Another Future Group company — Future Supply Chain Solutions — faces insolvency proceedings

Another Future Group company – Future Supply Chain Solutions – is now going to face insolvency resolution process after the National Company Law Tribunal (NCLT) has admitted an insolvency petition against the company by DHL Ecommerce (India) Private Limited on for default of outstanding amount payable to operational creditor, the company informed the exchanges.
Future Supply Chain Solutions is a third-party supply chain and logistics service provider, promoted by Future Enterprises Limited, which is promoted by Kishore Biyani.

Future Supply Chain Solutions offers automated and IT-enabled warehousing, distribution and other logistics solutions to a wide range of customers.

It has a clientele from across various sectors in India, including retail, fashion and apparel, automotive and engineering, food and beverage, fast-moving consumer goods (FMCG), e-commerce, healthcare, electronics and technology, home and furniture and ATMs.

The company has been facing financial distress and has been making losses. In 2021-22, it made a loss of Rs 697 crore on a revenue of Rs 685 crore. In the June 2022 quarter, the company made a loss of Rs 30 crore on a revenue of Rs 78 crore.

According to the auditors of the Future Supply Chain Solutions, the entire net worth of the company has been eroded due to losses incurred in the previous year and its current liabilities exceeded its current assets which indicates a material uncertainty exists, that may cast a significant doubt on the company’s ability to continue as a going concern.

At the end of June 2022 quarter, the company’s net worth was a negative Rs 170 crore.

“The Company is in the process of implementing business revival plans which in the opinion of the management would enable the Company to have sustainability and turnaround of its business operations. The Company’s ability to generate positive cash flows depends on the successful implementation of such business revival plans. Pending the resolution of the above uncertainties, the Company has prepared the aforesaid statement on a going concern basis,” remarked the auditors.

Also see: Reliance Retail among 13 vying for Future Retail assets