Zen Technologies Ltd

Dear Members,

The Board of Directors presents the Company's Thirty Second Annual Report and the Company's Audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31,2025.

The financial highlights of the Company are as follows:

(Rs in Lakhs)

The Company's operations have been further discussed in detail in the Management Discussion and Analysis Report.

Your Company recorded net sales of Rs 93,066.72 Lakhs in FY 2024-25, against Rs 43,027.51 Lakhs in the previous year, registering a 116 per cent year-on-year growth. Your Company has delivered a robust growth in profits. EBITDA grew to Rs 37,150.54 Lakhs, up from Rs 19,116.17 Lakhs in FY 2023-24, marking a robust 93.63 per cent year-on-year growth. The EBITDA margin stood at 38 per cent, demonstrating improved operational leverage and cost efficiency. The profit before tax for the year was Rs 35,199.05 Lakhs compared with Rs 18,440.96 Lakhs in the previous year, which is a 90.87 per cent year-on- year increase.

In view of the overall performance of the Comapny, while retaining capital to support future growth and in line with the Dividend Distribution Policy, the Board at its meeting held on May 17, 2025, recommended a final dividend of Rs 2 per equity share of Rs 1 each fully paid (i.e., 200% of the face value), subject to the approval of members at the ensuing 32^nd Annual General Meeting (the "AGM"). The dividend, if approved at the AGM will be paid to those members whose names appear on the register of members of the Company as of end of the day on August 15, 2025 ("Record Date"). The total dividend payout will be approximately Rs 1,800 Lakhs (including tax). In terms of the provisions of the Income Tax Act, 1961, dividend income is taxable in the hands of the members, and therefore will be subject to deduction of applicable tax.

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the Dividend Distribution Policy, is available on the Company's website at https://www.zentechnologies. com/investor_relations/zen-dividend-distribution-policy.pdf

The Company has not transferred any amount to reserves during the year under review.

The Authorized Share Capital of the Company is Rs 2,000 Lakhs divided into 20,00,00,000 equity shares of Rs 1 each. During the year under review, there has been no change in the Authorized Share Capital.

During the year under review, pursuant to the approval of shareholders by way of postal ballot on March 08, 2024, the Company had allotted 62,46,096 equity shares of face value of Rs 1 each to Qualified Institutions Buyers (QIBs) at Rs 1,601 per equity share aggregating to Rs 1,00,000 Lakhs.

Accordingly, there was an increase in paid up share capital by Rs 62.46 Lakhs, consequent to allotment of shares to QIBs. Total paid up share capital of the Company as on March 31,2025 was Rs 902.90 Lakhs.

The Company has implemented "Zen Technologies Limited Employee Stock Option Plan-2021" ("ESOP-2021 Scheme") and the Company has made grants under ESOP-2021 Scheme to the eligible employees of the Company. The Nomination and Remuneration Committee of the Board of Directors of the Company, inter alia, administers and monitors the ESOP- 2021 Scheme. There has not been any material change in the ESOP-2021 Scheme during the financial year under review. The ESOP-2021 Scheme and its implementation is in line with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SEBI (SBEB & SE) Regulations") as amended thereof.

The disclosures pursuant to SEBI (SBEB & SE) Regulations is hosted and available on the Company's website and the same is available for electronic inspection by the Members during the AGM. The web-link for the same is https://www.zentechnologies.com/general-meeting-notices.

Further, a certificate from the Secretarial Auditors of the Company as prescribed under SEBI (SBEB & SE) Regulations shall be placed before the members in the AGM.

During the year under review, the Company raised Rs 1,00,000 Lakhs through a Qualified Institutions Placement (QIP). Pursuant to the approval of the Board in its meeting held on January 27, 2024 and the approval of the Members of the Company through postal ballot on March 08, 2024, the Company had issued and allotted 62,46,096 Equity Shares of face value Rs 1 each at a price of Rs 1,601 per equity share, including a premium of Rs 1,600 per Equity Share aggregating to Rs 1,00,000 Lakhs to Qualified Institutional Buyers on August 23, 2024.

During the year under review, the Company did not accept any deposits from the public within the ambit of Section 73 of the Companies Act, 2013, and the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification/s or re-enactment/s thereof) for the time being in force.

