GTL's Financial Results Show Decline in Key Areas, Raises Concerns for Investors

GTL, a microcap telecom equipment company, recently announced its financial results for the quarter ending December 2023. According to the data released on February 7, 2024, the company's performance has remained flat compared to the previous quarter. This has resulted in a decrease in the company's score from 10 to 0 in the last three months.

The financials for the quarter have raised concerns for GTL, as there has been a decline in key areas. The Profit Before Tax (PBT) has fallen by 23.9% to Rs 1.22 crore, compared to the average PBT of the previous four quarters, which was Rs 1.60 crore. This trend is expected to continue in the near term. Similarly, the Profit After Tax (PAT) has also decreased by 33.8% to Rs 3.82 crore, compared to the average PAT of the previous four quarters, which was Rs 5.77 crore.

The company's Debtors Turnover Ratio, which measures the pace of settling its debtors, has also seen a decline. It is currently at its lowest at 2.29 times and has fallen in the last five half-yearly periods. This indicates that the company's pace of settling its debtors has slowed down.

In terms of sales, GTL has reported its lowest net sales of Rs 43.46 crore in the last five quarters. The net sales have also decreased by 6.4% compared to the average net sales of the previous four quarters, which was Rs 46.41 crore. This shows a negative trend in the company's sales in the near term.

Another concerning factor is the company's high non-operating income, which accounts for 68.06% of its PBT. This indicates that the company's income from non-business activities is high, which is not a sustainable business model.

Based on these financial results, MarketsMOJO has given a 'Sell' call for GTL's stock. Investors should carefully consider these factors before making any investment decisions.