Akums cash falls Rs 202.41 crore as investing outflow tops cash

Akums Drugs and Pharmaceuticals Limited reported a Rs 202.41 crore decline in cash and cash equivalents during the six months ended 30 September 2026, closing at Rs 183.59 crore after investing activities used Rs 354.13 crore, exceeding Rs 255.73 crore generated from operations. Financing activities used a further Rs 104.01 crore.

Why did Akums' cash balance fall in six months?

Akums' cash balance fell because its Rs 255.73 crore operating inflow did not cover Rs 354.13 crore of investing outflows and Rs 104.01 crore of financing outflows. The resulting net cash decrease was Rs 202.41 crore for the six months ended 30 September 2026, compared with a Rs 127.91 crore increase in the corresponding 2025 period.

Cash and cash equivalents declined from Rs 386.01 crore on 31 March 2026 to Rs 183.59 crore on 30 September 2026. In the previous comparable period, cash rose from Rs 101.19 crore to Rs 229.10 crore, reflecting a Rs 1,152.21 crore operating inflow that was substantially higher than the current period's Rs 255.73 crore.

Akums prepared the consolidated cash-flow statement under the indirect method specified by Indian Accounting Standard 7, or Ind AS 7. It starts with profit before tax of Rs 293.98 crore for the 2026 half-year, then adjusts for items including Rs 84.28 crore of depreciation and amortisation, Rs 50.43 crore of finance costs and Rs 52.25 crore of interest income.

What used Akums' investing cash in the September half-year?

Akums used Rs 354.13 crore in investing activities, led by Rs 154.21 crore spent on property, plant and equipment and intangible assets, Rs 88.94 crore placed in net deposits with original maturities beyond three months, and Rs 56 crore paid for a business acquisition. The group also invested Rs 49.44 crore in bonds, commercial paper and other short-term investments, plus Rs 20.20 crore in mutual funds.

The Rs 154.21 crore capital-expenditure line includes property, plant and equipment, intangible assets, capital work-in-progress, capital advances and related payables. It was Rs 42.16 crore higher than the Rs 112.05 crore recorded in the six months ended 30 September 2025, while proceeds from sales of property, plant and equipment were Rs 4.72 crore and interest received was Rs 9.95 crore.

The acquisition outflow relates to Pure and Cure Healthcare Private Limited, a wholly owned Akums subsidiary, which completed the purchase of Oriflame India Private Limited's manufacturing business during the quarter ended 30 September 2026. The Rs 56 crore cash consideration covered manufacturing facilities in Roorkee and Noida and a leased warehouse; management said the acquisition is expected to expand capacity and the group's presence in color cosmetics, skincare and wellness.

Investing cash use was lower than Rs 1,006.53 crore in the prior-year period because that period included Rs 927.84 crore of net investment in deposits. The current half-year added investments in short-term instruments and mutual funds that did not appear in the comparative cash-flow statement.

Why did Akums' operating cash generation decrease?

Akums generated Rs 255.73 crore of net operating cash, down from Rs 1,152.21 crore a year earlier, as working-capital movements consumed cash despite a rise in operating profit before working-capital changes. That pre-working-capital measure increased to Rs 377.53 crore from Rs 242.77 crore, while profit before tax rose to Rs 293.98 crore from Rs 161.32 crore.

Inventories increased by Rs 133.48 crore, trade receivables by Rs 62.80 crore and other assets by Rs 63.80 crore in the current six-month period, reducing cash generated from operations. Those movements were partly offset by a Rs 161.39 crore increase in trade payables, a Rs 30 crore increase in other financial liabilities and a Rs 10.06 crore increase in provisions.

A key comparison is the movement in other liabilities: the current period recorded a Rs 20.21 crore decrease, while the comparable period recorded a Rs 951.09 crore increase. Consequently, gross cash generated from operations fell to Rs 298.69 crore from Rs 1,183.35 crore, before net income-tax payments of Rs 42.96 crore in 2026 and Rs 31.14 crore in 2025.

Which segments and assets changed during the period?

Akums' Contract Development and Manufacturing operations, or CDMO, drove the increase in revenue, with external revenue rising to Rs 2,079.08 crore from Rs 1,617.67 crore in the six months ended 30 September 2026. CDMO segment result increased to Rs 255.95 crore from Rs 137.10 crore, while the Active Pharmaceutical Ingredient, or API, segment reported a Rs 18.29 crore loss, narrower than the Rs 29.07 crore loss a year earlier.

International branded formulations recorded external revenue of Rs 78.33 crore, up from Rs 57.50 crore, and segment result rose to Rs 15.38 crore from Rs 12.62 crore. Domestic branded formulations revenue increased to Rs 247.20 crore from Rs 229.41 crore, but its segment result declined to Rs 33.84 crore from Rs 41.22 crore; group profit for the period nevertheless rose to Rs 215.54 crore from Rs 107.38 crore.

Property, plant and equipment rose to Rs 1,334.28 crore at 30 September 2026 from Rs 1,279.41 crore at 31 March 2026, while capital work-in-progress increased to Rs 245.90 crore from Rs 176.66 crore. Inventories rose to Rs 903.48 crore from Rs 755.71 crore, current investments reached Rs 70.85 crore from nil, and bank balances other than cash equivalents were Rs 1,425.51 crore compared with Rs 1,294.59 crore.

How did financing activities reduce Akums' cash?

Akums used Rs 104.01 crore in financing activities, compared with Rs 17.77 crore in the six months ended 30 September 2025. The current-period outflow comprised Rs 45.92 crore of dividends, Rs 36.80 crore of net repayment of current borrowings, Rs 10.99 crore of lease-principal payments, Rs 3.74 crore of lease-interest payments and Rs 6.56 crore of interest paid.

The dividend payment followed shareholder approval on 10 July 2026 of a Rs 1 final dividend and a Rs 2 special dividend per equity share for the year ended 31 March 2026. Of the Rs 47.22 crore total dividend liability, Rs 47.21 crore was paid during the quarter ended 30 September 2026, including Rs 1.29 crore to the Akums Employee Benefit Trust, with Rs 0.01 crore remaining unclaimed.

Current borrowings stood at Rs 36.15 crore on 30 September 2026, down from Rs 72.95 crore at 31 March 2026. Lease liabilities totalled Rs 80.91 crore across non-current and current categories, compared with Rs 84.48 crore at the previous financial year-end.

Conclusion

Akums' lower closing cash balance reflected investment deployment and financing payments exceeding operating cash generation in the six months ended 30 September 2026. Capital expenditure of Rs 154.21 crore, the Rs 56 crore Oriflame manufacturing-business acquisition, deposits and financial investments together accounted for the Rs 354.13 crore investing outflow, while operating cash was affected by higher inventory, receivables and other assets.

The next disclosed development to watch is management's plan to use the acquired Roorkee and Noida facilities to expand capacity in color cosmetics, skincare and wellness. An unresolved matter is the Rs 156.02 crore income-tax demand under appeal, against which Akums had deposited Rs 10.97 crore under protest by the filing date, including Rs 3.92 crore paid after the quarter ended.