The global economy demonstrated resilience during FY 2026-27, supported by overall growth moderated amid heightened uncertainty. The year was marked by escalating trade tensions, the imposition of tariffs, and geopolitical conflict - particularly in the Middle East - which together contributed to volatility in energy markets and disruption across global supply chains. Uncertainty surrounding key trade routes, including the Strait of Hormuz, led to fluctuations in oil prices, freight costs, and insurance premiums, weighing on global business sentiment through the year.
According to the International Monetary Fund (IMF), global growth is projected at 3.1% in 2026, with a marginal improvement to 3.2% in 2027, under a scenario in which the conflict remains contained.
For Karnika Industries Limited, this global backdrop carries direct relevance: as a manufacturer serving both domestic and export markets, the Company remains attentive to movements in input costs, freight and logistics expenses, and shifts in global demand that stem from this wider economic environment.
Indias economy sustained a robust growth trajectory through FY 2025-26, underpinned by supportive domestic conditions - namely, moderating inflation, accommodative monetary policy, and continued public capital expenditure. Inflation remained well within comfortable levels for much of the year, serving as a key anchor of macroeconomic stability. While price pressures are expected to firm modestly in the closing months of the fiscal year on account of base effects, underlying inflation is assessed to remain contained.
According to the Press Information Bureau (PIB), real GDP is estimated to have grown 7.4% in FY26, propelled by strong consumption and investment activity, and reaffirming Indias standing among the worlds fastest-growing major economies. Manufacturing and services continued to anchor this growth, with manufacturing output rising 8.4% in the first half of the fiscal year. Within the textile sector, sustained domestic demand and supportive policy measures underpinned performance, with Indias textile exports rising 2.1% to reach ?3.2 lakh crore in FY26, despite continuing uncertainty in global trade.
Looking ahead, the outlook for FY27 remains constructive, with GDP growth projected in the range of 6.8% to 7.2%, supported by strengthening domestic demand, sustained public capital investment, and the continued pursuit of structural reform.
Source: International Monetary Fund; Press Information Bureau
The global textile industry remains a key pillar of the international manufacturing ecosystem, underpinned by strong linkages with the apparel, home furnishing, and industrial sectors. The industry has demonstrated steady growth and is expected to expand from USD 660.1 billion in 2025 to USD 703.0 billion in 2026, growing at a CAGR of approximately 7% to reach USD 919.1 billion by 2030 - a trajectory that continues to support demand for garment manufacturers such as the Company.
This growth is driven by rising disposable incomes, urbanisation, and evolving consumer preferences, particularly within the Asia-Pacific region, which accounts for nearly half of global textile consumption and production, and where the Companys manufacturing base is located. The industry has, however, faced heightened volatility on account of macroeconomic pressures and shifting global trade dynamics. Ongoing geopolitical tensions between the United States and China have led to the imposition of tariffs on textile and apparel products, prompting global brands to diversify sourcing away from traditional hubs. This shift has resulted in the diversification of supply chains, with countries such as India, Bangladesh, Indonesia, Thailand, and Sri Lanka gaining prominence as alternative manufacturing bases - a trend that directly benefits India-based garment manufacturers positioned to absorb this reallocation of sourcing. Despite near-term challenges arising from tariffs and trade disruption, the long-term outlook remains positive, supported by favourable demographics, rising per capita consumption, and continued technological advancement.
Source: The Business Research Company
Indias textile industry remains a key manufacturing sector, driven by a large domestic consumption base, a diversified product portfolio, and a growing presence in global trade - the very ecosystem within which the Company operates as a kidswear-focused garment manufacturer. The Indian textile market recorded a CAGR of approximately 6% over FY22-26, driven by robust growth in the apparel segment and steady domestic demand. The sector contributes approximately 2% to Indias GDP and is expected to nearly double its share to approximately 5% by 2030.
While the year began with healthy export growth, tariff changes introduced in August reshaped the global competitive landscape; nonetheless, India sustained its position in key export markets, supported by its established manufacturing capabilities and continued policy support. Government initiatives - including export incentives under RoDTEP and RoSCTL, GST rationalisation, and infrastructure development through initiatives such as PM MITRA Parks - continue to strengthen the competitiveness of manufacturers such as the Company. Further, the allocation of ?5,279.01 crore to the Ministry of Textiles under the Union Budget FY26-27 is expected to provide additional support to the industry. According to IMARC, the Indian textile market is projected to reach USD 213.75 billion by 2034. With a favourable policy environment and a growing focus on scale and efficiency, the industry - and the Company within it - remains well positioned for sustained long-term growth.
