Gala Precision Engineering Ltd Directors Report

Dear Shareholders of,

Gala Precision Engineering Limited (“the Company”)

The Board of Directors of Gala Precision Engineering Limited (Gala? or ‘Company?) are pleased to present the 18th (Eighteenth) Annual Report along with financial statements of the Company for the financial year ended March 31,2026. A summary of the Companys Audited Standalone and Consolidated Financial Statements is given below.

1. HIGHLIGHTS OF FINANCIAL RESULTS:

The Financial performance of the Company for the year under review as compared to the previous financial year are summarized below for your consideration:

(Rs. in Crores)

Particulars	Standalone	Consolidated
	2025-26	2024-25	2025-26	2024-25
Revenue from operations (Net)	314.30	237.84	314.30	237.84
Other income	5.63	4.37	5.63	4.37
Total revenue	319.93	242.21	319.93	242.21
Total expenses	275.63	209.00	275.41	208.82
Profit before exceptional items and tax	44.30	33.21	44.52	33.39
Add: Exceptional items	(0.82)	-	(1.13)	(0.26)
Profit before tax	43.48	33.21	43.39	33.13
Less: Tax expenses
(a) Current tax	7.45	6.68	7.45	6.68
(b) Deferred tax charge	0.49	(0.37)	0.49	(0.37)
Total tax expense	7.94	6.31	7.94	6.31
Non-controlling interest	-	-	(0.03)	(0.03)
Profit after taxes	35.54	26.90	35.48	26.85

2. Company?s performance and outlook:

Standalone:

The company achieved a net turnover of FY 2025-26: Rs. 314.30 Cr.; FY 2024-25 : Rs. 237.84 Cr. resulting in a growth of 32.15%. Our profit before exceptional items has grown significantly, reaching Rs. 44.30 Cr. from Rs. 33.21 Cr., representing an increase of 33.39.%.

The Company achieved Profit after tax (PAT) of Rs. 35.54 Cr in FY 2025-26, Rs.26.90 Cr. in FY 2024-25 representing an increase of 32.12%

Consolidated:

The company achieved a net turnover of FY 2025-26: Rs. 314.30 Cr.; FY 2024-25 : Rs. 237.84 Cr. resulting in a growth of 32.15%. Our profit before exceptional items has grown significantly, reaching Rs. 44.52 Cr from Rs. 33.39 Cr, representing an increase of 33.33.%.

The Company achieved Profit after tax (PAT) of Rs. 35.48 Crores in FY 2025-26, Rs.26.85 Crores in FY 2024-25 representing an increase of 32.14%

3. STATE OF COMPANY?S AFFAIRS:

The Company has undertaken initiatives towards sustainable operations, including implementation of a new solar power project of 1.8 MW near Nanded, Maharashtra.

The Company continued to strengthen its organizational capabilities through recruitment across middle and senior management levels and creation of new strategic roles.

During the year, the Company continued evaluating opportunities for future expansion and capacity enhancement, including identification of suitable land for upcoming projects.

4. CHANGE IN NATURE OF BUSINESS:

During the year, there has been no change in business of the Company.

5. DIVIDEND:

In view of the Companys strategic focus on identifying, executing, and successfully implementing key business projects across its operating verticals, the Board of Directors has prioritized the conservation of funds to support these long-term initiatives. To ensure sustainable growth in assets and revenue, and to strengthen the Companys financial position for future opportunities, it is deemed prudent to retain earnings for reinvestment.

Accordingly, the Directors have not recommended any dividend for the Financial Year 2025-26. This decision is aligned with the Companys commitment to enhancing long-term shareholder value through strategic expansion and sound financial management.

The Company has in place a Dividend Distribution Policy duly adopted by the Board on November 30, 2023 in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same is available on the Companys website at https://www.galagroup.com/wp-content/uploads/2024/01/ Dividend-Distribution-Policy.pdf

6. AMOUNT TRANSFERED TO RESERVES:

The Company has not transferred any amount out of the current year profits to the General Reserve of the Company.

