Orient Green Power Company Ltd Directors Report

Total income on consolidated basis for the year stood at Rs.29,021 lakhs as against Rs. 31,522 lakhs reported for the corresponding period last year. EBITDA for the year stood at Rs. 20,295 lakhs as against Rs. 22,846 lakhs during previous year. EBITDA margins for the year stood at 70% as against 72% for previous year. Depreciation for the year stood at Rs.8,295 lakhs as against Rs. 8,862 lakhs recognized during last year.

Interest expense for the year stood at Rs.10,824 lakhs as against Rs. 12,161 lakhs for the previous year. Profit from continuing operations for the year stood at Rs.3,510 lakhs as against Rs.4,655 lakhs reported for previous year. The Loss from discontinued operations stood at Rs.177 lakhs as against a Loss of Rs. 1,077 lakhs in previous year.

The current fiscal is a moderate one in terms of wind availability with a dip in generation in comparative terms. Besides this, the previous year witnessed a one time income of Rs. 2,465 lakhs due to resumption in REC trading. Adjusting this, the EBITDA comparable for the year is marginally lower by Rs.86 lakhs, despite reduced generation. Our efforts to reduce the finance cost and improved loan servicing resulted in improved ratings and helped us in refinancing Rs. 721 crores of debt at an interest rate of 9.4% from Indian Renewable Energy Development Agency Limited (IREDA). Prior to refinancing the interest rate on these loans were 12.4%. The interest savings from these refinancing will be visible in the coming years. In addition, the Late Payment Surcharge (LPS) scheme introduced by the Ministry of Power helped in realizing the long pending dues from State owned discoms. To curtail the increasing costs of maintenance, the company is developing in house maintenance expertise reducing the reliance on external service providers. With improving cash flows, the management is exploring the opportunities for capacity expansion and venturing into solar energy.

During the year, one of the subsidiaries of the company having 129.3 MW of its capacity registered under Renewable Energy Certificates (REC) scheme opted out of the scheme. In the Managements assessment, this transition does not have any significant impact on the revenues of the company.

During the year, the company proposed to issue equity shares on a rights basis to the existing eligible equity shareholders for an amount aggregating up to Rs. 23,000 lakhs. The proceeds of the said issue are proposed to be utilized towards interalia, repayment of borrowings availed by the company and its subsidiaries and general corporate purposes. The draft letter of offer dated September 07, 2022 duly approved by the Rights Issue Committee was filed by the company with Securities and Exchange Board of India ("SEBI") and the stock exchanges on which the Rights Equity Shares are proposed to be listed.

The company received letters dated September 21, 2022 and September 19, 2022 from BSE and NSE, respectively granting in-principle approval for undertaking the Issue. Further SEBI issued final observations on the DLOF vide its letter dated February 13, 2023. The company is in the process of filing the letter of offer with Stock Exchanges and SEBI.

The Consolidated Financial Statements of the Company and its subsidiaries, prepared in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Companies Act, 2013 (the Act) read with relevant rules issued thereunder form part of the Annual Report and are reflected in the Consolidated Financial Statements of the Company. The annual financial statements of the subsidiaries and related detailed information will be kept at the Registered Office of the Company and will be available to investors seeking information at any time.

The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 16 (1) (c) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations). The Policy, as approved by the Board, are available on our website, at http://orientgreenpower.com/ files/Policy-on-Material-Unlisted-Subsidiary-Company.pdf.

The Company has not declared any dividend due to inadequate profit earned by the Company during the year.

During the year under review, the company vide approval of shareholders via Annual General Meeting the Memorandum of Association of the company has been altered by merging and retaining Clause III (C) – OTHER OBJECTS with Clause III B and to rename the Clause III (B) as per the provisions of the Companies Act, 2013.

During the year under review, the Promoter ie. Janati Bio Power Private Limiteds shareholding has been reduced from 25,88,08,809 Equity Shares to 24,38,08,809 Equity Shares by way of invocation of shares.

