Faze Three Ltd Directors Report

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2025

To,

The members of

Faze Three Limited

The Board of Directors are pleased to present the 40th Annual Report of your Company containing the business performance and the Audited Financial Statements for the Financial Year ended March 31, 2025.

1. FINANCIAL PERFORMANCE (STANDALONE & CONSOLIDATED)

(INR in Crores)

Particulars	For the Year	For the Year	For the Year	For the Year
	ended	ended	ended	ended
	31.03.2025	31.03.2024	31.03.2025	31.03.2024
	(Standalone)	(Standalone)	(Consolidated)	(Consolidated)
Revenue from Operations	658.91	535.85	689.94	564.52
Other Income	14.02	8.70	11.80	7.80
Total Income	672.93	544.55	701.74	572.32
Less- Total expenses	621.51	487.31	649.09	509.87
Profit before tax	51.42	57.24	52.65	62.45
Less - Tax expense
(incl. deferred tax)	11.59	15.13	11.99	15.86
Profit for the year	39.83	42.11	40.66	46.59
Other comprehensive income
for the year	(0.28)	(0.56)	(0.27)	(0.56)
Total comprehensive income
for the year	39.55	41.55	40.39	46.03
Earnings per share (INR)
Basic	16.38	17.31	16.72	19.16
Diluted	16.38	17.31	16.72	19.16

The above figures are extracted from the Standalone and Consolidated Financial Statements for the Financial Year ended March 31, 2025, forming part of this Annual Report, which have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs and provisions of Section 133 of Companies Act, 2013 (‘the Act) read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time and other relevant provisions of the Act.

2. KEY HIGHLIGHTS OF THE FINANCIAL PERFORMANCE/ STATE OF THE COMPANYS AFFAIRS Consolidated-

Revenue from operations for year ended March 31, 2025 stood at INR 689.94 Crores as against INR 564.52 Crores for the previous year ended March 31, 2024.

Net Profit after Tax (NPAT) for year ended March 31, 2025 stood at INR 40.66 Crores as against INR 46.59 Crores for year ended March 31, 2024.

EBIDTA for year ended March 31, 2025 stood at INR 92.23 Crores as against INR 94.3 Crores for year ended March 31, 2024.

Standalone-

Revenue from operations for year ended March 31, 2025 stood at INR 658.91 Crores as against INR 535.85 Crores for the previous year ended March 31, 2024.

NPAT for year ended March 31, 2025 stood at INR 39.83 Crores versus INR 42.11 Crores for year ended March 31, 2024

EBIDTA for year ended March 31, 2025 stood at INR 89.72 Crores as against INR 88.37 Crores for year ended March 31, 2024

3. DIVIDEND

The Board of Directors have decided to retain the resources to fuel the growth and objectives of the Company and therefore, have not recommended any dividend for the Financial Year ended March 31, 2025. The Directors are confident to derive optimum utilization out of the same, which shall be in the best interest of the stakeholders.

4. SHARE CAPITAL

The Authorised Share Capital of the Company is INR 26,00,00,000/- divided into 2,60,00,000 equity shares of face value of INR 10/- each. The paid-up share capital of the Company is INR 24,31,90,000/- divided into 2,43,19,000 equity shares of face value of INR 10/- each.

During the F.Y. 2024-25 there was no change in the share capital of the Company.

5. RESERVES

There were no appropriations to reserves/ general reserves during the year under review. The closing balance of the retained earnings of the Company for the FY 2024-25 is INR. 219.64 Crores on standalone basis and INR 222.89 Crores on consolidated basis.

6. DEPOSITS/ LOANS FROM DIRECTORS

The Company has not accepted any deposits from the public falling within the ambit of Section 73 and 76 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 and Chapter V of the Act. The Company has not accepted any deposit or any loan from the directors during the year under review.

7. SUBSIDIARY OR ASSOCIATE OR JOINT VENTURE COMPANY

The Company has two wholly owned subsidiaries as on March 31, 2025, namely:

i. Faze Three US LLC

The Company has a wholly owned subsidiary (WOS) in USA viz. Faze Three US LLC which is a front office of the Company in USA and is actively engaged in sourcing local business within USA for supplying the Companys range of products to stores/ retailers.

The Total Income of WOS for FY 2024-25 stood at USD 0.83 MN [INR 6.99 Crores] vs USD 1.17 MN [INR 9.72 Crores] for FY 2023-24. The Profit before Tax for FY 2024-25 stood at USD -0.064 MN [INR 0.5 Crores] as against PAT of USD 0.15 MN [INR 1.32 Crores] during previous year.

ii. Mats and More Private Limited

The Company has a wholly owned subsidiary (WOS) incorporated in India viz. Mats and More Private Limited. The WOS is engaged in the business of manufacturing, import, export and dealing in patio mats, floor covering, indoor and outdoor furnishing products including other furnishing products.

