Facor Alloys Limited , a prominent player in the alloy manufacturing sector, has reported a net loss of ₹67.04 crores for the quarter ended September 30, 2025. This financial update comes amidst ongoing challenges for the company, including the temporary shutdown of its plant operations.

Financial Performance

The company's Q2 FY26 results paint a picture of financial strain, albeit showing some improvement from the previous year:

The significant reduction in net loss compared to the same period last year suggests some level of cost management or extraordinary items affecting the bottom line. However, the company's operations remain severely impacted, as evidenced by the zero revenue from operations.

Operational Challenges

Facor Alloys has been grappling with operational issues since October 31, 2023, when its plant operations were temporarily shut down. This shutdown has resulted in nil revenue from operations for the current quarter, highlighting the severe impact on the company's core business activities.

Management Changes and Strategic Initiatives

In a bid to navigate through these challenging times, Facor Alloys underwent a management reshuffle in April 2024. The new management team, which took charge on April 5, 2024, is actively exploring various options to resume operations. These efforts include:

1. Engaging in dialogues with corporate houses
2. Seeking assistance from lenders
3. Infusion of funds by the promoter entity to meet ongoing expenses

Asset Sale and Shareholder Approval

In a significant move, Facor Alloys obtained shareholder approval through a postal ballot on July 10, 2025, for the sale of plant and machinery. This strategic decision has already yielded some results:

• The company received an advance of ₹13.31 crores from a potential purchaser.
• This advance, received in FY 2025-26, has not been recognized in the Statement of Profit and Loss for the current period, as it represents a preliminary transaction pending completion of the sale.

Audit Observations

The company's auditors, K.K. Mankeshwar & Co., have conducted a limited review of the standalone financial results. They have expressed an unmodified audit conclusion, indicating that the financial statements fairly represent the company's financial position in accordance with the applicable accounting standards.

Looking Ahead

As Facor Alloys continues to navigate through this challenging period, the focus remains on resuming plant operations and improving financial health. The company's ability to successfully implement its strategic initiatives, including potential asset sales and securing new partnerships or funding, will be crucial in determining its path to recovery.

Investors and stakeholders will be keenly watching the company's progress in the coming quarters, particularly any developments regarding the resumption of plant operations and the outcome of ongoing discussions with potential corporate partners and lenders.

Facor Alloys Limited , a prominent player in the alloy manufacturing sector, has taken significant steps to address its financial challenges and restructure its operations. The company recently executed an Asset Transfer Agreement with Rawmat Mining and Minerals, marking a pivotal moment in its strategic financial management.

Asset Sale Agreement

Facor Alloys has entered into an Asset Transfer Agreement with Rawmat Mining and Minerals for the sale of assets located at its Shreeramnagar facility in Vizianagaram District, Andhra Pradesh. The agreement, executed on August 2, 2025, will see Facor Alloys receive ₹47.15 crore from the transaction. This move is primarily aimed at meeting pressing and unavoidable financial liabilities faced by the company.

Key Details of the Transaction

• Buyer: Rawmat Mining and Minerals, a partnership firm specializing in mine site development and metallic mineral processing operations.
• Assets Involved: The sale encompasses assets situated at Facor Alloys' premises in Shreeramnagar, Vizianagaram District, Andhra Pradesh.
• Transaction Value: ₹47.15 crore
• Expected Completion: Within one year from the contract award date
• Shareholder Approval: Obtained through postal ballot under Section 180 of the Companies Act, 2013

It's worth noting that the manufacturing facilities at the Shreeramnagar plant have been non-operational since October 31, 2023, which factored into the company's decision to divest these assets.

Regulatory Compliance and Transparency

The company has ensured full compliance with regulatory requirements, including:

• Intimation under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
• Shareholder approval obtained on July 9, 2025
• Confirmation that the transaction does not constitute a related party transaction

Recent Arbitration Award

In a separate development, Facor Alloys received a favorable arbitration award on July 31, 2025, in a dispute with Rajadhiraj Tirupani Vinayak Natraj Pvt. Ltd. The award includes:

• ₹18.87 crore towards conversion charges
• ₹37.77 lakh towards invoices
• Outstanding electricity charges
• 9% per annum interest on the above amounts from the due date (around October 2022)

The arbitration also required Facor Alloys to return certain raw materials and finished products to Rajadhiraj Tirupani Vinayak Natraj Pvt. Ltd. and awarded ₹2.17 crore to be adjusted against the due amount.

Conclusion

These recent developments highlight Facor Alloys' proactive approach to addressing its financial challenges. The asset sale agreement and the favorable arbitration outcome are expected to significantly improve the company's financial position, potentially paving the way for a stronger operational focus in the future.