DIRECTORS' REPORT

Your directors take pleasure in presenting the 36^th Annual Report and the Audited Financial Statements (Standalone
and Consolidated) for the Financial Year ended March 31,2026:

1. Financial Highlights

The Standalone and Consolidated performance for the Financial Year ended March 31,2026, is as under:

2. State of the Company's Affairs

Your Company recorded a turnover of ^22,135.23 lakhs and a total comprehensive income of ?2,234.96 lakhs
on a standalone basis for the financial year ended March 31, 2026, as compared to ^24,848.36 lakhs and
?5,956.56 lakhs respectively in the previous year.

On a consolidated basis, the Company recorded a turnover of ^22,287.24 lakhs and a total comprehensive
income of ?1,484.36 lakhs as against ^24,912.62 lakhs and ?5,609.48 lakhs respectively in the previous year.

3. Transfer to Reserves

The Board of Directors has decided not to transfer any amount to the General Reserve for the financial year
ended March 31,2026

4. Dividend

The Board of Directors has recommended a final dividend of Re. 0.20/- per equity share of ?2/- (Rupees Two
only) each, fully paid-up, for the financial year 2025-26.

The dividend, if approved by the members at the ensuing Annual General Meeting, will be paid subject to
deduction of income tax at source. The dividend shall be paid to those members whose names appear in the
Register of Members as on the record date (i.e., June 12, 2026). In respect of shares held in dematerialized
form, the dividend will be paid to the beneficial owners as per the details furnished by National Securities
Depository Limited and Central Depository Services (India) Limited as on the record date. The dividend pay¬
out is in accordance with the Company’s Dividend Distribution Policy.

5. Rights Issue and Utilisation of Proceeds

During the financial year under review, the Company had issued shares to all its existing shareholders on
Rights basis in terms of Section 62 and other applicable provisions of the Companies Act, 2013, SEBI (Issue of
Capital and Disclosure Requirements), 2018. The Company issued 2,02,26,100 equity shares of face value ?2
each at an issue price of ?40 per equity share (including a premium of ?38 per share), aggregating to ^80.91
Crores, to eligible equity shareholders in the ratio of 10 equity shares for every 121 equity shares held as on the
record date i.e., May 7, 2025. The Rights Issue opened on May 15, 2025, and closed on May 28, 2025, and the
shares were allotted on May 29, 2025.

The proceeds from the Rights Issue are being utilised towards establishment of new manufacturing facilities,
development of infrastructure, and for general corporate purposes, in line with the objects stated in the Letter
of Offer.

Utilisation of Rights Issue Proceeds

The utilisation of proceeds, as reviewed by the Monitoring Agency, CARE Ratings Limited, as on March 31,
2026, is as follows:

Pursuant to Regulation 32 ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015:

• The Company has utilised ?76.48 Crores out ofthe total proceeds of ?80.91 Crores as on March 31, 2026.

• The balance amount of ?4.43 Crores remains unutilised and is held in designated account, to be utilised in
subsequent periods for the stated objects of the issue as per the Letter of Offer.

• There has been no deviation or variation in the utilisation of proceeds from the objects stated in the Letter

of Offer.

The Audit Committee reviews the utilisation of proceeds on a periodic basis in compliance with applicable
regulatory requirements.

6. Listing of Equity Shares

The equity shares of the Company are listed on the following stock exchanges having nationwide trading
terminals:

(a) BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001, Maharashtra, India; and

(b) National Stock Exchange of India Limited, Exchange Plaza, Floor 5, Plot No. C/1, G Block, Bandra-
Kurla Complex, Bandra (East), Mumbai - 400051, Maharashtra, India.

The Company has paid the annual listing fees to the aforesaid stock exchanges for the financial year 2025-26.

7. Subsidiary Companies

During the year under review, the Company has one subsidiary, namely Imeds Global Private Limited, which
is a Wholly Owned Subsidiary ofthe Company.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, read with Rule 5 of the Companies
(Accounts) Rules, 2014, a statement containing the salient features of the financial statements ofthe subsidiary
company in Form AOC-1 is attached to this Board's Report as Annexure - 1.

8. Performance and contribution of each of the Subsidiaries, Associates and Joint Ventures

In accordance with the provisions of Rule 8 ofthe Companies (Accounts) Rules, 2014, a report on the financial
performance ofthe subsidiary company and its contribution to the overall performance of the Company for the
financial year ended March 31,2026, is provided in Annexure - 1 forming part of this Board's Report.

The Company does not have any associate or joint venture companies during the year under review.

9. Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2026, have
been prepared in accordance with the applicable Indian Accounting Standards (Ind AS) prescribed under
Section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules,
2015, and other applicable provisions of the Act. The Consolidated Financial Statements form an integral part
of this Annual Report.

In terms of the provisions of Section 136 of the Companies Act, 2013, the audited financial statements of the
subsidiary company are available on the Company's website and can be accessed at www.avantel.in. These
documents will also be made available for inspection by the shareholders upon request.

10. Share Capital

The Authorized Share Capital of the Company as of March 31, 2026, stood at ^60,00,00,000/- (Rupees Sixty
Crores only), divided into 30,00,00,000 (Thirty Crores) equity shares of ?2/- (Rupees Two only) each.

The issued, subscribed and paid-up equity share capital of the Company as of March 31, 2026, stood at
^53,14,21,700/- (Rupees Fifty-Three Crores Fourteen Lakhs Twenty-One Thousand Seven Hundred only),
divided into 26,57,10,850 equity shares of ?2/- each, fully paid-up.

