Is the trade receivables are that risky ?
A comparison of PAT v/s net cash operating activities
Kitex Garments 2019 2020 2021 2022 2023 2024 Total
PAT 71 103 54 124 57 56 465
CASH from operatiions 9 51 116 -10 295 -38 423
Based on the data, I don’t see any significant red flags suggesting profit manipulation, except for an investment in Kitex USA LLC, an associate company, amounting to ₹27 crore, which has impairment triggers but has not been written off in the books.
However, I don’t believe this sum poses a serious threat to the company’s existence or its ability to continue as a going concern.
Additionally, a review of their trade receivables shows that they are within a reasonable range, further supporting the stability of their financial position.
Disc - Sleeping investor from 150 - 200 range
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