The Directors hereby present the 42^nd Annual Report of the Company along with the Audited Financial Statements for the
Financial Year ended March 31, 2026.

Financial Performance

Key highlights of financial performance of the Company for the Financial Year 2025-26 are provided below:

Sales and Other Income registered an increase of 11.2%, Profit
before tax is 15.1% of revenue from operations as compared
to 16.8% in the previous year. Exports revenue increased over
previous year by 5.1%.

DIVIDEND

The Board, at its meeting held on May 20, 2026, has
recommended payment of final dividend at '110/- per equity
share, i.e. at the rate of 1,100 % of the face value of '10/-
each for FY 2025-26. (Previous Year: '105/- per equity share).
The dividend, if approved by the Members at the ensuing
Annual General Meeting, will result in a total cash pay-out of
'973 Million. The Company is in compliance with its Dividend
Distribution Policy as approved by the Board.

The closing balance of the retained earnings of the Company
for FY 2025-26, after all appropriation and adjustments was
'42,418 Million. Pursuant to Section 134 (3)(j) of the Act,
there is no amount to be transferred to reserves during the
period under review.

OPERATIONS

The Management Discussion and Analysis annexed herewith
provides full details of operational performance and business
analysis of the Company.

INDUSTRY OUTLOOK

The details regarding Industry Outlook are given in the
Management Discussion and Analysis, which forms a part of
this Annual Report.

HONEYWELL ACCELERATOR

Honeywell Accelerator is the Company’s best-in-class
operating system. The content is Honeywell-specific and it
offers a framework and toolkit that enables us to get work done
faster and smarter, and helps achieving the best business
practices as listed below:

• Revitalizing our Operating System to drive a sustainable
advantage.

• Revitalized operating system for how we manage and
govern the business.

• Includes employee resources like standard tools,
processes and playbooks.

• Removes barriers to execution and improves speed.

• Areas of benefits include innovation and product
development, integrated supply chain, customer service

and satisfaction, M&A integration, achievement of
financial and ESG objectives and talent development.

• Accelerator content also enhances digital acumen and
career development.

HUMAN RESOURCES

The Company believes in the immense potential of its
human capital and acknowledges that employees are the
core growth engine for the Company. The Company is
committed to creating an inclusive, performance oriented
and entrepreneurial culture that allows it to bring the best
out of every individual and team. The Company is committed
to creating an equal opportunity workplace, which promotes
openness and diversity. The Company has a strong employee
value proposition that focuses on challenging work that
matters, hiring and retaining the right people, sustained
focus on talent and leadership development, differentiated
rewards to drive exceptional performance and community
engagement.

The Company deploys a Labour and Employment Relations
framework which elicits feedback in our factory and supports
action planning to drive engagement at all levels in the
organisation.

As on March 31, 2026, the Company’s employee strength
(full-time employees) was 3,167 as compared to 3,140 as on
March 31, 2025. Women employees represent 18.8% of the
workforce.

DIRECTORS, KMP AND SMP

As on March 31, 2026, the Board comprises of:

1. Dr. Ganesh Natarajan (DIN: 00176393), Independent
Director and Chairman (Non-Executive) - Board

2. Ms. Neera Saggi (DIN: 00501029), Independent Director

3. Mr. Atul Vinayak Pai (DIN: 02704506), Managing Director

4. Mr. Ashish Kumar Modi (DIN: 07680512), Non-Executive
Director

5. Mr. Robert David Mailloux (DIN: 10859792), Non¬
Executive Director

6. Mr. Jake Morgan Wasserman (DIN: 11364789), Non¬
Executive Director.

The following changes have taken place in the composition of
the Board and the KMP during the year under review:

• Resignation of Mr. Pedro Thena Garrote (DIN: 10741347),
Non-Executive Director of the Company from the
directorship of the Company with effect from November
5, 2025.

• Appointment of Mr. Jake Morgan Wasserman (DIN:
11364789) as an Additional Director (Non-Executive)
of the Company with effect from November 5, 2025. His
appointment as a Non-Executive Director of the Company
was approved by the Shareholders by way of Postal Ballot,
results of which were declared on January 30, 2026.