7. ANNUAL RETURN:

Pursuant to section 134(3)(a) and Section 92(3) of Companies Act, 2013 read with relevant Rules framed thereunder, The Annual Return of the Company is available on the website of the Company at https://www.galagroup.com/ investor-relation-2/ under the field “Shareholder Information”.

8. NUMBER OF MEETINGS OF THE BOARD:

The Board of Directors met 4 (Four) times in the Financial Year 2025-26 i.e. on the following dates:

Sr.	Date of the Board Meeting
1.	May 27, 2025
2.	August 05,2025
3.	November 11, 2025
4.	February 05, 2026

During the period, your Company has complied with the Secretarial Standards 1 related to Board Meetings and Secretarial Standards 2 related to General Meetings issued by the Institute of Company Secretaries of India respectively

The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

9. DETAILS OF DIRECTORS/ KEY MANAGERIAL PERSONNEL:

DIRECTORS:

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Companys Articles of Association, Mr. Balkishan Jalan (DIN 02876873), Whole-time Director of the Company, retires by rotation at the forthcoming Eighteenth Annual General Meeting and being eligible has offered himself for re-appointment.

COMPOSITION OF BOARD OF DIRECTORS:

The composition of Board of Directors of the Company as on March 31, 2026 is as follows:

Sr. Name of the Director	DIN	Category	Period of Appointment
1. Kirit Vishanji Gala	01540274	Chairman and Managing Director	Five years commencing from November 30, 2023 to November 29, 2028
2. Balkishan Shyamsunder Jalan	02876873	Whole-time director (Executive)	Five years commencing from November 30, 2023 to November 29, 2028
3. Satish Dayal Kotwani	03154231	Whole-time director (Marketing)	Five years commencing from November 30, 2023 to November 29, 2028
4. Rajendra Vallabhaji Gogri	00061003	Non-Executive NonIndependent Director	Not applicable
5. Snehal Bhupendra Shah	00128595	Non-Executive Independent Director	Three years commencing from November 30, 2023 to November 29, 2026
6. Varsha Rajaram Galvankar	00124603	Non-Executive Independent Director	Re-appointed for second term for three years from November 30, 2025 to November 29, 2028.
7. Neha Rajen Gada	01642373	Non-Executive Independent Director	Three years commencing from November 30, 2023 to November 29, 2026
8. Sudhir Tokarshi Gosar	10460551	Non-Executive Independent Director	Three years commencing from January 11, 2024 to January 10, 2027

The Company has received a Declaration in Form DIR-8 from all the Directors stating that they are not disqualified under section 164 of the Companies Act, 2013. The Company has also received Form MBP-1 from all the Directors under Section 184 of the Companies Act, 2013.

KEY MANAGERIAL PERSONNEL (KMP):

The key managerial personnel(s) of the Company as on March 31, 2026 is as follows:

Sr. Name of the KMP	Designation
1. Kirit Vishanji Gala	Chairman & Managing Director
2. Balkishan Shyamsunder Jalan	Whole-time director Executive
3. Satish Dayal Kotwani	Whole-time director- Marketing
4. Giridhar Srinivasan	Chief Financial Officer
5. Pooja Ladha	Company Secretary & Compliance Officer

10. DECLARATION GIVEN BY INDEPENDENT DIRECTOR:

The Company has received necessary declarations and disclosures from the Independent Directors under Section 149(7) and Section 184(1) of the Companies Act, 2013 stating that they meet the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and under Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations") and disclosing their interest in form MBP-1.

Further, all Independent Directors of the Company have submitted declarations confirming that:

1. The disqualifications mentioned under sections 164, 167 and 169 of the Companies Act, 2013 do not apply to them.

2. They have complied with the Code for Independent Directors prescribed in Schedule IV to the Act as applicable.

3. They have registered themselves with Independent Directors Database of The Indian Institute of Corporate Affairs (‘IICA) and have cleared the online proficiency test of IICA, as applicable.

