Dear members,

Your Board of Directors hereby submits the report of the business and operations of your Company ("the Company" or "Sarthak") along with the audited financial statements, for the financial year ended March 31, 2025.

(Rs in Lakhs)

The Company has undergone a phase of consolidation over the past 2 financial years, primarily due to significant challenges faced by our key end-user sector — the steel industry. Our core businesses, namely Cored Wires and Aluminium Flipping Coils, experienced headwinds from a prolonged slowdown in the Indian steel sector, subdued demand, and heightened competition resulting from an influx of low-cost imports. Notably, steel imports from China surged to a 7-year high, intensifying competitive pressures on domestic manufacturers and allied industries. Additionally, volatile raw material prices, global supply chain disruptions, and persistent margin pressures further complicated the operating environment. These factors impacting the steel industry also had a cascading effect on ancillary suppliers such as our Company. Moreover, competitive intensity increased in some of our product segments, prompting the Company to make a strategic decision to refrain from participating in these areas to safeguard profitability rather than pursue growth at any cost.

As a result, our Revenue from Operations for the year stood at Rs 178.42 Crore, compared to Rs 305.17 Crore in FY24, representing a year-on-year decline of 42%. EBITDA margins were 3.9% in FY25, down from 7.1% in FY24. Consequently, Net Profit for FY25 was Rs 4.12 Crore, as against Rs 13.83 Crore in FY24.

Looking ahead, to diversify our business beyond supplying consumables to the steel sector and to return to a growth trajectory, we have decided to increase our strategic focus on the welding consumables segment, with Flux Cored Wires as our initial product category. Flux Cored Wires are widely used in welding applications for commercial fabrication units, heavy industries and infrastructure projects. This product category aligns well with our technical expertise, and we are confident in our technological capabilities and product strengths to establish a strong presence in this industry in coming years. In the past financial year, we expanded our flux cored wire production capacity from 1,200 TPA to 3,600 TPA, responding to increasing product acceptance and rising market demand.

Our continued emphasis on value-added products, exploration of export opportunities, and expansion into adjacent product categories will position us for sustainable growth and enable us to capitalize on emerging opportunities.

The Board of Directors of your Company has decided not to transfer any amount to the Reserves for the year under review.

Considering the constant growth in earnings and profits of the Company your directors have in the Financial Year declared an Final Dividend for the year under review.

The Company declared dividend as under:

*Final Dividend is subject to Shareholders at their upcoming Annual General Meeting.

• The Company declares and pays dividend in Indian rupees. Companies are required to pay / distribute dividend after deducting applicable withholding income taxes. The remittance of dividends outside India is governed by Indian law on foreign exchange and is also subject to withholding tax at applicable rates.

During the year under review, there was no change in the nature of business carried on by the Company.

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

The Paid-up Equity share capital of the Company as on April 01, 2024 was Rs 13,68,97,500/- divided into 1,36,89,750 Equity Shares of Rs 10/- each. No change was made during the year. The equity share capital thus, as on March 31, 2025 was Rs 13,68,97,500/-.

During the F.Y. 2024-25 your Company has neither issued shares with differential voting rights as to dividends, voting or otherwise nor issued shares (including sweat equity shares) to the employees or directors of the Company under any scheme such as bonus, right issue, private placement, preferential allotment or by any other mode as per Companies Act, 2013.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Sunil Kumar Agrawal (DIN: 08680582), Director of your Company retires by rotation in the ensuing Annual General Meeting and being eligible offered himself for re-appointment.

Mr. Dwadasi Venkata Giri was appointed as the Independent Director of the Company by the Members at the 25^th Annual General Meeting of the Company held on September 09, 2020 for 5 (five) consecutive years commencing from July 31, 2020 and is eligible for re-appointment for a second term on the Board of the Company.

