Haryana Leather Chemicals Ltd Directors Report

1. There are no material changes and commitments affecting the financial position of your Company which have occurred between the end of the financial year and the date of this report.

2. Previous year figures have been regrouped/re-arranged wherever necessary.

3. There has been no change in nature of business of your Company.

Plant Locations:

The total income from operations for the year ended 31^st March, 2025 aggregated to Rs. 5072.47 Lakhs as compared to Rs. 4797.51 Lakhs in the previous year. The company was able to earn a profit after tax ofRs. 230.01Lakhs. The operation resulted in profit before exceptional items, tax and regulatory deferral account balances for the year under review of Rs 424.04 Lakhs as compared to profit of Rs. 651.13 Lakhs in the previous year. Exceptional items for the year under review was nil.

No material changes and commitments which affect the financial position of the Company have occurred after the close of the year under review till the date of this Report

Dividend

Based on the Companys performance, the Board recommended a dividend of Rs.1 per share of Rs 10 Per Share, subject to the approval of the Members. The final dividend on equity shares, if approved by the Members, would involve a cash outflow of Rs 49.08 Lacs. Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of the Members effective April 1, 2020, and the Company is required to deduct tax at source (TDS) from dividend paid to the Members at rates prescribed as per the Income-Tax Act, 1961. The Record date for the purpose of the final dividend for the financial year ended March 31, 2025, is 49.08 Lacs .

The Board of Directors has decided to retain the entire number of profits for FY 2024-25 in the retained earnings.

During the year under review, there was no change in the authorized and paid-up share capital of the Company. The paid-up Equity Share Capital of the Company as on 31^st March, 2025, was Rs. 49,08,4,700 divided into 49,08,470 Equity Shares of Rs.10/- each Also, Your Company has not issued any: o Shares with differential o Sweat equity shares o Equity shares under Employees Stock Option Scheme

There were no outstanding deposits within the meaning of Section 73 and 74 of the Act read with rules made thereunder at the end of FY25 or the previous financial years. Your Company did not accept any deposit during the year under review.

As on March 31, 2025 the Company had no material subsidiaries. Your Company has formulated a policy for determining Material Subsidiaries. The policy is available on your Companys website and link for the same is given in Corporate Governance Report.

The company has sustained its growth and market ranking due to specialty products -both in leather chemicals and PVC additives division.

Leather Chemicals: The company continues its market leadership in fat liquor for gloving and upholstery. Our product NOUVOL SR and its variants are market leaders. The new pigment series NANOLUX that was launched a year ago has been accepted for high end applications as a specialty product. NANOLUX Deep Black and NANOLUX Ultra-white have proven their performance against world leaders like STAHL and SOMMER. The company is aiming to place NANOLUX as a top end specialty product that will boost the companys image.

PVC Additives: Since the launch of PVC additives in 2024: mainly Acrylic Impact Modifier (AIM) and Acrylic

Processing Aid (PA), the companys R&D and marketing team have worked in close coordination to benchmark the product performance to beat the best in the segment. The company has received very encouraging results on AIM and its AKRELON 405 is emerging as a specialty product. The company is likely to command a leading role amongst indigenous producers as the AKRELON 405 has received widespread acceptance across Indias leading PVC processors. The trademark AKRELON has also been registered under no. 6400777 dated 23^rd April 2024.

As of March 31, 2025, your Companys Board had Eight (8) members comprising of two (2) Executive Directors, two (2) non-executive and four (4) Independent Directors, including one Woman Director. The details of Board and Committee composition, tenure of directors, and other details are available in the Corporate Governance Report, which forms part of this Annual Report.

In terms of the requirement of the Listing Regulations, the Board has identifiedcore skills, expertise, and competencies of the Directors in the context of the Companys business for effective functioning. The key skills, expertise and core competencies of the Board of Directors are detailed in the Corporate Governance Report, which forms part of this Integrated Annual Report.

