CSM Technologies operating cash outflow widens to Rs 70.97 crore

CSM Technologies Limited reported Rs 70.97 crore of net cash used in operating activities for the half year ended September 30, 2026, compared with Rs 15.45 crore used a year earlier. The wider outflow followed a Rs 45.32 crore increase in other assets and a pre-tax loss of Rs 24.60 crore, against prior-year pre-tax profit of Rs 8.42 crore.

Why did CSM Technologies use Rs 70.97 crore in operations?

CSM Technologies used Rs 70.97 crore in operations because cash generated from operations was negative Rs 66.42 crore before net tax payments in the half year ended September 30, 2026. In the corresponding 2025 half year, cash generated from operations was negative Rs 13.69 crore and net cash used in operating activities was Rs 15.45 crore.

The largest disclosed working-capital movement was a Rs 45.32 crore increase in other assets during the 2026 half year, compared with a Rs 10.62 crore increase in the prior-year period. Trade receivables also increased by Rs 3.68 crore, while other financial assets increased by Rs 66.36 lakh, each reducing cash generated from operations.

The cash-flow reconciliation began with a pre-tax loss of Rs 24.60 crore for the latest half year, reversing from pre-tax profit of Rs 8.42 crore a year earlier. Depreciation and amortisation of Rs 3.09 crore and finance costs of Rs 4.16 crore were included as adjustments, but they did not offset the loss and working-capital movements.

How did CSM Technologies’ operating cash use change year on year?

CSM Technologies’ operating cash outflow widened by Rs 55.52 crore year on year, from Rs 15.45 crore in the half year ended September 30, 2025 to Rs 70.97 crore in the latest period. Other assets increased by Rs 34.70 crore more than in the prior-year half, alongside the shift from pre-tax profit to loss.

Revenue from operations declined to Rs 84.97 crore in the six months ended September 30, 2026 from Rs 100.89 crore a year earlier. Employee benefits expense rose to Rs 68.30 crore from Rs 50.88 crore, and cost of materials consumed increased to Rs 7.60 crore from Rs 5.74 crore, while cost of services rendered fell to Rs 17.27 crore from Rs 18.64 crore.

Trade payables decreased by Rs 5.30 crore in the latest half year, compared with a Rs 6.49 crore decrease in the earlier period. Other current liabilities decreased by Rs 24.56 lakh in 2026, versus a Rs 2.47 crore decrease in 2025, showing that liability movements differed across the two periods while the overall operating cash balance worsened.

CSM Technologies reported a consolidated loss for the period of Rs 18.48 crore in the half year ended September 30, 2026, compared with profit of Rs 6.04 crore in the corresponding period. Revenue fell by Rs 15.92 crore, while employee benefits expense rose by Rs 17.42 crore, which together help explain the change in profitability feeding into the operating cash-flow reconciliation.

Where did CSM Technologies deploy cash outside operations?

CSM Technologies used Rs 29.51 crore in investing activities during the half year ended September 30, 2026, compared with Rs 5.67 crore in the prior-year period. The largest disclosed item was Rs 20.07 crore invested in intangible assets under development, against Rs 2.08 crore in the corresponding 2025 half year.

The balance of intangible assets under development reached Rs 30.32 crore at September 30, 2026, up from Rs 10.25 crore at March 31, 2026. CSM Technologies identified AI Foundry, Plantrix, Dynamic Framework, E-Sign Engine, Aadhaar Data Vault and Tendrils ERP as the principal products and technology platforms underlying that balance.

CSM Technologies also reported purchases of property, plant and equipment worth Rs 1.94 crore and intangible assets worth Rs 1.42 crore in the latest half year. The company said expenditure on development is capitalised only when the recognition criteria in Indian Accounting Standard 38, or Ind AS 38, are met, including technical feasibility and the probability of future economic benefits.

Management said completed products or identifiable modules will be transferred to the appropriate intangible-asset category and amortised when available for intended use. The company said it periodically reviews the development status, technical feasibility, security architecture, regulatory compliance, commercial viability and expected future economic benefits of each product.

How did IPO proceeds affect CSM Technologies’ liquidity?

CSM Technologies generated Rs 115.26 crore of net cash from financing activities in the half year ended September 30, 2026, compared with Rs 27.06 crore a year earlier. The financing inflow included Rs 145.78 crore of proceeds from the issue of equity shares and exceeded the combined Rs 100.48 crore operating and investing cash outflows.

CSM Technologies completed its initial public offering, or IPO, of 1,29,01,000 equity shares with a face value of Rs 10 each at an issue price of Rs 113 per share on June 30, 2026. The shares were listed on the National Stock Exchange of India Limited and BSE Limited on July 2, 2026, while the company recognised Rs 12.90 crore in additional equity share capital and Rs 132.88 crore in securities premium.

Financing cash use included Rs 36.40 crore of long-term borrowing repayments, Rs 4.16 crore of interest and other borrowing costs, Rs 2.32 crore of dividend payments and Rs 51.73 lakh of lease-liability repayments. CSM Technologies received Rs 12.88 crore from long-term borrowings during the same six-month period.

Cash and cash equivalents rose to Rs 20.08 crore at September 30, 2026 from Rs 5.43 crore at the period’s start. Other bank balances were Rs 5.72 crore, while combined current and non-current borrowings declined to Rs 46.99 crore at September 30 from Rs 69.71 crore at March 31, 2026.

Conclusion

CSM Technologies’ first-half cash flow shows that IPO-related financing covered both the Rs 70.97 crore operating outflow and Rs 29.51 crore investing outflow, resulting in closing cash and cash equivalents of Rs 20.08 crore. The principal disclosed driver of the larger operating deficit was the Rs 45.32 crore increase in other assets, alongside the move to a Rs 24.60 crore pre-tax loss.

The next disclosed items to watch are progress on the Rs 30.32 crore intangible-assets-under-development balance and the availability for use of its products or modules, which would trigger transfer and amortisation. CSM Technologies also disclosed that its final dividend of Rs 0.50 per share for the year ended March 31, 2026, approved on September 29, 2026, is expected to result in cash outflow of about Rs 2.58 crore during FY 2026-27.