Are Sri Ramakrishna Mills (Coimbatore) Ltd latest results good or bad?

Sri Ramakrishna Mills (Coimbatore) Ltd has reported significantly challenging financial results for the third quarter of FY26. The company experienced a net loss of ₹1.09 crores, marking its second consecutive quarter of losses. This financial distress is underscored by a substantial decline in net sales, which fell to ₹14.08 crores, representing a 30.80% decrease compared to the previous quarter. This decline is noted as the steepest in recent operational history, reflecting severe demand weakness within the textile spinning industry. The nine-month performance for FY26 also reveals concerning trends, with accumulated losses of ₹2.86 crores, indicating a 37.87% deterioration compared to the same period last year. The company's return on equity (ROE) has turned negative at -12.35%, suggesting that it is currently destroying shareholder value. The operational metrics indicate that the company is grappling with significant capacity underutilization, as evidenced by the sharp revenue contraction and the inability to cover basic operational expenses. Additionally, the company’s balance sheet shows high financial leverage, with a debt-to-equity ratio of approximately 1.75 times, which limits its flexibility to navigate current operational challenges. The absence of institutional investor support further complicates the company’s situation, as there are no holdings from foreign institutional investors or mutual funds, indicating a lack of confidence in the company's recovery prospects. Overall, the financial results reflect a company facing severe operational headwinds, with a notable adjustment in its evaluation due to the deteriorating fundamentals and operational performance. The outlook remains uncertain, with key concerns surrounding revenue stability, profitability, and debt servicing capabilities.