Shri Keshav Director Discussions


To,

The Members,

The Directors have a pleasure in presenting you the 30th Annual Report on the business and operations of the Company along with Audited Financials for the year ended as on 31st March, 2023.

1. Financial Results:

Financial Results of the Company for the year under review along with the figures for previous year are as follows:

[In Lakhs]

Particulars For the Year ended on 31st March,2023 For the Year ended on 31st March,2022
Revenue from Operations 12323.94 11379.07
Other Income 212.67 230.25
Total Income 12536.60 11609.32
Less: Expenses 11932.25 10863.81
Profit before Exceptional items & Tax 604.35 745.52
Add: Exceptional items - -
Less: Tax Expense
1. Current Tax 66.89 124.13
2. Deferred Tax 430.28 -288.94
3. Provision for Tax previous year - -
4. MAT Credit reversal of previous year - -
5. Unused Tax -183.57 -
Credit
Profit for the period from continuing operation 290.75 910.33
Profit/(loss) from discontinued operations - -
Profit/(Loss) for the period 290.75 910.33
Total other comprehensive income, net of tax 2.57 -5.91
Total comprehensive income, for the period 293.32 904.42
Earnings per share (Basic) 2.45 7.54
Earnings per share (Diluted) 2.11 7.54

2. State of Affairs of the Company:

The Company is principally engaged in the business of manufacturing of cement of different grades and is marketing its product under the brand name

"Keshav Cement" and "Jyoti Cement" and has also diversified its business in Green Energy through Solar Power Generation. All of these business activities are carried out by the Company majorly in the Northern Parts of Karnataka.

Gross Turnover of Company:

During the financial year 2022-

23, the Companys gross turnover has increased by 8.30% to Rs. 12,323.94 Lacs as compared to Rs. 11,379.07 Lacs in previous year.

Profit after Tax:

The company for continuous 2nd year has earned profits. During the financial year 2022-23, the company has earned pre-tax profit of Rs. 604.35 Lakhs & Net profit of Rs. 290.75 Lakhs. The Directors are confident of achieving continuous progress in sales and profit in the years to come.

The business performance of the Company has been discussed in detail in the Management

Discussion and Analysis Report attached separately as Annexure I and forming part of this report and the Financial Statements are also attached separately forming part of this Report.

3. Dividend:

The Board of Directors of the Company, after considering the financial and non-financial factors prevailing during the financial year 2022-23 and the continuous expansion activities carried/proposed to be carried out by the company, have decided to retain the profits in the company and therefore, no dividend is recommended for the financial year 2022-23.

4. Transfer of unpaid and unclaimed amount to IEPF:

Pursuant to the provisions of Section 124(5) of the Companies Act, 2013, dividend and Refund of share application money due for refund which remains unpaid or unclaimed for a period of seven years from the date of its transfer to unpaid/unclaimed amount is required to be transferred by the company to Investor Education and Protection Fund (IEPF), established by the Central Govt. under the provisions of Section 125 of the Companies Act, 2013. During FY 2022-23, the company was not required to transfer any amount from its Unpaid Dividend Account to the Investor Education and Protection Fund (IEPF).

5. Reserves:

The Company does not propose to transfer any amount to the General Reserves for the FY 2022-23.

6. Share Capital:

During the year under review, the Authorized Equity Share Capital of the Company as on 31st March, 2023 was Rs. 12,00,00,000/- and the Paid-up Equity Share Capital was Rs. 11,99,57,520/-.

A. Buy Back of Securities.

The Company has not bought back any of its securities during the year under review.

B. Details of issue of Sweat Equity Shares.

The Company has not issued any Sweat Equity Shares during the year under review.

C. Disclosure in respect of voting rights not exercised directly by the employees in respect of shares to which the scheme relates.

There are no such cases arisen during the year under review.

D. Details of Issue of Equity Shares with Differential Rights.

The Company has not issued any Equity Shares with differential rights during the year under review.

E. Bonus Shares.

No Bonus Shares were issued during the year under review.

F. Employees Stock Option Plan. The Company has not issued any stock options during the year under review.

G. Details of Rights issue.

During the year under review, the company has not issued any rights issue.

7. Finance:

Cash and cash equivalent as at 31st March, 2023 was Rs. 845.61 Lakhs. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.

8. Change in the nature of business, if any:

There is no change in the nature of the business of the Company during the year.

