The Directors have the pleasure in presenting the 2^nd Annual Report of your company along with the Audited Financial Statements for the Financial Year ended on March 31 2023. Further, in compliance with the Companies Act, 2013 the company has made all requisite disclosures in the Board Report with the objective of accountability and transparency in its operations and to make you aware about its performance and future perspective.

To support 'Green initiative', the Abridged Annual Report has been sent to the Members whose email ids are not registered with the Company/Depositories.

1. SUMMARY OF FINANCIAL PERFORMANCE

The Company's financial performance, for the period ended 31^st March 2023, is summarized below:

2. REVIEW OF OPERATIONS AND STATEMENT OF COMPANY'S AFFAIRS

The Company has been engaged in the business of wholesale trading and import-export of all kinds of hardware tools.

The revenue from operations stands at Rs. 95.05 Crores as against Rs. 60.19 Crores during the last year and the Net profit stands at Rs. 6.94 Crores during the financial year ended 31^st March 2023 as against Rs. 4.88 Crores, which is an increase of 42% from the last year's profit.

3. COVID-19

In early 2023 the world faced the impact of 3^rd Wave of COVID-19, however, there was no lockdown in the country, which ensured the smooth working of the industries, supply chains were not disrupted, factory employees were able to go to work etc.

The management is of the view that future prospects and growth of your Company will depend on the overall economic scenario. However, all necessary activities have been initiated which would give us the lead in future.

4. TRANSFER TO GENERAL RESERVES

The Company has earned a good amount of profit during the year and the management has decided to transfer, after all appropriations and adjustments, Rs. 6.94 Crores/- to the Surplus.

5. RECOMMENDATION OF DIVIDEND

Keeping in view of the growth prospects of the company, the Board has not recommended any dividend for the equity shares for the said year. However, as per the terms of issuance and as statutorily required under the provisions of the Act, the company has already made provisions of Rs. 20,000 for payment towards dividends to preference shareholders.

6. CHANGES IN THE NATURE OF BUSINESS

During the year under review there was no change in the nature of the business of the company.

7. MATERIAL CHANGES AND COMMITMENTS

There have been material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report as mentioned below:

a. The Company increased its authorized capital Company from INR 23,15,00,000/- divided into 31,50,000 Equity Shares of INR 10/- each; and 20,00,000 0.01% Preference shares of INR 100/- each to INR 30,00,00,000/- divided into 1,00,00,000 Equity Shares of INR 10/- each; and 20,00,000, 0.01% Preference shares of INR 100/- each by addition of 68,50,000 Equity shares of Face Value of INR 10/- each.

b. The company also issued Bonus Shares by capitalizing its reserves for the sum of Rs. 6,30,00,000/- to the existing shareholders of the Company in the proportion of (210:1)

Two Hundred and Ten (210) new Equity shares of nominal value Rs. 10/- each for every One (1) existing Equity Shares of nominal value Rs. 10/- each.

c. The company has also approved the raising of funds from public by getting its shares listed via Initial Public Offer. As on the date of approval of this report the company is listed on the NSE EMERGE Platform of stock exchange.

8. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS

The company has aligned its current systems of internal financial control with the requirement of the Companies Act, 2013 The Internal Control - Integrated Framework (the 2013 framework) is intended to increase the transparency and account ability in an organization's process of designing and implementing a system of internal control. The framework requires a company to identify and analyze risks and manage appropriate responses. The company has successfully laid down the frame work and ensured its effectiveness.

The company's internal controls are commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance with corporate policies. The company has a well-defined delegation of power with authority limits for approving contracts as well as expenditure. Processes for formulating and reviewing annual and long-term business plans have been laid down. It has continued its efforts to align all its processes and controls with best practices.

Gautam Sehgal & Co., the statutory auditors of the company have audited the financial statements included in this report and have issued an attestation report on the company's internal control over financial reporting (as defined in section 143 of the Companies Act, 2013).

