The Board of Directors is pleased to present your Company's Forty-first Annual Report along with the Audited Financial Statements
for the Financial Year ended March 31, 2026.

FINANCIAL HIGHLIGHTS

Your Company's financial performance for the Financial Year ended March 31, 2026 is summarized below:

(Rs. in million)

Financial

The Company continued to strengthen its position and has
reported strong operational and financial performance across
all four quarters this year. The Total Income of the Company
increased by 56.9%, reaching Rs.26,394 million on a standalone
level and by 60.3%, reaching Rs.28,124 million on a consolidated
level. This growth was driven by our robust asset portfolio,
disciplined cost management, and a focused approach to
maximizing revenue across all assets. Hospitality Revenue of
Rs.17,311 million contributed to 61.6% of Total Revenue, Rental
& Annuity Revenues at Rs.3,061 million contributed to 10.9% of
the Company's Total Revenue and Revenue from Real Estate at
Rs.7,383 million contributed to 26.3% of the Company's Total
Revenue for the Financial Year ended March 31, 2026. The Net
Profit after Tax of the Company stood at Rs.6,654 million as
compared to Rs.1,716 million for the previous year.

A detailed analysis of the business and financial performance
is included in the Management Discussion and Analysis report
which forms a part of this Annual Report.

APPROPRIATIONS / DIVIDEND

The Company has adopted a Dividend Distribution Policy,
setting out the broad principles for guiding the Board and
Management in the matters concerning declaration and
distribution of dividend pursuant to Regulation 43A of the
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ('Listing Regulations'). The same is annexed
as Annexure I hereto and is also available on the Company's
website at www.chalethotels.com/wordpress/wp-content/
uploads/2023/11/Dividend-Distribution-Policy.pdf.

In line with the Dividend Distribution Policy and considering
the Company's performance, the Board of Directors on
November 4, 2025, declared an Interim Dividend of 10% i.e.

Re.1 per Equity Share of Rs.10 each. The said Interim Dividend
was paid to the shareholders of the Company on November
24, 2025.

Further, the Board of Directors at its meeting held on May 14,
2026 has recommended a final dividend of Re.1 per Equity
Share, which is proposed for approval of the shareholders at
the forthcoming Annual General Meeting ('AGM') and will be
paid thereafter.

Further, an amount of Rs. 6,655.60 million has been transferred
to Retained Earnings for the year under review.

Pursuant to the applicable provisions of the Companies
Act, 2013 ('the Act'), read with the Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and
Refund) Rules, 2016 ('the IEPF Rules'), all unpaid or unclaimed
dividends are required to be transferred by the Company
to the IEPF; established by the Government of India, after
completion of seven years. Further, according to IEPF Rules,
the shares on which dividend has not been paid or claimed by
the shareholders for seven consecutive years or more are also
required to be transferred to the demat account of the IEPF
Authority. The details of unclaimed dividend are available on
the Company's website at www.chalethotels.com/unclaimed-
dividend/. The Company was not required to transfer any
amount of dividend or shares to IEPF during the year under
review.

BUSINESS UPDATE
Brand Launch

During the year under review, the Company launched its own
premium lifestyle hospitality brand by the name 'ATHIVA®',
marking yet another initiative in the Company's scaling
strategy. ATHIVA made its debut with the transformation of the

iconic The Dukes Retreat in Khandala to ATHIVA Resort & Spa,
Khandala featuring 147 rooms. The transformation involved
an addition of 67 new rooms and a complete makeover of all
areas of the property including the existing rooms.

Expansion/Milestones

Driven by a focused growth strategy, the Company continues to
expand its geographic footprint and pursue new opportunities,
both greenfield and brownfield. The year under review marked
three significant initiatives, underscoring the strength of the
Company's growth trajectory, as detailed below:

> entered into a Binding Term Sheet for acquisition of
Lakeview Mercantile Company Private Limited with
the potential to develop a ~170 room luxury resort at
Bambolim in Goa.

> entered into a Memorandum of Understanding for a
warm-shell lease of a building at Madhapur in Hyderabad
for development of a proposed ~330 room Luxury Hotel
along with some commercial/retail space.

> entered into a Binding Term Sheet for acquisition of
Seasons Hotels Private Limited, which owns a resort
property at Udaipur in Rajasthan with around 150 rooms;
and the acquisition was completed post the end of the
Financial Year.

Further, Courtyard By Marriott Aravali Resort, NCR, a 158-
room hotel owned by the Company's wholly-owned LLP i.e.
Ayushi and Poonam Estates LLP, was upgraded and rebranded
as Aravali Marriott Resort & Spa, Delhi NCR.

During the year under review, the Company added 129
additional rooms at Bengaluru Marriott Hotel Whitefield. The
Company also has recognised total revenue of Rs.7,383.12
million from its Residential project at Bengaluru viz. Raheja
Vivarea, Koramangala and has completed handover of 152
units.

The number of keys of the Company and its subsidiaries
stands at 3,389 as on March 31, 2026.

