Directors Report of Paras Defence and Space Technologies Ltd.

Mar 31, 2025

The Directors of your Company are pleased to present Sixteenth Annual Report on the business and operations of the Company along with the
Audited Financial Statements for the financial year ended March 31, 2025.

1. FINANCIAL SUMMARY AND HIGHLIGHTS

Particulars	Standalone		Consolidated
Particulars	FY 2024-25	FY 2023-24	FY 2024-25	FY 2023-24
Revenue from Operations	33,385.41	23,243.45	36,466.12	25,349.82
Other Income	1,185.63	934.00	792.22	827.17
Total Income	34,571.04	24,177.45	37,258.34	26,176.99
Less: Total Expenditure	25,890.21	19,715.17	28,901.01	22,124.45
Less: Share of (Profit)/Loss of associate	-	-	(2.75)	5.69
Profit Before Tax	8,680.83	4,462.28	8,360.07	4,046.85
Less: Income tax	2,269.94	1,250.58	2,304.59	1,256.79
Less: Deferred Tax	(96.03)	(100.21)	(93.67)	(103.32)
Less: Income Tax for earlier years	-	(111.59)	-	(110.41)
Profit after Tax	6,506.92	3,423.50	6,149.15	3,003.79
Other Comprehensive Income (net of taxes)	38.92	36.27	28.68	34.18
Total Comprehensive Income for the year	6,468.00	3,387.23	6,120.47	2,969.61

On standalone basis, the total income for the financial year
ended March 31, 2025 was ? 34,571.04 Lakhs, which is 42.99 %
more than the previous yearâs income of ? 24,177.45 Lakhs. Our
total income on consolidated basis for the financial year ended
March 31, 2025 was ? 37,258.34 Lakhs as against ? 26,176.99
Lakhs for the financial year ended March 31, 2024.

On standalone basis, the net profit after tax (PAT) for the
financial year ended March 31, 2025 stood at ? 6,506.92 Lakhs
as against previous yearâs net profit of ? 3,423.50 Lakhs thereby
recording an increase of 90.07%. Our net profit after tax (PAT)
on consolidated basis for the financial year ended March 31,
2025 amounted to ? 6,149.15 Lakhs as compared to ? 3,003.79
Lakhs in the previous year.

2. TRANSFER TO RESERVES

During the year under review, the Company has not transferred
any amounts to the general reserve. For complete details
on movement in Reserves and Surplus during the financial
year ended March 31, 2025, please refer to the âStatement of
Changes in Equityâ included in the standalone and consolidated
financial statements of this Annual Report.

3. DIVIDEND

Based on the Companyâs impressive performance, for the first
time in the history of the Company, the Board of Directors is
pleased to recommend a dividend of ? 0.50 per share of ? 5/-
each for the financial year ended March 31, 2025, subject to the
approval of the Members.

After the closure of the financial year, based on the approval of
the Board of Directors, the consent of the members was sought
by way of postal ballot, for sub-division/ split of 1 (one) equity
share of ? 10/- each into 2 (two) equity shares of ? 5/- each. The
members have approved the aforementioned split as on June
7, 2025. The record date for the purpose of the split of shares is
July 4, 2025. In view of the above, the face value of the share for
the purpose of declaration and payment of dividend has been
considered as ? 5/- per share.

The final dividend on equity shares, if approved by the
Members, would involve a cash outflow of ? 4.03 crores
(8,05,87,330 equity shares @ ? 0.50 per share). As per Indian
Income Tax Act, 1961, dividend paid and distributed by a
Company is taxable in the hands of members and the Company
is required to deduct tax at source (TDS) from dividend paid
to the Members at prescribed rates. The Record date for the
purpose of the final dividend for the financial year ended
March 31, 2025, is August 8, 2025.

The Company has in place a Dividend Distribution Policy
in accordance with Regulation 43A of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015
and the same is available on the Companyâs website at https://
parasdefence.com/investors.

4. STATE OF THE COMPANYâS AFFAIRS

The information on Companyâs affairs and related aspects
is provided under Management Discussion and Analysis
Report, which has been prepared, inter-alia, in compliance

with Regulation 34 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and forms part of this Report.

5. CHANGE IN THE NATURE OF BUSINESS

There were no changes in the nature of business during the
financial year ended March 31, 2025.

6. MATERIAL CHANGES AND COMMITMENT, IF ANY,
AFFECTING FINANCIAL POSITION OF THE COMPANY

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

7. PARTICULARS OF LOANS, GUARANTEES AND
INVESTMENTS

Particulars of loans given, investments made, guarantees
given and securities provided during the year and as covered
under Section 186 of the Companies Act, 2013 form part of the
notes to the standalone financial statements of the Company
provided in this annual report.

8. DEPOSITS

The Company has not accepted or renewed any amount falling
within the purview of provisions of Section 73 of the Companies
Act 2013 (âthe Actâ) read with the Companies (Acceptance of
Deposit) Rules, 2014 during the year under review. Hence, the
requirement of furnishing of details relating to deposits covered
under Chapter V of the Act or the details of deposits which are
not in compliance with Chapter V of the Act, is not applicable.

9. DETAILS OF SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES

A. SUBSIDIARIES

As on March 31, 2025, the Company has 6 (Six) Subsidiaries, out of which 5 (Five) are Indian Subsidiaries and 1 (One) is Foreign Subsidiary.
The details of the Subsidiaries are as follows:

Name of the Company	Type of Subsidiary	Date of Incorporation
*Opel Technologies Pte. Ltd.	Foreign Wholly Owned Subsidiary	02-Jan-2019
Paras Aerospace Private Limited	Indian Subsidiary	13-Feb-2019
Paras Anti-Drone Technologies Private Limited	Indian Subsidiary	25-Feb-2019
''Ayatti Innovative Private Limited	Indian Subsidiary	13-Aug-2018
Quantico Technologies Private Limited	Indian Wholly Owned Subsidiary	30-Dec-2023
Mechtech Thermal Private Limited	Indian Subsidiary	11-Jan-2024

*Opel Technologies Pte. Ltd. became a material subsidiary of your Company w.e.f. April 01, 2023.

#The Board of Directors of the Company at their meeting held on March 28, 2025, considered and approved the proposal for divestment of 58.02% equity stake held
in its subsidiary, Ayatti Innovative Private Limited (âAyattiâ), which comprises of 15,20,000 equity shares of face value of ? 10/- each. Post the transaction, Ayatti
will cease to be a subsidiary of the Company. The proposed transaction is likely to be completed latest by December 31, 2025, depending upon completion of due
diligence process by the proposed buyer.

Paras Green UAV Private Limited (formerly known as Paras Green Optics Private Limited) ceased to be a Subsidiary of the Company w.e.f. March 27, 2025

B. ASSOCIATE AND JOINT VENTURE COMPANIES

As on March 31, 2025, there are 2 (Two) Associate Companies
within the meaning of Section 2(6) of the Companies Act, 2013.

The details of the Associate/Joint Venture Companies
are as follows:

Name of the Company	Date of Incorporation
Krasny Paras Defence Technologies	10-Nov-2021
Private Limited
Controp-Paras Technologies	31-Jul-2023
Private Limited

10. PERFORMANCE AND FINANCIAL HIGHLIGHTS OF
SUBSIDIARY COMPANIES AND THEIR CONTRIBUTION
TO OVERALL PERFORMANCE OF THE COMPANY

The consolidated financial statements of the Company forms
a part of this Annual Report. A Statement containing salient
features of the financial statement of subsidiaries pursuant to

first proviso to Sub-Section (3) of Section 129 read with Rule 5
of Companies (Accounts) Rules, 2014 in the prescribed Form
AOC-1 are enclosed as Annexure - 1 to this report.

11. SHARE CAPITAL

A. Authorized Share Capital

The Authorised Share Capital of the Company is ? 6,050 Lakhs.
During the period under review, there was no change in the
authorised share capital of the Company.

B. Issued, Subscribed and Paid-up Share Capital

During the year, the Issued, Subscribed and Paid-up Share
Capital of the Company increased from ? 3,900 lakhs to ? 4,029
Lakhs in view of the 12,93,604 equity shares allotted vide the
Qualified Institutions Placement (QIP) in October 2024.

12. Employee Stock Option Plan - Paras Defence ESOP 2024

During the year under review, the Company sought
shareholdersâ approval at its 15^th Annual General Meeting for

the adoption and implementation of the Paras Defence and
Space Technologies Limited - Employee Stock Option Plan
- 2024 (âParas Defence ESOP 2024â). Under the scheme, the
total number of stock options to be granted shall not exceed
7,95,000 (Seven Lakhs Ninety-Five Thousand) in aggregate.
These options will entitle grantees to acquire, in one or more
tranches, up to 7,95,000 fully paid-up Equity Shares of the
Company, each having a face value of ?10/- (Rupees Ten Only).

The Plan includes provisions for extending and granting stock
options to eligible employees of the Company, its group
entities, including subsidiaries and/or associate companies
(excluding any employee who is a promoter or part of the
promoter group, as well as Independent Directors).

This initiative represents a reward system based on
performance, to attract and retain qualified, talented and
competent personnel and offer employees an opportunity
to participate in the Companyâs growth. By linking employee
performance with organizational initiatives, the Plan is
intended to enhance overall Company performance.

The Plan has been formulated in compliance with the
provisions of the Companies Act and the SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021
(âSBEB&SE Regulationsâ). The Nomination and Remuneration
Committee (NRC) oversees the administration of the Plan and
acts as the Compensation Committee in accordance with the
SBEB&SE Regulations.

During the financial year 2024-25, there has been no change
to the Paras Defence ESOP 2024 scheme. In FY 2024-25, the
Company granted a total of 78,450 options. No options were
vested or exercised during the year. Further details regarding
the scheme are provided in the Financial Statements section
of this Annual Report.

