Kirloskar Pneumatic Company Ltd Directors Report.

Your Directors have pleasure in presenting this Report with Audited Annual Accounts of the Company for the year ended 31st March, 2021.

1. COMPANY SPECIFIC INFORMATION

1.1. Financial Summary & Highlights

The financial results for the year ended 31st March, 2021 are summarized below:

Amount Rs. in Million

2020-21 2019-20
Total Income 8,333.80 8,395.96
Profit before tax 838.78 719.15
Tax Expense (Current & Deferred tax) 200.36 184.23
Profit after tax 638.42 534.92
Other Comprehensive Income / (Loss), net of tax 278.20 (213.41)
Total Comprehensive Income for the year 916.62 321.51
Transferred to General Reserve 700.00 300.00

Your Company earned a total income of Rs. 8,333.80 Million for the financial year 2020-21, against Rs. 8,395.96 Million of the previous year. Your Company earned a net profit of Rs. 638.42 Million compared to Rs. 534.92 Million earned in last year representing an increase over 19%.

1.2. Reserves

During the reporting year, Rs. 700 Million has been transferred to the General Reserves of the Company.

1.3. Dividend

The Board of Directors has recommended a dividend of Rs. 3.50 (175%) per equity share of Rs. 21- each for the year 2020-21 which shall be paid subject to the approval of shareholders in the ensuing Annual General Meeting as against dividend aggregating to Rs. 2.70 (135%) per equity share of Rs. 2/- each for the year 2019-20.

1.4. Major events that occurred during the year

Segment-wise position of business and its operations

Operations of the Company witnessed disruptions in the business during the first quarter of the financial year due to nationwide lockdown imposed to curb the outbreak of COVID-19. Despite these disruptions, Compression Segment registered a modest growth over the previous year by earning revenue of Rs. 7,853 Million as compared to Rs. 7,752 Million in the previous year. Transmission Segment however earned lower revenue of Rs. 313 Million compared to Rs. 478 Million in the previous year.

2. CAPITAL STRUCTURE

Increase in Share Capital

During the year, the Company allotted 45,600 equity shares of Rs. 21- each upon the exercise of the options granted to employees of the Company pursuant to KPCL Employee Stock Option Scheme 2019 (KPCL ESOS 2019 or ‘the Scheme). Issued Capital, Subscribed Capital and Paid-up Capital of the Company therefore increased by Rs. 91,200 and was Rs. 128,534,580/- consisting of 64,267,290 equity shares of Rs. 21- each as on 31st March 2021.

Employee Stock Option Scheme

Your Company introduced KPCL ESOS 2019 in orderto motivate, incentivize and reward its employees. Your Company views employee stock options as an instrument that would enable the employees to share the value they create for the Company and align individual objectives of the employees with the objectives of the Company.

The Nomination and Remuneration Committee at its meeting held on 22nd October, 2019 approved the grant of 684,000 stock options exercisable into 684,000 Equity Shares of Rs. 21- each of the Company to its specified employees.

The Scheme is in compliance with the applicable provisions of the Companies Act, 2013 and the Rules issued thereunder, Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("Employee Benefit Regulations") and other applicable regulations, if any.

The disclosures as required under the Companies (Share Capital and Debentures) Rules, 2014 for the year 2020-21 is as under:

Options granted during the year Nil
Options vested during the year 196,500
Options exercised during the year 45,600
The total number of shares arising as a result of exercise of option during the year 45,600
Options forfeited / lapsed / cancelled / expired during the year 37,000
The exercise price (In Rs.) 120
Variation of terms of options during the year No variation
Money realized by exercise of options during the year (In Rs.) 5,472,000
Total number of options in force 601,400
During the year 2020-21, Employee wise details of options granted to :
1. Key Managerial Personnel: Nil
2. Any other employee who receives a grant of options in any one year of option amounting to five percent or more of options granted during the year 2020-21. Nil
3. Identified employees who were granted option, during any one year, equal to or exceeding one percent of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant during the year 2020-21. Nil

