Sharika FY26 net loss at ₹770.51 lakh on higher costs
Sharika Enterprises Limited reported a net loss of ₹770.51 lakh for FY26, compared to a net profit of ₹97.19 lakh in the previous year, with revenue declining to ₹7,515.99 lakh. The increase in finance costs and total expenses, coupled with a sharp rise in raw material costs, particularly copper, impacted profitability. The statutory auditors issued a qualified opinion due to the company's failure to assess the net realizable value of slow-moving inventories, compute Expected Credit Losses on trade receivables, and reconcile advances to suppliers. On a consolidated basis, the net loss widened to ₹890.15 lakh from ₹36.18 lakh in FY25.
*this image is generated using AI for illustrative purposes only.
Sharika Enterprises Limited has reported a net loss of ₹770.51 lakh for the financial year ended March 31, 2026, reversing the net profit of ₹97.19 lakh recorded in the previous fiscal year. Revenue from operations stood at ₹7,515.99 lakh, down from ₹7,950.16 lakh in FY25. The Board of Directors approved the results at a meeting held on May 20, 2026.
Standalone Financial Performance
The company’s total expenses for the year increased to ₹8,625.69 lakh from ₹7,891.04 lakh in the prior year. Finance costs rose to ₹274.72 lakh compared to ₹170.72 lakh in FY25. The basic and diluted earnings per share (EPS) for the year were reported at a loss of ₹1.78 per share, compared to an EPS of ₹0.22 in the previous year.
| Particulars | Year Ended 31-Mar-2026 (₹ in Lakhs) | Year Ended 31-Mar-2025 (₹ in Lakhs) |
|---|---|---|
| Revenue From Operations | 7,515.99 | 7,950.16 |
| Total Expenses | 8,625.69 | 7,891.04 |
| Net Profit / (Loss) for the period | (770.51) | 97.19 |
| Basic Earnings Per Share (Rs.) | (1.78) | 0.22 |
Qualified Audit Opinion
The statutory auditors issued a qualified opinion on the financial results. The qualification centers on the company’s failure to assess the net realizable value of slow/non-moving inventories amounting to ₹145.69 lakhs. Additionally, the auditors noted that trade receivables aggregating to ₹5,417.79 lakhs include old outstanding balances, and no provision for Expected Credit Losses (ECL) has been computed under Ind AS 109. Advances to suppliers totaling ₹244.62 lakhs also remain unreconciled with no provision for recoverability.
Consolidated Results
On a consolidated basis, the company reported a net loss of ₹890.15 lakh for FY26, widening from the loss of ₹36.18 lakh in the previous year. Total income decreased to ₹7,644.41 lakh from ₹8,212.59 lakh in FY25. The auditors similarly issued a qualified opinion for the consolidated results, citing the same issues regarding inventory, trade receivables, and advances at the holding company level.
Management Commentary
The management attributed the loss to an unprecedented increase in raw material costs, particularly copper, which severely impacted margins. The company also refused certain orders due to price volatility, which affected turnover. Regarding the audit qualifications, management stated that the slow-moving inventory consists of tailor-made products expected to be sold at commercially viable margins and that trade receivables are primarily from state utilities and are considered recoverable.
Historical Stock Returns for Sharika Enterprises
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +4.03% | +19.49% | +12.43% | +3.80% | -25.72% | -5.05% |
What strategies is management implementing to hedge against copper price volatility to prevent future margin erosion?
How does the company plan to address the audit qualifications regarding Expected Credit Losses on trade receivables from state utilities?
Is the company considering raising capital or restructuring debt to manage the increasing finance costs?
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