Your Company is in the business of fabricators, exporters and importers of all kinds of clothing, readymade garments, jewellery, footwear, handbags, beauty products and all accessories related to fashion & lifestyle products, high fashion handmade & machine- made Embroideries. During the year under consideration your Company has achieved a consolidated turnover of Rs. 1429.12 Lakhs. Profit after tax on consolidated basis during the year stood at 200.85 Lakhs.

There was no change in the nature of business of the Company done during the financial year.

Your directors are of the opinion that the company should retain the profits and plough it back in the business and hence Directors have not proposed any Dividend.

The Directors do not propose transfer to General Reserve.

The Company has not changed its name during the financial year.

As on date of signing this report Authorized capital is Rs. 5,00,00,000/- divided into 50,00,000 equity shares of Rs. 10/- each. The Paid up share capital of the Company is Rs. 2,35,67,580/- divided into 23,56,758 equity shares of Rs. 10 each fully paid up.

During the year under review, the Company successfully completed its Initial Public Offer (“IPO”) comprising 7,99,200 Equity Shares of face value of 10 each, aggregating to 887.11 Lakhs. The Equity Shares of the Company were listed and admitted for trading on the BSE SME Platform of BSE Limited with effect from 15 September 2025.

During the Financial year under review, there were no changes in the Composition of Board of Directors except as follows:

Retire by Rotation: In accordance with the applicable provisions of the Companies Act, 2013 and rules made there under, Mrs. Archana Mustak Odiya (DIN: 09475973) retires by rotation at the forth coming 4^th Annual General Meeting and being eligible, offers herself for re-appointment.

As on the date of the report, following are the Key Management Personnel of the Company including the changes:

10. Meetings:

During the year 14 (Fourteen) Board Meetings were convened on 01/04/2025, 15/05/2025, 05/07/2025, 11/07/2025, 13/08/2025, 29/08/2025, 10/09/2025, 11/09/2025, 13/10/2025, 14/11/2025, 10/12/2025, 08/01/2026, 06/02/2026, 27/03/2026. 1 (One) Annual General Meeting of the Members was convened during the period under review on 12^th September, 2025 and 3 (three) Extra Ordinary General Meeting were convened on 25^th April, 2025, 15^th July, 2025 and 10^th November, 2025. The details of such meetings and attendance of Directors are given below:

11. Auditors:

Statutory Auditors

During the year under review, M/s. Kumbhat & Co. LLP, Chartered Accountants, resigned as the Statutory Auditors of the Company with effect from 08 October, 2025, resulting in a casual vacancy. Pursuant to Section 139(8) of the Companies Act, 2013, the Members at the Extraordinary General Meeting held on 10 November, 2025 appointed M/s. SMNK & Co., Chartered Accountants (Firm Registration No. 134153W), to fill the casual vacancy until the conclusion of the ensuing Annual General Meeting.

The Board has recommended their appointment as the Statutory Auditors of the Company for a term of five consecutive years, subject to the approval of the Members at the ensuing Annual General Meeting.

Statutory Auditors have expressed their unmodified opinion on the Standalone and Consolidated Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, or disclaimers.

Internal Auditor

Pursuant to the provisions of Section 138 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, the Board of Directors has appointed M/s. R G G R & Associates, Chartered Accountants, as the Internal Auditors of the Company for the Financial Year 2025-2026.

The Internal Auditors conducted the internal audit of the Company for the period October, 2025 to March, 2026, covering, inter alia, the Company's books, records, systems and controls relating to the accounts and finance functions.

The Internal Audit Report was submitted to the management and the Board of Directors. The observations and recommendations contained in the Internal Audit Report have been duly considered by the management, and necessary corrective and improvement measures are being undertaken wherever considered appropriate.

Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. R.B.Tanna & Associates, Practising Company Secretaries, Mumbai bearing C.P No. 14434 and Peer Review Certificate no. 5710/2024 were appointed as Secretarial Auditors for a term of 5(Five) years from Financial year 2025-26 to Financial year 2029-30 by the shareholders. The Secretarial Audit Report for the year under review is provided as Annexure-A of this report.

12. Auditors' Report:

The Auditors' Report does not contain any qualification remarks. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments.

13. Secretarial Auditor's Report and Observations

The Secretarial Auditors Report does not contain any qualification. The matters referred to in the Secretarial Auditors Report are self-explanatory and therefore do not call for any comments.

14. Disclosure about Cost Audit:

As per the provisions of section 148 of the Companies Act, 2013 read with the Cost Audit Orders, Cost Audit is not applicable to the Company's business.

15. Details of Subsidiary, Joint Venture or Associate Companies:

As on March 31, 2026, the Company has Vashishtha Embroideries Private Limited, as Material Subsidiary Company, except this the Company does not have any other Subsidiaries, Associates and Joint Ventures. The performance, financial position and the details required under section 129 of the Companies Act, 2013, for the subsidiary for the financial year ended March 31, 2026, in Form AOC-1, is attached as Annexure-B, which forms part of this report.

