Avana Electrosystems Ltd Directors Report

<dhhead-DIRECTORS REPORT</dhhead-

To,

The Members,

Avana Electrosystems Limited

Your Directors have pleasure in submitting their 15^thAnnual Report and Audited Accounts for the year ended on March 31, 2025.

1. Disclosure of financial summary or highlights

Particulars	Financial Year ended
	March 31,2025	March 31,2024
Revenue from Operation	6,148.58	5,298.77
Other Income	144.81	26.80
Total Income	6,293.39	5,325.57
Operating expenditure	4,987.87	4,702.93
Profit (Loss) Before Tax and Depreciation	1,305.51	622.64
Depreciation	75.63	35.00
Profit (Loss) Before Tax	1229.88	587.64
Current Tax	325.70	163.95
Current tax expense relating to prior years	(0.82)
Deferred Tax	(2.24)	19.67
Net Profit(Loss) After Tax	847.08	404.02
Basic and diluted earnings (Amount in actual) r	4.85	2.31

Revenue from operations during the year under review is Rs.6,148.58/- (In lakhs] compared to previous years revenue of Rs.5,298.77/- (In lakhs). Profit after tax is Rs.847.08/- (In Lakhs) when compared to last year profit of Rs.404.02/- (In Lakhs).

2. State of Affairs

The Company is engaged in the business of manufacturing and dealers in various types of electronic products, switchgear products, circuit breakers, relay, control and protection panels, electric distribution boards, electronic meters, transformers, raw materials, assemblies, spares, accessories, consumables, disposables, tools, test equipments, measuring equipments, telecommunication products, satellite products, information technology products, substation, automation products, SCADA, energy saving equipments, battery charges, current transformers, power transformers, etc.

There has been no change in the nature of business of the Company during the financial year ended March 31,2025.

Shareholders in their meeting held on 9^th December, 2024 resolved to convert the Private Company into Public Company by filing INC-27 form. The Registrar of Companies issued a fresh Certificate of Incorporation on 17^th December, 2024.

3. Change in Capital Structure

During the year, the Authorised Share Capital of the Company was increased from Rs. 90,00,000 /- divided into 9,00,000 Equity Shares of Rs.10/- each to Rs.25,00,00,000/- divided into 2,50,00,000 Equity Shares oR10/- each. However, no fresh issue of shares was made during the year under review.

4. Amounts Transferred to Reserves

The Board of the company has not transferred any amountto its reserves:

(a) Brief description	NIL
(b) Amount (in INR)	NIL

5. Dividend

With the view to conserve the resources of company the directors are not recommending any dividend.

(a) Brief description	NIL
(b) Amount (in INR)	NIL

6. Details of material changes and commitment occurred during the period between the end of FY and the date of report, affecting financial position of company

The following material changes and commitments have occurred between the end of the financial year to which the financial statements relate and the date of this report:

1. 16,67,53,444 Bonus shares are allotted to existing shareholders at a ratio of 1:21 by Capitalizing Reserves and Surplus of the Company.

2. The Company has planned to take the approval of the shareholders to seek In-principal approval of stock exchange for listing of its equity shares at National Stock Exchange as Small and Medium Enterprises.

3. The Board of Directors in their meeting held on 2^ndSeptember, 2025 resolved to updateits registered office address at the Ministry of Corporate Affairs website to No. 8, Plot No.35, 1st Main Road, 2nd Phase Peenya Industrial Area, Nelagadaranahalli Village, Peenya Small Industries, Bangalore, Bangalore North, Karnataka, India, 560058.

7. Web address

As provided under Section 134(3)(a) and 92(3) of the Companies Act 2013, the annual return will beplaced on the Companys website at https://avanaelectrosvstems.com/

8. Management

The Composition of the Board is duly constituted.

The Company has a professional Board with a optimum combination of Executive& Non- Executive Directors who bring the right mix of knowledge, skills, and expertise and help the Company in implementing the best Corporate Governance practices.

