Cheviot Company Faces Financial Struggles Amid Broader Textile Industry Decline

Cheviot Company, a microcap player in the textile industry, has seen significant activity today, hitting a new 52-week low of Rs. 973.2. This decline marks a notable performance dip, as the stock has fallen by 3.98% over the last two days. Despite this downturn, Cheviot Company managed to outperform its sector by 3.28% today, even as the broader textile industry faced a decline of 6.43%.
The company's recent financial metrics reveal a concerning trend, with net sales decreasing at an annual rate of 0.81% and operating profit declining by 5.51% over the past five years. The latest quarterly results show a sharp drop in profit after tax, falling by 80.8% to Rs. 3.44 crore. Additionally, Cheviot's inventory turnover ratio stands at a low 3.96 times, and the debtors turnover ratio is also at a low of 13.40 times.

Over the past year, Cheviot Company has underperformed against the benchmark, with a return of -24.50%, contrasting sharply with the Sensex's decline of only 2.24%. The stock is currently trading below all key moving averages, indicating a bearish technical trend.