16. Vigil Mechanism:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, The Company has in place a Whistle Blower Policy/Vigil Mechanism which provides a framework for Directors and employees to report genuine concerns regarding unethical behaviour, actual or suspected fraud, violation of the Company's policies or applicable laws.

17. Risk management policy:

The Company has developed and implemented a risk management policy which identifies major risks which may threaten the existence of the Company. The same has also been adopted by your Board and is also subject to its review from time to time. Risk mitigation process and measures have been also formulated and clearly spelled out in the said policy.

18. Extract of Annual Return:

As required pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in form MGT 7 will be available at website of the Company www.vashishthaluxuryfashion.com

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

There have been no material changes or commitments affecting the financial position of the Company between the end of the financial year ended 31^st March, 2026 and the date of this Report, except for the matters approved by the Members through Postal Ballot on 14^th June, 2026, including material related party transactions and revision in remuneration of the Managing Director and Executive Director of the Company.

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

No significant and material orders have been passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

21. Deposits:

During the Financial year under review, the Company has neither invited nor accepted any deposits from the public, in accordance with Section 73 of the Companies Act, 2013, and the Companies (Acceptance of Deposits) Rules, 2014.

22. Particulars of loans, guarantees or investments under section 186:

The Company has not given loans, or guarantees or investments falling under the purview of section 186 of the Companies Act, 2013 and the rules framed there under during the current financial year.

23. Particulars of contracts or arrangements with related parties under section 188:

All the Contract or arrangement entered by the company during the financial year with related parties were in ordinary course of business and on arm's length basis. However, The Company has provided its related party transaction details in Form AOC-2 which has been annexed as Annexure-C, which forms part of this report.

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24. Obligation of Company Under the Sexual Harassment of Women At Workplace (Prevention, Prohibition And Redressal) Act, 2013:

In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9 December, 2013. Under the said Act every company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

The Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has appointed a representative for implementation of said policy. During the year Company has not received any complaint of harassment. During the year Company has not received any complaint of harassment and there are no complaints pending at the disposal of the Company.

Reporting on Sexual Harassment Complaints:

Number of sexual harassment complaints received during the year NIL

Number of sexual harassment complaints disposed off during the year NIL

Number of cases pending for a period exceeding ninety days NIL

25. Conservation of energy, technology absorption and foreign exchange earnings and outgo:

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows: a) Conservation of energy: The particulars regarding conservation of energy are not applicable to the Company.

(b) Technology absorption: The Company continuously undertakes Research and Development activities for introduction of new products and development in the manufacturing processes for improvement in productivity and efficiency.

(c) Research and Development

The Company has incurred the following expenses on research and development during the financial year:

(d) Foreign exchange earnings and Outgo

During the year, the total foreign exchange used was Rs. 77,54,558.31 and the total foreign exchange earned was Rs. 14,43,30,405.85

26. Corporate Social Responsibility (CSR):

The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is not applicable to the Company.

27. Human Resources:

Your Company treats its “human resources” as one of its most important assets.

Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement.

No employee draws a salary to the extent as required to be disclosed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

28. Safety, Health and Environment Safety:

The Company is committed to maintaining the highest standards of safety, health, and environmental sustainability at all its operations. Adequate safety measures are in place, and regular training and awareness programs are conducted for employees.

29. Industry Relations:

The industrial relations remained cordial and harmonious throughout the year. The Board places on record its appreciation for the dedication, commitment, and cooperation of all employees. The management continues to maintain an open communication culture and participative environment to ensure employee engagement and productivity.

30. Liquidity:

The Company maintains adequate liquidity and a strong financial position to meet its operational and strategic objectives.

As on March 31, 2026, the Company had consolidated cash and cash equivalents of Rs. 604.20 Lakhs ensuring sufficient liquidity for ongoing business requirements.

31. Company's Policy Relating to Directors Appointment, Payment of Remuneration and Discharge of their Duties:

The provisions of Section 178(1) relating to constitution of Nomination and Remuneration Committee are applicable to the Company.

The Nomination and Remuneration Committee has laid down the criteria for Directors Appointment and Remuneration including criteria for determining qualification, positive attributes and Independence of Director. The following attribute/criteria for selection have been laid by the board on the recommendation of committee.

The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP or at Senior Management level and recommend to the Board his/her appointment. The candidate shall possess adequate qualification, expertise and experience for the position he/she is considered for appointment. A Whole-Time KMP of the Company shall not hold office in more than one Company except in its subsidiary company at the same time. However, a Whole-Time KMP can be appointed as a Director in any company subject to the same being intimated to the Board or being in accordance with the policy of the Company. In case of an Independent Director, the proposed appointee should possess the desired attributes and should not suffer from any disqualifications as prescribed under Section 149(6) read with the relevant rules and Regulation 16 of the Listing Regulations.

32. Declaration by Independent Directors

All Independent Directors have submitted declarations under Section 149(6) confirming that they meet the criteria of independence and have complied with the Code for Independent Directors prescribed under Schedule IV of the Act and Regulation 16(1) (b) of SEBI (LODR) Regulations, 2015.

