Alps Industries Limited — Important, 28-06-2025: Disclosure of material issue

Alps Industries Ltd. has announced a board meeting regarding the financial results for the quarter and half-year. The company continues to face significant financial stress highlighted by a qualified audit opinion due to non-provision of liability on waived interest and part of principal loans amounting to Rs. 21,291.7 Cr. This stems from the revocation of an earlier debt restructuring scheme consent by lenders holding more than 83% of secured debt.

The company is currently under the Corporate Insolvency Resolution Process (CIRP) following admission of an insolvency petition by the National Company Law Tribunal (NCLT). Edelweiss Asset Reconstruction Company Ltd. (EARC), holding over 99% secured debt, initiated the process and has filed a claim exceeding Rs. 6,11,939.59 lakh. The Interim Resolution Professional (IRP) appointed by NCLT is managing the company now.

Despite the insolvency proceedings, Alps Industries is being maintained as a going concern with ongoing discussions for a revised settlement/resolution plan with lenders. Financial statements have been prepared on this basis without provisions for the disputed liabilities. The impact of the resolution plan, once approved by the Committee of Creditors and NCLT, will be reflected in future financials.

**Issue:**

- Large contingent liability due to unpaid interest and waived loans not accounted, causing qualified audit opinion.

- Insolvency proceedings initiated, creating uncertainty over financial stability and future operations.

**Possible impact:**

- Significant erosion of net worth and shareholder value reflected in heavy losses and negative equity.

- Potential dilution or alteration of creditor claims post-resolution plan affecting current debt structure.

- Share price pressure due to ongoing insolvency and operational risks.

**Company response:**

- Engaged in CIRP with IRP managing operations aiming to resolve dues through a structured settlement.

- Continues to present accounts on a going concern basis, reflecting confidence in upcoming restructuring approval.

- Financial impact of finalized resolution plan will be incorporated only once approved by the NCLT.

Investors should monitor updates on the resolution plan approval and lender negotiations for clarity on the company’s turnaround prospects and impact on investment value.