Navin Fluorine International Ltd Directors Report

Your Directors are pleased to present the 26th Annual Report together with the Annual Audited Financial Statements of the Company for the financial year ended March 31, 2024.

1. FINANCIAL HIGHLIGHTS

(Rs. in crores)

Particulars	Consolidated		Standalone
	FY 2023-24	FY 2022-23	FY 2023-24	FY 2022-23
Revenue from Operations	2,065.01	2,077.40	1,420.83	1,628.14
Other Income	55.85	35.73	67.37	41.00
Total Income	2,120.86	2,113.13	1,488.20	1,669.14
Profit before Depreciation, Finance Costs, Exceptional Items and Tax	454.13	586.04	302.88	462.89
Less: Depreciation and Amortization Expenses	96.16	62.64	57.58	42.60
Less: Finance Costs	74.56	27.52	4.96	2.05
Profit before Exceptional Items and Tax	283.41	495.88	240.34	418.24
Add: Exceptional Items	52.13	-	52.13	-
Profit Before Tax	335.54	495.88	292.47	418.24
Less: Tax Expense	65.03	120.69	57.30	105.75
Less: Share of (loss) from Joint Venture (net)	0.01	0.01	-	-
Profit After Tax	270.50	375.18	235.17	312.49
Add: Surplus brought forward from the previous year	1,901.05	1,579.62	1,861.91	1,603.16
Amount available for appropriation	2,171.55	1,954.80	2,097.08	1,915.65
Appropriation:
Other Comprehensive Income/(Loss)*	(0.54)	0.77	(1.58)	0.78
Payment of Dividends	(74.36)	(54.52)	(74.36)	(54.52)
Reversal of excess provision of Dividend Distribution Tax	-	-	-	-
Surplus carried to Balance Sheet	2,096.65	1,901.05	2,021.14	1,861.91

"Remeasurement of (loss)/gain (net) on defined benefit plans, recognized as part of retained earnings. Note: Figures are regrouped wherever necessary to make the information comparable.

2. DIVIDEND

Interim & Special Dividend

The Company had declared an Interim Dividend of Rs. 5/- per equity share (i.e. 250% of the face value) and a Special Dividend of Rs. 3/- per equity share (i.e. 150% of the face value) to commemorate the centenary birth year of the Companys founder Shri. Arvind N. Mafatlal, for the Financial Year 2023-24, which was paid in November 2023 from the profits of the Company.

Final Dividend

The Board of Directors has recommened a Final Dividend of Rs. 7/- per equity share (i.e. 350% of the face value) for the Financial Year 2023-24 out of the profits of the Company which shall be paid on or after August 07, 2024 if declared by the Members of the Company at the 26th Annual General Meeting (‘AGM).

The paid Interim and Special Dividend, and the recommended Final Dividend are in accordance with the provisions of the Companies Act, 2013 (‘the Act) and the Dividend Distribution Policy of the Company which is available on the Companys website at https://www.nfil. in/investor/policies/ddp.pdf.

3. STATEMENT OF COMPANYS AFFAIRS &

YEAR IN RETROSPECT

The Companys focus on safety, reliability and efficiency and commitment to sustainability has continued to drive its success in what was otherwise a challenging market environment. For the year ended March 31, 2024, the Company achieved a consolidated revenue from operations of Rs. 2,065.01 crores, largely flat, compared to Rs. 2,077.40 crores during the previous year. Consolidated earnings before interest, tax, depreciation and amortization (EBITDA), before exceptional items, decreased from Rs. 586.04 crores in the previous year to Rs. 454.13 crores during the year ended March 31, 2024. Consolidated Profit before Tax (PBT), before exceptional items, was Rs. 283.41 crores in the current year as compared to Rs. 495.88 crores in the previous year. The performance was underpinned by strong delivery of operating cash flow of Rs. 749.89 crores compared to (63.59) crores for the previous year on a consolidated basis, aided in part by affirmative actions to optimize working capital levels.

