Dear Shareholders,
Your Directors hereby present the 64th Annual Report of your Company along with the financial results for the year ended 31st March, 2026.
State of affairs of the company
a. Financial results
| Particulars | 31.03.2026 | 31.03.2025 |
| Revenue from operations | 88,555 | 86,819 |
| EBITDA | 11,592 | 11,525 |
| Less: Finance cost | 3,720 | 2,869 |
| Profit after finance cost | 7,872 | 8,656 |
| Less: Depreciation | 2,877 | 1,865 |
| Profit Before Tax | 4,995 | 6,791 |
| Add/(Less): Exceptional Items | - | - |
| PBT (After Exceptional items) | 4,995 | 6,791 |
| Less: Tax Expenses | 1,201 | 1,614 |
| Taxation for earlier years | 209 | - |
| Profit after tax from continuing operations | 3,585 | 5,177 |
| Less: Discontinued Operations (net of taxes) | - | (1,889) |
| Net Profit for the year | 3,585 | 3,289 |
| Other Comprehensive Income | (1) | (80) |
| Total Comprehensive Income for the year | 3,584 | 3,208 |
b. Dividend and transfer to reserves
The Board have proposed a dividend of Rs. 4/- per share (40% on face value of Rs. 10/-each) for the financial year for the financial year 2025-26 which is subject to the approval of shareholders at the Annual General Meeting (AGM). The Directors have not recommended any transfer to the reserves.
Industry overview
FY 2025-26 was a turbulent year for the Indian Textile and Clothing Industry. One of the main reasons for this turbulence was the uncertainty over US tariffs. The US is a major export destination for Indian textile products, accounting for 30% of the sectors exports. After agreeing in February 2025 to work towards a $500 billion bilateral trade target, the US announced a 26% tariff on Indian goods, comprising a 10% baseline tariff and a 16% reciprocal tariff on April 2nd. The reciprocal tariff component was then suspended for 90 days to allow for negotiations. In July, the US announced a 25% tariff on Indian goods, effective August 7, citing concerns over Russian oil purchases. In August, the tariffs
were raised to 50%, with an additional 25% penalty added to the previous 25%. This situation lasted until the Supreme Court struck down the tariffs in February and caused severe uncertainty for exporters doing business with the US. Many were forced to give discounts of varying degrees to ensure continuity of business while others lost orders. The effect was felt in the entire supply chain with certain clusters like Tirupur, Surat and Karur badly affected.
Demand for yarn was subdued for most of the year in both domestic and export markets with the tariff uncertainty, geopolitical tensions and low economic growth affecting consumer sentiment and demand. Cotton prices remained stable through the year with international growths priced competitively when compared to Indian cotton. The relaxation of the import duty on cotton from August to December helped the industry procure cotton at reasonable prices and helped keep domestic prices in check.
Global demand for hygiene products was stable with US retail sales growing by 3.7% in 2025 driven by resilient consumer spending despite economic uncertainty. EU retail sales experienced a mild recovery in 2025, with total sales volumes increasing by 2.3% year-on-year, driven by stronger performance in the second half of the year.
Indian textile and apparel exports declined by 2.2% in dollar terms in FY 25-26, decreasing to $ 35.8 billion from $ 36.6 Billion in the previous fiscal. This decrease was driven primarily by the uncertainty of the tariff situation in the US and the weakness of the rupee which depreciated by close to 10% during the year.
Review of operations
The Company was able to maintain good operational efficiencies and capacity utilisation levels across units. The discontinuation of operations of our Hindupur unit was managed smoothly and shifting of assets, including the solar power plant, to other units was largely completed. The addition of 8400 spindles in the Kanjikode unit was completed during the fourth quarter and the benefits will accrue during the current year and subsequent years. The company continued to improve productivity levels and optimize the product mix to maximise profitability in its spinning units. Despite the tariff uncertainties, the technical textile division registered a 12% growth in top line during the year and the planned installation of the cotton buds machines is in progress. The Company registered total revenues of Rs. 88,871 Lakhs in FY 25-26 compared to Rs. 87,251 Lakhs in the previous year. The EBITDA of the Company was Rs. 11,592 Lakhs in FY 25-26 as compared to Rs. 11,525 lakhs in FY 24-25 and the Net Profit stood at Rs. 3585 Lakhs vis a via Rs. 3289 lacs in the prior year. The companys profitability was affected adversely due to the cost of the rupees depreciation on its foreign currency liabilities and the higher depreciation charge due to the added capacity in the technical textile division.
