Gujarat Craft turns operating cash positive at Rs 6.1039 crore

Gujarat Craft Industries Limited generated Rs 6.1039 crore in net cash from operating activities in the half year ended September 30, 2026, reversing a Rs 1.28 crore outflow in the corresponding 2025 period. Investing and financing outflows nevertheless reduced Gujarat Craft's cash and cash equivalents to Rs 2.71 lakh at period end.

How did Gujarat Craft's operating cash flow change?

Gujarat Craft moved to a Rs 6.1039 crore operating cash inflow in the half year ended September 30, 2026, from a Rs 1.28 crore outflow in the corresponding 2025 half year. Cash generated from operations was Rs 6.1154 crore, compared with cash used in operations of Rs 1.0179 crore a year earlier, while direct taxes paid net of refunds fell to Rs 1.15 lakh from Rs 26.21 lakh.

The operating cash reversal did not coincide with higher reported pre-tax profit. Profit before tax was Rs 24.85 lakh for the September 2026 half year, down from Rs 1.3333 crore in the prior-year period. Under the indirect cash-flow method, Gujarat Craft added back Rs 3.2211 crore of depreciation and amortisation, while operating profit before working-capital changes was Rs 6.4501 crore, against Rs 7.1711 crore a year earlier.

What working-capital movements affected Gujarat Craft's cash generation?

Gujarat Craft's working-capital movements were mixed, with a Rs 9.0338 crore increase in trade receivables reducing cash during the September 2026 half year. Trade payables reduced cash by Rs 3.6879 crore, while other current liabilities contributed Rs 3.0541 crore. These movements formed part of the bridge between the Rs 6.4501 crore operating-profit figure and Rs 6.1154 crore of cash generated from operations.

Other disclosed movements were smaller but also affected the result. Other current financial liabilities declined by Rs 19.94 lakh, short-term provisions declined by Rs 0.99 lakh and long-term provisions declined by Rs 4.67 lakh. Other current assets used Rs 17.90 lakh, while other current financial assets contributed Rs 12.69 lakh and other non-current financial assets contributed Rs 4.82 lakh.

The September 30, 2026 balance sheet gives context to the receivables movement. Trade receivables were Rs 30.1987 crore, compared with Rs 21.1816 crore at March 31, 2026. Inventories fell to Rs 47.8682 crore from Rs 57.1264 crore, while total current assets rose to Rs 89.1142 crore from Rs 88.7563 crore over the same period.

Why did Gujarat Craft's closing cash remain low?

Gujarat Craft's closing cash remained at Rs 2.71 lakh because its Rs 6.1039 crore operating inflow was offset by Rs 1.113 crore used in investing activities and Rs 4.9966 crore used in financing activities. The cash-flow statement reported a net decrease of Rs 0.51 lakh, from an opening cash and cash-equivalents balance of Rs 3.28 lakh to a closing balance of Rs 2.71 lakh.

The Rs 2.71 lakh closing balance was below the Rs 20.68 lakh reported at the end of the September 2025 half year. Gujarat Craft presented cash and cash equivalents within current financial assets, separately from loans of Rs 2.8804 crore and other current financial assets of Rs 1.0367 crore as at September 30, 2026. The filing therefore distinguishes cash from its other financial-asset balances.

Current obligations provide additional balance-sheet context, although they are not equivalent to cash paid during the half year. Gujarat Craft reported current lease liabilities of Rs 2.9061 crore and trade payables to creditors other than micro and small enterprises of Rs 12.3113 crore at September 30, 2026. Its cash-flow statement separately records payments and borrowing movements made during the period.

How did Gujarat Craft's investing and financing cash flows compare with last year?

Gujarat Craft used Rs 1.113 crore in investing activities in the September 2026 half year, compared with Rs 1.2531 crore in the prior-year half. Purchases of property, plant and equipment, including right-of-use assets, capital work in progress and capital advances, were Rs 27.77 lakh, down from Rs 1.0066 crore a year earlier. The company also received Rs 5.11 lakh from asset sales and Rs 6.53 lakh of interest.

Financing cash flow changed to a Rs 4.9966 crore outflow from a Rs 2.6616 crore inflow in the September 2025 half year. Net repayment of non-current borrowings was Rs 2.0621 crore, while current borrowings provided a net Rs 1.4487 crore, compared with a net Rs 8.2937 crore contribution from current borrowings in the earlier period. Interest paid, including interest on lease obligations, was Rs 2.8551 crore, against Rs 2.6121 crore.

Lease and shareholder-related payments also contributed to the latest financing outflow. Gujarat Craft paid Rs 1.2801 crore towards the principal portion of lease obligations, compared with Rs 85.04 lakh in the earlier half year, and paid dividends of Rs 24.44 lakh. Non-current lease liabilities were Rs 4.4543 crore at September 30, 2026, while the company also reported non-current borrowings on its balance sheet.

What should readers monitor in Gujarat Craft's next filing?

Readers should monitor whether Gujarat Craft converts receivables into cash while meeting its investing and financing commitments. Revenue from operations rose to Rs 96.4813 crore in the September 2026 half year from Rs 92.0337 crore a year earlier, yet the cash-flow statement recorded a Rs 9.0338 crore receivables-related outflow. The next filing can show whether that working-capital use reverses or continues.

Gujarat Craft reports one operating segment, plastic packing material, and therefore does not provide segment reporting under Indian Accounting Standard 108. Its September 2026 half-year financial results were unaudited and reviewed by Kantilal Patel & Co. The review report dated November 4, 2026 stated that nothing had come to the auditor's attention to suggest the statement did not disclose required information or contained a material misstatement.

Conclusion

Gujarat Craft's first-half cash-flow statement shows an operating reversal, with Rs 6.1039 crore of net operating cash generated after a Rs 1.28 crore outflow a year earlier. The change came despite pre-tax profit falling to Rs 24.85 lakh from Rs 1.3333 crore, and it was followed by Rs 1.113 crore of investing outflow and Rs 4.9966 crore of financing outflow.

The next filing will be relevant for cash conversion because trade receivables used Rs 9.0338 crore of cash and ended at Rs 30.1987 crore on September 30, 2026. It will also show the effect of further interest payments, which were Rs 2.8551 crore in the latest half year, and lease-principal payments of Rs 1.2801 crore. The filing discloses no cash-flow target or financing plan.