In view of the shareholdersâ approval sought by way of postal
ballot in June 2025 for the sub-division/ split of 1 (One) Equity

Share of the Company of the face value of ? 10/- (Rupees Ten
Only) each fully paid up into 2 (Two) Equity Shares of the
Company of face value of ? 5/- (Rupees Five Only) each fully
paid up, the shareholders have inter alia also authorised
the Board of Directors to make appropriate adjustments to
ensure fair and reasonable adjustment to the entitlement
of the participants under the âParas Defence ESOP 2024â of
the Company due to sub-division/split of equity shares as
aforesaid to the outstanding stock options (whether vested
or unvested as on the Record Date) in accordance with the
SEBI (Share Based Employee Benefits and Sweat Equity)
Regulations, 2021, as amended from time to time.

The disclosure relating to ESOPs required to be made under
the provisions of the Companies Act, 2013 and the Rules
made thereunder and the Securities and Exchange Board
of India (Share Based Employee Benefit and Sweat Equity)
Regulations, 2021 (SBEB Regulations) is provided on the
website of the Company. A certificate from the Secretarial
Auditors confirming that the scheme has been implemented in
compliance with the SBEB Regulations has also been obtained.
These documents are available for electronic inspection by
Members during the AGM and can also be accessed on the
Companyâs website at https://www.parasdefence.com

13. OTHER SHARES RELATED DISCLOSURES

During the year under review, the Company has not issued any
bonus shares, equity shares with differential voting rights nor
has granted any sweat equity. As on March 31, 2025, none of
the Directors of the Company hold instruments convertible
into equity shares of the Company.

14. ISSUE OF DEBENTURES, BONDS AND ANY OTHER
NON-CONVERTIBLE SECURITIES/WARRANTS

During the year under review, the Company has not issued any
debentures, bonds and any other non-convertible securities
nor Company has issued any warrants.

15. CREDIT RATING

During the year under review, your Company has been rated by CRISIL Ratings Limited (âCRISILâ) and ICRA Limited for its bank
facilities as follows:

CRISIL Ratings Limited
Instrument Type	Amount (? in Cr.)	Rating Outlook	Rating Action
Bank Guarantee	23.00	CRISIL A2
Cash Credit	39.00	CRISIL A-/ Stable
Letter of Credit	5.00	CRISIL A2	D Reaffirmed
Long Term Loan	10.00	CRISIL A-/Stable
Pre-Shipment Credit	7.00	CRISIL A2
Proposed Term Loan	19.00	CRISIL A- / Stable

ICRA Limited
Instrument Type	Amount (? in Cr.)	Rating Outlook	Rating Action
Long term - Fund Based - Cash Credit	39.00	ICRA A- (Stable)	Reaffirmed the ratings and revised the
Long term - Fund based - Overdraft	5.00	ICRA A- (Stable)	Outlook from âNegativeâ to âStableâ
Long term/Short term - Non-Fund Based - Bank Guarantee	157.75	ICRA A- (Stable)/ICRA A2

16. UTILISATION OF QUALIFIED INSTITUTIONS PLACEMENT (QIP) PROCEEDS

During the year under review, the Company raised funds amounting to ? 135.182 Crores by way of Qualified Institutions Placement (QIP)
and allotted 12,93,604 equity shares at an issue price of ? 1,045 per equity share (including a premium of ? 1,035 per equity share) on
October 08, 2024.

The issue was undertaken in accordance with Sections 42 and 62 of the Companies Act, 2013, along with the applicable rules made
thereunder and the provisions of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018.

The proceeds of funds raised under QIP of the Company are being utilised as per Objects of the Issue. ICRA Limited is the Monitoring
Agency, who is monitoring the use of the net QIP proceeds, in accordance with the objects of the issue.

The disclosure in compliance with the Regulation 32(7A) of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015
(âListing Regulationsâ) is as under:

Sr. No.	Particulars	Actual utilization of QIP proceeds upto March 31, 2025 (? crores)
1.	Funding working capital requirements of the Company	120.000
2.	General corporate purposes (excluding QIP expenses)	5.530
3.	Issue expenses	4.195
	Total	129.725

Out of the total funds raised by the Company under the QIP, an amount of ? 5.46 crores is yet to be utilized, as on March 31, 2025.

17. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has in place adequate internal financial controls with reference to the financial statements. The Audit Committee reviews
the internal control systems at regular intervals internally, the adequacy of internal audit functions and the significant internal audit
findings with the management and also updates and recommends the same to the Board for their review.

18. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Composition of Board of Directors

The composition of Board of Directors of the Company, as on March 31, 2025, is as follows:

Name of Director	DIN	Category
Sharad Virji Shah	00622001	Promoter, Chairman & Non-Executive Non- Independent Director
Munjal Sharad Shah	01080863	Promoter, Managing Director
Shilpa Amit Mahajan	01087912	Whole-Time Director
Manmohan Handa	06942720	Non-Executive Independent Director
Hina Amol Gokhale	08712659	Non-Executive Independent Director
Suresh Katyal	08979402	Non-Executive Independent Director

B. Changes in the position of Directors of the Company

The details of change in position of Directors of the Company, during the year under review, are given in the table as hereunder:

Name of
Director

Designation

Nature of Change

(Appointment/

Re-appointment/Cessation)

Date of Shareholders
Approval

Tenure

Hina Amol
Gokhale

Non-Executive Woman
Independent Director

Re-appointment

March 17, 2025

For a second term of five years
commencing from April 01, 2025
to March 31, 2030

C. Retirement by rotation and subsequent reappointment

In accordance with the provisions of Section 152 of the
Companies Act, 2013 and the Companyâs Articles of
Association, Mr. Sharad Virji Shah (DIN: 00622001), retires by
rotation at the forthcoming Sixteenth Annual General Meeting
and being eligible has offered himself for reappointment.

D. Key Managerial Personnel (KMP)

The composition of Key Managerial Personnel of the Company
as on March 31, 2025 is as follows:

Name of Key Managerial Personnel	Category
Munjal Sharad Shah	Managing Director
Shilpa Amit Mahajan	Whole-Time Director
Harsh Dhirendra Bhansali	Chief Financial Officer
Jajvalya Raghavan	Company Secretary and Compliance Officer

E. Changes in the position of Key Managerial Personnel
other than Directors of the Company

During the period under review, there was no change in the
position of the Key Managerial Personnel of the Company.

F. Declarations Given by Independent Directors

The Company has received necessary declarations and
disclosures from the Independent Directors under Section
149(7) and Section 184(1) of the Companies Act, 2013 (âthe
Actâ) stating that they meet the criteria of independence as
laid down in Section 149(6) of the Act and under the applicable
provisions of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ)
and disclosing their interest in form MBP-1. All the Directors
have certified that the disqualifications mentioned under
Sections 164, 167 and 169 of the Act do not apply to them.
The Independent Directors have complied with the Code for
Independent Directors prescribed in Schedule IV of the Act.

The Board of the Company has taken the disclosures on record
after verifying the due veracity of the same. In the opinion of
the Board, all the Independent Directors possess the integrity,
expertise and experience including the proficiency required to
be Independent Directors of the Company, fulfil the conditions
of independence as specified in the Act and the SEBI Listing
Regulations and are independent of the management and
have also complied with the Code for Independent Directors
as prescribed in Schedule IV of the Act. All the Independent
Directors of the Company are also registered with the
databank of Independent Directors as required under the
provisions of the Act.

During the year under review, the Non-Executive Directors of
the Company had no pecuniary relationship or transactions
with the Company, other than sitting fees and reimbursement
of expenses, if any.

The Directors and the senior management personnel have
affirmed compliance with the Code of Conduct for Directors and
Senior Management Personnel during the year under review.

G. Board and Committee Meetings

I. Board Meetings

The Board of Directors met 10 (Ten) times during the
financial year under review. The details of the Board
meetings and attendance of each Director thereat are
provided in the Corporate Governance Report forming
part of the Annual Report as Annexure - 2.

II. Committees of the Board

The Company has 5 (Five) Board-Level Committees,
which have been established in compliance with the
provisions of the Act and SEBI Listing Regulations:

i. Audit Committee

The Companyâs Audit Committee composition
is in line with the requirements of Section 177 of
the Companies Act, 2013 and Regulation 18 of the
Listing Regulations.

The Members of the Audit Committee are financially
literate and have requisite accounting and financial
management expertise. The composition, terms
of reference of the Audit Committee and the
particulars of meetings held and attendance
thereat are mentioned in the Corporate Governance
Report forming part of the Annual Report. During
the year under review, all the recommendations of
the Audit Committee in terms of its reference were
considered positively by the Board of Directors
of your Company.

ii. Other Committees

The details of other Committees of the Board are
given under the Report on Corporate Governance
section forming part of this Annual Report
and the list of Committees of the Board is also
available on the website of the Company viz. www.
parasdefence.com/investors

19. COMPLIANCE WITH SECRETARIAL STANDARDS

During the period from April 01, 2024 to March 31, 2025, the
Company complied with the Secretarial Standard - 1 on Board
Meetings and Secretarial Standard - 2 on General Meetings,
issued by the Institute of Company Secretaries of India.

20. SUSTAINABILITY AND CORPORATE SOCIAL
RESPONSIBILITY (CSR)

The Companyâs Sustainability, Environment, Social and
Governance Report is provided separately as part of
the Annual Report.

The brief outline of the Companyâs CSR initiatives undertaken
during the year under review is furnished in Annexure-3 in
the format as prescribed in the Companies (Corporate Social
Responsibility Policy) Rules, 2014, as amended from time to
time. The Companyâs CSR Policy is placed on the website of the
Company https://parasdefence.com/investors .

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

21. PARTICULARS OF CONTRACTS OR ARRANGEMENTS
WITH RELATED PARTIES

In line with the requirements of the Companies Act, 2013
and SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (âSEBI Listing Regulationsâ), the Company
has formulated a Policy on Related Party Transactions and
the same can be accessed using the following link: https://
parasdefence.com/investors

During the year under review, all other contracts /
arrangements / transactions entered by the Company with
Related Parties were in the ordinary course of business and
on an armâs length basis. A statement giving details of all
Related Party Transactions, as approved, is placed before the
Audit Committee for review on a quarterly basis. The details of
the transactions entered into between the Company and the
related parties under Sections 188 and 134(3)(h) of the Act, are
given in AOC - 2 enclosed as Annexure - 4 to this report.

