OPERATIONS
You should read the following discussion in conjunction with our restated financial statements attached in the chapter titled "Financial Information of the Company" beginning on page 164. You should also read the section titled "Risk Factors" on page 26 and the section titled "Forward Looking Statements" on page 18 of this Draft Red Herring Prospectus, which discusses a number of factors and contingencies that could affect our financial condition and results of operations. The following discussion relates to us, and, unless otherwise stated or the context requires otherwise, is based on our Restated financial Statements. Our financial statements have been prepared in accordance with Indian GAAP, the Companies Act and the SEBI (ICDR) Regulations and restated as described in the report of our auditor dated June 16, 2025 which is included in this Draft Red Herring Prospectus under "Financial Statements". The Restated Financial Information has been prepared on a basis that differs in certain material respects from generally accepted accounting principles in other jurisdictions, including US GAAP and IFRS. Our financial year ends on March 31 of each year, and all references to a particular financial year are to the twelve-month period ended March 31 of that year.
BUSINESS OVERVIEW
We are engaged in the manufacturing of rotational molding (roto molding) compounds, which serve as a key raw material for producing a wide range of hollow plastic products through the rotational molding process. Our product portfolio primarily comprises customized polyethylene-based compounds, formulated using Linear Low-Density Polyethylene (LLDPE), High- Density Polyethylene (HDPE), and other specialty additives. These compounds are supplied in powder or granulated form to rotational molding manufacturers, enabling them to produce durable and application-specific plastic products across diverse end-use industries.
Roto molding compounds form a critical input in the manufacturing of plastic products such as water, fuel and chemical storage tanks, portable sanitation units, furniture, industrial containers, and other customized hollow plastic parts. Our manufacturing process involves blending, pelletizing and pulverization, followed by quality control to ensure uniform particle size, optimal melt flow, and consistent performance in end-use applications.
We cater to a diverse base of customers across various industries such as building and construction, water management, agriculture, automotive, and consumer products etc. Our formulation and manufacturing capabilities enable us to deliver foam compound, stone effect, flame-retardant, anti-static and custom-colored compound depending on client needs. Additionally, we also undertake the production of custom-moulded tanks catering to diverse end-use applications. Further, we provide jobwork services such as rotolining (internal lining of tanks and equipment for enhanced chemical resistance and durability) and toll pulverising (custom grinding of polymers into powder form as per client specifications). Our manufacturing facility is situated at Gat No-172, Khatwad, Tal - Dindori, Dist - Nashik, Maharashtra, India-422004.
Our facility has its own laboratory and a quality control department that adheres to safety standards. We are an "ISO 9001:2015 - Quality Management System" certified company and also recognized as a One Star Export House by the Ministry of Commerce and Industry, in recognition of our consistent export performance. Our company is also a member of "The Plastics Export Promotion Council" (PLEXCONCIL), established under Foreign Trade Policy 2009-14 by the Department of Commerce.
We are exporting to countries like: Bahrain, Bangladesh, Cameroon, Guinea, Guinea-Bissau, Iraq, Kuwait, Lithuania, Mauritius, Nepal, Nigeria, Oman, Poland, Russia, Saint Lucia, Saudi Arabia, Slovenia, South Africa, Taiwan, Thailand, Turkey and U.A.E. etc.
We also generate revenue from distribution of various products and chemicals used in rotational moulding industry. We are authorized distributor of specific type of chemicals and compounds like: paints and coatings imported from UK, Polypropylene Compound imported from Thailand and speciality release agents imported from USA. Similarly we are authorized distributor of various tools and equipment used in rotational moulding industry like: Rotational Moulding process control equipment imported from Northern Ireland, plastic welding machine imported from Canada and Flash-It Ancillary Tools imported from Derbyshire, UK.
Our revenue from operations from manufacturing, services and trading activities in the last three financial year is as under:
(Rs. In lakhs)
Particulars |
2024-25 | % of total sales | 2023-24 | % of total sales | 2022-23 | % of total sales |
Manufacturing |
4,878.30 | 96.98% | 4,454.73 | 94.84% | 4,154.79 | 98.29% |
Services |
38.50 | 0.77% | 11.97 | 0.25% | 13.90 | 0.33% |
Trading |
113.52 | 2.26% | 230.23 | 4.90% | 58.36 | 1.38% |
Total |
5030.32 | 100.00% | 4696.93 | 100.00% | 4227.05 | 100.00% |
Our Company is led by our Promoter, Umakant Savadekar who hold the degree of Bachelor of Engineering (Mechanical Engineering) and Master of Technology (Nano science & Technology) with an overall work experience of around 20 years in the rotational moulding industry. Our experience and exposure in the roto moulding industry allow us to deal with various types of formulation widely used in various end use applications.
