Bharti Hexacom cuts net debt 44% despite Rs 900 crore dividend

Bharti Hexacom reduced net debt excluding lease obligations by 44% year on year to Rs 1,575.5 crore at September 30, 2026, even as it paid Rs 900 crore in dividend including tax during the quarter. The lower debt coincided with Rs 1,161.5 crore of operating cash flow and quarterly EBITDA of Rs 1,416.6 crore.

How much did Bharti Hexacom’s net debt fall?

Bharti Hexacom’s net debt excluding lease obligations fell by Rs 1,242.8 crore, from Rs 2,818.3 crore at September 30, 2025 to Rs 1,575.5 crore at September 30, 2026. Net debt including lease obligations declined by Rs 1,348.5 crore to Rs 4,950.4 crore, as lease obligations stood at Rs 3,374.9 crore at the latest reporting date.

The net-debt schedule shows lower payment liabilities and higher liquid financial assets compared with a year earlier. Deferred payment liability declined by Rs 222.6 crore to Rs 2,651.6 crore, while short-term borrowings and the current portion of long-term debt declined from Rs 252.2 crore to Rs 50 lakh. Cash, investments and receivables totalled Rs 1,076.7 crore at September 30, 2026, compared with Rs 308.1 crore a year earlier.

The presentation does not provide a net-debt total for June 30, 2026, so Bharti Hexacom’s quarter-on-quarter net-debt movement cannot be calculated from the disclosed schedule. Its September 2026 and September 2025 comparison is based on deferred payment liability, short-term debt, cash, investments and receivables, rather than on total balance-sheet borrowings alone.

What operating cash flow supported Bharti Hexacom’s debt reduction?

Bharti Hexacom generated Rs 1,161.5 crore of net cash from operating activities in the quarter ended September 2026, up Rs 34 crore from Rs 1,127.5 crore in the corresponding quarter of the prior year. Operating cash flow before changes in working capital increased to Rs 1,426.8 crore from Rs 1,262.8 crore, while profit before tax rose to Rs 701.1 crore from Rs 564.1 crore.

For the six months ended September 2026, operating cash flow was Rs 2,724 crore, compared with Rs 2,471.2 crore in the six months ended September 2025. The six-month increase of Rs 252.8 crore followed a rise in profit before tax to Rs 1,354.1 crore from Rs 1,090.9 crore and included Rs 300.2 crore of cash generated from operations before tax.

Bharti Hexacom reported cash profit from operations before derivative and exchange fluctuations of Rs 1,298.8 crore for the September 2026 quarter, up from Rs 1,112.7 crore a year earlier. This measure is distinct from reported operating cash flow: it is reconciled from profit from operating activities, finance costs and derivative or exchange movements, whereas the cash-flow statement also includes working-capital and tax effects.

How did investment and the dividend affect Bharti Hexacom’s cash?

Bharti Hexacom paid Rs 900 crore in dividend including tax in the September 2026 quarter, compared with Rs 500 crore in the corresponding quarter a year earlier. Financing activities used Rs 1,155.4 crore during the latest quarter, versus Rs 511.5 crore in September 2025, with the dividend representing the largest listed financing outflow.

Lease-liability payments were Rs 103.9 crore and interest and other finance charges paid were Rs 152 crore in the September 2026 quarter. The combination of operating, investing and financing cash flows reduced cash and cash equivalents by Rs 2.5 crore during the quarter, leaving Rs 7.5 crore at September 30, 2026, compared with Rs 10 crore at June 30, 2026.

Investing activities used Rs 8.6 crore in the September 2026 quarter, substantially below the Rs 629.9 crore outflow in the year-earlier quarter. A Rs 665.7 crore movement in current investments offset Rs 638.1 crore of net purchases or proceeds from property, plant and equipment, while the reported capital expenditure figure for the quarter was Rs 336.3 crore.

For the six months ended September 2026, investing activities used Rs 1,441.7 crore, compared with Rs 922.6 crore a year earlier. Net purchases or proceeds from property, plant and equipment accounted for Rs 997.9 crore of the six-month outflow, while the net movement in current investments used Rs 410.3 crore.

Did Bharti Hexacom’s earnings improve its debt ratios?

Bharti Hexacom reported lower annualised net-debt ratios at September 30, 2026 as net debt declined and quarterly earnings increased. Net debt to annualised EBITDA, including lease obligations, was 0.87 times, compared with 1.25 times at September 30, 2025. Its annualised ratio excluding the impact of leases was 0.31 times, down from 0.64 times a year earlier.

EBITDA, or earnings before interest, tax, depreciation and amortisation, rose 12.8% year on year to Rs 1,416.6 crore in the September 2026 quarter from Rs 1,256.4 crore. EBITDA margin increased to 54.9% from 54.2%, while revenue grew 11.4% to Rs 2,581.8 crore from Rs 2,317.3 crore.

Net income for the September 2026 quarter was Rs 566.1 crore, up from Rs 421.2 crore in the prior-year quarter. Net finance cost declined 16.5% to Rs 115.2 crore from Rs 138 crore, and profit before tax increased 24.3% to Rs 701.1 crore from Rs 564.1 crore.

What balance-sheet changes occurred during the September quarter?

Bharti Hexacom’s total equity was Rs 7,313.3 crore at September 30, 2026, down from Rs 7,647.3 crore at June 30, 2026. The Rs 334 crore reduction occurred in a quarter when the company reported Rs 566.1 crore of profit and paid Rs 900 crore of dividend including tax, although the presentation does not separately reconcile every movement in equity.

Current investments fell to Rs 823.4 crore at September 30, 2026 from Rs 1,723.8 crore at June 30, 2026, while other bank balances increased to Rs 274.3 crore from Rs 28 crore. Cash and bank balances were Rs 7.5 crore at September 30, compared with Rs 10 crore at June 30.

Balance-sheet borrowings, which are not the same as the company’s stated net-debt calculation, totalled Rs 602.7 crore at September 30, 2026, compared with Rs 612.6 crore at June 30, 2026. Non-current borrowings were Rs 518.1 crore and current borrowings were Rs 84.7 crore at September 30, while deferred payment liability is presented separately in the net-debt schedule.

Conclusion

Bharti Hexacom’s September 2026 disclosures show year-on-year deleveraging despite a larger shareholder distribution. Net debt excluding leases fell to Rs 1,575.5 crore from Rs 2,818.3 crore, supported by Rs 1,161.5 crore of quarterly operating cash flow, a Rs 1,416.6 crore EBITDA result and a decline in net finance cost to Rs 115.2 crore.

The unresolved point is the absence of a June 30, 2026 net-debt total in the disclosed schedule, which prevents a direct quarter-on-quarter calculation. Subsequent disclosures will show whether operating cash flow continues to cover investment, lease payments, finance charges and distributions, after September-quarter capital expenditure of Rs 336.3 crore and a Rs 900 crore dividend payment.