KM Sugar Mills Ltd Directors Report

To,

The Members,

Your directors have the pleasure of placing the 53rd Directors Report along with the Audited Statement of Accounts for the year ended on 31st March, 2026.

Financial Performance

The Financial performance of the Company during the year ended 31st March 2026 is as under:

(Rs. in Lakhs)

	Standalone		Consolidated
	Year ended on 31st March,2026	Year ended on 31st March,2025	Year ended on 31st March,2026	Year ended on 31st March,2025
Profit before finance costs, depreciation and amortization and other comprehensive income	10628	8905	10628	8905
Less: Finance costs	1170	1816	1170	1816
Less: Depreciation and amortization expense	2201	2197	2201	2197
Profit before tax	7256	4892	7256	4892
Less: Tax expense	1914	1337	1914	1337
Profit for the year	5342	3555	5342	3555
Other comprehensive income (net of tax)	(11)	(14)	(11)	(14)
Total comprehensive income for the year	5331	3541	5331	3541
Earnings per equity share of Rs. 2/- each	5.81	3.86	5.81	3.86

Corporate Benefits

The Board of Directors have not recommended a dividend for the financial year ended 31st March, 2026, in view of future deployment of funds for furtherance of business.

Adoption of Ind-As

In accordance with the Companies (Indian Accounting Standards) Rules, 2015, the Company has adopted Ind-AS for the preparation of financial statements with effect from April 01, 2017. The financial Statement for the year ended on March 31, 2026, has been prepared in accordance with the Indian Accounting Standard (IND AS) notified under Section 133 of the Companies Act, 2013, read with Companies (Accounts) Rules, 2014. The estimates and judgment relating to the Financial Statement are made on a prudent basis, so as to reflect a true and fair manner, the form and substance of transactions and reasonably present the Companys state of Affairs, profits and cash flow for the year ended March 31, 2026. Accordingly, the figures for the previous year are comparable.

Performance of Segment: -Sugar Division

The company has crushed 111.63 Lacs quintals of cane as against 110.98 lacs quintals of cane crushed during the previous financial year, and the Sugar sale was Rs. 51425 lacs during the year under review as against Rs. 52739 lacs during the previous financial year. The other details are as under:

Particulars	Year ended 31-03-2026	Year ended 31-03-2025
Gross Working days	127	128
Total Cane Crushed (qtls.)	1163276.99	11098006
Sugar Produced (qtls)	1215930	1235608
Average Recovery	10.90%	11.01%

Distillery

During the year under report, the Company produced 91.12 Lacs BL of Rectified Spirit and 90.58 Lacs BL of ethanol. The other details are as under:

Ethanol	Year ended 31-03-2026	Year ended 31-03-2025
Sales (Rs. in lacs)	5294	4276
Sales (BL in lacs)	88.33	72.39
Country Liqour
Production ((Number of cases in Lacs)	13.79	16.27
Sale (Number of cases in Lacs)	13.68	16.24

Demerger of Distillery Division

During the year under review, your Board of Directors, at its meeting held on August 07, 2025, approved a Scheme of Arrangement for the demerger of the Companys Distillery Division (Demerged Undertaking) into its wholly owned subsidiary, KM Spirits and Allied Industries Limited (Resulting Company), on a going concern basis. The proposed demerger aims to unlock shareholder value by creating focused entities for the sugar and distillery businesses, enabling better operational efficiency, independent growth strategies, and access to capital markets for the demerged entity.

The draft Scheme was filed with the Stock Exchanges and received necessary observations / no-objection letters from BSE Limited and National Stock Exchange of India Limited (NSE being the Designated Stock Exchange). The Honble National Company Law Tribunal (NCLT), Allahabad Bench, vide its order dated March 24, 2026 (received on March 27, 2026), approved the first motion application and directed the convening of meetings of equity shareholders and unsecured creditors of the Company.

