Clay Craft India Ltd Directors Report

AShri Vikas Agarwal (DIN: 00985596) was appointed as Member of the CSR Committee with effect from 7^th June, 2025.

The Annual Report on CSR activities for the financial year 2024-25 in the specified format is attached as Annexure - I and forms part of this report.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There are no any other material changes and commitments between the end of the financial year to which this financial statements relate and the date of this Report which may materially affect the financial position of the Company or having any material impact on the operations of the Company.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

There are no significant and material orders passed by the Regulators/Courts/Tribunal that would impact the going concern status of the Company and its future operations.

DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

The Company does not have a Subsidiary/Joint Venture and have an Associate Company during the year under review i.e. Crown Craft (India) Private Limited. Further, during the reporting period, no Company has become or ceased to be a Subsidiary/Joint Venture.

The National Company Law Tribunal, Jaipur vide its order dated 23^rd May, 2025, has approved the Amalgamation Scheme between Clay Craft (India) Pvt. Ltd. (Transferee Company) and Ekling Ji Industries Pvt. Ltd. (Transferor Company) effective from 1^st April, 2024. Accordingly, the investment of Transferor Company i.e. Ekling Ji Industries Pvt. Ltd. in Crown Craft (India) Pvt. Ltd. is now the investment of Transferee Company i.e. Clay Craft (India) Pvt. Ltd. Hence, the Crown Craft (India) Pvt. Ltd. is now an Associate Company of Clay Craft India Ltd. with effect from 1st April, 2024.

The Statement containing salient features of the financial statement of its Associate Company is attached in form AOC-1 as Annexure - II.

PERFORMANCE HIGHLIGHTS AND FINANCIAL POSITION OF ASSOCIATE COMPANY

Crown Craft (India) Private Limited (hereinafter referred to as “CCIPL”) is an Associate Company of your Company. During the year under review, the total Revenue from Operations of CCIPL have increased to Rs. 1917.63 Lakh as against Rs. 1742.89 Lakhs recorded in the previous year. The Loss after tax was Rs. 255.05 Lakh as against Loss of Rs. 221.42 Lakh recorded in the previous financial year. The earnings per share for the financial year 2024-25 was Rs. (0.72) as compared to Rs. (0.88) per share in the previous financial year.

DEPOSITS

During the year under review, the Company has not accepted any deposit falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Further, the Company has not accepted any deposit in earlier years, as such question of unpaid or unclaimed deposit and default in repayment of deposits does not arise.

Moreover, the Company has taken unsecured loan of Rs. 638 Lakhs/- (Refer Note No. 4 of Balance Sheet) from its Directors & their relatives, for which the declaration have been furnished in writing in compliance with the provisions of Rule 2(1)(c)(viii) of the Companies (Acceptance of Deposits) Rules, 2014 as amended as on date that the amount is not being given out of funds acquired by them by borrowing or accepting loans or deposits from others.

AUDITORS

M/s. Temani & Associates, Chartered Accountants (FRN No. 004621C), Statutory Auditors of the Company who were appointed for a term of five consecutive years starting from 1^st April, 2022 to 31^st March, 2027 have tendered their resignation from the position of Statutory Auditors of the Company resulting into a casual vacancy in the office of Statutory Auditors of the Company.

M/s. Kuldeep Kumar Gupta & Co, Chartered Accountants, (FRN No. 002703C), were appointed by the members of the Company at their Extra-Ordinary General Meeting held on 22^nd January, 2025, as the Statutory Auditors of the Company to fill the casual vacancy caused by the resignation of M/s. Temani &

Associates, Chartered Accountants, (FRN No. 004621C) for the period of accounts from 01/04/2024 to 31/03/2025.

The term of M/s. Kuldeep Kumar Gupta & Co, Chartered Accountants, (FRN No. 002703C), shall be expiring in the ensuing Annual General Meeting and the Board recommended to the members for the appointment of M/s. Kuldeep Kumar Gupta & Co, Chartered Accountants, (FRN No. 002703C), as Statutory Auditors of the Company for a period of five consecutive years (period of accounts from 01.04.2025 to 31.03.2030) from the conclusion of ensuing 37^th Annual General Meeting till the conclusion of 42^nd Annual General Meeting of the Company.

AUDITORS REPORT

There are no qualifications, reservations or adverse remarks in the Auditors Report which require clarification/explanation.>

PARTICULARS OF FRAUD REPORTED BY THE AUDITORS

During the year under review, no frauds were reported by the Auditors of the Company under Section 143(12) of the Companies Act, 2013.

COST RECORDS

Maintenance of Cost Records as specified by the Central Government under Sub-Section (1) of Section 148 of the Companies Act, 2013, is not required by the Company and accordingly, such accounts and records are not made and maintained.

