Jocil Ltd Directors Report

Your Directors have pleasure in presenting the Forty Seventh Annual Report on the Business and Operations of the Company together with the Audited Financial Statements for the Financial Year ended 31^st March 2025.

(? in Lakhs)

1. FINANCIAL RESULTS	2024-25	2023-24
Sales	86336.31	75091.90
Processing charges	217.89	227.69
Other income	195.09	396.10
Total income	86749.29	75715.69
Profit for the year before interest and depreciation	703.01	876.77
Interest	(1.87)	(1.92)
Depreciation	(567.08)	(610.20)
Profit before tax	134.06	264.65
Less: Provision for current tax	90.00	140.00
Deferred tax-(credit)	(62.34)	(58.20)
Short provision of income tax in earlier years	4.40	10.12
Profit after tax	102.00	172.73

The turnover of the company for the year at 863.36 crores increased by 14.97% from 750.92 crores of the previous year. During the year, the sales volume of Fatty acids decreased by 12.34% and Toilet Soap & Soap products increased by 18.92%. The Profit Before Tax (PBT) decreased to 1.34 crores as compared to 2.65 crores in the previous year. The main reason for decrease in PBT is decrease in sales volume of Fatty Acids due to severe competition and also due to decrease in other income.

The appropriations from the profit are as detailed below.

( in Lakhs)

	2024-25	2023-24
Profit after tax (including other comprehensive income)	(316.55)	640.22
Balance brought forward from previous year	6646.36	6228.17
Profit for appropriations	6329.81	6868.39
APPROPRIATIONS
Dividend (accounted in the year of payment)*	133.22	222.03

* In accordance with the requirements of Ind AS, dividend is to be accounted in the year of payment. Hence, dividend paid during the year is given instead of dividend declared during the year.

Balance carried forward	6196.59	6646.36
TOTAL	6329.81	6868.39
Authorized capital	1000.00	1000.00
Paid-up capital	888.16	888.16
Reserves & surplus	19719.99	20169.77

2. DIVIDEND & RESERVES

Considering the profits of the Company the Board of Directors have recommend for the approval of the shareholders of the Company for payment of dividend for the year ended 31-03-2025, at 0.50 per equity share of 10 each, which aggregates to 44,40,575 on 88,81,150 equity shares of the Company. In the previous year, the Company paid dividend at 1.50 perequity share of 10 each on 88,81,150 shares amounting to 1,33,21,725. Your Directors do not propose to transfer any amount to reserves for the Financial Year ended on March 31, 2025.

3. OPERATIONS	2024-25	2023-24
	MT	MT
Production
(including processed on jobwork)
a. Fatty acids	70047	74945
b. Toilet soap & Soap products	41673	37087
c. Biomass power-kwh	25297547	27239959
d. Wind power-kwh	11571819	9596206
By-products:
a. Glycerine	1743	2457
b. Fatty acid pitch	2499	2722
Sales
a. Fatty acids	48435	55255
b. Toilet soap & Soap products	37875	31849
c. Biomass power-kwh	5302026	4865214
d. Wind power-kwh	11571819	9516050
By-products:
a. Glycerine	747	1713
b. Fatty acid pitch	2596	2737

4. BUSINESS REVIEW AND OUTLOOK

Your Company has not changed its nature of business during the period under review. Division wise performance and outlook is described as given below.

Fatty Acids and Soap

There is an improvement in sales volume of Soap Noodles. However, the profitability of the year under review is lower when compared to previous year due to the reasons afore stated. GST refund/benefit is continuing for North-eastern states and Jammu & Kashmir and will be available upto June 30, 2027. However, these benefits may not be attractive enough to overcome the increased logistical costs for marketing in the south. As a result, the opportunities have improved for manufacturers in non-exempt areas especially for those catering to the Southern markets. However, due to intense competition, the Company is able to market short of its full capacity and that too with meagre margins. Also, in order to survive in the competing business for Stearic Acid, Company reduced the prices of various grades of Stearic Acid. The Company is continuing to explore the market for its products from medium to small customers with reasonable success.

Cost of raw materials is a major component in total cost of production and the fluctuation in their prices is a serious cause of concern to the company particularly when the customers demand long term forward contracts while the same is not possible with the raw material suppliers. There is stiff competition from manufacturers particularly from those having backward integration which gives them a cost advantage. The Company is able to source the raw materials largely from local suppliers. However, to meet the urgent requirements of major customers, Company may have to import PFAD and RBD Palm Stearine in case of shortage in local market.

The Company enters into contracts for supply of Fatty Acids, Soap Noodles and Toilet Soap for major customers wherein the price of raw materials is factored into the selling price of the products. The customers themselves supply/cover raw materials required for the total process and the Company receives processing charges for the manufacture of final products. This system provides meagre margins but helps to safeguard against fluctuations in raw material prices and thereby avoids losses.