Key Performance Indicators of our Company
( Rs. In Lakhs except percentages and ratios)
Key Financial Performance |
FY 2024-25 | FY 2023-24 | FY 2022-23 |
Revenue from operations™ |
5030.32 | 4696.93 | 4227.05 |
EBITDA(2) |
436.87 | 275.78 | 184.34 |
EBITDA Margin(3) |
8.68% | 5.87% | 4.36% |
PAT(4) |
284.17 | 169.39 | 131.58 |
PAT Margin(5) |
5.65% | 3.61% | 3.11% |
Net Worth(6) |
969.93 | 685.76 | 516.37 |
RoNW(%)(7) |
29.30% | 24.70% | 25.48% |
RoCE (%)(8) |
31.99% | 23.27% | 23.56% |
Notes:
(1)
Revenue from Operations means the Revenue from Operations as appearing in the Restated Financial Statements(2)
‘EBITDA is calculated as Profit before tax + Depreciation + Interest Expenses - Other Income(3)
‘EBITDA Margin is calculated as EBITDA divided by Revenue from Operations(4)
‘PAT is calculated as Profit before tax - Tax Expenses.(5)
‘PAT Margin is calculated as Restated Profit after tax for the period/year divided by revenue from operations.(6)
‘Net worth means Equity share capital + Reserves and surplus (including, Securities Premium, General Reserve and surplus in statement of profit and loss).(7)
‘Return on Net Worth is ratio of Restated Profit after Tax and Net Worth.(8)
‘Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders equity plus total borrowings {current & non-current.STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
For details in respect of "Statement of Significant Accounting Policies", please refer to Annexure IV of Restated Financial Statements beginning on page 174 of this Red Herring Prospectus.
Factors Affecting our Results of Operations
1. General economic and business conditions in the markets in which we operate and in the local, regional, national and international economies;
2. Reliance on our key customers;
3. Changes in demand or market trends for roto moulding compounds and related products;
4. Fluctuations in the cost and availability of raw materials;
5. Adverse changes in domestic or global economic conditions;
6. Competition from existing or new players with greater financial or technological resources;
7. Delays or disruptions in our supply chain or distribution network;
8. Operational risks at our manufacturing facilities, including equipment failures, safety incidents, or compliance lapses;
9. Foreign exchange rate fluctuations impacting exports or imported inputs;
10. Changes in customer preferences or technological advancements that could affect product demand;
11. Any force majeure events, including natural disasters, pandemics, or geopolitical developments.
12. Changes in laws and regulations that apply to the industries in which we operate;
13. Failure to comply with quality standards may lead to cancellation of existing and future orders;
14. General economic, political and other risks that are out of our control;
15. Inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices;
16. Companys ability to successfully implement its growth strategy and expansion plans;
17. Occurrence of Environmental Problems & Uninsured Losses;
18. Concentration of ownership among our Promoters
Discussion on Result of Operations
The following discussion on results of operations should be read in conjunction with the Restated Financial Statements for the financial years ended on March 31, 2025, March 31, 2024 and March 31, 2023.
