nocil ltd Directors report

Dear Members,

Your Board of Directors are pleased to present their Board Report together with the Audited Financial Statements of the Company for the financial year ended March 31, 2023.

Financial Summary

Particulars	Financial year ended March 31, 2023	Financial year ended March 31, 2022
Total Revenue	161,657	157,131
Profit before Interest,	25,628	28,774
Depreciation & Tax
Less: Interest	119	107
Less: Depreciation	5,439	4,708
Profit before tax	20,070	23,959
Less: Tax Expenses	5,202	6,364
Net Profit after tax	14,868	17,595
Earnings per share of face value of 10 each -Basic	8.92	10.57
Earnings per share of face value of 10 each	8.89	10.54
-diluted

Performance of the Company

The year under review was marked with global recessionary trends and inflationary pressures across major economies of the world having its impact on the manufacturing sector.

While the first quarter of the year began with the quarterly volumes and revenues, the impact of the slowdown in the global markets was experienced by your Company in the subsequent quarters. The second and third quarters were marked with a sharp de-growth. We witnessed some recovery in the fourth quarter albeit continued recessionary fears. On an annual basis, the sales volumes drop was restricted to 4% as compared to the previous year, primarily due to de-growth in international markets.

The Board of Directors wish to inform you that, despite dip in volumes, your Company recorded turnover of 161,657 Lakhs for the year as against 157,131 Lakhs, a growth of around 3%. This was on the back of de-growth in sales volume for the year under review offset by price increases of over 7%.

Your Company continues to practice its ethical business strategy and all customers were served in a timely manner with the best quality and services.

Domestic Market

Your Company recorded a Net Domestic turnover of 111,947 Lakhs for the year under review registering a growth of around 13%. On the volumes front, as against the domestic rubber consumption growth of 4.8% for calendar year 2022, your Companys domestic business registered a growth of over 6%. Positive interactions with the customers coupled with continued Tire import restrictions in India were the key contributors in enabling the Company to register a moderate growth. Further, prices of key products were adjusted for change in the input costs thereby contributing by 7% improvement to revenues.

China being the largest manufacturer and market for rubber chemicals accounts for about 80% of worlds rubber chemical production and consumes about 35% of the rubber chemicals, resulting in exportable surplus. USA though, the 2nd largest market continues with its sanctions against Chinese imports of rubber chemicals. Being the third largest market for rubber chemicals, India is more susceptible to Chinese aggressive dumping. In view of the prevailing recessionary trends, any underutilisation at the Chinese competitors end may lead to aggravated dumping in the nearby markets.

Despite short-term challenges, the +1 strategy continues to be an important differentiator for your Company when our customers look for security of supply chain from a medium to long term time. ever

Exports

For the year under review, Exports showed a volume de-growth of 21%. This was largely on the back of the global slow down especially in Europe and significantly lower production in the latex market of South-East Asia. While we tried to maintain our prices in the first half of the year resulting in sacrifice of volumes, we were forced to resort to some price aggression during the second half of the year to regain the volumes.

On the revenue front, we recorded a turnover of 49,130 Lakhs as against 56,755 Lakhs thereby registering a drop of 13%. Global customers continue to value the strengths and capabilities of your Company. The coming on-stream of its recent capacities and gaining of approvals, will enable your its long- Company to leverage growth opportunities to fulfil term vision of doubling its market share in the global space.

Operations

As stated earlier, the production of all products was aligned with the marketing conditions prevalent due to this slowdown during larger part of the year.

On the input front, for most part of the year, the prices were relatively flattish with some corrections in a few key raw materials. We continue to build stronger association with local suppliers/ developing new suppliers to help secure volumes with some cost advantages and lower lead time. Utilities costs increased due to higher energy costs which prevailed throughout the year as compared to the second half of the previous year.

Projects

There are a few ongoing capital expenditures regarding environmental aspects as well as some de-bottlenecking initiatives taken by your Company. We have capitalised such initiatives of 1,970 Lakhs during the financial year 2022

23 and expect to complete few other projects in the next financial year. w on account of dividend

The de-bottlenecking capex comes with an advantage of low-cost capex with a potential of 5%-10% additional capacities which will be sufficient to meet the additional demand in the medium term.

To achieve its long-term goal your Company is currently evaluating various growth options for its expansion and shall be appropriately communicated, once approved by the Board.

Finance Rating

During the year under review, your Company has judiciously utilised its resources and consequently, generated cash profitsfor the whole year and thus was not required to utilise any fund based working capital facilities for most part of the year. The Company continues to remain debt free.

The Credit Rating Agencies CARE and CRISIL Limited have reaffirmed ratings as CARE AA (Double A) (Stable)

CRISIL AA for long term Bank Facilities (Term loan as well as Fund Based facilities) and CARE A1+ (A One plus) and CRISIL A1+ (stable) rating for short term Non-Fund Bank facilities, respectively.

Dividend Policy

In terms of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 as amended, the Board of Directors have duly approved and adopted a Dividend Distribution Policy attached as Annexure "G". The said Policy is also available on the Companys website, the weblink of which is as under: https://www.nocil.com/images/fckeditor/file/Dividend-Distribution-Policy-2018.pdf

Dividend Pay-out

The Board of Directors at their meeting held on May 29, 2023 recommended a dividend of 3 per Equity share of the face value of 10/- each to be paid to those shareholders whose names appear in the Register of Members of the Company or in the records of Depositories as beneficial owners of

Equity Shares as on July 24, 2023.

