Stanley Lifestyles Ltd Directors Report

To the Members,

The Board of Directors (the Board) takes pleasure in presenting the 19 th Annual Report of Stanley Lifestyles Limited (the Company) together with the Audited Financial Statements, for the financial year ended March31, 2026. The consolidated performance of the Company and its subsidiaries has been referred to, wherever required.

1. Financial Highlights

The financial statements of the Company for the year ended March31, 2026 have been prepared in accordance with Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 (the Act) read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Schedule III to the Act, as amended from time to time and applicable guidelines issued by SEBI.

Rs. in millions

	Standalone		Consolidated
Particulars	For the year ended March 31, 2026	For the year ended March 31, 2025	For the year ended March 31, 2026	For the year ended March 31, 2025
Revenue from operations	1,986	2,175	4,193	4,262
Other income	243	236	228	172
Total Income	2,229	2,411	4,421	4,434
Expenses
Raw Materials and components consumed	1,146	1,237	1,626	1,536
Purchase of stock-in- trade	-	-	119	280
Changes in inventories of finished goods and work-in-progress & Stock-in-trade	(8)	27	25	47
Employee benefits expenses	270	284	650	625
Finance costs	68	52	256	182
Depreciation and amortization expenses	142	124	517	444
Other expenses	471	432	1,019	956
Total Expenses	2,089	2,156	4,212	4,070
Profit before exceptional item and tax	140	255	209	364
Exceptional item	14	-	33	-
Profit before Tax	126	255	176	364
Tax Expenses:
Current Tax	23	61	52	128
Deferred Tax Charge/(Credit)	5	(4)	(3)	(64)
Current Tax expense of earlier years	(2)	5	(3)	8
Tax Expenses	26	62	46	72
Share of (Loss) from Associate	-	-	-	-
Share of profit/loss attributable to	-	-	-	1
Minority Interest
Profit after Tax	100	193	121	291
Profit for the year	100	193	121	291

2. State of affairs of the Company

During the year under review, your Company continued to be stable at revenue of Rs. 1,986 million as against Rs. 2,175 million in the previous year- a drop of 8.69 %. Profit for the year 2025-2026 was Rs. 100 million as against Rs. 193 million in the previous year- a decline of 48.19%.

As per the consolidated financial statements, the revenue and profit for the year 2025-2026 were Rs, 4,193 million and Rs. 144 million respectively as against H 4,262 million and RS. 292 million in the previous year - decline of 1.62% in revenue and a decline of (50.68)% in profit.

The Companys product line is diverse to meet the needs of its customers. The Companys extensive product line comprises Fixed Furniture, Loose Furniture, Kitchen & Cabinetry Division and other accessories such as shoes, bags, perfumes, etc. The Company has been continuously driving product innovation ensuring a steady supply of safe products to its consumers. The Company has a wide range of product baskets that span across every price point catering to requirements of premium to mass segment consumers. The Company continues to retain and reinforce its market share under organized sector with a pan India distribution network comprising of distributors/dealers and retailers.

3. Share Capital

During the year under review, pursuant to the exercise of stock options granted under the Employee Stock Option Plan (ESOP Plan 2022), and in accordance with the approval granted by the Nomination and Remuneration Committee at its meeting held on July 4, 2025, the Company allotted 18,505 (Eighteen Thousand Five Hundred and Five) equity shares of face value RS. 2 (Rupees Two only) each to the eligible employees.

Consequently, the issued, subscribed, and paid-up share capital of the Company stands increased to 5,71,25,663 (Five crore seventy-one lakh twenty-five thousand six hundred sixty-three.) equity shares of face value RS. 2 (Rupees Two only) each, aggregating to RS11,42,51,326 ( Eleven crore forty-two lakh fifty-one thousand three hundred twenty-six.).

The Authorised Share Capital of the Company is RS15,00,00,000/- (Rupees Fifteen Crores only) divided into 7,50,00,000 (Seven Crores and Fifty Lakhs) equity shares of RS. 2/- (Rupees Two only) each.

The Issued, Subscribed and Paid-up Capital of the Company:

As on March31, 2025, the issued, subscribed, and paid-up share capital of the Company stood at 5,71,07,158 (Five Crore Seventy-One Lakh Seven Thousand One Hundred and Fifty-Eight) equity shares of face value RS. 2 (Rupees wo only) each, aggregating to Rs. 11,42,14,316 (Rupees Eleven Crore Forty-Two Lakh Fourteen Thousand Three Hundred and Sixteen only).

Subsequently, pursuant to the exercise of stock options granted under the Employee Stock Option Plan (ESOP), and in accordance with the approval granted by the Nomination and Remuneration Committee at its meeting held on July 4, 2025, the Company allotted 18,505 (Eighteen Thousand Five Hundred and Five) equity shares of face value RS. 2 (Rupees Two only) each to eligible employees.

Consequently, as on March31, 2026, the issued, subscribed, and paid-up share capital of the Company stands increased to 5,71,25,663 (Five Crore Seventy-One Lakh Twenty-Five Thousand Six Hundred and Sixty-Three) equity shares of face value RS. 2 (Rupees Two only) each, aggregating to RS11,42,51,326 (Rupees Eleven Crore orty-Two Lakh Fifty-One Thousand Three Hundred and Twenty-Six only).

