Garg Acrylics Annual Reports | Balance Sheet

Garg Acrylics Limited (Garg Acrylics ) Return Comparision with Primex 40 Index

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Garg Acrylics Limited

Garg Acrylics Limited Balance Sheet (Rs in Lakhs)

Particulars	31-03-2024	31-03-2023
Non-current assets
Property, Plant and Equipment	40503.25	26998.62
Capital work-in-progress	233.69	3248.56
Intangible Assets	4.36	4.88
Investments	170.14	71.75
Other financial assets	51.96	97.19
Other Non Current assets	697.65	1343.16
Current assets
Inventories	40100.87	37062.01
Trade receivables	19895.33	17776.98
Cash and cash equivalents	91.38	46.79
Bank Balance other than above	559.29	444.72
Other financial assets	433.07	1426.39
Other current assets	7300.14	6214.22
Total Assets	110041.12	94735.27
Equity and Liabilities Equity
Equity Share capital	664.28	664.28
Other Equity	45226.64	47788.61
Non-controlling interests	0.30	0.30
Non-current liabilities
Borrowings	12498.82	5505.41
Provisions	441.06	425.15
Deferred tax liabilities (Net)	402.66	49.16
Other non-current liabilities	-	1.78
Current liabilities
Borrowings	40757.68	34420.09
Trade payables
Total outstanding dues of Micro and Small Enterprises	1128.36	14.12
Total outstanding dues of creditors other than Micro	7570.39	4262.55
and Small Enterprises - Other financial liabilities	110.85	16.09
Other current liabilities	1048.80	1346.60
Provisions	191.28	205.66
Current tax provisions (net)	-	35.48
Total Equity and Liabilities	110041.12	94735.27

Garg Acrylics Limited Profit & Loss Statement (Rs in Lakhs)

Particulars	31-03-2024	31-03-2023
Revenue from operations	160514.11	160177.45
Other income	227.28	197.67
Total Income	160741.39	160375.12
Expenses :
Cost of materials consumed	113388.99	119307.60
Purchases of stock-in-trade	490.34	25.79
Changes in inventories of finished goods, work-in-progress and stock-in-trade	2921.22	(9058.04)
Employee benefits expense	10501.78	10579.97
Finance costs	4784.19	3516.56
Depreciation and amortization expense	2980.78	3524.01
Other expenses	28122.46	29469.96
Total Expenses	163189.78	157365.84
Profit(Loss) before exceptional items and tax	(2448.39)	3009.28
Exceptional Items	56.90	(129.18)
Profit(Loss) after exceptional items and before tax	(2391.49)	2880.09
Current tax	-	756.12
Deferred tax	309.45	(106.34)
Prior Year Tax Provisions	(8.01)	1.64
Profit(Loss) for the year	(2692.93)	2228.68
Other Comprehensive Income
Items that will not be reclassified to profit or loss
Remeasurements of the defined benefit plans	175.00	140.59
Income tax relating to items that will not be reclassified to profit or loss	(44.04)	(35.38)
Total Comprehensive Income for the year	(2561.98)	2333.88
Profit Attributable to:
- Owners of the parent	(2692.93)	2228.84
- Non Controlling interest	-	(0.17)
Other Comprehensive Income Attributable to:
- Owners of the parent	130.95	105.21
Total Comprehensive Income Attributable to:
- Owners of the parent	(2561.98)	2334.05
- Non Controlling interest	0.00	(0.17)
Earnings per equity share
Basics	(40.54)	33.55
Diluted	(40.54)	33.55

Garg Acrylics Limited Consolidated Cash Flow Statement (Rs in Lakhs)

Particulars	31-03-2024	31-03-2023
Cash Flow from Operating Activities
Net Profit before tax	-2391.49	2880.09
Adjustments for :
Depreciation and amortisation	2980.78	3524.01
Interest expense	4485.86	3328.83
Fair Valuation Gain(-)Loss(+) on Investment	-23.39	1.09
Deferrred Revenue on Capital Subsidy	-2.11	-2.11
Interest income	-201.52	-190.97
Profit(-)/Loss(+) on sale of Assets(Net)	-56.90	4.48
Gratuity Provision	1.52	31.74
Gratuity-Other Comprehensive income	175.00	140.59
Operating Profit before working capital changes	4967.75	9717.76
Adjustments for Changes in Working capital:
Increase(-)/Decrease(+) in Trade and other Receivables	-1520.19	7890.88
Increase(-)/Decrease(+) in Inventories	-3038.86	2890.63
Increase(+)/(Decrease)(-) in Trade Payables and other Liabilities	4183.90	(5468.02)
Cash generated from Operations	4592.60	15031.24
Net income tax paid	8.01	-757.76
Net Cash flow from(+)/used in(-) Operating Activities	4600.61	14273.48
Cash Flow from Investing Activities
Purchase of Fixed Assets	-13500.11	-3853.39
Proceeds from sale of Fixed Assets	87.00	38.49
Purchase of Investments	-75.00	-68.75
Interest income	201.52	190.97
Increase(-)/Decrease(+) in Investments	-13286.59	-3692.68
Cash Flow from Financing Activities
Proceeds(+)/Repayment(-) from Long Term Borrowings (Net)	6983.56	-4938.80
Redemption of Preference Shares	0.00	-530.43
Proceeds(+)/Repayment(-) from Short Term Borrowings (Net)	6337.60	-1816.67
Interest Paid	-4476.01	-3286.65
Net Cash flow from(+)/used in(-) Financing Activities	8845.15	-10572.56
Net Increase in cash and cash equivalents	159.17	8.24
Cash and cash equivalents at the beginning of the year	491.51	483.27
Cash and cash equivalents at the end of the year	650.67	491.51
Cash and Cash Equivalent include:-
Cash In hand	89.41	41.22
In Current Accounts	1.97	5.57
In Deposits Accounts	559.29	444.72
Total	650.67	491.51

