V-Mart Retail Ltd

Dear Members,

The Board of Directors of your Company are pleased to present the 23rd Annual Report, along with Audited Financial Statements, for the financial year ended March 31, 2025.

Your Company's financial performance for the year under review is summarised below:

(Rs. in Lakhs)

In the financial year 2024-25, the Company's revenue from operations demonstrated a growth of 17%, reaching Rs. 3,25,386 Lakhs, compared to Rs. 2,78,560 Lakhs in the previous financial year 2023-24. The Company reported an Operating Profit (EBITDA) of Rs. 37,711 Lakhs for FY 2024-25, as against Rs. 21,305 Lakhs in FY 2023-24. The Company recorded a PAT of Rs. 4,577 Lakhs, in contrast to a net loss of Rs. (9,676) Lakhs reported in FY 2023-24.

A comprehensive analysis of the Company's operational performance, including insights into market conditions, business outlook, and the associated risks and concerns, is provided in the Management Discussion and Analysis Report.

The Company has undertaken significant initiatives to enhance its digital capabilities and optimize operational processes, thereby improving customer experience and overall business performance. During the financial year 2024 25, the Company pursued an expansion strategy that resulted in the opening of 62 new stores, primarily focusing on Tier II to IV markets and underserved regions, in alignment with its value retail approach. To enhance operational efficiency and customer experience, the Company integrated digital discovery tools with in-store merchandising, implemented more robust tech enabled operation management tools, deployed digital dashboards, facilitating improved real-time decision-making and productivity. Visual merchandising was also upgraded across various formats, while customer service was strengthened through multiple new initiatives.

In terms of product strategy, the Company adapted its offerings to address the evolving preferences of the youth demographic by emphasizing fashionable designs and superior quality. This focus contributed to customers under 25 years of age now constituting 32% of the customer base. To better serve this segment, the Company introduced merchandise tailored to Generation Z and expanded into new categories including electronic wearables and beauty products, while successfully improving inventory health.

From a technology and governance standpoint, the Company enhanced its CRM and inventory management systems to improve visibility and control, alongside launching digital pilot projects to monitor store openings and maintenance activities. Sustainability initiatives included the reuse of over 80% of cartons, digitization of store processes, and advancement of Environmental, Social, and Governance (ESG) goals through improved resource utilization and process governance. The Company maintained a strong Google rating of 4.8 and resolved 97% of customer complaints within 24 hours.

Furthermore, the Company placed significant emphasis on people and culture by strengthening frontline employee engagement through structured feedback mechanisms, recognition programs, and optimized scheduling. These efforts fostered empathetic leadership and cultural alignment, contributing to enhanced employee retention and performance. In recognition of these initiatives, the Company was honoured as a Top Employer in Retail by Ambition Box and ranked 23rd among India's Top 50 Future-Ready Employers.

Keeping in mind the continued cash availability for planned future expansion, the Board of Directors has decided not to recommend any dividend payment for the year under review.

During the year under review, the Company has transferred Rs. 6,317 Lakhs to reserves. Post transfer, the reserves stood at Rs. 79,038 Lakhs as on March 31, 2025.

Investment Information and Credit Rating Agency of India Limited (ICRA) has maintained the long-term rating of (ICRA) AA- (pronounced ICRA double A minus) and also maintained the short-term rating of [ICRA] A1+ (pronounced ICRA A one plus) assigned to the overall Rs. 300 Crores Line of Credit of your Company.

The credit rating of the Company as on March 31, 2025 is as under:

The Management Discussion and Analysis for the period under review as required under Schedule V read with Regulation 34(2) (e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been dealt with extensively in a separate section forming part of the Annual Report.

