United Drilling Tools Ltd

Dear Shareholders / Members,

The Board of Directors are pleased to present the 42nd Annual Report of the United Drilling Tools Limited ("UDTL"). This report, inter- alia, includes the audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31,2024 (FY 2023-24), in accordance with the Companies Act, 2013 (including any amendments thereto currently in force) ("the Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this report offers an overview of the financial results and significant developments of United Drilling Tools Limited and its subsidiaries for the Financial Year ended March 31, 2024.

The Audited Financial Statements of your Company as on March 31,2024, are prepared in accordance with the relevant applicable Indian Accounting Standards ("Ind AS") and the provisions of the Companies Act, 2013 ("Act").

(Rs. in Lacs)

UDTL stands at the forefront of innovation in the oil and gas industry, continually integrating cutting-edge technologies into its product offerings. This commitment enhances the technological advantages available to its clients, driving efficiency and reliability in operations. With a dedicated team of experienced engineers and support personnel, UDTL provides robust technical support and expertise throughout all stages, including comprehensive after-sales services to our customers.

The Company's extensive product lines cater comprehensively to the needs of the industry. Specializing in wireline and slickline solutions, UDTL serves as a trusted single-source provider, offering a wide array of tools and equipment designed for precision and durability in challenging environments. Each product undergoes rigorous testing and adheres to stringent quality standards, including ISO certification and compliance with American Petroleum Institute (API) specifications.

UDTL's commitment to excellence is further underscored by its state-of-the-art manufacturing facilities, strategically located to support global operations. These facilities not only ensure high-quality production but also enable swift response times and efficient logistics management. Additionally, the Company's upcoming Greenfield manufacturing unit near Mundra port in Gujarat signifies its proactive approach to expanding capacity and enhancing technological capabilities. A new cutting-edge Greenfield manufacturing unit focused on technology is set to commence operations near Mundra port in Gujarat soon.

By staying at the forefront of technological advancements and maintaining a dedicated focus on customer satisfaction, UDTL continues to set benchmarks in the industry. Its ability to innovate, coupled with a strong foundation of technical expertise and comprehensive product offerings, reinforces its position as a preferred partner for oil and gas companies worldwide.

The Company operates four state-of-the-art manufacturing facilities with a proven track record of producing high-quality products. These facilities adhere to international standards such as ISO 9001:2015, ISO 45001:2018, 14001:2015, and are certified by the American Petroleum Institute (API License No. 5CT-0565, 5L-0424, 7-1-0393, 19G1-0008, 19G2-0010).

UDTL has recently introduced a range of innovative products, including UDT Chaser Subs / Drive Subs, UDT Circulating Head, UDT Crossovers & Pup Joints, UDT Anti-Rotation Device (Shear Tool), UDT Telescopic Mastline Unit, and UDT BOP Control System for Truck-Mounted Slickline Winches. Additionally, the Company has launched the UDT Hydraulic Testing Unit for Truck-Mounted Slickline Winches. These advancements highlight UDTL's commitment to developing cutting-edge solutions that enhance efficiency and safety in the oil and gas industry. Each product is designed with precision engineering and undergoes rigorous testing to meet the highest quality standards, ensuring reliability and performance in challenging operational environments.

The Company achieved significant technological advancements in the manufacturing of several of our products, including wireline winches and multi-start connectors. These enhancements underscore our commitment to innovation and improving performance standards across our product lines.

The Company's several key initiatives, such as establishing our marketing agents in new countries, actively participating in major oil and gas conferences, and notably, joining the India Energy Week, which was graced by our Prime Minister. These efforts are part of our strategic approach to expanding our global presence and fostering valuable partnerships in the energy sector.

During year under review FY 2023-24, the Company has undertaken significant initiatives in the realm of research and development, consistently innovating to introduce new products and enhance the performance of our existing lineup. This proactive approach underscores our commitment to staying at the forefront of technological advancements in our industry. The Company has embarked on major initiatives, including the development of additional sizes of connectors and the introduction of new types of winches. These efforts reflect our commitment to expanding our product offerings and meeting diverse market demands with innovative solutions.

