Gokak Textiles Ltd Directors Report

Dear Members,

The Board of Directors (hereinafter referred to as "the Board") hereby submits the report of the business and operations of the Company along with the Audited Financial Statements of the Company for the Financial Year (FY) ended March 31, 2025. The consolidated performance of the Company and its subsidiary has been referred to wherever required.

Financial Results and Highlights of Performance

The Companys performance, as per Indian Accounting Standards (IND AS), during the Financial Year under review is summarized as follows:

Particulars	Standalone		Consolidated
	FY 24-25	FY 23-24	FY 24-25	FY 23-24
Total Revenue From Operations and Other Income	9781.90	13462.33	10337.90	13401.41
Exceptional Income/ (Expenses) (refinancing cost & restoration expenses)	-1213.36	938.95	-1213.36	938.95
Earnings before Interest, Depreciation and Taxation (after exceptional items)	273.11	2713.44	755.98	2690.23
Interest	2956.17	2501.54	3012.18	2557.56
Profit / (Loss) after Interest and before Depreciation items and Tax	-2683.06	211.90	-2256.20	132.68
Depreciation	1897.06	1968.60	2016.80	2076.08
Profit Before Tax (PBT)	-4580.12	-1756.70	-4273.00	-1943.40
Less: Deferred Tax	0.00	0.00	0.00	0.00
Profit after tax (PAT) Owners of the Company	-4580.12	-1756.70	-4443.61	-1525.75
Profit after tax (PAT) Non-Controlling Interest	-	-	170.60	-417.65
Other Comprehensive Income	55.59	75.94	55.00	75.81
Total comprehensive income for the year attributable to:
-Owners of the Company	-4524.53	-1680.76	-4388.32	-1449.90
-Non Controlling Interest	-	-	170.32	-417.71

Note : The above figures are extracted from Standalone and Consolidated Financial Statements as per Indian Accounting Standard ("IND AS") and are prepared in accordance with the principles stated therein as prescribed by the Ministry of Corporate Affairs under section 133 of the Companies Act, 2013 ("Act") read with relevant rules issued therein.

Management Discussion & Analysis of Financial Conditions, Results of Operations and State of Company Affairs General Performance and Outlook

The financial year 2024-25 Indias textile and apparel exports rose by 6.32 per cent to $36.61 billion in FY25, driven by a 10.03 per cent growth in apparel exports. Textile exports increased 3.61 per cent. March 2025 saw a slight dip in total T&A exports.

Raw cotton imports more than doubled, while man-made and cotton-based product exports saw modest growth. Imports of raw cotton and waste surged by 103.67 per cent to $1,219 million during April–March 2025, compared to $599 million in the same period of the previous fiscal. Imports of textile yarn, fabrics, and made-ups rose by 8.69 per cent, rising from $2,278 million to $2,476 million.

Outlook 2025-26

Trade tension and high levels of policy uncertainty are expected to impact global economic activity. The global growth is projected to drop to 2.8% in 2025 and 3% in 2026 from 3.3% for both the years.

The real GDP of Indian economy is predicted to grow at 6.5 percent in 2024/25 and 2025/26, supported by robust growth in private consumption on the back of sustained macroeconomic and financial stability The textile and fashion industry plays a crucial role in Indias economy, contributing over 10% of total exports and employing more than 45 million people. With the U.S. recently announcing a new set of tariffs, their potential to impact Indias textile export is significant. However, with Indias market diversification to Europe, the Middle East, and Latin America dependency on US market would be greatly reduced. The U.K. and India are finalizing a Free Trade Agreement (FTA), potentially reducing tariffs on apparel and textile exports.

Indias economy looks on an upward trend. Projections indicate that India will be the worlds third largest economy by 2027, surpassing US$5 trillion in GDP

The India Home Textile Market size is estimated at USD 9.60 billion in 2024, and is expected to reach USD 15.36 billion by 2029, growing at a CAGR of 9.84% during the forecast period (2024-2029) Technical Textiles is another sector that is receiving a huge push from Govt. of India. National Technical Textile Mission (NTTM) that was launched in 2020 with the objective of increasing penetration level of technical textiles for 5-10% as compared to 30-70% in the developed market.

