Sanathan Textiles Ltd (NSE: SANATHAN) Q3 2026 Earnings Call dated Feb. 09, 2026
Corporate Participants:
Jude D’souza — Sanathan Textiles Pvt
Sammir Dattani — Executive Director
Sanjay Anirudh Shah — Chief Financial Officer
Analysts:
Ashish Upanglawar — Analyst
Harsh Mittal — Analyst
Ryan — Analyst
Taniksht — Analyst
Darshul Pandya — Analyst
Chaitanya Doshi — Analyst
Shruti Seth — Analyst
Aradna Jain — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Sanatan Textures Limited Q3 FY26 earnings call. As a reminder, all participant lines will be in the listen only mode and there’ll be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touchstone phone. I now hand the conference over to Mr. Jude D’. Souza. Thank you. And over to you.
Jude D’souza — Sanathan Textiles Pvt
Thank you. Good evening, ladies and gentlemen. It is my privilege to welcome you all to the earnings conference call of Sanatan Textiles Ltd. For the third quarter and nine months ended December 31, 2025. Before we begin, I would like to remind everyone that certain statements made during this call, including comments on our outlook, expectations and future plans, may be forward looking in nature. These statements are based on management’s current assumptions and assessments and are subject to various risks and uncertainties. Actual results may therefore differ materially from from those expressed or implied during the discussion. Joining us today are Mr.
Paresh Dattani, the chairman and managing director, Mr. Sameer Dutani, the executive director and Mr. Sanjay Shah, the Chief Financial Officer. The call is being recorded and a transcript will be available on our website. Post this discussion. I would now like to invite Mr. Parish Dastani, the Chairman and Managing Director, to share his opening remarks. Thank you, Jude. And a very good evening to everyone. It is a pleasure to connect with all of you as we share our progress for Q3 and the first nine months of FY26. Before getting into our operational and financial performance, I want to briefly set the context on the broader industry landscape which I believe is shaping up to be quite favorable for the Indian textile sector.
Q3 FY26 was a challenging quarter for the industry marked by volatility across global trade, regulatory changes and shift in demand dynamics. Despite this backdrop, Sanatan Textiles delivered consistent operational performance underscoring the resilience of our integrated business model and execution capabilities. During the quarter, demand for textile products was impacted by the elevated US Tariff which led to reduced orders from certain export oriented customers, particularly in the end use segments such as home textiles and apparel. In addition, the change in GST rates on fabric from 12% to 5% resulted in a brief period of inventory buildup across the value chain as customers deferred purchases to benefit from the revised rate.
This was followed by the sudden removal of The BIS QCO requirements in November which created temporary margin pressure for the industry. Despite these external headwinds, we were able to fully utilize our installed capacity at our Silvasa facility by pivoting decisively towards domestic placement of materials. This ability to adapt quickly to evolving regulatory and demand conditions highlights the strength of our market positioning and operational agility. Encouragingly, the challenging challenges faced during Q3 are largely behind us. Recent developments have materially improved sentiments for the textile sector. The settlement of the India U S tariff issue is expected to revive export demand and enhance India’s competitiveness vis other supplier countries.
In parallel, the India EU Trade Agreement opens new opportunities across fashion led consumption as well as value added segments such as technical and automotive sectors. At the domestic level, the reduction in GST rates on fabrics is likely to support demand in the coming months. While the Union budget of 2026 provides a reassuring and forward looking outlook for the textile sector, the government’s emphasis on technical textiles aligns well with our long term strategy, creating a favorable backdrop for sustained growth. Against this external and policy environment, our strategic priorities remain clear. Scaling capacity in a disciplined manner, expanding our technical textile footprint and strengthening our integrated yarn portfolio to drive long term value creation.
I will now hand over to Samin to walk you through the operational performance. Thank you.
Sammir Dattani — Executive Director
Thank you, Chairman. Good evening everyone. I will briefly take you through the operational progress across our manufacturing facilities. The Silvasa facility, Our Silvassa plant continue to operate at optimal capacity utilization throughout the quarter, generating stable revenues. Despite the volatile industry environment, the facility remains a critical anchor for our operations supported by strong execution, product flexibility and the ability to redirect volumes towards domestic markets when required. I’m happy to share that we have progressed well on our technical textile yarn expansion at Sylvasa as well. This expansion will double our installed capacity from 9,000 metric tons per annum to 18,000 metric tons per annum in Q1 FY27, strengthening our presence in the high value technical textile and supporting long term margin improvement.
