DIRECTORS' REPORT

Your Directors takes pleasure in presenting the Fiftieth (50^th) Annual Report and Audited Financial Statements of Afcons
Infrastructure Limited for the year ended 31^st March, 2026.

1. FINANCIAL RESULTS

The Company's financial performance for the year ended 31^st March,, 2026 is summarized below:

2. OPERATIONS AND BUSINESS PERFORMANCE

The details of the Company's affairs, including its
Operations and Business Performance are detailed below:

(a) Standalone Results

The total income, on standalone basis, for the
financial year under review is ' 12,308.38 Crores as
against ' 12,966.66 Crores for the previous financial
year showing a decrease of 5.08%. The Profit before
Tax for the year was ' 425.90 Crores compared to
' 809.30 Crores in the previous year resulting in
decrease of 47.37%. The Profit after Tax for the year
was ' 289.90 Crores as against ' 586.13 Crores in
the previous year resulting in a decrease by 50.54%.

(b) Consolidated Results

Your Company achieved total income of ' 12,322.10
Crores for the year as against previous year's
' 13,022.77 Crores showing a decrease of 5.38%.
The EBIDTA for the year was ' 1,362.26 Crores
compared to ' 1,661.80 Crores in the previous year
resulting in a decrease by 18.03%. The Consolidated
Profit before Tax for the year was ' 386.79 Crores

as against ' 710.01 Crores in the previous year
resulting in a decrease of 45.52%. The Consolidated
Profit after Tax for the year was ' 250.74 Crores
compared to ' 486.79 Crores in the previous year
resulting in a decrease by 48.49%.

For more details on the performance of the
Company, please refer to section on Management
Discussion and Analysis.

During the year, the Company, on a Consolidated basis,
bagged new orders valued around ' 4,125 Crores.
The pending order book of the Company as on
31^st March, 2026 stood at ' 32,496 Crores.

(c) Transfer to General Reserve

During the year under review, your Company has
not transferred any amounts to the General reserve.
For complete details on movement in Reserves and
Surplus during the financial year ended 31^st March,
2026, please refer to the 'Statement of Changes in
Equity' included in the standalone and consolidated
financial statements of this Annual Report.

3. SHARE CAPITAL

a. During the year under review, there was no change
in the Authorized Share Capital of your Company.
Accordingly, the Authorized Share Capital of your
Company remains unchanged at ' 1,750 Crores.

b. There was no change in the Issued, Subscribed and
Paid-Up Share Capital of the Company during the
year under review.

c. During the year under review, your Company has
not issued any shares with differential rights, sweat
equity shares and /or Preference shares.

4. UTILISATION OF ISSUE PROCEEDS

Pursuant to the listing of the Equity Shares of the
Company on the National Stock Exchange of India Limited
("NSE”) and BSE Limited ("BSE”) ("Stock Exchanges”) on
4^th November, 2024, the net proceeds of IPO had been
partially utilised in FY 2024-25 and the balance of the
issue proceeds was utilised on FY 2025-26 in line with
the object of the offer. The details of the ulitlisation of
issue proceeds of the IPO was submitted to Stock
Exchanges on quarterly basis and are also available on
the website of the Company at www.afcons.com.

5. FINANCE

a. During the year under review, your Company
has issued and alloted on private placement
basis, Listed, Rated, Unsecured, Redeemable,
Non-convertible Debentures (NCDs) aggregating
' 50 Crores. These NCDs are listed on the Wholesale
Debt Market segment of the National Stock
Exchange of India Limited. The funds raised through
issuance of NCDs were utilized as per the objects
stated in the General Information Document/ Key
Information Document.

b. During the year under review, the Company has
raised ' 390 Crores vide issuance of Listed /Unlisted
Commercial Papers (CPs) on a private placement
basis for funding the working capital of the
Company. Out of the said CPs an amount of
' 190 Crores has been repaid on maturity date and
as on 31^st March, 2026, there was an outstanding
CPs aggregating to ' 200 Crores.

c. The Company's borrowing programs have received
credit ratings from CRISIL Ratings Limited
("Crisil”) and India Ratings and Research Pvt Ltd.
("India Ratings”) as follows :

d. The Company has not defaulted on payment of any
dues to the financial lenders.

6. DEPOSITS

During the year under review, the Company has not
accepted any public deposits falling within the ambit
of Section 73 of the Companies Act, 2013 ("Act”) and
the Rules framed thereunder. The requisite return for
FY2024-25 with respect to amount(s) not considered
as deposits has been filed. The Company does not have
any unclaimed deposits as of date.

7. DIVIDEND

The Board of Directors of the Company ("Board”)
recommends a final dividend of 2/- per equity share of
10/- each for the financial year ended 31^st March, 2026
on the paid-up Share Capital of the Company resulting
into dividend outlay of ' 73.56 Crores. The dividend is
subject to approval of Members at the ensuing Annual
General Meeting ("AGM”) and deduction of tax at source,
as required under the law. The dividend, if approved,
would be paid to Members whose names appear in
the Register of Members as on the record date fixed
for this purpose.