Pursuant to the NCLT order, the meeting of Equity Shareholders is scheduled to be held on May 30, 2026. The Scheme is now subject to approval of the shareholders and creditors with the requisite majority and final sanction by the Honble NCLT and such other approvals, permissions, and sanctions as may be required from regulatory authorities. The appointed date for the Scheme is April 01, 2026. The demerger, upon becoming effective, will result in the issuance of equity shares of the Resulting Company to the eligible shareholders of the Company in the ratio of 1 equity share of 10 each in KM Spirits and Allied Industries Limited for every 5 equity shares of 2 each held in K M Sugar Mills Limited (subject to applicable adjustments, if any). The equity shares of the Resulting Company are proposed to be listed on the Stock Exchanges.

Your directors believe that the demerger will provide greater focus to each business vertical and create long-term value for all stakeholders.

Statutory Auditors

M/s. Mehrotra & Mehrotra., Chartered Accountants (FRN.000226C), were appointed as the Statutory Auditors of the company at the 49th AGM held on September 29, 2022 for a term of 5 (Five) consecutive years to hold the office from the conclusion of the 49th AGM to conduct statutory audit of F.Y. 2022-23, till the conclusion of 54th AGM after completing their Terms of 5 years. The Auditors Report for the financial year ended March 31, 2026, does not contain any qualification, reservation or adverse remark. The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The report is enclosed with the financial statements in this annual report.

Secretarial Auditors

M/s Amit Gupta & Associates (AGA), Company Secretaries (Firm Registration No. P2025UP103200) were appointed as the Secretarial Auditors of the company at the 52nd AGM held on September 29, 2025 for a term of 5 (Five) consecutive years to hold the office from the conclusion of the 52nd AGM to conduct statutory audit of F.Y. 2025-2026, till the conclusion of 57th AGM after completing their Terms of 5 years as required under Section 204 of the Companies Act, 2013, and Rules made thereunder. The Secretarial Audit report and Annual Secretarial Compliance Report for FY 2025-2026 form part of the Annual Report (Annexure to the Directors Report in Form MR-3) as annexed as Annexure-8 to this report and carry no qualifications, reservations, adverse remarks or disclaimers, which are self-explanatory and hence no explanations are required.

Cost Auditors

Your Board, as recommended by the Audit Committee, appointed M/s. Aman Malviya & Assoiciates, Cost Accountant, Lucknow, as a Cost Auditor for Sugar and Industrial Alcohol businesses for the financial year 2025-2026. Pursuant to the provisions of Section 148 of the Companies Act, 2013 and rules made thereunder, the Board, on the recommendation of the Audit Committee, has re-appointed M/s. Aman Malviya & Associates Cost Accountants, as Cost Auditors, to conduct cost audits relating to sugar and industrial alcohol for the year ended 31st March, 2027.

Cost Accountants have confirmed that their appointment is within the limits of Section 141(3)(g) of the Act and free from any disqualifications specified under Section 141(3) and proviso to Section 148(3) read with Section 141(4) of the Companies Act, 2013.

Public Deposits

During the financial year ended March 31, 2026, the company has not accepted any public deposits.

MSME RETURN

MCA vide order dated 22nd January, 2019, directed all companies that get supplies of goods or services from micro and small enterprises and whose payments to micro and small enterprise suppliers exceed forty-five days during the year. The Company has filed the MSME within the prescribed time.

Listing Fees

The equity shares of the company are listed with the BSE Limited and National Stock Exchange Limited, and listing fees for 2025-2026 have been duly paid.

Directors Responsibility Statement

In pursuance of sub-section (5) of Section 134 of the Companies Act, 2013, in respect of Directors Responsibility Statement, the Board of Directors confirms: (i) That in the preparation of the annual accounts for the year ended on March 31, 2026, the applicable accounting standard has been followed by the Company.

(ii) That the directors of the company have selected such accounting policies, applied them consistently, 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 the year ended on that date.

(iii) That the directors of the Company have taken proper and sufficient care for the maintenance of adequate accounting. In accordance with provisions of the Companies Act, 2013, for safeguarding the assets of the company and for detecting fraud and other irregularities, and (iv) That the directors of the Company have prepared the annual accounts on a going concern basis.

(v) That 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.

