44^th ANNUAL REPORT OF THE BOARD OF DIRECTORS TO THE MEMBERS OF THE COMPANY

Your Directors have pleasure in presenting to you their 44th Annual Report together with the Audited Accounts of the Company for the year ended 31^st March, 2026 and the Auditors' Report thereon.

1. FINANCIAL RESULTS:

The summarized working results for the year ended 31^st March, 2026 as compared with the earlier year are as under:

2. DIVIDEND :

Your directors recommend a dividend of Rs.12/- per share (i.e.) 120%. The same is in line with the financial strategy and policy of the Company.

This dividend if approved by you at the ensuing 44th Annual General Meeting will be paid to the Shareholders whose names appear in the Register of Members as on 22^nd June 2026 (Record date for payment of dividend to the shareholders).

The dividend, when approved, will entail payment to all the shareholders of the Company. Applicable tax will be deducted if the Gross Dividend payable exceeds Rs. 10,000/-

3. TRANSFER TO RESERVE

The Board of Directors of your company have decided to transfer an amount of Rs. 20 Crores to the Reserves for the year under review.

4. MANAGEMENT DISCUSSION AND ANALYSIS:

INDUSTRY AND BUSINESS OVERVIEW OPERATIONAL AND FINANCIAL PERFORMANCE:

Our Company sold 2237 mln pieces of Carbon Rod, as against 2548 mln pieces which is 88% Sales of last year.

The Domestic Sales Quantity and Value were 1140 mln pieces and Rs.18.76 crores respectively in the year under review as compared to last year's quantity of 1234 mln pieces and Rs.21.65 crores, which works out to 92% of the Sales by quantity and 87% by value of last year.

The Export Sales Quantity and value were 1097 Mln. Pcs. and Rs.35.12 Crores respectively in the year under review as compared to last year's quantity of 1314 Mln. Pcs. and Rs.31.58 Crores which works out to 83% by quantity and 111% by value.

By implementing various cost reduction measures, the profitability (before tax) compared to the previous year increased by Rs. 221.67 lakhs.

OUTLOOK ON OPPORTUNITIES AND THREATS, RISKS AND CONCERNS:

The Company has developed skills to In-house design and fabricate special purpose machines/ equipment required for Carbon rod manufacturing. Introducing low-cost automations to lift and transfer the materials to reduce operator fatigue, to improve working conditions and to improve productivity.

Your Company is also hopeful of improving its Domestic and Export sales by improving its competitive power compared to Chinese and Indonesia manufacturers by continually putting efforts in developing cost-effective new grade carbon rods. Further by manufacturing consistent quality and timely supply, your Company is confident of maintaining the domestic and export sales at the current year's level in the coming years.

The Directors assure that all steps are being taken by the Company to achieve greater growth in the coming years, in proportion to the growth of the Dry Cell Battery Industry by giving due consideration to the adverse conditions, if any, in the Dry Cell Battery Industry. There are no materially significant threats, risks or concerns to the Company.

5. SEGMENT-WISE PERFORMANCE:

The Company operates in only one Segment (i.e.) Carbon Rod. By value, while domestic sales contributed 35% and export sales constituted the remaining 65% out of the total sales.

6. FINANCIAL ARRANGEMENTS AND DEPOSITS:

Your Company continues to be free from debts - both on Long Term and on Working Capital requirements. The surplus funds available with the Company are being invested with Banks in fixed deposits at regular intervals in line with the policy of the Company. This is reflected in increased deposits. Your Company had not accepted any Public Deposits under Chapter V of the Companies Act, 2013 (Act).

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014

7. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Directors had laid down internal financial controls to be followed by the Company and such policies and procedures are being adopted by

the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Audit Committee evaluates the internal financial control system periodically. A firm of experienced Chartered Accountants carried out Internal Audit throughout the year. Whenever it is required, the systems and procedures are upgraded.

The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis, which is a part of this report.

8. HUMAN RESOURCE DEVELOPMENT:

The relationship with Employees continues to be cordial. The Company always considers its human resources as its most valuable assets. Imparting adequate and specialized training to its employees is an ongoing exercise in the Company.

