Lokesh Machines Limited has formally requested BSE and NSE to waive penalties totaling ₹7.43 lakh imposed for non-compliance with board composition regulations. The company's board addressed the matter in its December 29, 2025 meeting, citing statutory limitations that prevented immediate compliance with exchange requirements.

Penalty Details and Non-Compliance Issue

Both BSE Limited and National Stock Exchange of India Limited imposed fines on November 28, 2025, for the company's failure to comply with Regulation 17(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The regulation pertains to the mandatory composition requirements for the board of directors.

The company promptly informed both exchanges about the non-compliance and penalty levy on November 29, 2025, following the receipt of notices.

Board's Response and Justification

During the December 29, 2025 board meeting, directors deliberated on the non-compliance instance and the consequent exchange penalties. The board emphasized that Lokesh Machines Limited operates under unique regulatory constraints due to its business nature.

The company manufactures small arms and operates under the provisions of the Arms Act, 1959, read with the Arms Rules, 2016. This regulatory framework mandates prior approval from the Ministry of Home Affairs (MHA) for any changes in the company's directorship structure.

Statutory Limitations and MHA Requirements

The board highlighted several key factors that contributed to the temporary non-compliance:

• Mandatory requirement for MHA prior approval for directorship changes
• Compliance with MHA advisories and directions
• Adherence to statutory framework under Arms Act, 1959
• Operational constraints beyond the company's direct control

The board observed that the temporary non-compliance arose solely due to these mandatory MHA approval requirements, which are beyond the company's control and represent statutory obligations that must be fulfilled before making any board composition changes.

Waiver Application and Current Status

Lokesh Machines Limited has submitted waiver applications to both exchanges in accordance with the Policy for Exemption of Fines levied under the SEBI SOP Circular. The applications request relief from the penalties, asking the exchanges to consider the statutory limitations imposed under the Arms Rules, 2016 and MHA advisories.

The board reaffirmed its commitment to maintaining high standards of corporate governance and compliance with all applicable regulatory requirements, while acknowledging the unique operational constraints it faces as a small arms manufacturer.

Lokesh Machines Limited has issued an official postal ballot notice dated December 29, 2025, to the stock exchanges seeking shareholder approval for the regularisation of its recently appointed Independent Director. The company filed the notice with BSE Limited and National Stock Exchange of India Limited under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Postal Ballot Notice Details

The postal ballot seeks approval for the regularisation of Wg Cdr Kolkappadam Vadavatath Sanil Babu (retd) as a Non-Executive Independent Director through a special resolution. The company has engaged National Securities Depository Limited (NSDL) as its agency for providing e-voting facility to members.

E-Voting Timeline and Process

The company has established a comprehensive timeline for the postal ballot process to ensure proper shareholder participation through remote e-voting.

Regulatory Compliance and Documentation

The postal ballot notice has been filed with both BSE Limited (Scrip Code: 532740) and National Stock Exchange of India Limited (Company Code: LOKESHMACH) as required under regulatory guidelines. The notice is also available on the company's website at https://www.lokeshmachines.com/investment-center.php?key=shareholders-meeting for shareholder access.

Director's Background

Wg Cdr Sanil Babu was initially appointed as an additional director during the November 11, 2025 board meeting. He brings extensive experience from his military background with expertise in aerospace & defence operations, production management, strategic planning, plant operations, aviation maintenance, operational excellence, sales and marketing, project management, quality systems, and capability building.

This regularisation process demonstrates Lokesh Machines Limited's commitment to proper corporate governance procedures and ensures that all director appointments receive appropriate shareholder approval as mandated under corporate regulations.