l t foods ltd split bonus balance sheet Directors report


To

The Members

Your Directors take pleasure in presenting the 33rd Annual Report on the business and operations of the Company and the accounts for the financial year ended March 31, 2023.

Financial Highlights

In compliance with the provisions of the Companies Act, 2013 ("Act"), and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the Company has prepared its financial statements as per Indian Accounting Standards ("IndAS") for the financial year 2022-23. The financial highlights of the Companys operations are as follows: (H in Lakhs)

Particulars Standalone Consolidated
2022-23 2021-22 2022-23 2021-22
Revenue from Operations 3,91,459.99 2,83,999.61 6,93,579.19 5,42,737.17
Other Income 3,682.45 2,358.76 4,302.14 2,320.91
Operating Profit before Finance Costs, Depreciation, 26,354.81 20,400.79 77,159.06 61,495.55
Tax and Extraordinary items
Less: Depreciation and amortisation expenses 2,889.97 3,246.54 12,690.72 12,263.24
Less: Finance Cost 2,396.79 2,278.55 8,210.03 6,872.62
Less: Other Expense 57,916.90 37,842.95 1,29,798.44 92,701.00
Share of net profit/(loss) of associates and joint ventures accounted for using the equity method - - 2,786.22 (485.17)
Profit Before Tax 21,068.05 14,875.70 56,258.31 42,359.69
Less: Tax Expense 5,036.83 3,651.10 13,982.53 11,439.38
Profit After Tax 16,031.22 11,224.60 42,275.78 30,920.31
Total Comprehensive income for the year 15,666.24 11,037.56 45,893.31 29,063.53

Companys Performance Overview:

During the financial year 2022-23, LT Foods on a consolidated basis recorded revenue from operations of Rs. 6,93,579.19 lacs 27.79% higher than Rs. 5,42,737.17 lacs in FY 2021-22. Profit before and after tax for the financial year 2022-23 was at Rs. 56,258.31 lacs and Rs. 42,275.78 lacs, respectively as compared to profit before and after tax of Rs. 42,359.69 lacs and Rs. 30,920.31 lacs, respectively for the financial year 2021-22, with an increase of 32.81% and 36.72% in profit before and after tax respectively. On a standalone basis LT Foods recorded revenue from operations of Rs. 3,91,459.99 lacs 37.84% higher than Rs. 2,83,999.61 lacs in FY 2021-22. Profit before and after tax for the financial year 2022-23 was at Rs. 21,068.05 lacs and Rs. 16,031.22 lacs, respectively as compared to profit before and after tax of Rs. 14,875.70 lacs and Rs. 11,224.60 lacs, respectively for the financial year 2021-22, with an increase of 41.63% and 42.82% in profit before and after tax respectively.

For detailed analysis of the financial performance of the Company, please refer to the Management Discussion & Analysis Report, forming part of the Annual Report.

Highlights of performance of Subsidiaries, Associates, Joint Ventures and their contribution to the overall performance of the Company.

A statement providing details of performance and salient features of the financial statements of Subsidiary / Associate / Joint Venture companies, as per Section 129(3) of the Act, are provided in Annexure I.

The companies which have become and /or ceased to be Subsidiary/Associate of the Company during the financial year 2022-23 are also mentioned in Annexure I.

The financial statements of the subsidiaries, as required, are available on the Companys website and can be accessed at http://www.ltgroup.in/index.html.

The Company has formulated a Policy for determining Material Subsidiaries. The Policy is available on the Companys website and can be accessed at http://ltgroup. in/pdf/LT-Foods-Material-Subsidiary-Policy-2021.pdf. DAAWAT Foods Limited (Subsidiary) and LT Foods Americas,Inc.(FellowSubsidiary)arematerialsubsidiaries of the Company, as per the Listing Regulations.

Further, the Annual Accounts and related documents of the subsidiary Companies shall be kept open for inspection at the Registered & Corporate Office of the Company. The Company shall also make available copy thereof upon specific request by any member of the Company interested in obtaining the same. The Consolidated Financial Statements presented by the Company in this Annual Report include the financial information of its subsidiaries.

Share Capital

During the year, the Board of Directors in its meeting held on February 28, 2023, allotted 27,408,164 (Twenty Seven Million Four Hundred Eight Thousand One Hundred and Sixty Four) ("Equity Shares") at face Value of Re. 1/- per Equity Share and Securities Premium of Rs. 141.23/- (Rupees One Hundred and Forty One and Twenty Three Paise) per Equity Share aggregating Rs. 142.23/- (Rupees One Hundred and Forty Two and Twenty Three Paise) per Equity Share amounting to 7.89% (Seven point Eight Nine Percent) of the share capital of the Company on a fully diluted basis for an aggregate subscription amount of Rs. 3,898,263,165.72/- (Rupees Three Billion Eight Hundred and Ninety Eight Million Two Hundred and Sixty Three Thousand One Hundred Sixty Five and Seven Two Paise) equity shares to SALIC International Investment Company ("Salic") a limited liability company duly incorporated under the laws of the Kingdom of Saudi Arabia on Preferential basis. Shareholders, at the Extra Ordinary General Meeting held on December 07, 2022, approved the issuance of securities to SALIC. Post allotment, paid –up share capital of the Company has increased to Rs. 34,72,52,944/- of face value of Re. 1/- each.