The Consolidated Operating EBITDA, before other income and exceptional items, touched Rs. 398.28 crores, down from Rs. 550.31 crores during the previous year, a decline of 27.62%. Operating EBITDA Margin for the year was at 19.29% against 26.49% in the previous year. The performance reflects the challenging market conditions characterized by rising geopolitical tensions, stickier inflation, higher for longer interest rates and destocking phenomena, particularly in the agchem space. In this challenging environment, the Company continued to drive discipline, operational and financial rigour across its activities while continuing to invest in manufacturing capabilities and expanding its product portfolio. As the Company navigates through these short-term challenges and opportunities, it is essential to remain steadfast in commitment to operational excellence, innovation, and sustainability. By leveraging strengths and embracing change with enhanced discipline and rigour, the Company will emerge stronger and more resilient, ready to seize the future opportunities.

HPP (High Performance Products) and Specialty Chemicals business segments secured strong growth underpinned by the Companys strategic and innovative initiatives. While CDMO business saw decline of 42% on Y-o-Y basis due to market forces, the Company remains constructive of the opportunities in this space and is driving improved performance in near future. Specialty Chemicals and HPP businesses saw 14% & 8% growth respectively over previous year.

The Specialty Chemicals vertical continues to be a cornerstone of the Companys business, offering a diverse range of high-value products to customers in industries ranging from pharmaceuticals to agrochemicals. The performance of this vertical is a testament to the Companys commitment to meeting the unique needs of its customers and providing them with innovative solutions that drive their success. Specialty Chemicals business recorded a turnover of Rs. 848 crores vis-a-vis Rs. 743 crores in the previous year, showing a robust growth of 14%. It contributed around 41% of the overall turnover. The growth was driven primarily by the Dahej assets being fully operational. The business aims to further its product portfolio by introducing newer and differentiated products.

During the year, HPP business vertical recorded sales of Rs. 955 crores compared to Rs. 886 crores in the previous year, contributing around 46% of the overall turnover. During the year, HPP business commenced operations of its new HFC asset which also contributed significantly to its growth. Considering the early success of the HFC asset, it has been decided to double its capacity. Refrigerant gases business witnessed a tough pricing environment coupled with high inflow of Chinese material in middle east region resulting in depressed realisations and margins. Performance of the inorganic fluorides division was consistent with last year despite pricing challenges. With new capacity envisioned following the execution of the already announced HF Capex, the business aims to leverage its position by expanding into newer high margin products and harnessing new opportunities in the emerging sectors. In HFO business, the Company has successfully stablised new HFO plant and is gradually increasing the production. HPP business remains focused on developing eco-friendly refrigerants, which are gaining popularity in the market. The business aims to continue investing responsibly in this space to ensure that it plays a leadership role by helping India and the world transition to eco-friendly refrigerants, ramping up capabilities further.

In the CDMO business, the Company partners with pharmaceutical and biotech companies to provide flexible and reliable manufacturing solutions. The Companys state-of-the-art facilities and experienced team ensure that it delivers high-quality products on time and in compliance. The business is typically characterized by lumpiness in revenues across years/quarter-on-quarter - to address this, and whilst maintaining a strong pipeline of early stage projects, the Company has enhanced its efforts to target commercial/late stage projects - the signing of a multi-year, multi-million dollar contract with a large European CDMO player for supply of intermediates to an already commercial patented molecule, is a first, yet significant step, in this direction. The business contributed 13% of overall turnover for the year. The Company continues to believe in the long-term growth prospects of the business and has decided to invest further Rs. 288 crores to increase the production capacity.

Key raw material costs moved in a mixed trend through the year with prices of Fluorspar increasing over a period of time while Boric Acid was relatively stable. Prices of almost all other critical raw materials decreased, more particularly, sulphur, caustic soda & chloroform were lower by 51.30%, 39.48% and 46.05% respectively Y-o-Y. On the energy cost front, average power cost was higher than previous year. Average natural gas price was lower by about 16.76% in the current fiscal compared to that of the previous year. The Companys strategy on building a resilient supply chain continues in action with increasingly diverse sources for key imported raw materials and securing majority of other raw materials within close proximity to its sites. Further, during the year, the Company has focused on increasing the usage of green power and is proud to share that about 30% of Surat plants power consumption was from green sources.

The specialty business Capex of about Rs. 540 crores for manufacturing agri intermediate for a global major is progressing well and is expected to commence operation during early FY25. Further, the HF capex at Dahej is also progressing well and is expected to commence operations in early FY26. During the year, the Company announced further expansion of its CDMO capacity with investment of Rs. 288 crores as also capex to double its HFC capacity with an investment of Rs. 84 crores. These investments lay the foundation for the next phase of growth of CDMO and Refrigerant gas businesses. It will help enhance product offerings and strengthen customer relationships along with providing building blocks for future growth.

