Your Directors presents the 55^th Annual Report together with the audited financial statements of the company for the year ended

31 March 2025.

1. HIGHLIGHTS ON OPERATIONS:

i) Your company achieved production of 7 3767 crore as against 7 2592 crore of previous financial year and achieved sales
turnover of 7 3345 crore as against 7 2369 crore of previous financial year, registering a growth of 41%.

ii) Highest ever export of 7 1270 crore during FY 2024-25 as against the previous year’s export turnover of 7161 crore
registering a growth of about 689%.

iii) During the year, your company has received new orders worth about 76668 crore for supply of one of the Anti-Tank Guided
Missiles (ATGM), Medium Range Surface to Air Missile (MR-SAM) and other weapon systems to the Indian Armed Forces.

iv) During the year, your company has successfully evaluated trails of new generation ATGMs, upgraded Surface to Air Missiles,
Vertical Launched Short Range Surface to Air Missiles (VL-SRSAM), Long Range Land Attack Cruise Missiles (LR-LACM) and
Underwater Weapons.

2. FINANCIAL RESULTS AND PERFORMANCE HIGHLIGHTS:

2.1 Performance of the company in financial terms is summarized below:

# EPS has been calculated based on profits excluding the other comprehensive income and number of shares outstanding
at the end of the year is adjusted for the impact of sub division of 1 fully paid up equity share having a face value of 710
each into 2 fully paid up equity shares having a face value of 75 each.

2.2 Following data reflect the financial position of the company:

2.3 During the year under review, your company has achieved revenue from operations of 1 3345 crore, compared to 12369
crore in the previous financial year, registering a growth of 41%. The growth in turnover is primarily driven by boosted
manufacturing activities and easing out of supply chain constraints.

During FY 2024-25, the company reported a profit before tax of 1749 crore, compared to 1828 crore in FY 2023-24. The
decline is primarily attributed to the absence of a one-time net gain of 1119 crore (after offsetting 146 crore in associated
expenses) that was recorded in the previous financial year. Additionally, the current year’s results were impacted by a
1141 crore provision for a contract identified as onerous and a 190 crore provision for expected credit losses on trade
receivables.

The major products executed during the year are ATGMs, Akash-SAMs. The order book position of the company as on
31 March 2025 is about 1 22814 crore.

2.4 Future Outlook:

In the fiscal year 2024-25, your company recorded a turnover surpassing 13345 crore, a 41% rise from the previous year,
with exports soaring 689% to 11270 crore. The company secured orders worth 16668 crore building an order book of
122814 crore as on 31 March 2025. Your company anticipates further new orders worth 120000 crore over the next 2-3
years as several orders are in the finalization stages, ensuring robust future growth.

Your company is committed to advancing India’s self-reliance in next-generation weapon systems by adopting a
comprehensive and strategic approach. We prioritize the indigenous development of critical defence technologies, including
missile seekers, homing systems, avionics, cruise missile propulsion, specialized warheads, and electronic warfare systems.

To drive innovation and foster cutting-edge research, we actively collaborate with premier Indian institutions such as IITs,
NITs, and domain-specific research centers. These partnerships enable the co-creation of disruptive technologies tailored
to India’s strategic needs.

In parallel, we pursue joint ventures with leading global defence firms, bringing world-class expertise and manufacturing
practices to India. These collaborations support both domestic requirements and export-oriented production, strengthening
India’s position in the global defence market.

We strategically engage in foreign technology transfer programs, not only to bridge existing capability gaps but also to fast-
track the Make-in-India initiative. From the contractual stage, we emphasize maximizing indigenous content, ensuring that
each project contributes to the long-term vision of technological sovereignty.

Through this integrated approach-combining indigenous innovation, global collaboration, and strategic capability-building—
your company is shaping the future of India’s defence ecosystem, making it robust, competitive, and self-reliant.

The Government of India has approved several BDL products for export, BDL has begun penetrating the global defence
market, offering customized solutions and comprehensive lifecycle management for its products. By partnering with local
defence industries in customer countries, BDL ensures robust, localized lifecycle support. To boost efficiency, BDL is
optimizing its production lines by streamlining processes and adopting advanced technologies, ensuring timely deliveries
while maintaining high-quality standards.

In FY 2025-26, we will continue to focus on organizational capacity building, talent development, and fostering a high-
performance culture across the company. With a skilled workforce, solid institutional foundation, and a clear strategic
direction, BDL is confident in its ability to deliver value to stakeholders, contribute meaningfully to national defence
preparedness, and emerge as a global player in the defence manufacturing sector.

3. FIXED DEPOSITS FROM PUBLIC:

Your company did not accept any fixed deposits from public during the year, and there was no outstanding Fixed Deposits at the
beginning/end of the year. Accordingly, there was no default in payment of deposits/interest thereon.

4. DIVIDEND & TRANSFER TO GENERAL RESERVE:

Your company has a consistent track record of Dividend Payment. The Board has recommended a Final Dividend of 1 0.65/- per
equity share of face value of 15/-each amounting to 1 23.83 crore for the year 2024-25. Further, your company has paid interim
dividend of 14 per share (at face value of 15/- each) amounting to 1146.63 crore for the year 2024-25. The total dividend for FY
2024-25 declared by the company is 14.65 per share (at face value of 15 each). An amount of 1 400 crore is being transferred
to General Reserve for the year 2024-25.

BDL paid Interim dividend of F109,86,04,216 for the Financial Year 2024-25 to Government of India. CMD of BDL, Cmde A Madhavarao
(Retd) presented the Dividend Cheque, pertaining to the Govt. of India's shareholding in BDL to Hon'ble Raksha Mantri Shri Rajnath Singh.
The total dividend paid by BDL to Govt. of India for the year amounts to k 1,27,71,27,401.

5. CAPITAL STRUCTURE:

The paid up capital of the company as on 31 March, 2025 stood at T183.28 crore (36,65,62,500 equity shares of T5/- each).
The Authorized Capital of the company is T200 crore (40,00,00,000 equity shares of T5/- each) as on 31 March 2025.

As on 31 March 2025, the Govt. of India shareholding in the company stands at 74.93% (representing 27,46,51,054 equity
shares of T5/- each).

6. SUBSIDARIES/JOINT VENTURES/ASSOCIATE COMPANIES:

As on 31 March 2025, your company has two section 8 Joint Venture companies viz., M/s Electronic Warfare (Defence) Testing
Foundation and Advanced Materials (Defence) Testing Foundation formed under Defence Testing Infrastructure Scheme
(DTIS) promulgated by Department of Defence Production, Ministry of Defence. Your company holds 10% shareholding in M/s
Electronic Warfare (Defence) Testing Foundation and 20% shareholding in Advanced Materials (Defence) Testing Foundation.
These entities are not considered for preparation of consolidated financial statements as the company does not have right to
variable returns from its involvement, other than equity investment.

7. PERFORMANCE AGAINST MoU:

Your company signs a Memorandum of Understanding (MoU) every year with the Ministry of Defence, Government of India. The
performance of the company for the year 2023-24 was rated as “Very Good” and the performance for the year 2024-25 is under
evaluation.

