Dear Members,

Your directors are pleased to present the 4/ h Annual Report on the business and operations of Precision Electronics Limited ("the Company" or "PEL") along with the Audited Statements of Accounts for the Financial Year ended March 31, 2026.

FINANCIAL HIGHLIGHTS

The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (" Ind AS ") notified under section 133 of The Companies Act, 2013 ("the Act"), read with rule 7 of The Companies (Accounts) Rules, 2014 (" the Accounts Rules ").

Pursuant to and in compliance with the provisions of section 134(3) read with rule 8 of the Accounts Rules, the financial performance of the Company for the Financial Year ended on March 31, 2026, is summarized below:

(Rs. in Lakh)

*Revenue is net of Goods and Services Tax.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION

There have been no material change(s) and commitment(s), except elsewhere provided in this report, affecting the financial position of the Company between the end of the financial year of the Company i.e. March 31, 2026, and the date of this report.

CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of the business of the Company during the financial year ended on March 31, 2026.

DIVIDEND

In view of conservation of financial resources of the Company, no dividend is recommended for the financial year under review (previous year nil).

TRANSFER TO RESERVES

Details of the amount which the Company carries to reserves are provided in Note No. 18 to the Financial Statements. OPERATIONAL HIGHLIGHTS AND STATE OF THE COMPANY'S AFFAIRS

Overall revenue of the Company for the year ended March 31, 2026, was recorded at about Rs.7,973.79 lakh with a Profit before Tax (PBT) of Rs.143.51 lakh as compared to the previous Financial Year 2024-25 revenue of Rs.4,748.38 lakh and PBT of Rs.18.81 lakh respectively.

The Company has continued to strengthen its manufacturing and defence-oriented business, resulting in a significant evolution in the nature and revenue profile of its operations.

Accordingly, based on the nature of its business, revenue profile and internal reporting, and in accordance with Ind AS 108 - Operating Segments, the Company's existing single reportable operating segment, earlier described as "Telecom", has been revised to "Defence", effective from FY 2026-27.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

(I) INDUSTRY STRUCTURE AND DEVELOPMENTS

A. Indian Defence Manufacturing:

India's defence manufacturing sector continued to expand during FY 2025-26, supported by higher domestic procurement, progressive indigenisation, and increasing private-sector participation. Indigenous defence production reached approximately Rs.1.78 lakh crore during FY 2025-26, representing growth of 15.6% over the preceding financial year. The private sector accounted for approximately 24% of total production, reflecting its increasing participation in the domestic defence manufacturing ecosystem.

Indian defence exports reached a record Rs.38,424 crore during FY 2025-26, an increase of 62.66% over the preceding year, with Indian defence products being exported to more than 80 countries. The private sector contributed approximately 45% of total defence exports during the year.

The Union Budget for FY2026-27 allocated approximately Rs.2.19 lakh crore under the capital head. Of the Rs.1.85 lakh crore allocated for capital acquisition, approximately Rs.1.39 lakh crore, representing around 75%, has been earmarked for procurement from the domestic defence industry. These allocations, together with the Government's preference for indigenous procurement under the Defence Acquisition Procedure, are expected to support continued growth of the Indian defence manufacturing base.

These developments create opportunities for qualified Indian manufacturers of defence electronics, precision-engineered components, tactical infrastructure and related subsystems. However, the timing of orders will continue to be influenced by procurement cycles, trials, customer qualification and program-specific approvals.

B. Global Defence Spending:

Global military expenditure reached approximately $ 2.89 trillion in 2025, recording its eleventh consecutive annual increase. While global expenditure increased by 2.9% in real terms, defence expenditure in Europe increased by approximately 14%, reflecting accelerated investment in military preparedness and industrial capacity.

The NATO commitment to progressively increase expenditure on core defence, infrastructure, resilience and defence-industrial capacity is also expected to support sustained investment over the medium to long term.

The expansion in international defence expenditure creates opportunities for Indian companies capable of meeting global requirements for product quality, qualification, traceability, delivery assurance, and lifecycle support.