The Total Income of WOS for FY 2024-25 stood at INR 26.75 Crores vs INR 21.69 Crores for FY 2023-24. The PBT for FY 2024-25 stood at INR 2.34 Crores vs INR 3.85 Crores for FY 2023-24.

Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of financial statements of the WOS in Form AOC-1 forms part of this Annual Report as ANNEXURE I. Copies of the financial statements of the subsidiary companies are available on the Companys website at https://www.fazethree.com/investors/financial-results.

During the year under review, no company has become or has ceased to be a Subsidiary, Associate or Joint Venture of the Company.

8. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(3)(c) of the Act, with respect to the Directors Responsibility Statement, the Directors hereby confirm that:

(i) in the preparation of the Annual Financial Statements for the year ended March 31, 2025, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) such accounting policies as mentioned in Notes to Financial Statements have been selected and applied consistently and judgements and estimates have been made 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 the Company for the year ended on that date;

(iii) proper and sufficient care has been taken 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;

(iv) the Annual Financial Statements for the year ended March 31, 2025 have been prepared on a going concern basis;

(v) proper internal financial controls were in place to be followed by the Company and that the financial controls were adequate and were operating effectively;

(vi) proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

9. MEETINGS OF THE BOARD

The Board meets at regular intervals to discuss and decide on Company/ Business policy and strategy apart from other Board businesses. In case of any urgent business need, where the meeting of the Board of Directors is not envisaged, the Boards approval is taken by passing resolutions by circulation, as permitted by law, which are noted and confirmed in the subsequent Board Meeting.

The details of number of Board meetings of the Company are set out in the Corporate Governance Report, which forms part of this Report. The intervening time gap between two consecutive Meetings was within the period prescribed under the Act.

10. COMMITTEES OF THE BOARD

The details of all the Committees of the Board along with their terms of reference, composition and meetings held during the year are provided in the Corporate Governance Report which forms a part of this Report.

11. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE

RESIGNED DURING THE YEAR

As on March 31, 2025, the Board of Directors of the Company comprised of the following:

Mr. Ajay Anand	:	Chairman and Managing Director
Mr. Sanjay Anand	:	Whole Time Director
Mrs. Rashmi Anand	:	Non-Executive Director
Mr. Chuji Kondo	:	Independent Director
Mr. James Leonard	:	Independent Director
Mr. Manan Shah	:	Independent Director
Mr. Vinit Rathod	:	Independent Director
Mr. Devajyoti Bhattacharya	:	Independent Director

During the year under review, Mr. Devajyoti Bhattacharya was appointed first as an Additional Director by the Board on November 13, 2024, whose appointment was later regularized as an Independent Director by the Shareholders of the Company by passing a Special Resolution on January 16, 2025 via Postal Ballot, thereby changing the composition of the Board.

Moreover, following Directors were re-appointed by the Shareholders of the Company at the last AGM held in 2024 by way of special resolution:

1. Mr. Ajay Anand (DIN: 00373248) as the Managing Director of the Company for a period of 5 (five) years with effect from April 1, 2025 to March 31, 2030.

2. Mr. Sanjay Anand (DIN: 01367853) as the Whole-time Director of the Company for a period of 5 (Five) years with effect from April 1, 2025 to March 31, 2030

On the basis of the written representations received from the Directors, none of the above Directors is disqualified under Section 164 of the Act.

During the year under review, no changes took place in the position of Key Managerial Personnel.

Accordingly, following are the Key Managerial Personnel of the Company as on March 31, 2025:

Mr. Ajay Anand	:	Managing Director
Mr. Sanjay Anand	:	Whole-time Director
Mr. Ankit Madhwani	:	Chief Financial Officer
Mr. Akram Sati	:	Company Secretary & Compliance Officer

The Company has complied with the requirements of having Key Managerial Personnel as per the provisions of Section 203 of the Act.

12. PERFORMANCE EVALUATION OF BOARD

Pursuant to Section 178 of the Act read with Schedule IV thereto and Regulation 17 of the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements), Regulations 2015 ("Listing Regulations"), a formal evaluation of Boards performance and that of its Chairperson, its Committees and individual directors has been carried out by the Board.

The evaluation of all the directors including independent directors was carried out by the entire Board, except for the director being evaluated. The performance is evaluated after seeking inputs from all the Directors, through a structured questionnaire, on the basis of the criteria such as the Board composition and structure, experience and competencies, attendance, effectiveness of board processes, information and functioning, independent approach, etc. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the SEBI on January 05, 2017.