The Disclosures as required under Indian Accounting Standard

- 24 (Ind AS-24) âRelated Party Disclosuresâ notified under Rule
7 of the Companies (Accounts) Rules, 2014 have been provided
in notes forming part of the Standalone Financial Statements.

22. PARTICULARS OF REMUNERATION OF DIRECTORS,
KEY MANAGERIAL PERSONNEL (KMP) AND
EMPLOYEES AND DISCLOSURES IN BOARDâS
REPORT

The information required under Rule 5(2) of The Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, is provided in this Report. In terms of proviso
to Section 136 of the Companies Act, 2013, the Report and
Accounts are being sent to the members excluding the certain
information covered under aforesaid Annexure. Any member
interested in obtaining the same may write to the Company
Secretary at the Registered Office of the Company. None of
the employees listed in the said Annexure - 5 is related to any
Director of the Company except to the extent specified in the
financial statements.

The disclosure on remuneration of Directors, Key Managerial
Personnel and Employees as required under the Companies
Act, 2013 and Rules made thereunder is enclosed as Annexure

- 5 to this Report.

23. MANAGEMENT DISCUSSION AND ANALYSIS

In terms of provisions of Regulation 34(2)(e) and Schedule V
of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, a Management Discussion and Analysis
Report is enclosed as Annexure - 6 to this Report.

24. ANNUAL EVALUATION OF BOARD PERFORMANCE
AND PERFORMANCE OF ITS COMMITTEES AND
INDIVIDUAL DIRECTORS

In accordance with the provisions of the Companies Act,
2013 and the Listing Regulations, the Board of Directors
carried out an annual evaluation of its overall performance,
that of individual directors, and the functioning of its various
Committees. The performance of the Board as a whole and of its
Committees was evaluated by the Board through a structured
questionnaire covering multiple aspects such as composition
and quality, meeting and procedures, contribution to Board
deliberations, effectiveness of assigned functions, rapport with
management, professional development and the adequacy,
appropriateness and timeliness of information etc.

Taking into consideration the responses received from the
Individual Directors to the questionnaire, the performance of
the Board and its Committees was evaluated. The performance
of the Independent Directors was evaluated by the entire
Board, excluding the respective Independent Director
evaluated. The Directors expressed their satisfaction with the
evaluation process.

Pursuant to Schedule IV of the Companies Act, 2013, a separate
meeting of the Independent Directors was held on Friday,
January 10, 2025.

25. CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE EARNINGS
AND OUTGO

The information on conservation of energy, technology
absorption and foreign exchange earnings and outgo
stipulated under Section 134(3)(m) of the Companies Act, 2013
read with Rule 8 of the Companies (Accounts) Rules, 2014 is
enclosed as Annexure - 7 to this report.

26. AUDITORS

I. Statutory Auditors

In accordance with the provisions of the Companies Act,
2013, M/s. Chaturvedi & Shah LLP, Chartered Accountants
(FRN: 101720W/W100355) (âC&Sâ) have been appointed
as the Statutory Auditors of the Company, for a period
of five years i.e. until the conclusion of 19^th AGM of the
Company to be held in the year 2028. The Auditors have
confirmed that they are not disqualified from continuing
as Auditors of the Company.

II. Internal Auditors

The provisions of Section 138 of the Companies Act,
2013 for appointing Internal Auditors are applicable
to the Company.

Based on the recommendation of the Audit Committee,
the Board of Directors had appointed M/s. Shaparia Mehta
& Associates LLP, Chartered Accountants (FRN: 0112350W
/ W-100051), as Internal Auditors for conducting the
internal audit functions of the Company for FY 2024Â¬
25. They have submitted their reports periodically to
the Audit Committee and Board of Directors for their
review. M/s. Shaparia Mehta & Associates LLP have
been appointed as the Internal Auditors of the Company
for FY 2025-26.

III. Secretarial Auditors

During the year under review, the Board of Directors had
appointed M/s. DM & Associates, Company Secretaries
LLP (FRN: L2017MH003500), Practicing Company
Secretaries as the Secretarial Auditors to conduct
secretarial audit of the Company for the financial year
2024-25. The Secretarial Audit report in Form MR-3 as
issued by them is enclosed as Annexure - 8 to this Report.
The comments provided by them are self-explanatory
and hence do not require comments from the Board.

The Secretarial Audit was not applicable to any of the
subsidiaries of the Company during the year under review.

Pursuant to the amended provisions of Regulation
24A of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and Section 204 of the
Companies Act, 2013, read with Rule 9 of the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Audit Committee and the
Board of Directors have approved and recommended
the appointment of M/s. DM & Associates, Company
Secretaries LLP (FRN: L2017MH003500), Practicing
Company Secretaries as the Secretarial Auditors of the
Company for a term of 5 (Five) consecutive years from
the FY 2025-26 till FY 2029-30, subject to the approval of
the Members at ensuing AGM.

Brief profile and other details of M/s. DM & Associates,
Company Secretaries LLP, are disclosed in the AGM
Notice approved by the Board. They have given their
consent to act as Secretarial Auditors of the Company
and have confirmed their eligibility for the appointment.
The Secretarial Auditors have confirmed that they
have subjected themselves to the peer review process
of Institute of Company Secretaries of India (ICSI)
and hold valid certificate issued by the Peer Review
Board of the ICSI.

IV. Cost Auditors

The provisions of Section 148 of the Companies Act, 2013
for maintaining the Cost Records are applicable to the
Company and accordingly the Company has maintained

cost accounts and records in respect of the applicable
products for the year ended March 31, 2025.

The Board, on the recommendation of the Audit
Committee, at its meeting held on April 30, 2025,
has approved the appointment of M/s. Dinesh Jain &
Company, Practicing Cost Accountants, Mumbai (FRN:
100583), as the Cost Auditors for the Company for the
financial year ending March 31, 2026. They have confirmed
their independent status and that they are free from any
disqualifications under Section 141 of the Companies
Act, 2013. A proposal for ratification of remuneration of
the Cost Auditors for the FY 2025-26 is placed before the
shareholders for approval in the ensuing AGM.

27. AUDIT REPORTS

The Statutory Auditorsâ Report and the Secretarial Auditorsâ
Report do not contain any qualification, reservation, adverse
remark or disclaimer.

The Statutory Auditors have issued an unmodified opinion on
the Financial Statements, both standalone and consolidated,
for the financial year ended March 31, 2025. Their Reports
for the financial year ended March 31, 2025 on the financial
statements of the Company forms part of this Annual Report.
There is no incident of fraud, requiring reporting by the
Statutory Auditors under Section 143(12) of the Act.

In view of the above, no comments are offered by the
Board of Directors.

28. ANNUAL RETURN

In compliance with Section 92(3) of the Companies Act, 2013
(âthe Actâ) read with Section 134(3) of the Act, the Annual
Return of the Company as on March 31, 2025 will be available
on the website of the Company at https://parasdefence.com/
investors?tab=1

29. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the
Directors, based on the representations received from the
operating management and after due enquiry, confirm that:

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

b) they 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 March 31, 2025 and of the profit of
the Company for that period;

c) they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies Act,
2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts 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 are operating effectively; and

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

30. HUMAN RESOURCES / INDUSTRIAL RELATIONS,
INCLUDING NUMBER OF PEOPLE EMPLOYED

Your Company had 537 permanent employees as on March
31, 2025 while the count was 418 as on March 31, 2024. Your
Company provides regular training to employees to improve
skills. Your Company has put in place a performance appraisal
system that covers all employees.

31. CORPORATE GOVERNANCE

The Company has complied with the corporate governance
requirements under the Companies Act, 2013, and as
stipulated under the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ).
A separate section on corporate governance under the SEBI
Listing Regulations, along with the certificate from the
Practicing Company Secretary confirming the compliance, is
enclosed as Annexure - 2D of this report.

32. COMPANYâS POLICY RELATING TO DIRECTORSâ
APPOINTMENT, PAYMENT OF REMUNERATION AND
DISCHARGE OF THEIR DUTIES

Your Company has adopted a policy relating to appointment
of Directors, payment of managerial remuneration, Directorsâ
qualifications, positive attributes, independence of Directors
and other related matters as provided under Section 178(3) of
the Companies Act, 2013.

33. RISK MANAGEMENT POLICY

In line with regulatory requirements, the Company has framed
risk management policy to identify and access with the
regulatory risk areas and a risk mitigation process. A detailed
exercise is being carried out at regular intervals to identify,
evaluate, manage and monitor all business risks. The Company
has a Risk Management Committee in place which periodically
reviews the risks and suggests steps to be taken to control and
mitigate the same through a properly defined framework.

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

workplace and preventing and redressing complaints of sexual
harassment and it covers matters connected or incidental
thereto. The Company has complied with the provisions
relating to the constitution of Internal Committee under the
Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.

The details of the POSH Compliances during the year

Number of sexual harassment complaints received : Nil
Number of complaints disposed off : Nil

Number of cases pending for more than 90 days : Nil

During the year under review, the Company has not received
any complaint of sexual harassment.

35. COMPLIANCE WITH THE MATERNITY BENEFIT
ACT, 1961

With a significant percentage of women in its workforce, the
Company believes that it is not merely about empowering
women â rather, PARAS is empowered by them. The Company
is committed to supporting the needs, health and safety of
mothers and complies with the provisions of the Maternity
Benefit Act, 1961.

36. WHISTLE BLOWER POLICY / VIGIL MECHANISM

Pursuant to Section 177(9) read with Regulation 22 of the
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, your Company has duly established Whistle
Blower Policy /Vigil Mechanism Policy (âPolicyâ) to report
to the management instances of unethical behavior, actual
or suspected, fraud or violation of the Companyâs code of
conduct. The functioning of the Policy is reviewed by the Audit
Committee / Board on periodical basis. During the financial
year ended March 31, 2025, the Company has not received any
complaint under the Whistle Blower Policy of the Company.

37. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct
which is applicable to the members of the Board of Directors
and Senior Management Personnel. It is confirmed that all
Directors and Senior Management Personnel have affirmed
their adherence to the provisions of the Code of Conduct
during the financial year 2024-25.

