💰 Financial Performance

Revenue Growth by Segment

Total Income from Operations for Q2 FY26 (ended Sept 30, 2025) was INR 3.40 lakhs, representing a 35.97% decline compared to INR 5.31 lakhs in Q1 FY26. The company operates in a single reportable segment (Ceramic Tiles), making segment-wise growth identical to overall growth.

Geographic Revenue Split

Not disclosed in available documents; however, the company is based in Hyderabad and its plant is located in Yanam, suggesting a primary focus on the Indian domestic market.

Profitability Margins

The company reported a Net Loss of INR 3.14 lakhs in Q2 FY26 compared to a Net Profit of INR 1.23 lakhs in Q1 FY26. For the full year ended March 31, 2025, the company incurred cash losses of INR 180.33 lakhs, an improvement from the INR 564.73 lakhs loss in the preceding year (a 68% reduction in cash loss).

EBITDA Margin

Operating Loss before working capital changes for the year ended March 31, 2025, was INR 769.49 lakhs, which widened by 133.28% from a loss of INR 329.86 lakhs in the previous year. This indicates that core operations are not yet self-sustaining during the revival phase.

Capital Expenditure

Purchase of Assets (including Capital Advances) was INR 16.05 lakhs for the year ended March 31, 2025, compared to INR 242.14 lakhs in the previous year, representing a 93.37% decrease as the company focuses on reviving existing assets rather than new expansion.

Credit Rating & Borrowing

Long-term borrowings stood at INR 8,358.57 lakhs as of March 31, 2025, up 18.52% from INR 7,052.57 lakhs. The company relies heavily on unsecured loans from Directors and Body Corporates, for which interest has not been provided, masking the true cost of debt.

⚙️ Operational Drivers

Raw Materials

Cost of Materials Consumed was INR 1,267.32 lakhs for the half-year ended September 30, 2025, representing 50.43% of total expenses (INR 2,512.82 lakhs). Specific material names like clay or feldspar are not explicitly listed but are standard for ceramic tile production.

Key Suppliers

Not disclosed in available documents; however, the company has outstanding dues to Micro, Small and Medium Enterprises (MSME) for which interest on overdue amounts exceeding 15 days has not been provided.

Capacity Expansion

The company is currently in the process of reviving its operations following a long-term lockout since January 31, 2012. Current installed capacity is not specified, but fixed assets are disclosed at a book value of INR 48.45 lakhs after scrapping certain machinery.

Raw Material Costs

Raw material costs for the half-year ended Sept 2025 were INR 1,267.32 lakhs. The company is managing costs through a revival strategy, but auditors noted that inventory valuation (INR 3,227.55 lakhs) could not be verified for accuracy, potentially impacting reported material costs.

Manufacturing Efficiency

Capacity utilization is likely low as the company is 'still in the process of reviving its operations.' Depreciation and amortization expenses were INR 194.46 lakhs for the half-year, reflecting the aging of the plant and machinery.

📈 Strategic Growth

Expected Growth Rate

7.10%

Growth Strategy

The company is pursuing a revival strategy to restart its manufacturing facilities that were locked out in 2012. Growth is expected to be driven by the initiation of business activities which have already started resulting in revenue and cash flows. The strategy relies on funding via loans from directors (INR 1,306 lakhs in FY25) to bridge operational gaps.

Products & Services

Ceramic tiles, specifically marketed under the brand 'Regency Natural Tiles'.

Brand Portfolio

Regency Natural Tiles.

Market Expansion

The company is focusing on restarting its primary manufacturing unit to re-enter the ceramic tile market; specific target regions beyond the existing footprint are not mentioned.

🌍 External Factors

Industry Trends

The Indian ceramic industry is benefiting from a government push on capital expenditure and a robust services trade surplus. However, the company is currently lagging behind industry peers due to its 13-year operational hiatus.

Competitive Landscape

The company faces stiff competition from established players in the ceramic tile sector who have maintained technological parity while Regency was under lockout.

Competitive Moat

The company lacks a current sustainable moat due to its negative net worth and operational status; however, its historical brand presence in 'Natural Tiles' is the primary asset being leveraged for the revival.

Macro Economic Sensitivity

The company is sensitive to India's Gross Fixed Capital Formation (GFCF) growth, which was 7.1% for the year, as ceramic tile demand is directly linked to construction and infrastructure investment.

⚖️ Regulatory & Governance

Industry Regulations

The company is subject to the Companies Act, 2013 and SEBI (LODR) Regulations. It is currently non-compliant with Ind AS-19 regarding 'Employee Benefits' (Gratuity and Leave Encashment) and has not provided for interest under the MSMED Act.

Taxation Policy Impact

The company has not provided for tax expenses due to ongoing losses; however, it has not provided for liability towards interest and penalties on old statutory dues, which poses a regulatory risk.

Legal Contingencies

The company has disclosed pending litigations in Note 29 of its financial statements. While the exact INR value is not in the snippet, the auditors have highlighted this as a factor impacting the financial position.

⚠️ Risk Analysis

Key Uncertainties

There is a 'Material Uncertainty relating to GOING CONCERN' due to the total erosion of net worth (Other Equity at INR -9,272.39 lakhs). The company's ability to continue depends on the success of its revival plan and continued support from directors.

Geographic Concentration Risk

High concentration risk as operations are centered around a single manufacturing plant in Yanam/Hyderabad region.

Third Party Dependencies

High dependency on Directors for financing, with INR 1,306.00 lakhs in loans provided in FY25 to sustain operations.

Technology Obsolescence Risk

Significant risk as the plant was under lockout since 2012; fixed assets are disclosed at book value after scrapping some machinery, suggesting potential technological gaps compared to modern competitors.

Credit & Counterparty Risk

High risk as auditors were unable to obtain confirmation of balances from debtors, and the company has not provided for potential bad debts or employee benefit liabilities.