To

The Members,

The Directors are pleased to present the Thirty Ninth (39^th) Annual Report of the Company together with the Audited Financial Statements (Standalone and Consolidated) for the financial year ended 31^st March, 2025.

In compliance with the applicable provisions of the Companies Act, 2013, (including any statutory modification(s) or amendment(s) thereof, for time being in force) ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this report covers the financial results and other developments during the financial year ended 31^st March, 2025, in respect of Craftsman Automation Limited ("the Company").

During the Financial Year (FY) 2024-25, the Company has achieved operating income of Rs.384795 Crores as compared to Rs.320779 Crores in FY 2023-24. The profit before tax for FY 2024-25 stood at Rs.127 55 Crores compared to Rs.265.50 Crores achieved in FY 2023-24. The profit after tax stood at Rs.93.69 Crores for FY 202425 as compared to Rs.19759 Crores in FY 2023-24.

The Company's consolidated revenue for FY 2024-25 was Rs.5690.48 Crores as compared to Rs.4451.73 Crores in FY 2023-24. During the year under review, the consolidated profit after tax stood at Rs.200.87 Crores as compared to Rs.33733 Crores in FY 2023-24.

The Consolidated Financial Statement includes Audited Financial Statements of Craftsman Europe B.V., Wholly

Owned Subsidiary ("WOS"), DR Axion India Private Limited (WOS), Sunbeam Lightweighting Solutions Private Limited (WOS) and Craftsman Germany GmbH (WOS), along with its subsidiaries i.e. Craftsman Fronberg Guss GmbH and Craftsman Fronberg Guss Immobelien GmbH (Step-down subsidiaries).

The Board of Directors of the Company at their meeting held on 4^th May, 2024 had approved the execution of a Share Purchase Agreement ("SPA") by and amongst, the Company, DR Axion India Private Limited ("DR Axion"), Daerim International Co Ltd ("Daerim") and DR Axion Co. Ltd, to acquire the remaining 24% of Equity Share Capital i.e., 2,70,83,884 Equity Shares of Rs.10/- each of DR Axion a Material Subsidiary of the Company.

Subsequently, the Company completed the acquisition of the remaining 24% of the Equity stake in DR Axion on 29^th June, 2024 for a consideration amount of Rs.250,00,00,000 (Rupees Two Hundred and Fifty Crores Only). Consequently, DR Axion became a Wholly Owned Subsidiary of the Company w.e.f. 1^st July, 2024.

The Board of Directors of the Company at their meeting held on 5^th August, 2024, had approved the execution of a Securities Subscription and Purchase Agreement ("SSPA") with Sunbeam Lightweighting Solutions Private Limited ("Sunbeam") and Kedaara Capital Fund II LLP ("Kedaara") for acquiring 100% of the legal and beneficial interest of the total securities of Sunbeam and subscription to 3760,00,000 (Thirty Seven Crore Sixty Lakhs) Optionally Convertible Debentures ("OCDs"), each having a face value of Rs.10.

As a preliminary step towards closing the acquisition, On 7^th October, 2024, the Company had subscribed to 13,60,00,000 (Thirteen Crore Sixty Lakhs) OCDs of Sunbeam for a consideration of Rs.136,00,00,000/- (Rupees One Hundred and Thirty-Six Crores Only) in accordance with the terms of the SSPA.

The Company acquired 100% of the legal and beneficial interest of the total securities of Sunbeam for a consideration amount of Rs.1 (Rupees One). Consequently, Sunbeam became a Wholly Owned Subsidiary of Craftsman Automation Limited w.e.f. 9^th October, 2024.

Further, on 10^th October, 2024, the Company had subscribed to 24,00,00,000 (Twenty-Four Crore) OCDs of Sunbeam for a consideration of Rs.240,00,00,000/-

(Rupees Two Hundred and Forty Crores Only) in accordance with the terms of the SSPA and on 28^th October, 2024, the Company had subscribed to 23,00,00,000 (Twenty-Three Crores) OCDs of Sunbeam for a consideration of Rs.230,00,00,000/- (Rupees Two Hundred and Thirty Crores only).

The Company had acquired 100% of the share capital of Craftsman Germany GmbH, Germany, along with its subsidiary, Craftsman Fronberg Guss GmbH, Germany, on 22^nd July, 2024. Consequently, Craftsman Germany GmbH became a Wholly Owned Subsidiary and Craftsman Fronberg Guss GmbH became a Stepdown Subsidiary of the Company with effect from 22^nd July, 2024.

