Everest Industries Ltd Directors Report.

To

The Members of Everest Industries Limited

Your Directors take great pleasure in presenting Eighty-Seventh (87th) Annual Report of Everest Industries Limited ("Company" or "Everest") together with the Audited Financial Statements for the financial year ended March 31, 2020.

Financial Results

articulars

Financial Year ended

Standalone

Consolidated

31.03.2020 31.03.2019 31.03.2020 31.03.2019
Revenue from Operations & Other Income 1,29,279.82 1,41,059.60 1,29,486.00 1,41,479.37
Profit before Depreciation & Finance Costs 5,218.01 1 1,307.32 5,165.32 11,105.14
Less : Depreciation 2,373.63 2,055.50 2,373.63 2,055.50
: Finance Costs 704.17 761.57 704.17 763.20
Profit before Tax 2,140.21 8,490.25 2,087.52 8,286.44
Tax Expense 735.20 2,069.87 735.20 2,100.69
Profit for the Year 1,405.01 6,420.38 1,352.32 6,185.75
Other comprehensive income for the Year, net of tax (32.10) (35.95) (46.34) (45.26)
Total comprehensive income for the Year, net of tax 1,372.91 6,384.43 1,305.98 6,140.49
Add: Balance in Profit & Loss Account 32,000.16 26,840,21 31,866.77 26,950.76
Minority share - - - -
Profit Available for Appropriation 33,373.07 33,224.64 33,172.75 33,091.25
Appropriations:
General Reserve - - - -
Dividend 1,172.73 1,015.70 1,172.73 1,015.70
Tax on Dividend 241.06 208.78 241.06 208.78
Closing Balance 31,959.28 32,000.16 31,758.96 31,866.77

Dividend

The Board of Directors ("Board") have recommended a dividend of 10%

i.e Rs. 1/- per equity share of Rs. 10/- each for the financial year ended March 31, 2020 subject to the approval of the members. The total outgo on account of dividend including tax on dividend will be Rs. 156.36 lakhs as against Rs. 1,413.79 lakhs for the previous financial year

Performance Review

The Company has achieved a Total Revenue of Rs. 1,293 crores during the financial year 2019-20 ("Year"). The highlights of the Companys performance on standalone basis during the Year are as under:

1. Revenue for the Year at Rs. 1,292.80 crores was lower by 8.4% as compared with Rs. 1,410.60 crores in the previous year Top line in Building Products segment recorded a decrease of 7.3% whereas in the Steel Buildings segment the same recorded a decrease of 10.8%.

2. Production volume in the two business segments were as follows:

a. In Building Products segment the production for the Year at 7,59,276 MT was lower by 11.88% over 8,61,650 MT in the previous year

b. In Steel Buildings segment the production for the Year at 46,486 MT during the year was lower by 11.18% over 52,338 MT in the previous year

3. Operating Profit (EBIDTA) d s

lower by 53.85% over Rs. 113.07 crores in the previous year

4. Profit before Tax during the Year at Rs. 21.4 crores was lower by 74.79% as compared to Rs. 84.90 crores in the previous year

5. Cash profit was Rs. 40.94 crores as compared to Rs. 85.26 crores in the previous year

The consolidated revenue of the Company for the Year was Rs. 1,294.86 crores lower by 8.48% from Rs. 1,414.79 crores in the previous year The consolidated operating profit for the Year was Rs. 51.65 crores as compared to Rs. 111.05 crores in the previous year Consolidated Profit after Tax for the Year was Rs. 13.52 crores as against Rs. 61.86 crores in the previous year

COVID-19

Financial year 2019-20 was one of the most challenging years for the Indian economy, which faced several headwinds from a slowdown in domestic and global growth, and geopolitical uncertainties. This was exacerbated by the outbreak of the Coronavirus disease ("COVID-19") pandemic in the second part of the fourth quarter Faced with a crisis with no parallels in recent history, most governments across the world including in India prioritised life over anything else and imposed a lockdown to break the chain of transmission.

The human impact of the virus and the containment efforts have resulted in supply and demand disruptions, resulting in a sharper growth deceleration. The situation remains volatile with the trajectory of the virus undetermined, evolving hot spot geographies, the success of containment measures uncertain, the severity and duration of resulting economic crisis and the extent of structural damage unknown. There are many unknowns today and hence, the near-term outlook is extremely uncertain. Our focus remains on safety of our people, protecting supply lines, serving demand, contributing to the society and optimising cost and cash.

