Shree Balaji Mala Textiles Ltd Management Discussions

You should read the following discussion and analysis of financial condition and results of operations together with our financial
statements included in this Draft Red Herring Prospectus. The following discussion relates to our Company and is based on our
restated financial statements. Our financial statements have been prepared in accordance with Indian GAAP, the accounting
standards and other applicable provisions of the Companies Act.

Note: Statement in the Management Discussion and Analysis Report describing our objectives, outlook, estimates, expectations or
prediction may be "Forward looking statement" within the meaning of applicable securities laws and regulations. Actual results
could differ materially from those expressed or implied. Important factors that could make a difference to our operations include,
among others, economic conditions affecting demand/supply and price conditions in domestic and overseas market in which we
operate, changes in Government Regulations, Tax Laws and other Statutes and incidental factor

BUSINESS OVERVIEW

Our Company was originally incorporated as "Shree Balaji (Mala) Textiles Private Limited" as a private limited company under the
provisions of the Companies Act, 1956, with a Certificate of Incorporation dated September 30, 2005, issued by the Deputy Registrar
of Companies, West Bengal. Subsequently, our Company was converted from a private limited company to a public limited company
pursuant to a special resolution passed in the Extraordinary General Meeting of the Company on February 20, 2025, and the name
of our Company was changed from "Shree Balaji (Mala) Textiles Private Limited" to "Shree Balaji (Mala) Textiles Limited". A
fresh Certificate of Incorporation was issued to our Company by the Central Processing Centre, Manesar, on March 24, 2025. The
Corporate Identification Number of our Company is U17299WB2005PLC105711.

Our Promoter Mr. Binod Kumar Kedia had started his journey as a trader of cotton sarees under the name of "Shree Balaji Textile"
a proprietorship concern in the category of ‘Women Specific Design. In the year 2005, Shree Balaji (Mala) Textiles Private Limited
was incorporated and the proprietorship was taken over by the company through a Business Takeover Agreement dated June 27,
2006. Converted to a public limited company in 2025, we have grown into a B2B saree manufacturer, maintaining core values of
quality and innovation.

Shree Balaji (Mala) Textiles Limited, is a manufacturer and wholesaler of cotton sarees in Indias B2B cotton sarees wholesale
(B2B) segment. We are an old player in cotton sarees segment and our origin into the sarees business dates back to the year 1990s,
wherein our Promoter was engaged in the trading of cotton sarees. Gradually we shifted our business model from trading to pure
play manufacturing of sarees. Our total revenue is generated from sale of cotton sarees. In Fiscal 2025, we have generated sales of
? 19,304.37 lakhs and our product catalogue consists of multiple design options to cater to all genre.

We have seen a slight decline in revenues from operation over the past years were, ?19,622.58 lakhs in F.Y2022-23, ? 19,554.07
lakhs in the FY 2023-24 and 19,304.37 lakhs in the FY 2024-25. Our Net Profit after tax for the above- mentioned periods are ?125.30
lakhs, ? 245.64 lakhs and 494.61 lakhs respectively.

FINANCIAL KPIs OF THE COMPANY:

(Z in Lakhs, Except % and ratios)

	Shree Balaji (Mala) Textiles Limited
Performance	Fiscal 2025	Fiscal 2024	Fiscal 2023
Revenue from operations (1)	19,304.37	19,554.07	19,622.58
Growth in revenue from operations (%)	(1.28%)	(0.35%)	12.31%
Total Income (2)	19,343.56	19,589.37	19,664.39
EBITDA (3)	1,320.04	1,019.27	766.59
EBITDA Margin (%) (4)	6.82%	5.20%	3.90%
PAT (5)	494.61	245.64	125.30
PAT Margin (%) (6)	2.56%	1.26%	0.64%
RoE (%) (7)	25.79%	15.87%	9.23%
RoCE (%) (8)	18.17%	14.36%	11.70%
Debt- Equity Ratio (9)	2.25	3.08	3.39

* Notes:

1. Revenue from Operations: This represents the income generated by the Company from its core operating operation. This gives
information regarding the scale of operations. Other Income is the income generated by the Company from its non core operations.

2. Total income includes revenue from operations and other income.

3. EBITDA means Earnings before interest, taxes, depreciation and amortization expense, which has been arrived at by obtaining
the profit before tax for the year and adding back interest cost, depreciation, and amortization expense.

4. EBITDA margin is calculated as EBITDA as a percentage of Total Income.

5. PAT: Profit for the year represents the restated profits of the Company after deducting all expenses.

6. PAT Margin (%) is calculated as Profit for the year as a percentage of Revenue from Operations.

7. Return on Equity is calculated as Profit after tax, as restated, attributable to the owners of the Company for the year/ period
divided by average equity. Average equity is calculated as average of opening and closing balance of total equity (Shareholde rs
funds) for the year.

