Gayatri Highways Limited , a company engaged in the construction, investment, operations, and maintenance of roads and highways, has reported a standalone net loss of Rs 508.82 lakhs for the quarter ended September 30. This marks a significant downturn from the net profit of Rs 3,152.31 lakhs recorded in the same quarter last year.

Financial Performance

The company's financial results for Q2 paint a challenging picture:

The total income for the quarter decreased substantially to Rs 81.80 lakhs from Rs 3,556.73 lakhs in the corresponding quarter of the previous year, representing a decline of 97.7%.

Half-Year Performance

For the half-year period ended September 30, Gayatri Highways reported:

• Net profit: Rs 2,643.49 lakhs
• Previous year's half-year net profit: Rs 929.73 lakhs

This indicates a year-on-year improvement in the company's half-yearly performance, despite the weak quarterly results.

Consolidated Results

On a consolidated basis, the company reported:

• Q2 net loss: Rs 324.22 lakhs
• Half-year net loss: Rs 535.97 lakhs

Debt Concerns

Gayatri Highways disclosed a default on term loan repayments amounting to Rs 5,015.86 lakhs to IL&FS Financial Services Limited. This default raises concerns about the company's financial health and liquidity position.

Auditor's Observations

The company's auditors issued qualified reports, highlighting several areas of concern:

1. Write-back of Zero Interest Subordinate Loan (ZISL) of Rs 17,887.51 lakhs, pending confirmation from Gayatri Projects Limited.
2. Default on term loan repayment and interest to IL&FS Financial Services Limited.
3. Non-provision of interest on outstanding term loan for the current period.
4. Potential impairment issues related to investments and loans to jointly controlled entities.

These qualifications suggest that there may be additional financial challenges that are not fully reflected in the reported figures.

Outlook

The significant drop in revenue and the swing from profit to loss in Q2 indicate that Gayatri Highways is facing operational challenges. The default on loan repayments and the auditor's qualifications further underscore the financial stress the company is experiencing.

Investors and stakeholders may need to closely monitor the company's efforts to address these issues, including any potential debt restructuring or operational improvements in the coming quarters.

Gayatri Highways Limited (GHL) has announced a significant amendment to its Securities Purchase, Subscription and Shareholders' Agreement (SPSSA), introducing new provisions that could impact its stake in HKR Roadways Limited (HKRRL). The company's Board of Directors approved these changes on October 18, 2025, modifying an agreement originally executed on April 28, 2021.

Key Amendments

The primary amendment to the SPSSA introduces two crucial clauses:

1. Lender Approval Requirement: Any exercise of Call Rights or other rights that would result in the Investor (Kotak Special Situations Fund) holding less than 74% equity in HKRRL now requires prior written approval from HKRRL's lenders.

2. Restriction on Promoters' Rights: The amendment restricts Promoters from exercising certain rights if a default occurs under the Definitive Agreements.

Impact on Gayatri Highways Limited

These amendments could significantly affect GHL's options and flexibility regarding its stake in HKRRL:

• GHL currently holds a 26% stake in HKRRL.
• The company's ability to exercise its options in HKRRL is now contingent on HKRRL's compliance with its loan agreements.
• In the event of a default by HKRRL on its loan payments, GHL's rights under the SPSSA may be limited.

Parties Involved

The agreement involves three main parties:

1. Gayatri Highways Limited
2. Kotak Special Situations Fund (a Category II alternative investment fund)
3. HKR Roadways Limited

Regulatory Compliance

GHL has made this disclosure in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has emphasized that this transaction does not fall under related party transactions.

This amendment underscores the complex interplay between corporate agreements, stakeholder rights, and lender interests in infrastructure projects. Investors and stakeholders of Gayatri Highways Limited should closely monitor how these changes might affect the company's strategic options and financial flexibility moving forward.