During the year under review, SEPC Limited, one of the Promoter vide its letter dated September 24, 2022 had requestedourCompanyforreclassificationfromthepromoter category to the public category, in view of its change in management and control pursuant to restructuring of debts under the "Prudential Framework for Resolution of Stressed Assets". Our Company has made an application dated November 30, 2022 to the Stock Exchanges under Regulation 31A of the SEBI Listing Regulations seeking reclassification of SEPC to public category and the said application is pending for the approval of the Stock Exchanges.

The Particulars of Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.

During the year ended March 31, 2023, Beta Wind Farm Private Limited (BETA), [Subsidiary of Orient Green Power Company Limited] had refinanced the existing term loan and working capital facilities amounting to Rs. 721.21 Crores and availed an additional term loan facility of Rs. 4.90 Crore from Indian Renewable Energy Development Agency Limited (IREDA), for which Orient Green Power Company Limited (OGPL) had issued a corporate guarantee for Rs. 726.11 crores and executed a pledge of 1,80,04,812 equity shares held by the company in Beta Wind Farm Private Limited. This guarantee replaces the earlier guarantees provided to Axis Bank Limited (Acting as a Security Trustee for Consortium Lenders) to an extent of Rs. 1,232.03 Crores and the pledge of 1,80,04,812 equity shares which earlier were provided as security to the erstwhile consortium of lenders.

There were no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of the report.

As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors Certificate thereon, and the Management Discussion and Analysis Report, the Business Responsibility and Sustainability Report ("BRSR") form part of the Directors Report.

As at March 31, 2023 your Company had a total of 6 subsidiaries, 3 step down subsidiaries, the details of which are given elsewhere in the Annual Report under the relevant Sections.

During the previous year, the Board gave its in-principle approval to liquidate Orient Green Power (Maharashtra) Private Limited and is in the process of voluntary strike off. During the year, the company disposed its entire shareholding in M/s. Pallavi Power and Mines Limited, associate company. The information as required under the first proviso to sub-section (3) of Section 129 is given in Form AOC-1, is attached to the financial statements of the Company. Further, pursuant to the provisions of Section 136 of the Companies Act, 2013 ("Act"), financial statements of the Company, Consolidated financial statements along with the relevant documents and separate audited accounts in respect of the subsidiaries of the Companies are available in the website of the Company http://www.orientgreenpower. com/ Subsidiary-Accounts.asp

The Company has not accepted any deposits either from the shareholders or public and as such, no amount of principal or interest was outstanding as on the date of Balance Sheet.

The Company has been complying with the provisions of Corporate Governance as stipulated in Regulations 24, 27 and other relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. A separate report on Corporate Governance along with Auditors Certificate on compliance of the Corporate Governance norms as stipulated in Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forming part of this report are provided elsewhere in this Annual Report.

The Company has in place, an adequate system of internal controls commensurate with its size, requirements and the nature of operations. These systems are designed, keeping in view the nature of activities carried out at each location and the various business operations. The company has documented a robust and comprehensive internal control system for all the major processes to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedures, laws and regulations, safeguarding of assets and economical and efficient use of resources.

The Internal Auditor monitors and evaluates the efficacy and adequacy of internal controls system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit, process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, the Audit Committee met regularly to review reports submitted by the Internal Auditor. All significant audit observations and follow-up actions thereon were reported to the Audit Committee. The Audit Committee also met the Companys Statutory Auditors to ascertain their views on the financial statements, including the financial reporting system, compliance to accounting policies and procedures, the adequacy and effectiveness of the internal controls and systems followed by the Company.

Your Company also has a Risk Management Framework in place covering all critical areas of operation. This framework is reviewed periodically keeping in mind the business dynamics and external environment and provides the guidelines for managing the various risks across the business.

