Escorts Kubota Ltd

Dear Members,

Your Directors have pleasure in presenting this Integrated Annual Report/ Annual Report ('IAR'/ 'AR') of the Escorts Kubota Limited ('Escorts' or 'EKL' or 'Company') along with the Company's audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2025.

( crores)

The brief highlights of the Company's performance (Standalone) for the financial year (‘FY') ended March 31, 2025 are:

10,645.35 crores

Total income of the Company for FY 2024-25 stood at

10,645.35 crores ( 10,122.22 crores in FY 2023-24)

1,636.23 crores

Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at 1,636.23 crores.

1,366.59 crores

Profit from operations before Tax (PBT) and exceptional items stood at 1,366.59 crores. Net profit for the period stood at 1,250.92 crores.

Our Company sold 1,15,554 tractors during the year under review as against 1,14,396 tractors sold during the last financial year.

The brief highlights of the Company's performance (Consolidated) for the financial year ended March 31, 2025 are:

• Total income of the Company for FY 2024-25 stood at

10,705.19 crores ( 10,195.37 crores in FY 2023-24)

• Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at 1,625.50 crores.

• Profit from operations before Tax (PBT) and exceptional items stood at 1,352.68 crores. Net profit for the period stood at 1,264.95 crores.

*The figures of last financial year ended on March 31, 2024 have been restated giving the impact of scheme of amalgamation among and between Escorts Kubota India Private Limited, Kubota Agricultural Machinery India Private Limited with the Company, as approved by the Hon'ble National Company Law Tribunal ('NCLT'), Chandigarh Bench, vide its order dated August 21, 2024.

The details on the individual businesses of the Company are provided in the Management Discussion & Analysis section provided in this annual report.

In terms of the provisions of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the 'SEBI Listing Regulations'), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

During the FY 2024-25, the Board of Directors of the Company at its meeting held on February 10, 2025 has declared the interim dividend @ 100% per share of face value of 10/- each (i.e. 10/- per share) for the financial year ended March 31, 2025 and the record date for the purpose of interim dividend was February 14, 2025.

Further, based on the Company's performance, your Directors are pleased to recommend, for approval of the members, the final dividend @ 180% per share of face value of 10/- each (i.e. 18/- per share) for the financial year ended March 31, 2025, payable on all outstanding shares after deducting applicable tax thereon.

The dividend payout is subject to the approval of members at the ensuing Annual General Meeting ('AGM').

The record date for the purpose of dividend will be July 04, 2025.

The total dividend for the FY ended March 31, 2025 works out to 280% per share of face value of 10/- each (i.e. 28 per share).

The dividend payout for the period under review has been formulated in accordance with shareholders' aspirations and the Company's Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

The dividend distribution policy is available on the following web link https://www.escortskubota.com/new/pdf/reg-46-sebi/24-02-2025/2024_05_09_Dividend-Distribution-Policy. pdf.

During the financial year ended March 31, 2025, no amount (previous year: nil) transferred to general reserves.

Further, the movement in Reserves and Surplus is provided in note 17 of standalone and note 18 of consolidated financial statements.

The Escorts Employees Stock Option Scheme ('ESOS') is in line with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ('SEBI SBEB Regulations'). The other details pertaining to the ESOS are provided in note 38 of the Notes to Accounts of Standalone Financial Statement of the Company.

The Scheme is being implemented in accordance with the SEBI SBEB Regulations and the resolution(s) passed by the members. The Secretarial Auditors Certificate would be available during the Annual General Meeting for inspection by the members. The details as required to be disclosed under the Companies Act, 2013 (hereinafter referred as "the Act") and/ or SEBI SBEB Regulations would be available on weblink at https://static.escortskubota.com/images/other-documents/2025/EKL_2025_05_08_ESOP_Disclosure_ Reg_14.pdf

