KSB Ltd Directors Report.

To

The Shareholders,

The Board of Directors have pleasure to submit the report and audited financial statements of the Company for the year ended 31st December, 2021.

FINANCIAL RESULTS AND DIVIDEND

Financial Results (Standalone):

Rs. Million

Year ended December 31, 2021 Year ended December 31, 2020
Revenue from operations and Other Income 15,336.68 12,404.14
Profit before tax 1,972.79 1,549.34
Income tax expense
Current 560.50 421.79
Tax settlement relating to previous years - 190.38
Deferred tax (53.73) (36.21)
Total tax expense 506.77 575.96
Profit for the year 1,466.02 973.38
Other comprehensive income 6.39 (37.74)
Total comprehensive income 1,472.41 935.64
Appropriations:
Opening balance of retained earnings 7,027.71 6,370.53
Profit for the year 1,466.02 973.38
Dividend paid (including tax thereon) (295.87) (278.46)
Other comprehensive income recognised directly in retained earnings 6.39 (37.74)
Total retained earnings 8,204.25 7,027.71
EPS 42.12 27.96

The Company does not propose to transfer any amount to its Reserves for the year under review. Dividend:

The Board of Directors propose a dividend of Rs.12.50 per share of Rs.10 each (125 %).

Dividend Distribution Policy of the Company as required under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations, 2015") is available on the Companys website at: www.ksbindia.co.in

GENERAL REVIEW

Working:

The Financial year 2021 posed challenges on account of the second wave of COVID-19, but with adherence to strict safety protocols, the Company managed to keep the impact on the operations and business activities to minimum. The companys plants across locations have performed well despite multi-pronged challenges. During the year, we took up capacity expansion project at our plant in Sinnar, which is nearing completion. The Company is focusing on new segments like Solar, which has helped us achieve good growth in Solar pumps business.

The company could achieve good performance during the year 2021, despite multiple challenges

in terms of COVID-19 restrictions, commodity price increase and supply chain disruptions on the back of excellent mitigation strategies adopted by the management. Building supply chain resilience and long term capabilities has helped the Company in reducing impact of disruptions and improving productivity.

Export increased by Rs.652 Million from Rs.2,373 Million last year to Rs.3,025 Million.

The Company continues with its efforts to maintain growth even during the continued pandemic situation and related challenges.

Credit Rating:

Reaffirmation for the Long Term rating (Fund based) [ICRA] AA+ (stable) and Short Term Rating [ICRA] A1+ assigned for the Line of Credit of the Company continues during the year 2021. This reaffirms the high reputation and the trust Company has earned for its sound financial management and its ability to meet financial obligations. Below Credit Ratings are obtained during past 3 years:

Year Amount ( in Million) Rating
2020 25,000.00 Long Term AA+, Short Term A1 +
2019 25,000.00 Long Term AA+, Short Term A1 +
2018 12,000.00 Long Term AA+, Short Term A1 +

The Company does not have any debt instruments, fixed deposit program or any scheme for mobilization of funds and accordingly it has not obtained any credit ratings during the financial year for these purposes.

Fixed Deposits:

The Company has not accepted any deposits.

Transfer to Investor Education and Protection Fund ("IEPF"):

During the year, in accordance with section 125 of the Companies Act, 2013 ("the Act") an amount of Rs.4,18,991.50 being unclaimed dividends up to the year 31st December, 2013, were transferred to the Investor Education and Protection Fund established by the Central Government.

Pursuant to the provisions of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules 2016 ("IEPF Rules"), as amended, the shares on which dividend remains unpaid / unclaimed for seven consecutive years or more shall be transferred to the Investors Education and Protection Fund (IEPF). Accordingly, during the year Company has transferred 2,836 equity shares to the IEPF. The details of equity shares transferred are available on the Companys website at: www.ksbindia.co.in

Subsidiary and Associate:

The Company has 1 subsidiary, viz. Pofran Sales and Agency Limited and 1 associate, viz. KSB MIL Controls Limited as on 31st December, 2021.

In accordance with Section 129 (3) of the Act and Regulation 34 of Listing Regulations, 2015, the audited consolidated financial statements of the Company form part of the Annual Report. A statement containing salient features of the financial statements of the Companys subsidiary and associate is annexed to this Report in prescribed form AOC-1 as Annexure I.

The audited financial statements of Pofran Sales and Agency Limited for the year ended 31st March, 2021 have been placed on the website of the Company viz. www.ksbindia.co.in and are available for inspection at the registered office of the Company. The Company will also make available these documents electronically upon request by any member of the Company interested in obtaining the same.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Annexed to this report as Annexure II.

REPORT ON CORPORATE GOVERNANCE

Annexed to this Report alongwith certificate thereon as Annexure III.

BUSINESS RESPONSIBILITY REPORT Annexed to this report as Annexure IV.

ANNUAL RETURN

In accordance with the provisions of the Act, the Annual Return of the Company is hosted on website of the Company at : www.ksbindia.co.in

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Contracts or arrangements with related parties referred to under Section 188 of the Act, entered into during the financial year, were on an arms length basis. No material contracts or arrangements with related parties were entered into during the year under review. Accordingly, no transactions are being reported in form AOC- 2 in terms of section 134 of the Act.

DISCLOSURE UNDER REGULATION 34(3) OF SEBI LISTING REGULATIONS, 2015

There are no loans and advances in the nature of loans to subsidiary/associate/firms/ Companies in which Directors are interested.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not granted any loans, guarantees and investments covered under section 186 of the Act during the year.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism to provide avenues to the stakeholders to bring to the attention of the management, the concerns about behaviours employees that raise concerns including fraud by using the mechanism provided in the Whistle Blower Policy. The details of the said policy are included in the report on Corporate Governance.