During the year under review, following changes took place in the Directorships and Key Managerial Personnel a) Mr. Pankaj Jain (DIN: 00206564) shall retire by rotation at the ensuing Annual General Meeting and are eligible and have offered themselves for re-appointment. b) Re-appointment of Mr. Pankaj Jain, (DIN: 00206564) as Managing Director of the Company for a further period of five years from 2 ^nd April, 2025 to 1^st April 2030 and same was approved by the Shareholders through postal ballot. c) Appointment of Mr. Chinar Goel, (DIN: 00486730) as an Independent Director of the Company for a term of five consecutive year. d) Appointment of Mr. Kanishk Gupta (DIN: 02243899) as an Independent Director of the Company for a term of five consecutive year. e) Appointment of Ms. Ritu Atri (DIN: 09596000) as an Independent Director of the Company for a term of five consecutive year. f) Appointment of Ms. Pradeep Kumar Verma (DIN: 10749814) as an Independent Director of the Company for a term of five consecutive year g) After closure of Financial Year, the Board of Director on the recommendation of Nomination and remuneration committee has approved re-appointment of Ms. Sippy Jain (DIN: 03189151) as Whole Time Director w.e.f. 30th July, 2025 to 29th July, 2030 h) Mr. Silun Nanda resigned from the Company Secretary of the company w.e.f 30th September, 2024. i) Mr. Yugank was appointed as Company Secretary of the company w.e.f 06th October, 2024.

In accordance with the provisions of Section 152 of the Act, read with rules made thereunder and Articles of Association of your Company, Mr. Pankaj Jain (DIN: 00206564) is liable to retire by rotation at the ensuing AGM and being eligible, offers himself for re- appointment.

The Board recommends the re-appointment of Mr. Pankaj Jain as Director for your approval. Brief details as required under Secretarial Standard-2 and Regulation 36 of SEBI Listing Regulations, are provided in the Notice of AGM.

The Board met 6 (Six) times during the year under review. The intervening gap between the meetings did not exceed 120 days, as prescribed under the Act and SEBI Listing Regulations. The details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report, which forms part of this Integrated Annual Report.

Your Company has received declarations from all the Independent Directors of your Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1) of the SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as an Independent Director. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

The Independent Directors of your Company have confirmed that

(a) they meet the criteria of Independence as prescribed under Section 149 of the Act and Regulation 16 of the

Listing Regulations 2015, and

(b) they are not aware of any circumstance or situation, which could impair or impact their ability to discharge duties with an objective independent judgment and without any external influence.

Further, in the opinion of the Board, the Independent Directors fulfill the conditions prescribed under the

Listing Regulations 2015 and are independent of the management of the Company.

In terms of Section 149 of the Act, Mr. Chinar Goel, Ms. Ritu Atri, Mr. Kanishk Gupta & Mr. Pradeep Kumar Verma are the Independent Directors of the Company. The Company has received declarations from all the Independent

Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and

Regulation 16(1)(b) of the SEBI Listing Regulations and are independent of the Management. In terms of Regulation

25(8) oftheSEBIListingRegulations,theyhaveconfirmed that they are not aware of any circumstance or situation which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. The Board of Directors of the Company has taken on record the declaration and confirmation submitted by the Independent Directors after undertaking due assessment of the veracity of the same. The Board is of the opinion that all Directors including the Independent Directors of the Company possess requisite the fields of science and technology, digitalization, strategy, qualifications, finance, governance, human resources, safety, sustainability, etc. The Independent Directors of the Company have confirmed that they have enrolled themselves in the Independent Directors Databank maintained with the

Indian Institute of Corporate Affairs (‘IICA) in terms of Section 150 of the Act read with Rule 6 of the Companies

(Appointment & Qualification of Directors) Rules, 2014.

As on the date of this report, the following are Key Managerial Personnel ("KMPs") of the Company as per Sections 2(51) and 203 of the Act:

Mr. Pankaj Jain, Managing Director

Mrs. Sippy Jain, Whole time Director, Executive Director

Mr. Sukanto Choudhury, Chief Financial Officer

Mr. Yugank, Company Secretary

As per provisions of the SEBI (Listing Obligation and Disclosure Requirement) (Amendment) Regulation, 2018, which had come into force w.e.f. 1.4.2019, in line with the modifications, corresponding changes have been made in the Nomination and Remuneration Policy of the Company by the Board on the recommendation of Nomination & Remuneration Committee. The Nomination and Remuneration Policy is available on our website at https://www. leatherchem.com/pdf/Nomination-and-Remuneration-Policy.pdf .

The Company has revised a Policy for performance evaluation of the Board, Committees and other individual Directors (including Independent Directors) which includes criteria for performance evaluation of Non-executive Directors and Executive Directors. The evaluation process inter alia considers the attendance of Directors at Board and committee meetings, acquaintance with business, communicating inter-se board members, effective participation, domain knowledge, compliance with code of conduct, vision, and strategy.

