Priya Limited Reports Significant Losses and NPA Status Amid Ongoing Financial Challenges

Priya Limited , a company facing severe financial distress, has released its unaudited financial results for the quarter and nine months ended September 30, revealing a deepening crisis. The company's board approved these results, which paint a grim picture of its financial health and operational status.

Financial Performance

The company reported a net loss of Rs 94.56 lakh for the quarter, contributing to a negative net worth of Rs 5,084.66 lakh. This financial deterioration is part of a continuing trend, with the company incurring losses in both current and past periods.

Banking Issues and NPA Status

Priya Limited's accounts have been declared Non-Performing Assets (NPAs) by three major banks:

1. Indian Bank
2. Bank of Maharashtra
3. Union Bank of India

All three banks have taken the severe step of declaring the company, its promoters, directors, and corporate guarantors as willful defaulters. The management has reportedly contested these declarations.

Operational Challenges

The company's operational status has significantly deteriorated:

• Ceased all business operations due to blocked bank accounts
• Closed all branches except for Mumbai
• Laid off the majority of its employees across branches
• Revenue from operations during the current year is nil

Property Auctions and Debt Settlement Attempts

In an attempt to recover dues, the banks have taken several actions:

• Properties in Mumbai, Kolkata, and Chennai were auctioned
• The company voluntarily handed over possession of one Mumbai property to the bank
• A one-time settlement proposal was submitted, with Rs 175 lakh deposited against a proposed settlement of Rs 22.81 crore

Audit Concerns

The company's auditors, M/s. JM & Associates, have issued an adverse opinion, citing multiple concerns:

1. A provision of Rs 3,269.64 lakh for doubtful debts related to export sales
2. Vacancy in the Chief Financial Officer position since November 2022
3. Related party transactions not conducted at arm's length, including rent income receivable of Rs 74.86 lakh from a group company

Insolvency Proceedings of Related Parties

Two related parties of Priya Limited have initiated Corporate Insolvency Resolution Process:

1. VXL Instruments Limited (CIRP commencement date: 26.11.2024)
2. VXL Software Solutions Pvt. Ltd. (CIRP commencement date: 26.02.2025)

Change in Registered Office

The board has approved changing the company's registered office address within Mumbai, moving from Sharda Chambers to Chartered House in Dhobi Talao.

Conclusion

Priya Limited's financial results and accompanying disclosures reveal a company in deep financial distress, grappling with operational cessation, asset auctions, and significant banking issues. The adverse audit opinion and ongoing challenges paint a concerning picture for the company's future prospects.

Investors and stakeholders should closely monitor further developments, particularly regarding the company's debt settlement efforts and any potential restructuring plans.