Tecpro Systems falls off the track

Tecpro Systems has been breaching the lower circuit since last week and today too, it opened 5% lower at Rs.14.87, hitting the lower circuit.

The stock is rock bottom every day as things are turning ugly on the financial front. It has been making losses consistently for the past few quarters, with FY14 ending with a loss of Rs.568 crore, Q1FY15 loss at Rs.181 crore and now loss in Q2 at Rs.173 crore. Its loss at end of H1FY15 stands at Rs.354 crore. Currently, its total liabilities exceed its total assets and due to failure to pay dues to the banks on said due dates, the company’s debt is being restructured under CDR and it is also being referred to the BIFR due to erosion of net worth. The Auditors have stated that given the material uncertainties, there is significant doubt on the company’ ability to continue as a going concern.

Bank guarantees to the tune of Rs.390 crore have been encashed by customers due to delays in execution of projects.