The Companys focus on liquidity, supported by a strong balance sheet and acceleration in cost optimization initiatives, would help in navigating any near-term challenges in the demand environment. Accordingly, at present the management does not see any medium to long term risks in the Companys ability to continue as a going concern and meeting its liabilities as and when they fall due.

Transfer to Reserves

The Company proposes to retain the entire amount of profits in the Profit and Loss account.

Share Capital

During the Year under review, there was no change in the Share Capital of the Company. The Share Capital of the Company as on March 31, 2020 was Rs. 15,63,63,400/- divided into 1,56,36,340 equity

shares of Rs. 10/- each.

Directors Responsibility Statement

Your Directors state that:

a) in the preparation of the annual accounts for the financial year ended March 31, 2020, the applicable accounting standards have been followed and there are no material departures from the same;

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 as at March 31, 2020 and of the profit of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

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

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

Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013 ("Act"), Mr Y. Srinivasa Rao, Director of the Company, retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The Board of Directors recommends his re-appointment as Director of the Company.

The Board, on the recommendation of Nomination & Remuneration Committee ("NRC") and in accordance with provisions of the Act and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), has appointed Mr Anant Talaulicar as an Additional Independent Director, for a period of five (5) years on November 21, 2019, subject to the approval of members at the forthcoming 87th Annual General Meeting ("AGM") of the Company.

He shall hold office as an Additional Director upto the date of the AGM. Mr Talaulicar is eligible for appointment as an Independent Director The Board is of the opinion that Mr Talaulicar possesses requisite qualification, experience, expertise and holds high standards of integrity. The resolution pertaining to appointment of Mr. Anant Talaulicar as an Independent Director is set out in Item no. 4 of the Notice of the AGM.

The Board in its meeting held on March 24, 2020 has re-appointed Mr Y Srinivasa Rao, Whole Time Director designated as Executive Director of the Company for a further period of two years w.e.f. April 23, 2020 to April 22, 2022 subject to the approval of the members of the Company. The resolution pertaining to his re-appointment & the remuneration payable to him is set out at item no. 5 of the Notice of the AGM.

During the Year, members of the Company in the 86th Annual General Meeting have fixed the remuneration to be paid to Mr Manish Sanghi, Managing Director of the Company for the remaining period of his current term as Managing Director of the Company by passing a Special Resolution.

During the Year, members of the Company in the 86th Annual General Meeting have re-appointed Mr M. L. Gupta as an Independent Director for a second term of five (5) years on the Board of the Company with effect from October 1, 2019 upto September 30, 2024.

At the time of fixation of remuneration of Mr Manish Sanghi, Managing Director and Mr Y. Srinivasa Rao, Executive Director, the Company had adequate profits and the remuneration paid / payable to Mr Sanghi and Mr Rao was well within the limits prescribed under section 197 of the Act. However, during the Year, the Company had inadequate profits for payment of remuneration to Managing Director and Executive Director As a result, the remuneration paid to Mr Sanghi and Mr Rao for the Year has exceeded the limits specified under Section 197 of the Act read with Schedule V thereto. Pursuant to Section 197(10) of the Act, the members of the Company can waive the recovery of excess remuneration by passing a special resolution. The Special Resolutions for approval of the members for waiver of recovery of excess managerial remuneration paid by the Company to Mr Sanghi and Mr Rao are set out at Item No. 6 & 7 of the Notice of the AGM respectively.

In view of COVID-19 pandemic, it is likely that the Company may have inadequate profits in coming years to pay managerial remuneration to its executive directors. Therefore, Special Resolution for approval of the members for payment of remuneration to Mr Manish Sanghi, Managing Director of the Company for the period April 01, 2020 to September 30, 2021 is set out at Item No. 8 of the Notice of AGM.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under the Act and Listing Regulations. All the Independent Directors of the Company have registered themselves in the data bank maintained with the Indian Institute of Corporate Affairs.

Board Evaluation

Pursuant to the provisions of the Act and Listing Regulations, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Board Committees. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, leadership attribute of directors through vision and values, strategic thinking and decision making, adequacy of business strategy, etc.

The performance evaluation of the Independent Directors was done by the entire Board excluding the Directors being evaluated. The performance evaluation of the Board as a whole and the NonIndependent Directors was carried out by the Independent Directors.

