Experienced management and long-track record of operations of the group
Indo Group has been present in the welfare scheme supply industry for over 15 years and is supported by a well experienced and qualified management personnel. Mr. Rajan Jadhav, promoter and CEO of the group, has a business experience of more than three decades. From starting only as a trader and supplier to the various departments of Maharashtra State Government, the group has now expanded its operations to manufacturing and supply of ready to cook food items also. Therefore, the experience of the promoters has helped the group to expand its product offerings.

Robust scale of operations
The revenue of the group significantly grew and stood at Rs. 2,583.66 Cr. in FY24 as against Rs. 1,293.78 Cr. in FY23 on account of repetitive order inflows during the year under the welfare schemes. However, the revenues of the group moderated in FY25 to ~Rs.1,600 Cr. owing to lower spends by state government on welfare schemes owing to the state elections. Further, the margins of the group continue to decline but remain healthy at 16.15% in FY24 against 20.38% in FY23. The reduction in margin is on account of limited pricing power (since prices are decided by the authorities in the tenders) and rising input costs. 
Moreover, the established track record of operations, continued focus of government on welfare schemes leading to repeated and healthy order inflows is expected to keep the scale of operations healthy in the medium term. 

Healthy financial risk profile
The financial risk profile of the group is marked healthy with a strong net worth, healthy capital structure and comfortable debt protection metrics. The growing profits led to improvement in group’s networth to Rs.727.38 Cr. as on 31st March, 2024 against Rs. 552.08 Cr. as on 31st March, 2023 despite significant withdrawal of capital worth ~Rs.174 Cr. (~Rs.113 Cr. in FY23). The gearing also remained healthy at 0.18 times as on 31st March, 2024 (0.22 times as on 31st March, 2023) in absence of any long term debt. Further, total outside liabilities to total net worth (TOL/TNW) stood comfortable at 0.54 times as on 31st March, 2024 (0.60 times 31st March, 2023).

Moderately intensive working capital operations
The working capital operations of the group is moderately intensive marked by gross current asset (GCA) of 105 days in FY24 as against 178 days for FY23. The high GCA days is majorly on account of elongated debtor days even though improved in FY24. The debtor days stood at 52 days in FY24 against 124 days in FY23. The elongation is due to delay in release of payments under the government welfare schemes. Additionally, the inventory days also improved from 45 days in FY23 to 14 days in FY24 on account of repeated orders which led to no stocking up.

Vulnerability of operating performance to state government welfare policies
The tenders under the state welfare schemes are primarily based on the state regulations and budgetary allocations. Further, since the contract price in such tenders is determined by the authorities, the group has limited pricing power thereby affecting the margins. Further, the group's revenue is directly linked to the successful bidding of orders amidst high competition intensity. Moreover, the group has high client concentration as its entire business is directly or indirectly relied on the state government of Maharashtra.
 
Significant capital withdrawal from partnership firms
The partnership firms of the group withdraw significant capitals (~Rs.174 Cr. in FY24, ~Rs.113 Cr. in FY23) limiting the growth in net-worth.