During the year under review, the paid-up share capital of the Company increased pursuant to the exercise of

7.48.930 Employee Stock Option Plan (ESOP) grants by eligible employees, resulting in the allotment of

7.48.930 equity shares of ?2/- each.

Further, during the year under review, the Rights Issue Committee of the Board of Directors ofAvantel Limited
(“the Company”), at its meeting held on May 29, 2025, approved the allotment of2,02,26,100 equity shares of
face value of ?2/- each on a rights basis to the eligible equity shareholders. The said equity shares were issued at
a price of ?40/- per equity share, including a premium of ?38/- per equity share.

The equity shares so allotted under ESOP and Rights Issue rank pari passu in all respects with the existing
equity shares of the Company.

11. Variations in Net worth

The standalone net worth of the Company as of March 31, 2026, stood at ? 35,650.45 lakhs as compared to ?
24,801.16 lakhs as of March 31,2025. The consolidated net worth of the Company as of March 31,2026, stood
at ? 33,823.30 lakhs as compared to ? 23,724.61 lakhs as of March 31,2025.

12. Directors

During the financial year under review, Mrs. Mini Ipe (DIN: 07791184), Independent Director ofthe Company
has resigned from the Board with effect from February 21, 2026, due to her preoccupation and certain
unforeseen personal commitments.

The Company has received confirmation from Mrs. Mini Ipe that there are no material reasons for her
resignation other than those stated in her resignation letter and that there are no material concerns relating to
the management or affairs ofthe Company.

Apart from the above, there were no other changes in the composition of the Board of Directors during the
financial year ended March 31,2026.

Post the close ofthe financial year, the Board of Directors at its meeting held on April 26, 2026, appointed:

a) Dr. Tamilmani Kandasamy as an Additional Director (Independent); and

b) Mr. Lakshminarasimha Acharyulu Muktevi as an Additional Director (Independent),
subject to the approval ofthe Members at the ensuing Annual General Meeting.

13. Key Managerial Personnel

Pursuant to the provisions of Sections 2(51) and 203 of the Companies Act, 2013, read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following officials are designated
as Key Managerial Personnel ofthe Company:

Dr. Abburi Vidyasagar - Managing Director

Mrs. Abburi Sarada - Whole-time Director & Chief Financial Officer

Mr. Abburi Siddhartha Sagar - Whole-Time Director

Mr. D. Rajasekhara Reddy - Company Secretary & Compliance Officer

14. Number of Meetings of the Board of Directors

During the financial year ended March 31, 2026, five (5) meetings of the Board of Directors were held on April
26, 2025, May 1,2025, July 25, 2025, October 18, 2025, and January 25, 2026.

The gap between two consecutive meetings did not exceed 120 days, and the meetings were conducted in
compliance with the applicable provisions of the Companies Act, 2013 and Secretarial Standards. The
requisite quorum was present at all the meetings.

The attendance of the Directors at the Board Meetings held during the year are as follows:

Note: * Mrs. Mini Ipe (DIN: 07791184), Independent Director, resigned from the Board with effect from February
21,2026.

15. Particulars of Loans, Guarantees, Securities or Investments under Section 186

The particulars of loans given, guarantees provided, securities given and investments made during the
financial year ended March 31, 2026, in compliance with the provisions of Section 186 of the Companies Act,
2013, read with the Companies (Meetings of Board and its Powers) Rules, 2014, are provided in Annexure - 2
forming part ofthis Board's Report.

16. Particulars of Contracts or Arrangements with Related Parties

All related party transactions entered into during the financial year were in the ordinary course of business and
on an arm's length basis. There were no materially significant related party transactions entered into by the
Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have
a potential conflict with the interests of the Company at large.

All related party transactions were placed before the Audit Committee for approval and were also approved by
the Board of Directors, wherever required.

The Company has in place a Policy on Related Party Transactions for the purpose of identification, monitoring
and approval of such transactions. The said policy is available on the website of the Company and can be
accessed at: www.avantel.in/investors.

The particulars of contracts or arrangements with related parties referred to in Section 188(1) ofthe Companies
Act, 2013, in the prescribed Form AOC-2, are provided in Annexure - 3 forming part ofthis Board's Report.

17. Annual Return

Pursuant to the provisions of Section 92(3) of the Companies Act, 2013 and the rules made thereunder, the
Annual Return ofthe Company in Form MGT-7 for the financial year ended March 31,2026, is available on the
website ofthe Company and can be accessed at: www.avantel.in/investors.

18. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and
outgo, as required under Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts)
Rules, 2014, is provided in Annexure - 4 forming part ofthis Board's Report.

19. Audit Committee

During the financial year ended March 31, 2026, four (4) meetings of the Audit Committee were held on April
26, 2025, July 25, 2025, October 18, 2025, and January 25, 2026.

The gap between any two consecutive meetings did not exceed one hundred and twenty days, in compliance
with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015.

During the year under review, all the recommendations made by the Audit Committee were accepted by the
Board of Directors.

The composition of the Committee and attendance at its meetings are as follows:

20. Nomination and Remuneration Committee
V Brief description of the terms of reference:

The Nomination and Remuneration Committee (“NRC”) functions in accordance with the provisions of the
Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The key terms of reference for the Committee include:

• formulation of the criteria for determining qualifications, positive attributes and independence of a director
and recommend to the board of directors a policy relating to the remuneration of the directors, key
managerial personnel and other employees.

