S.P. Apparels Limited has issued a comprehensive postal ballot notice to its shareholders, seeking approval for critical corporate governance matters through remote electronic voting. The notice, dated February 11, 2026, addresses two significant resolutions that require shareholder consent under regulatory compliance requirements.

Key Resolutions for Shareholder Approval

The postal ballot encompasses two special resolutions that will shape the company's leadership structure and financial flexibility. Both resolutions require careful consideration from shareholders as they involve substantial corporate decisions.

Executive Director Re-appointment

The first resolution seeks approval for the re-appointment of Mrs. S. Latha (DIN: 00003388) as Whole-Time Director designated as Executive Director. Her current tenure expires on August 15, 2026, and the proposed re-appointment would extend her service for an additional 3 years from August 16, 2026.

Mrs. Latha, one of the company's promoters, brings extensive experience in retail business, entrepreneurship, and general administration. Her compensation package includes various perquisites such as company-maintained car, telephone facilities, provident fund contributions, and reimbursement of business entertainment expenses.

Loan and Guarantee Provisions

The second resolution addresses the company's financial operational flexibility by seeking approval to advance loans, provide guarantees, or securities under Section 185 of the Companies Act, 2013. This resolution would authorize the Board of Directors to extend financial support up to ₹100,00,00,000 to persons where company directors have interests.

E-Voting Schedule and Process

The company has established a comprehensive timeline for the postal ballot process, ensuring adequate time for shareholder participation. MUFG Intime India Private Limited (formerly Link Intime India Private Limited) will facilitate the remote e-voting process.

Corporate Governance and Compliance

The postal ballot process demonstrates the company's commitment to regulatory compliance and transparent corporate governance. Sri M. D. Selvaraj (FCS 960 / COP 411), Managing Partner of MDS & Associates LLP, has been appointed as the Scrutinizer to ensure fair and transparent conduct of the e-voting process.

Shareholders can access the complete postal ballot notice on the company's website at www.s-p-apparels.com , as well as on the websites of BSE Limited and National Stock Exchange of India Limited. The notice includes detailed explanatory statements pursuant to Section 102 of the Companies Act, 2013, providing comprehensive information about each resolution.

Financial Performance Context

The company's recent financial performance provides context for the proposed resolutions. For the year ended March 31, 2025, S.P. Apparels reported sales and other income of ₹9890.05 million, with profit after tax of ₹835.31 million and basic earnings per share of ₹33.29.

The voting rights will be proportionate to shareholders' equity stake as of the cut-off date, and results will be communicated to both stock exchanges where the company's shares are listed. This postal ballot represents a significant step in the company's ongoing corporate governance processes and strategic decision-making framework.

S.P. Apparels Limited delivered a steady performance in Q3 FY26 despite sector-wide challenges, with the company maintaining operational efficiency across all verticals while navigating trade policy uncertainties that have now been resolved through recent international agreements.

Financial Performance Highlights

The company reported solid financial results for both the quarter and nine-month periods. On a consolidated basis, revenue from operations in Q3 FY26 reached INR 382.9 crores, representing a 6.6% year-on-year growth. EBITDA grew by 11.2% to INR 56.6 crores with an EBITDA margin of 14.8%, while profit after tax stood at INR 27.0 crores compared to INR 24.8 crores in the previous year, marking a 9.1% increase.

For the nine-month period ended December 2025, the company demonstrated strong momentum with consolidated revenue of INR 1,213.7 crores against INR 995.9 crores in the previous year, achieving robust growth of 21.9%. EBITDA during this period stood at INR 173.2 crores with a margin of 14.3%, while profit after tax reached INR 82.4 crores compared to INR 64.7 crores, representing significant growth of 27.3%.

Trade Agreement Impact and Market Outlook

The resolution of trade uncertainties through recent agreements has provided much-needed clarity for the textile industry. The India-US agreement reducing tariffs to 18% has strengthened the company's competitiveness and opened access to the USD 118 billion US textile import market. Similarly, the India-EU FTA eliminating up to 12% import duties has improved buyer sentiment significantly.

Management highlighted that the temporary pause with US customers due to tariff uncertainties has now eased, with customers resuming order placements and normalizing booking patterns. The company's multi-country manufacturing model, spanning India and Sri Lanka, provides flexibility to navigate market shifts and serve customers efficiently based on landed costs and lead times.

Segment-wise Performance Analysis

The Garment division continued as the company's backbone, with Q3 FY26 adjusted operational revenue of INR 343.6 crores, achieving 7.6% year-on-year growth. Adjusted EBITDA for the division stood at INR 58.3 crores, also growing 7.6% year-on-year. For the nine-month period, the division reported adjusted operational revenue of INR 1,105.7 crores, up 16.7% year-on-year, with adjusted EBITDA of INR 179.2 crores, representing 16.3% growth.

The Young Brand apparel division, being predominantly US-focused, experienced pressure in Q3 due to earlier tariff uncertainty. However, the division maintained healthy operational margins, and with the tariff situation now resolved, customer engagement has picked up sharply with strong order visibility for the upcoming season.

Strategic Initiatives and Capacity Expansion

In Sri Lanka, the company made significant progress by integrating an additional factory, bringing total operational capacity to approximately 1,650 machines. The company expects Sri Lankan operations to reach normalized levels from Q1 FY27 with meaningful shipments and optimum utilization in Q2 FY27. During the year, the acquisition of factories also added new customers, with orders expected to begin in Q1 and steady contribution from Q2 onwards.

SP UK remains a key growth driver with management targeting significant expansion over the next two financial years, aiming for revenue of approximately USD 20 million (INR 200 crores) as customer additions and design-led engagement scale up. The division's ability to source between India and Sri Lanka depending on landed costs provides a distinct competitive advantage.

Future Guidance and Sustainability Commitments

Management maintained their revenue guidance of INR 2,000 crores by FY27 on a consolidated basis, supported by the order pipeline, customer additions in Sri Lanka, resumption of Young Brand expansion, and scaling up of SP UK operations. The company is also progressing on sustainability commitments by planning to add approximately 3 megawatts of rooftop solar capacity across three additional units for FY27, taking total installed in-house solar facility capacity to 4 megawatts.

The Retail division remained EBITDA positive and recently added another anchor store, with both Crocodile and Angel & Rocket brands showing steady performance through disciplined inventory management and improved consumer engagement strategies.