Coromandel Inter Director Discussions


Dear Members,

The Board of Directors of your Company has pleasure in presenting the 61st Annual Report on the operational and business performance of the Company together with the Audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2023.

1. S tandalone Financial Highlights

Rs. in Crores
Particulars FY 2022-23 FY 2021-22
Revenue
From Operations 29,609.55 19,088.26
Other Income 174.76 143.17
Total Revenue 29,784.31 19,231.43
Profit
Profit before Interest, Depreciation and Taxation 3,092.52 2,178.86
Less: Interest 189.28 75.43
Less: Depreciation 181.20 172.02
Profit Before Tax 2,722.04 1,931.41
Less: Provision for Tax (including deferred tax) 687.37 518.96
Profit After Tax 2,034.67 1,412.45

Your Companys Revenue from Operations for the year was Rs. 29,609.55 Crores as against Rs. 19,088.26 Crores last year.

The Profit before Interest, Depreciation, and Taxation grew to Rs. 3,092.52 from Rs. 2,178.86 Crores in the previous year registering a growth of 42% year-on-year (YoY). The Net Profit for the year grew to Rs. 2,034.67 Crores from Rs. 1,412.45 in the previous year, i.e., recording an increase of 44% YoY. The EBITDA margin decreased 81 basis points to 9.85%, and the PAT margin decreased 53 basis points to 6.87% in FY 2022-23 over the previous reporting period. The Earnings Per Share (EPS) for the year stood at Rs. 69.25 per share compared to Rs. 48.14 per share for the previous year.

Your Company proposes to retain Rs. 2,034.67 in the Statement of Profit and Loss, and not transfer it to the General Reserve.

2. B usiness Environment

G lobal & Indian Economy

T he worldwide economic system has managed to significant positive strides despite the difficulties posed by the pandemic, but it faced headwinds arising out of ongoing geopolitical rift in Europe, volatility in commodity prices, and a slowing growth scenario across nations. World Bank estimates that the global economy has grown by 3.4% in 2022. Outlook for world economy is signalling weakness with persisting inflationary pressure and hawkish monetary policies adopted by the central banks.

India growth story remains intact as against the prevailing global macroeconomic environment with World Bank estimates suggesting GDP growth to be

6.9% during FY2023. Even though inflation breached the threshold in the first half of the year, the Reserve

Bank of Indias careful strategy, combined with a reduction in global commodity prices, brought it down to comfortable levels by year-end. Major economic indicators including exports, gross GST collections, etc. have improved in comparison to last year. Foreign exchange reserves continue to remain healthy, touching ~USD 580 bn as on 31st March 2023. India took on the G20 Presidency for the first time during the year, reiterating its significant stature in the global economy.

With favourable government policies, substantial capital investments, and economic resilience, India is expected to have a dominant position in the global economy in the coming years.

Agriculture

I ndian agriculture has grown at average growth rate of 4.6% per annum during the last six years, ably supported by government measures and enhanced investments in infrastructure. The country also experienced strong Kharif and Rabi seasons with above normal monsoon. As a result, total foodgrain production is expected to touch 323 million MT during FY2023 (2.5% growth over previous year).

I ncome support schemes by Central and State governments, expansion of pan-India electronic trading system for agri produce, implementation of Cluster Development Programme, establishment of Agriculture Infrastructure Fund and other similar measures boosted farm income and enhanced Indias agricultural competitiveness. In addition to these, government is also promoting the adoption of latest technology in agricultural practices such as drone-based spraying which has significant potential in improving farm productivity and offering minimal environmental footprint.

India has the capability to become the major supplier of food for the world with its immense agricultural resources and growth potential. However, this will require continued investments towards faster adoption of technology, infrastructure enhancement, development of sustainable solutions, as well as effective policies and support for farming community to ensure long-term success.

3. P erformance Review

C oromandel delivered a robust performance

FY2023 registering good growth in terms of revenue and profitability. The manufacturing plants maintained high levels of efficiency while prioritizing the safety of their operations. With a view to strengthen its upstream integration capabilities and operational flexibility, the company undertook strategic investments in Nutrients and Crop Protection businesses. It also prioritized technology & sustainability led investments and during the year, acquired stakes in three Ag-tech startups. The company continued its integrated crop management approach and worked closely with the value chain players to ensure timely availability of agri inputs and services to the farming community.

Fertiliser

C oromandels fertiliser business posted a performance during FY2023, strengthening its sales & marketing presence, manufacturing infrastructure, supply chain agility and new product development capabilities. The company continued to strengthen its existing business through backward integration, thus ensuring long-term raw material supply security.

Coromandel acquired 45% stake in Baobab Mining and

Chemicals Corporation (BMCC), Senegal, which is likely to support the companys rock phosphate requirement. In addition to this, the commissioning of Sulphuric Acid plant is progressing and shall be completed in FY2024.

The fertiliser manufacturing plants operated at more than 90% capacity utilization and achieved a growth of 14% over previous year to post production volume of ~3.3 million MT. Single Super Phosphate (SSP) production volume grew by 19% to 8.6 lakh MT by resuming operations in Pali (Maharashtra) and capacity enhancement at Ennore (Tamil Nadu) via tolling arrangement. The company also continued its unwavering focus on ensuring safe operations and Total

Recordable Incident Rate (TRIR) for the year was 0.41 per million manhours.

In FY2023, primary sales volume of DAP & Complex fertilisers and SSP equalling 36.5 lakh MT and 8.1 lakh MT respectively was achieved by the business. Coromandel also supported the government by establishing Pradhan Mantri Kisan Samruddhi Kendras (PMKSKs) within its key geographies. These shall serve as one-stop shop for farmers by offering varied agri-inputs and farm advisory solutions. The company developed a nanotechnology-based fertiliser product, Nano DAP, which provides the farmers a sustainable solution in increasing nutrient uptake. Integrated nutrient marketing structure supported by the agronomist team and Nutriclinics continue to support the business in promoting its balanced nutrition approach and market development initiatives.

