PERFORMANCE OF THE COMPANY

Your company is primarily engaged in the business of manufacturing LDPE, HDPE, PP BOPP, PP MATS, SELF ADHESIVE TAPES, FOOD WRAPS and its related products and activities relating to industrial packaging, such as printing and pouching of mono layer plastic sheets, multi layer plastic sheets.

The total revenue of the company increased by 137.6 Lakh or by 12.07% to 1277.12 Lakh for the financial year 2023-24 from 1139.52 Lakh for the financial year 2022-23.

It also mentions here that our revenue from operations is 1268.13 Lakh for the financial year 2023-24 as compared to 1138.32 Lakh for the financial year 2022-23 representing an incline of 11.4% on account of increase in sales.

The company in spite of many challenges and competitive market conditions was able to achieve satisfactory sales and net profit ( after tax) figures. The management is of the opinion that in the coming future as the overall situation seems to be improving and Directors are optimistic about Company’s business and hopeful of better performance with increased revenue in next year.

COMPANY’S WEBSITE

The website of your Company https://www.clara.co.in/ displays the Company’s business operations up-front on the home page. The site carries a comprehensive database of information of all the products and services offered by the Company including other information for investors like the Financial Results of your Company, Shareholding Pattern, Directors & Senior Management personnel’s profile, details of Board Committees, Corporate Policies and business activities of your Company.

All the mandatory information and disclosures as per the requirements of the Companies Act, 2013 (hereinafter referred as “the Act”) and as per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as “SEBI LODR Regulations”) have been uploaded on the website.

CAPITAL STRUCTURE

During the financial year 2023-24, the Company undertook a significant step in strengthening its capital base by issuing equity shares through a rights issue. The Board of Directors approved the issuance of 16,53,986 equity shares of the Company, with a face value of Rs. 10 each, to the existing shareholders.

These shares were offered at a price of Rs. 167 per share, which includes a premium of Rs. 157 per equity share. The rights issue was conducted to provide an opportunity for our existing shareholders to increase their stake in the Company while allowing the Company to raise additional capital for its growth initiatives.

The funds raised through this issue will be utilized to support our expansion plans, reduce debt, and strengthen the overall financial position of the Company.

BOARD OF DIRECTORS

The Board comprises of eminent persons with high credentials of considerable professional experience and expertise, who effectively contribute to the Company’s growth and policy formulation decisions. The composition of Board of Directors of the Company is in conformity with the requirements of Regulation 17 of SEBI Listing Regulations as well as provisions of the Companies Act, 2013 (“the Act”) and the Articles of Association of the Company and all other applicable laws and in accordance with best practices. The Chairperson of the Board of the Company is the Promoter Executive Director. As on March 31, 2024, 2 (Two) out of 5 (five) Directors on the Board were Independent Directors. At Clara Industries Limited, it is our belief that a competent and diversified Board consciously creates a culture of leadership to provide a long-term vision and policy approach to improve the quality/ standards of governance. The Board’s actions and decisions are aligned with the Company’s interests and objectives. The Board critically evaluates the Company’s strategic direction, management policies and their effectiveness.

The category wise composition of Board of Directors under Regulation 17 of SEBI Listing Regulations as on March 31, 2024 is as under: 2 Executive Director, 1 Non-Executive Director, 2 Independent Director Non-Executive Director.

None of the Non-Executive Directors were involved in the day-to-day management of the Company during the year under review.

CHANGE IN DIRECTORSHIP

During the financial year 2023-24, there were significant changes in the composition of the Board of Directors concerning the position of Independent Directors.

Mr. Ajay Kumar Jain, who served as an Independent Director of the Company, tendered his resignation due to personal reasons. To fill the vacancy created by this resignation, the shareholders of the Company approved the appointment of Mr. Avdhesh Kumar Kamboj as an Independent Director. His appointment was made following the provisions of the Companies Act, 2013, and the rules framed thereunder. None of the Directors of the Company is disqualified for being appointed / re-appointed as directors of the company as per the provisions of Section 164 of the Companies Act, 2013.

