Sedemac Mechatronics Ltd Directors Report

To The Members of SEDEMAC Mechatronics Limited (Formerly SEDEMAC Mechatronics Private Limited)

Your Directors have immense pleasure in presenting the 19th Annual Report of your Company on the business and operations of SEDEMAC Mechatronics Limited (the "Company"), together with the audited financial statements for the financialyearended31 significant increase in st March, 2026.

1. Financial and Operational Highlights

Particulars	FY 25-26	FY 24-25
Revenue from operations	1,058.38	658.36
Other income	5.27	4.17
Total income	1,063.65	662.53
Cost of material consumed	645.81	410.65
Employee benefits expense	86.61	61.43
Other expenses	109.03	65.39
Finance costs	8.53	12.03
Depreciation and amortization expense	63.48	45.33
Total expenses	913.46	594.83
Profit before tax	150.19	67.70
Less Total Tax expenses	46.61	20.65
Profit for the year	103.58	47.05
Other comprehensive income for the year	(0.29)	(0.50)
Total comprehensive income for the year	103.29	46.55
Earnings per share (Basic)	23.91	10.93
Earnings per share (Diluted)	23.52	10.82

2. Dividend

Considering the necessity of conserving resources for the future growth and expansion of the Company, the Board of Directors do not recommend payment of dividend on the Equity

Shares of the Company for the financial year ended 31 ^st March 2026.

3. Transfer of unclaimed dividend to Investor Education and Protection Fund

The Company has not declared any dividend in the past and hence there is no unclaimed amount required to be transferred to the investor education and protection fund.

4. State of Companys Affairs

During the financial year under review, your Company continued its growth trajectory and delivered a strong operational performance. The Company sold 3,901,075 Control-Intensive

ECUs during the year as against 2,438,518 Control-Intensive ECUs in the previous financial year, registering a robust year-on-year growth of 60%.

volumes reflects the Companys strong market position, The sustained customer demand, and continued focus on innovation and operational excellence. The performance underscores the Companys ability to capitalize on growth opportunities while strengthening its presence across key market segments.

The financial year under review marked a significant milestone in the history of your

Company with the successful completion of its Initial Public Offering ("IPO"). The IPO comprised an Offer for Sale of 8,043,300 Equity Shares of Face Value INR 10 each by certain existing shareholders, aggregating to INR 1,087.35 Crores.

Your Companys equity shares were successfully listed on the National Stock Exchange of India Limited and BSE Limited on 11^th March, 2026. The listing represents an important step in the Companys growth journey, enhancing its visibility, corporate governance framework, and access to capital markets while creating long-term value for all stakeholders.

5. Share Capital

A. Authorised Share Capital

The Company at its Extraordinary General Meeting held on 29^th May, 2025 vide ordinary resolution increased the authorised share capital of the Company from INR 2,000,000 (Rupees Twenty Lacs Only) to INR 500,000,000 (Rupees Fifty Crores Only) divided into 50,000,000 Equity Shares of INR 10 each.

B. Issued, Subscribed and Paid-Up Share Capital

As on 31^st March, 2026, the issued, subscribed and paid-up share capital of your Company stood at INR 441,615,000 divided into 44,161,500 Equity Shares of face value of INR 10 each.

Details of issuance of Equity Shares by the Company during the financial year under review are given hereunder:

i. The Company allotted 220 (Two Hundred and Twenty) convertible warrants on a preferential basis convertible at the option of the respective Warrant Holders, in one or more tranches, into a total number of 220 (Two Hundred and Twenty) equity shares of the Company bearing face value of INR 10 each ("Equity Shares"), with each Warrant convertible into one Equity Share, for cash consideration.

ii. The Company allotted 220 Equity Shares upon conversion of warrants. iii. On September 22, 2025, the Company allotted 43,569,934 (Four Crores Thirty Five Lakhs Sixty Nine Thousand Nine Hundred and Thirty Four) Bonus Equity Shares of INR 10 each to equity shareholders in the ratio of 1499:1 i.e. 1499 bonus Equity Shares for every 1 Equity Share held. iv. The Company allotted 1,371,000 (Thirteen Lakhs Seventy One Thousand) Equity Shares of INR 10 each on exercise of stock options (ESOPs) pursuant to the Companies (Share Capital and Debentures) Rules, 2014

Company has neither issued Equity Shares with Duringthefinancial differential voting rights nor issued sweat equity shares in terms of the Companies Act, 2013

6. Subsidiaries, Joint Ventures & Associate Companies

The Company does not have any subsidiaries, joint ventures, or associate companies.

