The Board of Directors (the Board) is delighted to present 45^th Annual Report on the business and operations of ZF Steering Gear
(India) Limited (the Company) along with the summary of Standalone and Consolidated financial statements for the financial year
(FY) ended on March 31, 2025.

I) Performance Review and state of the Company's affairs

(Rs. in crore)

II) Dividend

In order to conserve resources of the Company, for
the purpose of the Company's ongoing expansion/
diversification plans, through its Subsidiaries, the Board
decided not to recommend any dividend for the financial
year ended on March 31, 2025.

III) Share Capital

During the year under review, there was no change in the
paid-up capital of the Company.

As on March 31, 2025, the paid-up share capital of the
Company stood at Rs. 9,07,73,000 (Rupees Nine crore
Seven Lakh Seventy-Three Thousand only) comprising
90,73,300 (Ninety Lakh Seventy-Three Thousand Three
Hundred) equity shares of Rs. 10/- each.

IV) Consolidated Financial Statements

Subsidiaries, Associates and Joint Ventures

The Company has prepared Consolidated Financial
Statements for the Financial Year ended on March 31,
2025, in addition to the Standalone Financial Statements,
as there were three Subsidiaries of the Company as of
March 31, 2025.

The detailed information on Subsidiaries of the Company
along with Loans and Investments made therein is
provided under the para 'Investment in Subsidiaries' of
the Management Discussion and Analysis Report, forming
part of this Report. Further, Form AOC-1 is attached to
the Consolidated Financial Statements for the Financial
Year ended on March 31, 2025, forming part of this Annual
Report, giving key financials of the subsidiaries.

The Company did not have any Associate Company as of
March 31, 2025.

Consolidated Financial Statements for the Financial Year
ended on March 31, 2025, form part of this Annual Report.

V) Management discussion and Analysis

1. Indian Economy

India became the 4th largest global economy in 2025,
driven by domestic reforms and global positioning
under the vision of Aatmanirbhar Bharat. India is the
world's fastest-growing major economy.

Despite global uncertainties and internal economic
challenges, India has demonstrated remarkable
resilience.

In FY 2024-25, the Indian economy grew by
approximately 6.5%, supported by robust domestic
consumption, sustained capital expenditure by the
government, and improved manufacturing and services
activity.

Outlook - FY 2025-26 and beyond

The Reserve Bank of India (RBI) has retained Indian
economy's real GDP growth forecast at 6.5%, citing
strong domestic demand, infrastructure push, and a
supportive monetary stance. Inflation is expected to
remain moderate, averaging around 3.7%, with the RBI
signaling a neutral-to-accommodative policy stance to
support growth.

A normal monsoon is expected to support broader
economic activity, especially in rural and semi-urban
regions, which would be a tailwind for auto sector
demand. India's commercial vehicle (CV) industry
is poised for a modest recovery in FY 2025-26.
Nevertheless, India may face challenges amidst
geopolitical uncertainties.

The Government has initiated the formulation of the
Automotive Mission Plan 2047 aimed at enhancing
innovation, global competitiveness, and sustainable
development to establish India as a global leader by
2047.

2. Industry Overview

Number of Commercial Vehicles (CV) Sold

The overall Commercial Vehicle sales were 10.37
lakh units in FY 2024-25, as compared to 10.34 lakh
units in FY 2023-24, registering miniscule growth
of 0.3%. Sales of Medium and Heavy Commercial
Vehicles increased from 3.92 lakh to 3.97 lakh units
(1.2% increase) and Light Commercial Vehicles dipped
from 6.42 lakh to 6.40 lakh units (0.3% decrease) in
FY-2024-25, compared to the previous year. Delays
in infrastructure projects and Government spending

due to elections, Financing constraints, and Inventory
Overhang were the main factors for the miniscule
growth.

(Source: SIAM -Society of Indian Automobile
Manufacturers)

As per Auto Components Manufacturers Association's
(ACMA) report, the country's Auto Components'
production and aftermarket sales grew robustly in FY
25, even amid external volatility. The auto component
sector saw 9.6 per cent growth, reaching ' 6 lakh crore,
despite softened exports and rare earth Shortages.

3. Company Overview

Your Company caters to requirements of steering gear
systems for a range of Commercial Vehicles (including
buses) and Tractors. The Company's Power Steering
Systems are fitted on Commercial Vehicles as well
as some models of Tractors having less than 45 HP.
Mechanical Steering Gear Systems of the Company
are fitted on various types of Tractors.

Your Company Sales:

4. Renewable Energy
Solar Energy

The Company's 5 MW Solar Power Project at Gujarat
Solar Park, Charnka Village, District Patan (Kutch),
Gujarat, generated 0.69 crore Units of Electricity with
sales-revenue of Rs. 4.50 crore in the FY 2024-25. The
entire electricity is purchased by Gujarat Urja Vikas
Nigam Limited (GUVNL), a Government of Gujarat
Company, in terms of the multi-year Power Purchase
Agreement.

