The September quarter marks another period of financial distress for Pasupati Fincap, with the company generating minimal revenue of ₹0.05 crores whilst continuing to incur losses. The most alarming development has been the complete exit of promoters, whose shareholding dropped from 11.51% in March 2025 to 0.00% by June 2025. This dramatic reduction in promoter confidence raises serious questions about the company's viability and future prospects.
Incorporated in December 1993 with objectives including hire-purchase, bill discounting, and securities dealing, Pasupati Fincap has effectively ceased meaningful operations. The company's balance sheet reveals shareholder funds of negative ₹0.60 crores as of March 2025, deteriorating from negative ₹0.24 crores in the previous year. With reserves and surplus standing at negative ₹5.30 crores against share capital of ₹4.70 crores, the company's financial position remains precarious.
| Quarter | Sep'25 | Jun'25 | Mar'25 | Dec'24 | Sep'24 | Jun'24 |
|---|---|---|---|---|---|---|
| Net Sales (₹ Cr) | 0.05 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Net Loss (₹ Cr) | -0.07 | -0.07 | -0.04 | -0.02 | -0.05 | -0.25 |
| Interest Cost (₹ Cr) | 0.03 | 0.02 | 0.02 | 0.01 | 0.03 | 0.02 |
| Employee Cost (₹ Cr) | 0.03 | 0.01 | 0.01 | 0.01 | 0.01 | 0.03 |
Financial Performance: Operational Collapse
The Q2 FY26 results reveal a company in severe distress. Net sales of ₹0.05 crores represent minimal business activity, whilst the operating loss before interest stood at ₹0.04 crores, reflecting an operating margin of negative 80.00%. Employee costs of ₹0.03 crores and interest expenses of ₹0.03 crores consumed the negligible revenue, resulting in a pre-tax loss of ₹0.07 crores.
On a half-yearly basis (H1 FY26), the company reported cumulative losses of ₹0.14 crores with virtually no revenue generation. The loss for Q2 FY26 remained flat compared to Q1 FY26, indicating no improvement in the operational trajectory. Year-on-year comparisons are challenging given the consistently negligible revenue base, but the pattern of sustained losses is evident across all recent quarters.
The quality of the balance sheet has deteriorated significantly. Shareholder funds turned negative at ₹0.60 crores in March 2025, compared to negative ₹0.24 crores in March 2024. Current liabilities stood at ₹0.66 crores against minimal current assets of ₹0.00 crores, indicating severe liquidity constraints. The company has no fixed assets, investments, or meaningful asset base to support operations.
Promoter Exit: A Critical Red Flag
The most alarming development in recent quarters has been the complete exit of promoters from the company. Promoter shareholding, which stood at 11.51% through September 2024 to March 2025, collapsed to 0.00% by June 2025. This represents a complete abandonment of the company by its founding stakeholders, typically a signal of deep-seated problems and lack of confidence in future prospects.
The shareholding vacuum left by promoters has been filled by non-institutional investors, whose stake increased from 88.47% to 99.98% between March 2025 and June 2025. With negligible institutional participation—just 0.02% held by other domestic institutional investors—the company lacks the credibility and support typically required for a turnaround. No foreign institutional investors, mutual funds, or insurance companies hold positions in the stock.
Critical Governance Concern
Promoter Exit: The complete withdrawal of promoters from 11.51% to 0.00% shareholding in Q1 FY26 represents an unprecedented vote of no confidence. This development, combined with negative book value and sustained losses, raises serious questions about the company's ability to continue as a going concern.
Capital Structure: Negative Net Worth
Pasupati Fincap's balance sheet reveals a company with completely eroded equity. Share capital stands at ₹4.70 crores, but reserves and surplus of negative ₹5.30 crores result in negative shareholder funds of ₹0.60 crores as of March 2025. This represents a deterioration from negative ₹0.24 crores in March 2024, indicating continued value destruction.
The company's book value per share stands at negative ₹1.27, meaning shareholders have no residual claim on assets after liabilities. Current liabilities of ₹0.66 crores exceed the company's minimal asset base, creating a negative working capital situation. With no fixed assets, investments, or cash generation capability, the company lacks the resources required for operational recovery.
| Quarter | Jun'25 | Mar'25 | Dec'24 | Sep'24 | Jun'24 |
|---|---|---|---|---|---|
| Promoter Holding | 0.00% | 11.51% | 11.51% | 11.51% | 11.51% |
| QoQ Change | ▼ -11.51% | — | — | — | — |
| FII Holding | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| MF Holding | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
| Other DII | 0.02% | 0.02% | 0.02% | 0.02% | 0.02% |
| Non-Institutional | 99.98% | 88.47% | 88.47% | 88.47% | 88.47% |
Peer Comparison: Bottom of the Barrel
Within the NBFC sector, Pasupati Fincap ranks at the bottom across all key metrics. With a market capitalisation of just ₹8.00 crores, it is the smallest amongst its peer group. The company's price-to-book value of negative 8.88x reflects the negative net worth, whilst peers like GCM Capital trade at 0.37x book value with positive equity.
The company's return on equity stands at 0.00%, though this figure is meaningless given the negative book value. Even amongst distressed peers, Pasupati Fincap stands out for its complete lack of revenue generation and operational activity. The company has no debt, not as a sign of strength, but due to the absence of any lending operations or asset base to support borrowing.
| Company | P/E (TTM) | P/BV | ROE % | Market Cap |
|---|---|---|---|---|
| Pasupati Fincap | NA (Loss Making) | -8.88x | 0.00% | ₹8 Cr |
| GCM Capital | NA (Loss Making) | 0.37x | 0.58% | Higher |
| Typhoon Fin Ser | 50.01x | — | — | Higher |
Valuation Analysis: A Value Trap
Traditional valuation metrics are largely irrelevant for Pasupati Fincap given its loss-making status and negative book value. The P/E ratio is not applicable, whilst the price-to-book value of negative 8.88x reflects the complete erosion of shareholder equity. The stock's current price of ₹18.90 represents a 57.32% decline from its 52-week high of ₹44.28, though this fall has been justified by the deteriorating fundamentals.
