pacific industries ltd Directors report

To,

The Members of Pacific Industries Limited,

The Board of Directors have pleasure in presenting their 34^th Annual Report on the business and operations of Pacific Industries Limited along with the Audited Financial Statements for the Financial Year Ended March 31, 2023. This report states compliance as per the requirements of the Companies Act, 2013 (-the Act-), the Securities and Exchange Board of India (Listing Obligations & Disclosure Requirements) Regulations, 2015 (-Listing Regulations-) and other rules and regulations as applicable to the Company.

1. FINANCIAL HIGHLIGHTS

The Standalone and Consolidated Financial Results of the company for the year ended 31^st March, 2023 are as follows:

Particulars	Standalone (F.Y.)		Consolidated (F.Y.)
	2022-23	2021-22	2022-23	2021-22
Revenue from Operations and Other Income	19,048.01	28,626.52	20,385.82	29,341.53
Less: Operating Cost	17,028.99	25,556.74	18,036.90	25,753.64
Operating Profit/PBDIT	2019.02	3069.78	2,348.92	3,587.89
Less: Interest & Finance Charges	799.92	662.59	389.01	351.87
Less: Depreciation & Amortization Expenses	1134.66	1,088.32	1140.48	1079.81
Profit Before Tax and Exceptional Items	84.44	1318.86	819.43	2156.21
Add: Exceptional items	-	-	-	-
Profit Before Tax	84.44	1318.86	819.43	2156.21
Less: Provision for Tax	(19.46)	374.34	168.82	564.53
Less: Prior Period Adjustment	-	-	-	-
Profit After Tax	103.90	944.50	650.61	1591.68
Total Other Comprehensive income	(20.44)	45.94	(20.80)	45.94
Total Comprehensive Income for the year	83.46	990.44	629.82	1637.62

1. Overview and the State of the Company Affairs

Your Companys income from operations during the year under review was INR 19,048.01 Lakhs as compared to INR 28,626.52 Lakhs in the previous year. The total profit incurred during the year under review was Rs. 103.90 Lakhs as against Profit of Rs. 944.50 Lakhs during the previous year.

Detailed analysis and future outlook of the Companys business are dealt in the Management Discussion and Analysis Report.

2. DIVIDENDS

The Board of Directors thought it prudent not to recommend any Dividend for the financial year ended 31^st March, 2023.

3. TRANSFER TO RESERVES

The Board of Directors didnt propose to transfer any sum to the General Reserve.

4. MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

Managements Discussion and Analysis Report for the year under review, in terms of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the -Listing Regulations-), is presented in a separate section forming part of the Annual Report.

5. MATERIAL CHANGES AFFECTING THE COMPANY AND COMMITMENT

There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and date of this Report. There has been no change in the nature of business of the Company.

6. SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE.

During the year The Income Tax Department has conducted inquiry under Section 132 & 133 of the Income Tax Act, 1961 from 16^th February,2023 to 21st February,2023. and No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and companys Operations in future.

7. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is provided in Annexure 1 and is attached to this report.

8. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY

The Company has in place a Risk Management Policy, pursuant to Section 134 of the Companies Act 2013. This robust Risk Management framework enables identification and evaluation of business risks and opportunities, seeks to create transparency, minimize adverse impact on business objectives and enhance the Companys competitive advantage.

The Company has laid down a well-defined risk management mechanism commensurate with its size and the nature of business covering risk mapping, risk exposure and risk mitigation process. The Companys Risk Management Policy has been developed to include various categories such as Human Resources, Financial, Business Processes and Systems, Strategy, Corporate Governance and Compliance and Information Security.

Further, the Board ensures risk reporting and updates, risk policy compliances and provide overall guidance and support to business risk owners.

9. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Company has a Policy on Corporate Social Responsibility and the same has been posted on the website of the Company i.e www.pacificindustriesltd.com. The Annual Report on CSR activities in terms of the requirements of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure-7, which forms part of this Report.