Hence, a separate section on the performance and financial position under the provisions of Section 129(3) of the Companies Act, 2013, is not applicable to the Company.

The Companys Policy for determining Material Subsidiaries is available on the website at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

7. Management Discussion and Analysis

A detailed analysis of your Companys performance is discussed in the Management Discussion and Analysis Report for the Financial Year 2025-26, pursuant to the provisions of Regulation 34(2)(e) and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), forming an integral part of this Annual Report.

8. Corporate Governance

Your Company is committed to maintaining high standards of corporate governance and ethical conduct. The Board of Directors, supported by its Committees, provides effective strategic oversight and supervision to the management, internal control systems, risk management and legal compliances across the Company.

The report on the Corporate Governance as stipulated in Regulation 34 of the Listing

Regulations along with a Certificate from the Chartered Accountant regarding compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulations forms integral part of this Board Report.

The Certificate on Corporate Governance of the Company obtained from M/s. B S R & Co.

LLP, Chartered Accountants, as required under the Listing Regulations, is annexed with the Corporate Governance Report.

9. Directors and Key Managerial Personnel

i. Board Diversity

The Company believes that diversity on the Board is essential for effective functioning, sound decision making and strong corporate governance. An appropriately diverse Board brings together varied perspectives, experience and expertise, which enhances the quality of discussions and strategic oversight. In determining the composition of the Board, due consideration is given to a range of factors including professional background, skills, experience, independence and gender, while ensuring an effective balance between executive and non-executive directors. The Company remains committed to maintaining a Board composition that reflects diversity of thought and supports the long-term interests of the Company and its stakeholders.

The Policy to promote diversity on the Board of Directors (Board Diversity Policy) is adopted by the Board, in compliance with Regulation 19(4) read with Part D of the Schedule II of the Listing Regulations.

The Board Diversity Policy is available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

ii. Board of Directors

As on 31^st March, 2026, the Board comprised 6 (Six) Directors, including 3 (three) Executive Directors, 2 (two) Non-Executive Independent Directors and 1 (one) Non-Executive Director.

The brief profile of each director is available on the website of the Company at https://www.sedemac.com/investors/board-of-directors-management-team

The Board is of the opinion that the Independent Directors of the Company (including those appointed/re-appointed during the year) possess requisite qualifications, experience, expertise, proficiency and hold highest standards of integrity. In terms of the requirements under the Listing Regulations, the Board has identified key skills, expertise and core competencies required for appointment of director on the Board, including Independent Directors, details of which are provided as part of the Corporate Governance Report forming part of this Report.

The Composition of the Board of Directors as on 31^st March, 2026 is detailed below:

Name of Director	DIN	Designation
1. Mr. Shashikanth Suryanarayanan	01269904	Managing Director
2. Mr. Amit Arun Dixit	01288169	Joint Managing Director
3. Mr. Manish Sharma	01310490	Whole-Time Director & Chief Operating
4. Mr. Namakal Srinivasan Parthasarathy	00146954	Non-Executive Independent Director
5. Ms. Poyni Bhatt	09052397	Non-Executive Independent Director
6. Mr. Udo Edgar Wolz	11142797	Non-Executive Director

Below were the changes in the Board of Directors during the financial year 2025-26

• Mr. Manish Sharma (DIN: 01310490) was appointed as Additional Director and further appointed as Whole-Time Director for a period of 3 (Three) years with effect from 14^th May, 2025.

• The Members of your Company, in the Extra-Ordinary General Meeting held on 29^th May, 2025, re-designated Mr. Shashikanth Suryanarayanan (DIN: 01269904) as Managing Director, subject to approval of the central government. Central Government has approved his appointment as Managing Director vide its approval letter dated 28^th August, 2025.

• The Members of your Company, in the Extra-Ordinary General Meeting held on 29^th May, 2025, re-designated Mr. Amit Dixit (DIN: 01288169) as Joint Managing Director, appointed Mr. Manish Sharma (DIN: 01310490) as Whole Time Director.

• The Members of your Company, in the Extra-Ordinary General Meeting held on 29^th May, 2025, appointed Mr. Namakal Srinivasan Parthasarathy (DIN: 00146954) and Ms. Poyni Bhatt (DIN: 09052397) as Independent Directors of the Company.

