Garnet International Ltd Directors Report

To Members,

The Directors present their Forty-Second (42nd) Annual Report with the Audited Financial Statements for the year ended 31st March, 2024.

1. FINANCIAL RESULTS (under Indian AS)

Financial Results are as under:

(Rs. in Lakhs)

Particulars	Standalone		Consolidated
	Year ended 31.03.2024	Year ended 31.03.2023	Year ended 31.03.2024	Year ended 31.03.2023
Income for the year	1966.39	2161.57	2032.99	5933.09
Expense for the year	2107.03	1975.96	2166.87	5551.43
Profit before Tax and Interest	(140.64)	185.62	(133.88)	381.66
Current Tax	-	-	1.76	50.57
Provisions for Taxation/ Deferred Tax	0.77	(0.04)	0.77	4.81
Net Profit / (Loss) for the Current Year	(141.41)	185.66	(136.41)	326.27
Profit from Associate Company	-	-	82.39	-
Exceptional Items	-	-	544.37	-
Net Profit After Tax	(141.41)	185.66	(598.40)	326.27
Transfer to General Reserves	-	-	-	-
Balance carried to Balance Sheet	(141.41)	185.66	(598.40)	326.27

2. OPERATIONS

The Standalone Operating Income of the Company is derived from a mix of dividend, interest income, income from derivatives and other income. During the year under review, on Standalone basis your Company recorded a total income of Rs. 1966.39 Lakhs as compared to last years total Income of Rs. 2167.57 Lakhs and Net Loss of Rs. 141.41 Lakhs as compared to last years net loss of Rs. 185.66 Lakhs.

3. DIVIDEND

Board of Directors has decided not to recommend any dividend for the year ended 31st March 2024.

4. TRANSFER TO RESERVES

No amount was transferred to General Reserve during the year.

5. MANAGEMENT DISCUSSION AND ANALYSIS

Global Markets

The fiscal year 2023-24 was a challenging period for the global economy, characterized by a confluence of factors that created a volatile market environment. Lingering geopolitical tensions, persistent inflation, and ongoing supply chain disruptions posed significant challenges for investors and businesses alike.

Global economic growth remained sluggish, with many major economies experiencing slower expansion compared to pre-pandemic levels. Rising interest rates and geopolitical uncertainties weighed on economic activity, creating a challenging backdrop for businesses and consumers. Inflationary pressures persisted, albeit at a moderated pace compared to earlier in the fiscal year. Central banks worldwide implemented monetary tightening measures to curb inflation, which led to increased borrowing costs for businesses and individuals, potentially dampening economic activity.

Geopolitical conflicts, particularly the Russia-Ukraine war, contributed to market volatility and disrupted supply chains for certain commodities and goods. Supply chain disruptions, exacerbated by the pandemic and geopolitical factors, persisted, leading to shortages of certain products and contributing to inflationary pressures.

Looking ahead, the global economic outlook for FY 2024-25 remains uncertain. While there are expectations for a gradual recovery, several risks and challenges persist. Inflationary pressures could necessitate further monetary tightening measures, impacting economic growth. Continued geopolitical tensions could disrupt global trade and investment flows. Addressing supply chain vulnerabilities remains a priority to ensure a more resilient global economy. High levels of public and private debt in many countries pose risks to financial stability.

Global growth, estimated at 3.2 percent in 2023, is projected to continue at the same pace in 2024 and 2025. Global headline inflation is expected to fall from an annual average of 6.8 percent in 2023 to 5.9 percent in 2024 and 4.5 percent in 2025.

Indian Equity Markets

The global stock market experienced a tumultuous period, characterized by periods of both gains and losses. The uncertainty surrounding economic conditions and geopolitical events created a challenging environment for investors worldwide. Certain sectors, such as technology and healthcare, demonstrated relative strength, benefiting from factors like technological advancements and increased healthcare spending. However, sectors like energy and materials faced headwinds due to fluctuating commodity prices and economic indicators.

