Your Directors have pleasure in presenting the Twenty Second Annual Report on the affairs of the Company
together with Board's Report and the Audited Financial Statements of the Company for the Financial Year ended
March 31, 2026 together with the reports of the Auditors thereon.

FINANCIAL RESULTS

The financial results of the Company for the Financial Year 2025-26 as compared with the previous Financial Year
are as under:

The consolidated performance of the Company and its subsidiaries has been referred to wherever required

On a consolidated basis, the total income for FY 2025-26 was ?58517.16 Lakhs, against the previous year
2024-25 total income of ? 54617.93 Lakhs. However, the Profit after tax decreased from ?2657.36 Lakhs
during the previous year to ?770.53 Lakhs during FY 2025-26 as a result of increase the operating
expenditure.

On a standalone basis, the total income for FY 2025-26 was ? 49180.45 Lakhs against the previous year
total income of ?45453.86 Lakhs. The profit after tax (PAT) for FY 2025-26 is decreased to ?1082.54
Lakhs against the previous year (FY2024-25) profit after tax (PAT) of ?2556.42 Lakhs due to due to
increase in operational Expenditure,

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Industry Overview

The global paper packaging market is valued at approximately USD 435.7 billion in 2026 and is projected
to scale past USD 600 billion by the early 2030s, driven by global sustainability mandates and e-
commerce expansion.

Global Valuation: The market size is anchored around $436 billion to $479 billion in 2026, growing at a
compound annual growth rate (CAGR) of about 4.6% to 5.3%.

The Paper Carry Bag Industry in India Demand Landscape and Growth Outlook

India's paper carry bag industry is at an inflection point, driven by a convergence of regulatory mandates,
environmental consciousness, rapid urbanisation, e-commerce growth, and evolving consumer
preferences. The industry represents one of the most structurally supported demand stories in the broader
Indian paper sector.

Market Size and Growth Trajectory

India's paper bags market was valued at approximately USD 759.7 million (approximately ?6,300 crore)
in 2024 and is projected to reach USD 1,122.6 million by 2033, growing at a compound annual growth
rate (CAGR) of approximately 4.21% over the forecast period. Measured by volume, the Indian paper
bags market stood at approximately 3.5 billion units in 2023 and is forecast to grow at a CAGR of
12.78% to reach 4.1 billion units by 2030. Certain industry estimates project even faster growth, with the
market expected to reach USD 1,430.84 million by 2035 at a CAGR of 5.61%. The broader India paper
packaging market, of which paper bags form an integral part, was valued at USD 19.07 billion in 2025
and is forecast to reach USD 46.43 billion by 2030, growing at an impressive CAGR of 19.48%.

Demand Drivers Across End-Use Sectors

The demand for paper carry bags is being driven simultaneously from multiple high-growth end-use
sectors:

Retail and Organised Trade: The rapid expansion of modern retail formats, shopping malls, and branded
retail chains across Tier-I, Tier-II, and Tier-III cities is creating large and growing demand for premium,
printable paper carry bags as both a functional and brand-communication tool.

E-Commerce and Quick Commerce: India processed approximately 5.2 billion online shipments in 2024,
compared to 3.8 billion in the previous year. The e-commerce and quick-commerce boom is driving
demand for kraft paper-based packaging and carry bags across the fulfillment ecosystem.

Food and Beverage and Food Delivery: The rapid growth of organised food service, QSR chains, cafes,
and online food delivery platforms has created substantial and recurring demand for paper bags in the 80 -
120 GSM range.

Pharmaceuticals and Healthcare: The pharmaceutical and healthcare packaging sector is increasingly
adopting paper-based carry solutions as part of sustainability and compliance commitments.

FMCG: Large FMCG companies are transitioning product lines to paper packaging, signaling a sector¬
wide structural shift.

Key Industry Trends & Challenges

Eco-Friendly Transition: Brands are shifting away from single-use plastics due to stricter global
regulations and Extended Producer Responsibility (EPR) policies that favor recyclable fiber.

Packaging has emerged as the fifth largest sector of the Indian economy, playing a pivotal role in driving
industrial growth, innovation, and value creation across FMCG, agriculture, and food processing.
Growing at a rapid 22 to 25% annually, the sector is supported by advances in technology, logistics, and
rising consumer demand. India has a strong base with over 22,000 packaging units, of which 85% are
SMEs, and a robust paper manufacturing ecosystem of more than 850 mills, with 526 operational,
producing nearly 25 million tonnes annually. Installed capacity in paper and paperboard stands at about 5
million tonnes, with utilisation levels above 95%, reflecting both scale and efficiency.

Market Dynamics and Future Projections

The packaging industry’s growth is underpinned by India’s expanding middle class, improved supply
chain infrastructure, and the rapid rise of e-commerce platforms. Increasing consumption of packaged
food, projected to reach Rs. 29,563 crore (US$ 3.4 billion) by 2027, and sustained export demand are
adding momentum. During FY26, India’s paper, paperboard and newsprint trade remained strong, with
imports reaching 2,552.8 thousand tonnes and exports standing at 1,536.5 thousand tonnes across major
grades, including writing and printing paper, kraft paper, coated paper and newsprint. Looking ahead, a
mix of technological advancements, sustainable practices, and favourable government policies such as
Make in India and MSME-focused incentives position the sector as a key contributor to India’s
manufacturing growth and its emergence as a global packaging hub.

Government Initiatives

The government has launched the National Packaging initiative, which focuses on the following measures
to promote the sector:

In April 2026, FSSAI proposed amendments to its Packaging Regulations, 2018, encouraging the use of
eco-friendly materials such as paper, paperboard and cellulose for pan masala packaging.

On September 29, 2025, the Department of Posts signed a strategic MoU with the Indian Institute of
Packaging (IIP) to promote sustainable packaging solutions and improve efficiency in postal logistics.

The Union Cabinet approved a Rs. 1,788 crore (US$ 204.8 million) project to establish a new banknote
paper production line in Narmadapuram to strengthen domestic manufacturing of high-security paper.

