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To,

The Members,

Your Directors have pleasure in presenting their 34th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended 31^st March, 2026.

1. Financial summary

The financial results for the year are as under:

(Rupees in Lakhs)

2. Dividend

The Board of Directors had declared an interim dividend of Rs. 5.00 (Rupees Five Only) per equity share of Rs. 10 each (i.e. 50%) for the financial year 2024-25 at its meeting held on 15^th March, 2025.

Further, at its meeting held on 16^th July, 2025, the Board recommended an additional dividend of Rs. 6.00 (Rupees Six Only) per equity share of Rs. 10 each (i.e. 60%) for the financial year 2024-25.

Accordingly, the members at the Annual General Meeting of the Company held for the financial year 2024-25 approved the additional dividend of Rs. 6.00 per equity share, and the total dividend for the financial year 2024-25 stood at Rs. 11.00 (Rupees Eleven Only) per equity share of Rs. 10 each (i.e. 110%).

Further, the Board of Directors had declared an interim dividend of Rs. 12.00 (Rupees Twelve Only) per equity share of Rs. 10 each (i.e. 120%) for the financial year 2025-26 at its meeting held on 2^nd March, 2026.

Though the Company is among the top 2000 listed entities, it has voluntarily adopted a Dividend Distribution Policy in line with the provisions of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The said policy is available on the Company's website at: https://axtelindia.com/userfiles/corporate_governance/document/1629293145.pdf Investor Education and Protection Fund ("IEPF")/Unclaimed Dividends Pursuant to Section 124 of the Act, the dividends that are unpaid or unclaimed for a period of seven years shall be transferred to the Investor Education and Protection Fund along with the underlying shares on which such dividend remains unclaimed. Details of transfers to IEPF during the year under review are as follows:

3. Reserves

Your Board does not propose to carry to any reserves for the financial year 2025-26.

4. Brief description of the Company's working during the year/State of Company's affair

Total turnover during the year 2025-26 was Rs. 22,376.69 lakhs compared to Rs. 17,855.87 lakhs of previous year 2024-25 which shows increase of Rs. 4,520.82 lakhs (25.32%). There is profit of Rs. 3,115.96 lakhs (after tax) during the year 2025-26 compared to profit of Rs. 1,802.52 lakhs (after tax) during the year 2024-25.

5. Change in the nature of business, if any

There is no change in the nature of business during the financial year 2025-26.

6. Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report

No material changes occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

7. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future

No significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future during the financial year and or subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

8. Details in respect of adequacy of internal financial controls with reference to the Financial Statements.

The Company has appointed internal auditor for adequacy of internal financial controls and your Board has taken adequate care for financial control.

9. Details of Subsidiary/Joint Ventures/Associate Companies

Your Company has no Subsidiary/Joint Ventures/Associate Companies during the year.

Your Company has no Subsidiary/Joint Ventures/Associate Companies during the year.

Your Company has not accepted any deposit during the year and there was no deposit at the beginning of the year. Therefore the details relating to deposits, covered under Chapter V of the Act is not applicable.

M/s. VRCA & Associates, Chartered Accountants has been appointed for a period of five years pursuant to the provisions of section 139 of the Companies Act 2013 at the AGM held on 29^th September, 2022 and is eligible to act as statutory auditor for the current financial year.

M/s. Sharp & Tannan, Chartered Accountants were appointed at the meeting of the board of directors held on 13^th May, 2025 for FY 2025-26 for conducting internal audit of the Company.

The observations of the Auditors are explained, wherever necessary, in an appropriate note to the Audited Statement of Accounts. No qualification, reservation or adverse remark or disclaimer has been made by the auditor in their auditors' report for the year 2025-26.

During the year under review, the Company has not issued any securities nor has granted any stock option or sweat equity.

With a view to attract, reward and retain talented and key employees in a competitive environment and to encourage them to align individual performance with the Company's objectives, the Company has introduced 'Axtel Industries Limited Employee Stock Option Plan 2024' ("ESOP 2024" / "Scheme").

The Scheme is in compliance with the provisions of the Companies Act, 2013 and the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and is administered by the Nomination and Remuneration Committee, however, no stock options have been granted under the scheme during the financial year 2025-26.

The certificate from the Secretarial Auditor confirming that the Scheme has been implemented in accordance with the applicable laws and the aforesaid SEBI Regulations is annexed to this Report as Annexure H.