M/s. Hindustan Unilever Ltd, one of Companys major customer expressed its interest to procure additional quantity of Soap Noodles. As such Company increased the capacity of Soap Noodles production by 1500 MT per month by investing an amount of Rs.6.5 Crores. Commercial production of the expanded capacity commenced from 15 May 2025. The market for Toilet Soap and Soap Noodles is expected to increase compared to the year under review due to increase in capacity of Soap Noodles Plant. For Stearic Acid there may be a slight increase in demand in the forth coming period due to offering of competitive prices to customers.

Biomass Power Plant

The generation from the Plant during the year decreased to 253 lakh units from 272 lakh units achieved in the previous year, a 7% drop when compared to the previous year. However, sale of Biomass Power

improved to 53 lakh units a 9% rise when compared to the previous year. The main reason for increase in sales is due to sale of additional units of Power to Indian Energy Exchange (IEX) when compared to the previous year due to decrease in internal consumption.The revenue from Biomass Power Plant is expected to decrease slightly compared to the year under review due to additional requirement of Power for internal consumption for the anticipated higher production of Fatty Acids and Soap Noodles.

Wind Energy Generators (WEG)

Power generation during the year from the four Wind Energy Generators (WEGs) of 6.3 MW capacity has increased as compared to the previous year. During the year, the power generation from all the four WEGs was 115.72 lakh units as compared to 95.96 lakh units in the previous year due to decrease of grid failure from13.12% to 4.67%. The backdown of WEGs for want of evacuation facilities amounts to 3.14% of available time during the year 2024-25 as compared to 4.26%in the previous year.

5. SUBSIDIARY/ASSOCIATE COMPANIES

Your Company has no subsidiary/associate/joint venture companies. During the year under review, your company has not added any subsidiaries, joint ventures or associate companies.

6. FINANCE AND STATUTORY COMPLIANCES

The Company availed working capital facilities under consortium arrangement with Union Bank of India and State Bank of India and the accounts are in order. The company complied with all the legal requirements and there are no outstanding statutory dues as on 31st March 2025.

During the year there have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

7. CREDITRATING

During the year the Credit Rating Agency CARE re-affirmed the credit rating for working capital facilities as detailed hereunder.

Nature of Facilities	Rating Assigned
	2024-25	2023-24
i. Long term facilities	CARE A-; Stable (adequate degree of safety regarding timely servicing of financial obligations)	CARE A -, Stable (adequate degree of safety regarding timely servicing of financial obligations)
ii. Short term facilities	CAREA2+ (Strong degree of safety regarding timely payment of financial obligations)	CAREA2+ (Strong degree of safety regarding timely payment of financial obligations)

8. DEPOSITS

Your Company has not accepted any deposits covered under Chapter V of the Companies Act, 2013 i.e. within the meaning of Section 2(31) of the Companies Act, 2013 read with Rule 2(1)(c) of the Companies (Acceptance of Deposits) Rules, 2014 and as such there are no such overdue deposits outstanding as on 31 March 2025.

9. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF REPORT.

There are no material changes and commitments affecting financial position of the Company, which occurred after the end of the financial year i.e. 31 March 2025.

10. DISCLOSURE UNDER THE SEXUAL HARASSMENT 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 the Workplace (Prevention, Prohibition & Redressal) Act 2013. All women employees whether permanent, temporary or contractual are covered under the said policy. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year the Company has not received any complaints on sexual harassment of women at the workplace.

11. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has established Vigil Mechanism as required under Section 177 of the Companies Act, 2013 for directors and employees to report genuine concerns as prescribed in the policy. The policy provides adequate safeguards against victimization of persons who use such mechanism and makes provision for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases.

12. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

In accordance with the provisions of the Companies Act 2013 and Articles of Association of the Company, Sri Mullapudi Thimmaraja and Sri Mullapudi Mrutyumjaya Prasad, Directors retire by rotation at the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. Sri K. Rama Seshyya was re-appointed as Non-Executive Independent Director, by the shareholders by way of a Special Resolution at their Annual General Meeting held on September 19, 2024 for the second term of 5 consecutive years from 21-9-2024 up to 20-9-2029 after completion of his first term of appointment on September 20, 2024.

a. In the opinion of the Board, Independent Directors appointed during the year possess the requisite integrity, expertise and experience (including proficiency),

b. During the year under review, none of the Directors resigned from the Board.

c. The Company held Four Board Meetings during the year. Board Meeting dates and attendance particulars are available in the report on Corporate Governance.