C. Drone and Counter-Unmanned Aerial Systems ('UAS') Ecosystem:

The growing operational use of unmanned aerial systems has increased the requirement for surveillance, detection, command-and-control, electronic-warfare and counter-UAS capabilities. During FY 2025-26 and subsequently, the Ministry of Defence announced procurement and acquisition approvals covering integrated drone detection and interdiction systems, low-level radars and anti-UAV electronic-warfare systems.

Counter-UAS systems frequently require the rapid deployment of radars, electro-optical sensors, communications equipment and other payloads at suitable elevations. The Company's telescopic masts, tripods and pedestals provide deployable infrastructure for such payloads and are already used in selected defence communication, surveillance and counter-UAS applications.

Based on its existing orders, customer engagements and product development activities, Management expects surveillance, communication and counter-UAS applications to remain an important source of opportunity for the Company. Actual business conversion will, however, depend upon customer qualification, program timelines, system configuration and the Company's participation in individual procurements.

D. Tactical Infrastructure and Defence Communications:

Military operations increasingly require mobile, rapidly deployable and networked communication and surveillance systems capable of functioning across varied terrain and operating conditions. Recent Indian procurement initiatives include high-capacity radio-relay systems, software-defined radios, mobile electronic systems, surveillance systems and air-defence radars.

These programs support demand for associated tactical infrastructure, including masts, tripods, pedestals, equipment mounts, power-distribution products and precision-engineered components. The Company intends to address these opportunities through its existing product portfolio, product customisation capabilities and relationships with defence System Integrators.

E. International Supply Chains and Exports:

International aerospace and defence companies are increasingly focused on supply-chain resilience, geographic diversification and the development of qualified manufacturing partners. India's expanding defence exports and its increasing participation in global aerospace programs demonstrate the progressive integration of Indian manufacturing into international supply chains.

The Company believes that its experience in precision manufacturing, tactical infrastructure, quality-controlled production and defence customer requirements provides a foundation for participation in international sourcing and export programs. Conversion of such opportunities will depend on customer audits, product and process qualification, competitive pricing, delivery performance and compliance with applicable export- control requirements.

(II) OPERATIONAL HIGHLIGHTS AND STATE OF AFFAIRS:

The Company's revenue of about Rs.7,973.79 lakh in the Financial Year 2025-26 against approximately Rs.4,748.38 Lakh in the preceding year implies a growth of nearly 68%. The Profit after tax for the year was Rs.60.90 lakh as against a loss of Rs.57.64 lakh in the previous financial year. This growth has been driven primarily by strong execution of manufacturing orders, increasing demand for precision machined components and sustained orders for the Company's Telescopic Mast product range.

Financial performance for year under review is provided in Financial Highlights as above.

The Company's order book at the close of the financial year as at March 31, 2026 was about Rs.40 Crore and subsequent orders as on 1st August 2026 stood at about Rs.72 Crore, of which about Rs.69 Crore is for delivery within the current financial year. Orders cover precision machined components, Telescopic Masts and electronic systems for Defence & Security sectors. The strong order book provides healthy revenue visibility for the current financial year.

During the year under review, the Company initiated the phased shifting of its operations from its Noida facility to its leasehold manufacturing facility at Ballabhgarh, Faridabad, Haryana ("Ballabhgarh Facility"). The Ballabhgarh Facility comprises a plot area of approximately 8,000 Sq. Mt. with more than 8,000 Sq. Mt. of constructed space.

Mast production facility is housed in about 2,100 Sq. Mt. Hall that offers unimpeded production line for each variety viz Pneumatic, Electro-Mechanical, Tripods with testing stations, a 10M high storage racks and sub system assembly areas. The production capacity is expected to increase to 4,000 masts per annum from the current capacity of 1,200 at Noida facility. The Ballabhgarh facility provides the infrastructure to support future growth, improved productivity and operational efficiencies.

The machining vertical is housed in a shop floor area of about 4,200 Sq Mt and has a capacity of more than 100

CNC/VMC machines in addition to store area, test rooms and administrative offices. Currently, about 44 nos have been installed.

A notable milestone during the year was the approval of the Company's Telescopic Mast Systems by an overseas defence customer following product evaluation further validating the quality. This strengthens the prospects of Company's products in International defence markets.

Electronic equipment manufacturing and design & development department has about 1,200 Sq Mt of floor space with nearly 50% more available for expansion.

