Vedant Fashions Ltd

for the Financial Year ended March 31, 2025

To,

The Members,

Vedant Fashions Limited

The Board of Directors of the Company hereby have pleasure in presenting the Twenty-Third Annual Report and the audited Annual Accounts on the business and operations of the Company for the year ended March 31, 2025 (“year under review”/ “FY 24-25”).

Financial Highlights

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

(INR in Million)

State of the Company's Affairs

During the year under review, the Company recorded Turnover of INR 13,864.83 million as against INR 13,675.32 million in the previous Financial Year 2023-24 (FY 23-24'). The profit before tax (PBT) was INR 5,194.96 million in FY 24-25 as against INR 5,484.06 million in FY 23-24. The Company reported strong profit after tax (PAT) margin of 28.02% and the PAT stood at INR 3,884.72 million during FY 24-25.

During FY 24-25, the Company continued its retail footprint expansion and successfully rolled out approximately 85 thousand square feet of net retail area. As of March 2025, the Exclusive Brand Outlets (EBOs) area, which is the dominant channel for the Company, stood at 1.79 million square feet, spanning 678 stores (including SIS) in 256 cities and towns globally. The Company continued to enhance customer experience through its omni channel presence supported by online (own website) and offline retail channels.

These brand-building efforts are underpinned by strong retail marketing, visual merchandising, and a customer- first orientation. Technology platforms such as Salesforce, Adobe Experience Cloud, and proprietary in-house solutions are enabling more personalized engagement, operational efficiency, and enhanced customer experience.

Your directors remain optimistic that this integrated and culturally attuned approach will continue to attract new customers, deepen loyalty, and strengthen brand equity, supporting the company's long-term growth trajectory.

The Company have been able to effectively maintain strong financial margins and profitability metrices. Your directors are happy to share that the fundamentals of the business have been sound and robust.

The National Company Law Tribunal, Kolkata Bench (‘NCLT') vide order dated November 11,2024 has sanctioned the Scheme of Amalgamation of Manyavar Creations Private Limited (‘MCPL' or ‘Transferor Company), a wholly owned subsidiary, with the Company and their respective shareholders and creditors under Section 230 to 232 of the Act. The Transferor Company was dissolved without winding-up and merger was effected from November 30, 2024, upon filing of certified copy of NCLT Order dated

November 26, 2024, in Form INC-28. Consequently, as at March 31, 2025, the Company has no subsidiary.

Amounts Transferred to Reserves

The Board of the Company has decided to retain the entire amount of its profit earned in FY 2024-25 in the Retained Earnings account only.

Dividend

Your Company has a dividend policy that balances the dual objectives of rewarding shareholders through dividends, whilst also ensuring the availability of sufficient funds for the growth of the Company. The Dividend Distribution Policy of the Company is available on the following weblink on the Company's website: https://www.vedantfash.ions. com/investors-category/corporate-governance/policies- practices/

The Board of Directors of your Company, after considering the above-mentioned objectives, has decided to recommend a final dividend of INR 8/- (Indian Rupees Eight only) per equity share of INR 1/- (Indian Rupee One only) each fully paid-up for the FY 2024-25. This dividend is subject to the approval of the shareholders at the ensuing annual general meeting and shall be subject to a deduction of tax at source.

Material Changes affecting the Financial Position of the Company

There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year to which these financial statements relate and date of this report. As such, no specific details are required to be given or provided.

Capital Structure of the Company

During the year under review, there was a change in the authorised share capital of the Company, resulting from the Final Order passed by the National Company Law Tribunal, Kolkata Bench, dated 11^th November 2024, owing to the amalgamation of Vedant Fashions Limited and Manyavar Creations Private Limited. The authorised share capital of the Company is H35,10,00,000 (Indian Rupees Thirty-Five Crores Ten Lakhs only), divided into 35,10,00,000 (Thirty- Five Crores Ten Lakhs only) equity shares of H1 (Indian Rupee One only) each.

During FY 24-25, the Company has allotted equity shares of H1 each as follows:

These allotments were made against the exercise of options by Eligible Employees/Participants in accordance with the VFL Employee Stock Option Scheme 2018. The equity shares so allotted rank pari-passu with the existing equity shares of the Company.

The Company did not issue equity shares with differential voting rights or any sweat equity shares during the year under review. As of 31^st March 2025, the paid-up equity share capital of the Company stood at H24,29,44,009, divided into 24,29,44,009 equity shares of H1 each, fully paid up.

