GTN Textiles Ltd Directors Report

To the Members,

Your Directors present the 21 st (Twenty first) Boards Report together with the Audited Statement of Accounts (Standalone & Consolidated) for the year ended 31 st March 2026.

1. FINANCIAL RESULT

The Standalone and Consolidated financial highlights of your Company for the year ended 31 st March 2026 are summarized as follows:

(Rs in Crores)

Financial Results	Standalone		Consolidated
	FY 2025-26	FY 2024-25	FY 2025-26	FY 2024-25
Revenue from Operations / Other Income	10.23	*	10.23	*
EBITDA	(1.13)	*	(1.13)	*
Finance cost	0.20	*	0.20	*
Depreciation	---	*	----	*
Profit / (Loss) / before Exceptional item and Tax	(1.33)	*	(1.33)	*
Exceptional item - Impairment in Investment in Associate	(10.40)		-
Tax expense / (Credit) - including Deferred tax	1.05	*	1.05	*
Profit / (Loss) post tax for the year from continuing operations	(12.78)		(2.38)
Profit / (Loss) before Tax for the year from discontinued operations	(4.92)	(7.99))	(4.92)	(7.99)
Tax expenses on discontinued operations	(4.08)	(0.17)	(4.08)	(0.17)
Profit / (Loss) post tax for the year from discontinuing operations	(9.00)	(7.82)	(9.00)	(7.82)
Other Comprehensive Income (net of Tax)		0.39		0.39
Total Comprehensive loss for the year	(21.78)	(7.43)	(11.38)	(7.43)

*Since Cotton Yarn manufacturing operations were discontinued during the second quarter of FY 2022-23, there is no revenue / expenses from operations for FY 2024-25.

2. FINANCIAL PERFORMANCE

Pursuant to the approval by the Board of Directors and Shareholders, Company had discontinued cotton yarn manufacturing operations w.e.f. 13.06.2022. During FY 2024-25, the Company has also sold its fixed assets and repaid the entire bank dues fully without any haircut and also paid VRS settlement compensation to the workmen. There is NIL bank borrowings and Companys account is standard. Post repayment, the Company is carrying out trading in cotton yarn.

During the year under review, Company has successfully completed trading in cotton yarn of about 10.23 Cr with a gross margin of 0.41 Cr. At EBIDTA level there is a marginal loss of 1.13 Cr mainly on account of Admin and other fixed expenses.

Exceptional item for the year represent Impairment in the value of investment held in an Associate Company based on its closing market value of shares in the Stock Exchange as at 31.03.2026. Combined Net loss post tax for the year from continuing and discontinued operations was higher at 21.78 Cr (previous year Net loss from discontinued operations was 7.43 Cr) mainly due to impairment on investment.

Company has rationalised and reduced the Employee cost and other fixed expenses during the current year and also taken necessary steps to increase the revenue from trading in cotton yarn in the ensuing years for better prospects of the Company.

3. TRADING OF COTTON YARN

Pursuant to the stoppage of Cotton yarn manufacturing operations of the Company with effect from 13.06.2022, your Board has taken effective steps to sell the assets of the Company and to pay the dues of the workmen & employees, bankers, creditors etc. The Companys bankers have issued NOC for sale of assets and thereby, the Company has sold 25.72 acres of Freehold Land for a Sale consideration of 87.14 Cr and also sold machinery and other assets. From the net sale proceeds, the Company has repaid / paid (i) Banks dues fully without any haircut (ii) VRS settlement to workmen and (iii) certain other liabilities (Creditors, ICDs and un- secured loans). Consequent to repayment of banks dues fully, the status of the account has become Standard.

Demand scenario of the Indian Textiles Industry is showing signs of improvement with various Government initiatives viz. Execution of FTA with UK, advance negotiations with EU on FTA, higher budgetary allocation in FY 2025-26 for Textiles sector, enhanced credit access, export promotion measures, creation of the Bharat Trade Net digital platform which will streamline trade documentation, facilitate smoother global integration and ease market access for small and medium textile enterprises, etc. China plus one policy adopted by many countries in procurement and Political tensions, coupled with economic woes at Bangladesh and Sri Lanka.

Since all bank dues and other major Liabilities have already been paid, the Company can take advantage of the improved demand situation for Indian textiles industry and can step up trading of cotton yarn or any other business as permitted in the objects clause of the Memorandum of Association, for better prospects of the Company.

4. DIVIDEND

In view of the losses for the financial year ended 31 st March 2026, the Board of Directors, regret their inability to recommend any dividend for the year 2025-26.

5. CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements, prepared in accordance with the applicable Indian Accounting Standards issued by the Institute of Chartered Accountants of India and Regulation 33 of the SEBI (LODR) Regulations, 2015 together with Auditors Report. The Auditors report on the consolidated financial statements also attached. The same is with unmodified opinion (unqualified).

6. SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANY

The Company did not have any Subsidiary or Joint Venture during the financial year. The Company has one Associate Company, Patspin India Limited.

7. MANAGEMENT DISCUSSION AND ANALYSIS

As mentioned in item 2, Financial Performance above, the manufacturing operations of the Company has been suspended with effect from 13.6.2022. Since major part of the property, plant and equipment have been disposed of and liabilities settled, the Company now, with available funds, intent to commenced trading in cotton yarn or any other business as permitted in Object Clause in the Memorandum of Association. Normal Business challenges are expected to remain as the Company operates in a competitive sector. The Company has adequate systems of Internal Controls commensurate with its size and operations to ensure orderly and efficient conduct of business. These controls ensure reduction and detection of fraud and error, adequacy and completeness of the accounting records and timely preparation of reliable financial information.

With the reasons above, the Management Discussion and Analysis Report on the operations of the Company, as required under the SEBI (LODR) Regulations, 2015 is not separately attached.

8. PUBLIC DEPOSITS

The Company does not have Deposits as contemplated under Clause V of the Companies Act 2013. Further, the Company has not accepted any such deposits during the year ended 31 st March 2026.

9. CORPORATE GOVERNANCE

The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance.

A separate statement on Corporate Governance together with a certificate from the Practicing Company Secretary of the Company regarding compliance of conditions of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual Report.

10. DIRECTORS AND KEY MANAGERIAL PERSONS

All the Directors have affirmed that they have complied with the Companys Code of Business Conduct & Ethics. In terms of requirements of the Listing Regulations, the Board has identified core skills, expertise and competencies of the Directors in the context of the Companys businesses, which are detailed in the Report on Corporate Governance.

Further, in terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent Directors of the Company have confirmed that they have registered themselves with the databank maintained by the Indian Institute of Corporate Affairs. The Independent Directors who were required to clear the online proficiency selfassessment test have passed the test. In the opinion of the Board, the Independent Directors fulfil the conditions of independence, are independent of the management, possess the requisite integrity, experience, expertise, proficiency and qualifications to the satisfaction of the Board of Directors.

As stated in previous Boards report, Shri. B.K.Patodia has been conferred lifetime title of Chairman Emeritus effective 6 th August 2025.and the Board appointed Shri. Umang Patodia as Chairman of the Company in his place. Shri V N Balakrishnan Non-Executive Independent Director opt out for his second term, due to advancing age and certain personal reasons and Shri C K Gopalakrishnan Nair (DIN: 00521840) has been appointed as an Independent Director for a second term tenure of five consecutive years.

Pursuant to the requirements of the Companies Act, 2013, Smt Kalpana M Thakker (DIN 08601866), retires by rotation at the ensuing Annual General Meeting and, being eligible, offers herself for re-appointment. The Board recommends the appointment / re-appointment of the above Director for approval. The brief details of the Director proposed to be appointed / re-appointed, as required under Regulation 36 of SEBI Listing Regulations, are provided in the Notice of Annual General Meeting.

Other than the above, there is no change in the composition of the Board of Directors and the Key Managerial Personnel during the year under review.

11. KEY MANAGERIAL PERSONNEL

Shri Umang Patodia, Managing Director, Shri. M Achuthan, Chief Financial Officer and Shri E.K.Balakrishnan, Company Secretary were the Key Managerial Personnel of your Company, in accordance with the provisions of Section 203 of the Companies Act 2013 during the year under review.

12. NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met 4 (Four) times during the financial year 2025-26. The details of the meetings of the Board of Directors of the Company convened and attended by the Directors during the financial year 2025-26 are given in the Corporate Governance Report which forms part of this Annual Report.

13. MEETING OF INDEPENDENT DIRECTORS

During the year under review, the Independent Directors met on 17 th March 2026 without the presence of non-Independent Directors and members of the Management. For more details, visit Corporate Governance Report annexed to this Report.

