Nova Iron Steel Q1 FY27 Loss with Material Uncertainty

Revenue from operations: ₹6,749.03 for Q1 FY27 (compared to ₹11,297.09 in Q1 FY26 and ₹13,583.29 in Q4 FY26)
Other Income: ₹15.33 for Q1 FY27
Total Income: ₹6,764.36 for Q1 FY27
Total Expenses: ₹6,989.11 for Q1 FY27
Loss before tax: ₹(85.87) for Q1 FY27
Net Loss after tax: ₹(85.87) for Q1 FY27
Total Comprehensive Loss: ₹(85.87) for Q1 FY27
Paid-up equity share capital: ₹3,613.95 lakhs (36,139,500 shares of face value ₹10.00 each)
Earnings per share (basic and diluted): ₹(0.24) for Q1 FY27

MNRS & Associates issued a qualified review report noting:

The company has not recognized interest on borrowings outstanding with respect to certain lenders within finance costs
The impact of this non-recognition is unascertainable in the absence of required information
Except for this matter, nothing came to their attention suggesting the results are not prepared in accordance with Ind AS

The auditors highlighted a material uncertainty regarding the company's ability to continue as a going concern due to:

Loss of manufacturing base including capital work-in-progress due to charge enforcement by various lenders
Pending litigations including an application under IBC, 2016
Provisional attachment orders from the Directorate of Enforcement

Insolvency Proceedings:

M/s MN Corporation filed an application u/s 7 of Insolvency and Bankruptcy Code, 2016 before NCLT Cuttack on February 5, 2026
The application is pending before NCLT
The company entered into a settlement agreement dated May 15, 2026 with M/s MN Corporation, whereunder part payment has been made

Enforcement Directorate Actions:

Received three Provisional Attachment Orders from Directorate of Enforcement under Section 5(1) of PMLA, 2002:
Order No. 15/2026 dated June 25, 2026
Order No. 17/2026 dated July 8, 2026
Order No. 21/2026 dated August 7, 2026
Total attachment value: ₹1,049 crore
Includes immovable properties of the company valued at ₹111 crore
Balance comprises equity shares of the company held by certain shareholders and immovable properties not held in company's name
Orders are provisional and subject to confirmation by Adjudicating Authority
Company is contesting the matter based on legal advice

Asset Transfers:

Transferred capital work-in-progress on June 6, 2026 due to enforcement of charge by M/s Ess Enn Investments Pvt. Ltd. for non-repayment of outstanding dues

Operational Shift:

Manufacturing activities discontinued after licensor terminated license agreement for plant, machinery, land and building on April 1, 2026
Company commenced dealing/trading in steel and allied products effective April 1, 2026
Substantial change in nature and scale of operations from manufacturer to trader
Closing raw material and finished goods as at March 31, 2026 reclassified into stock-in-trade as at April 1, 2026

Exceptional Items:

Management believes there is no threat to the going concern assumption due to: