Magadh Sugar & Energy Ltd

Growth Ratio Summary

Growth Score : 6.00

The company demonstrates strong growth in operating profit, EPS, and asset growth, suggesting positive momentum in its core operations and asset base. However, revenue and net income growth are low, indicating potential challenges in top-line expansion and overall profitability. The positive growth in key areas like operating profit and EPS suggests improving operational efficiency and profitability. Overall, the company shows promising growth trends but needs to address its revenue and net income challenges to achieve sustainable financial expansion.

Financial Ratio Summary

Financial Score : 6.00

The company's financial ratios present a mixed view. While the dividend per share and capital expenditure scores are strong, the adjusted earnings per share score is low. The cash earnings per share and book value per share scores are moderate, indicating average performance in these areas. The high dividend per share suggests a commitment to returning value to shareholders, but the company needs to focus on improving its adjusted earnings per share to strengthen its overall financial health.

Profitability Ratio Summary

Profitability Score : 4.80

The company's profitability ratios show a mix of strengths and weaknesses. While the return on capital employed and return on assets are strong, the gross profit margin, return on equity, operating margin, and net margin are low. The high return on capital employed and assets suggests effective utilization of capital and assets to generate profits. The company needs to focus on improving its margins to enhance overall profitability and financial health.

Efficiency Ratio Summary

Efficiency Score : 4.67

The company's efficiency metrics present a mixed picture. While days sales in inventory and receivable days suggest effective working capital management, particularly in inventory and receivables, the turnover ratios for fixed assets, inventory, receivables, and capital indicate potential inefficiencies in asset utilization. This contrast suggests that while the company manages its inventory and receivables well and the other metrics need improvement, which might affect overall profitability and operational effectiveness.

Coverage Ratio Summary

Coverage Score : 5.60

The company's coverage ratios reflect a mixed performance. While the interest coverage ratio suggests an adequate ability to meet interest obligations, the very low equity dividend coverage ratio indicates that the company's earnings are not sufficient to cover dividend payments from equity. Although the ability to cover interest expenses is a positive indicator of financial health, the company may need to reassess its dividend policy to ensure long-term financial sustainability.

Solvency Ratio Summary

Solvency Score : 10.00

The company exhibits strong solvency, characterized by a high equity ratio and minimal debt, suggesting a solid financial foundation. This conservative capital structure provides stability and reduces financial risk. A high equity ratio indicates that the company relies more on equity than debt to finance its assets, which can be seen as a strength. This financial strength allows the company to pursue growth opportunities and manage economic downturns effectively.

Liquidity Ratio Summary

Liquidity Score : 2.00

The company's liquidity position is concerning, as indicated by uniformly low current, quick, cash, and operating cash flow ratios. This suggests potential difficulties in meeting short-term obligations. While a conservative approach to liquidity can minimize risk, the current levels may restrict operational flexibility and growth opportunities. These low ratios might reflect industry-specific practices or aggressive cash management strategies, but they warrant close monitoring to ensure the company can handle its immediate liabilities.