4. They are not aware of any circumstances or situations, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence; and

The Board of the Company has taken the disclosures and declarations on record after verifying the due veracity of the same. In the opinion of the Board, all the Independent Directors possess the integrity, expertise and experience including the proficiency required to be Independent Directors of the Company, fulfill the conditions of independence as specified in the Act and the SEBI Listing Regulations and are independent of the management and have also complied with the Code for Independent Directors as prescribed in Schedule IV of the Act. The Directors and the senior management personnel have affirmed compliance with the Code of Conduct for Directors and Senior Management Personnel.

11. FAMILIARISATION PROGRAMME:

In compliance with the requirements of Regulation 25(7) of the SEBI LODR Regulations, the Company has put in place a Familiarization Program for the Independent Directors to familiarize them with the Company, their roles,rights, responsibilities in the Company, nature of the industry in which the Company operates, business model etc.

The details of the Familiarization Program imparted to Independent Directors are available on the Companys official website at https://www.galagroup.com/wp-content/uploads/2024/10/Familiarization-Programme-Policy.pdf

12. SEPARATE MEETING OF INDEPENDENT DIRECTORS:

During the year under review, 1 (One) separate meeting of Independent Directors was held on March 25, 2026.

The details of the Independent Directors Meeting and the attendance of the Directors are provided in the Corporate Governance Report, which forms part of this Report.

13. DIRECTORS? RESPONSIBILITY STATEMENT:

To the best of their knowledge and belief and information obtained by them, your Directors make the following statement in terms of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013 (“the Act”):

a) In the preparation of the annual accounts for the year ended 31st March, 2026, 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 at the end of the financial year and of the profit and loss of 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 this Act 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 and,

e) They had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

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.

14. COMMITTEES OF THE BOARD

The Company has duly constituted the following statutory committees as per the provisions of the Act & SEBI LODR Regulations:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

Corporate Social Responsibility Committee TIT!!!;!!

Risk Management Committee

• Executive Committee

The details of the composition, number of Meetings, terms of reference and other information of all the aforesaid committees are included in the Corporate Governance Report which forms part of this Report.

Audit Committee:

The composition of the Audit Committee is as under:

Sr. No. Name of the Members	Designation
1. Mr. Snehal Shah	Chairperson
2. Ms. Neha Gada	Member
3. Mr. Balkishan Jalan	Member

During the year, there were no instances when the recommendations of the Audit Committee were not accepted by the Board of Directors of the Company.

15. ANNUAL PERFORMANCE EVALUATION

Pursuant to the provisions of the Act and SEBI Listing Regulations, performance evaluation was carried out as under:

Board of Directors

In accordance with the criteria suggested by the Nomination and Remuneration Committee, the Board of Directors evaluated the performance of the Board, having regard to various criteria such as Board composition, Board processes and Board dynamics. The Independent Directors, at their separate meeting, also evaluated the performance of the Board as a whole based on various criteria. The Board and the Independent Directors were of the unanimous view that performance of the Board of Directors as a whole was satisfactory.

Committees of the Board of Directors

The performance of the Audit Committee, the Corporate Social Responsibility Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee was evaluated by the Board having regard to various criteria such as committee composition, committee processes and committee dynamics. The Board was of the unanimous view that all the committees were performing their functions satisfactorily and according to the mandate prescribed by the Board under the regulatory requirements including the provisions of the Act read with the Rules made thereunder and SEBI LODR Regulations.

Independent Directors

In accordance with the criteria suggested by the Nomination and Remuneration Committee, the performance of each Independent Director was evaluated by the entire Board of Directors (excluding the Director being evaluated) on various parameters like qualification, experience, availability and attendance, integrity, commitment, governance, independence, communication, preparedness, participation and value addition. The Board appreciated the contribution made by all the Independent Directors in guiding the management and concluded that continuance of each Independent Director on the Board will be in the interest of the Company. The Board was also of the unanimous view that each Independent Director was a reputed professional and brought his/her rich experience to the deliberations of the Board.

Non-Independent Directors

The performance of each of the Non-Independent Directors (including the Executive Chairman) was evaluated by the Independent Directors at their separate meeting. Further, their performance was also evaluated by the Board of Directors. Various criteria considered for the purpose of evaluation included qualification, experience, availability and attendance, integrity, commitment, governance, communication etc. The Independent Directors and the Board were of the unanimous view that all the Non-Independent Directors were providing good business and people leadership.