Particulars of Employee Stock Option Scheme

Employees' Stock Options represent a reward system based on overall performance of the individual employee and the Company. The Company has framed an Employees Stock Option Plan with a view to attracting and retaining the best talent, encouraging employees to align individual performance with Company's objectives, and promoting increased participation by them in the growth of the Company. In accordance with the said Plan, the Company has introduced VFL Employee Stock Option Scheme 2018 (“the Scheme Pratham”), pursuant to the approval of the shareholders of the company at their extra-ordinary general meeting held on September 03, 2018, the amendment made in the same at their general meeting held on September 04, 2021 and ratified by passing a resolution in their annual general meeting held on September 08, 2022. No change was made in Scheme Pratham during the year under review and the said Scheme is in compliance with the relevant provisions of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 [“SEBI (SBEB & SE) Regulations”]. The detail of Employees' Stock Options forms part of the Notes to accounts of the Financial Statements for the year under review.

The disclosures as required under Regulation 14 of SEBI (SBEB & SE) Regulations have been placed on the website of the Company: https://www.vedantfashions.com/investors- category/reports-results/esop/

Changes in Directors and Key Managerial Personnel

There were no changes in the Directorships of the Company as well as in the Key Managerial Personnel of the Company during the year under review.

Mr. Ravi Modi, Chairman & Managing Director (DIN: 00361853), retires by rotation at the ensuing Annual General Meeting (AGM) pursuant to the provisions of Section 152 of the Act and is eligible for reappointment. Your directors recommend his reappointment.

The information prescribed by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘Listing Regulations') in respect of the above-named Director shall be given in the Notice of Twenty Third AGM.

Number of Board Meetings & Attendance

During the financial year 2024-25, 6 (Six) meetings of the Board of Directors of the Company were held, as per the details provided in the Corporate Governance Report forming part of Annual Report.

Number of Committee Meetings & Attendance

The details of the Committee Meetings and respective attendance of Members therein are provided in the Corporate Governance Report forming part of Annual Report.

Composition of Audit Committee

The Audit Committee constituted by the Board has Ms. Abanti Mitra as the Chairperson, Mr. Manish Mahendra Choksi and Mr. Ravi Modi as the members as on March 31, 2025. Further details are provided in the Corporate Governance Report. During the year all recommendations made by the Audit Committee were accepted by the Board.

Evaluation of the Board's Performance, Committee, and Individual Directors

The Company has devised a framework for performance evaluation of Board, its committees, and individual directors. The Nomination & Remuneration Committee carried out the evaluation of its own performance and that of its committees and the individual Directors, which was noted and taken on record by the Board. The performance evaluation of Non-Independent Directors, the Board as a whole and the Chairperson was carried out by the Independent Directors in their separate meeting.

The evaluation process consisted of structured questionnaires covering various aspects of the functioning of the Board and its Committees, such as composition, experience and competencies, performance of specific duties and obligations, governance issues etc. The Nomination & Remuneration Committee also carried out the evaluation of the performance of Individual Directors based on criteria such as contribution of the director at

the meetings, strategic perspective or inputs regarding the growth and performance of the Company etc., which was also noted by the Board.

Further, the performance evaluation criteria for the Independent Directors are disclosed in the Corporate Governance Report forming part of Annual Report.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 along with Section 164 and Regulation 16(1)(b) of the Listing Regulations. The Independent Directors have also confirmed that they comply with the Code of Conduct for Independent Directors as laid down under Schedule IV of the Companies Act, 2013. In the opinion of the Board, the Independent Directors hold highest standard of integrity and possess the requisite qualifications, experience, expertise, and proficiency.

Nomination and Remuneration Policy

A policy approved by the Nomination and Remuneration Committee and adopted by the Board is practiced by the Company for determining qualification, positive attributes, and independence of a director as well as for appointment and remuneration of Directors, Senior Management and other Employees, as per the details set out in the Corporate Governance Report. The policy has been placed on the website of the Company and the web link of the same is as follows: https://www.vedantfashions.com/investors-

category/corporate-governance/policies-practices/

Remuneration of directors and employees

Disclosure 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 (the Rules) is annexed and marked as Annexure I. The information pursuant to Rules 5(2) and 5(3) of the Rules not annexed to this Report, is readily available for inspection by the members at the Company's Registered Office between 10:30 A.M. to 1:30 P.M. on all working days up to the date of ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary, on complianceofficer@manyavar.com, whereupon a copy would be sent.

Human Resources

The Company has a workforce of 770 employees with a mix of people from different social, economic, and geographic backgrounds. The Company has maintained healthy, cordial, and harmonious industrial relations at all levels through proactive ER, development initiatives, gender diversity and community development.

Performance of the Company is anchored on its capabilities and productivity, customer-centric culture through a strong service orientation; happiness through purposeful behaviour by high-quality talent; value-oriented through a deep commitment to the values of Vedant Fashions Limited.

