Greaves Cotton's Q1 Financial Results Show Decline in Performance, Experts Advise Hold

Greaves Cotton, a smallcap company in the diesel engine industry, recently announced its financial results for the quarter ending June 2024. According to MarketsMOJO, a leading stock analysis platform, the stock call for Greaves Cotton is 'Hold'.

The company has seen a negative financial performance in the quarter, with a score of -12 compared to -4 in the previous quarter. This decline can be attributed to various factors, including a significant decrease in Profit Before Tax (PBT) and Profit After Tax (PAT). The PBT has fallen by 124.4% compared to the average of the previous four quarters, while the PAT has fallen by 80.8%.

One of the major concerns for Greaves Cotton is its operating cash flow, which has been consistently falling over the last three years. In the latest financial year, the company's operating cash flow was at its lowest at Rs -153.04 crore. This indicates that the company's cash revenues from business operations are declining.

Another red flag for Greaves Cotton is its high non-operating income, which is 111.14% of its PBT. This means that the company's income from non-business activities is significantly higher than its income from core operations, which is not a sustainable business model.

Additionally, the company's dividend payout ratio (DPR) has been consistently low in the last five years, with the latest DPR at -34.30%. This indicates that the company is distributing a lower proportion of its profits as dividends.

Overall, the financial results for the quarter ending June 2024 have not been favorable for Greaves Cotton. Investors are advised to hold their positions and closely monitor the company's performance in the coming quarters.