( Rs. in Lakhs)
Particulars |
March 31, 2025 | % of Total Income | March 31, 2024 | % of Total Income | March 31, 2023 | % of Total Income |
Revenue from Operations |
5,030.32 | 98.42% | 4,696.93 | 98.70% | 4,227.05 | 97.88% |
Other Incomes |
81.01 | 1.58% | 61.84 | 1.30% | 91.62 | 2.12% |
Total Income (I+II) |
5,111.33 | 100.00% | 4,758.76 | 100.00% | 4,318.67 | 100.00% |
Expenses: |
||||||
(a) Cost of Material Consumed |
3,976.13 | 77.79% | 3,521.95 | 74.01% | 3,548.80 | 82.17% |
(b) Purchase of Stock-in-Trade |
136.15 | 2.66% | 300.96 | 6.32% | 48.51 | 1.12% |
(c) Changes in inventories of finished goods work-inprogress and Stock-in-Trade |
-182.22 | -3.57% | 3.58 | 0.08% | -99.05 | -2.29% |
(d) Employee Benefits Expenses |
122.88 | 2.40% | 101.03 | 2.12% | 74.48 | 1.72% |
(e) Finance Costs |
88.23 | 1.73% | 62.44 | 1.31% | 60.74 | 1.41% |
(f) Depreciation and Amortization Expense |
49.83 | 0.97% | 40.33 | 0.85% | 32.64 | 0.76% |
(g) Other Expenses |
542.30 | 10.61% | 492.14 | 10.34% | 469.40 | 10.87% |
Total Expenses (IV) |
4,733.28 | 92.60% | 4,522.42 | 95.03% | 4,135.53 | 95.76% |
Profit before Exceptional/ Extraordinary items and tax (I-IV) |
378.05 | 7.40% | 236.34 | 4.97% | 183.14 | 4.24% |
Exceptional Items |
3.50 | 0.07% | 0.00 | 0.00% | 0.00 | 0.00% |
Profit before Extraordinary Items and tax (V-VI) |
381.55 | 7.46% | 236.34 | 4.97% | 183.14 | 4.24% |
Extraordinary Items |
0.00 | 0.00% | 0.00 | 0.00% | 0.00 | 0.00% |
Profit before tax (VII-VIII) |
381.55 | 7.46% | 236.34 | 4.97% | 183.14 | 4.24% |
Tax Expense |
||||||
a) Current Tax |
93.83 | 1.84% | 62.27 | 1.31% | 50.07 | 1.16% |
b) Deferred Tax |
3.55 | 0.07% | 4.68 | 0.10% | 1.49 | 0.03% |
Restated profit after tax for the period from continuing operations (IX-X) |
284.17 | 5.56% | 169.39 | 3.56% | 131.58 | 3.05% |
Profit/ (Loss) from Discontinuing operation |
0.00 | 0.00% | 0.00 | 0.00% | 0.00 | 0.00% |
Tax expenses of discontinuing operations |
0.00 | 0.00% | 0.00 | 0.00% | 0.00 | 0.00% |
Profit/(loss) from Discontinued operations (after tax) (XII-XIII) |
0.00 | 0.00% | 0.00 | 0.00% | 0.00 | 0.00% |
Restated Profit for the Period |
284.17 | 5.56% | 169.39 | 3.56% | 131.58 | 3.05% |
Revenue from operations:
Revenue from operations mainly consists of revenue from sale of products and sale of services.
Other Incomes
Other income comprises of Interest Income, Subsidies & Grants, Export Incentives, Foreign Exchange Fluctuation, Dividend Income and Other Incomes
Total Expenses:
Total expenses consist of Cost of Material Consumed, Purchases of Stock in Trade, Changes in inventories of finished goods work-in-progress and Stock-in-Trade, Employee benefits expense, Finance costs, Depreciation and amortization expenses and other expenses.
Cost of Material Consumed
The Cost of Material Consumed comprises of Raw Material Purchase During the Year, Raw material at the Commencement and end of the Year.
Purchase of stock in trade
Purchase of stock in trade primarily comprises of Purchases of goods.
Change in inventories of stock in trade
Change in inventories of stock in trade comprises of increase/ (decrease) in inventory of Finished Goods, Trading Goods, Packing Material and Scrap Material.
Employee benefits expense:
Employee benefits expense primarily comprises of Salary and Wages, Director Remuneration, Contribution to Provident and Other Fund and provision for gratuity.
Finance Costs:
Our Finance cost includes Interest expenses and Other borrowing cost.
Depreciation and Amortization Expenses:
Depreciation and Amortization Expenses includes depreciation on Office & Factory Building, Plant & Machinery, Electrical Equipments and Fittings, Furnitures & Fixtures, Office Equipments, Roads, Motor Vehicles, Water Pipeline Works and Computers
Other Expenses:
Other Expenses comprises of Power & Fuel, Job Work Charges, Testing Expenses, Consumables & Spares, Insurance Expenses, Carriage Inwards, Custom Duties, Technical Consultancy Expenses, Import Handing Charges, Other Charges, Exhibition Expenses, Export Freight & Handling Charges, Office Expenses, Rent Charges, Rates & Taxes, Payment to Auditors, Telephone & Internet Expenses, Printing and Stationery, Travelling & Local Conveyance, Postage & Courier Expenses, Membership & Sponsorship Charges, Licence and Application Fees, Repairs & Maintenance Expenses, Bank Charges, Taxes & Demands, Bad Debts Written Off and Other Misc Expenses etc.
