Kanco Tea & Industries Ltd Directors Report

Results of Operations and the State of the Companys A3airs

The year under review was a challenging year for tea industry. The annual production of teas in North India for the f.y. 2025-2026 was 1152.98 million Kgs compared to 1090.32 million Kgs in f.y. 2024-2025. The average realisation of teas for North India went down from Rs. 224.55 in f.y. 2024-2025 to Rs.207.52 in f.y. 2025-2026. The average realization of our teas till 31st March, 2026 was Rs.249.07 as compared to Rs.290.95 for the previous year.

The results for the year ended 31st March, 2026 are lower mainly on account of lower price realization of teas.

The production of tea in April, 2026 has surpassed last year corresponding periods output. Speci3cally, the North In-dia production 3gure for April 2026 was recorded at 85.34 million kilograms, a signi3cant increase from 76.94 million kilograms in the same period of 2025. However, our own tea production 3gures remain lower.

The current market sentiment is experiencing a downturn, primarily due to an oversupply and subdued demand both domestically and internationally. This challenging environment for the tea industry is anticipated to persist into the upcoming year. Notably, the average realization of our teas was lower in the previous year. However, the company has proactively implemented measures to mitigate this issue, which bodes well for our future prospects. With a steadfast commitment to producing high-quality tea, we are con3dent in our ability to navigate these challenging conditions and achieve favourable outcomes.

In the 3nancial year 2025-2026, 20.36 hectares, 12.22 hectares and 8.94 hectares of the plantation area were replanted, rehabilitated and uprooted respectively. Investment in factory machinery has also been made to upgrade the machineries and also to enhance quality of teas.

The Company is registered as a medium enterprise under Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 bearing Udyam Registration Number UDYAM-WB-10-0003498. This has resulted in lower interest rate charged for loans taken from bank and the Company will also avail other bene3ts as and when announced for MSME.

Certi3cations

Mackeypore Tea Estate & Lakmijan Tea Estate has been issued veri3cation certi3cate bearing no.TS-VC/ CB/00001286/2023 under trustea code for sustainable tea in India by Control Union. Bamonpookrie Tea Estate has also been issued veri3cation certi3cate bearing no. TS-VC/CB/00000471/2021 under trustea code for sustainable tea in India by Control Union. The trustea code covers social, agronomic, food safety, occupational health & safety and environmental criteria.

Dividend

The Directors of your Company has not recommended any dividend for the year under review.

Transfer to Reserves

During the year under review, the Board does not propose any amount to be transferred to general reserve.

Share Capital

As on 31st March, 2026, the issued, subscribed and paid-up share capital of your Company stood at Rs. 5,12,28,270. During the year under review, the Company has not issued any shares or any other securities.

Annual Return

Pursuant to Section 134(3)(a) of the Act, the Annual Return of the Company prepared as per Section 92(3) of the Act for the 3nancial year ended March 31, 2026, is available on the Companys website and can be accessed at https:// kancotea.in/pdf/2026-2027/Annual%20Return%20for%20the%20year%20ended%2031st%20March,%20 2026.pdf In terms of Rules 11 and 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return shall be 3led with the Registrar of Companies, within prescribed timelines.

Directors

As of the date of this report, the Board of Directors of the Company comprises of 6 (Six) members with 2 (two) Executive Directors, 1(one) Non-Executive Non-Independent Director and 3 (Three) Non-Executive Independent Directors.

During the year under review, Mr. Umang Kanoria (DIN: 00081108) was reappointed as the Managing Director for a period of 3 years e3ective from 1st August, 2025, liable to retire by rotation.

In terms of Section 149 and other applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Ms. Shruti Swaika (DIN: 07659238) being eligible has o3ered for reappointment as an Independent Director for the further period of 5(3ve) years at the ensuing Annual General Meeting. Further in accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Dipankar Sa-manta (DIN: 10176966), Non-Executive Non-Independent Director retires by rotation at the ensuing Annual General Meeting and being eligible has o3ered himself for reappointment.

The Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 read with rules related thereto and Regulations 16(1)(b) and 25(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Directors of the Company have con3rmed that they have complied with the Companys Code of Conduct. In the opinion of the Board, the Independent Directors, ful3ll the conditions of independence speci3ed in Section 149(6) of the Companies Act, 2013 and Regulations 16(1)(b) and 25(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Separate meeting of the Independent Directors was held once during the year under report.

Board Evaluation

The Company has devised a Policy for Performance Evaluation of Independent Directors, Board, Committees and other Directors which includes criteria for performance evaluation of the non-executive Directors and Executive Directors under section 178(1) of the Companies Act, 2013 and SEBI Listing Regulations. On the basis of the Policy, a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees, culture, execution and performance of speci3c duties, obligations and governance.

