Shellz India Ltd Directors Report

Dear Members,

The Directors of your Company have pleasure in presenting their fourteenth Report for the year ended 31 March 2026, pursuant to Section 134(3) of the Companies Act, 2013.

1 Financial summary

STANDALONE, ? LAKH	2025-26	2024-25
Revenue from operations	19,269.52	18,697.32
Profit before depreciation, exceptional items and tax	2,288.85	1,632.57
Less: depreciation, amortisation, impairment and obsolescence	359.85	383.78
Profit before tax	1,929.00	1,248.79
Less: provision for tax	618.08	361.08
Profit for the year carried to the balance sheet	1,310.92	887.71

2 State of the Companys affairs

For operational convenience, the Company, with effect from 08.10.2025, has shifted its registered office from 99, Main Chowk, Samaypur, Delhi to its corporate office at 39/35, 2nd Floor, Main Rohtak Road, Near Shivaji Park Metro Station, West Punjabi Bagh, Delhi 110026.

3 Capital and finance

During the year under review, the Company issued and allotted:

(i) 33,557 fully paid-up equity shares of face value ?10 each on a preferential basis on 29.09.2025, for an aggregate consideration of ?4,99,99,930 at an issue price of ?1,490; and

(ii) 79,90,312 fully paid-up equity shares of face value ?10 each as bonus shares to the existing equity shareholders, in the proportion of 11 new fully paid-up equity shares for every 1 existing fully paid-up equity share held as on 10 November 2025.

4 Capital expenditure

During the year under review, the Company continued to utilise the industrial property bearing Plot No. 427 F, Phase I, HSIIDC Industrial Estate, Barhi, Sonipat, Haryana 131101, taken on lease from Pluchi Texnit Private Limited, for its manufacturing operations. The Company has installed machinery at the facility and commenced its utilisation for operational requirements. The Company is also in the process of installing additional machinery and equipment to augment manufacturing capacity, improve operational efficiency and support its future expansion plans.

5 Amount carried to general reserve

The Company has not transferred any amount from profit and loss to general reserve during the financial year.

6 Dividend

Your Directors do not recommend any dividend for the year ended 31 March 2026.

7 Material changes and commitments

There are no material changes affecting the financial position of the Company between the end of the financial year and the date of the report.

8 Conservation of energy, technology absorption, foreign exchange

Conservation of energy: the Company has taken necessary steps relating to conservation of energy to the extent applicable. Regular and periodic maintenance keeps all machines and equipment in working condition, to enhance their efficiency and reduce power consumption. At the new manufacturing facility at Barhi, Sonipat, the Company shall continue utilising alternate sources of energy by using solar panels to reduce traditional power consumption.

Technology absorption: multiple technology advancement efforts are being made in the design of the Companys existing and proposed projects.

Foreign exchange: during the year, the Company earned foreign exchange equivalent to ?103.06 lakh and incurred expenditure equivalent to ?51.85 lakh.

9 Directors and Key Managerial Personnel

None of the Directors and KMPs were appointed or resigned during the financial year. Mr. Kapil Garg, Managing Director, retires by rotation at the 14th Annual General Meeting and offers himself for re-appointment. The Notice convening the AGM includes the proposal for his re-appointment.

10 Declaration by Independent Directors

Declarations under Section 149(6) of the Act have been received from the Independent Directors, and the Board is satisfied as to their integrity, expertise, experience and proficiency. The Independent Directors met once, in compliance with Clause VII of Schedule IV of the Act.

11 Subsidiaries, joint ventures and associates

During the year, in March 2026, the Company acquired 18,57,675 equity shares, constituting almost 100% of the paid- up share capital of Shellz Overseas Private Limited (CIN U65923DL1996PTC078653), making it a wholly owned subsidiary of the Company.

12 Deposits

The Company has not accepted deposits from the public falling within the ambit of Section 73 of the Act and the rules framed thereunder.

13 Cost records

Maintenance of cost records under Section 148(1) of the Act is not applicable to the Company.

14 Protection of women at the workplace

The Company is committed to a safe and inclusive workplace free from sexual harassment, and has a policy on protection of womens rights at the workplace, which has been widely disseminated. No cases of sexual harassment were received during the year ended 31 March 2026.

15 Insolvency and Bankruptcy Code, 2016

During the year, Baba Industries, a packaging material supplier, filed an insolvency petition (IB-256/ND/2025) on 07.04.2025 against the Company, which was dismissed as withdrawn by order of the Honble NCLT, Delhi dated 2702.2026. After the close of the year, in May 2026, Rotopack Inc., a packaging material supplier, filed a petition (IB/261/ND/2026) on 20.05.2026 before the Honble NCLT, Delhi; the Company has amicably settled the matter by a settlement agreement dated 18.08.2026. Accordingly, as on the date of this Report, no proceedings under the Code are pending against the Company, save the Rotopack petition, which has been settled and shall be withdrawn.

