Karbonsteel Engineering Ltd Directors Report

Directors Report

To

The Members,

KARBONSTEEL ENGINEERING LIMITED

{CIN: L74120MH2011PLC216558}

B-8, Ratnadeep Cosmopolitan CHS LTD,

140-141 S.V. Road,

Nr. Shoppers Stop, Andheri (W),

Mumbai MH 400058 IN.

The Board of Directors ("Board") present this 15^th (Fifteenth) Annual Report of the company together with the audited financial statements for the financial year ended on March 31,2026.

Financial Highlights

The companys financial highlights for the year under review, along with previous years figures, are given hereunder:

Particulars	(Amount in Lakhs.)
	FY26	FY25
Revenue from operations	30,087.75	27,305.35
Other Income	81.7	85.47
Total Income	30,169.45	27,390.81
Less: Expenditure	28,715.07	25,479.72
Profit/(Loss) before Tax	1,454.38	1,911.10
Tax Expense
Current Tax	375.84	476.49
Deferred Tax	27.76	18.67
Profit/(Loss) after Tax	1,050.78	1,415.93
Earnings Per Share (F.V. Rs. 10 per Equity Share)	8.22	12.78

Operations and state of the affairs of the company

During the financial year ended on March 31, 2026, the Company achieved total income of Rs. 30,169.45 Lakhs as compared to total income of Rs. 27,390.81 Lakhs during the previous financial year. The profit before tax stood at Rs. 1,454.38 Lakhs against profit of Rs. 1,911.10 Lakhs in the previous year. The net profit stood at Rs. 1,050.78 Lakhs against profit of Rs. 1,415.93 Lakhs reported in the previous year.

Change in nature of business

There was no change in the nature of business during the financial year ended on March 31,2026 and the company has continued to carry on the existing business of the Company.

Dividend

The Board of Directors does not recommend dividend for the Financial Year ended on March 31, 2026. Transfer to reserves

The Board of Directors has decided to plough back the entire amount of profit in the business. Accordingly, the Company has not transferred any amount to the General Reserves for the financial year ended March 31,2026.

Human resource

The companys continued success depends on the ability to attract, develop and retain the best talent at every level. The Companys Human Resource (HR) Management practices are deep-rooted in ensuring a fair and reasonable process for all- round development of its talent. The Company strives to maintain a skilled and dedicated workforce, representing diverse experiences and viewpoints. The Companys HR Policy is focused on supporting employees well-being. The Company finds it imperative to follow policies and regulations that produce an unbiased work and safe work environment.

Subsidiary, associate and joint venture company

During the financial year ended on March 31, 2026, the Company has no subsidiary or associates or joint venture company. There are no companies which have become or ceased to be the Subsidiary or Associates or Joint Venture of the Company during the financial year ended on March 31, 2026.

Consolidated financial statement

Since the Company does not have any Subsidiary, Associate or Joint Venture Company as at March 31, 2026, the provisions relating to preparation and presentation of Consolidated Financial Statements under Section 129(3) of the Companies Act, 2013, read with the applicable Rules made thereunder, were not applicable to the Company during the financial year under review.

Deposits

The Company has not accepted any deposit falling under Chapter V of the Companies Act, 2013 ("The Act") during the financial year ended March 31, 2026 and There were no such deposits outstanding at the beginning and end during the financial year ended March 31,2026.

IPO Proceeds

The Company made an Initial Public Offering ("IPO") of 37,29,600 Equity Shares of face value of Rs. 10/- each at a premium of Rs. 149/- per Equity Share aggregating to Rs. 59.30 Crores. The IPO comprised of a Fresh Issue of 30,39,600 Equity Shares amounting to Rs. 48.33 Crores and an Offer for Sale of 6,90,000 Equity Shares by the Promoter Selling Shareholders. Consequently, the paid-up equity share capital increased from Rs. 11,10,22,220/- to Rs. 14,14,18,220/-.

The Equity Shares of the Company were listed on the SME Platform of BSE Limited on September 16 2025.

The Company has utilised the proceeds received from the Fresh Issue towards the objects stated in the Prospectus. The details of utilisation of IPO proceeds as on March 31, 2026 are as follows;

Sr. No. Particulars	Amount as per Prospectus (in Cr)	Amount Utilised up to March 31, 2026 (in Cr)	Unutilised Amount as on March 31, 2026 ( in Cr)
1 Funding of capital expenditure towards expansion of existing Umbergaon facility through construction of new sheds	12.29	7.38	4.91
2 Repayment of a portion of certain borrowings availed by our Company	3.08	3.03	0.05
3 To meet the Working Capital requirements	25.25	25.02	0.23
4 General Corporate Purpose	4.3	3.1	1.2

Pursuant to the applicable provisions of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, the Company has appointed CARE RATINGS LIMITED as a Monitoring Agency to monitor the utilisation of IPO proceeds. The Monitoring Agency Reports are submitted to the Stock Exchange(s) on a periodic basis and are available on the website of the Company.

Material changes affecting the financial position of the company

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year ended March 31, 2026 and date of this report.

Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future

During the financial year ended on March 31,2026, no significant and material orders have been passed by any Regulator or Court or tribunal which can have an impact on the going concern status and the Companys operations in the future.

Particulars of contracts or arrangements with related parties

All the transactions/contracts/arrangements of the nature as specified in Section 188(1) of the Companies Act, 2013 entered by the Company during the year under review with related party(ies) are in the ordinary course of business and on arms length basis. Hence, no particulars in form AOC-2 are furnished.

The details of related party transactions entered into by the Company during the financial year are disclosed in the notes forming part of the financial statements.

Particulars of loans, guarantees, investments under section 186

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to financial statements if any.

Share Capital

During the year under review, the Authorised Equity Share Capital as on March 31, 2026, stood at Rs. 15,00,00,000/- (Rupees Fifteen Crores only) comprising of 1,50,00,000 equity shares of Rs. 10/- each.

The paid-up equity share capital as on March 31, 2026, increased from Rs. 11,10,22,220/- to Rs. 14,14,18,220/- (Rupees Fourteen Crore Fourteen Lakhs Eighteen Thousand Two Hundred and Twenty only) comprising of 1,41,41,822 equity shares of Rs. 10/- each.

During the year under review, the Company successfully completed its Initial Public Offering ("IPO") on the SME Platform of BSE Limited. Pursuant to the Fresh Issue, the Company allotted 30,39,600 Equity Shares of Rs. 10/- each at an issue price of Rs. 159/- per Equity Share, including a premium of Rs. 149/- per Equity Share, aggregating to Rs. 48,32,96,400/-. The IPO also comprised an Offer for Sale of 6,90,000 Equity Shares by the existing Selling Shareholders. The Equity Shares allotted pursuant to the Fresh Issue were duly listed on the SME Platform of BSE Limited.

Disclosure relating to equity shares with differential rights

During the financial year ended March 31, 2026, the Company has not issued any equity shares with differential rights and hence reporting requirement, as mentioned in Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 are not applicable.

Disclosure relating to sweat equity share

During the financial year ended March 31, 2026, the Company has not issued any sweat equity shares and hence reporting requirement as mentioned in Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 are not applicable.

Disclosure relating to employee stock option scheme and employee stock purchase scheme

During the financial year ended March 31, 2026, the Company does not have any Employee Stock Option Scheme or Employee Stock Purchase Scheme. Hence reporting requirements as mentioned in Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 are not applicable.

Disclosure relating to employee stock option scheme and employee stock purchase scheme

During the financial year ended March 31, 2026, there are no shares held by trustees for the benefit of employees and hence no disclosure has been made under Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014.