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations. The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, e3ectiveness of committee meetings wherein adequate opportunity is given to the members to share their views, e3ective contribution in Boards decision by recommendations made by Committee etc

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, Communication and contribution in the discussions in a positive and constructive manner impacting company performance etc. At the board meeting the performance of the Board, its committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated. The Board of Directors expressed their satisfaction with the evaluation process.

Policy on Directors Appointment, Remuneration etc.

The Nomination and Remuneration Committee selects the candidates to be appointed as the Director on the basis of the requirement and enhancing the competencies of the Board. The policy ascertains balance of executive and non-executive Independent Directors to maintain the independence of the Board. The composition of Board of Directors during the year ended 31st March, 2026 is in conformity with Regulation 17 of the SEBI Listing Regulations, read with Section 149 of the Companies Act, 2013. The Company has policy, namely Nomination and Remuneration Policy, to govern directors appointment, including criteria for determining quali3cations, positive attributes, independence of a director and other matters, as required under sub- section (3) of Section 178 of the Companies Act, 2013 and the remuneration to the Directors. The policy can be viewed at http://kancotea.in/pdf/2017-2018/NOMINA-TION%20AND%20REMUNERATION%20POLICY.pdf.

Key Managerial Personnel

The following persons are the Key Managerial Personnel (KMP) of the Company in compliance with the provisions of Section 203 of the Companies Act, 2013:

a) Mr. U. Kanoria (DIN:00081108), Managing Director b) Mrs. A. Kanoria (DIN:00081172), Whole-time Director c) Ms. Charulata Kabra, Company Secretary d) Mr. S. K. Parhi, Chief Financial O3cer

Number of Meetings of the Board

During the FY 2025-2026, 4(four) Meetings of the Board of Directors of the Company were convened and held. The particulars of Meetings held and attended by each Director are detailed in the Corporate Governance Report that form part of this Annual Report.

Audit Committee

In accordance with the provisions of Section 177(8), the Company has duly constituted an Audit Committee which performs the roles and functions as mandated under the Act, SEBI Listing Regulations and such other matters as prescribed by the Board from time to time. Details of the composition, attendance at its meetings and other details have been furnished as a part of the Corporate Governance Report. There have not been any instances during the year under review, when the recommendations of the Committee were not accepted by the Board.

Other Committees

The Company has various other committees, viz, Nomination and Remuneration Committee, Finance and Investment Committee, CSR Committee and Stakeholder Relationship Committee in compliance with the provisions of the Companies Act, 2013 read with rules related thereto and SEBI Listing Regulations. The detail of such committees are given in the segment of Corporate Governance Report.

Directors Responsibility Statement

The Directors hereby con3rms that

a) in the preparation of the annual accounts, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) they had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of a3airs of the Company as at 31st March, 2026 and of the loss of the Company for the year ended on that date;

c) they had taken proper and su3cient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they had prepared the annual accounts on a going concern basis;

e) they had laid down internal 3nancial control to be followed by the company and that such internal 3nancial controls are adequate and were operating e3ectively; and

f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating e3ectively.

Statutory Auditors

The Members of the Company at the Annual General Meeting held on 13th August, 2024 approved the appointment of M/s NKSJ & Associates, Chartered Accountants (Registration No. 329563E) as the Statutory Auditors of the Company for a period of 3ve years commencing from the conclusion of the 41st AGM till the conclusion of the 46th AGM. The Company has received the consent and eligibility certi3cate from M/s NKSJ & Associates stating that they are not disquali3ed within the meaning of Section 141 of the Companies Act 2013. They have also con3rmed that they hold a valid peer review certi3cate as prescribed under regulation 33(1) (d) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The details relating to fees paid to the Statutory Auditors are given in the Note No.33.1 of the Standalone Financial Statements.

Statutory Auditors Report

The Reports given by M/s NKSJ & Associates, Chartered Accountants on the Financial Statements of the Company for Financial Year 2025-2026 does not contain any quali3cation, reservation or adverse remarks and forms part of the Annual Report. No frauds have been reported by the Statutory Auditors during the Financial Year 2025-2026 pursuant to the provisions of Section 143(12) of the Act.

Secretarial Auditor & Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors and the Members of the Company had appointed M/s. LABH & LABH Associates, Company Secretaries (Firm Registration No.: P2025WB105500) to undertake the Secretarial Audit of the Company for the Financial Year 2025-26 to 2029-30.

The Report of Secretarial Audit in form MR-3 in accordance to Section 204 of Companies Act, 2013 and Secretarial Compliance Report in accordance with Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the 3nancial year ended March 31, 2026 is annexed herewith and marked as Annexure A to this Report. There are no audit quali3cations, reservations or any adverse remark in the said Secretarial Audit Report.

