Your Board hereby presents the 65th Annual Report and the Audited Accounts for the year ended 31st March, 2026.

The Company's financial performance under review is summarized below:

The Company recorded a turnover of Rs.8,352.64 lakhs in the year FY 2025-26, as compared to Rs.8,099.82 lakhs, during the previous Financial Year 2024-25.

The total number of shareholders as on 31st March, 2026 was 22,530 holding 89,63,840 shares (Face value of Rs.2/- each) of which 88,83,040 shares are held in Demat form by 22,455 shareholders.

This represents 99.10% of the total Equity Share Capital compared to 98.87% in the previous year.

Your directors have recommended a dividend of 150% (Rs. 3/- (Rupees Three only) per equity share of Rs.2/- each for the financial year ended 31st March, 2026, absorbing a sum of Rs.268.92 lakhs, subject to the approval of shareholders at the ensuing 65thAnnual General Meeting.

The requirement to do transfer from Current Year Profits to Reserves has been dispensed by the Ministry of Corporate Affairs ("MCA"). No amount was transferred to any reserve during the financial year.

The Company achieved a turnover of Rs.7,660.28 lakhs through Silver Zinc Battery supplies during the FY 2025-26 as against Rs.7,772.27 lakhs, during the FY 2024-25.

During the year, the turnover of Nickel Cadmium Division was Rs.649.96 lakhs, as against Rs.302.95 lakhs during the previous year. The modernization goal of Railways for development cum supply of both sintered plate type and pocket plate type Nickel Cadmium (NICAD) batteries, is under progress. Discussions are in progress with reputed companies abroad, to establish local manufacturing base, during FY 2026 - 27.

As reported earlier, the operations of our Lead Acid Battery division remain suspended since April, 2019 due to severe competition in the retail market resulting in non-remunerative prices. While our efforts are continuing towards the revival of the Plant, favorable options could not be arrived at, that will ensure sustained operations.

During the year, the export turnover was Rs.24.30 lakhs, when compared to Rs.1,222.08 lakhs made during FY 2024 - 25.

During the year, the Merchant Export turnover was Rs.1,089.50 lakhs and it was Nil in the previous year.

The financial position of the Company was comfortable during the year, owing to our improved operations, coupled with judicial utilization of working capital limits and also reduction in interest rate(s) by the Banks. Though the Company is categorized as MSME, (presently in "Small" category since April 2025), due to the internal procedures of the Defence/Government departments, payments were getting delayed at times. On such occasions, the needed financial support was duly cognized and support taken from Bankers, to ensure continued operations of our plant.

Our Quality Management Systems "(QMS) ISO 9001:2015", "Environmental Management Systems" (EMS) ISO 14001:2015 and OHSMS 45001: 2018 "Occupational Health and Safety Management Systems (OHSMS), continue to be accredited for "Aerospace, Naval Battery" and "Lead Acid Battery" Divisions.

During FY 2025 - 26, our Research & Development (R&D) received Development cum supply of a battery involving Silver Zinc system for Heavy Weight Torpedoes. The development activity progressed satisfactorily within the stipulated period.

Apart from this, the design of Silver Zinc cells with improved Cycle life and Wet life was developed and the testing is under progress.

On similar lines, development of Sea Water activated battery catering to Light Weight Torpedo requirements requiring higher power of 120 kW was completed. Further modifications and improvements were carried out and the Sea Trial was completed successfully. Supply orders from DRDO and Indian Navy is enabling regular production, and is expected to commence during the FY 2026-27.

The Company received development cum supply order of Nickel Cadmium (Ni-Cd) batteries for Indian Railways loco application. Towards this, the battery manufacturing, assembly cum testing facility was established and regular production shall commence upon receiving the approval from the customer during FY 2026-27.

The Company initiated the activity of indigenizing Towed Reel and Torpedo Reel for Underwater applications. In this, the company achieved the indigenization of Mechanical hardware. The reel wire development is in progress and upon completion of this activity and approval by Navy, regular supply can be pursued from FY 2026 - 27.

