L W S Knitwear Limited reports Rs 1.62 crore H1 outflow

L W S Knitwear Limited reported a Rs 1.62 crore net operating cash outflow for the half year ended September 30, 2026, although it recorded Rs 48.04 lakh in profit after tax. Inventory, receivables and other current assets absorbed cash, and cash and cash equivalents fell from Rs 2.69 crore at March 31, 2026 to Rs 15.88 lakh.

Why did L W S Knitwear report an operating cash outflow?

L W S Knitwear reported an operating cash outflow because working-capital movements exceeded its Rs 1.51 crore operating profit before working-capital changes for the half year ended September 30, 2026. The cash-flow statement starts with Rs 63.85 lakh of profit before tax from continuing operations and adds back Rs 86.94 lakh of interest cost, Rs 44,000 of depreciation and amortisation, and Rs 1,000 of prior-year adjustments.

Working-capital changes reduced cash sufficiently to turn the pre-working-capital profit into a deficit. Cash generated from operations was negative Rs 1.46 crore, and a Rs 15.80 lakh provision for tax took cash flow before extraordinary items to negative Rs 1.62 crore. L W S Knitwear reported the same negative Rs 1.62 crore as net cash used in operating activities.

The reported cash result contrasts with the Rs 95.86 lakh operating cash inflow for the year ended March 31, 2026. The filing labels the current cash-flow period as the year ended September 30, 2026, but the accompanying results and balance sheet identify it as the six months ended September 30, 2026; the comparison is therefore between a half-year period and a full year.

The cash-flow statement records no investing cash flow for the September 2026 period. It attributes the operating deficit across inventory, trade receivables, non-current assets, loans and advances, other current assets, trade payables, other financial liabilities, other current liabilities and current-tax liabilities, rather than identifying a single exceptional operating cash item.

Which balance-sheet accounts absorbed L W S Knitwear's cash?

L W S Knitwear's largest disclosed working-capital cash use was the Rs 3.86 crore increase in inventories. The balance sheet reports inventories of Rs 23.26 crore at September 30, 2026, compared with Rs 19.40 crore at March 31, 2026, consistent with the cash-flow statement's inventory movement.

Trade receivables used Rs 76.93 lakh of cash and rose to Rs 22.92 crore from Rs 22.15 crore over the same dates. Other current assets used a further Rs 2.68 crore, with the balance-sheet amount rising to Rs 13.80 crore from Rs 11.13 crore. Together, these three uses exceeded the Rs 1.51 crore operating profit before working-capital changes.

Some liability movements partly offset the cash absorption. Trade payables supplied Rs 3.23 crore of cash and increased to Rs 6.98 crore at September 30 from Rs 3.76 crore at March 31. Other current liabilities added Rs 1.52 crore of cash and rose to Rs 2.25 crore from Rs 72.61 lakh.

Loans and advances released Rs 44.88 lakh, while non-current assets used Rs 21.38 lakh and current-tax liabilities used Rs 60.13 lakh. L W S Knitwear identifies only one primary reportable segment in the filing, so there is no segment-level disclosure explaining which activity or product category drove the inventory, receivable or other-current-asset movements.

How did L W S Knitwear's cash and borrowings change?

L W S Knitwear ended September 30, 2026 with Rs 15.88 lakh of cash and cash equivalents, compared with Rs 2.69 crore at the beginning of the period. The cash-flow statement reports a negative Rs 2.54 crore net change in cash, consisting of the Rs 1.62 crore operating outflow, no investing cash flow, and negative Rs 91.40 lakh of financing cash flow.

The closing cash-flow balance comprised Rs 15.88 lakh of cash in hand, with no current-account balance or cheques under clearing reported at September 30. At March 31, 2026, the Rs 2.69 crore balance included Rs 2.33 crore of cheques under clearing, Rs 36.28 lakh of cash in hand and Rs 14,000 held in a current account.

The balance sheet separately records Rs 15.87 lakh of cash and cash equivalents at September 30, 2026, Rs 1,000 below the cash-flow statement's closing balance. The filing presents both figures, but does not explain the difference between the balance-sheet and cash-flow-statement amounts.

Current borrowings rose to Rs 8.74 crore at September 30 from Rs 7.97 crore at March 31, while non-current borrowings fell to Rs 9.07 crore from Rs 9.88 crore. Financing cash flows include a Rs 76.46 lakh increase in short-term borrowings, Rs 86.94 lakh of interest paid and a negative Rs 80.67 lakh line described in the filing as an increase in long-term borrowings excluding current maturity.

How did L W S Knitwear's H1 profit and revenue compare?

L W S Knitwear reported Rs 48.04 lakh in profit after tax for the six months ended September 30, 2026, compared with Rs 56.81 lakh in the corresponding six months of 2025. Revenue from operations was Rs 19.52 crore, down from Rs 45.96 crore a year earlier, while profit after tax declined by Rs 8.77 lakh.

Profit before tax was Rs 63.85 lakh for the September 2026 half year, versus Rs 73.59 lakh in the prior-year half year. Finance costs decreased to Rs 87.41 lakh from Rs 1.19 crore, but employee-benefit expense increased to Rs 24.38 lakh from Rs 16.20 lakh. Basic and diluted earnings per share were Rs 0.33, compared with Rs 0.39 a year earlier.

The quarter ended September 30, 2026 generated Rs 30.31 lakh of profit after tax, following Rs 17.73 lakh in the quarter ended June 30, 2026. The sequential rise in quarterly profit did not prevent the half-year operating cash deficit because the cash-flow statement captures cumulative balance-sheet movements from April 1 to September 30, 2026.

L W S Knitwear's board approved the unaudited results on November 13, 2026. The statutory auditor's limited review, also dated November 13, 2026, said nothing had come to its attention to indicate that the unaudited statement failed to disclose required information or contained a material misstatement.

Conclusion

L W S Knitwear's September 2026 half-year filing shows that its Rs 48.04 lakh accounting profit did not translate into operating cash generation. A Rs 3.86 crore inventory increase, Rs 76.93 lakh receivables increase and Rs 2.68 crore increase in other current assets contributed to a Rs 1.62 crore operating cash outflow, leaving Rs 15.88 lakh in cash and cash equivalents.

The next filing will show whether inventories of Rs 23.26 crore, trade receivables of Rs 22.92 crore and other current assets of Rs 13.80 crore convert into cash. It will also clarify whether the Rs 1,000 difference between the Rs 15.88 lakh cash-flow closing balance and the Rs 15.87 lakh balance-sheet figure persists; L W S Knitwear disclosed no working-capital target or cash-generation plan in this filing.