Your Directors are pleased to present the 40^th Annual Report of the Company together with the audited financial statements for
the year ended March 31, 2025.

FINANCIAL RESULT

BUSINESS OPERATIONS

The net revenue from operations for the financial year ended
March 31, 2025 is Rs. 3367.57 Crores as against Rs.
3070.57 Crores in the previous financial year. The Net Profit
before Tax is Rs. 203.45 Crores as compared to Rs. 140.70
Crores in the previous financial year.

The Indian automobile industry is witnessing robust growth,
propelled by rising disposable incomes, rapid urbanization,
and supportive government initiatives focused on sustainable
mobility. This momentum is expected to persist, with the
sector projected to grow consistently in next 2~3 years.

Technological innovation is at the forefront of industry
transformation. Automakers are increasingly adopting advanced
technologies such as connected vehicles, autonomous
driving, and advanced driver-assistance systems (ADAS).
The shift toward electric vehicles (EVs) is accelerating, with
EVs now accounting for over 6% of total two-wheeler sales,
and several new battery electric vehicles (BEVs) launched
in 2025. Local component manufacturers are focusing on
indigenizing advanced parts like electric motors and automatic
transmissions to reduce import dependence.

The company remains committed to developing new products
using cutting-edge technology to stay future-ready. All thermal
solutions are meticulously designed to meet the evolving needs
of customers across mobility sectors. Improving operational
efficiency, product quality, and supply chain effectiveness
continues to be a strategic priority and will remain a key driver
of competitiveness going forward.

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

EXTERNAL ENVIRONMENT AND ECONOMIC OUTLOOK

In FY 2024-25, India’s external environment saw a mixed
bag of challenges and opportunities. While the economy

exhibited resilience, with GDP growth projected at 6.4%,
global uncertainties like the Red Sea crisis and geopolitical
tensions impacted trade and investment flows. Despite these
headwinds, India’s foreign exchange reserves remained robust,
and FDI inflows showed a revival.

The Indian automobile industry continued its growth
trajectory, driven by healthy demand, infrastructure
investments, and government policies supporting sustainable
mobility. Domestic sales increased by 7.3%, and exports
rose significantly by 19.2%.India’s automobile industry saw
a strong performance, with passenger vehicle sales reaching
a record high of 4.3 million units. This growth was primarily
driven by the utility vehicle segment, which accounted for
65% of total passenger vehicle sales. There has been a
clear and continuous shift in consumer preference from car
segment to SUV segment, with SUVs share going up from
49% (FY 2022-23).

The Indian automobile industry is poised for strong growth,
driven by increasing demand, government initiatives, and
a shift towards electric vehicles. The government’s push
for EV adoption and increasing consumer awareness are
expected to fuel the growth of the EV segment, with EVs
potentially accounting for a significant share of the market
by 2030. Initiatives like the AMP 26, scrappage policy, and
production-linked incentive scheme are expected to boost the
industry’s growth and competitiveness. India has the potential
to become a global hub for automotive manufacturing and
innovation, with increasing exports and investments from
international companies.

The industry is focusing on developing and adopting new
technologies, such as connected vehicles, autonomous driving,
and advanced driver-assistance systems. The industry is also
prioritizing sustainability, with increasing focus on reducing
emissions and adopting eco-friendly technologies.

The Company continues to remain watchful of possible
impact of changes in interest rates, vehicle prices, volatile
geopolitical situation impacting economic & supply chain
situations on end consumer & OEM demand. The BEV/
Hybrid/CNG (alternate fuel) vehicle penetration continues
to increase due to Govt. push through various regulations
& schemes and also increase in customer acceptability for
clean or alternate fuel vehicles. Govt AC Mandate for Goods
carrier (N2 & N3 category) will have immediate positive
impact on our performance of FY 2025-26. Strong Order
book for Railway Business will be a key driver for our top
line as well as bottom line. The Company is also focused to
develop segments like Bus AC with more variety of products
and also EV AC kits. With a well-diversified thermal solution
portfolio and strong manufacturing presence, export remains
another focus area for the organization.