Web link for annual return

The Copy of Annual Return as required under section 92 of the Companies Act, 2013 read with the rule 12 of the Companies (Management and Administration) Rules, 2014 will be available on the website of the Company www.karbonsteel.com at the link https://karbonsteel.com/disclosures-as-per-regulation-46-of-the-sebi-lodr regulations/#annual-return after filing annual return, on completion of ensuing annual general meeting with the Registrar of Companies within the time stipulated in said section 92 of Act.

Board of directors and key managerial personnel

• In terms of the provision of section 152 of the Companies Act, 2013 and of Articles of Association of the Company, Mr. Shrenik Kirit Shah (DIN: 02070901), Managing Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. The re-appointment is being placed for your approval at the AGM.

• All Independent Directors have furnished the declarations to the Company confirming that they meet the criteria of Independence as prescribed under Section 149 of the Act and Regulation 16 (1)(b) read with Regulation 25(8) of the SEBI Listing Regulations and the Board has taken on record the said declarations after undertaking due assessment of the veracity of the same.

• The Company has also received Form DIR-8 from all the Directors pursuant to Section 164(2) and Rule 14(1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

• During the financial year 2025-26, there were no changes in Director of the Company. However, following changes took place in the Key managerial Personnel during the year;

a. Ms. Jankhana Vasanji Gala resigned from the position of Company Secretary and Compliance Officer of the Company w.e.f. June 30, 2025.

b. Ms. Siddhi Bharatbhai Parmar was appointed as Company Secretary and Compliance Officer of the Company w.e.f. July 01,2025.

• Further, none of the Directors are disqualified for being appointed as the Director of the Company in terms of section 164 of the Companies Act, 2013

Board of Directors and Committee thereof

i. Composition of the Board of Directors:

The composition of the Board of Directors ("the Board") is in compliance with the applicable provisions of the Companies Act, 2013. The Board of the Company is composed of individuals from diverse fields. The Board of the Company is composed of Executive, Non-Executive and Independent Directors. The composition of the Board complies with the provisions of the Companies Act, 2013.

As on March 31, 2026, the strength of the Board of Directors of the Company comprised Five Directors comprising of Two Executive, One Non-Executive Director and Two Non-Executive Independent Directors. The details of the Board of Directors as on March 31,2026 are given below:

Name of the Director	Designation	Date of Joining
Mr. Shrenik Kirit Shah	Managing Director	25/04/2011
Mr. Mittal Shrenik Shah	Whole-time director	25/08/2022
Mr. Saurabh Bhansali	Non-Executive Director	01/07/2024
Mr. Mihen Jyotindra Halani	Non-Executive, Independent Director	25/06/2024
Mr. Sunil Kathariya	Non-Executive, Independent Director	01/05/2024

ii. Board Meetings:

The Board of Directors of the Company duly met 13 (Thirteen) times as follows;

Sr. No.	Date of Meeting	No. of Directors eligible to attend meeting	No. of Directors Attended meeting
1	04.04.2025	5	5
2	29.04.2025	5	2
3	27.05.2025	5	2
4	30.05.2025	5	2
5	01.07.2025	5	3
6	02.08.2025	5	3
7	14.08.2025	5	5
8	29.08.2025	5	4
9	04.09.2025	5	2
10	12.09.2025	5	2
11	12.09.2025	5	3
12	13.11.2025	5	5
13	09.03.2026	5	5

The gap between two Board meetings was in compliance with the provisions of the Act. Details of Directors as on March 31, 2026 and their attendance at the Board meetings and Annual General Meeting ("AGM") during the financial year ended March 31,2026 are given below:

Name of the Director	Category	No. of the Meeting eligible to attend	No. of the Meeting attended	Attended at AGM
Mr. Shrenik Kirit Shah	Managing Director	13	13	Yes
Mr. Mittal Shrenik Shah	Whole-time director	13	13	Yes
Mr. Saurabh Bhansali	Non-Executive Director	13	6	Yes
Mr. Mihen Jyotindra Halani	Non-Executive, Independent Director	13	6	Yes
Mr. Sunil Kathariya	Non-Executive, Independent Director	13	5	Yes

iii. Audit Committee:

The Audit Committee is duly constituted in accordance with the Section 177 of the Companies Act, 2013 and Rule 6 of the Companies (Meeting of board and its power) Rules, 2014. It adheres to the terms of reference which is prepared in compliance with Section 177 of the Companies Act, 2013.

