Macpower CNC Machines Ltd

To,

The Members, of Macpower CNC Machines Limited

Your Directors have pleasure in presenting their 21^st Annual Report on business and operation of your company together with the Financial Statements for the year ended on March 31, 2024.

FINANCIAL RESULT

~ [INR in Lakhl

OVERVIEW OF OPERATIONS (STATE OF THE COMPANY'S AFFAIRS)

Company has outperformed during the financial year 2023-24 by generating highest total operating revenue of Rs. 241.04 Crore against Rs. 201.89 Crore of previous financial year, representing an increase of 19.39% Y-o-Y. The EBITDA of the Company has grown by 70.92% Y-o-Y from the last year and reached to Rs. 35.33 Crore in current year from Rs. 20.67 Crore in last year. This year your company's Net Profit came in at Rs. 24.25 Crore versus Rs. 12.89 Crore in last year, representing a growth of 88.13% Y-o-Y. EPS stands at Rs 24.24 per share in current year against Rs 12.89 per share in last year.

CHANGE IN NATURE OF BUSINESS

There has been no change in the Nature of Business during the year.

TRANSFER TO RESERVE

No amount is proposed to be transferred to General Reserve out of the net profits of the Company for the FY24. Hence, the entire amount of profit has been carried forward to the Profit & Loss Reserve Account.

DIVIDEND

Based on the performance of the Company for the year, the Board of Directors is pleased to recommend a final dividend of Rs. 1.50/- per equity share of the face value of Rs. 10/- each (i.e. 15%), payable to those shareholders whose name appear in the Register of Members as on Record date, subject to approval of Shareholders at the ensuing Annual General Meeting, which if approved, will absorb Rs.1,50,06,240/- towards final dividend.

In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020 and amendments thereof, dividends paid or distributed by the Company shall be taxable in the hands of the Shareholders. The Company shall, accordingly, make the payment of the final dividend after deduction of tax at source.

MAJOR EVENTS OCCURRED DURING THE YEAR

During the year under review, there have been no events occurred in your company which management believes that having an impact on the affairs of your company;

DISPATCH OF MACHINES

During the year, your company has dispatched total 1235 Machines to various sectors like Private sector, Defense sector, Education sector, Research sector etc.

MATERIAL CHANGES AND COMMITMENTS/KEY DEVLOPMENTS

There have been no material changes and commitments affecting the financial position of the Company since the closure of financial year i.e. since March 31, 2024

REVISION OF FINANCIAL STATEMENTS

None of Financial Statements of the Company, pertaining to previous financial years were revised during the financial year under review.

EXTERNAL ENVIRONMENT AND ECONOMIC OUTLOOK

Disclosed in Management discussion and analysis report

SHARE CAPITAL AND DEBT STRUCTURE

There was no change in Authorised and Paid up Share Capital of the Company and neither there was any reclassification nor sub-division of equity shares during the year under review. Your Company does not have Debt securities.

CREDIT RATING OF SECURITIES

Your company only has Equity shares and Credit rating is not applicable to equity securities. So, during the year no credit rating certificate related securities is taken as it is not applicable.

INVESTOR EDUCATION AND PROTECTION FUND [IEPF]

During the year under review, Company was not required to transfer any amount of dividend or any shares to Investor Education and Protection Fund.

The details of unpaid and unclaimed dividends are available on the Company's website at https://macpowercnc.com/unpaid-or-imclaimed-dividend-details/. Details of unpaid and unclaimed dividends up to March 31, 2024 are also uploaded on the website of the IEPF Authority and can be accessed through the link: www.iepf.gov.in.

