KG Petrochem Faces Financial Challenges Amidst Growth in Net Sales and Low Debt Levels

KG Petrochem, a microcap player in the Garments & Apparels industry, has recently undergone a financial trend adjustment reflecting challenges in its performance metrics. The company's financial results for the quarter ending September 2025 indicate a decline, with a notable drop in its score over the past three months.
On a positive note, KG Petrochem has reported net sales of Rs 178.73 crore over the last six months, showcasing a growth rate of 22.33%. Additionally, the company maintains a low debt-equity ratio of 0.47 times, indicating a manageable level of debt. The debtors turnover ratio stands at a robust 4.79 times, suggesting efficient collection practices.

However, the company faces significant hurdles. Interest expenses have surged to Rs 7.62 crore, reflecting a growth of 51.49%. The profit after tax for the quarter is reported at Rs -0.22 crore, a stark decline of 214.3%. Other concerning metrics include the lowest operating profit to interest ratio at 1.09 times and a PBDIT of just Rs 1.77 crore.

In terms of market performance, KG Petrochem's stock has shown mixed results compared to the Sensex. Over the past year, the stock has returned 16.45%, while the Sensex has returned 9.03%. However, year-to-date, KG Petrochem has underperformed with a return of -15.18% against the Sensex's 8.41%. The company's long-term performance remains noteworthy, with a five-year return of 176.27% compared to the Sensex's 94.99%.