Directors Report of Kapston Services Ltd.

Mar 31, 2025

The Board of Directors ("Board") of Kapston Services Limited ("Kapston" or "Company") have immense pleasure in
presenting the Seventeenth Annual Report on the business and operations of your company together with the
Audited (Standalone & Consolidated) Financial Statements for the financial year ended March 31, 2025. The
consolidated performance of the Company and its subsidiaries has been referred to wherever required.

1. FINANCIAL HIGHLIGHTS

The summarized Financial Statements of your Company are given in the following table:

Particulars	(INR in Lakhs, except per equity share data)
	Consolidated		Standalone
	2024-25	2023-24	2024-25	2023-24
Revenue from Operations	6,8943.16		68,870.17	52,008.06
EBITDA	3,175.01		3,175.04	2,413.99
Less: Finance Costs	1,221.58		1,221.55	1,059.79
Less: Depreciation and amortization expenses	449.47		449.47	361.71
Profit before prior period items	1,503.95		1,504.02	992.49
Prior period items	-		-	-
Profit before tax	1,503.95	NA*	1,504.02	992.49
Less: Current Tax	0.21		-	-
Deferred Tax	(279.90)		(279.36)	(264.58)
Profit Available for appropriations/Loss	1,783.6,5		1,783.38	1,257.07
Basic Earnings per Share (Rs.)	8.79		8.79	6.20/12.39¹
Diluted Earnings per Share (Rs.)	8.79		8.79	6.20/12.39¹
Paid up share capital (face value of INR 5 each)	1,014.41		1,014.41	1,014.41

A detailed performance analysis on various segments, business and operations were provided in the
Management Discussion and Analysis Report which is form part of this report.

2. STATE OF AFFAIRS/ COMPANY''S PERFORMANCE

The Company is a provider of various Manpower Solutions which includes General Staffing, Security Services,
Integrated Facilities Management Services and IT Staffing Services as per client''s requirements.

*As the Company has incorporated it''s wholly owned subsidiaries during the financial year 2024-25, the consolidated
financial statements for the financial year 2023-24 are not applicable."

Standalone

The Company recorded a total turnover including other income at INR 68,951.64 Lakhs (Previous Year INR

52.132.91 Lakhs) up by 32.26%; The Profit before Tax stood at INR 1,504.02 Lakhs (Previous year INR 992.49 Lakhs)
up by 51.54%; and the Net Profit after Tax and other comprehensive income at INR 1,729.95Lakhs (Previous year
INR 1,291.36 Lakhs) up by 33.96%.

Consolidated

The Company recorded a total turnover including other income at INR 69,023.18 Lakhs (Previous Year INR

52.132.91 Lakhs) up by 32.40%; The Profit before Tax stood at INR 1,503.95 Lakhs (Previous year INR 992.49 Lakhs)
up by 51.53%; and the Net Profit after Tax and other comprehensive income at INR 1,730.23Lakhs (Previous year
INR 1,291.36 Lakhs) up by 33.99%.

3. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

As on March 31,2025, the Company has Two (2) Wholly Owned Subsidiaries. There are no Joint Ventures or
Associate Companies within the meaning of the Companies Act, 2013 ("the Act"). There has been no
material change in the nature of the business of the subsidiaries. Pursuant to first proviso to Sub-Section
(3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014, a statement containing the salient
features of the financial statements of the Company''s subsidiaries / associates / Joint Ventures of the
Company in Form AOC-1, is enclosed as ANNEXURE-I to this report.

4. CONSOLIDATED FINANCIAL STATEMENTS

Consolidated financial statements have been prepared by the Company in accordance with the relevant
accounting standards issued by the Institute of Chartered Accountants of India (ICAI) and as per the
provisions of Section 129(3) of the Companies Act, 2013 and as per SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("SEBI Listing Regulations"). Further, pursuant to the provisions of
Section 136 of the Act, the financial statements including the consolidated financial statements, along with
the relevant document''s forms part of this annual report and are available on the website of the Company
www.kapstonservices.com. Any member desirous of inspecting or obtaining a copy of the said financial
statements may write to the Company Secretary of the Company at email ID: [email protected].

5. CHANGE IN NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

6. DIVIDEND

The Board of Directors of the Company has not recommended Dividend for the financial year ended
March 31,2025.

7. LISTING OF EQUITY SHARES

The security name of the Company on National Stock Exchange of India Limited is Kapston Services
Limited and NSE symbol is ''KAPSTON''.

The company has paid the listing fee for the financial year 2024-25.

8. TRANSFER TO RESERVES

For the financial period under review, your Company has not proposed to transfer any amount to the
General Reserves.

9. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND
PROTECTION FUND

The provisions of Section 124 of Companies Act, 2013 are not applicable as the Company has not
completed seven years from the date of declaration of dividend.

10. SHARE CAPITAL

During the year under review, shareholders have passed the ordinary resolution through postal ballot by
remote e-voting dated July 03, 2024 for sub-division of 1 (One) equity share of ?10/- (Rupees Ten) each
into 2 (Two) equity shares of ?5/- (Rupees Five) each.

Consequently, as on March 31, 2025, the Authorized Share Capital of the Company is INR 11,50,00,000 /-
(Rupees Eleven Crores and Fifty Lakhs only) divided into 2,30,00,000 (Two Crore Thirty Lakhs only) equity
shares of INR 5/- (Rupees Five only) each and Paid-up Equity Share Capital of the Company
INR 10,14,40,610/- (Ten Crore Fourteen Lakhs Forty Thousand Six Hundred and Ten Rupees Only) divided
into 2,02,88,122 (Two Crores two lakhs eighty eight thousand one hundred and twenty two) equity shares
of INR 5/- (Rupees Five only) each.

During the year under review, your Company has not issued any shares with differential rights and hence
no information as per the provisions of Section 43(a)(ii) of the Companies Act, 2013 (hereinafter referred as
"the Act") read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished and
the Company has not issued any stock options to its employees.

11. EMPLOYEES STOCK OPTION SCHEME

There is no employees stock option scheme being implemented by the Company.

12. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments made during the financial year ended March 31, 2025,
covered under the provisions of Section 186 of the Companies Act, 2013 read with Companies (Meetings of
Board and its Powers) Rules, 2014, are given in the notes to the Financial Statements.

13. DEPOSITS

During the year under review, the Company has neither invited nor accepted deposits from the
public/members under Section 73 of the Act, read with the Companies (Acceptance of Deposits) Rules,
2014.

14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

During the Year under review, all contracts / arrangements / transactions entered by the Company with
related parties were in the ordinary course of business and on an arm''s length basis. The particulars of such
contracts or arrangements with related parties are in the form of as Form AOC-2 as enclosed in
"ANNEXURE-II" to this report. Further details of related party transactions are provided in Notes to
Financial Statements (both Standalone and Consolidated).

The policy on dealing with RPT as approved by the Board is uploaded on the Company''s website at:
https://kapstonservices.com/investors/#policies

15. RISK MANAGEMENT

Risk management is the process of identification, assessment and prioritization of risks followed by
coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of
unfortunate events to maximize the realization of opportunities. The company has initiated a process of
preparing a comprehensive risk assessment and minimization procedure. These procedures are meant to
ensure that executive management controls risk by way of a defined framework. The major risks are being
identified by the company and its mitigation process/measures being formulated in areas of operations,
recruitment, financial processes and reporting, human resources and statutory compliance.

16. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE
COMPANY FROM THE END OF THE FINANCIAL YEAR TILL THE DATE OF THE REPORT

Other than those mentioned in this Report, there has been no material changes and commitments,
affecting the financial position of your Company having occurred between the end of the financial year to
which the financial statements relate and the date of this Report. Further, it is hereby confirmed that there
has been no change in the nature of business of the Company.

17. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION, AND REDRESSAL) ACT, 2013

The Company is committed to provide a safe and conducive work environment to its employees and has
zero tolerance towards any actions which may fall under the ambit of sexual harassment at the workplace.
The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at the
workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 and the rules made thereunder. The Policy aims to promote a healthy
work environment and to provide protection to employees at the workplace and redress complaints of
sexual harassment and related matters thereto.

The policy on prevention of sexual harassment is available on the website of the company at
https://kapstonservices.com/investors/#policies

An Internal Complaints Committee, known as the Prevention of Sexual Harassment (POSH) Committee,
has been constituted to enquire into complaints, and to recommend appropriate action, wherever
required in compliance with the provisions of the Act. All employees (Permanent, Contractual, temporary,
trainees) are covered under this policy.

The present composition of ICC is as under

â¢ Ms. Reena Rekulgikar - Presiding Officer

â¢ Ms. Triveni Banda - Member

â¢ Ms. Nitya Menon - Member

â¢ Mr. Vishnu Mora- Member

â¢ Ms. Renuka Chadalawada - NGO

The following is a summary of sexual harassment complaints received and disposed off during the year:

Z S''* o	Particulars	Status of the No. of complaints received and disposed of
1	Number of complaints on Sexual harassment received in the year	Nil
2	Number of Complaints disposed off during the year	Nil
3	Number of cases pending for more than ninety days	Not Applicable
4	Number of workshops or awareness programme against sexual harassment carried out	The Company regularly conducts necessary awareness programs for its employees.
5	Nature of action taken by the employer or district officer	Not Applicable

18. MEETINGS OF THE BOARD

During the year under review, 6 (Six) Meetings of the Board were held as per the Standards as outlined in
the Secretarial Standard - I. The maximum gap between two consecutive board meetings was within the
period as prescribed under the provisions of the Companies Act, 2013.

Details of the meetings of the Board along with the attendance of the Directors therein have been
disclosed as part of the Corporate Governance Report forming part of this Annual Report.

