Airfloa defers Rs 10.77 crore machinery spending to FY27

Airfloa Rail Technology Limited has deferred Rs 10.77 crore of unspent IPO funding for machinery and equipment to Fiscal 2027 after using Rs 2.91 crore by September 30, 2026, against a prospectus schedule to deploy the full Rs 13.68 crore allocation by Fiscal 2026. Management cited Chinese policy changes and supplier lead times.

Why did Airfloa delay its machinery procurement?

Airfloa delayed machinery procurement because it deferred orders for certain capital-expenditure items after Chinese Government policy changes and market conditions affected supplier capacity and lead times. Its prospectus dated September 16, 2025 had estimated that the Rs 13.68 crore machinery and equipment allocation would be utilised by Fiscal 2026.

The delay does not reflect a disclosed revision in the project cost. At September 30, 2026, the machinery object retained an original cost and revised cost of Rs 13.68 crore, and Airfloa said there was no revision in the cost of any IPO object during the reported quarter. Net IPO proceeds across the four stated objects totalled Rs 88.85 crore.

Management proposes to place orders for the new machinery during Fiscal 2027 and expects to complete procurement by the end of Fiscal 2027. The delay statement applies specifically to machinery and equipment, not to the Rs 6.00 crore borrowing-repayment allocation, Rs 59.27 crore working-capital allocation or Rs 9.90 crore general-corporate-purpose allocation.

The filing measures the delay against the original Fiscal 2026 timetable rather than a newly disclosed interim deadline. Airfloa's progress table records Rs 2.91 crore of machinery spending by Q1 FY27, and the statutory auditor certificate and management undertaking confirm the same cumulative utilisation at the end of Q2 FY27 on September 30, 2026.

How much of Airfloa's IPO funding remains unused?

Airfloa had Rs 10.77 crore of unutilised net IPO proceeds at September 30, 2026, and the entire amount was allocated to machinery and equipment. The company had used Rs 2.91 crore from the Rs 13.68 crore machinery allocation, while the other three IPO objects were shown as fully utilised in the progress statement.

No IPO proceeds were deployed during the July-to-September 2026 quarter. Total utilisation remained Rs 78.08 crore at both the start and end of Q2 FY27, compared with net IPO proceeds of Rs 88.85 crore, leaving the unutilised amount unchanged at Rs 10.77 crore.

The comparison shows that machinery was the sole unfinished IPO object on September 30, 2026. The filing also states that no amount was used from general corporate purposes during Q2 FY27, which is consistent with the progress table showing that the Rs 9.90 crore allocation had already been used before that quarter.

Airfloa's prospectus provided that any net proceeds not used fully or partly within the specified period could be used in subsequent periods in accordance with applicable laws. The September 30 statement does not identify a new machinery supplier, disclose orders already placed, or set out a revised project cost beyond the unchanged Rs 13.68 crore allocation.

Where is Airfloa holding its unspent IPO money?

Airfloa held Rs 9.84 crore of unspent net proceeds in an Axis Bank monitoring account on September 30, 2026, alongside Rs 90 lakh in two Axis Bank fixed deposits and Rs 2.59 lakh in the public issue account. These balances correspond to the Rs 10.77 crore net-proceeds amount that remained unutilised.

The monitoring account had a total balance of Rs 9.87 crore, including Rs 2.86 lakh of interest received from fixed-deposit redemptions during Q2 FY27. The public issue account had a total balance of Rs 20.51 lakh, comprising Rs 2.59 lakh of net proceeds and Rs 17.92 lakh earmarked for issue expenses.

The two listed fixed deposits had stated maturity dates of July 6, 2026 and reported earnings of Rs 6.31 lakh and Rs 6.07 lakh, respectively, as of September 30, 2026. Airfloa said monitoring the deployment of interest earned on unutilised proceeds was outside the monitoring agency report's scope, and stated that it had not created any lien during interim use of proceeds.

What did the auditor say about Airfloa's IPO utilisation?

Airfloa's statutory auditor, Varadarajan & Co, said on November 4, 2026 that nothing had come to its attention suggesting IPO-proceeds utilisation through September 30, 2026 was inconsistent with unaudited books or the purposes stated in the prospectus. The certificate covered the period from July 1 to September 30, 2026.

The auditor said it examined documents including bank statements and utilisation invoices under applicable Institute of Chartered Accountants of India guidance and auditing standards. Its conclusion addresses consistency of use with stated purposes, while the monitored statement separately records the Rs 10.77 crore machinery balance and the deferred Fiscal 2027 procurement plan.

The monitoring statement reported no major deviation from earlier monitoring-agency reports and no change in the means of financing the IPO objects. It also recorded no unfavourable event affecting the viability of the objects, while identifying Chinese policy changes, supplier capacity and lead times as the reasons for the machinery schedule delay.

The distinction in the filing is between a delayed timetable and a reallocation of money. By September 30, 2026, Airfloa had fully used the Rs 6.00 crore allocated to partial borrowing repayment and Rs 59.27 crore allocated to working capital, whereas Rs 10.77 crore remained available only for machinery procurement.

Conclusion

Airfloa had deployed Rs 78.08 crore of its Rs 88.85 crore net IPO proceeds by September 30, 2026, with the outstanding Rs 10.77 crore concentrated entirely in machinery and equipment. The programme's cost remained Rs 13.68 crore, but only Rs 2.91 crore had been used against the original Fiscal 2026 completion schedule.

The next disclosed milestone is management's plan to place machinery orders during Fiscal 2027 and complete procurement by the end of Fiscal 2027. Subsequent utilisation statements will show whether the Rs 10.77 crore balance is deployed as planned and whether the machinery allocation remains unchanged.