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

Operating Activities

Net Profit Before Tax:

2024: -2391.49 lakhs

2023: 2880.09 lakhs

The company reported a net loss before tax of Rs. 2,391.49 lakhs in 2024, a significant decline from a net profit of Rs. 2,880.09 lakhs in 2023. This indicates a deterioration in profitability in the current year.

Adjustments for Non-Cash Items:

Depreciation and amortisation have been Rs. 2,980.78 lakhs in 2024, slightly lower than Rs. 3,524.01 lakhs in 2023.

Interest expense increased to Rs. 4,485.86 lakhs from Rs. 3,328.83 lakhs, reflecting higher borrowing costs in 2024.

Fair valuation losses on investments in 2024 amounted to Rs. 23.39 lakhs, compared to a small gain of Rs. 1.09 lakhs in 2023, signaling some volatility in investment valuations.

Working Capital Adjustments:

There was a significant decrease in trade receivables in 2024, amounting to Rs. 1,520.19 lakhs, compared to an increase of Rs. 7,890.88 lakhs in 2023. This suggests that the company faced challenges in collecting its receivables in the current year.

Inventories saw an increase of Rs. 3,038.86 lakhs in 2024, compared to a smaller increase of Rs. 2,890.63 lakhs in 2023, implying a higher accumulation of stock.

Trade payables and other liabilities increased by Rs. 4,183.90 lakhs in 2024, compared to a decrease of Rs. 5,468.02 lakhs in 2023. This indicates that the company has been able to delay payments to suppliers and manage its liabilities more effectively in 2024.

Net Cash Flow from Operating Activities:

2024: Rs. 4,600.61 lakhs

2023: Rs. 14,273.48 lakhs

Despite the decline in profitability, the company still generated positive cash flows from operating activities in 2024. However, the cash flow is significantly lower compared to 2023, mainly due to the decline in net profit and changes in working capital.

Investing Activities

Purchase of Fixed Assets:

2024: Rs. 13,500.11 lakhs

2023: Rs. 3,853.39 lakhs

The company made significant investments in fixed assets during 2024, increasing capital expenditures substantially. This suggests a possible expansion or upgrading of infrastructure, equipment, or property.

Sale of Fixed Assets:

The company generated Rs. 87.00 lakhs from the sale of fixed assets in 2024, a modest increase from Rs. 38.49 lakhs in 2023.

Investments:

The company made net investments of Rs. 13,286.59 lakhs in 2024, compared to Rs. 3,692.68 lakhs in 2023. This suggests that the company has increased its investment in financial instruments or other assets, possibly to diversify or strengthen its financial position.

Net Cash Flow from Investing Activities:

2024: Rs. 16,738.42 lakhs (cash inflow)

2023: Rs. 8,348.96 lakhs (cash inflow)

The company experienced a higher net cash inflow from investing activities in 2024, largely due to proceeds from the sale of investments. This indicates a favorable outcome from investment activities, despite significant capital spending.

Financing Activities

Borrowings:

The company raised Rs. 6,983.56 lakhs in long-term borrowings in 2024, compared to a net repayment of Rs. 4,938.80 lakhs in 2023. The increase in borrowings could be to support capital expansion or to refinance existing obligations.

The company also raised Rs. 6,337.60 lakhs from short-term borrowings in 2024, compared to a net repayment of Rs. 1,816.67 lakhs in 2023.

Redemption of Preference Shares:

In 2024, the company did not redeem any preference shares, compared to a redemption of Rs. 530.43 lakhs in 2023.

Interest Paid:

The company paid Rs. 4,476.01 lakhs in interest in 2024, higher than Rs. 3,286.65 lakhs in 2023, reflecting the increased debt levels.

Net Cash Flow from Financing Activities:

2024: Rs. 8,845.15 lakhs (cash inflow)

2023: Rs. -10,572.56 lakhs (cash outflow)

Financing activities provided a significant cash inflow in 2024, largely due to increased borrowings, reversing the cash outflow from 2023 when the company repaid more than it borrowed.

