Ambuja Cements Ltd Directors Report.

Dear Members,

It is our pleasure to present the Annual Report of Ambuja Cements Limited for the year ended December 31, 2020. The PDF version of the Report is also available on the Companys website (www.ambujacement.com/investors/annual-reports).

Financial Performance – 2020

Rs in crores
Standalone Consolidated
Current Year Previous Year Current Year Previous Year
31/12/2020 31/12/2019 31/12/2020 31/12/2019
SUMMARISED PROFIT AND LOSS
Net Sales 11,174.97 11,352.76 24,093.86 26,538.62
Profit before finance cost, depreciation & amortisation 3,018.60 2,575.37 5,455.16 5,177.73
expense and exceptional item
Finance costs 83.05 83.52 140.22 169.87
Depreciation and amortisation expense 521.17 543.83 1,161.78 1,152.52
Share of profit in associates and joint ventures - - 14.44 19.97
Exceptional items - - 176.01 -
Profit before tax and Non-controlling interest 2,414.38 1,948.02 3,991.59 3,875.31
Tax expense 624.28 419.48 884.75 1,092.15
Profit after tax but before Non-controlling interest 1,790.10 1,528.54 3,106.84 2,783.16
Less : Non-controlling interest - - 741.40 688.16
Net profit for the year 1,790.10 1,528.54 2,365.44 2,095.00
MOVEMENT IN RETAINED EARNINGS
Balance as per last account 3,534.96 2,342.84 5,248.70 3,542.04
Net profit for the year 1,790.10 1,528.54 2,365.44 2,095.00
Other comprehensive income (net of tax expenses) (6.97) (4.39) (14.34) (29.09)
Dividend on equity shares (including interim) (3,673.45) (297.85) (3,673.45) (297.85)
Corporate dividend tax on above - (34.18) (0.37) (61.40)
Closing balance 1,644.64 3,534.96 3,925.98 5,248.70

There are no significant changes in the key financial ratios during the year under review.

Dividend

The Company has a robust track record of rewarding its shareholders with a generous dividend pay-out (both interim and final). In view of the Companys very encouraging performance and on account of healthy retained earnings and cash position, the Board declared an interim dividend of Rs17 per share (850%) during the year 2020. The Board of Directors is now pleased to recommend a final dividend of Rs1 per share (50%). This represents a pay-out ratio of 11%. Thus, the aggregate dividend for the year 2020 is Rs18 per share (900%) and the total pay-out will be Rs3,673.45 crores.

The dividend pay-out is in accordance with the Companys Dividend Distribution Policy, attached as Annexure I to this report. The Policy is also available on the Companys website https://www.ambujacement.com/Upload/PDF/dividend-distribution-policy.pdf

Credit Rating

The Companys sound financial management and its ability to service financial obligations in a timely manner, has been affirmed by the credit ratings agency CRISIL with long-term instrument rated as AAA/STABLE and short-term instrument rated as A1+.

Managements Discussion and Analysis Report

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

Corporate Social Responsibility (CSR) and Sustainability

Corporate Social Responsibility (CSR) at the Company has evolved over the past three decades, building prosperous communities in our neighbourhood which is part of our DNA and an integral component of a sustainable business. Ambuja Cement Foundation (ACF), the CSR arm of the Company has reached 2.7 million people across 2,613 villages in 44 districts spanning 11 states of India.

In order to enhance prosperity within the host communities, ACF works on thrust areas through systematic assessments across sites over a defined period which addresses the social and economic development of the communities. The core areas include Water Resource Management, Agro based as well as Skill based Livelihood development, Healthcare, Women Empowerment and Education for All.

The Annual Report on CSR activities and expenditure, as required under Sections 134 and 135 of the Companies Act, 2013 read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Rule 9 of the Companies (Accounts) Rules, 2014, is provided as Annexure II to this Report and the CSR Policy is available on the website of the Company. Our Sustainable Development Plan 2020-2030, ‘Building for Tomorrow has identified and defined four focus areas for our business and vests a catalytic approach towards planning and management. The four thrust areas are Climate & Energy, Circular Economy, Environment and Community. Our operational-site level objectives help the respective heads align with and accomplish overall sustainability objectives. With the strides made in 2020, we are on track to achieve the intermediate sustainable development targets in the four defined areas, set for the year 2021. Aligning with ‘Net Zero ambition of our parent LafargeHolcim by 2050, we have increased our focus on Waste Heat Recovery (WHR), Renewable Energy, Clinker Factor reduction, Energy Efficiency (thermal and electrical), and use of Waste-derived resources/ alternative fuels.

