Panasonic Energy India Company Ltd

Dear Shareholders,

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Your Directors have great pleasure to report you at the end of another challenging year, and presenting the 53 annual report together with the audited financial statements for the year ended March 31, 2025.

1. Financial Result Summary

2. Transfer to Reserve

The Company does not propose to transfer any amount to the general reserve out of the amount available for appropriation.

3. Dividend

Keeping in view the current pro tability of the Company, your Directors are pleased to recommend payment of dividend of INR 9.42 per equity share (@ 94.20% at par value of INR 10.00 each) (Previous Year- INR 8.85 per equity share (@ 88.50% at par value of INR 10.00 each), subject to the approval of shareholders at the forthcoming Annual General Meeting. The dividend, when approved, will entail payment to shareholders of INR 706.50 lakhs. It will be tax free income in the hands of recipients till the amount of dividend does not exceed INR 5,000.00.

4. Operational Review & State of Company's Affairs

The financial year 2024 2025 was noteworthy in terms of many aspects. This year, we set out to optimize the process and retain pro tability. In an attempt to gain market share, the competitors expended the distribution of super-economy SKUs, but we aimed to have a healthy product mix and were still able to achieve growth that was on level with the industry.

The financial gures show a degrowth since we supplied a special order of alkaline batteries to ECIL for polling machines last year.

In the above situation during the year, your Company registered net sales amount of INR 26,841.47 lakhs as against INR 29,242.13 lakhs of the previous year.

Pro t before tax stood at INR 1,769.53 lakhs as compared to INR 1,547.49 lakhs.

Dry Batteries:

The usage pattern of dry battery is witnessing changing lifestyle of Indian consumer. Decreasing contribution of D size batteries indicates the stability of power supply. However, demand of D size category is supported by increasing use of other appliances like Gas Geysers. No major change observed in AA size batteries demand.

The demand of AAA category is growing, which indicates increasing usage of remote-controlled applications such as air-conditioners, Tv's etc.

Prospects

The market of zinc carbon dry batteries seems to be promising in the upcoming years due to the growing use of remote-controlled household appliances, the entry of new edge gadgets, increasing demand of health monitoring devices, and the steady need for wall clocks, ashlights & Toys.

5. Change in Nature of Business

As reported last year, there is no material change in the business.

6. Product Pro le

The company maintained its stance of offering a extensive range of high performance batteries to serve India's portable energy need. Zinc carbon batteries continue to dominate the market since they are compatible with most Indian appliances.

In the face of urbanization and the growing use of contemporary devices, alkaline and lithium coin batteries are showcasing encouraging growth.

7. Management Discussion and Analysis Business Overview

With a large youth population and one of the fastest growing major economies in the world, India has kept up its pace in battery demand for FY 2024 2025.

Zinc Carbon batteries

The Indian battery market is dominated by the zinc carbon category. In zinc carbon category, the company's market share is continuously growing. This year too, company growth is better than industry in the zinc carbon segment. However, there is no remarkable gain visible in market share because the pace could not be continued in Q4, as we strategically decided not to trade down.

Alkaline batteries

Alkaline batteries contribution has been increasing for the past several years, however, the demand for this segment is mainly driven by low grade alkaline. We offer our premium range of alkaline batteries under the EVOLTA brand. The industry's move from premium alkaline to low grade alkaline restricted growth of EVOLTA batteries.

Rechargeable batteries

The rechargeable battery market contributes around 1% to total battery demand.

This segment is dominated by imported low priced rechargeable batteries.

Your Company has successfully marked its presence in marketing and sales of high quality "eneloop" brand of rechargeable batteries and chargers.

Dealers and consumers appreciate the quality and superiority of our rechargeable batteries. Your Company maintained its dominance and market share in this category.

Lithium coin batteries

The demand of Lithium coin batteries has been increasing in India. The demand for this segment is driven by rising awareness of health monitoring devices and increasing use of car key fobs.

