Pakka Ltd Directors Report

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Pakka Ltd Share Price directors Report

Dear Members,

The Directors have pleasure in presenting their 42nd Annual Report and Audited Financial Statements for the year ended 31st March 2023.

1. Financial Results:

Rs. In Lakhs

Particulars

Standalone

Consolidated

For the year ended March 31

For the year ended March 31

2023 2022 2023 2022

I. Revenue from operations

40,830.82 29,108.63 40,830.82 29,108.63

II. Other income

1,158.47 813.25 1,160.29 813.25

III. Total Income

41,989.29 29,921.88 41,991.11 29,921.88

IV. Expenses

Cost of materials consumed

15,402.18 11,746.92 15,402.18 11,746.92

Purchase of stock-in-trade

578.25 6.18 578.25 6.18

Changes in inventories of finished goods, work-in-progress and stock-in-trade

219.81 -124.56 219.81 -124.56

Employee benefits expenses

4,792.11 3,557.01 5,010.34 3,736.38

Finance costs

1,112.91 936.26 1,126.28 939.62

Depreciation and amortization expenses

1,272.79 1,021.54 1,274.65 1,021.54

Other expenses

11,380.07 7,409.21 11,687.07 7,475.48

Total Expenses (IV)

34,758.12 24,552.56 35,298.58 24,801.56

V. Profit before Tax (III - IV)

VI. Tax expense:

7,231.17 5,369.32 6,692.53 5,120.32

1. Current tax

2. Deferred tax

1,434.61 980.00 1,434.61 980.00

3. Tax adjustments relating to earlier years

650.32 565.11 650.32 565.11

VII. Profit for the period (V - VI)

0.00 4.19 0.00 4.19

VIII. Other comprehensive income

5,146.24 3,820.02 4,607.60 3,571.02

(i) Items that will not be reclassified to profit or loss Re-measurements of the defined benefit plans

-38.13 -67.51 -38.13 -67.51

(ii) Income tax related to items that will not be reclassified to profit or loss

11.10 19.66 11.10 19.66

(iii) Foreign Currency Transition Reserve

- - 8.67 -0.71

(vi) Non-Controlling Interest

- - 3.31 0.00

Sub Total

-27.03 -47.85 -18.36 -48.56

IX. Total comprehensive income for the period (VII - VIII)

5,119.21 3721.17 4589.24 3,522.46

X. Earnings per equity share

1. Basic

13.51 10.03 12.10 9.38

2. Diluted

13.45 10.03 12.04 9.38

2. PERFORMANCE REVIEW

2.1 CONSOLIDATED

The Operative Revenue stood at H40,830.82 lakhs in FY23 compared to H29,108.63 lakhs in FY22 on a consolidated basis. There was an increase of 40.27% in Operative Revenue in comparison to last financial year. The Consolidated Profit after tax in FY23 was at H4,607.60 lakhs compared to H3,571.02 lakhs in FY22. There was an increase of 29.03% in consolidated profit after tax.

2.2 STANDALONE

The Operative Revenue stood at H40,830.82 lakhs in FY23 compared to H29,108.63 lakhs in FY22 on a standalone basis. There was an increase of 40.27% in Operative Revenue in comparison to last financial year. The Standalone Profit after tax in FY23 was at H5,146.24 lakhs compared to H3,820.02 lakhs in FY22. There was an increase of 34.72% in standalone profit after tax.

2.3 PRODUCTION AND SALES

Your Company has reported following production and sales:

(Rs. In lakhs)

Name of Products

Unit of

Productions

Sales

Measurement Current Year 31.03.2023 Previous Year 31.03.2022 Current Year 31.03.2023 Previous Year 31.03.2022

Kraft Paper

MT 22,384 22,824 22,332 22,332

Poster Paper

MT 17,384 16,315 17,308 16,183

Total Paper

MT 39,768 39,139 39,631 38,515

Pulp

MT 10,134 8,872 9,710 8,815

Moulded (Tableware) Products

MT 2,018 1,630 2,327 1,596

Pith Pallet

MT 6295 6,639 5,096 4,934

Egg Tray

Pieces in Lakhs 140.38 117.08 132.85 117.37

2.4 ANNUAL PERFORMANCE

Details of your Companys annual performance are published on the Companys website and presented during the Investors Meet. The same can be accessed under the Investors Meet tab in the Investor Section of the website of the Company: www.pakka.com.

3. DIVIDEND

Based on the Companys performance, the Directors have recommended a final dividend of 24% (H2.40 per equity share) for the year ended 31st March, 2023 subject to approval of the members at ensuing Annual General Meeting.

(Rs. In lakhs)

Particulars

As at 31st March, 2023 As at 31st March, 2022

Final Dividend for the year ended H2.40 per share (P.Y. H2 per share)

913.88 761.57

Total

913.88 761.57

Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of the Members w.e.f. April 1, 2020 and the Company is required to deduct tax at source (TDS) from dividend paid to the Members at the prescribed rates as prescribed under the Income-tax Act, 1961.

The dividend on equity shares, if approved by the members, would involve a cash outflow of H913.88 lakhs.

4. TRANSFER TO RESERVES

As per Standalone financials, the net movement in the reserves of the Company For FY23 and FY22 is as follows:-

(Rs. In lakhs)

Particulars

As at

31st March, 2023

As at

31st March, 2022

Capital Reserve

37.32 37.32

Securities Premium

1,172.16 1,172.16

Employees Share Base payment Reserve

227.15 -

General Reserve

550.00 550.00

Retained Earnings

15,692.41 11,253.18

Other Comprehensive Income

(138.60) (111.57)

Total

17,540.44 12,955.65

5. SUBSIDIARIES/JOINT VENTURES/ASSOCIATES

We, along with our subsidiaries, provide manufacturing, consulting, technology, outsourcing and marketing services. We had 3 subsidiaries i.e., Pakka Inc, an USA-based Company, Pakka Pte Ltd, a Singapore based subsidiary company

and Pakka Impact Limited, an India based subsidiary company. The financial transactions of the said subsidiary during the year are included in the Consolidated Financial Statements of the Company.

During the year, the Board of Directors reviewed the affairs of the subsidiary. In accordance with Section 129(3) of the Companies Act, 2013, we have prepared the Consolidated Financial Statements of the Company, which form part of this Annual Report based on the financial statements certified by the Management of the subsidiary company. Further, a statement containing the salient features of the financial statements of our subsidiary in the prescribed format AOC- 1 as per Section 129(2) of the Companies Act, 2013 (the Act) is appended as Annexure - I to the Directors report. The statement also provides details of the performance and financial position of each of the subsidiary, along with the changes that occurred, during FY23.

Further, pursuant to the provisions of Section 136 of the Act, the audited financial statements including consolidated financial statements along with relevant documents of the Company and management certified financial statements of the subsidiaries are available under tab of Annual Report of Investor Section on the website of the Company www.pakka.com.

The policy for determining material subsidiaries of the Company has been provided in the following link under tab of Policy of Investor Section on the website of the Company www.pakka.com.

6. SHARE CAPITAL

The authorized share capital of the Company was H6005 lakhs divided into 565 lakhs equity shares of H10 each and 4 lakhs preference share capital of H100 each as on 31st March, 2023. the authorized share capital increased to H6,005 lakhs after merger of Yash Compostables Limited into the Company.

