Sterling Tools Ltd Directors Report

Dear Members,

Your directors are pleased to present the 46th Annual Report on the business and operations of Sterling Tools Limited (‘the Company) and Audited Financial Statements (Standalone and Consolidated) for the financial year ended 31^st March 2025.

Financial Summary & Highlights

The Companys financial performance for the year under review along with the previous years figures are given hereunder:

(Amount in Lacs)

	Standalone		Consolidated
Particulars
	2024-25	2023-24	2024-25	2023-24
Revenue from Operations	64,478.34	60,813.75	1,02,629.95	93197.17
Other Income	683.14	556.06	1,165.40	653.94
Total Revenue	65,161.48	61,369.81	1,03,795.35	93851.11
Total Expenditure	55,683.13	52,324.52	91,673.05	82,419.76
(excluding Depreciation and Finance Cost)
Profit before interest, depreciation, taxes and	9,478.35	9,045.29	12,122.30	11,431.35
exceptional Items
Less: Interest	585.19	748.38	976.99	946.23
Depreciation	3,090.21	3,123.97	3,481.79	3,305.10
Add/(Less): Exceptional items	-	39.71	-	39.71
Profit Before Tax	5,802.95	5,212.65	7,663.52	7,219.73
Less: Current Tax	1,489.07	1,471.26	1,956.29	1,958.85
Deferred Tax	26.91	(139.22)	(122.08)	(275.62)
Profit for the Year	4,286.97	3,880.61	5,829.31	5,536.50
Add/(Less): Other Comprehensive Income	(951.75)	(346.22)	(952.73)	(347.62)
Total Comprehensive Income for the Year	3,335.22	3,534.39	4,876.58	5,188.88

Companys performance and outlook

STANDALONE

The standalone performance for FY 2024 25 reflected a modest improvement. Revenue from operations increased to 644.78 crore and the company delivered an impressive profit after tax of 42.87 crore. The overall financial position remains stable, underscoring resilience and consistent operational performance.

CONSOLIDATED

The consolidated results for FY 2024 25 reflect a strong performance. Revenue from operations rose significantly by 10% to 1,026 crore, with contribution from EV Business. Profit before tax increased by 6.15% to 76.63 crore, while profit after tax grew by 5.29% to 58.29 crore, highlighting the Companys solid financial health and the success of its strategic initiatives

On a consolidated basis, the Company delivered a strong performance in FY 2024 25 and is well-positioned for future growth. SGEM achieved impressive financial and operational results, driven by its focus on innovation and sustainability. With a good market presence and forward-looking strategies, SGEM plans to expand its product range to stay competitive in the fast-growing electric vehicle industry.

The Company is focused on growing its market share by expanding its product range and securing new business in both ICE and EV segments. With over 46 years of experience and strong financial stability, it is well-positioned to explore new opportunities and introduce innovative products through new ventures. The goal is to consistently deliver high-quality products to both existing and new customers, ensuring long-term growth and performance.

Management views the future with confidence and anticipates continued improvement in the coming years. The Companys outlook, along with that of the Automobile Industry, is detailed in the Management Discussion and Analysis Report, which forms part of this Report.

Consolidated Financial Statements

The audited Consolidated Financial Statements in addition to the audited Standalone Financial Statements pursuant to Section 129(3) of the Companies Act, 2013 (Act) read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations) and prepared in accordance with the Indian Accounting Standards prescribed by the Institute of Chartered Accountants of India is enclosed and forms part of this report.

The Consolidated Profit and Loss Account for the period ended 31^st March 2025, includes the Profit and Loss Account for the subsidiaries i.e. Sterling Gtake E-Mobility Limited, Sterling Tech-Mobility Limited, Sterling E-Mobility Private Limited, Sterling Advanced Electric Machines Private Limited and Sterling Overseas Pte. Ltd. for the complete Financial Year ended 31^st March 2025.

Further, the Honble National Company Law Tribunal, New Delhi Bench, vide order dated 27th March 2025 ("Order"), has approved the Scheme of Amalgamation of Haryana Ispat Private Limited (‘Wholly Owned Subsidiary") with the Company with effect from 1^st April 2024 ("Appointed Date") and the Order was filed by the Company with the Registrar of Companies, NCT of Delhi and Haryana on 23^rd April 2025.

