Vdeal System Ltd Directors Report

<dhhead>BOARD’S REPORT </dhhead>

To, THE MEMBERS, VDEAL SYSTEM LIMITED

The Board of Directors of your Company is pleased to present Seventeenth (17(th)) Annual Report on the business and operations of Vdeal System Limited (referred as "Vdeal" or "Company") together with the Audited Standalone Financial Statements and Auditors’ Report of your Company for the financial year ended March 31, 2026 ("the year under review" or "the year" or "FY 2025-26"). In compliance with the applicable provisions of the Companies Act, 2013, (including any statutory modification(s) or amendment(s) thereof, for the time being in force) ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this report covers the Financial Results and other developments during the financial year ended March 31, 2026, in respect of the Company. The report is in accordance with the applicable provisions of the Companies Act, 2013 ("the Act").

1. Standalone Financial Results:

The summarized financial performance for the financial year 2025-26 under review compared to the previous financial year is given here-in below:

The financial highlights are set out below: (Rs. in lakhs)

Particulars	Financial Year ended
	F.Y. 2025-26	F.Y. 2024-25
Revenue from Operations	4,510.83	3,357.91
Other Income	17.88	2.47
Total Income	4,528.71	3,360.37
Less: Total Expenditure	3,946.43	2,826.93
Profit Before Tax (PBT)	582.25	533.44
Less Current Tax	162.32	130.28
Less Deferred Tax liability	3.86	4.14
Net Profit / (Loss) After Tax	416.08	399.02

2. Performance Review:

During the financial year (FY) 2025-26 the Total Income stood at Rs. 4,528.71 Lakhs as compared to Rs. 3,360.37 Lakhs in the previous financial year 2024-25, thereby registering an increase of total income by 34.77%. The profit after tax (PAT) for the current FY has increased to Rs. 416.08 lakhs against Rs. 399.02 lakhs in the previous FY, thereby registering an increase in PAT by 4.28%.

3. State of the Company’s Affair:

The Company is a premier provider of complete solutions across Electrical Panels, Industrial Automation, Process Instrumentation, and Industrial Internet of Things (IIoT). Ranked as a preferred System Integrator by top Multinational Companies (MNCs) and enterprise clients, we specialize in converting complex client friction points into scalable engineering solutions.

To sustain this competitive advantage, the Companys technology development roadmap is anchored around three strategic pillars:

• Strategic Expansion & M&A: Driving economies of scale and accelerating market integration.

• New Product Addition: Accelerating the rollout of next-generation product lines to capture emerging market demand.

• Cross-Functional Collaboration: Aligning technological innovation directly with operational and commercial goals.

PRODUCT & SOLUTION PORTFOLIO: -

Product Category	Technical Specifications	Compliance & Integration	Target Applications
Medium Voltage (MV) Panels	Voltage: 3.3-36 kV Current: 630-1250 A	IEC 62271-200 compliant; modular metal-clad design with advanced protective relaying.	Public distribution networks, industrial plants, and critical infrastructure.
Low Voltage (LV) Panels	Voltage: Up to 1000 V Current: Up to 6300 A	IEC 61439 & IS 8623 certified; high short-circuit withstand rating.	Automation-ready setup for PLC, EMS, and SCADA integration.
Automation & IIoT Solutions	Custom PLC, SCADA, VFD, and HMI systems.	Edge/IIoT-enabled architecture for remote visibility, event alerts, and system inter-connectivity.	Real-time monitoring, supervisory control, and end-to-end process optimization.

The strategic long-term investments made during the financial year to prepare the Company for its next phase of expansion:

• Capacity Expansion (Unit-II Setup): Capital expenditure and upfront operational expenses were incurred toward setting up our new manufacturing facility (Unit-II). This will significantly enhance production capacity for Medium Voltage (MV) and Low Voltage (LV) panel lines, though initial setup costs temporarily compressed current-year net margins.

• Commercialization of XLASH.IO™: Targeted R&D, software infrastructure scaling, and go-to-market investments were directed toward establishing our flagship Industrial IoT platform, XLASH.IO™, laying the groundwork for high-margin recurring software and digital solution revenue streams.

• Strategic Talent & Operational Scale-Up: Expanded technical, automation, and project execution teams to seamlessly deliver larger turnkey system integration projects across MNC and enterprise client bases.

These deliberate investments have expanded our operational footprint and market reach. With Unit·II operationalizing and XLASH.IO™ gaining market traction, management anticipates operating leverage to kick in, driving margin expansion alongside top-line growth in the upcoming financial years.

The Company continues to reinforce its leadership across core domains·Industrial Automation, Low Voltage & Medium Voltage Electrical Panels, Industrial Internet of Things (IIoT) solutions, and Power Distribution systems. By expanding operational footprints across key high-growth sectors, including metals, mining, power generation, and continuous process plants, the Company is capturing accelerating market demand for smart, safe, and energy-efficient industrial infrastructure.