10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The Company has not given Loans or guarantees or investments pursuant to Section 186 of the Companies Act, 2013 to other Body Corporates or persons as indicated in the notes to the financial statements.

11. PARTICULARS OF CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. During the year, the Company did not enter into any contract/ arrangement/ transaction with related parties, which could be considered material in accordance with Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Company has also disclosed related party transactions on a consolidated basis for the half year ended to the stock exchange and has also published the same on the website of the Company.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companys website.The particulars as required under the Act are furnished in Annexure 4 (Form No. AOC-2) to this Report.

12. SECRETARIAL STANDARDS

The Company complies with all the applicable provisions of Secretarial Standards.

13. AUDITORS AND AUDITORS REPORT

A. Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and rules made thereunder, M/s Ravi Sharma & Co., Chartered Accountants, Jaipur (Firm Registration No. 015143C) were appointed as Statutory Auditors of the Company for a the Further term of five consecutive years, to hold office from the conclusion of the this Annual General Meeting until the conclusion of 38^th Annual General Meeting of the Company, on such remuneration as may be decided by the Audit Committee and the Board of Directors.

Pursuant to Section 139 and 141 of the Companies Act, 2013 and relevant Rules prescribed there under, the Company has received certificate from the Auditors to the effect, inter-alia, confirming that their appointment continues to be within the limits laid down by the Act, is as per the term provided under the Act, that they are not disqualified for continuing such appointment under the provisions of applicable laws and also that there are no pending proceedings against them or any of their partners with respect to professional matters of conduct.

B. Secretarial Auditor

The board has appointed M/s B K Sharma & Associates, Practising Company Secretaries, as secretarial auditor of the Company for the FY 2022-23 as per the provisions of Section 204 of Companies Act 2013 and rules made thereunder.

The Secretarial Audit Report for the financial year 2022-23 is attached herewith as Annexure 5. The report does not contain any reservation, qualification or adverse remark. Information referred in the Secretarial Auditor Report are self-explanatory and do not call for any further comments.

Secretarial Audit of Unlisted Indian Subsidiary

M/s Gist Minerals Technologies Limited, and Gaze Fashiontrade Limited wholly owned subsidiary of the Company undertakes Secretarial Audit was carried out pursuant to Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by M/s Monika Jain & Associates, Practising Company Secretaries, does not contain any qualification, reservation or adverse remark or disclaimer and is attached herewith as Annexure 6.

Cost Audit

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company is not required to maintain cost records and conduct cost audit.

14. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

The information required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report as Annexure 3.

15. POLICY RELATING TO DIRECTORS APPOINTMENT AND REMUNERATION ETC.

The Board has framed a Policy relating to appointment of Directors, payment of Managerial remuneration, Directors qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178 (3) of the Companies Act, 2013 based on the recommendation of Nomination and Remuneration Committee. The details of this Policy have been disclosed in the Corporate Governance Report, which forms part of this Report.

16. ANNUAL EVALUATION OF BOARDS PERFORMANCE, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has carried out an annual performance evaluation of the working of its own performance, the Directors individually as well as evaluation of its Committees.

The Board and Nomination and Remuneration Committee reviewed the performance ofIndividual Directors, the Board as a whole, Committees of the Board and Chairman and Managing Director after taking into consideration feedback received from Directors. The evaluation was done on various parameters such as vision and strategy, participation, disclosures of interests, good governance, leadership skills, operations, business development, human resources development, corporate communication etc. The feedback received from Directors were then consolidated and placed before the Committee / Board for its evaluation. The Directors expressed their satisfaction with the evaluation process.

17. ANNUAL RETURN

As required under the provisions of Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, the Company is required to place a copy of Annual Return (in Form MGT-7) on the Companys website https://pacificindustriesltd.com.

By virtue of amendment to Section 92(3) of the Companies Act, 2013, the Company is not required to provide extract of Annual Return (Form MGT-9) as part of the Boards report.

