Simbhaoli Sugars FY25 Audited Results Receive Adverse Opinion from Auditors
Simbhaoli Sugars Limited's FY25 consolidated financial results received an adverse opinion from statutory auditors Mittal Gupta & Co., highlighting material accounting irregularities including ₹1,75,029.63 lakhs cumulative unprovided interest on borrowings and significant issues across subsidiary companies. The audit revealed substantial understatement of liabilities and overstatement of assets, with the company operating under Corporate Insolvency Resolution Process since July 2024.
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Simbhaoli Sugars Limited's consolidated financial results for FY25 have received an adverse opinion from statutory auditors Mittal Gupta & Co., highlighting significant material uncertainties and accounting irregularities amid the company's ongoing Corporate Insolvency Resolution Process (CIRP).
Auditor's Adverse Opinion Details
The independent auditor's report dated March 11, 2026, issued an adverse opinion on the consolidated annual financial results, stating that the financial statements "do not give a true and fair view" due to material and pervasive issues. The audit covered the holding company and its subsidiaries: Integrated Casetech Consultants Private Limited (ICCPL), Simbhaoli Specialty Sugars Private Limited (SSSPL), and Simbhaoli Power Private Limited (SPPL).
Major Financial Irregularities Identified
The auditors identified several critical issues affecting the financial statements' accuracy:
| Issue Category: | Amount (₹ Lakhs) | Impact |
|---|---|---|
| Unprovided Interest on Borrowings (FY25): | 63,937.03 | Net loss understated |
| Cumulative Unprovided Interest: | 1,75,029.63 | Liabilities understated |
| Cane Price Interest Claims: | 12,163.25 | Current liabilities understated |
| Director Remuneration Issues: | 355.83 | Non-compliance with Section 197 |
| CFO Remuneration Not Provided: | 9.23 | Expenses understated |
CIRP Status and Going Concern Issues
The company has been under CIRP since July 11, 2024, following an NCLT Allahabad Bench order, with Mr. Anurag Goel appointed as Interim Resolution Professional. The National Company Law Appellate Tribunal (NCLAT) issued an interim order on July 24, 2024, staying further CIRP proceedings while allowing the IRP to continue managing operations, with the next hearing scheduled for March 24, 2026.
The auditors expressed significant doubt about the company's ability to continue as a going concern, citing continuous cash losses, current liabilities exceeding current assets, defaults in payments to lenders and sugarcane farmers, and negative net worth.
Subsidiary Company Challenges
The audit revealed serious issues across subsidiary companies:
Simbhaoli Power Private Limited received a disclaimer of opinion due to:
- Non-operational turbine throughout the year causing revenue decline
- Disputed receivables of ₹1,116.19 lakhs from holding company
- Pending legal proceedings alleging oppression and mismanagement
Integrated Casetech Consultants Private Limited received an adverse opinion for:
- Unbilled revenue disputes of ₹462.57 lakhs without adequate provisions
- Long-outstanding receivables totaling ₹234.31 lakhs without impairment
- Overstated deferred tax assets of ₹108.56 lakhs
Financial Impact Assessment
The auditors provided a detailed impact analysis showing significant differences between reported and adjusted figures:
| Parameter: | Reported Figures | Adjusted Figures | Variance |
|---|---|---|---|
| Net Loss (₹ Lakhs): | 1,975.07 | 1,90,087.62 | Significantly higher loss |
| Total Liabilities (₹ Lakhs): | 2,13,065.47 | 4,00,267.58 | Substantially understated |
| Net Worth (₹ Lakhs): | -9,814.39 | -1,97,926.94 | Materially worse position |
Management Response and IRP Oversight
The company's management, operating under IRP supervision, acknowledged the audit qualifications while expressing confidence in resolving disputes and continuing operations through the CIRP framework. The financial results were signed by CFO Dayal Popli and taken on record by IRP Anurag Goel, with appropriate disclaimers regarding the IRP's limited liability for the financial statements' accuracy.
The IRP emphasized that these consolidated financial statements have been taken on record solely for statutory compliance purposes, with the IRP not accepting personal liability for any errors or misstatements in the accounts.
Historical Stock Returns for Simbhaoli Sugars
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +2.70% | +0.14% | -16.42% | -47.68% | -47.99% | +12.09% |
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