Source: India Brand Equity Foundation (IBEF)
Indias textile industry continues to demonstrate strong export performance, supported by rising global demand, competitive production costs, and a diversified presence across international markets. During FY26 (April-December 2025), Indias textile and apparel exports stood at USD 27,312.7 million, with growth recorded across more than 100 global destinations.
Indias textile exports have reached ?3 lakh crore, and the Government aims to triple this figure to ?9 lakh crore by 2030 through the strengthening of domestic manufacturing capabilities and the expansion of Indias global reach - an ambition that creates meaningful headroom for established garment manufacturers to scale export volumes.
Trade agreements are expected to further enhance Indias export competitiveness. The India-UK Free Trade Agreement, signed in July 2025, provides duty-free access for Indian textile exports, helping close the 10-12% tariff gap with competing exporters. This is expected to boost Indias textile exports to the UK from USD 1.79 billion to as much as USD 5 billion, benefiting labour-intensive categories such as garments and home textiles - directly relevant to the Companys own product categories - while supporting traditional clusters and export hubs such as Tirupur.
Source: India Brand Equity Foundation (IBEF)
The global apparel industry has witnessed modest growth over the past decade, with exports increasing from USD 470 billion in 2014 to USD 546 billion in 2025. Apparel remains the dominant segment, contributing nearly 60% of global textile and apparel trade - the category in which the Company operates.
The global apparel sourcing landscape is undergoing a structural shift, as brands diversify supply chains beyond China to enhance resilience and manage rising compliance and geopolitical considerations. This has created opportunities for emerging manufacturing hubs, including Bangladesh, Vietnam, India, and Indonesia. Countries with favourable trade agreements, robust manufacturing infrastructure, and efficient supply chains are well positioned to benefit, and Indian garment manufacturers with established compliance and quality systems - such as the Company - stand to gain disproportionately.
Source: Motilal Oswal Thematic Report
In FY26, Indias textile and apparel industry witnessed a gradual shift from volume-led growth towards value-added categories, supported by rising domestic demand and evolving trade dynamics - a shift consistent with the Companys own focus on design-led, branded kidswear rather than pure volume manufacturing. The Indian textile and apparel industry is valued at USD 194 billion in FY26, including exports of USD 37 billion. On the export front, India ships to more than 100 countries, with the United States, the European Union, and the United Kingdom accounting for the top three import destinations. Together, the US and EU represent the largest textile and apparel export markets for India, with a combined share of approximately 47% of exports. While India currently accounts for approximately 4-5% of global apparel trade, this indicates significant headroom for market share expansion as global brands diversify sourcing beyond China and increasingly favour large-scale, compliant suppliers - positioning manufacturers with established infrastructure, such as the Company, to capture a growing share of this reallocation.
Additionally, India has signed trade agreements with the United States, the United Kingdom, and the UAE, which are expected to boost exports going forward by providing a competitive edge over other exporting countries. Looking ahead, the Government of India has set an ambitious target to scale the textile market to USD 350 billion by 2030, up from USD 194 billion in FY26 - implying a CAGR of approximately 13%, driven by strong export growth of approximately 22% CAGR alongside steady domestic demand.
Source: Motilal Oswal Thematic Report; Ministry of Textiles, MOFSL
Karnika Industries Limited is a leading manufacturer and exporter of kids wear, with a strong focus on sustainability and operational excellence. The company operates a vertically integrated manufacturing garmenting, enabling consistent quality, cost efficiency, and supply chain reliability. The Company core business is anchored by its garment division, which specializes in infant wear and childrens apparel for global markets. The company caters to a diversified international customer base across the Middle East, supported by long-standing relationships and high compliance standards.
Beyond its core export business, the Company has acquired Kidcity Solutions Private Limited which enabled its entry into the D2C/SIS Model sector in the garment industry. In the domestic market, the Company operates established brands such as Karnika Care, Karnika Cool, Karnika Qube, Karnika Life, Karnika
Key and Karnika Club. In FY2025-26, the Company focused on strengthening its manufacturing capabilities and global footprint.
Karnika Industries Limited is committed to promoting employee well-being, continuous learning, and workplace diversity. The company supports personal and professional growth through structured upskilling programs and wellness initiatives. By fostering an entrepreneurial culture, the Company empowers employees to take ownership, drive innovation, and contribute meaningfully to organizational success.
