Jayabharat Credit Limited (JCL), a company with a history dating back to 1943, has announced its unaudited financial results for the second quarter and half year ended September 30. The company continues to face significant financial challenges, as reflected in its latest financial report.

Financial Performance

JCL reported a net loss of ₹24.45 lakhs for the quarter ended September 30. This loss is part of a broader pattern of financial difficulties the company has been experiencing. The company's financial position remains precarious, with accumulated losses of ₹7,604.74 lakhs and current liabilities exceeding total assets by ₹6,137.05 lakhs, resulting in a negative net worth.

Key Financial Metrics

Business Activities and Financial Support

The company disclosed that it is not currently engaged in any active business activities. Despite this, JCL continues to operate on a going concern basis, primarily due to the financial support received from its promoters. The promoters have provided inter-corporate deposits amounting to ₹6,092.02 lakhs, which helps the company meet its financial requirements, including operational expenses.

Auditor's Observations

The company's auditors, Jagdish Chand & Co., have noted a material uncertainty regarding JCL's ability to continue as a going concern. However, the financial results have been prepared on a going concern basis, considering the ongoing financial support from the promoters.

Balance Sheet Overview

As of the reporting date:

• Total Assets: ₹11.20 lakhs
• Total Equity: ₹(6,137.05) lakhs
• Current Liabilities: ₹6,148.25 lakhs

Future Outlook

While the company continues to face significant financial challenges, the ongoing support from promoters suggests a commitment to maintaining the company's operations. However, the lack of active business activities and the persistent negative net worth raise questions about the company's long-term viability and potential turnaround strategies.

Investors and stakeholders may want to closely monitor future developments and any potential changes in the company's business strategy or financial structure.

Jayabharat Credit (formerly known as JA Yabharat Credit Limited) has undergone a significant change in its ownership structure as Motor & General Finance Limited (MGF) divested its entire stake in the company. The transaction, which took place on September 18, involved the sale of 680,000 shares, representing 13.6% of Jayabharat Credit's total voting rights.

Transaction Details

The stake sale was executed through an off-market transaction, as confirmed by the disclosure made under Regulation 29(2) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. Following this sale, MGF's shareholding in Jayabharat Credit has been reduced to zero from its previous 13.6% stake.

Impact on Shareholding

Before the transaction:

• MGF held 680,000 shares, accounting for 13.6% of Jayabharat Credit's voting rights.
• The total equity share capital of Jayabharat Credit stood at 5,000,000 shares.

After the transaction:

• MGF's shareholding in Jayabharat Credit has been completely eliminated.
• The total equity share capital of Jayabharat Credit remains unchanged at 5,000,000 shares.

Market Implications

Jayabharat Credit's shares are listed on the Bombay Stock Exchange (BSE). The substantial exit by a significant shareholder like MGF could potentially impact the stock's trading dynamics and investor perception.

Regulatory Compliance

The transaction adheres to the regulatory requirements, with MGF filing the necessary disclosures as mandated by SEBI regulations. The company confirmed that it did not belong to the promoter or promoter group of Jayabharat Credit.

This strategic move by Motor & General Finance Limited to completely exit its position in Jayabharat Credit marks a notable shift in its investment portfolio. Market participants and investors in Jayabharat Credit will likely be watching closely for any potential changes in the company's direction or performance following this significant change in its shareholding pattern.