(vi) That 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.

Significant and Material Orders

There are no significant and material orders passed by the regulators or courts, or tribunals impacting the going concern status and the Companys operations in future.

Audit Committee and Vigil Mechanism

Pursuant to requirement of section 177(1) of Companies Act, 2013 read with Rule 6 of the Companies (Meeting of Board and its Powers) Rules, 2014 and Regulation 18 and Regulation 22 of SEBI(LODR) Regulation 2015, your Company has already formed the Audit Committee, composition of which is covered under Corporate Governance report section of this Annual Report.

The Vigil Mechanism of the Company, which also incorporates a Whistle Blower Policy in terms of the Listing Agreement, includes appointment of a Whistle Officer who will look into the matter, conduct a detailed investigation and take appropriate disciplinary action. The Company has formulated a vigil mechanism to provide appropriate avenues to the Directors and employees to bring to the attention of the management their genuine concern about behaviour of employees, the details of which are incorporated in the report on the corporate governance. Protected disclosures can be made by a whistleblower through an email, or dedicated telephone line or a letter to the Whistle Blower Officer or to the Chairman of the Audit Committee. During the year under review, no employee was denied access to Whistle Blower Officer or the Audit Committee, and no cases under this mechanism were reported in the company or any of its subsidiary/associates.

The Policy on vigil mechanism and whistleblower policy has been uploaded on the Companys website at the link: https://www. kmsugar.com/polices-of-kmsml/#whistle-blower-policy-vigil-mechanism.

Anti-Sexual Harassment Policy

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee has been set up to redress complaints received on sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year under review: a) Number of complaints of sexual harassment received in the year - Nil b) Number of complaints disposed off during the year - Nil c) Number of cases pending for more than ninety days - Nil

Maternity benefit provided by the company under the Maternity Benefit Act 1961

The Company declares that it has duly complied with the provisions of the Maternity Benefit Act, 1961. All eligible women employees have been extended the statutory benefits prescribed under the Act, including paid maternity leave, continuity of salary and service during the leave period, and post-maternity support such as nursing breaks and flexible return-to-work options, as applicable. The Company remains committed to fostering an inclusive and supportive work environment that upholds the rights and welfare of its women employees in accordance with applicable laws.

Share Capital: - The Paid-Up share equity Capital of the company as at March 31, 2026, is Rs. 18.40 Crores. During the year under review, the company has not issued shares or convertible securities nor granted stock options or sweat equity shares.

Annual Return

Pursuant to the provisions of section 92(3) and 134(3) of the Act and Companies (Management and Administration) Rules, 2014, the Annual Return of the company in Form No. MGT-7 can be accessed on the website of the company at https://www.kmsugar.com/annual-return/

Internal Financial Controls

The Company has adequate internal financial controls, taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Risk Management

The Company aims to have a formalized and systematic approach for managing risks across the Company. It encourages knowledge and experience sharing in order to increase transparency on the key risks to the Company to the extent possible. This approach increases risk awareness and ensures proper management of risks as part of the daily management activities. The objective of the Companys risk management process is to support a structured and consistent approach to identify, prioritise, manage, monitor and report on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives. The Company has introduced several initiatives for risk management, including the introduction of audit functions and processes to identify and create awareness of risks, optimal risk mitigation and efficient management of internal control and assurance activities. Risk Management Policy as per regulation 21 of the SEBI Listing Regulations is applicable to the top 1000 entity the basics of market capitalization, therefore the same is not applicable to the company during the reporting period.

