Credit Rating- New

SANGAM (INDIA) LIMITED CIN : L17118RJ 1984PLC 003173 E - mail : secretarial@sangamgroup.com Website : www.sangamgroup.com I Ph : +91-1482-245400-06 Ref: SIL/SEC/2026 Date: 24th October, 2026 The Manager, The Manager, Department of Corporate Services, Department of Corporate Services, The National Stock Exchange of India Ltd. BSE Ltd. Exchange Plaza, 5th Floor, Phiroze Jeejeebhoy Towers, Plot No. C/1, G Block, 25th Floor, Dalal Street, Bandra Kurla Complex, Bandra (E) MUMBAI - 400 001 Mumbai – 400051 Scrip Code: 514234 Scrip Code: SANGAMIND Dear Sir/Madam, Ref.: Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 Sub.: Intimation regarding upgrade in credit ratings of bank loan facilities of Sangam (India) Limited Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that India Ratings and Research (Ind-Ra) has upgraded the long-term credit rating of the bank loan facilities of the Company from ‘IND A-’ to ‘IND A’ with a Stable Outlook and the short-term credit rating from ‘IND A2+’ to ‘IND A1’ as follows: - Instrument Type Size of Issue Rating Assigned with Rating Action (INR million) Outlook/Watch Bank loan facilities 17,650 IND A/Stable/IND A1 Upgraded Bank loan facilities 10,050 IND A/Stable/IND A1 Assigned The rating agency has upgraded the rating of bank loan facilities as amounting to ₹17,650 million and assigned a rating of ‘IND A/Stable/IND A1’ to additional bank loan facilities amounting to ₹10,050 million. The total bank loan facilities covered under the above rating actions amount to ₹27,700 million (₹2,770 crore). We are enclosing herewith the credit rating communication dated 23rd October, 2026 issued by the India Ratings and Research, Credit Rating Agency for your information and records. This above information is also made available on the website of the Company www.sangamgroup.com You are requested to take the same on record. Yours faithfully For Sangam (India) Limited Arjun Agal (Company Secretary) M. No.: A74400 Encl.: As above Registered Office : Sangam House, Atun, Chittorgarh Road, Bhilwara - 311001 (Raj.) INDIA Ind-Ra Upgrades Sangam (India)'s Bank Loan Facilities to 'IND A’/Stable/‘IND A1'; Rates Additional Limits Oct 23, 2026 | Sangam (India) Limited | Other Textile Products India Ratings and Research (Ind-Ra) has upgraded Sangam (India) Limited’s (SIL) bank loan facilities’ long-term rating to ‘IND A’ with a Stable Outlook from ‘IND A-’ and short-term rating to ‘IND A1’ from ‘IND A2+’ as follows: Details of Instruments Size of Rating Regulator of Date of Coupon Maturity Rating Instrument Type Issue (INR Assigned with Instrument Issuance Rate Date Action million) Outlook/Watch Bank loan RBI - - - 17,650 A/Stable/IND Upgraded facilities Bank loan RBI - - - 10,050 A/Stable/IND Assigned facilities Analytical Approach To arrive at the rating, the agency continues to take a fully consolidated view of SIL and its 100% subsidiary, Sangam Ventures Limited (SVL), as the companies are in the same line of business and operate under the same management. Detailed Rationale of the Rating Action The upgrade reflects the improvement in SIL's operational performance over FY26-1QFY27 which is likely to be sustained over the medium term, driven by the incremental cost-effective measures implemented by the company mainly pertaining to savings in power cost and higher backward integration. The company's captive renewable sources cater to 30% of the total power requirement at present and the management expects to increase it to 70% in the next nine months, leading to a total power savings of INR700 million. SIL’s acquisition of RPSF in FY26 is likely to result in INR150 million of input cost savings. SIL's consolidated EBITDA margins improved to 12.2% in 1QFY27 (FY26: 9.9%; FY25: 8.6%), driven by operating leverage and cost optimisation measures. The ratings also reflect the decline in the net leverage (including letter of credit (LC) acceptances) to 3.04x in 1QFY27 (FY26: 3.62x; FY25: 3.38x), largely due to the improvement in profitability despite an increase in debt following its debt- funded capex and higher working capital borrowings. Ind-Ra also observes a decline in the net leverage (including e-trade and LC acceptances) to 4.01x in 1QFY27 (FY26: 5.14x; FY25: 6.26x). The company plans to undertake capex of INR15,000 million over the next three financial years, aiming at increasing renewable energy capacity, expansion in cotton yarn, and automation in cotton and polyester viscose (PV) yarn segment. Although company plans to enter into denim garmenting, it is at initial stages of discussions. SIL's board has approved the issue of share warrants of INR1,000 million, of which INR250 million has been received in 2QFY27. Even though the agency expects the net leverage to be at elevated levels, it will be below Ind-Ra’s earlier expectation and will continue to moderate on yoy basis over the medium term even after sizable capex, due to the likely benefit from the ongoing capex and cost optimisation, leading to a healthy and sustained business performance. The ratings also factor the financial flexibility and support received from promoters over FY26-FY27 to support capex. However, the ratings are constrained by the above-mentioned debt-funded capex undertaken since this will keep the net leverage (including acceptances) at elevated levels over FY27-FY28; nevertheless, the agency expects the net leverage to remain comfortable during the period before falling below 3.5x FY29 onwards. The coverage indicators are likely to remain comfortable with an interest coverage ratio of more than 3.0x over the medium term. List of Key Rating Drivers Strengths Operational performance improved in 1QFY27, further improvement likely Improved credit profile Diversified business profile Weaknesses High debt-funded capex Forex risks Detailed Description of Key Rating Drivers Operational Performance Improved in 1QFY27, Further Improvement Likely: Ind-Ra expects the consolidated operating performance to continue improving in FY27-FY28, supported by capacity enhancement, ongoing cost-efficiency initiatives, healthy demand from downstream segments, and a sustained focus on value-added products. SIL’s sales remain primarily order backed, with a two-month order book, ensuring near-term revenue visibility. Its exports contributed 36% to the consolidated revenue in FY26 (FY25: 39%; FY24: 33%), reflecting a continued customer base expansion across geographies. The consolidated revenue improved to INR32,345 million in FY26 (FY25: INR28,570 million; FY24: INR26,281 million), aided by improved volumes and realisations across yarn, PV fabric and garments. The consolidated EBITDA margins improved to 9.9% in FY26 (FY25: 8.6%; FY24: 8.2%), supported by improved spreads and a sustained contribution from value-added products such as fabrics and garments, accounting for around 50% of the total revenue (FY25: 50%; FY24: 53%). In 1QFY27, the company recorded revenue of INR8,603 million and EBITDA margin of 12.2%. As part of its strategic backward integration strategy, the company acquired a recycle polyester staple fibre (RPSF) unit in October 2025, which is likely to yield annual cost savings of INR140 million-150 million. Furthermore, continuous renewable power investments are likely to generate annual savings of around INR700 million in the near to medium term. Improved Credit Profile: SIL’s capital structure remained broadly stable over FY23-FY26, with the gross debt (including acceptances)-to-equity ratio at 1.19x in FY26 (FY25: 1.13x; FY24: 1.08x). However, total gross debt (including LC acceptances) increased to INR13,398 million (INR11,970 million; INR11,129 million), reflecting debt-funded capex and higher working capital borrowings. The net leverage (net debt including LC acceptances/operating EBITDA) reduced but remained elevated at 3.62x in FY26 (FY25: 3.38x; FY [Showing first 8,000 characters — download PDF for full document]