9. STATEMENT PURSUANT TO LISTING AGREEMENTS:

The Company's Securities are listed with BSE Ltd. The company confirms that it has paid the Annual Listing Fees to the said stock exchange for the financial year 2025-26 in time and there were no arrears.

10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO;

In compliance with section 134(3)(m) of the Act read with rule 8 of the Companies (Accounts) Rules, 2014 the prescribed particulars of conservation of energy, foreign exchange and technology absorption including R & D expenditure have been attached as Annexure-1 herewith.

11. CODE OF CORPORATE GOVERNANCE:

Pursuant to the Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, detailed report on Corporate Governance as updated with the particulars of this financial year, is annexed to this report as Annexure-2 together with Report of the Auditors on the compliance with the said Code.

12. EXPORT HOUSE STATUS:

The Company had obtained ONE STAR EXPORT HOUSE Certificate from Government of India, Ministry of Commerce and Directorate General of Foreign Trade (DGFT) in recognition of good Export

performance. The Company continues to enjoy the Export House Certificate status

13. AEO-T1 Status:

Your Company has been accredited the Authorized Economic Operator (AEO-T1) status, by Central Board of Indirect Taxes and Customs, Ministry of Finance, Government of India.

14. ENVIRONMENT:

Your Company has consistently emphasized and worked towards sustainable use of natural resources. In order to promote the Environment Awareness for everybody and everywhere with an objective to create awareness and boost the PCIN brand image on a global basis, your company had observed June month as "Environment month". The Company actively makes effort to increase awareness among the employees and their families about reduction of energy usage and also promote conservation of water.

The following Environment improvement activities carried during Environment month.

a. Communication of Environmental activities through display boards.

b. Environmental Education to Employees

i. Global Trends in Environmental Issues.

ii. Reasons for companies to tackle environmental problems.

iii. From Environmental Vision 2050 to Panasonic Green Impact.

c. Environmental Education to Staff members about Environment vision 2050 & Zero CO2 emission.

d. Trees plantation at PCIN factory premises.

e. Celebration of world Environment Day on 5^th June, 2025. ("Only One Earth")

f. Conducted Cleaning Campaign at Tada main road.

15. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

A. Composition of the Board of Directors and Key Managerial Personnel:

The Board of Directors of the Company as on 31^st March 2026, consisted of Mr. R.

Senthilkumar (DIN: 02170079), Managing Director, and Independent Non-Executive Directors, Dr. Paul Jayakar (DIN: 00692315) and Mrs. Rajashree Santhanam (DIN: 07162071) and Mr. Mogarala Sankara Reddy (Din: 07212025) and Non- Executive Director Mr. Hidefumi Fujii (DIN: 10627503), Non-Executive Director Mr. Akinori Isumora (Din: 09382377)( Resigned with effect 30th June 2025), Non- Executive Director Mr. Akio Fujita (Din: 11130669) w.e.f. 1^st July 2025. The composition of the Board of Directors is in compliance with Section 149 of the Companies Act, 2013.

Pursuant to the provisions of Section 203 of the Companies Act, 2013, Mr. R. Senthil Kumar, Managing Director & CEO, Mr. Vinayagam Sume, Chief Financial Officer and Mr. Brajesh Baral, Company Secretary and Compliance officer are the Whole Time Key Managerial Personnel (KMP) of the Company as on date of this report.

B. Changes in Directors and Key Managerial Personnel

The Board recommends passing of the Resolution set out at item No.4 of the Notice convening the Meeting.

The tenure of Mr. R. Senthil Kumar, Managing Director of the Company, expires on 31^st March 2026. On the recommendation of our Collaborators, M/s. Panasonic Holdings Corporation, Japan, he was again re-appointed as Managing Director of the Company for further period of one year with effect from 1^st April 2026 to 31^st March 2027 and the same was approved by the Board of Directors of the Company at their meeting held on 12^th February 2026 and accordingly his re-appointment is placed for approval of the shareholders.

The Board of Directors at their meeting held on 06th May, 2026 also revised his remuneration with effect from 1^st April, 2026 subject to your approval. The revised remuneration as detailed in resolution is now placed before you for your consideration and approval under item no.4. The Board recommends passing the Resolution set out in item No.4 of the Notice convening the Meeting in this regard.

