• OPEN AN ACCOUNT
Indian Indices
Nifty
22,123.65 118.95
(0.54%)
Sensex
73,936.29 939.98
( 1.29%)
Bank Nifty
46,785.95 185.75
( 0.40%)
Nifty IT
34,744.35 -224.75
( -0.64%)
Global Indices
Nasdaq
16,399.52 83.82
(0.51%)
Dow Jones
39,760.08 477.75
(1.22%)
Hang Seng
16,541.42 148.58
(0.91%)
Nikkei 225
40,168.07 -594.66
(-1.46%)
Forex
USD-INR
83.33 -0.11
(-0.13%)
EUR-INR
90.34 0.01
(0.02%)
GBP-INR
105.32 -0.01
(-0.01%)
JPY-INR
0.55 0.00
(-0.18%)

EQUITY - MARKET SCREENER

Butterfly Gandhimathi Appliances Ltd
Industry :  Domestic Appliances
BSE Code
ISIN Demat
Book Value()
517421
INE295F01017
175.4807047
NSE Symbol
P/E(TTM)
Mar.Cap( Cr.)
BUTTERFLY
47.82
1373.09
EPS(TTM)
Face Value()
Div & Yield %
16.06
10
0
 

As on: Mar 28, 2024 03:10 PM

Dear Members,

The Board of Directors are pleased to present the Company's 36th Annual Report on the business and operations of your Company ("the Company" or "Butterfly"), along with the audited financial statements for the financial year ended March 31,2023.

STATE OF THE AFFAIRS OF THE COMPANY

The performance of the businesses are detailed out in the Management Discussion and Analysis Report, which forms part of this Annual Report.

FINANCIAL PERFORMANCE

The Company's financial performance for the year ended March 31,2023 is summarised below:

(H in lakhs)

Particulars Financial Year ended on March 31,2023 Financial Year ended on March 31,2022
Revenue from Operations (Net) 1,05,655.24 95,985.86
Other Income 659.03 194.22
Operating Expenditure 96,003.09 90,383.35
Operating Profit before Depreciation and Finance Cost 9,652.15 5,602.51
Profit before Depreciation, Finance cost and 10,311.18 5,796.73
Exceptional Items
Finance Cost 650.59 1,113.44
Depreciation 1,615.26 1,546.49
Profit before Exceptional Items and Tax 8,045.33 3,136.80
Exceptional Items - 660.48
Profit before Tax 8,045.33 2,476.32
Income Tax/Deferred Tax 2,878,75 863.64
Profit after Tax 5,166.58 1,612.68
Other Comprehensive Income net of tax (102.89) 24.84
Total Comprehensive Income for the year 5,063.69 1,637.52
Earnings Per Equity Share (Face Value of H10 each) 28.90 9.02

PERFORMANCE AT A GLANCE

During the year under review, the Revenue from operations amounted to H1,05,655.24 lakhs as against H95,985.86 lakhs in the previous year.

EBITDA for the year stood at H10,311.18 lakhs as against H5,796.73 lakhs during the previous year.

Depreciation for the year stood at H1,615.26 lakhs as against H1,546.49 lakhs recognized during the previous year.

Interest expense for the year stood at H650.59 lakhs as against the previous year of H1,113.44 lakhs.

Profit before Tax was H8,045.33 lakhs compared to H2,476.32 lakhs, during the previous year.

No material changes or commitments have occurred between the end of the financial year and the date of this Report, which affect the Financial Statements of the Company with respect to the reporting year.

BUSINESS PERFORMANCE/ STATE OF THE COMPANY'S AFFAIRS

Various initiatives were taken to expand the market for Company's products to new geographies, and for maximisation of efficiencies particularly in the area of cost reduction and working capital management.

The business contingency plans focussed on digitalization of sales process, innovative marketing strategies and careful optimisation of supplies to various channels as and when each channel became operational.

DIVIDEND

The Board has not recommended any dividend for the Financial Year 2022-23.

Your Company has formulated a Dividend Distribution Policy in compliance with Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 as amended ("the Listing Regulations"). The policy is given as Annexure-1 to this Report. This is also available on the Company's website and can be accessed at: https://www.butterflyindia.com/wp-content/ uploads/2021/04/Dividend-Distribution-Policv-20.10.2020.pdf

TRASNFER TO RESERVES

Your Company does not propose to transfer any amount to the General Reserve.

MANAGEMENT DISCUSSION AND ANALYSIS

As required under Regulation 34 read with Schedule V(B) the Listing Regulations, report on Management Discussion and Analysis is presented in a separate section, forming part of this Annual Report and are restricted to the areas which are relevant to the current scenario of the Company and outlook.

SHARE CAPITAL

During the year under review, there was no change in the Share Capital of the Company.

The total paid-up share capital of the Company as on March 31, 2023 stood at H1,787.96 lakhs divided into 1,78,79,551 equity shares of H10.00 (Rupees Ten) each.

FINANCIAL LIQUIDITY

Cash and Cash equivalent as on March 31, 2023 stood at H3,268.84 lakhs vis-a-vis H120.48 lakhs in the previous year. The Company's working capital management is robust and involves a well-organize process, which facilitates continuous monitoring and control over receivables, inventories and other parameters.

CREDIT RATING

CRISIL, a credit rating agency has provided the Company's credit rating for its bank facilities. The details of the ratings are as follows:

Long Term Rating CRISIL AA/ Watch Positive
Short Term Rating CRISIL A1 +

PUBLIC DEPOSITS

No public deposits have been accepted or renewed by your Company during the financial year under review pursuant to the provisions of Section 73 and 74 of the Act read together with the Companies (Acceptance of Deposits) Rules, 2014. Hence, the requirement for furnishing of details relating to deposits covered under Chapter V of the Act or the details of deposits which are not in compliance with the Chapter V of the Act is not applicable.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, the Company has not granted any Loans and/or given any Guarantees and/or provided any security and/or made any investments under the provisions of section 186 of the Companies Act, 2013 ("the Act") read with Companies (Meetings of Board and its Powers) Rules, 2014.

