NELCO Ltd

To

The Members,

The Directors have pleasure in presenting Eighty Second Annual Report of Nelco Limited (Company or Nelco) along with the Audited Statement of Accounts for the year ended 31^st March 2025.

1. Financial Results

(Rs in lakhs)

2. Dividend

The Directors of your Company recommend for FY 2024-25, a dividend of Rs 1/- per share of Rs 10/- each i.e. 10% (previous year Rs 2.20 per share i.e. 22%) subject to the approval of the Members at the ensuing AGM. If approved, the total dividend outgo for FY 2024-25 would amount to Rs 228 lakhs (previous year Rs 502 lakhs).

According to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the top 1000 listed entities based on market capitalization, calculated as on 31^st March of every financial year are required to formulate a dividend distribution policy which shall be disclosed on the website of the listed entity and a web-link shall also be provided in their annual reports. Accordingly, the Dividend Policy of the Company can be accessed using the following link: https://www.nelco.in/pdf/ Policies/dividend-distribution-policy.pdf

3. Financial Performance and the state of the Company's affairs

On a Standalone basis, your Company achieved revenue of Rs 20,563 Lakhs in FY 2024-25 from Operations as against Rs 22,268 Lakhs in FY 2023-24 i.e. decreased by 8 % from previous year. In FY 2024-25 the Company earned net profit after tax of Rs 981 Lakhs from the total operations as against net profit after tax of Rs2,127 Lakhs in FY 2023-24. This was due to decrease in service revenue and onetime tax litigation settlement under Vivad Se Vishwas Scheme of Rs 509 lakhs.

On a Consolidated basis, revenue from Operations was Rs 30,487 Lakhs in FY 2024-25 as against Rs 32,030 Lakhs in FY 2023-24 i.e. decreased by 5% from previous year.

The segment wise performance (Consolidated) from Operations for the year was as follows:

Based on evaluation of key financial parameters, the Company believes that it operates in only one reportable segment i.e. Network Systems and accordingly the financial results are reported as single reportable segment The Company earned a net profit after tax of Rs 953 Lakhs from operations as against net profit after tax of Rs 2,367 Lakhs in FY 2023-24. i.e. decreased by 60 %. This was due to decrease in revenue and one time impact of Rs 509 lakhs related tax litigation settlement under Vivad Se Vishwas Scheme.

The Company has strengthened its overall position in the market with a higher share of the incremental business in Enterprise, Government and IFMC segments. The Company has demonstrated its agility in creating new businesses and solutions and delivering value to customers and global partners. The Company has been a lead adopter of Satcom technologies and will continue to leverage global technology advancements to serve a larger number of segments and applications using GSO and NGSO networks, software defined satellites, new-age electronics and many more technologies as and when these are available. The Company has partnered with multiple global players and will continue to have more partnerships in future to enhance its offerings and reach. The Company continuously evaluates opportunities for investment and augmentation of its technology, satellite network capabilities and ground infrastructure, developing new products and services for enabling ubiquitous, reliable, secure, and high-quality connectivity through Satcom services. There has been no material changes and commitments that have occurred after the close of the year under review till the date of this report which affect the financial position of the Company.

Information in detail has been given in the Management Discussion & Analysis which forms a part of this report.

4. Reserves

The Board of Directors has decided to retain the entire amount of profit for FY 2024-25 in the statement of profit and loss.

5. Subsidiary & Associate Company

The Company has a wholly owned subsidiary - Nelco Network Products Ltd. (NNPL) and an associate company - Piscis Networks Pvt. Ltd. (PISCIS) as on 31^st March 2025. Subsidiary Company The revenue of NNPL for FY 2024-25 was 9,930 Lakhs (previous year Rs 9,989 Lakhs) and loss after tax was Rs 61 Lakhs (previous year profit after tax was Rs 222 Lakhs) and the accumulated reserve and surplus since incorporation was Rs 3,422 Lakhs.

Associate Company

The revenue of PISCIS for FY 2024-25 was Rs 1,433 Lakhs (previous year Rs 809 Lakhs) and profit after tax was Rs 231 Lakhs (previous year profit after tax was Rs 233 Lakhs). This was due to increase in sale of number of SDWAN routers and corresponding increase in operating expenses. The Company's share of profit in associate for FY 2024-25 was

Rs 19 Lakhs (previous year Rs 47 Lakhs).

