Galaxy Agrico Exports Limited , a company listed on the BSE, has reported its unaudited financial results for the quarter and half-year ended September 30, 2025, revealing a significant downturn in performance and raising concerns about its asset management practices.

Financial Performance

The company's financial results paint a challenging picture:

Galaxy Agrico Exports reported a net loss of ₹22.30 lakhs for the quarter ended September 30, 2025, compared to a profit of ₹9.47 lakhs in the corresponding quarter of the previous year. For the half-year, the company's losses deepened to ₹32.79 lakhs, in contrast to a profit of ₹14.21 lakhs in the same period last year.

The company's revenue from operations also saw a slight decline, dropping from ₹100.12 lakhs in Q2 FY2025 to ₹98.11 lakhs in Q2 FY2026.

Auditor's Concerns

In their limited review report, the company's auditors, H.B. Kalaria & Associates, highlighted significant concerns:

1. Fixed Asset Management: The company has not conducted an inspection of its fixed assets and has not maintained a register of fixed assets during the period under review.

2. Inventory Management: The company has not carried out an inspection of its inventories during the review period.

The auditors stated that due to these issues, they were unable to obtain sufficient evidence regarding the existence of fixed assets and inventories. Consequently, they could not provide a basis for a review opinion on these aspects of the financial statements.

Management Response

The financial results were approved by the Board of Directors in their meeting held on November 11, 2025. However, the company's management has not provided any specific comments addressing the auditors' concerns in the available information.

Investor Implications

These results and the auditors' concerns raise several red flags for investors:

1. The shift from profit to loss indicates a significant deterioration in the company's financial performance.
2. The lack of proper fixed asset and inventory management practices could potentially lead to misstatement of the company's assets and overall financial position.
3. The inability of auditors to verify key assets may impact the reliability of the financial statements.

Investors and stakeholders may want to closely monitor the company's response to these issues and any steps taken to address the auditors' concerns in the coming quarters.

Galaxy Agrico Exports has taken a significant step towards restructuring its business operations. The company's Board of Directors has approved a draft slump sale agreement to divest its manufacturing and trading business of agricultural equipment and bearings to Forgex Rings Private Limited.

Key Details of the Transaction

Board Resolution for Property Purchase

In the latest development, the Board of Directors in their meeting held on December 15, 2025, passed a resolution authorizing the company to proceed with property purchase for business expansion using proceeds from the slump sale. The Board has taken note that upon successful completion of the slump sale, the company will receive consideration amount of ₹9.25 crore.

Authorization and Compliance

The Board has authorized Mr. Abhay Vasantrao Galgate (DIN 09596308), Director of the company, to negotiate, finalize, sign, execute and deliver all documents relating to the slump sale transaction, receipt of consideration, and property purchase. The authorization extends to execution of sale deed, MOU, registration documents and related property papers.

Additionally, Mr. Manoj H Shah, Whole-time Director (DIN 02173383), has been authorized to certify copies of the resolution and submit the same to any authority.

Background and Rationale

Galaxy Agrico Exports' decision to sell its current business stems from profitability concerns. The company stated that its present business is not very profitable, and continuing with the same line of business is not considered viable for the company's prospects. The sale proceeds are intended to be utilized for developing new business lines, potentially opening up more profitable avenues for the company.

Buyer Information

Forgex Rings Private Limited, the buyer, is a non-related entity to Galaxy Agrico Exports. It was incorporated in 2024 and has its registered office in Rajkot, Gujarat. The company's corporate identity number is U28219GJ2024PTC152330.

Regulatory Compliance

The Board has resolved that upon completion of the slump sale transaction and receipt of funds, the company shall inform BSE Limited and make necessary disclosures under applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and any other applicable regulation. The sale was previously approved by shareholders at the Annual General Meeting held on September 29, 2025.