16. PARTICULARS OF LOANS, GUARANTEE AND INVESTMENTS UNDER SECTION 186:

The Particulars of Loans, Guarantees and Investments made by the Company if any as at March 31, 2026 covered under the provision of Section 186 of the Companies Act, 2013 and are given in the Notes forming part of the Financial Statements.

17. PARTICULARS OF CONTRACT AND ARRANGEMENT UNDER SECTION 188:

All related party transactions that were entered into during the year under report were on an arms length basis and in the ordinary course of business.

The Disclosures as required under Indian Accounting Standard - 24 (Ind AS-24) "Related Party Disclosures as notified under Rule 7 of the Companies (Accounts) Rules, 2014 have been provided in Note No. 31(f) forming part of the Standalone Financial Statements.

The Companys Policy on materiality of related party transactions and on dealing with related party transactions is available on the Companys website at https://www.galagroup.com/wp-content/uploads/2024/01/RPT-policy.pdf

18. SHARES CAPITAL AND CHANGES THEREIN:

The Authorised Share Capital of the Company is Rs. 18,00,00,000/- (Rupees Eighteen Crores Only) divided into 1,80,00,000 (One Crore Eighty Lakhs Only) Equity Shares of Rs. 10/- (Rupees Ten only) each.

EMPLOYEE STOCK OPTION SCHEMES (ESOS):

ESOP 2021

The Board of Directors of the Company at its meeting held on December 24, 2021 approved an Employee Stock Option Plan called as the Gala Employees Stock Option Plan 2021 ("ESOP 2021"/ "Plan") and the shareholders of the Company approved the said Scheme at the Extra Ordinary General Meeting held on January 14, 2022.

Further, the approval was granted to the Board or any other committee of the Board to create, offer and grant from time to time upto 50,000 (Fifty Thousand) Employees Stock Options ("ESOPs") to the eligible employees of the Company.

Further, the Company has issued bonus shares in the ratio of 3:1, thereby increasing the total pool to 2,00,000 shares, out of which 1,46,200 shares are available for vesting and exercise.

Accordingly, the Nomination, Remuneration Committee ("the NRC Committee") vide circular resolution passed on following dates allotted equity share of your Company to option grantees upon exercise of stock options by them in terms of ESOP 2021:-

• on May 26, 2025, allotted 17,625 equity shares of Rs. 10 each fully paid up and at an exercise price of Rs. 87.50/- (Rupees Eighty-seven and Fifty Paisa Only) per share.

• on September 04, 2025, allotted 34,850 equity shares of Rs. 10 each fully paid up and at an exercise price of Rs. 87.50/- (Rupees Eighty-seven and Fifty Paisa Only) per share.

• on February 06, 2026, allotted 47,275 equity shares of Rs. 10 each fully paid up and at an exercise price of Rs. 87.50/- (Rupees Eighty-seven and Fifty Paisa Only) per share.

ESOP 2024

The Board of Directors of the Company at its meeting held on 8th July, 2024 approved an Employee Stock Option Plan called as the Gala Precision Engineering Employees Stock Option Plan 2024 ("ESOP 2024"/ "Plan") and the shareholders of the Company approved the said Scheme at the Extra Ordinary General Meeting held on August 6, 2024.

Further, the approval was granted to the Board or any other committee of the Board to create, offer and grant from time to time upto 3,00,000 (Three Lakhs) Employees Stock Options ("ESOPs") to the eligible employees of the Company and as approved by the members.

There has been no allotment of ESOP shares from the entire pool of 3,00,000 ESOPs, as on March 31, 2026.

A certificate from the Secretarial Auditors of the Company as required under Regulation 13 of the SEBI SBEB & SE

Regulations, 2021 shall be available electronically for inspection by the Members at the ensuing Annual General Meeting.

The disclosures as required to be made under the provisions of the Act and Rules made thereunder and under Regulation 14 of the SEBI SBEB & SE Regulations, 2021 read with SEBI Circular dated June 16, 2015 under various scheme as on March 31, 2026 is annexed as Annexure A to this Report and also disclosed in the accompanying financial statements.