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Company's internal financial controls were adequate and effective during the financial year 2022-2023.

9. PUBLIC DEPOSITS

During the year under review, the company has not accepted any deposit under Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

10. AUDITORSStatutory Auditor

Pursuant to the provisions of Section 139 of the Companies Act, 2013, and the rules framed thereunder, M/s. Gautam Sehgal & Co., Chartered Accountants (Firm Reg. No. 015736N), were appointed as the first statutory Auditors of the Company by the Board of Directors in its board meeting held on 20^th August, 2021, till the conclusion of first AGM, since its incorporation at such remuneration as may be mutually agreed.

Further, the Company approved the appointment of M/s. Gautam Sehgal & Co., Chartered Accountants (Firm Reg. No. 015736N), Statutory Auditors, in the first AGM, for period of five financial year, i.e. from the conclusion of the 01^st (First) Annual General Meeting (AGM) till the conclusion of 06^th (Sixth) AGM to be held in the financial year 2027.

Thereafter, there has been no change in the Auditors during the period under review.

Auditor's Report

The Auditor's Report for financial year ended 31^st March 2023, does not contain any qualification, reservation or adverse remarks. All observations made in the Independent Auditors' Report and notes forming part of the Financial Statements are self-explanatory and do not call for any further comments and also, there is no incident of fraud requiring reporting by the auditors under section 143(12) of the Companies Act, 2013 during the year under review.

The Auditor's report is enclosed with the financial statements in this Director's Report. Secretarial Auditor

The Company has not appointed the Secretarial Auditor as pursuant to provisions of Section 204 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the appointment of Secretarial audit is not applicable to the Company.

However, upto the date of approval of this report, the provisions of Section 204 of the Act became applicable on the company and accordingly, the company has appointed Ms. Prachi Agarwal (CP No. 25579) as the Secretarial Auditor of the Company for the Financial Year 2023-24.

Maintenance of Cost Records

The Directors state that the overall turnover of the company does not exceed the limit prescribed for maintenance of Cost Records as specified by the Central Government under

Section 148(1) of the Companies Act, 2013, accordingly such accounts and records are not made and maintained by the Company.

11. SHARE CAPITALAuthorized Capital

During the year under review, the Company increased its authorized capital Company from INR 23,15,00,000/- divided into 31,50,000 Equity Shares of INR 10/- each; and 20,00,000 0.01% Preference shares of INR 100/- each to INR 30,00,00,000/- divided into 1,00,00,000 Equity Shares of INR 10/- each; and 20,00,000, 0.01% Preference shares of INR 100/- each by addition of 68,50,000 Equity shares of Face Value of INR 10/- each by passing ordinary resolution in Extra ordinary General Meeting held on 18^th October 2022.

Now, the company has authorized share capital of Rs. 10 Crores, divided into 1,00,00,000 Equity shares of Rs. 10 each and Rs. 20 Crores, divided into 20,00,000 Preference shares of Rs. 100 each.

Paid-up Capital

During the year under review, the company has increased its paid-up share capital by issuing Bonus shares to the existing Equity shareholders. As on 31^st March 2023 the company's Paid-up capital stood as follows:

However, upto the date of approval of this report the Equity Paid-up capital of the company was further increased to Rs. 8,60,64,000/- via Initial Public Offer of securities and consequent listing on NSE EMERGE Platform. Therefore, upto the date of approval of this report the Total Paid up capital of the company stood as follows:

12. EXTRACT OF THE ANNUAL RETURN

Pursuant to Section 92(3) of the Companies Act, 2013, read with Section 134(3)(a) and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return is available on the website of the Company at www.deneerstools.com.

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

The particulars as prescribed under sub-section (3)(m) of Section 134 of the Companies Act, 2013, read with Rule 8(3) of Companies (Accounts) Rules, 2014, are annexed herewith at "Annexure-1”

14. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED.

During the year there has been no significant or material orders passed or ordered.