The members of the Audit Committee of the Company as on March 31,2026 are as under:

Name of the Director	Status in Committee	Nature of Directorship
Mihen Halani	Chairman	Independent Director
Sunil Kathariya	Member	Independent Director
Shrenik Kirit Shah	Member	Managing Director

The Audit Committee Meetings were duly convened during the financial year ended March 31, 2026 on following dates:

Sr.No.	Date of Meeting	No. of Directors eligible to attend meeting	No. of Directors Attended meeting
1	04-04-2025	3	3
2	01-07-2025	3	3
3	14-08-2025	3	3
4	04-09-2025	3	3
5	13-11-2025	3	3

iv. Nomination and Remuneration Committee:

The Nomination and Remuneration Committee is constituted in accordance with the Section 178 of the Companies Act, 2013 read with Rule 6 of the Companies (Meeting of board and its power) Rules, 2014.

The members of the Nomination and Remuneration Committee of the Company as on March, 31, 2026 are as under:

Name of the Director	Status in Committee	Nature of Directorship
Mihen Jyotindra Halani	Chairman	Independent Director
Sunil Kathariya	Member	Independent Director
Saurabh Bhansali	Member	Non-Executive Director

The Nomination and Remuneration Committee Meetings were duly convened during the financial year ended March 31,2026 on following dates:

Sr.No.	Date of Meeting	No. of Directors eligible to attend meeting	No. of Directors Attended meeting
1	04-04-2025	3	3
2	01-07-2025	3	3

v. Stakeholders Relationship Committee

The Stakeholders Relationship Committee in terms of the provisions of section 178 of the Companies Act, 2013 and SEBI (LODR) Regulations 2015, comprising following members as on March 31,2026; .

Name of the Director	Status in Committee	Nature of Directorship
Mihen Jyotindra Halani	Chairman	Independent Director
Sunil Kathariya	Member	Independent Director
Saurabh Bhansali	Member	Non- Executive Director

During the financial year ended March 31, 2026, no investor complaints were received and hence no meeting was required to be convened.

vi. Corporate Social Responsibility (CSR) committee

The Company is required to spend towards corporate social responsibility under section 135 of the Companies Act, 2013. The details of amount spent towards Corporate Social Responsibility during the financial year ended March 31,2026, is given in ANNEXURE A.

The Corporate Social Responsibility Committee comprises following members as on March 31,2026;

Name of the Director	Status in Committee	Nature of Directorship
Sunil Kathariya	Chairman	Independent Director
Saurabh Bhansali	Member	Non-Executive Director
Shrenik Kirit Shah	Member	Managing Director

The CSR Committee Meetings were duly convened during the financial year ended March 31, 2026 on following day:

Sr.No.	Date of Meeting	No. of Directors eligible to attend meeting	No. of Directors Attended meeting
1	12-09-2025	3	3

Directors Responsibility Statement

In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited financial statements of the Company for the financial year ended March 31,2026; the Board of Directors hereby confirms that:

a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. such accounting policies have been selected and applied consistently and the Directors made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2026 and of the profit of the Company for the year ended on that date;

c. proper and sufficient care was 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;

d. the annual accounts of the Company have been prepared on a going concern basis;

e. the Director have laid down internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

f. proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Corporate Governance Report

The Equity Shares of the Company were listed on the SME Platform of BSE Limited with effect from September 16, 2025. Pursuant to the provisions of Regulation 15 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the compliance with the corporate governance provisions as specified in regulations 17 to 27 (except regulation 23) and clause (b) to (i) of sub-regulation (2) of regulation 46 and Para C, D and E of schedule V are not applicable to the Company being SME Listed Company.

