Arvind Ltd Management Discussions

Strength that Adapts

FY2025-26 was a defining year for global manufacturing. Businesses operated against a backdrop of heightened geopolitical uncertainty, evolving trade policies, tariff-related disruptions, volatile freight costs and uneven consumer demand across major markets. Global supply chains continued to recalibrate as companies sought greater resilience, diversification and flexibility, while customers increasingly prioritised partners capable of delivering reliability alongside innovation.

For the textile and apparel industry, these developments reinforced a fundamental shift. Competitive advantage was no longer determined solely by manufacturing scale or cost efficiency. It increasingly depended on the ability to adapt—responding quickly to changing customer requirements, optimising operations, strengthening supply-chain resilience and allocating capital with discipline.

Against this backdrop, Arvind delivered one of its strongest operating performances. The Company achieved record consolidated revenue of _9,303 Crore and EBITDA of _1,061 Crore, while improving margins, strengthening free cash generation and reducing net debt despite a challenging external environment. Volume growth remained robust across core textile businesses, with denim production reaching 60 million metres, woven fabrics recording an all-time high of 136 million metres, garmenting volumes increasing to 42 million pieces, and Advanced Materials continuing its planned growth trajectory. During the year, Arvind also strengthened its long-term strategic position through the acquisition of Dalco-GFT in the United States, expanding the global footprint of its Advanced Materials business. These outcomes were not driven by favourable market conditions. They reflected the resilience of Arvinds integrated business model, disciplined execution, diversified customer portfolio, continued investments in manufacturing capability and technology, and an unwavering focus on operational excellence.

The Companys performance during FY2025-26 demonstrates that resilience is not simply the ability to withstand disruption; it is the ability to emerge stronger from it. As global markets continue to evolve, Arvind remains focused on strengthening its competitive position through innovation, sustainability, manufacturing excellence and prudent capital allocation, while creating long-term value for all stakeholders.

Global Economic Environment

During 2025–26, the global economy demonstrated relative resilience, maintaining stability despite continued economic uncertainties, geopolitical tensions, and evolving policy environments. According to the International Monetary Fund in its World Economic Outlook, global GDP growth remained around 3.3% in 2025, with a modest moderation projected to approximately 3.1% in 2026.

However, the growth landscape remained uneven. Advanced economies experienced slower expansion due to persistent inflationary pressures, tighter monetary policies, and subdued consumer demand. In contrast, emerging and developing economies—particularly across Asia, continued to act as key growth drivers, supported by domestic consumption, improving trade activity, and relatively stable financial conditions.

The year was marked by ongoing geopolitical conflicts, including the Russia-Ukraine War and tensions in the Middle East, which intermittently disrupted global supply chains, logistics routes, and energy markets. Additionally, trade realignments, currency volatility, and cautious investment sentiment influenced global economic activity. Despite these challenges, easing inflation in several regions and gradual normalisation of supply chains provided a supportive backdrop for steady, albeit moderate, global growth.

Indian Economy

Indias real Gross Domestic Product (GDP) projected a growth of 7.6 % in FY26, indicating sustained economic momentum despite ongoing global uncertainties. The international economic environment remains fragile, with persistent geopolitical tensions, conflicts, and volatile trade policies continuing to pose significant challenges. On the domestic front, retail inflation has moderated, easing from 3.4% in FY26 to 4.3% has been projected for FY27, signalling improved price stability. Reflecting Indias expanding role in the global economy, India now holds the seventh-largest share in global services exports. The Union Budget 2025–26 unveils a range of bold reforms and targeted initiatives focused on strengthening Indias textile sector, MSMEs, exports, and agriculture. It also introduces tax relief measures designed to boost disposable income and drive overall economic growth. Real GDP growth for FY27 is projected at 6.8-7.2 per cent.

