Maheshwari Logistics turns H1 operating cash flow positive

Maheshwari Logistics Limited returned to positive operating cash flow of Rs 609.01 lakh for the half year ended September 30, 2026, against an outflow of Rs 25.03 crore a year earlier, as a Rs 12.34 crore reduction in inventories helped offset continuing cash absorption from receivables and other current assets.

Why did Maheshwari Logistics’ operating cash flow turn positive?

Maheshwari Logistics turned operating cash flow positive because lower inventory released Rs 12.34 crore during the half year ended September 30, 2026, compared with an Rs 8.84 crore inventory-related cash outflow in the corresponding prior-year period. Net cash from operating activities was Rs 609.01 lakh, reversing the Rs 25.03 crore outflow reported for the half year ended September 30, 2025.

The turnaround occurred despite lower operating profit before working-capital changes. That measure was Rs 31.91 crore in H1 FY2027, down from Rs 33.25 crore in H1 FY2026. The cash-flow statement therefore indicates that working-capital movements, particularly inventories, rather than higher pre-working-capital operating profit, drove the change in reported operating cash generation.

Maheshwari Logistics reported the figures in its unaudited standalone cash-flow statement, which its board approved on November 5, 2026. The statement begins with profit before extraordinary items and tax of Rs 10.09 crore for H1 FY2027, compared with Rs 12.16 crore a year earlier, before adjustments including depreciation, finance costs and interest income.

How did working-capital movements affect Maheshwari Logistics’ cash flow?

Maheshwari Logistics’ inventory reduction was the principal disclosed working-capital release, but receivables and other current assets still used cash. Trade receivables consumed Rs 12.36 crore in H1 FY2027, while other current assets consumed Rs 14.42 crore. In H1 FY2026, those two lines consumed Rs 24.47 crore and Rs 23.78 crore respectively.

The cash use from receivables and other current assets declined year on year, although both remained outflows. Their combined cash absorption was Rs 26.78 crore in H1 FY2027, against Rs 48.25 crore in the prior-year half. The reduction, alongside the inventory release, was consistent with the shift to positive reported operating cash flow.

Other operating-asset movements also drew on cash. Current financial assets used Rs 4.14 crore, non-current financial assets used Rs 1.04 crore, and short-term loans and advances used Rs 21.86 lakh in H1 FY2027. Other non-current assets released Rs 63.99 lakh, while net income tax paid or refunded was an outflow of Rs 2.52 crore, lower than Rs 3.86 crore a year earlier.

The September 30, 2026 balance sheet records inventories of Rs 155.36 crore, down from Rs 167.70 crore at March 31, 2026. That Rs 12.34 crore balance-sheet decrease matches the inventory cash-flow movement for the half year. The filing does not provide a segment-level split of the inventory release between trading, transportation and port service, or kraft-paper manufacturing.

What happened to Maheshwari Logistics’ cash after operations?

Maheshwari Logistics’ positive operating cash flow did not translate into a rise in cash balances because investing and financing activities were net outflows. The company reported Rs 5.94 crore of net cash used in investing activities and Rs 4.72 crore used in financing activities during H1 FY2027, producing a Rs 4.57 crore decline in cash and cash equivalents.

Capital expenditure on fixed assets, including capital advances, was Rs 3.00 crore in the half year, substantially below Rs 21.56 crore in H1 FY2026. The investing cash-flow statement also records a Rs 4.93 crore right-of-use asset movement, Rs 49.54 lakh of proceeds from sales of tangible assets, Rs 32.82 lakh of rent received and Rs 1.41 crore of interest received.

Finance costs paid were Rs 15.20 crore, compared with Rs 16.40 crore in the prior-year half. The financing section also records a Rs 3.23 crore movement in lease liability. Overall financing cash flow changed from an inflow of Rs 12.92 crore in H1 FY2026 to an outflow of Rs 4.72 crore in H1 FY2027, adding to the fall in closing cash.

Cash and cash equivalents fell to Rs 2.60 crore at September 30, 2026 from Rs 7.17 crore at the start of the financial year. The comparable prior-year period ended with Rs 10.59 crore, after a Rs 11.90 crore fall during that half. At September 30, 2026, Maheshwari Logistics reported Rs 2.33 crore of cash on hand and Rs 27.06 lakh held in current bank accounts.

How does Maheshwari Logistics’ cash flow compare with its balance sheet?

Maheshwari Logistics increased total assets to Rs 637.71 crore at September 30, 2026 from Rs 622.31 crore at March 31, 2026, while total equity rose to Rs 223.54 crore from Rs 214.82 crore. The inventory reduction occurred within a balance sheet that still carried sizeable current assets and current liabilities, making subsequent movements in receivables and other current assets relevant to operating cash flow.

Current borrowings were Rs 221.42 crore at September 30, 2026, compared with Rs 219.36 crore at March 31, 2026. Trade payables to creditors other than micro and small enterprises were Rs 101.79 crore, down from Rs 112.36 crore. These are closing balance-sheet positions, whereas the cash-flow statement measures changes during the six-month period.

The filing reported total current liabilities of Rs 353.67 crore at September 30, 2026, compared with Rs 356.04 crore six months earlier. Non-current liabilities increased to Rs 60.50 crore from Rs 51.45 crore, while total assets rose by Rs 15.39 crore. The standalone statements therefore show positive operating cash generation alongside a lower closing cash balance and continued use of cash in investing and financing activities.

Conclusion

Maheshwari Logistics’ H1 FY2027 cash-flow reversal was primarily a working-capital development. A Rs 12.34 crore inventory release and smaller cash absorption from receivables and other current assets helped produce a Rs 609.01 lakh operating cash inflow, despite operating profit before working-capital changes falling by Rs 1.34 crore from the prior-year period.

The next point to watch is whether positive operating cash flow continues without a further material inventory release. The filing gives no operating-cash-flow target or capital-expenditure plan, while receivables used Rs 12.36 crore and other current assets used Rs 14.42 crore in H1 FY2027; their movement in the next reported financial results remains unresolved.