The paid up Equity Share Capital of the Company as on 31st March, 2022 was H3,524 lakhs. The paid up Equity Share Capital of the Company was increased to H3807.85 lakhs on 13th May, 2022 on account of merger of Yash Compostables Limited. The paid up Equity Share Capital of the Company is H3807.85 lakhs on 12th August, 2023 i.e. the date of Directors Report.

The Company has not issued shares with differential voting rights, employee stock options and sweat equity shares during the year under review.

The Company has paid Listing Fees for the financial year 2022-23 and 2023-24 to BSE Limited, where its equity shares are listed.

7. TSOP (ESOP) DISCLOSURE

Your Company has approved TSOP (ESOP) in the Board Meeting in the year 2019 i.e., Yash Team Stock Option Plan - 2019 and approved by the members of the Company in the 39th Annual General Meeting held on September 20, 2019 and further medication approved in the 40th Annual General Meeting held on 31st October 2020, which was not implemented.

The Members of the Company in their Extra Ordinary General Meeting held on May 6, 2022 approved the new scheme Yash Team Stock Option Plan - 2021 (TSOP/Plan), in super session of earlier Special Resolution passed by the Members of the Company as aforesaid and authorised the Board (including Compensation Committee) to create, offer, issue, reissue, grant, transfer and allot from time to time, and in one or more trenches, such number of Team (Employee) Stock Options (hereinafter referred to as "Options"), under the YASH TEAM STOCK OPTION PLAN - 2021 (New TSOP) and to issue fresh options, reissue options that may lapse/ get cancelled/ surrendered in future under the New TSOP in complete suppression of any earlier team member (employee) stock option plan of the Company and to issue and allot such number of Equity Shares of the Company H10 (Rupees ten only) each not exceeding 20,00,000 (Twenty Lakhs) Equity Shares, representing in the aggregate 5.68 % (approx.) of the issued, paid-up and subscribed share capital of the Company (as on April 01, 2022) at such price or prices, and on such terms and conditions, as may be determined by the Board in accordance with the provisions of New TSOP and in due compliance with the SBEB Regulations and other applicable laws, rules and regulations, to or to the benefit of the eligible team members i.e. employees/ directors of the Company (i.e. Eligible Beneficiaries as defined in the New TSOP)

Thereafter, the Nomination and Remuneration Committee (Compensation Committee) of the Board of Directors of the Company ("NRC") in its meeting held on July 7, 2022 has granted 14,16,600 stock options of the Company to 361 number of the eligible Team members in terms of TSOP at an exercise price of H82.21 (Rupees Eighty-Two and Twenty-One paisa Only) per Share.

The disclosure relating to ESOPs required to be made under the provisions of the Companies Act, 2013 and the rules made thereunder and the Securities and Exchange Board of India (Share Based Employee Benefit and Sweat Equity) Regulations, 2021 ("SBEB Regulations") is provided on the website of the Company www.pakka.com under Investor Section.

A certificate obtained from the Secretarial Auditors, confirming that the TSOP (ESOP) Schemes of the Company are in compliance with the SBEB Regulations

Annual Report 2022-23

and that the Company has complied with the provisions of the Companies Act, 2013 and the SBEB Regulations is also provided in Annexure - II forming part of this Report.

8. HUMAN RESOURCE DEVELOPMENT

A key area of focus for your Company is to create a performance driven workforce while ensuring the health and well-being of employees and their families.

Many policies and benefits were implemented to maximize employee engagement and welfare. Your Company also continues to endeavour to create a work environment which is collaborative and learning and growth oriented to enable employees to perform at their full potential. Our Human Resource (HR) strategy adopts a multipronged approach covering all the key facets of employee development.

Learning as a stated value of the Company also sets the tone of your Companys aim to develop competencies to rise to new challenges especially posed by ventures into new business areas.

9. CREDIT RATING

During the year under review, the Company has given mandate for Credit Rating, however the same is under evaluation till the date of report.

10. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANIAL YEAR AND DATE OF THE REPORT

There have been no material changes and commitments which affect 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.

11. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COM PANYS OPERATIONS IN FUTURE

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

12. SCHEME OF ARRANGEMENT BETWEEN THE COMPANY AND YASH COMPOSTABLES LIMITED

The Board of Directors and Members of the Company had approved a scheme of arrangement between (i) the Company, its shareholders and creditors, and (ii) Yash Compostables Limited (YCL) and its shareholders and creditors (the "Scheme"). The Scheme contemplates the merger by absorption of YCL by the Company. The Scheme had been approved by the Honble National Company Law Tribunal, Allahabad Bench vide order dated April 18, 2022 and Stock Exchange had also given its final approval to the Company. YCL has been dissolved without winding up basis on terms and conditions as detailed in the Scheme.

Subsequent to the year under review, 28,38,500 Equity Shares of Face Value of H10/- each of Pakka Limited has been allotted on 13.05.2022 to the Shareholders of Yash Compostables Limited (i.e. 56.77 (Fifty-Six point Seventy-Seven) Equity Shares of Face Value of H10/- each of Pakka Limited to the Shareholders of Yash Compostables Limited for every 1 (One) Equity Share of Face Value of H10/- each held by the Shareholders of Yash Compostables Limited) pursuant to Clause 8.1 of the Scheme of Merger by Absorption as approved by the Honble National Company Law Tribunal, Allahabad Bench vide order dated 18" April, 2022.

13. DEPOSITS

During the year under review, the Company has not accepted deposits from the public falling within the ambit of section 73 of the Companies Act, 2013 and the rules framed thereunder, and the requisite returns have been filed. The Company does not have any unclaimed deposits as of date.

14. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Companys internal control systems are commensurate with the nature of its business, the size and complexity of its operations and such IFCs with reference to the Financial Statements are adequate. The Company has designed and implemented a process driven framework for Internal Financial Controls ("IFC") within the meaning of the explanation to section 134(5)(e) of the Companies Act, 2013.

Your Company has appointed Mahajan & Aibra., Chartered Accountants, Mumbai as Internal Auditor of the Company. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism.

The Audit Committee of the Board of Directors, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken. Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

15. CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the Listing Regulations, Report on Corporate Governance along with the certificate from a Practicing Company Secretary certifying compliance with conditions of Corporate Governance forms part of this Annual Report.

16. VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behaviour. In line with its Code of Conduct, any actual or potential violation, howsoever insignificant or perceived as such, would be a matter of serious concern for the Company. The role of the employees in pointing out such violations of the Code of Conduct cannot be undermined.

Pursuant to Section 177(9) of the Act, a vigil mechanism was established for directors and employees to report to the management instances of unethical behaviour, actual or suspected, fraud or violation of the Companys code of conduct or ethics policy. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairman of the Audit Committee of Directors of the Company for redressal. No person has been denied access to the Chairman of the Audit Committee of Directors.

The Company has a Whistle Blower Policy to report genuine concerns or grievances & to provide adequate safeguards against victimization of persons who may use such mechanism. The Whistle Blower Policy has been posted on the website of the Company under Policy Tab of Investor Section on www.pakka. com.

17. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made thereunder.

The Policy aims to provide protection to employees at workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.

The Company has revisited the Internal Complaints Committee members and emphasized on the roles and responsibilities expected from the members. Posters and Banners were refreshed with the list of committee members and strengthened the awareness of zero tolerance through campaigns.

