Prospective investors should read the following discussion of our financial condition and results of operations together with our Restated Financial Information, which are included in Restated Financial Information on page 265, along with Industry Overview and Our Business on pages 135 and 183, respectively.
This section contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in such forward-looking statements. For details, see Forward-Looking
Statements on page 21.
All references in this section to a particular Financial Year or FY or Fiscal, unless stated otherwise, are to the 12-month period ended on March 31 of that particular calendar year.
We have included certain non-GAAP financial measures and other performance indicators relating to our financial performance and business in this section. Such measures and indicators are not standardized terms and hence a direct comparison of these measures and indicators between companies may not be possible. For further details, see Certain Conventions, Use of Financial Information and Market Data and Currency of Presentation Non-Generally Accepted Accounting Principles on page 19.
Unless otherwise indicated, industry and market data used in this section have been derived from the industry report titled Engineered Fabrics Industry Report dated June 21, 2026 (the 1Lattice Report) prepared and issued by Lattice Technologies Private Limited (Lattice). Our Company commissioned Lattice to prepare the Lattice Report specifically for the purpose of the Offer for an agreed fee pursuant to the engagement letter dated February 3, 2025. The data included herein includes excerpts from the 1Lattice Report and may have been reordered by us for the purpose of presentation. There are no portions of or data or information in the 1Lattice Report that may be relevant for the proposed Offer that have been omitted or changed in any manner. For more details on the 1Lattice Report, see Certain Conventions, Use of Financial Information and Market Data and Currency of Presentation Industry and market data on page 19. A copy of the 1Lattice Report is available on our Companys website at https://www.kusumgar.com/investor-relations/home/ from the date of this Red Herring Prospectus until the Bid / Offer Closing Date.
OVERVIEW
For an overview of our business, ?? Our Business Overview on page 183.
SIGNIFICANT FACTORS AFFECTING OUR RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Our results of operations have been, and will be, affected by many factors. The following is a discussion of certain factors that have had, and we expect will continue to have, a significant effect on our results of operations and financial condition.
Geopolitical developments, resulting in heightened defence spending globally and stronger demand across defence related market segments
We manufacture products primarily for four diverse market segments:
(i) Aerospace and Defence Fabrics;
(ii) Aerospace and Defence Solutions;
(iii) Industrial and Automotive Fabrics; and (iv) Outdoor and Lifestyle Fabrics. For more details, see Our Business - Overview on page 183. The following table sets forth our revenue from contracts with customers from these four market segments, and from sales falling outside of those four market segments, for the fiscal years indicated.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | ||||
| Particulars | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers |
| Aerospace and Defence Fabrics | 2,136.99 | 31.67% | 3,700.92 | 48.06% | 3,134.88 | 68.79% |
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | ||||
| Particulars | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers |
| Aerospace and Defence Solutions | 1,550.17 | 22.97% | 2,219.02 | 28.81% | 8.64 | 0.19% |
| Industrial and Automotive Fabrics | 1,648.60 | 24.43% | 1,126.34 | 14.63% | 1,113.86 | 24.44% |
| Outdoor and Lifestyle Fabrics | 1,253.15 | 18.57% | 569.00 | 7.39% | 291.65 | 6.40% |
| Other Sales (1) | 159.23 | 2.36% | 85.67 | 1.11% | 7.92 | 0.17% |
| Revenue from contracts with customers | 6,748.14 | 100.00% | 7,700.95 | 100.00% | 4,556.94 | 100.00% |
Note:
(1) Revenue from other sales includes revenue from the sale of yarn and chemicals, revenue from job work undertaken for customers, as well as revenue from the sale of products and services outside of our four primary market segments.
Our revenue from Aerospace and Defence Fabrics decreased in Fiscal 2026 compared to Fiscal 2025 primarily due to a large order received in Fiscal 2025 that was not re-ordered in Fiscal 2026. We received 2,045.75 million from this order in Fiscal 2025 and 286.16 million from this order in Fiscal 2026. Our revenue from Aerospace and Defence Solutions decreased in Fiscal 2026 compared to Fiscal 2025 primarily due to the partial deferral of contract performance on a large contract due to operational requirements of the customer. In Fiscal 2026, we received an order with a contract value of 2,371.96 million, of which only 23.61% was executed in Fiscal 2026. We expect the remaining balance to be executed in Fiscal 2027.
The increase in revenue from our Aerospace and Defence Solutions market segment from Fiscal 2024 to Fiscal 2025 was primarily due to a single large order for Combat Free Fall (CFF) parachute systems from which 2,219.02 million was recognised as revenue from our Aerospace and Defence Solutions market segment for Fiscal 2025. This represented the entirety of our revenue from our Aerospace and Defence Solutions market segment for Fiscal 2025. CFF parachute systems were a new product introduced by us in Fiscal 2025. For more details, see Significant Factors Affecting our Results of Operations and Financial Condition Our Ability to Upgrade our Existing Products and Introduce New Products and Our Results of Operations Fiscal 2025 compared to Fiscal 2024 Income on pages 336 and 363, respectively.
The aerospace and defence industry is experiencing significant growth, driven by rising geopolitical tensions and a surge in defence spending globally ( source: 1Lattice Report ). The 1Lattice Report notes that global defence spending is projected to grow at a CAGR of approximately 5.1% from 2025 to 2030, to reach approximately US$ 3.7 trillion in 2030 ( source: 1Lattice Report ). Furthermore, the geopolitical tensions are accelerating investments in resilient, cutting-edge solutions and create a steady demand for specialised engineered fabrics and solutions ( source: 1Lattice Report ). Additionally, government policies supporting indigenous production are strengthening indigenous capabilities and ensuring long-term sustainability ( source: 1Lattice Report ).
The table below sets forth our revenue from contracts with customers from our four primary market segments, and from sales falling outside of those four market segments, for the fiscal years indicated and the percentage growth in such revenue from the previous fiscal years revenue.
| Particulars | Fiscal 2026 % growth from | Fiscal 2025 % growth from | Fiscal 2024 | ||
| in million | the previous Fiscal | in million | the previous Fiscal | in million | |
| Aerospace and Defence Fabrics | 2,136.99 | (42.26)% | 3,700.92 | 18.06% | 3,134.88 |
| Aerospace and Defence Solutions | 1,550.17 | (30.14)% | 2,219.02 | 25,583.10% | 8.64 |
| Industrial and Automotive Fabrics | 1,648.60 | 46.37% | 1,126.34 | 1.12% | 1,113.86 |
| Outdoor and Lifestyle Fabrics | 1,253.15 | 120.24% | 569.00 | 95.10% | 291.65 |
| Other Sales (1) | 159.23 | 85.86% | 85.67 | 981.69% | 7.92 |
| Revenue from contracts with customers | 6,748.14 | (12.37)% | 7,700.95 | 68.99% | 4,556.94 |
Note:
(1) Revenue from other sales includes revenue from the sale of yarn and chemicals, revenue from job work undertaken for customers, as well as revenue from the sale of products and services outside of our four primary market segments.
Increased demand from Indian customers driven by favourable global trade dynamics, including the shift towards a China + 1 sourcing strategy
The demand for our products from Indian customers increased primarily due to favourable global trade dynamics.
Favourable global trade dynamics included the shift towards a China + 1 sourcing strategy (due to factors such as trade tariffs and trade barriers impacting the price of imports from China), supply chain diversification by multinational corporations, and a broader shift by global buyers towards India as a sourcing hub. In particular, in respect of the China + 1 sourcing strategy, as companies seek to diversify their supply chains away from China, India has witnessed rapid development in industries such as electronics, pharmaceuticals, and automotive manufacturing ( source: 1Lattice Report ). Supporting this shift, the Production-Linked Incentive scheme has as of December 2025 attracted 2.1 trillion in investments across 14 sectors ( source: 1Lattice Report ).
The table below sets forth our revenue from contracts with customers from within India and outside India for the fiscal years indicated.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | ||||
| Particulars | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers |
| Within India | 4,049.70 | 60.01% | 5,912.88 | 76.78% | 3,389.51 | 74.38% |
| Outside India | 2,698.44 | 39.99% | 1,788.07 | 23.22% | 1,167.43 | 25.62% |
| Revenue from contracts with customers | 6,748.14 | 100.00% | 7,700.95 | 100.00% | 4,556.94 | 100.00% |
The table below sets forth our our revenue from contracts with customers from within India and outside India and the percentage growth in such revenue from the previous fiscal years revenue.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | |||
| Particulars | in million | % growth from the previous Fiscal | in million | % growth from the previous Fiscal | in million |
| Within India | 4,049.70 | (31.51)% | 5,912.88 | 74.45% | 3,389.51 |
| Outside India | 2,698.44 | 50.91% | 1,788.07 | 53.17% | 1,167.43 |
| Revenue from contracts with | |||||
| customers | 6,748.14 | (12.37)% | 7,700.95 | 68.99% | 4,556.94 |
Revenue from New Customers
Our revenue from new customers (which we define as customers in a fiscal year who were not our customers within the previous two fiscal years (New Customers)) has made a material contribution to our revenue for Fiscals 2026, 2025 and 2024. The table below sets forth our revenue from contracts with existing customers (which we define as customers in a fiscal year who were our customers within the previous two fiscal years (Existing Customers)) and revenue from contracts with New Customers and such revenue as a percentage of our revenue from contracts with customers.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | ||||
| Particulars | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers |
| Existing Customers | 5,495.67 | 81.44% | 5,312.27 | 68.98% | 1,966.90 | 43.16% |
| New Customers | 1,252.47 | 18.56% | 2,388.68 | 31.02% | 2,590.04 | 56.84% |
| Revenue from contracts with customer | 6,748.14 | 100.00% | 7,700.95 | 100.00% | 4,556.94 | 100.00% |
The table below sets forth our revenue from Existing Customers and New Customers and revenue from contracts with customers for the fiscal years indicated and the percentage increase in such revenue from the previous fiscal years revenue.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | |||
| Particulars | in million | % increase from the previous Fiscal | in million | % increase from the previous Fiscal | in million |
| Existing Customers | 5,495.67 | 3.45% | 5,312.27 | 170.08% | 1,966.90 |
| New Customers | 1,252.47 | (47.57)% | 2,388.68 | (7.77%) | 2,590.04 |
| Revenue from contracts with customer | 6,748.14 | (12.37%) | 7,700.95 | 68.99% | 4,556.94 |
Our Ability to Upgrade our Existing Products and Introduce New Products
We dedicate significant efforts and resources into research and development to upgrade our products and develop new products and these upgraded and new products have made a material contribution to our revenue from operations. The table below sets forth our revenue from new SKUs introduced during the fiscal year and our revenue from SKUs introduced in prior fiscal years, in each of the fiscal years indicated, and such revenue as a percentage of our revenue from contracts with customers.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | |||
| in million | % increase from the previous Fiscal | in million | % increase from the previous Fiscal | in million | |
| Revenue from new SKUs introduced during the Fiscal [A] | 2,042.96 | (28.67)% | 2,864.21 | 18.14% | 2,424.32 |
| Revenue from SKUs introduced in prior Fiscals [B] | 4,705.18 | (0.45)% | 4,726.22 | 156.96% | 1,839.27 |
The table below sets forth examples of the new types of products (i.e., a new type of product and not a variation of an existing product) we launched and from which we earned revenue in the periods indicated.
Particulars Type of new product
Fiscal 2026 Nil
Fiscal 2025 Combat Free Fall (CFF) parachute systems Fiscal 2024 Nil
Fiscal 2023 Infrared reflective fabric and fabric for extreme cold weather clothing
The table below sets forth our revenue from contracts with customers from each of the above listed new type of products.
| Fiscal 2026 | Fiscal 2025 | Fiscal 2024 | ||||
| Particulars | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers | in million | % of revenue from contracts with customers |
| Infrared reflective fabric and fabric for extreme cold weather clothing | - | - | 1,986.88 | 25.80% | 2,153.40 | 47.26% |
| Combat Free Fall (CFF) parachute systems | 639.57 | 9.48% | 2,225.88 | 28.90% | - | - |
| Revenue from contracts with customers | 6,748.14 | 100.00% | 7,700.95 | 100.00% | 4,556.94 | 100.00% |
Cost of Materials Consumed and Changes in Inventories of Finished Goods and Semi-Finished Goods
The cost of materials consumed and changes in inventories of finished goods and semi-finished goods together represent a significant percentage of revenue from our sale of products. The table below sets forth our cost of materials consumed, changes in inventories of finished goods and semi-finished goods, the total of the foregoing, and the total as a percentage of our revenue from sale of products for the fiscal years indicated.
| Particulars | Fiscal 2026 | Fiscal 2025 | Fiscal 2024 |
| in million, except percentages | |||
| Cost of materials consumed [A] | 3,081.66 | 3,713.71 | 2,002.86 |
| Particulars | Fiscal 2026 | Fiscal 2025 | Fiscal 2024 |
| in million, except percentages | |||
| Changes in inventories of finished goods and semi-finished goods [B] | (519.12) | (111.76) | (232.62) |
| Total [C = A + B] | 2,562.54 | 3,601.95 | 1,770.24 |
| Total as a percentage of sale of products [D = C/E] (%) | 41.17% | 46.86% | 38.94% |
| Sale of products [E] | 6,225.01 | 7,685.98 | 4,545.65 |
The prices of the raw materials we need are affected by numerous factors beyond our control, including, among others, trade policies, the price of oil, production capacity and transportation costs (source: 1Lattice Report) . Fluctuations in global demand and supply, and currency exchange rates further exacerbate the situation, as they influence the base prices of various raw materials (source: 1Lattice Report) .
If the prices of the raw materials we need rapidly increase, we may be unable to increase the prices for our products in sufficient time to fully offset increasing raw material prices. Our ability to transfer increases in raw material costs to our customers is dependent on, among others, market conditions as well as pricing of similar products by our competitors. In Fiscals 2026, 2025 and 2024, we have been successful in transferring increases in raw material costs to customers through increased prices, although there has typically been a time lag.
For details, see Our Business Strengths Our track record has given us access to technology and markets through partnerships. on page 189. We expect product upgrades and new products to make a meaningful contribution to our revenue from operations in the future.
Capacity utilisation and increase in production capacity
Given the nature of our business, our profitability is partially dependent on our ability to spread fixed production costs over higher production volumes. A higher capacity utilisation spreads fixed costs over more units, boosting margins, while low utilisation spreads fixed costs over fewer units, decreasing margins. At the same time, an increase in production capacity, even without a corresponding rise in capacity utilisation, can support profitability so long as margins on incremental sales exceed the additional fixed production costs. In such cases, the added capacity allows the Company to meet higher demand, reduce bottlenecks, and benefit from economies of scale as volumes increase over time.
