fineotex chemical ltd Directors report

Dear Members,

Your Board of Directors ("the Board") take pleasure in presenting the Boards Report as a part of the 20th Annual Report of your Company ("the Company" or "FCL"), together with the Audited Financial Statements (Standalone and Consolidated) and the Auditors Report thereon for the financial year ended 31st March 2023.

1. HIGHLIGHTS

The Financial Year 2022-23 has been a yet another milestone year for Fineotex Chemical Limited. We saw the turnover boost over Financial Year2021-22 signifying the increase in our market share. This is the result of persistent policy pursued by the Company to provide customised business solutions to our customers and this has led to an increase in our product basket while simultaneously increasing our market share. This high growth category will result in higher margins. The performance reiterates the essence of our mission and our capabilities to be an effective customized solution provider along with traditional specialty chemicals. The performance reiterates the essence of our mission and our capabilities to be an effective solution provider in addition to a dependable functionary in the customers supply change. These results have now become a benchmark for us, motivating us to actively pursue new opportunities. Moving forward, we remain dedicated to diversifying our customer portfolio and expanding our product range across business segments. Our commitment to growth and innovation drives us to continuously strike excellence in meeting the evolving needs of the customers.

2. FINANCIAL RESULTS

(Rs. in Lakhs)

	Standalone		Consolidated
	Year ended 31-03-2023	Year ended 31-03-2022	Year ended 31-03-2023	Year ended 31-03-2022
Total Income	30,620.61	25,621.81	52,430.02	37,374.84
Less: Expenditure	23,849.81	19,946.10	40,950.14	30,046.04
Profits before Tax	6,770.80	5,675.71	11,479.88	7,328.80
Less: Income Tax Expense	1,568.87	1,277.72	2,524.40	1,639.83
Profit after Tax	5,201.93	4,397.99	8,955.48	5,688.97
Other Comprehensive Income (net of tax)	0.26	(5.42)	0.26	(5.42)
Total Comprehensive Income	5,202.19	4,392.57	8,955.74	5,683.55

Attributable to

a. Owners of the Company	5202.19	4392.57	8,831.84	5,512.02
b. Non Controlling Interest	Nil	Nil	123.90	171 .53

i) Financial Performance - Standalone:

The Company achieved total revenue from operations of Rs. 29,555.04 Lakhs for the year ended 31st March, 2023 as against Rs. 25,007.90 Lakhs for the year ended 31st March, 2022 representing an increase of18.18% because of increase in volume, average realization and change in product mix. During the financial year 2022-23, the Company earned a profit after tax of Rs. 5201.93 Lakhs as compared to Rs. 4397.99 Lakhs in the previous year

ii) Financial Performance - Consolidated

On consolidated basis the total revenue from operation of Rs. 51,699.56 Lakhs for the year ended 31st March, 2023 as against Rs. 36,823.29 Lakhs for the year ended 31 March 2022 representing an increase of40.40%. During the financial year 2022-23, the Company earned a profit after tax of Rs. 8955.48 Lakhs as compared to Rs. 5688.97 Lakhs in the previous year.

The above data has been extracted from the Audited Standalone and Consolidated Financial Statements prepared in accordance with the Indian Accounting Standards (Ind AS), as notified under Section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards Rules 2015) and the relevant provisions of the Act, as applicable.

3. DIVIDEND

The Board has recommended a dividend of Rs. 0.80 (Eighty Paisa) per equity share having face value of Rs. 2 each for the financial year ended 31st March 2023 (Dividend for financial year 2021-22 Rs. 0.40 per equity share of Rs. 2 each) at a total payout of Rs. 885.98 Lakhs out of its current profits, subject to the approval of Members at the ensuing Annual General Meeting (hereinafter referred to as ‘AGM) of the Company.

The Register of Members and Share Transfer Books of the Company will remain closed for the purpose of payment of dividend for the financial year ended 31st March 2023 and the AGM. In compliance with the requirements of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors of the Company has, formulated a Dividend Distribution Policy, which is available on the website of the Company at https://fineotex.com/wp-content/uploads/2021/08/ Dividend-Distribution-Policy.pdf

Pursuant to the provisions of Income-tax Act, 1961, the dividend paid or distributed by a company shall be taxable in the hands of the shareholders. Accordingly, in compliance with the said provisions, your Company shall make the payment of the dividend after necessary deduction of tax at source at the prescribed rates, wherever applicable. For the prescribed rates for various categories, the shareholders are requested to refer to the Income Tax Act, 1961 and amendments thereof.

