Palred Technologies Ltd Directors Report.

To the Members,

Palred Technologies Limited, Hyderabad, Telangana, India

The Board of Directors hereby submits the report of the business and operations of your Company (‘the Company or ‘Palred) along with the audited "Financial statement for the "Fiscal Year ended March 31, 2021. The Consolidated performance of the Company and its subsidiaries has been referred to where required.

1. Financial summary/highlights

The performance during the period ended 31st March, 2021 has been as under:

Particulars

Standalone

Consolidated

2020-21 2019-20 2020-21 2019-20
Turnover/Income (Gross) 151.02 92.39 11,700.22 4,555.88
Other Income 81.17 104.21 177.94 156.38
Profit/loss before Depreciation, Finance Costs, 51.07 3.35 687.10 (290.70)
Exceptional items and Tax Expense
Less: Depreciation/ Amortisation/ Impairment 9.46 11.31 71.36 75.66
Profit /loss before Finance Costs, Exceptional 41.61 (7.96) 615.74 (366.36)
items and Tax Expense
Less: Finance Costs 0.31 0.88 273.69 94.35
Profit /loss before Exceptional items and Tax 41.30 (8.84) 342.05 (460.70)
Expense
Add/(less): Exceptional items (475.14) 0 0 0
Profit /loss before Tax Expense (433.84) (8.84) 342.05 (460.70)
Less: Tax Expense (Current & Deferred) 0 0 0 0
Profit /loss for the year (1) (433.84) (8.84) 342.05 (460.70)
Total Comprehensive Income/loss (2) 0.21 (2.94) (1.92) (21.06)
Total (1+2) (433.62) (11.78) 343.97 (481.76)
Balance of profit /loss for earlier years (6133.33) (6124.50) (6462.45) (6029.28)
Less: Transfer to Debenture Redemption Reserve 0 0 0 0
Less: Transfer to Reserves 0 0 0 0
Less: Dividend paid on Equity Shares 0 0 0 0
Less: Dividend paid on Preference Shares 0 0 0 0
Less: Dividend Distribution Tax 0 0 0 0
Balance carried forward (6567.17) (6133.33) (6229.27) (6462.45)

2. Overview & state of the companys affairs:

Revenues – standalone

During the year under review, the Company has recorded an income of Rs.232.19 Lakhs and loss of Rs. (433.62) Lakhs as against the income of Rs.196.60 Lakhs and loss of Rs. (11.78)

Lakhs in the previous financial year ending 31.03.2020.

Revenues – Consolidated

During the year under review, the Company has recorded an income of Rs.11878.17 Lakhs and profit of Rs.343.97 Lakhs as against the income of Rs.4712.26 Lakhs and loss of Rs. (481.76)

Lakhs in the previous financial year ending 31.03.2020. The Company is looking forward for good profit future.

3. Dividend:

Keeping the Companys growth plans in mind, your Directors have decided not to recommend dividend for the year.

4. Transfer to reserves:

Pursuant to provisions of Section 134 (3) (j) of the Companies Act, 2013, the company has not proposed to transfer any amount to general reserves account of the company during the year under review.

5. Investor Relations:

The Company continuously strives for excellence in its Investor Relations engagement with International and Domestic investors through structured conference-calls and periodic investor/ analyst interactions like individual meetings, participation in investor conferences, quarterly earnings calls and analyst meet from time to time. The Company ensures that critical information about the Company is available to all the investors, by uploading all such information on the Companys website.

6. Material changes & commitment affecting the financial position of the company:

There have been no material changes and commitments of the Company which have affecting the occurred during the end of the Financial Year of the Company to which the fi

7. Significant & material orders passed by the regulators or courts or tribunals:

No significant or material orders have been passed against the

Company by the Regulators, Courts or Tribunals, which impacts the going concern status and companys operations in future.

8. Transfer of un-claimed dividend to Investor Education and Protection:

There is no such amount of Un-paid or Unclaimed Dividend be transferred to Investor and Education and Protection Fund for the financial year ended 31st March 2021.

9. Details of utilization of funds:

During the year under review, the Bank has not raised any funds through Preferential Allotment or Qualified Institutions Placement as specified under Regulation 32(7A) of the Securities and

Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

10. Details of Nodal Officer :

The Company has designated Mr. Harish Naidu as a Nodal

Officer for the purpose of IEPF.

