Board's Report

To the Members of Patel Engineering Limited,

Your Directors hereby present the 74^th Board's Report on the business, operations and state of affairs of the Company together with the
audited financial statements for the year ended March 31, 2023:

FINANCIAL PERFORMANCEStandalone and Consolidated

Consolidated:

The Consolidated total income for FY 2023 stood at ' 43,223.24
million as against ' 34,965.11 million for the previous year. The
Net profit for the year ended March 31, 2023 was at
' 1,548.06 million as against Net profit of ' 550.06 million for
the previous year.

Standalone:

On Standalone basis, the total income for FY 2023 stood at
' 39,613.97 million as against ' 31,647.75 million for the
previous year. The Net Profit for the year ended March 31, 2023
was at ' 1,558.53 million as against Net profit of ' 563.91
million for the previous year.

Dividend

To conserve funds, the Directors have not recommended payment
of dividend for the financial year 2022-23.

Pursuant to Regulation 43A of the SEBI (Listing Obligations

& Disclosure Requirements) Regulations, 2015, the Dividend

Distribution Policy is available on the website of the Company at

the link: https://tinyurl.com/54cvkwz9.

Share Capital

During the year under review:

i. 2,39,61,525 equity Shares of the face value of ' 1 each
were allotted to Patel Engineering Employees' Welfare Trust.

ii. 1,25,52,800 equity shares were allotted to AFRIN DIA
(FPI Category - I) at an issue price of ' 25.36 each under
preferential basis.

iii. 25,78,72,409 equity shares of the face value of ' 1 each
were allotted on Rights Issue basis at an issue price of
' 12.60 each.

Consequently, as at March 31, 2023, the total paid-up share
capital of the Company stood at ' 77,36,17,228 divided into
77,36,17,228 Equity Shares of ' 1 each.

Information on state of affairs of the Company

Information on the operational and financial performance, among
others, is given in the Management Discussion and Analysis
Report, forming part of the Annual Report and is in accordance
with the SEBI (Listing Obligation and Disclosure Requirements)
Regulations, 2015 ("SEBI LODR Regulations").

Merger of Subsidiaries

During 2022-23, Merger by Absorption of 14 wholly owned
subsidiaries viz. Patel Energy Resources Ltd; PEL Power Ltd;

PEL Port Pvt Ltd; Patel Energy Projects Pvt Ltd; Patel Energy
Assignment Pvt Ltd; Patel Energy Operations Pvt Ltd; Jayshe Gas
Power Pvt Ltd; Patel Thermal Energy Pvt Ltd; Patel Hydro Power
Pvt Ltd; Zeus Minerals Trading Pvt Ltd; Patel Concrete & Quarries
Pvt Ltd; Patel Lands Ltd; Patel Engineers Pvt Ltd and Phedra
Projects Pvt. Ltd with the Company was approved by the Hon'ble
National Company Law Tribunal, Mumbai and Hyderabad Bench
to combine business interest into one corporate entity, resulting
in operational synergies, simplification, streamlining and
optimization of the group structure and efficient administration.

Borrowing

The total long-term borrowings stood at ' 15,421.76 million as
on March 31, 2023 as against ' 19,907.07 million as on March
31, 2022.

Subsidiaries & Associates

As on March 31, 2023, the Company has 53 subsidiaries including
step down subsidiaries.

Highlights of performance of key subsidiaries/Associates

Michigan Engineers Private Limited (Michigan) having presence
in urban infrastructure Projects, mostly in Mumbai, has achieved
the revenue of ' 3,200 million and profit of ' 351.70 million in
FY 23. It has an order book of around ' 20,000 million. Michigan
successfully launched its TBM for the longest 2.6 meter ID
segmental tunnel in India of 6.5 km and has completed more
than 1 km of the tunnel by March 31, 2023.

The Company is in discussion to monetize and hive-off its stake
in Michigan.

Raichur Sholapur Transmission Company Private Limited (RSTCPL)
commissioned 765 kV single circuit transmission line between
Raichur and Sholapur in July 2014. The stake in RSTCPL has been
sold during the year under review to India Grid Trust by all the
shareholders/partners of RSTCPL and the Company along with
the partners of RSTCPL got released the corporate guarantees
of approximately ' 2,400 million given for the loan availed by
RSTCPL.