INTERNAL CONTROL SYSTEMS

Your Company has in place, an adequate system of internal controls commensurate with its size, requirements and the nature of operations. These systems are designed keeping in view the nature of activities carried out at each location and the various business operations. The Company has documented a robust and comprehensive internal control system for all the major processes to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedures, laws and regulations, safeguarding of assets and economical and efficient use of resources.

The Internal Auditors monitors and evaluates the efficacy and adequacy of internal controls system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit, process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, the Audit Committee met regularly to review the reports submitted by the Internal Auditors. All audit observations and follow-up actions thereon were reported to the Audit Committee. The Audit Committee has also taken the views of Company's Statutory Auditors on the financial reporting system, compliance to accounting policies and procedures, the adequacy and effectiveness of the internal controls and systems followed by the Company.

Your Company also has a Risk Management Framework in place covering all critical areas of operation. This framework is reviewed periodically keeping in mind the business dynamics and external environment and provides the guidelines for managing the various risks across the business.

VIGIL MECHANISM/ WHISTLE-BLOWER POLICY ("WB Policy")

Over the years, the Company has established a reputation for doing business with integrity and maintained zero tolerance towards any form of unethical behavior. Your Company has formulated a Vigil Mechanism and WB Policy intending to provide a mechanism for employees to report violations. The Audit Committee oversees the functioning of this policy. Protected disclosures can be made by a whistle-blower through several channels to report actual or suspected frauds and violation of the Company's Code of Conduct

The Company has established vigil mechanism for Directors and employees to report genuine concerns pursuant to section 177(9) and (10) of the Act and Regulation 22 of the Listing Regulations.

The Vigil Mechanism Policy of the Company also incorporates a WB Policy in terms of the Listing Regulations. The aggrieved person shall have direct access to the Chairman of the

Audit Committee of the Company. The Company's WB Policy is available on the Company's website and can be accessed at: https://www.butterflyindia.com/wp-content/uploads/2022/09/Whistle-Blower-Policy_28092022.pdf

During the year under review, your Company did not receive any complaints.

HOLDING COMPANY

Pursuant to Section 2(87)(ii) of the Act, Crompton Greaves Consumer Electricals Limited ("CGCEL") is the Holding Company. CGCEL holds 75% of the equity share capital of the Company.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The Company does not have any Subsidiaries, Associates or Joint Venture during the financial year or at any time after the closure of the financial year and till the date of this report.

BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL

Your Company's Board comprises of Ten (10) Members as on the date of this Report.

DIRECTORATE

Appointments/ Re-appointments

The appointment and remuneration of Directors are governed by the Policy devised by the Nomination and Remuneration Committee of your Company. The detailed Nomination and Remuneration Policy is contained in the Corporate Governance Section of this Annual Report.

Mr. Shantanu Khosla (DIN:00059877) was appointed as an Additional Director by the Board on the recommendation of Nomination and Remuneration Committee ("N&RC") w.e.f. March 30, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Mr. Shantanu Khosla as NonExecutive, Non-Independent Director of the Company liable to retire by rotation.

Mr. Mathew Job (DIN:02922413) was appointed as an Additional Director by the Board on the recommendation of N&RC w.e.f. March 30, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Mr. Mathew Job as Non-Executive, Non-Independent Director of the Company liable to retire by rotation.

Mr. Rangarajan Sriram (DIN:09550640) was appointed as an Additional Director designated as the Managing Director by the Board on the recommendation of N&RC w.e.f. March 30, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Mr. Rangarajan Sriram as Managing Director of the Company for a period of Two (2) years w.e.f. March 30, 2022.

Mr. P. M. Murty (DIN:00011179) was appointed as an Additional Independent Director by the Board on the recommendation of N&RC w.e.f. April 1, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Mr. P. M. Murty as an Independent Director for a period of Five (5) years w.e.f. April 1,2022.

Mr. P. R. Ramesh (DIN: 01915274) was appointed as an Additional Independent Director by the Board on the recommendation of N&RC w.e.f. April 1, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Mr. P. R. Ramesh as an Independent Director for a period of Five (5) years w.e.f. April 1,2022.

Ms. Smita Anand (DIN: 00059228) was appointed as an Additional Independent Director by the Board on the recommendation of N&RC w.e.f. April 1, 2022. The Members of the Company vide special resolution passed through postal ballot on June 25, 2022 approved the appointment of Ms. Smita Anand as an Independent Director for a period of Five (5) years w.e.f. April 1,2022.

Mr. Promeet Ghosh (DIN:05307658) was appointed as an Additional Director by the Board on the recommendation of N&RC w.e.f. May 12, 2023. The Board of Directors of the Company have also recommended to the Members, the appointment of Mr. Ghosh as Non-Executive Non Independent Director of the Company liable to retire by rotation at the ensuing Annual General Meeting ("AGM").

The N&RC had evaluated the balance of skills, knowledge and experience as required for being eligible for appointment on the Board of the Company and on the basis of such evaluation had prepared a description of the role and capabilities required of an Independent Director and Mr. P. M. Murty, Mr. P. R. Ramesh & Ms. Smita Anand met such capabilities as identified by the Committee.

Cessation

Mr. P. R. Ramesh, Independent Director resigned from the Board of the Company w.e.f. November 9, 2022.

Mr. Mathew Job, Non- Executive, Non-Independent Director resigned from the Board w.e.f April 30, 2023.

The Board express its appreciation for Mr. P. R. Ramesh and Mr. Mathew Job for the valuable guidance and services rendered by them during their tenure as Directors of the Company.

