Modi Naturals cash from operations falls to Rs 8.68 crore

Modi Naturals Limited reported net cash from operating activities of Rs 8.68 crore for the half year ended 30 September 2026, down from Rs 35.96 crore a year earlier, as a Rs 40.60 crore working-capital outflow in trade and other receivables outweighed a rise in profit before tax to Rs 29.26 crore.

Why did Modi Naturals’ operating cash flow fall?

Modi Naturals’ operating cash flow fell because the increase in receivables absorbed most of the cash generated before working-capital changes in the half year ended 30 September 2026. Operating profit before working-capital changes was Rs 41.01 crore, compared with Rs 33.14 crore in the corresponding half of 2025. Yet net cash from operating activities was Rs 8.68 crore, a decline of Rs 27.28 crore from Rs 35.96 crore.

The cash-flow statement shows trade and other receivables rising by Rs 40.60 crore in the 2026 half year, compared with a Rs 1.75 crore rise in the previous-year period. That additional receivables movement was larger than the Rs 7.87 crore increase in operating profit before working-capital changes, creating the principal gap between higher reported earnings and lower operating cash.

Direct taxes paid, net of refunds, were Rs 6.58 crore in the 2026 half year, against Rs 4.81 crore a year earlier. Before taxes, cash generated from operations was Rs 15.26 crore, compared with Rs 40.78 crore in the prior-year half, indicating that the lower operating cash result was already evident before the tax payment.

How much did Modi Naturals’ receivables increase?

Modi Naturals’ trade receivables increased to Rs 82.39 crore at 30 September 2026 from Rs 47.00 crore at 31 March 2026, a rise of Rs 35.39 crore. The balance-sheet movement differs from the Rs 40.60 crore cash-flow line for trade and other receivables because the cash-flow statement includes receivables beyond the trade-receivables balance-sheet caption.

The receivables build-up occurred while revenue from operations increased to Rs 361.95 crore in the half year ended 30 September 2026 from Rs 303.41 crore in the corresponding 2025 period. The filing does not provide customer-level ageing, collection terms, provisions or a management explanation for the increase, so it does not establish how much of the movement related to sales growth, collection timing or other receivable categories.

Other current assets also rose to Rs 30.85 crore at 30 September 2026 from Rs 26.65 crore at 31 March 2026. Total current assets consequently increased to Rs 212.42 crore from Rs 171.97 crore, while inventories were nearly unchanged at Rs 88.94 crore compared with Rs 89.02 crore.

Did Modi Naturals’ profit rise despite the cash-flow decline?

Modi Naturals’ profit rose despite the operating cash-flow decline, with profit for the half year increasing to Rs 23.53 crore from Rs 20.57 crore a year earlier. Profit before tax increased to Rs 29.26 crore from Rs 25.31 crore, while total income rose to Rs 361.97 crore from Rs 304.97 crore.

Revenue growth came principally from the ethanol segment, whose half-year revenue rose to Rs 193.70 crore from Rs 165.47 crore. Bulk segment revenue increased to Rs 80.81 crore from Rs 47.22 crore, while branded segment revenue decreased to Rs 87.44 crore from Rs 90.72 crore. These three segments together reported Rs 361.95 crore of revenue from operations.

Ethanol segment earnings before interest, tax, depreciation and amortisation, or EBITDA, increased to Rs 35.15 crore from Rs 25.82 crore. Branded segment EBITDA was Rs 9.34 crore compared with Rs 7.20 crore, while bulk segment EBITDA declined to Rs 0.74 crore from Rs 1.13 crore. Total segment EBITDA rose to Rs 40.82 crore from Rs 34.15 crore.

What other working-capital changes affected cash generation?

Modi Naturals received a Rs 14.77 crore cash contribution from trade payables in the 2026 half year, compared with Rs 0.89 crore in the previous-year period. This inflow partly offset the Rs 40.60 crore receivables outflow, but it was insufficient to preserve the prior year’s Rs 35.96 crore level of operating cash flow.

Inventories provided Rs 0.09 crore of cash in the 2026 half year, versus Rs 8.49 crore in the prior-year half. The smaller inventory benefit is consistent with the balance-sheet inventory balance remaining broadly stable, at Rs 88.94 crore at 30 September 2026 and Rs 89.02 crore at 31 March 2026.

Current liabilities increased to Rs 129.84 crore at 30 September 2026 from Rs 104.12 crore at 31 March 2026. Trade payables were Rs 54.66 crore at the September date versus Rs 40.86 crore at year-end, while other financial liabilities declined to Rs 18.75 crore from Rs 20.71 crore.

How did investing and financing cash flows change?

Modi Naturals recorded net cash used in investing activities of Rs 7.52 crore for the half year ended 30 September 2026, compared with Rs 34.85 crore used a year earlier. Net changes in property, plant and equipment were Rs 8.82 crore in the 2026 period, against Rs 38.25 crore in the prior-year period, while proceeds from disposal of property, plant and equipment were Rs 1.18 crore.

Financing activities used Rs 0.74 crore in the 2026 half year, compared with Rs 0.94 crore in the prior-year period. Net borrowings contributed Rs 5.01 crore, but interest paid was Rs 5.74 crore; finance costs recognised in the income statement were also Rs 5.74 crore, compared with Rs 4.83 crore a year earlier.

Cash and cash equivalents were Rs 2.25 crore at 30 September 2026, up from Rs 1.83 crore at 31 March 2026. The filing labels the main statement as a consolidated cash-flow statement, although its note describes the cash-flow statement as standalone and says it was prepared using the indirect method under Indian Accounting Standard 7; the filing does not explain that labelling difference.

Conclusion

Modi Naturals delivered higher first-half revenue, profit before tax and net profit in the period ended 30 September 2026, but those gains did not translate into comparable operating cash. A Rs 40.60 crore rise in trade and other receivables was the dominant cash use, reducing net operating cash to Rs 8.68 crore even after a Rs 14.77 crore contribution from trade payables.

The filing provides no receivables-reduction target, collection schedule or management explanation for the increase. The unresolved matter to watch is whether trade receivables, which stood at Rs 82.39 crore at 30 September 2026, decline in later reported periods and permit operating cash flow to move closer to reported profit.