Prizor cash flow turns negative as working-capital days hit 171

Prizor Viztech Ltd. used Rs 4.567 crore in net operating cash in H1 FY27, as Rs 30.269 crore absorbed by working-capital changes exceeded Rs 25.763 crore of operating profit before those changes. The company reported 171 working-capital days in H1 FY27, compared with 90 days in FY26, despite 159.4% growth in profit after tax.

Why did Prizor report negative operating cash flow?

Prizor reported negative operating cash flow because the Rs 30.269 crore working-capital outflow was larger than its Rs 25.763 crore operating profit before working-capital changes in the cash-flow statement for Sept-26. Cash used from operations was Rs 4.507 crore, and Rs 6 lakh of direct taxes paid took net cash used in operating activities to Rs 4.567 crore.

The column labelled Mar-26 showed a positive outcome before the Sept-26 reversal. Operating profit before working-capital changes was Rs 33.426 crore, while changes in working capital absorbed Rs 29.636 crore, leaving Rs 3.790 crore of cash generated from operations. After the direct-tax line of negative Rs 3.50 crore, net cash from operating activities was Rs 29 lakh.

The cash-flow result contrasts with Prizor's H1 FY27 reported earnings. Revenue from operations rose 153.5% year on year to Rs 106.501 crore, earnings before interest, tax, depreciation and amortisation, or EBITDA, rose 162.4% to Rs 25.085 crore, and profit after tax, or PAT, rose 159.4% to Rs 15.339 crore. The presentation identifies changes in working capital, rather than lower reported profit, as the reason operating cash was negative.

How did Prizor's working-capital position change?

Prizor's working-capital days rose by 81 days to 171 in H1 FY27 from 90 in FY26. The H1 FY27 figure also exceeded the annual levels of 117 days in FY24 and 149 days in FY25, making it the highest working-capital-days measure across the four periods presented.

Inventory, trade receivables and short-term loans and advances all increased between Mar-26 and Sept-26. Inventories rose Rs 8.697 crore to Rs 58.682 crore, trade receivables rose Rs 12.371 crore to Rs 51.001 crore, and short-term loans and advances rose Rs 7.515 crore to Rs 8.676 crore. These balance-sheet movements coincided with the Rs 30.269 crore cash absorption reported under working-capital changes.

Total current assets increased Rs 27.274 crore to Rs 118.904 crore, whereas total current liabilities increased Rs 12.612 crore to Rs 68.892 crore. Cash and cash equivalents declined to Rs 17.3 lakh in Sept-26 from Rs 1.11 crore in Mar-26. Other current assets fell to Rs 37.4 lakh from Rs 74.4 lakh, a reduction smaller than the increases in inventory, receivables and advances.

Did Prizor convert higher profit into operating cash?

Prizor did not convert its H1 FY27 operating profit into positive operating cash because its Rs 25.763 crore operating profit before working-capital changes was followed by a Rs 30.269 crore working-capital outflow. The resulting Rs 4.567 crore net operating cash outflow occurred alongside PAT of Rs 15.339 crore, compared with Rs 5.914 crore in H1 FY26.

Profit before tax rose to Rs 20.631 crore in H1 FY27 from Rs 7.941 crore in H1 FY26. Depreciation increased to Rs 1.940 crore from Rs 28.9 lakh, while finance cost rose to Rs 2.543 crore from Rs 1.346 crore. The cash-flow statement adds adjustments for non-operating items of Rs 5.131 crore to profit before tax in arriving at operating profit before working-capital changes.

The margin trend was different from the cash-conversion result. EBITDA margin increased by 80 basis points to 23.6% in H1 FY27 from 22.8% in H1 FY26, while PAT margin increased by 30 basis points to 14.4% from 14.1%. Earnings before interest and tax margin declined by 30 basis points to 21.8% from 22.1%.

Prizor generated 96% of category-wise H1 FY27 revenue from closed-circuit television, or CCTV, cameras, with display products accounting for the remaining 4%. Management said it added 22 Bureau of Indian Standards Electronic Regulatory certified camera models, bringing the total to 34 models. That product concentration provides the category context for the period's higher inventory and receivables balances, although the presentation does not separately allocate those balances by product.

How did financing and investment flows affect Prizor's cash?

Prizor reported Rs 14.027 crore of cash flow from financing activities and Rs 10.397 crore used in investing activities in the Sept-26 cash-flow statement. Alongside the Rs 4.567 crore operating cash outflow, these flows resulted in a Rs 93.7 lakh net decrease in cash and cash equivalents, compared with a Rs 97.8 lakh increase in the column labelled Mar-26.

Borrowings increased between Mar-26 and Sept-26. Long-term borrowings rose Rs 7.604 crore to Rs 17.492 crore, while short-term borrowings rose Rs 8.965 crore to Rs 40.789 crore. Total equity increased Rs 15.338 crore to Rs 89.580 crore, including reserves and surplus of Rs 71.109 crore, up from Rs 55.770 crore.

The presentation states that return on capital employed, or ROCE, and return on equity, or ROE, were affected by a preferential allotment of Rs 119.45 crore approved on 27 August 2026, involving 13.63 lakh additional shares. ROCE was 21.5% in H1 FY27 versus 37.2% in FY26, and ROE was 17.1% versus 35.5%. Prizor attributes the change in these ratios to a higher equity base and capital employed after the fundraise.

Management also said it commissioned an assembly line that increased annual capacity by 50% to 24 lakh units. It opened zonal offices in Kolkata and Noida and engaged with more than 450 channel partners through dealer programmes. These disclosed operating developments occurred during the same H1 FY27 period in which current assets rose to Rs 118.904 crore and operating cash turned negative.

Conclusion

Prizor's H1 FY27 presentation shows a gap between reported earnings growth and operating cash conversion. Revenue reached Rs 106.501 crore and PAT reached Rs 15.339 crore, but the Rs 30.269 crore working-capital outflow led to Rs 4.567 crore of net cash used in operating activities. Working-capital days increased to 171 as inventories, receivables and short-term advances rose.

The next items to watch are management's disclosed plans for further product certifications, deeper market penetration, stronger distribution partnerships and disciplined execution. Prizor had 34 certified camera models, more than 450 channel partners and 24 lakh units of annual capacity after the new assembly line. The presentation does not state a target for working-capital days or operating cash flow, leaving future cash conversion unresolved.