Super Fine Knitters Ltd Management Discussions

The Management Discussion and Analysis (MD&A) Report provides an overview of Super Fine Knitters Limiteds ("the Company") operational environment, prevailing industry dynamics, key strategic initiatives, financial performance, and future outlook for the financial year ended March 31, 2026.

ECONOMIC AND BUSINESS ENVIRONMENT

GLOBAL ECONOMY

The global textile and apparel industry continued to operate in an environment characterised by evolving consumer demand, fluctuations in input costs and trade-related challenges during FY 2025- 26. Against this backdrop, Indias textile and apparel sector demonstrated resilience, with exports of textiles and apparel, including handicrafts, reaching Rs 3,25,339 crore during FY 2025-26, compared with Rs 3,19,573.2 crore in FY 2024-25, representing growth of 1.8%. The sector recorded export growth across more than 100 destinations during the year. (Ministry of Textiles, Government of India / PIB, 21 July 2026).

INDIAN ECONOMY

Indias textile and apparel exports, including handicrafts, have also shown sustained growth over the medium term, increasing from Rs 2,97,004 crore in FY 2023-24 to Rs 3,25,339 crore in FY 2025-26, representing a CAGR of approximately 4.7%. Ready-made garments remained the largest export category at Rs 1,39,350 crore in FY 2025-26, while cotton textiles and man-made textiles contributed Rs 1,02,427 crore and Rs 46,254 crore, respectively. (Ministry of Textiles, Government of India / PIB, 28 July 2026; DGCIS provisional data)

INDUSTRY STRUCTURE

EXPORT AND INTERNATIONAL MARKET ENVIRONMENT

The international market environment remains relevant to the Indian textile and apparel sector. Indias textile and apparel exports, including handicrafts, reached Rs 3,25,339 crore in FY 2025-26, with growth recorded across more than 100 export destinations. This indicates continued international demand for Indian textile and apparel products.

(Ministry of Textiles, Government of India / PIB; DGCIS provisional data.)

For FY 2025-26, ready-made garments remained Indias largest textile and apparel export category, with exports of Rs 1,39,350 crore. Cotton textiles accounted for Rs 1,02,427 crore and man-made textiles accounted for Rs 46,254 crore. The performance of these categories remains relevant to the broader market environment in which manufacturers of knitted fabrics and garments operate. (Ministry of Textiles, Government of India / PIB; DGCIS provisional data.)

INDIAN MARKET OVERVIEW

The Indian textile and apparel industry remains an important manufacturing and export sector, supported by an established textile value chain and a diversified product base. During FY 2025-26, Indias textile and apparel exports excluding handicrafts amounted to Rs 3,09,484 crore, while exports including handicrafts stood at Rs 3,25,339 crore. The data indicates continued demand for Indian textile products across international markets despite fluctuations in global demand and input costs. (Ministry of Textiles, Government of India / PIB; DGCIS provisional data)

Indias textile and apparel exports recorded growth in more than 100 countries during FY 2025-26. Among the major markets, exports including handicrafts to the United Kingdom increased to Rs 19,652 crore, Germany to Rs 13,200 crore, the Netherlands to Rs 10,461 crore, Spain to Rs 9,651 crore, France to Rs 9,074 crore and Italy to Rs 7,407 crore. Exports to the United States stood at Rs 85,910 crore. (Ministry of Textiles, Government of India / PIB; DGCIS provisional data)

The policy environment for the sector continues to focus on enhancing manufacturing capabilities, value addition and export competitiveness. Government initiatives include the PM Mega Integrated Textile Regions and Apparel Parks (PM MITRA) Scheme, Production Linked Incentive (PLI) Scheme for Textiles, National Technical Textiles Mission, SAMARTFI, RoSCTL, RoDTEP, Export Promotion Mission and the Credit Guarantee Scheme for Exporters. (Ministry of Textiles, Government of India / PIB, 21 July and 28 July 2026)

COMPANY OVERVIEW & ROLE

Super Fine Knitters Limited is engaged in the business of manufacturing knitted fabrics and garments., which remains competitive yet promising, given Indias cost advantages, skilled workforce, and government initiatives such as PLI schemes, GST rationalisation, and export incentives. The Company is a supplier of knitting fabrics to large export companies involved in manufacturing knitted garments in India and supplies fabrics and garments to national and international brands.

The Companys product and manufacturing profile includes knitted fabrics ranging from 100% cotton to cotton Lycra, mercerized to plain and washed to overdyed and other blended fabrics. The outlook for the textile industry remains positive in the medium to long term, supported by strong domestic consumption, rising exports, and increasing demand for sustainable and quality fabrics. The Company aims to strengthen its presence in markets through product diversification, capacity enhancement, and customer-focused strategies.

The Company also has a laboratory equipped for testing and uses fabric dyeing houses under contract. FINANCIAL ANALYSIS (ON STANDALONE BASIS):

Revenue Break - up:

(INR. in lakh)

Particulars	2025-26	% to Total Income	2024-25	% to Total Income
Revenue	3095.86	98.42	2817.94	98.43
Other Income	49.61	1.58	44.96	1.57
Total Turnover	3145.47	100	2862.90	100

Profitability/Losses:

Particulars	2025-26	2024-25
Profit/losses before depreciation and tax	151.37	186.12
Depreciation	98.23	94.90
Profit/losses before tax	53.14	91.22
Tax (Previous year)	(48.85)	23.73
Profit/losses after Tax	91.83	67.49

The increase in sales from Rs 281.79 million to Rs 309.59 million represents growth of approximately 9.86%. Net income increased by approximately 36.0% over the corresponding period. Basic earnings per share from continuing operations increased from Rs 0.54 in FY 2024-25 to Rs 0.74 in FY 2025-26.

