TO THE MEMBERS

The Directors are pleased to present herewith the Annual Report of Loyal Textile Mills Limited ("the Company") along with the Audited Financial Statements for the Financial Year ('FY') ended 31 st March 2026.

FINANCIAL HIGHLIGHTS

(Rs. in Crore)

PERFORMANCE OF THE COMPANY

During FY 2025-26, the Company completed the major phase of its restructuring and business consolidation programme initiated during FY 2024-25. The programme was undertaken with the objective of improving the quality of the Company's business, reducing exposure to low-margin and commoditised products and creating a more focused platform for sustainable growth.

The restructuring resulted in a reduction in production volumes and topline, as the Company consciously exited or reduced businesses which did not provide adequate returns. During the year, the Company produced 39.20 lakh kg of yarn (103.47 lakh kg in FY 2024-25), 103.22 lakh metres of woven fabric (218.86 lakh metres in FY 2024-25), 21.46 lakh kg of knitted fabric (51.68 lakh kg in FY 2024-25), and 18.82 lakh pieces of garments (24.63 lakh pieces in FY 2024-25). Product revenue consequently declined to Rs.390.71 crore from Rs.581.81 crore in the previous year. Export revenue stood at Rs.270 crore compared with Rs.384 crore in FY 2024-25, while domestic revenue stood at Rs.115.07 crore compared with Rs.231.13 crore. The reduction was principally attributable to the planned exit from low-margin and non-viable product lines. Export performance was additionally affected by geopolitical developments and supply-chain disruptions in the Middle East. Revenue from operations stood at Rs.421.96 crore compared with Rs.627.78 crore in the previous year. The Company reported a net loss of Rs.66.21 crore, which was impacted by restructuring-related costs, inventory revaluation and under-utilisation of capacity during the period of business realignment. The year's results also included gains from the sale of certain non-core assets, including units in Andhra Pradesh.

The financial performance of FY 2025-26 should accordingly be viewed in the context of both the Company's deliberate business restructuring and the challenging external operating environment. Importantly, despite the signifi cant reduction in topline, EBITDA loss reduced to Rs.4.35 crore from Rs.34.05 crore in the previous year, representing an improvement of Rs.29.70 crore. The improvement in EBITDA and operating loss refl ects the initial Benefits of the Company's product rationalisation, business consolidation and cost optimisation initiatives. While the Benefits of the restructuring have not yet fully translated into overall profi tability, the improvement at the operating level provides a positive foundation for the next phase of the Company's growth.

Management's focus continues to be on rebuilding the business through export-led growth, higher-value products, improved utilisation and operational effi ciency. Throughout the year, the Company maintained operational discipline, with strong emphasis on cost control, supply-chain optimisation and alignment of production volumes with market demand. In parallel, investments continued in workforce development through targeted training programmes, particularly in the garmenting division, to enhance skill levels and productivity across core operational areas.

Outlook

Looking ahead, the Company remains optimistic about its growth prospects, with a strong strategic focus on the technical textile segment, particularly in personal protective wear. This high-value, niche segment continues to gain momentum, supported by heightened global emphasis on workplace safety standards and rising institutional demand across both domestic and export markets.

To meet the increasing demand, the Company is actively enhancing production capacity in the processing & garmenting division. One of the key operational challenges being addressed is the shortage of skilled tailors, which has temporarily constrained output. In response, targeted recruitment drives, and structured skill development programs are being rolled out to strengthen and expand the tailoring workforce.

As part of its comprehensive transformation strategy, the Company has undertaken the following initiatives:

Product Portfolio Realignment: The business has been strategically restructured to focus on the profi table garments segment—particularly technical textiles—while signifi cantly reducing exposure to commodity-driven products like yarn, which are subject to intense price volatility and margin pressure.

Cost Optimization and Effi ciency Enhancement: A series of cost control and operational effi ciency initiatives are underway to further streamline operations, optimize resource utilization, and boost overall productivity.

Expanding the Market Presence: The Company is expanding its market presence in the technical textile & garments segment across the globe and particularly in India. This will grow the business and bring in capacity utilisation at the fullest possible resulting in better margins.