Indias technical textiles market, which was valued at US $ 29 billion in FY 2024, is expected to grow significantly because of tax cuts for textile machinery and a rise in Basic Customs Duty (BCD) on knitted fabrics in Budget 2025. Approximately 15 per cent of Indias total textile and clothing market is made up of technological textiles, which rank seventh in the world With a "India 2047- Vision and strategic roadmap for technical textiles" the Govt. of India has expressed its ambitious plans and programmes to develop India as one of the leading hubs of Technical Textiles globally and set up a robust manufacturing base in India.

Mills Division-

The cotton prices began the financial year at about 61K/Candy dropping to ~57K/Candy in early august 2025. The prices went up high again in early September 2025 to ~60K/Candy before dropping to 55K/Cany and 53K/Candy in third week of October and December 2025 respectively before closing at 53.5K/Candy by the financial year end.

The uncertainty in cotton prices had an impact on the spinning industry as purchase orders were withheld by the end users. Uncertainty in cotton prices coupled with various macro economics factors has an effect on the Textile value chain. Many spinning industry were forced to operate at partial utilisation or closed.

The company also had to operate under reduced utilisation for the year thus undertaking jobs at higher cost. The uncertainty in the market was to an extent that some of the job-work at our facility was withdrawn.

However, the company is developing new products in woven and knit garments of fibres other than cotton. The company is also putting effort for development of technical textile products starting with development of yarn. Progress in such activities is encouraging. Vertical integration into technical textiles shall be the next development plan. New and unique products are being considered to be launched under brand CAMPBELL which is registered.

Knitwear Unit-

Garment unit within the premises at Gokak Falls is manufacturing various products of Bamboo and cotton fibres i.e. towels, shawls, blankets, bedsheet etc. Both Knit and woven products are sold over e-commerce platform of the company i.e. https://gokaktrends. com/.

Advertisements over social websites to promote new products are also undertaken. Conventional sale of products to increase the presence of the brand is also under progress.

Solar Unit-

The Solar unit has an installed capacity of 40MW within the premises. The unit has generated about 68.82MUs for this fiscal with a capacity utilisation factor (CUF) of 20.4%. Power generated is sold to customers within the state of Karnataka. The unit has power purchase agreements with clients drawing power under various Discoms across the state.

The unit suffered multiple fire incidents starting Jan-25 affecting the plant generation. Repair works on the damages to panels are completed within span of less than a month. However, a material breakdown i.e transformer and invertor in Mar-25 has reduced the total installed capacity to 35MW. Transformer repair works are in progress and scheduled to arrive by first week of May-25. The spare inverter shall be utilised for restoring the capacity back to 40MW.

The unit is refinanced by IREDA with a sanction of loan up to 220 Crores.

During the year under review the Solar Division as recorded gross income of about 37.47 Crores.

Details of Subsidiary/Joint Ventures/Associate Subsidiary Company Gokak Power & Energy Limited (GPEL)

GPEL is engaged in generation of hydro-electric power and other renewable and non-renewable sources of energy. Part of power generated is utilised for captive consumption by Gokak Textiles Limited, the holding company.

During the year under review, the Company has recorded gross income of 1,178.09 lakhs (previous year 686.85 lakhs) and net profit / (loss) for the year of 70.27 lakhs (previous year (436.18) lakhs).

During the year under review GPEL generated 30.50 Million Units of electricity (previous year 15.25 Million Units were generated). Details of GPEL is set out in the statement in form AOC-I, pursuant to section 129 of the Companies Act, 2013 and is attached herewith as Annexure I to this Report.

Financial Performance

The Consolidated Financial Statements of the Company and its subsidiary are prepared in accordance with Indian Accounting Standards (IND AS) notified under Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time and other relevant provisions of the Companies Act, 2013. The Notes to Consolidated Financial Statements are disclosed and forms part of the Consolidated Financial Statements.