38. POLICIES AND DISCLOSURE REQUIREMENTS

In terms of provisions of the Companies Act, 2013 and
provisions of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Company has adopted
the policies, which are available on Companyâs website -
https://parasdefence.com/investors

39. BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT (BRSR)

The Company has provided Business Responsibility and
Sustainability Report in line with the requirement based

on SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 (âSEBI Listing Regulationsâ) and the
âNational Voluntary Guidelines on Social, Environmental and
Economic Responsibilities of Businessâ notified by Ministry
of Corporate Affairs (MCA). Pursuant to the provisions of
Regulation 34 of the SEBI Listing Regulations, the said report
is attached separately, which forms part of this Annual Report.

40. SIGNIFICANT AND MATERIAL ORDERS PASSED BY
THE REGULATORS OR COURTS OR TRIBUNAL

During the year, there were no significant material orders
passed by the Regulators / Courts / Tribunals which would
impact the going concern status of the Company and its
future operations.

41. DIFFERENCE BETWEENAMOUNT OF THE VALUATION
DONE AT THE TIME OF ONE TIME SETTLEMENT AND
THE VALUATION DONE WHILE TAKING LOAN FROM
THE BANKS OR FINANCIAL INSTITUTIONS ALONG
WITH THE REASONS THEREOF

During the year under review, there was no instance of oneÂ¬
time settlement with banks or financial institutions, hence

the requirement to disclose the details of difference between
the amount of the valuation done at the time of one-time
settlement and the valuation done while taking loan from the
Banks or Financial Institutions, along with the reasons thereof,
is not applicable.

42. IBC CODE & ONE-TIME SETTLEMENT

There is no proceeding pending against the Company under
the Insolvency and Bankruptcy Code, 2016 (IBC Code). There
has not been any instance of one-time settlement of the
Company with any bank or financial institution.

43. ACKNOWLEDGEMENTS

Your Board takes this opportunity to thank all its employees
for their dedicated service and firm commitment to the goals
of the Company. Your Board also wishes to place on record its
sincere appreciation for the wholehearted support received
from members, clients, bankers and all other business
associates. We look forward to continued support of all these
partners in progress.

For and on behalf of the Board of Directors
Paras Defence and Space Technologies Limited

Sharad Virji Shah Munjal Sharad Shah

Chairman & Non- Executive Director Managing Director

DIN:00622001 DIN:01080863

Date: July 25, 2025
Place: Navi Mumbai

Registered Office:

D-112, TTC Industrial Area, MIDC, Nerul, Navi Mumbai - 400706

Tel. No. 91-22-6919 9999

Fax No. 91-22-6919 9990

E-mail: [email protected]

Website: www.parasdefence.com

CIN: L29253MH2009PLC193352

Mar 31, 2024

The Directors of your Company are pleased to present Fifteenth Annual Report on the business and operations of the Company along with the Audited Financial Statements for the financial year ended March 31, 2024.

1. FINANCIAL SUMMARY AND HIGHLIGHTS

(? in Lakhs)
Particulars	Standalone		Consolidated
Particulars	FY 2023-24	FY 2022-23	FY 2023-24	FY 2022-23

Revenue from Operations	23,243.45	21,427.96	25,349.82	22,242.59
Other Income	934.00	833.30	827.17	822.43
Total Income	24,177.45	22,261.26	26,176.99	23,065.02
Less: Total Expenditure	19,715.17	17,588.57	22,124.45	18,367.39
Less: Share of loss of associate	-	-	5.69	13.13
Profit Before Tax	4,462.28	4,672.69	4,046.85	4,684.50
Less: Income tax	1,250.58	1,173.48	1,256.79	1,185.41
Less: Deferred Tax	(100.21)	(28.87)	(103.32)	(30.21)
Less: Income Tax for earlier years	(111.59)	(64.74)	(110.41)	(64.74)
Profit after Tax	3,423.50	3,592.82	3,003.79	3,594.04
Other Comprehensive Income (net of taxes)	36.27	6.08	34.18	-
Total Comprehensive Income for the year	3,387.23	3,586.74	2,969.61	3,594.04

On standalone basis, the total income for the financial year ended March 31, 2024 was ? 24,177.45 Lakhs, which is 8.61 % more than the previous yearâs income of ? 22,261.26 Lakhs. Our total income on consolidated basis for the financial year ended March 31, 2024 was ? 26,176.99 Lakhs as against ? 23,065.02 Lakhs for the financial year ended March 31, 2023.

On standalone basis, the net profit after tax (PAT) for the financial year ended March 31, 2024 stood at ? 3,423.50 Lakhs as against previous yearâs net profit of ? 3,592.82 Lakhs thereby recording a decline of 4.71 %. Our net profit after tax (PAT) on consolidated basis for the financial year ended March 31, 2024 amounted to ? 3,003.79 Lakhs as compared to ? 3,594.04 Lakhs in the previous year.

2. TRANSFER TO RESERVES

The Board of Directors has decided to retain the entire amount of profits for FY 2023-24 in the Retained Earnings.

3. DIVIDEND AND TRANSFER TO IEPF

The Board of Directors has not recommended dividend on equity shares for the FY 2023-24. The Company was not required to transfer any unpaid / unclaimed amount of dividend to IEPF during the financial year ended March 31, 2024.

The Company has in place a Dividend Distribution Policy in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same is available on the Companyâs website at https://www. parasdefence.com/investors.

4. STATE OF THE COMPANYâS AFFAIRS

The information on Companyâs affairs and related aspects is provided under Management Discussion and Analysis Report, which has been prepared, inter-alia, in compliance with Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and forms part of this Report.

5. CHANGE IN THE NATURE OF BUSINESS

There were no changes in the nature of business during the financial year ended March 31, 2024.

6. MATERIAL CHANGES AND COMMITMENT, IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANY

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

7. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Particulars of loans given, investments made, guarantees given and securities provided during the year and as covered under Section 186 of the Companies Act, 2013 form part of the notes to the standalone financial statements of the Company provided in this annual report.

8. DEPOSITS

The Company has not accepted or renewed any amount falling within the purview of provisions of Section 73 of the Companies Act 2013 (âthe Actâ) read with the Companies (Acceptance of Deposit) Rules, 2014 during the year under review. Hence, the requirement for furnishing of details relating to deposits covered under Chapter V of the Act or the details of deposits which are not in compliance with Chapter V of the Act is not applicable.

9. DETAILS OF SUBSIDIARY, ASSOCIATE AND JOINT VENTURE COMPANIES

A. SUBSIDIARIES

As on March 31, 2024, the Company has 7 (Seven) Subsidiaries, out of which 6 (Six) are Indian Subsidiaries and 1 (One) is Foreign Subsidiary. The details of the Subsidiaries are as follows:

Name of the Company	Type of Subsidiary	Date of Incorporation
"Paras Green UAV Private Limited	Indian Wholly Owned Subsidiary	29/10/2018
*Opel Technologies Pte. Ltd.	Foreign Wholly Owned Subsidiary	02/01/2019
Paras Aerospace Private Limited	Indian Subsidiary	13/02/2019
Paras Anti-Drone Technologies Private Limited	Indian Subsidiary	25/02/2019
Ayatti Innovative Private Limited	Indian Subsidiary	13/08/2018
Quantico Technologies Private Limited	Indian Wholly Owned Subsidiary	30/12/2023
Mechtech Thermal Private Limited	Indian Subsidiary	11/01/2024
#Name of the Company has been changed from âParas Green Optics Private Limitedâ to *Opel Technologies Pte. Ltd. became a material subsidiary of your Company w.e.f. April	âParas Green UAV Private Limitedâ w.e.f. February 23, 2024. 01, 2023.

B. ASSOCIATE COMPANIES

As on March 31, 2024, there are 2 (Two) Associate Companies within the meaning of Section 2(6) of the Companies Act, 2013. The details of the Associate Companies are as follows:

C. JOINT VENTURE

As on March 31, 2024, there is no Joint Venture within the meaning of Section 2(6) of the Companies Act, 2013.

10. PERFORMANCE AND FINANCIAL HIGHLIGHTS OF SUBSIDIARY COMPANIES AND THEIR CONTRIBUTION TO OVERALL PERFORMANCE OF THE COMPANY

The consolidated financial statements of the Company forms a part of this Annual Report. A Statement containing salient features of the financial statement of subsidiaries pursuant to first proviso to Sub-Section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1 are enclosed as Annexure - 1 to this report.

11. SHARE CAPITAL

A. Authorized share capital

The Authorised Share Capital of the Company is H 6,050 Lakhs. During the period under review, there was no change in the authorised share capital of the Company.

B. Issued, Subscribed and Paid-up Share Capital

The Issued, Subscribed and Paid-up Share Capital of the Company is H 3,900 Lakhs. During the period under review, no allotment of securities have been made by the Company.

12. BONUS SHARES/ EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS/ESOP/SWEAT EQUITY

During the year under review, the Company has not issued any equity shares with differential voting rights nor has granted any stock options or sweat equity.

As on March 31, 2024, none of the Directors of the Company hold instruments convertible into equity shares of the Company.

13. ISSUE OF DEBENTURES, BONDS AND ANY OTHER NON-CONVERTIBLE SECURITIES/WARRANTS

During the year under review, the Company has not issued any debentures, bonds and any other non-convertible securities nor Company has issued any warrants.

Name of the Company	Date of Incorporation
Krasny Paras Defence Technologies Private Limited	10/11/2021
Controp-Paras Technologies Private Limited	31/07/2023

14. CREDIT RATING
During the year under review, your Company has been rated by CRISIL Ratings Limited (âCRISILâ) for its bank facilities as follows:
CRISIL Ratings Limited
Instrument Type	Size of Issue (? in Cr.) Rating Outlook		Rating Action
Bank Guarantee	23.00	CRISIL A2	Reaffirmed
Cash Credit	39.00	CRISIL A-/ Stable	Upgraded / Outlook revised to Stable from Positive
Letter of Credit	5.00	CRISIL A2	Reaffirmed
Long Term Loan	10.00	CRISIL A-/Stable	Upgraded / Outlook revised to Stable from Positive
Pre Shipment Credit	7.00	CRISIL A2	Reaffirmed
Proposed Term Loan	19.00	CRISIL A- / Stable	Upgraded / Outlook revised to Stable from Positive

15. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has in place adequate internal financial controls with reference to the financial statements. The Audit Committee reviews the internal control systems at regular intervals internally, the adequacy of internal audit function and significant internal audit findings with the management, also update and recommend the same to the Board for their review.

16. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Composition of Board of Directors

The composition of Board of Directors of the Company as on March 31, 2024 is as follows:

Name of Director	DIN	Category
Sharad Virji Shah	00622001	Promoter, Chairman & Non-Executive Non- Independent Director
Munjal Sharad Shah	01080863	Promoter, Managing Director
Shilpa Amit Mahajan	01087912	Whole-Time Director
Manmohan Handa	06942720	Non-Executive Independent Director
Hina Amol Gokhale	08712659	Non-Executive Independent Director
Suresh Katyal	08979402	Non-Executive Independent Director

B. Changes in the position of Directors of the Company

The details of change in position of Directors of the Company, during the year under review, are given in the table as hereunder:

Name of Director	Designation	Nature of Change (Appointment/ Reappointment/Cessation)	Date of Shareholders Approval	Tenure
Mr. Munjal Sharad Shah (DIN: 01080863)	Managing Director	Reappointment	November 20, 2023	For a period of 5 (five) years effective from March 14, 2024 to March 13, 2029
Mrs. Shilpa Amit Mahajan (DIN: 01087912)	Whole-Time Director	Reappointment	September 29,2023	For a period of 5 (five) years with effect from September 29, 2023 to September 28, 2028
Mr. Manmohan Handa (DIN:06942720)	Non-Executive Independent Director	Reappointment	November 20, 2023	For a second term of five years commencing from January 07, 2024 to January 06, 2029

C. Retirement by rotation and subsequent reappointment

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Companyâs Articles of Association, Mr. Munjal Sharad Shah (DIN: 01080863), retires by rotation at the forthcoming Fifteenth Annual General Meeting and being eligible has offered himself for reappointment.

D. Key Managerial Personnel (KMP) The composition of Key Managerial Personnel of the Company as on March 31, 2024 is as follows:
Name of Key Managerial Personnel	Category
Munjal Sharad Shah	Managing Director
Shilpa Amit Mahajan	Whole-Time Director
Harsh Dhirendra Bhansali	Chief Financial Officer
Jajvalya Raghavan	Company Secretary and Compliance Officer

E. Changes in the position of Key Managerial Personnel other than Directors of the Company

The details of change in position of Key Managerial Personnel of the Company during the year under review are given in the table as hereunder:

Name of Key Managerial Personnel	Designation	Nature of Change (Appointment/Cessation)	Date of Appointment/ Cessation
Jajvalya Raghavan	Company Secretary and Compliance Officer	Appointment	February 09, 2024
Hemalkumar Hiranbhai Sagalia	Company Secretary and Compliance Officer	Cessation	December 13, 2023

Apart from the above, there was no other change in the composition of the Key Managerial Personnel during the period under review.

F. Declarations Given by Independent Directors

The Company has received necessary declarations and disclosures from the Independent Directors under Section 149(7) and Section 184(1) of the Companies Act, 2013 (âthe Actâ) stating that they meet the criteria of independence as laid down in Section 149(6) of the Act and under the applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ) and disclosing their interest in form MBP-1. All the Directors have certified that the disqualifications mentioned under Sections 164, 167 and 169 of the Act do not apply to them. The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV of the Act.

The Board of the Company has taken the disclosures on record after verifying the due veracity of the same. In the opinion of the Board, all the Independent Directors possess the integrity, expertise and experience including the proficiency required to be Independent Directors of the Company, fulfil the conditions of independence as specified in the Act and the SEBI Listing Regulations and are independent of the management and have also complied with the Code for Independent Directors as prescribed in Schedule IV of the Act. All the Independent Directors of the Company are also registered with the databank of Independent Directors as required under the provisions of the Act.

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees and reimbursement of expenses, if any.

The Directors and the senior management personnel have affirmed compliance with the Code of Conduct for Directors and Senior Management Personnel during the year under review.

G. Board and Committee Meetings

I. Board Meetings

The Board of Directors met 9 (Nine) times during the financial year under review. The details of the Board meetings and attendance of each Director thereat are provided in the Corporate Governance Report forming part of the Annual Report as Annexure - 2.

II. Committees of the Board

The Company has 5 (Five) Board-Level Committee(s), which have been established in compliance with the provisions of the Act and SEBI Listing Regulations:

i. Audit Committee

The Companyâs Audit Committee composition is in line with the requirements of Section 177 of the Companies Act, 2013 and Regulation 18 of the Listing Regulations.

The Members of the Audit Committee are financially literate and have requisite accounting and financial management expertise. The composition, terms of reference of the Audit Committee and the particulars of meetings held and attendance thereat are mentioned in the Corporate Governance Report forming part of the Annual Report. During the year under review, all the recommendations of the Audit Committee in terms of its reference were considered positively by the Board of Directors of your Company.

ii. Other Committees

The details of other Committees of the Board are given under the Report on Corporate Governance section forming part of this Annual Report and the list of Committees of the Board is also available on the website of the Company viz. www. parasdefence.com.

17. COMPLIANCE WITH SECRETARIAL STANDARDS

During the period from April 01, 2023 to March 31, 2024, the Company complied with the Secretarial Standard - 1 and Secretarial Standard - 2, issued by the Institute of Company Secretaries of India.

18. SUSTAINABILITY AND CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Companyâs Sustainability, Environment, Social and Governance Report is provided separately as part of the Annual Report.

The brief outline of the Companyâs CSR initiatives undertaken during the year under review is furnished in Annexure-3 in the format as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from time to time. The Companyâs CSR Policy is placed on the website of the Company https://www.parasdefence.com/investors .

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

19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

In line with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ), the Company has formulated a Policy on Related Party Transactions and the same can be accessed using the following link: https://www. parasdefence.com/investors.

During the year under review, all other contracts / arrangements / transactions entered by the Company with Related Parties were in the ordinary course of business and on an armâs length basis. A statement giving details of all Related Party Transactions, as approved, is placed before the Audit Committee for review on a quarterly basis. The details of the transactions entered into between the Company and the related parties under Sections 188 and 134(3)(h) of the Act, are given in AOC - 2 enclosed as Annexure - 4 to this report.

The Disclosures as required under Indian Accounting Standard - 24 (Ind AS-24) âRelated Party Disclosuresâ notified under Rule 7 of the Companies (Accounts) Rules, 2014 have been provided in notes forming part of the Standalone Financial Statements.

20. PARTICULARS OF REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL (KMP) AND EMPLOYEES AND DISCLOSURES IN BOARDâS REPORT

The information required under Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in this Report. In terms of first proviso to Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the members excluding the certain information covered under aforesaid Annexure. Any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company. None of

the employees listed in the said Annexure - 5 is related to any Director of the Company except to the extent specified in the Financial Statements.

The disclosure on remuneration of Directors, Key Managerial Personnel and Employees as required under the Companies Act, 2013 and Rules made thereunder is enclosed as Annexure - 5 to this Report.

21. MANAGEMENT DISCUSSION AND ANALYSIS

In terms of provisions of Regulation 34(2)(e) and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Management Discussion and Analysis Report is enclosed as Annexure - 6 to this Report.

22. BOARD EVALUATION

Pursuant to provisions of Section 134(3)(p) of the Companies Act, 2013 read with Rule 8(4) of the Companies (Accounts) Rules, 2014 and in terms of framework of Nomination and Remuneration Policy, the Nomination and Remuneration Committee and Board of Directors have carried out annual performance evaluation of the Directors.

23. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is enclosed as Annexure - 7 to this report.

24. AUDITORS

I. Statutory Auditors

Members of the Company at the AGM held on September 29, 2023, approved the reappointment of M/s. Chaturvedi & Shah LLP, Chartered Accountants (FRN: 101720W/ W100355) (âC&Sâ), as the Statutory Auditors of the Company for a period of five years commencing from the conclusion of the 14^th AGM held on September 29, 2023 until the conclusion of 19^th AGM of the Company to be held in the year 2028.

The Auditors have issued an unmodified opinion on the Financial Statements, both standalone and consolidated, for the financial year ended March 31, 2024. The said Auditorsâ Report(s) for the financial year ended March 31, 2024 on the financial statements of the Company forms part of this Annual Report.

II. Cost Auditors

The provisions of Section 148 of the Companies Act, 2013 for maintaining the Cost Records are applicable to the Company.

Accordingly, the Company is maintaining the Cost Records as specified by the Central Government

under the Rules made there under Section 148 of the Companies Act, 2013. Pursuant to the provisions of Section 148(3) of the Companies Act, 2013, the Board of Directors had appointed M/s. Dinesh Jain & Company, Cost Accountant, Mumbai (FRN: 100583), as Cost Auditors of the Company, for conducting the audit of cost records for the financial year ended March 31, 2024. A proposal for ratification of remuneration of the Cost Auditors is placed before the shareholders.

III. Secretarial Auditors

During the year under review, the Board of Directors had appointed M/s. DM & Associates, Company Secretaries LLP (FRN: L2017MH003500), Practicing Company Secretaries as the Secretarial Auditors to conduct secretarial audit of the Company for the financial year 2023-24. The secretarial audit report in Form MR-3 as issued by them is enclosed as Annexure - 8 to this Report. The comments provided by them are self-explanatory and hence does not require comments from the Board.

The Secretarial Audit was not applicable to any of the subsidiaries of the Company during the year under review.

IV. Internal Auditors

During the year under review, the Board of Directors had appointed M/s. Shaparia Mehta & Associates LLP, Independent Chartered Accountant Firm, as Internal Auditors for conducting the internal audit functions of the Company who have submitted their report thereon for the financial year 2023-24 to the Board and Committee for its review.