Opening as on 01.04.2022

Received during FY 2022-23 Redressed during FY 2022-23 Closing as on 31.03.2023

0

0 0 0

18. RISK MANAGEMENT

Risk management is embedded in your Companys operating framework. Your Company believes that managing risks helps in maximizing returns. The Companys approach to addressing business risks is comprehensive and includes periodic review of such risks and a framework for mitigating controls and reporting mechanism of such risks. The risk management framework is reviewed periodically by the Board and the Audit Committee.

19. SECRETARIAL STANDARDS:

The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS- 2, relating to Meetings of the Board of Directors and General Meetings, respectively, have been duly followed by the Company.

20. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

As per the requirement of Section 186(4) of Companies Act, 2013, particulars of loans given, investments made, guarantees given or securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the Standalone Financial Statements

Annual Report 2022-23

forming a part of the Annual Report. The Company is in compliance with the limits as prescribed under Section 186 of Companies Act, 2013 read with Rule 11 of the Companies (Meeting of Board and its Powers) Rules, 2014.

21. RELATED PARTY TRANSACTION

In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy on Related Party Transactions and the Policy on Materiality of Related Party Transactions and the same can be accessed under Policy Tab of Investor Section on www.pakka.com.

During the year under review, all transactions entered into with related parties were approved by the Audit Committee of the Board. Certain transactions, which require the approval of the Board, were approved by the Board also. During the year, the Company had not entered into any contract, arrangement or transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which are required to be reported in Form No. AOC-2 in terms of Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

The disclosures as required under Part A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are provided in accordance with Ind AS 24 in the notes to Standalone Financial Statements.

22. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Board of Directors of the Company has adopted a Corporate Social Responsibility (CSR) Policy as available under Policy tab of Investors Section on the website www.pakka.com of the Company on the recommendation of CSR Committee and this policy has been amended from time to time to ensure its continued relevance and to align it with the amendments to applicable provisions of law. The Company undertakes CSR activities in accordance with the said Policy.

The Company undertakes majority of CSR through Pakka Foundation (Previously known as K. K. Charitable Foundation). Pakka Foundation works along with the Board and the CSR committee in order to identify and implement CSR initiatives of the Company. Key CSR initiatives of the Company focus on Women Education, Child Development, Water Conservation, Healthcare and Sanitation. During the year under review, the Company has spent H137.75/- Lakhs for its CSR activities during the financial 2022-23.

The disclosures required to be given under section 135 of the Companies Act, 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in Annexure - III forming part of this Directors Report.

The Chief Financial Officer of the Company has certified that CSR funds so disbursed for the projects have been utilized for the purposes and in the manner as approved by the Board.

23. AUDITORS OBSERVATION:

23.1 STATUTORY AUDITOR REPORT

The Statutory Auditor of the Company has given unqualified report during the year under review.

23.2 SECRETARIAL AUDITOR REPORT

The Secretarial Auditor of the Company has given unqualified report during the year under review.

24. DIRECTORS:

24.1 CHANGES IN DIRECTORS

The Members of the Company at their Extra Ordinary General Meeting held on 6th May, 2022, approved the re-appointment of Mr. Narendra Kumar Agarwal (DIN - 05281887) as Director (Works). However, Mr. Narendra Kumar Agarwal has resigned from directorship of the Company with effect from 30th July, 2022 due to personal and unavoidable circumstances.

Further, the Members of the Company at their Extra Ordinary General meeting held on 6th May, 2022 had also approved the reappointment of Mr. Pradeep Vasant Dhobale as an Independent Director for the second term of five years w.e.f. 25.09.2022.

Further, the Members of the Company at their Extra Ordinary General meeting held on 6th May, 2022 had also approved the appointment of Mr. Ved Krishna as Vice Chairman (Non-Executive) of the Company.

Further, the Members of the Company have approved re-appointment of Mr. Basant Kumar Khaitan (DIN: 00117129) for the 2nd term as an Independent Directors at the 42nd Annual General Meeting of the Company.

Further, the Board of Directors of the Company has approved the appointment of Mr. Shubham Ashok Tibrewal (DIN: 10274024) as an Additional Director (Independent Director) of the Company in the meeting of Board of Directors held on 12th August, 2023.

In accordance with the requirements of the Act and the Companys Articles of Association, Mrs. Kimberly Ann McArthur (DIN: 05206436), Director of the Company, retires by rotation is eligible for re-appointment. Members approval is being sought at the ensuing AGM for her re-appointment.

24.2 CHANGES IN KEY MANAGERIAL PERSONNEL

There are following changes in the Key Managerial Personnel during the year.

Mrs. Bhavna Kodarbhai Patel (Membership No.A31586), Company Secretary & Compliance Officer (KMP) of the Company has resigned from the post of Company Secretary & Compliance Officer with effect from August 1, 2022 due to personal reasons.

Mr. Sachin Kumar Srivastava (Membership No.F11111), Legal Head of the Company has been appointed to the post of Company Secretary and Legal Head of the Company with effect from 10th August, 2022.

Mr. Jignesh Shah has resigned from the post of Chief Financial Officer with effect from 24th November, 2022 due to his health issues.

Mrs. Neetika Suryawanshi has been appointed on the post of Chief Financial Officer with effect from 26th December, 2022.

25. DECALARATION OF INDEPENDENCE

The Company has received Declarations of Independence as stipulated under section 149(7) of the Companies Act, 2013 and Regulation 25(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 from Independent Directors confirming that he/she is not disqualified from being appointed/re-appointed/ continue as an Independent Director as per the criteria laid down in section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The same are also displayed on the website of the Company www.pakka. com under Investor Section.

The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Companies Act, 2013.The Independent Directors of the Company have registered themselves with

the data bank maintained by Indian Institute of Corporate Affairs (IICA). In terms of section 150 of the Companies Act, 2013 read with Rule 6(4) of the Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors are exempted from undertaking the online proficiency self-assessment test conducted by IICA.

26. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors has carried out an annual evaluation of its own performance, Board committees and individual Directors pursuant to the provisions of the Act and the Listing Regulations. The performance of the Board was evaluated by the Board after seeking inputs from all the Directors based on criteria such as the Board composition and structure, effectiveness of Board processes, information and functioning, etc. The performance of the Committees was evaluated by the Board after seeking inputs from the Committee members based on criteria such as the composition of Committees, effectiveness of Committee meetings, etc.

In a separate meeting of Independent Directors, performance of NonIndependent Directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of the Executive Director and NEDs. The Nomination and Remuneration Committee reviewed the performance of individual Directors on the basis of criteria such as the contribution of the individual Director to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. The above criteria are broadly based on the Guidance note on Board Evaluation issued by the Securities and Exchange Board of India on 5th January, 2017. In a subsequent Board meeting, the performance of the Board, its Committees and individual Directors was also discussed. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.

27. POLICY ON BOARD DIVERSITY AND DIRECTOR ATTRIBUTES AND REMUNERATION POLICY FOR SENIOR DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES

In terms of the provisions of Section 178(3) of the Act and Regulation 19 read with Part D of Schedule II to the Listing Regulations, the Nomination and Remuneration Committee is responsible for determining qualification, positive

attributes and independence of a Director. The Nomination and Remuneration Committee is also responsible for recommending to the Board, a policy relating to the remuneration of the Directors, KMP and other employees.