Pursuant to the provisions of Regulation 32(4) of the Listing Regulations there are no deviations in the utilization of proceeds from the objects stated in the offer document pertaining to preferential allotment of shares to SALIC.

Reserves

During the financial year, there was no amount proposed to be transferred to the Reserves.

Dividend

The Board of Directors at their meeting held on July 28, 2023, have recommended payment of Rs. 0.50 (50%) per equity share of the face value of Re. 1 /- each as final dividend for the financial year ended March 31, 2023. The payment of final dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting (" AGM") of the Company.

During the year under review, the Board of Directors of the Company at their meeting held on October 31, 2022, declared an Interim dividend of Rs. 0.50 (50%) per equity share of the face value of Re. 1 each. The interim dividend was paid to the shareholders within the stipulated time period. The total dividend amount for the financial year 2022-23, including the proposed final dividend, amounts to Rs. 1.00 (100%) per equity share of the face value of Re. 1 each. In view of the changes made under the Income-Tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the shareholders. The Company shall, accordingly, make the payment of the final dividend after deduction of tax at source, at the rates as prescribed. Further, the Board of Directors at thir meeting held on July 28, 2023, declared an interim dividend of Rs. 0.50 (50%) per equity share of the face value of Re. 1 /- for the financial year 2023-24. The interim dividend shall be paid to the shareholders within the stipulated time period. The dividend recommended by the Board is in accordance with the Dividend Policy of the Company. The Dividend Policy, in terms of Regulation 43A of the Listing Regulations is available on the Companys website: http://www.ltgroup.in/pdf/Dividend-Policy_Final.pdf.

Particulars of Loans, Guarantees or Investments

The particulars of loans given, investments made and guarantees provided by the Company, under Section 186 of the Companies Act, 2013, as at March 31, 2023, are furnished in Annexure – II and forms part of this Report.

Details relating to deposits covered under Chapter V of the Companies Act, 2013

The Company has not accepted any deposits from the public under Chapter V of the Act and, as such, no amount of principal or interest was outstanding as on the balance sheet date.

Directors and Key Managerial Personnel

In accordance with the provisions of Section 152 and other applicable provisions, if any, of the Act and the Articles of Association of the Company, Mr. Ashwani Kumar Arora, Managing Director & CEO of the Company, is liable to retire by rotation at the ensuing AGM and being eligible has offered himself for re-appointment.

A brief resume, nature of expertise, details of directorships held by Mr. Ashwani Kumar Arora in other companies, along with his shareholding in the Company, as stipulated under Secretarial Standard – 2, issued by Institute of Company Secretaries of India, and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.

Your Company and the Board expresses their deep condolences on the untimely and sad demise of Mr. Anil Khandelwal (DIN: 03473632), Independent Director of the Company, on February 22, 2023. Mr. Anil Khandelwal was appointed as an Independent Director of the Company w.e.f. July 22, 2021, during his tenure, he played crucial leadership role which benefitted the Company immensely. Mr. Anil Khandelwals sudden and unexpected demise will be an irreparable loss to the Company and the Company convey deep sympathy, sorrow and condolences to his family. The Board of Directors in its meeting dated February 28, 2023, approved the appointment of Mr. Alrumaih Sulaiman Abdulrahman S (DIN: 09091328) as a Non- Executive Non- Independent Director of the Company. Mr. Alrumaih holds a bachelors & Masters degree in Electrical Engineering from King Saud University, KSA. He has more than twenty years of diverse experience with a focus on Investments, Commercial & Business Development strategy. Throughout his career he was associated with Tamimi Group, as Chief Executive Officer, General Electric (GE) and Saudi Electric Company. Further, the Shareholders approved his appointed through postal ballot process on June 21, 2023.

Further, on the recommendation of the Nomination and Remuneration Committee and the Board of Directors subject to the approval of the shareholders of the Company, Mr. Satish Chander Gupta, (DIN: 00025780) has been appointed as an Independent Director of the Company with effect from June 16, 2023. Mr. Satish Chander Gupta, has a degree of Masters in Commerce and has completed CAIIB from Indian Institute of Banking and Finance. He is having an experience of over 41 years in Banking Industry, is a retired Chairman and Managing Director from Punjab National Bank and had previously held positions of Chairman & Managing Director at Indian Overseas Bank, Chairman at ISMT Ltd. and Kamanwala Housing & Construction Ltd, to name a few. The approval of the shareholders shall be taken through Postal Ballot Process. During the year under review, Mr. Ashwani Kumar Arora resigned from the position of Chief Financial Officer and Mr. Sachin Gupta has been appointed as Chief Financial Officer of the Company effective from May 30, 2022.

