Prajay Engineers Syndicate Ltd

To

The Members

Prajay Engineers Syndicate Limited ("the Company" or "PESL")

Your Directors are pleased to submit the 30^th Board Report of your Company together with the Audited Financial Statements (both Standalone and Consolidated) for the Financial Year (FY) ended 31^st March, 2024 and report of the Statutory Auditors thereon. Consolidated performance of the Company and its subsidiaries has been referred to wherever required.

FINANCIAL RESULTS:

Certain key aspects of your Company's performance (on Standalone & Consolidated basis) during the financial year ended 31^st March, 2024, as compared to the previous financial year are summarized below:

(Amount in Rs. Lakhs except share data)

NATURE OF BUSINESS

The Company is engaged in the activities of Real Estate Development, Construction activities and Hospitality. During the financial year under review, there was no change in the nature of the business of the company.

REVIEW OF OPERATIONS

During the current Financial Year 2023-24, your company reported a Consolidated Income of Rs.4872.27 Lakhs against Rs.6093.76 for the previous Financial Year. The Loss for the current Financial Year 2023-24 stood at Rs.3982.20 Lakhs as against Rs.941.96 Lakhs for the previous Financial Year.

The Standalone Income of your company for the current Financial Year 2023-24 stood at Rs.2833.19Lakhs as against Rs.4872.27Lakhs for the previous Financial Year. The Total loss for the Financial Year 2023-24 was Rs.3149.07 Lakhs as against an amount of Rs.756.63 during the previous Financial Year.

TRANSFER TO GENERAL RESERVES

No amount has been transferred to General Reserves during the financial year under review.

DIVIDEND

Your Board of Directors do not recommend any dividend, in view of losses incurred during the financial year under review.

SUBSIDIARIES

As on 31^st March, 2024 the Company has 3 (Three) subsidiaries viz., Prajay Holdings Private Limited (PHPL), Prajay Retail Properties Private Limited (PRPPL) and Secunderabad Golf and Leisure Resorts Private Limited (SGLRPL) and one step down subsidiary viz., Prajay Developers Private Limited (PDPL). Your company also has two Associates viz., Prajay Properties Private Limited (PPPL) and Genesis Capital Private Limited as on 31^st March, 2024. PRPPL and SGLrPl are the wholly owned (100%) subsidiaries of the Company.

There has been no material change in the nature of the business of the subsidiaries. The consolidated financial statements of the Company and its subsidiaries, prepared in accordance with applicable Indian Accounting Standards (IND AS), as specified under Section 133 of the Companies Act, 2013 (The Act) read with Rules made thereunder, forms part of this Annual Report.

REPORT ON PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES, ASSOCIATES AND JOINT VETURE COMPANIES

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 a statement containing salient features of the financial statements of the Company's subsidiaries in Form AOC-1 is attached to the standalone financial statements of the Company as Annexure 1.

SHARE CAPITAL

There is no change in the capital structure of the company during the year under review.

DISCLOSURE UNDER COMPANIES (SHARE CAPITAL AND DEBENTURE) RULES, 2014.

During the year under review, your company has not issued any equity shares with differential rights/sweat equity shares. Further the company has not grant/vest any employee stock option scheme/employee stock purchase schemes. Further at the beginning of the year there were no outstanding options granted. Hence, there is no requirement of disclosures under Companies (Share Capital and Debenture) Rules, 2014.

DISCLOSURES IN RESPECT OF VOTING RIGHTS NOT DIRECTLY EXERCISED BY EMPLOYEES

There are no shares held by trustees for the benefit of employees and hence no disclosure under Rule 16(4) of the Companies (Share Capital and Debentures), 2014 is required to be furnished.

DIRECTORS & KEY MANAGERIAL PERSONNEL

During the year under review there were no changes in office of Directors and Key Managerial Personnel of the company:

In accordance with Section 152 of the Companies Act, 2013, Mr. Ravi Kumar Kutikalapudi, (DIN:02789546), Director of the Company, retires by rotation in this ensuing AGM to be held on Wednesday, the 27^th day of September, 2024, and being eligible has offered himself for re-appointment. The Board recommends his reappointment.

Pursuant to the provisions of Section 149 read with Schedule IV to the Companies Act, 2013, an Independent Director may be reappointed for another term of 5 years, if approved by members by way of Special Resolution. Mr. Jaya Simha Reddy Lingam (DIN: 08328343), upon completion of his term of appointment as Independent Director of the Company, is proposed to be appointed as an Independent Director for a Second Term, at the ensuing AGM.