Cotton remains the key raw material for the textile industry, and fluctuations in cotton prices can impact realizations and profitability. The Company mitigates this risk through prudent sourcing practices, efficient inventory management, and continuous operational improvements.
India has seen variable inflation trends historically. While fluctuations in inflation rates can present challenges in forecasting and managing our costs, they also encourage us to enhance our financial strategies and cost management practices. If there is an uptick in the cost of raw materials due to inflationary trends, or a rise in employee benefit payments driven by inflation in India, we are committed to implementing innovative measures to absorb these costs effectively. Our goal is to minimize the impact on our customers and maintain the integrity of our business operations.
Ensuring a safe and healthy working environment for everyone is vital for boosting productivity and nurturing organisational development. We are equipped the workplace with the necessary safety equipment and keep all the machinery in good working order through regular maintenance and safety inspections.
We evaluate and manage credit risk on the basis of assumptions and factors influenced by market conditions. To mitigate credit risk, we diligently track the creditworthiness of debtors through internal systems that are configured to define credit limits of customers.
Adjustments to regulations and government incentives present opportunities for the company to adapt and innovate, potentially enhancing its business and profitability. The Indian government has historically supported the textile sector with incentives such as RoSCTL and EPCG fostering production and export growth. While these incentives may evolve, the company is poised to leverage its operational strength to maintain and improve its market position.
In FY 2025-26, your company has recorded revenue of Rs. 22428.14 Lakhs as against Rs. 17254.85 in FY 2024-25 with EBITDA stood as Rs. 4360.80 Lakhs in FY 2025-26 as against Rs. 2976.36 in FY 2024-25. PAT was Rs. 2667.73 Lakhs in FY 2025-26 as against Rs 1803.05 Lakhs in FY 2024-25. EPS for FY 2025-26 was Rs. 6.41 in FY 2025-26 as against Rs. 14.54 in the FY25.
In FY 2025-26, your company has recorded a consolidated revenue of Rs. 24847.90 Lakhs, EBITDA stood as Rs. 4594.30 Lakhs, PAT was Rs. 2838.66 Lakhs and EPS for FY 2025-26 were Rs. 6.72.
The companys internal control systems for financial reporting are robust and are commensurate with its size and its industry sectors. These systems ensure efficiency and productivity at all levels, while safeguarding your companys assets. Stringent procedures are in place to ensure high accuracy in recording and providing consistent financial and operational support.
Business operations are closely monitored by the internal team and the Management. The Board is promptly notified in case of any deviations. To ensure seamless growth, risk identification & assessment and mitigation strategies are designed and continuously recalibrated on the basis of these findings.
As per provisions of SEBI Listing Regulations, 2015, the significant financial ratios (calculated on standalone basis) are given below:
| Particulars | 2025-26 | 2024-25 | % Change | Explanation |
| Debtors Turnover | 3.16 | 2.74 | 15.33% | N.A. |
| Inventory Turnover | 3.44 | 2.76 | 24.64% | N.A. |
| Interest Coverage Ratio | 8.01 | 6.66 | 20.27% | N.A. |
| Current Ratio | 1.69 | 1.68 | 0.60% | N.A. |
| Debt to Equity Ratio | 0.73 | 0.85 | -14.12% | N.A. |
| Operating Profit Margin (%) | 13.33% | 11.85% | 12.49% | N.A. |
| Net Profit Margin (%) | 11.89% | 10.45% | 13.78% | N.A. |
| Return on Net worth (%) | 24.95% | 21.82% | 14.34% | Increase in Profit |
Eleven-plus garment categories, spanning shorts, joggers, capris, tees, rompers, sleep suits, winter wear, infant wear, fancy suits, girls separates, and jumpsuits, sit under one manufacturing roof, letting a single retailer source nearly its entire kidswear order from Karnika alone
ISO 14001:2015 certification covers the Howrah facilities end to end, design, sampling, quality checks, ironing, and packing, all run through a job-work model that keeps the process tight
Niranjan Mundhra has led the Company as Managing Director through a period of sustained growth, giving strategic decisions continuity rather than turnover-driven disruption
Revenue climbed from 17,255 Lakhs in FY 2024-25 to 22,428 Lakhs in FY 2025-26, a jump of nearly 30 percent, while net profit rose from 1,803 Lakhs to 2,668 Lakhs over the same period.