11. Investor Education and Protection Fund (IEPF)

Pursuant to the provisions of Section 124 of the Act, Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules") read with the relevant circulars and amendments thereto, the amount of dividend remaining unpaid or unclaimed for a period of seven years from the due date is required to be transferred to the Investor Education and Protection Fund ("IEPF"), constituted by the Central Government During the Year, no amount of dividend was unpaid or unclaimed for a period of seven years and therefore no amount is required to be transferred to Investor Education and Provident Fund under the Section 125(1) and Section 125(2) of the Act.

12. Revision of financial statements:

There was no revision of the financial statements for the year under review.

13. Change in the nature of business, if any:

The Company has not undergone any change in the nature of business during the FY 2020-21.

14. Deposits from public:

The Company has not accepted any public deposits during the Financial Year ended March 31, 2021 and as such, no amount of principal or interest on public deposits was outstanding as on the date of the balance sheet. Since the Company has not accepted any deposits during the Financial Year ended March 31, 2021, there has been no non-compliance with the requirements of the Act.

15. Depository System:

SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 mandate that the transfer, except transmission and transposition, of securities shall be carried out in dematerialized form only with effect from 1st April 2019. In view of the numerous advantages offered by the Depository system as well as to avoid frauds, members holding shares in physical mode are advised to avail of the facility of dematerialization nancial statements relate and the date of the report. from either of the depositories. The Company has, directly as well as through its RTA, sent intimation to shareholders who are holding shares in physical form, advising them to get the shares dematerialized.

16. Subsidiary companies:

Your Company has three subsidiaries namely Palred Technologies Services Private Limited, Palred Electronics Private Limited and Palred Retail Private Limited as on March 31, 2021. In accordance with Section 129(3) of the Act, Consolidated Financial Statements have been prepared which form part of this Annual Report. As required under Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules,

2014, a statement containing the salient features of the financial statements of the subsidiaries in the prescribed form AOC-1 is enclosed as Annexure – B to this Report.

In accordance with Section 136 of the Act, the separate audited accounts of the subsidiary companies will be available on the website of the Company, www.palred.com and the Members desirous of obtaining the accounts of the Companys subsidiaries may obtain the same upon request. These documents will be available for inspection by the members, till the date of AGM during business hours at registered office of the company.

The Policy for determining Material Subsidiaries, adopted by your Board, in conformity with the SEBI Listing Regulations can be accessed on the Companys website at www.palred.com.

17. Performance highlights of key operating subsidiaries:

Palred Electronics Private limited:

Palred Electronics Private Limited (PEP) owns & operates an electronics / mobile accessories brand called pTron. Living by the slogan of #BeLoudBeProud - pTron is a lifestyle electronics & audio accessories brand offering high-quality audio & technology products that enhances life. pTron aims to make technology simple, affordable and accessible to all with gadgets that are easy-to-use yet futuristic & aesthetically modern, at pocket-friendly prices. Over the last couple of years the name pTron has become synonymous to quality mobile accessories backed by warranty at super affordable prices. We have extended our portfolio to include a wide range of audio products such as wireless neckbands, wireless earphones, wired & wireless headsets, wired earphones, and more. pTrons strength lies in its wide range of products whose quality is backed by warranty but offers them at competitive prices in the branded accessories category for the mid-market. pTron has sold 2.8 million units in FY 2021 and targets to sell 5 million units in FY 2022. It is one of the largest selling brands on Amazon.

We are an Indian company having an Indian brand and proud about it. We are confident that pTron as an Indian brand can be built successfully in India and in future as a global brand. We have our own office in China and we have built the capabilities to design, create a BOM (bill of materials/SKD kits), assemble them through contract manufacturers in China and import them currently. Over the last 3 years, PEP has gained in-depth knowledge of this business and we have already transferred some value addition to India such as Packing, testing and repair/ refurbishing. The Company has 35,000 leased Warehouse /