To support this growth, the Company is systematically expanding its manufacturing capabilities, accelerating technology R&D, and building specialized engineering talent to deliver next-generation electrification and digitalization systems. Aligning with its long-term strategic vision, the Company is actively diversifying into high- yield segments, including renewable energy integration, infrastructure electrification, and Engineering, Procurement, and Construction (EPC) services.

Equipped with robust turnkey execution capabilities, advanced in-house engineering expertise, and strategic MNC vendor partnerships, the Company is uniquely positioned to deliver complete digitalization, electrical, and automation projects. Management remains confident that these growth initiatives will create sustained enterprise value while solidifying market leadership.

The Company does not have any Subsidiaries or Joint Venture or Associates Companies within the meaning of Section 2 (6) of the Companies Act, 2013.

During the FY under review, the Directors have recommended to transfer entire amount of profit to reserves and surplus for the further expansion of the business. Hence, the amount of profit for the financial year ended March 31, 2026 has been carried forward to the Reserves and Surplus account.

The Board of Directors has not recommended any dividend for the financial year 2025-26. This decision has been taken to conserve resources for the Companys future growth and expansion plans.

There are no shares in suspense account during the year under review.

There are no shares in unclaimed suspense account during the year under review.

Pursuant to the provisions of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, any dividend remaining unclaimed or unpaid for a period of seven years from the date of its transfer to the Unpaid Dividend Account of the Company, along with the corresponding shares on which such dividend has remained unclaimed or unpaid for seven consecutive years or more, is required to be transferred to the IEPF. During the year under review, there was no unpaid or unclaimed dividend liable to be transferred to the IEPF. Since the Company has not declared or not paid any dividend in the previous years, the provisions of Section 125(2) of the Companies Act, 2013 are not applicable.

Pursuant to the provisions of Sections 124 and 125 of the Companies Act, 2013 and the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (as amended), all Equity Shares on which dividend has not been paid or claimed for 7 (seven) consecutive years or more shall be transferred to the Investor Education and Protection Fund (IEPF) authority after complying with the procedure laid down under the said Rules.

During the year under review, there were no equity shares to be transferred to IEPF Account.

During the year under review, the Company has not altered/modified its authorized share capital and has not issued any Equity Shares with Differential Rights as to dividend, voting or otherwise. The Company has not issued any Sweat Equity Shares to its Directors or employees and also has not made any buy back of shares during the year under review.

As on March 31, 2026 the Company has Authorised Share Capital of Rs.. 6,00,00,000/- (Rupees Six Crore Only) divided into 60,00,000 (Sixty Lacs) Equity Shares of Rs.. 10/- (Rupees Ten) each. The Issued, Subscribed & Paid-up Capital for the Company is Rs.. 4,89,04,600/- (Rupees Four crore Eighty-nine lakhs Four thousand Six hundred only) divided into 48,90,460 (Forty-eight lakhs Ninety thousand Four hundred sixty) Equity Shares of Rs.. 10/- (Rupees Ten) each.

During the year, there was no change in the Registered Office of the Company.

The entire shareholding of the Company is in DEMAT (electronics) mode with the National Securities Depository Limited and Central Depository Services (India) Limited ("the Depository Participant") as on March 31, 2026. The ISIN of the Company is INE0U2M01015.

None of the Directors of the Company have incurred any disqualification under Section 164(2) of the Act read with Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014. All the Directors have confirmed that they are not debarred from accessing the capital market as well as from holding the office of Director pursuant to any order of SEBI or MCA or any other such Regulatory Authority.

None of the Director is a director in more than 10 Public Limited Companies or acts as an Independent Director in more than 7 Listed Companies. Further, none of the Directors on the Companys Board is a member of more than 10 (ten) Committees and Chairman of more than 5 (five) Committees (Committees being, Audit Committee and Stakeholders Relationship Committee) across all the Companies in which he/she is a director. All the Directors have made necessary disclosures regarding Committee positions held by them in other companies as on March 31, 2026.

During the period under review, Mr. Shyamal Ghoshroy, Independent Director, (DIN: 08325657) resigned from the Board with effect from August 14, 2025, due to pre-occupation. The Board accepted his resignation and formally recorded its appreciation for his services and contribution during his association with the Company. Consequently, he ceased to be a director and member of all Board Committees in which he served, including the Audit Committee and Nomination and Remuneration Committee effective August 14, 2025.

The Board of Directors, at its meeting held on November 12, 2025, and the Members, via an Extra-Ordinary General Meeting (EGM) on February 10, 2026, appointed Mr. Ullas Pradhan as a Non-Executive Independent Director for a period of five (5) consecutive years, effective November 12, 2025.

