Are Alpex Solar Ltd latest results good or bad?

Alpex Solar Ltd's latest financial results for Q3 FY26 highlight a strong revenue growth trajectory, with net sales reaching ₹648.08 crores, reflecting a year-on-year increase of 245.40%. This performance marks an all-time quarterly high for the company and underscores its success in capturing market share within the solar and electrical equipment sector. The net profit for the quarter also showed significant growth, amounting to ₹54.27 crores, which is a 132.02% increase compared to the same period last year. However, the results also reveal some operational challenges. The operating margin has contracted to 13.95%, down from 14.90% in the previous quarter and 19.62% a year ago. This decline in margin suggests potential pressures from rising input costs or competitive dynamics that may be impacting the company's pricing power. Similarly, the profit after tax (PAT) margin has decreased to 8.37%, indicating a year-on-year erosion of 410 basis points. The company has experienced a notable increase in interest expenses, which surged to ₹6.49 crores, reflecting the working capital intensity associated with its rapid expansion. Despite these challenges, Alpex Solar maintains a healthy return on equity of 27.65%, demonstrating strong capital efficiency. On a broader scale, the nine-month performance for FY26 shows cumulative net sales of ₹1,551.32 crores and a consolidated net profit of ₹149.22 crores, already surpassing the full-year figures for FY25. This indicates that Alpex Solar is on a solid growth path, although the recent adjustments in its evaluation suggest that there may be concerns regarding the sustainability of its profitability amidst rising operational costs. Overall, while Alpex Solar Ltd has showcased remarkable revenue growth and strong profit figures, the compression in margins and rising costs present important factors for stakeholders to monitor moving forward.