The table below sets forth our aggregate installed capacity, actual production volume and capacity utilisation across all our manufacturing facilities for the fiscal years indicated:
| Metric | Fiscal 2026 | Fiscal 2025 (1) | Fiscal 2024 |
| Installed Capacity (2) (metres in million) | 161.97 | 147.52 | 66.58 |
| Actual Production (3) (metres in million) | 84.62 | 62.41 | 60.05 |
| Capacity Utilisation (4) (%) | 52.24% | 56.36% | 87.02% |
Notes :
(1) The Companys total installed capacity increased from 66.58 million metres as at March 31, 2024 to 147.52 million metres as at March 31, 2025 due to its commencement of operations at an additional manufacturing facility located at Block No. 172, Old Block No. 157, Kothwa, Taluka Mangrol, District Surat, on April 1, 2024 for scouring, dyeing, finishing, processing and coating nylon and polyester fabrics . The addition of this manufacturing facility also led to an increase in the Companys final output capacity from 48.86 million metres as at March 31, 2024 to 127.80 million metres as at March 31, 2025. While the Companys total installed capacity is the aggregate of installed capacity at all its factories, the Companys final output capacity is the aggregate of the installed capacity at its processing, dyeing, finishing, printing and coating factories. The capacity of weaving factories, which make up the remainder of the Companys factories, is not included in the Companys final output capacity as fabric that is only weaved is an intermediate product that is not sold. The Company only sells finished fabric, being fabric that has been processed, dyed, finished, printed and/or coated at one of its other factories.
(2) Installed capacity represents the installed capacity as of the last date of the relevant Fiscal. The installed capacity is based on various assumptions and estimates, including standard capacity calculation practice in the industry in which we operate. Assumptions and estimates taken into account for measuring installed capacities include 355 working days in a year.
(3) Actual production represents the quantum of production in the relevant Fiscal .
(4) Capacity utilization has been calculated on the basis of actual production in the relevant Fiscal divided by the installed capacity as at the end of such Fiscal.
For details regarding our installed capacity, actual production and capacity utilisation for Fiscals 2026, 2025 and 2024, see Our Business Manufacturing Capabilities on page 197.
Capital investments resulting in increases in depreciation
Capital investments and associated operating costs are related to the commissioning of new processing and weaving units.
| As at and for the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Depreciation and amortisation expense | 466.89 | 341.90 | 170.97 |
| Of which: | |||
| Depreciation of property, plant and equipment | 358.79 | 255.46 | 123.97 |
| Depreciation of property, plant and equipment as a percentage of sale of products | 5.76% | 3.32% | 2.73% |
| Sale of products | 6,225.01 | 7,685.98 | 4,545.65 |
Employee Benefits Expense
The table below sets forth our total number of employees as at the dates indicated and our employee benefits expense for the fiscal years indicated and as a percentage of revenue from operations.
| As at and for the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million, except as noted | |||
| Total number of employees | 1,051 | 1,058 | 866 |
| Employee benefits expense [A] | 881.86 | 655.73 | 414.85 |
| Employee benefits expense as a percentage of revenue from operations [B = A/C] (%) | 12.74% | 8.42% | 8.87% |
| Revenue from operations [C] | 6,920.03 | 7,789.97 | 4,679.08 |
Changes in Currency Exchange Rates
Although our Companys reporting currency is in Indian Rupees, we transact a portion of our business in several other currencies. Certain portions of our income and expenses are generated or incurred in other currencies and certain portions of our assets (trade receivables and cash and cash equivalents) and liabilities (trade payables) are in other currencies, such as USD and Euros.
The table below sets forth our total foreign currency receivables, total trade payables, total foreign currency borrowings, the total value of our outstanding forward contracts against net receivables and borrowings, and net gain/(loss) on foreign currency transactions as at and for the fiscal years indicated.
| As at and for the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million) | |||
| Total foreign currency trade receivables | 1,671.82 | 307.44 | 225.85 |
| Cash and cash equivalents in foreign currency | |||
| (In Exchange Earning Foreign Currency (EEFC) account and cash in hand) | 19.96 | 37.29 | 48.92 |
| Trade payables in foreign currency | 310.87 | 127.38 | 194.76 |
| Buyers Credit | - | 16.02 | - |
| Foreign currency borrowings (non-current) | - | - | - |
| Outstanding forward contracts against net receivables and borrowings | 142.97 | - | 714.56 |
| Net gain/(loss) on foreign currency transactions | 147.91 | 46.95 | 32.40 |
The exchange rates between the Indian Rupee and the currencies in which we receive payments for such exports, primarily the USD, have fluctuated in the past and our results of operations have been affected by such fluctuations in the past and may be impacted by such fluctuations in the future. Due to our inherent net foreign currency long position, depreciation of the Indian Rupee against foreign currencies will generally have a positive effect on our revenues and our results of operations and appreciation of the Indian Rupee against foreign currencies will generally have a negative effect on our revenues and our results of operations. There can be no guarantee that such fluctuations will not adversely affect our results of operations. However, the positive effect on depreciation of the Indian Rupee may not be sustained or may not show an appreciable effect on our results of operations in any given financial period due to other variables affecting our results of operations during the same period. Moreover, we expect that our cost of imported goods, such as raw materials, imported stores and spares, and other expenses incurred by us may rise during a sustained depreciation of the Indian Rupee against the USD.
Our exposure to the risk of changes in foreign exchange rates relates primarily to our operating activities (when revenue or expense is denominated in a different currency from our functional currency). We from time to time hedge a significant portion of our net foreign exchange exposure through forward contracts and foreign currency borrowings. We are exposed to foreign currency risk on the unhedged exposure of foreign currency translation of receivables and trade payables. For additional quantitative disclosures on foreign currency risk, see Restated Financial Information Note 48 Financial Risk Management Objectives and Policies (a) Market Risk (ii) Foreign Currency Risk on page 317.
KEY PERFORMANCE INDICATORS AND CERTAIN NON-GAAP MEASURES
In evaluating our business, we consider and use certain non-GAAP financial measures and key performance indicators that are presented below as supplemental measures to review and assess our operating performance. The presentation of these non-GAAP financial measures and key performance indicators are not intended to be considered in isolation or as a substitute for the Restated Financial Information. We present these non-GAAP financial measures and key performance indicators because they are used by our management to evaluate our operating performance. These non-GAAP financial measures are not defined under the Ind AS and are not presented in accordance with the Ind AS. The non-GAAP financial measures and key performance indicators have limitations as analytical tools. Further, these non-GAAP financial measures and key performance indicators may differ from the similar information used by other companies, including peer companies, and hence their comparability may be limited. Therefore, these matrices should not be considered in isolation or construed as an alternative to the Ind AS measures of financial performance or as an indicator of our financial condition, results of operations or cash flows.
For details of certain Ind AS financial measures, non-GAAP financial measures and statistical measures, see Our Business Overview and Basis for Offer Price Key Performance Indicators (KPIs) on page 183 and 118, respectively.
Reconciliation of Non-GAAP Financial Measures
The following table sets forth our EBITDA and EBITDA Margin, which are non-GAAP financial measures, for the fiscal years indicated.
| For the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Profit for the year | 982.00 | 1,119.88 | 843.96 |
| Less: Other income | 197.75 | 112.15 | 66.43 |
| Add: Total income tax expense | 367.58 | 387.95 | 306.75 |
| Finance costs | 259.78 | 146.31 | 63.22 |
| Depreciation and amortisation expense | 466.89 | 341.90 | 170.97 |
| EBITDA [A] | 1,878.50 | 1,883.89 | 1,318.47 |
| Revenue from operations [B] | 6,920.03 | 7,789.97 | 4,679.08 |
| EBITDA Margin [A/B] (%) | 27.15% | 24.18% | 28.18% |
Our EBITDA decreased by 0.29% to 1,878.50 million in Fiscal 2026 from 1,883.89 million in Fiscal 2025. This decrease was primarily due to the 12.31% decrease in our profit for the year to 982.00 million in Fiscal 2026 from 1,119.98 million in Fiscal 2025 and 76.33% increase in our other income to 197.75 million in Fiscal 2026 from 112.15 million in Fiscal 2025, which was partially offset by, amongst other things increase 77.55% in our finance costs to 259.78 million in Fiscal 2026 from 146.31 million in Fiscal 2025. For details on the reasons for the changes in the line items in the above table, see Our Results of Operations Fiscal 2026 compared to Fiscal 2025 on page 360.
Our EBITDA increased by 42.88% to 1,883.89 million in Fiscal 2025 from 1,318.47 million in Fiscal 2024. This increase was primarily due to the 32.69% increase in our profit for the year to 1,119.98 million in Fiscal 2025 from 843.96 million in Fiscal 2024, which increase was primarily due to an increase in our revenue from contracts with customers in each of our Aerospace and Defence Solutions and Aerospace and Defence Fabrics and market segments. Our revenue from Aerospace and Defence Solutions increased to 2,219.02 million for Fiscal 2025 from 8.64 million for Fiscal 2024. This increase was primarily due to a large order for Combat Free Fall (CFF) parachute systems, which was a new product introduced by us in Fiscal 2025. We recognised revenue of 2,225.88 million from this large order for Fiscal 2025, with 2,219.02 million of such revenue recognised as revenue under our Aerospace and Defence Solutions market segment. We generally do not have long-term agreements for the sale of any of our products, including for Combat Free Fall (CFF) parachute systems, so the revenue from this product in Fiscal 2025 may not be indicative of the revenue from this product in future fiscal years. Our revenue from Aerospace and Defence Fabrics increased by 18.06% to 3,700.92 million for Fiscal 2025 from 3,134.88 million for Fiscal 2024, which increase was primarily due to an increase in the volume of orders, as well as a change in our product mix. The increase in the volume of orders was primarily attributable to an increase in sales to customers in India, and not any singular large order. The change in product mix included increases in the sale of specialised military fabrics, the manufacturing of which involves advanced specifications, proprietary know how, and enhanced value addition, resulting in higher prices compared to legacy fabric offerings. For more details on the reasons for the changes in the line items in the above table, see Our Results of Operations Fiscal 2025 compared to Fiscal 2024 on page 363.
The following table sets forth our PAT Margin, which is a non-GAAP financial measure, for the fiscal years indicated.
| For the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Profit for the year (PAT) [A] | 982.00 | 1,119.88 | 843.96 |
| Total income [B] | 7,117.78 | 7,902.12 | 4,745.51 |
| PAT Margin [C = A/B] (%) | 13.80% | 14.17% | 17.78% |
The following table sets forth our Net Debt and Net Debt to EBITDA Ratio, which is a non-GAAP financial measure, as at the dates indicated.
| For the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Non-current borrowings | 851.19 | 757.64 | 348.05 |
| Current borrowings | 1,384.63 | 1,707.37 | 417.28 |
| Total Borrowings | 2,235.82 | 2,465.01 | 765.33 |
| Less: Cash and cash equivalents | 268.29 | 304.94 | 326.80 |
| Bank balances other than cash and cash equivalents | 212.32 | 106.93 | 1,106.13 |
| Net Debt [A] | 1,755.21 | 2,053.14 | (667.60) |
| EBITDA [B] | 1,878.50 | 1,883.89 | 1,318.47 |
| Net Debt to EBITDA Ratio [C = A/B] | 0.93 | 1.09 | (0.51) |
The following table sets forth our Return on Equity, which is a non-GAAP financial measure, for the fiscal years indicated.
| For the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Profit for the year (PAT) [A] | 982.00 | 1,119.88 | 843.96 |
| Equity share capital | 119.00 | 101.49 | 19.90 |
| Other equity | 4,910.59 | 2,476.03 | 1,383.69 |
| Opening total equity [B] | 2,577.52 | 1,403.59 | 556.14 |
| Closing total equity [C] | 5,029.54 | 2,577.52 | 1,403.59 |
| Average total equity [D = (B+C)/2] | 3,803.53 | 1,990.56 | 979.87 |
| Return on Equity [E = A/D] (%) | 25.82% | 56.26% | 86.13% |
The following table sets forth our Return on Capital Employed, which is a non-GAAP financial measure, for the fiscal years indicated.
| As at and for the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except percentages) | |||
| Profit before tax | 1,349.58 | 1,507.83 | 1,150.71 |
| Finance costs | 259.78 | 146.31 | 63.22 |
| EBIT [A] | 1,609.36 | 1,654.14 | 1,213.93 |
| Total assets | 9,050.72 | 6,323.98 | 5,847.41 |
| Less: Current liabilities | 2,549.88 | 2,466.90 | 3,674.59 |
| Capital Employed [B] | 6,500.84 | 3,857.08 | 2,172.82 |
| Return on Capital Employed (ROCE) [C = A/B] (%) | 24.76% | 42.89% | 55.87% |
The following table sets forth our Fixed Assets Turnover Ratio, which is a non-GAAP financial measure, for the fiscal years indicated.
| As at and for the year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except ratios) | |||
| Revenue from operations [A] | 6,920.03 | 7,789.97 | 4,679.08 |
| Opening property, plant and equipment [B] | 1,718.63 | 1,367.20 | 825.60 |
| Closing property, plant and equipment [C] | 2,356.68 | 1,718.63 | 1,367.20 |
| Average property, plant and equipment [D = (B+C)/2] | 2,037.66 | 1,542.91 | 1,096.40 |
| Fixed Assets Turnover Ratio [A/D] | 3.40 | 5.05 | 4.27 |
The following table sets forth our Net Working Capital Days, which is a non-GAAP financial measure, for the fiscal years indicated.
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| ( in million, except ratios) | |||
| Current assets | 5,332.20 | 3,112.59 | 3,623.41 |
| Current liabilities | 2,549.88 | 2,466.90 | 3,674.59 |
| Opening Net Working Capital [A] | 645.69 | (51.18) | (214.47) |
| Closing Net Working Capital [B] | 2,782.32 | 645.69 | (51.18) |
| Average Net Working Capital [C = (A+B)/2] | 1,714.01 | 297.26 | (132.83) |
| Revenue from operations [D] | 6,920.03 | 7,789.97 | 4,679.08 |
| Working capital ratio [E = D/C] | 4.04 | 26.21 | (35.23) |
| Net Working Capital Days [F = days in the fiscal year/E] (days) | 90 | 14 | (10) |
BASIS OF PREPARATION OF RESTATED FINANCIAL INFORMATION
Basis of preparation
Basis of Preparation of Restated Financial Information
(a) Statement of compliance
The Restated Financial Information of the Company and its subsidiaries comprises of the Restated Statement of Assets and Liabilities as at 31 March 2026, 31 March 2025 and 31 March 2024, the Restated Statement of Profit and Loss (including Other Comprehensive income), the Restated Statement of Cash Flows, the Restated Statement of Changes in Equity for the years ended 31 March 2026, 31 March 2025 and 31 March 2024, the summary of material accounting policies and other explanatory Information (collectively, the Restated Financial Information).