• The Members of your Company, in the Extra-Ordinary General Meeting held on 23^rd June, 2025, appointed Mr. Udo Edgar Wolz (DIN: 11142797) as a Non-Executive Director of the Company with effect from 1^st July, 2025.

• Mr. Bhavya Kapoor (DIN: 06686157) resigned as Director with effect from 17^th October, 2025.

• Mr. Abhay Pandey (DIN: 01650845) resigned as Director with effect from 17^th October, 2025.

• Ms. Poyni Bhatt, Non-Executive Independent Director, was appointed as Chairperson of the Company with effect from 1^st November, 2025.

iii. Key Managerial Personnel (KMPs)

In accordance with the provisions of Sections 2(51) and 203 of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are the Key Managerial Personnel of the Company:

Name	Designation
1. Mr. Shashikanth Suryanarayanan	Managing Director
2. Mr. Amit Arun Dixit	Joint Managing Director
3. Mr. Manish Sharma	Whole-Time Director & Chief Operating Officer
4. Mr. Rajesh Madhukar Sheth	Chief Financial Officer
5. Mr. Prasad Rajendra Chavan	Company Secretary&ComplianceOfficer

Below were the changes in the Key Managerial Personnel during the financial year 2025-26

• Mr. Manish Sharma (DIN: 01310490) was appointed as Whole-Time Director for a period of 3 (Three) years with effect from 14^th May, 2025.

• Mr. Rajesh Sheth was appointed as Chief Financial Officer of the Company with effect from 14^th May, 2025

• Mr. Prasad Chavan was appointed as Company Secretary and Compliance Officer of the Company with effect from 14^th May, 2025.

iv. Retirement by rotation and subsequent re-appointment

Mr. Manish Sharma (DIN: 01310490), Whole-Time Director of the Company liable to retire by rotation at the ensuing AGM and, being eligible, has offered his candidature for reappointment.

As per the provisions of the Act, the Independent Directors are not liable to retire by rotation.

10. Independent Directors

i. The Company has received declarations from each of the Independent Directors that he/she meets the criteria of independence as laid out in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations.

ii. The Board of Directors is of the opinion that all the Independent Directors meet the criteria regarding integrity, expertise, experience and proficiency.

iii. In terms of Regulation 25(8) of Listing Regulations, all 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.

In the opinion of the Board, there has been no change in the circumstances affecting their status as Independent Directors of the Company and the Independent Directors are persons of high repute, integrity and possess relevant expertise and experience in the respective fields. Further, in terms of Section 150 read with Rule 6 of the Companies (Appointment & Qualification of Directors) Rules, 2014, as amended, the Independent

Directors of the Company have registered their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

iv. During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company. Further, Independent Directors had no pecuniary relationship or transactions with the Company, other than sitting fees. Further, they are entitled to receive commission/remuneration as per the provisions of Section II of Part II of Schedule V of the Act for the FY 2025-26. During the year under review, the Company also paid remuneration to its Non-Executive Director in accordance with the applicable provisions of the Companies Act, 2013.

11. Remuneration of Directors, Key Managerial Personnel and Senior Management

The remuneration paid to the Directors, Key Managerial Personnel and Senior Management is in accordance with the Nomination and Remuneration Policy of the Company formulated in accordance with Section 178 of the Act and Regulation 19 read with Schedule II of the Listing Regulations. Details of the same are given in the Corporate Governance Report, which forms part of this Board Report.

The Nomination and Remuneration Policy of the Company is available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

12. Disclosure under Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

The percentage increase in remuneration, ratio of remuneration of each Director and Key Managerial Personnel ("KMP") to the median of employees remuneration, as required to be disclosed under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are provided in Annexure A which is forming part of this Board Report.

The statement containing particulars of employees, as required under Section 197 of the Act, read with rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. However, the Integrated Annual Report is being sent to the shareholders and others entitled thereto, excluding the said annexure, which is available for inspection by the shareholders at the Registered Office of your Company during business hours on working days of your

Company. If any shareholder is interested in obtaining a copy thereof, such shareholder may write to the Company Secretary & Compliance Officer of the Company atcs@sedemac. com.

