Vels Film International Ltd Directors Report

To,

The Members

Vels Film International Limited

Your Directors are pleased to present the 07 th (Seventh) Directors Report of the company together with Audited Standalone and Consolidated Financial Statements for the year ended March 31, 2026.

1. Financial Performance and Highlights

Your Companys performance during the year ended March 31, 2026 as compared to the previous financial year, is summarized as below:-

(Rs. in Lakhs)

Particulars	Standalone		Consolidated
	Year ended March 31, 2026	Year ended March 31, 2025	Year ended March 31, 2026	Year ended March 31, 2025
Revenue from Operations	150.98	3,426.61	157.98	6,874.20
Other Income	150.25	2,550.12	149.66	2,320.98
Total Income	301.22	5,976.72	307.64	9,195.18
Total Expenditure	2,284.17	4,199.78	2,349.20	9,580.40
Profit / (Loss) before exceptional and extraordinary items and Tax	(1,982.94)	1,776.94	(2,041.56)	(385.22)
Extraordinary items	-	-	-	4,612.79
Profit / (Loss) before Tax	(1,982.94)	1,776.94	(2,041.56)	4,227.56
Tax expenses:	(210.78)	314.76	(210.78)	314.76
Profit / (Loss) after tax	(2,193.72)	1,360.19	(2,252.34)	3,810.81
Earnings per share	(17.00)	10.54	(17.54)	33.34

2. Performance Review

During the year under review, the Company recorded revenue from operations of Rs. 150.98 lakhs, as compared to Rs. 3,426.61 lakhs during the previous financial year. Further, the Company reported a loss of Rs. 2,193.72 lakhs, as against a profit of Rs. 1,360.19 lakhs in the previous financial year. The decrease in revenue and profitability was primarily attributable to the limited number of films released during the financial year 2025-26 and the overall slowdown in the film industry. The limited theatrical releases and the underperformance of certain films at the box office adversely impacted the Companys revenue and profitability.

The Company is taking various measures to improve its financial performance, including increasing the number of film releases, focusing on commercially viable content, and strengthening its production, distribution and marketing strategies. The Company also proposes to optimise production and promotional costs and explore wider theatrical, digital and other distribution opportunities to enhance revenue generation and profitability.

3. Annual Return

The Annual Return of the Company as on March 31, 2026, in Form MGT 7 as per Section 92(3) read with Section 134(3)(a) of the Act, will be available on the Companys website at https://velsfilminternational.com/ AnnualReturn Further, the Annual Return shall be filed by the Company with the Registrar of Companies, Chennai, within the stipulated period and the same can also be accessed thereafter on the Companys website in the link specified above.

4. Details of Directors and Key Managerial Personnel

As required under the Act and SEBI Listing Regulations, the Board is duly constituted with optimum combination of executive and non-executive directors including Independent woman Director. As on March 31, 2026, your Board comprises of 09 (Nine) Directors, which are as follows:

Sl. No. Name of the director	DIN	Designation	Category
1. Dr. Ishari K Ganesh	00269445	Managing Director	Executive / KMP
2. Ms. Arthi	00568101	Director	Non-Executive
3. Ms. Preethaa Ganesh	07105539	Director	Non-Executive
4. Ms. Kushmitha K Ganesh	09271301	Director	Non-Executive
5. Mr. Lushvin Kumaar	11129347	Director	Non-Executive
6. Mr. Thummala Gangatharan Balaji	00580819	Director	Independent
7. Ms. Sangeetha Santharam	07567200	Director	Independent
8. Mr Rangasamy Sivakumar	08336763	Director	Independent
9. Mr. Ayyappa Prasad	11083356	Director	Independent

Changes during the Year a. Appointments Ms. Kushmitha K Ganesh

The Board in its meeting held on June 02, 2025, on the recommendations of the NRC appointed Ms. Kushmitha K Ganesh (DIN: 09271301) as an Additional Director (Non-Executive).

