Integrated Filing — IndAS



General information about company

Scrip Code 541578
NSE Symbol VARROC
MSEI Symbol NOTLISTED
ISIN INE665L01035
Name of company VARROC ENGINEERING LIMITED
Type of company Main Board
Class of security Equity
Date of start of financial year 01-04-2025
Date of end of financial year 31-03-2026
Date of board meeting when results were approved 12-11-2025
Date on which prior intimation of the meeting for considering financial results was informed to the exchange 04-11-2025
Description of presentation currency INR
Level of rounding used in financial results Lakhs
Reporting Type Quarterly
Reporting Quarter Second quarter
Nature of report standalone or consolidated Consolidated
Whether results are audited or unaudited for the quarter ended Unaudited
Whether results are audited or unaudited for the Year to date for current period ended/year ended Unaudited
Segment Reporting Multi segment
Description of single segment
Start date and time of board meeting 12-11-2025   12:30:00
End date and time of board meeting 12-11-2025   15:00:00
Whether cash flow statement is applicable on company Yes
Type of cash flow statement Cash Flow Indirect
Declaration of unmodified opinion or statement on impact of audit qualification Not applicable



Financial Results Ind-AS

Amount in (Lakhs)

Particulars 3 months/ 6 months ended (dd-mm-yyyy) Year to date figures for current period ended (dd-mm-yyyy)
A Date of start of reporting period 01-07-2025 01-04-2025
B Date of end of reporting period 30-09-2025 30-09-2025
C Whether results are audited or unaudited Unaudited Unaudited
D Nature of report standalone or consolidated Consolidated Consolidated
1 Income
Revenue from operations 2,20,733.80 4,23,488.90
Other income 265.80 771.70
Total income 2,20,999.60 4,24,260.60
2 Expenses
(a) Cost of materials consumed 1,43,289.60 2,70,413.40
(b) Purchases of stock-in-trade 0.00 0.00
(c) Changes in inventories of finished goods, work-in-progress and stock-in-trade (1,187.00) (1,185.30)
(d) Employee benefit expense 24,947.60 49,070.60
(e) Finance costs 3,185.50 6,817.50
(f) Depreciation, depletion and amortisation expense 8,258.50 16,368.10
(f) Other Expenses
1 Foreign exchange gain (net) (116.20) (384.20)
2 Consumption of Stores, Spares and Tools 2,503.40 4,997.10
3 Consumption of Packing Material 2,697.70 4,907.00
4 Water and Electricity Charges 5,525.80 10,560.80
5 Contract Labour Cost 6,947.00 13,753.40
6 Freight and Forwarding Expenses 2,938.20 5,859.60
7 Legal and Professional Fees 2,318.90 4,572.10
8 Other Expenses 10,572.00 21,170.50
Total other expenses 33,386.80 65,436.30
Total expenses 2,11,881.00 4,06,920.60
3 Total profit before exceptional items and tax 9,118.60 17,340.00
4 Exceptional items 0.00 6,119.40
5 Total profit before tax 9,118.60 23,459.40
6 Tax expense
7 Current tax 390.60 883.90
8 Deferred tax 2,485.30 5,644.90
9 Total tax expenses 2,875.90 6,528.80
10 Net movement in regulatory deferral account balances related to profit or loss and the related deferred tax movement 0.00 0.00
11 Net Profit Loss for the period from continuing operations 6,242.70 16,930.60
12 Profit (loss) from discontinued operations before tax 0.00 0.00
13 Tax expense of discontinued operations 0.00 0.00
14 Net profit (loss) from discontinued operation after tax 0.00 0.00
15 Share of profit (loss) of associates and joint ventures accounted for using equity method 83.60 137.70
16 Total profit (loss) for period 6,326.30 17,068.30
17 Other comprehensive income net of taxes 1,141.80 (3,154.00)
18 Total Comprehensive Income for the period 7,468.10 13,914.30
19 Total profit or loss, attributable to
Profit or loss, attributable to owners of parent 6,095.10 16,601.30
Total profit or loss, attributable to non-controlling interests 231.20 467.00
20 Total Comprehensive income for the period attributable to
Comprehensive income for the period attributable to owners of parent 7,236.90 13,447.30
Total comprehensive income for the period attributable to owners of parent non-controlling interests 231.20 467.00
21 Details of equity share capital
Paid-up equity share capital 1,527.90 1,527.90
Face value of equity share capital 1 1
27 Details of debt securities
22 Reserves excluding revaluation reserve
23 Earnings per share
i Earnings per equity share for continuing operations
Basic earnings (loss) per share from continuing operations 3.99 10.87
Diluted earnings (loss) per share from continuing operations 3.99 10.87
ii Earnings per equity share for discontinued operations
Basic earnings (loss) per share from discontinued operations 0 0
Diluted earnings (loss) per share from discontinued operations 0 0
ii Earnings per equity share
Basic earnings (loss) per share from continuing and discontinued operations 3.99 10.87
Diluted earnings (loss) per share from continuing and discontinued operations 3.99 10.87
24 Debt equity ratio 0.42 0.42
25 Debt service coverage ratio 3.02 2.42
26 Interest service coverage ratio 6.48 5.96
27 Disclosure of notes on financial results Textual Information(1)



