STC's Q2 financial results show positive growth, but areas for improvement remain

State Trading Corporation of India (STC) has recently announced its financial results for the quarter ending September 2024. The company, which operates in the trading industry and falls under the microcap category, has received a 'Sell' call from MarketsMOJO.

Despite this, STC has shown positive financial performance in the second quarter of the fiscal year 2024-2025. The company's score has improved from 14 to 10 in the last three months. This can be attributed to its Profit After Tax (PAT) which has grown by 139.75% year on year, reaching Rs 47.22 crore. The trend for PAT is also positive, indicating a strong financial performance.

Moreover, STC's PAT for the half-yearly period is higher than the preceding 12-month period, which ended in September 2024. This shows that the company has already surpassed its PAT for the previous year in just six months.

In terms of operating profit, STC has recorded its highest figure in the last five quarters at Rs -10.05 crore. This indicates a positive trend in the near term. Similarly, the company's Profit Before Tax less Other Income (PBT) for the quarter is also the highest in the last five quarters at Rs -10.58 crore, showing a positive trend in the near term.

However, there are some areas that need improvement for STC. Its Non-Operating Income for the quarter is 153.41% of its PBT, which means that the company's income from non-business activities is high. This may not be a sustainable business model in the long run. Additionally, the company's Earnings per Share (EPS) for the quarter is at its lowest in the last five quarters at Rs -1.25, indicating a decline in profitability and lower earnings for shareholders.

Furthermore, STC's Cash and Cash Equivalents for the half-yearly period is at its lowest in the last six half-yearly periods at Rs 0.89 crore. This shows a deterioration in short-term liquidity.

Overall, STC has shown positive financial performance in the second quarter of the fiscal year 2024-2025. However, there are some areas that need improvement for the company to sustain its growth in the long run. Investors are advised to carefully consider these factors before making any investment decisions.