Return on equity has stayed strong, averaging around 35 percent across the past three years, with the trailing twelve months figure near 29 percent, a sign of efficient capital use
More than 2,500 clients, spanning retailers and commission agents, keep coming back, a base built on consistent delivery
Debtor days increased to 158 days, and cash conversion cycle remains elevated (~269 days), suggesting potential liquidity strains.
All manufacturing currently sits in Howrah, so any disruption local to that region carries outsized risk, and geographic scale-up would mean building fresh capacity elsewhere.
Exports make up a small slice of total business today, leaving the international opportunity mostly untouched.
Urban incomes are rising, e-commerce keeps expanding, and parents increasingly want customization, three forces pushing kidneywear demand higher across the country
Southeast Asia, the Middle East, and Western markets sit largely outside Karnikas current export reach, representing real white space
PLI Scheme incentives and the PM MITRA Parks initiative give the Company government-backed paths toward cheaper expansion and a sturdier supply chain
Selling direct through e-commerce, private labels, and social media would cut out intermediaries and could lift margins meaningfully
Automation, ERP tools, digital design software, and analytics remain only partly adopted, leaving room to run leaner and respond faster
Tariff changes, including potential U.S. duties on textiles, alongside broader geopolitical and supply chain disruption, could hit export economics without warning
Cotton and synthetic fabric costs move with global markets, and a spike there falls straight through to margins
Organized manufacturers with scale and a large field of nimble local players both compete hard for the same customers
Working capital pressure, driven by elevated receivables, could tighten cash flow further if broader market conditions turn
Karnika Industries runs a profitable, well-managed kidneywear business today. Its next stretch of growth will likely hinge on how well it builds export relationships, tightens working capital, and adds manufacturing capacity beyond its current footprint.
Brief outline on CSR policy of the Company
Karnika Industries Limited (the Company) has implemented CSR measures to ensure long-term economic performance, environmental stewardship, and social responsibility. The Company works with society beyond business because it thinks that a good business must have a greater impact in creating a better future for the communities in its environment. The company strives to end malnutrition, improve healthcare facilities, support primary education, rehabilitate abandoned women and children, animal welfare and preserve Indian art and culture. The Companys focus has always been on contributing to the long-term growth of society and the environment, as well as making our world a better place for future generations
| Name of Director | Designation / Nature of Directorship | Number of meetings of CSR Committee held during the year | Number of meetings of CSR Committee attended during the year |
| Mr. Mahesh Kumar Mundhra | Whole-Time Director | 2 | 2 |
| Mr. Yash Jhawar | Independent Director | 2 | 1 |
| Mrs. Kirti Taparia | Independent Director | 2 | 2 |
| Mrs. Kirti Mundhra | Director | 2 | 2 |
| Mr. Suraj Kumar Singh | Independent Director | 2 | 1 |
Mr. Suraj Kumar Singh resigned on 11.02.2026.
The Company Secretary and Compliance Officer of the Company acts as the secretary to the CSR Committee.
During the year, the Committee reviewed and recommended to the Board the CSR Policy, CSR Activities, CSR Budget, and expenditures for Fiscal Year 2025-26. During the year, the Board adopted all the Committees recommendations.
Corporate Social Responsibility Policy is available on the website of the Company at
Provide the web-link where Composition of CSR Committee, CSR Policy and CSR Projects approved by the Board are disclosed on the website of the company.
