Are First Custodian latest results good or bad?

The latest financial results for First Custodian Fund indicate significant challenges in its operational performance. For the quarter ending September 2025, the company reported net sales of ₹0.01 crores, which reflects a year-on-year decline of 75.00% from ₹0.04 crores in the same quarter of the previous year, while remaining unchanged from the previous quarter. This substantial drop in revenue highlights the company's struggle to maintain its market position amid increasing competition from discount brokers and digital platforms.
Net profit for the same quarter was ₹0.02 crores, marking a 95.92% decrease compared to ₹0.49 crores in Q2 FY24. Although there was a technical recovery from a loss of ₹0.21 crores in Q1 FY26, the year-on-year comparison raises concerns about the sustainability of profitability. The profit after tax (PAT) margin stood at 200.00%, but this figure is misleading as it is derived from a very low revenue base.

The company's return on equity (ROE) is currently at 5.74%, which is below its five-year average of 7.72%, indicating a decline in capital efficiency and raising questions about its ability to generate adequate returns for shareholders. Additionally, First Custodian Fund's operational metrics reveal an unsustainable cost structure, with employee costs consuming 500% of sales, further exacerbating the financial strain.

Following the announcement of these results, the company experienced an adjustment in its evaluation, reflecting the market's concerns regarding its future prospects. The absence of institutional interest and the ongoing underperformance of its stock, which has declined significantly over the past year, further underscore the challenges facing First Custodian Fund.

In summary, the financial data indicates that First Custodian Fund is grappling with severe operational difficulties, marked by a drastic decline in revenue and profit, unsustainable cost structures, and a lack of competitive positioning in the evolving brokerage landscape.