Your Directors have pleasure in presenting their Eighty-Eight (88th) Annual Report of the Company, together with the audited financial statements for the financial year ended 31st March, 2026.
1. FINANCIAL PERFORMANCE
The Financial Year 2025-26 remained challenging in the business scenario of the Textile Industry due to combination of global and domestic factors.
The revenue from operations for the year 2025-26 was Rs 8,088.16 as compared to Rs 948.75 lakhs in previous year, an increase of 752.51%.
The Loss before Exceptional item and Tax was Rs 492.05 lakhs against the previous year loss of Rs (131.66) lakhs. The net profit for the year was Rs 990.35 lakhs against the previous year net profit of ' 6930.94 lakhs.
2. DIVIDEND
The Board of directors of your company have recommended Final dividend at the rate of 5% of the Equity Share Capital of the company for the Financial Year ended 31st March, 2026, subject to approval of the Members of the Company. An Ordinary Resolution seeking approval of the Members for Declaration of the Final Dividend for the Financial Year ended 31st March, 2026 forms part of the Notice of the 88th AGM of the Company.
The Dividend, if declared, will be paid to the Members holding equity shares as on record date i.e., Friday 17th Day of July, 2026, within the statutory timelines after deduction of applicable taxes.
The recommendation of Dividend is in accordance with the Dividend Distribution Policy of the Company adopted as per Regulation 43A of the SEBI Listing Regulations, 2015 and is available on the Company's website at:
https://www.somatextiles.com/wp-content/uploads/2026/06/DIVIDEND-DISTRIBUTION-POLICY.pdf
3. RESERVE
The Board of Directors of your Company has not transferred any amount to reserves during the financial year ended 3151 March, 2026. Accordingly, no reserve has been created or appropriated for the said financial year.
4. PRESENT STATUS OF THE UNIT
The Company was historically engaged in manufacturing cotton yarn, denim fabrics, shirtings, and garments. Following directions of the Hon'ble Gujarat High Court, later upheld by the Hon'ble Supreme Court of India, regarding closure of polluting industries in and around Ahmedabad, the Company discontinued its core manufacturing operations. To ensure business continuity and preserve shareholder value, it diversified into cotton trading from November 2022 and continued operations in the textile value chain. Accordingly, up to the quarter ended September 2025, “Textile” was identified as the primary reportable business segment.
Further, pursuant to the Share Purchase Agreement dated July 09, 2025, executed between the existing Promoters/ Promoter Group and the Purchasers/Transferees, requests were received for transfer of 2,47,68,058 equity shares, representing 74.98% of the paid-up equity share capital of the Company. Consequent to the change in management and control, the Company restructured its business operations and, with effect from the quarter ended December 2025, commenced operations solely in the highway construction business. Accordingly, “Highway Construction” became its only reportable primary business segment thereafter.
5. EXPORT
The FOB value of the exports during the Year under review was Nil against zero export in the previous year due to the closure of the manufacturing operation as detailed in point No 4.
6. CHANGE IN NATURE OF BUSINESS
Consequent to the change in management and control of the Company, the business operations were restructured and diversified, and pursuant thereto, the Company entered into construction activities in line with the existing object clause of its Memorandum of Association; accordingly, with effect from the quarter ended December 2025, the Company commenced operations solely in the highway construction business, which became its only reportable primary business segment, and no separate segment information was therefore required to be disclosed thereafter.
7. OPPORTUNITIES AND CHALLENGES
During the financial year 2025-26, the Company witnessed a significant transition in its business operations. Owing to the discontinuation/non-operation of textile manufacturing activities, the Company commenced infrastructure-related operations, primarily involving execution of road construction and allied projects received from the Holding Company.
The management believes that the infrastructure and road development sector in India offers substantial long-term opportunities driven by increased Government expenditure on roads, highways, urban infrastructure, connectivity and public development initiatives. The Company expects that its association with the Holding Company and group ecosystem will support gradual expansion of operational capabilities and project execution experience in the infrastructure segment.
The Company is focusing on developing technical expertise, strengthening project management capabilities, expanding vendor networks and ensuring efficient resource utilization for successful execution of road construction contracts. The diversification into infrastructure activities is expected to provide an alternative avenue for revenue generation and business growth over the medium to long term.