• Re-appointment ofDr. Ganesh Natarajan (DIN:00176393)
as an Independent Director of the Company, not liable to
retirement by rotation, to hold office for the second term of
3 (three) consecutive years on the Board of the Company
commencing from March 8, 2026 up to March 7, 2029
(both days inclusive) was approved by the Shareholders
by way of Postal Ballot, results of which were declared on
January 30, 2026.

• Resignation of Mr. Pulkit Goyal as the Chief Financial
Officer of the Company and Key Managerial Personnel
under the Companies Act, 2013, with effect from
May 21, 2026.

The Board places on record its appreciation of the valuable
contribution made by Mr. Pedro Thena Garrote and Mr. Pulkit
Goyal during their respective tenure with the Company.

No changes have taken place in the composition of KMP of
the Company during the year under review. Mr. Atul Vinayak
Pai (DIN: 02704506), Managing Director, Mr. Pulkit Goyal,
Chief Financial Officer and Ms. Indu Daryani (FCS No. F9059),
Company Secretary are the Key Managerial Personnel of the
Company, pursuant to the provisions of Section 2(51) and
Section 203 the Act, as on March 31, 2026 and as on the date
of this Report.

At the Board Meeting held on May 20, 2026, the Board
approved appointment of Mr. Satish Kumar Agarwal as the
Chief Financial Officer of the Company and Key Managerial
Personnel under the Companies Act, 2013 with effect from
June 1, 2026.

As per the provisions of the Act, Mr. Ashish Kumar Modi (DIN:
07680512) retires by rotation at the forthcoming AGM, and
being eligible, offers himself for re-appointment. The Board
recommends his re-appointment.

The Board is of the opinion that the Independent Directors
of the Company have fulfilled the conditions as specified
in the SEBI Listing Regulations, are independent of the
management, possess requisite qualifications, experience
and expertise in the fields of industry knowledge, board

governance, financials, strategy, leadership and they hold
highest standards of integrity.

Details of SMP is provided in the Corporate Governance
Report, which forms part of this Annual Report.

BOARD MEETINGS

During the Financial Year 2025-26, the Board duly met four
times on (i) May 13, 2025, (ii) August 1, 2025, (iii) November
5, 2025, and (iv) February 2, 2026. The intervening period
between two Board meetings was well within the maximum
gap of 120 days as prescribed under the provisions of the
Act.

Details of attendance at the Board Meetings is provided in
the Corporate Governance Report, which forms part of this
Annual Report.

COMMITTEES OF THE BOARD

The Board has the following statutory committees as per the
requirements of the SEBI Listing Regulations and the Act:

• Audit Committee

• Nomination and Remuneration Committee

• Corporate Social Responsibility Committee

• Stakeholders’ Relationship Committee

• Risk Management Committee

Details of terms of reference of the Committees, Committee
membership and attendance at meetings are provided in
the Corporate Governance Report, which forms part of this
Annual Report.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declarations from the
Independent Directors as required under Section 149(7) of
the Act, that he/she meets the criteria of Independence laid
down under Section 149(6) of the Act and Regulation 25 of
the SEBI Listing Regulations.

BOARD EVALUATION

Pursuant to the provisions of the Act and the SEBI Listing
Regulations, the Board has carried out an annual evaluation
of its own performance, its committees, as well as the
Directors individually. The outcome of the Board evaluation
was discussed by the NRC and the Board on February 2, 2026.
Details regarding process and criteria for evaluation are given
in the Report on Corporate Governance, which forms a part of
this Annual Report.

CODE OF CONDUCT COMPLIANCE

The declaration signed by the Managing Director affirming
compliance with the Code of Conduct by Directors and Senior
Management, for the Financial Year ended March 31, 2026, is
given in Report on Corporate Governance, which forms a part
of this Annual Report.

