Modipon Ltd Directors Report

To

The Members,

Your directors are pleased to present the 59^th Annual Report ("Report") together with the audited financial statements of Modipon Limited (the "Company") for the financial year ended March 31,2026.

FINANCIAL HIGHLIGHTS

The audited financial statements of the Company for the financial year ended March 31, 2026, have been prepared in accordance with the Indian Accounting Standards ("Ind AS") and the applicable provisions of the Companies Act, 2013 (the "Act") and the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") forms part of this Annual Report.

The financial performance of the Company for FY 2025-26 as compared with the previous financial year is summarised below:

Particulars	2025-26 ( Lakhs)	2024-25 ( Lakhs)
Turnover	-	-
Other Income	-	4.82
Total Income	-	4.82
Total Expenses	51.05	70.98
Gross Profit / (Loss) before depreciation	(51.05)	(66.16)
Depreciation	-	-
Profit/(Loss) after depreciation	(51.05)	(66.16)
Exceptional income/ (Losses)	-	-
Profit/ (Loss) before tax	(51.05)	(66.16)
Tax / extraordinary items	-	-
Net Profit/(Loss) after Tax	(51.05)	(66.16)

During FY 2025-26, the Company did not generate revenue from operations and reported a loss of ?51.05 Lakhs, as compared with a loss of ?66.16 Lakhs in the previous financial year.

STATE OF AFFAIRS OF THE COMPANY

As reported in earlier years, the manufacturing operations of the fibre unit of the Company had been permanently closed after seeking requisite permission from the Government of Uttar Pradesh (“UP Government") under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947.

During FY 2025-26, the Company did not generate revenue from operations and incurred a loss of ?51.05 Lakhs.

The Company continues to pursue the pending land-related matters with the UP Government and is evaluating opportunities for optimal utilisation of its assets, including development of the industrial project at Modinagar, subject to resolution of the pending matters and receipt of requisite approvals from the authorities concerned.

FUTURE BUSINESS OUTLOOK

The Company continues to evaluate opportunities for rehabilitation and optimal utilisation of its resources and proposes to undertake appropriate business activities, including development of an industrial project, at an opportune time, subject to resolution of the pending land matters and obtaining requisite regulatory approvals.

BOARD MEETINGS

The Board of Directors ("Board"/ "Directors") met 5 (Five) times during the FY 2025-26. The details of the meetings are provided in the Corporate Governance Report forming part of this Annual Report.

The maximum interval between any two meetings did not exceed the period as prescribed under the Act.

DIVIDEND

In view the losses suffered by the Company in the past and the Companys financial position, the Board has not recommended any dividend for FY 2025-26.

OPERATIONS

During the year under review, the Company did not generate any revenue from operations and reported a loss of ?51.05 Lakhs as against a loss of ?66.16 Lakhs in FY 2024-25.

SHARE CAPITAL

The authorized share capital of the Company as on March 31, 2026, was 25,00,00,000 divided into 2,00,00,000 equity shares of 10 each and 5,00,000 preference shares of 100 each. There was no change in the capital structure of the Company during the period under review.

As on March 31,2026, the issued, subscribed and paid-up share capital of the Company comprised of 1,15,76,689 equity shares of 10 each and 71,792 preference shares of 100 each. All equity shares of the Company carry equal voting rights.

DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP)

The composition of Board of Directors and KMP of the Company as on March 31, 2026 is detailed in the Corporate Governance Report forming part of this Report.

During FY 2025-26, the following changes took place in the composition of the Board:

• Ms. Kavita Rani (DIN: 08853423) was re-appointed as the Non-Executive Independent Director for a second term of five consecutive years with effect from July 31,2025.

• Mr. Manish Modi (DIN: 00030036) was re-appointed as Additional Director designated as Chairman & Managing Director for a period of five years with effect from May 31, 2025.

• Mr. Nitesh Kumar (DIN: 06439789) was re-appointed as NonExecutive Independent Director for a second term of five consecutive years with effect from March 02, 2026.

The aforesaid re-appointments were approved by the Board of Directors, based on the recommendations of the Nomination and Remuneration Committee ("NRC"), and by the Members of the Company at the 58th Annual General Meeting held on August 26, 2025. The re-appointment of Mr. Manish Modi as Chairman & Managing Director was also approved by the Central Government.

Subsequent to the close of the financial year, based on the recommendation of the NRC, the Board redesignated Mr. Vineet Kumar Thareja as Chief Compliance Officer, Chief Financial Officer and Company Secretary of the Company with effect from May 29, 2026.

