Vama Wovenfab Ltd Management Discussions

A As certified by M/s B.M. Gattani & Co. Chartered Accountants vide their certificate dated June 17, 2026 Notes:

(1) Revenue from Operations means the Revenue from Operations as appearing in the Restated Financial Statements.

(2) Number of Customers means the customer from whom we have generated the revenue during the period.

(3) Average Revenue per customer is calculated as Revenue from operations divided by Number of Customers.

(4) Employee Benefit Cost includes the all expenses related to employees as appearing in the Restated Financial Statements.

(5) Total Annual Manpower is the average count of employees engaged during the year.

(6) Average Annual Manpower Cost is calculated as Employee Benefit Cost divided by Total Annual Manpower.

Our Company was initially incorporated as a private company in the name of "Vama Wovenfab Private Limited" on March 16, 2011, under the provisions of Companies Act 1956 bearing Corporate Identification Number U18109MH2011PTC214860 issued by Registrar of Companies Maharashtra, Mumbai. Subsequently, our Company was converted into Public Limited Company pursuant to Shareholders resolution passed at the Extraordinary General Meeting

of our Company held on July 28, 2025, and the name of our Company was changed to "Varna Wovenfab Limited" and a Fresh Certificate of Incorporation consequent upon conversion of Company to Public Limited dated August 21, 2025 was issued by the Registrar of Companies, Central Processing Centre. The Corporate Identification Number of the Company is U18109MH2011PLC214860.

The Company is engaged in the manufacturing of woven fabric and textile products, specializing in the production of a wide range of woven packaging materials. The companys product portfolio includes woven sacks, bags, and other textile - based packaging solutions, which are widely used in various sectors such as agriculture, food processing, construction, and industrial packaging. VAMA WOVENFAB PRIVATE LIMITED is committed to delivering high-quality, durable, and reliable products that meet stringent industry standards. The company employs advanced manufacturing processes and quality control measures to ensure that only flawless products reach the market.

The company has manufacturing facility at Survey No. 162/4, 6, 7, 9, Coastal Highway, Bhimpore, Daman - 396210 (Union Territory), India. The registered office of the company is located at B/401, Royal Accord, Yogi Nagar, Borivali (W), Mumbai, Maharashtra, India, 400091 and books of accounts maintained at the registered office.

1.2 Basis of preparation of financial statements

The financial statements have been prepared and presented under the historical cost convention on accrual basis of accounting and in accordance with the Generally Accepted Accounting Principles (GAAP) in India. GAAP includes Accounting Standards (AS) noticed by the Government of India under Section 133 of the Companies Act, 2013, provisions of the Companies Act, 2013, pronouncements of Institute of Chartered Accountants of India and guidelines issued by Securities and Exchange Board of India (SEBI). The Company has presented standalone financial statements as per format prescribed by Revised Schedule III, notified under the Companies Act, 2013, issued by Ministry of Corporate Affairs. Except where otherwise stated, the accounting policies are consistently applied.

These Restated Financial Statement have been prepared specifically for inclusion in the Red Herring Prospectus ("RHP") and the Prospectus (Prospectus and together with RHP, the "Issue Documents") to be filed by the Company with the SME Platform of BSE Limited (BSE SME) in connection with proposed initial public offer of fresh issue of its equity shares, in accordance with the requirements of: a. Section 26 of Part I of Chapter III of the Companies Act, 2013; b. Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended (the "SEBI ICDR Regulations") as issued by the Securities and Exchange Board of India ("SEBI") on 11th September 2018 as amended from time to time in pursuance of the Securities and Exchange Board of India Act, 1992; and c. Guidance Note on Reports in Company Prospectus (Revised 2019) as issued by the Institute of Chartered Accountants of India ("ICAI").

The financial statements are presented in Indian Rupees in Lakhs (INR in Lakhs) and all values are rounded off to nearest rupee in lakhs except otherwise stated.

1.3 Financial Statements: Presentation and disclosures

Financial Statements contain the information and disclosures mandated by Revised Schedule III, applicable accounting standards, other applicable pronouncements and regulations.

All assets and liabilities have been classified as current or non-current as per the Companys normal operating cycle and other criteria set out in the Schedule III to the Companies Act, 2013. Based on the nature of Services and the time between the provision of services and the realization of the revenue in cash and cash equivalents, the Company has ascertained its operating cycle as 12 months for the purpose of current, non- current, classification of assets and liabilities.

1.4 Use of Estimates

The preparation of financial statements is in conformity with generally accepted accounting principles which require management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amount of assets and liabilities, income and expenses and the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates. Estimates and assumptions are reviewed on an ongoing basis. Any revision to accounting estimates is recognized prospectively in current and future periods.

1.5 Property, Plant & Equipment and Depreciation

(a) Property, Plant and Equipment are stated at cost less accumulated depreciation. The cost of fixed asset includes nonrefundable taxes & levies, freight and other incidental expenses related to the acquisition and installation of the respective assets. Borrowing cost attributable to acquisition or construction of qualifying fixed assets is capitalized to respective assets when the time taken to put the assets to use is substantial.

(b) Pre-operative expenditure comprising of revenue expenses incurred in connection with project implementation during the period upto commencement of commercial production are treated as part of project costs and are capitalized. Such expenses are capitalized only if the project to which they relate, involve substantial expansion of capacity or upgradation.

(c) Depreciation on fixed assets is provided on straight line method on the basis of the useful life prescribed in Schedule II of the Companies Act, 2013 or based on useful life of the asset as estimated by the management, whichever is higher.

