Your Directors are pleased to present the Thirty-Ninth Annual Report together with the Audited Financial
Statements of the Company for the financial year ended 31 March 2026.

FINANCIAL RESULTS

The financial statements of the Company have been prepared in accordance with the Indian Accounting
Standards (Ind AS) notified under Section 133 of the Companies Act, 2013, read with the Companies (Indian
Accounting Standards) Rules, 2015.

A summary of the standalone and consolidated financial performance of the Company for the financial year
ended 31 March 2026 is given below:

There have been no significant changes or commitments affecting the financial position of the Company
between the end of the financial year and the date of this Report.

RESULTS OF OPERATIONS

Sales

During the year under review, the standalone
revenue from operations was INR 2,921.36 million,
as compared to INR 2,864.66 million in the previous
year. The consolidated revenue from operations was
INR 3,325.99 million for the financial year ended 31
March 2026, as compared to INR 3,111.02 million in the
previous year.

Profitability

The Company reported standalone profit before tax of
INR 696.82 million, as compared to INR 417.60 million
in the previous year. The consolidated profit before tax
was INR 758.36 million for the financial year ended 31
March 2026, as compared to INR 395.71 million in the
previous year.

Earnings per share

The Earnings Per Share (EPS) on a standalone basis
was INR 61.24 for the year ended 31 March 2026, as
against INR 37.43 for the year ended 31 March 2025.
The EPS on a consolidated basis was INR 67.57 for the
year ended 31 March 2026, as against INR 33.89 for
the year ended 31 March 2025.

Transfer to Reserves

The Board of Directors has decided not to transfer any
amount to the reserves for the year under review.

Share Capital

The authorised equity share capital as on 31 March
2026 is INR 112 million and the paid-up equity share
capital as on 31 March 2026 stood at INR 85.07 million.

Net Worth

The Company's net worth on a standalone basis as on
31 March 2026 was INR 3,851.82 million, as compared
to INR 3,390.87 million as on 31 March 2025. The
Company's net worth on a consolidated basis as on 31
March 2026 was INR 3,602.35 million, as compared to
INR 3,142.55 million as on 31 March 2025.

DIVIDEND

Your Directors have recommended a dividend of INR 11
per equity share (110 %) on 8,506,865 equity shares of

INR 10 each, fully paid-up, for the financial year 2025¬
26, total amounting to INR 93.58 million. This dividend
is subject to the approval of the Members at the
ensuing Annual General Meeting (“AGM”) and will be
disbursed to those shareholders whose names appear
in the Register of Members as on the cut-off date.

The dividend pay-out ratio for the year stands at
18% of standalone profits, in line with the Company's
Dividend Distribution Policy. Further details of the
policy, formulated in accordance with Regulation
43A of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, as amended, are
available on the Company's website at
https://www.hester.in/corporate-governance

BORROWINGS

The Company's outstanding long-term borrowings on
a standalone basis stood at INR 504.99 million as on
31 March 2026, as compared to INR 756.26 million as
on 31 March 2025.

PARTICULARS OF LOANS, GUARANTEES
AND INVESTMENTS

Details of loans, guarantees and investments covered
under the provisions of Section 186 of the Companies
Act, 2013 are given in the notes to the Financial
Statements.

DIVESTMENT OF SUBSIDIARY

During the year under review, the Company sold/
transferred 43.81% of its shareholding in Texas
Lifesciences Private Limited, reducing its holding from
54.81% to 11%, pursuant to approval of the Board of
Directors at its meeting held on 11 March 2026. The
transaction was carried out in compliance with the
applicable provisions of the Companies Act, 2013
and the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and the necessary
disclosures were made to the stock exchanges.
Consequently, Texas Lifesciences Private Limited
ceased to be a subsidiary of the Company with effect
from 27 March 2026. The Company continues to hold
11% in the said entity as an investment.

