The Board of Directors is pleased to present the 36^th Annual Report of Balu Forge Industries Limited ("the Company") together with
the Audited Financial Statements of the Company for the Financial Year ended 31^st March 2025.

FINANCIAL RESULTS

The Company's financial performance during the year ended 31^st March 2025 compared to the previous financial year is
summarised below:

The Financial Statements for the year ended 31^st March
2025 have been prepaid as per the Indian Accounting
Standards (Ind AS).

REVIEW OF OPERATIONS

During the financial year ended 31^st March 2025, the Company
has recorded, on standalone basis, total revenue of H 61,591.08
Lakhs and the Company have earned Net Profit of H 13,422.97
Lakhs as compared to H 38,970.98 Lakhs and H 6.714.50 Lakhs
of the previous year, respectively.

On consolidated basis, the Company achieved total revenue of
H 94,076.04 Lakhs and the Company has earned Net Profit of
H 20,385.54 Lakhs as compared to previous year total revenue
of H 57,009.03 Lakhs and Net Profit of H 9,349.32 Lakhs.

There was no change in nature of business of the Company,
during the year under review.

OPERATIONAL HIGHLIGHTS

During FY25, Balu Forge Industries Limited undertook significant
capacity expansion and infrastructure development. Forging
capacity was scaled up to 100,000 TPA with further expansion
in progress, while precision machining capacity increased to
45,000 TPA. The Company commissioned advanced equipment,
including 16-ton closed-die forging hydraulic hammers, with
an 8,000-ton mechanical forging press and 25 ton closed die
forging hydraulic press under commissioning. The 46 acre
greenfield facility was advanced, featuring robotic handling,
anti-vibration systems, and Industry 4.0-enabled processes,

with a dedicated forging and machining line for defence
scheduled to commence in H1 FY26.

On the product and R&D front, BFIL enhanced its portfolio across
crankshafts, undercarriage parts, turbine blades, aerospace
and defence components. Its in-house R&D team of over 75
professionals focused on new alloys, rapid prototyping, and
high-precision machining. With product development cycles
averaging 3-5 months and product lifecycles spanning beyond
10 years, the Company has further strengthened its innovation
capabilities through advanced metallurgical labs, tool rooms,
and inspection systems.

The Company also diversified sectoral contributions, with
growing presence in defence, aerospace, and railways. Defence
remains a strategic priority, with approval to supply over
180 products. While legacy sectors like commercial vehicles
continued to expand, their contribution reduced as high-value
sectors gained share. Alongside, BFIL expanded its footprint to
over 80 countries, servicing 25 global OEMs, and benefitted
from global supply chain shifts under the China 1 and
Europe 1 trends.

Operational efficiency remained a key focus, with increased
emphasis on value-added fully machined components,
integration of 7-axis & 11-axis CNC machining and, automation
in forging. These initiatives improved scalability, cost efficiency,
and resilience across operations. On the ESG front, the
Company has committed to becoming carbon neutral by 2040,
transitioning fully to renewable energy by 2035, achieving
100% water recycling by 2027 and Zero Liquid Discharge by
2030, and reducing total waste generation by 2030. In FY25,

BFIL recovered 3,661 MT of waste and spent H7.5 million on

CSR initiatives, directly benefitting 517 individuals.

FUTURE OUTLOOK

• Balu Forge Industries Limited delivered a robust
performance in FY25 with consolidated revenue from
operations of Rs. 92,361.74 lakhs, registering a growth of
65.0% over Rs. 55,985.58 lakhs in FY24. EBITDA increased
sharply to Rs. 25,110.73 lakhs, up 110.8% from Rs.
11,912.08 lakhs in the previous year, supported by higher
volumes, operating efficiencies, and an enhanced product
mix. EBITDA margin expanded to 27.2% as against 21.3%
in FY24, underscoring the Company's focus on high-value
precision machining.

• Profit after tax stood at Rs. 20,385.54 lakhs, an increase
of 118.0% compared to Rs. 9,349.32 lakhs in FY24, with
PAT margin improving to 21.7% from 16.4%. Earnings per
share rose to Rs. 19.24 in FY25 compared to Rs. 9.80 in
FY24, reflecting a strong year-on-year growth of nearly
97%. Return ratios remained healthy, with ROCE at 30.1%
and ROE at 25.4%, driven by robust profitability and
efficient capital utilization.

