Granules India's Q2 Financial Results Show Mixed Performance, Investors Advised to Hold

Granules India, a midcap pharmaceutical company, recently announced its financial results for the quarter ending September 2024. The company's stock has been given a 'Hold' call by MarketsMOJO.

According to the financials, Granules India has seen a negative performance in the second quarter of the fiscal year 2024-2025, with a score of -11 compared to 14 in the previous quarter. However, there are some positive aspects to the company's financials.

One of the strengths of Granules India is its debt-equity ratio, which is at its lowest in the last five half-yearly periods at 0.32 times. This indicates that the company has been reducing its borrowing in comparison to its equity capital. Additionally, the company has also been able to settle its debtors faster, with a highest debtors turnover ratio of 6.12 times in the last five half-yearly periods.

On the other hand, there are some areas of concern for Granules India. The profit before tax (PBT) less other income has fallen by 23.8% in the current quarter compared to the average of the previous four quarters. The same trend can be seen in the profit after tax (PAT) and net sales, which have both fallen by 21.0% and 17.7% respectively. The company's ability to manage interest payments has also deteriorated, with the lowest operating profit to interest ratio in the last five quarters.

Furthermore, the company's near-term trends for PBT, operating profit, and sales are all negative. The earnings per share (EPS) have also declined, indicating a lower profitability for shareholders. The company's short-term liquidity is also deteriorating, with the lowest cash and cash equivalents in the last six half-yearly periods.

It is worth noting that Granules India has seen an increase in non-operating income, which may not be sustainable in the long run. Overall, the financial results for the quarter ending September 2024 show a mix of positive and negative aspects for Granules India. Investors are advised to hold their position and monitor the company's performance in the upcoming quarters.