Declaration from Directors

None of the Directors of the Company are disqualified from being appointed as Directors, as specified in Section 164(2) of the Act read with Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Declaration by Independent Director(s) and reappointment, if any

The Company has received declarations of Independence as stipulated under Section 149(7) of the Act from Independent Directors confirming that he/she is not disqualified from being appointed/ continuing as Independent Director as laid down in section 149(6) of the Act read with rules related thereto and Regulation 16(1) (b) of Listing Regulations. The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act. The Independent Directors of the Company have registered themselves with the data bank maintained by Indian Institute of Corporate Affairs. They have also confirmed on the compliance of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Board Diversity

The Company recognizes and embraces the importance of a diverse Board in its success. We believe that a truly diverse Board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical backgrounds, age, ethnicity, race and gender, that will help the Company retain its competitive advantage.

Performance Evaluation

InpursuanceofSection178oftheActreadwithRegulation 4(2), 17(10) and 19(4) read with Schedule II Part D of the Listing Regulations and Secretarial Standard-I, the Nomination and Remuneration Committee has framed the evaluation process and the performance evaluation of Independent Directors, Executive Directors and of the Board as a whole as well as working of its Committees has been carried out during the financial year 2022-23.

Performance Evaluation of Individual Directors & Chairman

The Independent Directors of the Company met separately on March 27, 2023 without the presence of Non-Independent Directors and inter-alia reviewed the performance of the Non-Independent Directors, Board as a whole, performance of the Chairman of the Company and the Committees after taking into consideration the views of Executive and Non-Executive Directors.

Performance evaluation of the Board and Committees

In compliance with the provisions of SEBI Listing Regulations, the Board of Directors have also carried out evaluation of every Independent Directors performance during the year. The Board members had submitted to Nomination and Remuneration Committee, their response on a scale from 5 to 1 (Excellent to Performance Needs Improvement) for evaluating the entire Board, Committees including Chairman of the Board.

Evaluation Outcome

It was further acknowledged that every individual Member and Committee of the Board has contributed best in the growth of the organization. It was noted that the Board as a whole is functioning as a cohesive body which is well engaged with different perspectives. The Board has a right balance of discussion between strategic and operational issues. The Board members are from different backgrounds and are enriched by such diversity which brings about different deliberations in the Board and Committee Meetings. The Board is actively engaged on the key issue concerning strategy, talent, risk and governance. It was also noted that the Committees are functioning well and besides the Committees terms of reference as mandated by law, important issues are brought up and discussed in the Committees & the Board was thereafter updated on the same.

FamiliarizationProgrammeforIndependent Directors

The members of the Board of the Company are provided with many opportunities to familiarise themselves with the Company, its management and operations. The Directors are provided with all the documents to enable them to have a better understanding of the Company, its operations and the industry in which it operates.

All the Independent Directors of the Company are made aware of their roles and responsibilities at the time of their appointment through a formal letter of appointment, which also stipulates the terms and conditions of their engagement. Directors are also informed of the various developments in the Company through presentations during the meetings.

Pursuant to Regulation 25(7) of the Listing Regulations, the Company imparted various familiarization programmes for its Directors which includes review of industry outlook, regulatory updates with respect to the Act, Listing Regulations, taxation and other matters by Auditors, Company Secretary and experts, internal control over financial reporting, Prevention of Insider Trading Regulations, framework for related party transactions. Pursuant to Regulation 46 of the Listing Regulations, the details required are available on the website of your Company at the following web link: http://www.ltgroup. in/business-and-investors.html#investor-updates

Directors Responsibility Statement

Pursuant to Section 134(3)(c) of the Act, the Directors to the best of their knowledge hereby state and confirm that:

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

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

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

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

5. 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; and

6. 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.

Particulars of Directors and Employees

The ratio of remuneration of each Director to the median employees remuneration as per Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is disclosed in Annexure III to this report. The statement containing particulars of remuneration of employees as required under Section 197(12) of the Act, read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is available on the Companys website at http://www.ltgroup.in/index.html. Any Member desirous of obtaining a copy of the said annexure may access the aforesaid weblink or write to the Company Secretary at ir@ltgroup.in.

Board and its Committees

In compliance with the statutory requirements, the Company has formulated mandatory Committees viz. Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Risk Management Committee and Stakeholders Relationship Committee. During the year under review, all the recommendations made by the Committees of the Board, including the Audit Committee, were accepted by the Board.

