disa india ltd share price Directors report

The Board of Directors has the pleasure in presenting the 38th Annual Report and Audited Financial Statements for the Financial Year ended March 31, 2023, together with the Independent Auditors Report.

FINANCIAL RESULTS

Your Company has achieved the highest Revenue from Operations of Rs. 2,524.1 Million for the year 2022-23 with an increase of 1.9 % over previous year 2021-22 despite the market slowdown, recessionary trend, heightened inflation, geographical uncertainty and the factory consolidation activities carried out during the year. Profit After Tax for the year however, decreased by 24.1% to Rs. 284.2 Million from the previous year due to one-time expenditure incurred on factory consolidation and relocation activities, rise in input costs due to high inflation prevailing in the economy and increase in various other cost. The year was marked as a year of consolidation.

Summarized financial results for the year are given below.

		(Rs. Million)
Description	2022-23	2021-22
Revenue from Operations(net)	2,524.1	2,476.7
Profit before depreciation, tax & finance cost	433.8	544.5
Less: Depreciation	43.1	33.4
Less: Finance Cost	6.3	7.8
Less: Tax Expenses (including deferred tax)	100.2	128.9
Profit After Tax	284.2	374.4
Add: Other Comprehensive income	(3.3)	1.0
Total Comprehensive income for the year, net of tax	280.9	375.4
Add: Balance in Profit & Loss account brought forward from previous year	1,987.1	1,844.3
Profit Available for Appropriation	2,268.0	2,219.7
Appropriation:
Interim Dividend declared for the year	145.4	218.1
Final Dividend (proposed)	14.5	14.5
Balance in Profit & Loss Account	2,108.1	1,987.1
Earnings Per Share (Rs)	195.43	257.46
Market price per share as on March 31 (Rs)	7,926.9	6,240.0

PERFORMANCE OF THE Company

The best ever revenue from operations for the Financial Year 2022-23 of Rs 2,524.1 Million was achieved driven by a strong order backlog at the beginning of the year, increased exports and exploring new markets. This excellent milestone was achieved in a very uncertain environment, continued operational challenges, delays in supply chain and the expansion work carried out in Tumkur manufacturing facility to build the factory of the future. The Companys focus during the year continued to overcome supply chain delays, contain inflationary pressures, control discretionary expenses and conservation of cash. The Company has expanded its sales and market activities in overseas market in Middle east, Africa and CIS countries.

The Company was able to mitigate the impact of rises in input materials and increase in logistics costs to some extent through increases in selling price, advanced buying strategy and increases in aftermarket parts revenue.

The employees of the Company have shown exemplary commitment to overcome the economic uncertainties and business challenges prevailing in the economies.

The ups and downs in the automotive sector during the year with challenging numbers on cars, two wheelers and HCV segments led to deceleration of growth seen in the last fiscal. However, the infrastructure industries showed a progressive trend in segments like Railways, Renewable Energy, Steel, Cement, Airports, Ports and Exports. Broadly, the industrial segment even now is better poised for growth than the automotive segment.

In this scenario, the Company has maintained its market share in key businesses.

CHANGE IN THE NATURE OF BUSINESS

There has been no change in the nature of business of the Company during the Financial Year.

DIVIDEND

Considering the dividend track record of the Company and based on the Companys performance during the current Year 2022-23, the Board of Directors had declared an Interim Dividend of Rs 100/- per Equity Share (1000%) totaling to Rs.145.42 Million, which was paid on March 8, 2023. Consistent with the past years, the Directors have recommended a Final Dividend of Rs. 10/- per Equity Share of Rs. 10/- each (i.e., 100%), amounting to Rs. 14.5 Million, subject to approval by the shareholders. Total of the interim and final dividends paid /to be paid by the Company, if the final dividend is approved by the shareholders, works out to Rs. 159.92 Million at 56.27% of payout from the profit after tax for the year.

As provided in the Finance Act 2020, from the Financial Year 2020-21 and onwards dividend is being taxed in the hands of recipients. Information about taxation of dividend is included in AGM Notice.

In terms of Regulation 43A of SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 ("the Listing Regulations"), the Dividend Distribution Policy duly approved by the Board is available on the website of the Company at https://www.disagroup.com/en- in/investor-relations/disa-india-ltd/policies

RESERVE

The Company has not proposed to transfer any amount to the general reserve.

