Shree Digvijay Cement Co. Ltd Management Discussions

GLOBAL ECONOMIC SCENARIO AND OUTLOOK

World Bank, predicts a global economic growth of 2.7% in 2025-2026. Emerging market and developing economies (EMDEs) of global areprojected to continue driving significant growth, though their long-term growth outlook is weaker than in previous decades. India is expected to be a major driver of global years 2026 and growth,with a steady 6.7% growth in both fiscal 2027.

Global Growth

The global economy is projected to grow at a steady pace of

2.7% in 2025 and 2026, the same as in 2024. This growth is below the average of the past decade and is expected to be insufficient to foster sustained economic development. EMDEs, which contribute about 45% of global GDP, are expected to continue driving growth. India is projected to grow at 6.7% in both fiscal years 2026 and 2027, outpacing global and regional peers, according to the PIB report.

Emerging Market and Developing Economies (EMDEs)

2000, now EMDEs have seen significant contributing about 45% of global GDP. India, China, and Brazil are major drivers of global growth, having collectively accounted for about 60% of annual global growth since the start of the century. However, the long-term growth outlook for EMDEs is weaker than in previous decades.

Challenges and Risks

Rising trade tensions and persistent inflation pose risks to global growth. Trade restrictionsin2024werefive times the

2010-19 average, leading to a drop in overall economic growth. Developing countries face challenges with weak near-term growth, high debt levels, and limited access to food, potentially impacting progress on global priorities. The report highlights the need for policies that address these challenges and strengthen global trade governance.

INDIAN ECONOMY & OUTLOOK FOR FY2025-26

The Indian economy is estimated to achieve a growth of 6.5 per cent in FY25 despite considerable external headwinds. This was accompanied by a pick-up in growth from 5.6 per cent in Q2 FY25 to 6.2 per cent in Q3 FY25. This performance was driven by strong agricultural and service sector performance on the supply side and a steady increase in consumption and core merchandise and services exports on the demand side. All sectors are estimated to grow close to their trend rates. The International Monetary Fund, in its recent Article IV report published in February, 2025, has stated that Indias prudent macroeconomic policies and reform-driven approach have positioned it as the fastest-growing major economy.

Global trade continues to be affected by uncertainty in the policy environment. The Global Trade Policy Uncertainty Index rose to a record high of 237.4 in Q4 2024. Tariff-related developments in multiple countries have heightened trade-related risks, affecting investment and trade flows globally. Consequently, Indias exports have recorded softer growth thus far in FY25. However, a robust services trade surplus continues to offset the impact of lower growth in merchandise exports. Within the capital account, gross FDI inflows were higher on a YoY basis. However, net FDI is significantly lower in FY25 due to a rise in repatriation and outbound FDI. Despite the sell-off by FPIs and heightened global market turbulence, the Rupee continues to be amongst the least volatile currencies as compared to its peers. Union Budget 2025-26 has anchored itself on the agenda of Viksit Bharat, setting out its dimensions and proposing development measures and paths leading to such an outcome. The Budget has also posited agriculture, MSMEs, Investment and Exports as engines of growth, outlining initiatives under each of them, thereby generating optimism about continued resilience in the economy amidst geo-political constraints.

Geopolitical tensions, trade policy uncertainties, volatility in international financialmarket commodity prices and uncertainties pose considerable risks to the economic growth outlook, globally and locally. One offsetting positive is the outlook for commodity prices. Domestic private sector capital formation, focused on Indias solid fundamentals and economic prospects, will be an important driver of economic growth in

FY26. Supportive fiscal measures, accommodative monetary policy,andtheUnionBudgetsfocusonlonger-termdevelopment drivers and reform will bolster domestic economic resilience amidst significant global uncertainties.

GOVERNMENT INITIATIVES

In order to help private sector companies thrive in the industry, the Government has been approving their investment schemes. Some of the initiatives taken by the Government of late are as below:

• As per the Union Budget 2025-26, the government approved an outlay of 2,87,333 crore (US$ 33.08 billion) for the Ministry of Road Transport and Highways i.e., 3% higher as compared to the previous budget. Additionally, the budget allocated 11.2 lakh crore (US$ 129.04 billion) for Infrastructure sector. To promote increased private sector involvement, the government has put forward a range of proposed initiatives.