Fulfilment Centre in Kurnool. The facility employees 200+ direct

& contract employees. pTron commissioned its manufacturing facility in the same premises in August 2020. With rigorous R&D pTron manufactured Indias First True Wireless Earbuds from the India plant along with Power banks. pTron is committed to delight its customers with amazing, affordable, and well-built products that disrupts the fast paced lifestyle and audio accessories segment. We recognize the importance of strong QC & QA capabilities to continue meeting customer and stakeholders demand, leading to the establishment of a word-class brand. There is a strong emphasis on quality & assurance across all levels of design, manufacturing and assembly in terms of production test development, meticulous failure analysis, reliability testing, optimized final assembly, test, and pack processes from firmware programming and board test through customization, labeling, and packaging. pTron aims to add more products to the Made in India portfolio & reduce dependency on its Chinese counterpart without compromising on the quality. The team is constantly working on adding multiple new products to the portfolio in the accessories & the audio category. For constant development and strengthening of our facilities, we are rigorously adding more machinery to the Kurnool facility and upgrading the skill set of the employees to be able to provide state-of-the-art products to our consumers. pTron is positioned in mid-market segment which is characterized by low-price (Rs.500 to Rs.1200 depending on the product category), good quality, high volume & high margin products with warranty. It has more than 200 SKUs as of now and plan to add more products in the following categories.

• Expanding Audio category and introducing new technology

• Introducing new products with Active noise reduction features like ANC, ENC, CVC, DSP and other noise reduction technologies will focus on promoting the noise reduction function of headphones.

• Gaming Audio Products - Low Latency & Clear Communication

• Introducing IOT app for - Personalized equalizer, Play music and other information. Can be merged with Fitness IOT, will also be used in promoting new launches

• Expanding Mobile power accessories, Power banks, QC chargers, Car chargers, Cables, Qi Chargers

• Introducing affordable Smart watches

• PC & Camera accessories

Palred Retail Private Limited:

Palred Retail Private Limited owns ecommerce website, ptron. in and www.LatestOne.com that specialize in selling of tech and mobile accessories such as Bluetooth speakers and headsets, cables, power banks, headsets, smart watches, fashion accessories etc. The company also sells through other major online retailers like Flipkart, Snapdeal, PayTM mall etc.

Palred Technology Services Private Limited:

Palred Technology Services Private Limited offers a bouquet of Products through its brand "Xmate" that is exclusively available on Amazon.in. Xmate Sells products like Bluetooth headsets, Bluetooth speakers, wired headsets, chargers and cables, Computer Accessories, Cameras & Camera Accessories etc. The brand faced many challenges during the year because of high advertisement costs and competition from other big brands. The Company was not able to achieve desired growth and it continues to make losses. Hence, the Company has decided to exit "Xmate" brand business.

18. Companies which have become or ceased to be subsidiaries:

During the FY 2020-21, there was no change in subsidiaries. For further analysis on the consolidated performance, the attention is invited to the section on Management Discussion and Analysis and notes to the consolidated financial statements

19. Investment in subsidiaries:

During financial year 2020-21, the Company had not infused any capital in Subsidiary Companies.

20. Brand protections:

Your Company has taken appropriate actions against counterfeits, fakes and other forms of unfair competitions/ trade practices.

PALRED, PTRON, #BELOUDBEPRIUD, DaZon, Xmate and LATESTONE are key intangible assets of the Company and its subsidiaries.

21. Independent directors familiarization programmes:

Independent Directors are familiarized about the Companys operations, businesses, financial performance and significant development so as to enable them to take well-informed decisions in timely manner. Interaction with the Business heads and key executives of the Company is also facilitated. Detailed presentations on important policies of the Company are also made to the directors. Direct meetings with the Chairperson are further facilitated to familiarize the incumbent Director about the Company/its businesses and the group practices.

The details of familiarisation programme held in FY 2020-21 are also disclosed on the Companys website and its web link is http://www.palred.com

22. Board Evaluation

Performance of the Board and Board Committees was evaluated on various parameters such as structure, composition, diversity, experience, corporate governance competencies, performance of specific duties and obligations, quality of decision-making and overall Board effectiveness. Performance of individual Directors was evaluated on parameters such as meeting attendance, participation and contribution, engagement with colleagues on the Board, responsibility towards stakeholders and independent judgement. All the Directors were subjected to peer-evaluation. All the Directors participated in the evaluation process. The results of evaluation were discussed in the Board meeting held in February 2021. The Board discussed the performance evaluation reports of the Board, Board Committees, Individual Directors, and Independent External Persons. The Board upon discussion noted the suggestions / inputs of the Directors. Recommendations arising from this entire process were deliberated upon by the Board to augment its effectiveness and optimize individual strengths of the Directors.

