How has been the historical performance of Morganite Crucib?

Revenue and Operating Income Growth

Over the seven-year period ending March 2017, Morganite Crucib’s net sales increased from ₹65.93 crores in 2010 to ₹113.40 crores in 2017, reflecting a robust upward trend. The company’s total operating income, which includes other operating income, rose correspondingly from ₹66.46 crores to ₹117.09 crores. This steady revenue growth underscores the firm’s ability to expand its market presence and product offerings effectively.

Notably, other operating income saw a gradual increase, reaching ₹3.69 crores in 2017 from a modest ₹0.53 crores in 2010, indicating diversification in income streams beyond core sales.

Cost Structure and Profitability Margins

Examining the cost components reveals a mixed picture. Raw material costs fluctuated but generally remained a significant portion of expenses, standing at ₹36.79 crores in 2017 compared to ₹27.02 crores in 2010. Employee costs have nearly tripled over the period, rising from ₹6.51 crores to ₹17.88 crores, reflecting possible workforce expansion or wage inflation. Manufacturing expenses also increased substantially, from ₹19.29 crores in 2010 to ₹28.70 crores in 2017, though power costs were eliminated by 2017, suggesting operational efficiencies or changes in energy sourcing.

Despite rising costs, the company improved its operating profit margin (excluding other income) from 23.01% in 2010 to 24.1% in 2017, with a peak dip in intermediate years. Gross profit margin similarly improved to 26.2% in 2017 from 22.87% in 2010, signalling enhanced cost management and pricing power.

Profitability and Earnings Trends

Profit before tax (PBT) exhibited a strong upward movement, climbing from ₹11.48 crores in 2010 to ₹25.74 crores in 2017. Correspondingly, profit after tax (PAT) more than doubled, reaching ₹16.17 crores in 2017 from ₹7.87 crores in 2010. The consolidated net profit followed a similar trajectory, rising from ₹7.23 crores to ₹14.52 crores over the same period.

Earnings per share (EPS) reflected this growth, increasing from ₹25.83 in 2010 to ₹51.87 in 2017, indicating enhanced shareholder value. The PAT margin improved from 11.84% in 2010 to 13.81% in 2017, despite some fluctuations in intermediate years, demonstrating the company’s ability to convert sales into net earnings more efficiently.

Cash Flow and Financial Health

Cash flow from operating activities showed significant improvement, rising from ₹2.88 crores in 2015 to ₹25.07 crores in 2017, highlighting stronger cash generation capabilities. Net cash inflow also surged to ₹16.17 crores in 2017 from a low of ₹2.38 crores in 2015, supported by prudent investing and financing activities. The company maintained a healthy cash and cash equivalents balance, which doubled from ₹15.94 crores in 2016 to ₹31.87 crores in 2017, providing ample liquidity for operational needs and growth initiatives.

Interest expenses have been effectively eliminated by 2017, reflecting a debt-free or low-debt capital structure, which reduces financial risk and interest burden.

Summary and Outlook

Overall, Morganite Crucib’s historical performance reflects a company that has steadily expanded its revenue base while improving profitability and cash flow generation. The elimination of interest costs and the growth in reserves from ₹23.43 crores in 2010 to ₹84.90 crores in 2017 further strengthen its financial position. Despite some cost pressures, the firm has managed to enhance margins and deliver consistent earnings growth, making it a noteworthy player in its sector.

Investors may find the company’s track record of operational improvement and financial discipline encouraging, especially given its ability to sustain profitability and build cash reserves over time.

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