Scoda Tubes FY26 operating cash flow turned to Rs 13.8 crore outflow

Scoda Tubes Limited grew revenue from operations at a 19.3% compound annual growth rate from FY23 to FY26, reaching Rs 518.7 crore, but its FY26 cash flow from operations was negative Rs 13.8 crore after a Rs 78.9 crore working-capital outflow. The figures show profit growth and asset expansion alongside more cash tied up in inventory and receivables.

How fast did Scoda Tubes grow revenue and profit through FY26?

Scoda Tubes increased revenue from operations to Rs 518.7 crore in FY26 from Rs 305.1 crore in FY23, a reported three-year compound annual growth rate, or CAGR, of 19.3%. Revenue rose in every reported year, reaching Rs 399.9 crore in FY24 and Rs 484.9 crore in FY25. The Rs 33.8 crore increase in FY26 was smaller than the Rs 85.0 crore increase recorded in FY25.

Profit after tax, or PAT, increased faster than revenue, reaching Rs 38.8 crore in FY26 from Rs 10.3 crore in FY23, for a reported three-year CAGR of 55.4%. PAT rose from Rs 18.3 crore in FY24 and Rs 31.7 crore in FY25, while PAT margin expanded from 3.4% in FY23 to 7.5% in FY26. Earnings per share, or EPS, nevertheless declined to Rs 6.8 in FY26 from Rs 7.6 in FY25 despite the increase in PAT.

What happened to Scoda Tubes margins in FY26?

Scoda Tubes' EBITDA declined to Rs 76.2 crore in FY26 from Rs 78.1 crore in FY25, even as revenue increased by Rs 33.8 crore. EBITDA margin consequently fell to 14.7% from 16.1%, although it remained above the 11.4% reported in FY23. The company reports a 29.9% three-year CAGR in EBITDA, compared with 19.3% for revenue.

Gross profit grew to Rs 165.4 crore in FY26 from Rs 148.5 crore in FY25, and gross profit margin improved to 31.9% from 30.6%. The FY26 gross profit margin was still below the 34.5% recorded in FY24. Cost of materials consumed, including changes in work in progress and finished goods, increased to Rs 353.2 crore from Rs 336.4 crore, while other expenses rose to Rs 78.7 crore from Rs 62.4 crore.

Below EBITDA, Scoda Tubes reported Rs 10.6 crore of other income in FY26, compared with Rs 4.0 crore in FY25, while depreciation and amortisation fell to Rs 9.2 crore from Rs 18.1 crore. Finance costs increased to Rs 24.9 crore from Rs 22.0 crore. These reported movements coincided with profit before tax increasing to Rs 52.7 crore from Rs 41.9 crore and PAT rising by Rs 7.1 crore year on year.

Why did Scoda Tubes report negative operating cash flow in FY26?

Scoda Tubes reported negative Rs 13.8 crore of cash flow from operations in FY26 because a Rs 78.9 crore working-capital outflow and Rs 17.6 crore of net direct taxes paid exceeded its Rs 82.8 crore operating profit before working-capital changes. It had reported positive operating cash flow of Rs 18.4 crore in FY25, Rs 2.2 crore in FY24 and Rs 20.3 crore in FY23.

The working-capital outflow widened from negative Rs 54.6 crore in FY25 to negative Rs 78.9 crore in FY26. Inventory days rose to 217 from 163, debtor days increased to 97 from 76, and the cash conversion cycle extended to 211 days from 164 days. Compared with FY23, inventory days increased by 46 days, debtor days by 35 days and the cash conversion cycle by 60 days.

The balance sheet records the cash commitment behind those day-count measures. Inventories rose to Rs 209.8 crore in FY26 from Rs 149.8 crore in FY25, while trade receivables increased to Rs 138.0 crore from Rs 101.0 crore. Together, these balances increased by Rs 97.0 crore in FY26, against Rs 33.8 crore of revenue growth. Trade payables also rose to Rs 99.4 crore from Rs 68.5 crore, but did not offset the reported working-capital movement.

How did Scoda Tubes fund its FY26 expansion and balance-sheet growth?

Scoda Tubes funded Rs 149.9 crore of FY26 investing cash outflow with Rs 152.7 crore of financing cash inflow, while cash and cash equivalents at the end of the period fell to Rs 4.1 crore from Rs 15.1 crore. The investing outflow was substantially higher than Rs 43.9 crore in FY25, alongside fixed assets increasing to Rs 194.0 crore from Rs 103.5 crore.

Total assets increased to Rs 687.9 crore in FY26 from Rs 446.4 crore in FY25 and Rs 238.3 crore in FY23. Equity capital and reserves rose to Rs 390.3 crore from Rs 150.4 crore during FY26, while borrowings decreased to Rs 185.3 crore from Rs 210.2 crore. As reported by Scoda Tubes, net debt to equity declined to 0.3 in FY26 from 1.1 in FY25 and 2.8 in both FY23 and FY24.

Returns moved in the opposite direction to balance-sheet expansion in FY26. Return on equity, or ROE, declined to 9.9% from 21.1% in FY25, and return on capital employed, or ROCE, fell to 11.6% from 16.6%. The FY26 fixed-asset balance was Rs 90.5 crore higher year on year, while revenue increased by Rs 33.8 crore over the same period.

Conclusion

Scoda Tubes' FY23-to-FY26 record combines sustained sales growth, higher gross profit and a near fourfold increase in PAT with a FY26 decline in EBITDA and return measures. Revenue reached Rs 518.7 crore and PAT reached Rs 38.8 crore, but negative Rs 13.8 crore operating cash flow shows that the FY26 expansion required materially more funding for inventory and receivables.

The next disclosed operating milestones are Scoda Tubes' capacity plans for FY27 and FY28. The company lists post-expansion seamless capacity of 20,068 metric tonnes per annum, or MTPA, welded capacity of 21,150 MTPA and mother-hollow capacity of 20,000 MTPA. Execution of those additions, together with changes in working capital and financing cash flow, will be relevant measures to watch.