15. CORPORATE SOCIAL RESPONSIBILITY

Pursuant to provisions of Section 135 of the Companies Act, 2013, every company having a net worth of Rupees Five Hundred Crore (Rs.500 Crore) or more; or Turnover of Rupees One Thousand Crore (Rs.1000 Crore) or more; or Net Profit is Rupees Five Crore (Rs.5 Crore) or more during the immediately preceding financial year, is required to constitute a Corporate Social Responsibility Committee (“CSR Committee”) of the Board. Meanwhile this provision is not applicable to your company, as during the immediately preceding financial year, as the company does not fulfill any of the criteria prescribed under section 135.

However, upto the approval of this report the provisions of Section 135 become applicable in the current Financial Year 2023-24 due in increase in profits of the company.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors:

The Board of the Company was duly constituted in accordance with the provisions of the Companies Act, 2013. The company has the following composition of Directors on its Board:

*Ms. Aarti Arora & Mr. Dhikash, Independent Non-Executive Directors were appointed by the Board in its Board Meeting held on 06.06.2022 as the Additional Directors of the Company and the appointment was confirmed by the members in the 1^st Annual General Meeting.

**Mr. Rajesh Gupta, Non-Executive Director was initially appointed by the board meeting as the Additional Director of the Company, then he was re-classified as the Independent Non-Executive Director in the 1^st Annual General Meeting.

Mr. Kanav Gupta (DIN: 06802701) retires by rotation and being eligible, offers himself for reappointment. A resolution seeking shareholders' approval for his re-appointment along with other required details forms part of the Notice.

17. CHIEF FINANCIAL OFFICER:

During the year under review, there is no change in the CFO and Mr. Kanav Gupta, WholeTime Director, continued to act as the Chief Financial Officer (CFO) of the company w.e.f. 28^th July, 2021.

18. COMPANY SECRETARY & COMPLIANCE OFFICER:

During the year under review, the Company had appointed Ms. Nisha Shaw as the Company Secretary and compliance Officer w.e.f. 29^th September 2022. However, upto the date of approval of this report, Ms. Nisha tendered her resignation from the position of Company Secretary & Compliance Officer of the Company w.e.f. 16^th May 2023, which was duly taken note by the Board. The board appointed Ms. Bhagyashree Periwal, as the Company Secretary & Compliance Officer w.e.f. 17^th May 2023.

19. DECLARATION BY THE INDEPENDENT DIRECTOR

Every Independent Director, at the first meeting of the Board in which he/ she participates as a Director and thereafter at the first meeting of the Board in every financial year, gives a declaration that he / she meets the criteria of independence as provided under the law and that he / she is not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact his / her ability to discharge his / her duties with an objective independent judgement and without any external influence.

In the opinion of the Board, the Independent Directors fulfil the conditions specified in the Act and are independent of the management

20. PERFORMANCE EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act.

The performance of the board was evaluated by the Board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.

In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

At the board meeting that followed the meeting of the independent directors and meeting of Nomination and Remuneration Committee, the performance of the Board, its Committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated.

21. NUMBER OF MEETINGS OF THE BOARD

During the year the Board of Directors duly met Eleven (11) times on 12^th April 2022; 6^th June 2022; 31^st August 2022; 23^rd September 2022; 12^th October 2022; 27^th October 2022; 10^th November 2022, 22^nd November 2022; 16^th December 2022; 30^th January 2023 and 10^th March 2023.

In respect of which notices were given and the proceedings were recorded and signed. The intervening gap between any two meetings did not exceed one hundred and twenty days.

22. COMMITTEES OF THE BOARD AND THEIR MEETINGS

During the reporting period the company has constituted the following Board Committees details of which are as follows:

(i) Audit Committee:Extract of terms of reference:

The Committee is constituted in line with the provisions of Section 177 of the Act.

a) Oversight of financial reporting process.

b) Reviewing with the management, the annual financial statements and auditors' report there on before submission to the Board for approval.

c) Evaluation of internal financial controls and risk management systems.

d) Recommendation for appointment, remuneration and terms of appointment of auditors of the Company.

