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R S Software (India) Ltd

| Quarterly Financial Results Q3 FY 2025–26

BEARISH SENTIMENT

Report Source

⬤21st Jan 26

Summary : R.S. Software reported significant losses and declining revenue for Q3/9M FY26, with auditors raising going concern uncertainty despite an unmodified opinion.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Standalone Total Expenses (Dec'25 Quarter): 1344.85 Lac (up from 1270.34 Lac in Dec'24).
  2. Consolidated Total Expenses (Dec'25 Quarter): 1379.17 Lac (up from 1066.57 Lac in Dec'24).
  3. Employee benefits expense (Dec'25 Quarter): 722.89 Lac (Standalone), 723.89 Lac (Consolidated).
  4. Other expenses including subcontractor (Dec'25 Quarter): 412.23 Lac (Standalone), 447.50 Lac (Consolidated).
  5. Standalone Revenue from Operation (Dec'25 Quarter): 535.03 Lac (down from 1268.32 Lac in Dec'24).
  6. Consolidated Revenue from Operation (Dec'25 Quarter): 535.03 Lac (down from 1268.32 Lac in Dec'24).
  7. Standalone Segment A (USA) Revenue (Dec'25 Quarter): 203.87 Lac.
  8. Standalone Segment B (ROW) Revenue (Dec'25 Quarter): 331.17 Lac.
  9. Standalone Net Cash from Operating Activities (Dec'25): (63.54) Lac (negative).
  10. Consolidated Net Cash from Operating Activities (Dec'25): (310.42) Lac (negative).
  11. Standalone Net Cash from Investment Activities (Dec'25): (687.79) Lac (negative).
  12. Consolidated Net Cash from Investment Activities (Dec'25): (672.58) Lac (negative).
  13. Standalone Closing Cash and Cash Equivalents (Dec'25): 670.47 Lac (down from 1,558.26 Lac in Mar'25).
  14. Consolidated Closing Cash and Cash Equivalents (Dec'25): 1,268.92 Lac (down from 2,301.92 Lac in Mar'25).
  15. Standalone Total Assets (Dec'25): 9,487.21 Lac (down from 9,559.04 Lac in Mar'25).
  16. Consolidated Total Assets (Dec'25): 7,074.08 Lac (down from 7,288.50 Lac in Mar'25).
  17. Standalone Other Equity (Dec'25): 5,240.85 Lac (down from 6,893.69 Lac in Mar'25).
  18. Consolidated Other Equity (Dec'25): 2,654.94 Lac (down from 4,441.52 Lac in Mar'25).
  19. Standalone Cash & Cash Equivalents (Dec'25): 550.15 Lac (down from 1,394.01 Lac in Mar'25).
  20. Consolidated Cash & Cash Equivalents (Dec'25): 1,148.60 Lac (down from 2,137.67 Lac in Mar'25).
  21. Standalone Lease Liability (Non-Current) (Dec'25): 1,434.46 Lac (up from 54.77 Lac in Mar'25).
  22. Consolidated results include subsidiaries Responsive Solution Inc. and Paypermint Pvt. Ltd.
  23. Consolidated total assets are lower than standalone total assets.
  24. Consolidated net loss is higher than standalone net loss.

Risk Factors

  1. Significant losses impacting financial stability.
  2. Declining revenue across all segments.
  3. Negative cash flow from operations.
  4. Auditor's concern about going concern.

Key Drivers

  1. Unmodified audit opinion on financials.
  2. Company focused on electronic payments.
  3. Global presence in USA and ROW.
  4. Subsidiaries expand market reach.

Auditor’s Report

  1. Unmodified Opinion (for both standalone and consolidated financial results).
  2. Auditors highlighted a material uncertainty regarding the company's ability to continue as a going concern, noting that future events or conditions may cause the Company/Group to cease operations.

Board Commentary

  1. Dividend Paid (Consolidated: 50.00 Lac for 9M ended Dec'25).
  2. Purchase of Property Plant & Equipment (Consolidated: 598.74 Lac for 9M ended Dec'25).

Corporate Governance

  1. Auditors confirm compliance with the Code of Ethics.
  2. Auditors confirm compliance with ethical requirements regarding independence.
  3. Audit Committee reviewed and approved the financial results.

Management Discussion & Analysis

Performance Drivers

  1. Revenue from operations declined significantly in Dec'25 quarter compared to previous periods.
  2. Total expenses increased, contributing to the reported losses.
  3. Both USA and ROW segments reported losses before tax and interest.

Critical Risks

  1. Material uncertainty exists regarding the company's ability to continue as a going concern.
  2. Sustained negative financial performance and cash flows.