Hariyana Ship-Breakers Reports 194% Surge in Q1 Profit, Reappoints Managing Director

Hariyana Ship Breakers Limited, a prominent player in the ship-breaking industry, has reported a significant increase in its quarterly profit for the period ended June 30. The company's financial results, coupled with key management decisions, paint a picture of resilience and strategic growth.

Financial Performance Highlights

Hariyana Ship-Breakers witnessed a remarkable 194% year-on-year increase in its standalone net profit for the quarter ended June 30. The company reported a net profit of Rs 68.32 lakh, compared to Rs 23.24 lakh in the same period last year. This substantial growth in profitability comes despite challenges in the operational environment.

The company's total income for the quarter stood at Rs 217.10 lakh, slightly lower than the Rs 230.87 lakh reported in the corresponding quarter of the previous year. Notably, Hariyana Ship-Breakers did not generate any revenue from operations during this period, with income primarily derived from other sources.

Key Financial Metrics

Operational Challenges and Strategic Focus

It's worth noting that Hariyana Ship-Breakers has not carried out any business operations for the last three quarters. This operational pause is reflected in the absence of revenue from operations in the current quarter. Despite these challenges, the company has maintained its profitability, primarily through effective management of other income sources and cost control measures.

Management Changes and Future Outlook

In a significant move, the Board of Directors has re-appointed Mr. Rakesh Reniwal as the Managing Director of the company for a five-year term, effective from April 1, 2025, to March 31, 2030. Mr. Reniwal, aged 51, brings over two decades of experience in the ship-breaking industry and has been instrumental in the company's growth.

Auditor's Observations

The company's auditors have highlighted a few key points in their review:

1. The company has an advance of Rs 131.90 crore for establishing a joint venture, constituting 8.17% of total assets. This investment has been carried forward for an extended period without commencing joint venture activities.
2. An overdraft facility of Rs 11.87 crore from Punjab National Bank has been utilized, with the auditors unable to comment on its specific purpose due to the absence of clear utilization details.
3. The company has significant investments in partnership firms focused on real estate development, totaling Rs 139.54 crore as of June 30, which represents 83.26% of the company's total assets.

Conclusion

While Hariyana Ship-Breakers faces operational challenges, its financial performance in the quarter ended June 30 demonstrates resilience and effective financial management. The reappointment of Mr. Rakesh Reniwal as Managing Director signals continuity in leadership. However, investors and stakeholders should closely monitor the company's strategies to resume operational activities and diversify its revenue streams in the coming quarters.