Is Manika Plastech's Revenue Decline a Cause for Concern?
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Synopsis
Manika Plastech Limited has faced a significant drop in revenue and total income for FY24, raising questions about its financial health as it prepares for an IPO. Despite some growth in profit after tax, the company's rising debts and declining revenues leave investors with much to ponder.
Key Takeaways
- Revenue declined by over 9% in FY24.
- Total income fell by 7.61% in FY24.
- Profit after tax increased slightly by 1.76%.
- Borrowings increased compared to the previous year.
- IPO will involve fresh issues and an offer for sale.
Mumbai, July 3 (NationPress) Manika Plastech Limited, which has recently filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO), has reported a revenue decline exceeding 9 percent for the financial year ending March 31, 2024 (FY24).
The company's revenue from operations was recorded at Rs 360.7 crore in FY24, a drop from Rs 396.5 crore in FY23, as stated in the DRHP.
In conjunction, the total income of the company fell by 7.61 percent to Rs 368.7 crore in FY24, down from Rs 399.1 crore in FY23.
Moreover, the company's borrowings saw a notable increase, with the closing balance of borrowings for FY24 at Rs 62.6 crore, compared to Rs 68 crore in FY23.
Despite these challenges, the company achieved a slight increase in profit after tax (PAT), which rose by 1.76 percent to Rs 11.5 crore in FY24, up from Rs 11.3 crore in the previous year.
The total expenses for the company decreased by nearly 8 percent, resulting in a total of Rs 352.2 crore in FY24, down from Rs 383.1 crore in FY23.
For the nine-month period ending December 31, 2024, the revenue from operations was reported at Rs 295.5 crore.
The net profit for the Mumbai-based rigid polymer packaging entity during the same period was Rs 11.6 crore.
Manika Plastech's upcoming IPO will include both a fresh issue and an offer for sale (OFS), with plans to offer up to 1.5 crore equity shares at a face value of Rs 2 each.
One of the promoters, VRIDAA Holding Trust, will be reducing its stake through the OFS route.
Pantomath Capital Advisors Private Limited is the lead manager for this issue, and MUFG Intime India has been designated as the registrar.
The company plans to list its shares on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).
Established in April 1996 as Manika Moulds Private Limited under the Companies Act of 1956, Manika Plastech specializes in the plastic moulding sector.
Point of View
It is crucial to recognize the mixed signals from Manika Plastech's latest financial report. While the company shows resilience with a modest profit increase, the overall drop in revenue and rising debt warrants a cautious approach from potential investors. Our commitment is to provide an unbiased view based on the latest data.
NationPress
03/07/2025
Frequently Asked Questions
What is the revenue decline percentage for Manika Plastech?
Manika Plastech reported a revenue decline of more than 9 percent for FY24.
What is the total income of Manika Plastech for FY24?
The total income for FY24 was Rs 368.7 crore, down from Rs 399.1 crore in FY23.
What is the planned equity share offering in the IPO?
The IPO will consist of up to 1.5 crore equity shares with a face value of Rs 2 each.
Who is managing the IPO for Manika Plastech?
Pantomath Capital Advisors Private Limited is the lead manager for the IPO.
When was Manika Plastech established?
Manika Plastech was established in April 1996.