SHARE CAPITAL

The Authorized Equity Share Capital of your Company is Rs. 50 Million. The Issued, Subscribed and Paid-up Equity Share Capital of your Company as on March 31, 2023 stood at Rs. 14.5 Million.

During the year under review, your Company has not issued any shares with differential voting rights nor granted Stock Options or Sweat Equity. The Company has also not bought back any of its shares during the year under review. As on March 31, 2023, no Directors held shares or convertible instruments of the Company except the Managing Director who held 1 (one) Equity Share of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT ECONOMIC SCENARIO AND OUTLOOK

The global situation arising out of the continuing war in Ukraine, recession in the western economies, extreme volatility in major foreign currencies has compounded the uncertainties when we enter into the new financial year. Your Company is not immune to any of these situations even though, our Company does not have a direct business exposure to the war zone and not impacted by restrictions on both Russia and Belarus. The Company will continue to watch these developments and their impact on its business quite rigorously.

Several rounds of increase in interest rates have impacted the pace of growth of the capital goods sector and have delayed the capital expenditure cycle. There is underutilization of existing capacities and liquidity continues to be an issue. However, the Company has an inherent ability to take suitable measures to tide over these environments and respond to the ever-changing external developments from time to time. The Company has been in constant pursuit of exploring into new geographies, new applications of its products and newer revenue streams including its Norican digital initiatives to overcome such challenges in the long term.

INDUSTRY OUTLOOK AND OPPORTUNITIES

The outlook for the foundry industry remains stable as it plays a significant role in the manufacturing sector and contributes to various industries such as automotive, agriculture, infrastructure, railways & general engineering. The growth of Foundry industry reflects on the domestic & global economic conditions. India produces approximately 12.5 million ton of castings per annum and is positioned as a second highest producer in the world after China followed by US in the 3rd position. In the last few years cast production has witnessed an average growth rate of 4-5% in India.

The casting production growth rate indicates growth in automotive, infrastructure and export markets which mainly fuel the demand in the industry. Automotive is one of the major casting consumers and it has expanded capacities. Similarly, the infrastructure spendings by the govt on smart cities, national infrastructure pipeline leads demand in castings like manhole covers, pipe fittings, pumps, valves, etc. India has an inherent advantage in the export markets due to cost and quality competitiveness. The alternate production location as a part of China+1 policy also has added to the growth opportunity in the foundry industry in India. Today, the Indian foundry industry serve the global markets and major companies across US, Europe and South America. This has created the demand for building new capacities in the foundry industry.

Foundry industry in India is investing across segments to build in new technology, upgrade the existing set ups and playing big at a global level. This has been witnessed across existing foundries and new investors venturing into the field, which is an encouraging sign for the industry.

The foundry industry is witnessing advancements in technologies such as digital, robotics and automation, which can improve productivity, reduce costs and enhance quality. Adoption of these technologies can further strengthen the Indian foundry sector and enable it to compete on a global scale. There is a growing focus on environmental sustainability and compliance with emission norms in the foundry sector. Foundries are adopting cleaner technologies and implementing measures to reduce energy consumption, minimize waste generation and control pollution.

Like any other industry the foundry industry also faces some challenges. These include access to finance, high interest rates, the need for continuous innovation and upgradation, availability of skilled manpower and compliance with international quality standards and regulations. However, with the right support and strategic initiatives, the outlook for the foundry industry in India remains favorable.

Your Company is a major shareholder in these growth opportunities due to its unique technological advantage, strong project management capabilities, digital and clear air solutions, which has been built over a period of 4 decades in India.

Your Company is a preferred supplier in the foundry industry and has had more than half of the industry share for many years. Our approach to the market is to present the "FULL FOUNDRY" offer with a consultative approach to the customers. The unique digital solutions from Norican such as Monetizer Discover & Monetizer Prescribe is sooner getting acceptance with major players in the industry. Your Company has built the capability to deploy the most modern foundry in the industry.

DISA India has always been the first mover in the industry with customer first approach and started initiatives like uptime increase service contracts, set up the distributors closer to the customer locations to service the parts requirements and partnered on digital solutions. We continue to strive for better in future as well.