The purpose of this battery type is to provide power for underwater monitoring instruments for over a year or longer, continuously. Activities pertaining to the design, development cum evaluation of long endurance Sea Water battery was initiated through TDF (Technology Development Fund) DRDO. The field trials and testing of the battery were completed satisfactorily during FY 2025 -26 (one at HEB premises and one battery in co-ordination with National Institute of Ocean Technology (NIOT) at sea, off the coast of Chennai).

The Company developed Sea Water activated battery for underwater expendable acoustic devices during FY 2025 - 26 and the performance on testing, met the requirements satisfactorily. Regular production and supply is slated for FY 2026 - 27 onwards.

The Company received development cum supply of High-Power Silver Zinc Batteries for Combat underwater applications. Battery designed and developed by our company was qualified by DRDO and the performance was satisfactory. Possibility is there for regular supplies, once the System/Platform is inducted into service in the upcoming six to nine months, through Indian Navy.

CHT had initiated another program during FY 2023 - 24, with IOCL and GAIL as funding agencies and with our participation. The target of this two-year program is to come up with a low power Fuel Cell (FC) stack using Hydrogen and Air as an open Cathode design PEMFC system.

On this, optimization of membranes, the catalysts material selection, catalyst loading and proto type stack evaluation progressed satisfactorily. The Process flow and control parameters for proto development was established and this program was completed including the testing cum evaluation of a scaled up 2.5 kW plus level unit, during the FY 2025 - 26 at Company premises. The on-road demonstration at IOCL (R&D Centre) is in progress.

Based on the satisfactory demonstration cum completion of the development program with OECT on 1 kW/10 kWh module carried out in co-ordination with IIT Chennai, OECT preferred to initiate the next level of funded program with our participation.

Main scope of the program involves scaling up of the system to 10 kW/50 kWh rating and further evaluation, on stand-alone storage mode using Solar PV based energy harness. Activities pertaining to this contract had started from March 2024 and the proposed work progressed well and was completed during the period FY 2025 - 26.

Further, agreement is under process with funding agency for further continuity of activities including on-site testing & validation, towards commercial exploitation.

Company is presently exploring other opportunities by participating in Tenders/proposals on VRFB segment and energy storage back-up needs of Solar PV projects.

The facility for cell screening, making battery pack assembly, BMS (Battery Management System), Controller and Electronics and testing as both LIB packs or Lithium Ion battery using cylindrical as well as prismatic type cells, is now fully established.

We have made a number of standalone Solar PV based street lights which are regularly monitored and evaluated at different locations at Mathur village and at Large Industrial sites. Work on EV battery is also under in-house evaluation along with in-house development of Lithium-Ion batteries along with Inverter, BMS and Electronics for backup services as an integrated Battery Energy Storage System [BESS]. Field evaluation cum inhouse testing is under progress in tandem with Solar PV based Energy source.

Recently (FY 2025 - 26), our Company participated in a tender for Balance of Plant (BOP) for 60kW PEM (Proton Exchange Membrane) Electrolyzer and the technical evaluation is under progress. Our plan is to work on Hydrogen Electrolyzers, both alkaline based and PEM based.

A detailed discussion on the industry structure as well as on the financial and operational performance is contained in the ‘Management Discussion and Analysis Report' that forms an integral part of this Report as Annexure - 1.

Pursuant to Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Corporate Governance Report together with the certificate from the Company's auditors confirming the compliance of conditions on Corporate Governance is given in Annexure-2. The Corporate Governance Report also includes contents and disclosures required under Section 134(3) of the Companies Act, 201 3 at relevant places that forms an integral part of this report.

Pursuant to provisions of Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, a copy of annual return for FY 2025 - 26 will be placed on the website of the company after conclusion of the 65th AGM. However, a copy of Annual Return for FY 2024-25 has been placed on the website of the Company https://www. highenergy.co.in/ .

Pursuant to Section 134(3)(c) of the Companies Act, 2013 with respect to the Directors' Responsibility Statement, your Board confirms that:

(a) in the preparation of the annual accounts, the applicable Accounting Standards have been followed and there are no material departures from the same;

(b) the Directors had 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 of the Company for that period;

(c) 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;

(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 were operating effectively; and

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

During the year, the Company did not give any loan or guarantee or made any investment or provide any Security, which are covered under Section 186 of the Companies Act, 2013.