Segment wise performance (standalone)

Particulars	Segment Revenue
	FY 24-25	FY 23-24
Textiles	5,971.54	9,625.23
Power	3834.94	4,163.11
Others	0.00	0.00
Total	9,806.48	13,788.34
Less: inter segment revenue	-24.58	-326.01
Total Income from operations (net)	9,781.90	13,462.33

 

Particulars	Segment Results
	FY 24-25	FY 23-24
Textiles	-2,325.49	-1,386.86
Power	-2,254.63	-369.84
Others	0.00	0.00
Total segment results (PBT)	-4,580.12	-1,756.70
Add: Share of profit of joint ventures and associates accounted for using equity method	0.00	0.00
Add: Unallocated Exceptional items-Income	0.00	0.00
Add: Unallocable income/(expenses)	0.00	0.00
Profit /(Loss) from continuing activities before tax	-4,580.12	-1,756.70
Profit / (Loss) from discontinued operations	0.00	0.00
Profit /(Loss) before tax from continuing and discontinued operation	-4,580.12	-1,756.70

Segment wise performance (consolidated)

Particulars	Segment Revenue
	FY 24-25	FY 23-24
Textiles	5,971.54	9,625.23
Solar	5,013.03	4,849.96
Others	0.00	0.00
Total	10,984.57	14,475.19
Less: inter segment revenue	-646.67	-1,073.78
Total Income from operations (net)	10,337.90	13,401.41

 

Particulars	Segment Results
	FY 24-25	FY 23-24
Textiles	-2,325.50	-1,386.86
Solar	-1,947.50	-556.54
Others	0.00	0.00
Total segment results (PBT)	-4,273.00	-1,943.40
Add: Share of profit of joint ventures and associates accounted for using equity method	0.00	0.00
Add: Unallocated Exceptional items-Income	0.00	0.00
Add: Unallocable income/(expenses)	0.00	0.00
Profit /(Loss) from continuing activities before tax	-4,273.00	-1,943.40
Profit / (Loss) from discontinued operations	0.00	0.00
Profit /(Loss) before tax from continuing and discontinued operation	-4,273.00	-1,943.40

Key Financial performance, Operational Information and Ratio Analysis

Key Ratio / Indicators	March 31, 2025	March 31, 2024	Remarks [For variance more than 25%]
Current Ratio (times)	0.39	0.41	-
Inventory turnover ratio (times)	2.99	4.52	Due to significant reduction in turnover and resulting reduction in cost of good sold.
Trade receivables turnover ratio (times)	9.94	13.16	-
Trade payable turnover ratio (times)	1.73	2.88	Due to significant reduction in purchases.
Net profit ratio (%)	-37.51%	-21.15%	Due to increase in losses and reduction in turnover.
Debt-equity ratio (times)	-67.10	7.00	Due to significant reduction in equity and increase in debts
Debt service coverage ratio (times)	-0.12	-0.18	Due to increase in repayment by refinancing of loans and negative earnings
Return on equity ratio (%)	-289.06%	-144.17%	Due to significant increase in losses
Return on capital employed (%)	-5.63%	2.79%	Due to significant increase in losses

Revenue

During the year, standalone revenue was 9781.90 Lakhs (previous year 13462.33 Lakhs), Consolidated revenue was 10337.90 Lakhs (previous year 13401.41 Lakhs).

During the year, standalone exceptional income/(expenses) was (1213.36) Lakhs (previous year 938.95), Consolidated exceptional income/(expenses) was (1213.36) Lakhs (previous year 938.95).

During the year, standalone EBIDTA profit before exceptional items was 1486.47 Lakhs, (previous year 1774.49 Lakhs). Consolidated EBIDTA profit before exceptional item was 1969.34 Lakhs), (previous year 1751.27 Lakhs).

Profit/(Loss) Before Tax ("PBT")

During the year, standalone Profit/(Loss) Before Tax was (4580.12) Lakhs (previous year (1756.70) Lakhs). Consolidated Profit/ (Loss) Before Tax was (4273.00) Lakhs (previous year (1943.41) Lakhs).

Net Profit/(Loss)

During the year, Standalone Net Profit/(Loss) was (4524.53) Lakhs (previous year (1680.76) Lakhs). Consolidated Net Profit/ (Loss) was (4218.00) Lakhs (previous year (1867.61) Lakhs).

Fixed Assets

The standalone year-end Gross Block increased to 56269.15 Lakhs (previous year 56097.44 Lakhs) mainly due to the addition in plant & machinery. The consolidated year-end Gross Block increased to 69090.07 Lakhs (previous year 68912.58 Lakhs) mainly due to the addition in plant & machinery.