Disclosure of notes on financial results

Textual Information(1) 1. The above results were reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on November 12, 2025 and were subjected to review by the Statutory Auditors. 2. The Group received a settlement offer from an overseas party alleging breach of agreement in respect of certain income received by the Group recognised under Revenue from operations (Rs. 209.89 million during the quarter ended June 30, 2025 and Rs. 231.82 million during the year ended March 31, 2025). The Group believes that it has a strong case and will take appropriate actions as necessary to protect its interests. The auditors in their review report have included a qualification in respect of this matter. 3. On July 7, 2025, the Group received an intimation from ICC International Court of Arbitration with respect to a Request for Arbitration initiated by OPmobility Lighting Holding, France (Erstwhile PO Lighting Systems). The request pertains to certain alleged breaches of covenants under the Securities Purchase Agreement executed between the parties on April 29, 2022, and subsequently amended on October 5, 2022, May 12, 2023, and June 15, 2023. Claims in respect of some of the breaches have been quantified at US$ 66.41 million plus legal costs while for others no quantification has been provided. The Group is evaluating the matter and exploring legal and contractual remedies. It intends to contest the claims and take appropriate steps to protect its interests. Based on a legal opinion obtained, the Group believes that it has grounds to defend against the said allegations and accordingly no provision has been considered in respect of this matter in these results. 4. Pursuant to provisions of Section 230-232 of the Companies Act, 2013, the Board of Directors of the Company on May 17, 2024 had approved the scheme of amalgamation of Varroc Polymers Limited ('VPL') (a wholly owned subsidiary of the Holding Company) with Varroc Engineering Limited ('VEL') (the Holding Company) with appointed date of April 01,2024 ('the Scheme'). National Company Law Tribunal ('NCLT') approved the above scheme vide its order dated January 10, 2025 and the merger became effective on February 01,2025 on filing of the NCLT order with the Registrar of Companies. The merger has been accounted as business combination of entities under common control as per Appendix C to Ind AS 103- Business Combinations. The aforesaid scheme has no impact on the Consolidated Financial Results of the Group since the scheme of merger was between the Holding Company and its wholly owned subsidiary, except for tax expense for the quarter ended September 30, 2024 and half year ended September 30, 2024 which has been restated to include the effects of this merger. 5. Exceptional items for the periods presented in the consolidated results include following: a. On December 11, 2024, the Group received an order from ICC International Court of Arbitration ('ICC') in respect of the ongoing arbitration between Varroc Corp Holding B.V. ('VCHBV') jointly with Varroc Engineering Limited and Beste Motor Co. Ltd. ('TYC BVI Entity') jointly with TYC Brother Industrial Co. Ltd ('TYC Group') and Varroc TYC Corporation ('VTYC' or 'China JV'), wherein VCHBV has been directed to transfer its 50% shareholding in VTYC to TYC BVI Entity for a consideration of RMB 310.50 million. Accordingly, the Group assessed that its investment in VTYC (a joint venture accounted for under the equity method) satisfies the criteria prescribed under Ind AS 105 'Non-Current Assets Held for Sale and Discontinued Operations' for classification as 'Assets held for sale' and had written down this investment to Rs. 3,395.15 million which is its fair value less costs to sell. The resulting estimated impairment loss of Rs. 806.82 million for the year ended March 31, 2025 was disclosed as an Exceptional item in the financial results. The Group received above consideration on May 07, 2025 and transferred its investments in China JV. On account of such disposal, the cumulative exchange gains pertaining to China JV of Rs. 611.94 million, which had been recognised in Other Comprehensive Income and accumulated in foreign currency translation reserve during the previous periods, have been reclassified to the Statement of Profit or Loss. These have been disclosed as an exceptional item and