Disclosures under the Companies Act, 2013 and Listing Regulations

Annual Return

The Annual Return as required under Section 92 and Section 134 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the Companys website (www.ambujacement.com/investors/annual-reports).

Number of Board Meetings

Eleven Board meetings were held during 2020. The particulars of the meetings held and attended by each Director are detailed in the Corporate Governance Report forming part of this Report.

Composition of Audit Committee

The Board has constituted the Audit Committee, which has Mr. Rajendra Chitale as the Chairman and Mr. Nasser Munjee, Ms. Shikha Sharma and Mr. Martin Kriegner as members. More details on the committee are given in the Corporate Governance Report forming part of this Report.

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

Related Party Transactions

In line with the requirements of the Companies Act, 2013 and Listing Regulations, the Company has formulated a Policy on Related Party Transactions, which is also available on the Companys website (https://www.ambujacement.com/ Upload/PDF/Policy-on-materiality-of-RPT-221020.pdf ). All the related party transactions entered into by the Company during the financial year were on an arms length basis and in the ordinary course of business and adheres to the applicable provisions of the Act and the Listing Regulations. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or others, which may have a potential conflict with the interest of the Company at large or which warrants the approval of the shareholders. No material contracts or arrangements with related parties were entered during the year. All related party transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained before the commencement of the new financial year, for the transactions which are repetitive in nature and also for the transactions which are not foreseen (subject to financial limit). A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value, and terms and conditions of the transactions. The statement is supported by the certification from the MD & CEO and the CFO. All related party transactions are subject to half-yearly independent review by a reputed accounting firm to establish compliance with the requirements of Arms Length Pricing. In accordance to Section 134 of the Companies Act, 2013 and Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of the contract or arrangement entered into by the Company with related parties referred to in Section 188(1) in Form AOC-2 is attached as Annexure III of this report.

Policy on Sexual Harassment of Women at Workplace

The Company has zero tolerance towards sexual harassment at the workplace and to this end, has adopted a policy in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Policy) and the Rules thereunder. All employees (permanent, contractual, temporary, trainees) are covered under the said Policy. An Internal Complaints Committee has also been set up to redress complaints received on sexual harassment. During the financial year under review, two complaints were received by the Company and both of which were dealt with in line with the POSH Policy of the Company and disposed off. No cases of child labour, forced labour, involuntary labour and discriminatory employment were reported during the period. The Company is committed to providing a safe and conducive work environment to all its employees and associates.

Corporate Governance

The Company has complied with the corporate governance requirements under the Companies Act, 2013 and the Listing Regulations. A separate Section on corporate governance, along with a certificate from the statutory auditors confirming compliance is annexed and forms part of the Annual Report.

Risk Management

The Risk management committee at Ambuja is constituted under the chairmanship of Mr. Rajendra Chitale, Independent Director and the Committee reviews and discusses the risk trends, exposure and potential impact analysis. All this is done while maintaining the appropriate controls to ensure effective and efficient operations and regulatory compliance.

The Company has formulated a risk management policy and has mechanism in place to apprise the Board about risk assessment and mitigation process, including sustainability risks, which is covered in detail in the Management Discussion and Analysis Report attached to this Report.

Internal Audits and Controls

The establishment of an effective corporate governance and internal control system is essential for sustainable growth and long-term improvements in corporate value, and accordingly the Company works to strengthen such structures. The Company believes that a strong internal control framework is an important pillar of Corporate Governance.

The current system of Internal Financial Controls is aligned with the requirement of the Companies Act, 2013 and is in line with globally accepted risk-based framework as issued by the Committee of Sponsoring Organisations (COSO) of the Treadway Commission. This framework includes entity-level policies, processes and Standard Operating Procedures (SOP). The compliance with these policies and procedures is ingrained into the management review process. Moreover, the Company regularly reviews them to ensure both relevance and comprehensiveness of the Internal Financial Controls. The Company uses IT-supported platforms to keep the IFC framework robust.