Your company offers the widest product range in this segment to meet customer demands, and we are achieving notable growth every year. Panasonic Lithium coin batteries are known for it's high performance in car key fobs

Industry Structure and Development

In the approaching years, the Indian battery market anticipates a greater growth in AAA sized batteries due to the rise in air conditioners and remote controlled devices. In the years to come, the growth of the coin and alkaline divisions is anticipated to pick up speed. Rechargeable batteries do not contribute much though.

Marketing and Distribution

The company is making great efforts to maximize its distribution and improve coverage. We quickly and effectively implemented the SFA system this year to optimize sales and distribution. In addition to aiming to boost individual productivity, Panasonic's objective as a battery expert is to educate Indian consumers about their battery needs and provide a large selection of high-performance, environmentally friendly batteries that are perfect t for their devices.

Opportunities and threats

Opportunities

The per capita consumption of batteries in urban areas is increasing with addition in number of gadgets per household and changing lifestyle. The consumption of dry cell battery is expected to grow considering growing Indian economy and increasing purchasing power of average Indian consumer.

As an environmentally conscious company, the implementation of the Battery Waste Management Rules presents a new opportunity for leadership in the circular economy and the creation of additional revenue streams. This initiative will enhance our innovation capabilities and strengthen our alignment with ESG (Environmental, Social, and Governance) principles.

Threats

Low cost imported alkaline batteries are growing their market share in India through extensive promotion. Battery Industry is witnessing trade-down in alkaline as well as CZ segment which is not a good sign for the company.

Long term dif culties may arise due to smartphones' quick rise as control units for connecting appliances. However, remote control continues to be an essential part of day-to-day life.

Risks and Concerns

In FY 2024-25, the company faced several risks and concerns related to procurement activities. Volatility in global supply chains, driven by geopolitical tensions, raw material shortages and uctuating foreign exchange rates, impacted cost structures and procurement planning. Dependence on a limited pool of suppliers heightens exposure to disruptions, while evolving regulatory requirements and ESG (Environmental, Social, and Governance) compliance requirements pressure procurement functions to adapt quickly.

Outlook

The industry has a promising business outlook and great potential for growth, considering the increasing use of battery powered devices. With the support of government policy, India becoming the hotspot for the manufacturing of toys, electronic devices and medical equipment are the key factors for the rapid growth of the market.

Further, alkaline batteries are expected to strengthen enhance their dominance in the primary battery market and continue to witness the fastest growth, primarily due to the increasing per capita income of Indian consumer.

India's purchasing parity per capita income has more than doubled in the last decade and declining cost of consumer electronics and growing population have led to growth of the consumer electronics market in the country, which in turn, is driving the battery industry. Also rising income levels, increasing urbanization, changing lifestyle and enhanced need for convenience is expected to boost battery run gadgets demand.

The battery industry has a promising future but it needs to adapt to changing market trends and environment regulation.

Internal Financial Controls

The Company has an internal financial control system commensurate with the size and scale of its operations. These controls are adequate and operating effectively so as to ensure orderly and efficient conduct of business operations.

The internal staff monitors and evaluates the adequacy of internal control system in the Company, its compliances with operating systems, accounting procedures and policies at all locations of the Company. Based on the reports, the Company undertakes corrective actions, thereby strengthening the controls. Significant observations and corrective actions thereon are presented to the Audit Committee for its review.

Development in the Human Resource and Industrial Relation

The Board wish to place on record its appreciation to all its employees for their sustained efforts and valuable contribution. Your Company is very much concerned for the employees so as to provide them with safe and accident free environment with a motto "Safety First" at the work place. The total employee strength of the Company as on March 31, 2025 stood at 679.

Research & Development

We at, Panasonic Energy India Company Ltd., aim for better quality of human life and preservation of our planet. Recognizing that our Company is a member of society, we are contributing to a healthier and more prosperous community by way of Manufacturing and selling complete range of eco-friendly batteries through elimination of hazardous substances i.e. Lead (Pb), Mercury (Hg), and Cadmium (Cd) etc.

