Jindal Worldwide Ltd Management Discussions

INDIAN ECONOMY OVERVIEW

Indias economic narrative in F.Y 2024-2025 reflects resilience and steady progress, with GDP growth projected at 6.5% despite global uncertainties and trade disruptions. Rising GST collections, higher e-way bill generation, and improving consumer sentiment underscored sustained momentum, particularly in the final quarter. A manufacturing revival, coupled with steady rural demand driven by rising household consumption, painted a picture of strengthening economic activity, setting a robust foundation for growth.

Retail inflation in India, measured by the Consumer Price Index (CPI), eased to 4.6% in the F.Y 2024-25. This notable decline underscores the success of the Reserve Bank of Indias pro-growth monetary strategy, which has effectively balanced economic expansion with price stability. Notably, the year-on-year inflation rate for March 2025 fell to 3.34%, dropping by 27 basis points from February 2025, marking the lowest monthly inflation figure since August 2019. These numbers reflect a sustained policy focus on controlling inflation while supporting economic momentum.

Industrial performance, while moderated, showed signs of recovery. The Index of Industrial Production (IIP) growth slowed to 4% in F.Y 2024-2025 from 5.9% the previous year, with manufacturing, electricity, and mining registering modest gains. The Reserve Bank of Indias surveys highlighted stronger production, order books, and capacity utilisation, signalling an industrial upswing. Complementing this, the HSBC India Manufacturing PMI rose to 58.2 in April 2025, driven by a surge in international orders and increased employment and purchasing activity.

The Commerce and Industry Ministry reported that Indias exports reached a record US$824.9 billion in F.Y 2024-2025. This achievement was significantly boosted by services exports, which hit an all-time high of US$387.5 billion - a 13.6% increase year-over-year. Even merchandise exports, excluding petroleum, saw record growth despite global challenges.

Outlook: Indias economic outlook for F.Y 2025-2026 remains fundamentally sound. The Reserve Bank of India (RBI) has revised its forecast to 6.5%. Domestic demand, bolstered by government infrastructure spending and tax incentives for middle-income groups, is expected to drive growth. The RBIs accommodative monetary policy, including recent rate cuts, aims to support consumption and investment.

Despite external challenges, such as global trade uncertainties and potential volatility in commodity prices, Indias economy is poised to maintain steady growth. A continued focus on human capital development, digitalisation, and structural reforms will be crucial to sustaining this momentum and enhancing long-term economic prospects.

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GLOBAL TEXTILE MARKET

The global textile industry in 2024 exhibited resilience and adaptability in the face of various challenges. While forecasts suggested moderate growth, the reality proved to be more intricate — specific sectors, such as technical textiles and sustainable fashion, witnessing growth, in contrast, the overall performance remained relatively subdued due to economic headwinds and geopolitical tensions.

In 2024, several pivotal trends significantly influenced the industry. These include a pronounced emphasis on sustainability, the integration of digital technologies across the value chain, increased automation within manufacturing processes, the ongoing expansion of e-commerce, a growing preference for nearshoring and reshoring strategies, a rising demand for functional and smart textiles, and the expanding applications of technical textiles.

Despite some growth areas, the global textile industry confronted considerable headwinds in 2024. Economic slowdowns in significant regions curbed consumer spending, reducing demand for apparel and textiles. Geopolitical risks, notably the Russia-Ukraine and US-China trade conflicts, interrupted supply chains and induced price volatility. Escalating inflation and raw material costs, especially cotton, squeezed manufacturers profit margins.

Heightened consumer awareness and more stringent regulations encouraged sustainable practices and ethical sourcing, rendering greenwashing a pressing concern. Supply chain disruptions resulting from geopolitical events and climate change continued to persist. Moreover, formidable competition, particularly in price-sensitive markets, alongside intricate regulations, further complicated the industrys landscape.

Outlook: The global market for textiles was valued at approximately US$1.1 trillion in 2024 and is projected to attain a value of US$1.3 trillion by 2030, growing at a CAGR of 3.0% from 2024 to 2030. The sector is expected to continue its transformation in 2025, driven by the evolution of consumer preferences, technological advancements, and an increasing emphasis on sustainability and the principles of a circular economy.

The industry is likely to emphasise resilient and agile supply chains, greater digital integration, and the growing demand for ethically produced textiles.

