NewsEarningsManraj Housing Finance Reports Net Loss, Auditors Issue Adverse Opinion on Q2 ResultsManraj Housing Finance Reports Net Loss, Auditors Issue Adverse Opinion on Q2 Results
Manraj Housing Finance Limited announced a net loss of Rs. 4.44 lakhs for Q2 ended September 30. Statutory auditors issued an adverse opinion, highlighting critical issues: 95% of assets are advances to related parties under ED investigation, 64.8% of liabilities are unsecured loans from related parties, and the company has defaulted on bank borrowings of Rs. 687.03 lakhs since February 2020. The company's non-operational status for over 4 years and negative net worth raise doubts about its ability to continue as a going concern.
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Manraj Housing Finance Limited has announced its unaudited financial results for the quarter and half-year ended September 30, revealing significant financial challenges and raising concerns about the company's future.
Financial Performance
The company reported a net loss of Rs. 4.44 lakhs for the quarter ended September 30. This loss comes amid a series of critical issues highlighted by the statutory auditors, who issued an adverse opinion on the financial results.
Key Financial Metrics
| Particulars | Q2 (Rs. in lakhs) | Q1 (Rs. in lakhs) | Q2 Previous Year (Rs. in lakhs) |
|---|---|---|---|
| Total Income | 1.02 | 1.02 | 0.86 |
| Total Expenses | 5.50 | 35.08 | 4.95 |
| Net Profit/(Loss) | (4.48) | (34.06) | (4.09) |
| EPS (Basic & Diluted) | (0.09) | (0.68) | (0.08) |
Auditors' Concerns
The statutory auditors have raised several critical issues in their review:
Related Party Advances: Approximately 95% of the company's assets are advances to related parties currently under investigation by the Enforcement Directorate under the Prevention of Money Laundering Act. The related assets have been attached by the ED, raising significant concerns about the recoverability and valuation of these advances.
Unsecured Loans: About 64.8% of the company's liabilities are unsecured loans from related parties, creating uncertainty about the completeness and accuracy of the company's liabilities.
Loan Default: The company has defaulted on bank borrowings of Rs. 687.03 lakhs since February 2020. Unprovided interest and penalties total Rs. 637.86 lakhs, understating the company's losses and liabilities.
Going Concern Issues: The auditors noted that the company has not been operational for more than 4 years and has a negative net worth, raising serious doubts about its ability to continue as a going concern.
Management Response
The company's management has not provided any specific comments or plans to address these issues in the financial results announcement. The board of directors approved the unaudited financial results in their meeting held on November 10.
Market Implications
The adverse audit opinion and the company's financial struggles may have significant implications for investors and stakeholders. The issues raised by the auditors, particularly the concerns about related party transactions and loan defaults, could potentially impact the company's credibility and future financing options.
Investors and market watchers will likely be looking for clear communication from Manraj Housing Finance Limited's management regarding their plans to address these financial challenges and restore the company's operational status.
As the situation develops, regulatory authorities may also take a closer look at the company's operations and financial practices, given the severity of the issues highlighted in the auditor's report.
Historical Stock Returns for Manraj Housing Finance
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -100.00% | -100.00% | -100.00% | -100.00% | -100.00% | -100.00% |
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