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Epack Durable Ltd

| Quarterly Financial Results Q3 FY 2025–26

NEUTRAL SENTIMENT

Report Source

⬤20th Jan 26

Summary : EPACK Durable reported Q3 FY26 results, re-appointed directors, and is expanding capacity, but faces a qualified audit opinion due to disputed receivables.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Cost of materials consumed, purchases of stock-in-trade, change in inventories, employee benefits, finance costs, depreciation & amortisation, other expenses.
  2. Rs. 1,961 lakhs overdue from one customer.
  3. Consolidated Revenue from operations: Rs 42,775.34 lakhs for Q3 FY26.
  4. Standalone Revenue from operations: Rs 42,775.34 lakhs for Q3 FY26.
  5. Trade receivables include disputed balance of Rs. 1,961 lakhs.
  6. Unutilised IPO proceeds of Rs 8,360.69 lakhs, mostly in fixed deposits.
  7. Advanced additional loan to Epavo Electricals Private Limited (Joint Venture Company).
  8. Both standalone and consolidated financial results are presented and reviewed.
  9. Consolidated results include EPACK Durable Limited, EPACK Manufacturing Technologies Private Limited, Bumjin India Audio Products Private Limited, EPACK Electronic Components Private Limited, EPACK Durable Global Sales L.L.C.- FZ, and Epavo Electricals Private Limited (JV).

Corporate Overview

  1. Primarily operating in India.
  2. Disputed trade receivables of Rs. 1,961 lakhs from one customer.
  3. Business is seasonal in nature, affecting comparability of results.
  4. Significant trade receivables from one customer.
  5. Manufacturing of consumer durable products.
  6. Factual and procedural, announcing financial results and director re-appointments.
  7. One customer has significant overdue trade receivables.
  8. Operates in one reportable business segment.
  9. Funding capital expenditure for new manufacturing facilities in Bhiwadi, Rajasthan.
  10. Funding capital expenditure for new manufacturing facilities in Sricity, Andhra Pradesh.
  11. Purchase of equipment for the Bhiwadi manufacturing facility.

Risk Factors

  1. Significant disputed trade receivables.
  2. Qualified audit opinion on financials.
  3. Uncertain impact of new labor codes.
  4. Business is seasonal in nature.

Key Drivers

  1. New manufacturing facilities expansion.
  2. Key directors re-appointed, ensuring stability.
  3. Recovery of significant disputed receivables.
  4. Effective management of new labor codes.

Auditor’s Report

  1. Qualified Conclusion.
  2. Inability to determine adjustments for disputed trade receivables of Rs. 1,961 lakhs.
  3. Reliance on other auditors' reports for two subsidiaries and a joint venture.

Board Commentary

  1. Re-appointment of Mr. Bajrang Bothra as Whole Time Director for 5 years.
  2. Re-appointment of Ms. Priyanka Gulati as Independent Director for a second term of 3 years.
  3. Re-appointment of Mr. Krishnamachari Narasimhachari as Independent Director for a second term of 3 years.
  4. Re-appointment of Mr. Sameer Bhargava as Independent Director for a second term of 3 years.
  5. Re-appointment of Mr. Shashank Agarwal as Independent Director for a second term of 3 years.
  6. Disputed trade receivables of Rs. 1,961 lakhs from one customer.
  7. Criminal complaint filed against a customer for overdue receivables.
  8. Utilisation of IPO proceeds for capital expenditure on manufacturing facilities.
  9. Advanced an additional loan of Rs 350 lakhs to Epavo Electricals Private Limited, totaling Rs 2,378 lakhs.

Corporate Governance

  1. Four Independent Directors re-appointed for second terms.
  2. Nomination and Remuneration Committee recommended director re-appointments.
  3. Audit Committee reviewed financial results.
  4. Qualified audit opinion due to disputed receivables.

Management Discussion & Analysis

Future Strategy

  1. Monitoring finalization of Central/State Rules and clarifications for new Labour Codes.

Macroeconomic Outlook

  1. Impact of new Labour Codes (Code on Wages, Industrial Relations, Social Security, Occupational Safety, Health and Working Conditions) on employee benefits expense.

Operational Focus Areas

  1. Recovery of disputed trade receivables from a customer.

Performance Drivers

  1. Business is seasonal in nature.

Risk Control Measures

  1. Company believes in high probability of recovery for disputed receivables.
  2. Monitoring Labour Code rules for appropriate accounting effect.

Critical Risks

  1. Disputed trade receivables of Rs. 1,961 lakhs from one customer.
  2. Uncertain financial impact of new Labour Codes.
  3. Seasonal nature of the business.
Epack Durable Ltd (EPACK) Quarterly Report Analysis & Insights | Dhanarthi