Leading Leasing Finance Returns to Profit Amid Auditor Red Flags

Net Profit: Rs 1.44 crore | Revenue: Rs 18.45 crore

Reader Takeaway: Turnaround to profitability is clouded by serious auditor remarks on unpaid taxes and unverifiable business assets.

What just happened

Leading Leasing Finance and Investment Company Ltd has reported a net profit of Rs 1.44 crore for the quarter ended September 30, 2026. This marks a significant swing from the Rs 20.36 crore loss reported in the June 2026 quarter. However, revenue from operations dropped to Rs 18.45 crore compared to Rs 120.13 crore in the preceding quarter.

Why this matters

While the company has moved back into the black, the statutory auditor, S K Bhavsar & Co., has issued an 'Emphasis of Matter' that casts doubt on the company's financial reliability. The auditor cited a failure to deposit Rs 1.96 crore in Tax Deducted at Source (TDS) for the current financial year and a lack of interest provisions on these unpaid dues.

Auditor Concerns

Beyond tax issues, the auditors flagged severe operational transparency concerns:

• The firm could not verify the existence or recoverability of loans and advances given, nor the unsecured loans taken.
• Sales and purchases of shares and securities could not be reconciled against broker ledgers or contract notes.
• The auditor noted that the total financial impact of these discrepancies is currently impossible to determine.

Context Metrics

Compared to the same quarter last year (September 2025), the company’s profit has seen a minor dip from Rs 1.70 crore to Rs 1.44 crore, while revenue showed growth from Rs 11.09 crore to Rs 18.45 crore. The Basic EPS for the current quarter stands at Rs 0.03.

What to track next

Investors should closely watch management’s response to the auditor's remarks and any subsequent updates regarding the reconciliation of the outstanding tax liabilities and the verification of lending and trading data.