Vesuvius India’s record is clean on audit: seven years of unqualified opinions from Price Waterhouse. Three things sit on the disclosure side: 38.93 crore of disputed tax demands carry no provision, IT control exceptions and a leasehold-title exception have recurred in the last three years, and cumulative operating cash flow has covered only 64% of cumulative EBITDA over the decade to FY26.
Key findings
- Disputed tax demands of 38.93 crore carry no provision
Minor- Disputed tax demands outstanding as of 31 December 2025 aggregate 38.93 crore, dominated by a 27.23 crore sales tax matter for FY2008-09 to 2011-12 pending at the Sales Tax Appellate Tribunal. The company has made no provision for any of these demands, stating it is not practicable to estimate the timing of cash outflows. The company has also not provided for any potential EPFO liability arising from the retrospective application of a Supreme Court judgment. - Clean audit opinions, but IT control exceptions recurred in the last three years
Minor- The statutory auditor issued an unqualified opinion on the standalone financial statements for every year from FY2019-20 through FY2025-26. For FY2023-24, FY2024-25, and FY2025-26, the auditor flagged that daily server backups in India and a database-level audit trail were missing for part of the year. CARO reports also note a persistent leasehold-title exception for Kolkata land. - Operating cash flow lags profit, and a stalled land parcel sits in CWIP
Minor- Cumulative CFO of ₹1,135 crore covered only 64% of cumulative EBITDA of ₹1,769 crore over the 10-year period to FY26. In FY26, CFO was ₹177 crore against PAT of ₹264 crore, a ratio of 0.67x. Capital work-in-progress includes ₹9.69 crore paid for freehold land at Visakhapatnam where construction has been stalled by a buffer-zone issue, a status unchanged from FY2020 through at least FY2023. Management stated in the Q4 FY26 earnings call that the company retains cash to fund future capex rather than distributing higher dividends. - Independent Directors re-categorised as Non-Independent, with institutional dissent
Minor- Mr. Biswadip Gupta ceased as Independent Director on 24 September 2025 and was appointed as Additional Director (Non-Executive Non-Independent) the next day. Mr. Sudipto Sarkar followed the same path on 28 April 2024. Public institutional investors voted 45.38% against Mr. Sarkar’s appointment and 50.35% against another independent director appointment in November 2025. A resolution on Non-Executive Director remuneration drew 59.90% dissent from public institutions at the April 2024 AGM.
What to watch
- Sales tax demand. Resolution of the 27.23 crore demand for FY2008-09 to 2011-12 pending at the Sales Tax Appellate Tribunal, as disclosed in the FY2025-26 Annual Report.
- Income tax demands. Outcome of the 7.12 crore in income tax demands for AY 2006-07, 2019-20, 2020-21, and 2021-22 pending at the Commissioner of Income Tax (Appeals), as disclosed in the FY2025-26 Annual Report.
- Kolkata leasehold title. Resolution of the lease renewal, reported as under progress in the FY2025-26 annual report.
- Visakhapatnam land. Resolution of the buffer-zone issue with APIIC and VUDA, pending since at least FY2020.
- Capex deployment. Deployment of accumulated cash reserves into specific projects; management stated intent but provided no quantified plan as of the Q4 FY26 call.
- EPFO liability. Clarification on the retrospective application of the Supreme Court judgment in the Vivekananda Vidyamandir case, as disclosed in the FY2025-26 Annual Report.
Bottom line: This is a disclosed and consistently audited record. The risk is not in the numbers but in the gaps between them: tax demands that carry no provision, IT controls the auditor has flagged three years running, and cash conversion that trails reported profit over a full decade. Watch the stalled Visakhapatnam land and the sales tax appeal for signs of whether these open items resolve or persist.