4. Issue of debentures, bonds or any non-convertible securities

The Company has not issued any debentures, bonds or any non-convertible securities during the year under review.

5. Issue of warrants

The Company has not issued any warrants during the year under review.

6. Dividend Distribution Policy

The Dividend Distribution Policy of the Company sets out the parameters and circumstances that the Board considers in determining the distribution of dividend in terms of regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) which can be accessed on the Website of the Company at https://www.stanleylifestyles.com/storage/Investor/ August2024/nKQCX-Dividend%20Distribution.pdf

7. Dividend

The Board has not recommended any dividend for the financial year under review.

8. Transfer of unclaimed/unpaid dividend and the corresponding shares to Investor Education And Protection Fund (IEPF)

The Company has no unclaimed/unpaid dividend during the year under review.

9. Transfer to Reserves

The Board does not propose to transfer any amount to reserves during the year under review.

10. Change in the nature of Business

There has been no change in the nature of business of the Company for the year under review.

11. Initial public offering of equity shares

During the previous year ended 31 st March, 2025, Stanley Lifestyles Limited successfully completed its Initial Public Offering (IPO) aggregating to RS. 5,370.24 million comprising ,45,53,508 equity shares at an offer price of RS. 369 per share (RS. 367 premium and RS. 2 face value), which included a fresh issue of 54,20,054 equity shares aggregating to RS. 2,000.00 million and an Offer for Sale of 91,33,454 equity shares aggregating to RS. 3,370.24 million, with the equity shares listed on NSE and BSE on June 28, 2024; the gross proceeds of RS. 2,000.0 million (excluding OFS) were reduced by issue-related expenses of RS. 189.15 million, resulting in net proceeds of RS. 1,810.85 million, later revised upward to RS. 1,839.37 million due to lower actual expenses, and as confirmed in the Q4 FY26 Pursuant to the IPO, equity shares were listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on 28 th June 2024. Monitoring Agency Report by ICRA, the utilization of proceeds was fully aligned with the stated objects of the issue-investment in subsidiaries for new stores, anchor stores and renovations, capital expenditure for machinery and equipment, and general corporate purposes-with RS. 1,220.08 million utilized by March31, 2026, RS. 779.92 million temporarily parked in fixed deposits earning interest, and no material deviations or adverse events reported.

12. Utilization of IPO proceeds

The Company successfully raised RS. 5,370.24 Million (Rupees Five Thousand Three Hundred and Seventy Million Twenty Four Lakhs Only) through its Initial Public Offering (IPO), comprising a Fresh Issue of RS. 2,000.00 million and an Offer for Sale (OFS) of Rs. 0.24 million. Excluding the OFS portion, the Company received gross proceeds of Rs.00.00 million, out of which RS189.15 million was incurred towards issue-related expenses. Consequently, the net proceeds originally stood at RS1810.85 million, subsequently revised upward to RS1839.37 million due to lower actual expenses (a saving of Rs. 2 million).

The net proceeds have been utilised during the year under review in accordance with the objects of the issue, as detailed below:

S. No Item Head	Sub head	Total Amount proposed to be spent	Total Amount spent	Balance Unutilised
		(RS. Millions)	(RS. Millions)	(RS. Millions)
1 Investment in certain Subsidiaries for:	Opening of New Stores under the formats of Stanley Level	901.27	642.60	258.67
	Next, Stanley Boutique and Sofas & More by Stanley
	Opening Anchor Stores	399.90	-	399.90
	Renovation of Existing Stores under the formats of Stanley Level Next, Stanley Boutique and Sofas & More by Stanley	100.40	12.00	88.40
2 Funding capital expenditure requirements for purchase of new machinery and equipment by Company and Stanley OEM Sofas Limited	-	66.59	Fully Utilised
3 General Corporate Purposes	-	342.69 (Revised 371.21)	338.26	32.95
Total		1,810.85	1,059.45	779.92
		(Revised 1,839.37)

There has been no deviation in the utilisation of the IPO proceeds of the Company.

The Monitoring Agency Reports can be accessed on the Website of the Company at https://www.stanleylifestyles. com/investors/investors-information

13. Credit Rating

During the previous year ended 31 st March, 2025, Investment Information and Credit Rating Agency (ICRA), vide its report dated December 30, 2024, assigned the following ratings to the Companys bank facilities: Long-term fund-based facilities - A (Stable); Short-term non-fund-based facilities - A1; and Long-term/Short-term unallocated facilities - A1. Subsequently, ICRA withdrew the ratings on October 10, 2025 at the request of Stanley Lifestyles Limited, following receipt of a no-due certificate (NDC) from its banker, in accordance with ICRAs policy on withdrawal of credit ratings.

14. Consolidated Financial Statements

The audited consolidated financial statements incorporating the duly audited financial statements of the subsidiaries and step-down subsidiaries, as prepared in compliance with the Act Listing Regulations and in accordance with the Indian Accounting Standards specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 along with all relevant documents and the Independent Auditors Report thereon forms part of this Annual Report.

Pursuant to the provisions of Section 129(3) of the Act read with the Companies (Accounts) Rules, 2014, the statement containing salient features of the financial statements of the Companys subsidiaries and step-down subsidiaries for the financial year ended on 31 March2026 in Form AOC-1 forms part of this Annual Report and marked as ANNEXURE I, in this report.