KEY MANAGERIAL PERSONNEL ("KMP")

During the year under review, Ms. Priya Varshinee V. M. Company Secretary & Compliance Officer, resigned w.e.f. February 3, 2023 and Mr. R. Nagarajan, Chief Financial Officer, resigned w.e.f. April 5, 2023.

Mr. Viral Sarvaiya was appointed as the Company Secretary & Compliance Officer and designated as KMP w.e.f March 25, 2023 and Ms. Ananda Shalini was appointed as Chief Financial Officer and designated as KMP w.e.f April 6, 2023.

In accordance with the provisions of Section 2(51) and Section 203 of the Act read with the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, including any statutory modification(s) or re-enactment(s) thereof for the time being in force below are the KMP's of the Company:

1. Mr. Rangarajan Sriram, Managing Director;

2. Ms. Ananda Shalini, Chief Financial Officer and

3. Mr. Viral Sarvaiya, Company Secretary & Compliance Officer

Independent Directors

The Company's Independent Directors have submitted requisite declarations confirming that they continue to meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the the Listing Regulations. The Independent Directors have also confirmed that they have complied with Schedule IV of the Act and the Company's Code of Conduct. The terms and conditions of appointment of the Independent Directors are placed on the website of the Company and can be accessed at: https://www.butterflyindia.com/investor-relations/#policies

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the varied fields and holds high standards of integrity.

All the Independent Directors of the Company have registered themselves with Indian Institute of Corporate Affairs, Manesar ("IICA") for the inclusion of their names in the data bank maintained by IICA. In terms of Section 150 of the Act read with the Companies (Appointment & Qualification of Directors) Rules, 2014 as amended, since all the Independent Directors of the Company have served as Directors for a period of not less than Three (3) years on the Board of listed companies as on the date of inclusion of their names in the database, they are not required to undertake online proficiency self-assessment test conducted by the said Institute.

Mr. P. M. Murty (DIN:00011179), Mr. A. Balasubramanian (DIN:00490921), Ms. Smita Anand (DIN:00059228) Mr. G. S. Samuel (DIN:05284689), Mr. T. R. Srinivasan (DIN:00367302), Ms. Maheshwari Mohan (DIN:07156606) and Mr. M. Padmanabhan (DIN:00101997) are Independent Directors of the Company. The details of the membership of committees and the qualifications and expertise of all the Directors is covered in the Report on Corporate Governance.

During the year under review, the Members of the Company, vide special resolution passed by way of Postal Ballot dated March 2, 2023 approved continuation of directorship of Mr. T.R. Srinivasan (DIN:00367302) & Mr. A. Balasubramanian (DIN:00490921), Non-Executive Independent Directors beyond the age of 75 years till the expiry of their current tenure i.e., July 31,2024.

Non-Independent Directors

As on March 31, 2023, Mr. Shantanu Khosla and Mr. Mathew Job were the Non-Executive Non-Independent Directors.

Mr. Mathew Job had tendered his resignation from the position of Non-Executive Non-Independent Directors on the Board w.e.f. close of business hours of April 30, 2023. The Board had placed on record its appreciation for the valuable guidance and services rendered by him during his tenure as Director of the Company.

The Board of Directors of the Company on May 12, 2023 with the recommendation of N&RC appointed Mr. Promeet Ghosh (DIN:05307658) as an Additional Director (Non-Executive Non Independent) on the Board w.e.f. May 12, 2023. Further, the N&RC and Board of Directors of the Company have also recommended to the Members the appointment of Mr. Ghosh as Non-Executive Non-Independent Director at the ensuing AGM.

Mr. Shantanu Khosla (DIN:00059877), Non-Executive Director is liable to retire by rotation. Mr. Shantanu Khosla being eligible for re-appointment at the ensuing AGM of your Company has offered himself for re-appointment. His details as required under the Listing Regulations are contained in the accompanying notice convening the ensuing AGM of your Company.

BOARD EFFECTIVENESS

Familiarisation Programme for Independent Directors

Your Company has in place a structured induction programme for induction of new Directors as well as other initiatives to update the existing Directors on a continuous basis. The Familiarisation Programme of the Company provides information relating to the Company, operational activities, business model of the Company, geographies in which Company operates, etc. The programme also intends to improve awareness of the Independent Directors on their roles, rights, responsibilities towards the Company. Further, the Familiarization Programme also provides information relating to the financial performance of the Company, budget and control process of the Company.

Evaluation of the Board's Performance

In terms of requirements of the Act read with the Rules issued thereunder and the Listing Regulations, the Board carried out the annual performance evaluation of the Board of Directors as a whole, Committees of the Board and individual Directors. Your Company believes that the process of performance evaluation at the Board level is pivotal to its Board Engagement and Effectiveness. The Policy and criteria for Board Evaluation is duly approved by N&RC. Performance evaluation is facilitated by the Chairman of the Board who is supported by the Chairman of N&RC.

The process of Board Evaluation is conducted through structured questionnaires for the Board as a whole, Committees of the Board and individual Directors.

The parameters for performance evaluation of the Board inter alia includes the composition of the Board, process of appointment to the Board of Directors, common understanding of the roles and responsibilities of the Board Members, timelines for circulating Board papers, content and quality of the information provided to the Board, attention to the Company's long-term strategic issues, evaluating strategic risks, overseeing and guiding acquisitions, strengths of Board Members and their contribution, governance etc.

Some of the performance indicators for the Committees inter alia includes understanding the terms of reference, the effectiveness of discussions at the Committee Meetings, the information provided to the Committee to discharge its duties/ obligations and performance of the Committee, support provided to the Board vis-a-vis its responsibilities.