13. Board and Committee Performance Evaluation

The NRC laid down the criteria for evaluating the performance of every Director, Committees of the Board and the Board as a whole.

i. Boards Performance Evaluation

The evaluation of individual Directors was based on criteria such as personal attributes, participation and preparedness, availability, ethics, integrity, governance, understanding of business, corporate governance, value addition etc. Further, the evaluation of Executive Directors included additional criteria like achievement of targets set by Board and execution of plan, information sharing, leadership skills, relationship with other Board members and all the stakeholders.

ii. Committee Performance:

The performance of various Board committees established for specific purposes was assessed.

14. Familiarisation Programme for Independent Directors

The Company has designed a familiarisation programme for its Independent Directors, which is conducted at the time of the appointment of an Independent Director on the Board as well as during the year. The programme aims to provide insights about the Company to enable the Independent Directors to understand its business in depth and to assist them in performing their role as Independent Director of the Company.

The familiarisation programme, inter alia, includes briefingon:

a. Business overview b. Plant and R&D unit visits c. Corporate presentation explaining the business and business model of the Company. d. Products and technology overview. e. Matters relating to governance. f. Financial status and accounting practices overview

Through one-to-one interaction with the management, the new independent directors are acquainted with the Companys business, industry, and key policies followed by site visits to Company facilities.

Independent directors receive regular updates on the companys performance, strategic initiatives, and industry trends. Further, participation in board and committees meetings allow independent directors to engage with the companys operations and contribute to strategic discussions including update on performance, financial update, operational update, technology update, business development update.

The details of the training and familiarisation program are also available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/disclosures

15. Disclosure on Companys Policy on Directors Appointment and Remuneration as per Section 178 of the Act

The Nomination and Remuneration Policy (NRC Policy) of the Company has been adopted by the Board. The NRC Policy sets out detailed procedure of appointment along with the criteria to pay equitable remuneration to the Directors, KMPs and other employees of the Company.

This Policy is available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

16. Disclosure on Employee Stock Option Plan (ESOP)

The Company has adopted and implemented two ESOP policies.

- SEDEMAC Employee Stock Option Plan 2014

- SEDEMAC Mechatronics Employee Stock Option Scheme - 2025

16.1 SEDEMAC Employee Stock Option Plan 2014

This policy was adopted by the Board of Directors ("Board") at its meeting held on March 06, 2014 and approved by the members by passing the special resolution at its extraordinary general meeting held on 25^th March, 2014.

This policy was subsequently amended from time to time and finally, to align with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity)

Regulations, 2021 ("SBEB & SE Regulations"), it was amended during FY 2025-26.

Grant of Options under the SEDEMAC Employee Stock Option Plan 2014

During the financial year under review, there were no stock options granted.

Allotment pursuant to exercise of Vested Options under SEDEMAC Employee Stock Option Plan 2014

During the financial year under review, your Company has allotted 1,371,000 (Thirteen

Lakhs Seventy One Thousand only) equity shares of the Company having face value of INR 10 (Indian rupees ten only) each fully paid up to the eligible employee of the Company upon exercise of vested options, as granted to them from time to time.

16.2 SEDEMAC Mechatronics Employee Stock Option Scheme - 2025

This policy was adopted by the Board of Directors ("Board") at its meeting held on 21^st May, 2025 which was duly approved by the Members vide their special resolution dated 29^th May, 2025 and further amended on 10^th September, 2025 prior to Companys initial public offer ("IPO").

Grant of Options under the SEDEMAC Mechatronics Employee Stock Option Scheme - 2025

During the financial year under review, the Board of Directors of the Company, granted

244,500 (Two Lakhs Forty Four Thousand Five Hundred only) Stock Options to the Eligible Employees of the Company on 3^rd October, 2025 under this scheme.

Disclosures as required under Rule 12 of Companies (Share Capital and Debentures)

Rules, 2014, Securities and Exchange Board of India (Share Based Employee Benefits

Sweat Equity) Regulations, 2021, read with SEBI Circular CIR/CFD/POLICY CELL/2/2015 dated 16^th June, 2015 is available on the website of the Company at www.sedemac.com/investor/ESOP-disclosure-FY26.pdf

The certificate from the Secretarial Auditors that the ESOP has been implemented in accordance with Securities and Exchange Board of India (Share Based Employee and Sweat Equity) Regulations, 2021 and the resolutions passed by the shareholders shall be available at the Annual General Meeting for inspection by the members.