The Company's rooftop solar project, situated at
its Vadu Budruk plant, generated 0.17 crore units of
electricity in FY 2024-25, which are captively consumed
in the said plant.

Wind Energy

Wind Turbine Machines, owned and operated by the
Company, located in districts of Satara, Ahmednagar
& Sambhajinagar (formerly known as Aurangabad),

having aggregate capacity of over 8.10 MW generated
a total of 1.17 crore units in FY 2024-25. Out of this,

0.98 crore units were used as captive consumption,
which accounted for approximately 64.3% per cent of
the energy-consumption of the Company's factory at
Village Vadu Budruk, and remaining 0.19 crore units
were sold to Maharashtra State Electricity Board.

5. Financials of the Company (based on Standalone
figures)

Revenue from Operations

During the financial year under review, revenue from
sales of auto-components, that is Steering Gear
Systems and its components, went up by 4%.

Revenue from Renewable Energy declined by 44.3%,
in view of the downward revision in the unit-rate of
electricity, in terms of the Power Purchase Agreement
entered into with GUVNL in December 2010 coupled
with deterioration in income from Solar Rooftop, due to
climate change, wear and tear of Solar Panels etc.

Total Revenue from Operations went up by 1.05%.

Finance Cost

Finance cost was Rs.2.86 crore (5.7% of PBT) for FY
2024-25 (compared to Rs. 0.91crore (1.6% of PBT) in
FY 2023-24, due to higher utilisation of working capital
limits availed from Banks.

Other Income

During the year under review, Other Income was
Rs. 28.21 crore as against Rs. 37.78 crore in the
Financial Year 2023-24. Other Income (mainly) is
aggregate of the realised gains during the financial
year, on sale of financial investments during the year
and the unrealised gains, based on mark to market
valuation as of March 31, 2025, on the financial
investments held as of that date as well as subsidy
received Rs. 4.16 crores, from Madhya Pradesh State
Government. For details of Other Income, kindly refer
to Note No. 16 to the Financial Statements.

Financial Investments

As of March 31, 2025, Financial Investments of
the Company stood at Rs.168.53 crore as against
Rs.142.12 crore as of March 31, 2024. Both the
amounts reflect the fair/ market value of the financial
investments held by the Company, at the end of the
respective financial years, apart from the bonds and
equity investments in the subsidiaries held by the
Company, which are valued at cost. For complete list of
Investments held by the Company at year-end, kindly
refer to Note No. 5[a] of the Financial Statements.

Interest Coverage Ratio:

Reduction in Interest coverage ratio is due to increased
interest cost resulting from higher borrowings and
lower profits, compared to previous year.

Current Ratio:

The current ratio has dipped mainly due to substantial
increase in current liabilities, the reason being increase
in short-term borrowings and Trade Payables.

Reduction in Net Profit Margin was mainly due to lower
Other Income and much higher Tax Expense.

8. Return on Net Worth

The Company is efficiently using Members' equity to
generate profit, which was reduced due to absorption
of fixed expenses obligation.

9. Segment wise Profitability

Auto-Components Segment reported Profit before Tax
(PBT) of Rs. 20.43 crore, substantial improvement
over the previous year. Renewable Energy Segment
reported PBT of Rs. 8.55 crore and PBT from other
(Un-allocable) segment/ Other Income was Rs. 21.46
crore against Rs. 31.07 crore in previous year.

10. Outlook, Opportunities and Threats

i) Communication received from ZF Friedrichshafen AG

As reported in the previous year's Board's Report, the
Company received a communication dated 19 October
2022, from ZF Friedrichshafen AG ('ZF AG'), regarding
alleged infringement and passing off, of the trademark/
mark “ZF” and/or “ZF India” and amongst other alleged
demands, ZF Friedrichshafen AG claimed a sum of Rs.100
crore in damages from the Company. The Company
continues to be of the opinion that it has not committed
any act of infringement and/ or passing off, in any manner
whatsoever. The Company vide communication dated 12
April 2023, had sent a detailed reply to ZF Friedrichshafen
AG. The allegations of ZF Friedrichshafen AG and/or ZF
India Private Limited are neither accepted nor acceptable
to the Company. The Company also sent a letter to certain
affiliates of ZF Friedrichshafen AG, to cease and desist the
use of the name “ZF” and/ or “ZF India”, in relation to certain
products, as per the terms of the No-Objection Letter dated
28 July 2006, issued by the Company to ZF Friedrichshafen
AG. In addition to the same, the Company has filed 2
(two) commercial suits against ZF Friedrichshafen AG
and others, before the Hon'ble District Court, Pune and
the same are pending for adjudication before the Hon'ble
District Court, Pune.