14. INDEPENDENT DIRECTORS DECLARATION

The Company has received the necessary declaration from each Independent Director in accordance with Section 149(7) of the Companies Act, 2013 read with Regulation 25(8) of the SEBI Listing Regulations, that he/she meets the criteria of independence as laid out in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI Listing Regulations.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied of the integrity, expertise, and experience (including proficiency in terms of Section 150(1) of the Companies Act, 2013 and applicable rules thereunder) of all Independent Directors on the Board. Further, in terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, Independent Directors of the Company have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

15. DIRECTORS RESPONSIBILITY STATEMENT

The Board of Directors acknowledge the responsibility for ensuing compliances with the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 in the preparation of Annual Accounts for the year ended on 31 st March, 2026 and state that:

1. in the preparation of the Annual Accounts, the applicable Indian Accounting Standards have been followed and there are no material departures from the same

2. the Directors 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 your Company as at 31 st March 2026 and of the profit or loss of the Company for that period;

3. the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets

of your Company and for preventing and detecting fraud and other irregularities;

4. the Directors have prepared the Annual Accounts on a going concern basis;

5. the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

6. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

16. BOARD EVALUATION

Pursuant to the provisions of Companies Act and Listing Regulations, the Board has carried out the annual performance evaluation of its own performance, of Committees of the Board and of the Directors individually. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specified duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company.

17. FAMILIARISATION PROGRAMME FOR DIRECTORS

At the time of appointing a Director, a formal letter of appointment is given, which inter alia explains the role, function, duties and responsibilities expected as a Director of the Company. This is to provide insights into the Company to enable the Independent Directors to understand its business in depth, to familiarize them with the process, business and functionaries of the Company and to assist them in performing their role as Independent Directors of the Company. The Director is also explained in detail the Compliance required under the Companies Act, 2013, SEBI (LODR) Regulations, 2015 and other relevant regulations and affirmation taken with respect to the same.

The Chairman and the Management has also one to one discussion with the Directors to familiarize with the Companys operations.

18. AUDITORS

M/s. L.U. Krishnan& Co. (Regn.No.001527S) Chartered Accountants, Chennai were appointed as the Auditors of the Company for second term of 5 years at the 17thAnnual General Meeting (AGM) held on 30 th September, 2022 to hold office till the conclusion of the 22ndAGM of the Company to be held in the year 2027. The Auditors Report for FY 2025-26 does not contain any qualifications, reservations or adverse remarks.

19. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Shri. MRL Narasimha, Practicing Company Secretary (C.P No. 799) is acting as Secretarial Auditor of the Company for a term of 5 (five) consecutive years from 1 st April, 2025 to 31 st March, 2030.

Secretarial Audit Report for the financial year ended 31 st March, 2026 issued by Shri MRL Narasimha Practising Company Secretary in Form MR-3 forms part to this report - as Annexure I.

The Report for FY 2025-26 does not contain any qualifications, reservations or adverse remarks.

20. COST AUDITORS

In terms of the Companies (Cost Records and Audit) Amendment Rules, 2014 published vide GSR No. 01(E) on 31 st December 2014 issued by the Central Government in terms of the powers conferred by Section 148 of the Companies Act, 2013, due to the reduction of the turnover from the auditable product as per the previous audited financial statement and also there is no manufacturing operations being held in the Company, the cost audit is not mandatory during the next financial year 2026-27. Hence Board has not recommended the appointment of Cost Auditor for the next FY 2026-27.

21. EXTRACT OF ANNUAL RETURN

Pursuant to provisions of Section 134(3)(a) and Section 92(3) of the Companies Act, 2013, read with Rule 12 of the Companies( Management and Administration)Rules ,2014, the extract of the Annual Return of the Company for the Financial Year 31 st March 2026 will be uploaded on the website of the Company and can be accessed at the www.gtntextiles.com

22. RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions entered between the Company, directors, management and their relatives, except for those disclosed in the financial statements. All the contracts/ arrangements/ transactions entered by the Company with the related parties during the Financial Year 2025-26 were in the ordinary course of business and on an arms length basis, and whenever required the Company has obtained necessary approvals as per the related party transaction policy of the Company. Accordingly, the particulars of contracts or arrangements with related parties which is required to be disclosed under Section 134(3)(h) read with Section 188(1) of the Companies Act, 2013 in Form AOC-2 is not applicable to the Company for Financial Year 2025-26 and, hence, the same does not form part of the Boards Report.

The Company has formulated the policy on Related Party Transactions, and the same is available on the website of the Company at www.gtntextiles.com. The details of related party disclosures form part of the notes to the Financial Statements provided in this Integrated Annual Report.

23. LOANS & INVESTMENTS

Details of loans, guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to Financial Statements forming part of this report.

24. CREDIT RATING

Company has fully repaid all its bank dues and as on date there are no bank borrowings, hence no external credit rating is required.

25. RISK MANAGEMENT

The Company has laid down a well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out to identify, evaluate, manage and monitor business risks. The Audit Committee and the Board periodically review the risks and suggest steps to be taken to manage/ mitigate the same through a properly defined framework.