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to Executive and Non-executive Directors (by way of sitting fees and commission), Key Managerial Personnel, Senior Management and other employees. The policy also provides the criteria for determining qualifications, positive attributes and Independence of Director and criteria for appointment of Key Managerial Personnel / Senior Management and performance evaluation which are considered by the Nomination and Remuneration Committee and the Board of Directors while making selection of the candidates. The above policy has been posted on the website of the Company under Policy Tab of Investor Section at www.pakka.com.

28. DIRECTORS RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls (IFCs) and compliance systems established and maintained by the Company, the work performed by the Statutory, Secretarial and Internal Auditors and external consultants, including the audit of IFCs over financial reporting by the Statutory Auditors and the reviews performed by management and the relevant Board Committees, including the Audit Committee of Directors, the Board is of the opinion that the Companys IFCs were adequate and effective during FY23. Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirm that:

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

b) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

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

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

e) They have laid down internal financial controls to be followed by the Company and that 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 that such systems are adequate and operating effectively.

29. BOARD AND COMMITTEES OF THE BOARD

29.1 Board Meetings

8 Board Meetings were held during the year under review. For further details, please refer to the Report on Corporate Governance, which forms a part of this Annual Report.

29.2 Committees of the Board

The Committees of the Board focus on certain specific areas and make informed decisions in line with the delegated authority. The following statutory Committees constituted by the Board function according to their respective roles and defined scope:

¦ Audit Committee

¦ Nomination and Remuneration Committee

¦ Corporate Social Responsibility Committee

¦ Stakeholders Relationship Committee

Details of composition, terms of reference and number of meetings held for respective Committees are given in the Report on Corporate Governance, which forms a part of this Annual Report.

The Company has adopted a Code of Conduct for its employees including the Managing Director. In addition, the Company has adopted a Code of Conduct for its Non-Executive Directors which includes the Code of Conduct for Independent Directors which suitably incorporates the duties of Independent Directors as laid down in the Act. The same can be accessed in Policy Tab of Investor Section at www.pakka.com. All Senior Management personnel have

affirmed compliance with the Code of Conduct of the Company. The Managing Director has also confirmed and certified the same. The certification is enclosed as Annexure - I at the end of the Report on Corporate Governance.

30. AUDITORS

30.1 STATUTORY AUDITORS

Under Section 139(2) of the Companies Act, 2013 and the Rules made thereunder, it is mandatory to rotate the statutory auditors on completion of two terms of five consecutive years and each such term would require approval of the shareholders. In line with the requirements of the Companies Act, 2013, Statutory Auditor CNK & Associates LLP, Chartered Accountants (ICAI Firm Registration Number 101961W/W-100036) were re-appointed for the 2nd term as Statutory Auditor of the Company at the 42nd AGM held on 30th October, 2022 to hold office from the conclusion of the said meeting till the conclusion of the 47th AGM to be held in the year 2027.

During the year, the statutory auditors have confirmed that they satisfy the independence criteria required under the Companies Act, 2013, the Code of Ethics issued by the Institute of Chartered Accountants of India.

30.2 SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Act and rules made thereunder, the Company has appointed Amit Gupta & Associates, Practicing Company Secretaries (C.P.No.4682) to undertake the Secretarial Audit of the Company for the financial year ended 31st March, 2023.

The Secretarial Audit Report confirms that the Company has complied with the provisions of the Act, Rules, Regulations and Guidelines and that there were no deviations or non-compliances. The Secretarial Audit Report is provided in Annexure - IV to this Report.

The Secretarial Audit Report does not contain any qualifications, reservations, adverse remarks or disclaimers.

30.3 INTERNAL AUDITORS

The Board of Directors of the Company in its meeting held on 29th April, 2022 has appointed Mahajan & Aibra, Chartered Accountants, Mumbai of the Company as Internal Auditor of the Company for conducting the Internal Audit for the financial year ended 31st March, 2023.

30.4 COST AUDITORS

As per the requirements of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company is not required to appoint cost auditors and maintain cost records.

31. REPORTING OF FRAUDS

There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of Act and Rules framed thereunder.

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

Your Company is a pioneer in propagating energy conservation and operational efficiency with the objective of providing substantial benefit to customers in the form of reduced emissions, pollutants and deliver cost effective and environment friendly energy solutions.

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as Annexure - V and forms an integral part of this Report.

Annual Report 2022-23

33. EXTRACT OF ANNUAL RETURN

Pursuant to Section 92 of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company as on 31st March, 2023 is available on the Companys website and can be accessed at www.https://www.pakka.com/investors.

34. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis, as required in terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") is provided in a separate section and forms an integral part of this Annual Report.

35. PARTICULARS OF EMPLOYEES

DETAILS PERTAINING TO REMUNERATION 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

The information required pursuant to Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as follows:

. The percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer, Company Secretary during the financial year 2022-23, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2022-23 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:

Name of Directors / KMP

Remuneration of the Director / KMP in F.Y.2022-23 (Rs. In lakhs) Remuneration of the Director / KMP in F.Y.2021-22 (Rs. In lakhs) % Increase in F.Y.2022-23 (Rs. In lakhs) Ratio (times) of the remuneration of each director to the median remuneration of the employees

Mr. Ved Krishna, Vice-Chairman

2.67 48.11

-*

0.59

Mr. Jagdeep Hira, Managing Director (KMP)

246.76 193.20 2772% 54.32

Mr. Narendra Kumar Agrawal, Director Works

20.41 45.08

-*

4.49

Mrs. Neetika Suryawanshi, Chief Financial Officer (KMP)

21.31 - - 4.69

Mr. Sachin Kumar Srivastava, Company Secretary & Compliance Officer (KMP)

19.49 - - 4.29

Mr. Jignesh Shah, Chief Financial Officer (KMP)

48.83 62.34 -21.67%* 10.75

Ms. Bhavna Patel, Company Secretary & Compliance Officer (KMP)

6.79 19.51 -65.20%* 1.49

*The figures are not comparable due to resigned / worked for part of the financial year only.

ii. The median remuneration of employees of the Company during FY23 was H4,54,303/- in comparison to H3,88,172/- during the FY22.

iii. In the financial year, there was an increase of 17.04% in the median remuneration of employees;

iv. There were 464 permanent employees on the rolls of the Company during the FY23 in comparison to 472 permanent employees on the rolls of the Company during FY22.

v. Average percentage increase made in the salaries of employees other than the managerial personnel in FY23 was 18.45 % whereas the decrease in the managerial remuneration for the same financial year was 0.54%. The figures for managerial remuneration are not comparable to last year due to appointment/changes made in managerial person during the said period.

vi. The key parameters for the variable component of remuneration availed by the directors are considered by the Board of Directors based on the recommendations of the Human Resources, Schedule V of the Companies Act, 2013, Nomination and Remuneration Committee as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees; and

vii. It is hereby affirmed that the remuneration paid is as per the as per the Schedule V of the Companies Act, 2013, Remuneration Policy for Directors, Key Managerial Personnel and other Employees.

viii. Except Mr. Jagdeep Hira, Managing Director of the Company, no other employee was employed throughout the financial year at an aggregate salary of H1,02,00,000/- per annum.

ix. Except, Mr. Jagdeep Hira, Managing Director, no other employee was employed for a part of the financial year at an aggregate salary of H8,50,000/- per month.