15. Employee Stock Option Plan (ESOP)

Pursuant to Rule 12(9) of Chapter IV of the Companies (Share Capital and Debentures)Rules,2014andRegulation 14 read with Part F of Schedule I of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the disclosures with respect to the employee stock option schemes of the Company are provided in ANNEXURE II forming part of this Boards Report. Share Capital and Debentures

Further, both the National Stock Exchange of India Limited (NSE) and BSE Limited granted in-principle approvals on March Rs. 17, 2026 for issue of up to 18,63,074 equity shares of 2 each to be allotted under the Stanley Lifestyles Limited Employee Stock Option Plan 2022.

Pursuant to the requirements of the SEBI (Share Based Employee Benefit and Sweat Equity) Regulations, 2021, a certificate has been issued by the Secretarial Auditor of the Company confirming that the Stanley Lifestyles Limited Employee Stock Option Plan 2022 has been implemented in accordance with the said Regulations and the resolution passed by the Company in the General Meeting. In compliance with Regulation 14 read with Part F of the SEBI (Share Based Employee Benefit and Sweat Equity) Regulations, 2021, the requisite disclosures as on March31, 2026 are placed on the website of the Company at https://www.stanleylifestyles.com/ storage/Investor/October2025/elARM-Stanley%20 Lifestyles%20Limited%20-%20ESOP%20Plan%20 Latest%20(26.09).pdf.

16. Share Registrar & Transfer Agent

KFin Technologies Limited is the Registrar and Transfer Agent of the Company.

17. Annual Return

Pursuant to Section 134 and Section 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, a copy of the Annual Return is placed on the website of the Company which can be accessed at https://www.stanleylifestyles.com/ investors/corporate-governance

18. Particulars of Loans, Guarantees or Investments

During the year under review, your Company has not given any loan in terms of the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014. The Company has a corporate guarantee of RS. 7 Crore issued to HDFC Bank

Limited on behalf of Stanley OEM Sofas Limited, its Wholly Owned Subsidiary, which was reviewed and successfully renewed by the Board during the year for a further period of one year at an optimized commission rate. Additionally, the Board approved the revocation of a corporate guarantee of RS. 20 Crore given to ICICI Bank Limited on behalf of Stanley Retail Limited, as the underlying credit facilities remained unutilized and were formally closed.

In furtherance to the Objects of the offer as per the prospectus of the Company filed at the time of the IPO of the Company, Your Board of Directors informs you that the Company has made a further investment in Stanley Retail Limited, a wholly owned subsidiary (material subsidiary) of the Company, through a rights issue.

Further, Stanley Retail Limited has made an investment through Rights Issue in Sana Lifestyles Limited and Staras Seating Private Limited, wholly owned subsidiaries of Stanley Retail Limited and step-down subsidiaries of the Company.

Below are the Material Subsidiaries of the Company:

1. Stanley Retail Limited

2. Stanley OEM Sofas Limited

Details of the same are as mentioned in Note No. 6 of the Financial Statements (Standalone).

19. Material changes and commitments, if any, 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.

The Company has initiated a fast-track merger of its wholly-owned subsidiaries under Section 233 of the Companies Act, 2013. The scheme has been approved by the Board and is currently under process of shareholder approval. Appropriate disclosures have been made to the Stock Exchanges in compliance with Regulation 30 of the Listing Regulations.

20. Revision of financial statement or the Report

The Company has not revised its Financial Statement or Boards Report during the financial year or the last three Financial Years.

21. Directors and Key Managerial Personnel

I. Composition of the Board of Directors

As of March 31, 2026, the Board of Directors of your Company consisted of six members, comprising three Executive Directors and three Non-Executive Independent Directors. The composition of the Board is in compliance with the requirements of Regulation 17 of the Listing Regulations and Section 149 of the Act.

The details of the Board members as on the date of the Report are as follows:

Category	Name of Director	Designation
Executive Director(s)	Mr. Sunil Suresh	Executive Chairman
	Mrs. Shubha Sunil	Whole-time Director
	Mr. Venkataramana Seshagirirao Gorti	Managing Director
Non-Executive Independent Director(s)	Mr. Girish Shrikrishna Nadkarni	Independent Director
	Mr. Ramanujam Venkat Raghavan	Independent Director
	Mrs. Anusha Shetty	Independent Director

Change in Composition of the Board of Directors

During the year under review, the composition of the Board of Directors (Board) underwent the following changes:

i. Independent Directors

There were no changes in the composition of the Independent Directors during the year under review.

ii. Other Directors

Resignation of Mrs. Sonakshi Sunil

Mrs. Sonakshi Sunil (DIN: 09387990), Non-Executive Director, resigned from the Board with effect from December 16, 2025.

Appointment and Re-designation of Mr. Venkataramana Seshagirirao Gorti

Mr. Venkataramana Seshagirirao Gorti (DIN: 08526382) was appointed as an Additional Director and Joint Managing Director of the Company with effect from December 16, 2025.

Subsequently, the shareholders approved his appointment as Director and Joint Managing Director by passing a Special Resolution through Postal Ballot on March10, 2026.

