Apollo Sindoori Hotels Ltd Directors Report.

Your Directors are pleased to present the Twenty-Fourth Annual Report on the business and operations of the Company together with the Audited Financial Statements for the year ended 31st March 2022.

1. Corporate Overview:

Apollo Sindoori is a leading hospitality service management and support services company. We manage the entire gamut of hospitality services right from food services to kitchen planning and management. Apollo Sindoori has built its heritage by combining its corporate and professional prowess with experience and expertise in catering and hospitality. We strive constantly to achieve "Excellence in Hospitality".

2. Operations / State of the Company?s Affairs:

Your Company?s revenue from operation has increased from Rs.165 Crores as in the previous Financial Year (FY) 2020-21 to Rs.203 Crores in FY 2021-22. The Covid lockdown impact on revenue generations have been reduced and we have restored ourselves to normal position.

EBITDA for the FY 2021-22 stood at Rs.16.58 Crores compared to Rs.11.77 Crores for FY 2020-21 and PBT (Profit Before Tax) for FY 2021-22 is Rs.12.79 crores against Rs.7.89 Crores for FY 2020-21.

Financial overview:

(i) Standalone Financials

(Rs. in Lakhs)

Particulars For the period 01.04.21 to 31.03.22 For the period 01.04.20 to 31.03.21
INCOME:
I Revenue from operations (I) 19,939.19 16,127.84
II Other Income (II) 356.39 398.52
III Total Income ( I + II ) 20295.58 16,526.36
IV EXPENDITURE:
Consumption of Provisions & Stores 7,464.80 5,436.18
Employee benefit expense 9,941.16 8,778.59
Finance Cost 109.15 117.95
Depreciation and amortization expense 269.70 270.14
Other expenses 1,232.06 1,134.54
Total Expenses (IV) 19016.87 15737.40
V Profit before exceptional and extraordinary items and tax (III - IV) 1278.71 788.96
VI Exceptional Items - -
VII Profit before extraordinary items and tax 1278.71 788.96
VIII Extraordinary Items - -
IX Profit before tax 1278.71 788.96
X Tax expense:
(1) (a) Current tax 249.94 160.00
(b) Previous year tax 0 -46.64
(2) Deferred tax 4.78 21.49
XI Net Profit(Loss) for the period (IX - X) 1023.99 654.11
XII Other Comprehensive Income
(i) Items that will not be reclassified to profit or loss
Remeasurement of Defined Benefit Obligation (net of tax) 49.42 -73.44
(ii) Items that will be reclassified to profit or loss - -
XIII Total Comprehensive Income for the period (XI + XII) 1073.41 580.67
XIV Earning per equity share:
Weighted average no. of shares outstanding during the period 26,00,400 26,00,400
Nominal Value per Equity Share 5 5
Earnings per share before extra-ordinary item
- Basic & Diluted EPS 39.38 25.15
Earnings per share after extra-ordinary item
- Basic & Diluted EPS 39.38 25.15

(ii) Consolidated Financials

(Rs. in Lakhs)

Particulars For the period 01.04.21 to 31.03.22 For the period 01.04.20 to 31.03.21
INCOME:
I Revenue from operations 20,793.56 16,873.89
II Other Income 277.08 364.97
III Total Income 21,070.64 17,238.86
IV EXPENDITURE:
Consumption of Provisions & Stores 7,898.94 5,841.25
Employee benefit expense 10,248.94 9,120.01
Finance Cost 239.94 190.52
Depreciation and amortization expense 486.06 463.77
Other expenses 1,481.69 1,434.30
Total Expenses (IV) 20355.57 17,049.86
V Profit before exceptional and extraordinary items and tax 715.07 189.00
VI Share of profits of joint ventures 1046.81 913.23
VII Exceptional Items - -
VIII Profit before extraordinary items and tax 1761.88 1,102.23
IX Extraordinary Items - -
X Profit before tax (VIII - IX) 1761.88 1,102.23
XI Tax expense:
(1) (a) Current tax 249.94 160.00
(b) Previous year tax 0 -46.64
(2) Deferred tax 31.37 32.30
XII Net Profit(Loss) for the period (X - XI) 1480.57 956.57
XIII Other Comprehensive Income
A (i) Items that will not be reclassified to profit or loss
Remeasurement of Defined Benefit Obligation (net of tax) -1.39 -20.25
B (ii) Items that will be reclassified to profit or loss - -
XIV Total Comprehensive Income for the period (XI + XII) 1479.18 936.32
XV Earning per equity share:
Weighted average no. of shares outstanding during the period 26,00,400 26,00,400
Nominal Value per Equity Share 5 5
Earnings per share before extra-ordinary item
- Basic & Diluted EPS 56.94 36.79
Earnings per share after extra-ordinary item
- Basic & Diluted EPS 56.94 36.79

