Rajnandini Fashion India Ltd Management Discussions

The following discussion is intended to convey managements perspective on our financial condition and results of operations for the Fiscals 2025, 2024 and 2023. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our Restated Financial Information as of and for Fiscals 2025, 2024 and 2023, including the related annexures. Unless otherwise indicated or context otherwise requires, the financial information for Fiscals 2025, 2024 and 2023, included herein is derived from the Restated Financial Information, included in this Draft Red Herring Prospectus. For further information, see “Restated Financial Information ” and “Summary of Financial Information ” on page 178 and 51. Our Fiscal year ends on March 31 of each year. Accordingly, all references to a particular Fiscal are to the 12-month period ended March 31 of that year.

This discussion contains forward-looking statements that involve risks and uncertainties and reflects our current view with respect to future events and financial performance. Actual results may differ from those anticipated in these forward- looking statements as a result of factors such as those set forth under “Forward Looking Statements ” and “Risk Factors ” on pages 17 and 24, respectively.

Industry Overview

The Indian textiles and apparel industry is one of the largest globally and a key contributor to the countrys economy. The domestic market is projected to grow at a CAGR of 10% to reach USD 350 billion by 2030, supported by rising incomes, urbanization, and growth in organised retail.

Indias textile and apparel exports stood at approximately USD 35.1 billion in FY23 and are targeted to triple to USD 105 billion by 2030, driven by strengthening domestic manufacturing and expanding international presence. The country is also among the leading global manufacturers of personal protective equipment (PPE), with market size expected to cross USD 92.5 billion by 2025, compared to USD 52.7 billion in 2019.

At the global level, the apparel market is projected to grow at a CAGR of 8% to reach USD 2.37 trillion by 2030, while the global textiles and apparel trade is expected to expand at a CAGR of 4% to USD 1.2 trillion by 2030. India is currently the second-largest producer of textiles and garments and the sixth-largest exporter worldwide, holding a significant share of international trade.

Business Overview

Incorporated in 2010, our Company is primarily engaged in the design, manufacturing and sale of womens apparel, catering to both ethnic and casual wear categories through online and offline channels. Our ethnic wear portfolio includes unstitched dress materials, sarees, kurtis and kurta sets, while the casual wear portfolio comprises tops, tunics and maternity gowns made of poly-cotton, rayon, silk, cotton and other fabrics.

Our sales operations are carried out under two segments - business-to-consumer (B2C) and business-to-business (B2B). In the B2C segment, sales are made directly to individual customers through various e-commerce platforms and our own website i.e. www.rajnandinifashion.com . In the B2C segment, the Company processed 3,89,852 orders during Fiscal 2023, 2,55,856 orders during Fiscal 2024 and 2,78,046 orders during Fiscal 2025.

In the B2B segment, we supply apparel products to wholesalers and retailers and undertake bulk trading of fabrics, including printed design fabrics and dyed plain fabrics, which cater to garment processors and bulk buyers. These trading operations enable us to address a broader segment of the textile value chain. During Fiscal 2023, Fiscal 2024 and Fiscal 2025, the Company generated revenue of 13.22 lakhs, ?408.25 lakhs and ?1,170.31 lakhs, respectively, through B2B segment.

Key Performance Indicators

Our key performance indicators for the last three Fiscals are as follows:

(? In Lakhs except percentages and ratios)

Key Financials Performance	F.Y. 2024-25	F.Y. 2023-24	F.Y. 2022-23
Revenue from Operations(1)	3068.95	2331.84	2800.78
EBITDA(2)	748.28	378.80	102.83
EBITDA margin (%)(3)	24.38%	16.24%	3.67%
PAT(4)	504.82	229.04	37.46
PAT margin (%)(5)	16.45%	9.82%	1.34%
ROE (%)(6)	74.59%	73.92%	26.48%
ROCE (%)(7)	43.22%	34.27%	12.42%
No. of orders delivered (8)	278046	255856	389852

1 Revenue from operation means revenue from sales, service and other operating revenues <² EBITDA is calculated as Profit before tax + Depreciation + finance cost - Other Incomes <³ EBITDA Margin is calculated as EBITDA divided by Revenue from Operations <4) pa t is taken as Profit for the year attributable to the Shareholders of the Company

5 PA T Margin is calculated as Profit for the year attributable to Shareholders of the Company divided by revenue from operations. <⁶⁾ Return on Equity is the ratio ofProfit for the year attributable to Shareholders of the Company and Average Shareholder Equi ty. <⁷⁾ Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders equity plus long-term borrowings and short-term borrowings + deferred tax liability

8 Number of Orders delivered represents the total customer orders fulfilled through e-commerce platforms during the period, indicating the scale of B2C operations and sales performance.

Explanation for KPI metrics:

KPI	Explanations
Revenue from Operations	Revenue from Operations is used by our management to track the revenue profile of the business and in turn helps to assess the overall financial performance of our Company and volume of our business
EBITDA	EBITDA provides information regarding the operational efficiency of the business
EBITDA Margin (%)	EBITDA Margin (%) is an indicator of the operational profitability and financial performance of our business
PAT	Profit after tax provides information regarding the overall profitability of the business.
PAT Margin (%)	PAT Margin (%) is an indicator of the overall profitability and financial performance of our business.
Net Worth	Net worth is used by the management to ascertain the total value created by the entity and provides a snapshot of current financial position of the entity.
ROE (%)	RoE provides how efficiently our Company generates profits from shareholders funds.
ROCE (%)	RoCE provides how efficiently our Company generates earnings from the capital employed in the business.
Number of Orders delivered	It represents the total number of online customer orders successfully delivered during the period. It reflects our operational efficiency, order fulfilment capability, and the demand for our products through online channels. An increase or decrease in this KPI directly indicates trends in customer engagement and online sales performance.

Significant Accounting Policies

Basis of preparation of Financial Statements

The Restated Statement of Assets and Liabilities as at March 31, 2025, March 31, 2024 and March 31, 2023, the Restated Statements of Profit and Loss, the Restated Cash Flow Statement for the year ended March 31, 2025, March 31, 2024 and March 31, 2023, the Summary Statement of Significant Accounting Policies, the Notes and Annexures as forming part of these Restated Financial Statements (collectively, the “Restated Financial Information”), as approved by the Board of Directors of the company.

These Restated financial statements are prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accrual basis. GAAP comprises mandatory accounting standards as prescribed under Section 133 of the Companies Act, 2013 (the Act) read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act. The accounting policies adopted in the preparation of financial statements have been consistently applied. All assets and liabilities have been classified as current or non-current as per the companys normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of operations and time difference between the provision of services and realization of cash and cash equivalents, the company has ascertained its operating cycle as 12 months for the purpose of the current and non-current classification of assets and liabilities.

The Financial Statements have been prepared on a going concern basis, in as much as the management neither intends to liquidate the company nor to cease operations. Accordingly, assets, liabilities, income and expenses are recorded on a Going Concern basis. Based on the nature of products and services, and the time between the acquisition of assets and realization in cash or cash equivalents, the company has ascertained its operating cycle as 12 months for the purposes of current and non-current classification of assets and liabilities.

