TNA Solutions’ export shift extended debtor days to 128

TNA Solutions’ export-led revenue mix coincided with debtor days rising to 128 in FY2026 from 40 in FY2024. Trade receivables reached Rs 36.54 crore, or 34.94% of FY2026 revenue, as export customers accounted for 81.40% of outstanding receivables and were granted commercially agreed credit periods.

Why did TNA Solutions’ debtor days rise to 128?

TNA Solutions’ debtor days increased because receivables grew substantially faster than revenue between FY2024 and FY2026. Debtor days measure the estimated time taken to collect trade receivables, while the trade-receivables turnover ratio measures how often receivables are collected during a year. TNA Solutions reported 128 debtor days in FY2026, compared with 78 days in FY2025 and 40 days in FY2024.

The trade-receivable balance increased from Rs 3.92 crore in FY2024 to Rs 17.39 crore in FY2025 and Rs 36.54 crore in FY2026. Revenue from operations also rose from Rs 35.85 crore in FY2024 to Rs 81.49 crore in FY2025 and Rs 104.59 crore in FY2026, but receivables represented an increasing share of sales: 10.93%, 21.34% and 34.94%, respectively. Correspondingly, receivables turnover fell from 14.81 times in FY2024 to 7.65 times in FY2025 and 3.88 times in FY2026.

This change affects the cash-conversion cycle because revenue is recognised before customer cash is collected. TNA Solutions says inaccurate credit assessment or unsuitable customer terms could result in delayed collections, write-offs or bad debts. If FY2026 dues are not recovered on schedule, the company says it could face a liquidity crunch, require higher working-capital borrowings and incur higher finance costs.

How did TNA Solutions’ export shift affect receivables?

TNA Solutions’ export shift affected receivables because export customers became the principal source of outstanding trade receivables. Export sales increased from Rs 99.90 lakh, or 2.79% of revenue, in FY2024 to Rs 27.21 crore, or 33.39%, in FY2025 and Rs 54.41 crore, or 52.03%, in FY2026. Domestic sales declined to 47.97% of FY2026 revenue from 97.21% in FY2024.

TNA Solutions directly attributes the longer receivable cycle to that shift. Export receivables comprised 56.91% of total trade receivables in FY2025 and 81.40% in FY2026. TNA Solutions says export customers receive commercially agreed credit periods, so a larger export business increased both receivables outstanding and the time before collection.

The FY2026 export model also introduces collection and delivery factors beyond domestic customer credit decisions. TNA Solutions sells to customers in countries including the United States, United Arab Emirates, South Africa, Israel, Singapore, Hong Kong, the United Kingdom, Malaysia, Italy and Mauritius. The company identifies tariffs, foreign-exchange movements, trade restrictions, geopolitical conditions, freight availability, port congestion and container shortages as factors that can affect export sales, shipments, receivables and cash flows.

What does the rise in receivables mean for operating cash flow?

TNA Solutions says rising receivables were one stated reason for negative operating cash flow in each of FY2024, FY2025 and FY2026. Operating cash flow records cash generated or used in normal business activities rather than accounting revenue or profit. TNA Solutions attributes the three years of negative operating cash flow primarily to increases in trade receivables, other current assets and inventories.

The cash-flow table in the prospectus lists negative operating cash flow of Rs 18.47 crore, Rs 17.26 crore and Rs 8.57 crore for its three annual columns, although two columns are labelled March 31, 2024. The accompanying explanation attributes the working-capital investment to higher inventories and trade receivables as operations scaled up, partly offset by higher trade payables and other current liabilities. Trade payables are amounts owed by TNA Solutions to suppliers.

TNA Solutions also says it extended credit terms to selected customers to support sales volumes and customer relationships, while building inventory to fulfil a growing order book. That mechanism requires funding between input procurement, manufacturing and customer payment. The continuation of negative operating cash flow therefore depends partly on collection timing, inventory requirements, customer credit terms and the availability of working-capital funding.

How concentrated is TNA Solutions’ customer and business model?

TNA Solutions’ working-capital exposure is linked to a highly business-to-business, or B2B, sales model and a concentrated customer base. B2B manufacturing generated 99.60% of FY2026 revenue, or Rs 104.17 crore, while business-to-consumer, or B2C, sales contributed 0.40%, or Rs 42.23 lakh. TNA Solutions launched its Ambra Linens consumer brand in 2022 but describes its B2C operation as being at a relatively early stage.

The top 10 customers generated Rs 87.67 crore, or 83.82%, of FY2026 revenue. That share was lower than 87.42% in FY2025 and 95.84% in FY2024, but the largest FY2026 customer alone represented 23.27% of revenue, or Rs 24.33 crore. TNA Solutions has no long-term agreements with customers and operates on purchase orders, which customers may terminate with or without cause or notice.

Customer concentration does not establish a collection failure, and TNA Solutions says it had not faced a significant customer loss or a material customer complaint in FY2024 through FY2026. However, reduced orders, disputes, customer financial difficulty or changes in quality specifications at major customers could affect both revenue and collections. TNA Solutions identifies such developments as possible risks to cash flows.

Can TNA Solutions reduce debtor days while exports stay significant?

TNA Solutions estimates debtor days of 120 for FY2027 and projects the same level for FY2028, rather than a return to the 40-day level reported in FY2024. The projection assumes export sales remain significant and incorporates what TNA Solutions calls a reasonable improvement from FY2026's 128 days through regular collection follow-up. This is a management estimate rather than a reported outcome.

On that assumption, TNA Solutions estimates trade receivables of Rs 39.20 crore in FY2027 and projects Rs 54.19 crore in FY2028. The plan requires collection discipline to improve enough to offset part of the longer credit cycle associated with export sales. It also requires customers to pay according to agreed terms and export operations to avoid disruptions that could delay shipment, acceptance or payment.

TNA Solutions’ supplier arrangements add another working-capital consideration. Its top 10 suppliers accounted for 76.41% of FY2026 purchases, or Rs 58.63 crore, and TNA Solutions says it has no long-term contracts with suppliers. The company states that it had not experienced significant raw-material supply disruptions during the preceding three financial years, but a future disruption could affect production and deliveries.

Conclusion

TNA Solutions’ 128 debtor days in FY2026 resulted from a measurable change in its sales and receivable mix: exports rose to 52.03% of revenue, export customers represented 81.40% of trade receivables, and receivables expanded to 34.94% of revenue. The longer cycle coincided with three consecutive years of negative operating cash flow that TNA Solutions attributes primarily to increased receivables, inventories and other current assets.

The next disclosed benchmark is TNA Solutions’ 120-day receivable assumption for FY2027 and FY2028, supported by planned regular collection follow-up. What follows will depend on whether export sales remain significant, whether FY2027 receivables remain near the estimated Rs 39.20 crore, and whether collection improvements occur without additional pressure on working-capital funding or customer credit terms.