Shivamshree Businesses Ltd carries a five-year chain of qualified audit opinions on its core balances, receivables, payables, and loans, while the same auditor signed off on internal financial controls as effective every year. The FY2026 report continues the qualification streak with an "Except for" opinion and introduces a Key Audit Matter on a ₹2.58 crore creditor-to-borrowings reclassification that multiplies reported debt nearly fourfold. Operating cash flow has run negative against reported profit for six years, and ₹7.33 crore sits in capital work-in-progress with no commercial start date. The company has zero promoter shareholding, a board whose statutory auditor has remained unchanged since at least FY2021, and two independent directors whose DINs stood deactivated as of June 2026.
Key findings
- ₹2.58 crore of trade payables reclassified into borrowings
Major- During FY2025-26, the company reclassified ₹2.58 crore of sundry creditors into Long-Term Borrowings under a Board Resolution and revised terms, converting supplier obligations into formal debt without new cash inflow. As of 31 March 2025, the outstanding balance of borrowings was ₹0.67 crore. The auditor identified this as an event with major bearing on the FY2025-26 audit. - Operating cash flow is deeply negative and disconnected from reported profit
Major- Cumulative CFO over the six years FY21-FY26 was negative ₹1 crore against cumulative EBITDA of ₹1 crore, a ratio of -0.90x. In FY26, the company reported a profit of ₹0.15 crore but CFO was negative ₹2.81 crore, a CFO/PAT ratio of -18.73x. Meanwhile, ₹7.33 crore of capital work-in-progress for a Solar Power Plant and FIBC Bags manufacturing unit represents 191% of net PP&E of ₹3.83 crore, with no commercial commencement date disclosed. - BSE trading suspension and promoter account freeze from multi-year listing-fee defaults
Major- BSE moved the company's equity shares to the Trade-to-Trade segment and froze promoter and promoter group demat accounts for all debits due to non-payment of Annual Listing Fees, as reported in FY2020-21. Annual Listing Fees to BSE were not paid for FY2019-20, FY2020-21, and FY2021-22. The company stated in FY2023-24 that it had paid all pending dues and was in the process of seeking revocation of the suspension of its securities. - Revenue swung from near-zero to ₹15.11 crore in FY26 on a new manufacturing segment
Minor- Revenue from operations collapsed 64.5% from 11.63 crore in FY24 to 4.13 crore in FY25, then surged to ₹15.11 crore in FY26. The company operated in a single segment in FY21, then reported two segments in FY25-FY26: Manufacturing of Industrial Bags (₹0.40 crore in FY25, ₹15.02 crore in FY26) and Trading of Solar Power Generating Systems (₹3.73 crore in FY25, ₹0.09 crore in FY26). Trade receivables stood at ₹1.29 crore as of FY26, with Receivable Days of 31, compared to 50 days in FY25 and 51 days in FY24. - Accounting choices materially reshape reported profits and balance sheet
Minor- In FY2022 and FY2021, the company charged no depreciation, stating the amount was a "very minor amount". Authorised share capital was increased from ₹5 crore to ₹9 crore via a special resolution passed at an EGM on 1 March 2025, and 3 crore equity shares were allotted at ₹1.50 per share on a preferential basis during FY2025, raising paid-up capital to 7.56 crore shares. The company elected to exercise the option under Section 115BAA of the Income Tax Act, 1961, and remeasured its deferred tax at the prescribed rate from FY2022 onward. - The same statutory auditor has been in place since at least FY2021 with no rotation
Minor- M/s. M A A K & Associates (FRN: 135024W) has been the statutory auditor continuously from FY2020-21 through FY2025-26, with the signing partner being CA Kenan Satyawadi in every year. The auditor was re-appointed by shareholders at the AGM on 27 September 2023 for a five-year term, receiving 100% of votes in favour. Audit fees paid were ₹0.30 lakhs in both FY2023-24 and FY2022-23.
What to watch
- Creditor reclassification. The ₹2.58 crore reclassification of sundry creditors (Shree Maruti Bulk Packaging Private Limited) into Long-Term Borrowings requires monitoring for proper disclosure and repayment terms in the FY2027 annual report.
- CWIP commercial commencement. No commercial commencement date has been disclosed for the Solar Power Plant and FIBC Bags manufacturing unit as of the FY2025-26 annual report, monitor subsequent quarterly results and annual reports.
- Independent Director appointment. The company stated in the FY2025-26 Board's Report it is "actively seeking" to fill the statutorily required additional Independent Director vacancy but faces delays.
- Deactivated DINs. Mr. Nilesh Himatlal Trivedi (DIN: 08141177) and Mr. Rajesh Bhavanbhai Chauhan (DIN: 08141179) had "Deactivated due to non-filing of DIR-3 KYC" status as of the 3 June 2026 certificate.
- Company Secretary vacancy. Mr. Deepank Agrawal resigned as Company Secretary and Compliance Officer effective 30 June 2026.
Bottom line: This is a record where the auditor has said for five years that it cannot confirm the company's core balances, while simultaneously vouching for the controls that produce them. The FY2026 shift to an unmodified opinion does not resolve that tension, it adds a creditor-to-debt reclassification that quadruples borrowings and a CWIP balance that dwarfs the company's fixed assets. The governance structure is a shell: no promoter stake, no director pay, and a board that has failed statutory composition rules. Read the cash flow statement before the profit line, and watch whether the BSE suspension is revoked and the deactivated director DINs are restored.