Leapfrog Engineering Services Ltd Directors Report

IX. Performance Evaluaton of the Board:

In line with the policy on Board evaluaton and pursuant to the provisions of the Companies Act, the annual performance evaluaton was carried out for the financial year 2025-26 by the Nominaton and Remuneraton Committee in respect of Board performance, the Directors individually as well as the evaluaIon of the working of Committees of Board. A structured questonnaire covering various aspects of the Boards functoning was circulated to the Directors. The criteria for evaluaton of Independent Directors included attendance at the meetngs, interpersonal skills, independent judgement, knowledge, contributon to strategy, risk management, compliance framework, etc. The Directors have expressed their satsfacton with the evaluaton process.

X. Companys Policy on Directors Appointment and Remuneration:

13.Committees of the Board:

In compliance with the provisions of the Companies Act, 2013 and the SEBI (Listng Obligatons and Disclosure Requirements) Regulatons, 2015, the Board has consttuted a set of committees with specific terms of reference and scope to deal with specified matters. All the recommendatons made by the Committees of the Board, which were mandatorily required to be considered, were duly accepted by the Board.

Presently, the Board has consttuted following committees:

1. Audit Committee

2. Nominaton and Remuneraton Committee

3. Stakeholders Relatonship Committee

4. Risk Management Committee

5. Corporate Social Responsibility Committee

6. Borrowing and Investment Committee.

1. Audit Committee:

The company has complied with the requirements of Secton 177 of the Companies Act, 2013 and Regulaton 18 of SEBI (Listng Obligatons and Disclosure Requirements) Regulatons, 2015, relatng to the compositon of the Audit Committee. The scope, functons and the terms of reference of Audit Committee are in accordance with Secton 177 of the Companies Act, 2013, and the Rules made thereunder and Regulaton 18 of SEBI LODR Regulatons.

During the financial year, the Audit Committee has met 6 (Six) tmes as under:

The compositon of the Audit Committee and the attendance details of each Member of the Audit Committee are as follows:

2. Nomination and Remuneration Committee:

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has constituted the Nomination and Remuneration Committee. The scope, functions and the terms of reference of Nomination and Remuneration Committee are in accordance with Section 178 of the Companies Act, 2013, the Rules made thereunder and Regulation 19 of SEBI LODR Regulations.

During the year the Nomination and Remuneration Committee has met three (3) times as under:

The composition of the Nomination and Remuneration Committee and attendance details of each Member of the Nomination and Remuneration Committee are as follows:

3. Stakeholders Relationship Committee:

The Stakeholders Relationship Committee of the company is formed in compliance with the provisions of Section 178(5) of the Companies Act, 2013 and Regulation 20 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The scope, functions and the terms of reference of Stakeholders Relationship Committee are in accordance with Section 178 (5) of the Companies Act, 2013, the Rules made thereunder and Regulation 20 of SEBI LODR Regulations.

During the year, one (1) meeting of the Stakeholders Relationship Committee was held on March 26, 2026.

The composition of the Stakeholders Relationship Committee and attendance details of each Member of the Committee are as follows:

(i) Investor Grievance Redressal:

During the financial year under review, the company did not receive any complaints from its investors. Accordingly, no investor complaints were pending or remained unresolved as at the end of the financial year.

4. Risk Management Committee:

The company has constituted the Risk Management Committee in line with Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The scope, functions, and the terms of reference of the Risk Management Committee are in accordance with Regulation 21 of SEBI LODR Regulations 2015.

During the year, two (2) meetings of the Risk Management Committee were held on September 10, 2025 and March 26, 2026.

The Composition of the Risk Management Committee as on March 31, 2026 and attendance details of each Member of the Committee are as follows:

(i) Risk Management Framework:

The Risk Management Committee facilitates the execution of risk management practices in the company, in the areas of risk identification, assessment, monitoring, mitigation and reporting and also provide guidance to the management team. The company has laid down procedures to inform the Audit

Committee as well as the Board of Directors about risk assessment and related procedures & status.

5. Corporate Social Responsibility (CSR) Committee:

In compliance with the provisions of Section 135 of the Companies Act, 2013, the company has constituted a Corporate Social Responsibility Committee. The scope, functions, and the terms of reference of the Corporate Social Responsibility (CSR) Committee are in accordance with the provisions of Section 135 of the Companies Act, 2013 read with the Rules framed thereunder.