However, the infrastructure business is exposed to various challenges and risks, including fluctuations in raw material prices, labour availability, regulatory approvals, project execution delays, adverse weather conditions, high working capital requirements and competitive market conditions. Timely execution of projects and effective cost management remain critical for maintaining profitability in this sector.
Further, since the Company is in the initial phase of transitioning into infrastructure-related activities, operational stabilization and strengthening of execution capabilities may require time along with continued financial and managerial support.
The Board and management continuously monitor these opportunities and challenges and remain committed towards improving operational efficiency, maintaining quality standards and strengthening internal control systems to ensure sustainable growth in the Company's business operations.
8. EXPANSION AND MODERNISATION
Company is no more in manufacturing activities; hence the Company did not go for expansion and modernization.
9. CONSOLIDATED FINANCIAL STATEMENT
As required by Regulation 33 of the SEBI (LODR) Regulations, 2015, the Consolidated Audited Financial Statements have been prepared in accordance with the requirements under Accounting Standard AS-21 on “Consolidated Financial Statements” read with AS-23 on the “Accounting for Investment in Associates” read with the provisions of Companies Act, 2013, are provided, forming part of the Annual Report.
10. CASH FLOW STATEMENT
In compliance with the requirement of Section 34 of the SEBI (LODR) Regulations, 2015, the Cash Flow Statement for the year ended 3151 March, 2026 prepared in accordance with the applicable Accounting Standard, is annexed to the financial statement, which forms part of the Annual Report.
11. INSURANCE
The Company's properties including its Building, Plant & Machinery and Stocks among others continue to be adequately insured against fire, flood, earthquake, explosive and other such risks, as considered to be prudent and necessary.
12. INTERNAL FINANCIAL CONTROL
The Company has in place internal financial control systems commensurate with the size, nature and complexity of its operations ensuring proper recording of financials and monitoring of operational effectiveness and efficient conduct of its business including adherence to the Company's Policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and compliance of various applicable regulatory and statutory requirements.
The Internal Auditor monitors and evaluates the efficiency and adequacy of Internal Control System. Based on their report, corrective actions are undertaken by the concerned departments and thereby strengthen the Controls. Significant audit observations corrective measures and actions thereon are presented to the Audit Committee of the Board.
During the year such controls were tested and no reportable material weaknesses were observed.
The Audit Committee comprises the majority of Independent Directors in terms of the applicable provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.
13. FIXED DEPOSITS
Your Company has not accepted any deposit from the Public/Members under Section 73 of the Companies Act, 2013, read with Companies (Acceptance of Deposit) Rules, 2014 during the year under review and there are no deposits pending with the Company as on the Balance Sheet closure date.
14. SHARE CAPITAL
There has been no change in the Company's Issued, Subscribed and Paid-up Equity Share Capital in between the end of financial year 31st March, 2026 and 31st March, 2025. On 31st March, 2026, the Equity Share Capital stood at ' 3303.30 Lacs, dividend in to 33033000 Equity Shares of ' 10 each.
15. DIRECTORS AND KEY MANAGERIAL PERSONNEL Appointment
Mrs. Archana Dheeraj Sonaikar (DIN: 03163283), was appointed as an Independent Director (under Non-Executive category) of the Company, to hold office for a term of five consecutive years i.e., from November 5, 2025 till November 04, 2030 through Postal Ballot on 14th December, 2025.
Mrs. Sunita Gangadhar Jamkhande (DIN: 05161000), was appointed as an Independent Director (under NonExecutive category) of the Company, to hold office for a term of five consecutive years i.e., from November 5, 2025 till November 04, 2030 through Postal Ballot on 14th December, 2025.
Mr. Narsingh Narain Giri (DIN: 09752421), was appointed as an Independent Director (under Non-Executive category) of the Company, to hold office for a term of five consecutive years i.e., from October 10, 2025 till October 09, 2030 through Postal Ballot on 14th December, 2025
Mr. Ameet Harjinder Gadhoke (DIN: 01730158) was appointed as a Managing Director (under Executive category) of the Company, to hold office for a term of five consecutive years i.e., from October 10, 2025 till October 09, 2030 through Postal Ballot on 14th December, 2025.