During the financial year 2024-25, the Company received widespread recognition through several prestigious awards and honours, reflecting its significant achievements across various domains within the retail sector. These accolades serve as a strong affirmation of the Company's unwavering commitment and continuous efforts to maintain a high standard of excellence year after year. The Significant Awards and Recognition received by the Company are as under:

? ICSI National Awards for Excellence in Corporate Governance, 2024

? LACP Vision 2023/24 Award in the Integrated Report Competition for the following categories: - Platinum Award in Consumer Durables - Textile/Apparel/Luxury - Among Top 50 Reports Worldwide - Technical Achievement Award

? Value Retailer of the Year 2024 by IReC

? Best Fashion Retailer 2024 by Economic Times Rajasthan

? Top Employer in Retail by Ambition Box

? 23rd among India's Top 50 Future-Ready Employers.

The Equity Shares of your Company continue to be listed on BSE Ltd. (BSE) and the National Stock Exchange of India Ltd. (NSE), and we have ensured the listing fees for the financial year 2025 are fully paid across all platforms where the equity shares of the Company are listed.

In accordance with Section 92(3) of the Companies Act, 2013, and Rule 12 of the Companies (Management and Administration) Rules, 2014, it is mandatory to display the Annual Return in the specified MGT-7 form on the Company's website. This document is to be made available at https:// vmart.co.in/other-disclosures/ following its submission to the Registrar of Companies (ROC).

In accordance with Regulation 34(3) of SEBI (Securities and Exchange Board of India) (Listing Obligations and Disclosure Requirements) Regulations, 2015, this report is accompanied by a comprehensive Report on Corporate Governance as stipulated under the Listing Regulations, which forms an integral part of the Annual Report.

The Board met 5 (five) times during the Financial Year 2024-25. The meeting details are provided in the Corporate Governance Report that forms part of the Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

As part of its commitment to good governance and regulatory compliance, an annual performance evaluation of the Board, its Committees, and individual directors was conducted during the year. The outcomes of this evaluation were shared with both the Committee and the Board.

The assessment followed the criteria and framework developed by the Nomination & Remuneration Committee, in line with the Companies Act, 2013, and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Additionally, the Board evaluation for the year was independently reviewed by an external agency, and the validation certificate is included in the Corporate Governance Report. The evaluation parameters and methodology are also described in the Corporate Governance Report.

As on March 31, 2025, the Board of Directors consists of 6 (six) members, of which three are Independent Directors including one woman Independent Director.

Pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company appointed Ms. Shweta Kumar (DIN: 08596612) and Mr. Raghuvesh Sarup (DIN: 10626162) as Additional Directors in the capacity of Non-Executive Independent Directors with effect from May 14, 2024. At the Annual General Meeting dated July 31, 2024, the shareholders approved their appointments, and both Mr. Raghuvesh Sarup and Ms. Shweta Kumar were appointed as Non-Executive Independent Directors for a term of five years, effective from May 14, 2024, to May 13, 2029 and not liable to retire by rotation. The tenure of Mr. Aakash Moondhra (DIN: 02654599) as an Independent Director concluded on 22nd September 2024, following the completion of his second term of five consecutive years. Further, at the Annual General Meeting held on 31st July 2024, he was appointed as a Non-Executive Non-Independent Director for a term of five (5) years, w.e.f. 23rd September 2024 and he is liable to retire by rotation.

Additionally, the tenure of Mr. Murli Ramachandran (DIN: 00264018) and Ms. Sonal Mattoo (DIN: 00106795) as Independent Directors of the Company ended on January 21, 2025. Both individuals, initially appointed on January 22, 2015, and re-appointed thereafter, ceased to be Independent Directors at the close of business on that date.

In accordance with the provisions of Section 152 of the Companies Act, 2013, Mr. Lalit Agarwal (DIN: 00900900) is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board of Directors recommends his re-appointment and the matter is being placed for the approval of members at the ensuing Annual General Meeting of the Company. None of the Directors of the Company have resigned during the year under review.