Category & Composition:

The committee was duly constituted on 06^th June, 2022:

Meetings:

During the Financial Year under review, four meeting of committee was held on 31^st August 2022, 12^th October 2022, 10^th November 2022 and 1^st March 2023.

(ii) Nomination and Remuneration Committee (NRC):

Extract of terms of reference:

The Committee is constituted in line with the provisions of Section 178 of the Act.

a) Recommend to the Board the setup and composition of the Board and its Committees.

b) Recommend to the Board the appointment/re-appointment of Directors and Key Managerial Personnel(s).

c) Support the Board and Independent Directors in evaluation of the performance of the Board, its Committees and individual Directors.

d) Recommend to the Board the Remuneration Policy for Directors, executive team or Key Managerial Personnel as well as the rest of employees.

e) Oversee familiarization programs for Directors. Category & Composition:

The committee was duly constituted on 06^th Tune, 2022:

Meetings:

During the Financial Year under review, four meeting of committee was held on 31^st August 2022, 23^rd September 2022, 10^th November 2022 and 1^st March 2023.

(iii) Stakeholders' Relationship Committee("SRC”)

Extract of terms of reference:

The Committee is constituted in line with the provisions of Section 178 of the Act.

a) Consider and resolve the grievances of security holders.

b) Consider and approve issue of share certificates, transfer and transmission of securities, etc.

Category & Composition:

The committee was duly constituted on 06 June, 2022:

Meetings:

During the Financial Year under review, two meeting of committee was held on 10 ^th November 2022 and 1^st March 2023.

23. CORPORATE GOVERNANCE

Your Company provides utmost importance to best Governance Practices and is designated to act in the best interest of its Stakeholders. Better Governance practice enables the

company to introduce more effective internal controls suitable to the changing nature of business operations, improve performance and also provide an opportunity to increase Stakeholders' understanding of the key activities and policies of the organisation.

Pursuant to Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company is not required to mandatorily comply with the provisions of certain regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 being a company listed on the SME platform. Since your Company is listed on the SME platform of National Stock Exchange of India Limited, it is not required to file the Corporate Governance Report to the Stock Exchange and hence, it has not provided the Corporate Governance Report as part of this Annual Report.

24. RISK MANAGEMENT

The Company has put in place the Risk Management System(“RMS”) as a part of its transformation agenda. RMS incorporates an integrated framework for managing risks and internal controls. The internal financial controls have been documented, embedded and digitised in the business processes. Internal controls are regularly tested for design, implementation and operating effectiveness. RMS is enabled through extensive use of technology to support the risk management processes, ensure the ongoing effectiveness of internal controls in processes, compliance with applicable laws and regulations.

The Compliance Function ensures compliance activities related to the Financial, Operational and People Management Systems of the various group entities. This includes various statutes such as industrial and labour laws, taxation laws, corporate and securities laws, health, safety and environmental laws, etc. The ongoing effectiveness of compliance management activities is reviewed independently by the Group Audit Function.

The combination of independent governance, assurance and oversight structures, combined with automated risk management, controls and compliance monitoring, ensures robustness and integrity of financial reporting, management of internal controls and ensures compliance with statutory laws, regulations and company's policies. These provide the foundations that enable optimal use and protection of assets, facilitate the accurate and timely compilation of financial statements and management reports.

25. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

Pursuant to Section 177(9) and (10) of the Companies Act, 2013, the Company has formulated Whistle Blower Policy for vigil mechanism of Directors and employees. The mechanism provides for adequate safeguards against victimization of employees and Directors who use such mechanism and makes provision for direct access to the chairman of the Audit Committee in exceptional cases. The company believes in honesty, integrity, ethics, transparency and good conduct in its professional environment and provides such kind of environment to its employees and directors and always encourages its team to follow such standards in their activities. The directors, employees and other team members are free to report on the issues which require genuine concern. Audit Committee of the Board of directors has the responsibility to review the functioning of vigil mechanism and the same has been performed by the committee periodically.

