City Crops Agro writes off all stock, auditor flags missing IPO records
The company swung to a ₹393.21 lakh loss after dumping its entire perishable inventory. Its auditor now questions the use of ₹300.25 lakh in IPO funds.
— 3 earlier stories on City Crops Agro Ltd. →What's new
- Company wrote off its entire opening stock of perishable goods as unsaleable.
- Auditor issued a qualified opinion citing unpaid tax and inactive GST registration.
- ₹300.25 lakh in IPO advances lack supporting agreements or proof of use.
Why this matters
A total write-off of inventory combined with an auditor's refusal to sign off on IPO fund usage is a severe governance failure. For a company with a market cap of only ₹36 crore, these accounting gaps are not minor errors.
What we're watching
- Evidence of corrective actions for the auditor's findings.
- Status of the inactive GST registration and tax liabilities.
- Any further clarification on the missing documentation for IPO advances.
The full read
City Crops Agro ended FY26 in the red, reporting a net loss of ₹393.21 lakh against a profit of ₹247.69 lakh in the prior year. The swing stems from a total write-off of its opening stock of perishable goods.
That is a total loss of inventory.
Beyond the operational hit, the auditor issued a qualified opinion that casts doubt on the company's internal controls. The audit report flags ₹25.36 lakh in unpaid income tax, an inactive GST registration, and ₹300.25 lakh in advances from IPO proceeds that lack any supporting agreements or evidence of use. Trade receivables and payables remain unconfirmed, with some balances aging beyond two years. For a company with a market capitalization of just ₹36 crore, these findings are a massive red flag. Management claims to have started corrective actions, but the lack of documentation for IPO funds remains the primary concern for shareholders.
Questions answered
- Why did the company report a loss this year?
- City Crops Agro swung to a loss of ₹393.21 lakh from a prior-year profit of ₹247.69 lakh because it wrote off its entire opening stock of perishable goods.
- What specific concerns did the auditor raise?
- The auditor issued a qualified opinion highlighting ₹25.36 lakh in unpaid income tax, an inactive GST registration, and ₹300.25 lakh in IPO advances that lack supporting documentation.
- Are there issues with the company's trade balances?
- The auditor noted that trade receivables and payables were not fully confirmed, with some balances remaining outstanding for more than two years.
- How has the company responded to these findings?
- The company stated that it has initiated corrective actions to address the observations made by the auditor.
Story so far
All notes on CCAL →- 28 May 2026 · 11:23 AM IST City Crops Agro writes off all stock, auditor flags missing IPO records
- 1d ago City Crops Agro swings to loss as auditor flags missing IPO records
- 1d ago City Crops Agro writes off all stock as auditors flag missing IPO cash
- 1d ago City Crops Agro writes off all stock, posts loss as auditor flags IPO cash