Tariff Impact Analysis

The year opened with immediate disruption. On April 2, 2025, the United States imposed a 10% reciprocal tariff on Indian goods, which swiftly escalated to 26% within days. While Indian textiles, particularly apparel and garments, faced order uncertainty, the period was paradoxically characterised by a surge in export volumes as US retailers and importers aggressively frontloaded orders to beat higher duties. Q2FY26 witnessed the most severe escalation. The US tariff on Indian goods rose to 25% on August 7, 2025, and reached 50% by August 28, 2025, placing Indian exporters at a material disadvantage compared to Bangladesh (20%) and Vietnam (20%). Q3FY26 brought gradual stabilisation as diplomatic channels between India and the US intensified. While the 50% tariff remained in force through this quarter. The governments refusal to impose retaliatory tariffs while actively pursuing WTO consultations and a bilateral trade framework helped de-escalate trade tensions. Demand shifted meaningfully towards the UK and European markets, where Indian exporters found growing appetite following the conclusion of the India-UK FTA in May 2025.

The US tariff regime accelerated the ‘China-plus-one and ‘Bangladesh-plus-one sourcing strategies pursued by global brands. While Bangladesh and Vietnam initially benefited from lower tariff differentials versus India (20% vs. Indias 50% peak), the subsequent India-US trade deal (18%) and India-UK FTA meaningfully narrowed this gap and in some product categories reversed the disadvantage.

Highlights on FTA Agreements:

Indias FTA agenda witnessed exceptional progress during FY2025–26. Key developments include:

• India-UK Comprehensive Economic and Trade Agreement (CETA) — concluded May 6, 2025, eliminating tariffs on 99% of Indian exports to the UK, including textiles, garments, leather, and footwear. This provides Indian exporters with an approximately 10% cost advantage over regional competitors in the UK market.

• India-US Interim Trade Framework — Announced February 2, 2026, reducing US tariffs on Indian goods from a peak of 50% to 18%. Textiles, ready-made garments, and carpets are among the primary beneficiaries. The deal unlocks access to a USD ~114 billion addressable US market.

• India-EU FTA (In Advanced Stages) — If concluded, this agreement could render 70–75% of Indias textile exports effectively duty-free globally, transforming the long-term demand-supply equation for Indian manufacturers.

Indian Textile and Apparel Industry

The textile industry contributes approximately 2.5% to the national GDP, around 13% to industrial output, and nearly 12% of the countrys total export earnings. It is also one of the largest employment-generating sectors, providing livelihoods to over 45 million people, both directly and indirectly, across the entire value chain — from cotton cultivation and yarn production to garment manufacturing and retail. With the global apparel market expected to reach USD 2.37 trillion by 2030, a CAGR of 8%, and the global textile and apparel trade projected to grow around USD 1.8 trillion, opportunities for international expansion are set to increase. Domestically, the Indian Textile and Apparel Market is anticipated to grow at a strong CAGR of 10%, reaching USD 350 billion by 2030, offering a significant boost to companies with global ambitions. Additionally, the technical textiles sector is poised for substantial expansion, with the global market projected to hit USD 300 billion by 2047. For companies in the textile industry, this growth trajectory highlights an ideal environment for scaling operations, diversifying product lines, and tapping into both traditional and emerging high-margin markets.

• Strategic Rationale and Opportunity

• Global Manufacturing Footprint — Bangladesh, Egypt, UAE & Beyond

Strategic Context: The ‘Investment-Light Global Expansion Model

Arvind Limited has adopted a deliberate investment-light global manufacturing and sourcing strategy designed to capture the supply chain diversification opportunity created by shifting global trade dynamics, US tariff volatility, and growing buyer demand for geographically diversified sourcing. Rather than deploying large proprietary capital across offshore locations, the Company is pursuing a partnership-led model — building manufacturing alliances, joint venture arrangements, and sourcing partnerships in key geographies while focusing its own capital investment on India-based capacity expansion, technology, and advanced materials.