26. DIRECTORS' RESPONSIBILITY STATEMENT

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

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

b) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

c) They 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;

d) They have prepared the annual accounts on a going concern basis.

e) they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;

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

27. DETAILS OF SUBSIDIARY/IOINT VENTURE/ ASSOCIATE COMPANIES:

The Company does not have any Subsidiary/ Joint Venture/ Associate Companies. There is no requirement of description of the performance of Subsidiaries and Joint Venture Companies.

28. PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS:

During the year under review the company has not given any loan, investment made, guarantees given and security provided under section 186 of the Companies Act, 2013. However, relevant disclosures, if any, are provided in the notes to financial statement.

29. HUMAN RESOURCES

The Management has a healthy relationship with the officers and the Employees.

30. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis report has been separately furnished in the Annual Report and forms a part of the Annual Report is annexed as Annexure-2.

31. PARTICULARS OF EMPLOYEES AND REMUNERATION

In terms of the provisions of Section197(12) of the Act read with Rules5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules is annexed in as Annexure-3.

32. SEXUAL HARRASEMENT

In accordance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition& Redressal) Act, 2013 (“POSH Act”) along with the Rules made there under, the Company has in place a policy which mandates no tolerance against any conduct amounting to sexual harassment of women at workplace.

The Company has constituted Internal Committee(s) (“ICs”) to redress and resolve any complaints arising under the POSH Act. Training / awareness programs are conducted throughout the year to create sensitivity towards ensuring respectable workplace.

The Company is committed to provide a work environment which ensures that every employee is treated with dignity, respect and afforded equal treatment. No complaint was reported during the year under review.

33. DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS

During the year, no such settlement was taking place.

34. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES.

Related party transactions entered during the financial year under review are disclosed in the Financial Statements of the Company for the financial year ended March 31, 2023 as required under Accounting Standard-18. These transactions entered were at an arm's

length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the details of contracts and arrangements with related parties is enclosed herewith as Annexure-4 as per applicable provisions of the Companies Act, 2013.

35. SECRETARIAL STANDARDS

Your Company complies with the Secretarial Standard on Meetings of Directors (SS-1) and Secretarial Standard on General Meetings (SS-2) whenever it has applicable. Your Company will comply with the other Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI)as and when they are made mandatory.

36. CODE OF CONDUCT

The Company has in place a comprehensive Code of Conduct and Our Code (the Codes) applicable to the Directors and employees. The Codes give guidance and support needed for ethical conduct of business and compliance of law.

The Codes reflect the core values of the Company viz. Customer Value, Ownership Mindset, Respect, Integrity, One Team and Excellence. A copy of the Code of Conduct and Our Code are available on the website of the Company at www.deneerstools.com.The Codes have been circulated to the Directors and Senior Management Personnel and its compliance is affirmed by them annually.

37. DETAILS OF APPLICATION / ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Neither any application was made nor any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the financial year.

38. WEBSITE OF THE COMPANY

Your Company maintains a website www.deneerstools.com where detailed information of the Company and specified details in terms of the Companies Act, 2013 has been provided.

39. POLICY FOR PRESERVATION OF DOCUMENTS:

Pursuant to the Regulation 9 of SEBI (LODR), 2015 the Company has maintained the policy of preservation of documents to keep the documents preserve as per Regulation 9(a) & 9(b) of SEBI (LODR), 2015 and the same has been uploaded on the website of the Company on www.deneerstools.com.

40. ACKNOWLEDGEMENT

The Board of Directors wish to place on record its deep sense of appreciation for the committed services by all the employees of the Company. The Board of Directors would also like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, government and regulatory authorities, stock exchanges, customers, vendors, members, debenture holders and debenture trustee during the year under review. And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always placed on us.