This is subject to approval of the approval of the shareholders at the forthcoming 61^st Annual General Meeting convened onJuly31,2023.Thecash 47

(if approved) will involve a sum of 4,999 Lakhs (Previous year

4,998 Lakhs) which will be utilised from the Free Reserves prevailing as on the date of the 61^st Annual General Meeting.

Transfer of Unpaid Dividend and corresponding Equity Shares to the Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules"), all unpaid or unclaimed dividends are required to transferred by the Company to the Investor Education Protection Fund (IEPF); established by the Government of India, after completion of seven years from the date it became due for payment. Further, according to the IEPF Rules, the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account of the IEPF Authority. The total amount lying in the Unclaimed Dividend Account of the Company as on March 31, 2023 in respect of the last seven years from 2015-16 to 2021-22 is 381 Lakhs. During the year under review, all unclaimed / unpaid dividends up to 2014-15 amounting to 35 Lakhs have been transferred to the Investor Education and Protection Fund and the unclaimed / un-encashed dividends for the 2015-16 paid on July 27, 2016 are due for transfer to IEPF on September 2, 2023. As per the IEPF Rules, as amended, the due date for transfer of Equity Shares in respect of Dividend pertaining to the Financial Year 2014-15 was August 29, 2022. The Company had intimated individually to concerned shareholders and published necessary notices in the newspapers intimating the shareholders about the impending transfer and the procedure for claiming the same.

In compliance with the Amended Rules, during the year, the Company has transferred 1,00,697 Equity shares to the designated demat account opened by IEPF Authority with NSDL through Punjab National Bank, belonging to those shareholders holding shares both in dematerialised form as well as physical form, who had not encashed their Dividend for a period of 7 years or more beginning from the Financial Year 2014-15. The shares held in demat / physical mode were transferred during September 2022.

The Company has also uploaded the details of the shareholders whose shares were liable to be transferred to IEPF on its website viz., www.nocil.com.

The nodal officer for the purpose of IEPF is Mr. Amit K. Vyas,

Assistant Vice-President (Legal) & Company Secretary of the Company. The details of the same are mentioned on the website of the Company. The web link is as under http://www.nocil.com/detail/investors/transfer-of-unclaimed-shares-to-iepf/75

Fixed Deposits

Your Company does not accept deposits from public, and hence there are no outstanding/unclaimed deposits as of March 31, 2023.

Insurance

The Company has taken all the necessary steps to insure its properties and insurable interests, as deemed appropriate and as required under the various legislative enactments. There were no major incidents or accidents to warrant Insurance claims during the year under review.

Health, Safety and Environment (HSE)

Health, Safety and Environment form a core theme for long term sustainability of your Company. HSE is an essential feature of your Companys business module which ensures clean environment and safety of all employees, community around all manufacturing locations and all the stakeholders. High emphasis is placed on laid down policies, systems and procedures, collective learning, and continuous improvement by encouraging all employees including contract employees to report No Near Miss Accidents."Safe Attitude Encouragement" is a humane interactive approach, which is initiated by the Senior Management on a weekly basis to strengthen the safety culture of your organisation. Management of process safety is an essential part of risk assessment and even the smallest change incorporated at the Plants undergoes risk assessment study before implementation. Extensive process safety is incorporated through automatic control system, and training is imparted to all the concerned employees.

Work areas are regularly monitored to check the concentration of chemicals, noise level, illumination, and quality of ambient air to ensure safe and healthy work environment. Safe practices in the Company are encouraged by conducting various annual competitions and rewarding the employees for proposing novel safety messages. Mitigation Actions are undertaken through weekly planned emergency drills to train the employees for systematic communication and planned actions. Your Company is also a member of ‘mutual aid group in which all the neighbouring industries participate in the mock drills to ensure all time preparedness for emergencies.

The Research Centre of your Company has a core team which focuses on developing and implementing the technologies ensuring continuous improvement in the environment standards of all manufacturing locations. Highest emphasis is placed on the environment standards by your Company management and substantial capital expenditure is allocated to implement new technologies developed by the Research Centre.

Conservation of natural resources is a major initiative as a part of HSE. Capital expenditure and is encouraged and reviewed periodically by the Board of your Company to ensure continuous reduction in consumption of natural resources. Your Company has occupational health centres at all locations which not only undertake the mandatory periodical health check-ups of employees but also counsel the employees on the lifestyle health hazards. Based on the health statistics of the community, collective counselling by experts is organised to increase the health awareness of employees.

HSE performance of your Company is reviewed by the Board every quarter and valuable suggestions by the Board members are incorporated in policies/ work practices to further strengthen the HSE standards of the Company. Your Company is a Responsible Care logo holder, which ensures continuous improvements in the areas of environmental protection, health, safety, and secured transportation of raw materials and finished products.

Implementation of Responsible Care guiding principles systematically ensures the highest standards of HSE in the Company and the periodic audits assesses continuous improvement.

We have very well laid down policies, procedures, practices, and systems in place for Health, Safety and Environment related issues. Necessary training inputs are provided to all the employees, including contract employees and strict adherence to the protocols are monitored through regular auditing, reporting of incidences and timely preventive and corrective measures leading to continuous improvements. Safe practices are encouraged by conducting various annual competitions and rewarding the employees.

