Are XPRO India Ltd latest results good or bad?

XPRO India Ltd's latest financial results for Q3 FY26 present a complex picture of operational performance. The company reported a net profit of ₹6.78 crores, reflecting a significant sequential recovery of 36.42% from the previous quarter, although it represents a decline of 9.24% compared to the same quarter last year. Net sales for the quarter were ₹106.31 crores, which shows a decrease of 11.34% from Q2 FY26 but a modest year-on-year growth of 1.68%. The operating margin, excluding other income, improved to 9.99%, a notable increase from 6.11% in the previous quarter, indicating a return to double-digit margins for the first time since Q3 FY25. However, this improvement follows a challenging period where the company faced a negative operating margin in Q2 FY26. The profit before tax also saw a recovery, reaching ₹9.80 crores, up 46.27% from the previous quarter, yet it remains below the figure from the same quarter last year. Despite these positive sequential trends, the broader context reveals ongoing operational challenges. The company's return on capital employed (ROCE) has significantly declined to 2.93%, far below its five-year average of 17.49%. Additionally, XPRO India has experienced a dramatic increase in long-term debt, which surged by over 930% year-on-year, raising concerns about its capital structure and financial stability. The company's reliance on non-operating income is also noteworthy, as it constituted 41.84% of profit before tax in Q3 FY26, suggesting potential vulnerabilities in core operational profitability. The shareholding pattern indicates a reduction in promoter stake, which may reflect diminished confidence in the company's prospects. Overall, XPRO India Ltd's financial results illustrate a company navigating through significant operational volatility, with some signs of recovery in the latest quarter but persistent underlying challenges. The company saw an adjustment in its evaluation, reflecting these mixed operational trends and financial metrics.