Reliance Naval and Engineering widens Q1 loss to Rs 371 crore

Reliance Naval and Engineering widened its consolidated loss to Rs 371 crore in the April to June quarter of 2019-20 as compared to Rs 361 crore in the year-ago period, the company said on Saturday.

The firm's consolidated income declined to Rs 26.85 crore from Rs 37.31 crore in the year-ago period, it said in a statement.

Reliance Naval and Engineering is the first private sector company in India to obtain the licence and contract to build warships.

According to the company's website, its activities include naval shipbuilding, oil and gas, commercial shipbuilding, repair upgrades, heavy engineering, and defence programmes.

However, it continues to incur cash losses and its net worth has been fully eroded.

The company's auditor Pathak H D & Associates said the company defaulted in repayment of principal and interest to its lenders, loans have been called back by secured lenders, non-current assets are significantly impaired and current liabilities exceeded its total assets.

"These conditions indicate the existence of a material uncertainty that may cast significant doubt on its ability to continue as going concern. The appropriateness of assumption of going concern is critically dependent upon the company's ability to raise requisite finance and generate cash nows in future to meet its obligations," it said.