19. COMMITTEES OF THE BOARD

As of March 31, 2025, the Board has Four (4) committees and has constituted the following committees,
under the provisions of the Companies Act, 2013, and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as applicable, which are in place and discharging their functions as per
terms of reference entrusted by the Board from time to time:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders Relationship Committee

4. Corporate Social Responsibility Committee

The composition, attendance, powers, and roles of the Committees are included in the Corporate
Governance Report which forms part of this Annual Report. During the year, all recommendations of the
Committees were accepted by the Board

20. CORPORATE GOVERNANCE

Your company practices the best corporate governance procedures to uphold the true spirit of law,
integrity and transparency by adhering to our core values with an objective of maximizing stakeholders
value. The Report on Corporate Governance, pursuant to the provisions of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 is enclosed as ANNEXURE-III, and a certificate obtained
from the Practicing Company Secretary confirming compliance with Corporate Governance requirements
as provided in the aforesaid Regulations is annexed to this report.

21. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Nomination and Remuneration Committee has adopted a policy as per Section 178(3) of the
Companies Act, 2013 for determination of remuneration and the manner of selection of the Board of
Directors, CS, CFO and Managing Director.

Criteria for selection of Non-Executive Directors

> The Non-Executive Directors shall be of high integrity with relevant expertise and experience in the fields of
Service Industry, Marketing, Finance Taxation Law, governance and general management.

> In case of appointment of Independent Directors, the committee shall satisfy itself with regard to the criteria
of independence of the directors vis-a-vis the company so as to enable the board to discharge its function
and duties effectively.

> The committee shall ensure that the candidate identified for appointment as a director is not disqualified for
appointment under Section 164 of the Companies Act, 2013.

> The committee shall consider the following attributes, whilst recommending to the board the candidature
for appointment as a Director:

Â¦ Qualification, expertise and experience of the directors in their respective fields.,

Â¦ Personal, professional or business standing.;

Â¦ Diversity of the Board.

Â¦ In case of re-appointment of Non-Executive Directors, the Board shall take into consideration the
performance evaluation of the Directors and their engagement level.

Remuneration

The Non-Executive Directors shall not be entitled to receive remuneration except by way of sitting fees,
reimbursement of expenses for participation in the board/committee meetings and commission. The
Independent Director of the company shall not be entitled to participate in the Stock Option Scheme of the
company. The aggregate commission paid to the Non-Executive Directors is within the statutory limit of the
company.

Criteria for selection/appointment of Managing Director, Executive Director, CS and CFO

For the purpose of selection of the Managing Director, Executive Director, Company Secretary and Chief Financial
Officer, the Committee shall identify persons of integrity who possess relevant expertise, experience and
leadership qualities required for the position.

The Committee will also ensure that the incumbent fulfils such other criteria with regard to age and other
qualifications as laid down under Companies Act, 2013 or other applicable laws.

Remuneration to Managing Director and Executive Director

â¢ At the time of appointment or re-appointment, the Executive Director and Managing Director shall be paid
such remuneration as may be mutually agreed between the Company (which includes the Committee and
the Board of Directors) and the Executive Director/ Managing Director, within the overall limits prescribed
under the Companies Act, 2013.

â¢ The remuneration shall be subject to the approval of the members of the Company in General Meeting in
compliance with the provisions of the Companies Act, 2013.

Remuneration Policy for the Senior Management Employees including CFO & CS

In determining the remuneration of Senior Management Employees, the committee shall ensure/consider the
following:

(i) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the
person to ensure the quality required to run the Company successfully;

(ii) there is a balance between fixed and incentive pay, reflecting short and long term performance objectives
appropriate to the working of the Company and its goals

The policy relating to remuneration of Directors, Key Managerial Personnel, Senior Management and other
employees is available on the website of the Company https://kapstonservices.com/investors/#policies.

22. BOARD EVALUATION AND ASSESSMENT

The Board of Directors have carried out an annual performance evaluation of Individual Directors including

the chairman of the Company, the Board as a whole and its committees thereof, pursuant to the provisions

of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

â¢ Performance evaluation criteria is determined by the Nomination and Remuneration Committee.

â¢ A structured questionnaire was prepared to evaluate the performance after seeking inputs from the
Directors, 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.

â¢ A separate exercise was carried out to evaluate the performance of individual Directors including the
Chairman of the Board, who were evaluated on parameters such as level of engagement and
contribution at meetings, independence, safeguarding the interest of the Company and its minority
shareholders, etc.

â¢ The performance evaluation of the Independent Directors was carried out by the entire Board
(excluding the Director being evaluated), after seeking inputs from all the directors on the
effectiveness and contribution of the Independent Directors. The Process and criteria evaluation of
Performance of Independent Directors is explained in the Corporate Governance report which forms
part of the Annual Report.

â¢ The performance of the Committees was evaluated by the Board after seeking inputs from the
Committee members based on criteria such as the composition of Committees, effectiveness of
Committee meetings, etc.

â¢ The Board reviewed the performance of individual Directors based on the contributions made during
the Board and Committee meetings.

â¢ In a separate meeting of Independent Directors, the performance of Non-Independent Directors, and
the performance of the Chairman was evaluated, taking into account the views of executive directors
and non-executive directors. The Independent Directors also assessed the quality, frequency, and
timeliness of flow of information between the Board and the management that is necessary for
effective performance.

â¢ The Board of Directors has expressed their satisfaction with the evaluation process.

23. FAMILIARISATION PROGRAM FOR INDEPENDENT DIRECTORS

All Independent Directors are familiarised with the operations and functioning of the Company at the time
of their appointment and on an ongoing basis. The Familiarisation Program was conducted with an
objective to provide an opportunity to familiarise the independent directors related to the nature of the
industry, the Business model of the company, and the roles, rights, and responsibilities of independent
directors. They have the full opportunity to interact with Senior Management personnel and Heads of the
department and are provided with all documents as required and sought by them to enable them to have a
good understanding.

The details of such Familiarisation Program and other disclosures as specified under the Listing regulations
are available on the Company''s website at https://kapstonservices.eom/investors/#policies.

24. DIRECTORS AND KEY MANAGERIAL PERSONNEL

As of March 31, 2025, the Board comprises Six (06) Directors viz., Three (03) Independent Directors
including One Woman Independent Director One (01) Non-Executive Non-Independent Director, and Two
(02) Executive Directors.

Retirement by Rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of
Associations of the Company, Ms. Doddapaneni Kanti Kiran (DIN: 07420023) retires by rotation at the
ensuing Annual General Meeting (AGM) and being eligible, offers herself for reappointment. The Board
recommends her re-appointment.

Changes in Directors

Reappointment of Independent Directors

During the period under review, based on the recommendations of the Nomination and Remuneration
Committee and Board of Directors of the Company, the members have reappointed Mr. Nageswara Rao
Koripalli (DIN: 08734786) as an Independent director of the company for the second term of 5
consecutive years with effect from April 29, 2025 through Postal Ballot.

Appointment and Resignation of KMP

During the year under review, Mr. Srikanth Kodali, Managing Director, Dr. Chereddi Ramachandra
Naidu, Executive Chairman, Mr. Kapil Sood, CFO and Ms. Triveni Banda, Company Secretary are Key

Managerial Personnel of the Company in accordance with the provisions of Section(s) 2(51) and 203 of the
Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managing Personnel)
Rules, 2014.

During the year under review, there are no changes in the Key Managerial Personnel of the Company.
However, based on the recommendations of the Nomination and Remuneration Committee and Board of
Directors of the Company, the members have reappointed Dr. Chereddi Ramachandra Naidu as an
Executive Chairman of the Company.

25. INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors as required under section
149(6) of the Companies Act, 2013 along with Rules framed thereunder and Regulation 16(1)(b) of the
Listing Regulations stating that they meet the criteria of independence. There has been no change in the
circumstances affecting their status as independent directors of the Company.

The Board has reviewed the integrity, expertise, experience, and requisite proficiency of the independent
directors and confirmed that the Independent Directors fulfill the conditions specified in the SEBI Listing
Regulations and are independent of the management and the same is given in the Corporate Governance
Report. As prescribed under Listing Regulations and according to Section 149(6) of the Act, the particulars
of Non Executive and Independent Directors (as of the date of signing this report) are as under:

1. Mr. Nageswara Rao Koripalli

2. Mr. Naveen Nandigam

3. Ms. Vanitha Nagulavari

26. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)( C ) of the Act, the Board of Directors, to the best of their knowledge and
information and explanations received from the Company, confirm that:

a) in the preparation of the accounts for the year ended March 31, 2025, the applicable standards have
been followed and there are no material departures from the same;

b) they 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 as at March 31,2025 and of the profit and loss of the Company for the year under review;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

d) they have prepared annual accounts of the Company on a ''going concern'' basis;

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

f) they have devised proper systems to ensure compliance with the provision of all applicable laws and
that such systems were adequate and operating effectively.

27. EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Act read with Rule 12 of the
Companies (Management and Administration) Rules, 2014, the Annual Return of the Company can be
accessed at https://kapstonservices.com/investors/#annual-return-and-notice

28. CORPORATE SOCIAL RESPONSIBILITY

The Company believes in building and maintaining a sustainable societal value, inspired by a noteworthy
vision to actively participate, contribute and impact not just individual lives but create a difference on a
social level as well.

In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy)
Rules 2014, the Company has established the CSR Committee.

The Board has adopted the CSR Policy, as formulated and recommended by the CSR Committee, and is
available on the Company''s website at https://kapstonservices.com/investors/#policies

During the financial year 2024-25, the Company has spent INR 8.84 Lakhs towards CSR expenditure. The
Company has contributed CSR funds that were aligned with Schedule VII of the Companies Act, 2013.

The disclosure of contents of CSR policy pursuant to provisions of Section 134(3)(o) of Act and Rule 9 of the
Companies (Corporate Social Responsibility) Rules, 2014 is enclosed herewith as ANNEXURE-IV to the
Board''s Report.

29. PARTICULARS OF EMPLOYEES

The Company is required to give disclosures under Section 197(12) of the Act, read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, which is enclosed as
''ANNEXURE-V'' and forms an integral part of this Report.