The sourcing team was able to ensure on-time availability of critical raw materials and overcome prevailing pricing pressures in the market through implementation of optimal buying strategy and diversification of sources.

The company was also able to unlock additional capacity through process and feedstock optimization.

A Centre of Excellence (CoE) for manufacturing was set up at Visakhapatnam that focuses on real-time monitoring of production parameters and identifying efficiency improvement initiatives. This, along with multiple digital interventions across varied functions, reiterates Coromandels focus on ‘Digital at the core of its operations.

Sp ecialty Nutrients

S peciality Nutrients business promotes balanced nutrition, offering a product portfolio comprising of bentonite sulphur, water-soluble fertilisers, micronutrients, liquid fertilisers, organic soil health restoring agents, plant-based biostimulants, organic manures, organic Potash, etc. During the year, the business focused on capacity building initiatives and was able to register robust growth.

3 n ew products were launched in FY2023 – ‘AcuMist Calcium, ‘Gardina – Soil Conditioner and ‘Gardina – Growth Booster, the latter two catering to urban gardening segment. With the aim of empowering farmers by providing access to the latest technologies available in the market, the business piloted the drone project ‘Gromor Drive and offers soil, water & leaf testing services via Nutri-Clinics.

Infrastructure enhancement projects were carried out in its liquid fertiliser plant at Visakhapatnam and at the same time, the business has been making continuous effort in de-risking procurement through diversifying its sources.

C rop Protection

C rop Protection Chemicals business clocked a growth of 5% this year. Domestic B2B and formulations business, especially new and speciality products, have exhibited good performance.

A Multi-Product facility was set up at Ankleshwar during the year, which aids the business in diversifying its product portfolio. This year also saw the introduction of 5 new formulation products (including 3 novel combinations) and 2 new agrochemical technicals.

In FY2023, the business embarked on a manufacturing excellence program and undertook operational efficiency improvement initiatives across its manufacturing plants yielding significant cost savings and reasonably protecting margins across key products. It maintained a strong emphasis on ensuring safety across its operations, and Total Recordable Incident Rate (TRIR) for the year improved significantly to 0.24 per million manhours.

The business strengthened its sourcing capabilities by developing new vendors and is improving its backward integration capabilities. It is working on a rich pipeline of new molecules and combination products.

As part of its long-term strategy, Crop Protection

Chemicals business, has announced its expansion plans of foraying into CDMO and Specialty & Industrial chemical segments, which offer significant growth potential.

Bioproducts

T he Bioproducts business registered lower comparison to previous year owing to poor neem seed season and resulting challenges in procurement. However, business was able to partially pass through the raw material impact resulting in stable profitability during the year.

The business has been able to consistently produce

Azadirachtin of superior purity through manufacturing innovation and ensuring adherence to stringent raw material quality norms. The R&D team has undertaken development of microbial products and plant extract-based biostimulants, which forms a key element of the business diversification strategy.

Retail

W ith a network of 751 rural retail stores across

Pradesh, Telangana and Karnataka, the business focuses on providing diverse range of products and services to farmers. The business also offers expert advice to the farming community via its ‘Scientist-at-Store initiative.

During the year, Retail business adopted a crop focused approach to drive customized crop recommendations and farm advisory. It closely partnered with agritech startups and solution providers for promoting adoption of pest and weather prediction technologies, drone-spraying, cold storage, digital farming, etc.

A gTech Investments

Du ring the year, Coromandel made investments in three ag-tech startups that are dedicated to providing advanced agricultural solutions.

Ecozen Solutions Pvt. Ltd. provides advanced renewable energy-based solutions that can help farmers reduce post-harvest losses, thus empowering the agriculture sector.

String Bio Pvt. Ltd. is a startup in the field of biotechnology that specializes in developing a distinctive array of fermentation-based products for use in various segments such as agriculture, animal nutrition, human nutrition, and personal care.

Dhaksha Unmanned Systems Pvt. Ltd. focuses on drone technology and offers a comprehensive set of solutions for Unmanned Aerial Systems (UAS) in a variety of applications, from agriculture to surveillance.

4. F inance

Y our Company continued to focus on managing cash efficiently and ensured that it had adequate liquidity and back-up lines of credit. With higher raw material prices, the Working capital of the Company increased during in the year; this was partially offset by improved market collection and higher subsidy receipts. Net Cash from Operations for the year stood at Rs. 560 Crores.

Your Company has been credit rated by CRISIL Limited (CRISIL) and India Ratings & Research Private Limited (India Ratings & Research). The Companys long-term credit rating by CRISIL has been upgraded to ‘CRISIL AAA (Stable) and short-term debt rating stands at ‘CRISIL A1+. The Companys long-term credit rating by India Ratings & Research has been upgraded to ‘IND AAA (Stable) and short-term debt rating stands at ‘IND

A1+. This reflects a very strong (highest) degree of safety regarding timely servicing of financial obligations and a vote of confidence reposed in your Companys financials.