Directors' Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act 2013, your Directors confirm that:

a) in the preparation of the annual accounts for the financial year ended March 31, 2025, the applicable IND-AS have been followed and there is no notable material departures;

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 as of March 31, 2025 and of the profit 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 the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) the directors have prepared the annual accounts on a going concern basis;

e) the directors have laid down internal financial controls for the Company which are adequate and are operating effectively; and

f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. This has been done by identifying significant laws that are applicable to the Company.

Statement in Respect of Adequacy of Internal Financial Control with Reference to the Financial Statements

The Company has adequate internal financial control systems commensurate with its nature of business and size of the operations of the Company 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 and to monitor and ensure compliance with applicable laws, rules, and regulations.

The Company has also appointed an Internal Auditor as per the provisions of the Companies Act, 2013. The internal audit process covers all significant operational areas and reviews the Process and Control. The Internal Auditor has authority to verify whether the policies and procedures, including financial transactions, are carried

out in accordance with defined processes and variations and exceptions (if any) are justified and reported properly. The Statutory Auditor of the Company also gives their opinion on annual basis in their Audit Report regarding the adequacy and effectiveness of the Company's internal financial control with reference to financial statements.

Details in respect of report by Auditors under sub-section (12) of Section 143

During the year under review, there have been no frauds reported by the auditors of the company under subsection (12) of Section 143 of the Companies Act, 2013.

Details of Subsidiary, Joint Venture, or Associate

The Company had a wholly owned Subsidiary Company, namely Manyavar Creations Private Limited (MCPL) during the year under review, which has been amalgamated with the Company pursuant to a scheme of amalgamation (“Scheme”) approved under Sections 230 to 232 of the Companies Act, 2013. The Scheme was sanctioned by the Hon'ble National Company Law Tribunal, Kolkata Bench (“Hon'ble NCLT”), vide an order dated November 11, 2024. Further, there are no Associates or Joint Ventures during the year ended March 31, 2025.

Therefore, a report containing the details required under Section 134 of the Companies Act, 2013 (‘the Act') read with Rule 8(1) of the Companies (Accounts) Rules, 2014 is not applicable.

Deposits

The Company did not accept any deposits covered under Chapter V of the Companies Act, 2013 during the financial year ended March 31, 2025. Thus, there were no deposits which were unpaid or unclaimed and due for repayment, hence, there has been no default in repayment of deposits or payment of interest thereon.

Particulars of Loan, Guarantees and Investments under Section 186

The Company has not given/made any loans, guarantees and investments pursuant to the Section 186 of the Act during the year under review.

Particulars of Contracts or Arrangements with Related Parties

The particulars of contracts or arrangements entered into with related parties, referred to in Section 188(1) of the Companies Act 2013 during the FY 24-25 in the prescribed format (i.e., AOC-2) is attached with this report as Annexure II.

Corporate Social Responsibility (CSR) Policy

The Report as required under Section 135 of the Companies Act 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from

time to time, is attached as Annexure III to this Report. The brief outline of the CSR policy of the Company and the initiatives undertaken by the Company on CSR activities during the Financial Year under review are inter-alia set out therein. CSR Policy is available on the website of the Company at https://www.vedantfashions.com/csr.

Conservation of Energy, Technology, Absorption, Foreign Exchange Earnings and Outgo

The details of Energy, Technology, Absorption, Foreign Exchange Earnings and Outgo are as under:

• Conservation of Energy and Technology Absorption:

The various details under this head are as follows -

(A) Conservation of energy-

(i) the steps taken or impact on conservation of energy: The Company is endeavouring to reduce the GHG emissions from its own operations. It has energy efficient lighting and air conditioning system in place at their own premises. Moreover, in FY 2024-25, the Company purchased 850 verified carbon units (VCUs) to offset the total Scope 1 and 2 GHG emissions of 822.25 tCO2e in the FY 2023-24.

(ii) the steps taken by the company for utilising alternate sources of energy: The Company has reduced the number of vehicles which consume petrol/ diesel and have initiated the process of converting all its vehicles into electric vehicles.

(iii) the capital investment on energy conservation equipment: There has been no significant investment in this.

(B) Technology absorption-

(i) the efforts made towards technology absorption:

Our adoption of technology is driven by the need to improve efficiency, enhance customer experience, and stay competitive in a rapidly evolving market landscape. We are collaborating with the best technology providers to implement innovative solutions tailored to our needs.

(ii) the benefits derived like product improvement, cost reduction, product development or import substitution:

We prioritize using technology to optimize our supply chain management, inventory control, and customer relationship management systems, leading to improved efficiency and reduced expenses. It also allows us to leverage data analytics, enabling us to make data-

driven decisions that can lead to cost savings and increased profitability.

(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year): N.A.