During the year under review, 1 (One) meeting of the CSR Committee was held on August 28, 2025.

The Composition of the CSR Committee as on March 31, 2026 and attendance details of each Member of the Committee are as follows:

(i) Corporate Social Responsibility Policy:

17.Auditors & Audit Report:

I. Appointment of Statutory Auditors:

M/s GRSM & Associates, Chartered Accountants, Bengaluru (Firm Registration No. 000863S) have been appointed as the Auditors of the company by the Shareholders at Extra-ordinary General Meetng held on 9^th October 2025, to hold office up to the conclusion of the 21^st Annual General Meetng of the company in view of resignaton of Rao Associates, Chartered Accountants, Bengaluru.

M/s. GRSM & Associates, Chartered Accountants, Bengaluru (Firm Registraton No. 000863S), being eligible for appointment as the Statutory Auditors of the company, have provided their written consent for appointment as the Statutory Auditors for a consecutve term of five years, commencing from the conclusion of the 21st Annual General Meetng of the company. The Auditors have also confirmed that their appointment, if made, would be in accordance with the provisions of Sectons 139 and 141 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014.

II. Auditors Report:

There are no qualificatons, Observatons or adverse remarks in the Statutory Auditors Report which require any comments / explanaton from the Board of Directors.

III. Reporting of frauds by the auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government:

During the year under review, the Auditors of the company, M/s GRSM & Associates, Chartered Accountants, have not reported any instances of fraud committed in the company by its officers or employees, to the Board of Directors under Secton 143(12) of the Companies Act,2013.

18.Secretarial Auditor & Secretarial Audit Report:

The provisions of Secton 204 of the Companies Act, 2013 was not applicable to the company for the financial year 2025-26, However, as a measure towards strengthening good corporate governance practces and ensuring greater transparency and compliance, the company has voluntarily appointed a Secretarial Auditor to conduct a Secretarial Audit of the company.

The Board of Directors had appointed Mr. Sudhir Vishnupant Hulyalkar, Practcing Company Secretary, bearing Certificate of Practce Number 6137 as the Secretarial Auditor of the company for the financial year 2025-26. The Secretarial Audit Report issued by CS Sudhir Vishnupant Hulyalkar is provided in Annexure III in Form MR -3. There are no qualificatons or adverse remarks or disclaimers in the Secretarial Audit Report which require any comments / explanaton from the Board of Directors.

19.Internal Auditor:

As recommended by the Audit Committee, the Board of Directors of the company, in consultaton with the Internal Auditors formulated the scope, functoning, periodicity and methodology for conductng Internal Audit for the financial year 2025-26.

During the year under review, the company had appointed M/s. Shashi Santosh & Associates, Chartered Accountants, Bengaluru (Firm Registraton No. 016825S), as the Internal Auditor of the company for the Financial Year 2025-26. The said Internal Auditor tendered their resignaton from the positon of Internal Auditor of the company with effect from January 15, 2026 due to other professional commitments.

Consequent to the casual vacancy arising due to such resignaton, the Board of Directors appointed M/s. Dattatraya & Co., Chartered Accountants, Bengaluru, as the Internal Auditor of the company to conduct the Internal Audit for the third and fourth quarters of the Financial Year 2025-26, in accordance with the applicable provisions of the Companies Act, 2013.

20. Disclosure regarding maintenance of Cost Records as required under Sub-Section (1) of Section 148 of The Companies Act, 2013:

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable to the company.

21. Corporate Governance:

As per RegulaIon 15 (2) of the Securites and Exchange Board of India (LisIng ObligaIons and Disclosure Requirements) RegulaIons, 2015, the provisions relatng to Corporate Governance as prescribed under RegulaIons 17, 17A, 18, 19, 20, 21, 22, 24, 24A, 25, 26, 26A, 27 and clauses (b) to (i) and (t) of sub-regulton (2) of regulaIon 46 and para C, D, E of Schedule V are not applicable to the company, as the company is listed on the SME Platform of BSE Limited.

Accordingly, the disclosures required to be made in the Corporate Governance Report forming part of the Annual Report, as specified under Para C of Schedule V of the said RegulaIons, are not applicable to the company.

22. Management Discussion and Analysis Report:

Pursuant to RegulaIon 34 and Schedule V of the SEBI (LisIng ObligaIons and Disclosure Requirements) RegulaIons, 2015, a separate secton on the Management Discussion and Analysis Report is annexed to this Directors Report.