• for every appointment of an Independent Director, the Nomination and Remuneration Committee shall
evaluate the balance of skills, knowledge and experience on the Board and on the basis of such evaluation,
prepare a description of the role and capabilities required of an Independent Director. The person
recommended to the Board for appointment as an Independent Director shall have the capabilities
identified in such description. For the purpose of identifying suitable candidates, the Committee may:

a) use the services of an external agencies, if required;

b) consider candidates from a wide range of backgrounds, having due regard to diversity; and

c) consider the time commitments of the candidates.

• formulation of criteria for evaluation of performance of Independent Directors and the board of directors;

• devising a policy on diversity of board of directors;

• identifying persons who are qualified to become directors and who may be appointed in senior
management in accordance with the criteria laid down and recommend to the board of directors their
appointment and removal.

• whether to extend or continue the term of appointment of the independent director, on the basis of the report
of performance evaluation of independent directors.

• recommend to the board, all remuneration, in whatever form, payable to senior management.

Meetings of the Committee

During the financial year ended March 31,2026, two (2) meetings of the Nomination and Remuneration Committee
were held on April 26, 2025, and January 25, 2026.

The composition ofthe Committee and attendance at its meetings are as follows:

21. Corporate Social Responsibility (CSR)

The Company is committed to improving the quality of life of the communities in which it operates. In line
with its philosophy of “looking beyond business,” the Company endeavors to create a sustainable and positive
impact on society and the environment. The Company believes in balancing its pursuit of corporate excellence
with its social responsibilities.

Pursuant to the provisions of Section 135 read with Schedule VII of the Companies Act, 2013, the Corporate
Social Responsibility (CSR) Committee has formulated a CSR Policy, and the same is being implemented by
the Company. The details of CSR activities undertaken during the financial year are provided in Annexure - 5,
forming part ofthis Report.

During the financial year 2025-26, the Company was required to spend an amount of ^1,30,21,041/- towards
CSR activities. The Company has spent ^1,30,49,556/-, which is in excess of the statutory requirement. The
excess amount spent over and above the statutory requirement shall be set off against CSR obligations of
subsequent financial years, in accordance with applicable provisions.

During the year under review, one (1) meeting ofthe CSR Committee was held on April 26, 2026.

The composition ofthe Committee and attendance at its meetings are as follows:

Note: * Mrs. Mini Ipe (DIN: 07791184), Independent Director, resigned from the Board with effect from February
21,2026.

22. Stakeholders Relationship Committee

Terms of Reference

( i ) Resolving the grievances of the security holders including complaints related to transfer/transmission of
shares, non-receipt of annual report, non-receipt of declared dividends, non-receipt of new/duplicate
certificates, etc.

(ii) Review ofmeasures taken for effective exercise ofvoting rights by shareholders.

(iii) Review of adherence to the service standards adopted by the Company in respect of various services
being rendered by the Registrar & Share Transfer Agent.

(iv) Review of the various measures and initiatives taken by the Company for reducing the quantum of
unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices
by the shareholders ofthe Company.

Meetings of the Committee

During the year, one Meeting of the Stakeholders Relationship Committee was held on January 25, 2026.

The composition of the Committee and attendance at its meetings are as follows:

Note: * Mrs. Mini Ipe (DIN: 07791184), Independent Director, resigned from the Board with effect from
February 21,2026.

23. Risk Management Committee

The Company has in place a robust Risk Management framework for identifying, evaluating and mitigating
various risks associated with its operations. The Risk Management Committee has formulated a Risk
Management Policy which outlines the procedures for risk identification, assessment, monitoring and
mitigation.

The Company has adequate internal control systems and procedures to effectively manage risks. The risk
management processes are periodically reviewed by the Audit Committee and the Board of Directors,
including during the review of quarterly financial results.

Brief description of terms of reference

1. To formulate a detailed Risk Management Policy which shall include:

a) A framework for identification of internal and external risks specifically faced by the Company, in
particular including financial, operational, sectoral, sustainability (particularly, Environment, Social
and Governance related risks), information, cyber security risks or any other risk as may be determined
by the Committee.

b) Measures for risk mitigation including systems and processes for internal control of identified risks.

c) Business continuity plan.

2. To ensure that appropriate methodology, processes and systems are in place to monitor and evaluate risks
associated with the business of the Company;

3. To monitor and oversee implementation of the risk management policy, including evaluating the adequacy
ofrisk management systems;

4. To periodically review the risk management policy, at least once in two years, including by considering the
changing industry dynamics and evolving complexity;

5. To keep the board of directors informed about the nature and content of its discussions, recommendations
and actions to be taken;

6. The appointment, removal and terms of remuneration of the Chief Risk Officer (if any) shall be subject to
review by the Risk Management Committee;

7. The Risk Management Committee shall coordinate its activities with other committees, in instances where
there is any overlap with activities of such committees, as per the framework laid down by the board of
directors.

Meetings of the Committee

During the financial year ended March 31,2026, two (2) meetings ofthe Risk Management Committee were held on

October 18, 2025, and January 25, 2026.

Composition ofthe Committee and Attendance at Meetings are as follows:

24. ESOP Allotment Committee

During the financial year ended March 31, 2026, five (5) meetings of the ESOP Allotment Committee were
held on July 1, 2025, August 19, 2025, December 22, 2025, January 28, 2026, and February 27, 2026.

Composition of the Committee and Attendance at Meetings are as follows:

25. Mechanism for Evaluation of the Board

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance and

that of its committees as well as performance of the Directors individually. Feedback was sought by way of a
structured questionnaire covering various aspects of the Board's functioning such as adequacy of the
composition of the Board and its Committees, Board culture, execution and performance of specific duties,
obligations and governance and the evaluation was carried out based on responses received from the Directors.