In compliance with Ind AS 110, the Companies Act,
2013, Schedule III and the related Rules and the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Annual Report includes the
Audited Consolidated Financial Statements. These
statements present the combined financial position,
including resources, assets, liabilities, income, profits
and other details, of the Company, its subsidiaries,
after elimination of non-controlling interest and joint
venture entities as a single entity.

SUBSIDIARY COMPANIES

As of 31 March 2026, your Company has two
wholly-owned subsidiary companies, namely Hester
Biosciences Africa Limited and Hester Biosciences
Kenya Limited. In addition, the Company has one
subsidiary, Hester Biosciences Nepal Private Limited.
Furthermore, there is one step-down subsidiary
company, Hester Biosciences Tanzania Limited, which
is wholly-owned by Hester Biosciences Kenya Limited.

During the year under review, Texas Lifesciences
Private Limited ceased to be a subsidiary of the
Company by way of sale/ transfer of shares.

The business details of the subsidiary companies are
as follows:

Hester Biosciences Nepal Private Limited (HBNPL)

HBNPL is a subsidiary of Hester Biosciences Limited,
with a 65% stake in HBNPL. HBNPL is in the business
of manufacturing veterinary vaccines in Nepal.

Hester Biosciences Africa Limited (HBAL)

HBAL is a wholly owned subsidiary of Hester
Biosciences Limited in Tanzania. HBAL manufactures
and markets veterinary vaccines in Tanzania and other
African countries.

Hester Biosciences Kenya Limited (HBKL)

HBKL is a wholly owned subsidiary of Hester
Biosciences Limited in Kenya. HBKL is in the business
of trading of veterinary vaccines and animal health
products in Kenya.

Hester Biosciences Tanzania Limited (HBTL)

HBTL is a wholly owned subsidiary of HBKL in
Tanzania and step-down subsidiary of Hester
Biosciences Limited. HBTL is in the business of trading
veterinary vaccines and animal health products in
Tanzania and other African countries.

There have been no material changes in the nature of
the subsidiaries' business operations, as detailed in
the financial statements. During the year under review,
the Board diligently assessed the performance and
operations of these subsidiary companies.

In compliance with Section 136 of the Act, the
Balance Sheets, Profit and Loss Statements and other

relevant documents of the subsidiary companies
are not attached with the Company's Balance Sheet.
These statements are available to Members on
the Company's website. The consolidated financial
statements include the financial statements of the
subsidiaries and joint venture entity. The highlights are
given in this Board Report as Annexure 1, in the format
prescribed under Form AOC-1.

In accordance with Section 129(3) of the Companies
Act, 2013 and the related Rules, the Company has
provided a statement outlining the significant aspects
of the financial statements of its subsidiaries. The
policy on material subsidiaries, as approved by the
Board, is available on the Company's website at
https://www.hester.in/corporate-governance

JOINT VENTURE ENTITY

Thrishool Exim Limited (TEL) is a joint venture entity
operating in Tanzania, with Hester Biosciences
Limited holding a 50% stake. TEL is a reputable
supplier and distributor of a wide range of animal
health and nutrition products sourced from various
esteemed companies. Its diverse product range
includes veterinary feed additives, feed raw materials,
nutritional supplements, therapeutics and equipment
sourced from internationally renowned producers.

TEL has a large sourcing network, collaborating with
prominent partners throughout Europe, Asia and
Southern Africa.

INSURANCE

The Company has taken appropriate insurance
coverage for its plants, properties, equipment, stocks
and vehicles to safeguard against major risks. In
addition, the Company has obtained a Directors and
Officers Liability Policy to cover potential liabilities of
the Company's directors and officers.

PUBLIC DEPOSITS

During the year under review, the Company did not
accept any deposits from shareholders or the public
within the meaning of Section 73 of the Companies
Act, 2013 and the rules made thereunder.

REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the Statutory
Auditor, Cost Auditor nor the Secretarial Auditor
reported any instance of fraud committed against the
Company by its officers or employees, as specified
under Section 143(12) of the Companies Act, 2013,
which would require disclosure in this Report.