The Financial Statements are prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time, the provisions of the Act (to the extent notified) and guidelines issued by the Securities and Exchange Board of India (SEBI). The Ind AS are prescribed under Section 133 of the Companies Act, 2013 (‘the Act), read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016. The Company has adopted all the Ind AS standards and the adoption was carried out in accordance with applicable transition guidance. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

The directors confirm that: i. In the preparation of the annual accounts for the year ended March 31, 2023 the applicable accounting standards have been followed along with proper explanation relating to material departures if any; ii. 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 as at March 31, 2023 statement of Profit & Loss, statement of changes in equity and statement of cash flows of the Company for the year ended on that date; iii. the Directors had taken proper and sufficient care for the 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 had prepared the annual accounts of the Company on a ‘going concern basis. v. the Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are reasonably adequate and operating effectively; and vi. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are reasonably adequate and operating effectively.

The Board of Directors met 9 (Nine) times in the financial year 2022-23. The details of the board meetings and the attendance of the Directors are provided in the Corporate Governance Report. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.

The Company has an orientation programme upon induction of new Directors as well as other initiatives to update Directors on a continuous basis. The Familiarization Programme of the Company will provide information relating to the Company, wind energy / renewable energy industry, business model of the Company, geographies in which Company operates, etc. The programme also intends to improve awareness of the Independent Directors on their roles, rights, responsibilities towards the Company. Further, the Familiarization Programme should also provide information relating to the financial performance of the Company and budget and control process of the Company. The format of the letter of appointment is available on our website, http://orientgreenpower.com/files/DRAFT-LETTER-OF-APPOINTMENT-OF-INDEPENDENT-DIRECTOR.pdf

Mr. T Shivaraman has been appointed as Managing Director & CEO of the Company for a period of 3 years with effect from 30th March 2022 till 29th March 2025 and the same has been approved by the shareholders at the Annual General Meeting held on 30th June 2022. Mr. N Rangachary, has retired from the position of Chairman, Independent Director of the Company and Maj.Gen. A L Suri (Retd), has retired from the position of Independent Director of the Company with effect from 2nd November 2022 as per unanimous decision taken by the Board of Directors at their meeting held on 2nd November 2022.

Mr. P Krishna Kumar (DIN: 01717373) retires by rotation and being eligible, offers himself for re-appointment in accordance with the provisions of Section 152(6) and the Articles of Association of the Company. A resolution seeking shareholders approval for his re-appointment forms part of the Notice.

Mr. K S Sripathi has been appointed as Chairman, Independent Director of the Company for a period of 3 years with effect from 3rd November 2022 till 02nd November 2025 and the same has been approved by the shareholders through Postal Ballot Process. b) Independent Directors:

The Company has received declarations from each independent directors of the Company under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence as laid down in Section 149(6) of the Act.

Further the Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act.

c) Key Managerial Personnel:

There has been no change in the Key Managerial Personnel during the year except for the details as mentioned in point (a) above.

The Company has following committees of the Board:

1. Audit Committee

2. Nomination & Remuneration Committee

3. Stakeholders Relationship Committee

4. Risk Management Committee

5. Investment/Banking/Borrowing Committee

6. Corporate Social Responsibility Committee

7. Rights Issue Committee

A detailed note on the composition of the Board and its committees are provided in the Corporate Governance Report as part of this Annual Report.

All the related party transactions that were entered into during the Financial Year 2022-23 were on an arms length basis and in the ordinary course of business. There are no materially significant Related Party transactions made by the Company with Promoters, Directors or Key Managerial

Personnel etc. which may have potential conflict with the interest of the company at large.

All Related Party Transactions are presented to the Audit Committee and the Board. A statement of all related party transactions was presented before the Audit Committee specifying the nature, value and terms and conditions of the transactions.

The Related Party Transactions Policy as approved by the Board is uploaded on the Companys website at http:// orientgreenpower.com/files/Policy-on-Related-Party-Transactions.pdf.