Use of Estimates

The preparation of financial statements is in conformity with Indian GAAP requires judgments, estimates and assumptions to be made that affect the reported amount of assets and liabilities, disclosure of contingent liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

Accounting Convention

The Company follows the mercantile system of accounting, recognizing income and expenditure on an accrual basis. The accounts are prepared on historical cost basis and as a going concern. Accounting policies not referred to specifically otherwise, are consistent with the generally accepted accounting principles.

The following significant accounting policies are adopted in the preparation and presentation of these restated financial statements:

1. Revenue Recognition

Revenue is stated net of rebates and trade discounts and exclude applicable taxes such as goods & service tax. Revenue from the sale of products is recognized when substantially all risks and rewards of ownership are transferred to the buyers, which generally occurs upon dispatch, provided the price is determinable. Export benefits (Pass Book Credit) are accounted for and recognized upon utilization by the Company.

Dividend income on financial instruments is recognized on a receipt basis. Interest on deposits is recognized on an accrual b asis.

2. Property, Plant and Equipment and Intangible Assets

i. Property, Plant & Equipment

a) Property, Plant and Equipment are stated as per Cost Model i.e., at cost less accumulated depreciation and impairment, if any; Costs directly attributable to acquisition are capitalized until the Property, Plant and Equipment are ready for use, as intended by the management;

b) Subsequent expenditures relating to Property, Plant and Equipment are capitalized only when it is probable that future economic benefits associated with these will flow to the Company and the cost of the item can be measured reliably. Repairs & maintenance costs are recognized in the Statement of profit & Loss when incurred;

c) The cost and related accumulated depreciated are eliminated from the Financial Statements upon sale or retirement of the asset and the resultant gains or losses are recognized in the Statement of Profit or Loss. Assets to be disposed of are reported at the lower of the carrying value or the fair value less cost to sell;

d) Depreciation on fixed assets will be calculated using the Written Down Value (WDV) method, which involves applying depreciation rates prescribed under Schedule II to the Companies Act 2013. to the carrying amount of the asset. The carrying amount is reduced each year by the amount of depreciation charged.

e) Depreciation: The Company depreciates tangible assets over the estimated useful life on Written Down Value Method from the date the assets are ready for intended use. The estimated useful lives of assets for the current and comparative period are as per years specified in Scheduled-II of Companies Act, 2013. Residual value considered as Nil for calculation of Depreciation.

f) Depreciation on tangible fixed assets is provided on the Written Down Value (WDV) method, in accordance with the useful lives prescribed in Schedule II to the Companies Act, 2013, except for the following asset categories, where the Company has adopted higher depreciation rates based on managements assessment of the assets usage pattern, expected useful life, and internal technical evaluation.

In such cases, the estimated useful lives of the assets differ from those prescribed under Schedule II of the Companies Act, 2013. These differences are disclosed as required under the Act.

The key variations are summarized below:

Asset Category	Depreciation Rate Applied	Schedule II Rate (WDV)	Reason for Variation
Computers & Accessories	63.16% (3 Years life)	40% (3 years life)	Frequent upgrades, obsolescence due to rapid technological changes
Office Equipment	25.89% (10 Years life)	19% (5 years life)	Higher wear & tear and reduced useful life due to intensive operational use
Office Equipment	31.23% (8 Years life)	19% (5 years life)	Higher wear & tear and reduced useful life due to intensive operational use
Plant & Machinery	31.23% (10 Years life)	13.91% (15 years life)	Used in high-load environments, requiring faster write-off
Furniture & Fixtures	25.89% (10 Years life)	9.5% (10 years life)	Modular and custom fittings replaced more frequently
Furniture & Fixtures	31.23% (8 Years life)	9.5% (10 years life)	Modular and custom fittings replaced more frequently
Electrical Installation/ Inverters	31.23%	15.83% (10 years life)	Faster deterioration due to load, power fluctuation, and climate impact

ii. Intangible Assets

Intangible assets are stated at cost less accumulated amortization and net of impairments, if any. An intangible asset is recognized if it is probable that the expected future economic benefits that are attributable to the asset will flow to the Company and its cost can be measured reliably. Intangible assets having finite useful lives are amortized on a straight-line basis over their estimated useful lives.

3. Impairment

The Management periodically assesses, using external and internal sources, whether there is an indication that an asset may b e impaired. An impairment loss is recognized wherever the carrying value of an asset exceeds its recoverable amount. The recoverable amount is higher than the assets net selling price and value in use, which means the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. An impairment loss for an asset is reversed if, and only if, the reversal can be related objectively to an event occurring after the impairment loss was recognized. The carrying amount of an asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.

4. Raw Material, Work-in-Progress and Finished Goods

Raw Materials -Lower of cost and net realizable value. However, materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Cost is determined on First in First out (FIFO) basis.

Finished goods and Work in progress are valued at the lower of cost and net realizable value. Cost is determined on First in First out (FIFO) basis.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and the estimated costs necessary to make the sale.

Work in Progress at various level is valued at lower of cost or net realizable value. The Management estimates the work in progress according to stage of completion. Cost of inventories comprises of cost of purchase, cost of conversion and other costs including manufacturing overheads incurred in bringing them to their respective present location and condition.

5. Foreign Exchange Transactions

The Company is exposed to foreign currency transactions including foreign currency revenues, and receivables. Foreign exchange transactions are recorded using the exchange rates prevailing on the dates of the respective transactions. Exchange differences arising from foreign exchange transactions settled during the period are recognized in the statement of profit and loss for the period.

Monetary items in the form of Loans, Current Assets and Current Liabilities in foreign currencies outstanding at the close of the year are converted in Indian currency at the closing exchange rate on the date of Balance Sheet. Resultant gain or loss on account of the fluctuation in the rate of exchange is recognized in the statement of Profit and Loss.

6. Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the effects of transactions of a non- cash nature, any deferrals or accruals of past or future operating cash receipts or payments and items of income or expenses associated with investing or financing cash flows. The cash flows from operating, investing and financing activities are segregated.

7. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of a qualifying asset are capitalized as part of the cost of that asset till such time the asset is ready for its intended use. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use. Costs incurred in raising funds are amortized equally over the period for which the funds are acquired. All other borrowing costs are charged to profit and loss account.

8. Income Tax

The accounting treatment for the Income Tax in respect of the Companys income is based on the Accounting Standard on ‘Accounting for Taxes on Income (AS-22). The provision made for Income Tax in Accounts comprises both the current tax and deferred tax. Provision for Current Tax is made on the assessable Income Tax rate applicable to the relevant assessment year after considering various deductions available under the Income Tax Act, 1961.

Deferred tax is recognized for all timing differences; being the differences between the taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods. Such deferred tax is quantified using the tax rates and laws enacted or substantively enacted as on the Balance Sheet date. The carrying amount of deferred tax asset/liability is reviewed at each Balance Sheet date and consequential adjustments are carried out

9. Earnings Per Share

Basic earnings per share are computed by dividing the net profit after tax by the weighted average number of equity shares outstanding during the period. Diluted earnings per share are computed by dividing the profit after tax by the weighted average number of equity shares considered for deriving basic earnings per share and also the weighted average number of equity shares that could have been issued upon conversion of all dilutive potential equity shares.