The dividend payment is based upon the parameters
mentioned in the Dividend Distribution Policy approved
by the Board pursuant to SEBI (Listing Obligations
& Disclosure Requirements) Regulations, 2015
("SEBI Listing Regulations”). The Policy is uploaded
on the Company's website athttps://afcons.com/
corporate-aovernance/#policies . Dividend, if approved
by the Members, will be paid electronically pursuant
to the amendment to Regulation 12 notified by the
Securities and Exchange Board of India vide the SEBI
(Listing Obligations and Disclosure Requirements)
(Fifth Amendment) Regulations, 2025, effective
19^th November, 2025.

8. SUBSIDIARIES / ASSOCIATE / JOINT VENTURE

a. During the year under review the Company has
12 Subsidiaries (including foreign and step-down
subsidiaries), 1 Joint Venture Company and 14
unincorporated Joint Ventures (Joint Operations).

b. Pursuant to the provisions of Section 129 and
other applicable provisions, if any, of the Act
read with Rule 5 of Companies (Accounts) Rules,
2014 a statement containing salient features
of the financial statements of the Subsidiary,
Associate Company and Joint Ventures in Form
AOC-1 is annexed to the Financial Statements
of the Company.

c. The Consolidated Financial Statements presented
by the Company include financial statements of the
Subsidiaries, Associate Company (i.e. Joint Venture
Company) and Joint Ventures (Joint Operations)
prepared in accordance with the applicable
accounting standards.

d. In accordance with Section 136 of the Act
and the Rules framed thereunder, the Audited
Financial Statement, including the Standalone and
Consolidated Financial Statements and the related
information of the Company as well as the Audited
Financial Statements of the Subsidiary Companies,
are available on the website of the Company at
https://afcons.com/financials/.

e. The Audited Financial Statement of the Subsidiary
Companies are not attached with the Financial
Statements of the Company. The Company will
make available the Financial Statements of the
Subsidiary Companies and the related information
to any Member of the Company who may be
interested in obtaining the same.

f. The Company has formulated a policy on

identification of material subsidiaries in

accordance with Regulation 16(1)(c) of the SEBI
Listing Regulations and the same is placed on
the Company's website athttps://afcons.com/
corporate-aovernance/#policies.As of 31^st March,
2026, Afcons Singapore Pte. Ltd. is an unlisted
material Subsidiary of the Company.

g. There are no material changes in the nature of

business of the Company or any of its Subsidiaries,
Associate Company and Joint Ventures

(Joint Operations).

9. CORPORATE GOVERNANCE REPORT

Your Company, being a value driven organisation,
believes in coherent and self-regulatory approach in the
conduct of its business to achieve the highest levels of
good corporate governance practices.

Pursuant to Regulation 34 read with Schedule V of
the SEBI Listing Regulations, a Report on Corporate
Governance and a certificate obtained from the
Secretarial Auditors M/s. Parikh Parekh & Associates,
Practicing Company Secretaries (ICSI Firm Registration
Number P1987MH010000) confirming compliance with
Corporate Governance are set out and forms part of
this Annual Report.

10. MANAGEMENT DISCUSSION AND ANALYSIS
REPORT

A detailed review of the operations, performance and
future outlook of the Company and its businesses is
given in the Management Discussion and Analysis,
which forms part of this Annual Report.

11. BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORT

As per Regulation 34 of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015, a
separate section on Report on Business Responsibility
and Sustainability Reporting (BRSR) along with Limited
assurance on BRSR forms part of this Annual Report.
The details of number of employees of the Company as
at 31^st March,, 2026, is disclosed in the BRSR Report.

12. CORPORATE SOCIAL RESPONSIBILITY

The Company has a CSR & Sustainability (CSSR)
Committee in terms of the requirements of Section 135
of the Act read with the rules made thereunder.

The Company has framed Corporate Social Responsibility
(CSR) policy which is available on the Company's website
athttps://afcons.com/corporate-aovernance/#policies.

The initiatives taken by the Company on CSR
activities during the financial year is available on
the Company's website athttps://afcons.com/
corporate-aovernance/#policies

The detailed reports on the CSR activities are annexed
as "Annexure I" and forms part of this Report. The Chief
Financial Officer of the Company has certified that
CSR funds so disbursed for the CSR activities have
been utilised for the purpose and in the manner as
approved by the Board.

13. DIRECTORS AND KEY MANAGERIAL
PERSONNEL OF THE COMPANY

The Board of the Company is duly constituted in
accordance with the requirement of Section 149 of the
Act and Regulation 17 of the SEBI Listing Regulations.
Your Board comprises of 12 Directors (i.e. 3 Executive
Directors, 6 Independent Directors and 3 Non-Executive
Directors, Non-Independent Directors).

The Company's Board of Directors comprises individuals
with a proven track record of competence and integrity,
bringing a unique combination of global expertise, strong
financial acumen, strategic insight and exceptional
leadership qualities. In terms of the requirement of the
SEBI Listing Regulations, the Board has identified core
skills, expertise and competencies of the Directors in
the context of the Company's business for effective
functioning and how the current Board of Directors is
fulfilling the required skills and competencies. This is
detailed at length in the Corporate Governance Report.

Mr. Subramanian Krishnamurthy, Executive Chairman,
Mr. Srinivasan Paramasivan, Managing Director,
Mr. Giridhar Rajagopalan, Deputy Managing Director,
Mr. Ramesh Kumar Jha, Chief Financial Officer and
Mr. Gaurang Parekh, Company Secretary are the Key
Managerial Personnels ("KMPs”) as per provisions of
the Act. There has been no change in KMPs during the
year under review.