Further, the detailed disclosures as required under Regulation 14 read with Schedule V of the aforesaid SEBI Regulations have been hosted on the website of the Company and can be accessed at www.axtelindia.com

As per latest amendment in section 92 of the Companies Act, 2013, a copy of annual return will be displayed on Company's web site i.e. www.axtelindia.com after filing annual return, on completion of ensuing annual general meeting with the Registrar of Companies within the time stipulated in said Section 92 of Act.

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are attached herewith (Annexure-A)

The Company is required to spend towards corporate social responsibility under section 135 of the Companies Act, 2013. The Annual report on CSR Activities for the year under review as per Annexure II inserted vide MCA notification dated 22^nd January, 2021 in terms of section 135 of the Companies Act, 2013 is attached in Annexure D.

A) Following changes incorporated during the financial year 2025-26:

1. CS Prerna Bokil, Company Secretary & Compliance Officer tendered her resignation and the same was accepted with effect from 31^st May, 2025 at the Board Meeting held on 13^th May, 2025.

2. CS Dharaben Mehulkumar Thakar was appointed as Company Secretary and Compliance Officer of the Company with effect from 2^nd June, 2025 at the Board Meeting held on 13^th May, 2025.

3. Mr. Ajitsingh Mohansingh Bubber (DIN 00454111), retires by rotation, reappointed at the annual general meeting of the Company held on 19^th August, 2025.

A declaration, by Independent Directors that they have met the criteria provided in sub-section (6) of Section 149 of the Companies Act, 2013, have been received.

The Independent Directors of the Company have also confirmed compliance of relevant provisions of Rule 6 of the Companies (Appointments and Qualifications of Directors) Rules, 2014.

Mr. Ameet Nalin Parikh (DIN 00007036), retires by rotation at the ensuing annual general meeting and being eligible offered himself for re-appointment as Director and has given his consent and declaration under Form DIR-8 pursuant to Section 164(2) read with Rule 14(1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

Details of Mr. Ameet Nalin Parikh, Director seeking re-appointment as per Regulation 36 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 with the Bombay stock exchange is already annexed to the notice of the annual general meeting.

The Company has devised a policy for performance evaluation of Independent Directors, Board, Committees and individual Directors which includes criteria for performance evaluation of executive directors and non-executive directors.

In evaluating the suitability of individual Board members, the Committee may take into account factors, such as: i. General understanding of the Company's business; ii. Educational back ground and experience: iii. Personal and professional ethics, integrity and values; iv. Willingness to devote sufficient time and energy in carrying out their duties and responsibilities effectively.

Your Board is of opinion that independent directors of the Company, possess requisite qualifications, experience and expertise and they hold good standard of integrity in various fields.

During the year from 1^st April, 2025 to 31^st March, 2026, the Board of Directors met five times on the following dates:

The intervening gap between the Meetings was within the period prescribed under Companies Act, 2013 and the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with the erstwhile Listing Agreement.

The members of the Audit Committee of the Company as on 31^st March, 2026 are as under:

There was no occasion regarding non-acceptance of any recommendation of the Audit Committee during the year.

The Audit Committee Meetings were duly convened during the year ended 31^st March, 2026 on following dates: 13-05-2025, 16-07-2025, 11-11-2025, 02-02-2026 & 02-03-2026

The Board has appointed the following persons as members of vigil committee:

The Company has framed a whistle blower policy in terms of listing agreement and the same may be accessed on the Company's website.

The members of the Nomination and Remuneration Committee of the Company as on 31^st March, 2026 are as under:

The policy formulated by nomination and remuneration committee:

The terms of reference of the committee inter alia include succession planning for Board of Directors and Senior Management Employees, identifying and selection of candidates for appointment of Directors/Independent Directors based on certain laid down criteria, identifying potential individuals for appointment of Key Managerial personnel and other senior managerial position and review the performance of the Board of Directors and Senior Management personnel including Key managerial personnel based on certain criteria approved by the Board. While reviewing the performance, the committee ensures that the remuneration is reasonable and sufficient to attract, retain and motivate the best managerial talents, remuneration commensurate with the performance of individual and group and also maintains a balance between both short and long-term objectives of the company. The Nomination and Remuneration Committee Meeting was held on 13-05-2025 & 02-03-2026 during the year ended 31^st March, 2026.

The members of the CSR Committee of the Company as on 31^st March, 2026 are as under:

The Corporate Social Responsibility Committee Meeting was held on 13-05-2025 during the year ended 31^st March, 2026.