In pursuance of section 2 (51) and 203 of the Companies Act, 2013, the Key Managerial Personnel ("KMP") of the Company are as follows:

Mr. Lalit Agarwal, Managing Director, Mr. Madan Gopal Agarwal, Whole-time Director, Mr. Anand Agarwal, Chief Financial Officer and Ms. Megha Tandon, Company Secretary.

During the year under review, there were no changes to the Key Managerial Personnel ("KMP") of the Company.

The Company has, inter alia, received the following declarations from all the Independent Directors confirming that:

a. they meet the criteria of independence as prescribed under the provisions of the Act, read with Schedule IV and Rules issued thereunder, and the Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company;

b. they have complied with the Code for Independent Directors prescribed under Schedule IV to the Act; and

Further, they have confirmed that they have registered themselves with the Independent Director's Database maintained by the Indian Institute of Corporate Affairs.

The Board of Directors of the Company has taken on record the declaration and confirmation submitted by the Independent Directors after undertaking due assessment of the veracity of the same.

None of the Director of the Company are disqualified from being appointed as Directors as specified under Section 164(1) and 164(2) of the Act read with Rule 14(1) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 (including any statutory modification(s) and/or re-enactment(s) thereof for the time being in force) or are debarred or disqualified by the Securities and Exchange Board of India ("SEBI"), Ministry of Corporate Affairs ("MCA") or any other such statutory authority.

All members of the Board and Senior Management have affirmed compliance with the Code of Conduct for Board and Senior Management for the financial year 2024-25.

During the year, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than payments towards the sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

The Company has implemented a Nomination & Remuneration Policy to ensure the composition of a proficient Board. The Nomination & Remuneration Committee identifies gaps in required competencies, evaluates potential candidates, and recommends eligible members for appointment.

The Committee is responsible for filling vacancies on the Board as necessary. Once selected, candidates are invited to join the Board, subject to the approval of Shareholders.

Furthermore, the Nomination & Remuneration Committee has the responsibilities, which includes:

1. Identifying candidates qualified to serve as directors or senior management personnel.

2. Determining the tenure of Independent Directors, including decisions regarding the continuation or extension of their terms based on performance evaluation reports.

3. Formulating a comprehensive remuneration policy for directors, senior executives, and employees, encompassing ESOPs, pensions, and other compensatory benefits.

The Company's policy on the appointment and remuneration of Directors covering criteria for qualifications, positive attributes, independence of Directors, and other considerations as per the provisions of Section 178(3) is appended to this Report as Annexure A.

Independent Directors undergo a familiarisation programme on the Company's operations and functioning upon their appointment. They are continually updated on the Company's activities and developments to remain well-informed about its affairs. Detailed information regarding the induction and familiarization program is included in the Corporate Governance Report and is also accessible on the Company's website at https://vmart.co.in/corporate-governance/.

Note: The Warehouse Committee of the Company stands dissolved w.e.f. October 29, 2024.

A detailed note on the Board and its Committees is provided under the Corporate Governance Report forming part of the Annual Report.

a. Buy-Back of Securities: During the year under review, the Company has not undertaken any buy-back of its securities.

b. Issue of Sweat Equity: The Company has not issued any sweat equity shares during the year under review.

c. Issue of Bonus Shares: The Company has not issued any bonus shares during the Financial Year 2024-25.

d. Employees Stock Option / Restricted Stock Units: The

Details pertaining to the ESOP is available on the website of the company and the same details are accessible at this link. https://vmart.co.in/corporate-governance/.

The Authorized Share Capital of your Company as on March 31, 2025 stood at Rs. 25,00,00,000 (Rupees Twenty-Five Crores only) divided into 2,50,00,000 (Two Crores and Fifty Lakhs only) equity shares of Rs. 10/- (Rupees Ten only) each.

All transactions with related parties were reviewed and approved by the Audit Committee and were in accordance with the Related Party Policy of the Company.

All Related party transactions undertaken during the financial year were conducted at arm's length and in the ordinary course of business. There were no materially significant related party transactions with Promoters, Key Management Personnel, or other designated persons that could potentially conflict with the interests of the Company as a whole.

