Advik Capital Limited reported a consolidated net loss of ₹693.34 lakh for the quarter ended September 30, 2026 (Q2FY27), marking a sharp reversal from the net profit of ₹58.88 lakh recorded in the corresponding period last year.

The BSE-listed NBFC saw its top line contract significantly, with revenue from operations dropping to ₹189.51 lakh in Q2FY27, down 66.6% from ₹567.11 lakh in Q2FY26. The deterioration in profitability was primarily driven by a surge in finance costs and impairment provisions, which outweighed the decline in operating expenses.

Financial Performance Overview

The company’s total income for the quarter stood at ₹194.85 lakh, a steep fall from ₹573.71 lakh in the year-ago period. While other income remained marginal at ₹5.33 lakh, the cost structure expanded considerably. Finance costs rose to ₹663.21 lakh in Q2FY27, compared to ₹361.91 lakh in Q2FY26, reflecting increased borrowing costs or higher debt levels.

Additionally, the company recorded a provision for impairment on financial instruments of ₹119.27 lakh in the current quarter, against ₹101.64 lakh in the previous year. This combination of rising interest expenses and credit losses pushed the Profit Before Tax (PBT) into negative territory at ₹693.34 lakh, versus a positive PBT of ₹10.43 lakh in Q2FY26.

Balance Sheet and Cash Flow Signals

The balance sheet reflects an aggressive expansion in lending activities funded by debt. As of September 30, 2026, loans on the books grew to ₹34,861.92 lakh, up from ₹24,910.13 lakh as of March 31, 2026. Correspondingly, borrowings increased to ₹26,251.20 lakh from ₹14,387.63 lakh over the same period.

This leverage-driven growth strategy has strained liquidity. Cash and cash equivalents dwindled to ₹95.82 lakh as of September 30, 2026, a significant drop from ₹968.09 lakh at the start of the fiscal year. The statement of cash flows reveals that net cash used in operating activities was ₹11,519.86 lakh for the half-year ended September 30, 2026, largely due to the increase in loans issued.

What the Numbers Show

A critical divergence exists between the company’s reported asset quality and its cash position. While management continues to carry the ₹64 crore loan extended to Elitecon International Limited as a recoverable financial asset, the overall loan book has grown by nearly 40% since March 2026, financed almost entirely by new borrowings. With finance costs rising by 83% YoY and cash reserves falling below ₹100 lakh, the company faces significant near-term refinancing pressure if recovery timelines for disputed assets like Elitecon extend further.

Regulatory and Legal Disclosures

The Board meeting held on October 15, 2026, also addressed several regulatory matters. The auditors highlighted ongoing proceedings initiated by the Directorate of Enforcement (ED) under the Prevention of Money Laundering Act (PMLA) against a promoter and director. The company stated that no predicate offence is alleged against it, nor have any of its assets been attached.

Separately, the company disclosed legal disputes regarding the ₹64 crore financial assistance provided to Elitecon International Limited. The outstanding amount, including accrued and penal interest totaling ₹77.43 crore, remains under dispute. The respondents have contested the nature of the transaction, while Advik Capital maintains the claim is legally enforceable and recoverable.

Advik Capital Limited shareholders unanimously approved all seven resolutions at the 41st Annual General Meeting (AGM) held on September 30, 2026. The meeting focused on adopting FY26 financial statements and appointing MASAR & Co. as statutory auditors.

The company’s Board of Directors, led by Whole-Time Director and CEO Narendra Kumar Singhal, presented the company’s business strategy, growth plans, and financial performance to shareholders. Director and CFO Pankaj provided insights into future prospects and a SWOT analysis during the session.

Voting results and resolution details

The scrutinizer’s report, submitted by Shubhangi Agarwal & Associates on October 1, 2026, confirmed that all ordinary and special resolutions were passed with requisite majorities. The promoter group voted in favor of all items except those related to interested-party transactions, where their votes were excluded as per regulatory norms.

Auditor changes and governance updates

A significant update involved the change in statutory auditors. The company appointed M/s MASAR & Co., Chartered Accountants (FRN: 033829N), to fill the casual vacancy caused by the resignation of M/s KSMC & Associates. This appointment is valid until the conclusion of the ensuing AGM. Additionally, the remuneration for MASAR & Co. was fixed by the members.

The meeting also addressed related party transactions. Shareholders approved material related party transactions proposed for FY27 and ratified those entered into during FY26. For these specific resolutions, votes cast by interested parties, including the promoter group, were treated as invalid to ensure fair representation from public shareholders.

Meeting proceedings and attendance

The AGM commenced at 2:00 pm and concluded at 2:38 pm. The quorum was met, and voting was conducted electronically via remote e-voting and live e-voting during the meeting. The record date for determining eligible voters was September 23, 2026, with 1,31,481 shareholders on record.

Directors present included Narendra Kumar Singhal (Chairperson), Pankaj (Director cum CFO), Swati Gupta (Independent Director), and Sony Kumari (Independent Director). Chhavi Gupta served as Company Secretary and Compliance Officer.