Your Directors have pleasure in presenting the 41^st Annual Report together with the audited financial statements for the
financial year ended March 31, 2026.

FINANCIAL RESULTS

COMPANY’S PERFORMANCE

The net revenue from operations for the financial year
ended March 31, 2026 stands at Rs. 3755.52 Crores as
against Rs. 3,367.57 Crores in the previous financial year,
reflecting a growth of 11.52%. Profit before Tax (PBT) is
Rs. 220.29 Crores compared to Rs. 203.45 Crores in the
previous year.

The Indian automotive industry continues to evolve
with strong underlying fundamentals. Demand recovery
particularly in rural markets, signals improving economic
activity and consumer confidence. At the same time, the
passenger vehicle segment is witnessing a clear shift
towards premiumization, with increasing adoption of
feature rich, technology enabled vehicles, driving higher
value per unit.

The commercial vehicle segment is adapting to tighter emission
regulations and efficiency norms, reinforcing the need for
continuous innovation and cost competitiveness across the value
chain.

The transition towards electric mobility is progressing
steadily. While adoption is gaining traction across segments
more pronounced in two-wheelers charging infrastructure
and total cost economics remain key enablers for accelerated
growth. In parallel, the industry is witnessing a strong
push towards localization of critical components, including
battery technologies and power electronics, aimed at
building a robust domestic ecosystem and reducing import
dependence.

Technology is becoming the cornerstone of competitive
differentiation. Increasing integration of connected systems,
advanced driver-assistance systems (ADAS), and energy-
efficient solutions is reshaping product development
priorities across the industry.

In this environment, the Company remains firmly focused
on technology leadership and customer-centric innovation.
Our thermal management solutions are aligned with the
evolving requirements of internal combustion, hybrid, and
electric platforms. The Company continue to strengthen
it’s capabilities in product development, manufacturing
excellence, and supply chain resilience.

Going forward, the Company’s strategic priorities remain
clear drive innovation, deepen localization, enhance
operational efficiency, and deliver consistent value to
customers and stakeholders. These will continue to be the
key pillars of it’s competitiveness and long-term growth.

INDIA AS A FUTURE AUTOMOTIVE HUB

India is steadily emerging as a global hub for automotive
manufacturing and research & development, supported by
its scale, cost competitiveness, and evolving technology
capabilities. The country is already the largest producer of
two-wheelers, the second-largest producer of buses, and
the third-largest producer of medium and heavy commercial
vehicles globally.

Looking ahead, India is expected to significantly enhance
its manufacturing capacity, with an estimated addition
of nearly 4 million passenger vehicles by 2032. Industry

projections indicate that passenger vehicle volumes could
grow from approximately 4.5 million units to 7 million
units by 2030, while the commercial vehicle segment is
expected to reach around 1.5 million units. This growth
trajectory will further reinforce India’s position as the third-
largest passenger vehicle market in the world.

A defining feature of this growth is the sustained dominance
of the SUV segment, which continues to shape production
strategies and competitive dynamics across OEMs. The
strong preference for SUVs and premium vehicles has
contributed to robust retail momentum, with the industry
witnessing significant year-on-year growth, underscoring its
resilience and long-term potential.

EXTERNAL ENVIRONMENT AND ECONOMIC OUTLOOK

The Indian passenger vehicle market remains highly
consolidated, with a few leading OEMs accounting for a
dominant share of industry volumes. Companies such as
Maruti Suzuki, Hyundai Motor India, Tata Motors, Toyota
Kirloskar Motor, and Mahindra & Mahindra collectively
command a substantial portion of the market, driving scale
efficiencies and structured supplier ecosystems. Among
these, Maruti Suzuki continues to hold a leadership position
with a significant market share.

At the same time, many Indian automotive home grown
companies are strengthening their global footprint across
regions including Africa, Middle East, and Asia. The market
has also proven challenging for several global entrants such
as Ford Motor Company and Stellantis, highlighting the
importance of localization, scale, and cost competitiveness.

Key growth drivers continue to include the rise of premium
lifestyle mobility, increasing SUV penetration, and higher
adoption of feature-rich vehicles. In parallel, the expansion
of alternative powertrain ecosystems, particularly electric
mobility, is reshaping the industry landscape. The
development of electric drivetrain components, battery
ecosystems, and fast-charging infrastructure is gaining pace,
supported by policy initiatives and industry investments.
While heavy-duty mobility continues to rely on advanced
diesel technologies, electric adoption in light commercial
vehicles and urban mobility segments is witnessing steady
growth.