BUY BACK OF SECURITIES:

The Company has not Bought Back Shares during the year under review.

SWEAT EQUITY:

The Company has not issued any Sweat Equity Shares during the year under review.

BONUS SHARES:

The Company has not issued any Bonus Shares during the year under review.

19. UNCLAIMED EQUITY SHARES AND DIVIDEND AND TRANSFER OF FUND TO IEPF AUTHORITY:

During the year under review, no amount was required to be transferred to Investor Education and Protection Fund (IEPF) as the Company has not declared any dividend in the past.

20. UTILISATION OF INITIAL PUBLIC OFFER (“IPO”) PROCEEDS:

Your Company is utilising IPO proceeds as per the objects stated in the prospectus of the Company and pursuant to Regulation 32 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (SEBI LODR Regulations") during the period under review, there was no deviation / variation in utilisation of funds raised in respect of the Initial Public Offering of the Company. The Company has appointed Crisil Ratings Limited as Monitoring Agency in terms of Regulation 41(2) of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 ("SEBI ICDR Regulations") and as amended from time to time, to monitor the utilisation of IPO proceeds. The Company has after placing before the Audit Committee and the Board, have made all the necessary compliances relating to submission of the statement(s) and report as required under Regulation 32 of the SEBI LODR Regulations to both the Stock Exchange(s) i.e. BSE Limited and National Stock Exchange of India Limited where the equity shares of the Company are listed.

Further, the Company has obtained reports from the Monitoring Agency from time to time and uploaded the same on the website of the Company for all the applicable quarters at https://www.galagroup.com/investor-relation/ under the "Shareholders Information" tab.

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

In terms of Section 134(3)(l) of the Companies Act, 2013, there have been no material changes and commitments affecting the financial position of the Company between the end of the Financial Year of the Company to which the

Financial Statements relate and to the date of Report.

22. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

During the period under review, there has been no significant and material orders passed by the regulators or courts

on the Company.

23. COMPANY?S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES:

Your Company has adopted a policy relating to appointment of Directors, payment of managerial remuneration, Directors qualifications, positive attributes, independence of Directors and other related matters as provided under section 178 (3) of the Companies Act, 2013 and Regulation 19 of SEBI Listing Regulations, which includes:

• Criteria for identification of persons for appointment as Directors and in senior management positions.

• Criteria for determining qualifications, positive attributes, independence of a Director

• Evaluation of performance

• Board Diversity

• Remuneration to Non-Executive Directors, Key Managerial Personnel and Senior Management and remuneration to other employees.

Policy Review

The Policy on Appointment and Remuneration of Directors, Key Managerial Personnel and Other Employees is available on the Companys website at https://www.galagroup.com/wp-content/uploads/2024/01/NRC-Policy.pdf

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

The Company is committed to provide a healthy environment to all the employees and thus does not tolerate any sexual harassment at workplace. The Company has in place a "policy against Sexual Harassment" of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees are covered under the policy. There was no complaint received from any employee during the financial year 2025-26 and hence no complaint is outstanding as on March 31, 2026 for redressed.

The disclosure under the said Act for the year ended March 31, 2026 is provided in the table below:

Sr. Particulars	No of Complaints
1. Number of complaints of sexual harassment received in the year	Nil
2. Number of complaints disposed off during the year	Nil
3. Number of cases pending for more than ninety days	Nil

Also the Internal Complaints Committee as required to be constituted by the Company has been duly constituted as per policy under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Policy is uploaded on the website of the Company at https://www.galagroup.com/wp-content/uploads/2024/01/ POSH-Policy.pdf

25. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION. FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, are as follows:

Conservation of energy

A. 1. Energy conservation measures taken:

Rs. In Crores

Particulars	2025-26	2024-25
Power consumption	8.30	6.47
Fuel & Diesel consumption	1.25	0.39
Generator hire charges	0.12	0.02