Performance of individual Directors was evaluated based on parameters such as attendance at the Meeting(s), contribution to Board deliberations, engagement with colleagues on the Board, ability to guide the Company in key matters, knowledge, and understanding of relevant areas, and responsibility towards stakeholders. All the Directors were subject to self-evaluation and peer evaluation.

The performance of the Independent Directors were evaluated taking into account the above factors as well as independent decision-making and non-conflict of interest.

In addition to the questionnaires, detailed one-on-one insighting was carried out by the Chairperson of the N&RC with individual Board Members. A quantitative analysis and Board Effectiveness brief with in-sighting feedback and trends was shared by the Chairperson of the N&RC to all the Board Members. Thereafter, the following process was followed to assimilate and process the feedback:

• A separate Meeting of the Independent Directors was held on March 17, 2023 wherein performance of Non-Independent Directors including the Managing Director ("MD"), Chairman of the Board and of the Board as a whole was evaluated.

• The entire Board discussed the findings of the evaluation with the Independent Directors and also evaluated the performance of the Individual Directors including the MD, the Board as a whole and all Committees of the Board.

• As an outcome of the above process, individual feedback was shared with each Director.

The Board Evaluation discussion was focused on how to make the Board more effective as a collective body in the context of the business and the external environment in which the Company functions. From time to time during the year, the Board was apprised of relevant business issues and related opportunities and risks. The Board discussed various aspects of its functioning and that of its Committees such as structure, composition, Meetings, functions and interaction with management and what needs to be done to further augment the effectiveness of the Board's functioning.

The overall assessment of the Board was that it was functioning as a cohesive body including the Committees of the Board. They were functioning well with periodic reporting by the Committees to the Board on the work done and progress made during the reporting period. The Board also noted that the actions identified in the past questionnaires based evaluations had been acted upon.

During the F.Y. 2022-23, the Company actioned the feedback from the Board evaluation process conducted in the F.Y. 202122.

Remuneration policy and criteria for selection of candidates for appointment as Directors, KMPs and Senior Management

The Company has in place a policy for remuneration of Directors, KMPs and Members of Senior Management as well as a well defined criterion for the selection of candidates for appointment to the said positions, which has been approved by the Board. The Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to the Executive and Non-Executive Directors (by way of sitting fees and commission), KMPs and Members of Senior Management. The criteria for the selection of candidates for the above positions cover various factors and attributes, which are considered by the Nomination & Remuneration Committee and the Board of Directors while selecting candidates. The policy on remuneration of Directors, KMPs and Senior Management is given as an Annexure to Report on Corporate Governance and is also available at the website of the Company and can be accessed at: https://www.butterflyindia.com/wp-content/ uploads/2021/04/policy-for-appointment-and-evaluation-of- BOD-20.10.2020.pdf

NUMBER OF MEETINGS OF THE BOARD & ITS COMMITTEES

Board Meetings

Regular Meetings of the Board and its Committees are held to discuss and decide on various business policies, strategies, financial matters and other businesses. The schedule of the Board/ Committee Meetings to be held in the forthcoming financial year is circulated to the Directors in advance to enable them to plan their schedule for effective participation in the meetings. Due to business exigencies, the Board also approves several proposals by circulation from time to time. Your Board of Directors met Eight (8) times during the financial year 2022-23. The details of the meetings and the attendance of the Directors are mentioned in the Report on Corporate Governance which forms part of this Annual Report.

Board Committees

The Board has established Committees as a matter of good corporate governance practice and as per the requirements of the Act and the Listing Regulations.

The Company has the following Six (6) Board-level Committees, which have been established in compliance with the requirements of the business and relevant provisions of applicable laws and statutes:

1. Audit Committee

2. Nomination & Remuneration Committee ("N&RC")

3. Corporate Social Responsiblity Committee ("CSR Committee")

4. Stakeholder Relationship Committee ("SRC")

5. Share Transfer Committee ("STC")

6. Risk Management Committee ("RMC")

The composition, terms of reference, number of meetings held and business transacted by the Committees are given in the Report on Corporate Governance which forms part of this Annual Report.

The details of Composition of the Mandatory Committees of the Board are as follows:

Audit Committee

The Audit Committee comprises of Six (6) members out of which Five (5) are Independent Directors. The Committee is chaired by Mr. A. Balasubramanian (Independent Director). The other Members of the Committee are Mr. P. M. Murty (Independent Director), Ms. Smita Anand (Independent Director), Mr. M. Padmanabhan (Independent Director), Mr. G. S. Samuel (Independent Director) and Mr. Shantanu Khosla (Non-Executive, Non Independent Director). Details of the role and responsibilities of the Audit Committee, the particulars of Meetings held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report. During the year under review, all the recommendations made by the Audit Committee were accepted by the Board.

Corporate Social Responsibility Committee ("CSR Committee")

The CSR Committee comprises of Seven (7) Members out of which Five (5) are Independent Directors. The Committee is chaired by Mr. Shantanu Khosla (Non Executive, Non Independent Director). The other Members of the Committee are Mr. Rangarajan Sriram (Managing Director), Mr. P. M. Murty (Independent Director), Ms. Smita Anand (Independent Director), Mr. G. S. Samuel (Independent Director) and Ms. Maheshwari Mohan (Independent Director). Details of the roles and responsibilities of the CSR Committee, the particulars of Members held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report.

In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended, the Company has set up CSR Committee and statutory disclosures with respect to the CSR Committee and an Annual Report on CSR Activities forms part of this Report as Annexure-2. The CSR Policy as recommended by the CSR Committee and as approved by the Board is available on the website of the Company and can be accessed at: https:// www.butterflyindia.com/wp-content/uploads/2021/04/CSR- POLICY-20.10.2020.pdf

Nomination & Remuneration Committee ("N&RC"):

The N&RC comprises of Six (6) Members out of which Five (5) Members are Independent Directors. The Committee is chaired by Ms. Smita Anand (Independent Director). The other Members of the Committee are Mr. P. M. Murty (Independent Director), Mr. A. Balasubramanian (Independent Director), Mr. G. S. Samuel (Independent Director), Mr. M. Padmanabhan, (Independent Director) and Mr. Shantanu Khosla (NonExecutive, Non Independent Director). Details of the role and responsibilities of the N&RC, the particulars of Meetings held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report.

