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MANAGEMENT DISCUSSION & ANALYSIS

DEAR SHAREHOLDERS,

The Board is pleased to present the 50th Annual Report together with the audited financial statements for the year ended 31 March 2023.

1. Business Environment

Asian economies are expected to drive most of global growth in 2023, as they benefit from less intense inflationary pressures compared to other regions. In FY 2022-23, the business environment faced numerous challenges impacting growth. These included the Geo-political tension causing energy price surges, rising inflation and disruptions to global supply chains.

Nevertheless, the global economy is still projected to grow, (albeit slower than in 2022) with the International Monetary Fund (IMF) forecasting a 2.8% global GDP growth in 2023 compared to 3.4% in 2022. Global headline inflation in the baseline is set to fall from 8.7 percent in 2022 to 7.0 percent in 2023 on the back of lower commodity prices but underlying (core) inflation is likely to decline more slowly. Looking ahead to next year, uncertainties arise from factors such as the increased Geo-political tension, and monetary tightening in major economies, which may affect the projected 2.8% global GDP growth.

Indian Economy: The Indian economy is expected to grow at a slower pace in the next financial year, than it did in the previous year. The Reserve Bank of India (RBI) projects that GDP growth will slow down to 6.5% in FY 2023-2024, from 7.2% in FY 2022-2023. The Capital Expenditure of Central Government and crowding in the private Capex is one of the growth driver of the Indian economy in the current year. With an emphasis on infrastructure-intensive sectors like roads and highways, railways, and housing and urban affairs in Budget 2023, the increase in Capex has large-scale positive implications for medium-term growth. The Production Linked Incentive (PLI) schemes were introduced across 14 categories to plug India into global supply chains. Despite the global challenges, there are positive signs for the Indian economy in FY 2023-2024. There is still a lot of pent-up demand for goods and services and domestic consumption will continue to drive the overall growth.

• Economic trends: The Indian economy is expected to grow at a moderate pace in the next financial year, supported by strong domestic demand and continued investment. However, any increase in commodity prices and supply chain disruptions could pose challenges.

• Industrial sector: The industrial sector is expected to grow at a slower pace in the next financial year, as some sectors, such as manufacturing, face headwinds from rising input costs and global trade disruptions.

• _India's_fiscal_deficit_position: India's fiscal deficit is expected to widen in the next financial year, as the government increases spending on infrastructure and social welfare programs. However, the deficit is still expected to be below the 3% of GDP target.

• India's economic resurgence: India's economy has rebounded strongly from the COVID-19 pandemic and is now one of the fastest-growing major economies in the world.

Overall, the Indian economy is expected to continue to grow at a moderate pace in the next financial year.

The growth will be supported by strong domestic demand, continued investment, and a favorable external environment.

The global industrial gear sector is poised for steady growth, with a projected compound annual growth rate (CAGR) of 5% from 2023 to 2027.

This expansion is driven by increasing demand for gears across diverse industries, including automotive, aerospace, and manufacturing.

The aerospace industry, another significant consumer, is projected to exhibit a CAGR of 5% from 2023 to 2027. This growth is primarily attributed to escalating demand for commercial aircraft, underscoring the pivotal role of gears within the aerospace gear market.

Simultaneously, the manufacturing industry plays a substantial role in gear consumption and is anticipated to demonstrate a CAGR of 4% from 2023 to 2027. The persistent demand for industrial machinery is expected to be a key driver behind the growth observed in the manufacturing gear market.

The global gear sector presents promising opportunities as it embraces the burgeoning demand from automotive, aerospace, and manufacturing industries. With its steady growth trajectory, the sector is poised to navigate the challenges ahead while capitalizing on the potential for further advancements.

Indian gear sector prospects:

The Indian gear sector is expected to grow at a CAGR of 4-6% from 2023 to 2027. This growth is being driven by the increasing demand for gears in a variety of industries, including aerospace and manufacturing. The aerospace industry is another major consumer of gears in India and is expected to grow at a CAGR of 9% from 2023 to 2027. The increasing demand for commercial aircraft is expected to drive growth in the aerospace gear market in India.

The manufacturing industry is also a major consumer of gears in India and is expected to grow at a CAGR of 6% from 2023 to 2027. The increasing demand for industrial machinery is expected to drive growth in the manufacturing gear market in India.