8. MODERNIZATION & UPGRADATION:

During the year, an amount of T282.75 crore has been spent towards Capital Expenditure (CAPEX) programs for the modernization
of Plant & Machinery and other infrastructure development, including joint development programs. The majority of this amount
was dedicated to establishing the infrastructure work for establishment of propellant plant at Jhansi, infrastructure work for
Phase-II at Ibrahimpatnam. Additionally, your company has planned to spend approximately T200 crore during the current
financial year 2025-26 on various CAPEX programmes, including construction of Jhansi Unit, Phase-II infrastructure development
at Ibrahimpatnam and Ceramic Radome facility at Kanchanbagh.

Your company is making determined efforts to increase the indigenization content in the manufacturing of ATGMs, SAMs, Air to
Air Missiles, and Torpedoes. This objective aims to enhance self-reliance and reduce dependence on imports

9. RESEARCH & DEVELOPMENT:

Your company acknowledges that Research and Development (R&D) plays a pivotal role in the growth of the organization. To
cater to the requirements of the Indian Armed Forces, your company has identified several products for R&D.

The following table shows the recent trend of in-house R&D expenditure:

10. PROCUREMENT FROM MSMEs:

In compliance with the Procurement Policy of the Government of India, your company has surpassed the mandated procurement
requirement of 25% from Micro, Small, and Medium Enterprises (MSMEs). During the year 2024-25, your company procured
29.12% of goods and services, amounting to approximately 7460.48 crore, from MSMEs out of its total procurement of 71581.42
crore. By achieving the mandated target of 25% from MSMEs, your company has demonstrated its commitment to supporting
and promoting the growth of these enterprises.

Industry Partners Development:

Your company endeavors to expand its vendor base through special drives and by offering free registration in certain cases and
on specific occasions. Throughout the year, your company conducted 6 vendor meets, resulting in over 500 registered vendors
as of the current date. Furthermore, your company has implemented an updated Integrity Pact in accordance with the directives
of the Central Vigilance Commission’s latest circular and adheres to the Standard Operating Procedure outlined therein. Your
company has procured goods & services to the tune of 3.83% (of total procurement) from Women MSM enterprises, thus
surpassing the 3% target set for such procurement. The procurement from SC/ST owned MSMEs stood at 1.19% (of total
procurement) against the mandated procurement of 4%, about 1174 MSMEs (including SC/ST & women) have been benefitted
in FY 2024-25.

Government e Market Place (GeM):

Your company registered as both a Buyer and Seller with the Government e-Marketplace (GeM). GeM is utilized for procuring
common items and services. Throughout the year, your company has successfully procured common goods and services worth
71501 crore through GeM out of total procurement of 71581.42 crore (Gross Merchandise Value) with staggered deliveries. This
demonstrates your company’s active engagement and utilization of GeM for streamlined procurement processes.

11 EXHIBITIONS:

During the year, your company has showcased its products in various National and International Exhibitions where in the Senior
Executives and Directors of the company took it on themselves to explain to the various stake holders on the developments in
the company and enabled greater collaboration with all stakeholders. The details along with the photographs of such exhibitions
are as follows:

12. EXPORTS:

Your company has placed significant emphasis on the export of Weapon Systems. During the year, your company has registered
highest exports value of about 71270 crore, which is all time high in the history of the company. The products offered by
your company are state-of-the-art, designed indigenously, competitively priced, and not heavily reliant on any foreign Original
Equipment Manufacturers (OEMs). With existing facilities, your company is well prepared to meet both domestic and export
demands. Several leads have been received from various friendly foreign countries for the export of BDL products, these leads
are actively being pursued by the export cell, which is engaged in interactions with overseas customers to achieve export targets.
As a result, your company has secured orders for the export of various Weapon systems, CMDS, ATGMs, SAMs etc. from friendly
foreign countries. Channel Partners/Agents have been appointed in several countries to promote your company’s exportable
products. Your company has also participated in various Foreign Defence Exhibitions to showcase its products and facilitate one-
on-one meetings with participants from the Armed Forces/Ministries of Defence of other countries. To strengthen international
engagement, BDL is working closely with Indian Embassies / Defence Attaches to arrange meetings and visits with stakeholders
from foreign countries. Furthermore, plans are underway to open Representative Offices in foreign countries. As of 31 March,
2025, your company has total export order book of 71167 crore, reflecting the growing success in the international market.

13. ATMANIRBHAR BHARAT & INDEGINISATION:

As part of its commitment to building an Atmanirbhar Bharat (Self-Reliant India), BDL has prioritized indigenization efforts from
the very outset of each contract. The company manufactures missiles through Technology Transfer (ToT) agreements with both
the Defence Research and Development Organisation (DRDO) and foreign Original Equipment Manufacturers (OEMs).

While initial ToT from foreign OEMs covered only around 60% of the technology, BDL has successfully increased indigenization
levels to over 80%-90% in many of these products. For DRDO-designed systems, most of them have already achieved
indigenization levels exceeding 90%. BDL continues to make concerted efforts to further enhance indigenization across its entire
product range, reinforcing its role in strengthening India’s defence manufacturing capabilities.

BDL is utilizing the Srijan Portal, an indigenization initiative by the Ministry of Defence. The primary objective of the Srijan Portal
is to engage the private sector in the indigenization efforts of Defence PSUs. BDL regularly uploads details of imported items
identified for indigenization, enabling Indian industry partners to come forward and participate in their development.

Accordingly, BDL has uploaded 1,198 imported items on the portal. As of this year, 217 items have been indigenized cumulatively.
Necessary technical support is being provided to Micro, Small, and Medium Enterprises (MSMEs) to encourage them to produce
quality components.

BDL is also fostering collaboration with startup companies, identifying problem statements for them to work on and develop
innovative solutions. Memorandums of Understanding (MoUs) are being signed with these companies to support their growth
and create new business opportunities.

Furthermore, as of this year, the Ministry of Defence has issued five Positive Indigenisation Lists (PILs) under the Department of
Defence Production (DDP) as part of ongoing efforts to promote self-reliance in defence manufacturing through the Atmanirbhar
Bharat Abhiyan. These lists include an embargo on imports beyond specified timelines.

Of the five PILs issued, 59 items are associated with BDL. Out of these, BDL has successfully indigenized 49 items, while the
remaining items are at various stages of the indigenization process.

In line with the Government of India’s vision for the Make in India initiative, with a special focus on Atmanirbharta in Defence,
BDL has conducted and participated in several vendor development programs and seminars, showcasing components and sub¬
assemblies proposed for indigenization.

During these events, vendors were briefed on the indigenization procedures, as well as the technical and procedural support that
BDL would provide throughout the indigenization process.

BDL and the Innovation for Defence Excellence (iDEX) programme have forged a strategic partnership, in alignment with the
Government’s vision of Atmanirbhar Bharat. This collaboration has led to the creation of a robust ecosystem where BDL works
closely with aspiring entrepreneurs and MSMEs to enhance its innovation and R&D capabilities.

Through iDEX, BDL has been engaging with startups to develop innovative technologies for its R&D projects and for the
production of missile systems for the Indian Armed Forces. As a result of this partnership, a Miniaturized Visual Imaging Guidance
System was successfully developed during 2024-25.