SENIOR MANAGEMENT PERSONNEL (SMPs)

During FY 2025-26, there were no appointments/cessations of Senior Management Personnel.

Subsequent to the close of the financial year, the Board redesignated Mr. Vineet Kumar Thareja as the Chief Compliance Officer, Chief Financial Officer and Company Secretary of the Company with effect from May 29, 2026.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

The Company has received necessary declaration from each independent director confirming that he / she meets the criteria of independence prescribed under section 149(6) of the Act, code for independent directors and regulation 16(1)(b) of the Listing Regulations.

LISTING ON STOCK EXCHANGE

The equity shares of the Company are listed on BSE Limited.

COMMITTEES OF THE COMPANY

As on March 31, 2026, the Board had four committees: Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Risk Management Committee.

A detailed note on the composition of the Board and its committees is provided in the Corporate Governance Report, which forms part of this Annual Report.

During the year, all recommendations made by the committees were duly considered and approved by the Board.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In compliance with section 177(9) of the Act and regulation 22 of Listing Regulations, the Company has in place a whistleblower policy incorporating vigil mechanism to enable directors, employees and other stakeholders to report genuine concerns and unethical practices, with direct access to the Chairperson of the Audit Committee.

The Policy was revised by the Board on the recommendation of the Audit Committee on May 30, 2025 and the same can be accessed on the Companys website at https://modipon.net/wp- contentluploadsl2026IQ5IWhistle-Blower-Policv.pdf.

It is affirmed that no person has been denied access to the Audit Committee.

INTERNAL FINANCIAL CONTROL

The Company has, in all material respects, an adequate internal financial control system over financial reporting and such controls were operating effectively as at March 31, 2026, except for the absence of an audit trail (edit log) facility in the accounting software used for maintaining the books of account, as reported by the Statutory Auditors.

NOMINATION AND REMUNERATION & BOARD DIVERSITY POLICY

The details about the Nomination & Remuneration Policy of the Company, formulated by the Nomination & Remuneration Committee of the Company, is detailed in the Corporate Governance Report forming part of this Report.

The Policy governs the criteria for nomination, re-appointment, remuneration and evaluation of the directors, key managerial personnel and senior management personnel, including criteria for determining their qualifications, positive attributes, independence and Board diversity.

The Policy was revised on May 30, 2025 and is available on the Companys website at https://modiDon.net/wD-content/ uploads/2026/05/Nomination-and-Remuneration-Board- Diversitv-Policv-1.pdf

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS

Particulars of loans, guarantees and investments, as applicable, are disclosed in the Notes to the Financial Statements forming part of this Annual Report.

TRANSFER TO RESERVES

During FY 2025-26, the Company has not transferred any amount towards General Reserve.

CHANGES IN THE NATURE OF BUSINESS

There was no change in the nature of business of the Company during FY 2025-26.

PARTICULARS OF REMUNERATION

The disclosures relating to remuneration of Directors and KMP as required under section 197(12) of the Act, read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided below:

a. Ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year

Name of Director/ KMP	Designation	Remuneration of Directors for FY 2025-26 ( Lakhs)	% increase in remuneration in FY 2025-26	Ratio of Remuneration to the median remuneration of employee*
Mr. Manish Modi	Chairman & Managing Director	Nil	NA	NA
Mrs. Aditee Modi	Non-Executive Director	Nil	NA	NA
Mr. Mayur Maheshwari	Nominee Director	Nil	NA	NA
Mr. Shashi Kant Ranjan	Non-Executive Independent Director	1.80	Nil	Refer Note below*
Ms. Kavita Rani	Non-Executive Independent Director	1.80	Nil
Mr. Nitesh Kumar	Non-Executive Independent Director	1.80	Nil

*Since Non-Executive Independent Directors did not receive any remuneration during the FY 2025-26, except sitting fees for attending the board and committee meetings, the required details are not applicable.

b. Percentage increase in remuneration of each director, Company Secretary, Chief Financial Officer in the financial year

Name and Designation of Director/ KMP	Remuneration of Directors/ KMP for FY 2025-26 ( Lakhs)	% increase in remuneration in FY 2025-26
Vineet Kumar Thareja - Chief Compliance Officer, Chief Financial Officer & Company Secretary	27.00	50%

*Remuneration to be paid includes bonus and excludes traveling expense, if any.

c. The percentage increase in the median remuneration (based on salary) of employees in the FY 2025-26. As on March 31,2026, there are two whole-time key managerial personnels in the Company and one employee. Information is not comparable and hence, not stated.

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

As on March 31, 2026, there are two whole-time key managerial personnels in the Company and one employee. Information is not comparable and hence, not stated.

e. No. of permanent employees on the rolls of the Company

As on March 31,2026, the Company had 3 (three) employees, out of which two are on retainership basis.

