Directors Report of Kirloskar Electric Company Ltd.

Mar 31, 2025

The directors are pleased to present the 78^th Annual Report of Kirloskar Electric Company Limited (hereinafter referred as “the
Company” or “KECL”) along with the audited financial statements for the financial year ended March 31,2025. The consolidated
performances of the Company and its subsidiaries have been referred to wherever required.

Review of performance and state of Company''s affairs:

During the year under report, your Company achieved a total turnover of ?54,382/- Lakhs (previous year ? 55,735/- Lakhs). The
operations have resulted in profit of ?4,592/- Lakhs (previous year loss was ? 839/- Lakhs) i.e., total comprehensive income for the
period.

The financial summary and highlights are as follows: (^ i_n |__akh_s)

PARTICULARS	Standalone		Consolidated
	2024-25	2023-24	2024-25	2023-24
Revenue from operations	54,382	55,735	54,382	55,735
Other income (Net)	693	793	775	799
Total Revenue	55,075	56,528	55,157	56,534
Total Expense	54,327	55,011	55,753	55,126
Profit before Exceptional items	748	1,517	(596)	1,408
Exceptional Items	995	-	995	-
Profit / (Loss) before tax	1,743	1,517	399	1,408
Tax Expense	18	-	25	-
Profit / (Loss) after tax	1,725	1,514	374	1,408
Total other comprehensive income	2,867	(2,356)	2,867	(2,356)
Total comprehensive income for the period	4,592	(839)	3,241	(948)

Note: The above figures are extracted from the audited standalone and consolidated financial statements as per Indian Accounting
Standards (Ind AS).

Dividend:

In view of the accumulated losses, the Board of directors of your Company has not recommended any dividend for the year under
review.

Transfer to reserves:

In view of the accumulated losses, the Board of directors of your Company has not transferred any amount to the reserves for the
year under review.

Change in the nature of business:

There was no change in nature of the business of the Company during the financial year ended on March 31,2025.

Share Capital:

As on March 31,2025, the paid up share capital of your Company stood at ? 66,41,40,710/- divided into 6,64,14,071 equity shares of
? 10/- each.

Disclosure under section 43(a)(ii) of the Companies Act, 2013:

The Company has not issued any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the
Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 54(1)(d) of the Companies Act, 2013:

The Company has not issued any sweat equity shares during the financial year under review and hence no information as per
provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 has been
furnished.

Disclosure under section 55(2) & 77 of the Companies Act, 2013:

The Company has not redeemed any shares / debentures during the financial year under review and hence no information as per
provisions of Section 55(2) & 77 of the Act read with the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.
Disclosure under section 62(1)(b) of the Companies Act, 2013:

The Company has not issued any equity shares under Employees Stock Option Scheme (''ESOS'') during the financial year under
review and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share
Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 67(3) of the Companies Act, 2013:

During the financial year under review, there were no instances of non-exercising of voting rights in respect of shares purchased

directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and
Debentures) Rules, 2014 and hence no information has been furnished.

Transfer to Investor Education and Protection Fund:

The Company has transfered f 10.30 lakhs to the Investors Education and Protection Fund (IEPF), pertaining to matured deposit
along with interest amount therein.

The details of Nodal Officer of the Company, in line with the provisions of IEPF Regulations are available on the website of the
Company at https://kirloskarelectric.com/investors/investors-information/investor-contacts.html.

Fiviarl rliannQitQ-

Sl.No.	Particulars	(fin Lakhs)
1.	Accepted / renewed during the year	Nil
2.	Remained unpaid or unclaimed at the end of the year.	Nil
3.	Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:- • At the beginning of the year • Maximum during the year • At the end of the year	N/A
4.	Details of deposits which are not in compliance with the requirements of Chapter V of the Act;	Nil

Note: During the year under review, the Company has transferred the matured & unclaimed deposit of f10,00,000.1- (Rupees Ten
Lakhs only) along with the interest amount f29,795/- (Rupees Twenty Nine Thousand Seven Hundred and Ninety Five Only) to IEPF,
as the Company did not receive claim from the deposit holders. The Company took all efforts to contact the FD Holders by sending
them reminders. There are no other unpaid or unclaimed Fixed Deposits with the Company.

Credit Ratings:

Information regarding credit ratings obtained by the Company for the year under review has been given under the Corporate
Governance Report which forms part of this Annual Report.

Subsidiaries, associate companies & joint ventures:

The Company has four wholly owned subsidiaries, one step-down subsidiary, one associate Company and one Joint Venture.

The consolidated financial statements of the Company and its subsidiaries are prepared in accordance with the applicable
accounting standards, issued by the Institute of Chartered Accountants of India and forms part of this Annual Report.

Neither the Executive Chairman and nor the Whole-time directors of the Company receive any remuneration or commission from
any of its subsidiaries or associate Company.

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the reports on
the performance and financial position of each of the subsidiary and associate companies have been provided in Form AOC-1
appended to this report.

Company has filed an application for the merger by absorption of four wholly-owned subsidiary companies - KELBUZZ Trading
Private Limited (KTPL), Luxquisite Parkland Private Limited (LPPL), SLPKG Estate Holdings Private Limited (SEHPL) and SKG
Terra Promenade Private Limited (STPPL) - with the holding company, Kirloskar Electric Company Limited (KECL), before the
National Company Law Tribunal (NCLT), Bengaluru Bench, on October 31,2024. The appointed date for this amalgamation is April
1,2024. The Company is yet to receive the final merger order in this regard. Necessary information regarding this has been intimated
to the Stock Exchanges and is also available on the website of the Company.

Directors and Key Managerial Personnel:

Your Company has a well-diversified Board comprising of directors having skills, competencies and expertise in various areas to
ensure effective corporate governance of the Company.

As on March 31,2025, the Board comprised of 11 (Eleven) directors, out of which 6 (six) were Non-Executive Independent Directors,
02 (Two) Non Executive Non Independent Women Directors and 03 (three) Executive Directors. The Company is in compliance with
the regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) regulations, 2015 (“SEBI Listing Regulations”).

In accordance with the provisions of section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mr. Vijay
Ravindra Kirloskar (DIN: 00031253), a Non-Executive Director being longest in the office, shall retire by rotation and being eligible,
has offered himself for re-appointment. The resolution seeking members'' approval for his re-appointment forms part of the AGM
Notice.

During the year under review, the Independent Directors, namely Mr. Kamlesh Gandhi (DIN: 00004969), Mr. Satyanarayan Agarwal
(DIN: 00111187) & Mr. Anil Kumar Bhandari (DIN: 00031194) have completed their second term, comprising five consecutive years,

and have retired from their directorships effective from the close of business hours on September 20, 2024.

Ms. Rukmini Kirloskar (DIN: 00309266) was appointed as Director liable to retire by the rotation with effect from May 23, 2024 by the
members of the Company by way of postal ballot on August 22, 2024 as required under the Regulation 17 (1C) of SEBI Listing
Regulations.

Mr. K N Shanth Kumar (DIN: 00487956) was appointed as an Independent Director of the Company for a term of five (05)
consecutive years, with effect from May 23, 2024 by the members of the Company by way of postal ballot on August 22, 2024 as
required under the Regulation 17 (1C) of SEBI Listing Regulations.

Mr. Mohammed Saad Bin Jung (DIN: 00264525) was appointed as an Independent Director of the Company for a term of five (05)
consecutive years with effect from August 6, 2024 by the members of the Company at the 77^th Annual General Meeting held on
September 16, 2024, as required under the Regulation 17 (1C) of SEBI Listing Regulations.

Dr. Pangal Ranganath Nayak (DIN: 01507096) was appointed as an Independent Director of the Company for a term of five (05)
consecutive years, with effect from August 6, 2024 by the members of the Company at the 77^th Annual General Meeting held on
September 16, 2024, as required under the Regulation 17 (1C) of SEBI Listing Regulations.

Mr. Sanjeev Kumar Shivappa (DIN: 08673340) was reappointed as the Whole-time director in the capacity of Director (Finance) &
Chief Financial Officer of the Company for a term of one (01) year with effect from February 14, 2025. The members of the Company
has approved the reappointment of Mr. Sanjeev Kumar Shivappa by way of Postal Ballot on April 24, 2025.

Mr. Anand B Hunnur (DIN: 06650798) was re-appointed as the Managing Director of the Company for a period of three (03) years
with effect from July 12, 2025. The Board recommends his re-appointment at the ensuing Annual General Meeting of the Company.

During the year under review, the Non-Executive Directors (NEDs) of the Company had no pecuniary relationship or transactions
with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them, if applicable, for the
purpose of attending Board/ Committee meetings of the Company.

The Key Managerial Personnel (KMP) of the Company as on March 31, 2025 were Mr. Vijay R Kirloskar, Executive Director,
Mr. Anand B Hunnur, Managing Director, Mr. Sanjeev Kumar Shivappa, Director (Finance) & Chief Financial Officer and
Mr. Mahabaleshwar Bhat, General Manager - Corporate Affairs & Company Secretary.

Declaration by Independent Directors

In terms of the provisions of Section 149(7) of the Companies Act, 2013, the Company has received declarations from all the
Independent Directors stating that they continue to meet the criteria of independence as provided under the provisions of Section
149(6) of the Companies Act, 2013 read with the Rules made there under and the SEBI Listing Regulations.

In terms of regulation 25(8) of the SEBI Listing Regulations, Independent Directors have confirmed that they are not aware of any
circumstances or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their
duties. Based on the declarations received from the Independent Directors, the Board has confirmed that Independent Directors
meet the criteria of independence as mentioned under regulation 16(1)(b) of SEBI Listing Regulations and that they are independent
of the management.

All Independent Directors have affirmed compliance to the code of conduct for Independent Directors as prescribed in Schedule IV of
the Companies Act, 2013 and the Code of Conduct for Directors and senior management personnel formulated by the Company.

All Independent Directors have registered their names in the Independent Director''s Databank. In the opinion of the Board, the
Independent Directors so appointed / re-appointed possess the requisite expertise, experience and proficiency and are of integrity.
Evaluation of Directors, Committees and the Board:

The evaluation process has been explained in the Corporate Governance Report which forms part of the annual report.

Number of meetings of the Board of Directors and its Committees:

The Board of directors met 06 (Six) times during the financial year 2024-25 under review through Video Conference mode / other
audio visual means mode.

The maximum interval between any two meetings was within the maximum allowed gap pursuant to the Companies Act, 2013 and
SEBI Listing Regulations read with the Circulars issued by MCA and SEBI

The Board meetings were held on May 23, 2024, August 06, 2024, September 16, 2024, November 05, 2024, February 12, 2025 and
March 25, 2025.

The composition and the details of the meetings of the Board and its Committee held during the year are contained in the Corporate
Governance Report which forms part of the annual report.

Nomination and Remuneration Policy:

The Nomination and Remuneration Committee is responsible for recommending to the Board, a policy relating to the appointment

and remuneration of the Directors, Key Managerial Personnel and other employees. The Nomination and Remuneration Policy is
available on the website of the Company at https://kirloskarelectric.com/investors/investors-information/policies.html.

Features of Nomination and Remuneration Policy:

• The policy has been framed in line with the Company''s philosophy to ensure equitable remuneration to all the directors, key
managerial personnel (KM P) and employees of the Company.

• The policy lays down the criteria, terms and conditions including qualifications and positive attributes for identifying persons
who are qualified to become directors (executive and non-executive / Independent) and persons who may be appointed in
senior management and key managerial positions of the company.

• The policy determines the remuneration of Directors, Key Managerial Personnel and other employees based on the Company''s
size and financial position and trends and practices on remuneration prevailing in peer companies.

• This Policy is divided in three parts:

Part - A: covers matters to be dealt by the committee.

Part - B: covers appointments and nominations.

Part - C: covers remuneration and perquisites etc.

Risk Management Policy:

Your Company has devised and implemented a comprehensive ''Risk Management Policy'' which provides for identification,
assessment and control of risks that the company would face in the normal course of business and mitigation measures associated
with them. The Management identifies and controls risks through a properly defined framework in terms of the aforesaid policy. The
Risk management policy has been appended to this report as Annexure-I.

Conservation of energy, technology absorption, Research & development and foreign exchange earnings and outgo:

The relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure - II, which
forms part of this report.

Management Discussion and Analysis:

The Management Discussion and Analysis Report (“MDAR”) for the year under review, as prescribed under Part B of Schedule V
read with Regulation 34 of the SEBI Listing Regulations is appended hereto as Annexure - III and forms part of this report.
Managerial remuneration:

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is disclosed in the Annexure - IV.

Particulars of employees:

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with rules 5(2) & 5(3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing disclosures pertaining to
remuneration and also the names and other particulars of the employees drawing remuneration in excess of limits set out in the said
rules are provided in a separate Annexure to the Board''s Report which forms part of the annual report. The report and the accounts
are being sent to the Members excluding the aforesaid annexure and in terms of Section 136 of the Companies Act 2013, the said
annexure is open for inspection. Any Member interested in obtaining a copy of the same may write to the Company Secretary at
[e-mail]

Annual Return:

According to the provisions of Section 134(3)(a), a copy of annual return i.e., Form MGT-7 for the year ended March 31,2024 has
been placed on the Company''s website: https://kirloskarelectric.com/investors/investors-information/financial.html.

Director''s Responsibility Statement:

We, the Directors of your Company, confirm, to the best of our knowledge and ability that:-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material
departures;

(b) we have selected such accounting policies and applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and
of the profit / loss of the Company for that period;

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

(d) we have prepared the annual accounts on a going concern basis;

(e) we have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate
and operating effectively.

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

Particulars of loans, guarantee, investments and securities:

There were no loans and advances, guarantees, investments made or security given to any Body Corporate by the Company during
the financial year 2024-25.

Particulars of loans, advances, investments as required under the listing regulations:

The details of related party disclosures with respect to loans, advances, investment at the year end and maximum outstanding
amount thereof during the year as required (under part A of Schedule V of the Listing Regulations) have been provided in the notes to
the financial statement of Company.

Your directors draw attention of the members to note no. 17 & 36(9) of the standalone financial statements which sets out the details
of loan and advance, guarantee or investment.

Particulars of contracts or arrangements with related parties:

All contracts/ arrangements/ transactions entered by the Company during the FY 2024-25 with related parties were on an arm''s
length basis and in the ordinary course of business and approved by the Audit Committee. Certain transactions, which were
repetitive in nature, were approved through omnibus route.

There were no material transactions of the Company with any of its related parties as per the Act. Therefore the disclosure of the
Related Party Transactions as required under Section 134(3)(h) of the Act in AOC-2 is not applicable to the Company for FY 2024-25
and, hence, the same is not required to be provided.