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INDIAN TEXTILE MARKET

The Indian textile industry, one of the countrys oldest and most significant sectors — continued its trajectory of transformation and resilience in F.Y 2024-2025. Despite global headwinds—including inflationary pressures, geopolitical tensions, and uneven demand recovery—India remained one of the leading global producers of textiles and apparel.

The domestic textile market saw moderate growth in F.Y 2024-2025, supported by steady consumer demand, increased urbanisation, and a shift toward branded and sustainable apparel. Government initiatives such as the Production- Linked Incentive (PLI) Scheme and continued investments under PM MITRA Parks provided much-needed impetus to modernise infrastructure and enhance manufacturing capacity.

Textile and apparel exports faced challenges due to subdued demand from key markets like the US and EU, compounded by rising input costs and competition from low-cost producers. However, the gradual reopening of global trade routes and strategic trade agreements helped cushion the impact. The diversification into new markets and product segments, especially technical textiles and man-made fibres, emerged as promising growth areas.

During F.Y 2024-2025, the industry experienced notable developments on the international trade front. The signing of the Free Trade Agreement (FTA) between India and the United Kingdom marked a strategic milestone, offering Indian textile and apparel exporters preferential market access to one of their key destinations. This move is expected to enhance export competitiveness, reduce tariffs, and open new opportunities for value-added products in the UK.

Conversely, Bangladeshs recent decision to ban yarn imports from India posed a temporary setback, especially for exporters and traders engaged in raw material supply to the Bangladeshi apparel industry. This move may lead to short-term disruptions in regional supply chains; however, it also presents an opportunity for India to strengthen domestic value addition and explore alternative export destinations.

OUTLOOK

In 2024, the Indian textile market achieved a substantial size of US$146.6 billion. Projections from IMARC Group indicate a promising growth trajectory, with the market anticipated to reach US$213.5 billion by 2033. This forecast represents a growth of 3.85% CAGR from 2025 to 2033.

The Indian textile industry is anticipated to maintain a positive growth trajectory into F.Y 2025-2026, building on the recovery observed in the latter part of F.Y 2024-2025. Export volumes are expected to see continued year-on-year improvement, driven by restocking in key global markets like the EU, US, and UK, and the ongoing shift towards India

under the “China Plus One” sourcing strategy. Geopolitical factors in competing nations, such as Bangladesh and increasing US tariffs on other exporting countries, are also likely to bolster Indias market share in the global textile arena.

However, fluctuating raw material prices, logistics costs and workforce availability may impact operational efficiency. Addressing these issues through technological upgrades, skilling initiatives, and improved supply chain resilience will be crucial for sustained performance.

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Indias textile sector continues to benefit from progressive government policies aimed at strengthening infrastructure, boosting exports, and encouraging innovation. These initiatives directly support Jindal Worldwide in achieving sustainable growth and enhancing global competitiveness.

Bharat Tex 2025: India organised Bharat Tex 2025, a large-scale global textile event, from February 14-17, 2025, in New Delhi. The event showcased Indias textile ecosystem and aimed to accelerate the governments vision of “Farm to Fibre, Fabric, Fashion, and Foreign Markets.

PM Mega Integrated Textile Region and Apparel (PM MITRA) Parks Scheme: Approved for implementation until 2027-28 with an outlay of 4,445 crore; this scheme aims to establish seven world-class, integrated textile parks. These parks will offer plug-and-play facilities and aim to create an integrated textile value chain from “farm to fibre to fashion to foreign,” reducing logistics costs and generating employment.

Production Linked Incentive (PLI) Scheme for Textiles: This scheme incentivises the production of Man-Made Fibres (MMF), apparel, and technical textiles to enhance Indias manufacturing capabilities and exports. The allocation for F.Y 2025-2026 is 1,148 crore.

National Technical Textiles Mission (NTTM): Launched for the period 2020-21 to 2025-2026 with an outlay of 1,480 crore, this mission focuses on promoting research, innovation, development, skilling, market development, and export promotion in the technical textiles sector.

Samarth Scheme for Capacity Building in Textile Sector: Extended until F.Y 2025-2026 with an outlay of 495 crore, this scheme aims to provide industry-relevant, placement-oriented skilling programs across the textile value chain (excluding spinning and weaving). It aims to address the industrys skilled manpower requirements.