The entire manufacturing space is dust-controlled with a forced-draft ventilation system and temperature- controlled areas.

The Company is leveraging its engineering and communications heritage to expand its position in defence manufacturing and tactical infrastructure.

(III) SEGMENT-WISE OUTLOOK

The Company operates under a single segment. However, the Company has structured its revenue streams as follows:

A. Manufacturing : This vertical consists of all the items that are manufactured in-house viz, Masts, Pedestals, Machined parts, electronic equipment, etc. This is the focus vertical of the Company and the revenue has seen an increase from about Rs.3,400 lakh in FY 2024-25 to Rs.5,594 lakh in FY 2025-26, a growth of about 65%. A similar growth is projected to be maintained in the current FY 2026-27 with a robust order in hand and expansion of production capacity.

B. ICT Solutions : The Company has positioned itself as a trusted ICT solutions provider in India, delivering advanced backbone and radio access network solutions for telecom, defence and critical infrastructure sectors. Its ICT vertical emphasizes reliability, innovation, and mission-critical performance. This is the growing vertical of the Company, and the revenue has seen an increase from about Rs.417 lakh in FY 202425 to Rs.2015 lakh in FY 2025-26, showcasing a robust growth in the revenue.

C. Service : This vertical consists of Engineering Services that are inclusive of SITIC (Supply, Install, Test, Integrate, and Commission) and Warranty & AMC support on behalf of foreign and local customers. This vertical targets large Domestic/ Foreign Original Equipment Manufacturers and Domestic/ Foreign Systems Integrators that require in-country support for highly sophisticated technologies and represents less than 10% of overall revenues.

(IV) OUTLOOK:

India's defence production is scaling up, driven by indigenisation, policy support and a shift towards selfreliance. Defence exports are witnessing strong growth, positioning India as a competitive player in global markets. Rising capital allocation in the Indian National budget is focussed on upgrading capabilities and capacities reflecting evolving defence priorities.

The Company enters FY 2026-27 with confidence supported by a robust order book, substantially enhanced manufacturing capacity and favourable industry dynamics. Increasing adoption of Anti-Drone Systems, expansion of defence communication infrastructure and growing export opportunities are expected to sustain demand for the Company's products.

The Company is benefiting from two long-term structural trends — India's defence indigenisation under the Make for India vision and the global increase in defence spending — rather than short-term business cycles. Management believes that the investments made in expansion of manufacturing capacity, together with its expanding customer base and specialised product portfolio is timely and positions the Company well for healthy growth in the coming years.

While inflationary pressures, raw material costs, working capital requirements, supply chain challenges and geopolitical uncertainties will continue to require close monitoring, the overall business outlook remains positive.

(V) SWOT ANALYSIS

The following SWOT analysis summarises the key internal strengths and weaknesses of the Company and the external opportunities and threats that may influence its business, operations and growth prospects, together with the Company's strategic response:

Management Response: The Company seeks to leverage its manufacturing and engineering capabilities, expanded production infrastructure, customer relationships and product portfolio to capitalise on identified opportunities. The Company is also focused on customer and programme diversification, strengthening its multi-program pipeline, monitoring programme milestones, improving receivable and inventory management, developing alternate sources for critical materials, investing in employee training and retention, strengthening quality and process controls, and maintaining appropriate cybersecurity, export-control and information-security measures.

(VII) INTERNAL FINANCIAL CONTROL & OTHERS

The Company has in place adequate Internal Financial Controls ("IFC") with reference to financial statements, and such internal financial controls are operating effectively. Your company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and competence of the accounting records, and timely preparation of reliable financial disclosures.

Based on this evaluation, no significant events had come to notice during the Financial Year ended on March 31, 2026, that have materially affected or are reasonably likely to materially affect our IFC. The management has also come to the conclusion that the IFC and other financial reporting were effective during the Financial Year ended on March 31, 2026, and are adequate considering the business operations of the Company.

(VIII) HUMAN RESOURCE DEVELOPMENT

Your Company believes that employees are the most valuable assets of an organization and the optimum utilization of the skill, knowledge, and attitude they possess is instrumental to the growth of the organization. Your Company has lived and encouraged meritocracy, entrepreneurship, teamwork, and a performance-driven culture. The focus has been on creating reserves through cross-functional and interdisciplinary exposure at all levels to ensure redundancy and robustness in the organization. The total number of employees of the Company as on 31st March 2026 stood at 162.

