Signoria Creation Ltd Management Discussions

ECONOMIC REVIEW

Global economy Overview

The year 2025 marks a period of modest but steady global expansion against a backdrop of persistent policy uncertainty and intensifying trade tensions. The International Monetary Fund (IMF) forecasts global real GDP growth at 2.8% in 2025, a downward revision from previous estimates and well below the 2000–19 average of 3.7%. Inflation is also expected to decline, reaching an estimated 4.2% in 2025, advanced economies are projected to return to their inflation targets earlier than emerging and developing peers. The subdued global growth mainly reflects the effects of tighter monetary policy, reduced international cooperation and elevated tariff rates considered the highest in a century which are weighing on trade and investment flows. Downside risks dominate the outlook, especially as governments recalibrate policy amidst demographic shifts, labor market mismatches and financial volatility.

Detailed performance overview of major economies (Source: IMF)

United States: Growth in the U.S. is forecast at 1.8% in 2025, revised downward due to ongoing policy uncertainty, trade frictions and weaker business sentiment. Despite robust labor markets and moderated core inflation, the impact of higher borrowing costs and substantial fiscal tightening is likely to moderate consumer and investment spending. Euro Area: The euro area economy is projected to grow at 1.5% in 2025 as it emerges from a mild recession, with persistent weakness in Germany and Italy offset by moderate gains elsewhere. Private consumption and government spending are providing support, but external demand and manufacturing remain weak due to slowing global trade and lingering energy concerns. Japan: Japans real GDP growth is forecast to slow to 0.6% for 2025. This deceleration reflects a fading post-pandemic rebound, population aging and the effects of global supply chain realignments. Weak consumer spending and inflationary pressures continue to challenge policymakers. China: Chinas growth is set to drop to 4.0% in 2025, a significant deceleration from earlier years. Ongoing property market strains, reduced consumer confidence, policy realignment and external headwinds from global trade disputes are all weighing on momentum.

Other major economies

Germany: Predicted to see modest recovery with growth around 1.3% as manufacturing stabilizes and energy prices moderate.

United Kingdom and France: Both expected to register between 1–1.5% growth, supported by easing inflation and fiscal policy adjustments.

Brazil and Canada: Anticipate growth of 2% and 1.6%, respectively, driven by commodity exports and resilient services but still vulnerable to global demand swings.

Outlook

The IMF projects global growth will edge up slightly to 3.0% in 2026, but remain below historical averages. The world economy faces significant headwinds: continued high policy uncertainty, slowdowns in China and major developed markets, persistent trade tensions, shifting supply chains and demographic drags from aging populations.

While global inflation is forecast to continue declining, volatile commodity prices and supply-side disruptions could slow this pace. Advanced economies are expected to reach their inflation targets sooner than emerging markets, aided by tighter monetary and fiscal policies.

Key Risks and Opportunities

Trade Policy Uncertainty: Ongoing trade frictions and tariff escalations could significantly depress investment and slow recovery; stronger international cooperation and predictable policy frameworks will be critical for sustained growth.

Demographics and Labor: The aging population, especially in developed economies, will require targeted reforms and improved labor market integration, including migration and upskilling, to sustain productivity.

Structural Reforms: Unlocking medium-term growth requires embracing digitalization, innovation, sustainability imperatives and inclusive policy frameworks.

Emerging Markets: These economies, led by India and select ASEAN countries, are projected to contribute an outsized share of global growth, but face volatility from external shocks and capital flows.

Source:

1. https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025

2. https://www.imf.org/en/Publications/WEO/Issues/2025/01/17/world-economic- outlook-update-january-2025 3. https://www.imf.org/external/datamapper/index.php

4. https://www.drishtiias.com/daily-updates/daily-news-analysis/2025-world-economic-outlook-report 5. https://www.cnbc.com/2025/04/23/imf-cuts-2025-growth-forecast-for-major-asian-economies.html 6. https://www.statista.com/chart/30484/forecast-for- real-gdp-growth-in-the-worlds-largest-economies/ 7. https://www.imf.org/en/Countries/IND

Indian Economy Overview

India reaffirmed itself as the fastest-growing major economy in the world in FY2024–25, exhibiting impressive resilience amidst global headwinds. The International Monetary Fund (IMF) projects real GDP growth at 6.5% for 2024–25, driven by robust domestic demand, improved macroeconomic stability and policy reforms facilitating investment and productivity gains. This momentum comes after a stellar GDP rise of 8.2% in the previous year, indicating solid economic fundamentals and the effectiveness of structural reforms.

