Salzer Electronics Ltd Directors Report

The Directors have the pleasure in presenting the 40^thAnnual Report along with the Audited Financial Statements of the Company for the year ended March 31,2025

The Information furnished hereunder is in line with Section 134 of the Companies Act 2013 and applicable Provisions contained in the SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015.

1. PERFORMANCE REVIEW:-

Financial Summary of the Company

(Rs in Crs)

Particulars	Standalone		Consolidated
	For the year Ended March 31,2025	For the year Ended March 31, 2024	For the year Ended March 31,2025	For the year Ended March 31,2024
i Revenue from operations	1,382.92	1,135.58	1,418.33	1,166.31
ii Other Income	5.43	1.56	5.34	1.95
iii Total Revenue (I + II)	1,388.35	1,137.14	1,423.67	1,168.26
iv Expenses
a Cost of materials consumed	1,082.66	876.04-	1,082.95	888.47
b Purchase of stock in trade	-	-	12.68	-
c Changes in inventories of finished goods, work-in-progress and stock-in-trade	-34.02	-7.35	-33.69	-7.47
d Employee benefit expenses	53.89	42.30	58.97	46.64
e Finance Cost	40.81	33.67	41.14	34.09
f Depreciation and amortization expense	22.29	19.06	23.22	20.11
g Other expenses	155.45	114.39	163.52	121.70
h Total Expenses	1,321.08	1,078.11	1,348.99	1,103.53
v Profit before exceptional and extraordinary items and tax	67.27	59.03	74.68	64.73
vi Exceptional Items	15.18	0.37	-	-
vii Prior Period Items	-	-	-	-
viii Profit before tax & extraordinary items	82.45	59.40	74.68	64.73
ix Extraordinary items	-	-	-	-
x Profit before tax	82.45	59.40	74.68	64.73
xi Tax expense:	20.20	16.22	22.19	17.66
xii Share of Profit from Associates	NA	NA	0.02	-
xiii Profit for the period - After Tax (x-xi-xii)	62.25	43.18	52.47	47.07
xiv Earnings per equity share:
(1) Basic (in Rs.)	35.03	25.77	29.75	27.38
(2) Diluted (in Rs.)	35.21	24.12	29.67	25.34
xv Reserves and Surplus	512.60	448.68	526.87	456.08

2. ECONOMIC AND OPERATIONAL LANDSCAPE DURING THE YEAR

During FY25, the Indian economy demonstrated resilience with a GDP growth of around 6.5%. Inflation was somewhat enhanced in the early part of the year due to global factors but moderated gradually with effective monetary policy measures. The government continued to push capital expenditure and implement key policy initiatives, including the Production-Linked Incentive (PLI) schemes; focus on ease of doing business, infrastructure modernization, and green energy transition. The industrial sector saw moderate recovery with growth in core sectors like construction and manufacturing. Despite global headwinds, the overall economic and industrial environment remained stable and supportive of a long-term growth momentum.

In the backdrop of an uncertain economic environment caused by persistent global headwinds and their definite spill- over effects on the Indian market, Salzer delivered a resilient standalone performance in FY25. The company recorded an operating revenue of Rs.1,382.92 crore, reflecting a strong 22% growth over the previous year, driven primarily by robust demand in the industrial Switchgear and Wires & Cables segments. EBITDA, excluding other income, rose by 13.4% to Rs.124.94 crore. However, margins witnessed a moderate contraction to 9.03% from 9.70%, attributable to strategic investments in the companys emerging Smart Meter business. Profit after Tax grew significantly by 44.2% to Rs.62.26 crore, aided by an exceptional gain of Rs.15.18 crore from a partial divestment of investment in its subsidiary, Kaycee Industries Limited.

Over the last five years, Salzer has demonstrated a consistent growth, with sales rising at a Compounded Annual Growth Rate (CAGR) of 20%, reaching Rs.1,382.92 crore in FY25. Operating Profit and PAT also grew steadily at 15% and 19% CAGR respectively, reflecting strong execution, improved scale, and disciplined financial management across the business vertical.

Salzers export business continued its strong upward trajectory in FY25, registering a 24% growth to Rs.379 crore from Rs.305 crore in FY24. Exports contributed 27% to the total revenue, up from 23% in the previous year, reflecting increasing global acceptance of Salzers high-quality and reliable electrical solutions. Over the past five years, export revenue has grown at a robust CAGR of 30%, rising from Rs.98 crore in FY20. This sustained momentum underscores Salzers successful expansion into international markets and reinforces its strategic focus on diversifying its revenue streams, enhancing global presence, and supporting overall corporate growth.