CORPORATE SOCIAL RESPONSIBILITY

The Annual Report on CSR activities, as required under
Section 135 of the Act read with the Companies (Corporate
Social Responsibility Policy) Rules, 2014 is annexed
herewith as Annexure-1 to the Directors’ Report. A copy of
the CSR Policy is available on the Company’s website at
https://www.honeywell.com/in/en/hail#policies. A copy of
the Impact Assessment Report is available on the Company’s
website at https://www.honevwell.com/in/en/hail#aam-egm-postalballot

AUDITORS

Statutory Audit

Pursuant to the provisions of Section 139 of the Act and
the rules framed thereunder, Walker Chandiok & Co LLP,
Chartered Accountants (Firm Registration No. 001076N/
N500013) were appointed as the Statutory Auditors for a
period of 5 years at the 41^st AGM of the Company held on
June 27, 2025 to hold office from the conclusion of the
41^st AGM up to the conclusion of the 46^th AGM to be held
in the year 2030 of the Company on such remuneration
as was approved by the shareholders at the 41^st AGM,
re-produced below:

* Subject to addition or reduction upto 10% with prior approval of Audit Committee and
Board.

Further, in addition to the above, the Statutory Auditors are
also entitled to fees for others service like Audit of Internal
Financial Controls, Tax Audit and Certificates etc. subject to
prior approval of Audit Committee and Board.

Statutory Auditors’ Report

There are no qualifications, reservations or adverse remarks
made by Walker Chandiok & Co LLP, Chartered Accountants
(Firm Registration No. 001076N/N500013), Statutory
Auditors, in their report for the Financial Year ended March
31, 2026. The Notes on financial statements referred to in the
Auditors’ Report are self-explanatory.

Pursuant to provisions of Section 143 (12) of the Act,
the Statutory Auditors have not reported any incident

of fraud to the Audit Committee during the year under
review.

Cost Audit

In terms of the provisions of Section 148 and other applicable
provisions of the Act read with Rule 14 of the Companies
(Audit and Auditors) Rules, 2014, Cost Audit is applicable to
the Company for the Financial Year 2025-26.

The Company has maintained the cost accounts and records
as specified by the Central Government under sub-section (1)
of section 148 of the Act for the Financial Year ended March
31, 2026. The Cost Auditors have not reported any incident of
fraud for the year under review.

The Board at its meeting held on May 20, 2026, based on
the recommendation of the Audit Committee, appointed C
S Adawadkar & Co. (Firm Registration No. 100401) as the
Cost Auditors of the Company for the Financial Year ending
March 31, 2027, at a remuneration of '7,00,000/- plus
GST and reimbursement of out-of-pocket expenses. An
Ordinary Resolution proposing ratification of Cost Auditor’s
remuneration for FY 2026-27 forms part of the Notice of the
42^nd AGM of the Company.

Secretarial Audit

Pursuant to the provisions of Regulation 24A of the SEBI
Listing Regulations and Section 204 of the Act read with
Rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, J B Bhave & Co, Practicing
Company Secretaries, Peer Reviewed Company Secretary
(bearing Unique Identification No. S1999MH025400)
were appointed as the Secretarial Auditors of the Company
at the 41^st AGM of the Company held on June 27, 2025, for
a term of 5 (Five) consecutive years from FY 2025-26 till FY
2029-30.

The report of the Secretarial Auditors for FY 2025-26
is enclosed as Annexure-2 to the Directors’ Report. The
Secretarial Audit Report does not contain any qualification,
reservation or adverse remark. The Secretarial Auditors
have not reported any incident of fraud for the year under
review.

RELATED PARTY TRANSACTIONS

The particulars of contracts or arrangements with related
parties referred to in Section 188(1) of the Act read with Rule
8(2) of the Companies (Accounts) Rules, 2014 are enclosed
herewith as Annexure-3 to the Directors’ Report.

RISK MANAGEMENT

The Company has an Enterprise Risk Management framework
administered by the Risk Management Committee to develop,
implement and monitor the effectiveness of risk management

processes for the Company. The structured framework
enables identification, assessment, monitoring and mitigation
of strategic, operational, compliance, financial, reputation,
technology & data and ESG risks that are key to achieving our
business objectives.