Further, In September 2024, the Company received a
communication, from ZF Friedrichshafen AG and ZF India
Private Limited, stating that they have filed a Commercial
IP Suit along with Interim Application before the Hon'ble
High Court of Judicature at Bombay in relation to the
alleged infringement of the alleged trademarks/ mark of ZF
Friedrichshafen AG and/ or and ZF India Private Limited and
amongst other things, ZF Friedrichshafen AG and ZF India
Private Limited have allegedly demanded a sum of Rs. 200
crore in alleged damages, from the Company and prayed
for certain interim relief(s) till the conclusion of the aforesaid
Commercial Suit. The said Commercial Suit and the said
Interim Application is pending consideration of the Hon'ble
High Court of Judicature at Bombay. In the Company's
opinion, it has not committed any act of infringement and/
or passing off and the Company does not in any manner
whatsoever, accepts any allegation of infringement,
passing off and/ or demands of ZF Friedrichshafen AG and
ZF India Private Limited. This disclosure is made, without
prejudice to the rights of the Company and only in order to
comply with the applicable disclosure requirements to the
Company, as a listed entity.

ii) Strategic Initiatives, Expansion and Capital Expenditure

1. Investment in Subsidiaries

The Company, as a strategy, had chalked out an
Expansion Plan, by way of backward integration,
through its subsidiaries, for manufacturing of some
of the key components, required for the Company's
end product i.e. Steering Gear Systems. Backward
Integration plans have been carried out and they are in
operation.

The Company has now planned diversification
through subsidiaries, by entering into the businesses
of Aluminium Extrusion and Manufacture of certain
Electric Equipment's Components, as detailed further
in this Report. These projects are being undertaken
through its subsidiaries:

Names of the Subsidiaries are:

(i) DriveSys Systems Private Limited (DriveSys)

(ii) NexSteer Systems Private Limited (NexSteer)

(iii) Metacast Auto Private Limited (Metacast)

DriveSys and NexSteer - Wholly Owned Subsidiaries

DriveSys and NexSteer were initially formed to
ensure in-house reliable source of supply of semi¬
finished components required for the Company's
existing business line. External market is being tapped
after fulfillment of internal requirements. DriveSys
manufactures Machined Components viz. housing
machining, sector shaft machining, piston machining,
oil tanks, plastic injection moulding, Steering Pump
Assembly etc.

During FY 2024-25, DriveSys clocked turnover of Rs.
24.79 crore, majority of sales were to ZF Steering
Gear (India) Limited. Phase II expansion has started.
Raw Material supplies from Metacast have now been
established. Further, new machinery will be ordered on
receipt of new orders from customers.

The Construction of Factory Building for NexSteer is
complete and NexSteer has applied to MIDC for issue
of Building Completion Certificate (BCC).

As already announced, the Company's Wholly Owned
Subsidiary - DriveSys Systems Private Limited
(DriveSys) is set to enter into new businesses,in order
to enhance the Company's product portfolio, diversify
revenue streams and to gain advantage of favorable
market conditions across various sectors. These are:

- Aluminium Extrusion and Melting, for which
operations are proposed to be carried out at the
factory of NexSteer, situated at Plot No. E-3/2,
MIDC Supa Parner Industrial Park, Ahmednagar
414 301 (the said facility). The said facility is
adjacent to the factory of DriveSys. Further,
Factory Building of NexSteer is now ready and
NexSteer has applied to MIDC for issue BCC. In
furtherance of the foregoing developments and
pursuant to the approval and recommendation of
the Board of Directors of the respective Wholly
Owned Subsidiaries, the Board has approved in¬
principle, the sale/ transfer and/ or assignment
of leasehold rights in the said facility (land and
factory building), held by NexSteer, to DriveSys,
at arm's length price, on the receipt of BCC and
subsequent receipt of statutory approval/s from
various authorities. In that case, NexSteer would
not be required to operate as Captive Process
Vendor (CPV) for DriveSys.

- Business activities pertaining to manufacturing
of Moulded Case Circuit Breaker (MCB/ MCCB),
Residential Current Circuit Breaker (RCB) and
Mechanism Operated Auxiliary Contactor (MOC),
wherein estimated outlay is around Rs. 12 crore.

- Machineries for both the projects either have
been ordered or being ordered and the arrival of
the same is expected to start from the Month of
October 2025.

The Details of Investments in DriveSys and NexSteer,
by the Company as on March 31,2025, are as follows:

Further, DriveSys has also availed credit facility from a
bank and its closing balance stood at Rs. 26.4 crore,
at the year-end. NexSteer has not availed any facility
from the bank.

Metacast - 51% Subsidiary and Joint-Venture

Metacast is a Joint-Venture with Supreme Iron (India)
Private Limited. Metacast is in the foundry business.

Metacast operates as the Captive Process Vendor
(CPV) for DriveSys, for supply of castings.

Metacast commenced commercial production in the
month of November 2024 and has clocked turnover of
Rs. 9.44 crore for the year ended on March 31, 2025,
majority of sales was to DriveSys.

During the Financial Year 2024-25, Metacast issued
79.5 lakh equity shares of Rs. 10 each, on Rights
basis at the premium of Rs. 2 per share, to its existing
Promoters/ shareholders, pursuant to which Metacast's
paid-up share capital stood at Rs. 8 crore as on
March 31, 2025. After the aforementioned issue, the
Company's investment in Metacast is Rs. 4.90 crore
(including premium on Rights Issue) by way of 51%
equity participation in its equity share Capital.