The GDP estimates for the Financial Year 2023-24 is less than 6%, though India is still seen as the highest growing market in the world. The government spending on infrastructure continue to run full stream. Divestment initiatives have been implemented to generate funds to use for the infrastructure development programs. This would help your Company to work for new applications across segments like Steel, Construction and Energy. Your Company is also looking to support companies doing exports for establishing right quality for their end products. Your Company also sees many export opportunities to the Middle East, Turkey, Brazil and a few SubSaharan nations seeking to industrialize their economies.

Although there are no visible signs of the 4th wave, the things could change quickly, which may have a negative impact on the overall business environment like the last few waves.

The Index of Industrial Production (IIP) and Purchasing Managers Index (PMI) have historically been good indicators for business sentiments in capital goods order intake. Movements in IIP and PMI have been explained in the following charts.

MARKET DEVELOPMENT

Your Company has recovered well from the hugely uncertain environment impacted by the Pandemic. But the threat of uncertainties, unfolded by the current geopolitical issues, has hindered the market.

The Companys full foundry solution is more visible not only in India but also in Middle East, where your Company is building a new foundry at Doha, Qatar with a new customer. The Company has also exported a few machines to Turkish market with the help of group Company in Denmark.

Norican digital offer to the market has been evaluated and the same is also getting implemented in some of the flagship foundries in India, creating a stronger partnership beyond equipment sales.

The Aftermarket distribution business has now 6 distributors across 9 warehouse locations across all parts of the country near the key installation base - Ludhiana, Manesar, Kolhapur, Pune, Jamshedpur, Coimbatore, Ahmedabad, Rajkot and Bangalore. The Company has also waged a war against the pirate parts sellers, by conducting performance trials and proving reduction on overall cost of operations for the end users.

Your Company has embarked upon the journey of SBTi (Science Based Targets initiative) by signing the pledge along with the Parent, Norican Group to reduce carbon footprint. There is an immense focus on the implementation of this initiative and to find out areas of impact to start the process.

KEY RATIOS

As required by the Listing Regulations, the Company is required to furnish the details of significant changes (i.e., change of 25% or more as compared to the immediate previous Financial Year) in key financial ratios, along with detailed explanations for the changes.

The Company has identified the following ratios as Key financial ratios:

Particulars	Standalone			Consolidated
	2022-23	2021-22	Change %	2022-23	2021-22	Change %
Operation Profit Margin (EBITA) %	11.3%	16.5%	(31.5%)	11.6%	16.6%	(30.1%)
Net Profit Margin %	11.3%	15.1%	(25.1%)	11.4%	15.1%	(24.5%)
Debtor Turnover Ratio	6.5	9.3	(30.1%)	6.4	9.0	(28.9%)
Inventory Turnover Ratio	4.9	6.2	(21.0%)	5.0	6.3	(20.6%)
Interest Coverage Ratio	62.0	65.5	(5.3%)	64.9	67.5	(3.9%)
Current Ratio	2.2	24	(8.3%)	2.2	2.3	(4.3%)
Debt Equity Ratio	0.01	0.02	50%	0.01	0.02	50%
Earnings Per Share (Rs)	195.4	257 5	(24.1%)	204.7	265.4	(22.9%)

During the year, there were unfavorable changes in the above ratios. The decrease in profit margin, was due to expenditure incurred on factory expansion, consolidation & relocation activities, rise in input cost and various other costs, due to high inflation.

Debtors turnover was impacted due to increase in Debtors at the year end on export sales received subsequently. Decrease in inventory turnover ratio is due to increase in average inventory due to higher order backlog.

The details of return on net worth at standalone and consolidated levels are given below:

Particulars	Standalone			Consolidated
	2022-23	2021-22	Change %	2022-23	2021-22	Change %
Return on Net Worth %	13.4%	18.6%	(28.0%)	13.7%	18.7%	(26.7%)

Return on net worth is computed by dividing the net profit by year end net worth. Decrease in Net profit during the year has decreased the return on net worth.

CORPORATE SOCIAL RESPONSIBILITY

Your Company is committed to comply with Corporate Social Responsibility (CSR) as a good corporate citizen. The Directors are pleased to report that your Company is pursuing its efforts to support the community circles in which it operates. The Companys

CSR program titled "NORICAN Scholarship" has helped in providing financial assistance to less privileged students up to standard twelve as well to students seeking diplomas in Engineering.

