Drone Destination Ltd

Dear Members, Drone Destination Limited

Your Directors' have immense pleasure in presenting this 6^th Annual Report on the business and operations of your Company along with the Audited Financial Statements for the Financial Year ended March 31, 2025.

1. FINANCIAL RESULTS

The highlights of the financial performance of the Company for the Financial Year ended March 31, 2025, as stated in the Audited Financial Statements, along with the corresponding performance for the Previous Year are as under:

2. STATE OF YOUR COMPANY'S AFFAIRS

Drone Destination today operates an integrated “Everything Drones” platform focused on DGCA-certified pilot training and Drone-as-a-Service (DaaS). In FY 2024 25, we strengthened commercial deployments across agriculture, land and urban mapping, infrastructure inspection, and surveillance, supported by an expanding network of approved training organisations and proven field operations. Our offering spans end-to-end mission planning, data capture, processing/analytics, and program management, helping customers move from pilots to production with speed and compliance. Headquartered in New Delhi and listed on NSE Emerge, Drone Destination continues to advance safe, high-quality drone operations across agriculture, mapping, inspection and surveillance, as well as education and recreation.

Simultaneously, Drone Destination focuses on DaaS, delivering tailor-made solutions for agriculture spray, aerial surveying, and asset inspection services. Committed to innovation, Drone Destination empowers individuals and industries through training and DaaS offerings, shaping the future of drone technology.

3. PERFORMANCE OF YOUR COMPANY

The total income of your Company is Rs. 2,57,397.32(In Thousands) (- 21.09% YoY) during the Financial Year 2024-25 as against the total income of Rs. 3,26,201.56 (In Thousands) in the previous Financial Year 2023-24. The total expenditure is Rs. 3,46,030.35 (In Thousands) (49.54% YoY) during the Financial Year 2024-25 as against Rs. 2,31,389.30 (In Thousands) in the previous Financial Year 2023-24. Your Company has Loss after Tax of Rs. -68,138.53 (In Thousands) during the Financial Year 2024-25 as against earned profit after Tax of Rs. 70,821.02 (In Thousands) in the previous Financial Year 2023-24.

4. DIVIDEND AND TRANSFER TO RESERVES

Keeping in view the expansion of business of your Company, the Board of Directors of your Company has decided not to recommend any dividend for the Financial Year ended March 31, 2025. Further, there has been no transfer to general reserves. In view of the losses, your Directors do not propose to transfer any amount to the General Reserve.

5. CHANGE IN NATURE OF BUSINESS

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

6. AMENDMENT IN MAIN OBJECT CLAUSE OF MEMORANDUM OF ASSOCIATION (MOA):

Your Company amended its object clause of its Memorandum of Association of the Company with the addition of sub clauses 5, 6 and 7 after the existing sub clause 4 of clause III (A) by passing a Special resolution in Extra Ordinary General Meeting on 18^th March 2025. The approval/intimation letter was received from the MCA/ROC on 7^th April 2025.

7. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF YOUR COMPANY

There was no material change and commitment affecting the financial position of your Company that occurred in between the Financial Year ended on March 31, 2025 and the date of this report.

8. SHARE CAPITAL

During the period under review, there has been change in the Share Capital of your Company.

a) AUTHORISED SHARE CAPITAL

The Authorised Share Capital of your Company was increased from Rs. 26,00,00,000/- (Rupees Twenty Six Crores only) divided into 2,60,00,000 (Two Crore Sixty Lacs) Equity Shares of Rs. 10/- (Rupees Ten) each to Rs. 30,00,00,000/- (Rupees Thirty Crores only) divided into 3,00,00,000 (Three Crore) Equity Shares of Rs. 10/- (Rupees Ten) each on dated 15^th May, 2024.

b) PAID UP SHARE CAPITAL

Presently, the Subscribed & Paid Up Share Capital of your Company is Rs. 24,39,99,980 (Rupees Twenty Four Crore Thirty Nine Lakhs Ninety Nine Thousand Nine Hundred and Eighty) divided into 2,43,99,998 (Two Crore Forty Three Lakhs Ninety Nine Thousand Nine Hundred and Ninety Eight) Equity Shares of Rs. 10 each.

