morganite crucible india ltd share price Management discussions

To,

The Members of

Morganite Crucible (India) Limited

Your Directors are pleased to present herewith the 38^th Boards Report, together with the Audited Financial Statements of the Company for the financial year ended March 31, 2023.

FINANCIAL PERFORMANCE:

Particulars	2022-23	2021-22
Revenue from	15,459	15,235
Operations
Other income	483	2,896
Total income	15,942	18,131
Operating Expenses	12,934	12,253
Profit before finance cost, depreciation and amortisation	3,008	5,878
Depreciation and Amortisation Expense	776	740
Profit before tax	2,232	5,138
Provision for tax	620	1,109
Exceptional Item	-	(310)
Profit after tax	1,612	4,339
(Loss)

DIVIDEND:

The Board of Directors in their meeting held on November 10, 2022, has paid an interim dividend of Rs. 9/- per share to the equity shareholders of the Company as on record date of November 23, 2022. In view of performance recorded by the Company as of March 31, 2023, your Directors are pleased to recommend a final dividend of Rs. 11/- per share to the equity shareholders of the Company as on record date of August 22, 2023.

ThedividendrecommendedisinaccordancewiththeCompanys Dividend Distribution Policy. The Dividend Distribution Policy of the Company is available on the Companys website and can be accessed at https://www.morganmms.com/en-gb/investors/

FINANCIAL PERFORMANCE:

The Company revenue from Operations for the financial year 2022-23 was Rs. 15,459/- lakhs, as against Rs. 15,235/- lakhs in the previous year. The gross profit before tax and depreciation was Rs. 3,008/- lakhs as against Rs. 5,878/- lakhs in the previous year. The operating expenses increased to Rs. 12,934/- lakhs as against Rs. 12,253/- lakhs the previous year.

At start of January-2023, Morgan Advanced Materials Plc, the ultimate holding entity had encountered a cyber incident on their IT systems. Although, the Company has separate IT systems and infrastructure in India, as an immediate precautionary measure, basis advice from ultimate holding entity, the Company had temporarily shut down access to IT systems for security reasons which led to temporary disruption in some of the Companys business activities. The Company had put in place alternative control mechanism in the absence of the access to the said systems. Based on the investigation carried out by the ultimate holding company at group level, the said systems were restored in a phased manner after taking all the possible necessary measures and it was concluded that there was no impact on the Companys IT systems and infrastructure.

As per the Companys assessment there was no impact on the financial results of the Company for the year ended March 31, 2023 due to cyber incident at the ultimate holding entity level.

Further, no other material changes or commitments have occurred between the end of the financial year and the date of this Report which affect the financial statements of the Company in respect of the reporting year.

ECONOMIC SCENARIO AND BUSINESS OUTLOOK:

Indias economic growth continues to be resilient, and it will continue to be one of the fastest growing economies in the G20 in coming year despite decelerating global demand and the tightening of monetary policy to manage inflationary pressures, the latest being the liquidity troubles after a series of global bank crises. While Indian GDP growth may slow down to less than 6% in FY 2023-24, demand may continue to be driven by private consumption and private investment on the back of government policies to improve transport infrastructure, logistics, and the business ecosystem. This should create a positive business outlook for the Company in the Indian market for the coming year.

The global economy growth is expected to slow down in coming year due to geopolitical impacts, continued high inflation and changes in monetary policy. The European markets already continue to show stagnation in demand, Chinas manufacturing output is weak, and there is fear of industrial slowdown in the USA. In view of weak global growth sentiments, and continued changes in monetary policy, a more pronounced slowdown or global recession this year is a distinct possibility. Therefore, the Companys export business outlook may be weaker than in recent years, as we look to take advantage of opportunities created by our customers seeking to diversify their global supply chains.

NDIAN FOUNDRY INDUSTRY INSIGhT:

In the last few years, the world economy has suffered a lot of volatility due to the impact of the global pandemic of Covid-19 and the metallurgical industry is no exception. Although the metal production has come down in last few months, it increased rapidly post-pandemic and exhibited strong recovery in steel & metals industry. However, in the last year, the metal industry experienced setbacks due to Russia Ukraine war resulting in corporates facing issues in raw material availability and input prices also increased multi fold therefore leading to increased prices of finished products. Due to sanctions imposed by EU, it was difficult to trade with Russia, leading to adverse effects on several companies, including MCIL.

