Morarjee Textiles Reports Widening Losses Amid Ongoing Challenges

Morarjee Textiles Limited , a prominent player in the Indian textile industry, has reported a significant increase in net losses for the half year ended September 30, 2020. The company continues to face headwinds due to the COVID-19 pandemic and other financial challenges.

Financial Performance

The company's financial results for the half year paint a challenging picture:

Metric	H1 FY2021	H1 FY2020	Change
Net Loss	₹3,467.00 lakhs	₹868.00 lakhs	299.40%
Revenue from Operations	₹5,551.00 lakhs	₹18,472.00 lakhs	-69.90%
Basic and Diluted EPS	-₹9.54	-	-

The substantial increase in net loss and the sharp decline in revenue underscore the severe impact of the COVID-19 lockdown on Morarjee Textiles' operations.

Operational Challenges

Morarjee Textiles faced significant operational hurdles during the period:

COVID-19 Impact: The lockdown affected production and sales for almost two months, resulting in very low demand.
Export Performance Guarantee: An export performance bank guarantee of USD 16.15 million (approximately ₹11,891.00 lakhs) was invoked due to non-payment of service fees and interest.
Preference Shares Redemption: The company has been unable to redeem preference shares worth ₹10.00 crores that were due in November 2019.

Management's Response

Despite the challenges, the management has expressed confidence in arranging sufficient liquidity. They have taken proactive steps to address the financial situation:

NCLT Approach: The company has approached the National Company Law Tribunal (NCLT) for re-issuance of preference shares for a 20-year term.
Liquidity Management: Efforts are underway to improve the company's liquidity position.

Recent Financial Trends

Analyzing the most recent quarterly data available, some concerning trends emerge:

Metric	Q4 FY2024	Q3 FY2024	QoQ Change
Revenue	₹13.60 crore	₹9.30 crore	46.24%
Net Profit	-₹105.60 crore	-₹30.60 crore	-245.10%
EBITDA	-₹12.10 crore	-₹5.40 crore	-124.07%

While there's a quarter-on-quarter increase in revenue, the company's losses have widened significantly, indicating persistent challenges in its operations and financial management.

Outlook

The textile industry continues to face headwinds due to global economic uncertainties and the lingering effects of the pandemic. Morarjee Textiles' ability to navigate these challenges, improve its operational efficiency, and strengthen its financial position will be crucial for its future performance.

Investors and stakeholders will be closely watching the company's efforts to restructure its debt, improve liquidity, and return to profitability in the coming quarters.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
-0.56%	+0.90%	-1.65%	+30.85%	-11.39%	+0.56%

Morarjee Textiles Limited , a company currently undergoing Corporate Insolvency Resolution Process (CIRP), has recently held two significant meetings of its Committee of Creditors (COC) as part of its ongoing proceedings under the Insolvency and Bankruptcy Code 2016.

28th Committee of Creditors Meeting

The company convened its Twenty Eighth Meeting of the Committee of Creditors on September 12, 2023, at 2:00 p.m. This meeting was a crucial part of the company's ongoing insolvency process.

29th Committee of Creditors Meeting

Following closely, Morarjee Textiles held its Twenty Ninth Meeting of the Committee of Creditors on September 22, 2023, at 5:30 p.m. This rapid succession of meetings indicates the active management of the company's insolvency proceedings.

Management Under Insolvency

The company's affairs, business, and assets are currently being managed by Mr. Ravi Sethia, who was initially appointed as the interim resolution professional by the National Company Law Tribunal, Mumbai, on February 9, 2023. Mr. Sethia's appointment was subsequently confirmed as the Resolution Professional by the Committee of Creditors on May 22, 2023.

Regulatory Compliance

In adherence to regulatory requirements, Morarjee Textiles has duly informed the stock exchanges about these meetings. The notifications were made in compliance with:

Regulation 30 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015
Sub-clause 16(g) of Clause A of Part A of Schedule III of LODR

Company Leadership

Despite the ongoing insolvency process, Kishore Dhage continues to serve as the CEO, Whole Time Director, and Compliance Officer of Morarjee Textiles Limited. Mr. Dhage has been responsible for communicating these developments to the relevant stock exchanges.

The frequent meetings of the Committee of Creditors suggest that Morarjee Textiles is actively working through its insolvency process. Stakeholders will be keenly watching for further developments as the company navigates this challenging period.