With these strategic actions fi rmly in place, the Company is confi dent of executing a successful turnaround in the upcoming fi scal year. By focusing on high-margin segments, maintaining operational rigor, and investing in workforce capabilities, the Company is well-positioned to enhance competitiveness, improve profi tability, and deliver sustained shareholder value in the years ahead.

DIVIDEND

As the Company has incurred losses due to consolidation of operations and pruning down unviable operations, no dividend is proposed by the Board.

SHARE CAPITAL

As on 31 st March 2026, the paid-up share capital of the Company was Rs.4,81,64,460/- comprising 48,16,446 equity shares of Rs.10/- each. There has been no change in the share capital of the Company during the year under review.

During the year, the company has not issued any shares or any convertible instruments.

TRANSFER TO RESERVES

During the year under review, the Company has not transferred any amount to General Reserve.

MATERIAL CHANGES OCCURED AFTER THE END OF FINANCIAL YEAR

No material changes and commitments which could affect the company's financial position have occurred between the end of the financial year and the date of this report.

MANAGEMENT DISCUSSIONS ON THE INDUSTRY SCENARIO & OUTPUTS

The global technical textiles market is valued at approximately $252.8 billion and is projected to surge to $329.2 billion by 2030, expanding to a compound annual growth rate (CAGR) of 5.6%. Unlike conventional fashion and apparel that prioritize aesthetics, technical textiles are engineered for uncompromising functionality, durability, safety, and performance across diverse industrial and high-tech sectors Many new players are entering this market considering better operability and margins. Protech (Protective Technical Wear) is gaining momentum among the new entrants. West Asia crisis had halted the momentum during this year. GCC being major customer, supply chain disruption has been impacted heavily in the Q4.

Despite these setbacks, the outlook for Global Technical Textile trade remains cautiously optimistic. The stabilization of freight routes and normalization of inventory cycles could further support the industry's path to recovery.

INDIAN TEXTILE INDUSTRY

The Indian Textile and Apparel industry holds a vital position in the national economy, contributing approximately 2.3% to GDP, 13% to industrial output, and 12% to export earnings. It is also the second-largest employer in the country, offering direct employment to 45 million individuals and supporting 60 million more in allied sectors.

The Protech (protective textiles) sector in India is expanding rapidly at an estimated compound annual growth rate (CAGR) of 12% to 14%, outperforming conventional textile applications as domestic industrial safety norms and defense requirements tighten.

Stricter enforcement of occupational health codes across manufacturing, oil and gas extraction, and chemical processing plants demanding certifi ed fl ame-retardant (FR) and chemical-splash apparel are supporting this growth in the Protech segments. India is supposedly the highest CAGR across the globe until 2030.

Going forward, vertically integrated, innovation-driven, cost-effi cient companies and those offering value added – high end products are expected to lead industry growth and profi tability.

Opportunities

Structural growth in domestic and global demand for protective and technical textiles, supported by tightening occupational safety regulation and institutional procurement programmes. Government thrust on technical textiles through the National Technical Textiles Mission and textile park/PM MITRA initiatives, which could improve access to infrastructure, incentives and skilled workforce.

Ability to leverage existing vertically integrated capacity and export relationships to pivot toward higher-margin protective garment categories without large incremental greenfi eld investment.

Further monetisation of non-core/non-operational assets to strengthen the balance sheet and fund working capital for the growing technical textiles order book.

Threats

Continued volatility in cotton and other input costs, which can compress margins across both the legacy commodity business and the technical textiles segment.

Global demand uncertainty and currency volatility affecting export realisations, given the Company's high dependence on international markets.

Competitive intensity from both domestic and international manufacturers in the protective wear space as more players reallocate capacity toward technical textiles.

Execution risk in scaling a new product and compliance-certifi cation pipeline (e.g., safety and quality standards specifi c to protective/medical garments) within the targeted timeframe.