The performance of the Committees was evaluated by the Board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, attendance of the members, recommendations to the Board and their implementation, effectiveness of committee meetings, etc.

The Independent Directors at their separate meeting held on January 27, 2025 evaluated the performance of the Non-Independent Directors and the Board as a whole, the Chairman of the Board after considering the views of other Directors and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

The Board of Directors expressed their satisfaction with the outcome of the aforesaid performance evaluations.

13. DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have submitted requisite declarations confirming that they:

i. meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and are independent;

ii. have complied with the Code of Conduct laid down under Schedule IV of the Act and

iii. they have valid registration with the Independent Directors Databank maintained by the Indian Institute of Corporate Affairs.

In the opinion of the Board, the Independent Directors possess the requisite integrity, experience, expertise required under all applicable laws and the policies of the Databank.

14. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

The Board members are provided with necessary documents, reports and internal policies to enable them to familiarize with the Companys procedures and practices.

Pursuant to the SEBI regulations, the Company organizes Familiarization Programme periodically for the Independent Directors, with a view to familiarize them with their role, rights and responsibilities in the Company, nature of industry in which the Company operates, business model of the Company, etc. The Board familiarization process comprises of the induction programme for new Independent Directors, sessions on business and functional issues and strategy making. Periodic presentations are made at the Board and Committee meetings on business and performance updates of the Company including finance, sales, and overview of business operations, business strategy and risks involved.

During the year under review, the Independent Directors were familiarized on business model, key updates on business performance, and legal/ regulatory updates at Board Meetings as well as through periodic reports.

The policy for Familiarization Programme for the Independent Directors is available on website of the Company at https://www.fazethree.com/investors/corporate-governance.

15. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL

AND EMPLOYEES

In accordance with the provisions of Section 134(3)(e) read with Section 178(2) of the Act and Regulation 19(4) read with Part D of Schedule II of the Listing Regulations, your Company has adopted a Policy on Nomination & Remuneration which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors, and remuneration for the directors, key managerial personnel and other employees. The said policy can be accessed on the website of the Company at https://www.fazethree.com/investors/policies

16. DISCLOSURE RELATING TO REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONNEL AND

PARTICULARS OF EMPLOYEES

Disclosure pertaining to remuneration of employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Report as ANNEXURE II.

The information pursuant to Section 197 of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is provided as a separate Annexure forming part of this report which will be provided on request. In terms of Section 136 of the Act, the reports and accounts are being sent to the shareholders and others entitled thereto, excluding the said information, however, it is available for inspection by the shareholders in electronic mode, up to the date of AGM. Members can inspect the same by sending an email to the Company Secretary in advance at cs@fazethree.com.

Further, as on March 31, 2025, the Company has no employee who:

(i) if employed throughout the financial year, was in receipt of remuneration, in aggregate of INR 102.00 Lakhs or more, per annum or

(ii) if employed for part of the financial year, was in receipt of remuneration, in aggregate of INR 8.50 lakhs or more, per month or

(iii) if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company.

17. RECEIPT OF ANY COMMISSION FROM COMPANY OR RECEIPT OF COMMISSION/REMUNERATION

FROM ITS HOLDING OR SUBSIDIARY COMPANY BY MD / WTD / ANY DIRECTOR

During the year under review, the Company has not paid any commission to any of its Directors. Further, the Company does not have a holding company and none of the Directors of the Company have received any commission/ remuneration from its subsidiary companies.

18. ANNUAL RETURN

Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the draft Annual Return for Financial Year ended March 31, 2025, is placed on the website of the Company at https://www.fazethree.com/investors/corporate-governance.

19. CORPORATE SOCIAL RESPONSIBILITY STATEMENT (CSR)

A business cannot operate in isolation. To be truly profitable and sustainable, it must actively embrace its social responsibilities. The Company firmly believes that creating a positive synergy between business objectives and social impact is essential for long-term value creation. Social Responsibility has always been regarded as a core pillar of the Companys sustainable growth strategy. Over the years, the Company has contributed meaningfully to various social causes, reflecting its commitment to inclusive development. The management remains dedicated to the upliftment of society and the conservation of natural resources both of which are vital for holistic and enduring economic progress.