The Board of Directors met six (6) times during the financial year ended March 31, 2023, i.e. on May 30, 2022, July 29, 2022, October 31, 2022, November 11, 2022, January 31, 2023 and February 28, 2023. A detailed update on the Board, its composition, governance of committees including detailed charter, terms of reference of various Board Committees, number of Board and Committee meetings held during the financial year ended March 31, 2023 and attendance of the Directors at each meeting is provided in the Report on Corporate Governance, which forms part of the Annual Report.

Further, the Board of Directors at their meeting held on July 28, 2023, approved the closure of Governance Committee and Capital Raising Committee since these were incorporated for specific reasons and the Company do not anticipate the requirement of these committees in near future.

Audit Committee

The Company has constituted the Audit Committee, in accordance with the provisions of Section 177 of the Act read with Regulation 18 of Listing Regulations. As on March 31, 2023 the Audit Committee comprises of Mr. Abhiram Seth, Mrs. Neeru Singh, Mrs. Ambika Sharma, Independent Directors and Mr. Alrumaih Sulaiman Abdulrahman S, being Non- Executive Non- Independent Director. Company Secretary & Compliance Officer, Chief Financial Officer,StatutoryandInternalAuditorsarethepermanent invitees to the Committee. Further details relating to the Audit Committee, including number of meetings held during the year, are provided in the Corporate Governance Report forming part of the Annual Report. During the year under review, all recommendations made by the Audit Committee were accepted by the Board of Directors.

AUDITORS

Statutory Auditors

M/s MSKA & Associates, Chartered Accountants, (Firm Registration Number 105047W), were appointed as the Statutory Auditors of the Company, for a period of five years, at the 30th AGM of the Company to hold office till the conclusion of the 35th AGM.

The Auditors have issued an unmodified opinion on the financial statements of the Company for the financial year ended March 31, 2023. The said Report of the Auditors is self-explanatory and therefore does not require further comments and explanations. The Auditors Report for the financial year ended March 31, 2023 on the financial statements of the Company forms part of this Annual Report.

Secretarial Auditors

In terms of Section 204 of the Act and Rules made there under, M/s. D Dixit & Associates, Practicing Company Secretary has been appointed as Secretarial Auditors of the Company. M/s. D Dixit & Associates, Company Secretaries, (Certificate of Practice No. 7871), appointed as the Secretarial Auditors, have carried out an audit of the secretarial records of the Company for the financial year 2022-23. The Secretarial Audit Report for the financial year ended March 31, 2023 under the Act, read with Rules made thereunder and Regulation 24A of the Listing Regulations, is set out in Annexure IV to this Directors Report.

Observations/ remarks specified in the said reports alongwith status of the said observations / remarks as on the date of this report are mentioned below: During the Audit Period it was found that Two Designated employees of the Company has violated the code of conduct framed under SEBI (Prohibition of Insider Trading) Regulations, 2015 as they have conduct trading during closure of trading window as well as also done contra trade. Company has issued warning letters to those Designated Persons and have warned them to remain cautious going forward. The requirement of maintaining half of the Board as Independent Director is not met as on March 31, 2023. However, the said requirement was complied by the Company during the quarter ended June 30, 2023.

Pursuant to requirement of Regulation 24A of the Listing Regulations, the Secretarial Audit Report of DAAWAT Foods Limited, material unlisted subsidiary, incorporated in India, of the Company, is annexed to this report as Annexure V to this Report Pursuant to requirement of Regulation 24A of the Listing Regulations, the Secretarial Compliance Report for the financial year ended March 31, 2023, in relation to compliance of all applicable SEBI Regulations and circulars/guidelines issued thereunder, issued by M/s. D Dixit & Associates, Company Secretaries, has been filed with the stock exchanges within the prescribed time limit. Pursuant to the provisions of section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board, on the recommendation of the Audit Committee, have appointed M/s. D Dixit & Associates, as the Secretarial Auditor for the financial year ending March 31, 2024. M/s. D Dixit & Associates, Company Secretaries, have provided a consent to the Company to act as the Secretarial Auditors for conducting the audit of the secretarial records for the financial year ending March 31, 2024, and have also confirmed that their appointment, if made, would be within the limits laid down by the Act and Rules made thereunder and they are not disqualified for being appointed as Secretarial Auditors under the provisions of applicable laws. They have also confirmed that their firm is peer reviewed by The Institute of Company Secretaries of India.

Cost Auditors and Cost Records

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Act read with Rule 3 and Rule 4 of The Companies (Cost Records and Audit) Rules, 2014, are not applicable for the business activities carried out by the Company.

Reporting by Auditors

During the year under review, the Statutory Auditors and the Secretarial Auditors have confirmed that they have not come across any event indicating commitment of any fraud by the officers or employees of the Company and thus, no reporting under the provisions of section 142(12) of the Act and the Rules made thereunder was required.