These Restated Financial Information have been prepared by the Management of the Company for the purpose of inclusion in the Red Herring Prospectus the (RHP) and the Prospectus to be filed with the Securities and Exchange Board of India (SEBI), BSE Limited (the BSE) and National Stock Exchange of India Limited (the NSE) (BSE and NSE together, referred to as the Stock Exchanges) prepared by the Company in connection with its proposed initial public offer of equity shares (IPO). These Restated Financial Information have been prepared in terms of the requirements of:
(a) Section 26 of Part I of Chapter III of the Companies Act, 2013 (the Act);
(b) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2018, as amended (the ICDR Regulations)
(c) the Guidance Note on Reports in Company Prospectuses (Revised 2019) issued by the Institute of Chartered Accountants of India (ICAI), as amended (the Guidance Note).
(d) E-mail dated 28 October 2021 from SEBI to Association of Investment Bankers of India, instructing lead managers to ensure that companies provide consolidated financial statements prepared in accordance with Indian Accounting Standards (Ind AS) for all the three years.
These Restated Financial Information have been compiled by the management from:
(a) the audited consolidated financial statements of the Group as at and for the year ended 31 March 2026 prepared in accordance with Indian Accounting Standards (referred to as Ind AS) as prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 (as amended), and other accounting principles generally accepted in India which have been approved by the Board of Directors at their meeting held on 18 May 2026.
(b) the audited consolidated financial statements of the Group as at and for the year ended 31 March 2025 prepared in accordance with Ind AS as prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 (as amended), and other accounting principles generally accepted in India which have been approved by the Board of Directors at their meeting held on 10 June 2025.
(c) the audited special purpose combined financial statements of the Group as at and for the year ended 31 March 2024 prepared based on the following:
(i) The audited standalone statutory financial statements of the Company as at and for the year ended 31 March 2024, prepared in accordance with Indian Accounting Standards prescribed under Section 133 of the Act read with Companies (Indian Accounting Standards) Rules 2015, as amended, and other recognized accounting practices and policies generally accepted in India; and
(ii) Pursuant to the Companies (Indian Accounting Standard) Rules, 2015 (as amended from time to time), Engineered Coated Fabric Private Limited (ECFPL or the Subsidiary), adopted 01 April 2023 as reporting date for first time adoption of Indian Accounting Standards (Ind AS) notified under these rules, and consequently 01 April 2023 as the transition date for preparation of its statutory financial statements for the year ended 31 March 2025. Hence, the general purpose financial statements of the Subsidiary as at and for the year ended 31 March 2025, were the first financials statements, prepared in accordance with the Ind AS. Up to, for the financial year ended 31 March 2024 the Subsidiary had prepared its general purpose financial statements in accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with Companies (Accounting Standards) Rules, 2021 (Indian GAAP or Previous GAAP) due to which these Special Purpose financial statements are prepared. Also, these Special Purpose Financial Statements are not the statutory financial statements of the Subsidiary under the Act. These Special Purpose financial statements of the Subsidiary as at and for the year ended 31 March 2024 , have been prepared after making suitable adjustments to the accounting heads from their Indian GAAP values following accounting policies and accounting policy choices (both mandatory exceptions and optional exemptions availed as per Ind AS 101) consistent with that used at the date of transition to Ind AS (01 April 2023) and as per the presentation, accounting policies and grouping/classifications including revised Schedule III to the Companies Act, 2013 disclosures followed as at and for the year ended 31 March 2025 which have been approved by the Board of Directors at their meeting held on 03 September 2025.
As disclosed in Note 51 to the Restated Financial Information, the Company acquired Engineered Coated Fabric Private Limited (the Subsidiary) on 05 December 2024. The statutory date of transition to Ind AS for the Subsidiary is 01 April 2023. However, for the purpose of preparing the Restated Financial Information, the Company has adopted a transition date of 01 April 2022. Accordingly, the Subsidiary has applied the same accounting policies and policy choices (including both mandatory exceptions and optional exemptions availed under Ind AS 101, as applicable) as on 01 April 2022, consistent with those initially adopted on the statutory transition date of 01 April 2023. This acquisition has been classified as a common control transaction in accordance with Appendix C to Ind AS 103, Business Combinations.
Accordingly, audited standalone statutory financial statements of the Company for the year ended 31 March 2024 and audited special purpose financial statements of the subsidiary acquired vide common control transaction (Refer note 51) for the year ended 31 March 2024 have been combined in accordance with Guidance Note on Combined and Carve-Out Financial Statements issued by the Institute of Chartered Accountants of India.
A reconciliation of total equity and total comprehensive income between the Audited Consolidated Financial Statements as at and for the years ended 31 March 2026 and 31 March 2025, Audited Special Purpose Combined Financial Statements as at and for the year ended 31 March 2024 and Restated Financial Information has been presented in Annexure VI - Part A.
The Restated Financial Information were authorized for issue by the Companys Board of Directors on 05 June 2026
(b) Principles of Consolidation
The Restated Financial Information comprise the financial statements of the Company and its Subsidiaries. Subsidiaries are entities controlled by the Group. The Restated Financial Information of the Group have been prepared in accordance with the Indian Accounting Standards on Consolidated Financial Statements (Ind AS 110) notified under Section 133 of the Companies Act, 2013. The Group controls an investee only if the Group has:
Power over the investee (i.e.existing rights that give it the current ability to direct the relevant activities of the investee
Exposure, or rights, to variable returns from its involvement with the investee, and
The ability to use its power over the investee to affect its returns.
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the Restated Financial Information from the date the Group gains control until the date the Group ceases to control the subsidiary.
Restated Financial Information are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the Group uses accounting policies other than those adopted in the Restated Financial Information for like transactions and events in similar circumstances, appropriate adjustments are made to that Group members financial statements in preparing the Restated Financial Information to ensure conformity with the Groups accounting policies. The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the parent company, i.e., year ended on 31 March. The Combined Financial Statements have been prepared by combining like items of assets, liabilities, equity, income, expenses and cash flows of the entities forming part of Group. All the intragroup assets and liabilities, equity, income, expenses and cash flows relating to entities forming part of Group have been eliminated and profits or losses arising from intragroup transactions have been eliminated in full.
Combined financial information are prepared using uniform accounting policies for like transactions and other events in similar circumstances. The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the parent company, i.e., year ended on 31 March.
(c) Basis of measurement
The Restated Financial Information have been prepared on accrual basis and under historical cost convention, except for the following:
- Certain financial assets and liabilities measured at fair value (refer accounting policy regarding financial instruments)
- Employees defined benefit obligation and leave encashment are recognised as per actuarial valuation. - Share-based payments liability measured at fair value
Classification into current and non-current:
The Group presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is: - Expected to be realised or intended to be sold or consumed in normal operating cycle - Held primarily for the purpose of trading - Expected to be realised within twelve months after the reporting period, or - Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is current when:
- It is expected to be settled in normal operating cycle - It is held primarily for the purpose of trading
- It is due to be settled within twelve months after the reporting period, or
- There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period
The Group classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
Based on the nature of business and the time between the acquisition of assets for processing and their realisation in cash or cash equivalents, the Group has ascertained its normal operating cycle as 12 months for the purpose of Current/Non-current classification of assets and liabilities.
(d) Use of estimates, judgements and assumptions
The preparation of Restated Financial Information requires the Management to make estimate and assumptions that affect the reported amount of assets and liabilities as at the Balance Sheet date, reported amount of revenue and expenses for the year and disclosures of contingent liabilities as at the Balance Sheet date. The estimates and assumptions used in the Groups financial statements are based upon the Managements evaluation of the relevant facts and circumstances as at the date of the financial statements. Actual results could differ from these estimates. Estimates and underlying assumptions are reviewed on a periodic basis. Revisions to accounting estimates, if any, are recognized in the year in which the estimates are revised and in any future years affected. (Refer Note 4 for details).
(e) Presentation currency and rounding off
The Restated Financial Information are presented in Indian Rupees (INR), which is both the functional currency of the Group and the currency of the primary economic environment in which it operates. All amounts are stated in millions of INR, rounded to two decimal places, in accordance with the requirements of Schedule III to the Companies Act 2013, unless stated otherwise. Figures represented as 0 denote values that are not zero but have been rounded to the nearest INR million.
(f) Going Concern
The Restated Financial Information are prepared on a going concern basis as the Management is satisfied that the Group shall be able to continue its business for the foreseeable future and no material uncertainty exists that may cast significant doubt on the going concern assumption. In making this assessment, the Management has considered a wide range of information relating to present and future conditions, including future projections of profitability, cash flows and capital resources.
Material accounting policies
A summary of the material accounting policies applied in the preparation of the Restated Financial Information are as given below. These accounting policies have been applied consistently to all periods presented in the Restated Financial Information.
Property, plant and equipment
Property, plant and equipment, are stated at historical cost of acquisition or construction less accumulated depreciation and impairment losses, if any. Cost of property, plant and equipment comprises its purchase price net of any discounts and rebates, any import duties and other taxes (other than those subsequently recovered from the tax authorities), any directly attributable expenditure on making the asset ready for its intended use.
The Group identifies and determines cost of each part of an item of property plant and equipment separately if the part has a cost which is significant to the total cost of that item of property plant and equipment and has useful life that is materially different from that of the remaining item.
Subsequent costs are included in the assets carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced (All other repairs and maintenance are charged to Statement of Profit and Loss during the year in which they are incurred).
Interest cost incurred is capitalized up to the date the asset is ready for its intended use for qualifying assets, based on borrowings incurred specifically for financing the asset or the weighted average rate of all other borrowings, if no specific borrowings have been incurred for the asset.
Depreciation methods, estimated useful lives
Depreciation on property, plant and equipment is provided on a pro-rata basis on the straight-line method as per the useful life prescribed in Schedule II to the Companies Act, 2013 , or re-assessed by the Group. The Group has estimated the following as useful life to provide depreciation on its Property, Plant & Equipment.
The useful life, residual value and the depreciation method are reviewed at least at each financial year end. If the expectations differ from previous estimates, the changes are accounted for prospectively as a change in accounting estimate.
| Name of the asset | Estimated Useful Lives by the management |
| Buildings | 3 to 30 years |
| Plant & Machinery | 7.5 to 15 years |
| Electrical Installation | 10 years |
| Furniture & Fixtures | 10 years |
| Vehicles | 10 years |
| Leasehold Improvement | 8 to 10 years Lower of lease period & estimated useful life |
| Office/Factory Equipment | 5 years |
| Computers | 3 years |
Depreciation on addition to property plant and equipment is provided on pro-rata basis from the date of acquisition. Depreciation on sale/deduction from property plant and equipment is provided up to the date preceding the date of sale, deduction as the case may be. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in Statement of Profit and Loss under Other income / Other expenses respectively.
Grants from the government are recognised at their fair value where there is reasonable assurance that the grant will be received and the Company will comply with all attached conditions.Government grants relating to assets, including non-monetary grants at fair value, shall be presented in the balance sheet either by setting up the grant as deferred income or by deducting the grant in arriving at the carrying amount of the asset.
Capital work-in-progress
Cost of assets not ready for intended use, as on the Balance sheet date, is shown as capital work in progress. The cost of self-constructed assets includes the cost of materials & direct labour, any other costs directly attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by management and borrowing costs.
Expenses directly attributable to construction of property, plant and equipment incurred till they are ready for their intended use are identified and allocated on a systematic basis on the cost of related assets.
Other Intangible Assets
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is recognised on a straight line basis over their estimated useful lives so as to reflect the pattern in which the assets economic benefits are consumed. The estimated useful life and amortization method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. The amortization of intangible asset is included in Depreciation and amortization expense in Statement of Profit and Loss.
Software is amortized over the managements estimate of its useful life, i.e. 6 years.
Intangible assets with finite lives are assessed for impairment whenever there is an indication that the intangible asset may be impaired.
Impairment of non-financial assets
The Group assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the assets recoverable amount. An assets recoverable amount is the higher of an assets or Cash-Generating Units (CGUs) fair value less costs of disposal and its value in use.
The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.
The Group bases its impairment calculation on most recent budgets and forecast calculations, which are prepared separately for each of the Groups CGUs to which the individual assets are allocated.
An assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Group estimates the assets or CGUs recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the assets recoverable amount since the last impairment loss was recognised.
The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit or loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.
Inventories
Inventories are valued at the lower of cost or net realizable value.
Cost of raw material, stores spares, packing material etc. includes cost of purchase and other cost incurred in bringing the inventories to their present location and condition. Costs of purchased inventory are determined after deducting rebates and discounts.
Finished goods and work- in progress : Cost includes cost of direct material and labour and a proportion of manufacturing overheads based on the normal operating capacity, but excluding borrowing cost.
Spare parts those does not meet definition of Property, Plant and Equipment are carried as inventory.
Transit stock are valued at cost.
Cash and cash equivalents and Cash flow statement
Cash and cash equivalent in the balance sheet comprises cash at banks, cash on hand, fixed deposits having a original maturity of less than 3 months, which are subject to an insignificant risk of changes in value.
Cash flows are reported using the indirect method, whereby net profits before tax are adjusted for the effects of the transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Group are segregated.
Foreign Currency Translation
(a) Initial Recognition:
On initial recognition, transactions in foreign currencies entered into by the Group are recorded in the functional currency, by applying to the foreign currency amount, the spot exchange rate between the functional currency and the foreign currency at the date of the transaction.
(b) Measurement of foreign currency items at reporting date:
Foreign currency monetary items of the Group are translated at the closing exchange rates. Nonmonetary items that are measured at historical cost in a foreign currency, are translated using the exchange rate at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency, are translated using the exchange rates at the date when the fair value is measured.
Exchange differences arising out of foreign exchange translations and settlements during the year are recognised in the Consolidated Statement of Profit and Loss.
(c) Translation of financial statements of foreign entities :
On consolidation, the assets and liabilities of foreign operations are translated into INR at the exchange rate prevailing at the reporting date and their statements of profit and loss are translated at exchange rates prevailing at the dates of the transactions.
