Arex Industries reported a 44% decline in net profit to ₹148.2 lakh for the fiscal year ended March 31, 2026, down from ₹263.4 lakh in the previous year. Revenue from operations contracted by 3% to ₹4,963.7 lakh, reflecting softer demand conditions in the garment label sector.

The Board of Directors recommended a final dividend of ₹2.50 per equity share, aggregating to ₹89.97 lakh. This marks the first dividend payout since the previous financial year, when no dividend was declared. The 37th Annual General Meeting is scheduled for September 23, 2026, to approve the financial statements and reappoint retiring directors.

Financial Performance

Revenue from operations fell to ₹4,963.7 lakh from ₹5,114.1 lakh in FY25. Despite the top-line contraction, exports surged by 311% to ₹296.7 lakh, indicating a strategic push into overseas markets. However, this growth was insufficient to offset the decline in domestic sales.

Profit before tax dropped significantly to ₹191.9 lakh from ₹366.6 lakh. Depreciation and amortisation expenses rose to ₹435.7 lakh from ₹413.1 lakh, adding pressure on margins. Finance costs remained relatively stable at ₹103.8 lakh, compared to ₹109.4 lakh in the prior year.

What the Numbers Show

A key divergence in the financials is the sharp decline in other income, which fell to ₹6.2 lakh from ₹69.4 lakh in FY25. In the previous year, other income constituted approximately 25% of total revenue, providing a significant buffer to profitability. This year, other income contributed less than 0.2% of revenue, exposing the core operational challenges more clearly. The drop suggests that last year's profitability was partially supported by non-operational gains that have now normalised.

Balance Sheet and Cash Flow

The company’s total assets stood at ₹4,496.7 lakh, a decrease from ₹4,662.3 lakh in the prior year. Current borrowings increased to ₹1,060.0 lakh from ₹708.8 lakh, while non-current borrowings were fully repaid, reducing the non-current liability burden. Trade receivables declined to ₹682.8 lakh from ₹807.3 lakh, suggesting improved collection efficiency despite lower sales volumes.

Cash generated from operations was ₹757.6 lakh, down from ₹890.5 lakh in FY25. Investing activities consumed ₹474.4 lakh, primarily due to capital expenditures on property, plant, and equipment. The company maintained a positive cash position, with cash and cash equivalents rising to ₹10.6 lakh from ₹4.5 lakh.

Corporate Governance

The AGM will see the reappointment of Directors Pragnesh K Shah and Laxman C Tilani, who retire by rotation. Additionally, members will vote on the reappointment of Aviv J Divekar as an Independent Director for his second and final five-year term. The company has also amended its Memorandum of Association to include business activities related to packaging materials, expanding its scope beyond woven and printed labels.

Arex Industries Limited has fixed September 16, 2026, as the record date for its proposed final dividend of ₹2.50 per equity share for the financial year ended March 31, 2026. The company notified the Bombay Stock Exchange on July 29, 2026, confirming that shareholders holding equity shares as of this date will be eligible to receive the dividend, subject to approval at the ensuing Annual General Meeting (AGM). This clarification provides certainty on the entitlement timeline for investors following the Board’s earlier recommendation of a 25% dividend.

The intimation was issued pursuant to Regulation 42 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. In its Board Meeting held on July 29, 2026, Arex Industries also rectified a clerical error in its standalone audited financial results originally filed on May 21, 2026. Statutory auditors Sweta Patel & Associates confirmed that the correction pertained only to the Other Comprehensive Income (After Tax) and Total Comprehensive Income line items, with no impact on net profit, revenue, or balance sheet figures.

Dividend Eligibility and Payment

Shareholders whose names appear in the Register of Members or on the records of National Securities Depositories Limited (NSDL) or Central Depositories Services (India) Limited (CDSL) as beneficial owners on Wednesday, September 16, 2026, will be eligible for the dividend. If approved by members at the AGM, the dividend will be paid within the statutory time limit. The Board, led by Managing Director Neel Bilgi, emphasized that these steps ensure accurate dissemination of financial information and timely communication of shareholder benefits.

Financial Performance Overview

For the year ended March 31, 2026, Arex Industries reported a net profit of ₹148.15 lakh, down from ₹263.41 lakh in FY25. Revenue from operations stood at ₹4,963.74 lakh, compared to ₹5,114.11 lakh in the previous fiscal year. In Q4FY26, the company recorded a net loss of ₹2.59 lakh, contrasting with a net profit of ₹25.75 lakh in the same quarter last year.

What the Numbers Show

The company’s total comprehensive income for FY26 was corrected to ₹137.28 lakh, down from ₹263.41 lakh in FY25. This decline is driven by a negative Other Comprehensive Income (OCI) of ₹(14.54) lakh in FY26, compared to nil in the previous year. The OCI component includes items that will not be reclassified to profit or loss, adjusted for an income tax impact of ₹3.66 lakh. Despite the drop in comprehensive income, core operational profitability remains positive, with profit before tax at ₹191.88 lakh for the full year.