The certificate from P G Bhagwat, LLP, Chartered Accountants, Statutory Auditors of the Company, confirming that the Scheme has been implemented in accordance with the aforesaid regulations and in accordance with the resolution passed by the Company at its Annual General Meeting held on 20th July, 2019, will be placed before the shareholders at the ensuing Annual General Meeting. Acopy of the same will be available for inspection at the Companys website and can be accessed on the following weblink https://kirloskarpneumatic.com/site/assets/files/6421/esos_certificate.pdf

The disclosures relating to the implementation of the Scheme, details of options granted, changes to the Scheme, if any, etc. are placed on the website of the company as required under the Employee Benefit Regulations, 2014 read with SEBI Circular No. CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 and can be accessed on the following weblink https://kirloskarpneumatic.com/site/assets/files/6408/ disclosure_under_esos.pdf

In line with the Indian Accounting Standards ("IND AS") 102 on Share Based Payments issued by the Institute of Chartered Accountants of India ("ICAI"), your Company has computed the cost of equity- settled transactions by using the fair value of the options at the date of the grant and recognized the same as employee compensation cost over the vesting period.

3. AWARDS

During the reporting year, your Company was recognized with prestigious and diverse external accolades which include:

? "Prize for Leadership in HR Excellence 2020-21" in 11" CM HR Excellence Assessment for the year 2020-21.

? 1st Prize under Large Scale Category - an Award for Green Initiatives in Industry by MCCIA. Awards in the 34th National Convention on Quality Concepts NCQC -2020 organized by QCFI:

? 1 "Par Excellence Award Trophy"

? 4 "Excellence Award Trophy"

? 1 "Distinguish Award Trophy"

Awards in the SS"1 Annual Chapter Convention on Quality Concepts CCQC - 2020 organized by QCFI:

? 3 "Gold Trophy"

? 3 "Silver Trophy"

4. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

No Loans, Guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given / provided / made during the reporting year.

During the reporting year, the Company has not made any investment except investments in Mutual Funds.

5. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Details of the transfer/s to the IEPF made during the year as mentioned below:

During the reporting year, your Company transferred following amount and shares to the Investor Education and Protection Fund.

Final Dividend for the year 2012-13 2,543,136
No. of shares of Rs. 2/- each 25,860

Year wise amount of unpaid / unclaimed dividend lying in the unpaid account up to the year and the corresponding shares, which are liable to be transferred to the IEPF and the due dates for such transfer:

Sr. No. Year Amount to be Transferred as on 31-03-2021 Corresponding Number of Equity Shares of the Company Date of Transfer
1 Final Dividend 2013-14 2,148,960.00 214,896 27th August, 2021
2 Final Dividend 2014-15 1,227,975.00 245,595 3rd September, 2022
3 Dividend 2015-16 (Interim) 1,642,256.00 234,608 19th April, 2023
4 Dividend 2015-16 (Interim - PHL) 1,403,667.00 155,963 6th May, 2023
5 Dividend 2016-17 (Interim - PHL) 1,209,660.00 161,288 3rd May, 2024
6 Final Dividend 2016-17 4,270,360.00 427,036 1st September, 2024
7 Final Dividend 2017-18 3,854,220.00 321,185 29th August, 2025
8 Dividend 2018-19 (Interim) 1,605,781.00 1,605,781 28th February, 2026
9 Final Dividend 2018-19 2,367,448.50 1,578,299 25th August, 2026
10 Dividend 2019-20 (Interim) 1,655,725.00 1,655,725 28th February, 2027
11 Dividend 2019-20 (Second Interim) 3,021,399.80 1,777,294 9th April, 2027

Note : The Sr No. 4 & 5 states the amount of dividend declared and paid by erstwhile Pneumatic Holdings Limited, which was merged into the Company w.e.f. 28th April, 2017 by virtue of the order of the Honble National Company Law Tribunal, Mumbai.

6. DIRECTORS

i. Directors and Key Managerial Personnel

During the year, your Company appointed Mr K Srinivasan as Additional and Independent Director on 25th June, 2020 subject to approval of Members. The Members approved the appointment of Mr K Srinivasan as Independent Director of the Company by way of Postal Ballot on 30th July, 2020.

Further Mr K Venkata ram an an and Mrs Nalini Venkatesh were re-appointed as Independent Director(s) of the Company by the Members by passing special resolution(s) through Postal Ballot on 30th July, 2020.