Consumer behaviour is also evolving, with increasing
emphasis on safety, connectivity, and overall driving
experience. The adoption of shared mobility solutions and
digital platforms is influencing vehicle utilization patterns,
particularly in urban markets.

Overall, the Indian automotive sector is undergoing a structural
transformation, driven by premiumization, electrification,
regulatory evolution, and infrastructure expansion. Rising
disposable incomes, supportive government policies, and
the ambition to position India as a global EV manufacturing
hub are further accelerating this transition. The growing
localization of high-value components such as electronics
and battery cells is strengthening the domestic supply

chain and reducing external dependencies.

EXPANSION AND FUTURE PROSPECTS

In line with evolving market requirements, the Company
continues to proactively assess and enhance its product-
wise capacity across manufacturing locations. The
greenfield project at Kharkhoda (Haryana) represents
a significant milestone and is expected to commence
commercial production in Q2 of financial year 2026-27.

The Company is also expanding its presence in future
mobility solutions through capacity addition at Karsanpura,
Gujarat, 400,000 units per annum for electric compressors
catering to EV applications, with an investment of around
Rs. 175 Crores (approx). Additionally, capacity expansion
of approximately 500,000 units per annum for ICE
compressors is being undertaken with an investment of
around Rs. 90 Crores (approx).

A strong focus is being placed on localization and backward
integration, including the development of domestic vendor
ecosystems, to reduce import dependence, optimize costs,
and enhance supply chain resilience. These initiatives are
aligned with broader industry efforts towards indigenization
and self-reliance.

The Company continues to invest in strengthening its
design and engineering capabilities to address evolving
customer requirements across both domestic and global
markets. Active development programs are underway with
leading OEMs across diverse vehicle segments, positioning
the Company as a technology-driven partner.

Looking ahead, the long-term outlook remains robust, with
passenger vehicle production in India expected to approach
7 million units by 2030. In addition to domestic growth, the
Company is increasingly focusing on expanding its export
footprint, leveraging its technological capabilities and cost
competitiveness to serve global markets.

The Company remains committed to driving innovation,
enhancing operational excellence, and building a future-
ready product portfolio aligned with emerging mobility
trends, thereby ensuring sustainable growth and long-term
value creation.

DIVIDEND

Your Company has earned a net profit (after tax) of Rs.
165.78 Crores as against Rs. 150.39 Crores in the previous
year. The Board has recommended a dividend of Rs. 3/-
per share 150% on the face value of equity shares of Rs.
2 each) for the financial year ended March 31, 2026, as
against Rs. 2.60 per share (130% 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.19.57 Crores.

The Dividend Distribution Policy of the Company is
available on the Company’s website athttps://www.subros.

com/investors/policies,

TRANSFER TO RESERVES

Your Company proposes to transfer Rs, 1,50 Crores to the
General Reserve out of the Profits available for appropriation.

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

There are no material changes and commitments affecting
the financial position of the Company between the end of
financial year and date of this Report.

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, Yusuke Hara, Nominee Director has resigned due
to change in nomination by M/s DENSO Corporation,
Japan with effect from 30^th January, 2026,

ii) Dr, Yasuhiro lida, Alternate Director to Mr, Yusuke Hara
has been vacated due to the resignation of Mr, Yusuke
Hara, the Original Director with effect from 30^th January,
2026,

iii) Mr, Naohisa Kuriyama, appointed as Nominee
Director of M/s DENSO Corporation, Japan with
effect from 30^th January, 2026,

iv) Mr, Tsunenobu Hori, appointed as Alternate Director
to Mr, Naohisa Kuriyama, the Original Director with
effect from 30^th January, 2026,

v) Dr, Jyotsna Suri is completing the age of 75 years
on 20^th July, 2027, therefore, a special resolution is
proposed at the ensuring annual general meeting,

In accordance with the provisions of Section 152 other
applicable provisions of the Companies Act, 2013 and
Articles of Association of the Company, Mr, Tomoaki
Yoshimori (DIN:08981304) Director of the Company
retires by rotation at the ensuing AGM and being eligible,
offers himself for re-appointment,