The Company periodically assesses design as well as operational effectiveness of its internal controls across multiple functions and locations through extensive internal audit exercises. Based on the assessment of internal audit function, process owners undertake corrective action in their respective areas, and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

Managing the Risks of Fraud, Corruption and Unethical Business Practices

Vigil Mechanism/Whistle-Blower Policy

Creating a fraud and corruption-free culture has always been at the Companys core. In view of the potential risk of fraud, corruption and unethical behaviour that could adversely impact the Companys business operations, performance and reputation, it has emphasised addressing these risks. To meet this objective, a comprehensive Ethical View Reporting Policy akin to Vigil Mechanism or the Whistle-Blower Policy has been laid down. In terms of the said Policy, all the reported incidents are reviewed by a designated Ethical View Committee. Based on an in-depth review, all such incidents are investigated in an impartial manner and appropriate actions are taken to uphold the highest professional, ethical and governance standards. The Policy also provides for the requisite checks, balances and safeguards to ensure that no employee is victimised or harassed for reporting and bringing up such incidents in the interest of the Company.

No personnel have been denied access to the Audit Committee for any matter pertaining to the Ethical View Policy. The implementation of the Ethical View Policy and the functioning of the Ethical View Committee is overseen by the Audit Committee.

More details on this Policy are given in the Corporate Governance Report, which forms part of this Report. The Ethical View Reporting Policy is available on the Companys website (www.ambujacement.com/investors).

Code of Conduct

The Company has laid down a robust Code of Business Conduct and Ethics, which is based on the principles of ethics, integrity and transparency. More details about the Code is given in the Corporate Governance Report.

Anti-bribery and Corruption Directives (ABC Directives)

In furtherance to the Companys philosophy of conducting business in an honest, transparent and ethical manner, the Board has laid down ‘ABC Directives as part of the Companys Code of Business Conduct and Ethics. As a company, Ambuja Cement has zero-tolerance to bribery and corruption and is committed to act professionally and fairly in all its business dealings. To spread awareness about the Companys commitment to conduct business professionally, fairly and free from bribery and corruption and as part of continuous education to the employees on ‘ABC Directives, face-to-face and online training and testing through a web-based application tool was conducted for 2,300 relevant employees. The above policies and its implementation are closely monitored by the Audit and Compliance Committees of Directors and periodically reviewed by the Board.

Board of Directors and Key Managerial Personnel

Cessation

Mr. Roland Kohler (DIN: 08069722) Director (representing LafargeHolcim) resigned from the Board from the closing hours of December 10, 2020 upon his retirement from the services of Lafarge Holcim Group.

The Board placed on record its appreciation for the valuable services rendered by Mr. Roland Kohler.

Appointment

Mr. Ramanathan Muthu (DIN: 01607274) has been appointed as a Non-Executive, Non-Independent Director with effect from December 23, 2020 in casual vacancy caused due to the resignation of Mr. Roland Kohler. Mr. Ramanathan Muthu shall hold the office up to the date of the ensuing Annual General Meeting and being eligible, has offered himself to be appointed as a Director liable to retire by rotation. The Company has received a notice from a Member under Section 160 of the Companies Act, 2013 signifying his intention to propose the candidature of Mr. Ramanathan Muthu for the office of Director.

The Nomination & Remuneration Committee and the Board of Directors recommends his appointment.

Appropriate resolution seeking shareholders approval to the above are appearing in the Notice convening the 38th Annual General Meeting.

More details about the Directors are either given in the Corporate Governance Report or in the Notice of the ensuing Annual General Meeting being sent to the shareholders along with the Annual Report.

Retirement by Rotation

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Mahendra Kumar Sharma (DIN: 00327684) and Ms. Then Hwee Tan (DIN: 08354724) will retire by rotation at the ensuing Annual General Meeting of the Company and being eligible, have offered themselves for re-appointment. The Board recommends their re-appointment.

Key Managerial Personnel

During the year under review, Mr. Bimlendra Jha, MD & CEO resigned from the Company with effect from February 20, 2020 and Mr. Neeraj Akhoury was appointed as the MD & CEO with effect from February 21, 2020.

Ms. Rajani Kesari has been appointed as the CFO of the Company in place of Ms. Sonal Shrivastava. The Board placed on record its appreciation for the valuable services rendered by Mr. Bimlendra Jha and Ms. Sonal Shrivastava.

There is no change in the Company Secretary during the year under review.

