Damodar Industries Ltd

(Rs. In Lakhs)

The environment continued to be challenging due to a supply chain disruptions and continuous rise in commodity prices and logistics costs. The situation showed signs of improvement with gradual reduction in commodity prices in the last quarter of FY 2024-25. The Company achieved a revenue of Rs. 42,143.54 Lakhs in FY 2024-25 and a net profit of Rs. 540.17 Lakhs as against profit of Rs. 521.96 Lakhs in the previous year. The Company progressed well in deploying several mechanization across the production line, Marketing, new R&D and delivery of products to improve productivity and quality of execution.

The Board of Directors has not recommended a dividend.

Your directors inform the members that during the year under review, the operations of the Company stabilized. Your Company geared itself to face the challenges and made all efforts to continue its operations with full efficiency and vigour.

The Company has not transferred profit to the General Reserve.

Reserves and Surplus stood at to Rs. 13,232.85 Lakhs as at March 31, 2025 compared to Rs. 10,820.41 Lakhs as at March 31, 2024 .

During the year under review, there is no change in share capital of the Company.

The current policy is to have an appropriate mix of executive and independent directors. On March 31, 2025the Board consists of Six members, three of whom are executive directors or whole Time Director and Three are independent directors.

The policy of the Company on directors' appointment and remuneration including criteria for determining qualification, positive attributes independence of director and other matters as required under sub- section (3) of Section 178 of the Companies Act,2013 is available on our website www.damodargroup.com. There has been no change in the policy since the last fiscal year. We affirm that remuneration paid to directors is as per the terms laid out in the nomination and remuneration policy of the company.

Pursuant to Section 152 and other applicable provisions of the Act, and the Articles of Association of your Company, one-third of the Directors (other than Independent Directors) as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Consequently, Mr. Aman Biyani (DIN: 09131437), retires by rotation and being eligible, offers himself for re- appointment in accordance with provisions of the Act.

Pursuant to the provisions of Section 203 of the Act, the KMP's of your Company for Financial Year 2024-25 were Mr. Ajay Biyani, Managing Director of the Company Till November 19, 2024, Mr. Aman Biyani, Managing Director of the Company From November 19, 2024, Mr. Sheetal Prasad Singhal, Chief Financial Officer and Mr. Indrajit Kanase Company Secretary of the Company.

Mr. Mr. Ajay Biyani, Managing Director of the Company has resigned w.e.f. November 19, 2024 and Mr. Aman Biyani, Managing Director of the Company has appointed from November 19, 2024.

The Board of Directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings.

The Board of Directors has adopted the Insider Trading Policy in accordance with the requirement of the SEBI (Prohibition of Insider Trading) Regulations, 2015 and the Insider Trading Policy of the Company covering code of practices and procedures for fair disclosure of unpublished price sensitive information and code of conduct for prevention of insider trading is available on our website www. damodargroup.com. All Directors and Senior Management Personnel have affirmed compliance with the Code. A declaration to this effect signed by the Managing Director and Chief Financial Officer of the Company appears elsewhere in this Annual Report.

The Company has obtained the credit rating on Long Term Bank Loan facility and short term Bank Loan, from Credit Rating Agency ‘CRISIL' which is as under: (i) Rating on Long Term Bank Loan facility : ‘CRISIL BBB-/Stable' (ii) Rating on Short Term Bank Loan : ‘CRISIL A3 ' (ii) Fixed Deposit : ‘CRISIL BBB-/Stable'

(a) that in the preparation of the annual financial statements for the year ended March 31, 2025 , the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; (b) that such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2025 and of the profit of the Company for the year ended on that date; (c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) that the annual financial statements have been prepared on a going concern basis; (e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. (f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

During the year under review, neither the statutory auditors nor the secretarial auditors has reported to the audit committee, under section 143 (2) of the Companies Act,2013, any instance of fraud committed against the Company by its officers or employee, the details of which would need to be mentioned in the Board Report.

