Are TTK Healthcare latest results good or bad?

TTK Healthcare's latest financial results for Q2 FY26 present a complex picture of operational performance. The company reported a net profit of ₹20.39 crores, reflecting an 18.55% increase year-on-year, while revenue reached ₹203.57 crores, showing a modest 2.56% growth compared to the same quarter last year. However, this growth is juxtaposed with concerning operational trends.
The operating margin, excluding other income, fell sharply to 2.62%, significantly below the five-year average of 4.2%. This decline indicates a deterioration in core operational efficiency, as the company struggles to maintain profitability amidst rising employee costs, which constituted a larger portion of revenue. The operating profit before depreciation, interest, and tax (excluding other income) was only ₹5.33 crores, highlighting the challenges faced in generating sustainable earnings from core operations.

Additionally, TTK Healthcare's reliance on other income is notable, with 89.25% of profit before tax derived from this source, raising questions about the sustainability of its earnings. The company’s return on equity (ROE) has also declined to 6.33%, well below its historical average, suggesting reduced capital efficiency.

Overall, while TTK Healthcare has shown some positive trends in net profit and revenue growth year-on-year, the underlying operational challenges, particularly the significant drop in operating margins and heavy dependence on non-operating income, indicate a need for strategic improvements. The company saw an adjustment in its evaluation, reflecting these ongoing operational difficulties.