• The National Infrastructure Pipeline (NIP) expanded to 9,305 projects from 7,400 projects.

• Go vernment schemes like the Pradhan Mantri Yojana (PMAY) for affordable housing and PM Gati Shakti National Master Plan for infrastructure are driving cement demand. PM Gati Shaktis focus on transport networks and PMAYs expansion will further increase cement consumption in coming years.

• In October 2021, Prime Minister, Mr. Narendra Modi, launched the ‘PM Gati Shakti - National Master Plan (NMP) for multimodal connectivity. Gati Shakti will bring synergy to create a world-class, seamless multimodal transport network in India. This will boost the demand for cement in the future.

ROAD AHEAD

The Indian government is firmly focused on infrastructure development to spur economic growth and is striving for full infrastructurecoveragetoestablishsmartcities.Thegovernment plans to increase the capacity of railways and the facilities for handling and storage to enable the transfer of cement and cut out on transportation costs. These measures are expected to result in increased construction activity in the country, thereby boosting demand for cement.

The eastern states of India are likely to be the newer and untapped markets for cement companies and could contribute to their bottom line in future. In the next 10 years, India could become the main exporter of clinker and grey cement to the Middle East, Africa, and other developing nations of the world. Cement plants near the ports, for instance, the plants in Gujarat and Visakhapatnam, will have an added advantage for export and will logistically be well-armed to face stiff competition from cement plants in the interior of the country. Indias cement production capacity is expected to reach 550 MT by FY25. Number of foreign players are also expected to enter the cement sector owing to the profit margins and steady demand.

INDIAN CEMENT INDUSTRY: OUTLOOK AND OPPORTUNITIES

India is the second-largest cement producer in the world and accounts for over 8% of the global installed capacity. Of the total capacity, 98% lies with the private sector and the rest with the public sector. The top 20 companies account for around 70% of the total cement production in India. As India has a high quantity and quality of limestone deposits throughout the country, the cement industry promises huge potential for growth.

In FY23, the market size of Indias cement industry reached 3.96 billion tonnes and is expected to touch 5.99 billion tonnes by FY32, exhibiting a CAGR of 4.7% during FY24-FY32. Indias cement production reached 374.55 million tonnes in FY23, a growth rate of 6.83% YoY.

Indian port traffic for cement in the period of Apr-Nov24 saw an increase at 4.82 million metric tonnes.

AwasThe Indian cement industry projects an 8% increase in sales by CY25, fuelled by government infrastructure investments, although it faces challenges such as reduced sales realization in CY24.

The Indian cement sectors capacity is expected to expand at a Compound Annual Growth Rate (CAGR) of 4-5% over the four-year period up to the end of FY27. It would thus begin the 2028 financial year at 715-725 MT/ year in installed capacity.

Cement consumption is expected to reach 450.78 million tonnes by the end of FY27.

At present, the installed capacity of cement in India is 600 MTPA with a production of 391 MTPA.

The Indian cement industry is proceeding with expansion plans and capacity additions, despite dampened demand expected to persist through the first half of FY25. Cement giants foresee a modest 6-7% volume growth this fiscal year, period has begun with a pricing downturn.

The cement sector saw a modest growth of 2-3% in Q1 FY25, primarily due to a slowdown in construction during the Lok Sabha elections. However, ICRA projects a 7-8% growth for FY25, driven by strong demand in infrastructure and housing.

In CY24, the cement sector in India witnessed a significant increase in mergers and acquisitions, with more than ten deals announced, representing the highest level of activity since CY14. The total value of these transactions surpassed US$ 3.5 billion, largely fuelled by major players such as UltraTech Cement and Adani-promoted Ambuja Cements, especially within the South Indian market.

FDI inflows in the industry, related to the manufacturing of cement and gypsum products, reached 51,074 crore (US$ 7.91 billion) between April, 2000-September, 2024.

According to Confederation of Real Estate Developers Associations of India (CREDAI), the market size of the real estate sector in India is projected to reach 112 lakh crore (US$ 1.3 trillion) by FY34 and 449 lakh crore (US$ 5.17 trillion) by 2047. Currently, the Indian real estate market is valued at 24 lakh crore (US$ 300 billion).