Bangladesh — Denim and Fashion Textiles Partnership

Arvind Limited has a long-standing strategic presence in Bangladesh through its denim manufacturing operations. The Company has established a denim plant in Bangladesh in 2010 in a joint venture arrangement. Bangladesh, as the worlds second-largest apparel exporter after China, provides unique advantages:

• Duty-free or preferential access to the EU, UK, and other developed markets

• Significantly lower labour cost structure relative to India

• Established buyer relationships with global fast-fashion and value retailers

• Proximity to Indias upstream spinning and fabric supply chain In FY2025–26, Arvind has further expanded its Bangladesh partnerships, specifically in denim and fashion textiles manufacturing, as part of its wider global sourcing strategy. These partnerships allow Arvind to serve buyers requiring Bangladesh-origin goods (particularly for EU/UK market access) while maintaining the design, quality, and fabric innovation advantage that comes from its Indian vertically integrated operations.

Egypt — Strategic Gateway to EMENA Markets

Egypts strategic position at the confluence of Africa, the Middle East, and Europe makes it an increasingly important node in global apparel sourcing. Egypt offers a compelling combination of competitive labour costs, a meaningful cotton-growing tradition (long-staple Egyptian cotton), proximity to European markets, and a network of trade agreements including the EU-Egypt Association Agreement and the AGADIR Agreement.

Arvind has expanded its partnerships in Egypt, particularly in denim and fashion textiles manufacturing, as part of its broader international strategy. Egypt serves multiple objectives:

• Provides preferential tariff access to the EU market (0% duty under EU-Egypt trade framework for qualifying products)

• Enables proximity-based supply chain benefits for European brands and retailers seeking shorter lead times

• Serves as a platform to access the growing MENA apparel market.

UAE — Arvind Atelier FZC and London Design Hub

In May 2026, Arvind Limited launched Arvind Atelier FZC, a wholly owned UAE subsidiary based in the Sharjah Airport International Free Zone (SAIF Zone), alongside a dedicated Design Hub in London. This dual announcement represents a significant step in building a customer-centric global commercial infrastructure:

• Arvind Atelier FZC (UAE): Provides a regional hub for sourcing, design, and commercial engagement across the MENA and Europe markets; leverages the UAEs world-class logistics infrastructure and its status as a gateway to both Gulf and African markets

• London Design Hub: Directly positioned to capitalise on the India-UK FTA implementation, showcasing Arvinds complete garment collection to European buyers and strengthening engagement with UK and EU brands seeking alternative sourcing from India.

The London presence is particularly timely given that demand from UK and European buyers is reported to be exceeding Arvinds current supply capacity, creating immediate commercial opportunity from Day 1 of operations.

Entry into the Worlds Largest Technical Textiles Market

Through Dalco-GFT, AAML secures a manufacturing base within the US, effectively creating a ‘Made in USA positioning that eliminates tariff exposure and aligns with domestic content preferences across key customer segments such as automotive OEMs and infrastructure contractors. The acquisition provides access to an addressable market estimated at USD 2.5 billion across industrial applications, filtration, mobility, and protective material.

Outlook on Raw Material

As of April 2026, cotton prices have seen an increase since the beginning of the year, which could potentially increase input cost. However, market projections indicate a phase of stability ahead, with prices expected to be range bound throughout the year. This anticipated steadiness is largely due to improved balance in global supply and demand, alongside a more stable macroeconomic outlook. The season began with cautious estimates but was progressively revised upward. The Cotton Association of Indias (CAI) first estimate for FY 2025-26 projected cotton production at 305 lakh bales of 170 kg each, a decline of 2.42% from 312.4 lakh bales in FY 2024-25, primarily attributable to reduced acreage and late rains in key growing regions.

The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, approved an increase in the Minimum Support Price (MSP) for cotton by up to 11.84% for the 2025-26 season, with medium-staple cotton at approximately. _7,700 per quintal and long-staple cotton at approximately _8,100 per quintal.

In historical context, cotton MSP, which stood at approximately _3,700 per quintal in 2013-14, has been raised to _7,700 per quintal for 2025-26 — an increase of approximately. 108% over twelve years.

