Arka Defence revenue jumps 479% as cash flow stays negative

Arka Defence & Locomotives Limited reported revenue of Rs 52.13 lakh for the quarter ended September 30, 2026, up 479% from Rs 9.00 lakh a year earlier, while operating cash flow for the six months was negative Rs 29.37 lakh after higher receivables and other current assets absorbed cash.

What did Arka Defence report for the September quarter?

Arka Defence reported revenue from operations of Rs 52.13 lakh for the quarter ended September 30, 2026, compared with Rs 9.00 lakh for the quarter ended September 30, 2025. The increase was Rs 43.13 lakh, or about 479% year on year. Revenue was also above Rs 50.27 lakh in the quarter ended June 30, 2026, a sequential increase of Rs 1.86 lakh.

Arka Defence reported net profit of Rs 5.52 lakh for the September 2026 quarter, compared with Rs 1.28 lakh in the September 2025 quarter. Employee-benefit expense rose to Rs 20.00 lakh from Rs 0.60 lakh, while other expenses increased to Rs 20.61 lakh from Rs 3.44 lakh. The increase in revenue therefore coincided with a larger reported cost base.

For the half year ended September 30, 2026, Arka Defence recorded revenue from operations of Rs 1.02 crore, compared with Rs 11.17 lakh in the corresponding period of 2025. Net profit for the six months was Rs 11.67 lakh, versus Rs 1.79 lakh a year earlier. Basic and diluted earnings per share were Rs 0.10, compared with Rs 0.03 in the prior-year half year.

Why was Arka Defence's operating cash flow negative?

Arka Defence reported negative net cash flow from operating activities of Rs 29.37 lakh for the half year ended September 30, 2026, despite profit before tax of Rs 11.67 lakh. Trade receivables absorbed Rs 71.99 lakh of cash, the largest working-capital movement in the cash-flow statement. Other current assets absorbed a further Rs 23.77 lakh during the six-month period.

Arka Defence's increases in other financial liabilities and other current liabilities partly offset the cash absorption. Other financial liabilities contributed Rs 27.45 lakh, and other current liabilities contributed Rs 29.02 lakh, while trade payables used Rs 1.75 lakh. These movements did not fully offset the receivables and other-current-assets increases, leaving cash generated from operations negative.

The operating cash outflow of Rs 29.37 lakh for the September 2026 half year was larger than the Rs 5.33 lakh negative operating cash flow reported for the year ended March 31, 2026. Arka Defence received Rs 26.77 lakh from short-term borrowings during the half year, limiting the decline in cash and cash equivalents to Rs 2.60 lakh. Closing cash was Rs 3.20 lakh on September 30, 2026, down from Rs 5.80 lakh on March 31, 2026.

How did Arka Defence's balance sheet change by September 2026?

Arka Defence's trade receivables rose to Rs 2.81 crore at September 30, 2026, from Rs 2.09 crore at March 31, 2026. The Rs 71.99 lakh increase matches the movement reported in the half-year cash-flow statement. Other current assets increased to Rs 1.44 crore from Rs 1.20 crore, adding Rs 23.77 lakh to working capital.

Total assets increased to Rs 5.86 crore on September 30, 2026, from Rs 4.92 crore on March 31, 2026, while non-current assets were unchanged at Rs 1.57 crore. Current assets rose to Rs 4.28 crore from Rs 3.35 crore. The balance sheet did not report inventories, property, plant and equipment, or intangible assets under development at September 30, 2026.

Current liabilities increased to Rs 1.32 crore from Rs 50.24 lakh over the six months. Borrowings rose to Rs 46.77 lakh from Rs 20.00 lakh, other financial liabilities increased to Rs 49.47 lakh from Rs 22.01 lakh, and other current liabilities rose to Rs 35.32 lakh from Rs 6.30 lakh. Total equity was Rs 4.54 crore, compared with Rs 4.42 crore at March 31, 2026.

What did the auditor say about Arka Defence's results?

Suresh Surana & Associates LLP issued a limited-review conclusion dated November 14, 2026, on Arka Defence's quarter and half-year financial results ended September 30, 2026. The auditor said nothing had come to its attention to indicate that the statements were not prepared, in all material respects, in accordance with the applicable Indian Accounting Standards and Regulation 33 of the Securities and Exchange Board of India listing regulations.

The review was conducted under Standard on Review Engagements 2410, which the auditor said provides moderate assurance and is substantially narrower in scope than an audit. The firm did not express an audit opinion. Its review covered the September 2026 quarterly and half-year results, the asset-and-liability statement at September 30, 2026, and the half-year cash-flow statement.

The auditor also noted that the financial results for the quarter and half year ended September 30, 2025 had been certified by Arka Defence's management and approved by its board, but had not been reviewed or audited by Suresh Surana & Associates LLP. The firm said its conclusion on the September 2026 statements was not modified in respect of that comparative-information matter.

Conclusion

Arka Defence's September 2026 filing shows reported quarterly revenue rising to Rs 52.13 lakh from Rs 9.00 lakh and net profit increasing to Rs 5.52 lakh from Rs 1.28 lakh. The half-year cash-flow statement, however, shows a Rs 29.37 lakh operating outflow, led by a Rs 71.99 lakh increase in receivables and a Rs 23.77 lakh increase in other current assets.

The next results will show whether the Rs 2.81 crore receivables balance at September 30, 2026 converts into operating cash and whether borrowings change after reaching Rs 46.77 lakh. Arka Defence also appointed Rohit Joshi as Company Secretary and Compliance Officer on November 14, 2026, the same date the board approved the unaudited results.