Thereafter, based on the recommendation of the Nomination and Remuneration Committee at its meeting held on May 27, 2026, Mr. Gorti was re-designated as the Managing Director of the Company.

Re-designation of Mr. Sunil Suresh

Consequent to the re-designation of Mr. Venkataramana Seshagirirao Gorti as Managing Director, Mr. Sunil Suresh was re-designated from Chairman & Managing Director to Executive Chairman of the Company with effect from May 27, 2026.

iii. Directors retiring by rotation

Mr. Sunil Suresh, Executive Chairman, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment. The Board recommends his reappointment for consideration by the Members of the Company at the ensuing Annual General Meeting.

II. Key Managerial Personnel

The Key Managerial Personnel of the Company in accordance with Regulation 2(1)(bb) of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, Section 2(51) of the Companies Act, 2013 and Senior Management Personnel (SMP) of the Company during the financial year ended 31 March2026:

Name	Designation
Mr. Sunil Suresh	Executive Chairman
Mrs. Shubha Sunil	Whole-Time Director
Mrs. Sonakshi Sunil	Director
Mr. Venkataramana Seshagirirao Gorti	Managing Director
Mr. J K Sharath	Chief Financial Officer
Mr. Rasmi Ranjan Naik	Company Secretary & Compliance Officer
Mr. Mukesh Sharma	Company Secretary & Compliance Officer
Mr. Sharath Shetty	Executive Vice President-
Mr. Sijo Martin	Group Manufacturing Chief Operating Officer - Stanley Retail Limited
Mr. Akash Shetty	Company Secretary & Compliance Officer
Mr. Pradeep Kumar Mishra	Chief Financial Officer

Notes:

1. Mrs. Sonakshi Sunil resigned as Director of the Company with effect from December 16, 2025.

2. Mr. Venkataramana Seshagirirao Gorti was appointed as an Additional Director and Joint Managing Director of the Company with effect from December 16, 2025. The shareholders approved his appointment as Director and Joint Managing Director on March10, 2026, by way of a Special Resolution passed through Postal Ballot. Subsequently, pursuant to the recommendation of the Nomination and Remuneration Committee at its meeting held on May 27, 2026, he was re-designated as the Managing Director of the Company. Consequently, Mr. Sunil Suresh was re-designated from Chairman

& Managing Director to Executive Chairman of the Company.

3. Mr. J. K. Sharath was appointed as the Chief Financial Officer of the Company with effect from August 13, 2025 and resigned from the said position with effect from the close of business hours on March 31, 2026.

4. Mr. Rasmi Ranjan Naik was appointed as the Company Secretary and Compliance Officer of the Company with effect from August 13, 2025, and resigned from the said position with effect from April 8, 2026.

5. Mr. Mukesh Sharma was appointed as the Company Secretary and Compliance Officer of the Company with effect from April 8, 2026.

6. Mr. Akash Shetty, Company Secretary and Compliance Officer, and Mr. Pradeep Kumar Mishra, Chief Financial Officer, formed part of the Key Managerial Personnel of the Company during part of the financial year under review. Mr. Akash Shetty ceased to be a Key Managerial Personnel with effect from the close of business hours on 19 th June 2025, while Mr. Pradeep Kumar Mishra ceased to be a Key Managerial Personnel with effect from the close of business hours on 13 th August 2025.

Further, pursuant to Regulation 16(1)(d) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the following person formed part of the Senior Management Personnel of the Company as on March31, 2026:

Mr. Sharath Shetty - Executive Vice President, Group Manufacturing

Mr. Sijo Martin - Chief Operating Officer, Stanley Retail Limited Resigned with effect from on 25 th March2026.

III. Woman Director

In terms of the provisions of Section 149 of the Act and Regulation 17(1)(a) of the Listing Regulations the Company is required to have at least one-woman director on the Board.

The Company has two Women Directors on the Board, namely, Mrs. Shubha Sunil (DIN: 01363687) as Whole-Time Director and Mrs. Anusha Shetty (DIN: 01666992) as an Independent Director.

IV. Declaration by Independent Directors and statement on compliance with the code of conduct

The Company has received necessary declarations with respect to independence from all the independent directors in compliance of Section 149 (7) of the Act. The declarations are specified in Annexure III to this report

The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Code of Conduct for Directors and senior management personnel formulated by the Company.

V. Nomination & Remuneration Policy

The Nomination and Remuneration Committee has formulated the Nomination and Remuneration Policy which sets out the criteria for determining qualifications, positive attributes and independence of Directors. It also lays down criteria for determining qualifications, positive attributes of KMPs and senior management and other matters provided under Section 178(3) of the Act and the Listing Regulations.

The Nomination and Remuneration Policy of the Company as approved and adopted by the Board is placed on the website of the Company which can be accessed at https://www.stanleylifestyles.com/investors/policies

22. Board Meeting

During the Financial Year 2025-26, our Board has met 6 (Six) times, and the meetings were held on:

Sr. No. Date of Board Meeting	No. of Directors Entitled to Attend	No. of Directors Attended
1 26.05.2025	6	6
2 13.08.2025	6	6
3 28.08.2025	6	5
4 11.11.2025	6	6
5 16.12.2025	6	6
6 12.02.2026	6	6

Requisite quorum was present for all the Meetings. The intervening gap between the Meetings was within the period prescribed under the Act and the Listing Regulations. The Company provides all the Board Members with the facility to participate in the meetings of the Board and its Committees through Video Conferencing or Other Audiovisual Means. The details of the meetings have been enclosed with the Corporate Governance Report, which forms part of this report.