• On the balance sheet side, borrowings declined to Rs.
3,591.25 lakhs from Rs. 4,877.53 lakhs in FY24, resulting
in an improvement in the net debt-to-equity ratio by
66.7%, positioning the Company nearly debt-free. The cash
conversion cycle improved by 25 days to 104 days, while
CFO/EBITDA stood at 59%, highlighting strong cash flow
management and disciplined working capital practices.

CREDIT RATING

CRISIL Ratings Limited has revised its Credit rating during the

year, for its bank facilities as follows:

The above rating reflects the overall improvement in the credit
risk profile of the company backed by strong growth in scale of
operations and healthy profitability.

TRANSFER TO RESERVES

The Board of Directors has decided to retain the entire profit
generated during the year under review, in the profit and loss
reserve account. Accordingly, it is not proposed to transfer any
amount to the ‘Reserves' from the profit for the year ended
31^st March 2025.

DIVIDEND

The Board of Directors at their meeting held on May 14, 2025,
has recommended payment of H 0.15/- at the rate of 1.5% per

fully paid-up equity share of the face value of H10/- each as
final dividend for the financial year ended 31^st March 2025. The
payment of the final dividend is subject to the approval of the
shareholders at the ensuing Annual General Meeting (AGM) of
the Company. The dividend shall be paid to those shareholders
whose name appear in the Register of Members as on the
Record Date, on approval by the members at the Annual
General Meeting.

In view of the provisions of the Income Tax Act, 1961, dividends
paid or distributed by the Company shall be taxable in the hands
of the Shareholders. The Company shall, accordingly, make the
payment of the final dividend after deduction of tax at source.
The proposed dividend been recommended in accordance with
the Dividend Distribution Policy of the Company.

DIVIDEND DISTRIBUTION POLICY

The Company has in place a Dividend Distribution Policy in
accordance with Regulation 43A of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015 and the
same is available on the Company's website at https://www.
baluindustries.com/corporate-qovernance.php

UTILISATION OF PREFERENTIAL ALLOTMENT
PROCEEDS

The proceeds of funds raised under preferential Allotments
of the Company have been fully utilised as per Objects of the
Issue. The disclosure in compliance with the Regulation 32(7A)
of the SEBI (Listing Obligation and Disclosure Requirements)
Regulations, 2015 ("Listing Regulations") and detailed utilization
are provided in the Corporate Governance Report which forms
part of this Report.

CHANGES IN SHARE CAPITAL:

Increase in Authorised Share Capital of the Company

The Authorised Share Capital of the Company has increased
from H 1,10,00,00,000/- (Rupees One Hundred and Ten Crore
Only) divided into 1 1,00,00,000/- (Eleven Crore) Equity Shares
of H 10/- (Rupees Ten only) each to H 1,25,00,00,000/- (Rupees
One Hundred and Twenty-Five Crore Only) divided into
12,50,00,000/- (Twelve Crore and Fifty Lakh) Equity Shares of
H 10/- (Rupees Ten only).

Issue and Allotment of Equity Shares & Warrants on
Preferential Basis

During the FY 2024-25, the Company has issued and allotted:

i. 36,75,000 Equity Shares having face value of H10/- each at
an issue price of H 183.60/- fully paid up upon exercising
the option available with the Share Warrant Holder (person
belonging to the Promoter group).

ii. 45,00,000 Equity Shares to the Non-Promoters (Public
Category) on preferential basis of H10/- each for cash at
premium of H 350/- aggregating to H 1,62,00,00,000/-.

iii. 93,00,000 Convertible Warrants to persons forming
part of promoter group on preferential basis of H 10/-

each for cash at premium of H 350/- aggregating to
H 3,34,80,00,000/-, with an option to convert the same into
equal number of equity shares of H10/- (Rupees Ten) each
at an issue price of H 360/- per share within a period of
18 months from the date of allotment of warrants, as per
terms and conditions approved in Extra-Ordinary General
Meeting held on 09^th August, 2024.

Share capital as on 31^st March 2025

The paid-up Equity Share Capital as on 31^st March 2025 was
stood at H 1,10,76,69,000/- divided into 1 1,07,66,900 Equity
Shares of H 10/- each.

The Company has neither issued any shares with differential
rights as to dividend, voting or otherwise nor issued any sweat
equity shares and issue shares under Employees Stock Option
Scheme as per provisions of Section 62 (1) (b) of the Act read
with Rule 12(9) of the Companies (Share Capital and Debenture)
Rules 2014, during the year under review.