. Details of Top Ten employees of the company as required under Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

as amended vide Notification dated 30th June, 2016 by Ministry of Corporate Affairs for the year ended 31st March, 2023:

Sl. No. Name & Age

Qualification Designation Date of Joining No. and % of equity shares held Remuneration Previous

employment

1 Mr Jagdeep Hira (51 Years, 2 Month)

Bachelor of Engineering Technology Managing

Director

10/10/2016 Nil 2,46,76,152 Trident Group Limited

2 Mr Jignesh Vinodchandra Shah (52 Years, 3 Month)

Chartered Accountant Chief Financial Officer 01/06/2020 Nil 59,93,374 Gerresheimer

3 Mr Narendra Kumar Agrawal (52 Years)

Bachelor of Engineering Director Works 15/12/2011 500 (0.00%) 53,98,050 Century Paper and Pulp

4 Mr Manoj Kumar Maurya (48 Years, 9 month)

M.Com Commercial Head 01/09/1998 Nil 36,67,687 ->

5 Thomas James (41 Years, 6 Month)

BE & MBA Operations Head 03/11/2022 Nil 36,33,383 MRF Tyres

6 Mr Neeraj Kamra (50 Years, 2 Month)

PGDM in Pulp & Paper Production Head 25/02/2019 Nil 31,40,069 Shree Rishabh Paper

7 Ms. Navina John (44 Years)

Master in Human Resource Management Admin & IR Head 17/05/2018 Nil 30,91,283 Muthoot Finance Ltd.

8 Sachin Kumar Srivastava (38 years)

CS, Cost Accountant, LLb, MBA, PGDCA, M.Com Company Secretary & Legal Head 15/05/2006 100 24,49,145

9 Shailesh Singh (43 Years)

Master in International Business Paper Sales Head 23/01/2017 Nil 23,59,652 -

10 Anoop Kumar (42 Years)

Diploma in Electrical Engineering Electrical Head 01/10/2016 Nil 20,91,576 -

*Mr. Jignesh Vinodchandra Shah resigned from the post of Chief Financial Officer of the Company w.e.f. 24th November, 2022 and from the Company w.e.f. 7th January, 2023

xi. No employee of the Company receiving remuneration part of the financial year in excess of the amount drawn by the Managing Director No one was employed throughout the financial year or part thereof receiving remuneration in excess of the amount drawn by the Managing Director

36. COMPANIES WHICH CEASED TO BE HOLDING, SUBSIDIARY OR ASSOCIATE COMPANY

During the year under review, no company ceased to be holding, subsidiary or associate company of the Company.

37. INVESTOR EDUCATION AND PROTECTION FUND

During the year, the Company was not required to transfer any amount and shares to Investor Education and Protection Fund ("IEPF").

38. CAUTIONARY STATEMENT

Statements in this Directors Report and Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, expectations or predictions may be "forward-looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Companys operations include raw material availability and its prices, cyclical demand and pricing in the Companys principal markets, changes in Government regulations, Tax regimes, economic developments within India and the countries in which the Company conducts business and other ancillary factor.

39. GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the year under review:

¦ The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year, as no such proceedings initiated or pending.

¦ The details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, as there was no instance of onetime settlement with any Bank or Financial Institution.

40. ACKNOWLEDGEMENTS

On behalf of the Directors of the Company, I would like to place on record our deep appreciation to our shareholders, customers, business partners, vendors (both international and domestic), bankers, financial institutions and academic institutions for all the support rendered during the year.

The Directors are thankful to the Government of India, the various ministries of the State Governments, communities in the neighbourhood of our operations, municipal authorities of Ayodhya, Uttar Pradesh and local authorities in areas where we are operational in India; as also partners, governments and stakeholders in international geographies where the Company operates, for all the support rendered during the year.

The Directors appreciate and value the contributions made by all our Team Members and their families for making the Company what it is.

Place: Lucknow Date: 12th August, 2023

For and on Behalf of the Board

Pradeep Vasant Dhobale

Chairman DIN: 00274636

Form AOC-1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014) Statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures

Part "A": Subsidiaries

(Information in respect of each subsidiary to be presented with amounts in H)

I. Pakka Impact Limited

Sl. No. Particulars

Details

1. Name of the subsidiary

Pakka Impact Limited

2. Reporting period for the subsidiary concerned, if different from the holding companys reporting period

Not Applicable

3. Reporting currency and Exchange rate as on the last date of the relevant financial year in the case of foreign subsidiaries

Not Applicable

4. Share capital

2, 00,00,000

5. Reserves & surplus

-3, 17,82,082

6. Total assets

3, 19,40,598

7. Total Liabilities

3, 19,40,598

8. Investments

-

9. Turnover

21, 75,000

10. Profit/(loss) before taxation

-3, 17,82,082

11. Provision for taxation

-

12. Profit after taxation

-3, 17,82,082

13. Proposed Dividend

-

14. % of shareholding

97.50%

Pakka Inc, an USA based Company

Sl. No. Particulars

Details

1. Name of the subsidiary

Pakka Inc, an USA based Company

2. Reporting period for the subsidiary concerned, if different from the holding companys reporting period

Not Applicable

3. Reporting currency and Exchange rate as on the last date of the relevant financial year in the case of foreign subsidiaries

1 USD = 82.2169

4. Share capital

3,76,01,000

5. Reserves & surplus

-6,34,96,894

6. Total assets

2,48,46,974

7. Total Liabilities

2,48,46,974

8. Investments

-

9. Turnover

-

10. Profit/(loss) before taxation

-3,91,12,062

11. Provision for taxation

-

12. Profit after taxation

-3,91,12,062

13. Proposed Dividend

-

14. % of shareholding

100%

III. Pakka Pte Ltd, a Singapore based Company

Sl. No. Particulars

Details

1. Name of the subsidiary

Pakka Pte Ltd, a Singapore based Company

2. Reporting period for the subsidiary concerned, if different from the holding companys reporting period

Not Applicable

3. Reporting currency and Exchange rate as on the last date of the relevant financial year in the case of foreign subsidiaries

1 SGD = 61.7543

4. Share capital

1,72,73,550

5. Reserves & surplus

-12,18,716

6. Total assets

1,73,30,295

7. Total Liabilities

1,73,30,295

8. Investments

-

9. Turnover

2,11,004

10. Profit/(loss) before taxation

-12,18,716

11. Provision for taxation

-

12. Profit after taxation

-12,18,716

13. Proposed Dividend

-

14. % of shareholding

100%

ESOP Certificate

[PURSUANT TO REGULATION 13 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (SHARE BASES EMPLOYEE BENEFITS

AND SWEAT EQUITY REGULATIONS, 2021]

The Board of Directors,

Yash Pakka Limited,

(CIN -L24231UP1981PLC005294)

2nd Floor, 24/57 Birhana Road,

Kanpur, Uttar Pradesh - 208001

Dear Sir(s)

Sub: Secretarial Auditors Certificate for the Year ended March 31, 2023, in accordance with Regulation 13 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat equity) Regulations, 2021.

We have examined the records and documents maintained by Yash Pakka Limited ("the Company") and based on the information and explanations given to us and to the best of our knowledge and belied, We confirm that the following schemes of the Company for the year ended March 31, 2023 have been implemented in accordance with the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat equity) Regulations, 2021, as amended and in accordance with the respective resolutions of the Company passed in the general meeting.

Sr. No. Scheme

Details of Shareholders meeting regarding approval/amendment of the Scheme

1. YASH TEAM STOCK OPTION PLAN - 2021

May 06, 2022

This Certificate has been issued on the request of the management of the Company and is solely for the purposes as stated in Regulation 13 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat equity) Regulations, 2021. This certificate should not be used for any other purposes.