Any exchange differences arising from the translation of foreign operations are recognized in the Consolidated Statement of Other Comprehensive Income (OCI). These exchange differences are accumulated in equity under a separate component known as the Foreign Currency Translation Reserve.
Provisions and contingent liabilities
Provisions are recognized when there is a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and there is a reliable estimate of the amount of the obligation. Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the Balance sheet date.
Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group or a present obligation that arises from past events, where it is either not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount cannot be made.
Contingent assets are possible assets that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. A contingent asset is disclosed, where an inflow of economic benefits is probable.
Fair value measurement
The Group measures certain financial instruments at fair value at each balance sheet date.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:
In the principal market for the asset or liability, or
In the absence of a principal market, in the most advantageous market for the asset or liability accessible to the Group.
The best estimate of the fair value of a financial instrument on initial recognition is normally the transaction price i.e. the fair value of the consideration given or received. If the Group determines that the fair value on initial recognition differs from the transaction price and the fair value is evidenced neither by a quoted price in an active market for an identical asset or liability nor based on a valuation technique that uses only data from observable markets, then the financial instrument is initially measured at fair value, adjusted to defer the difference between the fair value on initial recognition and the transaction price. Subsequently that difference is recognised in Statement of Profit and Loss on an appropriate basis over the life of the instrument but no later than when the valuation is wholly supported by observable market data or the transaction is closed out.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
Level 3 Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
(a) Financial assets
(i) Initial recognition and measurement
At initial recognition, financial asset is measured at its fair value plus the transaction cost directly attributable to the acquisition of the financial asset in the case of a financial asset measured not at fair value through profit or loss. Transaction costs directly attributable to the acquisition of financial assets measured at fair value through profit or loss are recognized immediately in the Statement of Profit and Loss. However, trade receivables that do not contain a significant financing component are measured at transaction price.
(ii) Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in following categories:
a) at amortized cost; or
b) at fair value through other comprehensive income; or
c) at fair value through profit or loss.
The classification depends on the entitys business model for managing the financial assets and the contractual terms of the cash flows.
Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. Interest income from these financial assets is included in finance income using the effective interest rate method (EIR).
After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included in finance income in the Statement of Profit and Loss.
Fair value through other comprehensive income (FVOCI): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets cash flows represent solely payments of principal and interest, are measured at fair value through other comprehensive income (FVOCI). Movements in the carrying amount are taken through other comprehensive income (OCI), except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognized in Statement of Profit and Loss.
When the financial asset is derecognised, the cumulative gain or loss previously recognized in OCI is reclassified from equity to Statement of Profit and Loss and recognized in other gains / losses.
Fair value through profit or loss: Assets that do not meet the criteria for amortized cost or FVOCI are measured at fair value through profit or loss. Interest income from these financial assets is included in other income.
Equity instruments: All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading are classified as at FVTPL. For all other equity instruments, the Group may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Group makes such election on an instrument- by-instrument basis. The classification is made on initial recognition and it is irrevocable.
In case of equity instruments classified as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of the amounts from OCI to Statement of Profit and Loss, even on sale of investment. However, the Group may transfer the cumulative gain or loss within equity.
Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the Statement of Profit and Loss.
(iii) Impairment of financial assets
In accordance with Ind AS 109 Financial Instruments, the Group applies Expected Credit Loss (ECL) model for measurement and recognition of impairment loss on the following financial assets and credit risk exposure:
Trade receivables:
The Group follows simplified approach for recognition of impairment loss allowance on trade receivables resulting from transactions within the scope of Ind AS 115 Revenue from Contracts with Customers. The application of simplified approach does not require the Group to track changes in credit risk. Rather, it recognizes impairment loss allowance based on lifetime ECL at each reporting date, right from its initial recognition.
Other financial assets:
For recognition of impairment loss on financial assets and risk exposure, the Group determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime ECL is used. If in subsequent years, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognizing impairment loss allowance based on 12 month ECL.
Lifetime ECL is the expected credit loss resulting from all possible default events over the expected life of a financial instrument. The 12 month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after year end.
ECL is the difference between all contractual cash flows that are due to the Group in accordance with the contract and all cash flows that the entity expects to receive (i.e. all shortfalls), discounted at the original effective interest rate (EIR). When estimating the cash flows, an entity is required to consider all contractual terms of the financial instrument (including prepayment, extension etc.) over the expected life of the financial instrument. However, in rare cases when the expected life of the financial instrument cannot be estimated reliably, then the entity is required to use the remaining contractual term of the financial instrument.
ECL impairment loss allowance (or reversal) recognized during the year is recognized as income/expense in the Statement of Profit and Loss. For financial assets measured at amortised cost, ECL is presented as an allowance, i.e. as an integral part of the measurement of those assets in the Balance Sheet. The allowance reduces the net carrying amount. Until the asset meets write off criteria, the Group does not reduce impairment allowance from the gross carrying amount.
(iv) Derecognition of financial assets
A financial asset is derecognised only when
a) the rights to receive cash flows from the financial asset is transferred or expired
b) retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the received cash flows in full without material delay to one or more recipients.
Where the financial asset is transferred then in that case financial asset is derecognised only if substantially all risks and rewards of ownership of the financial asset is transferred. Where the entity has not transferred substantially all risks and rewards of ownership of the financial asset, the financial asset is not derecognised.
Where the financial asset is neither transferred, nor the entity retains substantially all risks and rewards of ownership of the financial asset, then in that case financial asset is derecognized only if the Group has not retained control of the financial asset. Where the Group retains control of the financial asset, the asset is continued to be recognised to the extent of continuing involvement in the financial asset. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained.
On derecognition of a financial asset, the difference between the carrying amount and the consideration received is recognised in the Statement of Profit and Loss.
(b) Financial liabilities and equity instruments
Classification as debt or equity
An instrument issued by a Group are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs.
Financial liabilities
(i) Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or at amortized cost, as appropriate.
All financial liabilities are recognized initially at fair value and, in the case of loans, borrowings and payables, net of directly attributable transaction costs.
(ii) Subsequent measurement
The measurement of financial liabilities depends on their classification, as described below:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.
Derivative financial instruments
The Group uses derivative financial instruments, primarily foreign exchange forward contracts, to manage its exposure to foreign exchange risk. These contracts are generally entered into with banks as counterparties.
Derivatives that are not designated as hedging instruments, or those designated as hedges but deemed ineffective under Ind AS 109, are accounted for as financial assets or financial liabilities at fair value through profit or loss.
Such derivatives are initially recognized at fair value on the contract date, with any attributable transaction costs recognized in the Statement of Profit and Loss when incurred. Subsequently, these derivatives are re-measured at fair value through profit or loss, and any resulting gains or losses are recorded in other income or other expenses.
Derivatives with a positive fair value are classified as financial assets, while those with a negative fair value are classified as financial liabilities.
Borrowings
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortized cost using the EIR method. Gains and losses are recognized in Statement of Profit and Loss when the liabilities are derecognized as well as through the EIR amortization process. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the Statement of Profit and Loss.
The entitys long-term borrowings are all at a variable interest rate; therefore, the unamortised transaction costs incurred on these borrowings are amortized on a straight-line basis instead of using the effective interest rate (EIR) method.
Financial liabilities at amortised cost
All the financial liabilities of the Group are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in the Statement of Profit and Loss when the liabilities are derecognised as well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the Statement of Profit and Loss.
(iii) Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the Statement of Profit and Loss as finance costs.
(c) Offsetting financial instruments
Financial assets and liabilities are offset and the net amount is reported in the Balance Sheet where there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the assets and settle liabilities simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of the Group or the counterparty.
Corporate Guarantee
Corporate guarantees given are treated as deferred income and amortized over the term of the guarantee on a systematic basis. The amortization is recognized in the profit and loss statement under Other Income, reflecting the usage pattern of the guarantee.
Leases
As a lessee:
At inception of a contract, the Group assesses whether a contract is, or contain a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group assesses whether:
(a) The contract involves the use of an identified asset this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the supplier has a substantive substation right, then the asset is not identified;
(b) The Group has the right to substantially all of the economic benefits from the use of the asset throughout the period of use; and
(c) The Group has the right to direct the use of the asset. The Group has this right when it has the decision making rights that are most relevant to changing how and for what purposes the asset is used. In rare cases where the decision about how and for what purpose the asset is used is predetermined, the Group has the right to direct the use of the asset if either:
The Group has the right to operate the asset; or
The Group designed the asset in a way that predetermines how and for what purposes it will be used The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain re-measurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, Groups incremental borrowing rate. The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Groups estimate of the amount expected to be payable under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The Group has elected to not recognize leases with a lease term of 12 months or less or of low value in the balance sheet, and lease costs for those short-term leases or low-value leases are recognized on a straight-line basis over the lease term in the Statement of Profit and Loss. The Group has elected the lessee practical expedient to combine lease and non-lease components and account for the combined unit as a single lease component.
Employee Benefits
(i) Defined benefit plans
Gratuity: The Groups gratuity benefit scheme is a defined benefit plan. Groups net obligation in respect of a defined benefit plan is calculated by estimating amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. Present value of obligation under such benefit plan is determined based on actuarial valuation using projected unit credit method which recognizes each period of service that give rise to additional units of employee benefit entitlement and measures each unit separately to build up final obligation. Obligation is measured at present values of estimated future cash flows. The discounted rates used for determining present value are based on market yields on Government Securities as at the balance sheet date.
Defined benefit costs are categorised as follows:
i. The current service cost of the defined benefit plans, recognised in the Statement of Profit and Loss in employee benefits expense, reflects the increase in the defined benefit obligation resulting from employee service in the current year, benefit changes, curtailments and settlements. Past service costs, which comprise plan amendments and curtailments, as well as gains or losses on the settlement of pension benefits are recognised immediately in the Statement of Profit and Loss when they occur.
ii. The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in finance cost in the Statement of Profit and Loss.
iii. Re-measurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. Remeasurements are not reclassified to the Statement of Profit and Loss in subsequent periods.
(ii) Defined contribution plans
Contributions to defined contribution plans are recognised as expense when employees have rendered services entitling them to such benefits.
The Group provides benefits such as provident fund to its employees which is treated as defined contribution plan.
(iii) Short-term employee benefit obligations
Employee benefits payable wholly within twelve months of receiving employee services are classified as short-term employee benefits and are recognised in the period in which the employee renders the related service. These benefits include salaries and wages, bonus and ex-gratia. The undiscounted amount of short-term employee benefits to be paid in exchange for employee services is recognized as an expense as the related service is rendered by employees.
(iv) Compensated absences:
Compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as undiscounted liability at the balance sheet date. Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as an actuarially determined liability at the present value of the defined benefit obligation at the balance sheet date using the Projected Unit Credit Method
Presentation and disclosure:
For the purpose of presentation of defined benefit plans and compensated absences, the allocation between the current and non-current provisions has been made as determined by an actuary.
Revenue Recognition
Revenue from contracts with customers is recognised on transfer of control of promised goods or services to a customer at an amount that reflects the consideration to which the Group is expected to be entitled to in exchange for those goods or services. It is measured at transaction price (net of variable consideration) allocated to that performance obligation. Revenue (net of variable consideration) is recognised only to the extent that it is highly probable that the amount will not be subject to significant reversal when uncertainty relating to its recognition is resolved.
(i) Sale of Products
Revenue from sale of products is recognised when the control on the goods have been transferred to the customer. The performance obligation in case of sale of product is satisfied at a point in time i.e., when the goods are shipped to the customer or on delivery to the customer, as may be specified in the contract.
(ii) Rendering of Services:
Revenue from services is recognised over time by measuring progress towards satisfaction of performance obligations for the services rendered.
(iii) Other Operating revenue
Government Grants and subsidies: Recognition and Measurement:
The Group recognises grant as income when there is a reasonable assurance that the Group will comply with all necessary conditions attached to them and the grant or subsidy will be received in accordance with Ind AS 20, Accounting for Government Grants and Disclosure of Government Assistance. Revenue from export incentives, including those arising under the Remission of Duties and Taxes on Exported Products (RoDTEP), and Duty Drawback Scheme, is recognised on an accrual basis, post-export, at the rates at which the entitlements accrue.
Presentation:
Income from the above grants and subsidies are presented under Revenue from Operations Other Operating Income.
Other income
Interest income
Interest income is recognized when it is probable that the economic benefits will flow to the Group and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that discounts estimated future cash receipts through the expected life of the financial asset to that assets net carrying amount on initial recognition. Interest income is included under the head other income in the Statement of profit and loss.
For all financial instruments measured at amortized cost, interest income is recorded using the effective interest rate, which is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset. Interest income is included in other income in the Statement of profit and loss.
Taxes
Tax expense for the year, comprising current tax and deferred tax, are included in determination of the net profit or loss for the year.
(i) Current income tax
Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the Income Tax Act, 1961. Advance taxes and provisions for current income taxes are presented in the balance sheet after offsetting advance tax paid and income tax provision arising in the same tax jurisdiction and where the Group intends to settle the asset and liability on a net basis. Current income tax relating to items recognised outside the Statement of Profit and Loss is recognised in correlation to the underlying transaction either in OCI or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
(ii) Deferred tax
Deferred tax is recognised on temporary differences, being differences between the carrying amount of assets and liabilities and corresponding tax bases used in the computation of taxable profit. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted as at the reporting date. Deferred tax liabilities are recognised for all temporary differences. Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised.
Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Group has a legally enforceable right for such set off.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax relating to items recognised outside Statement of Profit and Loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.
Earnings Per Share
Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. The weighted average number of equity shares outstanding during the year and for all the years presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares, that have changed the number of equity shares outstanding, without a corresponding change in resources.
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
Segment Reporting
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the Groups chief operating decision maker (CODM) to make decisions for which discrete financial information is available. The Group is engaged in selling of goods. The CODM identified entire business as a single reportable segment, namely manufacturing of technical textiles fabrics, hence segment reporting is not applicable (Refer note 45).
Employee stock compensation cost
The fair value of options granted under the Groups employee stock option scheme measured as the excess of the fair value over the exercise price of the option at the date of grant is recognised as an employee benefit expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the fair value of the options granted:
including any market performance conditions (e.g. the entitys share price)
excluding the impact of any service and non-market performance vesting conditions (e.g. profitability, sales growth targets and remaining an employee of the entity over a specified time period), and including the impact of any non-vesting conditions (e.g. the requirement for employees to save or holding shares for a specific period of time). Further details are given in Note 49.
That cost is recognised, together with a corresponding increase in share options outstanding account in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense.
The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Groups best estimate of the number of equity instruments that will ultimately vest. The expense or credit in the statement of profit and loss for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.
