Arex Industries Ltd Directors Report

Dear Members,

Your Directors are pleased to present this Thirty Seventh Annual Report together with the Audited Statement of Accounts of the Company tor the year
ended on 31^s* March, 2026.

FINANCIAL RESULTS

As per the notification issued by the Ministry of Corporate Affairs dated 16" February, 2015 relating to the Companies (Indian Accounting Standards) Rules,
2015, the Company has adopted "Ind AS with effect from 1^st April, 2017. Accordingly, the Financial Statement for the year 2025-26 has been prepared in
compliance with the Companies (Indian Accounting Standard) Rules, 2015.

Financial Performance	(Amount in Rupees in Lakhs)
	31.03.2026	31.03.2025
Revenue from operations	4963.74	5114.11
Profit before Depredation & Finance Cost	731.38	889.15
Less: Finance Cost	103 76	109 40
Depreciation & Amortisation Expenses	435.74	413.13
Profit before Tax	191 88	366.62
Tax Expenses- Current Taxation	94.08	120.25
Deferred Tax	(50.35)	(17.04)
Add/(Less). (ExcessyShort Provision of tax of earlier years Profit/(Loss) for the year	148.15	263.41
Other comprehensive Income Items that will not be reclassified to profit or loss	(14.54)	0.00
Gain/(Loss) on measurement of Equity Share instruments at fair value	0.00	0.00
Income tax impad on above	3.66	0.00
Other comprehensive Income for the year	(10.88)	0.00
Total comprehensive lncome/(Loss) for the year	137.27	263.41

OPERATIONS

The revenue from operations (net) stood at Rs.4963.74 lakhs, i.e. an decrease of 2.94% over the previous years revenue. The Company continued to
explore overseas market opportunities and has been able to achieve exports amounting to Rs. 296.71 lakhs, i.e. increase of 311.18% over the previous
years exports. There was heavy fluctuation in foreign exchange rates resulting into net gain of Rs.4.71 lakhs. The bad debts amounting to Rs. 1.40 lacs
were written off during the year as against bad debts of Rs. 1.54 written off during the previous year. The raw material prices, fuel charges, finance cost and
other overheads were continued to increase during the year.

The Company has made a profit of Rs. 137.27 lakhs as against profit of Rs 263.41 lakhs made after taxes during the previous year. Your Directors continue
to explore further growth opportunities.

DIVIDEND

The Board of Directors have recommended a dividend of Rs. 2.50/- (Rupees Two and Fifty Paise Only) per equity share of Rs. 10/- (Rupees Ten Only)
each, aggregating to Rs. 89.97 lacs for the financial year ended on 31^st March, 2026. The Company has not declared any dividend in the previous financial
year. Dividend is subject to approval of members at the ensuing Annual General Meeting (AGM) and shall be subject to deduction of income tax at source.
Your Directors do not propose any amount to carry to the general reserves.

FINANCE

Your Company continued to avail financial assistance from its Bankers to finance its present and/or proposed projects on hand.

PUBLIC DEPOSITS

The Company has not accepted any deposit within the meaning of the provisions of Section 2(31) and 73 to 76 of the Companies Ad, 2013, read with the
Companies (Acceptance of Deposits) Rules, 2014.

INSURANCE

All the assets of the Company including buildings, plant and machineries and stocks are adequately insured.

DIRECTORS/REAPPOINTMENT OF KMPs

(1) Shri Pragnesh K Shah (DIN 00228223), Diredor and (2) Shri Laxman C Tilani (DIN 00532516), Diredors of the Company are due to retire by rotation
at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointments. The Board hereby re-commends their re-appointments.

Tenure of Shri Dinesh Apparao Bilgi (DIN 00096099), Managing Director cum Chief Financial Officer of the Company, Shri Neel Dinesh Bilgi (DIN 00096180)
and Shri Chirag Dinesh Bilgi (DIN 02094970) was set to expire on 31st July, 2026. The Nomination & Remuneration Committee and the Board of Diredors,
in their meetings held on 13th August, 2025 and the members at the Annual General Meeting held on 29" September, 2025 approved their re-appointments
for a period from 1" August, 2026 to 31" July, 2029.