As required under Section 129(3) of the Companies Act, 2013 (Act), a report on the financial performance of NNPL & PISCIS in Form AOC-1 is attached to the financial statements of the Company.

Further, pursuant to Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of subsidiary Company, are available on the website of the Company https://www.nelco.in/investor-relation/financial.php The Policy for determining material subsidiaries of the Company has been provided in the following link: https://www.nelco.in/pdf/Policies/Policy%20for%20determining%20Material%20Subsidiaries.pdf

6 Directors and Key Managerial Personnel

Re-appointment/appointment of Directors

In accordance with the requirements of the Act and the Company's Articles of Association, Mr. Saurabh Ray (DIN: 09573704) retires by rotation and is eligible for re-appointment. The Members' approval is being sought at the ensuing AGM for this re-appointment.

Additional information and brief profile as stipulated under Listing Regulations and Secretarial Standards-2 on General Meetings with respect to Directors seeking re-appointment is annexed to the Notice of AGM.

Based on the recommendation of the Nomination, HR and Remuneration Committee (‘NRC') and Board of Directors, the Members at the 81^st AGM held on June 25, 2024 approved the re-appointment of Mr. P J Nath (DIN: 05118177) as the Managing Director & CEO of the Company, for period from 13^th June, 2024 to 28^th February, 2027 (i.e. date of his superannuation from the services of the Company) and remuneration payable thereof.

In terms of the provisions of Section 149 of the Act and Regulations 17 and 25 of Listing Regulations, Dr. Lakshmi Nadkarni (DIN: 07076164) and Mr. Ajay Kumar Pandey (DIN: 00065622) were appointed as an Independent Director of the Company by the Members at the 77^th AGM of the Company, for a term of five years commencing from January 28, 2020 to January 27, 2025. Accordingly, based on recommendation of NRC and the Board, the Members by the way of a Postal Ballot on February 20, 2025, approved the re-appointment of Dr. Nadkarni and Mr. Pandey for a second term as an Independent Director of the Company effective January 28, 2025 to January 27, 2030.

Further, based on recommendation of NRC and in accordance with provisions of the Act and Listing Regulations, Mr. Vijay Somaiya (DIN: 03185227) was appointed as an Additional Director (Independent) of the Company by the Board of Directors on January 15, 2025, for a term of 5 years commencing from January 27, 2025 upto January 26, 2030, subject to the approval of Members. Accordingly, based on recommendation of NRC and the Board, Members by the way of a Postal Ballot on February 20, 2025, approved the appointment of Mr. Somaiya for a first term as an Independent Director of the Company effective January 27, 2025 upto January 26, 2030.

Cessation of Director

During the year under review, Mr. K.N. Murthy (DIN 00023046), Independent Director of the Company, who were appointed at the 77^th Annual General Meeting of the Company held on 13^th August 2020 for a period of 5 years, completed his tenure as Independent Director of the Company on 27^th January 2025 at the close of working hours. The Board places on record its appreciation for invaluable contribution and guidance provided by Mr. Murthy, during his tenure as Independent Director of the Company.

Independent Directors

In terms of Section 149 of the Act, Dr. Lakshmi Nadkarni, Mr. Ajay Kumar Pandey and Mr. Vijay Somaiya are the Independent Directors of the Company.

In terms of Regulation 25(8) of the Listing Regulations, they have confirmed that they are not aware of any circumstances or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties as Independent Director of the Company. Based upon the declarations received from the Independent Directors, the Board of Directors has confirmed that they meet the criteria of independence as mentioned under section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and that they are independent of the management. Further, the Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience (including the pro_ciency) and expertise in their respective fields and that they hold highest standards of integrity.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied of the integrity, expertise, and experience (including pro_ciency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. Further, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, Independent Directors of the Company have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company.

Key Managerial Personnel

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company as on 31^st March 2025 are:

• Mr. P.J. Nath, Managing Director & CEO

• Mr. Malav Shah, Chief Financial Officer

• Mr. Ritesh Kamdar, Company Secretary

Mr. Girish V. Kirkinde (ACS: 7493), Company Secretary & Head- Legal superannuated from the services of the Company on close of business hours of 30^th April 2024. The Board places on record its appreciation for the valuable contribution provided by Mr. Kirkinde to the Company. On the recommendation of NRC, the Board approved the appointment of Mr. Ritesh N. Kamdar (ACS:20154) as Company Secretary & Head-Legal and Key Managerial Personnel effective from 14^th May 2024.