Given the weakening international backdrop, the Indian governments vision on expanding infrastructure projects and development of railways network including metros across the country translated into a huge demand for metals and foundry products which will certainly give a big a boost to the metal manufacturing and processing industry in the country.

Further, in todays time, governments all over the world are encouraging the electric vehicle (EV) industry through various regulations and incentives to meet the consumer demand for low emission commuting instead of the fossil fuel driven vehicles that are endangering our planet.

The Indian Government has also announced number of promotional measures in the last few years including tax incentives for electric vehicle owners, public EV charging infrastructure development etc. which will help to transform mobility and phased manufacturing programme for EV, its components and batteries in coming years.

In view of above, your Company is committed to deliver great value through our products and technical services to retain ‘Morgan as the preferred supplier to the non-ferrous metals industry. Your Company will continue its focus on providing value added services to their customers for their next generation of products and processes.

ENVIRONMENT, hEALTh AND SAFETY (EhS):

At Morgan Advanced Materials we are committed to a sustainable future. Our aim is to ensure that our products and manufacturing processes are designed, built and managed in a way that enhances their value to society and our environment. We are working towards our aspiration of ‘zero harm to all our employees. We are committed to conducting all our activities in a manner that builds a caring safety culture and develops a world-class safety system that supports this effort.

There was no lost time accident reported on the site during the year, the lost time incident frequency rate is zero as compared to previous years 0.1. Further, there were 9 first-aid injuries and 12 significant near misses reported and immediate actions were taken on the observations of unsafe actions and unsafe conditions. The non-LTI incident frequency rate is 0.8 as compared to the earlier years 1.1. We are regularly monitoring air, water and soil quality in the factory premises and corrective measures are being taken for any readings that are over the limit. We are also regularly focused on our 6S drive in the factory.

‘ T hINKSAFE

At Morgan Advanced Materials, ‘thinkSAFE is a mindset. This means we approach every moment of every working day with safety in mind. We do this by being curious, not complacent, by looking out for each other and by speaking up about safety issues. We consider safety in everything that we do because we care.

The six Morgan ‘thinkSAFE commitments provide guidance on how we should behave and remind us that:

During the year, we conducted ‘thinkSAFE refresher training programme for all shop floor workers, staff employees and agency employees.

Operational, health and Safety Improvements:

- Modification & automation of all 3 LPG bullets

- Installed fire sprinkler system in old & new logistics area

- Various automation projects improving productivity has been completed.

- Received PESO permission for use of new LPG yard.

- Automation project completed for CIP line wash booth conveyor, mould pulling activity and sizzler lift arrangement.

- Installed sieving machine for CIP floor dust.

Employee Well-being:

- Organised COVID-19 Booster Vaccination camp to all third parties, employees, shop floor workers and their family members

- Organised first aid trainings, health awareness session for all employees, workplace monitoring

Expansion Project

Project Avatar – Phase II

As of year end, your Company has completed the entire project activity including installation of required plant and machineries at site which were relocated from Mehsana plant and has obtained regulatory approval from respective government departments. With the completion of this project, we will be able to deliver high-quality products and services within expected timelines.

We acknowledge the collaboration and teamwork that took place throughout the project by each team member which was essential to achieving our goals.

PRODUCT QUALITY AND CERTIFICATIONS:

Morgans purpose is to use advanced materials to help make more efficient use of the worlds resources, and to improve the quality of life. This comes down to the engineering of high-performance materials and specialized products that offer reliable solutions to the technical challenges that our customers have, and we are committed to help our customers achieve more by using our quality of products and services. The quality objective we measure and strive to continuously improve product quality, reliability, and durability. In order to improve customer satisfaction, our technical services and product team encourages in constant communication with customers, suppliers and employees, carries out continuous development and refinement of new designs, products and applications and enhancement of technical specifications and support services.

Morgans global footprint enables the company to supply a customers needs anywhere in the world, which means local and global expertise that Morgan can leverage, which we are keen to demonstrate. Your Company is equipped with wide range of engineering capabilities, specialist engineering teams and all required installation support to help customer to gain maximum benefits from the Morgans product. We continuously review and analyse manufacturing quality parameters for improvement of overall quality of the product. This purpose, guides our actions, aiding our efforts to work with our environment, informs how we treat our people and ensures we fulfil our responsibility of good corporate governance.