The Government of India is strongly focused on infrastructure development to boost economic growth and is aiming for 100 smart cities. The Government also intends to expand the capacity of railways and the facilities for handling and storage to ease the transportation of cement and reduce transportation costs. These measures would lead to increased construction activity, thereby boosting cement demand.

The future outlook of the cement sector looks on track with the pandemic easing out.

In the next 10 years, India could become the main exporter of clinker and grey cement to the Middle East, Africa, and other developing nations of the world. Cement plants near the ports, for instance, the plants in Gujarat and Visakhapatnam, will have an added advantage for export and will logistically be well-armed to face stiff competition from cement plants in the interior of the country. Indias cement production capacity is expected to reach 550 MT by FY25. The cement demand in India is estimated to touch 419.92 MT by FY27 driven by the expanding demand of different sectors, i.e., housing, commercial construction, and industrial construction.

Robust Demand

The Indian cement industry projects an 8% increase in sales by CY25,fueledbygovernmentinfrastructureinvestments,although it faces challenges such as reduced sales realization in CY24.

Attractive Opportunities

The Mumbai-Ahmedabad Bullet Train Corridor is significantly boosting the cement and construction industry, utilizing around 20,000 cubic meters of cement daily-equivalent to eight 10-story buildings. This project, spanning 508 km with multiple stations and tunnels, has generated substantial employment, with about 20,000 workers engaged daily.

Increasing Investments

FDI inflows in the industry, related to the manufacturing of cement and gypsum products, reached 51,074 crore (US$ 7.91 billion) between April, 2000-September, 2024.

*As per the Union Budget 2025-26, the government approved an outlay of 2,87,333 crore (US$ 33.08 billion) for the Ministry of Road Transport and Highways i.e., 3% higher as compared to the previous budget.

Indias infra-driven economy will lead to a CAGR growth of 7-8% in cement demand

Cement demand in India is projected to remain robust in the coming years, with a compound annual growth rate (CAGR) of 7-8% over FY25E-27E, according to a report by JM Financial. Although a brief slowdown is expected in FY25E, the sector is set to experience strong growth, underpinned by positive demand fundamentals and structural changes within the industry.

Key drivers of this growth include significant development and a rise in construction activities across the country. The shift towards cost optimisation and de-risking strategies among cement manufacturers is also expected to mitigate the industrys cyclical nature, promoting long-term profitability.

COMPANYS PERFORMANCE

During the year under review, earnings before interest, tax and depreciation (EBITDA) of the Company stood at 6,706.25 Lakhs, as compared to 15,494.21 Lakhs in the previous year. This fall in EBITDA due to extremely lower cement price and subdued demand. The demand for cement may further increase, as the infrastructure projects such as bridges, roads, ports, metro rails and low budget housing segments gain momentum, creating prospects for expansion in this sector. The long-term prospect for cement is anticipated to be favorable.

The Company keeps focusing on lowering costs, increasing operational efficiency, blended building the brand. To lower the risk of energy, the Company also focuses on reducing grid dependency by using more alternate fuels, solar and wind energy sources.

Operational Performance:

Particulars	Current year ended 31.03.2025	Previous Year ended 31.03.2024
Production:
• Clinker	10.05	10.34
• Cement	13.87	13.48
Sales :
Domestic
• Cement*	13.71	13.58
• Clinker	0.00	0.00
Export
• Cement	0.004	0.03
• Clinker	0.000	0.00

Financial Performance:

Particulars	Current Year Ended 31.03.2025	Previous Year Ended 31.03.2024
Revenue from Operations (Gross)	72,257.78	78,985.41
Add: Other Operating Income	256.87	178.59
Less: Total Expenditure	66,792.88	64,603.13
Profit before other income, interest, depreciation & tax	5,721.77	14,560.87
Add: Other Income	519.08	246.34
Profit before Interest Depreciation & Tax [PBIDT]	6,240.85	14,807.21
Add : Interest Income	465.40	687.00
Earning before Interest, Tax and Depreciation (EBITDA)	6,706.25	15,494.21
Less: Interest Expense	276.60	211.77
Less: Depreciation	2975.15	3,461.77
Profit before tax	3,454.50	11,820.67
Less: Tax Expenses	934.44	3,044.96
Profit for the year	2,520.06	8,775.71

