Star Paper Mills Ltd Directors Report

Dear Shareholders,

The Board of Directors of the company is pleased to present the Directors Report together with Audited Financial Results of your company for the financial year ended on 31^st March 2024.

1. FINANCIAL HIGHLIGHTS

Audited financial results for the financial year ended on31^st March, 2024 are summarised below:

AUDITED FINANCIAL RESULTS

( in Crores)

Particulars	FY ended 31st March, 2024	FY ended 31st March, 2023
Profit before interest and depreciation	88.98	101.43
Interest and finance charges	0.84	0.56
Depreciation	5.44	5.28
Profit before Exceptional Items	82.70	95.60
Exceptional & non-recurring items	(1.80)	(12.26)
Profit before tax	80.90	83.34
Provision for Income Tax	16.90	17.67
Profit after tax (PAT)	64.00	65.67
Earning per share (EPS)- in Rupees	41.01	42.08

2. DIVIDEND & TRANSFER TO RESERVES

Considering the financial performance of the company for the financial year 2023-24 and the current scenario of the Industry, the Board of Directors is pleased to recommend a dividend of Rs. 4/- per equity share (40%) of Rs. 10/- each for the year ended 31^st March. 2024 subject to approval of the Shareholders at the ensuing Annual General Meeting.

The company has not transferred any amount of profits for the year to General Reserve.

3. STATE OF THE COMPANY AFFAIRS

Review of performance for the year 2023-24:

The year 2023-24 witnessed sluggish product demand and intense market competition especially from imports. Global Pulp and Paper Prices ruled lower than previous year leading to decline in domestic realisations too.

At the same time Wood prices surged due to demand from construction and other sectors leading to higher Input costs.

However, reduction in coal prices provided some respite.

There was an incidence of fire in one of the Wood Yards (outside Mills compound) in Dec., 2023 The loss of wood due to fire is covered under Insurance and claim has been lodged. There was no human casualty due to above accident.

Amid various challenges and fierce competition, your company reported a Profit after tax (PAT) of Rs. 64.00 Crores for the year 2023-24 as against Rs. 65.67 Crores for FY 2022-23.

There have been no material changes and/or commitments affecting the financial position of the company since the close of financial year till date of this report. Further, there is no change in nature of business of the company during the year under review.

Expectations for the year 2024-25:

Pressure on margins due to intense competition on demand side and rising wood prices is expected to persist for some time. However, going forward volume growth is expected in line with a buoyant Economy.

4. ANNUAL- RETURN EXTRACTS

Pursuant to Section 134(3)(m) of the Companies Act, 2013, Annual Return in the prescribed format is available at https:// starpapers.com/pdf/ann_return_2324.pdf

5. BOARD MEETINGS/AUDIT COMMITTEE

a) During the year ended 31^st March, 2024, four (4) meetings of the Board of Directors were held on 29^th May, 2023, 11^th Aug., 2023, 9th Nov., 2023 and 9^th Feb., 2024.

b) Audit & Risk Management Committee- The Company has constituted the Audit & Risk

Management Committee of the Board pursuant to Section 177 of the Companies Act, 2013 and its terms of reference are in conformity with SEBI (Listing Obligations & Disclosure Requirements) Regulations,

2015. The composition of Committee is mentioned in the Corporate Governance Report.

6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review is presented in a separate section forming part of the Annual Report for 2023-24.

7. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES

Pursuant to Section 177 of the Companies Act, 2013, the company has established a ‘Vigil Mechanism for directors and employees to report their genuine concerns to the company. The company oversees this ‘Vigil Mechanism through the Audit & Risk Management Committee of the Board.

8. ENVIRONMENT, POLLUTION CONTROL AND SAFETY

STAR is committed to provide safe working conditions and healthy environment to its stakeholders. Your company is accredited with IS/ISO 9001:2015, IS/ISO 14001: 2015, and IS/ISO 45001:2008 which signifies adoption of integrated quality, environment and safety management systems to harmonize Industrial activities with environmental preservation with letter and spirit. As required under the law, your company has the requisite environmental clearances from the Government .

Your company has been conferred the following awards during the year 2023-24:

i) Par Exellence and Gold Awards in 37^th National and 48^th International Quality Circle Conventions respectively organized by Quality Circle Forum of India, Hyderabad.

ii) Platinum Award in Apex India Green Leaf Award 2023 for water stewardship by Apex India Foundation.

iii) Award for outstanding achievement in ensuring Environment Excellence in 23^rd Annual Greentech Environment Awards, 2023 organized by Greentech Foundation.

9. SOCIAL FARM FORESTRY

Your company has been promoting and encouraging tree plantation program under social farm forestry for many years now. This not only facilitates sustained availability of Wood but also enhances rural Incomes. The program involves supply of high quality clones/seedlings apart from providing technical assistance to the farmers in the catchment areas.

The program maintained its momentum during the year too and your company further stepped-up propagation and distribution of clonal plants and the area coverage. Your company enabled plantations of approx 43.86 lacs seedlings during the year.

10. FIXED DEPOSITS

The company has not invited any fixed deposits during the year and as such there has been no default in repayment of deposit or payment of interest thereon during the year. There were no outstanding fixed deposits as on 31 ^st March, 2024. (Rs. Nil as on 31^st March, 2023).

The company is in compliance with provisions of the Companies Act, 2013 and rules made thereunder in respect of deposits.