The statement containing the details of top 10 (ten)employees on roll and particulars of employees
employed throughout the year whose remuneration is more than Rs. 102 Lakhs or more per annum and
employees employed part-time and in receipt of remuneration of Rs. 85 Lakhs or more per annum as
required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules 2014, is available on the website of the Company at www.kapstonservices.com. Members interested
in obtaining these particulars may write to the Company Secretary at the Registered Office of the
Company. The aforesaid annexure is also available for inspection by the Members at the Registered Office
of the Company during business

30. MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and Analysis Report for
the year under review, is presented in a separate section, forming a part of the Annual Report.

31. AUDITORS AND AUDITORS'' REPORT
STATUTORY AUDITORS

M/s NSVR and Associates LLP, Chartered Accountants, (Firm Registration No.0008801S/S200060),
Statutory auditors of the company were appointed for a period of five years by the shareholders of the
Company to hold office from the conclusion of the 14^th Annual General Meeting till the conclusion of 19^thAnnual General Meeting.

As required under Section 139 of the Companies Act, 2013, the Company has received a written consent
from the Auditors to their continued appointment and also a certificate from them to the effect that their
existing appointment is in accordance with the conditions prescribed under the Companies Act, 2013 and
rules made thereunder.

The Board has duly examined the Statutory Auditors'' Report to the financial statements, which is selfÂ¬
explanatory. The Auditors report for Financial Year 2024-25 does not contain any qualification, reservation
or adverse remark for the year under review. The Auditor''s Report is enclosed with the financial statements
in this Annual Report. During the year under review, the Auditors have not reported to the Audit
Committee any instances of fraud committed against the Company by its officers or employees under
Section 143(12) of the Act and therefore no details are required to be disclosed under Section 134(3) (ca) of
the Act.

SECRETARIAL AUDITOR

M/s VCAN & Associates, Company Secretaries were appointed as Secretarial Auditors to conduct
Secretarial Audit of the Company for the year 2024-25 and have submitted the Secretarial Audit Report for
the year ending March 31,2025 which is enclosed to this Board''s Report as ANNEXURE-VI.

As per amended SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in addition to
the abovementioned Secretarial Audit Report, listed company is also required to obtain an Annual
Secretarial Compliance Report from a practicing Company Secretary w.r.t. the compliances of all applicable
SEBI Regulations, amendments, circulars or guidelines etc. by the Company. Accordingly, the same has
been obtained and filed with the concerned Stock Exchanges.

Further pursuant to SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, read with
Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) (Amendment)
Regulations, 2018, the Company is required to obtain a certificate from Practicing Company Secretary that
none of the directors on the Board of the company have been debarred or disqualified from being
appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such
statutory authority.

The said Certificate has been obtained from the M/s VCAN & Associates, Company Secretaries, which is
enclosed to this Board''s Report as ANNEXURE- VIA

COST AUDIT

Maintenance of cost records as specified by the Central Government under sub-section (1) of section
148 of the Act, is not applicable to the Company and accordingly such accounts and records are not
made and maintained.

INTERNAL AUDITOR

The Board based on the recommendation of the Audit Committee, has appointed TAN & Associates,
Chartered Accountant (Firm Registration No. 024082S) as the Internal Auditors for the financial year 2024Â¬
25. On a quarterly basis, Internal Auditors give presentations and provide a report to the Audit Committee
of the Company.

32. POSTAL BALLOT

The company has convened two general meetings through postal ballot. The details have been mentioned
in the corporate governance report .

33. INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its
operations. Based on the audit reports your company undertakes corrective action in their respective areas
and strengthen the controls.

The Board of Directors of the Company have adopted various policies like Related Party Transactions
policy, Whistle Blower Policy, code of conduct for regulating, monitoring and reporting insider trading and
such other procedures for ensuring the orderly and efficient conduct of its business for safeguarding its
assets, the prevention and detection of frauds and errors, the accuracy and completeness of the
accounting records, and the timely preparation of reliable financial information.

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, the Board has
approved the code of conduct for prohibition of insider trading and the same is being implemented by the
Company.

34. 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

During the financial year under review, there were no significant and material orders passed by the
regulators or courts or tribunals impacting the going concern status and company''s operations in the
future.

35. VIGIL MECHANISM

In compliance with Section 177(9) of the Act and Regulation 22 of the Listing Regulations, the Company
has a Whistle Blower Policy and has established the necessary vigil mechanism for Directors and
employees in confirmation with the above laws, to report concerns about unethical behaviour.

The details of the Policy is also available on the website of the Company
https://kapstonservices.com/investors/#policies

The policy provides for a framework and process, for the employees and directors to report genuine
concerns or grievances about leakage of unpublished price sensitive information (UPSI), illegal and
unethical behaviour to the Chairman of the Audit Committee.

The Policy also provides for adequate safeguards against victimization of employees who avail the
mechanism and also provides for direct access to the Chairman of the Audit Committee.

36. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION

Considering the nature of activities of the Company, the provisions of Section 134(m) of the Companies
Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy,
Research and Development, Technology Absorption are not applicable to the Company.

37. FOREIGN EXCHANGE EARNINGS AND OUTGO

During the financial year under review there is no foreign exchange earnings and outgo.

38. COMPLIANCE WITH THE SECRETARIAL STANDARDS

Pursuant to the provisions of Section 118 of the Act, the Company has complied with the applicable
provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India ("ICSI") and
notified by the Ministry of Corporate Affairs ("MCA").

39. DISCLOSURE OF ACCOUNTING TREATMENT

The Company in the preparation of financial statements has followed the treatment laid down in the
Accounting standards prescribed by the Institute of Chartered Accountants of India. There are no audit
qualifications on the Company''s financial statements for the year under review

40. COMPLIANCE TO THE PROVISIONS RELATING TO THE MATERNITY BENEFITS ACT, 1961

Your Company complies with the provisions of the Maternity Benefit Act, 1961, extending all statutory
benefits to eligible women employees, including paid maternity leave, continuity of salary and service
during the leave period and post-maternity support such as nursing breaks and flexible return-to-
workoptions, as applicable. Your company remains committed to fostering an inclusive and supportive
work environment that upholds the rights and welfare of its women employees in accordance with
applicable laws.

41. GREEN INITIATIVE

The Ministry of Corporate Affairs (MCA) has taken a green initiative in Corporate Governance by
allowing paperless compliance by the Companies and permitting the service of Annual Reports and
other documents to the shareholders through electronic mode subject to certain conditions and the
Company continues to send Annual Reports and other communications in electronic mode to those
members who have registered their email IDs with their respective depositories. Members may note
that Annual Reports and other communications are also made available on the Company''s website
https://www.kapstonservices.com and websites of the Stock Exchanges i.e., National Stock Exchange of
India Limited.

42. HUMAN RESOURCES

The Company considers its Human Resources as the key to achieving its objectives. Our HR and Operations
Department works closely with Senior Management to devise strategies that attract talent and enhance
capabilities. The employees are sufficiently empowered and enabled to work in an environment that
inspires them to achieve higher levels of performance. It is the unwavering commitment of our employees
that propels us forward and enables us to fulfil the Company''s vision. Your Company appreciates the
contribution of its dedicated employees. We believe that our employees are our most valuable asset. Your
Company is also focussed on the overall well-being of its employees. We are committed to creating a
positive work environment that prioritizes the health, safety, career growth and development of our
employees. The Company took various initiatives to keep the employees productive and engaged with
various employee training and awareness programs. we strengthen our collective capabilities and pave the
way for continued success

â 43. OTHER DISCLOSURES

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

â¢ There are no applications made or any proceeding pending against the Company under Insolvency
and Bankruptcy Code, 2016 (31 of 2016) during the financial year.

â¢ There are no instances of one-time settlement during the financial year.

â¢ Various policies as approved by the Board of Directors in accordance with the provisions of Companies
Act, 2013 and SEBI (LODR) Regulations, 2015 is hosted on the company''s website at
https://kapstonservices.eom/investors/#policies

â¢ Neither the Managing Director nor the Whole-time Directors of the Company receive any
remuneration or commission from any of its subsidiaries.

â¢ Issue of equity shares with differential voting rights as to dividend, voting, or otherwise.

â¢ Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

44. ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Central Government, various State Governments and
Company''s Bankers and advisors for the valuable advice, guidance, assistance, co-operation, and
encouragement they have extended to the Company from time to time. The Directors also take this
opportunity to thank the Company''s Clients, partners, investors, Employees and all other Stakeholders,
Regulators and Stock Exchange for their consistent support to the Company.

For and on behalf of the Board
Kapston Services Limited

Sd/-

Dr. Chereddi Ramachandra Naidu

Place: Hyderabad Executive Chairman

Date: August 04, 2025 DIN: 02096757

Previous year figures have been regrouped/rearranged wherever necessary.

Mar 31, 2024

The Board of Directors (âBoardâ) of Kapston Services Limited (âKapstonâ or âCompanyâ) are pleased to present the Sixteenth Annual Report on the business and operations of your company together with the Audited Financial Statements for the financial year ended March 31,2024.

1. FINANCIAL HIGHLIGHTS

iâThe summarized Financial Statements of your company are given in the following table below:

(INR in Lakhs)
Particulars	2023-24	2022-23
Revenue from Operations	52008.06	39896.37
EBITDA	2413.99	1570.79
Less: Finance Costs	1059.79	905.52
Less: Depreciation and amortization expenses	361.71	430.40
Profit before prior period items	992.49	234.87
Prior period items	-	-
Profit before tax	992.49	234.87
Less: Current Tax	-	-
Deferred Tax	(264.58)	(272.16)
Profit Available for appropriations/Loss	1257.07	507.03
Basic Earnings per Share (Rs.)	12.39	5.00
Diluted Earnings per Share (Rs.)	12.39	5.00
Paid up share capital
(face value of INR 10 each)	1014.41	1014.41

A detailed performance analysis on various segments, business and operations was provided in the Management Discussion and Analysis Report, which is annexed to this report.

2. STATE OF AFFAIRS/ COMPANY''S PERFORMANCE

The Company is a provider of various manpower solutions, which includes General Staffing, Security Services, Integrated Facilities Management Services and IT Staffing Services as per client''s requirements.

