Revenue and Operating Income Trends
Examining the standalone annual results from March 2019 through March 2025, Prem. Synthetic's net sales have experienced significant variability. The company recorded peak sales exceeding ₹58 crores in March 2022, followed by a sharp decline to under ₹15 crores by March 2025. This steep drop in revenue over the last two years contrasts with earlier years where sales fluctuated between ₹24 crores and ₹47 crores. Notably, other operating income remained consistently nil throughout this period, indicating reliance solely on core sales activities for revenue generation.
Total operating income mirrored net sales closely, reflecting the absence of additional operating revenue streams. The cost structure reveals a shift in raw material costs and purchase of finished goods, with the latter rising notably in recent years, suggesting changes in procurement or production strategies. The company’s expenditure profile also includes employee costs, power costs, and other expenses, which have generally remained modest relative to sales but contributed to overall cost pressures.
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Profitability and Margins
Operating profit before depreciation and interest (PBDIT) excluding other income has shown a mixed trend, with positive margins in most years except for a negative margin in March 2025. The operating profit margin excluding other income peaked at 8.58% in March 2021 but declined sharply to -7.5% by March 2025. Including other income, operating profit remained positive but modest, indicating some support from non-core income sources.
Profit before tax (PBT) and profit after tax (PAT) figures also reflect this volatility. PAT margins have ranged from a low of 0.04% in March 2023 to a high of 6.53% in March 2021, with a recent recovery to 5.47% in March 2025. Earnings per share (EPS) have followed a similar pattern, with a notable dip into negative territory in March 2024, before rebounding to a positive ₹3.25 per share in March 2025. These fluctuations highlight the challenges the company has faced in maintaining consistent profitability.
Cash Flow and Capital Structure
On the cash flow front, consolidated data from earlier years up to March 2014 shows generally positive cash flow from operating activities, with ₹10.21 crores recorded in that year. However, net cash inflows/outflows have been marginally negative in the years reviewed, indicating tight liquidity management. The company’s equity capital has remained stable at ₹4.59 crores with a face value of ₹10 per share, while reserves have grown steadily from ₹6.74 crores in March 2019 to ₹7.48 crores in March 2025, signalling some accumulation of retained earnings despite profit variability.
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Summary of Historical Performance
Overall, Prem. Synthetic's historical performance has been characterised by significant revenue swings and fluctuating profitability margins. The company achieved its highest sales and operating profits in the 2021-2022 period but has since faced a sharp downturn in sales and operating margins. Despite these challenges, the firm has managed to maintain positive net profits in recent years, supported partly by other income and cost management efforts.
Investors should note the volatility in earnings per share and operating margins, which reflect the cyclical nature of the business and possible operational adjustments. The steady growth in reserves and stable equity base provide some cushion, but the recent decline in sales and operating profit margin warrants cautious monitoring. Cash flow data, though limited to earlier years, suggests prudent liquidity management but does not provide a full picture of recent cash dynamics.
In conclusion, Prem. Synthetic presents a mixed historical performance profile with signs of recovery after periods of stress. Potential investors should weigh these factors carefully alongside sector trends and peer comparisons before making investment decisions.
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