Rajasthan Tube Manufacturing's record has unravelled in two years: revenue collapsed from ₹94.91 crore to ₹17 lakh, the promoter sold his entire 20.29% stake and resigned, and SEBI imposed penalties for financial misrepresentation. The statutory auditor resigned mid-tenure with no reason given, while a SEBI order later identified ₹23.76 crore in fund flows with a connected party that never appeared in the company's related-party disclosures.
Key findings
- Revenue fell sharply as share of overdue receivables nearly doubled
Major- Revenue fell from ₹94.91 crore in FY24 to ₹56.34 crore in FY25, then to just ₹17 lakh in FY26. Trade receivables older than six months rose from ₹1.11 crore to ₹1.91 crore even as total good receivables shrank, and receivable days spiked from 22 to 107 over the same two years. The DSRI, which measures how fast receivables are growing relative to sales, hit 2.92 in FY26. - SEBI penalised the company and directors in September 2025 for financial misrepresentation
Major- SEBI Adjudication Order No. Order/AK/RK/2025-26/31647-31657 dated 5 September 2025 found violations of the SEBI Act, SCRA, PFUTP Regulations, and LODR Regulations across 11 noticees including the company. The order records that an independent director and audit committee member admitted he was unaware of terms like 'audit qualifications' and 'internal controls', did not remember the company's turnover, and was "blindly signing the minutes". The company filed a revision petition during FY2018-19 against a 7 January 2019 order in a criminal complaint filed by the ROC over director responsibility statements under Section 134(8) of the Companies Act. - The sole disclosed related-party loan shrank to zero, but SEBI found ₹23.76 crore in undisclosed fund flows
Major- An unsecured loan from Managing Director Harish Chand Jain fell from ₹77.60 lakh in FY22 to zero by FY25. Every annual AOC-2 disclosure from FY20 through FY25 stated there were no related-party transactions that were not at arm's length. The SEBI adjudication order dated 5 September 2025 records the company received an aggregate ₹23.76 crore from Noticee 1 and connected entities, including ₹4.72 crore from KMPs and relatives, none of which appeared in the annual RPT disclosures. - The promoter exited his entire 20.29% stake and resigned; his daughter-in-law's re-election was defeated by public shareholders
Major- Harish Chand Jain sold his entire 9.15 lakh shares off-market during FY25 and declared on 10 June 2026 that his family has had no control since 28 June 2025. The resolution to re-appoint his daughter-in-law Rajshree Jain was defeated at the 21 July 2025 AGM with 57.76% of votes cast against. Three other promoter-group members sold down holdings in May 2025, and promoter holding fell from 34.08% to 16.80% over the year to FY26. - The statutory auditor resigned mid-tenure with no stated reason, and the company appointed a new firm
Major- M/s Giriraj & Lohiya resigned on 20 June 2025 before completing their five-year term ending in 2026, and no reason was disclosed. A partner of that firm had served as scrutiniser for the EGM held on 29 March 2025. The company appointed UCC & Associates LLP on 21 June 2025 for a fresh five-year term, but Bakliwal & Co. was the auditor for the quarter ended 31 March 2026, indicating a further change. - Operating cash flow has swung sharply, but the company carries zero debt and zero capital work in progress
Clean- FY26 operating cash flow was ₹13.67 crore against profit of ₹1.24 crore, while FY23 cash flow was negative ₹0.68 crore against profit of ₹0.96 crore. The company reported no capital work in progress in FY24, FY23, or FY22. No dividends were declared or paid during FY25, FY24, or FY23.
What to watch
- Promoter-group removal. Whether SEBI or the stock exchanges approve the application by Harish Chand Jain and family for removal from the promoter group, declared on 10 June 2026.
- Board stability. Whether the board composition stabilises following the appointments of three new directors on 26 February 2026.
- SEBI order appeal. Outcome of any appeal or further proceedings arising from the SEBI adjudication order dated 5 September 2025.
- Auditor resignation reason. Whether the company discloses the reason for Giriraj & Lohiya's resignation, as required by Section 140 of the Companies Act 2013.
Bottom line: This is a record of collapse, not a going concern with blemishes. Revenue has all but vanished, the promoter has exited, the auditor walked out without explanation, and a SEBI order has laid out fund flows and director admissions that the annual filings never captured. The clean audit opinions and zero-debt balance sheet are artefacts of a company that has already wound down its operations. Watch the SEBI proceedings and the criminal revision petition, they will determine whether what remains is a shell or a liability.