Details of subsidiary and associate companies as on March 31,2025 are tabulated below:

* Acquired during the year under review

Further no subsidiary Company ceased to be the subsidiary of the Company during the year under review. There are no joint venture companies within the meaning of Section 2(6) of the Companies Act, 2013.

The Company has formulated a Policy for determining Material Subsidiaries. The Policy is available on the Company's website at https://www.zentechnologies.com/policies-and-code-of-conduct

In line with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of the Company's subsidiaries and associates in Form AOC-1 have been provided in Annexure I to this Report. This form highlights the financial performance of each subsidiary and associate Company and their contribution to the Company's overall performance as required by Rule 8(1) of the Companies (Accounts) Rules, 2014.

Further, pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statements of the Company, including the consolidated financial statements, along with the relevant documents and the separate audited financial statements in respect of subsidiaries are made available on the website of the Company at https://www.zentechnologies. com/investor-information.

Brief details of the performance of the subsidiaries of the Company are given below:

Unistring Tech Solutions Private Limited (UTS) is a material subsidiary of the Company and is engaged in the business of design and development of various products in Electronic Warfare (EW), Communication and RADAR applications. UTS offers services to Government and private clients in the area of EW systems (ESM, COMINT, ELINT & Jammers), RADARs, Drone based EW systems, command links, EW and Radar Target Simulators.

During the year under review, UTS's revenue from operations was Rs 17,437.42 Lakhs for the year ended March 31,2025, and Profit after tax was Rs 3,943.93 Lakhs.

Applied Research International Private Limited (ARIPL) is a material subsidiary of the Company and is engaged in the business of (i) providing simulation and assessment tools for the marine, offshore, naval, ports & terminals, construction and mining industries; (ii) providing services relating to maintenance, certification, assessment solutions with respect to (i) above; (iii) fleetview monitoring of ships; and (iv) maintenance and module development for egovernance of DG Shipping of India.

During the year under review, ARIPL's revenue from operations was Rs 13,739.27 Lakhs for the year ended March 31,2025, and Profit after tax was Rs 745.33 Lakhs.

ARI Labs Private Limited (ALPL) is a wholly owned subsidiary of the Company and is engaged in the business of providing simulation and assessment tools for the marine and naval industries.

During the year under review, ALPL's revenue from operations was Rs 44.34 Lakhs for the year ended March 31,2025, and Loss for the year was Rs 10.15 Lakhs.

Vector Technics Private Limited (Vector), is a subsidiary of the Company and engaged in the business of providing propulsion and power distribution solutions for drones and UAVs. Its current product portfolio includes BLDC motors, electronic speed controllers (ESCs), propellers, and starter generators— key components used in drones, UAVs, and robotic systems.

During the year under review, Vector's revenue from operations was Rs 99.00 Lakhs for the year ended March 31,2025, and Loss for the year was Rs 315.67 Lakhs.

AiTuring Technologies Private Limited (ATPL) is a subsidiary of the Company. ATPL is pioneers in the field of robotics, integrating sophisticated technologies and specializes in providing cutting-edge solutions in the field of Remote Controlled Weapon Stations (RCWS) and Optronics for a wide range of weapon platforms, ranging from 5.56mm to 12.7mm calibers.

During the year under review, ATPL's revenue from operations was Rs 236.30 Lakhs for the year ended March 31,2025, and Loss for the year was Rs 33.26 Lakhs.

Zen Technologies USA, Inc is a wholly-owned subsidiary of the Company in USA and is engaged in the business of simulator industry, which complements the parent Company's core competencies. Zen Technologies USA is primarily dedicated to offering combat training products to defense and security customers worldwide. It incurred a net loss of USD 5.14 Lakhs for the year ended March 31,2025.

Zen Medical Technologies Private Limited (ZMTPL) is a wholly- owned subsidiary of the Company in India. Zen Medical is primarily involved in the field of medical and hospital equipment. It incurred a net loss of Rs 2.22 Lakhs for the year ended March 31,2025.

