AIA Engineering operating cash flow rises to Rs 652 crore

AIA Engineering Limited generated Rs 652.07 crore of net cash from operating activities in the half year ended 30 September 2026, up from Rs 498.45 crore a year earlier. The increase was led by a Rs 191.20 crore cash inflow from lower trade receivables, despite Rs 124.86 crore being absorbed by inventory growth.

How much operating cash did AIA Engineering generate?

AIA Engineering generated Rs 652.07 crore of net cash from operating activities in the half year ended 30 September 2026, compared with Rs 498.45 crore in the half year ended 30 September 2025. Cash generated from operations before tax payments rose to Rs 789.83 crore from Rs 619.21 crore, while income taxes paid net of refunds increased to Rs 137.75 crore from Rs 120.76 crore.

The increase in operating cash occurred although profit before tax declined to Rs 724.55 crore from Rs 745.46 crore. After adjustments for items including investment gains, fair-value movements, depreciation, finance costs and foreign-exchange translation, the cash-flow statement showed Rs 648.48 crore before working-capital changes, compared with Rs 679.92 crore in the prior-year half.

Why did AIA Engineering’s operating cash flow increase?

AIA Engineering’s operating cash flow increased mainly because lower trade receivables generated Rs 191.20 crore of cash in the six months to 30 September 2026, compared with Rs 46.88 crore in the comparable prior-year period. The latest receivables movement therefore delivered Rs 144.32 crore more cash year on year and was the largest reported working-capital inflow.

Consolidated trade receivables stood at Rs 965.21 crore at 30 September 2026, down from Rs 1,168.61 crore at 31 March 2026. The balance-sheet decline was accompanied by a Rs 124.86 crore increase in inventories during the half year, although this was lower than the Rs 156.88 crore inventory increase recorded in the half year ended 30 September 2025.

Other working-capital movements added to the latest period’s cash generation. Loans decreased by Rs 50.87 crore, other current and non-current assets decreased by Rs 13.60 crore, and trade payables increased by Rs 9.21 crore. These movements were partly offset by a Rs 6.94 crore decrease in provisions, while other current liabilities increased by Rs 4.57 crore.

How did operating cash compare with AIA Engineering’s earnings and revenue?

AIA Engineering’s operating cash of Rs 652.07 crore exceeded its reported profit for the period of Rs 550.43 crore in the half year ended 30 September 2026. Profit for the period declined from Rs 582.64 crore a year earlier, so the cash-flow increase reflected working-capital movements rather than a higher reported profit figure.

Revenue from sale of products increased to Rs 2,246.49 crore from Rs 2,055.69 crore, while total revenue from operations rose to Rs 2,280.79 crore from Rs 2,086.71 crore. Over the same six-month comparison, total expenses rose to Rs 1,751.46 crore from Rs 1,554.00 crore and profit before tax declined by Rs 20.91 crore.

Depreciation and amortisation expense, a non-cash adjustment in the cash-flow reconciliation, was Rs 59.60 crore in the latest half year against Rs 55.65 crore a year earlier. Net fair-value change in financial assets measured at fair value through profit or loss, abbreviated as FVTPL, was a Rs 127.90 crore deduction in the latest period, compared with a Rs 108.34 crore deduction in the previous period.

Where did AIA Engineering deploy cash in the half year?

AIA Engineering used Rs 540.18 crore in investing activities in the half year ended 30 September 2026, compared with Rs 936.96 crore in the corresponding 2025 period. Net purchases of investments accounted for Rs 281.36 crore and net investment in fixed deposits with banks accounted for Rs 217.28 crore.

The group spent Rs 57.92 crore on acquiring property, plant and equipment, capital work-in-progress, leasehold land and other intangibles, compared with Rs 43.77 crore in the prior-year half. Interest received was Rs 15.09 crore, marginally below Rs 15.49 crore in the half year ended 30 September 2025, while proceeds from asset sales were Rs 0.73 crore.

Current investments were Rs 4,543.54 crore at 30 September 2026, compared with Rs 4,159.98 crore at 31 March 2026. Bank balances other than cash and cash equivalents increased to Rs 226.11 crore from Rs 8.80 crore over the same period, alongside the reported net investment in fixed deposits.

What happened to AIA Engineering’s cash balance and financing flows?

AIA Engineering ended 30 September 2026 with cash and cash equivalents of Rs 285.80 crore, up from Rs 215.06 crore at 31 March 2026. The Rs 69.78 crore increase contrasted with a Rs 58.39 crore decrease during the half year ended 30 September 2025, when investing cash outflow was Rs 936.96 crore.

Financing activities used Rs 42.11 crore in the latest half year, compared with net cash generated of Rs 380.12 crore a year earlier. Net current borrowings provided Rs 97.33 crore, while dividends paid absorbed Rs 136.15 crore and finance costs paid were Rs 1.57 crore.

Current borrowings were Rs 97.33 crore at 30 September 2026, whereas the consolidated balance sheet at 31 March 2026 reported no current borrowings. Finance costs in the statement of profit and loss were Rs 2.06 crore for the latest half year, down from Rs 14.90 crore in the corresponding prior-year period.

What disclosures qualify the consolidated cash-flow figures?

AIA Engineering prepared its consolidated cash-flow statement under the indirect method specified in Indian Accounting Standard 7, or Ind AS 7. The board approved the unaudited consolidated results on 3 November 2026, and the statutory auditors issued an unmodified limited-review conclusion.

The group reported one primary business segment under Ind AS 108, manufacturing High Chrome Mill Internals. The consolidated figures include subsidiaries and the group’s share of its Australian joint venture, Vega MPS Pty. Ltd., rather than separate cash-flow information by operating business segment.

Welcast Steels Limited, a subsidiary, remains prepared on a non-going-concern basis after its board decided on 15 October 2025 to close its only factory from 15 December 2025. The filing states that labour disputes remain pending before courts and other judicial forums, and that there was no change in its operational status during the quarter ended 30 September 2026.

Conclusion

AIA Engineering produced more operating cash in the half year ended 30 September 2026 despite lower profit before tax, as the Rs 191.20 crore receivables inflow and lower inventory cash absorption supported working capital. The group also used Rs 540.18 crore in investing activities, principally for investments and bank fixed deposits, while cash and cash equivalents rose by Rs 69.78 crore.

The next disclosure should show whether trade receivables remain below the Rs 1,168.61 crore reported at 31 March 2026 and whether inventories continue to rise from Rs 1,381.13 crore at 30 September 2026. It should also provide any update on Welcast Steels, where pending labour disputes underpin the continuing non-going-concern basis of preparation.