Are Safari Inds. latest results good or bad?

Safari Industries' latest financial results for the quarter ended September 2025 reveal a mixed operational performance. The company reported a net profit of ₹46.94 crores, reflecting a year-on-year growth of 58.26%, although it experienced a sequential decline of 7.03% compared to the previous quarter. This indicates a strong year-over-year performance but raises questions about short-term profitability.
Revenue for the same quarter reached ₹533.55 crores, marking a modest sequential increase of 1.08% from ₹527.83 crores in the previous quarter and a more robust year-on-year growth of 16.55%. This growth in revenue highlights Safari's ability to expand its top line despite facing operational challenges.

However, the results also indicate a concern regarding margin compression. The operating margin (excluding other income) contracted to 13.88% from 15.02% in the previous quarter, reflecting a decline of 114 basis points. This trend suggests potential pressures from rising operational costs or competitive pricing dynamics, which could impact the company's pricing power.

The company's ability to maintain its premium valuation, trading at a significant multiple relative to its peers, will depend on its capacity to navigate these margin pressures while sustaining revenue growth. Additionally, the company saw an adjustment in its evaluation, reflecting the complexities of its current operational landscape.

Overall, while Safari Industries demonstrates resilience with strong revenue growth and significant year-on-year profit increases, the sequential decline in profitability and margin compression warrant careful monitoring as the company seeks to balance growth with operational efficiency.