During the year, a risk analysis and assessment was conducted, and no major risks were noticed, which may threaten the existence of the Company.

26. VIGIL MECHANISM / WHISTE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy to report genuine concerns or grievances. The Vigil Mechanism (Whistle Blower Policy) has been posted on the Companys website www.gtntextiles.com.

27. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Even though the provisions of Section 135 (5) of Companies Act, 2013 regarding Corporate Social Responsibility are not yet attracted, the Company has been, over the years, pursuing as part of its corporate

philosophy, an unwritten CSR policy voluntarily which goes much beyond mere philanthropic gestures and integrates interest, welfare and aspirations of the community with those of the Company itself in an environment of partnership for inclusive development.

28. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is as follows:

a) Conservation of Energy

The manufacturing operations of the Company has been suspended with effect from 13.6.2022 and major fixed assets have been sold and most of the liabilities have been paid. Now the Company carry on trading in cotton yarn or any other business as permitted in Object Clause in the Memorandum of Association, and hence it does not consume heavy electricity.

b) Technology absorption

Since no manufacturing activity-Not Applicable.

c) Foreign Exchange Earnings and Outgo

Foreign Exchange Earnings - NIL Foreign Exchange Outgo - NIL

29. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an effective internal control and risk mitigation system designed to effectively control the operations at its Head Office and Depots. The internal control systems are designed to ensure that the financial and other records are reliable for the preparation of financial statements and for maintaining assets. The Company has well designed Standard Operating.

Procedures. Independent Internal Auditors conduct audit covering a wide range of operational matters and ensure compliance with specified standards. Planned periodic reviews are carried out by Internal Audit. The findings of Internal Audit are reviewed by the top management and by the Audit Committee of the Board of Directors.

Based on the deliberations with Statutory Auditors to ascertain their views on the financial statements including the Financial Reporting System and Compliance to Accounting Policies and Procedures, the Audit Committee was satisfied with the adequacy and effectiveness of the Internal Controls and Systems followed by the Company.

30. NOMINATION & REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. More details on the same are given in the Corporate Governance Report.

31. I NVESTOR EDUCATION AND PROTECTION FUND (IEPF)

In accordance with the applicable provisions of Companies Act, 2013 (hereinafter referred to as the Act) read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as the IEPF Rules), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven (7) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven (7) consecutive years or more shall be transferred to the demat account of the IEPF Authority. The details relating to shares on which dividends were unclaimed are provided in the General Shareholders Information section of Corporate Governance report forming part of this Annual Report.

32. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an anti-sexual harassment policy in line with the requirements of the sexual harassment of women at the workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Compliance Committee (ICC) is already been functioned for redressing complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The Company has not received any complaints under this policy during the year ended 31 st March, 2026.

33. COMPLIANCE WITH MATERNITY BENEFIT ACT, 1961

During the FY2025-26, provisions relating to the Maternity Benefit Act, 1961 does not apply to the Company.

34. PARTICULARS OF EMPLOYEES PURSUANT TO SECTION 134 (3) (q) OF THE COMPANIES ACT, 2013 READ WITH RULE 5 (1) OF THE COMPANIES (APPOINTMENT AND REMUENRATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information required pursuant to section 134 (3) (q) of the Companies Act, 2013 read with Rule 5(1) 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 and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members at the Registered office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General meeting. If any Member is interested in obtaining a copy thereof, such member may write to the Company in this regard.

35. PERSONNEL & INDUSTRIAL RELATIONS

Industrial Relations were cordial and satisfactory. There were no employees whose particulars are to be given in terms of Section 134(3)(q) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

36. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant and material orders passed by the Regulators or Courts or Tribunals that would impact the going concern status of your Company and its future operations.

37 REPORTING OF FRAUD

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditors have not reported any instances of frauds committed in the Company by its officers or employees to the Audit Committee under Section 143(12) of the Companies Act, 2013, the details of which need to be mentioned in the Boards Report.

38. GENERAL

There was no issue of equity shares with differential rights as to dividend, voting or otherwise: and; there was no issue of shares (including sweat equity shares) to the employees of the Company under any scheme.

39. OTHER DISCLOSURES

a) There has been no change in the nature of business of the Company as on the date of this Report.

b) There were no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this Report.

c) There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 during the year under review.

40. ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the concerned Departments of the State and Central Government, valuable customer, Employees and Shareholders for their assistance, support and cooperation to the Company.

For and on behalf of the Board of Directors

	UMANG PATODIA
Place: Kochi	Chairman
Date :10.08.2026	(DIN: 00003588)