The Company has established a policy on Related Party Transactions, which can be accessed on its official website at the provided link.

https://vmart.co.in/wp-content/uploads/Related-Party-Transaction-Policy.pdf

The details of related party transactions entered during the year are provided in the accompanying financial statements. The particulars of the contract or arrangement with related parties referred in section 188(1) of the Companies Act, 2013 in the prescribed form AOC-2, prescribed under the provisions of Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014, is annexed as Annexure B to this report.

During the FY 2024-25, your Company has not accepted any deposits from the public falling under Section 73 and 76 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014, and as such no amount of principal or interest was outstanding as on the date of the Balance Sheet.

Loans, Guarantees & Investments covered under the provisions of Section 186 of the Companies Act, 2013, if any, form part of the notes to the financial statement provided this annual report.

There have been no such material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company which the financial statements relate and the date of the report.

However, the Board of Directors in its meeting held on May 02, 2025 has approved the following subject to approval of the Members of the Company:

a. Alteration of Capital Clause by Increasing the Authorised Share Capital of the Company from Rs. 25,00,00,000 (Rupees Twenty Five Crores Only) divided into 2,50,00,000 (Two Crores and Fifty Lakhs only) equity shares of Rs. 10/- (Rupees Ten only) each to Rs. 95,00,00,000 (Rupees Ninety Five Crores Only) divided into 9,50,00,000 (Nine Crores and Fifty Lakhs only) equity shares of Rs. 10/- (Rupees Ten only) each subject to approval of the Members of the Company.

b. Issue of Bonus Shares in the ratio of 3:1 i.e. 3 (three) new fully paid up equity shares of Rs. 10/- each (Rupees Ten Only) each for every 1 (one) existing fully paid-up equity share of Rs. 10/- (Rupees Ten Only) each, to the eligible equity shareholders of the Company as on the record date, subject to approval of the Members of the Company.

The Company does not have any Subsidiary, Joint Venture or Associate Company.

The Registered Office of the Company is situated at 610-611, Guru Ram Dass Nagar, Main Market, Opp. SBI Bank, Laxmi Nagar, New Delhi 110092.

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR Committee comprises of four members, namely Mr. Raghuvesh Sarup (Chairperson), Mr. Lalit Agarwal (Member), Mr. Madan Gopal Agarwal (Member) and Mr. Aakash Moondhra (Member). The Committee is responsible for formulating and monitoring the CSR policy of the Company. The CSR Policy is available on Company's website https://vmart.co.in/wp-content/uploads/2022/09/CSR-Policy.pdf

In accordance with Section 135(5) of the Companies Act, 2013, and its subsequent rules, the Company is mandated to allocate a minimum of 2% of its average net profits from the past three financial years towards Corporate Social Responsibility (CSR) initiatives, as calculated under Section 198 of the Companies in Act for the financial year 2025, the Company was not required to earmark funds for CSR activities as per the stipulated criteria.

Nevertheless, your Company has voluntarily contributed Rs. 13 Lakhs (Rupees Thirteen Lakhs Thirty Three Thousand only) to CSR projects, surpassing its statutory obligation. This exemplifies our commitment to social welfare beyond the mandatory requirements.

The brief outline of the Corporate Social Responsibility (‘CSR') Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year in the format prescribed in the Companies (‘CSR Policy') Rules, 2014 are set out in Annexure C of this Report.

Although our company doesn't consume large amounts of energy, sustainability remains a top priority. We continue to implement programs that reduce energy use, train employees, and maintain equipment efficiently. Our key supports eco-friendly infrastructure that integrates solar energy and energy-efficient design. We have significantly expanded our solar capabilities our 700 KWP rooftop solar installation at the distribution center now generates over 576 Lakhs kWh annually, offsetting CO2 emissions. Reduction in overall carbon emissions by transitioning to LED lighting and energy-efficient HVAC systems, Optimized the use of the Company's own fleet for return shipments and inter-store transfers (IST), reducing empty return trips by 60% and achieving significant cost savings while lowering environmental impact.