(d) Cost of leasehold land (except for lease of long tenure) is amortized over the period of the lease. Cost of lease hold land where lease period is of long tenure and substantial rights of ownership are with lessee, is not amortized

1.6 Impairment of Assets

The carrying amounts of the assets are reviewed at each Balance Sheet date. An asset is treated as impaired when the carrying cost of the asset exceeds its recoverable value. An impairment loss is charged when the asset is identified as impaired.

The reversal of impairment loss is made as per generally accepted accounting principles.

1.7 Revenue Recognition

(a) Revenue from sale of goods is recognized when the significant risks and rewards of ownership of goods are transferred to the customer. Sales are net of discounts, Goods and Service Tax and estimated returns. Excise duties collected on sales are shown by way of deduction from sales.

(b) Provision for sales returns are estimated primarily on the basis of historical experience, market conditions and specific contractual terms and provided for in the year of sale as reduction from revenue. The methodology and assumptions used to estimate returns are monitored and adjusted regularly in line with contractual and legal obligations, trade practices, historical trends, past experience and projected market conditions.

(c) Income from services is recognized when the services are rendered or when contracted milestones have been achieved.

(d) Revenue from arrangements which includes performance of obligations is recognized in the period in which related performance obligations are completed.

(e) Export entitlements are recognized as income when right to receive credit as per the terms of the scheme is established in respect of the exports made and where there is no significant uncertainty regarding the ultimate collection of the relevant export proceeds.

(f) Dividend income is recognized when the right to receive dividend is established.

(g) Interest income is recognized using the time-proportion method, based on rates implicit in the transaction.

(h) Revenue in respect of other income is recognized when a reasonable certainty as to its realization exists.

1.8 Current and Non-Current Classification

The Company presents assets and liabilities in the Balance Sheet based on current/ non-current classification. An asset is treated as current when it is:

i) Expected to be realized or intended to be sold or consumed in normal operating cycle

ii) Held primarily for the purpose of trading

iii) Expected to be realized within twelve months after the reporting period, or

iv) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.

All other assets are classified as non-current.

A liability is current when:

i) It is expected to be settled in normal operating cycle

ii) It is held primarily for the purpose of trading

iii) It is due to be settled within twelve months after the reporting period, or

iv) There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

The Company classifies all other liabilities as non-current.

Long-term benefits: a) Defined Contribution Plan

The Company contributes to a recognized provident fund for all its employees. Contributions are recognized as an expense when employees have rendered services entitling them to such benefits.

b) Gratuity

The Company provides for its gratuity liability based on actuarial valuation as at the balance sheet date which is carried out by an independent actuary using the Projected Unit Credit Method. Actuarial gains or losses arising from experience adjustments and changes in actuarial assumptions are credited or charged to Statement of Profit and Loss in the period in which such gains or losses arise.

1.9 Related Party Transaction

Disclosure of transactions with related parties and where control exists, as required by Accounting Standard 18 "Related Party Disclosure" has been set out in a Notes to the Financial Statement. Related parties as defined under clause 3 of the Accounting Standard have been identified based on representations made by key managerial personnel and information available with the Company. Refer Annexure XXXV

1.10 Disclosure of accounting Policies

The accounting policies have been disclosed to the extent applicable to the Company.

1.11 Accounting for Taxation:

Income Tax

Income Taxes are accounted for in accordance with Accounting Standard 22 on "Accounting for Taxes on Income". Taxes comprise both current and deferred tax. Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the company operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date.

Deferred Tax

Deferred income taxes reflect the impact of timing differences between taxable income and accounting income originating during the current year and reversal of timing differences for the earlier years. Deferred tax is measured using the tax rates and the tax laws enacted or substantively enacted at the reporting date. Deferred tax liabilities are recognized for all taxable timing differences. In situations where the company has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that they can be realized against future taxable profits. Deferred tax assets are recognized subject to prudence and only if there is reasonable certainty that they will be realized.

1.12 Earnings Per Share

Basic earnings per share are calculated by dividing the net profit for the year attributable to equity shareholders (after deducting preference dividends and attributable taxes) by the weighted-average number of equity shares outstanding during the year. The weighted-average number of equity shares outstanding during the year and for all years presented is adjusted for events such as bonus issue; bonus element in a rights issue to existing shareholders; share split; and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders and the weighted-average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

1.13 Leases

Where the company is lessee

Finance leases, which effectively transfer to the company substantially all the risks and benefits incidental to ownership of the leased item, are capitalized at the inception of the lease term at the lower of the fair value of the leased property and present value of minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized as finance costs in the statement of profit and loss. Lease management fees, legal charges and other initial direct costs of lease are capitalized.

A leased asset is depreciated on a straight-line basis over the useful life of the asset. However, if there is no reasonable certainty that the company will obtain the ownership by the end of the lease term, the capitalized asset is depreciated on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term. Leases, where the

lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the statement of profit and loss on a straight-line basis over the lease term.

Where the company is the lessor

Leases in which the company transfers substantially all the risks and benefits of ownership of the asset are classified as finance leases. Assets given under finance lease are recognized as a receivable at an amount equal to the net investment in the lease. After initial recognition, the company apportions lease rentals between the principal repayment and interest income so as to achieve a constant periodic rate of return on the net investment outstanding in respect of the finance lease. The interest income is recognized in the statement of profit and loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the statement of profit and loss.

Leases in which the company does not transfer substantially all the risks and benefits of ownership of the asset are classified as operating leases. Assets subject to operating leases are included in property, plant and equipment. Lease income on an operating lease is recognized in the statement of profit and loss on a straight-line basis over the lease term. Costs, including depreciation, are recognized as an expense in the statement of profit and loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognized immediately in the statement of profit and loss.