Number of Board meetings

During the year under review, eight Board Meetings were held. For further details, please refer Report on Corporate Governance. Governance Guidelines: The Company has adopted Governance Guidelines on Board Effectiveness. The said Guidelines covers aspects related to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, Director's term, retirement age and Committees of the Board. It also includes aspects relating to nomination, appointment, induction and development of Directors, Director remuneration, subsidiary oversight, Code of Conduct, Board effectiveness review and mandates of Board Committees.

7. Annual Evaluation of Board Performance and Performance of its Committees and Individual Directors, etc.

As required under the Act and Listing Regulations, the Board has carried out formal annual evaluation of the performance of the Board, its Committees and of individual Directors. 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.

The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on 5^th January 2017.

In a separate meeting of Independent Directors, performance of non-Independent Directors, the Board as a whole and the Chairman of the Company was evaluated, considering the views of Managing Director & CEO and non-Executive Directors. The Board and the NRC 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.

In the Board meeting that followed the meeting of the Independent Directors and meeting of Nomination, HR and Remuneration Committee, the performance of the Board, its Committees, and individual Directors was also discussed. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.

Based on inputs received from the Board members, it emerged that the Board had a good mix of competency, experience, qualifications and diversity. Each Board member contributed in his/her own manner to the collective wisdom of the Board, keeping in mind his/her own background and experience. There was active participation, and adequate time was given for discussing strategy. Overall, the Board was functioning very well in a cohesive and interactive manner.

The Committees of the Board focus on certain specific areas and make informed decisions in line with the delegated authority. The following substantive Committees constituted by the Board function according to their respective roles and defined scope:

• Audit Committee (AC)

• Nominations, HR and Remuneration Committee (NRC)

• Stakeholders Relationship Committee (SRC)

• Risk Management Committee (RMC)

Details of composition, terms of reference and number of meetings held for respective Committees are given in the Report on Corporate Governance which forms part of the Annual Report. Further, during the year under review, all recommendations made by the Audit Committee have been accepted by the Board.

The details of the familiarization programs for Independent Directors are disclosed on the Company's website and the web link for the same is: https://www.nelco.in/pdf/Policies/familarization-programme-24-25.pdf The Company has adopted a Code of Conduct for its Non-Executive Directors including a code of conduct for Independent Directors which suitably incorporates the duties of Independent Directors as laid down in the Act. The Company has also adopted the Tata Code of Conduct for its employees including the Managing and Executive Directors. The above codes can be accessed on the Company's website at https://www.nelco.in/ investor-relation/corporate-governance.php.

In terms of the Listing Regulations, all Directors and senior management personnel have afirmed compliance with their respective codes. The CEO & Managing Director has also confirmed and certified the same. The certificate in this regards is provided at the end of the Report on Corporate Governance.

In terms of the provisions of Section 178(3) of the Act and Regulation 19 read with Part D of Schedule II to the Listing Regulations, the NRC is responsible for formulating the criteria for determining qualification, positive attributes and independence of a Director. The NRC is also responsible for recommending to the Board a policy relating to the remuneration of the Directors, Key Managerial Personnel and other employees. In line with this requirement, the Board has adopted the policy on Board Diversity, which is reproduced in Annexure-I forming part of this report and Remuneration Policy for Directors, Key Managerial Personnel and other employees of the Company is available on the websites of the Company at https://www.nelco.in/pdf/Policies/Remuneration%20 Policy%20for%20Directors,%20KMP%20and%20Other%20employees.pdf.

Salient Features of this policy are as under: -

• The philosophy for remuneration of Directors, Key Managerial Personnel ("KMP") and all other employees of Nelco Ltd. ("Company") is based on the commitment of fostering a culture of leadership with trust. The remuneration policy is aligned to this philosophy.

• Independent Directors ("ID") and non-independent Non-Executive Directors ("NED") may be paid sitting fees (for attending the meetings of the Board and of committees of which they may be members) and commission within regulatory limits.

• Overall remuneration should be reflective of size of the company, complexity of the sector/ industry/ company's operations and the company's capacity to pay the remuneration.