During the year, Indian rupee depreciated against all major global currencies. Rupee depreciation supported higher realizations as the contribution of exports within the overall sales decreased from 66% to 65%. The exchange gain of Rs. 1.83 crores as seen in the financials is on account of timing difference of foreign exchange transactions and their realisation and / or restatement.

During the year, the Company continued to invest in strengthening capability across strategic functions like Technology and Development, Research and Development and Business Development. Improvement in operational efficiencies, new product development, working on novel chemistries and developing longterm partnerships continued to remain core ingredients of the Companys strategy. Throughout the year, cross functional teams continued to work on successful scaleup, improving productivity, quality and costs of various products to enable businesses gain competitive advantage in the market.

On a standalone basis, for the year ended March 31, 2024, the Company achieved total revenue from operations of Rs. 1,420.83 crores, Earnings before interest, tax, depreciation and amortization (EBITDA), before exceptional items of Rs. 302.88 crores and Profit before tax (PBT), before exceptional items, of Rs. 240.34 crores

The Company maintained ‘CARE AA rating, indicating high degree of safety with respect to timely servicing of financial obligations and very low credit risk, for borrowings with a tenure of more than one year. The rating for short-term facilities of tenure less than one year, remains at ‘CARE A1+ indicating very strong degree of safety with respect to timely servicing of short-term financial obligations and lowest credit risk. During the year, the Company continued to enjoy ‘Responsible Care accreditation and published its first sustainability report.

The Company is confident of continuing to lead the way in innovation, sustainability and excellence. Together, we will build a brighter, more sustainable future for generations to come. Further details are provided under various other heads of this Report and in the Management Discussion and Analysis Report annexed to this Report.

4. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE The Company has 6 (Six) subsidiaries

(i) Sulakshana Securities Limited (SSL), an entity created to settle dues of the term lenders of Mafatlal Industries Limited, remained a wholly - owned subsidiary of the Company. After settling all the third-party dues, SSL was left with 1,455 Square Meters of commercial floor space at Mafatlal Centre, Nariman Point, Mumbai and a significant portion of this property has been leased out on contemporary terms. SSL repaid all its debt owed to the Company during the financial year.

(ii) The Company owns 100% of Manchester Organics Limited (MOL), a specialized chemicals research company in Runcorn, U.K., holding 51% ofthe ordinary voting shares of MOL directly and the balance 49% through NFIL (UK) Limited, a 100% stepdown subsidiary created for the purpose. During the year, MOL reported a turnover of ?2,433K and net loss of ?177K. The Company has charted out a roadmap for MOL involving actions to drive high margin turnover as also actions to optimse costs with the objective of turning around over next 12-24 months.

(iii) NFIL (UK) Limited is a Wholly Owned Subsidiary of the Company incorporated in the UK to acquire the balance shareholding of 49% of MOL.

(iv) A step-down subsidiary, NFIL USA Inc. was formed as a Wholly Owned Subsidiary of NFIL (UK) Limited. The primary objective of formation of this Company is to increase the market penetration in the USA of the CDMO business and attracting appropriate talent as and when the business needs expansion.

(v) Navin Fluorine (Shanghai) Co. Ltd., a wholly owned foreign enterprise under Chinese Laws, was incorporated with a view to establish a strategic presence closer to the source of key raw materials, whilst helping forge strategic relationships and enabling businesses to make informed decisions to secure procurement efficiencies and advantage.

(vi) Navin Fluorine Advanced Sciences Limited (NFASL) was incorporated in February 2020. NFASL is a material subsidiary. NFASL commenced commercial operations during the financial year ended March 31, 2023. During the financial year ended March 31, 2024, it achieved total revenue from operations of Rs. 762.73 crores, Earnings before interest, tax, depreciation and amortization (EBITDA), before exceptional items of Rs. 160.24 crores and Profit before tax (PBT), before exceptional items, of Rs. 41.41 crores.

During the year, assets capitalised in NFASL amounting to Rs. 55.08 crores include assets for improving efficiencies and storage space. Further, in FY25, NFASL will incur capital expenditure on HF manufacturing plant and commission the new specialty chemical plant to supply fluorine based agri intermediates.