Pursuant to the requirements of Schedule IV to the Act and the Listing Regulations, two separate Meetings of the Independent Directors of the Company were held on November 11, 2025 and March17, 2026 , and the Directors reviewed the matters enumerated under Schedule IV(VII)(3) to the Act and Regulation 25(4) of the Listing Regulations.

23. Committees of Board

The Company has various Committees which have been constituted as part of good corporate governance practices and the same follow the requirements of the relevant provisions of applicable laws and statutes.

The Committees of the Board are the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, Risk Management Committee, Those Charged with Governance Committee and Stakeholders Relationship Committee.

The details with respect to the composition, powers, roles, terms of reference, Meetings held, and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

24. Recommendations of the Audit Committee

During the year under review, there were no instances during the year where the Board rejected any recommendations of the Audit Committee, warranting disclosure under Section 177(8) of the Act.

25. Companys policy on Directors appointment and remuneration

The Policy of the Company on Directors appointment and remuneration, including the criteria for determining qualifications, positive attributes, independence of a director and such other matters, as required under subsection (3) of Section 178 of the Act, is available on the Companys website. The Company affirms that the remuneration paid to the Directors is as per the terms laid out in the Nomination and Remuneration Policy of the Company which is placed on the website of the Company which can be accessed at https://www.stanleylifestyles. com/investors/policies.

26. Annual Evaluation of Board, Committees, and Individual Directors

The Board adopted a formal mechanism for evaluating its performance and as well as that of its committees and individual Directors including the Chairman of the Board. This exercise is being carried out annually through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board and Committees, experience and competencies, performance of specific duties and obligations, contribution at the meetings and otherwise, independent judgment, governance issues etc.

27. Code of Conduct for Board and Senior Management

In compliance with Regulation 26(3) of the Listing Regulations and the Act, the Company has framed and adopted a Code of Conduct for Directors and Senior Management the Code which provides guidance on ethical conduct of business and compliance with laws and Regulations.

All members of the Board and Senior Management personnel have affirmed their compliance with the Code as of March31, 2026. A declaration to this effect, signed by the Managing Director in terms of the Listing Regulations. is given in the Report of Corporate Governance forming part of this Annual Report and is placed on the website of the Company which can be accessed at https://www. stanleylifestyles.com/investors/policies.

28. Code of Practices and procedures for fair disclosure of Unpublished Price Sensitive information

The Board has formulated the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (Fair Disclosure Code), for the fair disclosure of events and occurrences that could impact the price discovery in the market for the Companys securities. The Fair Disclosure Code also provides for maintaining transparency and fairness in dealings with all stakeholders and ensuring adherence to applicable laws and regulations. The same is placed on the website of the Company which can be accessed at https://www. stanleylifestyles.com/investors/policies.

29. Prevention of Insider Trading

The Board of Directors of the Company has formulated and adopted a Code of Conduct to regulate, monitor and report the trading of shares by insiders. This code lays down the guidelines and procedures to be followed and disclosures to be made by the insiders while dealing with shares of the Company and cautioning them of the consequences of non-compliance. The same is placed on the website of the Company which can be accessed at https://www.stanleylifestyles.com/investors/policies.

30. Subsidiary Company, Joint Ventures and Associate Companies

There were no joint ventures and associate companies during the reporting period. The details of Subsidiary Companies/ Step-down Subsidiary Companies of the Company as on March31, 2026, are as follows:

S. No Name of the Company	Relationship	% of shareholding
1 Stanley Retail Limited	Wholly Owned Subsidiary	100.00
2 Stanley OEM Sofas Limited	Wholly Owned Subsidiary	100.00
3 ABS Seating Private Limited	Subsidiary	67.00
4 Sana Lifestyles Limited (Stanley Retail Limited - Holding Company)	Step Down Subsidiary	100.00
5 Shrasta Dcor Private Limited (Stanley Retail Limited - Holding Company)	Step Down Subsidiary	100.00
6 Staras Seating Private Limited (Stanley Retail Limited - Holding Company)	Step Down Subsidiary	100.00
7 Scheek Home interiors Limited (Stanley Retail Limited - Holding Company)	Step Down Subsidiary	100.00

Notes :

Shrasta Décor Private Limited has become a Wholly Owned Subsidiary of Stanley Retail Limited as approved in its Board Meeting held on 13 th August 2025.

Scheek Home Interiors Limited, earlier a step-down subsidiary through Stanley Retail Limited, has since been struck off from the Register of Companies and dissolved pursuant to Section 248(5) of the Companies Act, 2013, vide Notice No. STK-7/001518/2026 dated 20 July 2026 issued by the Registrar of Companies, Centre for Processing Accelerated Corporate Exit (C-PACE).

31. Deposits

During the year under review, your Company has not accepted any deposits from the public within the meaning of provisions of Section 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Therefore, the disclosures required under Rule 8(5) (v) of Companies (Accounts) Rules 2014 and Rule 2(1)(c) of Companies (Acceptance of Deposits) Rules 2014 are not applicable.

