Complete Sports profit rose but receivables drained cash

Complete Sports & Management India Limited reported profit after tax of Rs 17.9532 crore for the period ended 31 March 2026, but net cash used in operating activities was Rs 3.8209 crore. A Rs 35.6379 crore increase in trade receivables exceeded the Rs 25.0035 crore operating profit before working-capital changes.

Why did Complete Sports profit not turn to cash?

Complete Sports generated accounting profit but not operating cash because working-capital movements absorbed more than its operating earnings in the period ended 31 March 2026. Profit before tax was Rs 24.1935 crore, while adjustments including depreciation, finance costs and interest income resulted in operating profit before working-capital changes of Rs 25.0035 crore. Cash generated from operations was instead an outflow of Rs 1.1613 crore before net tax paid of Rs 2.6596 crore, resulting in an operating cash outflow of Rs 3.8209 crore.

Trade receivables, or customer amounts due for recognised goods or services, were the largest disclosed cash use. The cash-flow statement records a Rs 35.6379 crore increase in trade receivables for the period ended 31 March 2026. That use alone exceeded operating profit before working-capital changes, preventing reported earnings from converting into positive operating cash during the period.

The difference reflects the company's revenue-recognition policy. Complete Sports recognises revenue from goods generally upon delivery, when significant ownership risks and rewards transfer, and recognises service revenue as services are rendered under customer agreements. Those policies can record revenue and profit before customer payment is received, increasing receivables without a corresponding increase in cash.

How did receivables reshape Complete Sports working capital?

Complete Sports' trade receivables rose to Rs 47.941 crore at 31 March 2026 from Rs 12.3033 crore at 31 March 2025. The Rs 35.6377 crore balance-sheet increase closely corresponds with the Rs 35.6379 crore working-capital adjustment in the cash-flow statement, with the small difference arising from the separately presented disclosures.

Receivables became the largest disclosed current asset at 31 March 2026. They represented about 71% of Rs 67.284 crore in current assets, compared with about 21% of Rs 57.9735 crore at 31 March 2025. Inventories fell to Rs 10.0508 crore from Rs 24.1017 crore, while short-term loans and advances fell to Rs 8.3766 crore from Rs 20.6798 crore, but those reductions did not offset the receivables build-up.

Other working-capital movements partly reduced the cash drain. Lower inventories released Rs 14.0509 crore and lower loans and advances released Rs 12.3032 crore in the March 2026 cash-flow calculation. However, other current liabilities declined by Rs 16.5676 crore, creating an additional cash use, while trade payables increased by Rs 2.0636 crore.

What changed between 2024, 2025 and 2026?

Complete Sports increased revenue and profit in each of the three reported periods, while operating cash flow moved from an inflow in 2024 to outflows in 2025 and 2026. Revenue from operations was Rs 113.5602 crore for the period ended 31 March 2026, compared with Rs 110.3457 crore for the year ended 31 March 2025 and Rs 81.5042 crore for the year ended 31 March 2024. Profit after tax increased to Rs 17.9532 crore from Rs 11.4094 crore and Rs 10.1176 crore, respectively.

The cash-flow change was concentrated in receivables. The trade-receivables adjustment was an outflow of Rs 2.5729 crore in the year ended 31 March 2024, Rs 4.6928 crore in the year ended 31 March 2025 and Rs 35.6379 crore in the period ended 31 March 2026. Operating profit before working-capital changes increased from Rs 12.8889 crore in 2024 to Rs 25.0035 crore in 2026, indicating that the cash-flow reversal arose from balance-sheet movements rather than lower reported operating profit.

Which cash flows offset the receivables drain?

Complete Sports generated Rs 5.6792 crore from financing activities in the period ended 31 March 2026. The company received Rs 5.7114 crore from short-term borrowings and Rs 1.2987 crore from long-term borrowings, while interest and other borrowing costs used Rs 1.1146 crore and long-term borrowing repayment used Rs 21.62 lakh. Short-term borrowings rose to Rs 7.8856 crore at 31 March 2026 from Rs 2.1742 crore a year earlier.

Investing activities used Rs 2.0691 crore in the March 2026 period. Purchases of property, plant and equipment used Rs 3.176 crore, capital work-in-progress used Rs 56.80 lakh, and other long-term loans and advances used Rs 97.90 lakh. A Rs 2.5618 crore term-deposit movement, together with Rs 13.91 lakh of interest received and Rs 7.81 lakh of rent received, partly offset these uses.

The operating, investing and financing movements reduced cash and cash equivalents by Rs 21.08 lakh during the period ended 31 March 2026. Closing cash and cash equivalents were Rs 55.94 lakh, compared with an opening balance of Rs 77.02 lakh. The comparatively limited reduction in cash reflected financing inflows rather than a cash surplus from operations.

What does Complete Sports' revenue policy mean for cash timing?

Complete Sports' policies allow revenue to be recognised before cash collection when contractual delivery or service performance has occurred. Goods revenue is generally recognised on delivery, and services revenue is recognised as services are rendered. Sales are presented net of Goods and Services Tax, trade discounts and returns where applicable.

For service contracts, revenue exceeding billed amounts at year-end is recognised as unbilled revenue under other financial assets when it is recoverable without further services. Cash received before services are delivered is recorded as advances from customers. The March 2026 disclosures do not provide customer-level receivables ageing, collection dates, contract terms or a stated reason for the Rs 35.6379 crore receivables cash-flow movement.

The company identifies 12 months as its operating cycle, defined as the time between acquiring assets for processing and realising them in cash and cash equivalents. That classification supports current-asset presentation but does not establish when individual customer balances will be collected. Positive operating cash flow would depend on collections from the Rs 47.941 crore receivables balance and on future working-capital changes.

Conclusion

Complete Sports reported higher profit and revenue for the period ended 31 March 2026, but the conversion of earnings into operating cash deteriorated. The Rs 35.6379 crore receivables increase, together with a Rs 16.5676 crore decline in other current liabilities, outweighed cash released from inventories and loans and advances and resulted in a Rs 3.8209 crore operating cash outflow.

The next disclosed matter to watch is whether the Rs 47.941 crore trade-receivables balance converts into cash within the company's stated 12-month operating cycle. The restated financial information provides no collection plan, receivables-ageing schedule or later cash-flow update, leaving the timing and extent of collections unresolved.