Due dates for transfer to IEPF, of the unclaimed/unpaid dividends for the financial year 2017-18 and thereafter, are as under:

In Furtherance, Company has appointed Nodal Officer for and on behalf of the Company to Co-Ordinate with IEPF Authority pursuant to Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Second amendment Rules, 2019 and amendment thereto if any, Details of Nodal Officer is as under:

Name: Mr. Kishor Kikani

Designation: Company Secretary & Compliance Officer

Contact details: csramacpowercnc.com

MANAGEMENT

i. Director and Key Managerial Personnel Directors

Following are the Promoter/Promoter group Directors of the Company as on 31^st March, 2024 and during the year under review, there has been no change in the Board of Directors of the Company:

Director retiring by rotation

Mr. Rupesh Jagdishbhai Mehta (DIN: 01474523), Managing Director of the Company retires at this ensuing Annual General Meeting pursuant to provision of section 152(6) of the Companies Act, 2013 and being eligible, offer himself for reappointment.

The relevant details and Brief profile of Director seeking re-appointment is given in the Notes/Annexures to the Notice of the Annual General Meeting.

Key Managerial Personnel fKMPl

Pursuant to the provisions of Section 203 of the Companies Act, 2013, following are the Key Managerial Personnel of the Company as on March 31, 2024:

Change in KMP during the year

During the year under review, there is no change in the KMP of the Company:

ii. Independent Directors

Following are the Independent Directors of the Company and during the year under review there has been no change in the Independent Directors of the Company:

1) Mr. Maulik R. Mokariya [DIN: 05310868],

2) Mr. Rajubhai R. Bhanderi (DIN: 07986563] and

3) Mr. Deven J. Doshi [DIN: 07994505]

Aforesaid all the Independent Directors were reappointed at 19^th annual general meeting held on 27.09.2022 for a period of five (5) years for 2nd term from November 17, 2022 to November 16, 2027.

In terms of the Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of the Company have enrolled themselves on the Independent Directors Databank and also passed the online proficiency self-assessment test within the specified timeline.

iii. Declaration by Independent Directors

Pursuant to the provisions of Section 149 of the Act, the independent directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and as per Regulation 16(l)(b) and Regulation 25 (8) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") at the first meeting of the Board of financial year. In Furtherance, Company has also received confirmation that that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence and that they are independent of the management. There has been no change in the circumstances affecting their status as independent directors of the Company.

During the year under review, the non-executive director and Independent Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses, if any, incurred by them for the purpose of attending meetings of the Board/Committee of the Company. None of the Directors are disqualified to be continued to act as Director of the Company.

iv. Board Meeting

Six meetings of the Board of Directors were held during the year under review and the gap between two meetings did not exceed one hundred and twenty days. For details of meetings of the Board, please refer below table:

During FY 2023-24, none of resolutions were passed by circulation. Meetings of the Independent Directors were held on 29/01/2024. The Independent Directors, inter-alia, reviewed the performance of Chairman of the Company and Board of Directors.

v. Committees of the Board

There are 4 Board Committees as on March 31, 2024 that have been formed, considering the needs of the Company, details of which are as follows;

vi. Company's Policy /Terms of Reference of committees

The Terms of Reference of Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and corporate social responsible committee are disclosed in Corporate Governance report which forms part of this Annual Report. Further, all the recommendation of Audit committee have been approved by the Board of Directors of the Company.

vii. Company's Policy on Directors' Appointment and Remuneration

Remuneration policy of the Company is designed to create a high-performance culture. It enables the Company to attract, retain and motivate employees to achieve results. Our business model promotes customer centricity and requires employee mobility to address project needs. The remuneration policy supports such mobility through pay models that are compliant to local regulations.

The Company pays remuneration to its Managing Director & the Executive Directors as professional fees/consultancy fees. Annual increments are recommended by the Nomination and Remuneration Committee.

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee, decides the commission/remuneration payable to the Managing Director and the Executive Directors out of the profits for the financial year and within the ceilings prescribed under the Act, based on the Board evaluation process considering the criteria such as the performance of the Company as well as that of the Directors. The said commission/remuneration is decided each year by the Board of Directors, on the recommendation of the Nomination and Remuneration Committee and paid to the Managerial personnel based on the Board evaluation process, considering criteria such as their attendance and contribution at the Board and Committee meetings, as well as the time spent on operational matters other than at meetings. The Company may reimburse the out-of-pocket expenses incurred by the Directors for attending the meetings. Remuneration paid is approved by members of the Company

viii. Board Evaluation

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 Companies Act, 2013 and SEBI (LODR) Regulations, 2015.The performance of the board was evaluated by the Board after seeking inputs from all the directors on the basis of 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 criteria such as the composition of committees, effectiveness of committee meetings, etc.