Details of significant changes in key financial ratios are as given below:

Sr. No.	PARTICULARS	UOM	Year Ended 31.03.2025	Year Ended 31.03.2024
1	Contribution to Exchequer	in Lakhs	23,222.00	27,633.50
2	Total Income	in Lakhs	73,499.13	80,097.34
3	EBITDA	In Lakhs	6,706.25	15,494.21
4	EBITDA MARGIN	%	9.12%	19.34%
5	Profit Before Tax	In Lakhs	3,454.50	11,820.67
6	Profit After	In Lakhs	2,520.06	8,775.71
7	Net Worth	In Lakhs	36,364.21	38,120.66
8	ROE %	%	6.8%	24.9%
9	GROSS DEBT	In Lakhs	10,984.50	-
	Debt		0.23	-
10		Weight
	Equity		0.77	1.00
11	Working Capital Ratio	Times	1.3	2.0
12	Fixed Assets Turnover Ratio	Times	4.4	4.5
13	Inventory Turnover Ratio	Times	6.0	6.4
14	Debtors Turnover Ratio	Times	29.4	29.8
15	Days Sales Outstanding (DSO)	Days	12	12
16	Interest Coverage Ratio	Times	13.49	56.82

SEGMENT REVIEW AND ANALYSIS

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision

Maker (CODM). The Chief Executive Officer (CEO) and Managing Director (MD) of the Company has been identified as CODM

who assesses the financial performance and position of the

Company and makes strategic decisions.

The Companys CODM has identified one business segment viz. Manufacturing and Sales of Cement and its only production facility is located in India. There are no other reportable segments.

COST AND PROFITABILITY

Your Company constantly strives to keep costs under control. The Company focuses on cost reduction by sourcing procurement, increasing power from green energy, which is both eco-friendly and cheaper, using alternative fuel, improving logistics operations, controlling overheads including manpower and expanding sales & marketing presence to enhance the overall performance and profitability of the Company.

OPPORTUNITIES, THREATS, RISK & CONCERN

The Company has well defined structure that allows and enables management to recognize, evaluate and exploit business opportunities and manage risk exposure in the organization effectively.

As per Risk Management framework and procedures, management deal with various types of risks and take suitable actions for its mitigation. For example, for higher priority risks, the Company has developed and implemented specific risk management plans that help management in strategic decisions and funding considerations, if any. Lower priority risks are also monitored as per plan. Company has the process of communication, consultation, monitoring and periodical & regular review of the risks and effectiveness of the mitigation plan.

Raw material risk

The cement industry mainly relies on limestone as primary raw material and other raw materials are the main inputs for the cement industry. However, nearby sources of limestone are scarce and therefore, it is important to encourage the use of blended cement, which uses other raw materials such as fly ash and slag. The rise in the price and availability of these other materials may also raise the costs of production.

Sales and Marketing Risk

Fragmented markets, rapid capacity additions by competitors, limited distribution networks, and changing industry preferences pose sales and marketing risks. We address these risks through benchmarking analysis, proactive market positioning, and developing innovative products for niche markets.

Compliance Risk (Legal Risk)

With the constantly evolving regulatory framework, there is a risk of non-compliance with legal requirements, which can lead to fines and charges. We have established committees to create employee awareness and mitigate compliance risks effectively.

Climate Change Risk

We are committed to adopting sustainable practices as a socially and environmentally responsible company. Our philosophy of ‘Clean and Green is Profitable and Sustainable guides our operations, making us a powerful and distinctive brand. We have subscribed to stringent voluntary emissions reduction programmes to address climate change risks proactively.

Human Resource Risk (Talent Management Risk)

Our critical challenges include retaining talent and ensuring the right people are in the right roles. We mitigate talent management risks by providing specialised training courses to enhance and reskill employees, thus creating a talent pipeline for future roles.

Financial Risk

We face risks from changes in interest rates, foreign exchange rates, and commodity prices. We use a suitable policy to reduce these risks and check and report on them regularly.

Infrastructure Risk

Infrastructure sector drives overall development of the economy and is a major focus of the Government of India. Any pullback by the government on its initiatives will result in de-growth for the cement industry. Moreover, too many regulatory approvals and compliances might be a hindrance to the segments progress.

