Ajooni Biotech Ltd Directors Report

2. REVIEW OF OPERATION

In the financial year 2024-2025 revenue from operations of your Company was Rs. 1,14,69,18,775/- as compared to the last year of Rs. 80,11,45,734/-. During the financial year 2024-25, the Company earned a profit of Rs. 3,37,19,234/- against the profit of Rs. 2,16,11,778/- during the previous year 2023-24. Your Directors expect to achieve better performance in the future taking maximum efforts to control the costs and optimize the results in the coming years.

3. TRANSFER TO RESERVES

The company has transferred Rs. 3,37,19,234/- being the profit for the current financial year to Reserves & Surplus Account.

4. CHANGE IN NATURE OF BUSINESS

There is no change in the nature of the business of the Company.

5. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

During the year under review, the company has obtained in principle approval from NSE (National Stock Exchange) on 30^th January, 2024 for the allotment of Equity Shares aggregating upto Rs. 40 Cr on Rights Issue basis. Further, securities were allotted on 6^th June 2024. Also, the company has completed the process for right issue by obtaining listing approval on 13^th June 2024 and trading approval on 18^th June 2024 as on the date of report.

Further, company has passed a Special Resolution for issuance of upto 5,00,00,000 convertible warrants of Rs. 9/- each to promoters and non-promoters on preferential basis and made an application to NSE for its in principle approval. But, company has received the communication from investors that they want to withdraw the offer of Preferential warrants of our company due to current low market rates and lack of interest in securities. After due deliberation, the Board of Directors also considered the prevailing market situations and has decided to retract the offer. Therefore, the Board of Directors in its meeting held on Saturday, 19th day of April 2025, has considered and approved the same and withdrawn the In-principle approval application submitted to the NSE.

6. DIVIDEND

The Company has earned a profit of Rs. 3,37,19,234/- during the period under review, but with a view of augmenting financial resources for generating stable growth in future, the Board of Directors of the company have decided to carry forward entire profit and hence do not propose to recommend any dividend for the financial year on equity shares.

7. DEPOSITS

During the year under review, the Company has not accepted any Fixed Deposits from its Members in accordance with the provisions of Sections 73, 76 and other applicable provisions of the Companies Act, 2013 ("the Act") and the Companies (Acceptance of Deposits) Rules, 2014.

8. CHANGES IN SHARE CAPITAL, IF ANY

During the year under review, Company’s authorised share capital has increased from Rs. 40,00,00,000/- (Rupees Forty Crores only) divided into 20,00,00,000 (Twenty crores) equity shares of Rs. 2/- each to Rs. 50,00,00,000/- (Rupees Fifty Crores only) divided into 25,00,00,000 (Twenty-five crores) equity shares of Rs. 2/- each.

During the year under review, Company’s Issued, Subscribed & Paid up Capital has increased from Rs. 17,52,27,442/- (Rupees Seventeen Crore Fifty-Two Lakhs Twenty-Seven Thousand Four Hundred and Forty-Two only) divided into 8,76,13,721 equity shares of Rs. 2 each to Rs. 34,44,87,196/- (Rupees Thirty Four Crore Forty Four Lakhs Eighty even Thousand One Hundred and Ninety Six only) divided into 17,22,43,598 equity shares of Rs. 2 each.

9. FINANCIAL STATEMENTS

The Financial statements have been prepared by the Companys Management in accordance with the requirements of Accounting Standards 21 issued by Institute of Chartered Accountants of India (ICAI) and as per the provisions of Companies Act, 2013.

Pursuant to the provisions of Section 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, as amended, the Annual Return of the Company will be available on the website of the Company and can be accessed through the following link https://ajoonibiotech.com/annualreport.php.

The Board has met 9 (Nine) times during the financial year, the details of which are as under:

27.04.2024, 20.05.2024, 29.05.2024, 09.08.2024, 16.08.2024, 13.11.2024, 03.01.2025, 24.01.2025 and 13.02.2025. The maximum interval between any two meetings didn’t exceed 120 days, as prescribed in the Companies Act, 2013. The details of meetings of the Board and attendance of the directors are provided in the Report on Corporate Governance which forms the part of this report.

As per the applicable provisions of the Companies Act, 2013 & Securities Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015, Four Committees have been constituted in the company which are as follows: -

a) Audit Committee b) Nomination & Remuneration Committee c) Stakeholder Relationship Committee

The details of meetings of the committees and attendance of the members are provided in the Report on Corporate Governance which forms the part of this report.

During the year under review, Mr. Ishtneet Bhatia was appointed an a Director (Independent) on 03^rd January 2025 and was regularized as a Director on 03^rd February 2025. Further, there is no change in directors or Key Managerial Personnel by way of Appointment, re designation, Resignation, Death or dis-qualification.