Capex undertaken in NFASL is funded through mix of debt and equity contribution. As on March 31, 2024, debt outstanding stood at Rs. 1,295.56 crores The said loans are secured by way of first charge on NFASLs fixed assets, second charge on its current assets and corporate guarantees given by the Company.

Policy for determining material subsidiary is available at https://www.nfil.in/investor/policies/ mspf_01042019.pdf.

The Company has 1 (one) joint venture

The Company is a joint venture partner with Gujarat Mineral Development Corporation Limited (‘GMDCL) and Gujarat Fluorochemicals Limited, in Swarnim Gujarat Fluorspar Private Limited, formed for the purpose of beneficiation of fluorspar ores to be supplied by GMDCL from its mines.

No company has become or ceased to become subsidiary, associate or JV of the Company during the year.

Highlights of Financial Performance of Subsidiaries and Joint Venture

Pursuant to Section 129(3) of the Act, a separate statement containing salient features of the financial statements of each subsidiary and JV of the Company is annexed in the format of Form AOC-1 to the Financial Statements of the Company. The Financial Statements of all the aforesaid subsidiaries and Joint Venture have been considered in the Annual Audited Consolidated Financial Results of the Company.

The Annual Financial Statements of all subsidiary companies are placed on the Companys website at https://www.nfil.in/investor/annu_reports.html. Copies of the same will be made available to interested Members who may write to the Company Secretary in this regard.

5. CAPITAL STRUCTURE OF THE COMPANY

Particulars	No. of Equity Shares	Face Value ()	Paid-up Share Capital ()
Paid-up Share Capital as on April 01,2023	4,95,62,250 (fully paid) and 8,920 (Rs. 1/- paid-up)	2/-	9,91,33,420/-
Equity Shares allotted under ESOPs during the Financial Year 2023-24*	2,230	2/-	4,460/-
Paid-up Share Capital as on March 31, 2024	4,95,64,480 (fully paid) and 8,920 (Rs. 1/- paid-up)	2/-	9,91,37,880/-

* The equity shares allotted under Employees Stock Option Scheme 2007 and Employees Stock Option Scheme 2017 rank pari-passu with existing equity shares of the Company.

Out of 8,920 partly paid equity shares, the Company is in process of obtaining corporate action approval from Depositories for 860 partly paid equity shares.

6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT, AND CORPORATE GOVERNANCE REPORT

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations), the Management Discussion and Analysis Report, and Corporate Governance Report along with the Certificate received from Parikh & Associates,

Practicing Company Secretaries, confirming compliance with corporate governance requirements as per SEBI Listing Regulations are annexed as ‘Annexure 1 and ‘Annexure 2 respectively to this Report

7. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Company is committed to the highest environmental, social and governance standards. In accordance with SEBI Listing Regulations, the Business Responsibility and Sustainability Report describing the initiatives taken by the Company on this front, in the prescribed form is annexed as ‘Annexure 3 to this Report.

8. CORPORATE SOCIAL RESPONSIBILITY

The Company firmly believes that Corporate Social Responsibility (‘CSR) is more than an obligation and more than a duty, which helps to create positive impact on many lives. The Company persistently acts as a prudent corporate citizen and maintains harmonious relationship with the communities in which it operates to give back to the society.

The Companys CSR Policy is reflective of its CSR philosophy and highlights the snapshot of activities undertaken by the Company. The scope of the Policy includes the areas covered under the Policy and activities eligible for CSR contribution. The other aspects covered by the Policy include guiding principles for: (i) selection of CSR activities and annual action plan, (ii) execution of CSR activities and (iii) monitoring CSR activities, along with voluntary impact assessment.

The Companys CSR policy is available on the website of the Company at https://www.nfil.in/investor/policies/ NFIL CSR Policy 1.pdf

The Companys CSR initiatives extend across health, education, sports, sustainable livelihood, animal care and other social causes through its CSR expenditure of Rs. 7.45 crores for the financial year 2023-24 vis-avis mandatory spend of Rs. 7.31 crores pursuant to the provisions of Section 135 of the Act. In addition to this, CSR spend from Navin Fluorine Advanced Sciences Limited was Rs. 0.54 crores. The requisite details on CSR initiatives pursuant to Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 are annexed as ‘Annexure 4 to this Report.