Material changes and commitments, if any, affecting the financial position of the company which has occurred between the end of the financial year of the company to which the financial statements relate and the date of the report:

The significant and material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report are viz.,

Preferential Issue: The company has made a Preferential Issue of shares to the Promotes/Promoter group and to specified investors after receiving approval from the shareholders in the ExtraOrdinary General Meeting held on 12/04/2023.

Brief details of the allotment: a) Issued 19,20,000 Equity Shares at a price of Rs. 125/- to the Promoters / Promoter Group against conversion of

Unsecured Loan of Rs. 24.00 Crores. b) Issued 15,72,000 Equity Shares at a price of Rs. 125/- to Specified Investors amounting to Rs. 19.65 Crores. c) Issued 20,25,000 Equity Share Warrants at a price of Rs. 130/- to Specified Investors amounting to Rs. 26.33 Crores.

Pursuant to Regulation 32 (7A) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Board hereby confirms that as per the latest quarter i.e. 30/06/2023, there is no deviation or variation in the utilization of the proceeds of the preferential issue and the details of the utilization of funds is provided below:

Original Original Funds
Object allocation Utilized
Support for Rs. Rs.
Day-to-Day 24.00 24.00
Operations Crores Crores
& Working
Capital
Needs
Capital Rs. Rs.
Expenditure 45.975 10.574
for Crores Crores
Expansion
of its Plant/
Factory
Modified Object, if any NIL
Modified allocation, if NIL
any
Amount of Deviation/ NIL
Variation

9. Details of Subsidiary/Joint Ventures/Associate Companies:

The Company does not have any Subsidiaries/Joint Ventures/ Associate Companies.

10. Details in respect of frauds reported by auditors under subsection (12) of section 143 other than those which are reportable to the Central Government:

The Auditors have not reported any matter under Section 143(12) of the Companies Act, 2013.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review

11. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future:

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

12. Details of adequacy of internal financial controls with reference to the Financial Statements:

Your Company has deployed adequate Internal Control Systems, in the place to ensure a smooth functioning of its business. The processes and systems are reviewed constantly and improved upon to meet the changing business environment. The Control Systems provide a reasonable assurance of recording the transactions of its operations in all material aspects and of providing protection against misuse or loss of Companys assets. The Internal

Auditors periodically reviews the internal control systems, policies and procedures for their adequacy, effectiveness and continuous operation for addressing risk management and mitigation strategies.

13. Particulars of Loans, Guarantees or Investments:

There are no Loans, Guarantees and Investments covered under Section 186 of the Companies Act, 2013.

14. Performance and financial position of each of the subsidiaries, associates and joint venture companies included in the consolidated financial statement:

Disclosure under this head is not applicable as the Company does not have any Subsidiaries / Associate Companies / Joint Venture Companies.

15. Vigil Mechanism / Whistle

Blower Policy:

Pursuant to the provision of Section 177(9) of the Companies Act, 2013 the Company had established a vigil mechanism for directors and employees to report concern of unethical behavior, actual or suspected fraud or violation of the Companys code of conduct.

The Company has a vigil mechanism in place through its Whistle Blower Policy, which provides a platform to disclose information without fear of reprisal or victimization, where there is reason to believe that there has been serious malpractice, fraud, impropriety, abuse or wrong doing within the Company. The detail of the Whistle Blower Policy is also posted on the website of the Company.

16. Disclosure as required under

Section 22 of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace and matters connected therewith or incidental thereto covering all the aspects as contained under the "The Sexual

Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013". The following is a summary of sexual harassment complaints received and disposed of during the financial year ending March 31, 2023:

Number of complaints received: NIL Number of complaints disposed of: NIL

17. Development & Implementation of Risk Management Policy:

The Company has developed and implemented the Risk Management Policy. The objective of this policy is to ensure sustainable business growth with stability promote a pro-active approach in reporting, evaluating and resolving risks associated with the business, establish a framework for the companys risk management process and to ensure its implementation, enable compliance with appropriate regulations through the adoption of best practice and to assure business growth with financial stability.

18. Familiarization Programme:

The Company has put in place an induction and familiarization programme for all its directors including the Independent Directors. The familiarization programme for Independent Directors in terms of provisions of Regulation 46(2)(i) of Listing Regulations, is uploaded on the website of the Company:- www.keshavcement.com.

19. Board Meetings:

During the Financial Year 2022-23, 6 (Six) Board Meetings, 4 (Four) Audit Committee Meetings,

3 (Three) Nomination & Remuneration Committee Meetings and 4 (Four) Stakeholder Relationship Committee Meetings were convened and held. The details of the same are given under the Corporate Governance Report forming part of this Report.

20. Public Deposits:

Your Company has not accepted any deposits from the public during the financial year under review.