Raising of funds by issuance of Warrants convertible into Equity Shares on a private placement basis

Pursuant to the shareholders' approval received at the Extra-ordinary General Meeting held on May 15, 2024 and In - Principle approval under Regulation 28(1) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 dated September 9, 2024, your Company has issued 7,00,000 (Seven Lakhs Only) Convertible Warrants (“Warrants”), at a price of 187/- (Rupees One Hundred Eighty Seven Only) per warrant, aggregating upto 13,09,00,000/- (Rupees Thirteen Crores Nine Lakhs Only) (“Total Issue Size”), with a right to the warrant holders to apply for and be allotted 1 (One) fully paid-up equity share of the Company of face value 10.00/- (Rupees Ten only), each at a premium of 177/- (One Hundred Seventy Seven only) per share for each Warrant within a period of 18 (Eighteen) months from the date of allotment of Warrants.

The Company allotted 1,00,000 Equity Shares of face value of Rs. 10/- (Rupees Ten Only) upon conversion of 1,00,000 (One Lakh) Convertible warrant into Equity Shares pursuant to receipt of warrant exercise price of 187/- (Rupees One Hundred and Eighty-Seven Only) per warrant including premium of Rs. 177/- (Rupees One Hundred and Seventy-Seven Only) on a preferential basis, by way of private placement on 31^st December, 2024.

9. UTILIZATION OF FUNDS RAISED THROUGH PREFERENTIAL ISSUE OF EQUITY SHARES/WARRANTS/CONVERSION OF WARRANTS:

During the Financial Year under review, your Company issued 7,00,000 (Seven Lakhs Only) Convertible Warrants (“Warrants”), at a price of 187/- (Rupees One Hundred Eighty Seven Only) per warrant, aggregating upto 13,09,00,000/- (Rupees Thirteen Crores Nine Lakhs Only), out of which Rs 3,27,25,000/- being 25% of the said total consideration was received on 21^st September 2024. Further amount of Rs 1,40,25,000/- was received on 31^st December 2024 from two warrant holders (being 75% remaining amount). The amount of these two warrant holders has been converted into equity shares. Total amount received Rs. 4,67,50,000/- from warrant holder/equity shareholders and the funds were remain unutilized.

10. UTILIZATION OF FUNDS RAISED THROUGH INITIAL PUBLIC OFFER

Your Company raised Rs. 44,20,00,000 by way of Initial Public Offer dated 21^st July, 2023. The Company utilized Rs. 41,74,00,000 as per the objects specified in the prospectus except an amount allocated for purchase of vehicle i.e Rs. 2,46,00,000 is still unutilised at the end of the year.

11. PUBLIC DEPOSITS

During the Financial Year under review, the details relating to deposits, covered under Chapter V of the Act,-

(a) accepted during the year: NA

(b) remained unpaid or unclaimed as at the end of the year: NA

(c) 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- NA

(i) at the beginning of the year: NA

(ii) maximum during the year: NA

(iii) at the end of the year: NA

(iv) the details of deposits which are not in compliance with the requirements of Chapter V of the Act: NA

12. WEB LINK OF ANNUAL RETURN

Annual Report for the F.Y 2024-25 will be available on our website i.e www.thedronedestination.com.

13. DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the period under review, the changes in status of Directors and/or Key Managerial Personnel are as follows:

Pursuant to Section 149, 152 and other applicable provisions of the Companies Act, 2013, two-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Consequently, Mrs. Shashi Bala (DIN: 01547327) and Mr. Raminder Kumar Verma (DIN: 10064817), Directors of your Company will retire by rotation at the ensuing AGM, and being eligible, offers themself for re-appointment in accordance with provisions of the Act.

14. BOARD AND COMMITTEES' COMPOSITION AND THEIR MEETINGS Annual Evaluation of Directors, its Committees and Board:

The formal annual evaluation of the performance of the Board and that of its committees has been carried out through a structured evaluation process covering various aspects of the Board's functioning such as the Board structure & composition, effectiveness of the Board process, information flow & functioning, quality of relationship between the Board and the Management, establishment, and delineation of the responsibilities to Committees etc. The performance of Individual Directors was evaluated on parameters such as professional conduct, performance of duties, role and functions, contribution to the Board / Committee etc. by self evaluation process. The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with your Company.

