Over 1,000 entities make use of relaxation; file Q1 nos in Sept

More than 1,000 listed firms have disclosed their financial results for the June quarter in September, making use of the relaxation given by the Securities and Exchange Board of India (Sebi).

In July, the regulator had allowed companies an extra month for their Q1 result filings, due to disruptions caused by the pandemic. Under normal circumstances, a listed firm has to declare its quarterly numbers within 45 days. The deadline for Q1 results, therefore, falls on August 15.

However, only 1,538 entities out of the 4,000-odd listed ones managed to declare their results within the usual deadline. Close to 2,000 firms disclosed their numbers between August 15 and September 15. “Given that the June quarter financials will be the first set of numbers to show the full impact of Covid-related lockdowns, it is understandable that companies and auditors have had to navigate through the audit process with a higher degree of scrutiny. Though some firms proactively submitted their financials before the deadline, the impact of the lockdown — be it availability of resources or matters of concern — have not been uniform across sectors/regions. Hence, it is unfair to compare the timing of submission in this quarter,” said Vishal Yaduvanshi, partner at Induslaw.

Experts said the deadline extension helped take off some stress for India Inc.

“Sebi’s extension of the deadline to publish June quarter results did help listed firms focus on restoration of business operations and recovery from other related stress areas, such as restoration of cash cycle and working capital management. Blackout periods got pushed accordingly, helping certain companies raise capital within their targeted timelines,” said Jitesh Shahani, partner at L&L Partners.

Rajesh Thakkar, partner and leader (transaction tax) at BDO India, said the extension was warranted, given the deadline for filing both Q4FY20 and FY20 results was pushed to July 31.

Some believe Sebi should now revert to the original deadline as such relaxations keep investors in the dark.

“While a delay in quarterly reporting of financial results doesn’t help investors, these were unique circumstances that demanded such measures. It is, however, unlikely that Sebi will provide similar relaxations any further,” said Shahani.