Kiri Industries Ltd Directors Report.

To,

The Members

Kiri Industries Limited

Your Board of Directors are pleased to present the 22nd Annual Report together with Audited Financial Statements of the Company for the Financial Year ended on March 31, 2020.

Standalone Performance

(INR in Crore)

Particulars 2019-20 2018-19
Total Revenue 973.18 1064.69
Operational Expenses 872.89 905.45
Earning Before Finance Cost, Depreciation and Tax (EBIDTA) 100.29 159.24
Less: Finance Cost 4.52 4.39
Depreciation 36.63 28.49
Earning Before Taxation 59.14 126.34
Less: Current Tax 10.21 28.00
Deferred Tax (1.24) (21.70)
Other Comprehensive Income (0.36) (0.21)
Earnings After Tax (EAT) 49.82 119.83

Highlights of Standalone Operations

During the year under review, the Company has reported a total revenue of INR 973.18 Crore as compared to INR 1064.69 Crore in FY 2018-19, down by 8.59%. The revenue has been down on account of closure of plants due to lockdown and decrease in average price realization by 11% of the products as compared to FY 2019-20. EBIDTA reported INR 100.29 crore as against INR 159.24 crore in FY 2018-19. Operational expenses of INR 872.89 Crore include a significant amount of Legal & Professional fees related to the Singapore court cases.

During the year, the finance cost is increased from INR 4.39 Crore to INR 4.52 Crore due to increase in finance charges pertaining to discounting of letter of credits and other bank charges. Similarly depreciation has been increased from INR 28.49 Crore to INR 36.63 Crore mainly on account of commencement of Thionyl Chloride Plant, Zero liquid discharge facility and disperse dyes plant during the current financial year.

The Company has reported earnings after tax of INR 49.82 Crore as against INR 119.83 crore of FY 2018-19, which is decreased mainly on account of decrease in prices of products, increase in operational expenses and depreciation.

Highlights of Consolidated Performance

(INR in Crore)

Particulars FY 2019-20 FY 2018-19
Total Revenue 1310.68 1396.50
Operational Expenses 1119.33 1162.80
Earnings before Interest, Depreciation and Tax (EBIDTA) 191.35 233.70
Less: Finance cost 4.84 5.08
Depreciation 44.40 37.56
Earnings Before Tax 142.11 191.06
Taxes 26.41 33.43
Other Comprehensive Income (0.52) (0.21)
Earnings After Tax (Before Share of Profit of Associates) 115.18 157.42
Share of Profit of Associates 259.81 6.49
Earnings After Tax (EAT) 374.99 163.91

Highlights of Consolidated Operations

During the year under review, total revenue of the Company has been reduced by 6.15% from INR 1396.50 Crore to INR 1310.68 Crore due to closure of manufacturing units on account of lockdowns in later part of March 2020 and decrease in prices of products and Earnings before Interest, Depreciation and Tax (EBIDTA) has been reduced by 18.12% during FY2019-20 from INR 233.70 Crores to INR 191.35 crore.

During the year, earnings after tax (including share of profit of associates) has been increased from INR 163.91 Crore in FY 2018-19 to INR 374.99 Crore in FY 2019-20, which is sharply increased by 128.78% on account of adding back of wrongful write-down/ exceptional provisions and expenses claimed in DyStar. In consolidated earnings after tax Lonsen Kiri contributed to INR 67.19 crore.

Impact of COVID-19:

The Covid-19 pandemic is spreading very fast across the globe and an unprecedented impact on people and economies worldwide.

The Ministry of Home Affairs, Government of India on March 24, 2020 notified the first ever nationwide lockdown in India to contain the outbreak of Covid-19. The management have assessed the impact of Covid-19 on the business at the balance sheet date and there are no significant impact as of the balance sheet date because manufacturing facilities as well as offices of the Company were closed from March 25, 2020. The manufacturing facilities resumed its operation in phase manner from April 27, 2020 to fulfill export orders on account of relaxations given by the Government. Due to the worldwide uncertainty caused by Covid-19 and its potential impact, the company has put in place mitigation plans to minimize the adverse impact on both revenue and profitability. However at this juncture it is difficult to assess the overall impact on the economy and business operation of the Company. There are no material changes or commitments affecting the financial position of the Company between the end of the financial year and the date of this report.