Key macroeconomic achievements:

Nominal GDP for FY2024–25 is estimated at 330.68 lakh crore, with a nominal growth rate of 9.8%.

Inflation has moderated consistently, averaging close to the 4% target, thus supporting real income growth and stable consumption.

Indias financial sector continues to demonstrate resilience, with non-performing loan ratios at multi-year lows and continued credit growth supporting the private sector.

Economic outlook: Why growth is expected to remain strong

Indias near-term economic outlook is anchored in a convergence of several powerful drivers. Ongoing structural reforms ranging from effective implementation of GST and the Insolvency and Bankruptcy Code to rationalized labor laws have systematically boosted the formalization of economic activity and improved business efficiency, fostering a supportive ecosystem for investment and productivity gains. A significant uptick in public capital expenditure has been observed, particularly in the infrastructure domain. Robust expenditure on national highways, railways, energy and smart cities has catalyzed further job creation and enhanced private sector confidence. CRISIL reports that central government capital expenditure surged by 38.7% year-on-year in May, while major states posted a cumulative increase of 44.7% in the same period, underlining a resolute policy push to crowd in private investment activity. While private capital expenditure recovery is progressing at a cautious pace owing to lingering global uncertainties and cautious corporate sentiment, anticipated monetary policy easing and policy continuity should further fuel private investment in the latter half of the fiscal year.

Maintaining macro-financial stability remains a cornerstone of Indias strong outlook. The governments commitment to fiscal consolidation, evidenced by prudent budget targets, lends credibility to the medium-term growth narrative. Concurrently, the financial sector retains strength through high capital adequacy and proactively addressed asset quality issues, safeguarding against shocks. Demographic and urbanization tailwinds continue to be a formidable growth engine for the economy. A young, expanding workforce and rapid migration from rural to urban centers are increasing labor force participation and stimulating both entrepreneurial activity and consumer aspirations. The accelerated adoption of digital technology across sectors from payments and services to industry has improved productivity and opened new business opportunities. Export performance further adds to the growth equation. India is steadily integrating into global supply chains in technology, pharmaceuticals and textiles, while production-linked incentive (PLI) schemes and bilateral trade agreements increase the competitiveness of Indian manufacturing abroad. Although risks such as persistent global trade tensions, climate risks and geopolitical variability persist, Indias large, diversified market and strong remittance inflows offer vital buffers.

Private Final Consumption Expenditure (PFCE) and Clothing Consumption

Private Final Consumption Expenditure (PFCE) has reasserted its dominance as a growth lever. In FY2024–25, PFCE contributed 61.4% of nominal GDP, the largest share in over two decades, as per the National Statistical Office. This resilience stems from a 7.2% rise in PFCE, well above the 5.6% growth registered a year earlier, signaling a robust recovery in household demand.

The uptick in PFCE is attributed to several developments. Real incomes have improved on the back of stable inflation and healthy agricultural output, especially following an above-normal monsoon. Both rural and urban markets are contributing, with a normalization in rural demand and ongoing expansion among the urban middle class, which is driving up discretionary spending on vehicles, consumer durables and lifestyle goods. The rapid spread of digital payments and e-commerce has further enabled this consumption surge, notably among the middle class and rural consumers. Within this consumption revival, the clothing and footwear sector stands out. Recent analysis by HSBC Global Investment Research indicates Indias apparel market is set to grow at a compound annual growth rate (CAGR) of 11% over FY2024–FY2029, in line with the expansion of nominal GDP and the broader PFCE trend. A significant shift is evident in consumer preferences, where branded segments, supported by wider availability and affordability, have grown at a CAGR of 16% over the past decade more than triple the pace of unbranded categories. Apparel exports have also surged, posting a 14.4% year-on-year rise in April 2025. The continued boom in organized retail, the ascendance of e-commerce and shifting tastes toward casual and activewear have positioned the clothing category as a key beneficiary of Indias vibrant consumption story. In conclusion, Indias growth trajectory in FY2024–25 is underpinned by a robust combination of policy-driven investments, macro-financial stability, demographic momentum and a resurgence in private consumption. Within this, sectors like clothing exemplify the evolving aspirations and spending power of Indias households, ensuring the consumption engine remains central to the nations economic journey.