• The NRC will recommend to the Board the quantum of commission for each director based upon the outcome of the evaluation process which is driven by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by directors other than in meetings.

• The extent of overall remuneration to Managing Director ("MD")/ Executive Directors("ED")/ KMP/ rest of the employees should be sufficient to attract and retain talented and qualified individuals suitable for every role.

• The remuneration mix for the MD/EDs is as per the contract approved by the shareholders.

• In addition to the basic/fixed salary, the company provides to other KMPs and employees with certain perquisites, allowances and benefits to enable a certain level of lifestyle and to offer scope for savings and tax optimization, where possible and also performance linked bonus.

• Remuneration is payable to Director for services rendered in professional capacity and which NRC is of the opinion that the director possesses requisite qualification for the practice of the profession.

• There is no change in the aforesaid policies during the year under review.

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 (Rules) are provided in Annexure - II (A) forming part of this Report.

Statement containing particulars of top 10 employees and the employees drawing remuneration in excess of limits prescribed under Section 197 (12) of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure II (B) forming part of this report. None of the employees listed in the said Annexure II (B) is related to any Director of the Company. In terms of proviso to Section 136(1) of the Act, this Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. The said Statement is open for inspection at the Registered Office of the Company. Any member interested in obtaining a copy of the same may write to the Company Secretary.

As per Listing Regulations, the Corporate Governance Report with the Secretarial Auditors' Certificate thereon and the Management Discussion and Analysis are attached, which forms part of this Annual Report.

Pursuant to Regulation 34 of the Listing Regulations, the BRSR, initiatives taken from an environmental, social, governance and sustainability perspective in the prescribed format is attached as a separate section of this Annual Report.

8. Significant and material Orders passed by the Regulators or Courts or Tribunal

No significant and material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and your Company's operations in future.

There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

9. Risks and Concerns

The Indian satellite communication industry offers significant growth potential but comes with notable risks. The Company is faced with risks of different types including strategic, financial, regulatory and operational. Each of the risks need different approaches for mitigation and management. Details of various risks faced by the Company are provided in Management Discussion & Analysis.

Risk Management Framework and Internal Financial Controls

Risk Management Framework: The Company has established a risk management framework and policy based on which risks are identified and assessed across its business segments. The Company has also implemented a Resilience framework which enables a differentiated approach for various risks - mitigation is by robust controls and redundancies and mitigation by innovation and newer approaches, as required. The Risk Management Committee (RMC) of the Board focuses on proactive risk identification and mitigation by monitoring and reviewing the risk management plan and ensuring its effectiveness. The Company's key risks are discussed with RMC on a half yearly basis. The Audit Committee and Board have an additional oversight in key strategic and financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

The Company's Internal Risk Management Committee, which comprises of the CEO, CFO, Chief Risk Officer, and key business/operations leaders, is responsible for the systematic identification, assessment, quanti_cation, and mitigation of current and emerging risks. The Company's robust risk management and resilience framework ensures structured decision-making across all organizational levels, with clearly defined risk thresholds and mitigation strategies aligned with the Company's risk appetite. There are no material risks, which in the opinion of the Board may impact Company's continuity, reflecting the effectiveness of its proactive risk governance measures.

Internal Financial Control and Systems: The Company has a robust internal financial control system, commensurate with the nature of its business, the size, complexity of its operations, and industry requirements. These financial controls including those pertaining to financial reporting are designed to be effective and adequate for ensuring accuracy and compliance. To strengthen governance, an independent Chartered Accountant firm has been appointed as Internal Auditor, who audits risk management frameworks, internal controls, and operational processes. Key audit findings are reported to the Audit Committee, with Internal Financial Control (IFC) testing integrated into the annual audit plan. The scope, authority, and responsibilities of internal audit are formally codi_ed in the Company's Audit Committee Charter.

In compliance with Section 177 of the Act and the Audit Committee Charter adopted by the Board, the Audit Committee is mandated to evaluate the effectiveness of the Company's internal control systems, particularly Internal Financial Controls (IFC). These controls have been comprehensively addressed in the Management Discussion & Analysis section of this report.