The composition and terms of reference of the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and CSR Committee have been furnished in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

M/s. Devpura Navlakha & Co., Chartered Accountants (FRN No. 121975W), has been appointed as the Statutory Auditors of the Company for the term from 35th Annual General Meeting till the conclusion of the 40th Annual General Meeting to be held in the year 2028. The Report of the Statutory Auditors along with the Notes to Schedules forms part of the Annual Report and contains an Unmodified Opinion without any qualification, reservation, disclaimer or adverse remark.

The Statutory Auditors of the Company have not reported any fraud as specified in Section 143(12) of the Act.

The Report of the Statutory Auditors along with the Notes to Schedules forms part of the Annual Report and contains an Unmodified Opinion without any qualification, reservation, disclaimer or adverse remark.

The Statutory Auditors of the Company have not reported any fraud as specified in Section 143(12) of the Act.

Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Company had appointed M/s. Pramod Jain and Co., Company Secretaries in Practice, to undertake the secretarial audit of the Company for the year 2024-25. The Secretarial Audit Report is annexed as Annexure I.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

During Financial Year 2024-25, the Company has complied with the relevant provisions of Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and General Meetings.

The Board, on the recommendation of the Audit Committee, had appointed M/s. Dilip M. Bathija, Cost Accountants (FRN No.100106) as cost auditor to conduct the audit of Company's cost records for the financial year ended March 31, 2026. The Cost Auditors have submitted their report for the year 2024-25.

The Cost Audit Report, for the year ended March 31, 2024, will file with the Central Government within the prescribed time.

In accordance with the provisions of section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, since the remuneration payable to the Cost Auditors for FY 2025-26 is required to be ratified by the shareholders, the Board recommends the same for approval by shareholders at the ensuing AGM.

As per requirements of Section 138(1) of the Companies Act, 2013 read with rule 13 of the Companies (Accounts) Rules, 2014, the Board of Directors of the Company had appointed M/s. Krishna Gandhi & Co, Chartered Accountants as Internal Auditor of the Company for the year 2024-25.

Details relating to Fixed Deposits, covered under Chapter V of the Companies Act,2013, as under:

There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

In accordance with the provisions of Sections 124, 125 and other applicable provisions, if any, of the Companies Act, 2013, read with the Investor Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as "IEPF Rules") (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), the amount of dividend remaining unclaimed or unpaid for a period of seven years from the date of transfer to the unpaid dividend account is required to be transferred to the IEPF, maintained by the Central Government. In pursuance of this, the dividend remaining unclaimed or unpaid in respect of dividends declared upto dividend for the financial year ended March 31, 2018 have been transferred to the IEPF. The details of the unclaimed dividends so transferred are available on the Company's website, www.damodargroup.com and in the website of the Ministry of Corporate Affairs at www.mca.gov.in In accordance with Section 124(6) of the Act, read with the IEPF Rules, all the shares in respect of which dividend has remained unclaimed or unpaid for seven consecutive years or more are required to be transferred to the demat account of the IEPF Authority. Accordingly, all the shares in respect of which dividends were declared upto interim dividend for the financial years ended March 31, 2018 and remained unpaid or unclaimed were transferred to the IEPF. The details of such shares transferred have been uploaded in the Company's website www.damdoargroup.com. The shares and unclaimed dividend transferred to the IEPF can however be claimed back by the concerned shareholders from IEPF Authority after complying with the procedure prescribed under the IEPF Rules. The Member/Claimant is required to make an online application to the IEPF Authority in Form IEPF -5 (available on www.iepf.gov.in)

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

2015 (Hereinafter as the "SEBI Listing Regulations"), particulars of Loans/ Advances have been disclosed in the notes to the Standalone Financial Statements, forming part of the Annual Report.