Mr Tejas Deshpande was appointed as an Independent Director by the Board of Directors with effect from 27th October, 2020 to hold office for a term of 5 (Five) consecutive years upto 26th October, 2025, subject to the approval of the Members. The necessary resolution for appointment of Mr Tejas Deshpande is considered in the forthcoming Annual General Meeting.

The Board of Directors is of the opinion that all the above Independent Directors hold the highest standards of integrity and possess necessary expertise and experience including proficiency in the field in which your Company operates.

Mr K Srinivasan tendered his resignation as an Independent Director of the Company on 27th October, 2020 in the Board Meeting with immediate effect. He was appointed as an Additional and Whole-Time Director designated as Executive Director of the Company by the Board of Directors in the same Board Meeting with effect from 27th October, 2020 to 1st January, 2021 and was re-designated as the Managing Director, with substantial powers of management, w.e.f. 2nd January, 2021 upto 26th October, 2023 subject to the approval of the Members. Details of the proposal for appointment of Mr K Srinivasan are given in the Explanatory Statement to the Notice of the 46th Annual General Meeting as required under Section 102 of the Companies Act, 2013. The necessary resolution for appointment of Mr K Srinivasan is proposed for approval in the forthcoming Annual General Meeting.

Mr Mahesh Chhabria was appointed as an Additional Director by the Board of Directors with effect from 3rd March, 2021 to hold office upto the forthcoming Annual General Meeting. The necessary resolution for appointment of Mr Mahesh Chhabria is proposed for approval in the forthcoming Annual General Meeting.

The tenure of Mr Aditya Kowshik as Managing Director was completed on 1st January, 2021, consequently he ceased to be Director on that date. The Board of Directors places on record its sincere appreciation for the contribution made by him during his tenure.

Mr Vikram S Kirloskar, Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. The necessary resolution for appointment of Mr Vikram S Kirloskar is proposed for approval in the forthcoming Annual General Meeting.

Mr Rahul C Kirloskar was appointed as Whole Time Director designated as Executive Chairman up to 22nd January, 2022. He is further re-appointed as Whole Time Director designated as Executive Chairman for a period of 5 years with effect from 23rd January, 2022 subject to approval of Members in the ensuing Annual General Meeting. Details of the proposal for re-appointment of Mr Rahul C Kirloskar are given in the Explanatory Statement to the Notice of the 46tl1 Annual General Meeting as required under Section 102 of the Companies Act, 2013. The necessary resolution for appointment of Mr Rahul C Kirloskar is proposed for approval in the forthcoming Annual General Meeting.

ii. Declaration from Independent Directors and Statement on Compliance of Code of Conduct

Your Company has received necessary declarations from all its Independent Directors stating that they meet the criteria of independence as provided in Sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16 (1) (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Independent Directors have complied with the code for Independent Directors prescribed in Schedule IV to the Companies Act, 2013.

All the Directors and Senior Management Personnel have also complied with the Code of Conduct of the Company as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for its Directors and Senior Management.

iii. Directors Appointment and Remuneration Policy

The Board, on the recommendation of the Nomination and Remuneration Committee, adopted a policy for selection and appointment of Directors, Key Managerial Personnel (KMP) and Senior Management Personnel. Policy also prescribes the guidelines for determining the remuneration of Executive Directors, Non-Executive Directors, KMP and Senior Management.

The Remuneration Policy is available on the website of the Company, viz. www.kirloskarpneumatic. com

iv. Board Evaluation

The annual evaluation framework for assessing the performance of Directors comprises of the following key areas:

a) Attendance in the meetings, participation and independence during the meetings;

b) Interaction with Management;

c) Role and accountability of the Board;

d) Knowledge and proficiency; and

e) Strategic perspectives or inputs.