Mr. Pranay Agarwal, Independent Director, (DIN: 02758174) resigned from the Board with effect from March 27, 2026, due to pre-occupation. The Board accepted his resignation and formally recorded its appreciation for his services and contribution during his association with the Company. Consequently, he ceased to be a director and member of all Board Committees in which he served, including the Nomination and Remuneration Committee effective March 27, 2026.

The Board, at its meeting held on May 25, 2026, based on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the Members at the ensuing Annual General Meeting (AGM), has approved and recommended to the Members the appointment of Mr. Tapan Kumar Tarania as a NonExecutive Independent Director, for a further period of five (5) years with effect from May 25, 2026.

The necessary resolutions seeking the approval of the members for their re-appointment, along with the Explanatory Statement pursuant to applicable provisions, are included in the Notice convening the 17^th Annual General Meeting (AGM) of the Company.

In accordance with the provisions of the Act and Articles of Association of the Company, Mr. Tapaswini Panda (DIN: 07947214), Wholetime Director, retires by rotation and being eligible, offers herself for re-appointment at the ensuing AGM. Her re-appointment is placed for approval of the Members and forms part of the notice of the 17^th AGM. The information about the Director seeking his re-appointment as per Para 1.2.5 of Secretarial Standards on General Meetings and Regulation.

As on March 31, 2026, the Board of your Company comprises the following Five (5) Directors:

Name	Designation	DIN
Executive Directors: -
Mr. Dhiraj Kochar	Chairman and Managing Director	02721911
Ms. Tapaswini Panda	Whole-time Director	07947214
Mr. Brahmananda Patra	Director	10375562
Non-Executive Directors: -
Mr. Pashupati Nath Kundu	Independent Director	08180863
Mr. Ullas Pradhan	Independent Director	08784984

PS: Mr. Tapan Kumar Tarania (DIN: 11724260) appointed as Non-Executive Independent Director effective from May 25, 2026.

Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel (KMP) of the Company as on March 31, 2026, are:

Mr. Dhiraj Kochar	Managing Director
Ms. Tapaswini Panda	Whole-time Director
Mr. Dhiraj Kochar	Chief Executive Officer
Ms. Tapaswini Panda	Chief Financial Officer
Mr. Priyabrata Nayak	Company Secretary & Compliance Officer

The Company had following Two Independent Directors as on March 31, 2026:

Mr. Pashupati Nath Kundu	Independent Director
Mr. Ullas Pradhan	Independent Director

PS: Mr. Tapan Kumar Tarania (DIN: 11724260) appointed as Non-Executive Independent Director effective from May 25, 2026.

The Independent Directors met once during the financial year 2025-26, i.e., on March 30, 2026 in terms of provisions of Schedule IV of the Companies Act, 2013. All the independent directors of the Company were present at the meeting.

The Independent Directors at the meeting, inter alia, reviewed the following: -

• Performance of Non-Independent Directors and the Board as a whole.

• Performance of the Chairman of the Company, considering the views of Executive Directors and NonExecutive Directors.

• Assessed the quality, quantity and timeliness of the flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

The Company has received declarations from each Independent Director of the Company under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations confirming compliance with the criteria of independence as stipulated under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and there has been no change in the circumstances which may affect their status as Independent Directors during the financial year 2025-26.

All Independent Directors of the Company have affirmed compliance with Schedule IV of the Act and the Companys Code of Conduct for Directors and Employees for the financial year 2025-26.

All the Independent Directors of the Company have registered themselves with the Indian Institute of Corporate Affairs (IICA) towards the inclusion of their names in the data bank and they meet the requirements of the proficiency self-assessment test.

The criteria for determining qualifications, positive attributes, code of conduct and independence of Directors and the policy on familiarization programmes are available on the Companys website https://vdealsystem.com/code-policies.

None of the Independent / Non-Executive Directors has any pecuniary relationship or transactions with the Company which, in the judgment of the Board, may affect the independence of the Directors.

Pursuant to the provisions of the Act, Listing Regulations and as per Guidance Note on Board Evaluation issued by SEBI on 5^th January, 2017, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as evaluation of the working of its committees at their meeting held on March 27, 2026.

The Nomination and Remuneration Committee has defined the evaluation criteria for the performance evaluation of individual Directors, the Board and its Committees. The performance of the Board, its committees and individual Directors were evaluated by the Board after seeking inputs from all the respective Committee members and Directors.

The Company has on the recommendation of the Nomination & Remuneration Committee framed and adopted a Nomination and Remuneration Policy in terms of the Section 178 of the Act. The policy, inter alia lays down the principles relating to appointment, cessation, remuneration and evaluation of Directors, Key Managerial Personnel and Senior Management Personnel of the Company. The Nomination & Remuneration Policy of the Company is available on the website of the Company at web-link https://vdealsystem.com/wp- content/uploads/2024/05/9.-NRC-Policy-updated.pdf.