The company recorded a total turnover including other income at INR 52,132.91 Lakhs (Previous Year INR 40,103.68 Lakhs) up by 30%; The Profit before Tax stood at INR 992.49 Lakhs (Previous year INR 234.87 Lakhs) up by 322.56%; and the Net Profit after Tax and other comprehensive income at INR 1,291.36 Lakhs (Previous year INR 511.85 Lakhs) up by 152.30%.

3. DIVIDEND

The Board of Directors of the company has not recommended any dividend for the financial year ended March 31,2024.

4. LISTING OF EQUITY SHARES

The securities of the company are listed at National Stock Exchange of India Limited (NSE). The security name ofthe company on NSE is Kapston Services Limited and NSE scrip symbol is âKAPSTONâ.

The company has paid the listing fee for the financial year 2023-24.

5. TRANSFER TO RESERVES

During the period under review, your company has not proposed to transfer any amount to the General Reserves.

6. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The provisions of Section 124 of Companies Act, 2013 are not applicable as the company has not completed seven years from the date of declaration of dividend.

7. SHARE CAPITAL

During the period under review, there has been no change in the Authorized Share Capital of the company. The Authorized Share Capital of the company is INR 11,50,00,000 /- (Rupees Eleven Crores and Fifty Lakhs only) divided into 1,15,00,000 (One Crore Fifteen Lakhs only) equity shares of INR 10/- (Rupees Ten only) each. *

During the period under review, there has been no change in the Paid-up share capital structure of the company. The Paid-Up Capital is INR 10,14,40,610/- (Rupees Ten Crore Fourteen Lakhs Forty Thousand Six Hundred and Ten Rupees Only) divided into 1,01,44,061 (One Crore One Lakh Forty-Four Thousand Sixty-One) equity shares of INR 10/- (Rupees Ten only) each.

The company has not issued any shares with differential rights and hence no information as per the provisions of Section 43(a)(ii) of the Companies Act, 2013 (hereinafter referred as "the Act") read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished and the company has not issued any stock options to its employees.

During the current financial year 2024-25 face value of the equity shares has been sub-divided to Rs.5/- each from Rs. 10/- each after obtaining necessary approvals and the trading with the face value of Rs.5/- is effective from 9 August, 2024.

* Company has passed an ordinary resolution dated July 3, 2024 through postal ballot by remote e-voting for sub-division of 1 (One) equity share of ?10/- (Rupees Ten) each into 2 (Two) equity shares of ?5/- (Rupees Five) each. w.e.f August 9, 2024.

8. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Your company has not given any loans/guarantees and not made any investments during the financial year 2023-24, as specified under the provisions of Section 186 of the Companies Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014.

* The company has incorporated a wholly-owned subsidiary in the name of Kapston Manpower Services Private Limited on 27^th July, 2024 and the business of the said company has not yet started.

9. DEPOSITS

During the year under review, the company has neither invited nor accepted deposits from the public/members under Section 73 of the Act, read with the Companies (Acceptance of Deposits) Rules, 2014.

10. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

During the financial year under review, there is no Related Party Transaction and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

Further there are no transactions as per Section 188(1) ofthe Companies Act, 2013, therefore disclosure as per the provision of Section 134 ofthe Act (Form AOC-2) is not applicable.

11. RISK MANAGEMENT

Risk management is the process of identification, assessment and prioritization of risks followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of unfortunate events to maximize the realization of opportunities. The company has initiated a process of preparing a comprehensive risk assessment and minimization procedure. These procedures are meant to ensure that executive management controls risk by way of a defined framework. The major risks are being identified by the company and its mitigation process/measures being formulated in areas of operations, recruitment, financial processes and reporting, human resources and statutory compliance.

12. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY FROM THE END OF THE FINANCIAL YEAR TILL THE DATE OF THE REPORT

Other than those mentioned in this report, there have been no material changes and commitments, affecting the financial position of your company having occurred between the end of the financial year to which the financial statements relate and the date of this report. Further, it is hereby confirmed that there has been no change in the nature of business of the company.

13. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The company is committed to provide a safe and conducive work environment to its employees and has zero tolerance towards any actions, which may fall under the ambit of sexual harassment at the workplace. The company has adopted a policy on prevention, prohibition and redressal of sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder. The policy aims to promote a healthy work environment and to provide protection to employees at the workplace and redress complaints of sexual harassment and related matters thereto.

The policy on prevention of sexual harassment is available on the website of the company at https://kapston services.com/investors/#policies

An internal complaints committee, known as the Prevention of Sexual Harassment (POSH) committee, has been constituted to enquire into complaints and to recommend appropriate action, wherever required in compliance with the provisions of the Act. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

a. number of complaints filed during the financial year - NIL.

b. number of complaints disposed of during the financial year - NA.

c. number of complaints pending at the end of the financial year - NIL.

14. MEETINGS OF THE BOARD

During the year, 5 (Five) Board meetings were convened and held. Details of the number of meetings of Board of Directors and committees thereof and the attendance of the Directors in such meetings are provided under the Corporate Governance Report, which forms part of this report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

15. COMMITTEES OF THE BOARD

Detailed composition of the Board committees, number of meetings held during the year under review and other related details are set out in the Corporate Governance Report, which forms a part of this report.

16. CORPORATE GOVERNANCE

A detailed report on Corporate Governance, pursuant to the requirements of Regulation 34 of the Listing Regulations, forms part of the Annual Report as annexure. A certificate from VCAN and Associates, Practicing Company Secretaries, Hyderabad, confirming compliance to conditions of Corporate Governance, as stipulated under the Listing Regulations, is annexed to the Corporate Governance Report Annexure I, which forms part of this Annual Report.

17. POLICY ON DIRECTORS'' APPOINTMENT, REMUNERATION AND OTHER DETAILS

The Nomination and Remuneration Committee has adopted a policy as per Section 178(3) of the Companies Act, 2013 for determination of remuneration and the manner of selection of the Board of Directors, CS, CFO and Managing Director.

Criteria for selection of Non-Executive Director

â¢ The Non-Executive Directors shall be of high integrity with relevant expertise and experience in the fields of Service Industry, Marketing, Finance Taxation Law, Governance and General Management.

â¢ In case of appointment of Independent Directors, the committee shall satisfy itself with regard to the criteria of independence of the directors vis-a-vis the company so as to enable the board to discharge its function and duties effectively.

â¢ The committee shall ensure that the candidate identified for appointment as a director is not qualified for appointment under Section 164 of the Companies Act, 2013.

â¢ The committee shall consider the following attributes, whilst recommending to the board the candidature for appointment as a director:

â¢ Qualification, expertise and experience of the directors in their respective fields.

â¢ Personal, professional or business standing.

â¢ Diversity of the Board.

â¢ In case of re-appointment of Non-Executive Directors, the Board shall take into consideration the performance evaluation of the Directors and their engagement level.

Remuneration

The Non-Executive Directors shall not be entitled to receive remuneration except by way of sitting fees, reimbursement of expenses for participation in the board/committee meetings and commission. The Independent Director of the company shall not be entitled to participate in the Stock Option Scheme of the company. The aggregate commission paid to the Non-Executive Directors is within the statutory limit of the company.

Criteria for selection/appointment of Managing Director, Executive Director, CS and CFO

For the purpose of selection of the Managing Director, Executive Director, Company Secretary and Chief Financial Officer, the Committee shall identify persons of integrity who possess relevant expertise, experience and leadership qualities required for the position.

The Committee will also ensure that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under Companies Act, 2013, or other applicable laws.

Remuneration to Managing Director and Executive Director

â¢ At the time of appointment or re-appointment, the Executive Director and Managing Director shall be paid such remuneration as may be mutually agreed between the Company (which includes the Committee and the Board of Directors) and the Executive Director/Managing Director, within the overall limits prescribed under the Companies Act, 2013.

â¢ The remuneration shall be subject to the approval of the members of the Company in General Meeting in compliance with the provisions of the Companies Act, 2013.

Remuneration Policy for the Senior Management Employees including CFO & CS

In determining the remuneration of Senior Management Employees, the committee shall ensure/consider the following:

(i) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the person, to ensure the quality required to run the Company successfully;

(ii) there is a balance between fixed and incentive pay, reflecting short and long term performance objectives appropriate to the working of the Company and its goals.

The policy relating to remuneration of Directors, Key Managerial Personnel, Senior Management and other employees is available on the website ofthe Company at https://kapstonservices.com/ investors/#policies

18. BOARD EVALUATION AND ASSESSMENT

The Board of Directors have carried out an annual evaluation of its own performance, Board committees and individual Directors pursuant to the provisions of the Sections 134, 178 and Schedule IV of the Companies Act, 2013. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, execution and performance of specific duties by the Board of Directors, independence, ethics and values, attendance and contribution at meetings etc.

The performance of the Independent Directors were evaluated by the Board after seeking inputs from all the Directors on the effectiveness and contribution of the Independent Directors.

The performance of the Committees was evaluated by the Board after seeking inputs from the Committee members based on the criteria such as the composition of Committees, effectiveness of Committee meetings, etc.

The Board reviewed the performance of the individual Directors on the basis of the contribution of the individual Director.

In a separate meeting of Independent Directors, performance of Non-Independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive director and non-executive directors. The Independent Directors also assessed the quality, frequency and timeliness of flow of information between the Board and the management that is necessary for effective performance.

19. DIRECTORS AND KEY MANAGERIAL PERSONNELâ¢ Retirement by Rotation

In accordance with the provisions of Section 152 ofthe Companies Act, 2013 and the Articles ofAssociations of the Company, Mr. Srikanth Kodali (DIN: 02464623), retires by rotation at the ensuing Annual General Meeting (AGM) and being eligible, offers himself for reappointment. The Board recommends his reappointment.

28 | Annual Report 2023-

â¢ Appointment of Directors as on the Date of Report

During the year under review, Ms. Vanitha Nagulavari (DIN: 07271674) has been re-appointed as an Independent Director for the second term of 5 consecutive years with effect from 30^th August, 2023 and Mr. Srikanth Kodali (DIN 02464623) has been re-appointed as a Managing Director for a period of three years with effect from 29^th January, 2024 vide special resolution dated 25^th September, 2023 at the 15^th Annual General Meeting.