UDTL Group works closely with prominent entities like ONGC, Oil India, Focus Energy, GeoEnpro, Jindal Drilling, and Welspun in India. Internationally, we collaborate with well-known brands such as Halliburton, Schlumberger,

Shelf Drilling, Aramco, ACT, Adnoc, Pitman and Kuwait Oil Company. Our revenue comes from government organizations, private sector companies, and exports in the oil and gas industries, showcasing our broad reach and trusted partnerships worldwide.

During the Year under review, the Board of Directors have declared and paid two interim dividends aggregating 12% i.e; Rs. 1.20/- per equity share of Rs. 10/- each.

The Directors have also recommended a final dividend @ 6% i.e; Rs. 0.60/- per equity share of Rs. 10/- each based on the parameters laid down in the Policy and such dividend will be paid out of the distributable profits for the year.

The Final dividend will be disbursed, subject to approval by the Members at the ensuing Annual General Meeting ("AGM"), to those members, whose names are listed in the Register of Members (including Beneficial Owners) maintained by the Depositories as of the Record Date i.e., August 27, 2024. The Final Dividend will be paid to entitled shareholders on or after the specified date, with deduction of Tax Deducted at Source (TDS) at rates as prescribed under the Income Tax Act, 1961.

The Information regarding outstanding and unclaimed dividends previously declared and paid by your Company can be found in the Corporate Governance Report, included as part of this Annual Report.

The unclaimed and un-encashed dividends for the Financial year 2016-17 (Final Dividend) will be transferred to the Investor Education and Protection Fund (IEPF) on or before due date prescribed under IEPF rules. Additionally, shares corresponding to dividends unclaimed for seven consecutive years will also be transferred to the IEPF in accordance with the IEPF Rules. The year-wise amounts of unclaimed or un-encashed dividends in the unpaid dividend account up to the current year, and information on corresponding shares eligible for transfer can be found in the shareholder information section of the Corporate Governance Report included in this Annual Report. These details are also accessible on your Company's web-site https://udtltd.com/ investor-home/shareholder-information/dividend.

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ('SEBI Listing Regulations') the Board of Directors of the Company (the 'Board') had formulated and adopted a Dividend Distribution Policy (the 'Policy') and same is available on the website of the Company i.e; https://udtltd.com/policies/.

During the year under review, the Company has not altered/ modified its authorised share capital and has not issued any shares including equity shares with differential rights as to dividend, voting or otherwise. The Company has not issued any sweat equity shares to its directors or employees.

The Paid-up Share Capital of the Company as on March 31,2024 is Rs. 20,30,31,260/- divided into 2,03,03,126 Equity Shares of H10/- each fully paid up.

UDTL's Equity Shares remain listed on both the domestic stock exchanges, namely BSE Limited and National Stock Exchange of India Limited. Additionally, both NSDL and CDSL, the depositories, continue to provide their services to our esteemed shareholders/members. For the Financial Year 2024-25, your Company has duly paid the annual fees to all these entities.

During the financial year under review, Your company did not accept any deposits as defined under Section 73 or 74 of the Companies Act, read with the Companies (Acceptance of Deposits) Rules, 2014 at the end of FY 2024, there were no outstanding amounts on account of principal or interest on deposits from the public during this period.

The rating agency has consistently upheld a BBB (STABLE) rating for the Company throughout FY 2023 and FY 2024, underscoring its strong commitment to sound financial management. This reaffirms the trust and reputation the Company has earned for its consistent ability to meet financial obligations and its unwavering dedication to stakeholders.

The consolidated financial statements of the Company and its subsidiaries for FY 2023-24 have been prepared in compliance with the applicable provisions of the Companies Act, 2013 ('the Act') and as stipulated under Regulation 33 of SEBI Listing Regulations as well as in accordance with the Indian Accounting Standards notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time.

During the FY24, the Company has 1 (one) Wholly-owned Subsidiary. There have been no changes in the status of subsidiaries, joint ventures, or associate companies. Furthermore, pursuant to the provisions of Section 129, 134 and 136 of the Act read with rules made thereunder and Regulation 33 of the SEBI Listing Regulations, Your Company prepared consolidated financial statements of the Company and its subsidiary, along with a statement highlighting the key financials of the Company's subsidiaries in Form AOC-1, are included in the Annual Report under "Annexure-1".