Power, fuel and freight risk

There has been considerable fluctuation in fuel prices in the international markets, which has been accompanied by high volatility and uncertainty in shipping costs. These issues create difficulties for the availability and pricing of coal for the cement industry and the Company.

During the year, the Company used coal for about 95% of its kiln fire needs. Therefore, any increase in international coal prices will negatively affect the operating costs of the Company. The cement industry consumes a lot of energy and about 36% of its total spending goes to power and fuel costs. Out of 36% of power and fuel cost, about 10.38% of the cost is for power. However, the Company strives to constantly focus on green energy with lower sourcing costs and becoming a self-reliant Company in the current energy situation. During the year, the Company consumed 44.75% of its total power requirement from Green Energy Sources like Wind and WHRS. We use railways and sea for limited dispatches. Majority of Companys dispatches are through road. Increase in Diesel prices may make road transportation more expensive. The chance of crude oil prices going up and the instability in the global market and our big reliance on road transportation may hurt our operating costs.

Cyber Security Threats

Technology has changed rapidly in recent years, and so have the risks associated with it. The spread of business data from data centers to the cloud, social media and digital platforms for B2B and B2C interactions are affecting cyber security.

Besides data loss, cyber-attacks can harm business operations, equipment and human resources, and lead to legal and regulatory responsibilities.

Suitable controls (technology and governance) are being designed and executed.

Strategies

The Company has followed two strategies. First is a short-term strategy, aimed at health, cost and cash to mitigate immediate risks. We focused on ensuring the health and safety of our employees, suppliers and channel partners, while initiating stringent measures to control costs and strengthen cash flows. Secondly, long-term strategies include increasing our market reach through capacity expansion, launch of more innovative and superior quality products; enhance efficiencythrough digital transformation,costoptimization efficiency;and logistics achieve our sustainability goals through our targeted initiatives across four pillars of our sustainable development plan. The Company successfully integrated its environmental, social and governance (ESG) plans and targets across all functions and continue to give top priority to improve upon in all ESG parameters.

DIGITALISATION AND INNOVATION

We firmly believe digitalisation is a crucial driver of sustainable business growth. Over the past few years, the Company has embraced digital technologies across its core business processes, including sales, logistics, materials management, manufacturing, control systems and technology operations. The

Companys well defined digital transformation strategy aims to streamline business processes and optimise resource usage to achieve sustainable business growth while complying with regulatory requirements.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company follows a proper and adequate system of internal controls in respect of all its activities including safeguarding and protecting its assets against loss from unauthorized use of disposition. Further, all transactions entered into by the Company are duly authorized and recorded correctly. M/s RSM Astute Consulting Group (RSM), Chartered Accountant has been working as the Internal Auditor of the Company for FY 2024-25.

The Internal Auditors are submitting reports to the Company on a Quarterly basis.

INTERNAL CONTROLS OVER FINANCIAL REPORTING (ICFR)

The internal financial controls within the Company are commensurate with the size, scale and complexity of its operations. The controls were tested during the year and no reportable material weaknesses either in their design or operations were observed. The Company has robust policies and procedures which, inter alia, ensure integrity in conducting its business, the safeguarding of its assets, timely preparation of reliable financial information, accuracy and completeness in maintaining accounting records and the prevention and detection of frauds and errors. The operating effectiveness of such controls are in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting ("the

Guidance Note") and the Standards on Auditing specified by the

Central Government in accordance with Section 143(10) of the 2013 Act and other authoritative pronouncements, to the extent applicable to an audit of internal financial controls over financial reporting, both issued by the ICAI.

HUMAN RESOURCE DEVELOPMENT / INDUSTRIAL RELATIONS

The Company continued with efforts to ensure that its pool of human resources is "future ready" through its robust processes of learning & development, capability building and its development programmes. Efforts were taken to develop leadership lines as well as to enhance technical and functional capabilities with special focus on nurturing young talent, in order to face future challenges that may arise. The Company organized several training, awareness and coaching programs to develop the leadership, technical and management skills of employees. Employee engagement programs were organized to create openness and sharing ideas by employees. This learning journey includes formal, informal and highly interactive components that would help in honing their leadership, and coaching skills. It will ensure that the development initiatives result not just in better skills but in enhanced performance and higher engagement. As of 31^st March,, 2025, the Company had 241 employees in its payroll (The number as of 31^st March, 2024 was 245). Industrial relations during the year under report remained cordial.