During the year under review, the following changes took
place in the composition of the Board of Directors:

1. Mr. Giridhar Rajagopalan (DIN: 02391515) was
re-appointed as a Whole-time Director designated
as Deputy Managing Director by the members of
the Company at the AGM held on 25^th July, 2025 for
a term of Two (2) years i.e. from 1^st July, 2025 to
30^th June, 2027.

2. Mr. Shapoorji Pallonji Mistry (DIN: 00010114)
stepped down from the position of Non Executive,
Non Independent Director and Chairman of the
Company w.e.f. 28^th August, 2025. The Board
placed on record its appreciation of the valuable
contribution of Mr. Shapoorji Mistry during the
tenure as Non Executive Director and as Chairman
of the Company. Considering his rich experience,
leadership, vision, and long association with the
Company, he was elevated to the position of
Chairman Emeritus of the Company, an honorary,
non board position without any remuneration or

fees, w.e.f. 29^th August, 2025 to provide guidance,
mentorship, and support to the Board and the
management of Afcons as and when necessary.

3. Mr. Subramanian Krishnamurthy (DIN: 00047592)
has been elevated to the position of Executive
Chairman of the Company w.e.f. 28^th August, 2025.

4. Mr. Pallon Shapoorji Mistry (DIN: 05229734)
has been appointed as an Additional Director
(Non Executive and Non Independent) of the
Company w.e.f. 29^th August, 2025. Mr. Firoz Cyrus
Mistry (DIN: 09543123) has been appointed as
an Additional Director (Non Executive and Non
Independent) of the Company w.e.f. 25^th September,
2025. Mr. Santosh Balachandran Nayar
(DIN: 02175871) has been appointed as
an Additional Director (Non Executive and
Independent) of the Company w.e.f.25^th September,
2025. Their appointment has been subsequently
regularised as Director of the Company by the
Members through the resolutions passed by postal
ballot on 10^th November, 2025.

5. The term of Mr. Subramanian Krishnamurthy
(DIN: 00047592), Whole-time Director designated
as Executive Chairman of the Company and
Mr. Srinivasan Paramasivan (DIN: 00058445)
Managing Director of the Company expires on
30^th June, 2026. Based on the recommendation
of the Nomination and Remuneration Committee
("NRC”), the Board at their meeting held on
18^th May 2026 has approved and recommended
to the Members their re-appointment and
remuneration for a further term of Two (2)
years i.e. from 1 ^st July, 2026 to 30^th June, 2028.
A resolution seeking Member's approval for their
re-appointment and remuneration forms part of
the Notice of this 50^th AGM.

6. Mr. Giridhar Rajagopalan (DIN: 02391515), Whole
time Director in the capacity of Deputy Managing
Director of the Company and Mr. Umesh N. Khanna
(DIN: 03634361), Non Executive, Non Independent
Director of the Company are liable to retire by rotation
at the ensuing 50^th AGM and being eligible, offer
themselves for re appointment. The Board on the basis
of the recommendation of the NRC, recommends to
the Members for their re-appointment at the 50^th AGM.

Information as required under the Act and the Secretarial

Standards on General Meeting ("SS-2”) issued by the

Institute of Company Secretaries of India, in respect of

Directors seeking appointment / re-appointment at this
AGM is disclosed in the Notice of the said AGM.

14. COMPANY'S POLICY ON APPOINTMENT
AND REMUNERATION OF DIRECTORS, KEY
MANAGERIAL PERSONNEL AND SENIOR
MANAGEMENT PERSONNEL.

The NRC has formulated a Policy on Directors'
appointment and remuneration including recommendation
of remuneration of the key managerial personnel and senior
management personnel, and the criteria for determining
qualifications, positive attributes, and independence of
a director. The Nomination and Remuneration Policy is
disclosed on the Company's website athttps://afcons.com/
corporate-governance/#policies .

Your Company respects every stakeholder and values
their unique differences. The Board Diversity Policy of
the Company complies with the legal standards and
acknowledges various other aspects of diversity, such
as gender, age, cultural and educational background,
professional experience, skills and knowledge,
networking, contribution of value and stakeholder
representation.

15. DECLARATION FROM INDEPENDENT
DIRECTORS

The Company has received declaration of independence,
as stipulated under Section 149(7) of the Act and
Regulation 25(8) of the SEBI Listing Regulations, from
all the Independent Directors confirming that he/ she:

i) meets the criteria of independence as prescribed
under Section 149(6) of the Act and under
Regulation 16(1)(b) of the SEBI Listing Regulations;

ii) continues to comply with the Code of Conduct laid
down under Schedule IV of the Act;

iii) is registered in the Independent Director's Databank
maintained by Indian Institute of Corporate
Affairs (IICA); and

iv) has in terms of Section 150 of the Act read with
Rule 6(4) of the Companies (Appointment and
Qualification of Directors) Rules 2014, undertaken/
exempted from undertaking the online proficiency
self-assessment test conducted by the IICA.

Further, pursuant to Section 164(2) of the Act, all the
Directors have provided declarations in Form DIR- 8
that they have not been disqualified to act as a Director.
Also, your Board is of the opinion that the Independent
Directors of the Company possess integrity, requisite

expertise, experience and proficiency and the details
thereof are given in the Corporate Governance Report.