Amended Technology Upgradation Fund Scheme (ATUFS): While the original scheme period ended in March 2022, the government continues to support technology upgradation in the textile industry. In the Union Budget 2025-2026, 635 crores have been allocated for technology upgrades under ATUFS.

National Handloom Development Programme (NHDP) and Raw Material Supply Scheme: These schemes continue to support the handloom sector and the welfare of handloom workers by providing financial assistance for raw materials, upgraded looms, design innovation, and marketing.

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GLOBAL DENIM INDUSTRY

The global denim industry grew steadily in 2024, underpinned by shifting fashion preferences, expanding digital retail channels, and an accelerated push toward sustainable production. The markets resilience and adaptability have solidified denims s as a staple category across diverse consumer segments and global regions.

The Indian denim industry is a significant and growing global textile and apparel segment. A large domestic consumer base, a strong manufacturing presence, and increasing integration with the global fashion supply chain characterise it. The sectors resilience and adaptability have solidified its position as a significant contributor to the countrys textile and apparel landscape.

In F.Y 2024-2025, The Indian denim industry demonstrated strong resilience and adaptability, despite navigating a complex global economic environment. As one of the largest denim producers in the world, India maintained its crucial role in both domestic and export markets. The industry experienced a steady revival in demand, driven by the easing of inflationary pressures, a resurgence in discretionary consumer spending, and a heightened focus on value-added and sustainable denim products.

The Indian denim market is projected to reach approximately US$7.82 billion by FY 2027-2028, growing at a 15% CAGR between F.Y. 2022-2023 and FY 2027-2028. Specifically, the denim jeans segment generated revenues of US$2.43 billion in 2024, expecting to attain US$3.86 billion by 2030, reflecting a CAGR of 8.1% from 2025 to 2030.

Despite the positive trajectory, the industry faces challenges, including fluctuating raw material prices and intense competition from international markets. However, with continued investment in innovation, sustainable practices, and digital infrastructure, the Indian denim industry is well-positioned to capitalise on emerging opportunities and sustain its growth momentum in the coming years.

Demand Drivers

• Rising Disposable Income: The expanding middle class in India has more disposable income, boosting spending on lifestyle products, including denim.

• Growing Fashion Consciousness: Consumers are increasingly attuned to fashion trends, with denim becoming a staple of modern wardrobes.

• Urbanisation: The growth of urban centres and changing lifestyles have boosted the demand for casual wear, where denim plays a significant role.

• E-commerce Expansion: Greater access to e-commerce has made denim products more accessible to consumers nationwide.

Trends

• Sustainability: Consumers are increasingly conscious of the environmental impact of their purchases, leading to a greater focus on organic cotton, recycled fibres, and water-saving production technologies.

• Premiumisation: The premium and designer denim segment market is growing, driven by consumers seeking high-quality, fashionable products. Brands are offering innovative washes, fits, and designs to cater to this demand.

• Innovation and Technology: The industry is witnessing the adoption of new technologies, including automation, AI-based fabric pattern recognition, and advanced laser treatments, to improve production efficiency, reduce waste, and enhance product quality.

• Customisation: Personalised denim offerings — customised fits, finishes, and designs, are becoming more popular, driven by both online retailers and local brands.

Challenges

• Price Sensitivity: Despite the growing demand for premium denim, price sensitivity remains a key challenge, particularly in tier-2 and tier-3 cities.

• Competition: The Indian denim industry faces competition from both domestic and international brands.

• Supply Chain and Labour Issues: Disruptions in the supply chain and labour-related challenges can impact production.

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The Indian shirt industry, a significant component of the broader textile and apparel sector, contributes substantially to Indias GDP, industrial production, and exports. In F.Y 2024-2025, it navigated a dynamic landscape shaped by global trends, domestic consumption patterns, and government initiatives. The revenue generated in the Indian shirts market amounts to US$8.24 billion and is projected to grow at a CAGR of 3.08% from 2025 to 2029. The resurgence of in-office work culture, coupled with increased social outings post-pandemic, contributed to a rise in purchases of both formal and lifestyle-oriented shirts.

Moreover, Tier 2 and Tier 3 cities emerged as key growth drivers, reflecting the rising aspirational spending patterns and expanding middle class. Conversely, the Indian shirt industry will also need to navigate challenges related to rising costs and fluctuating demand; face intense competition from other low-cost manufacturing countries, such as Bangladesh and Vietnam.