Your Company has made below improvements during the year -

1. Mixing automation for accurate addition of mix components.

2. Crucible pulling automation in the Sigma section for better material handling & reduce damages during operation.

3. Sieving automation in sigma section for reliable sieving of material

4. Dust collector commissioned for the Sigma rotary dryer section.

5. Oil based paint replaced with environmentally friendly water-based paint for crucible finishing.

ChANGES IN ShARE CAPITAL

The paid-up equity share capital of the Company stood at Rs. 280 lakhs as on March 31, 2023. During the year, the Company has not issued any shares or convertible securities and does not have any Scheme for issue of shares including sweat equity to the employees or Directors of the Company.

RELATED PARTY TRANSACTIONS:

All related party transactions entered during the year were on arms length basis and in the ordinary course of business. In compliance with the provisions of Section 188 of Companies Act, 2013 and Regulation 23 of Securities Exchange Board of India (‘SEBI) (Listing Obligations and Disclosure Requirements), (‘Listing Regulations) Regulations, 2015, the Audit Committee had given omnibus approval for related party transactions that were repetitive in nature and conducted with Morgan Group subsidiary companies for the sale and purchase of goods and services for a period of one year. The Company has also obtained approval of the members for material related party transactions which expects to exceed threshold limit based on annual turnover. The Audit Committee reviewed the current details of the related party transaction on a quarterly basis.

Further, there were no materially significant related party transactions entered into by the Company with the Promoters, Directors, Key Managerial Personnel or others, which may raise a potential conflict of interest with the Company or requires approval of the shareholders. The Company has not given any loans and advances to any associate company or to firms/companies in which the directors have interest hence disclosure as per Regulation 34(3) of Listing Regulations is not applicable. During the fiscal year 2022-23, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company.

In accordance with Section 134 of the Companies Act, 2013 and Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of the contract or arrangement entered into by the Company with related parties referred to in Section 188(1) in Form AOC-2 is attached as Annexure - I of this report.

As per Regulation 46 of SEBI Listing Regulations, the Policy on Materiality of Related Party Transactions and dealing with Related Party Transactions is available on Companys website at http://www.morganmms.com/en-gb/investors/

MATERIAL ChANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN ThE END OF ThE FINANCIAL YEAR AND DATE OF REPORT:

During the year under review, there have been no other material changes or commitments made which affect the financial position of the Company between the end of the financial year and the date of the report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the year under review, the Company have not provided any loans, given guarantees and made investments covered under Section 186 of the Companies Act, 2013.

BOARD OF DIRECTORS:

As reported in the previous year, Mr Jonathan Percival (DIN: 09701284), was appointed as an Additional Non-executive Director on the Board of the Company effective from August 12, 2022 and regularised in the 37^th Annual General meeting of the Company held on September 27, 2022. Mr Nitin Sonawane (DIN: 09701207) was appointed as an Additional Executive Director on the Board of the Company and also nominated as Manager of the Company within the meaning of Section 2

(53) of the Companies Act, 2013 read with Section 203 and Rule 8 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 effective from August 12, 2022.

Pursuant to approval of members in the 37^th Annual General Meeting held on September 27, 2022, Mr Nitin Sonawane (DIN: 09701207) was designated as ‘Manager & Director of the Company effective from August 12, 2022 until August 11, 2025 on the terms and conditions of appointment as contained in the agreement entered into with him effective from abovementioned date, at a remuneration as may be mutually decided between the Company and Mr Nitin Sonawane.

In accordance with provisions of Companies Act, 2013 and the Article of Associations of the Company, Mr Aniruddha Karve, Non-Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.

In the opinion of the Board, all our Independent Directors possess requisite qualifications, experience, expertise and hold high standards of integrity for the purpose of Rule 8(5)(iii)(a) of the Companies (Accounts) Rules, 2014. The independent directors have submitted certificate of independence under Section 149 (6) (d) of the Companies Act, 2013. The policy on the familiarisation program for Independent Directors including details of Nomination & Remuneration Committee and their roles and responsibility are provided in the Corporate Governance Report. The evaluation of Board including independent directors was carried out based on parameters of attendance in every Board and Committee meeting, participation in discussions and independent judgement.