reduced from Other Comprehensive Income for the quarter ended June 30, 2025 and half year ended September 30, 2025. b. On April 21, 2025, the Group received final order from ICC in respect of the above arbitration wherein the Group was directed to pay to TYC Group legal costs pertaining to the arbitration incurred by TYC Group amounting to Rs. 439.91 million. The group recognised a provision for this cost as at March 31, 2025 and the same was disclosed as an Exceptional item in the financial results for the year ended March 31, 2025. c. Exceptional item also included estimated expenses directly attributable to merger of VPL with the Company amounting to Rs. 196.02 million for the year ended March 31, 2025. d. KTM AG group, one of the customer of the Group, filed for insolvency and the Court admitted restructuring with self-administration in Austria. Considering these developments, the Group recognised a provision for expected credit loss of trade receivables of KTM AG Group amounting to Rs. 30.62 million in the year ended March 31, 2025. 6.a) On November 5, 2024, the Group received a GST Order from Additional Commissioner of CGST & Central Excise for appropriation of GST dues amounting to Rs. 629 million along with equivalent penalty and applicable interest relating to inappropriate classification of certain goods supplied during the period from July 1, 2017 to September 30, 2023. The Group has paid the principal demand, however considering merits of the case, management believes that it has grounds to successfully defend and litigate the GST Order with respect to applicable interest and penalty for the aforementioned period. The Group has initiated appellate proceedings against this GST Order, pending conclusion of which no adjustments have been made in respect of this matter in the financial results for the quarter and half year ended September 30, 2025. b) On January 03, 2025, the Group received a GST Order from Commercial Tax Officer (Divisional GST office, Karnataka) consisting of demand for GST dues amounting to Rs. 0.03 million along with interest of Rs. 302.67 million and penalty of Rs. 564.19 million relating to inappropriate classification of certain goods supplied during the period from July 1, 2017 to September 30, 2023. The Group has paid the principal demand, however, considering merits of the case, management believes that it has grounds to successfully defend and litigate the GST Order with respect to the interest and penalty for the aforementioned period. The Group has initiated appellate proceedings against this GST Order, pending conclusion of which no adjustments have been made in respect of this matter in the financial results for the quarter and half year ended September 30, 2025. 7. During the year ended March 31, 2024, the Company issued 25,000 number of listed Non-Convertible Debentures ('NCD') of face value of Rs. 1,00,000 each aggregating to Rs. 2,500 million on a private placement basis. The NCDs are repayable in 16 equal quarterly instalments beginning from December 07, 2024. Further, NCD holders have a put option after 30 months and 42 months respectively from date of allotment, requiring the Company to redeem all the NCDs. The Company shall at all times until the Final Settlement Date maintain a minimum Security Cover of at least 1.1 x. The proceeds from the issue have been utilised for repayment of existing listed NCDs, other outstanding debt and for general corporate purposes. These NCDs are secured by exclusive charge by way of hypothecation on the specific identified movable properties of the Company. The asset cover in respect of the Non-Convertible Debentures as on September 30, 2025 is 1.95 times of the total due amount which is higher than the requirement of 1.10 times as specified in the Debenture Trust Deed. 8. The 'Automotive' segment consists of the business of automobile products consisting of auto parts for two-wheelers, three-wheelers and four-wheelers and related design, development and engineering activities and other services. 'Others' comprise of forging components for off road vehicles and components for mining and oil drilling industry which is below the thresholds for reporting as separate operating segment. Investment in joint ventures and corresponding share of profit/loss from joint ventures is considered under unallocated assets and profit/loss respectively.



