PDS Limited Proposes Secondary Acquisition of Remaining 7% Stake in Hong Kong Subsidiaries

PDS Limited has announced its intention to acquire the remaining 7% equity stake in two key Hong Kong subsidiaries through a proposed secondary acquisition. The company currently holds 93% equity stake in both GoodEarth Lifestyle Limited, Hong Kong and Progress Manufacturing Group Limited, Hong Kong through its step-down subsidiaries.

Acquisition Structure and Approval

The proposed acquisition involves purchasing the remaining 7% equity stake from existing shareholders in both subsidiaries. The transaction was approved on March 30, 2026, with necessary transfer documents executed and filed with relevant regulatory authorities in Hong Kong.

Parameter: Details Current Stake: 93% each Stake to be Acquired: 7% each Target Ownership: 100% Consideration: USD 2 (₹188 equivalent) Regulatory Jurisdiction: Hong Kong

Subsidiary Financial Performance

Both subsidiaries operate in the textiles and apparels sector with significant revenue contributions. The consolidated financial performance shows strong revenue generation across both entities.

Financial Metrics (March 31, 2025): GoodEarth Lifestyle Limited Progress Manufacturing Group Limited Consolidated Turnover: ₹337.00 crore ₹450.93 crore Consolidated PAT: ₹11.02 crore ₹14.31 crore Standalone Turnover: ₹87.93 crore ₹215.32 crore Standalone PAT: ₹(4.25) crore ₹(7.30) crore

Strategic Rationale

The proposed acquisition aims to simplify the shareholding structure and consolidate ownership across both subsidiaries. Additionally, the transaction will facilitate the implementation of Employee Stock Options Plan for the management team at the overall manufacturing holding level under PDS Limited.

Historical Performance

Both subsidiaries have demonstrated consistent revenue performance over the past three years, with consolidated turnover showing growth trends across multiple financial periods.

Consolidated Turnover History: GoodEarth Lifestyle Progress Manufacturing FY2024-25: ₹337.00 crore ₹450.93 crore FY2023-24: ₹234.84 crore ₹365.23 crore FY2022-23: ₹297.06 crore ₹416.72 crore

The acquisition represents a related party transaction conducted on an arm's length basis, with no additional interest from promoters or promoter group companies in the entities being acquired.

PDS Limited has incorporated a new wholly owned subsidiary, PDS Global Sourcing Limited, effective March 20, 2026. The incorporation was announced through a regulatory filing under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Subsidiary Details and Investment

The company has made a strategic investment in the new subsidiary through cash consideration. The investment details are structured as follows:

Parameter: Details Entity Name: PDS Global Sourcing Limited Date of Incorporation: March 20, 2026 Country of Incorporation: India Shareholding: 100% Share Subscription: 5,00,000 equity shares Face Value per Share: INR 2.00 Total Investment: INR 10.00 lakh Nature of Consideration: Cash

Business Focus and Operations

PDS Global Sourcing Limited will operate in the textiles and apparels industry. The subsidiary has been established with comprehensive business objectives aimed at strengthening PDS Limited's market presence. The primary goal involves establishing a comprehensive presence in the textile industry through multiple operational channels.

The subsidiary's business strategy encompasses:

Manufacturing, processing and trading of garments, textiles, fibres, and yarns

Expanding reach across domestic and international markets

Operating through retail, wholesale, and e-commerce channels

Enhancing value, profitability, and operational efficiency

Regulatory Compliance

The incorporation has been completed in accordance with regulatory requirements, with no specific governmental or regulatory approvals needed for the establishment. The disclosure has been made pursuant to Schedule III of the SEBI Listing Regulations and SEBI Circular No. SEBI/HO/CFD/PoD-2/CIR/P/2024/185 dated December 31, 2024.

Strategic Significance

The establishment of PDS Global Sourcing Limited represents a strategic expansion initiative for PDS Limited in the textiles sector. The wholly owned subsidiary structure provides complete operational control while enabling focused business development in manufacturing, processing, and trading activities across multiple market channels.

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