Further, the members at the 6 th (Sixth) Annual General Meeting (AGM) held on July 07, 2025, approved her appointment as a Director (Non-Executive) of the Company, liable to retire by rotation. Ms. Kushmitha is proposed to be appointed as Whole-time Director, for a period of 03 (three) years from October 01, 2026 till September 30, 2029 subject to the approval of the members at the ensuing AGM to be held on September 25, 2026.

Mr. Lushvin Kummar

The Board in its meeting held on June 02, 2025, based on the recommendation of the NRC appointed Mr. Lushvin Kummar (DIN: 11129347) as an Additional Director (Non-Executive).

Further, the members at the 6 th (Sixth) AGM held on July 07, 2025, approved his appointment as a Director (Non-Executive) of the Company, liable to retire by rotation.

Mr. Ayyappa Prasad

The Board in its meeting held on June 02, 2025, based on the recommendation of the NRC appointed Mr. Ayyappa Prasad (DIN: 11083356) as an Additional Director (Independent).

Further, the members at the 6 th (Sixth) AGM held on July 07, 2025, approved his appointment as an Independent Director of the Company.

In the opinion of the Board, he possessed the requisite integrity, expertise, experience and proficiency considered relevant to the Companys business and affairs.

However, subsequent to the financial year, on April 01, 2026, he ceased to be a Director of the Company upon his sudden and untimely demise. The Board and employees of the Company expressed their deepest condolences to his family and placed on record their sincere appreciation for his invaluable contributions, guidance and services rendered to the Company during his tenure as a Director. b. Key Managerial Personnel (KMP)

Pursuant to Section 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company at all times have appointed Whole-time Key Managerial Personnel (KMP) as mentioned therein.

Managing Director

Dr. Ishari Ganesh Kadhirvelan (DIN: 00269445) was appointed as the Managing Director of the Company by the Board at its meeting held on April 30, 2022 with effect from April 30, 2022 , for a term of 05 (five) consecutive years He is proposed to be re-appointed as Managing Director, further term of 03 (three) consecutive years commencing from April 30, 2027 and ending on April 29, 2030 subject to the approval of the members at the ensuing AGM to be held on September 25, 2026.

Chief Financial Officer

During the year, Mr. Srinivasan Rajagopal resigned as Chief Financial Officer (CFO) of the Company w.e.f. May 31, 2025. The Board, at its meeting held on June 02, 2025, took note of his resignation from the said office.

Subsequently, the Board based on the recommendation of the NRC at their meetings held on October 09, 2025 appointed Mr. Muthukrishnan Srinivasan as the CFO of the Company.

As per Section 203 of the Act, the vacancy in the office of the CFO was filled within 06 (six) months.

Company Secretary and Compliance Officer

During the year, Ms. Sujatha Sampathkumar (ACS: 32181) resigned from the office of Company Secretary and Compliance Officer w.e.f. January 31, 2026. The Board, at its meeting held on January 31, 2026, took note of her resignation from the said office.

After the financial year, the Board, at its meeting held on April 15, 2026, appointed

Mr. Praveen Kumar (ACS: 76575) as the Company Secretary and Compliance Officer of the Company. As per Regulation 6 of the SEBI Listing Regulations, the vacancy in the office of the Compliance Officer was filled within 03 (three) months.

Meetings of the Board

During the financial year 2025-26, the Board met 10 (Ten) times. The maximum time gap between any two consecutive meetings did not exceed 120 (one hundred and twenty) days.

Details of meetings held and attendance of directors are as below:

Sl. No. Date of Meeting	No. of Directors entitled to attend the meeting	No. of Directors present at the meeting
1. May 07, 2025	6	6
2. May 29, 2025	6	6
3. June 02, 2025	6	6
4. June 12, 2025	9	9
5. August 21, 2025	9	9
6. October 09, 2025	9	9
7. November 05, 2025	9	9
8. November 14, 2025	9	9
9. January 31, 2026	9	9
10. March 26, 2026	9	8

All the Directors were present in all the meetings, except for Mr. Ayyappa Prasad, who was granted Leave of Absence on March 26, 2026 owing to illness.