A way forward, the Company is complying to EU directives and controlling the RoHS substance in the Battery Components.

The Company's factory in Pithampur (Madhya Pradesh) is a Carbon Neutral Factory in Dry Battery industries in India and has received a Certificate of Veri cation Carbon Unit (VCU) Retirement Since 2023, additionally, it has been certified by the International REC Standard. The wastewater treatment at the factory results in zero discharge of wastewater and furthermore, 50% of factory land has a forest cultivated by the Company.

Contributing in reduction of CO2 emission through energy conservation means. Implementing 3R concept "Reduce, Re-use and Re-cycle". Our main business objective is Customer First & we always strive to deliver best quality & environmental friendly batteries that offer consistent performance by putting our best efforts through Research & Development and Empowered with Japanese technology.

8. Material changes and Commitments

There is no such material change and commitment, affecting the financial position of the Company which have occurred between the end of the financial year ended on March 31, 2025 and the date of the report.

9. Corporate Governance

As per requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "Listing Regulations") a separate section on corporate governance practices followed by the Company, together with a certificate from the Company Secretary in Practice confirming compliances, forms an integral part of this Report.

10. Annual Return

A copy of Annual Return as required under the Companies Act, 2013 has been placed on the Company's website viz. https://www.panasonicenergyindia.in

11. Board Meetings

Schedules of Board and Committee meetings are prepared and circulated in advance to the Directors. During the year, four Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

12. Directors' Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

(a) that in the preparation of the annual accounts for the year ended March 31, 2025, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(b) that the Directors 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 as at March 31, 2025 and of the profit and loss of the Company for the year ended on March 31, 2025;

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

(d) that the Directors had prepared the annual accounts on a going concern basis;

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

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

13. Contracts and Arrangements with Related Parties

All transactions entered with related parties for the year under review were in the ordinary course of business and on arm's length basis. Further, there are no material related party transactions during the year and thus a disclosure in Form AOC-2 in terms of Section 134 of the Act is not required.

All related party transactions are placed before the Audit Committee for approval. Omnibus approval was obtained on a yearly basis for transactions which are of repetitive nature. The policy on related party transactions as approved by the Board of Directors has been uploaded on the website of the Company viz. https://www.panasonicenergyindia.in

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

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are annexed herewith. (Ref. "Annexure-A")

15. Risk Management

The Company has framed a risk management policy containing the elements of various risks and implementation strategy to mitigate those risks. The risk management framework is reviewed periodically by the Board.

16. Corporate Social Responsibility

During the year under review as part of its initiatives under Corporate Social Responsibility (CSR), the Company has expanded its activities and participated in the projects of plantation of trees in Haryana in the areas of Environment Sustainability undertaken by NGO i.e. Catch Foundation. These projects are in accordance with Schedule VII of the Companies Act, 2013.

During the year, under review Company's obligation towards its CSR Policy, CSR Obligation for the financial year 2024-25 was Rs. 8,44,168.00 and Company spent Rs. 8,44,168.00 on CSR during the FY

2024-25 through implementing agencies operating in the area of Environment Sustainability.

The Annual Report containing details on CSR activities is annexed herewith. (Ref. "Annexure B").

17. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has in place a policy on prevention of sexual harassment in line with there quirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The Management of the Company and female employees, gives training for awareness of the female employees on all applicable provisions of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the FY 2024-25, two meetings of ICC were held on September 20, 2024 and March 25, 2025.

During the year, no complaint was received by the Company and hence, no complaints are outstanding as on March 31, 2025 for redressal. Annual report of nil complaints for the calendar year 2024 was submitted to the respective District Of cer at Vadodara.

18. Annual Evaluation by the Board

The Board has carried out an annual evaluation of its own performance, Committees of the Board and individual Directors pursuant to the provisions of the Companies Act, 2013 and Listing Regulations on February 05, 2025. The Board of Directors expressed their satisfaction with the evaluation process.