As of March 31, 2025, closing balance of Loans taken
by Metacast from (both) the Promoters was Rs. 26.13
crore. Additionally, closing balance of credit facilities
availed by Metacast from Bank, was Rs. 24.98 crore.

2. Capital-Expenditure

In the current Financial Year, your Company has
planned Rs. 26 crore towards replacement of old
machinery, procurement of balancing equipment etc.
for its Pune and Pithampur factories. Further, the
Company has allocated around Rs. 94 crore towards
subsidiaries out of which Rs. 22 crore is for expansion
plans of their existing business and Rs. 72 crore is for
new business lines of DriveSys.

3. Financing and Fund Raising

The Members would kindly recall that in the previous
Annual General Meeting of the Company, the
Members had granted approval to the Company to
issue additional equity shares of the Company, for an
amount not exceeding Rs 200 crore (including share-
premium) through private placement, preferential
issue, qualified institutions placement etc. As the
capital market response was not up to the Company's
expectations, the proposed issue has been shelved for
the time being. The Company would tap the market at
an opportune time. Till then, the Board has decided to
fund the projects through internal accruals and bank
borrowings.

iii) Internal Control System and its Adequacy

Your Company has aligned its current systems of internal
financial control with the requirements of the Companies
Act, 2013 (the Act). The Internal Control framework is
intended to increase transparency and accountability in
the Company's process of designing and implementing

systems of internal control. The framework requires
a company to identify and analyse risks and manage
appropriate responses.

The Company has successfully laid down the framework
and ensured its effectiveness.

The Company has an effective Internal Control System
commensurate with the size, scale and complexity of its
operations. The Company's Audit Committee periodically
reviews adequacy and effectiveness of the Internal
Control System. Further, the Internal Audit Department of
the Company checks all the vouchers, financial reports,
registers etc. To maintain its objectivity and independence,
the Board has also appointed an external Chartered
Accountant firm, M/s. Kirtane & Pandit LLP, as Internal
Auditors, which report to the Audit Committee of the Board.
The scope of the Internal Audit is decided by the Audit
Committee and the Board.

The Internal Auditors monitor and evaluate the efficacy and
adequacy of internal control systems in the Company, its
compliance with operating systems, accounting procedures
and policies for various functions in the organisation of the
Company. The Audit Committee, Statutory Auditors and the
process owners are periodically apprised of the internal
audit findings and important internal audit observations are
also placed before the Audit Committee and the Board at its
Meetings. Based on the report of Internal Auditor, process
owners undertake corrective action, wherever required, in
their respective areas and thereby strengthen the controls
Further, Audit observations and actions taken thereof are
presented to the Audit Committee.

The Company's Audit Committee regularly reviews the
financial management reports/ data and interacts with
the External and Internal Auditors for ascertaining the
adequacy of internal controls.

Based on its evaluation, the Company's Audit Committee
has concluded that, as of March 31, 2025, the Company's
internal financial controls were adequate and operating
effectively.

iv) Cautionary Statement

The above 'Management Discussion and Analysis Report'
is a forward looking Statement based on the Company's
projections, estimates and perceptions. These statements
reflect the Company's current views with respect to the
future events and are subject to risks and uncertainties.
Actual results may vary materially from those projected
here.

VI) Conservation of Energy, Research and Development,
Technology Absorption and Innovation, Foreign
Exchange Earnings and Outgo:

The details as required under the Companies (Accounts)
Rules, 2014, are given in Annexure-I to this Report.

VII) Board of Directors and Key Managerial Personnel:

With effect from April 1, 2025, the Company's Board
comprise seven Directors, all professionals in their own
right, who bring in a wide range of skills and experience
to the Board. Two of them are Executive Directors, one
Non-Executive, Non-Independent Director and four are
Independent Directors (including one Woman Independent
Director).

Following are the changes in composition of the Board of
Directors of the Company, during the Financial Year 2024¬
25.

Pursuant to the recommendation of the Nomination and
Remuneration Committee of the Board, the Board appointed
Mr. Rohit Rathi as a Non-Executive, Independent Director
of the Company, for five consecutive years, with effect from
August 6, 2024, which was approved by the Members of
the Company at its 44th Annual General Meeting (AGM)
held on September 10, 2024.

Mr. S.A. Gundecha and Mr. Shridhar Kalmadi, Non¬
Executive, Independent Directors of the Company, ceased
to be Directors, following completion of their second
term of five consecutive years, with effect from close
of business hours on September 14, 2024 and March
31, 2025, respectively. The Board places on record the
appreciation for the valuable contribution, support and
guidance rendered by Mr. S.A. Gundecha and Mr. Shridhar
Kalmadi, during their tenure as Independent Directors of
the Company.

Further, Based on the recommendations of the Nomination
and Remuneration Committee of the Board:

- Mr. Shrenik Gandhi and Mr. Bharat Agarwal, were
appointed as Non-Executive, Independent Directors of
the Company, by the Board, with effect from April 1,
2025. The Members of the Company, had approved
their appointments as Directors of the Company, by
way of Postal Ballot which concluded on March 22,
2025.

