Suryalata Spinning Mills Ltd Management Discussions

Suryalata Spinning Mills Limited (the Company) is a public limited company incorporated on 23^rd May, 1983, having experienced in manufacturing Synthetic Blended Yarns and proved as Quality Producer. Its Registered office situated at 105, S P Road. Surya Towers,1^st Floor, Secunderabad, Telangana State. The company is listed on the Bombay Stock Exchange.

The company is engaged in producing the best quality Synthetic Blended Yarns and it is one of the largest producers of Ring Spun Yarns i.e 100% PSF Yarns, 100% VSF Yarns, P/V blended yarns and value-added Yarns like Slub yarns, Elite Twist, Sairo Yarns, Compact Yarns and T F O (two for one twister) Yarns etc., counts ranging from 10s to 60s. The company also producing Vortex Yarns. The company is having two manufacturing units at Kalwakurthy and Urukondapet, on Kalwakurthy — Jadcherla Road in Nagerkurnool District, Telangana, only an hour away from the Hyderabad International Airport and the distance between the two units is 5 Kms. The Company is having total installed capacity of 1,19,280 spindles and 8 Nos Vortex Spin machines. Altogether produces the quantity about 90 MTs per day. The units are maintaining standard operational system and certification of "ISO 9001:2015".

The company sells its finished goods (Yarn) to various dealers located in the Indian domestic market as well as in the International market.

The Global economy in 2024 proved unexpectedly steady growing at 3.3%, only a shade below the 3.5% posted earlier, despite persistent noise and disruption. According to the International Monetary Fund, resilence held firm against an unsettled backdrop of inflationary pressure, geopolitical fault lines and fragmenting trade ties. The United States, driven by buoyant consumer and government spending, led the developed world with GDP growth of 2.8%.

Geopolitical tensions now more durable than episodic compounded market uncertainity. A more fragmented world economy shaped by competing spheres of influence and rising trade friction, added further complexity. Now tariffs and retaliatory measures risk pulling global trade volumes into contradictory territory.

Encouragingly, recent bilateral trade deals suggest that diplomacy is not entirely off the table. Further, monetary easing and subsiding inflation offer some tailwinds, yet not all signals were inflation easing.

The Global Textile Market size is estimated at USD 774.33 billion in 2025, and is expected to reach USD 920.55 billion by 2030, at a CAGR of 3.52% during the forecast period (2025-2030). Source: https://www.mordorintelligence . com/industry-reports/global-textile-industry—growth-trends-and-forecast-2019—2024. Amidst unwinding supply side issues and restrictive monitory policy, inflation is declining faster than expected across most regions.

6. Standard Bidding Guidelines for tariff based competitive bidding process for procurement of Power from Grid Connected Solar PV and Wind Projects.

7. Government has issued orders that power shall be dispatched against Letter of Credit (LC) or advance payment to ensure timely payment by distribution licensees to RE generators.

Now, India achieves 50% clean energy milestone five years ahead of 2030 target as India installed 242.8 GW of Clean Energy, which solar energy accounts for nearly half of the renewable capacity i.e 111 GW as of May 2025. The country has set an ambitious target to achieve 500 GW renewable energy by 2030.

Considering the importance giving by the Indian Government and the available State Government guidelines of the Solar Policy, the company installed Solar Power Plants about 15 MW within the manufacturing units for Captive consumption of power generations. These installed capacities mitigate 30% of the company annual power requirements and it reduces the dependence on DISCOM power supplies. The average cost of power from operating of these plants will be about Rs.2.20 per unit, thereby the company able to reduce the average unit cost of power. The company also proposed to install further capacities with in the manufacturing units towards Cost Reduction Techniques in the coming years. The company also has a state-of-the-art Sewage Treatment Plants in both the units whereby 95% of the water used in the factories is purified and recycled.

Further, the 100% Subsidiary company namely Suntree Solar Energy Pvt Ltd, having 10 MW AC Capacity Solar Power Plant with Power Purchase Agreement for 20 years (remaining period of 11 years) with Telangana Government, installed in 64 acres of land in the state of Telangana.

The company had installed proven technology of Vortex Spin equipments and the Yarn produced with this technology proved its quality and also in quantum for a decision to expand this Yarn product volumes. Presently installed 8 Nos. Vortex Spin equipment equivalent to 12000 Ring Spindles, Having created infrastructure to increase the capacities upto the equivalent of 30000 Ring Spindles in the coming years, further the installation of 8 Vortex machines are in the process in the Financial Year 2025-26.