The evaluation is performed by the Board, Nomination and Remuneration Committee and Independent
Directors with specific focus on the performance and effective functioning of the Board and Individual
Directors.

In line with SEBI Circular No. SEBI/HO/CFD/CMD/CIR/P/2017/004, dated January 5, 2017, the Company
has adopted the criteria recommended by the SEBI.

The Directors were given Five Forms for evaluation ofthe following:

(i) Evaluation of Board;

(ii) Evaluation of Committees ofthe Board;

(iii) Evaluation of Independent Directors;

(iv) Evaluation of Managing Director and Executive Directors; and

(v) Evaluation of Chairman.

The Directors were requested to give following ratings for each criterion:

1. Could do more to meet expectations;

2. Meets expectations; and

3. Exceeds expectations.

The Chairperson, based on the Evaluation done by the Directors, informed that the performance is effective
and aligned with the Company's strategic objectives, and they are recommended for continuation as Directors
of the Company.

26. Management Discussion and Analysis

The Management Discussion and Analysis, as required under the Listing Regulations, forms an integral part of
this Report.

27. Directors' Responsibility Statement as required under Section 134 of the Companies Act, 2013

Pursuant to the requirement under Section 134 of the Companies Act, 2013, with respect to the Directors'
Responsibility Statement, the Board of Directors ofthe Company hereby confirms:

i) that in the preparation of the Annual Accounts, the applicable accounting standards have been followed;

ii) that the Directors have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of
affairs of the Company as on March 31, 2026, and of Profit and Loss Account of the Company for that
period;

iii) that the Directors have 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;

iv) that the Directors have prepared the Annual Accounts for the Financial Year ended March 31, 2026, on a
going concern basis;

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

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

28. Statement on Declaration given by Independent Directors under Section 149

The Independent Directors have submitted a declaration of independence, as required pursuant to sub-section
(7) of Section 149 ofthe Companies Act, 2013 stating that they meet the criteria of independence as provided in
sub-section (6) of Section 149.

29. Familiarization programmes imparted to Independent Directors

The Members of the Board of the Company have been provided with opportunities to familiarize themselves
with the Company, its Management and its operations. The Directors are provided with all the documents to
enable them to have a better understanding of the Company, its various operations and the industry in which it
operates.

All the Independent Directors of the Company are made aware of their roles and responsibilities at the time of
their appointment through a formal letter of appointment, which also stipulates various terms and conditions of
their engagement.

Executive Directors and Senior Management provide an overview of the operations and familiarize the new
Non-Executive Directors with matters related to the Company's values and commitments. They are also
introduced to the organization structure, constitution of various committees, board procedures, risk
management strategies, etc.

Strategic presentations are made to the Board where Directors get an opportunity to interact with Senior
Management. Directors are also informed of the various developments in the Company through Press
Releases, emails, etc.

Senior management personnel of the Company make presentations to the Board Members on a periodical
basis, briefing them on the operations ofthe Company, plans, strategy, risks involved, new initiatives, etc., and
seek their opinions and suggestions on the same. In addition, the Directors are briefed on their specific
responsibilities and duties that may arise from time to time.

The Statutory Auditors and Internal Auditors of the Company make presentations to the Board of Directors on
Financial Statements and Internal Controls. They will also make presentations on regulatory changes from
time to time.

The details ofthe familiarisation programme are available on the website: www.avantel.in/investors.

30. Meeting of Independent Directors

A separate meeting of the Independent Directors was held under the Chairmanship of Mr. Vyasabhattu
Ramchander, Independent Director on January 25, 2026, inter-alia, to discuss evaluation of the performance of
the Board as a whole, evaluation of the performance of the Chairman, taking into account the views of the
Executive and the evaluation of the quality, content and timeliness of flow of information between the
management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of the Directors and the Board
as a whole.

31. Registration of Independent Directors in Independent Directors Data bank

All the Independent Directors of your Company have been registered and are members of Independent
Directors Databank maintained by the Indian Institute of Corporate Affairs (IICA).

32. Online Proficiency Self-Assessment Test

Mr. Ramchander Vyasabhattu, Independent Director of the Company, has successfully passed the Online
Proficiency Self-Assessment Test conducted by the Indian Institute of Corporate Affairs.

Further, Mr. Myneni Narayana Rao, Mr. Ajit Tavanappa Kalghatgi, Ms. Harita Vasireddi, Mr. Tamilmani
Kandasamy and Mr. M. L. N. Acharyulu, Independent Directors of the Company, are exempt from the
requirement of passing the said test, in terms of the applicable provisions of the Companies Act 2013 and the
relevant rules made thereunder, considering their extensive experience and expertise.

33. Confirmation and Opinion of the Board on Independent Directors

All the Independent Directors of the Company have given their respective declaration/ disclosures under
Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations and have confirmed that they fulfill
the independence criteria as specified under section 149(6) of the Act and Regulation 16 of the Listing
Regulations and have also confirmed that they are not aware of any circumstance or situation, which exist or
may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an
objective independent judgment and without any external influence. Further, the Board, after taking these
declarations/disclosures on record and acknowledging the veracity of the same, concluded that the
Independent Directors are persons of integrity and possess the relevant expertise and experience to qualify as
Independent Directors ofthe Company and are Independent ofthe Management.

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity,
possesses requisite expertise, experience and qualifications to discharge the assigned duties and
responsibilities as mandated by the Companies Act, 2013 and Listing Regulations diligently.