FINANCIAL YEAR 2025 COMPARED TO FINANCIAL YEAR 2024 Total Income:
The Total Income increased from FY 24 to FY 25, driven by an improvement in Revenue from Operations and Other Income. Revenue from Operations grew by 7.10%, rising from Rs.4696.93 lakhs in FY 24 to Rs. 5030.32 lakhs in FY 25 along with Other Income which grew by 31.00%, increasing from Rs.61.84 lakhs in FY 24 to Rs.81.01 lakhs in FY 25. This overall growth reflects the companys operational performance during the year.
Revenue from Operations
During the financial year 2024-25, the revenue from operations of the Company reported a sales growth of 7.10%, primarily driven by a 6.55% increase in product sales. The product sales were largely attributable to rise in manufactured product sales. The growth in manufactured sales was supported by increase in demand for roto moulding compounds and Custom Molded Tanks, which grew by 9.68% and 4.91% respectively. Additionally, the Company also derived increased revenue from sale of services which rose by 221.71%, mainly driven by growth in Toll Pulverising and Rotolining Services, which increased by 66.59% and 50.00%, respectively.
Other Income:
During the financial year 2024-25, the other income of the Company increased by 31.00%, from Rs.61.84 lakhs in FY 2023-24 to Rs.81.01 lakhs in FY 2024-25. This increase was due to a increase in Interest on deposit increased by 66.86% from Rs.3.26 lakhs in FY 2023-24 to Rs.5.43 lakhs in FY 2024-25, Export Incentive increased by 26.69% from Rs.14.33 lakhs in FY 2023-24 to Rs.18.15 lakhs in FY 2024-25, Foreign exchange fluctuation increased by 232.51% from Rs.3.91 lakhs in FY 2023-24 to Rs.12.99 lakhs in FY 2024-25 and Other income increased by 412.83% from Rs.0.99 lakhs in FY 2023-24 to Rs.5.08 lakhs in FY 2024-25.
Total Expenses
The total expense for the financial year 2024-25 increases to Rs.4733.28 Lakhs from Rs.4522.42 lakhs in the Financial Year 202324 representing an increase of 4.66%. Such increase was due to increases in the volume of business operations of the Company.
Cost of Material Consumed
The Cost of Material Consumed comprises of Raw Material Purchase During the Year, Raw material at the Commencement and end of the Year. The Cost of Material Consumed for the financial year 2024-25 increases to Rs.3976.13 Lakhs from Rs.3521.95 lakhs in the Financial Year 2023-24 representing an increase of 12.90%. This increase was due to a rise in opening stock of raw material which increased by 29.23% from 1169.18 lakhs in FY 2023-24 to Rs.218.64 lakhs in FY 2024-25, material purchase during the year increased by 11.10% from Rs.3571.40 lakhs in FY 2023-24 to Rs.3967.85 lakhs in FY 2024-25 and closing stock of raw material decreased by 3.78% from Rs.218.64 lakhs in FY 2023-24 to Rs.210.36 lakhs in FY 2024-25.
Purchases of Stock in Trade
The Purchase of stock in trade for the financial year 2024-25 decreases to Rs.136.15 lakhs from Rs.300.96 lakhs in the Financial Year 2023-24 representing an decrease of 54.76%. Such decrease was due to decrease in the volume of stock in trade.
Change in inventories of stock in trade
The Change in inventories of stock in trade comprises of increase/(decrease) in inventory of Finished Goods, Trading Goods, Packing Material and Scrap Material used in business operations. The Change in inventories of stock in trade for the financial year 2024-25 decrease to Rs.(182.22) Lakhs from Rs.3.58 lakhs in the Financial Year 2023-24 representing an decrease of 5195.62%. This decrease was due to a rise in the closing inventories of Finished Goods, Trading Goods, Packing Material and Scrap Material which increased by 123.40%, 27.50%, 80.39% and 59.66% respectively from ^ 119.73 lakhs, Rs.95.70 lakhs, Rs.5.29 lakhs and Rs.6.54 lakhs respectively in the Financial Year 2023-24 to Rs.267.49 lakhs, Rs.122.02 lakhs, Rs.9.54 lakhs and Rs.10.43 lakhs respectively in Financial Year 2024-25.