DEVELOPMENT PIPELINE

The Company is working on various projects that are at
different stages of completion towards capacity addition as
well as upgradation of existing assets. Currently, work is in
progress in respect of ~276 room hotel at Airoli, Navi Mumbai,
a ~190 room resort at Varca in Goa, a ~385-390 room hotel
at Terminal 3, Delhi International Airport, a ~330 room Luxury
Hotel along with commercial/retail space of ~36,255 sq. ft. at
Madhapur in Hyderabad, a ~150 room resort and Convention
Centre in Kerala and a ~144 room premium resort at Udaipur.
In the Rental & Annuity space, construction work at the
CIGNUS Powai® Tower 2 has been progressing significantly
and is expected to be completed in FY 2027.

Further, 9 towers of the residential project at Koramangala,
Bengaluru have been completed and handed over. Construction
work on Phase 2 of the residential towers and the commercial
building is underway. The Company would be leasing the
commercial building post completion of construction and
receipt of necessary statutory approvals.

CAPITAL STRUCTURE
Authorised Share Capital

During the year under review, there was no change in the
Authorised Share Capital of the Company. The Authorised
Share Capital of your Company as on March 31, 2026 is
Rs.5,981,000,000 consisting of 38,21,00,000 Equity Shares

of Rs.10 each amounting to Rs.382,10,00,000 and 21,600
Preference Shares of Rs.1,00,000 each amounting to
Rs.216,00,00,000.

Paid-up Equity Share Capital

During the year under review, the Paid-up Equity Share
Capital of your Company increased by Rs.53,87,120 from
Rs.218,45,54,150 to Rs.218,99,41,270, on account of exercise
of 5,38,712 Stock Options.

The Paid-up Equity Share Capital of your Company as
on March 31, 2026 stands at Rs.218,99,41,270 comprising
of 21,89,94,127 Equity Shares of Rs.10 each.

Paid-up Preference Share Capital

Your Company had entered into a Subscription Agreement
dated June 04, 2018 with Mr. Ravi C. Raheja and Mr. Neel C.
Raheja, Promoters of the Company, wherein they had agreed
to provide your Company with funds required to meet any
costs, expenses and liabilities pertaining to the Koramangala
Residential project, by way of subscription by themselves
or by their Designated Nominees to 20,000 Zero Coupon
Non-Cumulative, Non-Convertible, Redeemable Preference
Shares ('NCRPS/'Subscription Securities') of Rs.100,000 each
in two series (viz. Series A and Series B) of 10,000 NCRPS
each, aggregating to Rs.2,000 million (Initial Subscription
Amount). The Company with the consent of the Preference
Shareholders and pursuant to the approval of the Board of
Directors, redeemed entire 20,000, NCRPS having a Face
Value of Rs.1,00,000 each amounting to Rs.200,00,00,000
during the year under review.

BORROWINGS

The Company avails credit facilities from time to time,
inter-alia for purposes such as capital expenditure, working
capital requirements and repayment of high cost debt. During
the year under review, the Company availed of additional
borrowings amounting to Rs.14,307 million and repaid Rs.14,932
million existing debt. As on March 31, 2026, the Company's
borrowing stood at Rs.20,613 million on a standalone basis
and at Rs.23,239 million on a consolidated basis, as compared
to Rs.20,908 million on a standalone and Rs.23,574 million on
a consolidated basis (excluding Preference Share Capital and
Loan from Promoter-Directors, amounting to Rs.1,969 million)
as at March 31, 2025.

Debentures

The Company has the following Debentures outstanding as on
March 31, 2026:

- 7,500, 8.35% Listed, Rated, Secured, Non-Cumulative,
Taxable, Transferrable, Redeemable, Non-Convertible
Debentures having a Face Value of Rs.1,00,000

- 2,000 Secured, Unlisted, Non-rated, Non-cumulative,
Redeemable and Non-Convertible Debentures having a
Face Value of Rs.1,00,000

The Company has been regular in servicing interest and
repayment of principal (as applicable) on these Debentures as
per the terms of their issue.

Commercial Paper

During the year under review, the Company issued two
tranches of Listed, Rated, Taxable, Transferable Commercial
Paper ('Listed CPs') having a Face Value of Rs.5,00,000 each
amounting to Rs.1,000 million each listed on BSE Limited.

The Company has redeemed both the tranches of Listed CPs
on their respective maturity dates.

Credit Ratings

The Company had the following Credit Ratings as on March 31, 2026:

DEPOSITS

Your Company has neither accepted nor renewed any amount
falling within the purview of provisions of Section 73 of the
Act read with the Companies (Acceptance of Deposits) Rules,
2014 during the year under review. As such, no amount on
account of principal or interest on deposits from public was
outstanding as on the date of the Balance Sheet.

LOANS, INVESTMENTS, GUARANTEES AND SECURITIES

Your Company is engaged in 'infrastructural activities' covered
under Schedule VI of the Act and is therefore exempt from the
provisions of Section 186 of the Act with regards to Loans,
Investments, Guarantees and Securities. Details of loans
given, guarantee and security provided in connection with loan
and investments made by your Company are given in Note 61
of the Standalone Financial Statements.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the year under review, your Company earned foreign
exchange of Rs.4,510 million as compared to Rs.6,112 million in
the previous year.