The diluted potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value which is the average market value of the outstanding shares. Dilutive potential equity shares are deemed converted as of the beginning of

the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

Particulars	Year ended March 31, 2025	Year ended March 31, 2024	Year ended March 31, 2023
a) Profit/ (loss) after tax (In Lakhs)	504.82	229.04	37.46
c) Profit Attributable to Equity Shareholders	504.82	229.04	37.46
d) Weighted Average Number of Ordinary Shares (In Nos.) after considering bonus	74,80,000	74,80,000	37,80,986
e) Nominal Value of Ordinary Shares	10	10	10
f) Earning Per Ordinary Share
Basic	6.75	3.06	0.99
Diluted	6.75	3.06	0.99

10. Provisions and Contingent Liabilities

Provisions and Contingent Liabilities Provisions are recognized only when there is a present obligation as a result of past events and when a reliable estimate of the amount of obligation can be made.

Contingent Liability is disclosed for:-

a) Possible obligation which will be confirmed only by future events not wholly within the control of the Company or

b) Present obligations arising from the past events where it is not probable that an outflow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation cannot be made.

c) Contingent Assets are not recognized in the financial statements since this may result in the recognition of income that may never be realized.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made.

11. Cash and Cash Equivalents

Cash and cash equivalents comprise cash and cash on deposit with banks. The Company considers all highly liquid investments with a remaining maturity at the date of purchase of three months or less and that are readily convertible to known amounts of cash to be cash equivalent.

12. Investments

Investment which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as non-current investments. On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

13. Government Grants and Subsidies

Government Grants and Subsidies Government grants and subsidies are recognised when there is reasonable assurance that the Company will comply with the conditions attached to them and the grants / subsidy will be received. Government grants whose primary condition is that the Company should purchase, construct or otherwise acquire capital assets are presented by deducting them from the carrying value of the assets. The grant is recognized as income over the life of a depreciable asset by way of a reduced depreciation charge. When the grant or subsidy relates to an expense item, it is recognized as income over the periods necessary to match them on a systematic basis to the costs, which it is intended to compensate.

14. Contingencies and events occurring after the Balance Sheet date

Events that occur between balance sheet date and date on which these are approved, might suggest the requirement for an adjustment(s) to the assets and the liabilities as at balance sheet date or might need disclosure. Adjustments are required to assets and liabilities for events which occur after balance sheet date which offer added information substantially affecting the determination of the amounts which relates to the conditions that existed at balance sheet date.

15. Related Party Transactions

Related parties as defined under Accounting Standard - 18 ‘Related Party Disclosures have been identified based on representations made by management and information available with the Company. All transactions with related parties are in the ordinary course of business and on arms length basis.

16. Segment Reporting

The Company operates in a single segment i.e. textiles, thus segment reporting is not applicable.

III.CHANGES IN ACCOUNTING POLICIES IN THE YEARS COVERED IN THE RESTATED FINANCIALS

There were no changes in the accounting policies which required adjustments in the Restated Financial Statements, except for the following:

a) The Company had not complied with the provisions of Accounting Standard - 15 “Employee Benefits” in respect of provisioning for gratuity in its historical financial statements up to the year ended 31st March 2023. Accordingly, no provision for gratuity liability was recognized in the books of account for those periods. In the Restated Financial Statements, the Company has applied the principles of Accounting Standard - 15, and appropriate provision for gratuity has been made in accordance with the standard.

Key Components of Income and Expenses

We report our income and expenditure in the following manner:

Total Income

Our total income comprises of revenue from operations and other income.

Revenue from operations: consists of revenue sale of manufactured products which includes sale of casual and ethnic wear and sale of fabric and sale of trading products which includes sale of casual and ethnic wear, fabric and others.

Other Income: primarily comprises of commission Income, discount received, Interest Income on Fixed Deposits Claim on Purchase & Rate Difference Foreign Exchange Gain/(Loss), cashback income received and Income Tax Refund,

Total Expenses

Total expenses consist of operating cost like cost of material consumed, Purchase of Stock in Trade, Change in inventories, Employee benefit expenses, Finance costs, Depreciation and Amortization Expenses and other expenses.

Cost of raw materials consumed:

Cost of Material consumed expenses primarily comprise of purchase of raw material as adjusted with opening and closing stock of raw material.

Purchase of Stock in Trade:

Purchase of Stock in Trade comprise of purchase of trading goods.

Change in inventories:

Changes in inventories of Work in Progress, Finished/trading goods between opening and closing dates of a reporting period.

Employee benefits expense:

Employee benefits expense primarily comprises of Salaries, Director remuneration, Staff welfare expenses, Contribution to PF and other fund, Contribution to Gratuity fund.

Finance Cost:

Our finance cost includes Interest on Term Loan, Interest on CC loan and other borrowing cost.

Depreciation and Amortization Expenses:

Depreciation includes depreciation on Plant & Machinery, Office Equipment, Furniture & Fixtures, Computer and printer and Motor Vehicle.

Other Expenses:

Other expenses primarily comprise manufacturing Expenses such as Job work charges, dyeing and printing, power and fuel, factory rent, custom charges, Commission on purchase, Freight & Transportation Exp., Wages and Other expenses comprise of advertisement and business promotion expenses, audit Fees, E-commerce commission and charges, Packing expenses, Interest & Penalty, Donation, Transportation and Courier Expenses, Professional fees, office rent expense, repairs and maintenance, Travelling expenses, and Other Miscellaneous expense.

Our Results of Operations

The following table sets forth select financial data derived from our restated statement of profit and loss for Fiscals 2025, 2024 and 2023 and we have expressed the components of select financial data as a percentage of total income for such years:

(Rs. in Lakhs except percentage)

	Particulars	For the year ended March 31,
		2025	% to the total Income	2024	% to the total Income	2023	% to the total Income
A	Revenue:
	Revenue From Operations	3068.95	98.15%	2331.84	98.82%	2800.78	99.95%
	Other Income	57.80	1.85%	27.94	1.18%	1.32	0.05%
	Total Income	3126.75	100%	2359.78	100%	2802.11	100%
	Expenses:
B	Cost of Material Consumed	555.59	17.77%	434.74	18.42%	286.78	10.23%
	Purchase of stock in trade	752.20	24.06%	428.65	18.16%	1081.41	38.59%
	Changes in inventories of finished goods and work in progress	(266.47)	(8.52%)	(202.66)	(8.59%)	69.88	2.49%
	Employee benefit expenses	148.71	4.76%	83.24	3.53%	99.33	3.54%
	Finance Costs	104.69	3.35%	79.10	3.35%	50.47	1.80%
	Depreciation and amortization expenses	22.25	0.71%	21.16	0.90%	3.06	0.11%
	Others Expenses	1130.64	36.16%	1209.08	51.24%	1160.65	41.42%
	Total Expenses	2447.60	78.28%	2053.30	87.01%	2751.48	98.19%
C	Profit before exceptional, extraordinary items and tax	679.15	21.72%	306.48	12.99%	50.63	1.81%
	Less: Exceptional Items	-	-	-
	Profit before extraordinary items and tax (A-B)	679.15	21.72%	306.48	12.99%	50.63	1.81%
	Prior Period Items	-		-		-
	Extra ordinary items	-		-		-
D	Profit before tax	679.15	21.72%	306.48	12.99%	50.63	1.81%
	Tax expense:
	Current tax	179.55	5.74%	79.21	3.36%	14.16	0.51%
	Tax Related to Earlier year	-	-	-
	Deferred Tax Expense/(income)	(5.23)	(0.17%)	(1.77)	(0.08%)	(0.99)	(0.04%)
	Profit/(Loss) for the period After Tax- PAT	504.82	16.15%	229.04	9.71%	37.46	1.34%