3. Change in nature of business:

During the year, no changes in the nature of business have taken place and Company continues its earlier business and operations.

4. Dividend:

The operations of the Company during the period under review, has improved compared to last year. Considering the same, your Directors recommend a final dividend of Rs. 1.50/- (One Rupee and Fifty Paisa Only) for the FY 2021-22, i.e., 30% of the face value of Rs. 5 per share. Same is subject to approval of the members at the ensuing Annual General Meeting.

5. Transfer to Reserves:

The Company has not made any transfer to reserves and has carried the profit in profit and loss account.

6. Deposits:

The Company has not accepted any public deposits and as such no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

7. Listing:

Your Company is listed on National Stock Exchange of India Limited, Mumbai.

8. Share Capital:

The paid-up equity share capital as on March 31,2022 is Rs. 1,30,02,000/- divided into 26,00,400 equity shares of Rs. 5/- each. During the year under review, your Company has not issued any shares including equity shares with differential rights or sweat equity. Further, Company has no outstanding preference shares or debentures and has not made any redemption of these.

9. Significant or Material Orders Passed by Regulators/Courts:

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

10. Material Changes and Commitment affecting financial position:

There are no material changes and commitments affecting financial position of the Company which has occurred between the end of the financial year of the Company i.e. 31st March 2022 and till the date of this Directors? Report.

11. Corporate Social Responsibility Report:

Your Company has developed and implemented Corporate Social Responsibility initiatives and has spent approximately Rs. 23,24,975/- approved CSR projects during the period under review.

Report on Corporate Social Responsibility including details as Per Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed with this report as Annexure A.

12. Joint Venture Company:

Your Company has a joint venture, namely, Faber Sindoori Management Services Private Limited. The joint venture has been entered based on MOU dated July 14, 2006 with Faber Medi-Serve SDN BHD ("FMS") whereby FMS and Apollo Sindoori Hotels have agreed to form a joint venture company in Chennai for the purpose of setting up a project upon mutually agreed objectives in the domain of bio-medical engineering (maintenance), facility engineering (maintenance), cleansing, housekeeping, janitorial services and hospital support services (other than catering services) and management information services (other than patient information). Accordingly, the joint venture company Faber Sindoori Management Services Private Limited has been incorporated on 27th August 2007 with FMS holding 51% and Apollo Sindoori Hotels holding 49%. Details of the same is provided in AOC-1 under Annexure- B.

13. Subsidiary:

Your company has a wholly owned subsidiary, Olive & Twist Hospitality Private Limited. The subsidiary has been established with a view to carry on elite catering, convention centers & event management. The subsidiary has completed its third full year of the operation and its financials for the financial year ended 31st March 2022 has been consolidated in consolidated accounts of the Company. Details of the subsidiary is also provided in AOC-1 under Annexure- B.

14. Consolidation of Accounts:

Your Company has prepared Consolidated Financial Statements as per Ind AS prescribed under Section 129 read along with Section 133 and prescribed rules of Companies Act, 2013. The consolidated financial statements reflect the financial position of the Company, its Subsidiary and Associates. As required by Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafter referred to as SEBI (LODR) Regulations, 2015 or SEBI LODR), the Audited Consolidated Financial Statements together with the Independent Auditor?s Report thereon are annexed and form part of this Annual Report.

15. Contract or Arrangement with Related Party:

All contracts or arrangements or transactions pursuant to such contract or arrangement with related party during the financial year are in the ordinary course of business and on an arm?s length basis and are on similar terms and conditions as applicable to non-related parties. All the related party transactions are pre-approved by the Audit Committee. Wherever required, Company also obtains the approval of members in compliance to the Companies Act, 2013 and/ or SEBI (LODR) Regulations, 2015. Disclosure as required in form AOC-2 has been provided as Annexure- C to this Directors Report.