The foreign exchange outgo of your Company during the year
under review was Rs.1,660 million as compared to Rs.1,630
million in the previous year.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

The Company has six subsidiaries and five associates as on
the date of this Report. There has been no material change in
the nature of the business of the subsidiaries. The Company
does not have any Joint Venture.

Brief updates / description in relation to each subsidiary for
the year under review are as given below:

- Chalet Airport Hotel Private Limited ('CAHPL') is
developing a ~385-390 room hotel at Terminal 3 at
Delhi International Airport which is to be branded as 'Taj'
under a Franchise and Technical Services & Development
Assistance Agreement entered into with The Indian
Hotels Company Limited. The interior design and
finishing works for the public areas, guest rooms, and
back-of-house facilities are well underway. Additionally,
the fagade works have been completed up to the fourth
floor.

- The Dukes Retreat Private Limited ('Dukes') is the owner
and operator of the 147 room full service resort viz.
Athiva Resort & Spa, Khandala.

- Sonmil Industries Private Limited ('Sonmil') owns the land
on which Athiva Resort & Spa, Khandala is situated.

- Mahananda Spa and Resorts Private Limited owns The
Westin Resort & Spa, Himalayas, a 141 room hotel at
Rishikesh in the state of Uttarakhand.

- Ayushi and Poonam Estates LLP owns the 158 room
rebranded Aravali Marriott Resort & Spa, Delhi NCR, in
the National Capital Region (NCR).

- Chalet Hotels & Properties (Kerala) Private Limited is
an SPV set up for developing a Convention Centre at
Thiruvananthapuram in the state of Kerala - the Company
had insignificant operations during the year under review.

The Board of Directors of the Company had approved the
amalgamation of Sonmil and Dukes, which are wholly owned
subsidiary and subsidiary of the Company respectively, with
the Company, which inter-alia aims at simplified corporate
structure, synergy in operations, greater financial strength
and improvement in the position of the merged entity.
Thereafter, the Company had filed a Scheme of Arrangement
and Amalgamation of Sonmil and Dukes with the Company.
Pursuant to the Order dated March 18, 2025 passed by the
Hon'ble National Company Law Tribunal, Mumbai Bench
('Hon'ble NCLT'), a meeting of the Equity Shareholders of the
Company was held on May 13, 2025 and the Members of the
Company approved the same. Approval of the Hon'ble NCLT is
awaited in the said matter.

As at the end of the year under review, the Company has one
material subsidiary, i.e. Mahananda Spa and Resorts Private
Limited. The policy for determining material subsidiaries has
been disclosed on the Company's website athttps://www.
chalethotels.com/wordpress/wp-content/uploads/2025/02/
Policy-for-Determination-of-Material-Subsidiaries-29012025-
website.pdf.

In terms of provisions of Section 136 of the Act, the Audited
Financial Statements of the subsidiary companies can
be accessed on the website of the Company viz. www.
chalethotels. com/annual-reports/.

During the year under review, the Company acquired stake
in Vikramaditya Renewable Energy Private Limited and Pro¬
Zeal Green Power Fourteen Private Limited, for the purpose
of securing the supply of renewable energy for captive
consumption, thereby making these two entities as Associates
of the Company.

Your Company holds more than 20% of the Equity Share Capital
of Krishna Valley Power Private Limited, Sahyadri Renewable
Energy Private Limited, TP Agastaya Limited, Vikramaditya
Renewable Energy Private Limited and Pro-Zeal Green Power
Fourteen Private Limited, being entities engaged in generation
of hydropower and solar power thereby making them associate
companies. Your Company continues to hold the aforesaid
securities, however it does not have the ability to participate
and neither is involved in the operations and/ or relevant
activities of these companies/ entities, nor has exposure or
rights to variable returns. Hence, the aforementioned entities
have not been considered as Associate companies in the
consolidation of Financial Statements.

The Consolidated Financial Statements of your Company and
its Subsidiaries, prepared in accordance with the relevant
Accounting Standards, duly audited by the Statutory Auditors,
form part of this Annual Report. The statement under Rule 5 of
the Companies (Accounts) Rules, 2014 relating to Subsidiaries
and Associates in Form AOC-1 is annexed as Annexure II to
this Report.

MANAGEMENT DISCUSSION & ANALYSIS, CORPORATE
GOVERNANCE AND BUSINESS RESPONSIBILITY &
SUSTAINABILITY REPORTS

A detailed note on the state of the Company's affairs is
covered in the Management Discussion & Analysis section of
the Annual Report.

Your Company has complied with the Corporate Governance
requirements under the Act and Listing Regulations, the details
of which are mentioned in a separate section viz. Report on
Corporate Governance.

Further, the Business Responsibility & Sustainability Report,
also forms an integral part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors comprises distinguished professionals
of proven integrity and competence, who provide strategic
direction, guidance and leadership to the Company. The
composition of the Board is in accordance with the provisions
of Section 149 of the Act and Regulation 17 of the Listing
Regulations, with an appropriate combination of Executive
Director, Non-Executive Directors and Independent Directors.
The brief details about them have been disclosed in the
Corporate Governance Report forming part of the Annual
Report.

