Indowind review says September profit may fall Rs 86.96 lakh

Indowind Energy Limited’s reviewer said profit for the quarter ended September 30, 2026 would have been Rs 86.96 lakh lower if Suzlon operation and maintenance charges had been expensed rather than transferred to an advance account. The limited review also questioned a compensation receivable of Rs 8.4559 crore and goodwill of Rs 74.5469 crore.

Why would Indowind’s September-quarter profit be Rs 86.96 lakh lower?

Indowind’s September-quarter profit would have been Rs 86.96 lakh lower because operation and maintenance charges invoiced by Suzlon were moved to an advance account instead of being charged to the statement of profit and loss. Venkatesh & Co identified Rs 86.96 lakh as relating to the quarter ended September 30, 2026, in its limited review dated November 5, 2026.

The quarterly amount was part of Rs 1.7393 crore of Suzlon operation and maintenance charges transferred to the advance account during the half year ended September 30, 2026. The reviewer said half-year profit would have been lower by Rs 1.7393 crore had the advance and the charges been expensed and the receivable appropriately amortised.

The reviewer also said Rs 14.9436 crore paid to Suzlon Energy Ltd. had been recorded as an advance in earlier years without adequate audit evidence rather than being expensed. It concluded that the accounting treatment departed from the relevant Indian Accounting Standards, known as Ind AS, and affected Indowind’s unaudited standalone statement.

Which Suzlon balances did Indowind’s reviewer question?

Indowind’s reviewer questioned an arbitration claim of Rs 90.8339 crore, an advance of Rs 14.9436 crore and a compensation receivable of Rs 8.4559 crore involving Suzlon. The arbitration claim was filed against the Suzlon Group in earlier years, while the advance was paid to Suzlon Energy Ltd., according to the review report.

The Rs 8.4559 crore compensation receivable was recognised without counterparty confirmation or measurement under Ind AS 109, the reviewer said. The remaining balance of the Rs 90.8339 crore arbitration claim was not recognised, meaning the filing distinguishes between the recorded receivable and the larger claim that remains outside the financial statements.

The review stated that profit and loss account balances under reserves and surplus would have been lower by Rs 16.6829 crore and Rs 8.4559 crore under the specified accounting treatment. These are the reviewer’s stated effects of expensing the advance and charges and appropriately amortising the receivable, rather than revised results issued by Indowind.

What did Indowind say about the Suzlon-operated project?

Indowind said Suzlon Energy Ltd., the operation and maintenance operator for its 18 megawatt project, did not ensure machine availability during the period ended September 30, 2026. Management said it was pursuing compensation through discussions and legal recourse.

Management said revenue and profit would have been higher by close to Rs 5 crore had the machines operated normally, and said Suzlon had promised normalisation soon. The filing gives no date for normalisation, agreed compensation amount or outcome from discussions and legal action.

The company’s operational statement and the reviewer’s accounting qualification concern related Suzlon matters but make different points. Management described reduced availability at the 18 megawatt project, while the reviewer said the Rs 8.4559 crore receivable lacked confirmation and Ind AS 109 measurement.

What other accounting issue did the Indowind review identify?

The review identified the absence of an impairment assessment for Rs 74.5469 crore of goodwill as at September 30, 2026. The goodwill was transferred following the merger of Ind Eco Ventures Limited with Indowind, a business combination under common control.

Venkatesh & Co said it could not determine whether an impairment loss was required or what consequential effect it could have on the accompanying statement. Unlike the Rs 86.96 lakh quarterly effect associated with the Suzlon charges, the review did not quantify a possible profit adjustment for goodwill.

Goodwill was unchanged at Rs 74.5469 crore at September 30, 2026 and March 31, 2026. Over the same dates, total assets increased to Rs 358.1517 crore from Rs 347.8641 crore, while capital work in progress rose to Rs 20.7305 crore from Rs 12.3051 crore.

How did Indowind’s financial position change by September 2026?

Indowind’s cash and cash equivalents fell to Rs 1.3204 crore at September 30, 2026 from Rs 8.539 crore at March 31, 2026. The six-month cash-flow statement reported a net decrease of Rs 7.2186 crore, following operating cash outflow of Rs 14.9877 crore, investing cash inflow of Rs 2.9264 crore and financing cash inflow of Rs 4.8427 crore.

The operating cash movement included increases in other financial assets of Rs 17.2148 crore, trade receivables of Rs 5.1012 crore and loans and advances of Rs 3.1397 crore. The source compares the six months ended September 30, 2026 with the year ended March 31, 2026, when operating activities generated Rs 2.9024 crore of net cash.

Short-term borrowings increased to Rs 4.4183 crore at September 30 from Rs 23.48 lakh at March 31. Current assets rose to Rs 44.462 crore from Rs 41.7148 crore, as other current financial assets increased to Rs 26.4122 crore from Rs 11.1683 crore, while bank balances other than cash and cash equivalents declined to Rs 1.7658 crore from Rs 12.8369 crore.

Management also disclosed a 4 megawatt solar project under completion, whose expected income is likely to enhance future profits. The notes additionally reported a non-recurring Rs 80 lakh fee for increasing authorised capital, but did not disclose the solar project’s completion date, expected revenue or commissioning schedule.

Conclusion

The limited review sets out a defined accounting effect on Indowind’s September-quarter profit of Rs 86.96 lakh and on half-year profit of Rs 1.7393 crore, arising from Suzlon operation and maintenance charges moved into an advance account. It also raises unresolved accounting matters involving the Rs 14.9436 crore advance, Rs 8.4559 crore compensation receivable and Rs 74.5469 crore of goodwill.

Next, investors can watch for progress in Indowind’s stated discussions and legal recourse concerning the 18 megawatt project, including whether machine availability normalises. The filing also leaves open whether Suzlon confirms the compensation receivable, whether goodwill requires impairment, and when the 4 megawatt solar project under completion begins generating income.