During the FY 2024-25, the Companys CSR obligation was INR 1,35,25,978/- (Rupees One Crore Thirty-Five Lakh Twenty-Five Thousand Nine Hundred and Seventy-Eight Only), being 2% of the average net profit during the preceding 3 year, towards the CSR contribution pursuant to the Rule 7(3) of the Companies (Corporate Social Responsibility Policy) Rules, 2014. However, post set-off of INR 23,16,233/- (Rupees Twenty-Three Lakh Sixteen Thousand Two Hundred and Thirty-Three Only), being excess amount spent in previous financial years, the Company was required to spend INR 1,12,09,745 /- (Rupees One Crore Twelve Lakh Nine Thousand Seven Hundred and Forty-Five Only) during FY 24-25.

However, on recommendation of the CSR Committee, the Company made a total CSR contribution of INR

1,20,00,000/- (Rupees One Crore and Twenty Lakh Only) during FY 2024-25 towards CSR activities by way of donations to Trusts/Societies working for the betterment and holistic upliftment of underprivileged sections of society. These contributions were aimed at supporting initiatives in areas such as health awareness, quality education, vocational training, and empowerment of economically weaker communities. The Company remains committed to making meaningful and focused interventions in line with its CSR policy and continues to support causes that promote inclusive development and social welfare, particularly in underserved regions.

The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the annual report on Corporate Social Responsibility (CSR) activities as per format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, is annexed as ANNEXURE III to this report.

The CSR policy has been posted on the website of the Company at https://www.fazethree.com/investors/ policies.

20. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The information as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption and foreign exchange earnings and outgoings is annexed to this report as ANNEXURE IV.

21. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Party Transactions are approved by the Audit Committee. Prior omnibus approval is obtained from the Audit Committee in respect of the transactions which are repetitive in nature. The transactions entered into pursuant to omnibus approval so granted are reviewed on a quarterly basis by the Audit Committee.

During the financial year, the Company has entered into transactions with related parties as defined under Section 2(76) of the Act and Listing Regulations. All related party transactions were carried out at arms length price and in the ordinary course of business.

Further, as per the Listing Regulations, if any related party transaction exceeds Rs 1,000 crore or 10% of the annual consolidated turnover as per the last audited financial statement, whichever is lower, would be considered as material and require Members approval. In this regard, the Company had taken necessary approval of the Members of the Company for Material Related Party Transactions undertaken with Faze Three Autofab Limited during the year under review. However, there were no material transactions of the Company with any of its related parties as per the Act. Therefore, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the Company for FY25 and, hence, the same is not required to be provided.

However, details of Related Parties and the transactions entered with them have been disclosed as required by the Indian Accounting Standards in the notes to the Financial Statements.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available at https://www.fazethree.com/investors/policies .

22. MATERIAL CHANGES AND COMMITMENT AFFECTING 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

No material changes or commitments, affecting the financial position of the Company occurred between the end of the financial year of the Company i.e. March 31, 2025 and the date of the Directors report.

23. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of the Listing Regulations, to report concerns about unethical behavior and provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the Code of Conduct of the Company and to report concerns about unethical behavior. No person has been denied access to the Chairman of the Audit Committee. The said policy has been posted on the website of the Company at https://www.fazethree.com/investors/policies

During the year under review, no complaint or adverse reporting was received by the designated officer of the Company.

24. DISCLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION

PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted Prevention of Sexual Harassment Policy in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder which is available on the website of the Company at https://www.fazethree.com/investors/policies

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

No complaints were received during the year under review.

25. RISK MANAGEMENT

The Company has in place a mechanism to inform Board of Directors about the Risk assessment and risk minimization procedures and periodical reviews to ensure that risk is controlled by the management through the means of a properly laid-out framework. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

26. INTERNAL FINANCIAL CONTROLS

The Company has adequate internal control systems, commensurate with the size, scale and complexity of its operations, which monitors business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels.

27. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report as required under Regulation 34 of the Listing Regulations is enclosed as ANNEXURE V.

28. CORPORATE GOVERNANCE

The Company believes in transparency and adhering to good corporate governance practices in every sphere of its operations. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated in the Regulation 15(2) of the Listing Regulations. A report on Corporate Governance is annexed to this report as ANNEXURE VI.

The Chairman and Managing Director and the Chief Financial Officer of the Company give annual certification on financial reporting and internal controls to the Board in terms of Regulation 17(8) of the Listing Regulations, copy of which forms part of the annexed Corporate Governance Report.

29. AUDITORS AND THEIR REPORT

A. STATUTORY AUDITORS AND AUDITORS REPORT

M/s. MSKA & Associates Chartered Accountants (Firm Registration No. 105047W), were appointed as the Statutory Auditor by the Members of the Company at the 37th Annual General Meeting of the Company, for a period of 5 years and shall hold the office till the conclusion of the 42nd Annual General Meeting of the Company, to be held in the calendar year 2027.

