GFCL EV Products Annual Reports, Balance Sheet and Financials

GFCL EV Products Limited Consolidated Balance Sheet (Rs. in Crores)

GFCL EV Products Limited Consolidated Profit & Loss Statement (Rs in Crores)

GFCL EV Products Limited Consolidated Cash Flow Statement (Rs in Crores)

Summary of the Cash Flow Statement for the years 2026 and 2025:

Cash Flow from Operating Activities

GFCL EV Products Limited reported a significantly higher operating cash outflow of ₹177.12 crore in FY2025-26 compared with ₹110.85 crore in FY2024-25. The loss for the year widened sharply to ₹104.31 crore from ₹27.00 crore, indicating increased operating expenses and business expansion costs. While non-cash adjustments such as depreciation (₹28.98 crore), share-based payment expense (₹11.36 crore), finance costs (₹16.63 crore), and foreign exchange losses helped partially offset the accounting loss, the major pressure came from working capital requirements. Inventories increased substantially (₹100.33 crore outflow), reflecting inventory build-up to support growth, while other assets rose by ₹111.18 crore, indicating significant investments in operational assets and advances. Although trade payables increased by ₹105.11 crore, providing some supplier financing support, it was insufficient to offset the cash absorbed by inventories and other current assets. Overall, the operating cash flow indicates that the company remains in a heavy investment and scale-up phase, with operations consuming significant cash rather than generating it.

Cash Flow from Investing Activities

Investing activities resulted in a net cash outflow of ₹822.74 crore during FY2025-26, compared with ₹655.68 crore in the previous year, highlighting an aggressive capital expenditure program. The primary driver was the purchase of property, plant and equipment (PPE) amounting to ₹772.70 crore, significantly higher than ₹487.45 crore in FY2024-25, suggesting ongoing capacity expansion and infrastructure development. The company also deployed funds into current investments (₹344.98 crore) while receiving ₹295.66 crore from redemptions of investments. Interest income contributed marginally to cash inflows. The continued high level of capital expenditure demonstrates management 's focus on building manufacturing capabilities and supporting future growth, although it places substantial demands on liquidity in the near term.

Cash Flow from Financing Activities

Financing activities generated a strong cash inflow of ₹1,111.94 crore during FY2025-26, substantially higher than the ₹771.54 crore inflow recorded in FY2024-25. The company relied on multiple funding sources to support its expansion plans and operating cash deficits. Fresh equity capital raised ₹92.47 crore, while the subsidiary contributed an additional ₹1.92 crore through equity issuance. A significant portion of funding came from debt and hybrid instruments, including ₹345.00 crore of non-current borrowings, ₹287.17 crore of current borrowings, and ₹430.00 crore raised through Series A Compulsorily Convertible Preference Shares (CCPS). Finance cost payments increased to ₹43.96 crore, reflecting the growing funding base and higher leverage. The strong financing inflows demonstrate the company 's ability to attract capital; however, they also indicate a high dependence on external funding to sustain growth and meet investment requirements.

Net Increase/decrease in Cash & cash equivalents

Despite substantial cash outflows from operations and investing activities, the company reported a net increase in cash and cash equivalents of ₹112.08 crore during FY2025-26, compared with only ₹5.00 crore in FY2024-25. This improvement was entirely driven by the large financing inflows raised during the year. Consequently, cash and cash equivalents increased from ₹5.30 crore at the beginning of the year to ₹117.39 crore at year-end. While the strengthened cash position provides near-term liquidity and supports ongoing expansion projects, the sustainability of future cash balances will depend on the company 's ability to improve operating cash generation and gradually reduce reliance on external financing sources.

Overall Cash Flow Assessment

The cash flow statement reflects a company in a rapid growth and expansion stage. The business is experiencing negative operating cash flows, significant capital expenditure requirements, and increasing working capital consumption. To fund these needs, management has successfully raised substantial capital through a combination of equity, preference shares, and borrowings. While the year-end cash balance is healthy, the company 's future financial strength will depend on converting its expanding operations into positive operating cash flows and achieving profitability. Until then, the business remains dependent on external funding to support growth initiatives and capital investments.