The details of the transaction with Related Party are also provided in the accompanying financial statements and notes to account as per AS and may be treated as part of Directors Report.

In the last AGM, Company has sought approval of members for material related party transactions in terms of Regulation 23 of SEBI (LODR) Regulations, 2015.

16. Annual Return web link:

In terms of Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013 and rules thereto, the Annual Return of the Company in Form MGT - 7 for the financial year ended on as on March 31,2022 will be available on the Company?s website at www.apollosindoori.com. The Annual Return will be electronically submitted to the Registrar of Companies within the timelines prescribed under the Act.

17. Composition of Board:

The Board of the Company comprises of optimum combination of Executive, Non-Executive and Independent Directors. Your Board as on date of this report has two executive directors, three non-executive directors and three independent directors. No change took place in the board composition during the period under review. Mr. C Na- tarajan, WTD and CEO of the Company has been reappointed at the last Annual General Meeting for a period of one year w.e.f 30th May, 2022

The composition of the Board is as below:

S.No Name of the Director Designation Executive/ Non-Executive/ Independent
1 Mrs. Sucharitha Reddy Managing Director Executive
2 Mr. C.Natarajan Whole-time Director and Chief Executive Officer Executive
3 Mr. Pottipati Vijayakumar Reddy Director Non- Executive
4 Mrs. Suneeta Reddy Director Non- Executive
5 Mrs. Sindoori Reddy Director Non- Executive
6 Mr. G.Venkatraman Chairman Independent Director
7 Mr. George Eapen Director Independent Director
8 Mr. Suresh Raj Madhok Director Independent Director

18. Attendance of Directors at Board Meetings and Annual General Meeting:

The Board of Directors met four times during the financial year 2021-22 on 29th June, 2021, 14th August, 2021, 12th November, 2021 and 14th February 2022.

Details of attendance of Directors at the Board Meetings held during the financial year 2021-22 and the last Annual General Meeting (AGM) held on 28th September 2021 is as below:

Name of the Director Attendance at Board Meeting Attendance at AGM Dated
Held Attended 28th September 2021
Mrs. Sucharitha Reddy 4 3 No
Mr. C.Natarajan 4 4 Yes
Mr. Vijayakumar Reddy 4 1 No
Mrs. Suneeta Reddy 4 1 No
Mrs. Sindoori Reddy 4 4 No
Mr. G.Venkatraman 4 4 Yes
Mr. George Eapen 4 4 Yes
Mr. Suresh Raj Madhok 4 4 Yes

19. Committees of Board:

Your Board has constituted four Committees in compliance to the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee. Board also ensures separate meeting of Independent Directors without the presence of non-independent directors in compliance to the above provisions.

During the financial year 2021-22, following meetings of Committees were held:

i. Audit Committee met four times on 29th June, 2021,14th August, 2021,12th November, 2021 and 14th February 2022.

ii. Nomination & Remuneration Committee met twice on 29th June, 2021 and 14th February 2022

iii. Stakeholders Relationship Committee met once on 14th February 2022.

iv. Corporate Social Responsibility Committee met once on 14th February 2022.

v. Separate meeting of Independent Directors was held on 14th February 2022.

Details of attendance of Directors at the Committee Meetings held during the financial year 2021-22 is as below:

Name of the Directors Attendance at Committee Meeting Attendance at Independent Directors Meeting
Held Attended
Mrs. Sindoori Reddy 2 2 -
Mr. G.Venkatraman 7 7 Yes
Mr. George Eapen 7 7 Yes
Mr. Suresh Raj Madhok 6 6 Yes

19. Audit Committee:

Company has Audit Committee in compliance to the Section 177 of Companies Act, 2013 and SEBI (LODR) Regulations, 2015. There were no such incidences where the Board has not accepted the recommendations of the Audit committee during the year. The details about composition of the Audit Committee, its terms of reference, meetings, attendance, etc. have been provided in the Corporate Governance Report forming part of the Directors Report.

20. Nomination & Remuneration Committee:

Company has Nomination and Remuneration Committee in compliance to the Section 178 of the Companies Act, 2013 and SEBI (LODR) Regulation, 2015. The Company strongly believes that human resources which manage the other resources have infinite potential and therefore, their development is the key to organizational effectiveness. The Company commit to integrate human resources with organizational growth and development for mutual benefit.