In accordance with the provisions of Section 152(6) of the Companies Act, 2013 and the Company’s Articles of

Association, Mr. Partek Singh (DIN: 07864006) Director of the Company is liable to retire by rotation at the ensuing AGM, and being eligible, has offered himself for re-appointment.

All Independent Directors have given declarations under section 149(7) that they meet the criteria of Independence as laid down under section 149(6) of the Companies Act, 2013 and Rules made thereunder to be read with Regulation 25 of the SEBI (Listing Obligation & Disclosure Requirement) Regulation, 2015.

The meeting of the Independent Directors was held on 28th March 2025, as per schedule IV of the Companies Act, 2013. All the directors attended the meeting. None of the Directors of your Company is disqualified under Section 162 (2) of the Companies Act, 2013. As required by law, this position is also reflected in the Auditors’ Report.

The details of the remuneration given to the Board of Directors and Key Managerial Personnel have been given in the extract of Annual Return -MGT-9 and copy of the Annual Return is placed on the website of your Company at https://ajoonibiotech.com/annualreport.php.

In accordance with the requirements of the Companies Act and Listing Regulations, your Company has also adopted the Policy on Related Party Transactions and same is available on website of the Company at https://www.ajoonibiotech.com/pdf/RELATED%20PARTY%20TRANSACTION%20POLICY.pdf.

All RPT entered into during the financial year 2024-25 were in the ordinary course of business and were on at arm’s length basis and were placed before the Audit Committee for its approval. In the financial year 2024-25, Details of Related Party as defined under Section 188 of the Act and Regulations 23 the Listing Regulations and their contracts or arrangements with Company are given in Notes to Account of Financial Statements. Form AOC-2 is attached as an "Annexure-A".

Information 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, and subsequent amendments thereto, is annexed to this Board’s Report and marked as Annexure "B".

The provisions of Section 135 of the Companies Act relating to Corporate Social Responsibility are not applicable as the Company is having Net worth less than rupees Five Hundred Crore, Turnover less than rupees One Thousand Crore and Net Profit less than rupees Five Crore.

Pursuant to the provisions of the Companies Act, 2013 and regulation 17(10) of SEBI (LODR) Regulation 2015, a structured procedure was adopted after taking into consideration of the various aspects of the Board’s functioning composition of the Board and its committees, execution and performance of specific duties, obligations and governance.

The performance evaluation of the independent Directors was completed in time. The performance evaluation of the Chairman and the Non-independent Directors was carried out by the Independent Directors. The Board of Directors expresses their satisfaction with the evaluation process.

The performance of each committee has been evaluated by its members and found to be highly satisfactory. On the basis of this exercise, the Board has decided that all Independent Directors should continue to be on the Board.

As per Reg. 34 of SEBI Regulation, 2015 to be read with Part A of Schedule V of the said regulations, a separate section on corporate governance practices followed by the company, together with the certificate from the Statutory Auditor of the company, confirming compliance forms an integral part of this Report.

Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section of this Annual Report as "Annexure-C".

The Company has no subsidiary/Joint ventures/Associate Companies as per the provisions of Companies Act, 2013 during the financial year ended on 31st March, 2025.

Keeping in view of the above applicability, the Company has followed the Indian Accounting Standards notified under Section 133 of Companies Act, 2013 read with Companies (Indian Accounting Standards (Ind AS) Rules, 2015 for preparation of its financial statements for the year ended 31st March 2025.

Pursuant to the requirement under Section 134 (5) of the Companies Act, 2013, with respect to Directors Responsibilities Statement, it is hereby confirmed:

a) That in the preparation of the annual accounts for the financial year ended 31^st March, 2025 the applicable Accounting standards had been followed along with proper explanation relating to material departures; b) That the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that were 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 the year review; c) That the Directors had 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 had prepared the accounts for the financial year ended 31st March, 2025 on a going concern basis; and 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 operating effectively; f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AND OUTGO

The Provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 regarding Conservation of Energy and Technology Absorption do not apply to your company for the period under review. Further, there were no foreign exchange earnings or outgo during the year under review. However, the management has taken all the necessary steps to conserve the resources to the extent possible. "Annexure D".

As required under section 204 (1) of the Companies Act, 2013 and Rules made there under the Company has appointed M/s. S.D.K & Associates, Company Secretaries, Punjab as Secretarial Auditor to conduct the Secretarial Audit of the Company for the financial Year 2024-25. The Secretarial Audit Report for the financial year ended 31st March 2025 is attached as "Annexure E" to this Report.

The Secretarial Auditors’ Report for the fiscal 2025 states that during the period under review the company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, Listing Agreements etc. mentioned above subject to the following observations:

In response to the recent review concerning our regulatory compliance framework, we would like to provide the following information outlining our governance structure, compliance controls, and risk management processes in place.