At the Board Meeting held on 06^th May 2026, it was recommended that Mr. Prasad Bala Nagendra Venkatavara Vadlapatla (DIN: 11277706) be appointed as a Non-Executive Independent Director of the Company with effect from 30^th June 2026, pursuant to Sections 149, 150, and 152 of the Companies Act, 2013 and the Articles of Association of the Company. Accordingly, his appointment is being placed before the shareholders for their approval.

The Board recommends passing of the Resolution set out in item No.6 of the Notice convening the Meeting in this regard.

Cessation of Dr. Paul Jayakar (DIN: 00692315) as a Non-Executive Independent Director of the Company upon completion of two consecutive terms of office, with effect from 29^th June 2026.

Mr. Shiva Prasad Padhy, Company Secretary and Compliance Officer of the Company, has resigned from office with effect from 15^th May 2025 and Mr. Brajesh Baral, was appointed as Company Secretary and Compliance officer with effect from 16^th May 2025,

16. MEETINGS OF THE BOARD:

Five meetings of the Board were held during the year under review. For details of meetings of the Board, please refer to the Corporate Governance Report, which is a part of this report. The intervening gap between the Meetings was within the period as prescribed under the Companies Act, 2013 and Secretarial Standards.

17. PERFORMANCE EVALUATION:

The Board of Directors have carried out an annual evaluation of its own performance, Board committees, and Individual Directors pursuant to the provisions of the Act and SEBI Listing Regulations. The performance of the board was evaluated by the board after seeking input from all the directors on the basis of 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 input from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc. The above criteria are

based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

In the Board meeting that followed the meeting of the Independent Directors and meeting of Nomination and Remuneration Committee, the performance of the board, its committees, and Individual Directors was also discussed. The performance evaluation of Independent Directors was done by the entire board, excluding the independent director being evaluated.

18. POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management personnel, Key Managerial Personnel and fixing their remuneration.

The objective and broad framework of the Remuneration Policy is to consider and determine the remuneration, based on the fundamental principles of payment for performance, for potential, and for growth. The Remuneration Policy reflects on certain guiding principles of the Company such as aligning remuneration with the longer-term interest of the Company and its Shareholders. It also ensures the effective recognition of performance and encourages a focus on achieving superior operational results.

The Nomination and Remuneration Committee recommends the remuneration of executive Director, which is approved by the Board of Directors, subject to the approval of Shareholders, wherever necessary. The level and composition of remuneration shall be reasonable and sufficient to attract, retain and motivate the Directors and Key managerial personnel of the quality required to run the Company successfully.

The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Companies Act, 2013 has been disclosed in the Corporate Governance Report, which is a part of this report and is also available on www. panasoniccarbon.in

19. DIRECTORS’ RESPONSIBILITY STATEMENT:

Pursuant to the requirements u/s 134(5) of the Companies Act, 2013 with respect to Directors'

Responsibility Statement, your Directors confirm that they have:

1. Followed in the preparation of financial Statements, the applicable Accounting Standards and given proper explanation relating to material departures, if any;

2. Selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the Profit of the Company for that period.

3. Taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act so as to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.

4. Prepared the Annual Accounts on a Going Concern basis;

5. Laid down internal financial controls in the Company that are adequate and were operating effectively; and

6. Devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.

20. CORPORATE SOCIAL RESPONSIBILITY:

As part of its initiatives under "Corporate Social Responsibility (CSR), the Company has undertaken projects in the areas of Education, Health Care, Drinking Water, Rural Development and Sanitation. These projects are largely in accordance with Section 135 read with Schedule VII of the Companies Act, 2013 (Act). The brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the financial year under review are provided in the Annual Report on Corporate Social Responsibility Activities 2025-26 in Annexure-3 forming part of this report. The Policy adopted by the Company can be viewed at website of the Company, (www.panasoniccarbon. in)

21. AUDIT COMMITTEE:

The details pertaining to the composition of the audit committee are included in the Corporate Governance Report, which is a part of this report.