Set up guidelines and certain requirements for design and material of packaging usedPromote the process
of moving in bulk quantities

Focus on promotion of centralized industrial activity by encouraging application of necessary and
sophisticated infrastructure such as specialized logistic parks with appropriate facilities as well as
packaging labs to work on designs and carry out tests

Encourage processes to reduce packaging waste by establishing material recovery facilities (MRFs)
Support domestic business to manufacture sophisticated packaging materials

Develop training facilities and certified programs of the highest order to maintain availability of skilled
labour

Outlook

The outlook for India’s paper and packaging industry remains highly promising, supported by a growing
population, rapid urbanisation, and rising disposable incomes. The boom in e-commerce and packaged
food consumption is driving robust demand, while an increasing emphasis on sustainability is
encouraging innovation in eco-friendly materials and practices. Government initiatives such as Make in
India, MSME support, and large-scale infrastructure development are expected to further strengthen
manufacturing capacity and streamline supply chains. Advances in technology are enhancing efficiency
and quality standards, and rising export potential is opening new avenues for global expansion. Although
challenges such as volatile raw material prices and competition from alternative materials persist,
continued investments and a strong sustainability focus position the sector to consolidate its global
standing and drive long-term growth.

Overview of the Company

The Company is engaged in the manufacturing of Paper and Paper Product and is a packaging solution
providing company. Subam started its journey in the year 2004 with manufacturing of paper cones and
later expanded the product base by adding Duplex board and Kraft paper in its portfolio. The company is
not like the traditional paper manufacturers, wherein the Company does not manufacture the products
from wood pulp but instead uses wastepaper as raw material. The Company aims to preserve Mother
Nature and tends to drive the Company on the principle of recycling. The Company leverages wastepaper
as the primary raw material in the production of Kraft Paper and Duplex Board.

To further minimize the environmental impact, the Company harnesses renewable energy through its own
wind and solar power installations. The captive wind energy infrastructure includes two windmills: with a
capacity of 850 KW each totalling approximately 1.7 MW. Additionally, the Company operates solar
plant with a capacity of 14 MW. These renewable energy sources enable the Company’s manufacturing
facilities to significantly reduce their carbon footprint, aligning with the Company’s goals of sustainable
and eco-friendly operations.

As an ISO 9001:2015 and FSC Recycled certified organization, the Company follows a strong Quality
Management System. The Company ensures top-quality materials, workmanship, schedules, and public
service, meeting all project standards. The Company focuses on quality control upholds high safety and
environmental standards, consistently meeting client expectations. The FSC Recycled certification of the
Company, shows the Company’s commitment to sustainability by using 100% recycled materials. The

Company’s success is due to understanding customer needs, offering cost-effective and consistent quality
products, adhering to delivery schedules, being flexible with sizes, and providing responsive customer
service. The Company has a well-trained team dedicated to meeting special quality requirements.

The Company features an infrastructure facility, supported by a dedicated team of professionals, focused
on the production of Kraft Paper and Duplex Board to meet customer demands promptly. With the
capability to manufacture and supply Kraft Paper and Duplex Boards in various shades, our products
offer GSM ranging from 120 to 300, Busting Factor of 16 to 35, and Deckle sizes from 2,650 MM to
4,400 MM and with reel diameters up to 1,400 MM. Furthermore, the Company maintain a substantial
raw material storage facility to ensure ample reserves, enabling consistent production of high-quality
products for the packaging industry.

The Company is located at Tirunelveli, Tamil Nadu and is also in proximity to the Harbour city of
Tuticorin, Tamil Nadu. Since inception, the Company has prioritized focus towards continual
improvement based on specific product quality and end user application. The success narrative of the
Company is shaped by a clear and consistent business strategy that has propelled the Company to its
current standing.

Sustainability

The Company uses wastepaper as its primary raw material for paper manufacturing which has significant
environmental benefits. Recycling one ton of paper extends far beyond waste reduction, making a
substantial contribution to environmental conservation. By opting to recycle, the Company collectively
saves the equivalent of 17 trees, thereby conserving precious forests and promoting biodiversity.
Furthermore, the conservation of 7,000 gallons of water and the sparing of 380 gallons of oil highlight the
resource efficiency achieved through recycling. Notably, reducing landfill space by 3.3 cubic yards eases
the burden on waste disposal systems, while the energy savings of 4,000 kilowatts underscore the inherent
efficiency and sustainability of recycling processes.

By recycling paper, the Company actively contributes to the preservation of natural resources, reducing
the need for new raw materials. This process also results in significant energy savings, minimizing the
environmental impact associated with paper production. Moreover, recycling paper helps reduce
greenhouse gas emissions, contributing to a healthier and more balanced ecosystem. Equally important, it
ensures that landfill space is spared for non-recyclable waste, fostering efficient waste management
practices. This holistic approach underscores the multifaceted benefits of paper recycling, aligning with a
broader commitment to environmental responsibility and a more sustainable future.

Key strengths of the Company

Recycling of paper waste and sustainable packaging solutions

We use wastepaper as our primary raw material for paper manufacturing has significant environmental
benefits. Recycling one ton of paper extends far beyond waste reduction, making a substantial
contribution to environmental conservation. By opting to recycle, we collectively save the equivalent of
17 trees, thereby conserving precious forests and promoting biodiversity. By recycling paper, we actively
contribute to the preservation of natural resources, reducing the need for new raw materials. This process
also results in significant energy savings, minimizing the environmental impact associated with paper
production. Moreover, recycling paper helps reduce greenhouse gas emissions, contributing to a healthier
and more balanced ecosystem.

Significant advantage due to proximity of Subam's factory location

The company has invested in water pumping stations and connecting pipelines, which are fully
operational, ensuring efficient water distribution throughout the facility. Moreover, our strategic location
offers a distinct advantage, with the Thamirabarani River situated within a mere 6 km proximity.
Renowned for its extensive catchment area and the receipt of both South-west Monsoon and North-east
Monsoon rains, this river serves as a reliable water source for our operations.

