Indo National posts Rs 3.66 crore half-year pre-tax loss

Indo National Limited reported a standalone pre-tax loss of Rs 3.66 crore for the half year ended September 30, 2026, against a restated Rs 3.16 crore profit a year earlier, while operating activities used Rs 16.42 crore of cash as inventories rose by Rs 17.52 crore. A Rs 5.84 crore deferred-tax credit nevertheless produced Rs 2.18 crore of net profit.

Why did Indo National report a quarterly pre-tax loss?

Indo National reported a pre-tax loss of Rs 72.06 lakh for the quarter ended September 30, 2026, compared with a restated pre-tax profit of Rs 1.97 crore in the quarter ended September 30, 2025. Total income fell to Rs 119.74 crore from Rs 120.63 crore, while total expenses increased to Rs 120.47 crore from Rs 118.65 crore. No exceptional items were reported in either September 2026 period.

The September-quarter pre-tax loss narrowed from Rs 2.94 crore in the preceding quarter ended June 30, 2026. For the six months ended September 30, 2026, the pre-tax result was a Rs 3.66 crore loss, compared with a restated Rs 3.16 crore profit in the corresponding prior-year period. The prior-period figures were restated following the merger of Helios Strategic Systems Limited.

A deferred-tax credit of Rs 61 lakh reduced the quarterly loss after tax to Rs 11.06 lakh, versus a Rs 1.56 crore profit a year earlier. For the half year, the Rs 5.84 crore deferred-tax credit converted the pre-tax loss into a Rs 2.18 crore profit after tax, compared with restated half-year profit after tax of Rs 2.63 crore in 2025.

How did Indo National’s revenue and costs change?

Indo National’s revenue from operations declined by Rs 92 lakh year on year to Rs 118.15 crore in the September 2026 quarter. Half-year revenue declined by Rs 4.51 crore to Rs 234.00 crore, while other income fell to Rs 2.49 crore from Rs 3.76 crore. The company said consumer goods is its only reportable standalone segment.

Material consumption rose to Rs 46.55 crore in the September quarter from Rs 40.28 crore a year earlier. Purchases of stock-in-trade fell by Rs 6.06 crore to Rs 24.37 crore, but other expenses increased by Rs 1.13 crore to Rs 27.69 crore and finance costs rose by Rs 47.68 lakh to Rs 1.20 crore.

For the half year, material consumption increased to Rs 100.03 crore from Rs 82.76 crore, while stock-in-trade purchases decreased to Rs 45.51 crore from Rs 64.48 crore. Employee benefits increased to Rs 34.87 crore from Rs 34.62 crore, depreciation and amortisation rose to Rs 6.85 crore from Rs 6.47 crore, and other expenses increased to Rs 57.60 crore from Rs 52.94 crore.

The comparative figures incorporate Helios Strategic Systems Limited, a formerly wholly owned subsidiary that merged with Indo National. The National Company Law Tribunal, Chennai Bench approved the amalgamation on March 10, 2026, with an appointed date of April 1, 2024, and the merger became effective on April 2, 2026.

Why did Indo National’s operating cash outflow widen?

Indo National used Rs 16.42 crore in standalone operating activities during the half year ended September 30, 2026, compared with an outflow of Rs 8.95 crore in the prior-year half year. Inventory was the largest identified working-capital outflow, absorbing Rs 17.52 crore of cash compared with Rs 72.31 lakh a year earlier.

Operating profit before working-capital changes fell to Rs 4.10 crore from Rs 10.55 crore. Changes in working capital absorbed Rs 20.42 crore, versus Rs 19.20 crore in the prior-year period, including a Rs 9.25 crore decline in provisions and other liabilities and a Rs 1.55 crore increase in trade receivables.

Cash generated from operations was negative Rs 16.32 crore, compared with negative Rs 8.65 crore a year earlier. Net income taxes paid were Rs 10.22 lakh, down from Rs 30.15 lakh, taking reported operating cash outflow to Rs 16.42 crore. This differs from the Rs 2.18 crore half-year profit after tax because the cash-flow statement includes working-capital movements, non-cash depreciation and tax payments.

Investing activities used Rs 5.90 crore, compared with Rs 4.48 crore in the previous half year. Indo National spent Rs 15.67 crore on property, plant and equipment and Rs 38.80 crore on equity investments in Medicuore, Axial Aerospace and Aidin Technologies, partly offset by Rs 47.79 crore of cash from mutual-fund investments and Rs 77.51 lakh of interest received.

What changed in Indo National’s balance sheet and funding?

Indo National’s inventories stood at Rs 77.57 crore on September 30, 2026, up from Rs 60.05 crore on March 31, 2026. Trade receivables increased to Rs 59.72 crore from Rs 58.17 crore, while cash and cash equivalents fell to Rs 17.50 lakh from Rs 5.44 crore at the start of the financial year.

The cash-flow statement recorded a net decrease in cash and cash equivalents of Rs 5.26 crore in the half year, compared with a decrease of Rs 11.42 lakh in the corresponding 2025 period. Financing activities generated Rs 17.05 crore, including Rs 14.04 crore in long-term borrowing proceeds and net Rs 5.10 crore from short-term borrowings after Rs 34.21 crore of repayments.

Total borrowings were Rs 53.35 crore at September 30, 2026, comprising Rs 14.04 crore of non-current borrowings and Rs 39.31 crore of current borrowings. At March 31, 2026, Indo National had no non-current borrowings and Rs 34.21 crore of current borrowings. Total assets increased to Rs 434.87 crore from Rs 426.03 crore, while equity increased to Rs 304.85 crore from Rs 303.43 crore.

The filing also identifies two unresolved matters. Indo National deposited Rs 4.22 crore, equal to 10% of a Rs 42.26 crore Competition Commission of India penalty, with the National Company Law Appellate Tribunal registry while its appeal continues; it made no provision based on legal opinion. It also said it could not reliably estimate any further cost from Extended Producer Responsibility obligations under the Battery Waste Management Rules, 2022.

Conclusion

Indo National’s standalone half-year accounts show a shift from a restated Rs 3.16 crore pre-tax profit to a Rs 3.66 crore loss, alongside operating cash outflow that increased by Rs 7.47 crore year on year. The Rs 17.52 crore inventory build-up was the largest disclosed operating cash use, and the deferred-tax credit was material to the reported Rs 2.18 crore profit after tax.

The disclosed matters to watch are the company’s ability to estimate the financial impact of battery Extended Producer Responsibility compliance once regulatory and pricing arrangements are clarified, and developments in its appeal against the Rs 42.26 crore competition penalty. The filing states that Indo National is procuring Extended Producer Responsibility credits, but says the framework through the Central Pollution Control Board portal and credit-pricing mechanism remain under deliberation.