The Punjab Facility Our Greenfield Punjab facility continues its scale up. During Q3FY26, we had commenced our plant operations with a polymerization capacity at 350. Metric tons per day. During the quarter, we increased this capacity by 25% reaching 450 metric tons per day. Importantly, the incremental volumes were successfully placed with existing and new customers in the North India textile market without any inventory buildup. This scale up resulted in the Punjab facility achieving EBITDA positive performance for the quarter. As of today, the production has reached approximately 575 metric tons per day and we remain on track to achieving phase 1 polymerization capacity of 700 metric tons per day by the end of Q4FY26. As highlighted earlier, the ramp up phase involved certain one time costs including capacity scale up expenses of approximately 3.5 crore during the quarter, lower than the commissioning cost incurred in Q2.
As operations stabilize, we expect further efficiency gains to translate into improved margins and working capital performance. Following the achievement of the full phase one capacity at Punjab, we intend to move towards execution of phase two which will further enhance our polymerization capacity from 700 metric tons per day to 950 metric tons per day. In line with our growth roadmap, we are expanding our cotton yarn operations in Madhya Pradesh through our subsidiary Sanatan College Court Private Limited. The state offers a favorable cotton textile ecosystem and we will share further details as the project progresses. Overall, the operational challenge is largely behind us.
Improving demand, visibility and capacity coming on stream. We believe that FY27 will reflect the full earnings potential of our expanded manufacturing base. I will now hand over to Mr. Sanjay Shah, our CFO to take you through the financial performance.
Sanjay Anirudh Shah — Chief Financial Officer
Thank you, Sameer. Good evening everyone. I will briefly walk you through the financial performance for the quarter and nine months ended December 31, 2025 on a standalone basis. Revenue for Q3 FY26 stood at 768.1 crores, broadly stable on a sequential basis and up 3.6% year on year basis reflecting consistent operation and full capacity utilization at our Sylvasa facility. Despite a volatile industry environment, standalone normalized EBITDA was 56 crores with a margin of 7.3%. As disclosed, normalized EBITDA excludes the one time impact of additional graduate liability under the new labor codes of approximately 2.6 crores. The sequential moderation in margins was largely driven by temporary industry factors including GST related demand difference and pricing pressure following the removal of BIS and QCO requirements.
Standalone pad for the quarter was 38.1 crore representing a margin of 5% Q3 FY26 consolidated results. On a consolidated basis, revenue increased to 1078.7 crores up 31.9% quarter on quarter. Driven by the continued ramp up of the Punjab facility and along with increased sales volume, Consolidated normalized EBITDA was 59.9 crore with a margin of 5.6% while reported EBITDA stood at 57.2 crores with a margin of 5.3%. Importantly, the Punjab facility achieved EBITDA positive performance during the quarter marking A key milestone in its commissioning journey. The consolidated pad for Q3 reflects high depreciation and higher finance costs associated with the scale up that happened at Punjab during the quarter.
For the nine months ended 12-31-2025, standalone revenue stood at 2,285 crores with normalized EBITDA of 197.3 crore. Maintaining a margin of 8.6%. Standalone PAT increased 9.1% year on year to 135.9 crores. On a consolidated basis, nine month FY26 revenues were 26.42crores up 16.6% year on year with normalized EBITDA of 192.6 crore and PAT of 55.8 crores. During the quarter we incurred one time cost of approximately 2.7 crore relating to labor code linked graduity provisions and rupees 3.5 crore towards capacity scale up at the Punjab facility. As Punjab moves closer to the full Phase 1 capacity by the end of Q4, FY26 fixed cost absorption is expected to improve supporting margin expansion and a return to positive consolidated profitability.
With improving demand visibility, FY27 should reflect the normalized earning potential of our existing Silvasa facility along with the advantage of the incremental manufacturing capacity at Punjab.
Questions and Answers:
operator
Thank you Sanjay. We are now open for Q and A. Thank you. We will now begin the question answer session. Participants who wish to ask a question may press STAR and one on your touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. We have the first question from the line of Ashish Upanglawar from InvestQ PMS. Please go ahead.