18. BOARD MEETINGS HELD DURING THE FINANCIALYEAR 2022-23

During the financial year 2022-23, Ten (10) Board Meetings were held on 20.05.2022, 28.05.2022,09.08.2022, 31.08.2022, 12.11.2022, 16.11.2022, 03.12.2022, 05.01.2023, 08.02.2023, 21.02.2023 details of which are furnished in the Corporate Governance Report forming part of this Report. The gap between any two Meetings did not exceed 120 days. In accordance with the provisions of Schedule IV of Companies Act, 2013 (-the Act-) and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (-SEBI LODR Regulations-), a separate meeting of the Independent Directors of the Company was held on March 11, 2023 to review the performance of Non-Independent Directors (including the Chairperson) and the entire Board.

The Independent Directors also reviewed the quality, quantity and timeliness of the flow of information between the Management and the Board.

19. COMMITTEES OF THE BOARD

The Board of Directors have the following Committees:

a. Audit Committee

b. Nomination and Remuneration Committee

c. Stakeholders Relationship Committee

d. Corporate Social Responsibility Committee

The details of the Committees along with their composition, number of meetings held and attendance at the meetings are provided in the Corporate Governance Report.

20. DIRECTORS RESPONSIBILITY STATEMENT

In terms of the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013, the Board of Directors, in respect of the year ended 31st March, 2023, hereby confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) The Directors had selected such accounting policies and applied them 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 at the end of the financial year and of the profit and loss of the Company for that period;

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors had prepared the annual accounts on a going concern basis;

e) The Directors had laid down proper internal financial controls to be followed by the Company and that such internal financial controls were adequate and were operating effectively; and

f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and were operating effectively.

21. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company has the following subsidiaries as on 31st March, 2023:

Wholly owned Subsidiaries:-

a) Gaze Fashiontrade Limited, a 100% Subsidiaries of the Company situated in the state of Karnataka.

b) Gist Minerals & technologies Limited, a 100% Subsidiaries of the Company situated in the state of Karnataka.

c) TAANJ QUARTZ INC US Based Wholly Owned Subsidiary Company.

There is no associate company within the meaning of section 2(6) of the Companies Act, 2013. There has been no material change in the nature of the business of the Subsidiaries.

22. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and all the subsidiaries form a part of this Annual Report and have been prepared in accordance with section 129(3) of the Companies Act, 2013. A separate statement containing salient features of the Financial Statements in prescribed format AOC-1 is annexed as Annexure-2 to this report.

This statement also provides the details of the performance and financial position of each of the Subsidiary Company.

23. LISTING OF SHARES

The shares of the Company are listed on BSE Limited and the listing fee for the year 2023-24 has been duly paid.

24. DEPOSITS

The Company has neither accepted nor renewed any deposits during the year under review.

Disclosure under Rule 8(5) of Companies (Accounts) Rules, 2014

No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable. The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

25. DEPOSITORY SYSTEM

The Company has entered into agreement with the National Securities Depository Limited and Central Depository Services (India) Limited (CDSL) to enable shareholders to hold shares in a dematerialized form. The Company also offers simultaneous dematerialization of the physical shares lodged for transfer.

26. DISCLOSURE UNDER SECTION 164(2) OF THE COMPANIES ACT, 2013

The Company has received disclosures in Form DIR - 8 from all the Directors of the Company and has noted that the none of the Director is disqualified under Section 164(2) of the Companies Act, 2013 read with Rule 14(1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

27. DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors

The Board of the Company is comprised of eminent persons with proven competence and integrity.

Besides the experience, strong financial acumen, strategic astuteness, and leadership qualities, they have a significant degree of commitment towards the Company and devote adequate time to the meetings and preparation.

As on the date of the report, the Board comprises, 3 Independent, 1 Non-Executive and 2 Executive Directors, details thereof have been provided in the Corporate Governance Report.