(IX) SIGNIFICANT KEY FINANCIAL RATIOS

Ratio Analysis (2025-26)

DEPOSITS

The Company has not invited or accepted any deposits during the year under review, falling within the ambit of section 73 of the Companies Act, 2013 ("the Act"), and the Companies (Acceptance of Deposit) Rules, 2014.

SHARE CAPITAL

The Company's Authorised share capital during the financial year ended March 31, 2026, remained at Rs.20,00,00,000/- (Rupees Twenty Crores only). The paid-up share capital of the Company is Rs.13,84,87,620/- (Rupees Thirteen Crore Eighty-Four Lakhs Eighty-Seven Thousand Six Hundred and Twenty Only) comprising of 1,38,48,512 fully paid-up equity shares of Rs.10/- each amounting to Rs.13,84,85,120/- and Rs.2,500/- on account of forfeited equity shares.

RELATED PARTY TRANSACTIONS

All transactions with related parties entered into during the year under review were at arm's length basis and in the ordinary course of business and were in accordance with the provisions of the Act and the rules made thereunder, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and the Company's Policy on Related Party Transactions.

The Audit Committee comprises solely of Independent Directors of the Company. During the year under review, the Company did not enter into any contracts, arrangements or transactions requiring the disclosure Form AOC-2 prescribed under the Act and, hence, does not form part of this Annual Report.

During the year under review, the materially significant Related Party Transactions undertaken pursuant to the provisions of the Listing Regulations were duly approved by the shareholders of the Company through postal ballot/general meetings held on July 14, 2025, September 22, 2025 and February 8, 2026.

The Company did not enter into any Related Party Transactions during the year under review that could be considered prejudicial to the interest of minority shareholders.

The Policy on Related Party Transactions is available on the Company's website at: https://pel-india.in/wp- content/uploads/2025/10/1.-8.-Policy-on-Materiality-of-Related-Party_F.pdf

Prior approval of the Audit Committee is obtained for all Related Party Transactions of a repetitive nature that are entered into in the ordinary course of business and at arm's length basis. A statement containing details of the Related Party Transactions entered into pursuant to each omnibus approval granted by the Audit Committee is placed before the Audit Committee on a quarterly basis for its review.

Pursuant to Regulation 23(9) of the Listing Regulations, disclosures of Related Party Transactions are submitted to the Stock Exchanges on a half-yearly basis and are also published on the Company's website at: https://pel- india.in/useful-investor-data/.

The details of transactions with related parties of the Company for the financial year under review are disclosed in the Notes to the Financial Statements, which form part of this Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY COMPANY

During the year under review, there was no transaction of loan, guarantee or investment by the Company within the ambit of Section 186 of the Act.

SUBSIDIARIES/ JOINT VENTURES/ ASSOCIATE COMPANIES

The Company does not have any subsidiary/ joint venture/ associate company. Further, no Company has become or ceased to be a subsidiary/joint venture/associate company of the Company during the year under review. Hence, Form AOC-1 containing salient features of the subsidiary/joint venture/associate Company is not required.

DISCLOSURE OF AGREEMENTS ENTERED BETWEEN THE COMPANY AND ITS SHAREHOLDERS/ PROMOTERS/DIRECTORS/KMP

As per Regulation 30A read with clause 5A to para-A of part A of Schedule III of Listing Regulations, the Company has not entered into any agreement with its Shareholders, Directors, or KMPs, etc. during the financial year which would impact the management or control of the listed entity.

DETAILS OF DEVELOPMENTS, ACQUISITIONS, AND ASSIGNMENTS OF MATERIAL INTELLECTUAL PROPERTY RIGHTS

During the period under review, the company has not made any developments, acquisitions, or assignments in respect of any material intellectual property rights.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Your Company recognizes the benefits of having a diverse Board, and increasing diversity at the Board level is viewed as an essential element in maintaining a competitive advantage. Your Company believes that a diverse Board will

leverage differences in thought, perspective, knowledge, skill, industry experience, cultural and geographical backgrounds, which will ensure that the Company retains its competitive advantage.