The Auditors Report on IND AS Financial Statements (Standalone and Consolidated) of the Company for the FY 2024-25, as submitted by M/s. MSKA & Associates, Chartered Accountants, does not contain any qualifications, reservations or adverse remarks and are self-explanatory.

There have been no instances of fraud reported by the Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.

B. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit of the Company for the FY 2024-25 was undertaken by M/s. Sanjay Dholakia & Associates, Practicing Company Secretary, which, inter alia, included audit of compliance with the Companies Act, 2013, and the Rules made thereunder, the Listing Regulations and other Regulations and Acts applicable to the Company. The Secretarial Audit Report is annexed to this report as ANNEXURE VII.

The Secretarial Auditors Report for the Financial Year ended March 31, 2025, does not contain any reservation, qualification or adverse remark.

30. COST AUDIT AND RECORDS

The Company maintains the cost records of its products as per the provisions of sub-section (1) of Section 148 of the Act. Pursuant to the provisions of sub-section (2) of Section 148 of the Act read with Rule 4(3)(i) of the Companies (Cost Records and Audit) Rules, 2014, the requirement of Cost Audit is not applicable to the Company.

31. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of loans, guarantees and investments covered under Section 186 of the Act, are provided in the notes to the Financial Statements forming part of this Annual Report.

32. DISCLOSURE ON ACCOUNTING TREATMENT

The Company has not used any differential treatment which is not in compliance with Accounting Standards and the financials of the Company depict a true and fair view of the state of affairs of the Company.

33. COMPLIANCE WITH SECRETARIAL STANDARDS BY ICSI

During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

34. BUSINESS RESPONSIBILITY AND SUSTAIN ABILITY REPORT ("BRSR")

Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective, are provided in the Business Responsibility and Sustainability Report ("BRSR") for the Financial Year 2024-25 which is included as a separate section in the Annual Report. The Company has prepared the BRSR report on a voluntary basis.

35. POLICIES AS REQUIRED UNDER VARIOUS LAWS

The Act and the SEBI Regulations mandate the formulation of certain policies for all listed Companies, the same are formulated by the Company, approved by the Board and amended from time to time. The said mandated policies are also available at the website of the Company at https://www.fazethree.com/investors/policies. The policies are as follows:

a. ‘Documents Retention & Archival Policy as per Regulation 9 and Regulation 30 of the Listing Regulations b. ‘Policy for determining Materiality of events / information as per Regulation 30 of the Listing Regulations c. ‘Policy for determining Material Subsidiary as per Regulation 16(1)(c) of the Listing Regulations

d. ‘Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information and ‘Insider Trading Policy as per the SEBI (Prohibition of Insider Trading) Regulation, 2015;

e. ‘Code of Conduct for Directors and Senior Managerial Personnel as per Regulation 17 (5) of the Lising Regulations.

36. EMPLOYEE STOCK OPTION SCHEME

The Company has adopted and implemented Faze Three Employee Stock Option Scheme 2024 (‘the Scheme) which was approved by the Shareholders of the Company at their 39th Annual General Meeting held in 2024 for granting Stock Options to the eligible employees.

The Scheme is in accordance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (‘SBEB & SE Regulations). There has been no material variation in the Scheme.

The certificate from the Secretarial Auditor of the Company on the implementation of the Scheme in accordance with the SBEB & SE Regulations (including any statutory modification(s) and/or re-enactment(s) thereof for the time being in force), has been uploaded on the website of the Company at https://www.fazethree.com/investors/esop

Further, the details required to be disclosed as per Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 and Regulation 14 read with Part F of Schedule I of SBEB & SE Regulations are available on the website of the Company at https://www.fazethree.com/investors/esop

The disclosure with respect to Section 67(3)(c) of the Act read with Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 is not applicable to the Company during the year under review.

37. OTHER DISCLOSURES

There was no change in the nature of the business of the Company during the year under review.

The Company has not issued any shares with differential rights as to dividend, voting or otherwise during the year under review.

The Company has not issued any Sweat Equity or Bonus Shares during the year.

There were no revisions in the financial statements or the Directors Report of the Company.

No application has been made under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("the IBC, 2016"), hence, the requirement to disclose the details of application made or any proceeding pending under the IBC, 2016 during the year along with their status as at the end of the financial year is not applicable.

The requirement to disclose the 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 year under review.

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

There are no amounts due and outstanding to be credited to Investor Education and Protection Fund (IEPF) as on March 31, 2025. However, the unclaimed interim dividend declared for the financial year 2017-18, which had been duly transferred to the Unclaimed Dividend Account in accordance with the provisions of Section 124 of the Companies Act, 2013, is due for transfer to the IEPF on June 26, 2025. All the concerned shareholders have been duly notified and reminded to claim their respective claims prior to the afore-mentioned date.

38. ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation for the co-operation extended by all the employees, Bankers, Financial Institutions, various State and Central Government authorities and Stakeholders.

FORM NO. AOC- 1 - STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENT OF SUBSIDIARIES/ ASSOCIATE COMPANIES/ JOINT VENTURES

(Pursuant to First proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)

Part "A": Subsidiaries:

Name of the subsidiary		Faze Three US LLC		Mats and More Private Limited
		(Foreign Wholly owned subsidiary)		(Indian Wholly owned subsidiary)
The date since when the subsidiary		October	16, 2017	March 11, 2022
was acquired
Reporting period for the subsidiary		April 01, 2024 March	31, 2025	April 01, 2024 March 31, 2025
concerned, if different from the
holding companys reporting period
Reporting currency and Exchange		Reporting Currency - US Dollar		Not applicable
rate as on the last date of the		(USD) Exchange Rate as on
relevant financial year in case of		March 28, 2025 -
foreign subsidiaries.
		1 USD = INR	85.5814
		(Amount in INR Crores)		(Amount in INR Crores)
Share Capital			2.44	0.10
Reserves & surplus			(0.97)	5.12
Total assets			1.55	58.78
Total liabilities	(other than equity)		0.27	53.56
Investments			-	-
Turnover			6.99	26.63
Profit / (Loss) before taxation			-0.51	2.34
Tax Expense			-0.01	0.40
Profit / (Loss) after taxation			-0.50	1.94
Proposed Dividend			-	-
% of shareholding			100%	100%

Notes:

1. Names of subsidiaries which are yet to commence operations: None

2. Names of subsidiaries which have been liquidated or sold during the year: None

3. Information under Part B is not applicable to the Company.

ANNEXURE II

Statement of Disclosure of Remuneration under Section 197 of Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

1. The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year:

Name of Director	Designation	Ratio to median remuneration of the Employees
Mr. Ajay Anand	Managing Director	20.42:1
Mr. Sanjay Anand	Whole time Director	11.43:1

Note: Since Non-Executive and Independent Directors received no remuneration, except sitting fees for attending Board / Committee meetings, the required details are not applicable.

2. The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Name	Designation	% Increase / Decrease of remuneration in 2025
		as compared to 2024
Mr. Ajay Anand	Managing Director	Nil
Mr. Sanjay Anand	Whole Time Director	Nil
Mr. Ankit Madhwani	Chief Financial Officer	Nil
Mr. Akram Sati	Company Secretary	NA*

*Mr. Akram Sati was appointed as the Company Secretary w.e.f. January 5, 2024, hence, his remuneration for the Financial Year 2024 25 is not comparable to that of 2023 24.

3. The percentage increase in median remuneration of employees in the financial year 15.31%

4. There were 857 permanent employees on the rolls of the Company as on March 31, 2025.

5. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

The average percentage increase made in the salaries of employees other than managerial remuneration was in the range of 16.32 % whereas the increase in the remuneration of Managerial personnel was Nil

6. We hereby affirm that the remuneration paid during the year ended March 31, 2025 is as per the Remuneration Policy of the Company.

ANNEXURE III

ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

1. Brief outline on CSR Policy of the Company

The Company has always recognized that its business is a part of the community where it operates. The CSR activities/projects are aligned to assist weaker and underprivileged sections of the society. The Company strives to implement its CSR programmes directly or in collaboration with other associations/trusts/NGO registered with concerned regulatory authorities who has expertise as well as establish presence in area for effective implementation of projects / use of funds.

The Company has undertaken various CSR initiatives so far including promoting skill and education among children and for the socially & economically marginalized communities especially scheduled castes, scheduled tribes, minorities, BPLs and other backward communities etc. The Company will continue to contribute in these areas and will simultaneously explore the opportunities to contribute towards other social causes through its CSR program.