FINANCIAL PERFORMANCE HIGHLIGHTS FOR THE FINANCIAL YEAR 2024-25:

Total Income:

Total income for the year ended March 31, 2025 stood at Rs.3,126.75 Lakhs. The total income consists of revenue from operations and other income.

Revenue from Operations:

During the year ended March 31, 2025, the net revenue from operations of our Company was ?3,068.95 lakhs, primarily from the sale of manufactured and trading goods. Revenue from manufactured goods comprised sales of casual and ethnic wear amounting to ?1,968.94 lakhs and fabric amounting to ?39.97 lakhs, while revenue from trading goods comprised sales of casual and ethnic wear amounting to ?342.91 lakhs and fabric amounting to ?717.14 lakhs..

Other Income:

During the year ended March 31, 2025 the other income of our Company stood at Rs.57.80 Lakhs. Other income primarily comprise s Commission income, Interest on Fixed Deposits, Discount received Claim on Purchase & Rate Difference and Cash back income.

Total Expenses:

Total expenses consist of operating cost like cost of material consumed, Purchase of Stock in Trade, Changes in Inventories, Employee benefits expenses, Finance cost, Depreciation and Amortization Expenses and other expenses. During the year ended March 31, 2025 the total expenses of our Company stood at Rs 2,447.60 Lakhs.

Cost Of Material Consumed:

During the year ended March 31, 2025 the Cost of Material Consumed of our Company stood at Rs.555.59 Lakhs.

Purchase of stock in trade:

During the year ended March 31, 2025 the purchase of stock in trade of our Company stood at Rs.752.20 Lakhs.

Change in inventories:

During the year ended March 31, 2025 the Change in inventories of Work in progress and Finished/Trading Goods of our Company stood at Rs. (266.47) Lakhs.

Employee benefits expenses:

During the year ended March 31, 2025 the employee benefit expenses of our Company stood at Rs.148.71 Lakhs. The main components of the employee benefit expenses are Salary, Director Remuneration, Contribution to Gratuity Expense, Staff Welfare Expenses. Contribution to PF, and Other fund

Finance Costs:

During the year ended March 31, 2025 the finance cost of our Company stood at Rs. 104.69 Lakhs. Our finance cost includes Interest on CC loan, Term Loan, and other borrowing cost.

Depreciation and Amortization Expenses:

During the year ended March 31, 2025 the Depreciation expenses of our Company stood at Rs. 22.25 Lakhs.

Other Expenses:

Other expenses for the year ended March 31, 2025, were Rs. 1130.64 Lakhs, including manufacturing expenses, administrative costs, repairs and maintenance, selling and distribution expenses, and other operational outflows.

Restated Profit before tax:

The Company reported Restated profit before tax for year ended March 31, 2025 of Rs. 679.15 Lakhs.

Restated profit after tax:

The Company reported Restated profit after tax for year ended March 31, 2025 of Rs. 504.82 Lakhs.

FINANCIAL YEAR ENDED 31st MARCH 2025 COMPARED TO FINANCIAL YEAR ENDED 31st MARCH 2024 Total Income

The total income for FY 2024-25 stood at Rs.3126.75 Lakhs, compared to Rs.2359.78 Lakhs in FY 2023 -24, reflecting a growth of 32.50%. This increase was primarily driven by higher revenue from operations.

Revenue from Operations

In FY 2024-25, revenue from operations stood at ? 3,068.95 lakhs, an increase of 31.61% over ?2,331.84 lakhs in FY 2023-24. The growth was primarily driven by revenue from manufactured products amounted to ?2,008.91,lakhs, representing 65.46% of total revenue in FY 2024-25, against ?1670.52 lakhs representing 71.64% in FY 2023-24. The revenue from trading goods contributed ?1,060.04 lakhs representing 34.54% of total revenue in FY 2024-25, as compared to ?661.33 lakhs representing 28.36% in FY 2023-24. The Product-wise comparison is presented below:

The sale of Manufactured goods includes Casual and ethnic wear amounted to ?1,968.94 lakhs in FY 2024 -25 and in FY 2023-24 is ?1,658.58 lakhs and fabric amounted to ? 39.97 lakhs in FY 2024-25 and ^11.94 lakhs in FY 2023-24, whereas sale of trading goods includes Casual and ethnic wear amounted to ?342.91 lakhs in FY 2024-25 and ?462.72 lakhs in FY 2023-24 and fabric includes ?717.14 lakhs in FY 2024-25 and ?124.58 in FY 2023-24.

Other Income:

Other income for FY 2024-25 stood at Rs. 57.80 Lakhs, compared to Rs.27.94 Lakhs in FY 2023 -24, marking a growth of 106.90%. This growth was attributable to commission income received of Rs.50.05 lakhs in FY 2024-25 which is Rs.21.98 lakhs in FY 202324.

Total Expenses:

Total expenses for FY 2024-25 were Rs. 2,447.60 Lakhs, compared to Rs.2,053.30 Lakhs in FY 2023-24, reflecting a rise of 19.20%. This increase was due to increase in business operations of the Company resulting into higher material costs job work Charges, employee benefits, depreciation and other operational expenses.

Cost of Material Consumed and purchase of stock-in-trade:

The cost of materials consumed increased to ?555.59 lakhs in FY 2024-25 from ?434.74 lakhs in FY 2023-24, representing a rise of 27.80%. This increase is attributable to the commencement of new manufacturing unit in FY 2023-24 and also in FY 2024-25 another manufacturing unit in Jaipur commenced, resulting in higher material consumption, whereas purchase of stock in trade increased in FY2024-25 to ?752.20 lakhs from ?428.65 lakhs in FY 2023-24 in order to meet increased demand of products in market. Additionally, the items wise detailed breakup prescribed below:

Details of Principal Items of Raw Materials and Trading goods Purchased:

(in Lakhs)

Particulars	For the Year ended on
	2025	2024	2023
Trading Purchase
Ethnic and Casual Wear	197.05	268.11	1,081.41
Fabric	555.14	117.84	-
Others	-	42.70	-
Total (a)	752.20	428.65	1,081.41
Manufacturing Purchase*
Fabric	727.93	423.16	592.28
Total (b)	727.93	423.16	592.28
Total	1,480.13	851.82	1,673.69

*Manufacturing purchase includes manufacturing through job work as well as own production.