The details of the familiarization program for Independent Directors are posted on the website of the Company and can be accessed at - http://www.morganmms.com/en-gb/ investors/

KEY MANAGERIAL PERSONNEL:

In terms of Section 203 of the Companies Act, 2013, the following officials are ‘Key Managerial Personnel of the Company during the financial year ending March 31, 2023 –

1. Mr Nitin Sonawane – Manager

(Appointed effective from August 12, 2022)

2. Mr Hanumant Mandale – Chief Financial Officer

3. Mr Rupesh Khokle – Company Secretary

BOARD EVALUATION

As per Regulation 17(10) of Listing Regulations and Section 178 of the Companies Act, 2013, the annual evaluation process of the Board of Directors, as individual Directors and the Board as a whole was carried out based on criteria such as participation and contribution in Board and Committee meetings, enhancing shareholder value, experience and expertise to provide feedback, and guidance to top management on business strategy, governance, risk and understanding of the organizations strategy.

The entire Board has actively participated in every Board and Committee meeting with focus on adherence of corporate governance norms. Based on the outcome of the evaluation and feedback of the Directors, the Board and the Management have agreed on the way forward which includes strategic engagement with alignment of Morgan group long term strategic plan.

BOARD MEETINGS AND ANNUAL GENERAL MEETING:

During the financial year 2022-23, the Board met four times, the details of which are mentioned in the Corporate Governance Report. The necessary quorum was present in all the Board and Committee meetings during the year. The 37^th Annual General Meeting was held on September 27, 2022. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013.

PARTICULARS OF EMPLOYEES:

During the year under review, no employee was in receipt of remuneration of Rs. 102 lakhs or more or employed for part of the year and in receipt of Rs. 8.50 lakhs or more a month, under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

A Statement containing particulars of top 10 employees is provided in the Annexure forming part of this report. In terms of proviso to Section 136(1) of the Act, the Report and Accounts are being sent to the Shareholders, excluding the aforesaid Annexure. The said Statement is also open for inspection. Any member interested in obtaining a copy of the same may write to the Company Secretary.

PREVENTION OF SEXUAL hARASSMENT AT WORKPLACE:

The Company has formulated an Internal Complaints Committee, under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has mechanism in place to report sexual harassment cases at workplace.

Your Company has organised workshops and awareness programmes against sexual harassment for employees of the Company. During the year, the Company has not received any complaint with allegations of sexual harassment.

RISK MANAGEMENT POLICY:

The Board of Directors established risk management methodology which seeks to identify, prioritise and mitigate risks, underpinned by a ‘three lines of defence model comprising an internal control framework, internal monitoring and independent assurance processes.

The Board considers that risk management and internal control are fundamental to achieving the Morgan Groups aim of delivering long-term sustainable growth. The Risk Framework covers business, operational and financial risks reviewed by the Committee on a periodic basis. The severity of each risk is quantified by assessing its inherent impact and mitigated probability to ensure that the residual risk exposure is understood and prioritised for control to avoid future implications.

During the year, the Board reviewed the status of all principal and emerging risks with a significant potential impact on the Company performance. These reviews included an analysis of both the principal risks and emerging risks, together with the controls, monitoring and assurance processes established to mitigate those risks to acceptable levels. As a result of the review, the number of actions were identified to continue to improve internal control and management of risks including improvement on safety and ethics of the Company.

The Committee met on two occasions on November 10, 2022 and February 13, 2023 and reviewed risk relating to competition, operations, people management and development, product quality, technological obsolescence, quality of contract, compliances, tax related matters, macroeconomics & political environment and development of action plan as prepared by the management for mitigating such risks relating to above risks in the future.

CORPORATE SOCIAL RESPONSIBILITY (CSR):

Your Company believes in contributing to create equitable and sustainable society by way of undertaking various CSR activities and sustainability initiatives. During the year your Company sponsored to vocational skill development programme, provided school kits, uniforms and other basic amenities to orphaned students. Further, the Company with the help of local NGO developed a green belt with plantation of around one thousand indigenous, rare and medical plants in the nearby industrial area and committed to regular enrichment of the plants in coming years.

In compliance with the provisions of Section 135 of the Companies Act, 2013, during financial year 2022-23, your Company has fully spent the entire amount that is required to be spent under CSR guidelines.

The Corporate Social Responsibility policy formulated by the Company is available on the website of the Company at - http://www.morganmms.com/en-gb/investors/

The CSR activities as undertaken by the Company are attached as Annexure – II and form part of this annual report.

NOMINATION AND REMUNERATION COMMITTEE:

The Nomination and Remuneration Committee has been vested with the authority to, inter alia, recommend nominations for Board Membership and senior management position of the Company and establishing criteria for selection to the Board with respect to the competencies, qualifications, experience, integrity and succession plans. The committee comprises of independent and non-executive directors of Board which details are given in Corporate Governance Report.