Mrs. Teja Ranade Gadhoke (DIN: 00028218)was appointed as a Director (under Non- Executive category) of the Company, with effect from October 10, 2025 through Postal Ballot on 14th December, 2025.
Independent Directors and the Managing Director (being a Key Managerial Personnel of the Company) hold office for a fixed term of five years and are not liable to retire by rotation.
Cessation
Shri Surendra Kumar Somany (DIN: 00001131), Non- Executive Director of the Company, ceased to be the Director of the Company w.e.f. the close of business hours on 10th October, 2025 respectively.
Shri Arvind Kumar Somany (DIN: 00024903), Executive Director of the Company, ceased to be the Director of the Company w.e.f. the close of business hours on 10th October, 2025 respectively.
Shri Amit Nandkishore Shah (DIN: 00915449), Independent Director (under Non- Executive Director) of the Company, ceased to be the Director of the Company w.e.f. the close of business hours on 10th October, 2025 respectively.
Shri Omprakash Laxminarayan Kabra (DIN: 10636063), Independent Director (under Non- Executive Director) of the Company, ceased to be the Director of the Company w.e.f. the close of business hours on 10th October, 2025 respectively.
Smt. Rita Chatterjee (DIN: 07973942), Independent Director (under Non- Executive Director) of the Company, ceased to be the Director of the Company w.e.f. the close of business hours on 10th October, 2025 respectively.
The Board places on record the valuable services rendered by Shri Surendra Kumar somany, Shri Arvind Kumar Somany, Shri Amit Nandkishore, Shri Omprakash Laxminarayan Kabra and Smt. Rita Chatterjee during their tenure as Directors of the company and expresses its deep sense of appreciation and gratitude for the same.
Rotation
At the forthcoming 88th Annual General Meeting (AGM) of the Company, Shri Shrikant Bhairaveshwar Bhat (DIN: 00650380) retires by rotation and being eligible, offers himself for re-appointment in accordance with the provisions of the Companies Act, 2013 (“the Act”), and Articles of Association of the Company. The Board recommends his reappointment.
Brief resume, nature of expertise and details of directorship held in other companies of Shri Shrikant Bhairaveshwar Bhat, should be re-appointed in the Notice of the Ensuing Annual General Meeting (AGM), as stated under Secretarial Standard 2 and Regulation 36 of the SEBI (LODR) Regulations, 2015
None of the Directors are disqualified from being appointed or holding office as Directors as stipulated under Section 164(2) of the Companies Act, 2013.
Key Managerial Personnel
Pursuant to the provisions of sub-section (51) of Section 2 and Section 203 of the Companies Act, 2013 read with the Rules framed thereunder, the following persons are the Key Managerial Personnel of the Company as on March 31,2026 are, Mrs. Teja Ranade Gadhoke, Non- Executive Director & Chairperson of the Board,Mr. Ameet Harjinder Gadhoke, Managing Director &Chief Executive Officer, Shri Shrikant Bhairaveshwar Bhat, Whole-time Director & Chief Financial Officer and Mrs. Reena Prasad, Company Secretary & Compliance Officer.
16. DECLARATION OF INDEPENDENT DIRECTORS
The Company has received necessary declarations from each Independent Directors, under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of the SEBI (LODR) Regulations, 2015.
17. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 were not applicable to the Company during the financial year under review, as the Company did not meet the prescribed threshold limits of net worth, turnover or net profit during the immediately preceding financial year. Accordingly, the Company was not required to constitute a Corporate Social Responsibility Committee or undertake CSR activities during the year. Hence, the disclosure relating to CSR under the said provisions is not applicable and no Annual Report on CSR activities is annexed to this Report.
18. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013
The Company has not provided any loan to any person or body corporate or given any guarantee or provided security in connection with such loan or made any investment in the securities of any Body Corporate pursuant to Section 186 of the Companies Act, 2013, during the financial year ended 31st March, 2026.
19. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTY
The Company has adopted a Policy on Related Party Transactions for dealing with the review, approval and monitoring of related party transactions in compliance with the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time. The said Policy is available on the Company's website at www.somatextiles.com/home.php/investors/policies.
During the financial year under review, all contracts / arrangements / transactions entered into by the Company with related parties were in the ordinary course of business and on an arm's length basis and were in compliance with the applicable provisions of the Companies Act, 2013 and the SEBI Listing Regulations. All such transactions were placed before the Audit Committee for review and were approved by the Audit Committee, including the Independent Directors. Wherever required, the same were also approved by the Board of Directors and the Members of the Company.
During the year, pursuant to the Postal Ballot Notice dated 5th November, 2025, the Company sought approval of the Members under Sections 108 and 110 of the Companies Act, 2013 read with Regulation 23 of the SEBI Listing Regulations for entering into Material Related Party Transactions. The resolutions were deemed to have been passed on 14th December, 2025, being the last date of remote e-voting.
The Material Related Party Transactions approved by the Members inter alia included transactions with the following related parties:
i. Roadway Solutions India Infra Limited
ii. Roadway Solutions Precast Concrete Private Limited
iii. Vadodara-Mumbai Expressway 8 Private Limited
iv. Vadodara-Mumbai Expressway Package 9 Private Limited
v. Mumbai Falcons Racing Limited
There was no materially significant related party transactions entered into by the Company with Promoters, Directors, Key Managerial Personnel or other persons who may have had a potential conflict with the interest of the Company at large, except those disclosed above and in the Financial Statements.
The particulars of contracts or arrangements with related parties pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are furnished in Form AOC-2, annexed to this Report and forming part hereof. Details of related party transactions as required under the applicable Accounting Standards are disclosed in the Notes forming part of the Financial Statements.
20. LISTING ON STOCK EXCHANGES
The Equity Shares of the Company are listed at the following Stock Exchanges:-
(a) BSE Limited (BSE).
Address: Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400001
(b) National Stock Exchange of India Limited (NSE).
Address: Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai-400051.
NOTE:
(i) Listing fees have been paid to the Stock Exchanges for the year 2026-27.
(ii) The Calcutta Stock Exchange Association Ltd. has vided its Letter No. CSEA/ID/223/2008 dated 16th April, 2008, confirmed the delisting of Company's Shares from the official List of their exchange. However, Equity Shares have been allowed to be traded under the “Permitted Category” on the Exchange considering the interest of General Investors in the Company.
Stock Code
(i) NSE - SOMATEX, (ii) BSE - 521034, (iii) CSE - 29067.
De-mat ISIN Number in NSDL & CDSL - ISIN - INE 314C01013.
21. WEBSITE DISCLOSURES
In compliance with the provisions of Regulation 30 and Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company maintains a functional website, namely www.somatextiles.com, containing updated information relating to the Company, including details of its business activities, shareholding information, financial results, annual reports, policies, codes, notices, disclosures and other information as required to be hosted thereon under the applicable laws and regulations. The Company ensures timely updation of the website disclosures in accordance with the applicable statutory requirements.
22. DELISTING FROM STOCK EXCHANGE
The Company had vide its application dated 31st March, 2021 submitted an application for voluntary delisting of its equity shares from BSE Limited pursuant to applicable regulations under the SEBI (Delisting of Equity Shares) Regulations. However, after careful consideration, the Board of Directors has decided not to pursue the delisting application any further. Accordingly, the Company has withdrawn/dropped the said application, and the equity shares of the Company shall continue to remain listed on BSE Limited.
Further, the Equity Shares of the Company will continue to be listed on Bombay Stock Exchange Ltd and National Stock Exchange of India Limited.
23. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS
The Auditors Report and Secretarial Auditors Report do not contain any reservation, qualification or adverse remark and therefore need no explanations or comments from the Board of Directors.
24. BOARD’S EVALUATION OF THE PERFORMANCE
In compliance with the Companies Act, 2013, and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance, and that of its Committees and Individual Directors. Feedback was sought by way of a structured questionnaire covering various aspect of Board's functioning, such as adequacy of the Composition of the Board and its Committee, Board culture, execution and performance of specific duties obligations and governance. The manner in which the evaluation has been carried out has been provided in the Corporate Governance Report, forming part of Director's Report.
