SKP Securities Ltd Forensic Report - SOIC x StockScans Report

as of Aug 2026

SKP Securities' record is a study in disclosure gaps that persist despite clean audit opinions. The company has received unqualified opinions for seven straight years, but the substance of its related-party dealings, off-balance-sheet pledges, and cash-flow volatility warrants scrutiny. The most pressing issue is a related-party credit line approved by shareholders after over 51 lakh votes were invalidated, alongside pledged assets of ₹3,658.87 lacs that never appear as borrowings.

Key findings

  1. Shareholders approved a ₹5 crore related-party credit line after 51.2 lakh votes were invalidated Major - An Ordinary Resolution on 29 March 2026 authorised material related-party transactions with SKP Commodities Limited, a company where the MD, Executive Director and CFO hold shares. The vote passed with 5,31,691 in favour and 14 against, while 51,22,580 votes from 7 members were declared invalid. Form AOC-2 was reported "not applicable" for seven consecutive years despite these transactions.
  2. Pledged fixed deposits and mutual fund units, ₹3,658.87 lacs by FY26, sit off-balance-sheet while reported borrowings stay at ₹0.22 crore Major - Pledged fixed deposits totaled ₹3,658.87 lacs as at 31 March 2026, comprising ₹1,775.00 lacs with exchanges and ₹1,883.87 lacs with banks. Mutual fund units of ₹471.60 lacs were pledged with Clearing Corporation as collateral. Debt Service Coverage Ratio fell from 1.10 times in FY25 to 0.58 times in FY26, attributed to higher borrowing for Margin Trading Facility.
  3. Operating cash flow collapsed to a ₹4.23 crore outflow in FY20 while the company reported a PAT of only ₹-0.33 crore Major - In FY20, operating cash flow was a ₹4.23 crore outflow against PAT of ₹-0.33 crore, a CFO/PAT ratio of 12.82x. The company extinguished 9,95,000 equity shares on 20 November 2019 in a buyback with total cash outflow of ₹716.07 lacs, funded from Share Premium and Retained Earnings. ROCE fell from 15.03% in FY17 to 0.62% in FY20.
  4. Receivables doubled in FY20 while revenue fell, and debtor-turnover disclosures swing wildly year to year Major - Trade receivables rose 93% from ₹209.03 lacs in FY19 to ₹403.11 lacs in FY20, while revenue from contracts with customers was essentially flat. Receivable days rose 109% from 64 to 133. The company attributed a debtor turnover decrease in FY2022-23 to "superior debtor management," then attributed an increase in FY2023-24 to margin funding provided to debtors.
  5. Unqualified opinions with KAMs and FY2025-26 audit-trail exception Major - SKP Securities received unqualified opinions for each year from FY2019-20 through FY2025-26, with "Pending Tax Litigations" reported as a Key Audit Matter in FY2022-23, FY2023-24, FY2024-25, and FY2025-26. The FY2025-26 auditor noted that "audit trail (edit log) not enabled at database level for accounting software," while the financial statements simultaneously stated the feature was enabled and operating throughout the year. No fraud was reported under Section 143(12) in any year.
  6. Mark-to-market investment gains drive reported profit swings and create a tax-expense mismatch Minor - Net Profit Margin decreased from 27% to 17% in FY2022-23 due to lower Fair Market Value Gain, with higher tax expense as this gain is not considered for Income Tax. The MD&A states mark-to-market valuation "can have a meaningful impact on company's bottom line, beyond reasonable control of the management, as witnessed during FY20". FY20 standalone current tax expense was ₹8.85 lacs against ₹58.45 lacs the prior year.
  7. Long-running disputed tax demands remain unchanged across at least six years Minor - As at 31 March 2026, contingent liabilities included ₹6.33 lacs for service tax (FY 2006-07 to 2008-09) and ₹6.73 lacs for income tax under appeal, unchanged from the prior year. Bank guarantees given stood at ₹500.00 lacs, down from ₹800.00 lacs. Management states no provision is considered necessary as there are fair chances of successful appeal outcomes.
  8. Statutory auditor changed once in the 10-year window due to mandatory rotation Clean - G.P. Agrawal & Co. completed its second 5-year term at the 32nd AGM held 2 July 2022 and was not eligible for reappointment. S K Agrawal and Co LLP was appointed for five consecutive years, holding office till the 37th AGM in Calendar Year 2027. CARO reports for FY2021-22 through FY2024-25 each stated "no resignation of statutory auditors during the year".
  9. No regulator penalties reported; IA registration surrendered in 2020 Clean - SKP Securities reported "no penalties/strictures" from SEBI or other authorities in the last three years in its FY2025-26 Annual Report. The company surrendered its SEBI Investment Advisor registration by letter dated 31 December 2020, citing "structural regulatory changes" making it impossible to commence business. A Certificate of Non-Disqualification dated 10 May 2025 certified none of the 8 Directors were debarred by SEBI, MCA or any statutory authority.

What to watch

Bottom line: This is a company with a clean audit opinion record and no regulator penalties, but the substance of its disclosures lags the form. The risk character is one of related-party dealings that were authorized by shareholders but lacked proper AOC-2 disclosure, and off-balance-sheet obligations that the reported numbers do not capture. Watch whether the audit-trail exception recurs, whether the related-party credit line gets proper AOC-2 disclosure, and whether the property loan charge is finally created.