During the year under review, all the recommendations made by the N&RC were accepted by the Board.

N&RC is responsible for, inter alia, recommendation and approval of remuneration of the Directors, KMPs and Senior Management. N&RC is also entrusted with the responsibility of framing the criteria for evaluation of the individual Directors, Chairman of the Board, the Board as a whole and its Committees. It also routinely evaluates the working and effectiveness of the Board and manages the succession planning for Board Members and KMPs.

Stakeholders' Relationship Committee ("SRC")

As on March 31,2023, the SRC comprises of Five (5) Members out of which Three (3) Members were Independent Directors. The Committee was chaired by Mr. Mathew Job (Non-Executive NonIndependent Director). The other Members of the Committee were Mr. R. Sriram (Managing Director), Ms. Smita Anand (Independent Director), Mr. M. Padmanabhan (Independent Director) and Mr. T. R. Srinivasan (Independent Director). Details of the roles and responsibilities of the SRC, the particulars of Meetings held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report. During the year under review, all the recommendations made by the SRC were accepted by the Board.

Mr. Mathew Job, Chairman of SRC ceased to be the Member and Chairman of the Committee w.e.f. April 30, 2023 pursuant to his resignation as Director of the Company.

Further, Mr. Promeet Ghosh was appointed as Chairman of SRC w.e.f. May 12, 2023.

As on the date of this report, the SRC comprises of Five (5) members. The Committee is chaired by Mr. Promeet Ghosh (Non-Executive Non-Independent Director).The other Members of the Committee are Mr. R. Sriram (Managing Director), Ms. Smita Anand (Independent Director), Mr. M. Padmanabhan (Independent Director) and Mr. T. R. Srinivasan (Independent Director).

Share Transfer Committee ("STC")

As on March 31,2023, the STC comprises of Five (5) members out of which Three (3) Members are Independent Directors. The Committee was chaired by Mr. Mathew Job (NonExecutive Non-Independent Director). The other Members of the Committee were Mr. R. Sriram (Managing Director), Ms. Smita Anand (Independent Director), Mr. M. Padmanabhan (Independent Director) and Mr. T. R. Srinivasan (Independent Director). Details of the roles and responsibilities of the STC the particulars of meetings held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report.

Mr. Mathew Job, Chairman of STC ceased to be the Member and Chairman of the Committee w.e.f. April 30, 2023 pursuant to his resignation as Director of the Company.

Further Mr. Promeet Ghosh was appointed as Chairman of SRC w.e.f. May 12, 2023.

Stakeholders' Relationship & Share Transfer Committee ("SRC & STC") is responsible for inter alia various aspects of interest of the stakeholders, monitoring the performance of the Registrar and Share Transfer Agent and recommends measures for overall improvement of the quality of investor services as and when the need arises, resolve the grievances of the security holders of the Company including complaints related to transfer/ transmission of shares, non-receipt of annual report, non-receipt of declared dividends and issue of duplicate certificates, etc.

Risk Management Committee ("RMC")

The RMC comprises of Eight (8) Members. The Committee is chaired by Mr. M. Padmanabhan (Independent Director). The other Members of the Committee are Mr. P. M. Murty (Independent Director), Ms. Smita Anand (Independent Director), Mr. G. S. Samuel (Independent Director), Mr. A. Balasubramanian (Independent Director), Ms. Maheshwari Mohan (Independent Director), Mr. R. Sriram (Managing Director) and Mr. Shantanu Khosla (Non-Executive NonIndependent Director). Details of the roles and responsibilities of the RMC, the particulars of meetings held and attendance of the Members at such Meetings are given in the Report on Corporate Governance, which forms part of this Annual Report. During the year under review, all the recommendations made by the RMC were accepted by the Board.

RMC assists the Board in monitoring and reviewing the risk management plan and implementation of the risk management and mitigation framework of the Company. The main objective of the RMC is to assist the Board in fulfilling its corporate governance oversight responsibilities with regard to the identification, evaluation and mitigation of risks including risks related to cyber security.

Risk Management Policy

The Board has formulated the Company's Risk Management Policy identifying the elements of risk that the Company may face, such as strategic, financial, credit, market, liquidity, security, property, legal, regulatory and other risks, pursuant to the provisions of Section 134(3)(n) of the Act, which has been exhibited on the Company's website and can be accessed at: https://www.butterflyindia.com/wp-content/

uploads/2022/04/Risk-Management-Policy.pdf

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

In accordance with the requirements of the Act and the Listing Regulations, your Company has a Policy on Related Party Transactions (RPTs) uploaded on the Company's website and can be accessed at: https://www.butterflyindia.com/investor- relations/#policies

All RPTs transactions are placed before the Audit Committee for review and approval and to the Board for approval, wherever required. Prior omnibus approval of the Audit Committee and the Board is obtained for the transactions which are of a foreseen and repetitive nature. A statement giving details of all RPTs is placed before the Audit Committee for their noting/ approval every quarter.

There were no material significant transactions with related parties during the year as per the last audited financial statements.

Accordingly, the disclosure of transactions entered into with related parties pursuant to the provisions of Section 188(1) of the Act and Rule 8(2) of the Companies (Accounts), Rules 2014 in Form AOC-2 is attached as Annexure-3.

None of the Directors and the KMPs has any pecuniary relationships or transactions vis-a-vis the Company.

