Dear Members,

The Directors of Pranavaditya Spinning Mills Limited ("your Company / the Company") present the 32^nd Annual Report on the business and operations of your Company together with the Audited Financial Statements for the year ended 31^st March, 2022.

Financial Results

(Rs In Lakhs, except EPS)

Due to separation of all workers under VRS/Separation scheme announced by the Company, the production at the Company's factory stopped from August, 2020. Further, the Board of Directors of the Company approved the scheme of amalgamation of the Company with Indo Count Industries Limited, Holding Company and till amalgamation, the Board approved leasing of land, building and machinery to the Holding Company and third parties. Hence, there was no revenue from operations for FY 2021-22 and the total income comprised of lease rentals received from the Holding Company and third parties.

For the year ended 31^st March, 2022, Total Income amounted to Rs 396.34 lakhs and Company achieved Net profit of Rs 72.24 lakhs as compared to loss of Rs 590.86 lakhs in the previous year. The financial results for the year ended 31^st March, 2022 are not comparable with the financial results for the year ended 31^st March, 2021 due to aforementioned reasons.

Amalgamation of the Company with Indo Count Industries Limited, Holding Company

During FY 2021-22, an application was filed with Hon'ble National Company Law Tribunal, Mumbai bench ("NCLT") for the amalgamation of the Company with Indo Count Industries Limited, Holding Company under sections 230-232 of the Companies Act, 2013. Pursuant to the directions given by Hon'ble National Company Law Tribunal (NCLT) vide its order dated 18^th August, 2021, a meeting of the equity shareholders of the Company was held on November 15, 2021 for consideration and approval of the scheme of amalgamation and the resolution for the scheme of amalgamation of the Company was passed with requisite majority. Thereafter, a petition was filed with Hon'ble NCLT and as on the date of this report, petition is yet to be heard.

Upon the Scheme becoming effective, with effect from the appointed date, the Business (along with all assets and liabilities thereof) of the Company shall be transferred and vested with the transferee Company i.e. Indo Count Industries Limited (ICIL) on a going concern basis. As a consideration for the amalgamation, the transferee/ the transferee Company / ICIL will issue its equity shares to the shareholders of the Company/transferor company as on the record date in a share exchange ratio of 2:15 (i.e. 2 (Two) fully paid up equity shares of Rs 2/- each of Indo Count Industries Limited (ICIL) would be issued to the Equity Shareholders of the company, for every 15 (Fifteen) equity shares of Rs 10/- each fully paid up).

Dividend

In order to conserve the resources, the Board of Directors of your Company has not recommended any dividend on the equity shares of the Company for the year ended 31^st March, 2022.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profit for FY 2021-22 in the statement of profit & loss.

Share Capital

There was no change in the capital structure of your Company during the year under review. As on 31^st March, 2022, the issued, subscribed and paid up equity share capital of your Company is Rs 19,24,12,800/- comprising of 1,92,41,280 Equity shares of Face Value of Rs 10/- each. During the financial year 2021-22, your Company has not issued any equity shares with differential rights as to dividends, voting or otherwise, or any convertible securities, warrants or Sweat Equity shares. Your Company does not have any Employee Stock Option Scheme or Employee Stock Purchase Scheme.

Directors and Key Managerial Personnel

During the year under review, there has been no change in the composition of the Board of Directors of the Company.

Pursuant to the provisions of Section 152 of the Companies Act, 2013 ("Act") and articles of association of the Company, Mr. Anil Kumar Jain (DIN: 00086106) Non-Executive Non-Independent Director of the Company, retires by rotation at the ensuing Annual General Meeting ("AGM") and being eligible, has offered himself for the re-appointment. The Board recommends his re-appointment for consideration at the ensuing AGM. As per Secretarial Standard - 2 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), brief profile and other related information of Mr. Anil Kumar Jain, Director retiring by rotation is provided in the Notice of ensuing AGM.