Corporate Social Responsibility

KMSML has adopted CSR since its inception. The activities are undertaken or supported by the Company and also through a trust engaged in promoting health care, preventive health checkups, etc., projects. The Company constituted a Corporate Social Responsibility (CSR) Committee (for details, please refer Corporate Governance Report) pursuant to the requirement of Section 135(1) of the Companies Act, 2013. The CSR policy of the Company, inter alia, includes the activities, composition and meetings of the CSR committee, annual allocation for CSR activities, area of CSR projects, criteria for selection of CSR, modalities of execution/implementation of CSR activities and the monitoring mechanism of CSR activities/ projections. During the year under report, the Company has spent Rs.35.63 lakhs of which Rs. 35.50 lacs, is the Excess CSR Expenditure available for Carry Forward of FY 2026-2027 and onwards. CSR obligation of the company as per law was Rs. 81.20 Lakhs and the Board of the company decided to spend Rs. 81.33 lacs of which Rs. 81.20 Lakhs has been set off against the Excess CSR Expenditure carried forward for the FY 2022-2023 and 2023-2024. The Company has aligned its CSR Policy in line with the changes made effective from January 22, 2021, in Section 135 of the Companies Act, 2013 and the Companies (CSR Policy) Rules, 2014. A detailed Annual Report on CSR Activities undertaken by the company during the reporting period, as prescribed under Companies (Corporate Social Responsibility) Amendment Rules, 2021, is annexed herewith in

Annexure-4

Conservation of Energy, Technology Absorption and Foreign Exchange and Outgo

Information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is given in Annexure-1 .

Research and Development

The details relating to Research and Development activities carried out by the company during the year are stated in the annexure to this report.

Foreign currency risk and Commodity price risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companys exposure to the risk of changes in foreign exchange rates relates primarily to the Companys foreign currency-denominated borrowings. This foreign currency risk is covered by using foreign exchange forward contracts and currency swap contracts. The company does not have substantial transactions during the year in foreign currency, so the company does not have such of risk.

The sugar industry being cyclical in nature, realisations get adversely affected during a downturn. Higher cane price or higher production than the demand ultimately affects profitability. The Company has mitigated this risk through a well-integrated business model by diversifying into cogeneration and distillation, thereby utilising the by-products.

Particulars of Employees

The disclosure as required under the provisions of Section 197 (12) of the Companies Act, 2013, read with Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of the employees of the Company has been given in Annexure-9 and forms part of this Report.

Corporate Governance

As required under Regulation 34 of SEBI (Listing Obligations & Disclosure Requirements) Regulation, 2015, a separate section on Corporate Governance forming part of the Directors Report and the certificate from M/s, Amit Gupta & Associates Practicing Company Secretary, confirming the compliance of the conditions on Corporate Governance is attached as Annexure-2 and Annexure-3 to this report.

Management Discussion and Analysis Report

The Management Discussion and Analysis Report on the business and operations of the company is attached to this report as Annexure 5 .

Industrial Relation

The industrial relations have been cordial at all plants of the Company during the year.

Subsidiary Company

Your Company has a wholly owned subsidiary company, viz.

M/s. KM Spirits and Allied Industries Limited was incorporated on 23-02-2018 to manufacture all types of spirits. Your Company had made a total investment of Rs. 5.00 Lacs in the Company. However, the said subsidiary is yet to commence operations. In terms of proviso to section 139(3) of the Companies Act, 2013, the salient features of the financial statements of the subsidiary are set out in the prescribed form (AOC-1) under Rule-5 of the Companies (Accounts) Rules,2014 as Annexure-6 . Your Companys Policy for determination of a material subsidiary, as adopted by your Board, in conformity with Regulation 16 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, can be accessed on your Companys corporate website at www.kmsugar.com. The Company does not have any material subsidiaries. The Minutes of Board Meetings of the subsidiary companies and details of significant transactions & arrangements entered into by them are placed before the Board of Directors of the Company. The annual financial statements of the subsidiary companies are reviewed by the Audit Committee of the Company. Performance review reports of subsidiaries are also placed before the Board of Directors of the Company on a half-yearly basis Pursuant to the provisions of section 136 of the Act, the financial statements of the Company, including the consolidated financial statements along with relevant documents and separate audited accounts in respect of the subsidiary, are available on the website of the Company. The Company will make available the annual report of the subsidiary Company upon request by any shareholder of the Company interested in obtaining the same.