The company has successfully obtained water drawl permission from the Government of Tamil Nadu, we
have been authorized to withdraw the quantity of water at the rate of 25,000 gallons per hour from the
river Thambaraparani, supplemented by an additional ten lakh litres per day from our rainwater
harvesting system. This prudent water management strategy aligns with our commitment to sustainability
and responsible resource utilization.

For paper-based industries, water quality is paramount in ensuring the production of high-quality paper.
The proximity of Subam's factory location to the perennial water source of the Tamirabarani River, which
flows throughout the year, is a significant advantage.

Efficient Inventory Management

Efficient Inventory Management lies at the core of our operations, seamlessly integrated with ERP
technology that invigorates all our processes and systems. This integration empowers our company to
respond to requirements while maintaining a keen focus adeptly and efficiently on effective inventory
management. The utilization of ERP technology not only streamlines the tracking and control of
inventory but also enhances the overall responsiveness of the organization, ensuring a swift and well-
coordinated approach to addressing dynamic market demands

Manufacturing of odor free paper

The demand for odor-free paper is on the rise, driven by heightened public awareness, particularly in the
realm of food product packaging and carry bag consumption. With our advanced ETP technology, our
company is well positioned to meet this growing demand while simultaneously demonstrating our
commitment to environmental responsibility. By investing in modern ETP infrastructure, we not only
ensure compliance with regulatory standards but have also set a new benchmark for sustainability within
the industry. This strategic initiative aligns with the company's vision of delivering high-quality paper
products that meet the evolving needs of consumers and contribute to a healthier environment.

Advantage of producing all grades of paper

Subam’s unique advantage of producing a wide range of paper grades all on one campus creates
substantial demand in the market for their products. This includes several specific applications, which
further enhance their market presence and appeal.

No other company in South India offers such a comprehensive facility. This setup allows Subam to use
raw materials and resources efficiently.

Our products serve various industries, each requiring several types of paper with specific properties,
coatings, and finishes. This diverse approach helps us meet many customer needs and adapt to changing
market demands. By offering a variety of products with unique features and uses, we stay competitive and
meet our customers' evolving preferences.

Our Network of Raw Material Suppliers

Our primary raw material is recycled paper, which we utilize to manufacture our diverse range of paper
products. By relying on a mix of imported and local sources for our raw materials, we maintain flexibility
and resilience in our operations. This approach not only supports our sustainability goals by emphasizing
the use of recycled materials but also enhances our ability to meet diverse customer needs with quality
products. Our commitment to environmental responsibility and quality control is evident throughout our
production process, from the initial sourcing of raw materials to the final manufacturing stages.

Management Outlook

Management Outlook, setting out the strategic vision, operational developments, and growth roadmap for
the Company and its wholly owned subsidiary, Subam Papers and Boards Private Limited. The
Management believes that the ongoing capacity expansion, product diversification strategy, and the
favourable secular tailwinds in the Indian paper packaging sector collectively position the Company for a
transformative phase of growth, which is expected to generate sustained and superior long-term value for
all stakeholders.

Completion of Capacity Expansion- Automated Kraft Manufacturing Plant.

Subam Papers and Boards Private Limited, the wholly owned subsidiary of the Company, has
successfully completed its capacity expansion by setting up a state-of-the-art, Automated Kraft paper
manufacturing plant. This represents a landmark milestone in the Company's strategic growth journey and
underscores the Management's commitment to investing in world-class infrastructure and technology to
strengthen the Company's competitive position in the Indian paper manufacturing landscape.

The new plant has been designed with the latest manufacturing technology, ensuring higher efficiency,
superior product consistency, and greater operational flexibility. Full automation across the production
process minimises human error, reduces turnaround times, and significantly enhances the Company's
ability to service large-volume and quality-sensitive customers across the value chain. The Management
views this investment as a cornerstone asset that will underpin the Company's revenue growth and margin
improvement trajectory over the medium-to-long term.

Current and Post-Expansion Consolidated Manufacturing Capacity

Prior to the commissioning of the new plant at Subam Papers and Boards Private Limited, the
consolidated manufacturing capacity of Subam Papers Limited stood as follows:

MTPA: Metric Tons Per Annum

With the successful commissioning of the new plant, the total consolidated manufacturing capacity of
Subam Papers Limited has increased from 1,80,000 MTPA to 3,07,750 MTPA representing an overall
capacity expansion of approximately 70.97%. The Kraft paper manufacturing capacity alone has more
than doubled, growing by 96.78% from 1,32,000 MTPA to 2,59,750 MTPA. The Management views this
scale-up as transformative, establishing the Company among the larger, more competitive integrated
paper manufacturers in India.

Product Diversification: 80-120 GSM Paper for Paper Carry Bag Manufacturing

A defining feature of the new plant at Subam Papers and Boards Private Limited is its capability to
manufacture Kraft paper in the 80 to 120 GSM (Grams per Square Metre) range. This specific GSM band
is the primary raw material used in the manufacture of paper carry bags a product category that is
witnessing exponential demand growth across India, driven by legislative, environmental, and consumer-
led forces.

This product capability is not merely an incremental addition to the Company's portfolio it represents a
deliberate and strategically timed entry into one of the most rapidly growing segments within the Indian
paper and packaging industry, as detailed below.

Strategic Advantages for Shareholders

The Management believes that the completion of the capacity expansion and the strategic entry into the
80-120 GSM paper carry bag segment creates a compelling and multi-dimensional value proposition for
the Company's shareholders. The key strategic advantages are detailed below:

(a) Near-Doubling of Revenue Potential

Consolidated capacity expansion from 1,80,000 MTPA to 3,07,750 MTPA (70.97% increase) directly and
substantially raises the Company's revenue ceiling. As the new plant ramps to full utilisation,
shareholders can expect a meaningful step-up in consolidated revenues, EBITDA, and net profit with
limited incremental fixed costs, given the economies of scale embedded in the automated facility.