THE CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

A. Conservation of Energy

B. Technology Absorption

C. Foreign Exchange Earnings and outgo

The Foreign Exchange earnings and outgo during the financial period ended 31^st March, 2025 is as follows:

(Rs. In Lakhs)

PARTICULARS OF EMPLOYEES

During the year under review the Company was a Private unlisted Company as on 31^st March, 2025, therefore the provisions of Section 197(12) of Companies Act, 2013 read with rule 5(2) of Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014 is not applicable on the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT 2013

Particulars of the Investment made are provided in Note No. 13 forming part of the Financial Statements. Further, the Company has not given any loan and guarantee and the Company has complied with applicable provisions of Companies Act, 2013 in this regard.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered by the Company during the financial year ended 31^st March, 2025 with related parties were in the ordinary course of the business and on arms length basis. There was no such transaction entered during the reporting year which could be considered material. Details with respect to transaction(s) with the Related Party(ies) entered into by the Company during the reporting period are disclosed in the accompanying Financial Statements and the details pursuant to clause (h) of Section 134(3) of act and Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Form AOC-2 is annexed as Annexure - III.

However, your Directors would like to draw your attention towards the related party transactions as provided under Note No. 29 of the financial statements.

INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY

The Company has adequate internal controls and processors in place with respect to its financial statements which provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements. The Company has a mechanism of testing the controls at regular intervals for their design and operating effectiveness to ascertain the reliability and authenticity of financial information.

RISK MANAGEMENT

The Board of Directors of the Company identify, evaluate business risks and opportunities. The Directors of the Company take pro-active steps to minimize adverse impact on the business objectives and enhance the Companys competitive advantage. Presently no material risk has been identified by the Directors except of general business risks, for which the Company is leveraging on their expertise and experience. The Board periodically reviews and improves the adequacy and effectiveness of its risk management systems considering rapidly changing business environments and evolving complexities. There are no risks, which in the opinion of the Board threaten the existence of the Company.

COMPLIANCE WITH THE APPLICABLE SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by Institute of Companies Secretaries of India and that such systems are adequate and operating effectively.

MATERNITY BENEFIT

During the period under review, the Company has complied with the provisions relating to the Maternity Benefit Act, 1961.

VIGIL MECHANISM POLICY

The Company has established a Vigil Mechanism Policy for grievances Redressal of the Directors and employees of the Company which will help in reporting genuine concerns or grievances of Directors and employees, actual or suspected fraud and it provides adequate safeguards against victimization. A Complainant can send a written complaint to the Vigilance Officer of the Company. The Provisions of the policy are also in line with the provisions of Section 177(9) & (10) of the Companies Act, 2013. The details of the vigil mechanism are posted on the website of the Company at www.claycraftindia.com. During the financial year 2024-25, no cases under this mechanism were reported to the Company.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013 with respect to Directors Responsibility statement it is hereby Stated:

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

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

(e) that the company was the private unlisted company for the financial year ended 31^st March, 2025, therefore the provisions of section 134(5)(e) of Companies Act, 2013 is not applicable on the company.

(f) that 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.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

During the year under review, no complaint has been received under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Further, 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 and as amended from time to time.

Details of complaints during the year under review are as under:

OTHER DISCLOSURES

1. Being a Private Unlisted Company as on 31^st March, 2025, it does not require to appoint any Independent Director in the Board and Company does not have any Independent Director in the Board, hence the disclosure specified in section 134(3)(d) of the Companies Act, 2013 read with rule 8 of the Companies (Accounts) Rules, 2014 relating to Statement by Independent Director is not applicable to the Company.

2. Being a Private Unlisted Company as on 31^st March, 2025, Section 178 relating to Nomination and Remuneration committee is not applicable to the Company.

3. Being a Private Unlisted Company as on 31^st March, 2025, Section 177 relating to Audit Committee is not applicable to the Company.

4. Being a Private Unlisted Company as on 31^st March, 2025, provisions relating to Section 134(3) (p) of the Companies Act, 2013 are not applicable to the Company.

5. During the year under review, Company was not required to transfer any amount to the Investor Education and Protection Fund Account. Further, the Company also does not have any amount which is required to transfer to IEPF account.

6. No application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

7. The requirement of disclosure of Details of Difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable during the period under review.

8. The National Company Law Tribunal, Jaipur vide its order dated 23^rd May, 2025, has approved the Amalgamation Scheme between Clay Craft (India) Pvt. Ltd. (Transferee Company) and Ekling Ji Industries Pvt. Ltd. (Transferor Company) effective from 1^st April, 2024.

9. The members of the Company has approved the sub-division of Shares on 14^th June, 2025 from Rs. 100/- each to Rs. 10/- each.

10. The members of the Company has approved the Bonus Issue in the ratio of 2:1 on 26^th June, 2025 to the existing members of the Company.

11. The Company has been converted from Private Limited Company to Public Limited Company with effect from 15 ^th July, 2025.

ACKNOWLEDGEMENT

The Board of directors of your Company acknowledges its sincere appreciation for the support extended by various departments of Central and State Government and others. The Board also takes this opportunity to express its deep gratitude for the continuous support received from the Shareholders.