C2C Advanced Systems gave two different receivables numbers on the same call
CEO said ₹15 cr would be received by July 31, but later claimed over ₹25 cr already realized since March 31 — no reconciliation offered.
What's new
- FY26 PAT of ₹18 cr hit by ₹14.5 cr IFRS 9 provision, called reversible by management.
- New CEO Krishna Chandra acknowledged late filing and receivables mistakes, committed to September collection deadline.
- Counter-drone contract worth ₹80 cr expected to close by September-October; OSI Maritime order runs through end-2027.
Themes from the call
Order book
Counter-drone and combat management systems are key; over ₹1,000 cr in potential bids, but management refused FY27 revenue guidance.
Margins
India net margins capped at 25%; overseas margins higher; material costs not to exceed 40% of contract value.
Capital allocation
Promoter loans to be replaced with equity; cash at ₹10-12 cr; EPF dues to be cleared in coming weeks.
Guidance watch
- Minimum 80% of receivables beyond 180 days to be collected by end-September 2026.
- At least ₹15 cr to be received by July 31; collection updates every 15 days.
- September results within 3 weeks of half-year closure; audited quarterly from March 2027.
- Refused FY27 revenue or consolidated margin guidance.
Risk flags
- Internal inconsistency on receivables collection figures undermines credibility of the recovery timeline.
- IFRS 9 provision of ₹14.5 cr may not reverse if collections slip; no clean financial bridge provided.
- SA 570 observation, though management denies it is a going-concern qualification, remains a flag.
- EPF delays suggest working capital stress; no clarity on promoter loan-to-equity timeline.
Key quotes
-
"Hold us to the September date and we will deliver."
— Krishna Chandra, CEO, on receivables recovery -
"Over 25 crores."
— C2C management, on collections since March 31
The brief
C2C Advanced Systems is in a credibility reset. The new CEO, Krishna Chandra, has owned past mistakes — late filings, aged receivables, a near-qualification audit observation — and laid out a collection-driven recovery plan. The plan has numbers: at least 80% of overdue receivables by September, ₹15 cr by July 31, contract intake capped by payment discipline. But within the same call, management gave two different collection numbers: the CEO said ₹15 cr by month-end; later the team said over ₹25 cr had already been realized since March. The gap was not explained. The inconsistency matters because receivables recovery is the single bridge between C2C's current state and any future growth story. The Rs 14.5 crore IFRS 9 provision, which suppressed FY26 PAT to ₹18 cr, is supposed to reverse as collections arrive. If the collection numbers don't line up, that reversal is uncertain. On the positive side, management has acknowledged the control failures, retained customer acceptance letters, and is switching to audited quarterly reporting from March 2027. The counter-drone and OSI Maritime orders provide a pipeline. But the immediate test is arithmetic: the numbers must reconcile before the strategy roadmap gets a hearing.
C2C's collection recovery is the only metric that matters. The CEO's own numbers don't yet add up.