In a separate meeting of the Independent Directors, performance of the Non-Independent Directors, the Board as a whole and the Chairperson of the Company was evaluated, taking into account the views of Executive Directors and Non-Executive Directors.
25. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
During the year Seven (7) Board Meetings were held, the details of which are given in the Report on Corporate Governance, that forms part of the Director's Report.
The maximum interval between the two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013 and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
26. AUDIT COMMITTEE
The Audit Committee comprises four (4) members, the majority of whom are Independent Directors, namely Mr. Narsingh Narain Giri, Mrs. Archana Dheeraj Sonaikar, and Mrs. Sunita Gangadhar Jamkhande. Mrs. Teja Ranade Gadhoke, a Non-Independent and Promoter Director, is the other member of the Committee. Accordingly, the composition of the Committee is in conformity with the requirements of Sections 134(3) and 177(8) of the Companies Act, 2013, read with the provisions of the SEBI (LODR) Regulations, 2015.
Six (6) Meetings of the Audit Committee were held during the year under review, the details of which are given in the Report on Corporate Governance, forming part of this Report. The Board of Directors accepted all recommendations of the Audit Committee in the reporting period.
27. ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER MECHANISM
The Company has in place a Whistle Blower Policy, as a part of Vigil Mechanism to provide appropriate avenues to the Directors, employees and other Stakeholders of the Company to bring to the attention of the Management any issue which is perceived to be in violation of or in conflict with the Code of conduct, values, principles and beliefs of the Company. The established Vigil Mechanism helps to report concerns about any unethical conduct, financial malpractices or any unhealthy practice prevalent in the Company.
The said Vigil Mechanism provides for adequate safeguards against victimization of persons who use such mechanism and also provides for direct access to the Chairman of the Audit Committee.
The details of this Policy is explained in the Corporate Governance Report forming part of Director's Report and are also available on the Company's website; www.somatextiles.com/home.php/investors/policies.
28. REMUNERATION POLICY
The Board has, on recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes, independence of Directors and other matters as per Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”). The salient features of Company's Nomination and Remuneration Policy is stated in the Corporate Governance Report. The Policy is available on the website of the Company viz. www.somatextiles.com.
29. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of Sections 124 and 125 of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time, dividends remaining unpaid or unclaimed for a period of seven years from the date of transfer to the Unpaid Dividend Account of the Company are required to be transferred to the Investor Education and Protection Fund (“IEPF”) established by the Central Government. Further, shares in respect of which dividend remains unclaimed for seven consecutive years are also required to be transferred to the demat account of the IEPF Authority.
The Board has recommended a Final Dividend of 5% for the Financial Year ended 31st March, 2026, subject to the approval of the Members at the ensuing Annual General Meeting. The said dividend, if remaining unclaimed for the statutory period prescribed under the Act and the IEPF Rules, shall be transferred to the IEPF together with the underlying Equity Shares, as applicable.
During the year under review, no amount and/or shares were due for transfer to the IEPF Authority.
30. CORPORATE GOVERNANCE
Your Company upholds the Standards of Governance and is compliant with the provisions of Corporate Governance, as Stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (listing Regulations).
A Report on ‘Corporate Governance' as well as the certificate from Company's Statutory Auditors, confirming compliance with the requirements of SEBI Listing Regulations, forms part of the Annual Report.
31. CORPORATE GOVERNANCE - VOLUNTARY GUIDELINES 2009
The Ministry of Corporate Affairs, Government of India, had issued a set of Voluntary Guidelines 2009 on Corporate Governance in December, 2009, for voluntary adoption of a set of good practices by the Corporate Sector. These guidelines are expected to serve as a bench mark for the Corporate Sector and also help them in achieving the highest Standard of Corporate Governance. Guidelines are reviewed by the Management from time to time to ensure the adherence of the same voluntarily commensurate with the requirements, best suited to your Company gradually in phases.
32. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report under review, as stipulated under SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 is presented by virtue of an Annexure, forming part of the Directors' Report.