- Mrs. Smita Lahoti was reappointed as the Non¬
Executive, Independent Director for second term of
Five consecutive years, with effect from June 27, 2025,
the said reappointment was approved by the Members,
by way of Postal Ballot, which concluded on March 22,
2025.

Pursuant to the requirements under Section 152(6) of the
Act, Dr. Dinesh Bothra retires by rotation and he offers
himself for reappointment at the ensuing 45th Annual
General Meeting of the Company. The Nomination and
Remuneration Committee and the Board of Directors of
the Company have recommended the reappointment of
Dr. Dinesh Bothra (DIN: 00049883) in the ensuing Annual
General Meeting.

The Resolution for reappointment of Dr. Dinesh Bothra
(DIN: 00049883) along with his brief profile, forms a part of
the Notice of 45th Annual General Meeting of the Company.

There was no change in the Key Managerial Personnel
during the year.

1. Board Diversity

The Company recognizes and embraces the
importance of a diverse Board in its success.
The Company believes that a truly diverse board
will leverage differences in thought, perception,
knowledge, skill, regional and industry experience,
cultural and geographical background, age, ethnicity,
race and gender, which will help the Company to retain
its competitive advantage.

2. Independent Directors

Pursuant to the provisions of Section 149 of the
Act and Regulation 25 of the Listing Regulations,
the Independent Directors of the Company have
submitted declarations that each of them meets the
criteria of independence as provided in Section 149(6)
of the Act along with Rules framed thereunder and
Regulation 16(1 )(b) of the Listing Regulations. In
terms of Regulation 25(8) of the Listing Regulations,
the Independent Directors have confirmed that they
are not aware of any circumstance or situation which
exists or may be reasonably anticipated that could
impair or impact their ability to discharge their duties
with an objective independent judgment and without
any external influence.

Further, declaration on compliance with Rule 6(3) of
the Companies (Appointment and Qualification of
Directors) Rules, 2014, as amended by Ministry of
Corporate Affairs (“MCA”) Notification dated October
22, 2019, regarding the requirement relating to
enrollment in the Data Bank created by MCA for
Independent Directors, has been received from all
Independent Directors of the Company. Further, all
the Independent Directors have either qualified or are
exempted from the self-assessment conducted by the
Independent Directors' Databank.

Familiarisation Programmes for Independent
Directors

Independent Directors play a pivotal role in upholding
Corporate Governance norms and ensuring fairness
in decision-making. Being experts in various fields,
they also bring independent judgement on matters
of strategy, risk management, controls and business
performance.

Details of familiarization programme, imparted to the
Independent Directors, are available on the website of
the Company at www.zfindia.com.

At the time of appointing a new Independent Director,
a formal letter of appointment is issued to the Director,

inter alia, explaining the role, duties and responsibilities
of the Director. The Director is also explained in detail
the compliances required from him/ her under the Act,
SEBI Regulations and other relevant regulations.

3. Performance Evaluation

The Board of Directors has carried out an annual
evaluation of its own performance, Board Committees,
and individual Directors pursuant to the provisions of
the Act and the Listing Regulations.

Your Board has constituted the Nomination and
Remuneration Committee (hereinafter referred to
as “the Committee”), in order to oversee, inter-alia,
matters relating to:

(i) Identification of persons who are qualified to
become directors and persons who can be
appointed in senior management in accordance
with the criteria laid down, recommend to the
Board their appointment and removal;

(ii) Formulate the criteria for determining qualifications,
positive attributes and independence of a director;

(iii) Recommend to the Board a policy relating to the
remuneration for the directors, key managerial
personnel and other employees;

(iv) Carry out evaluation of every director's performance
including that of Independent Directors; and

(v) Devise a policy to be followed for identification,
appointment, remuneration and evaluation of
performance of directors including Company's
Board diversity etc., as approved by the Board.

Further, the Company has devised a Policy, for
performance evaluation of Independent Directors,
Board as a whole, Committees of the Board and other
individual Executive/ Non-Executive Directors. The
Policy includes criteria for performance evaluation.
The criteria are based upon age, experience, quality
of participation in Board/ Committee proceedings,
attendance at meetings, contribution by strategic
inputs and others. The criteria along with additional
requirements prescribed by Section 149 of the Act are
used for selection of Independent Directors.

The Board evaluated its performance after seeking
inputs from all the Directors based on criteria such as
the Board composition and structure, effectiveness
of board processes, information and functioning, etc.
The performance of the Committees was evaluated
by the Board after seeking inputs from the Committee
members based on criteria such as the composition of
committees, effectiveness of committee meetings, etc.
The above criteria are broadly based on the Guidance
Note on Board Evaluation issued by the Securities and
Exchange Board of India.

In a separate meeting of Independent Directors,
performance of the Non-Independent Directors
and the Board as a whole and the Chairman of the
Company was evaluated taking into account the views
of Executive Directors and Non-Executive Directors.