The statement also provides the details of performance, financial positions of the subsidiary Company. As per the provisions of Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and other related information of the Company and audited financial statements of its subsidiary, are available on the website of the Company i.e; www. udtltd.com. These documents will also be available for inspection during business hours at our registered office till date of annual general meeting.

The policy for determining material subsidiaries may be accessed on the Company's website at https://udtltd.com/ policies/.

During the year under review, M/s R S Dani & Co., Chartered Accountants (FRN-000243C), the Statutory Auditors of the Company, have tendered their resignation vide letter dated August 14, 2023, citing completion of 10 years as Statutory Auditors, leading to the creation of a casual vacancy as per the provisions of sub-section (8) of section 139 of the Companies Act, 2013. Subsequently, the Board filled the casual vacancy by appointing M/s Sarupria Somani & Associates, Chartered Accountants (ICAI Firm Registration No. 010674C), as Statutory Auditors of the Company at a meeting held on August 14, 2023. Their appointment was confirmed and approved by the members of the Company at the 41st Annual General Meeting held on September 26, 2023.

M/s R S Dani & Co., (FRN-000243C) having issued a Limited Review Report on the unaudited financial results for the 1st quarter ended June 30, 2023, and the rest quarter's limited review report on unaudited financial results for the FY 202324 were issued by M/s Sarupria Somani & Associates as Statutory Auditors of the Company.

The members had approved the appointment of M/s Sarupria Somani & Associates, Chartered Accountants, (ICAI Firm Registration No. 010674C) as Statutory Auditors of the Company from the conclusion of 41st Annual General Meeting upto the conclusion of 43rd Annual General Meeting to be held in the calendar year 2025.

The Financial statements of the Company for the FY 202324 were audited by the M/s Sarupria Somani & Associates, Chartered Accountants (ICAI Firm Registration No. 010674C). Accordingly, their audit report along with audited financial statements for the said FY are being placed before the respected shareholders / members for their consideration and adoption. The Notes on the financial statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments. There are no audit qualifications, reservations, disclaimers or adverse remarks, or reporting of fraud in the Statutory Auditors Report given by M/s Sarupria Somani & Associates, Chartered Accountants, (ICAI Firm Registration No. 010674C) of the Company for the financial year 2023-24 annexed in this Annual Report.

M/s Sarupria Somani & Associates, Chartered Accountants (ICAI Firm Registration No. 010674C) have confirm that they are not disqualified as statutory auditors of the company as per the provisions of Companies Act, 2013.

In term of the provision of Section 204 of the Company Act, 2013, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s Balraj Sharma & Associates, Company Secretaries, New Delhi as Secretarial Auditors of the Company for the financial year ended March 31, 2024.

The Company provided all assistance and facilities to the Secretarial Auditor for conducting their audit. The report of the Secretarial Auditors in Form MR-3 forms part of the Directors' Report as "Annexure-2".

There are no audit qualifications, reservations, disclaimers, or adverse remarks in the said Secretarial Audit Report. Your Company complies with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs.

M/s APU & Co., Chartered Accountants, represented by CA Ankur Jain, the internal auditors of the company, have tendered their resignation on November 10, 2023, citing unwillingness to continue due to pre-existing commitments. The Board considered and accepted the resignation of the aforementioned internal auditor during a meeting held on November 10, 2023.

Following the cessation of M/s APU & Co., Chartered Accountants, as Internal Auditor of the Company, the Board has appointed, based on the recommendation of the audit committee, M/s Grover Lalla & Mehta, Chartered Accountants (ICAI Firm Registration No. - 002830N), represented by Mr. Pankaj Bansal, as internal auditors of the Company for the remaining period of FY 2023-24, as stipulated under Section 138 of the Companies Act, 2013.

M/s Grover Lalla & Mehta underscores commitment to upholding high standards of corporate governance and ensuring sound financial management practices. Their experience and specialization in Taxation, Finance, and Accounts equip them well to fulfill their responsibilities diligently and contribute positively to your Company's growth and sustainability objectives during FY24 and beyond.