During the FY 2024-25, the Company allotted 13,79,493 Equity Shares of nominal value 10/- each, pursuant to the Scheme of Amalgamation ('Scheme')among and between Escorts Kubota India Private Limited, Kubota Agricultural Machinery India Private Limited with the Company as approved by Hon'ble NCLT, Chandigarh Bench vide its order dated August 21, 2024. Consequently, the paid-up equity share capital of the Company, after said allotment, stood at 1,11,87,77,540/- consisting of 11,18,77,754 equity shares of 10/- each. Further, pursuant to the Scheme, the authorised share capital of the Company increased to 16,39,00,00,000/- (Rupees one thousand six hundred and thirty-nine crores only) consisting of 75,10,00,000 (Seventy five crore and ten lakh) Equity Shares having face value 10 (Rupees Ten only) each and 88,80,00,000 (Eighty eight crore and eighty lakh) unclassified shares of 10/- (Rupees Ten only) each.

Your Directors have pleasure to inform you that the during the FY 2024-25, the Scheme of Amalgamation ("Scheme") among and between Escorts Kubota India Private Limited, Kubota Agricultural Machinery India Private Limited with the Company, under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 and the rules framed thereunder, has been approved by the NCLT, Chandigarh Bench, vide its order dated August 21, 2024.

Accordingly, the Scheme became effective w.e.f. September 01, 2024 i.e. upon filing of said NCLT Order with Registrar of Companies, NCT of Delhi & Haryana.

In line with Company's strategic focus on the agri and construction equipment sectors and aligning with the vision of the parent company i.e. Kubota Corporation, the Company has executed the Business Transfer Agreement with Sona BLW Precision Forgings Limited ('Sona Comstar') on October 23, 2024 for transferring the existing Railway Equipment Business Division ('RED') as going concern, on slump sale basis, for a lumpsum cash consideration of 1,600 crores (Indian Rupees One Thousand and Six Hundred crores Only), without values being assigned to the individual assets and liabilities.

Further, on February 10, 2025 the Company has entered into an amended and restated business transfer agreement with Sona Comstar to amend certain terms and conditions of the initial agreement including revision in expected date of completion of sale/ transfer of RED Business from September 30, 2025 to May 01, 2025.

Further, the Company has also entered into an agreement to sell with Sona Comstar on February 10, 2025 for the sale/ transfer of the Company's spare part division land and building measuring 33,423 (Thirty three thousand four hundred twenty three) square yards equivalent to 27,945.885 (Twenty seven thousand nine hundred forty five point eight eight five) square meters, forming part of the RED division industrial plot bearing no. 115 and half of plot no. 114 located in Sector 24, Faridabad, Haryana for a total sale consideration of 110 crores (Indian Rupees One Hundred and Ten crores only). Further, pursuant to sale of land to Sona Comstar, the Company has shifted its operations pertaining to spare part division business from Sector 24, Faridabad, Haryana to Apeejay Global Industrial & Logistics Park, Building No. 09 (Shed No. 2.3), 23 / 5 Milestone, Delhi Mathura Road, Ballabhgarh, Haryana – 121004.

During the FY 2024-25, the fund of 1,041.903 crore raised on a preferential basis on July 16, 2020 has been fully utilised for the purpose for which it was raised i.e. inter-alia for the Agri Machinery Business of the Company and there has been no deviation or variation in utilisation of this fund.

Further, the details of utilisation of funds of 1,872.745 crore raised on February 18, 2022 on a preferential basis, as on March 31, 2025, are as follows:

*Net proceeds post deduction of expenditure of 17.440 crores incurred towards preferential issue and allotment.