Your Company believes that a diverse Board contributes towards driving business results, making corporate governance more effective, enhancing quality and responsible decision-making capability, ensuring sustainable development, and enhancing the reputation of the Company.

Board of Directors:

1. On the recommendations of the Nomination and Remuneration Committee ("NRC"), the Board, subject to the approval of the shareholders, has approved the re-appointment of Ms. Preeti Grover (DIN: 00128513) as an Independent Director for her second consecutive term of 5 years, w.e.f. September 24, 2025. Subsequently, the shareholders of the Company at the 46th Annual General Meeting held on September 22, 2025, approved her second consecutive term as an Independent Director of the Company w.e.f. September 24, 2025, for a term of 5 years.

2. Mr. Harbir Singh Banga (DIN: 05313332) resigned from the position of Non-Executive Non-Independent Director of the Company w.e.f close of business hours of November 11, 2025. The Board in its meeting held on November 11, 2025, places on record its deep appreciation for the contributions and guidance provided by him during his tenure with the Company.

3. On the recommendations of NRC, the Board, subject to the approval of the shareholders, has approved the appointment of Mr. Amitbir Singh Banga (DIN: 07163599) as an Additional Director (Non-Executive and NonIndependent), liable to retire by rotation, w.e.f. November 11, 2025. His appointment as Director was approved by the shareholders vide an Ordinary Resolution passed through Postal Ballot on February 8, 2026.

4. On the recommendations of the NRC, the Board, the shareholders of the Company has approved the confirmation of appointment of Mr. Dinesh Batra (DIN: 08773363) as an Independent Director of the Company by way of a Special Resolution in accordance with Regulation 25(2A) of the Listing Regulations.

Retirement by Rotation:

In accordance with the provisions of section 152 of the Act, Mr. Ashok Kumar Kanodia (DIN: 00002563), is retiring by rotation at the ensuing AGM of the Company and is eligible for re-appointment.

The Board, on the recommendation of NRC of the Company, recommends the re-appointment of Mr. Ashok Kumar Kanodia as a Director for your approval. Brief details, as required under Secretarial Standard-2 and Regulation 36 of the Listing Regulations, are provided in the Notice of the ensuing AGM.

Key Managerial Personnel ('KMP'):

In compliance with the provisions of sections 2(51) and 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended from time to time), the following persons are acting as the Key Managerial Personnel (KMP) of the Company as on March 31, 2026:

1. Mr. Ashok Kumar Kanodia, Executive Chairman;

2. Mr. Nikhil Kanodia, Managing Director;

3. Mr. Manmohan Singh, Chief Financial Officer;

4. Mr. Punit Amarpalsingh Bajaj, Company Secretary and Compliance Officer.

Pursuant to Rule 8(5)(iii) of the Companies (Accounts) Rules, 2014, the following changes occurred among the Key Managerial Personnel of the Company during the year under review:

i. Ms. Veenita Khurana, Company Secretary cum Compliance Officer, has resigned w.e.f. June 30, 2025 and ceased to be the Key Managerial Personnel of the Company.

ii. On the Recommendation of NRC, the Board has appointed Mr. Manmohan Singh as Chief Financial Officer of the Company w.e.f. May 30, 2025.

iii. On the recommendations of NRC, the Board appointed Mr. Punit Amarpalsingh Bajaj, as Company Secretary and Compliance Officer of the Company w.e.f. August 6, 2025.

The Board places on record its appreciation towards valuable contribution made by them during their tenure with the Company.

BOARD EVALUATION

Pursuant to and in compliance with the provisions of the Act read with Rules framed thereunder and as provided in Schedule IV of the Act and Regulation 17(10) of the Listing Regulations, the NRC and the Board have carried out an annual evaluation of its own performance, the directors individually as well as its committees. Pursuant to and in compliance with the provisions of section 134(3)(p) of the Act read with rule 8(4) of the Account Rules, the manner in which the evaluation was carried out is provided in the Corporate Governance Report, which forms a part of this Annual Report.

In a separate meeting of Independent Directors, the performance of the non-independent directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of executive directors and nonexecutive directors.

The NRC and the Board evaluated the performance of the (i) committees constituted by the Board and (ii) individual directors taking into consideration various aspects (iii) Board as whole.