The details of the material contracts or arrangements i.e. transactions with Related Parties during the year, are provided in the accompanying financial statements and also in form AOC-2 is appended as Annexure 1 to the Boards Report.

In compliance with the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the performance evaluation of the Board was carried out during the year under review.

The Company has always provided a congenial atmosphere for work to all the employees that is free from discrimination and harassment including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex. There were no complaints reported during the financial year under the said policy.

1. The Auditors Report for the year 2022- 2023 does not contain any qualification, reservation or adverse remark. The Auditors Report is forming part of the financial statements in this Annual Report.

2. The Secretarial Auditors Report for the year 2022- 2023 does not contain any qualification, reservation or adverse remark. The Secretarial Auditors Report is enclosed as Annexure 2 to the Boards report.

3. As required by the Listing Regulations, the auditors certificate on corporate governance is enclosed. The auditors certificate for Year 2022-2023 does not contain any qualification, reservation or adverse remark.

4. The Company is in compliance with Regulation 24A of the Listing Regulations. The Companys unlisted material subsidiaries undergo Secretarial Audit. Copy of Secretarial Audit Reports of Beta Wind Farm Private Limited, Bharath Wind Farm Limited and Clarion Wind

Farm Private Limited are enclosed as Annexure 3, 4 & 5 respectively.

M/s. G.D.Apte & Co, Chartered Accountants (Firm Registration No. 100515W) had been appointed as Statutory Auditors of the Company as per Section 139 of the Companies Act, 2013 for a period of 5 years from the conclusion of Tenth Annual General Meeting till the conclusion of Fifteenth Annual General Meeting, by the members at the Annual General Meeting held on August 09, 2017.

Further, the members at the Annual General Meeting held on 30th June 2022 re-appointed M/s. G.D.Apte & Co, Chartered Accountants as the statutory auditors of the Company, for a second term of five consecutive years, from the conclusion of the Fifteenth Annual General Meeting till the conclusion of the Twentieth Annual General Meeting to be held in the year 2027.

Internal Audit of the company and its subsidiaries are handled by the Internal audit department of the company. The Internal Audit evaluates the adequacy of internal controls by adopting a systematic approach.

The annual audit plan, coverage, frequency of the audits are directed by the Audit committee. Independence of Internal Auditor is ensured by direct reporting to the Audit Committee of the Board.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. M Alagar & Associates, Practicing Company Secretary, CP No. 8196 were appointed as Secretarial Auditors for the financial year 2022-23, to audit the secretarial and related documents of the Company.

In compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended, your Company has instituted a comprehensive Code titled as "Code of Conduct to regulate, Monitor and Report trading by Insiders" which lays down guidelines and advises the Directors and Employees of the Company on procedures to be followed and disclosures to be made while dealing in securities of the Company.

The policy provides the framework in dealing with securities of the Company. Details of the policy are available on our website, at http://orientgreenpower.com/files/Code-of-Conduct-to-Regulate-Monitor-and-Report-Trading-by-Insiders.pdf

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rule 2014, is appended as Annexure- 6 to the Boards report.

The Information as required under Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure- 7 to the Boards report. The Information as required under Rule 5(1) & Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in an annexure forming part of this Annual report. In terms of the first provision to Section 136 of the Act, the report and accounts are being sent to members excluding the aforesaid Annexure. Any member interested in obtaining the same may write to the Company Secretary at the registered office of the Company. None of the employees listed in the said annexure are related to any directors of the Company.

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

During the year under review, the Company has complied with all the applicable Secretarial Standards.

