Revenue and Operating Performance Trends
Examining the company's net sales from fiscal year ending March 2019 through March 2025, there is a clear downward trend in top-line revenue. Starting from ₹37.53 crores in March 2019, sales steadily declined to ₹22.06 crores by March 2025. This represents a contraction of over 40% in six years, signalling pressures on the company's market demand or pricing power.
Operating profit margins have mirrored this trend. The operating profit before depreciation, interest, and tax (PBDIT) excluding other income peaked around ₹3.45 crores in March 2021 but fell sharply to ₹1.37 crores by March 2025. Correspondingly, the operating profit margin dropped from a healthy 12.35% in 2021 to 6.21% in 2025, indicating rising costs or reduced operational efficiency.
Gross profit margins have also been volatile, with a negative margin of -3.35% in the latest fiscal year, contrasting with positive albeit modest margins in prior years. This suggests that the cost of raw materials and other expenses have increasingly eroded the company's profitability.
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Profitability and Earnings Analysis
Profit before tax has been inconsistent, with losses recorded in several years including a notable loss of ₹2.09 crores in March 2025. Profit after tax similarly reflects this volatility, with losses in recent years offset by occasional marginal profits. The fiscal year ending March 2025 saw a net loss of ₹2.17 crores, despite an extraordinary income adjustment of ₹2.32 crores, indicating underlying operational challenges.
Earnings per share (EPS) have fluctuated accordingly, with a negative EPS in 2020 and 2022, and a modest recovery to ₹0.26 in 2025. This volatility in earnings underscores the company's struggle to maintain consistent profitability for shareholders.
Balance Sheet and Financial Position
On the balance sheet front, shareholder funds have slightly decreased from ₹4.81 crores in 2020 to ₹3.98 crores in 2025, reflecting accumulated losses and negative reserves. Meanwhile, the company's total debt has increased significantly, rising from ₹18 crores in 2020 to over ₹32 crores in 2025, highlighting a growing reliance on borrowings to finance operations or investments.
Long-term borrowings have nearly doubled over this period, with unsecured loans constituting a substantial portion. This elevated leverage may increase financial risk, especially given the company's recent profitability challenges.
Asset-wise, net block values have remained relatively stable around ₹9 crores, while current assets have increased, driven largely by rising inventories which grew from ₹7.30 crores in 2020 to ₹21.65 crores in 2025. This build-up in inventory could indicate slower sales or stockpiling, potentially tying up working capital.
Cash Flow and Liquidity Considerations
Cash flow data reveals limited operating cash generation, with no significant inflows reported in recent years. Investing activities have consistently shown outflows, while financing activities have provided modest inflows, suggesting the company has been dependent on external funding to support its cash requirements. The closing cash and cash equivalents have remained negligible, indicating tight liquidity conditions.
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Summary of Historical Performance
Overall, Polycon International's historical performance over the past six years has been characterised by declining revenues, squeezed margins, and fluctuating profitability. The company has faced increasing cost pressures and has relied more heavily on debt financing, which has raised its financial risk profile. While there have been occasional positive earnings and operating profit margins, the general trend points to operational and financial challenges that the company must address to restore sustainable growth and shareholder value.
Investors analysing Polycon Intl. should consider these factors carefully, weighing the company's current financial health against its historical volatility and leverage levels before making investment decisions.
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