The Internal auditors have submitted quarterly reports to the Company's Audit Committee. Their reports do not contain any qualifications, reservations, or adverse remarks.

During the year under review, your Company has complied with Section 148(1) of the Act by maintaining accounts and cost records as prescribed by the Central Government. These cost accounts and records are subject to audit by M/s Swati Chaturvedi, Practicing Cost Accountants (Firm Registration Number: 100664), for FY2023-24.

The Board of Directors has re-appointed M/s Swati Chaturvedi, Practicing Cost Accountants (Firm Registration Number: 100664), as the Cost Auditors of our Company for the Financial Year 2024-25 for conducting the cost audit in compliance with regulatory requirements, a resolution seeking shareholder approval for ratifying the remuneration payable to the Cost Auditors for FY 2024-25 has been included in the Notice convening the forthcoming Annual General Meeting (AGM).

The cost accounts and records as required to be maintained under section 148 (1) of the Act are duly made and maintained by your Company.

The Company has undertaken an audit for the Financial Year ended March 31, 2024 for all applicable compliances as per the Regulation 24A of the Listing Regulations and Circulars/ Guidelines issued thereunder. The Annual Secretarial Compliance Report issued by M/s Balraj Sharma & Associates, Company Secretaries had submitted to the Stock Exchange/s as per the Listing regulations.

During the FY24, the Statutory Auditors, Internal Auditors and Secretarial Auditors have not reported any instance of fraud committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12) of the Act and the rules made thereunder.

Pursuant to Regulation 17(8) read with Schedule II Part B of the Listing Regulations, a certificate from the Chief Financial Officer ('CFO') and Managing Director of the Company have certified and confirming the correctness of the Financial Statements (Standalone and Consolidated) and Cash Flow Statements (Standalone and Consolidated), adequacy of the internal control measures for financial reporting for the year ended March 31, 2024. The certificate dated May 24, 2024 which is forms part of this report as "Annexure-3".

The Company has adopted a Code of Conduct for its employee including the Managing Director, Executive Directors, Non-Executive Directors and Independent Directors of the Company. Pursuant to the relevant listing regulations, the Company has received a compliance confirmation certificate from the Managing Director of the Company dated August 13, 2024 which is forms part of this report as "Annexure-4".

None of the Directors on the Board of the Company for the FY ended March 31, 2024, have been debarred or disqualified from being appointed or continuing as Director of the Company. The Company have received a Certificate from Practicing Company Secretary dated August 01,2024 which is forms part of this report as "Annexure-5".

During year under review, the Company has spent 2% of average net profits of your Company, during the three years immediately preceding financial year.

In accordance with Section 135 of the Act, as amended, read with Notification issued by the Ministry of Corporate Affairs ('MCA') dated January 22, 2022 and September 20, 2022 the applicable rules, the Company has updated Corporate Social Responsibility Policy, a brief outline of which, along with the required disclosures, is given in "Annexure-6" of this report in the format as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, which forms part of this Report.

The CSR Policy is available on the website of the Company i.e; https://udtltd.com/policies/.

In terms of Regulation 34 of the Listing Regulations, Management Discussion and Analysis Report for the financial year under review is presented in a separate section, forming an integral part of this Annual Report as "Annexure-7".

We, at UDTL, re-affirms its continued commitment, adhering good Corporate Governance practices. The Company is committed to maintain the highest standards of corporate governance and adherence to the corporate governance requirement set out by SEBI Listing Regulations.

Pursuant to Regulation 34(3) of the Listing Regulations, a report on Corporate Governance along with a Certificate from the Chartered Accountants in Practice towards compliance of the provisions of Corporate Governance, forms an integral part of this Annual Report and are given in "Annexure-8"and "Annexure-9"respectively.

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to the Report as "Annexure-10".

Statement containing particulars of top 10 employees and particulars of employees as required under Section 197 (12) of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as a separate Annexure forming part of this report.

The Company has always been conscious of the need to conserve energy in its manufacturing plants and to protect environment. Energy conservation is achieved through optimized consumption of power and fossil fuels and improvements in energy productivity, which contributes in reduction in operational costs and climate change mitigation through reduction in greenhouse gases.

