💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations grew 2.09% YoY to INR 239.68 Cr in FY25 from INR 234.77 Cr in FY24. Segments include trading of chemicals, textiles, minerals, and metals, alongside realty development and investments.

Geographic Revenue Split

Not disclosed in available documents; the company is domiciled in India with its registered office in Ahmedabad, Gujarat.

Profitability Margins

Profit After Tax (PAT) margin declined from 6.77% in FY24 to 3.91% in FY25. Profitability was impacted by an exceptional item expense of INR 16.94 Cr in FY25.

EBITDA Margin

Operating profit (PBILDT) margin was 6.91% in FY20. For FY25, the company reported a Profit Before Tax (PBT) of INR 11.47 Cr, down 45.1% YoY from INR 20.90 Cr in FY24.

Capital Expenditure

In FY25, the company saw a net inflow from fixed assets of INR 8.81 Cr (likely disposals), compared to a capital addition of INR 11.67 Cr in FY24.

Credit Rating & Borrowing

Credit Rating: CARE BBB+; Stable (Long-term) and CARE A2 (Short-term) for bank facilities totaling INR 45.54 Cr. Finance costs were INR 0.56 Cr in FY25, down 20.8% YoY from INR 0.70 Cr.

⚙️ Operational Drivers

Raw Materials

Traded Chemicals, Textiles, Minerals, Ores, Metals, and Precious Metals (Stock-in-trade accounts for 84.5% of total revenue).

Capacity Expansion

The company demerged 90% of its manufacturing capacity in 2009 and currently focuses on trading and investments; no manufacturing expansion is planned.

Raw Material Costs

Purchases of stock-in-trade amounted to INR 202.67 Cr in FY25, representing 84.5% of revenue, compared to INR 229.69 Cr in FY24.

Manufacturing Efficiency

Not applicable as the company has no active manufacturing operations.

📈 Strategic Growth

Expected Growth Rate

2.09%

Growth Strategy

Growth is targeted through revenue diversification in trading (textiles, minerals, metals) and leveraging a INR 165 Cr liquidity pool from a historical unit sale to invest in real estate ventures and inter-corporate deposits (ICDs) on a profit-sharing basis.

Products & Services

Wholesale traded chemicals, textiles, minerals, ores, metals, precious metals, and real estate development services.

Strategic Alliances

Historical sale of Vadodara unit to Huntsman International (India) Pvt. Ltd. (HIPL) for INR 165 Cr.

🌍 External Factors

Industry Trends

The chemical industry is cyclical and currently seeing a slow recovery; MGL is positioned as a wholesale trader to mitigate manufacturing-specific risks.

Competitive Landscape

Exposed to intense competition from unorganized players and price-sensitive market dynamics.

Competitive Moat

Moat consists of 25+ years of promoter experience and a strong liquidity position with cash and liquid investments exceeding outstanding debt (zero net debt in FY20).

Macro Economic Sensitivity

Highly sensitive to the chemical industry cycle and demand from end-user industries like textiles and dyes.

Consumer Behavior

Demand is driven by industrial users; sluggish demand in end-user industries directly impacts trading volumes.

Geopolitical Risks

Global pandemic disruptions previously led to a 30% YoY decline in total operating income during Q1FY21.

⚖️ Regulatory & Governance

Industry Regulations

Compliance with Ind AS and the Companies Act 2013; auditors issued an unmodified opinion on internal financial controls over financial reporting.

Environmental Compliance

Not disclosed; historical manufacturing units were subject to pollution norms.

Taxation Policy Impact

Effective tax rate for FY25 was approximately 21.6% (INR 2.48 Cr current tax on INR 11.47 Cr PBT).

Legal Contingencies

Pending litigations related to disputed tax liabilities as mentioned in Annexure A point (vii) of the Auditor's Report.

⚠️ Risk Analysis

Key Uncertainties

Risks associated with sizeable investments in the cyclical real estate sector and potential delinquency in inter-corporate deposits (ICDs).

Geographic Concentration Risk

Operations are primarily centered in Gujarat, India.

Technology Obsolescence Risk

Low risk for trading operations; the company maintains standard internal financial controls for reporting.

Credit & Counterparty Risk

Exposure to various entities through ICDs; interest income (INR 17.85 Cr in FY19) is dependent on counterparty business risks.