The members of stakeholders Committee of the Company as on 31^st March, 2026 are as under:

The Stakeholders relationship Committee Meetings were duly convened during the year ended 31^st March, 2026 on following dates: 13-05-2025, 16-07-2025, 11-11-2025 & 02-02-2026

The members of Risk Management Committee of the Company as on 31^st March, 2026 are as under:

The Risk Management Committee of the Company were duly convened during the year ended 31^st March, 2026 on 16-07-2025 & 27-03-2026.

The Company has not given any loan, guarantees or made investments under section 186 to any person or body corporate except loan to employees of the Company as per Company's policy for employees and investment in mutual funds.

During the year under review, the Company have accorded consent for increase of limits under Section 186 of the Companies Act, 2013:

1. The Board of Directors, at its meeting held on May 13, 2025, approved the increase in limits for making investments out of surplus funds up to an amount not exceeding Rs. 105 crores.

2. The Members of the Company, at their meeting held on August 19, 2025, approved the increase in limits under Section 186 of the Companies Act, 2013, up to an overall maximum limit of Rs. 250 crores.

The Company has entered into contract or arrangement with related party referred to in sub-section (1) of section 188 of the Companies Act, 2013 with Morphis Business Advisory LLP, Bombay with effect from 1^st April, 2023 which has been approved by the Board of Directors at the meeting, held on 18^th May, 2023 for a period of five years.

Form No. AOC -2 regarding transactions under section 188 of the Companies Act, 2013 is enclosed herewith (Annexure-B).

Disclosures pursuant to section 197(12) of the Companies Act, 2013 read with Rule 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are enclosed herewith (Annexure-C).

The Secretarial Audit Report pursuant to section 204(1) of the Companies Act, 2013 given by M/s. Ruchita Patel & Associates, Practicing Company Secretaries has been enclosed herewith along with Annual Secretarial Compliance Report as required under Regulation 24A of LODR Regulations, 2015. (Annexure-E).

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

A detailed corporate governance report including compliance certificate received from M/s. Ruchita Patel & Associates, Practicing Company Secretaries, regarding compliance of conditions of corporate governance as stipulated in Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 is attached as Annexure F.

The management discussion and analysis report as stipulated in Regulation 34 (2) (e) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 has been annexed to Directors' report as Annexure G.

The Company has adopted a code of conduct for its directors and senior designated management personnel. All the Board members and senior management personnel have affirmed their compliance of code of conduct.

In today's economic environment, risk management is a very important part of business. The main aim of risk management is to identify, monitor and take precautionary measures in respect of the events that may pose risks for the business. Your Company's risk management is embedded in the business processes. Your company has identified the following risks:

Your Directors' 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 of the profit and loss 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 this 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 laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

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.

The Company has complied with secretarial standards issued by the Institute of Company Secretaries of India and SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015 from time to time.

Based on the recommendation of the Audit Committee, M/s. K. H. Shah & Co., Cost Accountants, being eligible, have been appointed by the Board of Directors in their meeting held on 13-05-2025 as the Cost Auditors for F.Y. 2025-26. The remuneration to be paid to M/s. K. H. Shah & Co., for F.Y. 2025-26 has been ratified by the shareholders of the AGM held on 19th August, 2025. Cost records as specified by the Central Government under sub-section 1 of section 148 of the Companies Act, 2013, are maintained by the Company for the financial year 2025-26.

There was no fraud reported by auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government.

There was no proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 during the year under review.

The Company has been employing about 13 women employees in various cadres within the factory premises. The Company has in place an anti-harassment policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee has been set up to redress complaints received regularly and are monitored by women line supervisors who directly report to the Executive Director. All employees (permanent, contractual, temporary, trainees) are covered under the policy.

39 Compliance with Maternity Benefit Act, 1961

The Company is in compliance with Maternity Benefit Act, 1961. Current Leave policy of the company is in line with provisions of Maternity Benefit Act, 1961 and other applicable labour laws and rules made thereunder. All employees are covered under the said policy.

39 A. Total employees

The Company has total 228 employees comprising of 215 male employees and 13 female employees during the year under review.

The Board of Directors gratefully acknowledge the assistance and co-operation received from the Bank of Baroda and all other statutory and non-statutory agencies for their co-operation. The Board of Directors also wish to place on record their gratitude and appreciation to the members for their trust and confidence shown in the Company. The Board of Directors would like to especially thank all the employees of the Company for their dedication and loyalty.