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

5. Di vidend

T he Board is pleased to recommend a final

Rs. 6/- per equity share of Re. 1 each. The Board had earlier approved payment of interim dividend of Rs. 6/- per equity share at its meeting held on February 2, 2023, which was paid to the Members of the Company on

February 28, 2023. The total dividend for the financial year ended March 31, 2023 would, accordingly, be Rs. 12/- per equity share of Re.1 each. The total outgo on account of the dividend for the year would be Rs. 352.81 crores, including tax deducted at source (TDS). The Company has adopted Dividend Distribution Policy in line with the requirements of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations). The Dividend Distribution Policy is available on the website of the Company at https://www.coromandel.biz/investors/policies/

6. C onsolidated Financial Results

T he consolidated financial statements, which prepared in accordance with the provisions of the Companies Act, 2013 (‘the Act) and the relevant accounting standards, form part of this Annual Report. As required under the provisions of the Act, a statement showing the salient features of the financial statements of the subsidiaries, associates and joint ventures is enclosed as Annexure A to this Report.

The financial statements of the subsidiary companies will be made available to the members of the Company on request and will also be kept for inspection at the

Registered Office of the Company.

7. S ubsidiary Companies

B rief details of the performance of the subsidiaries the Company are given below:

i. C oromandel Chemicals Limited (CCL) [Formerly Parry Chemicals Limited]:

C CL, a wholly owned subsidiary of the Company, a total income of Rs. 2.18 crore for the year ended March 31, 2023, and Loss after tax was Rs. 5.57 crore.

During the year under review, CCL acquired 45% equity stake in Baobab Mining and Chemicals Corporation SA, Senegal (BMCC) at a consideration of USD 19.6 million and also extended a loan of USD 7 million to BMCC for capital projects and expansion. This strategic investment in mining operation is being made by the Company through CCL to strengthen its backward integration and secure long-term supply of rock phosphate, which is one of the key raw materials for the Company. The Company infused equity into and advanced loan to CCL to finance the above strategic investment.

ii. D are Ventures Limited (DVL) [Formerly Dare ofInvestments Limited):

D VL, a wholly owned subsidiary of the Company, earned a profit of Rs. 0.04 crores for the year ended March 31, 2023.

DVL is a corporate venture capital arm of the Company with a focus on leading investments in early to growth stage start-up companies engaged in providing technology led solutions for complex and long-term problems in the agriculture and allied sectors.

The details of investments made by DVL in AgTech startups Companies during the financial year 2022-23 are as under:

Ecozen Solutions Private Limited (Ecozen)– DVL invested Rs. 10 Crores during the financial year 2022-23 in Ecozen.

are Ecozen develops climate-smart deeptech solutions and core technology stacks to deliver a sustainable future, including motor controls, IoT, and energy storage.

String Bio Private Limited (String Bio) – DVL invested

Rs. 16.49 Crores during the financial year 2022-23 in

String Bio.

With a vision to build a world where cleaner and better ways of living are enabled by biotechnology, String Bio has developed a set of next generation products across different sectors to deliver such solutions.

In agriculture, String Bio has developed several bio stimulant products targeting horticulture as well as large of acreage crops.

Dhaksha Unmanned Systems Private Limited (Dhaksha)

DVL invested Rs. 19.99 Crores during the financial year 2022-23 in Dhaksha.

Dhaksha, one of the forerunners in the drone space in India, provides a complete range of Unmanned Aerial Systems (UAS) technology solutions for different applications covering agriculture, defence, surveillance and delivery, among others.

iii. C oromandel Technology Limited (CTL)

C TL was incorporated on December 27, 2022 as a wholly owned subsidiary of the Company. CTL did not have any operation during the financial year 2022-23.

iv. C FL Mauritius Limited:

C FL Mauritius Limited, a wholly owned incurred a loss of USD 0.04 million (equivalent to Rs.0.32 crore) during the year ended March 31, 2023. The primary source of income for this subsidiary is dividend income from Foskor (Pty) Ltd. and the subsidiary did not receive any dividend from Foskor during the financial year 2022-23.

v. C oromandel Brasil Limitada (CBL):

C BL, a Limited Liability Partnership, owned 100% the Company and its subsidiary CFL Mauritius Ltd, is primarily engaged in getting product registrations in Brazil and procuring orders for supplies from India. It earned a loss of Brazilian Reals 0.32 million (equivalent to Rs.0.49 crore) for the year ended March 31,2023.

vi. C oromandel Australia Pty Ltd (CAPL) [Formerly Sabero Australia Pty Ltd]:

C APL did not have any significant operation during year ended March 31,2023. It earned a loss of Australian Dollar 0.01 million (equivalent to Rs.0.07 crore) for the year ended March 31,2023.

vii. S abero Organics America SA (SOAL):

S OAL is primarily engaged in getting product in Brazil and procuring orders for supplies from India.

It incurred a net loss of Brazilian Reals 0.34 million (equivalent to Rs.0.52 crore) for the year ended March 31, 2023.

viii. S abero Europe BV (SEBV):

S EBV was liquidated voluntarily during the year, was not undertaking any business operations and had no plans for the future. Voluntary liquidation of SEBV was approved by the Chamber of Commerce, Netherlands with effect from May 25, 2022 and, accordingly, SEBV ceased to be a wholly owned subsidiary of the Company from that date.

ix. C oromandel Agronegocios De Mexico SA de

(Coromandel Mexico):

C oromandel Mexico is primarily engaged in product registrations in Mexico and procuring orders for supplies from India. It earned a net profit of Mexican Peso 0.09 million (equivalent to Rs. 0.04 crore) for the year ended March 31, 2023.

x. S abero Argentina SA (Sabero Argentina):

S abero Argentina is primarily engaged in getting registrations in Argentina and procuring orders for supplies from India. It did not have significant operation during the year ended March 31, 2023.

xi. Pa rry America Inc.:

P arry America Inc. is primarily engaged in the sale of bio-pesticides in America. It made a net profit of USD

1.18 million (equivalent to Rs.9.45 crore) for the year ended March 31, 2023.

xii. C oromandel International (Nigeria) Limited

(CINL):

C INL is engaged in getting product registrations in

Nigeria and procuring orders for supplies from India. by It made a net profit of Naira 2.27 million (equivalent to Rs.0.04 crore) for the year ended March 31, 2023.

xiii. C oromandel Mali SASU (CMS):

C oromandel Mali SASU (CMS) was incorporated on

February 04, 2020 as a Wholly Owned Subsidiary (WOS) of the Company for the purpose of obtaining registration for marketing of agrochemicals. CMS is registered with Ministry in Charge of Statistics, Republic of Mali and is the yet to commence its business operations.