CHANGE IN NATURE OF BUSINESS

Manufacturing of Paper and all types of food packaging products and manufacturing of machines and assembling of machine parts.

ANNUAL RETURN

The Annual Return of the Company in form of MGT-7 as required under Section 92 and Section 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the website of the Company at https://WWW.CLARA.CO.IN .

GENERAL RESERVES

The Accounting Standards permit that the amounts in the Profit after tax stands are included in the Reserve & Surplus Schedule; hence the Company has not transferred any amount to its General Reserves.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Companies Act, 2013.

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

The Board was of the view that the performance of the Board as a whole was adequate and fulfilled the parameters stipulated in the evaluation framework in its pro-growth activity. The Board also ensured that the Committee functioned adequately and independently in terms of the requirements of the Companies Act, 2013.

Further, the individual directors fulfilled their applicable responsibilities and duties laid down by the Companies Act, 2013 and at the same time contributed with their valuable knowledge, experience and expertise to grab the opportunity and counter the adverse challenges faced by the Company during the year.

PARTICULARS OF REMUNERATION OF DIRECTORS AND OTHER EMPLOYEES

No employee in the Company was in receipt of remuneration in excess of the amount mentioned Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

PUBLIC DEPOSITS

During the year under review, your Company has neither invited nor accepted any fixed deposits from the public within the meaning of Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 and hence any provisions of the said Section are not applicable to the Company.

DIVIDEND

In order to conserve the resources of the Company for growth and further expansion, the Board of Directors of the Company thought it prudent not to recommend any Dividend on the Equity Shares of the Company for the financial year ended March 31, 2024.

Pursuant to Regulation 43(A) of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 (“SEBI Listing Regulations”), the Company does not fall under top 1000 Listed Companies by market capitalization as on March 31,2024 and hence the requirement for adopting the Dividend Distribution Policy is not applicable to the Company.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

Pursuant to section 134(3)(d) of the Act, your Company confirm having received necessary declarations from all the Independent Directors under section 149(7) of the Companies Act, 2013 declaring that they meet the criteria of independence laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Independent Directors have submitted their declaration of independence, stating that: (i) they continue to fulfil the criteria of independence as required pursuant to section 149(6) read with schedule IV of the Act and regulation 16(1)(b) of the SEBI Listing Regulations; (ii) they have confirmed that they are not aware of any circumstances or situation which exist or may be anticipated, that could impair or impact their ability to discharge their duties in terms of regulation 25(8) of the SEBI Listing Regulations; (iii) they are not debarred from holding the office of Director pursuant to any SEBI order or order of any such authority; and (iv) there has been no change in the circumstances affecting their status as Independent Director of the Company.

All Independent Directors have affirmed compliance to the code of conduct for independent directors as prescribed in schedule IV to the Act. The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, skills, experience and expertise and they hold highest standards of integrity(including the proficiency) and fulfils the conditions specified in the Act and SEBI Listing Regulations and are independent of the management.

SEPARATE MEETING OF INDEPENDENT DIRECTOR

In accordance with Section 149 (7) of the Act read with Para VII (1) of Schedule IV of the Act and Regulation 2of Listing Regulations, a separate Meeting of the Independent Directors of the Company was held on March 10 , 2024 without the presence of Non-Independent Directors and Members of the management.

The Independent Directors at the meeting, inter alia, reviewed the following: -Performance of Non-Independent Directors and Board as a whole.

Performance of the Chairman of the Company, taking into account the views of Executive Directors and Non-Executive Directors .

Assessed the quality, quantity and timeliness of flow of information between the Company, Management and the Board that is necessary for the Board to effectively and reasonably perform their duties

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY TRANSACTIONS

All contracts, arrangements and transactions entered by the Company with related parties during FY 2023-24 were in the ordinary course of business and on an arm’s length basis. During the year, the Company did not enter into any transaction, contract or arrangement with related parties, which could be considered material, in accordance with the Company’s Policy on dealing with Related Party Transactions (“RPT Policy”).