"NORICAN Scholarship" program has made scholarships available to students in eight educational institutions in the neighborhood of your Companys plants situated at Tumkur and Hosakote in Bengaluru. During the Financial Year, scholarships were provided to 513 needy students. Directors have the pleasure to report that your

Company has provided scholarships to 3311 students since inception. In addition, your Company has invested in infrastructure development for the schools to provide drinking water, teaching aids and sanitation. Your Company has also extended scholarships to 50 meritorious Engineering students through an NGO Foundation for Excellence India Trust and since inception 492 students have been given the scholarships.

The Company has partnered with National Institute of Advanced Manufacturing Technology (NIAMT) [Formerly National Institute of

Foundry and Forge Technology (NIFFT)], Ranchi and put in place a scholarship in the name of "Jan Johansen DISAMATIC Scholarship" to provide scholarship to 5 top meritorious students every year to create Industry Academia interface to create future foundry men. During the year, the Company has spent Rs. 0.4 Million towards this scholarship.

The Company has during the year partnered with the Thats Eco Foundation (Registered Trust), Bangalore for plantation of 1000 saplings during the year. Focus is on forest and sustainable greening using the options such as wetland, Miyawaki forest (technique pioneered by Japanese botanist Akira Miyawaki, which helps in growing dense, native forests), traditional forest, grassland ecology for plantation.

The Companys policy on Corporate Social Responsibility and CSR projects pursued by the Company are available on the website of the Company at https://www.disagroup.com/gn-in/investor-rglations/ disa-india-ltd/policies

The Composition of CSR Committee, details of the amounts spent during the current Financial Year and the manner in which it was spent are provided in Annexure - A.

RISK MANAGEMENT

The Company has constituted a Risk Management Committee comprising three Directors, Managing Director and the Chief Financial Officer. The Committee met two times during the year. This Committee shoulders the responsibility of monitoring and reviewing the risk management plan and periodical review of the Risk Management Policy and appraise the Board about risk assessment and mitigation procedure. It also undertakes to ensure that Executive Management controls risks by means of properly designed risk management framework.

All the insurable assets of the Company are deemed to have been adequately insured.

Risk Management Policy is hosted on the Companys website at https://www.disagroup.com/gn-in/invgstor-rglations/disa-india-ltd/ policies

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has formulated a Whistle Blower Policy for vigil mechanism which is available in the website of the Company at https://www.disagroup.com/gn-in/invgstor-rglations/disa-india-ltd/ policies. Complaints raised, if any, are dealt with as per this policy. No complaints have been received during the year 2022-23.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

There has been no change in the constitution of Board during the year under review. None of the Directors is disqualified from being appointed as such under the provision of Section 164 of the Companies Act, 2013.

In terms of the provisions of the Companies Act, 2013, and the Articles of Association of the Company, Mr. Anders Wilhjelm, Director, retires at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment.

The Board of Directors at its meeting held on May 25, 2023 on the recommendation of the Nomination and the Remuneration Committee approved re-appointment of Mr. Lokesh Saxena as Managing Director of the Company for another term of three years from June 21, 2023 to June 20, 2026, as per the terms and conditions and the remuneration as set out in the AGM Notice, subject to the approval of the shareholders.

The Independent Directors, Ms. Deepa Hingorani and Mr. Bhagya Chandra Rao have maintained the highest standards of integrity in their dealings with the Company. They also possess the requisite expertise and experience (including Proficiency) necessary for acting as Independent Directors of the Company. Annual Declarations received from both for the year 2022-23 contain affirmations regarding registrations in the data bank.

The Company has three Key Managerial Persons (KMP), Mr. Lokesh Saxena, Managing Director, Mr. Amar Nath Mohanty, Chief Financial officer and Ms. Shrithee M S, Company Secretary & Compliance Officer. Mr. G. Prasanna Bairy, Company Secretary & Compliance Officer resigned from the office at close of business hours on November 11, 2022 and Ms. Shrithee M S has been appointed as the Company Secretary & Compliance Officer on November 22, 2022.

The Remuneration Policy of the Company for appointment and remuneration of the Directors, Key Managerial Personnel and Senior Executives of the Company and other related information have been provided in the Corporate Governance Report which forms part of this report.