In accordance with the third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements have been placed on the website of the Company in the Shareholders Meetings section at https://stlfasteners.com/ investors/shareholders-meetings.

Transfer to General Reserve

During the year under review, the Company has not transferred any funds to General Reserves out of the amount available for appropriation.

Dividend

The Company has a strong track record of rewarding its shareholders with substantial dividend payouts. Given the robust operational and financial performance of the Company during the year under review, the Board of Directors are pleased to recommend a final dividend of 125% i.e. 2.50/- (Rupees Two and Paise Fifty only) per equity share for the FY 2024-25, subject to approval of shareholders in the ensuing Annual General Meeting. This dividend payout will be in accordance with the Companys Dividend Distribution Policy, which is available on the Companys website: https://stlfasteners.com/public/f/pdfs/ Dividend-Distribution-Policy.pdf

In accordance with the prevailing provisions of the Income Tax Act, 1961, the dividend, if declared, will be taxable in the hands of the shareholders at the applicable rates. Consequently, the Company will make the final dividend payment after deducting the tax at source. For detailed information on the procedure for the declaration and payment of the dividend, shareholders are requested to refer to the Notice of the 46th Annual General Meeting.

Deposits

During the year under review, the Company has not accepted any deposits which fall under the purview of Section 73 of the

Companies Act, 2013, and as such, no amount of principal or interest was outstanding as of the Balance Sheet date.

i. Number of cases of default in repayment of deposits or payment of interest thereon beginning of year- 0

ii. Maximum number of cases of default in repayment of deposits or payment of interest thereon during year- 0

iii. Number of cases of default in repayment of deposits or payment of interest thereon end of year- 0

Depository System

As the members are aware, the Company shares are compulsorily tradable in electronic form. As on 31^st March 2025, 99.81 % of the Companys total paid-up Capital representing 3,61,15,287 equity shares are in dematerialized form. In view of numerous advantages offered by the Depository System, members holding shares in physical mode are advised to avail of the facility of dematerialization from either of the Depositories.

Capital Structure and Listing

As of 31^st March 2025, the Company has an Authorized Share Capital of 10,00,00,000 and a Paid-Up Share Capital of 7,23,68,636, with the Promoters and Promoter Group holding 65.02% of the Companys share capital. The Companys equity shares are listed on the National Stock Exchange of India Limited and BSE Limited, with listing fees paid to both exchanges for FY 2025-26.

During the year under review, the Company has allotted 1,60,107 equity shares to Mr. Jaideep Wadhwa, Non-Executive Non-Independent Director of the Company, pursuant to the exercise of first tranche of ESOPs granted to him in the capacity of Managing Director of Sterling Gtake E-Mobility Limited, Wholly owned Subsidiary, in terms of the STL Employee Stock Option Plan, 2023 and vesting schedule thereof. Further, pursuant to the listing application by the Company in respect of the shares allotted to Mr. Jaideep Wadhwa, the said equity shares were listed and admitted to dealings on the National Stock Exchange of India Limited and BSE Limited effective from 17th March 2025. Furthermore, subsequent to the closure of the financial year, the Authorised Share Capital of the Company increased by 1,00,00,000 pursuant to the addition of the Authorised Share Capital of Haryana Ispat Private Limited following its amalgamation with and into the Company.

Subsidiaries, Joint Ventures, and Associate Companies: Changes During the Year

As on 31^st March 2025, the Company has five wholly owned subsidiaries. During the year, the Company had the following subsidiary Companies, the status of which is mentioned thereto:

S. No	Name of the Entity	Nature of Relationship	Remarks
1	Sterling Gtake E-Mobility Ltd.	Wholly owned Subsidiary	Existing Subsidiary
2	Sterling Tech-Mobility Ltd.	Wholly owned Subsidiary	New Subsidiary
3	Sterling E-Mobility Private Ltd.	Wholly owned Subsidiary	New Subsidiary
4	Sterling Advanced Electric Machines Pvt. Ltd.	Wholly owned Subsidiary	Existing Subsidiary
5	Sterling Overseas Pte Ltd.	Wholly owned Subsidiary	New Subsidiary
6	Haryana Ispat Pvt. Ltd.	Wholly owned Subsidiary	Amalgamated w.e.f. the appointed date i.e.
			1st April 2024

In accordance with Section 129(3) of the Companies Act, 2013, a statement containing the salient features of financial statements as on 31^st March, 2025 is presented by way of Form AOC 1 as an Annexure -I. Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of subsidiaries, are available on the website of the Company at https://stlfasteners.com/investors.