The detailed procedure followed for the performance evaluation of the Board, Committees and Individual Directors is enumerated in the Corporate Governance Report.

23. Meetings of the Board

During the year, four (4) meetings of the Board of Directors of the Company were convened and held in accordance with the provisions of the Act. The date(s) of the Board Meeting, attendance by the directors are given in the Corporate Governance Report forming an integral part of this report.

24. Committees of the Board

There are various Board constituted Committees as stipulated under the Act and Listing Regulations namely Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship and Risk Management Committee. Brief details pertaining to composition, terms of reference, meetings held and attendance thereat of these Committees during the year have been enumerated in Corporate Governance Report forming part of this Annual Report.

25. Audit Committee Recommendations:

During the year, all recommendations of Audit Committee were approved by the Board of Directors.

26. Directors and key managerial personnel:

As on date of this report, the Company has eight Directors, out of those four are Independent Directors including two Woman Independent Directors.

a) Appointment/Re-appointment of Directors of the Company:

In accordance with the provisions of the companies Act, 2013 and Articles of Association of the company Mr. M. V. L.N. Murthy, non-independent -non executive director, retire by rotation and being eligible , offers himself for re-appointment. As per the requirements of Regulation 36(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") (as amended) and Clause 1.2.5 of the Secretarial Standard 2 as issued by the ICSI, a statement containing the requisite details of Mr. M. V. L.N. Murthy seeking re-appointment is given as below:

Name of the Director Mr. M. V. L.N. Murthy
Date of Birth 01.06.1973
Qualification Graduate in Mathematics & Science
Brief Resume Murthy heads Palred Retail Pvt Ltd, has more than 20 years of experience in building large scalable, secure software products, implementation, consulting and technology leadership and management experience with successful track record as CTO for 5years.
Experience spans from fast growing, early stage start-ups to global corporations, with deep industry knowledge in Information Technology & Services, ecommerce B2C, B2B, logistics, transportation, semiconductor distribution and high-tech industries. He is Mathematics and Science Graduate from Nargarjuna University, Andhra Pradesh, India.
Expertise in specific functional areas Information Technology & Services, e commerce
Names of Listed entities in which the person also holds the directorship and the membership of Committees of the board NIL
No. of Equity Shares held in the Company NIL
Inter se relationship with any Director None

b) Key Managerial Personnel:

Key Managerial Personnel for the financial year 2020-21

• Mr. Palem Supria Reddy, Chairperson & Managing Director of the company.

Mr. P. Harish Naidu, Chief financial

• Mr. Shruti Mangesh Rege, Company Secretary &

Compliance Officer of the Company.

27. Statutory audit and auditors report:

The members of the Company at their Annual General Meeting held on 30th September, 2019 have appointed M/s. MSKA

& Associates., as statutory auditors of the Company to hold office until the conclusion of 25th Annual General meeting of the Company. The Auditors Report for fiscal year 2020-2021 does not contain any qualification, reservation or adverse remark. The Auditors Report is enclosed with the financial statements in this Annual Report. The Company has received audit report with unmodified opinion for both Standalone and Consolidated

Audited Financial Results of the Company for the Financial Year ended March 31, 2021 from the statutory auditors of the Company.

The Auditors have confirmed that they have subjected themselves to the peer review process of Institute of Chartered

Accountants of India (ICAI) and hold valid certificate issued by the Peer Review Board of the ICAI.

28. Internal auditors:

Pursuant to provisions of Section 138 read with Rule 13 of the Companies (Accounts) Rules, 2014 and Section 179 read with Rule 8(4) of the Companies (Meetings of Board and its Powers) Rules, 2014; during the year under review, the Internal Audit of the functions and activities of the Company was undertaken by M/s Lakshmi Niwas & Co., the Internal Auditor of the Company. Deviations are reviewed periodically and due compliance was ensured. Summary of Significant recommendations and its implementations are reviewed by the Audit Committee and concerns, if any, are reported to the Board.