5. Independent Directors

As required under the Act and SEBI Listing Regulations, the Company has 04 (four) Independent Directors as on March 31, 2026:

i. Mr. Thummala Gangatharan Balaji;

ii. Ms. Sangeetha Santharam;

iii. Mr Rangasamy Sivakumar and

iv. Mr. Ayyappa Prasad.

Familiarisation Programme

The Company has put in place a structured Familiarisation Programme for Independent Directors to enable them to gain an understanding of the Companys business, operations, industry dynamics, organisational structure, governance framework, strategic priorities, risk management framework and the statutory and regulatory environment applicable to its operations. The Programme facilitates effective participation of Independent Directors in the deliberations of the Board and its Committees and enables them to discharge their fiduciary, statutory and governance responsibilities effectively.

As part of the Programme, Independent Directors are provided with relevant corporate presentations, annual reports, financial and operational updates, internal policies and other pertinent information and are facilitated interaction with the Senior Management, wherever appropriate. The Company Secretary acts as a key facilitator and provides necessary information, clarifications and guidance on the Companys policies, procedures and applicable statutory and regulatory requirements. The details of the Familiarisation Programme, including the requisite disclosures under the Act and SEBI Listing Regulations, are made available on the Companys website at www.velsfilminternational.com.

Meeting of the Independent Directors

Pursuant to Schedule IV of the Act, the Independent Directors of the Company met separately on January 09, 2026, without the presence of the Non-Independent Directors and members of the management. At the said meeting, the Independent Directors reviewed the performance of the Non-Independent Directors, including the Chairman of the Company taking into account the views of executive directors and non-executive directors, performance of the Board as a whole and assessed the quality, quantity and timeliness of the flow of information between the Companys management and the Board.

6. Details of Committees of the Board

The Board has constituted the following Committees in accordance with the applicable provisions of the Act and SEBI Listing Regulations, where applicable: i. Audit Committee; ii. Corporate Social Responsibility Committee; iii. Nomination and Remuneration Committee and iv. Stakeholders Relationship Committee.

There was no change in the composition of any of the Committees of the Board during the financial year 2025-26. i. Audit Committee

As per Section 177 of the Act, the Audit Committee is duly constituted with following members: Mr. Thummala Gangatharan Balaji, Chairman, Independent Director; Dr. Ishari K Ganesh, Member, Managing Director; and Mr. Rangasamy Sivakumar, Member, Independent Director.

The primary objective of the Audit Committee is to assist the Board of Directors in discharging its oversight and fiduciary responsibilities with respect to the integrity of the Companys financial reporting, internal financial controls, risk management framework, audit processes and regulatory compliance. The Committee, inter alia, reviews the financial statements and financial results, adequacy and effectiveness of internal financial controls and risk management systems, related party transactions, internal and statutory gs, significant observations and management responses, and oversees the independence and effectiveness of the audit functions.

The Committee acts as an effective governance interface amongst the Board, Management, Internal Auditors and Statutory Auditors, facilitating transparency, financial discipline, accountability and informed decision-making. It also reviews the adequacy of internal control mechanisms, compliance with applicable laws and regulatory requirements, and monitors corrective and remedial measures arising from audit observations. During the financial year 2025-26, the Committee duly discharged its responsibilities in accordance with its terms of reference and applicable statutory and regulatory requirements and all recommendations made by the Committee during the year were accepted by the Board of Directors.

During the financial year 2025-26, the Audit Committee met 03 (Three) times.

Details of meetings held and attendance of Members are as below:

Sl. No. Date of Meeting	No. of Members entitled to attend the meeting	No. of Members present at the meeting
1. May 07, 2025	3	3
2. June 12, 2025	3	3
3. November 14, 2025	3	3

All the Members of the Audit Committee were present in all the meetings. ii. Corporate Social Responsibility Committee

As per Section 135 of the Act, the Corporate Social Responsibility Committee is duly constituted with following members: Mr. Thummala Gangatharan Balaji, Chairman, Independent Director; Dr. Ishari K Ganesh, Member, Managing Director; and Mr. Rangasamy Sivakumar, Member, Independent Director.