As on 31^st March, 2022, Mr. Ashok G. Halasangi, Chief Executive Officer, Mr. K. Muralidharan, Chief Financial Officer and Mrs. Amruta Avasare, Company Secretary & Compliance Officer are the Key Managerial Personnel (KMP) of the Company in terms of Section 203 of the Companies Act, 2013. There has been no change in KMP during the year under review.

All the Independent Directors of the Company have given declarations that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge duties with an objective independent judgment and without any external influence. The said declarations were taken on record by the Board after assessing due veracity of the same. In the opinion of the Board, all Independent Directors are independent of the management.

Pursuant to Rule 6 of Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of the Company viz. Mr. S. K. Agrawal, Dr. Ashok Desai, Ms. Kala Agarwal and Mr. L. Viswanathan have registered themselves in the Independent Directors databank maintained with the Indian Institute of Corporate Affairs (IICA). Further, all the Independent Directors have also cleared the proficiency test conducted by IICA. In the opinion of the Board of Directors of the Company, all Independent Directors possess high integrity, expertise and experience including the proficiency required to discharge the duties and responsibilities as Directors of the Company.

Number of Board Meetings

During the Financial Year 2021-22, Four (4) Board Meetings were held on 23^rd April, 2021, 23^rd July, 2021, 21^st October, 2021 and 27^th January, 2022 through Video conferencing. More details on Board Meetings are provided in the Corporate Governance Report.

Company's policy on appointment and remuneration of Directors and Key Managerial Personnel

Pursuant to Section 178 of the Companies Act, 2013, the Nomination and Remuneration Committee (NRC) has formulated "Nomination and Remuneration Policy" which deals inter-alia with the appointment and remuneration of Directors, Key Managerial Personnel, Senior Management and other employees. The said policy is uploaded on the website of the Company and web-link thereto is https://www.pranavaditva.com/wp-content/uploads/2019/10/nomination-and-remuneration-policv-1.pdf

The salient features of the policy are as under:

I. Criteria for appointment:

a. NRC shall identify, ascertain and consider the integrity, qualification, expertise and experience of the person for the appointment as a Director of the Company and recommend to the Board his / her appointment. The Directors shall uphold ethical standards of integrity and probity and shall exercise their duties and responsibilities in the interest of the Company.

b. A person proposed to be appointed as Director should possess adequate qualification, expertise and experience for the position he / she is considered for appointment. They shall possess appropriate core skills/ expertise/ competencies/ knowledge in one or more fields of finance, law, management, sales and marketing, administration, research and in the context of business and/or the sector in which the company operates. The NRC has the discretion to decide whether qualifications, expertise and experience possessed by a person are sufficient/ satisfactory for the concerned position.

c. The Company shall comply with the provisions of the Act and Listing Regulations and any other laws if applicable for appointment of Director of the Company. The Company shall ensure that provisions relating to limit of maximum directorships, age, term etc. are complied with.

II. Remuneration of the Whole Time / Executive Director(s) / Managing Director:

a. The remuneration including commission payable to the Whole Time / Executive Director(s) / Managing Director shall be determined and recommended by the NRC to the Board for approval.

b. While determining the remuneration of the Executive Directors, following factors shall be considered by the NRC/ Board:

• Role played by the individual in managing the Company including responding to the challenges faced by the Company

• Individual performance and company performance so that remuneration meets appropriate performance benchmarks

• Reflective of size of the Company, complexity of the sector/ industry/ company's operations and the Company's financial position

• Consistent with recognized best industry practices.

• Peer remuneration

• Remuneration involves balance between fixed and incentive pay reflecting performance objectives appropriate to the working of the Company and its goals.

• Remuneration is reasonable and sufficient to retain and motivate directors to run the company successfully.

III. Remuneration to Non- Executive / Independent Directors:

Sitting Fees: Independent Directors are entitled for sitting fees for attending meetings of the Board or Committee of the Board or for any other purposes as may be decided by the Board, of such sum as may be approved by the Board of Directors of the Company within the overall limits prescribed under the Act and the rules made thereunder, Listing regulations or other applicable law.