3. INDIVIDUAL DIVISIONS PERFORMANCE AND CONTRIBUTIONS

i) Industrial Switch Gear Division:

The Industrial Switchgear segment continues to be the cornerstone of Salzer Electronics business, contributing significantly to its overall performance. In FY25, the segment recorded robust growth, driven by strong demand from industrial automation, infrastructure, and renewable energy sectors. Salzers wide range of switchgear products—such as rotary switches, load break switches, and modular switches—are well-recognized for their reliability, safety, and compliance with global standards. The companys focus on product innovation, customization, and expanding OEM relationships has helped strengthen its market leadership. With increased adoption of energy-efficient and intelligent control systems, the segment is poised to remain a key growth driver going forward.

The Industrial Switchgear segment of the Company sustained its strong growth momentum, posting revenues of Rs.798.21 crore in FY25—a notable 28% increase over Rs.621.25 crore in FY24. Over the five-year period from FY20 to FY25, the segment delivered an impressive CAGR of 26%,

reflecting consistent performance and increasing relevance in both domestic and global markets. This segment contributed 57% of the Companys total standalone revenue in FY25, reinforcing its position as the backbone of Salzers operations. Growth was underpinned by steady demand from core industries and the export business, continued product innovation, and a focus on delivering reliable, high-quality, and customized engineering solutions. The segment maintained a robust EBITDA margin of 11.84% in Fy25.

In FY25, Wire Harness, Transformers, Cam switches, Isolators, Conduit Tubing and Relays all had strong growth momentum. This strong performance reflects product diversity, market alignment, and robust customer acceptance.

ii) Wires and Cables

The Wires and Cables remains a vital contributor to Salzer Electronics overall business portfolio, reflecting consistent growth and strong market presence. In FY25, the segment recorded healthy performance, driven by increased demand from infrastructure, industrial, and residential sectors. Salzers comprehensive product range—including flexible cables, control cables, Data Cables and specialty wires-caters to the Indian markets, aligning with stringent safety and performance standards. The companys focus on quality assurance, customized solutions, and timely delivery has strengthened its reputation among OEMs. With government-led infrastructure development and rising electrification needs, the segment is poised for sustained expansion in the coming years.

Wires and Cables market is intensely competitive, with a mix of organized players and unorganized local manufacturers, leading to pricing pressures and the need for continuous product differentiation. Despite these challenges, Salzer has successfully navigated this landscape through consistent quality, and a strong OEM customer base.

The Wires and Cables Division of the Company maintained its steady growth trajectory, recording revenues of Rs.511.53 crore in FY25, marking a 14% increase over the previous year. Over the five- year period FY20 to FY25, the segment achieved a healthy CAGR of 14%, underlining its stability and consistent market demand. Contributing 37% to the Companys overall revenue in FY25, this segment continues to benefit from strong demand in infrastructure, industrial, and residential sectors.

iii) Building Products

This Division of the Company operates in a highly fragmented and intensely competitive market, with significant presence of unorganized players creating persistent pricing and margin pressures. As a result, growth in this Division has remained modest, primarily due to market-related challenges. Recognizing the need to reposition this vertical for long-term value, the Company has initiated strategic steps to expand into export markets. In line with this vision, Salzer secured its first international order from Australia, marking a key milestone in this segments journey Focused efforts are now underway to enhance product competitiveness, streamline distribution, and unlock future growth potential globally

Salzers Building Products segment posted revenue of Rs.76.22 crore in FY25, reflecting a 15% year-on-year growth. Over the five-year period FY20 to FY25, the segment recorded a healthy CAGR of 16%. Despite consistent efforts, the segment contributed only 6% to the Companys total standalone revenue in FY25 due to above said reason.

4. CONSOLIDATED FINANCIAL PERFORMANCE

The Company delivered a strong financial performance in FY25, recording consolidated operating revenue of Rs.1,418.33 crore, a 22% increase over Rs.1,166.31 crore in FY24. Operating profit rose by 14% to Rs.133.90 crore, compared to Rs.116.98 crore in the previous year. Net profit stood at Rs.52.47 crore, reflecting a growth of 11% over Rs.47.07 crore in FY24. The Companys consolidated net worth also improved significantly to Rs.526.09 crore as against Rs.456.08 crore in the previous year, registering a 15% increase.

5. KEY SIGNIFICANT DEVELOPMENTS

A. Re-entry into Energy Management through BBMP Project

After a gap of five years, in the Current financial year, has re-entered the Energy Management space by securing a significant Energy Efficiency Project from the Bruhat Bengaluru Mahanagara Palike (BBMP), The project, valued at Rs.192 crore, involves the implementation of a Centralized Control and Monitoring System (CCMS) and the replacement of existing conventional streetlights with energy-efficient LED lights across the East Zone and part of the Bommanahalli Zone of BBMP The contract is being executed in consortium with Schnell Energy Equipments Private Limited, leveraging their expertise in streetlight management. The project is scheduled to be completed within eight months, and the consideration will be received over a period of 84 months, as per the agreed terms. To facilitate smooth execution and lifecycle management, a Special Purpose Vehicle (SPV) has already been incorporated jointly with Schnell. This marks a focused and strategic step toward expanding Salzers footprint in energy efficiency solutions.