Key business developments during the year under review

1. Update on the Scheme of amalgamation of Haryana Ispat Private Limited with and into Sterling Tools Limited.

The Board of Directors of the Company at its Meeting held on 1^st February 2024, accorded its consent for the Scheme of Amalgamation of Haryana Ispat Private Limited ("Transferor Company"), Wholly Owned Subsidiary, with and into Sterling Tools Limited ("Transferee Company") and their respective shareholders and creditors, subject to necessary approvals of authorities and the Honble National Company Law Tribunal, New Delhi (Honble NCLT).

The Companies filed a joint first motion application with Honble NCLT on 29th February 2024. The Honble NCLT vide its Order pronounced on 18th April 2024 has allowed the dispensation of the meetings of the shareholders and creditors of the Companies. The Companies had filed a second motion application with Honble NCLT on 29^th April 2024.

On 27^th March 2025, the Honble NCLT, New Delhi, approved the said Scheme of Amalgamation pursuant to the provisions of Sections 230 to 232 of the Companies Act, 2013. On April 2, 2025, the certified copies of the order approving the Scheme was received from the Honble NCLT and the said Scheme became effective from 1^st April 2024 i.e. the Appointed Date upon filing e-Form INC- 28 (Notice of Order of the Court) with the Registrar of Companies, National Capital Territory of Delhi and Haryana.

The aforesaid Scheme of Arrangement is available on the website of the Company at https://stlfasteners.com/ investors/corporate-governance.

2. Update on new wholly owned subsidiaries of the Company

Pursuant to the approval of the Board of Directors at its meeting held on 10th May 2024, the Company acquired 100% equity shares of Sterling E-Mobility Private Limited and Sterling Tech-Mobility Limited from their respective promoters, thereby making both entities wholly owned subsidiaries of the Company with effect from 28th June 2024. Furthermore, as part of its overseas expansion into Singapore, the Company has incorporated a new wholly owned subsidiary in Singapore with name Sterling Overseas Pte Ltd., with effect from 23^rd September 2024.

Employee stock option Plan

STL-Employee Stock Option Plan-2023 was introduced to offer employees of the Company and its subsidiary companies; an additional incentive tied to productivity and performance. This initiative aims to motivate employees and contribute to the overall corporate growth and profitability of the Company. In accordance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, a total of 900,605 (Nine Lakh Six Hundred and Five) ESOP options were approved under the ESOP Plan.

A certificate from M/s. Dhananjay Shukla & Associates, Secretarial Auditors, regarding this plan and the resolution passed by members will be available for inspection on the Companys website under the "Investors" section on the date of the Annual General Meeting. There is no change in the Plan, the same follows the applicable regulations. A statement providing complete details as of 31^st March 2025, pursuant to Regulation 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, is also available on the Companys website. The web link for this information is https://stlfasteners. com/investors/shareholders-meetings.

Material changes and commitments

No material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and date of this report.

Change in the nature of business, if any.

There was no change in the nature of business of the Company during the FY 2024-25.

Directors and Key Managerial Personnel

As on 31^st March 2025, there were ten (10) Directors on the Board of the Company, consisting of five (5) Independent Directors, two (2) Non-Executive Directors, one (1) Managing Director, and two (2) Whole-Time Directors. Changes in the Board of Directors and KMP during the year under review are as follows:

Mr. Sanjiv Garg (DIN: 00428757) appointed as a Non-Executive & Non-Independent Director w.e.f. 10^th May 2024.

Change in Designation of Mr. Anil Aggarwal from Chairman & Managing Director to Chairman & Whole Time Director of the Company effective from 11^th May 2024

Change in Designation of Mr. Atul Aggarwal from Whole Time Director to Managing Director and KMP of the Company effective from 11^th May 2024.

Appointment of Mr. Akhill Aggarwal as Whole-Time Director effective from 10^th May 2024.