Regular workplace monitoring is carried out for Volatile Organic Compounds (VOC), Noise and Illumination levels, Ambient air quality etc. to ensure safe and healthy work environment. Weekly firefighting drills and half yearly Disaster

Management Plan drills are conducted to prepare the internal firefighting teams to be in readiness at all the time.

Process Safety Measures are given highest priority and laid down Pre-Start Up Safety Review (PSSR) procedures are followed before starting up of Plant operations. Similar procedures are followed for Plant shutdowns and stoppages. Process Safety issues are thoroughly analysed using HAZOP/

HAZAN / LOPA techniques and findings are implemented.

Your Company endeavours to not only meet the prescribed environmental standards but also strives to implement innovative technologies which encompasses Green Chemistry. Your Companys research Centre has an exclusive team focusing on environmental research and Green Chemistry. Your Company focuses on strategies to reduce consumption of natural resources like electricity and water. Your Company will continue to assume the role of responsible citizen and adopt and implement strategies to meet the climate change challenges.

Total Quality Management (TQM)

Your Company continues to follow Total Quality Management (TQM) practices. It is a continuous effort by the management as well as employees to ensure long term customer loyalty and customer satisfaction. TQM initiatives by your Company improve competitiveness of the business and is one of the prime enablers for growth.

TQM in your Company ensures that all associated employees work towards common goals of improving product and service quality, as well as improving the procedures that are in place for production. TQM ensures high customer focus and consistently meeting customer expectations across the organisation. TQM is an integral part of the business from sourcing of inputs to meeting the customers needs. Your Company has over the years established management systems and processes in line with global business standards at each step and build on continual improvement recommendations emanating from various audits by customers and certifying agencies.

Your Company is certified for ISO 9001:2015 (Quality

Management System), ISO 14001: 2015 (Environment Management System), ISO 45001: 2018 (Occupational Health & Safety Management System), IATF 19949:2016 (Automotive Quality Management System) and ISO 50001: 2018 (Energy Management System).

Your Company is amongst the select 83 companies in India which are certifiedfor Responsible Care. Whichis the Global Chemical Industrys Environmental, Health and Safety (EHS) initiative to drive continuous improvement in performance. Through this initiative the Companies achieve the objective of going beyond legislative and regulatory compliance. Your Company enjoys the privilege of using the Responsible Care logo.

Your Company has adopted "5 S – Workplace organisation method" to decrease waste while optimising productivity through maintaining an orderly workplace and using visual cues to attain more consistent operational performance. Quality Assurance and Marketing Technical Service laboratories at Navi Mumbai location are accredited as per

ISO 17025:2017 which increases customer confidence in our test certificates.

Your Company has been awarded a ‘Silver medal‘ for 2023 by EcoVadis (EcoVadis is the worlds most trusted provider of Business Sustainability ratings) which demonstrates the Companys core strength as a ‘sustainable supplier giving it a competitive edge for Global business. Your Company meets elements and practices of ESG (Environment, Social & Governance) guiding principles and all initiatives in this regard together with the associated risks are periodically reviewed by the Risk Management Committee of the Board as a part of Enterprise Risk.

Integration of Environmental, Social & Governance (ESG) principles Adoption of the ESG Charter & way forward towards Sustainability

The Board of Directors have adopted an ESG Charter which outlines the Companys vision, objectives, management system and governance controls for efficient integration

Environmental, Social and Governance (ESG) principles. Your Company acknowledges that all its stakeholders can have an impact on the environment and community. Therefore, the Company comprehends and endorses the need for adherence to ESG policies consistent with its values by all associated parties and stakeholders. Your Company intends to integrate ESG parameters in its operations to leverage any potential opportunities on account of better environmental management, social performance, and improved governance principles. Committed to continuous progress on the ESG initiatives, the ESG Charter is prepared to assist the Board and Management in its oversight related to issues such as Climate Change Crisis, Protection of Human Rights, DE&I, Occupational Health & Safety, and other ESG issues that are relevant and material to the Company. In order to facilitate a smooth transition into the ESG journey, the ESG Charter provides guidance to the organisation on matters that help create a robust ESG approach.

This ESG Charter is designed in line with the SEBI (Listing Obligation and Disclosure Requirements) Regulations as amended on May 5, 2021, the BRSR framework dated May 10, 2021 and the UN Sustainable Development Goals 2015.

The ESG Charter has been uploaded on the Companys website. The link for accessing the said Charter is given here below: https://www.nocil.com/images/fckeditor/file/ESG%20 Charter%20Nocil%20Ltd..pdf

The Business Responsibility and Sustainability Report (BRSR)

SEBI has introduced a host of regulations, including the shift from ‘Business Responsibility Report (BRR) to ‘Business Responsibility and Sustainability Report (BRSR), thereby requiring listed companies to disclose the financial implications as well as plans to mitigate or adapt to ESG risks. With effect from the financial year 2022-2023, filing of

BRSR shall be mandatory for the top 1000 listed companies (by market capitalisation) and shall replace the existing BRR in the Annual Report. Your Company is listed on BSE

& NSE and falls within the list of top 1000 companies and hence is mandatorily required to include the BRSR in the Annual Report to the shareholders for the F.Y. 2022-23 The Business Responsibility and Sustainability Report

(BRSR) is a torch bearing step towards achieving

Sustainability.TheBRSRisabigstartingpointasitmandates disclosures on material ESG risks and opportunities and their financial implications and risk management . The BRSR seeks disclosures from listed entities on their performance against the Nine (9) Principles of the ‘National Guidelines on Responsible Business Conduct (NGBRCs) and reporting under each principle is divided into essential and leadership indicators.