Remarks

Debt equity ratio
Debt service coverage ratio
Interest service coverage ratio


Statement of Asset and Liabilities

Amount in (Lakhs)

Particulars Year ended (dd-mm-yyyy)
Date of start of reporting period 01-04-2025
Date of end of reporting period 30-09-2025
Whether results are audited or unaudited Unaudited
Nature of report standalone or consolidated Consolidated
Assets
1 Non-current assets
Property, plant and equipment 2,05,104.20
Capital work-in-progress 11,531.90
Investment property 0.00
Goodwill 4,843.60
Other intangible assets 3,949.80
Intangible assets under development 2,572.30
Biological assets other than bearer plants 0.00
Investments accounted for using equity method 1,839.80
Non-current financial assets
Non-current investments 656.70
Trade receivables, non-current 0.00
Loans, non-current 0.00
Other non-current financial assets 4,870.80
Total non-current financial assets 5,527.50
Deferred tax assets (net) 3,152.10
Other non-current assets 8,374.40
Total non-current assets 2,46,895.60
2 Current assets
Inventories 86,640.30
Current financial asset
Current investments 5,425.50
Trade receivables, current 72,351.20
Cash and cash equivalents 12,252.00
Bank balance other than cash and cash equivalents 16,871.00
Loans, current 34.80
Other current financial assets 1,460.30
Total current financial assets 1,08,394.80
Current tax assets (net) 0.00
Other current assets 35,398.00
Total current assets 2,30,433.10
3 Non-current assets classified as held for sale 0.00
4 Regulatory deferral account debit balances and related deferred tax Assets 0.00
Total assets 4,77,328.70
Equity and liabilities
1 Equity
Equity attributable to owners of parent
Equity share capital 1,527.90
Other equity 1,66,897.90
Total equity attributable to owners of parent 1,68,425.80
Non controlling interest 3,754.20
Total equity 1,72,180.00
2 Liabilities
Non-current liabilities
Non-current financial liabilities
Borrowings, non-current 22,822.10
Trade payables, non-current
(A) Total outstanding dues of micro enterprises and small enterprises 0.00
(B) Total outstanding dues of creditors other than micro enterprises and small enterprises 0.00
Total Trade payable 0.00
Other non-current financial liabilities 15,938.10
Total non-current financial liabilities 38,760.20
Provisions, non-current 1,966.80
Deferred tax liabilities (net) 429.50
Deferred government grants, Non-current 2,613.90
Other non-current liabilities 0.00
Total non-current liabilities 43,770.40
Current liabilities
Current financial liabilities
Borrowings, current 49,728.10
Trade payables, current
(A) Total outstanding dues of micro enterprises and small enterprises 30,110.30
(B) Total outstanding dues of creditors other than micro enterprises and small enterprises 1,22,537.00
Total Trade payable 1,52,647.30
Other current financial liabilities 34,362.50
Total current financial liabilities 2,36,737.90
Other current liabilities 21,179.10
Provisions, current 2,409.30
Current tax liabilities (Net) 172.90
Deferred government grants, Current 879.10
Total current liabilities 2,61,378.30
3 Liabilities directly associated with assets in disposal group classified as held for sale
4 Regulatory deferral account credit balances and related deferred tax liability
Total liabilities 3,05,148.70
Total equity and liabilites 4,77,328.70
Disclosure of notes on assets and liabilities



Format for Reporting Segment wise Revenue, Results and Capital Employed along with the company results

Amount in (Lakhs)

