RSWM FY26: Revenue ₹4,554 Cr, EBITDA ₹327 Cr, PAT Turnaround to ₹52 Cr
RSWM Limited reported a decisive FY26 turnaround with standalone net profit of ₹51.98 crore versus a loss of ₹41.28 crore in FY25, on revenue of ₹4,554 crore and EBITDA of ₹327 crore at a 7.1% margin. The Board approved the ESOP Plan 2026 covering up to 9,70,000 equity shares and a Letter of Comfort to ICICI Bank, while the audited results were published in Business Standard and Hindi dailies on May 7, 2026.
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RSWM Limited has reported a decisive turnaround in its audited financial results for Q4 and the full year ended March 31, 2026, swinging to a standalone net profit of ₹51.98 crore compared to a net loss of ₹41.28 crore in the previous year. The company posted FY26 revenue of ₹4,554 crore, EBITDA of ₹327 crore with a 7.1% margin, and PAT of ₹52 crore, reflecting sustained improvement in core profitability driven by disciplined cost management and operating efficiency. The Board of Directors, at its meeting held on May 6, 2026, approved the audited standalone and consolidated financial results, alongside key corporate decisions including the formulation of an Employee Stock Option Plan and issuance of a Letter of Comfort. The statutory auditor, M/s. Lodha & Co LLP, issued an unmodified audit opinion on both standalone and consolidated financial results. The audited financial results were subsequently published in Business Standard (English), Business Remedies, and Nafa Nuksan (Hindi) on May 7, 2026, pursuant to Regulation 47 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Financial Performance Overview
Despite a challenging demand environment, the company delivered sequential improvement in Q4, supported by stable realizations and disciplined cost control. The company's standalone revenue from operations stood at ₹4,553.98 crore for FY26, compared to ₹4,825.29 crore in FY25. On a consolidated basis, revenue from operations was ₹4,554.13 crore for FY26 versus ₹4,825.83 crore in FY25. The following table summarises the key standalone and consolidated financial results:
| Metric: | Standalone FY26 | Standalone FY25 | Consolidated FY26 | Consolidated FY25 |
|---|---|---|---|---|
| Revenue from Operations (₹ cr): | 4,553.98 | 4,825.29 | 4,554.13 | 4,825.83 |
| Total Income (₹ cr): | 4,605.21 | 4,854.64 | 4,605.36 | 4,858.30 |
| Total Expenses (₹ cr): | 4,550.84 | 4,914.21 | 4,551.88 | 4,917.83 |
| Profit/(Loss) Before Tax (₹ cr): | 43.80 | (59.57) | 43.83 | (58.31) |
| Net Profit/(Loss) (₹ cr): | 51.98 | (41.28) | 52.01 | (40.02) |
| Basic EPS (₹): | 11.04 | (8.76) | 11.04 | (8.50) |
| Diluted EPS (₹): | 11.04 | (8.76) | 11.04 | (8.50) |
For Q4 (standalone), net profit was ₹34.55 crore compared to ₹1.59 crore in Q4 of the previous year, while revenue from operations was ₹1,141.96 crore versus ₹1,255.84 crore in the year-ago quarter. Q4 EBITDA stood at ₹69.2 crore, with an EBITDA margin of 6.07% compared to 5.6% in the year-ago period. Total comprehensive income on a standalone basis for FY26 stood at ₹63.82 crore, compared to a loss of ₹1.46 crore in FY25. Other Comprehensive Income for FY26 included an unrealized gain on fair valuation of equity investments of ₹9.15 crore (previous period gain of ₹34.73 crore) and a gain on remeasurements of defined benefit plans of ₹10.20 crore (previous year gain of ₹2.88 crore).