The BRSR is intended towards having quantitative and standardised disclosures on ESG parameters to enable comparability across Companies, Sectors, and time.

The Business Responsibility & Sustainability Report is provided in a separate section and forms part of the Annual Report.

Independent Assurance Assessment (Non financial parameters) conducted by Bureau Veritas in respect of BRSR (2022-23). NOCILs commitment to integrate the Environmental. Social & Governance (ESG) parameters in its operations to leverage potential opportunities with astute environment management, social performance and best governance practices is further affirmed by

Independent Assurance Assessment of its BRSR conducted by Bureau Veritas (India) Pvt Ltd (Bureau Veritas). The said assessment statement has surmised as under :

 

"On the basis of our methodology and the activities described above, it is our opinion that the BRSR for 2022-23 of "NOCIL", containing its reporting and declaration of the various ESG parameters from the operations within the reporting boundary and the reporting period, as described above, is prepared in all material respects in line with the applicable criteria here before stated. The reviewed statements within the scope of our verification are transparent and the information included therein are fairly stated".

Research & Development

The vision of "The Research & Development" (R&D) centre of your Company is to develop innovative & sustainable process technologies for manufacture of rubber chemicals with focus on current and emerging needs of Customers. The major focus of R&D centre is to develop cost-effective, competitive, environmental benign and safe manufacturing processes. R&D Scientists, Chemists & Engineers/ Technologists of your Company are making relentless efforts in developing innovative technologies to fulfil companys vision to be a World Class, Customer Focussed, Innovative Organisation in the field of Rubber Chemicals.

The R&D centre of the Company has been recognised by the

Department of Scientificand Industrial Research, Ministry of

Science & Technology, Govt of India and is also very actively involved in collaborative research work with Indias premier

Industrial research institutes (Council for Scientific and

Industrial Research-National Environmental Engineering Research Institute (CSIR-NEERI)) & Academic Institutions (Institute of Chemical Technology, Mumbai & Indian Institute of Technology, Madras) for exploring research in newer domain & new generation technologies. Recently, Risk Indian

Chemical Council has conferred your Company with the prestigious ICC K. V. MARIWALA award for the effective

Chemical Industry–Academia Partnership, in collaboration with Institute of Chemical Technology, Mumbai.

Your Companys R & D centre focus on the following key areas:

Continuous improvements of current manufacturing processes to enhance production capacity in the existing Plant setup by process de-bottlenecking to reduce cost.

Development of greener process technologies for existing products to improve process efficiencies in terms of reduction of raw material & energy consumption by modifying process in line with Green Chemistry principles to improve atom economy and reduction of carbon & water footprint in manufacturing processes.

To develop environmental strategies and process technologies, in line with the current and future sustainability needs. Implementation of 3R (Reduce, Reuse & Recycle) strategies for recovery of raw materials & intermediates from the manufacturing process streams.

Continuous assessment of new generation technologies and evaluation of their adoptability for product and process improvements.

Development of niche Products and Intermediates as per customer needs by exploring innovative chemistry & advanced technologies and also in other adjacent segments.

Continuous efforts of R &D team in above key areas resulted in an increase in production capacity, reduction in raw material usage, reduction in carbon and water footprint in the manufacturing processes and helped in developing improved and safer process technologies. Your Companys top management is actively involved in providing necessary resources to strengthen R&D Infrastructure, to make R&D centre with start-of-art facilities for rubber chemicals research. Your Companys R & D team is very enthusiastic to work on innovative technologies for long-term business sustainability in rubber chemicals and, exploring new business segments.

Risk Assessment and Management

Your Company has a well-defined

System in place, as a part of its good Corporate Governance practices. Your Company considers Risk Management to be fundamental to good management practice and a significant aspect of corporate governance. Effective management of Risk has enabled the Company to minimise the adverse effects of such Risks encountered from time to time thereby ensuring that the achievement of the Companys strategic and operational objectives is not significantly altered. The purpose is to identify and review past events / incidents and implement changes to prevent or reduce future undesirable incidents. Considering the multitude of Risks faced by the Company, Risk management has emerged as a very important function of the Board. your Company aims to use Risk Management to take better informed decisions and improve the performance thereby achieving its strategic and operational objectives. To address any risk factors that may arise on account of the regulatory changes/amendments as applicable to the Company are being followed and monitored closely. The Company has adopted a Risk Management Policy (the Policy) and formed a Risk Management Committee (the Committee) in accordance with the provisions of the Act and Regulation 21 of the SEBI (LODR) Regulations, 2015. In terms of the Policy the Committee reviews on a periodic the Risks relating to ‘Enterprise Risk Management (ERP) – Sustainability, ‘Business Continuity Process Technology Updates, ‘Competitor Action Plans, ‘Cyber/I/T Related Risks, ‘Forex Risks, ‘Legal & Statutory Compliances, ‘Human Capital and Succession Planning, ‘Exploration of diversification opportunities in related areas of strength from time to time to ensure that business vulnerabilities are not dependent on a single segment, ‘Investment Proposals under implementation and to take corrective action wherever necessary to minimise time and/or cost overruns.