1.14 Borrowing costs

Borrowing cost includes interest and amortization of ancillary costs incurred in connection with the arrangement of borrowings.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective asset. All other borrowing costs are expensed in the period they occur.

1.15 Investments

Investments, which are readily realizable and intended to be held for not more than one year from the date on which such investments are made, are classified as current investments. All other investments are classified as long-term investments. On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties. If an investment is acquired, or partly acquired, by the issue of shares or other securities, the acquisition cost is the fair value of the securities issued. If an investment is acquired in exchange for another asset, the acquisition is determined by reference to the fair value of the asset given up or by reference to the fair value of the investment acquired, whichever is more clearly evident. Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. On disposal of an investment, the difference between its carrying amount and net disposal proceeds is charged or credited to the statement of profit and loss.

1.16 "Changes in Accounting Policies in the Period/Years Covered in The Restated Financial Statements"

There is no change in significant accounting policies adopted by the Company.

1.17 Other Notes on Restated Financial statements

The financial statements including financial information have been prepared after making such regroupings and adjustments, considered appropriate to comply with the same. As result of these regroupings and adjustments, the amount reported in the financial statements/ information may not necessarily be same as those appearing in the respective audited financial statements for the relevant years.

Contingent liabilities and commitments (to the extent not provided for) - A disclosure for a contingent liability is also made when there is a possible obligation that may, require an outflow of the Companys resources.

Figures have been rearranged and regrouped wherever practicable and considered necessary.

The management has confirmed that adequate provisions have been made for all the known and determined liabilities and the same is not in excess of the amounts reasonably required to be provided for.

The balances of trade payables, trade receivables, loans and advances are unsecured and considered as good are subject to confirmations of respective parties concerned.

Realizations: In the opinion of the Board and to the best of its knowledge and belief, the value on realization of current assets and loans and advances are approximately of the same value as stated.

Contractual liabilities: All other contractual liabilities connected with business operations of the Company have been appropriately provided for.

Amounts in the restated financial statements: Amounts in the restated standalone financial statements are rounded off to nearest Lakhs. Figures in brackets indicate negative values

1.18 Provisions

A provision is recognized when the company has a present obligation as a result of past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the reporting date. These estimates are reviewed at each reporting date and adjusted to reflect the current best estimates. Where the company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of profit and loss net of any reimbursement.

1.19 Contingent liabilities and Contingent Assets Contingent liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. Contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The company does not recognize a contingent liability but discloses its existence in the financial statements.

Contingent Assets

A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by- the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. The Company does not recognize the contingent asset in its financial statements since this may result in the recognition of income that may never be realised. Where an inflow of economic benefits are probable, the Group disclose a brief description of the nature of contingent assets at the end of the reporting period. And give disclosures as required by AS 29. However, when the realisation of income is virtually certain, then the related asset is not a contingent asset, and the Group recognize such assets. Contingent liabilities and contingent assets are reviewed at each Balance Sheet date.

1.20 Cash and cash equivalents

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in hand and short-term investments with an original maturity of three months or less.

1.21 Employee Benefits

"Short - term employee benefits are recognized as an expense at the undiscounted amount in the profit & loss account of the year in which the related service is rendered. Post-employment and other long term employee benefits are recognized as an expense in the profit & loss account for the year in which the liabilities are crystallized/accrued."

Provision for Gratuity has been considered as per Actuarial valuation report as per AS 15.

Employees who are eligible to receive benefits under the Employees Provident Fund, ESIC & Miscellaneous Provisions are defined contribution plan. Both the employee and the employer make monthly contributions as per the provisions of the act. The contribution to the provident fund, ESIC & any other fund is charged to the statement of profit and loss for the year when an employee renders the related services.

1.22 Inventory

Inventories are valued at the lower of cost and net realizable value. Provision for impairment is made when there is high uncertainty in salability of an item. The company follows First-in-First-Out (FIFO) method for valuation of inventory. Costs incurred in bringing inventories to its existing location and conditions are determined on the following basis:

(a) Raw materials and packing materials - Purchase cost of materials on moving average basis.

(b) Finished goods (manufactured) and work-in-progress - Cost of purchase, cost of conversion and other costs proportionately allocated determined on weighted average basis.

(c) Finished goods (traded) - Purchase cost on moving average basis.

1.23 Events After Balance Sheet Date

Events occurring after the Balance Sheet date that provide additional information materially affecting the determination of amounts relating to conditions existing at the Balance Sheet date are adjusted in the financial statements. Events which are material but pertain to conditions that arose after the Balance Sheet date are disclosed by way of notes.

The following are the explanation of financial data from our Financial Statements as Restated Balance Sheet for the financial years ended on March 31, 2025, 2024 and 2023:

Our Long-Term Borrowings decreased by Rs. 61.55 Lakhs from Rs. 305.57 Lakhs for the financial year ended March 31,2025 to Rs. 244.02 Lakhs for the financial year ended March 31,2026 representing a decrease of 20.14%, such decrease is on account of closure of Rupee GECL Loan from banks.

Our Short-Term Borrowings increased by Rs. 911.15 Lakhs from Rs. 1,388.77 Lakhs for the financial year ended March 31,2025 to Rs. 2,299.93 Lakhs for the financial year ended March 31,2026 representing a significant increase of 65.61% primarily due to increase in overdraft facility.