Indian government notable initiatives and developments

The Indian government has taken several initiatives to boost the growth of the gear sector in India.

• The Production-Linked Incentive (PLI) Scheme for Gear Manufacturing: The PLI scheme provides financial incentives to gear manufacturers in India.

This scheme is expected to attract new investments in the gear sector and boost domestic production of gears.

• The National Manufacturing Policy (NMP): The NMP aims to make India a global manufacturing hub. The NMP includes several measures to boost the gear sector, such as the development of a national gear park and the promotion of exports of gears.

• The National Investment Manufacturing Zones (NIMZs): The NIMZs are special economic zones that are designed to attract investment in manufacturing. The NIMZs include several gear manufacturing clusters, which are expected to boost the growth of the gear sector in India.

Union Budgets Projection

The Union Budget for the coming financial year is expected to include several measures to boost the growth of the gear sector in India.

The Indian gear sector is expected to grow in the next financial year and this growth is being driven by the increasing demand for gears in a variety of industries, as well as the Indian government's initiatives to boost the manufacturing sector. All these factors point to one reality, the demand for gears will remain strong over the coming years.

Sector-wise prospects Railway

Indian Railways has made sustained efforts to improve the ease of doing business as well as improve the service delivery at competitive prices which has resulted in new traffic coming to railways from both conventional and non-conventional commodity streams. Demand for High Power

Diesel Locomotives, AC Locos will be on upswing considering the impetus given in the Railway Budget. Vande Bharat Express has gained immense popularity with about 10 Trains running and more poised to be introduced as the high priority areas of Railways. The conventional Electric Multiple Units, Diesel Multiple Units and Diesel Electric Tower car will continue to be produced in Railway Production units of ICF/RCF/ MCF to meet the increasing demands.

Extrusion

India extruded plastic is projected to expand at a CAGR of about 8% in the next 3 years. Extruded plastic market is growing at a faster rate in the country on account of rapid urbanization and expanding middle class group. Government initiatives to boost rural infrastructure is fueling the demand for PVC extrusions in the construction sector. Burgeoning demand for flexible packaging is fueling the growth of PE, PET, and PP extrusions. On the rubber extrusion and rubber machinery front the market is growing rapidly. The rubber extruder market is projected to increase at a CAGR of 5.3% during the forecast period up to 2023.

Crane and Material Handling

The cranes market in India is majorly driven by increasing construction activities. Also, significant by governments and private firms in infrastructural activities are positively influencing market expansion.

India crane market size will be valued at USD 1.3 billion by 2027, growing at a compound annual growth rate (CAGR) of 5.56% by volume.

In India expansion plans of major Steel manufacturers to enhance capacity by 20 Mio tonnes will increase the demand for high-capacity Cranes for EOT application. Besides the Indian government is anticipated to boost its expenditure on public infrastructure to meet up its aspiring development plans which will spur Gantry and Medium capacity EOT cranes.

Rapid industrialization and increased demand for automation in material handling equipment are expected to fuel the market growth in this segment. The ongoing modernization of industrial facilities and infrastructures to improve their production capacity is anticipated to drive the growth of the material handling equipment market.

Cement

India produces over 7% of the world's installed cement capacity, making it the second-largest cement producer in the world. India currently produces 298 Million Tonnes per Annum of cement at its installed capacity of 500 MTPA The Indian government unveiled its "PM Gati Shakti

– National Master Plan (NMP)" for multimodal connectivity in October 2021. It will include infrastructure initiatives from different Ministries and State Governments, such as UDAN, Bharatmala, Sagarmala, inland waterways and dry/land ports

By FY 2027, the demand for cement in India is anticipated to reach 419.92 Million Tonnes. According to the IMARC report, the CAGR for the cement market in India is predicted to be 4.8% from 2023 to 2027 investments

Steel

India is the second-largest producer of crude steel in the world and plans to triple its production. The industry is witnessing consolidation of players, which has led to investment by entities from other sectors. This consolidation also presents an opportunity to global players to enter the Indian market. Under the Union Budget 2023-24, the government allocated _70.15 crore (US$ 8.6 million) to the Ministry of Steel. Easy availability of low-cost manpower and presence of abundant iron ore reserves make India competitive in the global set up. India is home to fifth-highest reserves of iron ore in the world.