RELATED PARTY TRANSACTIONS

All related party transactions during the financial year
were carried out in compliance with the applicable
provisions of the Companies Act, 2013, the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015 (“Listing Regulations”) and the
Company's Policy on Related Party Transactions.

These transactions were reviewed and approved by
the Audit Committee and the Board of Directors and
where required, by the shareholders.

Details of material contracts and arrangements with
related parties, in accordance with the Company's
Related Party Transactions Policy and Section 188(1)
of the Companies Act, 2013 read with Rule 8(2) of the
Companies (Accounts) Rules, 2014, are annexed to
this Report as Annexure 2. The disclosures relating to
related party transactions for the financial year 2025¬
26 are also provided in the Notes to the Financial
Statements.

The Policy on Related Party Transactions, including
the policy for determining material transactions, is
available on the Company's website at
https://www.hester.in/corporate-governance

In compliance with Regulation 23(9) of the Listing
Regulations, the Company filed the required related
party transaction disclosures with the stock exchanges
along with the financial results.

COST ACCOUNTS AND RECORDS

The Company has maintained its cost accounts and
records in accordance with the regulations prescribed
by the Central Government under Section 148(1) of the
Act and the rules made thereunder.

BOARD OF DIRECTORS AND KEY
MANAGERIAL PERSONNEL

As on 31 March 2026, the Company's Board
comprised ten Directors, excluding the Alternate
Director, each bringing significant experience and
expertise in their respective fields. Other statutory
disclosures relating to the Board and its functioning
are provided in the Corporate Governance Report,
which forms an integral part of this Annual Report.

Appointment and Cessation of Directors

There were no changes in the composition of the
Board of Directors during the financial year under
review. Subsequently, Mr. Ravin Gandhi, Director of the
Company has resigned with effect from 12 May 2026
and Ms. Nina Gandhi, Alternate Director to Mr. Ravin
Gandhi ceased to be the alternate director with effect
from 12 May 2026.

Retirement by Rotation

In accordance with Section 152(6) of the Companies
Act, 2013, the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and the Articles
of Association of the Company, Mr. Sanjiv Gandhi
(DIN: 00024548), Non-Executive Director, is liable
to retire by rotation at the ensuing Annual General
Meeting and, being eligible, has offered himself for
re-appointment. The Board recommends his re¬
appointment for approval of the shareholders.

Declaration of Independence

Pursuant to Sections 149(6) and 149(7) of the
Companies Act, 2013 and Regulations 16(1)(b) and 25
of the Listing Regulations, the Company has received
declarations from all Independent Directors confirming
that they meet the criteria of independence and are
eligible to continue as Independent Directors of the
Company. The Board has taken the declarations on
record after assessing their veracity and has noted
that there has been no change in the circumstances
affecting their status.

Profile of Directors seeking Appointment/
Reappointment

Pursuant to Regulation 36(3) of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015 and the applicable provisions of Secretarial
Standard on General Meetings (SS-2), the brief profile
and other relevant details of the Director seeking
appointment or re-appointment at the ensuing Thirty-
Ninth Annual General Meeting are provided in the
Notice convening the said meeting.

Key Managerial Personnel

During the year under review, Mr. Divyesh Maru
resigned from the position of Chief Financial
Officer with effect from 13 November 2025. Based
on the recommendations of the Nomination and
Remuneration Committee and the Audit Committee,

Mr. Ashish Desai was appointed as Chief Financial
Officer with effect from 20 November 2025.

Additionally, Mr. Rajiv Gandhi was re-appointed as
CEO and Managing Director of the Company with
effect from 1 April 2026 for a further period of 3 years,
as approved by members of the Company through the
Postal Ballot Process.

