Are Eureka Forbes Ltd latest results good or bad?

Eureka Forbes Ltd's latest financial results for the quarter ending December 2025 reveal significant operational challenges, particularly in profitability metrics. The company reported a net profit of ₹10.02 crores, which represents a substantial decline of 71.41% year-on-year. This sharp drop in net profit is accompanied by a PAT margin that compressed to 1.55%, down from 5.86% in the same quarter last year. While the company achieved a revenue growth of 7.97% year-on-year, totaling ₹645.40 crores, this figure reflects a sequential decline of 16.41% from the previous quarter's revenue of ₹772.08 crores. Such a drop raises concerns about the sustainability of demand and potential seasonality effects impacting the business. Operating margins also faced compression, with the latest reading at 10.63%, down from 12.65% in the prior quarter. This indicates a disconnect between revenue growth and profitability, suggesting that operational efficiencies may be under pressure. The company's return on equity (ROE) remains low at 3.17%, highlighting challenges in generating adequate returns from shareholder capital. Overall, the results indicate that Eureka Forbes is navigating a difficult operational landscape, with significant margin pressures and declining profitability metrics overshadowing its revenue growth. The company saw an adjustment in its evaluation following these results, reflecting the ongoing concerns regarding its financial performance and operational efficiency. Investors may need to closely monitor future quarters for signs of recovery or further deterioration in these trends.