At our warehouses, solar energy adoption has led to estimated energy cost savings, reinforcing our commitment to operational efficiency and renewable energy. Water conservation also remains a focus: we continue to use rainwater harvesting at our Gurugram head office and employ float valves, treated wastewater reuse, and sewage treatment plants at our Palwal warehouse. Through the installation of RO wastewater recovery systems at 500 stores, we conserved over 73 Lakhs litres of water annually. These initiatives, along with the planting of over 13,950 trees to support ecosystem restoration, underscore our integrated approach to environmental responsibility. Further details are available in the Natural Capital part of the Annual Report.

As part of our ongoing digital transformation, several key initiatives have been implemented to enhance operational efficiency, customer experience, and data-driven decision-making. One such initiative is the rollout of the Product Lifecycle Management (PLM) system, which has streamlined product development by integrating data, costing, and sampling into a unified platform. To further strengthen supply chain efficiency, the Automated Replenishment System (ARS), now active across warehouses and stores, ensures timely stock refills by analyzing sales trends, effectively reducing stockouts and overstocking. In parallel, the Design to Display initiative digitizes the journey from product design to retail, enabling faster product launches and maintaining brand consistency across channels. On the workforce front, HR processes have been enhanced through an incentive management tool integrated with the HRMS app, allowing employees to track performance and category-specific targets in real time. Together, these initiatives have significantly boosted operational agility, empowered data-driven decisions, enhanced customer experience, and laid a robust foundation for scalable, technology-driven growth.

The Board of Directors has established a Code of Conduct applicable to its members and senior management personnel. This Code serves as a framework for ethical business practices, equitable treatment, and the prohibition of actions such as bribery, corruption, and anti-competitive behaviour.

During the financial year under review, the Code of Conduct was revised to redefine the scope of senior management and incorporate additional legal requirements.

All Board members and senior management personnel have confirmed their compliance with the Code of Conduct for the financial year 2024-25. A declaration affirming adherence to the Code of Conduct, signed by Mr. Lalit Agarwal, the Managing Director, is included in the Corporate Governance Report, which forms part of this Annual Report.

The Code is also available on the website of the Company at https://vmart.co.in/wp-content/uploads/V-Mart_Code-of-Conduct-for-Directors-SMPs_May-2024.pdf

The Company promotes ethical behaviour in all its business activities and is in line with the best governance practices. The Company has a robust vigil mechanism through its Whistle Blower Policy approved and adopted by the Board of Directors of the Company in compliance with the provisions of Section 177(10) of the Act and Regulation 22 of the Listing Regulations.

This Policy provides a structured framework for stakeholders, including Directors, Employees, Customers, Vendors, Associates, and Suppliers, to report any concerns regarding suspected fraud, violations of legal or regulatory obligations, breaches of the Company's code of conduct/policies, or incorrect or misrepresentation of any financial statements and reports.

The primary objective of Whistle Blower Policy are:

a. allow and encourage stakeholders to bring to the management's notice concerns about unethical behaviour;

b. provide protection against victimisation;

c. ensure timely and consistent organisational response; and d. build and strengthen a culture of transparency and trust.

The Policy is available on the website of the Company at https://vmart.co.in/wp-content/uploads/2023/07/Whistle-Blower-Policy.pdf

In accordance with SEBI Insider Trading Regulations, the Company has established a Code of Conduct to Regulate, Monitor, and Report Trading by Designated Persons ("Code of Conduct for Insider Trading") as well as a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information ("Code of Fair Disclosure"). These measures aim to prevent insider trading activities and ensure ethical management of sensitive information.

The Code for Prevention of Insider Trading is reviewed and amended suitably from time to time, to incorporate the amendments carried out by SEBI. The Code outlines the duties and responsibilities of Designated Persons (DPs), including the maintenance of a Structured Digital Database (SDD). This database serves as a crucial tool for preventing insider trading and managing Unpublished Price Sensitive Information (UPSI).

