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Pasupati Acrylon Ltd Directors Report

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Sep 3, 2025|10:04:39 AM

Pasupati Acrylon Ltd Share Price directors Report

Dear Members

Your Directors are pleased to present 42nd Annual Report of Pasupati Acrylon Limited (“the Company”) together with the Audited Financial Statements for the financial year ended 31st March, 2025.

In compliance with the applicable provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”), this report covers the financial results and other developments during the financial year ended 31st March, 2025 and upto the date of the Board meeting held on 19th May, 2025 to approve this report, in respect of the Company. FINANCIAL HIGHLIGHTS

A brief on the financial performance during the year under review as compared to the previous year is given below:-

(Rs. In Lakh)

Particulars

2024-25 2023-24

Revenue from Operations

62,143.18 57,522.82

Other Income

1,136.90 1,076.95

Profit before Depreciation, Interest & Tax

5,620.09 2,684.93

Finance Cost

249.62 257.73

Depreciation

598.60 586.99

Profit before Taxes

4,771.87 1,840.21

Tax Expenses for the year

1,233.75 521.22

Profit after Taxes

3,538.12 1,318.99

Total Comprehensive Income

3,537.09 1,308.25

The financial statements for the financial year ended 31st March, 2025 have been prepared in accordance with applicable Indian Accounting Standards (Ind AS), notified under Companies (Indian Accounting Standards) Rules, 2015, read with Section 133 and other relevant provisions of the Companies Act, 2013. In accordance with the provisions of Section 136 of the Companies Act, 2013 the audited financial statements of the Company are available on website of the Company www.pasupatiacrylon.com .

RESULTS OF OPERATIONS And STATE OF COMPANYS AFFAIRS

During the financial year 2024-25, the Company has successfully achieved the operational synergy and financial growth despite the industry challenges. The key highlights of the Companys performance during the financial year 2024-25 are as under:

• Revenue from Operations stood at Rs. 62,143.18 Lakh as against Rs. 57,522.82 Lakh in the previous financial year, representing an increase of 8.03% over the corresponding period of last financial year.

• EBIDTA was Rs. 5,620.09 Lakh as against Rs. 2,684.93 Lakh in the previous financial year, representing an increase of 109.31% over the corresponding period of last financial year.

• Profit after Tax was Rs. 3,538.12 Lakh as against Rs. 1,318.99 Lakh in the previous financial year, representing a growth of 168.24% over the corresponding period of last financial year.

Despite a dynamic business environment, the Company remains resilient and future-ready, committed to innovation, sustainability and continuous growth in the years ahead.

During the financial year 2024-25, the Companys exports of Acrylic Fiber were 2,604 MT as compared to last years exports 3,044 MT. The Company has exported to Dubai, Peru, Thailand, Morrocco, Tunisia, Nepal, Ukraine, Turkey, Algeria, Kenya, Brazil, Poland, Lebanon etc. and is exploring possibilities of increasing exports and it is hopeful to achieve better exports in the coming years. The export of CPP was 1,107 MT as against 177 MT during the previous year.

DIVIDEND

During the year under review the Board of Directors decided not to recommend any dividend for the financial year 2024-25.

DEPOSITS

During the year under review, your Company has neither accepted nor renewed any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Further, there are no outstanding and/or overdue deposits as at 31st March, 2025.

TRANSFER OF RESERVES

The Board of Directors of your company, has decided not to transfer any amount to the General Reserve for the year ended 31st March, 2025. MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review as stipulated under Regulation 34(2)(e) read with Schedule V of the SEBI Listing Regulations, is given as under:

a) INDUSTRY STRUCTURE AND DEVELOPMENT Acrylic Fibre

Acrylic Fibre is an integral part of the total textile fibre mix which satisfies clothing and other needs of an increasing population. Acrylic fibres are being extensively used for manufacturing various apparel such as sweaters, sportswear, socks, home furnishing, and industrial cloth due to their lightweight, flexibility and low cost. With the rapid growth of the apparel & textile industry and increasing usage of acrylic fibres for making apparel, the overall acrylic fibre market is projected to rise at 4.2% CAGR till 2035. Factors such as a rapidly growing population, changing lifestyle, increasing disposable income, and flourishing fashion industry are expected to indirectly influence the growth of acrylic fibre during the next ten years. The demand for acrylic fibers is anticipated to rise in the coming years, particularly due to the macroeconomic development of end-use sectors which is supported by regional GDP and population growth.

CPP Film

Packaging industry is an enormous economic generator on a global scale and is one of the largest & highest growth sectors of the Indian economy. Cast Polypropylene or CPP packaging films have several beneficial properties from industrial perspective such as transparency, high impact strength, heat sustainability, dimensional stability, printability and are manufactured using high grade raw materials, and laminating aspects. The global market for CPP packaging films is expected to reach US$ 8,742.2 Mn by 2033, growing at a 4.2% CAGR till 2033. CPP packaging films are readily used to increase the shelf life of the products in the industries such as food, beverages, apparel, cosmetics, and healthcare products. With the rising requirement for packaging across sectors, with traditional businesses preferring to package products, and the retail and e-commerce growing rapidly, the CPP films industry is projected to expand at a robust rate.

ETHANOL

Across the globe, Ethanol is gaining strategic importance as a key enabler of the clean energy transition. The global ethanol market is anticipated to register a CAGR of 6.8% from 2023 to 2032. This growth is primarily fuelled by the growing usage of ethanol as a biofuel. The application of ethanol as a biofuel emerges as a key market driver, particularly as the automotive industry grapples with air pollution concerns and to reduce gasoline imports.

Ethanol has now become a crucial component of the Indias fuel demand. Ethanol blending has emerged as a key strategy to reduce Indias dependence on imported crude oil while advancing its clean energy agenda. India has successfully achieved its 20% ethanol blending target (E20), well ahead of schedule·a major milestone in the countrys energy transition journey. With this goal now met, the focus is shifting toward higher blending levels and broader applications of ethanol across sectors.

The Indian ethanol industry demonstrated remarkable resilience and growth during FY 2024-25, supported by progressive government policies, a focus on energy diversification, and the strong momentum of the Ethanol Blended Petrol (EBP) program. With the national target of achieving 20% ethanol blending by 2025, the sector witnessed accelerated investments in capacity expansion and technological innovation.

b) OPPORTUNITIES AND THREAT

The resilient economic outlook, driven by robust consumption demand, presents a mix of opportunities for the company. The usage of acrylic fibers in blends with other materials like wool, cotton, polyester, etc. is growing in popularity as a result of their favorable physical, chemical, and thermo biological properties. This will provide a strong thrust to the growth of the acrylic fiber market. The rapid growth of end-use sectors including apparel, home furnishing, and industrial will therefore continue to propel the sales of acrylic fibres in the upcoming years.