Further, on 1^st October, 2024, Craftsman Fronberg Guss GmbH had acquired the assets of Fronberg Guss GmbH and Craftsman Germany GmbH had acquired 100% of the Equity stake of Craftsman Fronberg Guss Immobilien GmbH. Subsequently, Craftsman Fronberg Guss Immobilien GmbH became a Stepdown Subsidiary of the Company with effect from 1^st October, 2024.

For the financial year 2024-25, the Company has declared a Final Dividend of Rs.5on the Equity Shares of Rs.5/- each with total outlay of Rs.11.93 Crores.

The Board of Directors at their meeting held on 7^th May, 2025, has recommended payment of Rs.5(Rupees Five) per Equity Share, being 100% on the face value of Rs.5each as final dividend for the financial year ended 31^st March, 2025. The payment of dividend is subject to the approval of the shareholders at the 39^th Annual General Meeting ("AGM") of the Company. The dividend, if approved by the members, would involve a cash outflow of Rs.11.93 Crores. The dividend pay-out is in accordance with the dividend distribution policy of the Company.

In view of the changes made under the Income Tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the shareholders. Your Company shall, accordingly, make the payment of the dividend after deduction of tax at source at appropriate rates applicable to resident and non-resident shareholders as the case may be.

Pursuant to the provisions of Regulation 43A of the Listing Regulations as amended from time to time, the Company has formulated Dividend Distribution Policy. The policy is available on the Company's website at https:// www.craftsmanautomation.com/investors/wp-content/ uploads /2022/08/14.CAL-Dividend-Distribution-Policy.pdf

In accordance with the provisions of Sections 124 and 125 of the Act and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), dividend of a Company which remain unpaid or unclaimed for a period of seven years from the date of transfer to the Unpaid Dividend Account shall be transferred by the Company to the Investor Education and Protection Fund ("IEPF").

In terms of the foregoing provisions of the Act, there is no dividend which remains outstanding or remain to be paid and required to be transferred to the IEPF by the Company during the financial year ended 31^st March, 2025.

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

The Paid-up Capital of the Company at the beginning of the financial year was Rs.10,56,41,555 divided into 2,11,28,311 Equity Shares of Rs.5/- each fully paid up.

The Board of Directors of the Company at their meeting held on 27^th April, 2024 had approved and recommended to the Shareholders of the Company for raising of funds up to Rs.1200 Crores through Qualified Institutions Placement ("QIP"). Subsequently, the Shareholders of the Company approved the same at the 38^th Annual General Meeting held on 27^th May, 2024.

Accordingly, during the financial year, the Company had issued 27,27,272 Equity Shares of face value of Rs.5through QIP raising a sum of Rs.1200 Crores.

Hence, post the issue, the paid-up share capital of the Company was Rs.11,92,77,915 divided into 2,38,55,583 Equity Shares of Rs.5/- each.

During the year, there was no change in the registered office of the Company.

The Company has not transferred any amount to the Reserves for the financial year ended 31^st March, 2025.

Pursuant to Regulation 34(2)(e) of the Listing Regulations, Management Discussion and Analysis Report forms part of this report as Annexure - 1.

Pursuant to Regulation 34(3) of the Listing Regulations, a report on Corporate Governance along with a Certificate from the Company Secretary in Practice confirming the compliance of the provisions of Corporate Governance forms an integral part of this Annual Report and are given in Annexure - 2 and Annexure - 3 respectively.

In accordance with the requirements of Section 135 of the Act and the Rules made there under, the Company has constituted a Corporate Social Responsibility (CSR) Committee and also formulated a Corporate Social Responsibility Policy (CSR Policy) which is available on the website of the Company at https://www.craftsmanautomation.com/investors/wp- content/uploads/2022/08/1.-CAL-Policy-on-Co rporate-Social- Responsibility-1.pdf.

An Annual Report on CSR activities of the Company during the financial year 2024-25 as required to be given under Section 135 of the Act read with Rule 8 of the Companies (CSR Policy) Rules, 2014 has been provided as an Annexure - 4 to this Report.

There were no material changes and commitments affecting the financial position of the Company that have occurred between the end of financial year 2024-25, to which the Financial Statements relate and the date of signing of this report.

Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of the Listing Regulations, the Company has formulated and adopted a Risk Management Policy. The Company has been consciously following a policy of risk mitigation by diversifying its products, services, markets and customers. The key risk of exposure to the cyclicality of the automobile business is being mitigated by increasing the share of the Industrial & Engineering segment.

The following are the major risk concerns:

Some of the Company's business segments operates in a competitive environment and some of the Company's customers pursue a policy of maintaining more than one source for a product/service. The Company's senior management team closely monitors the market and devises various strategies to stay ahead of the competition.

The economy is still susceptible to the challenging global economic environment of increased trade tensions, protectionism and slowdown. It is also constrained by fiscal profligacy, implementation delays, and a weak financial sector.

The fortunes of the automobile industry are cyclical and the demand for vehicles are vulnerable to the interest rates and liquidity.

As already mentioned, the Company adopts the policy of risk diversification by broadening its products, services, market and customer base. The Company, over the years, built a good design, engineering and product development team. This has enabled the Company to come out with new products and services and in the contract manufacturing space, the Company is able to position itself as a one-stop solution provider to its customers. In addition, the Company has steadily invested over the years to build up world-class manufacturing and testing facilities at Coimbatore and other plants. The state-of-the-art machines, continuous improvement in the production processes, constant upgradation of employee skill levels, backward integration to tool, die and fixture making and JIT deliveries have created a strong competitive advantage for the Company.

The Board has constituted Risk Management Committee under the Chairmanship of Mr. Srinivasan Ravi, which reviews the various risks faced by the Company and advises the Board on risk mitigation plans. Risk Management policy may be accessed on the Company's website at the link: https://www.craftsmanautomation. com/investors/wp-content/uploads/2022/08/4.-CAL-Risk- Manage ment-Policy.pdf

The Company has formulated a comprehensive Whistle Blower Policy in line with the provisions of Section 177(9) and 177(10) of the Act and Regulation 22 of the Listing Regulations with a will to enable the stakeholders, including Directors and individual employees to freely communicate their concerns about illegal or unethical practices and to report genuine concerns to the Audit Committee of the Company.

The mechanism provides adequate safeguards against victimization of Directors or employees who avail the mechanism. The Whistle Blower Policy has been placed in the website of the Company at https://www. craftsmanautomation.com/i nvestors/wp-content/ uploads/2022/08/2.-CAL-WhistleBlow erPolicy.pdf

The Company has in place a policy on prevention, prohibition and redressal of Sexual Harassment at workplace in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Committee has been setup to redress the complaints received on the sexual harassment. All employees of the Company are covered under this policy.

The details of complaints received and disposed off during the financial year 2024-25 are as follows:

During financial year 2024-25, all contracts/ arrangements/ transactions entered into by the Company with related parties were in the ordinary course of business and on an arm's length basis. In Compliance with Regulation 23 of the Listing Regulations, all the Related Party Transactions undertaken by the Company and its subsidiaries are placed before the Audit Committee for prior approval, as required under the Act and Listing Regulations. A statement of all Related Party Transactions of the Company and its subsidiaries is placed before the Audit Committee for its review on a quarterly basis.

The Company has not entered into material contracts or arrangements or transactions with related parties in accordance with Section 188 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014. There were no materially significant Related Party Transactions made by the Company during the financial year that would have required shareholders' approval under the Listing Regulations. Neither the Company has entered into transactions not at arm's length.

Accordingly, the Company has no material related party transactions or transactions not on arm's length requiring disclosure under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 attached to this report as Annexure - 5. Members may refer to Note No. 3.5 to the Standalone Financial Statements, which sets out related party disclosures pursuant to IND AS-24.

The Company has adopted policy on Related Party Transactions and the same can be accessed on the Company's website at https://www.craftsmanautomation. com/investors/wp-content /uploads /2022 /08 /11.-CAL- RPT-Policv.pdf.

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

No application was made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (No 31 of 2016) during the financial year 2024-25.

No one-time settlement was done with any Bank / Financial Institutions during the financial year under review.

There were no significant/material orders passed by the regulators or courts or tribunals during the financial year 2024-25, impacting the going concern status and the Company's operations in the future.

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

During the year under review, CRISIL Ratings Limited, a credit rating agency registered with the Securities and Exchange Board of India, has reaffirmed the credit rating assigned to the long-term loan facilities as AA-/Stable and for the short-term loan facilities with A1+ vide letter dated 10^th May, 2024 and 13^th August, 2024.

