Mayur Leather Products Limited reported a net profit of ₹127.37 lakhs for the financial year ended March 31, 2026, entirely attributable to other income as the company generated no revenue from operations. The statutory auditors, M/s Jain Paras Bilala & Co., issued an adverse opinion on the standalone and consolidated financial results, citing material uncertainties related to the company's ability to continue as a going concern and the absence of verified bank records for several accounts.

The board approved the audited standalone and consolidated financial results for the quarter and year ended March 31, 2026, at a meeting held on May 28, 2026. The financial statements disclose that the company has not carried out any manufacturing activities during the current or previous financial year. Accumulated losses stood at ₹616.41 lakhs as of March 31, 2026. Despite these conditions, management asserts that the going concern basis of accounting is appropriate, citing future business projections, vendor settlements, and promoter fund infusion as mitigating factors.

Audit Qualifications and Financial Irregularities

The auditors highlighted several material issues, including the continued recognition of land and building amounting to ₹155.16 lakhs that were auctioned by Canara Bank following a loan default. The company has challenged the auction before the Debt Recovery Tribunal (DRT), but no legal opinion was provided to support the continued asset recognition. Additionally, the company disposed of substantially all fixed assets for ₹166.73 lakhs without providing no-dues certificates or charge satisfaction documents for verification.

Other significant qualifications include the non-transfer of unclaimed dividends to the Investor Education and Protection Fund (IEPF) for dividends pertaining to FY 2013-14, 2014-15, and 2015-16. The auditors also noted the absence of actuarial valuation for gratuity and leave encashment liabilities, non-compliance with Ind AS 19, and a lack of physical verification for inventory balances valued at ₹67.35 lakhs.

Key Financial Metrics

The following table summarizes the financial performance for the year ended March 31, 2026:

The trading window for designated persons and their immediate relatives remains closed until 48 hours after the declaration of the financial results. The intimation regarding the board meeting outcome is available on the company's official website.

Mayur Leather Products Limited has re-submitted its Limited Review Report for consolidated financial results for the quarter ended December 2025 following a regulatory compliance query from the stock exchange.

Regulatory Compliance Issue

The company received a query from BSE stating that the Limited Review Report for consolidated results was not in the prescribed SEBI format. Specifically, the report lacked Point No. 4 as required under Securities and Exchange Board of India Circular No. CIR/CFD/CMD1/44/2019 dated March 29, 2019.

The company clarified that except for the inclusion of Point No. 4 in the Limited Review Report, no other changes have been made in the previously submitted disclosure or the financial results.

Auditor's Adverse Remarks

The independent auditor's limited review report contains significant adverse observations across multiple areas. The auditor stated that the financial statements have not been prepared in accordance with Indian Accounting Standards due to material and pervasive issues.

Key Audit Concerns

Bank Account Documentation: The company failed to provide bank statements for several accounts, including:

Going Concern Issues: The auditor highlighted material uncertainties about the company's ability to continue as a going concern, noting:

• Operating losses in recent years
• No revenue from operations in current quarter and last financial year
• Plant, property and equipment relocated after land detachment by Canara Bank
• Non-filing of Income Tax Returns for FY 2022-23 and 2023-24

Financial Position Highlights

The company's financial statements show significant challenges across multiple parameters:

Land Sale Dispute

A significant matter involves the sale of land belonging to subsidiary Mayur Global Private Limited by Canara Bank in August 2024 for Rs. 226.00 lakhs due to the holding company's loan default. The company has transferred Rs. 213.60 lakhs to the subsidiary as provisional adjustment and challenged the sale before the Debt Recovery Tribunal (DRT).

Compliance and Accounting Issues

The auditor identified multiple non-compliance areas:

• Non-transfer of unpaid dividends to Investor Education and Protection Fund
• Lack of impairment assessment for PPE worth Rs. 115.96 lakhs
• Non-compliance with employee benefit valuation requirements
• Absence of Expected Credit Loss policy
• Missing physical verification of inventory worth Rs. 67.35 lakhs

Management Response

The company requested stakeholders to disregard the earlier disclosure dated February 14, 2026, and consider the revised disclosure incorporating the required SEBI format compliance. Management maintains that necessary accounting adjustments arising from the DRT proceedings will be recognized when the matter reaches finality.