To enhance employee awareness and compliance, the Company periodically circulates informative emails and conducts periodic quiz on the Prevention of Insider Trading, outlining Do's and Don'ts and familiarizing employees with key aspects of the Code.

During the year under review, the Audit Committee evaluated the adequacy and effectiveness of the internal control systems related to the SEBI Insider Trading Regulations. It reviewed cases of non-compliance, if any, and recommended actions to the Board in line with the penalty framework. Any non-compliances are promptly reported to the Stock Exchanges in the prescribed format, and penalties, if applicable, are directly deposited by the Designated Person into SEBI's Investor Protection and Education Fund.

The Code of Conduct for Insider Trading and Code of Fair Disclosure have been uploaded on the Company's website at https://vmart.co.in/wp-content/uploads/Insider-Trading-Code-of-Conduct.pdf and https://vmart.co.in/wp-content/ uploads/2022/09/CODE.pdf .

All Directors and the designated person have confirmed compliance with the code.

The Company uses a robust online legal compliance management system to help ensure it follows all relevant laws and regulations that apply to its business. This system sends automatic reminders to the responsible teams, helping them complete their compliance tasks on time. Once a task is completed, it is verified by the assigned person and then reviewed by an approver to ensure accuracy. A central dashboard shows the status of all compliance activities and is regularly shared with department heads and the Compliance Officer for better tracking and oversight.

In addition, every quarter, a certificate along with detailed annexures confirming the Company's compliance with all applicable laws and regulations is presented to the Board of Directors. This certificate also includes details of any issues found, along with the steps taken to correct and prevent them in the future.

Your Company has implemented an integrated Risk Management framework that incorporates principles from COSO's Enterprise Risk Management, ISO 31000, and compliance with the requirements under the Companies Act and SEBI regulations. This comprehensive framework is strategically designed to manage a spectrum of risks, including financial, operational, strategic, compliance, and reputational. The Company is dedicated to enhancing its Risk and Governance framework continuously to fulfil its vision of becoming a prominent value retailer in Bharat. The framework is governed by the Board of Directors, employing both top-down and bottom-up approaches for seamless integration with business operations.

Pursuant to Regulation 21 of the Listing Regulations, the Board constituted Risk Management Committee to frame, implement and monitor risk management plan of the Company. The Board has adopted the Risk Management Policy and framework to mitigate foreseeable risks, avoid events, situations or circumstances, which may lead to negative consequences on the Company's businesses.

Additionally, we have recently revised the composition of the Risk Management Committee, which now consists solely of Independent Directors.

The detailed analysis of the business risks and opportunities is given under Management Discussion and Analysis Report, which forms part of this report.

V-Mart continued to invest in its people, recognising their critical role in driving scalable growth. It strengthened employee engagement through Town Halls, feedback platforms, focus groups, and skip-level meetings. Recognition initiatives included Employee of the Month, Gratitude Cards, peer appreciation, milestone celebrations, bonuses, revamped sales incentives, and Performance Linked Incentives (PLI). The company promoted internal mobility, job rotations, and leadership development, while coaching and mentoring supported high-potential talent.

Over 2,68,000+ hours of training were delivered, including leadership modules and UpGrad-led programmes. V-Mart supported employee well-being through health insurance, fitness and mental wellness programs, stress management workshops, flexible work options, and a strong focus on diversity and inclusion, reinforced by regular feedback.

The statement containing the names and other particulars of employees in accordance with section 197(12) of the Companies Act, 2013, read with rules 5(1) & 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure D to the Board Report.

The details of the employees of the Company employed throughout the financial year was in receipt of a remuneration of Rs 1.02 crores or more, or employed for the part of the year and in receipt of Rs 8.5 Lakhs or more a month under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are mentioned in Annexure D to this report.