During the financial year 2025-26, the Company continued to support and promote initiatives in the field of Education as per Schedule VII of the Act. Being part of the Vels Group, which has a strong presence in the education sector, the Company endeavours to leverage its institutional capabilities and ecosystem towards advancing educational opportunities and contributing to the development of society.

The Company has formulated and adopted Corporate Social Responsibility (CSR) Policy outlining its CSR philosophy, focus areas, governance framework and implementation approach. The CSR Policy is available on the website of the Company and may be accessed through the prescribed web link @ https:// velsfilminternational.com/PDF/Policy/CSR-Policy.pdf.

The details of the CSR Policy, CSR activities undertaken and other disclosures for the financial year 2025-26, as per the Act and the rules made thereunder, are set out in Annexure I forming part of this Report. During the financial year 2025-26, the Corporate Social Responsibility Committee met 02 (Two) times.

Details of meetings held and attendance of Members are as below:

Sl. No. Date of Meeting	No. of Members entitled to attend the meeting	No. of Members present at the meeting
1. May 07, 2025	3	3
2. January 31, 2026	3	3

All the Members of the CSR Committee were present in all the meetings. iii. Nomination and Remuneration Committee

As per Section 178 of the Act, the Nomination and Remuneration Committee is duly constituted with following members: Mr. Thummala Gangatharan Balaji, Chairman, Independent Director; Mr. Arthi, Member, Non-Executive Director; and Mr. Rangasamy Sivakumar, Member, Independent Director.

The primary objective of the Committee is to assist the Board in ensuring an appropriate balance of skills, experience, expertise, diversity and independence in the composition of the Board and senior leadership. The Committee oversees the framework for identification, evaluation, appointment and succession of Directors, Key Managerial Personnel and Senior Management Personnel, and formulates appropriate criteria for determining their qualifications, positive attributes, independence and performance. It is responsible for recommending to the Board a coherent and merit-based remuneration framework for Directors, KMPs and Senior Management Personnel, having regard to their qualifications, experience, responsibilities, performance and prevailing industry practices.

The Committee also oversees the evaluation of the performance of the Board, its Committees and individual Directors, reviews succession planning and leadership continuity and ensures that remuneration practices remain aligned with the Companys strategic objectives, performance orientation, stakeholder interests and applicable statutory and regulatory requirements.

The Committee thereby endeavours to strengthen the Companys governance architecture through transparent, objective and accountable processes for talent management, leadership development and remuneration.

Further, the Committee has formulated Nomination and Remuneration policy (NRC Policy) as required under Section 178(4) of the Act and the same is available at the Website of the Company @ https:// velsfilminternational.com/PDF/Policy/nomination-and-remuneration-policy.pdf

The salient features of the NRC Policy are set out below:

Board Composition & Diversity - Ensures an appropriate balance of skills, experience, expertise, qualifications, competencies and diversity in the composition of the Board.

Appointment & Succession Planning - Provides a structured and transparent framework for identification, appointment, reappointment, succession and removal of Directors, KMPs and Senior Management Personnel.

Performance Evaluation - Establishes a framework for periodic performance evaluation of the Board, its Committees, individual Directors, KMPs and Senior Management Personnel.

Remuneration Framework - Lays down principles for determining fair, reasonable, competitive and performance-linked remuneration of Directors, KMPs and Senior Management Personnel, commensurate with their responsibilities, qualifications and experience.

Independence & Governance - Prescribes criteria relating to independence, integrity, positive attributes and suitability of Directors and promotes transparent, merit-based and stakeholder-oriented governance in accordance with applicable statutory and regulatory requirements.

During the financial year 2025-26, the Nomination and Remuneration Committee met 04 (Four) times.