The Board of Directors appointed Mr. Manish Chokhani
(DIN: 00204011) as an Independent Director of the Company
for a period of five years with effect from June 20, 2025,
on the basis of the recommendation of the Compensation,
Nomination and Remuneration ('CNR') Committee at their
respective meetings held on June 20, 2025. The Members of
the Company approved the said appointment in the AGM held
on August 8, 2025.

The Board of Directors at its meeting held on December
11, 2025, on the basis of the recommendation

of the CNR Committee at its meeting held on
December 10, 2025, appointed Mr. Shwetank Singh
(DIN: 02976637) as the Managing Director and CEO for a

period of three years w.e.f February 1, 2026; and Dr. Sanjay
Sethi (DIN: 00641243) as a Non-Executive Director with effect
from February 1, 2026, post his retirement from the services of
the Company as Managing Director and CEO of the Company
on January 31, 2026. The said appointments were approved
by the Members of the Company through Postal Ballot on
January 30, 2026. The Board places on record its sincere
gratitude for the time, effort, contribution and services
provided by Dr. Sethi during his tenure as the Managing
Director and CEO of the Company.

In accordance with the Act and the Articles of Association of
the Company, Mr. Ravi Raheja (DIN: 00028044) is liable to retire
by rotation and being eligible, has offered his candidature for
re-appointment. Accordingly, the re-appointment of Mr. Ravi
Raheja is being placed for approval of the Members at the
ensuing AGM. The information pertaining to the Director being
re-appointed as required pursuant to the Listing Regulations
and Secretarial Standard-2, forms part of the Notice convening
the AGM.

Except as stated above, there were no other changes in the
Directors and Key Managerial Personnel of the Company
during the year under review.

During the year under review, none of the Non-Executive
Directors of the Company had any material pecuniary
relationship or transactions with the Company, other than
receipt of Sitting Fees towards attending meetings of Board
of Directors and / or Committees thereof. Further, pursuant to
the approval of the Members of the Company through Postal
Ballot on January 30, 2026, the Independent Directors of the
Company will be paid Commission for the Financial Year 2026.

ANNUAL RETURN

As provided under Sections 92(3) and 134(3)(a) of the
Act, read with Rule 12 of the Companies (Management and
Administration) Rules, 2014, as amended from time to time, the
draft Annual Return of your Company in Form MGT-7 for the
Financial Year 2026, is hosted on the website of your Company
at www.chalethotels.com/annual-reports/.

NUMBER OF BOARD MEETINGS

During the Financial Year 2026, the Board of Directors met
eight times. The details of the meetings held have been
provided in Corporate Governance Report.

DIRECTORS' RESPONSIBILITY STATEMENT

On the basis of internal financial control framework and
compliance systems in place and the work carried out by the
Internal and Statutory Auditors, including audit of internal
financial controls over financial reporting and internal reviews
performed by the Management and the Audit Committee, the
Board is of the opinion that your Company's internal financial
controls were reasonable and adequate for the Financial Year
2026.

Accordingly, pursuant to Section 134(5) of the Act, the Board
of Directors, to the best of their knowledge and ability, confirm
that:

(i) In the preparation of the accounts for the Financial
Year ended March 31, 2026, the applicable Accounting
Standards have been followed along with proper
explanation relating to material departures;

(ii) The Board of Directors have selected such accounting
policies and applied them consistently and made
judgments and estimates that were reasonable and
prudent in order to give a true and fair view of the state

of affairs of your Company at the end of the Financial
Year and of the profit of your Company for the Financial
Year ended March 31, 2026;

(iii) The Board of Directors have taken proper and
sufficient care to the best of their knowledge and
ability for the maintenance of adequate accounting
records in accordance with the provisions of the Act,
for safeguarding the assets of your Company and for
preventing and detecting fraud and other irregularities;

(iv) The Financial Statements for the Financial Year ended
March 31, 2026 have been prepared on a 'going concern'
basis;

(v) The Board of Directors have laid down internal financial
controls for your Company which it believes are adequate
and are operating effectively; and

(vi) The Board of Directors have devised proper systems to
ensure compliance with the provisions of all applicable
laws and such systems are adequate and are operating
effectively.

GOING CONCERN

The Company continues to deliver strong performance backed
by robust operational strategies, resulting in improving Key
Performance Indicators such as occupancy rates, Average
Daily Rate (ADR), and Revenue Per Available Room (RevPAR).
Also, leasing of the Rental and Annuity premises has further
reinforced the Company's revenues. The Company continues
to adopt prudent cash flow management and implements
various processes to tighten, control and manage costs and
deliver improved margins. All monetary obligations for the
Company were met out of cash generated from operations.
Accordingly, the Financial Statements for the year under review
have been prepared on a Going Concern basis. The nature of
the Company's business and activities has not undergone any
change during the year under review.

ACCOUNTING TREATMENT

The accounting treatment adopted by the Company is in
line with applicable Indian Accounting Standards ('Ind AS')
recommended by The Institute of Chartered Accountants of
India and prescribed by the Central Government in accordance
with Section 133 of the Act.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS
INCLUDING REFERENCE TO THE FINANCIAL STATEMENTS

The Internal Financial Control Systems including the Internal
Audit and Internal Controls are commensurate with the size
and scale of your Company's operational and commercial
activities.