The term of Shri Aviv J Divekar (DIN 00689884) as an Independent Diredor is set to expire on 31" August, 2026. Being eligible the Nomination &
Remuneration Committee and the Board of Directors in their meetings held on 29* July, 2026, subjed to approval of the members at the ensuing Annual
General Meeting have re-appointed Shri Aviv J Divekar (DIN 00689884) as Non-Executive Independent Diredor of the Company for his second and final
term of five years starting from 1" September, 2026 to 31" August, 2031. The Board hereby re-commends his re-appointment.

BOARD AND COMMITTEE MEETINGS

During the year under review, four meetings of the Board were held. The details of the Board and Committee meetings are provided in the Corporate
Governance Report forming part of this report.

The details of Audit Committee and the Stakeholders Grievance Committee are provided in the Corporate Governance Report forming part of this report.
NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee of the Company review the composition of the Board, to ensure that there is an approximate mix of abilities,
expertise, experience and diversity to serve the interest of the shareholders of the Company. The Policy ensures that (1) the level and composition of
remuneration is reasonable and sufficient to attrad, retain and motivate diredors of the quality required to run the Company, (2) relationship of remuneration
to performance is clear and meets appropriate performance benchmarks and (3) remuneration to diredors, key managerial personnel and senior
management involves a balance between fixed and incentive pay refleding short and long term performance objedives appropriate to the working of the
company.

INDEPENDENT DIRECTORS

As per the provisions of Section 149 of the Companies Ad, 2013, the Independent Diredors have confirmed and declared that they are not disqualified to
act as independent directors and the Board is also of the opinion that the Independent Diredors fulfill all the conditions specified in the Companies Act,
2013 making them eligible to ad as Independent Diredors.

One separate meeting of the Independent Diredors was held on 05.01.2026. The Independent Diredors adively participated and provided guidance to the
Company. The Independent Diredors reviewed the performance of the non-independent Diredors and the Board as a whole.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which thefinancial
statements relate and the date of this Report.

SHARE CAPITAL OF THE COMPANY

There is no change in the share capital of the Company for the year under review.

BOARD EVALUATION

Pursuant to the provisions of Sedion 134 of the Companies Act, 2013, a structured questionnaire was prepared after taking into account various aspects
like- company performance, contribution of individual diredors, composition of Board and committees, performance of duties, culture, obligations, corporate
ethics, risk management etc. for evaluation process. The Board noted that all diredors have understood the opportunities and risks to the Companys
strategy with good balance between the core values of the Company and the interest of the stakeholders. The Board also evaluated performance of the
various committees and concluded with satisfadion. The Board expressed their satisfaction forthe above evaluation process.

PARTICULARS OF EMPLOYEES

There was no employee covered under the purview of Sedion 134(3)(q) of the Companies Ad, 2013 read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.

Information required under the provisions of Sedion 197(12) of the Companies Ad, 2013 read with the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is given by way of an Annexure E to this Report.

CHANGES IN NATURE OF BUSINESS

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

However, the Board of Diredors, in their meeting held on 13th August, 2025 and the members in the Annual General Meeting held on 29" September,
2025, have approved to amend the Main Objeds Clause of the Memorandum of Association of the Company by adding clause no. 8 after clause no. 7 as
follows:

Addition of the following sub-clause after clause (7):

8. To carry on business as manufadurers, printers, processors, inventors, convertors, importers, exporters, traders, buyers, sellers, retailers, wholesalers,
suppliers, indenters, packers, movers, preservers, stockists, agents, merchants, distributors, consignors, jobbers, brokers, concessionaires or otherwise
deal in aluminium foils coating, lamination and printing, card board packing, plastic packing, polythene packing, gunny bags, paper tags, containers, bottles,
hollow wares, whether made of leather, plastics, H.D.P., L.D.P., polypropylene, P.V.C. and manmade fibrous materials and all kinds of varieties of packaging
materials in India or elsewhere in the world.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirements of Sedion 134(3)(c) of the Companies Act, 2013, the Directors hereby state that:

(i) in the preparation of annual accounts for thefinancial year ended 31^s* March, 2026, the applicable accounting standards have been followed along with
proper explanation relating to material departures;

(ii) the directors have seleded 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 31^st March, 2026 and of the profits of the Company for the year ended on
that date;

(iii) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies
Ad, 2013 for safeguarding the assets of the Company and for preventing and deteding fraud and other irregularities;

(iv) the diredors have prepared the annual accounts on a going concern basis.