Your Company has also appointed a Chief Risk Officer (CRO) who is a dedicated functionary conversant with the intricacies of business operations and the associated risksaudit for ensuring control and monitoring of the implementation of the Policy. The CRO does not simultaneously hold or lead any specialised full-fledged function which would result in conflict with his role as CRO. The composition of the RMC, its terms of reference and number of Committee meetings held during the year are given in the Corporate Governance Report. Group/Function Heads who own the allocated risks are invited to the Committee meetings for presentations highlighting the measures taken towards handling the risks. The Board also reviews on a quarterly basis a Risk Assessment Statement which captures the overall assessment, control assessment and responsibility with a rating on a scale of 1 to 5, in respect of Handling of Hazardous materials, Regulatory compliance, Power outages, Volatility issues that can impair the financialof availability and Process of raw materials, Equipment failure risk of flooding of Plants during Monsoon, Patent infringement, Adverse changes in Global /National economic and political scenarios, Logistic disruptions, Frauds, Inadequate I.T support, Non amicable labour relations etc The Risk Management Policy has been uploaded on the Companys website. The link for accessing the said Policy is given here below: https://www.nocil.com/images/fckeditor/file/NOCIL%20 RISK%20MANAGEMENT%20POLICY.pdf

Internal Control Systems and their Adequacy

Adequate internal controls, systems, and checks are in place, commensurate with the size of the Company and the nature of its business. The management exercises financial control on the Companys operations through a well-defined budget monitoring process and specifying standard operating procedures. Your Company has appointed an external professional agency M/s. Aneja Associates, Chartered Accountants, to conduct the internal audit, and the findings and recommendations of the Internal Auditors are placed before the Audit Committee of your Board periodically.

The Internal Auditors monitor and evaluate the efficacy and adequacy of internal controls in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal auditors, the management undertakes corrective action in the respective areas and thereby further strengthens the controls. Significant and corrective actions thereon are presented to the Audit Committee of the Board. The Audit committee of the Board ensures that necessary corrective actions suggested are put in place. In addition, during the year under report, the Audit

Committee and the Board have specifically reviewed the

Internal Financial Controls with reference to the Financial Statements and process prevalent in the Company. On a case-to-case basis, the Board also engages the services of professional experts in the said field, to ensure that adequate financial controls and systems are in place. At the end of a period, the Managing Director, and the Chief

Financial Officer (CFO) give a declaration in the prescribed format to certify that the financial statements prepared are accurate and complete in all aspects and that there are no significant of the Company.

Vigil Mechanism / Whistle Blower Policy

Your Company has adopted an Ethical Code of Conduct for ensuring the highest degree of transparency, accountability, integrity, and social responsibility. Any potential or actual violation of the Code is viewed very seriously by the Company and disciplinary action is taken thereon. The Company has formulated a Vigil Mechanism & Whistle Blowing Policy as part of the Ethical Code of Conduct, which lays down a mechanism for reporting of any instances of frauds, unethical conduct, conflict of interests, non-compliance with legal provisions, misuse of companys assets or funds, falsification of records/accounts, Misuse of Unpublished

Price sensitive information viz Insider Trading, Instances of discrimination or unfair labour practices, engagement of Child labour etc.

All employees have been sensitised about the mechanism of the said Policy and the Company intends to hold training programmes on a continual basis to encourage reporting of any such instances of violation of its Ethical Code.

There has been a change in the said Policy during the financialyear. and necessary amendments to the policy have been carried out in line with the regulatory requirements.

There have been no instances of Whistle blowing during the year under review.

This Policy has been uploaded on the website of the Company and the link for accessing the same is given below: https://www.nocil.com/images/fckeditor/file/Vigil_ Mechanism_Whistle_Blower_Policy.pdf

Policy on Prevention of Sexual Harassment of Women at Workplace year under review as per the details stated in

Your Company is an equal employment opportunity Company and is committed to creating a healthy and safe working environment that enables Employees, Agents, Contractors, Vendors and Partners to work without fear of prejudice, gender bias and sexual harassment. The Company also believes that all employees have the right to be treated with dignity. Sexual harassment at the workplace or other than workplace if involving employees is a grave offence and is, therefore, punishable. The Company has therefore adopted and implemented a ‘Policy on Prevention of Sexual Harassment‘ (POSH Policy) with the objective to provide protection against the sexual harassment of women at workplace and for prevention and redressal of complaints of sexual harassment and for matters connected therewith. This Policy is subject to and in pursuance of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)year Act, 2013 under review and the as per the Rules framed there under. In accordance with the said Act and the POSH

Policy, the Company has formed an Internal Committee to manage the process of enquiry and redressal of complaints. The Company is holding training programmes for all the employees (whether on regular or on contracts and whether permanent or temporary) across its Plants, Head the Regional Offices to sensitise and educate them about the acceptable and non-acceptable behaviour with respect to female employees. The Company has translated the POSH Policy into vernacular languages (commonly spoken and understood at its Plants and Offices) and circulated the same over mail and through hand delivery to each of such employees to ensure that there remains no ambiguity or confusion about the subject. During the year under review, no complaints were received under POSH. This Policy has been uploaded on the Companys website and is accessible on the below link: https://www.nocil.com/images/fckeditor/file/Policy%20 on%20Prevention%20of%20Sexual%20Harrasment.pdf

Number of Board Meetings

The Board of Directors met six (6) times during the financial year under review as per details stated in the Corporate Governance Report.

