Shareholders of National Oxygen approved the disposal of specific plant and machinery assets during its 51st Annual General Meeting on August 28, 2026. The board also confirmed that dividend and bonus share issues remain deferred given the company’s current financial position and reported losses.

The meeting, conducted via video conference, saw the attendance of 53 members. Rajesh Kumar Saraf, Managing Director, chaired the proceedings. All ordinary and special resolutions were passed with the requisite majority.

Key Resolutions Passed

The agenda included routine statutory matters alongside significant strategic asset disposals. Shareholders approved the following special resolutions:

• Adoption of new Memorandum of Association (MOA) as per the Companies Act, 2013.
• Adoption of new Articles of Association (AOA) as per the Companies Act, 2013.
• Approval for the sale or transfer of certain assets as a whole in the SIPCOT Perundurai unit.
• Approval for the sale or transfer of plant and machinery (liquid unit) in the Pondicherry unit.

Additionally, the board appointed Rajesh Kumar Saraf as a director upon his retirement by rotation.

Management Commentary

During the meeting, management addressed shareholder queries regarding the proposed asset sales. The chairman stated that the sale process is ongoing and that details, including consideration amounts, will be disclosed to stock exchanges once finalized in compliance with regulations.

Regarding capital allocation, the chairman explained that decisions on bonus issues and dividends would be reconsidered at an appropriate future time, citing the company’s current losses. He also acknowledged a typographical error in the Statement of Changes in Equity within the annual report, clarifying that it had no impact on financial figures or equity balances.

What the Numbers Show

The deferral of dividend and bonus payouts directly correlates with the company’s reported losses for the period. This indicates a prioritization of capital preservation and liquidity management over shareholder returns during the current fiscal cycle.

National Oxygen Limited reported a net loss of ₹200.64 lakh for the quarter ended June 30, 2026 (Q1FY26), widening from a loss of ₹187.03 lakh in the same period of FY25. The deterioration in profitability was primarily driven by a sharp decline in revenue and structural changes in operations, specifically the shutdown of its liquid plant in Pondicherry. This operational shift has significantly impacted the company’s cost structure and top-line growth prospects for the fiscal year.

The Board of Directors approved the unaudited standalone financial results on August 12, 2026, pursuant to Regulation 30 and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were reviewed by the Audit Committee and accompanied by a limited review report issued by the statutory auditors, PSDY & Associates. The financial statements were prepared in accordance with Indian Accounting Standard 34 (Ind AS 34) "Interim Financial Reporting".

Revenue from operations contracted sharply to ₹304.50 lakh in Q1FY26, down from ₹758.45 lakh in Q1FY25, representing a year-on-year decline of approximately 59.85%. Total income stood at ₹328.81 lakh, compared to ₹763.90 lakh in the corresponding previous period. Other income also saw a modest increase to ₹24.31 lakh from ₹5.45 lakh a year ago.

Total expenses amounted to ₹529.45 lakh, down from ₹950.92 lakh in Q1FY25. However, the reduction in expenses did not offset the drop in revenue, leading to a pre-tax loss of ₹200.64 lakh. Key expense components included employee benefit expenses of ₹56.73 lakh, financial costs of ₹46.03 lakh, and depreciation & amortisation of ₹54.56 lakh. Power and fuel costs remained significant at ₹91.37 lakh, while other expenditure stood at ₹150.74 lakh.

Operational Impact

The financial performance was heavily influenced by strategic operational decisions. Note 5 of the financial results states that the company stopped liquid plant operations at its Pondicherry unit effective April 6, 2026. This decision was taken due to severe competition and a steep hike in various operating expenses, including power costs, maintenance, and transportation. Consequently, the company now operates only one reportable primary business segment: Industrial Gases.

What the Numbers Show

The divergence between the revenue decline (-59.85%) and the expense reduction (-44.32%) highlights the fixed-cost burden remaining after the Pondicherry plant shutdown. While variable costs associated with the liquid plant have ceased, significant overheads such as employee benefits, financial costs, and depreciation persist. The widening net loss indicates that the cost savings from the shutdown have not yet fully materialized into improved margins, or that the revenue lost from the unit outweighs the saved operational costs in the short term. Investors should monitor whether the streamlined operations lead to margin stabilization in subsequent quarters.