Oswal Agro Mills reports a sharp decline in FY25-26 performance, with profit after tax falling to Rs 8.62 crore from Rs 108.82 crore. The results are further pressured by critical auditor qualifications regarding unconfirmed real-estate advances and inter-corporate deposits totaling Rs 1,226.77 crore. Investors must monitor the company’s ongoing legal disputes and asset recoverability issues.
Oswal Agro Mills FY26 Financials: Profits Plummet Under Audit Scrutiny
Profit After Tax (PAT) declined to Rs 8.62 crore from Rs 108.82 crore; Auditor qualifications cite Rs 1,226.77 crore in unconfirmed assets.
Reader Takeaway: Weak operational results compounded by significant auditor concerns over asset recovery and ongoing legal arbitration disputes.
What just happened
Oswal Agro Mills released its FY25-26 financial results, revealing a steep downturn in core profitability. Consolidated revenue dropped to Rs 37.57 crore compared to Rs 173.68 crore in the previous fiscal year. Most notably, the company reported a consolidated loss of Rs 22.03 crore when accounting for the share of associates, down from a profit of Rs 112.84 crore in FY24-25.
Why this matters
The statutory auditors have issued a qualified opinion, flagging two major issues. First, an arbitration dispute regarding interest on Inter-Corporate Deposits (ICDs) has led to an alleged understatement of PAT by Rs 20.87 crore. Second, auditors were unable to verify the recoverability of Rs 1,226.77 crore in ICDs and real estate advances, as no confirmations were received from counterparties.
Management and Corporate Changes
The board has appointed M/s. BGMG & Associates as statutory auditors. Additionally, Mr. Shael Oswal has been proposed as Managing Director for a three-year term at Rs 12.50 lakh per month. This appointment is currently subject to Central Government approval due to non-compliance with residency requirements under the Companies Act, 2013.
Risks to watch
Investors should closely track the ongoing legal battle in the Delhi High Court regarding the arbitration award. Furthermore, the lack of confirmation on massive inter-corporate deposits and real estate advances poses a direct risk to the company's asset valuation and liquidity. The ability of the management to secure regulatory approval for the MD appointment is another key uncertainty.
What to track next
Watch for the completion of the land transfer process to the Brihanmumbai Municipal Corporation, slated for March 2027. Additionally, shareholder meetings will be critical to observe the formal approval of the new auditor’s 5-year term.