Risks & Concerns

The Company's principal risks include cotton and input price volatility, global demand cyclicality, foreign exchange fl uctuation on export receivables, and execution risk associated with scaling the protective wear business. The Company has instituted internal control systems commensurate with the size and nature of its operations, covering financial reporting, inventory management and statutory compliance, which are reviewed periodically by the Audit Committee and statutory auditors.

Human Resources

The Company continued to focus on workforce productivity and cost rationalisation during the year, including measures to align employee costs with the evolving production mix as capacity is redirected toward technical and protective garments. Employee relations remained cordial throughout the year, and the Company continues to invest in training its garmenting workforce on the specialised stitching, fi nishing and quality-compliance requirements associated with protective garment categories

Key Financial Ratios

Key Financial Ratios and signifi cant changes are detailed in Note 48 of the Standalone Financial Statements.

Outlook for the Company

Against this backdrop, your Company has proactively undertaken several strategic initiatives aimed at repositioning itself for long-term success. While FY 2025-26 was marked by lower capacity utilization and a net loss—primarily due to restructuring and realignment efforts—these decisions were crucial in laying a stronger foundation for the future.

Looking ahead, the Company will focus on:

• Accelerating Growth in Technical Textiles: The Company is prioritizing its presence in the fast-growing technical textile segment, especially in personal protective wear, which is witnessing rising demand from institutional buyers and export markets due to increasing focus on workplace safety and compliance standards.

• Strategic Product Realignment: To improve profi tability, the Company has restructured its product mix, reducing dependence on low-margin commodity segments such as yarn, and shifting its emphasis to higher-value garments and specialized textiles. Growing garments segment will support utilisation and effi ciency of the downstream capacities in spinning, weaving & knitting.

• Improving Operational Effi ciency: A series of measures are underway to optimize production costs, streamline supply chains, and enhance workforce capabilities, particularly within the garmenting division where targeted training programs are addressing skill shortages.

• Market Expansion: A series of efforts are underway to expand the market presence globally and particularly in India considering the potential.

In alignment with broader industry trends, especially the shift toward value added technical garments Company is confi dent of navigating current headwinds and achieving a meaningful turnaround in the coming fi scal year.

RENEWABLE ENERGY

During the year, the company generated 4.19 Cr. units of wind power against 4.82 Cr. units in the previous year and solar power 0.40 Cr units against 0.74 Cr. units in the previous year. The wind and solar power generation during the year has reduced compared to the previous year.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The Particulars required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are furnished in Annexure I to this Report.

CONSOLIDATED FINANCIAL STATEMENT

The consolidated financial statements of the Company are prepared in accordance with the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 and Regulations 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 along with a separate statement containing the salient features of the financial performance of the Joint Venture(s) is attached to the financial statements in the prescribed format.

BOARD MEETING

The Board met five times during the year, and date(s) are given below:

PASSING OF RESOLUTIONS BY CIRCULATION

During the financial year, certain resolutions of the Board were approved by circulation. The Board confirms that these resolutions are following the compliances on the provisions of Section 175 of the Companies Act, 2013, along with the applicable rules and amendments thereto.

DIRECTORS/ KEY MANAGERIAL PERSONNEL Appointment/ Re-appointment

1. Dr. V. Rajesh, Company Secretary, has been appointed as Company Secretary of the Company under Key Managerial Personnel (KMP) as per Section 203 of the Companies Act 2013 and Compliance Offi cer of the Company as per regulation 6(1) of the SEBI LODR Regulations 2015 and the Nodal Offi cer of the Company as per Rule 7(2A) of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 w.e.f. 01.01.2026.

2. In accordance with provisions of the Act and the Articles of Association of the Company, Mrs. Vishala Ramswami (DIN: 06967899), Non-Executive Non-Independent Director is liable to retire by rotation at this AGM and is eligible for re-appointment.

Disclosures required pursuant to Regulation 36 of the SEBI Listing Regulations and the Secretarial Standards on General Meeting ('SS-2') are provided in the Notice of AGM, forming part of the Annual Report, in respect of the appointment and re-appointment of Directors at the ensuing AGM.