Accordingly, based on the declarations received from
all Independent Directors, the Board has confirmed
that Independent Directors of your Company fulfil
the conditions specified in the Act and SEBI Listing
Regulations and are independent of management.

Your Company has issued formal letters of
appointment to the Independent Directors at the time
of their appointment. The terms and conditions of the
appointment of Independent Directors are available
on the Company's website athttps://afcons.com/
corporate-governance/#policies.

16. PERFORMANCE EVALUATION

During the year under the review, in compliance with
the provisions of the Act and SEBI Listing Regulations,
the Board has carried out an annual performance
evaluation of the Board, Committees of the Board, the
Individual Directors and the Chairman of the Company.
The evaluation was carried out through system driven
structured questionnaire taking into consideration
various aspects of the Board's functioning and
discharge of fiduciary duties by the Board, time devoted
by the Board to the Company's long term strategic
issues, quality and transparency of Board discussions,
timeliness of the information flow between Board
members and management, Board's effectiveness
in disseminating information to shareholders, etc.
All the Directors responded through the structured
questionnaire giving feedback about the performance
of the Board, its Committees, Individual Directors and
the Chairman of the Company. The Board performance
evaluation inputs were discussed in the meeting of the
Independent Directors, NRC and Board meeting held in
4^th February, 2026. The performance evaluation of the
Independent Directors was carried out by the entire
Board. The Directors expressed their satisfaction with
the evaluation process.

During the year under review, Two (2) meetings of
Independent Directors was held on 22^nd November,
2025 and 10^th February, 2026, without the presence of
Executive Directors or Management representatives,
whereat the Independent Directors reviewed the
performance of the Board of Directors as whole,
performance of the Non-Independent Directors (both
Non-executive and Executive) and performance of the
Chairman of the Company, taking into account the views
of Executive Directors and Non-Executive Directors
and also assessed the quality, quantity and timeliness
of the flow of information between the Company's

Management and the Board of Directors that is
necessary for the Board of Directors to effectively and
reasonably perform its duties.

17. DISCLOSURE OF REMUNERATION

The details of remuneration as required to be disclosed
under Section 197 (12) of the Act read with Rule 5(1)
of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 are given in
"Annexure II" to this Report. During the year, the Company
had 3730 (Previous Year 3892) permanent employees.

The statement containing information with respect
of remuneration of the employees as required under
Section 197(12) of the of the Act read with Rule 5(2) and
5(3) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 as amended
from time to time , forms part of this Report. In terms
of sub-section (1) of Section 136 of the Act, the Annual
Report is being sent to the Members and others entitled
thereto, excluding the aforesaid information. Any Member
interested in obtaining a copy of the same may write to the
Company Secretary atsecretarial@afcons.com. None of
the employees listed in the said Annexure is related to
any Directors of the Company.

18. CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO

Information as required to be given under Section 134(3)
(m) of the Companies Act, 2013 read with Rule 8(3) of
the Companies (Accounts) Rules, 2014 is provided in
"Annexure III" forming part of this Board Report.

19. MEETINGS OF THE BOARD

During the period under review, Eight (8) meetings of
the Board of Directors were held during the FY 2025-26.
The details of the meetings of the Board, are given in
the Corporate Governance Report which forms part of
this Annual Report. The intervening gap between the
meetings was within the period prescribed under the Act
and SEBI Listing Regulations.

20. BOARD COMMITTEES

In compliance with the provisions of the Act read
with Rules framed thereunder and the SEBI Listing
Regulations, your Board has constituted requisite
Committees namely, Audit Committee, Nomination and
Remuneration Committee, Stakeholder's Relationship
Committee, Corporate Social Responsibility and
Sustainability Committee, Risk Management Committee
and Committee of Directors.

The composition of all such Committees, number of
Meetings held during the year under review, brief terms
of reference, etc. are given in details in the Corporate
Governance Report which forms part of this Annual
Report. The minutes of the meetings of all Committees
are circulated to the Board for their discussion and noting.

During the year under review, all recommendations of
the Committees were accepted by the Board.

21. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134 of the
Act, the Board of Directors of the Company hereby state
and confirm that:

a. in the preparation of Annual Accounts, the
applicable accounting standards have been
followed along with proper explanation relating to
material departures; if any;

b. the Directors have selected such accounting
policies and applied them consistently and made
judgements 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
such Internal Financial Controls are adequate and
operating efficiently; 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 were operating effectively.

22. FAMILIARISATION PROGRAMME FOR
INDEPENDENT DIRECTORS

Pursuant to the Listing of the Company and in terms
of Regulation 25(7) of the SEBI Listing Regulations, the
details of familiarisation programme for the Independent
Directors are mentioned in Corporate Governance

Report which forms part of this Report and the said
details are also hosted on the website of the Company at
https://afcons.eom/corporate-aovernance/#policies.

23. DIRECTORS AND OFFICERS LIABILITY
INSURANCE (D&O)

Pursuant to Regulation 25(10) of the SEBI Listing
Regulations, the Company has taken the Directors and
Officers Liability Insurance ('D&O Insurance') policy for
all the Directors including Independent Directors of the
Company for indemnifying them against any liability in
respect of any negligence, default, misfeasance, breach
of duty, or breach of trust for which they may be guilty in
relation to the Company.