EDUCATION

The Company has been providing primary/secondary education for the children of the employees and local community staying in nearby areas of Factory / Mines. The Company has provided educational kits to needy children in the nearby villages. More details on this are covered in the Annual Report on CSR activities forming part of the Directors Report.

ENVIRONMENT, SUSTAINABILITY AND GOVERNANCE

The Company has been continuously contributing towards environmental sustainability. Continuous improvement, enhanced process efficiency and periodic capital expenditures have helped us position "KAMAL" Cement one of the most responsible cement manufacturers in the country. The Company has been periodically reviewing the criteria of Environment, Sustainability & Governance (ESG) as per its ESG Policy with a focus on continuous improvement in Environment Sustainability. During the year, the Companys efforts continued with the same rigour. It conducted its business maintaining high standards of governance, respecting nature and demonstrating social responsiveness towards its communities & people.

Under its ESG Implementation plan, the Company has identified

14 key areas viz. water management, circular economy & waste management, energy & climate change, atmospheric emissions, biodiversity management & greenbelt development, sustainable mining, product quality management, health & safety, transparency, ethical practices & corporate governance, innovations & digitalization, sales & supply chain, human resources, community engagement and corporate social responsibility under which key initiatives are undertaken. Despite a challenging year 2024-25, we were able to achieve considerable improvements across the targets and are on track with the agenda of the Company.

More details on the Companys ESG initiative and performance during the year are annexed to this MDA and BRSR forming an integral part of the Annual Report.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be "forward looking statements" within the meaning of applicable laws or regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include global and domestic demand- supply conditions finished goods prices, raw materials costs and availability, fluctuations in exchange rates, changes in Government regulations, tax laws, natural calamities litigation and industrial relations, monsoon, economic developments within the country and other factors.

For and on behalf of the Board of Directors
Anil Singhvi	R. Krishnakumar
Executive Chairman	CEO & Managing Director
Place: Mumbai / Digvijaygram
Date: 28th April, 2025

Water Management

During the year, specificwater consumption increased marginaly, despite the Grinding Unit expansion project and the associated rise in consumption. Improvement in water consumption is further likely to be driven by continuous efforts to promote water sensitivity among employees and their families, as well as by optimizing our manufacturing processes. All water introduced into the process is recovered as return water and reused. Our organization is designed to operate as a Zero Liquid Discharge (ZLD) facility.

Overall, specific water intensity rose from 0.137 KL/t cement

0.138 KL/t cement in 2024–25.

Additionally, treated wastewater from our Sewage Treatment Plant (STP) is effectively utilized for activities such as greenbelt development and dust suppression, further reinforcing our sustainable water management practices.

Water collected in artificial recharge structures not only helps replenish the areas groundwater table but also significantly contributes to enhancing regional biodiversity.

Sales & Supply Chain

The Company maintained its strategic focus on expanding the share of blended cement within its total cement production. In the reporting year, blended cement comprised 49.50% of the Companys overall output. These efforts contributed to a continued reduction in the average clinker factor across the entire cement portfolio, supporting both operational efficiency and sustainability goals.

Energy and Climate Change

During 2024–25, the Companys Waste Heat Recovery System ( WHRS ) generated a net total of 251.10 lakh units of electrical energy. In addition, 226.24 lakh units of wind and hybrid (wind and solar) power were sourced and consumed through Power Purchase Agreements (PPAs).

As a result, the Company consumed a total of 477.34 lakh units of green energy during the year 24-25, accounting for 44.75% of its overall electricity consumption. This reflects the Companys commitment to sustainable growth and its ongoing focus on expanding green energy generation. The Company is also activelyexploringnewopportunitiesfortie-upswithgreenenergy providers to further strengthen its renewable energy portfolio.

Circular Economy, Waste Management and Resource Conservation Throughoursystematicapproachtocirculareconomyprinciples, we utilized various types of waste in our operations with the aim of "wasting nothing." In the reporting year, we co-processed 7,472.62 MT of alternative fuel in our Kiln. Additionally, we have consumed 34908 MT hazardous waste like Chemical Gypsum, etc. as raw materials in cement production. Similarly, we utilized 211,179 MT of fly ash in cement manufacturing during 2024–25. Dust collected from pollution control equipment at our cement plants is recycled and re-utilized within the respective production circuits, becoming part of the final product in each section.