Details of meetings held and attendance of Members are as below:

Sl. No. Date of Meeting	No. of Members entitled to attend the meeting	No. of Members present at the meeting
1. May 07, 2025	3	3
2. June 02, 2025	3	3
3. June 12, 2025	3	3
4. October 09, 2025	3	3

All the Members of the Nomination and Remuneration Committee were present in all the meetings. iv. Stakeholders Relationship Committee

As per Section 178 of the Act, the Stakeholders Relationship Committee is duly constituted with following members: Mr. Thummala Gangatharan Balaji, Chairman, Independent Director; Mr. Arthi, Member, Non-Executive Director; and Ms. Sangeetha Santharam, Member, Independent Director.

Although the Company is not mandatorily required to constitute a Stakeholders Relationship Committee, the Board, in furtherance of its commitment towards stakeholder-centric governance, investor protection, transparency and effective shareholder engagement, has voluntarily constituted the Committee. The Committee serves as a governance mechanism for safeguarding the interests of shareholders and other security holders and oversees the Companys framework for investor grievance redressal, including matters relating to shares, transmission of securities and other shareholder-related concerns. The Company remains committed to maintaining responsive investor communication, transparency and timely grievance resolution. During the financial year 2025-26, no complaints were received through the SEBI Complaints Redress System (SCORES) , reflecting the effectiveness of the Companys investor service and grievance redressal mechanisms and its continued focus on protecting stakeholder interests. Further, the Company Secretary and Compliance Officer of the Company acts as the designated official for handling the investor / stakeholder grievances.

During the financial year 2025-26, the Stakeholders Relationship Committee met once.

Details of meetings held and attendance of Members are as below:

Sl. No. Date of Meeting	No. of Members entitled to attend the meeting	No. of Members present at the meeting
1. March 26, 2026	3	3

All the Members of the Stakeholders Relationship Committee were present in the meeting.

7. Directors Responsibility Statement:

Pursuant to Section 134 (3) (c) of the Act your Directors confirm that:

i. In the preparation of the annual accounts, the applicable accounting standards had 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 at the end of the financial year ended March 31, 2026 and of the loss of the Company for financial year ended March 31, 2026;

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 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 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.

8. Details in respect of frauds reported by auditors

No frauds have been reported by the Auditors of the Company during the financial year 2025-26.

9. Declaration given by Independent Directors

The Company has received declarations from all the Independent Directors of the Company conurming that they meet the criteria of independence as prescribed both under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations) .

The Independent Directors of the Company have also registered their names in the data bank for Independent Directors maintained by the Indian Institute of Corporate Affairs (IICA) .

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise and are independent of the management.

10. Remuneration Policy

The Board of Directors on the recommendation of the Nomination and Remuneration Committee (NRC) has framed a Policy for Directors, Key Managerial Personnel and other Senior Managerial Personnel of the Company, in accordance with the requirements of the provisions of Section 178 of the Act and SEBI Listing Regulations. The web link for the policy is https://velsfilminternational.com/PDF/Policy/nomination-and-remuneration-policy.pdf

11. Auditors and their reports thereon

i. Statutory Auditor:

Pursuant to the provisions of Section 139 of the Act, the members in their 6 th (Sixth) Annual General Meeting held on July 07, 2025 re-appointed M/s. S R B R & Associates LLP, Chartered Accountants, Chennai (FRN 004997S / S200051) as Statutory Auditors for a term of 04 (four) years to hold office till the conclusion of AGM of the Company to be held in the year 2029.

The Auditors Report on both standalone and consolidated basis for the financial year 2025-26 does not contain any qualification, reservation or adverse remark or disclaimer.

ii. Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Act, the Board in its Meeting held on April 27, 2026 appointed M/s. Chitra Lalitha & Associates, Practicing Company Secretaries (Peer Review Certificate No. 6325/2024) to undertake the Secretarial Audit for the financial year 2025-26.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer. The said report in Form MR 3 is attached to this report Annexure II .

iii. Internal Auditor:

Pursuant to the provisions of Section 138 of the Companies Act, 2013, the Board in its Meeting held on April 27, 2026 appointed M/s. Rajesh Samdaria & Associates, Chartered Accountants, Chennai (FRN 07662S) as Internal Auditor of the Company for conducting internal audit of the Company for the financial year 2025-26.