Associate Company

(i) Sabero Organics Philippines Asia Inc (SOPA)

SOPA, an associate company based in Philippines, did not have any significant operation during the year ended

March 31, 2023.

(ii) Baobab Mining and Chemicals Corporation SA, Senegal (BMCC)

During the financial year 2022-23, your Company made a strategic investment in BMCC through its wholly owned subsidiary, Coromandel Chemicals Limited. (CCL) by way of acquisition of equity shares in BMCC, and infusing it loan in it. CCL currently holds 45% equity in BMCC.

BMCC is a registered corporate entity in Dakar, Republic of Senegal (West Africa) and has been engaged in the business of mining, production and sale of Rock Phosphate, one of the key raw materials used in manufacturing of phosphoric acid, which in turn is used in manufacturing of complex fertilizers.

The Company has made this strategic investment in

BMCC to secure supply of Rock Phosphate, on a long-term and sustainable basis.

Joint Venture Company

Brief details of the performance of the Yanmar Coromandel Agrisolutions Private Limited (YCAPL), Joint Venture (JV) company is given below:

YCAPL, a Joint Venture company between the Company, Yanmar & Co. Ltd, Japan, and Mitsui & Co. Ltd, Japan, is into sales and service of agri-tech equipment focussed on farm mechanization in India. YCAPL has been consolidating its position as amongst the market leaders in India in the Combine Harvester and Rice Transplanter segments. The total income for the year was Rs. 127.74 crore and the net profit was Rs. 3.22 crore.

Strategic Investment(s):

Brief details of the performance of the Strategic Investment companies are given below:

i. Tunisian Indian Fertilisers S.A., Tunisia (TIFERT):

TIFERT, a company based in Tunisia, manufactures phosphoric acid which is a key raw material for operating Phosphatic Fertiliser plants. Your Companys strategic investment in TIFERT (15% equity) is aimed at securing supply of phosphoric acid for the Companys operations at Kakinada and Visakhapatnam. During the year, TIFERT operations were impacted by the other social and technical issues. Indian partners, Coromandel and GSFC, continue to provide necessary technical support to TIFERT to improve the plant performance.

ii. Foskor (Pty) Limited, South Africa (Foskor):

The Company, along with CFL Mauritius Limited, holds 14% equity in Foskor. Foskor supplies high-quality phosphoric acid and rock phosphate, which is used for phosphatic fertiliser manufacturing at Kakinada and Ennore plants of your company. The financial performance of Foskor improved during the year with efficient mining operations resulting in higher rock production. The Company is working with the Foskor team on a business turnaround plan and is providing technical assistance for improving acid production and plant efficiency.

8. R isk Management Policy

T he Company has constituted a Risk

Committee, as per the details set out in the Corporate Governance Report. The Company has formulated a Risk Management Policy to ensure risks associated with the business operations are identified and risk mitigation plans put in place. Details of the key risk associated with the business are given in the Management Discussion and Analysis Report.

9. I nternal Financial Control Systems their adequacy

T he Company has adequate internal controls with the nature of business and size of the operations, to effectively provide for safety of its assets, reliability of financial transactions with adequate checks and balances, adherence to applicable statues, accounting policies, approval procedures and to ensure optimum use of available resources. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis.

The Company has its own corporate internal audit function to monitor and assess the adequacy and effectiveness of the Internal Controls and System across all key processes covering various locations. Deviations are reviewed periodically, and due compliance ensured.

Summary of Significant Audit Observations along with recommendations and its implementations are reviewed by the Audit Committee and concerns, if any, are reported to the Board.

10. R elated Party Transactions

A ll related party transactions were placed before the

Audit Committee for approval. Prior omnibus approval of the Audit Committee was obtained for the transactions which are foreseen and are repetitive in nature. The related party transactions entered into by the Company are reviewed by independent chartered accountants to confirm that they were in the ordinary course of business and on an arms length basis. Form AOC-2 will not form part of Boards report, as all the transactions with related parties are in arms length basis and in ordinary course of business. There are no materially significant related party transactions during the year which may have a potential conflict with the interest of the Company at large.

Related party transactions as required under the Indian

Accounting Standards are disclosed in Notes to the financial statements of the Company for the financial year ended March 31, 2023. The Policy on Related Party Transaction is available on the Companys website at https://www.coromandel.biz/investors/policies/ None of the Directors had any pecuniary relationship or transactions with the Company except the payments made to them in the form of remuneration, sitting fee, commission and reimbursement of expenses, if any.

11. Auditors

i. S tatutory Auditors and their report

M /s. S.R. Batliboi & Associates LLP (Reg. No. FRN

101049W/E300004) were appointed as the Statutory

Auditors of the Company to hold office from the conclusion of 59th Annual General Meeting until the conclusion of the 64th Annual General Meeting of the Company.

As required under Regulation 33 of the Listing

Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Auditors Report given by M/s. S.R. Batliboi & Associates LLP on the financial statements of the Company for the year ended March 31,2023, forms part of the Annual Report. The Auditors Report does not contain any qualification, reservation or adverse remark. During the year under review, the Auditors did not report any matter under Section 143(12) of the Act.