Suryalata holding on hand opportunities to strengthen its position with --

(a) Availability of advanced technology equipment.

(b) Experienced management team.

(c) Emphasis on Quality Products

(d) Timely deliveries to Customers.

(e) Long standing Customer Relations

(f) Simple and Strategic market potentiality.

(g) Rich resources of raw materials like PSF.VSF, Silk and Cotton.

The Company estimates the Threats to Synthetic Industry such as

a) Significant changes in raw cotton prices effects to Synthetic Fiber prices .

b) Losgistic costs are adversely affecting its ability to compete in exports.

c) High power costs and High Interest costs are burdened for this Thin margin industry.

d) Long export lead times are eroding India?s export competitiveness across the textile chain.

d) Currency fluctuations are highly affecting the synthetic spinning industry.

e) Profitability undermined with inflation and causing to raise wages

f) Fierce competition stressed by e-commerce activities

g) Changing consumer behavior (e.g. fast fashion).

Risks are integral part of the growth of a business. However, the Company frames the effective risk management which helps to mitigate the risks effectively and ensures business sustainability.

Effective risk management comprises the,

i) Standard policy to pass the cost increases with its premium quality.

ii) Consciously up-keep of equipment and implementing the cost control methods,

iii) Strengthen and widen the customer base with timely supplies.

iv) Change into high count patterns which support high contributions

Synthetic Yarn Products are expected to grow at significant rate over the coming years. The growth can be attributed to its beneficial properties such as high strength, chemical & wrinkle resistance, quick drying etc., are towards personal care and hygiene applications. It is also used in households as cushioning & insulating material in pillows and in industries for making carpets, Tyres, air filters, coated fabrics and other products.

Also the fashion segment dominated the market owing to the increasing consumer spending on clothing and apparel. In addition, high consumer requirements for crease-free suiting & shirting fabrics and quality dyed & printed fabrics are likely to drive and to increase the demand for Synthetic products.

Considering all these present applications and forecasting the future requirement of Synthetic Yarn Products, the company focused on technically proved Vortex Yarns to have new product in the basket, increase the volumes, improve the margins and to strengthen the financial position.

The Company has a well-established framework of internal controls in all areas of its operations, including suitable monitoring procedures and competent personnel. In addition to statutory audit, the financial controls of the Company at various locations are reviewed by the Internal Auditors, who report their findings to the Audit Committee of the Board. The Audit Committee is headed by an Independent Director and this ensures independence of functions and transparency of the process of supervision. The Committee meets to review the progress of the internal audit initiatives, significant audit observations and planning and implementation of follow-up action required. The Company conducts its business with integrity and high standard of ethical behavior and in compliance with the laws and regulations that govern its business.

The Standalone performance of the company increased in Volumes as well in Values of Net turnover for the Financial Year 2024-25 to Rs.491.06 crores as compared to previous year 445.51 crore, despite resilence, uncertainity, trade friction in the fragmented world economy. Product volumes increase to 31,016 MTs as against 29,109 MTs in previous year.

Your Company has earned a Consolidated Profit Before Tax Rs. 18.90 crore in comparison to Rs.24.34 crore in the previous year due to price stress in the sluggish market and subdued market conditions. Consolidated Profit after tax is Rs.15.37 crore as against Rs.18.65 crore in the previous year.

The Company firmly believes that Human Resource Development strategies and practices will continue to provide a sustained competitive advantage and will continuously work towards nurturing and enhancing a competitively superior position in terms of human capital, people processes and employees behavior.

There were no material developments in the Human resources. The industrial relations were generally found satisfactory.

During the period under review, the total number of people employed by the Company is 1,450 in addition to indirect employment created.

The company formulated CSR policy to touch and transform people?s lives by promoting health care, education including special education among children and employment opportunities for women, providing malnutrition, sanitation and drinking water, animal welfare etc,.

During the year Suryalata has continued to educate Vedic students thru Vedic Pathasala, in the form of contributions to provide Food & Sanitization for Old Age people to enhance their health in the society.

The statement and views expressed by the management in the above said report are on the basis of best judgment but the actual results might differ from whatever stated in the report. The Company takes no responsibility for any consequence of decisions made based on such statements and holds no obligation to update these in future. Readers are cautioned not to place undue reliance on these forward-looking statements.