HeidelbergCement India's Q2 FY24-25 financials show decline in profits and sales

HeidelbergCement India, a smallcap company in the cement industry, recently announced its financial results for the quarter ending September 2024. The stock has been given a 'Hold' call by MarketsMOJO.

The company has seen a negative financial performance in the second quarter of FY24-25, with a score of -19 compared to 1 in the previous three months. However, there are some positive aspects to the company's financials based on the September 2024 report.

One of the strengths of HeidelbergCement India is its high operating cash flow, which has been the highest in the last three years at Rs 349.52 crore. This indicates that the company has generated higher cash revenues from its business operations.

On the other hand, there are some areas that are not working in the company's favor. The profit before tax less other income (PBT) for the quarter has fallen by -93.7% compared to the average PBT of the previous four quarters. The profit after tax (PAT) has also seen a decline of -71.1% compared to the average PAT of the previous four quarters. The net sales for the quarter have also fallen by -19.8% compared to the average net sales of the previous four quarters.

The company's ability to manage interest payments has also deteriorated, with the operating profit to interest ratio being the lowest in the last five quarters. The net sales for the quarter have also been the lowest in the last five quarters, indicating a negative trend in sales. The operating profit and operating profit margin have also seen a decline, while the PBT has been the lowest in the last five quarters.

Another concerning aspect is the company's high non-operating income, which is 83.85% of the PBT. This suggests that the company's income from non-business activities is high, which may not be a sustainable business model. The earnings per share (EPS) have also been the lowest in the last five quarters, indicating a decline in profitability and lower earnings for shareholders.

The company's debtors turnover ratio has also been the lowest in the last five half-yearly periods, indicating a slower pace in settling its debtors. Overall, HeidelbergCement India's financial performance for the quarter has been negative, with some concerning trends that need to be addressed.