CONSOLIDATED FINANCIAL STATEMENTS

In compliance with the applicable provisions of the Companies
Act, 2013, including the relevant Indian Accounting Standards
(Ind AS) as issued by the Institute of Chartered Accountants
of India and notified under Section 133 of the Companies
Act, 2013 and as required under Regulation 34 of the Listing
Regulations, 2015, this Annual Report includes Consolidated
Financial Statements for the FY 2024-25.

REPORT ON PERFORMANCE OF SUBSIDIARIES,
JOINT VENTURES AND ASSOCIATE COMPANIES

The Company has in total Three (3) Subsidiaries of which
Two (2) are Indian and One (1) Overseas and One (1)
Associate Company: -

1. Naya Energy Works Private Limited (WOS)

2. Balu Advanced Technologies & Systems
Private Limited (WOS)

3. Safa Otomotiv FZ - LLC in Dubai (as a WOS)

4. *Swan Balu Heavy Industries Limited ("SBHIPL") -
Associate Company

* SBHIPL was incorporated In 20^lh April, 2025 as SPV Company with Swan
Energy Limited. The Company holds 40% equity in SBHIPL, pursuant to
the said Investment, SBHIPL has become the Associate of Balu Forge
Industries Limited w.e.f. 23^rd June, 2025.

The Company does not have any Joint Venture within the
meaning of Section 2(6) of the Companies Act, 2013. No
material change has taken place in the nature of business of
the subsidiaries.

Pursuant to the first proviso to Section 129(3) of the Companies
Act, 2013 read with Rule 5 and 8 of the Companies (Accounts)
Rules, 2014, the salient features of the financial statements and
performance of each subsidiary in Form AOC-1 is disclosed
under Annexure-A and forms part of this Report.

Pursuant to the provisions of Section 136 of the Companies Act,
2013, the standalone and consolidated financial statements
of the Company, and separate audited financial statements
in respect of subsidiaries are available on the website of the
Company under web link https://www.baluindustries.com/
financial-information.php

The Company has formulated a Policy for determining
material subsidiaries. The said policy is available on the
website of the Company at https://www.baluindustries.com/
corporate-governance.php

UNCLAIMED AND UNPAID DIVIDENDS AND TRANSFER
OF SHARES TO IEPF

Pursuant to Section 124 of the Companies Act, 2013 read with
the Investor Education Protection Fund Authority (Accounting,
Audit, Transfer and Refund) Rules, 2016 ("Rules"), all dividends
remaining unpaid or unclaimed for a period of 7 years and
also the shares in respect of which the dividend has not
been claimed by the shareholders for 7 consecutive years
or more are required to be transferred to Investor Education
Protection Fund (IEPF) in accordance with the procedure
prescribed in the Rules.

During the year under review, there was no transfer of
unclaimed and unpaid dividend and equity shares to the
Investor Education and Protection Fund in terms of Section 125
of the Companies Act, 2013.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS MADE UNDER SECTION 186 OF THE
COMPANIES ACT, 2013

Particulars of loans given, investments made, guarantees given
and securities provided during the year under review and as
covered under the provisions of Section 186 of the Companies
Act, 2013, have been disclosed in the notes to the standalone
financial statements forming part of the Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134 (5) of the
Companies Act, 2013, in relation to audited financial statements
of the Company for the year ended 31^st March 2025; the Board
of Directors hereby confirms 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 have selected such accounting policies
and applied them consistently and made judgments and
estimates that were 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 31^st March 2025 and of the
profit of the Company for the year under review;

c. the Directors had taken proper and sufficient care for
the maintenance of adequate accounting records in

accordance with the provisions of the Companies Act,
2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

d. the Directors had prepared the accounts for the financial
year ended 31^st March 2025 on a going concern basis;

e. the Directors had laid down internal financial controls to be
followed by the Company and that such internal financial
controls are adequate and were operating effectively;

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

DEPOSITS

The Company has not accepted any deposits within the
meaning of sub-section (31) of Section 2 and Section 73 of
the Companies Act, 2013 ("the Act") and the Rules framed
thereunder. As on 31^st March 2025, there were no deposits lying
unpaid or unclaimed.

DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP)

i. Composition of the Board of Directors

The Board of Directors is duly constituted. The details
of the directors are given in the Corporate Governance
Report forming part of the Annual Report.

ii. Changes in Composition of Board and Key Managerial
Personnel

Mr. Sumer Singh (DIN: 10768646), was appointed by
the Board of Directors as an Additional Director (Non¬
Executive Independent Category) of the Company w.e.f.
06^th September, 2024. Thereafter he has resigned from
the Board w.e.f. 25^th September, 2024 due to no-receipt of
No-Objection Certificate (NOC) from Union Bank of India,
where he served as Deputy General Manager (DGM and
he confirmed that there are no any material reasons other
than those provided above.