Consolidated Financial Statement

In accordance with the provisions of the act and listing regulations read with Ind AS-110-consolidated financial statement, Ind AS-28-investments in associates and joint ventures and Ind AS-31-interests in joint ventures, the Company has prepared a consolidated financial statement for the year ended March 31, 2026. Pursuant to the provisions of section 136 of the Act, the financial statements of the Company, including the consolidated financial statements along with relevant documents and separate audited accounts in respect of the subsidiary, are available on the website of the Company. The Company will make available the annual report of the subsidiary Company upon request by any shareholder of the Company interested in obtaining the same.

Number of Meetings of the Board

The Board met five times during the financial year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report as Annexure-2 . The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.

Policy on Directors Appointment and Remuneration, including criteria for determining qualifications, Positive Attributes, Independence of a Director, Key Managerial Personnel and other employees

The Company seeks to maintain an appropriate mix of executive and independent directors in order to maintain the independence of the Board and segregate the functions of governance and management. The Board consists of professionally qualified individuals from diverse backgrounds with wide experience in business, education, finance and public service. As at year-end, the Board consists of 8 directors, one of whom is the Managing Director, one is Joint Managing Director, one Executive Director, and five are Independent directors, including one woman director. Your Company, in compliance with section 178(1) of the Companies Act, 2013, read with The Companies (Meeting of Board and its Powers) Rules, 2014, has duly constituted a Nomination and Remuneration Committee. This committee is chaired by an independent director and formulates the criteria for determining qualifications, positive attributes, independence of a director and other matters.

Appointment and the remuneration of Board members, key managerial personnel or one level below the Board level is fixed on the basis of the recommendation of the Nomination and Remuneration Committee made to the Board, which may accept them, with or without modifications. The Company affirms that there has been no change in this policy and that the remuneration paid to directors is as per the terms laid out in this policy. Policy on Directors appointment and remuneration is available on the companys website at https://www.kmsugar.com/polices-ofkmsml/#policy-on-selection-remuneration-of-directors-kmp-andother-employees Disclosures pursuant to the requirements of section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, have been made in Annexure-9 of this Board Report

Induction & Changes in Directors

Shri Aditya Jhunjhunwala, Shri Sanjay Jhunjhunwala and Shri Subhash Chandra Aggarwal are the whole-time directors designated as

Managing Director and Joint Managing Director & Executive Director cum C.E.O. During the year under review Shri L.K.Jhunjhunwala, Chairman of the company demised on 14.03.2026. The Board expressed deep appreciation and gratitude towards his contribution to the sugar industry, society as a benevolent philanthropist during his term. The Board has appointed Mrs. Naina Devi Jhunjhunwala as an Additional Director with effect from May 18, 2026 and has also recommended her appointment as a Whole Time Director at the ensuing annual general meeting.

At the ensuing Annual General Meeting, Shri Sajay Jhunjhunwala and Shri S. C. Aggarwal, Directors of the Company, retire by rotation u/s 152 of the Companies Act, 2013 and being eligible, offered themselves for re-appointment at the ensuing Annual General Meeting.

At the ensuing Annual General Meeting, approval of the members is being sought for the continuation of the term of Mr. Sushil Solomon (DIN: 08553009), Independent Non-Executive Director of the Company, as he is attaining the age of 75 years, in compliance with Regulation 17(1A) of SEBI (LODR) Regulations, 2015.

Since the tenure of Shri Aditya Jhunjhunwala, Shri Sanjay Jhunjhunwala and Shri Subhash Chandra Agarwal as the whole-time directors designated as the Managing Director, Joint Managing Director & Executive Director cum C.E.O., respectively shall come to an end on March 31, 2027, the Board of Directors of the Company on the recommendation of the Nomination & Remuneration Committee and Audit Committee, had recommended their reappointment for further term of three years with effect from April 01, 2027. Appropriate resolutions seeking your approval for the said appointments are appearing in the Notice convening the 53rd AGM of the Company.

