Securities and Exchange Board of India (SEBI) has imposed a monetary penalty of ₹5,00,000 on Vedprakash Devkinandan Chiripal, a member of the promoter group of nandan denim . The regulator has also restrained him from accessing the securities market and prohibited him from buying, selling, or dealing in securities for a period of four years. The final order was passed on June 30, 2026, against 226 entities, including the promoter group member, under various sections of the SEBI Act, 1992.

The order was received by the promoter group on July 01, 2026. The action was taken under Sections 11(1), 11(4), 11(4A), 11B (1), and 11B (2) of the SEBI Act, 1992. The market restraint is effective from the date of the final order.

Nandan Denim Limited disclosed that based on its assessment and legal advice, the order does not have any material financial or operational impact on the company. The company further noted that the promoter group reserves the right to appeal against the SEBI order to the Securities Appellate Tribunal (SAT) and the Supreme Court of India under Sections 15T and 15Z of the SEBI Act, 1992, respectively.

Details of the SEBI Order

The following table outlines the key details of the regulatory action:

Nandan Denim Limited reported a net profit of ₹3,312.84 lakh for the financial year ended March 31, 2026, a decrease from ₹3,344.85 lakh in the previous year. Revenue from operations fell to ₹2,87,187.38 lakh from ₹3,54,667.56 lakh in FY25, reflecting a contraction in the top line. The company's total income for the year stood at ₹2,88,607.32 lakh. The Board of Directors approved the audited standalone financial results on May 28, 2026.

The statutory auditor expressed an unmodified opinion on the annual standalone financial results, confirming compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The statement was prepared in accordance with Indian Accounting Standards (Ind AS). For the quarter ended March 31, 2026, the company posted a net profit of ₹950.95 lakh on a total income of ₹54,936.57 lakh.

Financial Performance

The company's profitability was impacted by higher costs during the year. Total expenses for FY26 amounted to ₹2,84,381.75 lakh, a reduction from ₹3,50,845.03 lakh in the prior year, driven largely by lower material costs which fell to ₹2,48,605.16 lakh from ₹3,11,824.47 lakh. Finance costs also decreased significantly to ₹1,766.14 lakh from ₹3,674.20 lakh in FY25. However, employee benefit expenses rose marginally to ₹8,795.13 lakh from ₹8,780.73 lakh.

Balance Sheet and Cash Flows

Nandan Denim's balance sheet size contracted, with total assets decreasing to ₹1,03,161.45 lakh as of March 31, 2026, from ₹1,27,449.18 lakh a year earlier. This reduction was primarily due to a decrease in current assets, which fell to ₹60,254.02 lakh from ₹79,813.07 lakh. Trade receivables reduced substantially to ₹37,664.84 lakh from ₹51,052.81 lakh. The company also lowered its debt burden, with current borrowings decreasing to ₹6,743.71 lakh from ₹18,529.55 lakh.

Cash flow from operating activities improved to ₹14,445.26 lakh in FY26 from ₹9,506.94 lakh in the previous year. This increase was supported by a significant decrease in trade receivables and inventories. However, the company utilized cash in financing activities, primarily due to the repayment of borrowings amounting to ₹12,825.69 lakh, including pre-payments. Consequently, net cash and cash equivalents increased marginally to ₹354.40 lakh from ₹251.30 lakh at the end of FY25.

Board Approvals and Appointments

In addition to the financial results, the Board approved the re-appointment of auditors for the upcoming financial year. M/s. Talati & Talati LLP was re-appointed as the Internal Auditor for FY 2026-27, while M/s. A.G. Tulsian & Co. was re-appointed as the Cost Auditor for the same period. The company also noted that the impact of the new Labour Codes, effective from November 21, 2025, had been recognized in the financials without any material impact.