Statement of Audit Qualification on the Consolidated Financial Results for the quarter and year ended 31st March, 2025

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Price reactionminutes from the announcement price · days from the prior close

-2.6%Reaction day

₹3.49

prior close

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announcement price

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Nifty Microcap 250market · in no size index; the smallest one is used+0.5%-3.1% vs market

Ferro & Silica Manganese peers, median of 6sector-1.1%-1.5% vs sector

On the reaction day the stock moved 3.1 pts less than Nifty Microcap 250 and 1.5 pts less than its Ferro & Silica Manganese peers, over the same two closes: a difference in percentage points, not a measure of what the filing did.

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AI summary

The statutory auditor has issued a Disclaimer of Opinion (the most severe type of audit qualification) on Facor Alloys' consolidated financial results for FY25, because the company excluded its overseas subsidiary from consolidation due to non-availability of reliable financial data after a management change. The auditor said it could not determine what adjustments would have been needed had the subsidiary been consolidated, and therefore did not express any opinion on the numbers. Management stated that based on legal advice the impact of non-consolidation is not material and has also filed a complaint with the Economic Offences Wing. On the reported figures, the company posted total income of Rs. 1,058.3 lakhs against total expenditure of Rs. 1,675.57 lakhs, resulting in a massive net loss of Rs. 5,021.43 lakhs and an EPS of -2.57, while net worth stood at Rs. 10,037.09 lakhs. The qualification has appeared for the first time, and the auditor has not quantified the impact.

Likely market impact

A Disclaimer of Opinion is a serious red flag, indicating the auditor could not verify the reliability of key portions of the financials, which may erode investor confidence and weigh on the stock. Combined with a net loss nearly 5 times the annual revenue, shareholders should view this as a significant governance and going-concern concern.