(a) the details of technology imported: N.A.

(b) the year of import: N.A.

(c) whether the technology been fully absorbed: N.A.

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof: N.A.

(iv) the expenditure incurred on Research and Development: N.A.

• Foreign Exchange Earnings / Outgo:

Risk Management Policy

A Risk Management Policy to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating, and resolving risks associated with the Company's business has been adopted, which has been placed in the website of the Company at: https:// www.vedantfashions.com/investors-category/corporate- governance/policies-practices/.

The Risk Management Committee of the Board of Directors overviews the process of identification, monitoring, and review of all the elements of risk(s) associated with the Company. The detail of Committee and its terms of reference are elaborated in the Report on Corporate Governance which forms a part of this Report. The Company's management systems, organizational structures, processes, standards, code of conduct and behaviours together form the Risk Management System that governs how the Company conducts its business and manages associated risks. The Company has adequate risk management infrastructure in place capable of addressing those risks. The Company has also designated an employee as ‘Risk Manager' for the purpose of effective coordination of the risk management mechanism.

Disclosure on Establishment of a Vigil Mechanism

The Company has framed a Policy on Reporting Concerns so that Directors and employees can report their genuine concerns or grievance as and when they think fit. The Policy assures adequate safeguard against victimization of employees and directors who avail of the vigil mechanism policy. It also provides for action against frivolous complaints. This policy was communicated to all staff members of the Company for their knowledge

and information and was made available on Company's website in the name and style of “Vigil Mechanism Policy (or Whistle Blower Policy)” -

https://www.vedantfashions.com/investors-category/

corporate-governance/policies-practices/

Secretarial Standards

During the year under review, the Company has complied with Secretarial Standards on Meetings of the Board of Directors (“SS-1”) and on General Meetings (“SS-2”) as amended and issued from time to time by the Institute of Company Secretaries of India in terms of Section 118(10) of the Companies Act, 2013.

Statutory Auditors & Auditor's Report

M/s B S R & Co. LLP, Chartered Accountants (FRN: 101248W/W-100022), were appointed as the Statutory Auditors of the Company at the 20^th AGM of the Company held on 8^th September, 2022 to hold such office for a period of five years till the conclusion of the 25^th AGM.

The Auditor's Report on the financial statement for the year ended 31^st March, 2025 does not contain any qualification or adverse remark.

Web Link of Annual Return

As required under the Section 134 of the Companies Act, 2013, a copy of Annual Return (referred to in Section 92(3) of the Act) for the Financial Year 2024-25, has been placed at the Company's website in the following URL - https:// www.vedantfashions.com/investors-category/corporate- governance/annual-return/.

Disclosures under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013

The Company has zero tolerance towards discrimination and harassments including sexual harassment and always strives to create and provide a healthy environment in the workplace(s). It has in place a Policy for prevention of Sexual Harassment at the Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, and Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment, which operates in the name and style of “POSH Committee”. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year under review, no complaints with allegation of sexual harassment were filed with the ICC.

Internal Auditors

In terms of the provisions of the Companies Act, 2013 and Rules made thereunder, Grant Thornton Bharat LLP, Chartered Accountants, Kolkata, were reappointed as the Internal Auditors of the Company. During the year under

consideration, the Company continued to implement their suggestions and recommendations to improve the control environment.

Secretarial Auditor

Secretarial Audit has been conducted by Vivek Mishra & Co., a Firm of Company Secretaries, appointed by the Board and their report is annexed hereto and marked as Annexure IV. The Secretarial Audit Report does not contain any qualification, reservation, or adverse remark.

Listing fees

The listing fees for the financial year ending on March 31, 2026 have been duly paid.

General Disclosures

During the year under review:

(i) There has been no change in the nature of business of the Company and the Company continues to carry on its existing business.

(ii) There has been no voluntary revision of Financial Statements or the Board's Report.

(iii) No significant and material orders were passed against the Company by any regulators, courts or tribunal which impact Company's going concern status and its operations in future.

(iv) Maintenance of cost records, as specified by the Central Government under section 148(1) of the Companies Act, 2013, was not applicable to the Company. Hence, the provisions related to the appointment of the Cost Auditor are not applicable.

(v) No application has been made or any proceeding is pending under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the Financial Year is not applicable.

(vi) The requirement to disclose the details of difference between the amount of the valuation done at the time of onetime settlement and the valuation done while taking loans from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

Acknowledgment

The Board of Directors extend their heartfelt gratitude for the invaluable assistance and cooperation received from our esteemed stakeholders, including financial institutions, bankers, government and semi-government authorities, customers, and shareholders, during the year under review.

We also wish to formally acknowledge and deeply appreciate the dedicated services rendered by the Company's executives, staff, and workers.