Annual Evaluation of Board Performance and its Committee and Individual Directors

Criteria of performance evaluation of the Board, Committees and Directors are laid down by Nomination and Remuneration Committee (NRC) of the Company. Further, pursuant to the provisions of Section 178(2) of the Companies Act, 2013 as amended by the Companies (Amendment) Act, 2017, NRC decided to continue the existing method of performance evaluation through circulation of performance evaluation sheets based on SEBI Guidance Note dated 5^th January, 2017 and that only Board should carry out performance evaluation of the Board, its Committees and Individual Directors.

The performance evaluation sheets based on aforesaid SEBI Guidance Note, containing the parameters of performance evaluation and rating scale was circulated to all the Directors. The Directors rated the performance against each criteria. Thereafter, consolidated score was arrived. Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the Board has carried out performance evaluation of its own, the Board Committee and all Individual Directors in the aforesaid manner. The performance of the Board, committees and individual directors was found satisfactory.

A meeting of the Independent Directors of the Company was held on 27^th January, 2022 in which Independent Directors inter-alia reviewed performance of Non-Executive Independent Chairman and other Non-Independent Directors and the Board and committees as a whole through performance evaluation sheets.

Directors' Responsibility Statement

Pursuant to the provisions of Section 134(3)(c) and 134(5) of the Companies Act, 2013, your Directors, to the best of their knowledge and belief and according to the information and explanations obtained by them, state and confirm that:

• in the preparation of the annual accounts for the year ended 31^st March, 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

• such accounting policies as mentioned in the notes to the Financial Statements for the year ended 31^st March, 2022, have been selected and applied consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2022 and of the profit of the Company for the year ended on that date;

• proper and sufficient care has been taken 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;

• the annual financial statements for the year ended 31^st March, 2022, have been prepared on a going concern basis;

• internal financial controls to be followed by the Company have been laid down and that the said financial controls were adequate and operating effectively;

• proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems were adequate and operating effectively.

Audit Committee

During the year under review, there has been no change in the composition of the Audit committee. As on 31^st March, 2022, the Audit Committee comprises of 4 members viz. Mr. S. K. Agrawal, Independent Director as Chairman, Dr. Ashok Desai, Ms. Kala Agarwal, Independent Directors and Mr. Kamal Mitra, Non-Executive Non-Independent Director. More details on the Audit Committee are given in Corporate Governance Report. All the recommendations made by the Audit Committee during the year under review were accepted by the Board.

Statutory Auditors

In accordance with the provisions of section 139 of the Companies Act, 2013, M/s. Suresh Kumar Mittal & Co., Chartered Accountants (Firm Registration No. 500063N) were appointed as the Statutory Auditors of the Company to hold office for a period of 5 years i.e. from the conclusion of the 27^th Annual General Meeting (AGM) of the Company held on 21^st August, 2017 upto the conclusion of the 32^nd AGM of the Company. Accordingly, the first term of existing statutory auditors is ending on the conclusion of ensuing 32^nd AGM of the Company. However, due to professional pre-occupations, M/s. Suresh Kumar Mittal & Co. have expressed their unwillingness to be re-appointed as the statutory auditors of the Company for a second term at the ensuing Annual General Meeting.

The Board of Directors of the Company places on record its appreciation for the services rendered by M/s. Suresh Kumar Mittal & Co., Chartered Accountants as the Statutory Auditors of the Company.