There were no adverse remarks or qualification on accounts of the Company from the Internal Auditor.

The Board has re-appointed M/s. Lakshmi Niwas & Co., Chartered Accountants, Hyderabad, as Internal Auditors for the Financial Year 2021-22.

29. Secretarial Auditor & Audit Report:

In terms of section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, based upon the recommendations of the Audit Committee, the Board of Directors had appointed M/s. S.S. Reddy & Associates, Practicing Company Secretaries (CP No. 7478) as the Secretarial Auditor of the Company, for conducting the Secretarial Audit for financial year ended March 31, 2021.

The Secretarial Audit was carried out by M/s. S.S. Reddy &

Associates, Company Secretaries (CP No. 7478) for the financial year ended March 31, 2021. The Report given by the Secretarial Auditors along with managements explanation on observations of the Auditors is enclosed as Annexure-L to this report.

Secretarial Auditors Qualification:

The qualifying remarks, reported by the Secretarial Auditor in their report for the Financial Year ended 31st March, 2021 and the explanations of the management are tabulated below:

Si. No. Observation Explanation by the Management
1. Non-compliance with the requirements per- taining composition of board directors and Committees of the company The board of directors and Com- mittees of the Company are not duly Constituted during the period from 31.08.2020 to 30.09.2020 due to operations of the Company af- fected for undergoing pandemic SARS COVID-19.

30. Annual Secretarial Compliance Report:

SEBI vide its Circular No. CIR/CFD/CMD1/27/2019 dated February 08, 2019 read with Regulation 24(A) of the Listing Regulations, directed listed entities to conduct Annual Secretarial compliance audit from a Practicing Company Secretary of all applicable SEBI Regulations and circulars/guidelines issued thereunder. Further, Secretarial Compliance Report dated June 30, 2021, was given by M/s. S.S. Reddy & Associates, Practicing Company Secretary which was submitted to Stock Exchanges within 60 days of the end of the financial year.

31. Secretarial Audit of Material Unlisted Indian Subsidiaries:

M/s. Palred Electronics Private Limited (PEP) and Palred Technology Services Private Limited (PTS) and Palred Retail Private Limited (PRP) a material subsidiaries of the Company undertake Secretarial Audit every year under Section 204 of the Companies Act 2013. The Secretarial Audit of PEP & PTS & PRP for the Financial Year 2020-21 was carried out pursuant to Section 204 of the Companies Act 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The Secretarial Audit Report of PEP, PTS and PRP submitted by M/s. S.S. Reddy & Associates, Practicing Company Secretary. The Reports given by the Secretarial Auditor is annexed herewith and forms integral part of this Report.AuditObservations along with As required under Regulation 16(1) (C) of Listing Regulations, the Company has formulated and adopted a policy for determining ‘Material Subsidiaries, which has been hosted on its website at: https://www. palred.com

32. Cost records and cost audit:

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Act, are not applicable for the business activities carried out by the Company.

33. No Frauds reported by statutory auditors

During the Financial Year 2020-21, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under section 134(3) (ca) of the Companies Act, 2013.

34. Declaration by the Company

None of the Directors of the Company are disqualified for being appointed as Directors as specified in Section 164 (2) of the Act read with Rule 14 of Companies (Appointment and Qualifications of Directors) Rules, 2014.

35. Conservation of energy, technology absorption and foreign exchange outgo:

The required information as per Sec.134 (3) (m) of the Companies Act 2013 is provided hereunder and Rule 8 of Companies (Accounts) Rules, 2014: A. Conservation of Energy: Your Companys operations are not energy intensive. Adequate measures have been taken to conserve energy wherever possible by using energy efficient computers and purchase of energy efficient equipment.

B. Technology Absorption:

1. Research and Development (R&D): NIL

2. Technology absorption, adoption and innovation: NIL

C. Foreign Exchange Earnings and Out Go:

1. Foreign Exchange Earnings: Nil

2. Foreign Exchange Outgo: Nil

36. Management discussion and analysis report:

Management discussion and analysis report for the year under review as stipulated under Regulation 34(2) (e) read with schedule V, Part B of SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015 with the stock exchange in India is annexed herewith as Annexure- G to this report.

