Emrald Commercial Ltd Annual Report and Financials

Emrald Commercial Limited Balance Sheet (Rs in Hundred)

Emrald Commercial Limited Profit & Loss Statement (Rs in Hundred)

Emrald Commercial Limited Consolidated Cash Flow Statement (Rs in Hundred)

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 profit before tax of ₹18,176.19 in 2024, which is significantly lower than ₹99,370.27 reported in 2023. This indicates a reduction in overall profitability before considering tax expenses.

Adjustments for Depreciation:
The depreciation expense remains consistent year-over-year at ₹6,884.28, representing the systematic allocation of the cost of the company’s fixed assets over their useful lives.

Adjustment for Balance of Asset Written Off:
In 2024, the company made an adjustment for an asset write-off of ₹34,472.15, which had no equivalent in the previous year. This suggests that a significant portion of the company’s assets was written off, reducing the operating profit.

Operating Profit Before Working Capital Changes:
After accounting for depreciation and asset write-offs, the company had an operating loss of ₹9,411.68 in 2024 compared to a positive figure of ₹1,06,254.55 in 2023. This indicates the company struggled with core operational efficiency.

Adjustments for Working Capital:

Increase in Operating (Current) Assets:
There was a substantial increase in current assets of ₹3,76,191.26 in 2024 compared to ₹2,76,957.86 in 2023. This increase indicates the company tied up more cash in receivables, inventories, or other current assets, reducing liquidity.

Decrease in Operating (Current) Liabilities:
The company experienced a decrease in current liabilities of ₹1,01,605.62 in 2024, as opposed to an increase of ₹1,84,675.63 in 2023. A decrease in liabilities suggests that the company may have settled some of its short-term obligations, further straining cash flow.

Cash Generated from Operations:
As a result of the adjustments mentioned above, the company had a negative cash flow from operations amounting to ₹4,87,208.56 in 2024, compared to positive cash generation of ₹13,972.32 in 2023. This indicates that the company’s core business activities consumed more cash than they generated.

Income Tax Paid:
The company paid ₹25,836.30 in taxes in 2024, compared to ₹13,957.50 in 2023, further reducing the available cash.

Net Cash Inflow / Outflow from Operating Activities:
After considering taxes, the net cash outflow from operating activities was ₹5,13,044.86 in 2024, compared to a nominal inflow of ₹14.82 in 2023. This shows a severe deterioration in the cash generated from the company’s main operations.

Cash Flow from Investing Activities:

Purchase of Fixed Assets / Investments:
In 2024, the company invested ₹224.20 in fixed assets or new investments. This suggests a minor capital expenditure or purchase of financial investments.

Increase in Non-Current Assets:
The company saw a significant decrease in non-current assets by ₹5,66,394.13 in 2024, which could indicate the sale of long-term assets or the liquidation of investments. This contributed positively to the company’s cash flow.

Net Cash Inflow from Investing Activities:
The net cash inflow from investing activities was ₹5,66,169.93 in 2024, compared to ₹3,500.00 in 2023. This inflow highlights that the company managed to generate cash by liquidating long-term investments or assets.

Cash Flow from Financing Activities:

Net Cash Flow from Financing Activities:
The company did not engage in significant financing activities in either 2024 or 2023. There were no proceeds from borrowings or other financing activities, and no repayments were reported. As a result, there was no cash inflow or outflow from financing activities in both years.

Net Changes in Cash and Cash Equivalents:

Net Changes:
Despite the substantial cash outflow from operations, the company ended up with a net increase in cash and cash equivalents of ₹53,125.07 in 2024, compared to ₹3,514.82 in 2023. This was primarily due to the large cash inflows from investing activities.

Opening and Closing Cash Balances:
The opening balance of cash and cash equivalents at the start of 2024 was ₹17,653.91. After accounting for the net changes, the company’s closing balance of cash and cash equivalents at the end of 2024 stood at ₹70,778.98.

Components of Cash and Cash Equivalents:

Cash in Hand:
The company held ₹9,690.75 in cash as of March 31, 2024, down from ₹12,152.75 in 2023.

Deposits with Banks in Current Accounts:
The majority of the cash was held in bank deposits, with ₹61,088.23 in current accounts as of March 31, 2024, compared to ₹5,501.16 in 2023.

Total Cash and Cash Equivalents:
The total cash and cash equivalents amounted to ₹70,778.98 in 2024, a substantial increase from ₹17,653.91 in 2023.

Financial Ratios of Emrald Commercial Limited

Here is a summary of the financial and operational metrics for Emrald Commercial Limited for the years 2024 and 2023:

Current Ratio: 7.6 (2024) vs. 2.31 (2023)

Insight: A current ratio of 7.6 indicates that the company has significantly more current assets than current liabilities, which suggests strong liquidity. This is a marked increase from 2.31 in 2023, implying that the company is better positioned to meet its short-term obligations. While a high current ratio is generally favorable, it may also indicate underutilized assets or excess inventory.

Return on Equity Ratio (ROE): 0.0007 (2024) vs. 0.0035 (2023)

Insight: The ROE has decreased substantially, from 0.0035 in 2023 to 0.0007 in 2024. This decline indicates that the company is generating significantly less profit for its shareholders. A low ROE suggests inefficiency in utilizing equity capital, which could discourage potential investors and indicate poor profitability performance.

Inventory Turnover Ratio: 0.89 (2024) vs. 1.38 (2023)

Insight: A decrease in the inventory turnover ratio from 1.38 to 0.89 reflects a slower turnover of inventory, indicating that the company may be holding excess inventory or experiencing lower sales. This could lead to higher holding costs and potential obsolescence of products. The decline suggests a need for improved inventory management and sales strategies.

Net Capital Turnover Ratio: 0.22 (2024) vs. 0.22 (2023)

Insight: The net capital turnover ratio remains unchanged at 0.22, suggesting that the company is generating the same amount of sales per unit of capital employed as in the previous year. This stability indicates that the efficiency in utilizing capital has remained consistent, but it also highlights the potential for improvement in revenue generation from existing capital.

Net Profit Ratio: 0.77 (2024) vs. 4.28 (2023)

Insight: The net profit ratio has dramatically decreased from 4.28 to 0.77, indicating a significant decline in profitability. This substantial drop suggests that the company has experienced increased costs or reduced revenue, leading to lower net income. The low profit margin raises concerns about the company 's pricing strategy, cost control, and overall business sustainability.

Return on Capital Employed (ROCE): 0.0028 (2024) vs. 0.0136 (2023)

Insight: The ROCE has also decreased significantly from 0.0136 to 0.0028. This reduction indicates that the company 's ability to generate returns from its capital employed has weakened, reflecting inefficiencies in utilizing capital for productive purposes. The low ROCE could be attributed to reduced operating profits or higher capital costs.