During the FY 2024-25, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the
Company other than sitting fees and reimbursement of expenses, as applicable. The Policy on Related Party Transaction is
available on the Company''s website: https://www.kirloskarelectric.com/images/pdf/investor/policies/Policy-on-related-party-
transactions.pdf.

Your directors draw attention of the members to note no. 36(9) to the standalone financials statement which sets out the related party
disclosures.

Corporate Social Responsibility:

Since criteria''s for the applicability of CSR spending are not attracted to the Company, there was no obligation for the Company to
spend CSR amount for the FY 2024-25. However the CSR committee has been constituted and also CSR policy has been framed.

The policy can be accessed at the following URL: https://www.kirloskarelectric.com/investors/investors-information/policies.html.

A responsibility statement of the CSR Committee that the implementation and monitoring of CSR policy is in compliance
with CSR objectives and policy of the Company:

The CSR Committee hereby confirms that the implementation and monitoring of CSR policy has been carried out with all reasonable
care and diligence and the same is in compliance with the CSR objectives and the policy of the Company. However, as explained
above the CSR provisions are not applicable to the Company for the FY 2024-25 as per the requirements mentioned in the
Companies Act, 2013.

Material Changes affecting the Company:

There have been no material changes and commitments affecting the financial positions of the Company between the end of the
financial year and date of this report. There has been no change in the nature of business of the Company.

Significant and Material orders passed by the Regulators or Courts:

There were no significant and material orders passed against the Company by the regulators or courts or tribunals during financial
year 2024-25 impacting the going concern status and Company''s operations in future.

Vigil mechanism for Directors and Employees:

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal procedural course to the
directors and employees to report their concerns about any poor or unacceptable practices or any event of misconduct or violation of
Company''s code of conduct. The purpose of this policy is to provide a framework to secure whistle blowing incidents and to protect
the employees who are willing to raise concerns about serious irregularities within the Company. The policy provides for adequate
safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of

the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The policy of
Vigil Mechanism is available on the Company''s website at https://kirloskarelectric.com/investors/investorsinformation/policies.html.

Statutory auditor:

Pursuant to the provisions of section 139 and other applicable sections of the Companies Act, 2013, read with Companies (Audit and
Auditors) Rules, 2014, as amended, the Company at its 77^th AGM has re-appointed M/s. Prabhashankar & Co., Chartered
Accountants (Firm Registration No: 004982S) as the Statutory Auditors for a period of 3 years till the Conclusion of 80^th Annual
General Meeting.

Auditors'' Report:

The standalone and the consolidated financial statements of the Company have been prepared in accordance with Indian
Accounting Standards (Ind AS) notified under Section 133 of the Act.

The Auditors'' Report is enclosed with the financial statements in this Report. The Statutory Auditors were present in the last AGM.
Branch auditor:

M/s. BMS Auditing, Chartered Accountants, UAE were reappointed as the auditors for conducting audit of sales office at Ajman,
UAE. Based on the recommendation of the Audit Committee, the Board of Directors of the Company has proposed to appoint, M/s.
BMS Auditing, Chartered Accountants, as auditors for conducting audit of sales office at Ajman, UAE and to hold the office from the
conclusion of 78^th Annual General Meeting until the conclusion of 79^th Annual General Meeting of the Company subject to the
approval of the members of the Company.

Internal auditor:

The Company had appointed M/s. T. Sriram, Mehta & Tadimalla, Chartered Accountants (FRN: 004064S), Bengaluru as its internal
auditors for the year 2024-25.

Cost auditor:

M/s. Rao, Murthy and Associates, Cost Accountants (Firm Registration no. 000065), were appointed as cost auditors of the
Company for the financial year ended March 31,2025. The Board of Directors of your Company has fixed ?450,000/- (Rupees Four
Lakhs Fifty Thousand only) as audit fees, which requires ratification by the members of the Company in terms of the applicable
provisions of the Companies Act, 2013. Accordingly, a resolution seeking members'' approval has been set forth in the notice of the
78^th Annual General Meeting of the Company.

Disclosure under section 148(1) of the Companies Act, 2013:

During the period under review, the Company has conducted the audit of cost records and maintained the cost records as specified
by the Central Government under section 148(1) of the Companies Act, 2013.

Secretarial auditor:

M/s. S P Ghali & Co., Company Secretaries, Belgaum were appointed as secretarial auditors of the Company to conduct secretarial
audit for the financial year 2024-25 in terms of the provisions of Section 204 of the Companies Act, 2013. The audit report is enclosed
as Form MR - 3.

Further, as per Regulation 24A (1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Section 204 of
the Companies Act, 2013, and based on the recommendation of the Audit Committee, the Board of Directors at its meeting held on
July 10, 2025, has approved the appointment of Mr. Sudheendra P Ghali (Membership no. FCS 7037 & COP no. 7537) Proprietor of
M/s. S. P. Ghali & Co., Company Secretary, Belgaum as the Secretarial Auditors of the Company for a period of five (5) consecutive
years, commencing on from financial year 2025-26 till financial year 2029-30, to conduct Secretarial Audit of the Company and to
furnish the Secretarial Audit Report.

The resolution for appointment of secretarial auditor for a period of five years forms part of notice of 78^th Annual General Meeting.
Explanations or comments on auditors'' qualifications / adverse remarks / emphasis on matters:

a. The subsidiaries are taking active steps to repay the dues of the Company, from collection of book debts assigned and from
disposal of immovable properties transferred apart from debts transferred as referred in the auditor''s qualification. The Board of
directors is confident of realization of entire amounts due from the Subsidiaries or realizing much more amount from the sale of
immovable properties.

b. The Company is in the process of completing the review and reconciliation of receivables / book debts and in our opinion any
further provision required will not have material impact on the financial results of the Company and we are confident of realizing
the book debts.

The detailed Company''s explanation thereto has been given in the relevant notes to accounts.

Secretarial Standards:

During the financial year 2024-25, the Company has complied with provisions of applicable Secretarial standards issued by the
Institute of Company Secretaries of India.

Reporting of Fraud by Auditors:

During the year, under section 143(12) of the Companies Act 2013, neither the Internal Auditors, Statutory Auditors nor Secretarial
Auditors have reported to the Audit Committee or the Board of the Company any material fraud by its officers or employees therefore
no details are required to be disclosed under Section 134(3)(ca) of the Companies Act, 2013.

Details in respect of adequacy of internal financial controls with reference to the financial statement:

The Company has a robust system of internal financial control, which is in operation. The internal financial controls have been
documented, digitized and embedded in the day to day affairs of the business process of the Company. The effectiveness of the
internal financial controls are obtained through management reviews at regular intervals, assessments, monitoring by the functional
experts as well as auditing of the internal control systems by the internal auditors during the course of their audits. We believe that
these systems provide better assurance that our internal financial control systems are well designed and are operating effectively.

Corporate Governance:

Your Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance
requirements set out by the Securities and Exchange Board of India (“SEBI”).

Your Company''s corporate governance report for the financial year 2024-25 is appended to this annual report. A certificate on the
status of compliance on corporate governance is also appended and forms part of this annual report.

Prevention of Sexual Harassment at Workplace:

Your Company has zero tolerance policy in case of sexual harassment at workplace and committed to provide a healthy environment
to each and every employee of the Company. Your Company has in place ''Policy on Sexual Harassment Redressal'' and all
employees (permanent, contractual, temporary, trainees) are covered under this policy.

Your 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. Further, we report as follows for the year
ended on March 31,2025:

Sl. No	Particulars	Status
1	No of complaints received in the year	Nil
2	No of complaints disposed off in the year	Nil
3	Cases pending for more than 90 days	Nil
4	No of workshops and awareness programme(s) conducted in the year	2
5	Nature of action by employer or District office, if any	Nil

Statement on compliance with Maternity Benefit Act, 1961

As per the provisions of Companies (Accounts) Second Amendment Rules, 2025, it is hereby confirmed that the Company has
complied with all the applicable provisions of Maternity Benefit Act, 1961.

Merger and Acquisitions (M&A):

An application for the merger by absorption of four wholly-owned subsidiary companies - KELBUZZ Trading Private Limited (KTPL),
Luxquisite Parkland Private Limited (LPPL), SLPKG Estate Holdings Private Limited (SEHPL), and SKG Terra Promenade Private
Limited (STPPL) - with the holding company, Kirloskar Electric Company Limited (KECL), was filed before the National Company
Law Tribunal (NCLT), Bengaluru Bench, on October 31, 2024. The appointed date for this amalgamation is April 1, 2024. All
directions issued by the NCLT have been adhered to by the Company, with relevant filings and disclosures made periodically.
Participation and voting at 78^th AGM:

Pursuant to the General Circular No. 09/2024 dated September 19, 2024, issued by the Ministry of Corporate Affairs (MCA) and
Circular SEBI/HO/CFD/CFD-PoD-2/P/CIR/2024/133 dated October 3, 2024 issued by SEBI (hereinafter collectively referred to as
“the Circulars”), the 78^th AGM of the Company will be held through VC/OAVM. Electronic copy of the Annual Report for the year ended
March 31, 2025 and Notice of the AGM are being sent to all the members electronically whose email IDs are registered with the
Company / Depository Participants(s) for communication purposes and a letter providing the web-link, where complete details of the
Annual Report is available to those members who have not so registered.

A copy of the notice of the AGM and annual report are also available for download from the website of the Company at
www.kirloskarelectric.com.

Disclosure with respect to compliance to SEBI Listing Regulations, as amended from time to time:

The details with respect to Compliance with the SEBI Listing Regulations during the year are contained in the Corporate Governance
Report which forms part of the annual report.

Corporate Insolvency Resolution Process (CIRP):

As already disclosed in the previous year, two petitions seeking to initiate a Corporate Insolvency Resolution Process (CIRP) against
the Company were filed before the National Company Law Tribunal (NCLT), Bengaluru Bench, in accordance with Section 7 of the
Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority)

Rules, 2016. Both of these petitions were dismissed by the NCLT Bengaluru bench. While appeals were initially filed with the
National Company Law Appellate Tribunal, Chennai, the applicants have since withdrawn them. Therefore, there were no
proceedings either filed by the Company or against the Company, pending under the Insolvency and Bankruptcy Code, 2016, before
the National Company Law T ribunal or any other court.

Other disclosures and affirmations

There was no instance of one-time settlement with any bank or financial institution during the reporting period.

Acknowledgements:

The Board of Directors takes the opportunity to express its sincere appreciation for the continued support and confidence received
from the Company''s bankers, customers, suppliers, depositors and the shareholders.

The Company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the
Company and the Board puts on record the sincere appreciation of their dedication and loyalty.

By the order of the Board of Directors
For Kirloskar Electric Company Limited

Sd/-

Vijay R Kirloskar

Place: Bengaluru Executive Chairman

Date: 10.07.2025 DIN: 00031253

---

Mar 31, 2024

The directors are pleased to present the 77 Annual Report of Kirloskar Electric Company Limited (hereinafter referred as “the Company” or “KECL”) along with the audited financial statement for the financial year ended March 31, 2024. The consolidated performances of the Company and its subsidiaries have been referred to wherever required.

Review of performance and state of Company''s affairs:

During the year under report, your Company achieved a total turnover of ? 55,735 /- Lakhs (previous year ? 47,355/- Lakhs). The operations have resulted in loss of ? 839/- Lakhs (previous year profit was ? 1,066/- Lakhs) i.e., total comprehensive income for the period.

The financial summary and highlights are as follows:

(? in Lakhs)

PARTICULARS	Standalone		Consolidated
	2023-24	2022-23	2023-24	2022-23
Revenue from operations	55,735	47,355	55,735	47,355
Other income (Net)	793	1,608	799	2,225
Total Revenue	56,528	48,963	56,534	49,580
Total Expense	55,011	46,374	55,126	46,473
Profit before Exceptional items	1,517	2,588	1,408	3,108
Exceptional Items	-	-	-	-
Profit / (Loss) before tax	1,517	2,588	1,408	3,108
Tax Expense	-	0.16	-	0.16
Profit / (Loss) after tax	1,517	2,588	1,408	3,107
Total other comprehensive income	(2,356)	(1,522)	(2,356)	(1,522)
Total comprehensive income for the period	(839)	1,066	(948)	1,586

Note: The above figures are extracted from the audited standalone and consolidated financial statements as per Indian Accounting Standards (Ind AS).

Dividend:

In view of the accumulated losses, the Board of Directors of your Company has not recommended any dividend for the year under review.

Transfer to reserves:

In view of the accumulated losses, the Board of Directors of your Company has not transferred any amount to the reserves for the year under review.

Change in the nature of business:

There was no change in nature of the business of the Company during the financial year 2023-24.

Share Capital:

As on March 31,2024, the paid up share capital of your Company stood at ? 66,41,40,710/- divided into 6,64,14,071 equity shares of ? 10/- each.

Disclosure under section 43(a)(ii) of the Companies Act, 2013:

The Company has not issued any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 54(1)(d) of the Companies Act, 2013:

The Company has not issued any sweat equity shares during the financial year under review and hence no information as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 55(2) & 77 of the Companies Act, 2013:

The Company has not redeemed any shares / debentures during the financial year under review and hence no information as per provisions of Section 55(2) & 77 of the Act read with the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 62(1)(b) of the Companies Act, 2013:

The Company has not issued any equity shares under Employees Stock Option Scheme (''ESOS'') during the financial year under review and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 67(3) of the Companies Act, 2013:

During the financial year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 and hence no information has been furnished.

Transfer to Investor Education and Protection Fund:

During the year under review, no unclaimed / unpaid dividend and the corresponding shares were transferred to Investor Education and Protection Fund (“IEPF”).

The details of Nodal Officer of the Company, in line with the provisions of IEPF Regulations are available on the website of the Company at https://kirloskarelectric.com/investors/investors-information/investor-contacts.html.

As required under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“IEPF Rules”), during the year 2023-24, matured fixed deposits (cumulative & non-cumulative) aggregate to the sum of f 7,40,000/-(Rupees Seven Lakh Forty Thousand Only) along with the interest amount aggregated to f 81,445/- (Rupees Eighty One Thousand Four Hundred and Forty Five only), were transferred to the Investor Education and Protection Fund (“IEPF”) after the expiry period of seven years.

