Revenue and Operating Performance
In the fiscal year ending March 2025, Raymond Lifestyl reported net sales of ₹6,176.74 crores, marking a decrease from ₹6,535.41 crores in the prior year. The total operating income mirrored this trend, showing a contraction that highlights the company's struggle to sustain top-line growth. Despite a slight reduction in raw material costs and purchase of finished goods, overall expenditure excluding depreciation rose marginally to ₹5,708.99 crores from ₹5,598.83 crores, driven by increased employee and manufacturing expenses as well as other operational costs.
The operating profit before depreciation and interest (PBDIT) excluding other income halved to ₹467.75 crores from ₹936.58 crores, reflecting pressure on core profitability. However, other income improved to ₹183.24 crores, contributing to a total operating profit of ₹650.99 crores, down from ₹1,090.97 crores the previous year. This indicates some offset from non-operating sources but not enough to fully counterbalance the decline in operating earnings.
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Profitability and Margins
Interest expenses increased slightly to ₹207.35 crores from ₹195.69 crores, while depreciation rose notably to ₹321.35 crores from ₹246.30 crores, reflecting higher asset base utilisation or capitalisation. Exceptional items swung negatively by ₹62.28 crores compared to a significant positive adjustment of ₹2,156.01 crores in the previous year, which had bolstered profits substantially.
Consequently, profit before tax plunged to ₹60.01 crores from ₹639.79 crores, and after accounting for taxes of ₹21.82 crores, net profit stood at ₹38.19 crores, a sharp decline from ₹479.52 crores. The consolidated net profit also fell dramatically to ₹38.19 crores from ₹2,644.72 crores, influenced by prior year adjustments and extraordinary items. Earnings per share (EPS) reflected this downturn, dropping to ₹6.27 from an exceptionally high ₹3,457.15, signalling a return to more normalized earnings levels.
Margins contracted significantly, with operating profit margin excluding other income falling to 7.57% from 14.33%, gross profit margin declining to 6.17% from 13.56%, and profit after tax margin narrowing to 0.62% from 7.34%. These figures underscore the margin pressures faced by the company amid rising costs and subdued revenue growth.
Balance Sheet and Financial Position
On the balance sheet front, shareholder's funds remained relatively stable at ₹9,587.67 crores compared to ₹9,662.16 crores, despite an increase in equity capital to ₹12.18 crores from ₹1.53 crores. Total liabilities rose to ₹12,690.96 crores from ₹11,910.68 crores, driven by higher long-term borrowings which increased to ₹372.60 crores from ₹209.88 crores and short-term borrowings rising to ₹896.97 crores from ₹615.53 crores. This indicates a greater reliance on debt financing over the year.
Asset-wise, net block increased to ₹7,727.16 crores from ₹7,468.61 crores, supported by capital work in progress and intangible assets under development. Current assets grew to ₹4,437.24 crores from ₹3,989.98 crores, with cash and bank balances notably improving to ₹400.88 crores from ₹160.06 crores, enhancing liquidity. Inventories and sundry debtors remained broadly steady, reflecting consistent operational scale.
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Cash Flow and Liquidity
Cash flow from operating activities showed a marked improvement to ₹404 crores from ₹37 crores, indicating better cash generation despite profit pressures. However, cash flow from investing activities turned negative at ₹-280 crores compared to a positive ₹1,304 crores previously, reflecting increased capital expenditure or investments. Financing activities generated a positive cash inflow of ₹58 crores, reversing the prior year's outflow of ₹-1,402 crores, suggesting some debt raising or equity infusion.
The net cash inflow for the year was ₹182 crores, a turnaround from a net outflow of ₹-60 crores in the previous year. Closing cash and cash equivalents rose significantly to ₹263 crores from ₹81 crores, strengthening the company's liquidity position.
Summary
Overall, Raymond Lifestyl's historical performance over the last fiscal year reflects a period of subdued revenue growth and margin compression, impacted by higher costs and exceptional items. While profitability has declined sharply from the previous year’s elevated levels, the company has maintained a stable balance sheet with increased borrowings and improved cash flows from operations. Investors should weigh these factors carefully, considering the company's efforts to manage costs and enhance liquidity amid challenging market conditions.
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