Pursuant to Regulation 24A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the report of the Secretarial Auditor of Winnow Investments and Securities Private Limited, material subsidiary of the Company is annexed herewith marked as Annexure B to this report.

Cost Audit

In accordance with the provisions of Section 148 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014 the Company was required to appoint Cost Auditors to audit the cost records. The Board of Directors, on the recommendation of Audit Committee, have re-appointed M/s A. C. Dutta & Co, Cost Accountants (Registration No.000125) as the Cost Auditor for the 3nancial year 2026-2027. As required under the Act, a resolution seeking members approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their rati3cation.

The Cost records as speci3ed by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, are prepared, maintained and the same are audited by the Cost Auditor.The Cost Audit Report for the year 2025-2026 was 3led with the Ministry of Corporate A3airs.

Secretarial Standards

During the year under review, the Company has complied with all the applicable Secretarial Standards on Board Meetings and General Meetings issued by The Institute of Company Secretaries of India, as mandated under Section 118 of the Act.

Particulars of Loans, Guarantees or Investments by Company

The particulars of investments made and loan given by the Company under Section 186 of the Companies Act, 2013 are provided in note nos. 7 and 9 to the 3nancial statements.

Related Party Transactions

All Related Party Transactions that were entered into during the Financial Year under review were on an arms length basis, and in the ordinary course of business and are in compliance with the applicable provisions of the Act and the Listing Regulations. There were no materially signi3cant Related Party Transactions made by the Company during the year that required shareholders approval under Regulation 23 of the Listing Regulations. All Related Party Transactions are placed before the Audit Committee for prior approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature or when the need for these transactions cannot be foreseen in advance. None of the transactions entered into with Related Parties fall under the scope of Section 188(1) of the Act. Details of transactions with Related Parties as required under Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure - C in Form AOC - 2 and forms part of this Report. The Company has adopted a Policy for dealing with Related Party Transactions. The Policy as approved by the Board is available at the web link: https://www.kancotea.in/pdf/2021-2022/POLICY%20ON%20DEALING%20 WITH%20RELATED%20PARTY%20TRANSACTIONS%20AND%20MATERIALITY%20OF%20RELATED%20PARTY%20 TRANSACTIONS.pdf.

Material Changes and commitments occurred between the end of the Financial Year under Review and the date of this report.

No material changes and commitments have occurred between the end of the 3nancial year under review and the date of this report.

One-time settlement with Banks or lending institutions, if any

During the year under review, the Company has not entered into any one-time settlement with Banks or lending institutions.

Cases registered with NCLT under the provisions of insolvency and Bankruptcy Code, 2016, either by the Company or against the Company

During the year under review, no cases have been registered with NCLT under the provisions of Insolvency and Bankruptcy Code, 2016, either by the Company or against the Company.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement pursuant to Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 on conservation of energy, technology absorption, foreign exchange earnings and outgo is annexed herewith marked as Annexure D to this report.

Risk Management

As per requirement of Section 134(3) (n) of the Companies Act, 2013 the Board of Directors in its meeting held on 9th May, 2014 had approved the Risk Management Policy. The Board had in its policy had envisaged various elements of risks which may threaten the existence of the Company. Risk evaluation and management is an ongoing process within the Company. The Risk Management Policy is reviewed by the Board every year. The Risk Management Policy of the Company is available on the website of the Company at https://kancotea.in/pdf/2023-2024/Risk%20Manage-ment%20%20Policy.pdf.

Corporate Social Responsibility

The Company has a Policy on Corporate Social Responsibility and the same has been posted on the website of the Company at https://www.kancotea.in/pdf/2021-2022/CSR%20POLICY.pdf. The Annual Report on CSR activities in terms of the requirements of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - E, which forms part of this Report.

Subsidiaries, Joint Ventures and Associate Companies

As on 31st March, 2026, the company has one wholly owned material subsidiary namely Winnow Investments and Securities Private Limited. During the year, the Board of Directors reviewed the a3airs of the subsidiary. In accordance with Section 129(3) of the Companies Act, 2013, we have prepared the consolidated 3nancial statement of the company and its subsidiary, which forms part of the Annual Report. The revenue and total comprehensive income of the subsidiary for the 3nancial year ended 31st March, 2026 was Rs.62.45 Lakhs (P.Y Rs. 57.32 Lakhs) and Rs. 41.19 Lakhs (P.Y. Rs. 32.49 Lakhs) respectively. The total asset of the subsidiary as on 31st March, 2026 was Rs.2511.24 Lakhs (P.Y Rs. 2467.76 Lakhs). Further, a statement containing the salient features of the 3nancial statement of our subsidiary, in Form AOC-1, is annexed as Annexure - F, which forms part of this Report

Deposits

During the year under review, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014. Pursuant to Rule 2(c) (viii) of the Companies (Acceptance of Deposits) Rules, 2014, the Company has received money from its directors, the details of which are provided in the Financial Statement.