Employee benefits expense:
During the financial year 2024-25, the total Employee Benefits Expenses of the Company increased by 21.63%, from Rs.101.03 lakhs in FY 2023-24 to Rs.122.88 lakhs in FY 2024-25. This increase was due to increase in Salaries and Wages increased by 28.99% from Rs.62.94 lakhs in FY 2023-24 to Rs.81.19 lakhs in FY 2024-25, Contribution to Provident and Other Funds increased by 21.08%, increasing from Rs.6.02 lakhs in FY 2023-24 to Rs.7.29 lakhs in FY 2024-25 and Provision for Gratuity increased by 113.52%, from Rs.2.06 lakhs in FY 2023-24 to Rs.4.40 lakhs in FY 2024-25.
Finance Costs:
During the financial year 2024-25, the Finance cost of the Company increased by 41.30%, from Rs.62.44 lakhs in FY 2023-24 to Rs.88.23 lakhs in FY 2024-25. This increase was due to increase in Interest on Borrowings by 2.53% from Rs.42.59 lakhs in FY
2023- 24 to Rs.43.67 lakhs in FY 2024-25, Interest on Statutory Dues increased by 14.16% from Rs.3.77 lakhs in FY 2023-24 to Rs.4.30 lakhs in FY 2024-25, Interest to Others increased by 177.15% from Rs.12.33 lakhs in FY 2023-24 to Rs.34.17 lakhs in FY
2024- 25, Interest on MSME Dues which was Nil in FY 2023-24 stood at Rs.2.19 lakhs in FY 2024-25 and Other Borrowing Costs - Others Charges increased by 15.73% from Rs.1.49 lakhs in FY 2023-24 to ^ 1.73 lakhs in FY 2024-25.
Depreciation and Amortization Expenses:
Depreciation for the financial year 2024-25 stood at Rs.49.83 Lakhs as against Rs.40.33 Lakhs during the financial year 2023-24. The increase in depreciation was around 23.55% which was majorly due to addition in Property, Plant and equipment during the year.
Other Expenses:
During the financial year 2024-25, the Other Expenses of the Company increased by 10.19%, from Rs.492.14 lakhs in FY 202324 to Rs.542.30 lakhs in FY 2024-25. This increase was due to increase in Power & Fuel by 14.58% from Rs.209.90 lakhs in FY
2023- 24 to Rs.240.51 lakhs in FY 2024-25, Testing Expenses increased by 122.54% from Rs.0.25 lakhs in FY 2023-24 to Rs.0.55 lakhs in FY 2024-25, Consumables & Spares increased by 10.06% from Rs.26.92 lakhs in FY 2023-24 to Rs.29.63 lakhs in FY
2024- 25, Carriage Inwards increased by 4.96% from Rs.57.96 lakhs in FY 2023-24 to Rs.60.83 lakhs in FY 2024-25, Other Charges increased by 5.72% from Rs.19.97 lakhs in FY 2023-24 to Rs.21.12 lakhs in FY 2024-25, Export Freight & Handling Charges increased by 57.15% from Rs.55.23 lakhs in FY 2023-24 to Rs.86.80 lakhs in FY 2024-25, Office Expenses increased by 64.06% from Rs.3.21 lakhs in FY 2023-24 to Rs.5.26 lakhs in FY 2024-25, Payment to Auditors increased by 126.99% from Rs.1.01 lakhs in FY 2023-24 to Rs.2.29 lakhs in FY 2024-25, Professional and Consulting Fees increased by 167.01% from Rs.7.65 lakhs in FY 2023-24 to Rs.20.43 lakhs in FY 2024-25, Printing and Stationery increased by 42.75% from Rs.2.14 lakhs in FY 2023-24 to Rs.3.05 lakhs in FY 2024-25, Other Miscellaneous Expenses increased by 319.56% from Rs.0.59 lakhs in FY 2023-24 to Rs.2.46 lakhs in FY 2024-25, License and Application Fees increased by 932.65% from Rs.0.14 lakhs in FY 2023-24 to Rs.1.40 lakhs in FY 202425, and Taxes & Demands increased by 25.58% from Rs.0.69 lakhs in FY 2023-24 to Rs.0.87 lakhs in FY 2024-25.
Exceptional Items
During FY 2024-25, the Company has recognised an exceptional item of income amounting to Rs.3.50 lakhs, representing a net impact of loss on account of fire damage to goods in export of Rs.77.48 lakhs, offset by an insurance claim of Rs.80.98 lakhs. This item is non-recurring in nature and not part of the ordinary course of business.
Restated Profit before tax:
Net profit before tax for the financial year 2024-25 increased to Rs.381.55 Lakhs as compared to profit of Rs.236.34 Lakhs in the financial year 2023-24. The increase of 61.44% was majorly due to factors as mentioned above.
