Mangalam Cement Faces Financial Challenges Amidst Rising Promoter Confidence

Mar 13 2025 08:03 AM IST
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Mangalam Cement has recently adjusted its financial outlook following a challenging Q3 FY24-25 performance. Key metrics reveal difficulties in debt servicing and declining operating profits over five years. However, promoter confidence has increased, indicating potential long-term belief in the company's prospects despite current challenges.
Mangalam Cement has recently undergone an evaluation adjustment, reflecting a shift in its financial outlook. The company, operating within the small-cap cement industry, has reported a challenging financial performance for the quarter ending Q3 FY24-25. Key metrics indicate a weak ability to service its debt, highlighted by a low EBIT to Interest ratio of 1.91. Additionally, the Return on Equity stands at 9.03%, suggesting limited profitability relative to shareholders' funds.

Over the past five years, the company has experienced a decline in operating profit, with an annual growth rate of -10.34%. Recent results for December 2024 show a significant drop in profit after tax, which fell to Rs 7.81 crore, marking a decrease of 41.7%. Furthermore, non-operating income has constituted a substantial portion of profit before tax, raising concerns about the sustainability of earnings.

Despite these challenges, there has been a notable increase in promoter confidence, with a 0.87% rise in their stake, now totaling 37.81%. This development may reflect a belief in the company's long-term potential amidst current difficulties.

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