Campus Activewear cash flow turns negative on inventory

Campus Activewear Limited reported Rs 94.29 crore of net cash used in operating activities for the six months ended 30 September 2026, as inventories absorbed Rs 169.75 crore of cash. Campus Activewear ended the period with inventories of Rs 628.24 crore, current borrowings of Rs 78 crore and cash equivalents of Rs 2.94 crore.

How did working capital affect Campus Activewear's operating cash flow?

Working-capital movements turned Campus Activewear's Rs 115.66 crore operating profit before working-capital changes into cash used from operations during the six months ended 30 September 2026. Inventory absorbed Rs 169.75 crore, trade receivables absorbed Rs 37.88 crore and other current assets absorbed Rs 15.64 crore in the period.

The company partly offset those outflows through a Rs 30.02 crore increase in trade payables, a Rs 10.86 crore increase in other non-current financial liabilities and a Rs 2.52 crore increase in other current liabilities. Cash used in operating activities before tax was Rs 68.30 crore, while income-tax payments of Rs 25.99 crore resulted in net operating cash used of Rs 94.29 crore.

The reported outcome differs from the Rs 134.77 crore of net cash generated from operating activities in the year ended 31 March 2026. The periods are not directly comparable because the latest statement covers six months, but inventory cash absorption was Rs 169.75 crore in the six-month period, versus Rs 71.38 crore for the preceding full year.

How much did Campus Activewear's inventory and receivables rise?

Campus Activewear's inventories increased by Rs 178.79 crore to Rs 628.24 crore at 30 September 2026 from Rs 449.45 crore at 31 March 2026. The balance-sheet increase accompanies the Rs 169.75 crore inventory increase recorded in the six-month cash-flow statement, although the filing does not explain the difference between those reported measures.

Trade receivables rose by Rs 31.08 crore to Rs 183.83 crore at 30 September 2026, from Rs 152.75 crore at 31 March 2026. Other current assets increased to Rs 161.81 crore from Rs 146.17 crore, taking total current assets to Rs 983.62 crore from Rs 879.34 crore over the same period.

Cash and cash equivalents moved in the other direction, declining to Rs 2.94 crore at 30 September 2026 from Rs 3.96 crore at 31 March 2026. Loans fell to Rs 0.81 crore from Rs 1.27 crore, while other financial assets declined to Rs 0.99 crore from Rs 125.74 crore.

Did Campus Activewear increase short-term borrowings and preserve cash?

Campus Activewear's current borrowings increased to Rs 78 crore at 30 September 2026 from Rs 36.28 crore at 31 March 2026, a balance-sheet rise of Rs 41.72 crore. The financing cash-flow statement records gross proceeds from current borrowings of Rs 1,836.25 crore and gross repayments of Rs 1,792.54 crore, producing a reported net increase of Rs 43.71 crore.

Current liabilities rose to Rs 457.15 crore at 30 September 2026 from Rs 371.48 crore at 31 March 2026. Dues to creditors other than micro enterprises and small enterprises increased to Rs 190.62 crore from Rs 178.66 crore, while other current liabilities rose to Rs 66.64 crore from Rs 44.29 crore.

Investing activities generated Rs 103.57 crore during the six months, including Rs 187.78 crore of proceeds from maturity of bank deposits and Rs 1.75 crore of interest received. These inflows were reduced by Rs 63.05 crore invested in bank deposits and Rs 23.08 crore spent on property, plant and equipment, capital work-in-progress, intangible assets and related items.

Campus Activewear also made lease-related cash payments during the six months, including Rs 37.38 crore of principal repayments and Rs 8.32 crore of interest payments. Its non-current assets were Rs 584.57 crore at 30 September 2026, compared with Rs 587.85 crore at 31 March 2026, while property, plant and equipment declined to Rs 260.81 crore from Rs 262.63 crore.

What did the auditor report on Campus Activewear's September results?

B S R and Co said nothing had come to its attention that indicated Campus Activewear's unaudited results for the six months ended 30 September 2026 contained a material misstatement or inadequate disclosure under the listing regulations. The limited review report was dated 5 November 2026, the same date on which the board approved the results.

The auditor said a review is substantially narrower than an audit and does not provide assurance that all significant matters that might be identified in an audit would be found. Campus Activewear reported one operating segment, footwear and its related products, under Indian Accounting Standard 108, or Ind AS 108.

Campus Activewear incorporated Campus Foundation during the September 2026 quarter to discharge corporate social responsibility obligations. The filing states that the foundation had no activities or transactions at 30 September 2026, and Campus Activewear therefore did not prepare consolidated financial results for that quarter.

Conclusion

Campus Activewear's interim cash position reflects a substantial working-capital requirement: Rs 169.75 crore of inventory cash absorption and Rs 37.88 crore absorbed by receivables outweighed its Rs 115.66 crore operating profit before working-capital changes. The period closed with inventory at Rs 628.24 crore, current borrowings at Rs 78 crore and cash equivalents at Rs 2.94 crore.

The unresolved working-capital movements in inventory, receivables and current borrowings will be the central items to monitor after 30 September 2026. Campus Activewear also disclosed that Campus Foundation had been incorporated for corporate social responsibility obligations but had recorded no activity or transaction by the reporting date.