2. Solar Energy Conservation Measures & Savings

Rs. In Crores

Plot	Solar Capacity Installed	Units Generated	Rate / unit	Total Amount	Savings #
					2025-26	2024-25
295	620 kwp	374628	5.10	0.19	0.24	0.28
302	520 kwp	448712	4.98	0.22	0.24	0.31

#The applicable MSEDCL tariff during the year was approximately Rs.10.22 per unit. Against this, the effective Power procurement cost under the solar OPEX model for Plot No. 295 and Plot No. 302 was approximately Rs.5.10 per unit and Rs.4.98 per unit respectively, resulting in estimated savings of approximately Rs.5.12 per unit and Rs.5.24 per unit respectively on solar-generated electricity consumption during the year.

B. Green Initiative and Energy Cost Optimization:

As part of the Companys sustainability and energy cost optimisation initiatives, the rooftop solar plants at Plot No. 295 and Plot No. 302 continued to operate efficiently during the year, contributing towards energy savings and reduction in carbon footprint.

Further strengthening its renewable energy roadmap, the Company has undertaken a new solar power !!!!!!!! project at Nanded Capacity of 1.8 MW under the Open Access / Captive Consumption model. The project is currently under implementation and is expected to be commercialised by August 2026. Upon commissioning, the project is expected to further optimise energy costs, improve operational sustainability and increase the share of renewable energy consumption across the Companys operations.

In addition to renewable energy initiatives, the Company also continued to focus on operational improvements, infrastructure enhancement and strengthening of its human resources through strategic hiring across key functions during the year.

The Company remains committed to adopting environmentally responsible practices and continues to evaluate sustainable initiatives aligned with its long-term ESG (Environmental, Social and Governance) objectives.

Technology absorption

A. Future plan of action:

- Continuous Markets & product development.

- To continue Investment in Capacity Expansion & technology upgradation.

B. Technology absorption, adaptation and innovation:

1. Efforts in brief, made:	Continuous technology development & improvement in the process to enhance fatigue life of springs & performance of fasteners.
2. Benefits derived as a result of above efforts:	Springs & Fasteners with high performance. Several customer approvals received.
3. Technology imported	NIL

C. Foreign exchange earnings and Outgo-

With regard to foreign exchange earnings and outgo for the year 2025-26, the position is as under :

(Rs. in Crores)

Particulars	2025-26	2024-25
Income in foreign currency	111.51	89.43
Expenditure in foreign currency	2.34	2.30
CIF Value of Imports	13.98	18.7

26. Risk Management Policy:

Risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting. 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 principal risks that can impact its ability to achieve its strategic objectives. The Board periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework.

Further, details are provided in the Management Discussion and Analysis Report annexed to this Report.

The Company has in place a Risk Management Policy duly adopted by the Board on November 30, 2023 in accordance with Regulation 17(9)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 Listing Regulations and ("the Listing Regulations") and provisions of the Companies Act, 2013 ("the Act") the same is available on the Companys website at https://www.galagroup.com/wp-content/uploads/2024/01/Risk- Management-Policy-1.pdf

27. CORPORATE SOCIAL RESPONSIBILITY:

The Company firmly believes that Corporate Social Responsibility (‘CSR) is more than an obligation and more than

a duty, which helps to create positive impact on many lives. The Company persistently acts as a prudent corporate citizen and maintains harmonious relationship with the communities in which it operates to give back to the society.

As a part of its Corporate Social Responsibility (CSR) initiative, the Company has undertaken CSR projects and programs. These activities are in accordance with CSR activities as defined under the Act. The Company has a CSR Committee of Directors. Details about the Committee, CSR activities and the amount spent during the year, as required under section 135 of the Act and the related Rules and other details are given in the CSR Report as Annexure B forming part of this Report.

The Company has framed a CSR Policy in compliance with the provisions of the Act and the same is placed on the Companys website at https://www.galagroup.com/wp-content/uploads/2025/07/Corporate-Social-Responsibility- Policy.pdf The CSR Policy lays down areas of activities, thrust areas, types of projects, programs, modes of undertaking projects/ programs, resources etc.