For Amit Gupta & Associates Company Secretaries

Amit Gupta Proprietor

Membership No. : F5478 C. P. No. 4682

UDIN - F005478E000433059 Date: May 30, 2023 Place: Lucknow

Report on Corporate Social Responsibility

1. Brief outline on CSR Policy of the Company

The CSR projects of the Company are focused on communities that are disadvantaged, vulnerable and marginalized. The Company strives to contribute positively to improve their standard of living, through its interventions in Education, Skill development, Employment, health and sanitation.

The Companys CSR Policy as available on www.pakka.com under Policy tab of Investor Section framework details the mechanisms for undertaking various programmes in accordance with Section 135 of the Companies Act, 2013 (the Act) for the benefit of the community.

2. Composition of the CSR Committee

Sr. No Name of Director

Designation / Nature of Directorship Number of meetings of CSR Committee held during the year Number of meetings of CSR Committee attended during the year

1. Mrs. Kimberly Ann McArthur

Chairperson (Promoter Director) 1 1

2. Dr. Indroneel Banerjee

Vice-Chairperson (Independent Director) 1 1

3. Mr. Ved Krishna

Member (Promoter Director) 1 1

4. Mrs. Manjula Jhunjhunwala

Member (Promoter Director) 1 1

3. Provide the web-link where Composition of CSR committee, CSR Policy and CSR projects approved by the board are disclosed on the website of the Company

The Composition of the CSR Committee, CSR Policy Framework and CSR Projects approved by the Board are available in the Investor Section on the website https:// pakka.com/investors/ of the Company.

4. Provide the details of Impact assessment of CSR projects carried out in pursuance of sub-rule (3) of rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, if applicable (attach the report).

The provisions regarding Impact assessment of CSR projects carried out in pursuance to sub-rule (3) of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable to the Company.

5. Details of the amount available for set off in pursuance of sub-rule (3) of rule 7 of the Companies (Corporate Social responsibility Policy) Rules, 2014 and amount required for set off for the financial year, if any

Sr. No Financial Year

Amount available for set-off from preceding financial years (In lakhs) Amount required to be set off for the financial year, if any (In lakhs)

1. 2022-23

- -

6. Average net profit of the Company as per Section 135(5): H79.31 Lakhs.

7. (a) Two percent of average net profit of the Company as per section 135(5): H79.31 Lakhs.

(b) Surplus arising out of the CSR projects or programmes or activities of the previous financial years: NIL

(c) Amount required to be set off for the financial year, if any: NIL

(d) Total CSR obligation for the financial year (7a+7b-7c): 79.31 Lakhs

8. (a) CSR amount spent or unspent for the financial year:

The Company was required to spend an amount of H79.31 lakhs as CSR expenditure during FY2023.

Total Amount Spent for the Financial Year (H in Lakhs.)

Total Amount transferred to Unspent CSR Account as per

Amount Unspent

Amount transferred to any fund specified under Schedule VII as per second proviso to section 135(5) Name of the Fund Amount Date of transfer

Amount Date of transfer

137.75

NIL - - NIL -

b) Details of CSR amount spent against ongoing projects for the financial year:

Sl. No.

Name of the Project

Item from the list of activities in schedule VII to the Act

Local Area (Yes/ No)

Location of the Project

Project duration (in years)

Amount allocated for the

Amount spent in the Current

Amount trans- ferred to Unspent CSR Account for the

Mode of Imple- men-

Mode of Implementation - Through Implementing Agency

State District

project (in H)

Financial Year (in H)

project as per section 135(6) (in H)

tation - Direct (Yes/ No)

Name CSR registration number

Not Applicable

C. Details of CSR amount spent against other than ongoing projects for the financial year:

Sl.

No.

Name of the Project Item from the list of activities in Schedule VII to the Act Local

Area

(Yes/No)

Location of the Project

State District

Location of the Project Mode of Implementation - Direct (Yes/No) Mode of Implementation - Through Implementing Agency Name CSR registration number

1

Woman Education and Water Conservation (i) and (ii) Yes Uttar Ayodhya Pradesh 137.75 No Pakka Foundation CSR00010697 (Earlier known as K. K.

Charitable Foundation)

d. Amount spent in Administrative Overheads: NIL

e. Amount spent on Impact Assessment, if applicable: NIL

f. Total amount spent for the Financial Year (8b+8c+8d+8e): H137.75 Lakhs. g. Excess amount for set off, if any: N.A.

Sl. Particulars

Amount

No.

(Rs. In lakhs)

(i) 2% of average net profit of the company as per section 135(5)

79.31

Amount available for set-off from preceding financial year 2021-22

-

Amount required to be spent in the financial year 2022-23

79.31

(ii) Total amount spent for the financial year

137.75

(iii) Excess amount spent for the financial year [(ii)-(i)]

NIL

(iv) Surplus arising out of the CSR projects or programmes or activities. of the previous financial years, if any

NIL

(v) Amount available for set off in succeeding financial years[(iii)-(iv)]

58.44

9. (a) Details of unspent CSR amount for the preceding three financial years:

Sl. Preceding No. Financial Year

Amount transferred to Unspent CSR Account under section 135 (6) (in H) Amount Spent in the reporting Financial Year (in H) Amount transferred to any fund specified under Schedule VII as per section 135(6) if any

Name of the Amount Date of Fund (in H) Transfer

Amount remaining to be spent in succeeding financial Years (in H)

Not Applicable

(b) Details of CSR amount spent in the financial year for ongoing projects of the preceding financial year(s): NA

Sl. Project ID Name of the No. Project

Financial Year in which the project was commenced Project

duration

Total amount spent on the allocated for the project in the reporting project (in H) financial year (in H). Cumulative amount spent at the end of reporting financial year (in H) Status of the project - Completed / On-going

Not Applicable

10. In case of creation or acquisition of capital asset, furnish the details relating to the asset so created or acquired through CSR spent in the financial year. (asset-wise details)

a) Date of creation or acquisition of the capital asset(s) - NA

b) Amount of CSR spent for creation or acquisition of capital asset - Nil

c) Details of the entity or public authority or beneficiary under whose name such capital asset is registered, their address etc. - NA

d) Provide details of the capital asset(s), created or acquired (including complete address and location of the capital asset). NA

11. Specify the reason(s), if the company has failed to spend 2% of the average net profit as per section 135(5) - Not Applicable

Jagdeep Hira

Managing Director

DIN: 07639849 Place: Lucknow Date: 12th August, 2023

Dr. Indroneel Banerjee

Vice-Chairperson CSR Committee DIN: 06404397 Place: Lucknow

Form No. Mr.3 Secretarial Audit Report

FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2023

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014]

To,

The Members,

Yash Pakka Limited,

(CIN -L24231UP1981PLC005294)

2nd Floor, 24/57 Birhana Road,

Kanpur, Uttar Pradesh - 208001

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by M/s Yash Pakka Limited (CIN - L24231UP1981PLC005294) (hereinafter referred as "the Company"). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the Companys books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit,

We hereby report that in our opinion

i. The Company has, during the audit period covering the financial year ended on 31st March, 2023 complied with the statutory provisions listed hereunder; and also

ii. The Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter.