Ashish Upanglawar
Hello. Yeah, thank you so much for this opportunity. So sir, just wanted to understand in the PNDL for Q3, I mean is it possible to help us understand exactly how much impact did you have on the top line and profitability because of the tariff situation? Because I think a decent amount of our top line was to customers who export. So one is that and any other factors. I think there would be upfront costs or maybe before the commissioning there would be employee cost under cost that would have come for the Punjab facility. So in case you can help us to understand the P and L properly, what led to the drop in profitability and how much of the that would be a non recurring one and where are we going from Q4 onwards in terms of sales and profitability.
A journey. If you could help us understand till FY27 how we should visualize it.
Sammir Dattani
Yeah. Good evening. Let me take this up with the way that the cost, as you rightly pointed out, a lot of our fixed cost or majority of our fixed costs have already been taken on and Punjab and due to that because of the scaling up being slightly delayed, we are not able to utilize. We are at the moment utilizing about 60, 65% of the facility which will be ramped up in the last quarter. Once we have gone through that journey. Yes, we can see the full impact of that and all the cost including the fixed cost, the depreciation, the interest, all will after that we will be EBITDA impact positive going ahead in the first quarter itself.
Ashish Upanglawar
Okay. And on the first part how much of the sales were affected by the tariff situation?
Sammir Dattani
Yeah, as we have said earlier we our indirect Exports is about 25% and we had said about 5 to 7% of that is to the US. So yes there was some impact and more so because most of these customers were high end value purchasers. So we had to divert because the entire volume was not coming from them. We had to move to the local market and domestic market where more of the commodity play was there which impacted our margins in a certain way to some extent. But now we are back to normal and I think in the coming quarter April to June everything will be normal.
That’s why FY27 we are on course to be normal on the EBITDA as well as pat front.
Ashish Upanglawar
So sir, was there any other factor that affected the margins? Because the first two quarters we were around I think 9% plus if I can see the numbers, I think last quarter below eight and now around five and a half. So where do we go from here on the margins?
Sammir Dattani
The five and a half is on a console basis you’re talking about is the seven point. I mean the console basis because of the Punjab facility which is not ramped up for you which I explained earlier. Coming to the standalone point of view, as I explained one was this. The other impact was the QCO when the qcos were removed post the gst. So once the GST was reduced there was a halt by customer buying because of the confusion over the implementation of the new GST regime. And following that when the QCO BIS was removed then of course there was a pressure on everything that we held back on the inventory and so we lost something there.
And net to net, as I always mentioned, the QCO will not be a negative Impact on us because our raw material also will come without the qco. But the impact on our product comes immediately on the raw material. We can now see it in this quarter coming. We are getting cheaper raw material in now, in this quarter onwards.
Ashish Upanglawar
Okay. Okay. And operationally you’re not seeing any challenges to basically take up the Punjab facility to 100%. I mean it’s already acceptance by the customers as you explained in the past call.
Sammir Dattani
Yes, we don’t have any challenges there. Yes, some delay on some equipments was there. But the vendors are set it right and we are on our way to getting full productivity in the last quarter. There is no challenge on that. As far as placement of material. It has not been a challenge at all. As I told mentioned earlier what we are setting up there is hardly 20, 25% of what is already consumed there. So we have our own customer base as well as new customer base which are keen to join us as a supply person.
So we don’t see a challenge as far as that is concerned.
Ashish Upanglawar
So what will be the guidance for FY27 on the sales?
Sanjay Anirudh Shah
Yeah. So FY27 with everything put together we will be looking at a top line of close to 5,700 and a double digit EBITDA of that.
Ashish Upanglawar
Great. Thank you so much.
operator
Thank you. We have the next question from the line of MK from Harsh Mittal from MK Global Financial Services. Please go ahead.
Harsh Mittal
Hello.
operator
Harsh, your audio is a bit low. If you come closer to the microphone. Yeah. If you could go off the speakerphone once.
Harsh Mittal
Hello. Am I audible now? Is it better?
operator
This is much better. Yes.
Harsh Mittal
Yeah. Good evening sir. So see, congratulations on these business. My first question is deed A on these spreads. Spreads. So how has the spread generally compared to December? Has it improved or is flat any color on that?
