igc20240930_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended September 30, 2024

☐	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission file number: 001-32830

IGC PHARMA, INC.

(Exact name of registrant as specified in its charter)

Maryland

(State or other jurisdiction of incorporation or organization)

20-2760393

(I.R.S. Employer Identification No.)

10224 Falls Road, Potomac, Maryland

(Address of principal executive offices)

20854

(Zip Code)

(301) 983-0998

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.0001 per share		IGC		NYSE American LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☑ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☑ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☑	Smaller reporting company ☑
	Emerging growth company☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☑ No

77,449,374 shares of our common stock were outstanding as of November 7, 2024.

| September 30, 2024, Form 10-Q

IGC PHARMA, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2024

		Page
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations and Comprehensive Loss	5
	Condensed Consolidated Statements of Changes in Shareholder’s Equity	6
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	30

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31
Item 3.	Defaults Upon Senior Securities	31
Item 4.	Mine Safety Disclosures	31
Item 5.	Other Information	31
Item 6.	Exhibits	32

SIGNATURES		33

| September 30, 2024, Form 10-Q

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q and the documents incorporated herein by reference contain “forward-looking statements.” Additionally, we, or our representatives, may, from time to time, make other written or verbal forward-looking statements and discuss plans, expectations, and objectives regarding our business, financial condition, and results of operations. Without limiting the foregoing, statements that are in the future tense, and all statements accompanied by terms such as “believe,” “hope,” “potential,” “project,” “expect,” “trend,” “estimate,” “forecast,” “assume,” “intend,” “plan,” “target,” “anticipate,” “outlook,” “preliminary,” “will likely result,” “will continue,” and variations of them and similar terms are intended to be forward-looking statements” as defined by federal securities laws. Such statements are based on currently available information, which management has assessed but which is dynamic and subject to rapid change due to risks and uncertainties that affect our business.

For the next several years, we believe our success is highly correlated with the outcome of our clinical trials and secondarily with the sale of our products and services. The Company may not be able to complete human trials on our investigational drug candidates, or, once conducted, the results of human trials may not be favorable or as anticipated or may reflect a lack of efficacy in humans or animals. Precautions, including social distancing and travel restrictions, among others could lead to delays or expenses greater than anticipated or projected. Failure or delay with respect to any of the above factors could have a material adverse effect on our business, future results of operations, stock price, and financial condition.

Our projections and investments anticipate certain regulatory changes and stable pricing, which may not hold out over the next several years. We may not be able to protect our intellectual property adequately or receive patents. We may not receive regulatory approval for our products or trials. The patent applications we have licensed may not be granted by the United States Patent and Trademark Office (“USPTO”), even if the Company is in full compliance with USPTO requirements. We may not have adequate resources, including financial resources, to successfully conduct all requisite clinical trials, to bring a product based on the above-referenced patented formulations to market, or to pay applicable maintenance fees over time. We may not be able to successfully commercialize our products even if they are successful and receive regulatory approval, including, but not limited to, based on the Food and Drug Administration’s (“FDA”) current position on hemp and hemp-based products. Failure or delay with respect to any of the factors above could have a material adverse effect on our business, future results of operations, stock price, and financial condition.

This document also contains statements that are not approved by the FDA, including but not limited to the statements on hemp and hemp extracts and their potential efficacy on humans and animals. While these statements and claims are intended to be in compliance with federal and state laws, we cannot guarantee such compliance.

We caution you not to place undue reliance on forward-looking statements, which are based upon assumptions, expectations, plans, and projections subject to risks and uncertainties, including those, if any, identified in the “Risk Factors” set forth in this report or in our annual report on Form 10-K for the fiscal year ended March 31, 2024, filed with the Securities and Exchange Commission (“SEC”) on June 24, 2024 and other documents that we subsequently file with the SEC that update, supplement or supersede such information, which may cause actual results to differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements speak only as of the date when they are made. Except as required by federal securities law, we do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations, or the occurrence of unanticipated events after the date of those statements.

| September 30, 2024, Form 10-Q

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

IGC Pharma, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

(Unaudited)

	September 30, 2024 ($)			March 31, 2024 ($)
ASSETS
Current assets:
Cash and cash equivalents		1,546			1,198
Accounts receivable, net		44			39
Inventory		1,510			1,540
Asset held for sale		716			720
Deposits and advances		434			208
Total current assets		4,250			3,705

Non-current assets:
Intangible assets, net		1,803			1,616
Property, plant, and equipment, net		3,468			3,695
Claims and advances		687			688
Operating lease asset		161			198
Total non-current assets		6,119			6,197
Total assets		10,369			9,902
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		768			773
Accrued liabilities and others		2,034			1,567
Total current liabilities		2,802			2,340

Non-current liabilities:
Long-term loans		135			137
Other liabilities		20			20
Operating lease liability		35			84
Total non-current liabilities		190			241
Total liabilities		2,992			2,581

Commitments and Contingencies – See Note 12

Stockholders’ equity:
Preferred stock, $0.0001 par value: authorized 1,000,000 shares, no shares issued or outstanding as of September 30, 2024, and March 31, 2024.
Common stock and additional paid-in capital, $0.0001 par value: 150,000,000 shares authorized; 76,636,419 and 66,691,195 shares issued and outstanding as of September 30, 2024, and March 31, 2024, respectively.		128,578			124,409
Accumulated other comprehensive loss		(3,441	)		(3,423	)
Accumulated deficit		(117,760	)		(113,665	)
Total stockholders’ equity		7,377			7,321
Total liabilities and stockholders’ equity		10,369			9,902

The accompanying notes should be read in connection with these Condensed Consolidated Financial Statements.

| September 30, 2024, Form 10-Q

Table of Contents

IGC Pharma, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except loss per share and share data)

(Unaudited)

