Revenue and Profitability Trends
In the fiscal year ending March 2025, Sera Investments reported net sales of ₹11.59 crores, a sharp decrease from ₹22.86 crores in the previous year. This halving of revenue reflects a challenging operating environment or strategic shifts within the company. Correspondingly, the total operating income mirrored this decline, with no other operating income reported in either year.
Operating expenses excluding depreciation rose substantially, from ₹2.33 crores in March 2024 to ₹6.41 crores in March 2025. This increase was primarily driven by a rise in other expenses, which nearly tripled to ₹5.99 crores, alongside a modest increase in employee costs. Despite these higher costs, the company maintained a positive operating profit (PBDIT) of ₹5.18 crores, though this was significantly down from ₹20.53 crores a year earlier.
Interest expenses doubled to ₹1.90 crores, impacting the gross profit before depreciation and tax, which fell to ₹3.28 crores from ₹19.58 crores. Depreciation also increased, reflecting higher asset utilisation or additions. Ultimately, profit before tax dropped sharply to ₹2.60 crores from ₹19.33 crores, with profit after tax following suit, declining to ₹2.53 crores from ₹17.87 crores. Earnings per share (EPS) correspondingly fell from ₹2.75 to ₹0.39, indicating reduced returns to shareholders.
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Balance Sheet and Asset Growth
Sera Investments demonstrated robust growth in its balance sheet strength. Shareholder's funds surged to ₹293.79 crores in March 2025 from ₹69.14 crores the previous year, largely due to a substantial increase in reserves, which rose from ₹53.95 crores to ₹278.60 crores. This indicates strong internal capital generation or revaluation gains.
The company's total liabilities expanded significantly to ₹380.34 crores from ₹90.57 crores, driven by a rise in current liabilities from ₹23.42 crores to ₹153.10 crores. Short-term borrowings remained relatively stable at around ₹20 crores, while non-current liabilities increased notably, primarily due to deferred tax liabilities rising to ₹66.37 crores from a negligible amount.
On the asset side, total assets grew in tandem with liabilities to ₹380.34 crores from ₹90.57 crores. Current assets, including investments, increased markedly to ₹354.58 crores from ₹64.32 crores, reflecting a significant build-up in current investments from ₹33.84 crores to ₹324.18 crores. Net block assets also rose, indicating capital expenditure or asset acquisitions.
Cash Flow and Liquidity Position
Cash flow from operating activities improved substantially, turning positive at ₹9 crores in March 2025 compared to a negative ₹7 crores the previous year. This improvement was supported by stable working capital management, with no adverse changes reported in the latest year. However, cash flow from investing activities remained negative, increasing to ₹9 crores from ₹5 crores, signalling ongoing investment in assets or securities.
Financing activities saw no cash inflows in the latest year, contrasting with ₹13 crores raised in the prior period. The net cash inflow was modest at ₹1 crore, resulting in a closing cash and cash equivalents balance of ₹2 crores, up from ₹1 crore. This suggests a cautious approach to liquidity management amid fluctuating profitability.
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Margins and Efficiency Metrics
Margins have contracted sharply over the year. The operating profit margin excluding other income dropped from an exceptionally high 89.81% to 44.69%, while the gross profit margin declined from 85.65% to 28.3%. The profit after tax margin also fell significantly from 78.17% to 21.83%. These contractions reflect the combined impact of lower revenues, higher expenses, and increased interest costs.
Despite these margin pressures, the company’s book value per share improved markedly to ₹44.86 from ₹10.30, reflecting the strong growth in net assets and reserves. This improvement in net worth per share may provide a cushion for investors amid the earnings volatility.
Outlook and Considerations
Sera Investments’ historical performance over the last fiscal year reveals a company navigating a period of revenue contraction and margin compression, while simultaneously strengthening its balance sheet and investment portfolio. The significant increase in reserves and shareholder funds suggests a focus on long-term value creation, even as short-term profitability has been impacted.
Investors should weigh the company’s improved asset base and liquidity position against the reduced earnings and margins. The stable debt levels and positive operating cash flow are encouraging signs, but the sharp decline in profit metrics warrants close monitoring of future operational performance and market conditions.
Summary
In summary, Sera Investments has experienced a challenging year with a near 50% drop in revenue and a substantial decline in profits. However, the company has bolstered its financial foundation through increased reserves and investments, resulting in a stronger balance sheet and improved book value per share. Cash flow from operations has turned positive, indicating better cash management despite ongoing investments. The company’s future performance will depend on its ability to restore revenue growth and improve margins while maintaining financial discipline.
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