Karnika Industries reported a consolidated net profit of ₹913.75 lakh for the quarter ended June 30, 2026, driven by revenue from operations of ₹7377.20 lakh. On a standalone basis, the company recorded a net profit of ₹735.19 lakh, with revenue from operations reaching ₹5977.78 lakh during the same period. The financial results were reviewed and approved by the Board of Directors in a meeting held on July 04, 2026.

The company published the unaudited standalone and consolidated financial results for the quarter ended June 30, 2026, in "Business Standard" (English) and "Ek Din" (Bengali) on July 6, 2026. This publication was made pursuant to Regulation 30 read with Schedule III, Part A, Para A and Regulation 47 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Financial Performance

The company's standalone total income for Q1FY27 stood at ₹6140.27 lakh, compared to ₹3420.78 lakh in the corresponding quarter of the previous year. Total expenses for the standalone entity were reported at ₹5100.85 lakh. For the consolidated entity, which includes subsidiary Kidcity Solutions Private Limited, total income was ₹7548.47 lakh against total expenses of ₹6270.57 lakh.

Key Standalone Metrics

Key Consolidated Metrics

Corporate Developments

During the quarter, the Board approved the preferential issue of 39,66,860 equity share warrants to promoter and non-promoter investors. Each warrant is convertible into one equity share with a face value of ₹10 at an exercise price of ₹121 per share within 18 months from the date of allotment. Warrant holders paid 25% of the issue price, amounting to ₹11,99,97,521, at the time of issue.

The company confirmed that it has fully utilized its IPO proceeds in FY 2023-24 and submitted the relevant utilization certificate to the exchange on June 5, 2025. Regarding the preferential issue proceeds, ₹1199.97 lakh was utilized for working capital expenditure, leaving an unutilized balance of ₹0.01 lakh as of June 30, 2026.

Auditor and Regulatory Disclosures

The statutory auditors, M/s A A A J & Associates, performed a limited review of the standalone and consolidated financial results. The auditors issued an unmodified report, confirming that the statements are free of material misstatement and comply with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company operates in a single business segment, textiles, which includes fabrics, ready-made garments, and accessories.

Karnika Industries has allotted 39,66,860 convertible warrants at a price of ₹121 each on a preferential basis to promoters and non-promoters. The Board of Directors approved the allotment on June 18, 2026, following the receipt of 25% of the subscription amount from the allottees. The warrants carry a premium of ₹111 over the face value of ₹10 per share.

The allotment was approved by shareholders at an Extra-Ordinary General Meeting held on May 11, 2026, and received in-principle approval from the National Stock Exchange of India Limited on June 5, 2026. The issuance complies with Section 42 and 62 of the Companies Act, 2013, and Chapter V of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018.

Warrant Details

Each warrant entitles the holder to subscribe to one fully paid-up equity share of ₹10 each. The warrants can be exercised in one or more tranches on or before the expiry of 18 months from the date of allotment. If the conversion option is not exercised within this period, the warrants will lapse, and the amount paid will be forfeited by the company.

Allottee Breakdown

The warrants were allotted to 14 entities, including promoters and a non-promoter. The table below details the allocation:

Post-Allotment Shareholding

Assuming full conversion of the warrants, the shareholding structure will change. For instance, Niranjan Mundhra’s holding will increase to 15,412,930 shares, representing 23.36% of the equity share capital. The total number of investors allotted warrants is 14.