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Gayatri Projects Ltd

| Q2 Results – Standalone & Consolidated 30-09-2025

NEUTRAL SENTIMENT

Report Source

⬤30th Sep 25

Summary : Gayatri Projects Limited exited CIRP after debt settlement, but faces significant contingent liabilities and challenges in recovering long-pending dues.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Cost of Materials Consumed & Work Expenditure: Standalone 14,161.38 Lakhs, Consolidated 14,161.38 Lakhs.
  2. Employee Benefits Expense: Standalone 1,144.67 Lakhs, Consolidated 1,144.67 Lakhs.
  3. Finance Costs: Standalone 1,109.51 Lakhs, Consolidated 1,149.55 Lakhs.
  4. Depreciation and Amortization Expense: Standalone 1,738.49 Lakhs, Consolidated 1,738.49 Lakhs.
  5. Other Expenses: Standalone 1,282.29 Lakhs, Consolidated 1,282.30 Lakhs.
  6. Delayed recovery of Trade Receivables from various parties.
  7. Revenue from operations: Standalone 14,971.00 Lakhs (HY Sep 2025), Consolidated 14,971.00 Lakhs (HY Sep 2025).
  8. Other Income: Standalone 915.73 Lakhs (HY Sep 2025), Consolidated 1,520.59 Lakhs (HY Sep 2025).
  9. Standalone Net cash used in operating activities: (21,197.93) Lakhs (HY Sep 2025).
  10. Standalone Net cash used in investing activities: (36.10) Lakhs (HY Sep 2025).
  11. Standalone Net cash generated from financing activities: 16,649.45 Lakhs (HY Sep 2025).
  12. Consolidated Net cash used in operating activities: (21,237.98) Lakhs (HY Sep 2025).
  13. Consolidated Net cash generated from investing activities: 568.76 Lakhs (HY Sep 2025).
  14. Consolidated Net cash used in financing activities: (3,057.49) Lakhs (HY Sep 2025).
  15. Claims filed by lenders for Bank Guarantees (BGs) amounting to 63,130.79 Lakhs.
  16. Claims filed by lenders for Corporate Guarantees (CGs) amounting to 6,800.00 Lakhs (associate).
  17. CGs for SMTL: 1,82,735.00 Lakhs; CGs for IDTL: 60,068.00 Lakhs.
  18. Standalone Total Assets: 3,44,075.38 Lakhs (Sep 2025).
  19. Standalone Total Equity: (1,47,195.72) Lakhs (Sep 2025).
  20. Consolidated Total Assets: 3,31,425.56 Lakhs (Sep 2025).
  21. Consolidated Total Equity: (1,44,099.01) Lakhs (Sep 2025).
  22. Standalone current liabilities exceed current assets by 2,37,146.24 Lakhs.
  23. Consolidated current liabilities exceed current assets by 2,21,111.17 Lakhs.
  24. Inter Corporate Loan pending for recovery.
  25. Investments in subsidiary, associate, and joint ventures.
  26. Both standalone and consolidated financial results are presented.
  27. Consolidated results include subsidiary, associate, and joint ventures.

Corporate Overview

  1. Registered office in Hyderabad, Telangana, India.
  2. Operations across various states in India, including Maharashtra.
  3. Corporate Insolvency Resolution Process (CIRP) initiated previously.
  4. Defaulted on loan repayment obligations to lenders.
  5. Bank accounts classified as Non-Performing Assets (NPA).
  6. Delays in recovery of trade receivables and advances.
  7. Increased material and service costs affecting operations.
  8. Non-availability of adequate working capital.
  9. Non-awarding of fresh contract works by lenders.
  10. Substantial losses and net worth erosion in investee company.
  11. Subordinate debt unilaterally written off by associate company.
  12. Subsidiary's power project not proceeding, land sold.
  13. Significant reliance on sub-contractors for project execution.
  14. Dependent on lenders for financial facilities and debt restructuring.
  15. Company's operations primarily consist of Construction activities.
  16. Optimistic about recovery of dues and going concern status.
  17. Confident in legal recourse for bank guarantee encashment.
  18. Includes state governments, central government, and NHAI.
  19. No other reportable segments identified.
  20. Proposed power plant construction by subsidiary not proceeding.

