Pudumjee Paper Products Ltd Directors Report

The Directors have pleasure in presenting before you the 12^th Annual Report of the Company together with the Audited Financial Statements for the year ended 31^st March, 2026. The accounts are prepared in accordance with the Companies (Indian Accounting Standards) Rule, 2015 (IND AS) prescribed under Section 133 of the Companies Act, 2013 ("the Act").

FINANCIAL RESULTS :

	2025-26	2024-25
The Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)	14,501.27	14,503.63
Less:
i) Finance cost	335.56	321.04
ii) Depreciation/Impairment	1,540.56	1,310.39
The net profit before Exceptional items and Tax	12,625.15	12,872.20
Exceptional Items	-	-
The net profit before Tax	12,625.15	12,872.20
Less:
Provision for Current Tax	2,990.00	3,275.00
Provision/(Saving) for Deferred Taxation	275.99	21.23
Net Profit After Tax	9,359.16	9,575.97
Add:
Other Comprehensive Income/(Expense) (Net of Tax)	(129.30)	51.46
The balance of Profit brought forward from last year	37,297.25	28,439.52
Total	46,527.11	38,066.95
Less:
Dividend Paid on Equity Shares	569.70	569.70
Transfer to General Reserve	200.00	200.00
Total	769.70	769.70
Balance proposed to be carried forward to next years accounts	45,757.41	37,297.25

DIVIDEND :

The Board of Directors recommends the payment of Dividend for the year ended 31^st March, 2026 at the rate of Rs.0.60/- per share. Subject to approval of Shareholders, the Equity Dividend shall be paid, subject to the provision of Section 126 of the Act to those Shareholders whose names stand on the Register of Members on 02^nd September, 2026.

The Dividend in respect of shares held in electronic form, will be paid to all those beneficial owners of the shares as per the details furnished by depositories for the purpose at the close of business hours on 24^th August, 2026.

OPERATIONS:

The Company is a Specialty Paper manufacturing company offering niche quality of papers and has long standing goodwill in the market.

The Company has maintained its performance in terms of revenue at Rs. 808 crores (Rs. 809 crores in the last year) by larger tonnage of paper by 1675 MT, by lowering average net sales realization of paper per MT with a view to pass on the benefit of cost reduction to the customer.

There is strong emphasis in other companies manufacturing commodity papers to compete with some of the products manufactured by the Company considering higher realisations fetched by Pudumjeess products. Whilst in some cases these competitors do have inherent advantage of lower cost due to their location, the others tend to produce somewhat lower quality of papers at lesser costs. At times, therefore, it becomes necessary for the Company to pass on the benefit of cost reduction to customers without compromising on stringent and consistent quality of papers and its margins.

The Company has successfully completed its capex programme of over Rs.110 crores by installing an AFBC boiler, modernizing certain important parts of three of the paper making machines and setting up of a Solar Power Plant.

The 15.4 MW Solar Power Plant has been successfully setup and operationalized in December 2025 at Bhalwani near Solapur. With this, the Companys annual power requirement of about 38% would be comprising of renewable energy which apart from reducing cost of energy, will also reduce carbon footprints by about 27000 MT.

The recent general order passed by Maharashtra Electricity Regulatory Commission (MERC) in March 2026 has changed the banking norms thereby restricted consumption of power generated to only during solar hours which has the effect of reducing the aforesaid percentage to 31% with the lapse of remaining power. This matter is currently in appeal before the Appellate Tribunal for Electricity (APTEL) which has stayed operation of the said order until its judgement.

The management is also actively considering to setup Battery Energy Storage System (BESS) at Bhalwani to avoid lapse of aforesaid power and also to generate more power by setting up of another Solar Power Plant in due course once clarity on the regulatory framework for banking emerges and MERCs Regulations for BESS are announced.

The Company is in the process of obtaining Environmental Clearance for setting up a Specialty Paper manufacturing facility of 68,000 MT per annum at Mahad which has become necessary after the Supreme Court judgement in Vanashakti versus Union of India in August 2025, setting aside Central Governments Notification dated 29.1.2025. Simultaneously the Company is also in advanced stage of discussion with machinery manufacturers for the project.

