Ajay Bio-tech (india) Limited Ltd Balance Sheet (Rs in Lakhs)

Ajay Bio-tech (india) Limited Ltd Profit & Loss Statement (Rs in Lakhs)

 Ajay Bio-tech (india) Limited Ltd Consolidated Cash Flow Statement (Rs in Lakhs) 

Here is a summary of the Cash Flow Statement for the years 2024 and 2023:

Cash Flow from Operating Activities:

Net Profit before Tax:

The company reported a net loss before tax of Rs. 172.41 Lakhs for FY 2023-24 compared to a larger loss of Rs. 793.23 Lakhs in FY 2022-23. This indicates a significant reduction in the operating loss year-over-year, which is a positive sign. The company is moving closer to break-even or profitability in terms of its core business operations.

Adjustments for Non-Cash Items:

The adjustments for non-cash items such as Depreciation (Rs. 119.59 Lakhs), Sundry balances written off (Rs. 12.65 Lakhs), Provision for doubtful debts (Rs. 43.65 Lakhs), and Provision for stock obsolescence (Rs. 55.63 Lakhs) are added back to the net profit. These adjustments reflect non-cash expenses or provisions made to account for potential future losses, impairments, or obsolescence. This is common in financial statements as these expenses don 't represent actual cash outflows but are required for accounting purposes.

The loss/gain on the sale of property, plant & equipment (PPE) and foreign exchange gains/losses are also adjusted. For instance, the net loss on PPE disposal (Rs. 1.42 Lakhs) and foreign exchange loss (Rs. 0.24 Lakhs) are minor adjustments that slightly affect the overall operating cash flow.

Interest Income (Rs. 35.16 Lakhs) is deducted as it’s part of financing activities rather than operating activities. Similarly, Interest Expense (Rs. 91.89 Lakhs) is added back to reflect actual cash outflows related to borrowing costs.

Operating Profit before Working Capital Charges:

After these adjustments, the operating profit before changes in working capital stands at Rs. 142.25 Lakhs for FY 2023-24, a significant recovery from the negative Rs. 477.59 Lakhs in the previous year. This indicates that the core operations of the business are improving, with a reduction in operating losses.

Changes in Working Capital:

Working capital adjustments include changes in trade receivables, loans and advances, inventories, other assets, trade payables, other liabilities, and provisions. These adjustments help to reflect how the company’s operations are funded through its working capital.

The increase in trade receivables (-Rs. 155.65 Lakhs) implies that the company’s customers owe more money at the end of the year, which is a cash outflow.

The increase in loans and advances (Rs. 127.84 Lakhs) suggests that the company is advancing more funds, potentially to suppliers or employees, or investing in other operational areas.

The increase in inventories (Rs. 52.75 Lakhs) is another cash outflow, as the company’s cash is tied up in stock that has not yet been sold.

On the positive side, the decrease in trade payables (-Rs. 214.61 Lakhs) and other current liabilities (-Rs. 228.80 Lakhs) indicate that the company has settled some of its obligations, leading to cash outflows.

Net Cash From Operating Activities:

The overall result from operating activities is a net outflow of Rs. 262.38 Lakhs for FY 2023-24, which is a worsening of cash flow compared to Rs. 152.49 Lakhs outflow in FY 2022-23. Despite the positive operating results, the significant cash outflows from working capital adjustments contributed to the negative cash flow.

Cash Flow from Investing Activities:

Investing Cash Flows primarily relate to the company’s purchase and sale of property, plant, and equipment (PPE), as well as interest income received and changes in deposits.

The payment for procurement of PPE and capital advances (-Rs. 195.44 Lakhs) indicates a significant cash outflow as the company has been investing in its assets. This could represent spending on new plant, machinery, or technology.

The proceeds from sale of PPE (Rs. 10.38 Lakhs) are relatively small in comparison, which indicates that the company is not liquidating its assets significantly to fund operations.

The deposits/balances with banks (Rs. 162.94 Lakhs) show a cash inflow, likely due to temporary surplus funds being placed in interest-bearing deposits or investments.

The interest received (Rs. 35.16 Lakhs) reflects the income earned from the company’s cash reserves or investments.

Net Cash From Investing Activities:

The overall result is a net outflow of Rs. 249.35 Lakhs for FY 2023-24, slightly higher than the Rs. 241.60 Lakhs outflow in FY 2022-23. The company is continuing to invest in its physical assets while receiving some income from interest-bearing deposits.

Cash Flow from Financing Activities:

Financing Activities include transactions involving the company’s capital structure, such as borrowings and repayments.

The company has borrowed Rs. 347.91 Lakhs in FY 2023-24, which is a significant cash inflow. This likely represents new loans or credit facilities to support its operations or growth.

On the other hand, the repayment of borrowings (-Rs. 7.53 Lakhs) and interest paid (-Rs. 91.89 Lakhs) are outflows related to the company’s existing debt obligations.

Loans and advances (Rs. -63.42 Lakhs) indicate a cash outflow related to advances or loans given to others, which could be for business operations or capital investments.

