Unaudited Standalone and Consolidated Financial Results for the Quarter and Half year ended September 30, 2025
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Covance Softsol Limited submitted its unaudited standalone and consolidated financial results for Q2 FY26 and the half year ended September 30, 2025, along with a Limited Review Report from auditor Pavuluri & Co. On a standalone basis, profit before tax for H1 FY26 jumped sharply to about ₹2,081 lakhs versus ₹174 lakhs in H1 FY25, driven largely by other income, while on a consolidated basis H1 PBT was about ₹2,022 lakhs versus ₹1,356 lakhs. Operating cash flows were negative on both bases — standalone H1 net cash from operations was around ₹(527) lakhs and consolidated was around ₹(1,351) lakhs, compared with a positive ₹223 lakhs in the prior year period, signalling weak cash conversion despite strong reported profits. The Board also dissolved the Rights Issue Committee (formed August 14, 2025) and noted the resignation of Director Mr. Bhaskar Rao Madala effective October 25, 2025. Equity was raised via share issuance of about ₹738 lakhs during the period.
The headline profit growth looks impressive, but negative operating cash flows on both standalone and consolidated books suggest profits are not converting into cash, which is a red flag for shareholders. The exit of a director and the dissolution of the recently formed Rights Issue Committee add governance uncertainty worth monitoring for the stock.