Mangalam Organics Shows Positive Growth in Q2 Financial Results, But Debt-Equity Ratio Raises Concerns

Mangalam Organics, a microcap company in the chemicals industry, has recently declared its financial results for the quarter ending September 2024. According to the data, the company has shown positive performance in the second quarter of the fiscal year 2024-2025, with a score of 18, an improvement from 15 in the last three months.

The company's Profit After Tax (PAT) for the half-yearly period has grown by 306.38% year on year, reaching Rs 3.82 crore. This trend is very positive for the company. Additionally, the Profit Before Tax less Other Income (PBT) for the quarter has also shown significant growth of 140.6% compared to the average PBT of the previous four quarters, which was Rs 1.24 crore. This indicates a positive trend in the near term for PBT.

Mangalam Organics has also shown a strong ability to manage its interest payments, with the Operating Profit to Interest ratio being the highest in the last five quarters at 2.97 times. The company's Operating Profit (PBDIT) for the quarter has also been the highest at Rs 12.34 crore, showing growth in each of the last five quarters. This indicates a positive trend in the near term for Operating Profit.

However, the company's Debt-Equity Ratio for the half-yearly period has been the highest in the last five periods at 0.94 times. This suggests that the company is borrowing more to fund its operations, which may lead to a stressed liquidity situation.

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