Attributes, Qualifications & Independence of Directors and their Appointment

The Nomination and Remuneration Committee adopted the criteria for determining qualifications, positive attributes and independence of Directors, including Independent Directors, pursuant to the Act and the Rules thereunder. The Corporate Governance Policy, inter alia, requires that Non-Executive Directors be drawn from amongst eminent professionals, with experience in business/finance/law/ public administration and enterprises. The Board Diversity Policy of your Company requires the Board to have a balance of skills, experience and diversity of perspectives appropriate to the Company. The skills, expertise and competencies of the Directors as identified by the Board, along with the names of directors who have such skills/ expertise/competence, are provided in the Report on Corporate Governance forming part of the Report and Accounts. The Articles of Association of your Company provide that the strength of the Board shall not be fewer than three nor more than fifteen. Directors are appointed/re-appointed with the approval of the Members for a period of three to five years or a shorter duration, in accordance with retirement guidelines and as may be determined by the Board from time to time. All Directors, other than Independent Directors are liable to retire by rotation, unless otherwise approved by the Members. One-third of the Directors who are liable to retire by rotation retire every year and are eligible for re-election.

Details of the Companys Policy on remuneration of Directors, Key Managerial Personnel and other employees is provided in the Report on Corporate Governance forming part of the Report and Accounts.

Declaration by Independent Directors

As per the requirement of section 149(7), the Company has received a declaration from every Independent Director that he or she meets the criteria of independence as laid down under section 149(6) read with rule 5 of the Companies (Appointment and Qualification of Directors) Rule, 2014 and Regulation 25 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. The Independent Directors of your Company have confirmed that (a) they meet the criteria of Independence as prescribed under Section 149 of the Act and Regulation 16 of the Listing Regulations 2015, (b) they are not aware of any circumstance or situation, which could impair or impact their ability to discharge duties with an objective independent judgement and without any external influence and (c) they have registered their names in the Independent Directors Databank. Further, in the opinion of the Board, the Independent Directors fulfil the conditions prescribed under the Listing Regulations 2015 and are independent of the management of the Company. The Independent Directors met twice, on 26th May, 2025 and 07th August, 2025. The Meeting was conducted without the presence of the Chairman, Executive Directors and any other Managerial Personnel.

Annual Performance Evaluation

Pursuant to the requirements of Section 134(3)(p) of the Companies Act, 2013 read with Regulation 17 of the listing regulations, the Nomination and Remuneration Committee, as reported in earlier years, formulated the Policy on Board evaluation, evaluation of Board Committees functioning and individual Director evaluation, and also specified that such evaluation will be done by the Board, pursuant to the Act and the Rules thereunder and the Listing Regulations 2015. In keeping with the Companys belief that it is the collective effectiveness of the Board that impacts the Companys performance, the primary evaluation platform is that of collective performance of the Board as a whole. Board performance is assessed against the role and responsibilities of the Board as provided in the Act and the Listing Regulations 2015, read with the Companys Governance Policy. The Nomination and Remuneration Committee has devised a criteria for evaluation of the performance of the Directors including the Independent Directors by preparing a structured questionnaire after taking into consideration inputs received from the Directors, covering various aspects of the Boards functioning, attendance, acquaintance with business, communication inter se between board members, effective participation, domain knowledge, compliance with code of conduct, vision and strategy, etc., which is in compliance with applicable laws, regulations and guidelines. Evaluation of the functioning of Board Committees is based on discussions amongst Committee members and shared by the respective Committee Chairman with the Chairman of the Nomination and Remuneration Committee, who in turn shares the consolidated report with the Chairman of the Board for his review and gives feedback to each Director. A separate exercise was carried out to evaluate the performance of individual Directors, including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interests of the Company, etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process. Reports on the functioning of Committees were placed before the Board by the Committee Chairman. The Independent Directors Committee of the Board also reviewed the performance of the non-Independent Directors and the Board, pursuant to Schedule IV to the Act and Regulation 25 of the Listing Regulations 2015.