Zen Defence Technologies L.L.C, UAE (ZDT) is a wholly-owned subsidiary in UAE and is engaged in the business of import and export of training equipment and simulators, as well as in trading, development, and maintenance of defense and surveillance systems on a global scale. It incurred a net loss of AED 2.65 Lakhs for the year ended March 31,2025.

Details of investments made and/or loans or guarantees given and/or security provided, if any, are given in the notes to the Standalone and Consolidated financial statements which form part of the Annual Report.

During the year under review, the Board of Directors of the Company, based on the recommendations of the Nomination and Remuneration Committee, by the resolution passed through circulation on March 29, 2025 approved the appointment of Mr. Durga Prasad Kode (DIN: 07946821) as a Non-Executive Independent Director of the Company for a term of 3 (three) consecutive years i.e., from March 28, 2025 to March 27, 2028, not liable to retire by rotation and the same was approved by the members of the Company through postal ballot on May 13, 2025.

The Board opined that the above Independent Director possessed requisite experience and expertise (including the proficiency).

Dr. Ravindra Kumar Tyagi (DIN: 01509031), Non-Executive Independent Director of the Company has completed his second term of directorship on March 31, 2025 and consequently he ceased to be an Independent Director of the Company w.e.f. April 01,2025.

The Board of Directors and the Management of the Company placed on record their appreciation for the valuable contributions and guidance provided during his association with the Company.

Mrs. Shilpa Choudari (DIN: 06646539), Whole Time Director, is liable to retire by rotation at the forthcoming 32^nd AGM and being eligible, seeks re-appointment. For reference of members, a brief profile of Mrs. Shilpa Choudari is given in the Notice convening the 32^nd AGM.

During the year under review, the following directors/executives served as Key Managerial Personnel of the Company:

1. Mr. Ashok Atluri, Chairman and Managing Director

2. Mr. Kishore Dutt Atluri, President and Joint Managing Director

3. Mr. Ravi Kumar Midathala, Whole-Time Director

4. Mrs. Shilpa Choudari, Whole-Time Director

5. Mr. Afzal Harunbhai Malkani, Chief Financial Officer

6. Mr. Sourav Dhar, Company Secretary & Compliane Officer (w.e.f. November 02, 2024)

7. Mr. M. Raghavendra Prasad, Company Secretary & Compliane Officer (upto September 24, 2024)

The Board and Committee meetings are pre-scheduled and a tentative calendar of the meetings shall be finalised in consultation with the Directors to facilitate them to plan their schedule. However, in case of urgent business needs, approval is taken by passing resolutions through circulation. During the year under review, 4 (four) board meetings were held. The details of the meetings including the composition of various committees are provided in the Corporate Governance Report, which forms part of this Report.

In line with Section 149(7) of the Companies Act, 2013, each Independent Directors has confirmed to the Company that he or she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and complies with Rule 6(3) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 and Regulation 16( 1 )(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company. Furthermore, they have affirmed compliance with the code of conduct for Independent Directors as prescribed in Schedule IV of the Companies Act, 2013.

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity, possesses requisite expertise, experience and qualifications to discharge the assigned duties and responsibilities as mandated by the Companies Act, 2013 and SEBI Listing Regulations diligently.

Under the provisions of the Companies Act, 2013 and SEBI Listing Regulations, the Company has carried out the Board Evaluation process of the performance of the Board, Board Committees, Directors including Executive Directors, Independent Directors, and the Chairman. This exercise was carried out following the Company's Nomination and Remuneration Policy within the framework of applicable laws. The questionnaire and the evaluation process were reviewed in line with the SEBI guidance note and suitably aligned with the requirements.

While evaluating the performance and effectiveness of the Board, various aspects of the Board's functioning, such as adequacy of the composition and quality of the Board, time devoted by the Board to the Company's long-term strategic issues, the quality and transparency of Board discussions, and execution and performance of specific duties, obligations, and governance were taken into consideration. Committee performance was evaluated on their effectiveness in carrying out respective mandates, composition, the effectiveness of the committees, the structure of the committees and meetings of the committee from the Board, and its contribution to decisions of the Board. A separate exercise was carried out to evaluate the performance of Executive Director including the Chairman of the Board and Independent Directors, who were evaluated on parameters such as level of engagement and contribution to Board deliberations, independence of judgement, safeguarding the interests of the Company, focus on the creation of shareholder's value, ability to guide the Company in key matters, attendance at meetings, etc. The Directors expressed their satisfaction with the evaluation process.

