Infronics Systems Limited has reported a challenging first quarter, with zero revenue and a net loss of Rs 17.03 lakhs. The company's performance marks a significant decline from the same quarter last year when it posted a revenue of Rs 79.06 lakhs and a net profit of Rs 43.93 lakhs.

Financial Performance

For the quarter under review:

The company's performance shows a stark contrast to the previous year, with a 100% decline in revenue and a shift from profit to loss.

Revenue Decline

The company's revenue drop to zero is attributed to the conclusion of SMS service contracts with BSNL from the previous financial year, which have not been renewed. This highlights Infronics Systems' current struggle with maintaining active business operations.

Operational Challenges

Infronics Systems is currently facing operational challenges due to the lack of active business. However, the management has stated that the company maintains sufficient cash balances to settle all liabilities as of the quarter-end, and those estimated to arise in the next twelve months.

Future Outlook

The management is exploring and researching the development of a new technological product. However, no concrete details have been provided regarding this initiative.

Legal Dispute

Infronics Systems has received a demand notice from M/s Mudunuru Limited for Rs 12.05 crore. The company disputes this claim as false and fabricated, stating that all obligations under their last business arrangement, which ended in October 2022, have been fully settled. The management has obtained legal opinion suggesting that the company's defense is likely to succeed.

Management's Statement

In the regulatory filing, the company stated, "The Customer Contracts with BSNL for providing SMS services to various banks were fully concluded during the previous financial year. These contracts have not been renewed subsequently and on account of this currently, there is no active business undertaken by the company."

Despite the current challenges, Infronics Systems Limited remains committed to exploring new business opportunities and maintaining its financial stability. Investors and stakeholders will be keenly watching the company's efforts to develop new revenue streams and return to profitability in the coming quarters.

Infronics Systems Limited , a technology company based in Hyderabad, has approved its unaudited financial results for the quarter ended June 30, amidst auditor qualifications on two significant issues. The company's board meeting, held on August 14, addressed these concerns while affirming its commitment to future growth.

Auditor Qualifications

The auditor's limited review report highlighted two key issues:

1. Demand Notice from Mudunuru Limited: A demand notice for ₹12.05 crore has been received from Mudunuru Limited. This amount comprises ₹8.60 crore in principal and ₹3.45 crore in interest, related to alleged pro-forma invoices raised between March 2023 and April 2025.

2. Going Concern Uncertainty: The auditor expressed material uncertainty about the company's status as a going concern.

Management's Response

Infronics Systems' management has provided detailed responses to these qualifications:

Demand Notice

• The company has categorically denied any liability regarding the ₹12.05 crore demand from Mudunuru Limited.
• After internal evaluation, management concluded that the claim is invalid.
• In accordance with Ind AS 37, no provision has been recognized in the financial statements.
• The matter has been disclosed as a contingent liability.

Going Concern Issue

• Management acknowledged that a previous key engagement concluded in the last financial year, changing the nature of revenue inflows.
• The company is currently focusing on ongoing technological product development initiatives.
• These initiatives are expected to contribute to future business prospects.
• The Q1 results have been prepared on a going-concern basis.

Board Meeting Details

• The board meeting was held on August 14, at the company's registered office in Hyderabad.
• The meeting commenced at 6:00 PM IST and concluded at 7:30 PM IST.
• The Un-Audited Financial Results for Q1 were approved along with the Auditor's Limited Review Report.

Trading Window

Investors should note that the trading window for Infronics Systems' shares remains closed. It will reopen 48 hours after the publication of the Q1 unaudited financial results.

Management's Outlook

Despite the challenges highlighted in the auditor's report, Infronics Systems' management remains optimistic about its future prospects. The company is betting on its ongoing technological product development initiatives to drive future growth and address the concerns raised about its going concern status.

Investors and stakeholders are advised to monitor further announcements from the company for updates on its financial position and strategic initiatives.