The Company has not accepted any deposits falling within the meaning of Section 73 or 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014, during the financial year and as such, no amount on account of principal or interest on deposits from public was outstanding as on 31^st March, 2025.

The Company has always been singled out by its customers as a supplier partners known for its reliability and quality.

During the year, the Company has received the following awards:

During the year under review, Craftsman Europe B.V., Wholly Owned Subsidiary has posted a turnover of Rs.13.20 Crores (€ 14.56 Lakhs) in financial year 2024-25 as against Rs.20.00 Crores (€ 22.27 Lakhs) in the financial year 2023 - 24. The profit for the financial year 2024-25 amounted to C0.85 Crores as compared to Rs.2.16 Crores in the financial year 2023-24.

During the year under review, the Company had acquired 100% of the share capital of Craftsman Germany GmbH, Germany, along with its subsidiary, Craftsman Fronberg Guss GmbH, Germany, on 22^nd July, 2024. Consequently, Craftsman Germany GmbH became a Wholly Owned Subsidiary and Craftsman Fronberg Guss GmbH became a Stepdown Subsidiary of the Company with effect from that date.

Further, on 1^st October, 2024, Craftsman Fronberg Guss GmbH had acquired the assets of Fronberg Guss GmbH and commenced operations as a manufacturing entity engaged in producing cast iron components for stationary engines. On the same date, Craftsman Germany GmbH had acquired 100% of the Equity stake of Craftsman Fronberg Guss Immobilien GmbH, thereby making it a Stepdown Subsidiary of the Company with effect from 1^st October, 2024.

Craftsman Germany GmbH, along with its subsidiaries, has posted a turnover of Rs.130.54 Crores (€ 143.30 Lakhs) and the profit for the financial year 2024-25 amounted to Rs.1. 17 Crores.

During the year under review, the Company had acquired 24% of the remaining Equity Share Capital of DR Axion India Private Limited ("DR Axion"). Consequently, DR Axion became a Wholly Owned Subsidiary of the Company w.e.f. 1^st July, 2024. DR

Axion has posted a turnover of Rs.1298.52 Crores for the financial year 2024-25 as against Rs.1246.15 Crores in the financial year 2023-24. The profit for the financial year 2024-25 amounted to Rs.12712 Crores as compared to Rs.136.89 Crores in the financial year 2023-24.

During the year under review, the Company had acquired 100% paid-up capital of Sunbeam Lightweighting Solutions Private Limited ("Sunbeam"). Accordingly, w.e.f. 9^th October, 2024, Sunbeam became a Wholly Owned Subsidiary of the Company. Sunbeam has posted a turnover of Rs.584.62 Crores and loss of Rs.10.70 Crores from the date of acquisition till 31^st March, 2025.

Carl Stahl Craftsman Enterprises Private Limited is an associate Company in which the Company is holding 30% of Equity Shares, posted a turnover of Rs.78.36 Crores in financial year 2024-25 as against the Rs.76.72 Crores in financial year 2023-24. The Profit for financial year 2024-25 was Rs.3.33 Crores as against the profit of Rs.2.82 Crores in financial year 2023-24.

Pursuant to Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Company's Subsidiaries and Associate Company in Form No. AOC-1 is attached to this report as Annexure - 6.

During the year under review, there has been no change in the Company's nature of business.

The Board of the Company is duly constituted. None of the Directors of the Company are disqualified under the provisions of the Act or the Listing Regulations.

In accordance with the provisions of the Act and Articles of Association of the Company, Mr. Ravi Gauthamram (DIN: 06789004), Whole Time Director, retires by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting (AGM). His reappointment is placed for approval of the members and forms part of the notice of the 39^th AGM. The information about the Director seeking his re-appointment as per Para 1.2.5 of Secretarial Standards on General Meetings and Regulation 36(3) of the Listing Regulations has been given in the notice convening the 39^th AGM.

Pursuant to Section 2(51) and 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following are the Key Managerial Personnel (KMP) of the Company:

i. Mr. Srinivasan Ravi, Chairman and Managing Director;

ii. Mr. Ravi Gauthamram, Whole Time Director;

iii. Mr. C.B.Chandrasekar, Chief Financial Officer;

iv. Mr. Thiyagaraj Damodharaswamy, Chief Operating Officer -Powertrain;

v. Mr. Shainshad Aduvanni, Company Secretary.

The remuneration and other details of these KMP for financial year 2024-25 are provided in the Annual Return, which is available on the website of the Company.