The Company has obtained a certificate from the Practicing Company Secretary (PCS) confirming the non-applicability of Corporate Governance provisions to the Company for the financial year ended March 31,2026.

Declaration By Independent Directors

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the rules made there under.

All the Independent Directors of the Company have registered themselves with the Indian Institute of Corporate Affairs ("IICA"). Further, as per the declarations received, all the Independent Directors of the Company have either passed or were exempted to clear online proficiency test as per the first proviso to Rule 6(4) of the MCA Notification dated October 22, 2019 and December 18, 2020.

Policy On Remuneration Of Directors

The Company follows a policy on remuneration of Directors, Key Managerial Personnel (KMP), Senior Management Personnel (SMP) and other employees of the Company. The policy is approved by the

Nomination & Remuneration Committee of the Company and has been uploaded on the Companys website and can be accessed at the https://www.karbonsteel.com/corporate-governance/

The Company with the approval of Nomination & Remuneration Committee has adopted a policy on Board diversity and the recommendation of candidature for Board appointment will be based on merit that complements and expands the skills, experience and expertise of the Board as a whole, taking into account gender, age, professional experience and qualifications, cultural and educational background, and any other factors that the Board might consider relevant and applicable from time to time towards achieving a diverse Board.

Performance Evaluation Of Board, Committees And Directors

In compliance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, the Board of Directors has carried out an Annual Evaluation of its own performance, Board Committees, Individual Directors, Chairperson and the CEO/ Managing Director etc., for the financial year ended March 31, 2026.

Code of Conduct

The Company has adopted a code of conduct for its directors and designated senior management personnel. All the Board members and senior management personnel have agreed to follow compliance of code of conduct.

Whistle Blower Policy/Vigil Mechanism Policy

Pursuant to the provisions of Section 177 of the Act, the Company has adopted a Vigil Mechanism/Whistle Blower Policy to provide a platform to the Directors and Employees of the Company to raise concerns regarding any irregularity, misconduct or unethical matters/dealings within the Company.

The said Policy is available on the Company website and can be accessed by web link https://www.karbonsteel.com/wp-content/uploads/2025/09/Whistle-Blower-Vigil-Mechanism-Policv.pdf

During the financial year ended March 31, 2026, no complaint was received under the Vigil Mechanism/ Whistle Blower Policy of the Company.

Familiarization Program Of Independent Directors

The Company has put in place a familiarization program for Independent Directors to familiarize them with their role, rights and responsibility as Directors, the operations of the Company, business overview etc.

The details of the familiarization program is also available on the website of the Company and can be accessed by weblink https://www.karbonsteel.com/corporate-governance/

Internal Control Systems And Their Adequacy

The Company has an adequate system of internal control to ensure that the resources are used efficiently and effectively so that:

• assets are safeguarded and protected against loss from unauthorized use or disposition.

• all significant transactions are authorized, recorded and reported correctly.

• financial and other data are reliable for preparing financial information.

• other data are appropriate for maintaining accountability of assets.

The internal control is supplemented by an extensive internal audits programme, review by management along with documented policies, guidelines and procedures.

Risk Management

During the financial year ended March 31, 2026, the Company has identified and evaluated elements of business risk. Consequently, a Business Risk Management framework is in place. The risk management framework defines the risk management approach of the Company and includes periodic review of such risks and also documentation, mitigating controls and reporting mechanisms of such risks. The framework has different risk models which help in identifying risks trend, exposure and potential impact analysis at a Company level as also separately for business.

Disclosure Under The Sexual Harassment Of Women At Workplace (Prevention, Prohibition And Redressal) Act, 2013

The Company has in place prevention of Sexual Harassment at workplace policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee has been set up to redress complaints received regularly.

