Outcome of the Meeting of Board of Director held on 29th May, 2025 and submission of Audited Financial Results for the Quarter and year ended 31st March, 2025
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SPA Capital Services Limited's board approved audited financial results for FY25 and Q4 FY25. Total income rose to Rs. 32.94 crore from Rs. 21.08 crore in FY24, a growth of about 56%. Reported net profit for the year stood at Rs. 0.49 crore versus Rs. 0.38 crore last year, with basic EPS of Rs. 1.61. Q4 FY25 revenue jumped to Rs. 14.01 crore from Rs. 6.12 crore in Q4 FY24. However, statutory auditors M/s DHANA & Associates issued a qualified opinion flagging two recurring issues: non-provision of interest of Rs. 7.75 lakh on certain loans (departure from accrual basis) and non-provisioning of Rs. 3.14 crore for loans classified as loss assets under RBI NBFC guidelines due to non-charging of interest. If adjusted, the company would have posted a net loss of Rs. 3.42 crore instead of a profit. The auditor's qualified opinion has now been given for the fifth consecutive time. Operating cash flow turned negative at Rs. -2.76 crore compared to a positive Rs. 3.27 crore last year.
The headline profit and revenue growth look attractive but are misleading. Adjusted for audit qualifications, the company actually made a loss for the fifth straight year, and operating cash turned negative. Persistent weak internal controls around loan provisioning and non-accrual of interest raise concerns about asset quality and earnings credibility, likely weighing on investor confidence.