The Company has laid down Risk Management Policy. The Policy aims to identify, evaluate, manage and monitor all types of risks associated with the business of the Company. The Board as well as Audit Committee regularly overseas the risk management process in the Company, as required under 134(3)(n) of the Companies Act, 2013 and The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Your Company is operating in Textile segment and has identified certain risks which may affect the performance of the Company. These are operational risks such as fluctuation in cotton prices, fluctuation in foreign exchange rates, Labour problems and regulatory risks such as change in Government Policy with respect to Textile Industry etc. The Company's Risk Management Policy aims to suggest the steps to be taken to control and mitigate the risk associated with the Company's Textile Business. We are of opinion that none of identified risk is such that which may threaten the existence of the Company.

As required under Regulation 34(2) (e) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Management Discussion and Analysis Report is presented in a separate section forming part of the Annual Report.

The Company has established a vigil mechanism for directors and employees to report genuine concerns. The vigil mechanism provides for adequate safeguards against victimization of person who use vigil mechanism and also provide direct access to Chairman of the Audit Committee and Managing Director of the Company in appropriate and exceptional cases.

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www. damodargroup.com

As required under the above mentioned Act, we report that in the year 2024-25 no case of sexual harassment of women was filed under the said Act.

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report other than those disclosed in the financial statements.

During the year under review, no significant material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and your Company's operations. However, Members attention is drawn to the Statement on Contingent Liabilities and Commitments in the Notes forming part of the Financial Statement.

The information required under section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is given in the Annexure-II to this report.

Draft Annual Return in form MGT 7 as on March 31, 2025 is available on the Company's website at www.damodargroup.com.

The brief outline of the CSR policy of the Company and the initiatives undertaken by the Company on CSR activities during the year under review are set out in Annexure- III of this Report in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014. The CSR policy is also available on the website of your Company at http://damodargroup.com/investors/policies/ CSR_Policy_Final.pdf. For other details regarding the CSR Committee please refer to the Corporate Governance Report, which is a part of the Annual Report.

The prescribed particulars of Employee required under section 197 read with Rule 5 of the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure-IV as form the part of Boards Report.

Your Company has adopted a Remuneration Policy for the Directors, KMP, Senior Management and other employees, pursuant to the provisions of the Act and the Listing Regulations. The key principles governing your Company's Remuneration Policy and connected matter as provided in section 178(3) of the Act has been disclosed in the Corporate Governance Report which forms part of this Report. It is affirmed that the remuneration paid to Directors, KMP and all other employees is as per the Remuneration Policy of your Company. The Remuneration Policy for Directors, KMP and other Employees is uploaded on the website of your Company at http://damodargroup.com/ investors/policies/remuneration_policy.pdf.

In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has put in place a familiarization program for the Independent Directors to familiarize them with their role, rights and Responsibilities as Directors, the working of the Company, nature of the industry in which the Company operates, business model etc. The details of the familiarization program are explained in the Corporate Governance Report and are also available on the Company's website at www. damdoargroup.com.

According to Section 134(5)(e) of the Act, the term Internal Financial Control (‘IFC') means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

The Company's internal control systems are commensurate with its size and the nature of its operations. The Company has a strong and independent Internal Audit department. The Audit Committee also deliberates with the members of the management, considers the systems as laid down and meets the internal auditors and statutory auditors to ascertain their views on the internal financial control systems. Further details are provided in the Management Discussion and Analysis Report which forms a part of the Annual Report.

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

The Company has not issued any shares with differential rights and hence no disclosure is required as per provisions of Section 43(a (ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014.

The Company has not issued any sweat equity shares during the year under review and hence no disclosure is required as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014.

The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no disclosure is required as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014.

Your Directors wish to express their appreciation for the assistance and co-operation received from the Members, Banks, Government Authorities, Customers, Suppliers, Associates, Employees and Various Authorities. The directors of the Company thank all stakeholders for their valuable sustained support and encouragement towards the conduct of the proficient operation of the Company and look forward to their continued support during the year.