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

The Composition of the Audit Committee (AC):

1. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director (Chairman);

2. Mr. Sundararaman Kalyanaraman,

Independent Director (Member);

3. Mrs. Vijaya Sampath, Independent Director (Member);

4. Mrs. Rajeswari Karthigeyan, Independent Director (Member).

During the financial year 2024-25, the AC met five times on 27^th April, 2024, 24^th July, 2024, 10^th October, 2024, 23^rd October, 2024 and 29^th January, 2025.

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

1. Mrs. Vijaya Sampath, Independent Director (Chairperson);

2. Mr. Sundararaman Kalyanaraman,

Independent Director (Member);

3. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director (Member).

During the financial year 2024-25, the NRC met three times on 27^th April, 2024, 24^th July, 2024 and 29^th January, 2025.

The Composition of the Stakeholders Relationship Committee (SRC):

1. Mr. Sundararaman Kalyanaraman,

Independent Director (Chairman);

2. Mr. Srinivasan Ravi, Chairman and Managing Director (Member);

3. Mrs. Rajeswari Karthigeyan, Independent Director (Member).

During the financial year 2024-25, the SRC met once on 29^th January, 2025.

The Composition of the Corporate Social Responsibility (CSR) Committee:

1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);

2. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director (Member);

3. Mrs. Vijaya Sampath, Independent Director (Member).

During the financial year 2024-25, the CSR Committee met two times on 27^th April, 2024 and 29^th January, 2025.

The Composition of the Risk Management Committee (RMC):

1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);

2. Mr. Ravi Gauthamram, Whole Time Director (Member);

3. Mr. Sundararaman Kalyanaraman,

Independent Director (Member);

4. Mr. C.B.Chandrasekar, Chief Financial Officer (Member);

During the financial year 2024-25, the RMC met two times on 27^th August, 2024 and 20^th March, 2025.

The Composition of the Management Committee:

1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);

2. Mr. Ravi Gauthamram, Whole Time Director (Member).

During the financial year 2024-25, no meeting of Management Committee was held.

The Board had constituted a Fund Raising Committee at their meeting held on 27^th April, 2024 for facilitating fund raising with the following Members:

1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);

2. Mr. Ravi Gauthamram, Whole Time Director (Member).

3. Mr. Sundararaman Kalyanaraman, Independent Director (Member);

During the financial year 2024-25, the Fund Raising Committee met three times; once on 18^th June, 2024, and twice on 21^st June, 2024.

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

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

Adequate internal financial controls are in place which ensures the reliability of financial and operational information. The regulatory and statutory compliances are also ensured. The Oracle enterprise wide resource platform deployed in the Company enables the business processes and also ensures financial discipline and fosters accountability.

The Shareholders at their meeting held on 20^th May, 2020 had appointed M/s. Sharp & Tannan, Chartered Accountants, A-Wing, 602, Anna Salai, Chennai - 600 006 (Firm Registration No: 003792S), as the Statutory Auditors of the Company for a second term term of 5 years from the conclusion of the 34^th AGM (2020) till the conclusion of 39^th AGM (2025).

The Board of Directors at their meeting held on 13^th June, 2025, based on the recommendation of the Audit Committee, had approved and recommended to the Members, the re-appointment of M/s. Sharp & Tannan, Chartered Accountants as the Statutory Auditors of the Company a second term of 5 years from the conclusion of the 39^th AGM till the conclusion of the 44^th AGM (i.e., from the financial year 2025-26 to financial year 2029-30).

There are no qualifications, reservations or adverse remarks made by M/s. Sharp & Tannan, Statutory Auditors in their report for the financial year ended 31^st March, 2025.

M/s. Kumbhat and Co LLP Chartered Accountants, Coimbatore, who are the Internal Auditors, have carried out internal audit for the financial year 2024-25. Their reports were reviewed by the Audit Committee.

During the financial year 2024-25, the Company was required to maintain cost records under the Companies (Cost Records and Audit) Rules, 2014. Accordingly, cost records have been maintained by the Company, which are being audited by M/s. S. Mahadevan & Co, Cost Accountants, Coimbatore (Firm Registration No. 000007).