33. DIRECTORS’ RESPONSIBILITY STATEMENT
As required under Section 134(5) of the Companies Act, 2013, the Board of Directors of your Company to the best of their knowledge and belief and on the basis of information and explanation obtained from the operating management, hereby states and confirms: -
(a) that in the preparation of attached Annual Accounts for the Financial Year ended 31st March, 2026 the applicable Accounting Standards have been followed along with proper explanation relating to material departures, wherever, applicable;
(b) that they have selected the Accounting Policies described in notes to accounts, which have been consistently applied, except where otherwise stated and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31st March, 2026 and of the loss of the Company for the year ended on that day.
(c) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and
(d) that they have prepared the attached Annual Accounts on a ‘going concern' basis.
(e) that they had laid down internal financial controls to be followed by the Company and that such internal controls are adequate and were operating effectively.
(f) that they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
34. STATUTORY AUDITORS
In compliance with the provisions of Section 139 and other applicable provisions of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014 (including any statutory modification(s)/ re-enactment(s)/ amendment(s) thereof, for the time being in force), the Members at the Eighty-fourth (84th) Annual General Meeting held on 31st August 2022, had appointed M/s. Pipara & Co.LLP, Chartered Accountants (ICAI Registration No. 107929W), as the Statutory Auditors of the Company, to hold office for a term of five (5) consecutive years from the conclusion of the 84th Annual General Meeting until the conclusion of the 89th Annual General Meeting of the Company.
However, with the Notification dated May 7, 2018 issued by the Ministry of Corporate Affairs (‘MCA'), the first proviso to section 139(1) of the Companies Act, 2013, pertaining to the requirement of annual ratification of appointment of Auditors by Members is omitted.
Accordingly, as per the Companies (Amendment) Act, 2017, ratification of the appointment of Statutory Auditors during their period of appointment will not be considered.
35. SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other applicable provisions, if any, of the Companies Act, 2013, the Board of Directors has appointed M/s. Drolia & Company, Practising Company Secretaries, Kolkata (Certificate of Practice No. 1362), as the Secretarial Auditors of the Company to conduct the Secretarial Audit of the Company for a term of five consecutive financial years commencing from the financial year 2025-26 up to the financial year 2029-30, subject to such approvals as may be required under applicable law.
Accordingly, since the appointment is for a fixed term of five consecutive financial years, there is no requirement for annual re-appointment of the Secretarial Auditor during the said term.
The Secretarial Audit Report for the financial year ended March 31,2026, in the prescribed Form MR-3, forms part of this Annual Report as Annexure.
The Secretarial Auditors have confirmed that they are eligible for appointment and are not disqualified from being appointed as Secretarial Auditors of the Company.
36. MANAGERIAL REMUNERATION
Details of the ratio of the remuneration of each director to the median employee's remuneration and other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached to this Report.
37. SECRETARIAL AUDIT REPORT
A Secretarial Audit Report given by the Secretarial Auditors for the financial year ended 31st March, 2026, in the prescribed form MR-3 is annexed herewith as Annexure to this Report and forms an integral part of this Report.
There are no qualifications, reservations and adverse remarks made by the Secretarial Auditors in their Report.
38. INDUSTRIAL RELATIONS
The industrial relations prevailing in the Company remained cordial and harmonious throughout the year under review. The Management continues to maintain healthy, constructive and mutually beneficial relationships with its employees at all levels.
39. COST AUDITORS
Manufacturing unit of the Company at Ahmedabad was closed as per the Order of Supreme Court following the order of High Court, Gujarat. Therefore, there is no requirement to appoint Cost Auditor in terms of the applicable provisions of the Companies Act, 2013, read with the Companies (Cost Records & Audit) Amendment Rules, 2014.
40. FRAUD REPORTING BY AUDITORS
During the financial year under review, neither the Statutory Auditors nor the Secretarial Auditors of the Company have reported any instance of fraud committed in the Company by its officers or employees to the Audit Committee, the Board or the Central Government under Section 143(12) of the Companies Act, 2013 and the Rules framed thereunder.
