Mumbai, May 3, 2025 — Netweb Technologies India Limited (BSE: 543945, NSE: NETWEB), a leading player in the computer server manufacturing segment, has announced its audited financial results for the quarter and fiscal year ended March 31, 2025. The board meeting held on May 3, 2025, revealed a year of remarkable financial performance, a generous dividend proposal, and strategic corporate governance updates. This article delves into the key highlights, financial metrics, and strategic decisions that position Netweb as a formidable contender in India’s burgeoning IT infrastructure sector.
Key Highlights
- Revenue Growth: Consolidated revenue surged by 58.7% YoY to ₹11,490.21 million in FY25.
- Profit Surge: Net profit soared to ₹1,144.75 million, up 50.8% from FY24.
- Dividend Declaration: A 125% dividend (₹2.50 per share) proposed, subject to shareholder approval.
- Auditor Appointments: M/s Sanmarks & Associates named Internal Auditors; M/s P.C Jain & Co appointed as Secretarial Auditors for 5 years.
- IPO Fund Utilization: Full deployment of ₹1,940.24 million IPO proceeds, with strategic reallocation to general corporate purposes.
Financial Performance: A Deep Dive
Revenue and Profitability
Netweb’s FY25 revenue from operations stood at ₹11,490.21 million, a staggering increase from ₹7,240.75 million in FY24. This growth is attributed to heightened demand for IT infrastructure solutions, particularly in cloud computing and enterprise server systems.
- Quarterly Performance: Q4 FY25 revenue hit ₹4,146.51 million, up 24.1% sequentially from Q3 FY24 (₹3,339.92 million).
- Net Profit: FY25 net profit reached ₹1,144.75 million, reflecting a 50.8% YoY increase (FY24: ₹759.03 million). Earnings per share (EPS) rose to ₹20.25 (basic) and ₹20.24 (diluted).
Key Drivers:
- Cost Management: Despite inflationary pressures, operating expenses grew at a slower pace (58.4% YoY) compared to revenue (58.7% YoY).
- Tax Efficiency: Effective tax rate reduced to 25.6% in FY25 (vs. 26.3% in FY24), contributing to higher net margins.
Balance Sheet Strength
Netweb’s total assets expanded to ₹8,933.60 million in FY25 (FY24: ₹6,124.68 million), driven by:
- Current Assets: Doubled to ₹8,253.81 million, fueled by inventory buildup (₹2,228.33 million) and trade receivables (₹3,615.31 million).
- Non-Current Assets: Increased 29.7% to ₹679.79 million, with significant investments in property, plant, and equipment (₹415.16 million).
Equity Position: Shareholders’ equity grew to ₹5,190.01 million, underscoring robust retained earnings and investor confidence.
Cash Flow Analysis
- Operating Activities: Net cash outflow of ₹132.11 million due to working capital strain (e.g., inventory and receivables buildup).
- Investing Activities: Positive cash flow of ₹1,115.90 million, driven by maturity of bank deposits (₹1,219.50 million).
- Financing Activities: Outflow of ₹179.71 million, primarily from dividend payments (₹112.74 million) and debt repayments.
Liquidity Snapshot: Cash reserves stood at ₹1,700.83 million, ensuring ample liquidity for future expansions.
Dividend Announcement: Rewarding Shareholders
The board proposed a 125% dividend (₹2.50 per share) on equity shares of face value ₹2, translating to a total payout of ₹141.63 million. Key details:
- Record Date: To be announced post-shareholder approval at the Annual General Meeting (AGM).
- Historical Context: This marks a 25% increase from FY24’s dividend of ₹2.00 per share.
IPO Fund Utilization: Strategic Reallocation
Netweb’s 2023 IPO raised ₹1,940.24 million (net of expenses). As of March 31, 2025:
- Capital Expenditure: ₹209.72 million spent on SMT production lines and infrastructure.
- Working Capital: ₹1,280.22 million deployed to meet operational demands.
- Debt Repayment: ₹225 million used to reduce borrowings.
Notable Adjustment: ₹113.14 million reallocated from capex to general corporate purposes, within SEBI’s 25% limit.
Industry Context and Future Outlook
Netweb operates in India’s $10 billion server market, which is growing at 15% CAGR driven by digital transformation and data localization trends.
Growth Levers:
- Cloud Adoption: Rising demand from enterprises migrating to hybrid cloud setups.
- Government Contracts: Potential wins under India’s “Make in India” and data sovereignty initiatives.
- Export Opportunities: Expanding footprint in Southeast Asia and Africa.
Risks:
- Supply Chain Disruptions: Global semiconductor shortages could impact production.
- Competition: Rising rivalry from multinationals like Dell and HPE.
Conclusion
Netweb Technologies India Limited’s FY25 performance underscores its resilience and strategic agility in a competitive market. With robust financials, shareholder-friendly policies, and prudent governance, the company is well-positioned to capitalize on India’s digital infrastructure boom. Investors and stakeholders can look forward to sustained growth as Netweb continues to innovate and expand its market share.
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