Fixed deposits:

SL.No.	Particulars	(fin Lakhs)
1.	Accepted / renewed during the year	Nil
2.	Remained unpaid or unclaimed at the end of the year.	10,00,000*
3.	Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved:- • At the beginning of the year • Maximum during the year • At the end of the year	N/A
4.	Details of deposits which are not in compliance with the requirements of Chapter V of the Act;	Nil

*The matured & unclaimed deposit of f10,00,000/- (Rupees Ten Lakhs only) along with the interest amount f29,795/- (Rupees Twenty Nine Thousand Seven Hundred and Ninety Five Only) has also been transferred to IEPF in April 2024. These are the deposits which are matured but are unclaimed. During the year under review, the Company has transferred the matured deposits to IEPF, as the Company did not receive claim from the deposit holders.The Company took all efforts to contact the FD Holders by sending them reminders.

The Company also has f 17,97,583/- in form of liquid assets as required under Section 73 of the Companies Act, 2013 read with rule 13 of the Companies (Acceptance of Deposits) Amendment Rules, 2018.

Credit Ratings:

Information regarding credit ratings obtained by the Company for the year under review has been given under the Corporate Governance Report which forms part of this Annual Report.

Subsidiaries, associate companies & joint ventures:

The Company has four wholly owned subsidiaries, one step-down subsidiary, one associate Company and one Joint Venture.

The consolidated financial statements of the Company and its Subsidiaries are prepared in accordance with the applicable accounting standards, issued by the Institute of Chartered Accountants of India, and forms part of this Annual Report.

Neither the Executive Chairman and nor the whole-time directors of the Company receive any remuneration or commission from any of its subsidiaries or associate Company.

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the reports on the performance and financial position of each of the subsidiary and associate companies have been provided in Form AOC-1 appended to this report.

Directors and Key Managerial Personnel:

Your Company has a well-diversified Board comprising of directors having skills, competencies and expertise in various areas to ensure effective corporate governance of the Company.

As on March 31,2024, the Board comprised of 10 (ten) directors, out of which 6 (six) were Non-Executive Independent Directors, 01 (one) Non Executive Non Independent Woman Director and 03 (three) Executive Directors. The Company is in compliance with the regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) regulations, 2015 (“SEBI Listing Regulations”).

In accordance with the provisions of section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mrs. Meena Kirloskar (DIN: 00286774), a Non-executive Director being longest in the office, shall retire by rotation and being eligible, has offered herself for re-appointment. The resolution seeking members'' approval for her re-appointment forms part of the AGM Notice.

During the year under review, Mr. Sarosh J Ghandy (DIN: 00031237), Non executive Independent Director of the Company resigned due to health reasons on June 02, 2023 and Mr. Mahendra V P (DIN: 00033270), Non-Executive Independent Director of the Company passed away on May 30, 2023. Mr. Vijay R Kirloskar (DIN: 00031253) was re-appointed as an Executive Chairman (Whole-time director) of the Company for a term of three (03) years, w.e.f August 12, 2023 and Mr. Suresh Kumar (DIN: 02741371), was appointed as an Independent Director of the Company for a term of five (05) consecutive years with effect from August 14, 2023.

The tenure Independent Directors, namely Mr. Kamlesh Gandhi (DIN: 00004969), Mr. Satyanarayan Agarwal (DIN: 00111187) & Mr. Anil Kumar Bhandari (DIN: 00031194) shall expire on September 21,2024.

The Key Managerial Personnel (KMP) of the Company as on March 31, 2024 were Mr. Vijay R Kirloskar, Executive Director, Mr. Anand B Hunnur, Managing Director, Mr. Sanjeev Kumar S, Director (Finance) & Chief Financial Officer and Mr. Mahabaleshwar Bhat, General Manager - Corporate Affairs & Company Secretary.

During the year under review, the Non-Executive Directors (NEDs) of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them, if applicable, for the purpose of attending Board/ Committee meetings of the Company.

The Board has appointed Ms. Rukmini Kirloskar (DIN: 00309266) as an Additional Director of the Company with effect from May 23, 2024, who shall hold the office upto the date of ensuing annual general meeting of the Company and subject to approval of members of the Company shall be appointed as a director liable to retire by rotation. Further, as per Regulation 17 (1C) of SEBI Listing Regulations, the Company has sought approval of members of the Company by way of postal ballot (e-voting period from July 23, 2024 to August 21,2024) for regularization of Director. The result of the e-voting shall be announced in terms of provisions of the Companies Act, 2013 by the Company on or before August 22, 2024.

The Board has appointed Mr. K N Shanth Kumar (DIN: 00487956) as an Additional Independent Director with effect from May 23, 2024, who shall hold the office upto the date of ensuing annual general meeting of the Company and subject to approval of members of the Company shall be appointed as an Independent Director for a term of five consecutive years, with effect from May 23, 2024. Further, as per Regulation 17 (1C) of SEBI Listing Regulations, the Company has sought approval of members of the Company by way of postal ballot (e-voting period from July 23, 2024 to August 21,2024) for regularization of Director as an Independent Director. The result of the e-voting shall be announced in terms of provisions of the Companies Act, 2013 by the Company on or before August 22, 2024.

The Board has appointed Mr. Mohammed Saad Bin Jung (DIN: 00264525) as an Additional Independent Director with effect from August 6, 2024, who shall hold the office upto the date of ensuing annual general meeting of the Company and subject to approval of members of the Company shall be appointed as an Independent Director for a term of five consecutive years, with effect from August 6, 2024. Approval of members has been sought for regularization which forms part of the Notice of 77^th AGM.

The Board has appointed Dr. Pangal Ranganath Nayak (DIN: 01507096) as an Additional Independent Director with effect from August 6, 2024, who shall hold the office upto the date of ensuing annual general meeting of the Company and subject to approval of members of the Company shall be appointed as an Independent Director for a term of five consecutive years, with effect from August 6, 2024. Approval of members has been sought for regularization which forms part of the Notice of 77^th AGM.

Independent Director proposed to be appointed:

a. The Board of directors considers that on account of vast knowledge and experience of Mr. K N Shanth Kumar (DIN: 00487956), Non-Executive Director of the Company, his appointment as Non-Executive Independent Director of the Company will be in the best interest of the Company. As stated above, as on the date of this report, the Company has sought approval of members by way of postal ballot.

b. The Board of directors considers that on account of vast knowledge and experience of Mr. Mohammed Saad Bin Jung (DIN: 00264525), Non-Executive Director of the Company, his appointment as Non-Executive Independent Director of the Company will be in the best interest of the Company.

c. The Board of directors considers that on account of vast knowledge and experience of Dr. Pangal Ranganath Nayak (DIN: 01507096), Non-Executive Director of the Company, his appointment as Non-Executive Independent Director of the Company will be in the best interest of the Company.

Declaration by Independent Directors

In terms of the provisions of Section 149(7) of the Companies Act, 2013, the Company has received declarations from all the Independent Directors stating that they continue to meet the criteria of independence as provided under the provisions of Section 149(6) of the Companies Act, 2013 read with the Rules made there under and the SEBI Listing Regulations.

In terms of regulation 25(8) of the SEBI Listing Regulations, Independent Directors have confirmed that they are not aware of any circumstances or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties. Based on the declarations received from the Independent Directors, the Board has confirmed that Independent Directors meet the criteria of independence as mentioned under regulation 16(1)(b) of SEBI Listing Regulations and that they are independent of the management.

All Independent Directors have affirmed compliance to the code of conduct for Independent Directors as prescribed in Schedule IV of the Companies Act, 2013 and the Code of Conduct for Directors and senior management personnel formulated by the Company.

All Independent Directors have registered their names in the Independent Director''s Databank. In the opinion of the Board, the Independent Directors so appointed / re-appointed possess the requisite expertise, experience and proficiency and are of integrity.

Evaluation of Directors, Committees and the Board:

The evaluation process has been explained in the Corporate Governance Report which forms part of the annual report.

Number of meetings of the Board of Directors and its Committees:

The Board of directors met 07 (Seven) times during the financial year 2023-24 under review out of which 06 (Six) meetings were held through Video Conference mode / other audio visual means and 01 (One) was physical meet.

The maximum interval between any two meetings was within the maximum allowed gap pursuant to the Companies Act, 2013 and SEBI Listing Regulations read with the Circulars issued by MCA and SEBI

The Board meetings were held on May 19, 2023, May 30, 2023, July 17, 2023, August 14, 2023, November 10, 2023, February 12, 2024 and March 28, 2024.

The composition and the details of the meetings of the Board and its Committee held during the year are contained in the Corporate Governance Report which forms part of the annual report.

Nomination and Remuneration Policy:

The Nomination and Remuneration Committee is responsible for recommending to the Board, a policy relating to the appointment and remuneration of the Directors, Key Managerial Personnel and other employees. The Nomination and Remuneration Policy is available on the website of the Company at https://kirloskarelectric.com/investors/investors-information/policies.html.

Features of Nomination and Remuneration Policy:

• The policy has been framed in line with the Company''s philosophy to ensure equitable remuneration to all the directors, key managerial personnel (KMP) and employees of the Company.

• The policy lays down the criteria, terms and conditions including qualifications and positive attributes for identifying persons who are qualified to become directors (executive and non-executive / Independent) and persons who may be appointed in senior management and key managerial positions of the company.

• The policy determines the remuneration of Directors, Key Managerial Personnel and other employees based on the Company''s size and financial position and trends and practices on remuneration prevailing in peer companies.

• This Policy is divided in three parts:

Part - A: covers matters to be dealt by the committee.

Part - B: covers appointments and nominations.

Part - C: covers remuneration and perquisites etc.

Risk Management Policy:

Your Company has devised and implemented a comprehensive ''Risk Management Policy'' which provides for identification, assessment and control of risks that the company would face in the normal course of business and mitigation measures associated with them. The Management identifies and controls risks through a properly defined framework in terms of the aforesaid policy. The

Risk management policy has been appended to this report as Annexure-I.

Managerial remuneration:

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is disclosed in the Annexure - IV.

Particulars of employees:

Iin terms of the provisions of Section 197(12) of the Companies Act, 2013 read with rules 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing disclosures pertaining to remuneration and also the names and other particulars of the employees drawing remuneration in excess of limits set out in the said rules are provided in a separate Annexure to the Board''s Report which forms part of the annual report. The Report and the accounts are being sent to the Members excluding the aforesaid annexure and in terms of Section 136 of the Companies Act 2013, the said annexure is open for inspection. Any Member interested in obtaining a copy of the same may write to the Company Secretary at [e-mail]

Annual Return:

According to the provisions of Section 134(3)(a), a copy of annual return i.e., Form MGT-7 for the year ended March 31, 2023 has been placed on the Company''s website: https://kirloskarelectric.com/investors/investors-information/financial.html.

Director''s Responsibility Statement:

We, the Directors of your Company, confirm, to the best of our knowledge and ability that:-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

(b) we have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit / loss of the Company for that period;

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

(d) we have prepared the annual accounts on a going concern basis;

(e) we have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively.

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

Particulars of loans, guarantee, investments and securities:

There were no loans and advances, guarantees, investments made or security given to any Body Corporate by the Company during the financial year 2023-24.

Particulars of loans, advances, investments as required under the listing regulations:

The details of related party disclosures with respect to loans, advances, investment at the year end and maximum outstanding amount thereof during the year as required (under part A of Schedule V of the Listing Regulations) have been provided in the notes to the financial statement of Company.

Your directors draw attention of the members to note no. 17 & 35(9) of the standalone financial statements which sets out the details of loan and advance, guarantee or investment.

Particulars of contracts or arrangements with related parties:

All contracts/ arrangements/ transactions entered by the Company during the FY 2023-24 with related parties were on an arm''s length basis and in the ordinary course of business and approved by the Audit Committee. Certain transactions, which were repetitive in nature, were approved through omnibus route.

There were no material transactions of the Company with any of its related parties as per the Act. Therefore the disclosure of the Related Party T ransactions as required under Section 134(3)(h) of the Act in AOC-2 is not applicable to the Company for FY 2023-24 and, hence, the same is not required to be provided.

During the FY 2023-24, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company other than sitting fees and reimbursement of expenses, as applicable. The Policy on Related Party Transaction is

available on the Company''s website: https://www.kirloskarelectric.com/images/pdf/investor/policies/Policy-on-related-party-transactions.pdf.

Your directors draw attention of the members to note no. 35(9) to the standalone financials statement which sets out the related party disclosures.

Corporate Social Responsibility:

Since criteria''s for the applicability of CSR spending are not attracted to the Company, there was no obligation for the Company to spend CSR amount for the FY 2023-24. However the CSR committee has been constituted and also CSR policy has been framed.

The policy can be accessed at the following URL: https://www.kirloskarelectric.com/investors/investors-information/policies.html.

A responsibility statement of the CSR Committee that the implementation and monitoring of CSR policy is in compliance with CSR objectives and policy of the Company:

The CSR Committee hereby confirms that the implementation and monitoring of CSR policy has been carried out with all reasonable care and diligence and the same is in compliance with the CSR objectives and the policy of the Company. However, as explained above the CSR provisions are not applicable to the Company for the FY 2023-24 as per the requirements mentioned in the Companies Act, 2013.

Conservation of energy, technology absorption, Research & development and foreign exchange earnings and outgo:

The relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure - II, which forms part of this report.

Material Changes affecting the Company:

There have been no material changes and commitments affecting the financial positions of the Company between the end of the financial year and date of this report. There has been no change in the nature of business of the Company.

Significant and Material orders passed by the Regulators or Courts:

There were no significant and material orders passed against the Company by the regulators or courts or tribunals during financial year 2023-24 impacting the going concern status and Company''s operations in future.

Vigil mechanism for Directors and Employees:

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal procedural course to the directors and employees to report their concerns about any poor or unacceptable practices or any event of misconduct or violation of Company''s code of conduct. The purpose of this policy is to provide a framework to secure whistle blowing incidents and to protect the employees who are willing to raise concerns about serious irregularities within the Company. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The policy of Vigil Mechanism is available on the Company''s website at https://kirloskarelectric.com/investors/investorsinformation/policies.html.

Statutory auditor:

Pursuant to the provisions of section 139 and other applicable sections of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014, as amended, the Company at its 72^nd AGM appointed M/s. Prabhashankar & Co., Chartered Accountants (Firm Registration No: 004982S) as the Statutory Auditors for a period of 5 years and the appointment term is expiring on the conclusion of ensuing AGM. Your Board of Directors has proposed to reappoint M/s. Prabhashankar & Co., for a period of 3 years from the conclusion of 77^th Annual General Meeting till the Conclusion of 80^th Annual General Meeting.

Pursuant to Section 141 of the Act, the auditors have represented that they are not disqualified and continue to be eligible to act as the Auditor of the Company. The resolution for reappointment of statutory auditors forms part of Notice of 77^th AGM.

Auditors'' Report:

The standalone and the consolidated financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under Section 133 of the Act.