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of Section 134(5) of the Companies Act, 2013 and in relation to the audited financial statements of the Company for the year ended 31^st March 2024, the Board of Director hereby confirms that:

a. In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b. Such accounting policies as mentioned in the notes to the financial statements have been selected and applied consistently and judgments and estimates that are reasonable and prudent made so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2022-23 and of the profit or loss of the Company for that period;

c. 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;

d. The annual accounts for the year 2022-23 have been prepared on a going concern basis.

e. Those proper internal financial controls were in place and that the financial controls are adequate and are operating effectively.

f. Proper Systems have been devised to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively

ANNUAL EVALUATION OF DIRECTORS, COMMITEES AND BOARD

The Nomination and Remuneration Committee of the Board has formulated a Performance Evaluation Framework, under which the Board of Directors has carried out an annual evaluation of its own performance, performance of all the Board Committees and Individual Directors pursuant to the provisions of the Companies Act, 2013 and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015 ( hereinafter referred as "SEBI (LODR) Regulations").

The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

BOARD DIVERSITY

The Policy on Board Diversity of the Company devised by the Nomination and Remuneration Committee and approved by the Board is disseminated under the weblink of the Company at www.praiavengineers.com/investors

CODE OF CONDUCT AND DECLARATION ON CODE OF CONDUCT

Your Company has laid down a Code of Conduct for all Board members, Senior Management and Independent Directors of the company in line with the provisions of SEBI (LODR) Regulations and Companies Act, 2013. The said Code of Conduct has been posted on the website of the Company weblink www.praiayengineers.com/investors. Declaration of Code of Conduct is enclosed to this Board Report as an Annexure to Corporate Governance Report.

AUDIT COMMITTEE

An Audit committee has been constituted in terms of Section 177 of Companies Act, 2013 and in terms of Regulation 18 of SEBI (LODR) Regulations. The composition and brief terms of the committee and its meetings etc. has been provided under Corporate Governance report which forms part of this Board report. All the recommendations made by the Audit Committee were accepted by the Board.

ESTABLISHMENT OF VIGIL MECHANISM:

The Company has adopted a whistle blower policy establishing a vigil mechanism to provide a formal mechanism to the directors and employees to report concern about unethical behavior, actual or suspected fraud or violation of code of conduct and ethics.

It also provides for adequate safeguards against the victimization of employees who avail of the mechanism and provides direct access to the chairperson of the audit committee in exceptional cases. The whistle blower policy aims for conducting the affairs in a fair and transparent manner by adopting higher standards of professionalism, honesty, integrity and ethical behavior. All permanent employees of the company are covered under the whistle blower policy.

It is affirmed that no personnel of the company has been denied access to the audit committee. The policy of vigil mechanism is available on the company's weblink www.praiayengineers.com/investors.

NOMINATION & REMUNERATION COMMITTEE:

A Nomination has been in constituted in terms of Section 178 of Companies Act, 2013 and in terms of Regulation 19 of SEBI (LODR) Regulations. The composition and brief terms of the committee and its meetings etc. has been provided under Corporate Governance report which forms part of this Board Report. All the recommendations made by the Audit Committee were accepted by the Board.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The company has constituted a Corporate Social Responsibility Committee and details of the Committee have been provided under Corporate Governance Report, which forms part of this Board Report.

OTHER BOARD COMMITTEE(S)

For the details of other Board Committee(s), please refer the Corporate Governance report which is annexed to this Board Report.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Salient Features of the Company's policy on directors' appointment and remuneration and other matters including performance evaluation are provided in the Corporate Governance Report which forms part of this Board report. Nomination and Remuneration Policy available under weblink www.praiayengineers.com/investors

MEETINGS OF THE BOARD OF DIRECTORS DURING THE FINANCIAL YEAR

Five (5) meetings of the Board of directors were held during the year. For details of the meetings of the Board, please refer to the corporate governance report, which forms part of Board Report.

MEETING OF INDEPENDENT DIRECTORS:

During the financial year under review, in accordance with the provision of Schedule IV of the Companies Act, 2013 and SEBI (LODR) Regulations, separate meeting of Independent Directors of the Company held on 12^th February, 2024 and the same has reported in the Corporate Governance Report.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:

All Independent Directors (IDs) inducted into the Board are provided with an orientation on company structure and Board constitution and procedures, matters reserved for the Board, and our major risks and risk management strategy. The company familiarize the independent directors with the company, their roles, rights, responsibilities in the company, nature of the industry in which the company operates, etc., through various Interactions and familiarization programmers. Details of the familiarization program of the independent directors are available on the website of the Company www.praiavengineers.com/investors.