B. Poised for Scalable Growth in Smart Metering

During Financial Year 2024-25, the Company secured a repeat order for 50 crore for Smart Energy Meters from one of Indias largest Advanced Metering Infrastructure Service Providers (AMISP). This follows an earlier Q5 crore order from the same customer, reflecting continued trust in Salzers product quality and manufacturing capabilities. Backed by a state- of-the-art facility with an annual capacity of 4 million smart meters, Salzer is strategically positioned to meet ever growing demand under the Government of Indias Revamped Distribution Sector Scheme (RDSS).

While the smart metering industry presents a significant opportunity exceeding 25 cr meters nationwide, the pace of actual deployment on the ground has been slower than anticipated. AMISPs-who form the core customer base for this initiative-continue to face various practical challenges related to field implementation, including infrastructure readiness, DISCOM- level coordination, and integration issues. Acknowledging these hurdles, the Government of India recently extended the overall implementation timeline for the smart meter rollout by an additional two years, highlighting the complexity and scale of the program.

Despite these near-term execution challenges, Salzer remains optimistic about the long-term potential of the sector. The Company continues to engage closely with AMISPs and remains committed to scaling its smart metering operations, with the goal of becoming a longterm, reliable partner in Indias digital energy transformation.

6. STRATEGIC GROWTH DRIVERS FOR A FUTURE-READY SALZER

Salzers strategy for future growth is firmly anchored in innovation, diversification, and global expansion. The Company remains committed to developing technology-led solutions that address evolving customer needs and emerging industry trends.

Product Innovation is central to Salzers vision. The Company continues to explore and introduce advanced technology products across all business verticals, ensuring a robust pipeline of three to five new product launches annually

Diversification remains a key focus, particularly in high-margin segments such as wires and cables. By continuously broadening its product portfolio, Salzer aims to enhance profitability and market relevance.

Geographical Expansion is actively pursued, with strategic efforts underway to grow presence in emerging markets such as Africa and Australia. This not only drives export growth but also mitigates regional concentration risks.

Salzer is also open to technical alliances with global and domestic partners, aimed at accelerating product development and fostering shared innovation.

In addition, the Company is actively exploring inorganic growth opportunities through strategic acquisitions that complement its core business and add long-term value.

These integrated initiatives will collectively drive sustained growth, profitability, and leadership in the years ahead.

7. DIVIDEND

At the meeting held on May 24, 2025, the Board of Directors considered and recommended a final dividend of 25% (Rs.2.50 per equity share of face value Rs.10 each) for the financial year ended March 31, 2025. The total outflow on account of this proposed dividend amounts to Rs.4.42 crores.

The dividend, once approved by the shareholders at the ensuing Annual General Meeting, will be paid to all eligible members whose names appear in the Register of Members as on the record date within the statutory time limit

8. CAPITAL STRUCTURE AND OTHER RELATED ISSUES

i) Preferential issue of securities

a. In order to meet the Companys working capital requirements and for general corporate purposes, the Board of Directors, with the prior approval of the shareholders obtained through an Extraordinary General Meeting held on December 07, 2022, allotted 17,00,000 convertible share warrants on December 13, 2022. These warrants were issued at a price of Rs.278.50/- per warrant, aggregating to a total consideration of Rs.47.35 Crore to the Bodies Corporate forming part of the Promoter Group in compliance with the provisions of the Companies Act, 2013 and the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2015. Such warrants were convertible into one equity share of face value Rs.10/- within a period of 18 months from the above -said date of allotment.

b. The warrant holders exercised their right of conversion in multiple tranches. As on April 1, 2024, 3,00,000 warrants remained outstanding, which were duly converted into equity shares on May 28, 2024. Consequently, all 17,00,000 warrants have been fully converted into equity shares in accordance with the terms of the issue and applicable SEBI Regulations.

c. Details of utilization of funds in terms of Regulation 32 (7A) of the Listing Obligations and Disclosure Requirements) Regulations

Particulars	Rs In Cr
Funds raised out of the preferential issue of 17,00,000 equity shares at an issue Price of Rs.278.50 per share (A)	47.35
Funds utilization towards working capital requirements and other general corporate purposes (B)	47.35
Balance un-utilized Funds (A-B)	-

d. There has been no deviation or variation in the utilization of proceeds arising from the preferential issue of 17,00,000 share warrants, as approved by the shareholders at the Extraordinary General Meeting held on December 07, 2022. The proceeds have been applied in line with the objects stated in the Explanatory Statement annexed to the Notice of the said EGM dated November 10, 2022.

ii) Increase in the Share Capital

Consequent to the allotment of 3,00,000 equity shares of Rs.10/- each on May 28,2024 upon conversion of warrants, the issued, subscribed and paid up capital of the Company increased from Rs.17,38,27,370/- comprising of 1,73,82,737 equity shares of Rs.10/- each to Rs.17,68,27,370/- comprising of 1,76,82,737 equity shares of Rs.10/- each.

iii) Amendment to the Memorandum and Articles of Association

During the year under review, tha Company has not amended any Provisions in the Memorandum and Articles of Association.