8. Return on capital employed calculated as Earnings before interest (excluding lease liabilities and other borrowing cost) and
taxes divided by capital employed as at the end of respective year. (Capital employed calculated as the aggregate value of tangible
net worth, total debt and deferred tax liability)

9. Debt- equity ratio is calculated by dividing total debt by total equity. Total debt represents long-term and short-term borrowings.
Total equity is the sum of share capital and reserves & surplus.

FACTORS AFFECTING OUR RESULT OF OPERATIONS

Except as otherwise stated in this Draft Red Herring Prospectus and the Risk Factors given in the Draft Red Herring Prospectus,
the following important factors could cause actual results to differ materially from the expectations include, among others:

1. General economic and business conditions in the markets in which we operate and in the local, regional, national, and
international economies;

2. Any change in government policies resulting in increases in taxes payable by us;

3. Increased competition in the industry in which we operate;

4. Ability to grow the business;

5. Changes in laws and regulations that apply to the industries in which we operate;

6. Company s ability to successfully implement its growth strategy and expansion plans;

7. Ability to keep pace with rapid changes in technology;

8. Ability to maintain relationships with vendor

9. Inability to successfully obtain registrations in a timely manner or at all;

10. General economic, political, and other risks that are out of our control;

11. Inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices;

12. Any adverse outcome in the legal proceedings in which we are involved;

13. The performance of the financial markets in India and globally

14. Increase in price of raw materials and fuel cost

15. Adverse weather and climatic conditions in the region where we operate

SIGNIFICANT DEVELOPMENTS AFTER MARCH 31, 2025 THAT MAY AFFECT OUR FUTURE RESULTS OF
OPERATIONS

The Directors confirm that there have been no other events or circumstances since the date of the last financial statements as
disclosed in the Draft Red Herring Prospectus which materially or adversely affect or is likely to affect the business or profitability
of our Company or the value of our assets, or our ability to pay liabilities within next twelve months.

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

a) BASIS OF ACCOUNTING AND PREPARATION OF FINANCIAL STATEMENTS

The restated summary statement of assets and liabilities of the Company as at March 31, 2025, March 31, 2024 and March
31, 2023 and the related restated summary statement of profits and loss and cash flows for the year ended March 31, 2025,
March 31, 2024 and March 31, 2023 (herein collectively referred to as ("Restated Summary Statements") have been compiled
by the management from the audited Financial Statements of the Company for the year ended on March 31, 2025, March 31,
2024 and March 31, 2023 approved by the Board of Directors of the Company. Restated Summary Statements have been

prepared to comply in all material respects with the provisions of Part I of Chapter III of the Companies Act, 2013 (the "Act")
read with Companies (Prospectus and Allotment of Securities) Rules, 2014, Securities and Exchange Board of India (Issue
of Capital and Disclosure Requirements) Regulations, 2018 ("ICDR Regulations") issued by SEBI and Guidance note on
Reports in Companies Prospectuses (Revised 2019) ("Guidance Note"). Restated Summary Statements have been prepared
specifically for inclusion in the offer document to be filed by the Company with the BSE in connection with its proposed
SME IPO. The Companys management has recast the Financial Statements in the form required by Schedule III of the
Companies Act, 2013 for the purpose of restated Summary Statements.

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting
Principles in India (Indian GAAP) to comply with the Accounting Standards specified under Section 133 of the Companies
Act, 2013 and the relevant provisions of the Companies Act, 2013 ("the 2013 Act"), as applicable. The financial statements
have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation
of the financial statements are consistent with those followed in the previous year.

Accounting policies not specifically referred to otherwise are consistent and in consonance with generally accepted
accounting principles in India.

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 Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the
acquisition of assets for processing and their realization in cash and cash equivalents, the Company has determined its
operating cycle as twelve months for the purpose of current - non- current classification of assets and liabilities.

b) USE OF ESTIMATES

The preparation of the financial statements in conformity with Indian GAAP requires the Management to make estimates and
assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported
income and expenses during the year. The Management believes that the estimates used in preparation of the financial
statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which the results are known / materialise.

c) PROPERTY, PLANT & EQUIPMENT AND INTANGIBLE ASSETS

(i) Property, Plant & Equipment

All Property, Plant & Equipment are stated at cost less accumulated depreciation and impairment losses, if any. Cost for this
purpose comprises its purchase price and any attributable cost bringing the asset to its working contribution for its intended
use.