None of the Directors of the Company are disqualified as per section 164(2) of the Companies Act, 2013 and rules made thereunder or any other provisions of the Companies Act, 2013. The Directors have also made necessary disclosures to the extent required under provisions of section 184(1) of the Companies Act, 2013.

33. Details Of Committees

The Board has formulated following committees for compliance with corporate governance requirements:

Audit Committee

Nomination and Remuneration Committee Stakeholders Relationship Committee

Audit Committee:

The Audit Committee comprises of three directors out of which majority directors are Independent Directors namely Mr. Jaydeep Sodha, Chairman, Mr. Pratik Jain, Member and Mr. Mustak Odiya, Member. The Audit Committee met 6 times during the year on 15-05-2025, 13-08-2025, 13-10-2025, 14-11-2025, 08-01-2026 and 27-03-2026. All the members of the Audit Committee attended all the meetings held during the year.

Nomination and Remuneration Committee:

The Nomination and Remuneration Committee comprises of three directors out of which majority directors are Independent Directors namely, Mr. Pratik Jain, Chairman, Mr. Jaydeep Sodha, Member and Mr. Archana Odiya, Member. The Nomination and Remuneration Committee met 3 times during the year on 01-04-2025, 15-05-2025 and 27-03-2026. All the members of the Nomination and Remuneration Committee attended all the meetings held during the year.

Stakeholders' Relationship Committee

The Stakeholders' Relationship Committee comprises of three directors out of which majority directors are Independent Directors namely, Mrs. Archana Odiya, Chairperson, Mr. Jaydeep Sodha, Member and Mr. Pratik Jain, Member. The Stakeholders' Relationship Committee met twice during the year on 14-11-2025 and 08-01-2026. All the members of the Stakeholders' Relationship Committee attended all the meetings held during the year.

34. Directors' Responsibility Statement:

The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that

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

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

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

35. Disclosures Relating to Remuneration of Directors, Key Managerial Personnel and Particulars of Employees:

The information required under Section 197 of the Companies Act, 2013 read with Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors/ Employees of your Company is appended in Annexure D forming part of this Report.

36. Management Discussion and Analysis Report:

A report in the form of Management Discussion and Analysis Report is annexed hereto as Annexure E and forms part of this Report.

37. Board evaluation:

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, that of the Committees and individual Directors. The evaluation framework included criteria such as composition, experience, effectiveness of participation, decision-making, etc.

38. Insider Trading

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended, your Company has instituted a comprehensive Code titled as “Code of Conduct to regulate, Monitor and Report trading by Insiders” which lays down guidelines and advises the Directors and Employees of the Company on procedures to be followed and disclosures to be made while dealing in securities of the Company.

As part of its compliance with SEBI's regulations, the Company maintains a Structural Digital Database (SDD) to effectively track and monitor the sharing of UPSI. This system ensures that all necessary entries are made to safeguard the confidentiality of sensitive information

39. Transfer of Amounts to Investor Education and Protection Fund :

Your Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF).

40. Secretarial Standards:

Your Company has complied with the Secretarial Standards related to the Board Meetings and General Meeting issued by the Institute of Company Secretaries of India (ICSI).

41. Fraud Reporting:

During the year under review, there were no instances of material or serious fraud falling under Rule 13(1) of the Companies (Audit and Auditors) Rules, 2014, by officers or employees reported by the Statutory Auditors of the Company during the course of the audit.

42. Maternity Benefit Act, 1961

The Company has complied with the applicable provisions of the Maternity Benefit Act, 1961.

43. Website:

The Company has a functional website www.vashishthaluxuryfashion.com where information required to be hosted under the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is available. The website contains, inter alia, financial results, shareholding pattern, corporate governance information, policies, notices of general meetings, annual reports, stock exchange disclosures, and other statutory information for the benefit of shareholders and investors.

44. IBC Notice:

Further, your Directors confirm that no application has been filed against the Company before any bench of the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016 during the financial year under review or as on the date of this report.

45. Registrar And Transfer Agent:

The Company has appointed Bigshare Services Private Limited as its Registrar and Transfer Agent.

46. Depository System

The Company's equity shares are held in dematerialised form with both the Depositories National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL).The ISIN of the Company is INE0WRP01016. Dematerialisation has facilitated easier and safer trading for shareholders.

47. One Time Settlement Loan:

There was no one time settlement of loan obtained from the Banks or Financial Institutions.

48. Audit Trail Applicability (Audit and Auditors) Rules 2014 - Rule 11 of the Companies Act 2013:

The Company has implemented an Audit Trail (Edit Log) feature in its accounting software. The Audit Trail was installed during the previous financial year and has remained enabled and operated throughout the financial year under review without interruption.

49. Appointment Of Designated Person (Management and Administration) Rules 2014 - Rule 9 Of the Companies Act 2013:

In accordance with Rule 9 of the Appointment of Designated Person (Management and Administration) Rules 2014, it is essential for the Company to designate a responsible individual for ensuring compliance with statutory obligations. The Company has appointed Mr. Mustak Basirbhai Odiya, Director as the designated person in a Board meeting.

50. Acknowledgements:

An acknowledgement to all with whose help, cooperation and hard work the Company is able to achieve the results.