TD Power Systems reports highest sales and profitability in recent quarter.

TD Power Systems, a midcap company in the capital goods industry, has recently declared its financial results for the quarter ending September 2024. According to the latest report, the company has shown positive performance in the second quarter of the fiscal year 2024-2025. This is consistent with the company's performance in the last three months.

The company's net sales for the quarter were at its highest in the last five quarters, reaching Rs 306.44 crore. This indicates a positive trend in near term sales. Additionally, the operating profit (PBDIT) for the quarter was also at its highest in the last five quarters, at Rs 55.61 crore. The operating profit margin has also improved, reaching its highest at 18.15%. This shows an increase in the company's efficiency.

The profit before tax (PBT) less other income for the quarter was at its highest in the last five quarters, at Rs 49.83 crore. The profit after tax (PAT) for the quarter was also at its highest in the last five quarters, at Rs 41.27 crore. This shows a positive trend in near term profitability, with a growth of 25.9% year on year.

The company's earnings per share (EPS) for the quarter were at its highest in the last five quarters, at Rs 2.64. This indicates an increase in profitability and higher earnings for shareholders. The company's cash and cash equivalents for the half yearly period were also at its highest in the last six periods, at Rs 233.30 crore. This shows an improvement in short term liquidity.

However, there are some areas that need improvement for TD Power Systems. The debtors turnover ratio for the half yearly period was at its lowest in the last five periods, at 2.82 times. This indicates a slower pace in settling debtors. Additionally, the non operating income for the quarter was at its highest in the last five quarters, at Rs 6.15 crore. While this may seem positive, it is important to note that this income may not be sustainable as it comes from non-business activities.

Overall, TD Power Systems has shown positive financial performance in the recent quarter, with an increase in sales, profitability, and cash reserves. However, the company should focus on improving its debtors turnover ratio and ensuring sustainable sources of income. Based on these factors, MarketsMOJO has given a 'Hold' call for the company's stock.