Resignation of Mr. Abhishek Chawla as Company Secretary (KMP) and Compliance Officer of the Company effective from closure of business hours of 13th March 2025.

Key Managerial Personnel (KMP) other than directors as mentioned above as of 31^st March 2025 were:

Mr. Pankaj Gupta, Chief Financial Officer

Post closure of FY 2024-25, the Board of Directors of the Company in its meeting held on 7th August 2025 appointed Ms. Komal Malik as the Company Secretary and Compliance Officer, designated as KMP of the Company w.e.f. the said date.

In accordance with the provisions of the Companies Act, 2013, and in terms of Articles of Association of the Company, Mr. Jaideep Wadhwa, Non-Executive and Non-Independent Director is liable to retire by rotation and being eligible, has offered himself for re-appointment. The details pertaining to Mr. Jaideep Wadhwa being recommended for re-appointment are included in the notice of the ensuing Annual General Meeting of the Company. Furthermore, the first term of Mr. Rakesh Batra as an Independent Director is set to expire on 9th November 2025. Accordingly, the Board of Directors based on the performance evaluation and as recommended by the Nomination and Remuneration Committee, recommends his re-appointment for a second term of five consecutive years, commencing from 10th November 2025, for approval by the shareholders at the ensuing Annual General Meeting.

Declaration of Independence by Independent Directors.

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and have complied with the Code of Conduct for Independent Directors prescribed in Schedule IV of the Act and there has been no change in the circumstances which may affect their status as independent director during the year.

In the opinion of the Board of Directors, all the Independent Directors, including those appointed/re-appointed during the year, are persons of high repute, integrity and possess the relevant proficiency, expertise and experience in their respective fields.

Number of meetings of the Board and attendance of the Directors

The Board met five (5) times during the FY 2024-25, in respect of which notices were given and the proceedings were properly recorded. The intervening gap between two consecutive meetings was not exceeding the period prescribed under the Companies Act, 2013. For details of the meetings of the Board and attendance of the Directors, please refer Clause 2 of Corporate Governance Report attached to this Annual Report.

Disclosure under Secretarial Standards (SS-1 & SS-2):

The Company has complied with the applicable provisions of Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and approved by the Central Government under Section 118 (10) of Companies Act, 2013.

Policy on Directors appointment and remuneration and other details

The Companys policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided in Section 178(3) and Section 134(3) (e) of the Companies Act, 2013 is uploaded on the Website of the Company at https:// stlfasteners. com/assets/upload/investors/20240111111425-nomination-and-remuneration-policy-board-795595043113.pdf

Policy on Board Diversity

The Company recognizes and embraces the importance of a diverse Board in its success. The Company believes that a truly diverse Board will leverage differences in thought, perspective, regional and industry experience, cultural and geographical background, age, ethnicity, race, gender, knowledge and skills including expertise in financial, global business, leadership, technology, mergers & acquisitions, Board service, strategy, sales and marketing, Environment, Social and Governance (ESG), risk and cybersecurity and other domains, which will ensure that the Company retains its competitive advantage. The Nomination & Remuneration Policy explains Board Diversity adopted by the Board sets out its approach to diversity.

The Nomination and Remuneration Committee reviews and assesses board composition on behalf of the board and recommends the appointment of new Directors and Senior Management Personnel. The committee also oversees the conduct of the annual review of board effectiveness.

Board Evaluation

The annual performance evaluation of the Board, including assessments of board committees and individual directors, is carried out in accordance with the Companies Act, 2013, and SEBI Listing Regulations. Following the SEBI guidance note on Board Evaluation from 5th January 2017, a structured questionnaire is developed, focusing on various aspects such as board functioning, composition, culture, execution of duties, and governance.

In a separate meeting of independent directors held on 30^th January, 2025, the independent directors evaluated the performance of non-independent directors, the board as a whole; and the Chairman of the Company, taking into account the views of executive Directors and non-executive Directors. Additionally, the information flow between Management and the Board was assessed for quality, quantity, and timeliness.

Thereafter, the Nomination and Remuneration Committee evaluated the performance of the Board, Independent Directors, Key Managerial Personnel, and Senior Management, considering criteria such as preparedness, meaningful contributions, and key result areas and the Board of Directors of the Company reviewed the performance as evaluated by the Nomination and Remuneration Committee and the Independent Directors. Further the Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

Based on the evaluation, the performance of the Board, Individual Directors, KMP, and SMP was considered to be highly satisfactory.

