Alok Industries Q3 numbers fail to impress; accumulated losses at Rs 21,000 crore
Alok Industries, which underwent a corporate insolvency resolution process under the Insolvency and Bankruptcy Code (IBC) and the resolution process was completed after reconstitution of the board in September 2020, continues to face challenges as losses keep mounting.
In the third quarter of 2022-23, the company posted a consolidated loss of Rs 250 crore compared to a loss of Rs 9 lakh in the same quarter previous year. Alok Industries, which is now a Reliance Industries subsidiary, has not been able to revive its fortunes despite being under the new management for more than two years now.
Its consolidated revenue for the third quarter was Rs 1,709 crore, which is lower than Rs 2,142 crore revenue that it generated in the year-ago period. This despite the fact that the raw material costs have come down for the company over the last one year.
For the 9-month period ending 31 December 2022, the company has managed to generate a revenue of Rs 5,431 crore, which is slightly more than Rs 5,323 crore it generated in the previous 9-month period. Losses during this period have jumped over 3 times from Rs 181 crore to Rs 583 crore.
Alok Industries did raise hopes after its sales grew 91.44% to Rs 7,151 crore and EBIDTA by 53% to Rs 612 crore and made a Cash Profit of Rs 161 crore in 2021-22 as compared to cash loss of Rs 66 crore in the previous year.
However, things have not gone well in 2022-23 for the company as it has not been able to show any significant improvement in any of the financial performance indicators. Alok Industries accumulated losses as on 31 December 2022 has reached Rs 21,000 crore and its current liabilities exceed its current assets by Rs 626 crore.
The share price movement of the company has been the testimony to the Alok Industries less than impressive performance in the post-CIRP period. The share price of the company has dropped by 54% in the past one year. Since the reconstitution of the new board,
Alok Industries underwent the corporate insolvency resolution process under section 31 of the Insolvency and Bankruptcy Code, 2016. The resolution plan of Reliance Industries and JM Financial ARC was approved by the National Company Law Tribunal, Ahmedabad Bench in its order dated 8 March 2019 and the implementation of the Approved Resolution Plan was concluded in 2020 with the re-constitution of the Board of Directors of the Holding Company on 14th September, 2020.
Reliance Industries hold 40% in Alok Industries and JM Financial ARC has 35% stake in the company.
