Below is a structured extraction and summary of the relevant and actionable financial information from the filing submitted by Kothari Industrial Corporation Limited (KICL) dated 14 August 2025 for the quarter ended 30 June 2025.

1. Auditor’s Note

  • The Limited Review Report by Ray & Ray Chartered Accountants contains multiple qualifications and concerns, summarized as follows:

    1. Pending Stamp Duty Assessment: Sale of land and plant & machinery to Coromandel International Ltd (Rs 4,895 lakhs and Rs 133 lakhs respectively) - assessment of market value for stamp duty is pending, final outcome unknown.

    2. Lack of Confirmation of Balances: Trade receivables, payables, vendor/customer advances not confirmed externally; impact on P&L unknown.

    3. Revenue Recognition Issue: Rs 302.74 lakhs of income lacks sufficient supporting agreements/work orders; revenue recognition cannot be substantiated.

    4. Expense Recognition Issue: Rs 285.57 lakhs of expenses lack sufficient supporting documents; expense recognition cannot be substantiated.

    5. GST Reconciliation Pending: Input tax credit Rs 485.91 lakhs and GST outward liability Rs 271.04 lakhs not reconciled with GST portal; recoverability/payment uncertain.

    6. TDS Liability Reconciliation Pending: Net TDS liability Rs 175.62 lakhs pending reconciliation; TDS defaults Rs 3.55 lakhs outstanding; impact on liabilities and penalties unknown.

    7. Litigation Risk: Land repossession proceedings in Nilgiris pending in Madras High Court; potential liability and loss uncertain.

  • Conclusion: The auditor’s review report is qualified due to the above issues and uncertainties. No audit opinion is expressed (only limited review).

2. Financial Performance

MetricQ1 FY26 (30-Jun-2025)Q1 FY25 (30-Jun-2024)Q4 FY25 (31-Mar-2025)FY25 (31-Mar-2025)FY24 (31-Mar-2024)
Revenue from Operations (Rs lakhs)3,919.661,344.402,642.028,663.591,363.52
Other Income (Rs lakhs)32.3018.4245.3996.646,317.50
Total Income (Rs lakhs)3,951.961,362.822,687.418,760.237,681.02
Total Expenses (Rs lakhs)4,143.801,335.363,989.2310,377.063,648.57
Profit/(Loss) Before Tax (Rs lakhs)(191.84)27.46(1,301.81)(1,616.83)4,032.45
Profit/(Loss) After Tax (Rs lakhs)(191.84)27.46(1,301.81)(1,616.83)3,169.32
Other Comprehensive Income (Rs lakhs)---4.07109.96
Total Comprehensive Income (Rs lakhs)(191.84)27.46(1,297.74)(1,612.76)3,279.28
Paid-up Equity Capital (Rs lakhs)4,686.66624.194,635.914,635.91624.19
Earnings Per Share (Rs)(0.20)0.22(1.40)(1.74)26.27

Notes:

  • The company shows a significant increase in revenue from operations in Q1 FY26 (Rs 3,919.66 lakhs) compared to Q1 FY25 (Rs 1,344.40 lakhs) and Q4 FY25 (Rs 2,642.02 lakhs).
  • Despite higher revenue, the company reported a loss before tax and after tax of Rs 191.84 lakhs in Q1 FY26, compared to a small profit in Q1 FY25.
  • FY25 shows a loss before tax of Rs 1,616.83 lakhs compared to a profit of Rs 4,032.45 lakhs in FY24.
  • Other income in FY24 was unusually high (Rs 6,317.50 lakhs), likely due to non-recurring items (possibly related to asset sales).
  • EPS has turned negative in FY25 and Q1 FY26 after being strongly positive in FY24.

3. Detailed Notes / Management Commentary

  • No explicit management commentary or explanatory notes are included in the filing.
  • Accounting policies: The results are prepared as per IND-AS 34 (Interim Financial Reporting).
  • No changes in accounting policies or material adjustments are mentioned.
  • The auditor’s note highlights pending reconciliations and confirmations which may impact the reliability of reported figures.
  • The company has pending litigation related to land repossession which may result in contingent liabilities.
  • No commentary on margins, NPAs, slippages, or AUM (not a financial services company).

4. Segment Information

  • No segment-wise or geographic breakdown of revenue or profit is provided in the filing.

5. Capex, Projects, and Corporate Activity

  • No explicit information on capital expenditure or ongoing/planned projects.
  • No mention of writedowns, writebacks, impairments, or provisions in the quarter.
  • No acquisitions, disposals, divestitures, or mergers reported in this filing.
  • However, the auditor’s note references a previous sale of land and plant & machinery to Coromandel International Ltd (Rs 4,895 lakhs and Rs 133 lakhs respectively).
  • No restructuring or cost-cutting measures disclosed.

6. Standalone vs Consolidated

  • The results and auditor’s report pertain to Standalone Financial Results only.
  • No consolidated financial results are provided in this filing.

Summary for Investment Analysis Team

AspectKey Points
Auditor’s OpinionLimited Review with multiple qualifications and concerns related to confirmations, revenue/expense substantiation, GST and TDS reconciliations, and pending litigation.
Financial PerformanceQ1 FY26 revenue up significantly vs prior periods, but company reported loss before and after tax. FY25 was a loss-making year after a profitable FY24.
EPSNegative in Q1 FY26 and FY25, sharply down from FY24.
Other IncomeFY24 had large other income (Rs 6,317.50 lakhs), likely non-recurring.
Accounting PoliciesPrepared under IND-AS 34, no changes reported.
Segment/GeographyNot disclosed.
Capex/Corporate ActivityNo new capex or projects disclosed; prior sale of land and machinery noted with pending stamp duty assessment.
Standalone Results OnlyNo consolidated results provided.
RisksPending litigation on land repossession; unresolved tax and GST reconciliations; unconfirmed balances; potential liabilities and penalties.

Recommendation:

  • The financial results show operational improvement in revenue but continued losses and significant audit qualifications raise concerns about the reliability of reported figures.
  • Pending litigations and unresolved statutory reconciliations pose contingent risks.
  • Further due diligence and clarification from management on audit qualifications and pending issues are advised before making investment decisions.

End of Analysis