[Pursuant to section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014] To The Members of DAMODAR INDUSTRIES LIMITED

19/22 & 27/30, Madhu Estate, Pandurang Budhkar Marg, Worli, Mumbai 400013

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Damodar Industries Limited (hereinafter called "the Company"). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on our verification of the Company's Books, Papers, Minute Books, Forms and Returns filed and other Records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the company has, during the financial year commencing from April 1, 2024 and ended March 31, 2025 , complied with the statutory provisions listed hereunder and also that the Company has proper Board process and compliance mechanism in place to the extent, in the manner and subject to the reporting made hereinafter :

1. We have examined the books, papers, minute books, forms and returns filed and other records maintained by Damodar Industries Limited ("The Company") for the financial year ended on March 31, 2025 , according to the provisions of: i. The Companies Act, 2013 (‘the Act') and the rules made thereunder; ii. The Securities Contracts (Regulation) Act, 1956 (‘SCRA') and the Rules made thereunder; iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder; iv. Foreign Exchange Management Act, 1999 and the Rules and Regulations made thereunder to the extent of Foreign Direct Investment

(FDI) Overseas Direct Investment and External Commercial Borrowings [applicable to the extent of Foreign Direct Investment and Overseas Direct Investment]; v. The following Regulations and Guidelines, to the extent applicable, prescribed under The Securities and Exchange Board of India

Act, 1992 (‘SEBI Act'): a. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015; b. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; c. The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993, regarding the

Companies Act, 2013 and dealing with client; d. Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; e. Securities and Exchange Board of India (Investor Protection and Education Fund) Regulations, 2009; vi. Other laws applicable specifically to the Company.

2. Provisions of the following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act') were not applicable to the Company under the financial year under report: i. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2016;

ii. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008; iii. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)

Guidelines, 1999; iv. The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018; v. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018; vi. Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities ) Regulations,2021

3. We have also examined compliance with the applicable clauses of the following: i. Secretarial Standards (SS-1 and SS-2) issued by The Institute of Company Secretaries of India,; ii. SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

4. During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above.

5. We have relied on the information and representation made by the Company and its Officers for systems and mechanism formed by the Company for compliances under other applicable Acts, Laws, and Regulations to the Company.

6. We further report that: i. The Board of Directors of the Company is constituted with proper balance of Executive Directors, Non- Executive Directors and

Independent Directors. The changes in the composition of the Board of Directors that took place during the year under review were carried out in compliance with the provisions of the Act. ii. Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation of the meeting. iii. Majority decision is carried through while the dissenting members' views, if any, are captured and recorded as part of the minutes.

7. We further report that based on the review of the Compliance mechanism established by the Company and on the basis of Compliance Certificate(s) issued by the Chairman & Managing Director and taken on record by the Board of Directors at their meeting(s), we are of the opinion that there are adequate systems and processes in the Company with the size and operation of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

8. We further report that, during the audit period, there were no specific events/actions in pursuance of above referred the laws, rules, regulations, guidelines, standards, etc., having a major bearing on the company's affairs.

For PRAMOD JAIN & CO.

This Report is to be read with our letter of even date which is annexed as ‘Annexure A' and forms an integral part of this report.

To

The Members of

19/22 & 27/30, Madhu Estate, Pandurang Budhkar Marg, Worli, Mumbai 400013

Our report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the company.

4. Where ever required, we have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedures on test basis.

6. The Secretarial Audit report is neither an assurance as to future viability of the company nor of the efficacy or effectiveness with which the management has conducted the affairs of the company.

For PRAMOD JAIN & CO.

The nature of the Company's Operation entails a very High Level of Energy Consumption. However, adequate measures have been taken to conserve energy. Total energy consumption and energy consumption per unit of production:

a. Specific areas in which R & D was carried out by the Company:

The Company is actively engaged in product up gradation design development. b. Benefits derived as a result of the above R & D:

Improved product designs resulted in higher value added products and better realisations. c. Future plan of action: Emphasis on the above activities is the ongoing exercise. d. Expenditure on R & D:

Since the expenditure incurred on research and development activities were not substantial, no separate account for the same were being maintained.

Since the Company's products are being developed by an in-house R & D team, no further information under this head is required to be given.

Total foreign exchange used Rs. 113.59 ( Previous year 518.09 Lacs) and earned Rs. 21859 (Previous year 33878 Lacs).