Therefore, no detail is required to be disclosed under

Section 134(3)(ca) of the Act.

ii. C ost Auditors and their report

P ursuant to Section 148 of the Act read with Companies (Cost Records and Audit) Rules, 2014 and amendments thereof, the Company is required to maintain cost accounting records in respect of certain specified products and accordingly such accounts and records are made and maintained in the prescribed manner. The cost accounting records maintained by the Company are required to be audited and accordingly M/s. Narasimha Murthy & Co., and Mrs. Jyothi Satish were appointed as Cost Auditors for the financial year 2022-23.

On the recommendation of the Audit Committee, the Board has re-appointed M/s. Narasimha Murthy & Co., Cost Accountants and Mrs. Jyothi Satish, Cost Accountant as Cost Auditors for auditing the cost records of the Company for the financial year 2023-24. The Act mandates that the remuneration payable to the Cost

Auditor is ratified by the shareholders. Accordingly, a resolution seeking ratification of the shareholders for the remuneration payable to the Cost Auditors for the financial year 2023-24 is included in the Notice convening the 61st Annual General Meeting.

During the year, the Company filed the Cost Audit Report for the financial year 2021-22 with the Ministry of Corporate Affairs within the prescribed time limit.

iii. S ecretarial Auditor and their report

P ursuant to the provisions of Section 204 of the and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Board had appointed M/s. R Sridharan & Associates, Practicing Company Secretaries, to undertake the secretarial audit of the Company for the financial year 2022-23.

The report of the Secretarial Auditor is enclosed as Annexure B and forms part of this report. The Secretarial

Audit Report does not contain any qualification, reservation, or adverse remark.

In terms of Regulation 24A of the Listing Regulations, there is no material unlisted subsidiary incorporated in India. Material unlisted subsidiary for the purpose of the said Regulation is a subsidiary whose income/ net worth exceeds 10% of the consolidated income/net worth respectively of the Company and its subsidiaries in the immediately preceding accounting year. Hence, there is no requirement of a secretarial audit for any of the Companys subsidiaries in India.

12. B oard, Committees of the Board and other information

i. D irectors

Y our Company is managed and governed by a Board the comprising an optimum blend of Executive and Non-Executive Directors. As on March 31, 2023, the Board of Directors comprised of eleven (11) Directors, consisting of Executive Vice Chairman, two (2) Whole-time Directors and eight (8) Non-Executive Directors, out of which six (6) Directors were Independent Directors, including two Woman Directors. The composition of the Board is in conformity with Regulation 17 of the Listing Regulations and the relevant provisions of the Act. The Directors possess requisite qualifications and experience in general corporate management, strategy, finance, engineering, information technology and other allied fields which enable them to contribute effectively to the Company in their capacity as Directors of the Company.

Mr. Sameer Goel superannuated from the services of the Company and, consequently, ceased to be the Managing Director of the Company with effect from close of business hours on January 31, 2023. The Board placed on record its appreciation of the significant contribution made and valuable services rendered by Mr. Sameer Goel during his tenure.

During the year, Dr. Deepali Pant Joshi (DIN:07139051) was appointed as Additional Director and designated as Non-Executive Independent Director. Mr. Sankarasubramanian S. (DIN: 01592772) was appointed as Additional Director, and designated as Act

Executive Director – Nutrient Business. Dr. Raghuram Devarakonda (DIN:09749805) was appointed as Additional Director and designated as Executive Director – CPC, Bio and Retail Business of the Company. The above appointments were made effective from

February 1, 2023, for a term of five (5) years, subject to approval of shareholders of the Company.

Subsequently, the shareholders through postal ballot on December 29, 2022, approved the appointment of Dr. Deepali Pant Joshi as Independent Director, Mr. Sankarasubramanian S. as Executive Director – Nutrient Business, and Dr. Raghuram Devarakonda as Executive Director – CPC, Bio and Retail Business of the Company for a term of five years, effective from

February 1, 2023.

In accordance with Article 17.29 of the Companys Articles of Association, read with Section 152 of the Act, Mr. M. M. Venkatachalam, Director (DIN: 00152619) retires by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment.

ii. B oard Meetings

T he annual calendar of the board meetings is and circulated to the Directors in advance. During the financial year 2022-23, seven (7) Board Meetings were held, the details of which are given in the Corporate Governance Report.

iii. I ndependent Directors and their declaration of Independence

A s on March 31, 2023, the Independent of the Company included Mr. Sumit Bose, Ms. Aruna B. Advani, Mr. K V Parameshwar, Dr. R Nagarajan, Mr. Sudarshan Venu and Dr. Deepali Pant Joshi. All the Independent Directors of the Company have furnished necessary declaration in terms of Section149(7) of the Act and Regulation 25(8) of Listing Regulations affirming that they meet the criteria of independence as stipulated under the Act and Listing Regulations. All the Independent Directors of the Company have registered on the Independent Directors Databank as required under the Act and the applicable Rules in the said regard. In the opinion of the Board, all the Independent Directors have the integrity, expertise and experience including the proficiency required to effectively discharge their roles and responsibilities in directing and guiding the affairs of the Company.

iv. F amiliarization Programmes for Independent Directors

T he Independent Directors of the Company are professionals with several decades of experience in banking and financial services, technology, finance, governance and management areas, and fully conversant and familiar with the business of the Company.

The Company has an ongoing familiarization programme for all Independent Directors with regard to their roles, duties, rights, responsibilities in the Company, nature of the industry in which the Company operates, the business model of the Company, etc.