The Board of Directors expressed their satisfaction with the evaluation process.

Holding, Subsidiaries, Associate & Joint Venture Companies

During the Year under review, Falak Investment Private Limited, promoter of the Company, has become holding company of the Company w.e.f. March 23, 2020.

The Company has a subsidiary in India viz. Everest Building Solutions Limited. This company is engaged mainly in rendering of erection and other related services to its customers. The subsidiary had a total income of f 40.15 Lakhs and incurred a Loss of f 32.01 lakhs during Year

During the Year, the Board has approved the scheme of merger of Everest Building Solutions Limited (wholly owned subsidiary) with the Company under section 230-232 of the Act in the Board meeting held on May 1, 2019. A joint application under section 230-232 of the Act was made before the Honble National Company Law Tribunal, Mumbai Bench ("NCLT"). The Honble NCLT vide its order dated December 13, 2019 had dispensed with the requirement of holding meeting of shareholders and secured creditors of the Company and directed that a meeting of those unsecured creditors of the Company who have outstanding amount of f 2 Lakhs or more be held for the purpose of approving the scheme of Merger Unsecured creditors of the Company approved the aforesaid scheme of merger in their meeting held on February 20, 2020. A joint Petition under Section 230232 of the Companies Act, 2013 was made before the Honble NCLT for obtaining sanction to the aforesaid scheme of merger and the same was admitted on March 12, 2020. The Honble NCLT, vide its order dated March 12, 2020, had fixed April 9, 2020 as date for hearing of the aforesaid Petition. However, hearing did not take place because of nationwide lockdown due to COVID-19 pandemic.

The Company has a subsidiary in Mauritius viz. Everest Building Products. This company operates as a holding company for its subsidiary in the UAE. During the Year, the subsidiary earned an interest income of f 0.02 lakhs and a net loss of f 25.38 lakhs mainly arising on account of impairment of investment.

The Mauritius subsidiary has a subsidiary, Everestind FZE incorporated in UAE. Everestind FZE is a legal entity involved in the trading of Companys products in the Middle East and foreign markets. During the Year, entity earned a total income of f 2,456.83 lakhs and a net loss of f 47.22 lakhs out of trading of Companys products.

In terms of proviso to sub-section (3) of Section 129 of the Act, the salient features of the financial statement of the subsidiaries is set out in the prescribed Form AOC-1, which forms part of the Boards Report as ANNEXURE-1. During the Year, no entity has become or ceased to be a subsidiary or Joint Venture or Associate of the Company.

Deposits

The Company has not accepted any deposits from the public during the Year and, as such, no amount on account of principal or interest on public deposits was outstanding as on March 31, 2020.

Corporate Governance

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by Securities and Exchange Board of India ("SEBI"). A separate Report on Corporate Governance along with a certificate from M/s TVA & Co. LLP, Company Secretaries on compliance with the conditions of Corporate Governance as stipulated under Listing Regulations is provided as part of this Annual Report.

Contracts and Arrangements with Related Parties

During the Year, the Company has not entered into any contract/ arrangement with a related party as specified under section 188 of the Act. Therefore, disclosure in Form AOC-2 is not required. The Policy on materiality of related party transactions and dealing with related party transactions is available on the Companys website at the link www.everestind.com/uploads/Files/161invuf Related-Party.pdf.

Corporate Social Responsibility

In accordance with the requirements of Section 135 of Act, the Company has constituted a Corporate Social Responsibility (CSR) Committee. The composition and terms of reference of the CSR Committee are provided in the Corporate Governance Report.

The CSR Committee has formulated and recommended to the Board, a CSR Policy indicating the activities to be undertaken by the Company, which has been approved by the Board. The CSR Policy may be accessed on the Companys website at the link www.everestind. com/uploads/Files/194invuf CSR-Policy Final.pdf. The Company has identified five focus areas of engagement which are as under:

• Capacity building, skill development, training and employment generation.

• Promotion of education, art, culture and sports.

• Preventive health care and sanitation

• Environmental sustainability

• Eradicating hunger & poverty

The Company also undertakes other need-based initiatives in compliance with Schedule VII to the Act. During the Year, the Company has spent f 117.6 Lakhs on CSR activities as compared to the statutory requirement of f 118.76 Lakhs. Nationwide lockdown announced by the Government of India from March 25, 2020 necessitated immediate suspension of all the CSR Projects and consequently, the Company could not spend remaining amount of f 1.16 Lakhs. Annual Report on CSR activities for the financial year 2019-20 in the prescribed format is annexed as ANNEXURE-2 to this Boards Report. The Company is undertaking the CSR activities through its trust "Everest Foundation".