The cascading effect of MSP-led price increases has been severe on the textile manufacturing value chain textile mills faced mounting cost pressures due to the sharp increase in raw cotton prices.

Indias textile industry is witnessing a strategic shift towards man-made fibres (MMF), aligning with global consumption trends where MMFs constitute approximately 77% of fibre usage. The Government of India extended the deadline for fresh applications under the PLI Scheme for Textiles to 31 March 2026. In the Union Budget 2026–27, it also announced the National Fibre Scheme to strengthen self-reliance across natural, man-made, and new-age fibres and reduce import dependence.

However, the MMF sector faces challenges such as fragmentation and higher logistical costs due to a lack of vertical integration. Policy efforts are underway to build integrated fibre-to-fashion value chains to improve competitiveness and capture growing global demand for MMF-based textiles

Government initiatives

The exemption of import duty on shuttle-less looms—specifically Rapier Looms and Air Jet Looms is a highly advantageous move for textile companies in India. By reducing the duty from 7.5% to nil, the cost of acquiring advanced, high-performance looms significantly decreases, making it more feasible for manufacturers to invest in modern machinery. This policy directly supports the modernisation and capacity expansion of the weaving sector, enabling improved fabric quality, higher productivity, and enhanced global competitiveness. Additionally, the focus on promoting technical textiles such as agro-textiles, medical textiles, and geo-textiles opens up high-margin, growth-oriented segments for companies to explore. Some of these segments are being tapped through our advanced material business (AAML). This aligns well with the governments ‘Make in India vision, fostering domestic manufacturing and reducing dependency on imports, while empowering Indian textile companies to scale operations and cater to emerging global markets.

The increase in Basic Customs Duty on knitted fabrics—from "10% or 20%" to "20% or _115 per kg, whichever is higher"—is a beneficial move for the Indian textile industry, particularly for domestic manufacturers like Arvind Ltd. This higher duty acts as a protective measure against the influx of low-cost imports, especially from countries with subsidised textile sectors. By making imported knitted fabrics more expensive, it levels the playing field for Indian producers, allowing companies like Arvind to compete more effectively on price in the domestic market. This not only helps protect market share but also encourages greater capacity utilisation and potentially stimulates investment in domestic production of high-quality knitted fabrics.

Opportunities and Threats Opportunities

• Indias expanding domestic market, fuelled by a growing middle class, e-commerce growth, and Gen Z consumption trends, is driving strong demand.

• Government initiatives like PM MITRA Parks, the PLI Scheme, and RoSCTL are boosting investment and expansion in the textile sector.

• The recent approval of new applications under Round III of the Production Linked Incentive (PLI) Scheme for Textiles which include 19 applications for MMF Fabrics,5 for MMF Apparel and 18 for Technical Textile.

• Recent Free Trade Agreement between India and New Zealand will offer 100% duty free access for Indian textiles and garments which will allow duty free access to high value market, bolstering Indias 2030 goal of $350 billion textile industry.

• Indias growing emphasis on textile recycling and the circular economy offers a chance to promote sustainable manufacturing and generate green jobs.

• The UK imports USD 20 billion in textiles, with India holding a 5% share. The FTA strengthens Indias position against Bangladesh and Vietnam.

Threats

• Indias export competitiveness remains low, trailing China, Vietnam, and Bangladesh due to high production costs, lower labour efficiency, fragmented supply chains, and weak vertical integration.

• India faces supply chain and cost challenges, with a fragmented cotton supply raising logistics costs and high raw material prices making man-made fibres like polyester and viscose costlier than in China.

• Complex regulations and trade barriers, including burdensome export procedures, disadvantage India against competitors like Vietnam in major markets.

• Rising sustainability norms, led by global brands and strict EU regulations, challenge Indian MSMEs, especially in meeting demands for green sourcing, renewable energy, and recycling.

• Fast fashion and rising textile waste pose growing concerns, with Indias recycling market still small despite expected growth amid global waste projections for 2030.

• Labour issues like increasing minimum wages, high attrition and migrant worker challenges cause workforce instability, with shortages in textile hubs and underutilised surplus in other states.