32. Remuneration Details of Directors, KMPs and Employees

Information as per Rule 5 of Chapter XIII, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are specified in ANNEXURE IV to this report.

33. Criteria for making payments to Non-Executive Directors

The Non-Executive Directors of the Company are compensated by way of sitting fees for attending meetings of the Board and its Committees, as approved by the Board in accordance with the provisions of the Act and the rules made thereunder. In addition, Non-Executive Directors may be paid commission, subject to approval of the shareholders and within the limits prescribed under the Act.

Independent Directors are not entitled to any stock options.

The remuneration structure is designed to appropriately reflect the time, effort and responsibilities undertaken by the Non-Executive Directors while ensuring compliance with applicable laws and maintaining transparency in governance.

Further, the Company also bears/reimburses expenses incurred by the Directors towards travel, accommodation and other expenses incurred during and for the purpose of attending Board/Committee meetings or in connection with Company-related activities. Apart from the above, no other payment was made by the Company to its Non-Executive Directors during the financial year.

34. Directors Responsibility Statement

In terms of Section 134 (5) of the Act, the Directors would like to state that:

a. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March31, 2026, and of the profit and loss of the Company for that period; c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. The Directors have prepared the annual accounts on a going concern basis; e. The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively and f. The Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and operating effectively.

35. Adequacy of Internal Audit and Financial Controls

The Company has adequate internal controls and processes in place with respect to its operations, which provide reasonable assurance regarding the reliability of the financial statements and financial reporting and also the functioning of other operations. These controls and processes are driven through various policies and procedures. During the year, the review of Internal Financial Controls was done, and the report was placed before the Audit Committee.

As per the report the Controls are effective and there are no major concerns. The internal financial controls are adequate and operating effectively to ensure orderly and efficient conduct of business operations.

36. Statutory Auditors

The Members of the Company at the 17 th Annual General Meeting held on September 30, 2024, re-appointed Messrs. Deloitte Haskins & Sells LLP, Chartered Accountants, (ICAI Firm Registration Number 117366W/ W-100018), as Statutory Auditors of the Company for a second term of 5 years in accordance with the provisions of the Act.

Statutory Auditors of the Company shall hold office from the conclusion of 17 th Annual General Meeting until the conclusion of 22 nd Annual General Meeting to be held 2029-30 for FY 2028-29.

37. Secretarial Auditor

The Members of the Company at the 18 th Annual General Meeting held on September 26, 2025, appointed Mr. Vijayakrishna KT, Practising Company Secretary as the Secretarial Auditor of the Company for a period of five (5) consecutive years, commencing from Financial Year 2025-26 till Financial Year 2029-30.

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Secretarial Audit Report for Financial Year 2025-26 as issued by Mr. Vijayakrishna KT is annexed herewith as ANNEXURE V.

Mr. Vijayakrishna KT was also appointed as the Secretarial Auditor of Stanley Retail Limited and Stanley OEM Sofas Limited, the Material Unlisted Subsidiaries of the Company in accordance with Regulation 24A of the Listing Regulations.

Secretarial Audit Reports for Financial Year 2025-26 as issued by Mr. Vijayakrishna KT for both the Material Subsidiaries are also annexed herewith as ANNEXURE V.

38. Internal Auditor

Messrs Raghavan, Chaudhuri & Narayanan, Chartered Accountants are the Internal Auditors of the Company.

39. Explanation or Comments on Qualifications, Reservations or Adverse Remarks or Disclaimers made by the Statutory Auditor / Secretarial Auditor in their Reports, if any

The Statutory Auditors have given their report with an unmodified opinion, on the standalone and consolidated Financial Statements of the Company for Financial Year 2025-26.

There has been no qualification, reservation, adverse remark or disclaimer made by the Statutory Auditor in their Report for the year under review. The Company is using Accounting Software SAP B1. The Company has updated the Vendor that the audit trail feature is not enabled in Accounting Software. The Vendor is in process to enable the audit trail feature in the software and informing the Company that it may take some time.

Sr. No Qualifications made by the Secretarial Auditor	Managements responses
1) In accordance with Regulation 30 read with Clause 4 (h) of Schedule III of SEBI (LODR) Regulations, 2015, the listed entity shall intimate outcome of meeting of the Board of Directors held to consider financials within 30 minutes or 3 hours, as the case may be, from the time of conclusion of meeting. There was delay in submission of outcome and copy of financial results for the Quarter and year ended 31.03.2025 beyond 3 hours from the time of conclusion of meeting.	The delay was procedural. The delay occurred for few hours beyond the statutory timelines. The Company has taken all efforts to ensure submission at the earliest possibility.
2) In accordance with Regulation 23 (9) of SEBI (LODR) Regulations, 2015, the listed entity shall submit to the Stock Exchanges disclosures of related party transactions in the format as specified by SEBI from time to time. There was a delay of 1 day in submitting the details of related party transactions for the Quarter and year ended 31.03.2025.	The delay was procedural. The delay occurred for few hours beyond the statutory timelines. The Company has taken all efforts to ensure submission at the earliest possibility.
3) In accordance with Regulation 32 of SEBI (LODR) Regulations, 2015, the listed entity shall submit to the Stock Exchanges statement of deviations, if any, or variations and comments/report received from the Monitoring Agency within 45 days from the end of each quarter. Monitoring Agency Report along with the Statement of deviations or variations for the quarter ended 31.03.2025 was submitted on 26.05.2025 beyond the said period of 45 days from the end of quarter.	Meetings of the Audit Committee and Board were held on 26.05.2025 and the said Reports were submitted on the same date accordingly.
4) In accordance with Regulation 23 (9) of SEBI (LODR) Regulations, 2015, the listed entity shall submit to the Stock Exchanges disclosures of related party transactions in the format as specified by SEBI from time to time. There was a delay of 1 day in submission of the details of related party transactions for the Quarter and half year ended 30.09.2025. NSE and BSE respectively levied fine of Rs. 5000. The said fine were duly paid by the Company to both NSE and BSE within the due date.	The delay was procedural. The delay occurred for few hours beyond the statutory timelines. The Company has taken all efforts to ensure submission at the earliest possibility.