24. SUCCESSION PLANNING

The Nomination and Remuneration Committee of the
Company oversees matters related to succession
planning of the Board and Senior Management of
the Company. The Company understands that sound
succession planning is essential for sustained growth of
the Company. Accordingly, the Company has an effective
mechanism for succession planning which focuses
on orderly succession of Directors, Key Management
Personnels and Senior Management.

25. QUALITY, HEALTH, SAFETY & ENVIRONMENT

The Company firmly believes that the pursuit of
excellence is one of the most critical components for
a competitive success. With Quality, Health, Safety &
Environment being an essential part of the Company's
policy, it strives to deliver services by maintaining
the highest level of Quality, Health, and Safety &
Environmental Standards.

The policy of the Company is to conduct its construction
business through an established Quality, Health,
Safety & Environmental (QHSE) Management System,
which aims to achieve customer satisfaction and, in
the process, a continual improvement of Company's
competencies and competitiveness.

The Company is certified for ISO 9001:2015 for Quality
management System, ISO 14001:2015 & ISO 45001:2018
for Occupational Health Safety & Environment
Management System. All the three systems are well
established, documented, implemented, and maintained
across the Company.

The Company has commendable records in terms
of safety at our various project sites and has received
awards and letter of appreciation from our Client and
several domestic and internation Safety Councils and
Industrial Bodies.

26. AUDITOR AND AUDITOR'S REPORTa. Statutory Auditors and their Report

i. Deloitte Haskins & Sells LLP, Chartered
Accountants (ICAI Firm Registration
No.117366W/W-100018) ("DHS”) had been
appointed as one of the Joint Statutory
Auditors of the Company for a first term of
five years effective from the Forty-Sixth (46^th)
AGM held on 29^th September, 2022 till the
conclusion of the Fifty-First (51 ^st) AGM to
be held in the calendar year 2027. DHS have
provided their respective consents, certificates
and declarations as required under Section
139 and 141 of the Act and Companies (Audit
and Auditors) Rules, 2014.

ii. HDS & Associates LLP Chartered Accountants
(ICAI Registration No. W100144) ("HDS”) were
appointed as Joint Statutory Auditors of the
Company for their second term of five years
effective from the Forty-Fifth (45^th) Annual
General Meeting held on 27^th September,
2021, and shall hold office till the conclusion
of the ensuing Fiftieth (50^th) Annual General
Meeting. Accordingly, HDS will complete
their second term at the conclusion of the
ensuing Annual General Meeting, upon which
DHS shall continue as the sole Statutory
Auditors of the Company in accordance
with the provisions of the Act and applicable
regulatory requirements.

iii. DHS and HDS being the Joint Statutory
Auditors of the Company, have conducted
Statutory Audit of the Standalone and
Consolidated Financial Statements of the
Company for the Financial Year 2025-26.

iv. The Audited Standalone and Consolidated
Financial Statements of the Company
for FY 2025-26 along with the Auditors
report have been approved by the Audit
Committee and the Board of Directors of the
Company at their respective meetings held
on 18^th May, 2026. The Statutory Auditor's
Report for FY 2025-26 does not contain any
qualifications, observations, reservations or
adverse remarks. The Notes on the Financial
Statements are self-explanatory and do not
call for any further comments.

b. Secretarial Auditor and their Report

Pursuant to section 204 of the Act and the
Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Company
has appointed Parikh Parekh & Associates,
Company Secretaries in Practice to undertake the
Secretarial Audit of the Company for FY 2025-26.
The Report of the Secretarial Auditor is enclosed as
"Annexure IV" to this Board Report. The Secretarial
Audit Report does not contain any qualifications,
reservations or adverse remark.

c. Cost Auditor

As per Section 148 of the Act read with the
Companies (Cost Records and Audit) Rules, 2014,
the Company is required to prepare and maintain
cost records and have the cost records audited
by a Cost Accountant and accordingly, as per
the recommendation of the Audit Committee,
the Board of Directors at its meeting held on
23^rd May, 2025, appointed M/s. Kishore Bhatia &
Associates (Firm Registration No. 00294), a Firm
of Cost Accountants as the Cost Auditor of the
Company for FY 2025-26 for maintaining such
cost accounts and records. The Report of the Cost
Auditors for the financial year ended 31^st March,
2026 shall be filed with the Ministry of Corporate
Affairs within the prescribed period.

The Board at its meeting held on 18^th May, 2026,
on the recommendation of the Audit Committee,
has appointed M/s. Kishore Bhatia & Associates
(Firm Registration No. 00294), a Firm of Cost
Accountants as the Cost Auditor of the Company
for FY 2026-27 under Section 148 and all other
applicable provisions of the Act at a remuneration
of ' 3,30,000 (Rupees Three Lacs Thirty Thousand
Only) plus applicable taxes and out of pocket
expenses at actuals. The Cost Auditor has
confirmed that their appointment is within the limits
of Section 141(3)(g) of the Act and they are free from
disqualifications as specified under Section 148(3)
read with Section 141(4) of the Act. They have
further confirmed their independent status and an
arm's length relationship with the Company.

The remuneration payable to the Cost
Auditor is required to be placed before the
Members at the General Meeting for their
ratification. Accordingly, a resolution seeking
Members' ratification for the remuneration of
M/s. Kishore Bhatia & Associates (Firm Registration

No. 00294) FY 2026-27 is included in the Notice
convening the AGM.

h. Reporting of Frauds

None of the Auditors of the Company has identified
and reported any fraud as specified under the
second proviso of Section 143(12) of the Act during
the year under review.