Details of Committee Meetings Audit Committee Meeting

The members of Audit Committee met four (4) times during the financial the Corporate Governance report.

Nomination & Remuneration Committee Meeting

The members of Nomination & Remuneration Committee met two (2) times during the financial year under review as per the details stated in the Corporate Governance report.

Stakeholders Relationship and Investors Grievance Committee

The members of Stakeholders Relationship and Investors

Grievance Committee met once during the financial year under review as per the details stated in the Corporate Governance report.

Risk Management Committee

The members of Risk Management Committee met four

(4) times during the financial details stated in the Corporate Governance report.

Corporate Social Responsibility Committee

The members of Corporate Social Responsibility Committee met three (3) times during the financial year under review as per the details stated in the Corporate Governance report.

Composition of Audit Committee:

The total strength of the Audit Committee is 5 Directors all of whom are Independent. The norms require at least 2/3rd of the members to be Independent Directors.

The composition of the Audit Committee is given below:

Name of Members	Category
Mr. D.N. Mungale – Chairman	Independent Director
Mr. Rohit Arora	Independent Director
Mr. Vilas R. Gupte	Independent Director
Mr. P. V. Bhide	Independent Director
Mr. Debnarayan Bhattacharya	Independent Director

During the year under review, all the recommendations made by the Audit Committee were accepted by the Board.

Board Evaluation

Pursuant to the applicable provisions of the Companies Act, 2013, as amended from time to time and Regulations 17 and 25 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, of individual Directors as well as the evaluation of the working of its Audit, Nomination & Remuneration, and other Committees. The various criteria considered for evaluation of Whole Time / Executive Directors included qualification, experience, knowledge, commitment, integrity, leadership, engagement, transparency, analysis, decision making, governance etc. The Board commended the valuable contributions and the guidance provided by each Director in achieving the desired levels of growth. This is in addition to evaluation of Non-Independent Directors and the Board as a whole by the Independent Directors at their separate meeting being held every year.

Declaration by Independent Directors

As required under Section 149(7) of the Companies Act, 2013, read with SEBI (Listing Obligations and Disclosure Requirements), (Amendment) Regulations, 2018, the Independent Directors have placed the necessary declaration of their independence in terms of the conditions laid down under Section 149(6) of the Companies Act, 2013, as amended, at the Board Meeting held on Monday, May 29, 2023. Further, pursuant to the Companies (Appointment and Qualification of Directors), Rules, 2014 as amended, the said declaration also includes a confirmation to the effect that the Independent Directors have included their names in the Database maintained by the Indian Institute of Corporate Affairs, and they have paid the necessary fees for the said registration.

Familiarisation Programme to Independent Directors

The Company provides suitable familiarisation programme to Independent Directors to help them familiarise themselves with the nature of the industry in which the Company operates and the business model of the Company in addition to regular presentation on expansion plans and their updates, technical operations, marketing and exports and financial statements.

In addition to the above, Directors are periodically advised about the changes effected in the Corporate Law, Listing Regulations about their roles, rights, and responsibilities as Directors of the Company. There is a regular interaction of Directors with the Key Management Personnel of the Company. The details of the familiarisation programme have been disclosed and updated from time to time on the Companys website and its https://www.nocil.com/images/ fckeditor/file/Familiarization-Programme-for-IDS.pdf

Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3)(c) of the Companies Act, 2013:

(a) That in the preparation of the annual financial statements for the year ended March 31, 2023, the Indian Accounting Standards (Ind AS), the provisions of the Companies Act, 2013, as applicable and guidelines issued by the Securities and Exchange Board of India (SEBI) have been followed along with proper explanations relating to material departures, if any.

(b) That such accounting policies as mentioned in Note 1 forming part of the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent to give a true and fair view of state of affairs of the Company as of March 31, 2023.

(c) That proper and 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) That the annual financial statements prepared on a going concern basis.

(e) That proper internal financial controls were and that the financial controls were adequate and were operating effectively.

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

(g) That all the applicable Secretarial Standards have been complied with by the Company during the year under review.

The above assessment of the Board was further strengthened by periodic review of internal controls by both internal as well as external auditors.

Remuneration policy

The Company has amended the Remuneration Policy as per recommendation of the Nomination and Remuneration Committee. The weblink of the Policy is: h t t p s : / / w w w. n o c i l . c o m / i m a g e s / f c ke d i t o r / f i l e / Remuneration-Policy.pdf

Related Party Transactions

All related party transactions that were entered into during the financial year were at an arms length basis and were in the ordinary course of business. There are no materially significant with Promoters, Directors, and Key Managerial Personnel, wholly owned subsidiary company or other designated persons which may have a potential conflict with the interest of the Company at large except as stated in the Financial Statements / Directors Report.

As per the Related Party Transactions Policy, approved by the Board of Directors of the Company, during the year under review, the Company has entered into related party transactions based upon the omnibus approval granted by the Audit Committee. The Audit Committee reviewed such transactions on quarterly basis for which omnibus approval was given.