During the financial year ended on 31^st March, 2026, under review, five (5) Board meetings were held. The maximum interval between any two meetings did not exceed 120 days. The prescribed quorum was presented for all the Meetings and Directors of the Company actively participated in the meetings and contributed valuable inputs on the matters brought before the Board of Directors from time to time. In respect of which meetings proper notice were given and the proceedings were properly recorded and signed including the circular resolutions passed in the Minutes Book maintained for the purpose.

During the year under review, 16^th Annual General Meeting of the Company was held on September 27, 2025 and one 1^st/2025-26 Extra-Ordinary General Meeting was held on February 10, 2026.

The details of Board Meeting held during the Financial Year 2025-26 are:

Sl. No.	Date of Board Meeting	Total Number of Directors as on date of meeting	Attendance
			No. of Directors attended	% of Attendance
1	29-05-2025	6 Nos. (Six Nos)	6 Nos.	100
2	04-09-2025	5 Nos. (Five Nos)	4 Nos.	80
3	12-11-2025	5 Nos. (Five Nos)	5 Nos.	100
4	15-01-2026	6 Nos. (Six Nos)	5 Nos.	83.33
5	27-03-2026	6 Nos. (Six Nos)	5 Nos.	83.33

The details pertaining to the constitution and composition of Committees of the Board and their meetings held during the year are provided in the

Corporate Governance Report as Annexure-II.

As per the requirements of the Act and Listing Regulations, the following Committees were constituted. The composition and the meeting of Committees held during the year are as follows:

A. Audit Committee:

The Composition of the Audit Committee is as follows:

Names	Designation in the Committee	Category
Mr. Pashupati Nath Kundu	Chairman & Member	Independent Director
Mr. Shyamal Ghoshroy	Member (Until 14.08.2025)	Independent Director
Ms. Tapaswini Panda	Member	Whole time Director & Chief Financial Officer
Mr. Ullas Pradhan	Member (From 12.11.2025)	Independent Director

During the financial year 2025-26, the Audit Committee met four (4) times. The meetings were held on May 29, 2025, September 04, 2025, November 12, 2025, and March 27, 2026. The maximum gap between any two meetings was maintained within the statutory timelines prescribed under the Companies Act, 2013 and SEBI (LODR) Regulations.

B. Nomination and Remuneration Committee:

The Composition of the Nomination and Remuneration Committee (NRC) is as follows:

Names	Designation in the Committee	Category
Mr. Ullas Pradhan	Chairman (From 12.11.2025)	Independent Director
Mr. Dhiraj Kochar	Member	Executive Chairman & MD
Mr. Pashupati Nath Kundu	Member	Independent Director
Mr. Pranay Agarwal	Member (Until 27.03.2026)	Independent Director

During the financial year 2025-26, the Nomination and Remuneration Committee met one (1) time. The meeting was held on March 27, 2026.

C. Stakeholders Relationship Committee:

The composition of the Stakeholders Relationship Committee is as follows:

Names	Designation in the Committee	Category
Mr. Pashupati Nath Kundu	Chairman & Member	Independent Director
Mr. Dhiraj Kochar	Member	MD & CEO
Ms. Tapaswini Panda	Member	WTD & CFO

During the financial year 2025-26, the Stakeholders Relationship Committee met one (1) time. The meeting was held on March 27, 2026.

D. IPO Committee:

The composition of the IPO Committee is as follows:

Names	Designation (Chairman/Member)	Category
Mr. Dhiraj Kochar	Chairman & Member	Managing Director & Chief Executive Officer
Ms. Tapaswini Panda	Member	Whole-Time Director & Chief Financial Officer
Mr. Brahmananda Patra	=LEFT>Member	Director

During the financial year 2025-26, no meeting of IPO Committee was held.

E. Corporate Social Responsibility ("CSR") Policy and its committee:

During the period under review, in accordance with the provisions of Section 135 of the Companies Act, 2013, read with the rules thereunder, CSR is not applicable to the Company

During the period under review, the Company maintained its focus on existing business operations without any significant changes in its nature of business. Additionally, the Company expanded its offerings by exploring the Industrial Internet of Things (IIoT) domain and successfully launched its new product, XLASH.IO™, further enhancing its product portfolio and capabilities.

Pursuant to the requirement under Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 with respect to Directors Responsibility Statement, the Board of Directors of the Company hereby state and confirm that:

i. in the preparation of the annual accounts for the financial year ended March 31, 2026, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii. the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at the end of the financial year and of the profit and loss of the company for the year under review;

iii. the directors have 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;

iv. the directors have prepared the annual accounts for the financial year ended March 31, 2026 on a going concern basis;

v. the directors had laid down internal financial controls to be followed by company and that such internal financial controls are adequate and were operating effectively and

vi. 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

Pursuant to Section 92(3) and 134(3)(a) of the Act, the Annual Return of the Company prepared in accordance with Section 92(1) of the Act read with Rule 11 of the Companies (Management and Administration) Rules, 2014, is placed on the website of the Company and is accessible at the web-link: https://vdealsystem.com/annual- report/.