(b) Entry into a High-Growth, High-Margin Downstream Segment

The ability to produce 80-120 GSM paper the primary raw material for paper carry bags marks a
deliberate move into a value-added, premium-priced product segment. This GSM range commands higher
realisations over standard industrial Kraft grades and positions the Company to participate in a consumer-
driven, sustainability-mandated upgrade cycle. The Company transitions from a commoditised paper
manufacturer to a value-added paper solutions provider, targeting a segment growing at double-digit
CAGRs in India.

(c) Strong Regulatory Moat

India's progressive ban on single-use plastics creates a structural, policy-backed demand moat for Kraft
paper-based packaging. Unlike cyclical industrial demand, demand for paper carry bags is increasingly
mandated by law providing the Company's customers with assured offtake visibility. This regulatory
tailwind supports the Company's order book stability, pricing resilience, and long-term revenue
predictability.

(d) Competitive Scale Advantage

With a post-expansion Kraft paper capacity of 2,59,750 MTPA, the Company is positioned among India's
larger integrated Kraft paper manufacturers. Scale delivers lower per-unit production costs, access to
higher-volume long-term contracts, a stronger supplier negotiating position, and enhanced
competitiveness against smaller, fragmented players collectively supporting sustainable margin
expansion.

(e) Product and Customer Base Diversification

The addition of carry bag paper grades enables the Company to serve an entirely new and rapidly growing
customer segment carry bag manufacturers, converters, and branded packaging companies alongside its
existing industrial customer base.

(f) Automated Plant-Superior Capital Efficiency

Automation at the new plant delivers measurable financial benefits: lower per-unit labour costs,
consistent product quality with minimal rejections, reduced operational risk, and the ability to scale
throughput rapidly with demand.

Co-generation (COGEN) Power Plant Enhancing Energy Self-Sufficiency

As part of its broader infrastructure and cost optimisationStrategy Company is in the process of installing
a Co-generation (COGEN) Power Plant under its wholly owned subsidiary name Subam Papers and
Boards Private Limited, which is expected to be commissioned by October 2026.

At Present Energy/ Power Consumption

After Commissioning of COGEN Power Plant

Strategic Significance for the Company and Shareholders

The COGEN plant is not merely a utility infrastructure addition it is a strategic lever with direct and
measurable financial and operational implications:

Dramatic reduction in external power dependence

External power purchases will fall sharply from 20 Lakh Units to just 5 Lakh Units per month, a
reduction of 75%. The Company's overall self-sufficiency in power will improve from 55.6% currently to
93.75% post-commissioning, significantly insulating the Company from grid tariff volatility, TNEB
supply interruptions, and third-party pricing risks.

Significant cost savings

Power and fuel costs are among the largest operating cost heads in paper manufacturing, typically
accounting for 12-14% of total production costs. A COGEN plant generates power from the heat
recovered during the manufacturing process, making it substantially cheaper per unit than grid-purchased
electricity. The reduction of 15 Lakh Units per month in external purchases at prevailing industrial tariff
rates is expected to translate into meaningful savings in the Company's power cost line, with a direct and
positive impact on EBITDA margins.

The Management of Subam Papers Limited is deeply confident in the Company's strategic direction and
the strong foundation being created through the current capacity expansion. The successful
commissioning of the Automated Kraft paper manufacturing plant at Subam Papers and Boards Private
Limited marks the beginning of a new and significantly larger chapter for the Company. With
consolidated capacity growing to 3,07,750 MTPA, a product portfolio that is directly aligned with India's
fastest-growing paper packaging segments, and a regulatory environment that structurally favours Kraft
paper-based solutions, the Management believes the Company is exceptionally well-positioned to deliver
sustainable and superior long-term value to its shareholders, customers, employees, and other
stakeholders

Strategic Investment made by the Company

The Company has established a business of packaging related activities which includes manufacture of
carton box and corrugated box and other container made up of paper and paper product and in this regard,
has entered into LLP agreement with M/s. Nellai Subam Packaging LLP with 80% Stake.

Our Wholly owned Subsidiary Company, Subam Paper and Boards Private Limited, entered into LLP
Agreement with an existing entity named M/s. Mercury paper and Products LLP with 51 % stake with
investment of Rs.10 Crores. Mercury Pack and Paper Products LLP is in the business of manufacture of
Corrugated boxes, printed cottons and other paper products. Mercury Pack and Paper Products LLP is in
the same line of business as that of the Company and its subsidiaries.

Our Wholly owned Subsidiary Company, Subam Paper and Boards Private Limited, established one more
LLP named Rajapalayam Success Packaging LLP with 51% Stake/ contribution manufacture of
corrugated paper and paper board and paper and paper board containers.

The Company believes that this partnership would enable business synergies.

We Subam papers limited and Our Subsidiary Subam paper and Boards Private Limited established the
Warehouses and Godowns at Madurai, Trichy, Chennai, Sattur, Thiruvanathapuram, Cochin and further
propose to establish more warehouses at TamilNadu, Kerala and other states, which would be used for
collection of Raw materials (waste paper) and dispatch the finished goods to customers. This would
result in reduction in the transport cost for movement of materials.

Our Wholly owned Subsidiary Company M/s. Subam paper and board Private Limited has also entered
into Logistics related activities wherein it would serve both internal and external customer requirements.

Strategic Intervention is a multi-step process - sometimes consisting of many small steps, not a few big
ones. Along the whole journey, an interaction with various stakeholders is essential and we are.

TRANSFER TO RESERVES

The Company has not transferred to any amount to General Reserve during the year,

DIVIDEND

In order to conservation of funds for future business expansion, the Company has not declared any
dividend during the year.

CHANGE IN NATURE OF BUSINESS, IF ANY

There is no change in the nature of business during the year under review. However, the Company has
been converted into public limited with effect from May 15, 2025 and The shares of the Company are
listed on BSE SME platform w.e.f. October 8, 2024.

