Esha Media Research Limited has reported a significant downturn in its financial performance for the first quarter, as disclosed in its recent financial results.

Financial Performance

The media monitoring company posted a net loss of Rs 40.70 lakhs for the quarter, a stark contrast to the profit of Rs 34.81 lakhs recorded in the same quarter of the previous year. The company's revenue from operations saw a substantial decline, dropping to Rs 53.60 lakhs from Rs 114.61 lakhs year-over-year, marking a 53.2% decrease.

Financial Challenges

Esha Media Research is grappling with significant financial challenges, as evidenced by its fully eroded net worth and current liabilities exceeding current assets. The company's financial position is further complicated by an outstanding unsecured loan liability of Rs 769.68 lakhs from an ex-director, which remains unresolved. The management is currently in discussions for a potential waiver of this loan.

Audit Observations

The company's auditors, N. A. Shah Associates LLP, have issued a qualified conclusion in their limited review report, citing concerns over the outstanding loan liability. The auditors noted that the loan includes Rs 71.65 lakhs received after the cessation of directorship and Rs 98.50 lakhs taken under the erstwhile Companies Act, 1956.

Going Concern and Management Commitments

Despite the financial difficulties, the company's management has prepared the financial results on a going concern basis. The promoters have committed to infusing funds as required for working capital needs or any other shortfalls that may arise.

Capital Restructuring Plans

In a significant development post the quarter-end, Esha Media Research's board has approved a proposal to increase the company's authorized share capital from Rs 1,300.00 lakhs to Rs 3,500.00 lakhs. This move is aimed at facilitating a preferential issue of equity shares and convertible warrants at Rs 15 each. The proposal includes:

• Issuance of 10,00,000 equity shares
• Issuance of 2,39,00,000 convertible warrants

This capital restructuring plan is subject to shareholder approval at an Extraordinary General Meeting (EGM).

Financial Results Overview

The company's management and board are taking steps to address the financial challenges and improve its capital structure. Shareholders and investors will be keenly watching the outcome of the upcoming EGM and the implementation of the proposed capital restructuring plan.

Esha Media Research Limited is set to undergo a significant ownership transition as Opulus Bizserve Private Limited launches an open offer to acquire up to 26% stake in the company. This move follows a series of strategic transactions, including a share purchase agreement and a proposed preferential allotment of shares and warrants.

Open Offer Details

Opulus Bizserve has announced its intention to acquire up to 22,89,802 fully paid-up equity shares, representing 26% of the emerging voting share capital of Esha Media Research. The offer price has been set at ₹15.00 per share, valuing the total consideration at ₹3.43 crore.

Underlying Transactions

The open offer has been triggered by multiple transactions:

1. Share Purchase Agreement: Opulus Bizserve has entered into an agreement to acquire 1,50,000 equity shares (1.92% stake) from the promoter group at ₹14.00 per share.

2. Preferential Allotment of Equity Shares: Esha Media Research's board has approved the issuance of 10,00,000 equity shares to Opulus Bizserve at ₹15.00 per share.

3. Preferential Allotment of Convertible Warrants: The board has also approved the issuance of 2,39,00,000 convertible warrants to Opulus Bizserve and other non-promoter entities at ₹15.00 per warrant.

Implications for Shareholding

Upon completion of these transactions, the shareholding structure of Esha Media Research is expected to change significantly:

*Post-issue figures assume full conversion of warrants

Management Commentary

Shilpa Vinod Pawar, Whole-time Director of Esha Media Research, stated, "The board has approved these strategic initiatives to strengthen the company's capital base and bring in new investors. We believe these moves will position Esha Media Research for future growth and expansion."

Regulatory Compliance

The proposed transactions are subject to shareholder approval at an Extraordinary General Meeting scheduled for September 1, 2025. The company has assured compliance with SEBI regulations, including maintaining the minimum public shareholding requirements post-transaction.

Market Impact

Esha Media Research shares are currently listed on the BSE and are trading under Enhanced Surveillance Measure (ESM) Stage 2. The open offer and subsequent changes in shareholding structure could potentially impact the stock's trading dynamics.

Investors and market participants will be closely watching these developments as Esha Media Research undergoes this significant ownership transition. The success of the open offer and the completion of the preferential allotments could mark a new chapter for the company in the media research sector.