INDEPENDENT DIRECTORS

In terms of Section 149 of the Act and the SEBI Listing Regulations, Mr. Lakshmi Narayanan, Mr. K Kumaran, Mrs. Vijayalakshmi Rao, Mr. Gokul S Dixit and Mr. R. Kannan are the Independent Directors of the Company as on the date of this Report.

There are five (5) Independent Directors for the FY 2025 – 26. All Independent Directors of the Company have submitted declarations under Section 149(7) of the Companies Act 2013 confi rming that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations. In terms of Regulation 25(8) of the SEBI Listing Regulations, the Independent Directors have further confi rmed that they are not aware of any circumstance or situation which exists, or may reasonably be anticipated, which could impair or impact their ability to discharge their duties with objective independent judgement and without any external infl uence. The Independent Directors of the Company have undertaken requisite steps towards the inclusion of their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 of the Companies Act, 2013, the Key Managerial Personnel (KMP) of the Company during the financial year 2025-26 comprised the following:

• Mrs. Valli M Ramaswami – Whole Time Director

• Mr. M. E. Manivannan – Whole Time Director

• Mr. N. Srinivasan - Chief Executive Offi cer (up to 30.06.2026)

• Mr. U. Thenappan - Chief Financial Offi cer

• Mr. S. Muthukrishnan - Company Secretary and Compliance Offi cer (up to 31.12.2025)

• Dr. V. Rajesh, Company Secretary and Compliance Offi cer (w.e.f. 01.01.2026)

Changes in Key Managerial Personnel during the Year

During the year under review, the following changes occurred in the composition of Key Managerial Personnel:

• Dr. V. Rajesh was appointed as a Company Secretary and Compliance Offi cer with effect from 01 st January 2026.

Changes Post Financial Year-End

Subsequent to the close of the financial year:

• Mr. N. Srinivasan was resigned from the position of the Chief Executive Offi cer with effect from 30 th June 2026.

CORPORATE GOVERNANCE

The Company has in place a system of Corporate Governance. Corporate Governance is about maximizing shareholder value legally, ethically, and sustainably. The company has taken adequate steps to adhere to all the conditions laid down in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended from time to time with respect to Corporate Governance. A report on Corporate Governance is included as part of this annual report as Annexure VII. A Certifi cate from the Statutory Auditors of the Company confi rming the compliance of conditions of Corporate Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Annual report.

COMMITTEES OF THE BOARD

The Committees of the Board focus on certain specifi c areas and make informed decisions in line with the delegated authority. The following Committees constituted by the Board function according to their respective roles and defi ned scope: • Audit Committee • Nomination and Remuneration Committee • Corporate Social Responsibility Committee • Stakeholders' Relationship Committee Details of composition, terms of reference and number of meetings held in FY26 for the aforementioned committees are given in the report on Corporate Governance, which forms a part of this Report. Further, during the year under review, all recommendations made by the various committees have been considered and accepted by the Board.

BOARD EVALUATION

As required under the provisions of Section 134(3) (p) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board has carried out a formal annual evaluation of its performance, and that of its committees and individual directors based on the guideline formulated by the Nomination & Remuneration Committee.

The performance evaluation of the Directors was completed during the year. The performance evaluation of the Chairperson and the Non-Independent Directors was carried out by the Independent Directors and Non-Executive Director. The Board of Directors expressed their satisfaction with the evaluation process.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

Pursuant to Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has adopted a policy on Familiarisation Program for Independent Directors of the Company.

The Policy on Familiarisation Program as approved can be viewed on the Company's website.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, the company has framed a Vigil Mechanism / Whistle Blower Policy. The Vigil Mechanism Policy has been posted on the website of the Company. It is further affi rmed that none of the members of the Company has been denied access to the Audit Committee. No complaint has been received from any employee during this year.

SECRETARIAL STANDARDS

The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013 the Annual return as on 31st March 2025 is available on the Company's website at www.loyaltextiles.com. Similarly, the Annual return as on 31st March 2026 will also available once fi led with the Registrar of Companies (ROC).

CORPORATE SOCIAL RESPONSIBILITY (CSR)

In accordance with the provisions of Section 135 of the Companies Act, 2013 and the applicable Rules, the Company has constituted a Corporate Social Responsibility (CSR) Committee. The Committee comprises three Directors, including two Independent Directors and one Whole-time Director.