During the financial year ended March 31, 2026, the disclosure as required under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is given below:

Number of complaints filed during the financial year : Nil Number of complaints disposed of during the financial year: Nil Number of complaints pending as on end of the financial year: Nil

The Code On Social Security, 2020 - Maternity Benefit

The Company affirms that it has duly complied with all provisions of the Maternity Benefit Act, 1961, and has extended all statutory benefits to eligible women employees during the financial year ended March 31, 2026.

Remuneration Of Directors And Particulars Of Employees:

Further, particulars of employee remuneration as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. Having regard to the second proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the said information is being sent to the members of the Company. The said information is available for inspection and any member interested in obtaining such information may write to the Company Secretary.

Auditors Report

During the financial year ended March 31, 2026, the Notes to the financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. There are no qualifications or adverse remarks in the Auditors Report which require any clarification or explanation. Further, the Directors of the Company confirm that during the year under review, no instances of fraud were reported by

the Auditors under Section 143(12) of the Companies Act, 2013 and the Rules made thereunder either to the Company or to the Central Government.

Statutory Auditor

As per the provisions of section 139 of the Companies Act, 2013 M/s. Rao & Shyam, Chartered Accountants, (ICAI Firm Registration No. 006186S), auditors of the Company were appointed for term of five years. They hold the office from the conclusion of the 13^th Annual General Meeting till the conclusion of the Annual General Meeting of the Company to be held in the financial year 2029-30 and on such terms and remuneration as may be mutually agreed upon between the said Auditors and Board of Directors of the Company.

Cost Auditor

M/s. Mayur Chhaganbhai Undhad & Co., Cost Accountants (FRN 103961) were appointed by the Board of Directors at its Meeting held on August 14, 2025, as the Cost Auditors of the Company for the Financial Year 2025-26, for all the applicable products, pursuant to the provisions of Section 148 of the Companies Act, 2013 and the Companies (Cost Records and Audit) Rules, 2014.

The Company has prepared and maintained cost accounts and records for the Financial Year 2025-26, as per sub-section (1) of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014.

The Cost Audit Report for the Financial Year 2025-26 has been received by the Company from the Cost Auditor. The said report does not contain any qualification, reservation, adverse remark or disclaimer requiring any explanation or comments from the Board of Directors pursuant to the provisions of Section 134(3)(f) of the Companies Act, 2013.

Internal Auditor

During the financial year ended March 31, 2026, the Company had appointed M/s. Desai Bhansali & Associates LLP (Firm Registration No. W100190/Membership No. 139874) on 12th September, 2025, who were appointed as the Internal Auditor of the Company for the Financial year 2025-26, have tendered their resignation due to pre-occupation in other activities vide letter dated 6th November, 2025, effective from 12th November, 2025.

Further, M/s. Chintan D Shah & Associates, Chartered Accountant, (Firm Registration No-146176W) based on the recommendation of the Audit Committee, were appointed by the Board of Directors at its Meeting held on November 13, 2025, as the Internal Auditors of the Company for the Financial Year 2025-26, pursuant to the provisions of Section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

The Internal Auditor submitted periodic reports to the Audit Committee and the Board.

Secretarial Auditor

Ms. Amita Karia, Practising Company Secretary, (holding CP No. 16962) were appointed by the Board of Directors at its Meeting held on November 13, 2025, as the Secretarial Auditors of the Company for the Financial Year 2025-26, pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The Secretarial audit report in form MR-3 for the financial year 2025-26 is attached here as ANNEXURE B.

The Board has taken note of the observation and has advised that necessary measures be undertaken to strengthen the internal compliance framework and controls to ensure timely and proper compliance with all applicable statutory filing requirements in future.

During the year under review, the Secretarial Auditor has not reported any fraud under Section 143(12) of the Act.

Management Discussion and Analysis Report

The Management Discussion and Analysis Report as stipulated in Regulation 34 (2) (e) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 has been annexed to Boards report herewith ANNEXURE C.