In accordance with the provisions of the Companies Act, 2013 (hereinafter referred as 'the Act') and Articles of Association of the Company, Mr. Bharat Madan (DIN: 00944660) and Ms. Nitasha Nanda (DIN: 00032660) Directors of the Company, retire by rotation at the ensuing AGM and being eligible, offer themselves for re-appointment. The shareholders at the AGM held on July 18, 2024, had appointed Mr. Sunil Kant Munjal (DIN: 00003902) and Ms. Tanya Arvind Dubash (DIN: 00026028) as Independent Directors for second term for 5 years and Mr. Kinji Saito (DIN: 00049067) as an Independent Director for a term for 5 years in place of Mr. Kenichiro Toyofuku (DIN: 08619076), who had resigned due to his preoccupation in other professional assignment. The resignation letter of Mr. Toyofuku states that there is no material reason other than the reason stated in the resignation letter. The shareholders at AGM held on July 18, 2024, had also reappointed Ms. Nitasha Nanda as Whole-time Director for a further period of 3 year.

Further, the tenure of Mr. Harish Narinder Salve (DIN: 01399172), Independent Director is going to end on July 15, 2025 i.e. completing his first term. The Board of Directors, on recommendation of Nomination, Remuneration and Compensation Committee ('NRC'), in their meeting held on May 08, 2025 had recommended the re-appointment of Mr. Salve as an Independent Director for second term for 5 years for approval of members of the Company as a special resolution at the ensuing AGM.

Mr. Vicky Chauhan, Compliance Officer of the Company has resigned w.e.f. February 10, 2025 due to his pre-occupancy and in his place Mr. Arvind Kumar, Company Secretary and Key Managerial Personnel of the Company, has been appointed as a Compliance Officer of the Company w.e.f. February 10, 2025.

The Company has received declarations from all Independent Directors of the Company that they meet the criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulations 16 and 25 of SEBI Listing Regulations and there has been no change in the circumstances affecting their status as independent directors of the Company. The Company has also received a declaration from all the independent directors that they have registered their names in the independent director data bank and pass/ exempt requisite pro_ciency test conducted by Ministry of Corporate Affairs.

In the opinion of the Board, the Independent Directors of the Company are the persons of integrity, expertise and fulfil the conditions as per the applicable laws and are independent of the management of the Company.

The Board at its meeting held on February 10, 2025 has reviewed and made requisite amendment(s) in the Policy on Appointment and Removal of Director's and Members of Senior Management. The Policy on Appointment and Removal of Director's and Members of Senior Management and Remuneration Policy for Director's, Key Managerial Personnel, Senior Management and other Employees are enclosed as Annexure A and Annexure B respectively and forms an integral part of this Report.

Annual performance evaluation of the Board, its committees, individual directors (including independent directors) and Chairman of the Company pursuant to the provisions of the Act and the Corporate Governance requirements under SEBI Listing Regulations have been carried out in accordance with the Policy. The process, and result of performance evaluation given in Corporate Governance Report, was followed by the Board for evaluation of its own performance and its committees and individual directors including independent directors and Chairman of the Company.

The Company has devised a process whereby various presentations/ programmes are being conducted to familiarise the directors with various developments at industry level, new business initiatives and organisation strategies, policy on Business Responsibility & Sustainability etc. The details of programme for familiarisation of independent directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company – https://www. escortskubota.com/investors/regulation-46-of-sebi.

The Company recognises and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help it retain its competitive advantage.

The brief resumes, rationales and justifications wherever applicable and other details relating to the director who are proposed to be appointed/ re-appointed, as required to be disclosed as per the provisions of the SEBI Listing Regulations/ Secretarial Standard are given in the Annexure to the Notice of the 79th AGM.

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are enclosed as Annexure C and forms an integral part of this Report.

Corporate Governance is about maximising shareholders value, ethically and sustainably. At Escorts Kubota the goal of corporate governance is to ensure fairness for every stakeholder. Your Company believes that strong corporate governance is critical to enhancing and retaining investor trust. Your Company also endeavours to enhance long term shareholder value and respect minority rights in all its business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Business Conduct which has set out the systems, processes and policies conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report alongwith a Certificate regarding compliance of conditions of Corporate Governance from Company Secretary in Practice are enclosed as Annexure D and forms an integral part of this Report. Further, other governance related disclosures are available on the website of the Company at https://www.escortskubota. com/investors/governance.

