Subex operating cash flow falls to Rs 27.74 crore in first half

Subex Limited generated Rs 27.74 crore of operating cash flow in the six months ended September 30, 2026, down from Rs 32.85 crore a year earlier, as Rs 65.63 crore of investing outflows reduced cash and cash equivalents to Rs 39.95 crore. The cash deployment included deposits, bonds and commercial paper.

How did Subex's operating cash flow change in the first half?

Subex's net cash flow from operating activities fell by Rs 5.11 crore year on year to Rs 27.74 crore in the six months ended September 30, 2026. This was despite profit before tax rising to Rs 33.48 crore from Rs 18.93 crore in the comparable six months ended September 30, 2025.

Operating profit before working-capital changes rose to Rs 30.61 crore from Rs 8.31 crore. The 2026 figure included Rs 5.33 crore of depreciation and amortisation, Rs 1.88 crore of trade-receivable impairment allowance and Rs 1.22 crore of finance costs, partly offset by Rs 6.35 crore of interest income and Rs 4.50 crore of unrealised foreign-exchange gains.

Working-capital movements produced a Rs 0.64 crore net outflow in the 2026 half year, compared with a Rs 6.85 crore net outflow a year earlier, based on the individual movements in the cash-flow statement. A Rs 13.97 crore increase in other current liabilities partly offset Rs 6.52 crore invested in other financial and current assets, a Rs 4.45 crore reduction in other financial liabilities and a Rs 1.61 crore increase in trade receivables.

Did Subex's higher profit convert into higher operating cash?

No, Subex's first-half profit increased while its operating cash flow declined to Rs 27.74 crore from Rs 32.85 crore. Revenue increased to Rs 165.05 crore from Rs 135.31 crore, and net profit rose to Rs 28.51 crore from Rs 15.67 crore, but cash flow was affected by working-capital changes and tax payments.

The cash-flow statement shows cash before income-tax payments of Rs 29.97 crore in the 2026 half year, compared with Rs 1.46 crore a year earlier. Income tax paid, net of refunds, was Rs 2.23 crore in 2026, while the corresponding payment was Rs 31.39 crore in 2025, resulting in reported operating cash flows of Rs 27.74 crore and Rs 32.85 crore respectively.

Management reported normalised earnings before interest, tax, depreciation and amortisation, or EBITDA, of Rs 34.64 crore for the 2026 first half, compared with Rs 11.58 crore a year earlier. The company defines this measure as excluding trade-receivable impairment allowances, which were Rs 1.88 crore in 2026 and Rs 1.37 crore in 2025.

Where did Subex deploy cash in the first half?

Subex used Rs 65.63 crore in investing activities in the six months ended September 30, 2026, compared with Rs 23.46 crore generated from investing activities in the prior-year period. The shift included Rs 49.21 crore of net investment in deposits, Rs 20.25 crore invested in bonds and Rs 4.73 crore invested in commercial paper.

Mutual-fund activity generated a net Rs 9.08 crore inflow in the 2026 half year, with Rs 87.58 crore of sale proceeds and Rs 78.50 crore of purchases. Subex also spent Rs 3.51 crore on property, plant and equipment, intangible assets and capital advances, while receiving Rs 2.99 crore of interest.

The balance sheet records a higher allocation to financial assets at September 30, 2026. Current investments increased to Rs 41.76 crore from Rs 25.02 crore at March 31, 2026, non-current investments rose to Rs 19.29 crore from Rs 6.91 crore, and other balances with banks increased to Rs 76.54 crore from Rs 18.45 crore.

Why did Subex's cash-equivalent balance fall?

Subex's cash and cash equivalents fell by Rs 42.39 crore to Rs 39.95 crore at September 30, 2026 from Rs 82.18 crore at March 31, 2026. The reduction reflected the Rs 65.63 crore investing outflow exceeding the Rs 27.74 crore operating inflow, with financing activities using a further Rs 4.50 crore.

Financing cash outflow consisted of Rs 1.22 crore of interest paid on lease liabilities and Rs 3.28 crore of principal repayment on lease liabilities. In the six months ended September 30, 2025, financing activities used Rs 4.04 crore, including Rs 1.69 crore of lease interest and Rs 3.22 crore of principal repayments, partly offset by Rs 0.87 crore received from employee stock-option exercises.

A Rs 0.16 crore foreign-exchange gain on cash and cash equivalents partly offset the cash reduction in the 2026 half year. The balance-sheet figures show that cash equivalents declined as bank balances and investments increased, although the filing does not disclose the maturity profile, liquidity terms or returns for the deposits, bonds and other bank balances.

How did Subex's balance sheet change by September 2026?

Subex's total assets increased to Rs 599.07 crore at September 30, 2026 from Rs 551.90 crore at March 31, 2026, while total equity rose to Rs 383.33 crore from Rs 342.81 crore. Other equity increased to Rs 102.33 crore from Rs 61.81 crore, while equity share capital remained Rs 281.00 crore.

Trade receivables increased to Rs 97.84 crore from Rs 93.51 crore over the six-month period, alongside the Rs 1.61 crore receivables increase in the cash-flow statement. Total liabilities rose to Rs 215.74 crore from Rs 209.09 crore, while combined current and non-current lease liabilities declined to Rs 24.98 crore from Rs 28.27 crore.

The asset movement shows that the decline in cash equivalents coincided with higher deposits, other bank balances and investments rather than a decline in total assets. At September 30, 2026, Subex held Rs 39.95 crore of cash equivalents, Rs 76.54 crore of other bank balances and Rs 61.05 crore of current and non-current investments combined.

Conclusion

Subex generated positive operating cash flow of Rs 27.74 crore in the first half ended September 30, 2026, but this was Rs 5.11 crore below the prior-year level despite higher revenue and profit. Investing outflows of Rs 65.63 crore, led by deposits, bonds and commercial paper, were the principal reason cash equivalents fell by Rs 42.39 crore.

The next cash-flow comparison should show whether Subex's Rs 165.05 crore first-half revenue and Rs 28.51 crore net profit continue to generate operating cash while its allocation to deposits, bank balances and investments changes. A remaining unresolved matter is the maturity and liquidity profile of the Rs 76.54 crore of other bank balances and Rs 61.05 crore of investments, which the filing does not provide.