• Sustainability compliance costs are rising as global regulations demand stricter environmental and labour standards, increasing production expenses.

Particulars	March 31, 2026 Amount	For the Year Ended % of Sales	March 31,2025 Amount	% of Sales
Revenue from Operations	9,303		8,329
Other Income	56		65
Total Revenue	9,360		8,394
Cost of Material Consumed	4,295	45%	3,730	45%
Purchase of Stock in Trade	195	3%	387	5%
Change in inventory	5	0%	-154	-2%
Project Expenses	117	1%	72	1%
Employee Cost	1,203	13%	1,056	13%
Other Expenses	2,484	27%	2,384	29%
EBIDTA	1,061	11%	919	11%
EBITDA w/o Other Income	1,004	11%	853	10%
Depreciation	290		259
Finance Cost	165		166
Share of Profit/(loss) of Joint Venture	7		-1
Profit Before Exception Items and Tax	612	7%	493	6%
Exceptional Item	-17		-0
Profit before Tax	595	6%	493	6%
Tax	168		125
Profit after Tax	427	5%	367	4%
Profit from Discontinuing Operations	-
Minority Interest	13		14
Profit Attributable to Equity holders of the Parent	414	5%	353	4%

Consolidated revenue for FY26 grew 12% & crossed a record _9300 Crores All-round margin improvement across segments drove overall margins to 11.4% (up 37 bps), supported by efficiency improvements and productivity gains.

Results review

For the full year, consolidated revenues of the Company stood at _9,303 Crores which was higher by 12% compared to last year. EBITDA (including other income) increased by around 15% levels (Rs 1061 Crores as compared to Rs 919 Crores in FY25). Profit after tax, minority interest and exceptional items stood at a robust Rs 414 Crores (353 Crores in FY25).

Revenues

Overall revenues grew by 12% and stood at _9,303 Crores. Textile revenues were higher by 12% and reached _6897 Crores. Garments volumes showed a steady growth of 12%. Woven volumes remained strong. Denim volumes reached ~60 Mn metres levels. Advanced Materials steadily delivered strong performance through the quarters as its full year revenues grew by 19% and closed the year at _1,839 Crores.

Cost of Goods Sold

For the Textile businesses, cotton prices have remained stable. Dyes and Chemicals, especially those linked to freight also started to soften in the second half of the financial year. However, for AMD, prices of specialty yarns, glass rovings, resin systems and chemicals remained range bound throughout the year.

Operating Margin

On a full year basis, the EBITDA margins (including other income) stood at 11.4% compared to 11 % in FY25. In absolute terms, EBITDA (including other income) stood at _1,061 Crores compared to _919 Crores in the previous year. Finance Cost: Interest outgo for the year stood at _165 Crores compared to _166 Crores for the previous year. Depreciation: Depreciation for the year stood at _290 Crores compared to _259 Crores in the previous year. Profit Before Taxes: PBT for the full year stood at _606 Crores, compared to _494 Crores in FY25.

Net Profit: Profit after taxes, exceptional items, minority interest and discounting operations stood at _414 Crores for FY26, as compared to _353 Crores for FY25.

Net Working Capital (NWC): NWC as of 31st March 2026 stood at _1525 Crores which was equivalent to 6 turns of FY26 revenues, FY25 NWC stood at _1,380 Crores.

Debt: Net debt reduced by _112 Crore during the year and stood at _1172 Crore on account of better free cash generation.

Key financial ratios

S. No	Particulars	2025-2026	2024-2025	Change(%)
1	Debators Turnover Ratio	7.1	7.4	-4%
2	Inventory Turnover Ratio	4.3	4.0	7%
3	Current Ratio	1.3	1.6	-18%
4	Debt Equity Ratio	0.26	0.34	-23%
5	Interest Coverage Ratio	4.67	3.98	17%
6	Net Profit Margin	4.4%	4.2%	5%
7	Operating Profit Margin	8.3%	7.9%	5%
8	Return on Net Worth#	11.0%	9.6%	14%

Segment wise or product-wise performance Woven

Woven segment revenue was higher by 9% from _2,611 Crores in FY25 to _2,833 Crores in FY26. Volumes grew from 128 million metres to 135.8 million [59% export] in FY2026. Average price realisation for Woven products increase to _207 per metre in Q1 and gradually fell to close the Q4 FY26 at _202 per metre.