22. GREEN INITIATIVE:

During the year 2025-26, we continued the sustainability initiative with the aim of going green and minimizing our impact on the environment. Like the previous year, this year too, we are publishing only the statutory disclosures in the print version of the Annual Report. Additional information is available on our website, www.panasoniccarbon.in

Electronic copies of the Annual Report 2025-26 and Notice of the 44th AGM are sent to all members whose email addresses are registered with the Company / Depository Participant(s).

Pursuant to SEBI Circular No. SEBI/LAD-NRO/ GN/2024/218 dated December 12, 2024, read with Regulation 36(1 )(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the requirement of sending physical copies of the Annual Report to shareholders has been dispensed with for listed entities conducting their Annual General Meetings in compliance with the applicable provisions. Accordingly, the Annual Report of Panasonic Carbon India Co. Limited is being sent to shareholders through electronic mode and is also available on the Company's website i.e www. panasoniccarbon.in. However, Members who wish to obtain physical copy of Annual Report may send a request to the Company Secretary and Compliance Officer, Panasonic Carbon India Co. Limited.

The Company is providing remote e-voting facility to all members to enable them to cast their votes electronically on all resolutions set forth in the Notice. This is pursuant to section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014. The instructions for remote e-voting and Video conference e-voting procedures are provided in the Notice.

23. EXTRACT OF ANNUAL RETURN:

As per the requirements of Section 134 (3)(a) read with Section 92(3) of the Act and Rules framed thereunder, the extract of the annual return for FY 2025-26 is given in Annexure-4 in the prescribed Form No.MGT-9, which is a part of this report. The same is available on www.panasoniccarbon.in.

23. SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 (1 ) of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, the Company has appointed a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed to this report as Annexure - 5.

There are no qualifications or adverse remarks in the Secretarial Auditors' Report which require any clarification/ explanation.

25. PARTICULARS OF EMPLOYEES:

The information required pursuant to section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 and Companies (Particulars of Employees), Rules 1975, in respect of employees of the company and Directors is furnished in Annexure - 6.

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

The Company has in place an anti-Sexual Harassment Policy in line with the requirement of the Prevention of Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013. Internal complaints committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary and trainees) are covered under this policy.

The Company has not received any complaint of Sexual harassment during the year 2025-26 under review.

The following is the summary of Sexual Harassment complaints received and disposed of during the year 2025-2026.

27. Maternity Benefits Act, 1961

The Company is in compliance with the provisions relating to the Maternity Benefits Act, 1961.

28. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

There were no loans, guarantees or investments

made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

29. RELATED PARTY TRANSACTIONS:

All related party transactions or arrangements entered into by the company during the financial year were on an arm's length basis and were in the ordinary course of business. In Compliance with the provisions of the Act and Regulation 23(2) of the SEBI Regulations, 2015, all related party transactions had been placed before the Audit Committee for prior approval.

Pursuant to Section 134(3) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 information pertaining to related parties are given in Form AOC-2 as Annexure-7 of the report.

30. WHISTLE BLOWER POLICY/VIGIL MECHANISIM:

In compliance with provisions of Section 177 of the Act read with Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors of the Company has constituted Vigil Mechanism/Whistle Blower Policy for Directors, employees and vendors of the Company. The Whistle Blower Policy enables the Directors, employees and vendors to report concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or ethics Policy, thereby ensuring that the activities of the Company are conducted in a fair and transparent manner. The said policy is available at the Company's website at www.panasoniccarbon.in.

We further affirm that no employee has been denied access to the audit committee during the year 202526.

31. STATUTORY AUDITORS:

M/s. BSR & Co. LLP, Chartered Accountants (Firm Registration No.101248W/W-100022) allotted by the Institute of Chartered Accountants of India (ICAI) were re-appointed as the Statutory Auditors of the Company at the 40th Annual General Meeting of the Company held on 29^th June 2022 to hold office for a second term of five years till the conclusion of 45th Annual General Meeting of the Company. The Board was authorized to fix such remuneration as may be recommended by the Audit Committee in consultation with the Auditors.