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities. The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act. The CSR Policy may be accessed on the Company's website at https://www.escortskubota.com/investors/governance. During the year, the Company has spent 11.72 crores out of total CSR obligation of 17.85 crore for FY 2024-25. Further, the remaining balance 6.13 crore has been deposited in a separate account in compliance of Section 135(6) of the Act, which is attributable to ongoing projects conceived during the financial year. Further, other details are provided in note 29 of the standalone financial statement.

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance enclosed as Annexure D to this Report.

The Annual Report on CSR activities, which include the salient features of the CSR Policy and change therein, if any, is enclosed as Annexure E and forms an integral part of this Report.

The Consolidated Financial Statement have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 110 applicable to the Consolidated Financial Statement read with IND AS - 28 on Accounting for Investments in Associates and IND AS - 31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statement along with the Auditors' Report thereon are annexed with Annual Report

In accordance with Section 129(3) of the Act, a statement containing salient features of the financial statements of the subsidiary(ies), joint venture(s) and associate(s) companies in Form AOC - 1 is provided in this Report. The statement also provides details of performance and financial position of each of the subsidiaries, joint venture(s) and associates and their contribution to the overall performance of the Company during the period under report. Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at https://www.escortskubota. com/investors/regulation-46-of-sebi/subsidiary-financial-statements. The Consolidated Financial Statement presented by the Company include the financial results of its subsidiaries and associate companies.

In terms of the Company's Policy on determining 'material subsidiary', during the financial year ended March 31, 2025, there is no material subsidiary of the Company whose turnover or net worth exceeds 10% of the consolidated turnover or net worth respectively of the Company and its subsidiary in the immediately preceding Accounting Year. Further, during the FY 2024-25, there is no cessation of any subsidiary, joint ventures or associate except Escorts Kubota India Private Limited and Kubota Agricultural Machinery India Private Limited, joint ventures companies, which have been merged with the Company pursuant to scheme of amalgamation as approved by the Hon'ble NCLT, Chandigarh Bench, vide its order dated August 21, 2024.

Further, during the FY 2024-25, Escorts Kubota Finance Limited, wholly-owned subsidiary company of the Company has commenced its business as a non-banking financial institution without accepting public deposits with effect from November 26, 2024.

The complete list of subsidiaries, joint ventures and associate companies as on March 31, 2025, in terms of the Act and/ or IND-AS is provided herein below:

The details of the above investments/ disinvestment are provided in note 7 of the Notes to Accounts of Standalone Financial Statement of the Company.

During the FY 2024-25, the Company has made total downstream investment of 40 crores to subscribe equity shares offered under right issue(s) by Escorts Kubota Finance Limited, wholly-owned subsidiary company of the Company, in compliance with the applicable provisions of the laws, rules and regulations. Further, the requisite filing/ intimation and auditor's certificate in this regard have been dully completed.

All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on the materiality of related party transactions and dealing with related party transactions.

The particulars of contracts or arrangements, with related parties referred to in Section 188(1) of the Act, in the prescribed Form AOC-2, is enclosed as Annexure F to this report and forms an integral part of this Report.

The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company's website at https://www.escortskubota.com/ investors/regulation-46-of-sebi.

Your Directors draw attention of the members to note 46 in the notes to accounts in the standalone financial statement and to note 47 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Pursuant to the provisions of Section 139 of the Act read with rules thereunder, the shareholders of the Company at the 76th AGM held on July 14, 2022 had re-appointed M/s. Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2027.

The comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors, in their report read together with notes to Accounts for the FY ended March 31, 2025 are self-explanatory and hence, do not call for any further explanations or comments under Section 134 of the Act.

Pursuant to provisions of the Section 143(12) of the Act neither the Statutory Auditors nor Secretarial Auditors nor Cost Auditors have reported any incident of fraud to the Audit Committee or the Board during the FY under review.

