Swasti Vinayaka Synthetics Ltd Management Discussions

I. INDUSTRY STRUCTURE AND DEVELOPMENTS:

The textiles and apparel industry in India has strengths across the entire value chain from fiber, yarn, fabric to apparel. The Indian textile and apparel industry is highly diversified with a wide range of segments ranging from products of traditional handloom, handicrafts, wool, and silk products to the organized textile industry in India. The organized textile industry in India is characterized by the use of capital-intensive technology for the mass production of textile products and includes spinning, weaving, processing, and apparel manufacturing.

The textile and apparel industry is one of the leading segments of the Indian economy and the largest source of foreign exchange earnings in India.

The industry support by the government, the favorable Geo-political equations coupled with the resilience of Indian entrepreneurs will likely hold the Indian economy and the Textiles and Apparel sector in good stead.

II. OPPORTUNITIES AND THREATS:

The textile industry faces several challenges and exciting opportunities in todays times. One of the most significant challenges is the growing global competition, with an increasing number of countries entering this sector. This means that companies need to become better and more efficient to remain competitive. Additionally, there is a growing pressure to be more environmentally friendly and conduct business responsibly. In order to induce foreign investments in the Textile Industry in India, the government is framing policies that are supportive to the foreigner while entering the Indian market. The government has even allowed 100% FDI in the Textile sector under an automatic route. The government is further looking to invest the production-linked incentive scheme in man-made fiber and technical textiles over a period of 5 years.

III. SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE

In textiles, our product is very well accepted by our customers & we are in the process of increasing our customer portfolio.

IV. OUTLOOK

Your Companys future growth will be driven by multiple growth drivers. In the textile space, large opportunities in global textile and clothing markets are driving growth for us. Your Company will focus on its core strengths product segments. Its focus on building marketing & distribution foot-prints shall continue with renewed vigor during the coming year. On the whole, we are seeing new growth opportunities in advanced material division and the segment continues to grow at rapid pace.

V. RISKS AND CONCERNS

• Competition from cheaper imports: The textile industry faces competition from cheaper imports, especially from countries with lower labor costs.

• Lack of innovation: The textile industry has been slow to adopt new technologies and innovative processes, which has resulted in a decrease in competitiveness.

• Rising costs: The cost of raw materials, labor, and energy has been increasing, which has put pressure on the profit margins of textile companies.

• Changing consumer preferences: Consumers are shifting towards more sustainable and eco-friendly products, which is affecting the demand for traditional textile products.

• Highly fragmented: The unorganized sector and small and medium-sized businesses dominate Indias textile industry, which is highly fragmented.

• Outdated Technology: Due to market competition and access issues, the Indian textile sector struggles to keep up with international standards. This is especially true of small-scale businesses.

The Companys risk management framework encompasses strategy and operations and seeks to proactively identify, address and mitigate existing and emerging risks. The risk management framework goes beyond traditional boundaries and seeks to involve all our key managers.

VI. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The existing internal controls are adequate and commensurate with the nature, size, complexity of the Business and its Processes. During the year the Company has laid down the framework for ensuring adequate internal controls and to ensure its effectiveness, necessary steps were taken by the Company.

VII. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Your Companys total textile sales registered a growth, resulting in revenue from operations being Rs. 383806 thousand for the financial year ended on March 31, 2025 as against Rs 306561 thousand in preceding financial year and profit after tax was recorded at Rs. 24232 thousand in the current year as against Rs. 19753 thousand in the previous financial year.

VIII. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/ INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER OF PEOPLE EMPLOYED:

Your Company believes that its employees are one of the most valuable assets of the Company. The employees are deeply committed to the growth of the Company. With the growing requirements of the Company, Company has taken necessary initiatives to ensure not only the retention of the employees but also their growth and development.

The Company also provides various opportunities to the employees to develop their skills to take up higher responsibilities in the organization. Company also uses various communication channels to seek employees feedback about the overall working environment and the necessary tools and resources they need to perform at their best potential.

Number of people employed in Company are 10

IX. KEY FINANCIAL RATIOS:

X. DISCLOSURE OF ACCOUNTING TREATMENT:

In the preparation of financial statements, a treatment different from that prescribed In an Accounting Standard has not been followed; thus, managements explanation is not required.

Forward Looking Statements

Statement in the 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 and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include raw material availability and prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries in which the Company conducts.