The Board carried out an annual performance evaluation of the Board, Committees, Individual Directors and the Chairperson. The Chairman of the respective Committees shared the report on evaluation with the respective Committee members. The performance of each Committee was evaluated by the Board, based on the report on evaluation received from respective Committees. The report on performance evaluation of the Individual Directors was reviewed by the Chairman of the Board and feedback was given to Directors.

The Company follows the best governance practices to boost long-term shareholder value and respect minority rights. The Company considers the same as its inherent responsibility to disclose timely and accurate information to its stakeholders regarding its operations and performance, as well as the leadership and governance of the Company. The Company is committed to the HLCL Code of Conduct which articulates values and ideals that guide and govern the conduct of the Haryana Leather Chemicals Limited as well as its employees in all matters relating to business.

The Companys overall governance framework, systems and processes reflect and support its Mission, Vision and

Values. At HLCL, human rights is also an integral aspect of doing business and the Company is committed to respect and protect human rights to remediate adverse human rights impacts that may be resulting from or caused by the Companys businesses. In furtherance to this, the Company has in place the ‘Haryana Leather Chemicals Limited code of conduct which aligns with the principles contained in the Human Rights and is consistent with the HLCL Code of Conduct.

The Companys governance guidelines cover aspects mainly relating to composition and role of the Board, Chairman and Directors, Board diversity, retirement age for the Directors and Committees of the Board. The Company has in place a compliance management system for monitoring the compliances across its plant and office.A compliance certificate is also placed before the Board of Directors every quarter. In compliance with the SEBI Listing Regulations, the Corporate Governance Report and the Secretarial Auditors Certificate this Annual Report.

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors to the best of their knowledge and ability, confirm in respect of the Audited Annual Accounts for the year ended 31st March, 2025 that: a. in the preparation of the annual accounts, the applicable accounting standards had been followed and that there were no material departures; b. the Directors had, in consultation with the Statutory Auditors, 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 for the year ended 31^st March, 2025 and profit of the Company for that period; c. the Directors had 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 had prepared the annual accounts on a going concern basis; e. the Directors had laid down proper internal financial controls to be followed and that such internal financial controls were adequate and were operating effectively; and f. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

The details in respect of internal financial controls and their adequacy are included in the Management Discussion and Analysis Report, which forms part of this Integrated Annual Report.

The Management Discussion and Analysis Report for the year under review, as stipulated under the SEBI Listing Regulations, is presented in a section forming part of this Annual Report.

Your Company is committed to maintain highest standards of corporate governance practices. The Corporate Governance Report, as stipulated by SEBI Listing Regulations, forms part of this Annual Report along with the required certificate from a Practicing Company Secretary, regarding compliance of the conditions of corporate governance, as stipulated.

In compliance with corporate governance requirements as per the SEBI Listing Regulations, your Company has formulated and implemented a Code of Conduct for all Board members and senior management personnel of your

Company ("Code of Conduct"), who have affirmed the compliance thereto. The Code of Conduct is available on the website of your Company at https://www.leatherchem.com/pdf/Code-of-conduct-of-Board-of-Directors-and-Senior-Management-Personnel.pdf .

Pursuant to Section 134(3)(a) of the Act, the draft annual return as on March 31, 2025 prepared in accordance with Section 92(3) of the Act is made available on the website of your Company and can be accessed using the https:// www.leatherchem.com/pdf/MGT-7.pdf.

All transactions with related parties are placed before the Audit Committee for its prior approval. Further, only those members of the Committee, who are Independent Directors, approve the related party transactions. An omnibus approval from Audit Committee is obtained for the related party transactions which are repetitive in nature. All transactions with related parties entered into during the year under review were at arms length basis and in the ordinary course of business and in accordance with the provisions of the Act and the rules made thereunder, the SEBI Listing Regulations and your Companys Policy on Related Party Transactions.

The Audit Committee comprise solely of the Independent Directors. The members of the Audit Committee abstained from discussing and voting in the transaction(s) in which they were interested.

The details of Related Party Transactions, as required under Indian Accounting Standard-24 (Ind AS-24), are provided in the accompanying Financial Statements forming part of this Annual Report. Form AOC-2 pursuant to Section 134 (3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is set out as "Annexure-A" to this Report.