Outlook: The long-term outlook for the industry remains positive, supported by evolving consumer trends, increasing domestic consumption, and strategic government initiatives.

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OPPORTUNITIES

1. Sustainability and Eco-Friendly Textiles

Rising awareness of environmental concerns has led Indian textile firms to adopt organic and sustainable fabrics.

2. Government Initiatives and Policy Support

The Indian government continues strengthening the textile sector through various supportive measures such as the Production Linked Incentive (PLI) scheme, the Make in India campaign, and tax benefits for exporters.

3. Technological Advancements and Digital Integration

The integration of automation, AI-driven quality control, and smart textile innovations is revolutionising the industry. Digital tools are streamlining supply chains, improving operational efficiency, and enhancing customer engagement. Additionally, the rise of e-commerce has created new direct-to-consumer avenues for textile brands.

4. Export Potential and Global Market Demand

India remains a major player in global textile exports. As international demand grows for cost-effective yet high- quality textile products, Indian manufacturers have the opportunity to expand their reach. Free trade agreements and the reorganisation of global supply chains offer further potential for growth in overseas markets.

CHALLENGES

1. Supply Chain Disruptions and Rising Raw Material Costs

Fluctuating key raw material prices continue to challenge production planning and profitability. Additionally, global supply chain disruptions, influenced by geopolitical factors and climate-related events, threaten material availability and cost stability.

2. Labour Shortages and Skill Gaps

Despite having a large workforce, the industry faces a shortage of skilled labour, particularly in advanced textile technologies.

3. Intense Global Competition

Countries like Bangladesh and Vietnam have become formidable competitors in textile exports due to their lower labour costs and advantageous trade agreements.

4. Environmental Compliance and Regulatory Pressures

As global sustainability standards become stricter, textile businesses must adapt quickly to meet environmental regulations.

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The Indian cotton yarn industry is anticipated to grow by 7-9% in F.Y 2025-2026, indicating a robust recovery from the modest 2-4% growth in F.Y 2024-2025. This recovery is driven by improved export demand, particularly from China, alongside stable domestic consumption.

Exports, which contribute approximately 30% of the industrys revenue, are projected to increase by 9-11% as demand from China returns to normal following last years decline. In the domestic market, demand from garments and home textiles is likely to support growth in volumes of 4-6%.

Raw material availability remains stable, backed by the Cotton Corporation of Indias active procurement, helping control inventory losses and ensure smooth operations. Operating margins will likely expand, aided by stable cotton yarn spreads and lower input cost volatility.

However, the industry remains vulnerable to global trade policy changes, demand fluctuations from key markets such as the U.S., and volatility in domestic cotton prices. Despite these challenges, the long-term outlook remains positive, supported by moderate capex plans, disciplined working capital management, and Indias favourable position in global textile markets.

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INDIAN ELECTRIC VEHICLE MARKET

The Indian electric vehicle (EV) market demonstrated strong growth in F.Y 2024-2025, marked by significant sales increases across all segments. Cumulative EV sales reached approximately 6.17 million units by the end of F.Y 20242025, with annual sales surpassing 2 million units.

Electric two-wheelers (E2Ws) led the charge, accounting for over 50% of the market, driven by increasing consumer preference for cost-effective and eco-friendly urban mobility solutions. Passenger electric three-wheelers (E3W-P) followed, holding around 36% of the market share, reflecting their growing adoption in both passenger and cargo segments.

The Government of Indias continued push through initiatives such as the FAME II scheme, PLI for Advanced Chemistry Cell (ACC) battery storage, and various state-level EV policies contributed substantially to market expansion. Moreover, the emphasis on local manufacturing and localisation of EV components has strengthened the domestic supply chain and reduced dependency on imports.

Despite the positive momentum, the sector continues to face key challenges, such as the lack of standardised charging protocols, supply chain constraints for critical minerals, and limited awareness in tier-2 and tier-3 cities.

Looking ahead, F.Y 2025-2026 is expected to accelerate the EV transition, with deeper penetration across commercial fleets, last-mile delivery, and rural mobility segments.