In terms of the requirement of the Listing Regulations, the Board has identified core skills, expertise, and competencies of the Directors in the context of the Companys businesses for effective functioning. The list of key skills, expertise and core competencies of the Board of Directors is detailed in the Corporate Governance Report.

In the opinion of the Board, all the directors, as well as the directors appointed / re-appointed during the year possess the requisite qualifications, experience and expertise and hold high standards of integrity.

Pursuant to Section 149, 152 and other applicable provisions of the Companies Act, 2013, one-third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Consequently, Mrs. Geetadevi Jagdish Agarwal (DIN: 00386331), Director of the Company will retire by rotation at the ensuing AGM, and being eligible, offered himself for re-appointment.

During the Financial Year Mrs. Neelam Tater Appointed as Non Executive Independent Director of the Company w.e.f 12.11.2022 and Mr. Vikas Misra Resigned from office of the Directorship w.e.f 19.09.2022 due to his pre occupation. There was no other Director who was appointed/ceased/reelected/reappointed during the year under review.

A brief resume of the Directors being appointed/ re-appointed, the nature of expertise in specific functional areas, names of companies in which they hold Directorships, committee memberships/ chairmanships, their shareholding in the Company, etc., have been furnished in the explanatory statement to the notice of the ensuing AGM.

Key Managerial Personnel

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

Shri Jagdish Prasad Agarwal, Chairman and Managing Director Shri Kapil Agarwal Executive Director and Chief Financial Officer Mr. Sachin Shah, Company Secretary and Compliance Officer

28. PARTICULARS OF EMPLOYEES

Disclosure with respect to the remuneration of Directors and employees as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as -Annexure 3- to this Report.

A statement comprising the names of top 10 employees in terms of remuneration drawn is not being sent along with this annual report to the Members of the Company in line with the provisions of Section 136 of the Act. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by Members at the Registered Office of the Company, 21 days before and up to the date of the ensuing Annual General Meeting during the business hours on working days.

In terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014, the statement showing the name of the employees drawing remuneration in excess of the limit specified in the Rules are not applicable on the Company as during the period, no employee of the Company was drawing salary in excess of the that drawn by the Managing Director or Whole-time Director.

29. DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all Independent Directors of the Company, confirming that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013.

The Independent directors of the Company have undertaken requisite steps towards the inclusion of their names in the data bank of Independent directors maintained with the Indian Institute of Corporate affairs in terms of Section 150 of the act read with rule 6 of the Companies (appointment & Qualification of directors) rules, 2014.

The Board is of the opinion that all the Independent Directors of the Company possess requisite qualifications, experience and expertise in their domain areas and that they hold highest standards of integrity.

30. INTERNAL FINANCIAL CONTROL SYSTEM

The Company continuously evolves in strengthening its internal control processes and has appointed M/s Pachori Rupesh & Associates, Chartered Accountants, as the Internal Auditor of the Company to fill casual vacancy caused by Resignation of Mr. Ravi Sharma as the Internal Auditor of the company for the Financial Year 2023-2024. The Company has put in place an adequate system of internal control commensurate with its size and nature of business. These systems provide a reasonable assurance in respect of providing financial and operational information, complying with applicable statutes, safeguarding of assets of the Company and ensuring compliance with corporate policies.

Procedures to ensure conformance with the policies, standards and delegations of authority have been put in place covering all activities. Audit Committee periodically reviews the performance of internal audit system.

The Company has a rigorous business planning system to set targets and parameters for operations which are reviewed with actual performance to ensure timely initiation of corrective action, if required. The Audit Committee reviews adherence to internal control systems and internal audit reports. Further, the Board annually reviews the effectiveness of the Companys internal control system.

31. CORPORATE GOVERNANCE

A detailed Report on Corporate Governance, pursuant to the requirements of Regulation 34(3) of the Listing Regulations, forms an integral part of this Report. A Certificate from the M/s B K Sharma & Associates, Company Secretary confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V (E) of the Listing Regulations, is annexed to this Report and M/s B K Sharma & Associates issued a certificate with regards to Dis-Qualification of Directors of the Company as per Regulation 34(3) of SEBI (LODR) Regulations, 2015, is also annexed to this Report.