27. COMPLIANCE WITH SECRETARIAL
STANDARDS

The Directors have devised proper systems to ensure
compliance with the provisions of all applicable
Secretarial Standards issued by the Institute of Company
Secretaries of India and that such systems are adequate
and operating effectively. During the year under review,
the Company has complied with applicable Secretarial
Standards on Board and General Meeting.

28. ADEQUACY OF INTERNAL FINANCIAL
CONTROLS:

The Company has robust management information
system, which is an integral part of the control
mechanism. The Internal Financial Controls with
reference to financial statements as designed
and implemented by the Company are adequate.
The Company's internal financial controls ensure the
reliability of data and financial information, accuracy &
completeness in maintaining accounting records and
prevention & detection of frauds & errors.

Your Company has adopted accounting policies which
are in line with the Accounting Standards prescribed
in the Companies (Accounting Standards) Rules,
2006 that continue to apply under Section 133 and
other applicable provisions, if any, of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014 and
relevant provisions of the Companies Act, 1956, to the
extent applicable.

The Audit Committee of the Board actively reviews
the adequacy and effectiveness of the internal control
system and suggests improvements to strengthen the
same. For the year end 31^st March, 2026, the Board
considers that the Company has sound Internal Financial
Controls commensurate with the nature and size of
its business operations and the same are operating
effectively and there is no material weakness. During the
year under review, no material or serious observation
has been received from the Statutory Auditors and the
Internal Auditors of the Company on the inefficiency or
inadequacy of such controls.

29. TRANSFER TO INVESTOR EDUCATION AND
PROTECTION FUND (IEPF)

The Company has been regularly sending
communications to the Members whose dividends are
unclaimed, requesting them to provide/update bank
details with the Registrar and Shares Transfer Agent
("RTA”)/ Company, to ensure timely credit of dividends
by the Company. Additionally, efforts are made by the
Company in co-ordination with the RTA to locate the
shareholders who have not claimed their dividend.

Despite several reminders sent to the members vide
registered post at their registered postal addresses
and through newspaper advertisements calling upon
the shareholders to claim their unclaimed dividends,
34 shareholders did not claim dividend aggregating
to ' 40,649/- (Rupees Forty Thousand Six Hundred
and Forty-Nine only) for FY 2018-19, which remained
unclaimed for seven years has been transferred to
Investor Education and Protection Fund (IEPF) Authority
on 5^th May, 2026.

Further, during the period under review, 4 shareholders
holding a total of 1784 equity shares (constituting a
negligible percentage of the total equity shareholding)
did not claim dividend for seven consecutive years
from the financial year 2018-19. Accordingly, as per
Section 124(6) of the Act and Rule 6(3)(a) of the Investor
Education and Protection Fund Authority (Accounting,
Audit , Transfer and Refund) Rules, 2016 ("IEPF Rules”),
the Company has transferred 1784 equity shares held by
4 shareholders to IEPF Authority on 14^th May, 2026.

Members who have not yet received/claimed their
dividend entitlements are requested to contact the
Company or the RTA of the Company. Members can claim
from IEPF Authority their dividend entitlements and/
or shares transferred to IEPF by following the required
procedure and on submission of such documents as
prescribed under the IEPF Rules.

30. PARTICULARS OF LOANS, GUARANTEES
OR INVESTMENTS

The Company has disclosed the particulars of the loans
given, investments made or guarantees given or security
provided during the year, as required under Section
186 of the Companies Act, 2013, Regulation 34(3)
and Schedule V of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, in Notes
forming part of the financial statements

31. PARTICULARS OF CONTRACTS OR
ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered
into by the Company during the year under review with
related parties were in the ordinary course of business
and on an arm's length basis. The Audit Committee
has reviewed and approved the said related party
transactions during the FY 2025-26 as required under
the law. There were no Related Party Transactions that
have any conflict of interest.

Details of contracts/ arrangements/ transactions with
related parties, as required to be disclosed in Form
No. AOC-2 pursuant to Section 134(3)(h) read with
Section 188 of the Companies Act, 2013 and Rule 8(2)
of the Companies (Accounts) Rules, 2014, are annexed
herewith in "Annexure V" to the Board's Report.

The Company has obtained prior omnibus approval for
related party transactions which were of repetitive nature
and entered in the ordinary course of business and on an
arm's length basis. There were no materially significant
related party transactions which could have potential
conflict with the interest of the Company at large.

A statement giving details of all related party
transactions, is placed before the Audit Committee for
review on a quarterly basis.

The details of transactions/contracts/arrangements
entered into by the Company with Related Parties during
the year under review are set out in the Note. 35 of the
Standalone Financial Statements and Note. 34 of the
Consolidated Financial Statements, respectively forming
part of this Annual Report.

The Company's Policy on dealing with Related Party
Transactions, as approved by the Board, is available on
the website of the Company at the link:https://afcons.
com/corporate-aovernance/#policies.

32. ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) and Section
92 (3) of the Act read with the Companies (Management
and Administration) Rules, 2014, the Annual Return of
the Company as on 31^st March, 2026 in Form MGT - 7,
is available on the website of the Company athttps://
afcons.com/financials/#annual-reports-related.The
Annual Return for the financial year ended 31^st March,
2026 shall be filed with the Ministry of Corporate Affairs
within the prescribed period.