Qualifications made by the Secretarial Auditor Managements responses No

5) In accordance with the provisions of Sections 179 and 186 of the The Company clarifies that all investments Companies Act, 2013, there were investments made by the Company made by the Company into subsidiaries in Stanley Retail Limited, Wholly-owned Subsidiary (through rights and step-down subsidiaries were executed issue). The same was duly noted by the Board post investment and within the scope of existing Board-authorized Form MGT 14 in accordance with Section 179 (3) ( e ) was not filed. investment powers and the general authority granted under the Articles of Association. While no specific Board resolutions were passed for these particular rights issue investments by Stanley Retail Limited, the transactions were covered under the broader mandate previously approved by the Board for subscribing to capital in subsidiaries and step-down subsidiaries as part of objects of the IPO, which have been duly approved by the shareholders.

For enhanced transparency, the Company confirms that going forward, any investments in subsidiaries or step-down subsidiaries will be supported by explicit Board resolutions and filed under MGT-14, in line with statutory requirements.

6) Form INC-28 filed for a compounding order received by the Company The said delay was due to administrative on 19.02.2026, issued by the Regional Director, was filed with a reasons. delay, in accordance with the provisions of Section 441 (3) (b) of the Companies Act, 2013.

7) According to the report of the Statutory Auditors for the financial year The Company is using Accounting Software ended 31 March2026, the Company has used accounting software SAP B1. The Company has updated the for maintaining its books of accounts where in the accounting Vendor that the audit trail feature is not software did not have the audit trail feature enabled throughout the enabled in Accounting Software. The Vendor is year. in process to enable the audit trail feature in the software and informing the Company that it may take some time.

40. Compliance with Secretarial Standards

During the Financial year, the Company has complied with the provisions of applicable Secretarial Standards viz. Secretarial Standard on meetings of the Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2).

41. Corporate Social Responsibility

In compliance with Section 135 of the Companies Act 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014, the Company has constituted the Corporate Social Responsibility Committee (CSR Committee) and the composition and function thereof are mentioned in the Corporate Governance Report.

The Board has adopted the CSR Policy formulated, recommended and approved by the CSR Committee, and the same is available on the website of the Company at: https://www.stanleylifestyles.com/storage/Investor/ August2024/M1jiH-Policy_Corporate%20Social%20 Responsibility.pdf

The CSR Committee has been duly constituted by the Company. Constitution of CSR Committee as on 31 March2026 is as follows. The same is available on the website of the Company at: https://www. stanleylifestyles.com/investors/corporate-governance/ committees-of-the-board

Name	Designation	Capacity
Mr. Ramanujam Venkat Raghavan	Chairman	Independent Director
Mrs. Anusha Shetty	Member	Independent Director
Mrs. Shubha Sunil	Member	Executive Director

The Annual Report on CSR Activities of the Company is furnished as ANNEXURE VI

42. Business Responsibility and Sustainability Report

The BRSR follows the National Guidelines on Responsible Business Conduct (NGRBC) principles on the social, environmental and economic responsibilities of business. Our BRSR includes our responses to questions about our practices and performance on key principles defined by Regulation 34(2)(f) of the Listing Regulations as amended from time to time, which cover topics across all ESG dimensions.

The Companys Business Responsibility and Sustainability Report (BRSR) is provided separately as part of the Annual Report.

43. Management Discussion and Analysis Report

Pursuant to Regulation 34(2)(e) of the Listing Regulations, a detailed Management Discussion and Analysis Report for the Financial Year under review is presented in a separate section, forming part of the Annual Report.

The state of the affairs of the business along with the financial and operational developments has been discussed in detail in the Management Discussion and Analysis Report.

44. Corporate Governance

The Company is committed to maintaining the highest standards of Corporate Governance and adhering to the Corporate Governance requirements set out by SEBI.

The Report on Corporate Governance, as required under Regulation 34(3) read with Schedule V of the Listing Regulations, forms part of this Report. Further, as required under Regulation 17(8) of the Listing Regulations, a certificate from the Managing Director is attached to the Report on Corporate Governance.