Change in inventories:

Our Company has incurred Rs. (266.47) Lakhs as Change in inventories of Work in progress and Finished/Trading goods during the financial year 2024-25 as compared to Rs. (202.66) Lakhs in the financial year 2023-24.

Employee benefits expense:

Our Company incurred ^148.71 Lakhs as Employee Benefits Expense during the financial year 2024-25, as compared to ?83.24 Lakhs in 2023-24 .The increase in FY 2024-25 was primarily attributable to, Salary increased from ?70.76 Lakhs in FY 2023-24 to ?91.22 Lakhs in FY 2024-25.Directors Remuneration rose from ? 12 Lakhs in FY 2023-24 to ? 48 Lakhs in FY 2024- 25,Contribution to Provident Fund and Other Funds grew to ?1.41 Lakhs in FY 2024-25 which was Nil in FY 2023-24, Contribution to Gratuity Fund increased from ?(1.19) Lakhs to ?5.03 Lakhs and Staff Welfare Expenses increase from ?1.67 Lakhs to ?3.05 Lakhs.

Finance Cost:

Our Company incurred a total of ?104.69 Lakhs as Finance Costs during the financial year 2024-25, compared to ?79.10 Lakhs in 2023-24 showing 32.34% increase over the previous year. The rise in finance cost during FY 2024-25 was primarily due to Interest on Working Capital Loans grew from ?39.72 Lakhs to ?44.78 Lakhs, Interest While Interest on Term Loans marginally increased from ?20.07 Lakhs in FY 2024 to ?23.35 Lakhs in FY 2025 and other borrowing cost increased from ?19.31 lakhs in FY 2023 -24 to ?36.55 lakhs in FY 2024-25.

Depreciation and Amortization Expenses:

Depreciation for the financial year 2024-25 stood at Rs. 22.25 Lakhs as against Rs. 21.16 Lakhs during the financial year 2023 -24. The increase in depreciation was around 5.15% which was due to purchase Plant & machinery, furniture, vehicle, computer and printer and other office equipment.

Other Expenses:

Other expenses stood at ?1130.64 lakhs in FY 2024-25 as against ?1209.08 lakhs in FY 2023-24, reflecting a decline of 6.49% year-on-year. The decrease was mainly due to lower job work charges amounted to ?367.70 lakhs in FY 2023-24 to ?227.00 lakhs

in FY 2024-25, commission on purchase for ?20.05 lakhs to ?4.18 lakhs, customs duty amounted to ?17.00 lakhs to Nil, freight and transport (inward) from ?10.07 lakhs in FY 2023-24 to ?5.24 lakhs in FY 2024-25, business promotion from ?11.10 lakhs in FY 2023-24 to ?4.03 lakhs in FY 2024-25, and e-commerce commission from ?235.80 lakhs to ?165.62 lakhs. The reduction in e - commerce commission is primarily due to changes in the commission structure by certain e-commerce platforms during the period, resulting in a lower percentage of commission payable on sales transactions and a shift in sales towards lower-commission portals. At the same time, certain expenses increased during the year, including dyeing and printing charges from ?55.53 lakhs in FY 2 02324 to ?73.61 lakhs in FY 2024-25, wages from Nil to ?81.24 lakhs in FY 2024-25, and e-commerce charges from ?353.86 lakhs in FY 2023-24 to ?389.81 lakhs in FY 2024-25. Unlike commission, E-commerce charges mainly comprise delivery, pick-and-pack, and other fulfilment-related costs levied by e-commerce platforms, which are not reversed in case of product returns. Increases were also observed in advertisement and publicity, professional fees, packing expenses, interest and penalty, and travelling expenses.

Restated profit before tax:

Net profit before tax for the financial year 2024-25 increased to Rs. 679.15 Lakhs as compared to Rs.306.48 Lakhs in the financial year 2023-24. This significant growth was primarily driven by the factors mentioned above.

Restated profit for the year:

As a result of the foregoing factors, our profit after tax increased from Rs.229.04 Lakhs in the financial year 2023 -24 to Rs. 504.82 Lakhs in the financial year 2024-25.

FINANCIAL YEAR ENDED 31st MARCH 2024 COMPARED TO FINANCIAL YEAR ENDED 31st MARCH 2023 Total Income:

The total income for FY 2023-24 stood at Rs.2,359.78 Lakhs, compared to Rs. 2,802.11 Lakhs in FY 2022-23, reflecting a decline of (15.79) %. This decrease was primarily driven by decline in revenue from operations.

Revenue from Operations:

In FY 2023-24, the revenue from operations was ?2,331.84 Lakhs, showing a decrease from ?2,800.78 Lakhs in FY 2022-23, which represents 16.74%. The decline was primarily driven by decline in Revenue from trading products amounted to ?661.33 lakhs, representing 28.36% of total revenue in FY 2023-24, against ?2,137.66 lakhs representing 76.32% in FY 2022- 23. The Revenue from manufacturing products contributed ?1,670.52 lakhs representing 71.64% of total revenue in FY 2023 -24, as compared to ?663.13 lakhs representing 23.68% in FY 2022-23. The Product-wise comparison is presented below:

The sale of Manufactured goods includes Casual and ethnic wear amounted to ?1,658.58 lakhs in FY 2023 -24 and in FY 2022-23 is ?663.13 lakhs and fabric amounted to ? 11.94 lakhs in FY 2023-24 which are Nil in FY 2022-23, whereas sale of trading goods includes Casual and ethnic wear amounted to ?462.72 lakhs in FY 2023-24 and ?2,073.76 lakhs in FY 2022-23 and fabric includes ?124.58 lakhs in FY 2023-24 and ? 63.90 lakhs in FY 2022-23 and other products sale is ?74.03 lakhs in 2023-24 (Nil in 2022-23).

Other Income:

Other income for FY 2023-24 stood at ?27.94 Lakhs, compared to ?1.32 Lakhs in FY 2022-23.This growth was primarily driven by Commission income amounting to ?21.98 Lakhs in FY 2023-24 (Nil in FY 2022-23), Interest on Income Tax Refund of ?0.82 Lakhs in FY 2023-24 as against ?0.01 Lakhs in FY 2022-23, Foreign Exchange gain of Rs.3.10 lakhs in FY 2023-24 from nil value in FY 2022-23.

Total Expenses:

Total expenses for FY 2023-24 were Rs. 2,053.30 Lakhs, compared to Rs. 2,751.48 Lakhs in FY 2022-23, reflecting a decline of 25.37%. This decrease was due to various factors which are described below.

