Tube Investments of India Limited cash flow falls to Rs 435.50 crore

TII generated Rs 435.50 crore of net operating cash in the half year ended 30 September 2026, down from Rs 640.05 crore a year earlier, as trade and other receivables absorbed Rs 1,026.24 crore and inventories absorbed Rs 748.84 crore despite higher profit before tax.

Why did TII's operating cash flow decline?

TII's operating cash flow declined because working-capital outflows and higher tax payments more than offset the rise in operating profit. Cash generated from operations was Rs 853.01 crore for the half year ended 30 September 2026, compared with Rs 1,005.92 crore in the corresponding 2025 period, before income-tax payments reduced net operating cash to Rs 435.50 crore.

Profit before tax from continuing operations increased to Rs 1,104.60 crore from Rs 907.95 crore, a rise of Rs 196.65 crore. Operating profit before working-capital and other changes also rose to Rs 1,377.02 crore from Rs 1,177.33 crore, but cash generated from operations fell by Rs 152.91 crore as more cash was tied up in operating balances.

Net income tax paid was Rs 417.51 crore in the half year ended 30 September 2026, compared with Rs 365.87 crore in the prior-year period. The Rs 51.64 crore increase in tax payments, together with the decline in cash generated from operations, reduced net cash from operating activities by Rs 204.55 crore year on year.

How did receivables and inventory affect TII's cash?

Receivables and inventories were the largest disclosed uses of TII's operating cash during the September 2026 half year. Trade and other receivables absorbed Rs 1,026.24 crore, compared with Rs 253.43 crore in the corresponding 2025 period, an increase of Rs 772.81 crore in the cash outflow.

Inventories absorbed Rs 748.84 crore, compared with Rs 355.52 crore in the prior-year half year. On the balance sheet, inventories stood at Rs 3,601.34 crore on 30 September 2026, up from Rs 2,852.68 crore on 31 March 2026, while trade receivables rose to Rs 5,394.98 crore from Rs 4,366.83 crore over the same six-month period.

The working-capital outflows were partly offset by liability increases. Trade and other payables provided Rs 995.85 crore of cash in the 2026 half year, compared with Rs 437.74 crore a year earlier, while current and non-current liabilities provided another Rs 530.77 crore, versus Rs 736.92 crore.

Other current and non-current assets used Rs 287.55 crore of cash, compared with Rs 137.15 crore in the half year ended 30 September 2025. Other current assets were Rs 1,005.89 crore at 30 September 2026, up from Rs 732.72 crore at 31 March 2026, and other financial assets were Rs 2,148.97 crore, compared with Rs 1,850.35 crore.

What did TII spend on investments and acquisitions?

TII used Rs 371.33 crore in investing activities in the half year ended 30 September 2026, substantially below the Rs 3,871.69 crore used in the prior-year period. The principal capital-expenditure line was Rs 878.61 crore for property, plant and equipment, intangible assets and capital work-in-progress, down from Rs 1,067.25 crore a year earlier.

Property, plant and equipment increased to Rs 3,789.03 crore at 30 September 2026 from Rs 3,434.45 crore at 31 March 2026. Capital work-in-progress rose to Rs 1,060.84 crore from Rs 806.37 crore, alongside the continuing investment disclosed in the cash-flow statement.

Investing cash flow included Rs 30.41 crore of consideration for acquiring equity shares in Tosil Systems Private Limited and Orange Koi Private Limited, net of cash acquired. The filing states that Orange Koi became a subsidiary on 6 April 2026 after TII acquired 76.24% for total consideration of Rs 35 crore, while CG Power and Industrial Solutions Limited acquired Tosil for Rs 16.44 crore during the September 2026 quarter.

A Rs 767.66 crore net redemption of current investments and Rs 299.30 crore from deposits, other bank balances and the fabless semiconductor design business offset part of the investing outflow. Interest income received was Rs 64.41 crore, compared with Rs 47.41 crore a year earlier, while proceeds from property, plant and equipment sales were Rs 6.32 crore.

How did TII's cash balance and financing change?

TII ended 30 September 2026 with total cash and cash equivalents of Rs 569.32 crore, up from Rs 533.16 crore at the beginning of the year. The Rs 36.16 crore increase reflected the Rs 435.50 crore operating inflow exceeding the Rs 371.33 crore investing outflow and Rs 28.01 crore financing outflow.

Financing activities moved from an inflow of Rs 2,838.75 crore in the half year ended 30 September 2025 to an outflow of Rs 28.01 crore in 2026. The prior-year period included Rs 3,000 crore of proceeds from a qualified institutions placement, while the current period included Rs 104.97 crore of net short-term borrowing proceeds, Rs 25 crore from compulsorily convertible preference shares and Rs 27.52 crore from employee stock-option exercises.

Current borrowings stood at Rs 438.71 crore at 30 September 2026, compared with Rs 334.07 crore at 31 March 2026, while non-current borrowings rose to Rs 63.71 crore from Rs 58.30 crore. Financing outflows included Rs 42.75 crore for lease principal, Rs 26.07 crore of finance costs, Rs 33.80 crore of dividends and Rs 77.72 crore for acquisition of non-controlling interest.

The filing identifies the Rs 77.72 crore payment as TII's purchase of 20,64,713 Shanthi Gears Limited shares during the September 2026 quarter, which increased its holding from 70.46% to 73.16%. TII also invested Rs 25 crore in Series D compulsorily convertible preference shares of 3xper Innoventure Limited, a subsidiary, during the quarter.

Conclusion

TII's half-year figures show that the increase in profit did not translate proportionately into operating cash. Profit before tax from continuing operations rose to Rs 1,104.60 crore, but cash absorbed by receivables, inventories and other assets reduced net operating cash to Rs 435.50 crore from Rs 640.05 crore in the half year ended 30 September 2025.

The next results will show whether trade receivables of Rs 5,394.98 crore and inventories of Rs 3,601.34 crore convert into cash, while capital work-in-progress of Rs 1,060.84 crore continues to require funding. The filing also states that CG Power and Industrial Solutions Limited had utilised Rs 660.39 crore of its Rs 3,000 crore qualified institutions placement proceeds by 30 September 2026, with the unutilised amount temporarily invested or kept in a monitoring account.