EXPANSION AND FUTURE PROSPECTS

The Company has increased its capacity in existing plant
locations to meet the increasing customer demand. The
Company has also sanctioned to setup green field project
at Kharkhoda (Haryana). The Company has also introduced
products for Railway Business, Goods Carrier vehicle (trucks),
Hybrid & Electric Vehicle in FY 2024-25 and will continue to
introduce more such products in coming years as per customer/
market requirements. Localization and cost optimization
activities across all product segments to marginalize impact
of global economic factors remains one of the core focus for
operations team.

There is capacity & product optimization and enhancement
plan with focus on Make in India along with increased local
manufacturing to ensure sufficient capacity is available for
all customers across locations in line with growing market
demand across all the segments.

Subros’ continuous investment to enhance design capability
as we move forward, has ensured that the organization is
ready to meet future customer demands in-line with Govt.
regulations with strong focus on long term technology
development. Currently, active work is being done for various
OEMs of diverse vehicle application for Indian as well as
Global Requirements. The long term growth prospects for the
Company’s product remains robust with passenger vehicle
industry production likely to touch 7 million vehicles by
2030.

DIVIDEND

Your Company has earned a net profit (after tax) of Rs. 150.39
Crores as against Rs. 97.66 Crores in the previous year. The
Board has recommended a dividend of Rs. 2.60 per share
(130% on the face value of equity shares of Rs. 2 each) for
the financial year ended March 31, 2025, as against Rs. 1.80
per share (90% on the face value of equity shares of Rs. 2
each) in the previous year.

The dividend, if approved by the Members at the ensuing
Annual General Meeting (AGM), shall absorb a sum of Rs.
16.96 Crores.

The Dividend Distribution Policy of the Company is available

on the Company’s website at https://www.subros.com/investors/
policies.

TRANSFER TO RESERVES

Your Company proposes to transfer Rs. 1.50 Crores to the
General Reserve.

MATERIAL CHANGES AND COMMITMENTS AFFECTING
FINANCIAL POSITION BETWEEN THE END OF THE
FINANCIAL YEAR AND DATE OF THE REPORT

There were no material changes and commitments that affect
the financial position of the Company subsequent to the date
of financial statement.

CAPITAL STRUCTURE

During the year there is no change in the Capital Structure of
your Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review the following changes took place
in the Board and Key Managerial Personnel of your Company:

i. Mr. Parmod Kumar Duggal was re-appointed as the
Whole-time Director designated as Executive Director &
Chief Executive Officer of the Company for a period of 3
years with effect from 5^th August, 2024.

ii. Ms. Shradha Suri was re-appointed as Chairperson &
Managing Director of the Company for a period of 3 years
with effect from 12^th May, 2025.

iii. Mr. Naohisa Kuriyama, Nominee Director has resigned
due to change in nomination of M/s DENSO Corporation,
Japan with effect from 28^th March, 2025.

iv. Dr. Yasuhiro lida, Alternate Director to Mr. Naohisa
Kuriyama has been vacated due to the resignation of Mr.
Naohisa Kuriyama, the Original Director with effect from
28^th March, 2025.

v. Mr. Yusuke Hara, appointed as Nominee Director of M/s
DENSO Corporation, Japan with effect from 28^th March,
2025.

vi. Dr. Yasuhiro lida, appointed as Alternate Director to Mr.
Yusuke Hara, the Original Director with effect from 28^th
March, 2025.

Pursuant to the provisions of Section 152, other applicable
provisions of the Companies Act, 2013 and Articles
of Association of the Company, Mr. Hisashi Takeuchi
(DIN: 07806180) Director of the Company retires by rotation
at the ensuing AGM and being eligible, offers himself for re¬
appointment.

His brief resume as required under the Listing Regulations
and Secretarial Standards is provided in the Notice of the
40^th AGM of the Company. The requisite resolution pertaining
to the re-appointment appears at the respective item of the
Notice along with the Statement and is recommended to the
Members for approval.

Declaration from Independent Directors:

The Company has received declaration(s) from all the
Independent Director(s) of the Company as laid down under

Section 149(7) of the Companies Act, 2013 read with Rule 6
of the Companies (Appointment and Qualification of Directors),
2014 along with Regulation 16 and Regulation 26 of the
listing Regulations, confirming that they meet the criteria as
laid down under Section 149(6) of the Companies Act, 2013
and the Listing Regulations.

