Vaxfab's auditor refuses to sign off on FY26 accounts
Chandabhoy & Jassoobhoy issued a disclaimer citing inadequate books and missing confirmations, questioning the reliability of the financials.
— 1 earlier story on Vaxfab Enterprises Ltd. →What's new
- Vaxfab board approved audited FY26 results with standalone net profit of ₹3.64 cr.
- Auditor Chandabhoy & Jassoobhoy issued a disclaimer of opinion on both standalone and consolidated results.
- Disclaimer cites inadequate books, missing confirmations, and unsecured loans without agreements.
Why this matters
For a nano-cap with a market cap of ₹151 cr and a high P/E of 41.4, an auditor disclaimer is a severe governance failure. The reported numbers cannot be relied upon, putting the company's growth story—89.9% revenue growth in the trailing period—into serious doubt. This could trigger regulatory scrutiny and investor backlash.
What we're watching
- Whether management issues a restatement or provides additional explanations.
- Potential action from stock exchanges or SEBI given the severity of the disclaimer.
- Impact on the stock price and trading volumes in the coming sessions.
The full read
Vaxfab Enterprises' board approved its audited FY26 results, reporting a standalone net profit of ₹3.64 crore and a consolidated net loss of ₹4.63 crore. But the numbers come with a stark caveat: the company's auditor, Chandabhoy & Jassoobhoy, refused to sign off. The statutory auditor issued a disclaimer of opinion, citing inadequate books of account maintained by the previous management, missing balance confirmations from debtors and creditors, and unsecured loans that lacked formal agreements. Without reliable books, the auditor said it could not obtain sufficient evidence to vouch for the transactions. For a ₹151 crore market-cap company with trailing revenue growth of 89.9% and a P/E of 41.4, this disclaimer undermines the entire financial story. The reported profit may be technically there, but it is essentially unverified. This is not the first time Chandabhoy & Jassoobhoy has flagged issues with Vaxfab's accounts; it follows a similar disclaimer in prior coverage. The open question now is whether management can supply the missing documentation and restore credibility, or whether this will escalate into a regulatory red flag.
Questions answered
- What does a disclaimer of opinion mean?
- A disclaimer means the auditor could not obtain sufficient evidence to form an opinion on the financial statements. The numbers may be unreliable, and the auditor is effectively saying it cannot vouch for the accuracy.
- Why did the auditor issue a disclaimer?
- Chandabhoy & Jassoobhoy cited inadequate maintenance of books of account under the previous management, absence of balance confirmations from debtors and creditors, and unsecured loans without formal agreements.
- Are these issues new or recurring?
- Our prior coverage from May 2026 notes that the auditor previously refused to sign off on FY26 results, suggesting these are recurring governance problems rather than a one-off event.
- What does this mean for investors?
- Investors cannot rely on the reported profit of ₹3.64 cr or any other figure in the FY26 financials. The disclaimer raises risks of hidden liabilities or overstated assets, and the stock's high valuation of 41.4x earnings is now based on questionable numbers.
- What should the company do next?
- Management needs to address the auditor's concerns by providing the missing documentation, obtaining balance confirmations, and possibly restating the accounts with a compliant basis. They may also need to engage a new auditor if the current one cannot resolve the issue.
Vaxfab Enterprises Ltd.
Latest quarter · Mar 2026
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All notes on VEL →- 7 Jul 2026 · 2:38 PM IST Vaxfab's auditor refuses to sign off on FY26 accounts
- 41d ago Vaxfab Enterprises posts profit, but auditor refuses to sign off