Pasupati Spinning & Weaving Mills Ltd Directors Report

During FY 2024-25, the companys turnover declined to Rs. 100.50 Crore from Rs. 107.93 Crore achieved during FY 2023-24. The turnover declined as the company was forced to suspend spinning operations of its spinning unit at Dharuhera due to adverse marketing conditions as the operations became unviable. Had the operation of the said unit continued, the same would have adversely affected the bottom line of the company. The textile sector in general is passing through bad phase for last more than two years. Therefore, the results of the company have also been affected adversely due to overall market scenario but impact on your company is relatively less severe as the company is in value added segment.

II THE MANAGEMENT DISCUSSION & ANALYSIS

Spinning Unit, Dharuhera

As informed last year, the company has discontinued operations of this unit due to adverse market conditions.

Knitting, Garment, Dying & Processing unit, Dharuhera

After COVID 19, the market conditions continue to be grim both on domestic and export front and the company is struggling to procure orders for readymade garments. However, during FY 2024-25, the turnover of this unit has increased to Rs. 395.86 Lacs as compared to Rs. 270.34 Lacs achieved during FY 2023-24. This has been possible as the company procured orders from Vishal Mega Mart. However, the market scenario of readymade garment continues to be sluggish.

Sewing Thread Unit at Kala Amb, Himachal Pradesh

This unit contributes around 90-95% of companys total revenue but the operations for this unit have also been impacted adversely due to overall slugging market conditions prevailing in textile sector. In spite of the adverse market conditions, the unit continues to make profit. If market scenario improves, the operations of this unit will also improve. However, shortage of labour continues to be cause of concern for the management. In order to overcome this problem, the company has prepared a Modernization Plan, whereby some of the machines are proposed to be replace by fully automatic state-of-the art machines, which will reduce the dependence on labour force to a great extent. Further during the year under consideration, State Electricity Board increased the tariff. In order to off set the impact of increased power cost, the company has installed a Solar Generating Plant, which was fully commissioned in February 2025. The Solar plant is working satisfactorily. The company expects yearly saving of around Rs. 300 Lacs in power cost. With the installation of new machines under

Modernization Scheme and working of Solar Plant, the results of this unit are expected to improve significantly in coming years.

Logistic and Warehousing

As inform in last report, the company had amended its Memorandum of Association and included ‘Logistic and Warehousing as a new business segment The company is having surplus land and building at its Dharuhera unit. Major portion of surplus building has been developed as Warehouse and more area is being developed. During the year under consideration, the company has generated a revenue of Rs, 327.54 Lacs as against Rs. 155.52 lacs during FY 2023-24. The management is hopeful that this segment shall start contributing to the bottom line significantly in following year.

III PARTICULARS OF INFORMATION FORMING PART OF THE BOARDS REPORT PURSUANT TO SECTION 134 OF THE COMPANIES ACT, 2013, RULE 8 OF THE COMPANIES (ACCOUNTS RULE 2014 AND RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

ANNUAL RETURN

The annual return of the company has been placed on the website of the company and can be accessed at www.pasupatitextiles.com

NUMBER OF MEETING OF BOARD

During the year, four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held. The details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013

GENERAL MEETING

The Company had 01 General meeting during the financial year under review.

DIRECTORS RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed. ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the Company for the year under review. iii) The directors have 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. iv) The directors have prepared the annual accounts on a going concern basis. v) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

The directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively

STATEMENT ON DECLARATION BY THE INDEPENDENT DIRECTORS.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Listing regulations, 2015.

NOMINATION & REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a Policy for selection, appointment and remuneration of Directors and Key Managerial Personnel. More details of the same are given in the Corporate Governance Report.

EXPLANATION OR COMMENTS ON AUDITORS REPORT AND SECRETARIAL AUDIT REPORT

Auditors observations relating to Note no. 39 as contained in the Main Report under the para ‘Basis of Qualified Opinion are explained hereunder: -

Note 39: Although, the company has made representation to the competent authority for payment of compensation at market rate in respect of part of companys factory land acquired by Government of Haryana, the company feels that final decision in this regard may take a very long time and moreover there is uncertainty about the success of companys representation. Hence, it has been decided that its affect would be given in companys books as and when actual compensation is received from Government of Haryana.

