Result of Board Meeting dated 13 August 2025
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Artefact Projects reported Q1 FY26 revenue from operations of Rs. 312.48 lakhs, down sharply from Rs. 3,004.62 lakhs in Q1 FY25, a roughly 90% year-on-year decline. Net profit stood at Rs. 101.81 lakhs versus Rs. 297.58 lakhs in the same quarter last year, with EPS at Rs. 1.40. The company changed its revenue recognition policy this quarter to bill only on client approval and acceptance, which reduced reported sales by Rs. 448.05 lakhs and profits by Rs. 96.78 lakhs, with Rs. 351.27 lakhs moved into work-in-progress. The auditor issued an unmodified opinion with an Emphasis of Matter on the new accounting policy and on the carrying value of a Rs. 16 lakhs investment in Akola Urban Co-operative Bank. The Board also approved a Rs. 60 crore capital expenditure plan, an increase in authorized capital from Rs. 10 crore to Rs. 15 crore, and a Rs. 31 crore purchase of office premises from related parties (a director's relative and a promoter).
The sharp revenue drop is largely accounting-driven due to the new billing policy rather than a business collapse, but reported earnings and topline visibility look weak on paper for the quarter. Shareholders should note the sizable related-party property purchase worth over half of annual turnover, which needs member approval at the AGM. The capex and authorized capital hike signal growth intent, but execution and conversion of the healthy order book into billed revenue will be the key things to watch.