Internal Auditor

In terms of compliance of Section 138 of the Act read with the Companies (Accounts) rules, 2014, the Board of Directors on the recommendation of Audit Committee approved the appointment of Grant Thornton, Bharat LLP as its Internal Auditors of the Company for reporting year 2023-24.

Sustainability Journey

The Environment, Social and Governance ("ESG") components are factors that help ascertain both investment decisions and risk management with a lens of sustainability within the organization. The primary objective is to build a culture that encourages, promotes and achieves ethical business conduct which is more environmentally and socially conscientious, while adhering to prescribed/ applicable rules and regulations, and are more likely to sustainably succeed in the long run. During the financial year 2022-23, the Company undertook a comprehensive materiality assessment exercise to gather insights on emerging ESG issues that may impact its business in the future. The objective was to assess the Companys current status as an organization basis the worldwide tested parameters of ESG Key Performance Indicators and to lay down the road map for future actions to effectively contribute in achieving the global vision of considerably reducing carbon footprint.

The Company relentlessly strives to provide long-term sustainable value to all its stakeholders including customers, investors, suppliers, employees, government & regulatory bodies and communities. The Company has formulated an ESG Policy to monitor and regulate its ESG initiatives which has been uploaded on the website of the

Company and can be accessed at: http://www.ltgroup.in/ pdf/ESG-Policy.pdf. During the financial year 2022-23, the Board renamed the Corporate Social Responsibility Committee as CSR & ESG Committee w.e.f May 30, 2022, to discharge its oversight responsibility on matters related to organization-wide ESG initiatives, priorities, and leading ESG practices. The CSR & ESG Committee reports to the Board and meets on regular intervals to review progress on the ESG initiatives undertaken by the Company.

Business Responsibility and Sustainability Report (BRSR)

In November 2018, the Ministry of Corporate Affairs ("MCA") constituted a Committee on Business Responsibility Reporting ("the Committee") to finalize business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct. Through its report, the Committee recommended that Business Responsibility Report be replaced with BRSR, where disclosures are based on ESG parameters, compelling organizations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. The BRSR disclosures forms part of this Annual Report, which would follow the format detailed in the amendment to Regulation 34(2) (f) of Listing Regulations vide Gazette notification no. SEBI/LAD-NRO/GN/2021/22 dated May 05, 2021 and will form a part of this Annual Report. The BRSR for the financial year 2022-23 is aligned with the nine principles of the National Guidelines on Responsible Business Conduct notified by the Ministry of Corporate Affairs, Government of India. We have further enhanced our existing strong reporting structure and mechanisms to ensure we capture reliable and accurate data for the requirements of BRSR disclosures.

Corporate Governance Certificate

Your Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance requirements set out by the Securities and Exchange Board of India. The report on Corporate Governance as stipulated under the Listing Regulations forms part of this Annual Report. Your Company has duly complied with the Corporate Governance requirements as set out under Chapter IV of the Listing Regulations. CS Debasis Dixit, Practicing Company Secretary, vide their certificate dated July 10, 2023, has confirmed that the Company is and has been compliant with the conditions stipulated in the Chapter IV of the Listing Regulations except that the Board composition of the Company, as on March 31, 2023, did not met the criteria specified under Regulation 17(1) of the Listing Regulations. The said certificate is annexed to the Corporate Governance Report forming part of this Annual Report. A Certificate of the CEO and CFO of the Company in terms of Listing Regulations, inter-alia, confirming the correctness of the financial statements and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee, is also annexed to the Corporate Governance Report.

Management Discussion and Analysis Report

Pursuant to Regulation 34 of the Listing Regulations, the Management Discussion and Analysis Report for the year under review is presented in a separate section forming part of this Annual Report.

Corporate Social Responsibility

In terms of the provisions of section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014 and any amendment thereof, the Board of Directors of your Company has constituted a Corporate Social Responsibility ("CSR") Committee which has been renamed as CSR & ESG Committee w.e.f. May 30, 2022. The said Committee is chaired by Mrs. Neeru Singh, Independent Director. The other members of the Committee are Mr. Abhiram Seth, Independent Director, Mr. Vijay Kumar Arora, Managing Director and Mr. Ashwani Kumar Arora, Managing Director & CEO. Further, Mrs. Monika Chawla Jaggia, Company Secretary & Compliance Officer and Mr. Sachin Gupta, Chief Financial Officer are the permanent invitees to the Committee. Further details relating to the CSR & ESG Committee, including number of meetings held during the year, are provided in the Corporate Governance Report forming part of the Annual Report.

