Kanchi Karpooram reports Rs 7.0214 crore operating outflow

Kanchi Karpooram Limited reported a Rs 7.0214 crore consolidated operating cash outflow for the half year ended September 30, 2026, as working-capital changes offset Rs 7.3257 crore of profit before tax; short-term bank loans increased Rs 15.9618 crore and generated most of the Rs 15.0374 crore financing inflow.

Why did Kanchi Karpooram’s operating cash flow turn negative?

Kanchi Karpooram’s operating cash flow turned negative because working-capital movements exceeded cash generated before those movements. Operating cash flow before working-capital changes was Rs 7.7072 crore in the half year ended September 30, 2026, but it became an outflow of Rs 6.5801 crore after those changes. Net taxes paid of Rs 44.13 lakh then took net operating cash used to Rs 7.0214 crore.

The largest movement was a Rs 18.1044 crore increase in other assets, partly offset by a Rs 4.5213 crore decrease in trade receivables. Inventory increased by Rs 3.78 lakh, trade payables declined by Rs 71.82 lakh and other current liabilities and provisions fell by Rs 19.02 lakh. Other financial liabilities rose by Rs 14.35 lakh, while loans and advances fell by Rs 7.63 lakh.

How did Kanchi Karpooram’s bank borrowing affect cash flows?

Kanchi Karpooram increased short-term loans from banks by Rs 15.9618 crore during the half year ended September 30, 2026. The consolidated balance sheet reported current borrowings of Rs 15.9618 crore at September 30, 2026, while the March 31, 2026 balance-sheet column did not report an amount for current borrowings. The cash-flow statement identifies the movement specifically as an increase in short-term loans from bank.

Financing activities produced a net cash inflow of Rs 15.0374 crore after the borrowing increase. This included Rs 43.43 lakh of dividends paid, Rs 39.77 lakh of finance cost and Rs 9.24 lakh of lease-liability repayments. In the half year ended September 30, 2025, short-term bank loans increased Rs 13.3167 crore and net financing inflow was Rs 12.0508 crore, lower than in the current period.

What other uses of cash were reported in the half year?

Kanchi Karpooram used Rs 8.1833 crore in investing activities in the half year ended September 30, 2026. Changes in other bank balances used Rs 5 crore, investment in corporate bonds used Rs 2.0246 crore and loans given or repaid used Rs 1.60 crore. Purchases of property, plant and equipment, intangible assets, capital work in progress and capital advances used another Rs 31.90 lakh, while interest income added Rs 76.03 lakh.

The investing outflow increased from Rs 6.5341 crore in the September 2025 half year. The comparison includes a Rs 5 crore outflow from changes in other bank balances in 2026, against a Rs 7.5655 crore inflow from that line a year earlier. At September 30, 2026, bank balances other than cash equivalents were Rs 19.09 crore, investments were Rs 11.9567 crore and cash and cash equivalents were Rs 75.15 lakh.

Did Kanchi Karpooram remain profitable despite negative operating cash flow?

Kanchi Karpooram remained profitable on a consolidated accounting basis, reporting profit after tax of Rs 5.5885 crore for the half year ended September 30, 2026, compared with Rs 4.0649 crore a year earlier. Revenue from operations declined to Rs 72.7378 crore from Rs 74.6447 crore, while profit before tax increased to Rs 7.3257 crore from Rs 5.4978 crore. The cash-flow statement attributes the disconnect between reported profit and operating cash to the working-capital movements recorded during the period.

The Camphor segment generated Rs 69.5093 crore of half-year revenue and Rs 7.177 crore of segment result before finance cost and inter-segment adjustments. Trading of Agro Products generated Rs 3.3188 crore of revenue and Rs 76.62 lakh of segment result, compared with no reported revenue and a Rs 4,000 segment loss in the comparable prior-year half year. Finance cost fell to Rs 42.04 lakh from Rs 75.09 lakh, although the filing does not provide interest rates, maturity dates, security or repayment schedules for the short-term bank loans.

Conclusion

Kanchi Karpooram’s September 2026 half-year results show a contrast between accounting profit and cash generation. Profit after tax rose by Rs 1.5236 crore year on year, but a Rs 18.1044 crore rise in other assets and other working-capital movements resulted in a Rs 7.0214 crore operating cash outflow. The Rs 15.9618 crore increase in short-term bank loans was the main source of financing cash during the period.

The next point to watch is whether Kanchi Karpooram discloses the purpose, pricing, maturity or security of the Rs 15.9618 crore short-term bank borrowing, none of which appears in this filing. Changes in other assets of Rs 19.9757 crore, other bank balances of Rs 19.09 crore and operating cash flow will also indicate whether the September 30, 2026 funding pattern persists.