The information pertaining to details of conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8 of the Companies Accounts Rules, 2014 are given in "Annexure-11".

Pursuant to Regulation 34(2)(f ) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective for the FY24 has been given in the Business Responsibility and Sustainability Report (BRSR) as per the format specified by SEBI Circular no. SEBI/ HO/CFD/CMD-2/P/CIR/2021 /562 dated May 10, 2021 which is forms part of this report as "Annexure-12".

The Board of Directors of the Company had laid down the criteria dealing with Related Party Transactions. During the year, the Company had not entered into any materially significant transaction as defined in the RPT Policy with related parties viz. promoters, directors, their relatives or the management, subsidiaries etc. that may have potential conflict with the interests of the Company at large.

All transactions entered by the Company during the FY24 with related parties were in the ordinary course of business and on an arm's length basis, which were recommended and approved by the Audit Committee.

During the year under review, The Company did not engage in any related party transactions that could potentially disadvantage minority shareholders.

The Audit Committee of the Company consists entirely of Independent Directors. Members of the Audit Committee abstained from participating in discussions and voting on transaction(s) in which they had an interest.

Form AOC-2 furnishing particulars of contracts or arrangements entered by the Company with related parties referred to in Section 188(1) of the Companies Act, 2013, is annexed to this report as "Annexure-13".

Pursuant to the provisions of Regulation 23 of the SEBI Listing Regulations, your Company has filed half yearly reports to the stock exchanges, for the related party transactions.

The details of all the Related Party Transactions form part of the standalone financial statements attached to this Annual Report. The Policy on the materiality of related party transactions and dealing with related party transactions as approved by the Board and is available on the website of the Company i.e; https://udtltd.com/policies/.

The Company's internal financial controls are commensurate to the scale and complexity of its operations.

The Company has adequate internal financial controls systems in place, which facilitates orderly and efficient conduct of its business including adherence to Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information.

Internal Control Over Financial Reporting (ICFR) remains an important component to foster confidence in a company's financial reporting, and ultimately, streamlining the process to adopt best practices. Your Company through Internal Audit Program is regularly conducting test of effectiveness of various controls. The ineffective and unsatisfactory controls are reviewed and remedial actions are taken immediately. The internal audit plan is also aligned to the business objectives of the Company which is reviewed and approved by the Audit Committee. Further the Audit Committee monitors the adequacy and effectiveness of your Company's internal control framework.

Esteemed Members / Shareholders may please refer 'Internal control systems and their adequacy' section in the Management's discussion and analysis report, which forms part of this Annual Report.

Pursuant to Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return for FY the 2023-24 is uploaded on the website of the Company and the same is available on the website of the Company i.e; https://udtltd.com/ annualreturn/.

The Company has formulated a comprehensive Whistle Blower Policy in line with the provisions of Section 177(9) and 177(10) of the Act and Regulation 22 of the Listing Regulations with a will to enable the stakeholders, including directors, individual employees to freely communicate their concerns about illegal, suspected Fraud or unethical practices and to report genuine concerns to the Audit Committee of the Company.

The mechanism provides adequate safeguards against victimization of directors or employees who avail of the mechanism. The Whistle Blower Policy is available on the website of the Company i.e; https://udtltd.com/policies/.

Due to the rise in cyber attack incidents, we regularly review our cyber security maturity and continuously enhance our processes and technological controls to align with evolving threat scenarios. Our company's technology infrastructure features real-time security monitoring with essential controls implemented across multiple layers, spanning from end-user devices to networks, applications, and data protection measures.

During the year under review, your Company did not face any incidents or breaches or loss of data breach in cyber security.

In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended (PIT Regulations), the Company has adopted the revised "Code of Conduct to Regulate, Monitor and Report Trading by Insiders' ("the Code"). The Code is applicable to all Directors, Designated persons and connected Persons and their immediate relatives, who have access to unpublished price sensitive information relating to the Company.

Pursuant to PIT Regulations and circulars issued by SEBI and Stock Exchange/s from time to time, the Company have installed the Structured Digital Database (SDD) Software and all UPSI duly captured, quarterly compliance certificate also filed to Stock Exchanges.