2. Company Performance

* The Board has declared and paid Interim Dividend of _ 3 per equity share and has proposed Final Dividend of _ 2 per equity share for the financialyear 2022-23, which is subject to the approval of the members at the ensuing Annual General Meeting.

4. Review of Operations

In FY 2022-23, the Company reported improved performance for second consecutive year and the company posted its best in terms of Revenue and

Profit despite the adverse Global economic factors.

Revenue from Operations at _446 crores, registering a growth of 32% over the previous year. This growth was mainly aided by healthy order inflow and ramp up of production.

Focus on all segment helped in sustaining the competitive advantage. The business continued to build relationships through high levels of customer engagement during the year.

The company focused on lean initiatives and improved the production levels. Capital investments were made wherever technological upgradation was required.

EBITDA increased from _69.10 crore in FY22 to _101.07 crores in FY23 a growth of 46%. The Company registered a net profit of _67.05 crores (an 58% increase).

From a liquidity standpoint, the Company generated a Free Cash Flow of _39.17 crore during the financial year and registered 15% growth over the previous year. Free Cash Flow to PAT is 58%.

The Company's Return on Invested Capital improved to 56% in FY 23 from 36% in FY 22 aided by increase in utilisation of assets and better working capital management.

The Company remains debt free and invests its surplus funds judiciously balancing safety and returns.

4. Dividend

The Board of Directors declared an Interim Dividend of _3/- per share (@ 300%) on equity share of face value of _1/- each for the financial year 2022-23, which was paid on 14th February, 2023 to all the eligible shareholders. Final dividend of _2/- per share (@ 200%) has been proposed by the Board for the said financial year and together with the Interim

Dividend of _3/- per equity share, already declared and paid, in respect of the financial year 2022-23, _5/- per share (@500%) will be considered as the total Dividend for the said financial year.

The dividend pay-out this year got exceeded w.r.t Company's policy on Dividend Distribution to commemorate the completion of 50 years of Shanthi Gears Limited. The Dividend Policy as approved by the Board is uploaded and is available on the following link on the Company's website, http://www. shanthigears.com/wp-content/uploads/2021/04/SGL-Dividend-Distribution Policy.pdf.

Details thereof also form part of this Annual Report for the information of shareholders as Annexure A.

5. Share Capital

ThepaidupEquityShareCapitalason31stMarch,2023 was _7.67 Crores.

6. Deposits

The Company has not accepted any fixed deposits under Chapter V of the Companies Act, 2013 and as such no amount of principal and interest was outstanding as on 31st March, 2023.

7. Particulars of Loans and Guarantees

During the year under review, the Company has not given any loans or guarantees under the provisions of Section 186 of the Companies Act, 2013. As part of treasury management, the Company deploys short-term surplus in units of mutual funds, the details relating to which form part of the Notes to the financial statements provided in this Annual Report.

8. Directors

Mr. Mukesh Ahuja, will retire by rotation at the ensuing Annual General Meeting under Section 152 of the Companies Act, 2013 and being eligible, he offers himself for re-appointment.

Mr. Arun Venkatachalam, has been appointed as Additional Director (Non-Executive Director) on 09th May, 2023 liable to retire by rotation and he continues upto the ensuing Annual General Meeting. Necessary resolution proposing the appointment of Mr. Arun Venkatachalam as a Director liable to retire by rotation under Sec 152 of the Companies Act, 2013 forms part of this Annual General Meeting. Mr. S K Sundararaman, Independent Director will hold office up to the date of the ensuing Annual General Meeting. The Board recommends his re-appointment as an Independent Director under

Section 149 of the Act for further term of five years from 26th July, 2023 till 25th July, 2028 forms part of this Annual General Meeting. The Board takes pleasure in recommending the appointment of Mr. Arun Venkatachalam as Director and re-appointment of Mr. S K Sundararaman as Independent Director of the Company.

All the Independent Directors of the Company have furnished necessary declaration in terms of Section 149(6) of the Act affirming that they meet the criteria of independence as stipulated under the Act. In the opinion of the Board, all the Independent Directors fulfill the conditions specified in the Companies Act, 2013 and Rules made thereunder and SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 and are independent of the Management.

