Are Sandesh Ltd. latest results good or bad?

The latest financial results for Sandesh Ltd. reveal a complex situation characterized by contrasting trends in revenue and profitability. For the quarter ended September 2025, the company reported net sales of ₹77.84 crores, reflecting a sequential growth of 6.15% from the previous quarter. This marks a positive trend in revenue generation, indicating some resilience in top-line performance despite broader challenges in the media sector. However, the company's net profit experienced a significant decline, plummeting to ₹3.86 crores, which represents a sharp year-on-year decrease of 89.89%. This decline in profitability is primarily attributed to a drastic reduction in operating profit, which fell to ₹4.76 crores from ₹15.74 crores a year ago, resulting in an operating margin of just 6.12%. This margin compression, down from 22.32% in the prior-year quarter, suggests substantial operational challenges and cost pressures that the company is currently facing. Moreover, the volatility in other income has raised concerns regarding the sustainability of earnings, as it constituted a significant portion of profit before tax. The reliance on non-operating income sources has led to questions about the quality of earnings, particularly given that other income fell by 91% year-on-year. In terms of return metrics, the return on equity (ROE) stands at 5.67%, indicating weak capital efficiency. The company's financial performance has prompted an adjustment in its evaluation, reflecting the underlying operational difficulties and the challenges in generating consistent profits. Overall, while Sandesh Ltd. has demonstrated some revenue growth, the substantial decline in net profit and operating margins highlights significant operational issues that need to be addressed. The financial results underscore the need for strategic initiatives to improve profitability and stabilize earnings quality in a challenging media landscape.