SpectraA FY26 capex outpaced cash flow, funded by borrowings

SpectraA Technology Solutions Limited funded FY26 asset purchases that exceeded operating cash flow with additional borrowings. SpectraA spent Rs 12.58 crore on property, plant and equipment while operating cash flow was Rs 7.98 crore, and net borrowings were Rs 9.75 crore. Total borrowings stood at Rs 26.96 crore at March 31, 2026.

Why did SpectraA's FY26 capex exceed operating cash flow?

SpectraA's FY26 capital expenditure exceeded operating cash flow by Rs 4.60 crore because purchases of property, plant and equipment reached Rs 12.58 crore against Rs 7.98 crore of cash flow from operations. Cash flow from operations in the free-cash-flow-to-equity statement is cash generated from operating activities after income tax paid. SpectraA generated Rs 10.19 crore from operations in FY26 and paid Rs 2.21 crore of income tax.

The investment scale changed materially from FY25. SpectraA's net purchase of property, plant and equipment rose from Rs 1.77 crore in FY25 to Rs 12.58 crore in FY26, an increase of Rs 10.81 crore. Operating cash flow also increased, from Rs 60.32 lakh in FY25 to Rs 7.98 crore in FY26, but did not cover the larger FY26 asset-purchase programme. SpectraA disclosed no sale of property, plant and equipment in FY26 to offset the purchase amount.

The FY26 cash-flow statement therefore records a funding requirement beyond cash generated from operations. SpectraA's free cash flow to equity, or FCFE, calculation includes Rs 9.75 crore of net borrowings rather than a separate equity-funding line. FCFE is the residual measure after cash flow from operations, property, plant and equipment purchases, net borrowings and after-tax interest are included in the disclosed calculation.

How much did borrowings fund SpectraA's FY26 capex?

SpectraA added Rs 9.75 crore of net borrowings in FY26, the largest funding inflow disclosed in its FCFE calculation. The net-borrowing amount was more than twice the Rs 4.60 crore by which FY26 property, plant and equipment purchases exceeded operating cash flow. The statement does not allocate each borrowing to an individual asset purchase, but it records borrowing alongside the FY26 investment outlay.

The Rs 9.75 crore net-borrowing figure arose mainly from Rs 14.91 crore of long-term borrowing proceeds. SpectraA repaid Rs 3.79 crore of long-term borrowings, while the statement recorded Rs 1.36 crore as short-term borrowing proceeds, producing the reported net amount. In FY25, net borrowings were Rs 3.02 crore, compared with Rs 9.75 crore in FY26, an increase of Rs 6.73 crore alongside the Rs 10.81 crore rise in net property, plant and equipment purchases.

SpectraA reported FCFE of Rs 2.20 crore in FY26, compared with Rs 42.76 lakh in FY25 and Rs 1.26 crore in FY24. The FY26 calculation included Rs 2.96 crore of after-tax interest, derived from total interest expense of Rs 3.96 crore and an effective tax rate of 25%. This calculation shows that borrowing supported cash availability after the higher asset purchases and interest costs were accounted for.

What was SpectraA's debt position before the offer?

SpectraA reported total borrowings of Rs 26.96 crore and total equity of Rs 24.81 crore at March 31, 2026, resulting in a borrowings-to-total-equity ratio of 1.09. Borrowings were Rs 2.16 crore higher than total equity on the restated consolidated basis. Total equity comprised Rs 10.09 crore of equity share capital and Rs 14.72 crore of other equity.

The March 31, 2026 borrowing balance comprised Rs 10.15 crore of current borrowings and Rs 16.82 crore of non-current borrowings, including current maturities. SpectraA reported non-current borrowings equal to 0.68 times total equity in its capitalisation statement. The company did not provide adjusted post-offer capitalisation figures because those figures depended on completion of the book-building process and finalisation of the offer price.

Secured borrowings accounted for Rs 21.68 crore, or about 80% of SpectraA's Rs 26.96 crore borrowings at March 31, 2026, while unsecured borrowings accounted for Rs 5.29 crore. By August 31, 2026, total borrowings had fallen to Rs 22.98 crore, comprising Rs 17.85 crore of secured borrowings and Rs 5.12 crore of unsecured borrowings. That later balance was Rs 3.99 crore below the March 2026 amount, but it does not change the March 2026 capitalisation ratio.

Which facilities supported capex and working capital?

SpectraA disclosed term and asset-finance facilities designated for capital expenditure. A Federal Bank Ltd. term loan sanctioned on June 30, 2025 had Rs 8.19 crore outstanding at March 31, 2026 and was identified for capital expenditure. A Siemens Financial Services Private Limited facility sanctioned on November 20, 2024 had Rs 24.85 lakh outstanding at March 31, 2026 for a 50-kilowatt solar panel and a hydraulic press.

SpectraA also used facilities designated for working capital, including purchases of raw materials and other manufacturing-related operations. A Federal Bank Ltd. cash-credit facility had Rs 6.26 crore outstanding at March 31, 2026, while another Federal Bank Ltd. working-capital facility had Rs 3.13 crore outstanding at that date. Cash credit is a revolving bank facility, and the disclosed Federal Bank cash-credit rate was 9% per annum, linked to the repo rate plus 3.75%.

Unsecured loans included bank and non-bank facilities for working capital, raw-material purchases and asset purchases. HDFC Bank Limited had Rs 59 lakh outstanding at March 31, 2026 for working capital, while ICICI Bank had Rs 75 lakh outstanding under a facility described as a personal loan for business use. These facility-level disclosures show multiple funding channels, while the cash-flow statement reports the combined FY26 net-borrowing amount of Rs 9.75 crore.

Conclusion

SpectraA's FY26 cash-flow profile shows property, plant and equipment purchases of Rs 12.58 crore against operating cash flow after tax of Rs 7.98 crore. The Rs 4.60 crore gap coincided with Rs 9.75 crore of net borrowings, while March 31, 2026 total borrowings of Rs 26.96 crore exceeded total equity of Rs 24.81 crore.

The next disclosed balance-sheet development is the decline in total borrowings to Rs 22.98 crore at August 31, 2026 from Rs 26.96 crore at March 31, 2026. Adjusted post-offer capitalisation remains unresolved because SpectraA stated that the figure could not be determined before completion of book building and finalisation of the offer price.