Revenue and Profitability Trends
Over the past seven years, Sanco Trans has shown a generally upward trend in net sales, rising from ₹82.19 crores in March 2016 to ₹118.80 crores in March 2022. Despite some fluctuations, the company’s total operating income has steadily increased, reflecting growth in its core business activities. Notably, the operating profit margin (excluding other income) improved from 7.96% in 2016 to 8.85% in 2022, with a peak dip around 2019 and 2020, indicating enhanced operational efficiency in recent years.
Profit after tax (PAT) reveals a significant recovery, moving from losses in the earlier years—such as a negative ₹1.77 crores in 2017—to a robust profit of ₹8.42 crores in 2022. Earnings per share (EPS) mirror this trend, rising from a negative ₹9.85 in 2017 to a positive ₹46.78 in 2022, underscoring the company’s improved bottom-line performance. The PAT margin also turned positive, reaching 7.09% in 2022 compared to negative margins in prior years.
Only 1% make it here. This Large Cap from the Gems, Jewellery And Watches sector passed our rigorous filters with flying colors. Be among the first few to spot this gem!
- - Highest rated stock selection
- - Multi-parameter screening cleared
- - Large Cap quality pick
Cost Structure and Expenditure Analysis
The company’s expenditure profile reveals that manufacturing expenses constitute the largest cost component, rising significantly from ₹33.11 crores in 2017 to ₹90.67 crores in 2022. Employee costs have remained relatively stable, hovering around ₹10.5 crores annually. Selling and distribution expenses have notably declined over the years, reaching zero in 2022, which may indicate a strategic shift or cost optimisation in marketing and distribution efforts. Other expenses have fluctuated but remain a smaller portion of total costs.
Interest expenses have decreased from ₹3.70 crores in 2017 to ₹1.91 crores in 2022, reflecting a reduction in debt servicing costs. This is complemented by the presence of exceptional items in 2022, which positively impacted gross profit before depreciation and tax. Depreciation expenses have steadily declined from ₹6.70 crores in 2017 to ₹3.04 crores in 2022, suggesting asset ageing or changes in capital expenditure.
Balance Sheet and Asset Management
Sanco Trans’s total assets have gradually decreased from ₹157.32 crores in 2017 to ₹138.90 crores in 2022, indicating a possible consolidation or asset optimisation strategy. Shareholders’ funds have increased from ₹93.37 crores in 2017 to ₹103.96 crores in 2022, reflecting retained earnings and improved equity base. The company’s long-term borrowings have been significantly reduced from ₹11.49 crores in 2017 to ₹3.74 crores in 2022, signalling a stronger financial position and lower leverage.
Current liabilities have also decreased from ₹47.50 crores in 2017 to ₹24.94 crores in 2022, improving the company’s liquidity profile. Net block, representing the net value of fixed assets, has declined from ₹110.58 crores in 2017 to ₹98.34 crores in 2022, consistent with depreciation trends. The book value per share has increased from ₹518.71 in 2017 to ₹577.53 in 2022, indicating enhanced shareholder value.
Cash Flow and Financial Health
Cash flow from operating activities has shown a positive trajectory, rising from ₹6.26 crores in 2017 to ₹9.00 crores in 2022, demonstrating improved cash generation from core operations. Investing activities have fluctuated, with a positive inflow of ₹2.00 crores in 2022 compared to negative cash flow in some prior years, suggesting selective capital expenditure or asset sales. Financing activities have consistently shown outflows, reflecting debt repayments and possibly dividend payments or share buybacks.
The net cash inflow in 2022 stood at ₹2.00 crores, with closing cash and cash equivalents increasing to ₹5.00 crores, up from ₹2.55 crores in 2018, indicating a healthier liquidity position. The company’s working capital position has improved, with net current assets turning positive in 2022 after several years of negative figures, which bodes well for short-term financial stability.
Why settle for Sanco Trans? SwitchER evaluates this Transport Services Microcap against peers, other sectors, and market caps to find you superior investment opportunities!
- - Comprehensive evaluation done
- - Superior opportunities identified
- - Smart switching enabled
Summary and Outlook
In summary, Sanco Trans has exhibited a commendable recovery from losses to profitability over the last several years. The company’s revenue growth, improved profit margins, and strengthened balance sheet reflect effective management and operational improvements. Reduced debt levels and enhanced cash flows further contribute to a more robust financial foundation. While manufacturing expenses have increased, the overall cost structure appears to be under control, supporting sustainable earnings growth.
Investors may find the company’s improved earnings per share and book value per share encouraging, alongside its positive cash flow trends. However, continued monitoring of cost management and capital expenditure will be essential to maintain this upward trajectory. Overall, Sanco Trans’s historical performance suggests a resilient business with potential for further growth and value creation.
Get 2 full years of MojoOne Premium for only Rs. 12,999. Subscribe for 1 year and we'll add another year FREE. Offer valid for a limited time. Start Saving Now →
