Zodiac Clothing Q2 loss widens to Rs 10.32 crore as revenue falls

Zodiac Clothing Company Limited reported a consolidated net loss of Rs 10.32 crore for the quarter ended September 30, 2026, widening from Rs 8.93 crore in the preceding quarter as revenue from operations fell 8% sequentially to Rs 32.54 crore from Rs 35.31 crore.

How did Zodiac Clothing's quarterly loss and revenue change?

Zodiac Clothing's consolidated loss widened by Rs 1.39 crore quarter on quarter, from Rs 8.93 crore for the quarter ended June 30, 2026 to Rs 10.32 crore for the quarter ended September 30, 2026. Revenue from operations declined by Rs 2.77 crore over the same comparison, while total income decreased to Rs 32.88 crore from Rs 35.61 crore.

For the half year ended September 30, 2026, Zodiac Clothing reported revenue from operations of Rs 65.84 crore, compared with Rs 75.10 crore in the corresponding prior-year half. The first-half consolidated loss was Rs 19.25 crore, which represents the combined outcome of the Rs 8.93 crore first-quarter loss and the Rs 10.32 crore second-quarter loss disclosed in the results.

The company reports a single operating segment, clothing and clothing accessories, under Indian Accounting Standard 108, or Ind AS 108. As a result, the filing does not provide separate profitability figures for domestic and overseas clothing operations, although it does disclose revenue by geography.

How did domestic and overseas revenue change for Zodiac Clothing?

Zodiac Clothing's domestic revenue fell to Rs 14.00 crore in the September 2026 quarter from Rs 18.18 crore in the June 2026 quarter, while revenue outside India increased to Rs 18.54 crore from Rs 17.12 crore. The domestic decline of Rs 4.18 crore was larger than the Rs 1.42 crore increase in overseas revenue, producing the Rs 2.77 crore sequential fall in total revenue.

The September-quarter mix was weighted toward markets outside India, which accounted for Rs 18.54 crore of the Rs 32.54 crore total. Compared with the quarter ended September 30, 2025, domestic revenue declined by Rs 1.68 crore and overseas revenue declined by Rs 1.49 crore, taking total revenue lower by Rs 2.97 crore.

For the half year, domestic revenue was Rs 30.18 crore compared with Rs 33.67 crore a year earlier, while revenue outside India was Rs 35.66 crore compared with Rs 41.90 crore. Both geographies therefore contributed to the first-half revenue reduction of Rs 9.26 crore from Rs 75.10 crore to Rs 65.84 crore.

What happened to Zodiac Clothing's operating cash flow?

Zodiac Clothing used Rs 1.41 crore in operating activities during the half year ended September 30, 2026, compared with net cash generated from operating activities of Rs 7.60 crore in the corresponding prior-year period. This was a shift of Rs 9.01 crore, even as the group recorded a Rs 19.25 crore first-half loss.

The cash-flow statement shows that the reduction in trade and other receivables was Rs 5.94 crore in the latest half year, versus Rs 12.84 crore a year earlier. Inventory decreased by Rs 4.99 crore compared with a Rs 3.33 crore decline previously, while trade payables and other liabilities decreased by Rs 6.10 crore, compared with a Rs 2.02 crore decrease in the prior-year period.

Cash generated from investing activities was Rs 5.03 crore for the half year, compared with Rs 1.31 crore a year earlier. Sale proceeds from current investments were Rs 4.78 crore and rental income was Rs 1.95 crore, while spending on property, plant, equipment, intangible assets and capital work-in-progress was Rs 2.57 crore.

Financing activities used Rs 5.50 crore, compared with Rs 8.87 crore in the previous first half. Zodiac Clothing received Rs 4.00 crore in directors' loans and repaid Rs 2.00 crore of such loans, while lease-liability principal payments were Rs 6.63 crore and interest paid on lease liabilities was Rs 2.48 crore.

How did Zodiac Clothing's balance sheet change by September 2026?

Zodiac Clothing's total assets were Rs 314.39 crore at September 30, 2026, down from Rs 342.11 crore at March 31, 2026. Total equity declined to Rs 165.85 crore from Rs 181.98 crore, while total liabilities decreased to Rs 148.54 crore from Rs 160.13 crore over the same six-month period.

Cash and cash equivalents were Rs 3.95 crore at September 30, 2026, compared with Rs 5.83 crore at March 31, 2026. Current investments declined to Rs 8.62 crore from Rs 12.04 crore, inventories reduced to Rs 56.48 crore from Rs 61.47 crore, and trade receivables fell to Rs 15.50 crore from Rs 18.98 crore.

Current borrowings rose to Rs 53.74 crore at September 30, 2026 from Rs 48.24 crore at March 31, 2026. In contrast, non-current lease liabilities fell to Rs 34.93 crore from Rs 44.62 crore, and current lease liabilities were broadly unchanged at Rs 14.04 crore versus Rs 14.06 crore.

What did the auditor and filing say about Zodiac Clothing's subsidiaries?

MSKA & Associates LLP issued an unmodified review conclusion on Zodiac Clothing's consolidated unaudited results dated November 6, 2026. The engagement was a limited review under Standard on Review Engagements 2410, rather than an audit, and covered the quarter and half year ended September 30, 2026.

The group includes Zodiac Clothing Co. S.A. in Switzerland and five step-down subsidiaries in the United Arab Emirates, Bangladesh, the United States and the United Kingdom. The other auditor reviewed six subsidiaries, including five step-down subsidiaries, that had combined assets of Rs 23.95 crore, quarterly revenue of Rs 63.45 lakh and a quarterly net loss of Rs 94.63 lakh.

Zela Technologies, Inc. was voluntarily wound up on July 31, 2026. Zodiac Clothing said that entity was not carrying on significant business operations and that its winding-up had no material impact on the group's financial position or performance.

Conclusion

Zodiac Clothing's September-quarter results combined lower revenue, a wider quarterly loss and a first-half operating cash outflow. Revenue fell to Rs 32.54 crore from Rs 35.31 crore sequentially, the loss rose to Rs 10.32 crore from Rs 8.93 crore, and operating cash flow for the first half moved to an outflow of Rs 1.41 crore from an inflow of Rs 7.60 crore a year earlier.

The filing does not disclose a profit target, revenue forecast or operational plan. The unresolved measures to watch in subsequent results are whether revenue in India, which fell to Rs 14.00 crore in the September quarter, recovers, whether overseas revenue sustains its Rs 18.54 crore quarterly contribution, and whether operating cash flow returns from the reported first-half outflow.