Aban Offshore Limited has disclosed outstanding Non-Convertible Redeemable Preference shares worth ₹281 crore that remain unredeemed and under suspension since 2014.

The disclosure, made pursuant to Regulation 57 of SEBI (LODR) Regulations, 2015, notes that of the total amount, ₹20 crore pertains to unlisted preference shares. The company is currently undergoing the Corporate Insolvency Resolution Process (CIRP).

Set-off with Axis Bank dues

The filing highlights a specific financial adjustment involving Axis Bank Limited, an investee of the company's preference shares. In a prior year, Axis Bank utilised Aban Offshore's current account balance without consent to settle preference dues amounting to ₹18 crore.

The company stated that the legal framework of the preference share issue allowed this utilisation to be reflected as a recoverable amount in its books. Consequently, Aban Offshore set off the liability and the recoverable amount as on March 31, 2026.

Disclosure details

The document was signed by Shailesh Desai, Resolution Professional for Aban Offshore Limited, confirming the status of these long-standing liabilities amidst the ongoing insolvency proceedings.

Aban Offshore Limited reported its standalone and consolidated financial results for the quarter ended June 30, 2026, while undergoing Corporate Insolvency Resolution Process (CIRP). The statutory auditors, Ford Rhodes Parks & Co. LLP, issued a disclaimer of conclusion on both standalone and consolidated statements, citing material uncertainties related to the company's ability to continue as a going concern.

The company is currently managed by a Resolution Professional following an NCLT order dated September 1, 2025. The auditors highlighted that the company has accumulated losses, eroded net worth, and defaulted on term loan repayments. These conditions, combined with the ongoing insolvency proceedings, indicate significant doubt about the entity's continuity.

Standalone Financial Performance

On a standalone basis, Aban Offshore reported total income of ₹384.78 million for Q1FY27, up from ₹281.73 million in the corresponding quarter last year. Net profit after tax stood at ₹330.25 million, a substantial increase from ₹40.19 million in Q1FY26. However, this profitability is heavily influenced by the non-recognition of finance costs and preference dividends, which the Resolution Professional determined crystallized on the CIRP commencement date.

Consolidated Results and Foreign Subsidiary Issues

Consolidated total income rose to ₹1,782.63 million in Q1FY27 from ₹1,162.35 million in Q1FY26. The group posted a net profit of ₹837.20 million, reversing a loss of ₹2,528.12 million in the previous year. Despite the reported profit, the consolidated net worth remains deeply negative at ₹282,407.24 million as of March 31, 2026.

The auditor's disclaimer on consolidated results was further driven by issues at the foreign subsidiary, Aban Holdings Pte. Ltd. The component auditor also issued a disclaimer, noting that the foreign subgroup incurred a net loss of $24.33 million in the quarter and faces net liabilities of $3.01 billion. The subsidiary has defaulted on borrowings and received recall notices from lenders.

What the Numbers Show

A critical divergence exists between the reported standalone profit and the underlying financial health. The standalone net profit of ₹330.25 million is primarily driven by the absence of finance costs, which were recorded at zero compared to ₹161.74 million in Q1FY26. This accounting treatment, based on the crystallization of liabilities under IBC provisions, masks the true cost of capital and debt burden. Furthermore, the consolidated other comprehensive income shows a massive negative swing of ₹4,504.72 million, indicating severe foreign exchange losses or valuation adjustments not reflected in the primary profit line.

Key Disclosures and Risks

• Going Concern Uncertainty: The auditors stated that the appropriateness of the going-concern basis depends on improved cash flows, asset monetization, and the outcome of the CIRP.
• Overdue Investments: The company holds ₹94.34 million in overdue preference shares. Auditors could not obtain sufficient evidence to assess recoverability or determine if impairment is required.
• Unverified Bank Balances: For the foreign subsidiary, auditors could not confirm bank borrowings amounting to $1.76 billion due to incomplete bank confirmations.
• Preference Shares: Non-convertible cumulative redeemable preference shares worth ₹2,630 million remain unredeemed with no dividend paid.