For more details refer to Human Capital forming part of the Annual Report.

Our Company is dedicated to transparency and thorough reporting, as demonstrated by our voluntary Integrated Report. This report offers a comprehensive overview of the Company's performance, integrating both financial and non-financial information to support informed decision-making and enhance the Members' understanding of our strategic direction.

It provides an in-depth look into the core of our business activities, shedding light on our governance structure, strategic objectives, and ability to generate lasting value across the six capitals: financial, manufactured, intellectual, human, social and relational, and natural.

Our approach underscores our commitment to sustainable value creation and highlights the significance of engaging with our stakeholders, ensuring that our operations benefit all parties and contribute positively to the broader ecosystem.

Pursuant to the provisions of Section 139 of the Companies Act, 2013, S.R. Batliboi & Co. LLP, Chartered Accountants, (Firm Registration No. 301003E/E300005) were re-appointed as Statutory Auditors of the Company for the second term of five consecutive years, to hold office from the conclusion of the 21st Annual General Meeting held on September 15, 2023 until the conclusion of 26th Annual General Meeting of the Company to be held for the financial year 2027-28, on such remuneration as may be decided. Vide notification dated May 7, 2018 issued by the Ministry of Corporate Affairs, the requirement of annual ratification has been omitted.

Further, the Auditors' Report "with an unmodified opinion" , on the financial statements of the Company for financial year 2024-25, forms part of this Annual Report. There was no observation or qualification in the Auditor's Report. The Notes on Financial Statements referred to in the Auditors' report are self-explanatory and therefore do not require any further comments.

M/s. VKC & Associates, Company Secretaries, a partnership firm was appointed as Secretarial Auditors to conduct the Secretarial Audit of the Company for the FY 2024-25, pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the Listing Regulations.

The Secretarial Audit Report for the financial year 2024-25 under the Act read with Rules made thereunder and Regulation 24A of the Listing Regulations in form MR-3 is enclosed herewith as Annexure E to the Board's Report.

The Secretarial Compliance Report received for the financial year 2024-25, in relation to compliance of all applicable SEBI Regulations/ Circulars/Guidelines issued thereunder, Secretarial Standards, pursuant to the requirement of Regulation 24A of the Listing Regulations, The Annual Secretarial Compliance Report is available on the Company's website at the link: https://vmart.co.in/wp-content/uploads/ASCR.pdf

As part of our commitment to maintaining the highest standards of internal audit, we have engaged KPMG Assurance & Consulting Services LLP, a firm established under the Limited Liability Partnership Act, 2008, to carry out our internal audits.

KPMG, widely recognized for its expertise in Audit, Tax, and Advisory services, conducts thorough quarterly audits of our various business operations. The findings and recommendations from these audits are regularly reported to the Audit Committee, ensuring the ongoing improvement of our business practices.

This robust approach to internal auditing reflects our unwavering dedication to transparency and excellence in corporate governance.

None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013.

The Board has established comprehensive policies and procedures to ensure the orderly and efficient conduct of the Company's business. These include compliance with the Company's policies, protection of its assets, prevention and detection of fraud and errors, accuracy and completeness of accounting records, and the timely preparation of reliable financial disclosures. Details regarding the internal control and its effectiveness are provided in the Management Discussion and Analysis section, which is forms a part of Annual Report.

The Company actively tracks all changes in Accounting Standards, the Act, and other applicable regulations and makes changes to the underlying systems, processes, and financial controls to ensure adherence to the same. With increased business complexities, detailed accounting and financial treatment are decided for dealing with newer products, services, assets, commitments, contracts, and arrangements

There was no such order passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in the future during the year under review.

Your Company laid down an Anti-Sexual Harassment Policy in compliance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Committee (IC) has been set up to redress complaints regarding sexual harassment, if any.

As per the POSH Act, the composition of the IC Committee has been revised to ensure compliance. This revision was discussed and approved during the Board Meeting held on 29th October, 2024. The updated composition reflects our commitment to a safe and inclusive workplace.