In terms of Regulation 32 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI Circular No. CFD/CMD1/162/2019 dated December 24, 2019 there was no deviation or variation in connection with the terms of the objects of the issue mentioned in the Prospectus dated August 20, 2024, in respect of the Initial Public Offering (IPO) of the Company.

Although the Company has not undergone a credit rating during the period under review, it remains focused on demonstrating its financial health and exploring opportunities to showcase its creditworthiness.

In compliance with Section 177(9) of the Companies Act, 2013, the Board adopted a Whistle Blower Policy on May 20, 2024. The mechanism provides stakeholders, including Directors and individual employees to freely communicate their concerns about illegal or unethical practices and to report genuine concerns to the Audit Committee of the Company.

During the year under review, no concerns were reported under this mechanism. The Whistle Blower Policy of the Company can be accessed at the website of the Company at https://vdealsystem.com/ at the web link https://vdealsystem.com/code-policies/.

Pursuant to the provisions of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company conducted an annual evaluation of the performance of the Board, its Committees, and individual Directors.

During the year, the evaluation cycle was completed internally, covering the Board as a whole, its committees, and individual Directors. The process assessed various aspects of the functioning of the Board and its Committees, including composition, experience, performance of duties, and governance practices. A separate exercise was conducted to evaluate individual Directors based on parameters such as their contribution, independent judgment, guidance and support provided to the Management, attendance at Board and General Meetings, active participation in discussions, decision-making capabilities, and fulfilment of roles as per their designation in the Company.

A. Statutory Auditors:

Pursuant to the provisions of Section 139 and other applicable provisions, if any, of the Companies Act, 2013, read with the rules made thereunder, M/s. Agrawal Uma Shankar & Co., Chartered Accountants (Firm Registration No. 326700E), tendered their resignation from the office of Statutory Auditors of the Company, resulting in a casual vacancy.

To fill the casual vacancy, the Shareholders of the Company, at their Extraordinary General Meeting (EGM) held on February 10, 2026, approved the appointment of M/s. BAPS & Associates, Chartered Accountants, Bhubaneswar (Firm Registration No. 117119W), as the Statutory Auditors of the Company, to hold office until the conclusion of the upcoming 17^th Annual General Meeting (AGM) to be held in the year 2026.

M/s. BAPS & Associates have submitted their written consent and valid eligibility certificate confirming that their continuation as Statutory Auditors is in compliance with the conditions and criteria laid down under Sections 139 and 141 of the Companies Act, 2013, and the Companies (Audit and Auditors) Rules, 2014.

B. Statutory Audit Report:

There are no qualifications, reservations or adverse remarks made by M/s. BAPS & Associates, Statutory Auditors in their report for the financial year ended March 31, 2026.The Auditors Report for the financial year ended March 31, 2026, is annexed to this Annual Report.

C. Internal Auditor:

M/s. DACS & Associates, Chartered Accountants, Bhubaneswar, (Firm Registration No. 326882E) who are the Internal Auditors, have carried out Internal Audit for the financial year 2025-26. Their reports were reviewed by the Audit Committee periodically.

D. Cost Auditor:

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014, the cost records are required to be maintained by your Company and the same are maintained. However, Cost Audit was not applicable to the Company during the year under review.

E. Secretarial Auditor:

The Shareholders at their meeting held on September 27, 2025 had appointed M/s. Sunita Jyotirmoy & Associates, the practicing Company Secretaries, Bhubaneswar, (FRN: P2003OR014400), having peer review certificate no. 7150/2025, as Secretarial Auditors of the Company for a term of 5 years commencing from the FY 2025-26 to the FY 2029-30.

The Secretarial Audit Report in Form MR-3 forms part of the Directors Report as Annexure -1.

Boards Explanation on Secretarial Auditors Observation: The Secretarial Auditor has observed that the Company made a delayed submission under Regulation 23(9) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Disclosures of Related Party Transactions), for which the National Stock Exchange of India Limited (NSE) levied a fine of Rs.5,900/- (Rupees Five Thousand Nine Hundred only). Explanation & Response by the Board of Directors: The Board wishes to clarify that the disclosure under Regulation 23(9) of SEBI LODR Regulations was submitted with a marginal delay of 1 day purely unintentional and occurred due to technical glitches experienced during data aggregation and while uploading at the neaps website of NSE. The Board further highlights that the required disclosure had already been filed with the Stock Exchange prior to the receipt of any notice or SOP demand letter from the NSE. Upon receiving the formal notice for the 1-day delay, the Company promptly remitted the prescribed fine of Rs.5,900/- (comprising Rs.5,000 fine + 18% GST) to the Exchange. The delay was purely unintentional and non-repetitive. To prevent any recurrence, the Board has reinforced the internal regulatory compliance monitoring system and review processes to ensure strict adherence to submission deadlines.

