Are The Hi-Tech Gear latest results good or bad?

The latest financial results for Hi-Tech Gears for the quarter ended September 2025 reveal a mixed operational performance. The company reported net sales of ₹240.74 crores, reflecting an 11.69% sequential increase from the previous quarter, indicating some recovery in demand. However, this figure represents a 2.29% decline compared to the same quarter last year, marking the third consecutive quarter of year-on-year revenue contraction.
Net profit for the quarter was ₹6.01 crores, showing a slight sequential improvement of 0.17% from the previous quarter. In contrast, the year-on-year comparison indicates a significant decline of 37% in profitability, raising concerns about the company's ability to maintain its profit levels amidst rising costs and competitive pressures.

Operating margins have also come under pressure, with the operating margin reported at 11.82%, down from 14.60% in the same quarter last year. This decline reflects the challenges the company faces in sustaining pricing power while managing increasing input costs. The profit after tax (PAT) margin decreased to 2.56%, down from 3.96% year-on-year, further highlighting the operational difficulties.

Additionally, Hi-Tech Gears has made strides in improving its balance sheet, significantly reducing its long-term debt from ₹219.63 crores to ₹21.69 crores over the past two years. This deleveraging has enhanced the company's interest coverage ratio, providing some financial stability.

Overall, while there are signs of sequential improvement in certain metrics, the year-on-year performance raises concerns about the sustainability of profitability and operational efficiency. The company saw an adjustment in its evaluation, reflecting these ongoing challenges and the broader context of the automotive component sector.