All RPTs are mentioned in the notes to the accounts. The Directors draw attention of the Members to the Notes to the financial statements which sets out the disclosure for RPTs.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND ["IEPF"]

During the year under review, there was no transfer of funds to Investor Education and Protection Fund since such transfer was not applicable for the F.Y. 2022-23.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS, STATUTORY AND QUASI-JUDICIAL BODY

No significant or material orders were passed by the Regulators/ Court/ Tribunals/ Statutory and quasi-judicial bodies which impact the going concern and Company's operation in future.

RISK ARISING OUT OF LITIGATION, CLAIMS AND UNCERTAIN TAX POSITIONS

The Company is exposed to a variety of different laws, regulations, positions and interpretations thereof which encompasses direct taxation and legal matters. In the normal course of business, provisions and contingencies may arise due to uncertain tax positions and legal matters.

Based on the nature of matters, the management applies significant judgement when considering evaluation of risk, including how much to provide for the potential exposure of each of the matters. These estimates could change substantially over time as new facts emerge as each matter progresses, hence these are reviewed regularly. For matters where expert opinion is required, the Company involves the best legal counsel.

AUDITORS

a) Statutory Auditors

M/s. ASA & Associates LLP, Chartered Accountants (Firm Registration Number: 009571N/N500006), were appointed as Statutory Auditors of the Company by the shareholders at the 35th Annual General Meeting ("AGM") held on July 14, 2022 to hold office as Statutory Auditors for a second term of Five (5) years, i.e. from conclusion of the 35th AGM till conclusion of the 40th AGM.

The Board of Directors at their meeting held on May 12, 2023 on the recommendation of the Audit Committee approved the remuneration of M/s. ASA & Associates at H22,00,000 (Rupees Twenty Two Lakhs only) for F.Y. 2023-24.

The Auditors' Report for the F.Y. 2022-23 does not contain any reservation, qualification or adverse remark, on the financial statements of the Company. Auditors' Report is self explanatory and therefore, does not require further comments and explanation.

Further, in terms of Section 143 of the Act read with the Companies (Audit and Auditors) Rules, 2014, as amended, notifications/ circulars issued by the Ministry of Corporate Affairs from time to time, no fraud has been reported by the Auditors of the Company where they have reason to believe that an offence involving fraud is being or has been committed against the Company by officers or employees of the Company and therefore no details are required to be disclosed under Section 134(3)(ca) of the Act.

b) Cost Auditors

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014, your Company is required to maintain cost records as specified by the Central Government. Accordingly, the Company has made and maintained such cost accounts and records in the prescribed manner. The records maintained by the Company under Section 148 of the Act are required to be audited by a Cost Accountant.

The Board at its Meeting held on May 12, 2023 based on the recommendation of the Audit Committee, approved the appointment of M/s. S. Mahadevan & Co, Cost Accountants (Firm Registration Number: 000007) as the Cost Auditors of the Company to conduct audit of the cost records of the Company for the F.Y. 2023-24. A remuneration of H1,75,000 (Rupees One Lakh Seventy Five Thousand only) plus applicable taxes and out-of-pocket expenses, has been fixed for the Cost Auditors subject to the ratification of such fees by the Members at the ensuing AGM. Accordingly, the matter relating to the ratification of the remuneration payable to the Cost Auditors for the H1,75,000 2023-24 will be placed at the ensuing AGM. Your Company has received consent and eligibility certificate from M/s. S. Mahadevan & Co.

c) Secretarial Auditors & Secretarial Audit Report

The Board at its meeting held on May 11,2022, appointed M/s. M. Alagar & Associates, Practising Company Secretaries as Secretarial Auditors of the Company to conduct the Secretarial Audit for F.Y. 2022-23. The Secretarial Audit Report is annexed herewith as Annexure-4 to this Report. There has been no qualification, reservation, or adverse remark given by the Secretarial Auditors in their Report.

Pursuant to the provisions of Section 204 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board based on recommendation of the Audit

Committee approved the appointment of M/s. M. Alagar & Associates, Company Secretaries (ICSI Unique Code: P2011TN078800) as Secretarial Auditors to conduct audit of the secretarial records of the Company for the F.Y. 2023-24 at a remuneration of H1,40,000 (One lakh Forty Thousand only).

d) Internal Auditors

Pursuant to the provisions of Section 138 of the Act, the Board, at its meeting held on May 11, 2022 based on the recommendation of the Audit Committee, had approved the appointment of M/s. Grant Thornton Bharat LLP (Identity number AAA-7677) to conduct the internal audit of your Company for the F.Y. 2022-23.

The Board of Directors at their meeting held on May 12, 2023 has re-appointed M/s. Grant Thornton Bharat LLP as the Internal Auditors of your Company for the F.Y. 2023-24 to review various operations of the Company at remuneration of H26,00,000 lakhs (Rupees Twenty Six lakhs only).

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF THE REPORT

There are no material changes and commitments affecting the financial position of your Company, which has occurred between the end of the F.Y. of the Company, i.e. March 31,2023 and the date of this Board Report, i.e. May 12, 2023.

AWARDS AND RECOGNITIONS

The detailed section on awards & recognitions forms part of this Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

Your Company is now moving from Business Responsibility Report ("BRR") to the newly introduced reporting parameters, i.e. Business Responsibility & Sustainability Report ("BRSR"). Your Company is proud to publish its first BRSR for the F.Y. 2022-23. The BRSR would follow the format detailed in the amendment to Regulation 34(2)(f) of the Listing Regulations vide Gazette notification no. SEBI/LAD-NRO/GN/2021/22 dated May 05, 2021 and forms part of this Annual Report.

The BRSR for F.Y. 2022-23 is aligned with the Nine (9) principles of the National Guidelines on Responsible Business Conduct notified by the Ministry of Corporate Affairs, Government of India.