Borrowing cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Business combination under common control
Common control business combination refers to a business combination involving entities in which all the combining entities are ultimately controlled by the same party or parties both before and after the business combination, and that control is not transitory. Business combinations involving entities or businesses under common control have been accounted for using the pooling of interest method. The assets and liabilities of the combining entities are reflected at their carrying amounts. No adjustments have been made to reflect fair values, or to recognise any new assets or liabilities.
The financial information in the Restated Financial Information in respect of prior periods have been restated as if the business combination had occurred from the beginning of the earliest period presented in these Restated Financial Information, irrespective of the actual date of the combination. However, if business combination had occurred after that date, the prior period information has been restated only from date of the business combination.
The difference, if any, between the purchase consideration paid either in the form of share capital or cash or other assets and the amount of net assets of the entities acquired is transferred to capital reserve in case of credit balance and common control adjustment deficit account in case of debit balance and presented separately from other reserves within equity. The nature and purpose of such reserve in disclosed in the notes.
Material accounting judgments, estimates and assumptions
The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, the Grouping disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future years.
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the year end date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Group. Such changes are reflected in the assumptions when they occur.
(a) Useful lives of property, plant and equipment and intangible assets
As described in the significant accounting policies, the Group reviews the estimated useful lives of property, plant and equipment and intangible assets at the end of each reporting period. Useful lives of intangible assets is determined on the basis of estimated benefits to be derived from use of such intangible assets. These reassessments may result in change in the depreciation /amortization expense in future periods.
(b) Actuarial Valuation
The determination of Groups liability towards defined benefit obligation to employees is made through independent actuarial valuation including determination of amounts to be recognised in the Statement of Profit and Loss and in Other Comprehensive Income. Such valuation depend upon assumptions determined after taking into account discount rate, salary growth rate, expected rate of return, mortality and attrition rate. Information about such valuation is provided in notes to the financial statements.
(c) Impairment of non-financial assets
In assessing impairment, management estimates the recoverable amount of each asset or cash-generating units based on expected future cash flows and uses an interest rate to discount them. Estimation uncertainty relates to assumptions about future operating results and the determination of a suitable discount rate.
(d) Contingencies
Management judgement is required for estimating the possible outflow of resources, if any, in respect of contingencies/ claim/ litigation against Group as it is not possible to predict the outcome of pending matters with accuracy.
(e) Provisions
Provisions are recognised in the period when it becomes probable that there will be a future outflow of funds resulting from past operations or events that can reasonably be estimated. The timing of recognition requires application of judgement to existing facts and circumstances which may be subject to change. The litigations and claims to which the Group is exposed are assessed by management and in certain cases with the support of external specialised lawyers.
(f) Income taxes
Management judgment is required for the calculation of provision for income taxes and deferred tax assets and liabilities. The Group reviews at each balance sheet date the carrying amount of deferred tax assets. The factors used in estimates may differ from actual outcome which could lead to significant adjustment to the amounts reported in the Restated Financial Information.
(g) Leases
The Group evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease requires significant judgement. The Group uses significant judgement in assessing the lease term (including anticipated renewals) and the applicable discount rate. The Group determines the lease term as the non cancellable period of a lease, together with both periods covered by an option to extend the lease if the Group is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Group is reasonably certain not to exercise that option. In assessing whether the Group is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Group to exercise the option to extend the lease, or not to exercise the option to terminate the lease. The Group revises the lease term if there is a change in the non-cancellable period of a lease. The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio of leases with similar characteristics.
(h) Fair value measurement of financial instruments
When the fair values of financials assets and financial liabilities recorded in the Balance Sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques, including the discounted cash flow model, which involve various judgements and assumptions
(i) Provision for expected credit losses of trade receivables and contract assets
The Group uses a provision matrix to calculate expected credit loss (ECL) for trade receivables and contract assets.
The provision matrix is initially based on the Groups historical observed default rates. At every reporting date, the historical observed default rates are updated.
The assessment of the correlation between historical observed default rates and ECLs is a significant estimate.
The Groups historical credit loss experience may also not be representative of customers actual default in the future.
(j) Share based payments
For the measurement of the fair value of equity-settled transactions with employees at the grant date, the Group uses a Black Scholes model for Employee Stock Option. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 49.
Recent pronouncements
The Ministry of corporate Affairs (MCA) notified amendments on 7 May 2025 and 13 August 2025 under the Companies (Indian Accounting Standards) Amendment Rules, 2025 and the Companies (Indian Accounting Standards) Second Amendment Rules, 2025, respectively, which is effective from annual reporting periods beginning on or after 1 April 2025.
(a) Amendment to IND AS 7 and IND AS 107 Supplier Finance Arrangement The Group does not have any supplier finance arrangement during the reporting period
(b)Amendment to Ind AS 1 - Classification of liabilities as current or non-current and non-current These amendments have no effect on the measurement of any items in the Consolidated financial statements of the Group. The Group did not make retrospective adjustments as a result of adopting the amendments to Ind AS 1.
(c) Amendment to Ind AS 12 Pillar-Two Tax Reforms The Group is not within the scope of the OECD Pillar Two Module Rule, as pillar Two legislative has note yet been enacted in any of the jurisdiction in which the Company operate.
(d) Amendment to Ind AS 21-Lack of exchangeability These Amendment did not have any material impact on the account recognised in prior period and are not expected to significantly affect the current or future periods.
DESCRIPTION OF KEY COMPONENTS OF OUR RESTATED STATEMENT OF PROFIT AND LOSS
Income
Our total income consists of revenue from operations and other income.
Revenue from operations
Our revenue from operations is generated from:
(i) revenue from contracts with customers, which includes revenue from
(a) the sale of products (being manufactured goods) and
(b) the sale of services; and
(ii) other operating income, which includes revenue from
(a) government grants,
(b) duty drawback,
(c) Remission of Duties and Taxes on Exported Products scheme (the RODTEP) income, and
(d) sale of scrap.
Other income
Our other income consists of:
(i) foreign exchange gain;
(ii) interest income, which includes
(a) interest income on fixed deposits,
(b) interest income on the unwinding of discounts on security deposits and
(c) other interest income;
(iii) allowance for expected credit loss reversal;
(iv) profit on the sale of assets;
(v) sundry balance written back;
(vi) gain on cancellation of lease; and
(vii) miscellaneous income. Components of our miscellaneous income for the past three Fiscals have included interest subsidy for a term loan.
Expenses
Our total expenses consist of:
(i) cost of materials consumed;
(ii) changes in inventories of finished goods and semi-finished goods;
(iii) cost of service;
(iv) employee benefits expense;
(v) finance costs;
(vi) depreciation and amortisation expense; and
(vii) other expenses.
Cost of materials consumed
Our cost of materials consumed is the net of our opening stock plus the purchases during the relevant financial year less our closing stock.
Changes in inventories of finished goods and semi-finished goods
Our changes in inventories of finished goods and semi-finished goods indicate the difference between inventory of finished stock and semi-finished stock at the beginning of the year, and at the end of the year.
Cost of service
Our cost of services pertains to costs incurred by Kusumgar Middle East FZ LLC, our Companys subsidiary.
Kusumgar Middle East FZ LLC was awarded a comprehensive maintenance contract by a customer and subsequently subcontracted the service portion of the contract to our Company. In the standalone financial statements of Kusumgar Middle East FZ LLC, the total cost disclosed under Cost of Services comprises the subcontracting charges payable to our Company, along with applicable GST and other direct costs incurred by Kusumgar Middle East FZ LLC. During consolidation, the inter-company revenue and corresponding costs relating to the subcontract arrangement between Kusumgar Middle East FZ LLC and our Company were eliminated. Accordingly, only the external costs, including GST and other direct expenses, incurred by Kusumgar
Middle East FZ LLC are reflected under Cost of Services in the consolidated financial statements.
Employee benefits expense
Our employee benefits expense consists of:
(i) salaries, wages and bonus;
(ii) staff welfare expenses;
(iii) contributions to provident and other funds (including superannuation funds and new pension schemes);
(iv) share based payments to employees;
(v) leave encashment expenses; and
(vi) gratuity expenses.
Finance costs
Our finance costs consist of:
(i) interest expense, which include
(a) interest expense on borrowings at amortised cost,
(b) interest expense on unsecured loans from director, and
(c) interest expense on lease liabilities; and
(ii) bank and other finance charges.
Depreciation and amortisation expense
Our depreciation and amortisation expense consists of:
(i) depreciation of property, plant and equipment;
(ii) depreciation on right-of-use assets; and
(iii) amortisation of intangible assets.
Other expenses
Our other expenses primarily consist of:
(i) power and fuel;
(ii) job work and labour charges (including charges arising from transactions with related parties);
(iii) warranty expenses;
(iv) royalty expenses;
(v) consumption of stores;
(vi) traveling and conveyance;
(vii) freight and forwarding charges;
(viii) professional and legal fees;
(ix) effluent treatment charges;
(x) advertisement and marketing;
(xii) repairs & maintenance on:
(a) plant and machinery;
(b) building; and
(c) others;
(xiii) rates and taxes;
(xiv) testing charges;
(xv) corporate social responsibility expenses;
(xvi) fair value loss on foreign currency forward contract;
(xvii) insurance charges;
(xviii) rent expenses;
(xix) brokerage and commission;
(xx) allowance for expected credit loss;
(xxi) payment to auditors;
(xxii) director sitting fees;
(xxiii) loss on sale of assets;
(xxiv) provision for doubtful advance;
(xxv) bad debts;
(xxvi) sundry balances written off;
(xxvii) contribution to political parties;
(xxviii) donation;
(xxix) miscellaneous and administration expenses.
Components of our miscellaneous expenses (other than administration expenses) for the past three Fiscals have included factory expenses, postage and courier and telegrams, and membership fees. For more details on certain of our job work and labour charges, see Restated Financial Information Note 43 Related Party Disclosures on page 311.
Income Tax expense
Our tax expenses consist of:
(i) current tax;
(ii) short provision for tax relating to prior years; and
(iii) deferred tax expense/(credit).
OUR RESULTS OF OPERATIONS
The following table sets forth a summary of our restated statement of profit and loss for the fiscal years indicated and such amounts expressed as a percentage of total income.
| For the year ended March 31, | ||||||
| 2026 | 2025 | 2024 | ||||
| Particulars | in million | As a % of total income | in million | As a % of total income | in million | As a % of total income |
| Income: | ||||||
| Revenue from operations | 6,920.03 | 97.22% | 7,789.97 | 98.58% | 4,679.08 | 98.60% |
| Other income | 197.75 | 2.78% | 112.15 | 1.42% | 66.43 | 1.40% |
| Total income | 7,117.78 | 100.00% | 7,902.12 | 100.00% | 4,745.51 | 100.00% |
| Expenses: | ||||||
| Cost of material consumed | 3,081.66 | 43.30% | 3,713.71 | 47.00% | 2,002.86 | 42.21% |
| Changes in inventories of finished goods and semi-finished goods | (519.12) | (7.29)% | (111.76) | (1.41%) | (232.62) | (4.90%) |
| Cost of Services | 84.47 | 1.19% | - | - | - | - |
| Employee benefits expense | 881.86 | 12.39% | 655.73 | 8.30% | 414.85 | 8.74% |
| Finance costs | 259.78 | 3.65% | 146.31 | 1.85% | 63.22 | 1.33% |
| Depreciation and amortisation expense | 466.89 | 6.56% | 341.90 | 4.33% | 170.97 | 3.60% |
| Other expenses | 1,512.66 | 21.25% | 1,648.40 | 20.86% | 1,175.52 | 24.77% |
| Total expenses | 5,768.20 | 81.04% | 6,394.29 | 80.92% | 3,594.80 | 75.75% |
| Profit before tax | 1,349.58 | 18.96% | 1,507.83 | 19.08% | 1,150.71 | 24.25% |
| Income tax expenses: | ||||||
| Current tax | 362.22 | 5.09% | 408.91 | 5.17% | 289.13 | 6.09% |
| Short provision for tax relating to prior years | 0.23 | 0.00% | 0.05 | 0.00% | 0.69 | 0.01% |
| Deferred tax expense/(credit) | 5.13 | 0.07% | (21.01) | (0.27%) | 16.93 | 0.36% |
| Total income tax expenses | 367.58 | 5.16% | 387.95 | 4.91% | 306.75 | 6.46% |
| Profit for the year | 982.00 | 13.80% | 1,119.88 | 14.17% | 843.96 | 17.78% |
Fiscal 2026 compared to Fiscal 2025
Income
Revenue from operations
Set forth below is a table showing our revenue from operations for Fiscals 2026 and 2025.
| Particulars | Fiscal 2026 | Fiscal 2025 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Revenue from operations: | |||
| Sale of products | 6,225.01 | 7,685.98 | (19.01)% |
| Sale of services | 523.13 | 14.97 | 3,394.52% |
| Revenue from contracts with customers | 6,748.14 | 7,700.95 | (12.37)% |
| Other operating income: | |||
| Government grants | 77.15 | 18.04 | 327.66% |
| Duty drawback | 44.05 | 29.33 | 50.19% |
| RODTEP income | 27.40 | 21.03 | 30.29% |
| Sale of scrap | 23.29 | 20.62 | 12.95% |
| Total | 6,920.03 | 7,789.97 | (11.17)% |
Our revenue from operations decreased by 11.17% to 6,920.03 million for Fiscal 2026 from 7,789.97 million for Fiscal 2025, which decrease was primarily due to a 12.37% decrease in our revenue from contracts with customers, which is discussed below.
Revenue from contracts with customers
Our revenue from contracts with customers decreased by 12.37% to 6,748.14 million for Fiscal 2026 from 7,700.95 million for Fiscal 2025, which decrease was primarily due to a decrease in our revenue from Aerospace and Defence Fabrics and Aerospace and Defence Solutions.
The table below sets forth our revenue from contracts with customers from our four primary market segments, and from sales falling outside of those four market segments, for Fiscal 2026 and Fiscal 2025.
| Particulars | Fiscal 2026 | Fiscal 2025 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Aerospace and Defence Fabrics | 2,136.99 | 3,700.92 | (42.26)% |
| Aerospace and Defence Solutions | 1,550.17 | 2,219.02 | (30.14)% |
| Industrial and Automotive Fabrics | 1,648.60 | 1,126.34 | 46.37% |
| Outdoor and Lifestyle Fabrics | 1,253.15 | 569.00 | 120.24% |
| Other Sales (1) | 159.23 | 85.67 | 85.86% |
| Revenue from contracts with customers | 6,748.14 | 7,700.95 | (12.37)% |
Note:
(1) Revenue from other sales includes revenue from the sale of yarn and chemicals, revenue from job work undertaken for customers, as well as revenue from the sale of products and services outside of our four primary market segments.
