Servotech September-quarter profit rises to Rs 8.37 crore

Servotech Renewable Power System Limited reported standalone profit of Rs 8.3739 crore for the quarter ended 30 September 2026, compared with Rs 2.2723 crore a year earlier, as total revenue rose to Rs 158.6234 crore from Rs 102.9263 crore. The result included a Rs 1.53 crore net loss from an inventory and invoice fraud.

How did Servotech perform in the September 2026 quarter?

Servotech’s standalone profit for the quarter ended 30 September 2026 was Rs 8.3739 crore, up from Rs 2.2723 crore in the quarter ended 30 September 2025. Total revenue increased by Rs 55.6971 crore year on year to Rs 158.6234 crore, while revenue from operations rose to Rs 157.2323 crore from Rs 101.9967 crore.

The September quarter was lower than the preceding June 2026 quarter on both revenue and profit. Total revenue declined from Rs 208.1119 crore in the June quarter to Rs 158.6234 crore, while profit for the period fell from Rs 11.1006 crore to Rs 8.3739 crore. The year-on-year comparison nevertheless showed a higher September-quarter outcome than in 2025.

Servotech reported basic earnings per share of Rs 0.37 for the September 2026 quarter, compared with Rs 0.19 a year earlier and Rs 0.49 in the June 2026 quarter. Diluted earnings per share were also Rs 0.37 for the September quarter. The company’s standalone accounts state that it operates in a single segment under Indian Accounting Standard 108.

What do Servotech’s first-half results show?

Servotech reported standalone profit of Rs 19.4740 crore for the half year ended 30 September 2026, against Rs 9.8229 crore for the half year ended 30 September 2025. Total revenue for the six-month period rose to Rs 366.9354 crore from Rs 228.0621 crore, an increase of Rs 138.8733 crore.

Revenue from operations for the half year reached Rs 364.8383 crore, compared with Rs 225.4414 crore in the corresponding prior-year period. Profit before tax increased to Rs 25.7608 crore from Rs 13.1443 crore. The half-year tax charge included current tax of Rs 6.4520 crore and a deferred-tax credit of Rs 0.1817 crore.

The six-month total revenue of Rs 366.9354 crore was more than half of Servotech’s Rs 641.6519 crore total revenue for the full year ended 31 March 2026. Full-year profit for that prior year was Rs 36.2684 crore, compared with Rs 19.4740 crore in the first six months of 2026-27. These are standalone figures rather than the group’s consolidated results.

How did Servotech’s balance sheet change by September 2026?

Servotech’s standalone total assets were Rs 605.5912 crore at 30 September 2026, down from Rs 621.5760 crore at 31 March 2026. Non-current assets declined to Rs 159.7215 crore from Rs 176.3805 crore, while current assets were broadly stable at Rs 445.8696 crore against Rs 445.1956 crore.

Inventories increased to Rs 70.3378 crore at 30 September from Rs 55.6429 crore at 31 March. Current trade receivables declined to Rs 174.9195 crore from Rs 208.9423 crore, while cash and cash equivalents increased to Rs 5.7545 crore from Rs 0.6290 crore. Other bank balances rose to Rs 68.1051 crore from Rs 63.9125 crore.

Total equity increased to Rs 286.6477 crore at 30 September 2026 from Rs 267.1737 crore at 31 March 2026. Equity share capital was unchanged at Rs 22.5845 crore, while other equity increased to Rs 264.0632 crore from Rs 244.5892 crore. The movement in other equity broadly corresponded with the first-half profit of Rs 19.4740 crore.

Why was Servotech’s operating cash flow negative?

Servotech used Rs 27.1156 crore in operating activities during the half year ended 30 September 2026 despite reporting profit before tax of Rs 25.7608 crore. Operating profit before working-capital changes was Rs 41.2331 crore, and net taxes paid were Rs 8.8195 crore, leaving Rs 32.4136 crore before the working-capital movements recorded in the cash-flow statement.

Working-capital movements reduced cash generation during the half year. Inventories used Rs 14.7948 crore, while other financial assets, provisions and other balances used Rs 12.4986 crore. Trade payables and other related balances used Rs 84.6644 crore, partly offset by a Rs 45.8856 crore reduction in trade receivables and a Rs 6.6433 crore increase in other liabilities.

Financing activities generated Rs 37.1933 crore in the six months, including Rs 47.0890 crore from loan proceeds and repayments on a net basis. Finance costs paid were Rs 9.5740 crore, and investing activities used Rs 0.7598 crore, including Rs 2.6807 crore spent on fixed assets. Cash and cash equivalents in the cash-flow statement increased by Rs 9.3180 crore to Rs 73.8595 crore at 30 September 2026.

What was the impact of Servotech’s disclosed inventory fraud?

Servotech said it detected during the September 2026 quarter a fraud involving unauthorised removal of inventory and forgery of tax invoices by two employees in collusion with an external party. The company estimated the loss at about Rs 2 crore to Rs 2.50 crore and said it had recovered goods and cheques valued at about Rs 75.65 lakh.

Servotech recognised a Rs 1.53 crore net loss in the September-quarter statement of profit and loss. It said a first information report had been registered, both employees had been arrested, and the investigation remained ongoing. The notes state that any further impact will be recognised when determined, following disclosures to stock exchanges dated 23 July 2026 and 14 October 2026.

Conclusion

Servotech’s September 2026 standalone result combined year-on-year growth in revenue and profit with a sequential decline from the June quarter. First-half profit reached Rs 19.4740 crore as total revenue reached Rs 366.9354 crore, but the cash-flow statement showed Rs 27.1156 crore used in operating activities, largely through inventory, payable and other working-capital movements.

The next disclosed matter to watch is the ongoing investigation into the inventory and invoice fraud, for which Servotech had recognised a Rs 1.53 crore net loss by 30 September 2026. The company’s subsequent results will also show whether inventories of Rs 70.3378 crore, borrowings of Rs 243.1844 crore across current and non-current categories, and operating cash flow change after the half-year balance-sheet movements.