CL Educate Receives ₹15.46 Crore GST Demand Order on Former Subsidiary CL Media

CL Educate Limited has received a significant GST demand order of ₹15.46 crores related to its former subsidiary CL Media Private Limited. The order was issued by the Office of the Assistant Commissioner of Central GST, Delhi South, and received by the company on January 5, 2026.

GST Order Details

The demand pertains to CL Media Private Limited, which was a wholly-owned subsidiary of CL Educate before merging into the parent company in March 2022. The GST authorities have raised concerns about alleged excess availment of Input Tax Credit during a four-year period from FY2018-19 to FY2021-22.

Parameter	Details
Issuing Authority	Office of the Assistant Commissioner of Central GST, Delhi South
Order Date	December 26, 2025
Receipt Date	January 5, 2026
Total Demand	₹15.46 crores
Period Covered	FY2018-19 to FY2021-22
Alleged Violation	Excess Input Tax Credit availment

Financial Impact and Company Response

According to management commentary, the core tax amount in question is approximately ₹1.40 crores, with the final demand of ₹15.46 crores being magnified due to penalties imposed on both the company and its multiple directors. The period in question coincides with the COVID-19 disruption and early years of GST implementation.

The company has decided to contest the order through the statutory appellate process after conducting an internal review. CL Educate will engage its tax advisors to file an appeal against the GST demand.

Regulatory Compliance and Disclosure

As per SEBI regulations, the company has disclosed this development under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The matter will be treated as a contingent liability in the company's financial statements for the year ending March 31, 2026, should the liability persist.

Compliance Aspect	Details
Regulation	SEBI Regulation 30
Financial Treatment	Contingent Liability
Accounting Period	FY2025-26
Next Steps	Statutory Appeal Process

Management Assurance

The management has assured stakeholders of its commitment to maintaining the highest standards of regulatory compliance, transparency, and responsible governance. The company emphasized that it will handle the matter through appropriate accounting and audit processes while pursuing the appellate route to contest the GST order.

This development affects CL Educate's Student Outreach business, which was previously operated through CL Media Private Limited before the merger in March 2022.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+0.15%	-5.35%	-2.03%	-12.07%	-24.98%	+332.16%

CL Educate Limited (ISIN: INE201M01029) has reported a significant boost in its financial performance for the first half of fiscal year 2026, driven by the successful integration of its DEXIT Global business. The company's revenue witnessed a substantial year-on-year growth of 64%, reaching Rs 319.00 crores in H1 FY26.

Key Financial Highlights

Metric	H1 FY26	YoY Change
Revenue	Rs 319.00 crores	↑ 64%
EBITDA	Rs 50.00 crores	↑ 101%
Net Profit	Rs 1.50 crores	↓ 80%

DEXIT Global's Contribution

The newly acquired DEXIT Global business, which includes the integrated NSEIT operations, has made a substantial contribution to CL Educate's top-line growth. DEXIT Global alone accounted for Rs 139.00 crores of the total revenue, underlining the strategic importance of this acquisition.

Operational Performance

Despite the challenges, CL Educate demonstrated strong operational performance:

EBITDA Growth: The company's EBITDA saw a remarkable increase of 101%, reaching Rs 50.00 crores. This growth indicates improved operational efficiency and cost management.

Profitability Challenges

While the revenue and operational metrics showed significant improvement, the company's bottom line faced some headwinds:

Net Profit Decline: Net profit decreased to Rs 1.50 crores from Rs 7.50 crores in the previous year.
Higher Finance Costs: The decline in net profit is primarily attributed to increased finance costs of Rs 26.00 crores, stemming from acquisition-related borrowings.
Increased Depreciation: The company also experienced higher depreciation charges, likely due to the expanded asset base following the NSEIT acquisition.

Future Outlook

During the recent earnings call, management provided insights into various business segments:

Undergraduate Programs: The company sees potential growth in UG programs, while MBA programs are expected to maintain their current position.
CUET (Common University Entrance Test): While challenges persist, there are early signs of improvement in the test's difficulty level, which could benefit CL Educate's test preparation business in the future.
Law Entrance Exams: The shift in exam schedules has led to changes in student preparation patterns, with a trend towards longer-term programs.
Platform Monetization: This segment is performing well, helping institutes reach out to students effectively.
Publishing: The company is exploring bundling services with books and focusing on direct sales through gkpublications.com to improve margins.
AI Integration: CL Educate is incorporating AI into academic support, including SOP analysis and doubt-solving for students.

The company's management has indicated that while they do not provide specific guidance, they are prepared to make necessary investments in people, products, and technology as business demands evolve.

CL Educate's strong revenue growth, coupled with strategic initiatives across various segments, positions the company for potential future growth. However, managing finance costs and improving bottom-line performance will be crucial for sustaining long-term profitability.