Attributes, Qualifications and Independence of Directors and their Appointment

The Nomination & Remuneration Committee of Directors have approved a policy for the Selection, Appointment and Remuneration of Directors, which inter-alia, requires that the Directors shall be of high integrity with relevant expertise and experience to have a diverse Board. The Policy also lays down the positive attributes/criteria while recommending the candidature for the appointment of a new Director.

The Board Diversity Policy of the Company requires the Board to have a set of accomplished individuals, ideally representing a wide cross-section of industries, professions, occupations and functions and possessing a blend of skills, domain and functional knowledge, experience and educational qualifications, both individually, as well as collectively. Directors are appointed/re-appointed with the approval of the Members for a term in accordance with the provisions of the law and the Articles of Association. The initial appointment of Managing Director & CEO is generally for a period of five years. All Directors other than Independent Directors are liable to retire by rotation unless otherwise specifically provided under the Articles of Association or under any statute. One-third of the Directors who are liable to retire by rotation, retire at every Annual General Meeting and are eligible for re-appointment. The relevant abstract of the Policy for Selection, Appointment & Remuneration of Directors is given as Annexure IV to this report.

Independent Directors

The Independent Directors have submitted the Declaration of Independence, stating that they continue to fulfil the criteria of independence as required pursuant to Section 149 of the Companies Act, 2013 and Regulations 16 of the Listing Regulations. This Section require companies to have at least one-third of the total number of Directors as Independent Director and the Company complies with this requirement. There has been no change in the circumstances affecting their status as Independent Directors of the Company. The profile of the Independent Directors forms part of the Corporate Governance Report In the Boards opinion, the Independent Directors are persons of high repute, integrity and possess the relevant expertise and experience in their respective fields.

Evaluation of the Boards Performance

As per provisions of the Companies Act, 2013 and Regulation 17(10) of the Listing Regulations, the evaluation process for the performance of the Board, its committees and individual Directors for the year 2020 was carried out internally.

With a view to maintain high level of confidentiality and ease of doing evaluation, the exercise was carried out online using secured web-based application. Each Board member filled up the online evaluation template on the functioning and overall level of engagement of the Board and its committees, on parameters such as composition, execution of specific duties, quality, quantity and timeliness of flow of information, deliberations at the meeting, independence of judgement, decision-making, management actions etc. The evaluation templates were modified considering the guidelines issued under the Listing Regulations and Secretarial Standards and taking into consideration the suggestions given by the Directors.

A one-on-one meeting of the individual Directors with the Chairman of the Board and Chairman of Nomination & Remuneration Committee was also conducted as a part of self-appraisal and peer-group evaluation and the engagement and impact of individual Director was reviewed on parameters such as attendance, knowledge and expertise, inter-personal relationship, engagement in discussion and decision-making process, actions oriented and others. The Directors were also asked to provide their valuable feedback and suggestions on the overall functioning of the Board and its committees and the areas of improvement for a higher degree of engagement with the management.

The Independent Directors met on December 22, 2020 to review the performance evaluation of Non-Independent Directors and the entire Board of Directors, including the Chairman, while considering the views of the Executive and Non-Executive Directors. The Independent Directors were highly satisfied with the overall functioning of the Board, its various committees and with the performance of other Non-Executive and Executive Directors. They also appreciated the exemplary leadership role of the Board Chairman in upholding and following the highest values and standards of corporate governance. Post the review by the Independent Directors, the results were shared with the entire Board and its respective committees. The Board expressed its satisfaction with the evaluation results, which reflects the high degree of engagement of the Board and its committees with the Management.

Based on the outcome of the evaluation and assessment cum feedback of the Directors, the Board and the Management have agreed on various action points which will be implemented during the year 2021.

Remuneration Policy

The Company follows a policy on the Remuneration of Directors and Senior Management Employees. The Policy is approved by the Nomination & Remuneration Committee and the Board. The main objective of the said Policy is to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Directors, KMP and Senior Management employees. The remuneration involves a balance between fixed and incentive pay, reflecting short- and long-term performance objectives appropriate to the working of the Company and its goals. The Remuneration Policy for the Directors and Senior Management employees is given in the Corporate Governance Report.

Induction and Familiarisation Programme for Directors

The details of the induction and familiarisation programme of the Directors are given in the Corporate Governance Report.