2. Composition of CSR Committee:

Sr. No. Name of the Director	Designation/ Nature of Directorship	Number of meetings of CSR Committee held during the year	Number of meetings of CSR Committee attended during the year
1. Mr. Ajay Anand	Chairperson/Executive Director	2	2
2. Mr. Manan Shah	Member/Independent Director	2	2
3. Mr. Sanjay Anand	Member/Executive Director	2	2

 

3. The web-link where Composition of CSR committee, CSR Policy and CSR projects approved by the board are disclosed on the website of the company.	Committee Composition: https://www.fazethree.com/investors/board- committees CSR Policy:
	https://www.fazethree.com/investors/policies
4. Executive summary along with web link(s) of Impact assessment of CSR projects carried out in pursuance of sub-rule (3) of rule 8 of the Companies (Corporate Social responsibility Policy) Rules, 2014, if applicable.	Not Applicable

5. (a) Average net profit of the company as per section 135(5): INR 67,62,98,890/-

(b) Two percent of average net profit of the company as per section 135(5): INR 1,35,25,978/-

(c) Surplus arising out of the CSR projects or programmes or activities of the previous financial years: NIL (d) Amount required to be set off for the financial year, if any: INR 23,16,233/- (e) Total CSR obligation for the financial year (b+c-d): INR 1,12,09,745/-

6. (a) Amount spent on CSR Projects (both Ongoing Project and other than Ongoing Project) : INR

1,20,00,000/-

(b) Amount spent in Administrative Overheads: Nil

(c) Amount spent on Impact Assessment, if applicable: Not Applicable

(d) Total amount spent for the Financial Year (a+b+c): INR 1,20,00,000/-

(e) CSR amount spent or unspent for the financial year:

Total Amount		Amount Unspent (in INR)
Spent for the Financial Year (in INR)	Total Amount transferred to Unspent CSR Account as per Section 135(6)		Amount transferred to any fund specified under Schedule VII as per second proviso to Section 135(5)
	Amount	Date of Transfer	Name of Fund	Amount	Date of Transfer
1,20,00,000	Nil	N.A.	N.A.	Nil	N.A.

(f) Excess amount for set off, if any:

Sr. No. Particular	Amount (in INR)
(i) Two percent of average net profit of the company as per Section 135(5)*	1,12,09,745
(ii) Total amount spent for the Financial Year	1,20,00,000
(iii) Excess amount spent for the financial year [(ii)-(i)]	7,90,255
(iv) Surplus arising out of the CSR projects or programmes or activities of the previous financial years, if any	NIL
(v) Amount available for set off in succeeding financial years [(iii)-(iv)]	7,90,255

*The amount 1,12,09,745/- is the CSR obligation for FY 24-25 after set off of excess amount spent in the previous financial year. Please refer point 5 of this report for clarification.

7. Details ofUnspent CSR amount for the preceding three financial years:

Sr. No.	Preceding Financial Year(s)	Amount transferred to Unspent CSR Account under subsection (6) of	Balance Amount in Unspent CSR Account under subsecti	Amount Spent in the Financial Year	Amount transferred to a Fund as specified under Schedule VII as per second proviso to subsection (5) of section 135, if any		Amount remaining to be spent in succeeding Financial Years	Deficiency, if any
		section 135	on (6) of section 135		Amount	Date of Transfer
1.	FY 2023-24
2.	FY 2022-23				NIL
3.	FY 2021-22

8. Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year: No

If Yes, enter the number of Capital assets created/ acquired: Not Applicable

Furnish the details relating to such asset(s) so created or acquired through Corporate Social Responsibility amount spent in the Financial Year:

Sl. No.	Short particulars of the property or	Pincode of the	Date of creation	Amount of CSR	Details of entity/ Authority/ beneficiary of the registered owner
	asset(s) [including complete address and location of the property]	property or asset(s)		amount spent - ( in lacs)	CSR Registration Number, if applicable	Name	Registered address
			Not Applicable

9. Specify the reason(s), if the company has failed to spend two per cent of the average net profit as per section 135(5) - Not Applicable

ANNEXURE IV

STATEMENT PURSUANT TO SECTION 134 (3) OF THE COMPANIES ACT, 2013 READ WITH RULE 8(3) OF CHAPTER IX OF COMPANIES (ACCOUNTS) RULES, 2014.

CONSERVATION OF ENERGY

Capital investment and steps taken for Conservation of energy and for utilizing alternate sources of energy:

Environmental, Social, and Governance (ESG) principles have been integrated into the core strategy of the Company. In alignment with our commitment to sustainability and responsible manufacturing, the Company has taken several proactive steps towards energy conservation and the adoption of clean energy across its operations.

Key Initiatives Undertaken:

? Transition to Cleaner Fuels:

The Company transitioned its dyeing operations in North India from coal-based boilers to gas-based boilers. A long-term gas supply agreement has been signed with Indian Oil Adani Gas Private Limited. This shift has significantly reduced the Companys dependence on coal, lowered emissions, and contributed to the improvement of the local environment.

