Are Keystone Realtors Ltd latest results good or bad?

Keystone Realtors Ltd's latest financial results for the quarter ending December 2025 reflect significant operational challenges. The consolidated net profit stood at ₹3.38 crore, representing a substantial decline of 77.57% year-on-year. This decline is indicative of severe profitability issues, as the company grapples with a volatile revenue environment, evidenced by net sales of ₹266.17 crore, which marked a 42.64% year-on-year decrease and a 46.69% drop from the previous quarter. The operating profit margin, excluding other income, fell to 4.31%, down from 8.86% in the same quarter last year, highlighting a concerning erosion of operational efficiency. The profit before tax also reflected a significant decline, with a year-on-year drop of 76.55%, underscoring the company's reliance on other income to offset weak operational performance. Interest expenses surged to ₹23.26 crore, nearly doubling from the previous year, which has raised concerns about the company's ability to service its debt obligations. The operating profit to interest coverage ratio has fallen below 1x for the first time, indicating that core operations are unable to generate sufficient cash to cover interest expenses. Additionally, the company's return on capital employed (ROCE) and return on equity (ROE) have slipped to historically low levels, raising questions about its capital allocation and operational efficiency. The shareholding pattern shows a reduction in promoter stakes, which may signal a lack of confidence in the company's near-term prospects. Overall, Keystone Realtors Ltd is facing a challenging operational environment with significant financial deterioration, leading to an adjustment in its evaluation. The company’s struggles are compounded by broader market conditions in the real estate sector, particularly in its core Mumbai micro-markets.