Particulars of contracts or arrangements with Related Parties

All Related Party Transactions that were entered into during the financial year ended on March 31, 2025 were on an arms length basis and in the ordinary course of business and not material in nature under Section 188(1) of the Act and the Listing Regulations and hence a disclosure in Form AOC-2 in terms of clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 is not required. Details of the transactions with Related Parties are provided in note no. 43 of the accompanying Standalone and Consolidated Financial Statements of the Company in compliance with the provision of Section 134(3)(h) of the Act.

The Company has also adopted the Policy on Related Party Transactions and the same is available on the website of the Company at https://stlfasteners.com/investors/corporate-policies.

Committees of the Board

The Company has the following Board committees, which have been established as a part of the corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

Audit Committee

Nomination and Remuneration Committee

Stakeholders Relationship Committee

Corporate Social Responsibility Committee

Risk Management Committee

Share Transfer Committee

Management Committee

Investment Committee

The details with respect to the compositions, powers, roles, terms of reference and number of meetings held during the year of relevant committees are given in detail in the Corporate Governance Report of the Company, which forms part of this Boards Report.

Auditors

I) Statutory Auditors

As per provisions of Section 139(1) of the Companies Act, 2013, the Company has appointed M/s Walker Chandiok & Co., LLP Chartered Accountants as Statutory Auditors for a period of 5 (Five) years in the AGM of the Company held on 22^ndSeptember 2022.

Statutory Auditors Report

There has been no qualification, reservation or adverse remark reported by the Statutory Auditors in its reports on standalone and consolidated financial statements of the Company for the year ended 31^st March, 2025 forming part of this report.

II) Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed thereunder, M/s Dhananjay Shukla & Associates, Company Secretaries, were appointed as the Secretarial Auditors of the Company to carry out the secretarial audit for the year ended 31^st March, 2025.

The Securities and Exchange Board of India (SEBI) has amended Regulation 24A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 whereby Shareholders, on the recommendation of Board of Directors, may appoint or re-appoint a Secretarial Audit firm as Secretarial Auditors for not more than two terms of five consecutive years, in the Annual General Meeting. Accordingly, the Board of Directors recommends to the Shareholders, the appointment of M/s Dhananjay Shukla & Associates, Company Secretaries, as Secretarial Auditors, for a term of five consecutive years, from the financial year 2025-26 till the financial year 2029-30. The Company has received consent and eligibility certificates from M/s Dhananjay Shukla & Associates, Company Secretaries, to serve as Secretarial Auditors of the Company. M/s Dhananjay Shukla & Associates, Company Secretaries, holds a valid Peer Review Certificate, issued by the Institute of Company Secretaries of India.

Secretarial Audit Report

In terms of Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI Listing Regulations, a Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as Annexure-II.

The observation made by the Secretarial Auditor for the Committee and Board and composition were duly complied by appointment of Mr. Sanjiv Garg and reconstitution of Committee w.e.f May 8, 2025 and May 10, 2025 respectively. Further post resignation of Mr. Abhishek Chawla as Company Secretary & Compliance Officer on 13^th March 2025, the search for a suitable successor took slightly longer than prescribed. The Board appointed Ms. Komal Malik as Company Secretary & Compliance Officer on 7^th August 2025, restoring compliance.

Further as per the requirement of Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Secretarial Audit report of the material subsidiary namely, Sterling Gtake E-Mobility Limited is also attached as Annexure III.

Annual Secretarial Compliance Report

Annual Secretarial Compliance Report for the financial year ended 31^st March, 2025 on compliance of all applicable SEBI

Regulations and circulars/ guidelines issued thereunder, was obtained from Mr. Santosh Kumar Pradhan, Practicing Company Secretaries and the same was filed with Stock Exchange(s) within the prescribed timeline. The Annual Secretarial Compliance Report is available at https:// stlfasteners.com/investors/corporate-governance.

III) Cost Auditors

As per Section 148 of the Companies Act, 2013, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.

