Rama Phosphates posts Rs 19.15 crore operating cash outflow

Rama Phosphates Limited reported a Rs 19.15 crore net cash outflow from operating activities for the half year ended 30 September 2026, despite profit before tax rising to Rs 49.05 crore from Rs 44.36 crore a year earlier. A Rs 77.93 crore working-capital outflow, including higher subsidy and trade receivables, absorbed operating cash.

Why did Rama Phosphates report negative operating cash flow?

Rama Phosphates recorded negative operating cash flow because its working-capital movements exceeded cash generated before those movements. Operating profit before working-capital changes was Rs 60.20 crore in the half year ended 30 September 2026, but working capital consumed Rs 77.93 crore, leaving cash used in operations of Rs 17.73 crore before direct taxes.

Direct taxes paid were Rs 1.42 crore, taking net cash used in operating activities to Rs 19.15 crore, compared with net operating cash generated of Rs 32.50 crore in the half year ended 30 September 2025. The movement changed even as profit before tax increased by Rs 4.69 crore year on year, showing that reported profit did not translate into operating cash during the period.

Which working-capital items used Rama Phosphates cash?

Rama Phosphates’ government subsidies receivable increased by Rs 18.95 crore during the first half, making it the largest specified working-capital cash outflow. Trade receivables used another Rs 12.36 crore, other current assets used Rs 17.12 crore, and trade payables used Rs 28.86 crore, based on the indirect-method cash-flow statement.

Inventories used Rs 3.09 crore, while other current financial assets used Rs 84.01 lakh and other current liabilities used Rs 1.09 crore. These outflows were partly offset by Rs 4.30 crore generated from other current financial liabilities, Rs 47.27 lakh from other non-current financial assets and Rs 16.60 lakh from provisions. The filing therefore identifies several separate balance-sheet movements, rather than a single item, behind the cash deficit.

The balance sheet provides a period-end view of some of those changes. Government subsidies receivable rose to Rs 158.08 crore at 30 September 2026 from Rs 139.13 crore at 31 March 2026. Trade receivables stood at Rs 84.40 crore, up from Rs 77.49 crore, while other current assets increased to Rs 73.95 crore from Rs 60.40 crore.

How did higher profit compare with segment performance?

Rama Phosphates’ profit before tax rose to Rs 49.05 crore in the six months to 30 September 2026 from Rs 44.36 crore in the corresponding 2025 period. Revenue from operations increased to Rs 520.31 crore from Rs 435.97 crore, while total expenses rose to Rs 472.24 crore from Rs 392.11 crore. Net profit for the period reached Rs 36.23 crore, compared with Rs 33.41 crore.

The Fertilizers, Micro Nutrients & Chemicals segment produced Rs 515.50 crore of first-half revenue and Rs 61.26 crore of segment result before interest and tax. Its revenue was Rs 93.48 crore higher than Rs 422.01 crore a year earlier, and its segment result rose from Rs 55.19 crore. The filing states that the fertilizer segment includes non-subsidised fertilizers.

The Soya/Agri segment generated Rs 4.81 crore of first-half revenue, down from Rs 13.96 crore a year earlier. Its segment loss narrowed to Rs 55.94 lakh from Rs 85.83 lakh. Finance costs rose to Rs 7.98 crore from Rs 5.73 crore, while other unallocable expenses declined to Rs 3.67 crore from Rs 4.24 crore, resulting in the reported profit-before-tax increase.

How were Rama Phosphates’ cash needs financed?

Rama Phosphates generated Rs 43.15 crore from financing activities in the half year, compared with a Rs 29.36 crore financing cash outflow a year earlier. Net short-term borrowings increased by Rs 35.70 crore and net long-term borrowings increased by Rs 14.79 crore. These inflows were partly reduced by Rs 7.92 crore of interest paid, Rs 1.03 crore of lease-rental payments and Rs 22.12 lakh of dividends paid.

Rama Phosphates also used Rs 22.18 crore in investing activities, versus Rs 3.14 crore in the comparable prior period. Purchase of property, plant and equipment, including capital work in progress, accounted for Rs 22.32 crore. Capital subsidy on property, plant and equipment contributed Rs 1.75 crore, while margin-money deposits used Rs 2.54 crore and interest received was Rs 93.77 lakh.

At 30 September 2026, current borrowings were Rs 167.42 crore, compared with Rs 131.73 crore at 31 March 2026, and non-current borrowings were Rs 20.26 crore against Rs 5.48 crore. Cash and cash equivalents declined by Rs 1.50 lakh during the half year to Rs 13.95 lakh. Total assets increased to Rs 787.84 crore from Rs 719.22 crore, while total equity rose to Rs 458.31 crore from Rs 422.47 crore.

What operating expansion does Rama Phosphates disclose?

Rama Phosphates commenced trial production of Single Super Phosphate, or SSP, fertiliser on 11 November 2026 at Phase I of its greenfield facility in the MIDC Industrial Area at Nardana, Dhule, Maharashtra. Management said it expects full-scale commercial production shortly after obtaining the required statutory approvals. With the new facility’s operations, aggregate SSP capacity stands at 9.14 lakh metric tonnes per annum.

Rama Phosphates also disclosed that Phase II activities at Nardana have started, without giving an investment amount, commissioning date or additional capacity figure. Capital work in progress was Rs 69.48 crore at 30 September 2026, compared with Rs 47.53 crore at 31 March 2026, while property, plant and equipment was Rs 155.02 crore versus Rs 157.40 crore. The filing does not separately allocate the first-half capital expenditure between the Nardana project and other assets.

Conclusion

Rama Phosphates’ first-half figures show a profit increase alongside a cash-conversion reversal. Profit before tax rose by Rs 4.69 crore and the core Fertilizers, Micro Nutrients & Chemicals segment added Rs 6.07 crore of segment result, but working-capital movements of Rs 77.93 crore turned Rs 60.20 crore of pre-working-capital operating profit into a Rs 19.15 crore operating cash outflow.

The next reported periods will show whether government subsidies receivable of Rs 158.08 crore, trade receivables of Rs 84.40 crore and other current assets of Rs 73.95 crore convert into cash. Investors can also watch for statutory approvals and management’s stated move from trial to full-scale commercial SSP production at Nardana, where Phase II activities have begun.