The Board in its meeting held on May 14, 2026, took note of the consolidated Internal Auditors Report for the financial year 2025-26.

12. Subsidiary and Associate Company

Subsidiary Company - Vels D Studios LLP (55% of Capital Contribution) Associate Company - NIL

A statement containing salient features of the financial statements of Companys Subsidiary is given in the prescribed Form AOC 1 as an Annexure III .

During the financial year 2025-26, there were no companies which ceased to be subsidiaries, associates or joint ventures of the Company.

13. Loans, Guarantees or Investments i. Loans

The Company has not given any Loans during the financial year 2025-26. ii. Investments

The Board, at its meeting held on November 05, 2025, accorded its approval for an investment of 1 55,000/ - (Rupees Fifty Five Thousand only), 55% of Capital Contribution in Vels D Studio LLP (LLPIN: ACT-0294) towards capital contribution.

The Company has contributed 55% (fifty-five percent) of the total capital contribution of VDS and accordingly VDS became a subsidiary of the Company.

iii. Guarantees

The Board, at its meeting held on March 26, 2026, accorded its approval for providing a Corporate Guarantee in favour of Bank of Baroda amounting to Rs. 3,44,85,000/- (Rupees Three Crores Forty Four Lakhs Eighty Five Thousand only) in respect of the credit facilities availed by Vels D Studio LLP, a subsidiary of the Company.

Further, the Company is within the overall limits approved by the members under Section 186 of the Act.

14. Particulars of Contracts or Arrangements with Related Parties

All contracts, arrangements and transactions entered into by the Company with related parties during the financial year 2025-26 were in the ordinary course of business and on an arms length basis, wherever applicable, and were in compliance with the applicable provisions of Section 188 of the Act. Further, there were no material contracts or arrangement or transactions not at arms length basis and hence disclosure in form AOC 2 is not required.

Further, the details of the related party transactions as per AS 18 are set out in Note No. 3(F) to the Standalone Financial Statements of the Company.

15. Amount, which the board proposes to carry any Reserves

During the year, the Company has incurred a loss of Rs. 2193.72 Lakhs (Rupees Twenty One Crore Ninety Three Lakh Seventy Two Thousand Only). Therefore, the Company has not transferred any amount to the reserves during the financial year 2025-26.

16. Dividend

The Board of Directors of the Company have not recommended any dividend for the financial year 2025-26.

17. Material changes and commitments between the date of the Balance Sheet and the Date Of Report

There have been no material changes and commitments affecting the financial position of the Company which have occurred between the date of the Balance Sheet and the date of this Report.

18. Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo:

The Company is engaged in the business of film production, distribution and entertainment. Since the Companys business does not involve any manufacturing activity and is primarily service oriented, most of the information required to be provided under Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014, is not applicable to the Company. The information, as applicable to the Company, is provided hereunder: i. Conservation of Energy:

The operations of the Company are primarily in the film production and entertainment sector and are not energy-intensive in nature. Nevertheless, the Company continues to adopt reasonable measures for conservation and optimum utilisation of energy in its office and operational activities. The Company endeavours to use energy efficient equipment and technology, wherever feasible, and encourages responsible use of electricity and other energy resources. ii. Absorption of Technology:

The Company operates in the film and entertainment industry, wherein technology plays an important role in film production, post-production, content development and related activities. The Company continues to adopt and utilise contemporary technologies and digital tools relevant to its operations, with a view to improving efficiency, quality and productivity. During the year under review, the Company did not undertake any significant indigenous technology development or technology transfer requiring specific disclosure under this clause. iii. Foreign Exchange Earnings and Outgo

(Rs. in Lakhs)

Particulars	March 31, 2026	March 31, 2025
Foreign Exchange Earnings	601.51	-
Foreign Exchange Outgo	-	129.16

19. Risk Management

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified are systematically addressed through mitigating actions on a continuing basis. These are discussed at the Meetings of the Audit Committee and the Board of the Company. For details, please refer to the Management Discussion and Analysis report which form part of the Boards Report.