33. VIGIL MECHANISM

The Company has a Whistle-blower Policy in place which
aligns with the requirements of vigil mechanism under
the Act and Regulation 22 of SEBI Listing Regulations.
This Policy provides for adequate safeguards against
victimization of persons who complain under the
mechanism and provides for direct access to the
Chairperson of the Audit Committee. The Audit
Committee of the Company oversees the functioning of
the Vigil Mechanism framework.

The Policy also facilitates direct access to
the Chairperson of the Audit Committee.

The Policy can be accessed on the Company's website at
https://afcons.eom/corporate-aovernance/#policies.

34. RISK MANAGEMENT

The Company is a global infrastructure Company
majorly engaged in Engineering, Procurement and
Construction business and is exposed to various risks
in the areas it operates. In a fast changing and dynamic
business environment, the risk of geo-political and
economic uncertainties, commodity price variation and
currency fluctuation, interest rate fluctuation and cyber
threats have increased manifold. The Company's Risk
Management Policy outlines guidelines in identification,
assessment, measurement, monitoring, mitigating and
reporting of key business risks associated with the
activities conducted. The risk management mechanism
forms an integral part of the business planning and
review cycle of the Company. The Company has
formulated and implemented a Risk Management Policy
which is available on the website of the Company at
https://afcons.com/corporate-aovernance/#policies.
The policy is designed to provide reasonable
assurance towards achievement of its goals by
integrating management control into daily operations,
ensuring compliance with legal and safeguarding the
integrity of the Company's financial reporting and the
related disclosures.

The Company has a mechanism in place to inform the
Risk Management Committee and the Board members
about risk assessment, minimisation procedures
and periodical review thereof. The Risk Management
Committee of the Company inter alia reviews Risk
Management functions of the Company and ensures
appropriate methodology, processes and systems are in
place to monitor and evaluate risks associated with the
business of the Company.

The Committee periodically validates, evaluates and
monitors key risks and reviews the measures taken

for risk management and mitigation. The key business
risks faced by the Company and the various mitigation
measures taken by the Company are detailed in the
Management Discussion and Analysis section which
forms a part of this Annual Report.

35. PROTECTION OF WOMEN AT WORKPLACE

The Company provides an equal employment opportunity
and is committed for creating a healthy working
environment that enables employees to work without
fear of prejudice, gender bias and sexual harassment.
The Company also believes that all employees of the
Company have the right to be treated with dignity.

The Company is committed to providing safe and
respectful work environment and enforces zero
tolerance approach towards any conduct which can
be considered as sexual harassment at workplace.
The Company has adopted a policy on "Prevention of
Sexual Harassment at Workplace (POSH)” as per the
provisions of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act,
2013 and the Rules thereunder ("POSH Act & Rules”).
All employees (permanent, contractual, temporary,
trainees) are covered under this policy, and the policy
is gender neutral. An Internal Complaints Committee
has also been set up to ensure implementation and
compliance with the provisions of the POSH Act &
Rules. The Company periodically conducts sessions for
employees across the organisation to build awareness
about the Policy and the provisions of POSH Act & Rules.
The Policy is uploaded on the Company's website at
https://afcons.com/corporate-aovernance/#policies

The necessary disclosure in terms of requirements of
SEBI Listing Regulations in this regard is given below:

a. No. of complaints filed during FY 2025-26 : NIL

b. No. of complaints disposed off during
FY 2025-26 : NIL

c. No. of complaints pending as on end of
FY 2025-26 : NIL

36. COMPLIANCE WITH THE PROVISIONS
RELATING TO THE MATERNITY BENEFIT ACT
1961

The Company complies with the provisions of
the Maternity Benefit Act, 1961, and provides
maternity benefits to eligible women employees.
Adequate facilities and support are provided in line with
statutory requirements.

37. EMPLOYEE STOCK OPTIONS SCHEME

The Company recognises the importance of long-term
equity-based incentives for its employees as a
lever to attract, motivate, and retain top-tier talent.
Employee stock options ("ESOPs” or "Options”) not only
reward performance but also cultivate a deep sense
of ownership and accountability, aligning employee
interests with those of Members and reinforcing
the Company's long-term objectives. In view of the
Company's evolving strategic priorities and talent
retention needs, the Company and in accordance with
the provisions of the Act and the Rules thereunder
and the Securities and Exchange Board of India
(Share Based Employee Benefits and Sweat Equity)
Regulations, 2021 ("SEBI SBEB Regulations”) and based
on the recommendation of the NRC and Board at their
respective meetings held on 24^th September,2025 and
25^th September, 2025 and the approval of member
obtained through postal ballot held on 10^th November,
2025, the Company has introduced Employee Stock
option Scheme named as "Afcons Infrastructure Limited
- Employee Stock Option Plan 2025” ("ESOP 2025”
or "ESOP Plan”) comprising a pool of not exceeding
1,83,89,232 (One Crore Eighty-Three Lakh Eighty-Nine
Thousand Two-Hundred and Thirty-Two Only) Options
to the eligible employees of the Company, its subsidiary
company(ies) and associate company(ies), to subscribe
to the equity shares of the Company underlying the
Options at the exercise price to be determined by
the Committee in accordance with the ESOP 2025.
Any Option granted under the ESOP 2025 to the eligible
employees of the Company would vest not earlier than
the minimum vesting period of 1 (one) year and not later
than maximum vesting period of 5 (five) years from the
date of grant. The vesting of Options for each eligible
employee for each year would be based on achievement
of mandatory pre-defined performance criteria in
the preceding financial year which shall consist of a
combination of both Individual (i.e. option grantee's)
performance and Company performance parameters as
specified in grant letter.

