Synopsis: Despite 26–105% profit CAGR, these companies report ₹35–₹1,462 crore negative FCF over five years, driven by heavy capex, rising working capital, and delayed cash realisation.
Profitability is the core indicator of a company’s financial health, as it reflects the company’s ability to generate earnings and create value for the shareholders. However, profit alone does not tell the full story, as an equally critical metric is the free cash flow (FCF), which basically measures the actual cash a company generates after accounting for operating expenses and capital expenditure. A positive free cash flow indicates that a company has surplus cash to reinvest, reduce debt, or reward shareholders, signalling strong financial flexibility.
In contrast, a negative free cash flow means the company is spending more cash than it generates, often due to heavy investments, working capital pressures, or delayed collections. While negative FCF is not always a red flag- especially when the company is in its expansion phases. But it does raise important questions about the sustainability and quality of reported profits when it persists despite showing a strong earnings growth.
Therefore in this article, we will be exploring those stocks that have seen high profit CAGR but have also witnessed negative free cash flow for the same period of time
Incorporated in 1999 and headquartered in Haryana, Netweb Technologies India Limited is a leading Indian provider of high-end computing solutions, backed by fully integrated design and manufacturing capabilities.
The company has a 5-year profit CAGR of 96 percent but has its Free Cash Flow for the past 5 years at negative Rs 34Cr. In the latest quarter the company saw a YoY revenue growth of 21 percent, going from Rs 251 Cr in Q2FY25 to Rs 304 Cr in Q2FY26, while the QoQ went up by 1 percent from Rs 301 Cr in Q1FY26.
The YoY Net Profits growth is at 20 percent, going from Rs 26 Cr in Q2FY25 to Rs 31 Cr in Q2FY26, while the QoQ growth stood at 3.3 percent from Rs 30 Cr in Q1FY26.
PTC Industries Limited, incorporated in 1963 and headquartered in Uttar Pradesh, is a leading manufacturer of high-precision metal components designed for critical and supercritical applications. The company caters to strategically important sectors
The company has a 5-year Profit CAGR of 105 percent,, but its Free Cash Flow is at a negative 457Cr for the past 5 years. In the latest quarter it saw a YoY revenue growth of 73 percent, going from Rs 72 Cr in Q2FY25 to Rs 125 Cr in Q2FY26, while the QoQ went up by 28 percent from Rs 97 Cr in Q1FY26.
The YoY Net Profits growth is at 5 percent, going from Rs 17 Cr in Q2FY25 to Rs 18 Cr in Q2FY26, while the QoQ growth stood at 260 percent from Rs 5 Cr in Q1FY26.
Incorporated in 1958, the company is a manufacturer and supplier of automotive solutions and systems to original equipment manufacturers (OEMs).
The company’s 5-year Profit CAGR stands at 41 percent, while its Free Cash Flow is at a negative 899 Cr. for the past 5 years. In the latest quarter Uno Minda saw a YoY revenue growth of 13.41 percent, going from Rs 4,245 Cr in Q2FY25 to Rs 4,814 Cr in Q2FY26, while the QoQ went up by 7.2 percent from Rs 4,489 Cr in Q1FY26. The YoY Net Profits growth is at 21 percent, going from Rs 266 Cr in Q2FY25 to Rs 323 Cr in Q2FY26, while the QoQ growth stood at 4.5 percent from Rs 309 Cr in Q1FY26.
This company is part of the Adani portfolio, is a multidimensional organization with a strong presence across key segments of the energy value chain, including power transmission, power distribution, smart metering solutions, and advanced cooling solutions.
Its 5 year Profit CAGR is at 26 percent, while the Free Cash Flow is at a negative 1,262 Cr. for the past 5 years. Adani Energy Solutions saw a YoY revenue growth of 6.66 percent, going from Rs 6,184 Cr in Q2FY25 to Rs 6,596 Cr in Q2FY26, while the QoQ fell by 3.2 percent from Rs 6,819 Cr in Q1FY26. The YoY Net Profits fell by 27 percent, going from Rs 773 Cr in Q2FY25 to Rs 557 Cr in Q2FY26, while the QoQ grew by 3.3 percent from Rs 539 Cr in Q1FY26.
Paras Defence and Space Technologies (PDST) is a private-sector defence company in India, primarily engaged in the design, development, manufacturing, and testing of advanced engineering products and solutions for the defence and space sectors.
Paras has a 5-year Profit CAGR of 26 percent, while its Free Cash Flow is at a negative 35 Cr. for the past 5 years. In the latest quarter the company saw a YoY revenue growth of 21 percent, going from Rs 87 Cr in Q2FY25 to Rs 106 Cr in Q2FY26, while the QoQ went up by 14 percent from Rs 93 Cr in Q1FY26.
The YoY Net Profits growth is at 46 percent, going from Rs 13 Cr in Q2FY25 to Rs 19 Cr in Q2FY26, while the QoQ growth stood at 35 percent from Rs 14 Cr in Q1FY26.
Incorporated in 2008, Kaynes Technology is a leading integrated electronics manufacturing services (EMS) company, offering end-to-end solutions and IoT-enabled capabilities across the design, manufacturing, and lifecycle management of electronic products.
Kaynes has a 5-year Profit CAGR of 95 percent, while its Free Cash Flow is at a negative 1462 Cr. for the past 5 years. In the latest quarter the company saw a YoY revenue growth of 58 percent, going from Rs 572 Cr in Q2FY25 to Rs 906 Cr in Q2FY26, while the QoQ went up by 34 percent from Rs 673 Cr in Q1FY26.
The YoY Net Profits growth is at 101 percent, going from Rs 60 Cr in Q2FY25 to Rs 121 Cr in Q2FY26, while the QoQ growth stood at 61 percent from Rs 75 Cr in Q1FY26.
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