I’m no expert but here is my understanding.
We can see that the company purchased investment worth 463 Cr and sold investments worth 446 Cr within the same financial year. So I think these are short term investments.
These are labeled as current investments in the cash flow statement.
We notice while reading the Notes to the financial statements in the Annual Report, the details of the current investments are provided but the amount of investments purchased/sold does not match the amount in the cash flow statement.
If we calculate investments purchased – investments sold, 463-446 = 17 Cr, it roughly matches the 175 Million amount mentioned in the notes. So here, they are probably reporting only the investments held at the end of financial year after all the buy/sell transactions and not the details of all the investments bought and sold during the year.
So, most probably they bought/sold lot of mutual fund units throughout the year which is reflected in the cash flow statement.
On the question about why they are doing it, they are probably just parking the working capital/ reserves in liquid funds till they find a use for it like paying bills, suppliers etc.
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