Are Narendra Prop. latest results good or bad?

The latest financial results for Narendra Properties for the quarter ended September 2025 reveal significant operational challenges. The company reported zero revenue, marking a complete decline from ₹2.75 crores in the previous quarter (June 2025) and a stark contrast to ₹3.69 crores in the same quarter last year (September 2024). This absence of sales underscores a persistent volatility in revenue generation, which is heavily reliant on project completion and handover timelines.
Despite generating a net profit of ₹0.40 crores, this figure is primarily attributed to other income of ₹0.75 crores, which significantly offset the operating loss of ₹-0.34 crores. This reliance on non-operating income raises concerns about the sustainability of the company's core operations. The reported net profit reflects a decline of 48.05% from the previous quarter's profit of ₹0.77 crores, indicating ongoing difficulties in maintaining profitability.

The company's average return on equity (ROE) stands at 10.54%, but the latest ROE has deteriorated to 4.71%, suggesting declining profitability relative to shareholder equity. Additionally, the average return on capital employed (ROCE) is notably weak at 2.12%, with the most recent ROCE turning negative at -1.18%. These metrics highlight issues with capital efficiency and operational effectiveness.

Furthermore, the company's cash flow dynamics indicate stress, with negative cash flow from operations reported at ₹-3.00 crores for FY25. This situation has resulted in the company ending the year with zero cash, raising concerns about liquidity and the ability to sustain operations without external financing.

Overall, the financial performance of Narendra Properties in Q2 FY26 reflects critical operational weaknesses, characterized by zero revenue, heavy reliance on non-operating income, and deteriorating capital efficiency. The company has experienced an adjustment in its evaluation, reflecting the market's recognition of these challenges and the need for improved operational execution moving forward. Investors should closely monitor future quarters for any signs of revenue generation and operational recovery.