Are Arihant Capital latest results good or bad?

Arihant Capital's latest financial results for Q2 FY26 reflect a complex operational landscape. The company reported a consolidated net profit of ₹13.08 crores, which showed a quarter-on-quarter increase of 2.99%, yet this figure represents a significant year-on-year decline of 34.40%. In terms of net sales, the company achieved ₹56.98 crores, marking a quarter-on-quarter growth of 12.23% from ₹50.77 crores in the previous quarter. However, this still reflects a substantial year-on-year contraction of 25.40% compared to the ₹76.38 crores recorded in the same quarter last year.
The operating margin for the quarter stood at 42.16%, indicating a sequential improvement of 218 basis points, which suggests effective cost management despite the revenue challenges. However, the profit after tax (PAT) margin decreased to 22.96%, down 205 basis points from the previous quarter, primarily due to rising interest expenses, which surged by nearly 60% quarter-on-quarter to ₹6.25 crores.

For the first half of FY26, the consolidated net profit was ₹25.78 crores, down 33.47% from ₹38.75 crores in the same period last year, with total revenue declining by 27.78% year-on-year. These results underscore the ongoing challenges faced by the brokerage firm, particularly in a capital markets environment characterized by reduced retail participation and volatile trading volumes.

In light of these results, the company saw an adjustment in its evaluation, reflecting the ongoing operational pressures and the need for close monitoring of future performance. The financial data indicates that while there are signs of sequential recovery, the broader year-on-year trends highlight significant headwinds that the company must navigate moving forward.