Current Liabilities

The standalone current liabilities decreased to 6415.24 Lakhs (previous year 9141.99 Lakhs) mainly due to RPS issued against merger compensation payable and value of RPS captured as non-current liabilities (borrowings). The consolidated current liabilities decreased to 6462.73 Lakhs (previous year 9187.35 Lakhs) mainly due to RPS issued against merger compensation payable and value of RPS captured as non-current liabilities (borrowings).

Loan Funds (Secured)

The standalone Secured Loan Funds increased to 17767.68 Lakhs (previous year 15157.78 Lakhs) primarily due to refinancing of earlier term loan and further term loan taken. The consolidated Secured Loan Funds increased to 17767.68 Lakhs (previous year 15157.78 Lakhs) primarily due to refinancing of earlier term loan and further term loan taken.

Loan Funds (Unsecured)

The standalone Unsecured Loan Funds decreased to 6204.67 Lakhs (previous year 10781.33 Lakhs) primarily due to part repayment of ICD during the year. The consolidated unsecured loan funds decreased to 7106.38 Lakhs (previous year 11627.91 Lakhs) primarily due to part repayment of ICD during the year.

Instruments entirely equity in nature (Perpetual Loan)

The standalone Perpetual Loan Funds increased to 14402.58 Lakhs (previous year 13892.58 Lakhs) on account of further perpetual loan taken during the year. The consolidated perpetual loan funds increased to 14482.58 Lakhs (previous year 13972.58) on account of further perpetual loan taken during the year.

Share Capital and Preference Shares

The paid-up Equity Share Capital and preference share capital of the Company as on March 31, 2025 was 649.93 Lakhs and 4255.6838 Lakhs respectively. During the year under review, the Company has not issued any shares with differential voting rights or ‘sweat equity shares and has not granted any stock options. As on March 31, 2025 none of the Directors of the Company hold shares or convertible instruments of the Company.

Dividend and Transfer to Reserves

In view of the losses during the current year, the Board of Directors regrets their inability to declare dividend. No amount was transferred to the reserves during the year.

Material changes and commitments

There were no material changes and commitments affecting the financial position of the Company which have occurred, between the end of the financial year of the Company to which the financial statements relate and the date of the Report.

Opportunities and Threats

Our success as an organization depends on our ability to identify opportunities and leverage them while mitigating the risks that arise while conducting our business. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Some of the opportunities and key risks, anticipated impact on the Company and mitigation strategy is as follows:

Risks and Concerns:

Risk management process includes identification of risks, its underlying dynamics, mitigation mechanism, prioritization of risk, measurement of key indicators and establishing a monitoring system. A Company-wide awareness of risk management policies and practices are being inculcated to minimize the adverse effect of risks on the operating results and the subject of management of risks is being approached in a planned and coordinated manner. Elucidation of role clarity, understanding of level of authority and reporting system is expected to help this process significantly.

The Company has identified key risks such as Market risks, Regulatory risks, Human resource risks, Commodity price risks. Key Risks include fluctuation in raw materials prices, increased global and local competition, sales channel disruption. Retaining the existing talent pool and attracting new talent. Regulatory Risks include changes in taxation regime, government policies with respect to textiles, pollution control, Industrial Relation issues & regulatory compliances.

Legal and Regulatory

Compliance with laws and regulations is an essential part of your Companys business operations. We are subject to laws and regulations in diverse areas as product safety, product claims, trademarks, copyright, patents, competition, employee health and safety, the environment, corporate governance, listing and disclosure, employment and taxes. Frequent changes in legal and regulatory regime and introduction of newer regulations with multiple authorities regulating same areas lead to complexity in compliance. We closely monitor and review our practices to ensure that we remain complaint with relevant laws and legal obligations.

Systems and Information

Your Companys operations are increasingly dependent on IT systems and the management of information. Increasing digital interactions with customers, suppliers and consumers place even greater emphasis on the need for secure and reliable IT systems and infrastructure, and careful management of the information that is in our possession.

The cyber-attack threat of unauthorised access and misuse of sensitive information or disruption to operations continues to increase. To reduce the impact of external cyber-attacks impacting our business, we have sufficient security measures including firewalls and threat monitoring systems in place, complete with immediate response capabilities to mitigate identified threats. Our employees are trained to understand these requirements.