Accordingly, no resolution is being proposed for ratification of appointment of statutory auditors at the ensuing AGM and the remuneration for the financial year 2025-26 is as per notes to the financial statement 27 (i).

There are no qualifications or adverse remarks in the Auditors' Report which require any clarification/ explanation. The Notes to financial statements are self-explanatory and needs no further explanation

32. COST AUDITORS:

In terms of Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audits) rules, 2014, as amended, Carbon Rods manufactured by your Company are not covered under the ambit of mandatory cost audit.

33. INDEPENDENT DIRECTORS:

Pursuant to the provisions of Section 149 of the Act, the independent directors have submitted declarations that each of them meet 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 Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"). There has been no change in the circumstances affecting their status as independent directors of the Company.

Whenever, new Non-executive and Independent Directors are inducted in the Board they are introduced to our Company's culture through appropriate orientation session and they are also introduced to our organization structure, our business, constitution, board procedures, our major risks and management strategy.

The Independent Directors of the Company met during the year on 12th February 2026 to review the performance of Non- Independent Directors and the Board as a whole. They assessed the quality, quantity and timeliness of flow of information between the Company management and the Board.

During the year under review, the non-executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, Commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company.

34. RISK MANAGEMENT:

As per Regulation 21 of SEBI (LODR) Regulations, 2015, amendments regulation with effect from 10/01/2020, the provisions of this regulation shall be applicable to top 1000 listed entities, determined on the basis of market capitalization, as at the end of the immediate previous financial year. Hence it is not applicable to us since we are not falling under the category of top 1000 listed entities.

However, in the Board of Directors' Meeting discussed about the elements of risk in different areas of operations and to develop various suitable actions associated to mitigate the risks.

35. SHARES:

a. BUY BACK OF SECURITIES

The Company has not bought back any of its securities during the financial year 2025-26

b. SWEAT EQUITY

The Company has not issued any Sweat Equity Shares during the financial year 2025-26

c. BONUS SHARES

No Bonus Shares were issued during the financial year 2025-26

d. EMPLOYEES STOCK OPTION PLAN

The Company has not provided any Stock Option Scheme to the employees during the financial year 2025-26

36. INFORMATION ABOUT HOLDING / SUBSIDIARY/ JV/ ASSOCIATE COMPANY:

Your Company continues to be the subsidiary of M/s. Panasonic Holdings Corporation, Japan and the Company does not have any Subsidiary, Joint Venture or Associate Company

37. OTHER DISCLOSURES:

a) No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

b) There was no change in the nature of business during FY 2025-26

c) No significant material orders were passed by the regulators or court during the financial year

which would have impacted the going concern status of the Company's operation in the future. There is no such fraud required to be reported under section 143(12) of the Companies Act, 2013.

d) There is no such fraud required to be reported under section 143(12) of the Companies Act,2013.

e) The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

f) The Company has duly filed its annual return for the 43rd Annual General Meeting (AGM) held on 26 June 2025 within the prescribed time limits. Form MGT-7 was filed on 25 August 2025. The annual return is available on the Company's website at: https:// www.panasoniccarbon.in/pdf/Annual%20 return/2025.pdf (panasoniccarbon.in)

38. CAUTIONARY STATEMENT:

The cautionary Statement in this Report, more particularly those which relate to Management Discussion and Analysis as explained in the Directors Report, describing the Company's business overview, projections, operational performances, estimates and expectations may constitute 'forward looking statements' within the meaning of applicable laws and regulations. Actual results might differ materially

from those either expressed or implied in the statement depending on the circumstances.

39. ACKNOWLEDGEMENT:

Your Directors wish to record their sincere appreciation for the support, co-operation, guidance and assistance provided by the Foreign Collaborators,

M/s. Panasonic Holdings Corporation, Japan. Your Directors thank the valued Customers for their patronage, the Suppliers for their timely and quality supply, the Shareholders for the confidence reposed and the Bankers, State and Central Governments for extending their invaluable support.

Your Directors place on record their appreciation of the dedicated services of the employees of the Company at all levels for the growth of the Company.

Your Directors are especially thankful to the esteemed Shareholders for their continued encouragement and support