F. Reporting of Frauds by Auditors:

During the year under review, the Statutory Auditors, Internal Auditors, and Secretarial Auditors have not reported any instance of fraud committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Act and the rules made thereunder.

Since there were no qualification and reservation marks in the reports from the Auditors of the Company, there were no comments received from the Board. Moreover, the Board of Directors states that the Company has always adhered to the Companies Act, SEBI Laws, its rules and regulations and all other laws applicable to the Company.

The Company is in compliance with the Secretarial Standards on Meetings of Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India.

Your Company maintains a website https://vdealsystem.com/ where detailed information of the Company and specified details in terms of the Companies Act, 2013 and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 have been provided.

The investor complaints are processed in a centralized web-based complaints redress system. The salient features of this system are centralized database of all complaints, online upload of Action Taken Reports\(ATRs) by the concerned companies and online viewing by investors of actions taken on the complaint and its current status. Your Company has been registered on SCORES and makes every effort to resolve all investor complaints received through SCORES or otherwise within the statutory time limit from the receipt of the complaint. The Company has not received any complaint on the SCORES during financial year 2025-26.

In terms of Section 134(5)(e) of the Act, the term Internal Financial Control means the policies and procedures adopted by a Company for ensuring orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial information.

Internal Control Over Financial Reporting (ICFR) remains an important component to foster confidence in a Companys financial reporting, and ultimately, streamlining the process to adopt best practices. Your Company, through Internal Audit Program is regularly conducting tests of effectiveness of various controls. The ineffective and unsatisfactory controls are reviewed and remedial actions are taken immediately. The internal audit plan is also aligned to the business objectives of the Company which is reviewed and approved by the Audit Committee. Further, the Audit Committee monitors the adequacy and effectiveness of your Companys internal control framework.

Adequate Internal Financial Controls are in place which ensures the reliability of financial and operational information. The regulatory and statutory compliances are also ensured.

Pursuant to Section 186 of the Act, disclosure on particulars relating to loans, advances, guarantees and investments are provided as part of the Financial Statements in notes to the Standalone Financial Statements.

All the Related Party Transactions entered into during the financial year were on an Arms Length basis and in the ordinary course of business. No material significant Related Party Transactions (i.e. exceeding 10% of the annual consolidated turnover as per the last audited financial statement) with Promoters, Directors, Key Managerial Personnel (KMP) and other related parties which may have a potential conflict with the interest of the Company at large, were entered during the year by your Company. The related party transactions entered into by the company during the year under review have been approved by both Audit Committee and the Board. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 is not applicable. Related party disclosures are given in the notes to the financial statement.

The Company has adopted policy on Related Party Transactions and the same can be accessed on the Companys website at https://vdealsystem.com/wp-content/uploads/2024/05/2.-RPT-policv-updated.pdf.

There were no material changes and commitments affecting the financial position of the Company that have occurred between the end of the financial year 2025-26, to which the Financial Statements relate and the date of signing of this report.

The Company has not accepted any deposits falling within the meaning of Section 73 or 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014, during the financial year and as such, no amount on account of principal or interest on deposits from public was outstanding as on 31^st March, 2026.

During the period under review the Company has not accepted money in the form of secured/unsecured loan from the director or relative of the director of the Company.

The Equity Shares of the Company are listed on the SME Emerge platform of NSE (India) Limited. Pursuant to Regulation 15(2) SEBI (Listing Obligation and Disclosure Requirements) Regulation, 2015 the compliance with the Corporate Governance provision as specified in Regulation 17 to 27 and clause (b) to (i) of sub regulations (2) of regulation 46 and par as C, D and E of Schedule V of SEBI (Listing Obligation and Disclosure Requirements) Regulation, 2015 shall not apply. The Company voluntarily adopted various practices of governance conforming to highest ethical and responsible standards of business and is committed to focus on long term value creation for its shareholders. The Corporate Governance practices followed by the Company is included as part of this Report as Annexure-II.

Pursuant to Regulation 34(2)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the Management Discussion and Analysis Report is presented in a separate section Annexure-III forming as part of this Annual Report highlighting the detailed review of operations, performance and future outlook of your Company.

The Companys policy on appointment, removal, remuneration and other matters of Directors, Key Managerial Personnel and Senior Management Personnel including its on- board diversity and succession planning as provided in Section 178(3) of the Companies Act, 2013 can be accessed on the Companys website at https://vdealsystem.com/.

The details as required under Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure - IV of this Report.