INDUSTRY STRUCTURE AND DEVELOPMENT Global textile and apparel industry

The global textile and apparel market remains highly fragmented, marked by the coexistence of major international brands, regional giants and numerous smaller local players. Developed economies see strong penetration by established brands, while developing regions remain largely unorganized and feature a diversity of indigenous products and styles. Global brands, leveraging extensive distribution networks, continue to shape market trends internationally but encounter fierce competition from local manufacturers, especially regarding regional fashion preferences, pricing and agility in meeting local demands. The market is traditionally segmented by end-users (Men, Women and Children) and types of products (Formal Wear, Casual Wear, Sportswear, Nightwear and Other Types), with further stratification by price category, distribution channel and material used.

Global textile market

The global textile market reached a valuation of US$1,976.84 billion in 2024 and is projected to rise to roughly US$4,016.50 billion by 2034, reflecting a robust CAGR of 7.35% from 2025 to 2034. Another notable estimate places the 2024 market size at US$2,010.76 billion, growing to US$3,665.72 billion by 2033, with a CAGR of 6.9% through 2025–2033. The market trajectory underscores the industrys significant global scale and its accelerating expansion.

Growth drivers

Shifting consumer preferences toward sustainability, comfort and performance, leading to increased demand for eco-friendly and organic textiles.

Rapid population growth, especially in Asia-Pacific, fuelling overall textile consumption.

Technological advancements in smart fabrics and automated production, improving efficiency and product innovation.

Government regulations and sustainability initiatives pushing manufacturers to adopt clean, low-emission and resource-efficient processes.

Expansion of e-commerce, enabling broader market access and facilitating the global reach of both established and emerging brands. Asia-Pacific dominates the global textile market, accounting for a substantial share due to easy availability of raw materials, presence of major industry clusters and increasing disposable income among the young population.

Sustainability trends

The demand for eco-friendly and organic fabrics such as hemp, recycled polyester and organic cotton has surged globally. This is a result of heightened environmental awareness among consumers and regulatory pressure on manufacturers to reduce chemical use and adopt sustainable sourcing and processing methods. Brands are innovating by introducing natural, functional and recycled fibers to align with market preferences.

Global apparel market

The global apparel market reached an estimated value of US$1.75 trillion in 2024 and is expected to rise to US$2.31 trillion by 2032, registering a CAGR of 3.52% between 2024 and 2032. Another recent estimate pegs the market at US$1.77 trillion in 2024, projected to hit US$2.26 trillion by 2030, growing at a CAGR of 4.2% from 2025 to 2030. In terms of trade, the global textile and apparel trade exceeded US$900 billion in 2021 and is on track to reach US$1.2 trillion by 2030, growing at an anticipated CAGR of 4%.

Key growth factors

Fast fashion and innovative design cycles quickly bring new styles to market, spurring higher purchase frequency.

Rise of e-commerce and digital marketing, offering convenience and an expanded range of choices for consumers globally.

Increasing per capita income and a shift toward branded, luxury and premium products, especially in emerging economies, fuel demand for both mass-market and upscale apparel.

Local startups and D2C brands with distinctive sustainable positioning and contemporary designs are gaining rapid traction, reflecting the consumer appetite for niche, ethical and trendy fashion.

Move toward ethical production, including the use of recycled fabrics and transparency around fair labor practices, is becoming a must-have for market leaders.

Regional and segment trends

The Asia-Pacific region continues to lead, accounting for over 40% of global apparel sales in 2023–24, thanks to demographic advantages, a burgeoning middle class and the rapid adoption of digital channels. North America and Europe remain substantial markets, driven by established consumer bases and strong infrastructure for omnichannel retail.

Competitive landscape

The global textile and apparel industry remains intensely competitive:

Large-scale international companies wield influence through expansive product portfolios and global distribution channels.

A vibrant segment of local manufacturers and startups, especially in emerging economies, tailors offerings to regional tastes, price points and fashion cycles.

The markets fragmentation is further deepened by evolving consumer preferences, which emphasize variety, sustainability and affordability, prompting both large and small players to innovate rapidly.

Outlook

Looking ahead to 2032–34, the textile and apparel industry is set for steady, innovation-driven growth. Sustainability, digitalization of the supply chain and automation will be crucial themes. As consumer focus on eco-friendliness and personalization intensifies, companies that rapidly adapt to these trends whether through smart textiles, AI-driven production, or circular business models are poised to maintain an edge. Moreover, the increasing formalization and organization of retail in developing regions may gradually erode the dominance of the unorganized sector, offering further growth and consolidation opportunities.