28. MANAGEMENT DISCUSSION AND ANALYSIS REPORT. AND CORPORATE GOVERNANCE REPORT

Management Discussion and Analysis Report for the Financial Year ended March 31, 2026 as stipulated under Regulation 34(2)(e) read with Schedule V of the Listing Regulations, is included as a separate section forming part of this Annual Report.

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI LODR Regulations"), Corporate Governance Report along with the Certificate received from Mr. Dharmesh Zaveri, a Company Secretary in Whole-time Practice and proprietor of M/s. D.M. Zaveri & Co, confirming compliance with corporate governance requirements as per SEBI LODR Regulations are annexed as “Annexure C” respectively to this Report.

29. AUDITORS:

i. STATUTORY AUDITOR:

At the Sixteenth Annual General meeting held on September 30, 2024, the members of the Company approved the appointment of SCA & Associates, Chartered Accountants (Firm Registration No. 101174W), Chartered Accountants, as the Statutory Auditors of your Company to hold the office from the conclusion of the Sixteenth Annual General Meeting until the conclusion of the Twenty-First Annual General Meeting of the Company to be held in the year 2029.

There are no qualifications, reservations or adverse remarks made by SCA & Associates, in their report on Standalone and Consolidated Financial Statements and hence do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments.

ii. SECRETARIAL AUDIT

Pursuant to Section 204(1) of the Companies Act 2013 read with Regulation 24A of SEBI LODR Regulations, your Company had appointed Mr. Dharmesh Zaveri, a Company Secretary in Whole-time Practice and proprietor of M/s. D. M. Zaveri & Co, having Certificate of Practice No. 4363 and Membership No. 5418 as its Secretarial Auditor to conduct the secretarial audit of the Company for the Financial Year 2025-26. The Company during the audit has provided all assistance and facilities to the Secretarial Auditor for conducting their audit. The Secretarial Audit Report is annexed as Annexure D and forms an integral part of this report.

iii. COST AUDITOR:

Pursuant to Section 148 and other applicable provision if any, of the Companies Act, 2013 along with Companies (Cost Records and Audit) Rules, 2015 and the Companies (Audit and Auditors) Rules, 2014, the Company needs to maintain Cost records for the financial year 2025-26. Hence, M/s. Shekhar Joshi & Co. (Membership Number-10700) was duly appointed to conduct audit of cost records maintained by the Company pertaining to Disc Springs parts & Assemblies, Coil & Spiral Spring & Special Fastening Solutions business for the financial year 2025-26 at a remuneration of Rs. 75,000 (Rupees Seventy Five Thousands only) per annum plus Taxes and reimbursement of out of pocket expenses.

Further the company has made and maintained proper Cost Records as specified by the Central Government under Section 148 (1) of the Companies Act, 2013 for its business activities carried out during the year under review.

As required under the Companies Act, 2013, remuneration of Cost Auditors is required to be placed before the Members in the General Meeting for their approval. Your Directors propose ratification of remuneration of M/s. Shekhar Joshi & Co. (Membership Number-10700) for the Financial Year 2026-27.

iv. INTERNAL AUDITOR:

M/s. ASKA & Co, (Formerly known as Ambekar Shelar Karve & Ambardekar), Chartered Accountants, have been appointed as its Internal Auditor for conducting the internal audit functions of the Company and submitted their report thereon for the financial year 2025-2026 to the Board and committee for its review.

No disqualifications, reservations, adverse remarks or disclaimers have been reported in the Auditors Reports, requiring any explanation or comments by the Board of Directors of the Company.

30. STATUTORY AUDITORS? REPORT:

The Auditors Report on the Financial Statements (Standalone and Consolidated) of the Company for the year under review, is "with an unmodified opinion", as given by the Statutory Auditors. Also, no frauds in terms of the provisions of Section 143(12) of the Act have been reported by the Statutory Auditors in their report for the year under review.

31. EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QUALIFICATION. RESERVATION OR ADVERSE REMARKS MADE. IF ANY:

There are no qualifications, reservations, adverse remarks or disclaimers made by the Auditors in their report on the Financial Statement of the Company for the financial year ended March 31,2026.