Board Meeting:

The Board of Directors met five times during the financial
year 2024-25, the details of which are given in the Corporate
Governance Report which forms part of this Annual Report.
The intervening gap between any two meetings was within the
period prescribed under the Companies Act, 2013.

COMMITTEES OF THE BOARD

The Board has Committees i.e Audit Committee, Nomination
& Remuneration Committee, Stakeholders Relationship
Committee, Corporate Social Responsibility Committee and
Risk Management Committee. The Composition, terms of
reference and number of meetings of the Board Committees is
described in Corporate Governance Report as stipulated under
Listing Regulations, which forms integral part of this Report.

Policy on Directors’ Appointment and Remuneration: The

policy of the Company on Directors’ and Senior Management
appointment and remuneration including criteria for
determining qualification, positive attributes and other matters
is available on the website https://www.subros.com/investors/
policies of the Company.

ANNUAL RETURN

The Annual Return as on March 31, 2025, in terms of
provisions of Section 134(3) and other applicable provisions of
the Companies Act, 2013, read with Rules thereto is available
on website of the Company https://www.subros.com/investors/
annual-returns and forms integral part of this Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

As required under Section 134 (5) of the Companies Act,
2013, your Directors hereby confirm that:

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

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
at the end of the financial year and of the profit and loss
of the Company for that period;

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

d) 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; and

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.

SUBSIDIARIES AND JOINT VENTURES

DENSO Subros Thermal Engineering Centre India Private
Limited, a Joint Venture, achieved revenue of Rs. 17.95
Crores during the FY 2024-25 as against Rs. 17.48 Crores
in the previous year. The Joint Venture achieved a profit of
Rs. 0.75 Crores during the year as against Rs. 0.31 Crores
increased by 141.94%. Your Company is holding 26% shares
in this Joint Venture.

The Company does not have any subsidiary.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Companies Act, 2013 and IND AS
110 - Consolidated Financial Statements read with IND AS
31 - Interest in Joint Ventures, your Directors have pleasure
in attaching the Audited Consolidated Financial Statements,
which forms a part of this Annual Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information in terms of Section 134(3)(m) of the
Companies Act, 2013, read with Rule 8(3) of the Company
(Accounts) Rules, 2014 relevant rules is annexed herewith as
Annexure-1 and forms integral part of this report.

AUDITORS AND AUDITORS’ REPORT

Statutory Auditors: As per the provisions of Section 139 of
the Companies Act, 2013, the shareholders have approved
the re-appointment of M/s Price Waterhouse Chartered
Accountants LLP, as Statutory Auditors of the Company for
the second term of five consecutive years from the conclusion
of the 37^th Annual General Meeting till the conclusion of 42^nd
Annual General Meeting.

The Auditors’ Report to the Members for the year under review
does not contain any qualification, reservation or adverse
remark. The observations of the Auditors and the relevant
notes on accounts are self-explanatory and therefore do not
call for any further comments.

Cost Auditors: The Company has re-appointed M/s. Chandra
Wadhwa & Company, Cost Accountants, as Cost Auditors of
the Company to conduct the audit of cost records maintained
by the Company for the FY 2025-26 in accordance with
Section 148(1) of the Companies Act 2013. The ratification
of remuneration payable to Cost Auditors for the FY 2025¬
26 is being sought from the Members of the Company at the
ensuing AGM.

Secretarial Auditors: As per the provisions of Regulation
24A of the SEBI Listing Regulations, and Section 204 of the
Act and on the basis of Audit Committee recommendation,
the Board of Directors approves and recommends for
shareholders’ approval for the appointment of M/s RSM &
Co., (Firm Registration No P1997DE017000). The Company
has appointed M/s. RSM & Co., Company Secretaries as

Secretarial Auditors to conduct the audit of secretarial and
related records of the Company for the first term of Five Years
from 01.04.2025 to 31.03.2030.

The Secretarial Audit Report for the financial year ended
March 31, 2025 is annexed as Annexure-2 and the same is
self-explanatory. The said Secretarial Audit Report does not
contain any qualification, reservation or adverse remark.

The Statutory Auditors, Cost Auditors or Secretarial Auditors
have not reported any frauds during the Financial Year 2024-25
under Section 143(12) of the Companies Act, 2013 and rules
made thereunder.