Sammir Dattani
You’re talking about January compared to December, Harsh.
Harsh Mittal
Yes.
Sammir Dattani
Yeah. So January spreads have improved.
Sammir Dattani
And. Two things will impact as far as we are concerned. Two things will come into play for this quarter. One is yes, the spreads have improved compared to December. January spreads have improved across the verticals and with the enhancement of the capacity to 700 tons in Punjab over this quarter. So definitely we’ll have a much better quarter. And we should be. I mean we were pat. We are expecting our pat to be also better on a console basis. And EBITDA level is also better than the previous quarter.
Harsh Mittal
Sir. Second question in terms of mission guidance. So are we sticking to the earlier guidance of commissioning the phase two at for FY27 and the plant and quarter one roughly being the same. So I’ll be sticking to that guidance.
Sammir Dattani
No, for the second phase. Yes. FY28 we will be fully operational for the second phase of Punjab. As far as the Madhya Pradesh is concerned. We will start commence work there post the monsoons this year because we have just got the allotment of land and we have taken the control of that. But once the leveling and everything sets in and by the time we get down to ground levels there will be postponed monsoons. So we, we will be there upon running probably second half of FY28 for the MP.
Harsh Mittal
Second half of FY28 for the cotton plan and the first quarter FY28 for the phase two. Is this.
Sammir Dattani
That’s right.
Harsh Mittal
Yeah. Yeah. The third question is so has incentive started flowing for the panda plant and if it is so then what is the number for this quarter?
Sammir Dattani
Look again I didn’t follow that question.
Harsh Mittal
So my question is that had the incense started flowing in for the Polycod business and if it is so then what is the number for this quarter? Incentive for quarter three.
Sammir Dattani
Look the incentives. See we have, there is a process there. When we applied for it, they have vetted all the numbers and all the investment numbers and then we have got a certificate regarding the confirmation of the incentives. As far as actually flowing it in. Yes, it’s set to flow in this quarter.
Harsh Mittal
Fourth question being what is the current net debt and what is the foreign currency exposure to that net date as on December 21?
Sammir Dattani
Yeah.
Sanjay Anirudh Shah
Net debt at consolidated level was close to 1300 crores and the foreign debt was close to 50 million euros.
Sammir Dattani
But the entire foreign debt which is in euros has been hedged for the entire period of the debt which is 10 years.
Harsh Mittal
Okay. Okay. So last question for the evening is that what is our now in place? How do you see this panning out.
Sammir Dattani
In medium term for the EU trade pact?
Harsh Mittal
Yes sir. Yeah.
Sammir Dattani
See my personal view is that the U.S. tariff deal that we have had is going to have an impact immediately. But I think it will all start reflecting in end of first quarter FY27. And as far as the EU is concerned, I think it will still take us a few months post that before we can see the reflection of that.
Harsh Mittal
So thank you and all the best for the future.
operator
Thank you. Participants who wish to ask a question may press star and one on your touchstone telephone. We have the next question from Ryan of Sanjay Manial from DAM Capital. Please go ahead.
Ryan
Hi sir, just have few questions regarding the impact of QCO which had probably significant impact during the quarter on margins or spreads this quarter, how you see Q4 will we be able to achieve Q2 kind of a spreads or it will still be lower than that?
Sammir Dattani
No, you are right. In the third quarter, yes, the QCO did impact because as I mentioned they were following things. The GST reduction which held up movement of material and then immediately after that came the QCU removal. So there was a bit of a challenge there. But we have overcome that. And our finished products, the impact of the QCO was reflected immediately. Whereas the raw material which also comes lower post the QCO is impacted slowly which I said we get the full advantage in this quarter coming quarter. So definitely we will see a better number this quarter going forward and we will be like the QT Q2 numbers.
Ryan
Okay. Okay. So secondly on the cotton yarn front, what I am hearing from a lot of other players that margin or spreads in cotton yarn are improving. I. I believe there will be significant demand drivers also at the end of the year. What is your view on that? And does this. Can we say that if the cotton spreads really improves that simultaneously polyester spreads also sort of improves. Both go in tandem. I believe.