The details about composition of the Nomination and Remuneration Committee, its terms of reference, meetings, attendance and all other details have been provided in the Corporate Governance Report forming part of the Directors Report.

21. Stakeholders Relationship Committee:

Company has Stakeholders Relationship Committee in compliance to the Section 178 of the Companies Act, 2013 and SEBI (LODR) Regulation, 2015. The Committee has been constituted to specifically look into various aspects of interest of shareholders, debenture holders and other security holders and resolve the grievances of security holders.

The details about composition of the Stakeholders Relationship Committee, its terms of reference, meetings, attendance and all other details have been provided in the Corporate Governance Report forming part of the Directors Report.

22. Corporate Social Responsibility Committee:

Company has Corporate Social Responsibility (CSR) Committee in compliance to the Section 135 of the Companies Act, 2013.

The details about composition of the CSR Committee, meetings and attendance have been provided in the Corporate Governance Report forming part of the Directors Report. A report on CSR as required is also provided separately forming part of this report.

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

(i) Conservation of Energy:

The Company values the significance of conservation of energy and hence continuous efforts are made for judicious use of energy at all levels of operations by utilizing energy efficient systems and processes. Towards achievement of this objective, steps have been initiated including use of energy efficient LED lights and energy management systems at our kitchen/offices. Further, certain initiatives are being implemented for optimization of electricity and LPG usage.

Some of the actions planned in phase number include replacement of energy intensive pumps with high efficiency systems, replacement of energy intensive fans with energy efficient fans. Operational measures include close monitoring and control of energy consumption and frequent energy audits by the hotel Engineering Department.

Your Company remains focused on giving importance towards conservation of energy, which results in savings of electricity consumption, a significant component of the energy cost, in an ongoing process. Company has not made any specific estimate of capital investment for energy conservation equipment.

(ii) Technical Absorption:

The Company continues to absorb and upgrade modern technologies and advanced hotel management techniques in various guest contact areas, which includes wireless internet connectivity in all the Guest House. The company has not imported any technology in last four years. Further, Company has not incurred any expenditure on research and development.

Particulars March 31, 2022 (Rs.) March 31,2021 (Rs.)
Outgo 16,54,153 21,67,777
Earned ---- ---

(iii) Foreign Exchange Earnings and outgo:

Foreign Exchange earned in terms of actual inflows and the Foreign Exchange outgo in terms of actual outflows during the year is as under:

24. Insurance:

All insurable interest of the Company including, buildings, furniture and fixtures and other insurable interest are adequately insured.

25. Auditors:

(i) Statutory Auditors:

M/s. P Chandrasekhar, Chartered Accountants, Statutory Auditors of the Company has been appointed at the 19th Annual General Meeting and holds office until the conclusion of 24th Annual General Meeting. The tenure of M/s P. Chandrasekhar, Chartered Accountants will expire in the ensuing Annual General Meeting. The Board in their meeting held on 29th July, 2022 recommended the re-appointment of M/s. P Chandrasekhar, Chartered Accountants as the statutory auditors of the Company to hold office from the conclusion of 24th Annual General Meeting till the conclusion of 29th Annual General Meeting of the Company.

(ii) Internal Auditors:

Pursuant to the provisions of Section 138 of the Companies Act, 2013 and The Companies (Accounts) Rules, 2014, the Company has appointed M/s. Viswanathan & Co, Chartered Accountant as Internal Auditors to undertake the Internal Audit of the Company for the FY 2021-22.

(iii) Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed BGSMISHRA & Associates, Company Secretaries LLP as Secretarial Auditors for the financial year 2021-22. The Secretarial Audit Report is attached forming part of the report.

(iv) Cost Auditor:

As per Section 148(1) of the Companies Act, 2013, the requirement of cost audit is not applicable to the company.

26. Internal Control Systems and their Adequacy:

The Company has an internal control system which commensurate with size, scale and complexity of its operations. Further, Company has appointed an external Internal Auditor. The scope and authority of the internal Audit function is well defined in the organization. To maintain its objectivity and independence, the Internal Auditor reports to the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal Audit function, process owners undertake corrective action in their respective areas and thereby strengthen the control. Significant audit observations and corrective actions suggested are presented to the Audit Committee of the Board.