In terms of provisions of Section 197(12) of the Act and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing names of the employees drawing remuneration and other particulars, as prescribed in the said Rules forms part of this report. However, in terms of first proviso to Section 136(1) of the Act, the Annual Report, excluding the aforesaid information, is being sent to the Members of the Company.

During the year, the Company had no employee who was employed throughout the financial year or part thereof and was in receipt of remuneration, which in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the Managing Director or Whole-Time Director or Manager and holds by himself or along with his spouse and dependent children, not less than 2% of the Equity Shares of the Company.

Pursuant to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 requires listed companies to lay down a Code of Conduct for its directors and senior management, incorporating duties of directors as laid down in the Companies Act, 2013. As required the said code has been posted on the website of the Company https://vdealsystem.com/. All the Board members and Senior Management personnel have affirmed compliance with the code for the year ended March 31, 2026. A declaration to this effect signed by the Managing Director forms part of the Corporate Governance report.

In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended (PIT Regulations), the Company has adopted the "Code of Conduct to Regulate, Monitor and Report Trading by Insiders" ("the Code"). The Code is applicable to all Directors, Designated persons and Connected Persons and their immediate relatives, who have access to Unpublished Price Sensitive Information relating to the Company.

The Company has also formulated a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI) in compliance with the PIT Regulations. The aforesaid Codes are posted on the Companys website and can be accessed by using web link at https://vdealsystem.com/wp- content/uploads/2024/05/5.-Code-Of-Conduct-For-Prevention-Of Insider-Trading-updated.pdf.

The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI (LODR) Regulations, 2015") mandated the formulation of certain policies for all listed companies. All our Corporate Governance Policies are available on the Companys website, https://vdealsystem.com/code-policies/. The Policies are reviewed periodically by the Board and its Committees and are updated based on the need and new compliance requirement. The following policies has been adopted on duly held Board meeting on 20^th May, 2024 and the same is available at Companies Website.

• Policy for preservation of documents;

• Policy for determination of materiality of events and information;

• Archival Policy;

• Familiarization programme for Independent Directors;

• Nomination & Remuneration Policy;

• Policy on Succession Planning for the Board and Senior Management;

• Board Diversity Policy;

• Code of Conduct for Prevention of Insider Trading;

• Risk Management Policy;

• Policy on Prevention of Sexual Harassment of women at workplace;

• Vigil Mechanism and Whistle Blower Policy;

• Business Integrity Policy;

• Code of Conduct;

• Code of practices and procedures for fair disclosure of unpublished price sensitive information;

• Code of Conduct for Directors, Senior Management and Independent Directors;

• Policy for Procedure of Inquiry in case of leak of unpublished price sensitive information;

• Policy on materiality of related party transactions and dealing with related party transactions and;

• Policy on material creditor and litigation.

The Board of Directors facilitates the execution of Risk Management Practices in the Company, in the areas of risk identification, assessment, monitoring, mitigation and reporting. The Company has formulated and adopted a Risk Management Policy. The Company has been consciously following a policy of risk mitigation by diversifying its products, services, markets and customers. At present the Company has not identified any element of risk which may threaten the existence of the Company.

1. Market Competition & Sourcing Dynamics:

• Risk Identification: The Company operates in business verticals characterized by active market competition, where clients often maintain multiple supplier sources for equipment and integration services to manage supply chain risks.

• Impact Assessment: Highly volatile pressure on pricing power and potential order-share splitting across multi-vendor accounts.

• Mitigation Strategy & Management Action:

o Continuous strategic oversight by Senior Management to track market developments and competitor activity.

o Deepening product differentiation through high-value solutions like XLASH.IO™ and certified IEC- compliant panel assemblies.

o Enhancing operational efficiencies and turnaround times via the upcoming Unit-II manufacturing expansion to remain the preferred primary system integrator for top MNC clients.

2. Global and Domestic Macroeconomic Environment:

The global economic environment continues to witness uncertainties arising from heightened trade tensions, protectionist policy measures, and uneven economic growth across key international markets. Domestically, while industrial momentum remains intact, economic expansion is occasionally moderated by structural challenges, including fiscal constraints, infrastructure implementation delays, and liquidity stress across select financial segments. These factors collectively influence business sentiment, capital expenditure (CapEx) schedules, and private investment cycles across primary industrial sectors.

Geopolitical Volatility & Raw Material Inflation (US-Iran Conflict)

Recent geopolitical escalations·specifically heightened conflict between the US and Iran·have introduced significant volatility into global commodity and energy markets. Disruption to energy supply routes and heightened shipping risk premiums in Middle Eastern transit corridors have driven notable increases in crude oil prices and freight costs.

For the Company, this geopolitical instability impacts input cost dynamics in two distinct ways:

Direct Component Inflation: Spikes in petroleum-derived polymers, insulating resins, copper, and industrial alloys directly increase procurement costs for electrical switchgear, cable harnesses, and panel assemblies.