Our revenue from Aerospace and Defence Fabrics decreased by 42.26% to 2,136.99 million for Fiscal 2026 from 3,700.92 million for Fiscal 2025, which decrease was primarily due to a large order received in Fiscal 2025 that was not re-ordered in Fiscal 2026. We recognized revenue of 2,045.75 million from this order in Fiscal 2025 and 286.16 million from this order in Fiscal 2026.
Our revenue from Aerospace and Defence Solutions decreased by 30.14% to 1,550.17 million for Fiscal 2026 from 2,219.02 million for Fiscal 2025. This decrease was primarily due to the partial deferral of contract performance on a large contract due to operational requirements of the customer. In Fiscal 2026, we received an order with a contract value of 2,371.96 million, of which 23.61% was executed in Fiscal 2026 and we expect the remaining balance will be executed in Fiscal 2027.
Our revenue from Industrial and Automotive Fabrics increased by 46.37% to 1,648.60 million for Fiscal 2026 from 1,126.34 million for Fiscal 2025. This increase was primarily due to an increase in orders from existing customers.
Our revenue from Outdoor and Lifestyle Fabrics increased by 120.24% to 1,253.15 million for Fiscal 2026 from 569.00 million for Fiscal 2025. This increase was primarily due to an increase in orders from existing customers.
Our revenue from Other Sales increased by 85.86% to 159.23 million for Fiscal 2026 from 85.67 million for Fiscal 2025. This increase was primarily due to an increase in sales.
Other operating income
Other operating income increased by 93.09% to 171.89 million for Fiscal 2026 from 89.02 million for Fiscal 2025, which was primarily due to government grant receipts increased to 77.15 million in Fiscal 2026 to 18.04 million in Fiscal 2025.
Other income
Other income increased by 76.33% to 197.75 million for Fiscal 2026 from 112.15 million for Fiscal 2025. This increase was primarily due to an increase in foreign exchange gain to 147.91 million for Fiscal 2026 from 46.95 million for Fiscal 2025. This was partially offset by a decrease in interest income on fixed deposits to 21.89 million for Fiscal 2026 from 57.57 million for Fiscal 2025.
Expenses
Cost of materials consumed and changes in inventories of finished goods and semi-finished goods
Set forth below is a table showing the components of our cost of materials consumed and changes in inventories of finished goods and semi-finished goods for Fiscals 2026 and 2025.
| Particulars | Fiscal 2026 | Fiscal 2025 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Cost of materials consumed: | |||
| Opening stock | 510.56 | 726.11 | (29.69)% |
| Add: Purchases | 3,059.22 | 3,498.16 | (12.55)% |
| Less: Closing stock | (488.12) | (510.56) | (4.40)% |
| Cost of materials consumed [A] | 3,081.66 | 3,713.71 | (17.02)% |
| Particulars | Fiscal 2026 | Fiscal 2025 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Add: Changes in inventories of finished goods and semi-finished goods [B] | (519.12) | (111.76) | 364.50% |
| Cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) [C = A + B] | 2,562.54 | 3,601.95 | (28.86)% |
| Cost of material consumed (including changes in inventories of finished goods and semi-finished goods) as a percentage of revenue from contracts with customers [D = C/E] (%) | 37.97% | 46.77% | (18.82)% |
| Revenue from contracts with customers [E] | 6,748.14 | 7,700.95 | (12.37)% |
Our cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) decreased by 28.86% to 2,562.54 million for Fiscal from 3,601.95 million for Fiscal 2025. This was primarily due to a decrease in purchases during Fiscal 2026 by 12.55% to 3,059.22 million for Fiscal 2026 from 3,498.16 million for Fiscal 2025, and a decrease in opening stock by 29.69% to 510.56 million for Fiscal 2026 from 726.11 million for Fiscal 2025. This decrease in purchases was in turn primarily due to change in product mix. Our cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) as a percentage of our revenue from contracts with customers decreased by 18.82% in Fiscal 2026 as compared to Fiscal 2025.
Cost of services
Our cost of services increased to 84.47 million for Fiscal 2026 from nil for Fiscal 2025. This was primarily due to costs incurred by Kusumgar Middle East FZ LLC, our Companys subsidiary. Kusumgar Middle East FZ LLC was awarded a comprehensive maintenance contract by a customer and subsequently subcontracted the service portion of the contract to our Company. In the standalone financial statements of Kusumgar Middle East FZ LLC, the total cost disclosed under Cost of Services comprises the subcontracting charges payable to our Company, along with applicable GST and other direct costs incurred by Kusumgar Middle East FZ LLC. During consolidation, the inter-company revenue and corresponding costs relating to the subcontract arrangement between Kusumgar Middle East FZ LLC and our Company were eliminated. Accordingly, only the external costs, including GST and other direct expenses, incurred by Kusumgar Middle East FZ LLC are reflected under Cost of Services in the consolidated financial statements
Employee benefits expense
Our employee benefits expense increased by 34.49% to 881.86 million for Fiscal 2026 from 655.73 million for Fiscal 2025. This was primarily due to an increase in salaries, wages and bonus to employees by 7.71% to 579.20 million for Fiscal 2026 from 537.74 million for Fiscal 2025 and share based payment to employees by 491.07% to 204.33 million for Fiscal 2026 from 34.57 million for Fiscal 2025. The increase in salaries, wages and bonus to employees was mainly on account of increase in annual compensation increments provided to employees. The increase in share based payment to employees was due to ESOP expenses amortized during the period. Our employee benefits expense as a percentage of revenue from operations increased by 4.32% in Fiscal 2026 as compared to Fiscal 2025.
Finance costs
Our finance costs increased by 77.55% to 259.78 million for Fiscal 2026 from 146.31 million for Fiscal 2025. This increase was primarily due to a 84.66% increase in interest expenses to 242.31 million for Fiscal 2026 from 131.22 million for Fiscal 2025, which was in turn primarily due to a 103.36% increase in interest expense on borrowings to 186.54 million for Fiscal 2026 from 91.73 million for Fiscal 2025, and a 41.22% increase in lease liabilities to 55.77 million for Fiscal 2026 from 39.49 million for Fiscal 2025.
Depreciation and amortisation expense
Our depreciation and amortisation expense increased by 36.56% to 466.89 million for Fiscal 2026 from 341.90 million for Fiscal 2025, primarily due to an increase in depreciation of property, plant and equipment by 40.45% to 358.79 million for Fiscal 2026 from 255.46 million for Fiscal 2025.
Other expenses
Our other expenses decreased by 8.23% to 1,512.66 million for Fiscal 2026 from 1,648.40 million for Fiscal 2025.
Our other expenses decreased primarily due to a 31.65% decrease in royalty expense to 88.61 million for Fiscal 2026 from 129.64 million for Fiscal 2025, a 24.64% decrease in consumption of stores to 122.48 million for Fiscal 2026 from 162.53 million for Fiscal 2025, a 32.17% decrease in freight and forwarding charges to 87.00 million for Fiscal 2026 from 128.25 million for Fiscal 2025, a 60.83% decrease in rates and taxes to 15.05 million for Fiscal 2026 from 38.42 million for Fiscal 2025 and a 100.00% decrease in allowance for expected credit loss to nil for Fiscal 2026 from 38.05 million for Fiscal 2025. The decrease in royalty expense was primarily due to a decline in the royalty base business, the decrease in consumption of stores was primarily due to efficiencies achieved at a new manufacturing facility, the decrease in freight and forwarding charges was primarily due to a decline in purchases of imported raw materials, the decrease in rates and taxes was primarily due to the elevated rates and taxes expense in Fiscal 2025 having included a one-off charge arising from the increase in the Companys authorised share capital, which did not recur in Fiscal 2026, and the decrease in allowance for expected credit loss was primarily due to a significant portion of trade receivables remaining either not yet due or less than six months past due.
The foregoing was offset slightly by an increase in our job work and labour charges by 9.70% to 397.74 million for Fiscal 2026 from 362.57 million for Fiscal 2025, which was due to the general inflationary increase in labour costs , and an 8.83% increase in power and fuel to 362.74 million for Fiscal 2026 from 333.31 million for Fiscal 2025, which was due to increased electricity consumption arising from the commissioning of additional weaving production capacity at Kosamba 2 and increase in processing capacity at Karanj.
Income Tax expense
Our total income tax expense decreased by 5.25% to 367.58 million for Fiscal 2026 from 387.95 million for Fiscal 2025. Our current tax decreased by 11.42% to 362.22 million for Fiscal 2026 from 408.91 million for Fiscal 2025. Our total income tax expense as a percentage of profit before tax was 27.24% for Fiscal 2026 compared to 25.73% for Fiscal 2025.
Profit for the year
Primarily for the reasons stated above, our profit for the year decreased by 12.31% to 982.00 million for Fiscal 2026 from 1,119.88 million for Fiscal 2025.
Fiscal 2025 compared to Fiscal 2024
Income
Revenue from operations
Set forth below is a table showing our revenue from operations for Fiscals 2025 and 2024.
| Particulars | Fiscal 2025 | Fiscal 2024 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Revenue from operations: | |||
| Sale of products | 7,685.98 | 4,545.65 | 69.08% |
| Sale of services | 14.97 | 11.29 | 32.60% |
| Revenue from contracts with customers | 7,700.95 | 4,556.94 | 68.99% |
| Other operating income: | |||
| Government grants | 18.04 | 52.34 | (65.53%) |
| Duty drawback | 29.33 | 27.20 | 7.83% |
| RODTEP income | 21.03 | 24.55 | (14.34%) |
| Sale of scrap | 20.62 | 18.05 | 14.24% |
| Total | 7,789.97 | 4,679.08 | 66.49% |
Our revenue from operations increased by 66.49% to 7,789.97 million for Fiscal 2025 from 4,679.08 million for Fiscal 2024, which increase was primarily due to a 68.99% increase in our revenue from contracts with customers, which is discussed below.
Revenue from contracts with customers
Our revenue from contracts with customers increased by 68.99% to 7,700.95 million for Fiscal 2025 from 4,556.94 million for Fiscal 2024, which increase was primarily due to an increase in our revenue from Aerospace and Defence Fabrics, Aerospace and Defence Solutions and Outdoor and Lifestyle Fabrics.
The table below sets forth our revenue from contracts with customers from our four primary market segments, and from sales falling outside of those four market segments, for Fiscal 2025 and Fiscal 2024.
| Particulars | Fiscal 2025 | Fiscal 2024 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Aerospace and Defence Fabrics | 3,700.92 | 3,134.88 | 18.06% |
| Aerospace and Defence Solutions | 2,219.02 | 8.64 | 25,583.10% |
| Industrial and Automotive Fabrics | 1,126.34 | 1,113.86 | 1.12% |
| Outdoor and Lifestyle Fabrics | 569.00 | 291.65 | 95.10% |
| Other Sales (1) | 85.67 | 7.92 | 981.69% |
| Revenue from contracts with customers | 7,700.95 | 4,556.94 | 68.99% |
Note:
(1) Revenue from other sales includes revenue from the sale of yarn and chemicals, revenue from job work undertaken for customers, as well as revenue from the sale of products and services outside of our four primary market segments.
Our revenue from Aerospace and Defence Fabrics increased by 18.06% to 3,700.92 million for Fiscal 2025 from 3,134.88 million for Fiscal 2024, which increase was primarily due to an increase in the volume of orders, as well as a change in our product mix. The increase in the volume of orders was primarily attributable to customers outside India.
Our revenue from Aerospace and Defence Solutions increased to 2,219.02 million for Fiscal 2025 from 8.64 million for Fiscal 2024. This increase was primarily due to a large order for Combat Free Fall (CFF) parachute systems, which was a new product introduced by us in Fiscal 2025. We recognised a revenue of 2,225.88 million from this large order for Fiscal 2025.
Our revenue from Outdoor and Lifestyle Fabrics increased by 95.10% to 569.00 million for Fiscal 2025 from 291.65 million for Fiscal 2024. This increase was primarily due to an increase in our final output capacity (comprising the aggregate installed capacity of our processing, dyeing, finishing, printing and coating factories) to 127.80 million metres as at March 31, 2025 from 48.86 million metres as at March 31, 2024. Our final output capacity increased due to our commencement of operations at an additional manufacturing facility located at Kothwa, Taluka Mangrol, District Surat, Gujarat, India on April 1, 2024. We use this manufacturing facility for scouring, dyeing, finishing, processing and coating nylon and polyester fabrics. For more details on our manufacturing capabilities, see Our Business Manufacturing Capabilities on page 197.
Other operating income
Other operating income decreased by 27.12% to 89.02 million for Fiscal 2025 from 122.14 million for Fiscal 2024, which was primarily due to a decrease in government grants.
Other income
Other income increased by 68.82% to 112.15 million for Fiscal 2025 from 66.43 million for Fiscal 2024. This increase was primarily due to an increase in foreign exchange gain to 46.95 million for Fiscal 2025 from 32.40 million for Fiscal 2024, and an increase in interest income on fixed deposits to 57.57 million for Fiscal 2025 from 29.52 million for Fiscal 2024.
Expenses
Cost of materials consumed and changes in inventories of finished goods and semi-finished goods
Set forth below is a table showing the components of our cost of materials consumed and changes in inventories of finished goods and semi-finished goods for Fiscals 2025 and 2024.
| Particulars | Fiscal 2025 | Fiscal 2024 | Percentage Increase/ |
| in million | (Decrease) (%) | ||
| Cost of materials consumed: | |||
| Opening stock | 726.11 | 203.25 | 257.25% |
| Add: Purchases | 3,498.16 | 2,525.72 | 38.50% |
| Less: Closing stock | (510.56) | (726.11) | (29.69%) |
| Cost of materials consumed [A] | 3,713.71 | 2,002.86 | 85.42% |
| Add: Changes in inventories of finished goods and semi-finished goods [B] | (111.76) | (232.62) | (51.96)% |
| Cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) [C = A + B] | 3,601.95 | 1,770.24 | 103.47% |
| Cost of material consumed (including changes in inventories of finished goods and semi-finished goods) as a percentage of revenue from contracts with customers [D = C/E] (%) | 46.77% | 38.85% | 20.39% |
| Revenue from contracts with customers [E] | 7,700.95 | 4,556.94 | 68.99% |
Our cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) increased by 103.47% to 3,601.95 million for Fiscal 2025 from 1,770.24 million for Fiscal 2024. This was primarily due to an increase in purchases during Fiscal 2025 by 38.50% to 3,498.16 million for Fiscal 2025 from 2,525.72 million for Fiscal 2024, and an increase in opening stock by 257.25% to 726.11 million for Fiscal 2025 from 203.25 million for Fiscal 2024. This increase in purchases was in turn primarily due to a change in our product mix. Our cost of materials consumed (including changes in inventories of finished goods and semi-finished goods) as a percentage of our revenue from contracts with customers increased to 46.77% for Fiscal 2025 from 38.85% for Fiscal 2024.