The Company has implemented robust processes to ensure that all internal financial controls are effectively working. On review of the internal audit observations and action taken on audit observations, there are no adverse observations having material impact on financials, commercial implications or material non-compliances which have not been acted upon. In addition, the statutory auditors carry out an audit at quarterly intervals and these reports also have not indicated any adverse findings. The Company has established robust processes to ensure effective internal financial controls. The review of internal audit findings and corresponding corrective actions confirms:

• No material adverse observations impacting financial reporting

• No significant commercial implications

• No unresolved material non-compliances

Furthermore, quarterly audits conducted by statutory auditors consistently validate these findings, with no adverse reports or material exceptions identified. This multi-layered assurance framework demonstrates the robustness of our financial controls.

Process Robustness: The Company engages external agencies to conduct comprehensive business excellence assessments and process deep dives across key functional areas. These evaluations serve to enhance operational efficiency and process effectiveness through systematic analysis and improvement initiatives. The Company assesses the process maturity and robustness for its key functions on the following: i. Process Governance o Comprehensive documentation of workflows and standard operating procedures o Clearly defined roles and responsibilities throughout process execution ii. Control Environment o Implementation of manual and system-driven controls o Robust maker-checker authorization protocols iii. Performance Management o Tracking of key performance indicators o Benchmarking against industry standards iv. Continuous Improvement o Identification and implementation of process optimization initiatives o Adoption of best practices and technological advancements This structured approach ensures world-class process standards while driving continuous operational improvement across the organization.

Owing to the losses as per the calculation of net profit under Section 198 of the Act, the Company was not required to spend any amount statutorily towards CSR activities. However, the employees actively participated in Volunteering activities organised under Tata Volunteering Week and Pro-engage. In FY 2024-25, Nelco registered 570+ hours of volunteering through various CSR initiatives in different cities of India. The Company catered to around 700+ beneficiaries from different NGOs across India. The Company engaged in sponsoring NGOs for Skill enablement of Youths – sponsoring 24 Youths who are being familiarized with skills for their future.

The disclosures as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 are set out in Annexure VI of this report.

The Company placed utmost importance to establish a safe work environment for its employees, contractual workforce, suppliers, visitors and partners. Specific focus was given to determine safety standards on Office Safety, Field Safety, Working at Height safety & Electrical and Fire Safety. Employees are encouraged to report observations & Incidences on the Online Safety reporting portal for taking preventive & corrective measures. The Company adopts a proactive and responsible approach to safeguard the welfare of its employees. Communication on health tips, virtual seminars on health topics, Doctors availability in the premise, Health check-up packages are some of the services available for employees and families.

As on 31^st March 2025, the Company had an employee strength of 104. During the year under review, 27 employees were recruited, and 18 employees were separated.

Various people related initiatives were undertaken by the Company during the year to enable organizational growth through people care and development which include:

• Engagement & Empowerment: The Company utilises multiple platforms that encourage open communication amongst employees and allow them to voice their opinion. Employee Engagement Surveys enable people to voice out their views, concerns and suggestions for making the workplace better for everyone. Ideas Portal is a platform where employees share ideas which are further evaluated and translated into actions wherever feasible. Employees are encouraged to participate in the group initiatives such as e-hackathon and Tata Innovista to gain visibility and showcase competency. Youngsters are encouraged to become Digital Mentors and share their skills and knowledge through Reverse Digital mentoring Platform. Employee welfare and sports activities ensure, team bonding and motivation. People are encouraged to participate in the Company's Improvement projects where they get an opportunity to ideate and provide solutions to existing problems thus, support the company in making improvements and achieving its objectives. People are also encouraged to volunteer for group and Company level CSR activities and contribute to society.

• Reward & Recognition (R&R): The Company adopts an holistic R&R framework that recognizes and incentivizes exceptional performance. It promotes recognitions at all levels. Initiatives like Appreciation week, Quarterly awards which include Individual & Team awards ensures that employee contributions are acknowledged timely. Nelco Innovista awards is an internal platform which encourages creativity and rewards participants for the out of the box thinking and innovative minds.

• Capability Development: The Company focuses on overall capability building of functional, managerial and behavioral skills as planned during the Annual Business planning exercise and Performance management process. HR team aligns its strategic objectives with the company's short-term and long-term growth plans and builds capability planthrough organizing inhouse, residential and virtual workshops and fulfilling the training requirements through e-learning platforms. Employees were also encouraged to undergo additional trainings of their choice available on the eLearning portal. Through defined feedback mechanism the company seeks regular improvements in its approach and quality of the trainings. The Competency Assessment Framework gave a clear picture on which skills to be build at people and role level to stay competitive in the market. The company has made efforts to build its Digital and data competencies. PMO function has been specifically created for enhancing data science and digital capabilities.

