Kothari Fermentation & Biochem Limited , a yeast manufacturing company, has reported a substantial net loss for the quarter ended September 30, 2025, raising concerns about its financial health and compliance issues.

Financial Performance

The company's financial results for the second quarter of the fiscal year 2025-26 paint a challenging picture:

The net loss for Q2 FY2025-26 stood at Rs. 307.72 lakhs, a significant increase from the loss of Rs. 112.46 lakhs in the previous quarter. This represents a deterioration in the company's financial performance, with the loss widening by approximately 173% quarter-over-quarter.

Operational Challenges

The company's operational expenses have seen an uptick, particularly in power and fuel costs, which amounted to Rs. 628.06 lakhs for the quarter. This increase in operational costs, coupled with a slight decline in revenue from operations compared to the same quarter last year, has contributed to the expanded losses.

Compliance Concerns

Adding to the financial woes, Kothari Fermentation & Biochem is facing compliance issues. The company has reported outstanding statutory dues, including:

• TDS (Tax Deducted at Source) of Rs. 4.85 lakhs
• PF (Provident Fund) of Rs. 9.82 lakhs

These dues have been pending for over six months, raising concerns about the company's ability to meet its statutory obligations.

Cash Flow and Liquidity

The cash flow statement reveals some positive movements despite the overall financial strain:

• Net cash flow from operating activities for the half-year ended September 30, 2025, was Rs. 420.01 lakhs.
• Cash and cash equivalents at the end of the period increased to Rs. 59.13 lakhs from Rs. 24.09 lakhs at the beginning of the period.

However, the company's ability to manage its short-term liabilities and improve its working capital position remains crucial.

Outlook

The consecutive quarterly losses and compliance issues present significant challenges for Kothari Fermentation & Biochem. The company's management will need to address these concerns promptly to restore investor confidence and improve its financial health.

Investors and stakeholders should closely monitor the company's efforts to reduce operational costs, improve revenue, and resolve the outstanding statutory dues in the coming quarters.

Kothari Fermentation & Biochem , a key player in the yeast and cattle feed industry, has reported a net loss for the first quarter, alongside significant changes to its board composition.

Financial Performance

The company announced a net loss of Rs 112.46 lakhs for the quarter, a stark contrast to the net profit of Rs 109.78 lakhs recorded in the same quarter of the previous year. This shift represents a significant downturn in the company's financial performance.

Revenue from operations also saw a decline, dropping to Rs 2375.31 lakhs from Rs 2635.52 lakhs year-on-year, indicating challenging market conditions for the company's products.

The earnings per share (EPS) turned negative at Rs (0.75), compared to a positive Rs 0.73 in the corresponding quarter last year, reflecting the impact of the loss on shareholder value.

Board and Management Changes

In a series of strategic moves, the company's board approved several key appointments and changes:

1. M/s Priyanka Saxena & Associates, a peer-reviewed firm, has been appointed as secretarial auditors for a five-year term, subject to shareholder approval at the upcoming Annual General Meeting (AGM).

2. Mr. Siddhant Kothari has been re-appointed as whole-time director, pending shareholder approval. Mr. Kothari, at approximately 31 years old, represents the next generation of leadership within the company.

3. Dr. Rajiv Agarwal has resigned from his position as Independent Director, citing preoccupation as the reason for his departure.

4. Mr. Varun Kumar has been appointed as an Additional Non-Executive Independent Director for a five-year term, bringing with him over 15 years of entrepreneurial experience in the manufacturing sector.

Corporate Governance

The company has also announced the reconstitution of its key committees following Dr. Agarwal's resignation. The Audit Committee, Nomination and Remuneration Committee, and Stakeholders' Relationship Committee have all seen changes in their composition to ensure continued effective governance.

Annual General Meeting

Kothari Fermentation & Biochem has scheduled its 35th Annual General Meeting for September 30, where shareholders will have the opportunity to vote on these board changes and appointments.

Auditor's Review

The independent auditor's review highlighted an outstanding issue regarding statutory dues. As of the review date, Provident Fund (PF) dues amounting to Rs 9.59 lakhs, pertaining to the period prior to the quarter, were outstanding for over six months.

This comprehensive update from Kothari Fermentation & Biochem reflects a period of financial challenges coupled with significant organizational changes. The company appears to be positioning itself for future growth and improved governance, despite the current financial setback. Investors and stakeholders will likely be watching closely to see how these changes impact the company's performance in the coming quarters.