4. RESERVES AND SURPLUS

During the current financial year, the Company has not transferred any amount to the General Reserves.

5. OPERATIONAL PERFORMANCE

With the expansion of our Ambemath plant capacity to an impressive 1,04,000 MTPA, the Company is now well equipped to not only meet the demands of the new product contracts but also anticipate and fulfill future orders with utmost efficiency. The increased capacity of the plant signifies a significant milestone in the companys growth strategy. By ramping up production capacity, the Company has enhanced the ability to cater to a broader range of market demands and seize new business opportunities. With this expansion, the Company has positioned itself as a reliable and trusted partner for the customers and ensuring that it can deliver on their evolving needs both now and in the foreseeable future.

The Company has been focused on sustainable growth and maximizing shareholders wealth. It has been included in the prestigious NIFTY Micro- Cap Index and Morgan Stanley Small Cap Index (MSCI). This recognition reflects Companys strong performance and market presence in the micro-cap segment. The Board is pleased to share that your company has entered the A group category of listed companies. This reclassification underscores Companys financial stability, transparency and adherence to regulatory standards, enhancing our visibility among investors.

Awards & Recognition:

• The Company has received the prestigious "Business Excellence Awards 2022" under the category ‘SME- Chemicals & Pharmaceuticals by Dun & Bradstreet Corporation.

• The Company is honored with "Business Growth and Strategy Excellence Award" at the Exclusive CXOs Roundtable, Mumbai

• The management is thrilled to inform that Company has been certified as "Great Place to Work" for the 2nd consecutive time.

• During the year Mr. Surendra Tibrewala, Chairman of the Company has been awarded with "Hurun Industry Achievement Award 2022" by the Hurun Research Institute.

• Mrs. Aarti Jhunjhunwala, Executive Director of the Company has been awarded with the ‘Women at Work Leadership Award at the thirteenth annual Asia Pacific HRM Congress Awards, presented by Times Ascent.

6. SHARE CAPITAL

During the current financial year there has been no change in the paid up capital of the Company. The Share Capital of the Company, at the beginning of the year as well as at the end of the year i.e. as on 31st March 2023 stands at Rs. 2,214.97 Lakhs divided into 11,07,48,420 equity shares of Rs. 2/- each. There has been no change in the outstanding share capital during the year.

7. EMPLOYEES SHARE OPTION SCHEME 2020

Your Company has adopted its Employees Stock Option Scheme- FCL-ESOP-2020 for granting options to eligible employees of

your Company as approved by the Members of your Company at the 17th Annual General Meeting held on 29th September, 2020.

The scheme is governed are governed by the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and in terms of the approvals granted by the shareholders of the Company, the Nomination and Remuneration Committee inter alia administers, implements and monitors the aforesaid schemes.

During the year the Nomination and Remuneration Committee at its meeting held on November 04, 2022 approved a fresh grant of 8,000 stock options to the employee of the Company. The total number of options outstanding as on March 31, 2023 are 49,511 stock options.

A certificate from the Secretarial Auditor of the Company, confirming that the aforesaid scheme have been implemented in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, will be open for inspection at the 20th Annual General Meeting of the Company.

8. SUBSIDIARIES

The details and performance of the subsidiary companies is provided below:

a. Foreign Subsidiaries:

Fineotex Malaysia Limited (FML), a Limited Company, was incorporated in a free trade zone in Labaun, Malaysia in 2011. FML in turn has controlling interest in three other companies in Malaysia that have established manufacturing and trading activities these Companies are BT Biotex SDN BHD, BT Chemicals SDN BHD and Rovatex SDN BHD. The synergy of the businesses has helped all the companies. BT Chemicals SDN BHD qualifies as a material subsidiary as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. The BT Chemicals SDN BHD has declared the final dividend to its holding company during the financial year 2022-23.

On 10th November, 2020, FML incorporated a wholly owned subsidiary -BT Biotex Limited, UAE with an initial investment of US$ 10,000.