Global Acrylic Fibre consumption is impacted due to volatility in prices of raw material, energy, coal and other key inputs. The raw material to produce the Companys products is crude derived. The fluctuation in crude affects the raw material prices to some extent and during the year under the review, the crude prices remained volatile due to conflict in Israel-Hamas War & Russia-Ukraine War. Additionally, since the Company is dependent upon imports, the fluctuation in foreign exchange i.e. USD vs. INR has also a bearing on the margin of the Company.

The market for CPP Films is primarily driven by the rapidly expanding demand from the food and beverage sector and the rising use of bags and pouches in end-use industries. The market for CPP Films is expected to increase in the near future due to the rise in the consumption of convenience foods and the high need for packaging solutions. The development of consumer goods packaging has shown to be a major possibility for CPP film growth.

However, the market for CPP Film Market is moderately competitive owing to the presence of multiple vendors in the market. On the other hand, stringent regulations concerning packaging, changing consumer preferences and environmental pressures may restrain the growth to some extent.

Governments are increasingly adopting ethanol blending mandates to curb emissions, reduce reliance on imported fuels, and boost rural economies through agricultural value addition. While the ethanol policy has been marked by abrupt recalibrations, the long-term structural story remains intact driven by Indias decarbonization targets and the governments ethanol blending roadmap. The ethanol market has potential to grow beyond transportation, presenting new opportunities in aviation biofuels, bio-based chemicals, power generation and industrial applications for producers. One of the most pressing challenges that remain is climatic vagaries in this industry, and at times changes in government policies. Additionally, the continued absence of non-increase in Minimum Selling Price adjustments pose direct threats to forward planning, capacity utilisation, and return on invested capital

c) SEGMENT-WISE / PRODUCT-WISE PERFORMANCE Acrylic Fibre

The Companys Acrylic Fibre plant was set up in technical collaboration with SNIA BPD Italy, part of the famed FIAT group - a proven world leader in the manufacture of acrylic fiber. Advanced technology, automation, computerized process control systems and captive power, make the operations of your Company extremely efficient and reliable. The production capacity to produce Acrylic products of the Company is 42,000 MT PA. Your company is covering both domestic and export markets and the Companys products are well accepted.

During the year under review, the Company has recorded production of 35,198 MT and Sale of 33,850 MT, as against production of 31,534 MT and Sale of 31,685 MT respectively during the previous year. During the FY 2024-25, there is an increase of 11.61% and 6.83% in production and sales respectively over the previous year.

Revenue of Acrylic Fibre during the year under review was Rs. 53,810.27 Lakh as against revenue of Rs. 49,743.47 Lakh in the previous year. Profit before tax, exceptional items and interest was Rs. 5,047.77 Lakh as compared to Rs. 2,510.22 Lakh in the previous year.

CPP FILM

The Company installed European machinery which ensures quality product giving edge over other producers. The Companys production capacity to produce CPP film is 10000 MT PA.

During the year under review, the production and sale of CPP film was 6,343 MT and 6,409 MT respectively as against production of 6,463 MT and sale of 6,476 MT respectively during the previous year.

Revenue of CPP Films during the year under review was Rs. 8,066.67 Lakh as against revenue of Rs. 7,779.35 Lakh in the previous year. Loss before tax, exceptional items and interest was Rs. 30.62 Lakh as compared to loss of Rs. 412.28 Lakh in the previous year, reflecting an improvement of 92.57%. During the year under review, loss of CPP has been declined due to better realization and reduction in overheads.

During the year, the performance was marginally improved due to better sentiments in the market and it is expected to improve in the coming years.

ETHANOL

The Company has successfully commissioned its 150 KL per day grain-based Ethanol Plant and commenced commercial production in March, 2025. The total project cost was assessed Rs. 167 Crore (excluding working capital margin) but the project was overrun due to Civil work. Company has spent around Rs. 188 Crore so far which includes Rs. 104 Crore of Term Loan and Balance amount out of internal accruals.

During the year under review, the production and sale of Ethanol was 790 KL and 440 KL respectively. Revenue from Ethanol Segment was Rs. 266.24 Lakh and Profit before tax, exceptional items and interest was Rs. 4.34 Lakh. The purity of Ethanol produced by the company is 99.83% which is acceptable as very good.

d) OUTLOOK

Indias economic activity and GDP growth are expected to remain resilient despite ongoing geopolitical uncertainties. As a result, India is poised to become one of the major economies in the world with a promising growth outlook. Your Company anticipates sustained demand growth across segments.

According to Future Market Insights (FMI), India is expected to account for a substantial share of the global acrylic fibre market, owing to the rapid expansion of the textiles industry and the rise in the export of yarns and fibres. The rise in the number of textile industries in India is favoring the growth of the acrylic fibre market and the trend is likely to continue in the upcoming years. India is probably going to be the new development engine of the regions acrylic fibre market, propelled by a rising population, increasing disposable income, and changing lifestyle.

Demand for packaged foods is at an all-time high due to growing world population. Additionally, due to concerns about sanitation and health, consumers themselves prefer packaged meals. CPP films are also widely used in the pharmaceutical industry for packing pharmaceuticals to control the damage and contamination during transport. The global CPP Film Market is anticipated to rise at a considerable rate during the forecast period, between 2022 and 2027.

The Ethanol sector remains a cornerstone in Indias broader renewable energy and sustainability agenda. As per report of Expert Committee of Nity Aayog on Roadmap for Ethanol Blending, the demand for ethanol is expected to be 1016 Crore litres. The present ethanol production capacity in India is 426 Crore litres only. Considering the above gap, the ethanol market is anticipated to grow in the future. Improvements in logistics infrastructure, streamlined pricing mechanisms, and sustained policy support have collectively strengthened Indias position as one of the fastest growing ethanol markets globally.

