Gloster Ltd's Financial Performance Sees Significant Decline, MarketsMOJO Gives 'Strong Sell' Call

Gloster Ltd, a microcap textile company, has recently announced its financial results for the quarter ending September 2024. The company has seen a significant decline in its financial performance, with a score of -31 compared to -26 in the previous quarter.

According to the financial report, the company's profit before tax (PBT) has fallen by 187.76% year on year, with a negative trend in the near term. Similarly, the profit after tax (PAT) has also decreased by 151.0% year on year, indicating a very negative trend in the near future.

The operating cash flow for the company has been consistently falling in the last three years, with the lowest being Rs 38.01 crore in the last financial year. This suggests that the company's cash revenues from business operations are declining.

The net sales for the quarter have also seen a decline of 12.05% year on year, indicating a very negative trend in the near term. The interest cost for the company has increased by 34.54% quarter on quarter, which could be a result of increased borrowings.

The debt-equity ratio for the company has been consistently growing in the last five half-yearly periods, reaching its highest at 0.31 times. This suggests that the company is relying more on borrowings to fund its operations, which could lead to a stressed liquidity situation.

The non-operating income for the company is 1,902.70% of the PBT, indicating a high income from non-business activities. However, this may not be a sustainable business model. The non-operating income has also seen a significant increase in the last five quarters, which may not be sustainable in the long run.

Based on these financial results, MarketsMOJO has given a 'Strong Sell' call for Gloster Ltd's stock. Investors are advised to carefully consider these financials before making any investment decisions.