Frick India Annual Report, Revenue & Financials

Frick India Limited Consolidated Balance Sheet (Rs in Crores)

Frick India Limited Consolidated Profit & Loss Statement (Rs in Crores)

Frick India Limited Consolidated Cash Flow Statement (Rs in Crores)

Summary of cash flow statement for the year 2026 and 2025:

Cash Flow from Operating Activities

The company’s cash flow from operating activities weakened considerably during FY26, reflecting pressure on both profitability and working capital management. Profit before tax declined significantly from ₹46.00 crore in FY25 to ₹26.26 crore in FY26, indicating lower operating earnings during the year. While non-cash adjustments such as depreciation, amortization, bad debts, and finance costs partially supported operating profit, several non-operating income items reduced overall cash generation. These included substantial interest income, liability write-backs, gains on investments, and unrealized investment gains. Consequently, operating profit before working capital changes declined to ₹25.21 crore compared to ₹36.97 crore in the previous year. The primary reason for the deterioration in cash flow was a sharp increase in inventories, which resulted in a significant cash outflow of ₹61.84 crore. This may indicate inventory accumulation, slower sales conversion, delays in project execution, or preparation for expected future demand. In addition, other assets consumed further cash during the year.On the positive side, the company achieved strong recovery in trade receivables; generating ₹23.12 crore of cash through improved customer collections. Increased liabilities and provisions also temporarily supported liquidity. However, despite these positives, operating cash flow turned negative at ₹9.99 crore after tax payments, highlighting severe inventory-driven working capital stress.

Cash Flow from Investing Activities

Investing activities continued to result in substantial cash outflows, though slightly lower than the previous year. The company earned healthy interest income of ₹6.16 crore and dividend income of ₹0.14 crore, reflecting returns from treasury investments or financial assets. Capital expenditure remained moderate with ₹4.99 crore spent on property, plant, and equipment and ₹0.12 crore on intangible assets. These investments indicate ongoing maintenance or expansion of productive capacity, though spending was lower than FY25, when capex exceeded ₹11 crore.

The major investing outflow arose from investments in financial instruments. Net purchase of investments amounted to ₹23.04 crore compared with only ₹2.16 crore in FY25. In addition, movement in other bank balances consumed ₹3.17 crore. Consequently, net cash used in investing activities stood at ₹24.97 crore. This suggests the company deployed surplus or borrowed funds into investments despite pressure on operating liquidity, which may raise concerns regarding cash allocation priorities.

Cash Flow from Financing Activities

Financing activities turned positive in FY26 and partially offset the weakness in operations and investing cash flows. The company raised significant short-term borrowings amounting to a net inflow of ₹18.11 crore, compared with repayment of ₹14.60 crore in FY25. This indicates greater dependence on working capital financing to support operations and inventory buildup.

Finance costs paid increased to ₹3.69 crore, reflecting either higher borrowing levels or increased interest rates. Long-term borrowings were largely stable, with a minor repayment of ₹0.21 crore. Dividend payout remained modest at ₹0.24 crore, showing conservative shareholder distribution amid liquidity pressures.

Overall, financing activities generated a positive cash inflow of ₹13.96 crore compared with an outflow of ₹16.56 crore in FY25. This financing support helped mitigate, but not fully offset, the large operational and investing cash deficits.

Net Cash Flow Position

The company’s total cash flow position weakened considerably during FY26. Net cash flow for the year turned negative at ₹20.99 crore versus a positive ₹18.21 crore in FY25. Consequently, closing cash and cash equivalents declined sharply to ₹1.37 crore.The most important concern in the statement is the mismatch between accounting profitability and operating cash generation. Although the company remained profitable, aggressive inventory accumulation significantly eroded operating cash flows. Increased reliance on short-term borrowings indicates that external funding was required to sustain operations and investments.

From a liquidity perspective, FY26 appears challenging. If inventory converts efficiently into sales and collections in the next period, cash flows could normalize. However, if inventory remains elevated or demand weakens further, pressure on working capital and borrowings may continue. Investors and analysts should closely monitor inventory turnover, debt levels, and operating cash conversion in upcoming quarters.