The Company fully dedicates itself to quality and implements robust quality processes and systems at its manufacturing unit to ensure the safety and quality of its product. The Company consistently invests in equipment, processes, and systems to ensure full compliance with manufacturing and audit norms.

e) RISK AND CONCERN

At the start of Fiscal year 2025, global economy was facing challenges in the form of unresolved and on-going geopolitical tensions between Russia and Ukraine and the second one between Israel and Iran. Other geo-political tensions including supply chain disruption, subdued global economic conditions, changes in government policies and trade sanctions and restrictions, intense competition from local and global players, regulatory changes and cyber security threats are key risks which expose the Company to potential challenges and uncertainties. Furthermore, persistent volatility in input costs and foreign exchange risks remains on the radar. These factors can pose risks to the companys plans, operations, supply chains, cash flows and market access potentially dampening its export business.

Further, since the Company is dependent upon imported raw materials, movement in USD and increase in crude oil prices due to ongoing Israel-Hamas war and Russia-Ukraine war may affect the margin. The Company is giving thrust on increasing the exports so that effect can be mitigated. Global economy is likely to be hit by inflation, continuing high energy cost, logistics issues and costs in international trade. Tightening of monetary policies by Central banks to curb inflation may have necessary impact which will impact consumption in general including Acrylic Fiber & CPP Films Industry.

Since raw material is crude derived as such movement either side shall affect the raw material price. To mitigate the effect, the Company has entered into long term contracts with suppliers in films division.

The prices of ethanol products are determined by Oil Marketing Companies (“OMC”) and the Company has no control on the prices. Further, ethanol produced is primarily sold to OMCs for blending with petrol.

f) INTERNAL CONTROL SYSTEM AND ITS ADEQUACY

The Company maintains an adequate and effective Internal Control System commensurate with its size and complexity. It believes that these systems provide, among other things, a reasonable assurance that transactions are executed with management authorization. It also ensures that they are recorded in all material respects to permit preparation of financial statements in conformity with established accounting principles, along with the assets of the Company being adequately safeguarded against significant misuse or loss. An independent Internal Audit function is an important element of the Companys Internal Control System. The internal control is supplemented by an extensive programe of internal, external audits and periodic review by the Management. This system is designed to adequately ensure that financial and other records are reliable for preparing financial information and other data and for maintaining accountability of assets.

g) DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

Your company delivered a good performance despite global headwinds that exerted some pressure. Various cost optimisation driven by way of alternate sourcing, standardization, process improvements and operational efficiency improvements has led significant savings.

During the year under review, the Company registered Revenue from Operations of Rs. 62,143.18 Lakh as compared to Rs. 57,522.82 Lakh for previous year with a growth in revenue of 8.03 %. The Company reported Profit before Tax of Rs. 4,771.87 Lakh in the financial year, reflecting an increase of 159.31% over the previous years profit before tax of Rs. 1,840.21 Lakh. Net Profit in financial year 2024-25 increased to Rs. 3,538.12 Lakh from Rs. 1,318.99 Lakh, registering a growth of 168.24% over the previous financial year.

h) MATERIAL DEVELOPMENT IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT INCLUDING NUMBER OF PEOPLE EMPLOYED

The Company believes that their workforce is an invaluable asset for the Company and Company endeavors to ensure the well-being of all its employees. The safety, health and work life balance of employees are extremely important. Company made all the required efforts to ensure safety of all workforce and employees.

Development and Training of team has always been a focus area of management. The Human Resource Development continues to be focused on improving employee productivity, reducing employee cost and building necessary skillsets whilst building employee motivation through varied employee engagement initiatives. To augment technical strength in existing business areas, various technical trainings covering existing business are being conducted on a regular interval. Regular safety training is imparted to all personnel at factory and regular review of safety incidents is done by top management.

The Company employed on an average 514 persons during the year.

i) DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH Detailed EXPLANATIONS THEREFOR

In accordance with the SEBI Listing Regulations, the Company is required to give details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key financial ratios including the following ratios:

Particulars

Unit FY 2024-25 FY 2023-24 % change

Debtors Turnover Ratio

Times 11.72 10.74 9.12%

Inventory Turnover Ratio

Times 8.76 9.60 -8.75%

Interest Coverage Ratio1

Times 5.49 35.60 -84.57%

Current Ratio

Times 3.05 2.83 7.77%

Debt Equity Ratio1

Times 0.30 0.13 130.76%

Operating Profit Margin (%)2

% 7.94 3.58 121.78%

Net Profit Margin (%)2

% 5.59 2.25 148.44%

In addition to the above ratio, there was change of more than 25% in the following key financial ratio:

Particulars

Unit FY 2024-25 FY 2023-24 % change

Return on Capital Employed2

% 11.86 4.98 138.15%

Return on Net Worth2

% 10.21 4.09 149.63%

1 Debt-Equity Ratio and Interest Coverage Ratio were varied due to increase in Term Loan availed for Grain based Ethanol Plant and interest thereon.

2 Operating Profit Margin, Net Profit Margin, Return on Capital Employed and Return on Net Worth are favourable due to increase in profitability during the year.

CAUTIONARY STATEMENT

Some of the statements in this Management Discussions & Analysis, describing the Companys objectives, outlook, projections, estimates, expectations and predictions may be ‘forward looking statements within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied, since the Companys operations are influenced by external or internal factors. Your Company closely monitors all major developments likely to affect the operations and will respond to meet the potential threats and to gain from any possible opportunities.

SUBSIDIARY COMPANIES

As on 31st March, 2025, the Company does not have any subsidiary, associate or joint venture company.

CHANGE IN THE NATURE OF BUSINESS

During the year under review, there is no change in the nature of the business of the company. However, the Company has commenced the commercial production of its new segment - grain-based Ethanol Plant in March, 2025.

SHARE CAPITAL

As on 31st March, 2025, the Companys issued and paid up capital stands Rs. 89,13,31,210/- divided into 8,91,33,121 fully paid up equity shares of Rs. 10/- each. During the year under review, the Company has not issued any share. Further the Company has also not issued any share with differential Voting Rights/Sweat Equity shares/under Stock Option Scheme (ESOS) earlier and during the year. The Company has no scheme or provision of money for purchase of its own shares by employees or by trustees, for the benefit of its employees. Hence the details under rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 are not required to be disclosed.

DIRECTORS

During the year under review, there were the following changes in the Board of Directors of the Company.

1. Mr. Sathyamoorthy Srinivasan ceased to be independent director of the Company with effect from the close of business hours on 26th September, 2024 upon completion of his second term.