Emerging markets, including India, witnessed a mixed performance. While some emerging markets demonstrated resilience, others were impacted by factors such as currency fluctuations and domestic economic challenges. The overall performance of emerging markets was influenced by global economic conditions, investor sentiment, and country-specific factors.

Despite the global headwinds, the Indian stock market exhibited a notable degree of resilience. Several factors contributed to its performance. Indias strong domestic economic fundamentals, including robust growth, a relatively stable currency, and government initiatives to boost investment, provided a supportive backdrop for the stock market. Foreign investors continued to show interest in the Indian market, attracted by its long-term growth prospects and diverse sectors. Certain sectors, such as information technology and pharmaceuticals, led the Indian market, benefiting from strong fundamentals and global demand. Government policies aimed at promoting economic growth, improving infrastructure, and fostering a favourable business environment played a positive role in supporting the stock market.

Risks and Concerns

The very nature of the Companys business makes it subject to various kinds of risks. The Company encounters credit risk and operational risks in its daily business operations. Further the performance of the Company is dependent on the capital markets for its returns. Even though it is envisaged that Indian stock market will continue to do well, global concerns can result in sharp corrections.

Financial Performance and Operational Review

The paid up equity share capital of the Company as on March 31, 2024 stands at Rs. 19,63,50,000/- divided into 1,96,35,000 fully paid up equity shares of Rs. 10/- each.

Net Worth

The Net Worth of the Company stands at Rs. 2514.67 lakhs.

Total Income

During the year total income was reported at Rs. 1966.39 lakhs.

Credit Facilities

The Company has not availed any credit facility. It has consistently been able to meet its financial needs through internal accruals.

Finance Cost

The finance cost of the Company stands at Nil

Tax Expense

The Company has incurred a tax expense of Nil in the current year.

6. FIXED DEPOSITS

The Company has not accepted any public deposits under the provisions of the Companies Act, 2013 (‘Act).

7. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The provisions of section 186 of the Act pertaining to investment, guarantee and lending activities are not applicable to the Company since the Company is a Non Banking Financial Company ("NBFC") whose principal business is acquisition of securities.

8. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company form part of the Annual Report. The annual accounts of the subsidiary company and related detailed information are available on the website of the Company and the same may be obtained by writing to the Company Secretary at the Registered e-mail ID of the Company: secretarial@garnetint.com

The consolidated financial results reflect the operations of Whitewall India Private Limited ("Whitewall") as subsidiary company and Sukartik Clothing Pvt. Ltd. ("Sukartik") as associate company. The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 16(1)(c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations). The Policy, as approved by the Board, is available on the Companys website: www.garnetint.com. As on March 31, 2024, none of the subsidiaries of the Company fulfils the criteria given under Regulation 16(1)(c) of the Listing Regulations.

Subsidiary & Associate Companies:

The Company is having a Subsidiary i.e. Whitewall India Private Limited and a Associate i.e. Sukartik Clothing Private Limited. The Company acquired the majority stake in Whitewall India Private Limited during the year. Further pursuant to allotment of equity shares under preferential allotment to its promoters, the stake of Garnet in Sukartik reduced to 47.31% and accordingly Sukartik ceases to be a subsidiary and becomes a associate company of Garnet. There has been no material change in the nature of business of the subsidiary or associate companies.

In accordance with the General Circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Statement of Profit & Loss and other documents of the Subsidiary and Associate Companies are not being attached with the Balance Sheet of the Company. However, the financial information of the Subsidiary and Associate Companies are disclosed in the Annual Report in compliance with the said circular in Form AOC 1 as Annexure - A.

9. BOARD AND COMMITTEE MEETINGS

During the year under review, Eight Board Meetings were held. The details of the composition of the Board and its Committees and of the Meetings held and attendance of the Directors at such Meetings are provided in the Corporate Governance Report. There have not been any instances during the year when recommendations of the Audit Committee were not accepted by the Board.