CORPORATE GOVERNANCE

Your Company has been complying with the provisions of Corporate Governance as stipulated under applicable provisions of the Listing Regulations. A separate report on Corporate Governance along with Auditors' Certificate on compliance of the Corporate Governance norms as stipulated in Regulation 34(3) of the Listing Regulations forms part of Annual Report are provided as Annexure-5 to this Board Report.

PARTICULARS OF EMPLOYEES

There are Two (2) employees who were in receipt of remuneration of not less than H1,02,00,000 per annum if employed for the full year or not less than H8,50,000 per month if employed for any part of the year.

The information as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure-6 to this Board's Report.

Details of employee remuneration as required under provisions of Section 197(12) of the Act read with Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available for inspection at the Registered Office of your Company during working hours. The Annual Report and accounts are being sent to the shareholders excluding the aforesaid exhibit. Any Member interested in obtaining such information may write to the Company Secretary & Compliance Officer at the Registered Office of the Company.

REPORTING OF FRAUD BY AUDITORS

During the year under review, neither the Statutory Auditors nor the Secretarial Auditors have reported to the Audit Committee of the Board, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in this Report.

ANNUAL RETURN

As required under Section 92 (3) read along with Section 134(3)

(a) of the Act, the Annual Return of the Company is placed the website of the Company and can be accessed at: www. butterflyindia.com

COMPLIANCE WITH SECRETARIAL STANDARDS ("SS-1 and SS-2")

The Company complies with all applicable secretarial standards issued by the Institute of Company Secretaries of India (ICSI) i.e. SS-1 and SS-2 relating to 'Meetings of the Board of Directors' and 'General Meetings' respectively.

RE-CLASSIFICATION OF PROMOTERS

During the year under review, the Board of Directors of the Company had received request from Mr. V. M. Lakshminarayanan, Mr. V. M. Balasubramaniam, Mr. V. M. Seshadri, Mr. V. M. Gangadharam, Mr. V. M. Kumaresan, Mr. V. M. L. Karthikeyan, Mr. V. M. L. Senthilnathan, Mr. V. M. S. Namasivayam, Mr. V. M. S. Kumaraguru, Mrs. A. Gandhimathi, Mr. Gangadharam Viswanathan, Mr. V. M. G. Mayuresan, Mrs. V. M. L. Shenbagalakshmi, Mrs. V. M. B. Unnamalai, Mrs. V. M. S. Karpagam, Mrs. V. M. G. Sivakami, Mrs. V. M. K. Mangalam, V. M. Chettiar and Sons India LLP and LLM Appliances Private Limited belonging to promoter / members of promoter group of the Company vide their letter dated August 17, 2022, for reclassifying their shareholding in the Company from the "Promoter and Promoter group" category to the "public" shareholder category, in accordance with applicable Listing Regulations as amended and rules, regulations and guidelines as applicable in this regard.

Pursuant to the same, an application in terms of Regulation 31A of the Listing Regulations was made to the stock exchanges for their approval for the reclassification.

The Company has received the approval from National Stock Exchange of India Limited and BSE Limited, on January 3, 2023 for reclassification of the said Members of Promoter and Promoter Group to Public Shareholders.

OPEN OFFER AND MINIMUM PUBLIC SHAREHOLDING COMPLIANCE

An Open Offer was made by Crompton Greaves Consumer Electricals Limited ("the Holding Company/ Crompton") to the Public Shareholders of the Company in accordance with Regulation 3(1) and Regulation 4 of the SEBI (Substantial Acquisition of Shares & Takeover) Regulations, 2011 for acquisition of up to 46,48,684 fully paid-up equity shares of face value of H10.00 (Rupees Ten only) each of the Company, representing 26% of the voting rights of the Company from the Public Shareholders at a price of H1,433.90 (Rupees One Thousand Four Hundred Thirty Three and Ninety Paise only). The open offer was fully subscribed and subsequently 81% of equity share capital of the Company was held by the Holding Company.

MINIMUM PUBLIC SHAREHOLDING COMPLIANCE

Crompton, sold 10,72,775 equity shares of the Company constituting 6% of the total paid-up capital of the Company to the public in accordance with the "Comprehensive Guidelines on Offer for Sale ("OFS") of Shares by Promoters through the Stock Exchange Mechanism" issued by the Securities and Exchange Board of India on February 14, 2020 and February 17, 2020, respectively.

Consequently, the Company is now compliant with the Minimum Public Shareholding requirements as mandated under Rules 19(2)(b) and 19A of the Securities Contracts (Regulation) Rules, 1957 read with Regulation 38 of the Listing Regulations.

The breakup of Promoter and Public Shareholding of the Company post aforesaid sale of shares is provided below:

Category No of equity shares % of total paid- up share capital
Promoter and Promoter Group 1,34,09,663 75.00
Public 44,69,888 25.00
Non-Promoter Non Public Nil Nil
Total 1,78,79,551 100.00

MERGERS AND ACQUISITIONS

During the year under review, the Board of Directors of the Company ("the Board") at its meeting held on March 25, 2023, considered and approved the Scheme of Amalgamation of the Company, ("Transferor Company") with Crompton Greaves Consumer Electricals Limited ("Transferee Company") and their respective shareholders and creditors under Sections 230 to 232 and other applicable provisions of the Act read with rules made thereunder ("Scheme").

It is intended to merge the Company with Crompton Greaves Consumer Electricals Limited, with the rationale of further leveraging & utilizing the strengths of both the entities, accelerating the realization of identified synergies, bringing in integrated and coordinated business approach, and improving organizational capability.