The functioning of the Board, the committees constituted by the Board and performance of individual directors was found satisfactory

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declarations from each of the Independent Directors that they, respectively, meet the criteria of independence prescribed under section 149 read with schedule IV of the Act and rules made thereunder, as well as Regulations 16 and 25(8) of the Listing Regulations. Based on the declarations received, the Board considered the independence of each of the Independent Directors in terms of above provisions and is of the view that they fulfill the criteria of independence and are independent from the management.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied of the integrity, expertise and experience (including proficiency, in terms of section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board to discharge their duties. In terms of section 150 of the Act read with rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, all Independent Directors have enrolled themselves on the Independent Directors databank maintained with the Indian Institute of Corporate Affairs.

MEETINGS OF THE BOARD AND COMMITTEES

The Board of Directors met 5 (five) times during the period under review. The details of the number of meetings of the Board and various committees of the Board of the Company are set out in the Corporate Governance Report, which forms part of this report.

SECRETARIAL STANDARDS:

The Directors state that the applicable secretarial standards, i.e. SS-1 and SS-2, relating to meetings of the Board of Directors and General Meetings have been duly followed by the Company.

REMUNERATION POLICY

In accordance with the provisions of section 178 of the Act and part D of schedule II of the Listing Regulations, the policy on nomination and remuneration of Directors, KMPs, and senior management of your Company is uploaded on the website of the Company and may be accessed at www.pel-india.in. During the year under review, there has been no change to the policy.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

In terms of the provisions of Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules and the disclosures relating to remuneration and other details, is annexed as Annexure A to this Report.

STATUTORY AUDITORS

In terms of Section 139 of the Act, read with rules made thereunder, M/s Nemani Garg Agarwal & Co., Chartered Accountants, were appointed as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of the 43rd AGM till the conclusion of the 48 th AGM in the calendar year 2027.

The statutory auditors have confirmed that they are not disqualified from continuing as the auditors of the Company.

The statutory auditors have issued an unmodified opinion on the Company's financial statements for the financial year ended March 31, 2026, and the auditor's report for the year under review does not contain any qualification, reservation, adverse remark, or disclaimer.

The Board has duly reviewed the statutory auditors' report, and the observations and comments appearing in the report are self-explanatory and do not call for any further explanation/clarification by the Board as provided under section 134(3)(f) of the Act.

There are no instances of any fraud reported by the Statutory Auditors to the Audit Committee or the Board pursuant to section 143(12) of the Act.

SECRETARIAL AUDITORS

M/s. Yogesh Saluja & Associates, Company Secretaries, were appointed to conduct the Secretarial Audit for a period of 5 financial year commencing from financial year 2025-26. The Secretarial Audit Report for the financial year ended March 31, 2026, is annexed herewith as Annexure B, and the Board's comments/explanation in respect of the observations / reservations / adverse remark is annexed herewith as Annexure C to this Report.

ANNUAL SECRETARIAL COMPLIANCE REPORT

A Secretarial Compliance Report for the Financial Year ended March 31, 2026, on compliance with all applicable Acts and the Listing Regulations and circulars/ guidelines issued thereunder, was obtained from M/s. Yogesh Saluja & Associates, Company Secretaries, Secretarial Auditor of the Company and submitted to the Stock Exchange within stipulated timelines.

MAINTENANCE OF COST RECORDS:

In terms of Section 148 of the Act read with Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Company is not required to maintain the cost records.

RISK MANAGEMENT

The Company has in place a robust risk management framework that identifies and evaluates business risks and opportunities. The Company recognizes that the applicable risks need to be managed and mitigated to protect the interests of the shareholders and stakeholders, to achieve business objectives, and enable sustainable growth. The risk management framework is aimed at effectively mitigating the company's various business and operational risks through strategic and tactical actions. The factors that affect the Company's profitability and operations are regularly monitored.

CORPORATE SOCIAL RESPONSIBILITY(CSR)

During the year under review, the provisions of Section 135 of the Act, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, are not applicable to the Company

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

No significant material order(s) have been passed by the regulators/ courts which would impact the going concern status of the Company and its future operations during the period under review.