The following persons are designated as Key
Managerial Personnel (KMP) as on 31 March 2026:

1. Mr. Rajiv Gandhi, CEO & Managing Director

2. Ms. Priya Gandhi, Executive Director

3. Mr. Ashish Desai, Chief Financial Officer

4. Mr. Vinod Mali, Company Secretary & Compliance
Officer

Board Evaluation

In accordance with the provisions of the Companies
Act, 2013 and Regulation 17 of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015, the Board carried out an annual performance
evaluation of its own performance, its Committees
and individual Directors, including the Chairman and
Independent Directors. The process was conducted
through structured questionnaires and in line with the
Guidance Note on Board Evaluation issued by SEBI.

A separate meeting of the Independent Directors
was held to review the performance of the Non¬
Independent Directors, the Board as a whole and the

Chairman of the Company, taking into account the
views of the Executive and Non-Executive Directors.

Based on the feedback received and the assessments
carried out, the overall performance of the Board,
its Committees and individual Directors was
rated between Very Good and Good on different
parameters. Further details of the evaluation process
are provided in the Corporate Governance Report
forming part of this Annual Report.

Nomination and Remuneration Policy

The Company has in place a Nomination and
Remuneration Policy formulated by the Nomination
and Remuneration Committee and approved by the
Board. The Policy sets out the framework for selection,
appointment and remuneration of Directors and Senior
Management Personnel. During the year, the Policy
was amended to align with recent changes in the
Listing Regulations. The detailed Remuneration Policy
is available in the Corporate Governance Report,
which forms part of this Annual Report.

Pecuniary Relationship

During the year under review, except as disclosed in
the audited financial statements, the Non-Executive
Directors did not have any pecuniary relationship or
transaction with the Company.

Board of Directors Meetings

During the financial year 2025-26, the Board of
Directors met five times. The Company complied with
the statutory requirement that the interval between
two consecutive meetings shall not exceed 120 days.
The details of the meetings held are provided in the
Corporate Governance Report, which forms part of this
Annual Report.

Non-disqualification

None of the Directors of the Company is disqualified
from being appointed or continuing as a Director
under Section 164(1) and 164(2) of the Companies
Act, 2013 read with Rule 14(1) of the Companies
(Appointment and Qualification of Directors)

Rules, 2014. Further, none of the Directors has
been debarred or disqualified by the Securities
and Exchange Board of India (SEBI), the Ministry
of Corporate Affairs (MCA) or any other statutory
authority.

DIRECTOR’S RESPONSIBILITY
STATEMENT

In terms of Section 134(3)(c) read with Section 134(5)
of the Companies Act, 2013 and to the best of
their knowledge and belief, and according to the
information and explanations provided to them, your
Directors state that:

a) That in preparation of Financial Statements for
the year ended 31 March 2026, the applicable
accounting standards have been followed and
no material departures have been made from the
same;

b) The Directors had 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 or loss of the
Company for that year;

c) The Directors had 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 had prepared the Financial
Statements for the year ended 31 March 2026 on
going concern basis;

e) The Directors had laid down the 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 had devised proper systems to
ensure compliance with the provisions of all
applicable laws were in place and were adequate
and operating effectively.

COMMITTEES OF BOARD OF DIRECTORS

The Company has constituted several Committees
as part of its commitment to sound corporate
governance and in compliance with applicable
statutory requirements. These Committees play an
important role in supporting the Board in its oversight
responsibilities and in enabling effective decision¬
making.

The Company has the following Committees of the
Board:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders' Grievances and Relationship
Committee

4. Corporate Social Responsibility Committee

5. Risk Management Committee

6. Management Committee

A detailed overview of each Committee, including
its composition, terms of reference, powers and the
number of meetings held during the year, is provided
in the Corporate Governance Report forming part of
this Annual Report.

RECOMMENDATION OF COMMITTEES

The Board of Directors confirms that it has accepted
all recommendations made by the Committees during
the year under review.