Hygiene Products Division has achieved about 17% of improvement in its revenue. The Division mainly caters to Institutional customers such as Corporates, Airports, Business Hotels, Restaurants etc. The newly established vertical of supply of Paper Bags and Paper Cups for various applications including food grade segment, has received good response. The business of this segment is dominated by many unorganized players and, therefore, it may take some more time to achieve fair profitability.

TRANSFER OF AMOUNTS AND SHARES TO INVESTOR EDUCATION AND PROTECTION FUND :

Pursuant to the provision of Sections 124 and 125 of the Act, relevant amounts like unclaimed dividend etc., which remained unpaid or unclaimed for a period of seven years have been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund (‘IEPF).

In compliance with these provisions read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has transferred 1,08,100 shares to the Demat Account of the IEPF Authority maintained with NSDL, in respect of which dividend had remained unpaid/unclaimed for a consecutive period of 7 years or more. The details of the Shareholders whose shares transferred to IEPF Authority and procedure to claim refund of unclaimed dividend amount and shares from IEPF authority are available on the website of the Company viz: https://pudumjee.com/unclaimed-dividends/.

FIXED DEPOSITS :

The Company accepts fresh/renewal of fixed deposits from the public and as on 31^st March, 2026 stood at Rs.798.25 Lakhs as against Rs. 808.80 Lakhs at the end of the previous year (i.e. Fixed Deposit Liability).

During the year, the Company has accepted/renewed such deposits aggregating to Rs.2.10 Lakhs, and all the deposits falling due for repayment during the year were fully repaid on maturity except unclaimed deposits numbering 31 with an amount of Rs. 20.65 Lakhs as at the end of the year.

There were no over dues on account of principal or interest on public deposits other than the unclaimed deposits as at the year end and there have been no default in repayment of deposits or payment of interest thereon. There are no deposits which are not in compliance with the requirements of Chapter V of the Act read with Companies (Acceptance of Deposits) Rules, 2014.

AUDITORS:

i. STATUTORY AUDITORS :

The Members of the Company at the 8^th Annual General Meeting re-appointed M/s. J. M. Agrawal & Company, Chartered Accountants, as Statutory Auditors for further period of five years till the conclusion of 13^th Annual General Meeting of the Company.

There is no adverse remark or qualification in the Statutory Auditors Report annexed to this Annual Report.

The Auditors have reported that there is no fraud on or by the Company noticed or reported during the year.

ii. SECRETARIAL AUDITOR :

Pursuant to provision of Section 204 read with Section 134(3) of the Act, the Board had appointed M/s. SIUT & CO LLP, Practicing Company Secretaries, Pune to conduct Secretarial Audit of the Company for the Financial Year 2025-26. The Secretarial Audit Report for the Financial Year 2025-26 is annexed hereto as Annexure - 1.

There is no adverse remark or qualification in the Secretarial Audit Report.

The Company has complied with the applicable Secretarial Standards during the year issued by the Institute of Company Secretaries of India.

Further in compliance with Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 204 of the Act, the Board of Directors of the Company at its meeting held on 26^th May, 2025, have approved the appointment of M/s. SIUT & CO LLP, Practicing Company Secretaries, Pune as Secretarial Auditors of the Company for a term of five consecutive years commencing from FY 2025-26 till FY 2029- 30.

iii. COST AUDITOR :

Pursuant to provision of Section 148 of the Act, the Board has appointed Mr. Narhar K. Nimkar (Membership No. F-6493), Cost Accountants in Practice, Pune to conduct the audit of the Cost Records of the Company relating to "PAPER" for the Financial Year 2025-26. As required under the Act, a resolution seeking Shareholders approval for the remuneration payable to the Cost Auditors forms part of Notice convening the 12^th Annual General Meeting of the Company.

