Sharda Motor operating cash flow rises 83% to Rs 265.41 crore

Sharda Motor Industries Limited generated Rs 265.41 crore of net cash from operating activities in the six months ended September 30, 2026, up 83% from Rs 145.00 crore a year earlier. A Rs 150.50 crore reduction in inventories supported the increase, while cash and cash equivalents rose to Rs 114.74 crore from Rs 91.64 crore at the start of the period.

How much operating cash did Sharda Motor generate?

Sharda Motor generated Rs 265.41 crore in net operating cash during the period ended September 30, 2026, compared with Rs 145.00 crore in the corresponding 2025 period. The increase of Rs 120.41 crore came after income-tax payments of Rs 59.38 crore, compared with Rs 52.64 crore in the prior-year half.

Cash generated from operations before tax rose to Rs 324.78 crore from Rs 197.64 crore, an increase of Rs 127.14 crore. The cash-flow statement began its reconciliation with profit before tax of Rs 232.28 crore for the September 2026 half year, against Rs 200.22 crore a year earlier, indicating that working-capital movements and non-cash adjustments contributed materially to the larger cash increase.

The 83% increase applies to net cash from operating activities after tax, rather than to profit before tax. Sharda Motor’s consolidated results identify manufacturing and trading of auto-component parts as the group’s only reportable segment under Indian Accounting Standard 108, or Ind AS 108, and therefore do not provide separate cash-flow data by product line or business unit.

What drove Sharda Motor's operating cash increase?

A Rs 150.50 crore decrease in inventories was the largest disclosed working-capital movement behind Sharda Motor’s operating cash flow in the six months ended September 30, 2026. The statement also recorded a Rs 10.78 crore increase in trade payables and a Rs 3.45 crore decrease in other assets, which added to cash generated from operations.

The comparable period in 2025 had recorded a Rs 57.96 crore inventory decrease. The Rs 92.54 crore larger inventory-related movement in the 2026 half year was greater than the Rs 32.05 crore increase in profit before tax, helping explain why cash generated from operations increased to Rs 324.78 crore from Rs 197.64 crore.

Sharda Motor also adjusted accounting profit for specified non-cash and non-operating items. Depreciation and amortisation of Rs 31.40 crore and finance cost of Rs 2.46 crore were added back, while interest income of Rs 12.51 crore was deducted in the reconciliation for the September 2026 half year.

Other adjustments included a Rs 6.07 crore gain on disposal of property, plant and equipment, a Rs 3.95 crore gain on sale of investments and a Rs 0.83 crore warranty-provision write-back. These entries are part of the reported bridge from profit before tax to cash from operations and do not separately identify customer collections from auto-component sales.

How did investing and financing activities use Sharda Motor's cash?

Sharda Motor used Rs 123.83 crore in investing activities in the six months ended September 30, 2026, compared with Rs 182.01 crore in the corresponding period a year earlier. The investing outflow narrowed by Rs 58.18 crore, but remained a substantial use of the operating cash generated during the half year.

The investing cash flow included Rs 47.29 crore spent on property, plant and equipment, including capital work-in-progress and intangible assets. Movement in earmarked bank balances used Rs 187.07 crore, while realised bank deposits contributed Rs 29.26 crore and interest received added Rs 4.76 crore.

Financing activities used Rs 118.54 crore in the September 2026 half year, compared with an outflow of Rs 98.87 crore in the prior-year period. Dividends paid were Rs 114.82 crore, with finance costs paid of Rs 2.46 crore, lease-liability payments of Rs 1.26 crore and bonus-issue expenses of Rs 0.10 crore also reported as financing cash uses.

The three-category comparison shows a different cash-flow pattern from the preceding year. Operating cash rose by Rs 120.41 crore and investing outflows fell by Rs 58.18 crore, while financing outflows increased by Rs 19.67 crore. After these movements and the reported effects of fair-value and foreign-exchange changes, cash and cash equivalents increased by Rs 23.10 crore, reversing a Rs 133.14 crore decrease in the comparable 2025 half year.

What was Sharda Motor's cash position at September 30, 2026?

Sharda Motor ended September 30, 2026 with cash and cash equivalents of Rs 114.74 crore, up from Rs 91.64 crore at the beginning of the period. The corresponding September 2025 closing balance was Rs 65.73 crore, following the prior-year period’s reported net decline in cash and cash equivalents of Rs 133.14 crore.

The September 2026 closing balance included Rs 96.46 crore in current accounts and Rs 18.27 crore in unclaimed-fund cash and cash equivalents. Cash on hand was Rs 0.23 lakh and the balance in Exchange Earners’ Foreign Currency accounts was Rs 1.40 lakh.

Cash and cash equivalents were separate from other bank balances and current investments in the statement of assets and liabilities. At September 30, 2026, Sharda Motor reported Rs 968.39 crore of current investments and Rs 14.35 crore of bank balances other than cash and cash equivalents, alongside the Rs 114.74 crore cash-equivalent balance.

The board considered and approved the consolidated results on November 12, 2026, and the statutory auditors issued an unmodified review opinion. The auditor noted unreviewed interim information for one associate, one joint venture and one subsidiary, but stated that those amounts were not material to the group’s interim financial results.

Conclusion

Sharda Motor converted higher reported earnings and working-capital movements into Rs 265.41 crore of net operating cash in the September 2026 half year, compared with Rs 145.00 crore a year earlier. The Rs 150.50 crore inventory decrease was the largest disclosed contributor, and the operating inflow exceeded the combined Rs 242.36 crore of investing and financing outflows, allowing cash and cash equivalents to rise by Rs 23.10 crore.

The next reporting period will indicate whether the inventory-related cash release continues and how the Rs 47.29 crore spent on property, plant and equipment develops. Future filings will also show the effect of any further dividend payments, after dividends accounted for Rs 114.82 crore of Sharda Motor’s Rs 118.54 crore financing outflow in the first half.