CORPORATE SOCIAL
RESPONSIBILITY (“CSR”)

Pursuant to Section 135 of the Act read with the
relevant rules, the Board has constituted a Corporate
Social Responsibility (“CSR”) Committee under the
chairmanship of Mr. Rajiv Gandhi. The details of the
composition of the Committee and the meetings
held are provided in the Corporate Governance
Report, forming part of this Report. The CSR Policy,
as approved by the Board on the recommendation of
the CSR Committee, is available on the Company's
website at

https://www.hester.in/corporate-governance

During the year, the Company spent INR 8.21 million
on CSR activities. The disclosures relating to CSR
activities, as required under the Companies (CSR
Policy) Rules, 2014, are annexed to this Board's Report
as Annexure 3.

VIGIL MECHANISM /WHISTLE BLOWER POLICY

The Company has instituted a robust vigil mechanism
to uphold ethical conduct, professionalism and
integrity across all levels.

In compliance with Section 177(9) of the Act and the
rules made thereunder, and Regulation 22 of the
Listing Regulations, the Company has established a
vigil mechanism and framed a Whistle Blower Policy
for Directors and employees to report concerns
relating to unethical behaviour, actual or suspected
fraud, or violation of the Company's Code of
Conduct and the SEBI (Prohibition of Insider Trading)
Regulations, 2015. The Whistle Blower Policy is hosted
on the Company's website and the relevant link is
provided in the Corporate Governance Report. No
employee or Director was denied access to the Audit
Committee during the year under review.

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

The Company has zero tolerance towards any form
of sexual harassment and has adopted a Policy on
Prevention, Prohibition and Redressal of Sexual
Harassment at the Workplace, in line with the
provisions of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act,
2013 and the applicable rules.

The Company continues to strive to provide an
environment for its employees and external persons
engaged with the Company that is free from
discrimination and harassment, including sexual

harassment. The Company's policy sets out the
guidelines for prevention, reporting and redressal of
sexual harassment. During the financial year 2025-26,
the Company received no complaints related to sexual
harassment at any of its locations.

INSIDER TRADING REGULATIONS

The Company has adopted the Code for Insider
Trading as per the SEBI (Prohibition of Insider Trading)
Regulations, 2015. All other details on insider trading
regulations are mentioned into the Corporate
Governance Report, which forms a part of this Annual
Report.

CORPORATE GOVERNANCE

The Company has complied with the Corporate
Governance requirements under the Companies
Act, 2013 and Regulations 17 to 27 and 46 of the
SEBI (LODR) Regulations, 2015, as amended from
time to time. A separate section containing the
detailed Corporate Governance Report, along with
a certificate from a Practicing Company Secretary
confirming compliance, forms part of this Annual
Report. The Board supports the basic principles of
corporate governance and places strong emphasis on
transparency, accountability and integrity.

SECRETARIAL STANDARDS

Secretarial Standards for Meetings of the Board
of Directors (SS-1) and General Meetings (SS-2)
are applicable to the Company. The Company
has complied with the provisions of all applicable
Secretarial Standards.

BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORT (‘BRSR’)

Pursuant to Regulation 34 and Schedule V of the
Listing Regulations, as well as the frequently asked
questions issued by the stock exchanges (BSE and
NSE), the Business Responsibility and Sustainability
Report (“BRSR”) of the Company for the financial year
ended 31 March 2026 has been uploaded on the
Company's website and can be accessed at https://
www.hester.in/shareholders/reports-certificates

The report covers the Company's initiatives from an
environmental, social and governance perspective.

MANAGEMENT DISCUSSION AND
ANALYSIS REPORT

The Management Discussion and Analysis Report is
set out in a separate section of this Annual Report
and forms part of this Report. The Audit Committee
has reviewed the Management Discussion and
Analysis relating to financial conditions and results of
operations during the year under review.

AUDITORS

Statutory Auditor and Audit Report

Chandulal M. Shah & Co. (Firm Registration No.
101698W), Chartered Accountants, Ahmedabad, was
appointed as the Statutory Auditors of the Company
till the conclusion of the Forty First Annual General
Meeting. Chandulal M. Shah & Co. has furnished a
declaration confirming its independence, arm's length
relationship with the Company and that it has not
undertaken any prohibited non-audit assignments for
the Company.