2. Mr. Raj Ganesh Viswanathan has been appointed as an Independent Director of the Company for a period of five years w.e.f 23rd August, 2024

In accordance with the provisions of section 152(6) of the Companies Act, 2013, not less than two-thirds of total number of directors shall be liable to retire by rotation, out of which one-third directors shall retire by rotation at every Annual General Meeting (“AGM”). However, “total number of directors” shall not include independent directors.

The Company has two Non-Independent Directors - Mr. Vineet Jain (Managing Director) and Mr. Satya Prakash Gupta (Director- Operations). Mr. Vineet Jain, being Managing Director, is not liable to retire by rotation by virtue of Articles of Association of the Company. Accordingly, Mr. Satya Prakash Gupta, Director -Operations will retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment.

Mr. Gupta is a chemical engineer and is possessing high level of expertise and having industry experience of about 46 years. Mr. Gupta has submitted his consent for re-appointment as Whole Time Director of the Company.

In the opinion of the Board, Mr. Satya Prakash Gupta possesses the requisite expertise, skills, integrity and experience for re-appointment/ continuance. The Board recommends his re-appointment/continuance and agenda seeking shareholders approval for his re- appointment/ continuance forms part of the AGM Notice.

As on 31st March, 2025, Mr. Deveshwer Kumar Kapila, Mr. S.C. Malik, Mr. Raj Ganesh Viswanathan and Mrs. Kamlesh Gupta are Independent Directors of the Company.

KEY MANAGERIAL PERSONNEL

As on 31st March, 2025, the Company had the following Key Managerial Personnel in accordance with the provisions of Section 203 of the Companies Act, 2013:

1. Mr. Vineet Jain- Managing Director

2. Mr. Satya Prakash Gupta-Director (Operations)

3. Mr. Satish Kumar Bansal- Chief Financial Officer

4. Mr. Bharat Kapoor - Company Secretary

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013 and Regulation 25(8) of SEBI Listing Regulations stating that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI Listing Regulations. All the independent directors of the Company are registered and are members of Independent Directors Databank maintained by Indian Institute of Corporate Affairs. Further, the Board after taking these declaration/disclosures on record and acknowledging the veracity of the same, concluded that the Independent Directors are persons of integrity and possess the relevant expertise and experience (including the proficiency) to qualify as Independent Directors of the Company and are Independent of the Management. Further, they are exempted from the requirement of passing the online proficiency self- assessment test.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than the sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committees of the Company.

MEETINGS OF THE BOARD

During the year under review, four meetings of the Board of Directors were held. The details of Board Meetings are set out in Corporate Governance Report which forms part of this Annual Report.

NOMINATION AND REMUNERATION POLICY

The Board, on the recommendation of the Nomination & Remuneration Committee, has framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Nomination and Remuneration Policy is available on the website of the Company www.pasupatiacrylon.com .

BOARD EVALUATION

The Company has devised a formal process for annual evaluation of performance of the Board, its Committees and Individual Directors (“Performance Evaluation”) which include criteria for performance evaluation of non-executive directors and executive directors as laid down by the Nomination and Remuneration Committee and the Board of Directors of the Company. It covers the areas relevant to the functioning as Independent Directors or other directors, member of the Board or Committee of the Board.

In terms of the applicable provisions of the Companies Act, 2013 and SEBI Listing Regulations, the Nomination & Remuneration Committee has carried out an annual performance evaluation of Board of Directors, of Boards committees and of each Board Member individually.

The performance of the committees was evaluated by the Nomination & Remuneration Committee after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness, structure & independence of committees, contribution to decisions of the Board etc.

The performance of the Board was evaluated on the basis of various criteria such as the board composition and structure, effectiveness of board processes, information and functioning, role & responsibilities and strategy & performance, Governance & compliance etc.

The Board and the Nomination and Remuneration Committee reviewed the performance of the individual directors on the basis of laid down criteria.

Independent Directors of the Company had, in their separate meeting held on 6th November, 2024, reviewed the performance of nonindependent directors, the Board as a whole and Managing Director of the Company, taking into account the views of Executive and NonExecutive Directors.

Further, the Independent Directors hold unanimous opinion that the Non-Independent Directors/Managing Director bring to the Board, abundant knowledge in their respective field and are experts in their areas. Besides, they are insightful, convincing, astute, with a keen sense of observation and have a deep knowledge of industry. They have been performing reasonably well, under the prevailing circumstances.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 134(3) (c) and 134(5) of the Companies Act, 2013, your Directors to the best of their knowledge and belief and according to the information and explanations obtained by them, hereby confirm:

a. That in the preparation of the annual accounts for the financial year ended 31st March, 2025; the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. That the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year ended 31st March, 2025 and of the profit of the company for the year ended on that date;

c. That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d. That the directors had prepared the annual accounts on a going concern basis;

e. That the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

f. That the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE GOVERNANCE

The company has complied with the Corporate Governance code as stipulated under SEBI Listing Regulations. A separate report on Corporate Governance, forming part of the Annual Report of the Company is annexed hereto.

SECRETARIAL STANDARDS

The Company complies with all applicable mandatory secretarial standards issued by the Institute of Company Secretaries of India.

PROCEEDINGS PENDING UNDER THE INSOLVENCY & BANKRUPTCY CODE, 2016

During the year under review, the Company has neither made any application nor any proceeding is pending under the Insolvency and Bankruptcy Code, 2016.

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

There was no instance of one-time settlement with any Bank or Financial Institution, during the year under review.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

In compliance with the provisions of the Companies Act, 2013 and SEBI Listing Regulations, all related party transactions are placed before the Audit Committee for prior approval and also before the Board wherever necessary. Prior omnibus approval from Audit Committee is obtained for the related party transactions which are repetitive in nature. The details of all transactions executed with related parties are placed before the Audit Committee on a quarterly basis for its review.

During the year under review, all contracts/arrangements/transactions entered into by the Company with related parties were in the ordinary course of business and were on an arms length basis and in accordance with the provisions of the Companies Act, 2013 and the rules made thereunder, the SEBI Listing Regulations and Companys Policy on Related Party Transactions. None of the transactions with any of the related parties were in conflict with your companys interest.

All related parties transactions are disclosed in Note No. 37 of the Financial Statements forming part of this Annual Report. The Related Party Transaction Policy of the Company is available on the website of the Company at https://pasupatiacrylon.com/wp-content/uploads/2025/02/ Policy-on-Related-Party-Transactions.pdf.

Pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of contracts or arrangements or transactions entered during the finance year 2024-25 with related parties referred to Section 188(1) of the Companies Act, 2013 in the prescribed form AOC-2 is appended as Annexure-I to the Boards Report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY BETWEEN THE DATE OF Boards REPORT And End OF FINANCIAL YEAR

There is no such material change and commitment affecting the financial position of the Company which have occurred between the end of financial year of the Company to which the financial statements relate and the date of this report.

DISCLOSURE UNDER SEXUAL HARRASSMENT OF WOMEN AT WORK PLACE

The Company has in place a Policy for prevention of sexual harassment at the workplace in line with the requirements of Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee had been set up to redress complaints regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. No complaints on issues covered by the above act were received during the year. However, during the year under review, there was no female employee in the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS/TRIBUNALS

During the year under review, there are no significant or material orders passed by the Regulators / Courts/Tribunals which would impact the going concern status of the Company and its future operations.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

In accordance with the provisions of Section 135 of the Companies Act, 2013, the Board of Directors has constituted the Corporate Social Responsibility Committee (CSR Committee).The said Committee has been entrusted with the responsibility of recommending to the Board about the activities to be undertaken by the Company for CSR purpose, monitoring the implementation of the frame work of the CSR Policy and recommending the amount to be spent on CSR Activities. The CSR policy is available on the Companys website www.pasupatiacrylon.com .

The Companys total CSR obligation for the financial year 2024-25 was Rs. 85.79 Lakh. However, an amount of Rs. 46,000/-, which was excess spent in Financial Year 2023-24, was also available for set-off against the Companys CSR obligations for the financial year 2024-25 in terms of 3rd Proviso to Section 135(5) of the Companies Act, 2013 read with Rule 7(3) of the Companies (Corporate Social Responsibility Policy) Rules, 2014, but Board decided not to set-off the said excess amount.

In view of the above, the Company has spent Rs. 86.00 Lakh towards the CSR activities during the financial year 2024-25 and hence, the Companys CSR obligation for FY 2024-25 has been duly met in compliance with Section 135(5) of the Companies Act, 2013.

Further, in terms of the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Chief Financial Officer has certified that the funds disbursed for CSR have been used for financial year 2024-25, for the purpose and in the manner approved by the Board.

The disclosures related to CSR activities pursuant to section 134(3) of the Companies Act 2013, read with Rule 9 of Companies (Accounts) Rules, 2014 and Rule 8 of Companies (Corporate Social Responsibility) Rules 2014 are annexed hereto and form part of this report as Annexure- II.

RISK MANAGEMENT

The Company takes calculated business risks in a prudent manner to achieve its corporate objectives and implement its strategy. The Company follows Risk Management System that ensures timely risk identification, evaluation and analysis of mitigation plans, as well as the identification of improvement areas to minimise any negative impact on our operations. The Board of Directors has constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board to oversee and approve the Companies Risk Management framework and all the risks that the company faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management.

Risk Management Policy enables the Company to proactively manage uncertainties and changes in the internal and external environment to limit negative impacts and capitalize on opportunities. The Company has laid down a Risk Management Policy which was reviewed by the Risk Management Committee and approved by the Board. The Risk Management Policy has also been hosted on the website of the Company www.pasupatiacrylon.com .

AUDITORS AND AUDITORS REPORT Statutory Auditors

M/s B.K. Shroff & Co., Chartered Accountants (ICAI Firm Registration No. 302166E) were appointed as Statutory Auditors of the Company at the 39th AGM of the Company held on 29th September, 2022 for a period of 5 (Five) years commencing from the conclusion of 39th AGM till the conclusion of the 44th AGM. The Auditors have confirmed that they continue to fulfill the eligibility criteria for holding the office as Statutory Auditor of the Company as prescribed under the Companies Act 2013 and the Rules framed there under.

The notes on financial statement referred to in the Auditors Report are self-explanatory and do not call for any further comments. During the year under review, the Statutory Auditors has not found any instance of fraud committed against the Company by its officers or employees and accordingly, reporting to the audit committee or Central Government, under Section 143 (12) of the Companies Act, 2013 is not required. The Auditors report does not contain any qualification, reservation or adverse remark or disclaimer.

Cost Auditor

Pursuant to Section 148(1) and other applicable provisions of the Companies Act, 2013 and the Companies (Cost Records and Audit) Rules, 2014, maintenance of cost records is required by the Company and accordingly, such accounts and records are made and maintained.

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, Board of Directors, on the recommendation of the Audit committee has appointed Mr. Satnam Singh Saggu, Cost Accountants (Membership No. 10555) as Cost Auditors of your company for the Financial Year 2025-26 to carry out the cost audit for the applicable business on a remuneration of Rs. 50,000/- (Rupees fifty thousand only) plus applicable taxes and reimbursement of out of pocket expenses. A certificate from Mr. Satnam Sigh Saggu, Cost Accountants has been received to the effect that their appointment as Cost Auditors of the Company, if made, would be in accordance with the limits specified under Section 141 of the Companies Act, 2013 and Rules made thereunder. Accordingly, the matter relating to ratification of the remuneration payable to the Cost Auditors for the financial year ending 31st March, 2026 is being placed at the 42nd AGM.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company, at its meeting held on 17th May, 2024, had appointed M/s. Mehak Gupta & Associates, Practicing Company Secretary (CP No. 15013, Membership No. 10703), to undertake Secretarial Audit for the financial year 2024-25. The Secretarial Audit Report for the Financial Year ended 31st March, 2025 is annexed herewith to this Report as Annexure - III. The Secretarial Audit Report is self- explanatory and do not call for any further comments. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer.

In terms of Regulation 24A of SEBI Listing Regulations as amended read with SEBI Circular No. SEBI/HO/CFD/CFD-PoD-2/CIR/P/2024/185 dated 31st December 2024, Board of Directors of the Company has recommended the appointment of M/s. Mehak Gupta & Associates, Practicing Company Secretary (CP No. 15013, Membership No. 10703) and Peer review No. 1643/2022) as the Secretarial Auditors of the Company to conduct the secretarial audit for a period of 5 (Five) consecutive years from the financial year 1st April, 2025 to 31st March, 2030, subject to approval of the shareholders of the Company. The resolution in this regard is being proposed at ensuing AGM for approval of the shareholders.

The Company has received consent, eligibility letter and Peer Review Certificate from M/s. Mehak Gupta & Associates confirming that their appointment, would be under the provisions of Section 204 of the Companies Act, 2013 and that they are not disqualified to be appointed as Secretarial auditor in terms of the provisions of Regulation 24A of the SEBI Listing Regulations.