17. Particulars of loans, guarantees or investments made under Section 186 of the Act.

During the year under review, your Company has not given any loans or guarantee and not made any investment pursuant to Section 186 of the Act and Schedule V of the Listing Regulations. Accordingly, the disclosures required under Section 134(3)(g) of the Companies Act, 2013 are not applicable.

18. Dividend Distribution Policy

The Company has formulated and published a Dividend Distribution Policy, which provides for the parameters to be considered for declaring/ recommending dividend, circumstances under which the shareholders may, or may not expect dividend. The policy is available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

19. Succession Planning

The Company has implemented a well-structured succession planning for the Board members, Key Managerial Personnel, Senior Management and key employees of the Company.

The Succession Policy of the Company, as approved by the Board of Directors of the Company, is available on the website of the Company at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

20. Material Changes and Commitment Affecting the Financial Position of the

Company that occurred between the End of the Financial Year to which these Financial

Statements relate and the Date of the Report

There were no material changes and commitments affecting the financial position of the Company that has occurred since the end of the financial year till the date of this report.

21. Related Party Transactions

There were no transactions entered into by the Company during the financial year review with related parties except remuneration to the Directors and KMPs. The details are provided in Note No. 42 to the financial statements of the Company.

During the financial year under review, there were no transactions for which consent of the Board was required to be taken in terms of Section 188(1) of the Act and accordingly, no disclosure is required in respect of the related party transactions in Form AOC-2 under Section 134(3)(h) of the Act and rules framed thereunder.

The Company has a comprehensive policy in place on Related Party Transactions, formulated and adopted by the Company in accordance with the applicable laws, which is available at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

22. Number of Meetings of the Board

During the year under review, 14 (Fourteen) meetings of the Board of Directors were held. The details of the meetings of the Board of Directors held and attended by the Board the fees of Directors during the Financial Year 2025-26 has been provided in the Corporate Governance Report.

23. Auditors and Audit Report

i. Statutory Auditors and Audit Report

Pursuant to the provisions of section 139 of the Companies Act, 2013, M/s. B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022) were appointed as Statutory Auditors of the Company for a period of 5 (five) consecutive years to hold office from the conclusion of 18^th Annual General Meeting till the conclusion of 23^rd Annual General Meeting of the Company.

The Statutory Auditors Report on Financial Statement for Financial Year 2025-26, does not contain any qualification, reservation, adverse remarks or observation and the same forms part of this Annual Report.

ii. Secretarial Auditors & Secretarial Audit Report

Pursuant to the provisions of Regulation 24A of the Listing Regulations and Section 204 of the Act, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors, at its meeting held on 18^th May, 2026, based on the recommendation of the Audit Committee, has recommended to the shareholders the appointment of M/s. Nilesh Shah & Associates, Practising Company Secretaries (Firm registration number: P2003MH008800), a Peer Reviewed Firm (Review No. 7810/2026), as the Secretarial Auditors of the Company for a first term of 5 (five) consecutive years from Financial Year 2026-27 to Financial Year 2030-31.

The Secretarial Auditors Report issued by M/s. Nilesh Shah & Associates in Form MR-3 for the Financial Year 2025-26 does not contain any qualification, reservation or adverse remark and is annexed to this Board Report as Annexure - B

iii. Annual Secretarial Compliance Report

As per Regulation 24A(2) of the Listing Regulations, the Secretarial Auditors of the Company has provided the report on the applicable compliances of the Company for the Financial Year 2025-26. The Annual Secretarial Compliance Report obtained from the Secretarial Auditor of the Company has been submitted to the Stock Exchanges and is available on the website of the Company at https://www.sedemac.com/investors/announcements

iv. Cost Auditor & Cost records

As per the Section 148 of the Act and Cost (Records and Audit) Rules 2014, the Company is required to maintain cost audit records and undertake the cost audit. Therefore, the Board of Directors of the Company, based on the recommendation of the Audit Committee at its meeting held on 25^th August, 2025 appointed M/s. A. J. Paranjape & Co, Cost Accountants (Firm Registration No. 100480), as the Cost Auditors of the Company for the Financial Year the Cost Auditor in 18 2025-26andthe shareholders of the Company ratified th

Annual General Meeting of the Company held on 3^rd September, 2025.

During the Financial Year, the Cost Auditors of the Company provided the Cost Audit report for the Financial Year 2024-25 in Form CRA-3 and the Company has filed the Cost Audit

Report with the Ministry of Corporate Affairs in Form CRA-4 within the prescribed time.