Notice has been received from a Member proposing the candidature of Mr. Arun Venkatachalam as Director and Mr. S K Sundararaman as Independent Director of the Company.

9. Key Managerial Personnel

Mr. C Subramaniam, resigned as Company Secretary w.e.f 31st January, 2023 to pursue other interests. The Board wishes to place on record the valuable contribution made by Mr. C Subramaniam during his tenure with the Company. Mr. Walter Vasanth P J, was appointed as Company Secretary of the Company w.e.f 29th March, 2023.

Mr. M Karunakaran, Whole-time Director, Mr. Walter Vasanth P J, Company Secretary and Mr. Ranjan Kumar Pati, Chief Financial Officer are the Key Managerial Personnel (KMP) of the Company as per Section 203 of the Companies Act, 2013.

10. Internal Control System and their Adequacy

The Company has an Internal Control System, commensurating with its size, scale and complexity of its operations. It has a sound system of internal controls in place to ensure the achievement of goals, evaluation of risks, and reliable financial and operational reporting. This efficient internal control procedure is driven by a robust system of checks and balances that ensures the safeguarding of assets, compliance with all regulatory norms, and procedural and systemic improvements periodically. The Company uses an ERP (Enterprise Resource Planning) package supported by in-built controls. This guarantees timely financial reporting. The audit system periodically reviews the control mechanism and legal, regulatory, and environmental compliances. The internal audit team also checks the effectiveness of internal controls and initiates necessary changes arising out of inadequacies, if any. All financial and audit controls are further reviewed by the Audit Committee of the Board of Directors.

11. Internal Financial Control Systems with reference to financial statements

The Company has a formal system of internal financial control to ensure the reliability of financial and operational information, and regulatory and statutory compliances. The Company's business processes are enabled by an Enterprise-wide Resource Platform (ERP) for monitoring and reporting processes .accountability resultingfinancial discipline and

12. Enterprise Risk Analysis and Management

The Company's risk strategy is determined by its risk appetite defined by a series of risk criteria.

The criteria are based on sectoral realities, customer circumstances, liquidity available and its earnings target within accepted volatility limits. These criteria provide a reference for our operating divisions.

The Company's risk management framework comprises a combination of centrally issued policies and divisionally-evolved procedures that are regularly reviewed for their alignment with sectoral dynamics and evolving trends.

The framework encompasses strategy and operations and seeks to proactively identify, address and mitigate existing and emerging risks with the goal of making the business model emerge stronger and business growth becomes sustainable.

The Company has constituted a Risk Management Committee aligned with the requirements of the Companies Act, 2013 and Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of this Report.

The Company operates across various product platforms built over the years. Relative advantages and disadvantages of such product verticals are studied and advances are tracked. The Company seeks to address technology gaps through continuous benchmarking of existing manufacturing processes with developments in the industry and in this connection has made arrangements with technology consultants.

Sub-par utilization of capacities may lead to inadequate leverage benefits. The Company is ramping up its marketing efforts towards successful product establishment and market acceptance of its products, exploring development of alternate products and establishing a range of applications.

13. Corporate Governance

Your Company is committed to maintaining high standards of Corporate Governance. A report on

Corporate Governance, along with a certificate the Practicing Company Secretary on compliance with Corporate Governance norms forms part of this report as Annexure H.

14. Corporate Social Responsibility (CSR)

As a corporate citizen, your Company is committed to the conduct of its business in a socially responsible manner. The Company contributed a portion of its profit for the promotion of worthy causes like education, healthcare, scientific research etc.

As a part of Corporate Social Responsibility program, the Company has undertaken projects in the area of Education, Scientific Research, etc., List of CSR Activities, Composition of CSR Committee and CSR Policy is annexed herewith as Annexure B.

