Vama Industries Limited has received a favorable order from the Deputy Commissioner of Income Tax, Circle-8(1) Hyderabad, resulting in a significant reduction of its contingent liability. The order, which pertains to the Financial Year 2016-17 (Assessment Year 2017-18), has led to the deletion of an addition of Rs. 86.38 lacs in the company's total income.

Key Details of the Order

Implications of the Order

The favorable ruling confirms an earlier order passed by the Income Tax Appellate Tribunal (ITAT) 'F' Bench, Mumbai, effectively settling the disputed issue. This development is expected to have a positive impact on Vama Industries' financial position by reducing its contingent liabilities.

Regulatory Compliance

In compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Vama Industries promptly disclosed this material development to the BSE Limited. The company's Managing Director, V. Atchyuta Rama Raju, signed the regulatory filing, demonstrating the company's commitment to transparency and adherence to listing regulations.

This favorable tax ruling underscores the importance of effective tax management and the potential financial benefits that can arise from successfully resolving tax disputes. For investors and stakeholders of Vama Industries, this development may be seen as a positive indicator of the company's financial management and its ability to navigate complex regulatory challenges.

Vama Industries Limited has announced its unaudited financial results for the first quarter ending June 30. The company reported mixed results, with a stark contrast between its standalone and consolidated performance.

Standalone Performance

On a standalone basis, Vama Industries showed resilience:

• Revenue from operations stood at ₹367.71 crore, marking a significant increase from ₹120.54 crore in the same quarter last year.
• Net profit for the quarter was ₹6.90 crore, compared to ₹37.72 crore in the corresponding quarter of the previous fiscal year.
• Basic earnings per share (EPS) for the quarter was ₹0.01.

Consolidated Results

The consolidated financial results, however, painted a different picture:

• The company reported a consolidated net loss of ₹207.04 crore for the quarter.
• This loss was primarily attributed to the performance of its foreign subsidiary, Varna Technologies Pte Ltd, which reported a net loss of ₹233.42 crore with nil revenues.

Key Financial Highlights

Management Commentary

The company's management, led by Managing Director V. Atchyuta Rama Raju, conducted a board meeting on August 14 to review and approve the financial results. The meeting, which commenced at 4:00 PM and concluded at 5:10 PM, also saw the approval of both standalone and consolidated financial results as recommended by the Audit Committee and reviewed by the Statutory Auditors.

Segment Reporting

Vama Industries Limited reported that its entire operations relate to only one segment, and therefore, segmental reporting as per Ind AS 108 was not applicable.

Auditor's Review

P. Suryanarayana & Co., Chartered Accountants, conducted a limited review of the financial results. They stated that nothing has come to their attention that causes them to believe that the financial statements have not been prepared in accordance with applicable accounting standards and SEBI regulations.

The financial results for the quarter reflect a complex picture for Vama Industries Limited, with strong standalone growth in revenue year-over-year, but challenges at the consolidated level, primarily due to losses in its foreign subsidiary.