Pursuant to the recommendation of the Audit Committee, the Board of Directors of the Company at their meeting held on 28^th April, 2022 proposed and recommended to the members of the Company, appointment of M/s. JLN US & Co., Chartered Accountants (Firm Registration Number: 101543W) as the Statutory Auditors of the Company to hold office for a period of five consecutive years from the conclusion of 32^nd Annual General Meeting of the Company till the conclusion of 37^th Annual General Meeting of the Company, in place of existing statutory Auditors. The Company has also received written consent and eligibility certificate from M/s. JLN US & Co., Chartered Accountants under Section 141 of the Act. M/s. JLN US & Co. also holds peer review certificate issued by the Institute of Chartered Accountants of India. The resolution for the appointment of M/s. JLN US & Co, Chartered Accountants, as statutory auditors of the Company has been placed at the ensuing AGM for approval of members of the Company.

Auditors' Report

The Auditors' Report on the audited standalone financial statements of the Company for the year ended 31^st March, 2022 issued by M/s. Suresh Kumar Mittal and Co., Statutory Auditors of the Company forms part of this Annual Report. The Auditors' Report does not contain any qualifications, reservations, adverse remarks or disclaimer. In terms of the provisions of Section 143(12) of the Act, no frauds have been reported by the Statutory Auditors in their report for the year under review. Notes to the Financial Statements are self-explanatory and do not call for any further comments.

Secretarial Auditors and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Act, read with rules thereunder, the Board at its meeting held on 27^th January, 2022 had appointed M/s. Kothari H. & Associates, Practicing Company Secretaries as Secretarial Auditors to conduct the Secretarial Audit of the Company for the year ended 31^st March, 2022. The Secretarial Audit Report issued by the Secretarial Auditors in Form No. MR-3 is provided as an "Annexure 1" to this Report. The Secretarial Audit Report does not contain any qualifications, reservations or adverse remarks.

Further, in terms of the provisions of Regulation 24A of the Listing Regulations, M/s. Kothari H. & Associates, Practicing Company Secretaries have issued the Annual Secretarial Compliance Report for the financial year ended 31^st March, 2022, thereby confirming compliance by the Company of the applicable SEBI Regulations and circulars / guidelines issued thereunder.

Internal control systems and their adequacy

Your Company maintains adequate internal control system and procedures commensurate with its size and nature of operations. The internal control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorization of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances. The Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.

Public Deposits

During the year under review, your Company has not accepted any deposits from the public under Chapter V of the Act.

Subsidiaries

During the year under review, your Company does not have any subsidiaries or joint ventures or associate companies as defined under the Act. However, the Company has framed a policy for determining material subsidiaries, which can be accessed at web-link https://www.pranavaditva.com/wp-content/uploads/2019/10/psml-policv-on-material-subsidiaries.pdf

Corporate Governance Report

Your Company has adopted best practices of Corporate Governance and complied with all the requirement of Corporate Governance laid down by SEBI. As per Regulation 34(3) read with Schedule V of the Listing Regulations, a Corporate Governance Report along with Statutory Auditors' Certificate confirming compliance of corporate governance for the year ended 31^st March, 2022 is provided separately and forms integral part of this Annual Report.

Management and Discussion Analysis Report

Pursuant to Regulation 34 of the Listing Regulations, Management Discussion and Analysis Report containing information inter-alia on industry trends, your Company's performance, future outlook, opportunities and threats for the year ended 31^st March, 2022, is provided in a separate section forming integral part of this Annual Report.

Annual Return

Pursuant to the amendments in Section 92(3) of the Companies Act, 2013 read with Rules thereunder and provisions of Section 134(3)(a) of the Act, Annual Returns of the Company for FY 2020-21 and FY 2021-22 are hosted on the website of the Company www.pranavaditva.com and web-links thereto are given below:

Annual Return for FY 2020-21:https://www.pranavaditya.com/wp-content/uploads/2021/09/form mat 7 2021 psml website.pdf Annual Return for FY 2021-22: https://www.pranavaditva.com/wp-content/uploads/2022/07/annual-retum-form-mat-7-2021-22.pdf

Related Party Transactions

All Related Party Transactions (RPT) entered during FY 2021-22 with Holding Company were on arm's length basis. Prior approval of Audit Committee is obtained for all Related Party Transactions. A statement of all Related Party Transactions is reviewed by the Audit Committee and Board on quarterly basis.