Subsequent to the closure of the manufacturing operations of fibre unit of the Company, dues of the erstwhile workmen/ employees have been substantially settled, except in respect of five ex-workmen who had raised claims in excess of the dues paid to other workmen. The Honble DRT-II, New Delhi, directed the concerned workmen to approach the Deputy Labour Commissioner (DLC) for adjudication of their claims. The Company had deposited ?27 lakhs with the DRT towards the dues of the said workmen, which, in the absence of any claim before the DLC, was subsequently released by the DRT to Punjab National Bank (PNB). The DLC, vide order dated September 8, 2022, determined the dues payable to the said

workmen at ?21,74,758 as against their aggregate claim of ?2,84,75,199, and the Company deposited the determined amount in compliance with the said order. The said order was challenged by the workmen before the Honble High Court of Allahabad, which, vide order dated August 13, 2026, disposed of the matter without interfering with the order of the DLC.

None of the employees were in receipt of remuneration of ?1.02 crores or more per annum or none of the employees employed for part of the year and in receipt of remuneration of ?8.5 Lakhs per month or more, as required under section 197(12) of the Act, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The employees are neither relatives of any directors of the Company, nor hold 2% or more of the paid-up equity share capital of the Company as per rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

f. Affirmation with Remuneration Policy

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits, including from the public, during FY 2025-26. Accordingly, no principal or interest was outstanding as at March 31,2026 and there was no amount liable to be transferred to the Investor Education and Protection Fund.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF FINANCIAL YEAR AND TILL THE DATE OF THIS REPORT

There have been no material changes or commitments affecting the financial position of the Company between the end of FY 2025-26 and the date of this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Considering that the manufacturing operations of the fibre unit of the Company have remained permanently closed, the particulars relating to conservation of energy, technology absorption and research and development are not applicable to the Company.

During the year under review, there were no foreign exchange earnings or outgo.

AUDITORS AND AUDIT REPORT

B.M. Chatrath & Co. LLP, Chartered Accountants, (Firm Regn. No. E300025) were appointed as the statutory auditors of the Company for a second term of five consecutive years from the conclusion of the 54th annual general meeting ("AGM") held on September 27, 2021 till the conclusion of 59th AGM to be held in the year 2026. Accordingly, their second consecutive terms as Statutory Auditors of the Company concludes at the ensuing 59th AGM.

In view of the completion of the tenure of the existing Statutory Auditors and based on the recommendation of the Audit Committee, the Board of Directors, at its meeting held on May 29, 2026, approved the appointment of M/s. Vasu Bansal & Co., Chartered Accountants (FRN: 034332C), as the Statutory Auditors of the Company for the first term of five consecutive years, commencing from the conclusion of the 59th AGM until the conclusion of the 64th AGM, subject to the approval of the Members at ensuing AGM.

The proposed remuneration of the Statutory Auditors is ?3,20,000/- (Rupees Three Lakh Twenty Thousand only) per annum, plus applicable taxes and reimbursement of reasonable out-of-pocket expenses, as may be approved by the Board in consultation with the Statutory Auditors.

M/s Vasu Bansal & Co. have given their consent and eligibility certificate and confirmed that they satisfy the applicable

requirements under Sections 139 and 141 of the Act and the Rules made thereunder.

The Board recommends the appointment of M/s. Vasu Bansal & Co., Chartered Accountants, as Statutory Auditors of the Company for the approval of the Members at the ensuing Annual General Meeting.

AUDITORS REPORT

With reference to the qualifications contained in the Statutory Auditors Report, the Directors state that the observations made by the Auditors are detailed in the relevant Notes to the Financial Statements and Significant Accounting Policies forming part of the Annual Report and, accordingly, do not call for any further comments from the Board.

The Statutory Auditors were present at the last Annual General Meeting of the Company.

COST AUDIT AND MAINTAINANCE OF COST RECORDS

In view of permanent closure of manufacturing operations of the fibre unit of the Company, the provisions relating to the appointment of cost auditor and maintenance of cost records are not applicable to the Company.

REPORTING OF FRAUDS

During FY 2025-26, the statutory auditor and the secretarial auditor have not reported any instance of fraud committed in the Company by its officers or employees.

DIRECTORS RESPONSIBILITY STATEMENT

The Directors of your Company confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) they have 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/ loss of the Company for that period;

(iii) they have taken proper and sufficient 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;

(iv) that in view of the permanent closure of the manufacturing operations of the fibre unit of the Company, the annual accounts have not been prepared on a going concern basis;

(v) they have laid down internal financial controls which are adequate and operating effectively, except for the matter relating to the absence of an audit trail (edit log) facility in the accounting software used for maintaining the books of account, as reported by the Statutory Auditors; and

(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company.