The above evaluations were then discussed at the
Board meeting that followed the meeting of the
Independent Directors and the Nomination and
Remuneration Committee, at which the performance
of the Board, its Committees, and individual Directors
was also discussed. Performance evaluation of
Independent Directors was done by the entire Board,
excluding the Independent Director being evaluated.

The Company carried out the performance evaluation
during the year under report. The Board of Directors
expressed satisfaction with the evaluation process.

VIII) Directors' Responsibility Statement

1. In the preparation of the Annual Financial Statements
for the financial year ended on March 31, 2025,
the applicable Accounting Standards read with
requirements set out under Schedule III to the
Companies Act, 2013 (the Act), have been followed
and there are no material departures from the same;

2. the Directors have selected such Accounting Policies
and applied them consistently and made judgments
and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the
Company as at March 31, 2025, and of the profit of the
Company for the financial year ended on that date;

3. 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 the Company and for
preventing and detecting fraud and other irregularities;

4. the Directors have prepared the annual financial
statements on a 'going concern' basis;

5. the Directors have laid down internal financial controls
to be followed by the Company and that such internal
financial controls, in their opinion, are adequate and
are operating effectively; and

6. the Directors have organised/ devised proper systems
to ensure compliance with the provisions of all
applicable laws and that such systems are adequate
and operating effectively.

IX) Corporate Governance

Pursuant to Regulation 34(3) read with Schedule V of

the Listing Regulations, a detailed report on Corporate

Governance is given in Annexure - II along with the

Auditors' Certificate on its compliance, which forms part of

this report.

X) Business Responsibility and Sustainability Report (BRSR)

The Business Responsibility and Sustainability Report,
for the year ended on March 31, 2025, is not applicable
to your Company, as the Company has remained out of
its applicability for three consecutive years, as per the
Securities and Exchange Board of India (Listing Obligations
and Disclosure Requirements) (Amendment) Regulations,
2024.

XI) Other Aspects

1. Particulars of Loans given, Investments made,
Guarantees given and Securities provided

The Particulars of Loans given, Investments made,
Guarantees given and Securities provided by the
Company, are disclosed in the Financial Statements
forming part of this Annual Report.

2. Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered
into by the Company during FY 2024-25, with related
parties were on an arm's length basis and in the
ordinary course of business.

Prior approval of the members of the Audit Committee,
who are Independent Directors, was obtained for all
the related party transactions in terms of provisions of
Regulation 23(2) of the Listing Regulations.

All the Material Related Party Transactions (RPTs)
undertaken by the Company during the year were duly
approved by Shareholders under the provisions of
Regulation 23(4) of the Listing Regulations.

Certain RPTs which were repetitive in nature were
approved through omnibus route. The Audit Committee
reviews the details of the Related Party Transactions
entered pursuant to the omnibus approval, on a
quarterly basis.

All the transactions were in compliance with the
applicable provisions of the Act and the Listing
Regulations. The details of RPTs during FY 2024¬
25, are provided in the Note 35 accompanying the
financial statements. Given that the Company does
not have any RPTs to report pursuant to provisions of
Section 134(3)(h) of the Act read with Rule 8(2) of the
Companies (Accounts) Rules, 2014 in Form AOC-2, is
not required to be attached to the Financial Statements
of the Company.

During 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.

Further, the Board recommends the resolution, for
approval of the Members, forming part of Notice of 45th
AGM, in respect of Material Related Party Transactions,

in terms of Regulation 23(1) of the Listing Regulations
for Purchase of Raw Material/ Components etc.,
Sale of Castings, Machined Housings and Related
Outputs, Job Work for Machining of Castings and
other transactions in Ordinary Course of Business,
by the Company and its Subsidiaries viz DriveSys
and Metacast, with Supreme Autocasts, Supreme
Iron (India) Private Limited, Supreme Autocasts
Private Limited, and Supreme Engineering - Related
Parties of Metacast - Subsidiary and Joint Venture
of the Company. The transaction/s being material
related party transactions have been approved and
recommended by the Audit Committee and approved
by the Board of Directors of the Company, which now
requires Members' approval.

The Company has formulated a policy on RPTs in
accordance with the Act and the Listing Regulations
including any amendments thereto for identifying,
reviewing, approving and monitoring of RPTs. The said
policy is available on the Company's website: http://
www.zfindia.com/policies-codes.php.

3. Corporate Social Responsibility (CSR)

Pursuant to provisions of Section 135 of the Act read
with the Companies (Corporate Social Responsibility)
Rules, 2014 and various amendments and clarifications
issued by the Ministry of Corporate Affairs, the
Company has its CSR Policy, which is available on
the Company's website www.zfindia.com. The Annual
Report on CSR activities is annexed herewith marked
as Annexure III.

4. Risk Management

The Company follows a specific, well-defined risk
management framework which is integrated with its
operations.

The Company's Risk Management approach has been
developed after taking cognizance of the relevant
statutory guidelines, stakeholders' feedback, forecast
and expert judgment.