A certificate from Mrs. Kalaivani S Practicing Company Secretary, confirming the compliance of the Company with the conditions of Corporate Governance, as stipulated under the Listing Regulations, is attached to the Report of Corporate Governance as Annexure VII

45. Related Party Transactions

All contracts/arrangements/transactions entered by the Company during the Financial Year with related parties were in the ordinary course of business and on an arms length basis. During the year under review, our Company has not entered into any contract/arrangement/ transactions with Related Parties which could be considered material in accordance with the Policy on Related Party Transactions. Further there were no materially significant related party transactions entered into by the Company with Promoters, Directors, KMP or other people which may have potential conflicts with the interests of the Company.

The particulars of contracts or arrangements made with related parties pursuant to Section 188 of the Companies Act, 2013 in the prescribed Form AOC-2 is appended as Annexure VIII which forms part of this report. Details of Related Party Transactions as required under Indian Accounting Standard (Ind AS-24) are reported in Note no. 40 forming part of the Financial Statements.

Disclosure on Related Party Transactions, in compliance with the requirements of Listing Regulations and the applicable accounting standards, are made in the financial statements. Also, the Company has adopted the policy on Materiality and Dealing with Related Party Transactions which is available on the website of the Company at: https://www.stanleylifestyles.com/storage/Investor/ August2024/69qIr-Policy%20on%20materiality.pdf.

46. Details of Frauds reported by Auditors

Pursuant to sub-section 12 of Section 143 of the Act, the Statutory Auditors of the Company have not reported any instances of fraud committed in the Company by its officers or employees.

47. Risk Management

The Risk Management Committee was constituted by the Board of Directors on August 31, 2023, in accordance with the Listing Regulations.

The details with respect to the composition, powers, roles, terms of reference, meetings held, and attendance of the members at such meetings of the Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

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

Pursuant to provisions of Section 134(3)(m) & Rule 8(3) (A) of the Companies (Accounts) Rules, 2014 the details of energy conservation, technology absorption and foreign exchange earnings and outgo have been furnished in Annexure IX to this report.

49. Vigil Mechanism

The Company is committed to the highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177 (10) of the Act. All Directors, employees and stakeholders can raise their concerns regarding any discrimination, harassment, victimization, any other unfair practice being adopted against them or any instances of fraud by or against your Company.

As per the Whistle Blower Policy implemented by the Company, the Employees, Directors, customers, dealers, vendors, suppliers, or any stakeholders associated with the Company are free to report illegal or unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or Corporate Governance Policies or any improper activity, to the Chairman of the Audit Committee or to the Company Secretary and Compliance Officer or the Human Resource Department at investors@stanleylifestyles.com.

The policy provides for adequate safeguard against victimization. Any incidents reported are investigated and suitable actions are taken in line with the whistle blower policy. The Whistle Blower Policy is also available on our Companys website at: https://www.stanleylifestyles.com/ storage/Investor/August2024/Kq2nt-Policy_Whistle%20 Blower.pdf

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

There were no material regulatory orders pertaining to the Company for the year under review, except as intimated to the Stock Exchanges from time to time.

The details of the same are available on the Companys website at, https://www.stanleylifestyles.com/investors/ investors-information, websites of the stock exchanges, i.e BSE and NSE, atwww.bseindia.com andwww.nseindia.com.

51. Corporate Insolvency Resolution Process initiated under The Insolvency and Bankruptcy Code, 2016 (IBC)

There were no applications filed for corporate insolvency resolution process, by any financial or operational creditor of the Company or by the company itself, under the IBC before the NCLT.

52. Disclosure as per The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place a Policy for prevention of Sexual Harassment at the Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. The Company has constituted the Prevention of Sexual Harassment Committee to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed of during the period under review:

a. Number of complaints pending at the beginning of the year: NIL b. Number of complaints received during the year: NIL

c. Number of complaints disposed off during the year : NIL

d. Number of cases pending at the end of the year: NIL

53. Compliance with the provisions relating to the

Maternity Benefit Act 1961

The Company affirms its compliance with the applicable provisions of the Maternity Benefit Act, 1961.

54. No. of Employees

The details of employees of the Company as on 31 March2026 are as under: Male: 113 Female: 20 Transgender: 0

55. Maintenance of Cost Records and Cost Audit

The Company confirms that maintenance of cost records and cost audit as specified by the Central Government under Section 148(1) of the Act, is not applicable to the Company and accordingly such accounts and records have been not been made and maintained.

56. 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, if any.

There were no such instances requiring disclosures hereunder.

57. Events subsequent to the date of financial statements, if any.

The Company has undertaken a fast-track merger of its wholly-owned subsidiaries pursuant to Section 233 of the Companies Act, 2013. The Scheme has received approval from the Board and is presently subject to shareholder approval. The requisite disclosures have been made to the Stock Exchanges in accordance with Regulation 30 of the Listing Regulations.

58. Failure to implement any corporate action

There were no such events that took place during the year under consideration.

59. Acknowledgment

The Board takes this opportunity to express its sincere gratitude to the valued customers for their continued patronage and to the investors for reposing confidence in the Company. The Directors also place on record their deep appreciation for the continued support and cooperation extended by the vendors, employees, franchisees, distributors, Government and quasi-government authorities and other stakeholders whose commitment has enabled the Company to achieve sustained growth and progress.

For and on behalf of the Board of Directors

Sunil Suresh
DIN: 01421517
Executive Chairman

Date: 27.05.2026
Place: Bangalore