Are Kerala Ayurveda Ltd latest results good or bad?

Kerala Ayurveda Ltd's latest financial results for the quarter ending September 2025 reveal significant operational challenges. The company reported net sales of ₹34.84 crores, reflecting a quarter-on-quarter growth of 21.78% and a year-on-year increase of 14.57%. However, this growth in revenue did not translate into profitability, as the company incurred a net loss of ₹6.34 crores, marking a substantial decline compared to the previous quarter. The operating margin for the quarter was reported at -14.21%, a stark contrast to the positive margin of 18.18% in the same quarter last year, indicating severe cost pressures. Employee costs represented a significant portion of sales, at 45.47%, which has contributed to the erosion of margins. Additionally, interest expenses surged, reflecting the company's high debt burden, with a debt-to-equity ratio reported at 15.49 times, highlighting elevated financial leverage. The overall financial performance indicates a concerning trend, with the company experiencing a collapse in profitability metrics and a deterioration in operational efficiency. As a result, there has been an adjustment in the company's evaluation, reflecting the ongoing financial distress and operational inefficiencies. The balance sheet shows negative working capital, further complicating the company's liquidity position. In summary, while Kerala Ayurveda Ltd has shown some revenue growth, the underlying financial health is troubling, characterized by significant losses, high leverage, and operational inefficiencies that warrant close monitoring in future periods.