Directors Responsibility

Pursuant to Section 134 of the Companies Act, 2013, the Board of Directors to the best of their knowledge and ability confirm that: i) in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same; ii) they have selected such accounting policies, judgements and estimates that are reasonable and prudent and have applied them consistently to give a true and fair view of the state of affairs of the Company as on December 31, 2020, and of the statement of Profit and Loss and Cash Flow of the Company for the period ended December 31, 2020 iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities iv) the annual accounts have been prepared on an ongoing concern basis v) proper internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and were operating effectively vi) proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems are adequate and are operating effectively also received a certificate from the Cost Auditor certifying their independence and arms length relationship with the Company. Pursuant to Companies (Cost Records and Audit) Rules, 2014, the Cost Audit Report for 2019 was filed with the Ministry of Corporate Affairs on May 21, 2020 vide SRN: R39314232.

As per the requirements of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Company has maintained cost accounts and records in respect of the applicable products for the year ended December 31, 2020.

Secretarial Auditor

The Board had appointed Mr. Himanshu S. Kamdar (CP No.3030), Partner of M/s. Rathi & Associates, Company Secretaries in Whole-time Practice, to carry out Secretarial Audit under the provisions of Section 204 of the Companies Act, 2013 for 2020 and his report is annexed as Annexure V to this Report. The report does not contain any qualification, reservation and adverse remarks.

Reporting of Fraud

The Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

Auditors & Auditors Report

Statutory Auditor

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No.117366W/W-100018) were appointed as the Statutory Auditors for a period of five years commencing from the conclusion of the 34th Annual General Meeting until the conclusion of the 39th Annual General Meeting by the shareholders. M/s. Deloitte Haskins & Sells LLP have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI). The Auditors have also furnished a declaration confirming their independence as well as their arms length relationship with the Company as well as declaring that they have not taken up any prohibited non-audit assignments for the Company. The Audit Committee reviews the independence of the Auditors and the effectiveness of the Audit process. The Auditors attend the Annual General meeting of the Company.

The Auditors Report for financial year 2020 on the financial statement of the Company forms part of this Annual Report. Explanations or comments by the Board on ‘emphasis of matters made by the statutory auditors in their report includes Order passed by the Competition Commission of India in two matters, which has been dealt in more detail in this Report.

Cost Auditor

Pursuant to Section 148 of the Companies Act, 2013, the Board of Directors on the recommendation of the Audit Committee appointed M/s P.M. Nanabhoy & Co. Cost Accountants (ICWAI Firm Registration No. 000012) as the Cost Auditors of the Company for 2021 and has recommended their remuneration to the shareholders for their rati_cation at the ensuing Annual General Meeting. M/s P.M. Nanabhoy & Co. have given their consent to act as Cost Auditors and confirmed that their appointment is within the limits of the Section 139 of the Companies Act, 2013. They have also certified that they are free from any disqualifications specified under Section 141 of the Companies Act, 2013. The Audit Committee has

Compliance with Secretarial Standards on Board and Annual General Meetings

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and Annual General Meetings.

Significant and Material Orders Passed by the Courts or Regulators

Order passed by the National Company Law Appellate Tribunal (NCLAT) in the Matter of Penalty Levied by the Competition Commission of India (CCI) i) Appeal filed by the Company against the Order of the CCI for levying penalty of Rs1,163.91 crores on the Company was heard and dismissed by the NCLAT and CCIs Order was upheld. Further, the Company has challenged the judgement passed by NCLAT before the Honble Supreme Court. The Honble Supreme Court has admitted the Companys Appeal and ordered for the continuation of interim order passed by the Tribunal. ii) Pursuant to a reference filed by the Director, Supplies and Disposals, Government of Haryana, the CCI vide its Order dated January 19, 2017 has imposed a penalty of Rs29.84 crores on the Company. The Company filed an Appeal before the Competition Appellate Tribunal (COMPAT) and obtained an interim stay on the operation of the said Order. Further, by virtue of Government of India notification, all cases pending before the COMPAT were transferred to the NCLAT and as such, the hearing on the Appeal is underway at the NCLAT. Other than the aforesaid, there have been no significant and material orders passed by the courts or regulators or tribunals impacting the ongoing concern status and the Companys operations. However, members attention is drawn to the statement on contingent liabilities and commitments in the notes forming part of the Financial Statements.