Quarterly and Annual Performance Metrics
The company's operational performance across key metrics — including gross profit, EBITDA, and PAT — is presented in the table below, covering both quarterly and annual comparisons:
| Parameters (₹ in Cr.): | Q4 FY26 | Q4 FY25 | YoY | FY26 | FY25 | YoY |
|---|---|---|---|---|---|---|
| Sales: | 1,142.0 | 1,260.0 | - | 4,554.0 | 4,825.3 | (5.6%) |
| EBITDA: | 69.2 | 70.0 | - | 327.1 | 232.8 | 40.5% |
| EBITDA Margin: | 6.07% | 5.6% | - | 7.1% | 4.8% | 231 bps |
| Gross Profit: | 433.7 | 432.4 | 0.3% | 1,752.8 | 1,728.5 | 1.4% |
| Gross Margin: | 37.4% | 34.2% | 323 bps | 38.1% | 35.6% | 246 bps |
| PAT: | 34.5 | 1.6 | - | 52.0 | (41.3) | - |
| PAT Margin: | 3.0% | 0.1% | 286 bps | 1.1% | (0.9%) | - |
Gross profit for FY26 reached ₹1,752.8 crore, with margins improving to 38.1% from 35.6% in FY25, indicating continued stability in cost structures and a better product mix. EBITDA increased to ₹327.1 crore for FY26, with margins strengthening to 7.1% from 4.8%, demonstrating a 40.5% year-on-year improvement in core profitability.
Segment-wise Performance
The company operates across two primary segments — Yarn and Fabric — with a nascent Food-grade rPET chips segment at the consolidated level. Standalone segment revenue and results for FY26 are presented below:
| Segment: | Revenue FY26 (₹ cr) | Revenue FY25 (₹ cr) | Segment Result FY26 (₹ cr) | Segment Result FY25 (₹ cr) |
|---|---|---|---|---|
| Yarn: | 3,865.03 | 4,112.36 | 129.97 | 31.57 |
| Fabric: | 1,073.23 | 1,131.17 | 35.30 | 31.78 |
The Yarn segment's pre-tax, pre-interest profit improved significantly to ₹129.97 crore in FY26 from ₹31.57 crore in FY25 on a standalone basis. At the consolidated level, Yarn segment assets stood at ₹2,326.08 crore and Fabric segment assets at ₹669.29 crore as at March 31, 2026, with a Food-grade rPET chips segment recording assets of ₹85.70 crore. Total consolidated segment assets were ₹3,617.22 crore, with capital employed at ₹1,361.05 crore. On the liabilities side, consolidated Yarn segment liabilities stood at ₹1,753.61 crore and Fabric segment liabilities at ₹333.21 crore, while the Food-grade rPET chips segment recorded liabilities of ₹85.71 crore.
Balance Sheet and Cash Flow Highlights
As at March 31, 2026, standalone total assets stood at ₹3,467.70 crore (versus ₹3,524.78 crore as at March 31, 2025), while consolidated total assets were ₹3,617.22 crore (versus ₹3,610.78 crore). Standalone equity share capital remained at ₹47.10 crore, with other equity at ₹1,324.55 crore. Standalone long-term borrowings reduced to ₹501.18 crore from ₹532.16 crore, and current borrowings declined to ₹1,008.49 crore from ₹1,089.43 crore. Key standalone balance sheet items include Property, Plant & Equipment of ₹1,384.86 crore, inventories of ₹619.55 crore, and trade receivables of ₹630.52 crore.
| Cash Flow Metric: | Standalone FY26 (₹ cr) | Standalone FY25 (₹ cr) |
|---|---|---|
| Net Cash from Operating Activities: | 427.51 | 410.11 |
| Net Cash from Investing Activities: | (195.91) | (113.46) |
| Net Cash from Financing Activities: | (237.69) | (291.16) |
| Closing Cash & Equivalents: | 3.77 | 9.86 |
On a consolidated basis, net cash from operating activities was ₹434.57 crore for FY26 versus ₹426.39 crore in FY25, with closing cash and cash equivalents at ₹5.36 crore. Consolidated net cash used in investing activities was ₹217.30 crore, while net cash used in financing activities was ₹222.27 crore. The financial results were reviewed and recommended by the Audit Committee and approved by the Board at its meeting on May 6, 2026.
Key Notes and Corporate Developments
Several notable items impacted the reported financials. Exceptional items of ₹10.57 crore (standalone) and ₹10.58 crore (consolidated) were recognised for the full year, relating to reassessed employee benefit obligations arising from the implementation of the New Labour Codes effective November 21, 2025. Additionally, the company re-assessed its Deferred Tax Liability at 25.17% (against 34.94% earlier) following the enactment of the Income-tax Act, 2025, resulting in a lower Deferred Tax Liability by ₹22.66 crore.