Sammir Dattani
Yes, you are right. The cotton spreads improved and we personally feel that yes, it’s on a good wicket and it’s going to move up further. The raw cotton prices are also more or less stable. So that’s also helping the cost. And yes, more or less every time the cotton moves up the polyester responds a little late. But it follows the track. So we expect, that’s why we expect from first quarter onwards even the polyester margins will be improved. The gross margins will improve there too.
Ryan
Right sir. And one last on the your technical textile capex. I believe you mentioned that again from Q1 only this, this, this capacity will be commissioned. So again the impact on the revenue fully will come in Q2 or will it take time to ramp up?
Sammir Dattani
No, it’s. It’s. It won’t take us time because everything will be commissioned at one go. Unlike the Punjab facility which is large and it goes in phases here it’s not that big a capacity. We are going from 9,000 to 18,000. We are doubling. Doubling. Yes. But we will be commissioning the entire facility at one go. So there won’t be any ramp up challenges like delaying the thing. Yes, we will commission first quarter FY27. So we make. We may get about half a quarter in that quarter. But the rest of the year we’ll get full revenue from that.
Ryan
Right?
Sammir Dattani
Right, sir.
Ryan
Thank you. Thank you very much, sir. And all the best for the future quarters.
operator
We have the next question from the line of Taniksht from Antique Stockbroking. Please go ahead.
Taniksht
Thank you for the opportunity. My first question is on the DGTR’s initiation on anti dumping probe around PTY inputs from China. Such dumping pressures still affecting the industry. And separately what has been the blended realization impact on your portfolio on the polyester yam post the removal of QCOs and whether the prices remain at similar levels or there has been some improvement or downward risk.
Sammir Dattani
So I, I. Can you just repeat that question of the anti dumping part? I didn’t understand it. Just repeat that.
Taniksht
So there was new news article regarding the DGPR’s initiation on anti dumping probe around PTY inputs from China. So is this dumping still affecting the industry?
Sammir Dattani
No, no. It will only help us if it comes through. But I think there are still investigations on and we have yet to see the result of that. But having said that in today’s condition hardly anything is coming there. Yes, initially when the QCO was removed a lot of material, cheaper material did flow in from China which impacted our pricing. Yes, it and the prices dropped by almost about 10 12%. But having said that post that almost 50% of that we have recovered back and we are on our way to get there.
Taniksht
So current prices are down around 6 to 7%.
Sammir Dattani
No, one more thing, that impact was only on the FTY because on DTY as such there was no QCO even before that.
Taniksht
Okay, understood. So and so the current prices are currently at similar levels or there has been some increase.
Sammir Dattani
No, after the, after the QCO came in the DTY prices remained there and it has been stable there. The FDI prices did drop once the QCO were removed. But post that there has been an improvement on the pricing again but having said that the raw material has also dropped following the QCO removal because earlier there because of QCO because nothing was coming in from China. Now raw material is also flowing in from China and that impact we will see in the first quarter again.
Taniksht
So on the gross margin side so we can see 31% around 30 31% of gross margins in 4Q and going forward quarters and yes, we are looking at that. Okay, understood. And last question. What will be the EBIT we are looking for in 4Q for consolidated EBITDA. Look up again consolidated EBITDA and revenue.
Sammir Dattani
For 4Q or Q4 you are talking about.
Taniksht
Yes, 4Q effort.
Sammir Dattani
We are looking at anything between 90 to 100 crore consolidated EBITDA.
Taniksht
Okay, 90 to 100 crores.
Sammir Dattani
Yes.
Taniksht
Okay. And revenue.
Sanjay Anirudh Shah
1200.
Taniksht
Okay.
Sammir Dattani
1200 crores or top line.
Taniksht
Okay. Understood. Thank you.
operator
Thank you. Participants who wish to ask a question may press star and one on your touchstone telephone. We have the next question from the line of Darshul Pandya from Fintrest capital. Please go ahead.
Darshul Pandya
Hello. Hi sir. Good evening. My first question would be regards to the interest and depreciation that we see. You know. I understand. You know with the new capacity that has gone live now we have seen this depreciation going up. What would be the usual run rate for next financial year for the interest and depreciation? Will this be the same of what we are seeing in this quarter?
Sammir Dattani
Yeah.
Sanjay Anirudh Shah
Similar to this quarter.
Sammir Dattani
Right.
Darshul Pandya
Okay. That goes to around 130. 140 orders of interest cost for next year.
