivalents have declined from ₹48 crores in 2020 to negligible levels in recent years, indicating tighter liquidity. The company’s net cash inflow/outflow figures suggest a cautious cash management approach amid fluctuating operational performance.
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Summary and Outlook
Overall, GFL's historical performance reflects a company that has undergone significant transformation and faced considerable challenges. The sharp decline in sales and profits after 2020 contrasts with earlier years of robust revenue and moderate profitability. The balance sheet shows a marked reduction in assets and liabilities, with a shift towards a leaner, possibly more investment-focused structure.
While recent operating margins appear strong on a percentage basis, the low absolute revenue and net losses highlight ongoing operational hurdles. Investors should carefully consider these factors alongside the company's strategic initiatives and market conditions when evaluating GFL's future prospects.
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