Dirang Energy Private Limited (Dirang), a Special Purpose
Company for development of 144MW Gongri Hydroelectric
Power Project in West Kameng District in Arunachal Pradesh. In
accordance with the terms of the Memorandum of Agreement
dated May 18, 2007 (as amended by Amendment Agreement
dated August 5, 2021) the Company has started the Arbitration
proceedings in the matter against the Govt. of Arunachal
Pradesh. Currently the arbitration is at the stage of evidence and
the next dates are yet to be fixed, in view of a request to the
arbitrator to adjourn the hearing to a later date given that the
parties are engaging in discussions to settle the disputes.

Patel KNR Infrastructures Ltd and Patel KNR Heavy Infrastructures
Limited continue to remain the same. The Company holds
substantial stake in these road project companies. Both the
NHAI annuity projects are under operation and the respective
companies are receiving the annuity on semi-annual basis. The
respective Companies are maintaining the assets as per the
contract conditions.

PBSR Developers Private Limited, is developing the project
consisting two residential towers (each tower having 20 floors)
comprising of residential units of 2 BHK, 2.5 BHK and 3 BHK
and one tower of serviced apartments (19 floors). The residential
towers have 12 flats per floor and service apartment block have
11 units per floor. PBSR has applied for the Occupancy Certificate
(OC) for Smondo Gachibowli project to Greater Hyderabad
Municipal Corporation (GHMC) and started handing over of the
flats to buyers. PBSR needed to handover total area to GHMC out
of project land parcel, which Company have registered in GHMC's
favour. However, the adjoining layout resident's association has
created certain disputes in this regard, Company is in the process
of resolving said disputes, post which OC shall be released.

The Company's Mauritius subsidiary Les Salines Development
Ltd (LSDL) had lease Agreement for development of 24.6215
hectares of land for residential, commercial, leisure and shopping
etc with Government of Mauritius (GOM) for a period of 99
years. In February 2015, suddenly GOM had terminated the lease
without assigning any reason. After termination of the project,
the Company had issued a notice of arbitration to GOM for
expropriation of investment under bilateral treaty between India
and Mauritius for promotion and protection of investment in
both countries. The Arbitration process has been completed and
the Company is expecting a favourable award for the same.

The salient features of the financial statement of each of the
subsidiaries and the associates as required under the Companies
Act, 2013 is provided in Annexure I of the Boards' Report.
Pursuant to the provisions of Section 136 of the Act, the
financial statements of the Company, consolidated financial

statements along with relevant documents and separate audited
financial statements in respect of the subsidiaries are available
on the website of the Company at www.pateleng.com.

In terms of SEBI LODR Regulations the Company has formulated
a policy for determining 'material' subsidiaries and the same
has been disclosed on Company's website at the following link:
https://tinyurl.com/235xsrxw.

Particulars of Loans given, Investment made, Guarantees
given and Securities provided

The members may note that the Company is engaged in providini
infrastructural facilities and hence, as per Section 186(11) of
Companies Act, 2013, nothing in Section 186 shall apply to the
Company except sub-section (1) of Section 186. Accordingly,
a separate disclosure has not been given in the financial
statements as required under Section 186(4) with regard to
particulars of loan given, investment made or guarantee given
or security provided and the purpose for which the loan or
guarantee or security is proposed to be utilized by the recipient
of the loan or guarantee or security.

Related Party Transactions

All contracts/arrangement/transactions entered into by the
Company during FY 23 with related parties were in compliance
with the applicable provisions of the Companies Act, 2013 and
the SEBI LODR Regulations.

All related party transactions entered into during FY 23 were
on an arm's length basis and in the ordinary course of business
of the Company under the Act and not material under the SEBI
LODR Regulations. None of the transactions required members'
prior approval under the Act or the SEBI LODR Regulations.