In a separate meeting of independent directors, performance of non-independent directors, the board as a whole and the Chairman of the Company were evaluated, taking into account the views of executive directors and non-executive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

As per Companies Act, 2013, Board has made annual evaluation of its own performance and also of its committees and Individual Directors. The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. Board of Directors is actively taking an action for evaluation.

ix. Remuneration of Directors and Employees

Details of Remuneration of Executive Directors for the year ended on March 31,

2024:

* Board of directors has based upon the recommendation of nomination and remuneration committee and subject to approval of members of the company (which later approved by members at their AGM held on 27.09.2022) has reappointed and revised managerial remuneration as follows:

Mr. Rupesh J. Mehta having monthly remuneration byway of professional/Management Consultancy Fee of Rs.3 Lakhs plus 18% GST with effect from 01$t October, 2022 and Mr. Nikesh J. Mehta havingmonthly remuneration byway of professional/Management Consultancy Fee of Rs.2 Lakhs 18% GST with effect from 01st October, 2022.

The Company has not paid any remuneration/commission/sitting fees to Non- Executive director and Independent Directors.

Particulars of employees:

Disclosure pertaining to remuneration and other details as required under the Act read with Rule 5 of the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014 and amendments thereof are provided in the Annual Report. Particulars of Employees in terms of the provisions of Section - 197(12) of the Act read with Rule 5 is attached with this report as Annexure - 1.

x. Directors' Responsibility Statement

Pursuant to the provisions of Section 134(3)(C) and 134(5) of the Companies Act, 2013, Your directors confirm, to the best of their knowledge and belief:

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the year and the profit and loss of the company for that period;

(c) The Directors had 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;

(d) The Directors had prepared the annual accounts on a going concern basis;

(e) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively;

(f) The Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and operating effectively.

INTERNAL FINANCIAL CONTROLS AND INTERNAL CONTROL SYSTEMS:

"Internal financial controls" 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.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Company's internal financial controls were adequate and effective during FY 2023-24.

The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious lapses have been observed by the Internal Auditors of the Company for inefficiency or inadequacy of such controls.

The Company's internal control procedure, which includes internal financial controls, ensures compliance with various policies, practices and statutes keeping in view the organization's pace of growth and increasing complexity of operations. The Internal Auditors carry out extensive audits throughout the year across all functional areas and submit their reports to the Audit Committee. The said Reports have not included any observation of any serious lapses in the system during the year under review.

Based on its evaluation (as defined in section 177 of Companies Act 2013 and Clause 18 of SEBI Regulations 2015], our audit committee has concluded that, as of March 31, 2024 our internal financial controls were adequate and operating effectively.

DISCLOSURES RELATING TO SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

Your company has no holding/subsidiary/associate company. So, disclosure in AOC-1 required under section 129 of the Act is not applicable to your company.

DETAILS OF DEPOSITS

Your company has not accepted any deposits and as such no amount of Principal or Interest was outstanding as of the Balance Sheet.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Your Company has not made any transaction that was falling under the ambit of section-186 of the Companies Act, 2013.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Your Company has entered into transaction with Related Parties at Arm's Length Basis. Particulars of contracts or arrangements with related parties referred to section - 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2, is appended as Annexure - 2 to the Board's Report.

CORPORATE SOCIAL RESPONSIBILITIES

Your Company is falling under the ambit of Section 135 of the Companies Act, 2013 i.e. Corporate Social Responsibility. During the year 2023-24, company has spent total amount of Rs. 28.62 Lacs as CSR expenditure.