Internal Auditor

Pursuant to provisions of Section 138 of the Companies Act, 2013 M/s. Jinender Jain & Company, Chartered Accountants, New Delhi, Internal Auditors of the Company have conducted internal audit of the functions and activities of the Company and effectiveness of Internal Control Systems of the Company during the financial year 2024-25.

Internal Financial Control

Your Company remains committed to improve the effectiveness of internal financial controls and processes which would help in efficient conduct of its business operations, ensure security to its assets and timely preparation of reliable financial information. The Company has a proper system of internal control to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and transactions are authorized, recorded and reported correctly.

In the opinion of the Board of Directors, the internal financial controls with reference to the Financial Statements are adequate commensurate with the size, scale and complexity of operations of the Company.

The Board of Directors has adopted policies and procedures for ensuring the orderly and efficient conduct of business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, ensuring accuracy and completeness of the accounting records and timely preparation of reliable financial information.

The Audit Committee of the Board actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Statutory Auditors and the Internal Auditors are inter alia, invited to attend the Audit Committee Meetings and present their observations on adequacy of internal financial controls and the steps required to bridge gaps, if any.

DISCLOSURES:

Audit Committee

Audit Committee of the Board has been constituted as per the SEBI Listing Regulations and Section 177 of the Companies Act, 2013. The composition and other details of the Audit Committee are provided in Corporate Governance Report which is part of this Report. All recommendations made by the Audit Committee were accepted by the Board.

Vigil Mechanism

The Company promotes ethical behaviour in all its business activities and is in line with the best governance practices. The Company has framed and implemented a vigil mechanism named as Whistle Blower Policy to deal with instances of fraud and mismanagement, if any, in terms of Section 177(9) of the Companies Act, 2013 and Regulation 22 of SEBI Listing Regulations. The details of the Whistle Blower Policy are provided in the Corporate Governance Report and also posted on the website of the Company www.pasupatiacrylon.com .

Cyber Security

In view of the increased cyberattack scenarios, the cyber security maturity is reviewed periodically and the processes, technology controls are being enhanced in-line with the threat scenarios.

Particulars of Loans , Investments, Guarantees.

During the year under review, the Company has not given any loan or provided any security or guarantee in terms of Section 186 of the Companies Act, 2013. The Company has complied with the provisions of Section 186 of the Companies Act, 2013. Particulars of Loans given/ Investments made/Guarantees given/Securities provided as per Section 186 of the Companies Act, 2013, is disclosed in financial statements.

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

The information as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014 is set out in the Annexure - IV to this Report.

Annual Return

Pursuant to the amendments to the provisions of Section 92(3) read with Section 134 (3) (a) of Companies Act, the annual return as on 31st March, 2025 is available on the website of the Company at www.pasupatiacrylon.com under Investor Section.

Particulars of Employees

The statement containing particulars of employees 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 as amended, is attached as Annexure - V.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, in terms of first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the shareholders of the Company. The said annexure is open for inspection at the Registered Office of the Company during business hours on all working days, 21 days before the AGM. Any shareholder interested in obtaining such information may write to the Company Secretary at email id - secretarial@pasupatiacrylon.com and the same will be furnished on request.

ISO CERTIFICATION

Your Company is an ISO 9001:2015, accredited by Bureau of Indian Standard, Rooid Voor Accreditatie, and Netherland and OKEO TEX STANDARD 100 Class 1 Appendix 6. Furthermore, the Companys CPP Product meets the requirements set out in the BRC Global Standard for Packaging & Packaging Material and is categorized as HIGH HYGINE Grade A by the BRCGS. These certifications/recognitions are indicative of your companys commitments in meeting global quality standards and thrust excellence for achieving customer satisfaction:

ACKNOWLEDGEMENT

Your Directors wish to place on record their deep appreciation of the continued support and co-operation received from Financial Institutions, Banks and Shareholders, the State and Central Government.

Your Directors also wish to place on record their appreciation of the devoted services of the Companys employees, who have diligently contributed to the Companys progress.

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto.

1. Details of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 which are not at arms length basis. - NIL

2. Contracts/arrangements/transactions entered into by the company with related parties referred to in sub- section (1) of section 188 of the Companies Act, 2013 which are at arms length basis:

S. No. Name(s) of the related party and nature of relationship

Nature of contracts/ arrangements/ transactions Duration of the contracts / arrangements / transactions Salient terms of the contracts or arrangements or transactions including the value, if any Date(s) of approval by the Board, if any Amount paid as advances, if any Justification for entering into contracts

1. Vigar Enterprises Private Limited (Common Director)

Purchase of organic grocery products for official use Perpetual

Agreement

Purchase of organic grocery products at arms length basis, with a maximum limit of Rs.12 Lakh per annun. 10th August, 2019 Nil The related party is engaged in dealing of organic grocery products and the Company requires the grocery products for its official use from time to time. Hence, the Company had entered into an agreement with the related party to purchase the grocery products for its official use.

2. Prabhat Capital Services Limited (Promoter Group Company)

Payment of lease rent 3 Years w.e.f 1st April, 2024 Payment of lease rent @ Rs. 15,400/- per month plus Rs. 15,400/- per month towards maintenance charges Since long Nil The Company required a office at Ludhiana for marketing and sale of its products. Accordingly, the Company took office from related party on lease for its official use.

3. Vigar Enterprises Private Limited (Common Director)

Payment of lease rent For a period of 29 years 11 months w.e.f 16th May, 2022 The Company has taken the land (2.87 Acre) on lease basis from the related party at a price of Rs. 5,000/- per acre per month for its Ethanol Plant. 18th May, 2022 and

10th August, 2023

Nil The Company required additional land to setup its Ethanol Plant adjoining to its existing manufacturing unit at Thakurdwara. As the related party owns land in that area, the Company has taken their land on lease basis for its Ethanol Plant. Accordingly, the transaction is in the interest of the Company.

 

4. Sulabh Plantations & Finance Pvt. Ltd. (Promoter Group Company and shareholding by relative of director)

Payment of Lease Agreement For a period of 29 years 11 months w.e.f 16th May, 2022 The Company has taken the land (12.45 Acre) on lease basis from the related party at a price of Rs. 5,000/- per acre per month for its Ethanol Plant. 18th May, 2022 and

10th August, 2023

Nil The Company required additional land to setup its Ethanol Plant adjoining to its existing manufacturing unit - in Thakurdwara. As the related party owns land in that area, the Company has taken their land on lease basis for its Ethanol

Plant. Accordingly, the transaction is in the interest of the Company.

