Konark Synthetic Limited is a Mumbai-based textile manufacturer and trader with over **30 years** of operational history. The company operates a vertically integrated business model within the textile sector, encompassing the production of raw materials through to finished apparel. The company is currently navigating a period of significant structural transition, characterized by asset monetization, subsidiary insolvency, and a strategic shift toward standalone operations. ### Core Business Operations and Product Portfolio The company operates as a single reportable business segment: **Textiles**. Its operations are centralized at its dedicated facility in the Union Territory of Dadra & Nagar Haveli. * **Manufacturing:** Production of **Synthetic Yarn** and **Readymade Garments**. The company specializes in various types of synthetic yarn, with recent developments focused on new variants for the **suiting industry**. * **Trading:** Wholesale trading of **Fabric**. * **Processing:** Involvement in weaving and textile processing activities. * **Operational Infrastructure:** * **Silvassa Unit:** Located at Plot No. 25, Silvassa Industrial Co-op. Soc., Village Amli. This serves as the core manufacturing hub. * **Corporate Oversight:** Managed from the registered office in **Andheri (East), Mumbai**. ### Strategic Asset Monetization and Portfolio Rationalization Konark Synthetic is currently executing a phase of **asset monetization** to optimize its balance sheet and streamline its corporate perimeter. * **Industrial Property Sale:** In **July 2025**, the company completed the sale of its primary industrial property at **Plot No. 25, Silvassa** to **M/s. Amar Texoweaves LLP** for a total consideration of **₹7.00 Crores**. * **Equity Divestment:** In **October 2024**, the company exited its investment in **Konark Infratech Private Limited**, selling its entire holding of **28,000 equity shares**. Consequently, the entity ceased to be an Associate Company. * **Release of Guarantees:** In **May 2025**, a corporate guarantee of **₹46.00 Crores** previously extended for **Konark Gujarat PV Pvt. Ltd** was officially released by the lender, **L&T Finance Limited**. ### Financial Performance and Capital Structure The company returned to marginal profitability in **FY 2023-24** following a significant net loss in the preceding year, despite a slight contraction in top-line revenue. | Metric (Rs. in Crore) | FY 2023-24 | FY 2022-23 | FY 2021-22 | | :--- | :--- | :--- | :--- | | **Revenue from Operations** | **43.60** | **47.36** | **40.10** | | **Profit / (Loss) After Tax** | **0.1278** | **(8.73)** | **(0.44)** | | **Paid-up Share Capital** | **5.81** | **5.81** | **5.81** | * **Capital Structure:** The share capital consists of **58,08,000 Equity Shares** at a face value of **₹10** each. There are currently **no** active buy-backs, rights issues, or preferential issues. * **Dividend Policy:** The Board has recommended **no dividend** for recent financial years to conserve resources. * **Debt Profile:** * **IDBI Bank Ltd Term Loan:** **₹5.97 Crores** (as of March 2024), secured against residential property and personal guarantees; interest at **10.15% p.a.** * **PNB Housing Finance Ltd Loan:** **₹1.61 Crores** (as of March 2024), secured against commercial properties in CBD Belapur; interest at **11.97% p.a.** * **Working Capital:** Maintains a cash credit facility of **₹13.50 Crores** with **Union Bank of India**, secured against inventory and book debts. ### Operational Efficiency and R&D Strategy The company focuses on technology adaptation and process modification to improve margins in a competitive landscape. * **Energy & Cost Management:** Implements continuous energy audits and preventive maintenance at the Silvassa plant to minimize breakdowns and production costs. * **Research & Development:** While current R&D expenditure is **Nil (0% of turnover)**, the company has stated future plans to develop new yarn varieties to meet evolving domestic and international customer requirements. * **International Trade:** For the periods **2022-23** and **2023-24**, both **Foreign Exchange Earnings** and **Foreign Exchange Outgo** remained at **0.00**. ### Critical Risk Factors and Contingent Liabilities The company faces material uncertainty regarding its solvency and the recoverability of significant assets. **1. Subsidiary Insolvency (India Denim Limited)** * **India Denim Limited (IDL)** is under the **Corporate Insolvency Resolution Process (CIRP)** as of **September 22, 2023**. * Konark Synthetic has made a **full provision** for its investment in IDL. * The company is unable to produce **Consolidated Financial Results** because the subsidiary's board is suspended and records are with an Interim Resolution Professional (IRP). **2. Corporate Guarantees and Solvency** * The company has a contingent liability of **₹27.06 Crore** due to guarantees for IDL (now an NPA). * Auditors have noted that this liability is **much higher than the total net worth** of the company, creating material uncertainty about its ability to continue as a going concern. **3. Trade Receivable Risks** Significant capital is locked in receivables from companies undergoing insolvency: * **Mudra Denims Private Limited:** **₹7.11 Crore** outstanding; only **₹1.78 Crore** provisioned. * **Shubhlakshmi Polyester Limited:** **₹93.47 Lakhs** outstanding; no provision made. * Auditors have highlighted a **material weakness** in internal controls, as no legal proceedings have been initiated against these debtors. **4. Governance and Compliance** * **Leadership:** **Mr. Shonit Dalmia** was re-appointed as **Managing Director** for a 3-year term (2025–2028). * **Compliance Gaps:** The company faced a **187-day delay** in appointing a Compliance Officer in 2025 and saw the resignation of its statutory auditors in **August 2023** following a dispute over professional fees.