DETAILS OF APPOINTMENT OF DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) :

In terms of provisions of the Act, Dr. Ashok Kumar (DIN: 07111155), Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

The details of the Directors of the Company, proposed to be re-appointed at the 12^th Annual General Meeting, as required by Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2 issued by the Institute of Company Secretaries of India are provided as Annexure at the end of the Notice convening the 12^th Annual General Meeting of the Company.

The Shareholders of the Company had re-appointed Mr. Vinod Kumar BeswaL (DIN: 00120095) and Mr. Nandan Damani (DIN: 00058396) as Non-Executive Independent Directors of the Company for a second term at the Annual General Meeting held on 21^st August, 2021, for a period commencing from 17^th September, 2021 up to 20^th October, 2025. Accordingly, Mr. BeswaL and Mr. Damani ceased to be Directors of the Company with effect from 20^th October, 2025 upon completion of their respective tenure as Independent Directors.

Further, the Shareholders of the Company had re-appointed Mrs. Madhu Dubhashi (DIN: 00036846) as Non-Executive Independent Director of the Company for a second term at the Annual General Meeting held on 21^st August, 2021, for a period commencing from 17^th September, 2021 up to 13^th November, 2025. Accordingly, Mrs. Dubhashi ceased to be Director of the Company with effect from 13^th November, 2025 upon completion of her tenure as Independent Director.

The Board places on record its sincere appreciation for the valuable guidance, support and contributions rendered by Mr. Vinod Kumar BeswaL, Mr. Nandan Damani and Mrs. Madhu Dubhashi during their association with the Company.

Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, at its meeting held on 10^th November, 2025, appointed Mrs. ShaiLaja Nair (DIN: 11343122) as an Additional Director in the capacity of Non-Executive Independent Director of the Company for a period of five consecutive years with effect from 14^th November, 2025 up to 13^th November, 2030, subject to approval of the Members of the Company.

The appointment of Mrs. ShaiLaja Nair as an Independent Director was subsequently approved by the Members of the

Company through Postal Ballot on 17^th December, 2025 in accordance with the provisions of the Act, the Rules framed thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the recommendation of the Nomination and Remuneration Committee and in compliance with the SEBI (Listing ObLigations and DiscLosure Requirements) ReguLations, 2015, the Board of Directors at its meeting held on 31^st January, 2026 re-appointed Dr. Ashok Kumar (DIN: 07111155) as an Executive Director of the Company for a further term of five years with effect from 27^th May, 2026 to 26^th May, 2031, subject to the approval of the Members. Subsequently, the Members of the Company approved the said re-appointment through PostaL Ballot on 05^th March, 2026.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the appLicabLe provisions of the Act and appLicabLe reguLations of the SEBI (Listing ObLigations and DiscLosure Requirements) Regulations, 2015 and also confirming that they are not debarred from holding the office of Director by virtue of any SEBI order or any other such authority.

The Board of Directors is of the opinion that the Independent Directors holds the highest standard of integrity and possess necessary expertise and experience including proficiency in the field in which the Company operates.

MEETINGS :

During the year 4 Board Meetings and 4 Audit Committee Meetings were convened and held. The detaiLs of which are given in the Corporate Governance Report that forms part of this AnnuaL Report. The intervening gap between the Meetings was within permissibLe period prescribed under the Act and SEBI (Listing ObLigations and DiscLosure Requirements) ReguLations, 2015.

CORPORATE SOCIAL RESPONSIBILITY (CSR) :

The Board of Directors has constituted the Corporate SociaL ResponsibiLity (CSR) Committee in accordance with the provisions of Section 135 of the Act & RuLes made thereunder.

During the year under review, Mr. Nandan Damani, Chairman of the Committee and Non-Executive Independent Director, and Mr. Vinod Kumar BeswaL, Non-Executive Independent Director, ceased to be members of the Committee upon their retirement as Non-Executive Independent Directors of the Company with effect from 20^th October, 2025. SubsequentLy, Mr. DiLip J. Thakkar and Mr. Sanjay Kumar Singh were inducted as members of the Committee with effect from 21^st October,2025, and Mr. Ved P. Leekha was appointed as Chairman of the Committee with effect from 10^th November, 2025.