Policy on appointment and remuneration of Directors and KMPs is available in the website of the Company at https://www.disagroup. com/gn-in/invgstor-rglations/disa-india-ltd/policigs

INDEPENDENT DIRECTORS

Declarations under Section 149(7) of the Companies Act, 2013 have been received from all the Independent Directors of the Company confirming that they meet the criteria of independence as provided in Sub-Section 6 of Section 149 of the said Act and as per the Listing Regulations.

The Board has evaluated the Independent Directors and confirms that Ms. Deepa Hingorani and Mr. Bhagya Chandra Rao have fulfilled the independence criteria as specified in the Listing Regulations and their independence from the management.

Details on terms of appointment of Independent Directors and the familiarization program have been displayed on website of the Company at https://www.disagroup.com/gn-in/invgstor-rglations/ disa-india-ltd/policies

MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year, five (5) Meetings of the Board of Directors were held, as per the Companies Act, 2013 and the Listing Regulations. The details of the Meetings are furnished in the Corporate Governance Report.

The Meetings of the Board are held at regular intervals with a time gap of not more than 120 days between two consecutive Meetings. The Agenda of the Meetings were circulated to Directors in advance.

Minutes of the Meetings of the Board of Directors were circulated amongst the Directors for their perusal.

BOARD EVALUATION

Pursuant to the requirements of the Companies Act, 2013 and the Listing Regulations, the Board of Directors has carried out an annual evaluation of its own performance, its Committees and of individual Directors.

Further, the Independent Directors, at their exclusive Meeting held on January 30, 2023, reviewed the performance of the Board, its Chairman and Non-Independent Directors and other items as stipulated under the Listing Regulations. The Independent Directors have also declared their independence. The Nomination and Remuneration Committee has reviewed the existing criteria for evaluation of performance of the Independent Directors and the Board and reviewed the existing policy of remuneration of Directors.

DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(5) of the Companies Act, 2013, the Board hereby submits its responsibility Statement: -

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

b) the Directors 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 the Financial Year and of the profit and loss of the Company for that year;

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

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

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

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

INTERNAL FINANCIAL CONTROL

Your Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Internal Controls in the Company have been designed to further the interest of all its stakeholders by providing an environment which is facilitative to conduct its operations and to take care of, inter alia, financial and operational risks with emphasis on integrity and ethics as a part of work culture.

The scope and authority of the Internal Audit (IA) is defined every year by the Audit Committee. To maintain its objectivity and independence, the Internal Auditors report to Chairman of the Audit Committee and the Board. The Internal Auditors monitor and evaluate the efficacy and adequacy of internal control system in the Company and its compliance with accounting procedures, financial reporting and policies at all locations of the Company.

Based on the report of internal audit, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Any significant audit observations and corrective actions thereon are presented to the Audit Committee and the Board. No major internal control weakness was identified during the year. The Company also has a well-functioning Whistle Blower Policy in place.

The Board has appointed Protiviti India Member Private Limited to continue as the Internal Auditors of your Company for the Financial Year 2023-24.

DEPOSITS

Your Company has neither accepted nor renewed any Deposits from the public within the meaning of the Companies Act, 2013, and hence, no amount of principal or interest was outstanding on the date of the Balance Sheet and also on the date of this Report.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

Your Company has one Wholly Owned Subsidiary "Bhadra Castalloy Private Limited".

The performance of Subsidiary during the Financial Year 2022-23, being the seventh year of operations, has been quite satisfactory. The Audited Financial Results of the Wholly Owned Subsidiary for the Financial Year ended March 31, 2023, are consolidated with the Financial Results of the Company for the Financial Year. Revenue from operations and Profit after tax of the Subsidiary Company were Rs. 123.3 Million and Rs. 13.5 Million respectively. Revenue from operations for the year was 15.7% higher and Profit after tax was 17.4% higher as compared to previous year.

Consolidated Revenue from Operations of the Company for the year was Rs. 2,619.0 Million as against Rs. 2,560.7 Million in the previous year, with an increase of 2.3%.

A statement relating to Subsidiary Company in Annexure - B in Form AOC-1 is part of this report.

Your Company did not have any Joint Venture or Associate Company at the end of the Financial Year.

