Reliance Naval scrip dips 13% as auditors doubt its future
New Delhi: Shares of Reliance Naval and Engineering cracked over 13 per cent on Tuesday after auditors of the Anil Ambani-led firm raised doubts about the company's ability to "continue as a going concern".
The stock slumped 13.33 per cent to end at Rs 23.40 on BSE. Intra-day, it tumbled 18.14 per cent to Rs 22.10 — its 52-week low.
The company's market valuation also came down by Rs 265.04 crore to Rs 1,725.96 crore.
Selling was also seen in other Reliance group stocks, with Reliance Communications tumbling 10.47 per cent, Reliance Power 4.18 per cent, Reliance Infrastructure 1.89 per cent and Reliance Capital 1.34 per cent.
Meanwhile, Auditors of Anil Ambani-led Reliance Naval and Engineering have raised doubts about the company's ability to "continue as a going concern".
In its notes to the company's 2017-18 earnings statement, auditors Pathak H D & Associates listed cash losses, erosion of network, loans being called back by secured lenders, current liabilities being substantially higher than assets and winding up petitions being filed by few operating creditors to raise its doubts.
"These conditions indicate the existence of a material uncertainty that may cast significant doubt on the company's ability to continue as going concern," the auditor said in the note.
The assumption of going concern depends upon the approval of the company's bankruptcy-related resolution plan by secured lenders, its ability to raise finance, generation of cash flows in future to meet obligations and earning profits in future, it said.
The company on Monday reported widening of its net loss to Rs 408.68 crore in January-March quarter of 2017-18 fiscal year from Rs 139.92 crore net loss in the same period of previous financial year. For the full year 2017-18, it posted a net loss of Rs 956.09 crore as compared to a loss of Rs 523.43 crore in previous year.
Revenue also fell to Rs 34.76 crore in fourth quarter of FY18 from Rs 250.84 crore in same period of previous fiscal.