Servotech Renewable Power Faces Financial Struggles Amid Declining Profitability and Sales

Servotech Renewable Power System has recently undergone a significant evaluation revision, reflecting a challenging financial landscape for the company. In the quarter ending September 2025, Servotech reported its lowest operating profit to interest ratio at 2.42 times, indicating difficulties in managing its debt obligations. The company's PBDIT also reached a low of Rs 6.28 crore, while profit before tax (PBT) was recorded at Rs -0.63 crore, further highlighting operational struggles.
Net sales for the quarter were reported at Rs 106.49 crore, marking a concerning trend in revenue generation. Additionally, the interest expense was the highest at Rs 2.60 crore, which has adversely impacted profitability. The operating profit to net sales ratio stood at just 5.90%, underscoring the challenges in converting sales into profit. The earnings per share (EPS) also fell to Rs 0.06, reflecting the company's current financial strain.

In terms of market performance, Servotech's stock has faced notable declines over various periods, with a year-to-date return of -36.59%, contrasting sharply with the Sensex's positive return of 8.41%. This disparity emphasizes the company's struggles relative to broader market trends, particularly in the short term.