Cost of raw Material consumed and purchase of stock in trade:

The cost of raw material consumed increased to ?434.74 Lakhs in FY 2023-24 from ?286.68 Lakhs in FY 2022-23, whereas purchase of stock in trade decreased to ?428.65 lakhs in FY 2023-24 from ?1,081.41 lakhs in FY 2022-23. These changes are attributable to the commencement of in-house manufacturing operations in FY 2023- 24, resulting higher utilization of resources and decrease the purchase of stock from outside the market. Additionally, the items wise detailed breakup prescribed below:

Details of Raw Material and Trading goods purchased:

The total value of principal raw materials and trading goods purchased stood at ?851.82 lakhs in FY 2023 -24, compared to ?1,673.69 lakhs in FY 2022-23, reflecting a decrease of 49.11%. This change was due to raw material purchases of fabric reducing from ?592.28 lakhs in FY 2022-23 to ?423.16 lakhs in FY 2023-24, and a decline in trading purchases of ethnic and casual wear from ?1,081.41 lakhs to ?268.11 lakhs during the same period. At the same time, purchases of fabric for trading purposes increased to ?117.84 lakhs and ?42.70 lakhs, respectively, in FY 2023-24 (Nil in FY 2022-23).

Change in inventories:

Our Company has incurred Rs. (202.66) Lakhs as Change in inventories of Work in progress, finished/Trading goods during the financial year 2023-24 as compared to Rs. 69.88 Lakhs in the financial year 2022-23.

Employee benefits expense:

Our Company incurred ?83.24 Lakhs as employee benefit expenses during the financial year 2023-24, compared to ?99.33 Lakhs in 2022-23, reflecting an decrease of 16.20%. This decrease was primarily attributable to decline in Salary from ^73.18 Lakhs in FY 2022-23 to ?70.76 Lakhs in FY 2023-24, Directors Remuneration increasing from ?21.40 Lakhs to ?12 Lakhs, decreased in staff welfare Expenses from ?1.69 Lakhs to ?1.67 Lakhs.

Finance Cost:

Our Company incurred a total of ?79.10 Lakhs as Finance Costs during the financial year 2023-24, compared to ?50.47 Lakhs in 2022-23, registering a significant increase of 56.74%. This increase was primarily driven by a rise in Interest on CC loans from ?16.56 Lakhs to ?39.72 Lakhs, reflecting higher utilization of short-term credit facilities. Additionally, interest on term loans increased from ?16.77 Lakhs to ?20.07 Lakhs and other borrowing cost increased from ?17.14 Lakhs in FY 2022-23 to ?19.31 Lakhs in FY 2023-24.

Depreciation and Amortization Expenses:

Depreciation for the financial year 2023-24 stood at ?21.16 Lakhs, as against ?3.06 Lakhs during the financial year 2022- 23. The rise in depreciation expense was primarily due to the addition of plant and machinery, vehicles, computers, printers, furniture, and other office equipment during the year in line with the Companys continued investments in expanding its operational infrastructure.

Other Expenses:

Our Company incurred ?1,209.08 Lakhs in other expenses during FY 2023-24, compared to ?1,160.65 Lakhs in FY 2022-23, registering a growth of 4.17%. However, this increase was mainly attributable to higher expenses on E-commerce Charges from Rs.234.82 lakhs to Rs.353.86 lakhs, Dyeing & Printing charges from Rs.38.61 lakhs to Rs.55.53 lakhs and custom duty of Rs.17 lakhs during FY 2023-24. The increase was partly offset by a reduction in Job Work Charges, Freight and forwarding charges, advertisement and publicity expenses, E-commerce Commission charges reflecting improved in-house capabilities and improving cost management.

Restated Profit Before Tax

Net profit before tax for the financial year 2023-24 increased to ?306.48 Lakhs from ?50.63 Lakhs in FY 2022-23. This significant growth was primarily driven by the factors mentioned above.

Restated profit after Tax

As a result of the foregoing factors, our profit after tax increased from Rs.37.46 Lakhs in the financial year 2022-23 to Rs.229.04 Lakhs in the financial year 2023-24.

Cash Flows and Cash and Cash Equivalents

(Rs. in Lakhs)

Particulars	Fiscals
	2025	2024	2023
Net cash (used)/generated from operating activities	(62.06)	82.45	(369.83)
Net cash (used)/generated from investing activities	(23.98)	(76.99)	(3.75)
Net cash (used)/ generated from financing activities	78.79	2.90	366.46
Net increase / (decrease) in cash and cash equivalents at the end of the year	(7.25)	8.36	(7.12)
Cash and Cash equivalents at the beginning of the year	12.28	3.92	11.04
Cash and Cash equivalents at the end of the year	5.03	12.28	3.92

Operating Activities FY 2024-25

Net cash generated from operating activities was ? (62.06) lakhs for the FY 2024-25. While our net profit before tax was ?679.15 lakhs, we had an operating profit before working capital changes of ?815.95 lakhs for the FY 2024 -25 which was primarily due to depreciation of ?22.25 lakhs, finance cost of ? 104.69 lakhs, Provision for Gratuity of ?5.03 lakhs and sundry balance writte n off for Rs.4.84 lakhs. Our changes in working capital for the FY 2024-25 primarily consisted of an increase in trade receivables by ?577.73 lakhs, increase in inventories by 438.81 lakhs, increase in other current assets by ?13.87 lakhs, increase in trade p ayables by ?157.45 lakhs, increase in other current liabilities by ?11.78 lakhs and decrease in short term loans & advances by ?54.51 lakhs. Our income taxes paid was ?71.34 lakhs for the financial year 2024-25.

FY 2023-24

Net cash generated from operating activities was ?82.45 lakhs for the FY 2023-24. While our net profit before tax was ? 306.48 lakhs, we had an operating profit before working capital changes of ?404.73 lakhs for the FY 2023 -24 which was primarily due to depreciation of ^21.16 lakhs, interest expenses of ?79.10 lakhs, Provision for Gratuity (?1.19) lakhs. Our changes in working capital for the FY 2023-24 primarily consisted of an increase in trade receivables by ?70.52 lakhs, increase in inventories by 191.09, increase in other current assets by ?3.28 lakhs, increase in trade payables by ?22.17 lakhs, increase in other current liabil ities by ?6.29 lakhs and increase in short term loans & advances by ?71.22 lakhs. Our income taxes paid was ?14.62 lakhs for the financial year 2023-24.

FY 2022-23

Net cash generated from operating activities was (?369.83) lakhs for the FY 2022-23. While our net profit before tax was ? 50.63 lakhs, we had an operating profit before working capital changes of ^119.21 lakhs for the FY 2022 -23 which was primarily due to depreciation of ?3.06 lakhs, interest expenses of ?50.47 lakhs, Provision for Gratuity of ?15.06 lakhs. Our changes in workin g capital for the FY 2022-23 primarily consisted of an increase in trade receivables by ?38.02 lakhs, increase in inventories by ?235.72 lakhs, increase in other current assets by ?259.34 lakhs, decrease in trade payables by ?147.24 lakhs, increase in other curr ent liabilities by ?5.96 lakhs and decrease in short term loans & advances by ?211.63 lakhs and decrease in short term provi sions by ?12.69 lakhs, and income taxes paid was ?13.61 lakhs for the financial year 2022 -23.