The dealers ' security deposits (net of repayments) Rs. 1.65 Lakhs is a minor cash inflow.

Net Cash From Financing Activities:

The overall net inflow from financing activities is Rs. 186.72 Lakhs, which is slightly lower than the previous year’s Rs. 203.02 Lakhs. Despite this slight decrease, the company still raised significant funds through borrowing.

Net Change in Cash and Cash Equivalents:

The net increase in cash and cash equivalents for FY 2023-24 is Rs. -62.63 Lakhs, indicating a reduction in cash reserves. This is a worsened position compared to the previous year, where the cash decrease was Rs. 38.58 Lakhs.

Cash at the beginning of the year was Rs. 71.75 Lakhs, and at the end of the year, it stands at Rs. 9.12 Lakhs. This large decrease in cash is primarily due to the negative operating and investing cash flows.

Financial Ratios of Ajay Bio-tech And Produce Home Finance Limited

Here is a summary of the financial and operational metrics for Ajay Bio-tech (india) Limited Ltd for the year 2023-24 & 2022-23:

Current Ratio

2023-24: 2.53

2022-23: 2.64

The Current Ratio measures a company 's ability to cover its short-term liabilities with its short-term assets. A ratio above 1 indicates good liquidity, suggesting that the company can meet its current obligations. In 2023-24, the ratio is 2.53, meaning the company has Rs. 2.53 in assets for every Rs. 1 in liabilities. This is a solid liquidity position, although it has slightly decreased from 2.64 in 2022-23.

Debt-Equity Ratio

2023-24: 0.26

2022-23: 0.17

The Debt-Equity Ratio shows the proportion of debt used to finance the company’s assets in relation to equity. A lower ratio indicates less reliance on debt, thus lower financial risk. In 2023-24, the ratio is 0.26, meaning the company has Rs. 0.26 of debt for every Rs. 1 of equity.

Debt Service Coverage Ratio (DSCR)

2023-24: 0.13

2022-23: -1.45

The Debt Service Coverage Ratio measures the company’s ability to cover its debt obligations (interest and principal) from its operating income. A ratio above 1 indicates sufficient earnings to meet debt payments. In 2023-24, the ratio is 0.13, which is significantly low and suggests that the company is struggling to generate enough income to meet its debt obligations. It’s an improvement from the -1.45 in 2022-23.

Return on Equity (ROE)

2023-24: -0.04

2022-23: -0.17

Return on Equity measures the profitability of a company in relation to shareholders ' equity. A negative ROE indicates that the company is incurring losses relative to its equity. In 2023-24, the ROE is -0.04, meaning the company lost Rs. 0.04 for every Rs. 1 of equity invested. While still negative, this is an improvement from -0.17 in 2022-23, where the company was losing Rs. 0.17 for every Rs. 1 of equity

Inventory Turnover Ratio

2023-24: 1.86

2022-23: 1.82

The Inventory Turnover Ratio measures how efficiently a company sells and replaces its inventory. A higher ratio indicates better inventory management and quicker sales. In 2023-24, the ratio is 1.86, which is a slight improvement over 1.82 in 2022-23. This suggests that the company has become marginally more efficient in managing its inventory.

Trade Receivables Turnover Ratio

2023-24: 2.64

2022-23: 2.78

The Trade Receivables Turnover Ratio measures how often the company collects its accounts receivable during the year. A higher ratio indicates quicker collection of payments from customers, improving cash flow. In 2023-24, the ratio is 2.64, a slight decrease from 2.78 in 2022-23.

Trade Payables Turnover Ratio

2023-24: 4.18

2022-23: 5.03

The Trade Payables Turnover Ratio measures how quickly the company pays its suppliers. A higher ratio indicates faster payment, while a lower ratio suggests the company is taking longer to pay its creditors. In 2023-24, the ratio is 4.18, a decrease from 5.03 in 2022-23.

Net Capital Turnover Ratio

2023-24: 2.18

2022-23: 2

The Net Capital Turnover Ratio measures the company’s ability to generate revenue from its capital base (both equity and debt). A higher ratio indicates better utilization of capital. In 2023-24, the ratio is 2.18, a slight improvement from 2 in 2022-23, meaning the company is generating more revenue per unit of capital employed.

Net Profit Ratio

2023-24: -0.04

2022-23: -0.17

The Net Profit Ratio measures the company’s profitability as a percentage of its total revenue. A negative net profit ratio indicates a loss. In 2023-24, the ratio is -0.04, meaning the company lost Rs. 0.04 for every Rs. 1 of sales. This is an improvement from -0.17 in 2022-23

Return on Capital Employed (ROCE)

2023-24: -0.03

2022-23: -0.14

Return on Capital Employed measures how effectively the company uses its capital (equity and debt) to generate profits. A negative ROCE indicates inefficient capital usage. In 2023-24, the ROCE is -0.03, which is an improvement from -0.14 in 2022-23, meaning the company is losing less in relation to the capital employed.