15. Annual Return

The Annual return in Form MGT-7 is available on the Company's website at the following link: http://www. shanthigears.com/annual-return/

16. Directors Responsibility Statement

Pursuant to Section 134 (5) of the Companies Act, 2013, the Board of Directors to the best of their knowledge and belief confirm that:

a. Inthepreparationoftheannualaccounts,applicable Accounting Standards have been followed and that there were no material departures therefrom;

b. They have, in the selection of the accounting policies, consulted the statutory auditors and have applied their recommendations 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 31st March, 2023 and of the profit of the Company for the year ended on that date;

c. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. They have prepared the annual accounts on a going concern basis;

e. They have laid down internal financial controls from to be followed by the Company and that such internal financial controls are adequate and were operating effectively during the year ended 31st March, 2023; and

f. Proper system has been devised to ensure compliances with the provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March, 2023.

17. Policy on Appointment and Remuneration of Directors

Pursuant to Section 178 (3) of the Companies Act, 2013 the Nomination and Remuneration Committee of the Board of the Company has formulated the criteria for Board nominations as well as policy on remuneration for Directors and employees of the Company.

The Remuneration policy provides the framework for remunerating the members of the Board, Key Managerial Personnel and other employees of the Company. This policy is guided by the principles and objectives enumerated in Section 178 (3) of the Companies Act, 2013 and reflects the remuneration philosophy and principles of the Murugappa Group to ensure reasonableness and sufficiency of remuneration to attract, retain and motivate competent resources, a clear relationship of remuneration to performance and a balance between rewarding short and long-term performance of the Company.

The policy lays down broad guidelines for payment of remuneration to Executive and Non-Executive Directors within the limits approved by the shareholders. The Board Nomination criteria and the Remuneration policy are available on the website of the Company at http://www.shanthigears.com/ wp-content/uploads/2019/05/SGL-Remuneration-Policy-Mar-2019.pdf

18. Related Party Transactions

All related party transactions that were entered during the year under review were on an arm's length basis and were in ordinary course of business.

There are no materially significant related party transactions during the year which may have a potential conflict with the interest of the Company at large. Necessary disclosures as required under Accounting Standard (Ind AS 24) have been made in the notes to the Financial Statements. The Policy on Related Party Transactions, as approved by the Board, is uploaded and is available on the Company's website http://www.shanthigears.com/wp-content/ uploads/2022/09/SGL-RPT-Policy_1-Apr-2022.pdf None of the Directors had any pecuniary relationships or transactions vis-?-vis the Company.

All transactions with Related Parties under the

Companies Act, 2013, entered during the financial year were in the ordinary course of business at arm's length and hence no particulars are required to be entered in the Form AOC-2. Further, all transactions entered into with Related Parties during the year even at arm's length basis in the ordinary course did not exceed the thresholds prescribed under the Companies (Meetings of Board and its Powers) Rules, 2014 or Listing Regulations or the Company's Policy in this regard and hence no disclosure was required to be made in Form AOC-2. Accordingly, there are no contracts or arrangements entered into with Related Parties during the year to be disclosed under Sections 188(1) and 134(3) (h) of the Companies Act, 2013 in Form AOC-2. The form is enclosed as Annexure E.

19. Board Evaluation

The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

20. Vigil/Whistle Blower Policy

The details of vigil mechanism/Whistle Blower policy are given in the Corporate Governance Report.

21. Business Responsibility & Sustainability Reporting

As required under the SEBI Listing Regulations which mandate the inclusion of a Business Responsibility & Sustainability Report as part of the Annual Report for the top 1000 listed entities based on market capitalisation, the Business Responsibility Report forms part of the Annual Report as Annexure G. The Business Responsibility Policy of the Company is displayed in the Company's website at the following link: http://www.shanthigears.com/wp-content/ uploads/2020/06/SGL-BRR-Policy-May-2020.pdf

22. Declarations/Affirmations

During the year under review:

• There were no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate viz., 31st March, 2023 and the date of this Report;

• There were no significant the regulators or courts or tribunals impacting the Company's going concern status and its operations in future.