(ii) Intangible Assets

Intangible Assets are stated at acquisition cost, net of accumulated amortization and accumulated impairment losses, if any.

d) DEPRECIATION / AMORTISATION

Depreciation on Property, Plant & Equipment is provided to the extent of depreciable amount on the Written down value
method. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.
Depreciation on addition to the Property, Plant & Equipment is provided on a pro-rata basis from the date of put to use.

e) IMPAIRMENT OF ASSETS

The Company assesses at each Balance Sheet date whether there is any indication that an asset may be impaired. If any such
condition exists, the company estimates the recoverable amount of the assets. If such recoverable amount of the asset or
recoverable amount of the cash generating units to which the asset belongs is less than its carrying amount, the carrying
amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the statement
of Profit and Loss Account.

If at the Balance Sheet date there is an indication that previously assessed impairment loss no longer exists, the recoverable
amount is reassessed and the asset is reflected at revised recoverable amount.

f) INVESTMENTS:

Investments intended to be held for not more than a year are classified as current investments. All other investments are
classified as long-term investments. Current investments are carried at lower of cost and market value /realizable value
determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution
in value is made to recognize a decline, other than temporary, in the value of the investments.

g) BORROWING COSTS

Borrowing cost that are attributable to the acquisitions, constitution or production of qualifying assets are capitalised as part
of cost of such assets till such time as the assets is ready for its intended use or sale. A qualifying assets is an asset that
necessarily requires a substantial period of time to get ready for its intended use or sale. All other borrowing costs are
recognised as an expense in the period in which they are incurred.

h) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

The Company recognizes as Provisions, the liabilities being present obligations arising from past events, the settlement of
which is expected to result in an outflow of resources and which can be measured only by using a substantial degree of
estimation.

Contingent Liabilities are generally not provided for in the Accounts and are shown separately in Notes to the Accounts.

i) REVENUE RECOGNITION

Revenue from sale of goods is recognized when all the significant risk and rewards of ownership has been transferred to the
buyer and is stated at net of claims, discount, sales related tax, trade discounts & rebates.

Interest

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Other income

Other items of income are accounted for as and when the right to receive arises.

j) TAXES ON INCOME

Income taxes are accounted for in accordance with Accounting Standard (AS-22) - "Accounting for taxes on income",
notified under Companies (Accounting Standard) Rules, 2021. Income tax comprises of both current and deferred tax.

Current tax is measured on the basis of estimated taxable income and tax credits computed in accordance with the provisions
of the Income-Tax Act, 1961.

The tax effect of the timing differences that result between taxable income and accounting income and are capable of reversal
in one or more subsequent periods are recorded as a deferred tax asset or deferred tax liability. They are measured using
substantially enacted tax rates and tax regulations as of the Balance Sheet date.

Deferred tax assets arising mainly on account of brought forward losses and unabsorbed depreciation under tax laws, are
recognized, only if there is virtual certainty of its realization, supported by convincing evidence. Deferred tax assets on
account of other timing differences are recognized only to the extent there is a reasonable certainty of its realization.

k) INVENTORIES

(i) Raw materials purchased by the company are carried at lower of cost and/or net realisable value.

(ii) Finished and Semi Finished products produced / purchased by the Company are carried at lower of cost and/or Net
realizable Value.

l) CASH AND BANK BALANCES

Cash and cash equivalents comprises Cash-in-hand, Current Accounts, Fixed Deposits with banks. Cash equivalents are short-
term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that
are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value. Other
Bank Balances are short-term balance (with original maturity is more than three months but less than twelve months).

m) EARNINGS PER SHARE

Basic earning per share is computed by dividing the profit/ (loss) after tax (including the post tax effect of extraordinary
items, if any) by the weighted average number of equity share outstanding during the year. Diluted earning per share is
computed by dividing the profit/ (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for
dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential

equity shares, by the weighted average number of equity shares which could have been issued on the conversion of all dilutive
potential equity shares.

n) EMPLOYEE BENEFITS
Defined Contribution Plan

Contributions payable to the recognised provident fund, which is a defined contribution scheme, are charged to the statement of profit and loss.
Defined Benefit Plan

The Company has an obligation towards gratuity a defined benefit retirement plan covering eligible employees The plan provides for lump
sum payment to vested employees at retirement, at death while in employment or on termination of an amount equal to 15 by 26 days salary
payable for each completed years of service without any monetart limit.Vesting occurs upon completion of five years of service. Provision for
gratuity has been made in the books as per actuarial valuation done as at the end of the year.

o) SEGMENT REPORTING

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment
revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their
relationship to the operating activities of the segment. Inter-segment revenue is accounted on the basis of transactions which
are primarily determined based on market / fair value factors. Revenue and expenses have been identified to segments on the
basis of their relationship to the operating activities of the segment.