DEPOSITS

During the year under review, your Company has neither
invited nor accepted any deposits from the Public.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE
REGULATORS

No significant material order was passed by the Regulators or
Courts or Tribunals impacting the going concern status and
Company’s operations in future.

INTERNAL FINANCIAL CONTROLS

The adequacy of Internal Financial Controls is discussed in
Management Discussion and Analysis, as stipulated under the
Listing Regulations with the Stock Exchanges, which forms
part of this Report.

LOANS, GUARANTEES OR INVESTMENTS

The Company has not given any inter- corporate loans and/or
provided any guarantees. Details related to the investments
made by the Company are given in Note 5(a),(b)&(c) to the
Standalone Financial Statements of the Company.

There is no proceeding pending under the Insolvency and
Bankruptcy Code, 2016. There was no instance of one time
settlement with any Bank or Financial Institution(s).

CORPORATE SOCIAL RESPONSIBILITY

The Company has formulated a Corporate Social Responsibility
(CSR) Policy to undertake CSR initiatives as specified in
Schedule VII of the Companies Act, 2013. The Company has
constituted a robust and transparent governance structure
to oversee the implementation of CSR Policy, in compliance
with the requirements of Section 135 of the Companies Act,
2013. The Annual Report on CSR activities is annexed as
Annexure-3 and forms integral part of this report. This Policy
is placed on the website of the Company https://www.subros.
com/zip/CSR%20Policy.pdf.

RISK MANAGEMENT

The Company has robust Risk Management framework
in place which is aligned with ISO 31000: 2018 Risk
Standard. Company’s Risk Management policy is defined
and reviewed periodically. ERM framework has detailed
the process of Risk Identification, analysis, evaluation and
treatment. ERM framework is certified after conducting
audits by the external accredited agencies. Every year audits
are done to review the appropriateness of the deployment
of ERM framework in the organization and participation of

the functional team.

Every year Company carries the Bench marking exercise by
referring to the external agency reports and analyzing the
risks identified by OEM / industry peers which enable us
to stay ahead of curve. The risk management process and
structure ensure the identification & mitigation of Strategic,
Operational, Financial & Regulatory risk(s). The Risk
Registers and mitigation action implementation is reviewed
at fixed frequency by the management and commitments to
resource allocation ensure that risk management remains a
priority. The Risk Management Committee also review the
progress of Risk identified & its mitigation plan on half yearly
basis.

The Company is working to create a Risk averse and Opportunity
focused culture that promotes principled decision making to
establish acceptable risk Levels in the organization.

VIGIL MECHANISM

Pursuant to Section 177(9) of the Companies Act, 2013, the
Company has established a Vigil Mechanism/ Whistle Blower
Policy for directors, employees, suppliers, contractors and
other stakeholders of the Company. The purpose and objective
of this Policy is to cover serious concerns, unethical behavior,
actual or suspected fraud that would have a larger impact on
image and values of the Company due to incorrect financial
reporting or improper conduct. The Whistle Blower Policy
has been placed on the website of the Company https://www.
subros.com/zip/Whistle%20Blower%20Policv.pdf

SEXUAL HARASSMENT

The Company has in place a Sexual Harassment Policy in line
with the requirements of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Internal Committee has been set up to redress complaints
received regarding sexual harassment. During the year the
Company did not receive any complaint.

RELATED PARTY TRANSACTIONS

The Board of Directors has formulated a Related Party
Transaction Policy for determining material related party
transactions. The Related Party Transaction Policy is available
on the website of the Company https://www.subros.com/zip/
Related%20Partv%20Transaction%20Policv.pdf. A statement
of all particulars of Contracts or Arrangements with material
related parties referred to in Section 188(1) of the Companies
Act, 2013, is annexed as Annexure-4 and forms integral part
of this report.

LISTING

The Equity Shares of your Company continue to be listed on
BSE Limited (BSE) and the National Stock Exchange of India
Limited (NSE). The listing fees for the financial year 2025-26
have been paid to the said stock exchanges.

ANNUAL EVALUATION

In compliance with the provisions of the Companies Act,
2013, Listing Regulations and Guidance Note issued by SEBI
the Board has formulated a framework, inter alia, for formal
evaluation of its performance and effective functioning of its

committees and the Board of Directors.