OPPORTUNITIES & RISKS OPPORTUNITIES

• Growing Export Opportunities: Continued growth in Indias textile and apparel exports, with exports reaching Rs 3,25,339 crore in FY 2025-26 and growth recorded across more than 100 destinations, presents opportunities for manufacturers across the domestic and international textile value chain. (Ministry of Textiles, Government of India / PIB)

• Government Policy Support: Government initiatives focused on integrated textile infrastructure, manufacturing competitiveness, technical textiles, skill development and export promotion provide a supportive policy environment for the sector.

• Key Government Schemes: Initiatives including PM MITRA, PLI for Textiles, National Technical Textiles Mission and SAMARTH are aimed at strengthening manufacturing capabilities and enhancing competitiveness across the textile value chain. (Ministry of Textiles, Government of India / PIB)

• Companys Product Portfolio: The Companys established presence in knitted fabrics and garments provides a platform to participate in the broader growth opportunities emerging across the textile and apparel sector.

THREATS:

• Volatility in raw material prices (cotton, yarn, dyes).

• Intense domestic and international competition.

• Global economic uncertainties and changing trade policies.

• Rising labour and compliance costs.

RISKS 8i CHALLENGES

• Global Demand Volatility: The textile and apparel sector remains exposed to fluctuations in global demand, which may influence market conditions and business opportunities. (Ministry of Textiles, Government of India / PIB, 21 July 2026.)

• Input Cost Volatility: Variations in raw-material and other input costs may impact the economics and profitability of textile manufacturing, requiring continued cost and operational discipline. (Ministry of Textiles, Government of India / PIB.)

• Trade and Geopolitical Developments: Changes in international trade policies, tariffs and geopolitical conditions may influence export opportunities and market access.

• International Market Exposure: Indias textile and apparel exports are spread across major markets including the United States, United Kingdom, UAE, Germany, Netherlands, Spain,

France and Italy. Changes in demand or trade conditions in these markets may affect the broader industry outlook. (Ministry of Textiles, Government of India / PIB; DGCIS provisional data.)

• Competitive Environment: Increasing competition in domestic and international textile markets may require manufacturers to maintain product quality, cost efficiency and responsiveness to changing customer requirements.

STRATEGIC OUTLOOK

The Companys stated presence in knitted fabrics and garments provides alignment with the broader textile and apparel value chain. The Company has indicated its objective of strengthening its position as a manufacturer and exporter of knitted fabrics and garments to enhance competitiveness through digitalization and process automation. Focus on high-margin niche products and sustainable fabrics. Strengthen global reach by aligning with ESG-focused international retailers. Maintain financial prudence while pursuing growth opportunities under government-backed textile reforms.

ADEQUACY OF INTERNAL CONTROL SYSTEMS

The Company has established a robust internal control framework designed to ensure:

• Accuracy and reliability of financial reporting.

• Compliance with applicable laws, regulations, and internal policies.

• Safeguarding of assets against unauthorized use or losses.

• Efficient operations through standardized processes and accountability.

The internal control systems are commensurate with the size and nature of the Companys business operations. These controls are reviewed periodically by management, and any deviations are promptly addressed. An independent Internal Audit team, reporting directly to the Audit Committee of the Board, evaluates the adequacy and effectiveness of internal controls across various functions. The Audit Committee regularly reviews audit findings and monitors the implementation of recommendations. This process ensures a culture of continuous improvement and strengthens the governance framework. The Company also leverages technology-enabled monitoring tools and automation in processes to enhance transparency, reduce operational risks, and improve overall efficiency.

SIGNIFICANT KEY FINANCIAL RATIOS

Particulars	FY 2025-26	FY 2024-25
1 Current Ratio (in Times)	7.05	8.13
2 Debt-Equity Ratio (in Times)	0.42	0.49
3 Return on Equity Ratio (in %)	3.74%	2.86%
4 Trade Receivable turnover Ratio (In Times)	10.94	5.77
5 Net Capital Turnover Ratio (In Times)	1.28	1.13
6 Net Profit Ratio (In %)	2.94%	3.24%

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/INDUSTRIAL RELATIONS:

The Company considers its people to be an important enabler of sustainable business performance. It remains focused on fostering a skilled, motivated and engaged workforce through appropriate learning and development initiatives, with emphasis on technical capabilities, functional skills and leadership development. Training and capability-building initiatives are undertaken to align employee competencies with evolving business requirements, industry practices and technological developments.

The Company places due emphasis on employee welfare, workplace health and safety, professional development and an inclusive work environment. Performance management practices are aligned with organisational objectives and seek to encourage accountability, merit and continuous improvement.

Industrial relations during the year remained harmonious and cordial. The Company continues to promote a work culture based on collaboration, transparency and mutual respect. The management acknowledges and appreciates the commitment and contribution of its employees towards the Companys operations and continued growth.

CAUTIONARY STATEMENT

This Management Discussion and Analysis contains statements concerning the Companys business, financial performance, industry environment and outlook. Certain statements relating to future expectations, opportunities and risks may constitute forward-looking statements. Such statements are based on information available as of the date of this report and are subject to risks and uncertainties. Actual results may differ materially from those expressed or implied due to changes in economic conditions, market demand, input costs, trade policies, competition, regulatory developments and other factors.

The Company assumes no responsibility to publicly amend, modify, or revise any forward-looking statements on the basis of subsequent developments, information, or events, except as required under applicable laws.

	For and on behalf of the Board Super Fine Knitters Limited
	SD/-	SD/-
Place: Ludhiana	Ajit Kumar Lakra	Vivek Lakra
Date: 07th September, 2026	Managing Director	Whole Time Director
	DIN: 01067195	DIN:01067219