The Auditors'' Report is enclosed with the financial statements in this Report. The Statutory Auditors were present in the last AGM. Branch auditor:

M/s. BMS Auditing, Chartered Accountants, UAE were reappointed as the auditors for conducting audit of sales office at Ajman, UAE. Based on the recommendation of the Audit Committee, the Board of Directors of the Company has proposed to appoint, M/s. BMS Auditing, Chartered Accountants, as auditors for conducting audit of sales office at Ajman, UAE and to hold the office from the conclusion of 77^th Annual General Meeting until the conclusion of 78^th Annual General Meeting of the Company subject to the

approval of the members of the Company.

Internal auditor:

The Company has appointed B K Ramadhyani & Co. LLP, Chartered Accountants (LLP Registration no.AAD-7041), Bengaluru as its internal auditors for the year 2023-24.

Cost auditor:

M/s. Rao, Murthy and Associates, Cost Accountants (Firm Registration no. 000065), were appointed as cost auditors of the Company for the financial year ended March 31,2024. The Board of Directors of your Company has fixed ?450,000/- (Rupees Four Lakhs Fifty Thousand only) as audit fees, which requires ratification by the members of the Company in terms of the applicable provisions of the Companies Act, 2013. Accordingly, a resolution seeking members'' approval has been set forth in the notice of the 77^th Annual General Meeting of the Company.

Disclosure under section 148(1) of the Companies Act, 2013:

During the period under review, the Company has conducted the audit of cost records and maintained the cost records as specified by the Central Government under section 148(1) of the Companies Act, 2013.

Secretarial auditor:

M/s. S P Ghali & Co., Company Secretaries, Belgaum were appointed as secretarial auditors of the Company to conduct secretarial audit for the financial year 2023-24 in terms of the provisions of Section 204 of the Companies Act, 2013. The audit report is enclosed as Form MR - 3.

Explanations or comments on auditors'' qualifications / adverse remarks / emphasis on matters:

a. The Company has made representation to the stock exchanges vide., its letter no. Sect./72/2023-24 dated November 10, 2023 regarding clarification for delay in intimation and also the Company has paid the fine to both the stock exchanges.

b. The subsidiaries are taking active steps to repay the dues of the Company, from collection of book debts assigned and from disposal of immovable properties transferred apart from debts transferred as referred in the auditor''s qualification. The Board of directors is confident of realization of entire amounts due from the Subsidiaries or realizing much more amount from the sale of immovable properties.

c. The Company is in the process of completing the review and reconciliation of receivables / book debts and in our opinion any further provision required will not have material impact on the financial results of the Company and we are confident of realizing the book debts

The detailed Company''s explanation thereto has been given in the relevant notes to accounts.

Secretarial Standards:

During the financial year 2023-24, the Company has complied with provisions of applicable Secretarial standards issued by the Institute of Company Secretaries of India.

Reporting of Fraud by Auditors:

During the year, under section 143(12) of the Companies Act 2013, neither the Internal Auditors, Statutory Auditors nor Secretarial Auditors have reported to the Audit Committee or the Board of the Company any material fraud by its officers or employees therefore no details are required to be disclosed under Section 134(3)(ca) of the Companies Act, 2013.

Management Discussion and Analysis:

The Management Discussion and Analysis Report (“MDAR”) for the year under review, as prescribed under Part B of Schedule V read with Regulation 34 of the SEBI Listing Regulations is appended hereto as Annexure - III and forms part of this report.

Details in respect of adequacy of internal financial controls with reference to the financial statement:

The Company has a robust system of internal financial control, which is in operation. The internal financial controls have been documented, digitized and embedded in the day to day affairs of the business process of the Company. The effectiveness of the internal financial controls are obtained through management reviews at regular intervals, assessments, monitoring by the functional experts as well as auditing of the internal control systems by the internal auditors during the course of their audits. We believe that these systems provide better assurance that our internal financial control systems are well designed and are operating effectively.

Corporate Governance:

Your Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance requirements set out by the Securities and Exchange Board of India (“SEBI”).

Your Company''s corporate governance report for the financial year 2023-24 is appended to this annual report. A certificate on the status of compliance on corporate governance is also appended and forms part of this annual report.

Prevention of Sexual Harassment at Workplace:

Your Company has zero tolerance policy in case of sexual harassment at workplace and committed to provide a healthy environment to each and every employee of the Company. Your Company has in place ''Policy on Sexual Harassment Redressal'' and all employees (permanent, contractual, temporary, trainees) are covered under this policy.

Your Company has complied with the provisions of section 11(3) of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (‘the POSH Act’) relating to the constitution of Internal Complaints Committee and in terms of section 22 of ‘the POSH Act’ read with Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Rules, 2013, we report as follows for the year ended on March 31,2024:

Sl. No	Particulars	Status
1	No of complaints received in the year	Nil
2	No of complaints disposed off in the year	Nil
3	Cases pending for more than 90 days	Nil
4	No of workshops and awareness programme(s) conducted in the year	4
5	Nature of action by employer or District office, if any	Nil

Participation and voting at 77^th AGM:

Pursuant to Circular nos. 14/2020, 17/2020, 20/2020, 02/2021, 10/2022 & 09/2023 dated April 08, 2020, April 13, 2020, May 05, 2020, January 13, 2021, December 28, 2022 & September 25, 2023 respectively issued by Ministry of Corporate Affairs and Circular SEBI/HO/CFD/CFD-PoD-2/P/CIR/2023/167 dated October 07, 2023 issued by SEBI, the 77^th AGM of the Company will be held through VC/OAVM. Electronic copy of the Annual Report for the year ended March 31,2024 and Notice of the AGM are being sent to all the members electronically whose email IDs are registered with the Company / Depository Participants(s) for communication purposes. A copy of the notice of the AGM and annual report are also available for download from the website of the Company at www.kirloskarelectric.com.

Disclosure with respect to compliance to SEBI Listing Regulations, as amended from time to time:

The details with respect to Compliance with the SEBI Listing Regulations during the year are contained in the Corporate Governance Report which forms part of the annual report.

Corporate Insolvency Resolution Process (CIRP):

The Company received two petitions for initiation of Corporate Insolvency Resolution Process under Section 7 of the Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 which were filed before the National Company Law Tribunal (''NCLT''), Bengaluru Bench against the Company on November 24, 2023. Subsequently, both the petitions were dismissed by the NCLT, Bengaluru Bench vide., orders dated May 20, 2024. Appeals against both the orders of the NCLT Bengaluru Bench were filed before the National Company Law Appellate Tribunal, Chennai on June 18, 2024. The necessary disclosures have been made to the stock exchanges from time to time.

The aforesaid alleged claims are already been disputed by the Company and is the subject matter of pending proceedings filed by the Company before the Additional City Civil and Sessions Court, Bangalore.

Acknowledgements:

The Board of Directors takes the opportunity to express its sincere appreciation for the continued support and confidence received from the Company''s bankers, customers, suppliers, depositors and the shareholders.

The Company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the Company and the Board puts on record the sincere appreciation of their dedication and loyalty.

By the order of the Board of Directors For Kirloskar Electric Company Limited

Sd/-

Vijay R Kirloskar

Place: Bengaluru Executive Chairman

Date: 06.08.2024 DIN: 00031253

---

Mar 31, 2018

Dear Shareholders,

The directors present the 71^st Annual Report of Kirloskar Electric Company Limited (hereinafter referred as “the company” or “KECL”) along with the audited financial statement for the financial year ended March 31, 2018. The consolidated performance of the company and its subsidiaries has been referred to wherever required.

Review of performance and state of company’s affairs:

During the year under report, your company achieved a turnover of Rs. 39,454/- lakhs (previous year Rs. 65,276/- lakhs). The operations have resulted in net loss of Rs. 7,569/- lakhs (previous year net loss was Rs. 1,196/- lakhs).

The financial highlights are as follows; (Rs. In Lakhs)

	Standalone		Consolidated
PARTICULARS	2017-18	2016-17	2017-18	2016-17
Revenue from operations	37,913	62,612	37,925	62,614
Other income (net)	1,541	2,664	670	1,660
Total Income	39,454	65,276	38,595	64,274
Total Expense	47,137	68,021	4,7309	69,509
Profit / (Loss) before tax	(7,683)	(2,745)	(8,714)	5,235
Tax Expense	-	(7)	-	(3)
Profit / (Loss) after tax	(7,683)	(2,738)	(8,714)	5,232
Other comprehensive income (Net)	114	1,542	114	1,542
Total comprehensive income / (Loss) for the period	(7,569)	(1,196)	(8,600)	3,690

Note: The above figures are extracted from the audited standalone and consolidated financial statements as per Indian Accounting Standards (Ind AS)

Dividend:

In view of the losses, your directors do not recommend any dividend for the year.

Reserves:

The company has not transferred any amount to the general reserve account during the period under review.

Abridged Annual Report:

In terms of the provisions of regulation 36 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, and Section 136 of the Companies Act, 2013, the Board of directors has decided to circulate the abridged annual report containing the salient features of the Balance Sheet and Statement of Profit and Loss account to the shareholders for the financial year ended on March 31, 2018. Full version of the annual report will be available on company''s website www.kirloskar-electric.com and will also be made available to investors upon request.

Fixed deposits:

SL. No.	Particulars	Amount in Lakhs
1.	Accepted during the year	Nil
2.	Remained unpaid or unclaimed at the end of the year.	622.9
3.	Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved - At the beginning of the year - Maximum during the year - At the end of the year	N/A
4.	Details of deposits which are not in compliance with the requirements of Chapter V of the Act	Nil

Subsidiaries, associate companies & joint ventures:

The company has six wholly owned subsidiaries and one associate company.

Reports on the performance and financial position of each of the subsidiary and associate companies have been provided in Form AOC-1 appended to this report.

Directors and Key Managerial Personnel

Mr. Vijay R Kirloskar (DIN: 00031253) has been reappointed as Executive Chairman of the company effective from August 12, 2017 for a period of three (3) years.

Mr. Anand B Hunnur (DIN: 06650798) has been appointed as Managing Director of the company effective from May 26, 2017 for a period of three (3) years.

Mr. Vinayak N Bapat (DIN: 06936639) has resigned from the position of Managing Director, due to personal reason and has ceased to be Managing Director effective from August 11, 2017.

In accordance with the provisions of section 152 of the Companies Act, 2013 and Articles of Association of the company, Mrs. Meena Kirloskar (DIN: 00286774), Non-executive Director being longest in the office, shall retire by rotation and being eligible, offer herself for re-appointment seeking members'' approval and the same has been set forth in the notice of the 71^st annual general meeting of the company.

Mr. Soumendra Kumar Mahapatra has resigned from the position of chief financial officer, due to personal reason and has ceased to be chief financial officer effective from August 12, 2017.

Mr. Sanjeev Kumar S has been appointed as the chief financial officer of the company effective from August 10, 2017.

Mr. Chinmoy Patnaik has resigned from the position of Associate Vice President - Legal & Company Secretary, due to personal reason and has ceased to be Associate Vice President - Legal & Company Secretary effective from October 31, 2017.

Ms. K S Swapna Latha has been appointed as Sr. General Manager - Legal & Company Secretary of the company effective from February 12, 2018.

In terms of the provisions of Section 149 (7) of the Companies Act, 2013, the company has received declarations from all the independent directors stating that they continue to meet the criteria of independence as provided under the provisions of Section 149 (6) of the Companies Act, 2013.

Evaluation of Directors, Committees and the Board:

The evaluation process has been explained in the Corporate Governance Report which forms part of the annual report.

Number of meetings of the Board of directors and its committees:

Six meetings of the Board of directors were held during the financial year 2017-18. The composition of Committee and others details are contained in the Corporate Governance Report which forms part of the annual report. The Nomination and remuneration policy and risk management policy has been appended to this report as Annexure I and Annexure II respectively.

Managerial remuneration:

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is disclosed in the Form MGT - 9.

Particulars of employees:

In terms of the provisions of Section 197(12) of the Companies Act, 2013 the names and other particulars of specified employees are set out in annexure to the Board''s report. Having regard to provisions of Section 136(1) of the Companies Act, 2013, the annual report excluding the aforesaid information is being sent to the members of the company. The said information is avaible for inspection on all working days, during business hours at the registered office of the company. Any member interested in obtaining such information may write to Company Secretary and the same will be furnished on request.

Corporate Social Responsibility:

In pursuance of the provisions of the Companies Act, 2013 and CSR Policy of the company, it is required to spend two percent of the average net profits of the company for the three immediately preceding financial years. The company has incurred heavy losses in preceding three financial years and the average net profits for three financial years is in negative, thus the company was not required to spend any money for the CSR activities during the financial year ending March 31, 2018.

Vigil mechanism for Directors and Employees:

The company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism to the directors and employees to report their concerns about any poor or unacceptable practices or any event of misconduct or violation of company''s code of conduct. The purpose of this policy is to provide a framework to secure whistle blowing. It is to protect the employees who are willing to raise concerns about serious irregularities within the company. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the company has been denied access to the Audit Committee. The policy of Vigil Mechanism is available on the company''s website (URL:http://www.kirloskar-electric.com/images/pdf/investor/policies/Whistle-Blower-Policy.pdf

Prevention of Sexual Harassment at Workplace:

Your company has zero tolerance policy in case of sexual harassment at workplace and committed to provide a healthy environment to each and every employee of the company. The company has in place ‘Policy on sexual harassment Redressal''. In terms of section 22 of the Sexual Harassment of Women at workplace (Prevention Prohibition and Redressal) Act, 2013 read with Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Rules, 2013, we report as follows for the year ended on March 31, 2018;

Sl. No	Particulars	Status
1	No of complaints received in the year	Nil
2	No of complaints disposed off in the year	Nil
3	Cases pending for more than 90 days	Nil
4	No of workshops and awareness programmes conducted in the year	5
5	Nature of action by employer or District office, if any	Nil

Particulars of loans, guarantee, investments and securities:

There was no loan and advance, guarantee or investment made by the company during the year under report.

Particulars of loans, advances, investments as required under the listing regulations:

The details of related party disclosures with respect loans, advance, investment at the year end and maximum outstanding amount thereof during the year as required under (part A of Schedule V of the Listing Regulations have been provided in the notes to the financial statement of company.

Your directors draw attention of the members to note no. 7 & 37(9) of the standalone financial statements which sets out the details of loan and advance, guarantee or investment.

Particulars of contracts or arrangements with related parties:

The particulars of every contract or arrangements entered into by the company with related parties referred to in subsection (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto are disclosed in Form No. AOC -2 appended hereto.

All related party transactions that were entered into during the financial year were on an arm''s length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 (‘the Act'') and SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 and the provisions of Section 188 of the Companies Act, 2013 are not attracted.

