Bloom Dekor Q2 FY26: Losses Deepen as Revenue Plunges 45.63% Quarter-on-Quarter

With a market capitalisation of just ₹8.00 crores and the stock trading at ₹11.46 as of November 18, 2025, Bloom Dekor continues to grapple with persistent losses, negative book value of ₹-9.60 per share, and deteriorating operational metrics that have pushed the company into a precarious financial position. The stock has declined 27.47% from its 52-week high of ₹15.80, reflecting investor concern over the company's viability.

The September quarter results represent a continuation of Bloom Dekor's multi-year decline, with revenues showing a concerning pattern of volatility and negative operating margins persisting across recent quarters. The company's inability to generate positive cash flows from operations, combined with a negative shareholder equity base of ₹-6.58 crores as of March 2025, paints a picture of fundamental distress requiring urgent restructuring.

Financial Performance: Revenue Volatility and Persistent Losses

Bloom Dekor's Q2 FY26 financial performance revealed alarming deterioration across key metrics. Net sales of ₹1.12 crores represented a sharp 45.63% decline from the previous quarter's ₹2.06 crores, though showing a marginal 15.79% decline year-on-year from ₹1.33 crores in Q2 FY25. This sequential revenue collapse suggests severe demand challenges or operational disruptions that prevented the company from maintaining even its modest Q1 momentum.

Operating profitability remained deeply negative in Q2 FY26, with the company posting an operating loss (excluding other income) of ₹0.10 crores, translating to a negative operating margin of 8.93%. This represented a significant reversal from Q1 FY26's brief positive operating profit of ₹0.10 crores (4.85% margin), highlighting the company's inability to maintain operational viability even at higher revenue levels. Employee costs of ₹0.31 crores remained relatively stable but consumed 27.68% of revenues, indicating severe structural cost challenges.

The profit trajectory worsened through the income statement, with interest costs of ₹0.06 crores and depreciation of ₹0.10 crores pushing the loss before tax to ₹0.24 crores. After adjusting for a tax credit of ₹0.06 crores, the net loss stood at ₹0.18 crores, resulting in a negative PAT margin of 16.07%. The company's inability to generate positive earnings at any level of the income statement underscores fundamental business model challenges that extend beyond cyclical demand weakness.

Balance Sheet Distress: Negative Net Worth and High Leverage

Bloom Dekor's balance sheet as of March 2025 reveals a company in severe financial distress. Shareholder funds stood at a negative ₹6.58 crores, comprising share capital of ₹6.85 crores offset by accumulated losses reflected in reserves and surplus of ₹-13.43 crores. This negative net worth position, which has deteriorated from ₹-5.54 crores in March 2024, indicates that the company's liabilities exceed its assets, raising serious questions about its ability to continue as a going concern without substantial capital infusion or debt restructuring.

The debt burden remains substantial despite the company's diminished scale, with long-term debt of ₹12.14 crores unchanged from the previous year. Current liabilities of ₹3.42 crores included trade payables of ₹1.31 crores and other current liabilities of ₹1.70 crores, suggesting working capital pressures. On the asset side, fixed assets stood at ₹1.82 crores, down from ₹2.13 crores a year earlier, whilst current assets of ₹4.18 crores provided limited liquidity cushion given the negative equity base.

Multi-Year Decline: A Pattern of Deterioration

The September 2025 quarter results must be viewed within the context of Bloom Dekor's prolonged decline. Annual revenues have contracted from ₹40.00 crores in FY20 to just ₹4.00 crores in FY25, representing a catastrophic 90% decline over five years. This translates to a compound annual sales decline of 31.92%, far exceeding normal industry cyclicality and pointing to structural loss of market share, capacity constraints, or fundamental business model failure.

Operating profitability has been equally dismal on an annual basis. The company posted an operating profit (excluding other income) of essentially zero in both FY25 and FY24, compared to a positive ₹4.00 crores in FY20. More concerning were the massive losses in FY22 (operating loss of ₹19.00 crores on revenues of ₹21.00 crores) and FY23 (operating loss of ₹4.00 crores on revenues of ₹10.00 crores), suggesting periods of severe operational distress that the company has not recovered from.

The anomalous FY23 net profit of ₹21.00 crores (210% PAT margin) on revenues of just ₹10.00 crores, despite a negative operating profit, appears to stem from exceptional items or one-time gains rather than operational improvement, as evidenced by the immediate return to losses in subsequent years. This pattern of volatility, combined with consistently negative operational performance, underscores the absence of a sustainable business model at the company's current scale and cost structure.

Profitability Metrics: Deeply Negative Returns

Bloom Dekor's profitability metrics reflect the severity of its operational challenges. The company's average Return on Capital Employed (ROCE) over recent years stands at a deeply negative 34.04%, indicating that the company destroys value on the capital invested in the business. The latest ROCE of -24.94% shows some marginal improvement but remains deeply unsatisfactory, reflecting persistent inability to generate positive returns.

Return on Equity (ROE) metrics are not meaningful in the traditional sense given the company's negative book value. With shareholder equity at ₹-6.58 crores, the company technically has no equity base to generate returns upon. This negative net worth position fundamentally undermines any conventional valuation framework and positions the company as a distressed asset requiring comprehensive restructuring rather than a going concern suitable for equity investment.

Peer Comparison: Lagging Industry on Every Metric

Comparing Bloom Dekor to peers within the plastic products manufacturing sector highlights the company's relative weakness across all financial dimensions. The company's negative book value and loss-making status place it in a fundamentally different category from operational peers.