Management Reply- In light of recent events, we have conducted a thorough review of our compliance procedures and controls. We acknowledge that there were areas where our oversight could have been stronger. Moving forward, we are committed to strengthening our compliance framework. We are implementing new measures to enhance our due diligence and ensure that all future operations are conducted with the utmost adherence to regulatory standards. This includes a more robust internal review process. We are confident that these changes will not only mitigate future risks but also reinforce our commitment to operating with integrity and transparency. We appreciate the continued trust of our stakeholders as we work to uphold the highest standards of corporate governance. and ongoing training for all relevant personnel.

Further, pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations,2024 dated 12 December 2024, the Board of Directors have approved and recommended the appointment of M/s. SDK & Associates, Peer Reviewed Practicing Company Secretaries (PRC Number-7065/2025) as the Secretarial Auditors of the Company for a term of five consecutive financial years commencing from FY 2025-26 to FY 2029-30. The resolution seeking approval of shareholders for the same is set out in the Notice calling the 15^th Annual General Meeting of the Company.

They have confirmed to hold a valid Peer Review certificate as required under the Listing Regulations.

M/s. SDK & Associates have consented to the said appointment and confirmed that their appointment, if made, would be within the limits specified in the Act & Rules made thereunder and SEBI (LODR) Regulations, 2015 and as given in SEBI Circular No.: SEBI/ HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated 31 December 2024. They have further confirmed that they are not disqualified to be appointed as Secretarial Auditors in terms of disqualifications in terms of provisions of the Act & Rules made thereunder and SEBI (LODR) Regulations, 2015and as mentioned in SEBI Circular No.: SEBI/ HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated 31 December 2024.

The provisions of Regulation 24A of the SEBI (LODR) Regulations, 2015 are applicable on the company for the financial Year 2024-25. The company has obtained the compliance report from M/s. S.D.K & Associates, Company Secretaries, Punjab. The Secretarial Compliance Report for the financial year ended 31st March 2025 is attached as "Annexure F" to this Report.

The Secretarial Compliance Report for the year 2025 states the following same observations as stated above in point 26. Following a detailed review, we have identified areas for improvement in our compliance processes. We are now implementing stronger safeguards and stricter oversight to ensure all future activities are conducted with the utmost care. This commitment to enhanced due diligence is a core part of our strategy and reflects our dedication to responsible and transparent business practices.

M/s Narinder Kumar and Company (Firm Registration No. 0030737N), Chartered Accountants (Peer Review Certificate No. 016014) were appointed as Statutory Auditors of the Company at the 14^th Annual General Meeting held on 17^th September 2024, for the term of five consecutive years i.e. for a period of five years commencing from the conclusion of 14^th Annual General Meeting till the conclusion of the 19^th Annual General Meeting of the Company to be held in the year 2029 and shall continue to be statutory auditors of the company for the Financial Year 2025-2026. As required under section 139 of the Companies Act, 2013, M/s Narinder Kumar and Company (Firm Registration No. 0030737N), Chartered Accountants (Peer Review Certificate No. 016014) have confirmed that they are not disqualified from being appointed as Auditors of the Company and is in compliance of Section 139 and 141 of the Companies Act, 2013 and Companies (Audit and Auditors) Rules, 2014 and also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. During the year under review, the Auditors had not reported any matter under Section 143 (12) of the Companies Act, 2013. The Report given by the Auditors on the financial statement of the Company is part of this Report as Annexure "G".

During the year under review, the Statutory Auditors and Secretarial Auditor have not reported any instances of frauds committed by the Company, by its officer or employees to the Audit Committee under Section 143(12) of the Act, including rules made there under (if any) details of which needs to be mentioned in this Report.

In conformity with the provisions of Clause 34(2) of SEBI (LODR) Regulations, 2015, the Cash Flow Statement for the year ended on 31st March, 2025 forms an integral part of the Financial Statements.

The Provisions of Section 134(3) (n) of the Companies Act, 2013 read with provisions of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 regarding implementation of a risk management policy and constitution of Risk Management committee do not apply to your company for the period under review.

However, Your Company follows a comprehensive system of Risk Management. It ensures that all the risks are timely defined and mitigated including identification of elements of risk which might threaten the existence of the Company.

Your Board has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management Personnel of the Company. This policy also lays down criteria for selection and appointment of Board Members. The detail of this policy is explained in the Report on Corporate Governance. The Nomination and remuneration Policy is available on the website of the company at www.ajoonibiotech.com and direct web link to the policy is at https://www.ajoonibiotech.com/pdf/nomination-and-remuneration-policy.pdf.