Investing Activities

FY 2024-25

Net cash outflow in investing activities was ?(23.98) lakhs for the FY 2024-25, primarily comprising payment for purchase of Fixed Assets of (?21.74) lakhs and decrease in other non -current assets for (?2.25) lakhs.

FY 2023-24

Net cash outflow in investing activities was ?(76.99) lakhs for the FY 2023-24, primarily comprising payment for purchase of Fixed Assets of (?76.89) lakhs and decrease in other non-current assets for (Rs. 0.92) lakhs.

FY 2022-23

Net cash outflow in investing activities was (?3.75) lakhs for the FY 2022-23, primarily comprising payment for purchase of Fixed Assets of (?3.76) lakhs, decrease in long term loans and advances of (?0.05) lakhs and increase in other non current assets of Rs.0.05 lakhs.

Financing Activity FY 2024-25

Net cash flow generated from financing activities was ?78.79 lakhs for the FY 2024-25, primarily comprising of Proceeds from Long Term Borrowings of ?71.58 lakhs, increase in short term borrowings of ^111.90 lakhs adjusted by payment of interest of (?104.69) lakhs.

FY 2023-24

Net cash flow used in financing activities was ?2.90 lakhs for the FY 2023-24, primarily comprising of proceeds of long term borrowings for ?0.44 lakhs, increase in short term borrowings of ^81.55 lakhs adjusted by payment of interest of (?79.10) lakhs.

FY 2022-23

Net cash flow generated from financing activities was ?366.46 lakhs for the FY 2022-23, primarily comprising of proceeds from issue of share capital of ?88 lakhs, repayment of long term borrowings of (?15.31) lakhs and increase in short term borrowing s of ?344.24 lakhs adjusted by payment of interest of (?50.47) lakhs.

Details of change in the Revenue, EBITDA and PAT year on year are as below:

(in Lakhs)

Particulars	FY 2024-25	FY 2023-24	FY 2022-23
Revenue from Operation	3068.95	2331.84	2800.78
% rise in Revenue from operation year on year	31.61%	(16.74%)	7.48%
EBITDA	748.28	378.80	102.83
EBITA Margin	24.38%	16.24%	3.67%
% rise in EBITDA year on year	97.54%	268.37%	84.68%
PAT	504.82	229.04	37.46
PAT margin to revenue	16.45%	9.82%	1.34%

Rationale for increase/ decrease in Revenue, EBITDA and PAT from F.Y 2022-23 to F.Y 2023-24 to F.Y 2024- 25:

> The reasons for the increase/decrease in revenue have been discussed in detail in the section ‘Comparative Financial Performance for each of the respective years.

> EBITDA increase by 97.54% from ?378.80 lakhs in FY 2023-24 to ?748.28 lakhs in FY 2024-25, primarily on account of growth in revenue, driven mainly by higher, which contributed to margin improvement. Further, commencement of full-fledged manufacturing operations during FY 2024-25 also supported the increase in EBITDA.

> EBITDA rose by 268.37%, from ?102.83lakhs in FY 2022-23 to ?378.80 lakhs in FY 2023-24, in spite of decrease in revenue from operations, Company focused on optimizing its cost structure also supported by improvement of operational efficiency company commenced the manufacturing operations in FY 2023 -24, whereas in FY 2022-23 the Company s operations were largely dependent on trading activities and manufacturing on job work basis.

> PAT margin improved to 16.45% in FY 2024-25 as compared to 9.82% in FY 2023-24 and 1.34% in FY 2022-23. The increase in FY 2024-25 was primarily attributable to the commencement of new manufacturing operations and operating at full-fledged, hence marked a significant rise in revenue from the manufacturing business.

Year-on-Year Analysis of Cost of Material Consumed in relation to Revenue from Operations:

(Rs. in Lakhs)

Particulars	FY 2024-25	FY 2023-24	FY 2022-23
Cost of material consumed (a)	555.59	434.74	286.68
Purchase of stock in trade(b)	752.20	428.65	1081.41
Change in Inventories(c)	(266.47)	(202.66)	69.88
Total Cost of goods sold (a+b-c)	1041.32	660.73	1437.97
Revenue from Operations	3,068.95	2,331.84	2,800.78
Cost as a % of Revenue from Operations	33.93%	28.33%	51.34%

Rationale for changes in Cost of Material Consumed as a percentage of Revenue from Operations from FY 2022-23 to FY 2023-24 and FY 2024-25:

> In FY 2024-25, the cost of goods sold increased to ?1,041.32 lakhs in line with the growth in revenue from operations. The increase is in corresponds to the commencement of manufacturing operations in FY 2023 -24 at full-fledged results in higher production volumes, The cost of materials consumed decreased from ?1,437.97 lakhs in FY 2022-23 to ?660.73 lakhs in FY 202324, primarily due to a decline in revenue during the year and this was influenced by market volatility and fluctuations in Price of raw material.

Balance sheet Line Items

1. Long Term Borrowings:

As on March 31, 2025, the Companys net long-term borrowings (after current maturities) stood at ?158.12 lakhs, compared to ?86.54 lakhs in FY 2023-24, an increase of 82.71%. However, the total secured loans reduced to ?41.03 lakhs in FY 2024- 25 from ?47.57 lakhs in FY 2023 -24. The shift is attributable to repayment of Vehicle loan, commencement of loan from various banks for the business use resulting the increase in overall gross loan exposure of the Company.

Current maturities of long-term borrowings increased substantially to ?54.57 Lakhs in FY 2024-25 from ?53.63 Lakhs in FY 2023 - 24, indicating increase in loan proceeds.

As on March 31, 2024, net long-term borrowings (after current maturities) stood at ?86.54 lakhs as against ?86.10 lakhs in the FY 2022-23, showing a slight increase of 0.52%.Total Secured loan increased to ?47.57lakhs in FY 2023-24 (nil in FY 2022-23), whereas there is decrease in long term unsecured loans amounting to ?44.72 lakhs indicating repayment of various bank loans.

Current maturities of long-term borrowings increased to ?53.63 lakhs in FY 2023 -24 from ?44.72 lakhs in FY 2022-23.

2. Short Term Borrowings:

In FY 2024-25 the total short-term borrowings increased to ?726.24 Lakhs from ?614.34 Lakhs in FY 2023-24, reflecting a 18.21% increase. Secured loans from banks rose to ?506.02 Lakhs, increase from ?400.10 Lakhs in FY 2023 -24, whereas unsecured loans from banks and Financial institutions rose to ?155.58 lakhs in FY 2024-25 from ?54.75 lakhs in FY 2023-24 setoff by decrease in loan taken from related parties of ?101.58 in FY 2023-24 to ?8.81 lakhs in FY 2024-25. Current maturities of long-term borrowings increased substantially to ?54.57 Lakhs in FY 2024-25 from ?53.63 Lakhs in FY 2023-24.

In FY 2023-24 the total short-term borrowings increased to ?614.34 Lakhs from ?532.78 Lakhs in FY 2022-23, showing an increase of 15.31%. Bank borrowings (secured loans) rose to ?400.10 Lakhs from ?389.20 Lakhs. Unsecured loans from banks and Financial Institutions decreased from ?92.85 lakhs to ?54.75 lakhs, Loans from related parties increased to ?101.58 Lakhs from ?6.01 Lakhs to support the working capital requirements and ongoing business operations of the Company.

