SVC Industries half-year loss widens to Rs 159.31 lakh

SVC Industries Limited reported a Rs 159.31 lakh loss for the half year ended 30 September 2026, compared with a Rs 1.24 crore loss a year earlier, after total income fell to Rs 12.76 lakh from Rs 4.67 crore and agri-product sales declined to Rs 10,000 from Rs 4.23 crore.

Why did SVC Industries’ half-year income fall?

SVC Industries’ income fell primarily because agri-product sales nearly ceased in the half year ended 30 September 2026. Agri-product sales were Rs 10,000, against Rs 4.23 crore in the corresponding half year ended 30 September 2025. The company identifies trading and warehousing of agri products as its sole operating segment under Indian Accounting Standard 108, or Ind AS 108.

Lease rent income also declined, to Rs 12.33 lakh from Rs 43.37 lakh a year earlier. Other income was Rs 33,000, compared with Rs 56,000 in the prior-year half. These three income lines resulted in total income of Rs 12.76 lakh, a decline from Rs 4.67 crore in the six months ended 30 September 2025.

The September quarter continued to show limited revenue. Total income was Rs 5.52 lakh for the quarter ended 30 September 2026, compared with Rs 2.02 crore in the September 2025 quarter and Rs 7.24 lakh in the preceding June 2026 quarter. September-quarter agri-product sales were Rs 10,000, while lease rent income was Rs 5.37 lakh.

The composition of income changed sharply from the previous year. In the half year ended 30 September 2025, agri-product sales of Rs 4.23 crore accounted for most of the Rs 4.67 crore total income, with lease rent contributing Rs 43.37 lakh. In the latest half year, lease rent of Rs 12.33 lakh provided almost all income because product sales were negligible.

How did SVC Industries’ expenses and loss change?

SVC Industries’ loss before tax widened to Rs 159.31 lakh for the half year ended 30 September 2026 from Rs 1.24 crore a year earlier. The loss for the period was also Rs 159.31 lakh because the statement reported no tax expense. Basic and diluted loss per share was Rs 0.10, compared with Rs 0.08 in the previous-year half.

Total expenses declined to Rs 1.72 crore from Rs 5.81 crore, but income declined by a larger amount. Purchases of stock in trade fell to Rs 18,000 from Rs 3.49 crore, while changes in inventory were nil compared with Rs 48.10 lakh in the prior-year period. The fall in these costs corresponded with the reduction in agri-product sales.

Depreciation was unchanged at Rs 96.31 lakh in both half-year periods. Employee benefits expense declined to Rs 23.63 lakh from Rs 28.17 lakh, and administrative and other expenses declined to Rs 51.95 lakh from Rs 54.44 lakh. Finance cost was nil in the latest half year, compared with Rs 7.86 lakh in the half year ended 30 September 2025.

The quarterly loss widened sequentially in the September quarter. Loss before tax was Rs 97.90 lakh for the quarter ended 30 September 2026, versus Rs 61.41 lakh in the June 2026 quarter and Rs 54.02 lakh in the September 2025 quarter. Administrative and other expenses rose to Rs 42.48 lakh from Rs 9.47 lakh in the preceding quarter, while depreciation was Rs 48.10 lakh.

What happened to SVC Industries’ cash, assets and borrowings?

SVC Industries used Rs 86.49 lakh in operating activities during the half year ended 30 September 2026, compared with Rs 17.32 lakh generated from operations a year earlier. Its Rs 159.31 lakh loss before tax was partly offset by Rs 96.31 lakh of depreciation, producing an operating loss before working-capital changes of Rs 63 lakh.

Financing activities generated Rs 1.27 crore of cash, against an outflow of Rs 13.63 lakh in the prior-year half. The latest financing flows included Rs 9 crore of proceeds from unsecured loans from others, Rs 5 crore of repayments of secured loans from financial institutions and Rs 2.68 crore of repayments of secured loans from related parties. Cash and cash equivalents increased to Rs 40.56 lakh at 30 September 2026 from Rs 23,000 at 31 March 2026.

Total assets were Rs 441.59 crore at 30 September 2026, compared with Rs 441.99 crore at 31 March 2026. Property, plant and equipment decreased to Rs 420.13 crore from Rs 421.10 crore, while current assets rose to Rs 81.41 lakh from Rs 28.08 lakh. Trade receivables were Rs 1.21 crore at 30 September 2026, compared with Rs 2.27 crore at 31 March 2026.

Total equity declined to Rs 263.87 crore at 30 September 2026 from Rs 265.47 crore at 31 March 2026, reflecting the half-year loss. Non-current borrowings increased to Rs 176.72 crore from Rs 175.45 crore. Current liabilities declined to Rs 78.05 lakh from Rs 85.30 lakh over the same period.

What qualification and settlement issues did SVC Industries disclose?

SVC Industries’ limited-review report carried a qualified conclusion over Rs 9 crore recorded as an unsecured loan or inter-corporate deposit. Auditor B. M. Chaturvedi & Co. said it had not been provided supporting documents for the amount’s nature and terms. It therefore could not verify its nature, accounting treatment, classification or whether adjustments were required.

SVC Industries said its board approved the Rs 9 crore unsecured loan or inter-corporate deposit on 13 November 2026. The auditor’s report, also dated 13 November 2026, stated that, except for the possible effects of that matter, nothing had come to its attention to indicate a material misstatement in the results. The engagement was a limited review rather than an audit.

SVC Industries is negotiating settlements with outstanding debenture holders and said it cannot reliably estimate the ultimate payment. It has not made a provision for additional interest and other charges that could be payable to lenders under Indian Accounting Standard 37, or Ind AS 37, because it said a reliable estimate cannot be made.

The company also disclosed a one-time settlement with Pradeshiya Industrial & Investment Corporation of U.P. Limited, or PICUP. The settlement dated 4 December 2023 covered dues of Rs 25.97 crore, and PICUP had extended the deadline to 30 September 2026 for a Rs 19.48 crore final instalment plus 12% simple interest for the default period. SVC Industries said it paid a further Rs 5 crore during the September 2026 quarter and requested another extension while seeking an interest rebate.

Conclusion

SVC Industries’ half-year results reflect the disappearance of agri-product sales, which fell from Rs 4.23 crore to Rs 10,000 and reduced total income to Rs 12.76 lakh. Lower stock purchases and inventory costs reduced expenses to Rs 1.72 crore, but recurring depreciation of Rs 96.31 lakh and administrative costs of Rs 51.95 lakh contributed to the wider Rs 159.31 lakh loss.

The disclosed matters to watch next are PICUP’s response to the company’s request for a further extension after the 30 September 2026 deadline, the eventual settlement amounts for debenture and lender obligations, and supporting documentation for the Rs 9 crore unsecured loan or inter-corporate deposit identified in the auditor’s qualified conclusion.