41. DEPOSITORY SYSTEMS
The Company's Shares are currently traded in dematerialized form, as per the SEBI directives and the Company has entered in to agreements with the following Depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), for trading in dematerialized form.
Members are therefore advised to avail of the services either of the depositories, to dematerialize their physical shares, if any held by them, for trading in Company's shares smoothly and conveniently.
As on 31st March, 2026, 32,551,229 Equity Shares, constituting 97.41% of the Company's total paid-up Equity Share Capital, were held in dematerialized form.
42. SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE
The Company has in place an Anti-Sexual Harassment Policy in accordance with the provisions of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, to provide a safe and harassment-free workplace for all employees. The Company ensures a zero-tolerance approach towards sexual harassment at the workplace.
An Internal Complaints Committee (“ICC”) has been constituted in compliance with the provisions of the said Act to redress complaints relating to sexual harassment. All employees including permanent, contractual, temporary employees and trainees are covered under the said Policy.
During the financial year 2025-26, the details of complaints received and disposed of areas under:
a) Number of complaints of sexual harassment received: NIL
b) Number of complaints disposed of during the year: NIL
c) Number of cases pending for more than 90 days: NIL
43. ACCOUNTS OF THE SUBSIDIARIES, ASSOCIATE COMPANIES AND JOINT VENTURES
The statement containing the salient features of the financial statement of the company's associate companies under the first proviso to sub-section (3) of section 129 of Companies Act, 2013 is enclosed as AOC-1 in the Annexure.
44. PARTICULARS OF EMPLOYEES
None of the employees of the Company was in receipt of remuneration, for the year or part of the year under review, in excess of the limits prescribed under Section 197 of the Companies Act, 2013 read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time.
45. EXTRACT OF ANNUAL RETURN
In accordance with the provisions of Section 92(3) &Section 134(3)(a) of the Companies Act, 2013, the Annual Return in prescribed format may be accessed on the Company's website at www.somatextiles.com.
46. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company was historically engaged in the manufacturing of cotton yarn, denim fabrics, shirtings, and garments. However, "Highway Construction" has now become its only reportable primary business segment.
For brief information, kindly refer to Point 4 of the Directors' Report.
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, required to be disclosed pursuant to Section 134(3)(m) of the Companies Act, 2013, read with rule 8(3) of the Companies (Accounts) Rules, 2014, as amended is given in the Annexure and forms part of this Report.
47. RISK MANAGEMENT
The Company has in place mechanism to inform Board Members about the Risk Assessment and Risk Minimization procedures which are periodically reviewed to ensure that risks and uncertainties are systematically identified, prioritized and initiated on constant basis.
The risk management procedure is reviewed by the Audit Committee from time to time to ensure that the executive management controls the risks and uncertainties through a proper defined framework and major risks, are properly and systematically addressed through mitigation actions on continuing basis.
48. BUSINESS RESPONSIBILITY REPORT
Business Responsibility Report as per Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, describing the initiatives taken by them from an environmental, social and governance perspective is not applicable to the Company, for the financial year 2025-26 as per the SEBI Notification dated 22nd December, 2015 and Frequently Asked Questions issued by SEBI on SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 dated 29th January, 2016.
49. CAUTIONARY STATEMENT
Statements in the Director's Report and the Management Discussion & Analysis describing Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of future performance and outlook.
50. VARIATION IN VALUATION
During the year under review, there was no instance of one-time settlement with any bank or financial institution necessitating disclosure or reporting in respect of difference in valuation done by the Company.
51. COMPLIANCE OF SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.
52. OTHER DISCLOSURES/REPORTING
Your Directors state that no disclosure and/or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
• Issue of equity shares with differential rights as to dividend, voting or otherwise;
• Issue of shares (including sweat equity shares) to employees of the Company under any scheme;
• No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future;
53. ACKNOWLEDGEMENT
Your Directors place on record their sincere thanks and appreciation for the continuing support and assistance received from the financial institutions, banks, government as well as non-government authorities, customers, vendors, stock exchange and members during the period under review.
Your Company takes pride in all of its dedicated officers, employees and workers, who have been wholeheartedly supporting and sincerely contributing their best for the success and growth of your Company as well as maintaining harmonious relations throughout the Company.
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