In line with our commitment to sustainability and the circular economy, we also co-processed 6122.11 MT of plastic waste under the Extended Producer Responsibility (EPR) initiative.

Atmospheric Emissions

During FY 2024 25, the Company achieved a significant reduction in greenhouse gas (GHG) emissions, lowering its

overall emission intensity from 674 kg CO2^{/ton cement to 636 kg CO}2^{/ton cement, despite challenges related to fuel quality and}

price fluctuations.

Stack emissions were consistently maintained below the stipulated limit of <30 mg/Nm?. Continuous measures such as tree plantation & water sprinkling are being implemented to minimize fugitive emissions and enhance the plants green cover.

In addition to existing raw material and coal storage sheds, several infrastructure and environmental improvement projects were undertaken, including:

Our raw Coal Conveying system was modified to save power consumption hence indirectly affecting scope 2 emissions

modification of cement mill bag filter and material conveying circuit to optimize the process and power consumption. with a capital investment of 1.95 Cr. Regular dust suppression through tankers is done within and surrounding the area of the plant to decrease the intensity of fugitive emission. Annual maintenance of all 3 major Baghouses

& ESP is done to increase the efficiency, thereby decreasing the emissions from stacks.

To control NOx emissions, the Company continued implementation of primary and secondary reduction techniques, including Selective Non-Catalytic Reduction (SNCR) systems at integrated plants.

The specific NOx emissions has incresed from 340 mg/Nm3 to

410 mg/Nm? in FY 2024–25 mainly due changes in fuel quality to maintain the overall fuel cost economics. However, they are much beyond the stipulated limit of < 600 mg / Nm³.

SOx emissions remained well within regulatory limits and did not necessitate additional abatement measures. Specific SOx emissions decreased to 17.9 mg/Nm? in FY 2024–25 from 42 mg/Nm? in the previous year mainly due to reduction in S content fuel like Petcoke.

The Company ensures real-time online monitoring and reporting of ambient air quality, effluent parameters, and stack emissions as per regulatory requirements. Continuous monitoring of key parameters—including dust, NOx, SOx, dioxin & furans and ambient air quality indicators

(PM10^{, PM}2^.5^{, SO}2^{, NOx, CO, and O}2^{)—is carried out at the Sikka plant to ensure full compliance}

and transparency

Biodiversity management and greenbelt development

To actively contribute to environmental protection and ecological balance, our Company is deeply committed to preserving the environment and promoting biodiversity, both of which are vital for sustaining healthy ecosystems. These efforts also enhance the aesthetic value of our operational areas, including mines and residential zones.

To support these goals, a well-planned green belt has been developed across our plant premises, mining areas, and surrounding regions. During the year, we planted more than 20,000 trees, bringing the cumulative total to approximately 3,60,000, with a survival rate exceeding 80% within plant, colony, mines and nearby premises.

Our Plant and Mines teams have launched notable initiatives to conserve and propagate rare and native species, including medicinal (Ayurvedic) plants. These efforts have increased forest cover and led to the creation of fruit gardens. Plantation species include Neem, Peepal, Yellow Gulmohar, Sapodilla (Chikoo), Mango, Ashoka, and Amaltas, among others.

To further strengthen biodiversity across our operational zones, the Company has proactively introduced a Comprehensive Action Plan on Biodiversity (CAPB). This plan outlines a clear vision for conserving existing habitats, implementing targeted ecological enhancements, and establishing robust mechanisms for effective execution and monitoring.

Sustainable Mining

Mining is a key operational activity at SDCCL, undertaken to source limestone—our primary and essential raw material. We operateinasecludedandchallengingenvironmentcharacterized by undulating topography. Recognizing the ecological sensitivity of mining, we are committed to minimizing environmental disturbance through responsible and sustainable practices. The mines at SDCCL are fully mechanized, utilizing a combination of ripper-dozer, excavator, and tipper for opencast mining. All operations are conducted in an eco-friendly manner, strictly adheringtotheapprovedminingplan.Notably,ourminingprocess is carried out without drilling and blasting, thereby avoiding pollution typically associated with such methods—including dust, noise, vibrations, and other emissions. Additionally, no solid waste is generated from the mining process.