The brief outline of the Corporate Social Responsibilities [CSR] policy of the Company and the initiatives undertaken by your company on CSR activity during the year under review are set out in Annexure -3 of this report in the format prescribed in the Companies [Corporate Social Responsibility Policy] Rules, 2014 i.e. Annual Report on CSR Activities. The CSR policy is available on the website of the company at https://macpowercnc.com/wp-content/uploads/sites/395/2023/06/CorporateSocialResponsibilitvpolicv.pdf

Further, the details relating to the Composition of CSR Committee and Meetings of CSR Committee disclosed in above point of Board's Report relating to Committees of Board and also disclosed in the Annual Report on CSR Activities.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8{3) of the Companies (Accounts) Rules, 2015 is furnished in Annexure - 4 attached to this report.

RISK MANAGEMENT

The Company was not required to frame Risk Management Committee pursuant to Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and accordingly not constituted, however, the board of directors is responsible for framing, implementing and monitoring the risk management plan for the listed entity and Audit Committee of the Company also evaluating Risk Management Systems.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees to report concerns about unethical behavior and to report instances of leak of unpublished price sensitive information. No person has been denied access to the Chairman of the Audit Committee. The said policy has been uploaded on the website of the Company at https: / / macpowercnc.com/ wp- content / uploads/sites/395/2023/06/ VigilMechanismorWhistleBlowerpolicy.pdf

The Audit Committee is continuously verifying the Whistle Blower policy (vigil mechanism) which provides a format mechanism for all stakeholders, employees anddirectors of the Company to approach the Chairman of the Audit Committee of the Company and make protective disclosures about the unethical behavior towards stakeholder/employee of the company, leak of UPSI, actual or suspected fraud or violation of the Company's Code of Conduct.

MATERIAL ORDERS OF JUDICIAL BODIES /REGULATORS

During the year under review, there are no significant or material orders passed by the Regulators/Courts/Tribunals that could impact the going concern status of the company and its future operations.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

During the year under review, there was no application made or no proceeding pending under the insolvency and bankruptcy code, 2016.

AUDITORS AND AUDITORS* REPORT

The Details of the Auditors of the Company are as stated below:

A. STATUTORY AUDITORS:

M/s. S. C. Makhecha & Associates, Chartered Accountants (FRN: 120184W) were Appointed in 20^,h AGM (i.e. AGM for 2022-23] for a 2^nd term of 5 consecutive years from 20^fh AGM until the Conclusion of 25^th AGM (i.e. from FY 2023-24 to F.Y 2027- 28). They have given consent and confirmed that they are not disqualified from continuing as Auditors of the Company. Further, as required under SEBI (LODR) Regulations, 2015, they hold valid peer review certificate No. 015108.

The Auditors' Report for the financial year ended March 31, 2024 does not contain any reservation, qualification or adverse remark. The notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

NO FRAUD REPORTING

No fraud has been reported by the Auditors under section 143(12) of the Companies Act, 2013 requiring disclosure in the Board's Report.

B. SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Act and Rules made there under, the Board of Directors had appointed M/s. K. P. Rachchh 8s Co., Practicing Company Secretaries for conducting Secretarial Audit of the Company for the FY 2023-24.

The Secretarial Audit Report obtained pursuant to the provisions of Section 204 of the

Act and Rules made there under, from M/s. K. P. Rachchh & Co., Practicing Company Secretaries for the FY 2023-24 is set out at ‘Annexure- 5* forming a part of this Report.

The Secretarial Auditors Report for the financial year ended March 31, 2024 is self- explanatory and does not call for any further clarifications.

Further, the Company has re-appointed M/s. K. P. Rachchh 8s Co., Practicing Company Secretaries for conducting Secretarial Audit of the Company for the FY- 2024-25 under the Companies Act, 2013 and under regulation 24A of the SEBI (LODR) Regulations, 2015.

C. COST AUDITORS:

The Board has appointed M/s. Borad Sanjay B 8& Associates, Cost Accountants for conducting the audit of cost records of the Company for single segment for the financial year 2023-24 as recommended by the Audit Committee.