The managed hotels are operated through globally reputed
hospitality companies which have their respective internal
control systems in place. Your Company has provided an
adequate system of internal control covering the franchise
hotel, the Rental and Annuity business, residential business,
projects under development as well as all corporate functions.
The internal control systems provide assurance regarding the
effectiveness and efficiency of operations, safeguarding of
assets, reliability on financial controls and compliance with
applicable laws.

No material frauds were detected by the Company during the
year under review.

Based on the recommendation of the Audit Committee,
the Board has approved the re-appointment of
M/s. PriceWaterhouse Coopers Services LLP and appointment

of RSM Astute Consulting Private Limited as Internal Auditors
of the Company for the Financial Year 2027. The Chief Internal
Auditor who reports to the Audit Committee oversees the
Internal Audit function of the Company. The reports by the
Internal Auditors are placed before the Audit Committee for
their review and improvements.

AUDITORS & AUDITORS' REPORT
Statutory Audit

The Audit Committee and the Board of Directors at their
respective meetings held on May 10, 2022 approved the re¬
appointment of M/s. B S R & Co. LLP, Chartered Accountants
(Firm Registration No. 101248W/W-100022) as the Statutory
Auditors of the Company for a second term of five years i.e.
from the conclusion of the 37th AGM till the conclusion of the
42nd AGM, which was also approved by the Members at the
37th AGM of the Company held on September 14, 2022.

The Report of the Statutory Auditors along with its Annexures
forms a part of this Annual Report. The Auditors' Report to the
Members on Financial Statements for the year under review
was issued with an unmodified opinion.

Explanation or Comments on Qualifications, Reservations,
Adverse Remarks or Disclaimers made by the Auditors

There are no qualifications, reservations or adverse remarks
or disclaimers made by Statutory Auditors in their report on
the Financial Statements for the Financial Year 2026. However,
the Statutory Auditors have drawn attention i.e. Emphasis of
Matter with regard to Note 43(A)(c) of the Standalone Financial
Statements, in their report, details of which are as follows:

"Emphasis of Matter

We draw attention to Note 43(A)(c) to the standalone financial
statements that explains the ongoing litigation in respect of
leasehold rights to land and building at Vashi (Navi Mumbai)
purchased from K Raheja Corp Private Limited ('K Raheja'),
on which the Company's hotel, Four Points by Sheraton has
been built. As at 31 March 2026, the matter continues to
be pending before the Supreme Court. Accordingly, there
remains uncertainty regarding the imposition of any penalty
on the Company and its quantum, if any. In earlier years, based
on two public interest litigations, the Honourable High Court of
Bombay ordered K Raheja to demolish the structure and hand
back the land to City & Industrial Development Corporation
('CIDCO'). In response, K Raheja filed a special leave petition
(SLP) against the order in the Honourable Supreme Court of
India ('Supreme Court') which directed maintenance of status
quo vide its order dated 21 January 2015 and ordered that the
interim orders remain in force until further hearings. Pursuant
to the Supreme Court's order dated 27 October 2025, the SLP
filed by K Raheja was converted into Civil Appeals, and CIDCO
was directed to file an affidavit on steps taken regarding
regularisation. Subsequently, CIDCO, through Board Resolution
No. 13178 dated 4 February 2026, approved regularisation
of the allotment, subject to payment of differential premium,
interest and taxes and placed the same on record before the
Court vide affidavit dated 9 March 2026.

Pending the final outcome of proceedings and basis legal
advice obtained, no adjustments have been made to the
standalone financial statements as at 31 March 2026.

Our opinion is not modified in respect of this matter.

The Auditors have clarified that their opinion is not modified in
respect of the above matter. Detailed explanation in respect
of the matter has been provided under Note 43(A)(c) of the
Standalone Financial Statements and are self-explanatory.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act read with
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Board of Directors had appointed
M/s. KDA & Associates, Company Secretaries in Practice,
to undertake Secretarial Audit for a term of five years from
Financial Year 2026 to Financial Year 2030 and was approved
by the Members of the Company in the AGM held on August
8, 2025. The Secretarial Audit Report issued by them is
annexed herewith as Annexure IV. There are no qualifications,
reservations, adverse remarks or disclaimers in the report.
Pursuant to Regulation 24A(1) of the Listing Regulations, the
Secretarial Audit Report of Mahananda Spa and Resort Private
Limited, the Company's material unlisted Indian subsidiary for
Financial Year 2026, is annexed as Annexure V.

No other subsidiary of the Company meets the criteria
for material unlisted subsidiaries as per the provisions of
Regulation 24A of the Listing Regulations.

Cost Audit

Your Company has been maintaining cost accounting records
as specified by the Central Government under Section 148 of
the Act read with the Companies (Cost Records and Audit)
Rules, 2014. Further, your Company was also required to
conduct an audit of cost records as specified by the Central
Government under Section 148 of the Act and the Rules
framed thereunder for the Financial Year under review. The
Board of Directors appointed M/s. Chirag Trilok Shah & Co.,
Practicing Cost Accountant (Membership Number 23277 and
Firm Registration Number 004442) as the Cost Auditor for
conducting the audit of cost records for the Financial Year
2026, at the remuneration approved by the Members at the
previous AGM.