9. CORPORATE GOVERNANCE

Pursuant to the requirements under Schedule V? of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section detailing the Corporate Governance practices followed by the Company forms part of this Annual Report. A certificate from the Companys Statutory Auditors confirming compliance with the conditions of Corporate Governance, as prescribed under the said Regulations, is also annexed to this Report and marked as Annexure -1.

10. RESERVES

The Company had not transferred any amount from the profits for the financial year 2024-25 to the General Reserve. The entire retained earnings have been carried forward and remain available for future business requirements.

11. LIQUIDITY

The Company has adequate cash and cash equivalents in its Books as at March 31, 2025 to effectively take care of all current liabilities.

12. CHANGE IN THE NATURE OF BUSINESS, IF ANY

During the year, the nature of the business of the

Company - Manufacturing of Electrical Installation Products-has not changed.

13. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year of the Company to which financial statements relate and the date of this report.

14. 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 year under review and up to the date of this Report, no significant orders have been passed by any Court in India, Tribunal, or Regulatory Authority which would impact the Companys going concern status or have a material bearing on its future operations.

15. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS.

The Company has established effective and progressive internal financial control systems to ensure operational stability, accurate financial reporting, and compliance with applicable laws. These controls are regularly reviewed, formalized into work policies, and enhanced through continuous automation efforts to improve system efficiency and reliability

Recognizing the dynamic business environment, the Company proactively identifies financial reporting risks related to major line items and establishes controls to mitigate such risks. These controls are reviewed periodically in response to changes in operations, IT infrastructure, and regulatory updates. The Corporate Accounts function is actively involved in designing and validating key process changes, including those affecting IT systems related to financial reporting.

The internal check mechanism includes routine physical verification of inventories, fixed assets, and cash on hand. No material discrepancies were observed during the year under review. Judgements and estimates used in financial statements are made using sound policies and, where appropriate, validated by external agencies. These are subject to review and approval by the Audit Committee.

The Company also maintains a robust internal audit system monitored by both Internal and External Auditors. Additionally, a Code of Conduct and a

Whistle Blower Policy are in place to promote transparency and accountability across all levels of the organization.

16. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

As at March 31,2025, your Company has following subsidiary Companies

a) Kaycee Industries Limited,

b) Salzer Kostad EV Charges Private Limited;

c) Salzer EV Infra Private Limited - Wholly Owned Subsidiary

d) Salzer Emarch Electromobility Private Limited (Step down subsidiary of Salzer EV Infra Private Limited) and

e) Salzer Electronics Arabia Limited- Wholly Owned Overseas Subsidiary

Performance Analysis of Subsidiary and Associate Entities

A) Kaycee Industries Limited

i. Kaycee Industries Limited, a subsidiary of the Company, reported a steady financial performance for the financial year ended March 31, 2025. The Company recorded revenue of Rs.53.20 crore in FY25, reflecting a 9% growth over Rs.48.81 crore reported in the previous year. Operating Profit stood at Rs.8.64 crore, a significant increase of 27% compared to Rs.6.78 crore in FY24. Net Profit (PAT) also registered a robust growth of 31%, rising to Rs.5.88 crore from Rs. 4.49 crore in the previous year.

ii. Improved operational efficiency and cost management contributed to the enhanced profitability The Operating Profit Margin improved to 16% in FY25 from 14% in FY24, while PAT Margin increased to 11% from 9% during the same period. The results underscore the subsidiarys continued focus on strengthening its core business, driving margin expansion, and maintaining consistent value creation within the group.

Iii. Kaycee delivered consistent growth over the past five years, with sales posting a 5-year Compounded Annual Growth Rate (CAGR) of 18% and Profit after Tax growing at 33% CAGR. Net worth doubled to Rs. 29.03 crore in the last five years, reflecting strong focus on efficiency, profitability, and longterm value creations.

iv. Kaycee acquired a 27% stake in October 2024 in Ultra-Fast Charges Private Limited, a Hyderabad- based start-up engaged in developing and manufacturing DC charging stations for electric cars. This transaction marks Kaycees foray into the EV space.

v. During the year, Kaycee carried out a stock split, converting one equity share of Rs.100 each into 10 equity shares of Rs.10 each. Besides, Kaycee

issued bonus shares in the ratio of 1:4, i.e., for every one equity share of Rs.10, four bonus equity shares of Rs.10 were allotted. Following the stock split and bonus issue, each original Rs.100 share effectively became 50 equity shares of Rs.10—representing a phenomenal reward in Kaycees history for its shareholders.