The Independent Directors, on their appointment, are made familiar about the Companys operations and businesses. Interaction with the senior leadership team (Business Heads and key executives) of the Company is also facilitated. Detailed presentations on the business of each of the Division are made to the Directors from time to time. A manual containing all important policies of the Company is given to the Directors. Meetings with the Chairman, Executive Vice Chairman and the Managing Director / Executive Directors are facilitated for the new appointee to familiarise him/ her about the Company, its businesses and the practices and policies of the Group.

As part of the familiarization programme, a handbook is provided to all the Directors including Independent Directors at the time of their appointment. The handbook provides a snapshot to the Directors of their duties and responsibilities, rights, appointment process and evaluation, compensation, board procedure, and stakeholders expectations. The handbook also provides the Directors with an insight into the Groups practices. Further, periodic emails are sent to all the Directors covering events that may have an impact on the business of the Company and/ or the agriculture sector in general and fertiliser and crop protection industries, in particular. The details of the familiarization programme are also disclosed on the Companys website at https:// www.coromandel.biz/investors/policies/

v. R emuneration Policy

O n the recommendation of the Nomination and

Remuneration Committee, the Board has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. Salient features of the Remuneration Policy are set out in the Corporate Governance Report. The Remuneration Policy is available on the Companys website at https://www.coromandel. biz/investors/policies/55

vi. E valuation of the Boards performance, its Committees and Directors

I n accordance with the provisions of Section 134 of the

Act and Regulation 17 of the Listing Regulations, the Board has carried out evaluation of its own performance, performance of Committees of the Board, namely, Audit Committee, Corporate Social Responsibility and Sustainability Committee, Risk Management Committee, Stakeholders Relationship Committee, and Nomination and Remuneration Committee, and also the Directors individually. The manner of evaluation of performance and the process adopted for the purpose are explained in the Corporate Governance Report.

vii. A udit Committee

T he Audit Committee comprises of Mr. Sumit

Chairman, Ms. Aruna B. Advani, Member, Mr. K V Parameshwar, Member, Mr. Arun Alagappan, Member and Dr. Deepali Pant Joshi, Member. During the year, six (6) meetings of the Audit Committee were held, the details of which are provided in the Corporate Governance Report. All the recommendations made by the Audit Committee were accepted by the Board.

viii. D irectors Responsibility Statement

A s required pursuant to the provisions of Section

(c) and 134(5) of the Act, the Directors Responsibility Statement is enclosed as Annexure C to this Report and forms part of the Report.

13. K ey Managerial Personnel

P ursuant to the provisions of Section 203 of the Act with the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014, Mr. Arun Alagappan,

Executive Vice Chairman, Mr. Sankarasubramanian S., Executive Director – Nutrient Business, Dr. Raghuram Devarakonda, Executive Director – CPC, Bio and Retail Business, Mrs. Jayashree Satagopan, President

Corporate & Chief Financial Officer and Mr. Rajesh

Mukhija, Sr. Vice President-Legal & Company Secretary are the Key Managerial Personnel of the Company.

14. P olicy on prevention, prohibition and redressal of Sexual Harassment at workplace

T he Company has put in place the Prevention of

Harassment Policy (POSH) in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliance Committee (ICC) has been constituted in compliance with the requirements of said Act to redress complaints received regarding sexual harassment. All employees are covered under this Policy. Employees at all levels are being sensitized about the Policy and the remedies available thereunder.

During the financial year 2022-23, three complaints were received by the ICC and two complaints were disposed off during the year under review, with its recommendations. One complaint was pending investigation as at the end of the year.

15. E mployee Stock Option Plans

E mployee Stock Option Scheme 2007

T he Company had in the past approved the

Stock Option Scheme 2007 (ESOP Scheme 2007), under which employees were granted Options. The

Company made grants under the said Scheme during the period from 2007 to 2011. There were no vested

Options outstanding at the end of the financial year.

There will be no further grants issued under the ESOP Scheme 2007.

E mployee Stock Option Plan 2016

T he Employee Stock Option Plan 2016 (ESOP 2016), as approved by the Shareholders through Postal Ballot on January 11, 2017, was operational during the year. The Board / Nomination and Remuneration Committee has been authorised to issue to the employees such number of Options under ESOP 2016 as would be exercisable into not exceeding 1,45,81,000 fully paid- up equity shares of Re. 1/- each in the Company. Pursuant thereto, the Nomination and Remuneration Committee has formulated detailed terms and conditions of the ESOP 2016. read Further, the Nomination and Remuneration Committee is empowered to determine the eligible subsidiary companies, whether existing or future, whose employees will be entitled to stock options under ESOP 2016. Options granted under ESOP 2016 would vest on or after 1 (one) year from the date of grant but not later than 4 (four) years from the date of grant of such Options or any other terms as decided by the Nomination and Remuneration Committee. The Company has granted

4,13,700 options to the employees during the year under the ESOP 2016. The number of Options vested and outstanding as at the year-end were 14,04,370.

The disclosure required to be made under Regulation 14 of SEBI (Share Based Employee Benefits and Sweat

Equity) Regulations, 2021 is available on the website of the Company at https://www.coromandel.biz/investors/ annual-general-meetings/

E mployee Stock Option Plan 2023

T he Board at its meeting held on March 22, 2023 approved the Employee Stock Option Plan 2023 (ESOP 2023), as per the recommendation made by the Nomination & Remuneration Committee, subject to its approval by the Shareholders of the Company.

The Company is seeking approval of the Shareholders for the ESOP 2023 at the forthcoming Annual General Meeting, which is scheduled to be held on July 27, 2023.