Particulars of contracts or arrangements with related partiescare has been taken for as referred to in Section 188(1) of the Companies Act, 2013 along with the disclosures as mentioned in Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in the prescribed form AOC-2 for 2022-have 23 are given inbeen Annexure "F".

The current Related Party transactions (RPT)policy has in place been uploaded on the Companys website and the weblink of the Policy is as under: http://www.nocil.com/images/fckeditor/file/Policy-on-Related-Party-Transaction.pdf

Loans, Guarantees or Investments

Particulars of loans, guarantees or investments under Section 186 of the Companies Act, 2013, are given in the Notes forming part of Financial Statements for the year ended March 31, 2023.

Extract of Annual Return

Extract of Annual Return for the Financial Year ended March 31, 2023 as required by Section 92 (3) of the Companies Act 2013. The weblink of the same is https://www.nocil.com/ images/fckeditor/file/Annual-Return-2022-23.pdf

Subsidiary Company, Associates and Joint Ventures

PIL Chemicals Limited, (PIL), a Wholly Owned Subsidiary (WOS) of your Company has recorded a Total Income of

2,108 Lakhs and Profit before Tax of 308 Lakhs, for the year under review. The Board of Directors of PIL declared a total Dividend of 1.45/-per share. (Previous year Dividend was

1.20/- per share).

The Company does not have any material subsidiary, however, the Company has formulated a policy for determining material subsidiary(ies) and such policy has been disclosed on the Companys website and its weblink is https://www.nocil.com/images/fckeditor/file/Policy-on-

Material-Subsidiaries.pdf

Pursuant to the requirements of Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the details of Loans / Advances made to, and investments made in the subsidiary have been furnished in Notes forming part of the Accounts.

A statements containing the salient features of the financial statement of the Companys wholly owned subsidiary under the provisions of section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 has been annexed in prescribed Form AOC -1.

Further, the Company does not have any joint venture or associate companies during the year or at any time after the closure of the year and till the date of the report.

Consolidated Financial Statements

Consolidated Financial Statements are prepared by the CompanyinaccordancewiththeapplicableIndianAccounting Standards (Ind AS) issued by the Ministry of Corporate Affairs and the same together with Auditors Report thereon form part of the Annual Report. The financial statements have been prepared as per Division II of Schedule III issued by the Ministry of Corporate Affairs vide its Notification dated April 6, 2016 as amended from time to time.

Personnel

The relations, during the year, between the employees and the management of your Company continued to be cordial. Your Directors wish to thank all the employees for their continued support and co-operation during the year under review.

Stock Options

In terms of your approval, read with the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, the details required to be provided under the said Guidelines set out in Annexure "C" to this Report.

Particulars of Employees

The information required under section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 in respect of employees of the Company is provided in Annexure "E".

Appointment/Reappointment of Directors and Key Managerial Personnel - Appointment of Mr. Anand V.S. as the Managing Director

During the year under review Mr. A. Vellayan has been appointed as an Independent Director for a period of 5 years with effect from November 8, 2022. Mr Vellayans appointment has been approved by the shareholders by passing Special resolution (through postal ballot) on December 28, 2022.

Mr. Sudhir R. Deos term as the Managing Director comes to an end on July 31, 2023 and hence based on the recommendations of the Nomination & Remuneration Committee and the Board as well, it is proposed to appoint Mr. Anand V.S. as the Managing Director of the Company for a period of 5 years w.e.f August 1, 2023 up to July 31, 2028 as a part of succession planning so as to take over the mantle from Mr. Sudhir R. Deo. Mr. Anand V. S. was appointed as the Deputy Managing Director of the Company for a period of 5 years with effect from March 2, 2022 to March 1, 2027 by way of an Ordinary Resolution through the mechanism of the Postal Ballot.

The Board wishes to place on record its deep appreciation and gratitude for the extraordinary contributions made by

Mr. Sudhir R. Deo during his 43 years of association with the Arvind Mafatlal Group (AMG). As the Managing Director of NOCIL from August 1, 2017 till July 31, 2023, Mr. Deos integrity, astuteness, astounding technological knowledge and above all, his sensitivity and sense of fairness in motivating people from grassroots level upwards, has taken the company to another level thus preparing it adequately to meet both future challenges and the exciting growth prospects that lie ahead. One of his biggest lasting achievements will be his leadership of the strong multi-disciplinary team which he created for successfully setting up a greenfield project at Dahej. The critical products were developed with entirely indigenous technology and have proven to be world-class. The Company embarked on the largest growth in its history under his stewardship, while still maintaining a zero-debt status for the last 6 years. The Board wishes him a happy retired life and good health. There has been no other change in Key Managerial Personnel of the Company during the year.

Directors

Pursuant to Section 152(6) of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Priyavrata H Mafatlal Non -Executive Director retires by rotation at the forthcoming 61^st Annual General Meeting. Being eligible, he has offered himself for re-appointment.

Statutory Auditors

Pursuant to the requirements of Section 139(1) and 139(2) of the Companies Act, 2013, at the Annual General Meeting held on July 28, 2022, the Members had accorded their approval for the Re-appointment of M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants, Mumbai as the Statutory

Auditors for the second and finalterm of the Company to examine and audit the accounts of the Company for the

Financial Years 2022-23 to 2026-27. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules. As required under Regulation 33(1) (d) of the SEBI (Listing Obligations and Disclosure Requirements),

Regulations, 2015, the Auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. The amended provision of Section 139(1) of the Companies Act,

2013, has dispensed with the ratification of appointment of

Statutory Auditors each year by the Members.