The Companys approved Annual Action Plans on CSR are available on the Companys website at https://www. nfil.in/csr/index.html

9. ANNUAL RETURN

The Annual Return of the Company for the financial year 2023-24 is available on the website of the Company at https://www.nfil.in/investor/annu_reports.html.

10. UNCLAIMED DIVIDEND / INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

As per Section 124 of the Act read with the Rules made thereunder, any dividend amount transferred to Unpaid Dividend Account which remains unclaimed or unpaid for 7 years is transferred to IEPF and shares in respect of which dividend has not been paid or claimed for 7 consecutive years or more are transferred to IEPF.

The details of shares and dividends transferred to IEPF by the Company during the year are available at: https:// www.nfil.in/investor/unpaid.html. The Company intimates concerned Members and issues public notice in respect of shares to be transferred to IEPF in the newspaper, on timely basis.

11. LOANS, GUARANTEES, SECURITIES AND INVESTMENTS

The details of loans and guarantees given, securities provided and the investments made by the Company as on March 31, 2024 pursuant to Section 186 of the Act are provided in the Annual Audited Financial Statements.

12. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were in the ordinary course of the business (except for the transaction of tendering of few eligible shares held by the Company in Cebon Apparel Private Limited through Buy Back). All Related Party Transactions that were entered during the financial year were on arms length basis. Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014, the details of contracts / arrangements entered with related parties in prescribed Form AOC-2, is annexed as ‘Annexure 5 to this Report.

The Companys Policy on materiality of related party transactions and on dealing with related party transactions is available on the Companys website at https://www.nfil.in/investor/policies/pmrptrpt.pdf.

13. BOARD MEETINGS

During the year, 9 (nine) Board Meetings were held. The details of the Board Meetings are mentioned in the Corporate Governance Report annexed to this Report.

14. DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors of the Company have submitted declarations confirming that:

a) They are independent as per Section 149(6) of the Act and Regulation 16 of SEBI Listing Regulations;

b) They have registered themselves with Independent Directors Database of The Indian Institute of Corporate Affairs (‘IICA) and have cleared the online proficiency test of IICA, as applicable.

c) They are not aware of any circumstances or situations, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence; and

d) They have complied with the Code of Conduct for Independent Directors as prescribed under Schedule IV to the Act, as applicable.

Accordingly, the Board of Directors of the Company is of the view that Independent Directors fulfill the criteria of independence and they are independent from the management of the Company.

15. DIRECTORS RESPONSIBILITY STATEMENT

As required under the provisions of Section 134 of the Act, your Directors report that:

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

(b) 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 of the profits of the Company for that period;

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

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

(e) The Directors have laid down internal financial controls (as required by Explanation to Section 134(5)(e) of the Act) to be followed by the Company and such internal financial controls are adequate and are operating effectively;

(f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

16. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL

At the 25th Annual General Meeting of the Company held on July 31, 2023, the following Directors were appointed/ re-appointed by the Members of the Company:

• Mr. Vishad P. Mafatlal was re-appointed as Director of the Company as he had retired by rotation and offered himself for re-appointment as Director

• Mr. Radhesh R. Welling was re-appointed as Managing Director for a term of 5 (five) consecutive years commencing from December 11, 2023 and ending on December 10, 2028

• Mr. Atul K. Srivastava was re-appointed as an Independent Director of the Company, not liable to retire by rotation, for a second term of 5 (five) consecutive years commencing from June 21, 2024 and ending on June 20, 2029

During the year, Mr. Radhesh R. Welling resigned from the post of Managing Director and Director of the Company with effect from close of business hours of December 15, 2023. The Company places on record its appreciation for the services rendered by Mr. Welling during his tenure.

Further, Mr. Sudhir R. Deo was appointed as an Additional Director and Non-Executive Non-Independent Director of the Company with effect from September 28, 2023 by the Board of the Company subject to approval of the shareholders. Mr. Deo was appointed as NonExecutive Non-Independent Director with effect from September 28, 2023 by the shareholders on December 21, 2023 through postal ballot.

Mr. Mohan M. Nambiar, Non-Executive Non-Independent Director, retires by rotation and is eligible, but does not offer himself for re-appointment as Director as due to his age, he has chosen to gradually reduce his engagements. The Company places on record its appreciation for the invaluable services rendered and guidance provided by Mr. Nambiar during his tenure.