The CSR & ESG Committee confirms that the implementation and monitoring of the CSR Policy was done in compliance with the CSR objectives and Policy of the Company. The Companys CSR Policy and annual report on the CSR activities undertaken during the financial year ended March 31, 2023, in accordance with Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 ("CSR Rules") is set out in Annexure VI to this Report. The CSR Policy of the Company is available on its website viz. http://www. ltgroup.in/pdf/LT-Foods-CSR-Policy-2021.pdf.

Your Company is a caring corporate entity and lays significant emphasis on development of the communities around which it operates. During the year, on the recommendation of the CSR & ESG Committee and as approved by the Board, your Company has executed several projects in the areas of Trainings to the farmers with sustainable farming practices, water conservation, Education, Health Care, Girl Child Education, village adoption. As per section 135 of the Act, read with CSR

Rules, companies are required to spend minimum 2% of their average net profit for the last three financial years. Basis which the minimum requirement for the Company was Rs. 2.73 crores for the financial year 2022-23.

Risk Management

Risk management is embedded in Companys operating framework. The Company believes that risk resilience is key to achieving higher growth. To this effect, there is a process in place to identify key risks across the functions and prioritise relevant action plans to mitigate these risks. To have a more robust process, the Company had constituted a Risk Management Committee to focus on risk management, including determination of the Companys risk appetite, risk tolerance and regular risk assessments (risk identification, risk quantification and risk evaluation).

The Risk Management Framework is reviewed periodically by the Risk Management Committee, which includes discussing the management submissions on risks, prioritising key risks and approving action plans to mitigate such risks. The objective of the Companys Risk Management Policy is to have a well-defined approach to risk. The policy lays down broad guidelines for timely identification, assessment, and prioritisation of risks affecting the Company in the short term and in the foreseeable future. The policy suggests framing an appropriate response action for the key risks identified, so as to make sure that the risks are adequately addressed or mitigated. Details of the Committee including number of meetings held during the year, are provided in the Corporate Governance Report forming part of the Annual Report.

Details on risk management forms part of the Management Discussion and Analysis Report under the section ‘Opportunities & Threats, which forms part of this Annual Report. The Company has in place a comprehensive Risk Management Policy which has been uploaded on the website of the Company and can be accessed at http:// ltgroup.in/pdf/LT-Foods%20-Risk-Management.pdf.

Internal Financial Controls

The Company has adequate Internal Financial Control System over financial reporting which ensures that all transactions are authorized, recorded, and reported correctly in a timely manner. The Companys Internal Financial Control over financial reporting is designed to provide reliable financial information and to comply with applicable accounting standards.

The Company periodically tracks all amendments to Accounting Standards and makes changes to the underlying systems, processes and financial controls to ensure adherence to the same. All resultant changes to the policy and impact on financials, if any, are disclosed after due validation with the Statutory Auditors and the Audit Committee.

Your Company has in place adequate internal financial controls with reference to the Financial Statements commensurate with the size, scale and complexity of its operations. Such controls have been assessed during the year under review 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. Based on the results of such assessments carried out by the management, no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Obligation of Company under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company believes that every employee should have the opportunity to work in an environment free from any conduct which can be considered as sexual harassment. The Company is committed to treating every employee with dignity and respect. The Company has formulated a policy on ‘Prevention of Sexual Harassment at Workplace Policy as per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder. The policy is applicable to all the establishments of the Company located in India. The Company has constituted Internal Complaints Committees to ensure implementation and compliance with the provisions of the aforesaid Act and the Rules.

This Policy addresses the following major objectives:

• To define Sexual Harassment;

• To lay down the guidelines for reporting acts of Sexual Harassment at the workplace; and

• To provide the procedure for the resolution and redressal of complaints of Sexual Harassment.

The policy lays down a detailed procedure for making a complaint, initiating enquiry therein and satisfactory redressal of the complaint. During the financial year 2022-23, no complaint was reported under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder and none was pending from the previous financial year.

Whistle Blower Policy / Vigil Mechanism

Company encourages an open and transparent system of working and dealing amongst its stakeholders. LT Foods has adopted a ‘Whistle Blower Policy which encompasses a comprehensive framework of managing complaints of every stakeholder. It encourages its employees and various stakeholders to raise concerns about illegal / unethical behaviour observed in the Company, compromise / violation of Companys Code of Conduct or legal or regulatory provisions, corruption, misuse of office, actual or suspected fraud and other malpractices detrimental to the interest of the Company without any fear of reprisal, discrimination, harassment or victimization of any kind.

The policy also covers reporting of instances of leakage/ suspected leakage of unpublished price sensitive information which are in violation to SEBI (Prohibition of Insider Trading) Regulations, 2015 and the Companys Code of Conduct for Regulating, Monitoring and Reporting Trading by Designated Persons. Complaints, if any, are received by the Ombudsman through a dedicated email ID or by way of letter addressed to the Ombudsman. In case the whistle blower wishes to raise a complaint directly to the members of the Audit Committee, and not through above mentioned normal channels, the complaint may be directly made to the Chairperson of the Audit Committee.