27. Directors? Responsibility Statement:

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

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

(b) They have 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 financial year 31st March 2022 and of the profit and loss of the Company for that period;

(c) They have 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 Annual Accounts are prepared on a going concern basis;

(e) They have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and these systems are adequate and operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors and external consultant(s) and the reviews made by the Management and the relevant Committees, including the Audit Committee, Board is of the opinion that the Company?s internal financial controls were adequate and operationally effective during the financial year 2021-22.

28. Directors Appointment / Re-appointment:

In terms of the provisions of Section 152 (6) (d) of the Companies Act, 2013 Ms. Suneeta Reddy and Mr. P Vijaya- kumar Reddy, Directors of the Company retires by rotation at this Annual General Meeting and being eligible offer themselves for re-appointment.

Further, Company is seeking approval for re- appointment of Mr. C.Natarajan as Whole-time Director and Chief Executive officer at this Annual General Meeting for a period of six months from 30th May 2023. The Company is seeking approval of shareholder by way of special resolution as per the provisions of Section 196 read with Schedule V of Companies Act, 2013.

The Board, recommends his re-appointment as Whole-time Director and Chief Executive Officer.

29. Independent Directors:

Mr. Ganesan Venkatraman, Mr. Suresh Raj Madhok and Mr. Puthen Veetil George Eapen are Independent Directors on Board of the Company and has been appointed for a period of five years from 25th July 2019 to hold office till the conclusion of 26th Annual General Meeting of the Company. They have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013, which has been duly appraised and noted by the Board.

Company pays commission not exceeding 1% of net profit of the Company to the independent directors as approved by Board/ Nomination and Remuneration Committee. The details of the commission paid during the financial year is also provided in this report. Weblink of familiarization programme undertaken for IDs as available on website is http://www.apollosindoori.com/pdf/Details%20of%20familiarization%20programme%20imparted%20 to%20independent%20directors.pdf

30. Changes in Key Managerial Personnel:

During the year, Ms. Rupali Sharma, Company Secretary resigned and Ms. Surabhi Pasari got appointed as Company Secretary and Compliance Officer w.e.f 14.02.2022. There has been no other change in Key Managerial Personnel. Mrs. Sucharitha Reddy, Managing Director; Mr. C.Natarajan, Whole-time Director and Chief Executive Officer; Mr. Meyyappan Subramanian, Chief Financial Officer remain to be the key managerial personnel of the Company.

31. Particulars of Loans, Guarantees or Investments:

Company has made investment in Joint Venture and Wholly Owned Subsidiary, details of which is available in the form AOC - 1 provided in Annexure B. Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to the Financial Statements and may

be treated as forming part of the Directors Report.

32. Vigil Mechanism / Whistle Blower Policy:

Pursuant to Section 177(9) and 177(10) of the Companies Act, 2013, the Company has established vigil mechanism for the directors and employees to report genuine concerns. The Board of Directors have adopted Whistle Blower Policy.

The Whistle Blower Policy aims for conducting the affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. Directors and all permanent employees of the Company are covered under the Whistle Blower Policy. The Vigil (Whistle Blower) Mechanism aims to provide a channel to the Directors and employees to report genuine concerns about unethical behavior, actual or suspected fraud or violation of the Codes of Conduct or Policy or ethics.

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations and in order to maintain these standards, the Company encourages its employees who have genuine concerns about suspected misconduct to come forward and express these concerns without fear of punishment or unfair treatment.

The mechanism provides for adequate safeguards against victimization of Directors and employees to avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said Whistle-Blower Policy has been hosted on the website of the Company and is available at the website at weblink http://www.apollosindoori.com/pdf/Details%20of%20establishment%20of%20vigil%20mechanism_Whis- tle%20Blower%20policy.pdf

33. Policy on Director?s appointment and remuneration:

The policy of the Company on Director?s appointment and remuneration, including the criteria for determining qualifications, positive attributes, independence of a director and other matters, as required under Section 178 of the Companies, Act, 2013 is available at the website at weblink http://www.apollosindoori.com/pdf/Nomination%20 and%20Remuneration%20Policy.pdf

34. Board Evaluation:

As per the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI (LODR) Regulations, 2015, the evaluation process for the performance of the Board, its committees and individual directors are carried out internally. Each Board member submitted a detailed evaluation form 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 judgment, decision making, management actions etc.