RISK MANAGEMENT

The Company has laid down procedures and informed the Board members about the risk assessment and minimization procedures. These procedures are periodically reviewed to ensure that executive management controls risk through means of a properly defined framework. The Risk Management Committee monitors the risks and their mitigation actions.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There is no significant or material order passed during the year by any regulators, courts or tribunals impacting the going concern status of the Company or its future operations.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

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.

POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder, to redress complaints received regarding sexual harassment. The Company has in place a policy in line with the requirements of the said Act. During the year, nil complaint with allegations of sexual harassment was received by the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Dr. Matthias Schmitz retires by rotation and is eligible for reappointment. The Board recommends the re-appointment.

The Members in the 61st Annual General Meeting of the Company held on 29th April, 2021, based on recommendation of the Nomination and Remuneration Committee, and the Board of Directors, had re-appointed Mr. Rajeev Jain as Managing Director and Key Managerial Personnel of the Company for a term of 5 years effective from 1st July, 2021.

DECLARATIONS BY INDEPENDENT DIRECTORS

The Independent Directors have given a declaration to the Company that they meet the criteria of independence as per Section 149(6) of the Act and Regulation 25 of the Listing Regulations, 2015. BOARD MEETINGS

During the year ended 31st December, 2021, four meetings of the Board were held.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and other matters forms part of report on Corporate Governance. The detailed policy is available on the Companys website at: www.ksbindia.co.in

EVALUATION OF BOARD OF DIRECTORS

The details of the annual evaluation of Board, its Committees and individual Directors are mentioned in the report on Corporate Governance.

BOARD COMMITTEES

The Company has five Committees of Board, viz,

1. Audit Committee

2. Stakeholders Relationship Committee

3. Nomination and Remuneration Committee

4. Corporate Social Responsibility Committee

5. Risk Management Committee

Details of all the Committees along with their composition, terms of reference and meetings held during the year are provided in report on Corporate Governance.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, the Board of Directors report that:

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

(b) they have 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 or loss of the Company for that period;

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

(d) they have prepared the annual accounts on a going concern basis;

(e) proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively; and

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

PARTICULARS OF EMPLOYEES AND RELATED INFORMATION

In terms of the provisions of Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement containing the disclosures pertaining to remuneration and other details as required under the Act and the above Rules are provided in the Annual Report. The disclosures as specified under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed to this Report as Annexure V.

The information regarding employee remuneration as required pursuant to Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, will be available electronically for inspection by members on all working days (Monday to Friday) between 10.00 a.m. and 12.00 noon upto Wednesday 11th May, 2022, being the date of the 62nd AGM. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished electronically on such request.

STATUTORY AUDITORS

Pursuant to the provisions of Section 139 of the Act and the Rules thereunder, M/s Price Waterhouse Chartered Accountants LLP (Firm Reg. No. 012754N/N500016), the present Auditors of the Company, complete their term as Statutory Auditors of the Company at the conclusion of 62nd Annual General Meeting.

In view of the above, the Board of Directors of the Company, on the recommendation of the Audit Committee has recommended re-appointment of M/s Price Waterhouse Chartered Accountants LLP, as Statutory Auditors of the Company for a term of five years from the conclusion of this Annual General Meeting until the conclusion of the 67th Annual General Meeting. The said Auditors have communicated their willingness and eligibility as statutory auditors of the company.

Accordingly, the Board recommends the re-appointment of M/s Price Waterhouse Chartered Accountants LLP, as statutory auditors of the company for approval of the shareholders.

COST AUDITORS

Maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Act, 2013, is required by the Company and accordingly such accounts and records are prepared and maintained. Pursuant to Section 148, the Board on the recommendation of the Audit Committee has re-appointed M/s Dhananjay V. Joshi and Associates, Cost Accountants, Pune as Cost Auditors to carry out the audit of Cost Accounts of the Company for the financial year 2022 at a remuneration as mentioned in the Notice convening the 62nd Annual General Meeting and the same is recommended for your consideration and ratification. The Cost Audit Report for financial year 2020 which was due to be filed with the Ministry of Corporate Affairs before 29th June, 2021, was filed on 24th June, 2021 and it did not contain any qualification, reservation, adverse remark or disclaimer.

SECRETARIAL AUDITORS

Pursuant to provisions of Section 204 of the Act and Rules thereunder, the Secretarial Audit Report for financial year 2021 issued by Secretarial Auditors, M/s Nilesh Shah and Associates, Company Secretaries, Mumbai is annexed to this report as Annexure VI and it does not contain any qualification, reservation, adverse remark or disclaimer except the self explanatory comments.

The Board based on the recommendation of Audit Committee has appointed M/s Mehta and Mehta Associates, Company Secretaries as the Secretarial Auditors of the Company for the Financial Year 2022.

SECRETARIAL STANDARDS

During the year 2021, the Company has complied with applicable Secretarial Standards issued by the Institute of the Company Secretaries of India.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information as required to be given under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in the annexure to this report as Annexure VII.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The composition of the CSR Committee, CSR Policy and other required details are given in the Annual Report on CSR Activities annexed to this Report as Annexure VIII.

ACKNOWLEDGEMENTS

The Board of Directors are grateful to Canadian Kay Pump Ltd., the main shareholder, and to KSB SE & Co. KGaA, Germany, the Companys collaborators, for their valuable assistance and support. They wish to record their appreciation for the co-operation and support of the Companys shareholders, bankers and all employees including the workers, staff and management and all others concerned with the Companys business.

On behalf of the Board of Directors
GAURAV SWARUP
Kolkata, 24th February, 2022 Chairman