Employee benefits expense
Our employee benefits expense increased by 58.06% to 655.73 million for Fiscal 2025 from 414.85 million for Fiscal 2024. This was primarily due to an increase in salaries, wages and bonus by 45.03% to 537.74 million for Fiscal 2025 from 370.79 million for Fiscal 2024. The increase in salaries, wages and bonus was primarily due to a 23.23% increase in the number of employees from 866 employees at March 31, 2024 to 1,058 employees at March 31, 2025 with new employees being recruited at various salary levels, as well as salary increments for certain employees. However, our employee benefits expense as a percentage of revenue from operations decreased by 5.06% in Fiscal 2025 as compared to Fiscal 2024.
Finance costs
Our finance costs increased by 131.43% to 146.31 million for Fiscal 2025 from 63.22 million for Fiscal 2024. This increase was primarily due to a 219.66% increase in interest expenses to 131.22 million for Fiscal 2025 from 41.05 million for Fiscal 2024, which was in turn primarily due to a 195.90% increase in interest expense on borrowings to 91.73 million for Fiscal 2025 from 31.00 million for Fiscal 2024, and a 292.94% increase in lease liabilities to 39.49 million for Fiscal 2025 from 10.05 million for Fiscal 2024.
Depreciation and amortisation expense
Our depreciation and amortisation expense increased by 99.98% to 341.90 million for Fiscal 2025 from 170.97 million for Fiscal 2024, primarily due to an increase in depreciation of property, plant and equipment by 106.07% to 255.46 million for Fiscal 2025 from 123.97 million for Fiscal 2024.
Other expenses
Our other expenses increased by 40.23% to 1,648.40 million for Fiscal 2025 from 1,175.52 million for Fiscal 2024. Our other expenses increased primarily due to a 93.98% increase in our job work and labour charges to 362.57 million for Fiscal 2025 from 186.91 million for Fiscal 2024, a 57.86% increase in power and fuel to 333.31 million for Fiscal 2025 from 211.14 million for Fiscal 2024, and a 150.73% increase in freight and forwarding charges to 128.25 million for Fiscal 2025 from 51.15 million for Fiscal 2024. The increase in job work and labour charges was primarily due to a requirement for additional capacity to fulfil customer orders, the increase in power and fuel was primarily due to a combination of increased sales and utility charges, and the increase in freight and forwarding charges was primarily due to increase sales orders. The foregoing was offset slightly by a decrease in royalty expenses by 60.12% to 129.64 million for Fiscal 2025 from 325.08 million for Fiscal 2024, which was due to a decrease in royalty related fulfilled orders in Fiscal 2025 as compared to Fiscal 2024.
Income Tax expense
Our total tax expense increased by 26.47% to 387.95 million for Fiscal 2025 from 306.75 million for Fiscal 2024. Our current tax increased by 41.43% to 408.91 million for Fiscal 2025 from 289.13 million for Fiscal 2024. Our total tax expense as a percentage of profit before tax was 25.73% for Fiscal 2025 compared to 26.66% for Fiscal 2024.
Profit for the year
Primarily for the reasons stated above, our profit for the year increased by 32.69% to 1,119.88 million for Fiscal 2025 from 843.96 million for Fiscal 2024.
Financial c ondition
Total assets
The table below sets forth the principal components of our total assets as at dates indicated.
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Non-current assets: | |||
| Property, plant and equipment | 2,356.68 | 1,718.63 | 1,367.20 |
| Right-of-use-asset | 705.76 | 605.92 | 491.58 |
| Capital work in progress | 262.64 | 451.94 | 84.34 |
| Other intangible assets | 2.92 | 1.33 | 2.21 |
| Financial assets: | |||
| (i) Investments | 154.2 | 149.67 | 121.80 |
| (ii) Other financial assets | 197.30 | 59.61 | 73.73 |
| Non-current tax assets (net) | - | 28.20 | - |
| Deferred tax assets (net) | 0.76 | 0.56 | - |
| Other non-current assets | 38.26 | 195.53 | 83.14 |
| Total non-current assets | 3,718.52 | 3,211.39 | 2,224.00 |
| Current assets: | |||
| Inventories | 1,948.58 | 1,369.02 | 1,437.11 |
| Financial assets: | |||
| (i) Trade receivables | 2,332.79 | 561.10 | 422.39 |
| (ii) Cash and cash equivalents | 268.29 | 304.94 | 326.80 |
| (iii) Other bank balances | 212.32 | 106.93 | 1,106.13 |
| (iv) Loans | - | 155.69 | - |
| (v) Other financial assets | 188.74 | 238.38 | 26.57 |
| Other current assets | 381.48 | 376.53 | 304.41 |
| Total current assets | 5,332.20 | 3,112.59 | 3,623.41 |
| Total assets | 9,050.72 | 6,323.98 | 5,847.41 |
Our total non-current assets were 2,224.00 million as at March 31, 2024 and increased by 44.40% to 3,211.39 million as at March 31, 2025 and 15.79% to 3,718.52 million as at March 31, 2026. The increase in our non-current assets from March 31, 2024 to March 31, 2025 was primarily due to an increase in property, plant and equipment from 1,367.20 million as at March 31, 2024 to 1,718.63 million as at March 31, 2025, as well as an increase in capital work in progress from 84.34 million as at March 31, 2024 to 451.94 million as at March 31, 2025. The increase in property, plant and equipment was primarily due to business expansion to cater to increasing customer demand and the increase in capital work in progress was primarily due to the time taken to install additional capacity in downstream processes which resulted in an increase in work in progress from upstream processes. The increase in our non-current assets from March 31, 2025 to March 31, 2026 was primarily due to an increase in property, plant and equipment from 1,718.63 million as at March 31, 2025 to 2,356.68 million as at March 31, 2026, an increase in right-of-use-asset from 605.92 million as at March 31, 2025 to 705.76 million as at March 31, 2026 and an increase in other financial assets from 59.61 million as at March 31, 2025 to 197.30 million as at March 31, 2026. The increase in property, plant and equipment was primarily due to capitalisation of plant and machinery, increase in right-of-use-asset was primarily due to addition in the leasehold land and building, and an increase in other non- current financial assets was primarily due to bank deposit having remaining maturity of more than 12 months grouped under non-current assets.
Our inventories were 1,437.11 million as at March 31, 2024, and decreased by 4.74% to 1,369.02 million as at March 31, 2025 and increased by 42.33% to 1,948.58 million as at March 31, 2026. The increase in our inventories from March 31, 2025 to March 31, 2026 was primarily due to increase in finished goods and postponement of sales to first quarter of Fiscal 2027.
Our other bank balances were 1,106.13 million as at March 31 2024, and decreased by 90.33% to 106.93 million as at March 31, 2025 and increased by 98.55% to 212.32 million as at March 31, 2026. The decrease in our other bank balances from March 31, 2024 to March 31, 2025 was primarily due to the acquisition of ECFPL in a cash transaction and capital investments to make upgrades to our manufacturing facility. The increase in our other bank balances from March 31, 2025 to March 31, 2026 was primarily due to pre-IPO funds raised during the year.
Our trade receivables increased from 422.39 million as at March 31, 2024 to 561.10 million and increased to 2,332.79 million as at March 31, 2026. The increase in trade receivables from March 31, 2024 to March 31, 2025 was primarily due to the increase in our revenue from operations in Fiscal 2025 compared to Fiscal 2024. The increase in trade receivables from March 31, 2025 to March 31, 2026 was primarily due to the majority of our sales happening in the fourth quarter of Fiscal 2026.
Current loans increased from nil as at March 31, 2024 to 155.69 million as at March 31, 2025 and decreased to nil as at March 31, 2026. The decrease in current loans from March 31, 2025 to March 31, 2026 was due to the repayment by the relevant counterparties of loans that had been extended by the Company during Fiscal 2025. Our other financial assets were 26.57 million as at March 31, 2024 and increased by 797.06% to 238.38 million as at March 31, 2025 and decreased by 20.83% to 188.74 million. The increase in other financial assets from March 31, 2024 to March 31, 2025 was primarily due to an increase in earnest money deposits (EMDs)/security deposits to secure a government tender by 981.32% to 234.43 million as at March 31, 2025 from 21.68 million as at March 31, 2024. The increase in other financial assets from March 31, 2025 to March 31, 2026 was primarily due to an increase in fixed deposits.
Total equity and liabilities
The table below sets forth the principal components of our total equity and liabilities as at the dates indicated.
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Equity: | |||
| Equity share capital | 119.00 | 101.49 | 19.90 |
| Other equity | 4,910.54 | 2,476.03 | 1,383.69 |
| Total equity | 5,029.54 | 2,577.52 | 1,403.59 |
| Liabilities: | |||
| Non-current liabilities: | |||
| Financial liabilities: | |||
| (i) Borrowings | 851.19 | 757.64 | 348.05 |
| (ii) Lease liabilities | 574.50 | 479.30 | 368.31 |
| Deferred tax liabilities (net) | 25.45 | 17.10 | 34.97 |
| Employee benefit obligations | 20.16 | 25.52 | 17.90 |
| Total non-current liabilities | 1,471.30 | 1,279.56 | 769.23 |
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Current liabilities: | |||
| Financial Liabilities: | |||
| (i) Borrowings | 1,384.63 | 1,707.37 | 417.28 |
| (ii) Lease liabilities | 74.26 | 77.56 | 54.38 |
| (iii) Trade payables: | |||
| - Total outstanding dues of micro and small enterprises | 26.13 | 50.42 | 14.32 |
| - Total outstanding dues other than micro and small enterprises | 641.49 | 421.65 | 508.40 |
| (iv) Other financial liabilities | 117.31 | 103.98 | 1,337.32 |
| Employee benefit obligations | 1.67 | 9.07 | 5.32 |
| Other current liabilities | 148.10 | 96.85 | 1,307.87 |
| Current tax liabilities (net) | 156.29 | - | 29.70 |
| Total current liabilities | 2,549.88 | 2,466.90 | 3,674.59 |
| Total liabilities | 4,021.18 | 3,746.46 | 4,443.82 |
| Total equity and liabilities | 9,050.72 | 6,323.98 | 5,847.41 |
Our total equity increased from 1,403.59 million as at March 31, 2024 to 2,577.52 million as at March 31, 2025 and further increased to 5,029.54 million as at March 31, 2026. These increases were primarily due to increases in other equity, which increased from 1,383.69 million as at March 31, 2024 to 2,476.03 million as at March 31, 2025 and further increased to 4,910.54 million as at March 31, 2026, which was in turn primarily due to retained earnings and issue of Compulsory Convertible preference Share at Premium.
Our total non-current liabilities increased from 769.23 million as at March 31, 2024 to 1,279.56 million as at March 31, 2025 and further increased to 1,471.30 million as at March 31, 2026. The increase in total non-current liabilities as at March 31, 2025 was primarily due to an increase in non-current borrowings from 348.05 million as at March 31, 2024 to 757.64 million as at March 31, 2025, which was primarily due to certain payment tranches for term loans from banks becoming due during Fiscal 2025. The increase in total non-current liabilities as at March 31, 2026 was primarily due to increase in non-current borrowing from 757.64 million as at March 31, 2025 to 851.19 million as at March 31, 2026 and increase in lease liability from 479.30 million as at March 31, 2025 to 574.50 million as at March 31, 2026.
Our total current liabilities decreased from 3,674.59 million as at March 31, 2024 to 2,466.90 million as at March 31, 2025 and increased to 2,549.88 million as at March 31, 2026. The decrease in total current liabilities as at March 31, 2025 was primarily due to a decrease in advances from customers from 1,264.61 million as at March 31, 2024 to 27.44 million as at March 31, 2025, coupled with the absence of any purchase consideration payable as compared to the purchase consideration of 1,118.53 million payable as at March 31, 2024 for the Companys acquisition of ECFPL, and partially offset by an increase in current borrowings from 417.28 million as at March 31, 2024 to 1,707.37 million as at March 31, 2025 that was primarily attributable to an increase in a working capital demand loan from a bank. The foregoing purchase consideration payable as at each of March 31, 2024 has been recorded as a component of, and is reflected in, our other financial liabilities. Our other financial liabilities as at each of March 31, 2026, March 31, 2025, and 2024 also included bonus payable to certain of our related parties. The increase in total current liabilities as at March 31, 2026 was primarily due to increase in trade payable from 472.07 million as at 31 March, 2025 to 667.62 million, and an increase in current tax liability (Net) from nil as at 31 March, 2025 to 156.29 million as at March 2026.
Liquidity and capital resources
Our liquidity requirements primarily relate to operational costs incurred in the ongoing conduct of our business activities. Our sources of liquidity for Fiscals 2026, 2025 and 2024 were primarily borrowings from banks and financial institutions.
As at March 31, 2026 our cash and cash equivalents aggregated to 268.29 million.
Cash flows
The following table sets forth a summary of our cash flows for the fiscal years indicated.
| Year ended March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Net cash flows generated from/(used in) operating activities | 282.58 | (1,549.76) | 2,009.64 |
| Net cash flows generated from/(used in) investing activities | (1,026.59) | 20.62 | (1,995.80) |
| Net cash flows generated from/(used in) financing | 697.47 | 1,507.49 | 211.84 |
| Cash and cash equivalents at the beginning of the year | 304.94 | 326.80 | 101.12 |
| Net increase/(decrease) in cash and cash equivalents | (46.54) | (21.66) | 225.68 |
| Foreign currency translation reserve | 9.88 | (0.20) | - |
| Cash and cash equivalents at the end of the year | 268.29 | 304.94 | 326.80 |
Operating activities
Fiscal 2026
Net cash flows used in our operating activities were 282.58 million for Fiscal 2026. Our profit before tax from continuing operations was 1,349.58 million, which was adjusted for non-cash and other items in a net amount of 727.96 million, resulting in an operating profit before working capital changes of 2,077.50 million. The key adjustments to our cash flow from operating activities included depreciation and amortisation expenses of 466.89 million and finance costs of 242.31 million.