As on 31^st March, 2026, the Committee comprised Mr. Ved P. Leekha, Chairman and Non-Executive Non-Independent Director, Mr. Basant Kumar Khaitan, Non-Executive

Independent Director, Mr. Surendra Kumar Bansai, NonExecutive Non-Independent Director, Mr. Diiip J. Thakkar, Non-Executive Independent Director and Mr. Sanjay Kumar Singh, Non-Executive Independent Director.

The major roie of this Committee is to formulate, recommend, implement and monitor the CSR policy, activities to be undertaken by the Company and to meet/contribute expenditure towards its recommended Corporate Social Responsibility objectives. This Committee carried out the CSR Activities pursuant to section 135 read with Schedule VII of the Act as amended from time to time and as per the CSR policy of the Company.

For the financial year under review, the Company was required to spend Rs.225 Lakhs on CSR activities pursuant to Section 135(1) of the Act.

In fulfillment of this obligation, the Company disbursed the entire amount of Rs.225 Lakhs towards various approved CSR initiatives through designated implementing agencies, in line with its CSR Policy. Of this, Rs.95.58 Lakhs was utilized by the implementing agencies by 31^st March 2026. The remaining unutilized amount of Rs.129.42 Lakhs, allocated for ongoing projects, was transferred to the Companys Unspent CSR Account in accordance with Section 135(6) of the Act.

These projects are currently in progress and are expected to be completed upon achieving its objectives The Company continues to cioseiy monitor their implementation to ensure meaningful and timely outcomes.

The Company remains strongly dedicated to acting as a responsible corporate citizen and continues to consider Corporate Social Responsibility (CSR) a core element of its business values and approach.

The CSR Committee affirmed that the implementation and monitoring of the CSR projects during the year was in compliance with the CSR objectives and CSR policy of the Company.

The CSR Policy of the Company is available on the website of the Company viz: https://pudumjee.com/wp-content/ upioads/2026/05/PPPL-Corporate-Sociai-Responsibiiity- Poiicy.pdf.

The other relevant disclosures as stipulated under the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended are given in Annexure-2.

PARTICULARS OF LOAN(S), GUARANTEE(S) OR INVESTMENT(S) :

The particulars of loans, guarantees and investments as per Section 186 of the Act by the Company have been disclosed in the financial statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES :

A policy on Related Party Transactions has been adopted by the Board of Directors at its meeting held on 14^th November, 2015 for determining the materiality of transactions with related parties and dealings with them. The said policy is available at the Companys website at https://pudumjee. com/wp-content/upioads/2026/02/PPPL-Reiated-Party- Transactions-Poiicy-1.pdf. The Audit Committee reviews aii related party transactions quarterly and also as and when feit necessary.

Pursuant to Sections 134 (3), 188 (1) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 the particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Act in Form AOC -2 are provided as Annexure-3.

ANNUAL EVALUATION OF PERFORMANCE OF BOARD DIRECTOR(S) AND COMMITTEE(S) :

As required under Act, a meeting of the Independent Directors was held on 31^st January, 2026 to evaluate the performance of the Non-Independent Directors, wherein the evaluation of performance of the Non-Independent Directors, including the Chairman and also of the Board as a whole was made, against pre-defined and identified criteria.

The criteria for evaluation of the performance of the Independent Directors, Chairman and the Board, was finalized by the Nomination and Remuneration Committee in its meeting held on 22^nd January, 2016, the said committee has carried out evaluation of the performance of every Director. The said criteria is available at the Companys website at https://pudumjee.com/wp-content/upioads/2025/04/ Poiicy-on-Evaiuation-of-Performance-of-Directors.pdf. The Board of Directors at their meeting held on 31^st January, 2026 has evaluated the performance of Independent Directors. The performance of the Committee was also generally discussed and evaluated.

While evaluating, the principles and guidelines issued vide master circular no. SEBI/HO/CFD/PoD2/CIR/P/0155 of Securities Exchange Board of India dated 11^th November, 2024 on Board Evaluation have been taken into account.