Your Company did not enter into any related party transactions during the year under review, which could be prejudicial to the interest of minority shareholders.

The Policy on Related Party Transactions is available on your Companys website and can be accessed using the link: https://www.leatherchem.com/pdf/HLCL-RPT-Policy.pdf .

Pursuant to the provisions of Regulation 23 of the SEBI Listing Regulations, your Company has filed half yearly reports to the stock exchanges, for the related party transactions

Pursuant to the provisions of Section 139 of the Act read with rules made thereunder, as amended from time-to-time M/s. S.C Deewan & Co. Chartered Accountants, were appointed as Statutory Auditors of the Company, for a period of five consecutive years at the Annual General Meeting held on September 24, 2022, to hold his office till the conclusion of 42nd Annual General Meeting of the Company to be held in 2027.

The Statutory Auditor has confirmed their eligibility and submitted the certificate disqualified to hold the office of the statutory auditor.

Further, in terms of the SEBI Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.

Statutory Auditors have expressed their unmodified opinion on the Standalone Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, or statements referred in the Auditors Report are self-explanatory.

The Notes to the financial statements referred in the Auditors Report are self-explanatory.

The said Audit Report does not contain any qualification, reservation or adverse remark. During the year 2024-25, the Auditors had not reported any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3) (ca) of the Act.

M/s Neeraj Gupta & Associates., Practicing Company Secretaries (CP No. 4006 & Membership No- F-5720), were appointed as the Secretarial Auditor of the Company for a period of 5 consecutive years, commencing from FY 2025-26 to FY 2029-30, at the Board meeting held on May 15, 2025, based on the recommendation of the Audit Committee of Directors, subject to the approval of the Members at the ensuing AGM of the Company. They will undertake secretarial audit as required and issue the necessary secretarial audit report for the aforesaid period in accordance with the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014 and amended Regulation 24A of the Listing Regulations. They have confirmed that their appointment complies with the eligibility criteria in terms of Listing Regulations. The resolution seeking Members approval for their appointment forms part of the Notice.

The Secretarial Audit Report confirms that the Company has complied with the provisions of the Act, Rules,

Regulations and Guidelines and that there were no deviations or non-compliances.

In pursuance of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board, on the recommendations of the Audit Committee, had appointed Companies Act, 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. Neeraj Gupta & Associates, Practicing Company Secretary was appointed to undertake the Secretarial Audit of the Company for the Financial Year ended 31^st March, 2025.

Secretarial Audit Report for the Financial Year ended on 31^st March, 2025, issued by M/s. Neeraj Gupta & Associates, Practicing Company Secretary, in Form MR-3 forms part of this report and marked as "Annexure-B".

The said report contains no qualification/observation requiring explanation or comments from Board under section

134(3)(f)(ii) of the Companies Act, 2013.

The Board of Directors of the Company in their meeting held on 15^th May,2025, on the recommendation of Audit Committee, re-appointed Mr. Neeraj Gupta & Associates, Practicing Company Secretary as Secretarial Auditors of the Company for the for further period of five (5) years subject to the shareholders meeting in the ensuing Annual

General Meeting.

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

During the year under review, the Statutory Auditors and Secretarial Auditor of your Company have not reported any instances of fraud committed in your Company by Companys officers or employees, to the Audit Committee, as required under Section 143(12) of the Act.

No significant and materials orders were passed by the regulators or courts or tribunals status of your Companys operations in the future. No application was made and no proceedings was pending against the Company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

The particulars of loans given, guarantees given and securities provided and investments made under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements.

The Provisions of constitution of Risk Management Committee has been made applicable by the SEBI has vide its Notification dated 5.5.2021 wherein it has made it mandatory for top 1000 listed entities on the basis of market capitalization as on close of previous financial year to have Risk Management Committee.

According the Company does not have Risk Management Committee as it is not applicable on your company and there is no risk which may threaten the existence of the Company as a going concern.

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Second

Amendment Rules, 2015 (As per notification dated 4th September, 2015), is annexed to this Report as "Annexure-C".

In terms of Section 134(3)(l) of the Companies Act, 2013, except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position which have occurred between the end of the financial year of the Company to which the financial statements relate and date of the report and there has been no change in the nature of business.