Fineotex Specialties FZE was incorporated in the region of UAE on 25th January 2015 and operates in a free zone in UAE. It has been renamed as Fineotex Biotex Healthguard FZE after the strategic alliance with HealthGuard.

b. Indian Subsidiaries:

The Company incorporated a wholly owned subsidiary named Fineotex Specialities Private Limited on 5th September, 2020 with an investment of Rs. 100 lakhs to the Equity Capital, it has commenced operations from the 9th November, 2021 and it has contributed a standalone turnover of Rs. 16217.56 lakhs and a net profit before tax of Rs. 4616.57 lakhs as on 31st March 2023. Fineotex Specialities Private Limited also qualifies as a material

subsidiary in the financial year 2023-24 as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

Manya Steels Private Limited is the Indian Wholly Owned Subsidiary. It was acquired for diversification. It is not a material subsidiary as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

The details of the subsidiaries have been described in brief in the Corporate Governance Report which forms an integral part of this report.

Further, pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of subsidiary companies in Form AOC-1 is attached to the financial part of this report.

The separate audited financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of the Annual General Meeting.

9. CREDIT RATING

The Company has obtained Credit Rating of its various credit facilities and instruments from ICRA Limited and CRISIL Ratings Limited. ICRA Limited has provided Long Term Rating (A) and Short Term Rating (A1) to the bank facilities of the Company. Further during the year, CRISIL has upgraded their ratings on the bank facilities of the Company. The long term ratings has been upgraded from CRISIL A-/Stable to CRISIL A/Stable and short term ratings has been upgraded from CRISIL A2+ to CRISIL A.

10. FINANCE AND CAPITAL EXPENDITURE

The Companys finance position continues to be robust. During the year under review, the cash generation from operations reflect a positive contribution. This has been the Companys philosophy throughout and can be vouched over the years. The Company is a zero debt company. The borrowings are taken for short term requirements so that the investment portfolio is not abruptly disturbed. The Company has made substantial investment of Rs. 1907.22 Lakhs to increase its manufacturing activities and the same are financed from internal accruals/resources which were held as investments which is reflected in the Cash Generated from investing activities of the Cash Flow statement for the year ended 31st March, 2023.

11. MAJOR CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION AFTER THE YEAR END AND TILL THE DATE OF THIS REPORT

There were no material changes and commitments that occurred after the close of the year till the date of this Report, which affected the financial position of the Company.

During the year under review, there was no change in the nature of the business of the Company.

12. INTERNAL FINANCIAL CONTROLS SYSTEM AND THEIR ADEQUACY

Your Company has laid down adequate internal financial controls and checks which are effective and operational. These systems are designed in a manner which provides assurance with regard to maintenance of strict accounting control, optimum efficiency in operations and utilization of resources as well as financial reporting, protection of Companys tangible and intangible assets and compliance with policies, applicable laws, rules and regulations. The Audit Committee regularly interacts with the Internal Auditors, the Statutory Auditors and Senior Executives of the Company responsible for financial management and other affairs. The Audit Committee evaluates the internal control systems and checks & balances for continuous updation and improvements therein. The Audit Committee also regularly reviews and monitors the budgetary control system of the Company as well as the system for cost control, financial controls, accounting controls, physical verification, etc. The Audit Committee regularly observes that proper internal financial controls are in place including with reference to financial statements. During the year, such controls were reviewed, and no reportable material weakness was observed.

13. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company for the year ended 31st March 2023, have been prepared in accordance with the Indian Accounting Standards (IND AS) 110 - "Consolidated Financial Statements" as notified by Ministry of Corporate Affairs and as per the general instructions for preparation of Consolidated Financial Statements given in Schedule III and other applicable provisions of the Act, and in compliance with the SEBI Listing Regulations. The financial statements of the subsidiaries and the related detailed information will be made available to the shareholders of the Company seeking such information.

The Audited Consolidated Financial Statements along with the Auditors Report thereon forms part of the Annual Report.

14. PUBLIC DEPOSITS, LOANS AND ADVANCES

During the financial year 2022-23, the Company has not accepted any deposits from public within the meaning of Section 73 and Section 74 of the Act, therefore the disclosure pursuant to Rule 8 (5)(v) & (vi) of Companies (Accounts) Rules, 2014, is not applicable to the Company.

15. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 (3) of the SEBI (LODR) Regulations, 2015, on the operations of the Company as prescribed under Schedule V, is presented in a separate section forming part of the Annual Report Annexed as "Annexure - 1".

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/ OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given to the extent applicable in "Annexure - 2" forming part of this Report.