? Investment in Renewable Energy:

An aggregate investment of over 25 Crores has been made towards renewable and clean energy initiatives, including:

o Installation of 3.5 MW Rooftop Solar Power across manufacturing units in Silvassa, catering to approximately 35% of the Companys electricity requirements of said unit.

o Use of PNG (Piped Natural Gas) for processing operations.

o Deployment of lithium-ion (electric) material handling equipment (MHE) to reduce reliance on fossil fuels within warehouse and production premises.

? Energy Efficient Infrastructure and Equipment:

o The Company continues to invest in energy-efficient machinery, with energy consumption being a key consideration during procurement.

o The expanded manufacturing capacity at Silvassa has been designed with modern infrastructure including Li-ion powered warehouse trucks and forklifts, enhancing operational efficiency and reducing energy consumption.

o Installation of LED lighting across all units and use of transparent roofing and wall panels in warehouses and factory areas to maximize natural light, thus reducing energy usage.

? Rainwater Harvesting:

Rainwater harvesting systems have been implemented across all units in West and North India. These systems aid in groundwater recharge and support water conservation by collecting and storing rainwater for reuse.

? Sustainable Materials and Product Design:

The Company continues to focus on sustainable raw materials, including organic cotton, recycled polyester, and 100% recycled polypropylene in its product offerings. All manufacturing processes are designed to minimize carbon footprint and are regularly upgraded to enhance environmental performance.

? Eco-friendly Packing Initiatives:

The Company has taken significant steps to reduce the environmental impact of packaging by:

o Shifting to recyclable, biodegradable, and reduced-plastic packaging materials wherever feasible.

o Optimizing packaging dimensions to reduce material consumption and improve container loading efficiency, thereby reducing emissions during transportation.

o Collaborating with customers to co-develop sustainable packaging formats, including cartons and polybags made from recycled content.

o Introducing packing solutions for easier recyclability in alignment with global retailer expectations.

? Collaboration on Sustainability Projects:

The Company actively contributes to customer-led sustainability programs, reinforcing its position as a responsible manufacturer focused on resource conservation and circular economy practices.

In line with its commitment to sustainable manufacturing and energy conservation, the Companys initiatives are reinforced by a robust framework of globally recognized certifications. The ISO 14001 Environmental Management System certification underscores the Companys structured approach to minimizing environmental impact through efficient resource utilization and waste reduction. Additionally, certifications such as OEKO-TEX Sustainable Textile Production (STeP), Global Recycled Standard (GRS), Higg Index, and Better Cotton Initiative (BCI) further validate the Companys adherence to environmentally responsible practices across its energy, water, and material usage. These certifications not only ensure regulatory compliance but also drive continuous improvements in the Companys energy management systems, fostering a culture of sustainability and accountability at all levels of operations.

Energy consumption and sustainability were at the core of new expansions of various units.

The Company has also taken various steps to conserve energy such as installation of transparent sheets in warehouses to receive natural daylight minimizing use of power lights, Electric scooters to transport goods within unit, installation of Turbo ventilators on the roofs of the units.

RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION

Faze Three Limited continues to place strong emphasis on innovation, research, and technological advancement to remain ahead in a competitive global market. The Company has made significant investments in new technologies, product development capabilities, and sustainability-focused infrastructure to deliver high-quality, value-driven textile solutions for its global clientele.

With dedicated in-house design, R&D, and product development teams at each manufacturing location - supported by ISO certified laboratories the Company ensures robust product testing, quality control, and compliance with international standards. A newly added central Design Team at Head Office works in close coordination with marketing and development teams to expand product categories and deliver consumer-centric solutions.

To diversify into outdoor floor coverings, the Company invested in its wholly owned subsidiary, Mats and More Private Limited, which has successfully developed and commercialized patio mats. In its third year of operations, the subsidiary generated 26.63 Crores in revenue and 2.34 Crores in PBT, with a target of USD 10 million in revenue over the first 3 4 years.

The Company maintains a strong R&D pipeline by engaging closely with global retail partners, leveraging customer feedback and market insights to co-create products tailored to international markets. Technological upgrades across weaving, tufting, dyeing, and wet-processing machinery have also enabled the Company to deliver more efficient, cost-effective, and environmentally conscious manufacturing.

Importantly, the Companys commitment to global quality and sustainability standards is reflected in its wide array of industry-recognized certifications, including:

The integration of these certifications into the Companys R&D, production, and quality systems enhances transparency, customer trust, and global market access.

Through these initiatives, the Company has not only improved its operational efficiency and innovation capabilities but also demonstrated leadership in responsible manufacturing, aligned with the principles of Amenabar Bharat and ESG goals.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of the foreign exchange earnings and outgo of the Company during the year in terms of INR (Crores) is as below:

Particular	Amount
Total Foreign Exchange earned	582.53
Total Foreign Exchange used	58.61