Internal Control Systems and their adequacy:

The Company has an Internal Control systems, which ensures that all transactions are satisfactorily recorded and reported and all assets are protected against loss from an unauthorized use or otherwise. The internal control systems are supplemented by an internal audit system carried out by independent firms of Chartered Accountants and a periodical review by the management. The findings of such Internal Audits are addressed through suitable corrective measures. The Audit Committee of the Board meets at a regular interval and advises on significant issues raised by, both, the Internal Auditors and the Statutory Auditors. The process of internal control, systems, statutory compliance, risk analysis, information technology and its management are woven together to provide a meaningful support to the management of the business.

Batliboi & Purohit, Chartered Accountants, the statutory auditors of the Company have audited the financial statements included in this annual report and have issued report, inter alia, on the internal financial controls over financial reporting as defined under section 143 of the Companies Act, 2013.

Deposits

During the year under review, the Company has not accepted any deposits from public falling within the meaning of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

Particulars of loans, guarantees or investments

Particulars of Loans, Guarantees or Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Directors and Key Managerial Personnel

As per the provisions of Section 152(6) of the Companies Act, 2013, Mrs. Sunita Khanna is due to retire by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. The Board of Directors recommends her re-appointment as Director of the Company.

The tenure of Mr. D G Prasad and Mr. Pradip Kapadia as Independent Directors of the Company ended on close of business hours of December 28, 2024. The Board places on record its appreciation for the invaluable services and guidance rendered by Mr. D G Prasad and Mr. Pradip Kapadia to the Board and the Company during their tenure as Member of the Board/Committees of the Board.

Based on the recommendation of Nomination and Remuneration Committee and subject to approval of the Shareholders of the Company, the Board appointed Mr. Ganesan Rajamani and Mr. Sanjiv Tipnis as Additional Directors (Non-Executive, Independent Director) of the Company w.e.f January 24, 2025 and May 08, 2025 respectively for a period of five years.

The Shareholders of the Company by way of postal ballot, results of which were declared on April 19, 2025 approved appointment of Mr. Ganesan Rajamani as Independent Director for a term of five years commencing from January 24, 2025.

In the Notice of ensuing Annual General Meeting of the Company an item for appointment of Mr. Sanjiv Tipnis as Independent Director of the Company shall be included.

Key Managerial Personnel of the Company as on March 31, 2025 were Mr. Gautam V. Kumtakar, Managing Director & Chief Executive Officer, Mr. Rakesh M. Nanwani, Company Secretary & Compliance Officer and Mr. Vipan Kumar Sharma, Chief Financial Officer.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of Independence as prescribed both under the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), 2015 and there has been no change in the circumstances which may affect their status as Independent Directors during the year.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees for attending meetings of Board/ Committee of the Company.

Independent Directors are familiarized with their roles, rights and responsibilities in the Company through presentation made to them from time to time. The details of familiarization programes conducted have been hosted on the website of the Company and can be accessed at www.gokaktextiles.com

Audit Committee of the Board of Directors

The details pertaining to the composition of the Audit Committee of the Board of Directors are included in the Corporate Governance Report which forms part of this report.

Meetings of the Board

The Board met at least once in each quarter and 5 (five) meetings of Board were held during the year and the maximum time gap between two Board meetings did not exceed the time limit prescribed under the Companies Act, 2013. The details have been provided in the Corporate Governance Report.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR), 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually, as well as, the evaluation of the working of its Committee(s).

The performance of the Board was evaluated by the Board on the basis of the process laid in the Charter for Performance Evaluation, the structured questionnaires for performance evaluation, parameters/criteria, such as, degree of fulfillment of key responsibility by the Board, Board Structures and Composition, establishment and delineation of responsibilities to the Committees, effectiveness of Board processes, information and functioning, Board culture and dynamics and quality of relationship between the Board and the Management.

The performance of the committees viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility was evaluated by the Board on the basis of parameters/criteria such as degree of fulfillment of key responsibilities, adequacy of committee composition, effectiveness of meetings, committee dynamics and, quality of relationship of the committee with the Board and the Management.

