Bhagheeratha Engineering Annual Reports, Balance Sheet and Financials

Bhagheeratha Engineering Ltd Balance Sheet (Rs in Thousands)

 Bhagheeratha Engineering Ltd Profit & Loss Statement (Rs in Thousands)

 Bhagheeratha Engineering Ltd Consolidated Cash Flow Statement (Rs in Thousands)

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

Cash Flow from Operating Activities:

Operating activities represent the cash generated or used from the company’s core business operations.

Profit Before Tax decreased significantly, from Rs. 62,551 thousand in 2023 to Rs. 7,834 thousand in 2024, indicating a notable reduction in pre-tax profits.

Several non-cash adjustments and one-off items are added back to the profit. For example:

Depreciation dropped slightly from Rs. 2,779 thousand in 2023 to Rs. 2,151 thousand in 2024.

Compensation Expense (likely linked to employee benefits) increased significantly from Rs. 7,212 thousand in 2023 to Rs. 10,550 thousand in 2024, which might suggest higher employee-related costs.

Interest on Deposits shows a negative Rs. 31,298 thousand in 2024 compared to Rs. 24,821 thousand in 2023. This indicates the company earned significant interest on its deposits, which is a cash inflow from non-operating activities.

In 2023, large amounts such as creditors/payables written back (Rs. 56,895 thousand) and uncertified work written off (Rs. 17,453 thousand) significantly impacted cash flow adjustments. These items were absent in 2024, which influenced the reduction in operating cash flow.

Operating Profit before Working Capital Changes turned negative at Rs. -16,130 thousand in 2024, compared to a positive Rs. 9,149 thousand in 2023. This suggests a deterioration in core operational efficiency.

Adjustments related to working capital changes include:

A decrease in trade receivables by Rs. 3,577 thousand in 2024, indicating improved cash collection compared to the previous year.

However, the decrease in trade payables of Rs. 1,332 thousand and a significant decrease in other current liabilities and provisions by Rs. 11,145 thousand reduced cash flow in 2024. This suggests the company settled a significant portion of its liabilities during the year.

As a result, Cash Generated from Operations was negative, at Rs. -25,030 thousand in 2024 compared to Rs. 2,403 thousand in 2023. After accounting for taxes (Rs. -3,397 thousand in 2024), the Net Cash from Operating Activities was a negative Rs. -28,427 thousand in 2024, significantly worse than the negative Rs. -11,097 thousand in 2023. This indicates that the company’s core operations are consuming cash rather than generating it.

Cash Flow from Investing Activities:

Investing activities reflect cash flows from investments in long-term assets and financial instruments.

Purchase of fixed assets decreased to Rs. 633 thousand in 2024 from Rs. 1,356 thousand in 2023, indicating lower capital expenditure.

The company earned interest on deposits of Rs. 31,298 thousand in 2024, a significant increase from Rs. 24,821 thousand in 2023, which contributed positively to cash flow.

Overall, the company had a net cash inflow from investing activities of Rs. 30,665 thousand in 2024, up from Rs. 23,475 thousand in 2023. This positive cash flow, primarily from interest income, offsets the negative cash flow from operating activities.

Cash Flow from Financing Activities:

Financing activities involve cash flows related to borrowing and repayments of loans.

The company had minor financing cash flows in both years. In 2024, the net cash flow from financing activities was negative, at Rs. -1,471 thousand, compared to Rs. -1,000 thousand in 2023. This reflects repayments of long-term borrowings, with no new significant borrowings undertaken.

Net Increase/Decrease in Cash and Cash Equivalents:

Despite the negative operating cash flow, the overall net increase in cash and cash equivalents was Rs. 767 thousand in 2024, down from a larger increase of Rs. 11,378 thousand in 2023. This smaller increase is due to the negative cash flow from operations being largely offset by positive cash flow from investing activities.

The company had a healthy opening balance of cash and cash equivalents at Rs. 4,77,717 thousand in 2024, which increased slightly to Rs. 4,78,484 thousand by the end of the year. This strong cash balance provides a cushion despite the operating cash outflows.

Financial Ratios of Bhagheeratha Engineering Ltd

Here is a summary of the financial and operational metrics for Bhagheeratha Engineering Ltd for the year 2024 and 2023:

Current Ratio (in times):

The current ratio measures the company's ability to cover its short-term liabilities with its short-term assets. A current ratio of less than 1, as seen in both 2024 and 2023, indicates that the company does not have sufficient current assets to cover its current liabilities. With ratios of 0.638 in 2024 and 0.637 in 2023, the company is in a weak liquidity position, struggling to meet its short-term obligations.

Debt-Equity Ratio (in times):

The debt-equity ratio measures the company’s financial leverage and indicates the proportion of debt to shareholders' equity. A negative debt-equity ratio, as seen in both years, suggests that the company has negative equity, meaning its liabilities exceed its assets.

Return on Equity (ROE) Ratio (%):

ROE measures the company’s profitability relative to shareholders’ equity. A negative ROE in both years means the company is generating losses rather than returns for its shareholders. However, the improvement from -30.50% in 2023 to -2.93% in 2024 suggests that while the company is still unprofitable, its losses have narrowed

Return on Capital Employed (ROCE) Ratio (%):

ROCE measures the efficiency with which the company is using its capital (both equity and debt) to generate returns. A negative ROCE indicates that the company is not generating sufficient returns to cover the cost of capital, resulting in losses. The significant improvement from -39.63% in 2023 to -5.06% in 2024 reflects a substantial reduction in losses, suggesting improved operational performance or better capital management.