Your Company is not required to constitute a separate
Risk-Management Committee.

The Audit Committee of the Board of Directors has
been entrusted to identify/ anticipate the possible
risk and certify the Risk Mitigation Plan. Further, the
Company's Senior Management Team addresses
functional, operational, and strategic risks in their
corresponding area of responsibility covering overall
risks in the area of commercial, technical, information
technology and statutory compliance.

The Company's Risk Management Framework inter-
alia provides for the following:

i. pro-active processes within the Risk Management
Framework for reporting, evaluating, and resolving
risks;

ii. Identifying and assessing risks associated with
various business decisions before they materialize;

iii. Take informed decisions at all levels of the
organization in line with the Company's risk
appetite;

iv. Ensuring protection of shareholders' stake by
establishing an integrated Risk Management
Framework for identifying, assessing, mitigating,
monitoring, evaluating and reporting all risks;

v. Adoption and implementation of risk mitigation
measures at every level in order to achieve long¬
term goals effectively and sustainably; and

vi. Regularly review Risk Tolerance levels of the
Company.

The Company manages, monitors and reports on the
major risks and uncertainties, which can impact its
ability to achieve its strategic objectives. The Company
has introduced several improvements in internal
control management to drive a common integrated
view of risks, optimal risk mitigation, responses and
efficient management of internal control and assurance
activities.

5. Auditors and Auditors' Report
Statutory Auditors

The Company in its 44th Annual General Meeting
held on September 10, 2024 had reappointed M/s.
Joshi Apte & Company, Chartered Accountants (Firm
Registration No. 104370W), as Statutory Auditors of
the Company, for a second term of five consecutive
years from the conclusion of 44th Annual General
Meeting until the conclusion of 49th Annual General
Meeting.

There are no qualifications, reservations or adverse
remarks in the Statutory Auditors' Reports for the
Financial Year 2024-25. The Statutory Auditors'
Reports are enclosed with the financial statements in
the Annual Report.

Secretarial Auditor

The Board had appointed M/s. SIUT & Co., LLP,
Company Secretaries, to conduct Secretarial Audit
for the financial year 2024-25. The Secretarial Audit
Report for the same is annexed herewith as Annexure
IV. The Secretarial Audit Report does not contain any
qualification, reservation or adverse remark.

Pursuant to amendments in the Listing Regulations, the
appointment of Secretarial Auditors requires approval
of the Members of the Company in terms of Regulation
24A of the Listing Regulations, and the tenure of the
said appointment shall not be for more than single
term of five years, in case if Secretarial Auditor is an

individual and in case of a firm, the same shall not be
more the two terms of five consecutive years.

In furtherance of the foregoing developments, the
Board recommends resolution for appointment of M/s.
SIUT & Co., LLP, Company Secretaries, to hold office,
for the period of five years from FY 2025-26 to FY
2029-30. The said resolution forms part of the Notice
of 45th AGM of the Company.

The Company has received requisite consent from M/s.
SIUT & Co., LLP, to act as the Secretarial Auditors of
the Company for aforementioned period. Further, the
Company has also obtained declaration from M/s. SIUT
& Co., LLP, confirming their Non-Disqualification to act
as the Secretarial Auditors of the Company, as outlined
in Regulation 24A (1A) of the Listing Regulations read
with SEBI Circular No. SEBI/HO/CFD/CFD-PoD-2/
CIR/P/2024/185, dated December 31, 2024.

6. Disclosures
Meetings of the Board

Five Meetings of the Board of Directors were held
during the financial year 2024-25. Detailed information
is given in the Report on Corporate Governance,
forming part of this Annual Report.

7. Committees of the Board
Audit Committee

The Company has an Audit Committee pursuant
to the requirements of the Act, read with the rules
framed there under and the Listing Regulations. The
details relating to the same are given, in the Corporate
Governance Report, forming part of this Report. All the
recommendations made by the Audit Committee were
accepted by the Board.

The Audit Committee performs its functions as set out
under Part C of Schedule II to the Listing Regulations.

The detailed terms of reference of the Audit Committee
are set out in the Corporate Governance Report.

Nomination and Remuneration Committee

The Company has Nomination and remuneration
Committee (the Committee) pursuant to Section
178 of the Act, read with rules made thereunder and
Regulation 19 of the Listing Regulations. The brief
details pertaining to the same are given in Corporate
Governance Report, forming part of this Report. All
the recommendations made by the Committee were
accepted by the Board.

The Nomination and Remuneration Committee
performs its functions as set out under Para A of Part D
of Schedule II to the Listing Regulations.

The detailed terms of reference and functions are set
out in Corporate Governance Report.

Remuneration Policy

The Board, has on the recommendation of the
Nomination & Remuneration Committee, approved
a policy for selection, appointment and remuneration
of Directors and Senior Management. The detailed
Remuneration Policy is placed on the Company's
website www.zfindia.com.