14. MANPOWER AND RESERVATION OF POSTS FOR SCs/STs:

14.1 The company has been following Presidential Directives of the Government with regard to reservation of posts for SCs/
STs/OBC in recruitments.

14.2 Total manpower strength as on 31 March 2025 is at 2269 (including four functional directors). Out of the total strength,
72 are ex-servicemen, 465 are of Schedule Caste, 200 are of Scheduled Tribes, 792 are of OBC category and 10 are of
EWS category. The percentage of Scheduled Caste and Scheduled Tribes in respect of employees is at 20.49% and 8.81%
respectively.

14.3 The No. of Scheduled Caste, Scheduled Tribes, OBC and EWS in various categories of posts as on 31 March 2025 is given
below:

14.4 Recruitment of employees in Scheduled Caste, Scheduled Tribes, OBC, EWS during 2024-25 is given below:

14.5 Employment of Women:

As per the recommendation No.51, Para (ii)(a) of the National Commission for Women (NCW) in its Annual Report for the
year 1995-96, the employment position of Women as on 31 March 2025 is given below as directed by the Ministry of
Defence, vide their letter Nos. 39(6)/99/D(B&C), dated 27 August 1999.

14.5.1 Executives

14.5.2 Non-executives

14.6 Persons with Disabilities (PWD) as On 31 March 2025:

The total number of Physically Challenged employees as on 31 March 2025 is 93 and its percentage to total employees
works out to 4.10%.

HI- Hearing Impaired, LD-Locomotive Disability, VI-Visually Impaired, MD-Multi Disability

15. HUMAN RESOURCE DEVELOPMENT:

During FY 2024-25, your company has demonstrated a strong commitment to employee development by conducting various
training programs for both Executives and Non-Executives. A total of approximately 1415 employees participated, resulting in
3099 training man-days. These programs, conducted through both in-house and external agencies, were designed to enhance
skills and knowledge while also meeting statutory requirements.

These initiatives aimed to enhance executives’ understanding of internal systems and procedures, get acquainted with latest
technologies, improve interpersonal communication and presentation skills, and ultimately enable them to perform their roles
more effectively, contributing to the company’s success.

15.1 Key Training Programs and Initiatives:

15.1.1 Vigilance Awareness Week Trainings:

i) Conducted during 03 September 2024 to 03 October 2024.

ii) Vigilance Awareness Trainings were conducted as per the directions from Central Vigilance Commission covering the
employees, entry level managers and mid-level managers who have at least 10 years of experience.

iii) Themes: Ethics and Governance, Conduct Rules (CDA Rules), Conduct Rules (Standing Orders), Systems and
Procedures of the Organization (NOC, Higher Education, FR56J, Grievance Procedure, Pension, PSMB etc), Cyber
hygiene and Security, Procurement.

15.1.2 Skill & Knowledge Programmes:

i) Various Skill based programmes viz. NDT Techniques, Comprehensive AI Fundamentals, Leveraging AI to enhance
productivity, Design and Optimization of UAVs, Industry 4.0 / QA 4.0

ii) Knowledge Programmes: SAP Functional Modules (MM & PP), DPR course on Media, Defence Acquisition
Management Course, Mission Design and Avionics at IIST Trivandrum by ISRO etc. were conducted to stay abreast
of the latest technological advances in the industry.

15.1.3 Utilization of iGOT Karmayogi (Integrated Government On-line Training):

This is an online learning and career management platform for Government Employees. Over the years, the idea is to
acclimatize employees with iGOT trainings along with the regular in-house and External trainings, so as to maximize the
learning appetite and to become a learning organization. All the employees were encouraged to complete 5 training
capsules as pilot phase. About 87% employees were registered till FY 2024-25 and about 33% employees have completed
the following courses:

i) Prevention of Sexual Harassment of Women at Workplace

ii) Introduction to Emerging Technologies

iii) Orientation Module on Mission LiFE

iv) Stay Safe in Cyber Space

v) Code of Conduct for Government Employees

15.1.4 Outbound Training (Team Building activities) on Breaking Barriers, Building Futures:

As part of Women’s Day celebrations an outbound training was conducted on 08 March 2025 to empower the women
employees wherein about 300 women across all Units have participated.

15.1.5 Special Workshops and Trainings conducted:

i) On International Day of Disabled Persons, a workshop for Persons with Benchmark Disabilities (PwBDs) was held on
03 December 2024.

ii) Special Training Programmes for SC, ST, OBC, Ex-servicemen & PwD Associations and EC Members of Registered
Union were trained on Reservations and Rosters, Role of Union in CPSEs to promote diversity and inclusion.

15.1.6 Prime Minister Internship Scheme:

i) Phase 1 of PMIS has commenced from 02 December 2024 with target of posting 250 vacancies for FY 2024-25.
On approval of Competent Authority, BDL has published vacancies for 250 nos. of Interns under Prime Minister’s
Internship programme in FY 2024-2025 across all Units of BDL.

ii) These Interns are being provided with Lunch, Transport, Accommodation, Medical facilities and Mentoring apart
from providing the Internship Allowance.

16. PARTICULARS OF EMPLOYEES:

No employee of the company received remuneration in excess of the limits prescribed under Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014. Furthermore, in accordance with Ministry of Corporate
Affairs Notification No. GSR 463(E) dated 05 June 2015, Government Companies are exempt from the provisions of Section 197
of the Companies Act, 2013 and the rules made thereunder.

17. FOREIGN VISITS:

Your company incurred an expenditure of around 7 3.36 crore during the year under report towards foreign travel for business
trips.

18. INDUSTRIAL RELATIONS AND EMPLOYEE WELFARE:

Your company maintains cordial and harmonious industrial relations through the cooperation of all employee sections, including
the Recognized Trade Union and associations for SC, ST, OBC, Ex-Servicemen, and Officers. Statutory and non-statutory
committees like the Works Committee, Safety Committee, Canteen Managing Committee, and Welfare Committee play a key
role in maintaining workplace discipline.

Compliance with statutory welfare provisions is strictly followed. The Post Superannuation Medical Benefit Scheme addresses
the medical needs of retired employees and their families. There is cordial cooperation between the Recognized Trade Union and
all associations and the Management, ensuring smooth functioning of the organization.

19. SECURITY:

The Central Industrial Security Force (CISF) is responsible for providing security and fire services at both the Kanchanbagh
and Bhanur Units, playing a crucial role in ensuring the security and protection of the company’s property. The CISF team has
implemented robust security measures, combining physical measures and advanced technology to maintain the security of highly
sensitive installations

To oversee the security arrangements and the implementation of Intelligence Bureau (IB) guidelines, the Plant Security Council
is in place. Regular security review meetings are conducted by both the management and CISF to enhance security measures.

In addition to computerized photo identity cards, a Biometric Access Control System has been implemented to prevent
unauthorized entry. CCTV cameras are installed throughout the factory premises to expand the coverage of CCTV surveillance.
Door frames, metal detectors, and X-ray baggage machines are also utilized. Barricades, boom barriers, and mochas are provided
to reinforce physical security measures.

