When i use my Ultimate Sword or Ultimate Bow from Orespawn mod or the sword from "The Last Sword You Will Ever Need" it doesn't do as much damage (according to Damage Indicators mod) as it should do, same goes to the Last Sword You Will Ever Need. i do have quite a lot of mods running. I don't know if they are conflicting with each other. The Ultimate Sword should deal 46.25 damage but the damage indicator and other mobs health show that it only does 25 damage.
What mobs are you actually using it against? There are many mobs which have default armor (they take less damage passively). It could also be that the mob you are attacking only has 25 health. As far as I know, Damage Indicators only shows the amount of damage you do to the mob, not the overall damage. If the mob only has 25 health, you will only deal 25 damage to it.
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I had the same problem as you and I have found out the cause of this. I removed Advent of ascension from the list and now weapns can deal damage more than 25 dmg. Though, I find it hard to let go of such a good mod like AOA, maybe you can try to downgrade the mod version, that might help.
I have been encountering this sort of problem as well. And I have to say that it's actually not that difficult to resolve.
In fact, all you have to do to remove the 25 damage cap is to go into your modpack folder, find the config folder, locate the "AoA.cfg" file, open it, find the line saying "I:DamageLimit=1" and change that 1 to Zero.
There, done. No need to remove AoA from the modpack.