Steel Exchange India posts Rs 119.38 crore operating outflow

Steel Exchange India Limited recorded net cash used in operating activities of Rs 119.38 crore for the half year ended 30 September 2026, despite reporting profit before tax of Rs 32.65 crore. Increases in inventories, trade receivables and other financial assets accounted for at least Rs 165.14 crore of cash use, while financing activities generated Rs 131.76 crore.

Why did Steel Exchange India report negative operating cash flow?

Steel Exchange India reported negative operating cash flow because working-capital movements outweighed its Rs 74.17 crore operating profit before working-capital changes in the half year ended 30 September 2026. The largest disclosed outflows were an Rs 84.37 crore increase in other financial assets, an Rs 53.08 crore increase in inventories and an Rs 27.69 crore increase in trade receivables.

The company also recorded a Rs 17.85 crore decrease in other current liabilities and a Rs 12.78 crore decrease in trade payables during the period. Those movements, partly offset by Rs 2.09 crore from deferred revenue expenditure, Rs 48.85 lakh from other financial liabilities and Rs 28.22 lakh from other current assets, resulted in cash generated from operations of negative Rs 119.38 crore. No minimum alternate tax credit entitlement was recorded for the half year.

How did Steel Exchange India profit compare with cash generation?

Steel Exchange India earned Rs 32.65 crore before tax in the half year ended 30 September 2026, compared with Rs 12.34 crore in the corresponding half year ended 30 September 2025. No tax expense was recorded in either half-year period, leaving reported net profit at Rs 32.65 crore, versus Rs 12.34 crore a year earlier.

Non-cash and financing-related adjustments added Rs 41.52 crore to half-year profit before working-capital movements. Finance costs contributed Rs 28.10 crore, depreciation and impairment of property, plant and equipment added Rs 12.70 crore, and impairment allowance for doubtful debts and other receivables added Rs 71.88 lakh. The resulting Rs 74.17 crore operating profit did not translate into operating cash because the disclosed working-capital outflows exceeded that amount.

Revenue from operations increased to Rs 612.87 crore in the September 2026 half year from Rs 531.76 crore a year earlier, while profit before tax rose by Rs 20.31 crore. Steel generated Rs 58.67 crore of segment result before finance cost, power recorded an Rs 1.02 crore loss, and logistics contributed Rs 3.10 crore, producing total segment result of Rs 60.75 crore before Rs 28.10 crore of finance cost.

Which balance-sheet items absorbed Steel Exchange India cash?

Steel Exchange India inventories rose to Rs 448.74 crore at 30 September 2026 from Rs 395.66 crore at 31 March 2026, an increase of Rs 53.08 crore that matches the cash-flow statement’s inventory outflow. Trade receivables increased by Rs 26.97 crore to Rs 248.38 crore, while debtor turnover improved to 70 days for the half year from 76 days in the prior-year half year.

Other financial assets increased to Rs 148.27 crore at 30 September 2026 from Rs 63.91 crore at 31 March 2026. That Rs 84.37 crore increase was the largest individual working-capital cash use disclosed in the cash-flow statement. The filing does not provide a further breakdown of that balance beyond its classification as other financial assets.

Current assets rose to Rs 865.99 crore from Rs 703.75 crore over the six months, while current liabilities increased to Rs 336.92 crore from Rs 316.40 crore. The current ratio was 2.57 times at 30 September 2026, compared with 2.22 times at 31 March 2026, using the company’s stated current-assets-to-current-liabilities calculation.

How did Steel Exchange India fund its first-half cash requirement?

Steel Exchange India generated Rs 131.76 crore from financing activities in the half year, covering most of the Rs 119.38 crore operating outflow and Rs 14.27 crore investing outflow. The principal disclosed financing inflow was Rs 139.83 crore of proceeds from share warrants, followed by Rs 48.78 crore from increased short-term borrowings and Rs 28.17 crore from securities premium reserve.

The company also received Rs 11.19 crore of term-loan proceeds and Rs 2.83 crore from issue of equity shares. These inflows were partly offset by Rs 46.74 crore of non-convertible debenture repayments, Rs 30.13 crore of term-loan repayments and Rs 24.08 crore of finance-cost payments. Net cash and cash equivalents declined by Rs 1.89 crore, from Rs 5.54 crore at the beginning of the year to Rs 3.64 crore at period end.

Short-term borrowings on the balance sheet increased to Rs 196.20 crore at 30 September 2026 from Rs 149.56 crore at 31 March 2026, while non-current borrowings fell to Rs 206.34 crore from Rs 267.98 crore. Total specified borrowings in the asset-coverage disclosure declined to Rs 399.50 crore from Rs 414.53 crore, including non-convertible debentures that fell to Rs 148.28 crore from Rs 195.01 crore.

What investment spending did Steel Exchange India undertake?

Steel Exchange India used Rs 14.27 crore in investing activities during the half year ended 30 September 2026, compared with an Rs 8.12 crore investing inflow for the year ended 31 March 2026. Payments for property, plant and equipment were Rs 11.11 crore, capital work-in-progress increased by Rs 3.12 crore, and the company invested Rs 5 lakh in its wholly owned subsidiary.

The filing states that SEIL Infra Logistics Limited was incorporated on 29 June 2025 and had not commenced commercial operations as of the reporting date. Steel Exchange India made a further Rs 5 lakh investment in the subsidiary during the September 2026 quarter. Capital work-in-progress stood at Rs 9.30 crore at 30 September 2026, up from Rs 6.18 crore at 31 March 2026.

Property, plant and equipment decreased to Rs 588.41 crore from Rs 590.01 crore despite the reported Rs 11.11 crore of capital expenditure, alongside the period’s Rs 12.70 crore depreciation and impairment charge. The company received Rs 80,000 from disposal of property, plant and equipment in the half year, compared with Rs 15.18 crore in the previous full year.

Conclusion

Steel Exchange India’s first-half accounts show that Rs 32.65 crore of reported profit and Rs 612.87 crore of revenue did not result in positive operating cash flow. Inventory, receivables and other financial assets increased sufficiently to produce a Rs 119.38 crore operating outflow, with Rs 131.76 crore of financing inflows covering most of the operating and investing cash requirement.

The next disclosure should show whether the Rs 84.37 crore increase in other financial assets, Rs 53.08 crore inventory build and Rs 27.69 crore receivables increase reverse or persist. Steel Exchange India has also disclosed that SEIL Infra Logistics Limited had not begun commercial operations at 30 September 2026, making the subsidiary’s operational commencement and any further investment relevant items to watch.