Tega Industries reports mixed financial results for Q2 FY25, with some positive and negative trends

Tega Industries, a midcap company in the capital goods industry, recently announced its financial results for the quarter ending September 2024. The stock call by MarketsMOJO for Tega Industries is ‘Hold’.

According to the financials, Tega Industries has seen a negative performance in the second quarter of FY24-25, with a score of -13 compared to 3 in the previous quarter. However, there are some positive aspects to the company’s financials. The operating cash flow for the year is the highest at Rs 252.14 crore and has been growing consistently over the past three years. This indicates that the company has generated higher cash revenues from its business operations. Additionally, the debt-equity ratio for the last five half-yearly periods is the lowest at 0.23 times, showing that the company has been reducing its borrowing in comparison to its equity capital.

On the other hand, there are some areas of concern in Tega Industries’ financials. The profit before tax less other income (PBT) for the quarter has fallen by -96.2% compared to the average PBT of the previous four quarters. The same trend is seen in the profit after tax (PAT), which has fallen by -86.2% compared to the average PAT of the previous four quarters. The company’s ability to manage interest payments has also deteriorated, with the operating profit to interest ratio being the lowest in the last five quarters. The net sales for the quarter have also fallen by -9.7% compared to the average net sales of the previous four quarters, indicating a negative trend in sales. The operating profit and operating profit margin for the quarter are also the lowest in the last five quarters, showing a decline in the company’s efficiency.

Furthermore, the non-operating income for the quarter is 85.38% of the PBT, which is a cause for concern as it indicates a high income from non-business activities. The earnings per share (EPS) for the quarter are also the lowest in the last five quarters, indicating a decline in profitability and lower earnings for shareholders. The non-operating income for the quarter is the highest in the last five quarters, which may not be sustainable in the long run.

Overall, Tega Industries’ financial performance for the quarter ending September 2024 has been negative, with some positive and negative aspects. Investors are advised to hold their stock and monitor the company’s performance in the coming quarters.