Particulars 3 months/ 6 month ended (dd-mm-yyyy) Year to date figures for current period ended (dd-mm-yyyy)
Date of start of reporting period 01-07-2025 01-04-2025
Date of end of reporting period 30-09-2025 30-09-2025
Whether results are audited or unaudited Unaudited Unaudited
Nature of report standalone or consolidated Consolidated Consolidated
1 Segment Revenue (Income)
(net sale/income from each segment should be disclosed)
1 Automotive 2,15,798.00 4,13,034.00
2 Others 4,935.80 10,454.90
Total Segment Revenue 2,20,733.80 4,23,488.90
Less: Inter segment revenue 0.00 0.00
Revenue from operations 2,20,733.80 4,23,488.90
2 Segment Result
Profit (+) / Loss (-) before tax and interest from each segment
1 Automotive 12,972.70 25,388.70
2 Others (994.60) (1,854.00)
Total Profit before tax 11,978.10 23,534.70
i. Finance cost 3,185.50 6,817.50
ii. Other Unallocable Expenditure net off Unallocable income (409.60) (6,879.90)
Profit before tax 9,202.20 23,597.10
3 (Segment Asset - Segment Liabilities)
Segment Asset
1 Automotive 4,20,256.30 4,20,256.30
2 Others 22,514.90 22,514.90
Total Segment Asset 4,42,771.20 4,42,771.20
Un-allocable Assets 34,557.50 34,557.50
Net Segment Asset 4,77,328.70 4,77,328.70
4 Segment Liabilities
Segment Liabilities
1 Automotive 2,25,755.90 2,25,755.90
2 Others 5,390.60 5,390.60
Total Segment Liabilities 2,31,146.50 2,31,146.50
Un-allocable Liabilities 74,002.20 74,002.20
Net Segment Liabilities 3,05,148.70 3,05,148.70
Disclosure of notes on segments



Other Comprehensive Income

Amount in (Lakhs)

Particulars 3 months/ 6 months ended (dd-mm-yyyy) Year to date figures for current period ended (dd-mm-yyyy)
A Date of start of reporting period 01-07-2025 01-04-2025
B Date of end of reporting period 30-09-2025 30-09-2025
C Whether results are audited or unaudited Unaudited Unaudited
D Nature of report standalone or consolidated Consolidated Consolidated
Other comprehensive income [Abstract]
1 Amount of items that will not be reclassified to profit and loss
1 Remeasurement of defined benefit obligation (net of tax) 0 0
Total Amount of items that will not be reclassified to profit and loss 0.00 0.00
2 Income tax relating to items that will not be reclassified to profit or loss 0.00 0.00
3 Amount of items that will be reclassified to profit and loss
1 Net movement on effective portion of Cash Flow Hedges (net of tax) -21000000 -49260000
2 Exchange differences in translating the financial statements of foreign operations (refer note 5a) 135180000 -266140000
Total Amount of items that will be reclassified to profit and loss 1,141.80 (3,154.00)
4 Income tax relating to items that will be reclassified to profit or loss 0.00 0.00
5 Total Other comprehensive income 1,141.80 (3,154.00)



Cash flow statement, indirect

Amount in (Lakhs)