A report on Corporate Governance as stipulated by Regulation 34(3) of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 forms part of this Annual Report along with the required Certificate Auditors confirming compliance with the conditions of Corporate Governance.

As required under Regulation 34(2)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015, the Management Discussion and Analysis Report on the operations and financial position of the Company has been provided in a separate section which forms part of this Annual Report.

No requests were pending at the beginning of the financial year. During the year under review, no request was reported. No request was pending as at the end of the financial year.

Whistle Blower Policy and Vigil Mechanism

As already reported, the Board has, pursuant to the provisions of Company has in terms of the provisions of Section 177(9) & (10) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, formulated Whistle Blower Policy and Vigil Mechanism for Directors and employees under which protected disclosures can be made by a whistle blower and provide for adequate safeguards against victimization of Director(s) or employees(s) or any other person who avail the mechanism.

The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, integrity and ethical behavior.

The Vigil Mechanism – cum – Whistle Blower Policy may be accessed on the Companys website at the link: https://www.leatherchem.com/pdf/Vigil-Mechanism-Whistle-Blower-Policy.pdf.

Pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘POSH Act) and Rules made thereunder, the Company has formed an Internal Committee (‘IC) for its workplaces to address complaints pertaining to sexual harassment in accordance with the POSH Act. The Company has a detailed policy for prevention of sexual harassment at workplace which ensures a free and fair enquiry process with clear timelines for resolution.

The Policy is uploaded on the website of the Company at https://www.leatherchem.com/pdf/HLCL-POSH-Policy.pdf.

No complaints were pending at the beginning of the financial year. During reported. No complaint was pending as at the end of the financial year.

To build awareness in this area, the Company has been conducting awareness sessions during induction of new employees and also periodically for permanent employees, third-party employees and contract workmen through online modules and webinars.

The Internal Financial Controls, with reference to financial statements, as designed and implemented by the

Company are adequate. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for insufficiency or inadequacy of such controls.

The details pertaining to internal financial controls and their adequacy have been disclosed in the Management

Discussion & Analysis Report forming part of this Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES a) Statement showing details of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been provided in Annexure–D (I) which forms part of this Report. b) Information pertaining to remuneration to be disclosed by listed companies in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have been provided in Annexure–D(II) which forms part of this Report.

On behalf of the Directors of the Company, I would like to place on record our deep appreciation to our shareholders, customers, business partners, vendors, bankers, financial institutions and academic institutions for all the support rendered during the year.

The Directors are thankful to the Government of India, the various ministries of the State Governments, the Central and State electricity regulatory authorities, communities in the neighborhood of our operations, municipal authorities and local authorities in areas where we are operational in India; as also partners, governments and stakeholders in international geographies where the Company operates, for all the support rendered during the year.

Finally, we appreciate and value the contributions made by all our employees and their families for making the Company what it is.

INFORMATION AS PER SECTION 134(3) OF THE COMPANIES ACT 2013 READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES, 2014 AND FORMING PART OF THE DIRECTORS REPORT FOR THE YEAR ENDED 31st MARCH, 2025

Total energy consumption and energy consumption per unit of production as per Form A of the Annexure to this rule is as under:

For the year 24-25, the company undertook the following technology development work that helped ACRELON product ranges: Inhibitor control during storage of Acrylic Monomers: Due to the increase in production of acrylics to augment ACRELON range, the company needs to buy bulk lot of key monomers like Butyl Acrylate, Methyl Metha Acrylate and Acrylonitrile. This required monitoring of Inhibitor quantity during bulk storage. Especially in summer the inhibitor of these monomers shows a tendency to deplete - posing some safety challenges. This required highly advanced techniques in Gas chromatography and spectrophotometry to detect ppm level depletion and formation of peroxide. The company successfully completed Inhibitor detection and Control: (1) Tertiary Butylcatechol (TBC) in Styrene Monomer; (2) Topanol in Methyl Metha Acrylate and MEHQ in Butyl Acrylate. On receipt of the supply Inhibitor level is audited and its depletion rate during storage and need for replenishment has helped the company immensely to secure quality and safety during storage. Automation to control reactors: The Company needed to upgrade its current acrylic liquid production in terms of capacity and quality. Due to the incorporation of high-capacity reactors in ACRELON production lines, it was considered necessary to develop automated control loops relating to flow and temperature control during reactions that are exothermic. The company developed an internal concept on temperature control, feed control, safety interlocks etc. The concept was implemented by an Instrument vendor as per companys specifications and requirements. Various loops were successfully tested on a 5 KL reactor where the heating cooling cycle is automated, monomer feed pumps are interfaced using a PLC and HMI, cooling tower interlocking and alerts are incorporated as per the defined safety norms.