PERFORMANCE EVALUATION CRITERIA FOR INDEPENDENT DIRECTORS

The performance evaluation criteria for Independent Directors is determined by the Nomination and Remuneration committee. An indicative list of factors that may be evaluated include participation and contribution by a director, commitment, effective deployment of knowledge and expertise, effective management of relationship with stakeholders, integrity and maintenance of confidentiality and independence of behavior and judgments etc. Based on said criteria the entire Board will evaluate the performance of Independent Directors.

DECLARATIONS BY INDEPENDENT DIRECTORS

All Independent Directors have submitted declarations stating that they fulfill the criteria of independence as laid down under Section 149(6) of the Act and Securities and Exchange Board of India. In the opinion of the Board, the independent directors fulfill the conditions specified in SEBI (LODR) Regulations and are independent of the management.

STATUTORY AUDITORS AND THEIR REPORTS

As per the provisions of Companies Act, 2013 read with rules made thereunder, M/s. Karumanchi & Associates, Chartered Accounts, Hyderabad, Statutory Auditors of the Company were reappointed as Statutory Auditors of the Company for second term of five (5) consecutive years to hold office from the conclusion of 27^th Annual General Meeting till the conclusion of the 32^nd Annual General Meeting of the company.

Observation of Statutory Auditors on Financial Statements for the year ended March 31, 2024

The audit report does not contain any qualification, reservation or adverse remark or disclaimer or modified opinion. The Key emphasis matters are self-explanatory. For clarifications on key emphasis matters relating to the delay in realization of trade receivables and realization of loans and advances given, please refer Note 39(a) and 39(b) of Notes to Standalone Financial Statements. For clarifications on Demand Notice received by the Company, please refer Note 41 and for clarification in respect of Cost of Construction please refer Note 45 of Notes to Standalone Financial Statements.

FRAUD REPORTING

During the year under review, no instances of fraud were reported by the Statutory Auditors of the Company.

INTERNAL AUDITOR:

The Company has appointed Mr. M. Shanker, MBA-Finance, Employee of the Company as Internal Auditor of the Company.

COST AUDIT/MAINTENANCE OF COST RECORDS

For the Financial Year ended 2023-24, your company is required to maintain Cost Records as specified by the Central Government under Sub-section (1) of Section 148 of the Companies Act, 2013, in respect of the activities carried on by the Company. However, Cost Audit as specified under Rule 4 of the Companies (Cost Records and Audit) Rules, 2014 is not applicable to your Company.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has adequate internal control systems and procedures designed to effectively control its operations. The Internal Control Systems are designed to ensure that the financial and other records are reliable for the preparation of financial statements and for maintaining assets. The Company has well designed Standard Operating Procedures considering the essential components of internal control as stated in the Guidance Note on Audit of Internal Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. Internal Auditor conducts audit covering a wide range of operational matters and ensure compliance with specified standards. Planned periodic reviews are carried out by Internal Auditor. The findings of Internal Audit are reviewed by the top management and by the Audit Committee of the Board of Directors. Based on the deliberations with Statutory Auditors to ascertain their views on the financial statements including the Financial Reporting System and Compliance to Accounting Policies and Procedures. The Audit Committee was satisfied with the adequacy and effectiveness of the Internal Controls and Systems followed by the Company.

SECRETARIAL AUDITOR:

Pursuant to the provisions of Section 204(1) of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 your Company has appointed Mr. M. Ramana Reddy, P S Rao & Associates Practicing Company Secretaries, Hyderabad as Secretarial Auditor, to undertake the Secretarial Audit of the Company for the Financial Year 2023-24.

The Secretarial Audit Report as required under provisions of the Companies Act as stated above and also as required under Regulation 24 A of the SEBI (LODR) Regulations is annexed herewith to this Report.

REPLIES TO REMARKS OF SECRETARIAL AUDITOR OF PESL

The remarks/comments raised/provided by the Secretarial Auditor are self-explanatory.

IEPF

During the month of July, 2019 pursuant to the directions of the IEPF authority the company has transferred the 34103 (Thirty-Four Thousand One Hundred and Three) equity shares in respect of which the dividend has not been claimed for seven consecutive years. The members can claim the transfer of such shares from IEPF in accordance with the procedure and on submission of the documents as prescribed from time to time. Additionally, the details have also been uploaded on the website of the Company.

POLICY ON PREVENTION, PROHIBITION AND REDRESAL OF SEXUAL HARASSMENT AT WORK PLACE

Your Company has in place the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressed) Act, 2013.

Internal Complaints Committee:

Internal Complaints Committee (ICC) has been set up under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressed) Act, 2013.

To redress complaints received regarding sexual harassment. Your company has complied with the provisions relating to the constitution of ICC. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the financial year under review, the Company has not received any complaint on sexual harassment. In compliance with the directions of the Telangana State Government, your Company has registered the ICC on prescribed T-She Portal.