The evaluation involves assessment by the Nomination and Remuneration Committee and Board of Directors. A member of the Nomination and Remuneration Committee and Board does not participate in the discussion of his / her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 (10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out performance evaluation of its own performance and that of its committees and individual Directors.

v. Number of Meetings of the Board

A calendar of meetings is prepared and circulated in advance to the Directors. During the year, five Board Meetings were convened and held, the details of which are given in the Report on Corporate Governance. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

vi. Composition of Committee Meetings

The composition of the Audit Committee, Nomination and Remuneration Committee & Stakeholders Relationship Committee constituted by the Board under the Companies Act and Listing Regulations as well as changes in the composition, if any and no. of meetings held during the year forms part of the Report on Corporate Governance.

vii. Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanation obtained by them, the Directors in terms of clause (c) of Sub-section (3) of Section 134 state that:

a) In the preparation of the annual accounts, the applicable Indian Accounting Standards (IND AS) have been followed and there have been no material departures;

b) Accounting policies as mentioned in the financial statements have been selected and applied 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 as at 31st March, 2021 and of the profit of the company for the year ended on that date;

c) Proper and sufficient care has been taken 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 prevention and detection of fraud and other irregularities;

d) The annual accounts have been prepared on a going concern basis;

e) Proper internal financial controls have been laid down for the company and that such internal financial controls are adequate and are operating effectively; and

f) Proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and operating effectively.

7. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions which were entered into during the financial year were on an arms length basis and in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

The statement that the transactions are at arms length and in the ordinary course of business is supported by a certificate from the Managing Director. The Company has also obtained the certificate from a Chartered Accountant on periodical basis.

All Related Party Transactions have been placed before the Audit Committee for their approval and to the Board, as and when required.

In certain cases, prior omnibus approval of the Audit Committee is obtained on a yearly basis. The transactions entered into pursuant to the omnibus approval so granted are reviewed by the Audit Committee on a quarterly basis.

The policy on Related Party Transactions as approved by the Board is uploaded on the Companys website.

The disclosures as per Indian Accounting Standards (IND AS) for transactions with related parties are provided in the Financial Statement of the Company.

8. RISK MANAGEMENT

Though the provisions related to the Risk Management Committee of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are not applicable to the Company, the Company has in place a Risk Management Committee of the Board, Corporate Risk Management Committee and Segment Level Risk Committees.

The Company has a Risk Management framework to identify, evaluate business risks and opportunities. To strengthen the risk management framework, Company has Segment Level Risk Committees, Corporate Risk Management Committee and Board level Risk Management Committee. This framework seeks to minimize adverse impact on the business objectives and enhance the Companys competitive advantage.

9. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System commensurate with the size, scale and complexity of its operations. The scope of the Internal Audit is decided by the Audit Committee and the Board. To maintain its objectivity and independence, the Board has appointed an external Auditor, which reports to the Audit Committee of the Board on a periodic basis.

The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies for various functions of the Company. Based on the report of Internal Auditor, process owners undertake corrective action wherever required in their respective areas and thereby strengthen the controls further. Audit observations and actions taken thereof are presented to the Audit Committee of the Board on periodic basis.

During the reporting year, Internal Financial Controls laid down by the Board were tested for adequacy & effectiveness and no reportable material weakness in the design or operations was observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information. Statutory Auditors have also given unmodified audit opinion on adequacy of internal financial controls system with reference to financial statements.

10. AUDITORS

a) Statutory Auditors

The Auditors of the Company, P G Bhagwat LLP (Formerly M/s P G Bhagwat), Firm Registration No. 101118W/W100682, Chartered Accountants, Pune, were appointed as StatutoryAuditorfora period of five years from 41st Annual General Meeting. Accordingly, the term of P G Bhagwat LLP as Statutory Auditor will be completed at the conclusion of this ensuing Annual General Meeting in terms of the said approval and Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014.

There are no qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their Audit Report for the year ended 315t March, 2021.

The Auditors of the Company, P G Bhagwat LLP (Formerly M/s P G Bhagwat), Firm Registration No. 101118W/W100682, Chartered Accountants, Pune, were the Auditors of the Company for two consecutive periods of 5 years each and are not eligible for re-appointment as Auditors of the Company for a further period. The Audit Committee and Board of Directors of the Company have therefore recommended appointment of Kirtane & Pandit LLP (Firm Registration No. 105215W/ W100057), Chartered Accountants as the Statutory Auditors of the Company for a term of 5 (five) consecutive years from the conclusion of the 46th Annual General Meeting till the conclusion of the 51st Annual General Meeting of the Company at such remuneration plus applicable taxes, and out of pocket expenses, as may be determined and recommended by the Audit Committee in consultation with the Auditors and duly approved by the Board of Directors of the Company.