The Cost Audit Report for the Financial Year 2024-25 does not contain any qualification, reservation or adverse remark.

Further, based on the recommendation of the Audit Committee at its meeting held on 15^th May, 2026 and the Board of Directors at its meeting held on 18^th May, 2026 appointed M/s. A. J. Paranjape & Co, Cost Accountants (Firm Registration No. 100480) as the Cost Auditors of the Company for the Financial Year 2026–27 under Section 148 of the Companies Act, 2013. M/s. A. J. Paranjape & Co, Cost Accountants (Firm Registration No. 100480), being eligible, have consented to act as the Cost Auditors of the Company.

The remuneration proposed to be paid to the Cost Auditors for the Financial Year 2026-27, is subject to ratification by the Membersattheensuing19 ^th Annual General Meeting.

v. Internal Auditors

The Board of Directors, in their meeting held on 18^th May, 2026, has appointed M/s. Manubhai & Shah LLP., Chartered Accountants (Firm Registration No. 106041W/W100136), as Internal Auditors of the Company for the Financial Year 2026-27.

24. Internal Financial Controls and Internal Audit

The Company has an adequate system of internal controls commensurate with its size and scale of operations, procedures and policies, ensuring orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

The Company had appointed M/s. Doshi R C & Co, Chartered Accountants as Internal

Auditors of the Company for the financial year 2025-26.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Audit Committee is periodically apprised of the internal audit findings and corrective actions are taken Significant audit observations and corrective accordingly. actions taken by the management are presented to the Audit Committee.

25. Reporting of Fraud

During the financial year under review, none of auditors have identified and reported any instances of fraud committed in the Company by its officers or employees as specified under the provisions of Section 143 (12) of the Act.

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

The information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134 (3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is provided in the Annexure - C forming part of this Board Report.

27. Corporate Social Responsibility

Your Company remains deeply committed to conducting its business in a socially responsible, sustainable and ethical manner. The CSR activities of the Company are guided by its CSR Policy, approved by the Board, which lays down the governance framework, focus areas, implementation mechanism and monitoring process in accordance with the provisions of section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

Overview of CSR implementation is provided by the CSR Committee of the Board, which periodically reviews progress of ongoing projects and ensures that CSR philosophy is integrated with the Companys core values.

CSR projects are implemented through eligible implementing agencies, with due diligence and monitoring mechanisms in place to ensure transparency, accountability and effective utilisation of funds.

The Company affirms that the CSR activities undertaken during the year were in compliance with the CSR Policy and applicable statutory requirements. Detailed disclosures regarding CSR Committee composition, prescribed and actual expenditure, ongoing projects and other particulars as required under the Act and Rules are provided in Annexure - D to this Report

The detailed terms of reference of the CSR Committee, attendance at its meetings and other details have been provided in the Corporate Governance Report.

The Company has a CSR policy under Section 135 of the Act. The CSR Policy of the Company is available on its website at https://www.sedemac.com/investors/corporate-governance/codes-and-policies

28. Risk Management Policy

Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of Listing Regulations, the Company has formulated and adopted a Risk Management policy with an objective of identification and categorisation of potential risks, its assessment and mitigation and to monitor these risks.

The Board has entrusted the Risk Management Committee (RMC) with overseeing the processes of identification, evaluation, management and mitigation of risks. The RMC inter alia, periodically reviews the organisational risks that are spread across operational, financial, technological and environmental spheres and provides guidance to the management team.

The Risk management policy is available on the website of the Company at https://www. sedemac.com/investors/corporate-governance/codes-and-policies

The company conducted Risk Assessment Survey during the period from 1^st May, 2026 to 8^th May, 2026, covering an identifiedset of key business risks. Invitations were extended to select buy-side institutional investors and sell-side analysts, including Domestic Institutional

Investors (DIIs), Foreign Institutional Investors (FIIs) and significant pre-IPO investors of the Company. The survey was conducted primarily in anonymous mode to encourage independent and candid feedback.

The results of the survey were submitted to the stock exchanges. The said survey is available on the website of the Company at https://www.sedemac.com/investors/announcements

29. Whistle Blower/Vigil Mechanism

The Company has a Vigil Mechanism in place through its Whistle Blower Policy, enabling directors, employees and other stakeholders, who partner with us in our organisational objectives, to report genuine concerns relating to unethical behaviour, misconduct, actual or suspected fraud, or violation of the Companys Code of Conduct and policies. The Vigil

Mechanism provides for a secure and confidential reporting framework and adequate safeguards against victimisation of individuals who avail the mechanism in good faith.