21. Extract of the Annual Return:

Pursuant to Section 92(3) of the Companies Act, 2013, and Rule 12(1) of the Companies (Management and Administration) Rules 2014, an Extract of Annual Report in Form MGT-9 is available on the Companys website at www.keshavcement.com.

22. Related Party Transactions:

The Company has in place formulated a Policy on materiality of Related Party transactions for dealing with such transactions in line with the requirements of the Listing Regulations with the Stock Exchange. The Policy on related party transactions is available on the Companys website at www.keshavcement.com

Particulars of Contracts or Arrangements with related parties referred to Section 188(1) of the Companies Act, 2013 in specified in Form AOC-2 which forms part of this report as "Annexure- II"

23. Directors Responsibility

Statement:

In pursuance of Section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, confirm that:

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

(b) The directors 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 profit and loss of the company for that period;

(c) 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;

(d) The directors have prepared the annual accounts on a going concern basis; and

(e) The directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

Explanation: For the purposes of this clause, the term

"internal financial controls" means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information;

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

24. Directors and Key Managerial

Personnel and Formal Annual Evaluation:

(a) The details of Directors & KMPs who were appointed or resigned during the financial year under review:

During the period under review, Mr. Balasaheb Mestri and Mrs. Radhika Dewani whose term as an Independent Director expired on 11/08/2022 and 11/12/2022 respectively were reappointed for another period of 5 years by the shareholders in the 29th Annual General Meeting of the company held on 10th August, 2022 and they shall continue to hold the office of Independent Director of the company till 11/08/2027 and 11/12/2027 respectively.

(b) Independent Directors:

The Company has received declarations from the Independent Directors of the Company stating that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 and the Regulation 16(1)(B) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

(c) Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligation and Disclosure requirements) Regulations 2015, the Board has carried out an annual performance evaluation of its own performance and the performance of the individual Directors as well as the evaluation of the working of its Committees. The manner in which the evaluation was carried out has been explained in the Corporate Governance Report.

(d) Disclosure on Re-appointment of Independent Director(s):

During the Financial Year, 2022-23, Mr. Balasaheb Mestri and Mrs. Radhika Dewani whose term as an Independent Director expired on 11/08/2022 and 11/12/2022 respectively were reappointed for another period of 5 years by the shareholders in the 29th Annual General Meeting of the company held on 10th August, 2022 and they shall continue to hold the office of Independent Director of the company till 11/08/2027 and 11/12/2027 respectively.

(e) Opinion of Board with regards to integrity, proficiency of Independent Directors

50% of the composition of the Board of the company consists of Independent Directors. The Independent Directors appointed are having wide experience and knowledge in the various fields and they help the Board in providing an edge and give an outside perspective to the Company. All the Independent Directors have registered their names in the Independent Directors Data Bank and have also cleared the online proficiency self-assessment test conducted by the Institute notified under sub-section (1) of Section 150.

25. Statutory Auditors:

At the 29th Annual General Meeting of the Company held on 10th August, 2022 the shareholders had approved the reappointment of M/s. Singhi & Co., as the Statutory Auditors of the Company for the period of five consecutive years from the conclusion of 29th Annual General Meeting till the conclusion of 34th Annual General Meeting with respect to the Financial Years 2022-23 to 2026-27 (both inclusive) for audit of Financial statements of the company and at a remuneration to be decided by the Audit Committee of the Board of Directors in consultation with the Auditor.

26. Audit Report

The Auditors of the company have issued qualified Audit Report for the FY 2022-23. The Qualification is with respect to: a) GST Compensation Cess & b) GST investigation by DGGI (both matters are more specifically described in the Audit Report annexed hereto)

Boards explanation on the

Qualification a) GST Compensation Cess: The Management believes that Input Compensation Cess of Rs. 242.57 lakhs will remain unutilised in the books currently. However, management is planning to venture into cement products and exports in future. As cess is applicable to certain cement products, the Input Compensation Cess can be adjusted towards the sale of such Cement Products and/or refunded in case of exports. Hence the management believes that this unutilized cess is recoverable in the near future.

b) GST investigation by DGGI: The management has paid the amount of Rs. 641.52 lakhs and Rs. 218.11 Lakhs towards GST and interest in the year 2020 & 2021 towards GST search regarding the FY19 and FY20. To cooperate with the department, the full amount was paid under protest. To date the investigation is not completed and based on available records, the management believes that the amount will be refunded.