The Company's CSR Policy is available on the Company website at: www.loyaltextiles.com However, the Company did not meet the criteria prescribed under Section 135 of the Companies Act, 2013 for the applicability of Corporate Social Responsibility (CSR) provisions during the financial years 2024-25 and 2025-26.

Accordingly, the provisions relating to CSR were not applicable to the Company during the said financial years.

AUDIT STATUTORY AUDIT

M/s. Brahmayya & Co., Chartered Accountants (Firm Registration No. 000511S), were appointed as the Statutory Auditors of the Company for a period of five years at the 76 th Annual General Meeting held on September 22, 2022. Their term continues until the conclusion of the 81st Annual General Meeting, scheduled for the year 2027.

The Statutory Auditor's Report for the financial year ended 31 st March 2026 does not contain any qualifications, reservations, adverse remarks, or disclaimers.

However, the auditors have included an Emphasis of Matter paragraph, which is reproduced below:

Attention is invited to Note No. 51 of the Standalone Financial Statement, which describes the initiatives undertaken by the management involving Monetization of Assets resulting in scaling down of the operations and relocating manufacturing facilities in order to improve the operational efficiencies. The steps undertaken by the company is stated to be addressing the liquidity constraints and in addition the Management has informed that it continues its efforts in rationalizing its operations by further prioritizing high-value contribution segments and embark on steps towards cost optimization to achieve the targeted operational profi tability and sustainability. Considering the progress in the initiatives undertaken during the year and based on the management assertion of achieving the operational profi ts, the company's operations have been considered sustainable.

Management's Response to the Emphasis of Matter

The Board acknowledges the Auditors' observations and affi rms that appropriate corrective measures are being actively implemented.

The Company continues its efforts towards realignment and rationalisation of its manufacturing operations with the objective of improving capacity utilisation, enhancing operational effi ciencies, prioritizing high-value contributing segments and optimising costs to achieve sustainable profi tability at the operational level. During the year, the Company has made considerable progress in monetisation of underutilised and non-core assets and has further identifi ed certain assets for monetisation, including assets classifi ed as "Held for Sale", with the objective of reduction of debt, strengthening liquidity and improving overall cost effi ciencies. The company has completed major phase of its restructuring & consolidation of operations during the year. Considering the progress achieved so far in operational improvement and liquidity enhancement, the management is confi dent of achieving sustainable operational profi tability in the near future.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and amended Regulation 24A of the SEBI Listing Regulations, the Board has based on the recommendation of Audit Committee approved appointment of Messrs. A. Mohan Kumar & Associates, Company Secretaries, Chennai, a peer reviewed firm of Company Secretaries in Practice as Secretarial Auditors of the Company for a period of five years, i.e., from April 1, 2025 to March 31, 2030, post that in the AGM held on September 26, 2025, the shareholders also approved the above said appointment.

The Report of the Secretarial Auditor, Messrs. A. Mohan Kumar & Associates, Company Secretaries, Chennai for FY 2025-26 is annexed herewith as Annexure - II. The said Secretarial Audit Report does not contain any qualification, reservations, adverse remarks or disclaimer.

COST AUDIT & COST RECORDS

Mr. B. Venkateswar, Practicing Cost Accountant, was appointed as Cost Auditor for auditing the cost accounts of the Company for the year ended 31 st March, 2026. The Cost Audit Report for the financial year 2025-26 will be submitted to the Central Government before the due date.

The Board of Directors of the Company have re-appointed Mr. B. Venkateswar, Practicing Cost Accountant, holding Membership No.27622 as Cost Auditor for the year ending 31 st March 2027.

In accordance with the provisions of Section 148(3) of the Companies Act 2013 read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors is required to be ratified by the Shareholders. Accordingly, resolution seeking ratification for the remuneration payable to Cost Auditors is included as one of the items in the Notice convening the AGM.