Explanations or comments on the qualification, reservation, adverse remark, or disclaimer made by the Statutory Auditors or by Company Secretary in practice in their report.

During the year under review, there are no qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors appointed under section 139 of the Companies Act, 2013. Hence, the need for explanation or comments by the Board does not arise. The report of the

Statutory Auditor forms a part of the financial statements.

During the year under review, no material or serious instances of fraud falling within the purview of Section 143 (12) of the Companies Act, 2013 and Rules made there under, by officersor employees were

Statutory Auditors of the Company during the course of the audit conducted and therefore no details are required to be disclosed under Section 134 (3) (ca) of the Act.

Cost Auditors

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Cost Audit records maintained by the Company are required to be audited.

M/s. Kishore Bhatia & Associates, Cost Auditors have given a Certificate to the effect that the appointment, if made, will be within the prescribed limits specified under section 141 of the Companies Act, 2013.

The Audit Committee has obtained a certificate from the

Cost Auditor certifying their independence and arms length relationship with the Company. The Cost Audit Report in respect of F.Y. 2021-22 was filed on October 4, 2022 and the Report for the Financial Year 2022-23 will be filed within the time limit as prescribed under the Companies (Cost Records and Audit), Rules, 2014.

Your Directors, on the recommendation of the Audit Committee, appointed M/s Kishore Bhatia & Associates to audit the cost accounts of the Company for the financial year 2023-24 on a remuneration of 8.00 Lakhs.

AsrequiredundertheCompaniesAct,2013,theremuneration payable to the cost auditor is placed before the Members at their 61^st Annual General Meeting for their ratification.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors at its meeting held on July 28, 2022 appointed M/s. Parikh & Associates., Company

Secretaries, a firm of Company Secretaries in Practice as

Secretarial Auditor to carry out the Secretarial Audit of the Company for 2022-23. The Report of the Secretarial Audit is annexed herewith as Annexure "B".

The Secretarial Audit Report does not contain any qualifications, reservations or adverse remarks or disclaimer.

Further, PIL Chemicals Limited, is the only wholly owned reported by the subsidiary of the Company and is not a material unlisted subsidiary. Therefore, the provisions regarding the Secretarial Audit as mentioned in Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements), 2015 as amended, do not apply to PIL Chemicals Limited.

Report on Corporate Governance

As per Regulation 34 read with Schedule V (C) of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, a separate section on Report on Corporate Governance practices followed by the Company, together with a certificate received from the Companys Secretarial Auditor confirming compliance is attached.

Report on Management Discussion and Analysis

As required under Regulation 34 read with Schedule V (B) of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, a report on "Management Discussion and Analysis" is attached and forms a part of this Report.

Corporate Social Responsibility

Your Company treats CSR as "More than an obligation, more than a duty". As a part of the Arvind Mafatlal Group, the Company firmly believes that discharge of Corporate

Social Responsibility in itself is a feeling that the Company belongs to the people at large and more so to the people the Company serves. Your Company has pledged its resources in various sectors and isor material orders were passedstriving continuously with the sole objective of creating an environment of well-being in all spheres of life. The group has been implementing a range of CSR activities over the last fifty years, in areas like healthcare, education, womens upliftment in rural India and environment protection.

In line with the provisions of the Companies Act, 2013 as amended from time to time and the Rules framed there under with respect to the Corporate Social Responsibility (CSR), the Company has formulated a Policy on CSR and has also constituted a CSR Committee to recommend and monitor expenditure on CSR. In terms of the requisite requirements, due processes and controls have been set up by the Company to ensure that all CSR contributions sanctioned by the CSR committee are expended by the relevant organisations for the purpose for which it was sanctioned.

The details of CSR Expenditures are given in the prescribed format which form part of this Report.

The same is annexed as Annexure "A".

The Company continues to actively support deserving social causes for improvement and upliftment of various sections of the society as has been its practice for past several years.

Other Particulars

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required to be disclosed in terms of section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules 2014 is set out in Annexure "D" and forms a part of this Report.

Green Initiative

In commitment to keep in line with the Green Initiative and going beyond it the Company shall be sending the Annual Report for the 2022-23 through electronic means to all those shareholders to all those shareholders who have registered their e-mail ids with the Company/RTA/Depository Participants, as per the relaxations provided by various MCA Circulars.

General

Your Directors state that no disclosures or reporting is required in respect of the following items as there were no transactions on these items during the year under the review: thea) No significant

Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future. b) Issue of Equity Shares with differential voting rights, dividend or otherwise as per Section 43(a)(ii) of the Companies Act, 2013. c) Issue of Shares including Sweat Equity Shares to the employees of the Company under any scheme as per provisions of Section 54(1)(d) of the Companies Act, 2013. d) 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 Companies Act, 2013 e) There was no revision to the financial statements for the year under review.

Acknowledgements

Your Directors would like to acknowledge the continued support and co-operation from its Bankers, Government Bodies, and Business Associates which have helped the Company to sustain its growth during the year.

	For and on behalf of the Board of Directors
Place : Mumbai	Hrishikesh A. Mafatlal
Date : May 29, 2023	Chairman