Logistical & Freight Overheads: Inbound and outbound logistics expenses experience upward pressure due to fuel surcharges and extended maritime transit routes, temporarily compressing gross margins on fixed- price execution contracts.

3. Risk Mitigation & Management Strategy

To insulate business operations against raw material volatility and sectoral cycles, Senior Management actively deploys counter-strategies:

• Contractual Indexation & Forward Hedging: Incorporating raw-material escalation clauses into longterm turnkey supply contracts to pass through sudden commodity cost spikes.

• Strategic Sector Diversification: Expanding presence into counter-cyclical and emerging verticals·such as metals, mining, continuous process industries, power distribution, and renewable energy integration·reducing overall dependence on any single end-user market like automotive.

• Inventory & Vendor Optimization: To shield core operations from global supply chain volatility, the company is actively leveraging long-standing supplier frameworks to establish strategic material buffers for critical metallic and electronic components. By securing safety stock for these high-risk, long-lead inputs, we effectively insulate production schedules against short-term upstream disruptions. Complementing this physical risk mitigation, management has initiated targeted renegotiations across both ends of the value chain. Proactive engagements with key vendors focus on adjusting minimum order quantities, stabilizing pricing structures, and securing prioritized lead times. Concurrently, aligned discussions with customers ensure delivery expectations and contractual timelines reflect current market conditions, maintaining operational continuity and safeguarding overall profit margins.

There were no significant/material orders passed by the regulators or courts or tribunals during the financial year 2025-26, impacting the going concern status and the Companys operations in the future.

Given the nature of activities of your Company, it has not spent any substantial amount on conservation of energy and technology absorption respectively under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. Further, more details have been given in Annexure - Vattached to this report.

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The details of complaints received and disposed of during the financial year 2025-26 are as follows:

Sl. No. Particulars	Remarks
1. Number of complaints of sexual harassment received in the year	Nil
2. Number of complaints disposed of during the year	Nil
3. Number of cases pending for more than ninety days	Nil
4. Number of workshops or awareness programme against sexual harassment carried out	01
5. Nature of action taken by the employer or District Officer	Nil

The Company has complied with the applicable provisions of the Maternity Benefit Act, 1961. All eligible women employees have been extended the benefits as prescribed under the Act. The Company remains committed to supporting working mothers and promoting a gender-inclusive workplace.

In commitment to keep in line with the Green Initiatives and going beyond it, electronic copy of the Notice of 17^th Annual General Meeting of the Company including the Annual Report for FY 2025-26 are being sent to all Members whose e-mail addresses are registered with the Company / Depository Participant(s).

In terms of Regulation 17(8) read with Part B of the Listing Regulations, a certificate from the Chief Executive Officer (CEO) and Chief Financial Officer (CFO) of the company as addressed to the Board of Directors, confirming the correctness of the financial statements, Cash flow statements for the Financial Year ended March 31, 2026, adequacy of the internal control measures and matters reported to the Audit Committee, is provided in this Report.

The Statutory Auditors or Secretarial Auditors or Internal Auditors of the Company have not reported any incident of fraud to the Board of Directors of the Company.

No application was made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (No. 31 of 2016) during the financial year 2025-26.

During the year under review, there has been no one-time settlement of loans taken from banks and financial institutions.

Your Company treats its "human resources" as one of its most important assets. Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused peoples attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement.

Your directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Issue of Bonus Shares and/or Right Shares;

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares to employees of the Company under Employee stock option Scheme.

4. Issue of shares (including sweat equity shares) to directors or employees of the Company under any scheme.

5. Buy Back of Shares.

The Annual Report including those which relate to the Directors Report, Management Discussion and Analysis Report may contain certain statements on the Companys intent expectations or forecasts that appear to be forward looking within the meaning of applicable securities laws and regulations while actual outcomes may differ materially from what is expressed herein. The Company bears no obligations to update any such forward looking statement. Some of the factors that could affect the Company’ s performance could be the demand and supply for Company’ s products and services, changes in Government regulations, tax laws, forex volatility etc.

The Board sincerely thanks the Government of India, SEBI, RBI, the Government of Odisha & other State Governments, customers, business partners, vendors, suppliers, bankers, and shareholders for their continued support, guidance, and cooperation and look forward to their continued support in the future.

The Board also places on record its sincere gratitude and appreciation to all employees at every level of "Vdeal" for their hard work, dedication, and teamwork throughout the year & look forward to enjoying their support & co-operation.

		For and on behalf of the Board of Directors
		VDEAL SYSTEM LIMITED
	Sd./-	Sd./-
Dated: 03.09.2026	Tapaswini Panda	Dhiraj Kochar
Place: Bhubaneswar	Whole-time Director-cum-CFO	Managing Director-cum-CEO
	DIN: 07947214	DIN:02721911