23. Human Resources

Intellectual capital has been the cornerstone of Shanthi Gear's sustenance over the years. The Company has a large pool of engineers. This critical competitive edge has enabled the Company to stand out from the clutter and develop niche solutions that address the ever-evolving requirements of the sectors it caters to. The HR strategy and initiatives of your Company are designed to effectively partner the business in the achievement of its ambitious growth plans and to build a strong leadership pipeline for the present and several years into the future. Industrial Relations continued to be cordial. Senior leaders have been investing lot of time and efforts in identifying and developing succession pipeline for critical positions in the organization. The transition management programmes viz., FTF and LEAD have been very successful and as part of the programme, implementation of Individual Development Plans (IDPs) for talent pool identified through these programmes is being facilitated. The IDPs are being reviewed regularly and On-the-Job projects, job enlargement/job rotation, mentoring support to the Talents are being provided. Coaching & mentoring was done for select talent across the organization with an intent of developing future leaders. Internal employees have been given opportunities to take up higher roles and grow in the system under Grow from within Scheme.

The Company had 536 permanent employees on its rolls, as on 31st March, 2023. The disclosure with respect to remuneration as required under Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached and forms part of this Report as Annexure C.

The information relating to employees and other particulars required under Section 197 of the material orders passed by Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members excluding the information on employees, particulars of which are available for inspection by the Members at the Registered Office of the Company during business hours on all working days of the Company up to the date of the forthcoming Annual General Meeting. If any Member is interested in obtaining a copy thereof, such member may write to the Company Secretary in the said regard.

24. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed herewith as Annexure D.

25. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has in place a Prevention of Sexual Harassment policy (POSH) in line with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Compliance Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, contractual, temporary and trainees) are covered under this policy. The Company has not received any complaint about sexual harassment during the year 2022-23.

26. Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. R Sridharan & Associates, Company Secretaries to undertake Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and forms part of this Report as Annexure F Accordingly, no qualification or observation or other remarks have been made by the Secretarial Auditor in his Report.

27. Auditors

As per the provisions of Section 139 of the Companies Act, 2013, the term of Office of M/s Deloitte Haskins & Sells, Chartered Accountants (Firm Registration No. 008072S), Chartered Accountants come to an end at the close of the 50th Annual General Meeting of the Company.

The Board of Directors wish to place on record their sincere appreciation for the services rendered by M/s.Deloitte Haskins & Sells, Chartered Accountants, as Statutory Auditors of the Company, during their tenure with the Company.

Subject to the approval of the Members of the Company at the ensuing 50th Annual General Meeting, the Board of Directors has recommended the appointment of M/s. MSKA & Associates, Chartered Accountants as Statutory Auditors of the Company pursuant to Section 139 of the Companies Act, 2013. The Audit Committee at its meeting held on 09th May, 2023 had recommended their appointment as Statutory Auditors pursuant to Section 139 (11) of the Companies Act, 2013. Written consents from the incoming Auditors have been obtained, confirming that they satisfy the legal requirements for their appointment. The proposal relating to their appointment has been included in the notice convening the 50th Annual General Meeting of the Company. They shall hold office from the conclusion of 50th Annual General Meeting till the conclusion of 55th Annual General Meeting.

The report of Statutory Auditors viz., M/s.Deloitte Haskins & Sells, Chartered Accountants, for the year ended 31st March, 2023 does not contain any qualification, reservation or adverse remark and no instance of fraud has been reported by Auditors under Section 143(12) of Companies Act, 2013. Mr. B. Venkateswar was appointed as Cost Auditor for audit of the Cost Accounting records of the Company for the year ended 31st March, 2024.

A resolution seeking Members' ratification of the Remuneration payable to Cost Auditor is included in the AGM notice dated 09th May, 2023. The Cost Audit report will be filed within the stipulated period.

28. Subsidiaries/Associates/Joint Ventures

The Company does not have any subsidiaries/ Associates/Joint Ventures.

29. Secretarial Standards

The Company has duly complied with the applicable Secretarial Standards as required by the Companies Act, 2013.

30. General

The Company has not issued equity shares with differential voting rights or sweat equity shares, there is no reportable event with respect to one time settlement with any Bank or Financial Institution and no corporate insolvency resolution process was initiated under the Insolvency and Bankruptcy Code, 2016, either by or against the Company, before National Company Law Tribunal.

31. Change in Nature of Business

There has been no change in the nature of business during the financial year under review.

32. Acknowledgement

The Directors thank all Customers, Vendors, Banks, State Governments and Investors for their continued support to your Company's performance and growth. The Directors also wish to place on record their appreciation of the contribution made by all the employees of the Company in delivering the good performance during the year.

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