Regular security awareness programs are conducted, along with the observation of Security Week and Fire Week. Employees are
sensitized to security threats and educated on the appropriate actions to be taken during emergencies and fire accidents.

20. SAFETY:

BDL stringently follows, applicable norms to maintain Safety, Health and Environment (SHE). The two Safety Committees i.e.
Industrial Safety Committee and Explosive Safety Committee monitor Safety, Health and Environment (SHE) at regular intervals
at BDL, KBU. The Industrial works are carried out in compliance with Factories act 1948, and explosive safety is stringently
adhering to the Storage & Transport of Explosive Committee (STEC-2017) regulations framed by Centre for Fire, Explosive &
Environment Safety, (CFEES) MoD, New Delhi. Safety committee meetings are conducted periodically to monitor the Safety,
Health and Environment as per the statutory norms. The safety related issues are reviewed at regular intervals by General
Manager/Unit Head for compliance.

During the year, Industrial Safety audit was conducted by Deputy Chief Inspector of Factories, Telangana State and observations
made are duly addressed. Annual Explosive safety audit was conducted by Centre for Fire, Explosive & Environment Safety
(CFEES) New Delhi and necessary actions are taken based on their observations. EMS (ISO 14001:2015) surveillance (external)
audit was also successfully completed in Feb-2024 without any NC’s/observations.

4 March 2025 is observed as 54th National safety day Campaign, this event observed for entire week from 4 March-11 March
of 2025. In this campaign various events like Safety pledge was administered at the main gate entrance, different workstations
of concerned departments, safety badges distributed to all, safety day banners displayed, various competitions like safety slogan,
essay & elocution conducted in Hindi/Telugu/English languages, safety quiz and basic first aid firefighting demo conducted
as safety promotional activities. Followed by 54th National Safety Day Campaign valedictory function conducted chaired by
Director (Production) & Executive Director (Unit Head) with special guests Director of Factories & Joint Chief Inspector of
Factories, Telangana State.

In terms of training programs, both in-house and external trainings are regularly conducted for employees on industrial and
explosive safety. During the year, a special program was organized on “Train the Trainer - Explosive Safety” which was delivered
by Retd., Director (CFEES) and followed by a technical session on Static Electricity which was delivered by M/s. 4S Techno
Systems, Hyderabad. Special medical checkups are carried out for employees working in Electroplating and Canteen. Periodical
medical checkups are carried out for employees working in other areas. Fire mock drills are conducted at regular intervals to
ensure firefighting preparedness.

Safety Engineering Department is in continuous interaction with Inspector of Factories, Telangana, State Pollution Control Board
(TSPCB) and Centre for Fire, Explosive & Environment Safety (CFEES) MoD, New Delhi and complying with their guidelines,
issued from time to time.

As per the company’s environmental policy, your company is committed to manufacturing and supplying defence products to the
Indian armed forces in an environmentally friendly manner. The key environmental commitments include:

i) Protecting the environment and preventing all types of pollution.

ii) Fulfilling compliance obligations.

iii) Conserving natural resources.

v) Continually improving to enhance environmental performance.

Your company demonstrates a strong commitment to environmental sustainability and compliance with regulations through
various initiatives and certifications. Here are the key environmental management practices and measures in place across all
three units—Kanchanbagh, Bhanur, and Visakhapatnam:

21.1 Environmental Management Practices:

21.1.1 ISO 14001:2015 Certification:

All units are recertified with ISO 14001:2015 (EMS) to assess pollution levels and ensure compliance with legal
requirements.

21.1.2 Waste Management:

i) Plastic Use Reduction: Issued a circular to discourage the use of plastics.

ii) E-waste and Hazardous Waste: Disposed of through agencies registered with the Pollution Control Board.

iii) Solid Waste: Disposed of through M/s MSTC, a government undertaking, specifically ferrous and non-ferrous
metals.

iv) Biomedical Waste: Disposed of through an agency registered with the Pollution Control Board.

v) Housekeeping: Proper practices are maintained to ensure a clean and safe environment.

21.1.3 Zero Liquid Discharge System:

i) Effluent Treatment: Treated water from the effluent treatment plant undergoes further treatment through reverse
osmosis (RO).

ii) Usage of Treated Water:

- RO treated water is utilized in the Demineralized Water (DM) plant for producing DM Water.

- DM Water is used in the Electroplating Shop, CNC machines, and flow forming machines in the Workshops.

iii) Gardening: Treated water from the sewage treatment plant is used for gardening within the premises.

21.1.4 Audits and Monitoring:

i) Internal and Surveillance Audits: Conducted at regular intervals by certification bodies for all units.

ii) Environmental Parameters Monitoring:

- Ambient air quality, stack quality of DG sets/venturi scrubbers, sewage treatment plants, and effluent treatment
plants.

- Noise levels tested as per specified frequencies.

iii) Resource Monitoring: Water quantity monitored using separate water meters and electricity consumption is tracked
to comply with consent conditions.

On the occasion of World Environment Day, the Prime Minister of India launched a global campaign, “#EkPedMaaKeNaam”
/ “#Plant4Mothers.” In support of this initiative, BDL planted 8,366 saplings of various species, including Mango, Guava,
Lemon, Coconut, Amla, Pomegranate, Neem, Orange, Peepal, Teak, Tamarind, Chilbil, Sababia Roja, Gulmohar, Pagoda, Kala
Jamun, Spanish Cherry, Terminalia, Spathodea, Caesalpinia, Cassia Javanica, Jacaranda, and Tecoma Gaudichaudi, covering
a total area of 15.13 acres.

World Environment Day 2024 was celebrated with great enthusiasm across all BDL units. Banners were displayed at
prominent locations, and saplings were planted on 5 June 2024 to mark the occasion. Slogan writing, essay writing, and
quiz competitions were organized based on the theme “Land Restoration, Desertification, and Drought Resilience.” Prizes
were distributed to the winners during the valedictory function.

The then General Manager and Unit Head (VU) addressed the gathering on the theme "Land Restoration, Desertification, and Drought Resilience.”
Guest speaker Prof. Dr. S. Bala Prasad from the Department of Environmental Engineering, Andhra University, Visakhapatnam, delivered a speech on
the theme and its significance in translating sustainable practices into day-to-day activities aimed at creating a healthier and greener planet. Prizes

were also distributed to the winners during the valedictory function.

22. QUALITY:

All production divisions/units including Akash, CP-IGMP, Design & Engineering, Electronics Division of Kanchanbagh Unit, Bhanur,
and Visakhapatnam Units are certified with AS 9100D, an aerospace quality management system standard. Kanchanbagh, Bhanur,
and Visakhapatnam Units are also certified with ISO 14001:2015 (EMS), which is an environmental management system standard.
The Corporate Office is certified with ISO 9001:2015 (QMS), which focuses on quality management systems. The Material
Testing Lab, Electronics Lab, and Standard Labs are certified with ISO/IEC 17025:2017, which pertains to the competence of
testing and calibration laboratories. The Electronics Division is certified with AFQMS (Air Force Quality Management System).
Furthermore, BDL holds the ISO/IEC 27001:2022 certification for information security management systems (ISMS). Internal
audits for all ISO/AS certified divisions are conducted by the company’s own internal auditors, while surveillance audits are
carried out by certification bodies as per the prescribed frequency.