DIRECTOR'S RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, your Directors state that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2026, the applicable Accounting

Standards and Schedule III of the Act have been followed, and there are no material departures from the same;

b) 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 and of the Profit and Loss of the Company for the year under review;

c) the Directors have taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts on a 'going concern' basis;

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

f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

The particulars relating to conservation of energy, technology absorption, and foreign exchange earnings and outgo as required to be disclosed under Section 134(3)(m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as Annexure D to this Report.

ANNUAL RETURN

In accordance with the provisions of Section 92 and 134(3)(a) of the Act, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return in e-form MGT-7, for the financial year ended March 31, 2026, in the prescribed Form No. MGT-7 is available on the website of the Company at www.pel-india.in. The Annual Return will be filed with the Registrar of Companies within the prescribed time frame.

CORPORATE GOVERNANCE

Your Company is committed to achieving the highest standards of corporate governance and adhering to the corporate governance requirements set out by the Securities and Exchange Board of India.

The report on corporate governance as stipulated under the Listing Regulations for the financial year 2025-26, and a certificate issued by M/s. Yogesh Saluja & Associates, Company Secretaries is annexed herewith as Annexure-E to this report.

VIGIL MECHANISM

A vigil mechanism of the Company, which includes whistle blower policy pursuant to section 177(9) & (10) of the Act, has been established and can be accessed at the Company's website www.pel-india.in.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

In adherence to the Sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, and the rules made thereunder, your Company has constituted an Internal Complaints Committee to redress complaints regarding sexual harassment.

The details pertaining to complaints received on matters pertaining to sexual harassment during the Financial Year 2025-26 are as below:

(a) number of complaints of sexual harassment received in the year: Nil

(b) number of complaints disposed of during the year: Nil

(c) number of complaints pending for more than ninety days: NA ENVIRONMENTAL PROTECTION, HEALTH AND SAFETY

The Safety & Health of employees and external stakeholders are embedded in the core organizational values of the Company. This aims to ensure the safety of the public, employees, plant & equipment, ensure compliance with all statutory rules and regulations, imparting training to its employees, carrying out safety audits of its facilities, and promoting eco-friendly activities.

The Company continues to maintain an excellent track record on safety. The site had no accidents during the year 202526. PEL also has a Workman Safety Committee under section 41G of the Factories Act 1948. This Committee meets at regular intervals to take measures for workers' protection in order to make PEL a safe place to work.

DISCLOSURE UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

There was no application made by the Company initiating insolvency proceedings against any other entity nor are any proceedings pending against the Company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

DIFFERENCE IN VALUATION IN THE CASE OF ONE TIME SETTLEMENT OF LOAN FROM BANK OR FINANCIAL INSTITUTION

There was no one-time settlement of loans from banks or financial institutions by the Company during the period under review. Accordingly, there are no details regarding the difference between the amount of the valuation done at the time of one-time settlement and the valuation done while taking a loan from the Banks or financial institutions.

COMPLIANCE OF THE MATERNITY BENEFIT ACT, 1961

The Company has complied with provisions relating to the Maternity Benefit Act, 1961 GENERAL DISCLOSURES

During the Financial Year ended on March 31, 2026, the Company has not-

a. issued any shares, warrants, debentures, bonds, or any other convertible or non-convertible securities,

b. issued any shares with differential voting rights,

c. issued any sweat equity shares, and

d. made any changes in voting rights.

CAUTIONARY STATEMENT

Statements in the Board's report and the Management Discussion and Analysis describing the Company's objectives, expectations, or forecasts, may be forward-looking within the meaning of applicable Securities Laws and Regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include global and domestic demand and supply conditions, input availability and prices, changes in government regulations, tax laws, economic developments within the country, and other related factors.

ACKNOWLEDGMENTS:

Your Directors wish to place on record their appreciation for the sincere services rendered by the Company's staff and workers at all levels. Also, they wish to place on record their appreciation and gratitude for the valuable support received from Bankers, their Customers, Business Associates, Government Departments, and Shareholders, and look forward to similar support and co-operation in the future. The Directors also commend the continuing commitment and dedication of the employees at all levels, which has been critical for the Company's success. The Directors look forward to their continued support in the future. .

FOR AND ON BEHALF OF THE BOARD