Further, Mr. Sunil S. Lalbhais second term as Independent Director of the Company will end on June 24, 2024. The Board of Directors of the Company, at its Meeting held on

May 07, 2024, appointed him as Additional Director and, Non-Executive Non-Independent Director with effect from June 25, 2024 based on the recommendations of the Nomination and Remuneration Committee, subject to approval of the Members of the Company.

The Board of Directors of the Company at its Meeting held on May 07, 2024, appointed Mr. Abhijit J. Joshi as an Additional Director and Independent Director of the Company for a tenure of 5 (five) consecutive years commencing from May 07, 2024 and ending on May 06, 2029 based on the recommendations of the Nomination and Remuneration Committee, subject to approval of the Members of the Company.

As required under Section 160 of the Act, notices have been received from Members of the Company proposing the candidature of Mr. Lalbhai and Mr. Joshi as a Director.

Brief profiles of Mr. Lalbhai and Mr. Joshi are provided in the Notice convening the 26th Annual General Meeting.

17. COMMITTEES OF THE BOARD

The Company has duly constituted the following statutory committees as per the provisions of the Act & SEBI Listing Regulations:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Risk Management Committee

• Corporate Social Responsibility Committee

The details of the composition, number of Meetings, terms of reference and other information of all the aforesaid committees are included in the Corporate Governance Report which forms part of this Report.

Audit Committee

The composition of the Audit Committee is as under:

Sr. No. Names	Designation
1 Mr. Sunil S. Lalbhai	Chairman
2 Mr. Pradip N. Kapadia	Member
3 Mr. Mohan M. Nambiar	Member
4 Ms. Radhika V. Haribhakti	Member

During the year, there were no instances when the recommendations of the Audit Committee were not accepted by the Board of Directors of the Company.

18. VIGIL MECHANISM / WHISTLE BLOWER POLICY

As per the requirements of the Act and SEBI Listing Regulations, the Company has a Whistle Blower Policy approved by the Board of Directors. The objectives of the policy are:

a) To provide a Vigil Mechanism for Directors and employees of the Company and other persons dealing with the Company to report to the Audit Committee; their concerns relating to the Company, any instance of unethical behaviour, actual or suspected fraud or violation of the Companys Ethics Policy;

b) To safeguard the confidentiality and interest of such employees / other persons dealing with the Company against victimization, who notice and report any unethical or improper practices; and

c) To appropriately communicate the existence of such mechanism within the organization and to outsiders.

Whistle Blower Policy is available on the website of the Company at https://www.nfil.in/investor/policies/ Whistle%20Blower%20Policy.pdf. The Company confirms that no personnel have been denied access to the Audit Committee pursuant to the whistle blower mechanism.

19. ANNUAL PERFORMANCE EVALUATION

Pursuant to the provisions of the Act and SEBI Listing Regulations, performance evaluation was carried out as under:

Board of Directors

In accordance with the criteria suggested by the Nomination and Remuneration Committee, the Board of Directors evaluated the performance of the Board, having regard to various criteria such as Board composition, Board processes and Board dynamics. The Independent Directors, at their separate meeting, also evaluated the performance of the Board as a whole based on various criteria. The Board and the Independent Directors were of the unanimous view that performance of the Board of Directors as a whole was satisfactory.

Committees of the Board of Directors

The performance of the Audit Committee, the Corporate Social Responsibility Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee and the Risk Management Committee was evaluated by the Board having regard to various criteria such as committee composition, committee processes and committee dynamics. The Board was of the unanimous view that all the committees were performing their functions satisfactorily and according to the mandate prescribed by the Board under the regulatory requirements including the provisions of the Act read with the Rules made thereunder and SEBI Listing Regulations.

Individual Directors

(a) Independent Directors: In accordance with

the criteria suggested by the Nomination and Remuneration Committee, the performance of each Independent Director was evaluated by the entire Board of Directors (excluding the Director being evaluated) on various parameters like qualification, experience, availability and attendance, integrity, commitment, governance, independence, communication, preparedness, participation and value addition. The Board appreciated the contribution made by all the Independent Directors in guiding the management and concluded that continuance of each Independent Director on the Board will be in the interest of the Company. The Board was also of the unanimous view that each Independent Director was a reputed professional and brought his/her rich experience to the deliberations of the Board.