Composition of CSR Committee and CSR Policy are disclosed at
Provide the executive summary along with web-link(s) of Impact Assessment of CSR Projects carried out in pursuance of sub-rule (3) of rule 8, if applicable: Not Applicable
(a) Average net profit of the company as per sub-section (5) of section 135: Rs. 1,586.46 Lakhs (b) Two percent of average net profit of the company as per sub-section (5) of section 135: Rs. 31.73 Lakhs (c) Surplus arising out of the CSR projects or programs or activities of the previous financial years: Rs. 0.52 Lakhs
(a) Amount spent on CSR Projects (both Ongoing Project and other than Ongoing Project): Rs. 32.00 Lakhs (b) Amount spent on Administrative Overheads: Rs. 0.00 (c) Amount spent on Impact Assessment, if applicable: Rs. 0.00 (d) Total amount spent for the Financial Year [(a)+(b)+(c)]: Rs. 32.00 Lakhs (e) CSR amount spent or unspent for the financial year:
| Total Amount Spent for the Financial Year | Amount Unspent | ||||
| Total Amount transferred to Unspent CSR Amount as per sub-section (6) of section 135 | Amount transferred to any fund specified under Schedule VII as per second proviso to sub-section (5) of section 135 | ||||
| Amount | Date of transfer | Name of the Fund | Amount | Date of Transfer | |
| Rs.32.00 Lakhs | 0.00 | NA |
(f) Excess amount for set off, if any:
| Sr. Particulars | Amount (Rs. In Lakhs) |
| (1) (2) | (3) |
| (i) Two percent of average net profit of the company as per sub-section (5) of section 135 | 31.73 |
| (ii) Total amount spent for the Financial Year | 32.00 |
| (iii) Excess amount spent for the Financial Year [(ii)-(i)] | 0.27 |
| (iv) Surplus arising out of the CSR projects or programs or activities of the previous Financial Years, if any | 0.52 |
| (v) Amount available for set off in succeeding Financial Years [(iii)-(iv)] | 0.79 |
Details of Unspent Corporate Social Responsibility amount for the preceding three Financial Years:
| 1 2 | 3 | 4 | 5 | 6 | 7 | 8 | |
| Sl. No. Preceding Financial Year(s) | Amount transferred to Unspent CSR Amount sub-section (6) of section 135 | Balance Amount in Unspent CSR Amount sub-section (6) of section 135 | Amount Spent in the Financial Year (in Lakhs) | Amount transferred to a Fund as specified under Schedule VII as per second proviso to sub-section (5) of Section 135, if any | Amount remaining to be spent in succeeding Financial Year | Deficiency, if any | |
| Amount | Date of Transfer | ||||||
| 1 000 | 32.00 lakhs | - | 00 |
Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year: No
If yes, enter the number of Capital assets created/ acquired: Not Applicable
Furnish the details relating to such asset(s) so created or acquired through Corporate Social Responsibility amount spent in the Financial Year:
| Sl. No. Short particulars of the property or asset(s) [including complete address and location of the property] | Pin code of the property or asset(s) | Date of creation | Amount of CSR amount spent | Details of entity/ Authority/ beneficiary of the registered owner | ||
| CSR Registration Number, if applicable | Name | Registered Address | ||||
| 1 2 | 3 | 4 | 5 | 6 | ||
| Not Applicable |
Specify the reason(s), if the company has failed to spend two per cent of the average net profit as per section 135(5): Not Applicable
For and on behalf of Board of Directors of Karnika Industries Limited
Sd/- Mahesh Kumar Mundhra Chairman of CSR Committee DIN:08577538 Date:08.09.2026 Place:Howrah
Sd/- Niranjan Mundhra Managing Director DIN:05254448
The Ratio of the remuneration paid to each Director during the year to the median remuneration of the employees of the Company for the FY 2025-26 is as under
| Sr. No. | Name of Director | Designation | Ratio to the Median | % increase of remuneration in FY 2025-26 as compared to FY 2024-25 |
| 1 | Niranjan Mundhra | Managing Director | 201.74 | 25.00% |
| 2 | Shiv Shankar Mundhra | Whole-Time Director | 201.74 | 25.00% |
| 3 | Mahesh Kumar Mundhra | Whole-Time Director | 201.74 | 25.00% |
| 4 | Krishan Kumar Karnani | Chief Financial Officer | N.A. | N.A. |
| 5 | Muskan Bubna (Formerly Muskan Mundhra) | Company Secretary | N.A. | N.A. |
Note:
a. The Non-Executive Directors of the Company are entitled for sitting fees as per the statutory provisions and within the limits approved by the Members. The details of sitting fees paid to the Non-Executive Directors are provided in the Report on Corporate Governance.
There was an increase of 4.96% in the median remuneration of employees during FY 2025-26.
There were 85 permanent employees on the rolls of Company as on 31st March, 2026.
Average percentage increase made in the salaries of employees other than the Managerial Personnel in the financial year i.e. 2025-26 was 4.90% whereas the increase in the managerial remuneration for the same financial year was 22.86%.
Average increase in the remuneration of the employees other than the Managerial Personnel and that of the managerial personnel depends upon
It is hereby affirmed that the remuneration paid during the year ended 31st March, 2026 is as per the Nomination and Remuneration Policy of the Company.
For and on behalf of Board of Directors of Karnika Industries Limited
Sd/- Niranjan Mundhra Managing Director DIN: 05254448
Place: Howrah Date: 08.09.2026
Sd/- Mahesh Kumar Mundhra Whole-Time Director DIN: 08577538
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