Manaksia Steels' Financial Results Show Negative Performance, MarketsMOJO Calls 'Sell'

Manaksia Steels, a microcap company in the steel/sponge iron/pig iron industry, recently announced its financial results for the quarter ending September 2024. The stock call for the company by MarketsMOJO is 'Sell'.

According to the financials, Manaksia Steels has seen a very negative performance in the quarter, with a score of -29, which has improved from -32 in the last 3 months. The company's profit after tax (PAT) for the half-yearly period has decreased by 84.28% year on year, and the near-term trend for PAT is also negative.

The net sales for the quarter have fallen by 33.5% compared to the average net sales of the previous four quarters. This indicates a very negative trend in the company's sales. Additionally, the company's ability to manage interest payments has deteriorated, with the operating profit to interest ratio being the lowest at -2.37 times and falling each quarter in the last five quarters.

The interest cost for the nine-month period has also increased by 56.88%, which signifies increased borrowings for the company. The operating cash flow for the company has been the lowest in the last three years, at Rs -52.15 crore, indicating a decline in cash revenues from business operations.

The operating profit (PBDIT) for the quarter has been the lowest at Rs -3.10 crore in the last five quarters, and the operating profit margin has also decreased to -2.97%. This shows a decline in the company's efficiency. The profit before tax (PBT) less other income for the quarter has also been the lowest at Rs -5.94 crore in the last five quarters, and the near-term trend for PBT is negative.

The company's non-operating income for the quarter is 412.63% of the PBT, which indicates a high income from non-business activities. This may not be a sustainable business model for the company. The earnings per share (EPS) for the quarter have also decreased to the lowest at Rs 0.17, which shows a decline in profitability and lower earnings for shareholders.

The non-operating income for the quarter has been the highest at Rs 7.84 crore in the last five quarters, which may not be sustainable in the long run. Based on these financials, MarketsMOJO has given a 'Sell' call for Manaksia Steels.