B) Salzer Kostad EV Charges Private Limited -Subsidiary Company

i. Salzer Kostad EV Chargers Private Limited was incorporated with the primary objective of establishing fast charging stations for electric vehicles, in collaboration with Kostad, an Austrian technology partner. However, the venture was subsequently assessed to be operationally unviable and failed to generate any economic value.

ii. Accordingly, the Board of Directors, at their meeting held on May 24, 2025, approved the writeoff of the entire equity investment of Rs.83 lakhs, representing a 67% shareholding in the said subsidiary The investment has been fully impaired during the financial year 2024-25, in accordance with the requirements of Indian Accounting Standard CInd AS) 36-Impairment of Assets.

iii. This decision reflects the Companys prudent approach to financial reporting and commitment to transparency in recognising business risks and unrealized assets.

C) Salzer EV Infra Private Limited (Wholly owned subsidiary)

i. Salzer EV Infra Private Limited, a wholly owned subsidiary of the Company, has been established as an investment vehicle to channel strategic investments into companies engaged in the electric vehicle CEV) sector and energy-related ventures. The Company made investments through Salzer EV Infra in Salzer EMarch Electromobility Private Limited, a company engaged in the manufacture of electric conversion kits for autorickshaws, cars, and buses, as well as the development of novel electric-powered utility vehicles.

ii. Furthermore, Salzer EV Infra will also serve as the investment conduit for the Companys proposed equity participation in a Special Purpose Vehicle CSPV), as detailed under Serial No. 5.a of this Report.

D) Salzer EMarch Electromobility Pvt. Ltd (Step down subsidiary)

i. The Company, through its wholly owned subsidiary Salzer EV Infra Private Limited, had formed a joint venture entity, Salzer EMarch Electromobility Private Limited, in association with EMarch LLP, with the objective of developing and manufacturing electric vehicle conversion kits for auto-rickshaws. However, the proposed project was subsequently evaluated and found to be operationally unsustainable, with no economic returns realised from the investment. Accordingly, the Board of Directors, at their meeting held on May 24, 2025, approved the write-off of the entire investment of Rs.34.75 lakhs, representing a 98.50% equity holding in the step-down subsidiary, Salzer EMarch Electromobility Private Limited.

ii. The said investment has been fully impaired in the financial year 2024-25, in accordance with the principles of Indian Accounting Standard CInd AS) 36 - Impairment of Assets, and has been appropriately accounted for in the consolidated financial statements of the Company.

E) Salzer Electronics Arabia Limited (Wholly Owned Overseas Subsidiary)

Salzer Electronics Arabia Limited was incorporated in September 2024 to establish a manufacturing facility in Saudi Arabia, aiming to serve customers and expand operations across GCC countries. Preliminary groundwork for setting up the facility is underway, marking a strategic step toward strengthening Salzers international footprint in the Middle East region.

17. DEPOSITS

During the Financial year under review, the Company has not accepted any deposits within the meaning of Section 73 of the Companies Act 2013 read with Companies (Acceptance of Deposits) Rules, 2014. As such there was no deposit outstanding as at March 31,2025.

18. STATUTORY AUDITORS

The Shareholders, at the 39th Annual General Meeting held on September 14, 2024, approved the appointment of M/s. Swamy & Ravi, Chartered Accountants (Firm Registration No. 004317S), Coimbatore, as the Statutory Auditors of the Company for a term of five consecutive years, commencing from the conclusion of the 39th Annual General Meeting until the conclusion of the 44th Annual General Meeting, covering the financial year 2028-29.

M/s. Swamy & Ravi., Chartered Accountants have furnished a certificate to the Board confirming that they are not disqualified from continuing as Auditors of the Company

19. INVESTMENTS MADE BY THE COMPANY

The Company has established adequate systems to periodically review the fair value of its investments and assess any material impact resulting from fluctuations in their valuation. These assessments are carried out in accordance with the applicable accounting standards and are appropriately reflected in the financial statements.

During the reporting period, based on such evaluations, certain investments were identified where the economic value had diminished entirely. As a result, these investments were fully written off in the books of accounts in compliance with the principles of fair value measurement and impairment under applicable Indian Accounting Standards.

Further details relating to these write-offs are provided under Serial No. 16(b) and 16(d) of this Report.

20. AUDITORSREPORT

The Independent Audit Report along with the Annexure as prescribed under Companies (Auditors Report) Order 2020 as issued by the Auditors are appended to this Annual Report. The Auditors have not made any qualification / adverse remarks.

21. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OF THE COMPANIES ACT 2013

There were no instances of fraud reported by the Auditors to the Central Government or to the Audit Committee of the Company as indicated under the provisions of Section 143 (12) of the Companies Act, 2013.

22. MAINTENANCE OF COST RECORDS UNDER SUB-SECTION (1) OF SECTION 148 OF THE COMPANIES ACT, 2013

Pursuant to the provisions of Section 148 (1) of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Company was required to maintain cost records. Accordingly, the Company has duly made and maintained the Cost Records as mandated by the Central Government.