The Board reviewed the performance of the individual Directors (without the concerned director being present).

In a separate meeting of Independent Directors, the performance of Non-Independent Directors of the Board as a whole and the performance of the Chairman were evaluated.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed and adopted a policy for selection and appointment of Director, Senior Management and their remuneration. Remuneration Policy of the Company acts as a guideline for determining, inter alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal, and evaluation of the performance of the Directors, Key Managerial Personnel and Senior Managerial personnel.

Nomination & Remuneration Policy is annexed as Annexure II to this Report.

Disclosure as required under section 197(12) of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure III to this Report.

Auditors and Audit Report Statutory Auditors

Pursuant to the provisions of section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, Batliboi & Purohit, Chartered Accountants (ICAI Firm Registration no. 101048W) were appointed as the Statutory Auditors of the Company for a term of 5 (five) years to hold office from the conclusion of the 11^th Annual General Meeting of the Company till the conclusion of the 16^th Annual General Meeting of the Company.

Pursuant to the provisions of section 139 (2), M/s Batliboi & Purohit, Chartered Accountants, were eligible to be re-appointed as statutory auditors of the Company for another term of five years.

The shareholders of the Company at their 16^th Annual General Meeting held (AGM) held on September 29, 2022 have appointed Batliboi & Purohit, Chartered Accountants as Statutory Auditors of the Company until the Conclusion of the 21^st Annual General Meeting of the Company to be held in the year 2027 and authorized the Board to fix the remuneration.

The Audit Report of the Statutory Auditors forms part of the Annual Report. The Auditors Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory.

Cost Auditors

As per the requirements of section 148 of the Companies Act, 2013, read with The Companies (Cost Records and Audit) Rules, 2014, the cost accounts of the Company are required to be audited by a Cost Accountant. The Board of Directors of the Company on the recommendation of the Audit Committee, appointed Mr. Mukesh R. Dekhtawala, Cost Accountant as Cost Auditor for the financial year 2025 – 2026 on a remuneration of 1.65 lakhs plus out of pocket expenses. As required under the Companies Act, 2013 necessary resolution seeking Shareholders ratification for the remuneration to Cost Auditor is included in the Notice convening the 19^th Annual General Meeting of the Company.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed KDSH & Associates LLP, Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as Annexure IV to this Report. The Secretarial Audit Report contains observations which are self-explanatory.

The Secretarial Audit of Gokak Power & Energy Limited, (Material Subsidiary) for the FY 2024-25 was carried out pursuant to Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. The Report of the Secretarial Auditor of Gokak Power & Energy Limited does not contain any qualification, reservation or adverse remark or disclaimer.

Corporate Social Responsibility

The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility were not applicable to the Company for the FY 2024-25. The Board of Directors of the Company has, however, voluntarily constituted a Corporate Social Responsibility Committee in compliance with Section 135 of the Act.

The Company is committed to its stakeholders to conduct business in an economically, socially and environmentally sustainable manner that is transparent and ethical.

Vigil Mechanism / Whistle Blower Policy

The Company has Whistle Blower Policy/Vigil Mechanism to deal with instances of fraud and mismanagement, if any. The policy is also available on the website of the Company.

Extract of Annual Return

Pursuant to Section 92(3) read with Section 134 (3)(a) of the Companies Act, 2013, the Annual Return as on March 31, 2025 is available on website of the Company viz., www.gokaktextiles.com

Related Party Transactions

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company with the Promoter, Directors, Key Managerial Personnel or the designated persons which may have a potential conflict with the interest of Company at large except power purchase from the subsidiary company for captive consumption.

All related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered pursuant to the omnibus approval so granted are placed before the Audit Committee on a quarterly basis.

Form AOC-2 is annexed as Annexure V to this report, pursuant to section 188 of the Companies Act, 2013. The policy on Related Party Transactions as approved by the Board is available on website of the Company viz., www.gokaktextiles.com.

Corporate Governance and Management Discussion and Analysis

The guiding principle of the Code of Corporate Governance is ‘harmony i.e balancing the need for transparency with need to protect the interest of the Company, balancing the need for empowerment at all levels with the need for accountability. A detailed report on Corporate Governance is annexed as a part of this Annual Report and the Management Discussion and Analysis report forms part of this report.