Bloom Dekor's negative price-to-book ratio of -1.17x is unique among peers and reflects its negative net worth. Whilst some peers are also loss-making, most maintain positive book values and healthier balance sheets. The company's debt-to-equity ratio of -1.67 appears favourable on paper but is misleading given the negative equity base—in reality, the company's debt burden is unsustainable relative to its asset base and earning power.

Valuation Analysis: Uninvestable at Any Price

Traditional valuation metrics are not applicable to Bloom Dekor given its loss-making status and negative book value. The company trades at ₹11.46 per share as of November 18, 2025, with a market capitalisation of just ₹8.00 crores. However, this market value stands against a negative book value of ₹-9.60 per share, meaning the market is ascribing some residual value to potential restructuring outcomes or asset liquidation scenarios rather than valuing the company as a going concern.

The company's EV/EBITDA multiple of -19.07x and EV/EBIT of -17.02x are negative and meaningless for valuation purposes, reflecting the company's negative earnings. The EV/Sales ratio of 3.78x might appear reasonable in isolation, but it is irrelevant when the company cannot convert those sales into positive cash flows or earnings. Any investment thesis would need to be based on a dramatic operational turnaround, substantial debt restructuring, or asset monetisation scenarios rather than traditional equity valuation frameworks.

Shareholding Pattern: Stable but Concerning Promoter Base

Bloom Dekor's shareholding pattern has remained remarkably stable over recent quarters, with promoter holding steady at 54.76% across the last five reported quarters through September 2025. The promoter group is led by Sunil Sitaram Gupta (31.96%), followed by Rupal Gupta (7.93%), Gupta Sunil Sitaram HUF (5.57%), and Karan Sunil Gupta (5.23%). Importantly, there is no promoter pledging, which eliminates one potential source of distress.

However, the complete absence of institutional investors—zero FII holdings, zero mutual fund holdings, zero insurance company holdings, and effectively zero other DII holdings—is highly concerning. This institutional vacuum reflects professional investors' assessment that the company's risk-return profile is unattractive, leaving the stock held primarily by retail investors (45.24% non-institutional holding) who may not fully appreciate the severity of the company's financial distress. The lack of institutional participation also means limited research coverage and market liquidity, further constraining any potential exit opportunities for investors.

Stock Performance: Underperformance Across All Timeframes

Bloom Dekor's stock performance has been dismal across virtually all measured timeframes, significantly underperforming both the Sensex benchmark and its sector peers. As of November 18, 2025, the stock traded at ₹11.46, down 0.09% on the day and sitting 27.47% below its 52-week high of ₹15.80. The stock has found some support above its 52-week low of ₹9.69, but remains 18.27% above that distressed level.

The most recent period shows accelerating weakness, with the stock down 10.75% over the past month, generating negative alpha of -11.61% versus the Sensex. Year-to-date performance stands at -2.22%, underperforming the benchmark's 8.36% gain by over 10 percentage points. Over longer horizons, the underperformance is even more pronounced: the stock has lost 27.70% over three years whilst the Sensex gained 37.31%, producing catastrophic negative alpha of -65.01%.

Even the five-year return of 56.99%, which appears positive in isolation, dramatically underperformed the Sensex's 91.65% gain, generating negative alpha of -34.66%. The 10-year performance is particularly devastating, with the stock down 57.56% whilst the Sensex surged 232.28%, resulting in negative alpha of nearly -290 percentage points. This persistent, multi-year underperformance across all timeframes reflects the market's accurate assessment of the company's deteriorating fundamentals and questionable viability.

Technical Analysis: Mildly Bearish Trend with Limited Support

From a technical perspective, Bloom Dekor's stock entered a "Mildly Bearish" trend on November 17, 2025 at ₹11.47, transitioning from a prior "Sideways" trend. The stock trades below all key moving averages—5-day MA (₹11.33), 20-day MA (₹11.92), 50-day MA (₹12.19), and 100-day MA (₹12.32)—indicating consistent downward pressure and lack of buying support at higher levels.

Technical indicators present a predominantly negative picture. The MACD shows bearish signals on both weekly and monthly timeframes, whilst Bollinger Bands indicate bearish to mildly bearish conditions. The KST oscillator suggests mildly bearish momentum, and Dow Theory points to either no trend or mildly bearish conditions. The sole positive indicator is the On-Balance Volume (OBV), which shows a bullish signal on the weekly timeframe, potentially indicating accumulation despite price weakness, though this must be viewed cautiously given the stock's minimal trading volumes (just 955 shares traded on November 18, 2025).

Investment Thesis: Distressed Asset Unsuitable for Equity Investment

Bloom Dekor's investment thesis is fundamentally compromised by its distressed financial condition. The company's Mojo Score of just 17 out of 100, along with a "STRONG SELL" rating, accurately reflects the severe risks facing investors. The valuation grade of "RISKY," quality assessment of "BELOW AVERAGE," "FLAT" financial trend, and "MILDLY BEARISH" technical trend combine to paint a picture of a company in comprehensive distress across all analytical dimensions.

The company's quality metrics are particularly concerning. With negative book value, five-year sales decline of 31.92%, deeply negative ROCE of -34.04%, and zero institutional holdings, Bloom Dekor fails to meet even basic quality thresholds for equity investment. The absence of dividend payments, combined with persistent losses and negative cash flow generation, eliminates any potential income component that might partially offset capital risk.

Outlook: Restructuring Required for Survival

Bloom Dekor's outlook is fundamentally challenged by its distressed financial condition and absence of visible catalysts for operational turnaround. The company requires comprehensive restructuring—potentially including debt renegotiation, fresh capital infusion, operational rightsizing, or strategic alternatives such as asset sales or merger—to address its negative net worth and establish a sustainable business model. Without such restructuring, the company faces continued value destruction and potential insolvency.