Sanjay Anirudh Shah
Right.
Darshul Pandya
But sir, we’re guiding for 18 crores.
Sanjay Anirudh Shah
Slightly on the lower side on account of repayments which are scheduled during the course of.
Darshul Pandya
As far as I remember we were talking about 80 to 90 crores. Some kind of figures in the last quarter. Hello.
Sammir Dattani
You are asking on a console basis. You’re asking for Punjab facility.
Darshul Pandya
I am asking on the console basis, sir.
Sanjay Anirudh Shah
Okay, say. When I say interest it also includes the hedging premium which we need to pay.
Sammir Dattani
What is total interest.
Sanjay Anirudh Shah
So that that would be approximately 70 not crore in the following year.
Darshul Pandya
Okay, understood. And sir, what. What is the working capital for this nine months where.
Sanjay Anirudh Shah
The working capital is close to 1.6 for the standalone.
Darshul Pandya
Okay.
Sanjay Anirudh Shah
And the requirements of the polycord planted Punjab are very negligible.
Darshul Pandya
And just a suggestion from our centers to understand. So since our promoter holdings are 78% odd and you know we are going for some capacity expansion ahead. So will are we had. Do we have any plans to you know bring it to the minimum public sherroding and then you know deploy that money back in the company. Do we have such plans so that we do not have to go for a debt.
Sammir Dattani
As for the SEBI regulation we have to bring it down to 75%. But we have some time on that. So we will look at it as. As we go across the journey.
Darshul Pandya
Understood? Understood. For fun. Final question on this. Since you’re talking about 90200 crore EBITDA that translates to around 7.8percent of margin that we see. But from for FY27 specifically I just wanted to understand do we see this room coming to around again 9 10% EBITDA margins again.
Sammir Dattani
So as I said we are looking at a top line of about 5700 for FY27 with a double digit EBITDA on a console basis.
Darshul Pandya
Okay, understood. I’ll fall back in. Thank you so much for your time.
operator
Thank you. Partisans who wish to ask a question may press star and one on a touchstone telephone. We have the next question. Reminder. Chaitanya Doshi from Incred Equities. Please go ahead.
Chaitanya Doshi
Hello. Thank you for the opportunity. Sir, I have a question regarding CapEx. So what is the total CapEx incurred for like 9,000 MTPA technical textiles expansion at the Salvasa plant. And how has this been funded?
Sammir Dattani
For technical textile capex is about 80 odd crores. Yeah, yeah. It’s about 80 odd crores for the expansion at Silvasa.
Chaitanya Doshi
Okay. And how has this been funded? Sir, to internal. Internal. Okay. And sir, would this be like this? 80 crores will be have an impact on CAPE on the finance cost going forward.
Sanjay Anirudh Shah
Since it is internal funded? No, I don’t think it would have impacted.
Chaitanya Doshi
Okay. And sir, on the raw material cost during the quarter has PET and MEG price movements been the primary contributors? The fluctuation of the prices or something like that has been impacted.
Sammir Dattani
Yes. Yes, you’re absolutely right. The PG and MEG the fluctuation was as much as about 10% from the bottom to the top.
Chaitanya Doshi
Okay. And can you expect it to normalize in the coming quarters?
Sammir Dattani
Yes, it’s already stabilizing now and I see that by the end of this quarter it’ll be absolutely steady to downwards. I mean we don’t see raw material moving in a very big segment going forward.
Chaitanya Doshi
So we can expect a gross margin and anything around 31 odd percent in coming quarters.
Sammir Dattani
That’s right.
Chaitanya Doshi
Okay. Okay. Thank you sir.
Sammir Dattani
Thank you.
operator
Thank you. We have the next question from the line of Shruti Seth, an individual investor. Please go ahead.
Shruti Seth
Hi. Thank you for the opportunity. Just wanted to understand a few things. So could you help me with the segment wise breakup for the Q3 revenue and in terms of. And also what has led to the impact on the EBITDA margin front? That’s my first question. Second, I also wanted to understand if you could you know share some more color on the Punjab facility in terms of the capex and how the capacity is expected to ramp up. And lastly any guidance for the full year of 26 and 27?