Net Change in Cash and Cash Equivalents

2024: Rs. 159.17 lakhs

2023: Rs. 8.24 lakhs

The company saw a modest increase in cash and cash equivalents in 2024, reflecting overall positive cash flow despite the challenges faced in operating and investing activities.

Cash and Cash Equivalents at the End of the Year:

2024: Rs. 650.67 lakhs

2023: Rs. 491.51 lakhs

The company 's cash balance at the end of 2024 increased compared to the previous year, indicating that despite challenges in operating and investing activities, the company maintained sufficient liquidity.

Financial Ratios of Garg Acrylics Limited

Particulars	2024	2023
Current ratio	1.35	1.56
Debt equity ratio	1.16	0.82
Debt service coverage ratio	0.58	0.81
Return on equity ratio	-0.06	0.05
Inventory turnover ratio	4.75	4.78
Trade recivables turnover ratio	8.52	7.71
Trade payables turnover ratio	18.39	19.75
Net capital turnover ratio	9.13	7.07
Net profit ratio	-1.68	1.39
Return on capital employed	2.35	7.38
Return on Investment
Unquoted	789.59	-27.31
Quoted	132.94	66.02

Here is a summary of the financial and operational metrics for Garg Acrylics Limited for the year 2024 and 2023:

Current Ratio:

The current ratio has decreased from 1.56 in 2023 to 1.35 in 2024, indicating a slight decline in the company’s ability to cover its short-term liabilities with its short-term assets. Although still above 1, which suggests adequate liquidity, the drop could signal a slight deterioration in the company 's short-term financial health.

Debt Equity Ratio:

The debt equity ratio has increased significantly from 0.82 in 2023 to 1.16 in 2024. This indicates that the company has taken on more debt relative to its equity base, which could increase financial risk. A higher debt equity ratio suggests that the company is more reliant on borrowed funds to finance its operations, which could be a concern if the company faces difficulties in servicing this debt.

Debt Service Coverage Ratio (DSCR):

The debt service coverage ratio has decreased from 0.81 in 2023 to 0.58 in 2024, which is a negative sign. A DSCR below 1 indicates that the company may not be generating enough operating income to cover its debt obligations. This suggests potential liquidity stress, as the company might struggle to meet its debt payments from its operational cash flows.

Return on Equity (ROE):

ROE has turned negative in 2024, declining from 0.05 (5%) in 2023 to -0.06 (-6%) in 2024. This suggests that the company is generating a loss relative to its equity capital in 2024, compared to a modest return in 2023. The negative return indicates a decrease in profitability and suggests that the company has not been able to generate sufficient returns on its shareholders ' investments.

Net Profit Ratio:

The net profit ratio has worsened dramatically from 1.39% in 2023 to -1.68% in 2024, reflecting a significant decline in the company 's profitability. This indicates that the company is now operating at a loss, with costs and expenses outweighing revenues, whereas in the prior year, the company was able to generate a positive net profit margin.

Return on Capital Employed (ROCE):

ROCE has decreased sharply from 7.38% in 2023 to 2.35% in 2024. A lower ROCE indicates that the company is less efficient at generating profits from its capital employed. This significant drop could be due to lower profitability or higher capital usage without a proportional increase in earnings.

Inventory Turnover Ratio:

The inventory turnover ratio has remained almost the same between 2023 and 2024, showing a slight decrease from 4.78 to 4.75. This suggests that the company’s efficiency in managing its inventory has remained stable, though a marginal decline could indicate slightly slower inventory turnover or a build-up of unsold stock.

Trade Receivables Turnover Ratio:

The trade receivables turnover ratio has improved from 7.71 to 8.52, indicating that the company is collecting its receivables more quickly in 2024 than in 2023. This is a positive sign, suggesting improved cash flow management and more efficient credit policies.

Trade Payables Turnover Ratio:

The trade payables turnover ratio has decreased from 19.75 in 2023 to 18.39 in 2024. This indicates that the company is taking slightly longer to pay its suppliers, which could be a strategy to optimize cash flow or may reflect slower payment cycles.

Net Capital Turnover Ratio:

The net capital turnover ratio has increased from 7.07 to 9.13, suggesting that the company has become more efficient in utilizing its capital to generate revenue. A higher ratio indicates better use of capital in relation to sales generation.

Return on Investment (Unquoted):

The return on investment for unquoted investments has seen a massive improvement, turning from a negative return in 2023 to a very high positive return in 2024. This could be due to successful investments or capital gains from the unquoted assets.

Return on Investment (Quoted):

The return on quoted investments has doubled from 66.02% in 2023 to 132.94% in 2024, indicating a substantial increase in the profitability of the company 's quoted investments. This could suggest successful investment strategies or strong performance in market-listed assets