37. Risk management policy:

The Board of Directors had constituted Risk Management Committee to identify elements of risk in different areas of operations and to develop policy for actions associated to mitigate the risks. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness.

The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continual basis.

38. Corporate governance:

Your Company has taken adequate steps to ensure compliance with the provisions of Corporate Governance as prescribed under the Listing Regulations. A separate section on Corporate Governance, forming a part of this Report and the requisite certificate from the Companys Auditors confirming compliance with the conditions of Corporate Governance is attached to the report on Corporate Governance as Annexure E.

39. Annual Return:

Pursuant to Sections 92 & 134(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return in Form MGT-7 is also available on the Companys website URL: https://www.palred.com

40. Authorised and paid up capital of the company:

The authorized capital of the company stands at Rs. 35,00,00,000/- divided into 2,80,38,800 equity shares of Rs.10/- each and 6,96,12,014 redeemable optionally convertible cumulative preference shares of Rs. 100/- each. The companys paid up capital is Rs. 9,73,25,660/- divided into 97,32,566 equity shares of Rs. 10/- each.

41. Declaration of independence:

The Company has received declarations from all the Independent

Directors of the Company confirming that they meet with both the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 16(1)(b) read with Regulation 25 of the Listing Regulations attached as Annexure K.

In compliance with Rule 6 of Companies (Appointment and

Qualification of Directors) Rules, 2014, all the PIDs of the

Company have registered themselves with the India Institute of Corporate Affairs (IICA), Manesar and have included their names in the databank of Independent Directors within the statutory timeline.

The Independent Directors have also confirmed that they have complied with Schedule IV of the Act and the Companys Code of Conduct.

In terms of Regulations 25(8) of the Listing Regulations, the

Independent Directors have confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence.

During the year, Independent Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board of Directors and Committee(s).

42. Directors Responsibility Statement:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that for the financial year ended March 31, 2021: a) in the preparation of the annual accounts for the financial year ended 31 March 2021, the applicable accounting standards and schedule III of the Companies Act, 2013 have been followed and there are no material departures from the same; b) the Directors 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 your Company as on 31 March 2021 and of the profit and loss of the Company for the financial year ended 31 March 2021 ; c) proper and sufficient care has been 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 have been prepared on a going concern basis; e) Proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and f) Proper systems to ensure compliance with the provisions of all applicable laws were followed and that such systems were adequate and operating effectively.

43. Vigil Mechanism/Whistle Blower Policy:

The Company has formulated a Vigil Mechanism / Whistle Blower Policy pursuant to Regulation 22 of the Listing Regulations and Section 177(10) of the Act, enabling stakeholders to report any concern of unethical behaviour, suspected fraud or violation. The said policy inter-alia provides safeguard against victimization of the Whistle Blower. Stakeholders including directors and employees have access to the Managing Director & CEO and Chairperson of the Audit Committee.

During the year under review, no stakeholder was denied access to the Chairperson of the Audit Committee.

The policy is available on the website of the Company at www. palred.com.

44. Employee stock option scheme:

The Company has an Employee Stock Option (ESOP) scheme, namely "Employee Stock Option Scheme 2016-" (PALRED ESOP Scheme) which helps the Company to retain and attract right talent. The Nomination and Remuneration Committee (NRC) administers the Companys ESOP scheme. There were no changes in the ESOP scheme during the financial year under review. The ESOP scheme is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits)

Regulations, 2014 [SEBI (SBEB) Regulations, 2014].

Disclosure in compliance with the SEBI (Share Based Employee

Benefits) regulations, 2014are available on the company website of the company at www.palred.com

During the financial year 2020-21 no employee was granted stock option equal to or exceeding 1% of the issued share capital of the Company at the time of grant of options.

45. Corporate social responsibility policy:

Since your Company does not have net worth of Rs. 500 Crore or more or turnover of Rs. 1000 Crore or more or a net profit of Rs. 5 Crore or more during the financial year, section 135 of the

Companies Act, 2013 relating to Corporate Social Responsibility is not applicable and hence the Company need not adopt any Corporate Social Responsibility Policy.