The Company has also formulated a 'Code of Practices and Procedures for Fair Disclosure'of Unpublished Price Sensitive Information (UPSI) in compliance with the PIT Regulations. The aforesaid Codes are available on the website of the Company i.e; https://udtltd.com/code-of-conduct/.

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security were proposed to be utilized by the recipients are provided in the standalone financial statements (Please refer to Notes to the standalone financial statements).

During the year under review, Your Company's board consisted of seven members, adhering to all relevant laws, rules, and regulations with a balanced composition of Executive and Non-executive Directors. The Board comprises four Independent Directors and three Executive Directors, with one of the Executive Directors also serving as the Chairman-cum-Managing Director. As of the date of this report, there have been no changes in the composition of the Board of Directors.

Your Company has received declarations from all the Independent Directors of your Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1) (b) of the SEBI Listing Regulations and there has been status as an Independent Director during the FY 2023-24. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

All Independent Directors of the Company have affirmed compliance with the Schedule IV of the Act and Company's Code of Conduct for Directors and Employees for the FY 2023-24.

In terms of the Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of the Company have enrolled themselves with the Indian Institute of Corporate Affairs ('IICA') on the Independent Directors Databank. Further, all the members of Board have declared their equity shares holding as well as interest in the Company as per requirement of Companies Act, 2013 and Listing Regulations.

The composition of the Board of Directors at the end of FY24 was as under:-

Furthermore, pursuant to Section 152 of the Companies Act and the Articles of Association of the Company, Mr. Inderpal Sharma (DIN - 07649251), Whole-time Director, is due to retire by rotation at the upcoming Annual General Meeting. Mr. Inderpal Sharma (DIN - 07649251) is eligible for re-appointment and has offered himself for re-election at the said Annual General Meeting. His reappointment is subject to the approval of the members and is detailed in the notice of the 42nd AGM. Relevant information concerning the Director's reappointment, as required under Para 1.2.5 of the Secretarial Standards on General Meetings and Regulation 36(3) of the Listing Regulations, has been provided in the AGM notice.

The Company has adopted a policy on familiarisation programme for Independent Directors with an objective of making the Independent Directors of the Company accustomed with the business and operations of the Company through various structured orientation programme.

The familiarization programme also intends to update the Directors on a regular basis on any significant changes therein so as to be in a position to take well informed and timely decision.

The details of the familiarization programme undertaken have been uploaded on the website of the Company i.e; https://udtltd.com/policies/.

As on the date of this report, in terms of the provisions of Section 203 & 2(51) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following are the Key Managerial Personnel of the Company as on the date of report:

The remuneration and other details of these KMPs for the FY24 are provided in the Corporate Governance Report which forms part of this report.

As on March 31,2024, in compliance with applicable laws, rules and regulations, as also for other purposes, your Board has constituted the following committees / subcommittees:-

• Audit Committee

• Nomination and Remuneration Committee (NRC)

• Stakeholders Relationship Committee

• Corporate Social Responsibility Committee (CSR)

• Risk Management Committee

The composition of the Committees was in conformity with the applicable provision of the Companies Act, 2013 and SEBI Listing Regulations.

For more details on composition and meeting of committee/s for the FY24 are provided in the Corporate Governance Report which forms part of this report.

During the year under review, your Board were met 5 (Five) times and the time gap between two board meetings did not exceed 120 days. These meetings of the Board of Directors were held on May 29, 2023, August 14, 2023, September 26, 2023, November 10, 2023 & February 09, 2024.

The composition of Board of Directors during the year ended March 31, 2024 is in conformity with Regulation 17 of the SEBI Listing Regulations read with Section 149 of the Companies Act, 2013. For more on attendance and other details for the FY24 are provided in the Corporate Governance Report which forms part of this report.

The provisions of Companies Act, 2013 and Listing regulations were adhered to timely while considering the time gap between two (02) meetings and various other requirements including Secretarial Standards as issued by The Institute of Company Secretaries of India (ICSI).