INTERNAL AUDITORS

The company has appointed M/s. Capri Assurance and Advisory Services, as External Internal Auditors for the period ending 30 th September, 2026 (for six months period).

OTHER DISCLOSURES

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions entered into by the Company during the financial year 2025-26 were carried out in the ordinary course of business and at arm's length. These transactions were reviewed and approved by the Audit Committee, which comprises independent directors. Where applicable, repetitive transactions were approved through the omnibus approval route, in accordance with the SEBI Listing Regulations and the Company's related party transaction policy.

As per Regulation 23(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a transaction with a related party shall be considered material, if the transaction(s) to be entered into individually or taken together with previous transactions during a financial year, exceeds the thresholds specified in Schedule XII of these regulations. Disclosures pursuant to Section 188(1) of the Companies Act, 2013 are provided in Form AOC 2, which forms part of this Report as Annexure IV. Additional details of related party transactions, including their nature, value, and terms, are set out in Note 47 to the standalone and consolidated financial statements.

Transactions with people's or entities belonging to the promoter group holding 10% or more of the shareholding in the Company are also disclosed in the financial statements.

During the year under review, non-executive directors had no pecuniary relationships or transactions with the Company. The Board of Directors, based on the recommendation of the Audit Committee, has adopted a policy to regulate related party transactions including material related party transactions in accordance with the applicable provisions of the Companies Act 2013 and the SEBI Listing Regulations. The Policy is available on the Company's website at https://loyaltextiles.com/wp-content/uploads/2026/04/Policy-on-Materiality-of-Related-Party-Transactions.pdf Further, during the financial year 2025-26, the Company proposes to enter into related party transactions with Gruppo P& P Loyal S.P.A, the joint venture partner of the Company, which are expected to exceed the materiality threshold of 10% of the Company's annual consolidated turnover as of March 31, 2025. Accordingly, a special resolution seeking shareholder approval for entering into these material transactions has been done with the postal ballot passed on 31.03.2026.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During FY 2025-26, the Company has not given loans and advances made investments, guarantee to any of its joint venture Companies and other body corporates and persons.

DEPOSITS FROM PUBLIC

During the year under review, the Company did not accept any deposits from the public in terms of Section 73 of the Companies Act, 2013. Accordingly, there were no outstanding public deposits, whether principal or interest, as on the date of the balance sheet.

DISCLOSURE UNDER MATERNITY BENEFITS ACT, 1961

During FY 2025-26, the company complied with the relevant applicable provisions of Maternity Benefits Act, 1961.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors hereby confirms that: a. In the preparation of the annual financial statements for the year ended 31 st March 2026, the applicable accounting standards have been followed, along with proper explanations relating to material departures. b. The Directors have selected appropriate accounting policies and applied them consistently and have made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company and the loss for the financial year ended 31st March 2026. c. The Directors have taken proper and suffi cient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. d. The Directors have prepared the annual accounts on a going concern basis. e. The Directors have laid down adequate internal financial controls to be followed by the Company, and such internal financial controls are operating effectively.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

In order to comply with provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder, the Company has formulated and implemented a policy on prevention, prohibition and redressal of complaints related to sexual harassment of women at the workplace. All women employees either permanent, temporary or contractual are covered under the above policy. An Internal Committee (IC) has been set up in compliance with the said Act. During the year under review, there were no cases fi led pursuant to the provisions of the Act however, necessary annual returns have been fi led with respective collectorate. Details of status of complaints as below: f. The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

In accordance with the provisions of Section 124 of the Companies Act, 2013 and the applicable rules made thereunder, the Company has transferred a sum of Rs. 4,39,975/- to the Investor Education and Protection Fund (IEPF) during the year. This amount represents dividends that remained unclaimed and unpaid for a period of seven consecutive years.

As per statutory requirements, any dividend that remains unclaimed or unpaid for seven years from the date of transfer to the unpaid dividend account is required to be transferred to the IEPF.

Due dates for transfer of Unclaimed Dividends to the IEPF are given below:

Members who have not yet en-cashed their dividend warrants for the above financial years are advised to submit their claims to the Company's Registrar and Transfer Agent (RTA) at the earliest by quoting their folio number or DP ID and Client ID.