46. Secretarial Standards:

The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and such systems are adequate and operating effectively. During the year under review, the Company was in compliance with the Secretarial Standards (SS) i.e., SS-1 and SS- 2, relating to "Meetings of the Board of Directors" and "General Meetings", respectively.

47. Insurance:

The properties and assets of your Company are adequately insured.

48. ParticularsofLoans,GuaranteesorInvestments

During the year under review, the Company has given a corporate guarantee to Palred Electronics Private Limited (a Subsidiary Company) amounting to Rs. 30,00,00,000/- (Rupees thirty crores only). Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the financial statements.

49. Internal Financial Control Systems:

Your Company has well laid out policies on financial reporting, asset management, adherence to Management policies and also on promoting compliance of ethical and well-defined standards.

The Company follows an exhaustive budgetary control and standard costing system. Moreover, the management team regularly meets to monitor goals and results and scrutinizes reasons for deviations in order to take necessary corrective steps. The Audit Committee which meets at regular intervals also reviews the internal control systems with the Management and the internal auditors.

The internal audit is conducted at the Company and covers all key areas. All audit observations and follow up actions are discussed with the Management as also the Statutory Auditors and the Audit Committee reviews them regularly.

50. Related Party Transactions:

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business. During the financial year 2020-21, there were no materially significant related

Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

In line with the provisions of Section 177 of the Act read with the Companies (Meetings of the Board and its Powers) Rules, 2014, omnibus approval for the estimated value of transactions with the related parties for the financial year is obtained from the

Audit Committee. The transactions with the related parties are routine and repetitive in nature.

The summary statement of transactions entered into with the related parties pursuant to the omnibus approval so granted are reviewed & approved by the Audit Committee and the Board of Directors on a quarterly basis. The summary statements are supported by an independent audit report certifying that the transactions are at an arms length basis and in the ordinary course of business The Form AOC-2 pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is is annexed herewith as Annexure- C to this report.

51. Policy on directors appointment and remuneration:

In adherence to the provisions of Section 134(3)(e) and 178(1)

& (3) of the Companies Act, 2013, the Board of Directors upon recommendation of the Nomination and Remuneration Committee approved a policy on Directors appointment and remuneration, including, criteria for determining qualifications, positive attributes, independence of a Director and other matters. The said Policy extract is covered in Corporate Governance Report which forms part of this Report and is also uploaded on the Companys website at www.palred.com.

52. Particulars of Employees and related Disclosure:

Disclosure pertaining to remuneration and other details as required under section 197 of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure–D to this Report.

The Statement containing the particulars of employees as required under section 197(12) of the Companies Act, 2013 read with rule 5(2) and other applicable rules (if any) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. During the year none of the employees is drawing a remuneration of Rs.1,02,00,000/- and above per annum or Rs.8,50,000/- per month and above in aggregate per month, the limits specified under the Section 197(12) of the Companies Act,2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

54. Shares transferred to investor education and protection fund:

No shares were transferred to the Investor Education and Protection Fund during the year under review.

55. Ratio of remuneration to each director:

Under section 197(12) of transactionsmadebythe the Companies Act, 2013, and Rule 5(1) (2) & (3) of the Companies (Appointment & Remuneration) Rules, 2014 read with Schedule V of the Companies Act, 2013 the ratio of remuneration of Mrs. Palem Supriya Reddy, Managing Director of the Company to the median remuneration of the employees is 1.56:1 and of Mr. P. Harish Naidu, CFO of the Company is 4.34:1.

56. Non-executive directors compensation and disclosures:

None of the Independent / Non-Executive Directors has any pecuniary relationship or transactions with the Company which in the Judgment of the Board may affect the independence of the Directors.

57. Industry based disclosures as mandated by the respective laws governing the company:

The Company is not a NBFC, Housing Companies etc., and hence Industry based disclosures is not required.

58. Failure to implement corporate actions:

During the year under review, no corporate actions were done by the Company.

59. Corporate insolvency resolution process initiated under the insolvency and bankruptcy code, 2016.

No corporate insolvency resolution processes were initiated against the Company under the Insolvency and Bankruptcy Code, 2016, during the year under review.

60. Policies:

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandated the formulation of certain policies for all listed companies. All the policies are available on our website (https:// www.palred.com/investors/ policies). The policies are reviewed periodically by the Board and updated based on need and new compliance requirement.

