Are Dar Credit & Capital Ltd latest results good or bad?

Dar Credit & Capital Ltd's latest financial results for Q3 FY26 reflect a mixed operational performance. The company reported a net profit of ₹2.52 crores, which represents a year-on-year growth of 40.00%. Additionally, net sales reached ₹12.56 crores, showing a year-on-year increase of 25.10%. This marks the seventh consecutive quarter of revenue growth, indicating sustained demand for its financial products, particularly in personal loans and MSME financing. The operating margin improved to 70.30%, reflecting enhanced operational efficiency despite rising interest costs. However, the net profit margin slightly declined from the previous quarter to 20.06%, although it remains higher than the same quarter last year. The company has demonstrated disciplined cost management, with operating profit before depreciation, interest, and tax reaching its highest level in seven quarters. Despite these positive trends, the return on equity (ROE) of 7.04% remains a concern, as it is below industry averages, indicating challenges in capital efficiency. The company's high debt-to-equity ratio of 1.54 times further amplifies financial risk. Additionally, the absence of disclosed data on asset quality metrics limits a comprehensive assessment of the company's lending practices. Overall, while Dar Credit & Capital has shown operational momentum with consistent revenue growth and improved profitability, the underlying concerns regarding capital efficiency, high leverage, and limited institutional interest suggest that the company faces significant challenges moving forward. The company saw an adjustment in its evaluation, reflecting these mixed operational trends and financial metrics.