10. DIRECTORS RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during the financial year 2023-24.

Accordingly, pursuant to Section 134(3)(c) and 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that: –a. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

b. they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

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

d. they have prepared the annual accounts on a going concern basis;

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

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

11. RISK MANAGEMENT

The Company has adopted a Risk Management Policy in accordance with the provisions of the Act and Regulation 17(9) of the SEBI Listing Regulations. It establishes various levels of risks with its varying levels of probability, the likely impact on the business and its mitigation measures.

The Company has a robust Risk Management framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Companys competitive advantage.

12. INTERNAL CONTROL SYSTEMS

The Company maintains appropriate systems of internal controls, including monitoring procedures, to ensure that all assets and investments are safeguarded against loss from unauthorized use or disposition. Company policies, guidelines and procedures provide for adequate checks and balances and are meant to ensure that all transactions are authorized, recorded and reported correctly.

The Internal Auditors reviews the efficiency and effectiveness of these systems and procedures. Added objectives include evaluating the reliability of financial and operational information and ensuring compliances with applicable laws and regulations. The Internal Auditors submit their Report periodically which is placed before and reviewed by the Audit Committee.

13. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee Chairman.

14. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were on an arms length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and the Listing Regulations. There were no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions, if any.

15. CORPORATE SOCIAL RESPONSIBILITY

In terms of section 135 and Schedule VII of the Act, the Board of Directors has constituted a CSR Committee under the Chairmanship of Mr. Suresh Gaggar. Mrs. Sandhya Lotlikar, Mr. Suresh Kumar Gaur and Mr. Ramakant Gaggar are the other members of the Committee.

The Annual Report on CSR activities is annexed herewith as "Annexure B".

16. CHANGE IN NATURE OF BUSINESS

There has been no change in nature of business of the company during the F.Y. 2023-2024. Your company is engaged in other financial services i.e. Investment in securities etc. so there is only one segment reporting as per IND AS 108

17. POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT

WORK PLACE

The Company has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013 and the Rules thereunder. The Policy aims to provide protection to employees at the work place and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has also constituted an Internal Complaints Committee, known as the Prevention of Sexual Harassment ("POSH") Committee, to inquire into complaints of sexual harassment and recommend appropriate action.

The Company had no complaints of sexual harassment at the beginning of the year and has not received any complaints during the financial year. Accordingly, there are no complaints pending at the end of the financial year 2023-2024.

18. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

No significant material orders are passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

19. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Pursuant to the provisions of the Act and the Companys Articles of Association, Mr. Navratan Gaggar (DIN 01655621), retires by rotation and, being eligible, offers himself for re-appointment. A resolution seeking shareholder approval for his reappointment forms part of the Notice.

During the year, Mr. Shyaam Taaparia (DIN: 07369692) resigned from the post of Independent Director on 25^th January 2024, due to pre-occupation and other professional commitments. Later, based on the recommendations of Nomination and Remuneration Committee, the Board appointed Mr. Suresh Kumar Gaur (DIN 10550622) as Independent Director of the Company, for a period of five years with effect from 18^th March 2024. Later, the appointment of Mr. Gaur was also approved by shareholders via postal ballot passed on 25^th May, 2024. Further, on recommendations of Nomination and Remuneration Committee, Mrs. Sandhya Lotlikar (DIN 08329535) and Mr. Vishnu Kanth Bhangadia (DIN: 02405217), were re-appointed as independent directors for their second term of 5 years via postal ballot resolutions passed on 4^th January 2024 and 25^th May, 2024 respectively.

Pursuant to the provisions of Section 149 of the Act, the Independent Directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. In terms of Regulation 25(8) of SEBI Listing Regulations there has been no change in the circumstances affecting their status as Independent Directors of the Company. Further, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company.

Pursuant to the provisions of Section 203 of the Act, Mr. Sanjay Raut, Chief Financial Officer continued as Key Managerial Personnel of the Company as on 31st March, 2024.

