Sumit Woods Quarterly Financial Trend Shows Marked Shift Amid Realty Sector Challenges

In the latest quarter, Sumit Woods reported net sales of ₹12.82 crores, marking the lowest quarterly figure in recent periods. Operating profit before depreciation, interest, and taxes (PBDIT) stood at ₹1.61 crores, also at a low point. The operating profit to net sales ratio was recorded at 12.56%, indicating margin contraction relative to prior quarters. Earnings per share (EPS) for the quarter was ₹0.06, reflecting subdued profitability. The profit after tax (PAT) was ₹0.29 crores, showing a decline of 91.3% compared to the average of the previous four quarters.

The company’s return on capital employed (ROCE) for the half year was 10.89%, the lowest recorded in recent periods, signalling a shift in capital efficiency. The operating profit to interest coverage ratio for the quarter was 0.94 times, indicating tighter interest coverage. On the positive side, Sumit Woods maintained a low debt-equity ratio of 0.38 times for the half year, which is the lowest in its recent history, and a high debtors turnover ratio of 28.25 times, suggesting efficient receivables management.

Sumit Woods’ stock price closed at ₹80.37, down 3.96% on the day, with a 52-week high of ₹151.74 and a low of ₹75.23. The stock’s recent returns have lagged behind the broader market benchmark, the Sensex. Over the past week, the stock recorded a return of -4.75% compared to the Sensex’s 0.84%. Year-to-date, Sumit Woods’ return was -43.8%, while the Sensex gained 9.58%. Over the one-year period, the stock’s return was -37.08%, contrasting with the Sensex’s 10.47% gain. However, over longer horizons such as three and five years, Sumit Woods outperformed the Sensex with returns of 257.2% and 874.18% respectively, compared to the Sensex’s 41.53% and 100.26%.

The recent adjustment in Sumit Woods’ financial trend parameter reflects a revision in its evaluation, highlighting challenges in profitability and margin sustainability amid the current realty sector environment. While the company’s capital structure remains conservative with low leverage, operational metrics such as operating profit margins and interest coverage have shown contraction in the latest quarter. Investors may consider these factors in the context of the company’s historical performance and sector dynamics.

Limited Time Only! Subscribe for Rs. 12,999 and get 1 Year of MojoOne + an Additional Year Completely FREE. Don't miss out on this exclusive offer. Claim Your Free Year →