Sanathan Textiles Limited submitted its Annual Report for FY2025-26 to the stock exchanges on August 19, 2026, pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The report covers the company's 21st year of operations and is themed "One Yarn, Many Things: Rooted in Values, Weaving a Better Tomorrow." The 21st Annual General Meeting is scheduled for Friday, September 11, 2026, via video conference.

Financial Performance

Consolidated revenue from operations reached a record ₹3,811.18 crore in FY2025-26, growing 27.10% over ₹2,998.61 crore in FY2024-25. This was driven principally by the commissioning and ramp-up of the Punjab facility operated through wholly owned subsidiary Sanathan Polycot Private Limited. Consolidated EBITDA increased 7.90% to ₹284.35 crore from ₹263.53 crore. However, consolidated profit after tax declined to ₹77.35 crore from ₹160.45 crore, as higher depreciation and finance costs accompanied the capitalisation of the greenfield Punjab plant assets.

The following table summarises consolidated and standalone financial results:

On a standalone basis, revenue from operations grew to ₹3,037.86 crore from ₹2,996.80 crore, with standalone EBITDA margin expanding to 9.12% from 8.87% and standalone profit after tax rising to ₹191.91 crore from ₹174.47 crore — the fourth consecutive year of margin improvement at the standalone level.

During the year, Capital Work-In-Progress of ₹1,971.05 crore was capitalised, reducing the closing CWIP balance to ₹252.00 crore from ₹1,586.95 crore, and increasing net Property, Plant and Equipment to ₹2,804.36 crore from ₹930.87 crore. The company stated that the decline in consolidated profit is explained almost entirely by the higher interest and depreciation that accompany a greenfield project, and that the company reached its annual peak net debt in this investment cycle.

Vertical-Wise Revenue Contribution

Polyester filament yarns remained the dominant business vertical. The following table shows product-wise revenue for FY2025-26:

Polyester filament yarns grew 35.3% to ₹3,118.31 crore, while cotton yarns recorded growth of 3% to ₹583.00 crore.

Manufacturing and Operational Highlights

The company's installed capacity reached 479,250 MTPA across three business verticals. The Wazirabad, Punjab manufacturing facility — operated through Sanathan Polycot Private Limited — commissioned its continuous polymerisation line on August 27, 2025 and ramped up to 700 MTPD by March 2026. The Punjab plant is described as the only integrated polyester filament yarn plant of this scale in North India. The Silvassa facility maintained a capacity utilisation of 96% during the year.

The capacity structure as at year-end is summarised below:

Sustainability and ESG

The company invested ₹73.00 crore in FY2025-26 in technologies and infrastructure to improve environmental performance, compared to ₹6.89 crore in FY2024-25. Key sustainability metrics showed improvement:

Both the Silvassa and Punjab facilities operate Zero Liquid Discharge systems. The Punjab facility uses rice husk biomass as a renewable heating fuel. Sanathan Polycot Private Limited entered into a Power Supply and Consumption Agreement for sourcing 32 MW of renewable power as a captive consumer. The company also presented its first Business Responsibility and Sustainability Report for FY2025-26.

Workforce and CSR

As at March 31, 2026, the Sanathan Textiles Group had 1,843 permanent employees and 6,053 contract workers on a consolidated basis, totalling a workforce of 7,896. Employee benefits expense stood at ₹125.28 crore for FY2025-26. The average percentage increase in employee salaries during the year was 8%.

The company's CSR obligation for FY2025-26 was ₹4.05 crore, of which ₹0.32 crore was spent during the year. The remaining ₹3.73 crore was transferred to the Unspent CSR Account. CSR activities included healthcare support, fire safety infrastructure at the Punjab community, cervical cancer awareness and vaccination initiatives, food distribution, and renovation of K. M. Haji Bachooali ENT Hospital.

Board and Governance

The Board comprised eight directors as at March 31, 2026 — four Executive Directors and four Independent Directors including one woman director. Mr. Sammir Dattani was appointed as Executive Director with effect from May 26, 2025. Mrs. Rupal Vora was reappointed as Independent Director for a second term from April 1, 2026 to March 31, 2029. The Board met five times during FY2025-26. No dividend was recommended for the year in view of ongoing capacity expansion.

ICRA reaffirmed the company's credit ratings: long-term fund-based term loans and limits at [ICRA]A (Positive) and short-term non-fund-based limits at [ICRA]A2+. Walker Chandiok & Co LLP served as statutory auditors and the Board has proposed their reappointment for a second term of five years from the conclusion of the 21st AGM.

Sanathan Textiles Limited reported a robust start to FY27, with consolidated revenue from operations jumping 79.08% year-on-year to ₹1,334.74 crore in the quarter ended June 30, 2026. The significant growth was primarily driven by higher selling prices across yarn verticals and the initial contribution from its newly commissioned Punjab facility. Consolidated EBITDA expanded 55.38% to ₹108.08 crore, while standalone profit after tax (PAT) surged 37.64% to ₹64.95 crore, reflecting improved operational efficiency and disciplined raw material procurement amidst global supply chain disruptions.

The company submitted the earnings call transcript pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were discussed during an investor conference call held on August 04, 2026, attended by Chairman and Managing Director Paresh Dattani, Executive Director Sammir Dattani, and Chief Financial Officer Sanjay Shah.

Financial Performance Highlights

While top-line growth was strong, consolidated PAT declined 41.08% year-on-year to ₹23.82 crore due to higher depreciation and finance costs associated with the Punjab plant, which was under construction in the prior year period. Standalone performance remained resilient, with EBITDA margin expanding by 233 basis points to 11.67%.

Operational Updates and Capacity Expansion

The Punjab facility achieved approximately 80% capacity utilization in Q1FY27, contributing significantly to the consolidated volume of 1 lakh metric tons sold. Management expects utilization to rise to 85-90% in Q2FY27 and reach full capacity by subsequent quarters. At Silvassa, technical textile capacity has been expanded from 9,000 metric tons per annum to 18,000 metric tons per annum, with commercial production expected shortly.

Paresh Dattani highlighted that both facilities operated without interruption despite geopolitical tensions affecting PTA and MEG feedstock markets. The government’s temporary waiver of the 11% customs duty on raw cotton imports from June 1, 2026, provided some relief to input costs.

What the Numbers Show

A key divergence exists between standalone and consolidated profitability. Standalone PAT rose sharply to ₹64.95 crore, whereas consolidated PAT fell to ₹23.82 crore. This discrepancy is largely structural: the Punjab facility incurred full depreciation charges of ₹34.7 crore (up from ₹11.7 crore) and finance costs of ₹38.6 crore (up from ₹4.62 crore), as interest is no longer capitalized. This indicates that while operations are scaling, the financial burden of the new asset base is currently weighing on group-level net margins.

Outlook and Guidance

Management reaffirmed its FY27 EBITDA guidance of ₹520-540 crore. The company plans to phase in a 32-megawatt hybrid wind-solar power arrangement to reduce energy costs. Additionally, Sanathan Textiles is pursuing a greenfield cotton yarn expansion in Madhya Pradesh with an estimated capex of ₹400 crore, targeting 72,500 spindles and incremental revenue of ₹350-375 crore.