The disclosure required to be made under Regulation

14 of SEBI (Share Based Employee Benefits and Sweat

Equity) Regulations, 2021 is available on the website of the Company at https://www.coromandel.biz/investors/ annual-general-meetings/

16. V igil Mechanism/ Whistle Blower

T he Company has a Whistle Blower Policy which the employees, customers, vendors, and directors an avenue to raise concerns on ethical and moral standards and compliance with legal provisions in conduct of the business operations of the Company. It also provides for necessary safeguards for protection against victimization for whistle blowing in good faith. The Vigil Mechanism is hosted at https://www.coromandel.biz/investors/policies/

17. C orporate Governance

T he Company is committed to maintain the standards of Corporate Governance. As stipulated under the Listing Regulations, the Report on Corporate Governance is appended as Annexure D to this Report.

The requisite certificate from M/s. R Sridharan &

Associates, Company Secretaries confirming compliance with the conditions of Corporate Governance by the Company is also attached to the Report on Corporate Governance.

18. M anagement Discussion & Analysis

T he Management Discussion and Analysis highlighting the industry structure and developments, opportunities and threats, future outlook, risks and concerns, etc., is provided separately in the Annual Report and forms part of this Directors Report.

19. B usiness Responsibility and

Sustainability Report

P ursuant to Regulation 34 of Listing Regulations,

Company has prepared the Business Responsibility and Sustainability Report in line with the business principles as provided in the Business Responsibility Policy adopted by the Company. The Business Responsibility and Sustainability Report is enclosed as Annexure E to this Report and the same is also available on the website of the Company.

20. C orporate Social Responsibility and Sustainability

T he Murugappa group is known for its tradition philanthropy and community service. The groups philosophy is to reach out to the community by establishing service-oriented philanthropic institutions in the field of education and healthcare as the core focus areas. The Company upholds the groups tradition by earmarking a part of its income for carrying out its social responsibilities.

The Company has been carrying out Corporate Social Responsibility and Sustainability (CSRS) activities for many years now even before it was mandated under the Act. The Company has put in place a CSRS policy, which is available on the website of the Company at https:// www.coromandel.biz/sustainability/

As per the provisions of Section 135 the Act and the Rules made thereunder, the Company is required to spend Rs. 33.45 crores for the financial year 2022-23 i.e. 2% of the average net profits of the Company made during the three immediately preceding financial years. The Company, however, spent an amount of Rs. 25.54 crores towards CSR activities during the financial year 2022-23. The unspent amount of Rs. 7.92 crores on the ongoing projects has been transferred in April 2023 to a separate bank account titled Coromandel International Limited - Unspent CSR Account -2022-23 and shall be spent within the time limits specified in the Act and the Rules made thereunder.

Details of the composition of the Corporate Social Responsibility & Sustainability Committee and the CSR Projects undertaken during the year are given in the Annual Report on CSRS Activities, which is appended as Annexure F to this Report.

21. H ealth, Safety, and Environment (HSE)

Y our Company gives high priority to Health, Safety, and Environment (HSE) and has formulated a policy to operate the facilities safely, efficiently and in an environmentally responsible manner. It has put in robust processes and established safety performance indicators the to track its HSE performance. A participative approach is adopted where employees are consistently encouraged to raise safety concerns, and these inputs are periodically monitored and actioned.

During the year, the Total Recordable Incident Rate (TRIR) for the company stands at 0.35 per million manhours.

Taking a major leap towards ESG, the company has voluntarily participated in DJSI Corporate Sustainability Assessment 2022 and obtained score of 50 which is of substantial improvement from previous year. Company has started publishing its Integrated Reports and the first Report was published for the financial year 2021-22.

N utrition Business

Du ring the year, the Total Recordable Incident Rate

(TRIR) for the company stands at 0.41 per million manhours.

T he Company participated in the external survey benchmarking studies on health and safety. As per recent UK-HSL health and safety survey, Coromandel achieved an overall score of 4.25 against the Global benchmarking of 3.48.

The Company has initiated many studies to assess and improve the overall environment, health and safety. Water audit was carried out at Fertilizers plants located at Vizag, Kakinada and Ennore and at Crop Protection Chemical plant located at Ranipet. Fugitive emission study was carried out at Vizag plant.

Under the Asset Integrity program, the Corrosion study was completed at Vizag, Ennore and Kakinada plants. To improve safety culture at the sites, the company through its e-learning platform ‘Vidhya Online introduced safety related digital modules.

All facilities of Fertilizer & Single Super Phosphate

(SSP) business and three facilities (Sarigam, Dahej, and Ankleshwar) of Crop Protection Chemical Plants (CPC) were successfully audited by accredited third party and re-certified for Integrated Management Systems (ISO-45001, ISO 14001 and ISO 9001) during the financial year 2022-23.

The Ennore plant was Certified with ISO: 50001

Certification, which is the energy management certification, during the financial year 2022-23.

To enhance emergency preparedness, projects on fire protection systems upgradation were taken up at fertilizer facilities and fire water systems have been installed and commissioned at SSP plants at Udaipur, Nandesari, Kota and Nimrani.

On environment front, Vizag plant undertook massive plantation under the "Miyawaki Plantation" program and a total of 23000 saplings were planted. Similarly at Kakinada and Ennore, 3000 saplings in the "Miyawaki Plantation methodology were planted. All the plants are operating with Zero Liquid Discharge (ZLD) concept.

During the year, the Company received many accolades for the excellence in Health, Safety and Environment. Five plants of the Company, namely Kakinada. The Companys Vizag plant has achieved the prestigious 5 Star Rating under the British Safety Council 5 Star rating audit during the year 2022-23. (Platinum Award), Ranipet & Kota (Gold Award) and Nimrani & Udaipur (Silver Award) received Kalinga Safety Excellence Award-2022 by Institute of Quality & Environment Management

Services (IQEMS). Vizag plant was adjudged in five star and categories in Kalinga Environmental Excellence Award. Ennore plant bagged silver award and Hospet & Ranipet plants received Bronze award in CII Southern Reason EHS Excellent Award 2022.Vizag plant received 2nd prize for Green Visakha plantation under sustainability report from Public Relations Society of India for the year 2022.