The Board based on the recommendation of the Nomination and Remuneration Committee framed and adopted the Nomination and Remuneration Policy for selection, appointment and removal of Directors, Senior Management, Key Managerial Personnel ("KMP") including their remuneration. The Committee plays an important role in selection of Directors, Senior Management and KMP inter-alia including determination of qualifications, experience, expertise, and board diversity.

The Non-Executive Directors are remunerated by way of sitting fees for attending Board and Committee meetings.

The remuneration to a Whole-time Director/Executive Directors is broadly divided into fixed and variable components. The remuneration payable to them is subject to approval of the members of the Company.

For Senior Management, the remuneration is based on their performance, Company's performance, individual targets achieved, industry benchmark and compensation trends. Their remuneration consists of monthly salary, bonus, perquisites, KPI and other benefits

The Company's Nomination and Remuneration Policy is available at https://www.zentechnologies.com/policies-and- code-of-conduct

The Nomination and Remuneration Committee (NRC) shall assess the independence of directors at the time of appointment, re-appointment and the Board shall assess the same annually based on the criteria provided by NRC. The Board shall re-assess determination of independence when any new interests or relationships are disclosed by a Director.

A separate meeting of the Independent Directors was held on February 14, 2025, inter-alia, to discuss evaluation of the performance of Non-Independent Directors, the Board as a whole, evaluation of the performance of the Chairman, taking into account the views of the Executive and Non- Executive Directors and the evaluation of the quality, content and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of the Directors and the Board as a whole.

All the Independent Directors of the Company have been registered and are members of Independent Directors Databank maintained by the Indian Institute of Corporate Affairs (IICA).

In terms of Section 134(3)(c) of the Companies Act, 2013, the

Board of Directors of the Company states that:

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

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

c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

e) the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operative effectively; and

f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operative effectively.

All Directors and Senior Management Personnel have affirmed compliance with the Code of Conduct for the Board of Directors and Senior Management Personnel. A declaration to that effect is attached to the Corporate Governance report.

In terms of Section 118(10) of the Companies Act, 2013, the Company complies with Secretarial Standards 1 and 2, relating to the 'Meetings of the Board of Directors' and 'General Meetings', respectively as issued by the Institute of Company Secretaries of India ("ICSI") and approved by the Central Government.

As on March 31,2025, the Board has the following Committees:

i) Audit Committee

ii) Nomination and Remuneration Committee

iii) Stakeholders Relationship Committee

iv) Corporate Social Responsibility Committee

v) Risk Management Committee

vi) Borrowing Committee

vii) Investment and Finance Committee

The composition of the committees are as follows:

All the recommendations made by the Committees including the Audit Committee were accepted by the Board. A detailed update on the statutory Committees, its composition, terms of reference, number of meetings held and attendance of the Members at each meeting is provided in the Report on Corporate Governance.

The Company has procured D & O liability insurance policy that covers the members of the Board and Officers of the Company for such quantum and risks as determined by its Board of Directors.

The Company has in place a robust process for approval of Related Party Transactions ("RPTs") and dealing with Related Parties. The Company demonstrates a structured approach to manage RPTs. Transparency and oversight is ensured by providing detailed justifications to the Audit Committee and adhering to regulatory requirements (SEBI Master Circulars and SEBI Listing Regulations).

All related-party transactions (RPT) entered during the financial year were conducted in the ordinary course of business and on an arms-length basis. The Company, during the year, has not entered into any materially significant related-party transactions with Promoters, Directors, Key Managerial Personnel, or other persons that may have had a potential conflict with the Company's interests. All related-party transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is also obtained from the Audit Committee for repetitive related-party transactions that can be foreseen. The required disclosures are accordingly made to the Audit Committee every quarter regarding their omnibus approval.