Details of transactions with related parties during FY 23 are
provided in the notes to the financial statements. There were
no transactions requiring disclosure under section 134(3)of the
Companies Act, 2013. Hence, the prescribed Form AOC-2 does
not form a part of this report.

In accordance with the provisions of SEBI LODR Regulations, the
Company has formulated the Related Party Transactions policy
and the same is uploaded on Company's website at the link:
https://tinvurl.com/2p94ifvw.

Directors and Key Managerial Personnel

i. Independent Directors

The Board has appointed the below mentioned Directors as
Independent Directors during the year under review:

1. Dr. Sunanda Rajendran effective from March 24, 2023

2. Mr. Shambhu Singh effective from March 01, 2023

3. Mr. Ashwin Parmar effective from April 20, 2023

The appointment of the above mentioned Directors is
subject to approval of members for which Postal Ballot
Notice dated April 20, 2023 was circulated to the members
for approval.

The necessary declarations with respect to independence
has been received from all the Independent Directors of the
Company and that the Independent Directors have complied
with the Code for Independent Directors prescribed in Schedule
IV to the Companies Act, 2013. Further Board confirms
compliance with the Code of Conduct for Directors and senior
management personnel as formulated by the Company.

ii. Other Directors / Key Managerial Personnel

Mr. Rupen Patel retires by rotation at the ensuing Annual
General Meeting and being eligible, offers himself for re¬
appointment.

There is no change in the Key Managerial Personnel (KMPs).
Some of the KMPs of the Company are also the Directors/
KMPs of the subsidiaries.

Number of Board Meetings

During the year ended March 31, 2023, the Board met 10 times.
The meeting of the Board of Directors of the Company were held
on May 13, 2022, May 23, 2022, July 28, 2022, August 08, 2022,
September 07, 2022, October 29, 2022, November 11, 2022,
December 09, 2022, December 16, 2022 and February 08, 2023.

Nomination and Remuneration Policy

The Company has formulated a Nomination and Remuneration
Policy pursuant to Section 178 of the Companies Act, 2013 and
SEBI LODR Regulations. The salient features of the Policy is
enclosed as Annexure II to the Boards' Report.

Evaluation of the performance of the Board

Based on Boards' Evaluation Policy, the performance of the
Board Directors, its Committees, Chairman, Executive Directors,
Independent Directors and Non-executive Directors were
evaluated pursuant to the Provisions of Companies Act, 2013 and
SEBI LODR Regulations.

A separate meeting of Independent Directors was held during the
year under review wherein, the Independent Directors evaluated
the performance of the non-independent directors, the Board as
a whole and the Chairman of the Company.

Internal Financial Controls and Risk Management

The Company has in place adequate internal financial control
with reference to financial statement. The Company ensures
operational efficiency, protection and conservation of resources,
accuracy in financial reporting and compliance with laws and

regulations. The internal control system is supported by an
internal audit process.

Pursuant to SEBI (Listing Obligation and Disclosure
Requirements) (Second Amendment) Regulations, 2021, the Risk
Management Committee was reconstituted to frame, implement
and monitor the risk management policy for the Company. The
Committee shall be responsible for monitoring and reviewing the
risk management plan and ensuring its effectiveness. The Audit
Committee has additional oversight in the area of financial risks
and controls. The major risks identified by the businesses and
functions shall be systematically addressed through mitigating
actions on a continuing basis.

Audit Committee

The Audit Committee presently comprises of:

Mr. K. Ramasubramanian - Independent Director (Chairman of the
Committee)

Mr. Rupen Patel - Chairman & Managing Director
Dr. Barendra Bhoi - Independent Director
Whistle Blower Policy

The Company has adopted a Whistle Blower Policy to comply
with the principles of Business Responsibility and Sustainability
Reporting (BRS reporting) as amended by SEBI. The Policy
provides a formal mechanism for director(s) /stakeholder(s) to
report concerns about unethical behavior, actual or suspected
fraud or violation of the Company's Ethics and Code of Conduct.
The Policy is uploaded on the Company's website at the link
https://tinvurl.com/2sxkrt7t.