3. Trade Receivables

Our trade receivables increased from ?325.49 lakhs in FY 2022-23 to ?396.01 lakhs in FY 2023-24 and to ?968.90 lakhs in FY 2024-25. The increase is attributable to the higher share of B2B sales, where longer credit periods are extended to customers in line with industry practices. In the B2C segment, receivables arise due to the mix of e-commerce platforms, each with its own settlement cycle. The movement in receivables reflects both the share of B2B sales and the settlement practices in the B2C segment.

4. Trade Payables

Our Trade Payables (Dues other than micro and small enterprises) rose from ?335.84 lakhs in FY 2023 -24 to ?493.29 lakhs in FY 2024- 25, showing an increase of about 46.88% and in FY 2022-23 increased from ?313.67 lakhs to ?335.84 lakhs in FY 2023-24 showing rise by approximately 7.07%. The increase is primarily due to higher procurement of raw materials and trading goods in line with business requirements.

5. Inventories

Our inventories increased from ?561.27 lakhs in FY 2022-23 to ?752.36 lakhs in FY 2023-24, and further to ^1,191.17 lakhs in FY 2024-25. In FY 2022-23, manufacturing was carried out on a job work basis. From FY 2023-24, the Company commenced inhouse production, which led to higher inventory levels. To support online sales through multiple platforms, the Company maintained finished goods inventory along with raw materials and work-in-progress (WIP) foam, resulting in longer holding periods. These inventory levels support both B2B and B2C sales and ensure continuity of operations across manufacturing and distribution.

6. Short term Loans and Advances

Short-term loans and advances increased significantly from ?8.16 lakhs in FY 2022-23 to ?79.38 lakhs in FY 2023-24. This rise was primarily due to an increase in advances to vendors from Rs.7.81 lakhs in FY 2022-23 to Rs.76.04 lakhs in FY 2023- 24 and prepaid expenses increased from Rs.0.35 lakhs in FY 2022-23 to Rs.0.61 lakhs in FY 2023-24.

Similarly in FY 2024-25, short term loans and advances decreased to ?14.79 lakhs from Rs.79.38 lakhs in FY 2023 -24. This decline was primarily due to an decrease in advances to suppliers from Rs.76.04 lakhs in FY 2023 -24 to Rs.3.28 lakhs in FY 2024-25, set off by increase in advance to Employees from Rs.0.20 lakhs in FY 2023-24 to Rs.3.87 lakhs in FY 2024-25 and also increase in Prepaid expenses from ?0.61 lakhs in FY 2023-24 to ?7.63 lakhs in FY 2024-25.

Information required as per Item (II)(C)(iv) of Part A of Schedule VI to the SEBI Regulations:

An analysis of reasons for the changes in significant items of income and expenditure is given hereunder:

1. Unusual or infrequent events or transactions:

There has not been any unusual events or transactions on account of our business activity.

2. Significant economic changes that materially affected or are likely to affect income from continuing operations:

Other than as described in the section titled “Risk Factors” beginning on page 24 of this Draft Red Herring Prospectus, to our knowledge there are no known significant economic changes that have or had or are expected to have a material adverse impact on revenues or income of our Company from continuing operations.

3. Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations:

Apart from the risks as disclosed under Section “Risk Factors” beginning on page 24 of the Draft Red Herring Prospectus, in our opinion there are no other known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations.

4. Future changes in the relationship between costs and revenues:

Other than as described in the sections “Risk Factors”, “Our Business” and “Managements Discussion and Analysis of Financial Condition and Results of Operations” on page 24, 123 And 261 respectively, to our knowledge, no future relationship between expenditure and income is expected to have a material adverse impact on our operations and finances.

5. Segment Reporting:

The Company operates in a single segment i.e. textiles, thus segment reporting is not applicable.

6. Status of any publicly announced New Products or Business Segment:

There is no new products which is announced publicly.

7. Seasonality of business:

Our business is not subject to seasonality. For further information, see “Industry Overview” and “Our Business” on page 103 and 123 respectively.

8. Dependence on recurring purchase order, particulars from our top B2B customers:

Our business model is primarily based on the receipt of purchase orders from our customers and we do not enter into long-term agreements that provide assured revenues. For details, please refer to risk factor "We do not have long-term agreements with our customers and our revenues are significantly dependent on recurring purchase orders, particularly from our top B2B customers. ” on page 27 of this DRHP.

9. Competitive conditions:

Competitive conditions are as described under the Chapter “Our Business - Competition” beginning on page 141 of this Draft Red Herring Prospectus.

10. Details of material developments after the date of last balance sheet i.e., March 31, 2025:

After the date of last Balance sheet i.e., March 31, 2025, the following material events have occurred after the last audited period:

a) Increase in Authorized Capital from Rs. 25 Lakhs to Rs. 6.00 Crores in the Extra Ordinary general meeting held on May 26, 2025.

b) Further Increase in Authorized Capital from Rs. 6.00 Crores to Rs. 11.00 Crores in the Extra Ordinary general meeting held on June 30, 2025.

c) We have capitalized the profits of the company by issuing 72,60,000 equity shares of Face Value of Rs. 10/- in ratio of 33:1 (33 new equity share for 1 Existing share) approved in Annual General Meeting held on August 08, 2025 and allotted by the board in the meeting held on August 11, 2025.

d) We have passed a Board resolution in the meeting of Board of Director dated August 06, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

e) We have passed a special resolution in the meeting of shareholders dated August 08, 2025 authorizing the Board of Directors to raise funds by making an Initial Public Offering.

f) The Registered office of the company was shifted from from Shop No 30, first floor, Vardhaman Market, Near Old bus stand, Pali, Rajasthan- 306401 to G1-41, RIICO, Tonk Road, Sitapura Industrial Area, Jaipur - 302022, Rajasthan, India, vi Board resolution dated July 01, 2025.

CAPITALISATION STATEMENT

Particulars	Pre Issue as at 31.03.2025	As adjusted for the Proposed Issue*
Borrowings
Short term debt (A)	671.67	-
Long Term Debt (B)	212.69	-
Total debts (C)	884.36	-
Shareholders funds (Equity)
Equity share capital	22.00	*
Reserve and surplus	907.20	*
Total shareholders funds (Equity)	929.20	*
Long term debt / Shareholders funds	0.23	*
Total debt / Shareholders funds	0.95	*

* The corresponding post issue figures are not determinable at this stage pending the completion of public issue and hence have not been furnished.

Notes:

1. Short term Debts represent which are expected to be paid/payable within 12 months and Excludes instalments of term loans repayable in within 12 months.

2. Long term Debts represent debts other than Short term Debts as defined above but includes installment of term loans repayable within 12 months grouped under other current liabilities.

3. The figures disclosed above are based on restated statement of Assets and Liabilities of the Company as at 31.03.2025.