Our Trade Receivables decreased by Rs. 149.88 Lakhs from Rs. 1,991.53 Lakhs for the financial year ended March 31,2025 to Rs. 1,841.65 Lakhs for the financial year ended March 31,2026 representing a decrease of 7.53%, such nominal decrease is on account of a faster collection cycle from customers, supported by stronger receivables management and improved payment discipline.

Our Trade Payables decreased significantly by Rs. 1,528.06 Lakhs from Rs. 3,103.45 Lakhs for the financial year ended March 31,2025 to Rs. 1,575.38 Lakhs for the financial year ended March 31,2026 representing a significant decrease of 49.24%. The decrease in trade payables despite higher purchases can be attributed to faster payments made to suppliers, reflecting improved payment efficiency and timely settlement of outstanding dues.

Our Inventory increased by Rs. 799.40 Lakhs from Rs. 3,678.46 Lakhs for the financial year ended March 31,2025 to Rs. 4,477.85 Lakhs for the financial year ended March 31,2026 representing an increase of 2173%, such increase is on account of increase in production.

Our short-term loans and advances given decreased by Rs. 29.61 Lakhs from Rs. 207.37 Lakhs for the financial year ended March 31,2025 to Rs. 177.76 Lakhs for the financial year ended March 31,2026 representing a decrease of 14.28%, such significant decrease is on account of decrease in Loans & Advances to Related parties.

Our long-term loans and advances given decreased by Rs. 9.28 Lakhs from Rs. 311.59 Lakhs for the financial year ended March 31,2025 to Rs. 302.31 Lakhs for the financial year ended March 31,2026 representing a decrease of 2.98%, such nominal decrease is on account of decrease in long term advance to suppliers.

Our Long-Term Borrowings increased by Rs. 135.73 Lakhs from Rs. 169.84 Lakhs for the financial year ended March 31,2024 to Rs. 305.57 Lakhs for the financial year ended March 31,2025 representing an increase of 79.92%, such significant increase is on account of addition of Rupee Term Loan for working capital requirements.

Our Short-Term Borrowings increased by Rs. 441.92 Lakhs from Rs. 946.86 Lakhs for the financial year ended March 31,2024 to Rs. 1,388.77 Lakhs for the financial year ended March 31,2025 representing a nominal increase of 46.67% due to addition of Loan from Directors & Related Party & increase in overdraft facility.

Our Trade Receivables increased by Rs. 1,837.45 Lakhs from Rs. 154.08 Lakhs for the financial year ended March 31,2024 to Rs. 1,991.53 Lakhs for the financial year ended March 31,2025 representing an increase of 1,192.54%, such significant increase is on account of increase in revenue from operations.

Our Trade Payables increased by Rs. 1,662.95 Lakhs from Rs. 1,440.50 Lakhs for the financial year ended March 31,2024 to Rs. 3,103.45 Lakhs for the financial year ended March 31,2025 representing an increase of 115.44%, such increase is on account of increase in purchase of raw materials and trading goods due to increase in revenue from operations.

Our Inventory increased by Rs. 925.37 Lakhs from Rs. 2,753.09 Lakhs for the financial year ended March 31,2024 to Rs. 3,678.46 Lakhs for the financial year ended March 31,2025 representing an increase of 33.61%, such increase is on account of increase in production.

Our short-term loans and advances given decreased by Rs. 74.66 Lakhs from Rs. 282.03 Lakhs for the financial year ended March 31,2024 to Rs. 207.37 Lakhs for the financial year ended March 31,2025 representing a decrease of 26.47%, such significant decrease is on account of decrease in Advance recoverable in cash or kind.

Our long-term loans and advances given increased by Rs. 300.93 Lakhs from Rs. 10.67 Lakhs for the financial year ended March 31,2024 to Rs. 311.59 Lakhs for the financial year ended March 31,2025 representing an increase of 2821.61%, such significant increase is on account of significant increase in capital advances.

The following discussion on results of operations should be read in conjunction with the Restated Financial Results of our Company for the financial years ending on March 31, 2026, 2025 and 2024.

The following table sets forth select financial data from our Financial Statements as Restated Profit and Loss for the financial years ending on March 31, 2026, 2025 and 2024, the components of which are also expressed as a percentage of total revenue for such years.

Total Income: Our total income comprises of revenue from operations and other incomes.

Revenue from operations: Our revenue from operations comprises of Sales of Manufactured Finish Goods, Sale of Traded Goods and Other Operating Revenue which consist of revenue from Packing and Freight and Installation Charges.

Other Income: Our Other Income consists of Interest Income from Loan, Rebate & Discount Received, Foreign Exchage Gain, Balances written off and other income.

Expenses: Our Expenses comprise of Cost of Material Consumed, Change in Inventories of work in progress and finished goods, Employee Benefit Expenses, Finance Cost, Depreciation & Amortisation Expenses and Other Expenses.

Cost of Raw Material Consumed: Our Raw Material consumed consists of Change in Stock of Raw Material, Purchase of Raw Material & Consumption of Stores and Direct Expenses which further includes Power & Fuel, Power Coating Charges, Wages and Installation Expenses.

Changes in Inventories: Our Changes in Inventories comprises of Change in Stock of Finished goods, Traded Goods, Scrap and Iron Dust.

Employee Benefit Expenses: Our employee benefit expense consists of Salaries, Wages & Bonus & Bonus, Directors Remuneration, Gratuity and Contribution to Provident and Other Funds, Staff welfare Expenses and Other Allowances.

Finance Cost: Our finance costs comprise of Interest Expenses, Processing Charges and Foreclosure Charges. Depreciation and amortization expenses: Tangible assets are depreciated over periods corresponding to their estimated useful lives. Depreciation includes depreciation charged on Property, Plant & Equipment excluding freehold land.