16 One-time settlement

The Company has not made any one-time settlement with banks or financial institutions, and this clause is therefore not applicable.

17 Maternity Benefit Act, 1961

The Company has complied with the applicable provisions of the Maternity Benefit Act, 1961.

18 Risk management framework

The Company has a mechanism to inform the Board about risk assessment and minimisation initiatives, and periodically reviews risk to ensure that executive management controls it through a properly designed framework.

19 Corporate social responsibility

On the recommendation of the CSR Committee and in accordance with the CSR Policy, the Board approved a contribution of ?17,00,000 to Global Social Welfare Organisation, an organisation engaged in education and related activities, towards the Companys CSR obligation.

20 Depository system

As on 31 March 2026, 100% of the Companys paid-up share capital, representing 87,16,704 equity shares, is held in dematerialised form.

21 Meetings of the Board

During the year, eleven meetings of the Board were held, on 09.05.2025, 01.08.2025, 0709.2025, 16.09.2025, 29.09.2025, 08.10.2025, 10.11.2025, 24.02.2026, 11.03.2026, 25.03.2026 and 30.03.2026. The gap between two consecutive meetings did not exceed 120 days.

22 Directors responsibility statement

As required under Section 134(3)(c) of the Act, the Directors, to the best of their knowledge and belief, state that:

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

(ii) they have selected accounting policies, applied them consistently and made reasonable and prudent judgements and estimates so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of its profit for the year;

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) they have prepared the annual accounts on a going concern basis; and

(v) they have devised proper systems to ensure compliance with all applicable laws, and such systems were adequate and operating effectively.

23 Frauds reported by auditors

There were no frauds committed against the Company during FY 2025-26 by its officers or employees which are required to be disclosed under Section 143(12) of the Act.

24 Committees of the Board

The Board has constituted the following Committees: Audit Committee (Mrs. Sapna Tomar, Chairperson; Mr. Narinder Sethi; Mr. Kapil Garg); Nomination and Remuneration Committee (Mr. Narinder Sethi, Chairperson; Mrs. Sapna Tomar; Mrs. Shalini Garg); Stakeholders Relationship Committee (Mrs. Sapna Tomar, Chairperson; Mr. Narinder Sethi; Mrs. Shalini Garg); and Corporate Social Responsibility Committee (Mr. Kapil Garg, Chairperson; Mrs. Shalini Garg; Mrs. Sapna Tomar).

25 Auditors report and secretarial audit

The Statutory Auditors report does not contain any qualification, observation, comment or adverse remark. Secretarial audit under Section 204 of the Act is not applicable to the Company for the year under review.

26 Loans, investments, guarantees and security

Except for acquiring almost 100% of the paid-up share capital of Shellz Overseas Private Limited, the Company has not made any investment, given guarantees or provided security.

27 Contracts with related parties

The Board approved the related party transactions for 202526. All were in the ordinary course of business and at arms length; details are given in Annexure A. There are no materially significant related party transactions that may conflict with the interest of the Company.

28 Vigil mechanism

The Whistle Blower Policy meets the requirements of the vigil mechanism under the Act, provides adequate safeguards against victimisation and direct access to the Chairperson of the Board.

29 Internal financial controls

The Company has a process-driven framework for internal financial controls within the meaning of Section 134(5)(e). For the year ended 31 March 2026, the Board is of the opinion that these controls are sound, commensurate with the nature and size of the business, operating effectively, and that no material weaknesses exist.

30 Secretarial standards

The Company has complied with the Secretarial Standards on Board Meetings and General Meetings issued by the Institute of Company Secretaries of India.

31 Auditors

M/s R S A V and Company, Chartered Accountants (FRN 022058N), were appointed Statutory Auditors from the conclusion of the 12th AGM until the conclusion of the 17th AGM.

32 Significant and material orders

No significant and material orders were passed by regulators, courts or tribunals impacting the going concern status and the Companys operations in future.

33 Annual return

The Company has initiated modifications to its website to upload the Annual Return as on 31.03.2026 in Form MGT-7, in accordance with Section 92(3) of the Act.

34 Designated person for beneficial interest

Mr. Kapil Garg, Managing Director, is the designated person for furnishing information and extending co-operation to the ROC in respect of beneficial interest in shares of the Company.

35 Other disclosures

No disclosure is required under Section 67(3)(c) of the Act in respect of voting rights not exercised directly by employees.

36 Acknowledgement

Your Directors thank the customers, supply chain partners, financial institutions, banks, Central and State Government authorities, regulatory authorities and all other stakeholders for their continued co-operation and support.