RELATED PARTY TRANSACTIONS

All Related Party Transactions which were entered into, during the Financial Year were in the ordinary course of business, on arms length basis and were as per prior omnibus approvals of the Audit Committee; where needed. The Company has obtained post facto approvals of the Audit Committee. There are no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All the Related Party Transactions were placed before the Audit Committee as well as the Board for approval. Prior omnibus approval of the Audit Committee was obtained on an yearly basis for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are reviewed and a statement giving details of all Related Party Transactions is placed before the Audit Committee and the Board of Directors for their noting/approval on quarterly basis. The details of all Related Party Transactions are disclosed in the SI. No. 44 of the Notes forming part of the Financial Statements.

None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

Form for disclosure of particulars of contracts/arrangements entered into by the Company with related parties are given in Annexure - C in Form AOC-2 is part of this report.

The Policy on Related Party Transactions as approved by the Board is uploaded on the Companys website and the details of all the Related Party Transactions are disclosed in the financials. The Policy is available on the website of the Company at https://www.disagroup. com/gn-in/investor-relations/disa-india-ltd/policies

GROUP COMPANIES

Persons constituting Group coming within the definition of "Group" as defined in the Competition Act, 2002 includes the following:

Name of Subsidiary	Country
Norican A/S	Denmark
Norican Global A/S	Denmark
Norican Group ApS	Denmark
Norican Holdings ApS	Denmark
DISA Holding A/S	Denmark
DISA Holding II A/S	Denmark
DISA Industries A/S	Denmark
WGH Holding Corp.	British Virgin Islands
Wheelabrator Group (Canada) ULC	Canada
DISA (Changzhou) Machinery Ltd.	China
Italpresse Industrie (Shanghai) Co. Ltd.	China
Kunshan Italpresse Die-casting Equipment Co., Ltd	China
StrikoWestofen Thermal Equipment (Taicang) Co. Ltd.	China
Matrasur Composites SAS	France
Wheelabrator Group SAS	France
Walther Trowal S.a.r.l	France
Wheelabrator Group GmbH	Germany
Wheelabrator Group Holding GmbH	Germany
Wheelabrator-Berger Stiftung GmbH	Germany
OT Oberflachentechnik Maschinen und Werkzeuge Handels GmbH	Germany
DISA Industrieanlagen GmbH	Germany
Wheelabrator OFT GmbH	Germany
Nolten GmbH	Germany
LMCS Group Holding GmbH	Germany
Light Metal Casting Solutions Group GmbH	Germany
SWO Holding GmbH	Germany
Light Metal Casting Equipment GmbH	Germany
StrikoWestofen GmbH	Germany
DISA Limited	Hong Kong

 

Name of Subsidiary	Country
DISA India Limited	India
DISA Technologies Private Ltd.	India
Bhadra Castalloy Private Limited	India
Italpresse Gauss S.p.A.	Italy
DISA K.K.	Japan
WG Plus de Mexico S de RL de CV	Mexico
WG Plus Servicios S de RL de CV	Mexico
StrikoWestofen de Mexico, S.A. de C.V	Mexico
IP Mexico Die Casting S.A. de C.V.	Mexico
Wheelabrator Schlick Sp. Z.o.o.	Poland
SWO Polska Sp. Z.o.o.	Poland
Wheelabrator Group SLU	Spain
DISA Industrie AG	Switzerland
DISA Holding AG	Switzerland
Blast Cleaning Techniques Ltd	United Kingdom
Castalloy Europe Ltd	United Kingdom
WGH UK Holdings Limited	United Kingdom
WGH UK Ltd.	United Kingdom
Wheelabrator Technologies (UK) Ltd.	United Kingdom
Wheelabrator Group Ltd.	United Kingdom
Abrasive Developments Ltd	United Kingdom
Spencer & Halstead Ltd	United Kingdom
Impact Finishers Ltd. United Kingdom 100% Dormant	United Kingdom
Vacu-Blast International	United Kingdom
DISA Industries Inc.	United States
WG Global LLC	United States
DISA Holding LLC	United States
Wheelabrator Group Inc.	United States
Castalloy Inc	United States
Wheelabrator (Delaware) LLC	United States
Italpresse of America Inc	United States
Schmidt Manufacturing, Inc	United States
Bob Schmidt, Inc	United States
Norican Czech s.r.o.	Czech Republic
Striko Dynarad Corp.	United States
Norican Digital GmbH f/k/a LMCS Tech GmbH	Germany
Simpson Technologies Corporation	United States
Westman Simpson Technologies Private Limited	India
Simpson Technologies GmbH	Germany
Webac S.r.o.	Czech Republic
Striko Westofen Ltd	United Kingdom