The policy of the Company on directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Section 178 (3) and Section 197 (12) of the Companies Act, 2013, read with Rule 5 of Companies (Appointment And Remuneration of Managerial Personnel) Rules, 2014 is available on the website of the Company at - http://www.morganmms.com/en-gb/investors/

During the year, the Nomination and Remuneration Committee met 2 times on May 25, 2022 and August 12, 2022.

The details of remuneration to Directors & KMP and other details as prescribed is given as Annexure – III to this report.

CORPORATE GOVERNANCE:

Your Company is always striving long-term sustainable success for the shareholders of the Company by adopting best practices of corporate governance which are aligned with Morgans Group purpose and strategic direction.

As per Regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from Deloitte Haskins

& Sells LLP, Chartered Accountants, on compliance with corporate governance norms under the Listing Regulations, is provided with this report.

CODE OF CONDUCT

While the Morgan Code is applicable to all level of employees, the Board of Directors as per Schedule IV of the Companies Act and Regulation 26 of the Listing Regulations have adopted for all Board members, key managerial personnel and senior management. Pursuant to the applicable Listing Regulations senior management has confirmed the compliance to the Code of Conduct of the Company and submitted the required annual compliance declaration to the Company. The Manager & Director Certificate on affirmation to the Code of Conduct is attached as part of Corporate Governance Report.

The detail of the Code of Conduct is available on website of the Company i.e. www.morganmms.com

FINANCE AND TAXATION:

During the financial year 2022-23, to update the Unilateral Advance Pricing Agreement for a period of five years from the financial year 2021-22 to 2025-26, the regional APA Commissioner has visited the site and the Company is awaiting a response from the department.

We have liquidated accumulated IGST input credit of Rs. 892.68 lakhs as per the provision of GST law. Our VAT assessment till FY 2017-18 has been completed and refund order received from the Department.

Your Company has continued to apply for Export Incentives under Remission of Duties and Taxes on Export Products (RODTEP) as part of the Foreign Trade Policy. During the year 2022-23, we have received duty benefit scripts amounted to Rs. 65.76 lakhs. The process of claiming RODTEP benefit is well established, and we are receiving duty benefit scripts on regular basis.

EThICS AND LEGAL GOVERNANCE:

Morgans ethics and compliance strategy has strengthened our ethical culture and reinforced the controls in key compliance risk areas as covered under the Morgan Code.

The Morgan Code is a foundational component of our ethics and compliance programme. The Morgan Code is a set of principles, supported by Group policies, which set out how we must conduct ourselves in support of our people, our communities, our business partners and our shareholders. It applies to all employees and extends, as appropriate, to Morgans business partners including agents and other third-party representatives.

The Morgan Code underpins our commitment to our people, our communities, our customers, our suppliers and our shareholders. It defines how we do business ethically and safely. The Morgan Code is a set of principles (supported by Group policies) that lay out how we should conduct ourselves. The Morgan Code applies to all employees and to the extent appropriate to Morgans business partners including agents, joint venture partners and third-party representatives.

The Morgan Code has four sections i.e., working safely, working ethically, treating our people fairly and protecting our business. It requires our people to operate in accordance with applicable laws, regulations and Company policies and processes relating to areas such as ethical business behaviour, trade compliance, gifts and entertainment, donations and sponsorships.

Ethics and Compliance Training Programme

In compliance with Morgan Groups guidelines, your Company has given e-learning training programmes to all employees on various topic of anti-bribery and anti-corruption, conflict of interest and anti-competitive practices. Apart from this e-learning, we continued practice of arranging Ethics Theme of the Month session for all employees on monthly basis on various ethics and compliance topics.

‘Speak-up Ethics helpline

We maintain a confidential ‘Speak Up ethics helpline operated by an independent third party where anyone can raise a concern or report a suspected violation of our policies, procedures or the law as an alternative channel to reporting concerns internally. Reporters can raise concerns by telephone, web form or email and may elect to remain anonymous. The employees, contractors or other third parties who have a question about the Code or see something that they feel is unethical or unsafe can discuss these with their managers, supporting teams, or through the ethics hotline, a confidential helpline operated by an independent company.

During the year, there was 1 complaint raised by the third party which was investigated, and the necessary disciplinary action was taken as appropriate.

