Hi-Tech Gears Reports Mixed Financial Results Amidst Debt Reduction and Liquidity Concerns in December 2024

The Hi-Tech Gears, a small-cap player in the auto ancillary industry, recently announced its financial results for the quarter ending December 2024. The evaluation changes reflect a notable shift in the company's financial standing, with the score experiencing a revision from 4 to -13 over the past three months.
On a positive note, The Hi-Tech Gears has achieved its lowest debt-equity ratio at 0.53 times over the last five half-year periods, indicating a consistent reduction in borrowing relative to equity capital. Additionally, the company has demonstrated efficiency in managing its receivables, achieving the highest debtors turnover ratio of 5.77 times in the same timeframe.

Conversely, several metrics indicate challenges for the company. Net sales for the quarter were recorded at Rs 205.06 crore, marking a significant decline compared to the average of the previous four quarters. Profit Before Tax less Other Income (PBT) and Profit After Tax (PAT) also reflected substantial decreases, with PBT at Rs 5.67 crore and PAT at Rs 6.87 crore, both at their lowest levels in the last five quarters. Furthermore, the operating profit margin has shown a decline, and cash and cash equivalents have reached their lowest point in six half-yearly periods, suggesting a deterioration in short-term liquidity.

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