Automotive Axles reports flat performance in Q2, strong operating cash flow and dividend distribution

Despite the flat financial performance in the second quarter of FY24-25, Automotive Axles has shown some positive signs in its operating cash flow and dividend distribution. However, the company has also faced challenges in terms of declining profit before tax and after tax, as well as a decrease in net sales.

According to the financial results declared on October 30, 2024, Automotive Axles, a smallcap auto ancillary company, has reported a flat performance for the quarter. The company's score has improved from -6 to -5 in the last three months.

One of the key highlights of the financial report is the company's strong operating cash flow, which has been consistently growing over the past three years and is currently at its highest at Rs 260.16 crore annually. This indicates that the company has been able to generate higher cash revenues from its business operations.

Another positive aspect is the company's dividend per share (DPS), which has been consistently increasing over the past five years and is currently at its highest at Rs 32.00. This shows that the company is distributing higher dividends from its profits.

However, there are also some areas of concern for Automotive Axles. The profit before tax (PBT) less other income has fallen by 25.03% year on year, and the profit after tax (PAT) has also decreased by 20.2% year on year. This indicates a negative trend in the near term for the company's profitability.

Additionally, the net sales for the quarter have also declined by 15.35% year on year, indicating a negative trend in the near term for the company's sales.

Overall, while Automotive Axles has shown some positive signs in its financial performance, there are also some challenges that the company needs to address in order to improve its profitability and sales. The stock call for the company by MarketsMOJO is currently 'Sell'.