The company's overall valuation assessment is classified as "RISKY" with frequent grade changes between "Risky" and "Very Attractive" over recent months, reflecting the high volatility and speculative nature of the stock. With a Mojo Score of just 17 out of 100 and a "STRONG SELL" rating, the stock represents a value trap rather than an investment opportunity.
Stock Performance: Severe Underperformance
Pasupati Fincap's stock has delivered deeply negative returns across most timeframes, significantly underperforming both the Sensex and its NBFC sector peers. Over the past year, the stock has declined 16.67% compared to the Sensex's gain of 9.00%, resulting in an alpha of negative 25.67%. Year-to-date performance has been even worse, with the stock down 53.82% against the Sensex's 8.22% gain.
The three-month return stands at negative 18.00%, underperforming the Sensex by 22.92 percentage points. However, the six-month return shows a gain of 41.57%, though this appears to be driven by speculative trading rather than fundamental improvement. The stock's five-year return of 1,848.45% and ten-year return of 687.50% reflect the extremely low base from which it started, rather than genuine value creation.
Technical indicators paint a bearish picture. The stock trades below all major moving averages—5-day (₹22.33), 20-day (₹25.05), 50-day (₹24.18), 100-day (₹21.18), and 200-day (₹24.43). The overall technical trend is classified as "MILDLY BEARISH" with most indicators showing bearish or mildly bearish signals. With a high beta of 1.50 and volatility of 59.01%, the stock carries extreme risk without commensurate returns.
| Period | Stock Return | Sensex Return | Alpha |
|---|---|---|---|
| 1 Day | +5.00% | +0.10% | +4.90% |
| 3 Months | -18.00% | +4.92% | -22.92% |
| 6 Months | +41.57% | +3.97% | +37.60% |
| YTD | -53.82% | +8.22% | -62.04% |
| 1 Year | -16.67% | +9.00% | -25.67% |
Investment Thesis: Multiple Red Flags
The investment thesis for Pasupati Fincap is overwhelmingly negative across all parameters. The Mojo 4 Dots Analysis reveals a company with "MIXED" near-term drivers (flat financial trend and mildly bearish technicals), "BELOW AVERAGE" quality assessment, "RISKY" valuation, and an overall "MIXED" assessment that leans heavily negative.
The company's quality grade of "BELOW AVERAGE" reflects its long-term financial underperformance, with zero sales growth over five years, zero EBIT growth, and negligible institutional holdings of just 0.02%. The financial trend is classified as "FLAT" for Q2 FY26, though this understates the severity of the operational collapse. Technical indicators remain "MILDLY BEARISH" with the stock trading below all major moving averages.
"With promoters exiting completely, negative book value, and virtually no revenue generation, Pasupati Fincap represents a classic value trap where low absolute price masks fundamental insolvency."
Key Strengths & Risk Factors
Limited Positives
- No Debt Burden: Company carries no long-term debt, though this reflects lack of operations rather than financial strength
- Low Absolute Price: At ₹18.90, the stock has low absolute price, attracting speculative interest
- Micro-Cap Status: Small size allows for potential restructuring or acquisition scenarios
Critical Concerns
- Complete Promoter Exit: Promoters reduced stake from 11.51% to 0.00% in Q1 FY26, signalling abandonment
- Negative Book Value: Shareholder funds of negative ₹0.60 crores indicate complete equity erosion
- No Revenue Generation: Minimal sales of ₹0.05 crores in Q2 FY26 with no meaningful business operations
- Sustained Losses: Consistent quarterly losses with no path to profitability visible
- Zero Institutional Support: No FII, MF, or insurance company holdings; only 0.02% DII
- Negative Working Capital: Current liabilities exceed current assets, indicating liquidity crisis
- Going Concern Risk: Combination of factors raises serious questions about business continuity
Outlook: What to Watch
Potential Catalysts (Unlikely)
- Corporate restructuring or acquisition by a larger entity
- Capital infusion from new investors
- Return of promoters or new management team
- Asset monetisation or business revival plan
Red Flags to Monitor
- Further deterioration in book value below current negative ₹0.60 crores
- Inability to meet current liabilities leading to default
- Regulatory action or delisting proceedings
- Continued absence of any meaningful revenue generation
- Additional erosion of non-institutional shareholding
The Verdict: Avoid at All Costs
Score: 17/100
For Fresh Investors: Avoid completely. The combination of negative book value, complete promoter exit, negligible revenue, and sustained losses creates an extremely high-risk situation with minimal probability of recovery. This is a value trap, not an investment opportunity.
For Existing Holders: Exit immediately at any available price. The complete withdrawal of promoters and deteriorating fundamentals suggest the company may be approaching insolvency. Every day of delay increases the risk of total capital loss.
Fair Value Estimate: Not applicable due to negative book value and lack of earnings. Current price of ₹18.90 significantly overstates residual value.
Note— ROCE = (EBIT - Other income)/(Capital Employed - Cash - Current Investments)
⚠️ Investment Disclaimer
This article is for educational and informational purposes only and should not be construed as financial advice. Investors should conduct their own due diligence, consider their risk tolerance and investment objectives, and consult with a qualified financial advisor before making any investment decisions. The analysis presented is based on publicly available data as of November 15, 2025, and circumstances may change materially.