Denim

During the financial year, the Denim fabrics business clocked _1,459 Crores against _1,279 Crores in the previous year. In termsofvolumes,thefullyeartallystoodat59.5millionmetres compared to 51.6 million metres in FY25. The proportion of exports reached 67%. Multiple factors are driving this increase in Denim volumes. Arvinds verticalisation strategy is yielding measurable outcomes, with a growing proportion of fabric volumes being converted into garments. This has been achieved through the successful transformation of select fabric customers into vertically integrated customers. The trend is supported by evolving sourcing strategies at customers end, including diversification of vendor bases and an increasing preference for integrated, one-stop solutions to optimise cost, lead time, and supply chain efficiency. Price realisation for Q4 of Denim is 243 per metre.

Garments

Revenues from the garmenting part of our textiles business increased from _1,699 Crores in FY25 to _2020 Crores in FY26, this is on account of higher demand in knitwear & Denim. Overall garmenting volumes for full garments (not counting the small SMV essential products) stood at 41.6 Mn pieces across our facilities located in Karnataka, Ranchi and Ahmedabad area. This grew by 12% from 37.2 Mn in FY25 volumes.

FY26 marked another year of continuing growth in the Advanced Materials Division (AMD) business. Revenue from the segment stood at _1,839 Crores which was 19% higher than _1,544 Crores clocked for FY25. All three clusters of AMD namely, Human Protection, Industrials and Composites delivered healthy growth.

S. No	Particulars	2025-2026	2024-2025
1	Revenue from Operations	_9,303 Crores	_8,329 Crores
2	EBITDA	_1,061 Crores	_919 Crores
3	Profit After Tax	_444 Crores	_367 Crores
4	Net Debt	_1,172 Crores	_1,284 Crores
5	ROCE	13.8 %	12.6 %

Outlook

The global trade environment remains uncertain amid multiple disruptions; however, demand for Textiles and Advanced Materials continues to remain resilient, with major sourcing destinations largely stable. The current order book is at healthy levels, supported by a robust inquiry pipeline for the upcoming season, basis this, the Company expects to grow at double digits backed by a high double-digit growth in Advanced Materials and mid-teen growth in Garments.

Not wit hstanding this outlook, the Company remains mindful of potential demand volatility in the second half of the year, driven by elevated inflationary pressures and ongoing global uncertainties, which may impact discretionary consumption across markets.

Input costs across product lines have seen a sharp increase, which could exert pressure on margins in the first half of the year. Margin recovery is expected in H2, subject to easing of geopolitical tensions.

Risks and Concerns

The Company has a robust Enterprise Risk Management framework for timely and effective identification, assessment, and mitigation of key business and operational risks. The key risks and their corresponding mitigation measures are described below:

Raw Material Risk:

The volatility in prices of raw materials such as cotton, specialty fibres and yarns, glass roving, specialty chemicals, and resins increases the input costs which adversely impact the Companys profitability. Further, many raw materials used in AMD correlate with crude oil prices and volatility in crude oil prices may weaken AMD margins.

The Company monitors price fluctuations and follows inventory management and responsive procurement policy to ensure timely procurement of raw materials at competitive prices. It also engages in contracts with clients and tries to pass on variations in the prices of raw materials to them to protect margins.

Economic Risk:

The geopolitical turmoil, global economic slowdown, high inflation and the threat of a looming recession in key markets like the US and Europe have led to a slowdown in the export market. Demand compression could reduce the Companys export business. The macroeconomic environment in the US/EU markets has started to improve though the export demand continues to remain uncertain. However, the domestic market will continue to provide sizable business opportunities for the Company.