Revenue, expenses, assets and liabilities which relate to the Company as a whole and are not allocable to segments on
reasonable basis have been included under "unallocated revenue /expenses / assets / liabilities".

Accordingly, no reportable segments have been identified in accordance with Accounting Standard (AS) 17 - Segment
Reporting.

RESULTS OF OUR OPERATIONS

Based on Financial Statements of Profit & Loss as Restated

(Amount % in lakhs)

Particulars	For the year ended 31st March, 2025	% of Total**	For the year ended 31st March, 2024	% of Total**	For the year ended 31st March, 2023	% of Total**
INCOME
Revenue from Operations	19,304.37	99.80%	19,554.07	99.82%	19,622.58	99.79%
Other Income	39.19	0.20%	35.30	0.18%	41.81	0.21%
Total Revenue (A)	19,343.56	100.00%	19,589.37	100.00%	19,664.39	100.00%
EXPENDITURE
Cost of Materials Consumed	11,779.61	60.90%	10,497.18	53.59%	11,155.97	56.73%
Purchase of Stock-in-trade	318.00	1.64%	236.14	1.21%	300.03	1.53%
Changes in inventories of Finished Goods, Work in Progress and Scrap	-2,430.11	-12.56%	-144.72	-0.74%	173.87	0.88%
Employee Benefits Expenses	219.27	1.13%	273.75	1.40%	178.65	0.91%
Finance Costs	631.65	3.27%	661.49	3.38%	567.22	2.88%
Depreciation & Amortisation Expenses	37.35	0.19%	38.52	0.20%	32.73	0.17%
Other Expenses	8,128.42	42.02%	7697.66	39.30%	7089.28	36.05%
Total Expenses (B)	18,684.19	96.59%	19,260.02	98.32%	19,497.75	99.15%
Profit before tax	659.37	3.41%	329.35	1.68%	166.64	0.85%
Tax Expense/ (benefit)
(a) Current Tax Expense	165.44	0.86%	85.43	0.44%	40.16	0.20%
(b) Deferred Tax	-0.68	-0.004%	-1.72	-0.009%	1.18	0.01%
Net tax expense / (benefit)	164.76	0.85%	83.71	0.43%	41.34	0.21%
Profit for the year	494.61	2.56%	245.64	1.25%	125.30	0.64%

**Total refers to Total Revenue

Note: The above figures are based on the Restated Financial Statements of the Company.

Components of our Profit and Loss Account

Income

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

Revenue from Operations

The Revenue from operations as a percentage of our total income was 99.80%, 99.82% and 99.79% for the
Financial Years ended March 31, 2025, March 31, 2024 and March 31, 2023 respectively.

(Amount f in Lakhs)

Particulars	For the year ended 31 March 2025	For the year ended 31 March 2024	For the year ended 31 March 2023
Sale of Goods	19,304.37	19,554.07	19,622.58
TOTAL	19,304.37	19,554.07	19,622.58

Other Income

Our other Income consists of Interest Income, Profit on Sale of Asset, Rental income & Liabilities Written Back.

(Amount f in Lakhs)

Particulars	For the year ended 31 March 2025	For the year ended 31 March 2024	For the year ended 31 March 2023
Interest Income on FDR	13.12	13.00	8.91
Interest from Parties	-	0.94	0.29
Profit on Sale of Vehicle	1.97	0.69	3.90
Rent	15.66	15.65	19.33
Liabilities Written Back	8.44	5.02	9.38
TOTAL	39.19	35.30	41.81

Expenditure

Our total expenditure primarily consists of Purchases, Cost of Materials Consumed, Changes in Inventories,
Employee benefit expenses, Finance costs, Depreciation & Amortisation Expenses and Other Expenses.

Purchase stock in trade

Our purchases comprise of Purchases of Stock.

Employee Benefit Expenses

Our employee benefits expense comprises of Salaries and Wages, Staff Welfare, Directors Remuneration,
Gratuity expense and Contribution to Provident fund & other fund.

Finance costs

Our Finance cost expenses comprise of Interest Expenses, Loan Processing Charges and Brokerage on Loan.

Other Expenses

Our other expenses mainly primarily comprise of Direct and Indirect expenses, which includes:

Direct expenses: Processing Charges, Saree Printing, Transport Charges, Clearing & Forwarding, Labour
Charges, Brokerage on Purchase, Stickers & Labels and Saree Polish Charges.