(v) the diredors had laid down internal controls to be followed and such internal controls are adequate and were operating effectively.

(vi) the diredors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and
operating effedively.

ORDERS BY REGULATORS, COURTS OR TRIBUNALS

No significant and/or material orders were passed by any Regulator, Court or Tribunal impacting the going concern status and the Companys operations
in futire. The Company has received notice for demand and interest from the GST Authorities during the year under review. The Company has filed appeal
against such notice for demand and interest. The demand shall not have any significant and/or material effed on the Company.

COMPANYS POLICIES
Code of Condud

All Directors, Key Managerial Personnel and Senior Management of the Company have confirmed compliance with the code of condud applicable to the
Diredors and employees of the Company. The Code of Conduct is available on the website of the Company at
https://www.arex.co.in/investors/Policies/Code%20of%20Condud%20for%20Diredors%20and%20Senior%20Management.pdf. The Diredors have
confirmed compliance with the provisions of Sedion 164 of the Companies Act, 2013 except from Mr. Laxman Chetandas Tilani for FY 2026-27.

Risk Management Policy

The Company has already formulated risk management policy so as to identify, evaluate, monitor and minimize identifiable business risks in the organization.
Vigil Mechanism/Whistle Blower Policy

The Company has already adopted Whistle Blower Policy to report genuine concerns or grievances and to safeguard vidimization of persons while using
this mechanization. The Whistle Blower Policy is available on the website of the Company at
https://www.arex.co.in/investors/Policies/Whistle%20Blower%20Policy.pdf.

Other Policies

Companys Policies on Remuneration (Available on the website of the Company at
https://www.arex.co.in/investors/Policies/Nomination%20&%20Remuneration%20Policy.pdf, Materiality of Related Party Transadions (Available on the
website of the Company at https://www.arex.co.in/investors/Policies/Related%20Party%20Transaction%20Policy.pdf, Board diversity, Preservation of
documents, Corporate Social Responsibility (CSR) are finalized in accordance with applicable laws.

DONATION

The Company has voluntarily donated Rs. 3 lacs to Sri Hombuja Padmavathi Education Trust, Rs. 12 lacs to Gunayatan Trust, Rs. 0.25 lacs toHarekrishna
Movement, Ahmedabad, Rs. 0.05 lacs to Kamladevi Jeetmal Charitable Trust, Ahmedabad, Rs. 0.21 lacs to Gayatri Parivar Trust, Kalol, for charitable
activities during the year.

INTERNAL FINANCIAL CONTROLS

The Company has a proper, adequate and effective internal control system to ensure that all the assets are safeguarded and protected against loss from
unauthorized use or disposition and those transactions are authorized, recorded and reported correctly.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

The Company has been taking steps for optimum utilisation of power and fuel. The information as required under Section 134(3)(m) of the Companies Act,
2013 read with the Companies (Accounts) Rules, 2014, is given by way of Annexure A forming part of this Report.

ANNUAL RETURN

As required under the amended provisions of Section 92(3) of the Companies Act, 2013, copy of Annual Return is available at www.arex.in.

CEO/CFO CERTIFICATION

Shri Dinesh A Bilgi (DIN:00096099), Managing Director and CFO has given necessary certificates/compliance reports to the Company.

SECRETARIAL AUDIT

As required under the provisions of Section 204 of the Companies Ad, 2013 and the Rules made thereunder, a Secretarial Audit Report is given byway of
an Annexure B, forming part of this Report. The Auditors observations are self-explanatory. The Secretarial Auditor has confirmed that he is not disqualified
from continuing as the Secretarial Auditor of the Company.