Details pertaining to Director seeking re-appointment together with other directorships and committee membership have been given in the annexure to the Notice of the AGM in accordance with the requirements of the SEBI Listing Regulations and Secretarial Standard-2 on General Meetings.

20. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS

COMMITTEES AND OF INDIVIDUAL DIRECTORS

Pursuant to the provisions of the Act and Listing Regulations, the Board has carried out an annual evaluation of its own performance, performance of the Directors individually as well as the evaluation of the working of its committees.

The Nomination and Remuneration Committee has defined the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and individual Directors, including the Chairman of the Company. The above criteria are broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on 5th January, 2017.

For evaluating the Board as a whole, views were sought from the Directors on various aspects of the Boards functioning such as degree of fulfilment of key responsibilities, Board Structure and composition, establishment, delineation of responsibilities to various committees, effectiveness of Board processes, information and functioning, Board culture and dynamics, quality of relationship between the Board and the management.

Similarly, views from the Directors were also sought on performance of individual Directors covering various aspects such as attendance and contribution at the Board/Committee Meetings and guidance/support to the management outside Board/Committee Meetings. In addition, the chairman was also evaluated on key aspects of his role, including setting the strategic agenda of the Board, encouraging active engagement by all Board members and promoting effective relationships and open communication, communicating effectively with all stakeholders and motivating and providing guidance to the Executive Director.

Areas on which the Committees of the Board were assessed included degree of fulfillment of key responsibilities, adequacy of Committee composition, effectiveness of meetings, Committee dynamics and quality of relationship of the Committee with the Board and the Management.

The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Board as a whole. The Nomination and Remuneration Committee also reviewed the performance of the Board, its committees and of individual Directors.

21. REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration.

22. AUDITORS

(i) Statutory Auditors

Pursuant to provisions of Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014, M/s. B.M. Gattani & Co., Chartered Accountants, Mumbai, (ICAI Registration No. 113536W) , the Statutory Auditors of the Company were appointed at the 37th Annual General Meeting of the Company to hold office for a term of 5 (five) consecutive years until the conclusion of the 42nd Annual General Meeting of the Company.

Accordingly, M/s. B.M. Gattani & Co., Chartered Accountants, will cease to be the Statutory Auditors of the Company on the conclusion of forthcoming 42nd AGM of the Company.

Pursuant to provisions of Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014, the Audit Committee and the Board of Directors of the Company have recommended appointment of M/s Sarda Soni Associates LLP, Chartered Accountants (Firm Registration No. 117235W/W100126) as the Statutory Auditors of the Company for a term of 5 (five) years to hold office from the conclusion of forthcoming 42nd AGM until the conclusion of the 47th AGM of the Company, in place of retiring Statutory Auditors namely B.M. Gattani & Co., Chartered Accountants. A resolution seeking the appointment of M/s Sarda Soni Associates LLP, Chartered Accountants as Statutory Auditors of the Company forms part of the Notice of 42nd AGM and the same is recommended for Members approval. Pursuant to Section 141 of the Act, the appointing Auditors have represented that they are not disqualified and are eligible to act as the Statutory Auditors of the Company.

Auditors report for the financial year ended 31st March, 2024 forms part of this Annual Report. Following mentioned remarks are given by the Auditors of the Company in their Audit Report for the year ended 31st March, 2024:

a) The Company had granted interest free unsecured loan to its associate company, yearend balance of such loan is NIL, Company has not made interest provision nor received any Interest on the said loan (parties covered under section 186 of the Companies Act, 2013), which is in non- compliance of provisions of Section186(7) of the Act.

b) The Company has neither paid nor provided interest on its borrowings during the financial year. Had such interest been recognised, the finance cost and interest liability for the year ended March 31, 2024 would have been further increased to that extent. Consequently, the reported Loss after Other Comprehensive Income by the Company for the year would have been further increased to that extent.

c) The Company has granted interest free unsecured Inter-Corporate loan (parties covered under section 186 of the Companies Act, 2013) of Rs. 12,00,000/-, yearend balance of such loan is Nil, which is in non- compliance of provisions of Section 186(7) of the Act.