Accordingly, the disclosure of related party transactions in Form AOC-2 is not applicable. All applicable related party transactions were presented before the Audit Committee/Board. The disclosure on related party transactions as per Ind AS-24 has been provided under Note of the standalone financial statements of the Company

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

During the financial year ended March31, 2024, no loan, guarantee and investment was made by the Company in terms of Section186 of the Act and rules made there under.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

During the year under review, Company does not have any subsidiary, joint-venture or associate companies.

CORPORATE SOCIAL RESPONSIBILITY

In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy)Rules, 2014 as amended, the Company has constituted Corporate Social Responsibility (“CSR”) Committee. The CSR Committee has formulated and recommended to the Board, a CSR Policy which provides the overview of projects or programs and the guiding principles for selection, implementation and monitoring of the CSR activities, which has been approved by the Board. The CSR Policy adopted by Board is available on the website of the Company and is accessible through the link: WWW.CLARA.CO.IN

As per the provisions of the Companies Act, 2013, a company meeting the specified criteria shall spend at least 2% of its average net profits for three immediately preceding financial years towards CSR activities. Accordingly, Company has to spent Rs. 6.82 Lakh towards CSR activities during the financial year 2023-24.

The Board of Directors noted that Company’s CSR spend for the year ended March31, 2024, was Rs. 6.82 Lakh as against its obligation of Rs. 6.82 Lakh. Pursuant to the recommendation by Corporate Social Responsibility Committee and approval by the Board of Directors.

The Annual Report on CSR activities of the Company has been attached as Annexure - B and forms part of this Report.

CORPORATE GOVERNANCE

The Company being listed on the Small and Medium Enterprise Platform is exempted from provisions of corporate governance as per Regulation 15 of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulation, 2015. Hence no corporate governance report is disclosed in this Annual Report. It is Pertinent to mention that the Company follows Majority of the provisions of the corporate governance voluntarily.

TRANSFER TO RESERVES

The Board of Directors have decided to retain the entire amount of profit for Financial Year 2023-24 in the Statement of Profit & Loss as on March 31, 2024

CREDIT RATING

During the year under review, Company has no outstanding instruments for which the credit rating needs to be obtained.

BOARD MEETINGS

During the year under review, the Board of the Company met on 05/05/2023. The intervening gap between two Board Meetings did not exceed one hundred and twenty days as provided in Section 173 of the Act and Regulation 17 of the SEBI Listing Regulations. The details of all Board meetings and the attendance of each Director in the Board Meetings and last AGM held on September 28, 2023 are provided in the Corporate Governance Report forming integral part of this Report., 31/05/2023/, 07/06/2023, 20/06/2023, 06/09/2023

DIRECTOR’S ATTENDANCE RECORD

The last Annual General Meeting was held on September 28th 2023. The attendance record of the Directors at the Board Meeting during the year ended on March 31, 2024, and at the last Annual General Meeting is as under:

BOARD COMMITTEES

In accordance with SEBI (Listing Obligations and Disclosure Requirements), 2015, provisions on Corporate Governance the Board of Directors of the Company had constituted following Committees. The details are as under: (a) Audit Committee (b) Nomination & Remuneration Committee (c) Shareholder’s & Investor’s Grievance Committee (d) Internal Complaint Committee The composition of various committees are as follows:

AUDIT COMMITTEE

The terms of reference of the Audit Committee are as per the guidelines set out in the Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 with the stock exchanges read with Section 177 of the Companies Act, 2013. The detail of the Committee is as follows:

NOMINATION AND REMUNERATION COMMITTEE

The Board of Directors of the Company has constituted a Nomination & Remuneration Committee, as per the provisions of Section 178 of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements), Regulation 2015, with the object of Remuneration & Nomination Committee is to recommend / review the remuneration of Managing Directors / Wholetime Directors. The remuneration policy of the Company is directed towards rewarding performance and attracting new talents / retaining them. While deciding the remuneration, the Committee considers the financial position of the Company, trend in the Industry, Appointee’s qualification, experience, past performance, past remuneration etc.