17. NOMINATION AND REMUNERATION POLICY

Pursuant to the provisions of Section 178 of the Act, and in terms of Regulation 19 read with Part D of Schedule-II of the SEBI Listing Regulations, the Company has a Nomination and Remuneration Policy for its Directors, Key Managerial Personnel and Senior Management which also provides for the diversity of the Board and provides the mechanism for performance evaluation of the Directors and the said Policy was amended from time to time. It includes criteria for determining qualifications, positive attributes and Independence of a Director. The Remuneration Policy is set out in "Annexure - 3" to the Directors Report. It is also available on the Companys website and can be accessed through the following link https://fineotex.com/wp-content/uploads/2021/08/ Nomination-and-Remuneration-Policy.pdf

18. EMPLOYEES

None of the employees (other than Whole-Time Director) who were employed throughout the financial year were in receipt of remuneration of more than Rs. 1,02,00,000 during the year ended 31st March, 2023, nor was their remuneration in excess of that drawn by the Managing Director or Whole-time Director.

There were no employees employed for any part of the financial year 31st March 2023 in receipt of remuneration more than Rs. 8,50,000 per month. No employee drew remuneration in excess of that of Managing Director and Executive Director.

The details of remuneration paid to executive directors and the ratio of the remuneration of each Director to the median employees remuneration and other details in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed to this report as "Annexure - 4".

19. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS.

The Company has not given any loan, guarantees or securities during the year that would attract the provisions of Section 185 of the Companies Act, 2013. Details of Loans, Guarantees and Investments which are within the limits specifies under Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014, are given in "Annexure - 5" forming a part of this report. Further the said details are also provided in the notes to the financial statements of the Company forming part of this Annual Report.

20. RELATED PARTY TRANSACTIONS / CONTRACTS

During the year, the Securities and Exchange Board of India (SEBI) has widened the definition and the scope of Related Party Transactions. All Related Party transactions entered into during the year were on arms length basis and were in the ordinary course of business. 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 Related Party Transactions are approved by the Audit Committee and the Company has obtained prior omnibus approval from the Audit Committee with respect of transactions which are repetitive in nature.

The shareholders have also given approval to these contracts and transactions at the 16th Annual General Meeting of the Company. Subsequently some of these were amended in the 17th and 18th Annual General meetings as explained therein.

Details of related party transactions are given in "Annexure - 6" giving the details as per AOC - 2.

The policy on Related Party Transactions as approved by the Board is available on the website of the Company and may be accessed through the web link https://fineotex.com/wp-content/ uploads/2023/05/RPT-Policy.pdf

21. CORPORATE SOCIAL RESPONSIBILITY

The Board, in compliance with the provisions of Section 135(1) of the Act and Rules made thereunder has formulated the CSR Committee and CSR Policy. Further, the CSR Policy has been placed on the website of the Company and can be accessed through the following link https://fineotex.com/wp-content/ uploads/2022/01/Corporate-Social-Responsibility-Policy.pdf.

The Companys key objective is to make a difference to the lives of the underprivileged, promote development through social and economic transformation and help them to bring a self-sustaining level. There is a deep commitment to CSR engagement. The Company is discharging this obligation by donating the amounts to the trusts which carry on these specified activities.

During the financial year 2022-23, the Company was required to spend Rs. 75.20 Lakhs, the minimum amount to be spent on CSR activity. The Company has spent Rs. 98.36 Lakhs during the financial year 2022-23. Accordingly, the excess amount for financial year 2022-23 shall be carried forward and will be available for set off against the CSR obligations of the Company for the subsequent 3 (Three) years. The brief details of the CSR obligations undertaken by the Company during the year under review has been annexed as "Annexure - 7".

22. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Your Companys Board comprises of 7 (Seven) Directors, of which 4 (Four) Directors are Non-Executive Independent Directors and 3 (Three) Directors are Executive Directors

a) Appointment/Resignation of Directors

During the financial year 2022-23, Mr. Anand V Patwardhan - Independent Non-Executive Director (DIN: 08908877) have resigned from the Directorship of the Company with effect from May 16, 2022 due to additional responsibilities from another state for the post of Deputy Director Bhubaneswar campus (Odisha state). He has also confirmed that there are no other material reasons attributable/ connected with the Company for their resignation. The Board places on record its deep appreciation for the contributions of Mr. Anand Patwardhan during his tenure as Independent Director of the Company.

b) Retirement by Rotation

Mrs. Aarti Jhunjhunwala is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, she offers herself for re-appointment. She is related to the Whole-time Directors of the Company and therefore a NonIndependent Director liable to retire by rotation and being eligible, she offers herself for reappointment. The brief profile of Mr. Aarti Jhunjhunwala has been annexed under Notice of Annual General Meeting.

c) Appointment/Resignation of Key Managerial Personnel

During the year under review Mr. Hemant Auti, Company Secretary and Compliance Officer of the Company has resigned due to personal reasons and further law education with effect from December 07, 2022.