19. Vigil Mechanism / Whistle Blower Policy

The Company has established a vigil mechanism for Directors and employees and the same has been communicated to the Directors and employees of the Company. The vigil mechanism policy / whistle blower policy is also posted on the website of the Company.

20. Directors and Key Managerial Personnel

The Company had received declarations from all Independent Directors that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and requirements of Listing Regulations.

Based on the declarations received from the Independent Directors, your Board of Directors con rm the independence, integrity, expertise and experience (including the pro ciency) of the Independent Directors of the Company. Independent Directors comply with the Code of Conduct for Directors, Senior Management & Employees of the Company.

Mr. Hidefumi Fujii will retire by rotation and being eligible, offers himself for re-appointment.

As required by Regulation 36(3) of Listing Regulations, the relevant details in respect of the Directors proposed to be appointed / re-appointed are set out in the Corporate Governance Report forming part of the Board's Report. The Board recommends all the resolutions placed before the members relating to appointment / re-appointment of Directors for their approval.

However, during the year under review:

Shareholders at its 52nd Annual General Meeting held on July 25, 2024 approved :

1) Appointment of Ms. Deepti Sharma (DIN 03630613) as Independent Director for the first term of ve consecutive years commencing from July 25, 2024 up to July 24, 2029.

2) Appointment of Mr. Srinivas Gunta (DIN 10639875) as Independent Director for a first term of ve years commencing from October 24, 2024 up to October 23, 2029.

3) Appointment of Mr. Jayesh Mehta (DIN 10529297) as Independent Director for a first term of ve years commencing from October 24, 2024 up to October 23, 2029.

4) Regularization of Mr. Hidefumi Fujii (DIN 10627503) from the post of Additional Non-Executive and Non Independent Promoter Director category to Non-executive and Non Independent Promoter Director category

Mr. Sraban Kumar Karan, had resigned from the position of Company Secretary and Key Managerial Personnel w.e.f. November 30, 2024 after office hours. Ms. Srishti Jain had been designated as Company Secretary & Compliance Of cer w.e.f. February 03, 2025.

21. Committees of the Board

The Board of Directors have the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee 3. Stakeholders Relationship Committee

The details of the Committees along with their composition, number of meetings held and attendance at the meetings are provided in the Corporate Governance Report.

22. Statutory Auditors

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In accordance with the provisions of the Companies Act, 2013, the shareholders at their 50 AGM held on July 28, 2022 re-appointed M/s. BSR and Co. Chartered Accountants (a member entity of BSR & Af liates)

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having ICAI Firm Registration No. 128510W for a further period of ve consecutive years (2 Term) as

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Statutory Auditors of the Company from the conclusion of the 50 AGM till the conclusion of the 55 AGM to be held for the Financial Year 2026-27.

M/s. BSR & Co. Chartered Accountants, having ICAI Firm Registration No. 128510W as Statutory Auditors of the Company has given their report on Financial Statements for the Financial Year 2024-25. The same will be adopted by the Members in the ensuing Annual General Meeting. There is no qualification or adverse remark in Auditors' report.

23. Cost Auditor and Cost Audit Report

As per Section 148 of the Companies Act read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to prepare, maintain as well as have the audit of its cost records conducted by a Cost Accountant and accordingly, it has made and maintained such cost accounts and records. On the recommendation of the Audit Committee, M/s. Diwanji & Co., Cost and Management Accountants (Firm

Registration No.: 000339), have been re-appointed as the Cost Auditor for the financial year 2025-26.

In terms of the provisions of Section 148(3) of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be ratified by the Members of the Company. Accordingly, the Board seeks rati cation at the ensuing Annual General Meeting for the remuneration payable to the Cost Auditors for the financial year 2024-25.