In the meeting of Board of Directors held on 11^th November, 2024, Mr. Panish Anantharamaiah having DIN: 00288112was re-designated as Managing Director of the Company, at the same meeting Mr. Gururaj Dambal, having DIN: 0309940 was re-designated as Whole-time Director, and Mr. Vinod Kumar Sampatkumar having DIN: 03115822 was re-designated as Whole-time Directorfor a period of 5 years andon 11^th November, 2024.

• Mrs. Rajesh Dakshayani was appointed as Independent women director at the Shareholders meeting held on 11^th January, 2024. However due to personal pre-occupations, Mrs. Rajesh Dakshayani submitted her resignation on 23^rd July, 2025, with effect from closing of business hours of 1^st August, 2025.

The following changes occurred in the composition of Board of Directors after 31^st March, 2025 till the date of this report:

Mr. Nama Sreeramaiah Kishore having DIN: 11222235, Mrs. Sheela Arvind having DIN: 01020390 and Mrs. Shital Darak Mandhana having DIN: 07043909 were appointed as Independent Directors of the Company for a period of 5 years from 4^th August, 2025.

Board of Directors in their meeting held on 29^th August, 2025, approved formation of the following Board committees with members as detailed below:

AUDIT COMMITTEE

Name of the Director	Status in the Committee	Nature of Directorship
Kishore N S	Chairman	Independent Director
Sheela Arvind	Member	Independent Director
Kondahalli Nagaraj Sreenath	Member	Executive Director

NOMINATION AND REMUNERATION COMMITTEE

Name of the Director	Status in the Committee	Nature of Directorship
Sheela Arvind	Chairperson	Independent Director
Shital D Mandhana	Member	Independent Director
Kishore N S	Member	Independent Director

STAKEHOLDERS RELATIONSHIP COMMITTEE

Name of the Director	Status in the Committee	Nature of Directorship
Shital D Mandhana	Chairman	Independent Director
Sheela Arvind	Member	Independent Director
Panish Anantharamaiah	Member	Executive Director

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

Name of the Director	Status in the Committee	Nature of Directorship
Kishore N S	Chairman	Independent Director
Gururaj Dambal	Member	Executive Director
Vinod Kumar Sampat Kumar	Member	Executive Director

Apart from the above there is no change in the composition of Board of Directors, as on 31^st March, 2025, the Board of Directors consists of the following individuals:

Sl.no Name of Director	Designation
Panish Anantharamaiah 1.	Managing Director
Gururaj Dambal	Whole-time director
Vinod Kumar Sampatkumar	Whole-time director
Konda-halii Nagaraj Sreenath 4.	Director& CFO
Rajesh Dakshayani	Independent Director

Mr. Kondahalli Nagaraj Sreenath was designated as the Chief Financial Officerthrough Board resolution dated 11^th November, 2025 owing to his rich experience in the handling

finance in the Electrical Industry, However due to personal problems, he rendered resignation as the CFO with effect from 29^thAugust, 2025.

Mr. Ravikumar S, a qualified Chartered Accountant with over 9 years of experience in audit, accounting and taxation, having worked with reputed organizations, was appointed as the Chief Financial Officer of the Company with effect from 1st September, 2025.

Mrs. Amrutha Naveen, University Topper in Master of Science and Gold Medalist in Nuclear Chemistry from Andhra University, and a qualified Company Secretary since 2019, having served with various firms as Compliance Manager and Company Secretary, was appointed as the Company Secretary and Compliance Officer of the Company with effect from 29th August, 2025.

9. Number of meetings of the Board

The Board meets at regular intervals to discuss and decide various business strategies and routine operations. The Board of Directors met 8 times during the year 2024-25. The intervening gap between the meetings was within the period of 120 days prescribed under the Companies Act, 2013.

