What’s new

• Revenue climbed to ₹7,753.63 lakh from ₹2,919.30 lakh in FY25.
• Auditors issued a qualified opinion citing missing balance confirmations and ₹2,500.10 lakh in unverified inventory.
• Accumulated losses now exceed paid-up capital and net worth.

Why it matters

The sharp rise in profit is overshadowed by a qualified audit report that questions the company's basic financial health. With current liabilities exceeding assets and unverified inventory accounting for a large portion of the balance sheet, the company faces a clear going-concern risk.

What we’re watching

• Progress on the promised corrective reconciliations.
• Any further explanation regarding the purchase of gold and diamonds outside normal business operations.
• Whether the auditor maintains the qualified opinion in future quarters.

The full read

Chandrima Mercantiles posted a sharp increase in FY26 performance, with revenue reaching ₹7,753.63 lakh and net profit rising to ₹598.86 lakh.

These figures come with a heavy caveat. The company’s auditors issued a qualified opinion, citing a lack of balance confirmations and ₹2,500.10 lakh in unverified inventory. The audit also revealed an unpaid ₹49 lakh income-tax demand and missing edit logs. Beyond the accounting gaps, the company’s balance sheet is under pressure. Accumulated losses have now exceeded paid-up capital and net worth, while current liabilities have surpassed current assets. Management also disclosed purchases of gold and diamonds that sit outside the company's regular business scope, which were made without any recorded sales. These factors create a precarious situation for the firm, as the audit qualifications point to fundamental issues with financial oversight and liquidity. The path forward depends entirely on the success of the reconciliations management claims are currently in progress.

It is a mess.

Primary source: BSE · NSE