Delta Corp's Q2 FY25 Financial Results Show Mixed Performance, Investors Advised to Proceed with Caution

Nov 18 2024 10:23 AM IST
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Delta Corp, a smallcap company in the hotel, resort, and restaurant industry, has reported a negative performance in the quarter ending September 2024, with a score of -22. However, the company has shown a strong operating cash flow and consistent growth in the last three years. Concerning factors include a decrease in profit and net sales, high non-operating income, and a slower pace in settling debtors. MarketsMojo has given a 'Sell' call for the company's stock based on these financials.

Delta Corp, a smallcap company in the hotel, resort, and restaurant industry, recently declared its financial results for the quarter ending September 2024. According to the data, the company has seen a very negative performance in this quarter, with a score of -22, which has improved from -27 in the last three months.


However, there are some positive aspects to Delta Corp’s financials. The company has shown a strong operating cash flow annually, with the highest amount of Rs 170.29 crore and a consistent growth in the last three years. This indicates that the company has been able to generate higher cash revenues from its business operations.


On the other hand, there are some concerning factors in the financials as well. The profit before tax (PBT) has fallen by -51.5% compared to the average PBT of the previous four quarters, and the profit after tax (PAT) has also fallen by -31.7% compared to the average PAT of the previous four quarters. The net sales have also decreased by -11.3% compared to the average net sales of the previous four quarters. This shows a very negative trend in the near term for Delta Corp.


Another concerning aspect is the company’s high non-operating income, which accounts for 49.27% of the PBT. This indicates that the company’s income from non-business activities is high, which may not be a sustainable business model.


Moreover, the company’s debtors turnover ratio is at its lowest in the last five half-yearly periods, indicating a slower pace in settling its debtors. Additionally, the non-operating income has been the highest in the last five quarters, which may not be sustainable in the long run.


In conclusion, Delta Corp’s financial results for the quarter ending September 2024 have shown a mix of positive and negative aspects. Investors should carefully consider these factors before making any investment decisions. MarketsMOJO has given a ‘Sell’ call for the company’s stock based on these financials.


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