Financial ratios of GFCL EV Products Limited.

Summary of Financial Ratios for the year 2026 and 2025.

Current Ratio

The current ratio declined significantly from 2.22 times in FY2024-25 to 1.35 times in FY2025-26. Although the ratio remains above 1, indicating that current assets are still sufficient to cover current liabilities, the sharp decline suggests increased short-term obligations and greater utilization of working capital to support business expansion. The reduction reflects the company 's aggressive growth strategy, higher trade payables, and increased borrowings, resulting in a comparatively tighter liquidity position than the previous year.

Debt to Equity Ratio

The debt-to-equity ratio increased to 0.42 times in FY2025-26, compared with a negligible or nil debt position in FY2024-25. This rise is primarily attributable to the company 's reliance on borrowings to finance capital expenditure and expansion initiatives. While the ratio remains at a moderate level and does not indicate excessive leverage, it demonstrates a shift toward debt-funded growth. The company still maintains a relatively conservative capital structure, but interest obligations are expected to increase as debt levels rise.

Return on Equity

Return on Equity deteriorated from -2.28% to -6.50%, indicating that shareholder funds generated a larger negative return during FY2025-26. The decline was mainly driven by the substantial increase in net losses during the year. Despite significant equity infusions from investors, the company has not yet reached a stage where these funds are generating adequate returns, reflecting the early-stage nature of its expansion and investment cycle.

Inventory Turnover Ratio

The inventory turnover ratio improved from 0.11 times to 0.24 times during FY2025-26. Although the ratio remains low, the improvement suggests better utilization and movement of inventory compared with the previous year. The increase may indicate rising sales volumes and enhanced operational activity. However, the low absolute turnover level also suggests that inventory holdings remain substantial relative to revenue generation, which ties up working capital and contributes to negative operating cash flows.

Trade Receivable Turnover Ratio

The trade receivable turnover ratio increased from 1.85 times to 2.38 times, reflecting improved efficiency in collecting receivables from customers. A higher turnover ratio indicates that receivables are being converted into cash more quickly, reducing collection risk and improving working capital management. This improvement is a positive sign for liquidity and suggests better credit control practices despite the company 's rapid growth.

Trade Payable Turnover Ratio

The trade payable turnover ratio decreased slightly from 1.65 times to 1.55 times. This indicates that the company is taking longer to pay its suppliers compared with the previous year. While this strategy helps preserve cash and support working capital requirements during expansion, prolonged payment cycles may increase dependence on supplier credit. The decline is consistent with the significant increase in trade payables observed in the cash flow statement.

Net Capital Turnover Ratio

The net capital turnover ratio improved substantially from 0.17 times to 0.59 times. This increase indicates that the company generated higher revenue relative to the capital employed in the business. The improvement suggests better utilization of invested funds and working capital resources. Although the ratio remains below levels typically seen in mature manufacturing businesses, the trend reflects improving operational efficiency as the company scales up its activities.

Net Profit Ratio

The net profit ratio deteriorated from -267.23% to -302.08%, indicating that losses increased at a faster pace than revenue growth. For every ₹100 of revenue generated, the company incurred a net loss of approximately ₹302 in FY2025-26 compared with ₹267 in FY2024-25. This highlights ongoing challenges in achieving operating scale, controlling costs, and reaching profitability. The ratio underscores that the company remains in an investment and growth phase rather than a profit-generation phase.

Return on Capital Employed

Return on Capital Employed declined from -1.83% to -4.62%, reflecting lower efficiency in generating earnings from the capital invested in the business. The negative ROCE indicates that operating profits remain insufficient to cover the capital employed. The deterioration was largely driven by increased losses and substantial investments in fixed assets and working capital, which have not yet translated into proportional earnings growth.

Return on Investment

Return on Investment decreased from 9.26% to 5.41% during FY2025-26. The decline suggests lower returns generated from the company 's investment portfolio and surplus funds. Although ROI remains positive, the reduction indicates that investment income and gains contributed less to overall performance compared with the previous year, reducing a source of support for the company 's earnings.