Annual Return of the Company is available on our website at http://orientgreenpower.com/annual-report.asp

The details of the major policies approved and adopted by the Board as per SEBI Regulations are as follows:

The company has adopted a whistle blower mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud, or violation of the companys code of conduct and ethics. Details of the policy are available on our website, at http://orientgreenpower. com/files/Whistle-Blower-Policy.pdf

The policy applies to disclosures of material events affecting the Company and its subsidiaries. Details of the policy are available on our website, at http://orientgreenpower. com/files/POLICY-ON-CRITERIA-FOR-DETERMINING-MATERIALITY-OF-EVENTS.pdf

This policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of the director (Executive/ non-executive) and also the criteria for determining the remunerations of the Directors, Key Managerial Personnel, Senior Management. Details of the policy are available on our website, at http://orientgreenpower.com/files/Code-of-Conduct-Directors-and-Senior-Management.pdf

The policy outlines the companys strategy to bring about a positive impact on society through programs relating to hunger, poverty, education, healthcare, environment and lower its resource footprint. Details of the CSR policy are available on our website, athttp://orientgreenpower.com/ files/Policy-on-CSR.pdf

The policy is used to determine the material subsidiaries of the company. Details of the policy are available on our website, at http://orientgreenpower.com/files/Policy-on-Material-Unlisted-Subsidiary-Company.pdf

The policy regulates all transactions between the company and its related parties. Details of the policy are available on our website, at http://orientgreenpower.com/files/Policy-on-Related-Party-Transactions.pdf

The policy deals with the retentions and archival of corporate records of the Company and all its subsidiaries. Details of the policy are available on our website, at http://orientgreenpower.com/files/ARCHIVAL-POLICY.pdf

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement and monitor the risk management plan for the Company.

The Committee is responsible for monitoring and reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The Details of policy on Risk management is available on the website of the Company at http://orientgreenpower.com/files/Risk-Management-Policy.pdf

Policy is to set out guidelines as to return to the shareholders that cash, which in the opinion of the board, is in excess to the short and medium term cash requirements and facilitate the process of dividend recommendation or declaration and its pay-out by the company which would ensure a regular dividend income for the shareholders and long term capital appreciation for all stakeholders of the company. Details of the Policy are available on our website at http://orientgreenpower.com/files/Dividend-Distribution-Policy.pdf

The Nomination and Remuneration Committee of the Board (‘NRC) oversees matters relating to succession planning of Directors, Senior Management and other Key Executives of the Company.

Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules), any Application money received by the company for allotment of securities and due for refund shall be transferred to the IEPF established by the Central Government, after the completion of seven years. Further, according to the Rules, the amounts which have not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the IEPF account created by the IEPF Authority. Accordingly, on 5th October 2017 unclaimed Share Application money amounting to Rs. 16,750 has been transferred to IEPF account as per the requirements of the IEPF rules.

The Listing Regulations mandate the inclusion of the BRSR as part of the Annual Report for the top 1,000 listed entities. Even though for the financial year 2022-23 as per Market Capitalization criteria, the company falls below the thresholds, the Company shall continue to comply as per regulation 3 of the SEBI(LODR). In compliance with the Listing Regulations, Our Business Responsibility and Sustainability Report forms part of this Annual Report.

• The Company complies with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India

• Neither the statutory auditors nor the secretarial auditor, internal auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees.

• The Company does not have any scheme or provision of money for the purchase of its own shares by employees/ Directors or by trustees for the benefit of employees/ Directors; and

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

Electronic copy of the Annual Report for FY 2023 and the Notice of the ensuing AGM is being sent to all shareholders whose email addresses are available in demat account and registered with Companys Registrar and Share Transfer Agent. As per the General Circular No. 20/2020 of Ministry of Corporate Affairs dated May 5, 2020, shareholders holding shares in demat form are requested to update their email addresses with their Depository Participant(s) and for shareholders holding shares in physical form, should get their email registered with Cameo Corporate Services Limited, Companys Registrar and Share Transfer Agent.

Your Directors wish to convey their deep appreciation to all the employees, customers, vendors, investors, Bankers, Financial Institutions for their sincere and dedicated services as well as their collective contribution to the Companys performance.

Your Directors also thank the Government of India, Government of various States in India and concerned Government Departments for their co-operation.