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Financial Analysis of Rossell India Limited Q4 FY2023-24 Results

Financial Overview

1. Revenue Growth:

   • Q4 FY2023-24: Revenue from operations stood at ₹6,338 lakh, compared to ₹6,513 lakh in Q4 FY2022-23.
   • Full Year FY2023-24: Revenue from operations totaled ₹35,864 lakh, a marginal increase from ₹34,868 lakh in FY2022-23.

2. Profitability:

   • Quarterly Performance: A loss before tax of ₹1,745 lakh was reported in Q4 FY2023-24 compared to a loss of ₹1,691 lakh in Q4 FY2022-23.
   • Annual Performance: The company reported a profit before tax of ₹1,526 lakh for FY2023-24, down from ₹3,124 lakh in the previous fiscal year.

3. Expenses:

   • Cost of Materials: The cost of materials consumed increased to ₹10,879 lakh for the full year FY2023-24 from ₹8,722 lakh in the previous year.
   • Employee Benefits: Employee benefits expense rose to ₹14,254 lakh in FY2023-24, compared to ₹13,692 lakh in FY2022-23.
   • Finance Costs: Finance costs increased to ₹1,423 lakh for the year, compared to ₹1,178 lakh in the previous year.

4. Exceptional Items:

   • The company incurred ₹50 lakh in expenses related to the demerger process during FY2023-24.

5. Dividend:

   • A dividend of ₹0.30 per fully paid-up equity share of ₹2 each (15%) was recommended for FY2023-24, down from 20% in the previous year.

Operational Highlights

1. Segment Performance:

   • Tea Segment: The tea segment saw a reduction in revenue, contributing to the overall decline in quarterly revenue.
   • Aerospace and Defense: Continued focus on long-term agreements and new project acquisitions in the aerospace and defense sectors.

2. Inventory Management:

   • Inventories increased to ₹18,165 lakh at the end of FY2023-24 from ₹15,168 lakh at the end of FY2022-23, indicating a buildup of stock possibly due to anticipated future sales.

3. Debt Levels:

   • Total borrowings were ₹19,402 lakh at the end of FY2023-24, compared to ₹16,161 lakh at the end of the previous fiscal year, reflecting an increase in debt to support operational and investment activities.

Sector Insights

1. Tea Industry:

   • The tea industry faced challenges due to fluctuating prices and increased input costs.
   • Rossell India Limited’s performance in the tea segment was impacted by these industry-wide issues.

2. Aerospace and Defense:

   • The aerospace and defense sectors showed potential for growth with new long-term agreements and project acquisitions.
   • Strategic investments and collaborations are expected to yield positive outcomes in the coming years.

Business Strategy

1. Diversification:

   • The company is diversifying its portfolio to mitigate risks associated with dependence on any single segment.
   • Focus on expanding in aerospace and defense sectors to balance the traditionally strong tea segment.

2. Cost Management:

   • Implementation of cost management strategies to improve margins and operational efficiency.
   • Continued investment in R&D to develop innovative products and solutions.

3. Sustainability Initiatives:

   • Commitment to sustainable practices aligning with industry trends and regulatory requirements.
   • Focus on long-term value creation through environmentally friendly operations.

Customer and Product Focus

1. Customer Base:

   • Efforts to expand and diversify the customer base, particularly in the aerospace and defense sectors.
   • Strong relationships with existing customers to ensure repeat business and long-term partnerships.

2. Product Development:

   • Investment in developing new products and first articles to meet the needs of multinational corporations in the aerospace sector.
   • Introduction of innovative solutions and products to stay competitive in the market.

Conclusion

Rossell India Limited faced a challenging FY2023-24 with a decline in profitability despite slight revenue growth. The company is strategically diversifying its portfolio, focusing on cost management, and investing in sustainable practices to ensure long-term growth. While the tea segment faced industry-wide challenges, the aerospace and defense sectors showed promise with new agreements and projects. The company’s commitment to innovation and sustainability positions it well for future opportunities.

This detailed analysis highlights the financial, operational, sector-wise, business, customer, and product-related aspects of Rossell India Limited’s performance for the fourth quarter and full fiscal year 2023-24 .

I have noted all this point. Every business has dark sight. But it seems that there might be some turn around in the business. At 2013 – 15 company used to do a job work. But Now they have started building their own brand in the market it seems from the joint venture. You should keep a look on management guidance, if they met their guidence it’s going to be awesome. We have to keep a look in the company for this full financial year to see management is achieving their guidence or not.

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