34. Board Diversity

The Company has over the years been fortunate to have eminent people from diverse fields to serve as
Directors on its Board. Pursuant to the SEBI Listing Regulations, the Nomination & Remuneration Committee
of the Board ensured diversity of the Board in terms of experience, knowledge, perspective, background,
gender, age and culture.

35. Statement of particulars of appointment and remuneration of managerial personnel

Disclosures pertaining to remuneration and other details as required under Section 197(12) ofthe Act read with
Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed
to this Board's Report as Annexure - 6.

36. Directors and Officers Insurance ('D&O')

As per the requirements of Regulation 25(10) of the SEBI Listing Regulations, the Company has taken
Directors and Officers Insurance (D&O) for all its directors and members of Senior Management.

37. Code of Conduct

The Board of Directors has adopted and oversee the administration of the Avantel Limited Code of Business
Conduct and Ethics (the 'Code of Conduct'), which applies to all Directors, Officers and Employees of Avantel
Limited and its subsidiaries. The Code of Conduct reflects the Company's commitment to doing business with
integrity and in full compliance with the law and provides a general roadmap for all the Directors, Officers and

Employees to follow as they perform their day-to-day responsibilities with the highest ethical standards. The
Code of Conduct also ensures that all members of Avantel Limited and its subsidiaries perform their duties in
compliance with applicable laws and in a manner that is respectful of each other and the Company's
relationships with its customers, suppliers and shareholders, as well as the communities and regulatory bodies
where the Company does business.

38. Deposits

The Company has not accepted any deposits from the public in terms of Chapter V ofthe Companies Act, 2013.
Hence, no amount on account of principal or interest in public deposits was outstanding as on the date of the
balance sheet.

39. Statutory Auditors

M/s. Grandhy & Co., Chartered Accountants (ICAI Firm Registration No. 001007S), were appointed as the
Statutory Auditors of the Company at the 31st Annual General Meeting held on June 5, 2021, for a term of five
(5) consecutive years, to hold office till the conclusion of the 36th Annual General Meeting of the Company to
be held in the year 2026.

The term of M/s. Grandhy & Co., Chartered Accountants, as Statutory Auditors of the Company, will conclude
at the ensuing 36th Annual General Meeting.

Based on the recommendation of the Audit Committee, the Board of Directors has proposed the appointment
of M/s. Grandhy & Co., Chartered Accountants (ICAI Firm Registration No. 001007S), as Statutory Auditors
of the Company for a second term of five (5) consecutive years, to hold office from the conclusion of the 36th
Annual General Meeting till the conclusion of the 41st Annual General Meeting of the Company, subject to the
approval of the members.

The Company has received a written consent and certificate from M/s. Grandhy & Co., Chartered
Accountants, to the effect that their appointment, if made, shall be in accordance with the provisions of Section
139 and Section 141 of the Companies Act, 2013 and that they are not disqualified from being appointed as
Statutory Auditors ofthe Company.

40. Auditors Report

The Statutory Auditors, M/s. Grandhy & Co., Chartered Accountants (ICAI Firm Registration No. 001007S),
have issued their report on the financial statements of the Company for the financial year ended March 31,
2026.

The Auditors' Report for the financial year ended March 31, 2026, does not contain any qualification,
reservation, adverse remark or disclaimer.

41. SecretarialAuditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, M/s. P. S. Rao & Associates, Company
Secretaries in Practice, were appointed as Secretarial Auditors of the Company at the previous Annual General
Meeting for a term of five (5) consecutive years, to hold office up to the conclusion of the 40th Annual General
Meeting of the Company to be held in the year 2030.

The Secretarial Audit Report for the financial year ended March 31, 2026, issued by M/s. P. S. Rao &
Associates, does not contain any qualification, reservation or adverse remark and forms part of this Board's
Report as Annexure - 7.

However, the Secretarial Auditors have made the following observation:

• The Company had not provided prior intimation to the Stock Exchanges in respect of the Board Meeting

held on May 1, 2025, as required under Regulation 29(2) ofthe SEBI Listing Regulations.

The Board of Directors has taken note of the above observation. The delay was unintentional and occurred due
to administrative oversight. Subsequently, the Company has strengthened its internal compliance monitoring
mechanism and implemented necessary control measures to ensure timely compliance with all applicable
regulatory requirements.

Further, the Secretarial Auditors have confirmed that no instances of fraud have been reported under Section
143(12) ofthe Companies Act, 2013 during the year under review.

42. Internal Auditors

Pursuant to the provisions of Section 138 of the Companies Act, 2013 and the rules made thereunder, the Board
of Directors has appointed M/s. Ramesh & Co., Chartered Accountants (Firm Registration No. 002979S), as
Internal Auditors ofthe Company for the financial year ending March 31,2027.

The Internal Auditors conduct periodic audits of the Company's internal control systems and processes, and
their reports are reviewed by the Audit Committee from time to time. The reports of the Internal Auditors are
reviewed by the Audit Committee from time to time.

43. Cost Audit and Maintenance of Cost Records specified by the Central Government under Section 148 of
the Companies Act, 2013

In accordance with the provisions of Section 148 of the Companies Act, 2013, read with the Companies (Audit
and Auditors) Rules, 2014, the Board of Directors, on the recommendation of the Audit Committee, has
appointed M/s. MPR & Associates, Cost Accountants (Firm Registration No. 000413), Hyderabad, as Cost
Auditors of the Company to conduct the audit of the cost records for the financial year ending March 31,2027,
at a remuneration of ?1,50,000/-

The remuneration payable to the Cost Auditors is required to be ratified by the members at the ensuing Annual
General Meeting. Accordingly, a resolution seeking ratification of the said remuneration forms part of the
Notice convening the Annual General Meeting.