CHANGES IN SHARE CAPITAL, IF ANY

During the Period the Authorized Capital of the Company be and is hereby altered by increasing from the
existing Rs. 25,05,00,000.00 (Rupees Twenty-Five Crores and Five Lakhs Only) divided into 2,50,00,000
(Two Crores Fifty Lakhs) Equity Shares of Rs. 10.00 (Rupees Ten Only) each and 50,000 (Fifty
Thousand) 12% Non-Cumulative Redeemable Preference Shares of Rs. 10.00 (Rupees Ten Only) each to
Rs. 32,05,00,000.00 (Rupees Thirty-Two Crores Fifty Lakhs Only) divided into 3,20,00,000 (Three
Crores Twenty Lakhs) Equity Shares of Rs. 10.00 (Rupees Ten Only) each and 50,000 (Fifty Thousand)
12% Non-Cumulative Redeemable Preference Shares of Rs.10.00 (Rupees Ten Only) each, vide
resolution passed in the Extra Ordinary General Meeting of the Company held on December 10, 2025.

The paid up capital of the Company as on 31st March 2025 was Rs. 23,24,48,700 comprising of
2,32,44,870 equity shares of Rs.10/- (Rupees Ten) each.

During the year under review, the Company had offered to raise Rs. 107,04 crores through issue of
26,32,800 (Twenty-Six Lakhs Thirty-Two Thousand Eight Hundred Only) Warrants (“Warrants”) of the
Company, whereby each Warrant is convertible in to 1 (one) equity share of face value ? 10.00 (Rupees
Ten only) (“Additional Equity Share”) at any time within 18 (eight een) months from the date of allotment
of the Warrants as per the ICDR Regulations, for cash consideration on a preferential basis, at a price of
? 152.00 (Rupees One Hundred Fifty-Two Only) per Warrant (including premium of ? 142.00 (Rupees
One hundred and Forty-Two Only)).

b) 44,09,600 (Forty-Four Lakhs Nine Thousand Six Hundred Only) Equity shares of the company of the
face value of ? 10.00 (Rupees Ten only) each, each fully paid-up (“Equity Shares”) for cash consideration
on a preferential basis, at a price of ?152.00 (Rupees One Hundred Fifty-Two Only) per Equity (including
premium of ? 142.00 (Rupees One hundred and Forty- Two Only).

For utilization of following objects

1. The company received Rs 64.36 crore instead of Rs 67.02 crore, through the preferential issuance of
equity shares and received Rs. 10.00 crore against the total warrant issue proceeds of Rs. 40.01 crore,
representing 25% of the total warrant issue proceeds. As of March 31, 2026, the Company received Rs.
74.36 crores out of the total issue size of Rs. 107.04 crores.

2. The balance of 75% of the consideration shall be received at the time of allotment of the equity shares
pursuant to the exercise of the option attached to each such Warrant by the respective Warrant holder,
within 18 (eighteen) months from the date of allotment of the Warrants.

Due to under subscription in the preferential issue of Equity Shares, company received Rs 64.36 crore as
against the proposed amount of Rs 67.02 crore, the overall cost utilisation of the Company is hereby
revised and reduced from Rs 107.04 Crore to Rs 104.37 Crore.

The allocation towards General Corporate Purposes is hereby reduced from Rs 4.03 Crore to Rs 1.36
Crore.

The issue proceeds were fully utilized as of March 31, 2026.

Pursuant to the above issuances, the Paid-up Share Capital of the Company as on the date of this report
stands at Rs. 27,47,92,700 comprising of 2,74,79,270 equity shares of Rs. 10 each.

MATERIAL CHANGES BETWEEN THE DATE OF THE BOARD REPORT AND END OF
FINANCIAL YEAR

There have been no material changes and commitments affecting the financial position of the Company
which have occurred between the end of the financial year of the Company to which the financial
statements relate and the date of the report.

STATUTORY AUDITOR

M/s. CNGSN ASSOCIATES LLP, Chartered Accountants Chennai having firm Registration
No.004915S/S20036 has been appointed as Statutory Auditors of the Company for the period of Five
Years vide the resolution passed by the Shareholders in their Twentieth Annual General meeting of the
Company held on September10, 2024, at a remuneration to be fixed by the Board of Directors of the
Company, in addition to the re-imbursement of applicable taxes and actual out of pocket and travelling
expenses incurred in connection with the audit and billed progressively.

AUDITOR’S REPORT AND SECRETARIAL AUDIT REPORT

The statutory Auditor’s report and the Secretarial Auditor’s report do not contain any qualifications,
reservations, or adverse remarks or disclaimer. Secretarial audit report is attached to this report as
Annexure B.

DEPOSITS

During the year under review, your Company has neither invited nor accepted any deposits from public in
terms of Section 73 of the Companies Act, 2013 and consequently, no amount on account of principal or
interest on deposits from public was outstanding as on March 31, 2025.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and
outgo stipulated under Section 134(3)(m) of the Companies Act,2013 read with Rule8 of the Companies
(Accounts) Rules2014, is annexed herewith as “Annexure A”.

CORPORATE SOCIAL RESPONSIBILITY

In terms of Section 135 and Schedule VII of the Companies Act 2013,the Board of Directors of the
Company have a formed a Corporate Social Responsibility (CSR) Committee. The CSR Committee of the
Board have formulated necessary CSR policy which is available with the Company. The Company has
been pursuing the CSR project and CSR Obligation. The report on Corporate Social Responsibility (CSR)
as prescribed under the Companies (Corporate Social Responsibility policy) 2014 is given in Annexure
III.

