Surat Trade & Mercantile reported a 51% year-on-year increase in profit before tax (PBT) to ₹1,399.35 lakh for the financial year ended March 31, 2026 (FY26). The company’s revenue from operations grew by 62% to ₹11,134.58 lakh, driven by higher volumes in commodity trading and gains from the sale of artworks.

Financial Performance

Revenue from operations rose significantly from ₹6,863.70 lakh in FY25 to ₹11,134.58 lakh in FY26. The company attributed this growth to increased business volumes in metals, particularly gold and silver, amid global market volatility. While total income reached ₹12,513.14 lakh, other income declined slightly to ₹1,378.56 lakh from ₹1,482.44 lakh in the previous year due to lower returns in listed financial markets.

Profit before depreciation and amortization stood at ₹1,456.58 lakh, up from ₹980.24 lakh in FY25. Finance costs remained minimal at ₹15.18 lakh, reflecting the company’s debt-free status. Depreciation and amortization expenses increased marginally to ₹57.23 lakh from ₹51.65 lakh.

What the Numbers Show

A notable divergence exists between the company’s pre-tax and post-tax performance. While PBT surged by 51%, net profit after tax fell by 6% to ₹1,097.60 lakh. This contraction was primarily driven by a sharp reversal in tax expenses; the company recorded a tax expense of ₹301.75 lakh in FY26 compared to a tax benefit of ₹237.42 lakh in FY25. This shift indicates that the bottom-line growth did not fully translate into retained earnings due to higher current tax outflows and reduced deferred tax benefits.

Operational Highlights

The company’s core commodity trading segment generated income of ₹10,625.33 lakh, up from ₹6,863.70 lakh in FY25. Management leveraged hedging strategies using derivatives on recognized exchanges to mitigate risks associated with price volatility, particularly during geopolitical tensions in the Middle East. Additionally, the sale of artworks contributed to the profit boost, with related party transactions for art sales amounting to ₹811.25 lakh.

Investment activities saw mixed results. Income from Alternative Investment Funds (AIFs) increased to ₹924.40 lakh from ₹805.51 lakh, with the total asset value under AIFs rising to ₹9,542.07 lakh. However, non-AIF investment income declined to ₹454.16 lakh from ₹676.93 lakh.

Corporate Governance and Compliance

The Board of Directors decided not to recommend any dividend for FY26, opting to retain profits for future growth. The company also disclosed an inadvertent non-compliance regarding related party transactions with Managing Director Mr. Alok P. Shah, which exceeded prescribed limits under SEBI Listing Regulations. The transactions were subsequently ratified by the Audit Committee, Board, and shareholders at an Extra-Ordinary General Meeting held on August 10, 2026. A suo motu settlement application was filed with SEBI.

Balance Sheet Strength

Surat Trade & Mercantile remains debt-free with no outstanding term loans or working capital facilities availed during the year. Total assets increased to ₹23,259.22 lakh from ₹22,059.66 lakh in FY25. Cash and cash equivalents rose sharply to ₹896.78 lakh from ₹100.73 lakh, indicating strong liquidity position. The company also reclassified certain land as investment property and recognized an impairment loss of ₹30.54 lakh on associated buildings.

The Board of Directors of surat trade & mercantile has approved the re-appointment of Deepak N. Shah as an Independent Director for a second term of five years. This governance move ensures continuity in the company’s independent oversight structure, with the new term commencing on August 11, 2027. The re-appointment is subject to ratification by shareholders through a Special Resolution at the ensuing 80th Annual General Meeting.

The decision was formalized during a Board meeting held on August 12, 2026, which commenced at 12:30 PM (IST) and concluded at 02:10 PM (IST). The disclosure was made pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Additionally, the filing complies with Para A Part A of Schedule III of the SEBI LODR Regulations, read with SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026.

Director Profile and Compliance

Deepak N. Shah, aged 76, brings over four decades of experience in statutory audits, tax audits, internal audits, management audits, and MIS-related services. He is a Fellow Member of the Institute of Chartered Accountants of India and serves as a Practicing Chartered Accountant. His extensive background supports the Board’s requirement for financial expertise among its independent directors.

Regulatory Affirmations

The filing confirms that Deepak N. Shah is not disqualified from holding the office of Director under Section 164 of the Companies Act, 2013. Furthermore, he is not debarred from holding the office of director by virtue of any SEBI order or other regulatory authority, as required under BSE Circular LIST/COMP/14/2018-19 dated June 20, 2018. The disclosure also states there are no inter-se relationships between Mr. Shah and any other director of the company, ensuring his independence.