Siti Networks Limited, a company currently undergoing Corporate Insolvency Resolution Process (CIRP), has reported a standalone net loss of ₹437.64 million for the quarter ended June 30. This loss, while significant, shows a slight improvement from the ₹530.17 million loss recorded in the previous quarter.

Financial Performance

The company's financial results, as approved by the Resolution Professional and CEO, reveal a challenging fiscal landscape:

The revenue from operations saw a marginal decline to ₹799.55 million from ₹818.25 million in the prior quarter.

Insolvency Proceedings and Financial Position

Siti Networks has been under CIRP since February 2023, with operations being managed by a Resolution Professional. The company's financial health remains precarious:

• Negative net worth of ₹13,380.37 million
• Negative working capital of ₹17,278.93 million
• Financial creditors' claims of ₹12,060.33 million, with ₹11,292.66 million admitted

Consolidated Performance

On a consolidated basis, the group reported:

• Net loss of ₹441.32 million
• Revenue from operations at ₹2,706.76 million

Auditor's Observations

The statutory auditors have disclaimed their opinion on the financial results, citing multiple uncertainties related to the insolvency proceedings. Key points from the auditor's report include:

• Ongoing litigations and appeals regarding the CIRP process
• Non-provision of additional and penal interest on loans classified as Non-Performing Assets
• Discrepancies in claims submitted by creditors and balances in books
• Concerns over the company's ability to continue as a going concern

Management's Stance

Despite the financial challenges, the management has prepared the financial statements on a going concern basis, citing the ongoing CIRP process. However, the auditors have expressed inability to obtain sufficient evidence regarding the use of this assumption.

Regulatory Compliance

The company has stated that the financial results have been prepared in accordance with the Indian Accounting Standards and SEBI regulations. However, the auditors have raised concerns about the presentation of certain revenue items, particularly the inclusion of broadcasters' share in subscription income.

As Siti Networks navigates through its insolvency process, the outcome of the ongoing resolution efforts will be crucial for its future operations and financial stability. Stakeholders will be closely monitoring the developments in the CIRP and any potential resolution plans that may emerge.

Siti Networks Limited , a player in the Indian cable TV and broadband services sector, has reported loan defaults exceeding ₹1,000 crores to multiple lenders. This development comes as the company navigates through a Corporate Insolvency Resolution Process (CIRP).

Loan Default Details

Siti Networks disclosed defaults on loan payments to several financial institutions, including:

• ARCIL
• IDBI Bank
• RBL Bank
• Axis Bank
• Others

The company's total outstanding claims from these institutions exceeded ₹1,000 crores as of October 31.

Insolvency Proceedings

The company is currently undergoing a Corporate Insolvency Resolution Process initiated in February 2023. Key points regarding the insolvency proceedings include:

• The CIRP was initiated by the National Company Law Tribunal (NCLT).
• Multiple appeals are pending before the Supreme Court regarding the insolvency proceedings.
• Ongoing legal proceedings at the Supreme Court are addressing financial creditor claims and payment obligations.

Legal Developments

The insolvency process has been marked by several legal challenges:

1. The matter is currently sub judice in the Supreme Court.
2. The Supreme Court is reviewing issues related to financial creditor claims and payment obligations.

Implications

The substantial loan defaults and ongoing insolvency proceedings pose significant challenges for Siti Networks. The company's financial stability and operational capabilities are likely to be under stress as it navigates through this complex situation. Stakeholders, including investors and creditors, will be closely monitoring the outcomes of the legal proceedings and the company's efforts to resolve its financial obligations.

As the insolvency process unfolds and legal battles continue, the resolution of these financial and legal challenges will be crucial for Siti Networks' operations in the Indian cable TV and broadband services market.