To ensure a comprehensive approach, Risks are identified,
evaluated and prioritized based on their likelihood of
occurrence and severity of business impact.

Major risks identified by the businesses and functions are
systematically addressed through mitigation plan and
governance and reviewed by the Risk Management Committee
and Audit Committee/Board.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

In line with requirement under Section 177(9) and (10) of
the Act and Regulation 22 of the SEBI Listing Regulations,
the Company has established a whistle blower/vigil
mechanism for its employees and Directors to report
their genuine concerns. The details of the same are provided
in the Corporate Governance Report.

INTERNAL FINANCIAL CONTROLS

The Board has adopted policies and procedures for
ensuring orderly and efficient conduct of its business,
including adherence to the Company’s policies, safeguarding
of its assets, prevention and detection of frauds and
errors, accuracy and completeness of the accounting
records, and timely preparation of reliable financial
information.

HOLDING COMPANY

The Company is a subsidiary of HAIL Mauritius Limited, the
ultimate holding Company being Honeywell International
Inc. USA. The Company does not have any Joint Venture(s) or
Associate Company(ies) or Subsidiary Company(ies).

TRANSFER OF AMOUNTS TO INVESTOR

EDUCATION AND PROTECTION FUND

As required under Section 124 of the Act, the unclaimed
dividend lying with the Company for a period of seven years
pertaining to the Financial Year 2017-18 amounting to
'5,73,760/- was transferred during the Financial Year 2025¬
26 to the Investor Education and Protection Fund established
by the Central Government. Members who have not encashed
the dividend warrant(s) so far for the period ended March
31, 2019 or any subsequent financial years are requested to
make their claim. It shall be noted that once the dividend is
transferred to the Investor Education and Protection Fund as
above, no claim shall lie with the Company in respect of such
amount.

PARTICULARS OF EMPLOYEES

A statement containing particulars of employees as required
under Section 197(12) of the Act, read with Rule 5(2) of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is provided as Annexure-6 to the
Directors’ Report. As per the first proviso to Section 136(1)
of the Act, the Annual Report is being sent to the members
excluding the aforesaid Annexure. The said information will
be open for inspection electronically upon request by the
Members during the AGM. Any member interested in obtaining
such information may write to the Company Secretary at
HAIL.InvestorServices@Honeywell.com.

The ratio of the remuneration of each Director to the median
employee’s remuneration and other details prescribed
in Section 197(12) of the Act read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, are enclosed in Annexure-4 to the
Directors’ Report.

The Nomination and Remuneration Policy of the
Company is available on the website of the Company at
https://www.honeywell.com/in/en/hail#policies.

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

The Company respects and values diversity reflected
in various backgrounds, experiences and ideas and is
committed to providing employees with a workplace that is
free from discrimination or harassment. The Company has
adopted a policy on prevention, prohibition, and redressal of
sexual harassment at workplace in line with the provisions of
the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. Every employee is
required to complete mandatory online training on Prevention
of Sexual Harassment at Workplace.

The Company has Internal Complaints Committees
established in accordance with the aforesaid Act for
addressing sexual harassment incidents.

One complaint on sexual harassment was received by the
Company during the Financial Year under review. The same
was pending resolution as at the end of the Financial Year
ended March 31, 2026. The said complaint was investigated
by the Internal Complaints Committee, and necessary actions
have been taken by the management. The matter has been
resolved as on the date of this Report.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS

The Company has not made any loans, guarantees or
investments during the year under review, pursuant to the
provisions of Section 186 of the Act.

MATERIAL CHANGES AND COMMITMENTS
AFFECTING THE FINANCIAL POSITION OF THE
COMPANY

There are no material changes and commitments affecting
the financial position of the Company which have occurred
between the end of the Financial Year of the Company to which
the financial statements relate and the date of the Report.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders during the
Financial Year ended March 31, 2026 passed by the regulators
or courts or tribunals impacting the going concern status and
the Company’s operations.

