Company Overview

Madhucon Projects Limited (MPL) is an integrated construction and infrastructure development company that reported its 36th Annual Report for FY 2025-26. The company will hold its 36th AGM on September 29, 2026 to adopt financial statements, appoint directors and auditors, and consider special business including OTS proposals.

Financial Performance

Standalone Results

  • Reported standalone net profit of ₹11.12 crore for FY 2025-26 versus loss of ₹21.04 crore previous year
  • Total income of ₹66.15 crore with total assets of ₹115.83 crore as of March 31, 2026

Consolidated Results

  • Reported consolidated net loss of ₹46,997.54 lakhs for FY26 with revenue declining to ₹75,144.89 lakhs from ₹101,124.09 lakhs in FY25
  • Current ratio deteriorated to 0.549 from 2.254 previous year
  • Total equity negative at (₹244,109.76) lakhs with non-current liabilities of ₹213,190.99 lakhs

Auditor Qualifications & Governance Issues

P. Murali & Co., Chartered Accountants issued qualified opinions on both standalone and consolidated financial statements citing:

1. Impairment Concerns: Carrying value of investments in subsidiaries totaling ₹43,083.92 lakhs where some have fully/substantially eroded net worth

2. Partial Write-offs: 75% write-off of investment in Madhucon Infra Limited and 66.66% in Madurai Tuticorin Expressways Limited without proper justification

3. Non-provision of Interest: Interest not provided on Punjab National Bank loans despite OTS agreement, pending NOC from bank

4. Revenue Recognition Issues: Recognition of advances of ₹15,252.71 lakhs as revenue without proper justification

5. Write-back of Trade Payables: Amounting to ₹14,279.73 lakhs during FY26

6. Compliance Deficiencies: Non-conduct of internal audit, non-production of title deeds, unreconciled statutory dues including Income Tax ₹139.93 lakhs and Provident Fund ₹63.95 lakhs

Legal and Regulatory Matters

Insolvency Proceedings

Multiple subsidiaries face NCLT proceedings:

  • Ranchi Expressways Ltd: NCLT admitted Section 7 petition by State Bank of India, appeal pending before NCLAT
  • Trichy-Thanjavur Expressways Ltd: NCLT admitted petition by IDBI Bank, appeal pending with next hearing on 02.07.2026
  • Barasat-Krishnagar Expressways Ltd: NCLT admitted petition by State Bank of India, appeal pending with next hearing on 30.06.2026

Investigations

  • CBI filed FIR against Ranchi Expressways Ltd and its promoters under Prevention of Corruption Act
  • Enforcement Directorate raided company premises and filed charge sheet, provisionally attaching 105 immovable properties and 28 other assets worth ₹96.21 Crore and ₹80.65 Crore respectively

Project Terminations

Multiple projects terminated by NHAI including Barasat-Krishnagar, Rajauli-Bakthiyarpur, Madurai-Tuticorin, Trichy-Thanjavur, and Vijayawada-Machilipatnam Expressways

Banking and OTS Situation

The company has defaulted in payment of dues to Punjab National Bank classified as NPA. Outstanding with PNB: ₹3,144.43 lakhs with delay of 2706 days as on March 31, 2026. While OTS agreements have been entered with banks and Canara Bank settlement completed with No Dues certificate, PNB OTS benefits not recognized due to non-receipt of No Objection Certificate.

Going Concern Assumption

The Board maintains going concern assumption despite:

  • Net current liabilities position of ₹16,809.94 lakhs
  • Default in payments to Punjab National Bank
  • Multiple subsidiaries with net worth fully/substantially eroded
  • Various insolvency proceedings against subsidiaries

Management believes settlement of bank dues under OTS and continued discussions with lenders support the going concern assumption.

Corporate Governance & Management Changes

  • Board met 4 times during the year with proper committee functioning
  • Directors resigned during the year including Mrs. Ch. Lakshimi Kumari, Mr. Samba Siva Rao Jasty, and Mr. Ramadas Kasameni
  • New appointments: Mr. Prithvi Teja Nama as Additional Director and Mr. Shankara Rao Kadambala as Independent Director
  • Proposed new statutory auditors M/s B. Narsing Rao & Co LLP and cost auditors M/s AS RAO & CO for FY 2026-27

Forward Outlook

The management discussion highlights opportunities in infrastructure sector with order book position of ₹5,263 crores across transportation, irrigation, and industrial projects. The company is focusing on settlement of banking dues through OTS and improving operational performance, though significant challenges remain from ongoing legal proceedings and subsidiary insolvency issues.