23. EXTRACT OF THE ANNUAL RETURN

The extract of the annual return in form No. MGT - 7 forms part of the Boards report given in the companys website www.salzergroup.net in compliance with Rule 12(1) of the Companies (Management and Administration) Rules, 2014.

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

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo given as Annexure- 2 herewith separately.

25. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company has constituted a CSR Committee of the Board of Directors and has adopted a CSR Policy. The same is posted in the Companys website www.salzergroup.net A report in the prescribed format detailing the CSR expenditure for the year 2024-25 is attached herewith as Annexure-3 and forms a part of this report

26. DIRECTORS:

A. Changes in Directors and Key Managerial Personnel

i. During the Year, Mr. Sunder Rajan Raman was appointed as Independent Director effective May 28, 2024. The Board is of the opinion that the integrity, expertise and experience (including the proficiency) of Mr. Sunder Rajan Raman are satisfactory.

ii. During the year, the following Independent Directors retired from the Board effective August 08, 2024, upon completion of their two consecutive terms of five years each, in accordance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:

a) Mr. N. Rangachary

b) Mr. V Sankaran

c) Mr. P K. Shah

d) Mr. N. Jayabal and

e) Mr. Nirmal Kumar Chandria

iii. Mr. P Ramachandran, Whole-Time Director, and Mrs. Thilagam Rajeshkumar, Non-Executive NonIndependent Director, resigned from the Board effective August 08, 2024, due to their personal reason,

iv. Mr. N. Rangachary and Mr. N. Sankaran were appointed as Non-Executive Non-Independent Directors of the Company effective August 09, 2024 and Mr. N. Rangachary has been designated as the Chairman of the Company

V. Following the aforesaid changes, the Board of Directors comprises eight members, consisting of two Executive Directors, three Independent Directors, and three Non-Executive, NonIndependent Directors. The composition of the Board is in compliance with the requirements of Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

B. Retirement by Rotations

Mr. D.Rajeshkumar and Mr. D.Vishnu Rangaswamy who are the retiring Directors in the ensuing 40th Annual General Meeting, offer themselves to get re-appointed in pursuance of Section 152 of the Companies Act 2013 read with Article 178 of the Articles of Association of the Company.

C. Declaration by the Independent Directors

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015. The Board has optimum composition of the Independent and Non Independent Directors.

D. Formal Annual Evaluation

SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, mandates that the Board shall monitor and review the Board evaluation framework. The framework includes the evaluation of directors on various parameters such as: -

• Board dynamics and relationships

• Information flows

• Decision-making.

• Relationship with stakeholders

• Company performance and strategy

• Tracking Board and committees effectiveness

E. Peer evaluation

The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The evaluation process has been explained in the corporate governance report.

F. Committees of the Board.

Currently, the Board has five committees: the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, Stakeholders Relationship Committee, and the Risk Management Committee. A detailed note on the composition of the Board and its committees is provided in the corporate governance report section of this Annual Report.

27. LISTING REGULATIONS

Your Company has duly complied with various Regulations as prescribed under SEBI (Listing Obligations and Disclosure) Regulations, 2015.

28. MEETINGS

The details in respect of the Meeting of the Board of Directors, Audit Committee and all other sub Committee are given in the Corporate Governance Report.

29. WHISTLE BLOWING POLICY MECHANISM

The Company has in place a robust Whistle Blower Policy, which provides a structured mechanism for Directors and Employees to report genuine concerns regarding unethical behaviour, actual or suspected fraud, or violation of the Companys Code of Conduct and Ethics Policy.

This mechanism:

• Allows Directors and Employees to access the Audit Committee, in good faith, to report any unethical, improper, or wrongful conduct observed within the organization.

• Prohibits managerial personnel from taking any adverse personal action against employees who report concerns.

• Provides necessary safeguards to protect whistleblowers from reprisals, victimization, or unfair treatment.

The policy is applicable to all Directors and employees of the Company and reinforces the Companys commitment to transparency, integrity, and accountability.

To report any such concerns or incidents, employees and directors may directly contact or write to the Chairman of the Audit Committee at the designated email address or correspondence address provided by the Company.

Office of the Audit Committee (Compliance Officer) E-Mail : murugesan@salzergroup.com Contact No. 0422 4233614

Office of the Managing Director E-Mail : rd@salzergroup.com Contact No.0422-4233612

Office of Joint Managing Director and Chief Financial Officer

E-Mail : rajesh@salzergroup.com Contact No.0422-4233610

During the year under review, no complaint was received by the above officers under whistle blowing policy mechanism with respect to the performance of the company and other related matters.

30. PREVENTION OF SEXUAL HARASSMENT AT THE WORK PLACE

The Company has constituted an Internal Committee (IC) at all its units in accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Committee is responsible for addressing and resolving complaints related to sexual harassment reported by women employees.

This policy applies to all categories of employees, including permanent, contractual, temporary, and trainees, ensuring a safe and respectful work environment for all.

During the year under review, no complaints were received by the Internal Committee.