Particulars Year ended (dd-mm-yyyy)
A Date of start of reporting period 01-04-2025
B Date of end of reporting period 30-09-2025
C Whether results are audited or unaudited Unaudited
D Nature of report standalone or consolidated Consolidated
Statement of cash flows
Cash flows from used in operating activities
Profit before tax 23,459.40
Adjustments for reconcile profit (loss)
Adjustments for finance costs 6,817.50
Adjustments for decrease (increase) in inventories (11,734.50)
Adjustments for decrease (increase) in trade receivables, current (2,698.20)
Adjustments for decrease (increase) in trade receivables, non-current 0.00
Adjustments for decrease (increase) in other current assets (678.90)
Adjustments for decrease (increase) in other non-current assets 0.00
Adjustments for other financial assets, non-current 0.00
Adjustments for other financial assets, current 0.00
Adjustments for other bank balances 0.00
Adjustments for increase (decrease) in trade payables, current 12,245.20
Adjustments for increase (decrease) in trade payables, non-current 0.00
Adjustments for increase (decrease) in other current liabilities 1,395.90
Adjustments for increase (decrease) in other non-current liabilities 0.00
Adjustments for depreciation and amortisation expense 16,368.10
Adjustments for impairment loss reversal of impairment loss recognised in profit or loss 0.00
Adjustments for provisions, current 0.00
Adjustments for provisions, non-current 0.00
Adjustments for other financial liabilities, current 0.00
Adjustments for other financial liabilities, non-current 0.00
Adjustments for unrealised foreign exchange losses gains (384.20)
Adjustments for dividend income 0.20
Adjustments for interest income 654.90
Adjustments for share-based payments 0.00
Adjustments for fair value losses (gains) 0.00
Adjustments for undistributed profits of associates 0.00
Other adjustments for which cash effects are investing or financing cash flow (82.30)
Other adjustments to reconcile profit (loss) 0.60
Other adjustments for non-cash items (6,119.40)
Share of profit and loss from partnership firm or association of persons or limited liability partnerships 0.00
Total adjustments for reconcile profit (loss) 14,474.70
Net cash flows from (used in) operations 37,934.10
Dividends received 0.00
Interest paid 0.00
Interest received 0.00
Income taxes paid (refund) 1,348.00
Other inflows (outflows) of cash 0.00
Net cash flows from (used in) operating activities 36,586.10
Cash flows from used in investing activities
Cash flows from losing control of subsidiaries or other businesses 0.00
Cash flows used in obtaining control of subsidiaries or other businesses 0.00
Other cash receipts from sales of equity or debt instruments of other entities 0.00
Other cash payments to acquire equity or debt instruments of other entities 0.00
Other cash receipts from sales of interests in joint ventures 34,066.40
Other cash payments to acquire interests in joint ventures 0.00
Cash receipts from share of profits of partnership firm or association of persons or limited liability partnerships 0.00
Cash payment for investment in partnership firm or association of persons or limited liability partnerships 0.00
Proceeds from sales of property, plant and equipment 447.30
Purchase of property, plant and equipment 21,685.70
Proceeds from sales of investment property 0.00
Purchase of investment property 0.00
Proceeds from sales of intangible assets 0.00
Purchase of intangible assets 2,655.70
Proceeds from sales of intangible assets under development 0.00
Purchase of intangible assets under development 0.00
Proceeds from sales of goodwill 0.00
Purchase of goodwill 0.00
Proceeds from biological assets other than bearer plants 0.00
Purchase of biological assets other than bearer plants 0.00
Proceeds from government grants 0.00
Proceeds from sales of other long-term assets 0.00
Purchase of other long-term assets 0.00
Cash advances and loans made to other parties 0.00
Cash receipts from repayment of advances and loans made to other parties 0.00
Cash payments for future contracts, forward contracts, option contracts and swap contracts 0.00
Cash receipts from future contracts, forward contracts, option contracts and swap contracts 0.00
Dividends received 0.20
Interest received 625.20
Income taxes paid (refund) 0.00
Other inflows (outflows) of cash (13,274.30)
Net cash flows from (used in) investing activities (2,476.60)
Cash flows from used in financing activities
Proceeds from changes in ownership interests in subsidiaries 0.00
Payments from changes in ownership interests in subsidiaries 0.00
Proceeds from issuing shares 0.00
Proceeds from issuing other equity instruments 0.00
Payments to acquire or redeem entity's shares 0.00
Payments of other equity instruments 0.00
Proceeds from exercise of stock options 0.00
Proceeds from issuing debentures notes bonds etc 0.00
Proceeds from borrowings 5,000.00
Repayments of borrowings 28,591.90
Payments of lease liabilities 2,369.50
Dividends paid 1,527.90
Interest paid 6,081.60
Income taxes paid (refund) 0.00
Other inflows (outflows) of cash 0.00
Net cash flows from (used in) financing activities (33,570.90)
Net increase (decrease) in cash and cash equivalents before effect of exchange rate changes 538.60
Effect of exchange rate changes on cash and cash equivalents
Effect of exchange rate changes on cash and cash equivalents 565.70
Net increase (decrease) in cash and cash equivalents 1,104.30
Cash and cash equivalents cash flow statement at beginning of period 11,147.70
Cash and cash equivalents cash flow statement at end of period 12,252.00