Kanchi Karpooram Faces Financial Challenges Amid Declining Sales and Profits

Kanchi Karpooram, a microcap player in the commodity chemicals sector, has recently undergone an adjustment in its evaluation. This revision reflects the company's ongoing financial trends and market position. Over the past five years, Kanchi Karpooram has experienced a decline in net sales, with an annual growth rate of -15.80%. Operating profit has also shown a negative trajectory, registering a -2.73% change during the same period.
In the most recent quarter, the company reported a significant drop in key financial metrics. The profit after tax (PAT) for the nine months ending June 2025 stood at Rs 3.45 crore, reflecting a decline of -64.94%. Additionally, the profit before tax (PBT) less other income for the quarter was Rs 1.94 crore, which fell by -45.8% compared to the previous four-quarter average. Net sales for the quarter were recorded at Rs 35.87 crore, down by -5.3% from the previous four-quarter average.

Despite these challenges, Kanchi Karpooram maintains a low debt-to-equity ratio and an attractive valuation, with a return on equity (ROE) of 6.5 and a price-to-book value of 0.8. The stock is currently trading at a discount relative to its peers' historical valuations.

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