Chemplast Sanmar operating cash reaches Rs 458 crore in H1

Chemplast Sanmar generated Rs 458 crore of net cash from operating activities in the six months ended September 2026 despite a Rs 241 crore consolidated profit-before-tax loss, because a Rs 448 crore working-capital change lifted cash generated from operations to Rs 461 crore. Investing and financing outflows left cash and cash equivalents at Rs 430 crore.

How did Chemplast Sanmar generate cash despite a pre-tax loss?

Chemplast Sanmar generated Rs 458 crore of operating cash because its Rs 241 crore consolidated profit-before-tax loss was offset by Rs 254 crore of non-cash and other investment or financial-item adjustments, followed by a Rs 448 crore favourable change in working capital. Operating profit before working-capital changes was Rs 14 crore, showing that the reported working-capital movement was the main contributor to the cash result.

The Sep-25 comparison was different. Chemplast Sanmar reported a smaller Rs 149 crore pre-tax loss and Rs 205 crore of adjustments, producing Rs 56 crore of operating profit before working-capital changes. A Rs 74 crore working-capital change then resulted in Rs 130 crore of cash generated from operations and Rs 126 crore of operating cash after Rs 4 crore of net direct taxes paid.

Chemplast Sanmar recorded Rs 332 crore more operating cash in Sep-26 than in Sep-25, while the pre-tax loss widened by Rs 92 crore. Net tax paid declined by Rs 1 crore to Rs 3 crore, a smaller contributor to the increase. The cash-flow statement does not break down the Rs 448 crore working-capital movement into individual balance-sheet accounts.

What changed in Chemplast Sanmar's working capital and balance sheet?

Chemplast Sanmar's balance sheet recorded movements consistent with a large working-capital release, notably trade payables increasing by Rs 533 crore to Rs 2,170 crore between Mar-26 and Sept-26. Other current liabilities fell by Rs 152 crore to Rs 62 crore, while derivative assets declined by Rs 83 crore to Rs 4 crore. The presentation does not allocate these individual movements directly to the Rs 448 crore working-capital line.

Several current assets moved in the opposite direction during the same period. Inventories rose by Rs 15 crore to Rs 617 crore, trade receivables decreased by Rs 10 crore to Rs 82 crore and other current assets increased by Rs 7 crore to Rs 150 crore. Total current assets declined by Rs 61 crore to Rs 1,420 crore, while current liabilities increased by Rs 307 crore to Rs 3,245 crore.

Total consolidated equity fell by Rs 181 crore to Rs 1,574 crore at Sept-26 from Rs 1,755 crore at Mar-26. Chemplast Sanmar also reported a Rs 181 crore consolidated profit-after-tax loss for H1FY'27, the first half of financial year 2027. Its cash-flow statement starts with the Rs 241 crore pre-tax loss and then adds back non-cash, investment and financial items before working-capital changes.

Why did operating cash not increase Chemplast Sanmar's cash balance?

Chemplast Sanmar's Rs 458 crore operating inflow was absorbed by Rs 144 crore of net investing outflows and Rs 314 crore of net financing outflows. The resulting net increase in cash and cash equivalents was Rs 5 lakh. Cash and cash equivalents therefore remained at Rs 430 crore at Sept-26, the same rounded value as the Rs 430 crore opening balance.

Investing cash use was Rs 2 crore higher than the Rs 142 crore reported in Sep-25, while financing outflows increased by Rs 227 crore from Rs 87 crore. In Sep-25, combined investing and financing outflows of Rs 229 crore exceeded the Rs 126 crore operating inflow. This led to a Rs 102 crore reduction in cash and cash equivalents to Rs 452 crore at the end of that half-year.

Borrowings declined during the current half. Non-current borrowings fell by Rs 98 crore to Rs 1,007 crore and current borrowings declined by Rs 105 crore to Rs 742 crore, taking combined borrowings down by Rs 203 crore to Rs 1,749 crore at Sept-26. The presentation does not specify how much of the Rs 314 crore financing outflow relates to debt repayments or other financing items.

What does Chemplast Sanmar's operating performance show alongside cash flow?

Chemplast Sanmar's consolidated revenue rose 15% to Rs 2,448 crore in H1FY'27 from Rs 2,133 crore in H1FY'26, but earnings before interest, tax, depreciation and amortisation, or EBITDA, moved to a Rs 3 crore loss from Rs 60 crore of EBITDA. Depreciation increased by Rs 11 crore to Rs 116 crore and finance cost rose by Rs 7 crore to Rs 127 crore, alongside the Rs 241 crore pre-tax loss.

The half-year result reflected a sharp difference between the two quarters. Q2 FY'27 produced Rs 111 crore of EBITDA on Rs 1,323 crore of revenue, compared with a Rs 115 crore EBITDA loss on Rs 1,125 crore of revenue in Q1 FY'27. Q2 FY'27 profit before tax was a Rs 9 crore loss, against a Rs 232 crore loss in Q1 FY'27, and the presentation does not explain the quarterly movement.

Segment revenue growth was led by Specialty Chemicals, where sales rose by Rs 189 crore to Rs 915 crore in H1FY'27. Suspension PVC revenue increased by Rs 153 crore to Rs 1,284 crore, while Value-Added Chemicals revenue fell by Rs 27 crore to Rs 249 crore. Consolidated sales volume declined by 30,628 metric tons to 266,717 metric tons, including a 17,145-metric-ton reduction in Suspension PVC volume.

Conclusion

Chemplast Sanmar's Sep-26 cash flow differed from its accounting result: a Rs 241 crore pre-tax loss coincided with Rs 458 crore of operating cash, principally because working capital contributed Rs 448 crore. That inflow did not expand the cash balance because Rs 144 crore of investing outflow and Rs 314 crore of financing outflow almost matched the operating inflow.

The next reported period will indicate whether the Rs 448 crore working-capital contribution recurs, as the presentation does not identify the underlying components in the cash-flow statement. It will also show whether Q2 FY'27 EBITDA of Rs 111 crore follows the Rs 115 crore Q1 FY'27 EBITDA loss and whether additional financing outflows change the Rs 1,749 crore borrowing balance reported at Sept-26.