Dharani Sugars Reports Standalone Financial Results for March 2026; Highlights Show Losses and Significant Defaults
Dharani Sugars and Chemicals Limited has announced its standalone financial results for the quarter and year ended March 31, 2026. The company also announced key appointments for its audit and advisory services, while the accompanying auditor’s report noted material uncertainties regarding the company’s ability to continue as a going concern.Financial Performance Overview
The standalone financial statements provide a snapshot of the company's financial trajectory. Total equity for the period ended March 31, 2026, stood at a negative value of (Rs. 26,283.67) lakhs, compared to (Rs. 16,328.14) lakhs in the previous year.The company reported a Net Profit (Loss) for the period (standalone) of Rs. 110,472.07 lakhs.
According to the Statement of Cash Flows, Net cash from operating activities (A) for the year ended March 31, 2026, was Rs. 8,055.12 lakhs, compared to Rs. 603.09 lakhs in the year ended March 31, 2025.
Segment Revenue and Operations
The company has segmented its business into Sugar, Distillery, and Power. Segment-wise revenue results show the following performance:| Segment | Year ended March 31, 2026 (Audited) | Year ended March 31, 2025 (Audited) |
|---|---|---|
| Sugar | (Rs. 3,247.03) lakhs | (Rs. 3,791.24) lakhs |
| Distillery | (Rs. 862.80) lakhs | (Rs. 878.98) lakhs |
| Power | (Rs. 499.33) lakhs | (Rs. 508.68) lakhs |
| Total Loss | (Rs. 4,367.83) lakhs | (Rs. 5,707.38) lakhs |
Cash Flow Analysis
The Cash Flow Statement details the movements for the year.| Component | For the Year ended March 31, 2026 (Rs. Lakhs) | For the year ended March 31, 2025 (Rs. Lakhs) |
|---|---|---|
| Profit before income tax | (10,472.07) | (9,299.53) |
| Net cash from operating activities (A) | 8,055.12 | 603.09 |
| Net cash from used in investing activities (B) | 239.65 | 2.14 |
| Net cash from used in financing activities (C) | (8,301.89) | (626.88) |
| Net change in cash (A+B+C) | (7,121.12) | (21.65) |
| Cash and cash equivalents at end of the year | 13.50 | 20.62 |
Material Operational and Debt Concerns
The auditor’s report highlighted several material uncertainties that may cast significant doubt on the company's ability to continue as a going concern.Key issues raised include:
- CIRP Withdrawal and Default: The company entered into a Master Restructuring Agreement (MRA) dated May 24, 2024, with India Debt Resolution Company Limited (IDRCL) on behalf of National Asset Reconstruction Company Limited (NARCL). However, the company reportedly committed breaches of covenants, leading to the restructuring arrangement being cancelled.
- SDF Loan: The Sugar Development Fund (SDF) Loan was covered under a One Time Settlement (OTS) for Rs. 6,111 lakhs. The company defaulted in repayment within the extended timeline, and the OTS arrangement was consequently revoked, making the original liability payable.
- Ongoing Operations: The manufacturing facilities and major fixed assets have remained non-operational for a prolonged period.
The audit report also noted that the total outstanding amount from Directors and Related parties stands at Rs. 21,410.18 lakhs as of March 31, 2026.
Governance and Appointments
The Board of Directors held a meeting on May 16, 2026, where several corporate appointments and approvals were made:- Internal Auditor: M/s Srinivasan & Shankar Chartered Accountants, Chennai, was appointed as the Internal Auditor for the Financial year 2026-27.
- Cost Auditor: M/s SRR & Associates, Cost Accountants Chennai, was appointed as the Cost Auditor for the Financial year 2025-27.
- Secretarial Auditor: M Damodaran & Associates LLP was appointed as the Secretarial Auditor for the purpose of scrutinizing the e-voting conducted during the 39th Annual General Meeting.
- Director Re-appointment: Mrs. Visalakshi Periasamy was offered herself for re-appointment, subject to shareholder approval.
The company also decided to convene the 39th Annual General Meeting of its Members during the fourth week of September 2026.
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