The Board has reviewed the Statutory Auditors' Report
of Chandulal M. Shah & Co. for the year ended 31
March 2026. The notes to the financial statements
referred to in the Auditors' Report are self-explanatory
and do not call for any further comments. The
Auditors' Report does not contain any qualification,
reservation, adverse remark or disclaimer.

Internal Auditor and Audit Report

Ernst & Young LLP, Ahmedabad, has been the
Internal Auditor of the Company for FY 2025-26. The
Internal Auditor is appointed by the Board on a yearly
basis, based on the recommendation of the Audit
Committee. The Internal Auditor reports its findings to
the Audit Committee on a quarterly basis. The scope
of internal audit is approved by the Audit Committee
and the Management from time to time.

The Board has re-appointed Ernst & Young LLP,
Ahmedabad for FY 2026-27 as Internal Auditor of the
Company, after obtaining its willingness and eligibility
letter.

Cost Auditor

Pursuant to the provisions of Section 148 read with the
Companies (Audit & Auditors) Rules, 2014 and other
applicable provisions of the Companies Act, 2013,
the Board of Directors, on the recommendation of the
Audit Committee, re-appointed Kiran J. Mehta & Co.,
Cost Accountants, Ahmedabad, as the Cost Auditor
of the Company for the financial year 2025-26, on the
remuneration terms approved by the Members at the
previous AGM. The Cost Audit Report for FY 2024-25
was filed within the prescribed time. The due date for
submission of the Cost Audit Report for FY 2025-26 is
within 180 days from 31 March 2026.

The Board has re-appointed Kiran J. Mehta & Co., Cost
Accountants, Ahmedabad for FY 2026-27 as Cost
Auditor to audit the cost records of the Company on
a remuneration up to INR 0.25 million plus applicable
Goods and Services Tax and out-of-pocket expenses
at actuals. As required under the Act and the Rules
made thereunder, the remuneration payable to
the Cost Auditor is required to be placed before
the Members in a general meeting for ratification.

Accordingly, a resolution seeking ratification of the
remuneration payable to Kiran J. Mehta & Co. has
been included in the Notice convening the 39^th Annual
General Meeting of the Company.

Secretarial Auditor and Secretarial Audit Report

Pursuant to Section 204 of the Companies Act, 2013,
the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 and Regulation 24A
of the Listing Regulations, Shah and Shah Associates,
a Peer Reviewed Practicing Company Secretaries
Firm, has been appointed as the Secretarial Auditor of
the Company for a term of five consecutive years, from
FY 2025-26 to FY 2029-30, at the 38^th Annual General
Meeting of the Company.

The Secretarial Audit Report for the financial year
2025-26 is attached to this Board's Report as
Annexure 4. The Board has reviewed the Secretarial
Auditor's Report for the year ended 31 March 2026
and confirms that the report does not contain
any qualification, reservation, adverse remark or
disclaimer.

Annual Secretarial Compliance Report

In compliance with Regulation 24A(2) of the Listing
Regulations, Mr. Tapan Shah, Practicing Company
Secretary, issued the Annual Secretarial Compliance
Report for the financial year 2025-26. The report,
placed before the Board at its meeting held on 15 May
2026, confirmed that the Company had maintained
proper records as required under the applicable rules
and regulations and that no action had been taken
against the Company or its material subsidiaries
or promoters/directors by SEBI, BSE or NSE. The
Company submitted the report to the stock exchanges
within the prescribed time.

CREDIT RATINGS

During the year under review, CARE Ratings Limited
reviewed the credit ratings of the Company. The rating
for the Company's long-term bank facilities stands at
“CARE BBB/Stable” revised from “CARE BBB /Stable”,
and the rating for its short-term bank facilities stands
at “CARE A3 ” revised from “CARE A2”. The ratings
indicate an adequate degree of safety with respect to
timely servicing of financial obligations.