â¢ Reappointment of Executive Chairman after closing of financial year

Dr. Chereddi Ramachandra Naidu (DIN: 02096757) is about complete his tenure as an executive chairman. The Board on the recommendation of Nomination and Remuneration Committee is of the opinion to reappoint Dr. Chereddi Ramachandra Naidu (DIN: 02096757) as an Executive Chairman, for a further period of 3 years w.e.f 29^th August, 2024 pursuant to the approval of shareholders in ensuring 16^th Annual General Meeting.

â¢ Appointment and Resignation of KMP

During the year under review, Mr. Srikanth Kodali, Managing Director, Mr. Kapil Sood, Chief Financial Officer and Ms. Triveni Banda, Company Secretary* are the key managerial personnel of the company in accordance with the provisions of Section (S) 2 (51) and 203 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managing Personnel) Rules, 2014.

*Ms. Triveni Banda (A68042) has been appointed as the Company Secretary w.e.f. 15^th December, 2023 in the place of Ms. Kalluru Manaswini, who has resigned as a Company Secretary w.e.f. 7^th December, 2023.

20. DECLARATION BY THE INDEPENDENT DIRECTORS

The Company has received declarations from the Independent Directors that they meet the criteria of independence as prescribed under Section 149(6) of the Act along with rules framed there under and Regulation 16(1)(b) and 25 of the Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company.

None of the Directors of the Company are disqualified from being appointed as Directors as specified in Section 164(2) of the Act and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

21. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(3) ( C) of the Act, the Board of Directors, to the best of their knowledge and information and explanations received from the Company, confirm that:

a) in the preparation of the accounts for the year ended March 31, 2024, the applicable standards have been followed and there are no material departures from the same;

b) they 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 as at March 31,2024 and of the profit and loss of the Company for the year under review;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared annual accounts of the Company on a ''going concern'' basis;

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

f) they have devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.

22. EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company is placed on the website of the company at https://kapstonservices.com/investors/#annual-return-and-notice

23. CORPORATE SOCIAL RESPONSIBILITY

The Company believes in building and maintaining a sustainable societal value, inspired by a noteworthy vision to actively participate, contribute and impact not just individual lives but create a difference on a social level as well.

In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy)

Rules 2014, the Company has established the CSR Committee.

The Board has adopted the CSR Policy, as formulated and recommended by the CSR Committee, and is available on the Company''s website at https://kapstonservices.com/investors/#policies

The disclosure of contents of CSR policy pursuant to provisions of Section 134(3)(o) of Act and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is annexed herewith as Annexure II to the Board''s Report.

24. PARTICULARS OF EMPLOYEES

The information relating to remuneration and other details as required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is provided as an Annexure III to this report.

There are no employees who draw remuneration in excess of the limits prescribed in Rule 5(2)(i), (ii) and (iii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Pursuant to the provisions of the first proviso to Section 136(1) of the Act, the annual report excluding the remuneration details of top ten employees is being sent to the Members of the Company. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

25. MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and Analysis Report for the year under review, is presented in a separate section, forming a part of the Annual Report.

26. STATUTORYAUDITORS

M/S NSVR and Associates LLP, Chartered Accountants, (Firm Registration No.0008801S/S200060), Statutory auditors of the company were appointed for a period of five years by the shareholders of the Company to hold office from the conclusion of the 14^th Annual General Meeting till the conclusion of 19^thAnnual General Meeting.

As required under Section 139 of the Companies Act, 2013, the Company has received a written consent from the Auditors to their continued appointment and also a certificate from them to the effect that their existing appointment is in accordance with the conditions prescribed under the Companies Act, 2013 and rules made thereunder.

30 I Annual Rfnnrt 2023-24

The Board has duly examined the Statutory Auditorsâ Report to the financial statements, which is selfexplanatory. The Auditors report for Financial Year 2023-2024 does not contain any qualification, reservation or adverse remark for the year under review. The Auditorâs Report is enclosed with the financial statements in this Annual Report. During the year under review, the Auditors have not reported to the Audit Committee any instances of fraud committed against the Company by its officers or employees under Section 143(12) of the Act and therefore no details are required to be disclosed under Section 134(3) (ca) of the Act.

27. SECRETARIAL AUDITOR

M/s VCAN & Associates, Practicing Company Secretaries, Hyderabad were appointed as Secretarial Auditors to conduct Secretarial Audit ofthe Company for the financial year 2023-2024 and have submitted the Secretarial Audit Report for the year ending 31 March 2024 which is annexed to this Board''s Report as Annexure-IV.

As per amended SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in addition to the above mentioned Secretarial Audit Report, listed company is also required to obtain an Annual Secretarial Compliance Report from a practicing Company Secretary w.r.t. the compliances of all applicable SEBI Regulations, amendments, circulars or guidelines etc., by the Company. Accordingly, the same has been obtained and filed with the concerned Stock Exchanges.

Further pursuant to SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, read with Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) (Amendment) Regulations, 2018, the Company is required to obtain a certificate from Practicing Company Secretary that none of the directors on the Board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority.

The said Certificate has been obtained from M/s VCAN & Associates, Practicing Company Secretaries, Hyderabad which is annexed to this Board''s Report as Annexure- IA

28. COST AUDIT

The Maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Act, is not applicable to the Company and accordingly such accounts and records are not made and maintained.

29. INTERNAL AUDITOR

The Board, on the recommendation of the Audit Committee, in its meeting had approved the appointment of M/s TAN & Associates, Chartered Accountant (Firm Registration No. 024082S) as the Internal Auditors of the Company for Financial year 2023-2024 to conduct the internal audit, which is reviewed each year in consultation with the Audit Committee. On a quarterly basis also, Internal Auditors give presentations and provide a report to the Audit Committee of the Company.

The Board based on the recommendation of the Audit Committee, has appointed M/S TAN & Associates, Chartered Accountant (Firm Registration No. 024082S ) as the Internal Auditors for the financial year 20242025.

30. POSTAL BALLOT

The Company has not conducted any Postal Ballot during the year under review. However, the Company has conducted the Postal Ballot during the financial year 2024-25 dated 3^rd July, 2024 and the details have been mentioned in Corporate Governance Report.

31. INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Based on the audit reports your company undertakes corrective action in their respective areas and strengthen the controls.

The Board of Directors of the Company have adopted various policies like Related Party Transactions policy, Whistle Blower Policy, code of conduct for regulating, monitoring and reporting insider trading and such other procedures for ensuring the orderly and efficient conduct of its business for safeguarding its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, the Board has approved the code of conduct for prohibition of insider trading and the same is being implemented by the Company.

32. 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

During the financial year under review, there were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in the future.

33. VIGIL MECHANISM

In compliance with Section 177(9) of the Act and Regulation 22 of the Listing Regulations, the Company has a Whistle Blower Policy and has established the necessary vigil mechanism for Directors and employees in confirmation with the above laws, to report concerns about unethical behaviour.

The details of the Policy is also available on the website of the Company at https://kapstonservices.com/ investors/#policies

The policy provides for a framework and process, for the employees and directors to report genuine concerns or grievances about leakage of unpublished price sensitive information (UPSI), illegal and unethical behaviour to the Chairman of the Audit Committee.

34. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOL-OGY ABSORPTION

Considering the nature of activities of the Company, the provisions of Section 134 (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, Research and Development, Technology Absorption are not applicable to the Company.

35. FOREIGN EXCHANGE EARNINGS AND OUTGO

During the financial year under review, there is no foreign exchange earnings and outgo.

36. COMPLIANCE WITH THE SECRETARIAL STANDARDS

Pursuant to the provisions of Section 118 of the Act, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India (âICSIâ) and notified by the Ministry of Corporate Affairs (âMCAâ).

37. DISCLOSURE OF ACCOUNTING TREATMENT

The Company in the preparation of financial statements has followed the treatment laid down in the

Accounting standards prescribed by the Institute of Chartered Accountants of India. There are no audit qualifications on the Companyâs financial statements for the year under review.

38. OTHER DISCLOSURES

â¢ During the year the Company does not have any subsidiary or group or associate company, therefore standalone financial statement is presented.¹

â¢ There are no applications made or any proceeding pending against the Company under Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the financial year.

â¢ There are no instances of one-time settlement during the financial year.

â¢ Various policies as approved by the Board of Directors in accordance with the provisions of Companies Act, 2013 and SEBI (LODR) Regulations, 2015 is hosted on the companyâs website at https://kapstonservices.com/investors/#policies

During the financial year 2024-25 the Company has incorporated a wholly owned subsidiary named as Kapston Manpower Services Private Limited on 27^th July 2024.

39. ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Central Government, various State Governments and Companyâs Bankers and advisors for the valuable advice, guidance, assistance, co-operation, and encouragement they have extended to the Company from time to time. The Directors also take this opportunity to thank the Companyâs Clients, partners, investors, employees and all other Stakeholders, Regulators and Stock Exchange for their consistent support to the Company.

Mar 31, 2023

The Board of Directors ("Board") of Kapston Services Limited (Formerly known as Kapston Facilities Management Limited) ("Kapston" or "Company") have immense pleasure in presenting the Fifteenth Annual Report on the business and operations of your company together with the Audited Financial Statements for the financial year ended 31 March 2023.

1. FINANCIAL HIGHLIGHTS

The summarized Financial Statements of your Company are given in the following table below:

(INR in Lakhs)
Particulars	2022-23	2021-22
Revenue from Operations	39896.37	27,224.96
EBITDA	1570.79	1309.83
Less: Finance Costs	905.52	665.38
Less: Depreciation and amortization expenses	430.40	545.68
Profit before prior period items	234.87	98.77
Prior period items	--	--
Profit before tax	234.87	98.77
Less: Current Tax	--	--
Deferred Tax	(272.16)	(148.57)
Profit Available for appropriations/Loss	507.03	247.34
Basic Earnings per Share (Rs.)	5.00	2.44
Diluted Earnings per Share (Rs.)	5.00	2.44
Paid up share capital (face value of INR 10 each)	1014.41	1014.41

A detailed performance analysis on various segments, business and operations were provided in the Management Discussion and Analysis Report which is annexed to this report.