One-on-one meeting of the individual directors with the Chairman of the Board was also conducted as a part of self-appraisal and peer group evaluation and the engagement and impact of individual directors was reviewed on parameters such as contribution, attendance, decision making, inter-personal relationship, actions oriented, external knowledge, etc. 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 14th February 2022 to review the performance evaluation of non-independent directors, Board including the Chairman, while considering the views of the Executive and Non-Executive Directors. The independent directors were satisfied with the overall functioning of the Board, its various Committees and other non-executive and executive directors. The Board expressed its satisfaction with the Evaluation results, which reflects the high degree of engagement of the Board and its Committees with the company and its management.

35. Compliance to Secretarial Standards:

The company has complied with the Secretarial Standards SS-1 and SS-2 issued by the Institute of Company Secretaries of India on Board Meetings and General Meetings. Company also endeavor and ensure compliance of other secretarial standards.

36. Risk Management Policy:

Risk Management is an integral part of the business process. The risk management process, inter alia provides for review of the risk assessment and mitigation procedures and timely report to the management and review of the identified risks at periodical interval to assess the progress of control measures.

The Audit Committee and the Board reviews the risk management efforts periodically. The Committee has formulated a Risk Management Policy which is uploaded on the Company?s website at weblink http://www.apollosin- doori.com/pdf/Risk%20Mgt%20Policy.pdf Risk Management Policy of the Company outlines different kinds of risks and risk mitigating measures. The risks are reviewed for the change in the nature and extent of major risks identified since the last assessment. It also provides control measures for risks and future action plans. Your Board is satisfied that there are adequate systems and procedures in place to identify, assess, monitor and manage risks. The Company believes that the overall risk exposure of present and future risks remains within its risk capacity.

37. Receipt of Commission by MD / WTD from Company or Subsidiary:

During the financial year 2021-22, Managing Director / Whole-time Director of the Company has not received any commission from Company or Subsidiary of the Company.

38. Human Resources:

Your Company takes pride in the commitment, competence and dedication shown by its employees in all areas of its business. It considers people as its biggest assets. It has put concerted efforts in talent management and succession planning practices, strong performance management and learning and training initiatives to ensure that your Company consistently develops inspiring, strong and credible leadership. Your Company has a structured induction process at all its locations and management development programs to upgrade skills of managers.

39. Statutory Auditors Report:

The Standalone as well as Consolidated Financial Statements are accompanied with the Statutory Auditors Report. The Auditors Report do not contain any qualification/ observations. The Auditors Report read with the Notes and Schedules to Accounts forming part of the financial statements are self-explanatory.

40. Reporting of Frauds by Auditors:

During the year under review, neither the Statutory Auditors nor the Internal Auditors has reported to the Audit Committee under Section 143(12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees.

41. Secretarial Auditors Report:

A detailed Secretarial Auditors Report is provided in Annexure- D.

The reply to the observation provided in Secretarial Audit Report is as under:

i. Observation: Certain compliances as required to be made under Secretarial Standard in relation to Board / Committee Meetings has been missed

Company Representation: Owing to restrictions imposed due to COVID-19 such as meetings being carried out through video conferencing and Directors attending the same remotely, posed challenges leading to improper compliance of Secretarial Standards in few cases.

Observation: The majority of the revenue of the Company is from related party transaction which as per the representation from the Company is in ordinary course of business and on arm?s length basis Company Representation: The Company is providing clinical nutritional services to several hospitals and many of them are related parties. However, Company is also providing these services to other non-related parties as well at the same terms and conditions. All these transactions are in the ordinary course of business and at arm?s length basis. Since majority of the customer are related parties, major revenue is from related

party transactions. Hence, this is statement of fact and do not point out to any violation. Further, these related party transactions are entered into, after due approval of Audit Committee as required under Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The Company has also obtained the approval of members by means of Special Resolution passed in Annual General Meeting held on 28th Sep, 2021.

iii. Observation: The gap between two meetings of the Board and Audit Committee dated 13th February 2021 and 29th June 2021 is beyond 120 days and is at variance to the provisions of Regulation 17 and 18 of SEBI (LODR) Regulations, 2015