(Amount f in Lakhs)

Particulars	For the year ended March 31, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Direct Expenses
Processing Charges	670.50	493.77	379.90
Saree Polish Charges	24.65	26.39	18.65
Labour Charges	24.51	16.20	13.33
Saree Sample Charges	2.86	8.15	5.22
Saree Printing	5,717.11	5,476.67	5,122.48
Brokerage on Purchase	72.08	89.88	54.49
Stickers & Labels	38.58	43.70	43.90
Transport Charges	379.44	375.33	357.12
Clearing & Forwarding	91.93	66.36	71.87
Indirect Expenses
Advertisement and Sales Promotion Expenses	321.81	319.52	249.51
Payment to Statutory Auditor	0.95	0.95	0.75
Payment to Cost Auditor	0.50		0.25
Bad debts	26.33	93.90	139.59
Bank charges	4.75	2.77	1.97
Brokerage on Sales	283.23	227.54	214.76
Packing expenses	263.07	263.37	203.63
Printing & stationary expenses	8.96	3.93	2.99
Consultancy Charges	20.26	12.99	16.03
Electricity expenses	8.07	4.49	5.74
General expenses	46.95	30.06	40.75
Filling expenses	0.44	0.38	0.53
Insurance expenses	6.97	5.82	5.56
Keyman Insurance expenses	9.46	9.48	9.46
Legal Expenses	3.66	4.19
Postage and Courier Expense	3.55	3.01	2.85
Subscriptions	0.22	3.92	10.32
Municipal Taxes	0.44	0.40	1.49
Donation		2.21	1.81
Pollution expenses	1.56	1.13	1.51
Other selling and distribution expenses	3.48	8.18	2.75
Rates & Taxes	10.92	1.97	0.29
Rate difference	6.85	39.53	50.29
Rent expense	21.05	12.67	10.50
Repair and maintenance expense	6.37	7.03	9.64
Motor car expenses	15.57	14.76	14.11
Travelling and conveyance	31.34	27.01	25.24
Total	8,128.42	7,697.66	7,089.28

Provision for Tax

The provision for current taxation is computed in accordance with relevant tax regulation. Deferred tax is
recognized on timing differences between the accounting and the taxable income for the year and quantified using
the tax rates and laws enacted or subsequently enacted as on balance sheet date. Deferred tax assets are recognized
and carried forward to the extent that there is a virtual certainly that sufficient future taxable income will be
available against which such deferred tax assets can be realized in future.

Fiscal 2025 compared with Fiscal 2024
Revenue from Operations

The Revenue from Operations of our company for Fiscal year 2025 was Rs 19,304.37 Lakhs against Rs 19,554.07
Lakhs for Fiscal year 2024. A decrease of 1.28% in revenue from operations. This decrease was due to Product
Pricing: Fabrics & thread rates softened over FY25; held, realizations per unit were lower. Credit Policy: Focus
shifted to quality debtors and cash sales, reducing bad debt risk but marginally affecting top-line.

Other Income

The other income of our company for Fiscal year 2025 was Rs 39.19 Lakhs against Rs 35.30 for Fiscal year 2024.
An increase of 11.02% in other income. This increase was due to Liabilities Written Back: Several old liabilities
no longer payable were written off, boosting income.

Total Income

The total income of the company for Fiscal year 2025 was Rs 19,343.56 Lakhs against Rs 19,589.37 Lakhs of Total
income for Fiscal year 2024. A decrease of 1.25% in total income. This decrease was primarily due to the slight
fall in revenue from operations due to reason mentioned above. Other income growth partly offset the decline.

Expenditure

Cost of Material Consumed

In Fiscal 2025, Cost of Material Consumed were Rs 11,779.61 Lakhs against Rs 10,497.18 Lakhs of Cost of Material
Consumed in Fiscal 2024. An increase of 12.22%. This increase was due to Quality Upgrade: Company invested
in better raw material quality, supporting higher pricing and product differentiation.

Purchase of Stock-in-trade

In Fiscal 2025, Purchases of Stock-in-trade were Rs 318.00 Lakhs against Rs 236.14 Lakhs of Purchases of Stock-
in-trade in Fiscal 2024. An increase of 34.67%. This increase was due to the increase in the traded goods this year.

Changes in Inventories

In Fiscal 2025, Changes in Inventories were Rs(2,430.11) Lakhs against Rs(144.72) Lakhs of Changes in Inventories
in Fiscal 2024. This was due to -

Inventory Build-up: we have focused on value added sarees higher stockholding of sarees to meet anticipated
demand and client variety expectations.

Value Added Sarees: because of increase in cost & stock due to increase in value added goods for future prospect.

Working Capital Strategy: Longer holding period adopted to ensure uninterrupted supply in case of market
disruptions.

Employee Benefit Expenses

In Fiscal 2025, the Company incurred employee benefit expenses of Rs 219.27 Lakhs against Rs 273.75 Lakhs
expenses in Fiscal 2024. A decrease of 19.90%. This reduction was primarily on account of Directors
Remuneration: Reduced from 120.00 lakh to 75.00 lakh. Salaries & Wages: Slight moderation to 133.49 lakh.