STAKEHOLDER’S RELATIONSHIP AND INVESTOR’S GRIEVANCE COMMITTEE

The Committee is in charge of looking after grievances of Investors and Shareholders. The details of the committee is as follows:

INTERNAL COMPLAINT COMMITEE

The Committee is in charge of looking after grievances of internal complaints of the company. The details of the Committee is as follows:

CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE

The Committee is in charge of looking after all the CSR activities of the company. The details of the Committee is as follows:

STATUTORY AUDITORS

Pursuant to provisions of Section 139 of the Act read with rules made there under, M/s. Gupta Agarwal & Associates, Chartered Accountants, (Firm Registration No.329001E), were appointed as Statutory Auditors of the Company at the 1st AGM held on September 30, 2022 for a period of 5 years from Financial Year 2022-23 to Financial Year 2026-27 until the conclusion of AGM of the Company to be held in the year 2027.

The report given by M/s. Gupta Agarwal & Associates, Chartered Accountants, Statutory Auditors on financial statements of the Company for Financial Year 2024 forms part of the Annual Report. The comments on statement of accounts referred to in the report of the Auditors are self-explanatory. The Auditors’ Report does not contain any qualification, reservation or adverse remark.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Act read with the

Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed M/s. Verma Ashish & Co.(Peer reviewed firm) (Membership No. 59867) for conducting the Secretarial Audit of the Company. The Secretarial Audit Report for the Financial Year ended March 31, 2024, is annexed herewith as Annexure - A to this report. The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimers for the period under review.

MAINTENANCE OF COST RECORDS

The maintenance of Cost Records as specified by the Central Government under Section 148(1) of the Act is not applicable to the Company as the business activities of the company does not fall under any of the categories prescribed under Section 148(1) of the Act.

REPORT ON FRAUDS U/S 143 (12) OF THE COMPANIES ACT, 2013

During the year under review, the Statutory Auditors and the Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under Section 143(12)of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF FINANCIAL YEAR

Except as disclosed elsewhere in the Annual Report, no material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year 2023-24 and till the date of signing of this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 in respect of conservation of energy and technology absorption have not been furnished considering the nature of activities undertaken by the company during the year under review and hence are not required to be given.

The Company has not entered into any technology transfer agreement and also there are no foreign currency earnings and outgo during the financial year.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year under review, the provision of section 125(2) of the Act does not apply as the company was not required to transfer any amount to the Investor Education and Protection Fund (IEPF) established by the Central Government of India. The Company has designated the Company Secretary as ‘Nodal Officer’ for the purposes of IEPF related matters.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS

During the year under review, there were no significant material orders passed by regulators or courts or tribunals impacting the going concern status and company’s operation in future.

SIGNIFICANT RISK MANAGEMENT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS

The Company has developed and implemented a Risk Management policy for identifying the risk associated with business of the Company and measures to be taken to control them. The company has established a well-defined process of risk management, wherein the identification analysis and assessment of the various risks, measuring of the probable impact of such risks, formulation of risk mitigation strategy and implementation of the same takes place in a structured manner

Though, the various risks associated with the business cannot be eliminated completely, all efforts are made to minimize the impact of such risks on the operations of the Company.

The Company is not required to form a Risk Management Committee. The Board of Directors of the Company and the Audit Committee shall periodically review and evaluate the risk management system of the Company.

INTERNAL CONTROL SYSTEMS INCLUDING INTERNAL FINANCIAL CONTROLS

The Company has put in place an adequate Internal Control System, to commensurate with size, scale and complexity of its operations. They have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable statutes, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance of corporate policies.

