Rajshree Sugars & Chemicals Ltd Directors Report

Your Directors have pleasure in presenting the 40^th Annual Report on the business and operations of the Company and the audited financial statements for the year ended 31^st March 2026.

1) Financial Highlights	2025-26	2024-25
Total Income	54,894.36	65,356.87
Profit before Finance Costs, Depreciation and Exceptional items	4,176.15	5,050.29
Less: Finance Costs	1,449.50	1,597.12
Depreciation	2,334.12	2,345.60
Profit / (Loss) from ordinary activities before Tax and exceptional items	392.53	1,107.57
Less : Exceptional items (Expense)	200.86	-
Profit / (loss) before tax	191.67	1,107.57
Tax Expenses	78.08	298.47
Profit / (loss) after Tax	113.59	809.10
Other comprehensive income /(loss), net of income tax	(7.11)	(101.34)
Total comprehensive income /(loss) for the period	106.48	707.76
Basic / Diluted earnings /(loss) per share of 10/- each, before / after extraordinary items	0.34	2.44

2) Dividend

In order to conserve the financial resources for operational requirements, the Board has not recommended any dividend for the year 2025-26. Also no amount has been transferred to reserves.

3) Financial Performance

During the financial year 2025-26, your Company earned a total income of Rs. 54,894.36 lakhs, as compared to Rs. 65,356.87 lakhs in the previous year. The net profit before tax was Rs. 191.67 lakhs, as against Rs. 1,107.57 lakhs in the previous year. The net profit after tax was Rs. 113.59 lakhs, compared to Rs. 809.10 lakhs in the previous year.

4) Operational Performance

The operational highlights of our sugar, cogeneration and distillery divisions for the year 2025-26 are as follows:

a) Sugar Division

Particulars	2025-26	2024-25
Sugarcane crushed (MT)	11,29,060	12,28,905
Recovery %	8.73	8.14
Sugar Produced (MT)	98,521	1,00,053
Sugar Sold (MT) - Domestic	88,523	1,17,347

During FY 2025-26, sugar production marginally declined by 1.53% compared to the previous year, mainly due to lower sugarcane availability. However, the average recovery improved from 8.14% in the previous year to 8.73% during FY 2025-26.

b) Cogeneration Division

In the fiscal year under review, the Cogeneration Division produced a total of 1,376 lakh units of power, compared to 1,488 lakh units in the previous year. The Company exported 831 lakh units during the year, as against 886 lakh units exported in the preceding year.

c) Distillery Division

During the year, the Distillery Division produced 177 lakh litres of alcohol, compared to 187 lakh litres produced in the previous year. The sales volume stood at 169 lakh litres, as against 192 lakh litres sold during the previous financial year.

5) Change in Registered Office

The Registered Office of the Company was shifted within the same city from "The Uffizi", 338/8, Avanashi Road, Peelamedu, Coimbatore, Tamil Nadu - 641004, to 1GV, 360, Kamaraj Road, Uppilipalayam, Coimbatore, Tamil Nadu - 641015, with effect from 1st September 2025.

6) Future Outlook

The management believes that no material uncertainty exists about the companys ability to continue as a going concern and accordingly it has prepared the financial statements on a going concern basis.

The ground water recharge in the command areas of the Company has been encouraging for cane planting, thereby supporting factory operations for at least next two years. However, emergence of Competitive crops with remunerative prices could pose a threat to the Sugarcane Cultivation. The company is taking special measures like providing subsidy to the farmers for cane planting, appointing service providers for the cultivation operations, promoting mechanical harvesting and arranging timely supply of quality seed materials. The company is also promoting wider row planting, drip irrigation, trash shredding, trash mulching and organic manure application. The companys R&D wing is also working on research and development of new and high yielding varieties.

In the sugar season 2025-26 (October to September), the Government had allowed an export of 1.5 million tons. With the production in Maharashtra and north Karnataka lower than the estimated numbers, the domestic prices took an upswing in the current seasons.

The ambitious ethanol program of the Central Government continues to be supportive to the sugar industry. The Government is formulating a policy for flexi-fuel vehicle adoption to mitigate energy supply disruptions. The draft rules in April 2026 were proposed to allow for higher ethanol blends, including the E85 and E100 (pure ethanol), for vehicles capable of handling them. However, transition to higher blends would require automotive manufacturers to introduce engines with appropriate technology.

Further, the Government policy on sugar would continue to have a significant bearing on the prospects of the industry in the coming years.

7) Fixed Deposits

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 (the Act) and the Companies (Acceptance of Deposits) Rules, 2014 during the year under review.