Management Reply for the Remark given by Statutory Auditor:

Company ensures to recover the interest from companies in next financial year. The Company also ensure to take corrective for other matters.

(ii) Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Siddharth Sharma & Associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as "Annexure C". For the Financial Year ended on 31^st March, 2024, none of the Subsidiary Company falls under category of "Material Subsidiary".

The Secretarial Audit Report has a qualification regarding the composition of the board not in compliance as per Regulation 17(1) of SEBI Listing Regulations for 52 days in quarter ended March 31, 2024, to which the management states that due to sudden resignation of Mr. Shyaam Tapaaria, as Independent Director on January 25, 2024, a vacancy was created, it was challenging for the company to find a suitable candidate to fit in the position of Independent Director of a listed entity in a very short time span, however, the non-compliance was made good by appointment of Mr. Suresh Kumar Gaur as Additional (Non-Independent & Non-Executive) Director on March 18, 2024.

Further there were non-compliance under Regulation 3(5) of SEBI (PIT) Regulations 2015, wherein company failed to update entries in SDD Software on timely manner, to which management states that company was updating the software as per requirement under aforesaid regulations, however due to technical issue the main computer server got corrupt and few backup files got deleted, which led to data loss. Re-entries were made and in order to avoid re-occurrence of such incidents, more robust server backup system, to ensure regular and secure data backup, have been implemented. Further Company was non complied with regulation 44 (3) of SEBI (LODR) Regulations 2015, wherein voting results were not submitted on time and BSE imposed fine to which management states that voting results were submitted to BSE on time, however there was typographical error of "year" in xbrl file wherein 2023 was mistakenly written instead of 2024. Error did not affect the accuracy of information contained in xbrl file of voting results. Further error was only present in xbrl file and not in pdf file which was also submitted on time. Company had submitted the revised xbrl after discrepancy was known. Further a waiver application is already been filed with BSE for the same which is still pending.

(iii) Cost Records and Cost Auditors

The provisions of Cost Audit and Records as prescribed under Section 148 of the Act, are not applicable to the Company.

23. SECRETARIAL STANDARDS OF ICSI

The Company is in compliance with the Secretarial Standards on Meetings of the Board of Directors (SS – 1) and General Meetings (SS – 2) issued by the Institute of Company Secretaries of India and approved by the Central Government.

24. CORPORATE GOVERNANCE

The Annual Report contains a separate section on the Companys corporate governance practices, together with a certificate from the Companys Auditors confirming compliance, as per SEBI Listing Regulations.

25. BUSINESS RESPONSIBILITY REPORTING

Regulation 34 (2) (f) of SEBI (LODR) Regulations related to Business Responsibility Report is not applicable to the Company.

26. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return in Form MGT-7 for FY 2023-24 will be uploaded on the Companys website: www.garnetint.com.

27. REPORTING FRAUD

During the year under review, the Statutory Auditor and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees, to the Audit Committee under Section 143(12) of the Act details of which needs to be mentioned in this Report.

28. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION

AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Since the company is an Investment Company and has no manufacturing activity or other operations. Therefore, the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 are not applicable. There were no foreign exchange earnings or outgoing during the financial year ended 31st March, 2024.

29. PARTICULARS OF EMPLOYEES AND REMUNERATION

The information required under Section 197(12) of the Act read with Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as "Annexure D".

Details required under the provisions of section 197(12) of the Act read with rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, will be made available to any member on request, as per provisions of section 136(1) of the Act.

30. ACKNOWLEDGEMENTS

The Board wishes to place on record their sincere appreciation for the continued support which the Company has received from all its stakeholders and above all, its employees.

For and on behalf of the Board of Directors

Suresh Gaggar

Chairman

DIN: 00599561

Mumbai, 14th August, 2024