Yatharth Hospital & Trauma Care Services Ltd Forensic Report - SOIC x StockScans Report

as of Sep 2026

Yatharth Hospital's record carries a clean audit opinion for FY2025-26, but that opinion sits alongside a cluster of serious disclosures: undisclosed interest-free loans to subsidiaries, an ongoing income-tax search, and a persistent audit-trail exception persisting since FY2023-24.

Key findings

  1. Yatharth repeatedly gave interest-free, open-ended loans to subsidiaries while declaring no material related-party transactions Critical - In FY2023-24, Yatharth granted loans to subsidiaries aggregating ₹260.78 crore, ₹150.51 crore to AKS Medical & Research Centre, ₹103.66 crore to Ramraja Multispeciality Hospital, ₹6.5 crore to Pristine Infratech, and ₹0.11 crore to Sanskar Medica, which the auditor stated were 100% of total loans granted and "either repayable on demand or without specifying terms/period of repayment". The FY2025-26 standalone financial statements disclose the loan to a related party is interest-free and receivable after 3 years from disbursement. Yet the Board's Report for FY2025-26 states "No materially significant related party contracts/arrangements/transactions with promoters, Directors, KMPs or relatives; Form AOC-2 not applicable". The AGM notice now seeks shareholder approval for a material related-party transaction, a loan up to ₹150 crore to subsidiary MGS Infotech, which the company itself states exceeds 10% of annual consolidated turnover.
  2. Income Tax Department searched the group in October 2023, seized cash and attached assets; attachments were released in November 2025 but appeals remain ongoing Major - The Income Tax Department conducted a search under Section 132 of the Income-tax Act in October 2023 at premises of the holding company, subsidiaries and KMPs. Cash of ₹0.86 crore was seized and a lien of ₹70.62 crore was created on a current account. The Department released all provisionally attached properties and de-froze fixed deposits pursuant to orders dated November 13, 2025. During FY2025-26, the Department issued Assessment Orders to the holding company and some subsidiaries, and the respective companies filed appeals against those orders.
  3. The group expanded rapidly through acquisitions of loss-making or pre-operational hospitals, with several subsidiaries carrying negative net worth Major - Ramraja Multispeciality Hospital, a wholly owned subsidiary, reported reserves of negative ₹45.41 crore in FY25. Pristine Infracon, acquired on March 28, 2024, reported reserves of negative ₹61.90 crore and a loss after tax of ₹17.36 crore in FY25. MGS Infotech, acquired at an enterprise value of ₹152 crore, became a 60% subsidiary on January 31, 2025, and had not commenced commercial operations as of that reporting period. Sanskar Medica filed a petition with NCLT Delhi for reduction of paid-up capital, which "when approved, would allow reduction of paid-up capital and consequently loan given to parent company Yatharth Hospital and Trauma Care".
  4. Reported debt understates the group's economic obligations through deferred payments, pledged assets, and a fresh ₹1,000 crore security-creation mandate Major - The Board approved creation of security at its meeting held April 03, 2026, for borrowings up to an aggregate limit not exceeding ₹1,000 crores, subject to member approval. Management stated in the Q1 FY27 transcript that debt increased from approximately INR 210 crores in March to approximately INR 300 crores. Deferred payment of ₹15.12 crore is payable for the Shantived acquisition as per mutually agreed terms. Property, plant and equipment and vehicles have been pledged as security as at FY2025-26.
  5. A promoter family controls the board and executive pay, with three family members each drawing ₹1.2 crore annually while median employee remuneration rose 7% Major - Dr. Ajay Kumar Tyagi (Chairman & Whole-time Director), Dr. Kapil Kumar (Managing Director), and Mr. Yatharth Tyagi (Whole-time Director, son of Dr. Ajay Kumar Tyagi and nephew of Dr. Kapil Kumar) each drew remuneration of ₹1.2 crore per annum in FY2024 and FY2025. Average increase in managerial remuneration was approximately 34% in FY2025-26, while the percentage increase in median remuneration of employees was 7%. Public Institutions voted 34.02% against the appointment of Mr. Ramesh Krishnan as Independent Director in the postal ballot concluded 17th January 2026. Promoter Dr. Kapil Kumar created a pledge on 82,01,754 shares (8.51% of total share capital) on 27th March 2025 in favour of four finance companies for a personal loan.
  6. Operating cash flow has lagged reported profits across the cycle, while the company retained all earnings and funded an increasingly expensive bed-expansion programme Major - Cumulative CFO of ₹592 crore covered only 0.55x of cumulative EBITDA of ₹1,079 crore over the ten-year history through the latest period. FY2023-24 standalone CFO was negative ₹3.08 crore against PAT of ₹114 crore, and FY2024-25 FCF was negative ₹161 crore. ROCE fell from 17.34% in FY2023-24 to 11.09% in FY2024-25 and 11.31% in FY2025-26. Management stated in Q1 FY2027 that capex per bed increased from ₹30.7 lakh to ₹61.4 lakh over three years, and that Gurugram construction is "almost a INR1 crore capex bed". The Group declared or paid no dividend in FY2022-23, FY2023-24, FY2024-25, or FY2025-26.

What to watch

Bottom line: This is a record with clean audit opinions and an unqualified internal financial controls opinion, but the substance around those opinions is heavily loaded. The core risk is related-party money movement: interest-free, open-ended loans to subsidiaries that the company simultaneously said did not exist, now followed by a request for another ₹150 crore. The auditor resignations, the tax search, and the persistent audit-trail exception all point to the same question, whether the reported numbers capture the full picture of where cash has gone and what obligations sit outside the balance sheet. Watch the two shareholder votes and the next auditor's report for the first signs of an answer.