Material Orders Passed by the Regulators /Courts/ Tribunal

There are no signi3cant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

Changes in the nature of business

During the year under review, there was no change in the nature of the business of the Company.

Internal Controls

The Company has adopted and implemented robust policies and procedures for ensuring the orderly and e3cient conduct of its business The Audit Committee of the Board of Directors reviews the adequacy and e3ectiveness of the Internal Control System. The Companys internal Control System is commensurate with its size, scale and complexities of its operations and ensures safeguarding of its assets, compliance with the applicable laws, prevention and detection of fraud, accuracy and completeness of the accounting records, and timely preparation of reliable 3nancial disclosures.

Vigil Mechanism/ Whistle Blower policy

The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns and grievances. Protected disclosures can be made by a whistle blower through an email or dedicated telephone line or a letter to the Chairman of the Audit Committee. No complaint was received during the year nor was pending at the end of the year. The policy can be viewed at http://kancotea.in/pdf/Code%20of%20Conduct/VIGIL%20MECHANISM_WHISTLE%20 BLO ER%20POLICY.PDF.

Stock Exchange

At present, the Companys equity shares are listed at BSE Limited (Scrip Code- 541005) and the Calcutta Stock Exchange Limited (Scrip Code-14107) and Listing Fees for the 3nancial year 2026-2027 has been paid.

Management Discussion and Analysis

Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(3) read with Schedule V to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed herewith marked as Annexure G to this report.

Corporate Governance

The Report on Corporate Governance provisions in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed herewith marked as Annexure H to this report.

Transfer to Investor Education and Protection Fund

As per Sections 124 and 125 of the Act, read with the IEPF (Accounting, Audit, Transfer and Refund) Rules, 2016 (collectively referred to as "IEPF Rules"), any dividends or proceeds from the sale of fractional shares that remain unclaimed/unpaid for a period of seven years must be transferred to the IEPF. Additionally, shares with unclaimed dividends for seven consecutive years must be transferred to the Demat Account of the IEPF Authority, except when a court or statutory authority restrains transfer. During FY 2025-2026, the Company has transferred unclaimed dividends declared for FY 2017-18 and shares on which dividend(s) remained unclaimed from FY 2017-18 to FY 2024-25 to the IEPF. Information about the transferred dividends and shares is available on the Companys website at https:// www.kancotea.in/unclaimed_dividends.html. The Company sends reminders to shareholders periodically, urging them to claim their unclaimed dividends to avoid transfer to the IEPF Authority.

However, shareholders can claim back their shares and unclaimed dividends transferred to the IEPF by following the prescribed procedure under the IEPF Rules. The shareholder/claimant post obtaining Entitlement Letter from the Company must make an online application to the IEPF Authority in e-Form No. IEPF-5 (available at www.iepf.gov.in) and submit the necessary documents to the Company. The following table provides information about outstanding dividends/sale proceeds from fractional shares and their respective due dates for claiming it from the Company.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company upholds a zero-tolerance policy toward sexual harassment at the workplace and remains committed to providing a safe, respectful, and inclusive working environment for all employees. In line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the applicable rules, the Company has instituted a comprehensive framework for the prevention, prohibition, and redressal of sexual harassment. Policy on Prevention of Sexual Harassment can be accessed at https://www.kancotea.in/policies_codes.html

Number of complaints received and resolved in relation to Sexual Harassment of Women at Workplace (Prevention, Protection, and Redressal) Act, 2013 during the year under review and their breakup is as under:

No. of Complaints pending as on 1st April, 2025: Nil No. of Complaints received: Nil No. of Complaints Disposed o3: Nil No. of cases pending as on 31st March, 2026: Nil

Details pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended.

#Non-Executive /Independent Directors have been paid only sitting fees for meetings attended by them and hence the remuneration paid to them is not comparable to the median remuneration.

Note- Liability for gratuity and leave encashment as required by Indian Accounting Standard 19 (Ind AS-19) is provided on actuarial valuation report for the Company as a whole. The amount pertaining to individual employee is not ascertainable and therefore not included in the above calculation.

Particulars of Employees

The Company has no employee who were in receipt of remuneration of more than Rs.1.02 Crores per annum during the year ended 31st March, 2026 or of more than Rs. 8.50 Lakhs per month during any part thereof. The disclosures pertaining to remuneration and other particulars as prescribed under the provisions of Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are annexed herewith marked as Annexure I to this report.

Disclosure under the Maternity Bene3t Act,1961

The company has complied with the provisions relating to the Maternity Bene3ts Act, 1961

Acknowledgement

Your directors place on records their appreciation for the cooperation and support extended by the Employees, Banks/ Financial Institutions and all other business partners.