Vishal Fabrics profit up 35% but cash flow evaporates on receivables surge
Operating cash flow drops to ₹2.9 cr from ₹107.6 cr; ₹121.5 cr locked in trade receivables.
— 2 earlier stories on Vishal Fabrics Ltd. →What's new
- Net profit rose 35% to ₹32.2 crore; operating cash flow crashed to ₹2.9 crore.
- Trade receivables swelled by ₹121.5 crore, locking up cash.
- Equity warrants converted, raising ₹114.75 crore and expanding equity to ₹638 crore.
Why this matters
Profit growth means little if cash isn't coming in. The ₹121.5 cr receivable build suggests customers are paying slower or sales were on credit. The ₹114.75 cr capital raise offsets some balance-sheet pressure, but working capital discipline is the real test.
What we're watching
- Whether management addresses receivable collection in the next concall.
- Q1 FY27 cash flow trend to see if receivables unwind.
- Any impact on credit rating or borrowing costs.
The full read
Vishal Fabrics reported a 35% net profit jump to ₹32.2 crore for FY26, but the quality of earnings is questionable. Operating cash flow all but dried up to ₹2.9 crore from ₹107.6 crore, as trade receivables ballooned by ₹121.5 crore. That means profits are largely on paper — cash hasn't followed. The company did raise ₹114.75 crore through warrant conversions, expanding equity to ₹638 crore, which helps the balance sheet but doesn't fix the collection problem. An unmodified audit opinion and asset revaluation gains of ₹17.1 crore add some gloss, but the cash flow statement tells a different story.
Story so far
All notes on VISHAL →- Today · 7:39 PM IST Vishal Fabrics profit up 35% but cash flow evaporates on receivables surge
- 4d ago Vishal Fabrics' profit rose 35%. Its cash flow crashed 97%.
- 4d ago Vishal Fabrics profit jumps 35% as cash flow all but vanishes