Vintage Coffee & Beverages Reports Strong Growth Amidst Market Challenges and Debt Concerns

Vintage Coffee & Beverages has recently undergone an adjustment in its evaluation, reflecting the company's ongoing performance and market dynamics. The small-cap player in the Tea/Coffee industry has reported notable financial metrics for the third quarter of FY24-25, showcasing a robust annual growth rate in net sales of 101.57% and an impressive operating profit increase of 418.34%.
The company has consistently delivered positive results over the last ten consecutive quarters, with a net profit growth of 247.08% reported in December 2024. Key performance indicators highlight a strong inventory turnover ratio, which stands at 2.34 times, and the highest net sales recorded at Rs 88.15 crore. Additionally, the operating profit to interest ratio is at 11.57 times, indicating a solid operational footing.

Despite these strengths, the technical trend has shown signs of sideways movement, suggesting a lack of clear price momentum. The company’s return on capital employed (ROCE) is noted at 7.2, presenting an attractive valuation relative to its peers. However, challenges such as a high debt to EBITDA ratio of 7.84 times and a significant percentage of pledged promoter shares may raise concerns regarding management efficiency and debt servicing capabilities.

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