As on the date, the Board of Directors of your Company comprises of total Five (5) Directors. The composition of the Board of Directors is as under:

During the Financial Year under review, 13 (Thirteen) meetings were held by the Board of Directors viz, 18^th April 2024, 19^th April 2024, 17^th May 2024, 24^th May 2024, 10^th July 2024, 18^th July 2024, 21^st September 2024, 30^th October 2024, 14^th November 2024, 10^th December 2024, 31^st December 2024, 20^th February 2025 and 22^nd March 2025. Further, the intervening gap between the Meetings was within the period prescribed under the Act.

Details of attendance of Directors in Board Meetings held during the Financial Year 2024-25 are as under:

AUDIT COMMITTEE:

During the Financial Year under review, 12 (Twelve) meetings were held by the Audit Committee viz, 18^th April 2024, 19^th April 2024, 17^th May 2024, 24^th May 2024, 10^th July 2024, 18^th July 2024, 30^th October 2024, 14^th November 2024, 10^th December 2024, 31^st December 2024, 20^th February 2025 and 22^nd March 2025. Further, the intervening gap between the Meetings was within the period prescribed under the Act.

The composition of the Committee and the details of meetings attended by its members are given below:

NOMINATION AND REMUNERATION COMMITTEE:

During the Financial Year under review, 4 (Four) meetings were held by the Nomination and Remuneration Committee viz, 10^th July 2024, 18^th July 2024, 10^th December 2024 and 22^nd March 2025. Further, the intervening gap between the Meetings was within the period prescribed under the Act.

The composition of the Committee and the details of meetings attended by its members are given below:

STAKEHOLDER'S RELATIONSHIP COMMITTEE:

During the Financial Year under review, 1 (One) meeting was held by the Stakeholder's Relationship Committee viz, 21^st September 2024.

The composition of the Committee and the details of meetings attended by its members are given below:

15. DISCLOSURE REGARDING CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company believes Corporate Social Responsibility (CSR) is commonly defined as a business model in which companies integrate social and environmental concerns in their business operations and interactions with their stakeholders, instead of only considering economic profits. During the Financial Year under review, 1 (One) meeting was held by the Corporate Social Responsibility Committee viz, December 10, 2024. A brief outline of the CSR philosophy salient features of the CSR Policy of the Company, the CSR initiatives undertaken during the Financial Year 2024-25 together with progress thereon and the report on CSR activities in the prescribed format, as required under Section 134(3)(o) read with Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure I.

The composition of the Committee and the details of meetings attended by its members are given below:

16. SEPARATE MEETING OF INDEPENDENT DIRECTORS

As stipulated by the Code of Independent Directors under Schedule IV under the Companies Act, 2013 and the Listing Regulations, 2015, a separate meeting of the Independent Directors of your Company was held on March 22, 2025 to review the performance of Non-Independent Directors, the Board as whole and evaluation of performance of your Company. The Independent Directors also reviewed the quality, content and timeliness of the flow of information between the Management and the Board and its Committees, which are necessary to effectively and reasonably perform and discharge their duties.

17. STATUTORY DISCLOSURES

None of the Directors of your Company is disqualified as per the provisions of Section 164(2) of the Act. The Directors of your Company have made necessary disclosures, as required under various provisions of the Act.

18. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

As required by the provisions of Companies Act, 2013, the relevant information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo are given under:

(A) Conservation of energy- NA

(i) the steps taken or impact on conservation of energy;

(ii) the steps taken by your Company for utilising alternate sources of energy; (iii) the capital investment on energy conservation equipments;

(B) Technology absorption-NA

(i) the efforts made towards technology absorption;

(ii) the benefits derived like product improvement, cost reduction, product development or import substitution;

(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year)-

1. the details of technology imported;
2. (b) the year of import;
3. (c) whether the technology been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

(iv) the expenditure incurred on Research and Development.

(C) Foreign exchange earnings and Outgo:-

The details of earnings and outgo in Foreign Exchange during the Financial Year ended March 31, 2025 are as follows:

Earnings: Nil

Outgo: 499.44 (In Thousands)

19. COMPLIANCES OF SECRETARIAL STANDARDS

During the Financial Year, your Company has duly complied with all the requirements as laid down in the applicable Secretarial Standards.

20. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, your Directors, based on the representation as provided to the Board by the management, confirm that:

a) in the preparation of the Annual Financial Statements for the Financial Year ended March 31, 2025, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) 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 your Company as on March 31, 2025, and of the profit & loss of your Company for the year under review;

c) the directors 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 your Company and for preventing and detecting fraud and other irregularities;

d) the directors have prepared the Annual Financial Statements for the Financial Year ended March 31, 2025 on a ‘going concern' basis;

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

21. DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS

The provisions of Section 149 of the Companies Act, 2013 with respect to the appointment of Independent Directors are applicable to your Company for the Financial Year ending March 31, 2025. The Board, after undertaking due assessment of the veracity of the declaration submitted by the Independent Directors under sub section (6) of Section 149 of the Companies Act, 2013 was of the opinion that the Independent Directors meet the criteria of independence, are independent from Management and have necessary integrity, expertise, skills and experience required for their appointment as Independent Director.

As required vide Rule 6 (1) & (2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 they have registered their names in the Independent Directors' Databank maintained by the Indian Institute of Corporate Affairs. Based on the declarations received from the Directors, the Board confirms, that the Independent Directors fulfil the conditions as specified under Schedule V of the Listing Regulations and are independent of the management. The Board of Directors are of the opinion that Mr. Rajiv Ahuja and Mr. Satendra Singh, Independent Directors of your Company meet the necessary criteria for continuing as Independent Directors of your Company.

22.STATUTORY AUDITORS

Pursuant to the provisions of Section 139 of the Act and the rules framed thereunder, M/s GAMS & Associates LLP, Chartered Accountants (Firm Registration No. N500094), were appointed as Statutory Auditors of your Company to hold office from the conclusion of 1^st Annual General Meeting (“AGM”) for a period of five years till the conclusion of the 6^th AGM of your Company to be held in the year 2025.

As the tenure of the Statutory Auditor will conclude till 6^th AGM of the Company, hence pursuant to the provisions of Section 139(2) and other applicable provisions, if any, of the Companies Act, 2013 and the Rules framed there under, GAMS & Associates LLP, Chartered Accountants (Firm Registration No. N500094), be and are hereby reappointed as Statutory Auditors of the Company, to hold office from the conclusion of this Annual General Meeting until the conclusion of the 11^th Annual General Meeting of the Company to be held in the year 2030.

23.STATUTORY AUDITORS' REPORT

The Statutory Auditors' Report does not contain any qualification, reservation or adverse remark. Further, the observations of the Auditors in their report read together with the Notes to Financial Statements are self-explanatory and therefore, in the opinion of the Board of Directors, do not call for any further explanation.

24. PARTICULARS OF LOANS, INVESTMENTS AND GUARANTEES

During the period under review, there is no transactions covered under section 186 of the Companies Act, 2013.

25. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the Financial Year under review were on an arm's length basis and in the ordinary course of business. Disclosures as required under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014, are provided in the Form AOC-2 which is annexed herewith as “Annexure II” and forms part of this Report.

26.RISK MANAGEMENT POLICY

Your Company has laid down a well-defined Risk Management Mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. A detail exercise is being carried out to identify, evaluate, manage and monitoring of both business and non-business risks. The Board reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework.

Your Company has Risk Management Policy and it is available on your Company's website i.e. www.thedronedestination.com.

27. CORPORATE GOVERNANCE

As per Regulation 15 read with Regulation 27 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 relating to Corporate Governance Disclosure does not apply to your Company listed on the SME platform. Hence, your Company is not required to make disclosures in Corporate Governance Report.

FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls with reference to financial statements. The internal financial controls with reference to the Financial Statements are adequate in the opinion of the Board of Directors. Also, your Company has a proper system of internal controls to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and that transactions are authorized, recorded and reported correctly. During the Financial Year 2024-25, such controls were tested and no reportable material weakness in the design or operation was observed.

29.VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations and in order to maintain these standards, your Company encourages the employees to voice their genuine concerns without fear of censure, therefore Company's ultimate holding Company has built in and set up the Vigil Mechanism Policy applicable to your Company, according to which all the directors, employees of your Company including third party, are eligible to make disclosures under the mechanism in relation to the matter concerning your Company.

Details of the Whistle Blower Policy are made available on your Company's website www.thedronedestination.com.

30. DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATES COMPANIES

During the period under review, your Company has one foreign subsidiary in terms of Section 2(87) of the Act in the name of “Drone Destination Europe Limited” incorporated on 18^th August, 2025 at Cyprus. Therefore, the statement containing the salient features of the financial statement of subsidiaries, associates or joint ventures under the first proviso to sub-section (3) of section 129 of the Companies Act, 2013 in Form AOC-1 is not applicable. Following are the Companies in which Director's has the common shareholding:

31. BUSINESS RESPONSIBILITY REPORT

Pursuant to Regulation 34 of the Listing Regulations, 2015, Business Responsibility Report is not applicable to your Company.

32.COST RECORDS

Maintenance of cost records as specified by the central government under sub-section (1) of Section 148 is not applicable to Company.

(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has adopted a Policy under the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013 and rules framed thereunder. The Company is committed to provide a safe and secure environment to its women employees across its functions and other women stakeholders, as they are considered as integral and important part of the organization. An Internal Complaints Committee (ICC) with requisite number of representatives has been set up to redress complaints relating to sexual harassment, if any, received from women employees and other women associates. All employees (permanent, contractual, temporary, trainees) are covered under this policy, which also extends to cover all women stakeholders of your Company. The following is the summary of sexual harassments complaints received and disposed off during the Financial Year ended March 31, 2025. No. of Complaints Received Nil No. of Complaints disposed off Nil No. of Cases Pending for more than 90 Days Nil No. of Workshops of awareness program against sexual harassment carried out : Mention Any Training Program conducted during year under review Nature of action taken by the employer or district officer ; Nil.

34. PARTICULARS OF EMPLOYEES

The disclosure as required under Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed herewith as “Annexure III” and forms part of this Report.

35. SECRETARIAL AUDITOR AND IT'S REPORT

The Annual Secretarial Compliance Report, as required under Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI Circular No.: CIR/CFD/CMD1/ 27/2019 dated 8th February, 2019, is not applicable to our Company due to the exemption provided under Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The shares of the Company are listed on SME Emerge Platform of National Stock Exchange of India Limited. Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company appointed Mr. Arvind Kumar Roy, the proprietor of M/s. A. K. Roy & Associates, Company Secretaries (FCS No. F8308; CP No.: 9147), to undertake the Secretarial Audit of your Company for the Financial Year 2024- 25.

There are no disqualifications, reservations, adverse remarks, or disclaimers in the Secretarial Auditor's report except the following observation:

During the period, the Company has not filed charge form against the vehicle with MCA, however those loans were treated as secured loans because on the registration certificates of the vehicles, hypothecation has been marked.

Director's Comment: The issue has already discussed by the board of directors.

The Report of the Secretarial Audit Report is furnished herewith in Annexure IV.

36. DETAILS OF FRAUD IF ANY, REPORTED BY AUDITORS

During the Financial Year under review, the Statutory & Secretarial Auditors have not reported any incident of fraud to the Board of Directors of your Company, pursuant to the provisions of Section 143(12) of the Companies Act, 2013.

COURTS

There are no significant or material orders passed by the Regulators/ Courts which would impact the going concern status of your Company and its operations in future.

BANKRUPTCY CODE, 2016

The above clause is not applicable to your Company as your Company has neither made any application nor any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 during the Financial Year 2024-25.

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

The above clause is not applicable to your Company as your Company has not entered into any settlement from Banks or Financial Institutions during the year under review.

40. CODE OF CONDUCT AS PER SEBI (PREVENTION OF INSIDER TRADING) REGULATIONS, 2015

The Board of Directors has laid down the Code of Practices and Procedures for Fair Disclosures of Unpublished Price Sensitive Information as per Regulation 8(1) of SEBI (Prevention of Insider Trading) Regulations, 2015 & Code of Conduct to Regulate, Monitor and Report trading by the Designated Persons as per Regulation 9(1) of SEBI (Prevention of Insider Trading) Regulations, 2015.

41. CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion & Analysis Report describing your Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence your Company's operations include global and domestic market conditions affecting cost as well as the selling prices of the services, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

42. ACKNOWLEDGEMENTS

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from the Bankers, Regulatory Bodies, Customers and other business associates who have extended their valuable sustained support and encouragement during the Financial Year under review