• Performance & Talent Management: Employee performance is monitored and managed through rigorous processes of Performance Appraisal. Mapping the SMART goals in the online system ensures that Goals are properly maintained and tracked for improving people's, departments and overall organization's productivity. Continuous performance dialogues are encouraged between managers and their teams with focus on guiding and training first time managers through performance coaching. The Performance Linked Pay encourages employees to perform at their best to get higher rewards. The linkage of R & R with PMS creates a structured approach to manage performance, motivate employees, and recognize their contributions, all of which are essential for achieving organizational success.

• Succession Planning: The Company has a defined Succession Planning process. Successors have been identified for critical positions (for N & N-1 level) in the Company and are being groomed for taking over higher responsibilities in the next 2-4 years through focused interventions.

• The Company is focused on Digitalization and Data excellence. The Digitalization function focuses on implementing technology driven processes and systems to streamline operations and thus improve overall organization efficiency. The Company has organized workshops / best practices session on data excellence to bring rigor to the data management aspects. Reverse digital mentoring sessions are organized to spread the digital knowledge using these applications to bring efficiency in the work.

• The Company has an instituted Policy on Prevention of Sexual Harassment (POSH), which seeks to govern the guidelines and grievance redressal procedures as required under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. As per policy, a Complaints Redressal Committee/Internal Complaints Committee exists in the Company with inclusion of an external lady member. POSH related sessions were conducted for employees and allied resources. No complaints related to POSH have been received during the year.

The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behaviour. In line with the Tata Code of Conduct (TCOC), any actual or potential violation, howsoever insignificant or perceived as such, would be a matter of serious concern for the Company. The role of the employees in pointing out such violations of the TCoC cannot be undermined.

Pursuant to Section 177(9) of the Act and Regulation 4(2)(d)(iv) of the Listing Regulations, a Whistle-blower Policy and Vigil Mechanism was established for Directors, employees and stakeholders to report to the Management instances of unethical behaviour, actual or suspected, fraud or violation of the Company's code of conduct or ethics policy. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chief Ethics Counsellor (CEC)/Chairman of the Audit Committee of the Company for redressal. The policy has been posted on the Company's website at https://www.nelco.in/pdf/Policies/Whistle%20Blower%20Vigil%20Mechanism%20Policy.pdf.

The Company afirms that no personnel have been denied access to the Audit Committee.

During the year CRISIL has reafirmed ratings for long term and short-term bank facilities of the Company to CRISIL A/Positive and CRISIL A1 respectively.

Details of LGSI covered under the provisions of Section 186 of the Act, 2013 are given in Annexure III forming part of this report.

(Rs in lakhs)

Members of the Company at the AGM held on 13^th August 2020, approved the appointment of S.R. Batliboi & Associates LLP (SRBA), Chartered Accountants, (ICAI Firm Registration No. 101049W/E300004), as the statutory auditors of the Company for a period of 5 years commencing from the conclusion of the 77^th AGM held on 13^th August 2020 until the conclusion of 82^nd AGM of the Company to be held in the year 2025.

Pursuant to the provisions of Sections 139, 142 and other applicable provisions, if any, of the Act (including any statutory modification or re-enactment thereof for the time being in force) and the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, SRBA are proposed to be re-appointed as Statutory Auditors of the Company for a second term of five years to hold office from the conclusion of the 82^nd AGM till the conclusion of the 87^th AGM to be held in the calendar year 2030, subject to approval of Members in the ensuing AGM. The necessary resolution for re-appointment of SRBA as Statutory Auditors form part of the Notice convening the ensuing AGM.

The standalone and the consolidated financial statements of the Company have been prepared in accordance with applicable Indian Accounting Standards (Ind AS) notified under Section 133 of the Act. The Statutory Auditor's report does not contain any qualifications, reservations, adverse remarks or disclaimers. The Notes to the Accounts referred to in the Auditors' report are self-explanatory and therefore do not call for any further clarification under section 134(3)(f) of the Act.

During the year under review, neither the statutory auditors nor the secretarial auditors has reported to the Audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Board's report.