This Policy provides for adequate safeguards against victimization
of Director(s) /stakeholder(s) and provides opportunity to
director(s)/ stakeholder(s) to access in good faith, to the ABMS
(Anti Bribery Management System) Committee in case they
observe Unethical and Improper Practices or any other wrongful
conduct in the Company.

The vigil mechanism is overseen by the Audit Committee. There
are no complaints / grievances received from any Directors/
stakeholders of the Company under this policy.

Corporate Social Responsibility

In accordance with the provisions of Section 135 of the
Companies Act, 2013 (the Act), the Board of Directors of the
Company has constituted the Corporate Social Responsibility
Committee (CSR Committee) comprising of the following
Directors as its members:

Mr. Rupen Patel - Chairman & Managing Director
Ms. Kavita Shirvaikar - Whole time Director & CFO

Mr. K. Ramasubramanian - Independent Director

The Company's CSR Policy as uploaded on the Company's website
at the link: https://tinyurl.com/ptvdfbs3.

Pursuant to Clause (o) of Sub-Section (3) of Section 134 of the
Act and Rule 8 of Companies (Corporate Social Responsibility
Rules, 2014, the CSR Report forms part of the Board Report
as Annexure III. The Company has initiated spending on CSR
activities as detailed in the CSR Report.

Statutory Audit

M/s Vatsaraj & Co. (FRN: 111327W), the Statutory Auditors of
the Company hold office until the conclusion of the 78^th AGM to
be held in the year 2027. Pursuant to Section 141 of the Act,
the Auditors have represented that they are not disqualified and
continue to be eligible to act as the Auditor of the Company.

The Notes on financial statement 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.

Branch Audit

In accordance with the provisions of Section 139 and 143(8) of
the Act, M/s. N. H. Karnesh & Associates has been appointed as
Branch Auditor for the Realty Division of the Company for a term
of 5 years to hold office until the conclusion of the 77^th AGM to
be held in the year 2026.

The Company has appointed M/s. R K Agrawal & Associates, as
Branch Auditor of the Company for Arun 3 H.E. Project, Nepal for
FY 2022-23.

Secretarial Audit

The Board of Directors appointed M/s. MMJB & Associates LLP,
Company Secretaries to conduct Secretarial Audit of the Company
for the financial year ended March 31, 2023. The Report of the
Secretarial Auditor is provided as Annexure IV to this Report.

The Secretarial Audit Report does not contain any qualification,
reservation, adverse remarks or disclaimer except 1 with respect
to delay in prior intimation in terms of Regulation 29(3) of SEBI
LODR Regulations to the stock exchanges about the meeting of
the Board of Directors for considering proposal for alteration in
terms of non-convertible debentures issued by the Company. The
shareholders may note that the Company had given 4 days prior
notice instead of 11 days as per the SEBI LODR Regulations. BSE
Limited and National Stock Exchange of India Limited imposed a
fine of ' 11,800 respectively for the said non-compliance and the
Company has paid the same.

Cost Audit

As per Section 148 of the Act, the Company is required to have
the audit of its cost records conducted by a Cost Accountant. The
Board of Directors of the Company has on the recommendation

of the Audit Committee, approved the appointment of M/s.

Rahul Jain & Associates., a firm of Cost Accountants in Practice
(Registration No. 101515) as the Cost Auditors of the Company
to conduct cost audits under the Companies (Cost Records
and Audit) Rules, 2014 for the year ending March 31, 2023.

The Board on recommendations of the Audit Committee have
approved the remuneration payable to the Cost Auditor subject
to ratification of their remuneration by the Members at the
forthcoming AGM. M/s Rahul Jain & Associates have, under
Section 139(1) of the Act and the Rules framed thereunder
furnished a certificate of their eligibility and consent for
appointment.

The cost accounts and records of the Company are duly prepared
and maintained as required under Section 148(1) of Act.

Prevention of sexual harassment of Women at workplace

The Company has a Policy on Prevention of Sexual Harassment
of Women at Workplace. No cases were reported during the year
under review. The Company has complied with the provisions
relating to the constitution of Internal Complaints Committee
under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.