There are no qualifications, reservations, adverse remarks or
disclaimers in the report.

During the year under review, none of these Auditors have
reported any fraud and therefore no details are required to be
disclosed under Section 134(3)(ca) of the Act.

BOARD EFFECTIVENESS AND BOARD EVALUATION

Pursuant to Section 134(3)(p) of the Act, as amended
from time to time, and Regulations 17 and 25 of the Listing
Regulations, the Board of Directors had carried out an annual
evaluation of its own performance, individual directors and its
committees for the Financial Year under review. A structured
questionnaire was prepared after taking into consideration
the Guidance Note issued by SEBI on Board Evaluation,
covering various aspects of the Board's functioning such as
adequacy of the composition of the Board and its Committees,
Board culture, execution and performance of specific duties,
obligations and governance. The feedback and suggestions
received have been discussed by the Independent Directors,
CNR Committee and the Board of Directors at their respective
meetings. The Directors expressed their satisfaction with the
evaluation process.

INDEPENDENT DIRECTORS

All the Independent Directors have confirmed that they meet
the criteria of independence as laid down under the Act and
Listing Regulations. They have declared that they do not suffer
from any disqualifications specified under the Act and are not
aware of any circumstances or situations which exist or may
be reasonably anticipated that could impair or impact the
ability to discharge their duties.

Based on such confirmations / declarations, in the opinion
of the Board, the Independent Directors of your Company
fulfill the conditions specified under the Act and the Listing
Regulations and are independent of the management of your
Company.

Further, all the Independent Directors have registered their
names in the databank of Independent Directors maintained by
the Indian Institute of Corporate Affairs and the Independent
Director to whom online self-assessment proficiency test was
applicable, has completed the same and in the opinion of the
Board, these Independent Directors possess the requisite
integrity, expertise and experience.

COMMITTEES

Your Company has constituted the following Committees of
the Board as per the requirements of the Act and the Listing
Regulations:

- Audit Committee;

- Compensation, Nomination and Remuneration
Committee;

- Corporate Social Responsibility and ESG Committee;

- Stakeholders' Relationship Committee; and

- Risk Management Committee.

The details of constitution, meetings held, attendance of the
members and terms of reference of the said Committees, have
been enumerated in the Corporate Governance Report which
forms a part of the Annual Report.

Policy on Compensation, Nomination and Remuneration

Your Company had in compliance with the provisions of
Section 178 of the Act and Regulation 19 of the Listing
Regulations, adopted a Policy for Appointment of Directors
and Remuneration of Directors & Senior Management.
The salient features of the said Policy are outlined in the
Corporate Governance Report. The same is available on the
website of your Company viz.https://www.chalethotels.
com/wordpress/wp-content/uploads/2025/02/Policy-for-
Appointment-of-Directors-Remuneration-of-Director-and-
Senior-Management-29012025-website.pdf.

The CNR Committee of your Company, while formulating the
above policy, has ensured that:

• the level and composition of remuneration be reasonable
and sufficient to attract, retain and motivate Directors/
employees of the quality required to run the Company
successfully;

• relationship of remuneration to performance is clear and
meets appropriate performance benchmarks; and

• remuneration to Directors, Key Managerial Personnel
and Senior Management involves a balance between
fixed and performance linked bonuses reflecting short
and long term performance objectives appropriate to the
working of the Company and its goals.

The remuneration / compensation / commission (including
annual increments, if any) paid to Directors and Senior
Management including KMP of the Company are determined
by the CNR Committee and are as per the terms laid down
in the said Policy. The Managing Director and CEO of your
Company does not receive remuneration or commission from
any of the subsidiaries of your Company.

Corporate Social Responsibility

Your Company had adopted a CSR Policy indicating the
Company's broad philosophy and objectives, which is available
on the website of your Company at www.chalethotels.com/
wordpress/wp-content/uploads/2021/09/CSR-Policy.pdf.
During the year under review, the Company has undertaken
CSR activities in line with its philosophy and objectives
and pursuant to the recommendation of the CSR and ESG
Committee and approval of the Board.

The annual report on CSR activities and details about the
composition of CSR and ESG Committee along with the
initiatives undertaken by the Company on CSR activities
during the year under review is annexed as Annexure III to this
Report.

EMPLOYEE STOCK OPTION SCHEME (ESOP)

During the year under review, the Company had the following
ESOP Schemes:

- CHL Employee Stock Option Plan 2022

- CHL Employee Stock Option Plan 2023

The applicable disclosures as stipulated under Securities and
Exchange Board of India (Share Based Employee Benefits and
Sweat Equity) Regulations, 2021 have been made available on
the website of the Company at www.chalethotels.com/annual-
reports/.

Further, a certificate from M/s. KDA & Associates, Secretarial
Auditors of the Company, with respect to implementation of
ESOP and confirming that the Schemes are in compliance
with the relevant SEBI Regulations and the Members approval
obtained; shall be available for inspection by Members of the
Company and is also available on the website of the Company
on www.chalethotels.com/annual-reports/.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH
RELATED PARTIES

In line with the requirements of the Act and in accordance with
the Listing Regulations, your Company has formulated a policy
on dealing with Related Party Transactions ('RPTs') which
is available on the website of the Company athttps://www.
chalethotels.com/wordpress/wp-content/uploads/2025/02/
CHL-Related-Party- Policy-29102025-website.pdf.