The Company has taken various initiatives towards medical and community support to fight against Covid-19 pandemic. Your Company has distributed hand sanitizer, mask, food to the community during the locked down. In COVID -19 Pandemic, the Company has recognised the employees position and has given all necessary support in financial and in other means. Your Company undertook timely and essential measures to ensure the safety and well-being of all its employees at all its plant locations and offices. The Company has observed all the government advisories and guidelines thoroughly.

Dividend

• Dividend on Equity Shares:

Due to impact of Covid-19 on business operations of the Company, the board has recommended a final dividend of INR 0.50/- (@ 5%) per Equity Share of INR 10/- each for the financial year ended on March 31, 2020 subject to approval of shareholders at 22nd Annual General Meeting, which would involve total cash outflow of INR 1.68 Crore including deduction of Tax at source (TDS). The Dividend payout is as per Dividend Distribution Policy, which is available on the website of the Company i.e. www.kiriindustries.com.

• Dividend on Cumulative Redeemable Preference Shares

Your Directors have recommended dividend of INR 0.015/- (@ 0.15%) per share on 43,33,500 Cumulative Redeemable Preference Shares (Preference Shares) of INR 10.00 each for the year ended March 31, 2020.

Accordingly, Your Company shall make the payment of dividend after deduction of Tax at source (TDS). The total cash outflow of dividend would amount to INR 65002.50/- including deduction of Tax at source (TDS).

In view of Changes made in Income Tax Act, 1961, by the Finance Act, 2020, dividend paid or distributed will be taxable in the hand of Shareholders of the Company.

Investor Education and Protection Fund (IEPF)

Pursuant to the provision of Section 124 and 125 of the Companies Act, 2013 ("Act") read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), any money transferred to Unpaid Dividend Account and which remains unpaid or unclaimed for seven consecutive years from the date of such transfer shall be transferred by the Company into IEPF account, established by Government of India. Further, the company shall also transfer shares of Members whose dividends remain unpaid/unclaimed for a continuous period of seven years to the demat account of IEPF Authority. During the year, there were no funds/shares, which were required to be transferred to IEPF Authority.

Further, an amount of INR 3,00,696/-, which remained under unpaid and unclaimed Dividend account for FY 2018-19 will be due for transfer to IEPF account on October 27, 2026, if remained unclaimed for seven consecutive years.

The Company has appointed a Nodal Officer as per IEPF Rules, the details of which are available on the website of the Company i.e. www.kiriindustries.com.

Subsidiaries and Consolidated Financial Statements

The Company has prepared Consolidated Financial Statements in accordance with the Indian Accounting Standards (Ind AS) and as per Schedule III to the Companies Act, 2013. Except where otherwise stated, the accounting policies are consistently applied.

The Board has reviewed the affairs of the Companys subsidiaries during the year at regular intervals. In accordance with section 129(3) of the Companies Act, 2013, the Company has prepared Consolidated Financial Statements of the Company and its subsidiary/Associates and Joint

Venture, which forms part of this Annual Report. A statement containing salient features of the financial statements of the subsidiary companies/Joint Ventures/Associates in Form AOC-1 is provided as "Annexure A" to this report. During the year under review, there were no Companies which have become or ceased to become subsidiary, associate or joint venture of your Company.

In accordance with third proviso to Section 136 of the Act, the Annual Report of your Company, contains inter alia the audited Standalone and Consolidated Financial Statements.

Your Company has also implemented Policy for determining Material Subsidiary as per the requirements under regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"). The said policy is available on the website of the Company i.e. www.kiriindustries.com.

Directors and Key managerial Personnel

During the year under review, based on recommendation of Nomination and Remuneration Committee, the board of directors have appointed Mr. Ulrich Hambrecht (DIN: 01967154) as an Independent Additional Director on board with effect from November 12, 2019 who holds the office upto the date of upcoming 22nd AGM. The Board is of opinion that Mr. Ulrich Hambrecht possesses requisite qualification, experience and expertise and hold high standards of integrity and being eligible, offered himself to be appointed as an Independent Director of the Company for a term of 5 (Five) consecutive years.

Ms. Veena Padia (DIN: 06992591) who was appointed as Independent Director at the 17th Annual General Meeting of the Company held on September 26, 2015 and she holds office upto September 25, 2020. She is eligible and offered herself to be reappointed as an Independent Director for second term of 5 (Five) consecutive years. Based on recommendation of Nomination and Remuneration Committee and on performance evaluation, it is proposed to reappoint Ms. Veena Padia as an Independent Director on board for a second term of 5 consecutive years.