CERTIFICATIONS/ RECOGNITION/
ACCREDITATIONS

The Company has the following Certifications/
Recognition/ Accreditations:

1. WHO - GMP

2. GLP (Good Laboratory Practices)

3. ISO 9001:2015

4. ISO 14001:2015

5. ISO 45001:2018

6. DSIR approved R&D Centre

BUSINESS RISK MANAGEMENT

The Company has a comprehensive risk management
framework addressing business, operational,
financial, sectoral, market, regulatory and compliance,
sustainability, human resources, information and
cyber security and strategic risks. These risks are
systematically assessed, measured and mitigated
through ongoing actions within the risk appetite
approved by the Board of Directors. The risk
management framework is periodically reviewed by
the Board and the Audit Committee. An overview
of the key risks and concerns is provided in the
Management Discussion and Analysis Report, which
forms part of this Annual Report.

In accordance with Section 134(3)(n) of the Companies
Act, 2013 and Regulation 21 of the Listing Regulations,
the Company has constituted a Risk Management
Committee. The details of the Committee, along with
its terms of reference, are set out in the Corporate
Governance Report, which also forms part of this
Annual Report.

MATERIAL CHANGES AND COMMITMENTS
AFFECTING FINANCIAL POSITION OF THE
COMPANY

There have been no material changes or commitments
affecting the financial position of the Company
between the end of the financial year and the date of
this Board's Report, except as disclosed elsewhere in
this Report.

SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS
OR TRIBUNALS

During the year under review, no regulator, court
or tribunal passed any significant or material order
affecting the going concern status of the Company or
its future operations.

COMPLIANCE WITH MATERNITY BENEFIT
ACT, 1961

During the year under review, the Company complied
with the Maternity Benefit Act, 1961 and extended all
statutory benefits to eligible women employees. The
Company remains committed to fostering an inclusive
and supportive workplace that safeguards the rights
and well-being of women employees in accordance
with applicable law.

DISCLOSURE UNDER THE INSOLVENCY
AND BANKRUPTCY CODE, 2016

During the year under review, no application or
proceeding has been initiated against the Company
under the Insolvency and Bankruptcy Code, 2016
before the National Company Law Tribunal.

DISCLOSURE RELATING TO VALUATION
AND ONE-TIME SETTLEMENT

In accordance with Rule 8(5)(x) of the Companies
(Accounts) Rules, 2014, there was no instance of
a one-time settlement with any bank or financial
institution during the year under review. Accordingly,
disclosure of any difference between the valuation
done at the time of taking a loan and at the time of
one-time settlement does not arise.

PROHIBITION OF BENAMI PROPERTY
TRANSACTIONS ACT, 1988

During the year under review, no proceedings were
initiated or remained pending against the Company
under the Prohibition of Benami Property Transactions
Act, 1988, as amended, and the rules made
thereunder.

TRANSACTIONS WITH COMPANIES
STRUCK OFF

During the year under review, the Company did not
enter into any transactions with companies struck
off under Section 248 of the Companies Act, 2013 or
Section 560 of the Companies Act, 1956.

FILING OF ANNUAL RETURN AND
FINANCIAL STATEMENTS

The Company has duly filed its Annual Return and
Financial Statements (Balance Sheet and related
documents) for the financial year ended 31 March
2025 with the Registrar of Companies, Gujarat, in
compliance with the provisions of the Companies Act,
2013 and the rules made thereunder.

APPOINTMENT OF DESIGNATED PERSON

Pursuant to Rule 9 of the Appointment of Designated
Person (Management and Administration) Rules, 2014,
the Company has appointed Mr. Rajiv Gandhi, CEO
& Managing Director, as the designated person to
oversee compliance with statutory obligations.

INTERNAL FINANCIAL CONTROL SYSTEMS
AND ITS ADEQUACY

The Company has established a formal framework for
Internal Financial Control (“IFC”) in compliance with
the requirements of the Companies Act, 2013. Specific
responsibilities relating to IFC have been defined for
the Board, Audit Committee, Independent Directors
and Statutory Auditors.

