Are Excel Realty N Infra Ltd latest results good or bad?

Excel Realty N Infra Ltd's latest financial results for Q2 FY26 indicate significant operational challenges, particularly in revenue generation. The company reported net sales of ₹1.51 crores, which represents a substantial decline of 73.92% quarter-on-quarter and 63.08% year-on-year. This marks the lowest quarterly revenue in recent periods, raising concerns about the sustainability of its core business operations. Despite the drop in sales, the company reported a net profit of ₹1.09 crores, a remarkable increase of 5,350.00% from the previous quarter, primarily driven by other income, which amounted to ₹1.80 crores. This reliance on non-operational income highlights a critical vulnerability in Excel Realty's business model, as the core trading and distribution operations continue to incur losses, with an operating margin of -44.37%. The financial data also shows that the company has not achieved positive operating profit (excluding other income) in any quarter over the past two years, indicating persistent operational weaknesses. The operating profit margin has fluctuated significantly, and the recent results further emphasize the volatility in revenue and the ongoing challenges faced by the company. In terms of evaluation, Excel Realty experienced an adjustment in its evaluation based on these financial results. The balance sheet remains a relative strength, with a virtually debt-free structure, but this has not translated into improved operational performance. The company’s return on equity (ROE) and return on capital employed (ROCE) metrics are notably low, underscoring issues with capital efficiency. Overall, while Excel Realty has demonstrated impressive long-term returns historically, the recent financial performance reveals substantial risks and operational difficulties that investors should consider carefully. The company’s dependency on other income to report profitability raises fundamental questions about its long-term viability in the trading and distribution sector.