Are Shiva Mills Ltd latest results good or bad?

Shiva Mills Ltd's latest financial results for Q3 FY26 reveal a complex picture of operational challenges despite a sequential recovery in revenue. The company reported net sales of ₹34.26 crores, reflecting a 12.55% increase from the previous quarter, breaking a two-quarter decline. However, this figure is still 4.78% lower compared to the same period last year, indicating ongoing difficulties in achieving year-over-year growth. The operational metrics present a concerning trend, particularly in profitability. The company recorded a net loss of ₹0.71 crores, which represents a significant widening of losses compared to ₹0.16 crores in the prior quarter. This has resulted in a negative PAT margin of -2.07%. Moreover, the operating margin has contracted sharply to 1.84%, down from 4.50% in Q2 FY26, highlighting issues with cost management and pricing pressures within the textile sector. The financial performance indicates a troubling disconnect between revenue growth and profitability, as the increase in sales has not translated into improved bottom-line results. The company's average return on equity has turned negative, reflecting ongoing losses and inefficiencies in capital deployment. Additionally, the operational environment remains challenging, with the textile sector facing headwinds such as weak global demand and intense competition. In terms of evaluation, Shiva Mills has experienced an adjustment in its evaluation, reflecting the underlying financial and operational challenges. The company maintains a relatively healthy balance sheet with zero long-term debt, but the erosion of shareholder equity and the absence of institutional interest raise concerns about its future prospects. Overall, while there has been a sequential recovery in revenue, the persistent losses, margin compression, and negative returns on capital underscore the significant operational hurdles that Shiva Mills Ltd continues to face.