Source:

1. https://www.precedenceresearch.com/textile-market 2. https://straitsresearch.com/report/textile-market 3. https://www.imarcgroup.com/textile-market

4. https://www.fortunebusinessinsights.com/apparel-market-110718

5. https://www.grandviewresearch.com/industry-analysis/apparel-market-report

Indian textile and apparel industry

Indias textile and apparel industry, a symbol of both cultural legacy and industrial resilience, has entered a defining phase of expansion and modernization in FY2024–25. With transformative government reforms, renewed export strategies and evolving consumer preferences, the industry has witnessed a resurgence that not only strengthens its domestic relevance but also enhances its global stature. The domestic apparel market grew impressively from US$106 billion in FY2019–20 to US$147 billion in FY2024–25, registering a steady CAGR of 7%. This trajectory is set to continue, with projections pointing to US$190 billion by FY2025–26, driven by rising income levels, urbanization, fashion consciousness and organized retail penetration.

Indias textile and apparel exports including ready-made garments (RMG), cotton and man-made textiles clocked US$21.36 billion in April–October 2024, growing 7% year-on-year. RMG exports alone surged by 11.3% year-on-year in May 2025, underlining the sectors increasing competitiveness.

Although cotton and man-made textiles continue to drive significant export volumes, womens ethnic and fashion wear has emerged as a rising star in value-added apparel exports. Indian festive and traditional wear is especially sought after in markets such as the US, UK, Middle East and diaspora-led geographies, where demand remains robust and seasonal spikes drive value growth. A significant inflection points for exports arrived with the signing of the India–UK Free Trade Agreement (FTA) in May 2025. By eliminating textile tariffs (previously 8–12%), the FTA gave Indian apparel particularly ethnic and celebration wear a considerable price and supply chain edge. As a result, exports to the UK are projected to rise by 30–45%, with brands in textile centers like Surat, Jaipur and Lucknow expected to especially benefit.

Government support and strategic infrastructure

Policy support has been pivotal in shaping the future of Indias textile sector. PM MITRA Parks (Mega Integrated Textile Region and Apparel) are being developed to consolidate spinning, weaving and garmenting units in one ecosystem, boosting efficiency, sustainability and scale. The Production Linked Incentive (PLI) Scheme further incentivizes domestic manufacturing of value-added textiles, while government investments in logistics, digitization and skill development aim to reduce turnaround times and enhance productivity. Moreover, ongoing efforts to formalize artisanal and regional clusters especially those involved in ethnic and fashion wear have strengthened the local-to-global pipeline. These initiatives are expected to generate over 2 million jobs and attract investments exceeding 70,000 crore, solidifying Indias global leadership in textile production.

Growth catalysts in the domestic market

Indias burgeoning fashion ecosystem is the product of multiple intersecting economic and cultural trends. Rising disposable incomes, particularly among the urban and semi-urban middle class, are fueling an appetite for high-quality and premium apparel. Tier II and III cities are quickly emerging as vibrant retail hubs, empowered by e-commerce platforms that have democratized access to diverse fashion lines formerly limited to metros. The nations deep-rooted cultural affinity for traditional attire continues to sustain demand for ethnic wear, particularly during life events such as weddings and festivals.

Concurrently, digital engagement and influencer-led commerce are transforming how consumers discover and purchase apparel, leading to a surge in ethnic fashion experiments and mass trends. The movement toward sustainability is also reshaping consumer choices both brands and buyers are becoming more conscious, favoring eco-friendly and artisanal production models that carry social and environmental value.

Indian womens ethnic and fashion wear: Tradition reimagined

In FY2024–25, womens ethnic and Indian fashion wear accounted for an estimated 28–30% of the overall domestic apparel market, making it the largest segment by value. This includes saris, lehengas, salwar suits, kurtas, dupattas and fusion wear rooted in Indian design but adapted to modern tastes. While the market share is projected to slightly moderate to 25–28% by FY2029, the category remains irreplaceable for celebration, ritual and traditional occasions. The evolution lies not in displacement but in redefinition with contemporary consumers blending heritage with innovation.

