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’s operating cash flow remains strong, though it has slightly moderated compared to the previous year. Net cash from operating activities stood at ₹1,368.06 crore in FY26 versus ₹1,424.46 crore in FY25, indicating a small decline despite higher reported profit before tax (₹285.47 crore vs ₹191.15 crore). This suggests that earnings quality is being influenced by working capital movements and non-cash adjustments rather than pure cash generation. A major driver of operating cash flow is the large loan book movement, where loans increased significantly (₹1,690.74 crore outflow in FY26), partially offset by improvements in other financial assets and liabilities. The business continues to show strong interest income generation, but this is largely balanced by equally large interest payouts, reflecting its leveraged lending model. Impairment charges and provisions have also increased, hinting at slightly higher credit stress or conservative provisioning. Overall, operating cash flow remains robust and comfortably positive, but the slight dip year-on-year suggests tightening margins and heavy reinvestment into lending assets, which is typical for a growing NBFC but worth monitoring for efficiency and credit quality trends.

Cash Flow from Investing Activities

Investing activities show a shift from a positive inflow in FY25 (₹52.04 crore) to an outflow in FY26 (₹89.25 crore), indicating increased capital deployment into long-term assets. The primary contributors to this outflow are higher purchases of property, plant, and equipment (₹14.77 crore) and investments measured at cost (₹74.53 crore outflow in FY26 compared to an inflow in FY25).

The company also made modest investments in intangible assets and continued small-scale capital expenditure, suggesting incremental expansion rather than large-scale asset creation. Partial proceeds from sale of PPE and investment property provided limited offset, but not enough to neutralize the overall investment outflow. This pattern reflects a more expansionary stance compared to the previous year, with capital being deployed into both operational infrastructure and strategic investments. While not aggressive, it indicates a gradual buildup of productive and financial assets.

Cash Flow from Financing Activities

Financing cash flows remain the strongest contributor to liquidity, increasing slightly to ₹1,552.12 crore in FY26 from ₹1,573.56 crore in FY25. The company raised significant external funding through borrowings and debt securities, alongside a notable equity infusion of ₹749.81 crore from share capital issuance, which materially strengthened the balance sheet. Borrowing activity continues to dominate, with substantial inflows from borrowings other than debt securities (₹2,726.77 crore) offset by large repayments (₹2,061.91 crore), indicating active liability management rather than net over-leveraging. The issuance of debt securities also contributed positively, though repayments increased year-on-year. However, there are notable financing outflows such as share issue expenses and purchase of non-controlling interest, suggesting restructuring or consolidation of ownership. Overall, financing activities clearly support business expansion and lending growth, with strong external capital dependence typical of a high-growth NBFC.

Net Increase/Decrease in Cash & Cash Equivalents

The company recorded a lower net increase in cash and cash equivalents at ₹94.81 crore in FY26 compared to ₹201.14 crore in FY25. This decline is mainly due to higher investment outflows and slightly reduced operating cash surplus. Despite strong financing inflows, the aggressive deployment into loans and investments absorbed a large portion of liquidity. The closing cash balance rose to ₹343.16 crore from ₹248.35 crore, indicating improved absolute liquidity, but the growth rate has slowed. Overall, liquidity remains adequate and stable, but the trend shows that incremental cash generation is being increasingly absorbed by business expansion and asset growth rather than accumulating on the balance sheet.