As per provision of the Section 152(6) of the Act, Mr. Pravin Kiri (DIN: 00198275), Chairman, Whole-Time Director (DIN- 00198275), retires by rotation at the ensuing AGM and, being eligible, offers himself for re-appointment.

Auditors

• Statutory Auditors

M/s. Pramodkumar Dad & Associates, Chartered Accountants, were appointed as Statutory Auditors of the Company at the 19th Annual General Meeting of the Company for a term of 5 (Five) consecutive years and they shall hold the office upto 24th Annual General Meeting of the Company to be held in year 2022. They have confirmed that they are not disqualified for continuing as Auditors of the Company.

The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation, adverse remark or disclaimer.

• Cost Auditors

M/s. V. H. Savaliya & Associates, Cost Accountants, Ahmedabad were appointed as Cost Auditors of the Company by the Board of Directors at their meeting held on August 12, 2019 for the Financial Year 2019-20.

Your Company has maintained the cost records as prescribed under Section 148 of the Companies Act, 2013 and rules made there under.

The Cost Audit Report for the financial year 201920, issued by M/s. V. H. Savaliya & Associates, Cost Accountants does not contain any qualification, reservation, adverse remark or disclaimer.

• Secretarial Auditors

M/s Kashyap R. Mehta & Associates, Practicing Company Secretaries, Ahmedabad, were appointed as Secretarial Auditors of the Company by the Board, at their meeting held on August 12, 2019 for financial year 2019-20. The secretarial audit report in the prescribed form MR-3 is attached herewith as "Annexure B".

Certain remarks in the Secretarial Audit Report do not have material impact on financial performance of the Company. The views of the Management on each such remark are given hereunder:

1. Ownership of an agricultural land intended for industrial purpose will be transferred in the name of the company upon receiving necessary approval for conversion into non agriculture land.

The land is acquired for future expansion of the Company. Since a Company cannot hold agriculture land, it is initially acquired in the name of Chairman of the Company, and the same would be transferred in the name of the Company after its conversion into non-agriculture land.

2. As per Reg.17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, number of Board of Directors is less than 6 for the quarter ended on 30th June, 2019 & 30th September, 2019 and for part of the quarter ended 31st December, 2019. However, the Company has appointed Independent Director on the Board of the Company w.e.f. 12th November, 2019. The Board of the Company is now duly constituted.

The Company has already appointed Mr. Ulrich Hambrecht as an Independent Additional Director on the board of the company w.e.f. November 12, 2019. During the period of delay in compliance of regulation 17 of Listing Regulations, the board was in process of identifying a suitable candidate on the board, who have required capability, expertise and experience in the chemical Sector to gain advantage of his knowledge and expertise to the company and its stakeholders. Further, the company has also paid penalty for delay in compliance of the said regulations to both the exchanges.

Declaration by Independent Directors and statement on compliance of Code of Conduct

During the year under review, all Independent Directors have given their declarations stating that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) Listing Regulations and have also complied the Code for Independent Directors as prescribed in Schedule IV to the Companies Act, 2013. In opinion of the Board, they fulfill the conditions of independence as specified in the Companies Act, 2013 and Rules made thereunder and Listing Regulations.

In terms of provisions of Listing Regulations, the Board of Directors of the Company have laid down a Code of Conduct ("Code") for all Board Members and Senior Management Personnel of the Company. The Board Members and senior management personnel of the Company have affirmed compliance with the Code. The Managing Director of the Company has given a declaration to the Company that all Board Members and senior management personnel of the Company have affirmed compliance with the Code. Code of Conduct for Directors and senior management personnel is available on the website of the Company at www.kiriindustries.com.

Meetings of the Board, Committees & Compliance to Secretarial Standards

During the year under review, 4 (Four) Meetings of Board of Directors were held as per details given below:

Date of Board Meeting

1. May 29, 2019

2. August 12, 2019

3. November 12, 2019

4. February 12, 2020

Pursuant to the requirements of Schedule IV to the Companies Act, 2013 and Listing Regulations, a separate Meeting of the Independent Directors of the Company was held on February 12, 2020.

Details of Composition and meetings of various committees held during the year are provided in Corporate Governance Report, which is forming part of this report.

During the year under the review, the Company has complied with the provisions of Secretarial Standard 1 (relating to meeting of the Board of Directors) and Secretarial Standard 2 (relating to General Meetings).