Company Representation: The Ministry of Corporate Affairs vide its Circular No. 08/2021 dated 03-05-2021 extended the gap between two Board meetings to 180 days during the quarter Apr-June 2021 and Ju- ly-Sept 2021 instead of 120 days. Hence, the same was duly complied as per the provisions of Companies Act, 2013. However, the Company mistook it, to be a compliance as per SEBI (LODR) Regulations, 2015 as well. This is an inadvertent mistake on part of the Company.

iv. Observation: The intimation to stock exchange for Board Meeting for approval of the financial results for the financial year 2020-21 dated 29th June 2021 has been made with four (4) days clear days prior notice as against the five (5) clear days (excluding date of intimation and date of meeting) required under Regulation 29 of SEBI (LODR) Regulations, 2015

Company Representation: The alleged non-compliance was totally unintentional and arose due to unfortunate situation of the previous Company Secretary being not available in station due to the sudden demise of (mother) close family member due to Covid. Owning to the pandemic, NSE has also not levied any penalty.

v. Observation: The intimation to stock exchange for consideration of declaration dividend at the Board dated 29th June 2021 has been made with one (1) working days prior notice as against the two (2) working days (excluding date of intimation and date of meeting) required under Regulation 29 of SEBI (LODR) Regulations, 2015 and National Stock Exchange as per the Standard Operating Procedure vide SEBI Circular SEBI/HO/CFD/CMD/CIR/P/2020/12 dated 22 January 2020 has levied a fine of Rs.10,000/-, which has been paid by the Company

Company Representation: The alleged non-compliance was totally unintentional and the Company has paid a penalty of Rs. 11,800 (including GST) to National Stock Exchange.

vi. Observation: Continued disclosure as required under Regulation 30 of SEBI (SAST) Regulations, 2011 has been submitted beyond the timeline of the seven working days on 12th April 2021

Company Representation: The alleged non-compliance was totally unintentional and the delay was caused due to concerned staff working from home and covid cases at office. However, NSE has ignored the same and levied no penalty.

42. Managerial Remuneration:

Disclosures pursuant to Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been provided in Annexure E.

43. Disclosure as per Listing Regulations:

Disclosures pursuant to Regulation 34 read with Schedule V of the SEBI (LODR) Regulation, 2015 has been provided in Annexure F.

44. Corporate Governance:

As per Schedule V of SEBI (LODR) Regulation, 2015, a separate section on corporate governance practices followed by the Company, report on Corporate Governance together with a certificate confirming compliance on corporate governance provisions and CEO/CFO Certificate forms an integral part of this Directors? Report and has been provided in Annexure G

45. Management Discussion and Analysis Report:

Management discussion and analysis report forming part of directors? report pursuant to Regulation 34 read with Schedule V of the SEBI (LODR) Regulation, 2015 has been provided in Annexure H.

46. Particulars of Employees:

The Company has about 4193 employees in its roll. Since employees contribute in achieving the goal of the Company, periodical training programs are carried out to meet the challenges in providing services to the best of Customer Satisfaction.

47. Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013:

The Company has a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace and matters connected therewith or incidental thereto covering all the aspects as contained under The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013. During the year under review, the Company has not received any complaints under the Policy.

48. Transfer to Investor Education and Protection Fund:

The disclosure related to Investor Education and Protection Fund (IEPF) has been made in the notice to the Annual General Meeting. It contains details of the transfer of the unclaimed/ unpaid dividend, year wise, which are liable to be transferred to the IEPF. The details are also available on the website of the Company.

49. Application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016

As per the information of the Company as on date of this report, no proceeding is pending against the Company under the Insolvency and Bankruptcy Code 2016.

50. Companies (Auditor?s Report) Order, 2020

The Report as provided is self- explanatory.

51. Acknowledgement:

Your Directors take this opportunity to thank the Company?s customers, shareholders, suppliers, bankers, financial institutions and the Central and State Governments for their unstinted support. The Directors would also like to place on record their appreciation to employees at all levels for their hard work, dedication and commitment.

Place: Chennai For and on Behalf of Board of Directors
Date: 12th August, 2022 Sucharitha Reddy G. Venkatraman
Managing Director Chairman