The Board of Directors at their meeting held on
07^th February, 2025 approved appointment of Mr. Roop
Lal Meena (DIN: 10938270) as an Independent Director
of the Company for a term of five years with effect from
07^th February, 2025.

Subsequently, the shareholders approved his appointment
through Postal Ballot process on 23^rd April, 2025.

Retirement of Directors by Rotation

Mr. Jaikaran Jaspalsingh Chandock, (DIN: 06965738), Wholetime
Director, being longest in the office is liable to retire by rotation
at the ensuing Annual General Meeting of the Company and
being eligible, he has offered himself for appointment.

Pursuant to Regulation 36 of the Listing Regulations read with
Secretarial Standard-2 on General Meetings, necessary details
of Mr. Jaikaran Chandock, have been provided as an Annexure
to the Notice of the Annual General Meeting.

Key Managerial Personnel

During the year under review, there was no change in Key
Managerial Personnel of the Company as prescribed under
Section 203 of the Companies Act, 2013.

DECLARATION OF INDEPENDENT DIRECTORS

In accordance with Section 149(7) of the Companies Act, 2013,
and Regulation 25(8) of the Listing Regulations, as amended,
each Independent Director of the Company has provided
a written declaration confirming that he/she meets the
criteria of independence as stipulated under Section 149(6)
of the Companies Act, 2013 and Regulation 16(1 )(b) of the
Listing Regulations.

In the opinion of the Board, Independent Directors fulfil the
conditions specified in Companies Act, 2013 read with the
Schedules and Rules issued thereunder as well as Listing
Regulations and are independent from Management.

All the Independent Directors of the Company have enrolled
their names in the online database of Independent Directors
maintained with the Indian Institute of Corporate Affairs in
terms of Section 150 of the Companies Act, 2013 read with
Rule 6 of the Companies (Appointment & Qualification of
Directors) Rules, 2014.

FAMILIARISATION PROGRAMME FOR INDEPENDENT
DIRECTORS

The familiarization program aims to provide Independent
Directors with the industry scenario, the socioeconomic
environment in which the Company operates, the business
model, the operational and financial performance of the
Company, significant developments so as to enable them to
take well informed decisions in a timely manner.

The familiarization program also seeks to update the Directors
on the roles, responsibilities, rights and duties under the Act
and other statutes, also directors are regularly briefed on
the regulatory changes and legal updates applicable to the
Company. This facilitates Board interaction and engagement
with the Senior Management team.

The details of the training and familiarisation programmes
arranged by the Company during FY 2024-25 are disclosed
on the Company's website under the web-link https://www.
baluindustries.com/corporate-qovernance.php

DISCLOSURES RELATED TO BOARD, COMMITTEES
AND POLICIES
Board Meetings

The Board of Directors met Eight (8) times during the financial
year under review. The details of the Board meetings and
attendance of each Director thereat are provided in the Corporate
Governance Report forming part of the Annual Report.

The periodicity between two Board Meetings was within
the maximum time gap as prescribed in the SEBI Listing
Regulations, 2015 / The Companies Act, 2013.

Audit Committee

The Audit Committee of the Company is constituted/re- constituted in line with the provisions of Regulation 18 of SEBI (Listing
Obligations and Disclosure requirements) Regulations, 2015 read with Section 177 of the Companies Act, 2013.

The Composition of the Audit Committee is as under:

*Mr. Roop Lal Meena, was appointed as independent Director w.e.f. 07^h February 2025. Further the Audit Committee was reconstituted on 07^th August 2025, to include
Mr Roop Lal Meena, as a Member of the Committee w.e.f. 07^th August 2025.

The terms of reference of the Audit Committee and the particulars of meetings held, and attendance thereat are mentioned in the
Corporate Governance Report forming part of the Annual Report. The Statutory Auditors, Internal Auditor and Whole Time Directors/
Chief Financial Officer are being invited to the meeting as and when required.

Nomination & Remuneration Committee

The Nomination and Remuneration Committee recommends the appointment of Directors and remuneration of such Directors. The
level and structure of appointment and remuneration of all Key Managerial personnel and Senior Management Personnel of the
Company, as per the Remuneration Policy, is also overseen by this Committee.