In accordance with Section 149(8) read with Schedule V and other relevant provisions of the Companies Act, 2013, as well as Regulation 25(3) of the Listing Regulations, a separate meeting of Independent Directors was convened on February 9, 2024. This meeting was attended by Mr. Krishan Diyal Aggarwal, Mrs. Preet Verma, Mr. Pandian Kalyanasundaram, and Mr. Ved Prakash, independent directors of the Company in the absence of NonIndependent Directors and members of the management inter alia to:-

• Review the performance of Non-Independent Directors, the Board as a whole and that of its various Committees constituted;

• Review the performance of the Chairperson of the Company, taking into account the views of Executive Director/s and Non-Executive Director/s; and

• Assess the quality, content and timeliness of flow of information between the Company Management and the Board which is necessary for the Board to effectively and reasonably perform its duties.

Pursuant to the provisions of the Act and Listing Regulations and as per Guidance Note on Board Evaluation issued by SEBI, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as evaluation of the working of its Committees at its meeting held on February 09, 2024 on the basis of a structured Questionnaire covering various aspects of the Board's functioning .

During the FY24, all Independent Directors have participated in the evaluation process and opined that the integrity, expertise, and experience (including proficiency) of the Independent Directors are satisfactory. The Nomination and Remuneration Committee has defined the evaluation criteria for the performance evaluation of individual Directors, the Board and its Committees.

The review concluded by affirming that the Board as a whole as well as its Chairman, all of its members, individually, and the Committees of the Board continued to display a commitment to good governance by ensuring a constant improvement of processes and procedures and contributed their best in the overall growth of the organization.

The Company has on the recommendation of the Nomination and Remuneration Committee framed and adopted a Nomination and Remuneration Policy in terms of the Section 178 of the Act. The policy, inter alia lays down the principles relating to appointment, cessation, remuneration and evaluation of directors, key managerial personnel and senior management personnel of the Company.

Non-executive, independent directors are paid, "Sitting Fee/s" within the limits prescribed under the Companies Act, 2013 at a fixed rate per meeting attended by them and as such the same cannot be compared with the remuneration to other employees. There-apart, no other remuneration or perquisite was paid to, and no service contract was entered into with them.

The Nomination & Remuneration Policy of the Company is available on the website of the Company i.e; https://udtltd. com/policies/.

The Board of Directors affirms that UDTL has complied in true letter & spirit with applicable Secretarial Standard/s issued by the Institute of Companies Secretaries of India (SS-1 and SS-2) relating to Board meetings, General Meetings and Committees thereof. Also, UDTL has complied with applicable Indian Accounting Standards while preparing these financial statements.

The Ministry of Corporate Affairs (MCA), Government of India has taken a 'Green Initiative in the Corporate Governance' vide its Circular Nos. 17/2011 dated 21.04.2011 and 18/2011 dated 29.04.2011 which enables the entity to effect electronic delivery of documents including the Notice of Annual General Meeting/Extra Ordinary General Meeting, audited financial statements, Director's Reports, etc. in electronic form, to the e-mail address of the Shareholders have registered with Depository Participant (DP).

Members may please note that AGM Notice and Annual Report 2023-24 are being send only in electronic mode and the said notice and annual report are also available on the Company's website www.udtltd.com, websites of the Stock Exchange/s i.e; BSE Limited and National Stock Exchange of India Limited at www.bseindia.com and www.nseindia.com respectively.

The Securities and Exchange Board of India (SEBI) has by its Circular No. SE BI/H O/MIRS D/MI RSD_RTAM B/P/ CIR/2021/655 dated November 03, 2021, Circular No. SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2021/687 dated December 14, 2021 and Circular No. SEBI/HO/MIRSD/ MIRSD-PoD-1/P/CIR/2023/37 dated March 16, 2023 made it mandatory for all holders of physical Securities to furnish the copy of PAN, Nomination in form SH-13, Cancellation or change in Nomination in form SH-14, Updation of contact detail in form ISR-1, & updation of Bank account details in form ISR-2. In this regard, you may contact with our Company's designated Registrar & Share Transfer Agent (RTA) and / or to our Company's official.

