IKF Finance Limited Annual Reports, Balance Sheet and Financials

IKF Finance Limited Consolidated Balance Sheet (Rs. in Crores)

IKF Finance Limited Consolidated Profit & Loss Statement (Rs in Crores)

IKF Finance 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

IKF Finance Limited reported a strong increase in profitability during FY2025-26, with profit before tax rising to ₹285.47 crore from ₹191.15 crore in FY2024-25. However, despite the improvement in earnings, operating cash flows remained significantly negative at ₹1,368.06 crore compared to an outflow of ₹1,424.46 crore in the previous year. The primary reason for the negative operating cash flow was the substantial growth in the loan book, reflected in a ₹1,690.74 crore increase in loans, which consumed a large amount of cash as the company expanded its lending operations. Non-cash adjustments such as impairment on financial instruments increased to ₹93.94 crore, while interest expenses rose to ₹529.36 crore. The company also benefited from higher interest income and interest receipts, consistent with the growth in earning assets. Working capital movements were mixed, with improvements in bank balances, non-financial assets, and other financial assets partially offsetting cash absorption from loan growth. After accounting for tax payments of ₹54.74 crore, the company recorded a net operating cash outflow, although the marginal improvement compared to the previous year suggests better cash generation relative to the scale of business expansion.

Cash Flow from Investing Activities

Net cash used in investing activities amounted to ₹89.25 crore during FY2025-26, compared with a net inflow of ₹52.04 crore in FY2024-25. The shift from inflow to outflow was primarily driven by investments measured at cost, resulting in a cash outflow of ₹74.53 crore, whereas the previous year had witnessed a net inflow of ₹110.56 crore from such investments. Capital expenditure was significantly lower during the year, with purchases of property, plant and equipment declining to ₹14.77 crore from ₹58.63 crore, indicating a moderation in infrastructure and asset expansion. The company also incurred modest expenditure on intangible assets of ₹0.65 crore. Small inflows were generated from the sale of property, plant and equipment and investment property. Overall, investing activities reflected a strategic allocation of funds toward long-term investments while maintaining relatively controlled capital expenditure.

Cash Flow from Financing Activities

Financing activities remained the primary source of liquidity for the company, generating a net cash inflow of ₹1,552.12 crore during FY2025-26, compared to ₹1,573.56 crore in the previous year. A major highlight was the successful equity capital raise of ₹749.81 crore, which strengthened the company’s capital base and supported future growth. The company also raised ₹400 crore through debt securities and ₹2,726.77 crore through other borrowings. These inflows were partly offset by repayments of debt securities amounting to ₹184.18 crore and repayments of other borrowings totaling ₹2,061.91 crore, reflecting active liability management. Additionally, the company spent ₹64.40 crore on the purchase of non-controlling interests and incurred share issue expenses of ₹11.09 crore. Lease-related principal and interest payments remained relatively insignificant. The strong financing inflows demonstrate the company’s ability to access both equity and debt markets to fund business expansion and support lending growth.

Net Increase/decrease in Cash & cash equivalents

Despite substantial cash outflows from operating and investing activities, IKF Finance Limited reported a net increase in cash and cash equivalents of ₹94.81 crore during FY2025-26. This increase was entirely supported by strong financing inflows, particularly the equity issuance and borrowings raised during the year. As a result, cash and cash equivalents increased from ₹248.35 crore at the beginning of the year to ₹343.16 crore at the end of the year. The cash flow profile indicates that the company is currently in a growth phase, where expanding the loan portfolio requires significant funding support from external sources. While negative operating cash flow is typical for a rapidly growing lending institution due to loan disbursements exceeding collections, the strengthened liquidity position and successful capital raising provide adequate support for continued business growth and financial flexibility