24. Secretarial Auditor

In terms of Section 204 of the Act and Rules made thereunder, M/s. J. J. Gandhi & Co., Practicing Company Secretaries were appointed as Secretarial Auditors of the Company to carry out the Secretarial Audit for FY

2024-25. The report of the Secretarial Auditors for FY 2024-25 is enclosed as Annexure C forming part of this Report.

There has been no quali cation, reservation, adverse remark or disclaimer given by the Secretarial Auditors in their Report.

Further, in terms of Section 204 of the Act and Regulation 24A of the SEBI Listing Regulations, the Board of Directors has, on the recommendation of the Audit Committee, approved the appointment of M/s. J. J. Gandhi & Co., as the Secretarial Auditors of the Company, to hold office for a term of ve (5) consecutive years with effect from financial year 2025-26 to financial year 2029-30, subject to approval of the Members of the Company at the ensuing AGM. Accordingly, a resolution seeking Members approval for appointment of Secretarial Auditors of the Company forms part of the Notice of the 53 AGM forming part of this Annual Report.

25. Reporting of Fraud

During the year under review, Auditors have not reported any instances of fraud under section 143(12) of the Companies Act, 2013.

26. Subsidiaries, Joint Ventures and Associates

Your Company does not have any subsidiary / subsidiaries, joint ventures and associates within the meaning of the Companies Act, 2013. Your Company is subsidiary of Panasonic Holdings Corporation.

27. Deposits

The Company has not accepted any xed deposits and accordingly no amount was outstanding as on the date of the Balance Sheet.

28. Particulars of Loans, Guarantees or Investments made under Section 186 of the Companies Act, 2013

There are no loans, guarantees or investments covered under the provisions of Section 186 of the Companies Act, 2013.

29. Transfer to Investor Education and Protection Fund (IEPF)

As per Section 124(6) of the Act read with the IEPF Rules as amended, all the shares in respect of which dividend has remained unpaid / unclaimed for seven consecutive years or more excluding those having Court case, if any, have been transferred to an IEPF Account.

During the year, the Company has transferred 1,70,716 number of shares to the IEPF Authority Account.

30. Disclosure under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Disclosures required under Section 197 of the Companies Act, 2013 read with Rule 5 of Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014 have been annexed herewith. (Ref. "Annexure-D")

Details of employee remuneration as required under the provisions of section 197 of the Act and Rule 5(2) and (3) of the Rule are available to any shareholders for inspection on request. If any shareholder is interested in obtaining copy thereof, such shareholder may write to the Company Secretary, where upon a copy would be sent through email only.

31. Nomination & Remuneration Policy

The remuneration paid to the Directors, Key Managerial Personnel and Senior Management Personnel are in accordance with the Nomination and Remuneration policy. As per the said Policy, the Nomination & Remuneration Committee (NRC) has formulated criteria for determining quali cations, positive attributes and independence of directors and other matters in terms of provisions of section 178(3) of the Act. The above policy has been posted on the website of the Company viz. https://www.panasonicenergyindia.in

32. Compliance with all the applicable laws of Secretarial Standards

During the year, the Company has complied with all the applicable Secretarial Standards.

33. Significant and Material Orders passed by the Regulators or Courts

No significant and material order has been passed by the regulator, court, tribunal, statutory and quasi-judicial body impacting the going concern status of the Company and its future operations.

34. Application Made or Proceeding Pending Under The Insolvency And Bankruptcy Code, 2016

During the financial period under review, no application was made under the Insolvency and Bankruptcy Code, 2016 (IBC 2016) by the Company. No proceedings are pending under IBC 2016 against the Company.

35. Particulars of Valuation done at the time of One-Time Settlement And Valuation Done While Taking Loan From The Banks Or Financial Institutions

During the financial period under review, there were no instances of any one-time settlement against loanstaken from Banks or Financial Institutions.

36. Acknowledgment

Your Directors wish to place on record their appreciation of the contribution made by employees at all levels to the continued growth and prosperity of your Company. Your Directors also wish to place on record their appreciation to the shareholders, dealers, distributors, consumers and banks for their continued support.