Sammir Dattani
I will take it up this way. First I’ll answer your question about the Punjab facility. We as we mentioned we are going to be at about 700 tpd per day. That’s 700 tons per day by the end of this quarter going Forward by the end of FY27 we will be at 900 and odd tonnes per day. And the investment for that expansion is not very large because most of the work for that part of the journey has been done along with this. So it’s only a small capex, maybe about 150 crores or 125 to 150 crores which will add up to adding that additional 200 and odd tons per day.
So that’s, that’s as far as going ahead. And yes, we will be operating that 700 tons from FY first quarter, FY 26 through the year. FY 27. Sorry. So that was one part of the Punjab. The other part of the question. Can you just repeat that again please?
Shruti Seth
I also wanted to understand the guidance for 27. FY27.
Sammir Dattani
Yeah. So FY27, as I mentioned earlier, on a console basis as at a company level, we will, we are expecting to do a top line of 5700 with a double digit EBITDA.
Shruti Seth
Okay, got it. That’s it. From my side. Thank you.
operator
Thank you. Participants who wish to ask a question may press star and one on your touchstone telephone. We have the next question online of Aradna Jain from BNK Securities. Please go ahead.
Aradna Jain
Hey, thank you for the opportunity. Most of my questions have been answered. Just a couple of more things to understand. One, in the Punjab facility, the customers that you are catering to, is it fair to assume that majority of those customers are the newly added customers or is there some bit that’s flowing from the transition that’s happening from the Silvasa facility to the Punjab facility? Yes.
Sammir Dattani
Yeah. We have added a lot. Many new customers. Yes. A few of our customers who are buying from us, from Silvasa have also been. I have also moved to Punjab and thus here we are also tweaking our product portfolio and moving as we planned earlier that once we commission that fully a portion of the material that was going from here to the north will be placed in the west and on the export market.
Aradna Jain
Understood. And are we facing any operational challenges in the Punjab region given that it’s a new region for us and it’s the first full quarter where we would have serviced through that region. So any operational challenges that we would be facing?
Sammir Dattani
No, I mean as far as setting it up. Yes, the usual challenges of setting up such a big project which would have been at any other part of the country. But on the operational side we are not facing any issues at all there.
Aradna Jain
Understood. Secondly, on the raw material side, correct me If I’m wrong, on the console level, around 50, 55% of our raw material sourcing happens from foreign and the rest comes from the domestic sourcing, right?
Sammir Dattani
No, you slightly wrong over there. On the Silvasa plant, 50% of our raw material comes from abroad. Yes. At the moment in the Punjab facility, our entire raw material, the both PT and AVG are coming from the Panipat refinery of India, Indian Oil.
Aradna Jain
Understood. Yeah. So that is why I mean I was asking from a console basis and then I was going to move to Punjab.
Sammir Dattani
So from Indian oil here we are 50% on imported and 50% domestic. Once the Gale facility starts probably by the end of April May, we will maybe reduce our dependence on imported even more and come more to domestic.
Aradna Jain
Understood. And if I were to see your gross margins, like if we see how the, you know, yarn spreads have moved in the last quarter, there was a decline both on a QOQ and a YOY basis. If I just drag the yarn spread. So how much of that typically impacts us and is it the right metric to track if we were to consider the gross margin trends?
Sammir Dattani
Yes, in a way it’s the right metrics. Yes, you’re right. But having said that, I always have mentioned that this is not an industry where we can, you know, track on a quarterly basis. Yes, a six month to a 12 month window is the right way to look at us. And that’s why whenever we give indication we always say like FY27. Well, well, we are on course and we aim to do a double digit EBITDA for FY27.
Aradna Jain
Understood. Just two more questions. One, could you just help me understand what has been the realization for the technical textile front and the cotton side in 3Q?
Sammir Dattani
The exact EBITDA breakup, If that’s what your question is, I can approximately give you a revenue breakup on that.
Aradna Jain
Sure.
Sammir Dattani
So effectively on our Silvasa facility of where the top line is close to 3000 crores, we do about 400 and odd crores. Revenue comes from the cotton side in about 100 odd crores comes from the technical textiles and the balance comes from the Philippine.
Aradna Jain
Understood.
Sammir Dattani
And the Punjab facility is all from the pyramid.
Aradna Jain
Right. And just lastly on the inverted duty structure, given that the YAN PFI rates have been reduced. So is there any again operational challenges from working capital perspective that we would be facing because of that?