25. STATUTORY AUDITORSâ REPORT

The Auditorsâ Report on the Financial Statements (Standalone and Consolidated) of the Company for the year under review, âwith an unmodified opinionâ, as given by the Statutory Auditors, is disclosed in the Financial Statements forming part of this Annual Report. The Auditorsâ Report is unmodified and there are no qualifications or adverse remarks in their Report. Also, no frauds in terms of the provisions of Section 143(12) of the Companies Act, 2013 have been reported by the Statutory Auditors in their report for the year under review.

26. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS

There are no qualifications, reservations or adverse remarks made by the Auditors (Statutory Auditors and Secretarial Auditors) in their report. Hence, no comments are offered by the Board of Directors.

27. ANNUAL RETURN

In compliance with Section 92(3) of the Companies Act, 2013 (âthe Actâ) read with Section 134(3) of the Act, the Annual

Return of the Company as on March 31, 2024 will be available on the website of the Company at https://www.parasdefence. com/annual-returns/

28. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors, based on the representations received from the operating management and after due enquiry, confirm that:

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

b) they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year March 31, 2024 and of the profit of the Company for that period;

c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they had prepared the annual accounts on a going concern basis;

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

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

29. HUMAN RESOURCES / INDUSTRIAL RELATIONS, INCLUDING NUMBER OF PEOPLE EMPLOYED

Your Company provides regular training to employees to improve skills. Your Company has put in place a performance appraisal system that covers all employees. Your Company had 418 permanent employees as on March 31, 2024 while the count was 404 as on March 31, 2023.

30. CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements under the Companies Act, 2013, and as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ). A separate section on corporate governance under the SEBI Listing Regulations, along with the certificate from the Practicing Company Secretary confirming the compliance, is enclosed as Annexure - 2D of this report.

31. COMPANYâS POLICY RELATING TO DIRECTORSâ APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES

Your Company has adopted a policy relating to appointment of Directors, payment of managerial remuneration, Directorsâ qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013.

32. RISK MANAGEMENT POLICY

In line with regulatory requirements, the Company has framed risk management policy to identify and access with the regulatory risk areas and a risk mitigation process. A detailed exercise is being carried out at regular interval to identify, evaluate, manage and monitor all business risks. The Board periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework.

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

The Company is committed to provide a healthy environment to all the employees and thus does not tolerate any sexual harassment at workplace. The Company has in place, âPolicy on prevention, Prohibition and Redressal of Sexual Harassment.â The policy aims to provide protection to employees at the workplace and preventing and redressing complaints of sexual harassment and it covers matters connected or incidental thereto. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the year under review, the Company has not received any compliant of sexual harassment.

34. WHISTLE BLOWER POLICY / VIGIL MECHANISM

Pursuant to Section 177(9) read with Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has duly established Whistle Blower Policy /Vigil Mechanism Policy (âPolicyâ) to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct. The functioning of the Policy is reviewed by the Audit Committee / Board on periodical basis. During the financial year ended March 31, 2024, the Company has not received any complaint under the Whistle Blower Policy of the Company.

35. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the members of the Board of Directors and Senior Management Personnel. It is confirmed that all Directors and Senior Management Personnel have affirmed their adherence to the provisions of the Code of Conduct during the financial year 2023-24.

36. POLICIES AND DISCLOSURE REQUIREMENTS

In terms of provisions of the Companies Act, 2013 and provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted the policies, which are available on Companyâs website -https://www.parasdefence.com/investors.

37. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

The Company has provided Business Responsibility and Sustainability Report in line with the requirement based on SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ) and the âNational Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Businessâ notified by Ministry of Corporate Affairs (MCA). Pursuant to the provisions of Regulation 34 of the SEBI Listing Regulations, the said report is attached separately, which forms part of this Annual Report.

38. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

During the year, there were no significant material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status of the Company and its future operations.

39. DIFFERENCEBETWEENAMOUNTOFTHEVALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

During the year under review, there was no instance of onetime settlement with banks or financial institutions, hence the requirement to disclose the details of difference between the amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions, along with the reasons thereof, is not applicable.

40. IBC CODE & ONE-TIME SETTLEMENT

There is no proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 (IBC Code). There has not been any instance of one-time settlement of the Company with any bank or financial institution.

41. ACKNOWLEDGEMENTS

Your Board takes this opportunity to thank all its employees for their dedicated service and firm commitment to the goals of the Company. Your Board also wishes to place on record its sincere appreciation for the wholehearted support received from members, clients, bankers and all other business associates. We look forward to continued support of all these partners in progress.

Mar 31, 2023

BOARDâS REPORT

THE MEMBERS OF

PARAS DEFENCE AND SPACE TECHNOLOGIES LIMITED

The Directors of your Company are pleased to present fourteenth Annual Report on the business and operations of the Company along with the
Audited Financial Statements for the financial year ended on March 31, 2023.

1. FINANCIAL SUMMARY AND HIGHLIGHTS

Particulars	Standalone		Consolidated
	FY 2022-23	FY 2021-22	FY 2022-23	FY 2021-22
Revenue from Operations	21,427.96	18,000.01	22,242.59	18,256.24
Other Income	833.30	300.86	822.43	297.17
Total Income	22,261.26	18,300.87	23,065.02	18,553.41
Less: Total Expenditure	17,588.57	14,661.62	18,367.39	14,895.68
Less: Share of loss of associate	-	-	13.13	0.42
Profit Before Tax	4,672.69	3,639.25	4,684.50	3,657.31
Less: Income tax	1,173.48	1,008.01	1,185.41	1,009.46
Less: Deferred Tax	(28.87)	(59.62)	(30.21)	(59.88)
Less: Income Tax for earlier years	(64.74)	-	(64.74)	-
Profit after Tax	3,592.82	2,690.86	3,594.04	2,707.73
Other Comprehensive Income (net of taxes)	6.08	0.79	-	(0.33)
Total Comprehensive Income for the year	3,586.74	2,690.07	3,594.04	2,708.06

On standalone basis, the total income for the financial year
ended March 31, 2023 was '' 22,261.26 Lakhs, which is 21.64 %
more than the previous year''s income of '' 18,300.87 Lakhs. Our
total income on consolidated basis for the financial year ended
March 31, 2023 was '' 23,065.02 Lakhs as against '' 18,553.41
Lakhs for the financial year ended March 31, 2022.

On standalone basis, the net profit after tax (PAT) for the financial
year ended March 31, 2023 stood at '' 3,592.82 Lakhs as against
previous year''s net profit of '' 2,690.86 Lakhs thereby recording a
growth of 33.52%. Our net profit after tax (PAT) on consolidated basis
for the financial year ended March 31, 2023 amounted for ''3,594.04
Lakhs as compared to '' 2,707.73 Lakhs in the previous year.

2. TRANSFER TO RESERVES

The Company has not transferred any amount out of the current
year profits of the Company for the financial year 2022-23 to
General Reserve Account.

3. DIVIDEND AND TRANSFER TO IEPF

The Board of Directors has not recommended any dividend on
equity shares for the financial year 2022-23. The Company was
not required to transfer any unpaid / unclaimed amount of
dividend to IEPF during the financial year ended March 31, 2023.

The Company has in place a Dividend Distribution Policy in
accordance with Regulation 43A of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015 and the

same is available on the Company''s website at https://www.
parasdefence.com/policies/.

4. STATE OF THE COMPANYâS AFFAIRS

The information on Company''s affairs and related aspects
is provided under Management Discussion and Analysis
Report, which has been prepared, inter-alia, in compliance
with Regulation 34 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and forms part of this Report.

5. CHANGE IN THE NATURE OF BUSINESS

There were no changes in the nature of business during the
financial year ended March 31, 2023.

6. MATERIAL CHANGES AND COMMITMENT, IF ANY
AFFECTING FINANCIAL POSITION OF THE COMPANY

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

7. PARTICULARS OF LOANS, GUARANTEES AND
INVESTMENTS

Particulars of loans given, investments made, guarantees given
and securities provided during the year and as covered under
Section 186 of the Companies Act, 2013 form part of the notes to
the standalone financial statements of the Company provided in
this annual report.

8. DEPOSITS

The Company has not accepted or renewed any amount falling
within the purview of provisions of Section 73 of the Companies
Act 2013 (âthe Actâ) read with the Companies (Acceptance of
Deposit) Rules, 2014 during the year under review. Hence, the
requirement for furnishing of details relating to deposits covered
under Chapter V of the Act or the details of deposits which are not
in compliance with Chapter V of the Act is not applicable.

9. DETAILS OF SUBSIDIARY, ASSOCIATE AND JOINT
VENTURE COMPANIES

A. SUBSIDIARIES

As on March 31, 2023, the Company has 5 (five) subsidiaries out
of which 4 (four) are Indian subsidiaries and 1 (one) Foreign
subsidiary.

The details of the Subsidiaries are as follows:

Name of the Company	Type of Subsidiary	Date of Incorporation
Paras Green Optics Private Limited	Indian Wholly Owned Subsidiary	29/10/2018
Paras Aerospace Private Limited	Indian Subsidiary	13/02/2019
Paras Anti-Drone Technologies Private Limited	Indian Subsidiary	25/02/2019
Ayatti Innovative Private Limited	Indian Subsidiary	13/08/2018
Opel Technologies Pte. Ltd.	*Foreign Wholly Owned Subsidiary	02/01/2019

B. ASSOCIATE COMPANIES

As on March 31, 2023, there is 1 (One) Associate company within
the meaning of Section 2(6) of the Companies Act, 2013.

The details of the Associate Company are as follows:

Name of the Company	Date of Incorporation
Krasny Paras Defence Technologies Private Limited	10/11/2021

C. JOINT VENTURE

As on March 31, 2023, there are no Joint Ventures within the
meaning of Section 2(6) of the Companies Act, 2013.

10. PERFORMANCE AND FINANCIAL HIGHLIGHTS
OF SUBSIDIARY COMPANIES AND THEIR
CONTRIBUTION TO OVERALL PERFORMANCE OF
THE COMPANY

The consolidated financial statements of the company, forms
a part of this Annual Report. A Statement containing salient
features of the financial statement of subsidiaries pursuant to
first proviso to sub section (3) of section 129 read with rule 5 of
Companies (Accounts) Rules, 2014 in the prescribed Form AOC-1
are enclosed as Annexure - 1 to this report.