Details of loans, guarantees and investments under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, as on 31st March, 2025, are set out in Notes to the financial statements of the Company.

Total borrowings of the company both long term and short term as on 31st March, 2025 are amounting Rs.193.96 lacs as compared to previous year ended 31st March, 2024 of amounting Rs. 216.77 lacs (For details Refer Note No. 12 and 14 of the Audited Financial Statements).

Section 177(9) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, inter alia, provides for a mandatory requirement for all listed companies to establish a mechanism called the Whistle Blower Policy for Directors and employees to report concerns of unethical behavior, actual or suspected, fraud or violation or the Companys code of conduct or ethics policy. In line with this requirement, the Company has framed a "Whistle Blower Policy", which is placed on the Companys website. The Whistle Blower Policy as approved by the Board is uploaded on the Company’s website at https://www.ajoonibiotech.com/ and direct web link to the policy is at https://www.ajoonibiotech.com/pdf/whistle_blower_policy.pdf.

Pursuant to the provisions of Regulation 25(7) of Listing Regulations, 2015, the Board has framed a policy to familiarize Independent Directors about the Company. The direct web link to the policy is at https://www.ajoonibiotech.com/pdf/familiarisation_programme.pdf.

The equity shares of the Company are listed on the National Stock Exchange. The listing fee for the year 2025-26 has already been paid.

The Board wishes to place on record its appreciation for the support and co-operation that the Company received from its suppliers, distributors, retailers and other associates. The Company has always looked upon them as partners in its progress and has happily shared with them rewards of growth. It will be Company’s endeavor to build and nurture strong links based on mutuality, respect and co-operation with each other and consistent with customer interest.

As required under section 138 of the Companies Act, 2013 read with Rule 13 of the Companies (Accounts) Rules, 2014 made there under, the Company has appointed Internal Auditors to assess the risk management and to ensure that risk management processes are efficient, effective, secure and compliant. It is the basic check of internal control of the organization. An internal audit is an organizational move to check, ensure, monitor and analyze its own business operations in order to determine how well it conforms to a set of specific criteria.

Your Company’s internal financial control ensures that all assets of the Company are properly safeguarded and protected, proper prevention and detection of frauds and errors and all transactions are authorized, recorded and reported appropriately. Your Company has an adequate system of internal financial controls commensurate with its size and scale of operations, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Company’s policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

The maintenance of cost records for the services rendered by the company is not required pursuant to Section 148(1) of the Companies Act, 2013 read with rule 3 of Companies (Cost Records and Audit) Rules, 2014.

The Company has connectivity with NSDL & CDSL for dematerialization of its equity shares. The ISIN No. INE820Y01021 has been allotted for the Company. Further the Company does not have any Equity shares lying in the Suspense Account.

The relationship with employees continues to be harmonious. The company always considers its human resource as its most valuable asset. Imparting adequate and specialized training to its employees is ongoing exercise in the company.

Since there was no unpaid/unclaimed Dividend declared or paid by the Company, the provisions of Section 125 of the Companies Act, 2013 do not apply.

45. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

During the year under review, the Company has duly complied with the applicable provisions of the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by The Institute of Company Secretaries of India (ICSI).

There were no significant and material orders passed by the Regulators, Courts or Tribunals, during the year under review, which would impact the going concern status of the Company and its operations in future.

The disclosure under the provisions of Section 67(3) read with Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 in respect of voting rights not exercised directly by the employees in respect of shares to which scheme for provision of money for purchase of or subscription for shares by employees or by trustees for the benefit of employees is not applicable to the company.

The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders under the SEBI (Prohibition of Insider Trading) Regulations, 2015. This Code requires pre-clearance for dealing in the company’s shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

There are no proceedings initiated/ pending against your company under the Insolvency and Bankruptcy Code, 2016.

During the period under review, there was no one-time settlement with any Bank or Financial Institution. Hence, no valuation was required to be undertaken.

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment ("POSH" policy) at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal Act, 2013 and the Rules made there under to provide a safe and harassment free workplace for every individual working in any office of the Company. The Company has duly set up an Internal Complaints Committee ("ICC") in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, to redress complaints received regarding sexual harassment. The Company did not receive any complaint of sexual harassment during the year under review.

The Company has complied with the applicable provisions of the Maternity Benefit Act, 1961. It has ensured that all eligible female employees are extended the benefits mandated under the Act, including paid maternity leave, nursing breaks, and protection from dismissal during maternity leave.

During Financial Year 2024-25 no Maternity Benefit is provided by the Company. The Company remains committed to providing a safe, supportive, and inclusive work environment and continues to implement policies that support the health and well-being of women employees, especially during maternity and post-maternity periods.

Your Directors would like to express their appreciation for assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company and the shareholders for their support and confidence reposed on the Company.