In accordance with Section 148 of the Act, the Board of Directors of the Company at their meeting held on 13^th June, 2025, on recommendation of the Audit Committee, has re-appointed M/s. S. Mahadevan & Co, Cost Accountants, Coimbatore, (Firm Registration No: 000007) as the Cost Auditors to conduct the Audit of the Cost Accounting Records maintained by the Company for the financial year 2025-26. M/s. S. Mahadevan & Co have confirmed that their appointment is within the limits of Section 141(3)(g) of the Act and has also certified that they are free from any disqualifications specified under Section 141(3) read with Section 148(5) of the Act.

As per the provisions of the Act, a resolution seeking Members' ratification for the remuneration payable to M/s. S. Mahadevan & Co, Cost Auditors for the financial year 2025-26 is included at item no 6. of the Notice convening the 39^th AGM.

Pursuant to the Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors had appointed M/s. KSR & Co Company Secretaries LLP (LLPIN: AAB-3259) Coimbatore as the Secretarial Auditors of the Company to undertake the Secretarial Audit of the Company for the financial year 2024-25.

The Secretarial Audit Report in Form MR-3 forms part of the Directors' Report as Annexure - 7.1. The report does not contain any qualification, reservation, adverse remark or disclaimer.

The Secretarial Audit Reports of DR Axion India Private Limited and Sunbeam Lightweighting Solutions Private Limited, ("the Wholly Owned Subsidiaries") in Form MR-3 are attached to this report as Annexure - 7.2 and as Annexure-7.3. The Secretarial Audit Report of the Wholly Owned Subsidiaries do not contain any qualification, reservation, adverse remark or disclaimer.

The Board of Directors at their meeting held on 13^th June, 2025, based on the recommendation of the Audit Committee, had approved and recommended to the Members, the appointment of M/s. KSR & Co Company Secretaries LLP (LLPIN: AAB-3259) Practicing Company Secretaries as the Secretarial Auditors of the Company for a term of 5 years from the financial year 2025-26 to financial year 2029-30.

The Company has undertaken an audit for the financial year ended 31^st March, 2025, for all applicable compliances as per Regulation 24A of the Listing Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report issued by M/s. KSR & Co Company Secretaries LLP, was submitted to the Stock Exchanges as per the Listing Regulations.

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

During the financial year 2024-25, the Board of Directors had met Seven (7) times and the details of the meetings of the Board and its Committees are given in the Corporate Governance Report (Annexure 2). The gap intervening between two meetings were within the time prescribed under the Act and Listing Regulations.

Details of attendance of meetings of the Board, its Committees and the Annual General Meeting/ Postal Ballot are included in the Report on Corporate Governance, which forms part of this Annual Report.

In terms of requirements under Schedule IV of the Act and Regulation 25(3) of Listing Regulations, a separate meeting of the Independent Directors was held on 22^nd October, 2024 and 20^th March, 2025.

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

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

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

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

The Company has received declarations from each Independent Director of the Company under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations confirming compliance with the criteria of independence as stipulated under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and there has been no change in the circumstances which may affect their status as Independent Directors during the financial year 2024-25.

All Independent Directors of the Company have affirmed compliance with Schedule IV of the Act and the Company's Code of Conduct for Directors and Employees for the financial year 2024-25.

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

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

The Company has adopted a familiarization programme for Independent Directors with an objective of making the Independent Directors of the Company accustomed with the business and operations of the Company through various structured orientation programme. The familiarization programme also intends to update the Directors on a regular basis on any significant changes therein so as to be in a position to take well-informed and timely decisions.

The details of the familiarization programme undertaken have been uploaded on the Company's website and the same is accessible at the web-link https:// www.Craftsmanautomation. Com /investors/corporate-governance/#2

Pursuant to the provisions of the Act, Listing Regulations and as per Guidance Note on Board Evaluation issued by SEBI on 5^th January, 2017, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as evaluation of the working of its Committees at their meeting held on 29^th January, 2025.

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

The Company has, on the recommendation of the Nomination & Remuneration Committee, framed and adopted a Nomination and Remuneration Policy in terms of the Section 178 of the Act with effect from 02^nd July, 2018. The policy, inter alia lays down the principles relating to appointment, cessation, remuneration and evaluation of Directors, Key Managerial Personnel and Senior Management Personnel of the Company.

The Nomination & Remuneration Policy of the Company is available on the website of the Company at web-link https://www.craftsmanautomation.com/investors/wp-content/ uploads /2022/08/3.-CAL-No mination-Remuneration-and- Board-Evaluation-Policy.pdf.

The details as required under Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure - 8 of this Report.