Restated profit after tax:
Net profit after tax for the financial year 2024-25 increased to Rs.284.17 Lakhs as compared to profit of Rs. 169.39 Lakhs in the financial year 2023-24. The increase of 67.76% was due to factors increase in PAT margin. The PAT margin for the financial year 2023-24 was 3.61% and the same has increased to 5.65% in the financial year 2024-25.
FINANCIAL YEAR 2024 COMPARED TO FINANCIAL YEAR 2023 Total Income:
The Total Income increased from FY 23 to FY 24, driven by an improvement in Revenue from Operations. Revenue from Operations grew by 11.12%, rising from Rs. 4227.05 lakhs in FY 23 to Rs. 4696.93 lakhs in FY 24. However, Other Income showed a slight decline of 32.51%, decreasing from Rs. 91.62 lakhs in FY 23 to Rs. 61.84 lakhs in FY 24. This overall growth reflects the companys operational performance during the year.
Revenue from Operations
During the financial year 2023-24, the revenue from operations of the Company reported a sales growth of 11.12%, primarily driven by a 11.20% increase in product sales. The product sales growth was largely attributable to rise in manufactured product sales. The growth in manufactured sales was supported by increase in demand for roto moulding compounds and Custom Molded Tanks, which grew by 4.09% and 413.00% respectively. Additionally, the Company also derived increased revenue from trading sales which rose by 294.49%. The growth in trading sales was led by increase in demand for Polypropylene Compound, which grew by 182.05%, Paints, Coatings and Other Auxiliary Products, which increased by 132.58%.
Other Income:
During the financial year 2023-24, the other income of the Company decreased by 32.51%, from Rs. 91.62 lakhs in FY 202223 to Rs. 61.84 lakhs in FY 2023-24. This decline was due to a decrease in foreign exchange fluctuation decreased by 85.34% from Rs. 26.64 lakhs in FY 2022-23 to Rs. 3.91 lakhs in FY 2023-24, Other incomes decreased by 83.93% from Rs. 6.16 lakhs in FY 2022-23 to Rs. 0.99 lakhs in FY 2023-24, Subsidies and grants decreased by 18.41% from Rs. 48.18 lakhs in FY 202223 to Rs. 39.31 lakhs in FY 2023-24,
Total Expenses
The total expense for the financial year 2023-24 increases to Rs. 4522.42 Lakhs from Rs. 4135.53 lakhs in the Financial Year
2022- 23 representing a increase of 9.36%. Such increase was due to increases in the volume of business operations of the Company.
Cost of Material Consumed
The Cost of Material Consumed comprises of Raw Material purchase During the Year, Raw material at the Commencement and end of the Year. The Cost of Material Consumed for the financial year 2023-24 decreases to t3521.95 Lakhs from t3548.80 lakhs in the Financial Year 2022-23 representing a decrease of 0.76%. This decrease was due to a increase in closing stock of raw material which increased by 29.23% from t169.18 lakhs in FY 2022-23 to t218.64 lakhs in FY 2023-24 and due to decrease in Raw material purchase during the year decreased by 1.60% from t3629.63 lakhs in FY 2022-23 to t3571.40 lakhs in FY2023- 24.
Purchases of Stock in Trade
The Purchase of stock in trade for the financial year 2023-24 increases to Rs. 300.96 lakhs from Rs. 48.51 lakhs in the Financial Year 2022-23 representing a increase of 520.42%. Such increase was due to increases in the volume of stock in trade.
Change in inventories of stock in trade
The Change in inventories of stock in trade comprises of increase/(decrease) in inventory of Finished Goods, Trading Goods, Packing Material and Scrap Material used in business operations. The Change in inventories of stock in trade for the financial year 2023-24 increase to t3.58 Lakhs from t (99.05) lakhs in the Financial Year 2022-23 representing an increase of 103.61%. This increase was due to a Increase in the opening inventories of Finished Goods, Packing Material and Scrap Material which increased by 100.51%, 58.83% and 93.17% from t102.83 lakhs t2.57 lakhs and 11.55 lakhs respectively in the Financial Year 2022-23 to t206.17 lakhs t4.11 lakhs and t3.00 lakhs respectively in Financial Year 2023-24.