2. STATE OF AFFAIRS / COMPANY''S PERFORMANCE

The Company is a provider of various Manpower Solutions which includes General Staffing, Security Services, Integrated Facilities Management Services and IT Staffing Services as per client''s requirements.

The Company recorded a total income including other income at INR 40103.68 Lakhs (Previous Year INR 27,277.77 Lakhs) up by 47.02%; The Profit before Tax stood at INR 234.87 Lakhs (Previous year INR 98.77 Lakhs) up by 137.8%; and the Net Profit after Tax and other comprehensive income at INR 511.85 Lakhs (Previous year INR 264.28 Lakhs) up by 93.68%.

3. DIVIDEND

The Board of Directors of the Company has not recommended Dividend for the financial year ended 31 March 2023.

4. LISTING OF EQUITY SHARES

The security name of the Company on National Stock Exchange of India Limited is Kapston Services Limited and NSE scrip symbol is ''KAPSTON''.

The Company migrated from SME Platform of NSE i.e., NSE Emerge to Main Board of NSE. The Equity shares of the Company are listed on the Main Board of "National Stock Exchange of India Limited" (NSE) with effect from 27^th May, 2020.

It may be noted that there are no payments outstanding to the Stock Exchanges by way of Listing Fees. The company has paid the listing fee for the financial year 2022-23.

5. TRANSFER TO RESERVES

For the financial period under review, your Company has proposed not to transfer any amount to the General Reserves.

6. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The provisions of Section 124 of Companies Act, 2013 are not applicable as the Company has not completed seven years from the date of declaration of dividend.

7. SHARE CAPITAL

During the period under review, there has been no change in the Authorised Share Capital of the Company. The Authorized Share Capital of the Company is INR 11,50,00,000 /- (Rupees Eleven Crores and Fifty Lakhs only) divided into 1,15,00,000 (One Crore Fifteen Lakhs only) equity shares of INR 10/-(Rupees Ten only) each.

During the period under review, there has been no change in the Paid up share capital structure of the Company. The Paid Up Capital is INR 10,14,40,610/- (Rupees Ten Crore Fourteen Lakhs Forty Thousand Six Hundred and Ten Rupees Only) divided into 1,01,44,061 (One Crore One Lakh Forty Four Thousand Sixty One) equity shares of INR 10/- (Rupees Ten only) each.

The Company has not issued any shares with differential rights and hence no information as per the provisions of Section 43(a)(ii) of the Companies Act, 2013 (hereinafter referred as "the Act") read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished and the Company has not issued any stock options to its employees.

8. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Your Company has not given any Loans / Guarantees and not made any Investments during the financial year 2022-23, as specified under the provisions of Section 186 of the Companies Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014.

9. DEPOSITS

During the year under review, the Company has neither invited nor accepted deposits from the public/ members under Section 73 of the Act, read with the Companies (Acceptance of Deposits) Rules, 2014.

10. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY

During the financial year under review all transactions with the related parties are in compliance with the provisions of section 188 of the Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

Further there are no transactions as per Section 188(1) of the Companies Act, 2013, therefore disclosure as per the provision of Section 134 (Form AOC-2) is not applicable.

11. RISK MANAGEMENT

Risk management is the process of identification, assessment and prioritization of risks followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of unfortunate events to maximize the realization of opportunities. The company has initiated a process of preparing a comprehensive risk assessment and minimization procedure. These procedures are meant to ensure that executive management controls risk by way of a defined framework. The major risks are being identified by the company and its mitigation process/measures being formulated in areas of operations, recruitment, financial processes and reporting, human resources and statutory compliance.

12. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY FROM THE END OF THE FINANCIAL YEAR TILL THE DATE OF THE REPORT

Other than those mentioned in this Report, there has been no material changes and commitments, affecting the financial position of your Company having occurred between the end of the financial year to which the financial statements relate and the date of this Report. Further, it is hereby confirmed that there has been no change in the nature of business of the Company.

13. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION, AND REDRESSAL) ACT, 2013

The Company is committed to provide a safe and conducive work environment to its employees and has zero tolerance towards any actions which may fall under the ambit of sexual harassment at the workplace. The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. The Policy aims to promote a healthy

work environment and to provide protection to employees at the workplace and redress complaints of sexual harassment and related matters thereto.

The policy on prevention of sexual harassment is available on the website of the company at https://kapstonservices.com/wp-content/uploads/2023/06/Policy-for-prevention-of-Sexual-Harassment-n.pdf

An Internal Complaints Committee, known as the Prevention of Sexual Harassment (POSH) Committee, has been constituted to enquire into complaints, and to recommend appropriate action, wherever required in compliance with the provisions of the Act. All employees (Permanent, Contractual, temporary, trainees) are covered under this policy.

a. number of complaints filed during the financial year - NIL.

b. number of complaints disposed of during the financial year - NOT APPLICABLE.

c. number of complaints pending as on end of the financial year - NIL.

14. MEETINGS OF THE BOARD

During the year, 4 (Four) Board meetings were convened and held. Details of the number of meetings of Board of Directors and committees thereof and the attendance of the Directors in such meetings are provided under the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

15. COMMITTEES OF THE BOARD

16. CORPORATE GOVERNANCE

A detailed report on Corporate Governance, pursuant to the requirements of Regulation 34 of the Listing Regulations, forms part of the Annual Report. A certificate from VCAN and Associates, Practicing Company Secretaries, Hyderabad, confirming compliance to conditions of Corporate Governance, as stipulated under the Listing Regulations, is annexed to the Corporate Governance Report Annexure I, which forms part of this Annual Report.

17. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Nomination and Remuneration Committee has adopted a policy as per Section 178(3) of the Companies Act, 2013 for determination of remuneration and the manner of selection of the Board of Directors, CS, CFO and Managing Director.

Criteria for selection of Non-Executive Director

> The Non-Executive Directors shall be of high integrity with relevant expertise and experience in the fields of Service Industry, Marketing, Finance, Taxation-Law, governance and general management.

> In case of appointment of Independent Directors, the committee shall satisfy itself with regard to the criteria of independence of the directors vis-a-vis the company so as to enable the board to discharge its function and duties effectively.

> The committee shall ensure that the candidate identified for appointment as a director is not disqualified for appointment under Section 164 of the Companies Act, 2013.

> The committee shall consider the following attributes, whilst recommending to the board the candidature for appointment as a director:

â¢ Qualification, expertise and experience of the directors in their respective fields.

â¢ Personal, professional or business standing.

â¢ Diversity of the Board.

â¢ In case of re-appointment of Non-Executive Directors, the Board shall take into consideration the performance evaluation of the Directors and their engagement level.

Remuneration

Independent Director of the company shall not be entitled to participate in the Stock Option Scheme of the company. The aggregate commission paid to the Non-Executive Directors, if any is within the statutory limit of the company.

Criteria for selection/appointment of Managing Director, Executive Director, CS and CFO

For the purpose of selection of the Managing Director, Executive Director, Company Secretary and Chief Financial Officer, the Committee shall identify persons of integrity who possess relevant expertise, experience and leadership qualities required for the position.

The Committee will also ensure that the incumbent fulfils such other criteria with regard to age and other qualifications as laid down under Companies Act, 2013, or other applicable laws.

Remuneration to Managing Director and Executive Director

â¢ At the time of appointment or re-appointment, the Executive Director and Managing Director shall be paid such remuneration as may be mutually agreed between the Company (which includes the Committee and the Board of Directors) and the Executive Director/ Managing Director, within the overall limits prescribed under the Companies Act, 2013.

â¢ The remuneration shall be subject to the approval of the members of the Company in General Meeting in compliance with the provisions of the Companies Act, 2013.

Remuneration Policy for the Senior Management Employees including CFO & CS

In determining the remuneration of Senior Management Employees, the committee shall ensure/ consider the following:

(i) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the person, to ensure the quality required to run the Company successfully;

(ii) there is a balance between fixed and incentive pay, reflecting short and long term performance objectives appropriate to the working of the Company and its goals

The policy relating to remuneration of Directors, Key Managerial Personnel, Senior Management and other employees is available on the website of the Company https://kapstonservices.com/wp-content/ uploads/2023/06/Nomination-and-Remuneration-Policy-n.pdf

18. BOARD EVALUATION AND ASSESSMENT

The performances of the Independent Directors were evaluated by the Board after seeking inputs from all the Directors on the effectiveness and contribution of the Independent Directors.

The Board reviewed the performance of the individual Directors on the basis of the contribution of the individual Director.

In a separate meeting of Independent Directors, performance of Non-Independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The Independent Directors also assessed the quality, frequency and timeliness of flow of information between the Board and the management that is necessary for effective performance.

19. DIRECTORS AND KEY MANAGERIAL PERSONNEL

â¢ Retirement by Rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Associations of the Company, Dr. Ramachandra Naidu Cherredi (DIN: 02096757), retires by rotation

at the ensuing Annual General Meeting (AGM) and being eligible, offers himself for reappointment. The Board recommends his re-appointment.

â¢ Appointment of Directors as on the Date of Report

During the year under review, Mr. Naveen Nandigam (DIN: 02726620) has been re-appointed as an Independent Director for the second term of 5 consecutive years with effect from 22^nd February, 2023.

â¢ Re-Appointment of Independent Director

Ms. Vanitha Nagulavari (DIN: 07271674) is completing her term as an Independent Director on 29^thAugust, 2023. The board on the recommendation of Nomination and Remuneration Committee is of the opinion to reappoint Ms. Vanitha Nagulavari (DIN: 07271674) as an Independent Director for a second term of Five (5) Years pursuant to the approval of Shareholders in the ensuing Annual General Meeting.

â¢ Re-Appointment of Managing Director

The Company has appointed Mr. Srikanth Kodali (DIN 02464623) as Managing Director for a period of three years with effect from 29^th January, 2021. The term of Mr. Srikanth Kodali (DIN 02464623) shall expire on 28^th January, 2024. The Board on the recommendation of Nomination and Remuneration Committee has proposed the re-appointment of the Managing Director shall be made earlier than before the expiry of his term in the ensuing Annual General Meeting of the Company.