(i) *Number of Board Meetings held: 08

			Attendance
SI. No.	Date of meeting (DD/MM/YYYY)	Total Number of directors as on the date of meeting	Number of directors attended	%of attendance
1	24/04/2024	04	04	100%
2	5/6/2024	04	04	100%
3	19/08/2024	04	04	100%
4	18/10/2024	04	04	100%
5	11/11/2024	04	04	100%
6	5/12/2024	05	05	100%
7	29/03/2025	05	05	100%
8	31/03/2025	05	05	100%

(ii) Number of Committee Meetings held: NA

			Attendance
SI. No.	Date of meeting (DD/MM/YYYY)	Total Number of directors as on the date of meeting	Number of directors attended	%of attendance
1

10. Declaration by Independent Directors

The Company has received declarations fromthe Independent Directors confirming that they meet with the criteria of independence as prescribed under Section 149(6) of the Act.

There has been no change in the circumstances affecting their status as Independent Directors of the Company and in the opinion of the Board, the Independent Directors fulfil the conditions specified under the Act and the Listing Regulations and are Independent of the management.

11. Disclosure for Companies covered under section 178(1) on Directors appointment and remuneration including other matters provided under section 178(3)

As on 31^st March, 2025, theCompany need not form a Nomination and Remuneration committee and Stake holders relationship committee in accordance with section 178 (1) and 178(5) of the Companies Act, read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014, accordingly disclosures under section 178(1) on Directors appointment and remuneration including other matters provided under section 178(3) are not applicable.

12. 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 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 as at March 31, 2025 and of the profit of

j 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 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 annual accounts on a going concern basis;

e) The Company being a Private Limited Company, Internal financial control policies are not applicable. However, the Company is having adequate controls.

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.

13. Auditors

At the Annual General Meeting held on 30^th September, 2024M/S. Vasanth& Co., Chartered Accountants, a peer reviewed auditor firm (Firm Registration NO.008204S) were

appointed as Statutory Auditors of the Company to hold office till the conclusion of Annual General Meeting to be held in the financial year 2028-2029.Auditors confirm that they do not suffer from any disqualification to act as statutory auditors of the Company.

14. Reply to Auditors remarks, if any

The observation made in the Auditors Report are self-explanatory and, therefore, do not call for any further explanations under Section 134 of the Companies Act, 2013.

SI. Auditors qualifications, reservations or No. adverse remarks or disclaimer in the auditors report	Directors comments on qualifications, reservations or adverse remarks or disclaimer of the auditors as per Boards report
1. No adverse remarks	Not applicable

15. Secretarial Audit

The Company does not fall under any of the clauses of Sub-rule (1) of Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules,2014 mentioned in section 204 of the Companies Act, 2013, accordingly, the Company is not required to appoint Secretarial Auditors, hence obtaining Secretarial Audit report in form MR-3 not applicable.

16. Fraud Reporting

There is no details required to be furnished in respect of frauds reported by auditors under subsection (12) of section 143 other than those which are reportable to the Central Government.

17. Orders passed by Court / Tribunal

There is no significant and material orders are passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

18. Particulars of Contracts entered into by the Company

During the year under review, the Company has entered to contracts with related parties. The transactions are done at arms length value in the ordinary course of business. Since there is no RPT transaction exceeding limits specified under section 188 of the Companies Act, 2013 read with rule Companies (Meetings of Board and its Powers) Rules,2014, no Board or Shareholders approval was taken.

19. Details of loan, guarantee, investment or security is given by the company as per section 186:

a. Whether any loan, guarantee is given by the company or securities of any other body corporate purchased: No

b. Whether the Company falls in the category provided under section 186(11) - No

c. Are there any reportable transactions on which section 186 applies(whether or not threshold exceeds 60% of its paid-up share capital, free reserves and securities premium account or 100% of its free reserves and securities premium

d. Brief details as to why transaction is not reportable

The Company has not provided any loan or provided guarantee or did investment or given security as per section 186 of the Companies Act, 2013.

