The Kailas Rubber Company Limited Annual Reports, Balance Sheet and Financials

The Kailas Rubber Company Limited Balance Sheet (Amount in Rs.)

The Kailas Rubber Company Limited Profit & Loss Statement (Amount in Rs.)

 The Kailas Rubber Company Limited Cash Flow Statement (Amount in Rs.)

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

Cash Flow from Operating Activities:

Profit before Extraordinary Items and Tax: The company reported a profit of Rs. 7.06 crore in FY 2023-24, an increase from Rs. 5.06 crore in FY 2022-23, showing improved profitability.

Adjustments to Profit/Loss:

Depreciation and Amortisation: There was an increase in depreciation and amortisation expense, from Rs. 3.31 crore in FY 2022-23 to Rs. 3.7 crore in FY 2023-24.

Dividend Income: Dividend income rose slightly to Rs. 17 lakh in FY 2023-24 compared to Rs. 15 lakh in the previous year.

Other Adjustments: Other adjustments, such as non-cash items, resulted in a negative adjustment of Rs. 1.11 crore in FY 2023-24, compared to Rs. 91 lakh in FY 2022-23.

Total adjustments resulted in an increase of Rs. 2.42 crore in FY 2023-24, compared to Rs. 2.25 crore in FY 2022-23.

Working Capital Adjustments:

Inventories: There was a decrease in inventories of Rs. 13.43 crore in FY 2023-24, a larger decrease compared to Rs. 4.39 crore in FY 2022-23.

Trade Receivables: Trade receivables decreased by Rs. 4.54 crore in FY 2023-24, while in FY 2022-23, they had increased by Rs. 4.02 crore, indicating improved collections.

Trade Payables: There was an increase in trade payables by Rs. 12.5 crore in FY 2023-24, compared to a smaller increase of Rs. 83 lakh in FY 2022-23.

Net Cash from Operating Activities: Despite positive operating profit and working capital adjustments, the company reported a negative net cash flow of Rs. 84 lakh in FY 2023-24, compared to a positive Rs. 5.15 crore in FY 2022-23. This is due to high interest and income tax payments.

Cash Flow from Investing Activities:

Proceeds from Sales of Tangible Assets: The company received Rs. 5.58 crore from the sale of assets in FY 2023-24, a significant increase from Rs. 1.33 crore in the prior year.

Purchase of Tangible Assets: Capital expenditure on tangible assets increased slightly to Rs. 7.93 crore in FY 2023-24 from Rs. 7.26 crore in FY 2022-23.

Dividend and Interest Received: Dividend income rose to Rs. 39 lakh in FY 2023-24 (compared to Rs. 15 lakh in FY 2022-23), and interest received increased to Rs. 1.36 crore, up from Rs. 64 lakh.

Other Cash Flows: There were some other outflows of Rs. 2.17 crore in FY 2023-24.

Net Cash Used in Investing Activities: The company spent a net Rs. 2.77 crore on investing activities in FY 2023-24, an improvement over the Rs. 6.94 crore outflow in FY 2022-23.

Cash Flow from Financing Activities:

Proceeds from Borrowings: The company raised Rs. 10.09 crore from borrowings in FY 2023-24, compared to repaying Rs. 1.15 crore in FY 2022-23.

Dividends Paid: The company paid Rs. 1.06 crore in dividends, up from Rs. 85 lakh in the previous year.

Interest Paid: Interest payments were Rs. 1.58 crore in FY 2023-24, compared to no interest payments in FY 2022-23.

Net Cash from Financing Activities: Financing activities generated Rs. 10.47 crore in FY 2023-24, compared to an outflow of Rs. 2 crore in the prior year.

Net Change in Cash and Cash Equivalents:

Net Increase in Cash: The company experienced a net increase of Rs. 6.86 crore in cash and cash equivalents in FY 2023-24, reversing the decrease of Rs. 3.79 crore in FY 2022-23.