In addition to these certifications, your company is committed to continuously improving customer satisfaction through customer
meets and interactions with users. Corrective actions are implemented wherever necessary to drive improvement in processes
and meet customer expectations.

23. OFFICIAL LANGUAGE (OL) IMPLEMENTATION:

23.1 Implementation of OL Act-1963 (as amended 1967) & Rules thereunder are ensured. Quarterly OLIC Meetings were held
regularly under the Chairmanship of CMD and Directors, besides submission of Quarterly progress reports on use of OL,
which are sent in time to authorities concerned.

23.2 In compliance with the Official Language (OL) Act, 1963 and the Presidential Orders thereon, the papers laid before
Parliament, the Annual Report of the Company, the Memorandum of Understanding (MoU) with the Ministry of Defence
(MoD), and brief presentations for various Parliamentary Committees and delegations are prepared in bilingual format and
submitted accordingly.

23.3 In compliance to the assurances and directives of Parliamentary Committee on OL, ‘A series of Hindi Workshops’ were
organized wherein a total of 512 nos. of officials were covered in 20 Hindi Workshops organized during the year with
an objective to integrate the use of Hindi effectively in day-to-day functioning. During the workshops, fulfilling the
assurances given to the parliamentary Committee on OL and its action plan was discussed and implanted later. Also, the
use of ‘Kanthasth 2.0’ a memory based translation software developed by Department of Official Language, GoI was also
discussed with its hands on training for effective implementation of OL in day-to-day functioning. To promote the original
writing in Hindi in Technical and Non-Technical areas with detail coverage of OL activities of the Organization, a dedicated
Hindi e-Magazine of the Organization titling “BDL BHARATI” (2nd & 3rd issues) was released and issued.

23.4 An “Orientation Program on OL Policy” was organized on 7 March 2025 for newly joined executives. The DGM (HR-OL)
briefed the trainee officers on the Official Language Policy of the Government of India, emphasizing the role of executives
in its implementation and encouraging them to use Hindi in their routine work.

23.5 BDL was awarded the “TOLIC Rajbhasha Trophy” for the best implementation of the Official Language among PSUs in the
twin cities. The trophy and certificate were presented by the CMD of ECIL & Chairman, TOLIC (Undertakings) to the DGM
(HR-OL) at the 59th Half-Yearly Meeting held on 28 May 2024.

23.6 Hindi Fortnight 2024 was celebrated from 10 to 26 September 2024 at the Corporate Office and across all units. Various
competitions were organized, including ‘Vocabulary-Noting-Drafting’, ‘Hindi Dictation’, ‘Hindi Typing on Computers’,
and ‘Multimedia Hindi Quiz’ for officers and employees at the Corporate Office, Kanchanbagh Unit, Bhanur Unit,
and Visakhapatnam Unit. BDL also participated in Hindi Diwas and the 4th All India OL Conference organized by the
Department of Official Language, MHA, GoI, from 14 to 15 September 2024 at Bharat Mandapam, New Delhi. The
valedictory program for the Hindi Fortnight was held on 26 September 2024 under the chairmanship of the CMD, with
Directors, Unit Heads, and senior officials in attendance. Cash awards were presented to the winners of competitions and
to employees recognized for original work in Hindi during the year.

23.7 To mark the golden jubilee of the Constitution of India and the Official Language, a special program was organized on 5
March 2025. A lecture session included a documentary on the Constitution and a presentation covering its key features
and creation. In the second session, the DGM (HR-OL) spoke on the role of the Official Language in national development
and highlighted various Government initiatives to promote and propagate Hindi.

23.8 A ‘Hindi Kavya Goshthi’ was organized on 7 March 2025 to encourage creative writing among executives and non¬
executives. Dr. Surabhi Dutt, a political science academician, and Dr. Rajeev Singh, an eminent writer and academician,
were the chief guests. Besides the guests, BDL executives also presented their poems during the event.

23.9 On occasions such as Republic Day, Independence Day, Vigilance Awareness Week, Swachhata Pakhwada, and Constitution
Day, programs were conducted in both Hindi and English. The company’s Hindi website was regularly updated in line
with Government directives. Officers and employees also participated in Inter-PSU competitions conducted by TOLIC
(Undertakings) and won eight prizes.

23.10 To promote the use of Hindi and encourage reading habits among officers and employees, BDL subscribes to a variety of
Hindi magazines and newspapers, including Hindi Milap, Swatantra Vaartha, Daily Shubha-Labh, Anuvad, Sahitya Amrit,
Avishkar, Yojana, Hindi Rozgar Samachar, Pratiyogita Darpan, Meri Saheli, and Hans. Additionally, popular Hindi books on
various subjects are purchased annually as per the directives of the Department of Official Language.

24. VIGILANCE:

24.1 Preventive/ proactive vigilance has been the primary objective of Vigilance Department of the Company. As a part of its
proactive vigilance measure, the department has issued 11 Systemic Improvement Suggestions in the areas of e-reverse
auction, Recruitment, Departmental Promotion, Reservation, Sensitive Area Rotation, Civil works and Service Contracts
etc. and of which many have been implemented by the Management during the year under report. Brief of all the Systemic
Improvements have been hosted on BDL website https://bdl-india.in.

24.2 In furtherance of its preventive vigilance approach, as directed by Hon’ble CVC as a prelude to observance of Vigilance
Awareness Week-2024, various preventive vigilance measures were undertaken in 3-months campaign made across units
of the Company during 16 August 2024 to 15 November 2024 in the following focus areas:

- Capacity Building Programs

- Identification and implementation of Systemic Improvement measures

- Dynamic Digital Presence

- Updation of Circulars/ Guidelines/ Manuals

- Disposal of complaints received before 30 June 2024

24.3 Being an extended arm of the Central Vigilance Commission (CVC), New Delhi, the department has submitted various
reports i.e., Monthly, Quarterly, Annual & CTE Type to the Commission and also to Department of Vigilance, Ministry of
Defence and to the Board of the Company. The Department has also issued vigilance clearances to employees in cases of
Recruitment, Promotion, Absorption, Confirmation, Foreign visits, for postings in sensitive areas etc. The department has
also accorded priority in handling the complaints as per the complaint handling policy of the CVC.

24.4 As part of the observance of Vigilance Awareness Week during the campaign period, Smt. G Sreedevi Retd, Justice of High
Court of Telangana, visited Kanchanbagh Unit of BDL on 04 November 2024. On her visit to the Company, Smt. G Sreedevi
was briefed about BDL by Commodore A. Madhavarao (Retd.), Chairman & Managing Director, BDL. A presentation was
made by Shri K. Srinivas, AGM & HoD (Vigilance) about the vigilance activities at BDL and the preventive vigilance activities
being undertaken in campaign period. In her keynote address to the gathering of senior management executives, the chief
guest appreciated the vigilance initiatives of BDL. During her address, she has highlighted the significance of Vigilance
Awareness Week and exhorted all to be vigilant about irregularities. She has underlined the need for transparency and
enhancing awareness among the employees about vigilance.