A Certificate on compliance of conditions of Corporate Governance issued by Mr. Kiran B. Desai, Designated Partner, KDSH & Associates LLP, Company Secretaries is annexed to the Report on Corporate Governance.

A certificate from a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority is annexed to the Report on Corporate Governance.

Significant and Material Orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators / Courts which would impact the going concern status and Companys operations in future.

Statutory Compliances

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace as per with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Internal Complaints & Committee (ICC) has been setup to redress complaints received regarding sexual harassment as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the ICC includes external member.

The details of Complaints received during the year:

Particulars	Status
1 Number of Complaints of Sexual harassment filed in the year	Nil
2 Number of Complaints disposed of during the year	Nil
3 Number of cases pending for more than ninety days	Nil

During the year under review, no complaints on sexual harassment were received.

Statement by the company with respect to the compliance to the provisions relating to the Maternity Benefits Act, 1961:

The Company confirms that it adheres to the provisions of the Act, ensuring maternity leave benefits, suitable workplace facilities, and other related provisions. During the period under review, there was no eligible employee to avail the benefits to the Act.

Directors Responsibility Statement

Pursuant to the provisions of Section 134(3)(c) and 134 (5) of the Companies Act, 2013 and based on the representations received from the operating management, the Directors hereby confirm that :a. in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures; b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period; c. they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. they have prepared the annual accounts on a going concern basis; e. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Human Resources / Industrial Relations

Developments in Human Resources / Industrial Relations front:

The Company has developed a strong human resource base which helped the company to retain the employees for a very long time in view of learning opportunity, comfortable housing, very good educational facilities at minimum educational fees for the children of the Employees. The organization also has good HR Policies for employees in place.

In view of low attrition of the employees Management is encouraging employees to undertake higher responsibilities in the ladder of hierarchy so that the fresh talent hiring at the bottom of the organizational pyramid provides continuity of development at each level. The Company provides skill building trainings to employees internally. The hiring of experienced employees from outside is the last priority and first opportunity is provided to employees in line function or cross function as well.

The company has different HR processes for development of human resource which includes performance management system for appraisal of employee performance, skill development and believes in the fundamentals of Train, Retrain & Retain employees by way giving three R, Rewards, Recognition & Respect to employees.

The Management has developed very good cordial Industrial relations and has been able to carry out operations successfully despite continued challenges of market down turn, fierce competition having high input cost by achieving flexibility in operations suitable to the requirements of business.

Change in the Nature of Business, If Any:

There is no change in the Nature of business of the Company.

Transfer of Unclaimed Dividend to Investor Education and Protection Fund:

Since no dividend has been declared by the Company, there was no unpaid/unclaimed dividend and accordingly the provisions of Section 125 of the Companies Act, 2013 do not apply.

Details of application made or any proceeding pending under the insolvency and bankruptcy code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year: NIL

The details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof:

The Company has not undergone for valuation during the year.

Particulars of Employees and Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo a. The information required pursuant to Section 197 of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during the business hours on working days of the Company. Any member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company. b. Information relating to the Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014 is annexed herewith as Annexure VI to this report.

Cautionary Statement:

Statements in the Boards Report and Management Discussion & Analysis describing the Companys objectives, estimates, expectations or projections, outlook etc., may be ‘forward looking statements within the meaning of the applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to factors beyond control. Important factors that could make a difference to the Companys operations include economic conditions affecting demand/ supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the government regulations, tax laws and other statutes and other factors such as litigation and industrial relations.

Acknowledgements

Your Directors acknowledge and thank all stakeholders of the Company viz. customers, members, employees, dealers, vendors, banks and other business partners for their valuable sustained support and encouragement. Your Directors look forward to receiving similar support and encouragement from all stakeholders in the years ahead.

Place : Mumbai	For and on behalf of the Board of Directors
Date : May 23, 2025
	Vinod J. Bhandawat	Gautam V. Kumtakar
	Chairman	Managing Director & Chief Executive Officer
	DIN : 02873571	DIN: 09791999
Registered Office
#1, 2nd Floor, 12th Cross,
Ideal Homes, Near Jayanna Circle,
Rajarajeshwari Nagar, Bengaluru- 560 098