The Company is maintaining cost records as specified by the Central Government under Section 148(1) of the
Companies Act, 2013.

The Company has received a certificate from M/s. MPR & Associates, Cost Accountants, confirming that their
appointment, if made, would be within the limits prescribed under Section 141 ofthe Companies Act, 2013 and
the rules made thereunder, and that they are not disqualified to be appointed as Cost Auditors.

The Cost Audit Report for the financial year ended March 31, 2026, issued by the Cost Auditors does not
contain any qualification, reservation or adverse remark. The Company shall file the same with the Central
Government within the prescribed time.

44. Board's Response to Auditors' Qualifications, Reservations or Adverse Remarks

There are no qualifications, reservations, adverse remarks or disclaimers made by the Statutory Auditors in
their Audit Report or by the Cost Auditors in the Cost Audit Report.

However, the Secretarial Auditor, in the Secretarial Audit Report, has made the following observation:
i. The Company had failed to make a prior intimation ofthe Board meeting held on 1st May 2025.

Boards' response to observations of Secretarial Audit Report are as follows:

The Board has noted the observation and clarified that the delay in prior intimation of the Board Meeting was

inadvertent and due to administrative reasons. The Company has since strengthened its compliance framework
to ensure timely adherence to the SEBI (LODR) Regulations, 2015, and the Board has advised the
management to ensure strict compliance with applicable regulatory timelines going forward.

45. Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, Internal Auditors, Secretarial Auditors and Cost Auditors
have not reported any instances of fraud committed in the Company by its Directors, Officers or Employees to
the Audit Committee under Section 143(12) of the Companies Act, 2013, which are required to be disclosed in
this Report.

46. Corporate Governance

The Company is committed to maintaining the highest standards of corporate governance and adheres to sound
governance practices with a view to ensuring transparency, accountability and protection of stakeholders'
interests.

A separate Report on Corporate Governance, along with a certificate from the Statutory Auditors of the
Company confirming compliance with the conditions of Corporate Governance as stipulated under Schedule
V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, forms an integral part ofthis Annual Report.

47. Vigil Mechanism (Whistle Blower Policy)

Pursuant to the provisions of the Companies Act, 2013 and the rules made thereunder, as well as the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a Vigil
Mechanism through its Whistle Blower Policy.

The Whistle Blower Policy provides a formal mechanism for Directors and employees of the Company to
report genuine concerns about unethical behavior, actual or suspected fraud, or violation of the Company's
Code of Conduct and Ethics. The mechanism ensures adequate safeguards against victimization of persons
who avail of the same and also provides for direct access to the Chairperson of the Audit Committee in
appropriate or exceptional cases.

It is hereby affirmed that no personnel of the Company have been denied access to the Audit Committee.

The Whistle Blower Policy is available on the Company's website and can be accessed at:
www.avantel.in/investors.

The Company is committed to conducting its affairs in a fair and transparent manner by adopting the highest
standards of professionalism, integrity and ethical behavior. The Whistle Blower Policy applies to all
employees ofthe Company.

48. Insurance

All properties and insurable interests of the Company have been adequately insured.

49. Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements,
commensurate with the size, scale and complexity of its operations.

The Corporate Governance policies of the Company clearly define the roles, responsibilities and authority at
each level of its governance structure. The Code of Conduct for Senior Management and employees reinforce
adherence to established financial and accounting policies, systems and processes. These policies are
communicated across the organization on a continuous basis.

The financial statements of the Company are prepared in accordance with the Indian Accounting Standards
(Ind AS) prescribed under Section 133 of the Companies Act, 2013, read with the Companies (Indian
Accounting Standards) Rules, 2015, as amended from time to time.

The Company maintains its books of accounts and records through an ERP system (SAP), wherein workflows
and approval mechanisms are system-driven to ensure transparency and control.

The Board of Directors has adopted various policies, including but not limited to Related Party Transactions
Policy, Whistle Blower Policy, Corporate Social Responsibility Policy, Policy on Determination and
Disclosure of Material Events, Document Preservation Policy, Code of Internal Procedures and Conduct for
Regulating, Monitoring and Reporting of Trading by Insiders, and Code of Practices and Procedures for Fair
Disclosure of Unpublished Price Sensitive Information, to ensure orderly and efficient conduct of its business,
safeguarding of assets, accuracy and completeness of accounting records, and timely preparation of reliable
financial information.

While internal financial controls are designed to provide reasonable assurance regarding the reliability of
financial reporting and preparation of financial statements, such controls have inherent limitations and may
not prevent or detect all misstatements. Accordingly, the Company undertakes periodic internal audits and
reviews to strengthen and improve the effectiveness of its internal control systems on an ongoing basis.

50. Names of Companies, which have become or ceased to be Company's Subsidiaries, Joint Ventures or
Associate Companies during the year

During the financial year under review, no company has become or ceased to be a subsidiary, joint venture or
associate of the Company.

51. Change in the nature of business

There has been no change in the nature of business of the Company during the financial year under review.

52. Material Orders Passed by Regulators or Courts or Tribunals

During the financial year under review, the following instances of non-compliance were observed:

• Delay in filing of Corporate Governance Report: Delay of one day in filing for the quarter ended June 30,
2015, under Regulation 27. A penalty of ?1,000/- was levied by BSE Limited and has been duly paid.

