SHILCHAR TECHNOLOGIES LIMITED is an Indian capital goods firm that manufactures powers and distributes transformers tailored to client specification it works on build-to-order model rather than stock-and-sell model. In FY24 it has utilized 100% of its capacity which is 4,000 MVA and plans to expand its production capacity to 7500 MVA in the future. The company has a 71.3% of Return on Capital Employed and a P/E ratio of 31.4 whereas the average P/E ratio of 39.3. The company began FY25 with an order book of ₹8.4 billion and expanded to ₹11.3 billion by year-end. Seeking the transformer industry’s growth management target 20-25% increase in sales for FY26.
Analysis of the Financial Statements
Revenue Growth Trend
The company has shown a remarkable CAGR of 54% in the past 5 years. Sales went from Rs 71 crores in 2020 to Rs 623 crores in in 2025. Company is utilizing its full capacity and expansion plan shared by the management prospects the same growth in the future. The company’s primary source of revenue is power and energy sectors, which constitute about 60% of the revenue and the management is planning to expand in the steel and cement industry. The top five domestic customers constitute to about 62% of the revenue in FY24.
March2020
March2021
March2022
March2023
March2024
March2025
71 CRORES
118 CRORES
180 CRORES
280 CRORES
397 CRORES
623 CRORES
Profitability & Margin Analysis
Operating profit margin has shown a sharp increase from 4% in March 2020 to 30% in March 2024. The management is very focused on cost efficiency. Seeing the company order book, expansion plans, client turnover ratio and Operating Profit Margin, the sales of the company will show a sharp increase in the future.
March2020
March2021
March2022
March2023
March2024
March2025
4%
8%
11%
19%
29%
30%
Balance Sheet Strength
The total assets of the company had increased approx. four folds in the past 5 years from Rs103 crores in 2020 to Rs 490 crores in 2025, but the major increase is due to the increase in trade receivables which became 6.94x in past 5 years but it can be justified as the sales went 8.77x in the past 5 years. Company ability to recover the debt is a major factor for the sustainability of the company.
Debt Profile
Company has been operating on no debt model for the past 3 years and all its investments are funded by the retained earnings of the company, which makes the balance sheet healthier than if it was debt driven. Reserves of the company as on March 2025 stand at Rs 339 Crores, enough to fund for its expansion. The company has been distributing dividends continuously for the past 10 years, the dividend yield of the company is 0.28%.
March2020
March2021
March2022
March2023
March2024
March2025
₹1.00
₹1.50
₹4.00
₹10.00
₹12.50
₹12.50
Cash Flow Health
The Cash from Operating Activity has been positive in the last 3 years. The cash conversion cycle for the company is 120 days which is close to the industry cash conversion cycle. Company is making heavy investments in the expansion plans which can be seen through the negative Cash from Investing Activity.
Analysis of the Company Management (Investors presentation/Disclosures-based view)
Recent conference calls highlighted:
Management is focused on the capacity expansion of the company and has a target of 7500 MVA of the manufacturing capacity.
Management is targeting to fully utilize its incremental capacity by FY26, potentially achieving a turnover of Rs.750–800 Cr.
The company preferred to grow with low financial leverage and not gone for aggressive long-term debt. This reduces the financial risk but means growth can be limited to the retained earnings available for investment.
Disclaimer: The article is for informational purposes only and not investment advice.