Compliance of Secretarial Standards

During the financial year ended March 31, 2026, the Company has complied with the applicable SS-1 (Secretarial Standard on Meetings of the Board of Directors) and SS-2 (Secretarial Standard on General Meetings) issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.

Internal Financial Control And Their Adequacy

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information. The Company has adopted accounting policies, which are in line with the Accounting Standards and the Act.

Transfer of Unclaimed Dividend and Equity Shares to Investor Education and Protection Fund (IEPF)

During the financial year ended March 31, 2026, no unclaimed or unpaid dividend amounts or corresponding equity shares were required to be transferred to the Investor Education and Protection Fund (IEPF) pursuant to the provisions of the IEPF Rules.

Details of proceedings under the Insolvency and Bankruptcy Code, 2016

1. During the financial year ended March 31, 2026, no application was made and no proceedings were pending against the company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016).

2. During the financial year ended March 31, 2026, there was no One Time settlement with any bank or Financial Institution.

Environment and Safety

The Company is conscious of the importance of environmentally clean and safe operations. The Companys policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances environmental regulations and preservation of natural resources.

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

Pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, the following particulars are provided:

A. Conservation of Energy

The Company is engaged in structural engineering and fabrication of heavy and precision steel structures. The Company continuously endeavours to conserve energy and improve energy efficiency in its manufacturing and fabrication operations.

During the financial year ended March 31,2026, the Company has taken measures for efficient utilisation of energy through optimum utilisation of plant and machinery, regular maintenance of equipment and machinery, optimisation of manufacturing processes and prevention of avoidable energy consumption.

Steps taken for utilisation of alternate sources of energy:

The Company has proposed to install a solar power system at its factory premises, which is expected to contribute towards increased utilisation of renewable energy and reduction in conventional energy consumption.

Capital investment on energy conservation equipment:

During the financial year ended March 31, 2026, the Company has not made any material capital investment specifically towards energy conservation equipment.

B. Technology Absorption

The Company continues to adopt and utilise modern and appropriate technology in its structural engineering and fabrication operations with a view to improving productivity, precision, quality and operational efficiency.

During the year under review, the Company continued to utilise technology-enabled manufacturing and fabrication equipment, including CNC-based cutting and drilling equipment and automated /advanced welding equipment, as part of its manufacturing processes. The adoption and utilisation of such technology has contributed to improved accuracy and precision, enhanced productivity, better quality of fabrication, reduction in material wastage and efficient utilisation of resources.

Benefits derived from technology absorption:

The Company has derived benefits in terms of improved productivity, precision, quality, operational efficiency and better utilisation of materials and resources.

Imported Technology:

During the financial year ended March 31,2026, the Company has not imported any technology requiring disclosure under Rule 8(3)(b) of the Companies (Accounts) Rules, 2014.

Research and Development:

The Company does not have a separate Research and Development facility. However, continuous improvement and optimisation of manufacturing and fabrication processes are undertaken as part of the Companys regular operations.

C. Foreign Exchange Earnings and Outgo

The details of foreign exchange earnings and outgo during the period under review are as follows:

Earnings in Foreign Exchange: Nil Expenditure in Foreign Currency: Nil

Listing with Stock Exchanges

The equity shares of Karbonsteel Engineering Ltd (Scrip Code: 544511) are listed and admitted to dealings on the BSE Limited (SME Platform) with effect from September 16, 2025. has been filed.

Acknowledgements and Appreciation

Your directors take this opportunity to thank the business partners/associates and various regulatory authorities for their consistent support/ encouragement to the Company.

Your directors would also like to thank the Members for reposing their confidence and faith in the Company and its Management.

For and on behalf of the Board of

KARBONSTEEL ENGINEERING LIMITED

Shrenik Kirit Shah

Chairman & Managing Director

DIN: 02070901

Place: Mumbai

Date: August 26, 2026.