Pursuant to the provisions of Section 148 of the Companies Act, 2013 and Rules made thereunder, M/s Jitender Navneet & Co., Cost Accountants were appointed as the Cost Auditor of the Company for the year ended 31^st March 2025.

Disclosure on maintenance of Cost Records

The Company has maintained the cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, as required by the Company and such accounts and records are made and maintained as per rule 8(5) (ix) of the Companies Accounts Rules, 2014.

Details in respect of Fraud, if any, Reported by the Auditors

M/s Walker Chandiok & Co., LLP, Chartered Accountants, the Statutory Auditors of the Company have stated that during the year ended 31 March 2025, a matter was informed by one of the workers to the management relating to an incident of theft of inventory of raw material by certain employees at a plant location. The financial impact of the matter based on the investigation conducted by the management is 35.79 Lakhs, however the Company has written off the aforesaid inventory. Further such employees have been terminated from employment services, and the Company has taken legal action against them.

Furthermore, M/s Dhananjay Shukla & Associates, Company Secretaries, Secretarial Auditors of the Company and M/s Jitender Navneet & Co., Cost Accountants, Cost Auditors of the Company, have not reported any incidence of fraud in the reports issued by them.

Internal Financial Control Systems and their adequacy

The Company maintains a robust Management Information System, integral to its control mechanism. Policies and procedures have been adopted to enhance transparency and accountability in the design and implementation of internal controls. As of 31^st March, 2025, management assessed the effectiveness of these controls over financial reporting, as defined in Clause 18(3) of SEBI Listing Regulations, and found no material weaknesses or significant deficiencies. Recognizing the inherent limitations of any internal control framework, the Company conducts regular audits and reviews to continuously improve these systems.

M/s Walker Chandiok & Co., LL.P., the statutory auditors of the Company have audited the financial statements and have issued an attestation report on internal control over financial reporting (as defined in section 143 of Companies Act 2013).

Further, the Company has a well-established Internal Audit function, performing risk-based audits across all business areas. Internal audit during the year was conducted by M/s Profaids Consulting. The Audit Committee approves the Internal Audit Plan and Scope at the beginning of the year and receives quarterly updates. Significant findings and corrective actions are reported to the Audit Committee, ensuring ongoing improvement and compliance.

Based on its evaluation (as defined in section 177 of Companies Act 2013 and Clause 18 of SEBI Regulations 2015), the audit committee of the Company has concluded that, as of 31^st March, 2025, internal financial controls were adequate and operating effectively in the Company. The Board accepted the recommendations of the Audit Committee whenever made by the Committee during the year.

Risk Management System

The Company has constituted a Risk management committee and formulated a Risk Management policy to identify, assess and mitigate various risks to the business, which is covered in detail in the Management Discussion and Analysis Report.

The Risk Management Committee identifies the high and medium risks for the Company, develops and implements the risk mitigation plan, reviews and monitors the risks and corresponding mitigation plans on a regular basis and prioritizes the risks, if required, depending upon the impact on the business/reputation. The Company manages, monitors and reports on the principal risks and uncertainties that can impact on its ability to achieve its strategic objectives. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. Furthermore, in the opinion of the Board, there is no element of risk, which may threaten the existence of the Company.

Vigil Mechanism/Whistle Blower Policy

Pursuant to the provisions of Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Company has adopted a policy on Vigil Mechanism for directors and employees to report their genuine concerns or grievance to the Vigilance Officer. The policy is available on the Company website https://stlfasteners.com/ investors/corporate-policies.

Human Resources Management

The employees are the Companys most important assets. The Company is committed to hiring and retaining the best talent. To achieve this, the Company focuses on promoting a collaborative, transparent, and participative organizational culture, and rewarding merits and sustained high performance. The Companys human resource management culture emphasizes enabling employees to develop their skills, grow in their careers, and navigate their personal development for future leadership responsibility.

The Companys goal has always been to create an open and safe workplace for every employee to feel empowered, irrespective of gender, sexual preferences, and other factors, and contribute to the best of their abilities.

Industrial relations remained cordial throughout the year under review. As of 31^st March 2025, the Company had a total of 626 permanent employees, comprising 616 Males and 10 Females.

Particulars of Employees

The details regarding the ratio of the remuneration of each director to the median employees remuneration and other details except the statement showing the names of the top ten employees in terms of remuneration drawn, as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are provided as Annexure IV.