The Composition of the Nomination & Remuneration Committee is as under:

*Mr. Roop Lal Meena, was appointed as independent Director w.e.f. 07^h February 2025. Further the Audit Committee was reconstituted on 07^th August 2025, to include
Mr Roop Lal Meena, as a Member of the Committee w.e.f. 07^th August 2025.

The Nomination & Remuneration Committee is duly constituted,
during the year under review. The terms of reference of the
Nomination and Remuneration Committee and the particulars
of meetings held, and attendance thereat are mentioned in the
Corporate Governance Report forming part of the Annual Report.

Policy on Appointment and Remuneration of Directors,
Key Managerial Personnel and Senior Management
Personnel

The Board of Directors has adopted a Nomination and
Remuneration Policy in terms of the provisions of sub- section
(3) of Section 178 of the Act and SEBI Listing Regulations
dealing with appointment and remuneration of Directors, Key
Managerial Personnel and Senior Management Personnel and
other employees of the Company.

The policy covers criteria for determining qualifications, positive
attributes, independence and remuneration of Directors, Key
Managerial Personnel and Senior Management Personnel as

required under sub-section (3) of Section 178 of the Companies
Act, 2013 and the Listing Regulations.

The Nomination and Remuneration Policy of the Company is
hosted on the Company's website under the web link https://
www.baluindustries.com/corporate-qovernance.php

Stakeholders’ Relationship Committee

The Stakeholders Relationship Committee was constituted by
the Board of Directors in compliance with the provisions of
Section 178 of the Companies Act, 2013 and Regulation 20 of
the Listing Regulations.

The scope of the Shareholders/ Investors Grievance Committee
is to review and address the grievance of the shareholders in
respect of share transfers, transmission, non-receipt of annual
report, non-receipt of dividend etc, and other related activities.
In addition, the Committee also looks into matters which can
facilitate better investor's services and relations.

The brief terms of reference, particulars of meetings held, and
attendance thereat are mentioned in the Corporate Governance
Report forming part of the Annual Report.

Corporate Social Responsibility Committee

In accordance with the provisions of Section 135 of the
Companies Act, 2013 read with Companies (Corporate Social
Responsibility Policy) Rules, 2014, as amended from time to
time, the Board of Directors of the Company has constituted
Corporate Social Responsibility (CSR) Committee.

One of the key focus areas of the Committee is to make CSR to
play a vital role and provide a reasonable contribution to the

society by entering into sustainable programs of high impact
and integrity. The CSR Committee reviews and monitors the
CSR projects and expenditure undertaken by the Company on a
regular basis and apprises the Board of the same.

The brief outline of the Company's CSR initiatives undertaken
during the year under review is furnished in "Annexure-B"
in the format as prescribed in the Companies (Corporate
Social Responsibility Policy) Rules, 2014, as amended from
time to time. The Company's CSR Policy is placed on the
website of the Company https://www.baluindustries.com/
corporate-governance.php

ATTRIBUTES, QUALIFICATIONS & INDEPENDENCE
OF DIRECTORS, THEIR APPOINTMENT AND
REMUNERATION

The Nomination & Remuneration Committee of Directors
have approved a Policy for Selection, Appointment and
Remuneration of Directors which inter-alia requires that
composition of remuneration is reasonable and sufficient
to attract, retain and motivate Directors, KMP and senior
management employees and the Directors appointed shall be
of high integrity with relevant expertise and experience so as to
have diverse Board and the policy also lays down the positive
attributes/criteria while recommending the candidature for the
appointment as Director.

ANNUAL EVALUATION OF DIRECTORS, COMMITTEES
AND BOARD

Pursuant to the provisions of the Companies Act, 2013 and
as per the Listing Regulations, the Board of Directors carried
out annual performance evaluation of its own performance,
individual directors as well as the working of its committees.

The performance of the Board as a whole and of its Committees
was evaluated by the Board through structured questionnaire
which covered various aspects such as adequacy of composition
of Board and its Committees, execution and performance of
specific duties and obligations, preparedness and participation
in discussions, quality of inputs, effectiveness of the functions
allocated, relationship with management, appropriateness and
timeliness of information etc.

Taking into consideration the responses received from the
Individual Directors to the questionnaire, the performance of the
Board and its Committees was evaluated. The Directors have
expressed their satisfaction with the constitution of the Board
and its Committees and performance of each of the directors.