POLICY ON MATERIAL SUBSIDIARIES

Policy for determining material subsidiaries of the Company is available on the website of the Company www.praiavengineers.com/investors

MANAGEMENT DISCUSSION & ANALYSIS REPORT

The Management Discussion and Analysis Report as required under Regulation 34 & Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and enclosed as Annexure- 4 to this Directors (Board) Report.

CORPORATE GOVERNANCE

Report on Corporate Governance enclosed as Annexure- 5 to this Board report. A certificate from P S Rao & Associates the Practicing Company Secretaries regarding compliance with the corporate governance norms stipulated also annexed to the corporate governance report.

EXTRACT OF ANNUAL RETURN:

In accordance with Section 134 (3) (a) of the Companies Act, 2013, a copy of Annual Return in the prescribed format i.e. Form MGT -7 is placed on the website of the Company and may be accessed at www.praiayengineers.com/investors

PUBLIC DEPOSITS:

During the Financial Year 2023-24, your Company has not accepted any deposit that falls within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014. Further there are no amount outstanding as at the beginning of Financial Year 2022-23 which can be classified as 'Deposits' in terms of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposit) Rules, 2014 and hence, the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Companies Act, 2013 is not applicable.

PARTICULARS OF LOANS, GUARANTEES, SECURITIES OR INVESTMENTS UNDER SECTION 186.

The details of loans given, investments made, guarantees given and securities provided during the year under Section186 of the Act are available under Note 8 & 9 of the notes to the standalone financial statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 and Pursuant to SEBI (LODR) Regulations are given in Form AOC-2 and forms part of this Board Report as Annexure - 2 and under Note 28 to Standalone Financials.

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

There are no significant material orders passed by the regulators/courts/tribunals which would impact the going concern status of your Company and its future operations.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There are no material changes and commitments in the business operations of the company for the financial year ended 31^st March, 2024 and to the date of signing of the Director's Report.

CHANGE IN THE NATURE OF BUSINESS

There is no change in the nature of business of the Company

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

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is annexed as Annexure- 3 to this Directors (Board) Report.

RISK MANAGEMENT:

The Company's principal financial liabilities comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance and support Company's operations. The Company's principal financial assets include inventory, trade and other receivables, cash and cash equivalents and land advances and refundable deposits that derive directly from its operations.

The Company is mainly exposed to market risk, credit risk and liquidity risk. The company has a risk management policy and framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives, and enhance the Company's competitive advantage. This framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

INDUSTRIAL RELATIONS:

Yours directors are happy to report that the industrial relations have been cordial at all levels throughout the year. Your directors record their appreciation for all the efforts, support and co-operation of all employees being extended from time to time.

LISTING AT STOCK EXCHANGES:

The equity shares of your Company are listed on NSE and BSE (the stock exchanges). The listing fee has been paid for the year 2023-24.

CEO AND CFO CERTIFICATION AS PER REGULATION 17(8) OF SEBI (LODR) REGULATIONS:

As required by Regulation 17(8) of SEBI (LODR) Regulations, certification on the Financial Statements and the Internal Control Systems for financial reporting has been obtained from Mr. Dantapalli Vijaysen Reddy Chairman and Managing Director and Mr. Bhaskara Rao Patnana - Chief Financial Officer of the company and the same was reviewed by the Board of Directors and is annexed to the Corporate Governance Report.

HUMAN RESOURCES:

Your Company recognizes that "Human Resource" is its main asset. Your Company HR policy aims at enhancing individual capabilities for future readiness, driving greater employee engagement and strengthening employee relations further.

Considering the present market conditions, your Company has down sized its human resources and retaining only that are directly relevant to its growth at this stage. To attract and retain people, your Company provides a judicious combination of attractive career, personal growth and a lucrative compensation structure. Your Company places great importance on nurturing and retaining the best skills in the industry.

INFORMATION TO BE FURNISHED UNDER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

Not applicable as no employee of the Company is in receipt of such remunerations specified under above stated rule. However, the other information as required to be furnished under Rule 5(1) and 5(2) of above stated rules is provided under Annexure- 4

Other Disclosures

During the financial year under review, your Company has not revised financial statement(s).

No valuation of the Company has been done during the year under review, either for the purpose of One Time Settlement (OTS) or for the purpose of taking loan from bank/FIs.

ACKNOWLEDGEMENTS:

Your Directors thank the various Departments of Central/ State Government, SEBI, Stock Exchanges, RBI, MCA and other Regulatory Bodies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz., Shareholders, Customers, Bankers, Suppliers, Joint Venture Partners and other business associates for the excellent support received from them. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution and confidence reposed in the management.