5. Pasupati Advanced Films Pvt. Ltd. (Common Director)

Payment of Lease

Agreement

For a period of 29 years 11 months w.e.f

16th May, 2022

The Company has taken the land (4.68 Acre) on lease basis from the related party at a price of Rs. 5,000/- per acre per month for its Ethanol Plant. 18th May, 2022 and

10th August, 2023

Nil The Company required additional land to setup its Ethanol Plant

adjoining to its existing manufacturing unit

at Thakurdwara. As

the related party owns land in that area, the Company has taken their land on lease basis for its Ethanol Plant. Accordingly, the transaction is in the interest of the Company.

Annual Report on Corporate Social Responsibility (CSR) Activities for the Financial Year 2024-25

[Pursuant to Section 135 of the Companies Act, 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014]

1. Brief Outline On CSR Policy Of The Company:

The Company has framed its CSR Policy to carry out its CSR activities in accordance with Schedule VII of the Companies Act, 2013. The Company strives to positively impact the community by promoting inclusive growth in the areas of education, art, healthcare, sports, environmental sustainability and conservation etc. The Companys focus areas are concentrated on increasing access to health, education, rural development, environment sustainability, community development and holistic development with a focus on underprivileged people living around its manufacturing units and other establishments. The Companys CSR Policy also focuses on leveraging the full range of the Companys resources to broaden access to the basic facilities for the underserved population. The Company also partners with non-government organizations (NGOs) to make a difference among local communities. The Companys focus has always been to contribute to the sustainable development of the society and environment and to make our planet a better place for future generations. This Policy shall apply to all CSR initiatives and activities taken up by the Company for the benefit of different sections of the society. The Companys CSR policy is placed on its website www.pasupatiacrylon.com .

2. Composition Of CSR Committee:

S. 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 Mr. S.C. Malik

Chairman (Independent Director) 4 4

2 Mr. Vineet Jain

Member (Executive Managing Director) 4 4

3 Mr. Satya Prakash Gupta

Member (Whole-time Director) 4 4

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.

i. Composition of CSR Committee: https://pasupatiacrylon.com/investors/#CompositionofvariouscommitteesofBoardofDirectors

ii. CSR Policy: https://pasupatiacrylon.com/wp-content/uploads/2023/04/Corporate-Social-Responsibility-CSR-Policy.pdf

iii. CSR Projects approved by the Board: https://pasupatiacrylon.com/wp-content/uploads/2025/05/CSR-ANNUAL-ACTION- PLAN_FY2025-26.pdf

4. Provide the executive summary along with web-link(s) 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 - Not Applicable

5. (a) Average net profit of the company as per section 135(5) - Rs. 4,289.27 Lakh

(b) Two percent of average net profit of the company as per section 135(5) - Rs. 85.79 Lakh

(c) Surplus arising out of the CSR projects or programmes or activities of the previous financial years. - Nil

(d) Amount required to be set off for the financial year, if any - Nil

(e) Total CSR obligation for the financial year [(b)+(c)-(d)]. - Rs. 85.79 Lakh

6. (a) Amount spent on CSR Projects (both Ongoing Project and other than Ongoing Project) - Rs. 86.00 Lakh

(b) Amount spent in administrative overheads - Nil

(c) Amount spent on Impact Assessment, if applicable - Not Applicable

(d) Total amount spent for the Financial Year [(a)+(b)+(c)] - Rs. 86.00 Lakh

(e) CSR amount spent or unspent for the Financial Year:

Total Amount Spent for the Financial Year. (in Rs.)

Amount Unspent (in Rs.)

Total Amount transferred to Unspent CSR Account as per Section 135 (6)

Amount transferred to any fund specified under Schedule VII as per second proviso to Section 135 (5)

Amount date of transfer Name of the Fund Amount date of transfer

Rs. 86.00 Lakh

Not Applicable

(f) Excess amount for set off, if any:

Sl. No. (1) Particular (2)

Amount (Rs. In Lakh)

(3)

(i) Two percent of average net profit of the company as per section 135(5)

85.79

(ii) Total amount spent for the Financial Year

86.00

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

0.21

(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)]

0.21

7. Details of Unspent Corporate Social Responsibility amount for the preceding three financial years:

(1) (2)

(3) (4) (5)

(6)

(7) (8)

Sl. No. Preceding Financial Year

Amount transferred to Unspent CSR Account under Section 135(6) (in Rs.)

Balance Amount in Unspent CSR Account under Section 135(6) (in Rs.)

Amount spent in the Financial Year (in Rs.)

Amount transferred to a fund specified under Schedule VII as per second proviso to Section 135(5), if any.

Amount remaining to be spent in succeeding financial years.

(in Rs).

deficiency, if any

Amount (in Rs). date of transfer

NIL

8. Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year: Nil

9. Specify the reason(s), if the company has failed to spend two per cent of the average net profit as per sub-section (5) of section 135

: Not Applicable

ANNEAURE - III

Form No. MR-3

SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR Ended 31st MARCH, 2025

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

To,

The Members,

PASUPATI ACRYLON LIMITED CIN: L50102UP1982PLC015532 Thakurdwara, Kashipur Road,

Distt. Moradabad, Uttar Pradesh-244601, India

I, Mehak Gupta, Proprietor of Mehak Gupta & Associates, Company Secretaries, have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Pasupati Acrylon Limited (CIN- L50102UP1982PLC015532) (hereinafter called the “Company”). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on my 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, I hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on 31st March, 2025, complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

I have examined the books, papers, minutes books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2025 according to the provisions of:

(i) The Companies Act, 2013 (as amended) (‘the Acf) and the rules made there under;

(ii) Secretarial Standard-1 (“SS-1”) and Secretarial Standard-2 (“SS-2”) issued by the Institute of Company Secretaries of India;

(iii) Listing agreement entered into by the Company with the BSE Limited and National Stock Exchange of India Limited;

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

(v) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(vi) 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;

(vii) 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 (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (as amended);

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (as amended);

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 (as amended);-

(Not applicable to the Company during the audit period).

(d) The Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021; - (Not applicable to the Company during the audit period).

(e) The Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021; - (Not applicable to the Company during the audit period).

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;.

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021; - (Not applicable to the Company during the audit period) and

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018; - (Not applicable to the Company during the audit period).