Listing Fees

The Equity Shares of your Company are listed and actively traded on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company had paid Annual Listing fees to both the stock exchanges for the Financial Year 2020-21 within the stipulated time.

Changes in Capital Structure

During the year under review, the Board of Directors of the Company at their meeting held on August 12, 2019 allotted 22,76,695 Equity Shares of INR 10/- each to LTS Investment Funds Ltd., upon conversion of Foreign Currency Convertible Bonds (FCCBs). Therefore, issued, subscribed and paid up Equity Share Capital of the Company is increased from INR 31.34 Crore to INR 33.62 Crore.

Employee Stock Option Scheme

In order to motivate, incentivize and reward employees, your Company has instituted employee stock options plan. The Board of Directors and Nomination and Remuneration Committee administers this plan. The stock option plan is in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("Employee

Benefits Regulations") and there have been no material changes to this plan during the financial year. Disclosures on ESOP plan, details of options granted, shares transferred to employee through Kiri Employee Stock Option Trust ("ESOP Trust") upon exercise, etc. as required under the Employee Benefits Regulations read with Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Companys website at www.kiriindustries.com.

During the year under review, eligible employees have exercised their 2,00,000 options granted and vested to them and ESOP trust have transferred equal number of equity shares to respective employees. At the end of financial year, total 2,25,000 options are outstanding. As per terms of scheme, no employee was issued stock option equal to or exceeding 1% of the issued capital of the Company at the time of grant. Kiri Employee Stock Option Trust is an ESOP Trust set up by your Company pursuant to approval by the shareholders at the 16th Annual General Meeting held on 26th September, 2014. The ESOP Trust is authorized to transfer shares from the Trust account to employees on exercise of vested options.

Board Evaluation

The Nomination and Remuneration Committee and the Board had laid down the process and criteria for annual performance evaluation of the Board, its Committees and individual directors. The Board of Directors have carried out an evaluation of its own performance, its Committees and that of its individual directors in compliance with the provisions of the Act and Listing Regulations.

The evaluation process covered aspects such as Board structure and composition, frequency of Board Meetings, participation in the long term strategic planning, contribution to and monitoring of corporate governance practices and the fulfilment of Directors obligation and fiduciary responsibilities, including but not limited to active participation at the Board and Committee meetings. The Board has reviewed the performance of the Board as a whole, its Committees and individual directors taking into account feedback of the Nomination and Remuneration Committee and the Independent Directors which includes the evaluation of the Chairman and Non- Independent Directors of the Company.

Remuneration of Directors and Employees:

A Statement pursuant to section 197 of the Companies Act, 2013 read with Rule 5 of Companies (Appointment & remuneration of Managerial Personnel) Rules, 2014 is attached as "Annexure C".

Policy on Directors Appointment and Remuneration

The Companys policy on directors appointment and remuneration and other matter as provided in Section 178(3) of the Companies Act, 2013 has been disclosed in the Corporate Governance Report, which is a part of this report and is also available on website of the Company i.e. www.kiriindustries.com.

Familiarisation Programme for Directors

The Company believes that a Board, which is adequately informed/familiarised with the Company and its affairs can contribute significantly to effectively discharge its fiduciary duty as director of the company and that fulfils stakeholders aspirations and societal expectations. In this regard, the Directors of the Company are updated on changes/ developments in the domestic/global industry scenario in the sector which affect the business of the Company, to enable them to take well informed and timely decisions. The details of familiarization programmes have been disclosed on the Companys website i.e. www.kiriindustries.com.

Directors Responsibility Statement

Pursuant to the provisions of Section 134 (5) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:

a) in the preparation of the annual accounts for the year ended March 31, 2020, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

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 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 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 for the year ended March 31, 2020 on a ‘going concern basis;

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

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

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors and external consultants, including the 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 FY 2019-20.

Business Responsibility Report (BRR)

Pursuant to regulation 34 of the Listing Regulations, the Annual Report of top 1,000 listed entities based on market capitalization shall have to prepare business responsibility report (BRR). Accordingly, BRR is annexed to this report as "Annexure D".

Internal Control Systems and their Adequacy

The Company has an Internal Control System, commensurate with the size and nature of its business operations. The Company has appointed an external audit firm for internal audit of the Company. The Internal Auditor reviews the adequacy of internal control system in the Company and its compliance with operating systems and policies & procedures. Based on the report of internal auditor, the account department undertakes corrective actions in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee on quarterly basis.

