Are Astra Microwave Products Ltd latest results good or bad?

Astra Microwave Products Ltd's latest financial results for Q2 FY26 reveal a mixed performance characterized by sequential recovery but challenges in year-on-year comparisons. The company reported a net profit of ₹23.90 crores, reflecting a significant sequential increase of 46.90% from the previous quarter, although it is down 5.87% compared to the same quarter last year. Revenue for the same period was ₹214.59 crores, showing a 7.44% increase quarter-on-quarter, yet it remains 6.54% lower than the corresponding quarter last year. The operating margin, excluding other income, improved to 22.29%, up from 20.51% in Q1 FY26, indicating better operational efficiency. Additionally, the profit after tax margin rose to 11.14%, marking an increase from 8.15% in the prior quarter, although it is still below the 18.02% achieved in Q4 FY25. Despite these positive sequential trends, the year-on-year performance raises concerns, particularly with a 21.70% decline in revenue compared to the four-quarter average. This suggests execution delays or disruptions in order flow, which are common in the defence sector due to the nature of contracts. On a half-yearly basis, the company reported revenue growth of 23.26% year-on-year, indicating some resilience, but the volatility in quarterly performance remains a critical factor. The working capital situation appears stretched, with cash flow from operations turning negative, which has been a recurring issue for the company. Overall, Astra Microwave's results highlight a recovery in the short term, but the underlying execution challenges and working capital pressures warrant careful monitoring. The company has experienced an adjustment in its evaluation, reflecting the complexities of its operational landscape amidst a backdrop of strong sector demand.