to the Members

Your Directors are pleased to present the 66th Annual Report of Duroply Industries Limited along with the Audited Financial Statements for the financial year ended March 31, 2023.

FINANCIAL HIGHLIGHTS (Rupees in Lakhs)

During the year under review, the Company has achieved a turnover of Rs. 302.34 Crores as against Rs. 190.83 Crores in the preceding financial year, an increase of 58.43. Profit before Tax is Rs. 7.92 crores as against a loss of Rs. 4.52 crores in the preceding year. Profit after Tax is Rs. 5.23 crores as against a loss of Rs. 6.31 crores in the preceding year.

During the year under review, the Directors regret their inability to recommend any dividend for the financial year ended March 31, 2023.

No amount has been proposed to be transferred to the General Reserve for the financial year ended March 31, 2023.

The paid up Equity Share Capital as on March 31, 2023 was Rs. 7.77 Crores.

During the year under review, the Board of Directors of the Company vide its meeting held on July 13, 2022, approved the proposal for raising of funds by way of issue, offer and allotment of upto 10,33,968 equity shares of Rs. 10/- each ("Equity Shares") for cash at a price of Rs. 126/- (including a premium of Rs. 116/-) per Equity Share and upto 11,91,032 warrants, each convertible into, or exchangeable for, 1 fully paid-up equity share of the Company of face value of Rs. 10/- each ("Warrants") at a price of Rs. 126/- each payable in cash ("Warrants Issue Price"), which may be exercised in one or more tranches during the period commencing from the date of allotment of the Warrants until expiry of 18 months, by way of preferential issue on private placement basis for an aggregate consideration not exceeding Rs. 28,03,50,000/- in terms of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 read with the applicable provisions of the Companies Act, 2013. The Shareholders of the Company have approved the issue of such securities in the Extra-ordinary General Meeting held on August 08, 2022. The allotment of 10,33,968 equity shares and 11,91,032 Warrants on Preferential Basis was approved by the Allotment Committee in their meeting held on September 02, 2022.

The Allotment Committee vide its meeting held on March 25, 2023, considered and approved allotment of 2,78,224 equity shares of face value of Rs. 10/- each fully paid up at

an issue price of Rs. 126/- per share, pursuant to conversion of 2,78,224 warrants allotted to Promoters on preferential allotment basis on September 02, 2022. 9,12,808 Warrants will be converted into equity shares in due course. Further, the fund raised through this preferential issue has been used for the stated purpose to augment the long-term resources of the Company for meeting funding requirements of its business activities, strengthen balance sheet, maintain adequate liquidity, pursue growth opportunities and general corporate and other purposes. There is no deviation in the use of the proceeds.

There was no change in the nature of the business of the Company during the year.

The total borrowings stood at Rs. 4133.34 Lakhs as at March 31, 2023 as against Rs. 5435.14 Lakhs as on March 31, 2022, i.e. a decrease of Rs. 1301.80 Lakhs.

The Company has not accepted any deposits from public during the year and as such, there is no outstanding deposit in terms of Companies (Acceptance of Deposits) Rules, 2014.

The provisions of Section 135 of the Companies Act, 2013 were not applicable to the Company in the financial year 2022-2023. However, the said provisions would be applicable to the Company during the financial year 2023-24 as the Profit of the Company is more than Rs. 5 Crores in the financial year 2022-2023. The Company has adopted a CSR Policy and the same is hosted and is available on the website of the Company i.e. www.duroply.in

As required under Regulation 34(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the "Listing Regulations"), the Management Discussion and Analysis Report is attached herewith as

"Annexure–1".

Mr. Akhilesh Chitlangia (DIN: 03120474), Executive Director and COO of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment in accordance with the provisions of Section 152(6) and other applicable provisions of the Companies Act, 2013.

Appointment of Mr. Akhilesh Chitlangia (DIN: 03120474) as an Additional Director and the Whole-time Director on the Board of the Company designated as Executive Director & Chief Operating Officer for a period of three (3) years with effect from May 30, 2022 and further his appointment was approved by the Shareholders at the Extra-Ordinary General Meeting of the Company held on August 08, 2022.

The Board of Directors at its meeting on August 09, 2022, based on the recommendation of the Nomination and Remuneration Committee has appointed Mr. Vinay Agarwal, as an Additional (Non-Executive Non-Independent) Director of the Company with effect from August 09, 2022. The resolution for his appointment as a Non-Executive Non-Independent Director was approved by the Shareholders at the 65th Annual General Meeting of the Company held on September 28, 2022.

The Board of Directors at its meeting held on May 19, 2023, based on the recommendation of Nomination and Remuneration Committee has appointed Mr. Arun Kumar Singhania (DIN: 00160194) and Mrs Suparna Chakrabortti (DIN: 07090308) as Additional (Non- Executive Independent) Directors of the Company w.e.f. May 19, 2023. The special resolutions for their appointment have been included in the Notice convening 66th AGM for the approval of Members.