	Three months ended September 30,						Six months ended September 30,
	2024			2023			2024			2023
	($)			($)			($)			($)

Revenue		412			291			684			846
Cost of revenue		(214	)		(117	)		(323	)		(417	)
Gross profit		198			174			361			429
Selling, general and administrative expenses		(1,041	)		(1,397	)		(2,711	)		(3,044	)
Research and development expenses		(917	)		(1,268	)		(1,806	)		(2,015	)
Operating loss		(1,760	)		(2,491	)		(4,156	)		(4,630	)
Other income, net		43			40			61			104
Loss before income taxes		(1,717	)		(2,451	)		(4,095	)		(4,526	)
Income tax expense/benefit		-			-			-			-
Net loss attributable to common stockholders		(1,717	)		(2,451	)		(4,095	)		(4,526	)
Foreign currency translation adjustments		(15	)		(63	)		(18	)		(54	)
Comprehensive loss		(1,732	)		(2,514	)		(4,113	)		(4,580	)

Net loss per share attributable to common stockholders:
Basic and diluted	$	(0.02	)		(0.05	)		(0.06	)		(0.08	)
Weighted-average number of shares used in computing net loss per share amounts:		76,007,129			54,301,087			74,419,059			53,695,912

The accompanying notes should be read in connection with these Condensed Consolidated Financial Statements.

| September 30, 2024, Form 10-Q

Table of Contents

IGC Pharma, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(Unaudited)

Three months ended September 30, 2023	Number of Common Shares			Common Stock and Additional Paid in Capital ($)		Accumulated Deficit ($)			Accumulated Other Comprehensive Loss ($)			Total Stockholders’ Equity ($)
Balances as of June 30, 2023		53,077			119,322		(102,740	)		(3,380	)		13,202
Common stock-based compensation & expenses, net		1,130			550		-			-			550
Share money received but not allotted		-			-		-			-			-
Issuance of common stock through offering (net of expenses)		10,000			2,860		-			-			2,860
Cancellation/forfeiture of shares		(500	)		-		-			-			-
Net loss		-			-		(2,451	)		-			(2,451	)
Foreign currency translation adjustments		-			-		-			(63	)		(63	)
Balances as of September 30, 2023		63,707			122,732		(105,191	)		(3,443	)		14,098

Three months ended September 30, 2024
Balances as of June 30, 2024		75,636			127,349		(116,043	)		(3,426	)		7,880
Common stock-based compensation & expenses, net		-			434		-			-			434
Share money received but not allotted		-			427		-			-			427
Issuance of common stock through offering (net of expenses)		1,000			368		-			-			368
Cancellation/forfeiture of shares		-			-		-			-			-
Net loss		-			-		(1,717	)		-			(1,717	)
Foreign currency translation adjustments		-			-		-			(15	)		(15	)
Balances as of September 30, 2024		76,636			128,578		(117,760	)		(3,441	)		7,377

Six months ended September 30, 2023	Number of Common Shares			Common Stock and Additional Paid in Capital ($)		Accumulated Deficit ($)			Accumulated Other Comprehensive Loss ($)			Total Stockholders’ Equity ($)
Balances as of March 31, 2023		53,077			118,965		(100,665	)		(3,389	)		14,911
Common stock-based compensation & expenses, net		1,130			907		-			-			907
Issuance of common stock through offering (net of expenses)		10,000			2,860		-			-			2,860
Share money received but not allotted		-			-		-			-			-
Cancellation/forfeiture of shares		(500	)		-		-			-			-
Net loss		-			-		(4,526	)		-			(4,526	)
Foreign currency translation adjustments		-			-		-			(54	)		(54	)
Balances as of September 30, 2023		63,707			122,732		(105,191	)		(3,443	)		14,098

Six months ended September 30, 2024
Balances as of March 31, 2024		66,691			124,409		(113,665	)		(3,423	)		7,321
Common stock-based compensation & expenses, net		-			867		-			-			867
Share money received but not allotted		-			427		-			-			427
Issuance of common stock through offering (net of expenses)		9,945			2,875		-			-			2,875
Cancellation/forfeiture of shares		-			-		-			-			-
Net loss		-			-		(4,095	)		-			(4,095	)
Foreign currency translation adjustments		-			-		-			(18	)		(18	)
Balances as of September 30, 2024		76,636			128,578		(117,760	)		(3,441	)		7,377

The accompanying notes should be read in connection with these Condensed Consolidated Financial Statements.

| September 30, 2024, Form 10-Q

Table of Contents

IGC Pharma, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

	Six months Ended September 30,
	2024 ($)			2023 ($)
Cash flows from operating activities:
Net loss		(4,095	)		(4,526	)
Adjustment to reconcile net loss to net cash:
Depreciation and amortization		307			313
Common stock-based compensation and expenses, net		804			907
Profit on sale of assets		(14	)		(42	)
Other non-cash items		-			(10	)

Changes in:
Accounts receivables, net		(5	)		(30	)
Inventory		30			15
Deposits and advances		(227	)		76
Claims and advances		1			5
Accounts payable		(4	)		19
Accrued and other liabilities		467			185
Operating lease asset		37			63
Operating lease liability		(49	)		(61	)
Net cash used in operating activities		(2,748	)		(3,086	)

Cash flow from investing activities:
Purchase of property, plant, and equipment		(67	)		(55	)
Sale of property, plant, and equipment		16			42
Investment in short term investments		-			128
Acquisition and development of intangible assets		(145	)		(48	)
Net cash used in investing activities		(196	)		67

Cash flows from financing activities:
Net proceeds from the issuance of common stock		3,303			2,860
Repayment of long-term loan		(2	)		(2	)
Net cash provided by financing activities		3,301			2,858

SEC Form 10-Q filed by IGC Pharma Inc.