Sanchay Finvest Ltd (511563) Quarterly Report Analysis & Insights

Sanchay Finvest Ltd

| Unaudited Financial Results – Q4 & FY26

⬤28th May 26

Summary : Sanchay Finvest faces severe financial distress, regulatory non-compliance, and significant going concern uncertainty, as highlighted by a qualified audit opinion.

Quarterly Report Analysis & Insights

Financial Disclosures

Total Expenses FY26: 83.55 Lakhs (FY25: 71.86 Lakhs).
Employee benefits expense FY26: 27.26 Lakhs (FY25: 15.29 Lakhs).
Finance Cost FY26: 28.00 Lakhs (FY25: 0.01 Lakhs).
Lack of system for confirming/reconciling receivables, insufficient audit evidence.
Total Revenue (net) FY26: 62.46 Lakhs (FY25: 2.45 Lakhs).
Revenue from Operations (Net of Tax) FY26: 26.01 Lakhs (FY25: -2.24 Lakhs).
Other Income FY26: 36.44 Lakhs (FY25: 4.69 Lakhs).
Net cash flow from operating activities FY26: (31.31) Lakhs (FY25: 184.34 Lakhs) - significant negative shift.
Cash and cash equivalents at year-end FY26: 0.30 Lakhs (FY25: 1.34 Lakhs).
Total Assets FY26: 229.18 Lakhs (FY25: 345.17 Lakhs).
Total Equity FY26: 148.55 Lakhs (FY25: 289.96 Lakhs).
Other Equity FY26: (166.45) Lakhs (FY25: (25.04) Lakhs) - significantly negative.
Current Liabilities FY26: 81.97 Lakhs (FY25: 54.45 Lakhs).
Only standalone financial results presented.

Corporate Overview

Activities restricted within India
Non-payment and non-renewal of preference share dividends, indicating potential non-compliance and regulatory implications.
Regulatory non-compliance leading to penalties from the National Stock Exchange (NSE).
Lack of appropriate system for confirming and reconciling financial balances (deposits, advances, receivables/payables).
Unsubstantiated classification of trade payables without adequate audit evidence.
Significant financial losses and negative other equity for the fiscal year.
Material uncertainty regarding the company's ability to continue as a going concern.
Share Broking & Trading in Shares & Securities
Formal, reporting compliance and financial results.
Single segment: Share Broking & Trading in Shares & Securities

Risk Factors

Qualified audit opinion, going concern uncertainty.
Significant financial losses, negative other equity.
Regulatory non-compliance, penalties from NSE.
Weak internal controls, insufficient financial evidence.

Key Drivers

Applied for preferential equity share issue.
Appointed new internal auditor for compliance.
Cleared some outstanding regulatory dues.

Auditor’s Report

Qualified Opinion
Non-payment of preference share dividends and non-renewal/redemption, indicating potential non-compliance.
Demand notice from NSE for penalties due to non-compliances.
Lack of system for confirming/reconciling deposits, advances, receivables/payables, leading to insufficient audit evidence.
Unsubstantiated classification of trade payables based solely on management's assessment without audit evidence.
Material uncertainty related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern.

Board Commentary

Resignation of Mr. Ramesh Chandra Mishra as Secretarial Auditor.
Appointment of M/s. S K B J P & Co. Chartered Accountants as Internal Auditor for FY 2026-27.
Company has not paid dividends to 40,000 preference shareholders for FY 2024-25.
Preference shares not renewed or redeemed post due date, indicating potential non-compliance.
Potential non-compliance with terms of preference share issue.
Regulatory penalties from National Stock Exchange.
Inadequate internal controls over financial reconciliations.
Unsubstantiated classification of trade payables.
Non-payment/non-renewal of preference shares, potential non-compliance.
NSE demand notice for penalties of Rs. 47.88 lakhs due to non-compliances.
Outstanding dues to NSE of Rs. 28.39 lakhs, subsequently cleared.
Applied for in-principle approval for preferential issue of equity shares to non-promoter investors.

Corporate Governance

Non-payment and non-renewal of preference share dividends, indicating potential non-compliance.
Regulatory non-compliance leading to penalties from NSE.
Lack of internal controls for financial reconciliations.
Unsubstantiated classification of trade payables.
Material uncertainty regarding the company's ability to continue as a going concern.

Management Discussion & Analysis

Future Strategy

Applied for in-principle approval for preferential issue and allotment of equity shares to non-promoter investors.

Operational Focus Areas

Ensuring compliance with Companies Act, 2013 and SEBI Listing Regulations, 2015.

Performance Drivers

Significant decline in total assets and equity.
Shift from positive to negative cash flow from operating activities.

Risk Control Measures

Appointed a new Internal Auditor to enhance compliance.
Cleared outstanding regulatory dues to NSE after receiving notice.
Seeking capital through preferential issue of equity shares.

Critical Risks

Regulatory non-compliance with SEBI and NSE, leading to penalties and legal issues.
Severe financial instability, including significant losses and negative other equity.
Material uncertainty about the company's ability to continue as a going concern.
Weak internal controls and lack of sufficient audit evidence for financial balances.