In terms of proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the statement showing the names of the top ten employees in terms of remuneration drawn is being sent to the members of the Company. The said information is available for inspection on all working days, during business hours, at the Registered Office of the Company. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

Details of CSR policy and initiatives undertaken by the company on CSR activities during the year

The composition of the Corporate Social Responsibility Committee has been disclosed in the Corporate Governance Report, attached to this report. The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure–V of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from time to time. The policy on CSR is available on the website of the Company, https:// stlfasteners.com/investors/corporate-policies. Further the implementation and monitoring of CSR Policy is in compliance with the provisions of the Companies Act, 2013.

Sexual Harassment

The Company has in place an Internal Complaint Committee as required under Section-4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made thereunder. The status of the complaints, during the year under review is as below:

Number of sexual harassment complaints received during the year Nil

Number of complaints disposed of during the year- Nil

Number of cases pending for more than 90 days- Nil

Disclosure under the Maternity Benefit Act, 1961

The Directors hereby confirm that the Company is in full compliance with the provisions of the Maternity Benefit Act, 1961 and affirm that

(a) the Company provides maternity leave in accordance with the requirements of the Act;

(b) all necessary facilities and entitlements mandated by the law are extended to women employees;

(c) no discriminatory practices are adopted against women employees on account of maternity or childbirth.

Particulars of Loans, Guarantees or Investments under section 186

Particulars of loans, guarantees given and investments made during the year, as required under section 186 of the Companies Act, 2013 and schedule V of the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulations, 2015, are provided in the Notes to the financial statements.

Credit Rating

The ICRA Limited ("ICRA"), the credit rating agency has reaffirmed the Long-Term Credit rating AA- Outlook Positive as well as Short Term Credit Rating A1+ of the Company. This rating indicates the strong financial health and credibility of the Company.

Capital Expenditure

As on 31^st March 2025, the Gross Fixed Assets including intangible assets stood at 55,294.20 Lacs and Net Fixed Assets stood at 25,993.30 Lacs. Additions during the year amounted to 3,367.97 Lacs.

Cash Flow Analysis

In compliance with the provisions of Regulation 34 of the Listing Regulations, 2015, the Cash Flow Statement for the year ended 31^st March 2025 is part of this Annual Report.

Transfer of amounts to Investor Education and Protection Fund (IEPF )

Pursuant to the provisions of Section 125 of the Companies Act, 2013, relevant amounts along with the shares, which remained unpaid or unclaimed for a period more than seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

S. No	Particulars	Details
1	Amount of unclaimed/ unpaid dividend	2.95 Lacs
2	Underlying shares transferred to IEPF	9300 Shares

Pursuant to the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer & Refund) Rules, 2016, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company on the Ministry of Corporate Affairs website and the shareholders may refer to the Notice of AGM regarding details of amounts and the corresponding shares proposed to be transferred to IEPF during the coming year.

Name of Nodal Officer: Mr. Pankaj Gupta, Chief Financial Officer. Details of Nodal Officer are mentioned on the website of the Company at https://stlfasteners.com/investors/investor-contact

Directors Responsibility Statement

Pursuant to the requirement under section 134(3) (c) of the Companies Act, 2013 with respect to the Directors Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the financial year ended 31^st March 2025, the applicable accounting standards have been followed and there are no material departures.

(ii) the Directors have selected accounting policies in consultation with Statutory Auditors and applied them consistently and made judgements and estimates that are reasonable and prudent 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 the profit of the Company for the financial year under review.

(iii) the directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013. The directors have confirmed that there are adequate control & systems for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(iv) the Directors have prepared the accounts for the financial year ended 31^st March 2025 on a ‘going concern basis.

(v) the directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively.

(vi) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Corporate Governance and Management Discussion & Analysis Report

The Company is committed to maintain good corporate governance standards by applying the best management practices, compliance with the law in true letter and spirit and adherence to ethical standards for effective management and distribution of wealth and discharge of social responsibility for the sustainable development of all stakeholders.

Parameters of statutory compliances evidencing the standards expected from a listed entity have been duly observed and a Report on Corporate Governance as well as the Certificate from Company Secretary in Practice confirming compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") forms part of the Annual Report.

