Shree Nidhi Trading's Revenue Surge Fails to Translate into Profits
The NBFC's annual revenue more than doubled, but a quarterly loss caps a year of volatile profitability.
Shree Nidhi Trading reported a 125% jump in full-year revenue for FY23. However, the final quarter saw a net loss, highlighting ongoing profitability challenges.
Shree Nidhi Trading Co has delivered a year of dramatic top-line expansion, though its bottom line tells a more complex story. For the full fiscal year 2023, the non-banking financial company's revenue more than doubled, yet it ended the final quarter with a net loss, underscoring persistent volatility in its earnings.
The company's quarterly performance was a tale of two metrics. Revenue held steady at ₹0.23 crore in Q4 FY23, unchanged from the previous quarter but up sharply from a very low base a year ago. Profit, however, swung to a loss of ₹0.03 crore, a significant reversal from the ₹0.04 crore profit posted in Q3 FY23. This pushed the net profit margin for the quarter into negative territory at -13.0%.
A look at the last five quarters reveals the erratic nature of the company's profitability, even as revenue stabilized at a higher level.
Revenue (₹ Cr)
Profit (₹ Cr)
Net Profit Margin (%)
| Metric | CurrentQ4 FY23 | PreviousQ3 FY23 | Same quarter LYQ4 FY22 |
|---|---|---|---|
| Revenue (₹ Cr) | 0.23YoY +2200% | 0.23 | 0.01 |
| Profit (₹ Cr) | -0.03YoY +86% | 0.04 | -0.22 |
| Net Profit Margin (%) | -13.0 | 17.4 | — |
Zooming out to the full year, the picture is mixed. FY23 revenue grew 125% year-on-year to ₹0.90 crore, and the company turned an annual net loss of ₹0.16 crore in FY22 into a small profit of ₹0.02 crore. This translates to a modest net profit margin of 2.2% for the full year.
Key Points
- The company maintains a strong balance sheet, with a low debt-to-equity ratio of 0.2 and a healthy current ratio of 4.26.
- Return on Equity (ROE) for the year was 0.26%.
- The stock trades at a significant premium to its industry, with a P/E ratio of 47.3 compared to the sector average of 25.5.
While the annual figures show a turnaround from loss to profit, the inconsistent quarterly results and the latest quarterly loss suggest the path to sustainable earnings growth remains uncertain for this small-cap NBFC.
Live Chart
· SHREE NIDHI TRADING
(BSE)
ISIN: INE066E01015
Also read
Want this applied to your portfolio?
Talk to a HexaWealth advisor, or sync your mutual fund data for insights tailored to your holdings.