The Business Responsibility Reporting, as required by Regulation 34(2) of the Listing Regulations, is not applicable to the Company for the financial year ending 31st March, 2023.

The Vigil Mechanism of the Company also incorporates a Whistle Blower Policy in terms of the Listing Regulations thereby establishing a vigil mechanism for Directors and permanent employees for reporting genuine concerns, if any. Protected disclosures can be made by a whistle blower to the Chairman of the Audit Committee. The policy on vigil mechanism and whistle blower policy may be accessed on the Companys website at the link: https://www.pacificindustriesltd.com/policies.

32. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM

The Company has constituted an Audit Committee as required under Section 177 of the Companies Act, 2013 and has also established Vigil Mechanism for their employees and Directors to report their genuine concerns or grievances.

The details of the same are presented in the Corporate Governance Report. The Board has accepted all the recommendations of the Audit Committee during the year under review.

33. GENERAL

During the Financial year 2022-23 following transaction were reported:* No disclosure or reporting is required in respect deposits covered under Chapter V of the Act.

* During the year, there has been no change in the authorized share capital of the Company and Further, During the Financial Year 2022-23, the Company came out with an issue of 34,46,325 Equity Shares on -Rights Issue- basis to the existing Equity Shareholders of the Company at a price of Re.139 per Rights Equity Share with a Premium of Rs129 for raising the funds not exceeding Rs47.90 Lakhs.

Further to the closure of Rights Issue in the month of February, 2023, the Company, in consultation with the Lead Manager to the Issue viz., Srujan Alpha Capital Advisors LLP and the Registrar to the Issue viz., Linkintime India Pvt. Ltd., allotted 34,46,325 Equity Shares on Rights basis to the eligible Equity Shareholders. Upon the allotment of above said 34,46,325 Rights Equity Shares, the paid up Equity Share Capital of the Company got increased from 34,46,325 Equity Shares of Re.10 each to 68,92,650 Equity Shares of Re.10 each.

Out of the issue proceeds of the Rs47.90 Lakhs, your Company has utilised the receipt in full towards Repayment of Unsecured Loan availed from the related party, Working Capital Requirements and General Corporate Purpose of the company. The utilisation of the proceeds has been in accordance with the Objects stated in the Letter of Offer dated 05th January, 2023 in respect of the Rights Issue of the Company in compliance with Regulation 32(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended and there is no deviation as regards the utilisation of funds.

* During the year the company has not Issue of sweat equity shares, bonus shares or employees stock option plan.

* During the year under review, there were no cases were reported pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

* There were no frauds reported by the Auditors under Sub section (12) of Section 143 of the Companies (Amendment) Act, 2015, to the Audit Committee, Board of Directors or Central Government.

* No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

34. PREVENTION OF INSIDER TRADING

In compliance with the provisions of Securities Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Board has adopted a code of conduct and code of practices and procedures for fair disclosure of unpublished price sensitive information to preserve the confidentiality of price sensitive information, prevent misuse thereof and regulate the trading by Insiders. The code of practice and procedures for fair disclosure of unpublished price sensitive information is also available on the Companys website i.e. www.pacificindustriesltd.com.

35. DETAILS OF APPLICATION / ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Neither any application was made nor any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the financial year.

36. DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

As Company has not done any one time settlement during the year under review hence no disclosure is required.

37. ACKNOWLEDGEMENTS

The Company has complete glorious 34^th eventful years of the existence. Very few brands continue to remain relevant and become iconic over such a long passage of time. The Directors are proud of the rich heritage.

The Directors wish to place on record their appreciation, for the contribution made by the employees at all levels but for whose hard work, and support, the Companys achievements would not have been possible.

The Directors also wish to thank its customers, dealers, agents, suppliers, investors and bankers for their continued support and faith reposed in the Company.