Business Responsibility Report

Business Responsibility Report for the Year under review, as stipulated under regulation 34 of Listing Regulations in the prescribed format is annexed as ANNEXURE-3 to this Boards Report.

Employees Stock Option Scheme

The Nomination and Remuneration Committee of the Board of the Company, inter-alia, administers and monitors the Employees Stock Option Schemes of the Company in accordance with the applicable SEBI Regulations.

The applicable disclosures as stipulated under the SEBI (Share Based Employee Benefits) Regulations, 2014 as on March 31, 2020 with regard to the Employees Stock Option Schemes (ESOS) is annexed as ANNEXURE-4 to this Boards Report.

The Company has received certificates from the Statutory Auditors of the Company that the Schemes have been implemented in accordance with the applicable SEBI Regulations and as per the special resolutions passed by the members in the Annual General Meetings. The aforesaid certificates shall be available for electronic inspection by the members during the 87th Annual General Meeting.

Statutory Auditors

M/s S.R. Batliboi & Co. LLP, Chartered Accountants has been appointed as Statutory Auditors of the Company in the 83rd Annual General Meeting for a period of five (5) years subject to ratification

by the members at every annual general meeting. Pursuant to the amendment to section 139 of the Act effective from May 7, 2018, ratification by members every year for the appointment of the Statutory Auditors is no longer required and accordingly the Notice of forthcoming 87th Annual General Meeting does not include the proposal for seeking members approval for ratification of Statutory Auditors appointment.

Auditors Report

There are no qualifications, reservations or adverse remarks made by M/s S.R. Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, in their report for the financial year ended March 31, 2020. The Statutory Auditors have not reported any incident of fraud to the Audit Committee or to the Board under section 143(12) of the Act during the Year under review.

Cost Auditors

The Company is required to maintain the cost records as specified by the Central Government under section 148(1) of the Act and accordingly such accounts and records are made and maintained. As per the requirement of Central Government and pursuant to Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, the Company has been carrying out audit of its cost records.

The Board on the recommendation of Audit Committee has appointed M/s Chandra Wadhwa & Co., Cost Accountants as Cost Auditors to audit the cost records of the Company for the financial year 2020-21. As required under the Act, a resolution seeking approval of the members for the remuneration payable to the Cost Auditors forms part of the Notice convening the forthcoming 87th Annual General Meeting.

Secretarial Auditor and Secretarial Standards

The Board has appointed M/s TVA & Co. LLP, Company Secretaries to conduct the Secretarial Audit of the Company for the financial year 2019-20 as required under Section 204 of the Act and the rules made thereunder The Secretarial Audit Report for the financial year 2019-20 is attached as ANNEXURE-5 to the Boards Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

During the Year, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

Disclosures Audit Committee

The Audit Committee of the Board as on March 31, 2020 comprises of Mr Rajendra Chitale (Chairman), Mr B. L. Taparia (Member), Mr M. L. Gupta (Member), Mrs. Bhavna Doshi (Member), Ms. Padmini Somani (Member) and Mr Anant Talaulicar (Member). Mr Rajendra Chitale has been appointed as chairman of the Audit Committee w.e.f. May 3, 2019. Ms. Padmini Somani and Mr Anant Talaulicar have been appointed as members of the Audit Committee w.e.f. July 24, 2019 and December 6, 2019 respectively. For details, please refer to Corporate Governance Report attached to the Annual Report. The Board has accepted all the recommendations made by the Audit Committee.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee of the Board, as on March 31, 2020, comprises of Mr B. L. Taparia (Chairman), Mr. M. L. Gupta (Member), Mrs. Bhavna Doshi (Member), Ms. Padmini Somani (Member) and Mr Anant Talaulicar (Member). Mr B. L.Taparia has been appointed as Chairman of the Nomination and Remuneration Committee w.e.f October 24, 2019. Ms. Padmini Somani and Mr. Anant

Talaulicar have been appointed as Members of the Nomination and Remuneration Committee w.e.f. April 10, 2019 and December 6, 2019 respectively. For details, please refer to Corporate Governance Report attached to this Annual Report.