(b) Non-Independent Directors: The performance of each of the Non-Independent Directors (including the Executive Chairman) was evaluated by the Independent Directors at their separate meeting. Further, their performance was also evaluated by the Board of Directors. Various criteria considered for the purpose of evaluation included qualification, experience, availability and attendance, integrity, commitment, governance, communication etc. The Independent Directors and the Board were of the unanimous view that all the Non-Independent Directors were providing good business and people leadership.

20. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The Company has a policy on Appointment and Remuneration of Directors, Key Managerial Personnel and Other Employees as per Section 178(3) of the Act and Regulation 19 of SEBI Listing Regulations, which includes:

• Criteria for identification of persons for appointment as Directors and in senior management positions

• Criteria for determining qualifications, positive attributes, independence of a Director

• Board Diversity

• Remuneration to Non-Executive Directors, Key Managerial Personnel and Senior Management and remuneration to other employees

The Policy on Appointment and Remuneration ofDirectors, Key Managerial Personnel and Other Employees is available on the Companys website at https://www.nfil. in/investor/policies/Policyardkmpe.pdf.pdf.

21. INSURANCE

The properties, insurable assets of the Company such as Buildings, Plants and Machineries, and inventories among others are adequately insured.

The Company has Directors & Officers Liability (D&O) Policy which covers the Directors and Officers for the liabilities, if any, arising out of their actions/decisions in the normal course of discharge of their duties for the Company.

22. EMPLOYEES STOCK OPTION SCHEMES

The Company has two Employees Stock Option Schemes viz. Employees Stock Option Scheme 2007 and Employees Stock Option Scheme 2017 (‘ESOS 2017) which are in compliance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and there were no material changes therein. In this regard, a certificate from Parikh & Associates, the Secretarial Auditors of the Company, will be placed at the ensuing 26th Annual General Meeting for inspection by Members.

During the year, 2,27,500 Stock Options were granted to the eligible employees of the Company under ESOS 2017 The relevant details of the Employees Stock Option Schemes as per SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are specified in ‘Annexure 6 to this Report.

23. HUMAN RESOURCE

The total number of permanent employees of the Company as on March 31, 2024 was 1,029. The requisite details under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of ‘Annexure 7 to this Report.

The requisite details relating to the remuneration of the specified employees under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report. Further, this Report and Financial Statements are being sent to Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure will be open for inspection by any Member. Interested Members may write to the Company Secretary.

24. PREVENTION OF WORKPLACE HARASSMENT

The Company has in place a gender neutral Anti-Sexual Harassment Policy which aims to provide an environment, which is free of discrimination, intimidation and abuse. 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. During the year, no complaints were received from employees in this regard.

25. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to Financial Statements. It has laid down certain guidelines, policies, processes and structures which are commensurate with the nature, size, complexity of operations and the business processes followed by the Company. These controls enable and ensure the systematic and efficient conduct of the Companys business, protection of assets, prevention and detection of frauds and errors and the accuracy and completeness of the accounting and financial records. The controls have been reviewed and found satisfactory on the following key control matrices:

a. Entity level controls

b. Financial controls

c. Operational controls

The Company has a built-in review and control mechanism to ensure that such control systems are adequate and operating efficiently and these are persistently reviewed for effectiveness. The internal control system is maintained by qualified personnel and there is an internal audit review on a regular basis, to suggest adequacy and effectiveness of the system and to recommend improvements.

26. RISK MANAGEMENT POLICY

The Company has a structured risk management framework and policy that provides an all-inclusive approach to safeguard the organization from various risks, both operational and strategic, through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks that could materially impact the business objectives. The potential risks are inventorised and integrated with the management process such that they receive the necessary consideration during the decision making. Further details are provided in the Management Discussion and Analysis Report and Corporate Governance Report annexed to this Report.

27. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(Rs. in crores)

Particulars	FY 2023-24	FY 2022-23
Total Foreign exchange used	262.58	462.51
Total Foreign exchange earned	646.06	867.37

The information on conservation of energy and technology absorption is disclosed in ‘Annexure 8 to this Report pursuant to Section 134 of the Act read with the Companies (Accounts) Rules, 2014.

28. STATUTORY AUDITORS

At the 24th AGM held on July 27, 2022, the Members of the Company approved the re-appointment of Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016) for a second term of 5 (five) consecutive years commencing from the conclusion of the 24th Annual General Meeting until the conclusion of 29th Annual General Meeting based on the recommendations of the Audit Committee and the Board.