Exchange Rate Volatility Risk:

Since a significant portion of the Companys revenue is in foreign currency and a major part of the costs are in Indian Rupees, any movement in currency rates would impact the Companys performance. Exposures on foreign currency sales are managed through the Companys hedging policy, which is reviewed periodically to ensure that the results from fluctuating currency exchange rates are appropriately managed. The Company strives to achieve asset liability offset of foreign currency exposures and only the net position is hedged. The Company also uses forward contracts and foreign exchange options towards hedging risk resulting from changes and fluctuations in foreign currency exchange rates.

Logistics Risk:

The ongoing Russia-Ukraine war has adversely impacted the global supply chain network. Since majority of the Companys business is export-oriented and depends on the supply chain for exporting final products, any kind of disruptions in the supply chain, rising container shipping costs, availability and delays pose severe challenges for the business. Further, inadequate and inefficient logistics in India lead to delays and high costs of logistics. The Company has strengthened its supply chain network and developed strong relationships with suppliers and vendors for smooth operations.

Risk of Continuing Losses in Few Subsidiaries:

Some of the Companys subsidiaries are yet to become profitable, while others have not demonstrated consistent year-on-year improvements in their bottom lines. Their subdued performance has negatively impacted the Companys overall consolidated profits. Toaddressthis,theCompanyhasdevisedaplantorationalize capital allocation among the underperforming subsidiaries. This strategy is expected to enhance profitability and returns at the consolidated entity level.

Disaster Risk:

The Company is susceptible to disasters and crises such as pandemics, earthquakes, geopolitical instability, fire hazards, etc. which may cause operational disruptions, shutdowns or production cuts, project delays, supply chain hurdles, and increased construction costs. The Company prioritizes the safety of its stakeholder community and ensures business survival during unpredictable crises. It has a well-designed safety management policy that eliminates/ reduces the risk of workplace incidents. Its proper implementation and updates enable effective prevention besides equipping the employees to handle unforeseen incidents. To reduce exposure to fire-related hazards, it has placed pressurized fire protection and related systems at strategic locations to deal with fire-related incidents.

Technology Risk:

There is a constant requirement for technology upgradation and regular R&D to enhance efficiency and productivity. Failure to use the latest and sustainable technologies to cater to the changing requirements of the global market may lead to loss of business.

The Company gives utmost importance to technology and proactively invests in R&D, modern and sustainable technologies, machinery and equipment for improving the manufacturing process, and quality and strengthening its product portfolio to cater to emerging market trends. While the medium-term future looks more certain than ever, the near-term headwinds persist on multiple counts.

Geopolitical Risk

Geopolitical risks remain elevated amid two ongoing conflicts, and prolonged high interest rates, contributing to deflationary pressures and volatile consumer demand. While global trade has shown resilience over the past twelve months, the Company remains watchful and prepared to take timely mitigating actions.

Human Resources / Industrial Relations

The Company considers its employees as the most important asset and integral to its competitive position. It has a well-designed HR policy that promotes a conducive work environment, inclusive growth, equal opportunities, and competitiveness and aligns employees goals with the organisations growth vision. Its human resource division plays a crucial role in nurturing a strong and talented workforce. It provides opportunities for professional and personal development and implements comprehensive employee engagement and development programmes to enhance the productivity and skills of its employees. The Companys employee strength stood at 3,733 as on March 31 2026. Further, industry relations remained peaceful and harmonious during the year.

Internal Control Systems and Their Adequacy

The Company maintains an efficient internal control system commensurate with the size, nature and complexity of its business. The internal control system is responsible for addressing the evolving risks in the business, reliability of financial information, timely reporting of operational and financial transactions, safeguarding of assets and stringent adherence to the applicable laws and regulations. The internal auditors of the Company are responsible for regular monitoring and review of these controls. The Audit Committee periodically reviews the audit reports and ensures correction of any variance, as may be required. Key observations are communicated to the management who undertakes prompt corrective actions.