Saris and blouses continue to dominate the ethnic wear landscape, witnessing a revival of handloom crafts, increased use of digital prints and festive premiumization. Salwar suits and kurtas are popular for both daily and formal use, evolving into workwear-friendly options adorned with embroidery and reflecting Indo-ethnic versatility. In festive and wedding contexts, lehengas and anarkalis lead, spurred by the influence of bridal couture, luxury brands and celebrities. While dupattas and accessories occupy a niche position, their personalized and mix-and-match potential is gaining popularity. Meanwhile, the modern Indian fusion segment is fast-expanding through innovative uses of ethnic fabrics, boutique-led urban tailoring and designer evolution, though it remains distinct from global westernwear aesthetics.

Consumption drivers and lifestyle shifts

Celebration remains at the heart of ethnic wear spending. Weddings, religious festivals and large-scale cultural events drive the premium segment. Furthermore, e-commerce platforms such as Myntra and Ajio, along with exclusive brand websites, have made ethnic fashion widely accessible in small towns, enabling local shoppers to access curated collections and personalized services once reserved for major metros. The rise of customization is shaping the market, with consumers increasingly seeking personal styling, local design sensibilities and perfect fits tailored to their regional heritage. Sustainability has become a powerful motivator as buyers favor handwoven fabrics, natural dyes and supporting artisan livelihoods as part of the garments narrative. Wearing Indian ethnic wear today is seen as a blend of rooted pride and modern sophistication an identity particularly celebrated by Gen Z and millennials.

Export opportunities in ethnic fashion

In FY2024–25, exports of womens ethnic and fashion wear (excluding innerwear, westernwear and related categories) reached approximately US$15.99 billion, with strong demand from the US, UK, Canada, Middle East and Southeast Asia. diaspora-driven fashion trends, continue to elevate Indias visibility as a premium ethnic wear exporter. Indian products such as sarees, lehengas, designer kurtis and embroidered suits are now increasingly found in international multi-brand retail and on global fashion aggregator platforms.

Challenges on the horizon

Despite favorable trends, the sector contends with several structural challenges. Rising production and labor costs put pressure on margins, necessitating even greater efficiency and innovation in value addition. Rapidly shifting consumer preferences, influenced by social media and the fast fashion movement, require brands to keep innovating both in design and supply chain agility. Environmental concerns loom large as issues surrounding waste generation, water usage and carbon emissions demand more sustainable production models. On top of these, global competition continues to intensify, particularly from countries known for low labor costs and highly streamlined production processes.

Vision 2025–26 and beyond: The ethnic fashion advantage

Indias roadmap for textile industry leadership is underpinned by its strengths in ethnic and fashion wear. Flagship initiatives, such as Skill India and credit facilities are empowering micro and small players to scale up, while the PM MITRA Parks promise to modernize the value chain from weavers to boutique exporters.

Fashion-tech innovation is another growth lever: tools like AI-driven sizing, virtual trial rooms and influencer-led commerce are rapidly changing the ethnic wear retail experience making it more engaging, efficient and global. Indias textile resurgence is not just statistical it is stylistic, cultural and strategic. Womens ethnic and Indian fashion wear embodies this transformation: a segment where tradition meets technology, heritage weaves into aspiration and every outfit tells a story of continuity and change. As India marches toward US$65 billion in textile and apparel exports by FY2025–26 and an expanded domestic market, womens ethnic wear stands as both a pillar of identity and a global growth engine.

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BUSINESS AND FINANCIAL OVERVIEW

Signoria Creation Limited, originally incorporated as "Signoria Creation Private Limited" in Jaipur under the Companies Act, 2013, transitioned into a public limited company on July 28, 2023. Upon conversion, the company adopted its current name, "Signoria Creation Limited." The registered office is located at Plot No.H1-74, RIICO Industrial Area, Mansarovar, Jaipur, Rajasthan – 302020. The Company is engaged in the manufacturing, marketing, and retailing of womens apparel, with a diversified product portfolio that includes kurtis, pants, tops, co-ord sets, dupattas, and gowns. Signoria is the flagship brand under which the Company operates and is well-recognized in the apparel market for its traditional yet contemporary range of kurtis celebrated for their vibrant colours, intricate patterns, and inclusive sizing. Designed for todays modern woman, Signorias collections blend comfort, style, and individuality, appealing to customers who seek fashionable attire that makes a statement. Under the leadership of a passionate and experienced promoter team Mr. Vasudev Agarwal, Mrs. Babita Agarwal, Mr. Mohit Agarwal and Ms. Kritika Chachan, the Company has steadily built a strong brand identity. Their collective expertise in the textile and apparel industry, supported by a committed team, has laid the foundation for growth and brand loyalty. With increasing digital penetration, a rise in fashion-conscious consumers, and growing support from government initiatives, the Company aims to expand its footprint across India. Backed by the momentum of the booming e-commerce sector and the enduring appeal of ethnic and contemporary fashion, Signoria Creation Limited envisions becoming a household name in womens fashion across the country. The Companys financial statements are prepared in accordance with the Indian Accounting Standards (Ind AS) as prescribed by the Ministry of Corporate Affairs under Section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules, 2015 (as amended), and other generally accepted accounting principles in India.