Name of the policy Brief Description Website link
Board Diversity Policy At Palred Technologies Limited, we believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors. https://www.palred.com
Nomination and Remuneration Policy This policy formulates the criteria for determining q u a l i f i c a t i o n s , c o m p e t e n c i e s , positive attributes and independence for the appointment of a director (executive / non- executive) and also the criteria for determining the remuneration of the Directors, key managerial personnel and other employees. https://www.palred.com
Policy on Material Subsidiaries The policy is used to determine the material subsidiaries and material non-listed Indian subsidiaries of the Company and to provide the governance framework for them. https://www.palred.com
Related Party Transaction Policy The policy regulates all transactions between the Company and its related parties https://www.palred.com

61. Statutory compliance:

The Company has complied with the required provisions relating to statutory compliance with regard to the affairs of the Company in all respects.

62. Code of conduct for the prevention of insider trading:

Pursuant to the provisions of SEBI (Prohibition of Insider Trading) Regulations, 2015 as amended from time to time, the Company has formulated a Code of Conduct for Prevention of Insider Trading ("Insider Trading Code") and a Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information ("UPSI"). The Code of Practices and Procedures for fair disclosure of UPSI is available on the website of the Company at https:// www. Palred.com

63. CEO/CFO Certification:

As required Regulation 17(8) read with Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015, the CEO/CFO certification is attached with the annual report as Annexure I.

64. Prevention of sexual harassment at workplace:

The Company has always believed in providing a safe and harassment free workplace for every individual working in its premises through various policies and practices. The Company always endeavours to create and provide an environment that is free from discrimination and harassment including sexual harassment.

The Company has adopted a policy on Prevention of Sexual Harassment at Workplace which aims at prevention of harassment of employees and lays down the guidelines for identification, reporting and prevention of undesired behaviour.

An Internal Complaints Committee ("ICC") has been set up by the senior management (with women employees constituting the majority). The ICC is responsible for redressal of complaints related to sexual harassment and follows the guidelines provided in the Policy.

During the financial year ended March 31, 2021, no complaints pertaining to sexual harassment have been received.

65. Green Initiatives:

In commitment to keep in line with the Green Initiative and going beyond it to create new green initiatives, electronic copy of the Notice of 22nd Annual General Meeting of the Company are sent to all Members whose email addresses are registered with the Company/Depository Participant(s). For members who have not registered their e-mail addresses, physical copies are sent through the permitted mode.

66. Event Based Disclosures

During the year under review, the Company has not taken up any of the following activities: 1. Issue of sweat equity share: NA

2. Issue of shares with differential rights: NA

3. Issue of shares under employees stock option scheme: NA 4. Disclosure on purchase by Company or giving of loans by it for purchase of its shares: NA

5. Buy back shares: NA 6. Disclosure about revision: NA 7. Preferential Allotment of Shares: NA

67. Disclosure pursuant to Part A of Schedule V of SEBI LODR

Disclosure pursuant to Part A of Schedule V read with Regulation 34(3) of SEBI is attached as Annexure-M of this report.

68. Other Disclosures:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: a. Issue of equity shares with differential rights as to dividend, voting or otherwise.

b. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report. c. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

69. Appreciation & acknowledgement:

Your Directors place on record their appreciation for the overwhelming co-operation and assistance received from the investors, customers, business associates, bankers, vendors, as well as regulatory and governmental authorities. Your Directors also thanks the employees at all levels, who through their dedication, co-operation, support and smart work have enabled the company to achieve a moderate growth and is determined to poise a rapid and remarkable growth in the year to come. Your Directors also wish to place on record their appreciation of business constituents, banks and other "financial institutions and shareholders of the Company like SEBI, BSE, NSE, NSDL, CDSL, ICICI Bank, Kotak Mahindra Bank and CITI Bank etc. for their continued support for the growth of the Company.

For and on behalf of the Board of
Palred Technologies Limited
Sd/- Sd/-
P. Supriya Reddy S. Vijaya Saradhi
Chairperson & Managing Director Director
(DIN: 00055870) (DIN: 03089889)
Place: Hyderabad
Date: 14.08.2021