In terms of requirements of Schedule IV of the Companies
Act, 2013, a separate meeting of Independent Directors of the
Company was held on Friday, 07^th February, 2025 to review:

• The performance of non-independent directors and the
Board as a whole and its committees thereof;

• The performance of the Chairman of the Company,
taking into account the views of executive directors and
non-executive directors;

• To assess the quality, quantity and timeliness of the flow
of information between the Management and the Board.
Performance evaluation of Independent Directors was
done by the entire Board, excluding the Independent
Director being evaluated.

PARTICULARS OF EMPLOYEES

In terms of the requirements of sub-section (12) of Section 197
of the Act read with sub-rule (1) of Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, as amended from time to time, the disclosures

pertaining to the remuneration and other details, are annexed
to this Report as ‘‘Annexure - C".

In terms of Section 136(1) of the Act, details of employee
remuneration as required under provision of Section 197 of
the Companies Act, 2013 and rule 5 (2) and rule 5 (3) of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are available for inspection and any
member interested in obtaining a copy of the same may write
to Company at compliance@baluindustries.com

RELATED PARTY TRANSACTIONS

The Audit Committee reviews all the related party transactions
and subsequent modifications and Omnibus approval is
obtained before the commencement of the new financial year,
for the transactions which are repetitive in nature and also
for the transactions which are not foreseen. A statement of
all related party transactions is presented before the Audit
Committee on a quarterly basis specifying the nature, value and
terms & conditions of the transactions.

During the year under review, all the transactions entered into
by the Company with the Related Parties were at arm's length
and in the ordinary course of business. These transactions
were preapproved by the Independent Directors of the Audit
Committee. The transactions entered by the Company with
the related parties during the year were in compliance with
the applicable provisions of the Companies Act, 2013 and the
Listing Regulations. The details of actual transactions were
reviewed by the Audit Committee on a quarterly basis.

During the FY 2024-25, your Company did not enter into any
material related party transactions. Accordingly, disclosure
with respect to the same in the Form AOC- 2 in terms of Section
134 of the Companies Act, 2013 is not furnished.

During the year under review, Policy on Related Party
Transactions in compliance with the requirements of
Companies Act, 2013 and amendment to SEBI Listing
Regulations, is available on the website of the Company https://
www.baluindustries.com/corporate-qovernance.php.

IMPLEMENTATION OF RISK MANAGEMENT POLICY

The Company has formulated a policy and process for risk
management. The Company has set up a core group of
leadership team, which identifies, assesses the risks and the
trends, exposure and potential impact analysis at different level
and lays down the procedure for minimization of risks. Risk
Management forms an integral part of Management policy and
is an ongoing process integrated with the operations.

VIGIL MECHANISM AND WHISTLE BLOWER POLICY

Pursuant to the provisions of Section 177(9) of the Companies
Act, 2013 read with Rule 7 of the Companies (Meetings of
Board and its Powers) Rules, 2014, and in accordance with
Regulation 22 of the Listing Regulations, the Company had
adopted ‘Vigil Mechanism Policy' for Directors, Employees and

other Stakeholders of the Company to report concerns about
unethical behaviour.

The policy provides a mechanism, which ensures adequate
safeguards to Employees, Directors and other stakeholders from
any victimisation on raising concerns of any violations of legal
or regulatory requirements, incorrect or misrepresentation of
any financial statements and reports, and so on. The employees
of the Company have the right/option to report their concern/
grievance to Chairperson of the Audit Committee.

The Company is committed to adhere to the highest standards
of ethical, moral and legal conduct of business operations. The
Vigil Mechanism Policy is hosted on the Company's website
https://www.baluindustries.com/corporateqovernance.php

INTERNAL FINANCIAL CONTROL SYSTEMS AND
THEIR ADEQUACY

The Company's internal control system has been established
on values of integrity and operational excellence and it supports
the vision of the Company "To be the most sustainable and
competitive Company in our industry". The Company's internal
control systems are commensurate with the nature of its
business and the size and complexity of its operations.

The details of the internal financial control systems and their
adequacy are included in the Management Discussions and
Analysis Report, which forms part of the Annual Report.

AUDITORS AND REPORTS

The matters relating to the Auditors and their
Reports are as under:

Statutory Auditors

In accordance with provisions of Section 139 of the Companies
Act, 2013 and the Companies (Audit and Auditors) Rules, 2014,
M/s. M. B. Agrawal & Co. (Firm Registration Number 100137W)
will complete their term as Statutory Auditors of the Company
at the conclusion of the forthcoming AGM.