Risk Factors

  1. Significant contingent liabilities remain.
  2. Long pending inter-corporate loan recovery.
  3. Subsidiary power project not proceeding.
  4. Working capital issues, no new contracts.

Key Drivers

  1. CIRP withdrawn, debt settlement accepted.
  2. Management confident in recovering dues.
  3. Investee company net worth positive.
  4. Promoters' affairs vested back.

Auditor’s Report

  1. Do not express an audit opinion; this is a limited review report.
  2. Investee company's net worth erosion; no impairment provision made.
  3. Subordinate debt written off by associate; no provision for NCPS/unsecured loan.
  4. Inter Corporate Loan long pending; no provision, no interest income accounted.
  5. Contingent liabilities for corporate guarantees disclosed.
  6. Work advances to sub-contractors long pending recovery.
  7. Delayed recovery of advances from another sub-contractor.
  8. COVID-19 impact, loan defaults, CIRP initiation and withdrawal.
  9. Recoverability of investment/loan to subsidiary; land sold by bank.
  10. Contract advances to step-down subsidiary long pending recovery.

Board Commentary

  1. Directors' powers suspended during CIRP, then vested back to promoters.
  2. Investee company's net worth erosion and losses.
  3. Subordinate debt written off by associate company.
  4. Long pending inter-corporate loan recovery.
  5. Contingent liabilities from bank and corporate guarantees.
  6. Delayed recovery of advances from sub-contractors.
  7. Impact of COVID-19 on business operations.
  8. Working capital issues and non-awarding of contracts.
  9. Subsidiary's power project not proceeding as planned.
  10. Corporate Insolvency Resolution Process (CIRP) initiated and subsequently withdrawn.
  11. SARFAESI notices issued to subsidiary for loan recovery.
  12. Legal recourse taken against illegal bank guarantee encashment.
  13. Investment in Gayatri Hi-tech Hotels Limited (Investee Company).
  14. Investment in Gayatri Energy Ventures Private Limited (Subsidiary).

Corporate Governance

  1. C.V. Rayudu serves as Independent Director and Chairman of Audit Committee.
  2. Audit Committee reviewed and approved the financial results.
  3. Directors' powers suspended during CIRP, later vested back.

Management Discussion & Analysis

Future Strategy

  1. Continuing operations as a going concern post-CIRP withdrawal.
  2. Pursuing recovery of long-pending advances from sub-contractors.
  3. Evaluating claims and legal options for associate company dues.

Macroeconomic Outlook

  1. COVID-19 pandemic effects impacted business operations and cash flows.

Operational Focus Areas

  1. Recovery of outstanding advances and receivables.
  2. Resolution of contingent liabilities from guarantees.
  3. Managing working capital and financial facilities.

Performance Drivers

  1. Successful One-Time Debt Settlement (OTS) proposal acceptance.
  2. Withdrawal from Corporate Insolvency Resolution Process (CIRP).
  3. Management's confidence in recovering various outstanding dues.

Risk Control Measures

  1. OTS proposal accepted by 97.20% COC members.
  2. CIRP proceedings against the company withdrawn by NCLT.
  3. Management confident in recovering dues from associate/sub-contractors.
  4. Legal recourse initiated against illegal bank guarantee encashment.

Critical Risks

  1. Investee company's net worth erosion and losses.
  2. Subordinate debt written off by associate company.
  3. Long pending inter-corporate loan recovery.
  4. Contingent liabilities from bank and corporate guarantees.
  5. Delayed recovery of advances from sub-contractors.
  6. Impact of COVID-19 on business operations.
  7. Working capital issues and non-awarding of contracts.
  8. Subsidiary's power project not proceeding as planned.