Vedant Poly Fabs Limited’s related-party ratio fell in FY26

Vedant Poly Fabs Limited reported Rs 31.8108 crore of related-party transactions in FY26, equal to 27.63% of Rs 115.1391 crore in revenue from operations. The ratio fell from 40.72% in FY25 because transaction value declined slightly while revenue increased, although FY26 disclosures included substantial sales and a Rs 15.87 crore related-party loan converted into equity.

How large was Vedant Poly Fabs’ related-party ratio in FY26?

Vedant Poly Fabs’ related-party ratio was 27.63% in FY26, down from 40.72% in FY25 but above 7.85% in FY24. The company calculates the measure as the sum of all related-party transactions divided by revenue from operations, using disclosures under Accounting Standard 18, or AS 18, for related-party disclosures.

The lower FY26 ratio resulted from two movements: related-party transactions fell by Rs 1.1841 crore from FY25, while revenue rose by Rs 34.1179 crore. The three-year trend was not uniform, as the transaction total increased from Rs 3.8909 crore in FY24 to Rs 32.9949 crore in FY25 before easing to Rs 31.8108 crore in FY26.

Revenue expanded in each reported year, from Rs 49.5346 crore in FY24 to Rs 81.0212 crore in FY25 and Rs 115.1391 crore in FY26. For the FY26 related-party ratio to remain below the FY25 level on the same basis, related-party dealings would need to grow more slowly than revenue, or decline, because the ratio includes operating and financing transactions rather than sales alone.

Which related parties drove the disclosed dealings?

Vedant Poly Fabs disclosed dealings with directors, key management personnel and entities in which key management personnel or their relatives could exercise significant influence. The named entities include Sethswaria Poly Fab LLP, Lakhotia Packwell Private Limited, JMV Polyver Limited and Pankaj Maheshwari (HUF), or Hindu Undivided Family; the transaction tables label the LLP counterparty as Sethsawariya Poly Fab LLP.

The LLP was the largest identified FY26 counterparty by the individual operating and funding amounts shown in the tables. Vedant Poly Fabs reported Rs 14.7993 crore of FY26 sales to Sethsawariya Poly Fab LLP, Rs 47.38 lakh of purchases from it and a Rs 15.87 crore loan taken from it. The sales figure exceeded the company’s Rs 47.38 lakh of purchases from the same LLP during FY26.

Lakhotia Packwell Private Limited was the more prominent disclosed operating counterparty in FY25. Vedant Poly Fabs reported Rs 18.4254 crore of purchases from Lakhotia Packwell, Rs 2.124 crore of machinery purchases and Rs 1.5813 crore of sales in FY25. The purchase entry carried a closing balance of Rs 17.2393 crore, while the machinery-purchase entry had Rs 2.124 crore outstanding at March 31, 2025.

Those FY25 balances are not additional annual transactions. The disclosure separates activity during a financial year from the amount outstanding at the reporting date, so Rs 18.4254 crore of purchases and Rs 17.2393 crore of closing balance measure different accounting items. No Lakhotia Packwell purchase or sales transaction for FY26 appears in the supplied related-party tables.

How did the Rs 15.87 crore related-party loan become equity?

Vedant Poly Fabs converted the Rs 15.87 crore FY26 loan taken from Sethsawariya Poly Fab LLP into equity share capital. The loan table records Rs 15.87 crore as the amount taken, no cash repayment, the same Rs 15.87 crore as conversion to equity share capital, and no closing loan balance at March 31, 2026.

A loan-to-equity conversion replaces a liability with equity share capital in the stated accounting record. This means the FY26 related-party aggregate includes a capital-structure transaction as well as purchases, sales, director remuneration and reimbursements. The company’s 27.63% ratio therefore cannot be read solely as dependence on related parties for buying materials or selling packaging products.

The earlier disclosures also record conversions. In FY25, Rs 44.04 lakh of the loan involving Pankaj Kumar Maheshwari was converted into equity, while Rs 7.0026 crore of the LLP’s purchase-related balance was converted into equity. In FY24, the tables show loan conversions of Rs 25 lakh for the LLP, Rs 12.75 lakh for Sujata Maheshwari and Rs 19.50 lakh for Anil Kumar Maheshwari.

What other FY26 transactions and balances were reported?

Vedant Poly Fabs reported director remuneration of Rs 11 lakh each to Sujata Maheshwari, Pankaj Kumar Maheshwari and Sunil Bihani in FY26, and Rs 6 lakh to Anil Kumar Maheshwari. It also recorded Rs 63.30 lakh of expense reimbursement to Lakhotia Packwell and Rs 4.24 lakh to Sethswaria Poly Fab LLP during FY26.

The FY26 sales table for Sethsawariya Poly Fab LLP shows a negative opening balance of Rs 96.59 lakh, receipts of Rs 14.2845 crore and a negative closing balance of Rs 45.11 lakh. Its purchase table shows a negative opening balance of Rs 96.44 lakh, Rs 47.38 lakh of purchases, Rs 30,000 paid and a negative closing balance of Rs 49.36 lakh. The disclosure does not explain the commercial reason for the negative balances.

The company stated that it had not provided loans, advances or guarantees to related parties in FY26, FY25 or FY24. However, the detailed table records an FY26 advance given of Rs 23,000 to Pankaj Maheshwari (HUF), with a closing balance of Rs 23,000. The supplied disclosure does not reconcile the general statement with that table entry.

What does Vedant Poly Fabs say about future related-party dealings?

Vedant Poly Fabs stated that its transactions with promoters, directors and promoter-group entities complied with Section 188 of the Companies Act, 2013 and other applicable rules. Section 188 governs specified related-party contracts and arrangements, while the company said it believed its transactions were conducted on an arm’s-length basis, meaning terms intended to reflect dealings between unrelated parties.

The company also stated that it could not assure investors that it would not have obtained more favourable terms if the dealings had not been with related parties. This qualification is material because the FY26 total of Rs 31.8108 crore included both trading flows and the Rs 15.87 crore loan converted into equity, rather than a single class of transaction.

Vedant Poly Fabs said it was likely to continue related-party transactions and could enter into future loans, advances or guarantees for business requirements, subject to required Companies Act approvals. The disclosure provides no numerical cap, planned value or forecast for future related-party activity, so subsequent filings would be needed to assess whether the FY26 ratio persists.

Conclusion

Vedant Poly Fabs reduced the share of revenue represented by related-party transactions to 27.63% in FY26 from 40.72% in FY25, as revenue rose by Rs 34.1179 crore and the reported transaction total declined by Rs 1.1841 crore. Yet the FY26 amount remained substantial and combined Rs 14.7993 crore of sales to an LLP counterparty with a Rs 15.87 crore loan converted into equity.

The next disclosure to watch is whether Vedant Poly Fabs continues transactions with Sethsawariya Poly Fab LLP, Lakhotia Packwell and other named related parties, particularly funding or equity conversions. The company has disclosed that related-party transactions may continue and that future loans, advances or guarantees may be used for business requirements subject to necessary approvals, but it has not set out a quantified future plan.