The Revised Composition as on 31st March, 2025 are as follows:

The disclosures for the period under review as per the Anti-Sexual Harassment Policy of the Company and applicable Act thereof are as follows:

a) Number of complaints of sexual harassment received during the year: 8

b) Number of complaints disposed-off during the year: 8

c) Number of cases pending for more than ninety days: 0

d) Number of workshops on awareness program against sexual harassment carried out: 2

e) Nature of action taken by the employer or district officer:

A detailed investigation was carried out by the Company and the appropriate action was taken to resolve the matter.

The Company's Policy for prevention of sexual harassment is available on the Company's website at https://vmart.co.in/wp-content/uploads/Annexure-A-POSH-Policy.pdf.

The Company has ensured adherence to all applicable provisions under the Maternity Benefit Act, 1961.

No material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our auditors.

Pursuant to Sections 124 and 125 of the Companies Act, 2013 read with IEPF Authority (Accounting, Audit, Transfer & Refund) Rules 2016 ("IEPF Rules"), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by Central Government after completion of seven years.

Further, all shares in respect of which dividend has not been paid or claimed for seven consecutive years or more are required to be transferred by the company in the name of Investor Education and Protection Fund.

Further details of unpaid or unclaimed dividends and shares are provided on our website at https://vmart.co.in/ shareholding-information/

Your company is dedicated to strong Environmental, Social, and Governance (ESG) practices to ensure long-term sustainability and value creation. We have implemented comprehensive initiatives across all areas of our operations. These include energy efficiency measures, waste management, conservation, and social programs supporting community welfare and diversity. Additionally, we maintain stringent governance practices to ensure compliance and ethical conduct. Our commitment to these ESG efforts reflects our dedication to responsible growth and a positive impact on our stakeholders and the environment.

For more details refer to ESG Page forming part of the Annual Report.

As stipulated in terms of the provisions of Regulation 34 of SEBI (Listing Obligation & Disclosure Requirements) Regulations, 2015 the Business Responsibility & Sustainability Report describing the initiatives undertaken by the Company from environmental, social and governance perspective is presented in a separate section forms part of the Annual Report.

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of section 148(1) of the Companies Act, 2013 are not applicable to the business activity carried out by the Company.

Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 ("the listing regulations"), the top 1000 listed companies shall formulate a dividend distribution policy. Accordingly, the policy was adopted to set out the parameters that will be taken into consideration by the Board of the Company in determining the distribution of dividends to its shareholders and/or retaining profits earned the Company. The policy is available on the Company's website at the link: http://vmart.co.in/wp-content/uploads/2023/07/ Dividend-Distribtion-Policy-1.pdf.

No application has been made or any proceeding is pending under Insolvency and bankruptcy Code, 2016.

The Company has not taken any term loans from any Bank. No one time settlement has been made by the Company during the year under review.

During the year under review, your Company has complied with all applicable secretarial standards issued by the Institute of Company Secretaries of India and approved by the Central Government pursuant to Section 118(10) of the Companies Act, 2013.

Pursuant to Section 134(3) (c) of the Companies Act, 2013, the Directors hereby state and confirm that:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from the same.

b) The Directors have 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 financial year and of the profit or loss of the Company for that period.

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis.

e) The Directors have laid down Internal Financial Controls to be followed by the Company and that such internal financial controls are adequate and operating effectively.

f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

The aforesaid statement has also been reviewed and confirmed by the Audit Committee of the Board of Directors of the Company

Your Directors take this opportunity to express their sincere appreciation for the excellent support and coordination extended by the employees, shareholders, customers, suppliers, bankers, and all other business associates.

Your Directors gratefully acknowledge the ongoing cooperation . and support provided by Central Government, State Governments, and all regulatory authorities.

Your Directors also appreciate and value the contribution made by every member of the V-Mart family.