• Delay in prior intimation of Board Meeting: Non-compliance with Regulation 29(2) for the Board
Meeting held on May 1, 2025. Penalties of ?10,000/- each were levied by BSE Limited and National
Stock Exchange of India Limited and have been duly paid.

These instances were inadvertent and due to administrative oversight. The Company has strengthened its
internal controls to ensure strict compliance going forward.

The Board confirms that, except for the above, there were no significant or material orders passed by any
regulators, courts or tribunals during the financial year which would impact the going concern status of the
Company or its future operations.

53. Proceedings under the Insolvency and Bankruptcy Code, 2016 (31 of 2016)

During the financial year under review, no application was made and no proceedings were initiated or pending
against the Company under the Insolvency and Bankruptcy Code, 2016.

54. Material changes and commitments

There have been no material changes or commitments affecting the financial position of the Company that

have occurred at the end of the financial year to which the financial statements relate (i.e., March 31,2026) and
the date ofthis Report.

55. Employee Stock Options

Your Company firmly believes that its employees are the cornerstone of its sustained growth and long-term
value creation. In line with this philosophy, the Company has implemented structured equity-based incentive
mechanisms to align the interests of employees with those of shareholders and to foster a culture of ownership,
accountability and performance excellence.

During the year under review, the Company continued to operate the “Avantel Employees Stock Option Plan -
2023” (“ESOP 2023” or “Scheme”), which was approved by the Board of Directors at their meeting held on
October 9, 2023, and subsequently by the shareholders on November 11,2023.

The Scheme has been designed with a clear objective to reward employees for their continued association,
dedication and contribution, and to attract, retain and motivate high-calibre talent. It enables employees to
participate in the value they help create, thereby strengthening their engagement with the Company's long¬
term vision and growth trajectory.

The Scheme provides for grant of stock options not exceeding 45,00,000 equity shares of the Company. Each
option, upon exercise, is convertible into one equity share of ?2/- each, fully paid-up. The benefits derived by
employees are linked to the number of options exercised and the prevailing market price of the equity shares.

During the financial year, the paid-up share capital of the Company increased pursuant to the exercise of
7,48,930 stock options by eligible employees, resulting in the allotment of an equivalent number of equity
shares. Further, since the inception of the Scheme, employees have exercised 22,15,170 stock options,
reflecting strong participation and confidence in the Company's growth prospects.

The Company has recognized employee compensation expenses (share-based payments) in accordance with
applicable accounting standards. A provision of ? 679.35 lakhs has been made towards outstanding stock
options and employee compensation expenses for the financial year ended March 31, 2026, as disclosed in
Note No.29 to the standalone financial statements and Note No.28 to the consolidated financial statements.

The disclosures as required under Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014
are provided in Annexure - 8 to this Report. Further, the details of the Scheme as required under Section 62 of
the Companies Act, 2013 read with applicable rules and Part F of Schedule I of the SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021, are available on the Company's website at:
www.avantel.in.

The Company confirms that the Scheme is in compliance with the applicable provisions of the SEBI (Share
Based Employee Benefits and Sweat Equity) Regulations, 2021, and there were no material changes to the
Scheme during the year, except as stated below.

A certificate from M/s. P. S. Rao & Associates, Company Secretaries, confirming that the Scheme has been
implemented in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations,
2021, forms part ofthe Corporate Governance Report and is also available on the Company's website.

Further, the Board of Directors, at its meeting held on March 27, 2025, approved the introduction of a new
equity incentive scheme, namely “Avantel Employees Stock Option Plan - 2025 (ESOP 2025)”, which was
subsequently approved by the shareholders at the Annual General Meeting held on June 23, 2025.

The said scheme is aimed at further strengthening employee participation in the Company's future growth and
enhancing long-term stakeholder value. The Company is in the process of implementing and launching the
Scheme in accordance with applicable laws and regulatory requirements.

56. Business Responsibility and Sustainability Report

Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, the Business Responsibility and Sustainability Report (BRSR) of the Company for the financial year
ended March 31,2026, forms an integral part ofthis Annual Report and is annexed herewith as Annexure - 9.

57. Environment, Health and Safety

The Company is committed to conducting its operations in an environmentally responsible manner while
ensuring the health and safety of its employees and stakeholders. As part of its commitment to sustainable
practices and safe working conditions, the Company has implemented internationally recognized
management systems.

The Company is certified under the following standards:

ISO 14001:2015 - Environmental Management System (EMS): This standard specifies the requirements for
an environmental management system that enables the Company to systematically manage its environmental
responsibilities, improve environmental performance, and contribute to sustainable development.

ISO 45001:2018 - Occupational Health and Safety Management System (OH&S): This standard provides a
framework to ensure safe and healthy workplaces by preventing work-related injuries and ill health, and by
continuously improving occupational health and safety performance.

These certifications reflect the Company's commitment to maintaining high standards in environmental
protection, workplace safety, and overall operational excellence.

58. Credit Rating

The Company witnessed improvement in its credit profile during the year, reflecting its strong financial
performance.

Acuite Ratings & Research Limited (“Acuite”) has reaffirmed the Company's long-term rating at 'ACUITE
A-' (A minus) and short-term rating at 'ACUITE A2 ' (A two plus), with a 'Stable' outlook.

CARE Ratings Limited (“CARE Ratings”) has assigned/reaffirmed the Company's credit ratings, with long¬
term bank facilities rated CARE A- (A minus); Stable and short-term bank facilities reaffirmed at CARE A2
(A two plus), with a 'Stable' outlook.

