Sarda Energy Reports Strong Q4 Growth Amid Rising Debt Concerns

Sarda Energy & Minerals has recently reported its financial results for the quarter ending December 2024, revealing a range of underlying trends. The company has experienced a notable adjustment in its evaluation, with its score shifting positively to 3 from -4 over the past three months.
In terms of performance, Sarda Energy's Profit Before Tax less Other Income (PBT) reached Rs 226.46 crore, reflecting a significant year-on-year growth of 110.37%. Additionally, net sales for the quarter amounted to Rs 1,319.14 crore, marking a year-on-year increase of 42.55%. The Profit After Tax (PAT) also showed strong growth, reaching Rs 197.36 crore, up 66.6% year-on-year. Furthermore, both net sales and operating profit (PBDIT) hit their highest levels in the last five quarters, indicating a positive near-term trend.

However, the company faces challenges as well. Interest expenses rose to Rs 64.20 crore, the highest in five quarters, indicating increased borrowings. The debt-equity ratio also reached its peak at 0.49 times, suggesting a growing reliance on debt for operations. Additionally, the debtors turnover ratio has declined, indicating a slower pace in settling receivables.

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