Oriental Carbon & Chemicals Reports Negative Performance in Q1 FY25, MarketsMOJO Gives 'Sell' Call

Oriental Carbon & Chemicals, a microcap company in the chemicals industry, recently announced its financial results for the quarter ending June 2024. According to the report released on August 12, 2024, the company has seen a negative performance in this quarter with a score of -19, a significant decrease from -2 in the previous three months.

Despite this decline, there are some positive aspects to Oriental Carbon’s financials. The company has shown a strong operating cash flow, with an annual high of Rs 94.44 crore and consistent growth over the past three years. Additionally, the company has been distributing higher dividends to its shareholders, with a DPS of Rs 14.00 in the last five years.

However, there are also some concerning factors in the financial report. The profit after tax (PAT) for this quarter has fallen by 30.7% year on year, with a total of Rs 3.14 crore. The net sales for this quarter are also at a five-quarter low of Rs 18.68 crore, indicating a negative trend in the company’s sales. The operating profit (PBDIT) for this quarter is also at its lowest in the last five quarters, with a total of Rs 1.66 crore. This shows a negative trend in the company’s operating profit.

Furthermore, the company’s efficiency has deteriorated, with the operating profit margin at its lowest in the last five quarters at 8.89%. Additionally, the debtors turnover ratio for the last five half-yearly periods is at its lowest of 3.15 times, indicating a slowdown in the company’s pace of settling its debtors.

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