There were no materially significant related party transactions made by the company during the year that would have required Shareholder approval as per provision of Companies Act 2013 read with applicable rules and Regulation 23 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015.

All related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted along with a statement giving details of all related party transactions is placed before the Audit Committee from time to time.

The Policy on Related Party Transaction is available on the company''s website (URL: http://www.kirloskar-electric.com/ images/pdf/investor/policies/Policy-on-related-party-transactions.pdf

Your directors draw attention of the members to note no. 37(13) to the standalone financials statement which sets out the related party disclosures.

Share Capital:

As at March 31, 2018, the paid up share capital of your company stood at Rs. 664,140,710/- divided into 66,414,071 Equity Shares of Rs. 10/- each.

Disclosure under section 43(a)(ii) of the Companies Act, 2013:

The company has not issued any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 54(1)(d) of the Companies Act, 2013:

The company has not issued any sweat equity shares during the financial year under review and hence no information as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished.

Disclosure under section 62(1)(b) of the Companies Act, 2013:

The company has not issued any equity shares under Employees Stock Option Scheme during the financial year under review and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 has been furnished shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 and hence no information has been furnished.

Disclosure under section 67(3) of the Companies Act, 2013:

During the financial year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 and hence no information has been furnished.

Secretarial Standards:

The Board confirms the compliance with applicable Secretarial Standards i.e., SS-1 and SS-2 relating to meeting of the Board of directors and General meeting respectively have been duly followed by the company.

Statutory audit:

M/s. Ashok Kumar, Prabhashankar & Co., Chartered Accountants, (Registration no. AAD-7041) were appointed as auditors of the company to hold office from the conclusion of the 70^th annual general meeting until the conclusion of the 72^nd annual general meeting. The proposed appointment is as per section 139 and 142 of the Companies Act, 2013. Subsequent to amendment of Companies (Amendment) Act, 2017 the company is not required to ratify their appointment.

Internal audit:

The company has appointed M/s. B K Ramadhyani Co. LLP as its internal auditors for 2017-18.

Cost audit:

M/s. Rao, Murthy and Associates, Cost Accountants, were appointed as cost auditors of the company for the financial year ended March 31, 2018. The Board of directors of your company has fixed Rs. 350,000/- (Rupees three lakhs fifty thousand only) as audit fees, which requires ratification by the members of the company in terms of the applicable provisions of the Companies Act, 2013. Accordingly, a resolution seeking members'' approval has been set forth in the notice of the 71^st annual general meeting of the company.

Disclosure under section 148(1) of the Companies Act, 2013:

During the period under review, the company has conducted the audit of cost records and maintained the cost records as specified by the Central Government under section 148(1) of the Companies Act, 2013.

Secretarial Audit:

M/s. Swaroop, Ravishankar & Associates, Company Secretaries, were appointed as secretarial auditors for the financial year 2017-18 to conduct secretarial audit in terms of the provisions of Section 204 of the Companies Act, 2013. The audit report is enclosed as Form MR - 3.

Explanations or comments on auditors’ qualifications / adverse remarks / emphasis on matters:

The comments / observations of the auditors are self-explanatory and company''s explanation thereto has been given in the relevant notes to accounts.

Extract of annual return:

According to the provisions of Section 92(3) of the Companies Act, 2013, an extract of the annual return is appended hereto as Form MGT-9, which forms part of this report.

Director’s Responsibility Statement:

We, the directors of your company, confirm, to the best of our knowledge and ability that-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

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

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

(d) we have prepared the annual accounts on a going concern basis;

(e) we have laid down internal financial controls to be followed by the company and such internal financial controls are adequate and operating effectively.

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

Corporate Governance:

Your company''s corporate governance report for the financial year 2017-18 is appended to this annual report. A certificate on the status of compliance on corporate governance is also appended and forms part of this annual report.

Material changes affecting the company:

There have been no material changes and commitments affecting the financial positions of the company between the end of the financial year and date of this report. There has been no change in the nature of business of the company.

No fraud has been reported by auditors to the Audit Committee of the Board.

Neither the Chairman and nor the Managing Director of the company receive any remuneration or commission form any of its subsidiaries.

Significant and material orders passed by the Regulators or Courts

There were no significant and material orders passed against the company by the regulators or courts or tribunals during financial year 2017-18 impacting the going concern status and company''s operations in future.

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

The relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure - III, which forms part of this report.

Management Discussion and Analysis:

Management discussion and analysis, is appended hereto as Annexure - IV and forms part of this report.

Details in respect of adequacy of internal financial controls with reference to the financial statement:

Internal Financial Controls:

The company has a robust system of internal financial control, which is in operation. The internal financial controls have been documented, digitized and embedded in the day to day affairs of the business process of the company. The effectiveness of the internal financial controls are obtained through management reviews at regular intervals, assessments, monitoring by the functional experts as well as auditing of the internal control systems by the internal auditors during the course of their audits. We believe that these systems provide better assurance that our internal financial control systems are well designed and are operating effectively.

Acknowledgements:

The Board of directors takes the opportunity to express its sincere appreciation for the continued support and confidence received from the company''s bankers, customers, suppliers, depositors and the shareholders.

The company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the company and the Board puts on record the sincere appreciation of their dedication and loyalty.

For and on behalf of the Board of directors,

Kirloskar Electric Company Limited

Vijay R Kirloskar

Place: Hubli Executive Chairman

Date: 08-08-2018 DIN : 00031253

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Mar 31, 2016

Dear Members,

The directors have the pleasure of presenting the 69th Annual Report on the business and operations of your company, together with the audited financial statement (including the consolidated financial statement) of your company for the financial year ended March 31, 2016.

Performance review and the state of company’s affairs

During the year under report, your company achieved a turnover of Rs, 54,775/- lakhs (previous year Rs, 51,081/- lakhs). The operations have resulted in net loss of Rs, 3,113/- lakhs (previous year Rs, 12,975/- lakhs).

In view of the losses, your directors do not recommend any dividend for the year.

The Financial Highlights of the company are as follows:

(Rs, Lakhs)

PARTICULARS	2015-16	2014-1 5
Total Revenues	54, 775.15	51, 080.32
Profit before depreciation and taxes	(5268.22)	(10590.32)
Profit before taxes	(3113.04)	(12974.63)
Provision for taxes (Incl. Deferred Tax)	-	-
Profit for the year after taxes	(3113.04)	(12974.63)
Balance brought forward from previous year	(5992.93)	(6284.82)
Profit available for appropriation	-	696.88
Transfer to general reserve	-	-
Balance carried to balance sheet	(9105.97)	(5992.93)

Details in respect of adequacy of internal financial controls with reference to the financial statement

The company has system of internal financial control, which is in operation.

Details of subsidiary companies

Your company has six wholly owned subsidiaries and one associate company.

Report on the performance and financial position of each of the subsidiaries & associate company has been provided in Form AOC-1 appended to this report.

Fixed Deposits

SL. No.	Particulars	Amount in Lakhs
1.	Accepted during the year	Nil
2.	Remained unpaid or unclaimed at the end of the year.	2, 752
3.	Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved - At the beginning of the year - Maximum during the year - At the end of the year	NA
4.	Details of deposits which are not in compliance with the requirements of Chapter V of the Act	NIL

Share Capital

Your company had issued 1,595,890 Compulsorily Convertible Preference Shares (CCPS) of Rs, 100/- each to Mr. Vijay R Kirloskar, Executive Chairman, during the financial year 2014 -15. According to the terms of the issue, the CCPS were required to be converted into Equity Shares in two tranches within a period of eighteen months from the date of the issue. In accordance with the terms of the issue, the Board of directors at its meeting held on February 11, 2016 approved conversion of first tranche aggregating to 777,485 CCPS. Upon the conversion, 2,554,156 Equity Shares of Rs, 10/- each were issued at a premium of Rs, 20.44/- per share to Mr. Vijay R Kirloskar.

As at March 31, 2016, the paid up share capital of the company was Rs, 639,177,730/- divided into 55,733,723 Equity Shares of Rs, 10/- each and 818,405 Compulsorily Convertible Preference Share of Rs, 100/- each.

Statutory audit:

M/s. B.K. Ramadhyani & Co. LLP (LLP registration No. AAD-7041), Chartered Accountants, and M/s. Sunder & Associates (AF No. 1172), Chartered Accountants, Malaysia, are the retiring auditors. They are eligible for reappointment and have submitted written consents along with other documents as required under the applicable provisions of the Companies Act, 2013. The audit committee and the Board have recommended M/s. B.K. Ramadhyani & Co. LLP, Chartered Accountants, to be appointed as auditors of the company for the financial year ended March 31, 2017 and M/s. Sunder & Associates, Chartered Accountants, Malaysia, as auditors to audit the accounts of the Malaysia sales office and report thereon.

Internal audit

The company has appointed M/s. KPMG Ltd. as its internal auditors.

Cost audit

M/s. Rao, Murthy and Associates, Cost Accountants, were appointed as cost auditors of the company for the financial year ended March 31, 2016. Your company has fixed Rs, 4, 50,000/-as audit fees, which requires ratification by the members of the company in terms of the applicable provisions of the Companies Act, 2013.

The audit committee of the Board and the Board of directors has recommended M/s. Rao, Murthy and Associates, Cost Accountants, for appointment as cost auditors of the company for the financial year 2016-17. Appropriate resolution seeking members approval on the proposed appointment including the audit fees payable to them are set forth in the notice of the 69th annual general meeting of the company.

Secretarial Audit:

M/s. Swaroop, Ravishankar & Associates, Company Secretaries were appointed as secretarial auditor for the financial year ended March 31, 2016 to conduct secretarial audit in terms of the provisions of Section 204 of the Companies Act, 2013 and the audit report is enclosed as Form MR - 3.

Extract of annual return

According to the provisions of Section 92(3) of the Companies Act, 2013, an extract of the annual return is appended hereto as Form MGT-9, which forms part of this report.

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

The relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure I, which forms part of this report.

Directors and key managerial personnel

Mrs. Meena Kirloskar, director, is liable to retire by rotation and, being eligible, seeks reappointment.

Late Shri A.S. Lakshmanan, director, passed away on October 13, 2015.

Mr. Ram J. Shahaney, director has resigned from the Board of directors effective from March 14, 2016.

Dr. Ashok Misra, director, has been appointed as an independent director for a period of consecutive five years effective from November 5, 2015. His appointment is being proposed for approval of the members at the 69th annual general meeting.

In terms of the provisions of Section 149 (7) of the Companies Act, 2013, the company has received declarations from all the independent directors stating that they continue to meet the criteria of independence as provided under the provisions of Section

149 (6) of the Companies Act, 2013.

Mr. Chinmoy Patnaik has been appointed as Associate Vice President - Legal and Company Secretary effective from November 18, 2015.

Board evaluation

Your company believes that it is the effectiveness of the Board that contributes to the company’s performance. The criteria for Board evaluation contemplates evaluation of directors’ performance based upon their performance as directors apart from their specific role as independent, non-executive and executive directors. Details on the committees of the Board are provided in the corporate governance report attached to this annual report.

The criteria also specifies that the Board would evaluate each committee’s performance based on the mandate on which the committee has been constituted and the contributions made by each member of the said committee in effective discharge of their responsibilities.

The Board of directors of your company has made annual evaluation of its performance, its committees and directors for the financial year 2015-16.

Number of meetings of the Board of directors

Seven meetings of the Board of directors were held during the year 2015-16. For further details, please refer to the corporate governance report.

Vigil mechanism for directors and employees

The company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism to the directors and employees to report their concerns about any poor or unacceptable practices or any event of misconduct or violation of company’s code of conduct. The purpose of this policy is to provide a framework to secure whistle blowing. It is to protect the employees who are willing to blow whistles. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the company has been denied access to the Audit Committee. The policy of Vigil Mechanism is available on the company’s website (URL:http://www. kirloskar-electric.com/images/pdf/investor/policies/Whistle-Blower-Policy.pdf).

Particulars of contracts or arrangements with related parties

The particulars of every contract or arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto are disclosed in Form No. AOC -2 appended hereto. The Policy on Related Party Transaction is available on the company’s website (URL:http://www. kirloskarelectric.com/images/pdf/investor/policies/RPT-policy.pdf).

Managerial remuneration

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is disclosed in the Form MGT - 9.

Corporate Governance

Your company’s corporate governance report for the fiscal 2016 is attached to this annual report. A certificate on the status of compliance on corporate governance is also appended and forms part of this annual report.

Management Discussion and Analysis

Management discussion and analysis is appended hereto as Annexure - II and forms part of this report.

Nomination and Remuneration Policy

The company has adopted nomination and remuneration policy, which is appended to this report as Annexure - III.

Risk Management Policy

The company has also adopted and implemented a policy on Risk Management, which is appended to this report as Annexure - IV. Particulars of employees

In terms of the provisions of Section 197 (12) of the Companies Act, 2013, the names and other particulars of specified employees are set out in the annexure to the Board’s Report. Having regard to the provisions of section 136 (1) of the Companies Act, 2013, the Annual Report is being sent to all members of the company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the company.

Particulars of loans, guarantees or investments

The details of loans, guarantees or investments made during the year are given below: (Rs, In Lakhs)

Sl. No.	Companies	Nature of Transaction	Loans	Guarantees	Investments
1.	KELBUZZ Trading Private Limited	Investment in Shares	Nil	Nil	Nil
2.	Luxquisite Parkland Private Limited	Investment in Shares	Nil	Nil	Nil
3.	SLPKG Estate Holdings Private Limited	Investment in Shares	Nil	Nil	Nil
4.	SKG Terra Promenade Private Limited	Investment in Shares	Nil	Nil	Nil
5	Kirsons B.V	Investment in Shares	Nil	Nil	Nil
6.	Swaki Habitat Private Limited	Nil	Nil	Nil	1.00
7.	Kesvik Developers Private Limited	Nil	Nil	Nil	1.00

Director’s Responsibility Statement

We, the directors of your company, confirm, to the best of our knowledge and ability, 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) we had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) we had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) we had prepared the annual accounts on a going concern basis; and

(e) we had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

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

Explanations or comments on auditors’ qualifications / adverse remarks / emphasis on matters:

A. Auditor’s Report

The comments /observations of the auditors are self-explanatory and the company’s explanations thereto have been given in relevant notes in the Notes to Accounts on page 62.

B. Secretarial Audit Report

In reply to the comments offered by the secretarial auditor, we wish to offer response as under:

Remark/ comment of the auditor

“The company has not filed standalone financials for its subsidiary companies and consolidated financials for the year" Management’s response

The company faced technical issues while uploading the concerned forms on the website of the Ministry of Corporate Affairs (MCA). The company raised tickets, approached MCA help desk number of times and also wrote to Registrar of Companies seeking resolution on the matter. The company could upload the forms on July 27, 2016.

