Gujarat State Financial Corporation Reports ₹3,102.13 Lakh Net Loss in Q1
Gujarat State Financial Corporation (GSFC) announced Q1 results with a net loss of ₹3,102.13 lakh, slightly better than the ₹3,121.71 lakh loss in the same quarter last year. Total income decreased to ₹407.51 lakh from ₹412.39 lakh. Asset quality remains a major concern with 100% gross and net NPA ratios. The corporation's reserves show a negative balance of ₹3,15,431.29 lakh, indicating severe net worth erosion. Auditors issued a qualified opinion, questioning the going concern basis of financial statements and highlighting unconfirmed dues to the Government of Gujarat.
*this image is generated using AI for illustrative purposes only.
Gujarat State Financial Corporation (GSFC) has announced its unaudited financial results for the first quarter, revealing a continued struggle with financial performance and asset quality.
Financial Performance
GSFC reported a net loss of ₹3,102.13 lakh for Q1, slightly improving from a loss of ₹3,121.71 lakh in the same quarter last year. The corporation's total income decreased to ₹407.51 lakh from ₹412.39 lakh year-over-year.
Key Financial Metrics
| Particulars (₹ in Lakh) | Q1 (Current) | Q1 (Previous) | Change |
|---|---|---|---|
| Total Income | 407.51 | 412.39 | -1.18% |
| Interest Earned | 9.25 | 52.67 | -82.44% |
| Other Income | 398.26 | 359.72 | +10.71% |
| Interest Expended | 3,501.82 | 3,456.48 | +1.31% |
| Operating Expenditure | 58.28 | 71.34 | -18.31% |
| Net Loss | 3,102.13 | 3,121.71 | -0.63% |
Asset Quality Concerns
The corporation's asset quality remains a significant concern, with both gross and net Non-Performing Asset (NPA) ratios standing at 100%. This indicates that all of GSFC's advances are classified as non-performing.
Capital Structure and Reserves
GSFC's paid-up equity share capital remains unchanged at ₹8,911.40 lakh. However, the corporation's reserves show a substantial negative balance of ₹3,15,431.29 lakh, highlighting the severe erosion of its net worth.
Ownership and Governance
The Government of Gujarat continues to hold a majority stake of 55.09% in the corporation.
Auditor's Observations
The statutory auditors, M/s. Pankaj R Shah & Associates, have issued a qualified opinion on the financial results, citing two main concerns:
- The corporation's financial results are prepared on a going concern basis despite its completely eroded net worth and default in repayment obligations.
- Dues payable to the Government of Gujarat are subject to confirmation and adjustment, potentially affecting interest and penal interest calculations.
Management's Response
GSFC's management maintains that as a statutory body established under the State Financial Corporations Act, 1951, it continues to operate on a going concern basis. The corporation is awaiting a decision from the Government of Gujarat regarding a proposal to make the loans advanced to GSFC interest-free from July 1, 2012.
Despite the challenging financial situation, GSFC continues its operations, focusing on its recovery function and its role in promoting balanced regional growth through financial assistance to micro and small-scale units in Gujarat.
Historical Stock Returns for Gujarat State Financial Corp
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -1.20% | -3.86% | -9.71% | -22.89% | -40.71% | +670.72% |
19
