Kandagiri Spinning Mills Limited has appointed KUVS & Associates as its Secretarial Auditors for the financial year 2025-26. The Board of Directors approved the appointment on May 30, 2026. The firm will oversee secretarial audit and compliance certification services for the company.

The appointment was made by the Board as the company falls under the exempted category stated under Regulation 15(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Consequently, Regulation 24A of the SEBI (LODR) Regulations, 2015 is not applicable to the company.

KUVS & Associates, Company Secretaries, holds a Unique Code Number P2024TN102800 and a Peer Review Certificate No: 6318/2024. The firm offers services including secretarial audit, company law advisory, and SEBI regulations advisory.

The table below outlines the key details of the appointment:

There is no relationship between the directors of Kandagiri Spinning Mills Limited and the newly appointed auditors that requires disclosure.

Kandagiri Spinning Mills Limited reported a net loss of ₹325.29 lakh for the financial year ended March 31, 2026, as total income declined to ₹38.94 lakh from ₹203.10 lakh in the previous year. The company’s net worth has been completely eroded, and its current liabilities exceed its current assets, raising significant doubts about its ability to continue as a going concern. Despite these financial challenges, the Board of Directors has decided to continue the yarn trading business, relying on promoter assurances for further fund infusion.

Financial Performance

The standalone financial results for FY26 reveal a sharp deterioration in financial health. For the year ended March 31, 2026, the company recorded a total income of ₹38.94 lakh, a significant drop compared to the prior year. Total expenses for the period stood at ₹220.53 lakh. The loss for the period was ₹325.29 lakh, widening from the loss of ₹79.28 lakh reported in the previous year.

Auditor's Qualified Opinion

SSAL & Associates, the statutory auditor, issued a qualified opinion on the standalone annual financial results. The auditors highlighted that the net worth erosion, coupled with the net loss of ₹325.29 lakh and the fact that current liabilities exceed current assets, indicates material uncertainty regarding the company's ability to continue as a going concern. The attached financial statements do not include any adjustments that might arise from these uncertainties.

Management Response and Going Concern

In response to the audit qualification, the management stated that no further adjustments are required to the carrying values of the financial statements even if the going concern concept is not adopted. The Board of Directors has deemed it fit to continue adopting the going concern basis of accounting. This decision is based on the company’s continued yarn trading operations and the promoters' ongoing infusion of funds, with assurances provided for additional capital support as deemed necessary.

Balance Sheet and Cash Flows

The balance sheet as of March 31, 2026, shows total assets of ₹1,088.39 lakh, a decrease from ₹1,345.78 lakh in the previous year. Non-current assets stood at ₹1,025.25 lakh, while current assets were ₹63.13 lakh. On the liabilities side, equity was negative at ₹(1,050.67) lakh, with non-current liabilities of ₹1,864.00 lakh and current liabilities of ₹275.07 lakh. The cash flow statement indicates a net increase in cash and cash equivalents of ₹50.24 lakh during the year, primarily driven by proceeds from the sale of property, plant, and equipment amounting to ₹228.80 lakh.