In line with the requirements of the Act and the SEBI (LODR) Regulations, 2015, the Company has formulated a Policy on Related Party Transactions. All Related Party Transactions (RPTs) entered into by the Company have the prior approval of the Audit Committee. The Related party transactions that were entered into by the Company during the FY 2025-26, were on Arm's length basis. Further, no material related party transactions were entered into by the Company during the FY 2025 -26.

The Corporate Governance Report contains relevant details on the nature of Related Party Transactions (RPTs) and the policy formulated by the Board on Material RPTs.

Particulars of contracts or arrangements with related parties referred in Section 188(1) of the Companies Act, 2013 is furnished in accordance with Rule 8(2) of the Companies (Accounts) Rules, 2014 in disclosed in Form No.AOC-2 is given in Annexure - 3.

The details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the notes to the financial statements of the Company.

There is no change in the nature of business of the Company during the year. There is no material change or commitment affecting the business operations and the financial position of the Company that has occured since 31st March 2026, to the date of this Report.

Information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo, as required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 is given in Annexure - 4 that forms part of this report.

The company is covered under the mandate of Section 135 of the Companies Act, 2013 for FY 2025 - 26. The CSR Report, in the prescribed form is given in Annexure - 5, that forms part of this report.

The Statement of Disclosure of Remuneration under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is given in Annexure - 6 that forms part of this report.

The Company comes under MSME classification, since 01st July 2020 as "Small" Enterprises (UDYAM- TN-02-0000445). The said category was changed as "Medium" Enterprises from Small from 16th May, 2021. The Company complies with all the requirements of MSME and further, avails/utilizes the benefits, arising out of this reclassification including GOI/MOD contracts and Bank operations.

MSME vide notification number S.O. 1364(E) dated 21st March, 2025 defined the revised threshold for investment and turnover which is effective from 01st April, 2025. As per the said notification, the Company was categorized as "Small" under MSME Classification with effect from 01st April, 2025. For the FY 2025 - 26 our company continues to remain as "Small" category.

As on 31st March, 2026, the Company has no Subsidiary, Joint venture and Associate Companies.

The Company does not accept public deposits and there is no outstanding at the beginning or end of the year.

No significant or material order has been passed by the regulators or courts or tribunals impacting the ongoing concern status of the Company and the operations of the Company in future.

(i) The Company has laid down adequate systems and well-drawn procedures for ensuring internal financial controls. It has appointed an external audit firm as Internal Auditors for periodical checking and reviewing the adequacy of systems.

(ii) Internal auditors are present at the Audit Committee meetings where internal audit reports are discussed alongside of management comments and the final observation of the internal auditor.

(iii) The Board of Directors have adopted various policies like Related Party Transactions Policy and Whistle Blower Policy and put in place budgetary control and monitoring measures for ensuring proper and efficient conduct of the business of the Company, safeguarding of its assets, the prevention and detection of frauds and errors, accuracy of reporting, completeness of the accounting records and the timely preparation cum presentation of reliable financial information.

(iv) Audit Trail requirements as per New Standards, are available in ERP system of the Company.

Though Cost Audit is not applicable to the Company. The Cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, are prepared and maintained by the Company.

The Company has a Policy for Prevention of Sexual Harassment (POSH) of

Women at Workplace and also complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company had constituted an Internal Committee (IC) with 4 Members (including 1 External member) and conducts Awareness programmes every year for all the Women employees of the Company.

Number of complaints received and resolved in relation to Sexual Harassment of Women at Workplace (Prevention, Protection, and Redressal) Act, 2013: during the year under review and their details is as under:

a) No. of complaints of sexual harassment received in the year:

b) No. of complaints disposed off during the year: NIL

c) No. of cases pending at the end of year (as on 31.03.2026) : NIL

d) No. of cases pending for more than 90 days: NIL

Application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016: NIL

The Company has not made OTS with Banks or Financial institutions.

