Suryalata Spinning Mills Adjusts Outlook Amid Strong Profit Growth and Low Debt Levels
Suryalata Spinning Mills has recently adjusted its evaluation, reflecting a shift in its technical outlook. The company reported a strong operating profit to interest ratio of 10.35 times and a profit after tax of Rs 5.84 crore, showing significant growth. However, challenges remain with past operating profit trends and pledged promoter shares.
Suryalata Spinning Mills, operating within the Garments & Apparels industry, has recently undergone an adjustment in its evaluation. This revision reflects a shift in the technical landscape, moving from a sideways trend to a mildly bullish outlook. Key financial metrics indicate that the company has shown positive performance in the latest quarter, with a notable operating profit to interest ratio reaching 10.35 times. Additionally, the profit after tax for the quarter stood at Rs 5.84 crore, marking a significant growth of 51.9% compared to the previous four-quarter average. The debt-equity ratio is at a low of 0.26 times, suggesting a favorable financial structure.
Despite a year-over-year stock return of -12.53%, Suryalata Spinning Mills has experienced a 35.8% increase in profits, with a PEG ratio of 0.2 indicating attractive valuation metrics. However, the company has faced challenges with a -7.53% CAGR growth in operating profits over the past five years and a Return on Equity averaging 6.84%, reflecting lower profitability per unit of shareholder funds.
The presence of pledged promoter shares, accounting for 35.98%, may also influence market perceptions.
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