Further, in compliance with Listing Regulations and the provisions of Companies Act, 2013, the policy is also available on the website – http://www.morganmms.com/en-gb/investors/

Compliance Commitment

Your Company is committed to follow all applicable local, central and international laws & regulations wherever we operate. The Compliance Officer submits a quarterly compliance report to the Audit Committee and Board Members on various applicable laws to the Company and its compliance status thereon. During the year, your Company has not identified any non-compliance relating to the various statutes applicable to the Companys business operations.

hUMAN RESOURCES:

Ambition, Innovation, Collaboration, and Integrity are the guiding principles for the success of Morgan. Our employees are our brand ambassadors who are contributing to make it happen. They bring enthusiasm, energy, vigour, and ideas every day to not only deliver product and service excellence, but also play a significant role in helping us fulfil our aspirations in this new era.

Our people contribute to the culture and are the driving force behind our success. In return we aim to be a caring organisation where everyone feels valued and appreciated. Our key principle is that ‘it is not just what you do, but how you do it that is important. We are committed to providing a safe, fair, and inclusive workplace. Our aspirations and 2030 goals outline our focus for making Morgan a better place for our people.

We provide our employees with an empowering, collaborative, non-discriminative and safe work culture where they learn and lead. We engage with our employees, invest in their professional development, provide them with a meaningful purpose, focus on their health & safety, celebrate innovation and out-of-the-box thinking, support well-reasoned risk-taking, and reward our employees for their performance.

We use our ‘Leadership Behaviours and the Morgan Code to guide the actions we take. This helps us to achieve our strategic aim of delivering performance and value creation for our stakeholders.

We promote equal opportunities for all employees and job applicants, and do not unlawfully discriminate on the grounds of gender, parental leave needs, marriage/civil partnership status, race, disability, sexual orientation, age, religion, or belief etc.

Our Company believes that we need to recruit a diverse range of professionals to help in solving our customers challenges, including materials scientists, application engineers and functional specialists. Finding, retaining, and developing the right people to meet the ever changing and challenging requirements of our business is a key priority for all of us, and helps to ensure diverse representation in the organisation. The employee turnover ratio was 10.83% as compared to 8.08% the previous year.

Developing our people is key for Morgan to be successful in the marketplace now and in the future. We emphasize for every employee to perform at their best, reach their full potential and feel rewarded for what they do. During the last year, while we continued our focus on virtual learning offerings to our employee, we also provided key in-person learnings including our in-house Supervisory Development Program – "Elevate" to all the mid-level and first line supervisors, Leadership Development Program "LEAP" : Leadership Enhancement & Advancement Program" to the senior leadership team and awareness program on POSH to all the employees.

During the year, the company has organised more than 7600 hours of training on more than twenty-five various topics against 2470 hours the previous year for nurturing existing peoples talent and motivating them to attain organisation goals.

At Morgan we believe our people are at the heart of our strategy. We want to support our people to perform at their best and reach their potential. Performance conversations and ongoing feedback are a key part of achieving this. The principle of pay for performance underpins our compensation approach. Compensation levels are set using external benchmarking and relevant commercial considerations that are both competitive and affordable. We offer short term performance incentives to our managers as well as technical and functional experts. The Morgan Group recognises & rewards the accomplishments of its people individually and as teams.

Having people who bring a diverse range of talents and perspectives, and who feel engaged in their role, is of paramount importance to our long-term success. Our employees are instrumental in making Morgan the company it is today. They are key to driving the brand forward and ensuring it remains relevant in the future. Through our "Your Voice" Survey we gauge employee engagement and gather feedback from them annually.

Ninety-nine percent of our people participated in the 2022 Your Voice survey and shared their opinion. The overall engagement score rose to 56%, compared to 49% from 2021. Employee feedback from Your Voice showed that our employees strongly believe and are in alignment with Morgans commitment and focus on Safety and Ethics, along with Customer Satisfaction.

AUDITORS:

Statutory Auditors

M/s Deloitte Haskins & Sells LLP, Chartered Accountants, Pune (Registration No. 117366W/W-100018) were appointed as statutory auditor of the Company for a period of five years - from conclusion of 35^th Annual General Meeting until conclusion of 40^th Annual General Meeting - as per approval of the members in the 35^th Annual General Meeting with professional fees and charges as mutually agreed between M/s Deloitte Haskins & Sells LLP and the Company.