Stakeholders' Relationship Committee

The Board has constituted Stakeholders' Relationship
Committee in accordance with the provisions of Section
178 of the Act, read with rules made thereunder and
Regulation 20 of the Listing Regulations.

The Stakeholders' Relationship Committee performs
its functions as set out under Para B of Part D of
Schedule II to the Listing Regulations.

The detailed terms of reference and functions are set
out in Corporate Governance Report.

Corporate Social Responsibility Committee

The Company has constituted Corporate Social
Responsibility Committee pursuant to the Section 135
of the Act and Rules made thereunder. The detailed
functions and constitution thereof of the Corporate
Social Responsibility Committee are set out in
Corporate Governance Report.

8. Vigil Mechanism/ Whistle Blower Policy

The Company has devised Vigil Mechanism, in terms
of Section 177 of the Act and Regulation 22 of the
Listing Regulations.

The Audit Committee periodically reviews the
functioning of the Vigil Mechanism and ensures that:

a. All the Directors/ Employees are made aware of
the Company's Vigil Mechanism;

b. The Vigil Mechanism provides adequate
safeguards against victimization of person who
use such mechanism and also provides direct
access to the Chairman of the Audit Committee in
appropriate/ exceptional cases; and

c. The Company has Whistle Blower Policy in terms
of Section 177 of the Act and Regulation 22 of the
Listing Regulations, which outlines procedures for
a person who is willing to use the Vigil Mechanism
to address their concerns.

Further, no concerns were raised by any of the
employees of the Company during the Financial Year.

The Policy on Vigil Mechanism and Whistle Blower
may be accessed on the website of the Company at
www.zfindia.com.

9. Annual Return

The Annual return is placed on the Company's website
http://www.zfindia.com/annual-return.php

10. Industrial Relations

By and large, Industrial Relations at all locations of
the Company were amicable. The Company has
been constantly endeavouring to improve quality,
reduce cost, ensure safety and improve productivity
at all levels. Emphasis was also laid towards raising
awareness on health and wellness of employees.

For details on some of the pending litigations, which
are not material financially, please refer to Note No. 31
under Notes to Accounts.

11. Particulars of Employees and related disclosures

Considering the provisions of Section 197 of the Act,
read with the relevant rules and having referred to
provisions of Section 136(1) of the Act, the Board's
Report is being sent to the Members of the Company,
excluding details of particulars of employees and
related disclosures. The said information/ details are
available for inspection at the Registered Office of the
Company during working hours, on any working day.
Any Member interested in obtaining this information
may write to the Company Secretary and this
information would be provided on request.

12. Disclosure - Policy on Prevention of Sexual
Harassment at Workplace

The Company has in place, a policy on Prevention
of Sexual Harassment at Workplace in line with the
requirements of 'The Sexual Harassment of Women
at Workplace (Prevention, Prohibition & Redressal)
Act, 2013' and the Rules framed there under. An
Internal Complaints Committee (ICC) has been set
up to redress complaints received regarding sexual
harassment. All employees (permanent, temporary,
trainee etc.) are covered under this Policy.

Details of Complaints Received by the ICC During
the Year:

13. General

(i) The Company held no deposits at the beginning
of the year, nor accepted any deposits during the
year under report.

(ii) All equity shares issued by the Company rank
pari-passu in respect of right to receive dividend,
voting rights or otherwise.

(iii) During the year under review, no shares were
issued as sweat equity to any of the employees or
others.

(iv) The Company had three Subsidiaries during
the Financial Year 2024-25. However, no
remuneration was received by any Whole-time
Director/ Employees of the Company, from any of
the subsidiaries.

(v) During the year under report, no strictures or
material orders were passed by any Regulator or a
Court or a Tribunal, which may impact on the going
concern status of the Company or its operations in
future.

(vi) There has been no instance of fraud reported by
the Auditors under Section 143(12) of the Act and
Rules framed there under either to the Company
or to the Central Government.

(vii) The Central Government, under Section 148(1) of
the Act, has not prescribed maintenance of cost
records in respect of the activities carried out by
the Company.

(viii) During FY 2024-25, the Company has complied
with all applicable Secretarial Standards issued by
the Institute of CompanySecretaries of India.

(ix) There have been no material changes or
commitments affecting the financial position of
the Company which have occurred between the
end of the Financial Year to which the Financial
Statements relate and the date of this report.

(x) The Company has not filed any application or no
proceeding is pending against the Company under
the Insolvency and Bankruptcy Code, 2016, during
FY 2024-25.

(xi) The Company has not made any one-time
settlement application during the year and thus
disclosure for difference between amount of the
valuation done at the time of one-time settlement
and the valuation done while taking loan from the
banks or financial institutions, is not applicable to
the Company.

(xii) The Company has duly complied with all the
relating to the Maternity Benefit Act, 1961.

XII) Acknowledgement

The Board of Directors takes this opportunity to thank
the Company's members, customers, suppliers, bankers/
business partners, employees, and Central and State
Governments for their consistent support and co-operation
to the Company.

Dinesh Munot

Pune Chairman

July 26, 2025 (DIN: 00049801)