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE Company, BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There were no material changes and commitments between the end of the Financial Year and the date of the report, which affects the financial position of the Company.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN, OR SECURITY PROVIDED BY THE Company

Your Company has made an investment of Rs. 44 Million in the Equity Share Capital of its Wholly Owned Subsidiary Company, Bhadra Castalloy Private Limited during the year 2015-16. It has extended interest-bearing interCompany demand loan of Rs. 26 Million in the year 2016-17 in the year for the purpose of financing the purchase considerations paid for acquisition of the foundry by the Subsidiary. Bhadra Castalloy Private Limited repaid to the Company one portion of the loan of Rs. 8.5 Million in the year 2022-23 out of its internal resources. The Company had also given a Corporate Guarantee of Rs. 35 Million to Kotak Mahindra Bank on behalf of its subsidiary for providing banking facilities. The above Investment in equity, loan extended and guarantees given are well within the limits prescribed under the provisions of Section 186 of the Companies Act, 2013.

STATUTORY AUDITORS

Pursuant to provisions of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, the Company, had appointed Messrs. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration Number. 008072S) as the Statutory Auditors of the Company at the 28th Annual General Meeting held on May 16, 2013 and were reappointed at the 33rd Annual General Meeting to hold office from the conclusion of the said meeting till the conclusion of the 38th Annual General Meeting.

Messrs. Deloitte Haskins & Sells LLP will complete their term of ten years at the conclusion of the ensuing 38th Annual General Meeting after completing the second and final term of 5 years up to Financial year 2022-23. Messrs. Deloitte Haskins & Sells would cease to be the statutory auditors of the Company.

Messrs. Deloitte Haskins and Sells, have confirmed that they satisfy the independence criteria as per Companies Act, 2013 and Code of ethics issued by the Institute of Chartered Accountants of India for the year 2022-23.

The Company had initiated actions to appoint new Statutory Auditors of the Company to take effect from the current financial year 202324. The Company has gone through the due process of selection and appointment of the new Statutory Auditors of the Company. It was proposed to appoint Messrs. S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004) as the Statutory Auditors of the Company from the close of the 38th Annual General Meeting to be held on August 10, 2023 subject to the approval of the Shareholders.

Messrs. S.R. Batliboi & Associates LLP, have confirmed that they satisfy the independence criteria as per Companies Act, 2013 and Code of ethics issued by the Institute of Chartered Accountants of India.

The Board of Directors has, based on the recommendation of the Audit Committee and subject to approval of the Shareholders, appointed Messrs. S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004) as Statutory Auditors of the Company for a term of five (5) years from the financial year 2023-24 to 2027-2028 to hold office from the conclusion of the 38th AGM till the conclusion of the 43rd AGM.

Messrs. S.R. Batliboi & Associates LLP have given their consent to act as the Auditors of the Company and have confirmed that their appointment, if made, will be within the limit specified under sections 139 and 141 of the Act. They have also confirmed that they are not disqualified to be appointed as statutory auditors in terms of the provisions of the Section 141 of the Act and the provisions of the Companies (Audit and Auditors) Rules, 2014.

Accordingly, resolution for the appointment of Messrs. S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004) will form part of the notice convening the 38th AGM.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost records maintained by the Company in respect of its activity are required to be audited. Your Board has, in its Meeting held on May 25, 2022, based on the recommendation of the Audit Committee, appointed Messrs. Rao, Murthy & Associates, Bengaluru as Cost Auditors of the Company for the Financial Year ended March 31, 2023.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Vijayakrishna KT, Practising Company Secretary to undertake the Secretarial Audit of the Company for the Financial Year ended March 31, 2023. The Report of the Secretarial Auditor is annexed in Annexure - D.

EXPLANATION BY BOARD ON ADVERSE COMMENTS BY AUDITORS

There were no adverse comments by the Auditors of the Company and hence, no explanations are provided.

REPORTING OF FRAUDS

During the year under review, the Statutory Auditor, Cost Auditor and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee and / or Board under section 143(12) of the Act.

