SP Apparels Faces Mixed Financial Indicators Amid Record Sales and Rising Costs

SP Apparels, a small-cap player in the Garments & Apparels industry, has recently undergone an evaluation adjustment that reflects notable shifts in its financial metrics and overall market position. The company's financial performance for the quarter ending March 2025 has been characterized as flat, despite achieving record highs in net sales, PBDIT, PBT, and PAT. Specifically, net sales reached Rs 399.21 crore, while PAT stood at Rs 30.41 crore, indicating a solid operational foundation.
However, the company faces challenges, including a significant increase in interest expenses, which grew by over 102% to Rs 28.18 crore, and a low cash reserve of Rs 41.29 crore. The debt-equity ratio has also reached a peak of 0.45 times, raising concerns about financial leverage.

On the quality front, SP Apparels has seen an upgrade in its quality grade, attributed to consistent sales growth and a favorable EBIT to interest ratio. The valuation metrics have shifted to an attractive grade, with a PE ratio of 22.40 and an EV to EBITDA of 13.09, suggesting a competitive positioning relative to peers.

Overall, the recent evaluation adjustment highlights the company's mixed performance indicators, reflecting both strengths and areas requiring attention.

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