â¢ Appointment and Resignation of KMP

During the year under review, Mr. Srikanth Kodali, Managing Director, Mr. Kapil Sood, Chief Financial Officer, Ms. Kalluru Manaswini, Company Secretary are the Key Managerial Personnel of the Company in accordance with the provisions of Section(s) 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managing Personnel) Rules, 2014.

20. DECLARATION BY THE INDEPENDENT DIRECTORS

The Company has received declarations from the Independent Directors that they meet the criteria of independence as prescribed under Section 149(6) of the Act along with rules framed thereunder and Regulation 16(1)(b) and 25 of the Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company.

None of the Directors of the Company are disqualified for being appointed as Directors as specified in Section 164(2) of the Act and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

21. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Act, the Board of Directors, to the best of their knowledge and information and explanations received from the Company, confirm that:

a) in the preparation of the accounts for the year ended 31 March 2023, the applicable standards have been followed and there are no material departures from the same;

b) they 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 as at 31 March 2023 and of the loss of the Company for the year under review;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared annual accounts of the Company on a ''going concern'' basis;

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

f) they have devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.

22. EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company for the financial year ended 31 March 2023 can be accessed at https://kapstonservices.com/investors/#annual-return-and-notice

23. CORPORATE SOCIAL RESPONSIBILITY

The Company believes in building and maintaining a sustainable societal value, inspired by a noteworthy vision to actively participate, contribute and impact not just individual lives but create a difference on a social level as well.

In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules 2014, the Company has established the CSR Committee.

The Board has adopted the CSR Policy, as formulated and recommended by the CSR Committee, and is available on the Company''s website at https://kapstonservices.com/wp-content/uploads/2023/06/CSR-Policy-n.pdf

24. PARTICULARS OF EMPLOYEES

25. MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and Analysis Report for the year under review, is presented in a separate section, forming a part of the Annual Report.

26. STATUTORY AUDITORS

As required under Section 139 of the Companies Act, 2013, the Company has received a written consent from the Auditors to their continued appointment and also a certificate from them to the effect that their existing appointment is in accordance with the conditions prescribed under the Companies Act, 2013 and rules made thereunder.

The Board has duly examined the Statutory Auditors'' Report to the financial statements, which is selfexplanatory. The Auditors report for Financial Year 2023 does not contain any qualification, reservation or adverse remark for the year under review. The Auditor''s Report is enclosed with the financial statements in this Annual Report. During the year under review, the Auditors have not reported to the Audit Committee any instances of fraud committed against the Company by its officers or employees under Section 143(12) of the Act and therefore no details are required to be disclosed under Section 134(3) (ca) of the Act.

27. SECRETARIAL AUDITOR

M/s VCAN & Associates, Company Secretaries were appointed as Secretarial Auditors to conduct Secretarial Audit of the Company and have submitted the Secretarial Audit Report for the year ending 31 March 2023 which is annexed to this Board''s Report as Annexure-IV.

As per amended SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in addition to the above mentioned Secretarial Audit Report, listed company is also required to obtain an Annual Secretarial Compliance Report from a practicing Company Secretary w.r.t. the compliances of all applicable SEBI Regulations, amendments, circulars or guidelines etc. by the Company. Accordingly, the same has been obtained and filed with the concerned Stock Exchanges.

Further pursuant to SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, read with Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) (Amendment) Regulations, 2018, the Company is required to obtain a certificate from Practicing Company Secretary that none of the directors on the Board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority.

The said Certificate has been obtained from the M/s VCAN & Associates, Company Secretaries, which is annexed to this Board''s Report as Annexure- IA

Pursuant to Section 204 of the Companies Act, 2013, M/s VCAN & Associates, Company Secretaries have been appointed as Secretarial Auditors to conduct Secretarial Audit of the Company for the financial year ending 31 March 2024.

28. COST AUDIT

Maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Act, is not required by the Company and accordingly such accounts and records are not made and maintained.

29. INTERNAL AUDITOR

The Board, on the recommendation of the Audit Committee, in its meeting had approved the appointment of Ms. Sravanthi Karuturi, Chartered Accountant (M No- 239567) as the Internal Auditors of the Company for Financial year 2022-2023 to conduct the internal audit, which is reviewed each year in consultation with the Audit Committee. On a quarterly basis also, Internal Auditors give presentations and provide a report to the Audit Committee of the Company.

30. POSTAL BALLOT

The Company has conducted the Postal Ballot for reappointment of Independent Director ofthe Company during the year under review. The details have been provided in the Corporate Governance report.

31. INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Based on the audit reports your company undertakes corrective action in their respective areas and strengthen the controls.

The Board of Directors of the Company have adopted various policies like Related Party Transactions policy, Whistle Blower Policy, code of conduct for regulating, monitoring and reporting insider trading and such other procedures for ensuring the orderly and efficient conduct of its business for safeguarding its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2015, the Board has approved the code of conduct for prohibition of insider trading and the same is being implemented by the Company.

32. 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

During the financial year under review, there were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in the future.

33. VIGIL MECHANISM

In compliance with Section 177(9) of the Act and Regulation 22 of the Listing Regulations, the Company has a Whistle Blower Policy and has established the necessary vigil mechanism for Directors and employees in confirmation with the above laws, to report concerns about unethical behaviour.

The details of the Policy is also available on the website of the Company https://kapstonservices.com/ wp-content/uploads/2023/06/Whistle-Blower-Policy-n.pdf

The policy provides for a framework and process, for the employees and directors to report genuine concerns or grievances about leakage of unpublished price sensitive information (UPSI), illegal and unethical behaviour to the Chairman of the Audit Committee.

34. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION

Considering the nature of activities of the Company, the provisions of Section 134(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, Research and Development, Technology Absorption are not applicable to the Company.

35. FOREIGN EXCHANGE EARNINGS AND OUTGO

During the financial year under review there is no foreign exchange earnings and outgo.

36. COMPLIANCE WITH THE ICSI SECRETARIAL STANDARDS

Pursuant to the provisions of Section 118 of the Act, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India ("ICSI") and notified by the Ministry of Corporate Affairs ("MCA").

37. DISCLOSURE OF ACCOUNTING TREATMENT

The Company in the preparation of financial statements has followed the treatment laid down in the Accounting standards prescribed by the Institute of Chartered Accountants of India. There are no audit qualifications on the Company''s financial statements for the year under review.

38. OTHER DISCLOSURES

â¢ The Company does not have any subsidiary or group or associate company, therefore standalone financial statement is presented.

â¢ There are no applications made or any proceeding pending against the Company under Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the financial year.

â¢ There are no instances of one-time settlement during the financial year.

Various policies as approved by the Board of Directors in accordance with the provisions of Companies Act, 2013 and SEBI (LODR) Regulations, 2015 is hosted on the company''s website at https://kapstonservices.com/investors/#policies

39. ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Central Government, various State Governments and Company''s Bankers and advisors for the valuable advice, guidance, assistance, co-operation, and encouragement they have extended to the Company from time to time. The Directors also take this opportunity to thank the Company''s Clients, partners, investors, Employees and all other Stakeholders, Regulators and Stock Exchange(s) for their consistent support to the Company.

Mar 31, 2018

Dear Shareholders,

The directors have pleasure in presenting their 10^th Annual Report on the business and operations of the company together with the audited financial statements for the year ended 31^st March 2018

(Rs. in Lakhs)

1. Financial Highlights

The Company''s operations during the year ended March 31,2018 are summarized in the table below

Particulars	Standalone
	2017-18	2016-17
Revenue form Operation	11102.84	9063.08
EBIDTA	1117.40	718.28
Less: Financial Cost	259.23	156.57
Less: Depreciation	120.63	110.73
Profit before prior period items	737.53	450.96
Prior period items	10.28	--
Profit before tax	747.82	450.96
Less: Current Tax	181.82	175.37
Add: Deferred Tax Asset	35.49	13.04
Profit Available for appropriations/Loss	601.50	288.63
Basic Earnings per Share	7.96	3.83
Diluted Earnings per share	7.96	3.83
Paid up share capital (face value of INR 10 each)	869.49	139.68
Reserves and Surpluses	1749.35	908.72

2. State of Affairs/ Companyâs Performance

Your Directors wish to present the details of Business operations done during the year under review:

The Company''s Revenue from operation for FY 2018 is Rs.11102.84 lakhs was higher by Rs.2039.76 lakhs over the last year. The Company has achieved EBIDTA (including other income) of Rs. 1117.40 Lakhs during the financial year 2018 as against that of EBIDTA of Rs.718.28 lakhs for the previous financial year 2017. The profit before tax for the financial year under review Rs.747.82 lakhs as against Rs. 450.96 lakhs for the previous financial year 2017. Profit after tax was positively impacted by the tax benefits availed under Section 80JJAA of the Income Tax Act,1961 and deferred tax benefits.

Your Directors express their satisfaction on the overall financial performance and the progress made on different areas by the Company during the year under review.

3. Initial Public Offering and Utilization of IPO Proceeds

During the year under review, the Company has completed an Initial Public offering (âIPOâ) of its share consisting of a fresh offer of 11,52,000 equity shares of Rs.10 each at a premium of Rs.82 per share and an offer for sale of 11,52,000 equity shares of Rs.10 at a premium of Rs.82 per share by selling shareholders.

The equity shares of the Company were listed on National Stock Exchange (Emerge) platform for SME listing effective from April 4 ,2018

The proceeds of the IPO have been utilized in the below manner: (Rs. In Lakhs)

NO	Particulars	Projected Utilization of funds as per prospectus	Actual Utilization of funds as on 12^th July, 2018
1	Part finance working capital requirements	660.75	660.75
2	Part Repayment of Unsecured Loans	200.00	200.00
3	Meet General Corporate Purposes	99.09	99.09
4	Meet issue Expenses	100.00	100.00
	Total	1059.84	1059.84

4. Dividend

Your Directors would like to use the profits earned for the purpose of enhancing business and hence do not propose any dividend for the financial year under review 2017-18.