8) Auditors

Statutory Auditors: M/s. S. Krishnamoorthy & Co., Chartered Accountants, Coimbatore (Firm Registration No. 001496S), who were appointed as the Statutory Auditors of the Company, will complete their second consecutive tenure at the conclusion of the ensuing 40th Annual General Meeting (AGM). The Board places on record its sincere appreciation for the services rendered by M/s. S. Krishnamoorthy & Co. during their tenure as Statutory Auditors of the Company.

Based on the recommendation of the Audit Committee, the Board of Directors proposes the appointment of M/s. Karthikeyan & Jayaram, Chartered Accountants, Coimbatore (Firm Registration No. 007570S; Peer Review Certificate No. 017284, valid from 28th June 2024 to 30th June 2027), as the Statutory Auditors of the Company for a term of five consecutive financial years from 2026-27 to 2030-31, to hold office from the conclusion of the 40th AGM until the conclusion of the 45th AGM, subject to the approval of the shareholders at the ensuing AGM.

The proposed auditors have confirmed their eligibility and willingness to act as Statutory Auditors of the Company in accordance with Sections 139 and 141 of the Companies Act, 2013, and the rules made thereunder.

The necessary resolution for their appointment is being placed before the shareholders for approval at the ensuing AGM.

Cost Auditors: Pursuant to Section 148 of the Companies Act, 2013, read with the Companies (Cost Records and Audits) Rules, 2014, the products of the Company viz., Sugar, Industrial Alcohol, and Cogeneration of Power, are subject to mandatory cost audit. The Company has maintained the cost records as prescribed by the Central Government.

Based on the recommendation of the Audit Committee, the Board of Directors has re-appointed M/s. S. Mahadevan & Co., Cost Accountants (Firm Registration No. 000007), as the Cost Auditors of the Company to conduct the cost audit for the financial year ending 31st March 2027. The remuneration payable to the Cost Auditors has been fixed by the Board, and the resolution seeking ratification of the same by the shareholders, pursuant to Section 148(3) of the Companies Act, 2013, is being placed at the ensuing Annual General Meeting.

Secretarial Auditor: Pursuant to Section 204 of the Companies Act, 2013, and Regulation 24A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR), Mr. G. Soundarrajan, Practising Company Secretary (Membership No. 13993; CP No. 4993; Peer Review No. 2101/2022), has conducted the Secretarial Audit of the Company for the financial year 2025-26. Mr. G. Soundarrajan was appointed as the Secretarial Auditor of the Company for a term of five consecutive financial years from 2025-26 to 2029-30, as approved by the shareholders at the 39th Annual General Meeting held on 13th August 2025.

9) Reporting of Frauds by Auditors:

There were no frauds reported by the Auditors of the Company under Section 143(12) of the Act to the Audit Committee.

10) Conservation of energy, technology absorption, foreign exchange earnings and outgo

Annexed to this Report as (Annexure 1).

11) Corporate Governance Report (CGR)

The Company is committed to maintaining the highest standards of corporate governance and adherence to the corporate governance requirements prescribed by SEBI. The Company also follows several best corporate governance practices as prevalent globally. The report on Corporate Governance as stipulated under LODR forms an integral part of this Report as (Annexure 2). The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is also attached to the report on Corporate Governance.

12) Corporate Social Responsibility (CSR)

The Company is not required to spend any amount under Section 135 of the Act. The details regarding the CSR Committee and Policy are furnished in the CGR.

13) Changes in Directors and Key Managerial Personnel

During the year, the following changes in the composition of the Board of Directors / Key Managerial Personnel took place:

Name	Category / Designation	Change	Effective From
Ms. Rajshree Pathy (DIN : 00001614)	Non Independent - Non-Executive Chairperson - Promoter	Re-appointment *	13th August 2025
Mr. Rajan Balasubramanian (DIN :10309315)	Independent Director	Appointment**	13th August 2025
Mr. S. Krishnaswami (DIN : 08530320)	Independent Director	Second consecutive tenure completed	29th September 2025

* Re-appointed on retirement by rotation at the 39^th AGM.

** Appointment as an Independent Director for an initial term of five consecutive years commencing from the conclusion of the 39^th AGM and ending on the date of the 44^th AGM or on completion of five years, whichever is earlier.

Reappointment of Whole-time Director: Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors has approved the reappointment of Mr. R. Varadarajan (DIN: 00001738) as Wholetime Director of the Company for a further period of five consecutive years with effect from 5th June 2026, subject to the approval of the Members at the ensuing Annual General Meeting.