The Nomination and Remuneration Committee has framed the Nomination, Remuneration and Board Diversity Policy. Nomination,

Remuneration and Board Diversity Policy is available on the website of the Company at www.everestind.com/uploads/Files/342invuf Nomination-BoardDiversitvPolicv.pdf.

Corporate Social Responsibility Committee

The CSR Committee of the Board, as on March 31, 2020, comprises of Ms. Padmini Somani (Chairperson), Mr M. L. Gupta (Member), Mr Alok Nanda (Member), Mr Manish Sanghi (Member) and Mr Y Srinivasa Rao (Member). For details, please refer to Corporate Governance Report which forms part of this Annual Report.

Stakeholders Relationship Committee

The Stakeholders Relationship Committee of the Board, as on March 31, 2020, comprises of Mr M. L. Gupta (Chairman), Mr Manish Sanghi (Member) and Mr Y Srinivasa Rao (Member). For details, please refer to Corporate Governance Report which forms part of this Annual Report.

Vigil Mechanism Policy

Pursuant to Section 177 of the Act read with rules made thereunder and the Listing Regulations, the Company has in place a mechanism for Directors, employees, vendors, customers and other stakeholders to report concerns about unethical behaviour, actual or suspected fraud, violation of Code of Conduct of the Company etc. The mechanism also provides for adequate safeguards against victimization of Whistle Blower who avail the mechanism and also provides for direct access to the Chairman of the Audit Committee. A dedicated helpline managed by an independent professional organisation has been set up by the Company for the Whistle Blowers to report concerns about unethical behaviour, actual or suspected fraud, violation of Code of Conduct etc.

The Vigil Mechanism Policy may be accessed on the Companys website at the link www.everestind.com/uploads/Files/163invuf VigilMechanisimPolicy.pdf.

Risk Management

The Company has Risk Management Policy to mitigate the risks. The Company manages and monitors the principal risks and uncertainties that can impact its ability to achieve its strategic objectives. The Internal Auditor of the Company prepares quarterly risk analysis reports which are reviewed and discussed in the Audit Committee Meetings.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. During the Year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

Number of Meetings of the Board

The Board met six (6) times during the Year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed under the Act and Listing Regulations.

Particulars of Loans, Guarantees or Investments by the Company

The details of investments covered under the provisions of Section 186 of the Act are disclosed in the Note No. 2.05 to the Standalone Financial

Statements. The Company has neither given any loans nor provided any security or fresh guarantee under Section 186 of the Act during the Year

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

The required particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, are attached as ANNEXURE-6 to the Boards Report.

Extract of Annual Return

As per the requirements of Section 92(3) of the Act and rules framed thereunder, the Extract of the Annual Return for financial year 2019-20 is given in ANNEXURE-7 in the prescribed Form No. MGT-9, which is a part of this report. The complete Annual Return is available on the Companys website at www.everestind.com/disclosures-under- statutory-enactments.

Particulars of Employees and Related Disclosures

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of the top ten employees in terms of remuneration drawn as set out in the said rules are provided in ANNEXURE-8 to the Boards Report.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in ANNEXURE-9 to the Boards Report.

General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the Year under review:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

3. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

4. No significant or material orders were passed by the Regulators, Courts or Tribunals which impact the going concern status of the Company and its future operations.

5. No material changes and commitments affecting the financial position of the Company have occurred from the end of the last financial year till the date of this report.

6. No change in the nature of the business of the Company happened during the Year under review.

Your Directors further state that during the Year under review, the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Human Resources

The Company has continuously adopted structures that help to attract best external talent and promote internal talent to higher roles and responsibilities. Everests people-centric focus providing an open work environment, fostering continuous improvement and development helped several employees realize their career aspiration during the Year

Industrial Relations

During the Year, the industrial relations at all the works of the Company were cordial.

Acknowledgement

Your Directors wish to place on record their gratitude to the Companys business associates, trade partners, dealers, customers, shareholders, vendors, bankers, technology providers and other stakeholders all over India and overseas for the continued support and co-operation extended by them to the Company during the Year Your Board also thanks the Government of India, State Governments and other Government Authorities for their continued support and encouragement to the Company and look forward to their support in future.

Your Directors especially wish to place on record their sincere appreciation of the efficient services rendered by the Companys motivated team members from all Zones, Works and Offices.

For and on behalf of the Board

Manish Sanghi Y. Srinivasa Rao
Managing Director Executive Director

Noida, May 29, 2020