(i) The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015 (“SEBI (LODR) Regulations, 2015”);

(j) The Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018.

(viii) I further report that, having regards to the compliance system prevailing in the Company and on examination of the relevant documents and records in pursuance thereof, on test check basis, the Company has complied with the provisions of Labour Laws, Environmental Laws and other related Industry specific laws to the extent applicable to the Company.

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

I 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. During the period under review, change in the composition of the Board of Directors were made in due compliance of the Act and SEBI (LODR) Regulations, 2015.

Adequate notice has been given to all Directors to schedule the Board Meetings/Committee Meetings during the financial year under review, agenda and detailed notes on agenda were sent generally at least seven days in advance to all the Directors and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. On inspection of the minutes as captured and recorded it was ascertained that all the decisions of the Board and Committees Meetings were unanimous and there were no dissenting views.

I further report that, based on the review of the compliance reports and the certificates of the Company Executive and taken on record by the Board of Directors of the Company, in my opinion there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines. The Company is generally regular in filing of e-forms with the Registrar of Companies within the time prescribed under the Act.

I further report that during the audit period, there was specific event/action having a major bearing on Companys affairs in pursuance of the above referred laws, rules, regulations, guidelines, standards, etc as mentioned below.

The Company has commenced commercial production at its newly set-up 150 KL per day grain-based Ethanol Plant situated at Thakurdwara, District Moradabad, Uttar Pradesh

I further have to state that:

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

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

3. I have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company.

4. Where-ever required, I 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. My examination was limited to the verification of procedure on test check basis.

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

ANNEXURE- IV

INFORMATION ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO PURSUANT TO SECTION 134(3)(m) OF THE COMPANIES ACT, 2013 Read WITH RULE 8(3) OF COMPANIES (ACCOUNTS) RULES, 2014 FOR THE YEAR ENDED 31st MARCH, 2025

(A) CONSERVATION OF ENERGY

1. Energy conservation measures taken during the year are as under:

• Upgradation of 02 Nos. Air Washer Fans by hi energy efficient fans which have resulted in Energy Saving.

• In Tow Dyeing Area steam which was being drained has been recovered.

• Replacement of Cooling Tower Fans with energy efficient fans.

• Optimization parameters of Fibre Line Drum Dryer have been done which has resulted in reduction of steam consumption.

• Solar Power System of 750 KW has been installed.

2. Additional investments and proposals:

The company is continuously exploring various avenues to reduce and optimize energy cost.

3. Impact of the measures at (1) and (2) above would save energy consequently favourably impacted the cost of production:

(B) TECHNOLOGY ABSORPTION, ADAPTATION & INNOVATION:

1. Efforts, in brief, made towards technology absorption, adaptation and innovation

Development of Fibre for hair application Development of MOD Acrylic (Fire Retardant Fibre)

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

Additional Market Additional Profit Margin.

3. Particulars of imported technology in the last five years:

i) Technology imported

: N.A

ii) Year of import

: N.A

iii) Has technology been fully absorbed

: N.A

If not fully absorbed, reason for & future action plan

: N.A

4. Expenditure on R&D.

S.No. Particulars

2024-25 2023-24

i) Capital

- -

ii) Recurring

76.16 72.38

iii) TOTAL

76.16 72.38

iv) Total R&D expenditure as a percentage of total turnover

0.12% 0.12%

(C) FOREIGN EXCHANGE EARNINGS & OUTGO

1. Activities relating to exports, initiatives taken to increase exports, development of new export market for products and services and export plan.

2. Total Foreign Exchange Used & Earned (Rs. in Lakh)

Foreign Exchange Utilised

2024-2025 2023-2024

i) Travelling

17.66 12.69

ii) Interest & other charges

27.25 33.91

iii) Commission on export sales

110.82 10.05

iv) CIF Value of Imports :

- Raw Material

32,132.76 30,627.24

- Stores and spares

40.55 20.96

- Capital Expenditure

- -

Foreign Exchange Earned

FOB Value of Exports (excluding Rs. Nil) export in INR - (Previous year Rs. Nil Lakh)

5,341.39 4,513.52

PARTICULARS OF REMUNERATION OF DIRECTORS /KMPs/EMPLOYEES

a) 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 are given below:

Sr. No. Name of director/ Key Managerial Personnel (“KMP”)

designation Ratio of Remuneration of each director / KMP to the Median Remuneration of Employees Percentage increase in Remuneration of director/ KMP for Financial Year 2024-25

1 Mr. Vineet Jain

Managing Director 80.01 107.00

2 Mr. Satya Prakash Gupta

Director (Operations) 11.90 4.01

3 Mr. S.C. Malik

Independent Director Not Applicable, as only sitting fees was paid during the financial year 2024-25

-

4 Mr. D. K. Kapila

Independent Director Not Applicable, as only sitting fees was paid during the financial year

2024-25

-

5 Mrs. Kamlesh Gupta

Independent Director Not Applicable, as only sitting fees was paid during the financial year

2024-25

-

6 1Mr. S. Sathyamoorthy

Independent Director Not Applicable, as only sitting fees was paid during the financial year

2024-25

-

7 2Mr. Raj Ganesh Viswanathan

Independent Director Not Applicable, as only sitting fees was paid during the financial year

2024-25

-

8 Mr. Satish Kumar Bansal

Chief Financial Officer 8.02 4.92

9 Mr. Bharat Kapoor

Company Secretary 3.42 9.05

Note: Independent Directors do not draw any remuneration/commission other than sitting fees.

‘Mr. S. Sathyamoorthy ceased to be director of the company due to completion of his second term as an Independent Director on 26th September, 2024.

2Mr. Raj Ganesh Viswanathan has been appointed as an Independent Director of the Company w.e.f 23rd August, 2024

b) The percentage increase in the Median Remuneration of Employees in the Financial Year 2024- 25: was -14.76 %.

c) The number of permanent employees on the rolls of the Company was 514 as on 31st March, 2025.

d) Average percentage increase already made in the salaries of employees other than the managerial personnel in the last Financial Year was about 6.75%. The increase in remuneration is determined based on the grade designation of the employee of the Company.

e) It is hereby affirmed that the remuneration is as per the remuneration policy of the company.

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IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248, DP SEBI Reg. No. IN-DP-185-2016, BSE Enlistment Number (RA): 5016
ARN NO : 47791 (AMFI Registered Mutual Fund Distributor)

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We are ISO 27001:2013 Certified.

This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.