Based on the recommendation of the Nomination & Remuneration Committee ('NRC'), the Board of Directors at its meeting held on May 22, 2025, proposed the re-appointment of Mr. Dwadasi Venkata Giri as an Independent Director of the Company for a second term of 5 (five) consecutive years commencing from July 30, 2025, not liable to retire by rotation, for the approval of the Members by way of a Special Resolution.

Mr. Dwadasi Venkata Giri completed his Post Graduation (M. Com) from Pt. Ravishankar Shukla University, Raipur. He also completed LLB and CA IIB from Raipur. He has vast experience in the banking and finance domain and has retired from Bank of Baroda as Deputy Regional Manager. He has been on the Board of our Company since July 31, 2020 and is the Chairman of Stakeholders Relationship Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee and Audit Committee.

The Nomination and Remuneration Committee taking into consideration the skills, expertise and competencies required for the Board in the context of the business and sectors of the Company and based on the performance evaluation, concluded and recommended to the Board that Mr. Dwadasi Venkata Giri qualifications and the rich experience in the abovementioned areas and meets the skills and capabilities required for the role of Independent Director of the Company. The Board is of the opinion that Mr. Dwadasi Venkata Giri continues to possess the identified core skills, expertise and competencies fundamental for effective functioning in his role as an Independent Director of the Company, and his continued association would be of immense benefit to the Company.

Further, Mr. Dwadasi Venkata Giri has confirmed that he is not disqualified from being appointed as Director in terms of Section 164 of the Act and has given his consent to act as Director in terms of Section 152 of the Act, subject to re-appointment by the Members. Mr. Dwadasi Venkata Giri has also confirmed that he complies with Rules 6(1) and 6(2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, to his registration with the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs ('IICA') and has passed the online proficiency self-assessment test conducted by IICA.

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he / she meets the criteria of independence laid down in Section 149(6), Code for independent directors of the Companies Act, 2013 and of the Listing Regulations.

The independent directors, had, in addition to the provisions of Regulation 16(1)(b) of the Listing Regulations, also confirmed that he/she is not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact his ability to discharge his duties with an objective independent judgment and without any external influence and that he/she is independent of the management.

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).

In compliance with the Listing Regulations and the Companies Act, 2013, the Company has adopted the Code of Conduct for the members of the Board and Senior Executives of the Company. The Code is also applicable to Non-Executive Directors including Independent Directors to such extent as may be applicable to them depending on their roles and responsibilities. The Code gives guidance and support needed for ethical conduct of business and compliance of law.

A copy of the Code has been put on the Company's website (http://www.sarthakmetals.com/investors-code-of-conduct. aspx?mpgid=24). The Code has been circulated to Directors and Senior Executives and its compliance is affirmed by them annually. A declaration signed by the Chief Executive Officer is given below:

"I hereby confirm that the Company has obtained from all the members of the Board and senior executives, affirmation that they have complied with the Code of Conduct for Board of Directors and senior executives in respect of Financial Year 2024-25."

The Board of Directors met 5 (Five) times during the financial year 2024-25. The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Companies Act, 2013.

As on March 31, 2025, the Board had four committees: the audit committee, the corporate social responsibility committee, the nomination and remuneration committee and the stakeholder's relationship committee. All committee comprise only independent directors, one of whom is chosen as the chairperson of the committee.

During the year, all recommendations made by the committees were approved by the Board.

A detailed note on the composition of the Board and its committees is provided in the Corporate Governance Report in Annexure A.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration.

The Company's remuneration policy is directed towards rewarding performance based on review of achievements periodically. The remuneration policy is in consonance with the existing industry practice. Extract of Remuneration Policy from Nomination and Remuneration policy is annexed to this report as Annexure B and full policy can be accessed from website of the Company (http://www.sarthakmetals. com/docs/Nomination-and-Remuneration-Policy.pdf).

The Company believes that formal evaluation of the board and of the individual directors, on an annual basis, is a potentially effective way to respond to the demand for greater board accountability and effectiveness. For the Company, evaluations provide an ongoing means for directors to assess their individual and collective performance and effectiveness.

