Raj Rayon Industries Limited puts Rs 73.9951 crore into mutual funds

Raj Rayon Industries Limited invested Rs 73.9951 crore in mutual funds during the half year ended September 30, 2026, while cash and cash equivalents fell to Rs 1.5578 crore from Rs 12.4226 crore at March 31, 2026. The cash-flow statement reported Rs 92.2417 crore on its operating-activities line, alongside Rs 81.9824 crore of investing outflows.

Why did Raj Rayon’s cash and cash equivalents decline?

Raj Rayon’s cash and cash equivalents declined by Rs 10.8648 crore during the half year ended September 30, 2026 because investing and financing outflows exceeded the amount reported from operating activities. The closing balance was Rs 1.5578 crore, compared with Rs 12.4226 crore at March 31, 2026 and Rs 22.9862 crore at September 30, 2025.

The company recorded Rs 73.9951 crore of investments in mutual funds, abbreviated as MF in its cash-flow statement. It also spent Rs 8.035 crore on property, plant and equipment and capital work in progress, producing a total investing cash outflow of Rs 81.9824 crore. The filing does not identify the mutual-fund schemes, their maturities, or their redemption conditions.

How much cash did Raj Rayon report from operating activities?

Raj Rayon reported Rs 92.2417 crore on the line labelled “net cash flow used in operating activities” for the half year ended September 30, 2026, compared with Rs 82.5644 crore in the corresponding 2025 period. The positive amount followed Rs 49.3857 crore of operating profit before working-capital changes, up from Rs 33.6089 crore a year earlier.

Working-capital movements included a Rs 64.74 crore increase in trade payables, compared with a Rs 98.3064 crore increase in the prior-year half. That was partly offset by a Rs 18.2063 crore increase in trade receivables and a Rs 12.1205 crore increase in financial and other assets. Inventory released Rs 4.6877 crore in the 2026 half, whereas it consumed Rs 21.5854 crore in the 2025 half.

The reconciliation included Rs 10.1575 crore of depreciation, Rs 7.9927 crore of finance costs and a Rs 0.8949 crore net unrealised gain on investments. Raj Rayon also paid Rs 0.615 crore in direct taxes, against Rs 0.5107 crore a year earlier. Profit before tax was Rs 32.2282 crore for the period, compared with Rs 17.3618 crore in the prior-year half.

How did Raj Rayon allocate its investing and financing cash?

Raj Rayon used Rs 81.9824 crore in investing activities and Rs 21.1241 crore in financing activities during the half year ended September 30, 2026. Mutual-fund investments of Rs 73.9951 crore were the largest investing item, while purchases of property, plant and equipment and capital work in progress were Rs 8.035 crore. The comparable 2025 cash-flow statement contained no mutual-fund investment line.

Financing cash flows included repayment of Rs 11.7624 crore of long-term borrowings, repayment of Rs 0.4738 crore of short-term borrowings, and Rs 8.8879 crore of interest and other borrowing costs. In the 2025 half, Raj Rayon recorded Rs 8.1742 crore of proceeds from long-term borrowings, while short-term borrowings declined by Rs 39.0968 crore.

Current investments stood at Rs 100.2083 crore on September 30, 2026, up from Rs 25.3184 crore at March 31, 2026. The Rs 74.8899 crore increase broadly corresponds with the Rs 73.9951 crore mutual-fund investment outflow and Rs 0.8949 crore unrealised investment gain recorded in the cash-flow reconciliation. Raj Rayon does not provide a security-level reconciliation of current investments.

What changed in Raj Rayon’s balance sheet and earnings?

Raj Rayon held Rs 1.5578 crore of cash and cash equivalents and Rs 10.5892 crore of bank balances other than cash and cash equivalents at September 30, 2026. The separate bank-balance line rose from Rs 10.2725 crore at March 31, while cash and cash equivalents fell from Rs 12.4226 crore. These are separately presented financial-asset categories in the balance sheet.

Current assets increased to Rs 340.5169 crore from Rs 250.7202 crore over the six months. Trade receivables rose to Rs 48.3845 crore from Rs 30.1964 crore, while inventories declined to Rs 113.412 crore from Rs 118.0998 crore. Other current assets increased to Rs 64.6203 crore from Rs 53.2807 crore.

Non-current borrowings declined to Rs 137.4883 crore from Rs 150.7837 crore, while current borrowings were Rs 71.8731 crore compared with Rs 71.709 crore. Trade payables due to creditors other than micro and small enterprises increased to Rs 262.6981 crore from Rs 204.6102 crore. Those balance-sheet movements accompany the Rs 64.74 crore trade-payables increase in the cash-flow statement.

Raj Rayon reported revenue from operations of Rs 660.9331 crore for the half year ended September 30, 2026, compared with Rs 579.5097 crore in the prior-year half. Profit after tax rose to Rs 29.8483 crore from Rs 14.0924 crore, and basic earnings per share increased to Rs 0.54 from Rs 0.25. Raj Rayon operates in one segment, manufacturing and marketing textile yarns.

Conclusion

Raj Rayon directed a substantial portion of its reported Rs 92.2417 crore operating-activities amount toward Rs 73.9951 crore of mutual-fund investments in the half year ended September 30, 2026. Combined with Rs 8.035 crore of capital expenditure and Rs 21.1241 crore of financing outflows, that allocation left cash and cash equivalents at Rs 1.5578 crore.

The next disclosed unresolved matter is Raj Rayon’s assessment of new labour codes. Management said implementation had been deferred while it finalises the process with the human-resources department, after reporting Rs 8.5779 crore of employee-benefit expense for the half year ended September 30, 2026.