Pursuant to the Section 148 of the Act read with rules thereunder, your Company is required to maintain the cost records and the said cost records are required to be audited. The Company is maintaining all the aforesaid cost records. The Board of Directors, on the recommendation of Audit Committee, has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants (Firm Registration No. 000019), as Cost Auditors of the Company for conducting the audit of cost records for the FY 2025-26.

The due date of filing the Cost Audit Report for the year ended on March 31, 2024 was September 30, 2024 and the same had been filed on August 29, 2024.

The Board had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries, as Secretarial Auditors to conduct secretarial audit of the Company for the FY 2024-25. However, due to the casual vacancy in the office of Secretarial Auditors, upon sudden demise of Mr. Jayant Gupta, sole proprietor of M/s. Jayant Gupta and Associates on November 12, 2024, M/s. Neelam Gupta & Associates has been appointed as Secretarial Auditors of the Company for the FY 2024-25, to hold the office of the Secretarial Auditors up to the conclusion of AGM to be held in the year 2025. The Secretarial Audit Report of the Company as prescribed under Section 204 of the Act is enclosed herewith as Annexure G and forms an integral part of this Report. The Secretarial Audit Report does not contain any qualification, reservation and adverse remarks and the comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further explanations or comments under Section 204(3) of the Act.

Further, the Board at its meeting held on May 08, 2025, on the recommendation of Audit Committee, has recommended the appointment, of M/s. Neelam Gupta & Associates, (Firm Registration No. S2006DE086800), a peer reviewed firm of Practicing Company Secretaries as Secretarial Auditors of the Company for a term of 5 consecutive years from the conclusion of the ensuing AGM till the conclusion of the AGM to be held in the year 2030, to the shareholders of the Company for their approval. The Company has received a letter from M/s. Neelam Gupta & Associates, Practicing Company Secretaries confirming that their appointment, if made, would be within the limits prescribed under SEBI Listing Regulations and that they are not disqualified for such appointment under the Act and SEBI Listing Regulations.

There is no material unlisted Indian subsidiary of the Company as on March 31, 2025 and as such the requirement under Regulation 24A of the SEBI Listing Regulations regarding the Secretarial Audit of material unlisted Indian subsidiary is not applicable to the Company for FY 2024-25.

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company's enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, operational, sectoral, credit, market, liquidity, security, property, information technology, sustainability, cyber security, legal, regulatory, reputational and other risks have been identified and assessed and in the opinion of the Board there is an adequate risk management infrastructure in place capable of addressing and mitigating those risks.

The Company has laid down a Risk Management Policy and the same is available on the website of the Company at https://www.escortskubota.com/investors/governance. The details of constitution of Risk Management Committee of the Company is provided in Report on Corporate Governance at Annexure D of this Report.

The Board has adopted policies and procedures 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 fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls including with reference to financial statement and for ensuring the orderly & efficient conduct of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Six meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance enclosed as Annexure D to this Report.

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance enclosed as Annexure D to this Report.

All the recommendations made by the Audit Committee were accepted by the Board.

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance enclosed as Annexure D to this Report.

The Annual Return for FY 2024-25* is available on the weblink at https://static.escortskubota.com/images/other-documents/2025/EKL_2025_03_31_Form_MGT_7.pdf *Ensuing AGM related information i.e. attendance etc. will be updated after AGM.

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct. The mechanism provides for adequate safeguards against victimisation of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Whistle Blower Policy is available on Company's website at https://www.escortskubota.com/investors/governance. The Board has also adopted the Anti-Bribery Policy and the same is available on Company's website at https://www. escortskubota.com/investors/governance.

The share transfer and related activities are being carried out by M/s. KFin Technologies Limited, Registrar and Share Transfer Agent from the following address: M/s. KFin Technologies Limited Selenium Building, Tower B, Plot No. 31-32, Financial District, Nanakramguda, Serilingampally, Hyderabad, Rangareddy, Telangana - 500032

A statement regarding Loans/ Guarantees given and Investments made and Securities provided covered under the provisions of the Section 186 of the Act is made in the notes to the financial statements.

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary.