During the year under review, no material or serious observation has been highlighted for inefficiency or inadequacy of such controls.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As stipulated under the provisions of Regulation 34 of the Listing Regulations,

Management Discussion & Analysis Report is presented in a separate section forming part of Annual Report and provides details on overall Industry Structure and Developments, financial and operational performance and other material developments during financial year under review.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In line with the provisions of the Section 177(9) of the Companies Act, 2013 and the SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS Regulation 22 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, your Company has adopted Whistle Blower Policy, as part of vigil mechanism to provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the fundamental business principles of the Company.

This vigil mechanism provides for adequate safeguards against victimization of employees and directors who avail of the vigil mechanism and also provide for direct access to the chairperson of the Audit committee, in exceptional cases. The Company Secretary is the designated officer for effective implementation of the policy and dealing with the complaints registered under the policy.

During the year under review, no incidence under the above mechanism was reported.

CODE OF CONDUCT

The Company has adopted a Code of Conduct to regulate, monitor and report trading by Designated Persons [Pursuant to Regulation 9 of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015]. This Code of Conductis intended to prevent misuseof Unpublished PriceSensitive Information (“UPSI”)by Designated Persons and their immediate relatives.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section134(5) of the Act, your directors state that:

In the preparation of the annual accounts, the applicable accounting standards had been followed and no material departures have been made from the same; the Directors had selected Appropriate accounting policies have been applied consistently and judgements and estimates that are reasonable and prudent have been made, so as to give a true and fair view of the state of affairs of the Company as at the end of financial year and of the profit & loss of the Company for that period; the Directors had 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; the Directors had prepared the annual accounts on a going concern basis; the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

The Company is committed to providing a safe and conducive work environment to all its employees and associates. The Company has constituted Internal Committee as per the sexual Harassment of Women & workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, no complaint was received under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

COMPLIANCE WITH SECRETARIAL STANDARDS

During the financial year under review, the Company had complied with applicable Secretarial Standards on Board and General Meetings specified by the Institute of Company Secretaries of India pursuant to Section 118 of the Act.

ANY PROCEEDINGS UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.

HUMAN RESOURCE MANAGEMENT

Management of Clara Industries Limited recognizes that its workforce is its most valuable asset and is crucial to driving success. With an employee-centric approach, the company strives to create a secure and stimulating workplace that boosts productivity. Clara Industries Limited invests in its employees by enhancing their skills, refining their expertise, and developing their leadership abilities through relevant learning and development programs. The company respects diversity among its employees and aims to strengthen its corporate capabilities accordingly.Clara Industries Limited’s Management promotes teamwork and a self-motivating work environment to support the comprehensive growth of its employees. To reinforce its human capital and attract, develop, and acknowledge exceptional talent, Clara Industries Limited has established human resource policies focused on fostering a positive work environment.

BOARD OF DIRECTORS

Our Board Of Directors

Our Articles of Association require us to have not less than 3 Directors and not more than 15 Directors, subject to the applicable provisions of the Companies Act, 2013. As of the date of this, Our Company has 5 (Five) Directors on our Board, which includes, one (01) Managing Director, one (01) Non-Executive Director and two (02) Independent Directors, one of whom is also the woman independent director of our Company.

Set forth below are details regarding our Board as on the date.

CAUTIONARY STATEMENT

Statements in the Report describing the Company’s projections, estimates, and expectations may be interpreted as ‘forward-looking’ statements within the meaning of applicable laws and regulations. Actual results could differ from those expressed or implied. Important factors that could make a difference to the Company’s operations include economic conditions affecting demand/supply, price conditions in the domestic and international markets in which the Company operates, changes in Government regulations, tax laws, and other statutes. The Company assumes no responsibility to publicly amend, modify, or revise any ‘forward-looking’ statements, based on any subsequent development, information, or events

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their gratitude to Ministry of Corporate Affairs and other agencies of Central and State government for their kind support and guidance.

Your Directors also wish to place on record their appreciation for the dedicated efforts put in by the employees of the Company at all levels who have contributed to the growth and performance of your Company.

Your Directors also thank the clients, vendors, bankers and advisers of the Company for their continued support.

In conclusion, your Directors thank you, the members of the Company for your support and seek your continued patronage for achieving better results.