Sangam (India) Limited has announced a strategic acquisition of 49% equity share capital in Clean Max Kenai Private Limited for up to Rs 24 crore, marking a significant step in the company's renewable energy expansion. The acquisition, disclosed under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, aims to augment captive renewable energy capacity for Sangam's Rajasthan-based manufacturing plants.

Acquisition Details

The transaction involves Clean Max Kenai Private Limited, a special purpose vehicle incorporated on May 21, 2024, with a paid-up share capital of Rs 1,00,000. The target company operates in the generation and transmission of renewable energy sector, specifically focused on hybrid power solutions.

Project Specifications and Strategic Rationale

The acquisition centers around developing a 20 MW wind-solar hybrid captive power project at Bhikamkor, district Jodhpur, Rajasthan. This hybrid renewable energy project is designed to serve Sangam's manufacturing operations while ensuring long-term cost efficiency and sustainability.

Investment Benefits and Returns

The strategic investment offers multiple advantages for Sangam (India) Limited. The company expects to achieve substantial cost optimization through long-term sourcing of renewable power, reducing reliance on grid supply and exposure to tariff volatility. This approach provides improved cost stability and sustained power cost efficiencies throughout the project tenure.

The captive arrangement ensures steady and predictable cash inflows over the project life, providing clear visibility on returns and supporting stable, annuity-like earnings on the invested equity. Additionally, the investment aligns with Sangam's ESG and sustainability objectives by increasing renewable energy usage and strengthening the company's long-term clean energy strategy.

Regulatory and Compliance Aspects

The acquisition does not fall under related party transactions, and the promoter, promoter group, or group companies have no interest in the target entity. The transaction is structured as an arm's length deal, ensuring transparency and regulatory compliance. No specific government or regulatory approvals are required for this acquisition, streamlining the completion process.

Clean Max Kenai Private Limited, being a newly incorporated entity with nil turnover in the last financial year, represents a greenfield opportunity for Sangam to establish its renewable energy footprint in Rajasthan's growing clean energy sector.

Sangam (India) Limited has delivered impressive financial results for Q3FY26, demonstrating strong operational performance and margin expansion across key metrics. The textile manufacturer reported significant growth in profitability while maintaining steady revenue momentum and advancing its sustainability initiatives through renewable energy investments.

Financial Performance Highlights

The company's Q3FY26 results showcase robust growth across profitability metrics. EBITDA reached ₹85 crores, marking a substantial 39.3% year-on-year increase from ₹61 crores in Q3FY25. The EBITDA margin expanded by 283 basis points to 10.9%, reflecting improved operational efficiency and cost management.

Margin Expansion and Operational Efficiency

Gross margin performance showed remarkable improvement, reaching 42.8% in Q3FY26 compared to 36.6% in the previous year, representing a 613 basis points expansion. This translated to gross margin of ₹331 crores, up 20.5% from ₹275 crores in Q3FY25. The company's profit before interest and tax surged 88.5% to ₹60 crores, demonstrating strong operational leverage.

Nine-Month Performance

For the nine-month period ending December 31, 2025, Sangam India maintained strong momentum with revenue of ₹2,362 crores, representing 11.1% growth over the corresponding period. Net profit for nine months reached ₹50 crores, marking a significant 123.2% increase from ₹22 crores in the previous year.

Renewable Energy Expansion

The company is significantly expanding its renewable energy footprint through two major initiatives. Sangam India has entered an agreement with CGE II Hybrid Energy Pvt. Ltd. for 12 MW additional hybrid energy capacity, scheduled to commence by March 2026, with projected annual savings of ₹10 crores. Additionally, an EPC contract with IB Vogt Solar India Pvt. Ltd. will add 18 MW solar energy capacity by Q2 FY27, targeting annual savings of ₹22 crores.

Business Operations and Market Position

Sangam India operates as a vertically integrated textile manufacturer with comprehensive capabilities across spinning, fabric production, and garments. The company maintains production facilities with 306,864 spindles for yarn capacity of 85,140 MTPA and 4,584 rotors with 19,080 MTPA capacity. The fabric division includes 262 denim weaving looms and 333 weaving looms, while the garment segment features 32 knitting machines with 5,400 MTPA capacity.

The company serves diverse markets with revenue distribution showing 60% domestic and 40% export sales. Product portfolio spans PV yarn (2%), cotton yarn (15%), denim fabric (26%), woven fabric with processing (28%), and garments (29%). Sangam India maintains a global presence across 50+ countries, serving marquee clients including Walmart, Primark, Jockey, Mango, and Decathlon.