C rop Protection Chemicals Business (CPC)

Du ring the year 2022-23, CPC business has focused on the EHS initiatives and engagement of the employee in the safety culture enhancement. With consistent efforts by making safety as a value, the business has achieved

Total Recordable Injury Rate (TRIR) of 0.24 for the year

2022-23. The Companys CPC plants have achieved zero reportable incident during the year 2022-23. Theme based safety campaigns i.e. Fire Prevention, Confined space entry, Work at Height, Electrical Safety & Material Handling etc were conducted across all CPC units for continuous engagement in the safety excellence journey. The campaign has set safety as a value for business and made everyone demonstrate safety as an integral part of all activities. During the year 2022-23, the plants have received safety accolades. Sarigam plant has won Gold Trophy in QCFI Surat Chapter- One day National Safety Convention for their presentation on "Current Site Safety Management Systems" & Dahej unit has won Gold Trophy in QCFI Vadodara Chapter- One day National Safety Convention for their presentation on "Current Site Safety Management Systems". Various employee engagement and safety awareness i.e. Road Safety Week, National Safety Week, National Fire Service Week, World Environment Day programmes were conducted across CPC plants. The Company has successfully implemented PSM 13 elements with Chola MS Risk Service at Ankleshwar & Dahej plants.

The business commissioned a new 500 KLD Effluent

Treatment Plant (ETP) with MBBR technology commissioned at Dahej Plant. Electronic burner, auto blow down, Air compressor HRU system for preheating of boiler feed water, magnet in gas line were installed in boiler to improve boiler efficiency and reduce specific gas consumption in Dahej Plant. At Ankleshwar plant, 1662 trees were planted as a part of "War on Waste Program".

The Company has changed majority of incineration waste disposal mode to coprocessing with 3R concepts. Overall integrated approach towards Environment, Health & Safety is followed at CPC business and accordingly actions are taken to improve the EHS Key Performance Indicators and make it sustainable business. Overall, the company has adopted an integrated EHS Management system, all the EHS indices are tracked, and proactive actions are taken, and the Company is striving to protect the Health Safety & Environment through environmental friendly plant operations.

22. Other disclosures

i. Sh are Capital

T he paid-up equity share capital of the Company

March 31, 2023 was Rs.29.40 crore. During the year, the Company has allotted 5,17,340 equity shares of Re.1 each under ESOP 2016. No equity shares were allotted under ESOP 2007 during the year.

ii. M aterial Subsidiary Policy

T he Company has adopted a policy for material subsidiary, in line with the requirements of the Listing Regulations and the same is available on the website of the Company at https://www.coromandel.biz/ investors/policies/

iii. A nnual Return

I n accordance with Section 92(3) read with

134(3)(a) of the Act, the Annual Return as on March

31, 2023, is available on the website of the Company at https://www.coromandel.biz/investors/annual-general-meetings/

iv. C onservation of energy, technology absorption, foreign exchange earnings and outgo.

T he particulars of conservation of energy, absorption, foreign exchange earnings and outgo, as prescribed under sub-section (3)(m) of Section 134 of the Act, read with Companies (Accounts) Rules, 2014, are enclosed as Annexure G to this Report and forms part thereof.

v. P articulars of Employees and Remuneration

T he disclosure with respect to remuneration required under Section 197 of the Act read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as

Annexure H to this report.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, is provided in a separate annexure forming part of this report.

However, the annual report is being sent to the Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection and any Member interested in obtaining a copy of the same may write to the Company Secretary.

vi. P articulars of Loans, Guarantees and Investments

D etails of loans and guarantees given and made under Section 186 of the Act are given in the Notes to the Financial Statements.

vii. P ublic Deposits

T he Company has not accepted any deposits from as on public falling within the ambit of Section 73 of the Act read with Companies (Acceptance of Deposits)

Rules, 2014 and no amount of principal or interest was outstanding as on the Balance Sheet date.

viii. C ompliance of Secretarial Standards

T he Company has complied with the

Secretarial Standards issued by The Institute of Company Secretaries of India and approved by the Central Government.

ix. R eporting of Frauds

T here was no instance of fraud during the year review, which required the Auditors to report to the Audit Committee and / or Board under Section 143(12) of the

Act and the rules made there under.

23. Declaration/Affirmations

Du ring the year under review

• there are no significant material orders passed by the Regulators or Courts which would impact the going concern status of the Company and its future operations.

• there are no applications made or any proceedings pending under the Insolvency and Bankruptcy Code, 2016.

• the Company has not made any onetime settlement with any Bank or Financial Institution as such disclosure or reporting requirements in respect of the as 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 is not required.

24. B anks and financial institutions

Y our Company is prompt in making the of interest and repayment of loans to the financial institutions / banks. Banks and Financial Institutions continue their unstinted support in all aspects and the Board had placed on record its appreciation for the same.

25. Acknowledgement

Y our Directors wish to express their grateful appreciation for the valuable support and co-operation received from bankers, business associates, lenders, financial institutions, shareholders, various departments of the Government of India, as well as the State Governments, the farming community and all our other stakeholders.

The Directors acknowledge and would like to place on record the commitment and dedication on the part of the employees of your Company for their continued efforts in achieving good results.

On behalf of the Board of Directors
Place: Chennai A Vellayan
Date :May 15, 2023 Chairman