24.5 Observation of Vigilance Awareness Week is an integral part of the Vigilance department. As directed by the Central Vigilance
Commission, Vigilance Awareness Week (VAW)-2024 with the theme “Culture of Integrity for Nations Prosperity” was
observed across units of Bharat Dynamics Limited from 28 October 2024 to 03 November 2024. The observance of VAW-
2024 commenced with Commodore A. Madhavarao (Retd.), Chairman and Managing Director (CMD), BDL administering
‘integrity pledge for citizens’ at 11 AM on 28 October 2024 at BDL-Kanchanbagh Unit. Employees of Corporate Office,
Bhanur Unit, Visakhapatnam Unit and lbrahimpatnam Unit participated in the ceremony through video-conference and took
integrity pledge. This was followed by reading out messages of Hon’ble President of India, Hon’ble Vice-President of India,
Hon’ble Prime Minister of India by Directors and message of CVC by HoD (Vigilance) to the august gathering. The program
was live across units of the company through video conference. A total of 2310 employees of BDL have taken the Integrity
Pledge during observance of vigilance awareness week.

24.6 In order to create awareness on vigilance and the importance of it in day-to-day life, various competitions such as Essay
Writing, Elocution, Slogan Writing, Poster making on issues relating to Anticorruption were conducted for employees,
spouse and children of employees during the Vigilance Awareness Week-2024. ‘Integrity pledge for Citizens’ was
administered to the students. Special emphasis was given to involve youth in various activities and as a part of it, Debates
on topics related to anti-corruption were conducted in colleges in Hyderabad and Visakhapatnam.

24.7 As part of Vigilance Awareness Week - 2024, Sensitization programs for employees on matters relating to the Role of
Inquiry Officer (IO) & Presenting Officer (PO), Ethics and Governance, Public Procurement, Cyber Hygiene and security,
Systems and Procedures of the Organization, Complaint Policy of CVC and Disciplinary Proceedings procedure etc., were
conducted across units of the company.

24.8 To spread awareness on the theme of “Culture of Integrity for Nations Prosperity” and to sensitize employees of BDL and
public at large, banners on the theme were displayed at conspicuous places across units of the company and in public
places too. To promote citizens to take eve ‘e-integrity pledge’, a link of eve website was hosted in the BDL website. Short
telephonic messages were sent to all employees encouraging to be a part of “Vigilance Awareness Week-2024” and to take
integrity pledge clicking by the link http://pledge.cvc.nic.in.

24.9 In order to spread the messages to public about the ill effect of corruption on society and the importance of self¬
reliance & integrity in life, a walkathon was organized by Bhanur Unit at Kyasaram village on 30 October 2024. Students,
youth, personnel from CISF Unit of BDL Bhanur Unit, BDL employees, local leaders and the general public participated
enthusiastically in the Walkathon. ‘Integrity Pledge’ was administered to the participants on the occasion. Shri P V Rajaram,
Director (Production), BDL has flagged-off the walkathon along with representatives of the Municipality Officials. Public
were appraised of the need to ensure integrity in their day-to-day life and commit to the development of the Nation by
saying ‘no’ to corruption. Placards and banners with slogans on ill effects of corruption were displayed.

24.10 Online Vendor Meet was organized by Corporate Commercial Department of BDL on 29 October 2024 at Corporate
Office, 150 vendors of BDL participated. A presentation on the provisions of Integrity Pact (IP) and role of Independent
External Monitor (IEM) was made on this occasion.

The 5th edition of “CHETANA”- annual vigilance newsletter was released during valedictory function of
VAW-2024 by Chief Guest Smt. G Sreedevi Retd., Justice of High Court of Telangana on 04 November 2024.

25. ANTI-BRIBERY AND ANTI-CORRUPTION POLICY:

Your company has zero tolerance approach to bribery and corruption. Your company prohibits all forms of bribery and corruption
whether involving, but not limited to Government Officials or a Private Sector persons or Company and whether directly or
indirectly. The Board of Directors had approved a policy on Anti-Bribery and Anti-Corruption and the same was hosted on
website of the Company https://bdl-india.in/sites/default/files/BDLACABPolicy_0.pdf .

26. BOARD OF DIRECTORS:

26.1 The Board of Directors of the Company comprises Functional Directors, Government Nominee Directors and Independent
Directors (i.e. Non Official Part Time Directors) who are appointed by the Government of India from time to time. Further,
the tenure and remuneration of Functional Directors including Chairman and Managing Director are decided by the
Government of India through Public Enterprises Selection Board/Search Committee. The Government communication also
indicates the detailed terms and conditions of their appointment including a provision for the applicability of the relevant
rules of the Company.

26.2 The Government Nominee Directors are not entitled to any remuneration/sitting fee. The Independent Directors (i.e. Non
Official Part Time Directors) are entitled to sitting fees for attending the Board/Committee meetings as approved by the
Board, considering the government directives, statutory acts, rules and regulations.

26.3 Independent Directors (i.e. Non Official Part Time Directors)

During the year, out of six (6) Independent Directors, the term of office of five (5) Independent Directors namely Shri. Sunil
Chintaman Mone, Shri. Nandakumar Subburaman, Dr. Pawan Sthapak, Prof. (Dr.) Sanghamitra Mishra and Shri Rajendra
Singh Shekhawat was completed in the month of December, 2024. The Board expresses its gratitude for the valuable
contributions made by them during their tenure.

The Ministry of Defence, Government of India vide its letter No. -M0001(11)/3/2018-D(BDL) dated 22.04.2025 appointed
Shri.Chetan Bansilal Kankaria as Part-time Non-Official Independent Director for a period of one year or until further orders,
whichever is the earliest.

Statement on declaration by Independent Directors:

Independent Directors have given declarations u/s 149(7) of the Companies Act, 2013 that they meet the criteria of
independence as laid down u/s 149 (6) of the said Act.

26.4 During the year, the Ministry of Defence, Government of India has appointed Shri. D. V. Srinivas as Director (Technical)
of BDL vide their letter No. DDP-M0001(11)/4/2023-D(BDL) -dated 20 September 2024 and Shri. G. Gayatri Prasad as
Director (Finance) of BDL vide their letter No. DDP-M0001(11)/3/2023-D(BDL)-dated 18 December 2024.

26.5 In accordance with the provisions of Section 152 of the Companies Act, Shri. U. Raja Babu, Govt Director, retires by rotation
at the upcoming Annual General Meeting and, being eligible, offers himself for reappointment.

26.6 Number of Meetings of Board:

During the year 2024-25, six (6) Board Meetings were held on 30 May 2024, 09 August 2024, 25 October 2024,
14 November 2024, 09 December 2024 and 06 February 2025.

26.7 Performance Evaluation:

The provisions of Section 134(3)(p) of the Companies Act, 2013 relating to evaluation of Board of Directors do not apply
to your company since necessary exemptions are provided to all government companies. Further, similar exemptions were
granted to your company by Securities Exchange Board of India (SEBI) under the provisions of SEBI (Listing Obligations and
Disclosure Requirements {LODR}) Regulations, 2015 vide their letter No. SEBI/HO/CFD/DIL1/OW/P/2018/1679/1 dated
17 January 2018.