Other expenses: Other expenses include Advertisement Expenses, Audit Fees, Business Promotion Expenses, Postage & Courier Expenses, Commission on sales, Conveyance expenses, Discount & Rebate allowed, Charity & Donations, Maintenance Charges, Rates & Taxes, Rates & Taxes, Insurance Expenses, Legal & Professional Charges, Loss on Car Damage, Miscellaneous Expenses, Printing & Stationery Expenses, Office Expenses, Rent, Repair & Maintenance, Bad Debts, Statutory Late Fees, Interest, Demand & Penalties, Telephone & Internet Expenses, Travelling Expenses, Transport Expenses, Vehicle Running & Maintenance Expenses, Freight Expenses, Freight Expenses, Freight Expenses, CSR Expenses, Director Sitting fees.

Tax Expenses: Income taxes are accounted for in accordance with Accounting Standard - 22 on "Accounting for Taxes on Income" ("AS-22"), prescribed under the Companies (Accounting Standards) Rules, 2006 as amended. Our Company provides for current tax as well as deferred tax, as applicable.

Provision for current taxes is made at the current tax rates after taking into consideration the benefits available to our Company under the provisions of the Income Tax Act, 1961.

Deferred tax arises from the timing differences between book profits and taxable profits that originate in one period and are capable of reversal in one or more subsequent periods and is measured using the tax rates and laws applicable as of the date of the financial statements. Our Company provides for deferred tax asset/ liability on such timing differences subject to prudent considerations in respect of deferred tax assets.

Our Total Income increased significantly by Rs. 13,716.90 Lakhs from Rs. 77,44.81 Lakhs for the financial year ended March 31, 2025, to Rs. 21,461.71 Lakhs for the financial year ended March 31, 2026, representing a massive growth of 177.11% due to the factors described below:

Our Revenue from operations increased by Rs.13,716.90 Lakhs from Rs.7,744.81 Lakhs for the financial year ended March 31, 2025, to Rs.21,461.71 Lakhs for the financial year ended March 31, 2026, representing a growth of 177.11%, such significant growth is on account of addition of new customers and repetitive orders from existing customers. Sales of manufactured goods had increased by Rs. 2,785.60 Lakhs, Sales of traded goods had increased by Rs. 10,922.43 Lakhs, Sale of Labour service decreased to nil & Other operating revenue has increased by Rs. 9.07 Lakhs in FY 2025-26.

Our Other Income decreased by Rs. 30.69 Lakhs, from Rs. 30.69 Lakhs for the financial year ended March 31, 2025, to NIL for the financial year ended March 31, 2026, representing a decrease of 100%.

Our Total Expenses increased by Rs. 12,967.06 Lakhs from Rs. 6,708.24 Lakhs for the financial year ended on March 31, 2025, to Rs. 19,575.30 Lakhs for the financial year ended on March 31, 2026, representing an increase of 193.30%, due to the factors described below:

Our Cost of Materials Consumed increased by Rs. 4,060.38 Lakhs from Rs.4,841.38 Lakhs for the financial year ended on March 31, 2025, to Rs.8,901.76 Lakhs for the financial year ended on March 31, 2026, representing an increase of 83.87%.

Our Purchase of Stock in Trade increased by Rs. 9,269.59 Lakhs from Rs. 2,186.73 Lakhs for the financial year ended on March 31, 2025, to Rs. 11,456.32 Lakhs for the financial year ended on March 31, 2026, representing a significant increase of 423.90%.

Our Net Change in Inventory of Finished Goods decreased by Rs. 473.56 lakhs, from Rs. (711.80) Lakhs for the financial year ended March 31, 2025, to Rs. (1,185.37) Lakhs for the financial year ended March 31, 2026, due to increase in closing inventory of finished goods.

Our Employee Benefit Expenses increase by Rs.66.19 Lakhs from Rs.309.26 Lakhs for the financial year ended on March 31, 2025, to Rs.375.45 Lakhs for the financial year ended on March 31, 2026, representing an increase of 21.40%. This was due to an increase in directors remuneration, salaries & bonus, contribution to provident and other funds, staff welfare expenses and gratuity expenses.

Our Other Expenses increased by Rs.44.47 lakhs, from Rs. 82.67 Lakhs for the financial year ended March 31, 2025, to Rs. 127.14 Lakhs for the financial year ended March 31, 2026, representing an increase of 53.79%. This increase in other expenses was primarily attributed to several factors, including increment in repairs & maintenance, rent expenses, printing & stationery, motor car expenses, discount expense, legal & professional charges, security charges, insurance expense & other expenses net off by decrease in Brokerage & commission & Sundry Balances Written off.

Our Finance Cost was Rs. 192.89 Lakhs for the year ended March 31, 2026, as compared to Rs. 122.54 Lakhs for the financial year March 31, 2025, representing an increase of 57.41%. This significant increase was primarily due to the company taking on various secured loans, resulting in higher interest costs and bank processing charges.

Our Depreciation and Amortization Expenses increased by Rs. 7.22 Lakhs from Rs. 53.07 Lakhs for the financial year ended March 31, 2025, to Rs. 60.30 Lakhs for the financial year ended March 31, 2026, representing an increase of 13.61%.

There were no Exceptional Item during the year Profit Before Tax

Our Profit before Tax increased by Rs. 641.57 Lakhs from Rs. 891.65 Lakhs for the financial year ended March 31, 2025, to Rs. 1,533.22 Lakhs for the financial year ending March 31, 2026, representing an increase of 71.95%. This increase was influenced by increase in companys top line volumes increased significantly, adding Rs. 13,716.90 Lakhs more in revenue in FY 2025-26 compared to FY 2024-25.