During the year under review, the Company has entered into transactions of Lease of land, buildings and machinery to Indo Count Industries Limited (ICIL), Holding Company, which were material related party transactions (RPT). Prior approvals of Audit Committee, the Board and Shareholders of the Company was obtained for said material RPT The details of material related party transactions defined under Companies Act, 2013 are provided in Form AOC -2, attached to this Report as "Annexure 2". Further, the related party transactions as per IND AS 24 are also given in the notes to the financial statements.

Your Company has adopted a policy on Related Party Transactions and same is uploaded on the website of the Company at https://www.pranavaditva.com/wp-content/uploads/2022/06/psml-policv-on-related-partv-transactions.pdf

Particulars of Loans, Investments, Guarantees, Securities under Section 186 of the Companies Act, 2013

During the year under review, pursuant to the provisions of Section 186 of the Companies Act, 2013, no loans were given to any person, nor any Guarantees or securities were provided. Further, no investment was made in the securities of any other body corporate.

Risk Management

The Company has devised Risk Management Policy which takes care of risk identification, assessment and mitigation. Some of the risks faced by the Company are raw material price risk, financial risk, foreign currency risk etc. The details of Risk Management are included in Management Discussion and Analysis Report.

Vigil Mechanism / Whistle Blower Policy

Pursuant to the provisions of Section 177(10) of the Act and Regulation 22 of the Listing Regulations, your Company has established a vigil mechanism for the Directors and employees of the Company to report concerns about unethical behaviour, actual or suspected incidents of fraud or violation of Code of Conduct. The details of Vigil Mechanism/Whistle Blower Policy are provided in the Corporate Governance Report. The Vigil Mechanism/ Whistle Blower Policy may be accessed on the Company's website at https://www.pranavaditya.com/wp-content/uploads/2019/10/psml - whistle blower policy vigil mechanism.pdf

Policy on Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace

In order to prevent sexual harassment of women at workplace, your Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has constituted an Internal Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to look into the complaints relating to sexual harassment at workplace of any woman employee. During the year under review, your Company has not received any complaint pertaining to sexual harassment and no complaint was pending as on 31^st March, 2022.

Conservation of Energy, Technology Absorption & Foreign Exchange Earning & Outgo

Information on Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo required under Section 134(3)(m) of the Act, read with Rules thereunder is given as "Annexure 3" forming part of this Report.

Particulars of Employees and related disclosures

The information regarding remuneration of Directors, Key Managerial Personnel, median remuneration and other related disclosures required pursuant to Section 197 read with Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is provided as "Annexure 4-(I)" and "Annexure 4-(II)" to this report.

Significant or Material orders passed by Regulators / Courts

During the year under review, no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

Material Changes and Commitments affecting the Financial Position of the Company

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year 2021-22 to which the Financial Statements relate and the date of the Board's Report.

Secretarial Standards

During the year under review, your Company has complied with all the applicable secretarial standards issued by the Institute of Company Secretaries of India. The same has also been confirmed by Secretarial Auditors of the Company in the Secretarial Audit Report.

General

1. During the year under review, cost audit was not applicable to the Company; however, pursuant to the Order made by the Central Government for the maintenance of cost records under Section 148(1) of the Act, the prescribed accounts and records have been made maintained.

2. The provisions pertaining to Corporate Social Responsibility (CSR) were not applicable to the Company during the year under review.

3. As required in terms of Secretarial Standard (SS)-4, it is hereby confirmed that there is no corporate insolvency resolution process initiated under the Insolvency and Bankruptcy Code, 2016 and no proceeding is pending under the said code.

Acknowledgements and Appreciation

Your Directors take this opportunity to thank Central and State Governments, customers, suppliers, shareholders and bankers for their consistent support and co-operation to the Company. Your directors also place on record sincere appreciation for the contribution and commitment by all the employees of the Company.