Outlook for the current year
We are currently in a very volatile phase irrespective of where one
lives, operates or conducts business globally. Geopolitical tensions have seldom been higher and the world seems to be lurching from one crisis to another every minute, or so it seems. The conflict involving Iran, the US and the Middle East shows no sign of immediate abatement and the consequences will continue to be felt for quite some time to come. Commodity and Financial markets have reacted strongly to the ongoing issue and costs across the board including freight, packaging, dyes, chemicals, raw materials and fuel have risen dramatically.
Along with the ongoing war in Ukraine, the Iran conflict promises to keep inflation higher than what central banks would like and ensure that economic growth is tempered going forward. While the Indian government has done well to contain the fallout, one feels that the worst is not yet behind us.
Cotton prices have risen dramatically post the start of the Iran conflict, both in the international and domestic markets. Cotton futures for July delivery increased from a low of 64 cents in February to 87 cents on May 14th. Indian prices have kept pace, rising from Rs. 55,800 per candy to Rs. 68,300 in the same time frame. Yarn prices have increased significantly as well and demand for yarns has been strong since December driven by strong export demand and a reemergence of Chinese buying. But resistance is already forming in the down stream sectors and we will have to see if there is some demand destruction for cotton products at these elevated price levels. To conclude, FY 26-27 has started out with a great deal of volatility and one hopes that peace in the Middle East will lend some stability going forward.
Personnel
The Company has been able to in maintaining cordial relations with its labour force in all its units. The Company has 1250 permanent employees on the roll as on 31s1 March, 2026.
Internal Control Systems & Risk Management
The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable Regulations. The systems are periodically reviewed by the Audit Committee of the Board, for identification of deficiencies and necessary timely corrective actions were taken to improve controls at all levels. The committee also reviews the statutory auditors report, key issues, significant processes and accounting policies.
The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Directors confirm that the Internal Financial Controls are adequate with respect to the operations of the Company. A report of Auditors certifying the adequacy of Internal Financial Controls is annexed with the Auditors Report.
As per Regulation 17(9) of SEBI (LODR) 2015 The Company has adopted a risk management plan for identifying and managing risk. The Board identifies and reviews the various elements of risk which the company has to face and has laid out the procedures
and measures for mitigating those risks. The elements of risk threatening the companys existence are minimal.
The company does not face any risk other than those that are prevalent in the industry and has taken all possible steps to overcome such risks. The main concerns are volatility in raw material prices and fluctuations in foreign exchange rates. Effective planning in raw material purchase and the ability to pass on raw material price increases to its customers has minimized the risk relating to the volatility in raw material prices.
Foreign exchange fluctuation risk is minimized through proper planning and natural hedging of export receivables and foreign currency borrowings. As a part of the overall risk management strategy, all assets are appropriately insured.
Number of meetings of the Board
Details of the number of meetings of the Board and Committees thereof and the attendance particulars of the Directors in such meetings are provided under the Corporate Governance Report.
Declaration by Independent Directors
The Independent Directors have submitted their disclosures to the Board confirming that they fulfill the requirements enumerated under Section 149(6) of the Companies Act, 2013 (hereinafter "the Act") and Regulation 25 of The Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,2015.
Directors and Key Managerial Personnel (KMP) Appointments, Retirements and Resignations
During the financial year under review:
Mr Ashwin Chandran, Chairman and Managing Director who is liable to retire by rotation was re-appointed by the shareholders in the Annual General meeting held on 20.08.2025.
Mr Prasanth Chandran, was appointed as the Vice Chairman and Managing Director of the company for a period 3 years from 01.04.2026 to 31.03.2029 at the Annual general Meeting held on 20.08.2025
Mr T Kumar was appointed as the Executive Director of the Company for a period 3 years from 01.04.2026 to 31.03.2029 at the Annual general Meeting held on 20.08.2025 Mr Ravi Kumar Abburu was appointed as the Director- Technical Textiles of the company for a period 3 years from 01.04.2026 to 31.03.2029 at the Annual general Meeting held on 20.08.2025 Mr M Achuth Menon was appointed as the Company Secretary & Compliance officer in the Board meeting held on 10.02.2026 with effect from 13.02.2026.