There is no qualification, reservations or adverse remarks made by secretarial auditor in the Secretarial Audit Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the year under review, company has not given any loans, Guarantee or made any investments covered under the provisions of Section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

Pursuant to Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contracts or arrangements entered into by the Company with Related Parties have been done at arms length and are in the ordinary course of business. Particulars of the same are being provided in Form AOC-2 which is annexed herewith as Annexure D.

The Company formulated a policy on Related Party Transactions (RPTs) in accordance with the Act including any amendments thereto for identifying, reviewing approving and monitoring of RPTs. The said policy is available on the Companys website at www.pasupatitextiles.com

STATE OF COMPANYS AFFAIRS

Discussion on state of Companys affairs has been covered as part of the Management Discussion and Analysis.

AMOUNTS PROPOSED TO BE CARRIED TO RESERVES

Board of Directors does not appropriate any amount to be transferred to General Reserves during the year under review.

DIVIDEND

In view of the requirement of fund for working capital of the company, the Board of Directors is not in a position to recommend any dividend for the year under review.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid last year.

MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANY

No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year of the Company and the date of signing of this Report.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure “B”.

RISK MANAGEMENT POLICY

Pursuant to the requirement of SEBI (LODR) Regulations, 2015, the Company has constituted a Risk Management Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Boards Report. On the recommendation of the Risk Management Committee, the Board has adopted Risk Management Policy, which outlines the program implemented by the Company to ensure appropriate risk management within its system and culture. The Risk Management Policy is also posted on the website of the Company. The Companys risk management program comprises of a series of processes, structures and guidelines which assist the Company to identify, assess, monitor and manage its business risks, including any material changes to its risk profile. To achieve this, the Company has clearly defined the responsibility and authority of the Companys Board of Directors and of the Risk Management Committee to oversee and manage the risk management program while conferring responsibility and authority on the Companys senior management to develop and maintain the risk management program in light of the day to day needs of the Company. Regular communication and review of risk management practices provide the Company with important checks and balances to ensure the efficacy of its risk management program.

CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

The relevant provisions of the Companies Act, 2013 and Listing regulations are not applicable to our company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, and Regulation 17 of the SEBI (LODR) Regulations, 2015 the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The boards performance for the current year was assessed on the basis of participation of directors, quality of information provided/available, quality of discussion and contribution etc. The overall performance of the Board and Committees of the Board was found satisfactory. The overall performance of Chairman, Executive Directors and the Non-executive Directors of the Company is satisfactory. The review of performance was based on the criteria of performance, knowledge, analysis, quality of decision making etc.

CHANGE IN THE NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

a. Composition of Board of Directors:

The Composition of Board of Directors as on 31^st March, 2025 is as follows:

b. Key Managerial Personnel

The following persons are the Key Managerial Personnel of Company as on 31st March, 2025:

c.Change in Director and KMP, during the year under review:

During the financial year, following changes have been occurred:

d. Subsequent to year end, the following changes took place in the composition of the Board of Directors:

After the closure of financial year, there has been no change in the directorship of the Company. However, there has been changes in Key Managerial Personnel as mentioned herein below:

After the closure of financial year, Mr. Ajay Kumar Monga, CFO retired from the Companys employment w.e.f closing of the working hours of 31/03/2025. And later on Mr. Ajay Kumar Monga was again re-appointed as CFO (Key Managerial Personnel) w.e.f 23/05/2025.

e.Retirement by Rotation of the Directors

Mr. Chander Mohan Sharma (DIN: 08047336) retires by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting. And Mr. Vidit Jain (DIN: 01347588) retired by rotation at the annual general meeting held on 30/09/2024 and was re-appointed.

f. Independent Directors

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) and 25 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.

