Kineco Annual Reports, Balance Sheet and Financials

Kineco Limited Consolidated Balance Sheet (Rs. In Lakhs)

Kineco Limited Consolidated Profit & Loss (Rs. In Lakhs)

Kineco Limited Consolidated Cash Flow Statement (Rs. In Lakhs)

Summary of the Cash Flow Statement for the years 2025 and 2024:

Cash Flow from Operating Activities

In FY 2025, Kineco’s operating cash flow dropped sharply to ₹308.47 lakhs compared to ₹5,496.55 lakhs in FY 2024. While profit before working capital changes improved significantly, a large buildup in inventories (₹3,787.34 lakhs) and a spike in trade receivables (₹2,625.79 lakhs) drained cash. Though the company benefited from higher trade payables and other financial assets, these couldn’t offset the heavy working capital requirements. This shows that while the business remained profitable, a lot of cash got stuck in day-to-day operations, mainly stock and customer dues, reducing liquidity strength from operations.

Cash Flow from Investing Activities

Kineco had very heavy investment outflows in FY 2025, totaling ₹(3,176.20) lakhs net, compared to ₹(1,891.29) lakhs in FY 2024. Major cash went into purchasing PPE and intangibles (₹3,117.15 lakhs) and strategic acquisitions, like buying a stake in an associate (₹824.55 lakhs), acquiring a subsidiary (₹2,166.02 lakhs), and investing in Semvac A/S shares (₹3,030.75 lakhs). However, these outflows were partially offset by cash inflows from the merger (₹3,143.05 lakhs) and Semvac’s acquisition (₹2,786.64 lakhs). The pattern shows Kineco is in an aggressive expansion phase, deploying heavy funds into growth and acquisitions, which depresses short-term cash but could fuel long-term growth.

Cash Flow from Financing Activities

On the financing side, Kineco recorded a strong inflow of ₹3,772.58 lakhs in FY 2025, up from ₹(2,795.89) lakhs outflow in FY 2024. This turnaround was mainly driven by a fresh equity issue of ₹8,799.98 lakhs, which brought in huge funds despite some equity issue costs (₹282.50 lakhs). However, the company also continued to repay long-term borrowings (₹2,551.21 lakhs) and reduced short-term debt (₹1,369.72 lakhs), while servicing interest costs of ₹824.97 lakhs. This indicates that Kineco is reducing reliance on debt and strengthening its balance sheet by shifting towards equity funding. The large equity raise suggests confidence from investors and provides a cushion for its expansion.

Net Cash Position

Overall, Kineco’s net cash position improved, with closing cash at ₹4,296.45 lakhs in FY 2025 versus ₹3,076.29 lakhs in FY 2024. Despite weaker operating cash flows and heavy investment spending, the large equity inflow ensured liquidity remained strong. The company is clearly in a scale-up mode, funding growth through external equity, but needs to keep a closer check on working capital efficiency to sustain healthy cash generation from core operations.

Kineco Limited Consolidated Financial Ratios

Summary of the financial ratio for the years 2025 and 2024

Current Ratio

The current ratio improved from 1.11 in 2024 to 1.47 in 2025, showing that Kineco’s short-term liquidity position has strengthened. This means the company now has a better buffer of current assets to meet current liabilities, though it is still not very high. The improvement likely comes from equity infusion and better working capital support, giving it more flexibility to handle near-term obligations.

Debt Service Coverage Ratio (DSCR)

The DSCR declined sharply from 1.33 in 2024 to -0.50 in 2025, which is a red flag. A negative DSCR indicates that the company’s operating cash flows were insufficient to cover its debt servicing requirements during the year. This reflects the weak operating cash flow performance noted earlier, as heavy working capital absorption left less cash to meet debt commitments.

Inventory Turnover Ratio

Inventory turnover fell from 2.48 times in 2024 to 1.84 times in 2025, meaning Kineco is taking longer to convert inventory into sales. Slower inventory movement suggests stock buildup, possibly due to expansion, slower demand, or inefficiencies in supply chain management. This ties in with the high working capital drain seen in the cash flow statement.

Trade Payable Turnover Ratio

The trade payable turnover increased from 2.10 in 2024 to 2.60 in 2025, showing that the company is paying its suppliers faster than before. While this strengthens supplier relationships, it also puts pressure on cash flow. Ideally, Kineco should balance between timely payments and optimizing cash by stretching credit where feasible.

Net Profit Ratio

The net profit ratio inched up from 4% in 2024 to 5% in 2025, reflecting a modest improvement in profitability. This means that for every ₹100 in revenue, the company earned ₹5 as profit after all expenses. Though the improvement is positive, the margin remains relatively thin, highlighting that cost efficiency and pricing power need further strengthening.

Return on Investment (ROI)

ROI rose slightly from 3% in 2024 to 4% in 2025. This shows that the company is earning a bit more on its overall investments, but the returns are still quite low compared to the capital employed. With such heavy investments in subsidiaries and acquisitions, Kineco will need time before these start generating strong returns.

Debt-Equity Ratio

The debt-equity ratio dropped dramatically from 2.32 in 2024 to 0.51 in 2025. This is a major positive development, as it indicates Kineco has reduced its reliance on debt and shifted towards a more equity-funded capital structure. The fresh equity infusion during the year has significantly strengthened the balance sheet and reduced financial risk.

Trade Receivable Turnover Ratio

This ratio improved from 1.93 times in 2024 to 2.38 times in 2025, showing that the company is collecting its dues from customers faster than before. Stronger receivables management improves cash flow and reduces credit risk. However, the improvement must be weighed against the fact that receivables in absolute terms still increased heavily in 2025.

Net Capital Turnover Ratio

The net capital turnover ratio declined sharply from 9.77 times in 2024 to 2.96 times in 2025. This means that Kineco is generating much less revenue per rupee of working capital employed. The drop indicates inefficient use of capital, likely due to higher inventory buildup and receivables, which locked up funds without generating proportionate sales.

Return on Capital Employed (ROCE)

ROCE fell from 15% in 2024 to 8% in 2025, indicating a weaker return from the total capital employed in the business. This reflects that although capital has increased significantly through equity infusion and retained funds, the profitability generated from this capital has not kept pace. It shows under-utilisation of capital and lower efficiency in generating returns.