ANNUAL RETURN

In accordance with the provisions of the Act, the annual return of the Company is available on website of the Company at https://modipon.net/annual-return/.

SECRETARIAL AUDIT

Mr. Ranjeet Kumar Verma, Ranjeet Verma & Associates, Practicing Company Secretary (FCS No. 6814 and CP No.7463) had been appointed as the Secretarial Auditor of the Company to hold the office for a term of five consecutive financial years commencing from FY 2025-26 till FY 2029-30.

The Secretarial Audit Report in Form MR-3 for the FY 2025-26, as issued by the Secretarial Auditor, forms part of this Annual Report and the same may be read together with the relevant disclosures and explanations, wherever applicable, contained in this Annual Report.

The Annual Secretarial Compliance Report issued by the Secretarial Auditor in terms of regulation 24A of the Listing Regulations has been submitted to the Stock Exchanges within the statutory timelines and is available on the website of the Company at https://modipon.net/wp-content/uploads/2026/06/ Secretarial-Compliance-Report-%E2%80%93-31-Mar-26.pdf

The Secretarial Auditor was present at the last Annual General Meeting of the Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS

During the year under review, there have been no significant and material orders passed by any regulators/courts/tribunals that could impact the Companys operations in future, except the pendency of litigation before the UP Government, High Court and Supreme Court.

DISCLOSURES UNDER COMPANIES (ACCOUNTS) RULES, 2014

With respect to particulars required under rule 8(5)(xi) and (xii) of Companies (Accounts) Rules, 2014 please refer note no. VI and VII of the independent auditors report forming part of the Annual Report.

RELATED PARTY TRANSACTIONS

The Company has in place a policy on related party transactions which is available on the Companys website at https://modipon. net/wp-content/uploads/2026/05/Policy-on-Related-Party- Transactions.pdf

During FY 2025-26, the Company did not enter into any contracts or arrangements with related parties falling within the ambit of section 188 of the Companies Act, 2013. Details of other related party transactions, as reviewed and approved by the Audit Committee and the Board, as applicable, are disclosed in Note No. 41 to the financial statements.

During the financial year under review, the material Related Party Transactions, as applicable under regulation 23 of Listing Regulations were approved by the Members at the AGM held on August 26, 2025. The Company is also seeking approval of the Members at the ensuing AGM for the proposed material Related Party Transactions, as set out in the Notice convening the AGM.

FORMAL ANNUAL EVALUATION

The details relating to the annual performance evaluation of the Board, its Committees and individual Directors are provided in the Corporate Governance Report forming part of this Annual Report.

DISCLOSURE ON CONFIRMATION WITH THE SECRETARIAL STANDARDS:

Your directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India have been duly complied with.

CORPORATE GOVERNANCE

Our report on corporate governance for FY 2025-26 is annexed hereto and forms part of this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The provisions of section 135 of the Act relating to Corporate Social Responsibility are not applicable to the Company during FY 2025-26, as the Company does not meet the prescribed thresholds.

MATERNITY BENEFIT ACT, 1961

The provisions of the Maternity Benefit Act, 1961 are not applicable to the Company as the number of employees does not meet the minimum threshold prescribed under the Act.

POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

As the number of employees of the Company is less than ten, the requirement to constitute an Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is not applicable to the Company. During the financial year 2025-26, no complaint relating to sexual harassment was received by the Company.

ISSUE OF SHARES

During the year under review, the Company has not issued any sweat equity shares or shares with differential rights or grant any shares under Employee Stock Option Scheme nor did it buy-back any of its shares.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of section 164(2) of the Act except Mr. Mayur Maheshwari (DIN: 08882590) being a nominee Director of the Company appointed by the Uttar Pradesh State Industrial Development Authority (UPSIDA), has not attended any meeting of the Board of Directors of the Company for a continuous period of twelve months.

The Directors have made the requisite disclosures, as required under the provisions of the Act.

APPRECIATION

Your Directors would like to express their sincere appreciation for the cooperation and assistance received from the various departments of the Central and State Governments, UP State Industrial Development Authority (UPSIDA) and investors for their continued valuable support and assistance. Your directors also wish to thank all the officers and staff of the Company at all levels for their contribution, support and continued co-operation throughout the year.

	Sd/-
Place: New Delhi	Manish Modi
Dated: August 14, 2026	Chairman & Managing Director