Chrome Silicon to Sell Rudraram Unit, Suspends Ferro Alloys Operations

Chrome Silicon Ltd announced plans to sell its entire manufacturing undertaking at Rudraram, including plant and machinery, following the suspension of its Ferro Alloys operations since May 30, 2025. The company reported a net loss of ₹9.84 crore for the financial year ended March 31, 2026, a significant improvement from the ₹85.94 crore loss in the previous year.

Reader Takeaway: Ceasing manufacturing and selling the unit; narrowed annual loss, but qualified audit raises accuracy concerns.

What just happened

The company has decided to permanently cease Ferro Alloys manufacturing at its Rudraram unit due to high power costs, outdated technology, and market volatility. Following this, the Board has approved the sale of the plant, machinery, and equipment of this unit, which constitutes 100% of the company's undertaking. This sale process is expected to conclude by October 31, 2026, with proceeds earmarked for debt repayment and working capital.

Why this matters

This move marks a significant strategic shift for Chrome Silicon, as it signals the end of its core manufacturing activities. The sale of the entire undertaking requires shareholder approval via a postal ballot. While the reported net loss for FY26 has decreased, this is attributed to reduced operational scale rather than improved underlying profitability. The proceeds from the sale will be crucial for managing the company's debt and funding its working capital needs.

The backstory

Chrome Silicon's Ferro Alloys manufacturing operations have been suspended since May 30, 2025. The decision to not restart these operations was based on an independent evaluation deeming it not viable. The company's total income from operations saw a substantial drop to ₹10.57 crore in FY26 from ₹76.49 crore in FY25.

What changes now

If shareholder approval is obtained, the company will divest its entire manufacturing base. This will fundamentally alter its operational structure, moving away from manufacturing towards managing the sale proceeds for debt and working capital. The basic EPS for FY26 stood at ₹(6.00), compared to ₹(53.78) in FY25.

Risks to watch

The statutory auditor has issued a qualified opinion on the FY26 financial results. Key concerns include non-compliance with Ind AS standards (Property, Plant, and Equipment; Employee Benefits; Financial Instruments), lack of physical verification for assets and inventory, and material uncertainty regarding the recoverability of interest-free loans and advances. Confirmation of outstanding balances for suppliers and trade payables is also an issue.

Peer comparison

Information on specific peers in the Ferro Alloys manufacturing sector undergoing similar divestments or facing similar operational challenges is not provided in the filing.

Context metrics (time-bound)

• FY26 Total Income: ₹10.57 crore
• FY25 Total Income: ₹76.49 crore
• FY26 Net Loss: ₹(9.84) crore
• FY25 Net Loss: ₹(85.94) crore
• FY26 Total Assets: ₹229.95 crore
• FY25 Total Assets: ₹235.98 crore
• Operations Suspended Since: 30.05.2025
• Proposed Sale Completion: 31.10.2026

What to track next

Investors should closely monitor the outcome of the postal ballot for shareholder approval of the asset sale. Additionally, the company's ability to manage its debt and working capital with the sale proceeds, and any future strategic direction post-divestment, will be key factors to watch.