Disclosure Context

Submitted Integrated Filing (Financials) for Q1 ended June 30, 2026 pursuant to SEBI Circular No. SEBI/HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated December 31, 2024 and BSE Circular No. 20250102-4 dated January 2, 2025. Scrip Code: 521161. The filing includes unaudited financial results with auditor's limited review report.

Financial Results Summary (₹ in Lakhs)

Income Statement:

  • Net sales/income from operations: ₹2,070.36 (Q1 FY26) vs ₹2,197.69 (Q1 FY25)
  • Total income: ₹2,072.19 (Q1 FY26) vs ₹2,223.90 (Q1 FY25)
  • Loss before tax: ₹(628.51) (Q1 FY26) vs ₹(377.05) (Q1 FY25)
  • Net loss for period: ₹(551.84) (Q1 FY26) vs ₹(377.05) (Q1 FY25)
  • Total comprehensive income: ₹(551.84) (Q1 FY26) vs ₹(377.05) (Q1 FY25)

Key Expenses (₹ in Lakhs):

  • Cost of material consumed: ₹1,225.41
  • Employee benefit expenses: ₹474.69
  • Finance cost: ₹125.02
  • Power & fuel: ₹411.35
  • Depreciation: ₹323.65

Capital Structure:

  • Paid-up equity share capital: ₹333.28 lakhs (face value ₹10 each)
  • Other equity: ₹12,561.14 lakhs as of March 31, 2026
  • Revaluation reserve: ₹21,071.14 lakhs (excluded from net worth calculation)
  • Actual net worth: ₹(85.10) lakhs (negative)

Per Share Data:

  • Basic EPS: ₹(16.56) (Q1 FY26) vs ₹(11.31) (Q1 FY25)
  • Diluted EPS: ₹(16.56) (Q1 FY26) vs ₹(11.31) (Q1 FY25)

Auditor's Qualified Opinion

M/s. S. Viswanathan LLP issued a qualified opinion with two main concerns:

1. Material Going Concern Uncertainty:

  • Accumulated losses: ₹10,514.05 lakhs as of March 31, 2026
  • Q1 FY26 loss: ₹551.84 lakhs
  • Negative net worth persists
  • Financial statements prepared on going concern basis based on management's expectation of future profits

2. Non-Remittance of Statutory Dues (as of June 30, 2026):

  • Employees' State Insurance (ESI): ₹5.24 lakhs outstanding (Oct 2025-Jun 2026) with ₹0.19 lakh interest provision
  • Employees' Provident Fund (EPF): ₹149.10 lakhs outstanding (Aug 2024-Jun 2026) with ₹12.80 lakh interest and ₹13.34 lakh damages provisions
  • Post-quarter payment: ₹8.93 lakhs PF + ₹1.07 lakhs interest/damages on July 17, 2026
  • Remaining EPF principal: ₹140.17 lakhs with accumulated interest ₹14.27 lakhs and damages ₹14.67 lakhs
  • TDS/TCS: ₹22.83 lakhs outstanding (May 2025-Jun 2026) with ₹2.47 lakh interest provision
  • Total outstanding statutory dues: ₹177.17 lakhs principal plus accrued interest/penalties

Emphasis of Matter:

  • Capital advances outstanding for over 3 years: ₹21.40 lakhs (machinery) and ₹13.18 lakhs (ring frames)
  • No balance confirmations obtained

Management Response

Regarding Going Concern: Management cites cost reduction measures, revaluation of fixed assets, and expects improved cash flows from government FTAs with EU/USA and Union Budget 2026 initiatives.

Regarding Statutory Dues: Attributes delays to recent stabilization of garments division operations and commits to regularizing payments in coming quarters.

Corporate Governance Status

Company not under corporate governance provisions under Regulation 27(2) of SEBI LODR due to negative net worth calculation excluding revaluation reserve.

Approval and Review

  • Results reviewed by Audit Committee and approved by Board of Directors on August 12, 2026
  • Financial results reviewed by statutory auditors under Regulation 33 of SEBI LODR
  • Company operates in single segment - textiles