20. Annual Evaluation

Pursuant to the provisions of the Act, Nomination and Remuneration Committee has carried out an Annual Performance Evaluation of the Board and of the Individual Directors has been made. During the financial year 2025-26, the Evaluation was done in following manner based on the criteria approved by NRC:

(i) The Board as a whole;

(ii) Each Committee and its members;

(iii) The performance of the Non-Independent Directors was reviewed and evaluated and

(iv) The performance of the Managing Director was evaluated by the Board, taking into account the views of the Non-Executive Directors.

The Evaluation process focused on various aspects of the Board and Committees functioning such as composition of the Board and Committees, experience, performance of duties and governance issues etc., Separate exercise was carried out to evaluate the performance of individual Directors on parameters such as contribution, independent judgment and guidance and support provided to the Management. The results of the evaluation were shared with the Board, Chairman of respective Committees and individual Directors.

21. Change in the nature of business

There was no change in the nature of business of the Company during the financial year 2025-26. However, the Company continues to explore new opportunities and ventures within its existing business domain with a view to expanding its operations and strengthening its presence in the film and entertainment industry.

22. Deposits

During the financial year 2025-26, the Company did not accept any deposits in terms of Section 73 of the Act read with the Companies (Acceptance of Deposit) Rules, 2014.

Accordingly, there were no deposits which were not in compliance with the requirements of Chapter V of the Act during the financial year.

23. Details of significant and material orders

There were no significant or material orders passed by any regulators, courts or tribunals during the financial year 2025-26 which have an impact on the going concern status of the Company or its operations in future.

24. Internal Financial Controls

The Company has put in place adequate Internal Financial Controls with reference to the Financial Statements, commensurate with its size and nature of business, which are designed to ensure the orderly and efficient conduct of its business, adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information. The Board is responsible for ensuring that such controls are adequate and operating effectively in accordance with the requirements of the Companies Act, 2013.

The Audit Committee evaluated the adequacy and operating effectiveness of the Internal Financial Controls with reference to the Financial Statements through discussions with the Statutory Auditors and Key Managerial Personnels. The Statutory Auditors also reviewed the existing Internal Financial Control system and its operating effectiveness and expressed their satisfaction thereon. Based on the evaluation and discussions, no reportable material weakness in the operation of the Internal Financial Controls was observed during the financial year.

25. Cost Audit and its Report

The provisions relating to maintenance of cost records and cost audit under Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, are not applicable to the Company, as the nature of activities and business operations carried out by the Company do not fall within the classes of companies or industries specified under the said provisions.

Accordingly, the Company is not required to maintain cost records under Section 148 of the Act and, consequently, the appointment of a Cost Auditor and submission of a Cost Audit Report is not applicable to the Company for the financial year 2025-26.

26. Internal Complaints Committee

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder.

Details of complaints during financial year 2025-26 :

Sl. No. Particulars	Details
a. Number of complaints of sexual harassment received in the year	NIL
b. Number of complaints disposed off during the year	NIL
c. Number of cases pending for more than ninety days	NIL

27. Details of Application made or proceeding pending under Insolvency and Bankruptcy Code, 2016

No application has been made and no proceeding is pending against the Company under the Insolvency and Bankruptcy Code, 2016 (IBC) during the financial year. Accordingly, the requirement to disclose the details and status of any such application or proceeding is not applicable to the Company.

28. Details of Difference in Valuation at One Time Settlement and Loan Availment

There was no difference between the valuation amount at the time of one-time settlement and the valuation undertaken while availing loans from banks or financial institutions financial year. Accordingly, the requirement to disclose the details is not applicable to the Company.

29. Compliance of the provisions relating to the Maternity Benefit Act, 1961

The Company is in compliance with the applicable provisions of the Maternity Benefit Act, 1961, as amended from time to time. The Company extends the benefits and facilities prescribed under the Act to women employees, wherever applicable.