Further, based on the recommendation of the Nomination & Remuneration Committee, the Board of the Company at its meeting held on 13th December 2022 has approved the appointment of Mr. Sunny Parmar as the Company Secretary and Compliance Officer of the Company with effect from 13th December, 2022. While considering the said appointment as the Company Secretary, the Board has considered his educational qualification, relevant knowledge, experience and skill set.

During the financial year 2022-23, the constitution of the Board complies with the requirements of the Act, and the SEBI Listing Regulations. There were no changes in Key Managerial Personnel of your Company during the financial year 2022-23 other than disclosed above.

23. BOARD MEETINGS

The Board of Directors of the Company met 6 (Six) times during the financial year i.e. on 28/04/2022, 24/06/2022, 29/07/2022, 04/11/2022, 13/12/2022 and 27/01/2023. Brief details of various Board Meetings and Meetings of the Committees are provided in the Corporate Governance Report given in "Annexure - 9" of this report.

24. DECLARATION OF INDEPENDENT DIRECTORS

During the financial year 2022-23, all the Independent Directors of the Company have given necessary declarations regarding

their Independence to the Board as stipulated in Section 149(6) & 149(7) of the Act read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation 16(1) (b) and 25(8) of the SEBI Listing Regulations

In the opinion of the Board, all the Independent Directors fulfil the conditions specified in the Act with regard to integrity, expertise and experience (including the proficiency) of an Independent Director and are independent of the management.

25. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

The Company conducts Familiarization Programme for Independent Directors to enable them to understand their roles, rights and responsibilities and proactively keeps them informed of the activities of the Company, its management and operations and provides an overall industry perspective as well as issues being faced by the industry. Companys policy on the familiarization program for the independent directors as well as details of familiarization programme imparted during the year is available on the Companys website at https://fineotex.com/wp-content/ uploads/2023/02/FCL-Familiarization-Programme-2022-23.pdf

26. BOARD EVALUATION

Pursuant to the provisions of the Act and the SEBI Listing Regulations, the Independent Directors at their meeting have evaluated the performance of Non-Independent Directors after considering the views of the Executive and Non-Executive Directors, Board as a whole and assessed the quality, quantity, and timeliness of flow of information between the Companys Management and the Board.

Further, the Board, upon recommendation of the Nomination and Remuneration Committee and as per the criteria and manner provided for the annual evaluation of each member of the Board and its Committees, has evaluated the performance of the entire Board, its Committees, and individual directors.

During the financial year 2022-23, all the members of the Board and its Committees met the criteria of performance evaluation as set out by the Nomination and Remuneration Committee.

27. AUDITORS AND AUDITORS REPORT (i) Statutory Auditors:

M/s. ASL & Co., Chartered Accountants (Firm Registration No. 101921W), were appointed as statutory auditors of the Company, at the 16th Annual General Meeting for a period of 5 years - i.e. till the conclusion of 21st Annual General Meeting to be held in 2024.

The Report given by ASL & Co., Chartered Accountants on the financial statements of the Company for the financial year 2022-23 is part of the Annual Report and there is no qualification, reservation, adverse remark, or disclaimer given by the Auditors in their Reports. The Auditors of the Company have not reported any fraud in terms of the second proviso to Section 143(12) of the Act.

(ii) Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors based on the recommendation of the Audit Committee appointed M/s HSPN & Associates LLP, Practicing Company Secretaries, to conduct Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report, pursuant to Section 204(1) of the Act for the financial year ended 31st March 2023 is annexed to this Report as "Annexure - 8" and forms part of this Report.

The Secretarial Audit Report for the financial year 2022-23 does not contain any qualification, reservation or adverse remarks.

