Monitoring Agency report for the quarter ended June 30, 2025
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CARE Ratings, the Monitoring Agency, has filed its report for the quarter ended June 30, 2025 on the use of Rs. 149.99 crore raised through a preferential issue of Optionally Convertible Debentures (OCDs). Out of the total, Rs. 39.50 crore was utilised during the quarter, taking cumulative deployment to Rs. 148.39 crore (leaving only Rs. 1.60 crore unutilised, parked in liquid mutual funds). Of this, Rs. 22.65 crore was invested into a newly constituted Real Estate Platform SPV, routed through subsidiary Peninsula Holdings and Investments Pvt Ltd. The Monitoring Agency flagged a deviation of up to 10% — Rs. 13.25 crore was used directly for land purchase, vendor payments and earnest money deposits, which technically falls outside the stated object of investing into the real estate platform. The Company and the OCD investors, however, contend that this is not a deviation since the spending was for RE Platform projects and approved by JV partners.
Two important red flags for shareholders: (1) The Company reported a net loss of Rs. 5.03 crore in Q1 FY26, following a Rs. 36 crore loss in FY25, and (2) the stock price (Rs. 37.30 on Aug 11, 2025) is well below the OCD conversion price of Rs. 56.60, raising the risk that OCD holders may demand repayment rather than convert. Management attributes losses to timing of revenue recognition and expects future project launches to drive profitability.