Under Regulations 23(5) of SEBI Listing Regulations, as amended, approval of the Audit Committee is not applicable for the RPTs entered into between a holding Company and its wholly-owned subsidiary, and RPT entered into between two wholly owned subsidiaries of the listed holding Company, whose accounts are consolidated with such a holding Company and placed before the shareholders at the general meeting for approval. Since most Company's transactions are with its subsidiaries, omnibus approval of the Audit Committee is obtained for such transactions and is reviewed quarterly as a measure of good corporate governance.

The policy on the materiality of related-party transactions and on dealing with related-party transactions is in line with SEBI Listing Regulations, as amended, and is uploaded on the Company's website at https://www.zentechnologies.com/ policies-and-code-of-conduct.

In accordance with Section 134(3)(h) of the Companies Act,

2013, and Rule 8(2) of the Companies (Accounts) Rules,

2014, the particulars of the contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in Form AOC-2 is attached as Annexure II to this Report. The Company at the Annual General Meeting held on September 14, 2024 obtained approval of the Members for continuing/undertaking RPTs with Unistring Tech Solutions Private Limited which may exceed the materiality threshold, and which are in the ordinary course of business and on arms' length. Detailed disclosure on related party transactions as per IND AS-24 containing name of the related party and details of the transactions entered with such related party have been provided under Notes to financial statements. Disclosure on RPTs on half year basis are also submitted to the stock exchanges i.e BSE Limited and National Stock Exchange of India Limited.

The Company is committed to maintaining the highest standards of corporate governance and adhering to the corporate governance requirements set out by the Securities and Exchange Board of India (SEBI). The report on corporate governance as stipulated under the SEBI Listing Regulations forms an integral part of this report. The requisite certificate from the Secretarial Auditor of the Company confirming compliance with the conditions of corporate governance is attached to the report on corporate governance.

The Business Responsibility and Sustainability Report for the year under review, as stipulated under Regulation 34(2)(f) of the SEBI Listing Regulations, is presented in a separate section, forming part of the annual report.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed herewith as Annexure III to this report.

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended thereof, a statement showing the names and other particulars of the employees drawing remuneration over the limits set out in the said rules forms part of this report. Considering the first proviso to Section 136(1) of the Companies Act, 2013, the annual report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection by the members at the registered office of the Company or through electronic mode during business hours on working days up to the date of the forthcoming 32^nd AGM of the Company. Any member interested in obtaining a copy thereof may write to the Company Secretary at cosec@ zentechnologies.com in this regard.

The Company believes in upholding professional integrity and ethical behaviour in the conduct of its business. In terms of Section 177(9) of the Companies Act, 2013 and Regulation 22 of SEBI Listing Regulations and to uphold and promote these standards, the Company has a Whistle Blower Policy which serves as a mechanism for its Director(s) and employee(s) to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Code of Conduct without fear of reprisal. The policy also provides employee(s) access to the Chairman of the Audit Committee under certain circumstances. The details of the procedures are also available on the Company's website at https://www.zentechnologies.com/ policies-and-code-of-conduct

Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual Return as on March 31,2025 is made available on the Company's website at https://www. zentechnologies.com/annual-returns.

The Management Discussion and Analysis (MDA) for the year under review as stipulated under Regulation 34 of the SEBI Listing Regulations forms part of this Annual Report.

The Board formulated and implemented Risk Management Policy for the Company which identifies various elements of risks which in its opinion may threaten the existence of the Company and measures to contain and mitigate risks. The Company has adequate internal control systems and procedures to combat the risk. The Risk Management procedures are reviewed by the Audit Committee, Risk Management Committee and the Board on periodical basis.

The Company has adopted a Risk Management Policy in accordance with the provisions of the Companies Act, 2013 and Regulation 21 of the SEBI Listing Regulations and the same is also made available on the Company's website at: https:// www.zentechnologies.com/policies-and-code-of-conduct.

Pursuant to the provisions of Section 135 of the Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 ("CSR Rules"), as amended from time to time, the Company has constituted the CSR Committee of the Board which is chaired by an Independent Director. The Company has formulated and adopted a CSR policy which provides the focus areas (in accordance with Schedule VII of the Companies Act, 2013) under which various developmental initiatives are undertaken.