CORPORATE GOVERNANCE

As required under Regulation 34 (3) read with Schedule V (C) of the Listing Regulations, a report on Corporate Governance and the certificate as required under Schedule V (E) of the Listing Regulations from Mr. Vijayakrishna KT, Practising Company Secretary, regarding compliance of conditions of Corporate Governance are given in Annexure - E and Annexure - F respectively, forming part of this report.

As required by the Listing Regulations, Annual Secretarial Compliance Report issued by Mr. Vijayakrishna KT, Practising Company Secretary for the Financial Year ended March 31, 2023 will be filed with BSE within the due date of May 30, 2023.

Further, in compliance with the Listing Regulations, your Board has adhered to the Corporate Governance Code. All the requisite Committees are functioning in line with the guidelines.

As reported earlier, a reputed firm of independent Chartered Accountants has been carrying out the responsibilities of Internal Audit of the Company and periodically reporting their findings on systems, procedures and management practices.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Business Responsibility and Sustainability Report (BRSR) of your Company for the Financial Year ended March 31, 2023 as given in Annexure - G forms part of this Annual Report as required under Regulation 34(2)^) of the Listing Regulations.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/ INDUSTRIAL RELATIONS

Industrial relations have been cordial and constructive, which have helped your Company to achieve production targets. The Companys three-year long-term agreement with the workmen has been renewed with another three-year long-term agreement effective from October 01, 2021 to September 30, 2024.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section i34(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 is attached as Annexure - H which forms part of this Report.

ANNUAL RETURN

Pursuant to Section 92(3) of the Companies Act, 2013 and the Companies (Management and Administration) Rules, 2014, a copy of the annual return is placed on the website of the Company at https:// www.disagroup.com/gn-in/investor-rglations/financial-rgports/ extract-of-annual-return

MATERIAL ORDER PASSED BY ANY COURT OR REGULATOR OR TRIBUNALS IMPACTING GOING CONCERN STATUS OF Company

There were no orders passed by any Court or Regulator or Tribunal during the year under review which impacts the going concern status of the Company.

REMUNERATION POLICY

The Nomination and Remuneration Policy, inter-alia, provides for criteria and qualifications for appointment of Director, Key Managerial Personnel and Senior Management, Board diversity, remuneration to Directors, Key Managerial Personnel, etc. The policy can be accessed at the following link: https://www.disagroup.com/en-in/investor- relations/disa-india-ltd/policies

PARTICULARS OF EMPLOYEES

During the year, there were two employees who received remuneration exceeding Rs. 1,02,00,000/- (Rupees One Crore Two Lakhs Only) per annum and/or Rs. 8,50,000/- (Rupees Eight Lakhs Fifty Thousand Only) per month. The details are as under:

Name of the employee	Designation	Remuneration (Rs. Millions)
Mr. Lokesh Saxena	Managing Director	19.31
Mr. Amar Nath Mohanty	Chief Financial Officer	12.99

There were no employees posted and working in a country outside India, not being Directors or relatives, drawing more than the amount prescribed under the Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Hence, the details are not required to be circulated to the Members and also not required to be attached to this Annual 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 - I forming part of this report. Further, the report and the accounts are being sent to the Members excluding the particulars of top ten employees. In terms of Section 136 of the Act, particulars of top ten employees is open for electronic inspection at the Registered Office of the Company. Any Member interested in obtaining a copy of the same may write to the Company Secretary.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place a Gender-Neutral Policy on Zero Tolerance towards Sexual Harassment at Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.

The following is a summary of sexual harassment complaints received and disposed off during the Financial Year 2022-23.

No of complaints received: Nil.

No of complaints disposed off: Nil.

OTHER DISCLOSURES

a) Your Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India during the year.

b) There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.

c) The Company has not made any one-time settlement for loans taken from the Banks or Financial Institutions.

ACKNOWLEDGEMENT

Your Directors place on record the appreciation for valuable contribution made by employees at all levels, active support and encouragement received from the Government of India, the Government of Karnataka, Companys Bankers, Customers, Principals, Business Associates and other Acquaintances.

Your Directors recognize the continued support extended by all the Shareholders and gratefully acknowledge with a firm belief that the support and trust will continue in the future also.

	For and on behalf of the Board of Directors
Date: May 25, 2023	Deepa Hingorani
Place: Bengaluru	Chairperson
	DIN: 00206310