Finance Costs

The finance costs for the Fiscal 2025 were Rs 631.65 Lakhs while it was Rs 661.49 Lakhs for Fiscal 2024. A decrease
of 4.51%. This decrease was due to Interest Expense: Declined to 621.78 lakh vs 645.92 lakh, due to repayment
of COVID-era term loans. MSME Interest: Dropped significantly to 1.54 lakh vs 5.48 lakh.

Other Expenses

In Fiscal 2025, our other expenses were Rs 8,128.42 Lakhs against Rs 7,697.66 Lakhs in Fiscal 2024. An increase
of 5.60%. This increase was due to the following reasons:

Saree Printing Costs: Increased to 5,717.11 lakh vs 5,476.67 lakh, reflecting focus on premium designs.

Processing Charges: Jumped to 670.50 lakh vs 493.77 lakh, as because in value added sarees, dyeing is
mandatory, leading to higher processing charges.

Increase in number of saree printing & value added sarees.

Profit before Tax

Our Company had reported a profit before tax for the Fiscal 2025 of Rs 659.37 Lakhs against profit before tax of
Rs 329.35 Lakhs in Fiscal 2024. An increase of 100.20%. This increase was primarily driven by -

Improved Gross Margins: Despite revenues almost same, procurement optimization and inventory management
supported margins.

Expense Rationalization: Significant cuts in employee benefits (directors pay) and finance costs.

Quality Focus: Reprocessing defective goods and reselling at higher margins.

Reduced Bad Debts: Tighter credit policy improved bottom line.

Profit after Tax

Profit after tax for the Fiscal 2025 were at t 494.61 Lakhs against profit after tax of t 245.64 Lakhs in fiscal 2024,
An Increase of 101.36%. This increase was primarily driven by Growth in PBT and Effective tax rate broadly
stable, allowing net profits to scale in proportion.

Fiscal 2024 compared with Fiscal 2023
Revenue from Operations

The Revenue from Operations of our company for Fiscal year 2024 was t 19,554.07 Lakhs against t 19,622.58
Lakhs for Fiscal year 2023. A decrease of 0.35% in revenue from operations. This decrease was due to Marginal
fall in fabric & thread rates impacted realizations despite of increase in volume. Increased focus on quality debtors
sales, lower reliance on credit has slightly restricted top-line.

Other Income

The other income of our company for Fiscal year 2024 was t 35.30 Lakhs against t 41.81 for Fiscal year 2023.
The decrease of 15.57% in other income. This decrease was due to Lower write-backs compared to FY23. No
extraordinary gains booked in FY24, leading to reduction.

Total Income

The total income of the company for Fiscal year 2024 was t 19,589.37 Lakhs against t 19,664.39 Lakhs of total
income for Fiscal year 2023. A decrease of 0.38% in total income. This decrease was primarily due to Mainly
driven by small dip in revenue from operations. Lower other income further contributed to marginal decline.

Expenditure

Cost of Material Consumed

In Fiscal 2024, Cost of Material Consumed were t 10,497.18 Lakhs against t 11,155.97 Lakhs of Cost of Material
Consumed in Fiscal 2023. A decrease of 5.91%. This decrease was due to Raw Material Cost Optimization: Better
procurement management lowered costs. Price Correction in Inputs: Textile input prices stabilized compared to
FY23.

Purchase of Stock-in-trade

In Fiscal 2024, Purchase of Stock-in-trade were t 236.14 Lakhs against t 300.03 Lakhs of Purchase of Stock-in-
trade in Fiscal 2023. A decrease of 21.29%. This decrease was due to Reduce in the traded goods this year.

Changes in Inventories

In Fiscal 2024, the Changes in Inventories amounted to t (144.72) Lakhs against t 173.87 Lakhs of changes in
inventories in fiscal 2023. This was due to -

FY24 shows a build-up of closing stock compared to FY23 (finished goods rose).

Strategic decision to maintain wider collections and designs for customer satisfaction.

Employee Benefit Expenses

In Fiscal 2024, the Company incurred employee benefit expenses of t273.75 Lakhs against t178.65 Lakhs
expenses in fiscal 2023. An increase of 53.23%. This increase was due to -

Directors Remuneration: Increased significantly in FY24 t120 lakh vs 54.60 in FY23.

Salaries: Higher at Rs139.68 lakh in FY24 vs Rs110.14 lakh, reflecting expansion in workforce.

Other Benefits: PF, gratuity & welfare costs also rose in line with higher headcount.

