Mafatlal Industries Limited posts Rs 189.79 crore operating outflow

Mafatlal Industries reported a Rs 189.79 crore net operating cash outflow for the half year ended September 30, 2026, as a Rs 413.47 crore increase in trade and other receivables and a Rs 122.77 crore inventory increase outweighed Rs 296.28 crore higher trade and other payables.

Why did Mafatlal Industries report an operating cash outflow?

Mafatlal Industries reported an operating cash outflow because working-capital movements more than offset its Rs 24.99 crore operating profit before working-capital changes in the half year ended September 30, 2026. The group recorded Rs 34.10 crore of profit before tax, but receivables, inventories, payables and provisions together produced a Rs 240.54 crore cash outflow.

The largest use of cash was the Rs 413.47 crore increase in trade and other receivables, followed by a Rs 122.77 crore increase in inventories. An increase of Rs 296.28 crore in trade and other payables partly offset those movements, while provisions declined by Rs 58 lakh. After these changes, cash used in operations was Rs 215.55 crore; a Rs 25.76 crore net direct-tax refund reduced the final operating outflow to Rs 189.79 crore.

How did Mafatlal Industries’ working capital change?

Mafatlal Industries’ balance sheet shows that current trade receivables rose to Rs 1,117.21 crore at September 30, 2026 from Rs 710.22 crore at March 31, 2026, while inventories increased to Rs 228.38 crore from Rs 105.61 crore. The cash-flow statement’s Rs 413.47 crore receivables movement includes trade and other receivables, rather than only the current trade-receivables line.

Mafatlal Industries’ payables also increased, although less than the broader cash demand from receivables and inventory. Trade payables to creditors other than micro and small enterprises were Rs 1,055.41 crore at September 30, 2026, compared with Rs 703.00 crore at March 31, 2026. Current assets rose to Rs 1,457.49 crore from Rs 1,158.63 crore, while current liabilities increased to Rs 1,231.81 crore from Rs 928.81 crore.

How does the first-half cash flow compare with last year?

Mafatlal Industries’ operating cash flow reversed from a Rs 101.59 crore inflow in the half year ended September 30, 2025 to a Rs 189.79 crore outflow in the 2026 period. Operating profit before working-capital changes also declined to Rs 24.99 crore from Rs 85.11 crore, reflecting the fall in profit before tax to Rs 34.10 crore from Rs 70.18 crore.

The difference was principally in working capital. In the 2025 half year, working-capital changes generated Rs 15.65 crore of cash, as a Rs 675.19 crore increase in trade and other payables exceeded a Rs 667.92 crore increase in trade and other receivables and a Rs 7.72 crore inventory movement. In the 2026 half year, the Rs 240.54 crore working-capital outflow followed the higher receivables and inventory requirements.

What happened to Mafatlal Industries’ cash and borrowing position?

Mafatlal Industries ended September 30, 2026 with cash and cash equivalents of Rs 8.50 crore, down from Rs 123.94 crore at the beginning of the financial year. The resulting Rs 115.44 crore net decrease reflected the operating outflow, partly offset by Rs 65.69 crore of investing inflow and Rs 8.66 crore of financing inflow. At September 30, 2025, cash and cash equivalents were Rs 51.20 crore.

The investing inflow included Rs 59.47 crore from net maturity of term deposits with banks, together with Rs 4.06 crore of interest received and Rs 3.79 crore of dividends received. Financing cash flow included Rs 22.19 crore of net current borrowings, Rs 3.17 crore of non-current borrowings taken and Rs 9.02 crore of dividends paid. Current borrowings stood at Rs 51.03 crore at September 30, 2026, versus Rs 27.65 crore at March 31, 2026, while non-current borrowings were Rs 32.17 crore versus Rs 33.12 crore.

Which business segments changed during the half year?

Mafatlal Industries’ revenue from operations fell to Rs 1,737.25 crore in the half year ended September 30, 2026 from Rs 2,269.97 crore a year earlier. Consumer durables and others generated Rs 748.80 crore, down from Rs 1,445.68 crore, while textile and related products increased to Rs 876.15 crore from Rs 801.93 crore and digital infrastructure rose to Rs 112.30 crore from Rs 22.36 crore.

Segment results showed a similar mix shift. Textile and related products’ result declined to Rs 23.92 crore from Rs 55.05 crore, and consumer durables and others declined to Rs 11.24 crore from Rs 19.48 crore. Digital infrastructure increased its segment result to Rs 14.86 crore from Rs 3.45 crore. Total segment results nevertheless fell to Rs 50.02 crore from Rs 77.98 crore, before Rs 4.44 crore of finance costs and Rs 11.48 crore of net unallocable expenses.

Conclusion

Mafatlal Industries remained profitable in the half year ended September 30, 2026, reporting Rs 25.37 crore of profit after tax, but its cash conversion changed materially. A Rs 413.47 crore rise in trade and other receivables and a Rs 122.77 crore inventory increase turned operating cash flow into a Rs 189.79 crore outflow, reducing cash and cash equivalents to Rs 8.50 crore.

The next disclosed event is the interim dividend record date of November 13, 2026. The board declared an interim dividend of Rs 1 per equity share, amounting to Rs 7.22 crore, for financial year 2026-27 on November 4, 2026. Subsequent results will show whether collections, inventory levels and payables reverse enough to alter the working-capital cash movement.