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2023 according to the provisions of:

i. The Companies Act, 2013 (the Act) and the rules made there under;

ii. The Securities Contracts (Regulation) Act, 1956 (SCRA) and the rules made there under;

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

iv. Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

v. The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (SEBI Act):-

a) The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations");

b) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 ("ICDR Regulations");

c) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 ("Takeover Regulations");

d) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 ("Buyback Regulations") - (Not applicable to the listed entity during the review period);

e) The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, Regulations 2021 ("SBEB Regulations");

f) The Securities and Exchange Board of India (Issue and Listing of NonConvertible and Redeemable Preference Shares) Regulations, 2021 ("Nonconvertible Securities Regulations") - (Not applicable to the listed entity during the review period);

g) The Exchange Board of India (Delisting of Equity Shares) Regulations, 2021 ("Delisting Regulations") - Not applicable as the listed entity has not made any delisting during the year under report;

h) Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

i) Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies and dealing with client - Not applicable as the listed entity is not registered as Registrar to Issue and Share Transfer Agent during the financial year under review;

j) Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 ("DP Regulations");

vi. The following other laws on account of the nature of industry are specifically applicable to the Company:

(a) The Boilers Act, 1923;

(b) The Explosives Act, 1884;

(c) Acts and Rules prescribed under prevention and control of pollution;

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by the Institute of Company Secretaries of India; and

(ii) Listing Agreement entered into by the Company with BSE Limited,

During the period under review, the Company has complied with the provisions of the Act, and the Rules, Regulations, Guidelines, Standards, etc. mentioned above.

We further report that:

¦ The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.,

¦ Adequate notice is given to all directors to convene the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting for meaningful participation at the meeting.

¦ Majority decisions are carried through, while the dissenting members views, if any, are captured and recorded as part of the minutes.

We further report that the systems and processes in the Company require further strengthening and improvements, considering the size and operations of the Company to enable better monitoring and ensuring of timely compliance with applicable laws, rules, regulations and guidelines.

We further report that during the audit period there were following material event having bearing on the affairs of the Company:

(i) Honble National Company Law Tribunal (NCLT), Allahabad Bench vide its order dated 18.04.2022 (certified true copy issued on 20.04.2022) has approved a Scheme of Merger by Absorption of Yash Compostables Limited ("YCL" or the "Transferor Company") and Yash Pakka Limited ("YPL" or "Transferee Company") and their respective shareholders with appointed date of 01.04.2020, in termsof the provisions of Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 read with the Rules framed thereunder;

(ii) The shareholders of the Company in their extra ordinary general meeting held on May 06, 2022 approved the new Scheme YASH TEAM STOCK OPTION PLAN - 2021 (TSOP/ Plan), in supersession of earlier special resolution passed by the Shareholders of the Company in 39th Annual General Meeting held on 20th September, 2019 and further modification approved in the 40th meeting held on October 31, 2020. During the financial year 2022-23 the Company has granted 14,16,600 stock options of the Company to the eligible employees in terms of TSOP.

(iii) A case under the Environment (Protection) Act, 1986 before the Honble National Green Tribunal, Principal Bench, New Delhi vide O.A. No. 116/2014 titled as Meera Shukla V. Municipal Corporation, Gorakhpur has been disposed off vide order dated September 13, 2022, however the recovery certificate of H40.80 lacs as an Environmental Compensation issued by Uttar Pradesh Pollution Control Board in compliance of order dated 27.09.2019 passed by the Honble National Green Tribunal, Principal Bench, New Delhi in aforesaid case, continues stayed in

terms of order dated 14.01.2020 passed by the Honble High Court of Judicature at Allahabad, Lucknow Bench, Lucknow in Case No. MISB 866 of 2020 titled as Yash Pakka Limited Vs. U. P. Pollution Control Board & Others.

For Amit Gupta & Associates Company Secretaries

OiQf*

Amit Gupta Proprietor

Membership No. : F5478 C.P. No. 4682

UDIN - F005478 D000778877 Date: May 30, 2023 Place: Lucknow

Note: This report should be read with the letter of even date by the Secretarial Auditors.

Conservation of Energy, Technology Absorption, Foreign Exchange

Earning and Outgo Etc:

Information on conservation of Energy, Technology absorption, Foreign Exchange earnings and outgo required to be disclosed under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are provided hereunder:

1. CONSERVATION OF ENERGY

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO ETC:

Information on conservation of Energy, Technology absorption, Foreign Exchange earnings and outgo required to be disclosed under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are provided hereunder:

2. CONSERVATION OF ENERGY

(A) ENERGY CONSERVATION MEASURES TAKEN

I. ETP sump pit pump replaced with energy efficient pump.

II. PP1 cooling water pumps replaced with energy efficient pump.

III. Installation of FRP blade in PP-2 cooling tower fan.

IV. Installation of VFD on PP1 cooling tower Fan

V. Tableware vacuum pumps replaced from 250 KW to 160 KW

VI. Tableware vacuum pump line modification

VII. Steam traps replacement in PM3 HMP heater

VIII. Broke tower agitator motor size reduction from 22 Kw to 18.5 Kw

(B) ADDITIONAL INVESTMENT AND PROPOSALS, IF ANY, BEING IMPLEMENTED FOR REDUCTION OF CONSUMPTION OF ENERGY

I. Installation of VFD on pulp mill caustic pump.

II. Micro turbine for 65 to 14 kg/cm2 PRDS.

III. Installation of VFD on PP2.

IV. PM-3 vacuum pump replacement on felt with a single vacuum pump.

V. Installation of FRP blades on chemical recovery evaporator cooling tower fans.

VI. Installation of online oxygen analyzer and optimize excess air in boiler 5

VII. Replacement of MPS pump with energy efficient pump

VIII. Downsize of UTM agitator Pulper motor in PM3

IX. Installation of pressure based VFD on BSW 1,2&4 dilution pump

X. Installation of level control loop VFD on Hypo Tower pump

XI. Installation of level control loop VFD on Alkali tower pump

XII. Replacement of 132KW,975 RPM motor of TDR by 110 KW,750 RPM.

XIII. Steams trap replacement in Recovery boiler air preheaters.

(C) IMPACT OF THE MEASURES OF THE ABOVE

I. Reduction of power from 1073 KW/MT to 939 KW/MT of Paper.

II. Reduction of steam from 10.62 MT/MT to 9.81 MT/MT of Paper.

III. Reduction of power from 5542 KW/MT to 5127 KW/MT of Moulded (Tableware) Products.

(D) TOTAL ENERGY CONSUMPTION AND ENERGY CONSUMPTION PER UNIT OF PRODUCTION AS PER PRESCRIBED FORM A OF THE ANNEXURES IN RESPECT OF THE INDUSTRIES SPECIFIED IN THE SCHEDULE THERETO.

I. POWER AND FUEL CONSUMPTION

Particulars

Current Year Previous Year
31.03.2023 31.03.2022

(a) Electricity

(i) Purchased Unit (lakhs)

37.53 Nil

Total Amount (Rs. In lakhs)

322.57 Nil

Rate / Unit (H)

8.59 Nil

(ii) Own generation

Nil Nil

Through Diesel Generator

Unit (lakhs)

3.48 1.37

Unit per litter of Diesel Oil

3.10 3.12

Cost / Unit (H)

29.56 24.36

Through Steam Turbine

Unit (lakhs)

608.73 613.88

Unit per MT of fuel (Paddy husk)

1367 1197

Cost / Unit (H)

4.40 2.42

Notes: *Steam Turbine is extraction cum condensing type hence fuel allocation is on estimated basis.