Finance Costs

The finance costs for the Fiscal 2024 were Rs 661.49 Lakhs while it was Rs 567.22 Lakhs for Fiscal 2023. An
increase of 16.62%. This increase was due to -

Interest Expense: Increased to Rs645.92 lakhs in FY24 vs Rs565.71 lakhs in FY23, due to higher borrowings.
Higher working capital utilization and delayed MSME payments drove finance cost increase.

MSME Interest: Increased to Rs5.48 lakh, reflecting extended payment cycles.

Other Expenses

In fiscal 2024, our other expenses were Rs 7,697.66 Lakhs and Rs 7,089.28 Lakhs in fiscal 2023. An increase of
8.58%. This increase was due to -

Saree Printing Costs: Increased to Rs5,476.67 lakh vs Rs5,122.48 lakh, aligned with higher production variety &
quantity.

Processing Charges: Rose to Rs493.77 lakh vs Rs379.90 lakh
Overheads & Admin Costs: Moderate increase with scale of operations.

Profit before Tax

Our Company had reported a profit before tax for the Fiscal 2024 of Rs 329.35 Lakhs against profit before tax of Rs
166.64 Lakhs in Fiscal 2023. An increase of 97.64%. This increase was primarily due to the Lower Raw Material
Costs & aided with higher quantity production resulted in better margins. Despite higher employee & finance
costs, efficiency in material consumption and better sales mix improved profitability.

Profit after Tax

Profit after tax for the Fiscal 2024 were at Rs 245.64 Lakhs against profit after tax of Rs 125.30 Lakhs in fiscal
2023. An increase of 96.04%. This increase was primarily due to Increase in PBT and other reasons mentioned
above.

Cash Flows

(Amount Rs in lakhs)

Particulars	For the year ended March 31, 2025	For the year ended March 31, 2024	For the year ended March 31, 2023
Net Cash Flow from / (used in) Operating Activities	878.87	400.33	740.69
Net Cash Flow from / (used in) Investing Activities	(20.30)	0.12	(8.69)
Net Cash Flow from / (used in) Financing Activities	(885.48)	(346.13)	(781.62)

Cash Flows from Operating Activities

1. In Fiscal 2025, Net cash flow from operating activities was Rs878.87 Lakhs. This comprised of the net
profit before tax of Rs659.37 Lakhs, which was primarily adjusted for Interest cost of Rs623.57 Lakhs,
Provision for Gratuity of Rs4.96 Lakhs, Depreciation and Amortisation expense of Rs37.35 Lakhs,
Liabilities written-back of Rs8.44 Lakhs, Interest income of Rs13.12 Lakhs and Profit on sale of assets of
Rs1.97 Lakhs. The resultant operating profit before working capital changes was Rs1,301.72 Lakhs, which
was primarily adjusted for an increase in Inventories of Rs1,044.78 Lakhs, Trade Receivables of Rs188.42
Lakhs, Short-term loans and advances of Rs70.86 Lakhs and Other Non-current assets of Rs1.65 Lakhs,
along with the decrease in Other Bank Balances of Rs139.21 Lakhs. Additionally, there was an increase
in Trade Payables of Rs341.96 Lakhs and in Other Current Liabilities & Provisions of Rs515.26 Lakhs.

Cash generated from operations was Rs992.44 Lakhs, which was reduced by Income Tax paid of Rs113.57

Lakhs, resulting in a net cash flow from operating activities of Rs878.87 Lakhs.

2. In Fiscal 2024, Net cash flow from operating activities was Rs400.33 Lakhs. This comprised of the net
profit before tax of Rs329.35 Lakhs, which was primarily adjusted for Interest cost of Rs654.82 Lakhs,
Provision for Gratuity of Rs6.42 Lakhs, Depreciation and Amortisation expense of Rs38.52 Lakhs,
Liabilities written-back of Rs5.02 Lakhs and Interest income of Rs13.94 Lakhs. The resultant operating
profit before working capital changes was Rs1,010.15 Lakhs, which was primarily adjusted for an increase
in Inventories of Rs356.01 Lakhs and a decrease in Trade Receivables of Rs790.77 Lakhs, Short-term loans
and advances of Rs7.95 Lakhs, Other Non-current assets of Rs2.00 Lakhs and an increase in Other Bank
Balances of Rs165.88 Lakhs. Additionally, there was a decrease in Trade Payables of Rs123.87 Lakhs and
a decrease in Other Current Liabilities & Provisions of Rs690.90 Lakhs.

Cash generated from operations was Rs474.21 Lakhs, which was reduced by Income Tax paid of Rs73.88
Lakhs, resulting in a net cash flow from operating activities of Rs400.33 Lakhs.