Conservation of Energy, Technology Absorption and Foreign
Exchange Earnings/ Outgo

The particulars prescribed under Section 134 of the Act, read
with Rule 8 (3) of the Companies (Accounts) Rules, 2014,
relating to Conservation of Energy, Technology Absorption,

Foreign Exchange Earnings / Outgo is provided as Annexure V to
this Report.

Annual Return

Pursuant to Section 92 and 134 of the Act, the Annual Return as
at March 31, 2023 in Form MGT-7, is available on the website of
the Company at the link https://tinyurl.com/3zspdz4a.

Disclosure under Section 197 of the Companies Act, 2013

In accordance with the provisions of Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel)

Rules, 2014, the particulars of the employees are set out in the
annexure to this Report. In terms of the provisions of Section
136 of the Act, the Report is being sent to the Members of the
Company excluding the annexure. Any member interested in
obtaining a copy of the annexure may write to the Company
Secretary at the Registered Office of the Company.

Further, disclosures on managerial remuneration as required
under Section 197 read with Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules,
2014 are provided as Annexure VI to this Report.

Corporate Governance

Pursuant to SEBI LODR Regulations, the Report on Corporate
Governance together with the certificate issued by M/s. Vatsaraj
& Co., the Statutory Auditors of the Company, on compliance in
this regard forms part of the Annual Report.

Employee Stock Option / General Benefits Scheme

The Company currently has two Schemes for its employees viz
Patel Engineering Employee Stock Option Plan 2007 and Patel
Engineering General Employee Benefits Scheme 2015.

The applicable disclosure under SEBI (share Based employee
Benefits) Regulations, 2014 ("the ESOP Regulations") as at
March 31, 2023 is uploaded on the Company's website at the link
https://tinyurl.com/3dmuvhcu.

A Certificate from the Secretarial Auditors of the Company in
terms of Regulation 13 of ESOP Regulations would be available at
the ensuing AGM.

Other Disclosures

i) There are 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
Boards' report.

ii) No orders have been passed by any Regulator or Court
or Tribunal which can have impact on the going concern
status and the Company's operations in future during the
year under review.

iii) The Company has not accepted or renewed any amount
falling within the purview of provisions of Section 73 of the
Companies Act, 2013 read with the Companies (Acceptance
of Deposit) Rules, 2014 during the year under review.

Hence, the requirement for furnishing of details relating

to deposits covered under Chapter V of the said Act or the
details of deposits which are not in compliance with the
Chapter V of the said Act is not applicable.

iv) The Company has complied with the Secretarial Standards
issued by the Institute of Company Secretaries of India.

v) No fraud has been reported by the Auditors, to the Audit
Committee and the Board.

vi) The Company has not initiated any proceeding under the
Insolvency and Bankruptcy Code, 2016 (IBC).

There are 7 proceedings initiated/pending against our
Company under IBC which does not materially impact
the business of the Company. Out of 7 proceedings, 3
proceedings are settled and pending for disposal and
withdrawal. 4 proceedings are disputed and pending for
hearing.

Directors' Responsibility Statement

Pursuant to Section 134 of the Companies Act, 2013, the

Directors confirm that:

i. in preparation of the annual accounts, the applicable
accounting standards have been followed;

ii. such accounting policies have been applied consistently
and judgments and estimates that are reasonable and
prudent have been made so as to give a true and fair view
of the state of affairs of the Company and of the Profit and
Loss of the Company for the year ended March 31, 2023;

iii. proper and sufficient care has been taken 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;

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

v. internal financial controls were followed by the Company
and the same are adequate and were operating effectively;
and

vi. proper systems has been devised to ensure compliance with
the provisions of all applicable laws and that such systems
were adequate and operating effectively.

Acknowledgements

The Board of Directors wish to place on record their appreciation
for continued support and co-operation by Shareholders,
Financial Institutions, Banks, Government Authorities and
other Stakeholders. Your Directors would also like to take this
opportunity to express their appreciation for the dedicated
efforts of the employees of the Company.

For and on behalf of the Board of Directors,
Patel Engineering Limited

Rupen Patel

May 15, 2023 Chairman & Managing Director

MumbaiDIN: 00029583