Having said that, the Company conducted the Board Evaluation process for the assessment of the performance of the entire Board, individual director performance, performance of the Chairperson and review of management support to the Board.

The performance of the board was evaluated by the Directors after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.

The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 05, 2017. In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

The Board of your Company acknowledges that given the roles and responsibility of the Independent Directors and Non-Executive Director of the Company they are from time to time made aware of the Company's business conduct, the strategy, operations and functions of the Company and also from time to time the Independent Directors along with the Non-Executive Director visit the manufacturing facilities of the Company situated at Hathkhoj, Durg, India, to understand the processes of manufacturing of Cored Wires, this enables them to take part in the Board and Committee meeting effectively and efficiently as and when a product related discussion comes before the Board and Committee meetings.

At various Board meetings during the year, the Board members are provided with information/ presentations and are given the opportunity to interact with the Senior Management of your Company to help them to understand the Company's strategy/policies, business model, operations, products, markets, organization structure, finance, human resources, technology, quality, facilities and risk management, changes in the regulatory environment applicable to the corporate sector and to the industry in which it operates and such other matters as may arise from time to time.

The policy on familiarization programmes for Independent Directors is posted on the website of the Company and can be accessed at (http://www.sarthakmetals.com/docs/ Familiarization%20of%20Independent%20Directors.pdf).

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

b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

c. The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The directors had prepared the annual accounts on a going concern basis;

e. The directors, in the case of a listed Company, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

f. The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

The Company has proper and adequate system of internal controls to ensure that all the assets are safeguarded and protected against losses from unauthorized use or disposition and that transaction are authorized, recorded and reported correctly. The Company has an effective system in place for achieving efficiency in operations, optimum and effective utilization of resources, monitoring thereof and compliance with applicable laws. The auditors have also expressed their satisfaction on the adequacy of the internal control systems incorporated by your Company.

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Board's report.

The Company does not have any Subsidiary Company or Joint Venture Company or Associate Company and hence this clause of Directors Report is not applicable.

During the year under review, your Company has not accepted, invited and/or received any deposits from public within the meaning of Section 73 & 76 of the Companies Act, 2013 and the Companies (Acceptance of Deposit) Rules, 2014, as amended from time to time.

There are no Loans, Investments or Guarantees/Security given by the Company during the year under Section 186 of the Companies Act, 2013; hence no particulars are required to be given.

Disclosure/details pursuant to provisions of Section 197(12) of the Companies Act 2013 read with the Companies (Appointment and Remuneration of managerial personnel) Rules, 2014 are given as follows:

The median remuneration of employees of the Company during the financial year was Rs 2,14,672 p.a. Please note that only those persons who were employees as on March 31, 2025 have been considered for the calculation of the median salary.

During the year, none of the employees received remuneration in excess of ' One Crore Two Lakhs or more per annum, or ' Eight Lakhs per month for the part of the year, in accordance with the provisions of Section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Therefore, there is no information to disclose in terms of the provisions of the Companies Act, 2013.

During the year under review, all related party transactions entered into by the Company, were approved by the Audit Committee and were at arm's length and in the ordinary course of business to further the business interests of the Company. Prior approval is obtained for related party transactions which are of repetitive nature and entered in the ordinary course of business and on an arm's length basis.

The Company did not have any contracts or arrangements with related parties in terms of Section 188(1) of the Act. Also, there were no material related party contracts entered into by the Company as per the Companies Act, 2013 and rules made thereunder. The disclosure as required under Section 134(3)(h) of the Act in Form AOC-2 is attached as Annexure C. Details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the notes to the standalone financial statements forming part of this Report.

In line with the requirements of the Act and the SEBI Listing Regulations, the Company has formulated a Policy on Related Party Transactions and the same can be accessed on the Company's website - (http://www.sarthakmetals.com/ docs/Policy%20on%20Materiality%20of%20Related%20 Party%20Transactions%20and%20Dealing%20with%20 Related%20Party%20Transactions.pdf).

