Sri Ramakrishna Mills Coimbatore Ltd Management Discussions

The management of Sri Ramakrishna Mills (CBE) Limited has reviewed the Companys performance and key business developments for the financial year ended March 31, 2026, and shared its perspective on the road ahead. The outlook reflects the current economic environment and business landscape, though future developments, both domestic and global, across economic, social, and political may influence actual outcomes.

REVIEW OF ECONOMY Global Economic Overview:

While the global economy has generally avoided severe downturns, it faces structural hurdles. The ongoing conflict in the Middle East has pressured energy supply chains and elevated shipping freight and insurance costs. Overall, the global outlook remains uncertain due to geopolitical developments which continue to pose risks to sustained economic growth.

Indian Economy Overview:

In a global environment marked by shifting trade dynamics and uneven recovery across major economies, India has reinforced its position as the fastest-growing major economy while maintaining relative macroeconomic stability. Despite the shift in global rankings, India will remain the fastest- growing major economy, according to IMF estimates.

REVIEW OF TEXTILE INDUSTRY

Indias textile sector is poised for significant growth, driven by a global shift in sourcing away from China and a cyclical recovery in demand. Experts highlight that geopolitical risks and rising costs are pushing brands to diversify, creating a multi-year opportunity for India. Proposed free trade agreements with the UK, EU, Australia and New Zealand are expected to further boost competitiveness, making Indian exporters more attractive.

Opportunities and Threats OPPORTUNITIES:

Indias textile industry is seeing a comeback as uncertainty over US tariffs has ended. Global demand is getting better. This brings new hope for the sector with improved industry fundamentals. Demand is becoming clearer and new trade agreements are strengthening Indias global position. Indias textile exports are set for a significant boost following the end of the Iran war. Manufacturers anticipate lower raw material costs for polyester and cotton. This development will help revive shipments to Europe and West Asia. The easing of tensions will also allow India to better utilize its trade agreements.

THREATS:

The Company is exposed to various risks which include factors such as rising competition in the market on the domestic and export fronts, duty free access to competing countries in US and European markets, uncertain business environment. In the last few years, rising cotton prices - both domestic and international have led to a narrowing spread between yarn and fiber prices. This has severely compressed gross margins, leaving Indian spinning mills with little buffer to sustain profitability. The Company tries to mitigate these risks by taking quick actions and proactive initiatives to minimize the impact of these risks to the extent possible.

Internal Controls

The Company has adequate internal control system to monitor internal business process, financial reporting and compliance with applicable laws. The adequacy and effectiveness of the control systems are being reviewed periodically to see that it conforms to the policies and procedures adopted by the company so as to meet the statutory requirements. The Audit Committee at its meetings regularly reviewed the significant observations of the compliance and other reports.

Human Resources Management

Necessary initiatives have been taken for improving the skills of the employees by providing training with regard to development of its human resources.

Review by Audit Committee

The Management Discussion and Analysis are placed before the Audit Committee and duly reviewed by the Committee.

Financial Results

SEBI has mandated under SEBI (LO & DR) Regulations 2015 amendment that the Annual Report for the year ended 31.03.2026 should contain the following ratios for the year and also for the previous year with explanation where the variation is more than 25%

Particulars	Unit of Measurement	March 31, 2026	March 31, 2025	Variation in %	Reason for Variance
Current Ratio	In multiple	1.78	0.92	93.48%	Variance in Current Ratio is due to increase in current assets during the year in comparison to previous year.
Debt- Equity Ratio	In multiple	0.72	0.27	166.67%	Variance on Debt-equity ratio is due to repayment of non current liability during the year.
Debt Service Coverage Ratio	In multiple	5.07	1.03	392.23%	Variance in Debt-Service coverage ratio is due to increase in current assets during the year in comparison to previous year
Return on Equity (ROE)	In %	386%	51.25%	652.55%	Variance in Return on Equity ratio is due to increase in profits during the year in comparison to previous year
Net Profit Ratio	In %	28.02%	5.48%	411.31%	Variance in Net Profit Ratio is due to increase in profits during the year in comparison to previous year.
Return on Capital Employed	In %	76.97%	25.68%	199.73%	Variance in Return on Capital Employed ratio is due to increase in profits during the year in comparison to previous year.
Return on investment	In %	32.13%	5.29%	507.37%	Variance in Return on investment ratio is due to increase in profits during the year in comparison to previous year.

	For and on behalf of the Board of Directors of Sri Ramakrishna Mills (Coimbatore) Limited
	D. LAKSHMINARAYANASWAMY
Place : Coimbatore	Managing Director
Date : 29.05.2026	(DIN : 00028118)