The Annual Report on CSR activities of the Company during fiscal 2025, in accordance with the CSR Rules, is attached as Annexure IV to this report. Further details on CSR activities also form part of this Annual Report.

The Company has an ongoing familiarization programme for all Independent Directors with regard to their roles, duties, rights, responsibilities in the Company, nature of the industry in which the Company operates, the business model of the Company, etc. The Company issues a formal letter of appointment to the Independent Directors, outlining their role, function, duties and responsibilities, the format of which is available on the Company's Website.

Further, various other programmes are conducted for the benefit of Independent Directors to provide periodical updates on regulatory front, industry developments and any other significant matters of importance.

The details of training and familiarization program are available on the Company's website at https://www.zentechnologies. com/investor-information.

M/s. Ramasamy Koteswara Rao and Co LLP, Chartered Accountants (Registration No: 010396S/S200084), were re-appointed as Statutory Auditors of the Company at the 31^st Annual General Meeting held on September 14, 2024, to hold office for a second term of 5 (five) consecutive years from the conclusion of that AGM till the conclusion of the 36^th Annual General Meeting of the Company to be held in the year 2029.

Pursuant to the provisions of Section 148(1) of the Companies Act, 2013 read with Companies (Audit & Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Amendments Rules, 2014, the cost records maintained by the Company are required to be audited.

The Board on the recommendation of the Audit Committee, has appointed M/s. M P R & Associates, Cost Accountants (Registration No: 000413) to audit the cost records of the Company for the FY 2025-26 at a remuneration of Rs 1,25,000 (Rupees One Lakh Twenty Five Thousands only) plus applicable taxes as well as reimbursement of reasonable out-of-pocket expenses at actuals. M/s. M P R & Associates have confirmed that their appointment is in compliance with the provisions of the Companies Act, 2013.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditors is required to be placed before the Members in a general meeting for ratification. Accordingly, a resolution seeking Member's ratification for the remuneration payable to M/s M P R & Associates Cost Auditors is included in the Notice convening the AGM.

The Cost Audit Report for the FY 2023-24 was filed with the Ministry of Corporate Affairs. The report was unmodified and did not contain any qualification or reservation or adverse remark or disclaimer. The Cost Audit Report for the FY 2024-25 will be filed before the due date.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Regulation 24A of SEBI Listing Regulations, as amended, the Board, subject to the approval of the shareholders, has appointed M/s. P S Rao & Associates, Practising Company Secretaries, (Registration No: P2001TL078000) a peer reviewed firm, to undertake the Secretarial Audit of the Company for a term of five consecutive years i.e. from FY 2025-26 to FY 2029-30. Accordingly, a resolution seeking Member's approval for the appointment of M/s P S Rao & Associates, Practising Company Secretaries, is included in the Notice convening the AGM.

The Secretarial Audit Report issued by M/s. P S Rao & Associates for the period under review in Form MR-3 is in Annexure-V to this Report. There are no qualifications, reservations or adverse remarks in the Secretarial Audit Report.

Mr. D S Rao, Practicing Company Secretary and Mrs.Sunita Verma, Practising Company Secretary, have undertaken a Secretarial Audit of the Company's material subsidiaries viz. Unistring Tech Solutions Private Limited and Applied Reaserch International Private Limited for the financial year 2024-25. The Audit report confirms that the material subsidiaries have complied with the provisions of the Companies Act, 2013, Rules, Regulations and Guidelines and that there were no deviations or non-compliance.

As required under Regulation 24A of the SEBI Listing Regulations, the reports of the Secretarial Audit are given as Annexure VA and VB to this report.

The Annual Secretarial Compliance Report for the FY 2024-25 has been submitted to the Stock Exchanges i.e BSE Limited and National Stock Exchange of India Limited within 60 days from end of the Financial Year ended March 31,2025.

As required by the SEBI Listing Regulations, a quarterly audit of the Company's Share Capital is being carried out by an Independent Practicing Company Secretary to reconcile the total share capital, the total share capital admitted with NSDL, CDSL and held in physical form, with the issued and listed capital. The Practicing Company Secretary's certificate in regard to the same is submitted to BSE Limited and National Stock Exchange of India Limited and is also placed before the Board of Directors.

