Revenue and Profit Growth
Riddhi Corporate’s net sales increased significantly from the fiscal year ending March 2019 to March 2020, reflecting a robust growth trajectory. Total operating income rose from ₹59.53 crores to ₹81.47 crores, indicating a strong demand environment and effective business expansion. Despite no reported raw material costs, the company incurred higher purchase costs for finished goods and employee expenses, which rose notably during this period.
Operating profit before depreciation, interest, and tax (PBDIT) excluding other income improved markedly, more than quadrupling from ₹0.74 crores to ₹3.56 crores. Including other income, operating profit nearly doubled, reaching ₹4.83 crores in March 2020. This improvement was achieved alongside a reduction in interest expenses and a minor exceptional charge, which slightly tempered gross profit before depreciation and tax (PBDT) but still resulted in a substantial increase to ₹3.91 crores.
Profit before tax surged from ₹1.07 crores to ₹3.57 crores, while profit after tax rose from ₹0.81 crores to ₹1.45 crores. Consolidated net profit followed suit, increasing from ₹0.97 crores to ₹1.50 crores. Earnings per share (EPS) also showed a healthy rise, from ₹0.85 to ₹1.32, reflecting improved profitability on a per-share basis. Operating profit margin expanded from 1.24% to 4.37%, and the PAT margin improved from 1.36% to 1.78%, signalling enhanced operational efficiency and cost management.
Our latest weekly pick is out! This Large Cap from Steel/Sponge Iron/Pig Iron delivered with target price and complete analysis. See what makes this week's selection special!
- - Latest weekly selection
- - Target price delivered
- - Large Cap special pick
See This Week's Special Pick →
Balance Sheet and Financial Position
Examining the balance sheet, shareholder’s funds increased marginally from ₹23.33 crores in March 2018 to ₹23.76 crores in March 2019, supported by a rise in reserves from ₹12.21 crores to ₹13.71 crores by March 2020. The company’s equity capital remained stable at ₹11.38 crores with a face value of ₹10 per share. Book value per share also showed a positive trend, increasing to ₹20.89 in March 2019 from ₹20.51 the previous year.
Long-term borrowings decreased slightly, reflecting a cautious approach to debt management, while short-term borrowings appeared in the latest fiscal year at ₹2.29 crores, indicating some reliance on working capital financing. Total liabilities rose moderately to ₹44.11 crores by March 2019, up from ₹38.48 crores the previous year, consistent with the company’s growth and operational scale.
On the asset side, total current assets increased to ₹39.23 crores in March 2019 from ₹34.59 crores in March 2018, with current investments constituting a significant portion. Net current assets remained healthy at ₹27.07 crores, supporting liquidity and operational needs. Fixed assets showed a slight decline in net block value, reflecting depreciation, but capital work in progress increased, signalling ongoing investment in infrastructure.
Cash Flow and Operational Efficiency
Cash flow from operating activities improved substantially, turning positive at ₹6.00 crores in March 2019 after a negative outflow the previous year. This was supported by favourable changes in working capital and a net cash inflow of ₹6.00 crores overall. Investing activities showed a modest inflow, while financing activities reflected a small outflow, indicating prudent capital management. Closing cash and cash equivalents rose sharply to ₹7.00 crores in March 2019 from ₹1.06 crores in March 2018, enhancing the company’s liquidity position.
Riddhi Corporate or something better? Our SwitchER feature analyzes this Microcap Computers - Software & Consulting stock and recommends superior alternatives based on fundamentals, momentum, and value!
- - SwitchER analysis complete
- - Superior alternatives found
- - Multi-parameter evaluation
Summary and Outlook
Overall, Riddhi Corporate’s historical performance reveals a company on a growth path with improving profitability, stable equity base, and enhanced liquidity. The rise in operating and net profit margins alongside increased earnings per share highlights effective cost control and revenue growth. The balance sheet reflects a balanced approach to debt and equity financing, while cash flow improvements suggest better operational cash management.
Investors analysing Riddhi Corporate should note the company’s consistent upward trajectory in key financial metrics, which may bode well for future performance. However, the relatively modest profit margins and the presence of some short-term borrowings indicate areas for continued focus. Monitoring these factors alongside market conditions will be essential for assessing the company’s ongoing financial health and investment potential.
Limited Time Only! Subscribe for Rs. 12,999 and get 1 Year of MojoOne + an Additional Year Completely FREE. Don't miss out on this exclusive offer. Claim Your Free Year →