DEPOSITS

The Company has not accepted any deposits from public and
as such, no amount on account of principal or interest on
deposits from public was outstanding as on the date of the
balance sheet in accordance with the Act read with Companies
(Acceptance of Deposits) Rules, 2014.

CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE

Information required under Section 134 of the Act read with
Rule 8 (3) of the Companies (Accounts) Rules, 2014, with
respect to conservation of energy, technology absorption and
foreign exchange earnings/outgo is included in Annexure-5
to the Directors’ Report.

MANAGEMENT DISCUSSION & ANALYSIS

The Management Discussion and Analysis pursuant to the
SEBI Listing Regulations are annexed and form part of the
Annual Report.

ANNUAL RETURN

Pursuant to Section 92 (3) of the Act and Rule 12 (1) of the
Companies Management and Administration) Rules, 2014,
the Annual Return is available on the website of the Company
at https://www.honevwell.com/in/en/hail#agm-egm-postal-ballot.

CORPORATE GOVERNANCE REPORT

The Company believes in adopting best practices of corporate
governance.

As per Regulation 34 of the SEBI Listing Regulations, a
separate section on corporate governance practices followed
by the Company, together with a certificate from M/s Bokil
Punde & Associates, Company Secretaries, on compliance
with corporate governance norms under the SEBI Listing
Regulations, is provided in Corporate Governance Report
which forms part of this Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to provisions of Section 134(3)(c) and Section
134(5) of the Act, Directors make the following statements:

a. In the preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures, if any.

b. 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
on March 31, 2026, and of the profit for the year April 1,
2025 to March 31, 2026.

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

d. The Directors have prepared the annual accounts on a
going concern basis.

e. The Directors have laid down internal financial controls
to be followed by the Company and that such internal
financial controls are adequate and were operating
effectively.

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

COMPLIANCE WITH SECRETARIAL STANDARDS

The Directors confirm that the Secretarial Standards issued by
the Institute of Companies Secretaries of India, as applicable
to the Company, have been duly complied with.

DIVIDEND DISTRIBUTION POLICY

In compliance with Regulation 43A of the SEBI Listing
Regulations, the Company has formulated Dividend
Distribution Policy and the same is available on the Company’s
website at https://www.honeywell.com/in/en/hail#policies.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT

In compliance with the provisions of Regulation 34 (2) (f) of
the SEBI Listing Regulations, the Business Responsibility and
Sustainability Report (BRSR) forms part of this Annual Report.

In terms of the SEBI Listing Regulations, the Company
has obtained BRSR Reasonable assessment on BRSR
Core Indicators from MMJC Consultancy LLP, Mumbai,
which forms part of the Annual Report and is also

made available on the website of the Company at
https://www.honeywell.com/in/en/hail#agm-egm-postal-ballot.

GENERAL DISCLOSURES

The Directors state that no disclosure or reporting is required
in respect of the following items as there were no transactions
on these items during the year under review:

a. Issue of Equity Shares with differential rights as to
dividend, voting or otherwise.

b. Issue of Equity Shares (including Sweat Equity Shares) to
employees of the Company under any scheme.

c. The Company has not resorted to any buy back of its equity
shares during the year under review.

d. The Company does not have any subsidiaries. Hence,
neither the Managing Director nor the Whole-time
Directors of the Company received any remuneration or
commission during the year from any of its subsidiaries.

e. The details of 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 along with the reasons thereof is not
applicable.

f. The details of application made or any proceeding
pending under the Insolvency and Bankruptcy Code, 2016
during the year along with their status as at the end of the
Financial Year is not applicable.

g. There has been no change in the nature of business of the
Company.

ACKNOWLEDGMENT

The Board would like to place on record its appreciation and
thanks to all its employees for their contribution. The Board
wishes to acknowledge the support it has received from
its shareholders, investors, customers, vendors, regulatory
authorities and bankers.

For and on behalf of the Board
Dr. Ganesh Natarajan

Independent Director and
Chairman (Non-Executive) - Board
DIN:00176393
Pune, May 20, 2026