Are Nidhi Granites Ltd latest results good or bad?

Nidhi Granites Ltd's latest financial results for Q2 FY26 reflect a notable sequential decline in both net sales and net profit. Specifically, net sales amounted to ₹13.18 crores, representing a 33.47% decrease compared to the previous quarter, while net profit was reported at ₹1.29 crores, down 42.41% quarter-on-quarter. However, when viewed on a year-on-year basis, the company experienced a positive trend, with net sales increasing by 8.93% from ₹12.10 crores in Q2 FY25 and net profit rising by 17.27% from ₹1.10 crores in the same quarter last year. The operating margin, excluding other income, was recorded at 15.63%, slightly lower than the previous quarter's 16.00%, yet this margin remains stable compared to historical performance. The PAT margin also saw a contraction to 9.79% from 11.31% in the prior quarter, but it aligns with the company's typical range of 8-11%. The quarter's results suggest a normalization of business activity following an exceptional performance in Q1 FY26, where revenues surged significantly. This sequential decline in performance should be viewed in the context of the extraordinary growth experienced earlier, indicating that the current results may not reflect a long-term trend but rather a return to more typical operational levels. Additionally, Nidhi Granites has demonstrated resilience in maintaining operational margins despite revenue fluctuations, showcasing effective cost management. The company's balance sheet remains strong, with minimal debt, providing it with financial flexibility. It is worth noting that the company saw an adjustment in its evaluation, reflecting the complexities of its current financial standing and market conditions. Overall, while the latest results indicate some challenges in the short term, the year-on-year growth and operational stability suggest underlying strengths that may support future performance.