In terms of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as Annexure H and forms an integral part of this Report.

The Company has not accepted/ renewed any deposit (as covered under Chapter V of the Act) during the financial year under review and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Pursuant to the applicable provisions of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules'), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years. Accordingly, the Company has transferred 20.58 lakhs, pertaining to unclaimed dividend, during the period under review, to IEPF.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred 40,463 shares, during the period under review, to IEPF. The detailed information is available at our website https://www.escortskubota.com/ investors/policies-and-documents.

As on March 31, 2025, no unclaimed deposits are pending which required to be transferred to IEPF.

The present credit rating of the Company is as under: CRISIL Limited granted long term rating as "AA+ with stable outlook" and Short-Term rating as "A1+" During the financial year 2024-25, there has been no change in the credit rating.

There are no material changes affecting the financial position of the Company subsequent to the closure of the FY 2024-25 till the date of this report.

There has been no change in the nature of business of the Company, except as detailed out under the para of Divestment in this report.

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company's office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological. The Company has also complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

One case was filed and resolved during the year under review pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Our employees are our most important assets. We are committed to hiring and retaining the best talent being among the industry's leading employers. For this, we focus on promoting a collaborative, transparent and participative organisation culture, and rewarding merit and sustain high performance. Our human resources management focuses on allowing our employees to develop their skills, grow in their career.

The Company is in compliance with all the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

The Company has provided Integrated Report, which includes non-financial and financial information to have a better understanding of the Company's long-term strategy.

This report also touches upon aspects such as organisations strategy, governance framework, performance and prospects of value creation based on six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital as per International <IR> framework.

In November 2018, the Ministry of Corporate Affairs ('MCA') constituted a Committee on Business Responsibility Reporting ('the Committee') to finalise business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct ('NGRBC'). Through its report, the Committee recommended that BRR be rechristened BRSR, where disclosures are based on ESG Corporate Overview, Management Discussion and Analysis, Financial Statements parameters, compelling organisations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. Pursuant to Regulation 34 of SEBI Listing Regulations, the BRSR is mandatory for the top 1,000 listed companies (by market capitalisation). The BRSR disclosures are enclosed as Annexure I and forms an integral part of this report.

As on the date of the Report no application is pending under the Insolvency and Bankruptcy Code, 2016 and the Company did not file any application under ('IBC') during the FY 2024-25. Further, the Company has not made any one-time settlement.

Your Company does not fall under the category of large corporate, as defined by SEBI vide its circular no. SEBI/ HO/DDHS/P/CIR/2021/613 dated August 10, 2021 read with updated circular dated April 13, 2022 and Circular No. SEBI/HO/DDHS/DDHS-RACPOD1/P/CIR/2023/172 dated October 19, 2023, as such no disclosure is required in this regard.

Pursuant to Regulation 30A(2) of SEBI Listing Regulations, there is no agreement impacting the management or control of the Company or imposing any restrictions or create any liability upon the Company except as already disclosed in the Annual Report of financial year 2023-24.

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors' Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that: (i) in the preparation of the annual accounts for the year ended March 31, 2025, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed along with proper explanation relating to material departures; (ii) the Directors have selected such accounting policies and applied them consistently and made judgements and estimates 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; (iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) the Directors have prepared the annual accounts for financial year ended March 31, 2025 on a ‘going concern' basis; (v) the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively; and (vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

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:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

3. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries/ holding company except Mr. Seiji Fukuoka, Whole-time Director designated as Deputy Managing Director, who is taking a remuneration from holding company of the Company.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future. However, members attention is drawn to note 32 in the notes to accounts in the standalone financial statement and to note 34 in the notes to accounts in the consolidated financial statement which sets out information on Commitments and Contingencies.

