Hariyana Ship Breakers Ltd Reaffirms Unqualified Audit Opinion Amid Financial Disclosures

Hariyana Ship Breakers Ltd Reaffirms Unqualified Audit Opinion Amid Financial Disclosures​

Hariyana Ship Breakers Ltd has confirmed that its financial results for the year ended March 31, 2026, carry an unmodified opinion from the Statutory Auditors, addressing initial concerns regarding a qualification. The company released clarifications confirming that references to "Basis of Qualified Opinion" found in the audit report were inadvertent typographical errors and should read as "Basis for Opinion."

The Independent Auditor's Report on Standalone and Consolidated financial results confirmed that the reports issued are unqualified in nature and do not contain any adverse opinion or disclaimer.

Key Observations from Audit Reports​

The audited statements highlight several significant operational and financial aspects of the company and its associated group entities:

Finances and Investments:
The holding company's capital contribution stands at Rs 140.36 Crores, accounting for 90.40% of the total assets. The Group has investments in a subsidiary firm dealing in oxygen gases, alongside five partnership firms focused on real estate development.

One partnership firm, into which the Group contributed Rs 133.63 crores, utilized Rs 126.11 crores of those contributions to grant loans to body corporates and other partnership firms. Given the scale of these assets, the recoverability of such advances carries a potentially significant impact on the Group’s financial standing.

Inventory and Provisions:
The management reported that certain inventories had deteriorated and were written down below cost to their estimated net realizable value. Consequently, the company recognized an inventory write-down amounting to 80.61 Lakhs during the financial year ended March 31, 2026.

Regarding non-current financial assets, a provision of 1,319.00 Lakhs was made by the management concerning Loans and Advances related to a proposed joint venture. The reported losses for the financial year include the effect of this provision.

Group and Banking Status:
The company previously had availed an overdraft facility from Punjab National Bank; however, reports confirm that this facility was fully repaid during the year ended March 31, 2026, with no outstanding amount as of the balance sheet date.

Clarification on Financial Results​

The clarification addressed a query regarding the opinion in the Independent Auditor's Report for both standalone and consolidated results for the quarter and year ending March 31, 2026. The company confirmed that the reference to "Basis for Qualified Opinion" was solely a clerical oversight, with the actual audit opinions being clean.

The comprehensive audit reports included an Emphasis of Matter related to a joint venture advance of Rs 1.21 crores, which the group accepted in the financial year 2017-18 from one private limited company. As yet, neither the intended joint venture has commenced nor has the advanced amount been repaid to the party.

The audit procedures examined the management’s assessment regarding the recoverability of both the advances and inventory losses, emphasizing that the carrying value of inventories remains subject to physical verification upon completion.

Stock Price Movement​

As of 12:05, Hariyana Ship Breakers Ltd. is edging higher at ₹99.65 after climbing +5.95% in trading. The shares traded within a solid range today, moving between a low of ₹96.00 and an intraday high of ₹99.85.