CREDIT RATING

During the financial year 2025-26, CARE Ratings Limited revised the Company's credit ratings for its bank facilities, citing near-term operational and financial pressures. The revised ratings are as follows:

LISTING

The Company's equity shares are listed on National Stock Exchange India Limited (NSE) and Bombay Stock Exchange Limited (BSE).

PARTICULARS OF EMPLOYEES

In accordance with the provisions of Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, it is confi rmed that no employee of the Company received remuneration of Rs. 1.02 crore or more during the financial year, or Rs. 8.50 lakhs or more per month during any part of the year under review.

RATIO OF REMUNERATION OF DIRECTOR

Pursuant to Section 197(12) of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the statement disclosing the ratio of the Director to the median employee's remuneration is provided in Annexure V to this Report.

CEO / CFO CERTIFICATION

In accordance with Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a certifi cate certifying the accuracy and completeness of the financial statements and cash fl ow statement for the year ended 31 st March 2026, duly signed by the Chief Executive Offi cer and Chief Financial Offi cer, was submitted to the Board of Directors. The certifi cate is annexed to this Report as

Annexure VI.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has in place an adequate internal control system designed to ensure the orderly and efficient conduct of its business, including the safeguarding of assets, the prevention and detection of fraud and errors, the accuracy and completeness of accounting records, and the timely preparation of reliable financial information.

All transactions are properly authorized, recorded, and reported to the management. The Company adheres to applicable accounting standards and statutory requirements in maintaining its books of accounts. The internal audit function, carried out by an independent firm of auditors, regularly evaluates the effectiveness of internal controls and ensures their compliance with the policies approved by the Board.

RISK MANAGEMENT

The company takes utmost care in managing the risks and it helps to improve operations and production. Risk management framework has been formulated. The Board members are regularly informed of the risk assessment and risk mitigation measures. The forex exchange risk is actively managed within the framework laid down by the Forex management policy approved by the Board.

GENERAL

In accordance with the applicable provisions of the Companies Act, 2013 and the Companies (Accounts) Rules, 2014, the Board confirms the following disclosures for the year under review:

• No signifi cant or material orders were passed by any regulators, courts, or tribunals, other than those already considered in the financial statements and disclosed under the Statement on Contingent Liabilities and Commitments in the notes to the financial statements, that would impact the going concern status of the Company or its future operations.

• No instances of fraud were reported by statutory auditors under Section 143(12) of the Companies Act, 2013 to the Audit Committee or the Board of Directors.

• There was no change in the nature of the business of the Company during the financial year. The Company continues to operate in the textile industry, with a strategic focus on value-added offerings, particularly technical textiles and protective wear.

• No proceedings are pending against the Company under the Insolvency and Bankruptcy Code, 2016.

• The Company did not enter into any one-time settlement with any bank or financial institution during the financial year.

ENHANCING SHAREHOLDERS' VALUE

The company believes in the importance of its Members who are among its most important stakeholders. Accordingly, the company's operations are committed to the goal of achieving high levels of performance and cost effectiveness, growth building, enhancing the productive asset and resource base and nurturing overall corporate reputation. The company is also committed to creating value for its stakeholders by ensuring that its corporate actions have positive impact on the socio - economic and environmental growth and development.

ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation for the assistance, co-operation and support extended to the company by the banks and the government departments.

The Board also places on record its sincere appreciation of the response received from the company's valuable customers and thank them for their continued support.

The company is grateful to all the employees for their continued co-operation extended to the company. Their contribution has been outstanding and the Directors place on record their appreciation for the same.

The Directors also thank the stakeholders for their support and for the confi dence they have reposed in the company.

CAUTIONARY STATEMENT

This report, including the Management Discussion and Analysis, contains forward-looking statements that refl ect the Company's current expectations regarding future performance. These statements are subject to inherent risks and uncertainties, and actual results may differ materially from those expressed or implied. Key factors that may impact performance include market demand, raw material availability and pricing, changes in government policies, regulatory developments, tax laws, economic conditions, and other operational or legal matters.