A separate section on corporate governance practices followed by the Company, together with a certificate from a Practising Company Secretary confirming its compliance, forms a part of this Annual Report, as per SEBI Regulations. Further, as per Regulation 34 read with Schedule V of the Listing Regulations, a Management Discussion and Analysis Report is annexed to this report.

Annual Return

As provided under section 134(3)(a) and Section 92(3) of the Companies Act, 2013, the Annual Return in the prescribed form MGT-7 as on 31^st March, 2025 is available on the Companys website at www.stlfasteners.com/investors/.

Business Responsibility and Sustainability Report (BRSR)

The Company takes pride in presenting its third BRSR for the FY 2024-25. This report adheres to the format outlined in the amendment to Regulation 34(2)(f) of the SEBI Listing Regulations as specified in Gazette Notification No. SEBI/LAD- NRO/GN/2021/22 dated May 05, 2021 and is included within the Annual Report. Aligned with the nine principles of the National Guidelines on Responsible Business Conduct issued by the Ministry of Corporate Affairs, Government of India, the BRSR for the FY 2024-25 has been developed and forms part of this report. The Company has strengthened its existing reporting structure and mechanisms to ensure the accurate and reliable capture of data for BRSR disclosures.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

Information pursuant to the provisions of Section 134(3) (m) of The Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption & foreign exchange earnings and outgo is given by way of Annexure-VIto this Report.

Safety, Health and Environment (SHE) Measures

Protection of the environment is the prime concern of the Company. The Company complies with the relevant laws and regulations as well as taking any additional measures considered necessary to prevent pollution, maximize recycling, reduce waste, discharges and emissions. The Company conserve natural resources by their responsible and efficient use in all its operations and aims to reduce carbon emissions in upcoming years.

Quality Management System

STL has implemented robust Quality, Environment management, Data Security and Health & Safety management system at its manufacturing facilities. The facilities are certified by:

Key certifications
IATF 16949 : 2016	Quality Management System
ISO 45001: 2018	Health & Safety Management System
ISO 14001: 2015	Environment Management System
ISO 9001:2015	Quality Management System
ISO 17025	Chemical Testing, Mechanical Testing and
	Instrument Calibration
ISO 27001:2022	Information Security Management
	Systems (ISMS)

Proceedings pending, if any, under the Insolvency and Bankruptcy code, 2016

The Company has neither filed an application during the year under review nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as on 31^st March, 2025.

Significant and Material Orders passed by the Regulators or Courts

During the year under review, the Company has not received any significant order, demand or notice from any Regulatory Authority, Courts or tribunals impacting the going concern status and operations of the Company in future.

Insurance

The Company has taken appropriate insurance for all assets against foreseeable perils.

Weblink to Important documents/information

The Company has hosted certain policies/documents/ information including inter alia Policy for determining Policy on Related Party Transactions, Familiarisation programmes for Independent Directors etc. as per the requirement of law or otherwise on following the link: https://stlfasteners. com/investors/.

OTHER DISCLOSURES

During the financial year under review:-a. The Company has not issued any equity shares with differential rights as to dividend, voting, or otherwise.

b. Except as disclosed in this report and the financials of the Company, there was no issue of shares (including sweat equity shares) to employees of the Company under any other scheme. The equity shares so issued ranked pari-passu with the existing fully paid-up equity shares in all respects as to dividend, etc.

c. The Company does not have any scheme for provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

d. Neither the Managing Director nor the Wholetime Directors of the Company receive any remuneration or commission from any of its subsidiaries.

e. There was no instance of one-time settlement with any Bank or Financial Institution.

f. The Company does not have any shares in an unclaimed suspense demat account.

Acknowledgements

The Directors express deep gratitude to our customers for their sustained support and feedback, which have helped the company meet evolving needs and diversify its product portfolio for sustainable business growth. We thank our dedicated employees for their commitment to our growth and success. We also appreciate our supply chain partners, whose partnership has been key to our industry leadership.

Our sincere thanks go to the regulatory authorities, bankers, financial institutions, rating agencies, stock exchanges, depositories, auditors, legal advisors, consultants, Technology partners and other stakeholders. Your commitment to good governance, transparency, ethics, and accountability has been crucial to our success.