5. Details of difference between amount of valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

6. No political contribution made during the year under review.

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana, Maharashtra, Tamil Nadu and Karnataka, Financial Institutions and the Company's Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the FY. needed. A new appointee will therefore be at the time of appointment will not be more than 70 years old. The limit of 75 years will not apply to non-independent directors and/ or to Independent Directors re-categorised as non-independent directors, subject the composition of the Board being in conformity with the extant guidelines.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

No Independent Director shall hold the office for more than two consecutive terms, but Such Independent Director shall be eligible for appointment after the expiry of three years of ceasing to become an Independent Director. Provided that an Independent Director shall not during the said period of three years, be appointed in or be associated with the Company in other capacity, either directly or indirectly. However, if a person who has already served as an Independent Director for five years or more in the Company as on April 01, 2014, or such other date as may be determined by the Committee as per regulatory requirement, he/she shall be eligible for appointment for one more term of upto five years only. At the time of appointment of Independent Director, it should be ensured that number of Boards on which such Independent Director serves is restricted to seven listed companies as an Independent Director and three listed companies as an Independent Director in case such person is serving as a Whole-time (Executive) Director of a listed company.

7. Letters of Appointment to Directors

The Company shall issue a formal letter of appointment to the person appointed as a Director of EKL. The letter of appointment to be issued to the Independent Directors shall inter alia set out the matters as stated in Schedule IV of the Companies Act, 2013.

8. Evaluation Procedure for Directors

(i) The NRC shall develop such assessment criteria as it shall deem fit for the purposes of undertaking performance evaluation of the Directors and the Board as a whole. The NRC shall undertake an annual performance evaluation of all Directors of EKL based on the relevant assessment criteria developed by it. (ii) The assessment criteria for performance evaluation of Directors shall be disclosed in accordance with the relevant provisions of the Companies Act, 2013, the rules framed thereunder and the SEBI LODR.

9. Removal

Due to reasons for any disqualification mentioned in the Companies Act, 2013, rules made thereafter or under any other applicable Act, rules and regulations, the

Committee may recommend to the Board with reasons recorded in writing, removal of a director or KMP subject to the provisions and compliance of said Act, rules and regulations.

(i) The Directors liable to retire by rotation shall retire as per the provisions of the Companies Act, 2013, read with rules framed thereunder. For Whole-Time Director(s), KMPs and members of Senior Management the retirement age shall be 58 years. The term of Independent Directors shall be governed by the provisions of the Companies Act, 2013, read with rules framed thereunder.

(ii) Any extension of the term of services beyond the age of 58 years for Whole-Time Director(s), KMPs, members of Senior Management shall be decided by the Board of Directors on case-to-case basis upon receiving recommendations from the Nomination and Remuneration Committee. Unless otherwise decided by the Board the extension shall not be more than one year duration at a time with right to revoke the extension any time as per the terms.

Notwithstanding anything contained herein the Company shall report to stock exchange(s) the change in Senior Management in accordance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations), as amended.

Whereas Senior Management (SM) means Senior Management as defined in SEBI Listing Regulations, as amended, which is reproduced below:

i. The Board may modify, add, delete, or amend any of the provisions of this Policy.

ii. In the event of any conflict between the provisions of this Policy and of the Act or SEBI LODR or any other statutory enactments, rules, the provisions of such Act or SEBI LODR or statutory enactments, rules shall prevail over this Policy.

iii. Any subsequent amendment / modification in the SEBI LODR or the Act or any other governing Act/ Rules/ Regulations or re-enactment, impacting the provisions of this policy, shall automatically apply to this policy and the relevant provision(s) of this policy shall be deemed to be modified and/ or amended to that extent, even if not incorporated in this policy.

iv. This Policy may be amended, modified or supplemented from time to time to ensure compliance with any modification, amendment or supplementation to the Companies Act, 2013, and rules made thereunder, the SEBI LODR, the Securities and Exchange Board of India Act, 1992, and rules/ regulations/ guidelines made thereunder, the Memorandum and Articles of Association of the Company or as may be otherwise prescribed by the Board from time to time.

v. The NRC may issue/ implement such guidelines, procedures, formats and/or reporting mechanisms to enforce this Policy as it may deem fit.