Table for enquiring details:

Number of transactions:

~NIL

Block-1
Corporate identity number (CIN) or foreign company registration number (FCRN) or Limited Liability Partnership number (LLP1N) or Foreign Limited Liability Partnership number (FLLP1N) or Permanent Account Number (PAN)/Passport for individuals or registration number	-	-
Name of the Party
Type of person (Individual / Entity)
Nature of transaction
In case of loan, rate of interest would be enquired
Brief on the transaction
Amount (in INR)
Date of passing Board resolution (DD/MM/YYYY)
Whether the threshold of 60% of paid-up sfiare capital, free reserves and securities premium account or 100% of its free reserves and securities premium account breached	Yes/No	Yes/No
Whether the transaction falls under the purview of proviso to Section 186(3) and Company is not required to pass SR	Yes/No	Yes/No
SRN of MGT-14

20. Risk Management Policy

The Company has laid down a well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out to identify, evaluate, manage and monitor the business and non-business risks. The Board periodically reviews the risks and Suggest steps to be taken to manage/ mitigate the same through a properly defined policy framework.

During the year, a risk analysis and assessment was conducted and no major risks were noticed, which may impact on the business objectives of the Company.

21. Disclosure about deposits

The Company has not accepted any deposits within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

(i) Deposits accepted during year
(ii) Deposits remained unpaid or unclaimed at end of year	Not applicable
(iii) Amount of default in repayment of deposits or payment of interest thereon beginning of year	-
(iv) Maximum amount of default in repayment of deposits or payment of interest thereon during year
(v) Amount of default in repayment of deposits or payment of interest thereon end of year
(vi) Number of cases of default in repayment of deposits or payment of interest thereon beginning of year
(vii) Maximum number of cases of default in repayment of deposits or payment of interest thereon during year
(viii) Number of cases of default in repayment of deposits or payment of interest thereon end of year
(ix) Details of deposits which are not in compliance with requirements of Chapter V of Act

22. Compliance of Secretarial Standards

During the year under review, the Company has complied with applicable Secretarial Standards SS-1 and SS-2.

23. Corporate Social Responsibility

The provisions of Corporate Social Responsibility (CSR) became applicable to the Company for the financial year ended 31st March, 2024, pursuant to Section 135 of the Companies Act, 2013, as the net profit of the Company exceeded Rs. 5 Crores. Accordingly, the Company was required to spend an amount of ^4,94,541.19, being 2% of the average net profits of the preceding three financial years computed in accordance with Section 198 of the Act.

However, the Company was unable to implement any CSR projects during the year due to the absence of a well-formulated CSR Policy. In compliance with the second proviso to sub-section (5) of Section 135 of the Companies Act, 2013, the said unspent amount is proposed to be transferred to the Prime Ministers National Relief Fund (PMNRF).

24. Conservation of Energy, Technology Absorption, Foreign Exchange earnings and Outgo

Conservation of Energy

Steps taken or impaction conservation of energy	Adequate measures have been taken to conserve the consumption of energy.
The steps taken by the company for utilizing alternate source of energy	Not applicable
The capital investment on energy conservation equipment	NIL

Technology Absorption

Thee efforts made to wards technology absorption	During the year, your Company made significant addition to the numbers of desktops and servers used for software design and development and other services that the company provides.
The benefits derived like product Improvement, cost reduction, product development or import substitution	Your Company shall strive to adaptor the changing technology to ensure quality delivery of its output.
In case of import ad technology(import enduring the last three years Reckoned from the beginning of financial year)	No Technology import enduring the year
(a) The detail soft technology imported
(b) The year of the import
(c) Whether the technology been fully absorbed
(d) If not fully absorbed area where absorption has not taken place,
And there as on thereof
(e) Thee expenditure on research and development

Foreign Exchange earnings and Outgo

Earning sin Foreigne exchange	2024-25 Rs.
Export	NIL

 

Expenditure in foreign currency	2024-25
	Rs.
Purchase of Raw Material	NIL
Traded goods	NIL
Technical Fees	NIL
Purchase of Fixed Assets	NIL
Travelling Expenses	NIL

25. Subsidiaries, Joint Ventures and Associate Companies

The Company is not having any Subsidiary, Associate Company or Joint Venture. Hence, there is no requirement of preparation of Standalone/Consolidated financial statements.

