How has been the historical performance of Semac Construct?

Revenue and Operating Income Trends

Examining the net sales figures from March 2019 through March 2025, Semac Construct's revenue has demonstrated considerable variability. The company recorded a peak in net sales in the fiscal year ending March 2023, reaching over ₹325 crores, a substantial increase compared to previous years. However, this was followed by a sharp decline to approximately ₹173 crores in March 2025. This volatility suggests fluctuating demand or project cycles impacting the top line. Other operating income remained nil throughout this period, indicating the company’s reliance solely on core business operations for revenue generation.

Total operating income mirrored net sales trends, confirming the absence of ancillary income streams. The cost structure evolved notably, with manufacturing expenses becoming a significant component from March 2023 onwards, reaching ₹133.51 crores in March 2025. Employee costs showed a gradual decline from nearly ₹50 crores in 2019 to ₹23.33 crores in 2025, reflecting possible workforce optimisation or restructuring efforts. Other expenses also decreased over the years, contributing to cost containment.

Profitability and Margins

Semac Construct’s operating profit before depreciation, interest, and tax (PBDIT) excluding other income fluctuated significantly. The company posted positive operating profits in fiscal years 2019 through 2023, peaking at ₹26.38 crores in March 2023. However, the last two years saw operating losses, with March 2025 recording a marginal negative PBDIT of ₹4.33 crores. Including other income, operating profit also followed this pattern, with a peak of ₹31.02 crores in 2023 before turning negative in recent years.

Interest expenses increased notably in the latest fiscal year, reaching ₹5.52 crores in March 2025, which weighed heavily on gross profit and profit before tax. The company reported a loss before tax of ₹7.34 crores in March 2025, a stark contrast to the profits seen in earlier years. Correspondingly, the net profit after tax swung from a high of nearly ₹20 crores in 2023 to a loss of ₹5.94 crores in 2025. This resulted in a negative PAT margin of -3.38% in the latest year, compared to positive margins above 5% in prior years.

Balance Sheet and Financial Position

On the balance sheet front, shareholder funds declined from ₹182.90 crores in 2021 to ₹73.87 crores in 2025, reflecting accumulated losses and reserve erosion. Total liabilities also decreased from a high of ₹295.68 crores in 2021 to ₹213.67 crores in 2025, with short-term borrowings rising sharply in the latest year to ₹37.78 crores. The company maintained zero long-term borrowings throughout the period, indicating reliance on short-term financing.

Asset composition shifted as well, with net block assets dropping significantly from over ₹51 crores in 2021 to just above ₹1 crore in 2025, suggesting asset sales or depreciation. Current assets remained relatively stable, supported by cash and bank balances increasing to ₹58.26 crores in 2025, which may provide liquidity cushioning despite operational challenges.

Cash Flow Dynamics

Cash flow from operating activities has been inconsistent, with negative cash flows in recent years, including a ₹2 crore outflow in 2025. Investing activities showed net outflows, particularly in 2025 with ₹13 crores spent, while financing activities provided inflows of ₹16 crores, likely reflecting increased short-term borrowings. Overall, net cash inflows/outflows balanced out to zero in 2025, maintaining a stable closing cash position of ₹7 crores.

Summary of Historical Performance

Semac Construct’s historical performance is characterised by significant revenue fluctuations and a recent downturn in profitability. The company’s peak revenue in 2023 was followed by a sharp decline, accompanied by operating losses and increased interest costs. Despite these challenges, the firm has maintained a reasonable cash position and managed liabilities prudently by avoiding long-term debt. The erosion of shareholder funds and declining asset base highlight the need for strategic focus to restore profitability and growth momentum.

Investors should weigh the company’s cyclical nature and recent financial setbacks against its operational scale and liquidity position when considering its prospects. The volatility in earnings per share and margins underscores the importance of monitoring future quarterly results for signs of recovery or further stress.

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