Fiscal 2025
Our profit before tax from continuing operations was 1,507.83 million, which was adjusted for non-cash and other items in a net amount of 443.82 million, resulting in an operating profit before working capital changes of 1,951.65 million. The key adjustments to our cash flow from operating activities included depreciation and amortisation expenses of 341.90 million and finance costs of 130.81 million. Changes in operating assets and liabilities resulted in cash used in operations of 1,111.11 million. The material adjustments made to operating profit before working capital changes for operating assets were:
(i) a 380.76 million increase in loans and other financial assets;
(ii) a 133.48 million increase in trade receivables; and
(iii) a 100.35 million increase in other assets, which were partially offset by a 68.09 million decrease in inventories.
The material adjustments made to operating profit before working capital changes for operating liabilities were:
(i) a 1,260.89 million decrease in other financial liabilities;
(ii) a 1,211.02 million decrease in other liabilities; and
(iii) a 50.12 million decrease in trade payables. Income tax paid (net) of 438.66 million resulted in net cash flows used in our operating activities of 1,549.76 million for Fiscal 2025.
Fiscal 2024
Net cash flows generated from our operating activities were 2,009.64 million for Fiscal 2024. Our net profit before tax was 1,150.71 million, which was adjusted for non-cash and other items in a net amount of 159.90 million, resulting in an operating profit before working capital changes of 1,310.61 million. The key adjustments to our cash flow from operating activities included depreciation and amortisation expenses of 170.97 million.
Investing activities
Fiscal 2026
Net cash flows used in investing activities were 1,026.59 million during Fiscal 2026. The key adjustments to our cash flow from investing activities were investment in bank deposits of 1,374.41 million and payment for purchase of property, plant and equipment of 693.81 million which were partially offset by proceeds from bank deposits of 1,018.28 million.
Fiscal 2025
Net cash flows generated from investing activities were 20.62 million during Fiscal 2025. The key adjustments to our cash flow from investing activities included proceeds from bank deposits of 1,030.99 million, which were partially offset by payments for capital work in progress, payments for capital advances and payments to certain creditors in the aggregate amount of 452.41 million, and payments for the purchase of property, plant and equipment of 613.71 million.
Fiscal 2024
Net cash flows used in investing activities were 1,995.80 million during Fiscal 2024. The key adjustments to our cash flow from investing activities were investments in bank deposits of 1,139.12 million, and payments for the purchase of property, plant and equipment of 780.42 million.
Financing activities
Fiscal 2026
Net cash flows generated from financing were 697.47 million during Fiscal 2026. The key adjustments to our cash flow from financing activities were proceeds from borrowings of 8,145.81 million, which were partially offset by the repayment of borrowings of 8,375.00 million.
Fiscal 2025
Net cash flows generated from financing were 1,507.49 million during Fiscal 2025. The key adjustments to our cash flow from financing activities were proceeds from borrowings of 1,832.33 million, which were partially offset by the repayment of borrowings of 139.99 million.
Fiscal 2024
Net cash flows generated from financing were 211.84 million during Fiscal 2024. The key adjustments to our cash flow from financing activities were proceeds from borrowings of 370.67 million, which were partially offset by the repayment of borrowings of 82.67 million.
Borrowings
As at March 31, 2026, we had total borrowings of 2,235.83 million, which consisted of non-current borrowings and current borrowings.
We are bound by restrictive and other covenants in our facility agreements with various lenders, including but not limited to, restrictions on the utilisation of the loan for certain specified purposes, timely provision of information and documents, timely creation of security, obtaining prior consent and waiver from existing lenders and maintenance of financial ratios, including debt to tangible net worth, debt-service coverage ratio and fixed assets coverage ratio. Further, most of our loan documents contain restrictive covenants that require us to obtain prior written approval from the appropriate lender for various corporate actions, including effecting any change in the composition or management or the shareholding or capital structure of our Company, any merger, amalgamation, acquisition, compromise or other restructuring. Our term loans and working capital facilities are secured by, among others, a charge over material, stock in process, current assets and moveable assets, fixed deposits, demand promissory notes and personal guarantees from certain of our Promoters.
In Fiscal 2025, our Company breached a financial covenant in one of our loan agreements where our Companys current ratio (being the total current assets divided by the total current liabilities), calculated on a standalone basis, fell below the prescribed threshold in the loan agreement. The lender has waived the said breach. For more details on the risks arising from covenants of such nature, see Risk Factors 20. Our financing agreements contain covenants that limit our flexibility in operating our business. Any future failure to meet the conditions under our financing arrangements or obtain any consents thereunder could have a material adverse effect on our business, financial condition, results of operations and cash flows . on page 40.
The following table provides the types and amounts of our outstanding borrowings as at the dates indicated.
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Non-current borrowings (less: current maturities of long-term borrowings) [A] | 851.19 | 757.64 | 348.05 |
| Of which secured: | 851.19 | 757.64 | 348.05 |
| Current borrowings (including current maturities of long-term borrowings) [B] | 1,384.63 | 1,707.37 | 417.28 |
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Of which secured: | 1,384.63 | 1,707.37 | 417.28 |
| Total Borrowings [C = A + B] | 2,235.82 | 2,465.01 | 765.33 |
For further details of security, repayment terms and interest rates for our borrowings, ?? Restated Financial Information Note 23 Borrowings on pages 301.
Contractual maturities of financial liabilities
The following table summarises the undiscounted maturity profile of the Groups financial liabilities on an undiscounted basis as at March 31, 2026.
| Payment due by period | ||||
| Particulars | Total | Less than 1 year | 1-5 years | More than 5 years |
| in million | ||||
| Borrowings | 2,235.82 | 1,384.63 | 851.19 | Nil |
| Lease liabilities | 825.98 | 121.29 | 488.17 | 216.52 |
| Trade payables | 667.61 | 634.32 | 33.29 | Nil |
| Other financial liabilities | 103.98 | 103.98 | Nil | Nil |
| Total | 3,833.40 | 2,244.22 | 1,372.65 | 216.52 |
Capital Expenditure
The following table sets forth net additions to property, plant and equipment by category for the fiscal years indicated.
| Particulars | Fiscal 2026 | Fiscal 2025 | Fiscal 2024 |
| in million | |||
| Additions: | |||
| Freehold lands | - | - | - |
| Buildings | 5.85 | - | 1.00 |
| Leasehold improvements | 199.37 | 46.63 | 9.64 |
| Electrical installation | 23.65 | 10.09 | 25.05 |
| Plant and machinery (1) | 854.32 | 490.48 | 618.23 |
| Furniture and fixtures | 12.85 | 7.37 | 3.21 |
| Office equipment | 20.97 | 10.04 | 5.92 |
| Factory equipment | - | - | - |
| Vehicles | - | 45.46 | 3.52 |
| Computers | 1.87 | 3.62 | 2.47 |
| Total additions [A] | 1,118.88 | 613.69 | 669.04 |
| Disposals: | |||
| Plant and machinery | 15.13 | 15.37 | 21.54 |
| Furniture and fixtures | - | 0.07 | - |
| Vehicles | - | 0.04 | 12.38 |
| Computers | 0.86 | - | - |
| Total disposals (2) [B] | 16.00 | 15.48 | 33.92 |
| Net additions to property, plant and equipment (3) [C = A-B] | 1,102.88 | 598.21 | 635.12 |
Notes:
(1) During Fiscals 2026, 2025 and 2024, we capitalised borrowing costs of 27.52 million, 0.29 million and 13.70 million, respectively.
(2) Only those line items for which there were disposals are included under the disposals in this table.
(3) Net additions to property plant and equipment are before depreciation. For more details, see Restated Financial Information Note 6 Property, Plant and Equipment on page 292.
Contingent liabilities and capital commitments
The following table sets our contingent liabilities and capital commitments as at March 31, 2026, March 31, 2025 and March 31, 2024.
| As at March 31, | |||
| Particulars | 2026 | 2025 | 2024 |
| in million | |||
| Contingent liabilities: | |||
| Letter of credit | 40.79 | 53.11 | 47.12 |
| Bank Guarantee | 1,038.77 | - | - |
| Corporate guarantee given to related party | - | - | 75.00 |
| Income Tax Demand | 10.14 | - | - |
| Capital commitments: | |||
| Plant and machinery | 58.33 | 852.70 | 570.19 |
Off-balance sheet arrangements
We do not have any off-balance sheet arrangements or other relationships with any entity that have been established for the purposes of facilitating off-balance sheet arrangements.
Quantitative and qualitative disclosure on market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, and other market changes that affect market risk sensitive instruments. Financial instruments affected by market risk include borrowings and derivative financial instruments. The Group exposed to below two market risks, interest rate risk and foreign currency risk. Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Groups exposure to the risk of changes in market interest rates relates primarily to the Groups borrowings with floating interest rates.
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Groups exposure to the risk of changes in foreign exchange rates relates primarily to the Groups trade receivable and trade payable.
For quantitative disclosures on the Groups market risk, see Restated Financial Information Note 48
Financial Risk Management Objectives and Policies (a) Market risk on page 317.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. Credit risk arises principally from the Groups trade receivables, loans, security deposits, bank balances and other financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Group assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.
For quantitative disclosures on the Groups credit risk, see Restated Financial Information Note 48 Financial
Risk Management Objectives and Policies (b) Credit risk on page 317.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they become due. The Group manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities.
For quantitative disclosures on the Groups liquidity risk, see Restated Financial Information Note 48
Financial Risk Management Objectives and Policies (c) Liquidity risk on page 317.
Reservations, qualifications and adverse remarks
There are no reservations, qualifications or adverse remarks in the Statutory Auditors examination report on the Restated Financial Information that requisite any adjustments to the Restated Financial Information.
The Statutory Auditors have included certain observations in the annexure to their reports on our Companys audited financial statements for the years ended March 31, 2026, March 31, 2025 and March 31, 2024, as required under the Companies (Auditors Report) Order, 2020, which do not require any adjustment to the Restated Financial Information. For more details, see Risk Factors 7. Certain observations have been included in the Statutory Auditors report on our audited standalone financial statements for the years ended March 31, 2026, March 31, 2025 and March 31, 2024 as required under the Companies (Auditors Report) Order, 2020 on page 28.
The Statutory Auditors have also identified limitations in the audit trail functionality of our accounting software for Fiscal 2025, which may impact our compliance with Rule 11(g) of the Companies (Audit and Auditors) Rules.
For more details, see Risk Factors 17. The audit trail functionality of our accounting software for Fiscals 2025 and 2024 was not in compliance with Rule 11(g) of the Companies (Audit and Auditors) Rules on page 38 and
Restated Financial Information Note 52 Other Matters Audit Trial on page 325.
The above observations have been included in Annexure VI Part C to the Restated Financial Information. For more details, see Restated Financial Information Part A on page 290.
Unusual or infrequent events or transactions
Other than as described in this section and Our Business , Risk Factors and History and Certain Corporate Matters on pages 183, 23 and 222, respectively, there have been no events or transactions which may be described as unusual or infrequent.
Significant economic changes that materially affected or are likely to affect revenue from operations
Other than as described in this section, and in Our Business , Risk Factors and Industry Overview on pages 183, 23, and 135, respectively, there have been no significant economic changes that materially affected or are likely to affect our revenue from operations.
Known trends or uncertainties that have had or are expected to have a material adverse effect on revenue from operations or other income
Except as described in this section and in Risk Factors on page 23, to our knowledge, there are no trends or uncertainties that have had, or are expected to have, a material adverse effect on our revenue from operations or other income.
Total turnover of each major operating segment in which the issuer operated
In accordance with Ind AS 108 on Operating Segments, our business activities, as reviewed by the management, fall within a single operating segment, namely manufacturing of technical textiles fabrics. Therefore, there are no reportable segments for our Company under the requirements of Ind AS 108 Operating Segments . For more information, see Restated Financial Information Note 45 Segment Reporting on page 315.
Future relationships between costs and revenue
Other than as described in this section and in Our Business and Risk Factors on pages 183 and 23, respectively, there are no known factors that are expected to have an effect on our costs and revenue.
Material increases in revenues and sales
Material increases in our revenues and sales are primarily due to the reasons described in Significant Factors Affecting our Results of Operations and Financial Condition on page 333.
New products or business segments
Our results of operations were materially affected by the launch of new products. For details, see Significant Factors Affecting our Results of Operations and Financial Condition - Our Ability to Upgrade our Existing Products and Introduce New Products on page 336. We did not enter into any new business segments.
Seasonality
Our financial condition and results of operations were not materially affected by seasonal factors.
Customer and supplier concentration
Our Company has a customer concentration. For details, ?? Risk Factors 2. Our top customer and our top 10 customers contributed 11.13% and 59.52%, respectively, of our revenue from contracts with customers for Fiscal 2026. Any decrease in sales to such customers or the loss of such customers could have an adverse effect on our business, results of operations, financial condition and cash flows on page 25.
Our Company has a supplier concentration. For details, see Risk Factors 6. In order to get better pricing by buying in larger volumes, we generally buy the primary materials we need from a few suppliers. For Fiscal 2026, our cost of materials consumed purchased from our top 10 suppliers represented 51.42% of our cost of materials consumed. We have not entered into long-term agreements with these suppliers and if any of our top 10 suppliers ceased selling us the materials we require in the quantities we need, and we were unable to find a supplier to replace it, it could have a material adverse effect on our business, financial condition, results of operations and cash flows on page 27.
Competitive conditions
For a description of the competitive conditions in the industries in which we operate, ?? Our Business Competition and Industry Overview on pages 208 and 135, respectively.
Material developments after March 31, 2026
There have been no material developments, and no circumstances have arisen after March 31, 2026, that materially and adversely affects, or are likely to affect, our trading, revenue, profitability, performance, prospects, value of our assets, or our ability to pay our liabilities within the next 12 months.
IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000
IIFL Capital Services Support WhatsApp Number
+91 9892691696
Download The App Now
Follow us on
2026, IIFL Capital Services Ltd. All Rights Reserved
IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132 (Member ID - NSE: 10975 BSE: 179 MCX: 55995 NCDEX: 01249), DP SEBI Reg. No. IN-DP-185-2016, PMS SEBI Regn. No: INP000002213, IA SEBI Regn. No: INA000000623, Merchant Banker SEBI Regn. No. INM000010940, RA SEBI Regn. No: INH000000248, BSE Enlistment Number (RA): 5016, AMFI-Registered Mutual Fund Distributor & SIF Distributor
ARN NO : 47791 (Date of initial registration – 17/02/2007; Current validity of ARN – 08/02/2027), PFRDA Reg. No. PoP 20092018, IRDAI Corporate Agent (Composite) : CA1099
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.