14) Statement on Formal Annual Evaluation by the Board

In accordance with the Companies Act, 2013 and SEBI regulations, the Board carried out a formal annual evaluation of its own performance, that of its Committees, and individual Directors, including Independent Directors and the Chairperson.

The evaluation was coordinated by the Nomination and Remuneration Committee (NRC) through structured online feedback forms circulated to all Directors. The submitted responses were compiled and presented by the Chairperson during a Board meeting.

The evaluation covered the Boards strategic oversight, governance, and performance monitoring; Committees were assessed on effectiveness, independence, and role clarity; Directors were evaluated on domain knowledge, participation, and strategic input. Independent Directors were additionally assessed on independence and objectivity, while the Chairpersons evaluation included leadership, discussion facilitation, and stakeholder focus.

The NRC adopted a five-point grading scale: Poor, Average, Good, Very Good, and Excellent.

15) Number of Board Meetings

During the year, 5(Five) Board Meetings were convened and held, the details of which, including attendance of directors, are given in the Corporate Governance Report.

16) Declaration given by Independent Directors

The Independent Directors of the Company have furnished declarations as required under Section 149(6) of the Act & Regulation 16 of LODR.

17) Whistle Blower Policy (Vigil Mechanism)

In accordance with LODR, the Company has established a Vigil Mechanism (Whistle Blower Policy) to enable Directors and employees to report genuine concerns regarding unethical conduct, actual or suspected fraud, and violations of the Companys Code of Conduct or ethics policies.

The mechanism provides adequate safeguards against victimization of those who report such concerns and allows for direct access to the Chairman of the Audit Committee in all cases.

The Whistle Blower Policy is available on the Companys website at: www.rajshreesugars.com/policies/

18) Particulars of Loans, Guarantees or Investments under Section 186

The Company has not given/ made any loan, guarantee or investment in terms of Section 186 of the Act during the year under review.

19) Anti - Sexual Harassment Policy

The Company has in place a policy for the prevention, prohibition, and redressal of sexual harassment of women at the workplace, in accordance with the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

As required under the Act, the Company has constituted an Internal Complaints Committee to address complaints in a fair and timely manner. For the financial year ended 31st March 2026, no complaints were received under the said Act.

20) Related Party Transactions

All related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business. There were no material contracts / arrangements / transactions with related parties during the year.

21) Material Changes & Commitments between end of financial year and this Report

There were no material changes that took place between the end of the financial year and this report.

22) Managerial Remuneration

The details of disclosures relating to Managerial Remuneration as required pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed (Annexure 3).

23) Nomination and Remuneration Policy

The Nomination and Remuneration Committee (NRC), in consultation with the Board of Directors, has framed a comprehensive Remuneration Policy in line with Section 178 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations. The policy aims to ensure fair, balanced, and performance- linked remuneration for Directors, Key Managerial Personnel (KMP), Senior Management Personnel (SMP), and other employees.

The policy ensures that remuneration is sufficient to attract and retain competent leadership, and that it maintains a clear relationship with performance benchmarks. It provides for a balance between fixed and incentive-based pay to support both short-term results and long-term goals of the Company.

The policy outlines the framework for appointment, evaluation, and removal of Directors, KMPs, and SMPs, along with remuneration structures, including provisions for shareholder approvals wherever applicable. It also mandates annual performance evaluations to ensure transparency and accountability.

The NRC is empowered to issue implementation guidelines and delegate responsibilities for effective execution. The policy is available on the Companys website at: www.rajshreesugars.com/policies .

24) Industrial Relations

During the year under review, your Company enjoyed cordial relationship with workers and employees at all levels.

25) Internal control systems and their adequacy

The Company has internal control systems which is commensurate with its size, nature and volume of operations.

26) Rajshree Sugars & Chemicals Limited (RSCL) Employees Stock Option Plan 2012

A detailed report as required under SEBI (Share based Employee Benefits and Sweat Equity) Regulations, 2021 on the "RSCL Employees Stock Option Plan 2012" forms part of this report, as (Annexure 4).

27) Secretarial Audit

Pursuant to Section 204 of the Companies Act, 2013 and the rules made thereunder, the Secretarial Audit Report for FY 2025-26, issued by Mr. G. Soundarrajan, Practising Company Secretary, is annexed as (Annexure 5). The report contains no qualifications, reservations, or adverse remarks.

28) Annual Return

In terms of Section 92(3) of the Act, read with Companies (Management and Administration) Rules, 2014, The Annual Return of the Company in Form MGT-7 filed for the Financial year ended 31st March 2025 has been placed on the website of the Company i.e. https://www.rajshreesugars.com/annual-return-mgt-7/ .