Risk management is a crucial aspect of corporate governance. The Board of Directors has formed a Risk Management Committee ('RMC') to support in overseeing and evaluating the company's risk management plan, implementing its risk management framework, and performing other functions as deemed appropriate by the Board.

The Risk Management framework ensures the identification, prioritization, mitigation, monitoring, and thorough reporting of significant threats to our organization's strategic objectives, reputation, operational continuity, environment, compliance, and the health and safety of our employees. A comprehensive section on Risk Management is detailed in the Management Discussion and Analysis Report, which forms an essential part of this Annual Report.

Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of the Listing Regulations, the Company has formulated and adopted a Risk Management Policy, same is available on the website of the Company i.e; https://udtltd.com/policies/.

The Company has actively pursued a risk mitigation policy by diversifying its products, services, markets, and customer base. Additionally, within the Industrial & Engineering segment, efforts are underway to reduce reliance on contract manufacturing. This includes boosting the Company's product portfolio and building brand equity.

Pursuant to Section 134(5) of the Act, your Board, to the best of their knowledge and based on the information and explanations received from the management of your Company, confirm that:

• In the preparation of the Annual Financial Statements for the year ended March 31, 2024, the applicable accounting standards have been followed and there are no material departures;

• such accounting policies applied consistently and judgments and estimates have been made 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 March 31,2024 and of the profit of UDTL for the year ended on that period;

• proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

• the annual financial Statement for FY 2023-24 were prepared on a Going Concern basis;

• they have laid down internal financial controls to be followed by your Company and that such internal financial controls are adequate and operating effectively;

• devised the proper system to ensure compliance with the provisions of all applicable laws and that such and were adequate and operating effectively.

The Company has in place a policy on prevention, prohibition and redressal of Sexual Harassment at workplace in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Committee has been setup to look after the complaints. All new employees undergo a comprehensive personal orientation session on the POSH (Prevention of Sexual Harassment) policy adopted by your company.

The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status.

All employees of the Company are covered under this policy.

The details of complaints received and disposed-off during the FY24 is as follows:

During the FY 2023-24, there were no transaction requiring disclosure or reporting in respect of matters relating to:

• No material changes and commitment, affecting the financial position of the Company which occurred between the end of FY24 till the date of this Report.

• No instance of any one-time settlement with any Banks or Financial Institutions.

• No application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016.

• No significant and material orders passed by the Regulators/ Courts/Tribunals which impact the going concern status and Company's operations in future.

• UDTL has not issued any Equity Shares including with Differential Voting Rights / Sweat Equity Shares.

• No occasion for revision in the Financial Statements for the year under report.

• No change in the nature of business of UDTL as on the date of this Report.

• No remuneration or commission to the Whole-time Director/ Managing Director of the Company from the subsidiaries of the Company.

• None of the Independent / Non- Executive Directors have any pecuniary relationship or transactions with the Company which in the judgement of the Board may affect the independence of the Directors.

• No transfer any amount to General Reserves of the Company, due to enhancing shareholders value.

UDTL is involved in the manufacturing of oil drilling tools and equipments. Since these tools and equipments are predominantly used in the oil and gas industry, we are focusing on the growth and prospects of them only. Directors' Report, Business Responsibility and Sustainability Report, Management Discussion & Analysis Report, Financial Statements (Standalone & Consolidated); annexure(s), attachment(s) thereto information pertaining to the projections, estimates, etc. are forward looking under SEBI applicable rules and regulations, whereas, the actual results might differ.

Important factors that could make difference to UDTL's operations includes, Global and India's Demand, Supply conditions, finished goods prices, Raw Material availability and Prices, cyclical Demand and pricing in the Company's principal markets, changes in Government regulations, tax regimes, economic developments within India and the Countries with whom UDTL conducts business and other factors such as litigation and labour negotiations.

The Company is not obliged to publicly amend, modify/ revise forward looking statement(s), on the basis of any subsequent development, information or events or otherwise.

The Directors extend their gratitude to shareholders, bankers, and financial institutions for their cooperation and support, and seek their ongoing support. They also thank customers, vendor partners, and other business associates for their continued collaboration throughout the year. The Directors acknowledge and appreciate the dedication and efforts of all Company's employee.