Our corporate governance practices are a reflection of our value system encompassing our culture, policies, and relationships with our stakeholders. Integrity and transparency are key to our corporate governance practices to ensure that we gain and retain the trust of our stakeholders at all times. Corporate governance is about maximizing shareholder value legally, ethically and sustainably. Our disclosures seek to attain the best practices in international corporate governance.

Pursuant to Schedule - V of Listing Regulations, Corporate Governance Report along with the Auditors' certificate regarding compliance of conditions of Corporate Governance is made part of this report as Annexure A.

As required by Regulation 34 read with Schedule - V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 a Management Discussion & Analysis Report is cover between page to of this report.

Your Company believes in giving back to society in some measure that is proportionate to its success in business. In view of this, the Company's Corporate Social Responsibility (CSR) aims to extend beyond charity and enhance social impact.

In this direction, the Company's CSR Committee steers us and as per the Annual Action Plan, the said committee had approved the areas of rural development, eradication of poverty and hunger, education, healthcare and environmental sustainability. CSR has been an integral part of the way the Bansal Group conducts its business since its inception.

We focus on our social and environmental responsibilities to fulfil the needs and expectations of the communities around us. Our CSR is not limited to philanthropy, but encompasses holistic community development, institution-building and sustainability-related initiatives. Our CSR Policy aims to provide a dedicated approach to community development in the areas of rural development, eradication of poverty and hunger, education, healthcare and environmental sustainability. We contribute to serve the development of people by shaping their future with meaningful opportunities, thereby accelerating the sustainable development of society while preserving the environment, and making our planet a better place today and for future generations.

The Corporate Social Responsibility CSR Policy of the Sarthak Metals is aligned with its overall commitment to maintaining the highest standards of business performance. We recognize that our business activities have direct and indirect impact on the society. The Company strives to integrate its business values and operations in an ethical and transparent manner to demonstrate its commitment to sustainable development and to meet the interests of its stakeholders.

Members are requested to refer the Corporate Governance Report forming part of this annual report for the composition of the CSR Committee. The CSR policy of the Company is available on the website of the Company at (http://www. sarthakmetals.com/docs/Corporate-Social-Responsibility- Policy.pdf).

The annual report on the CSR activities is annexed as Annexure D to this report.

A. The provisions relating to conservation of energy and technology absorption, as stipulated in the Companies (Accounts) Rules, 2014, are not applicable to the Company, as its operations are not energy intensive. Nevertheless, in line with the Company's commitment to sustainability and the availability of alternative energy sources, the Board of Directors, at their meeting held on 11^th November 2022, approved the installation of a rooftop solar power plant. This solar project has contributed to an ~50% decrease in our energy expenses with captive consumption. Additionally, the Company's technology is developed in-house and is subject to continuous upgrades to maintain operational excellence.

B. Foreign exchange earnings and Outgo:

(in Rs)

During the year, the Company reviewed and strengthened its risk management policy and the risk management framework which ensures that the Company is able to carry out identification therein of elements of risk, if any, which in the opinion of the Board may threaten the existence of the Company.

Pursuant to the Section 177 (9) and (10) of the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated Whistle Blower Policy for vigil mechanism for Stakeholders, Individual Employees and their representative bodies, to report to the audit committee about the illegal or unethical practices or frauds, or violation of the Company's Code of Conduct.

It gives a platform to the whistle blower to report any unethical or improper practice (not necessarily violation of law) and to define processes for receiving and investigating complaints. The mechanism also provides adequate safeguards against victimization of employees and directors who use such mechanism and makes provision for direct access to the Chairman of the Audit Committee in appropriate and exceptional cases.

The full policy on whistle blower is available at (http://www. sarthakmetals.com/docs/SML-Whistle-Blower-Policy.pdf).

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Company's operations in future.

