Indraprastha Medical Corporation's audited financial record is solid: operating cash flow has covered reported profit in most years, the statutory auditor has held a stable mandate since 2017, and revenue recognition is routine. The governance layer is where the strain shows, with the recurring exceptions being the promoter's undematerialised shareholding, a fine for the non-appointment of an Independent Woman Director, and non-compliance with Regulation 17(1A) for appointing three Independent Directors aged 75 or above without prior shareholder approval.
Key findings
- A 17-year-old Supreme Court dispute over free treatment obligations remains unresolved
Minor- Claims against the company not acknowledged as debt rose from ₹49.94 crore in FY2020 to ₹105.27 crore in FY2026, with management assessing the possibility of major financial loss as remote. The dispute stems from a Delhi High Court order dated 22 September 2009 holding that free treatment under the lease deed with the Government of NCT of Delhi shall include medicines and consumables; the Supreme Court admitted the company's appeal with an interim order dated 30 November 2009, and the matter remains sub judice. The hospital building on government-leased land had a net carrying amount of ₹127.16 crore as at 31 March 2026, with ownership to be decided at a future date. - Clean capital markets record barring recurring SEBI LODR compliance exceptions
Minor- The company stated in its FY2025-26 Corporate Governance report that no non-compliance, penalty or stricture was imposed by Stock Exchange, SEBI or any statutory authority on capital markets matters in the last three years. The recurring exceptions are the promoter's undematerialised shareholding, flagged in the Secretarial Audit Reports for FY2025-26, FY2021-22 and FY2020-21, and a ₹2,60,000 fine from NSE and BSE for non-appointment of an Independent Woman Director during 1 April 2020 to 22 May 2020, which BSE waived on application. The FY2025-26 Secretarial Audit also flagged non-compliance with Regulation 17(1A) for appointing three Independent Directors aged 75 or above without prior shareholder approval. - Revenue recognition is routine, but receivables show a persistent tail of old dues
Minor- Trade receivables ageing as at 31 March 2024 shows undisputed receivables considered good of ₹68.71 crore, with ₹4.60 crore outstanding more than 3 years, against an allowance for doubtful receivables of ₹10.31 crore. The allowance grew from ₹8.53 crore as at 31 March 2023. Credit risk on trade receivables is stated to be low, with receivables mainly from insurance companies, corporate customers and government undertakings. - One material accounting transition in the period, and a labour-code liability quantified only in FY2026
Minor- On transition to Ind AS 116 effective 1 April 2019, the company recognised a right-of-use asset of ₹11.59 crore and a lease liability of ₹11.76 crore. The Code on Social Security, 2020 was disclosed as enacted but with no effective date in each annual report from FY2021 through FY2025; in FY2026, the company accounted for an incremental estimated liability upon the New Labour Codes becoming effective on 21 November 2025. - Operating cash flow covers profit, but dividends have escalated sharply
Minor- The CFO/PAT ratio was 1.61x in FY2024, 1.68x in FY2023 and 1.61x in FY2022, declining to 0.97x in FY2025 and 0.91x in FY2026. The company paid a dividend of ₹41.25 crore during FY2024-25, up from ₹27.50 crore the previous year, after declaring no dividend for FY2019-20 and FY2020-21. ROCE was 33.26% in FY2024, 35.36% in FY2025 and 34.04% in FY2026. - Statutory auditor holds a stable mandate with no adverse actions
Clean- S.N. Dhawan & Co. LLP was appointed in 2017 and re-appointed in 2022 for a second and final term through the 39th AGM in 2027, with shareholders approving the re-appointment with 99.9871% votes in favour. CARO clause (xviii) for FY2024-25 states there was no resignation of statutory auditors during the year. Total auditor fees were ₹0.34 crore for both FY2025-26 and FY2024-25.
What to watch
- Supreme Court decision on free-treatment obligations. The dispute over whether free treatment includes medicines and consumables remains pending as of the FY2025-26 Annual Report.
- Hospital building ownership. Determination of ownership between the Government of NCT of Delhi and the company per the lease agreement is pending as of the FY2025-26 Annual Report.
- Auditor transition. The second and final term of S.N. Dhawan & Co. LLP expires at the conclusion of the 39th AGM in 2027, when a new statutory auditor must be appointed.
Bottom line: This is a financially sound record, cash conversion is real, the auditor is stable, and the accounting is routine. The risk is concentrated in governance: the promoter holds shares outside the dematerialised system, and the company has drawn regulatory scrutiny for lapses in board composition. Watch whether the Delhi government fills the vacant directorships and whether the Supreme Court finally resolves the free-treatment dispute that has hung over the company for 17 years.