The ESOP 2025 is administered by the NRC who shall
have all necessary powers as defined in the ESOP
2025 and is hereby designated as the Compensation
Committee in pursuance of the SEBI SBEB Regulations
for the purpose of administration and superintendence
of the ESOP 2025.The Committee may further delegate
its power to administer the Scheme to Head - Human
Resource or Company Secretary of the Company
or such other persons as may be determined by the
Committee from time to time, as permissible under the
Applicable Laws.

During the year under review, against the ESOP pool of
1,83,89,232 Options, the NRC has granted an aggregate
of 1,02,81,931 ESOPs in 2 tranches to identified eligible
employee(s) of the Company as detailed below :

a. 1,01,71,230 (One Crore One Lakh Seventy One
Thousand Two Hundred Thirty) Options granted
on 12^th December, 2025 at an exercise price of
' 321/- per Options.

b. 1,10,701 (One Lakh Ten Thousand Seven Hundred
One) Options granted on 4^th February, 2026 at an
exercise price of ' 271/- per shares.

A disclosure related to ESOP as at 31^st March, 2026,
required to be made under the Act and and Rules
thereunder and under Regulation 14 of SEBI SBEB
Regulations, and Rule 12(9) of Companies (Share Capital
and Debentures) Rules, 2014 is provided on the website
of the Company and can be accessed athttps://afcons.
com/financials/#annual-reports-related

A certificate obtained from the Secretarial Auditors,
confirming that the ESOP Scheme of the Company is
in compliance with the SEBI SBEB Regulations and that
the Company has complied with the provisions of the
Companies Act, 2013, is provided on the website of the
Company and can be accessed at https://afcons. com/
financials/#annual-reports-related

38. OTHER DISCLOSURES/REPORTING

a) No disclosure or reporting is required in respect of
the following items as there were no transactions
on these items during the year under review:

• Issue of equity shares with differential rights
as to dividend, voting or otherwise.

• Buyback of shares.

• Scheme of provision of money for the purchase
of Company's own shares by employees or by
trustees for the benefit of employees.

• Issue of shares (including sweat equity
shares) to employees of the Company
under any scheme.

• Neither the Managing Director nor the Whole¬
Time Directors of the Company receive any
remuneration or commission from any of
its subsidiaries.

b) During the year under review, there is no change in
the business activity of the Company.

c) There has been no material changes and
commitments 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 this Report.

d) During the year under review, no application was
made or any proceeding pending against the
Company under the Insolvency and Bankruptcy
Code, 2016 (IBC Code).

e) During the year under review, there has been no
instance of one time settlement with Banks or
financial institutions, hence the disclosure relating
to the details of difference between amount of the
valuation done at the time of one time settlement
and the valuation done while taking loan from
the banks or financial institutions along with the
reasons thereof is not applicable.

f) The Company has registered itself on Trade
Receivables Discounting System platform (TReDS)
through the service providers Receivables Exchange
of India Limited and M1exchange. The Company
complies with the requirement of submitting a
half yearly return (Form MSME-I) to the Ministry of
Corporate Affairs within the prescribed timelines.

9. NODAL OFFICER

The Company has appointed Mr. Gaurang Parekh,

Company Secretary as the Nodal Officer for the purpose

of verification of claims filed with the IEPF Authority in

terms of IEPF Rules and for co-ordination with the IEPF
Authority. The said details are also available on the
website of the Companyhttps://afcons.com/contact-us/

40. SIGNIFICANT AND MATERIAL ORDERS

During the year under review, no significant / material
orders were passed / received by the regulators or the
Courts or the Tribunals impacting the going concern
status and the Company's operations in future.

41. SERVICE OF DOCUMENTS THROUGH
ELECTRONIC MEANS

Subject to the applicable provisions of the Act, and
applicable law, all documents, including the Notice
and Annual Report shall be sent through electronic
transmission in respect of members whose email IDs
are registered in their demat account or are otherwise
provided by the Members. A Member shall be entitled to
request for physical copy of any such documents.

42. ACKNOWLEDGEMENT

Your Directors take this opportunity to thank all the
government and regulatory authorities, Financial
Institutions, Banks , Investors, Customers, JV Partners,
Consortium Partners, Vendors, Suppliers, Contractors,
Auditors and all other stakeholders for their valuable
continuous support.

The Directors wish to place on record its sincere
appreciation for the committed and loyal services
rendered by the Company's executives, staff and workers.
Your Directors also would like to particularly thank and
place on record their gratitude to all the Members of
the Company for their faith in the management and
continued affiliation with the Company.

For and on behalf of the Board of Directors of
Afcons Infrastructure Limited

Subramanian Krishnamurthy Srinivasan Paramasivan

Place: Mumbai Executive Chairman Managing Director

Date: 18^th May, 2026 DIN: 00047592 DIN: 00058445