The details ofthe Credit Ratings are available on the website ofthe Company at www.avantel.in/investors.

59. Nomination and Remuneration Policy

In line with the Company's philosophy of recognizing human resources as its most valuable asset and ensuring
equitable remuneration, the Company has formulated a Nomination and Remuneration Policy in accordance
with the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as amended from time to time.

The Policy lays down the criteria for appointment, remuneration and evaluation of Directors, Key Managerial
Personnel and Senior Management, with an objective to align individual aspirations with the Company's long¬
term goals.

The Nomination and Remuneration Policy is available on the website of the Company at:
www.avantel.in/investors.

60. Dividend Distribution Policy

Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015, the Company has adopted a Dividend Distribution Policy to determine the parameters and
circumstances under which dividends may be declared.

The Dividend Distribution Policy is available on the Company's website and can be accessed at:
www.avantel.in/investors.

61. Risk Management Policy

The Company has developed and implemented a comprehensive Risk Management Policy for identifying,
assessing and mitigating various risks that may affect its operations and overall performance.

The Risk Management Committee is responsible for monitoring and reviewing the risk management
framework and ensuring its effectiveness. The Audit Committee provides additional oversight in respect of
financial risks and internal controls.

Key business and operational risks are periodically identified and addressed through appropriate mitigation
measures. The Company has also established a robust internal audit system to evaluate and strengthen the
effectiveness of internal financial controls on an ongoing basis.

The Company follows an enterprise-wide risk management approach integrating risk identification,
assessment, mitigation and monitoring

Further details of the Risk Management Committee and its terms of reference are provided in the Corporate
Governance Report forming part of this Annual Report. The Risk Management Policy is available on the
Company's website at: www.avantel.in/investors.

62. Human Resources

The Company firmly believes that its people are its greatest strength and a key driver of its success. It remains
committed to nurturing talent through continuous learning, development initiatives and skill enhancement
programs to keep pace with evolving technological advancements.

Industrial relations during the year remained cordial. The Company continues to maintain a harmonious work
environment through effective communication, engagement and collaborative practices.

63. Prevention of Sexual Harassment

The Company has in place a Policy on Prevention of Sexual Harassment of Women at Workplace, in line with
the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013.

During the financial year under review, no complaints of sexual harassment were received.

The Company regularly conducts awareness programmes to sensitize employees on prevention of sexual
harassment.

The details of complaints received and disposed of during the year are as follows:

64. Investor Education and Protection Fund (IEPF)

Pursuant to the provisions of Sections 124 and 125 of the Companies Act, 2013, read with the Investor
Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“IEPF
Rules”), dividends that remain unclaimed for a period of seven (7) years from the date of transfer to the Unpaid
Dividend Account of the Company are required to be transferred to the Investor Education and Protection Fund
(IEPF).

Accordingly, members who have not en-cashed their dividend warrants / demand drafts in respect of the
unclaimed and unpaid dividends declared by the Company are requested to claim the same at the earliest.

Members are advised to approach the Company's Registrar and Share Transfer Agent, KFIN Technologies
Limited, well before the due dates for transfer of such unclaimed dividends to the IEPF.

The details of unclaimed dividends and the due dates for transfer to the IEPF are provided below:

Members may note that upon transfer of unclaimed dividend amounts to the IEPF, the corresponding shares in
respect of which dividends remain unclaimed for seven consecutive years are also liable to be transferred to the
IEPF Authority. No claim shall lie against the Company in respect of such amounts and shares transferred.
However, members may claim the same from the IEPF Authority by following the prescribed procedure.

65. Constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013

The Company has constituted an Internal Complaints Committee in accordance with the provisions of the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, to redress
complaints relating to sexual harassment at the workplace.

During the financial year under review, no complaints were received by the Committee.

66. Compliance with Secretarial Standards

The Company has complied with the applicable Secretarial Standards issued by the Institute of Company
Secretaries of India (ICSI).

67. Prevention of Insider Trading Code

Pursuant to the provisions ofthe SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company has in
place a Code of Conduct to regulate, monitor and report trading by insiders.

The Company has complied with the requirements of the said Code during the financial year under review.

68. Cyber Security

The Company has established requisite technologies, processes and practices designed to protect networks,
computers, programs and data from external attack, damage or unauthorised access. The Company is
conducting training programs for its employees at regular intervals to educate the employees on safe usage of
the Company’s networks, digital devices and data to prevent any data breaches involving unauthorised access
or damage to the Company’s data. The Information Technology Department of the Company is in a constant
process of taking feedback from the employees and updating the cyber security protocols. The Risk
Management Committee and the Board of Directors are reviewing the cyber security risks and mitigation
measures from time to time.

69. Compliance Management

The Company has built and adopted a compliance management tool as a part of the SAP. The application
provides a facility to update statutory compliances from time to time by attaching the evidence of compliance.

70. Maternity Benefit

The Company has duly complied with all provisions of the Maternity Benefit Act, 1961 and has extended all
statutory benefits to eligible women employees during the year.

71. Acknowledgments

Your directors place on records their sincere appreciation for the continued support and confidence reposed by
the Company's shareholders, customers, bankers, business partners, financial institutions, insurance
companies, and various Central and State Government authorities.

The Directors also wish to express their gratitude for the dedication, commitment and hard work demonstrated
by the employees and workmen at all levels, which has been instrumental in the Company's continued growth
and success.

By order of the Board of Directors
For Avantel Limited

Sd/-

Dr. Abburi Vidyasagar

Place: Hyderabad Chairman & Managing Director

Date: April 26, 2026 ^DIN: 00026524