Accordingly, the Company has a well-established,
proper and adequate IFC system, which ensures:

1. the orderly and efficient conduct of business;

2. safeguarding of assets;

3. prevention and detection of frauds and errors;

4. accuracy and completeness of accounting
records; and

5. timely preparation of reliable financial information.

The Audit Committee and the Board regularly review
the effectiveness of the controls documented within
the IFC framework and take corrective and preventive
actions as required when weaknesses are identified.
This review covers entity-level controls, process-
level controls, fraud-risk controls and the information
technology environment.

Based on this evaluation, no significant events were
identified during the year that materially affected,
or are reasonably likely to materially affect, the
Company's IFC. Management concludes that IFC
and financial reporting were effective and adequate
in line with the Company's operations. The Statutory
Auditors have audited the adequacy and operating
effectiveness of the internal financial controls over
financial reporting and their Audit Report is annexed
as Annexure B and Annexure A to the Independent
Auditors' Report in the Standalone and Consolidated
Financial Statements, respectively.

TRANSFER OF SHARES AND DIVIDEND TO
INVESTOR EDUCATION AND PROTECTION
FUND (IEPF) ACCOUNT

During the year under review, in compliance with
Sections 124 and 125 of the Act and the rules made
thereunder, the Company transferred 5,449 equity
shares of 31 members whose dividend had remained
unclaimed or unpaid for a consecutive period of seven
years to the IEPF.

Further, INR 0.90 million being unclaimed dividend
pertaining to the final dividend for financial year
2017-18 and the first and second interim dividends for
financial year 2018-19 was transferred to the IEPF after
giving notice to the concerned Members to claim their
unpaid/unclaimed dividend.

ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3) of
the Companies Act, 2013 read with Rule 12 of the
Companies (Management and Administration) Rules,
2014, a copy of the Annual Return of the Company for
the financial year ended 31 March 2026 in Form MGT-
7 has been uploaded on the Company's website and
can be accessed at www.hester.in

PARTICULARS OF EMPLOYEES

In terms of Section 197(12) of the Companies Act, 2013
read with Rule 5(1) of the Companies (Appointment

and Remuneration of Managerial Personnel) Rules,
2014, the required disclosures relating to remuneration
and other details are provided in Annexure 5 to this
Report.

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

The information on conservation of energy, technology
absorption and foreign exchange earnings and outgo,
as stipulated under Section 134(3)(m) of the Act read
with Rule 8 of the Companies (Accounts) Rules, 2014,
is provided in Annexure 6 and forms part of this
Report.

GENERAL DISCLOSURES

Your Directors confirm that the Company has made
the required disclosures in this Report for the items
prescribed under Section 134(3) of the Companies Act,
2013 and Rule 8 of the Companies (Accounts) Rules,
2014, to the extent applicable during the year.

Apart from the matters mentioned in this Report, there
are no material changes or commitments affecting the
financial position of the Company between the end of
the financial year and the date of this Report.

ACKNOWLEDGEMENT

The Directors express their sincere appreciation for
the continued support and cooperation extended
to the Company by the Bank. They also thank the
medical professionals, traders and consumers for their
continued patronage of the Company's products.

The Directors place on record their appreciation for
the dedicated efforts and hard work of employees at
all levels, which have played an important role in the
Company's success.

The Directors also thank the Company's vendors,
investors, business associates, stock exchanges, the
Government of India, State Governments and various
departments and agencies for their continued support
and cooperation.

Your Directors deeply appreciate the commitment,
dedication and contribution of every member of the
Hester Biosciences family. Their collective efforts
continue to support the Company's growth and
success.

For and on behalf of Board of Directors

Rajiv Gandhi Priya Gandhi Date 15 May 2026

CEO & Managing Director Executive Director Place Kadi, Mehsana

DIN: 00438037 DIN: 06998979