30. Capital Structure

The Company has only one class of equity shares, having a face value of 1 10/- (Rupees Ten only) each. The authorised, issued, subscribed and paid-up share capital of the Company as at March 31, 2026 is as follows:

Particulars	No. of Shares	Amount (in Rs. )
Authorised Capital	2,00,00,000	20,00,00,000/-
Issued, Subscribed and Paid-up Capital	1,29,08,000	12,90,80,000/-

During the financial year 2025-26, there was no change in the Authorised, Issued, Subscribed and Paid-up share capital of the Company and the Company has neither issued any equity shares with differential rights as to dividend, voting or otherwise nor any shares or securities of any other class.

31. Management Discussion and Analysis

A detailed report on Management Discussion and Analysis (MDA) Report is included in this Report as Annexure IV .

32. Credit Rating

During the financial year 2025-26, the Company neither obtained any Credit Rating nor was required to be obtained by the company.

33. Corporate Governance

Pursuant to Regulation 15(2)(a) of the SEBI Listing Regulations, the provisions relating to corporate governance requirements are not applicable to the Company, as its securities are listed on the SME Platform of National Stock Exchange (NSE Emerge) . Accordingly, the disclosures prescribed under the said provisions do not form part of this Directors Report.

Notwithstanding the aforesaid exemption, the Company remains committed to the highest standards of corporate integrity, transparency, accountability and ethical conduct and has voluntarily adopted appropriate corporate governance principles and practices. The Company has accordingly instituted suitable governance mechanisms, policies, processes and internal controls to ensure effective oversight, prudent decision making, regulatory compliance and protection of the legitimate interests of its stakeholders.

34. Vigil Mechanism

In accordance Section 177 (9) of the Act, the Company has established a Vigil Mechanism / Whistle Blower Policy enabling Directors and employees to report concerns relating to unethical conduct, actual or suspected fraud, misconduct or violation of the Code of Conduct, with adequate safeguards against victimisation.

The Company is committed to maintaining the highest standards of integrity, transparency, accountability and ethical conduct.

All reportable matters may be directly reported to the Chairman of the Audit Committee and the Company confirms that no person has been denied access to the Audit Committee. The Vigil Mechanism / Whistle Blower Policy is available on the Companys website at https://velsfilminternational.com/PDF/Policy/ whistle-blower-policy.pdf

35. Details of Remuneration of Employees

Disclosures relating to remuneration and other particulars, as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are set out in Annexure V to this Report.

Further, none of the employees of the Company draw remuneration exceeding the thresholds prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Accordingly, the disclosure requirements stipulated under the said Rule is not applicable to the Company.

36. Compliance of Secretarial Standards 1 and 2

Your Directors confirms that pursuant to Section 118(10) of the Act applicable Secretarial Standards, i.e., SS 1 on Meetings of the Board of Directors and SS 2 on General Meetings issued by the Institute of Company Secretaries of India (ICSI) have been duly complied with by the Company.

37. Cautionary Statement

Statements in this Report, particularly those which relate to Management Discussion and Analysis as describing the Companys objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ from those either expressed or implied in the statement depending on the circumstances.

38. Acknowledgement

The Company, Board of Directors and KMPS place on record their sincere appreciation for the continued support and cooperation extended by its employees, investors, vendors, bankers and other stakeholders.

The Board also acknowledges the valuable cooperation and guidance received from various Government and regulatory authorities, including Ministry of Corporate Affairs, Tax Authorities, NSDL and the National Stock Exchange. The Directors further appreciate the dedication, commitment and contribution of the employees at all levels, whose collective efforts and support have been instrumental in the Companys progress during the year.

For and behalf of the Board

Vels Film International Limited

Sd/-	Sd/-
Dr. Ishari K Ganesh	Arthi
Managing Director	Director
DIN: 00269445	DIN: 00568101
Place: Chennai
Date: August 27, 2026