KDDL Ltd Forensic Report - SOIC x StockScans Report

as of Aug 2026

KDDL's record carries ten consecutive clean audit opinions, and the auditor transition at the 44th AGM was routine, with the appointment passing with 99.963% of valid votes in favour. But the clean opinions sit alongside a recurring set of exceptions: shareholder deposits have grown every year for six years and now exceed all bank term loans, the promoter-chairman's pay has needed special approval every year since FY2021-22, and cash generation has repeatedly fallen short of reported profit.

Key findings

  1. Shareholder and director deposits now exceed all bank term loans Major - Deposits from shareholders and directors rose every year from 25.87 crore at 31 March 2021 to 53.8 crore at 31 March 2026, at interest rates of 8.00%-9.75%. That balance exceeds the combined Bajaj Finance term loans of 32.79 crore and working capital borrowings of 5.08 crore. Shareholder approval was sought at every AGM from FY2019-20 through FY2025-26, and dissent on the resolution rose from 0.05% at the 2021 AGM to 9.32% at the 2025 AGM, the highest of any resolution that year.
  2. Ten clean opinions mask recurring audit-trail, unaudited subsidiary, and title-deed exceptions Major - KDDL received unqualified opinions on both standalone and consolidated statements for each year from FY2020 to FY2026. Yet the FY2026 standalone report carries a Section 143(3)(b) exception on the audit trail (edit log), which was not enabled at database level in FY2026, continuing a pattern from FY2025 and FY2024. The FY2026 consolidated report also states 10 subsidiaries were not audited by the principal auditor, with total assets of ₹58,544 lacs and a net loss of ₹2,333 lacs, and a CARO qualification on a ₹5.67 lakh leasehold land at Parwanoo persisted for three years, FY2022 through FY2024.
  3. Promoter-chairman's pay has required special approval every year since FY2021-22 Major - Mr. Yashovardhan Saboo received one-time incentive payouts requiring special resolutions in each of FY2021-22 (₹1,900 lacs), FY2022-23 (₹188 lacs), FY2023-24 (₹106.08 lacs), FY2024-25 (₹43.12 lacs), and FY2025-26 (₹61.71 lacs), all over and above shareholder-approved remuneration. The ₹1,900 lacs award drew 8.42% dissent, the highest of any resolution in the dossier. The scrutinizer's report noted that interested-party non-voting rules were not taken into account, a note repeated across four meetings from 2022 to 2026.
  4. Related-party flows run through Swiss subsidiaries and promoter-group entities Major - Pylania SA and KIH converted loans into equity of Estima AG during FY2025-26, while Pylania and KIH waived subordinated loans of CHF 0.24 crore and CHF 0.43 crore respectively. Share application money of 20.26 crore was advanced for 1,89,480 shares of Ethos Lifestyle Private Limited from a promoter-group individual as at 31 March 2026. A consultancy agreement between Pylania AG and Pieth & Partners GmbH, acting through Mr. Hanspeter Pieth, proposed to be appointed as director, runs three years from 26 January 2026 at CHF 1,80,000 per annum plus a variable fee up to CHF 40,000.
  5. The subsidiary web has been reshaped through stake sales and a new 80%-owned entity Major - KDDL's stake in material subsidiary Ethos Limited fell from 75.08% at 31 March 2021 to 50.12% at 31 March 2025. Artisan Watch Products Private Limited was incorporated 19 March 2025 as an 80% subsidiary, with Mr. Yashovardhan Saboo holding the remaining 20%. The Form AOC-1 subsidiary and associate tables in the FY2025-26 Annual Report are fully populated with financial data for 12 subsidiaries and 1 associate/joint venture.
  6. Reported profit has been repeatedly shaped by one-off gains and policy choices Major - Standalone PBT fell from ₹254.01 crore in FY2023-24 to ₹58.97 crore in FY2024-25, with the prior year including a one-time exceptional gain of ₹1,937.7 crore from sale of assets. Operational EBITDA declined 13% from ₹103.1 crore to ₹89.7 crore in FY2024-25, with the adjusted margin contracting from 28.7% to 23.4%. Return on net worth fell from 64.0% to 17.7%, but on a core operational basis moderated from 36.0% to 18.1%.
  7. Cash generation has repeatedly fallen short of reported profit Major - Cumulative CFO/EBITDA for the 10 years to FY2026 was 0.38x, and CFO/PAT was -0.03x in FY25 (CFO -₹4.26 crore vs PAT ₹142 crore). The company bought back 2,37,837 shares for 88 crore, extinguished 23 September 2024, funded from securities premium and retained earnings. The current ratio fell from 2.02 times to 1.39 times in FY2024-25, reflecting use of prior-year cash from investment sales towards the buyback and subsidiary investments.
  8. Impairment indicators on foreign subsidiaries persist, with no further impairment taken Major - KDDL recognised a ₹19.58 crore impairment in FY2023-24 on investments in Kamla International Holdings SA and Pylania SA. As at 31 March 2025, a DCF-based assessment with a 6.27% pre-tax discount rate concluded no further adjustments were required. For FY2025-26, impairment indicators were identified for Estima AG's PPE of 41.78 crore, but the recoverable amount was assessed higher, so no impairment was taken.
  9. Statutory auditor rotation was routine and clean Clean - S.R. Batliboi & Co. LLP served a full five-year term until the 44th AGM on 27 September 2024, when Walker Chandiok & Co. LLP was appointed for five years. The appointment passed with 99.963% of valid votes in favour. CARO reports from FY2020-21 through FY2025-26 each state no resignation of statutory auditors during the year.

What to watch

Bottom line: This is a company with a clean audit opinion streak and a properly executed auditor rotation, but the record underneath carries recurring exceptions. The risk character is one of accumulated approvals and exceptions, deposits that keep growing, pay that keeps needing special votes, and cash that keeps falling short of profit. Watch the 15 September 2026 AGM votes and the next audit report for whether these patterns continue.