Please find enclosed financial results for the half year and year ended March 31, 2025
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Royal Sense Limited's board approved audited standalone and consolidated financial results for FY25 on May 19, 2025, with the auditors (CN D & Associates) issuing an unmodified (clean) opinion on both. On a standalone basis, profit before tax jumped to about Rs. 412.93 lakhs from Rs. 229.99 lakhs in FY24, roughly 80% growth, while operating cash flow swung positive to Rs. 176.12 lakhs from a negative Rs. 81.45 lakhs earlier. On a consolidated basis, the wholly-owned subsidiary Stergic Retail Pvt Ltd posted a sharp rise in revenue to about Rs. 3,816.73 lakhs (from Rs. 155.19 lakhs) and a profit after tax of Rs. 314.76 lakhs, lifting consolidated reserves to Rs. 2,060.23 lakhs. Total assets stood at about Rs. 3,556 lakhs on a consolidated basis, with cash and equivalents of Rs. 4,124.73 lakhs. A utilisation certificate from the auditor also confirmed that proceeds from the preferential share and warrant issue were deployed for working capital and general corporate purposes as per the offer document. Notably, the previous year's (FY24) financial results were reviewed by a different auditor, indicating an auditor change.
Clean audit opinion, sharp rise in profits and a turnaround in operating cash flow are positive signs for shareholders and may support the stock sentiment. Investors should however note the change in statutory auditor for FY25 and the steep rise in trade receivables and loans and advances, which warrant scrutiny for collection risk.