3. In Fiscal 2023, Net cash flow from operating activities was Rs740.69 Lakhs. This comprised of the net
profit before tax of Rs166.64 Lakhs, which was primarily adjusted for Interest cost of Rs567.22 Lakhs,
Provision for Gratuity of Rs5.02 Lakhs, Depreciation and Amortisation expense of Rs32.73 Lakhs,
Liabilities written-back of Rs9.38 Lakhs, Interest income of Rs9.20 Lakhs and Profit on sale of assets of
Rs3.90 Lakhs. The resultant operating profit before working capital changes was Rs749.13 Lakhs, which
was primarily adjusted for a decrease in Inventories of Rs301.57 Lakhs and an increase in Trade
Receivables of Rs643.32 Lakhs, decrease in Short-term loans and advances of Rs18.33 Lakhs, Other Non-
current assets of Rs0.65 Lakhs and an increase in Other Bank Balances of Rs8.03 Lakhs. Additionally, there
was an increase in Trade Payables of Rs52.18 Lakhs and in Other Current Liabilities & Provisions of
Rs306.44 Lakhs.

Cash generated from operations was Rs776.95 Lakhs, which was reduced by Income Tax paid of Rs36.26
Lakhs, resulting in a net cash flow from operating activities of Rs740.69 Lakhs.

Cash Flows from Investment Activities

1. For the year ended March 31, 2025, net cash used in investing activities was Rs20.30 Lakhs. This primarily
comprised purchase of property, plant & equipment and intangible assets of Rs36.73 Lakhs, partially offset
by proceeds from sale of property, plant & equipment of Rs3.31 Lakhs and interest income received of
Rs13.12 Lakhs.

2. For the year ended March 31, 2024, net cash generated from investing activities was Rs0.12 Lakhs. This
mainly included purchase of property, plant & equipment of Rs13.82 Lakhs offset by interest income
received of Rs13.94 Lakhs.

3. For the year ended March 31, 2023, net cash used in investing activities was Rs8.69 Lakhs. This primarily
comprised purchase of property, plant & equipment and intangible assets of Rs25.08 Lakhs, partly offset
by proceeds from sale of property, plant & equipment of Rs7.19 Lakhs and interest income received of
Rs9.20 Lakhs.

Cash Flows from Financing Activities

1. In Fiscal 2025, net cash used in financing activities was Rs885.48 Lakhs. This comprised proceeds from
borrowings of Rs4,046.27 Lakhs, repayment of borrowings of Rs4,308.18 Lakhs and finance cost paid of
Rs623.57 Lakhs.

2. In Fiscal 2024, net cash used in financing activities was Rs346.13 Lakhs. This comprised proceeds from
borrowings of Rs2,292.18 Lakhs, repayment of borrowings of Rs1,983.49 Lakhs and finance cost paid of
Rs654.82 Lakhs.

3. In Fiscal 2023, net cash used in financing activities was Rs781.62 Lakhs. This comprised proceeds from

borrowings of Rs512.73 Lakhs, repayment of borrowings of Rs727.13 Lakhs and finance cost paid of
Rs567.22 Lakhs.

OTHER MATTERS

1. Unusual or infrequent events or transactions

There has not been any unusual trend on account of our business activity. Except as disclosed in this Draft
Red Herring Prospectus, there are no unusual or infrequent events or transactions in our Company.

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

Other than as described in the Section titled "Financial Information" and chapter titled "Managements
Discussion and Analysis of Financial Conditions and Results of Operations," beginning on Page 179 and 188
respectively of this Draft Red Herring Prospectus, to our knowledge there are no significant economic
changes that materially affected or are likely to affect income from continuing Operations.

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

Apart from the risks as disclosed under Chapter titled "Risk Factors" beginning on page no. 32 in this 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 relationship between costs and revenues, in case of events such as future increase in
labour or material costs or prices that will cause a material change are known

Our Companys future costs and revenues will be determined by demand/supply situation, both of the end
products as well as the government policies and other economic factors.

5. Extent to which material increases in net sales or revenue are due to increased sales volume, introduction
of new products or increased sales prices.

Increases in revenues are by and large linked to increases in volume of business and also dependent on the
price realization on our products/services.

6. Total turnover of each major industry segment in which the issuer company operated.

Relevant Industry data and, as available, has been included in the chapter titled "Industry Overview"
beginning on page no.112 of this Draft Red Herring Prospectus.

7. The extent to which business is seasonal.

Our business is dependent to a certain extent on the seasonal, environmental and climate changes. Hence, our
business is seasonal in nature.

8. Any significant dependence on a single or few suppliers or customer

Our Business is dependent on network of retailers, wholesalers and dealers with the maximum contribution
by the retailers. Our top ten retailers contribute about 2.48%, 3.98% and 3.88% of our revenues from
operations for the year ended March 31, 2025, March 31, 2024 and March 31, 2023.