Details of whistle blower complaints received, if any, and the functioning of the whistle blower mechanism are reviewed periodically by the Audit Committee. No person has been denied access to the Chairperson of the Audit Committee. During the financial year 2022-23, no complaint was received under the Whistle Blower Policy of the Company. Details of whistle blower policy are available in the Corporate Governance Report that forms part of this Annual Report.

The Whistle Blower Policy is available on the website of the Company at the link http://ltgroup.in/pdf/Whistle-Blower%20Policy_August%202021.pdf.

Nomination and Remuneration Policy

The Nomination and Remuneration Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall: • lay down the effective manner of performance evaluation of the Board, its Committees and the Directors • formulate the criteria for Board membership, including the appropriate mix of Executive & Non-Executive Directors and Board Diversity;

• approve and recommend compensation packages and policies for Directors, Key Managerial Personnel and Senior Management Personnel; and • such other matters as provided under section 178 of the Act and under the provisions of Listing Regulations.

The salient features of the Nomination and Remuneration Policy of the Company are outlined in the Corporate Governance Report which forms part of this Annual Report. The Policy is available on the website of the Company at: http://www.ltgroup.in/pdf/LT-Foods-Remuneration-Policy.pdf.

Particulars of contracts or arrangements with Related Parties

All arrangements/ transactions entered into by the Company with its related parties during the financial year 2022-23 were in the ordinary course of business and on an arms length basis. During the year under review, the Company had taken shareholders approval for all the arrangement/ transaction with related parties which could be considered material in accordance with the Companys Policy on Related Party Transactions, as amended, read with the Listing Regulations. As per the requirements of Indian Accounting Standards 24, details of all the transactions of the Company with its related parties have been disclosed in the financial statements forming part of this Annual Report. A declaration in Form AOC-2, as required under sections 134(3)(h) read with 188(1) of the Act is enclosed as Annexure VII to this report. The Policy on the Related Party Transactions is available on the Companys website at: http://www.ltgroup.in/pdf/LT-Food-Related-Party-Transactions-2022.pdf. A detailed note on the procedure adopted by the Company in dealing with contracts and arrangements with related parties is provided in the Report on Corporate Governance, which forms part of this Annual Report.

Compliance with the provisions of Secretarial Standards

The mandatory Secretarial Standards issued by the Institute of Company Secretaries of India, have been duly complied with by the Company, during the year under review.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo

The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under section 134(3) of the Act read with Rule 8 of Companies (Accounts of Companies) Rules, 2014 is as follows:

1. Bringing Maximum Control into System through Process Automation

We have strategized the implementation of plant automation using SCADA across our primary packing and processing facilities. This aims to uphold optimal efficiency and quality while minimizing the slightest possibility of manual errors.

2. Section wise Efficiency Improvement Projects

We are actively engaged in executing multiple in-house projects aimed at enhancing efficiency. These projects encompass areas such as loading optimization, minimizing concealed wastage tied to manpower and materials, optimizing power consumption, introducing high-efficiency machinery along with IE4 motors, and maximizing the utilization of renewable energy sources.

3. Inclusion of Bar Codes for improved planning & traceability

We have incorporated Bar Codes as a pivotal tool and are striving to uphold seamless production planning and comprehensive traceability from the production process to invoicing. This initiative will enable us to monitor even the slightest discrepancies and ensure accurate scheduling and thorough traceability.

4. 2nd stage of Digitization

We embarked on our journey towards digitization a year ago and have now progressed to the second phase with the valuable assistance of our esteemed consultants in the field.

5. Using by-product (Husk) for electricity generation

By harnessing green energy from a turbine that utilizes husk a by product for the Company, to generating an impressive capacity of 3.5 MW per hour, resulting in minimum utilisation of electricity.

6. Renewable (Solar) Energy Generation

Company with the help of solar panels have been able to generate solar energy of approx. 5,00,000 KWH on a yearly basis, resulting in energy conservation and reduction in green house gas emissions.

7. Rain Water Harvesting increased

Company has installed a new rainwater harvesting well and constructed a pond within its plant premises, with an aim to significantly increase its capacity of rainwater harvesting and enhancing groundwater recharge capacity. Consequent to which water stress level will be reduced and will help in restoring the land with rain water.

8. Technology / Machine modification

Company has been working towards implementing advanced energy-efficient technologies by installing synchronization meters to effectively manage the power generated from DG (Diesel Generator), turbines, and solar sources. This has resulted in energy saving and productivity improvement in the operations of the Company.

9. Electric Fork Lift introduced

During the year under review, Company has replaced Diesel Operated Fork Lift with Battery Operated fork lift which has impacted in reducing Fossil fuel consumption and air emission inside the plant premises, making it a healthier environment for the plant workforce.