Mrs. Sheela Chitlangia (DIN: 00174354), Non-Executive Director has resigned from the Directorship of the Company with effect from May 19, 2023 due to her commitments in other engagements. Your Directors placed on record their appreciation for the valuable contribution made by her during her tenure as Director of the Company.

Appointment of Mrs. Komal Dhruv (ACS: 41850) as Company Secretary & Compliance Officer of the Company with effect from May 30, 2022.Appointment of Mr. Pawan Kumar Verma as Chief Financial Officer of the Company with effect from August 09, 2022.

In terms of Section 2(51) and Section 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the key managerial personnel of the Company are:

• Sudeep Chitlangia, Managing Director

• Akhilesh Chitlangia, Whole-Time Director & Chief Operating Officer

• Pawan Kumar Verma, Chief Financial Officer

• Komal Dhruv, Company Secretary

The Company has received declaration from each of the Independent Directors under Section 149(7) of the Companies Act, 2013 that, they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the fields of finance, people management, strategy, auditing, tax and risk advisory services, banking, financial services, investments and they hold highest standards of integrity.

The Independent Directors of the Company have registered themselves with the Indian Institute of Corporate Affairs, (‘IICA') as required under Rule 6 of Companies (Appointment and Qualification of Directors) Rules, 2014.

During the year under review, five Board Meetings were convened and held. The details of which are given in Corporate Governance Report forming part of this Report. The provisions of the Companies Act, 2013 and the Listing Regulations were adhered to while considering the time gap between two meetings.

Annual evaluation of Board, its performance, Committees and individual Directors pursuant to applicable provisions of the Companies Act, 2013 and applicable regulations of the Listing Regulations, were carried out.

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

The Board and Nomination & Remuneration Committee had evaluated / 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.

The Securities and Exchange Board of India vide circular SEBI /HO /CFD /CMD/ CIR/ 2017/004 dated January 05, 2017, issued a Guidance Note on Board Evaluation about various aspects involved in the Board Evaluation process to benefit all stakeholders. While evaluating the performance, the above guidance note was considered. Performance evaluation of Independent Directors was carried out by the entire board, excluding the Independent Director being evaluated. A meeting of the Independent Director for the FY 2022-23, was held on February 09, 2023, to review the performance of the Non-Independent Directors and performance of the Board as a whole, on the parameters of effectiveness and to assess the quality, quantity and timeliness of the flow of information between the Management and the Board. The same were discussed in the board meeting that followed the meeting of the Independent Directors, at which the performance of the board, its committees, and individual Directors were also discussed. The Directors expressed their satisfaction with the evaluation process.

The information required pursuant to Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of managerial personnel and employees of the company are attached herewith as "Annexure–2".

As on March 31, 2023 the company is not having any associate, subsidiary or joint venture.

All related party transactions that were entered into during the financial year under review were at arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly there is no transaction to be reported in Form AOC-2.

All related party transactions are placed before the Audit Committee for approval. The detail of the policy on Related Party Transactions as approved by the Board of Directors and Audit Committee is available on the Company's website www.duroply.in.

The Company has in place a Vigil Mechanism/Whistle Blower Policy to deal with unethical behavior and to provide a framework to promote responsible and secured reporting of undesired activities. The Vigil Mechanism/ Whistle Blower Policy is available on the website of the Company at www.duroply.in. During the year, no case was reported under this policy.

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

The Company has formulated a policy on director's selection and appointment, payment of remuneration, directors qualifications, positive attributes, independence of directors, selection and appraisal of performance of Key Managerial Personnel and Senior Management and their remuneration and other related matters as applicable under Section 178(3) of the Companies Act, 2013. The Company's Criteria for payment of remuneration to the Non -Executive Directors and Familiarization Programme undertaken for Independent Directors are available on the Company's website www.duroply.in and the Remuneration Policy is separately attached herewith as "Annexure–3".

The Company has a defined risk management framework to identify, assess, monitor and mitigate risks involved in its business. The Company understands that risk evaluation and risk mitigation is an ongoing process within the organization and is fully committed to identify and mitigate the risks in the business. The Company has formulated and implemented a risk management policy in accordance with Listing Regulations, to identify and monitor business risk and assist in measures to control and mitigate such risks. In accordance with the policy, the risk associated with the Company's business is always reviewed by the management team and placed before the Audit Committee. The Audit Committee reviews these risks on periodical basis and ensures that mitigation plans are in place. The Board is briefed about the identified risks and mitigation plans undertaken.

The risk management policy as approved by the Board of Directors is available on the Company's website www. duroply.in.

The Company has adequate internal control procedures commensurate with its size and nature of business. The objective of these procedures is to ensure efficient use and protection of the Company's resources, accuracy in financial reporting and due compliance of statutes and corporate policies and procedures. The Internal Financial Control (IFC) system ensures recording and providing reliable financial and operational information, compliance with applicable laws, safeguarding of assets from unauthorized use, executing transactions with proper authorization and compliance with corporate policies. The Board of Directors of the Company is responsible for ensuring that Internal Financial Controls have been laid down by the Company and that such controls are adequate and operating effectively.