SUBSIDIARY AND ASSOCIATE COMPANIES

The Company has two wholly owned subsidiary Company namely Subam Agro Ventures Private Limited
and Subam Paper and Boards Private Limited. Also, the Company holds 80% profit share in M/s.
NellaiSubam Packaging LLP.Further, the Company has two Associate Companies namely B.M.M. Paper
Board Private Limited and M/s. Saradhambika Paper and Board Mills Private Limited, as on March
31,2026 The information as required under the first proviso to sub-Section (3) of Section 129 is given in
Form AOC - 1 in Annexure I.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability,
confirm that:

i. In the preparation of the annual accounts, the applicable accounting standards have been followed and
there are no material departures;

ii. They 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 of the Company for that period;

iii. They have taken proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities;

iv. They have prepared the annual accounts on a going concern basis;

v. They have laid down internal financial controls to be followed by the Company and such internal
financial controls are adequate and operating effectively;

vi. They have devised proper systems to ensure compliance with the provisions of all applicable laws and
that such systems are adequate and operating effectively.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

As of this report, the Company has 6 (Six) Directors on the Board, 1 (One) as Managing Director, 1 (One)
as Executive Director, 1 (One) as Non-Executive Directors (women director) and 3 (Three) as
Independent Directors. The list of Directors is given below:

During the year, Mr. ArunachalamAnbuSanjeevkani, is appointed as Independent Director of the
Company with effect from 27/09/2025.

During the year under review, the Independent Directors of the Company had no pecuniary relationship
or transactions with the Company, other than sitting fees, commission and reimbursement of expenses, if
any.

Number of Meetings of the Board:

During the Financial Year 2025-26, the Company hold Seven meetings of the Board of Directors. All the
meetings were convened and held in accordance with the proceedings of the Companies Act, 2013 and
Secretarial Standard issued by ICSI institute of Company Secretaries of India). The time gap between any
two meetings did not exceed 120 days.

The attendance of Directors to the Meetings of the Board is given below:

CORPORATE GOVERNANCE

The Company stands committed to good Corporate Governance practices based on the principles such as
accountability, transparency in dealings with the stakeholders, emphasis on communication and
transparent reporting. The Company has complied with the requirements of the applicable regulations, in
respect of corporate governance including constitution of the Board and Committees thereof.

The Corporate Governance framework is based on an effective Independent Board, the Board’s
Supervisory role from the executive management team and constitution of the Board Committees, as
required under law.

The Board functions either as a full board or through the various committees constituted to oversee
specific operational areas.

As on the date of this report, there are 6 (Six) Directors on the Board out of which Half of the Board are
Independent Directors. The Company is in compliance with the corporate governance norms prescribed
under the Companies Act, 2013, particularly, in relation to appointment of Independent Directors to the
Board and constitution of Board level committees. The Company has also complied with the relevant
provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as and
when made applicable.

Details of attendance of Directors, Remuneration and shares held

Committees of the Board

The following committees have been constituted in terms of SEBI (LODR) Regulations, 2015,the Companies Act,
2013 and other applicable law:

Audit Committee

Stakeholders’ Relationship Committee
Nomination and Remuneration Committee
Corporate Social Responsibility Committee
Internal Complaints Committee

Audit Committee

Our Company has constituted an Audit Committee ("Audit Committee"), as per Section 177 of the Companies Act,
2013 and Regulation 18 of the SEBI (LODR) Regulation, 2015; vide resolution passed at the meeting of the Board
of Directors held on May 17, 2024., which was amended vide resolution passed at the meeting of the Board of
Directors held on September 27, 2024. by

1. Mr. T. Balakumar, Managing Director was replaced by Sudha Alagarsamy and

2. the Audit Committee shall meet at least at least two times in a year and not more than one hundred and eighty
days shall elapse between two meetings. .

The terms of reference of Audit Committee adheres to the requirements of Regulation 18 of the SEBI (LODR)
Regulation, 2015, proposed to be entered into with the Stock Exchange in due course.

The committee presently comprises the following 4 (Four) directors:

The Company Secretary & Compliance Officer of our Company shall act as the Secretary to the Audit Committee.

Set forth below are the scope, functions and the terms of reference of our Audit Committee, in accordance with
Section 177 of the Companies Act, 2013 and Regulation 18(3) of the SEBI (LODR) Regulation, 2015.

Meetings of Audit Committee and Quorum

As required under Regulation 18 of the SEBI (LODR) Regulation, 2015, the Audit Committee shall meet at least at
least two times in a year and not more than one hundred and eighty days shall elapse between two meetings.

The quorum shall be two members present, or one-third of the members, whichever is greater, provided that there
should be a minimum of two independent members present.

Powers of Audit Committee

The Audit Committee shall have powers, including the following:

To investigate any activity within its terms of reference;

To seek information from any employee;

To obtain outside legal or other professional advice; and

To secure attendance of outsiders with relevant expertise, if it considers necessary.

Role of Audit Committee

The role of the Audit Committee shall include the following:

Overseeing the Company’s financial reporting process and the disclosure of its financial information to ensure that
the financial statement is correct, sufficient and credible;

Recommending to the Board the appointment, re-appointment and replacement, remuneration and terms of
appointment of statutory auditor of the Company;

Reviewing and monitoring the statutory auditor’s independence and performance, and effectiveness of audit
process;

Approving payments to statutory auditors for any other services rendered by the statutory auditors of the Company;
Reviewing, with the management, the annual financial statements and auditor’s report thereon before s ubmission to
the Board for approval, with particular reference to:

Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s report in
terms of clause (c) of sub-Section 3 of Section 134 of the Companies Act, 2013, as amended;

Changes, if any, in accounting policies and practices and reasons for the same;

Major accounting entries involving estimates based on the exercise of judgment by the management;

Significant adjustments made in the financial statements arising out of audit findings;

Compliance with SEBI Listing Regulations and other legal requirements relating to financial statements;

Disclosure of any related party transactions; and
modified opinion(s) in the draft audit report.