Details of the proposal for appointment of Kirtane & Pandit LLP are given in the Explanatory Statement to the Notice of the 46th Annual General Meeting as required under Section 102 of the Companies Act, 2013. Accordingly, the necessary resolution for appointment of Kirtane & Pandit LLP, Chartered Accountants for a period of five year(s) is proposed for approval in the forthcoming Annual General Meeting.

b) Cost Auditors

The Board of Directors had, on the recommendation of the Audit Committee, appointed M/s Sudhir Govind Jog, a proprietary firm to audit the cost accounts of the Company for the financial year 2021-22 on a remuneration of Rs. 0.6 Million.

As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a resolution seeking Members ratification for the remuneration payable to M/s Sudhir Govind Jog, a proprietary firm as Cost Accountant for the year ended on 31st March, 2022 is proposed for approval in the forthcoming Annual General Meeting.

c) Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s SVD & Associates, a partnership firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The report of the Secretarial Audit is annexed herewith as Annexure "1 ",

There are no qualifications, reservations or adverse remarks or disclaimer made by the Secretarial Auditors in their Secretarial Audit Report for the year ended 31st March, 2021.

M/s SVD & Associates, a partnership firm of Company Secretaries has submitted Annual Secretarial Compliance Report as laid down in SEBI Circular CIR/CFD/CMD1/27/2019 dated 8th February, 2019 and has also confirmed that the Company has complied with all applicable SEBI Regulations and circulars / guidelines issued thereunder, for the financial year 2020-21. Observations made by the Secretarial Auditors in their Annual Secretarial Compliance Report for the year ended 31st March, 2021, are self-explanatory.

11. SECRETARIAL STANDARDS

The Institute of Company Secretaries of India had revised the Secretarial Standards on Meetings of the Board of Directors (SS-1) and Secretarial Standards on General Meetings (SS-2) with effect from 1stOctober, 2017. The Company is in compliance with the revised Secretarial Standards.

12. REPORTING OF FRAUDS BY AUDITORS

During the reporting year, neither the statutory auditors nor the secretarial auditor has reported to the Audit Committee, under Section 143 (12) of the Companies Act, 2013, any instance of fraud committed against the Company by its officers or employees. Therefore no details are required to be provided in the Boards report.

13. CORPORATE GOVERNANCE

The Company strives to maximize the wealth of the shareholders by managing the affairs of the Company with pre-eminent level of accountability, transparency and integrity. A report on Corporate Governance including the relevant Auditors Certificate regarding compliance with the conditions of Corporate Governance as stipulated in Regulation 34 (3) read with Part E of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed and forms part of the Annual Report.

State of Companys affairs and future outlook is provided in the Management Discussion and Analysis Report, annexed hereto forming part of Directors Report.

14. ANNUAL RETURN

The Annual Return as provided under Sub-section (3) of Section 92 of the Companies Act, 2013 is available on the following web-link : https://kirloskarpneumatic.com/site/assets/files/6407/annual_ return_2020-21.pdf

15. CORPORATE SOCIAL INITIATIVES

The Board has established a CSR Committee to monitor its CSR activities. On the recommendation of the CSR Committee, the Board of Directors has adopted a CSR Policy in line with the Companies Act, 2013.

As part of its initiatives under Corporate Social Responsibility (CSR), the Company has undertaken projects in the areas of Promoting Education, Education of Girls, Environment, Health and Sanitation. These projects are largely in accordance with Schedule VII of the Companies Act, 2013. During the reporting year, the scope of some of the projects as stated in the CSR Policy was expanded to accommodate the needs and expectations of the relevant stakeholders due to COVID-19 Pandemic.

This year of COVID-19 Pandemic was characterised by lockdowns and unlock related challenges for everyone including our CSR beneficiaries. Your Company through its Health & Hygiene initiatives has reached out to most of the schools adopted for its CSR activities and provided them need based supports like masks, sanitizers, liquid soap, awareness displays, sanitation material etc. for their reopening. COVID-19 related supports like grocery kits, masks, sanitizers etc. were also provided to people living with HIV and their families through DISHA Initiative during and post lockdown periods. The education related CSR initiatives (Bharari and KaShi) also focused on supporting girl education by facilitating eLearning byway of distributing tablets, establishing eLearning facility in a school and conducting online classes etc. Your Company is participating in Ramnadi Restoration Mission of Kirloskar Vasundhara Initiative by way of supporting RRM School Project in which various activities for children from 20 schools in the vicinity of Ramnadi river are being implemented. The details on CSR activities are provided in Management Discussion Analysis Report.