23. Corporate Policies:

24. ParEculars of Loans, Guarantees or Investments made under Secton 186 of The Companies Act, 2013:

During the year under review, the company has not provided any loans, guarantees to any company/body corporate and has not made any investments under Secton 186 of the Companies Act, 2013.

25. Insurance:

The company has taken adequate insurance cover of all its movable & immovable assets to cover various types of risks.

26. Deposits:

The company has neither accepted nor renewed any deposits from the public within the meaning of Secton 73 and 74 of the Companies Act, 2013 (the "Act") read with the Companies (Acceptance of Deposit) Rules, 2014, during the year under review. As such, no amount of principal or interest was outstanding as on the date of this report.

The partculars required to be reported under Chapter V of the Companies Act, 2013 are Nil as under:

27. Annual Return:

28. Vigil Mechanism / Whistle Blower Mechanism:

The company has established a Vigil Mechanism in compliance with the provisions of Section 177 (9) of the Companies Act, 2013 and Pursuant to Regulation No. 22 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, for directors and employees to report concerns about unethical behavior and actual or suspected fraud. It also provides for adequate safeguards against victimization of employees who avail the mechanism and allows direct access to the Chairman of the Audit Committee.

During the year under review, the company did not receive any complaints relating to unethical behaviour, actual or suspected fraud, or violation of the companys Code of Conduct from any employee and Directors.

29. Remuneration details of Directors, Key Managerial Personnel and Employees:

The details of the ratio of the remuneration of each Director to the median employees remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as follows:

(A) Disclosure under Section 197(12) and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

1. Rato of remuneration of each director to the median remuneration of the employees and percentage increase in remuneration of each director, CFO, CEO, CS in the Financial Year 2025-26 are as under.

2. The median remuneration of employees during the financial year was ^ 6,98,196 (Rupees Six Lakhs Ninety Eight Thousand One Hundred and Ninety Six) Only.

3. The percentage increase in the median remuneration of employees in the Financial Year 2025-26 was 18.70 % .

4. The number of permanent employees on the rolls of the company as on March 31, 2026, was 111 (One Hundred and Eleven) Only.

5. The average increase in median remuneration during the financial year 2025-26 was 18.70%. During the same period, the Profit after Tax has increased to ^ 1958.49 Lakhs for the Financial Year 2025-26 as compared to the Profit after Tax of ^ 1622.44 in the immediate previous financial year 2024-25.

6. Average percentile increase in the salaries of employees other than the managerial personnel during 2025-26 was 74.91%. The increase in the salaries of employees other than managerial personnel during the year was primarily attributable to the addition of manpower to support the Companys growing business operations and increased workforce requirements.

7. The percentile increase in managerial remuneration during the financial year 2025-26 was 34.80 %. The percentile increase in managerial remuneration was on account of the fixed and variable component of remuneration payable to the managerial personnel as per the terms and conditions of their appointment.

8. The key parameters for any variable component of remuneration availed by the directors: The Wholetime Directors are entitled to receive a fixed salary comprising of basic salary, allowances and perquisites.

9. The remuneration is as per the Nomination and Remuneration Policy formulated by the Nomination and Remuneration Committee and approved by the Board of Directors of the company.

(B) The names of the top ten employees in terms of remuneration drawn and the name of every employee

details, as per Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)

Rules 2014 - Not Applicable.

(C) Pursuant to provisions of Section 197(14) of Companies Act 2013, none of the directors are in receipt of commission from the company. And disclosures pertaining to details of receipt of any remuneration or commission from holding / subsidiary company by Managing Director or Whole Time Directors of the company are not applicable.

30.Loans from Directors and Relatives of Directors as required under the Companies (Acceptance of Deposit) Rules, 2014:

During the year under review, the company has not accepted any unsecured loans from its Directors or their relatives.

31.ConservaEon of Energy, Technology AbsorpEon, Foreign Exchange Earnings and Outgo as required under The Companies (Accounts) Rules, 2014 are furnished as under:

In In accordance with the requirements of Sub-section (3) Sub-clause (m) of section 134 of the Companies Act, 2013, read with Companies (Accounts) Rules, 2014, particulars with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

(I) ConservaEon of Energy:

(II) Technology AbsorpEon:

The company has developed inhouse energy and power manegement software tools which will help the company with real Eme data and analyEcs.