The improved inhibitor control contributed to the safety and stability of precious monomer raw materials that always were considered risky during summer because of a chance of undesired polymerization. The understanding of depletion rate and replenishment protocol of respective inhibitors improved the buying cycle resulting in direct financial benefits. The company was able to buy when prices were low - without fearing the storage risks. The availability at the plant site improved significantly ensuring uninterrupted production. The stabile level of inhibitors also eased of quality control as batch-to-batch variations were not hindering the production cycles of ACRELON series products. The research on Automation of reactors enabled the current production team to increase the ACRELON liquid production section that was suffering a capacity constraint. With the addition of 5 KL reactor and its automated loops, the existing production team were comfortably able to manage the demand without additional manpower. The automated loops helped de-skill the reactor operations, reduced quality variation immensely. The same concept also enabled the company to consider further capacity expansion using a 10 KL reactor that was relocated from Fatliquors section.

3. Future Plan of Action:

The year 25-26, the companyhasfinalizedits agenda for research and development. The company proposes focusing its research work on the following two areas that will yield long-term benefitsin sustainability goals and also product excellence.

(1) Biological processes to treat wastewater: Company currently uses a Physio -Chem and Fenton reaction cycle to treat its wastewater. Being a ZLD company, the wastewater is made reusable after passing through extensive treatment stages. However, this treatment cycle is long, requires excessive handling of sludge that needs to dispose at Government authorized facilities. The companys past efforts on waste - water minimization has also yielded significant reduction in wastewater quantity that making the current treatment cycle unstable for physio – chem treatment plan in isolation. The current plan has to be reinforced with a new technology which relies on biological breakdowns of organic matter. The company has developed a concept and will be installing a pilot plant for 1 KLD to add Anaerobic and aerobic wastewater treatment to the existing treatment cycle. The company hopes it will make the water infrastructure future- ready; de skill and semi automate the treatment cycle.

(2) Accelerated weather testing: The company wishes to evaluate for its key products the damage due to sunlight, rain, and dew. Since UV light is responsible for almost all photodegradation, therefore this research will reveal product weakness if any and will allow modifications in recipe to improve durability of product and reduce ageing effect. The study will focus on its PVC additives, especially Impact Modifier for window profiles and leather coating for white leather. The plan is to test the product degradation by exposing them to alternate cycles of Ultraviolet rays (UV 313 nm and 340 nm), moisture at elevated temperatures and condensation as per ASTM D 154. This cycle can simulate within days the same degradation that occurs over years and decades. The project would require import of some critical test equipment that allows the above test conditions

1. All previously imported technologies have been fully absorbed and commercialized.

2. The indigenously developed technologies of previous years have been absorbed and commercialized.

1. The Companys foreign exchange earnings from exports (including foreign exchange fluctuations) amounted to

Rs. 801.51 lacs.

2. Foreign exchange expenditure for the financial year is Rs.162.19 Lacs. This is related to payment towards raw materials, import of capital goods, payment of overseas travel of Directors & Employees.

Annexure–D (I) Information as required under Section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014: (I) % Increase in the Median Remuneration of the Employees (Rs. In Lakhs)

Non-Executive Directors are not being paid any remuneration except sitting fee

During the year, the average percentage increase in salary of the Companys employees excluding Key Managerial Personnel (KMP) was 10%.

Notes: Gross remuneration includes Salary, House Rent Allowance and other perks like Medical Reimbursement, Leave Travel Assistance, Companys contribution towards Provident Fund etc. but excludes Gratuity and Leave Encashment.

DECLARATION BY THE MANAGING DIRECTOR & CEO AS PER REGULATION 26(3) OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

I hereby confirm that the Members of Board of Directors and Senior Management Personnel have affirmed compliance with the Code of Conduct of Board of Directors and Senior Management, as approved by the Board, for the year ended 31st March, 2025.

For Haryana Leather Chemicals Limited Pankaj Jain Place: Gurugram Managing Director Place: 15^th May,2025 DIN: 00206564