d. The Company has received declarations from all Independent Directors confirming that he/she meets the criteria of independence as provided under sub-section 6 of Sec.149 of the Companies Act, 2013 at the first meeting of the Board in which he/she participated as a Director and there after at the first meeting of the Board in every financial year or whenever there is any change in the circumstances that may affect his/her status as an Independent Director.

e. The Audit Committee as on 31 March 2025 consisted of 6 Non-Executive Directors of which 4 are Independent Directors. Sri PA. Chowdary, Independent Director is the Chairman of the Audit Committee. The remaining 5 members are Sri Mullapudi Thimmaraja, Non-Executive Director, Sri VS. Raju, Non-Executive Director, Sri P Kesavulu Reddy, Independent Director, Sri G.S.V Prasad, Independent Director and Dr. VN. Rao, Independent Director. The Board accepted all the recommendations of the Audit Committee during the year.

During the year under review, the Company is having the following persons as Key Managerial Personnel under Sec.203 of the Companies Act, 2013.

Name of the Official	DIN / Membership No.	Designation
Sri J. Murali Mohan	00114341	Managing Director
Sri K. Raghuram	FCS - 6712	Secretary & Dy. General Manager (Fin.) (CFO)

13. MEETING OF INDEPENDENT DIRECTORS

A separate meeting of Independent Directors as required under Schedule IV of the Companies Act, 2013 was held on 5 February 2025, without the presence of Non-Independent Directors. This meeting was conducted to review and evaluate (a) the performance of Non-Independent Directors and the Board as a whole, (b) the performance of the Chairperson of the company, taking into account the views of Executive Directors and Non-Executive Directors and (c) assess the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties. The Independent Directors expressed their satisfaction with the performance of Non-Independent Directors and the Board as a whole and Lead Independent Director Sri P Kesavulu Reddy briefed the outcome of the meeting to the Board.

14. INTEGRITY, EXPERTISE AND EXPERIENCE OF THE INDEPENDENT DIRECTORS

All the Independent Directors appointed by your Company are selected from the Independent Directors Data bank maintained by the Indian Institute of Corporate Affairs (IICA). All Independent Directors of the Company have passed/been exempted from the online Proficiency Self Assessment Test conducted by IICA.

All the Independent Directors of the Company have given their respective declarations/disclosures under Section 149(7) of the Companies Act, 2013 and Regulation 25(8) of the Listing Regulations and have confirmed that they fulfill the independence criteria as specified under Section 149(6) of the Act

and Regulation 16 of the Listing Regulations and have also confirmed 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. Further, the Board after taking these declarations/disclosures on record and acknowledging the veracity of the same, concluded that the Independent Directors are persons of integrity and possess the relevant expertise and experience to qualify as Independent Directors of the Company and are Independent of the Management.

15. AUDITORS

M/s. Chevuturi Associates, Chartered Accountants, Vijayawada were appointed as Auditors for a period of 5 years at the 44th Annual General Meeting held on 24 September 2022 till the year 2026-27. There are no qualifications, reservations or adverse remarks in the audit report issued by them for the financial year ended 31st March 2025.

16. COST RECORDS AND COST AUDITORS

Company is maintaining cost records as specified by the Central Government under sub section (1) of Section 148 of the Companies Act, 2013. M/s. Narasimha Murthy & Co., Cost Accountants, Hyderabad are conducting the cost audit for applicable products during the year. They are eligible for re-appointment as Cost Auditors for the year 2025-26. Cost Audit for the Financial Year 2024-25 is expected be completed before the due date i.e., 30 September 2025. There are no qualifications, reservations or adverse remarks in the audit report issued by them for the financial year ended 31st March 2024.

17. SECRETARIAL AUDIT

M/s. Nekkanti S.R.VVS. Narayana & Co., Company Secretaries, Hyderabad were appointed as Auditors for secretarial audit for the year 2024-25 under Section 204 of the Companies Act, 2013 and they have submitted their report. There are no qualifications, reservations or adverse remarks in the audit report issued by them for the financial year ended 31st March 2025.

18. ANNUAL RETURN

Pursuant to Section 92(3) of the Companies Act, 2013, Annual Return has been placed in the website of the Company and weblink for the same is www.//jocil.in/AnnualReturn2024-25.pdf

19. DECLARATION AS PER SECTION 134 (3)(ca) OF COMPANIES ACT, 2013

During the year, the auditors have not reported any instance of frauds committed by or against the Company by its Directors/Officers/Employees to the Audit Committee or Board under Section143(12) of the Companies Act, 2013 and rules made there under. Therefore no details are required to be disclosed under Section 134(3)(ca) of the Act.

20. SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS

There were no significant material orders passed by any Regulators/Courts/Tribunals that would impact the going concern status of the Company and its future operations.

