Mukta Arts Ltd

Parties and purpose

• Parties: Mukta Arts Limited; Mukta A2 Cinemas Private Limited; Rajiv Malhotra (Proposed Investor).
• Purpose: investment up to Rs 10 crore via equity shares and CCDs in Mukta A2.

Key terms

• Up to Rs 10 crore to be invested through equity shares and CCDs in Mukta A2.
• Mukta A2 will cease to be a subsidiary and become an associate; parent holding diluted to 42–49%.
• Post-transaction, Mukta Arts' ownership in Mukta A2 estimated at 42–49%; no change in listed entity's management.
• Mukta A2 will issue equity and CCDs to investor or affiliates.
• Restriction: no transfer of Mukta A2 stake to third parties without investor's written consent.
• Related party status: Mukta Arts and Mukta A2 are related; proposed investor not related.
• Related party transaction: may fall within RPT; will be conducted at arm's length.

Counterparties and relationship

• Counterparties: Mukta A2 Cinemas Private Limited (subsidiary); Rajiv Malhotra (Proposed Investor); Mukta Arts Limited (parent).
• Annexure-A confirms investor is not related to the company or Mukta A2.

Impact and disclosures

• Board-approved execution of Share Subscription Agreement and Shareholders Agreement for Mukta A2 investment.
• Date of board approval: 12 August 2026.
• No Nominee Director to be appointed on Mukta Arts' board.
• Regulatory approvals not expressly disclosed; filing complies with SEBI LODR requirements.

Meeting Details

• Board meeting on 12 August 2026; time and venue not disclosed.

Key Agenda Items

• Unaudited standalone results for quarter ended June 30, 2026.
• Unaudited consolidated results for quarter ended June 30, 2026.

Other Notes

• Trading window closed from 1 July 2026 until 48 hours after results declaration.

Dematerialisation and register update

• Dematerialisation requests processed; confirmations sent to depositories; securities listed on exchanges.
• Physical certificates for dematerialisation mutilated and cancelled; depository name updated as registered owner within prescribed timelines.

Financial Performance Q3 FY 2025-26

• Consolidated EBITDA rose 39% year-on-year to Rs. 1,552 lacs
• Consolidated EBITDA margin expanded from 8% to 12% over nine months
• Losses before tax narrowed 93% quarter-on-quarter to Rs. 13.20 lacs
• Standalone EBITDA margin improved to 53% from 48% year-on-year
• Standalone total expenses reduced by 36% over nine months

Segment Performance

• Whistling Woods International revenues increased 10% over nine months
• Whistling Woods EBITDA margin improved from 7% to 9% year-on-year
• Mukta A2 Cinemas EBITDA rose to Rs. 510.66 lacs with margin doubling quarter-on-quarter to 20%
• Mukta A2 Cinemas losses before tax declined 94% quarter-on-quarter to Rs. 20.17 lacs
• Mukta A2 Multiplex Bahrain turned EBITDA positive at Rs. 151.96 lacs
• Mukta A2 Multiplex Bahrain EBITDA margin improved to 11%, losses before tax declined 57% quarter-on-quarter

Strategic and Operational Highlights

• Company focused on operational efficiency and disciplined cost management
• Strong performance across media, entertainment, and education verticals
• Management committed to strengthening balance sheet and enhancing shareholder value
• Mukta Arts positioned to capitalize on emerging sector opportunities

Financial Performance

• Board approved unaudited standalone and consolidated results for Q3 and nine months ended Dec 31, 2025.
• Standalone profit after tax for nine months: Rs. 332.23 lakhs; EPS: Rs. 1.47.
• Consolidated loss after tax for nine months: Rs. 1,110.45 lakhs; EPS: Rs. (4.92).
• Total standalone revenue for nine months: Rs. 1,868.82 lakhs; consolidated revenue: Rs. 13,452.28 lakhs.
• Software division standalone loss before tax and finance costs: Rs. (323.16) lakhs for nine months.
• Others segment standalone profit before tax and finance costs: Rs. 455.01 lakhs for nine months.

Regulatory and Legal Matters ️

• Litigation ongoing with Maharashtra Film Stage and Cultural Development Corporation over rent arrears; Rs. 113.54 crores paid till Dec 31, 2025.
• Bombay High Court order challenged; matter sub-judice; auditors continue to modify report.
• WWIL net worth fully eroded as of Dec 31, 2025; no adjustment to investments or loans pending litigation outcome.

Auditor Remarks

• Auditors issued limited review reports with emphasis on uncertainty related to WWIL investment and Ind AS 116 lease accounting.
• Material uncertainty on Mukta A2 Cinemas Private Limited’s going concern due to fully eroded net worth.
• Consolidated results include unaudited or management-certified interim financials of subsidiaries and joint ventures.

Financial Ratios and Other Disclosures

• Debt to equity ratio: 0.3 standalone; negative consolidated reflecting losses.
• Current ratio: 19.2 standalone; 0.7 consolidated.
• No adjustments made for Ind AS 116 lease accounting on land rights pending litigation resolution.