Acknowledgements:

The Board of directors took this opportunity to express its sincere appreciation for the continued support and confidence received from the company’s Bankers, customers, suppliers, depositors and the shareholders.

The company considers its employees as its most important asset. Employees at all levels have put in their best to the services of the company and the Board puts on record the sincere appreciation of their dedication and loyalty.

For and on behalf of the Board of directors,

Kirloskar Electric Company Limited

Place: Bengaluru Vijay R Kirloskar

Date: 12.08.2016 Executive Chairman

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Mar 31, 2014

The Shareholders

The Directors have pleasure in presenting the 67th Annual Report on the business operations of the company, together with the Audited Statement of Accounts for the year ended 31st March, 2014. The financial highlights on the Business operations of the Company are as follows:

Company''s Performance

During the year under report, your Company has achieved a turnover of Rs. 67,984.27 lakhs (previous year Rs.80,194.27 lakhs). The operations have resulted in a net loss of Rs.4,100.96 lakhs (previous year net profit of Rs. 416.03 lakhs). Industry Outlook

The market for your company products remains subdued. The present manufacturing capacity in India is in far excess of the existing demand. This has lead to very aggressive competition and subsequent negative pressure on the prices of products. Your Company has taken several steps to mitigate the impact of this by taking several measures for optimizing the capacity utilization, market reach and performance.

Dividend

In order to conserve resources for Company'' s growth, your Directors do not propose to declare any dividend for the year under report. The Company has not transferred any amount to its General Reserve.

Subsidiary - Kirsons B.V.

The operations of Kirsons B.V., your subsidiary have resulted in net loss of € 2.94 lakhs (Previous year € 1.04lakhs). Subsidiary Companies

The Company as of March 31, 2014 had one subsidiary, viz., Kirsons B.V., Netherlands (Kirsons). Kirsons is having two subsidiaries - Lloyd Dynamowerke GmbH & Co. KG, Germany and Lloyd Beteiligungs-GmbH, Germany. Pursuant to section 212 of the Companies Act, the annual accounts of subsidiary companies for the year ended 31st March, 2014 along with the statements referred to in the said section, are attached with Consolidated Financial Statements as required.

Lloyd Dynamowerke GmbH & Co. KG, Germany (LDW)

As you are aware, your Company holds 94.89% shares in Lloyd Dynamowerke GmbH & Co. KG, Germany and the entire shareholding in Lloyd Beteiligungs-GmbH, Germany through its subsidiary in The Netherlands - Kirsons B.V. Lloyd Dynamowerke GmbH & Co. KG,Germany is a limited partnership existing in accordance with the Laws of Germany which owns an electrical machine manufacturing plant at Bremen. During the year ended 31st March, 2014 Lloyd Dynamowerke GmbH & Co. KG, had turnover of € 390.41 lakhs(Rs.31,622.97 lakhs) {Previous year € 399.57 lakhs (Rs. 27,942 lakhs)} with a net loss after tax of € 58.43 lakhs(Rs.4,826.92 lakhs) {Previous year net loss € 64.60 lakhs (Rs.4,496 lakhs)}. Rotating Machines Group

During the year under review the sales under Rotating Machines Group amounted to Rs.68,983.02 lakhs as against Rs.69,935.88 lakhs in 2012-13.

Power Generation and Distribution Group

During the year under review the sales under Power Generation and Distribution Group amounted to Rs.31,608.77 lakhs as against Rs.40,861.21 lakhs in 2012-13.

Others

During the year under review the sale of other Electrical Products amounted to Rs.5,368.11 lakhs as against Rs.4,719.32 lakhs in 2012-13.

Human Resources

The Company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the Company and the Board puts on record the sincere appreciation of their dedication and loyalty. The Company focuses on building an organization through induction and development of talent to meet current and future needs. Various HR initiatives have been taken to align the HR Policies of the Company with the growth projections of the Company. The Company has 1686 employees as on 31.03.2014.

Environment, Safety and Energy Conservation

As required by the Companies (Disclosure of particulars in the Report of Directors) Rules, 1988, the relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure to this report.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975,the names and other particulars of specified employees are set out in the Annexure to the Directors Report. However having regard to the provisions of section 219(1 )(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all members of the Company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company.

Corporate Governance

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following:

1. Management Discussion and Analysis Report

2. Report on Corporate Governance

3. Auditors Certificate regarding compliance of conditions of Corporate Governance

4. CEO & CFO Certificate

5. CEO Certificate regarding compliance with the Code of Conduct.

These annexures form part of this report.

Directors

Mr.A.S.Lakshmanan retire by rotation at the ensuing Annual General Meeting and is eligible for re-appointment.

The Board has appointed Mr. K.Ganesh as an Additional Director of the Company at their meeting held on 30th September, 2013. Mr. K.Ganesh hold office upto the date of the Annual General Meeting and has been proposed for appointment.

The Board has appointed Mr.S.N.Agarwal, Mr.Sarosh J Ghandy, Mr.Anil Kumar Bhandari, Mr.V.P.Mahendra, Mr.Kamlesh Gandhi and Mr.Ram J Shahaney, as non Executive Independent Directors for a period of five years from the date of this Annual General Meeting and are not liable to retire by rotation.

The Board has appointed Mr. Vinayak Narayan Bapat as an Additional Director of the Company at their meeting held on 12th August, 2014. Mr. Vinayak Narayan Bapat hold office upto the date of the Annual General Meeting and has been proposed for appointment. He is appointed as Managing Director for a period of three years w.e.f. 12th August 2014.

The Board has appointed Mr. Anand B Hunnur as an Additional Director of the Company at their meeting held on 12th August, 2014. Mr. Anand B Hunnur hold office upto the date of the Annual General Meeting and has been proposed for appointment. He is appointed as Director - Sales for a period of three years w.e.f. 12th August 2014.

The Board has appointed Mr.Vijay R Kirloskar as Executive Chairman for a term of three years w.e.f. 12th August 2014. Mr.Alok Kumar Gupta, Joint Managing Director, resigned from the services of the Company from the close of office hours on 25th April, 2014. Your Directors place on record their appreciation of the valuable services rendered by Mr. Gupta during his tenure as a Director of the Company.

Directors'' Responsibility Statement

Pursuant to the Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been generally followed.

2. Appropriate accounting policies have been selected and applied consistently and Directors have 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 as at 31st March, 2014 and of the Profit and Loss Account for the year ended 31st March, 2014.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The annual accounts have been prepared on a going concern basis.

Auditors

M/s. B. K. Ramadhyani & Co., Chartered Accountants and M/s. Sundar & Associates, Chartered Accountants, are the retiring Auditors in India and Malaysia respectively. They are eligible for re-appointment. The required certificates to the effect that the re-appointments, if made, will be within the limit specified in Section 224(1 B) of the Companies Act, have been received from M/s. B. K. Ramadhyani & Co., and M/s. Sundar & Associates.

Fixed Deposits

40 persons had not claimed repayment of their matured deposits amounting to Rs.61.30 lakhs as at 31st March, 2014. Out of the above upto the date of this report, 34 Fixed Deposit amounting to Rs.57.60 lakhs has been repaid and balance 6 Fixed Deposit amounting to Rs.3.70 lakhs had not been claimed.

Directors'' Responsibility Statement

The Directors'' Responsibility Statement in conformity with the requirement of the Companies Act, 1956 and the Companies Act, 2013 has been included in the Directors'' Report to the Shareholders. A Management Discussion and Analysis Report in terms of item IV (F) of Clause 49 of the Listing Agreement has been annexed to the Directors'' Report.

The financial accounts are in conformity with the requirements under the Companies Act, 1956 and the Companies Act, 2013. These accounts reflects the form and substance of transactions and present a true and fair view of the Company''s financial conditions and the results of operations.

The Company has a system of internal control which is reviewed, evaluated and updated on an ongoing basis. The Internal Audit Department has conducted periodic audit of systems and procedures to provide reasonable assurance that the activities are conducted in a manner not prejudicial to the interests of the Company.

The financial statements have been audited by M/s B.K. Ramadhyani & Co., Chartered Accountants and have been reviewed by and discussed in the Audit Committee Meeting.

Information pursuant to Clause 49 IV (G) (i) ( c) of the Listing Agreement

The details required under Clause 49 IV (G) (i) ( c) of the Listing Agreement are given in the notice convening the meeting.

Acknowledgements

The Board of Directors take this opportunity to express its sincere appreciation for the continued support and confidence received from the Company'' s Bankers, Financial Institutions, Customers, Suppliers, Depositors, Shareholders and Employees.

For and on behalf of the Board of Directors of Kirloskar Electric Company Limited

Place : Bangalore Vijay R Kirloskar

Date : August 12, 2014 Chairman

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Mar 31, 2013

To The Shareholders

The Directors have pleasure in presenting the 66th Annual Report on the business operation of the company, together with the Audited Statement of Accounts for the year ended 31st March, 2013. The financial highlights on the Business operations of the Company are as follows:

FINANCIAL HIGHLIGHTS

(Rs.in Lakhs) Particulars Year ended Year ended 31.03.2013 31.03.2012

Income 80,194.27 87,173.97

Expenditure 59,121.75 65,585.89

Gross Profit 21,072.52 21,588.08

Operating expenses 16,339.37 15,486.09

Operating Profit before interest and depreciation 4,733.15 6,101.99

Interest 3,357.92 3,830.46

Depreciation, amortisation and provisions 1,703.29 1,838.89

Operating profit before tax and extraordinary items (328.06) 432.64

Other income (net) 901.83 576.26

Net profit before tax and after extraordinary items 573.77 1,008.90

Provision for taxation 157.74 52.08

Net profit after tax and after extraordinary items 416.03 956.82

Company Performance

During the year under report, your Company has achieved a turnover of Rs. 80,194.27 lakhs (previous year Rs. 87,173.97 lakhs). The operations have resulted in a net profit of Rs. 416.03 lakhs (previous year Rs. 956.82 lakhs).

Industry Outlook

The market for your company products remains subdued. The present manufacturing capacity in India is in far excess of the existing demand. This has lead to very aggressive competition and subsequent negative pressure on the prices of products. Your Company has taken several steps to mitigate the impact of this by taking several measures for optimizing the capacity utilization market reach and performance.

Dividend

In order to conserve resources for Company''s growth, your Directors do not propose to declare any dividend for the year under report. The Company has not transferred any amount to its General Reserve.

Subsidiary- Kirsons B.V.

The operations of Kirsons B.V. your subsidiary have resulted in net loss of € 1.04 lakhs (Previous year € 0.71 lakhs).

Subsidiary Companies

The Company as of March 31, 2013 had one subsidiary, viz., Kirsons B.V., Netherlands (Kirsons). Kirsons is having two subsidiaries - Lloyd Dynamowerke GmbH & Co. KG, Germany and Lloyd Beteiligungs-GmbH, Germany. Pursuant to section 212 of the Companies Act, the annual accounts of subsidiary companies for the year ended 31st March, 2013 along with the statements referred to in the said section, are attached with Consolidated Financial Statements as required.

Lloyd Dynamowerke GmbH & Co. KG, Germany (LDW)

As you are aware, your Company holds 94.89% shares in Lloyd Dynamowerke GmbH & Co. KG, Germany and the entire shareholding in Lloyd Beteiligungs-GmbH, Germany through its subsidiary in The Netherlands - Kirsons B.V. Lloyd Dynamowerke GmbH & Co. KG, Germany is a limited partnership existing in accordance with the Laws of Germany which owns an electrical machine manufacturing plant at Bremen. During the year ended 31st March, 2013 Lloyd Dynamowerke GmbH &Co. KG, had turnover of € 399.57 lakhs (Rs. 27,942 lakhs) {Previous year € 333.33 lakhs (Rs. 22,066 lakhs)} with a net loss after tax of € 64.60 lakhs (Rs. 4,496 lakhs) {Previous year net loss € 5.50 lakhs (Rs. 311 lakhs)}.

Rotating Machines Group

During the year under review the sales under Rotating Machines Group amounted to Rs. 69,935.88 lakhs as against Rs. 63,566.02 lakhs in 2011-12.

Power Generation and Distribution Group

During the year under review the sales under Power Generation and Distribution Group amounted to Rs. 40,861.21 lakhs as against Rs. 46,369.66 lakhs in 2011-12.

Others

During the year under review the sale of other Electrical Products amounted to Rs. 4,719.32 lakhs as against Rs. 6,916.69 lakhs in 2011 -12.

Human Resources

The Company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the Company and the Board puts on record the sincere appreciation of their dedication and loyalty. The Company focuses on building an organization through induction and development of talent to meet current and future needs. Various HR initiatives have been taken to align the HR Policies of the Company with the growth projections of the Company. The Company has 1742 employees as on 31.03.2013.

Environment, Safety and Energy Conservation

As required by the Companies (Disclosure of particulars in the Report of Directors) Rules, 1988, the relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure to this report.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of specified employees are set out in the Annexure to the Directors Report. However having regard to the provisions of section 219(1 )(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all members of the Company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company.

Corporate Governance

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following:

1. Management Discussion and Analysis Report

2. Report on Corporate Governance

3. Auditors Certificate regarding compliance of conditions of Corporate Governance

4. CEO & CFO Certificate

5. CEO Certificate regarding compliance with the Code of Conduct. These annexures form part of this report.

Directors

Mr. Anil Kumar Bhandari Mr. V.P.Mahendra and Mr.Kamlesh Gandhi, Directors retire by rotation at the ensuing Annual General Meeting and are eligible for re-appointment.

The Board has appointed Mr. Ram J Shahaney as Additional Director of the Company at their meeting held on 9th August, 2012. Mr. Ram J Shahaney hold office upto the date of the Annual General Meeting and has been proposed for appointment.

The Board of Directors appointed Mr.Alok Kumar Gupta as the Joint Managing Director of the Company at their Board Meeting held on 8th February, 2013. Mr. Alok Kumar Gupta has assumed the office on 15th March, 2013. The remuneration of Mr. Alok Kumar Gupta has been approved by the Remuneration & Compensation Committee.

Mr. Anuj Pattanaik, Deputy Managing Director, resigned from the services of the Company during the year under review. Your Directors place on record their appreciation of the valuable services rendered by Mr. Pattanaik during his tenure as a Director of the Company.

Mr.D.Devender Singh and Mr. Berthold Groeneveld, resigned as Directors of the Company. Your Directors place on record their appreciation of the valuable services rendered by Mr.D.Devender Singh and Mr. Berthold Groeneveld during their tenure as Directors of the Company.