11. SHARE CAPITAL

A. Authorized share capital

Date of Approval from	Particulars	Revised Authorized Share Capital
Shareholders		From	To
September 27,	Re-	'' 60,50,00,000	'' 60,50,00,000
2022	classification	divided into	divided into
	of the	5,09,20,000 Equity	6,05,00,000
	authorized	Shares of '' 10	Equity Shares
	share capital	each and 9,58,000 Preference Shares of '' 100 each	of '' 10 each

B. Issued, Subscribed and Paid-up Share Capital

During the period under review, no allotment of securities have
been made by the Company.

12. BONUS SHARES/ EQUITY SHARES WITH
DIFFERENTIAL VOTING RIGHTS/ESOP/SWEAT
EQUITY

During the year under review, the Company has not issued any
equity shares with differential voting rights nor has granted any
stock options or sweat equity.

As on March 31, 2023, none of the Directors of the Company hold
instruments convertible into equity shares of the Company.

13. ISSUE OF DEBENTURES, BONDS AND ANY OTHER
NON-COVERTIBLE SECURITIES/WARRANTS

During the year under review, the Company has not issued any
debentures, bonds and any other non-convertible securities nor
Company has issued any warrants.

14. CREDIT RATING

During the year under review, your Company has been rated by CRISIL Ratings Limited (âCRISILâ) vide its letter dated May 30, 2022 and by ICRA
Limited (âICRAâ) vide its letter dated January 23, 2023 for its bank facilities as follows:

CRISIL Ratings Limited
Instrument Type	Size of Issue ('' in Cr.)	Rating Outlook	Rating action
Bank Guarantee	23.00	CRISIL A2	Reaffirmed
Cash Credit	39.00	CRISIL BBB / Positive	Outlook revised to Positive from Negative
Letter of Credit	5.00	CRISIL A2	Reaffirmed
Pre-Shipment Credit	7.00	CRISIL A2	Reaffirmed
Long Term Loan	10.00	CRISIL BBB / Positive	Outlook revised to Positive from Negative
Proposed Term Loan	19.00	CRISIL BBB / Positive	Outlook revised to Positive from Negative

ICRA Limited
Instrument Type	Size of Issue ('' in Cr.)	Rating Outlook	Rating action
Long Term Cash Credit	39.00	[ICRA]A- (Stable)	Reaffirmed
Long Term/Short Term - Bank Guarantee & LC	71.00	[ICRA]A (Stable)/[ICRA]A	\2 Reaffirmed

15. INTERNAL FINANCIAL CONTROL AND THEIR
ADEQUACY

The Company has in place adequate internal financial controls
with reference to the financial statements. The Board reviews
the internal control systems at regular intervals internally, the
adequacy of internal audit function and significant internal audit
findings with the management and update the same to the Audit
Committee for their review and recommendation to the Board.

16. DETAILS OF DIRECTORS AND KEY MANAGERIAL
PERSONNEL

Composition of Board of Directors

The composition of Board of Directors of the Company as on
March 31, 2023 is as follows:

Name of Director	DIN	Category
Sharad Virji Shah	00622001	Promoter, Chairman & Non-Executive NonÂ¬ Independent Director
Munjal Sharad Shah	01080863	Promoter, Managing Director
Shilpa Amit Mahajan	01087912	Whole-Time Director
Manmohan Handa	06942720	Non-Executive Independent Director
Hina Amol Gokhale	08712659	Non-Executive Independent Director
Suresh Katyal	08979402	Non-Executive Independent Director

Re-appointment

Pursuant to the provisions of Regulation 17(1)A of SEBI (Listing
Obligation and Disclosure Requirements), Regulations 2015, Mr.
Sharad Virji Shah (DIN:00622001), Chairman and Non- Executive
Director of the Company, who attained the age of 75 years on
December 18, 2022 was reappointed by the Board of Directors of
the Company at their meeting held on September 02, 2022 and
by the shareholders of the Company on September 27, 2022 to
continue and to hold his office of Chairman and Non-Executive
Director of the Company, even after attaining the age of 75 years.

In accordance with the provisions of Section 152 of the Companies
Act, 2013 and the Company''s Articles of Association, Mrs. Shilpa
Amit Mahajan (DIN: 01087912), Whole-Time Director, retires by
rotation at the forthcoming fourteenth Annual General Meeting
and being eligible has offered herself for re-appointment.

Resignation

Pursuant to the provisions of Section 168 of the Companies Act,
2013 read with applicable regulations of SEBI (Listing Obligation
and Disclosure Requirements), Regulations 2015, Mr. Sunil Kumar

Sharma (DIN: 03614952) has resigned from the position of NonÂ¬
Executive Independent-Director of the Company w.e.f. December
10, 2022.

Apart from the above, there was no other change in the
composition of the Board of Directors during the period under
review.

KEY MANAGERIAL PERSONNEL (KMP)

Name of Key Managerial Personnel	Category
Munjal Sharad Shah	Managing Director
Shilpa Amit Mahajan	Whole-Time Director
Harsh Dhirendra Bhansali	Chief Financial Officer
*Hemalkumar Hiranbhai Sagalia	Company Secretary &
	Compliance Officer

DECLARATIONS GIVEN BY INDEPENDENT DIRECTORS

The Company has received necessary declarations and
disclosures from the Independent Directors under Section 149(7)
and Section 184(1) of the Companies Act, 2013 stating that they
meet the criteria of independence as laid down in Section 149(6)
of the Companies Act, 2013 and under the applicable provisions
of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and disclosing their interest in form MBP-1. All
the Directors have certified that the disqualifications mentioned
under sections 164, 167 and 169 of the Companies Act, 2013 do
not apply to them. The Independent Directors have complied
with the Code for Independent Directors prescribed in Schedule
IV to the Act.

of Independent Directors as required under the provisions of the
Companies Act, 2013.

During the year under review, the Non-Executive Directors of the
Company had no pecuniary relationship or transactions with
the Company, other than sitting fees and reimbursement of
expenses, if any.

The Directors and the senior management personnel have
affirmed compliance with the Code of Conduct for Directors and
Senior Management Personnel during the year under review.

BOARD AND COMMITTEE MEETINGS

Board Meetings

The Board of Directors met Nine (9) times during the financial year
under review. The details of the Board meetings and attendance of
each Director thereat are provided in the Corporate Governance Report
forming part of the Annual Report as Annexure - 2.

Committees of the Board

The Company has Five (5) Board-level Committee(s), which have been
established in compliance with the provisions of the Act and SEBI
Listing Regulations:

I. AUDIT COMMITTEE

The Company''s Audit Committee composition is in line with the
requirements of Section 177 of the Companies Act, 2013 and
Regulation 18 of the Listing Regulations.

The Members of the Audit Committee are financially literate and
have requisite accounting and financial management expertise.
The composition, terms of reference of the Audit Committee
and the particulars of meetings held and attendance thereat
are mentioned in the Corporate Governance Report forming
part of the Annual Report. During the year under review, all the
recommendations of the Audit Committee in terms of its Charter
were considered positively by the Board of Directors of your
Company.

II. OTHER COMMITTEES

The details of other Committees of the Board are given under the
Report on Corporate Governance section forming part of this Annual
Report and the list of committees of the Board is also available on
the website of the Company viz. www.parasdefence.com

17. COMPLIANCE WITH SECRETARIAL STANDARD

During the period from April 01, 2022 to March 31, 2023, the
Company complied with the Secretarial Standard - 1 and
Secretarial Standard - 2, issued by the Institute of Company
Secretaries of India.

18. SUSTAINABILITY AND CORPORATE SOCIAL
RESPONSIBILITY (CSR)

Company''s Sustainability, Environment, Social and Governance
Reporting is provided separately as part of the Annual Report.

The brief outline of the Company''s CSR initiatives undertaken
during the year under review is furnished in Annexure-3 in

the format as prescribed in the Companies (Corporate Social
Responsibility Policy) Rules, 2014, as amended from time to
time. The Company''s CSR Policy is placed on the website of the
Company https://www.parasdefence.com/policies/

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

19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS
WITH RELATED PARTIES

All the related party transactions are placed before the Audit
Committee for their review and approval. Prior Omnibus approval
is obtained before the commencement of the new financial year,
for the transactions which are repetitive in nature and also for the
transactions which are not foreseen (subject to financial limit).
A statement of all related party transactions is presented before
the Audit Committee on a quarterly basis specifying the nature,
value and terms & conditions of the transactions. All transactions
entered with related parties were in compliance with the
applicable provisions of the Companies Act, 2013 read with the
relevant rules made thereunder and the Listing Regulations

All the transactions with related parties are in the ordinary
course of business and on arm''s length basis. The details of the
transactions entered into between the Company and the related
parties under Section 188 of the Companies Act, 2013 are given in
AOC - 2 is enclosed as Annexure - 4 to this report.

The Disclosures as required under Indian Accounting Standard -
24 (Ind AS-24) âRelated Party Disclosuresâ notified under Rule 7
of the Companies (Accounts) Rules, 2014 have been provided in
Notes forming part of the Standalone Financial Statements.

20. PARTICULARS OF REMUNERATION OF DIRECTORS,
KEY MANAGERIAL PERSONNEL (KMP) AND
EMPLOYEES AND DISCLOSURES IN BOARDâS
REPORT

The information required under Rule 5(2) of The Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, is provided in this Report. In terms of first proviso
to Section 136 of the Act, the Report and Accounts are being
sent to the members excluding the certain information covered
under aforesaid Annexure. Any member interested in obtaining
the same may write to the Company Secretary at the Registered
Office of the Company. None of the employees listed in the said
Annexure - 5 is related to any Director of the Company.

The disclosure on remuneration of Directors, Key Managerial
Personnel and employees as required under the Companies Act,
2013 and Rules made thereunder is enclosed as Annexure - 5 to
this Report.

21. MANAGEMENT DISCUSSION AND ANALYSIS

In terms of provisions of Regulation 34(2)(e) and schedule V of SEBI
(Listing Obligations and Disclosure Requirements) Regulations,
2015, (Listing Regulations) a Management Discussion & Analysis
Report is enclosed as Annexure - 6 to this Report.