Necessary certification by the Statutory Auditors in relation to Internal Financial Control u/s 143(3) (i) of the Companies Act, 2013 forms part of the Audit Report.

DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed: (i) That in the preparation of the accounts for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; (ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit/loss of the Company for the year on that date; (iii)That the 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) That the Directors have prepared the accounts for the year ended March 31, 2023 on a ‘going concern' basis. (v) That the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively.

(vi) That the Directors incorporated proper systems to ensure compliance with the provisions of all applicable laws was in place and were adequate and operating effectively.

The Company has in place the SEBI guidelines pertaining to Corporate Governance. The Corporate Governance Report giving the details as required under the Listing Regulations is given separately as "Annexure–4". The Corporate Governance Certificate for the financial year ended on March 31, 2023 issued by CA Vivek Agarwal, partner of M/s S K Agrawal and Co Chartered Accountants LLP, Chartered Accountants, Statutory Auditors of the Company, is also attached herewith as "Annexure–5". Certificate Pursuant to Regulation 17(8) of the Listing Regulations is attached herewith as "Annexure–6".

The Board has seven Committees out of which three have been mandatorily constituted in compliance with the requirements of Companies Act, 2013 and the Listing Regulations while four non-mandatory Committees have been constituted to assist it in the management of the day-to-day affairs of the Company and to increase the efficacy of governance. The Board has adopted charters setting forth the roles and responsibilities of each of the Committees. The Board has constituted following Committees to deal with matters and to monitor activities falling within their respective terms of reference:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Investor Committee

• Borrowing Committee

• Allotment Committee

• CSR Committee

Details of composition of the above Committees, their terms of reference, number of meetings held during the year, attendance therein and other related aspects are provided in the Corporate Governance Report forming part of the Annual Report. There has been no instance where the Board has not accepted the recommendations of its Committees.

The statutory auditors of your Company namely, M/s. S K Agrawal and Co Chartered Accountants LLP, Chartered Accountants, (Firm Registration No. 306033E/E300272) (Formerly known as : M/s. S K Agrawal & Co.) were appointed for a period of five years at the Annual General

Meeting held on September 28, 2022. The statutory auditor confirmed their eligibility and submitted the certificate in writing that they are not disqualified to hold the office of the statutory auditors.

The report of the Statutory Auditor forms part of the Annual Report 2022-23. The said report does not contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the Auditors did not report any matter of fraud under Section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Companies Act, 2013.

Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Mr. Sumantra Sinha, Practicing Company Secretary (ACS: 11247), was appointed to conduct the Secretarial Audit for the Financial Year 2022-23. The Secretarial Audit report for the financial year ended March 31, 2023 is attached herewith as "Annexure-7". The said report does not contain any reservation, qualification or adverse remark. Based on the consent received and on recommendation of the Audit Committee, the Board has re-appointed Mr. Sumantra Sinha, Practicing Company Secretary as the secretarial auditor for the financial year 2023-2024.

During the year under review Cost Audit is not applicable to the Company.

The provisions of Section 125(2) of the Companies Act, 2013 is not applicable for the Company as no dividend was declared in the last financial year.

STOCK EXCHANGE LISTING

The Equity Shares of the Company are listed at the BSE Limited. The Company confirms that the annual listing fees has been paid to the BSE Limited for the financial year 2023-2024.

The information pertaining to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in "Annexure–8" attached herewith.

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return as on March 31, 2023 is available at the web link: https://www.duroply.in/siteassets/pdf/Form_MGT_7_ Draft.pdf.

There were no material changes and commitment affecting the financial position of the Company since the close of the financial year i.e. March 31, 2023 till the date of this Report.

There were no significant and material order passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

An application filed in the financial year 2021-22 against the Company under Insolvency and Bankruptcy Code, 2016 has been disposed off by the Hon'ble National Company Law Tribunal, Kolkata Bench via order dated June 17, 2022.

During the year under review, no settlements were made by the Company with any Banks or Financial Institutions.

The Company provides a safe and conducive work environment to its employees and has adopted a policy on prevention, prohibition, and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder. Internal Complaints Committees have been constituted to enquire into complaints and to recommend appropriate action, wherever required in compliance with the provisions of the said Act.

During the year under review, no complaint was reported to the Committee.

During the financial year, your Company has complied with applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

The Company's factory at Rajkot, Gujarat have been certified ISO 14001:2015 for Environmental Management Systems Standards.

Your Directors place on record their gratitude to the dealers, agents, suppliers, investors and bankers for their continued support, co-operation and their valuable guidance to the Company and for their trust reposed in the Company's management. Your Directors also place on record their sincere appreciation to employees at all levels for their hard work, dedication and continuous contribution to the Company.