The Company has undertaken an Annual Secretarial Compliance Audit for the financial year 2022-23 pursuant to Regulation 24A (2) of the SEBI Listing Regulations. The Annual Secretarial Compliance Report for the financial year ended 31st March 2023 has been submitted to the Stock Exchanges and the said report may be accessed on the Companys website at https://fineotex.com/wp-content/ uploads/2023/05/Secretarial-Compliance-Report-31st- March-2023.pdf

(iii) Cost Auditors:

M/s V J Talati & Co, Cost Accountants, of the Company had submitted the Cost Audit Report for the year 2022-23 within the time limit prescribed under the Act and Rules made thereunder.

Pursuant to Section 148 of the Act, read with the rules framed thereunder, the Board of Directors at its meeting held on 20th May 2023, upon the recommendation of the Audit Committee, re-appointed M/s V J Talati & Co as the Cost Auditor of the Company to conduct the audit of the cost records of the Company for the financial year 202324. The Company has received the necessary consent from M/s V J Talati & Co. to act as the Cost Auditor of the Company for the financial year 2023-24 along with the certificate confirming that his appointment would be within the applicable limits.

Further, pursuant to Section 148 of the Act, read with the rules framed thereunder, the remuneration payable to Cost Auditor for the financial year 2023-24 is required to be ratified by the Members of the Company at the ensuing AGM. Accordingly, an ordinary resolution seeking approval of members for ratification of payment of remuneration payable to the Cost Auditor is included in the Notice convening the ensuing AGM of the Company.

28. MAINTENANCE OF COST RECORDS

The Company is duly maintaining the cost accounts and records

as specified by the Central Government in compliance with

Section 148 of the Act.

29. RISK MANAGEMENT COMMITTEE

As per Regulation 21 of (Listing Obligation and Disclosure Requirements) Regulation, 2015, the provisions regarding Risk Management Committee. The management of the Company determines various aspects so as to be able to minimize the risk in all spheres of the Companys business from finance, human resources to business strategy, growth and stability. The Committee met twice in a year i.e. on 13 th July, 2022 and 06th January, 2023.

30. AUDIT COMMITTEE

The details pertaining to the composition of the Audit Committee are included in the Corporate Governance Report which forms a part of this Report. The Committee met 4 times during the year i.e. on 28th April, 2022; 29th July, 2022; 04th November, 2022; 27th January, 2023.

31. WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company has established a vigil mechanism for Directors and Employees to report their genuine concerns, details of which have been given in the Corporate Governance Report annexed to this Report. The copy of the Policy is available on the website of the Company and may be accessed through the web link https://fineotex.com/wp-content/uploads/2021/08/otherFCL- WhistleblowerPolicy.pdf

No complaints/suggestions were received during the year

32. HUMAN RESOURCES

The Company has a good mix of permanent employees and contract workers as on 31st March, 2023. From the total permanent employees, over 17.41% are women. We consider our employees as our most valuable asset.

The Company is aware that the success of its business depends upon its technical experts coordinating with research and development staff on one hand and marketing on the other. Necessary training and orientation are provided to our employees to equip them in providing productive and committed results.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary & trainees) are covered under the policy.

The following is a summary of sexual harassment complaints and disposed of during the year 2022-23.

No. of Complains received: NIL

No. of Complaints disposed off: NIL

Further the Company has also set up an Internal Complaint Committee as required to be formed under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The members of the committee are the female employees of the Company and they directly report to the management of the Company.

During the financial year 2022-23, the Committee submitted its Annual Report as prescribed in the said Act and there was no complaint as regards sexual harassment received by the Committee during the year.

34. DIRECTORS RESPONSIBILITY STATEMENT

Based on internal financial controls, work performed by Statutory Auditors, Secretarial Auditors and Cost Auditors with the concurrence of the Audit Committee, pursuant to Section 134(3) (c) read with Section 135(5) of the Companies Act, 2013 and as per Schedule II Part C (A)(4)(a) of the SEBI Listing Regulations, the Board states the following:

(i) In the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure, if any;

(ii) The Directors have selected such accounting policies as mentioned in Note 2 to the Notes to Financial Statements 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 of the Company for that period;

(iii) 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;

(iv) The Directors have prepared the Annual Accounts on a going concern basis;

(v) The Directors have laid down proper internal controls were in place and that the financial controls were adequate and were operating effectively and the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively and

(vi) The Directors have devised systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively

35. EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Annual Return as on 31st March, 2023 can be viewed on the website as per following link at www.fineotex.com.