Reviewing, with the management, the quarterly, half-yearly and annual financial statements before submission to
the board for approval;

Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue,
rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer
document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilization of
proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this
matter;

Approval or any subsequent modification of transactions of our Company with related parties and omnibus
approval for related party transactions proposed to be entered into by our Company subject to such conditions as
may be prescribed;

Formulating a policy on related party transactions, which shall include materiality of related party transactions;
Scrutinizing of inter-corporate loans and investments;

Valuing of undertakings or assets of the Company, wherever it is necessary;

Evaluating of internal financial controls and risk management systems;

Establishing a vigil mechanism for directors and employees to report their genuine concerns or grievances;

Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control
systems;

Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department,
staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal
audit;

Discussing with internal auditors of any significant findings and follow up there on;

Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected
fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the
Board;

Discussing with statutory auditors before the audit commences, about the nature and scope of audit as well as post¬
audit discussion to ascertain any area of concern;

Looking into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders
(in case of non-payment of declared dividends) and creditors;

Reviewing the functioning of the whistle blower mechanism;

Approving the appointment of the Chief Financial Officer (i.e., the whole-time Finance Director or any other
person heading the finance function or discharging that function) after assessing the qualifications, experience and
background, etc. of the candidate; and

Carrying out any other function as is mentioned in the terms of reference of the Audit Committee and any other
terms of reference as may be decided by the Board and / or specified / provided under the Companies Act, 2013 or
SEBI Listing Regulations or by any other regulatory authority.

Reviewing the utilization of loans and/ or advances from/investment by the holding company in the subsidiary
exceeding rupees 100 crore or 10% of the asset size of the subsidiary, whichever is lower including existing loans /
advances / investments existing as on the date of coming into force of this provision.

Considering and commenting on rationale, cost-benefits and impact of schemes involving merger, demerger,
amalgamation etc., on the listed entity and its shareholders.

Further, the Audit Committee shall mandatorily review the following information:

• Management discussion and analysis of financial condition and results of operations;

• Statement of significant related party transactions (as defined by the audit committee), submitted by
management;

• Management letters / letters of internal control weaknesses issued by the statutory auditors;

• Internal audit reports relating to internal control weaknesses; and

• The appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review
by the audit committee.

• Statement of deviations: (a) quarterly statement of deviation(s) including report of monitoring agency, if
applicable, submitted to stock exchange(s) in terms of Regulation 32(1); (b) annual statement of funds

utilized for purposes other than those stated in the offer document / prospectus / notice in terms of
Regulation 32(7).

Details of attendance at the Meeting of the Audit Committee

Stakeholders’ Relationship Committee

The Company has constituted a shareholder / investors grievance committee “Stakeholders’ Relationship
Committee” to redress complaints of the shareholders. The Stakeholders’ Relationship Committee was constituted
vide resolution passed at the meeting of the Board of Directors held on May 17, 2024.

The Stakeholders’ Relationship Committee comprises:

The Company Secretary & Compliance Officer of the Company shall act as the Secretary to the Stakeholders’
Relationship Committee.

The Stakeholders Relationship Committee shall oversee all matters pertaining to investors of our Company. The
scope and function of the Stakeholders’ Relationship Committee and its terms of reference shall include the
following:

Meetings

The Stakeholder’s Relationship Committee shall meet at least 1 (one) time in a year. The Chairperson of the
Stakeholders Relationship Committee shall be present at the annual general meetings to answer queries of the
security holders.

Role of the Stakeholders’ Relationship Committee

The Committee shall consider and resolve grievances of security holders, including but not limited to:

Resolving the grievances of the security holders of the listed entity including complaints related to
transfer/transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of
new/duplicate certificates, general meetings etc.

Review of measures taken for effective exercise of voting rights by shareholders.

Review of adherence to the service standards adopted by the listed entity in respect of various services being
rendered by the Registrar & Share Transfer Agent.

Review of the various measures and initiatives taken by the listed entity for reducing the quantum of unclaimed
dividends and ensuring timely receipt of dividend warrants/annual reports/statutory notices by the shareholders of
the company.

Details of attendance at the Meeting of the Stakeholders Relationship Committee

Nomination and Remuneration Committee

The Company has constituted a Nomination and Remuneration Committee in accordance Section 178 of
Companies Act, 2013. The constitution of the Nomination and Remuneration Committee was approved by a
Meeting of the Board of Directors held on May 17, 2024.

The Nomination and Remuneration Committee comprises the following Directors:

The Company Secretary & Compliance Officer of the Company shall act as the Secretary of the Nomination and
Remuneration Committee.

The scope and function of the Committee and its terms of reference shall include the following:

Meetings

The committee shall meet as and when the need arises for review of Managerial Remuneration. The quorum for a
meeting of the nomination and remuneration committee shall be either two members or one third of the members of
the committee, whichever is greater, including atleast one independent director in attendance.

Role of the Nomination and Remuneration Committee not limited to but includes:

Formulating the criteria for determining qualifications, positive attributes and independence of a director and
recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other
employees;

Formulating of criteria for evaluation of performance of independent Directors and the Board;

Devising a policy on Board diversity;

Identifying persons who are qualified to become directors of our Company and who may be appointed in senior
management in accordance with the criteria laid down, and recommend to the Board their appointment and
removal. Our Company shall disclose the remuneration policy and the evaluation criteria in its Annual Report of
our Company;

Whether to extend or continue the term of appointment of the independent director, on the basis of the report of
performance evaluation of independent directors.;

Recommend to the board, all remuneration, in whatever form, payable to senior management.

Details of attendance at the Meeting of the Nomination & Remuneration Committee

Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee shall formulate and recommend a CSR policy to the Board, the
Company has re-constituted a Corporate Social Responsibility Committee pursuant to resolution of the Board of
Directors dated May 17, 2024. The Corporate Social Responsibility Committee shall recommend the amount of
expenditure to be incurred on the CSR activities to be undertaken by the company, monitor the CSR policy of the
Company from time to time and establish the transparent controlling mechanism for the implementation of the CSR
projects or programs or activities undertaken by the company as per the requirements of the Companies Act, 2013,
Listing Agreement and SEBI LODR for Corporate Governance.

The Corporate Social Responsibility Committee comprises the following members:

Role of the Corporate Social Responsibility Committee not limited to but includes:

The Company Secretary & Compliance Officer of the Company shall act as the secretary to the Corporate Social
Responsibility Committee.

