💰 Financial Performance

Revenue Growth by Segment

Total operating revenue grew by 91.97% from INR 109.39 Cr in FY24 to an estimated INR 210 Cr in FY25. This growth was primarily driven by the manufacturing segment and the introduction of new products like base oil and food preservatives. Future revenue is projected to grow at a steady rate of 10-12% annually.

Geographic Revenue Split

Not disclosed in available documents; however, the company operates its primary manufacturing unit in Khanna, Punjab.

Profitability Margins

Operating margins improved significantly from 3.2% in FY23 to 6.40% in FY24, a 100% increase in margin efficiency. This was driven by lower material costs and a strategic shift toward the higher-margin manufacturing segment. PAT margins also rose from 1.54% in FY23 to 2.76% in FY24. Margins are expected to stabilize between 7-8% going forward.

EBITDA Margin

Operating margin stood at 6.40% in FY24, representing a 320 basis point improvement YoY. This core profitability is expected to reach 7-8% as the company scales its manufacturing of specialized additives.

Capital Expenditure

The company is estimated to reach a net worth of INR 26 Cr by March 2025 and INR 36 Cr by March 2026, suggesting internal accrual-funded growth. However, any large debt-funded capex is flagged as a risk that could weaken the capital structure.

Credit Rating & Borrowing

Ratings were upgraded to 'Crisil BBB-/Stable' (Long Term) and 'Crisil A3' (Short Term) in April 2025. The company has total bank loan facilities of INR 50 Cr (enhanced from INR 35 Cr), with interest coverage at 3.58 times as of FY24.

⚙️ Operational Drivers

Raw Materials

The company utilizes various chemicals and minerals to produce additives; specific raw material names are not listed, but the finished products include base oil and food preservatives.

Key Suppliers

Not disclosed in available documents; however, the company maintains longstanding relationships with its supplier base to support its business risk profile.

Capacity Expansion

While specific MTPA figures are not provided, the company's revenue capacity has effectively doubled from INR 109.39 Cr to an estimated INR 210 Cr in FY25 through the addition of new product lines.

Raw Material Costs

Lower material costs were a primary driver for the operating margin doubling to 6.40% in FY24. Procurement strategies rely on the promoters' decade-long experience in the chemical industry.

Manufacturing Efficiency

Efficiency has improved by increasing the share of the manufacturing segment relative to trading, which fetches higher margins and drove the margin expansion to 6.40%.

📈 Strategic Growth

Expected Growth Rate

10-12%

Growth Strategy

Growth will be achieved through the addition of new customers and the expansion of the product portfolio into high-demand areas such as base oil and food preservatives. The company is also focusing on increasing the revenue contribution from its own manufacturing unit in Khanna, Punjab, which offers superior margins compared to trading activities.

Products & Services

Specialized chemicals and minerals, specifically base oil for the petroleum industry and food preservatives for the food and bakery industry, alongside additives for plywood, cattle feed, and pigments.

New Products/Services

Recently launched base oil and food preservatives are the primary drivers for the revenue jump to INR 210 Cr in FY25.

Market Expansion

The company is expanding its customer base within the petroleum and food sectors to diversify its revenue streams.

🌍 External Factors

Industry Trends

The industry is seeing a shift toward specialized additives. SKMAPL is positioning itself by moving from a trading-heavy model to a manufacturing-focused model to capture higher value-add in the food and petroleum supply chains.

Competitive Landscape

The company competes in the fragmented chemical and mineral additives market, focusing on niche segments like cattle feed and bakery additives.

Competitive Moat

The company's moat is built on the 10+ years of experience of its promoters (Mr. Mohit Jindal and others) and established relationships with a diversified client base. This provides a stable platform for scaling new products like food preservatives.

Macro Economic Sensitivity

The company is sensitive to fluctuations in the chemical industry and raw material price volatility, which directly impacts its 6-8% operating margin target.

Consumer Behavior

Increased demand for processed foods and bakery products is driving the need for food preservatives, supporting the company's new product strategy.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to chemical manufacturing standards and food safety regulations for its preservative products. The company must comply with SEBI (Depositories and Participants) Regulations for its listed securities.

⚠️ Risk Analysis

Key Uncertainties

The primary risk is an average financial risk profile with a gearing of 1.73 times in FY24. Any large debt-funded capital expenditure could weaken the capital structure and impact the credit rating.

Geographic Concentration Risk

Manufacturing is concentrated in a single location in Khanna, Punjab, making operations vulnerable to regional disruptions.

Third Party Dependencies

Moderate dependency on bank lenders, with average bank limit utilization at 79% through February 2025.

Credit & Counterparty Risk

Receivables quality is considered stable due to longstanding relationships with a diversified end-user base.