36. CORPORATE GOVERNANCE

The Company strives to achieve appropriate Corporate Governance practices. In accordance with the requirements

of Schedule V read with Regulation 34(3) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 with the Stock Exchange, a report on the status of compliance of Corporate Governance norms is also attached as "Annexure - 9".

A certificate from the Statutory Auditors of the Company, confirming compliance with the conditions of Corporate Governance, as stipulated in the Listing Regulations forms part of the Annual Report.

37. BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

In accordance with Regulation 34(2)(f) of the Listing Regulations, BRSR, covering disclosures on the Companys performance on Environment, Social and Governance parameters for FY23, is part of this Integrated Report. BRSR includes reporting on the nine principles of the National Voluntary Guidelines on social, environmental and economic responsibilities of business as framed by the MCA. The same is attached as "Annexure - 10" and forms part of this Report.

38. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATION IN FUTURE

There are no significant/material orders passed by the Regulators/ Courts/Tribunals which would impact the going concern status of the Company and its future operations. During the year under review, no Corporate Insolvency Resolution application was made, or proceeding was initiated, by/against the Company under the provisions of the Insolvency and Bankruptcy Code, 2016 (as amended). Further, no application/proceeding by/against the Company under the provisions of the Insolvency and Bankruptcy Code 2016 (as amended) is pending as on 31st March 2023.

39. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

In terms of applicable provisions of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules"), during the year under review, unclaimed dividend amounting to Rs.11,077/- was transferred by the Company to the Investor Education and Protection Fund ("IEPF"), established by the Government of India.

40. TRANSFER TO UNCLAIMED SHARES TO IEPF

During the financial year 2022-23, the Company was required to transfer the unclaimed shares to IEPF pursuant to the provisions of Section 124(6) of the Act. The members who have a claim on dividends and shares which have been transferred to IEPF may claim the same from IEPF Authority by submitting an online application in web Form No. IEPF-5 available on the website of IEPF Authority at www.iepf.gov.in and sending a physical copy of the same, to the Company, along with requisite documents enumerated in the Form IEPF 5. During the year the Company has received claim from one of its shareholder in respect of the

dividend/shares so transferred to IEPF. The requisite forms with respect to claiming the shares/dividend so transferred to IEPF has been filed and the same is under process.

41. LISTING ON STOCK EXCHNAGES

The Companys 11,07,48,420 equity shares of Rs. 2 each as on 31st March 2023 are listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid the annual listing fees to these stock exchanges.

42. DEMATERIALISATION OF SHARES

There were 11,07,48,270 equity shares of the Company held by the shareholders in dematerialised form as on 31st March 2023, representing 99.99% of the total paid-up share capital of the Company consisting of 11,07,48,420 equity shares of Rs. 2 each. The Companys equity shares are compulsorily required to be traded in dematerialised form, therefore, Members are advised to speed up converting the physical shareholding into dematerialised form through their DP(s). Only 150 equity shares of Rs. 2 each are held in physical form.

43. COMPLIANCE OF SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India during the financial year.

44. GREEN INITIATIVE

As a responsible corporate citizen, the Company supports the ‘Green Initiative undertaken by the Ministry of Corporate Affairs, Government of India, enabling electronic delivery of documents including the Annual Report etc. to Members at their e-mail address registered with the Depository Participants ("DPs") and RTAs. To support the ‘Green Initiative, Members who have not

registered their email addresses are requested to register the same with the Companys Registrar and Share Transfer Agent ("RTAs")/ Depositories for receiving all communications, including Annual Report, Notices, Circulars, etc., from the Company electronically. Pursuant to the MCA Circular No. 10/2022 dated 28 December

2022 and SEBI Circular dated 05 January 2023, the Annual Report of the Company for the financial year ended 31 March

2023 including therein the Audited Financial Statements for the financial year 2022-23, are being sent only by email to the Members.

45. ACKNOWLEDGEMENTS

The directors place on record their appreciation for the contribution made by the employees at all levels enabling the Company to achieve the performance during the year under review.

Your directors wish to place on record their sincere appreciation for the continued support and cooperation extended to the Company by its bankers, customers, vendors, suppliers, dealers, investors, business associates, all the stakeholders, shareholders, various departments of the State and the Central Government and Investors who have put their faith in the Company.

For and on behalf of the Board

Surendrakumar Tibrewala	Sanjay Tibrewala
(Chairman & Managing Director)	(Executive Director)
DIN: 00218394	DIN: 00218525

Place : Mumbai Dated: August 4, 2023