Your Board has appointed P. D. Dani and Associates (Firm Registration No. 000593), Cost Accountants, as Cost Auditors of the Company for conducting cost audit for the FY 2024-25. A resolution seeking approval of the Members for ratifying the remuneration of Rs 1,25,000 (Rupees One Lakh Twenty-Five thousand) plus GST and reimbursement of out-of-pocket expenses on actual basis payable to the Cost Auditors for FY25 is provided in the Notice to the ensuing 82^nd AGM. As specified by the Central Government under sub-section (1) of section 148 of the Act, the Company has maintained the requisite cost accounts and records during the period under review.

In terms of Section 204 of the Act and Rules made thereunder, Bhandari & Associates, Practicing Company Secretaries (Peer Review No. 6157/2024), were appointed as Secretarial Auditor of the Company to carry out the secretarial audit for FY 2024-25. The report of the Secretarial Auditor for FY 2024-25 is enclosed as Annexure- IV forming part of this

Report. There has been no qualification, reservation or adverse remarks in the Report of the Secretarial Auditors. As per the requirements of the Listing Regulations, Practicing Company Secretaries have undertaken secretarial audit for FY 2024-25 of Nelco Network Products Ltd., the material unlisted subsidiary of the Company. As per the Audit Report (Annexure- IV-A) the said subsidiary had complied with the applicable provisions of the Act, Rules, Regulations, and Guidelines and that there were no deviations or non-compliances.

Pursuant to the provisions of Section 204 and other applicable provisions, if any, of the Act (including any statutory modification or re-enactment thereof for the time being in force) and the rules made thereunder, as amended from time to time and pursuant to the Regulation 24A of the Listing Regulations, as amended, Bhandari & Associates are proposed to be appointed as Secretarial Auditor of the Company for a term of five consecutive financial years, commencing from the financial year 2025-26, subject to the approval of Members in the ensuing AGM. The necessary resolution for appointment of Bhandari & Associates, as Secretarial Auditor form part of the Notice convening the ensuing AGM. Secretarial Standards: The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

The information on conservation of energy and technology absorption stipulated under Section 134 (3) (m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014, is given in Annexure – V forming part of this report.

In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy on Related Party Transactions and the same is available on the Company's website: https://www.nelco.in/pdf/Policies/ Related%20Party%20Transaction%20Policy.pdf All related party transactions entered during the year under review were on an arm's length basis and were in the ordinary course of business. All transactions with related parties were reviewed and approved by the Audit Committee. Prior omnibus approval is obtained for related party transactions which are of repetitive nature and entered in the ordinary course of business and on an arm's length basis. There were no other materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel and Body Corporate(s) which had a potential conflict with the interest of the Company at large. Accordingly, the disclosure of these Related Party Transactions as required under Section 134 (3) (h) of the Act in Form AOC 2 is not applicable for the year under review. The details of the transactions with related parties are provided in the accompanying Financial Statements.

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the Financial Statement.

Pursuant to Section 92 of the Act read with the applicable Rules, the Annual Return for the year ended 31^st March 2025 can be accessed on the Company's website at the following link:https://www.nelco.in/investor-relation/disclosures-under-regulation46-of-the-sebi-lodr/annual-return.php#

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal auditors, statutory auditors, cost auditors, secretarial auditors and external agencies 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 the period under review.

Accordingly, pursuant to Section 134(5) of the Companies Act 2013, the Board of Directors, to the best of their knowledge and ability, confirm that: a) in the preparation of the annual accounts for the year ended 31^st March 2025, the applicable accounting standards had been followed along with proper explanation relating to material departures; b) they have, in the selection of the accounting policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the Company for the period ended 31^st March 2025 and of the profit of the Company for that period; c) they have taken proper and sufficient care 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) they have prepared the annual accounts under review on a going concern basis; e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

During the year under review, there has been no change in the nature of business of the Company. Further, there has been no details, which shall be required to be given as regard to difference between amount of the 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, as no such events have occurred.

The Board of Directors thank the Company's shareholders, customers, vendors, business partners, bankers and financial institutions for their continuous support.

The Directors also thank the Government of India, Dept. of Telecommunications, Dept. of Space, various Ministries, Regulatory Authorities, and their departments for co-operation. We appreciate and value the contributions made by all our employees.

On behalf of the Board of Directors