The brief resume of Dr, Jyotsna Suri and Mr. Tomoaki
Yoshimori are provided in the Notice of the 41^st AGM of the
Company, The requisite resolution(s) of the respective items
along with the explanatory statements are 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 2025-26, 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/poficies of the Company,

ANNUAL RETURN

The Annual Return as on March 31, 2026, 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) such accounting policies have been selected 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) 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) annual accounts have been prepared on a going
concern basis;

e) internal financial controls were followed by the
Company and that such internal financial controls are
adequate and were operating effectively; and

f) proper systems have been devised 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.19.76
Crores during the Financial Year 2025-26 as against
Rs. 17.95 Crores in the previous year. The Joint Venture
achieved a profit of Rs. 0.20 Crores during the year as
against Rs. 0.75 Crores reduced by 73.33%. Your Company
is holding 26% shares in this Joint Venture.

During the year, your Company has made investments of
Rs. 99.76 Lakhs and subscribed 9,97,600 equity shares
of Rs. 10 each in the share capital of Ampin C&I Power
Five Private Limited, a special purpose vehicle (SPV)
incorporated with the object of generation of solar power
upto capacity of 2.8 MW for Manesar Plant. Your Company
is holding 26% shares in this SPV.

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

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 forming 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.

In terms of the Circular dated 7^th January, 2026 issued
by the National Financial Reporting Authority the Company
has formed a TCWG (Those Charged with Governance) for
effective communication with Statutory Auditors.

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 financial year 2026¬
27 in accordance with Section 148(1) of the Companies
Act 2013. The ratification of remuneration payable to Cost
Auditors for the Financial Year 2026-27 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 Companies Act, 2013, the shareholders have approved
the appointment of M/s RSM & Co., Company Secretaries
as Secretarial Auditors of the Company for the first term of
five years from 1.4.2025 to 31.3.2030.

The Secretarial Audit Report for the financial year ended
March 31, 2026 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
2025-26 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.

MATERNITY BENEFITS

The Company has complied with the requirements of
Maternity Benefit Act, 1961.

CORPORATE SOCIAL RESPONSIBILITY

The Company has a Corporate Social Responsibility
(CSR) Policy to undertake CSR initiatives as specified in

Schedule VII of the Companies Act, 2013 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. The
CSR Policy is placed on the website of the Companyhttps://
www.subros.com/zip/CSR%20Policy.pdf.

RISK MANAGEMENT

The Company has a Risk Management Policy in terms
of SEBI Regulations and the ERM Policy is placed on
the website of the Company. The Company also has risk
management framework in place aligned to ISO 31000:
2018 Risk Standard and duly certified by the external
accredited agencies. ERM framework comprises risk
identification, analysis, evaluation and treatment of the
risks. Every year ERM activities is reviewed with all the
functional teams in the organization.

The Company carries the bench marking exercise every year
by referring to the external agency reports, OEM / industry
peers based on the benchmarking the Company finalize top
10 risks of the organization cascading down to functional
levels. The risk management process and structure ensure
the identification and mitigation of strategic, operational,
financial and regulatory risk. The identified risks and it’s
mitigation action is being reviewed periodically by the
management. The Risk Management Committee comprising
of the Board Members also reviews 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.

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 has not received any such complaint.

RELATED PARTY TRANSACTIONS

The Board of Directors has formulated a Related Party
Transaction Policy for determining material related party
transactions and is available on the website of the Company.

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) and has listing fees for the financial
year 2026-27 has 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. 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 has assigned the Long Term Ratings as [ICRA] AA
“Stable” and reaffirmed 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 Companyhttps://www.subros.com/
investors/policies.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis, as required
in terms of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 forming the part of the
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 2025-26 forming part of the 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.

OTHER DISCLOSURE

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).

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, Daimler
India Commercial Vehicles; and many more, for the trust
and confidence reposed by them in the Management.

The Board acknowledge cooperation and support of the
supplier, 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, dedication, support and
commitment towards the achievement of the performance
and overall growth of the Company.

The Board also 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 DirectorsSHRADHA SURI

Chairperson & Managing Director
(DIN: 00176902)

Place: New Delhi
Dated: May 18, 2026