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JWLS APPROACH TO RISK MITIGATION AND STRATEGIES

JWLs risk management philosophy is rooted in proactively identifying, assessing, and mitigating potential risks to safeguard stakeholder value. It adopts an integrated risk management framework aligned with industry best practices, enabling informed decision-making and strategic resilience. This approach ensures that risks are managed systematically across all levels of the organization.

INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

An independent internal audit function is vital to JWLs internal control framework. The Company has instituted a robust and comprehensive system of internal controls, specifically engineered to guarantee the accuracy and reliability of financial data, in addition to the integrity of records employed in the preparation of financial statements and other reports. This system facilitates the prudent management of assets and is customised to the scale and complexity of JWLs operations.

JWL is dedicated to upholding this framework to ensure reasonable assurance that all transactions are executed with appropriate managerial authorisation. The internal control system is further fortified by a comprehensive internal audit programme, which is regularly evaluated by senior management and guided by meticulously documented policies, procedures, and guidelines.

Internal audit findings play a crucial role in identifying and assessing risks. In addition, both Management and the Audit Committee conduct periodic evaluations of business risks to proactively address significant challenges that could impact the achievement of the Companys strategic objectives. These controls also help ensure that all transactions are properly recorded and financial statements are prepared in accordance with established accounting standards. Moreover, they help safeguard the Companys assets against any significant misuse or loss.

ENVIRONMENT, HEALTH AND SAFETY (EHS)

JWL places significant emphasis on long-term sustainability, which is grounded in a comprehensive Environment, Health, and Safety (EHS) program. Recognising the potential regulatory and reputational implications of EHS incidents, the Company is dedicated to promoting a safe, healthy, and responsible work environment.

COMMITMENT TO EMPLOYEE SAFETY

Comprehensive Training: JWL promotes a safety culture through targeted awareness workshops, providing employees with the knowledge and tools to navigate production operations safely and effectively.

Proactive Risk Management: The Company adopts a forward-looking approach to mitigate potential risks, implementing preventive measures to achieve its EHS objectives.

RESPONSIBLE CORPORATE CITIZENSHIP

Environmental Stewardship: JWL actively addresses environmental challenges through initiatives focused on energy efficiency, water conservation, reduced chemical usage, and responsible waste management.

Regulatory Compliance and Sustainability: Full compliance with EHS regulations is a top priority, ensuring that operations and products align with the highest environmental protection standards and occupational health and safety.

Community Engagement: With a deep commitment to environmental preservation and social responsibility, JWL supports the well-being of surrounding communities, embedding these values into its business practices.

BUILDING A SUSTAINABLE FUTURE

Enhancing Shareholder Value: JWLs EHS initiatives strengthen brand reputation and cultivate investor confidence through responsible and transparent operations.

Stakeholder Engagement: By demonstrating a steadfast commitment to environmental and social responsibility, JWL nurtures strong relationships with diverse stakeholder groups.

Environmental Protection: The Companys approach to sustainable resource management contributes to safeguarding the planet for future generations.

JWLs dedication to EHS reflects its leadership in sustainable development, underscoring a long-term vision that benefits employees, communities, and the environment alike.

HUMAN RESOURCE MANAGEMENT

JWL views its employees as its most valuable asset, recognising that their collective expertise, skills, and knowledge are crucial for the Companys progress and the cultivation of an agile, high-performing culture. JWL is dedicated to establishing a supportive work environment that nurtures employee engagement and a strong sense of purpose. This empowers individuals to make significant contributions to the Companys achievements while also experiencing personal satisfaction in their roles.

Prioritising inclusivity and diversity, JWL cultivates a safe and welcoming workplace for everyone. The Companys human resource policies are carefully aligned with its overarching business strategy, playing a vital role in achieving operational excellence. Recognising that a well-trained and motivated workforce is essential for reaching strategic goals, JWL strongly emphasises employee retention. This is accomplished through a thorough process of talent identification and placement, ensuring that individuals are matched with roles that utilise their strengths and align with their career ambitions.

WAY FORWARD

The Company has consistently embraced a learning-driven approach, turning past challenges into stepping stones for sustainable growth. Over the last year, this philosophy has yielded tangible results, marking significant milestones in our journey. As we move forward, the Company remains strategically focused on enhancing profitability and unlocking new growth avenues. Our roadmap includes expanding into new geographies and product segments, strengthening organizational capabilities, scaling core operations, and advancing our commitment to responsible and sustainable business practices