29) Transfer of Amounts to Investor Education and Protection Fund (IEPF)

In accordance with Section 124(5) of the Companies Act, 2013, no dividend is currently pending for transfer to the Investor Education and Protection Fund (IEPF), except for an unpaid amount of 39,729 for the financial year 2009-10. The transfer of this amount is held in abeyance due to Court orders.

As required under the IEPF (Uploading of Information regarding Unpaid and Unclaimed Amounts) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed dividend amounts as on 28th August 2017 on its website (www.rajshreesugars.com ) and on the website of the Ministry of Corporate Affairs.

Additionally, the Company transferred the equity shares of shareholders who had not claimed dividends for seven consecutive years to the credit of the IEPF on 6th December 2017, via Form IEPF-4. Shareholders may claim such shares and dividends by following the procedure prescribed on the IEPF Authoritys website: https://www.iepf.gov.in/IEPF/refund.html .

30) Directors Responsibility Statement

In terms of clause (c) of sub-section (3) of Section 134 of the Act, the Directors state that:

i) in the preparation of the annual accounts / financial statements, the applicable accounting standards have been followed along with the proper explanation relating to material departures; if any.

ii) accounting policies as selected have been applied consistently and the judgments made and estimates 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 / loss of the Company for the year under review.

iii) proper and sufficient care has been taken 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 annual accounts / financial statements have been prepared on a going concern basis.

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

vi) a proper system has been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

31) Code of Conduct

Directors, Key Managerial Personal and Senior Management Personnel of the Company have affirmed adherence to the Code of Conduct pertinent to the Directors and employees of the Company and the declaration in this regard made by Wholetime Director, as required under LODR forms part of CGR.

The code is available in the website of the company www.rajshreesugars.com/Code-of-conduct-fair-disclosure

32) Prevention of Insider Trading

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and Designated Persons of the Company, as per SEBI (Prohibition of Insider Trading) Regulations, 2015.

The code is available in the website of the Company www.rajshreesugars.com/Code-of-conduct-fair-disclosure

33) Risk Management Policy

The Company has formulated a Risk Management Policy as required under LODR. The Company has also formulated a specific policy on Forex and Interest Rate Risk Management Policy for Currency and Interest Rate Risk Management.

The Board perceives the risk of recurring lower sugar recovery in the State of Tamil Nadu as compared to minimum recovery for which sugar mills are to pay the Fair and Remunerative Price. Lower capacity utilization is also a concern.

The Tamil Nadu Industry has also the option of producing Ethanol. The Tamil Nadu Government has issued an Ethanol Blending Policy 2023 to attract investments in molasses/grain-based ethanol programme to make the state self-sufficient in meeting the estimated annual requirement of 130 crore litres. However, the State has the limited scope as availability of molasses is limited.

The Tamil Nadu government has been allowing the manufacturers of Indian Made Foreign Liquor to import a major share of the requirement of Extra Neutral Alcohol (ENA) (raw material for processing into liquor) from other neighboring states, giving an unfair advantage to the other states due to comparatively lower rate of taxes. This has an adverse effect in the cash flow stream of sugar manufacturers in the state of Tamil Nadu, as ENA is also one of the main streams of revenue.

The details about the risks being faced by the Company are furnished in the Management Discussion & Analysis Report (Annexure 6).

34) Significant & material orders passed by regulator or courts or tribunals impacting going concern status and companies operations in future.

There have been no significant and material orders passed by any Regulator / Court / Tribunal impacting the going concern status and companys operations in future.

35) Compliance with Secretarial Standards

The Company has complied with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India and approved as such by the Central Government, as per the provisions of the Act.

36) Details of any applications made or proceedings pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year.

The Company confirms that no such applications have been made, and there are no proceedings pending.

37) 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.

The Company affirms that no one-time settlement was entered into during the year under review.

38) Disclosure on Compliance with the Maternity Benefit Act, 1961

The Company has complied with the applicable provisions of the Maternity Benefit Act, 1961 and the Maternity Benefit (Amendment) Act, 2017.

39) Acknowledgement

Your Directors thank the Banks and Financial Institutions for their valuable and timely financial assistance and support provided by them to the Company. Your Directors also thank the cane growers, suppliers, Government Institutions and others for the cooperation extended to the Company. The Board also places on record its appreciation of the dedicated services rendered by the employees of the Company.

May Goddess Lakshmi shower her blessings for the continued prosperity of the Company.

For and on behalf of the Board	R VARADARAJAN	SHEILENDRA BHANSALI
Place : Coimbatore	Wholetime Director	Independent Director
Date : 20th May 2026	DIN 00001738	DIN 00595312