The Audit Committee oversees the implementation and effectiveness of the Vigil Mechanism and reviews complaints received, if any, and appropriate actions taken thereon. The Whistle Blower Policy is available on the website of the Company at https://www.sedemac.com/ investors/corporate-governance/codes-and-policies

The Company continues to uphold high standards of ethics, integrity and transparency through effective implementation of the Vigil Mechanism. A quarterly report on the whistle-blower complaints, as received, is placed before the Audit Committee for its review.

30. Annual Return

In accordance with the provisions of Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company, for the Financial Year 2025-26, in the Form MGT-7 will be available at https://www.sedemac.com/investors/financial-performance

31. Committees of Directors

The details of the powers, functions, composition, meetings and attendance of all the Committees of the Board held during the year under report are given in the Report on Corporate Governance.

32. Details of significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Companys operations in future

During the financial year under review, no significant and material order was passed by any regulator or court or tribunal, which may impact the ‘going concern status and Companys operations in future.

33. Policy on Prevention of Sexual Harassment of Workmen at Workplace (Prevention, Prohibition & Redressal) Act, 2013.

The Company is committed to provide a safe, inclusive and respectful work environment for all its employees, associates, contract workers, probationers, temporary employees, trainees, apprentices of the Company and any person visiting the Company at its office.

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (‘POSH Act), the Company has formulated a comprehensive gender-neutral Policy for Prevention of Sexual Harassment at Workplace (‘POSH Policy).

InternalCommittees("IC")havebeenconstitutedtoredresscomplaintsofsexualharassment, at all the locations of the Company. The Company has complied with the provisions relating to the constitution of IC under the Act. More than half of the total members of the IC are women. The external members with requisite experience in handling such matters are also part of the IC. The IC is presided over by a senior woman employee in each case. Inquiries are conducted and recommendations are made by the IC at the respective locations. All complaints are handled with due sensitivity, confidentiality, and within prescribed timelines.

During the year under reporting, the Company complied with all provisions of the said Act. Following is the summary of complaints received and disposed of during the year:

Number of complaints received:	01
Number of complaints disposed:	01
Number of complaints withdrawn:	Nil
Number of complaints pending:	Nil

34. Compliance with Secretarial Standards

During the year, the Company have complied with all the applicable provisions of mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.

35. General Disclosures

During the year, there were no transaction requiring disclosure or reporting in respect of matters relating to:

a. Pendency of any proceeding under the Insolvency and Bankruptcy Code, 2016; b. Any instance of one-time settlement with any bank or financial institution; c. Change in the nature of business of the Company; and d. Acceptance of deposits within the meaning of Sections 73 and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

36. Compliance with Maternity Benefit Act, 1961

During the financial year under review, the Company has ensured compliance with the provisions of the Maternity Benefit Act 1961.

37. Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 (the Act, 2013) with respect to Directors Responsibility Statement, it is hereby stated:

a. that in the preparation of annual accounts for the financial year ended 31 ^st March 2026, the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any;

b. that the Directors had selected such accounting policies and applied them consistently and made judgements and estimates that were reasonable and prudent to give a true and fair view of the situation of the Company at the end of the financial year and of the profit of the Company for the year under review;

c. that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the Directors had prepared the annual accounts for the financial year ended 31st

March 2026 on a "going concern basis";

e. that the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

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

38. Acknowledgement

The Directors thank all the customers, vendors, bankers, Central and State Governments and investing institutions, for their valuable support.

The Directors wish to place on record their appreciation of the very good work done by all the employees of the Company during the year under review.

The Board welcomes its new members who have come on board pursuant to the initial public issue of the Company. The Directors also thank the investors for their continued faith in the Company.

For and on behalf of the Board of Directors
For SEDEMAC Mechatronics Limited
(Formerly known as SEDEMAC Mechatronics Private Limited)
Shashikanth Suryanarayanan	Amit Arun Dixit
Managing Director	Joint Managing Director
DIN: 01269904	DIN: 01288169
Date: 12th August, 2026	Date:12th August, 2026
Place: Tiruvannamalai	Place: Pune