Modis Navnirman’s record shows six years of unqualified audit opinions and a clean promoter pledge position, but the cash conversion is deeply negative: cumulative operating cash flow of ₹-80 crore against cumulative profit after tax minus other income of ₹54 crore over the same period. Revenue jumped 84% to ₹189 crore in FY26, driven by a merger recast and a single project that supplied 75% of the top line.
Key findings
- Operating cash flow has been persistently negative for six years despite rising profits
Major- Cumulative operating cash flow from FY21 through FY26 was ₹-80 crore against cumulative profit after tax minus other income of ₹54 crore, a ratio of -1.49 times. Free cash flow was negative in every one of those years, even as profit was positive in each. In FY26 alone, operating cash flow was ₹-2.33 crore against a profit of ₹29.18 crore. - Revenue surged 84% to ₹189 crore, but the jump is merger-driven and concentrated
Major- Revenue from operations grew 84% year-on-year to ₹189.31 crore in FY26. One project contributed ₹141.36 crore, or 75% of that total. The CFO stated that the merger of a private entity into the listed company made the standalone figures “looked a little better” because flats from the merged entity were sold. - A disputed GST demand of ₹10.2 crore spanning five years is disclosed
Minor- As of FY26, the company disclosed a contingent liability of 10.22 crore for a disputed GST demand covering FY21 through FY25, including tax, interest and penalty. The Scheme of Arrangement transfers all contingent liabilities of the transferor company, whether disclosed or undisclosed, to Modis Navnirman. - Audit opinions have been consistently unqualified, but the audit trail was not fully operational in FY24 and FY25
Minor- The statutory auditor issued unqualified opinions on the standalone and consolidated financial statements for every year from FY23 through FY26. In both FY24 and FY25, the auditor reported that the accounting software’s audit trail feature “has not been operated throughout the period for all transactions recorded in the software” and was unable to comment on it. Undisputed statutory dues of ₹20.92 lakhs, comprising Professional Tax of ₹0.26 lakhs and GST Payable of ₹20.66 lakhs, remained in arrears for more than six months as at 31 March 2024 and 31 March 2025. - Subsidiary denied in standalone filings, later merged
Minor- In FY23, Shree Modi’s Navnirman Private Limited became a wholly owned subsidiary. The FY23 and FY24 standalone financial statements each state “there is no Subsidiary of reporting entity”. The NCLT Mumbai Bench approved the amalgamation on 16 October 2025, and the subsidiary has ceased as a subsidiary company and merged with MNL. - Minor procedural non-compliances with SEBI and MCA filing deadlines resulted in small penalties
Minor- Mr. Mahek Modi, Whole-Time Director, paid a penalty of Rs. 10,000 for an error in the FY25 MGT-7 filing, per a RoC order dated 2 February 2026. BSE levied a fine of Rs. 10,000 plus GST for a delay in prior intimation of a board meeting, paid on 12 October 2023. The Board stated that no significant or material orders have been passed by any regulator impacting the company’s going concern. - Promoter family holds four of eight board seats and all three executive roles
Clean- The board comprised eight directors as of 31 March 2026: three executive directors, all from the Modi family, and five non-executive directors. Promoter and promoter group shareholding stood at 63.79% as of 30 June 2025, with zero pledge. Votes against the four remuneration resolutions at the February 2024 EGM ranged from 0.01% to 0.02% of votes cast.
What to watch
- Redemption of zero-coupon debentures. 300 debentures of ANS Private Limited are due for redemption on 13 June 2026.
- Director re-appointment. Mr. Dinesh Modi retires by rotation and stands for re-appointment at the 5th AGM on 5 August 2026.
- GST demand resolution. The disputed GST demand of 10.22 crore had no scheduled resolution date as of the FY26 annual report.
- Ind AS 101 reconciliations. The FY26 consolidated financial statements present the Ind AS 101 reconciliation of total equity as at 31 March 2025 and 1 April 2024.
Bottom line: This is a disclosed and consistently audited record with a clean promoter pledge. The risk is in the cash gap: six years of reported profit have not translated into operating cash, and the FY26 revenue surge rests on a merger recast and a single project. Watch whether the GST demand crystallises and whether the cash cycle begins to convert profit into receipts.