26.8 Committees of the Board

The following are the statutory Committees constituted by the Board and they function according to their respective roles
and defined scope:

• Audit Committee

• Nomination and Remuneration Committee

• Corporate Social Responsibility and Sustainability Development Committee

• Stakeholders Relationship Committee

• Risk Management Committee

Details of composition, terms of reference and number of meetings held for respective Committees are given in the Report
on Corporate Governance, which forms a part of this Annual Report.

27. DIRECTORS' RESPONSIBILITY STATEMENT:

As per Section 134(3)(C) and 134(5) of the Companies Act, 2013 as amended, the Directors state that:

(i) in the preparation of the annual accounts, the applicable Accounting Standards have been followed along with proper
explanation relating to material departures.

(ii) Directors have selected such accounting policies and applied them consistently and judgments and estimates made are
reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31 March 2025 and
of the profit of the company for the year ended on that date.

(iii) Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud
and other irregularities.

(iv) Directors have prepared the annual accounts on a going concern basis.

(v) Directors have laid down internal financial controls which are being followed by the company and that such internal financial
controls were adequate and operating effectively and

(vi) Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such
systems were adequate and operating effectively.

28. SIGNIFICANT AND MATERIAL ORDERS:

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

29. EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

Material changes and commitments affecting the financial position of the company which have occurred between 31 March
2025 and date of signing of this Report are - Nil.

30. AUDIT COMMITTEE:

During the year 2024-25, four (4) Audit Committee meetings were held to review internal control systems and their adequacy,
including coverage of Audit functions. Details of composition, terms of reference, etc., are covered in Report on Corporate
Governance.

31. CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY DEVELOPMENT:

31.1 Pursuant to the provisions of Section 135 of the Companies Act, 2013 and The Companies (Corporate Social Responsibility)
Rules, 2014 read with various clarifications/amendments issued by Ministry of Corporate Affairs & DPE guidelines, the
company has undertaken various activities as per the CSR Policy. The programmes / initiatives / projects are taken up in
line with the Schedule-VII of the Companies Act-2013, which are duly incorporated in CSR policy and forms the guiding
principle for all our programmes. The Board of Directors of your company has Board Level Committee on Corporate Social
Responsibility and Sustainable Development (CSR & SD) (please refer Corporate Governance Report) in line with the
provisions of Section 135 of the Companies Act, 2013. The Committee has formulated and recommended CSR Policy to
the Board indicating the projects/activities to be undertaken by the company as specified in Schedule VII of the Companies
Act, 2013.

31.2 Your company has been very conscious about its responsibilities towards society. Your company has also ventured into
backward/ under developed areas in Andhra Pradesh and Telangana to undertake Corporate Social Responsibility (CSR)
activities by sponsoring various schemes.

31.3 The core areas of focus under CSR are Health Care, Nutrition, Education & Literacy, Skill Development & Sustainable
Livelihoods, Sanitation, Safe Drinking Water etc. Your company also adopted villages in Andhra Pradesh and Telangana
State under Corporate Social Responsibility initiative and the focus is on the necessities of human life-health, water and
other conveniences.

31.4 The CSR and SD activities are monitored periodically by the Committee and a detailed annual report on CSR and SD
activities undertaken during the year 2024-25 is enclosed at Annexure-I.

31.5 During the year 2024-25, the CSR & SD obligation was 1:1288.23 lakh. Against the total CSR obligation, the company
has incurred an expenditure of 11334.13 lakh and achieved 100% CSR target amount required under the provisions of
Companies Act, 2013. CSR activities being undertaken are placed on Company’s website https://bdl-india.in/csr-projects

32. RISK MANAGEMENT:

The company has a Board approved Risk Management Policy. The policy aims at elimination or reduction of risk exposures
through identification and analysis of various types of risks and facilitating timely action for taking risk mitigation measures. The
policy envisages that all programs, project reviews will highlight the progress of risk mitigation plans till the closure and signing
off the mitigation plans.

Pursuant to the Reg. 21 of SEBI (LODR) Regulations, 2015, the company has constituted a Risk Management Committee. The
details of Committee and its terms of reference, Risk Management Policy etc. are set out in the Corporate Governance Report.

33. ANNUAL RETURN:

In accordance with the provisions of the Companies Act, 2013, Annual Return of the company for the year under report is
available on the company’s website https://bdl-india.in/annual-reports

34. RELATED PARTY TRANSACTIONS:

There are no materially significant related party transactions during the year under review which may have a potential conflict
with the interest of the Company at large. Thus, disclosure in Form AOC-2 is not required. Members may refer to the notes to the
accounts for details of related party transactions. The policy for related party transaction has been uploaded on the Company’s
website https://bdl-india.in/sites/default/files/PolicyonRelatedPartyTransactions_1.pdf

35. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are
given in the notes to the Financial Statement.

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

Your company, being a Defence PSU, the disclosure of information with respect to conservation of energy, technology absorption,
foreign exchange earnings and outgo under the provisions of Section 134(3)(m) read with Rule 8(3) of the Companies (Accounts)
Rules, 2014 (as amended) is not required as the Ministry of Corporate Affairs vide Notification GSR No.680 (E) dated 4 September
2015 has granted exemption to Defence Public Sector Undertaking.

During the year, your company as a part of energy conservation measures, procured and installed LED lights (14032 Nos.), BLDC
Fans (744 Nos.), 5 Star Rated ACs (74 Nos.), IE3 Motors (30 Nos.), e-mobility (2 wheelers -3 Nos. & 4 wheelers - 5 Nos.). By
installing the above, your company has adopted energy conservation measures across BDL. BDL had installed two 5 MW solar
power plants of each (Land based) and 200 KW (Rooftop) inside the premises at Kanchanbagh and Bhanur respectively. Further,
planned to install 0.5 MW solar power plant (rooftop) at Visakhapatnam unit.

37. INTERNAL CONTROL SYSTEMS:

Your company had put in place all required internal controls and systems to meet the canons of financial propriety. External
audit firms are appointed to ensure their adequacy and report thereon. Detailed analysis of reports of Internal Audit Firms
as well as reports of Internal Audit Department of your company is placed before the Audit Committee for its review and
advice. The adequacy of internal control procedures is being reviewed and reported by Statutory Auditors in their Audit Report.
The necessary disclosures have been made in Notes to Accounts. Your company being a Government Company is subject to
Government Audit also.

38. AUDITORS:

Statutory Auditor:

M/s. Tej Raj & Pal, Chartered Accountants, Hyderabad were appointed as Statutory Auditors of the company for the financial
Year 2024-25 by the Comptroller & Auditor General of India. The Auditors have audited the Accounts and does not contain any
qualification, reservation or adverse remarks

The Auditors’ Report on the financial statements for the financial year 2024-25 and the Comments of Comptroller and Auditor
General of India (C&AG) under Section 143 (6) of the Companies Act, 2013 are appended to the Annual Report.