Mr Satish Kuruppath was appointed as the Chief Financial Officer of the company in the Board Meeting held on 03.03.2026 with effect from 31.03.2026.
The following are the whole-time key managerial personnel of the Company as per Section 203 of the Act as on 31st March,2026,
(i) Mr. Ashwin Chandran, Chairman and Managing Director
(ii) Mr Prasanth Chandran Managing Director (iii) Satish
Kuruppath, Chief Financial Officer & (iv) Mr. M Achuth Menon, Company Secretary.
Performance Evaluation
The Board of Directors at their meeting held on 10th February, 2026, had carried out an annual evaluation of its own performance and the performance of the Committees of the Board and the individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015 (hereinafter "Listing Regulations").
The performance of the Board was evaluated by the Board of Directors after seeking inputs from all the Directors on the basis of criteria such as Board composition and structure, effectiveness of the Board meetings and process and contributions made by the Directors.
The performance evaluation of each Director was done by the entire Board of Directors, excluding the Director being evaluated, taking into consideration inputs received from the other Directors, covering various aspects of the Boards functioning such as active participation and contribution during discussions, effective deployment of knowledge and expertise towards the growth and betterment of the Company, impact and influence on the growth of the Company and performance of specific duties, obligations and governance.
The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of the committees and effectiveness of the committee meetings.
In a separate meeting of Independent Directors held on 25th March, 2026 performance of the non-independent Directors, performance of the Board as a whole and performance of the Chairman were evaluated, taking into account the views of the executive Directors and non-executive Directors.
The Board also carried out an evaluation on the performance of the Independent Directors and also verified the fulfilment of the criteria for independence as specified under listing Regulations and their independence from the management. This evaluation of Independent Directors was done by the entire Board, excluding the Independent Directors being evaluated.
Policy on Directors appointment and remuneration and other details
The Companys policy on Directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report.
Auditors report and Secretarial Auditors report
The auditors report and secretarial auditors report do not contain any qualifications, reservation or adverse remarks. During the financial year under review, neither the Statutory auditors nor the Secretarial Auditor have reported to the Audit Committee, any
instances of fraud committed against the Company by its officers or employees.
The report of the Secretarial Auditor is furnished as Annexure A and forms part of this report.
Receipt of any commission by Whole Time Directors from the Company or receipt of commission/remuneration from subsidiary Company
During the year under review all the Executive Directors have received commission from the Company. They have not received any commission/ remuneration from subsidiaries during the year under review.
Annual Return
The extract of the annual return pursuant to Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the website of the Company www.precot.com under investor relations.
Secretarial Standards
The Company complies with all the applicable mandatory secretarial standards issued by the Institute of Company Secretaries of India.
Particulars of Employees
The particulars as required under Section 197(12) of Companies Act 2013 read with rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in Annexure B.
Consolidation of Accounts
The Company has control over "Suprem Associates", a partnership firm by holding majority of the Capital in the firm. The accounts of the said firm is consolidated as per the requirement of Indian Accounting Standards (IndAS).
Maintenance of Cost Records
The Company is maintaining the cost records as specified under Section 148(1) of the Companies Act, 2013.
Audit Committee
The Company has constituted an Audit Committee as per Section 177 of the Act and Listing Regulations.
The details pertaining to vigil mechanism, composition and meetings of the Audit Committee are included in the Corporate Governance Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
The details as required under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, is detailed in Annexure C.
Corporate Governance
A report on corporate governance is furnished as Annexure D and forms part of this report. This includes other disclosures as
required under the provisions of the Act. The Company has complied with the conditions relating to corporate governance as stipulated in Regulation 34 of the Listing Regulations.
Corporate Social Responsibility (CSR)
The CSR Committee comprises of 1. Mr. Ashwin Chandran, 2. Mr. Prashanth Chandran and 3. Mr. Vijay Raghunath. This committee takes care of CSR policy execution to ensure that the CSR objectives of the Company are met. The CSR policy deals with allocation of funds, activities, identification of programmes, approval, implementation, monitoring and reporting.
For the financial year 2025-26, the Company spent Rs. 21,11,213 on CSR activities as per the provisions of the Companies Act. Annual report on Corporate Social Responsibility is provided in Annexure E.