The Company is committed to providing a safe, inclusive and supportive work environment for all employees, including women employees. The Company complies with the provisions of the Maternity Benefit Act, 1961 and the rules framed thereunder, as amended from time to time. However, the requirement of providing benefit to woman under Maternity Benefit Act, 1961 has not arisen during the year.

The Financial Statements of the current year are prepared as per IndAS, which was adopted since Financial Year 2017-18.

As required under Regulation 53 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Cash Flow Statement is attached to the Balance Sheet.

Relations between the Management and Employees were cordial throughout the year under review. The Management ensured that all necessary steps were taken to follow the guidelines/norms of safety and health mandated by the Government.

During FY 2025-26, the company concluded the wage negotiation and the same is valid for a tenure of five (5) years effective from 01st April, 2024 to 31st March, 2029.

(a) At the 64th Annual General Meeting of the Company, shareholders through Special Resolution reappointed Mr. N Gopalaratnam (DIN:00001945) as a Director of the Company, liable to retire by rotation.

(b) On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at the meeting held on 31.01.2026, re-appointed Dr. G A Pathanjali (DIN:05297665) as Managing Director of the Company for a period of three years with effect from 01st April, 2026 to 31st March, 2029.

(c) LIC vide its letter dated (IBO/ ND Cell/SS) dated 13.01.2026 nominated Mr. C V Ramana as Nominee Director of the Company, in place of Mr. N P Sinha. The Board of Directors at the meeting held on 31.01.2026, appointed Mr. C.V. Ramana (DIN: 11517220) as Nominee Director of the Company with effect from 31st January, 2026, in place of Mr N P Sinha (DIN:07980838).

(d) The Board based on the recommendation of the Nomination and Remuneration Committee passed resolution through Circulation on 20.02.2026 relating to recommending the appointment of Mrs Jayashree Ajit Shankar (DIN:08397093) as Woman Independent Director of the Company for a first term of five years from 01st April, 2026 and approved the Postal Ballot notice to seek shareholders approval for the Reappointment of Managing Director by Special Resolution, Appointment of Nominee Director by an Ordinary Resolution and for the Appointment of Woman Independent Director by a Special Resolution.

(e) In the opinion of the Nomination and Remuneration Committee and the Board of Directors, Mrs Jayashree Ajit Shankar (DIN:08397093) carries an experience over three decades in the varied areas especially Insurance, Personnel Management and Corporate Strategies and she possesses the relevant qualification, skill, experience and technical knowledge. Further, Mrs Jayashree Ajit Shankar has registered with the Databank maintained by the Indian Institute of Corporate Affairs (IICA) and she is exempted from undertaking the online proficiency self - assessment test conducted by the Indian Institute of Corporate Affairs.

(f) Pursuant to Section 149, 152 and other applicable provisions of the Companies Act, 201 3 and Regulation 17 (1C) of the SEBI (LODR) Regulations, 2015, following Special and Ordinary Resolutions were passed through Postal Ballot by the Shareholders on 24th March, 2026:

• For the Re-appointment of Dr. G A Pathanjali (DIN:05297665) as Managing Director of the Company for a period of three (03) years with effect from 01st April, 2026 to 31st March, 2029, not liable to retire by rotation

• For the Appointment of Mrs. Jayashree Ajit Shankar (DIN: 08397093) as Woman Independent Director for a first term of five years from 01st April, 2026 to 31st March, 2031, not liable to retire by rotation.

• For the Appointment of Mr. C V Ramana (DIN: 11517220) Nominee Director (Nominee of LIC) of the Company with effect from 31st January, 2026, not liable to retire by rotation.

The above Special and Ordinary Resolutions as stated in the Postal ballot notice dated 20.02.2026 has been passed with requisite majority. The Voting results of the Postal ballot process was declared on 24th March, 2026 and posted in our Company's website.

(g) Pursuant to Section 149 of the Companies Act 2013, the Directorship of Mrs Lalitha Lakshmanan (DIN:07140032) as Independent Director of the Company was completed by 31st March, 2026, upon completion of her two terms of five consecutive years each.