22. BOARD EVALUATION

Pursuant to provisions of section 134(3)(p) of the Act read with
Rule 8(4) of the Companies (Accounts) Rules, 2014 and in terms
of framework of Nomination and Remuneration Policy, the
Nomination and Remuneration Committee and Board of Directors
have carried out annual performance evaluation of the Directors.

23. CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE EARNINGS
AND OUTGO

The information on conservation of energy, technology
absorption and foreign exchange earnings and outgo stipulated
under Section 134(3)(m) of the Companies Act, 2013 read with
Rule 8 of the Companies (Accounts) Rules, 2014 is enclosed as
Annexure - 7 to this report.

24. AUDITORS

I. Statutory Auditors

Members of the Company at the AGM held on September
28, 2018, approved the appointment of M/s. Chaturvedi
& Shah LLP, Chartered Accountants (FRN: 101720W/
W1003555) (âC&S''), as the statutory auditors of the
Company for a period of five years commencing from the
conclusion of the 9^th AGM held on September 28, 2019 until
the conclusion of 14^th AGM of the Company to be held in the
year 2023.

In terms of the provisions of the Companies Act, 2013, an
audit firm acting as the statutory auditor of a company is
eligible to be appointed as statutory auditors for two terms
of five years each. The first term of C&S as statutory auditors
of the Company expires at the conclusion of the 14^th AGM
of the Company scheduled to be held on September 29,
2023. Considering their performance as auditors of the
Company during their present tenure, the Audit Committee
of the Company, after due deliberation and discussion,
recommended the re-appointment of C&S as statutory
auditors of the Company for a second term of five years
to hold office from the conclusion of the 14^th AGM to be
held on September 29, 2023 till the conclusion of the 19^thAGM of the Company to be held in the year 2028. Further
the remuneration for the tenure of their second term as
Statutory Auditors shall be mutually agreed between the
Board of Directors and C&S, from time to time.

The above proposal forms part of the Notice of the AGM for
your approval. The report of the Statutory Auditor forms
part of this Annual Report 2022-23.

The said report does not contain any qualification,
reservation, adverse remark or disclaimer. During the year
under review, the Auditors did not report any matter under
Section 143(12) of the Act, therefore no detail is required to
be disclosed under Section 134(3)(ca) of the Act.

II. Cost Auditor

The provisions of section 148 of the Companies Act, 2013
for maintaining the Cost Records are applicable to the
Company.

Accordingly, the Company is maintaining the Cost Records
as specified by the Central Government under the Rules
made there under section 148 of the Companies Act, 2013.
Pursuant to the provisions of section 148(3) of the Companies
Act, 2013, the Board of Directors had appointed M/s. Dinesh
Jain & Company, Cost Accountant, Mumbai (FRN: 100583),
as Cost Auditors of the Company, for conducting the audit
of cost records for the financial year ended March 31, 2023. A
proposal for ratification of remuneration of the Cost Auditors
is placed before the shareholders.

III. Secretarial Auditors

During the year under review, the Board of Directors had
appointed M/s. DM & Associates, Company Secretaries LLP
(RN: L2017MH003500), Practicing Company Secretaries in
place of M/s. Sawant & Associates, Practicing Company
Secretary, as the secretarial auditors to conduct secretarial
audit of the Company for the financial year 2022-23. The
secretarial audit report in form MR-3 as issued by them is
enclosed as Annexure - 8 to this Report. The comments
provided by them are self-explanatory and hence does not
require comments from the Board.

The Secretarial Audit was not applicable to any of the
subsidiaries of the Company during the year under review.

IV. Internal Auditor

M/s. Shaparia Mehta & Associates LLP, Independent Chartered
Accountant Firm, has been re-appointed as its Internal
Auditor for conducting the internal audit functions of the
Company and submitted their report thereon for the financial
year 2022-23 to the Board and committee for its review.

25. STATUTORY AUDITORSâ REPORT

The Auditors'' Report on the Financial Statements (Standalone
and Consolidated) of the Company for the year under review,
âwith an unmodified opinionâ, as given by the Statutory Auditors,
is disclosed in the Financial Statements forming part of this
Annual Report. The Auditors'' Report is unmodified and there
are no qualifications or adverse remarks in their Report. Also,
no frauds in terms of the provisions of Section 143(12) of the Act
have been reported by the Statutory Auditors in their report for
the year under review.

26. EXPLANATION OR COMMENTS ON QUALIFICATIONS,
RESERVATIONS OR ADVERSE REMARKS OR
DISCLAIMERS MADE BY THE AUDITORS AND THE
PRACTICING COMPANY SECRETARY IN THEIR
REPORTS

There are no qualifications, reservations or adverse remarks
made by the Auditors (Statutory Auditors and Secretarial
Auditors) in their report. Hence, no comments are offered by the
Board of Directors.

27. ANNUAL RETURN

In compliance with Section 92(3) of the Companies Act, 2013
read with section 134(3) of the Companies Act, 2013 the Annual
Return of the Company as on March 31, 2023 will be available on
the website of the Company at https://www.parasdefence.com/
annual-returns/.

28. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the
Directors, based on the representations received from the
operating management and after due enquiry, confirm that:

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

b) they had selected such accounting policies and applied
them consistently and made judgments and estimates
that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company at the end
of the financial year March 31, 2023 and of the profit of the
Company for that period;

c) they had taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies Act,
2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

d) they had prepared the annual accounts on a going concern
basis;

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

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

29. HUMAN RESOURCES / INDUSTRIAL RELATIONS,
INCLUDING NUMBER OF PEOPLE EMPLOYED

Your Company provides regular training to employees to improve
skills. Your company has put in place a performance appraisal
system that covers all employees. Your Company had 404
permanent employees as on March 31, 2023 while the count was
182 as on March 31, 2022.

30. CORPORATE GOVERNANCE

The Company has complied with the corporate governance
requirements under the Act, and as stipulated under the SEBI
Listing Regulations. A separate section on corporate governance
under the SEBI Listing Regulations, along with the certificate from
the Practicing Company Secretary confirming the compliance, is
enclosed as Annexure - 2D of this report.

31. COMPANYâS POLICY RELATING TO DIRECTORSâ
APPOINTMENT, PAYMENT OF REMUNERATION AND
DISCHARGE OF THEIR DUTIES

Your Company has adopted a policy relating to appointment
of Directors, payment of managerial remuneration, Directors''
qualifications, positive attributes, independence of Directors
and other related matters as provided under section 178(3) of
the Companies Act, 2013.

32. RISK MANAGEMENT POLICY

In line with regulatory requirements, the Company has framed
risk management policy to identify and access with the regulatory
risk areas and a risk mitigation process. A detailed exercise is
being carried out at regular interval to identify, evaluate, manage
and monitor all business risks. The Board periodically reviews
the risks and suggests steps to be taken to control and mitigate
the same through a properly defined framework.

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

The Company is committed to provide a healthy environment
to all the employees and thus does not tolerate any sexual
harassment at workplace. The Company has in place, âPolicy on
prevention, Prohibition and Redressal of Sexual Harassment.â
The policy aims to provide protection to employees at the
workplace and preventing and redressing complaints of sexual
harassment and it covers matters connected or incidental
thereto. The Company has complied with the provisions relating
to the constitution of Internal Complaints Committee under
the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.

During the year under review the Company has not received any
compliant of sexual harassment.

34. WHISTLE BLOWER POLICY / VIGIL MECHANISM

Pursuant to Section 177(9) read with Regulation 22 of the SEBI
Listing Regulations, your Company has duly established Whistle
Blower Policy /Vigil Mechanism Policy (âPolicyâ) to report to
the management instances of unethical behavior, actual or
suspected, fraud or violation of the Company''s code of conduct.
functioning of the Policy is reviewed by the Audit Committee /
Board on periodical basis. During the financial year ended March
31, 2023, the Company has not received any complaint under the
Whistle Blower Policy of the Company.

35. CODE OF CONDUCT

The Board of Director has approved a Code of Conduct which is
applicable to the members of the Board of Directors and Senior
Management Personnel. It is confirmed that all Directors and
Senior Management Personnel have affirmed their adherence
to the provisions of the Code of Conduct during the financial
year 2022-23.

36. POLICIES AND DISCLOSURE REQUIREMENTS

In terms of provisions of the Companies Act, 2013 and provisions
of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Company has adopted the following
Policies. The policies are available on Company''s website -
https://www.parasdefence.com/policies/.

37. BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT (BRSR)

The Company has provided BRSR in lieu of Business Responsibility
Report and the same is in line with the SEBI requirement based
on the âNational Voluntary Guidelines on Social, Environmental
and Economic Responsibilities of Business'' notified by Ministry of
Corporate Affairs (MCA). Pursuant to the provisions of Regulation
34 of the Listing Regulations, the said report is attached
separately, which forms part of this Annual Report.

38. SIGNIFICANT AND MATERIAL ORDERS PASSED BY
THE REGULATORS OR COURTS OR TRIBUNAL

During the year there were no significant material orders passed
by the Regulators / Courts / Tribunals which would impact the
going concern status of the Company and its future operations.

39. ACKNOWLEDGEMENTS

Your Board takes this opportunity to thank all its employees
for their dedicated service and firm commitment to the goals
of the Company. Your Board also wishes to place on record its
sincere appreciation for the wholehearted support received from
members, clients, bankers and all other business associates.
We look forward to continued support of all these partners in
progress.

For and on behalf of the Board of Directors
Paras Defence and Space Technologies Limited

Sharad Virji Shah Munjal Sharad Shah

Chairman & Non- Executive Director Managing Director

DIN:00622001 DIN:01080863

Date: September 04, 2023
Place: Navi Mumbai

Registered Office Address:

D-112, TTC Industrial Area, MIDC, Nerul, Navi Mumbai - 400706

Tel. No. 91-22-6919 9999

Fax No. 91-22-6919 9990

E-mail: [email protected]

Website: www.parasdefence.com

CIN:L29253MH2009PLC193352

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