TRF's Q1 FY25 Financial Results Show Mixed Performance, MarketsMOJO Issues 'Sell' Call

TRF, a microcap engineering company, recently announced its financial results for the quarter ending June 2024. According to the report, the company has seen a negative financial performance with a score of -17, which has improved from -20 in the last three months.

One of the positive aspects of TRF’s financials is its cash and cash equivalents, which have been the highest in the last six half-yearly periods at Rs 72.21 crore. This indicates an improvement in short-term liquidity for the company.

However, there are some areas that are not working in TRF’s favor. The Profit Before Tax less Other Income (PBT) for the quarter has fallen by 78.04% year on year, and the Profit After Tax (PAT) has also seen a decline of 34.7% year on year. This trend is expected to continue in the near term.

Another concerning factor is the company’s interest, which has grown by 31.30% over the previous half-yearly period. This suggests an increase in borrowings for TRF. Additionally, the Operating Profit (PBDIT) for the quarter is at its lowest in the last five quarters, and the Operating Profit Margin is also at its lowest in the last five quarters, indicating a deterioration in the company’s efficiency.

Moreover, the Non-Operating Income for the quarter is 77.56% of the Profit Before Tax (PBT), which is a high percentage. This suggests that the company’s income from non-business activities is significant, which may not be a sustainable business model.

Based on these financial results, MarketsMOJO has given a ‘Sell’ call for TRF’s stock. Investors should carefully consider these factors before making any investment decisions.