The Board of both the entities have approved the proposed transaction on March 25 2023, which is subject to regulatory approvals. Pursuant to the proposed Scheme, the Transferee Company shall issue equity shares to the shareholders of the Transferor Company (other than the Transferee Company) in accordance with the Share Swap Ratio as determined by the registered valuers and as approved by the Board.The Scheme is subject to the receipt of necessary statutory and regulatory approvals including approval of Stock Exchanges, the Securities and Exchange Board of India, the respective shareholders and creditors of respective companies and National Company Law Tribunal(s) (Mumbai & Chennai Benches). Further, the Company has filed the said Scheme of Amalgamation with BSE Ltd. and National Stock Exchange of India Limited on April 7, 2023.

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION AND FOREIGN EXCHANGE OUTGO

Information relating to energy conservation, technology absorption, foreign exchange earned and spent, and research and development activities undertaken by the Company in accordance with Section 134(3)(m) of the Act read with Rule 8(3) of Companies (Accounts) Rules, 2014, are given in Annexure-7 of this Board's Report.

DISCLOSURES PERTAINING TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has formulated a comprehensive policy on prevention, prohibition and redressal against sexual harassment of women at workplace, which is also in accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH"). The said policy has been made available on the website of the Company. The Company has constituted of Internal Complaints Committee ("ICC") under the POSH and has complied with the provision relating to the same. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. The constitution of ICC is as per the POSH Act and includes an external member who is an independent POSH consultant with relevant experience. The POSH Policy is gender inclusive, and the framework ensures complete anonymity and confidentiality. During the year under review, no complaint was received.

SHARE REGISTRAR & TRANSFER AGENT

M/s. GNSA Infotech Private Limited is the RTA of the Company. Their contact details are mentioned in the Corporate Governance Report and same is also available on the website of the Company https://www.butterflyindia.com/investor-relations/

LISTING WITH STOCK EXCHANGES

The equity shares of your Company are listed on The National Stock Exchange of India Limited ("NSE") and BSE Limited ("BSE"). Details of the Company in the Stock Exchanges are as follows:

NSE Symbol BUTTERFLY
BSE Scrip Code 517421
ISIN INE295F01017

Your Company has paid the Annual Listing Fees for the F.Y. 2022-23 and F.Y. 2023-24 to both the NSE and BSE, with whom the equity shares of the Company are listed.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors would like to assure the Members that the Financial Statements for the year under review confirm in their entirety to the requirements of the Act and guidelines issued by SEBI. Pursuant to the provisions of Section 134(3)(c) of the Act, to the best of their knowledge and based on the information and explanations received from the Company, your Directors confirm that:

(a) in the preparation of the annual 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;

(b) the accounting policies selected and applied 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 as at March 31,2023 and of the profit and loss of the Company for that year;

(c) sufficient care has been taken and that adequate accounting records have been maintained for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities;

(d) the annual accounts have been prepared on a going concern basis;

(e) proper internal financial controls laid down by the Directors were followed by the Company and such internal financial controls are adequate and were operating effectively; and

(f) the systems devised to ensure compliance with the provisions of all applicable laws were adequate and operating effectively.

INSIDER TRADING

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended, your Company has instituted a comprehensive Code titled as "Policy on Determination of Legitimate Purpose for Sharing UPSI" which lays down guidelines and advises the Directors and Employees of the Company on procedures to be followed and disclosures to be made while dealing in securities of the Company.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these items during the year under review:

(i) The Company has not resorted to any buy back of the equity shares during the year under review;

(ii) The Company has not issued equity shares with differential rights as to dividend, voting or otherwise;

(iii) The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees;

(iv) The Company has not issued Sweat Equity Shares to the employees of the Company;

(v) There has been no change in the nature of business of the Company as on the date of this report;

(vi) There was no revision in the Financial Statements;

(vii) There were no proceedings, either filed by the Company or filed against the Company, pending under the Insolvency and Bankruptcy Code, 2016 as amended, before National Company Law Tribunal or other courts during the year under review;

(viii) No instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act;

(ix) Disclosure of reason for difference between valuation done at the time of taking loan from bank and at the time of one-time settlement. There was no instance of onetime settlement with any Bank or Financial Institution; and

(x) No fraud has been reported by the Auditors to the Audit Committee or the Board.

RIGHTS OF SHAREHOLDERS

• right to participate in, and to be sufficiently informed of, decisions concerning fundamental corporate changes;

• opportunity to participate effectively and vote in general shareholder Meetings;

• being informed of the rules, including voting procedures that govern general shareholder meetings;

• opportunity to ask questions to the Board of Directors at General Meetings;

• effective shareholder participation in key corporate governance decisions such as election of Members of Board of Directors;

• exercise of ownership rights by all shareholders, including institutional investors;

• adequate mechanism to address the grievances of the shareholders;

• protection of minority shareholders from abusive actions by, or in the interest of, controlling shareholders acting either directly or indirectly, and effective means of redress;

• to receive Dividends and other corporate benefits like rights, bonus etc. once approved;

• to inspect statutory registers and documents, including minutes books of the general meetings, as permitted under law; and

• any other rights as specified in the statutory enactments from time to time.

ACKNOWLEDGEMENT

Your Directors wish to convey their gratitude and appreciation to all the employees of the Company posted at all its locations for their tremendous personal efforts as well as collective dedication and contribution to the Company's performance.

Your Directors would also like to thank the shareholders, customers, dealers, suppliers, bankers, Government and all other business associates, consultants and all the stakeholders for their continued support extended to the Company and the Management.

CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion and Analysis describing the Company's objectives, projections, estimates, expectations or predictions may be 'forward looking statements' within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company's operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in the Company's principal markets, changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labour negotiations. The Company is not obliged to publicly amend, modify or revise any forward-looking statement, on the basis of any subsequent development, information or events or otherwise.

For and on behalf of the Board
For Butterfly Gandhimathi Appliances Limited
P.M. Murty
Place: Chennai Chairman
Date: May 12, 2023 DIN :00011179