Subsequent to the balance sheet date, the Board approved — subject to shareholder and regulatory approvals — the issuance of up to 24,70,000 convertible warrants at ₹146 per share (including a premium of ₹136) to LNJ Textiles Advisory LLP (Promoter Group) on a preferential basis, with each warrant convertible into one equity share of face value ₹10 each within 18 months of allotment. Regarding an electricity duty matter, the Hon'ble High Court of Rajasthan ruled against the company on April 6, 2026; the total electricity duty exposure aggregates to ₹11.07 crore (excluding late payment surcharge). The company is in the process of filing a Special Leave Petition before the Hon'ble Supreme Court of India. The management believes it has a creditable case on merits and that no adjustments are required to be made in these financial results.
ESOP Plan 2026 and Letter of Comfort
RSWM is set to pioneer shared ownership in the textile industry through its Employee Stock Option Plan for the senior leadership team. As part of this initiative, 2% of the company's paid-up share capital will be designated for the ESOP, encompassing around 35 leadership positions. The Board approved the formulation and adoption of the "RSWM Limited Employee Stock Option Plan 2026" for granting stock options convertible into up to 9,70,000 equity shares of ₹10 each (face value) to eligible employees of the company and its subsidiaries, subject to shareholder and regulatory approvals under SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.
| ESOP Plan Parameter: | Details |
|---|---|
| Total Options: | Up to 9,70,000 |
| Equity Shares Covered: | 9,70,000 (face value ₹10 each) |
| Share Capital Allocated: | 2% of paid-up share capital |
| Leadership Positions Covered: | ~35 |
| Exercise Period: | Maximum 4 years from each vesting date |
| Regulatory Compliance: | SEBI (SBEB & SE) Regulations, 2021 |
The Board also approved the issuance of a Letter of Comfort to ICICI Bank Limited in favour of LNJ Institute of Skills & Technology Private Limited, a subsidiary of an associate company, covering an enhanced overdraft facility increased from ₹25.00 crore to ₹35.00 crore. The transaction is at arm's length, with no interest from the promoter or promoter group.
Management Commentary
Speaking on the performance, Mr. Riju Jhunjhunwala, Chairman & Managing Director and CEO, RSWM Limited, said, "Over the past year, RSWM has delivered a decisive turnaround, transitioning from losses to profitability while strengthening our operational and financial foundation. This performance reflects focused execution across our core verticals, sharper product positioning, and disciplined cost management. Our revenues for FY26 stand at ₹4,554 crore, with EBITDA of ₹327 crore and PAT of ₹52 crore, which speaks for the steady momentum we have built through the year. As we look ahead, we remain committed to scaling high-value segments, enhancing global competitiveness, and deepening customer partnerships."
Mr. Rajeev Gupta, Joint Managing Director, RSWM Limited, added, "The global textile industry continues to navigate a complex environment shaped by geopolitical developments, trade disruptions, and tariff uncertainties. Despite these challenges, RSWM has delivered consistent growth over the past year, reflecting the resilience of our business model and the strength of execution. Our ability to adapt through supply chain optimization, sharper market alignment, and stronger internal processes has enabled us to sustain the growth performance. As we look ahead, we remain focused on building on this momentum, leveraging emerging opportunities, and delivering sustainable growth in the quarters to come."
Historical Stock Returns for RSWM
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +2.99% | +13.60% | +15.07% | +17.80% | +7.29% | +15.74% |
How might RSWM's preferential warrant issuance to the promoter group at ₹146 per share impact minority shareholder dilution and stock valuation in the near term?
Given the ongoing geopolitical trade disruptions and tariff uncertainties highlighted by management, which export markets pose the greatest risk or opportunity for RSWM's Yarn and Fabric segments in FY27?
Will the Supreme Court appeal on the ₹11.07 crore electricity duty matter set a broader precedent for other Rajasthan-based textile manufacturers facing similar regulatory exposure?
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