Directors'' Responsibility Statement

Pursuant to the Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been generally followed.

2. Appropriate accounting policies have been selected and applied consistently and Directors have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the Profit and Loss Account for the year ended 31st March, 2013.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The annual accounts have been prepared on a going concern basis.

Auditors

M/s. B. K. Ramadhyani & Co., Chartered Accountants and M/s. Sundar & Associates, Chartered Accountants, are the retiring Auditors in India and Malaysia respectively. They are eligible for re-appointment. The required certificates to the effect that the re-appointments, if made, will be within the limit specified in Section 224(1 B) of the Companies Act, have been received from M/s. B. K. Ramadhyani &Co., and M/s. Sundar & Associates.

Auditor''s Report

The comments/observations of the Auditors are self-explanatory and the Company''s explanations thereto have been given in relevant notes in the Notes to Accounts. Further explanations in regard to the reservations/qualifications in the Auditors Report are furnished below:

Para (i) of Basis of Qualified Opinion of Auditors

The Company has sought written confirmation from all its vendors to let us know if they are either micro, small or medium enterprises. Once these details are updated, particulars of dues to micro, small and medium enterprises could be ascertained. This is a continuous process and the management would intensify its efforts to collect the required details.

Para (ii) of Basis of Qualified Opinion of Auditors and Para 4 of the Annexure to the Auditors Report

Confirmation is ongoing process. The Company has initiated certain actions to approach these parties and to get the written confirmations.

However it has no impact on financial results of the Company.

Para (NO of Basis of Qualified Opinion of Auditors and Para 2(e) of Auditors'' Report on Other Legal and Regulatory Requirements and Para 4 of the Annexure to the Auditors'' Report

The relevant details of inventory are available for verification .The Company has made good progress in this subject and initiated several actions to address this observation. The Company regularly undertakes physical verification of inventory at all the locations & differences, if any, identified are suitably adjusted in the books. The majority of inputs used by the Company do have long shelf life and the Company is of the opinion that such inputs, if in inventory, are useable. The company will continue with its efforts to bring in the necessary changes so that the valuation of work in progress is in line with Accounting Standard 2, however it has no impact on financial results of the Company.

Para (iv) of Basis of Qualified Opinion of Auditors

The Company has used and relied upon its market intelligence to judge the realizable value of assets held for sale. The estimated realizable value is judged to be in line with the market valuation.

Para 2(a) of the Annexure to the Auditors'' Report

Confirmations have been received from some parties and from some they are expected. This is a continuous process and the management would intensify its efforts to collect the required details.

Para 2 (c) and Para 8 of the Annexure to the Auditors'' Report

During the year, the Company has completed implementation of SAP ECC 6 System at the remaining units. SAP is an integrated software where all the inventory records are maintained. The Company has from time to time taken physical inventory at all locations. Since the valuation of inventory was done on the basis of physical inventory count performed as on 31 st March, 2013, the discrepancies, if any, have been properly dealt with in the books of accounts. The discrepancies were not material in nature.

Fixed Deposits

26 persons had not claimed repayment of their matured deposits amounting to Rs. 22.80 lakhs as at 31st March, 2013. Out of the above upto the date of this report, 10 Fixed Deposit amounting to Rs. 9 lakhs has been repaid and Fixed Deposit amounting to Rs. 8.60 lakhs has been renewed and balance 8 Fixed Deposit amounting to Rs. 5.2 lakhs had not been claimed.

Acknowledgements

The Board of Directors take this opportunity to express its sincere appreciation for the continued support and confidence received from the Company''s Bankers, Financial Institutions, Customers, Suppliers, Depositors, Shareholders and Employees.

For and on behalf of the Board of Directors

Place: Bangalore Vijay R Kirloskar

Date : September 2, 2013 Chairman & Managing Director

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Mar 31, 2012

The Directors present the Company's 65th Annual Report with the Audited Balance Sheet as at 31st March, 2012 and Profit and Loss Account for the year ended 31st March, 2012.

Results of Operations Rs in Million

2011-12 2010-11

Income 8717.4 8238.7

Expenditure 6558.6 6330.9

Gross Profit 2158.8 1907.8

Operating expenses 1548.6 1444.4

Operating Profit before interest and depreciation 610.2 463.4

Interest 383.0 317.1

Depreciation, amortisation and provisions 183.9 161.9

Operating profit before tax and extraordinary items 43.3 (15.6)

Other income (net) 57.6 36.9

Net profit before tax and extraordinary items 100.9 21.3

Extraordinary Income (Expenditure)

Net profit before tax and after extraordinary items 100.9 21.3

Provision for taxation 5.2 0.2

Net profit after tax and after extraordinary items 95.7 21.1

Company Performance

During the year under report, your Company has achieved a turnover (Gross) of Rs. 8.72 billion (previous year Rs. 8.24 billion). The operations have resulted in a net profit of Rs.95.7 million (previous year Rs. 21.1 million).

Industry Outlook

Indian Economy performed relatively well against the backdrop of weak global atmosphere. Global economies appear to be going through a phase which is having greater share of volatility than that of stability. There are signs of inertia in Indian Economy as well. Your Company has taken several steps to mitigate the impact of this, rather to have better results by stress upon actions oriented towards goals and performance which should enable the Company to do well, barring unforeseen circumstances.

Appropriations

Dividend

In order to conserve resources for Company's growth, your Directors regret their inability to declare any dividend for the year under report. The Company has not transferred any amount to its General Reserve.

Subsidiary - Kirsons B.V.

The operations of Kirsons B.V.,your subsidiary have resulted in net loss of Euro 0.071million.

Subsidiary Companies

The Company as of March 31, 2012 had one subsidiary, viz., Kirsons B.V., Netherlands (Kirsons). Kirsons is having two subsidiaries - Lloyd Dynamowerke GmbH & Co. KG, Germany and Lloyd Beteiligungs-GmbH, Germany. Pursuant to section 212 of the Companies Act, the annual accounts of subsidiary companies for the year ended 31st March, 2012 along with the statements referred to in the said section, are attached with Consolidated Financial Statements as required. Further, pursuant to Accounting Standard - 21 (AS-21) prescribed under the Companies (Accounting Standard) Rules, 2006, Consolidated Financial Statement presented by the Company includes financial information about its subsidiaries.

Environment, Safety and Energy Conservation

As required by the Companies (Disclosure of particulars in the Report of Directors) Rules, 1988, the relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure to this report.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of specified employees are set out in the Annexure to the Directors Report. However having regard to the provisions of section 219(1 )(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all members of the Company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company.

Corporate Governance

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following :

1. Management Discussion and Analysis Report

2. Report on Corporate Governance

3. Auditors Certificate regarding compliance of conditions of Corporate Governance

4. CEO & CFO Certificate

5. CEO Certificate regarding compliance with the Code of Conduct.

These annexures form part of this report.

Directors

Mr.Berthold Groeneveld, Mr. D.Devender Singh and Mrs.Meena Kirloskar retire by rotation and being eligible offer themselves for re-appointment. Directors' Responsibility Statement

Pursuant to the Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that :

1. In the preparation of the annual accounts, the applicable accounting standards have been generally followed.

2. Appropriate accounting policies have been selected and applied consistently and Directors have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2012 and of the Profit and Loss Account for the year ended 31st March, 2012.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The annual accounts have been prepared on a going concern basis.

Human Resources

The Company considers its employees as its most valuable asset. Employees at all levels have put in their best to the services of the Company and the Board puts on record the sincere appreciation of their dedication and loyalty. The Company focuses on building an organization through induction and development of talent to meet current and future needs. Various HR initiatives have been taken to align the HR Policies of the Company with the growth projections of the Company.

Segmentwise Operational Performance Rotating Machines Group

During the year under review the sales under Rotating Machines Group amounted to Rs. 6356.60 million as against Rs. 6401.65 million in 2010-11.

Power Generation and Distribution Group

During the year under review the sales under Power Generation and Distribution Group amounted to Rs. 4636.97 million as against Rs. 4646.76 million in 2010-11.

Others

During the year under review the sale of other Electrical Products amounted to Rs.691.67 million as against Rs. 535.90 million in 2010-11. Lloyd Dynamowerke GmbH & Co. KG, Germany (LDW)

As you are aware the Company holds approximately 95% stake in Lloyd Dynamowerke GmbH & Co. KG, Germany and the entire shareholding in Lloyd Beteiligungs-GmbH, Germany through its subsidiary in The Netherlands - Kirsons B.V. Lloyd Dynamowerke GmbH & Co. KG, Germany is a limited partnership existing in accordance with the laws of Germany which owns an electrical machine manufacturing plant at Bremen, which is being operated by the said limited liability firm. During the year ended 31st March, 2012 Lloyd Dynamowerke GmbH & Co. KG, had turnover of Euros 33.333 ( Rs.222 crores ){ Previous year -Euros 43.509 million (Rs.263 crores)} with a net loss after tax of Euros 0.550 million ( Rs.3.10 crores ) {Previous year net profit Euros 1.270 million (Rs.9.06 crores)}.

AUDITORS' REPORT

The comments/observations of the Auditors are self-explanatory and the Company's explanations thereto have been given in relevant notes in the Notes to Accounts. Further explanations in regard to the reservations/qualifications in the Auditors Report are furnished below :-

Para 10(i) of the Auditors' Report

The Company has sought written confirmation from all its vendors to let us know if they are either micro, small or medium enterprises. Once these details are updated, particulars of dues to micro, small and medium enterprises could be ascertained.

Para 10 (ii) of the Auditors' Report

Confirmations have been received from some parties and from some they are expected. Confirmation is an ongoing process. However, this has no impact on financial results of the Company.

Para 8 and Para 10 (iii) of the Auditors' Report.

This has no impact on the accounts. The Company has complied with Accounting Standard 2 in respect of valuation of raw materials, stores and components and in respect of work in progress and finished goods. The Company has from time to time initiated steps to bring the valuation of inventory at all units in line with Accounting Standard -2 (Valuation of Inventory). The relevant details of inventory are available for verification.

Para 10 (iv) of the Auditors' Report.

The Company has used and relied upon its market intelligence to judge the realizable value of assets held for sale. The estimated realizable value is judged to be in line with the market valuation.

Para 10 (v) of the Auditors' Report

The Company is confident of realising the amounts due from certain companies referred to therein.

Para 2 a of the Annexure to the Auditors' Report

Confirmations have been received from some parties and from some they are expected. Confirmation is an ongoing process.

Para 2 b of the Annexure to the Auditors' Report

The Company has already identified the key focus areas and has started taking the necessary steps to make the inventory verification reasonable and adequate.

Para 2 c and Para 8 of the Annexure to the Auditors' Report

During the year, the Company has completed implementation of SAP ECC 6 System at certain units and it will implement it at the remaining units in phased manner in the current year. SAP is an integrated software where all the inventory records are maintained. The company has from time to time taken physical inventory at all locations. Since the valuation of inventory was done on the basis of physical inventory count performed as at 31st March 2012, the discrepancies, if any, have been properly dealt with in the books of accounts. The discrepancies were not material in nature.

Para 5 a of the Annexure to the Auditors' Report

The Company is in the process of applying to the Central Government to seek its approval in respect of these contracts.

Para 7 of the Annexure to the Auditors' Report

The Company appointed an independent reputed professional agency to perform internal audit of operations of the Company. The scope of the internal audit is decided considering the risk assessment carried out by the Company. The internal audit work at several of its plants, branches and offices are at advanced stage of completion and the final report is expected soon.

Para 9 b of the Annexure to the Auditors' Report

The Company has made necessary arrangements to pay these dues.

Auditors

M/s. B. K. Ramadhyani & Co., Chartered Accountants and M/s. Sundar & Associates, Chartered Accountants, are the retiring Auditors in India and Malaysia respectively. They are eligible for re-appointment. The required certificates to the effect that the re-appointments, if made, will be within the limit specified in Section 224(1-B) of the Companies Act, have been received from M/s. B. K. Ramadhyani & Co., and M/s. Sundar & Associates.

Fixed Deposits

12 persons had not claimed repayment of their matured deposits amounting to Rs.5.94 lakhs as at 31st March, 2012.

Acknowledgements

The Directors takes this opportunity to express its sincere appreciation for the continued support and confidence received from the Company's Bankers, Financial Institutions, Customers, Suppliers, Depositors and Shareholders. Your Directors place on record their appreciation of the efforts of employees at all levels and look forward to their continued support in the future as well.

For and on behalf of the Board of Directors,

Bangalore Vijay R Kirloskar

Date : May 28, 2012 Chairman

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Mar 31, 2011

The Shareholders

The Directors present the Company's 64th Annual Report with the Audited Balance Sheet as at 31st March, 2011 and Profit and Loss Account for the year ended 31st March, 2011.

Results of Operations Rs. in miliion

2010-11 2009-10

Income 8238.7 8407.3

Expenditure 6330.9 6151.3

Gross Profit 1907.8 2256.0

Operating expenses 1482.3 1499.7

Operating Profit before interest and depreciation 425.5 756.3

Interest 257.6 225.7

Depreciation, amortisation and provisions 182.5 175.6

Operating profit before tax and extraordinary items (14.6) 355.0

Other income (net) 36.9 119.5

Net profit before tax and extraordinary items 22.3 474.5

Extraordinary Income (Expenditure) (1) 6.4

Net profit before tax and after extraordinary items 21.3 480.9

Provision for taxation 0.2 105.0

Net profit after tax and after extraordinary items 21.1 375.9

Company Performance

During the year under report, your Company has achieved a turnover (Gross) of Rs. 8.24 billion (previous year Rs. 8.41 billion). The operations have resulted in a net profit of Rs. 21.1 million (previous year Rs. 375.9 million).

Industry Outlook

The Electrical Industry has been witnessing consistent growth during last few years but for a lull during 2008-09 on account of worldwide recession, which affected all industries. The performance of the industry is directly related to the country's GDP growth. If the monsoon is good, forecast for which is "normal", the Electrical Industry should perform well in 2011-12 also.

Appropriations

Dividend

In order to conserve resources for Company's growth, your Directors regret their inability to declare any dividend for the year under report. The Company has not transferred any amount to its General Reserve.

Subsidiary - Kirsons B.V.

The operations of Kirsons B.V.,your subsidiary have resulted in net profit of Euro 3.947 million after accounting for profits of its subsidiaries.