Your company has complied with all the Acts, Rules, Regulations and Guidelines issued/prescribed by the Securities Exchange Board of India, Reserve Bank of India, Ministry of Corporate Affairs and other statutory authorities.

21. No application has been made under the Insolvency and Bankruptcy Code. As such the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable.

22. The requirement to disclose the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons there of, is not applicable as no such loans were obtained from any Banks or Financial Institutions.

23. INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY

Your Company has adequate Internal Financial Controls as per Section 134(5)(e) of the Companies Act, 2013 that commensurate with the size of the business and nature of its operations, designed to provide reasonable assurance with regard to the accuracy and completeness of the accounting records and timely preparation and provision of reliable financial statements.

The Board has inter alia reviewed the adequacy and effectiveness of the Companys internal financial controls relating to its financial statements, the major financial risk exposures if any and steps taken by the management to monitor and control such exposures, overseen and reviewed the functioning of the Whistle Blower Mechanism.

Your Company has adopted necessary policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of financial information.

During the year no fraud by the Company or with the Company by its officers or employees has been noticed/reported.

24. COMPLIANCE WITH SECRETARIAL STANDARDS

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

25. The information required to be included in the Board of Directors Report under the Companies Act, 2013 and Rules made there under is annexed and forms part of this report, details of which are as follows.

Sl Particulars No.	Section	Rule	Annexure No.
1 Company policy on Directors appointment and remuneration etc. provided under sub-sections (3) and (4) of Section 178	134 (3) (e)		1
2 Particulars of loans, guarantees or investments under Section 186	134 (3) (g)		2
3 Particulars of contracts or arrangements with related parties referred to in sub-section (1) of Section 188 in Form AOC -2. Companies (Accounts) Rules, 2014	134 (3) (h)	8(2)	3
4 Conservation of energy, technology absorption and Foreign Exchange earnings and outgo. Companies (Accounts) Rules, 2014	134 (3) (m)	8 (3) (A), (B) & (C)	4
5 Risk management policy for the company including identification therein of elements of risk if any.	134 (3) (n)		5
6 Corporate Social Responsibility Policy and initiatives taken during the year. Companies (Corporate Social Responsibility Policy) Rules, 2014	134 (3) (o)	8 (1)	6
7 Statement indicating the manner in which formal annual evaluation of the performance of the Board, its committees and Individual Directors have been made. Companies (Accounts) Rules, 2014	134 (3) (p)	8 (4)	7
8 Financial summary or highlights. Companies (Accounts) Rules, 2014	134 (3) (q)	8 (5) (i)	8
9 Ratio of the remuneration of each Director to the median employees remuneration and such other details. Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014	197 (12)	5 (1)	9
10 Particulars of employees in receipt of remuneration not less than Rs. 8,50,000 per month or Rs. 1,02,00,000 per year etc. Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014	197 (12)	5 (2)	10
11 Secretarial Audit Report in Form MR-3. Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014	204 (1)	9 (1)	11

24. INFORMATION UNDER LISTING REGULATIONS

The Company is committed to maintain the standards of Corporate Governance prescribed under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (Listing Regulations). The information required to be included in the Annual Report under Schedule V of the Listing Regulations are as follows.

Sl.No. Particulars	Para	Annexure No.
1 Management Discussion and Analysis Report	A	12
2 Report on Corporate Governance	B	13
3. Related Party Disclosures	C	14
4. Disclosures with respect to Demat Suspense Account / Unclaimed Suspense Account	D	15
5 Declaration by the Managing Director that all Board Members and Senior Management Personnel affirmed their compliance with the Code of Conduct.	E	16
6 Compliance Certificate from Auditors on Corporate Governance	F	17

The Company is having a policy to deal with Related Party Transactions and the same may be viewed in the Companys website www.jocil.in. Accounts for disclosures in compliance with the Accounting Standards on "Related Party Disclosures" are given in note no. 34.

25. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to

Directors Responsibility Statement, it is hereby confirmed that -

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

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

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

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

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

Explanation : For the purpose of this clause, the term "internal financial controls" means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.

f. and, 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.

26. PERSONNEL

The Directors wish to place on record their appreciation to all the employees of the Company for their sustained efforts and valuable contribution to the performance of the Company during the year.

27. ACKNOWLEDGEMENTS

The Directors wish to place on record their appreciation for the wholehearted and sincere cooperation the Company received from various departments of Central and State Governments, Bankers, Auditors, Dealers and Suppliers of the Company. The Directors also would like to express their grateful appreciation for the guidance and cooperation received from the Holding Company, M/s. The Andhra Sugars Limited, Tanuku.

Place	Dokiparru	For and on behalf of the Board of Directors PI NARENDRANATH CHOWDARY
Date	:26 May 2025	Chairman