Cost Auditor:

Your company appointed M/s. Narasimha Murthy & Co., Cost Accountants, Hyderabad as Cost Auditors for the FY 2024-25 for
the audit of the cost records of the Company. The company maintains cost records as specified by the Central Government under
section 148(1) of the Companies Act, 2013 in respect of its manufacturing activities.

Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 (as amended), M/s. C.V.Reddy K & Associates, Practicing Company Secretaries ( PCS
Registration No.7976) has conducted Secretarial Audit of the company for the financial year 2024-25. The Secretarial Audit
Report is appended to the Annual Report.

In compliance with Regulation 24A of the SEBI Listing Regulations and Section 204 of the Act, the Board at its meeting held
on 27 May, 2025, has approved the appointment of M/s. C.V.Reddy K & Associates, Practicing Company Secretaries, a peer
reviewed firm (Firm Registration No.6517/2025) as Secretarial Auditors of the Company for a term of five consecutive years
commencing from FY 2025-26 till FY 2029-30, subject to approval of the Members at the ensuing AGM.

39. CEO / CFO CERTIFICATION:

As per the requirements of SEBI Listing Regulations and DPE Guidelines, the CEO/CFO certificate has been obtained and placed
before the Audit Committee and the Board.

40. REPORTING OF FRAUDS BY AUDITORS:

During the year, neither the Statutory Auditor nor the Secretarial Auditor have reported to the Audit Committee/Board under
Section 143(2) of the Companies Act, 2013, any instance of fraud committed against the Company by its officers or employees,
the details of which needs to be mentioned in the Board’s Report.

41. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Report required under the SEBI (LODR) Regulations, 2015 and also under the DPE
Guidelines on Corporate Governance for Central Public Sector Enterprises (CPSEs), is attached to this Report as Annexure II.

42. CORPORATE GOVERNANCE:

42.1 Corporate Governance is about application of best management practices, compliance of laws and adherence to ethical
standards to achieve Company’s objective of enhancing stakeholders’ value and discharge of social responsibility. The
Company has a well-established, transparent and fair administrative set up to provide for professionalism and accountability.

42.2 As per the guidelines on Corporate Governance for CPSEs issued by DPE vide its OM No. 18 (8)/2005-GM, dated 14
May 2010 and in terms of the SEBI (LODR) Regulations, 2015, Report on Corporate Governance along with Certificate on
compliance of conditions on Corporate Governance from a Practicing Company Secretary are attached to this report as
Annexure-III.

42.3 Quarterly and Yearly compliance reports on Corporate Governance are being forwarded to Stock Exchanges and MoD in
the prescribed format.

42.4 The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings
of the Board of Directors and General Meetings.

42.5 No proceedings are made or pending under the Insolvency and Bankruptcy Code, 2016 and there is no instance of
onetime settlement with any Bank or Financial Institution.

42.6 There has been no change in the nature of business of the Company.

43. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION &
REDRESSAL) ACT, 2013:

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified in the
company. In line with the Guidelines received from time to time, necessary actions have been taken to prevent Sexual Harassment
of Women at Workplace. The BDL CDA Rules applicable to Officers and the Certified Standing Orders applicable to Workmen
have the required provisions in this regard. The Internal Complaints Committees as per Section 4 of the Act have been put in
place. During the year 2024-25, no sexual harassment complaints were received by your company.

44. COMPLIANCE UNDER THE RIGHT TO INFORMATION ACT, 2005:

The information required to be provided to citizens under Section 4(1)(b) of Right to Information Act, 2005 is placed on
Company’s Website https://bdl-india.in//sites/default/files/Info-on-BDL.pdf. It contains general information of the company,
functions, powers and duties of employees/officers, decisions making process, rules, regulations, manuals and records held by
the company, directory of the Company’s Officers, pay scales of officers/ employees and procedure for seeking information and
inspection of records. The company has nominated a Central Public Information Officer of Senior Manager Level to attend to
queries and appeals.

During the year 2024-25, the CPIO has received 185 applications/queries, out of which 173 applications have been disposed-
off and 9 (Nine) application is transferred to other Public Authority. 3 (Three) RTI queries are under process. Further, out of 19
appeals received, 17 are disposed-off by Final Appellate Authority and 2 (Two) are under process as on 31 March 2025.

45. VIGIL MECHANISM/ WHISTLE BLOWER POLICY:

Pursuant to the provisions of the Section 177(9) of the Companies Act, 2013 read with Rule (7) of the Companies (Meeting of
the Board & its Power) Rules, 2014 (as amended) and DPE Guidelines for CPSEs, the Board of Directors had approved the policy
on Whistleblower/Vigil Mechanism and the same was hosted on website of the company https://bdl-india.in/sites/default/files/
WBP.pdf. The policy inter-alia provides a direct access to the Chairman of the Audit Committee.

Employees are encouraged to raise any of their concerns by way of whistle blowing and none of the employees have been denied
access to the Audit Committee.

46. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:

The Securities and Exchange Board of India (SEBI) has mandated inclusion of Business Responsibility and Sustainability Report
(“BRSR”) as part of the Annual Report based on market capitalization. Your Company has prepared a comprehensive policy
framework for BRSR, after studying the SEBI (LODR) Regulations, 2015 (as amended) requirements and keeping in view the
business and governance environment in which BDL as a Defence PSU operates. The company’s BRSR for the year is available
on the BDL’s website at https://bdl-india.in/sites/default/files/BRSR-24-25.pdf

47. DIVIDEND DISTRIBUTION POLICY:

In terms of SEBI (LODR) Regulations, 2015 (as amended), dividend distribution policy has been adopted by your company to set
out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend
to its shareholders and/or retaining the profit into the business. The policy is available on the BDL’s website https://bdl-india.in/
sites/default/files/DividendDistributionPolicy_1.pdf .

48. ACKNOWLEDGEMENT:

48.1 Your Directors gratefully acknowledge and express their appreciation for the cooperation extended and guidance provided
by various Government Agencies, including the Ministry of Defence, DPSUs, Department of Defence Production, DRDO
Laboratories, Central Government Departments, State Governments of Telangana and Andhra Pradesh, Quality Assurance
Agencies of the Government of India, and other PSUs. Their support has been invaluable to the company, and your
Directors are grateful for the assistance received from them on various occasions.

48.2 The company would like to extend its sincere appreciation to the Comptroller & Auditor General of India, the Principal
Director of Commercial Audit & Ex-officio Member, Audit Board, Statutory Auditors, Bankers, and Suppliers for their
cooperation, support, and guidance. Their contributions have been instrumental in ensuring the smooth functioning and
financial integrity of the company.

48.3 The Directors take this opportunity to express their deep appreciation for the valuable contributions and cooperation
of the employees at all levels. Their dedication, hard work, and commitment have played a crucial role in propelling the
company to greater heights and sustaining its growth trajectory. The Directors recognize and acknowledge the employees’
efforts and extend their gratitude for their continued support in the future.

For and on behalf of the Board
Cmde. A Madhavarao (Retd.)

Place : Hyderabad Chairman & Managing Director

Date : 27 May 2025 DIN: 09808949