Employee benefits expense:
During the financial year 2023-24, the total Employee Benefits Expenses of the Company increased by 35.64%, from Rs.74.48 lakhs in FY 2022-23 to Rs.101.03 lakhs in FY 2023-24. This increase was due to increase in Salaries and Wages increased by 35.30% from Rs.46.52 lakhs in FY 2022-23 to Rs.62.94 lakhs in FY 2023-24, Directors Remuneration increased by 65.56% from Rs.18.12 lakhs in FY 2022-23 to Rs.30.00 lakhs in FY 2023-24 and Contribution to Provident and Other Funds increased by 142.33%, from Rs.2.49 lakhs in FY 2022-23 to Rs.6.02 lakhs in FY 2023-24.
Finance Costs:
During the financial year 2023-24, the total Finance Costs of the Company increased by 2.79%, from Rs.60.74 lakhs in FY 202223 to Rs.62.44 lakhs in FY 2023-24. This increase was due to increase in Interest on Borrowings by 5.02% from Rs.40.56 lakhs in FY 2022-23 to Rs.42.59 lakhs in FY 2023-24, Interest on Statutory Dues increased by 108.21% from Rs.1.81 lakhs in FY 2022-23 to Rs.3.77 lakhs in FY 2023-24, Invoice Discounting Charges increased by 157.99% from Rs.0.88 lakhs in FY 2022-23 to Rs.2.26 lakhs in FY 2023-24, and Other Borrowing Costs - Others Charges increased by 164.76% from Rs.0.56 lakhs in FY 2022-23 to Rs.1.49 lakhs in FY 2023-24.
Depreciation and Amortization Expenses:
Depreciation for the financial year 2023-24 stood at Rs. 40.33 Lakhs as against Rs. 32.64 Lakhs during the financial year 202223. The increase in depreciation was around 23.55% which was majorly due to addition in Property, Plant and equipment.
Other Expenses:
During the financial year 2023-24, the Other Expenses of the Company increased by 4.85%, from Rs.469.40 lakhs in FY 202223 to Rs.492.14 lakhs in FY 2023-24. This increase was due to increase in Power & Fuel by 31.97% from 1159.06 lakhs in FY
2022- 23 to Rs.209.90 lakhs in FY 2023-24, Job Work Charges increased by 208.14% from Rs.6.72 lakhs in FY 2022-23 to Rs.20.70 lakhs in FY 2023-24, Factory Insurance Expenses increased by 17.22% from Rs.1.65 lakhs in FY 2022-23 to Rs.1.94 lakhs in FY
2023- 24, Carriage Inwards increased by 8.92% from Rs.53.21 lakhs in FY 2022-23 to Rs.57.96 lakhs in FY 2023-24, Custom Duties increased by 36.98% from Rs.11.17 lakhs in FY 2022-23 to Rs.15.31 lakhs in FY 2023-24, Exhibition Expenses increased by 33.67% from Rs.5.85 lakhs in FY 2022-23 to Rs.7.82 lakhs in FY 2023-24, Export Insurance & Other Charges increased by 61.69% from Rs.8.32 lakhs in FY 2022-23 to Rs.13.45 lakhs in FY 2023-24, Office Expenses increased by 149.59% from Rs.1.29 lakhs in FY 2022-23 to Rs.3.21 lakhs in FY 2023-24, Payment to Auditors increased by 28.70% from Rs.0.78 lakhs in FY 202223 to Rs.1.01 lakhs in FY 2023-24, Telephone & Internet Expenses increased by 73.91% from Rs.1.92 lakhs in FY 2022-23 to Rs.3.34 lakhs in FY 2023-24, Travelling & Local Conveyance increased by 15.63% from Rs.3.93 lakhs in FY 2022-23 to Rs.4.54 lakhs in FY 2023-24, Insurance Charges increased by 31.34% from Rs.2.42 lakhs in FY 2022-23 to Rs.3.18 lakhs in FY 2023-24, Membership & Sponsorship Charges increased by 596.23% from Rs.0.31 lakhs in FY 2022-23 to Rs.2.15 lakhs in FY 2023-24, Other Miscellaneous Expenses increased by 140.40% from Rs.0.24 lakhs in FY 2022-23 to Rs.0.59 lakhs in FY 2023-24, Repairs & Maintenance Expenses - Machinery increased by 15.10% from Rs.1.02 lakhs in FY 2022-23 to Rs.1.17 lakhs in FY 2023-24, and Bad Debts Written Off increased by 19742.37% from Rs.0.11 lakhs in FY 2022-23 to Rs.21.54 lakhs in FY 2023-24.
