Revenue and Profitability Trends
Panabyte Tech's net sales demonstrated considerable variation from fiscal year 2017 through 2021. The company recorded its highest total operating income in the year ending March 2018, reaching over ₹40 crores. However, this peak was followed by a sharp decline, with sales dropping to approximately ₹15 crores in 2020 and further down to under ₹10 crores in 2021. This downward trend indicates a contraction in the company's core business activities.
Operating profit margins have mirrored this volatility. In 2018, the company achieved a positive operating profit margin of around 1.4%, but this was not sustained in subsequent years. The margin turned negative in 2019 and remained below zero through 2021, with the latest fiscal year showing an operating loss margin exceeding 1.5%. Similarly, the profit after tax margin followed a comparable pattern, peaking at nearly 2.8% in 2017 before slipping into negative territory in recent years.
Profit after tax figures further underscore the challenges faced by Panabyte Tech. After posting a profit of over ₹0.6 crores in 2018, the company swung to losses in 2019 and 2021, with the latest year showing a net loss of approximately ₹0.23 crores. Earnings per share have also reflected this trend, peaking at ₹1.44 in 2018 before declining to a negative value in 2021.
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Cost Structure and Expenses
The company's expenditure profile reveals that the purchase of finished goods constitutes the largest component of total operating expenses, consistently accounting for the majority of costs each year. For instance, in 2018, this expense was nearly ₹35 crores, closely aligned with the total operating income, indicating a high cost of goods sold ratio. Other expenses such as employee costs and other operating expenses have remained relatively modest but stable over the years.
Despite efforts to manage costs, Panabyte Tech has struggled to maintain positive operating profits, with interest expenses rising notably in 2021 to ₹0.22 crores from negligible levels in prior years. Exceptional items have also impacted profitability, with negative adjustments recorded in recent years.
Balance Sheet and Financial Position
On the balance sheet front, Panabyte Tech's total assets have contracted from over ₹17 crores in 2018 to around ₹11.7 crores in 2021. Shareholders' funds have similarly declined, reflecting accumulated losses and negative reserves. The company’s equity capital has remained steady at ₹4.39 crores throughout the period, but reserves have turned negative, reaching over ₹1 crore in deficit by 2021.
Liabilities have also shifted, with the introduction of long-term borrowings in 2021 amounting to ₹0.26 crores and a rise in short-term borrowings to over ₹2 crores. Trade payables and other current liabilities have decreased from their 2018 highs but remain significant relative to the company's size. The book value per share has declined from ₹8.96 in 2018 to ₹7.6 in 2021, indicating erosion in net asset value.
Cash Flow and Liquidity
Cash flow statements reveal limited operating cash inflows in recent years, with a negative cash flow from operating activities recorded in 2020. Investing activities have been minimal, and financing activities have not contributed significantly to cash reserves. The closing cash and cash equivalents position has deteriorated, showing negative values in 2020 and 2021, which may raise concerns about liquidity management.
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Summary and Outlook
Overall, Panabyte Tech's historical performance has been marked by significant fluctuations in revenue and profitability, with a notable peak in 2018 followed by a period of contraction and losses. The company’s cost structure, particularly the high purchase of finished goods, has constrained margins, while rising interest expenses and negative reserves have weighed on financial health. The decline in cash reserves and increasing borrowings suggest liquidity pressures that require careful monitoring.
Investors analysing Panabyte Tech should consider these trends alongside sector dynamics and peer performance to assess the company’s prospects. While recent losses pose challenges, the company’s stable equity base and efforts to manage costs may provide a foundation for potential recovery.
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