The Company remains committed to upholding the dignity of every individual and maintaining a workplace free from discrimination and harassment.

31. NOMINATION AND REMUNERATION COMMITTEE

The purpose of the committee is to screen and to review individuals qualified to serve as executive

directors, non-executive directors and independent directors, consistent with policies approved by the Board, and to recomend, for approval by the Board, nominees for election at the AGM.

The committee also makes recommendations to the Board on candidates for

(i) nomination for election or re-election by the shareholders and

(ii) any Board vacancies that are to be filled.

It also reviews and discusses all matters pertaining to candidates and evaluates the candidates. The nomination and remuneration committee coordinates and oversees the annual selfevaluation of the Board and of individual directors.

The nomination and remuneration committees charterand policy are available on our website.

32. POLICY ON THE DIRECTORS APPOINTMENT AND REMUNERATION

As of March 31, 2025, the Board of Directors of the Company comprises eight members, including two Executive Directors, three Non-Executive, Non-Independent Directors, and three Independent Directors, one of whom is a Woman Independent Director.

The composition of the Board is in compliance with the requirements of Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and reflects a balanced blend of executive and non-executive leadership.

The Company follows its Nomination and Remuneration Policy, formulated in accordance with Section 178(3) of the Companies Act, 2013, which outlines the criteria for appointment, qualifications, and remuneration of Directors and Key Managerial Personnel. The policy is available on the Companys website for reference by stakeholders.

We affirm that the remuneration paid to the Directors during the year is in accordance with the terms and conditions laid out in the said policy

33. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review,

• The Company has not granted/taken loans, unsecured, from or to Companies, firms or other parties, listed in the Register maintained under section 189 of the Companies Act, 2013 (the Act).

• The investments in other bodies corporate are well within the limit as prescribed under Section 186 of the Companies 2013.

34. RELATED PARTY TRANSACTIONS

All the transactions of the Company with related parties are at arms length and have taken place in the ordinary course of business. None of the transactions with related parties is a material transaction. Since there are no transactions that are not in arms length and material in nature, disclosure under AOC 2 does not arise. The Board approved Related Party Transaction Policy is available at the Companys website www.salzergroup.net

35. INSIDER TRADING

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended, the Company has adopted a comprehensive Code of Conduct to Regulate, Monitor and Report Trading by Insiders. This Code is strictly adhered to by all Designated Persons (DPs) while dealing in the Companys securities beyond the defined threshold limits.

The Company also maintains a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI), ensuring transparent and timely disclosure.

A structured system is in place for tracking trading activities of DPs and their immediate relatives. The trading window remains closed from the end of each financial quarter until 48 hours after the public disclosure of financial results or other UPSI. DPs are regularly advised not to trade during this period. Additionally, the trading window is closed in connection with Board meetings considering UPSI, and demat accounts of relevant DPs are frozen in line with SEBI circulars.

Further, a Structured Digital Database (SDD) has been installed for effective implementation of the practices.

36. MANAGERIAL REMUNERATION

The Company has employed individuals whose remuneration falls within the purview of the limits prescribed under the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Details pursuant to section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report and are annexed herewith as Annexure - 4.

37. SECRETARIAL AUDIT REPORT

In accordance with Section 204 of the Companies Act, 2013, the Board of Directors, at their meeting held on May 28, 2024, appointed Mr. G. Vasudevan, B.Com, LLB, FCS, of M/s. G V Associates, Company Secretaries (Certificate of Practice No. 6522), as the Secretarial Auditor to carry out the audit of secretarial records for the financial year 2024-25, 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 for the financial year ended March 31,2025, is provided in Annexure - 5 to this report.

The report confirms the Companys compliance with the applicable provisions of the Act, Rules, Regulations, Guidelines, and Standards, with the exception of an observation noting two instances of delayed disclosures made to the Stock Exchange

1. The due date for submission of the certificate under Regulation 7(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, for the financial year ended 31.03.2024 was

30.04.2024. However, the Company submitted the said certificate to Bombay Stock Exchange on

25.07.2024, resulting in a delay of 2 months and 25 days &

2. The due date for submission of the certificate under Regulation 24A of Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulation, 2015 for the financial year ended 31.03.2024 was 30.05.2024. However, the listed entity submitted the certificate in PDF format to Bombay Stock Exchange on 14.06.2024, resulting in a delay of 14 days. The Company has provided an appropriate explanation to the Bombay Stock Exchange for the delay and has paid a fine of Rs 35,400/- as levied by the Bombay Stock Exchange

The Board Comments: The aforesaid delays were caused by intermittent technical glitches during the filing process of relevant disclosures. The Management has been advised to exercise more diligence in future for timely filing and better compliance."

38. COMPLIANCE ON SECRETARIAL STANDARDS

The Company complies with all applicable mandatory secretarial standards issued by the Institute of Company Secretaries of India.

39. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In accordance with the applicable provisions of the Companies Act, 2013, and the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 C"IEPF Rules"), all unpaid or unclaimed dividends must be transferred by the Company to the Investor Education and Protection Fund CIEPF), established by the Government of India, after a period of seven years from the due date of transfer.

Additionally, as per the IEPF Rules, shares on which dividend has not been paid or claimed for seven consecutive years or more are also required to be transferred to the demat account of the IEPF Authority.

During the year, the Company transferred unclaimed and unpaid dividends amounting to Rs. 4,49,883/-. Further, 9232 shares, corresponding to such unclaimed dividends for seven consecutive years, were also transferred as mandated under the IEPF Rules. Detailed information is available on our website: www.salzergroup.net.

40. RISK MANAGEMENT POLICY

Risk management entails the identification and mitigation of potential threats that may significantly disrupt or adversely affect the organization. This process generally involves analyzing the companys operations, recognizing potential risks, evaluating their likelihood, and implementing appropriate strategies to minimize those deemed most probable.

To address such risks that may arise during the course of business, the Board of Directors has constituted a Risk Management Committee. The primary purpose of this committee is to identify threats that may impede the companys growth and to formulate strategic plans to manage and mitigate such risks effectively.

Accordingly, the operational management conducts regular assessments of the companys risk profile, focusing on risks that could impact business performance. These reviews are carried out in alignment with the organizations Risk Management Policy and in compliance with relevant regulatory guidelines.

41. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

In terms of the provisions of Regulation 34 of the Securities and Exchange Board of India [Listing Obligations and Disclosure Requirements) Regulations, 2015, the Managements discussion and analysis is set out in this Annual Report as Annexure- 6.

42. COST AUDITOR

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies [Cost Records and Audit) Amendment Rules, 2014, the Directors, on the recommendation of the Audit Committee and subject to the approval of the Members, have appointed CMA Mr.A.R.Ramasubramania Raja, Practicing Cost and Management Accountant, as the Cost Auditor of the Company for the Financial Year 2024-25 to conduct the audit on the Maintenance of Cost Records of the Company and submit the report to the Central Government with the due approval of the Board of Directors within the stipulated time.

43. POLICIES OF THE COMPANY

The Company is committed to good corporate governance and has consistently maintained its organizational culture as a remarkable confluence of high standards of professionalism and building shareholder equity with principles of fairness, integrity and ethics.

The Board of Directors of the Company have from time to time framed and approved various Policies as required by the Companies Act, 2013 read with the Rules issued thereunder and the Listing Regulations. These Policies and Codes are reviewed by the Board and are updated, if required.

Some of the key policies adopted by the Company are as follows:

a) Policy on Materiality of Related Party Transactions

b) Corporate Social Responsibility Policy

c) InsiderTrading Policy

d) Nomination and Remuneration Policy

e) Policy on Related Party Transactions

f) Risk Management Policy

g) Policy on prevention of sexual harassment at workplace

h) Whistle Blower Policy

I) Policy on payment of remuneration to NonExecutive Directors

j) Policy on Familiarization Program for the NonExecutive Directors

k) Policy on Determination of materiality of events/ information

l) Policy for Preservation of Records

m) Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

n) Policy on Subsidiary & Material Subsidiary Company

44. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your Directors hereby confirm that:

• In the preparation of the annual financial statements for the year ended March 31, 2025, the applicable accounting standards have been followed, along with proper explanations for any material departures, if any;

• Appropriate accounting policies have been consistently applied, and reasonable and prudent judgments and estimates have been made, so as to present a true and fair view of the state of affairs of the Company as on March 31, 2025, and of the profit and loss for the financial year ended on that date;

• Proper and sufficient care has been taken for the maintenance of adequate accounting records in compliance with the provisions of the Companies Act, 2013, for safeguarding the assets of the

Company and for preventing and detecting fraud and other irregularities;

• The annual financial statements have been prepared on a going concern basis;

• The Company has laid down adequate internal financial controls, and such controls were operating effectively throughout the year;

• Proper systems have been put in place to ensure compliance with all applicable laws, and these systems are adequate and functioning effectively

45. CREDIT RATINGS

During the year under review, the credit ratings have reaffirmed as CRISIL A/Stable for long term borrowing and CRISIL A1 for short term borrowings.

46. INDUSTRIAL RELATIONS

During the year under review, industrial relations at all the Companys units have continued to remain cordial and peaceful.

47. DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 DURING THE YEAR ALONG WITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR

Not Applicable

48. DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

Not Applicable

49. CAUTIONARY STATEMENT

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis, describing the Companys objectives, projections, estimates and expectations, may constitute forward looking statements within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ.

50. ACKNOWLEDGEMENTS

We sincerely thank our shareholders, government agencies, bankers, customers, suppliers, and all stakeholders for their steadfast support. We also recognize and appreciate the dedication of our employees at every level.

	For and on behalf of the Board
	N RANGACHARY
Place : Coimbatore	CHAIRMAN
Date : May 24, 2025	DIN : 00054437