32. INTERNAL FINANCIAL CONTROLS:

The Company has in place adequate internal financial controls with reference to Financial Statements.

It has laid down certain guidelines, policies, processes and structures which are commensurate with the nature, size, complexity of operations and the business processes followed by the Company. These controls enable and ensure the systematic and efficient conduct of the Companys business, protection of assets, prevention and detection of frauds and errors and the accuracy and completeness of the accounting and financial records.

Further, the Board reviews the internal control systems at regular intervals internally, the adequacy of internal audit function and significant internal audit findings with the management and update the same to the Audit Committee for

their review and for their recommendation to the Board.

33. SUBSIDIARY. JOINT VENTURES AND ASSOCIATE COMPANIES:

A. SUBSIDIARY:

As on March 31, 2026, the Company had 1 (One) subsidiary, the details of the Subsidiary is as follows:

Sr. No.	Name of the LLP / Company
1.	Gala Springs LLP

Further, the Company has 1 step down subsidiary as on the Financial Year end date i.e. March 31, 2026 which is Gala Precision Components (Shanghai) Private Limited. a foreign enterprise under Chinese Laws.

B. ASSOCIATE AND JOINT VENTURE COMPANY:

As on March 31,2026, there are no Associate Companies or Joint Venture within the meaning of Section 2(6) of the Companies Act, 2013.

34. PERFORMANCE AND FINANCIAL HIGHLIGHTS OF SUBSIDIARY COMPANIES AND THEIR CONTRIBUTION TO OVERALL PERFORMANCE OF THE COMPANY:

A Statement containing salient features of the financial statement of subsidiaries pursuant to first proviso to subsection (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 are enclosed as Annexure E to this report

35. CODE OF CONDUCT:

The Board of Director has approved a Code of Conduct which is applicable to the members of the Board of Directors and Senior Management Personnel. It is confirmed that all Directors and Senior Management Personnel have affirmed their adherence to the provisions of the Code of Conduct during the financial year 2025-26.

36. POLICIES AND DISCLOSURE REQUIREMENTS:

In terms of provisions of the Act and provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted the following Policies. The policies are available on Companys website at https://www.galagroup.com/investor-relations/

37. PUBLIC DEPOSITS:

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

38. PARTICULARS OF EMPLOYEES:

The disclosure required in terms of Section 197(12) of the Companies Act 2013 read along with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as Annexure G and forms part of this Report.

39. WHISTLE BLOWER POLICY / VIGIL MECHANISM:

Pursuant to Section 177(9) of the Act and read with Regulation 22 of the SEBI Listing Regulations, your Company has duly established Whistle Blower Policy /Vigil Mechanism Policy ("Policy") to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companys code of conduct. Functioning of the Policy is reviewed by the Audit Committee / Board on periodical basis. During the financial year ended March 31, 2026, the Company has not received any complaint under the Whistle Blower Policy of the Company. https://www. galagroup.com/wp-content/uploads/2025/07/Whistle-Blowing.pdf

40. MAINTAINANCE OF COST RECORDS:

Maintenance of cost records as specified by the Central Government under section 148(1) of the Companies Act,

2013, is required to be maintained by the Company and accordingly such accounts and records are made and maintained.

41. OTHER DISCLOSURES:-

No disclosures are required in respect of sub rule xi & xii of Rule 8(5) of The Companies (Accounts) Rules, 2014 read with Section 134(3)(q) as the same is not applicable to the Company during the Financial Year.

42. ACKNOWLEDGEMENTS:

The Board places on record its sincere appreciation and gratitude to the esteemed investors, various Central and State Government departments, organizations, and agencies for their continued support and cooperation extended to the Company.

The Board also extends heartfelt thanks to our valued customers, members, dealers, vendors, banks, and all other business partners for their unwavering trust and excellent support.

	For and on behalf of the Board
	Gala Precision Engineering Limited
	Sd/-	Sd/-
	Kirit V. Gala	Balkishan S. Jalan
Place : Thane	Chairman & Managing Director	Whole-time Director
Date : May 14, 2026	DIN:01540274	DIN: 02876873