Enclosed herein the Financial Results for the quarter ended 30 September 2025
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Dhatre Udyog reported a loss for the half-year ended September 2025. Standalone Profit Before Tax swung to a loss of about Rs. 97.27 lakhs in H1 FY26 from a profit of Rs. 122.90 lakhs in H1 FY25, and Profit After Tax turned negative at roughly Rs. (168) lakhs. Revenue from operations also declined sharply to around Rs. 912 lakhs in H1 FY26 from Rs. 1,442.93 lakhs in H1 FY25, a drop of roughly 37%. The fall reflects the company's earlier decision (Board meeting in February 2025) to shut down manufacturing at its Vizianagaram plant because the 30-year-old machinery was obsolete and uneconomical, and the unit has now disposed of plant and machinery as scrap. The company is monetising factory land and pivoting towards real estate development. It also booked a Rs. 130.42 lakh provision for expected credit loss on old trade receivables. Cash flows show Rs. 712.98 lakh inflow from sale of plant and Rs. 815.70 lakh outflow towards loan repayment in H1 FY26. Statutory Auditor P.D. Rungta & Co. issued a 'Qualified Conclusion' on both the standalone and consolidated results because trade receivables, advances and trade payables balances are pending confirmation and reconciliation. The associate, Hari Equipments Private Limited, had already seen a 100% investment impairment due to fully eroded net worth.
Shareholders should brace for continued weak operating earnings as manufacturing has been wound down, but the company is using asset-sale proceeds to clean up debt and fund a real estate pivot, which could re-rate the stock if execution goes well. The auditor's qualified opinion on balances pending confirmation is a yellow flag, and weak cash generation from operations (only Rs. 16.67 lakhs positive in H1 FY26) suggests limited cushion for new projects.