Thirumalai Chemicals' Q2 financials show mixed results, with growth in PAT but concerns over debt and liquidity

Thirumalai Chemicals, a smallcap company in the chemicals industry, recently declared its financial results for the quarter ending September 2024. According to the report, the company's performance has remained flat in the second quarter of the fiscal year 2024-2025. This is reflected in the score given by MarketsMOJO, which has fallen from 2 to 1 in the last 3 months.

However, there are some positive aspects to Thirumalai Chemicals' financials. The company's Profit After Tax (PAT) for the half-yearly period has shown a significant growth of 114.62% compared to the same period last year. This trend is very encouraging for the company. Additionally, the PAT for the half-yearly period is higher than the preceding 12 months, indicating a strong performance in the first half of the fiscal year.

On the other hand, there are some areas of concern for Thirumalai Chemicals. The company's Debt-Equity Ratio for the half-yearly period is at its highest at 1.14 times and has been growing each half-year in the last five periods. This suggests that the company is relying more on borrowing to fund its operations, which could lead to a stressed liquidity situation. Moreover, the company's Non-Operating Income for the quarter is 101.75% of its Profit Before Tax (PBT), indicating a high reliance on non-business activities for income, which may not be sustainable in the long run.

The company's Cash and Cash Equivalents for the half-yearly period is at its lowest in the last six periods, indicating a deteriorating short-term liquidity situation. Additionally, the Debtors Turnover Ratio for the half-yearly period is at its lowest in the last five periods, suggesting a slower pace of settling debts. Furthermore, Thirumalai Chemicals' Dividend Payout Ratio (DPR) for the last five years is at its lowest at -26.40%, indicating a lower distribution of profits as dividends.

Lastly, the company's Non-Operating Income for the quarter is at its highest in the last five quarters, which may not be sustainable in the long run. Overall, Thirumalai Chemicals' financial performance for the quarter ending September 2024 has been mixed, with some positive and negative aspects. Investors are advised to carefully analyze the company's financials before making any investment decisions.