(III) Foreign Exchange Earnings and Outgo:

The Foreign Exchange outgo and foreign exchange earned by the company during the financial year 1st April 2025 to 31st March 2026 are as follows:

32. Internal Financial Controls:

Internal financial controls are an integral part of the risk management process of the company. The company has duly established and maintained its internal controls and procedures with reference to the Financial Statements and have also evaluated its effectiveness.

Assurance on the effectiveness of the internal financial control is obtained through management reviews, continuous monitoring by functional heads as well as testing of the internal financial control systems by the internal auditors and statutory auditors during their course of audit. The company believes that these systems provide reasonable assurance that the companys internal financial controls are designed effectively and are operating as intended.

33. Disclosure under SecEon 67 (3) of The Companies Act, 2013:

The disclosure requirements under section 67(3)(c) of the Companies Act, 2013 read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 are not applicable. As there are no voting rights that are not exercised directly by the employees, in respect of the shares to which the Scheme relates.

34. Disclosure under The Sexual Harassment of Women at Workplace (PrevenEon, ProhibiEon and Redressal) Act, 2013:

Your company has always believed in providing a safe and harassment free workplace for every individual working in the companys premises through various intervenEons and pracEces. The company always endeavors to create and provide an environment that is free from discriminaEon and harassment including sexual harassment.

The company has complied with provisions relaEng to the consEtuEon of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (PrevenEon, ProhibiEon and Redressal) Act, 2013. The ComposiEon of the Internal Complaints Committee is as follows.

The summary of the complaints received, resolved and pending for redressal during the Finanial Year 202526 are as under:

35. Compliance with the provisions relaEng to The Maternity Benefits Act, 1961:

The company affirms its compliance with the provisions of the Maternity Benefit Act, 1961, as amended from Eme to Eme.

36. Significant and Material Orders passed by Regulators / Courts/ Tribunals impacEng Going Concern status and the companys operaEons in future:

No orders have been passed by any regulators, courts or tribunal which impact the going concern status or which impairs the companys operaEons in future.

37. The Details of ApplicaEon made or any proceeding pending under The Insolvency and Bankruptcy Code, 2016 (31 Of 2016) during the year along with their status as at the end of the financial year:

The company has not made any applicaEon, nor any proceedings are pending under the Insolvency and Bankruptcy Code 2016 as at the end of the financial year 31st March 2026.

38. The Details of difference between amount of the valuaEon done at the Eme of One-Time Settlement and the valuaEon done while taking Loan from the Banks or Financial InsEtuEons along with the reasons thereof:

The company has not availed of One Time Settlement from Banks or Financial Institutions hence, there is nothing to report in this regard.

39. Human Resources (HR):

Human Resources (HR) Employee relations continue to be cordial at all levels and in all divisions of the company. The Board of Directors would like to express its sincere appreciation to all the employees for their continued hard work and steadfast dedication.

As on March 31, 2026, the company had an organizational strength of 111 permanenet employees.

Male: 83 Female : 28 Trangender : Nil

40. Disclosures with respect to demat suspense account/ unclaimed suspense account:

Disclosures with respect to demat suspense account/ unclaimed suspense account, as prescribed under Schedule V part F of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable to the Company, as there were no shares lying in the Demat Suspense Account / Unclaimed Suspense Account during the year under review.

41. Disclosure of certain types of agreements binding the Company:

Disclosure of certain types of agreements binding the Company, as prescribed under Schedule V part G of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable.

As on the date of this report, there are no agreements entered into by the shareholders, promoters, promoter group entities, related partes, directors, key managerial personnel, employees with the Company or with a third party, solely or jointly, which, either directly or indirectly or potentially or whose purpose and effect is to, impact the management or control of the Company or impose any restriction or create any liability upon the Company. Accordingly, the information required to be disclosed under clause 5A of paragraph A of Part A of Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable.

42. Acknowledgements:

The Directors would like to place on record their sincere appreciation to the companys customers, vendors, and bankers for their continued support to the company during the year. The Directors also wish to acknowledge the contribution made by employees at all levels for steering the growth of the organization. We thank the Government of India, the state governments and other government agencies for their assistance and co-operation and look forward to their continued support in the future. Finally, the Board would like to express its gratitude to the members for their continued trust, cooperation, and support.