The details in respect of internal financial control and their adequacy are also included in the Management Discussion and Analysis Report, which is a part of this report.

Deposits from public

During the year under review, the Company has not accepted any deposits from public within the meaning of Section 73 to 76 of Companies Act, 2013 read with the Companies (Acceptance of Deposits by Companies) Rules, 2014 or any other applicable provision(s), if any.

Details of Loans, Investments and Guarantees

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the note no. 3 and 4 to the Standalone Financial Statements of the Company for the year ended March 31, 2020.

Related Party Transactions

During the year under review, all related party transactions are entered on arms length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013 and the Listing Regulations. There are no materially significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc. which may have potential conflict with the interest of the Company or which requires the approval of the shareholders. Since all related party transactions entered into by the Company were in ordinary course of business and were on arms length basis, Form AOC-2 is not applicable to the Company. The details of the transactions with Related Party are provided in the note no. 43 to standalone audited financial statements in accordance with the Accounting Standards.

All Related Party Transactions are placed before the Audit Committee and the Board on quarterly basis. Omnibus approval of audit committee and board are obtained for the transactions which are forecasted and are repetitive in nature. An abridged policy on related party transactions is available on the website of the Company i.e. www.kiriindustries.com.

Conservation of energy, research and development, technology absorptions and foreign exchange earnings and outgo

The relevant information on conservation of energy, technology absorption, foreign exchange earnings & outgo as required to be disclosed in term of Section 134(3)(m) of the Companies Act, 2013 together with the Companies (Accounts of Companies) Rules, 2014 is annexed to this report as "Annexure E".

Risk Management

The Company has a Risk Management framework in place to identify, assess, monitor and mitigate various risks to the business. This framework seeks to minimize adverse impact on the business objectives and enhance the Companys competitive advantage. The framework also defines the risk management approach across the company at various levels. Risk Management Committee reviews the process of risk management. The details of the Committee and meetings held during the financial year 2019-20 and its terms of reference are provided in the Corporate Governance Report. The Risk Management policy of the Company is available on website of the Company www.kiriindustries.com.

Vigil Mechanism process (Whistle Blower Policy)

As per the provisions of Section 177 of the Companies Act, 2013 and Regulation 22 of the Listing Regulations, the Company has devised a vigil mechanism named Whistle Blower Policy for escalating system of ethical concerns etc. and to deal with instances of fraud and mismanagement, if any. The details of the Whistle Blower Policy are available on the website of the Company at www.kiriindustries.com and also given in the Corporate Governance Report.

Extract of Annual Return

In accordance with Section 134(3)(a) and Section 92(3) of the Companies Act, 2013, an extract of the annual return is annexed to this report as "Annexure F" and also available on the website of the Company i.e. www.kiriindustries.com.

Composition of Committees

The Company have 5 (Five) Committees namely Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee and Risk Management Committee. A detailed note on the composition of the board and other committees are provided in the Corporate Governance Report.

Audit Committee

As required under section 177 (8) of the Companies Act, 2013 and Listing Regulations, the composition of the Audit Committee is mentioned herein below:

Name of Member Designation
Mr. Keyoor Bakshi Chairman to the Committee
Mr. Manish Kiri Member
Mr. Mukesh Desai Member
Ms. Veena Padia Member

During the year, all the recommendations made by the Audit Committee were accepted by the Board.

Corporate Social Responsibility Committee

Pursuant to Section 135 of Companies Act, 2013, the Company has constituted Corporate Social Responsibility Committee (CSR Committee) comprising of following members:

Name of Member Designation
Ms. Veena Padia Chairperson to the Committee
Mr. Pravin Kiri Member
Mr. Manish Kiri Member
Mr. Mukesh Desai Member

The Company has always been committed to the cause of social service and has repeatedly channelized its resources and activities, which positively affects the society socially, ethically and also environmentally. Your Company has taken up various Corporate Social Responsibility ("CSR") initiatives and enhanced value in the society.

The Company has formulated CSR Policy which encompasses its philosophy and guides its sustained efforts for undertaking and supporting socially useful programs for the welfare & sustainable development of the society.