In terms of provisions of Section 197(12) of the Act and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing names of the employees drawing remuneration and other particulars, as prescribed in the said Rules forms part of this report. However, in terms of first proviso to Section 136(1) of the Act, the Annual Report, excluding the aforesaid information, is being sent to the members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours and any member who is interested in obtaining these particulars may write to the Company Secretary of the Company.

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

Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective for the financial year 2024-25 have been given in the Business Responsibility and Sustainability Report (BRSR) as per the format specified by SEBI Circular No. S E BI/H O/C F D/C F D-S E C-2/P/CIR/2023/122 dated 12^th July, 2023, which forms part of this report as Annexure - 9. The Company's ESG profile can be accessed through

The information pertaining to details of conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are as follows:

a) The Company is replacing low Efficient Screw Air Compressor with new High Capacity and Efficient Air Compressors, which results in energy saving and reducing no of compressors.

b) The existing LED lamps are replaced with high coverage and high-efficiency LED lamps, due to which number of fitting are reduced.

c) 3 different capacity STPs converted into one single capacity STP

d) 90% of stabilizers were removed from the system by installing a standby capacity UPS system.

e) Screw Compressors were shifted to new high ventilated rooms as a result, Efficiency has improved.

f) The Company is in the process of using LNG instead of LPG for Melting Furnaces and PNG DG sets instead of Diesel Generator Set

g) A dedicated 33 KV feeder availed for Kothavadi for uninterrupted power and pure voltage, resulting in reduced diesel consumption because of very less power cuts.

h) 15 nos industrial fans replaced with 1 number energy efficient HVLS fan.

a) The Company is planning to purchase more volume of power from Third Party Wind and solar Energy.

b) In the Company's unit 3 plant located at Arasur, the Company is in the process of converting the incoming Government EB Power from 33KV HT Supply to 110KV EHT Supply for uninterrupted quality power, which will aid for energy savings.

c) The Company has installed a DC: 800KW/ AC 700KW Solar rooftop plant in Unit 3 plant, located at Coimbatore.

a) Solar Roof Top Plant

b) HT to EHT Conversion Power Project

c) PNG Generator sets (Piped Natural Gas)

The Company has effectively integrated and absorbed general technology in the area of UPS Cooling System, Generator by ordering PNG Generator sets instead of Diesel Generator sets and power consumption from 800Kw Roof Top Solar Power Plant.

The Company has not incurred any expenditure on Research and Development.

Details of earnings accrued and expenditure incurred in foreign currency are as given below.

The Directors' Responsibility Statement referred to in Section 134(3)(c) of the Act shall state that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(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 profit of the Company for that period;

(c) the Directors had 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 had prepared the annual accounts on a going concern basis;

(e) 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.

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

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

The Company has also formulated a 'Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI)' in compliance with the PIT Regulations.

The aforesaid Codes are posted on the Company's website and can be accessed by using web link at https:// www.craftsmanautomation.com/investors/wp-content/ uploads/2022/08/6.-CAL-Code-of-Con duct-under-SEBI- PITpdf and https://www.craftsmanautomation.com/

investors/wp-content /uploads / 2022/08/7-CAL-Code-of- Fair-Disclosure-of-UPSI.pdf

In the opinion of Board of Directors of the Company, Independent Directors on the Board of Company hold highest standards of integrity and are highly qualified, recognized and respected individuals in their respective fields. It's an optimum mix of expertise (including financial expertise), leadership and professionalism.

As required under Regulation 17(8) of the Listing Regulations, the Managing Director and CFO of the Company have certified the accuracy of the Financial Statements and adequacy of Internal Control Systems for financial reporting for the financial year ended 31^st March, 2025. The Certificate is given in Annexure - 10.

The Code of Conduct of the Company aims at ensuring consistent standards of conduct and ethical business practices across the Company. This Code is available on the website of the Company at weblink https:// www.craftsmanautomation.com/investors/wp-content/ uploads/ 2022/08/10.-CAL-Code-of-Conduct-for-Directors- and-SM.pdf. Pursuant to the Listing Regulations, a confirmation from the Managing Director regarding compliance with the Code by all the Directors and Senior Management of the Company is given in Annexure - 11.

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

The Directors take this opportunity to thank the Shareholders, Bankers and the Financial Institutions for their cooperation and support to the operations and look forward for their continued support in future. The Directors also thank all the customers, vendor partners, and other business associates for their continued support during the financial year. The Directors place on record their appreciation for the hard work put in by all employees of the Company.