During the year under review, the transactions / contracts /
arrangements have been entered into by the Company with
related party(ies) were in ordinary course of business and
at arm's length upon seeking prior approval of the Audit
Committee and the Board of Directors of the Company, as
applicable in accordance with the provisions of the Act and
the Rules made thereunder and the Listing Regulations. The
disclosure in Form AOC-2 is not applicable to the Company
for the Financial Year 2026 and hence does not form part of
this Report.

Omnibus Approval is obtained for each financial year from the
Audit Committee in respect of Related Party Transactions which
are repetitive in nature or unforeseen, based on the criteria
specified and approved by the Board upon recommendation
of the said Committee. The Audit Committee and the Board
review transactions with related parties on a quarterly basis.
Further, during the year under review, there were no
transactions which were material in nature, considering the
aforesaid policy. There were no related party transactions that
may have potential conflict with the interest of your Company

at large or which warrants the approval of shareholders.
Members may refer to Note 51 to the Standalone Financial
Statement setting out the disclosures on related party
transactions for the year under review.

RISK MANAGEMENT

Your Company is faced with risks of different types, each
of which needs varying approaches for mitigation. The
risk management framework defines the risk management
approach across the enterprise. The risk framework which
seeks to create transparency, minimize adverse impact on
business objective and enhance your Company's competitive
advantage, is reviewed by the Risk Management Committee
periodically. An impact analysis of the identified risks including
risk mitigation approach and risk mitigation status is also done
at regular intervals taking into consideration the changing
business environment and additional steps taken by the
Company to further mitigate the risks.

Your Company has adopted a Risk Management Policy,
pursuant to the provisions of Section 134 of the Act, to
identify and evaluate business risks and opportunities for
mitigation of the same on a continual basis, which is available
on the Company's website athttps://www.chalethotels.com/
wordpress/wp-content/uploads/2021/12/Risk-Management-
Policy-renamed- as-on-October-28-2021.pdf.

Certain risks faced by your Company and measures for
mitigation have been provided in the Integrated Report which
is a part of the Annual Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has, in accordance with Section 177 of the Act
and Regulation 22 of the Listing Regulations, formulated a
Vigil Mechanism / Whistle Blower Policy for its Directors and
Employees, to enable reporting of any wrongdoing within the
Company / units that fall short of your Company's business
principles on ethics and good business practices.

Your Company's Vigil Mechanism / Whistle Blower Policy
provides a formal mechanism to the Directors, the employees
and other stakeholders of the Company to report their concerns
about unethical behavior, actual or suspected fraud or violation
of the Company's Code of Conduct. The said policy is available
on the Company's website athttps://www.chalethotels.com/
wordpress/wp-content/uploads/2024/08/Vigil-Mechanism-
and- Whistle-Blower-Policy-Rev-July252024.pdf.

The Policy provides adequate safeguards against victimization
of people who avail of the mechanism and have also provided
them direct access to the Chairperson of the Audit Committee.
Matters reported under the Vigil Mechanism are informed to
the Audit Committee from time to time. It is affirmed that no
personnel of the Company has been denied access to the
Chairperson of the Audit Committee.

PREVENTION OF SEXUAL HARASSMENT

Your Company has complied with provisions relating to the
constitution of Internal Complaints Committee in compliance
with the requirements of the Sexual Harassment of Women
at Workplace (Prevention, Prohibition & Redressal) Act, 2013
and the Rules framed thereunder in respect of the Corporate
Office and various units. The policy in this regard is available
on the Company's website athttps://www.chalethotels.com/
wordpress/wp-content/uploads/2025/06/POSH-Policy-Rev-
June-20-2025.pdf.

During the year under review, two complaints on sexual
harassment were received and four complaints have been
resolved, including two complaints from the previous year.
Appropriate actions were taken, wherever necessary. There
were two complaints pending for resolution for more than 90
days during the Financial Year 2026 and no complaints were
pending as on March 31, 2026. The Company also conducts
workshops from time to time to promote awareness on the
issue.

Your Company continues its strong stand against any kind
of sexual harassment and has zero tolerance for sexual
harassment at workplace.

DISCLOSURE OF MATERNITY BENEFIT COMPLIANCE

The Company has complied with the provisions relating to the
Maternity Benefit Act, 1961.

HUMAN CAPITAL INITIATIVES AND PARTICULARS OF
EMPLOYEES

Your Company focuses on building on its strength by
developing the capability of its employees, through training
and development and work life balance. During the year under
review, your Company has undertaken various initiatives
towards nurturing talent, keeping its people connected and
taking various steps for maintaining the physical and emotional
wellbeing of its employees.

Further, your Company has been listed as a Great Place to
Work ® Certified, for the seventh time in a row and certified
in the 2025 list of 'India's Best Workplaces™ for Women 2024
- Mid-size (Top 50).