Considering their expertise and experience, the Audit Committee
and the Board of Directors of the Company, have approved and
recommended the re-appointment of M/s. M. B. Agrawal & Co.
(Firm Registration Number 100137W), Chartered Accountants
as the Statutory Auditors of the Company for the second term
of 5 (five) consecutive years from conclusion of this 36^th Annual
General Meeting of the Company until the conclusion of the 41^st
Annual General Meeting subject to approval of the shareholders.

Pursuant to Section 139 of the Companies Act, 2013 (the Act)
and the Rules framed thereunder, the Company has received
written confirmation from M/s. M. B. Agrawal & Co. and a
certificate that they satisfy the criteria provided under Section
141 of the Act and that the appointment, if made, shall be in
accordance with the applicable provisions of the Act and
Rules framed thereunder. As required under the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015,
M/s. M. B. Agrawal & Co., has confirmed that they hold a valid
certificate issued by the Peer Review Board of ICAI.

The Report given by M/s. M. B. Agrawal & Co., Statutory Auditors
on the financial statements of the Company is part of the Annual
Report. There has been no qualification, reservation, adverse
remark or disclaimer given by the Auditors in their Report.

Internal Auditors

The Company has in place a robust Internal Control System
and ably supported by reputed independent firm i.e. M/s. Mehta
Singhvi & Associates, Chartered Accountants, Mumbai as the
Internal Auditors. The audit conducted by the Internal Auditors
is based on an internal audit plan, which is reviewed each
year in consultation with the Audit Committee. These audits
are based on risk based methodology and inter-alia involve
the review of internal controls and governance processes,
adherence to management policies and review of statutory
compliances. The Internal Auditors share their findings on an
ongoing basis during the year for corrective action.

During the year the Board of Directors has re- appointed
M/s Mehta Singhvi & Associates, Chartered Accountants
(Registration No. 12221 7W) as Internal Auditors of the
Company. The audit conducted by the Internal Auditors is
based on an internal audit plan, which is reviewed each year in
consultation with the Audit Committee. These audits are based
on risk- based methodology and inter-alia involve the review
of internal controls and governance processes, adherence to
management policies and review of statutory compliances.

Report of the Internal Auditors for the FY 2024-25 does
not contain any qualification, reservation, disclaimer or
adverse remarks.

Cost Auditors

The provisions of Section 148(1) of the Companies Act, 2013
are applicable to the Company and accordingly the Company
has maintained cost accounts and records in respect of the
applicable products for the year ended 31^st March 2025.

The Board, on the recommendation of the Audit Committee, at its
meeting held on 14^th May, 2025, has approved the appointment
of M/s. S K Agarwal & Associates, Cost and Management
Consultants, as the Cost Auditors for the Company for the
financial year ending 31^st March 2026, at a remuneration of
H 3 Lakhs plus taxes and out of pocket expenses. They have
confirmed that they are free from any disqualifications under
Section 141 of the Companies Act, 2013.

A proposal for ratification of remuneration of the Cost Auditor
for the FY 2025-26 is placed before the Shareholders for
approval in the ensuing AGM.

Secretarial Auditors

Pursuant to the amended provisions of Regulation 24A of
the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and Section 204 of the Companies Act,
2013, read with Rule 9 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Audit
Committee and the Board of Directors have approved and
recommended the appointment of M/s. Prachi Bansal and
Associates, Practicing Company Secretaries (Firm Registration

Number: I2020HR2093500) as the Secretarial Auditors of the
Company for a term of 5 (Five) consecutive years from the FY
2025-26 till FY 2029-30, subject to the approval of the Members
at ensuing AGM.

Brief profile and other details of M/s. Prachi Bansal and
Associates, Practicing Company Secretaries, are disclosed in
the AGM Notice approved by the Board. They have given their
consent to act as Secretarial Auditors of the Company and have
confirmed their eligibility for the appointment.

The Secretarial Auditors have confirmed that they have
subjected themselves to the peer review process of Institute
of Company Secretaries of India (ICSI) and hold valid certificate
issued by the Peer Review Board of the ICSI.

The Secretarial Audit Report pursuant to the provisions
of Section 204 of the Companies Act, 2013 and Rule 9 the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, issued by M/s. Singhvi & Associates,
Company Secretaries, in form MR-3 for FY 2024-25 is attached
as Annexure ‘D' forming part of this Report. The Secretarial
Audit Report does not contain any qualification, reservation or
disclaimer or adverse remark.

Reporting of fraud by auditors

During the year under review, the Auditors of the Company have
not reported any fraud as specified under Section 143(12) of the
Act to the Audit Committee.