26. Internal Financial Controls:

The Company has established a comprehensive internal controls framework. This framework encompasses an array of policies, procedures, and mechanisms that are pivotal in augmenting operational efficiency and effectiveness, curtailing risks and expenditures, and fostering enhanced decision-making and accountability.

The internal financial controls framework, an integral component of the broader internal controls system, is pivotal in guaranteeing the dependability and precision of financial reporting. This framework facilitates the meticulous preparation of financial statements by generally accepted accounting standards.

27. Disclosure about Cost records and cost audit

The Company is required to maintain Cost Records as specified by the Central Government under section 148 of the Companies Act, 2013 and the same is applicable on the Company. The Company has maintained proper cost records as required under the act.

Cost audit is not applicable to the Company as the annual turnover of the company from all its products and services during the immediately preceding financial year does not exceed Rs.100 crore or more and the aggregate turnover of the individual product or products or service or services for which cost records are required to be maintained under rule 3 of Companies (Cost Records and Audit) Rules, 2014 does not exceed Rs. 35 crore or more.

28. Corporate Insolvency Resolution Process Initiated by the Company under the Insolvency and Bankruptcy Code, 2016 (IBC)

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

29. Details of Difference between the amount of the Valuation done at the time of One Time Settlement and the Valuation Done while taking loan from the Banks or Financial Institutions Along with the reasons thereof:

The Company has neither availed any loan from banks or financial institution and hence there is no application being ever made for One Time Settlement (OTS) with any banks or financial institution.

30. Annual Evaluation of the Board

During the year, annual performance evaluation of the Board and Committees of the Board, individual Directors including the Chairman of the Board, was carried out as per the criteria and process approved by Nomination and Remuneration Committee, which is in line with the SEB! Guidance Note on Board Evaluation.

The Board discussed upon the performance evaluation outcome and concluded that they were satisfied with the overall performance of the Board and Committees of the Board and Directors individually. The Board also assessed the fulfilment of the independence criteria by the Independent Directors of the Company and their independence from the management as specified in the Listing Regulations.

31. Compliance with Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company strongly believes in providing a safe and harassment free workplace for each and every individual working for the Company through various interventions and practices. It is the continuous endeavour of the Management of the Company to create and provide an environment to all its employees that is free from discrimination and harassment including sexual harassment. The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment 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 thereunder.

A statement that the company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

(a) (i) Number of Sexual Harassment Complaints received	NIL
(ii) Number of Sexual Harassment Complaints disposed off	NIL
(iii) Number of Sexual Harassment Complaints pending beyond 90 days	NIL

Statement that company has complied with Maternity Benefit Act: The Company has complied with the provisions of Maternity Benefit Act, 1961 as there are more than 10 women employee in the Company.

32. Particulars of Employees

The Company being allnlisted Public Company, disclosure under section 197(12) with regard to ratio of remuneration of Directors to median employees remuneration is not applicable.

However, as required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, we wish to inform that, during the year under review, none of the employee is drawing the remuneration in excess of Rs. 8.5 Lakhs per month when employed for part of year or Rs. 1,02,00,000 per annum when employee is employed for entire year.

33. Number of employees as on the closure of financial year

Female	20
Male	109
Transgender	NIL

34. Vigil Mechanism

Provisions of Section 177(9) of the Companies Act 2013 and Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 are not applicable to the Company as the Company does not fall under any of category mentioned in Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2(fl4.

35. One Time Settlement Scheme:

During the year under review, the Company has not availed any one-time settlements offered from Banks.

36. Downstream Investment

The Company neither have any Foreign Direct Investment (FDI) nor invested as any Downstream Investment in any other Company in India.

37. Acknowledgement

Your Directors place on record their sincere appreciation for the continued support, cooperation and guidance received from shareholders, bankers, suppliers, customers and various Government authorities. The Board also records its deep appreciation for the committed and dedicated services rendered by the employees of the Company at all levels.