(h) Pursuant to Section 152 (6) of the Companies Act, 2013 and in accordance with Article 89 of the Articles of Association of the Company, Mr. M Ignatius (DIN: 08463140), Director (Operations) of the Company, retires by rotation at the ensuing 65th AGM of the Company and being eligible offers himself for re-appointment, through Ordinary Resolution. Due disclosure and rationale for his reappointment are furnished in the statement pursuant to Section 102(1) of the Companies Act, 2013 attached to the AGM Notice.

Necessary resolution is placed before the Shareholders for their approval.

The Company obtained the approval of Shareholders at the 61st AGM held on 29th June, 2022 for the appointment of M/s. Maharaj N R Suresh And Co LLP, Chartered Accountants as Statutory Auditors of the Company for a Second term of Five years. Accordingly, their term will expire at the conclusion of the 66th Annual General Meeting of the Company.

On the basis of recommendation of Audit Committee, the Board at its meeting held on 21st January, 2025 appointed M/s. R Subramanian And Company LLP, Chartered Accountants as Internal Auditor of the Company for a period of two (2) years, from FY 2025-26 & FY 2026-27.

Pursuant to Regulation 24A of SEBI (LODR) Third Amendment Regulations, 2024 dated 12th December, 2024, relating to the appointment of Secretarial Auditor, the Board at its meeting held on 10th May, 2025 recommended the appointment of M/s. V Suresh Associates, Practicing Company Secretaries as Secretarial Auditor of the Company for a term of Five (05) consecutive financial years, from FY 2025-26 to FY 2029-30 and the same was approved by the shareholders in the 64th Annual General meeting held on 21st June, 2025.

The appointment of Cost Auditors is not mandatory for the Company during the FY 2026-27.

Particulars of Statutory Auditor, Internal Auditor and the Secretarial Auditor are given in the "Corporate Governance" Report that forms an integral part of this Report.

Secretarial Audit Report, as required by Section 204(1) of the Companies Act, 2013, is attached as Annexure - 7.

Your Directors wish to express their sincere thanks to:

(i) all the valued customers viz., Defence Services, VSSC, ISRO, RCI, ASL, DRDO Laboratories and Ministry of Defence (MOD), NSTL, NPOL, NMRL, BDL, BrahMos (BAPL), BEL, HAL, ADE, ADA, Mahindra Defense, TDF, NIOT and other Defence based organizations such as DGONA, DAPI, CVRDE, MGO, Air (HQ), HQMC for the whole-hearted support and encouragement, towards indigenous sourcing of Batteries for strategic applications, fulfilling Atma Nirbhar.

(ii) all our valued Govt Statutory Bodies like IOF, PCB and Inspection cum Certifying agencies such as CEMILAC, DGAQA, DGNAI, DGQA, MSQAA, SSQAG, R&QA, CLW (Chittaranjan Loco Works) and Railways for their timely and meticulous adherence of Quality Assurance/Product acceptance procedures.

(iii) Educational Institutions viz., NIT(T), IIT Chennai for their co-operation and technical support to our R & D progress, OECT, part of ONGC for initiating a program on Vanadium Redox Flow Battery (VRFB); Centre for High Technology (CHT) in partnership with OECT, IOCL and GAIL for initiating development activities pertaining to Fuel Cells and Electrolyzer based Green Energy using Hydrogen; Research Institutions like CECRI, National Institute of Technology (NIT), Trichy for actively involving in our Indigenization efforts.

(iv) the Overseas customers, WASS (Italy), Thyssenkrupp (Germany), DASTAN (Kyrgyzstan), SLAF (Sri Lanka) and VIRTUS (Merchant Exporter), who have reposed utmost faith and confidence in our products and co-operating with us, including as offset partners.

(v) the Consortium of Bankers viz., UCO Bank (UCO) and Punjab National Bank (PNB) for extending timely financial support towards the continued positive performance of the Company.

(vi) the Employees at all levels of the company for their co-operation, harmonious working to achieve committed deliveries and the sincere efforts put in to sustain the performance.

(vii) to all suppliers, vendors, service providers, sub-contractors and Shareholders for their continued trust and support.