OTHER DISCLOSURES
Annual Return

In terms of Section 92(3) of the Companies Act, 2013 read
with Section 134(3)(a) of the Companies Act, 2013, the Annual
Return of the Company as on 31^st March 2025 is available on
the Company's website at https://www.baluindustries.com.

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

The Company has strong commitment towards conservation of
energy, natural resources and adoption of latest technology in
its areas of operation. The particulars relating to conservation
of energy, technology absorption, foreign exchange earnings
and outgo, as required to be disclosed under clause (m) of sub¬
section (3) of Section 134 of the Act read with Rule 8 of the
Companies (Accounts) Rules, 2014, is annexed to this Report
as "Annexure-E

Report on Corporate Governance

In terms of Regulation 34 of SEBI (LODR) Regulations, a separate
section on Corporate Governance with a detailed report on
Corporate Governance is provided as a separate section in the
Annual Report and a certificate from Mohammed Aabid, Partner
of M/s. Aabid & Co., Practicing Company Secretaries, is certifying
compliance of conditions of Corporate Governance as stipulated

under the Listing Regulations, forms part of this Annual Report.
The Report on Corporate Governance also contains disclosures
as required under the Companies Act, 2013.

Business Responsibility and Sustainability Report (BRSR)

In accordance with the provisions of Regulation 34 of
the Listing Regulations, the Business Responsibility and
Sustainability Report (BRSR) forms a part of this Annual Report
describing the initiatives undertaken by the Company from an
environmental, social and governance perspective during the
year under review.

Management Discussion Analysis Report

The Management Discussion and Analysis Report for the year
under review, as stipulated under regulation 34 (3) and Part
B of schedule V of the SEBI (Listing Obligation and Disclosure
Requirement) Regulation, 2015 is provided as a separate
section in the Annual Report.

Secretarial Standards Compliance

During the year under review, the Company has complied with
all the applicable Secretarial Standards issued by The Institute
of Company Secretaries of India and approved by the Central
Government pursuant to Section 118 of the Companies Act, 2013.

Disclosures as per the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act,
2013

The Company has zero tolerance for sexual harassment at
workplace and has adopted a policy on prevention, prohibition
and redressal of sexual harassment at workplace in line with the
provisions of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and the rules
thereunder for prevention and redressal of complaints of sexual
harassment at workplace. The Company has complied with
provisions relating to the constitution of Internal Complaints
Committee under the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The details of complaints reported under Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 during FY 2024-25 are as follows:

Adherence to provisions of the Maternity Benefit Act,
1961:

The Company has complied with the applicable provisions
of the Maternity Benefit Act, 1961, including those relating to
maternity leave, benefits, and safeguards for female employees.

GENERAL

Your Directors state that no disclosure or reporting is required

in respect of the following items as there were no transactions

for the same during the year under review:

1. Material Changes and/or commitment that could affect
the Company's financial position, which have occurred
between the end of the financial year of the Company and
the date of this report;

2. Significant or material orders passed by the Regulators or
Courts or Tribunals, impacting the going concern status
and Company's operations in future;

3. Non-exercising of voting rights in respect of shares
purchased directly by employees under a scheme
pursuant to Section 67(3) of the Companies Act, 2013
read with rules 16(4) of Companies (Share Capital and
Debentures) Rules, 2014;

4. Receipt of any remuneration or commission from any of
its subsidiary companies by the Managing Director or the
Whole-Time Directors of the Company;

5. Revision of the financial statements pertaining to previous
financial periods during the financial year under review;

6. Frauds reported as per Section 143(12) of the
Companies Act, 2013;

7. The details of application made or any proceeding pending
under the Insolvency and Bankruptcy Code, 2016 (31 of

2016) during the year along with their status as at the end
of the financial year;

8. The details of difference between amount of the valuation
done at the time of one-time settlement and the valuation
done while taking loan from the Banks or Financial
Institutions along with the reasons thereof.

ACKNOWLEDGEMENTS

Your Board takes this opportunity to thank Company's
employees at all levels for their hard work and commitment.
Your Board also places on record its sincere appreciation for
the continued support received from the customers, members,
suppliers, bankers, financial institutions and all other business
partners/associates.

By Order of the Board
For Balu Forge Industries Limited

Sd/-

Jaspalsingh Chandock

Date: 4^th September 2025 Place: Mumbai

DIN No.: 00813218 Chairman and Managing Director

Registered Office:

506, 5^th Floor, Imperial palace,

45 Telly Park Road, Andheri (East),

Mumbai. 400069. Maharashtra. India