Cambridge Technology books Rs 3.0118 crore subsidiary sale loss

Cambridge Technology Enterprises Limited recorded a Rs 3.0118 crore consolidated exceptional loss in the half year ended September 30, 2026 after selling RP Web Apps Private Limited on April 6, 2026 for Rs 6.088 lakh, although the subsidiary had audited standalone net worth of Rs 3.072676 crore at March 31, 2026.

Why did Cambridge Technology report a loss on RP Web Apps?

Cambridge Technology sold its entire investment in RP Web Apps during the quarter ended June 30, 2026, ending control of the wholly owned subsidiary on April 6, 2026. The consideration was Rs 6.088 lakh, equal to the face value of the equity shares and determined pursuant to a valuation report, according to the auditor's review report.

The consideration was below RP Web Apps' audited standalone net worth of Rs 3.072676 crore at March 31, 2026. The auditor specifically highlighted that the net worth exceeded the sale consideration, while stating that its review conclusion on the September 2026 results was not modified.

Cambridge Technology recorded a Rs 2.92224 crore loss on the sale in its standalone results for the half year ended September 30, 2026. The company classified that charge as an exceptional item because of the transaction's size and non-recurring nature, while the standalone results table presents the exceptional item as Rs 2.9222 crore.

At the consolidated level, the loss on disposal and cessation of control was Rs 3.011796 crore, or Rs 3.0118 crore in the consolidated results table. The difference from the standalone loss arose in the accounting for loss of control and consolidation of RP Web Apps under Indian Accounting Standard 110, or Ind AS 110, which covers consolidated financial statements.

How did Cambridge Technology correct the consolidated accounting?

Cambridge Technology said the Rs 3.0118 crore loss from losing control of RP Web Apps was inadvertently adjusted directly against equity and reserves in the consolidated financial results for the quarter ended June 30, 2026. The company subsequently recognised the amount as an exceptional item in the consolidated statement of profit and loss.

The June 30, 2026 consolidated comparative figures included in the September half-year statement were restated as a result. The consolidated income statement shows a Rs 3.0118 crore exceptional item for the June quarter, no exceptional item for the September quarter, and the same Rs 3.0118 crore charge for the six months ended September 30, 2026.

Cambridge Technology said consolidation adjustments from derecognising RP Web Apps' net assets and related balances continued to be recognised directly in equity and reserves, in accordance with Ind AS 110. This means the exceptional item reflects the loss on cessation of control, while other derecognition adjustments retained their treatment in reserves.

The consolidated auditor identified the correction as an other matter and noted the restatement of the June 2026 quarter. Its conclusion on the half-year consolidated financial results remained unmodified, as did the standalone auditor's conclusion on the Rs 2.92224 crore loss.

What was the effect on Cambridge Technology’s half-year results?

Cambridge Technology reported consolidated profit before tax of Rs 9.8308 crore for the half year ended September 30, 2026 after the Rs 3.0118 crore exceptional item. Before the exceptional charge, consolidated profit before tax was Rs 12.8426 crore, compared with a loss before tax before exceptional items of Rs 3.9879 crore in the corresponding half year of 2025.

Consolidated revenue from operations declined to Rs 93.2991 crore in the September 2026 half year from Rs 94.3705 crore a year earlier. Despite the Rs 1.0714 crore revenue decrease and the sale-related charge, the group reported profit after tax of Rs 8.8315 crore, against a loss after tax of Rs 4.6171 crore in the prior-year half year.

On a standalone basis, Cambridge Technology reported profit before tax of Rs 0.6391 crore for the September 2026 half year after the Rs 2.9222 crore exceptional item. Before the charge, standalone profit before tax was Rs 3.5613 crore, compared with Rs 2.1428 crore in the half year ended September 30, 2025.

The September 2026 consolidated quarter itself reported profit before tax of Rs 5.2188 crore, with no exceptional item recorded in that three-month period. The Rs 3.0118 crore charge instead sits in the restated June 2026 quarter, which reported profit before tax of Rs 4.6120 crore after the exceptional item.

What else did the auditor identify in the September results?

Cambridge Technology's standalone auditor drew attention to management's statement that investments in subsidiaries had realisable value not lower than their carrying value at September 30, 2026. Management also said downstream investments, where applicable, were expected to carry valuations that would not reduce the stated value of Cambridge Technology's investments.

The consolidated auditor noted that the group's non-current investments were carried at cost less impairment and that management considered them to carry the values stated in the half-year results. The auditor did not modify its conclusion in relation to this matter or the RP Web Apps disposal.

Six subsidiaries had interim financial results that were not reviewed by their auditors, according to the consolidated review report. Those entities had combined assets of Rs 41.1272 crore at September 30, 2026, half-year revenue of Rs 0.3967 crore and a half-year loss after tax of Rs 0.0437 crore; management certified the results and said they were not material to the group.

RP Web Apps was included in the consolidated results only until its April 6, 2026 disposal date. Cambridge Technology reported one operating segment under Ind AS 108, meaning the disclosed half-year financial outcome does not provide separate operating revenue or profit information for RP Web Apps.

What is Cambridge Technology planning with FA Software?

Cambridge Technology's board approved the disinvestment of its entire holding in FA Software Services Private Limited, comprising 10,000 equity shares with face value of Rs 10 each. FA Software will cease to be a wholly owned subsidiary once the share transfer is completed, but the filing did not state a completion date or consideration for that sale.

Separately, Cambridge Technology completed the assignment of a Rs 15.222576 crore loan receivable from FA Software to Aglow Financial Services Private Limited on November 12, 2026. The company received Rs 40 lakh for the assignment, while the right to accrued interest was excluded and remained with Cambridge Technology.

The member approval for the loan assignment was granted through a special resolution on September 29, 2026. Cambridge Technology stated that Aglow was not part of its promoter group or group companies, and that the assignment was not a related-party transaction.

Conclusion

The RP Web Apps disposal created a Rs 3.0118 crore consolidated exceptional loss for Cambridge Technology even though the subsidiary had Rs 3.072676 crore of audited standalone net worth at March 31, 2026. The transaction was completed for Rs 6.088 lakh, and the company subsequently moved the loss from equity and reserves into the consolidated profit and loss statement through a restatement of the June 2026 comparative figures.

Next, readers should watch for completion terms for the approved sale of FA Software's 10,000 shares, including the consideration and any resulting accounting effect. Cambridge Technology has also completed the Rs 40 lakh assignment of its Rs 15.222576 crore FA Software loan receivable, while retaining the right to interest that had accrued on that debt.