Anka India Reports Q1 Loss, Approves Subsidiary Merger
Anka India Limited reported a standalone net loss of ₹20.18 lakh in Q1, compared to a profit of ₹8.33 lakh in the previous year. Total revenue declined to ₹11.16 lakh from ₹14.21 lakh. On a consolidated basis, including its subsidiary Futech Internet Private Limited, the company posted a marginal net loss of ₹0.92 lakh with total revenue of ₹601.00 crore. The Board approved the amalgamation of Futech Internet with Anka India, aiming to consolidate operations and unlock shareholder value. Auditors raised concerns about idle inventories, intangible assets, and recognition of MAT assets.
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Anka India Limited , a listed public company, has reported its financial results for the first quarter. The company faced challenges during the quarter, reporting a standalone net loss while also announcing a significant corporate restructuring move.
Financial Performance
Anka India Limited reported a standalone net loss of ₹20.18 lakh for the quarter, a stark contrast to the profit of ₹8.33 lakh recorded in the same period last year. The company's total revenue declined to ₹11.16 lakh from ₹14.21 lakh year-on-year, indicating a challenging business environment.
On a consolidated basis, which includes the results of its wholly-owned subsidiary Futech Internet Private Limited, the company posted a marginal net loss of ₹0.92 lakh. The consolidated total revenue, however, stood at a much higher ₹601.00 crore, primarily driven by the subsidiary's operations.
Key Financial Highlights (Standalone):
| Particulars (in ₹ lakh) | Q1 Current | Q1 Previous | Change |
|---|---|---|---|
| Total Revenue | 11.16 | 14.21 | -21.5% |
| Net Profit/(Loss) | (20.18) | 8.33 | N/A |
Subsidiary Performance
Futech Internet Private Limited, the wholly-owned subsidiary of Anka India, demonstrated strong performance. For the quarter, Futech Internet reported:
- Revenue: ₹598.58 lakh
- Net Profit: ₹1.27 lakh
This subsidiary's performance significantly bolstered the consolidated results of Anka India Limited.
Corporate Restructuring
In a significant development, the Board of Directors of Anka India Limited approved in principle the amalgamation of Futech Internet Private Limited with Anka India Limited. This move is aimed at consolidating operations and unlocking value for shareholders.
The company stated that the proposed amalgamation is expected to:
- Achieve economies of scale
- Reduce costs by eliminating duplication of functions
- Strengthen the combined entity's market position
- Enhance growth prospects
- Improve financial and resource mobilization
- Leverage infrastructure, facilities, and human resources more effectively
Auditor's Observations
The company's auditors have raised some concerns in their review report:
- Idle inventories worth ₹22.50 lakh have been carried without assessment of net realizable value.
- Intangible assets under development amounting to ₹6.99 crore have been carried for over two years without progress assessment.
- The company continues to recognize minimum alternative tax (MAT) assets of ₹35.38 lakh, which the auditors view as not prudent given the company's history of losses.
Looking Ahead
While Anka India Limited faces challenges in its standalone operations, the strong performance of its subsidiary and the proposed merger could potentially create new opportunities for growth and value creation. Investors and stakeholders will be keenly watching how the company navigates these changes and addresses the auditors' concerns in the coming quarters.
The company's management has not provided specific forward-looking statements or guidance for the upcoming quarters. However, the corporate restructuring move suggests a strategic focus on streamlining operations and improving overall financial performance.
Historical Stock Returns for Anka India
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +1.99% | +10.34% | +89.76% | +214.61% | +204.28% | +625.59% |
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