Restated Profit before tax:
Net profit before tax for the financial year 2023-24 increased to Rs. 236.34 Lakhs as compared to profit of Rs. 183.14 Lakhs in the financial year 2022-23. The increase of 29.05% was majorly due to factors as mentioned above.
Restated profit after tax:
Net profit after tax for the financial year 2023-24 increased to Rs. 169.39 Lakhs as compared to profit of Rs. 131.58 Lakhs in the financial year 2022-23. The increase of 28.73% was due to factors increase in PAT margin. The PAT margin for the financial year 2022-23 was 3.11% and the same has increased to 3.61% in the financial year 2023-24.
Information required as per Item (II)(C)(iv) of Part A of Schedule VI to the SEBI Regulations:
An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:
1. Unusual or infrequent events or transactions
There has not been any unusual trend on account of our business activity. Except as disclosed in this Draft Red Herring Prospectus, there are no unusual or infrequent events or transactions in our Company.
2. Significant economic changes that materially affected or are likely to affect income from continuing operations.
There are no significant economic changes that may materially affect or likely to affect income from continuing operations.
3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations.
Apart from the risks as disclosed under Section "Risk Factors" beginning on page 26 of the Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.
4. Future changes in relationship between costs and revenues
Other than as described in the sections "Risk Factors", "Our Business" and "Managements Discussion and Analysis of Financial Condition and Results of Operations" on pages 26, 106 and 228 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.
5. Segment Reporting
Our business activity primarily falls within a single business segment and therefore we do not follow any other segment reporting
6. Status of any publicly announced New Products or Business Segment
Except as disclosed in the Chapter "Our Business", our Company has not announced any new product or service.
7. Seasonality of business
For Seasonality of business, see "Industry Overview" and "Our Business" on pages 93 and 106, respectively of this Draft Red Herring Prospectus.
8. Dependence on single or few customers
During the Fiscal 2025, Fiscal 2024 and Fiscal 2023, our top 10 customers contributed approximately 49.30%, 50.83% and 50.88% our revenue from operations respectively.
9. Competitive conditions
Competitive conditions are as described under the Chapters "Industry Overview" and "Our Business beginning on pages 93 and 106 respectively of this Draft Red Herring Prospectus.
10. Details of material developments after the date of last balance sheet i.e., March 31, 2025
After the date of last Balance sheet i.e. March 31, 2025, the following material events have occurred:
1. The shareholders of the Company, in their Extraordinary General Meeting held on August 2, 2025, approved the conversion of the Company from a Private Limited Company to a Public Limited Company and accordingly, the Company was converted into a Public Limited Company and consequently the name of the Company was changed from "Phychem Technologies Private Limited" to "Phychem Technologies Limited" vide a fresh certificate of incorporation consequent upon conversion from private company to public company dated 18 th August, 2025 issued by the Registrar of Companies, Mumbai, Maharashtra bearing CIN U36109MH2013PLC244466.
2. The Company has increased its authorised share capital from Rs.31 lakhs comprising 3,10,000 equity shares of Rs.10 each to Rs.1,500 lakhs comprising 1,50,00,000 equity shares of Rs.10 each, pursuant to a resolution passed by the shareholders at the Extraordinary General Meeting held on 30th August, 2025.
3. We have appointed Umakant Savadekar as Chairman and Managing Director, Ulka Umakant Savadekar as Whole time director & CFO, Nivrutti Sonu Savdekar as Non-Executive Director and Vijaya Nivrutti Savdekar as Non-Executive Director for a term of 3 years and Niranjan Ramakant Kolhe and Rajendra Hunajirao Talele as Independent Director of the Company for a term of 5 years with effect from August 30, 2025 vide a board resolution passed in the Board Meeting held on August 29, 2025 and confirmed by the shareholders vide a Special resolution in the Extra Ordinary General Meeting held on August 30, 2025.
4. We have appointed Pooja Sharma as Company Secretary with effect from September 19, 2025.
5. Company has issued bonus equity shares in the ratio of 25:1 in the Board Meeting dated September 20, 2025.
6. The Company has approved the Restated Financial Statements for the financial year ended March 31, 2025, March 31, 2024 and March 31, 2023 in the Board meeting dated September 20, 2025.
7. We have passed a Board resolution in the meeting of the Board of Directors held on September 24, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.
8. We have passed a special resolution in the Extra Ordinary General meeting held on September 24, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.
9. The Company has approved the Draft Red Herring Prospectus vide resolution in the Board Meeting dated September 30, 2025.
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