There are no qualifications, reservations or adverse remarks by the Statutory Auditors in their report or by the Practising Company Secretary in the secretarial audit report. The emphasis on the matter and the key audit matters paragraphs are self explanatory and require no clarification.

There was no instance of fraud during the year under review, which required the Auditors to report to the Audit Committee and/or Board under Section 143(12) of the Companies Act, 2013 and the rules made there under.

Your Company has established and maintained a framework of internal financial controls and compliance systems. Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Company's internal financial controls were adequate and your Company is constantly endeavoring to improve the standards of internal control in various areas and taking steps to strengthen the internal control system to make it commensurate and effective with the nature of its business.

Further, the statutory auditors of your Company have also issued an attestation report on internal control over financial reporting (as defined in Section 143 of the Companies Act, 2013) for the financial year ended March 31, 2025, which forms part to the Statutory Auditor's Report.

Information under clause (m) of sub-section (3) of Section 134 of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is given in Annexure VI to this Report

No significant material orders passed by the regulators/courts/ tribunals would impact the Company's 'going-concern' status and future operations. However, members' attention is drawn to the statement on contingent liabilities and commitments in the notes forming part of the financial statements.

Your Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on Prevention of Sexual Harassment of Women at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has taken several initiatives across the organization to build awareness amongst employees about the Policy and the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 . An Internal Complaints Committee (ICC) has been constituted in compliance with the requirements of said Act to redress complaints received regarding sexual harassment. All employees are covered under this Policy.

The details of sexual harassment complaints as per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, and the Rules thereunder are provided in the Coporate Governance Report.

The Company adopted a Code of Conduct to Regulate, Monitor and Report Trading by Designated Persons and Immediate Relatives of Designated Persons pursuant the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code of practices and procedures for fair disclosure of unpublished price sensitive information and has been made available on the Company's website at https://www.zentechnologies.com/policies-and-code-of-conduct.

The Company is maintaining Structured Digital Database ('SDD'), for monitoring the dealings in the securities of the Company by the promoters, directors and designated persons including immediate relative and also to keep record of the persons with whom the unpublished price sensitive information of the Company has been shared internally or externally until it becomes public.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

During the year under review, there was no change in the nature of business of the Company.

There are no material changes and commitments affecting the financial position of the Company that have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the Report i.e. between March 31,2025 to May 17, 2025.

Pursuant to the provisions of the Section 124 of the Companies Act, 2013, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, declared dividends which remained unpaid or unclaimed for a period of seven years have been transferred by the Company to the IEPF, which has been established by the Central Government.

During the year under review, pursuant to the provisions of Section 124 (5) of the Companies Act, 2013, an amount of Rs 85,119 relating to FY 2016-17, which remained unclaimed for a period of 7 years was transferred to the Investor Education and Protection Fund by the Company in November, 2024.

Further, during the year under review, the Company transferred 11,650 equity shares to the Investor Education and Protection Fund relating to the investors who have not claimed any dividend from the last seven consecutive years.

The details of the investors whose dividend amount and shares are transferred are available on the Company's website https://www. zentechnologies.com/unpaid-unclaimed-dividend.

All the properties of the Company including buildings, plant and machinery and stocks have been adequately insured.

Industrial relations have remained cordial during the year under review, and your directors appreciate the sincere and efficient services rendered by the employees of the Company at all levels, contributing to the successful operations of the Company.

In commitment to keep in line with the Green Initiatives and going beyond it, electronic copy of the Notice of 32^nd Annual General Meeting of the Company including the Annual Report for FY 2024-25 are being sent to all members whose e-mail addresses are registered with the Company/Depository Participant(s)/RTA.

The web-links of various policies are provided herewith:

The Company has not made any such valuation during the FY 2024-25.

The Company has not made any application under the Insolvency and Bankruptcy Code, 2016 during the FY 2024-25.

Your directors thank various departments of Central and State Government, Organizations and Agencies for the continued help and co-operation extended by them to your Company. Your directors also gratefully acknowledge all the stakeholders of the Company viz. shareholders, customers, dealers, suppliers, vendors, financial institutions, banks, other intermediaries and business partners for the excellent support received from them during the year.

Your directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.