During the reporting year, the CSR Policy was amended pursuant to Companies (Corporate Social Responsibility) Amendment Rules, 2021, effective from 1st April, 2021. This CSR policy is available on the website of the Company.

CSR Policy in brief:

The focus of CSR activities will be on Education, Environment and Health.

While devising projects, care would be taken to promote education, health and sanitation, protect the environment and minimize adverse impact, if any, on the society at large.

The Company shall spend at least 2% (two percent) of the average net profits, calculated in accordance with the provisions of the Companies Act, 2013 and Rules thereunder, made by it in three immediately preceding financial years, in every financial year.

The Annual Report on CSR Activities is annexed herewith as Annexure "2".

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

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) Rules, 2014, is annexed herewith as Annexure "3".

17. BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report as required under Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, forms part of this Annual Report.

18. MATERIAL CHANGES AND COMMITMENTS, BETWEEN THE DATE OF BALANCE SHEET AND THE DATE OF REPORT

There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the Financial Statements relate and the date of this Report.

19. MAINTENANCE OF COST RECORDS

Your Company confirms that the maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, is required by the Company and accordingly such accounts and records are made and maintained.

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

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

21. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism for Directors and Employees to report their genuine concerns, details of which have been given in the Report on Corporate Governance.

22. FIXED DEPOSIT

Your Company has discontinued accepting fixed deposits since 2001-02. As such, as of 31st March, 2021 there are no fixed deposits outstanding.

23. PARTICULARS OF EMPLOYEES

Disclosures with respect to the remuneration of Directors and Employees as required under 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 annexed as Annexure "4" to this Report.

In accordance with the provisions of Section 197(12) of the Companies Act, 2013 and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the names and other particulars of Employees are available at the Registered Office of the Company during working hours for a period of 21 days before the Annual General Meeting and shall be made available to any shareholder on request.

24. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company has formulated Prevention of Sexual Harassment of Women at Workplace Policy and the highlights are communicated to all Employees and also displayed across all its locations as well as on its intranet.

Your Company has complied with provisions relating to constitution of Internal Committee (IC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. IC meets every quarter and submits the minutes of meeting to the employer i.e. Managing Director. During the reporting year, four such meetings were conducted and no complaint has been received.

During the reporting year, to create ongoing awareness, your Company has :

• Continued with a PoSH Awareness Module in its employee induction program.

• Conducted nine workshops (in induction programs) for 28 new employees.

25. EMPLOYEES

Your Company has taken several initiatives for Human Resource Development and manpower retention. Manpower is classified under Frontend, Internal and Support functions for better Customer Reach and Support. Assessment of performance through a robust and interactive PMS procedure, identifying Learning needs through the 70-20-10 format, Career Counselling and Skill Development Programs are some of the initiatives adopted by your Company. Training programs are designed to enhance skills, knowledge and behaviour. Employees are motivated through empowerment and rewards for good performance. Adoption of 5S across the Company has led to a clean and healthy environment. Your Company has achieved an India benchmark employee engagement score of 85 in the engagement survey 2019 conducted by an external Independent Agency. Your Company has been conferred with "Prize for Leadership in HR Excellence" in the 11th CM HR Excellence Award - 2020.

Your Company has 711 permanent employees on its rolls as on 31st March, 2021.

26. ACKNOWLEDGEMENT

The outbreak of the COVID-19 pandemic resulted into loss of several lives in India and abroad. Various stakeholders have lost their colleagues, close relatives and acquaintances. The Directors regret this loss and are deeply grateful to and have immense respect for every stakeholder who risked his / her life in fighting this pandemic.

The Directors wish to convey their appreciation to all employees for their individual efforts and collective contribution to your Companys performance under difficult and challenging conditions. The Directors would also like to thank the shareholders, customers, dealers, suppliers, bankers and all other stakeholders for their continued support and confidence in the management of the Company.