The CSR policy is available on the Companys website http://www.precot.com/investors .
Particulars of Loan, Guarantees or Investments
Details as per the provisions of Section 186 of the Act, is given under notes to financial statements.
Related Party Transactions
None of the transactions with related parties falls under the scope of Section 188(1) of the Act. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure F in Form AOC-2 and the same forms part of this report. The Board has approved a policy for related party transactions which is available on the Companys website http://www.precot.com/investors .
Directors responsibility statement
In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm that:
a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the company for that period;
c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) The Directors had prepared the annual accounts on a going concern basis;
e) The Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively;
f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively;
Statutory Auditors
M/s VKS Aiyer & Co., Chartered Accountants (Firm Registration No. 000066S), pursuant to the provisions of Section 139 of the Act, were appointed as the statutory auditors of the Company for a term of 5 years from the conclusion of the 61st AGM till the conclusion of the 66th AGM to be held in the year 2028.
They have confirmed that they are not disqualified and are eligible to continue in the office for the financial year 2026-27.
Cost Auditor
Pursuant to Section 148 of the Act, read with the Companies (Cost Records and Audit) Rules 2014, the Board of Directors, on the recommendation of the Audit Committee, appointed Mr. R Krishnan, Cost Accountant (Associate Regn. No. 7799), as the cost auditor of the Company for the financial year 2026-27. Accordingly, a resolution seeking members ratification for the remuneration payable to Mr. R Krishnan, Cost Auditor is included.
Secretarial Auditor
M/s KSR & Co Company Secretaries LLP Coimbatore has been appointed as the secretarial auditors of the company for a term of 5 consecutive years from financial year 2025-26 till 2029-30.
Insider Trading Regulations
Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, the Insider Trading Code to regulate, monitor and report trading by insiders and the Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information are in force.
Change in nature of business
There was no change in the nature of the business of the Company during the year under review.
Deposits from public
The Company has not accepted any deposits from the public and as such, no amount on account of principal or interest in deposits from public was outstanding as on the date of the balance sheet.
Material Changes
No material changes or commitments affecting the financial position of the Company occurred between the end of the financial year (i.e.31sl March, 2026) and the date of this report.
Vigil Mechanism/ Whistle Blower Policy
The Company has formulated and published a Whistle Blower Policy to provide Vigil Mechanism for employees including Directors of the Company to report genuine concerns and to ensure strict compliance with ethical and legal standards across the Company. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and Listing Regulations, are available on the website of the Company at
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 and constituted an Internal Committee to address the complaints regarding sexual harassment. All employees are covered under this policy.
a. Number of complaints filed during - Nil
the financial year
b. Number of complaints disposed - Nil
of during the financial year
c. Number of complaints pending as - Nil
on end of the financial year
The details relating to Complaints forms part of the Corporate Governance report.
Details of Application made or any proceeding pending under The Insolvency and Bankruptcy Code, 2016 during the year
No applications have been made and no proceedings are pending against the Company under the Insolvency and Bankruptcy Code, 2016 during the year under review.
Details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof
The disclosure under this clause is not applicable as the Company has not undertaken any one-time settlement with the banks or financial institutions during the year under review.
Unclaimed Shares
In accordance with the requirement of Regulation 34(3) and Schedule V Part F of Listing Regulations, the details in respect of equity shares lying in the suspense account is as follows.
| Particulars | Number of share holders | Number of Equity Shares |
| Aggregate number of shareholders and the outstanding shares in the suspense account as on 01-Apr- 2025 | 191 | 36700 |
| Number of shareholders approached the Company for transfer of shares from suspense account during the year | 2 | 250 |
| Number of shareholders to whom shares were transferred from suspense account during the year | 2 | 250 |
| Aggregate number of shareholders and outstanding shares in the suspense account as on 31-Mar- 2026 | 189 | 36450 |
The voting rights on the shares outstanding in the suspense account as on 31s1 March, 2026 shall remain frozen till the rightful owner of such shares claims the shares
Acknowledgement
Your Directors thank the Shareholders, Customers, Suppliers and Bankers for their continued support during the year. Your Directors also place on record their appreciation of the contributions made by Employees at all levels towards the growth of the Company.
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