Sammir Dattani
Yes. I mean there are no challenges except that yes, we have a larger blockage of funds because of the larger inversion. Earlier we had an inversion from from 18 to 12. Now we have an inversion from 18 to 5. So there’s a little more money blocked. But having said that the government is also working and we are seeing that result that the refund of the inversion will be coming towards faster than it was coming earlier. But yes, there will be a little more working capital blocked on that.
Aradna Jain
Understood. And by when do we expect that the capacity utilization switch currently for Punjab is at around 60, 65 like you rightly highlighted. To reach to closer to the 100 level. Is it fair to assume like in the next six months we’ll be there?
Sammir Dattani
No. 100% level means phase one. Right. Which is 700.
Aradna Jain
Yeah. Just from the.
Sammir Dattani
We will be there before the end of this quarter.
Aradna Jain
Understood? Understood. Yeah. And lastly on the CAPEX side given that most of our capex is already done with. Try to assume that for the next years if we were to build in CAPEX numbers it should be mostly around the maintenance capex and a bit of space too.
Sammir Dattani
No. What we need on the phase to nothing on the maintenance side. What we need for the second phase because we have got our utility, our buildings, our infrastructure, everything in place, the automations, everything, the warehousing, everything is done for the entire two phases. What we are, what we need for the next phase is just a few spinning lines and a few DTY machines.
Aradna Jain
Sure. Basically I was asking that from an overall company perspective for FY27. Major CapEx will be towards the overall maintaining side. Right. Including the Silvata plant. You’re not going to expend too much on the incremental capex for any new land or machinery or anything.
Sanjay Anirudh Shah
No.
Sammir Dattani
On the Punjab facility you’re asking overall.
Aradna Jain
I said overall.
Sammir Dattani
Overall what we will be spending on not on the maintenance but what we will be spending now will be about 100 odd crores for the second phase at Punjab. And we will be doing spending about 400 and odd crores at the cotton facility for Madhya Patek. Which will be done over gradually over the period of time. And we will be moving and seeing our cash flows accordingly. We’ll be moving on that subject.
Aradna Jain
And the cotton facility will flow into our revenue numbers from FY28. Or we expect some bit to start.
Sammir Dattani
No, we will commission. We aim to commission that where the numbers will hit in the second half of FY28.
Aradna Jain
Understood? Understood. This was really helpful. Thank you. And all the best.
Sammir Dattani
Thank you.
operator
Thank you ladies and gentlemen. That was the last question. I would now like to hand the conference over to Mr. Paresh Satani for closing comments.
Sammir Dattani
Thank you. As we look ahead, our confidence is anchored in three key pillars. First, disciplined execution. Over the past few quarters we have demonstrated our ability to scale operations responsibly, manage commissioning complexity and adapt quickly to changing market and regulatory conditions. The stabilization of our Punjab facility, continued optimal operations at Silvasa and steady progress on our technical expansion reflects the strong operational foundation of built on process discipline and execution focus. Second, improving external tailwinds, the resolution of the India US Tariff issue, the opening of opportunity under the India EU Trade Agreement, supportive domestic policy measures and the rationalization of GST on fabrics collectively improve demand visibility and restore confidence across the textile value chain.
These developments are expected to support both domestic and export oriented demand and create a more predictable operating environment going forward. Third, a clear and well defined strategic roadmap. Our growth strategy remains centered on strengthening our integrated yarn platform, expanding into higher value added segments and scaling capacity in a phased and capital efficient manner. With phase one of Punjab nearing completion, visibility is on Phase two expansion of technical textile yarn capacity at Silvasa and the upcoming cotton yarn project in Madhya Pradesh. We believe we are well positioned to drive sustainable and profitable growth. Importantly, our focus remains on long term value creation through operational excellence, prudent capital allocation and a strong balance sheet management.
I would like to take this opportunity to sincerely thank our employees across all locations for their dedication and resilience, particularly during a period of industry volatility and operational scale up. I also extend my gratitude to our shareholders, customers, lenders and business partners for their continued trust and support as we execute the next phase of our growth journey. Thank you for your time and participation today. We’ll be happy to see you again.
operator
Thank you on behalf of Sunathan Textiles Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.