Our Tax expenses increased by Rs.170.82 Lakhs from Rs. 207.89 Lakhs for the financial year ended March 31, 2025, to Rs. 378.71 Lakhs for the financial year ended March 31, 2026, due to increase in current year tax due to increase in PAT net off by deferred tax liabilities.

Our Profit increased by Rs. 470.75 Lakhs from Rs. 683.76 Lakhs for the financial year ended March 31, 2025, to Rs. 1,154.51 Lakhs for the financial year ended March 31, 2026, representing an increase of 68.85%. This increase was mainly due to increased revenue and improved operational efficiency, which outpaced the growth in expenses.

Our Total Income increased by Rs. 4,988.31 Lakhs from Rs. 2,787.19 Lakhs for the financial year ended March 31, 2024, to Rs. 7,775.51 Lakhs for the financial year ended March 31, 2025, representing a growth of 178.97% due to the factors described below:

Our Revenue from operations increased by Rs.4,958.24 Lakhs from Rs.2,786.57 Lakhs for the financial year ended March 31, 2024, to Rs.7,744.81 Lakhs for the financial year ended March 31, 2025, representing a growth of 177.93%, such significant growth is on account of addition of new customers and repetitive orders from existing customers. Sales of manufactured goods had increased by Rs. 3,375.71 Lakhs, Sales of traded goods had increased by Rs. 1,582.40 Lakhs, Sale of Labour service increased by Rs. 0.07 Lakhs & Other operating revenue has increased by Rs. 0.06 Lakhs in FY 2024-25.

Our Other Income increased by Rs. 30.07 Lakhs, from Rs. 0.62 Lakhs for the financial year ended March 31, 2024, to Rs. 30.69 Lakhs for the financial year ended March 31, 2025, representing an increase of 4830.58% due to profit on sale of assets.

Our Total Expenses increased by Rs. 4,432.12 Lakhs from Rs. 2,276.11 Lakhs for the financial year ended on March 31, 2024 to Rs. 6,708.24 Lakhs for the financial year ended on March 31, 2025, representing an increase of 194.72%, due to the factors described below:

Our Cost of Materials Consumed increased by Rs. 2,928.32 Lakhs from Rs.1,913.06 Lakhs for the financial year ended on March 31, 2024, to Rs.4,841.38 Lakhs for the financial year ended on March 31, 2025, representing an increase of 153.07%.

Our Purchase of Stock in Trade increased by Rs. 1,539.45 Lakhs from Rs. 647.28 Lakhs for the financial year ended on March 31, 2024, to Rs. 2,186.73 Lakhs for the financial year ended on March 31, 2025, representing an incre ase of 237.83%.

Our Net Change in Inventory of Finished Goods decreased by Rs. 177.97 lakhs, from Rs. (533.84) Lakhs for the financial year ended March 31, 2024, to Rs. (711.80) Lakhs for the financial year ended March 31, 2025, due to increase in closing inventory of finished goods.

Our Employee Benefit Expenses increase by Rs.120.24 Lakhs from Rs.189.02 Lakhs for the financial year ended on March 31, 2024, to Rs.309.26 Lakhs for the financial year ended on March 31, 2025, representing an increase of 63.61%. This was due to an increase in directors remuneration, salaries & bonus and gratuity expenses.

Our Other Expenses increased by Rs.22.08 lakhs, from Rs. 60.59 Lakhs for the financial year ended March 31, 2024, to Rs. 82.67 Lakhs for the financial year ended March 31, 2025, representing an increase of 36.44%. This increase in other expenses was primarily attributed to several factors, including increment in bank charges & commission, repairs & maintenance, rent expenses, printing & stationery, motor car expenses, brokerage & commission, discount expense, legal & professional charges & other expenses net off by decrease in interest on late payment of creditors.

Our Finance Cost was Rs. 122.54 Lakhs for the year ended March 31, 2025, as compared to Rs. 107.85 Lakhs for the financial year March 31, 2024, representing an increase of 13.63%. This significant increase was primarily due to the company taking on various secured and unsecured term loans, resulting in higher interest costs and loan processing charges.

Our Depreciation and Amortization Expenses decreased by Rs. 1.23 Lakhs from Rs. 54.31 Lakhs for the financial year ended March 31, 2024, to Rs. 53.07 Lakhs for the financial year ended March 31, 2025, representing a decrease of 2.27%.

There were no Exceptional Item during the year

Our Profit before Tax increased by Rs. 542.73 Lakhs from Rs. 348.92 Lakhs for the financial year ended March 31, 2024, to Rs. 891.65 Lakhs for the financial year ending March 31, 2025, representing an increase of 155.54%. This increase was influenced by the following factors:

The companys top line volumes increased significantly, adding Rs. 4.958.24 Lakhs more in revenue in FY 2024 - 25 compared to FY 2023-24.

The companys other income increased by Rs.30.07 Lakhs due to profit on sale of assets worth Rs.30.69 Lakhs.

Our Tax expenses increased by Rs.121.96 Lakhs from Rs. 85.93 Lakhs for the financial year ended March 31, 2024, to Rs. 207.89 Lakhs for the financial year ended March 31, 2025, due to increase in current year tax due to increase in PAT net off by deferred tax liabilities.