Committees of the Board

Currently, the Board has 5 committees. A detailed note on the Board and its committees is provided in the Corporate Governance Report section of this Annual Report. The composition of the committees and compliances, as per applicable provisions of the Act and Rules, is as follows:

Name of the committee	Composition of the committee*	Highlights of duties, responsibilities and activities
Audit committee	Shri. Bibhas Kumar Srivastav-Chairman	\u2022 All recommendations made by the committee during the year were accepted by the Board.
	Shri Sushil Solomon-Member
	Shri S.C. Aggarwal-Member
		\u2022 The Company has adopted the Whistle Blower Mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud.
		\u2022 The Company has formed the Related Party Transaction Policy.
Nomination and remuneration committee	Shri Sushil Solomon-Chairman	\u2022 The Committee oversees and administers executive compensation.
	Shri Bakshi Ram- Member
	Smt. Archana Agarwal-Member	\u2022 All recommendations made by the committee during the year were accepted by the Board.
Stakeholders\u2019 relationship committee	Shri Bakshi Ram-Chairman	\u2022 The Committee reviews and ensures redresses of investor grievances.
	Smt. Archana Agarwal-Member
	Shri Sanjay Jhunjhunwala-Member	\u2022 The committee noted that the grievances of the investors reported during the year, if any.
Corporate social responsibility committee	Shri L.K Jhunjhunwala-Chairman*	\u2022 The Board as laid down the Company\u2019s policy on Corporate Social Responsibility (CSR).
	Shri Sanjay Jhunjhunwala-Member
	Shri Sushil Solomon-Member
Finance Committee	Smt. Naina Devi Jhunjhunwala-Member #	\u2022 The CSR policy is uploaded on Company website, www.kmsugar.com
	Shri Aditya Jhunjhunwala-Chairman	\u2022 The committee review\u2019s the Company\u2019s proposed capital budget
	Shri Subhash Chandra Aggarwal-Member
	Shri Bibhas Kumar Shrivastav-Member	\u2022 The committee review\u2019s company\u2019s Finances, Investments, requirement of fund and liaisoning with Bankers with the power to approve the new limits of the company as sanctioned by Bankers of the company etc.

*Ceased to be Director w.e.f from 14.03.2026 due to demise # Additional Director w.e.f 18.05.2026

Particulars of Loans, Guarantee or Investments

As per the requirement of section 186(4) of the Companies Act, 2013, particulars of loans given, investments made, guarantees given or securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient, are provided in the note number 37.8 to the financial statements. The Company is in compliance with the limits as prescribed under Section 186 of the Companies Act, 2013, read with rule 11 of the Companies (Meeting of Board and its Powers) Rules, 2014.

The Members have approved the limits under section 186(3) of Companies Act, 2013 read with rule 11 of the Companies (Meeting of Board and its Powers) Rules, 2014, (i) to the extent of Rs. 400.00 Cr or (ii) 60% of the aggregate of the paid-up share capital and free reserves and securities premium account or (iii) 100% of its free reserves and securities premium account, whichever is higher.

Particulars of contracts or arrangements with Related Party

All contracts/arrangements/transactions entered into by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which is required to be reported in Form No. AOC-2 at Annexure - 7 , in terms of Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. Transactions with the related party entered by the company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval.

The Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions as approved by the Board is put up on the Companys website and can be accessed at https:// www.kmsugar.com/polices-of-kmsml/#policy-on-related-party-transaction-pursuant-to-regulations-23-of-sebi.

There were no materially significant related party transactions which could have potential conflict with the interest of the Company at large.

The disclosures as required under Part A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, are provided in accordance with Ind AS 24 in the note number 37.8(c) to standalone and consolidated financial statements.

Key Financial Ratios

Key Financial Ratios for the financial year ended 31st March, 2026, along with details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios, and the detailed explanations, are provided in the Management Discussion and Analysis Report (Annexure -5) forming part of this report.

Acknowledgement

Your Directors place on record their acknowledgement and sincere appreciation of all the bankers and financial institutions for their continued assistance. They further appreciate and acknowledge with gratitude the co-operation and assistance received from all executives, staff and workmen of the Company.

For and on behalf of the Board
of K. M. Sugar Mills Ltd.

-Sd/-
S.C. Aggarwal
Director
DIN-02461954

-Sd/-
Aditya Jhunjhunwala
Managing Director
DIN-01686189