The Government of India with effect from November 21, 2025,
consolidated 29 existing labour legislations into a unified
framework comprising four labour codes viz the Code on
Wages, 2019, the Code on Social Security, 2020, the Industrial
Relations Code, 2020, and the Occupational Safety, Health
and Working Conditions Code, 2020 ('Codes'). In accordance
with the Codes, the Company has currently estimated the
incremental impact on retiral benefits and the impact of the
Codes is recognised under Exceptional Items in the Financial
Statements for the year ended March 31, 2026. Accordingly,
adjustments have been recognised in respect of employee
benefit expenses in the year under review.

The disclosures pertaining to remuneration and other details
as required under Section 197(12) of the Act read with Rule
5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, is annexed to this Report
as Annexure VI.

Further, in terms of the provisions of Section 197(12) of the Act,
read with Rules 5(2) and 5(3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, a
statement showing the names and other particulars of the
employees drawing remuneration in excess of the limits set
out in the said Rules forms part of this Report.

Having regard to the provisions of the second proviso to
Section 136(1) of the Act, the Annual Report excluding the
aforesaid information is being sent to the Members of the
Company and others entitled thereto. Any Member interested
in obtaining such information may write to the Company
Secretary at companysecretary@chalethotels.com and the
same will be furnished on request. The Annual Report including
the aforesaid information is also available on the Company's
website.

ENVIRONMENTAL INITIATIVES AND ENERGY MANAGEMENT

During the year, the Company introduced Parivartan, a holistic
framework for sustainability and climate action that drives
systemic transformation in the way we design, develop and
operate. It is about creating enduring change by rethinking
values, systems, processes and behaviours to nurture
a thriving planet for present and future generations and
symbolizes the conscious shift towards a more responsible,
inclusive, and regenerative way of living and doing business.
The Company has committed to achieve Net Zero GHG
Emissions by 2040 and has developed a roadmap towards
achieving the same. During the year, the Company also made
progress towards its commitments to Climate Group's RE100,
EP100 and EV100 initiatives linked to renewable energy,
energy productivity and electric mobility respectively. The
Company has achieved its target of EV100 by providing EV
charging infrastructure and converting its guest fleet to EVs.

The Company has also made significant progress in ESG
rankings whereby Chalet ranked second globally with a score
of 82, marking an improvement across all three dimensions of
ESG in the Corporate Sustainability Assessment (CSA) 2025 by
S&P Global under Hotels, Resorts, and Cruise Lines category.
The Company also discloses its initiatives on environment
stewardship, employee and community well-being and
responsible business practices through its Integrated Report
section of this Annual Report and the Business Responsibility
and Sustainability Report.

As required under Section 134 of the Act read with Rule 8 of
Companies (Accounts) Rules, 2014, the information relating
to conservation of energy is annexed as Annexure VII to this
Report. The information relating to technology absorption is
not given since the same is not applicable to the Company.

INTEGRATED REPORT

Your Company has provided Integrated Report for the financial
year under review, which encompasses both financial and
non-financial information and stakeholders' relationships to
enable well informed decisions and a better understanding of
the Company's value creation model. The Report also touches
upon aspects such as organization's strategy, governance
framework, performance and prospects of value creation
based on the six forms of capital viz. financial, manufactured,
intellectual, human, social & relationship and natural capitals.
The Integrated Report also includes ESG parameters and
Company's performance vis- a-vis these.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY
REGULATORS, COURTS OR TRIBUNALS IMPACTING THE
GOING CONCERN STATUS AND COMPANY'S OPERATIONS
IN FUTURE

There were no significant and material orders passed by
Regulators, Courts or Tribunals impacting the Going Concern
status and Company's operations in future.

MATERIAL CHANGES AND COMMITMENTS

There have been no material changes and commitments
affecting the financial position of your Company, which have
occurred between the end of the Financial Year to which the
Financial Statements relate and the date of this Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

Your Company is in compliance with the applicable Secretarial
Standards, issued by The Institute of Company Secretaries of
India and approved by the Central Government under Section
118(10) of the Act.

GENERAL

Your Directors state that no disclosure or reporting is
required in respect of the following matters as there were no
transactions on these matters during the year under review:

- Issue of Equity Shares with differential rights as to
dividend, voting or otherwise.

- Issue of shares (including sweat equity shares) to
employees of the Company under any scheme save and
except Employees' Stock Option Schemes referred to in
this Report.

- Proceedings filed by or against the Company under the
Insolvency and Bankruptcy Code, 2016.

- Onetime settlement with any Bank or Financial Institution.
ACKNOWLEDGEMENTS

Your Directors would like to express their deepest appreciation
to the Members for their support received and their continued
confidence in the Company's vision and endeavors. Your
Directors extend their gratitude and sincerely appreciate the
assistance and co-operation received from the Regulatory
and Statutory Authorities, Government and its agencies, hotel
operating partners, Stock Exchanges, Depositories, lenders,
legal advisors, Registrar & Share Transfer Agent, Auditors,
vendors and other key stakeholders.

We are also immensely grateful to our Company's employees
at all levels whose hard work, expertise, and commitment are
the driving force behind our success.

For and on behalf of the Board of Directors of
Chalet Hotels Limited

Place: Mumbai Hetal Gandhi

Date: May 14, 2026 Chairperson and Independent Director

DIN: 00106895