Particulars

Current Year 31.03.2023 Previous Year 31.03.2022

(a) Coal Quantity (MT)

Nil Nil

(b) Furnace Oil Quantity (Kilo litre)

Nil Nil

(i) Paddy Husk Quantity (MT)

91559 102280

Total Cost (Rs. In lakhs)

5504.77 2961.45

Average Rate (H)

6012 2895

(ii) Baggase / Pith Quantity (MT)

51173 30695

Total Cost (Rs. In lakhs)

1362.33 475.24

Average Rate (H)

2662.00 1548.24

II. CONSUMPTION PER UNIT OF PRODUCTION

a. Paper (Including Egg Tray & Pith Pallets)

Particulars

UOM Current Year Previous Year
31.03.2023 31.03.2022

Electricity

Units 1073 1091

Furnace Oil

Litre Nil Nil

Coal

MT Nil Nil

Paddy Husk

MT 1.35* 1.35*

Baggase Pith

MT 3.00* 3.00*

b. Moulded (Tableware) Products

Particulars

UOM Current Year Previous Year
31.03.2023 31.03.2022

Electricity

Units 5606 5542

(E) STEPS TAKEN BY THE COMPANY FOR UTILIZING ALTERNATE SOURCE OF ENERGY.

Since inception the Company is using Biomass as a fuel for generating the Steam. In year 1995, the Company installed a 2.5 MW and in 2007, a 6 MW cogeneration power plant using biomass (rice husk and pith) as fuel. The Company has also installed a Black liquor (Pollutant generated during pulping of Agro waste raw material) fired Boiler, generating steam and thereby power.

(F) CAPITAL INVESTMENTS ON ENERGY CONSERVATION EQUIPMENTS.

Total Capital investment on energy conservation equipment during FY23 is approximate 21,00,000/-

3. TECHNOLOGY ABSORPTION

EFFORTS MADE IN TECHNOLOGY ABSORPTION AS PER PRESCRIBED FORM B of the Annexure.

(A) Specific areas in which R & D & Innovation is carried out by the Company R&D

I. Successful production of high Burst factor (33+) paper at PM-3.

II. Optimisation of pulping & papermaking parameters & successful production of certain grades of Kraft paper without long fibre.

III. Lab evaluation of different grades of Oil & Grease resistance chemicals for paper.

IV. Lab evaluation of Bagasse to generate seasonal trends for Strength properties.

V. Lab evaluation of different types of Retention Aids, Drainage aids & plant trial for optimisation.

VI. Lab evaluation & plant scale trial of colour removal chemicals at Effluent Treatment plant.

VII. Lab evaluation of different types of Dry Strength Additives.

VIII. Lab evaluation & plant scale trial of Bio based Cooking Aids for Food grade application.

IX. Lab evaluation & plant trials of DEP dark shade paper.

X. Plant trials of removal of moisture from lime sludge ~18%.

XI. Plant trials of Strength improvement in Egg trays.

XII. Chemical cost reduction in overall process.

XIII. Plant trials for biodegradable packaging in Reels.

XIV. Pilot plant trials for black liquor viscosity reduction.

Innovation

I. Flexi pack trial using different grades of paper and biopolymers.

II. Trial for the manufacturing of cutlery and carry bags from mineral pellets.

III. Trial and validation on the water absorption reduction for delivery containers

IV. Exploration of the chemical (wet end / dry end) for PFAS free delivery containers.

(B) Benefits derived as a result of the above R & D

Above efforts have resulted in quality improvements, cost reduction, better

realization, waste reduction.

High moisture barrier property for flexi pack, patent filed for flexi pack, successful pilot trials for injection molded spoon using lime sludge, reduced water absorption percentage for delivery containers.

(C) Future plan of action R&D

¦ Development of High strength paper 035)

¦ Development of grease proof paper for Flexible packaging.

¦ Adoption of Compostable packaging

¦ Scientific disposal of lime sludge

¦ Check bagasse strength & yield with seasoning & without seasoning.

¦ Establishment of ant scale at pulp mill

¦ From raw material to paper machine monitor all centric leaner & rejects point at pulpmill to make a material balance to know how much good fiber we are loosing.

¦ Optimisation of Retention aid & drainage programme

¦ Optimisation of PFAS free chemicals for moulded products.

¦ Removal of colour from back water at Paper machine.

Innovation

I. Development and exploration of coating material for high water / oxygen barrier properties for flexi pack.

II. Development of delivery containers with less water absorption percentage and good retention time.

III. Validation of delivery container with reduced water absorption percentage at different places / pan India.

IV. Exploration of dried lime sludge for thermoformed articles.

V. Utilization of lime sludge for the development of heat resistant cutlery.

VI. High strength and burst factor paper of carry or wrap

VII. Exploration of potato starch for value added applications.

VIII. Exploring home compostable options for cutlery. (Rs. In lakhs)

S. No. Particulars

Current Year 31.03.2023 Previous Year 31.03.2022

1. Capital

- -

2. Recurring

44.31 84.79

3. Total

44.31 84.79

4. Total R & D Expenditure as a percentage of total Turnover

0.11% 0.29%

(E) Technology absorption, adaptation and innovation

I. Efforts, in brief, made towards technology absorption, adaptation and innovation:-

a. Pope reel replacement at PM-1 with improved technology.

b. Hot air heater at PM-1.

c. Grinding & coating of MG cylinder at PM-1 & PM-2.

d. Ceramic tops for wire table at PM-3.

e. Replace Refiner disks at PM-1 & PM-2 with new design (fine Bar). f Usage of clarified back water in Hi pressure showers at PM-3.

II. Benefits derived as a result of the above efforts e.g. Product improvement, cost reduction, product development, import substitution etc.:-

Improvement in existing process and product quality, less qualities variations, improved productivity, cost reduction and reduction in use of imported softwood pulp, reduction in fresh water consumption

a. PM-1 reel winding improvement and wastage reduction.

b. Air temperature rise with the same energy consumption.

c. MG surface improvement resulting in Paper quality enhancement.

d. PM-3 wire table drainage and paper formation improvement.

e. Fibre strength improvement with less cutting& more fibrillation.

f Fresh water reduction at PM-3 by using clarified machine back water for felt conditioning Hi pr showers.

III. Imported Technology (Imported during the last five years reckoned from the beginning of the financial year)

Not Applicable

4. FOREIGN EXCHANGE EARNING AND OUTGO

Activities relating to exports; initiatives taken to increase exports; development of new export markets for products and services; and export plans;

The Company has continued thrust on exports.

Total foreign exchange used and earned

S. Particulars

Current Year Previous Year

No.

31.03.2023 31.03.2022

1. Used

26,18,34,674 41,74,64,769

2. Earned

92,85,42,342 67,89,83,695

To,

The Members,

Yash Pakka Limited,

(CIN -L24231UP1981PLC005294) 2nd Floor, 24/57 Birhana Road, Kanpur, Uttar Pradesh - 208001

Our Report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and process as were appropriate to obtain reasonable assurance about the correctness of the contents of the secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and books of accounts of the Company.

4. Wherever required, we have obtained the management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The Compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. Our examination was limited to the verification of procedure on test basis.

6. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

For Amit Gupta & Associates Company Secretaries

Amit Gupta Proprietor

Membership No. : F5478 C.P. No. 4682

UDIN - F005478 D000778877 Date: May 30, 2023 Place: Lucknow

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