Further, the Company has re-appointed M/s. Borad Sanjay B & Associates, Cost Accountants for the year 2024-25 at a remuneration of Rs. 35,000/- and As required under Section-148 and Rule 14 of the Companies [Audit and Auditors] Rules, 2014, Necessary resolution for ratification of payment of remuneration to the said Cost Auditors forms part of the Notice of the ensuing Annual General Meeting

D. INTERNAL AUDITORS:

Mr. Vishal B. Mehta has been appointed by the Board of Directors at their meeting held on July 7, 2023, as Internal Auditors of the Company for the financial 2023-24 w.e.f July 8, 2023 upon resignation of Mr. Vishal Kadia as an internal auditor of the Company with effect from July 7, 2023 due to his preoccupation in other assignments.

COMPLIANCE WITH SECRETARIAL STANDARDS

We, the Directors of the Company, hereby state the Company has complied all applicable Secretarial Standards to the applicable extend.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2024 is available on the website of the Company at

https://macpowercnc.com/annual-return/

MANAGEMENT DISCUSSION AND ANALYSIS REPORT (MDAR)

Management Discussion & Analysis Report for the year under review, under Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), is presented in a separate section and forms a part of this Report.

CORPORATE GOVERNANCE REPORT

Your directors reaffirm their continued commitment to good corporate governance practices. During the year under review, your company was in compliance with the provisions of SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015, relating to Corporate Governance.

The Report on Corporate Governance as stipulated under Regulation 34 of the SEBI Listing Regulations forms an integral part of this Report. The requisite certificate on Corporate Governance availed from M/s. K. P. Rachchh & co. Practicing Company Secretaries, confirming compliance with the conditions of corporate governance as stipulated under Schedule V of the SEBI Listing Regulations is enclosed to the Report on Corporate Governance presented in a separate section and forms a part of this Report

DISCLOSURES PERTAINING TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has adopted a policy on prevention, prohibition and Redressal of Sexual harassment at workplace and has duly constituted an Internal Complaints Committee in line with the provisions of the Sexual Harassment of Women at Workplace [Prevention, Prohibition and Redressal] Act, 2013 and the Rules thereunder. The said policy is uploaded on the website of the Company at https://macpowercnc.com/wp- content/uploads/sites/395/2023/Q6/POLICYONSEXUALHARASSMENTATWORKPLACE. pdf

There have been no complains related sexual harassment reported during the year under review.

INSURANCE

The assets of the company including buildings, plant & machinery, stocks, etc. wherever necessary and to the extent required have been adequately insured against various risks.

SEGMENT REPORTING

The Company is engaged in the business of manufacturing of CNC Turning Centers, Vertical Machining Centers [VMC], Horizontal Machining Centers [HMC], Cylindrical Grinder, Vertical Turret Lathe [VTL], Turn Mill Centers, Drill Tap Center [DTC], Twin Spindle Turning & VMC along with robotic automation solutions. Considering the nature of the Business and Financial Reporting of the Company, the segment reporting is not applicable to company as your company's business in single segment.

HUMAN RESOURCE DEVELOPMENT

Your Company continued to focus on attracting new talent while investing in organic talent development to help employees acquire new skills, explore new roles and realize their potential.

The Company's relation with human resource continued to be cordial during the year under review. The Board wishes to take place on record its appreciation for the valuable services rendered by its entire workforce. During the year there was no instance of Strike, Lock out or another issues related to Human Resources.

GENERAL

The Board of Directors confirms that no disclosure or reporting is required in respect of the below matters as there were no transactions on these matters during the FY24:

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

2. Issue of shares (including sweat equity shares or Stock options) to employees of the Company;

3. non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014;

4. Material or serious instances of fraud falling within the purview of Section 143(12) of the Act and Rules made there under.

ACKNOWLEDGMENTS

The Directors thank the Company's employees, customers, vendors, investors and academic partners for their continuous support.

The Directors also thank the Government of India, Governments of various states in India, Governments of various countries and concerned Government departments and agencies for their co-operation.

The Directors appreciate and value the contribution made by every member of the work family.

Stakeholders support is also acknowledged by the Management of the Company.