At the twenty-seventh AGM held on September 05, 2022, the Members approved the re-appointment of Begani and Begani, Chartered Accountants (Firm Registration 010779C) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of that AGM till the conclusion of the thirty-second AGM to be held in the year 2027.

Pursuant to the provisions of Regulation 24A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and provisions of Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 ("Rules"), the Audit Committee and the Board of Directors at their respective meetings held on May 22, 2025, have approved and recommended the appointment of M/s. Nilesh A. Pradhan & Co. LLP, Company Secretaries (Firm Registration No. L2018MH005200), a Practicing Company Secretary for the first term of Five Years commencing from April 01, 2025. The Appointment of Secretarial Auditors is subject to approval of the members at ensuing Annual General Meeting.

Pursuant to the provisions of Section 148 of Companies Act, 2013 and the rules made thereunder, the Company has appointed Mr. Gajadhar Prasad, Cost Accountants (Membership No. 39559) to undertake the Cost Audit of the Company for the Financial Year ended March 31, 2025.

The Board on the recommendation of Audit Committee of the Company, have appointed M/s. Gajadhar Prasad and Co., Cost Accountants (Membership No. 39559) as Cost Auditors to conduct Cost Audit for the Financial Year ended March 31, 2026, the remuneration to be paid to Cost Auditors is proposed to be approved by the members at the upcoming Annual General Meeting of the Company.

The Secretarial Audit Report for the financial year ended March 31, 2024 is annexed to this report as Annexure E and forms an integral part of this report.

The Board has duly reviewed the Statutory Auditor's Report on the Financial Statements of the Company. The observations, comments and notes of Auditor are self-explanatory and do not call for any further explanation/clarification.

32.1. As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors' Certificate thereon, and the Management Discussion and Analysis form part of the Director's Report.

32.2. The Company properly complies with the provision of all applicable Secretarial Standards on Meetings of Board of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2), respectively issued by the Institute of Company Secretaries of India.

The Company in compliance with Section 124 of Companies Act, 2013 has transferred to the Unpaid Dividend Account the following amounts to the Unpaid Dividend Accounts:

Pursuant to the provisions of Section 124 of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting. Audit, Transfer and Refund) Rules, 2016 as amended which provides that all dividend(s) remaining unpaid or unclaimed for a period of seven years from the date of transfer to Unpaid Dividend Account are required to be transferred to the Investor Education and Protection Fund (IEPF) Authority established by the Central Government.

Dividend declared by the Company during the financial year 2016-17, which remained unpaid/ unclaimed for a period of seven years have been transferred to the account maintained by the IEPF Authority. The Company is making all the efforts to deliver individual notices through emails to the shareholders whose unpaid dividend has not been claimed.

More details are available at the website of the Company at (http://www.sarthakmetals.com/investors-unpaid- dividend.aspx?mpgid=24)

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Annual return as on March 31, 2025 is available on the Company's website on https://sarthakmetals.com/ docs/Annual%20Return%202024-25.pdf

The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 and such accounts and records are made and maintained.

The Company has not made any application nor any proceeding under the Insolvency and Bankruptcy Code,

2016 is pending, hence this disclosure is not applicable to the Company.

During the year under review, the Company has not entered into one-time settlement with any Banks or Financial Institutions, hence this disclosure is not applicable to the Company.

At Sarthak, our goal has been to create an open and safe workplace where each and every employee feels empowered to contribute to the best of their abilities, irrespective of gender, sexual preferences or any other classification that has no bearing on the employee's work output. Towards this, the Company has already set up the Internal Complaints Committee to consider and resolve all sexual harassment complaints reported by women. The constitution of the IC is as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The committee is chaired by Ms. Pratibha Prasad, Manager, Human Resource, SARTHAK METALS LIMITED. No compliant was received during the year.

The Directors thank the Company's shareholders for their trust reposed on the Board of Directors, the Directors also thank employees, customers, vendors and all the stakeholders for their continuous support. The Directors also thank the Government of India, Governments of various states in India and concerned Government departments and agencies for their co-operation.