The brief outline of the Corporate Social Responsibility (CSR) policy and the initiatives undertaken by the Company on CSR activities during the year under review are set out in "Annexure G" of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. For further details regarding the CSR Committee, please refer to the Corporate Governance Report. The CSR policy is available on the website of the Company i.e. www.kiriindustries.com.

Nomination and Remuneration Policy for Directors, Key Managerial Personnel and Other Employees:

As prescribed under section 178 of the Companies Act, 2013 and regulation 19 of Listing Regulations, the Company has adopted Nomination and Remuneration policy for Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and the same is available on the website of the Company i.e. www.kiriindustries.com. The relevant information as per Regulation 19 of Listing Regulations is available in the Corporate Governance report.

Human Resource Development

Your Company believes that Human Resources play a vital role in achieving its corporate goal. Hence, the Company continues to invest on hiring the best talent from other industries, developing and retaining the available talent to ensure a sustainable talent supply within the organization. The Company provides various opportunities to the employees to develop their skills to take up higher responsibilities in the organization.

Corporate Governance & Management Discussion and Analysis Report

As prescribed under Regulation 34 (3) read with Schedule V of the Listing Regulations, a separate section on corporate governance practices implemented by the Company, along with the Compliance Certificate from the Secretarial Auditors regarding compliance of conditions of corporate governance as stipulated in Listing Regulations are set out in "Annexure-H" to this Annual report.

The Management Discussion and Analysis Report on the Industry and business operations of the Company, as required under Listing Regulations are set out in "Annexure-I" of this Report.

Disclosure

As per Regulation 43A of the Listing Regulations, the Dividend Distribution Policy is disclosed in the Corporate Governance Report and is also available on the Companys website i.e. www.kiriindustries.com.

The details in respect of compliances with provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder are included in Corporate Governance Report and is available on the Companys website i.e. www.kiriindustries. com.

The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders which prohibits trading in securities of the company by directors and employees while in possession of Unpublished Price Sensitive Information in relation to the Company. The said code is available on the website of the Company at www.kiriindustries.com.

During the Year under review, company has complied with Secretarial Standards as applicable to the company.

Material Changes

There have been no material changes and commitments affecting the financial position of the Company between the end of financial year of the Company to which the financial statements relate and date of this report.

Significant and Material orders passed by the Regulators or Courts

During the financial year under review, no significant or material orders were passed by any Regulatory/ Statutory Authorities or the Courts or tribunals which would impact the going concern status of the Company and its future operations.

Details in respect of frauds reported by Auditors other than those which are reportable to the Central Government

During the year under review, the Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors as prescribed under Section 143(12) of the Companies Act, 2013 and rules made there under.

Updates on court case in Singapore

Singapore International Commercial Court (SICC) vide its order dated January 08, 2019, had directed the valuation process to value Companys 37.57% stake in DyStar. The trial for valuation of Kiris stake has been completed in two tranches during nine days hearing between February 26, 2020 and March 02, 2020 and between March 31, 2020 and April 06, 2020. The final hearing for oral closing and related arguments are also completed on July 01, 2020. The SICC has reserved its judgment, which can be delivered any time.

The SICC had delivered their judgment on March 03, 2020, in DyStar Case, against the Company and Manish Kiri for payment of total damages to USD 678,480.50 and cost of SGD 245,877.52 to DyStar in DyStars claim for violation of non-compete clause of Share Subscription and Shareholders Agreement ("SSSA") with respect to solicitation of DyStars customer(s) in Morocco and Sri Lanka. The Company has filed an appeal with Court of Appeal against the said order dated March 03, 2020. The appeal is expected to be heard by Court of Appeal sometime in September 2020.

DyStar has initiated a new suit against the Company and Mr. Manish Kiri for alleged violation of SSSA with respect to competition by the Company with DyStar through solicitation of customers of DyStar in Bangladesh, Pakistan, Iran and Brazil. The Company has filed defense and also filed counterclaim on June 08, 2020 against the claim of DyStar. The customers which are alleged by DyStar in their new claim, have been in business with the Company prior to execution of SSSA i.e. January 31, 2010. Hence, the Management does not foresee any payment of damages to DyStar.

Acknowledgement:

The Board takes this opportunity to sincerely thank all its stakeholders namely, shareholders, customers, suppliers/ contractors, employees, Government agencies, local authorities, and the immediate society for their un-stinted support and co-operation during the year.

For and on behalf of Board of Directors
Date: August 10, 2020 Pravin Kiri
Place: Ahmedabad Chairman