The Secretarial Auditor in its report attached to this Diredors Report has noted that the Diredors Declarations from all the Diredots have been received
except from Mr. Laxman ChetandasTilani. The Company in reply to such noting wishes to clarify that the Company has made efforts to receive the necessary
Diredors Declarations from Mr. Laxman Chetandas Tilani, but no response has been received till date to the communications made relating to the Diredor
Delcaration.

STATUTORY AUDITORS

M/s Sweta Patel & Associates, Chartered Accountants of Ahmedabad having Firm Registration No. 139165W have been reappointed as Statutory Auditors
of the Company for a period of five years by the members of the Company in their 33^rd Annual General Meeting (AGM) held on 21^s* September, 2022. The
said Auditors have submitted certificate to the effed that they are eligible for continuing such appointment and are not disqualified to act as such.

The Auditors observations read with the notes to the Accounts for the year ended on 31^st March, 2026 are self-explanatory.

MANAGEMENT DISCUSSION AND ANALYSIS (MD&A) & CORPORATE GOVERNANCE

The Companys philosophy is based on trusteeship, transparency and accountability. It fosters a culture of ethical behaviour and disclosures which build a
trust of our stakeholders. The Code of Condud, ethics and Code of Condud for Prevention of Insider T rading are an extension of our values and refled our
commitment to ethical business pradices, integrity, and compliances of both voluntary and statutory requirements. A detailed note on Management
Discussion and Analysis is given as an Annexure C to this Report.

CORPORATE GOVERNANCE REPORT

As per Regulation 34(3) read with Schedule V of the Listing Regulations, a separate section with detailed note on corporate governance practices followed
by the Company is given by way of an Annexure D forms an integral part of this Report.

LISTING WITH BSE LTD

The Equity Shares of the Company are listed at the BSE Ltd, Mumbai under Stock Code No. 526851 and ISIN No. is INE480H01011.

The Company has paid Annual Listing fees for the year 2026-27. The Company has also paid custodial charges to National Securities Depository Ltd and
Central Depository Services (India) Ltd for the year 2026-27

REGISTRAR AND SHARE TRANSFER AGENT (RTA)

M/s MUFG INTIME INDIA PRIVATE LIMITED (Formerly known as M/s. Link Intime India Private Limited), Mumbai is the RTA of the Company to carryout
the share transfers, transmission, dividend and other related activities.

RELATED PARTY TRANSACTIONS

All the transactions entered with related party during the year under review were on arms length basis and in the ordinary course of business and approved
by the Audit Committee. Hence these transactions are outside the purview of the provisions of Section 188 of the Companies Ad, 2013. However, details
of such transadions i.e. purchases, lease, services, etc., are given Form AOC-2 at Annexure - A1.

COST RECORDS:

The Company is not required to maintain cost records as per the provisions of the Companies Act, 2013 and the relevant rules made thereunder.

LOANS, GUARANTEES AND INVESTMENT

The Company has not granted any inter-corporate loan, given guarantee or provided any security for availing loan by other Company nor made any
investments during the financial year under review.

ENVIRONMENT AND SAFETY

The Company considers clean and safe mode of operations in all respeds. Further, as required under the provisions of Sexual Harassment (Prevention,
Prohibition and Redressal) Ad, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at workplace. There is
no such complaint lodged during the year.

PROCEEDINGS UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016, IF ANY

No proceedings were initiated against the Company during the year under review under the Insolvency and Bankruptcy Code, 2016.

PROVISIONS RELATING TO THE MATERNITY BENEFIT ACT, 1961

The Company has complied with the requisite provisions relating to the Maternity Benefit Act, 1961, to the extent applicable to the Company.
ACKNOWLEDGEMENTS

The Board of Diredors of the Company appreciates continuous & comprehensive support and cooperation by the Companys bankers, shareholders,
customers, suppliers and other business associates.

Your Directors place on record their deep appreciation for contribution and devoted services of the employees at all levels.