TVS Supply Chain Solutions Reports Positive PAT Growth, But Concerns Remain

TVS Supply Chain Solutions, a midcap logistics company, recently announced its financial results for the quarter ending September 2024. The company's stock has been given a 'Sell' call by MarketsMOJO.

According to the financial report, TVS Supply has shown positive performance in the second quarter of FY24-25. However, the company's overall score has fallen from 19 to 7 in the last three months.

One of the key highlights of the financials is the significant growth in Profit After Tax (PAT) for the quarter. The company's PAT has increased by 613.3% to Rs 9.33 crore, compared to the average PAT of the previous four quarters which was at Rs -1.82 crore. This indicates a very positive trend in the near term for TVS Supply.

On the other hand, the Profit Before Tax less Other Income (PBT) for the quarter has decreased by -391.0% to Rs -10.79 crore, compared to the average PBT of the previous four quarters which was at Rs -2.20 crore. This shows a very negative trend in the near term for the company.

TVS Supply's operating cash flow for the year has also been a cause for concern, with it being the lowest at Rs 127.58 crore in the last three years. This indicates a decline in the company's cash revenues from business operations.

Furthermore, the company's operating profit margin for the quarter has been the lowest in the last five quarters at 6.72%. This suggests a deterioration in the company's efficiency.

Another point of concern is the high non-operating income, which is 160.52% of the Profit Before Tax (PBT). This indicates that the company's income from non-business activities is high, which may not be a sustainable business model. Additionally, the non-operating income for the quarter has been the highest in the last five quarters at Rs 28.62 crore.

Overall, while TVS Supply has shown positive financial performance in terms of PAT, there are some areas of concern that need to be addressed. Investors are advised to carefully evaluate the company's financials before making any investment decisions.