10. New Plantation in Factory Land

Company has taken an initiative of building a mini forest in approx. 2 acers of land within the Company premises for creating a healthier environment within the factory premises and taking a step in contributing towards Companys ESG Targets.

Foreign Exchange Earnings and Outgo:

During the year, the total foreign exchange spent was depicted below in Lakhs and the total foreign exchange earned were as follows: Lakhs

Lakhs
Particulars 31-03-2023 31-03-2022
Value of imports on CIF basis
Capital goods 11.20 96.44
Stores and spares 910.72 14.71
Rice 106.99 -
Packing Material - 20.86
Other 4.62 -
Other Food Items - -
Total 1,033.54 132.00
Expenditure in foreign currency
Legal & Professional 102.66 16.79
Interest and other charges to bank 53.96 281.38
Clearing & Forwarding Expense 6,238.37 5,968.80
Advertisement 78.27 -
Sales promotion 61.94 187.12
Commission on export sales 124.08 284.92
Others 17.71 107.31
Total 6,676.99 6,846.32
Earnings in foreign currency
FOB value of exports 1,52,053.80 1,18,787.69
Total 1,52,053.80 1,18,787.69

Change in the nature of business

There is no change in the nature of the business operations of the Company, during the financial year ended March 31, 2023.

Material changes and commitments, if any, affecting the financial position between the end of the financial year and the date of Report.

There are no material changes and commitments, affecting the financial position of the Company between the end of the financial year ended March 31, 2023 and the date of this Report. Except that a Step-Down wholly owned subsidiary company of LT Foods Limited in the name of "LT Foods UK Limited" has been incorporated on July 17, 2023 to expand and strengthen our presence in United Kingdom.

Investor Education and Protection Fund

In accordance with the applicable provisions of the Act read with Investor Education and Protection Fund (Accounting, Audit, Transfer, and Refund) Rules, 2016 ("IEPF Rules"), all unclaimed dividends are required to be transferred to the Investor Education and Protection Fund ("IEPF") after completion of seven consecutive years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven consecutive years or more shall be transferred to the demat account of the Investor Education and Protection Fund Authority ("IEPF Authority"). After the transfer, the concerned shareholders can claim the said sharesalongwiththedividend(s)bymakinganapplication to IEPF Authority in accordance with the procedure available on www.iepf.gov.in and on submission of such documents as prescribed under the IEPF Rules. On receipt of the application, the Company shall send an online verification report to the IEPF Authority after verifying all the necessary details which is duly certified by the Nodal Officer. All corporate benefits accruing on such shares including dividend shall be credited to IEPF. During the year under review, unpaid or unclaimed dividend amounting to Rs. 2,42,315.50/- in respect of shares transferred earlier to IEPF Authority, was transferred by the Company to the IEPF, established by the Government of India.

The dividend declared for the financial year 2015-16, is due to be transferred to IEPF account during the financial year 2023-24.

The Company has been regularly sending communications to members whose dividends are lying unclaimed requesting them to claim their outstanding dividend amount by providing/updating their bank details with the RTA/Company/ Depository Participant, as the case may be so that their dividend amount do not remain unclaimed for seven consecutive years and thus attracting the provision of transferring the corresponding shares to IEPF Authority. Further the amount of Dividend unclaimed/unpaid are lying in the respective unpaid / unclaimed dividend accounts and can be claimed by the respective shareholders by sending required documents to the Companys Registrar and Share Transfer Agent (RTA) i.e. Big Share Services Private Limited, before the due date of transferring the same in IEPF account.

Annual Return

A copy of the Annual Return of the Company containing the particulars prescribed under section 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, as amended, in Form MGT-7, as they stood on the close of the financial year i.e. March 31, 2023 is uploaded on the website of the Company and can be accessed through the following link: http://ltgroup.in/investor-updates/ annual-return.html.

Details of significant and material orders passed by the regulators or courts

During the financial year 2022-23, no significantly material order was passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in the future.

Affirmations

To the best of our knowledge and the information available, no application against the Company was filed in any court in India under the Insolvency and Bankruptcy Code, 2016, nor any proceedings thereunder is pending as on March 31, 2023.

During the year under review, there was no instance of onetime settlement with any bank or financial institution.

Acknowledgements

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The Board places on record its appreciation for the support and co-operation your Company has been receiving from all its business partners - suppliers, distributors, retailers and others associated with it. Your Company looks upon them as partners in progress and share with them the rewards of growth. Your Directors also express their sense of gratitude to all the shareholders, customers, vendors, banks and regulatory authorities, both at the Central and State level, and look forward to their continued support.

For and on behalf of
Board of Directors of LT Foods Limited
Gurugram, Vijay Kumar Arora
July 28, 2023 Chairman and Managing Director