27. Secretarial Audit:

In terms of Section 204 of the Companies Act, 2013, the

Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and on the recommendation of the Audit Committee, the Board of Directors of the Company has re-appointed M/s. Akshay Jadhav & Associates, Practicing Company Secretaries, as Secretarial Auditor of the Company for the financial year 2022-23. Secretarial Audit Report as provided by M/s. Akshay Jadhav & Associates, Practicing Company Secretaries is also annexed to this Report, in the prescribed Form MR-3, as

"Annexure-III". The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimer. The report is self-explanatory and therefore do not call for any further comments.

28. Cost Audit:

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost records maintained by the Company in respect of its manufacturing activity are required to be audited. Your Directors on the recommendation of the Audit Committee, reappointed M/s. Santosh Kalburgi

& Co., Cost Accountants, as Cost Auditors of the Company for the financial year 2023-24.

M/s. Santosh Kalburgi & Co., Cost Accountants confirmed eligibility to be re-appointed as the Cost Auditor of the company and expressed his willingness to be reappointed for the financial year 2023-24. The Board of Directors has re-appointed M/s. Santosh Kalburgi & Co., Cost Accountants as the cost auditors of the Company for the financial year 2023-24 at remuneration of Rs. 60,000/- subject to ratification of his remuneration by shareholders in the ensuing Annual General Meeting of the Company. As required under the Act, the remuneration payable to cost auditors has to be placed before the Members at general meeting for ratification. Hence, a resolution for the same forms part of the Notice of the ensuing AGM.

The Audit Committee has also received a Certificate from the Cost Auditor certifying their independence and arms length relationship with the Company.

29. Nomination and Remuneration

Committee and Stakeholders Relationship Committee:

The present composition of the Nomination and Remuneration Committee includes Mr. Krishnaji Patil Chairman, Mr. Balasaheb A Mestri, and Mr. Venkatesh Katwa as its members. The Nomination and Remuneration committee has framed a policy for selection and appointment of Directors including determining qualifications of Independent Director, Key Managerial Personnel, Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013. The policy is made available on the website of the company i.e. www.keshavcement.com.

The Stakeholders Relationship Committee comprises of Mr. Krishnaji Patil, Chairman, Mr. Balasaheb A. Mestri and

Mrs. Radhika Pinal Dewani as its members.

30. Corporate Social Responsibility

(CSR):

Pursuant to Section 198 of the Companies Act, 2013, the Average Net Profit of the Company for last three financial years was negative. Even though the company was within the purview of Section 135 of the Companies Act, 2013, the company was not required to spend any amount on CSR activities during the FY 2022-23 and was not required to constitute a Corporate Social Responsibility Committee. The report on the CSR activities is appended as

" Annexure V" to the Boards

Report.

31. Particulars of Employees:

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is attached as "Annexure IV". In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the complete information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

32. Corporate Governance:

In compliance with Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Corporate Governance Report for the Financial Year 2022-23 as required under SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015 of the Company is attached herewith and marked as "Annexure-VII" forms part of this Report. The requisite certificate(s) along with certificate from M/s. Akshay Jadhav & Associates, Practicing Company Secretaries, confirming compliance with the conditions of Corporate Governance and from Company Secretary in practice that none of the Directors of the Company have been debarred or disqualified from being appointed or continuing as Directors of the Company by Securities and Exchange Board of India/ Ministry of Corporate Affairs or any such authority is attached to the Corporate Governance Report.

33. Audit Committee:

The Audit committee comprises of Mr. Krishnaji Patil as Chairman, Mr. Balasaheb Mestri, Mrs. Radhika Dewani and Mr. Venkatesh H. Katwa as its members.

The committee met 4 times during the Financial Year under review and all the recommendations of the Committee were accepted by the Board.

34. Conservation of Energy,

Technology Absorption, 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

VI".

35. Details of application pending under Insolvency and Bankruptcy Code, 2016:

During the financial year there has been no application made or proceeding pending in the knowledge of the company under the Insolvency and Bankruptcy Code, 2016.

36. Details of one time settlement with banks or financial institutions:

During the financial year there is no instance of one-time settlement entered by the company with banks or financial institutions and hence no question of providing the differential amount between the valuation done at the time of onetime settlement and the valuation done while taking loan from the banks or financial institutions.

37. Acknowledgements:

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

Cautionary Statement:

Statements in the Boards Report and the Management Discussion &

Analysis describing the Companys objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

For and on behalf of the Board of Directors of

SHRI KESHAV CEMENTS AND INFRA LIMITED

Sd/-

Venkatesh Katwa Chairman

Date: 01/08/2023

Place: Belgaum