Further, in terms of Rule 8(5) (iiia) of the Companies (Accounts) Rules, 2014, as amended, the Board of Directors state that in the opinion of the Board, during the Financial Year 2024-25 all the Directors whose appointments as Independent Directors of the Company have been approved by the Shareholders during the year, are persons of integrity and possess relevant expertise and experience. Further, the Independent Directors have been exempted/successfully qualifying the online proficiency self-assessment test conducted by the Indian Institute of Corporate Affairs.

NAMES OF THE COMPANIES WHICH HAVE BECOME/ CEASED TO BE SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

The Company did not have any subsidiaries, associates or joint ventures during the year.

DEPOSITS

The company has not invited/accepted any deposits from the members as well as public during the year ended March 31, 2025. There were no unclaimed or unpaid deposits as on March 31, 2025.

SIGNIFICANT ORDERS PASSED BY REGULATORS, COURTS OR TRIBUNALS IMPACTING GOING CONCERN AND COMPANYS OPERATIONS

To the best of our knowledge, the Company has not received any such orders from Regulators, Courts or Tribunals during the year, which may impact the going concern status or the Companys operations in future.

SHARE CAPITAL OF THE COMPANY

As on 31st March, 2025, the Share Capital Structure of the Company was as follows:

Authorized Share Capital: INR 12,10,00,000/- (Indian Rupees Twelve Crore Ten Lakhs Only) divided into 1,21,00,000 shares of INR 10/- each

Issued and Subscribed Share Capital: INR 9,33,70,680/- (Indian Rupees Nine Crore Thirty Three Lakh Seventy Thousand Six Hundred Eighty Only) divided into 93,37,068 shares of INR 10/- each.

During the year the following changes has occurred: i. Increase in Authorized Share Capital of The Company : NIL ii. Issue of Shares or Other Convertible Securities : NIL

iii.Issue of equity shares with differential rights:

The Company has not issued any equity shares with differential rights during the year under review.

iv. Issue of sweat equity shares:

The Company has not issued any sweat equity shares during the year under review.

v. Details of employee stock options:

The Company has not issued any Employee Stock Options during the year under review.

vi. Shares held in Trust for the benefit of employees where the voting rights are not exercised directly by the employees:

The Company does not held any shares in trust for the benefit of employees where the voting rights are not exercised directly by the employees during the year under review.

vii. Issue of Debentures, Bonds or Any Non-Convertible Securities

The Company has not issued any debentures, bonds or any non-convertible securities during the year under review.

viii. Issue of Warrants

The Company has not issued any warrants during the year under review.

INTERNAL CONTROL SYSTEMS

Your Company has evolved a system of internal controls to ensure that the assets are safeguarded and transactions are authorised, recorded and correctly reported. The internal control system is supplemented by management reviews and independent periodical reviews which evaluate the functioning and quality of internal controls and provides assurance of its adequacy and effectiveness. The scope of internal audit covers a wide variety of operational methods and, as a minimum, ensures compliance with specified standards with regard to availability and suitability of policies and procedures, extent of adherence, reliability of management information system and authorization procedures including steps for safeguarding of assets. The reports of internal audit are placed before Audit Committee of the Directors and Board. Audit Committee and board reviews such audit findings and the adequacy of internal control systems. The Statutory Auditors and the Internal Auditors of the Company also interact with the Audit Committee and Board to share their findings and the status of corrective actions under implementation.

INFORMATION FORMING PART OF THE DIRECTORS REPORT PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES, 2014

The provisions of Rule 5(2) & (3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 requiring particulars of the employees in receipt of remuneration in excess of Rs. 1 Crore and 2 Lacs per year to be disclosed in the Report of Board of Directors are not applicable to the Company as none of the employees was in receipt of remuneration in excess of Rupees One Crore and two Lacs during the financial year 2024-25. The information in accordance with the provisions of Section 197 of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as Annexure-C.

A statement comprising the names of top 10 employees in terms of remuneration drawn and every person employed throughout the year, who were in receipt of remuneration in terms of Rule 5(2) of the Companies.

(Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms an integral part of this report)

However, the same is not being sent along with this Annual Report to the Members of your Company in line with the provision of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars may write to cs@pasupatitextiles.com and these documents will be made available for inspection electronically from the date of circulation of this Annual Report up to the date of AGM.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors has adopted the Vigil Mechanism / Whistle Blower Policy. The policy has provided a mechanism for Directors, Employees and other persons dealing with the Company to report to the Chairman of the Audit Committee, any instance of unethical behavior, actual or suspected fraud or violation of the Code of Conduct of the Company. The details of the policy has been uploaded at the website of the Company @ www.pasupatitextiles.com

COMMITTEES OF BOARD

The Board of Directors in line with the requirement of the act has formed various committees, the detailed terms of reference and composition of the various Committees has been mentioned in the Corporate Governance Report annexed to this report.

AUDITORS

STATUTORY AUDITORS

M/s. B K Shroff & Co. Chartered Accountants, can continue as Statutory Auditors till the conclusion of the Forty Seventh Annual General Meeting to be held in the year 2027.

INTERNAL AUDITOR

The Board had appointed M/s Suresh Kumar Mittal & Company, Chartered Accountants as the Internal Auditor of the Company for the financial year 2024-25 to 2025-26.

COST AUDITORS

The Central Govt. has approved the appointment of Mr. Satnam Singh Saggu, Cost Accountants as cost auditors for conducting Cost Audit for the Financial Year 2025-26. The report of Cost Auditors in respect of audit of the cost records of the Company for the year ended 31^stMarch 2025 will be submitted to the Central Government in due course.

SECRETARIAL AUDITORS

The Company has undertaken Secretarial Audit for the financial year 2024-25 which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made under the Act, Listing Regulations and applicable Regulations prescribed by the Securities and Exchange Board of India and Foreign Exchange Management Act, 1999 and Secretarial Standards issued by the Institute of the Company Secretaries of India. The Secretarial Audit Report forms part of this Annual Report. The Report of the Secretarial Audit as submitted by Sumit Bajaj & Associates is annexed herewith as

Annexure-A.

ANNUAL SECRETARIAL COMPLIANCE REPORT

The Company has undertaken an audit for the Financial Year 2024-25 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by Sumit Bajaj & Associates, Practicing Company Secretaries has been submitted to the Stock Exchange.

REPORTING OF FRAUD BY AUDITOR

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Boards report.

CORPORATE GOVERNANCE

The Company conforms to the norms of Corporate Governance as envisaged in the Listing Regulations with the BSE Limited. Pursuant to Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Report on the Corporate Governance and the Auditors Certificate on Corporate Governance are annexed to this report.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

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 there under. The policy aims to provide protection to employees at the 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 also constituted an Internal Complaints Committee, known as the Prevention of Sexual Harassment (POSH) Committee, to inquire into complaints of sexual harassment and recommend appropriate action.

The following is a summary of sexual harassment complaints received and disposed of during the year 2024-2025:

COMPLIANCE UNDER MATERNITY BENEFIT ACT, 1961

The Company had complied with all the provisions of the Maternity Benefit Act, 1961.

DETAILS OF APPLICATION/ANY PROCEEDINGS PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Neither any application was made nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 during the FY 2024-25.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VERIFICATION DONE AT THE TIME OF SETTELEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTIUTIONS ALONG WITH THE REASONS THEREOF

As the Company has not done any one-time settlement during the year under review, no disclosure is required in this regard.

WEBSITE

The Company is maintaining its functional website and the website contains basic as well as investor related information. The link of website is https://www.pasupatitextiles.com/

SECREATRIAL STANDARDS

The Company has followed the applicable Secretarial Standards, with respect to Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India.

APPRECIATION

The Board of Directors acknowledge with gratitude the co-operation and assistance extended by all its stakeholders, including its shareholders, employees/workers, bankers, customers, business associates and employees. The company also conveys special thanks to Central & State Government and its Bankers, who have helped the company from time to time for their continued support.

For & On Behalf of Board of Directors