Amarnath Securities posts Rs 0.91 lakh profit on other income

Amarnath Securities Limited reported a Rs 0.91 lakh profit for the half year ended September 30, 2026, although revenue from operations was nil; Rs 21.87 lakh of other income exceeded Rs 20.96 lakh of expenses, while total equity remained negative Rs 72.13 lakh.

Why did Amarnath Securities report a profit without operating revenue?

Amarnath Securities reported nil revenue from operations for the half year ended September 30, 2026, compared with Rs 19.04 lakh in the corresponding half year ended September 30, 2025. The Rs 0.91 lakh half-year profit therefore came after other income of Rs 21.87 lakh, rather than from operating revenue in its sole Finance and Investment segment.

The half-year other income included Rs 6.87 lakh in the quarter ended September 30, 2026, and Rs 15 lakh in the quarter ended June 30, 2026. Amarnath Securities said the September-quarter amount arose from the write-back of a loan payable to a related party, recognised on management's decision. The Rs 6.87 lakh write-back accounted for all other income recorded in that quarter.

Total expenses were Rs 20.96 lakh in the six months ended September 30, 2026, against Rs 7.77 lakh in the corresponding prior-year period. Fees and commission expense was Rs 3.05 lakh, employee-benefit expense was Rs 4.35 lakh and other expense was Rs 13.46 lakh. With operating revenue falling to nil and costs rising, profit after tax declined from Rs 8.23 lakh a year earlier to Rs 0.91 lakh.

What does Amarnath Securities' balance sheet show?

Amarnath Securities had total equity of negative Rs 72.13 lakh at September 30, 2026, compared with negative Rs 73.04 lakh at March 31, 2026. Its equity share capital was Rs 3.0002 crore and other equity was negative Rs 3.7215 crore. The company stated that its entire net worth had been eroded.

Total assets rose to Rs 27.10 lakh at September 30, 2026 from Rs 6.49 lakh at March 31, 2026. Financial assets were Rs 27 lakh and included loans of Rs 20.89 lakh, cash and cash equivalents of Rs 2.16 lakh, other financial assets of Rs 2.81 lakh, other receivables of Rs 0.62 lakh and investments of Rs 0.51 lakh. Loans increased from Rs 2.50 lakh at the March 2026 year-end.

Total liabilities increased to Rs 99.24 lakh from Rs 79.53 lakh over the same period. Borrowings rose by Rs 22.60 lakh to Rs 78.55 lakh, while provisions fell to Rs 19.41 lakh from Rs 22.53 lakh. Financial liabilities totalled Rs 79.83 lakh and non-financial liabilities totalled Rs 19.41 lakh at September 30, 2026.

How did Amarnath Securities' cash flows change during the half year?

Amarnath Securities used Rs 23.70 lakh in operating activities from April 1, 2026 to September 30, 2026, compared with Rs 5.93 lakh generated from operations in the year ended March 31, 2026. The half-year outflow occurred despite profit before tax of Rs 0.91 lakh because the reported working-capital movements absorbed cash.

The largest stated operating movement was a Rs 18.39 lakh increase in long-term or short-term loans and advances. Other financial and non-financial assets rose by Rs 2.81 lakh, while trade receivables increased by Rs 0.62 lakh. Provisions decreased by Rs 3.11 lakh and trade payables and other liabilities added Rs 0.23 lakh, leaving cash generated from operations at negative Rs 23.70 lakh.

Financing activities provided Rs 22.51 lakh, reflecting Rs 22.60 lakh of short-term or long-term borrowing less Rs 0.08 lakh of finance cost. Investing activities used Rs 0.13 lakh for property, plant and equipment. The cash-flow statement reported cash and cash equivalents of Rs 2.18 lakh at September 30, 2026, down Rs 1.31 lakh from Rs 3.48 lakh at the start of the period; the balance-sheet statement showed Rs 2.16 lakh.

What qualifications and regulatory matters did Amarnath Securities disclose?

Amarnath Securities' statutory auditor issued a qualified conclusion on the unaudited quarter and half-year results for September 30, 2026. The auditor said it had not received documents concerning Reserve Bank of India, or RBI, compliance from the non-banking financial company and was unable to determine the possible effects, if any, on the financial results.

Amarnath Securities said that following a change in management, it had yet to make an application or intimation to the RBI seeking approval for the changes. RBI approval remained pending as of November 14, 2026, the date the financial statements were signed. The auditor also said management had not clarified details regarding liabilities that appeared to have been compromised, so it could not comment on their merits or quantify effects on profit or loss, assets and liabilities.

The review report cited missing or limited documentation for certain expenses, investments, and loans and advances. It specifically identified Rs 0.21 lakh of rent expense in the September 2026 quarter for premises whose leave-and-licence agreement was in a director's personal name. The auditor also said it had not received supporting documents for the Rs 0.51 lakh investment balance or agreements relating to loans and advances.

What is the proposed unsecured-loan conversion?

Amarnath Securities disclosed a proposed preferential issue of up to 5,00,000 fully paid equity shares of face value Rs 10 each in exchange for outstanding unsecured loans. The proposed conversion covers Rs 86.0591 lakh of liabilities owed to 14 proposed allottees and would be undertaken through conversion or set-off rather than for cash consideration.

The company said the object is to reduce outstanding loan liabilities and strengthen its capital structure. The lender-wise calculation uses a tentative issue price of Rs 21.70 per share, under which 3,96,586 shares would be issued and the proposed allottees would hold 11.68% after the issue. Amarnath Securities said the final issue price, number of shares, post-issue holdings and any change in control will be determined after the applicable process is completed.

Conclusion

Amarnath Securities' Rs 0.91 lakh half-year profit reflected Rs 21.87 lakh of other income against Rs 20.96 lakh of expenses, not operating revenue, which was nil versus Rs 19.04 lakh a year earlier. Negative equity of Rs 72.13 lakh, total liabilities of Rs 99.24 lakh and operating cash use of Rs 23.70 lakh provide the wider financial context for the reported profit.

The next disclosed developments are the pending RBI application or intimation following the management change and the proposed conversion of Rs 86.0591 lakh of unsecured loans into equity. The final preferential-issue price, shares allotted, post-issue holdings and the outcome of RBI approval were not disclosed in the filing.