Our Profit increased by Rs. 420.77 Lakhs from Rs. 262.99 Lakhs for the financial year ended March 31, 2024, to Rs. 683.76 Lakhs for the financial year ended March 31, 2025, representing an increase of 159.99%. This increase was mainly due to increased revenue and improved operational efficiency, which outpaced the growth in expenses.

The table below summaries our cash flows from our Restated Financial Statements for the financial years ended on March 31, 2025, 2024 and 2023:

Our net cash used in operating activities for the Financial Year ended March 31, 2026, was Rs.631.47 Lakhs. This was primarily driven by an operating profit before working capital changes of Rs.1,777.92 Lakhs, which was adjusted due to changes in working capital. The significant changes included (i) an increase in inventories of Rs.799.40 Lakhs due to increased production which result into higher inventory days, (ii) a decrease in trade receivables of Rs.149.88 Lakhs as a result of faster collection cycle from customers, supported by stronger receivables management and improved payment discipline, (iii) decrease in short-term loans and advances by Rs.29.61 Lakhs mainly due to decrease in loans & advances to related parties, (iv) increase in other current assets of Rs.58.05 Lakhs due to increase in pre-paid expenses & balance with government authorities, (v) decrease in trade payables of Rs.1,528.06 Lakhs due to faster payments made to suppliers, reflecting improved payment efficiency and timely settlement of outstanding dues and (vi) increase in other current liabilities by Rs.58.01 Lakhs mainly due to increase in advances from customers & director remuneration payable. It was further decreased by income tax payment of Rs.261.39 Lakhs.

Our net cash used in operating activities for the Financial Year ended March 31, 2025, was Rs.232.51 Lakhs. This was primarily driven by an operating profit before working capital changes of Rs.1,034.40 Lakhs, which was adjusted due to changes in working capital. The significant changes included (i) an increase in inventories of Rs.925.37 Lakhs due to increased production which result into higher inventory days, (ii) an increase in trade receivables of Rs.1,837.45 Lakhs as a result of increase in revenue from operations, (iii) decrease in short-term loans and advances by Rs.74.66 Lakhs mainly due to decrease in advances to suppliers and others, (iv) increase in other current assets of Rs.13.12 Lakhs due to increase in pre-paid expenses, (v) increase in trade payables of Rs.1,662.95 Lakhs due to increase in purchases and (vi) decrease in other current liabilities and provisions by Rs.116.62 Lakhs mainly due to settlement of advances from customers. It was further decreased by income tax payment of ^111.95 Lakhs.

Our net cash generated from operating activities for the Financial Year ended March 31, 2024, was Rs.692.9 4 Lakhs. This was primarily driven by an operating profit before working capital changes of Rs.507.32 Lakhs, which was adjusted due to changes in working capital. The significant changes included (i) an increase in inventories of Rs.608.38 Lakhs due to increased production which result into higher inventory days, (ii) an increase in trade receivables of Rs. 70.03 Lakhs as a result of increase in revenue from operations, (iii) increase in short-term loans and advances by Rs. 223.37 Lakhs mainly due to increase in advances to related parties, (iv) increase in trade payables of Rs.1071.92 Lakhs due to increase in purchases, and (v) increase in other current liabilities and provisions by Rs.60.30 Lakhs mainly due to increase in advances from customers. It was further decreased by income tax payment of Rs.44.81 Lakhs.

Our net cash used in investing activities was Rs. 12.07 Lakhs for the financial year 2025-26. This was primarily due to Purchases of Property, Plant & Equipment amounting to Rs. 21.35 Lakhs and decrease in Long-Term Loans & Advances by Rs.9.28 Lakhs.

Our net cash used in investing activities was Rs. 356.46 Lakhs for the financial year 2024-25. This was primarily due to Purchases of Property, Plant & Equipment amounting to Rs. 94.64 Lakhs, Proceeds from Sale of Property Plant & Equipment amounting to Rs. 42.01 Lakhs, Increase in Other Non-Current Assets by Rs. 2.91 Lakhs, and Increase in LongTerm Loans & Advances by Rs.300.93 Lakhs.

Our net cash used in investing activities was Rs. 35.93 Lakhs for the financial year 2023 -24. This was primarily due to Purchases of Property, Plant & Equipment amounting to Rs. 36.65 Lakhs, Proceeds from Sale of Property Plant & Equipment amounting to Rs. 0.72 Lakhs, Increase in Other Non-Current Assets by Rs. 0.03 Lakhs, and Interest Income Received of Rs. 0.03 Lakhs.

Net cash generated from financing activities for the Financial year ended March 31, 2026, was Rs. 675.32 Lakhs, which was primarily due to Proceeds of Long-term Borrowings of Rs. 314 Lakhs, Net Proceeds of Short-term Borrowings Rs. 911.15 Lakhs which was offset by Repayment of Long-term Borrowings of Rs. 375.55 Lakhs and Interest Expense of Rs. 174.28 Lakhs.

Net cash generated from financing activities for the Financial year ended March 31, 2025, was Rs. 586.98 Lakhs, which was primarily due to Proceeds from issuance of equity share capital worth Rs. 12 Lakhs, Proceeds from Share Premium Rs. 114 Lakhs, Proceeds of Long-term Borrowings of Rs. 242 Lakhs, Repayment of Long-term Borrowings of Rs. 106.27 Lakhs, Proceeds of Short-term Borrowings Rs. 441.92 Lakhs, and Interest Expense of Rs. 116.67 Lakhs.

Net cash used in financing activities for the Financial year ended March 31, 2024, was Rs. 642.38 Lakhs, which was primarily due to Proceeds of Long-term Borrowings of Rs. 96 Lakhs, Repayment of Long-term Borrowings of Rs. 64.15 Lakhs, Repayment of Short-term Borrowings Rs. 571.35 Lakhs, and Interest Expense of Rs.102.89 Lakhs.