Brief financial performance for F.Y. 2024-25:

Particulars	Year ended March 31, 2025	Year ended March 31, 2024
Revenue from Operations	2718.98	1954.31
EBDITA	486.67	393.00
Interest and Financial Charges	80.65	63.13
Tax expenses	104.50	88.80
Net Profit	301.85	240.86

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in Key Financial Ratios, alongwith detailed explanations thereof including:

Ratios	FY2024-25	FY2023-24	% Change	Reason (if more than 25% change)
Debtors Turnover	2.04	1.68	21.58	NA
Inventory Turnover	2.18	3.28	-33.39	Due to Increase in Average Inventory
Interest Coverage Ratio	6.56	6.40	2.5	NA
Current Ratio	1.55	2.08	-25.72	Due to Increase in Current Liabilities
Debt Equity Ratio	0.69	0.62	11.86	NA
Operating Profit Margin (%)	17.90	20.11	-10.99	NA
Net Profit Margin (%)	11.10	12.32	-9.92	NA
Return in Net Worth (%)	19.71	17.57	12.16	NA

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has established a robust framework of internal financial controls that are well-aligned with the nature, size, and complexity of its operations. These controls have been designed to ensure the integrity of financial reporting and are considered adequate and effective with respect to the preparation of financial statements. During the year, the internal control systems were subjected to rigorous testing, and no material weaknesses in either their design or implementation were identified. To uphold independence and maintain objectivity, the Internal Auditor directly reports to the Audit Committee of the Board. This structure facilitates comprehensive oversight of internal control processes and ensures timely corrective actions wherever necessary. The Companys internal financial control (IFC) environment has been periodically reviewed, and necessary enhancements have been implemented to further strengthen financial discipline, accuracy in reporting, and overall risk management protocols. Well-documented standard operating procedures are in place to ensure the safeguarding of assets, prevention and detection of fraud and errors, accuracy and completeness of accounting records, and proper authorization and documentation of all transactions. M/s Vinod Singhal & Co. LLP, the Statutory Auditors of the Company, have audited the financial statements presented in this Annual Report and have also issued an attestation report on the Companys internal control over financial reporting in accordance with Section 143 of the Companies Act, 2013. Additionally, the Company has engaged M/s. AJMK & Associates as its Internal Auditor to independently evaluate and monitor internal processes. The internal audit function is aligned with the Companys operational footprint and risk profile, with a strong emphasis on reviewing internal controls, assessing business risks, and recommending process improvements across functions.

RISKS AND CONCERN

Signoria Creation Limited operates predominantly in the womens ethnic and contemporary apparel sector, with an expanding presence both domestically and in exports. Given the highly fragmented and competitive nature of the textile and garment industry, the Company is exposed to a wide range of business, operational, market, and regulatory risks that could impact its growth and profitability. Recognizing these challenges, Signoria Creation has instituted a comprehensive risk management framework operating at multiple levels of the organization, focused on the early identification, evaluation, and proactive mitigation of key risks. The Company periodically reviews and updates its risk controls to ensure adaptability in response to evolving industry trends, regulatory changes, raw material price fluctuations, supply chain complexities, and macroeconomic shifts. Major enterprise-level risks and the specific mitigation strategies being pursued by the Company are summarized below:

Type of Risk	Risk Analysis	Risk Mitigation
Business & Market Risk	Highly fragmented textile and apparel sector; intense competition from organized and unorganized players, with frequent changes in consumer preferences. Heavy reliance on demand during the festive/wedding season and cyclical trends. Uncertainty in sales and profits due to industry structure.	Product innovation and diversification, trend monitoring, efforts to expand into B2C and exports to mitigate demand fluctuations.
Customer & Supplier Dependency	Substantial portion of revenues from top clients and reliance on select suppliers/job workers for input and manufacturing. Loss of a key client or supplier, or any disruption, could materially affect business.	Diversification of customer base and expansion of supplier network; building collaborative relationships and contingency sourcing.
Operational Risks	Raw material price volatility (especially cotton), production delays, and dependence on factors such as skilled labor, timely logistics, and manufacturing quality control.	Bulk procurement, inventory buffers, ongoing training, and process automation; periodic supplier and operational audits.
Regulatory & Compliance Risks	Subject to frequent policy changes in textile industry, GST laws, environmental regulations, and labor statutes. Non-compliance may result in penalties or business restrictions. Changes in export/import policies, duties, or anti-dumping measures also impact operations.	Legal compliance team to monitor regulatory updates, regular training, and robust internal checks; sustainable/environmentally aligned practices.
Financial & Liquidity Risks	Substantial working capital required for operations; delays in collection from customers may stress liquidity. Fluctuations in interest rates and currency (for export turnover) add further risk. The company is newly public and does not have an established track record in public equity markets.	Prudent working capital management, credit assessment of customers, hedging policies for forex, and careful financial planning.
Technology & Strategic Risks	The adoption of technology in collection, production, and marketing is necessary for competitive advantage. Delays or inability to adapt to digital disruptions (including e-commerce and online consumer engagement) may impact market share.	Investment in ERP, use of modern marketing tools, e-commerce partnerships, and digital sales channel expansion.
Brand & Reputation Risks	Quality lapses, counterfeiting, or design plagiarism can harm the companys reputation. Any negative publicity or product recall can disproportionately impact growth as a premium market player.	Strict quality control, legal protection for IP/designs, brand building efforts, and customer service focus.
Human Resource Risks	Dependence on skilled designers, production staff, and management. Attrition, talent shortages, or disputes may hamper growth and product innovation.	Attractive employee programs, ongoing skill development, succession planning, and favorable working conditions.
Legal & Litigation Risks	Potential exposure to litigation involving contracts, intellectual property, employment, taxation, or third-party claims. Any adverse outcome could impact financials or business continuity.	Active legal review of contracts, insurance cover, prompt dispute resolution, and robust documentation practices.
External Environmental Risks	Uncertainties arising from pandemics, natural disasters, and geopolitical events that may disrupt supply chain, demand, or operations.	Business continuity planning, diversified logistics, and scenario-based risk assessments.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS

At Signoria Creation Limited, employees are recognized as the most valuable asset and central to the companys ongoing success. Human capital is viewed as the core business driver, shaping not just operational excellence, but also the very soul and competitive edge of the organization to achieve sustainable growth. The companys culture is anchored in fostering a strong people-centric environment, where every colleague regardless of hierarchy is integral to the overall growth strategy and empowered to make business decisions. Signoria Creation is committed to supporting its people far beyond conventional compensation, offering best-in-class learning, robust career advancement, and rich developmental opportunities. Talent care and development, empowerment and participative decision-making, along with an emphasis on innovation, agility, and digital transformation, are the foundational principles of this approach. The organization acknowledges that internal selection and structured succession planning are crucial for its long-term viability, corporate culture continuity, and the advancement of its knowledge base. As a result, internal talent is continuously groomed for future leadership and greater responsibilities, fueling both retention and ambition. As of 31st March, 2025, the company proudly reports 26 permanent employees on its payroll.

INFORMATION & TECHNOLOGY

Driven by its continuous pursuit of growth and operational excellence, Signoria Creation Limited consistently upgrades and fortifies its information technology backbone. The companys commitment to expansion is reflected in the ongoing modernization of its digital infrastructure, ensuring that technology remains a key enabler of business efficiency and innovation. All core systems and processes across the organization have been seamlessly unified and customized through the deployment of robust, integrated software platforms. This harmonized IT environment enhances real-time data access, supports agile decision-making, and strengthens process controls providing a solid foundation for scalability and sustained competitive advantage as the company evolves.

CAUTIONARY STATEMENT

Statements in this report on Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable securities laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and domestic demand supply conditions, finished goods prices, raw material cost and availability, changes in Government regulations, tax regimes, economic developments within India and other factors such as litigation and industrial relations. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent developments, information or events.