Particulars of loans, guarantees or investments

Particulars of loans, guarantees given and investments made during the year, as required under Section 186 of the Companies Act, 2013 and Schedule V of the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulations, 2015, are provided in Notes No. 9, 10, 11, 18, 53 and 54 of the Standalone financial statements.

Treasury Operations

During the year, the Companys treasury operations continued to focus on cash forecasting and the deployment of excess funds on the back of effective portfolio management of funds within a well-defined risk management framework. All investment decisions in deployment of temporary surplus liquidity continued to be guided primarily by the tenets of safety of Principal and liquidity. During the year, the investment portfolio mix was continuously rebalanced in line with the evolving interest rate environment.

Transfer of Unclaimed Dividend and Unclaimed Shares

The details relating to Unclaimed Dividend and Unclaimed Shares forms part of the Corporate Governance Report forming part of this Report.

Energy, Technology and Foreign Exchange

Information on the conservation of energy, technology absorption, foreign exchange earnings and out go is required to be given pursuant to the provisions of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules 2014, which is marked as Annexure VI to this Report.

Particulars of Employees

There were 4,792 permanent employees of the Company as of December 31, 2020. The disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure VII to this Report. Further, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits as set out in the Rules 5(2) and 5(3) of the aforesaid Rules forms part of this Report. However, in terms of first provision of Section 136(1) of the Act, the Annual Report and Accounts are being sent to the members and others entitled thereto, excluding the aforesaid information. The said information is available for inspection by the members at the Registered Office of the Company during business hours on working days up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary, whereupon a copy would be sent.

Direct Subsidiaries, Joint Ventures and Joint Operations

As of December 31, 2020, the Company has six direct subsidiaries, one joint venture and one joint operation. The Policy for determining Material Subsidiaries adopted by the Board pursuant to Regulation 16 of the Listing

Regulations, can be accessed on the Companys website (www.ambujacement.com/investors).

Consolidated Financial Statements

As stipulated by Regulation 33 of the Listing Regulations, the Consolidated Financial Statements have been prepared by the Company in accordance with the applicable Accounting Standards. The audited Consolidated Financial Statements, together with Auditors Report, form part of the Annual Report. Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of each subsidiary, joint venture and joint operations in the prescribed Form AOC-1 is annexed as Annexure VIII to this Report.

Pursuant to Section 136 of the Companies Act, 2013, the financial statements of the subsidiary and joint venture companies are kept for inspection by the shareholders at the Registered Office of the Company. The Company shall provide free of cost, the copy of the financial statements of its subsidiary and joint venture companies to the shareholders upon their request. The statements are also available on the Companys website (www.ambujacement.com/investors). The consolidated net profit attributable to the Company is Rs2,365.44 crores for 2020 as compared to Rs2,095.00 crores for 2019.

Business Responsibility Reporting

The Business Responsibility Report of the Company for the year ended December 31, 2020, is made available on the Companys website www.ambujacement.com and also forms part of the Annual Report.

Other Disclosures

No disclosure or reporting is made with respect to the following items, as there were no transactions during the year under review:

• D etails relating to deposits that are covered under Chapter V of the Act

• The issue of equity shares with differential rights as to dividend, voting or otherwise

• The issue of shares to the employees of the Company under any scheme (sweat equity or stock options)

• There is no change in the Share Capital Structure during the year under review

• The Company does not have any scheme or provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees

• Managing Director & CEO has not received any remuneration or commission from any of its subsidiaries

• There was no revision in the financial statements

• There was no change in the nature of business

• There were no material changes and commitments affecting financial position of the Company between the end of the financial year and the date of this report

• The Company has not transferred any amount to reserves during the year under review

Equal Opportunity Employer

The Company has always provided a congenial atmosphere for work that is free from discrimination and harassment, including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex.

Caution Statement

Statements in the Directors Report and the Management Discussion and Analysis describing the Companys objectives, expectations or predictions may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Crucial factors that could influence the Companys operations include global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country and other factors that are material to the business operations of the Company.

Acknowledgements

The Directors take this opportunity to express their deep sense of gratitude to the Banks, Central and State Governments and their Departments, and the Local Authorities for their continued guidance and support. The Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Ambuja family. To them goes the credit for the Companys achievements. And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.

For and on behalf of the Board of Ambuja Cements Limited

Mumbai N. S. Sekhsaria
February 18, 2021 Chairman & Principal Founder