The CSR Committee shall -

Formulate and recommend to the Board, a CSR policy and activities to be undertaken by the company in areas or
subject, specified in Schedule VII;

Recommend the amount of expenditure to be incurred on the activities; and Monitor the Policy of the company
from time to time.

At the Company, the Managing Director takes on the role of the mentor, while the onus for the successful and time
bound implementation of the CSR activities / projects is on the HR Head and CSR teams.

Details of attendance at the Meeting of the CSR Committee

Internal Complaints Committee

An Internal Complaints Committee is constituted for the Company by the Board to look into the matters concerning
sexual harassment pursuant to resolution of the Board of Directors dated May 17, 2024. The Internal Complaints
consists of the following members.

During the financial year 2025-26, your Company has not received any complaints pertaining to sexual harassment
as summaries below:

Meeting of Independent Directors

Pursuant to Schedule IV of the Companies Act, 2013, the Independent Directors of the Company met on April 17,
2025 without the presence of the Non-Independent Directors and Members of the Management. The detail of
attendance at the said meeting of Independent Directors is given below:

The Independent Directors reviewed the performance of the Non-Independent Directors and the Board of Directors
as a whole for FY 2025 and assessed the quality, quantity and timeliness of flow of information between the
Company management and the Board of Directors that is necessary for the Board to perform their duties effectively
and reasonably for FY 2025.

BOARD EVALUATION

A formal annual evaluation is required to be made by the Board of its own performance and that of its Committees
and individual Directors. Section 178(2) of the Companies Act, 2013 requires the Nomination and Remuneration
Committee to specify the manner for effective evaluation of the performance of the Board, its Committees and
individual Directors. The Board of Directors carried out the annual performance evaluation of the Board, its
Committees, Individual Directors and Chairperson during the year under review pursuant to the provisions of the
Companies Act, 2013 and SEBI Listing Regulations

DETAILS OF GENERAL BODY MEETINGS

The details of General Meetings of the Company held during the year and the special resolutions passed at the said
meetings are as given below:

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The particulars of loans, investments and guarantees for FY 2025-26 have been provided in the notes to

the Financial Statements of the Company.

PARTICULARS OF EMPLOYEE

None of the employee has received remuneration exceeding the limit as stated in rule 5(2) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

RELATED PARTY TRANSACTIONS

The particulars of contracts or arrangements with related parties referred to in Section188 (1) of the
Companies Act 2013 for the Financial Year 2025-26 in the prescribed format-AOC2 has been enclosed
with the report as Annexure - II.

COST RECORDS

The Company is required to maintain records as specified by the Central Government under sub¬
section^) of section 148 of the Companies Act, 2013 and accordingly such accounts and records are made
and maintained.

RISK MANAGEMENT

The Directors of the Company continuously assess the risk the company is exposed to which in their
opinion threaten the existence of the company and take suitable preventive steps to mitigate the risk. In
the opinion of the directors there are no perceivable risks threatening the existence of the company.

EXTRACT OF THE ANNUAL RETURN

In accordance with Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 (‘the Act’), the annual return
in Form MGT-7 is placed on the website of the Company and is available atwww.subampapers.com

DISCLOSURE ON ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company believes in the conduct of the affairs in a fair and transparent manner by adopting highest standards
of professionalism, honesty, integrity and ethical behavior. The Company has implemented a vigil mechanism to
provide a framework for the Company’s employees and Directors to promote responsible and secure whistle
blowing.

The Company has established a Board approved policy on whistle blowing and separate email addresses are
designated wherein the employees or the stakeholders can report the matters falling under the purview of Vigil
Mechanism. There was no complaint received under this category during the Financial Year ended March 31, 2026.

COMPLIANCE WITH THE SECRETARIAL STANDARDS

The Company has complied with all the applicable Secretarial Standards issued by the Institute of Company
Secretaries of India (ICSI).

INTERNAL FINANCIAL CONTROLS

In accordance with Section 134(5) (e) of the Companies Act, 2013, the Company has Internal Financial Controls
Policy by means of Policies and Procedures commensurate with the size and nature of its operations and pertaining
to financial reporting. In accordance with Rule 8(5) (viii) of Companies (Accounts) Rules2014,it is hereby
confirmed that the Internal Financial Controls are adequate with reference to the financial statements.

IBC 2016 PROCEEDINGS

The Company has not filed any application or has any proceeding pending under the Insolvency and Bankruptcy
Code, 2016 during the year.

DETAILS OF ONE-TIME SETTLEMENT (OTS)

The Company has not made any application for OTS before any Bank, Financial Institution or any other lender
during the year.

COMPLIANCE WITH MATERNITY BENEFIT ACT

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

SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS:

There are no significant and material order passed by the regulators or courts or tribunals impacting the going
concern status and the Company’s operations in future.

STATEMENT OF UTILIZATION OF FUNDS:

In accordance with provisions of Regulation 33 of SEBI (LODR), Regulations, 2015, there are no deviations or
variations on utilisation of funds. The funds have been utilized in the manner as specified in its offer document.

CAUTIONARY STATEMENT

Certain statements made in this report relating to the Company’s objectives, projections, outlook, expectations,
estimates, among others may constitute ‘forward-looking statements’ within the meaning of applicable laws and

regulations. Actual results may differ from such expectations, projections etc., whether express or implied. Several
factors could make a significant difference to the Company’s operations. These include climatic conditions,
economic conditions affecting demand and supply, government regulations and taxation, natural calamity, currency
rate changes, among others over which the Company does not have any direct control.

ACKNOWLEDGEMENT

Your Directors take this opportunity to place on record their sincere thanks to Bank for their valuable support and
look forward to their continued co-operation in the years to come. Your Directors acknowledge the support and co¬
operation received from the employees and all thosewho have helped in the day to day management.

By Order of the Board

For Subam Papers Limited

Place : Tirunelveli Managing Director Director

T Balakumar RamasubbuVenkatesh

Date: 26/05/2026 DIN:00440500 DIN:00951835