The report given by the Statutory Auditors on the financial statements of the Company forms part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditors in their report.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s KMP & Associates, (FCS9710 / COP 11947) Practicing Company Secretaries, were appointed to conduct the Secretarial Audit of the Company for the financial year 2022-23. The Secretarial Audit Report for financial year 2022-23 forms part of the Boards Report as Annexure - IV. The Board has appointed M/s Prajot Tungare & Associates,

Practicing Company Secretaries, as Secretarial Auditor of the Company for the financial year 2023-24.

There has been no qualification, reservation, adverse remark or disclaimer given by M/s KMP & Associates, Secretarial Auditor in their report.

INTERNAL CONTROL SYSTEMS AND ThEIR ADEQUACY

Your Company has a well-established framework of internal controls in operation, supported by Morgan Groups policies and guidelines, including periodic monitoring, assessment and internal audit.

M/s Unicus Risk Advisors LLP, internal auditors of the Company have conducted internal audit for complete year and detailed report was submitted to Audit Committee on periodic basis. Further, the Audit Committee reviewed the adequacy and effectiveness of the implementation of audit recommendations, including those relating to strengthening your companys risk management policies and systems.

In compliance with Section 177(4)(vii) of the Companies Act, 2013, the Audit Committee needs to evaluate internal financial control systems of the Company and make further reports to the Board and as per Section 143(3) (i) of the Companies Act, 2013, the Statutory Auditor of the Company is required to make representation in their Auditor Report that the Company has adequate internal financial control system in place and operating effectively.

During the year, your Company considered that the internal financial control provides reasonable assurance in the area of proper accounting controls for ensuring reliability of financial reporting, monitoring of operations safeguarding of Companys assets, transactions are authorised and recorded in a correct and timely manner and that such controls would prevent or detect, within a timely period, material errors or irregularities. The system is designed to mitigate and manage risk, rather than eliminate it and to address key business and financial risks. The Company has continued emphasised to align all its processes and controls as per Morgan Groups guidelines and policies.

Your Company as well as statutory, internal & secretarial auditors has made periodic checks relating to prevention and detection of frauds and errors, accuracy and completeness of accounting records, timely preparation of financial statements and applicable statutory compliances to the Companys business. The internal auditor and statutory auditor during their audit have not found any significant gaps for the financial year 2022-23 however have made certain recommendation for continuous improvement of the process.

ANNUAL RETURN:

In accordance with Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014 the Company has placed the Annual Return on the Companys website - https://www.morganmms.com/en-gb/investors/

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement of Section 134 (3) (c) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:

(i) In the preparation of the annual accounts for the financials year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures. (ii) The Directors 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 profit of the Company for the year; (iii) The Directors have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) The Directors have prepared the annual accounts on a ‘going concern basis; (v) The directors have laid down internal financial controls, which are adequate and are operating effectively; (vi) The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013 read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules 2016 ("the IEPF rules") all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF, established by the Government of India, after the completion of seven years. Further, according to the rules, the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the Demat Account of IEPF Authority.

During the year, your Company has transferred the unpaid and unclaimed dividends for the financial year 2014-15 of

Rs. 52,441/- to IEPF Authority.

OThER DISCLOSURES: a) Your Company has not accepted any deposits from the public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

b) Your Company has not issued shares with differential voting rights and sweat equity shares during the year under review.

c) Your Company has complied with the applicable Secretarial Standards relating to ‘Meetings of the Board of Directors and ‘General Meetings during the year.

d) Maintenance of cost records and requirement of cost Audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable to the business activities carried out by the Company.

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

f) There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.

g) There were no instances where your Company required the valuation for one time settlement or while taking the loan from the Banks or Financial institutions.

ENERGY CONSERVATION, TEChNOLOGY ABSORPTION AND FOREIGN EXChANGE EARNINGS AND OUTGO:

The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are enclosed as Annexure - V to the Boards report.

ACKNOWLEDGEMENTS:

Your Directors take this opportunity to offer their sincere thanks to various Departments of the Central and State Governments, our Bankers, Shareholders, Customers & Consultants for their strong support and assistance. Your Directors also place on record their deep appreciation to employees at all levels for their hard work, solidarity, dedication and commitment, and look forward to their continued support in the future.

	For and on behalf of the Board,
	Mukund Bhogale	Aniruddha Karve
	(Chairman)	(Director)
	DIN: 05122774	DIN: 07180005
Place: Aurangabad
Date: May 30, 2023