Man Industries To Recover Rs 700 Crore From Unit Merino Shelters, MD Nikhil Mansukhani Says

Man Industries (India) Ltd. will recover Rs 600-700 crore from its arm Merino Shelters Pvt. Ltd. in the next four-five years, Managing Director Nikhil Mansukhani said on Tuesday.

Market regulator SEBI has barred the company and its three senior executives from accessing the securities markets for two years and imposed a fine of Rs 25 lakh on each of them for alleged financial misstatement.

In its order, SEBI noted that the financial statements of the company for the financial years 2015-16 to 2020-21 were "deliberately misstated". SEBI highlighted that Merino Shelters, a wholly-owned subsidiary, was excluded from consolidation after FY 2014-15 without any explanation.

"Merino Shelters was the main reason why this audit started from SEBI. We have sold the asset and recovered Rs 70 crore and the remaining Rs 600-700 crore will be recepovered in the next four-five years," Mansukhani told NDTV Profit in a televised interview. He is among the three individuals fined Rs 25 lakh by the SEBI.

According to SEBI, the misrepresentations, omissions, and concealments formed part of a scheme by which investors were deprived of the true financial picture of the company.

This concealment, the order stated, suppressed group-level losses and liabilities while artificially inflating MIIL's profits.

Mansukhani said the SEBI order was a "long-standing" matter and a legacy issue. The related party transactions were not mispresented as they were part of board meetings. Funds given to subsidiaries were in line with provisions.

"Money was given to subsidiaries. We were not consolidating Merino's financials due to legacy issues but SEBI took a contrary view to this. This order does not impact our operations. We are glad it has been completed. We are taking legal remedy in the matter," he said.

He noted that Merino Shelters' financial statements have been getting consolidated since FY24.

"Post SEBI audit, we took a conscious call of getting Merino consolidated in Man Industries. We have faced no compliance issues since 2021," Mansukhani said.