We follow a multi-pit mining approach to blend low-grade and high-grade limestone, ensuring optimal utilization of mineral resources. Excavated limestone is transported in tarpaulin-covered trucks to minimize dust emissions during transit.

As part of our Progressive Mine Closure Plan, we actively reclaim matured pits and non-mineralized zones. Mining activities are strictly confined to areas above the groundwater table, and no dewatering is carried out from mining pits.

During the reporting year, we planted approximately 5,000 saplings across our mining areas. To date, we have undertaken plantation activities over 43.10 hectares and converted 30.88 hectaresintowaterreservoirs,whichplayavitalroleinrecharging the surrounding groundwater table.

Product Quality Management

Quality control is a vital component of cement production, ensuring consistency, reliability, and optimal performance. At Digvijay Cement, Product Quality Management (PQM) is dedicated to delivering "assured quality" across the entire product range. PQM integrates a comprehensive suite of tools and methodologies to systematically monitor, control, and enhance both the quality and strength of cement throughout the manufacturing process.

Health and Safety

Health and Safety remain a foundational pillar of the Companys governance framework. Digvijay Cement has reinforced frontline engagement and leadership involvement through regular interactions with shop-floor personnel, embedding safety as a core value and way of life.

Routine safety audits conducted by both internal teams and external agencies ensure regulatory compliance and drive continuous improvement. Robust systems such as the Permit to Work for high-risk activities and the structured reporting of

Unsafe Acts and Conditions are firmly in place. Mock drills are regularly organized to strengthen emergency preparedness across the organization.

The Company places strong emphasis on awareness and capacity-building through ongoing Environment, Health, and Safety (EHS) training programs. Signature events like National Safety Week, Global Safety Day, and World Environment Day are celebrated with active participation from employees, local schools, and surrounding communities.

To foster a culture of ownership and accountability, a monthly reward program recognizes both direct and indirect employees for exemplary contributions to workplace safety.

Ethical Practices and Corporate Governance believesThe Company that businessfirmly ethics and profitability of any organization. As a responsible corporate citizen, it is committed to sound governance practices rooted in conscience, transparency, fairness, professionalism, and accountability—building stakeholder trust and paving the way for enduring success.

The Company conducts its affairs with integrity, placing the highest importance on ethical decision-making, transparent processes, and environmentally responsible operations. These principles are reflected in its Vision, Values, Code of Conduct, and supporting policies.

Dedicated to creating long-term sustainable value for all stakeholders, the Company regularly organizes training sessions and awareness programs for employees and other stakeholders. These initiatives foster a deeper understanding of ethical principles and equip participants to navigate complex and conflicting situations with integrity.

Further details on the Companys philosophy and practices related to corporate governance are provided in the Corporate Governance Report, which forms an integral part of the Annual Report.

Innovation and Digitization

Digitization provides valuable insights into the efficiency and performance of the cement manufacturing process. Capturing operational data in real time is essential for optimizing performance and improving equipment availability.

At Digvijay Cement, the implementation of advanced Distributed Control Systems (DCS) and other digital tools enables precise adjustment and optimization of operating parameters. These technologies allow us to identify potential issues before they escalate, ensuring proactive maintenance and operational continuity.

Additionally, our digital infrastructure supports remote diagnostics, troubleshooting, and performance adjustments, enhancing responsiveness and reducing downtime. These innovations are key to driving smarter, more efficient, and more resilient manufacturing operations.

Community engagement and Corporate Social Responsibilities

We are a customer-centric organization which takes pride in collaborating with all our customers, from channel partners to the end consumer, in order to better understand their requirements. We conduct regular customer satisfaction surveys which allow our customers to share their valuable feedback with us. Training programmes are conducted for engineers, channel partners, builders and contractors. We organise visits to our manufacturing plant as a part of this initiative. We connect closely with communities around our manufacturing facility and look for opportunities to support them to become more self- out to sufficient. communities.

Details about CSR activities is included in the Directors Report, forming integral part of Annual Report.

The Company is committed to achieve and comply with sustainable development goals. For this purpose, the

Company has defined plans and strategies for the successful implementation and monitoring of the agenda.