The table below summaries key ratios in our Restated Financial Statements for the financial years ended on March 31, 2025, 2024 and 2023:

Fixed Asset Turnover Ratio: This is defined as revenue from operations divided by total fixed assets based on Financial Statements as Restated.

Current Ratio: This is defined as current assets divided by current liabilities, based on Financial Statements as Restated.

Debt Equity Ratio: This is defined as total debt divided by total shareholder funds. Total debt is the sum of longterm borrowings, short-term borrowings and current maturities of long-term debt, based on Financial Statements as Restated.

Inventory Turnover Ratio: This is defined as cost of goods sold divided by average inventory based on Financial Statements as restated.

As on March 31, 2026, the total outstanding borrowings of our Company is as below. For further details, refer to the chapter titled "Statement of Financial Indebtedness" beginning on page 220 of this Red Herring Prospectus.

Related party transactions with our promoters, directors and their entities and relatives primarily relate to purchase and sale of products and services. For further information, please refer to the chapter titled "Financial Statements as Restated on page 200 of this Red Herring Prospectus.

We do not have any other off-balance sheet arrangements, derivative instruments or other relationships with any entity that have been established for the purposes of facilitating off-balance sheet arrangements.

Market risk is the risk of loss related to adverse changes in market prices, including interest rate risk. We are exposed to interest rate risk, inflation and credit risk in the normal course of our business.

Our financial results are subject to changes in interest rates, which may affect our debt service obligations and our access to funds.

We are affected by inflation as it has an impact on the raw material cost, wages, etc. In line with changing inflation rates, we rework our margins so as to absorb the inflationary impact.

We are exposed to credit risk on monies owed to us by our customers. If our customers do not pay us promptly, or at all, we may have to make provisions for or write-off such amounts.

Except as disclosed in chapter titled "Financial Statements as Restated beginning on page 201 of this Red Herring Prospectus, there have been no reservations, qualifications and adverse remarks.

Details of Default, if any, including therein the Amount Involved, Duration of Default and Present Status, in Repayment of Statutory Dues or Repayment of Deposits or Repayment of Loans from any Bank or Financial Institution.

Except as disclosed in chapter titled "Financial Statements as Restated beginning on page 201 of this Red Herring Prospectus, there have been no defaults in payment of statutory dues and interest thereon or repayment of deposits and interest thereon or repayment of loans from any bank or financial institution and interest thereon by the Company.

There are no transactions or events, which in our best judgment, would be considered unusual or infrequent that have significantly affected operations of the Company.

There are no significant economic changes that materially affected Companys operations or are likely to affect income from continuing operations. Any slowdown in the growth of Indian economy or future volatility in global commodity prices, could affect the business including the future financial performance, shareholders funds and ability to implement strategy and the price of the Equity Shares.

Other than as disclosed in the chapter titled "Risk Factors" beginning on page 22 of this Red Herring Prospectus to our knowledge, there are no known trends or uncertainties that have or had or are expected to have a material adverse impact on revenues or income of our Company from continuing operations.

According to our knowledge, there are no future relationship between cost and income that would be expected to have a material adverse impact on our operations and revenues. However, increase in the cost of the goods in which the Company deals, will affect the profitability of the Company. Further, the Company may not be able to pass on the increase in prices of the services to the customers in full and this can be offset through cost reduction.

The increase in revenue is by and large linked to increase in volume of all the activities carried out by the Company.

Our Company is engaged in in manufacturing and selling Polypropylene (PP)/ High Density Polyethylene (HDPE) Woven Sack Bags & Fabric based products of different weight, sizes and colours as per customers specifications like, HDPE Trampoline and Coloured Woven Fabric Sheets, Loop handle bags. We also trade in plastic granules.

Relevant industry data, as available, has been included in the chapter titled "Industry Overview" beginning on page 103 of this Red Herring Prospectus.

Except as disclosed elsewhere in the Red Herring Prospectus, we have not announced and do not expect to announce in the near future any new business segments.

The business of our company is not seasonal, hence there is no impact of seasonality on our turnover and operations. However, one of the industries that we cater to, i.e., construction industry slows down its operations typically during monsoon due to unfavourable weather conditions.

We depend on external suppliers for all the raw materials required and typically purchase raw materials on a purchase order basis and place such orders with them in advance based on our projected requirements. As a result, the success of our business is significantly dependent on maintaining good relationships with our suppliers. The absence of longterm supply contracts subjects us to risks such as price volatility caused by various factors viz. commodity market fluctuations, currency fluctuations, climatic and environmental conditions, transportation cost, changes in domestic regulatory changes and trade sanctions. If we cannot fully offset the increase in raw material prices with an increase in the prices for our products, we will experience lower profit margins, which in turn may have a material adverse effect on our results of operations, and financial condition and ultimately lead to a liquidity crunch. In the absence of such contracts, we are also exposed to the risk of unavailability of raw materials in desired quantities and qualities, in a timely manner.

We have competition with domestic and international bedding essentials manufacturers who may vertically integrate their supply chains by acquiring or establishing their own distribution operation which reduces the need for independent distributors and create additional competition in the market. We expect competition to intensify due to possible new entrants in the market, existing competitors further expanding their operations and our entry into new markets where we may compete with well-established unorganized companies/ entities. This we believe may impact our financial condition and operations. For details, please refer to the chapter titled "Risk Factors" beginning on page 22 of this Red Herring Prospectus.