29. STATUTORY AUDITORS REPORT

There is no qualification, reservation or adverse remark or disclaimer made by the Statutory Auditors in their report on the Standalone and Consolidated Financial Statements of the Company for the financial year ended March 31, 2024.

As required under Rule 11 of the Companies (Audit and Auditors) Rules, 2014, auditors report has highlighted the fact that your Company has used an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and that has been operating throughout the year for all relevant transactions, except when certain privileged access are used, the audit log does not capture the pre-modified values for the changes and the audit trail has not been enabled at the database level for the accounting software to log any direct data changes that can be only made through certain privileged access. We would like to mention that the audit trail functionality for direct data changes has since been activated. Further, privileged access to database continues to be restricted to a limited set of users who necessarily require the same for maintenance and administration.

Auditors report also states that in respect of software used for processing payroll records, which is operated by a third party software service provider, the ISAE 3402 Type 2 report is not available with the software service provider and accordingly they were unable to comment whether the audit trail feature of the aforesaid software was enabled and operated throughout the year. We would like to highlight that we are working with the payroll process service provider to ensure the availability of required reports and audit trails.

30. SECRETARIAL AUDIT REPORT

Pursuant to Section 204(1) of the Act and Regulation 24A of SEBI Listing Regulations, the Secretarial Audit Report of the Company for the financial year ended March 31, 2024 issued by Parikh & Associates, Practicing Company Secretaries, is annexed as ‘Annexure 9 to this Report. Further, the Secretarial Audit Report of Navin Fluorine Advanced Sciences Limited, a Material Wholly Owned Subsidiary, for the financial year ended March 31, 2024 issued by Parikh & Associates, Practicing Company Secretaries, is annexed as ‘Annexure 10 to this Report. The aforesaid Reports do not contain any qualification, reservation or adverse remark or disclaimer.

31. COST RECORDS AND COST AUDITORS

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, maintenance of cost records is applicable to the Company and accordingly, such accounts and records are being maintained.

The Board of Directors, based on the recommendations of the Audit Committee, appointed B. Desai & Co., (Firm Registration No. 005431), Cost Accountants, as Cost Auditors to audit the cost accounts of the Company for the financial year 2024-2025 on agreed remuneration of Rs. 5,50,000/-.

As required under the Act, necessary resolution seeking Members ratification for the remuneration payable to B. Desai & Co. is placed at the 26th Annual General Meeting. The Cost Audit Report in respect of the financial year 2023-24 will be filed within the statutory timeline.

32. SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards on Meetings of the Board of Directors and General Meetings issued by the Institute of Company Secretaries of India and approved by the Central Government.

33. STATUTORY DISCLOSURES

a) The Company has not accepted any deposit from the public pursuant to Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014;

b) The Company has not issued equity shares with differential rights as to dividend, voting or otherwise;

c) The Whole Time Director, Key Managerial Personnel and Managing Director of the Company have not received any remuneration or commission from any of the subsidiaries;

d) No significant and material Orders have been passed by the regulators or courts or tribunals which impact the going concern status and the Companys operations in future;

e) As there was no buyback of shares during the year, the Company has nothing to disclose with respect to buyback of shares;

f) None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143(12) of the Act;

g) There were no material changes and commitments affecting the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this Report.

h) As permitted under the provisions of the Act, the Board does not propose to transfer any amount to general reserve.

34. APPRECIATION

The Board wishes to place on record its sincere appreciation for the dedicated services rendered by the employees who have largely contributed to the efficient management of your Company. The Board also places on record its appreciation for the persistent support from the shareholders, customers, suppliers, dealers, distributors, Governments, bankers, lenders and other stakeholders.

	By order of the Board of Directors
	For NAVIN FLUORINE INTERNATIONAL LIMITED
	Vishad P. Mafatlal
Date: May 07, 2024	Chairman
Place: Mumbai	DIN:00011350
Registered Office:
Office No. 602, 6th Floor, Natraj by Rustomjee,
Near Western Express Highway,
194, Sir Mathuradas Vasanji Road,
Andheri (East), Mumbai 400069, India
Tel: +91 22 6650 9999; Fax: +91 22 6650 9800
E-mail ID: info@nfil.in; Website: www.nfil.in
CIN: L24110MH1998PLC115499