Subsidiary Companies

The Company as of March 31, 2011 had one subsidiary, viz., Kirsons B.V., Netherlands (Kirsons). Kirsons is having two subsidiaries - Lloyd Dynamowerke GmbH & Co. KG, Germany and Lloyd Beteiligungs-GmbH, Germany. Pursuant to section 212 of the Companies Act, the annual accounts of subsidiary companies for the year ended 31st March, 2011 along with the statements referred to in the said section, are attached with Consolidated Financial Statements as required. Further, pursuant to Accounting Standard - 21 (AS-21) prescribed under the Companies (Accounting Standard) Rules, 2006, Consolidated Financial Statement presented by the Company includes financial information about its subsidiaries.

Environment, Safety and Energy Conservation

As required by the Companies (Disclosure of particulars in the Report of Directors) Rules, 1988, the relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure to this report.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of specified employees are set out in the Annexure to the Directors Report. However having regard to the provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the Annual Report is being sent to all members of the Company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company.

Corporate Governance

Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following :

1. Management Discussion and Analysis Report

2. Report on Corporate Governance

3. Auditors Certificate regarding compliance of conditions of Corporate Governance

4. CEO & CFO Certificate

5. CEO Certificate regarding compliance with the Code of Conduct. These annexures form part of this report.

Directors

Mr.A.S.Lakshmanan, Mr. S.N.Agarwal and Mr.Sarosh J Ghandy retire by rotation and being eligible offer themselves for re-appointment.

The Board of Directors have at their meeting held on 23rd September, 2010 appointed Mr.Anuj Pattanaik as additional director and have also appointed him as Deputy Managing Director for a period of five years from 23.9.2010, subject to approval of shareholders and such other approvals as may be required.

Mr.Anuj Pattanik is a B.Tech in Mettalurgical Engineering from Indian Institute of Technology, Kanpur with rich experience of over three decades of working with well known national and international organizations.

Mr.P.S.Malik, Joint Managing Director, retired from the services of the Company during the year under review, after over 13 years of service in the Company. Your Directors place on record their appreciation of the valuable services rendered by Mr.Malik during his tenure as a Director of the Company.

Directors' Responsibility Statement

Pursuant to the Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards have been generally followed.

2. Appropriate accounting policies have been selected and applied consistently and they have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31s' March, 2011 and of the Profit and Loss Account for the year ended 31st March, 2011.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other Irregularities.

4. The annual accounts have been prepared on a going concern basis.

Human Resources

Employees at all levels have put in their best to the services of the Company and the Board puts on record the sincere appreciation of their dedication and loyalty. The Company considers its employees as its most valuable asset. The Company focuses on building an organization through induction and development of talent to meet current and future needs. Various HR initiatives have been taken to align the HR Policies of the Company with the growth projections of the Company.

Mr.R.K.Gupta, CFO, left the services of the Company during the year under review for personal reasons, after a long distinguished service.

Segmentwise Operational Performance Rotating Machines Group

During the year under review the sales under Rotating Machines Group amounted to Rs. 6401.65 million as against Rs. 7536.26 million in 2009-10.

Power Generation and Distribution Group

During the year under review the sales under Power Generation and Distribution Group amounted to Rs. 4646.76 million as against Rs. 4496.14 million in 2009-10.

Others

During the year under review the sale of other Electrical Products amounted to Rs. 535.90 million as against Rs. 444.49 million in 2009-10.

Lloyd Dynamowerke GmbH & Co. KG, Germany (LDW)

As you are aware the Company holds approximately 95% stake in Lloyd Dynamowerke GmbH & Co. KG, Germany and the entire shareholding in Lloyd Beteiligungs-GmbH, Germany through its subsidiary in The Netherlands - Kirsons B.V. Lloyd Dynamowerke GmbH & Co. KG, Germany is a limited partnership existing in accordance with the laws of Germany which owns an electrical machine manufacturing plant aKBremen, which is being operated by the said limited liability firm. During the year ended 31s' March, 2011 Lloyd Dynamowerke GmbH & Co. KG, had turnover of Euros 43.509 million ( Rs. 263 crores ) with a net profit after tax of Euros 1.270 Million (Rs. 9.06 crores).

Auditors' Report

The comments/observations of the Auditors are self-explanatory and the Company's explanations thereto have been given in relevant notes in the Notes to Accounts. Further explanations in regard to the reservations/qualifications in the Auditors Report are furnished below :-

Para 10 (i) of the Auditors Report and Para 4 of the Annexure to the Auditors Report

Confirmations have been received from some parties and from some they are expected. Confirmation is ongoing process. However, this has no impact on financial results of the Company.

Para 8 and Para 10 (ii) of the Auditors Report

This has no impact on the accounts. The Company has complied with Accounting Standard 2 in respect of valuation of raw materials, stores and components and in respect of work in progress and finished goods. The Company has from time to time initiated steps to bring the valuation of inventory at all units in line with Accounting Standard-2 (Valuation of Inventory).

Para 10 (iii) of the Auditors Report

The Company has used and relied upon its internal market intelligence to estimate the realizable value of assets held for sale. The estimated realizable value is judged to be in line with the market valuation.

Para 10 (iv) of the Auditors Report

The Company is confident of realising the amounts due from certain companies referred to therein.

Para 2 a of the Annexure to the Auditors' Report

Confirmations have been received from some parties and from some they are expected. Confirmation is an ongoing process.

Para 2 b of the Annexure to the Auditors' Report

The Company has already identified the key focus areas and has started taking the necessary steps to make the inventory verification reasonable and adequate.

Para 2 c and Para 8 of the Annexure to the Auditors Report

During the year, the Company has completed implementation of SAP ECC 6 System at certain units and it will implement it at the remaining units in phased manner in the current year. SAP is an integrated software where all the inventory records are maintained. The Company has from time to time taken physical inventory at all locations. Since the valuation of inventory was done on the basis of physical inventory count performed as at 31st March 2011, the discrepancies, if any, have been properly dealt with in the books of accounts. The discrepancies were not material in nature.

Para 7 of the Annexure to the Auditors' Report

The Company has started the initiatives to strengthen the internal audit system to make it commensurate with the size and nature of its business.

Para 9 b of the Annexure to the Auditors' Report

The Company has made necessary arrangements to pay these dues.

Auditors

M/s. B. K. Ramadhyani & Co., Chartered Accountants and M/s. Sundar & Associates, Chartered Accountants, are the retiring Auditors in India and Malaysia respectively. They are eligible for re-appointment. The required certificates to the effect that the re-appointments, if made, will be within the limit specified in Section 224(1-B) of the Companies Act, have been received from M/s. B. K. Ramadhyani & Co., and M/s. Sundar & Associates.

Fixed Deposits

7 persons had not claimed repayment of their matured deposits amounting to Rs.. 2.44 lakhs as at 31s' March, 2011.

Acknowledgements

The Directors place on record their appreciation of efforts of employees at all levels. They would like to place on record their sincere appreciation for the continued co-operation and support provided by the Bankers, Financial Institutions, Customers, Suppliers, Depositors and Shareholders.

For and on behalf of the Board of Directors,

Bangalore Vijay R Kirloskar

Date : May 28, 2011 Chairman

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Mar 31, 2010

The Directors present the Companys 63rd Annual Report with the Audited Balance Sheet as at 31st March, 2010 and Profit and Loss Account for the year ended 31st March, 2010.

Results of Operations

Rs. in million

2009-10 2008-09

Income 8407.3 8666.6

Expenditure 6151.3 6674.9

Gross Profit 2256.0 1991.7

Operating expenses 1499.7 1340.2

Operating Profit before interest and depreciation 756.3 651.5

Interest 225.7 225.3

Depreciation, amortisation and provisions 175.6 165.1

Operating profit before tax and extraordinary items 355.0 261.1

Other income (net) 119.5 87.4

Net profit before tax and extraordinary items 474.5 348.5

Extraordinary Income(Expenditure) 6.4 0

Net profit before tax and after extraordinary items 480.9 348.5

Provision for taxation 105.0 46.4

Net profit after tax and after extraordinary items 375.9 302.1



Company Performance

During the year under report, your Company has achieved a turnover (Gross) of Rs.9.05 billion (previous year Rs. 9.63 billion. The operations have resulted in a net profit of Rs. 375.93 million (previous year Rs. 302.12 million).

Industry Outlook

The Electrical Industry has been witnessing consistent growth during last few years but for rather dull performance during 2008-09 on account of worldwide recession, which affected all industries. The performance of the industry is directly related to the countrys GDP growth. If the monsoon is good and the industrial revival is sustained, the Electrical Industry can perform well.

Appropriations

Dividend

In order to conserve resources for Companys growth, your Directors regret their inability to declare any dividend for the year under report. The Company has not transferred any amount to its General Reserve.

Subsidiary - Kirsons B.V.

Kirsons B.V.,your subsidiary has achieved a turnover of Euro 0.93 lakhs. The operations have resulted in net loss of Euro 3.51 lakhs.

Subsidiary Companies

The Company as of March 31, 2010 had one subsidiary, viz., Kirsons B.V., Netherlands (Kirsons). Kirsons is having two subsidiaries - Lloyd Dynamowerke GmbH & Co. KG, Germany and Lloyd Beteiligungs-GmbH, Germany. Pursuant to section 212 of the Companies Act, the annual accounts of subsidiary companies for the year ended 31st March, 2010 along with the statements referred to in the said section, are attached with Consolidated Financial Statements as required. Further, pursuant to Accounting Standard - 21 (AS-21) prescribed under the Companies (Accounting Standard) Rules, 2006, Consolidated Financial Statement presented by the Company include financial information about its subsidiaries.

Environment, Safety and Energy Conservation

As required by the Companies (Disclosure of particulars in the Report of Directors) Rules, 1988, the relevant data pertaining to conservation of energy, technology absorption and other details are given in the Annexure to this report.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, the names and other particulars of specified employees are set out in the Annexure to the Directors Report. However, having regard to the provisions of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Annual Report is being sent to all members of the Company, excluding the aforesaid information. Any member interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company.Corporate Governance Pursuant to the requirements of the Listing Agreements with Stock Exchanges, your Directors are pleased to annex the following :

1. Management Discussion and Analysis Report

2. Report on Corporate Governance

3. Auditors Certificate regarding compliance of conditions of Corporate Governance

4. CEO & CFO Certificate

5. CEO Certificate regarding compliance with the Code of Conduct. These annexures form part of this report.

Directors

Mr.V.P.Mahendra, Mr. Kamlesh Gandhi and Mr.Anil Kumar Bhandari retire by rotation and being eligible offer themselves for reappointment.

The Board of Directors have at their meeting held on 10th July, 2010 re-appointed Mr.Vijay R Kirloskar as Managing Director for a period of five years from 17.8.2010, subject to approval of shareholders and such other approvals as may be required.

Directors Responsibility Statement

Pursuant to the Section 217 (2AA) of the Companies Act, 1956, the Directors confirm that :

1. In the preparation of the annual accounts, the applicable accounting standards have been generally followed.

2. Appropriate accounting policies have been selected and applied consistently and they have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and of the Profit and Loss Account for the year ended 31st March, 2010.

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The annual accounts have been prepared on a going concern basis.

Human Resources

The Company considers its employees as its most valuable asset. The Company focuses on building an organization through induction and development of talent to meet current and future needs. Various HR initiatives have been taken to align the HR Policies of the Company with the growth projections of the Company.

Segmentwise Operational Performance

Rotating Machine Group

During the year under review the sales under Rotating Machine Group amounted to Rs. 7536.26 million as against Rs. 6436.84 million.

Power Generation Equipment Group

During the year under review the sales under Power Generation Equipment Group amounted to Rs. 4496.14 million as against Rs. 4933.07 million.

Others

During the year under review the sale of other Electrical Products amounted to Rs. 444.49 million as against Rs. 510.13 million.

Lloyd Dynamowerke GmbH & Co. KG, Germany (LDW)

As you are aware the Company holds approximately 95% stake in Lloyd Dynamowerke GmbH & Co. KG, Germany and the entire shareholdings in Lloyd Beteiligungs-GmbH, Germany through its subsidiary in The Netherlands – Kirsons B.V. Lloyd Dynamowerke GmbH & Co. KG, Germany is a limited partnership existing in accordance with the laws of Germany which owns an electrical machine manufacturing plant at Bremen, which is being operated by the said limited liability firm. During the year ended 31st March, 2010 Lloyd Dynamowerke GmbH & Co. KG, had turnover of Euros 50.83 million with a net profit after tax of Euros 1.91 Million.

Auditors Report

The comments/observations of the Auditors are self-explanatory and the Company’s explanations thereto have been given in relevant notes in the Notes to Accounts. Further explanations in regard to the reservations/qualifications in the Auditors Report are furnished below:- Para 8 of the Auditors Report, Para 2 c and 8 of the Annexure to the Auditors Report.

The Company has implemented MYSAP ECC 6.0 in all the major manufacturing units and rest will be covered in phased manner . SAP is an integrated software where all the inventory records will be maintained and the valuation configured in SAP is in line with Accounting Standard –2 (Valuation of Inventory) by this we will be complying with Accounting Standard –2. However, this has no impact on the accounts.

Para 10 (i) of the Auditors Report and 4 of the Annexure to the Auditors Report

Confirmation have been received from some parties and from some they are expected. Confirmation is ongoing process. However, this

has no impact on financial results of the Company.

Para 10 (ii) of the Auditors Report

The Company has complied with Accounting Standard 2 in respect of valuation of raw materials, stores and components and in respect of work in progress and finished goods. The Company has initiated steps to bring the valuation of work in progress and finished goods at all units in line with Accounting Standard –2 (Valuation of Inventory). However, this has no impact on the accounts.

Para 10 (iii) of the Auditors Report

As mentioned in Note 26 b) the Company is confident of realising the amounts due from certain companies referred to therein.

Para 2 a of the Annexure to the Auditors Report

Confirmation have been received from some parties and from some they are expected. Confirmation is an ongoing process.

Auditors

M/s. B. K. Ramadhyani & Co., Chartered Accountants M/s. Sundar & Associates, Chartered Accountants, are the retiring Auditors in India and Malaysia respectively. They are eligible for re-appointment. The required certificates to the effect that the re-appointments, if made, will be within the limit specified in Section 224(1-B) of the Companies Act, have been received from M/s. B. K. Ramadhyani & Co., and M/s. Sundar & Associates.

Fixed Deposits

7 persons had not claimed repayment of their matured deposits amounting to Rs. 2.44 lakhs as at 31st March, 2010.

Acknowledgements

The Directors place on record their appreciation of efforts of employees at all levels. They would like to place on record their sincere appreciation for the continued co-operation and support provided by the Bankers, Financial Institutions, Customers, Suppliers, Depositors and Shareholders.

For and on behalf of the Board of Directors,

Bangalore Vijay R Kirloskar

Date : 10th July, 2010 Chairman