Saraswati Saree Depot reported a 23.45% decline in net profit after tax (PAT) to ₹234.06 crore for the financial year ended March 31, 2026. The drop followed a normalization in inventory movements, which had boosted earnings in the prior year. Revenue from operations grew 4.57% to ₹6,311.62 crore.

The company maintained its debt-free status, with cash reserves rising to ₹699.28 crore. Shareholders overwhelmingly approved the inclusion of real estate development as an additional business object via postal ballot. An interim dividend of ₹1.515 per share was declared during the year.

Financial Performance

Revenue growth was driven by core operations in the saree wholesale segment. However, profitability contracted as the company did not benefit from the significant inventory drawdown seen in FY25. Operating expenses, including employee benefits and depreciation, increased alongside revenue.

EBITDA margins contracted to 5.10% from 7.14% in the previous year. Finance costs fell sharply by 55.99% to ₹10.03 crore, reflecting improved capital efficiency and reduced leverage.

What the Numbers Show

The divergence between revenue growth and profit contraction highlights the impact of inventory accounting on reported earnings. In FY25, a reduction in inventory stock contributed positively to profits. In FY26, inventory levels remained relatively stable, closing at ₹1,206.91 crore compared to ₹1,254.05 crore in FY25. This normalization removed the tailwind present in the prior year's figures, resulting in lower absolute profits despite higher sales volume.

Balance Sheet and Dividends

The company strengthened its liquidity position. Cash and cash equivalents rose by nearly 50% to ₹699.28 crore. Trade receivables decreased to ₹724.20 crore from ₹849.83 crore, indicating improved collection cycles. The current ratio improved to 2.98 times from 2.63 times.

The Board declared an interim dividend of ₹1.515 per equity share during the year, totaling approximately ₹60 million. No final dividend was recommended for the upcoming Annual General Meeting scheduled for September 18, 2026.

Strategic Developments

Shareholders approved an amendment to the Memorandum of Association to include real estate development as an additional object of the company. The resolution received 99.95% support via postal ballot. Management stated this move provides flexibility to evaluate opportunities in the sector while complementing the core textile trading business. No specific projects have been undertaken yet.

The company also initiated a pilot entry into the men's ethnic wear segment and launched its first exclusive retail outlet in Kolhapur to gather direct-to-consumer insights.

Saraswati Saree Depot Limited reported a modest top-line growth in its unaudited financial results for the quarter ended June 30, 2026, with revenue from operations rising 1.9% year-on-year to ₹1,475.90 million. While profit after tax expanded 4.0% to ₹66.05 million, operating profitability contracted as EBITDA declined 13.1% to ₹78.03 million, reflecting pressure on margins.

The company submitted its financial results along with the Limited Review Report in Times Business (English) and Punyanagari (Marathi) on August 15, 2026. Subsequently, on August 18, 2026, it released an investor presentation detailing the performance under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Vidhi Bharat Oswal, Company Secretary and Compliance Officer of Saraswati Saree Depot Limited, signed both the submission letter dated August 16, 2026, and the investor presentation cover letter dated August 18, 2026, from Kolhapur.

Financial Performance

Revenue growth was outpaced by a 3.3% rise in total procurement costs, leading to an 8.1% decline in gross profit to ₹157.99 million. Consequently, the gross margin eased by 118 basis points to 10.70%, down from 11.88% in the corresponding quarter of FY26.

EBITDA margin contracted by 91 basis points to 5.29%, compared to 6.20% in Q1FY26. Employee benefit expenses rose 25.5% to ₹38.63 million, while other expenses stood at ₹41.32 million.

Despite the operating margin squeeze, net profit benefited from a 58.1% increase in other income to ₹13.99 million and minimal finance costs of ₹0.15 million. The basic earnings per share (EPS) was ₹1.70, up from ₹1.61 in Q1FY26.

What the Numbers Show

The divergence between revenue growth (+1.9%) and procurement cost inflation (+3.3%) highlights the primary headwind for the quarter. While the company maintained its debt-free status and improved its cash conversion cycle by 23 days to 49 days, the reliance on other income to bolster net profit suggests that core operational efficiency remains under pressure. Management noted that restoring margins is a priority amid elevated procurement costs.

Business Outlook

The company serves over 13,000 retailer customers through its wholesale network, which accounts for 98.3% of revenue. A new exclusive retail outlet contributes 1.7% of revenue as it enters its ramp-up phase. Management indicated that Q2 and Q3 FY27 performance may not be strictly comparable to the prior year due to the seasonal shift in Diwali dates. The company remains focused on sourcing efficiency and working capital management.