Steamhouse carries Rs 281.62 crore debt amid 0.36 liquidity

Steamhouse India Limited reported Rs 281.62 crore of consolidated borrowings at March 31, 2026, while its Rs 122.13 crore of current assets covered only 36% of Rs 336.60 crore of current liabilities. Steamhouse also reported that Rs 280.90 crore of its borrowings carried variable interest rates, exposing profit before tax to changes in lending benchmarks.

Why are Steamhouse's current liabilities greater than its current assets?

Steamhouse had negative working capital of Rs 214.47 crore at March 31, 2026 because current liabilities of Rs 336.60 crore exceeded current assets of Rs 122.13 crore. Working capital is the difference between current assets and current liabilities. The 0.36 current ratio means reported current assets equalled Rs 0.36 for every Rs 1 of current liabilities.

The position widened from March 31, 2025, when Steamhouse reported current assets of Rs 115.03 crore, current liabilities of Rs 250.17 crore and negative working capital of Rs 135.19 crore. Current assets increased by Rs 7.10 crore, but current liabilities rose by Rs 86.43 crore, increasing negative working capital by Rs 79.28 crore. Steamhouse attributed the Fiscal 2026 decline in the current ratio mainly to higher trade payables resulting from improved supplier credit terms.

Steamhouse's ratio disclosures also say the earlier rise in current liabilities was driven mainly by increased raw-material procurement on credit from suppliers in Fiscal 2025. Supplier credit can defer cash payments for purchases, but trade payables remain obligations within the working-capital position. The company reported trade payables of Rs 93.23 crore at March 31, 2026, compared with Rs 78.04 crore at March 31, 2025.

How is Steamhouse's Rs 281.62 crore borrowing stack structured?

Steamhouse's consolidated borrowing balance was Rs 281.62 crore at March 31, 2026, up Rs 58.67 crore from Rs 222.95 crore at March 31, 2025. Its contractual-maturity disclosure placed Rs 192.50 crore of borrowings within 12 months and Rs 99.13 crore after 12 months. The disclosure is based on the earliest date on which the group can be required to pay and includes principal and interest cash flows.

Total non-derivative financial liabilities were Rs 444.60 crore at March 31, 2026, compared with Rs 360.85 crore at March 31, 2025. In addition to borrowings, the March 2026 total included Rs 53.71 crore of lease liabilities, Rs 93.23 crore of trade payables and Rs 16.04 crore of other financial liabilities. Of the total, Rs 291.43 crore was shown within 12 months and Rs 153.17 crore after 12 months.

Steamhouse's financial-risk notes do not identify a capital-expenditure programme, an expansion project or the use of the Rs 58.67 crore increase in borrowings. The disclosures establish that debt and total non-derivative liabilities increased between March 2025 and March 2026. They do not establish that a specific funded expansion caused that increase.

How exposed is Steamhouse to changes in interest rates?

Steamhouse is predominantly exposed to variable interest rates because it reported Rs 280.90 crore of variable-rate borrowings at March 31, 2026, against Rs 71.90 lakh of fixed-rate borrowings. The company says its interest-rate risk arises principally from movements in the Marginal Cost of Funds based Lending Rate, or MCLR, a lending benchmark used by banks.

Steamhouse estimated that a 100-basis-point rise in interest rates would reduce consolidated profit before tax by Rs 2.81 crore at March 31, 2026, with other variables held constant. A basis point is one-hundredth of a percentage point, so the stated scenario is a one-percentage-point change. The estimate assumes the floating-rate liability outstanding at the reporting date remained outstanding throughout the year.

The comparable profit-before-tax effect of a 100-basis-point increase was Rs 2.21 crore at March 31, 2025, when variable-rate borrowings were Rs 221.43 crore. The sensitivity increased by Rs 0.60 crore as variable-rate borrowings rose by Rs 59.47 crore. Steamhouse does not disclose an interest-rate hedge in these notes.

Steamhouse reported net liabilities of Rs 281.44 crore after deducting Rs 17.90 lakh of cash and cash equivalents from borrowings at March 31, 2026. Against total equity of Rs 172.77 crore, it reported a net debt-equity ratio of 1.63, compared with 1.67 at March 31, 2025. The ratio changed as total equity rose from Rs 132.45 crore while net liabilities increased from Rs 220.77 crore.

Can coal-cost pass-through limit Steamhouse's financial exposure?

Steamhouse says coal is its main commodity exposure and that a substantial part of coal cost is passed through to consumers. Management therefore states that commodity-price exposure is not likely to have a material financial impact on the group. This assessment depends on the company continuing to pass actual coal costs through to customers.

Steamhouse also reports exposure to the United States dollar-to-rupee exchange rate principally through coal imports. It says actual rupee costs of imported coal are substantially passed on to consumers, but states that it does not follow a hedging policy for these exposures. The company further says foreign-currency principal receivables and payables have not been hedged using forward contracts.

The stated pass-through mechanism addresses commodity and coal-import currency costs, rather than the timing of obligations. At March 31, 2026, the contractual-maturity schedule listed Rs 192.50 crore of borrowings, Rs 93.23 crore of trade payables, Rs 10.25 crore of lease liabilities and Rs 5.45 crore of other financial liabilities within 12 months. Steamhouse defines liquidity risk as insufficient funds to meet financial obligations when due.

What do collections and supplier credit mean for Steamhouse?

Steamhouse reported consolidated net credit sales of Rs 478.35 crore and average trade receivables of Rs 34.77 crore for the year ended March 31, 2026, producing a trade-receivables turnover ratio of 13.76. The comparable ratio was 14.83 in the preceding period, when net credit sales were Rs 395.11 crore and average receivables were Rs 26.64 crore. The decline in the ratio occurred as average receivables rose faster than the turnover measure.

Supplier credit was also more prominent in the reported figures. Average trade payables were Rs 85.64 crore at March 31, 2026 versus Rs 57.26 crore at March 31, 2025, while net credit purchases rose to Rs 337.67 crore from Rs 283.55 crore. Steamhouse says its trade-payables turnover ratio deteriorated due to increased credit purchases in Fiscal 2025.

Steamhouse describes its customer base as large, widely dispersed and secured with security deposits, characterising concentration of credit risk as very limited. It manages credit risk through approvals, credit limits and continuous customer-creditworthiness monitoring. Under Indian Accounting Standard 109, or Ind AS 109, Steamhouse uses an expected-credit-loss matrix to assess impairment on trade receivables and other financial assets.

Conclusion

Steamhouse's March 31, 2026 disclosures show Rs 281.62 crore of consolidated borrowings within a negative working-capital structure, with a 0.36 current ratio and Rs 280.90 crore of variable-rate debt. The company attributes the decline in liquidity coverage principally to higher trade payables from supplier credit, while its coal-cost pass-through statement concerns commodity and import-currency costs rather than contractual payment dates.

The next disclosed matters to watch are Rs 192.50 crore of borrowings due within 12 months, movements in MCLR-linked rates and whether coal and imported-coal rupee costs continue to be substantially passed to consumers. Steamhouse says it manages liquidity through sufficient cash and committed credit lines, but the notes do not disclose the use of the increase in borrowings or a forward-contract hedge for foreign-currency principal exposures.