5. Transfer to reserves

No amount has been transferred to reserves and the profit for the year has been retained in the profit and loss account.

6. Transfer of unclaimed dividend to investor education and protection fund

The provision of Section 125 of Companies Act,2013 is not applicable as the Company did not declare any dividend.

7. Share Capital

As on March 31, 2018, the authorized share capital of the Company is 90,000,000 divided into 90,00,000 equity shares of Rs. 10 each

During the year under review, the Company has allotted :

a. 2,79,367 Equity Shares of Rs.10 each pursuant to bonus issue as on August 05,2017.

b. 58,66,707 Equity Shares of Rs.10 each pursuant to bonus issue as on February 22,2018.

c. 11,52,000 Equity Shares of Rs.10 each pursuant to an initial public offering of the Company as on March 28, 2018.

As on March 31,2018, the paid-up share capital of the Company stood as Rs. 8,69,49,090 consisting of 86,94,909 equity shares of Rs.10 each.

8. Particulars of loans, guarantees and investments

During the year under review, your Company has not made any investment, given any loan or guarantee falling within the meaning of section 186 of the Companies Act,2013 and the rules made thereunder.

9. Public deposits

During the financial year under review your company has not accepted any deposits falling within the meaning of Section 73 of Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules,2014.

10. Particulars of contracts or arrangements with related party

During the financial year under review all transactions with the related parties are in compliance with the provisions of section 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

11. Risk Management

Risk management is the process of identification, assessment and prioritization of risks followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of unfortunate events to maximize the realization of opportunities. The company has initiated a process of preparing a comprehensive risk assessment and minimization procedure. These procedures are meant to ensure that executive management controls risk through means of a properly defined framework. The major risks are being identified by the company and its mitigation process/measures being formulated in areas of operations, recruitment, financial processes and reporting, human resources and statutory compliance.

12. Management discussion and analysis

The Management Discussion and Analysis Report for the year under review as stipulated in SEBI Listing Regulations is presented in a separate section forming part of this Annual Report.

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

The company being in the service industry does not have any power generation units and did not produce/generate any renewable or conventional power. The company does not have any foreign exchange earnings and outgo.

14. Material changes and commitment affecting financial position of the company from the end of the financial year till the date of the report

There is no material changes and commitment affecting financial position of the Company for the financial year 201718.

15. Disclosure under sexual harassment of women at workplace (prevention, prohibition, and redressal) Act,2013

The company is committed to provide a safe and conducive work environment to its employees and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provision of the sexual harassment of women at workplace (prevention, prohibition and redressal) Act,2013 and the rules made thereunder.

During the year under review, no complaints were reported as on date.

16. Committees of the board

The Board has three committees, the audit committee, the nomination and remuneration committee, the stakeholder''s relationship committee which are constituted as per the provisions of the Companies Act,2013, the details of the above-mentioned committees are as follows:

Audit Committee

S.No	Name of the Member	Position
1	Naveen Nandigam	Chairman
2	Vanitha Nagulavari	Member
3	Radha Krishna Pinnamaneni	Member

Nomination and Remuneration Committee

S.No	Name of the Member	Position
1	Vanitha Nagulavari	Chairman
2	Kanti Kiran Doddapaneni	Member
3	Naveen Nandigam	Member

Stakeholdersâ relationship committee

S.No	Name of the Member	Position
1	Radha Krishna Pinnamaneni	Chairman
2	Srikanth Kodali	Member

17. Meeting of the board of directors

During the financial year ended on 31^st March 2018, total Eighteen (18) board meetings were held on 2^nd June 2017, 20^th July 2017, 05^th August 2017, 26^th August 2017, 27^th October 2017, 11^th November 2017, 25^th November 2017, 18^th December 2017, 27^th December 2017, 11^th January 2018, 12^th January 201 8, 29^th January 2018, 8^th February 2018, 21^st February 2018, 22^nd February 2018, 5^th March,2018, 14^th March 2018, 28^th March,2018

18. Details of directors or key managerial personnel who were appointed or have resigned during the financial year 2017-18

On 29^th January 2018, Srikanth Kodali was appointed as Managing Director and Kanti Kiran Doddapaneni was appointed as whole-time director.

The following directors and key managerial personnel were appointed during the year under review

Date of appointment	DIN /PAN	Name	Designation
11^th January 2018	07420023	Kanti Kiran Doddapaneni	Director
22^nd February 2018	02096757	Chereddi Ramachandra Naidu	Independent Director
22^nd February, 2018	02726620	Naveen Nandigam	Independent Director
22^nd February, 2018	AIOPP9761H	Brendon Thomas Pereira	CFO
12^th January, 2018	BIJPG6881R	Amreen Gulnaaz	Company Secretary

In the board meeting held on 22^nd February,2018, Radha Krishna Pinnamaneni was re-designated as non-executive director of the company.

In the board meeting held on 30^th May,2018, Kanti Kiran Doddapaneni was re-designated as non-executive director of the company.

Dr. Chereddi Ramachandra Naidu was appointed as an Independent Director is re-designated as a Director pursuant to Section 152 of the Companies Act, 2013 and was appointed as an Executive Chairman with effect from 30^th August,2018 subject to the approval of Shareholders in the ensuing AGM.

Mrs. N Vanitha who meets the criteria for independence as provided in section 149(6) of the Act was appointed by the Board of Directors subject to the approval of Shareholders in the ensuing AGM for a term of 5 years with effect from 30^thAugust,2018.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Associations of the Company Mr. Radha Krishna Pinnamaneni, Director, retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible, offer himself for reappointment.

A brief profile of the director seeking reappointment and appointment form part of the notice of the ensuing Annual General Meeting.

19. Declaration by the Independent Directors :

During the year under review, the independent directors of the company have submitted their disclosures to the Board that they fulfil all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

20. Directors Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their Knowledge and ability, confirm that:

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

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

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

iv. The directors have prepared the annual accounts on a going concern;

v. The directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

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

Based on the framework of internal financial controls and compliance systems established and maintained by the company, work performed by the statutory and external consultants and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Company''s internal financial controls were adequate and effective during the financial year 2017-18.

21. Insider Trading Regulations

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended from time to time, the code of conduct for prohibition of insider trading, as approved by the board is implemented by the company. The company also adopts the concept of trading window closure, to prevent its directors, officers, designated employees, their relatives and other employees from trading in the securities of the company at the time when there is unpublished price sensitive information. The board has appointed Ms. Amreen Gulnaaz, Company Secretary as the Compliance Officer under the code.

22. Extract of Annual Return

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return of the Company for the financial year ended March 31,2018 is enclosed as Annexure I.

The extract of the annual return of the company is also hosted on the company''s website at https://www.kapstonfm.com/investors.html.

23. Statutory auditors

As per the provisions of Section 139 of the Companies Act,2013, the term of office of M/S NSVR and Associates LLP Chartered Accountants, as Statutory Auditors (who was appointed at the extra ordinary general meeting held on 29^th January, 2018) will conclude at the close of the forthcoming AGM of the company.

The board of directors places on records their appreciation for the services rendered by M/S NSVR and Associates LLP Chartered Accountants, based on the recommendation of audit committee subject to the approval of shareholders the board approved the appointment of M/S NSVR and Associates LLP Chartered Accountants, (Firm Registration No.0008801S/S200060), Hyderabad, as Statutory Auditor of the Company in their meeting held on 30^th August,2018 till the conclusion of 14^th Annual General Meeting, subject to approval of the shareholders.

Members'' attention is drawn to a Resolution proposing the appointment of M/S NSVR and associates LLP Chartered Accountants as Statutory Auditors of the Company which is included at Item No 3 of the Notice convening the Annual General Meeting.The Company has received a certificate from the Statutory Auditors to the effect that their appointment would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

24. Auditorsâ Report

The Auditors'' Report for fiscal 2018 does not contain any qualifications, reservations or adverse remarks. The Auditors'' Report is enclosed with the financial statements in this Annual Report.

25. Internal Financial Control

Your board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records, and the timely preparation of reliable financial disclosures. Your directors express their satisfaction and states that the company is having the adequate internal finance control system to the size of its operation.

26. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companyâs operations in future

During the year under review, there were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

27. Whistle blower policy

The company has established a vigil mechanism for reporting concerns through the whistle blower policy of the company. The policy provides for a framework and process, for the employees and directors to report genuine concerns or grievances about illegal and unethical behaviour. The whistle blower policy is available on the website of the Company (www.kapstonfm.com)

28. Particulars of employees

The information required under section 197 of the Companies Act,2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is presented in a separate section forming part of this annual report.

29. Corporate Social Responsibility

The provisions of section 135 of the Companies Act,2013 are not applicable to the Company during the Financial year under review (i.e FY 2017-18) , however the Company has voluntarily participated in Swachh Bharat Abhiyan in association with various corporates in and around the city of Hyderabad and have also arranged various Blood donation camps for the benefit of society at large.We hope to serve the local communities by taking up good projects as a part of our Corporate Social Responsibility.

30. Green initiatives

The Company sends the Annual Report to its members in electronic form, whose email addresses are registered the company/depository participants(s). For members who have not registered email addresses, physical copies are sent in the permitted mode.

In case of any change in your email address, you are requested to please inform the same to your Depository (in case you hold the shares in dematerialized form) or to the Company/RTA (in case you hold the shares in physical form).

31. Acknowledgement

Your Directors place on record their gratitude to the Central Government, various State Governments and Company''s Bankers and Advisors for the valuable advice, guidance, assistance, cooperation and encouragement they have extended to the Company from time to time. The Directors also take this opportunity to thank the company''s customers, suppliers and shareholders for their consistent support to the Company.

We place on record our appreciation for the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.

Place: Hyderabad For and on behalf of the Board

Date: 30.08.2018

Kanti Kiran Doddapaneni Srikanth Kodali

Director Managing Director

(DIN 07420023) (DIN 02464623)

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