Shree Ram Proteins Limited reported a net loss of ₹2,107.50 lakh for the year ended March 31, 2025, as auditors issued an adverse opinion citing material uncertainty over the company's ability to continue as a going concern. The auditor, H. B. Kalaria & Associates, stated that the financial statements do not give a true and fair view in conformity with the recognition and measurement principles laid down in the Indian Accounting Standards (Ind AS). The company's Board of Directors approved the results on May 29, 2025.

Basis for Adverse Opinion

The adverse opinion stems from the company's default on the repayment of loans and statutory dues, including Corporate Social Responsibility (CSR) obligations. Despite these defaults, the company continued to prepare its financial statements on a going-concern basis, which is not in accordance with the provisions of Ind-AS 1. Additionally, the company disclosed ongoing Corporate Insolvency Resolution Process (CIRP) proceedings under the Insolvency and Bankruptcy Code, 2016, although a stay was granted and a settlement agreement was reached in July 2024.

Operational and Financial Gaps

Auditors highlighted significant lapses in the company's financial reporting and asset management. The management failed to carry out balance confirmations and reconciliations with debtors, creditors, and parties for advances. Furthermore, the company did not conduct physical inspections of inventories or property, plant, and equipment for the period under review. Consequently, the auditors were unable to review the position of inventories and fixed assets as at the balance sheet date or assess the impairment of assets, including property, plant, equipment, inventories, advances, cash, bank balances, and debtors.

Financial Performance

For the year ended March 31, 2025, the company reported a total income of ₹255.40 lakh, a significant decrease from ₹1,510.89 lakh in the previous year. Total expenses stood at ₹2,356.59 lakh, slightly lower than the ₹2,522.27 lakh recorded in the prior year. The loss for the period was attributed partly to an inventory write-off amounting to ₹400.52 lakh. The company's earnings per share (basic and diluted) for the year was a loss of ₹0.98, compared to a loss of ₹0.45 in the previous year.

Liquidity and Settlement Issues

The company's cash and cash equivalents decreased to ₹1.36 lakh as of March 31, 2025, from ₹9.70 lakh a year earlier. A one-time settlement (OTS) accepted with Union Bank of India in February 2025 saw the company pay ₹242.50 lakh as the first instalment. However, the company failed to pay the second instalment of ₹376.25 lakh and the final instalment of ₹1,856.25 lakh due in March 2025. The company had previously withdrawn its Rights Issue in August 2023 due to a lack of investor interest.

Financial Results for the Year Ended March 31, 2025