Shiva Mills Ltd Management Discussions

The Company is primarily engaged in the manufacturing and marketing of cotton yarn. It operates a spinning unit located near Dindigul, Tamil Nadu, with an installed capacity of 39,072 spindles. Additionally, the Company owns 22 windmills with a total installed capacity of 10.65 MW.

Overview of the Industry

The Indian Textile Industry plays a crucial role in Indias economic development, acting as a catalyst for exports, employment generation, womens empowerment, and the preservation of Indias cultural heritage. As one of the oldest industries in the country, it has evolved into a self-reliant, vertically integrated sector, spanning from the production of raw materials to the delivery of finished garments and home textiles.

The textile industry is the second-largest employment-generating sector in India, after agriculture. It contributes nearly 2% to the countrys GDP and 10% to industrial production.

OPPORTUNITIES

The Indian cotton yarn industry is poised for growth, with India maintaining a strong export position. Opportunities lie in expanding into traditional markets like the US, Europe, and Bangladesh, while also tapping into emerging economies with rising textile demand. Technological advancements in manufacturing and supply chains will improve efficiency and product quality. Additionally, growing global demand for sustainable textiles presents a chance for India to lead in organic cotton and eco-friendly practices.

SEGMENT-WISE OR PRODUCT - WISE PERFORMANCE

The Company operates under a single business segment, namely the Textile Business. The detailed performance of this segment has been provided under the section titled "Review of Operations” in the Directors Report.

OUTLOOK

The future of the Indian textile industry looks promising, supported by strong domestic consumption, rising global demand, and continued policy support. With its labour-rich base, global market presence, and deep cultural roots, the Indian textile sector is poised to become a global powerhouse, provided it continues to focus on innovation, sustainability, and inclusive growth.

RISKS AND CONCERNS

The textile industry faces several risks, including the unpredictable availability and price volatility of cotton, which is influenced by weather conditions and global market dynamics. The demand for cotton yarn can also fluctuate, affecting supply chain stability and pricing. Other concerns include the shortage of skilled labour, competition from low-cost countries with trade advantages, and foreign exchange fluctuations, all of which can impact the Companys operational and financial performance.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has adequate internal control procedures and systems commensurate with its size and nature of its business for purchase of raw materials, plant and machinery, components and other items and sale of goods. The checks and controls are reviewed by the Audit Committee for improvement in each of these areas on a periodical basis. The internal control systems are improved and modified continuously to meet with changes in business conditions, statutory and accounting requirements.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The financial performance of the Company has been discussed in Directors Report to the Members.

HUMAN RESOURCES

The workforce strength of the Company as on 31.3.2025 stood at 645 including administrative and management staff. The Company maintained harmonious industrial relations across its spinning and windmill unit during the Financial Year 2024-2025.

SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS FOR THE FINANCIAL YEAR 2024-25 AND 2023-24

Comparative key financial ratios are furnished below. The ratios for the financial year 2024-25 comparing with previous financial year 2023-24.

S.No Type of Ratio	Parameter	2024-25	2023-24	% variance	Explanation, if any (where deviation is 25% or more)
1 Debtors Turnover Ratio	Times	7.20	9.20	(0.22)	-
2 Inventory Turnover ratio	Times	5.92	6.70	(0.12)	-
3 Interest Coverage Ratio	Times	(2.46)	(4.16)	(0.41)	Company earned the cash profit for
					the current year is lower than the
					previous year
4 Current Ratio	Times	2.32	2.31	0.50	-
5 Debt Equity Ratio	Times	0.11	0.11	-	-
6 Operating Profit	%	(1.79)	(2.02)	11.38	-
Margin
7 Net Profit Margin	%	(2.26)	(2.06)	(9.34)	-

DETAILS OF ANY CHANGE IN RETURN ON NETWORTH AS COMPARED TO IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF

Return on net worth ratio for the FY 2024-25 at (-) 4.04 % & FY 2023-24 at (-) 3.31% due to loss as explained in the Directors Report.

MEDIUM TERM AND LONG TERM STRATEGIES

Striving to improve quality continuously keeping in pace with technological developments. Giving priority to the requirement of customers, creating new business opportunities and to focus on value maximisation.

	By Order of the Board
	S V ALAGAPPAN
Coimbatore	CHAIRMAN & MANAGING DIRECTOR
22nd May, 2025	DIN 00002450