Cash at End of Period: The closing balance of cash and cash equivalents was Rs. 11.72 crore in FY 2023-24, up from Rs. 4.86 crore in FY 2022-23, indicating improved liquidity.

 Financial Ratios of The Kailas Rubber Company Limited

Here is a summary of the financial and operational metrics for The Kailas Rubber Company Limited for the year 2024 and 2023:

Current Ratio:

The current ratio measures the company’s ability to cover its short-term liabilities with its short-term assets. A ratio above 1 indicates that the company can pay off its current obligations. In FY 2023-24, the ratio decreased to 1.73 from 2.19 in the previous year, indicating a slight reduction in the company’s short-term liquidity. This may suggest either a decrease in current assets or an increase in current liabilities, which could make the company slightly less liquid compared to the previous year.

Debt-Equity Ratio:

The debt-equity ratio indicates the proportion of debt used to finance the company 's assets relative to shareholders ' equity. A ratio of 1.92 in FY 2023-24 means that for every rupee of equity, the company has Rs. 1.92 in debt, up from Rs. 1.49 in FY 2022-23. The increase in this ratio suggests that the company has become more reliant on debt to finance its operations, which could lead to higher financial risk. A higher ratio may raise concerns regarding the company’s ability to service debt during difficult times.

Debt Service Coverage Ratio (DSCR):

The debt service coverage ratio (DSCR) measures a company 's ability to meet its debt obligations with its operating income. A ratio below 1 indicates that the company is not generating enough operating income to cover its debt service (interest and principal payments). In FY 2023-24, the DSCR decreased to 0.12 from 0.21 in FY 2022-23, signaling a worsening ability to service debt. This significant decline is concerning, as the company may struggle to meet its debt obligations without additional financing or restructuring.

Return on Equity (ROE):

Return on equity (ROE) measures how effectively the company uses shareholders’ equity to generate profit. In FY 2023-24, ROE increased sharply to 0.22 (or 22%) from 0.08 (8%) in FY 2022-23. This improvement indicates that the company is now generating more profit per unit of equity invested by shareholders, showing better profitability and effective management of equity capital.

Inventory Turnover Ratio:

The inventory turnover ratio measures how many times the company sells and replaces its inventory over a period. In FY 2023-24, the ratio decreased significantly to 27.68 from 56.35 in FY 2022-23, which may indicate that the company is taking longer to sell its inventory. This could be due to slower sales or overstocking of goods. A lower ratio is generally a sign of inefficiency in inventory management, though it could also reflect changes in business operations or market conditions.

Net Capital Turnover Ratio:

The net capital turnover ratio measures how efficiently the company uses its capital to generate sales. A ratio of 9.36 in FY 2023-24, slightly up from 9.01 in FY 2022-23, indicates that the company is using its capital effectively to generate revenue. The slight increase suggests that the company has improved its efficiency in utilizing its invested capital to drive sales.

Net Profit Ratio:

The net profit ratio measures the percentage of revenue that results in profit after all expenses. The ratio increased to 1.65% in FY 2023-24 from 1.4% in FY 2022-23, indicating a modest improvement in profitability. This suggests that the company was able to control its expenses better or achieved higher margins during the year, resulting in a higher proportion of revenue being converted into profit.

Return on Capital Employed (ROCE):

Return on capital employed (ROCE) measures a company’s ability to generate profits from its capital employed (equity + debt). The ROCE improved to 0.08 (or 8%) in FY 2023-24 from 0.04 (or 4%) in FY 2022-23, reflecting better capital efficiency. This increase indicates that the company has been more effective in utilizing both equity and borrowed funds to generate profits.

Return on Investments (ROI):

The return on investments (ROI) measures the return generated on investments relative to their cost. An increase to 0.16 (or 16%) in FY 2023-24 from 0.12 (or 12%) in FY 2022-23 suggests that the company’s investments have become more profitable. This could indicate better management of its investment portfolio or a higher return on the capital allocated to various investment activities.