Pitti Engineering Reports Positive Q2 Results, PAT Increases by 60%

Pitti Engineering, a smallcap company in the engineering industry, recently announced its financial results for the quarter ending September 2024. The stock call for the company by MarketsMOJO is 'Hold'.

According to the financials, Pitti Engineering has shown a positive performance in the second quarter of FY24-25. The company's score has improved from 7 to 13 in the last 3 months. This improvement can be attributed to various factors.

One of the key highlights of the financials is the growth in Profit After Tax (PAT) which has increased by 60.0% to Rs 38.02 crore compared to the average PAT of the previous four quarters which was Rs 23.76 crore. The company's net sales have also shown a positive trend, with the highest quarterly net sales of Rs 429.36 crore in the last five quarters. The operating profit (PBDIT) has also seen a significant increase, reaching its highest at Rs 66.07 crore in the last five quarters. This indicates a positive trend in the company's efficiency.

Another positive aspect of the financials is the decrease in Debt-Equity Ratio, which is now at its lowest at 0.65 times in the last five half yearly periods. This shows that the company has been reducing its borrowing as compared to equity capital.

However, there are some areas that need improvement for Pitti Engineering. The company's operating cash flow has been decreasing, with the lowest at Rs 73.59 crore in the last three years. The interest cost has also increased by 10.33% (QoQ), indicating higher borrowings. Additionally, the non-operating income is 48.69% of the Profit Before Tax (PBT), which is not a sustainable business model.

Overall, Pitti Engineering has shown a positive financial performance in the quarter ending September 2024. The company's efforts to reduce its debt and improve its efficiency are commendable. However, there are some areas that need attention for sustained growth in the future.