FAMILIARISATION PROGRAMME :

The details of programmes for familiarisation of Independent Directors with the Company is available at the Companys website at https://pudumjee.com/wp-content/ upioads/2026/02/PPPL-Famiiiarisation-Programme-for- Independent-Directors.pdf

RISK MANAGEMENT POLICY :

In accordance with the requirements of the Act, the Company has adopted and implemented a Risk Management Policy for identifying risks to the Company, procedures to inform Board members about the risk assessment & minimization procedures, monitoring the risk management plan, etc.

VIGIL MECHANISM / WHISTLE BLOWER MECHANISM :

The Company promotes ethical behavior in aii its business activities and has estabiished a vigii mechanism for Directors and Empioyees to report their genuine concerns.

Pursuant to Section 177 of the Act read with Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated a policy "Vigil Mechanism/Whistie Blower Policy", wherein the Employees/ Directors/Stakehoiders of the Company are free to report any unethical or improper activity, actual or suspected fraud or violation of the Companys Code of Conduct. This mechanism provides safeguards against victimization of Employees, who report under the said mechanism. During the year under review, the Company has not received any complaint under the said mechanism. The said policy is available at the Companys website at https://pudumjee. com/poiicies/.

PARTICULARS OF EMPLOYEES :

As required under Section 197(12) of the Act read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the statement giving required details is given in the Annexure-4 and 4A to this report.

In accordance with the provisions of Section 197 (12) of the Act, read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the statement containing the names of the top ten employees in terms of remuneration drawn and other relevant particulars is provided in a separate annexure forming part of this Report. Pursuant to Section 136 of the Act, the Annual Report is being sent to the Shareholders excluding the said annexure. Shareholders who wish to obtain a copy of the annexure may write to the Company Secretary at investors.relations@pudumjee.com.

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

An Internal Complaints Committee (Sexual Harassment Committee) has been constituted, under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressai) Act, 2013, to deal with the complaints, if any, from the Company and other Companies in the Pudumjee Group.

During the year under review, no complaints relating to discrimination or harassment, including sexual harassment, were received by the Committee. Consequently, there were no complaints pending for resolution for more than ninety days, and no complaints remained unresolved as on 31^st March, 2026.

DISCLOSURE UNDER THE MATERNITY BENEFIT ACT, 1961

Your Company is compliant with the statutory provisions of the Maternity Benefit Act, 1961.

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

As required under Section 134(3)(m) of the Act, read with the Companies (Accounts) Rules, 2014, the information relating to

Conservation of Energy, Technology Absorption and Foreign Exchange earnings & outgo is annexed as Annexure-5 to this Report.

REPORT ON CORPORATE GOVERNANCE :

Your Companys philosophy on Corporate Governance, sets the goal of achieving the highest level of transparency with integrity in all its dealings with its Stakeholders including Shareholders, Employees, Lenders and Others. A report on Corporate Governance along with a Certificate from the practicing Company Secretary regarding the Compliance of Conditions of Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report as Annexure-6.

MATERIAL CHANGES AND COMMITMENTS, IF ANY:

There are no adverse material changes or commitments that occurred after 31^st March, 2026, which may affect the financial position of the Company or may require disclosure.

ANNUAL RETURN:

Pursuant to the provisions of Act, draft of Annual Return for the financial year 2025-2026 is available on the website of the Company at https://pudumjee.com/financial-results/.

REMUNERATION POLICY :

In accordance with the provisions of Section 178 and other applicable provisions of the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated remuneration policy which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors. The said policy may be referred to, at the Companys website i.e., https://pudumjee.com/poiicies/.

SIGNIFICANT AND MATERIAL ORDERS :

There is no significant and material order passed by the Regulators or Courts or Tribunals impacting the going concern status and Companys operations in future.

DIRECTORS RESPONSIBILITY STATEMENT :

The Directors confirm that:

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

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

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

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

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

f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENTS :

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Bankers, Customers, Vendors and Investors of the Company for their continued support during the year.

The Directors also wish to place on record their deep sense of appreciation for the dedication and contribution made by employees at all levels and look forward to their support in future as well.