How has been the historical performance of Speciality Rest.?

Revenue and Profit Trends

Over the past six years, Speciality Rest. has seen its net sales rise from ₹346.36 crores in March 2019 to ₹436.25 crores in March 2025, reflecting a compound growth trend despite some volatility. Notably, sales dipped in the fiscal year ending March 2021 to ₹150.14 crores, likely impacted by broader economic disruptions, but rebounded strongly thereafter. Operating profit margins excluding other income have generally improved, reaching 16.64% in March 2025 compared to a low of -0.97% in March 2021. The company’s operating profit (PBDIT) excluding other income increased from a loss in 2021 to ₹72.60 crores in 2025, signalling operational recovery and efficiency gains.

Profit after tax (PAT) has also followed a similar pattern, with losses recorded in 2019 through 2021, including a significant negative PAT of ₹-29.20 crores in March 2021. However, the company returned to profitability with a PAT of ₹21.97 crores in March 2025. Earnings per share (EPS) mirrored this trend, improving from negative values in earlier years to a positive ₹4.50 in the latest fiscal year.

Cost Structure and Margins

The company’s cost of raw materials has increased in line with sales growth, rising from ₹108.91 crores in 2019 to ₹131.04 crores in 2025. Employee costs have also escalated steadily, reflecting expansion and possibly inflationary pressures, reaching ₹97.59 crores in the latest year. Selling and distribution expenses have decreased significantly from ₹63.35 crores in 2019 to ₹18.04 crores in 2025, indicating improved cost control or changes in sales strategy. Other expenses have risen consistently, reaching ₹116.98 crores in 2025, which may warrant further scrutiny for operational efficiency.

Despite these cost pressures, the gross profit margin improved to 17.79% in 2025 from a low of 5.23% in 2020, underscoring better pricing power or cost management. The PAT margin also turned positive, standing at 5.04% in 2025 compared to a negative 19.54% in 2021.

Balance Sheet and Financial Position

Speciality Rest.’s balance sheet reflects a strengthening financial position. Shareholders’ funds have more than doubled from ₹135.33 crores in 2021 to ₹326.98 crores in 2025, supported by rising reserves. The company maintains a debt-free status with zero long-term and short-term borrowings reported consistently over the years, which is a positive indicator of financial stability. Total liabilities have increased moderately, in line with asset growth, reaching ₹513.82 crores in 2025.

On the asset side, net block (net fixed assets) has grown from ₹55.00 crores in 2021 to ₹94.82 crores in 2025, signalling ongoing capital investment. Current assets have also expanded, with total current assets rising to ₹211.00 crores in 2025, supported by a substantial increase in current investments to ₹160.80 crores. Cash and bank balances have improved to ₹16.84 crores, enhancing liquidity.

Cash Flow and Operational Efficiency

Cash flow from operating activities has shown a positive trend, increasing from ₹21 crores in 2021 to ₹74 crores in 2025, reflecting improved core business cash generation. Investing activities have consistently been negative, indicative of ongoing capital expenditure and investments, with ₹27 crores spent in 2025. Financing activities have been negative as well, primarily due to repayments or dividend payments, amounting to ₹49 crores in 2025. The net cash inflow/outflow has been relatively stable, with a slight outflow of ₹2 crores in 2025, following a small inflow in previous years.

Overall, the company’s cash position remains healthy, with closing cash and cash equivalents rising from ₹1 crore in 2020 to ₹8 crores in 2025, supporting operational needs and financial flexibility.

Summary

Speciality Rest. has experienced a notable turnaround from losses in the early 2020s to consistent profitability and growth in recent years. The company’s revenue and profit margins have improved steadily, supported by disciplined cost management and capital investment. Its debt-free status and growing reserves enhance its financial resilience. While some expense categories warrant monitoring, the overall financial health and cash flow generation position Speciality Rest. favourably for future growth prospects.

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