In this regard the Board has, inter alia, carried out an
annual evaluation of the performance of all the independent
director(s). The Nomination & Remuneration Committee
(“NRC”), inter alia, reviewed the performance of every
directors and the Board as a whole and its committee(s).
The Independent Directors, inter alia, reviewed performance
of non-independent directors, the Board as a whole and its
committees and assessed the quality, quantity and timeliness
of flow of information between the Company’s management
and the Board.

The evaluation criteria of the performance of every
director, Board & its committees included, inter alia, their
structure/ composition, meeting availability and attendance,
commitment, contribution, integrity, ability to function as
a team, expertise drawn from diverse domains banking,
administration, strategic and technical and bring specific
knowledge & competencies relevant to the Company’s
business. The Board members participation and overall
functioning was quite satisfactory and effective during the
year under review. There are no specific observations on the
Board evaluation carried out during the year as well as for
the previous year.

CREDIT RATING

ICRA assigned the Long Term Ratings as [ICRA] AA “Stable”
and the Short Term Ratings as [ICRA] A1 “Positive”.

PARTICULARS OF EMPLOYEES AND RELATED
DISCLOSURES

Disclosure in respect to remuneration and other details as
per the provisions of Section 197(12) of the Companies
Act, 2013 read with Rule 5(2) and 5(3) of the Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014 are provided in the Annexure-5 to this Report
having regard to the provisions of the second proviso to
Section 136(1) of the Companies Act, 2013, the Annual
Report excluding the said statement of employees under
Section 197(12) of Companies Act, 2013 is being sent to the
Members of the Company. The said information is available
for inspection at the registered office of the Company during
working hours and any Member interested in obtaining
said statement may write to the Company Secretary at the
registered office of the Company.

CORPORATE GOVERNANCE AND SHAREHOLDERS
INFORMATION

The Company is committed to maintain the highest standards
of corporate governance. The Company has complied with the
corporate governance requirements, as stipulated under the
Listing Regulations. A report on Corporate Governance along
with a Certificate from the Practicing Company Secretaries
regarding compliance on the conditions of corporate
governance prescribed under Listing Regulations is annexed
herewith and forms integral part of this Report. All Policies
of the Company are available on the website of the Company
https://www.subros.com/investors/policies.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis, as required
in terms of Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015
is annexed to this Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT

A report on adoption of responsible business practices in
the interest of the social, governance and environmental
perspective are as vital as their financial and operational
performance, conforming to the requirements of the clause
(f) of sub-regulation (2) of Regulation 34 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015, the Business Responsibility and Sustainability Report
for Financial Year 2024-25 is annexed herewith and forms
integral part of this Report.

INVESTOR EDUCATION AND PROTECTION FUND

The disclosure of IEPF related activities during the year under
review forms a part of the report on Corporate Governance.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with all the mandatorily applicable
Secretarial Standards issued by the Institute of Company
Secretaries of India on meetings of Board of Directors, its
Committee(s) and General Meetings.

ACKNOWLEDGMENT

The Board extends heartfelt gratitude to the Company’s valued
customers, Maruti Suzuki India Limited, Tata Motors Limited,
Mahindra & Mahindra Limited, Ashok Leyland Limited, Force
Motors Limited, Renault Nissan Automotive India Private
Limited and many more, for the trust and confidence reposed
by them in the Management for their co-operation and support
provided to the Company.

The Board acknowledge cooperation and support of the
supplier base, vendors and Company’s bankers HDFC Bank,
ICICI Bank, State Bank of India, Kotak Mahindra Bank & other
Banks and our collaborators, DENSO Corporation, Japan and
Suzuki Motor Corporation, Japan for their continued support.

The Board conveys appreciation to all the Company’s
employees for their hard work, support and commitment
towards the achievement of the performance and overall
growth of the Company.

Last but not the least, the Board wishes to thank all the
shareholders, business associates and other stakeholders
for their long association during the growth journey of the
Company.

For and on behalf of the Board of Directors

SHRADHA SURI

Chairperson & Managing Director
(DIN: 00176902)

Place: New Delhi
Dated: May 22, 2025