11. INTERNAL CONTROLS

Your company has adequate internal control systems in place on the basis of which financial accounting is done and periodically financial statements are prepared. Such Internal control systems are adequate and operating effectively.

During the year, no instance of any fraud was reported by the statutory auditors of the company under section 143(12) of the Companies Act, 2013.

12. REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)

The company adopted a policy on Corporate Social Responsibility (CSR) to fulfill its obligation towards the society. The CSR Policy may be accessed on the companys website at https://www.starpapers.com. The key philosophy of the Companys CSR initiative is to promote development through social and economic transformation. The composition of Committee is mentioned in the Corporate Governance Report.

The Report on CSR activities undertaken during the financial year ended 31^st March, 2024 is provided as Annexure -I.

13. DIRECTORS/KEY MANAGERIAL PERSONNEL/ OTHERS

i) Pursuant to Section 152 of the Companies Act, 2013, Mrs. Pragya Jhunjhunwala (DIN-02315132) shall retire by rotation at the ensuing Annual General Meeting and being eligible, offers herself for re-appointment. The Board recommends her reappointment as a Director of the company

ii) Dr. (Mrs) Sheela Bhide (DIN-01843547) has been appointed as Independent Director of the company w.e.f 7^th April, 2023 to 6^th April, 2028 for a period of five consecutive years.

The Company has received declarations from all the

Independent Directors of the Company confirming that they meet the criteria of independence as laid down under Section 178 (6) of the Companies Act, 2013 and SEBI Listing Regulations, 2015. The companys familiarization program for Independent Directors is posted on the website of the company and can be accessed at https://www.starpapers. com/familarisation_prog.pdf.

14. NOMINATION AND REMUNERATION COMMITTEE/POLICY

The Board of Directors has constituted a ‘Nomination &

Remuneration Committee which follows the companys policy on directors appointment and remuneration including criteria for determining qualification, positive attitudes, independence of a director and other matters provided under section 178 (3) of the Companies Act, 2013.

The gist of companys policy on nomination and remuneration is as under:

The Committee shall consider ethical standards of integrity, qualification, expertise and experience for appointment of Directors/KMP etc. and recommend to the Board of Directors. Directors/ KMP etc shall be appointed as per the procedure laid down in applicable laws.

The Committee will recommend the remuneration to be paid to Directors/KMP etc requiring Committee approval as per statutory provisions. The level and composition of remuneration so determined by the Committee shall be reasonable and sufficient to attract, retain and motivate the appointee(s). Nomination and Remuneration Policy of the company can be accessed from the company website -www.starpapers.com.

15. LOAN, GUARANTEE, INVESTMENTS ETC.

The particulars of loan, guarantees or investments under section 186 of the Companies Act, 2013 have been given in the financial statements.

16. SUBSIDIARY/JOINT VENTUE/ASSOCIATE COMPANIES

No company has become or ceased to be the companys subsidiary/joint venture/associate company during the year.

17. PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars regarding energy conservation, technology absorption and foreign exchange earnings/outgo pursuant to Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are furnished as Annexure-II to this Report.

18. PARTICULARS OF EMPLOYEES AND REMUNERATION

Information in accordance with the provisions of Section

134(3)(q) and Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding employees remuneration are given hereunder:

i) Name of the employee who is in receipt of remuneration of Rs. 8.50 lacs per month/ Rs. 102 lacs per annum or more during the financial year 2023-24:

Sr. No.	Name & Designation	Remuneration* recd.-(lacs)	Nature of employment	Qualification & experience	Date of commencement of employment	Age	Last employment held	% of equity shares held	Whether relative to director
1	Mr. Madhukar Mishra, Managing Director	459.88	Contractual	B. Sc., DMS (Mgt.) 44 years	01/07/2001	67 years	Sr. VP (Corporate Planning)-Dail Consultants Ltd.	Nil	No

*including employers provident fund contribution.

a) Ratio of remuneration of each director to the median remuneration of employees

Director	Director remuneration (DR)-Rs.	Median remuneration (MR) of employee -Rs.	Ratio (DR/MR)
Mr. Shiromani Sharma	4,00,000	3,81,166	1.05
Mr. Shrivardhan Goenka	4,00,000	3,81,166	1.05
Mr. C.M. Vasudev	3,60,000	3,81,166	0.94
Mrs. Pragya Jhunjhunwala	1,60,000	3,81,166	0.42
Dr. (Mrs) Sheela Bhide	2,40,000	3,81,166	0.63
Mr. Madhukar Mishra	4,59,87,845	3,81,166	120.65

b) % increase in remuneration of each director, CEO, CFO, CS in the financial year 2023-24

Official name	Year 2023-24 Remuneration-Rs. In lacs	% increase in remuneration
Directors	Non-executive Directors are receiving only sitting fees for attending meetings @ Rs. 40,000/- per Board/Committee meeting.
Managing Director	459.88	12.7%
Chief Financial Officer	38.83	10.5%
Company Secretary	22.00	31.3%

c) % increase in median remuneration of employees in the financial year 2023-24 vis-a-vis the preceding year was 6.8%.

d) There were 380 permanent employees on the rolls of the company as on 31.03.2024.

e) Average increase in remuneration inter-alia depends upon the inflation, individuals performance, company policy, human resource demand-supply position, negotiations with trade unions, company performance etc.

f) Average percentage increase in salaries of employees vis-a-vis managerial personnel - Average percentage increase in salaries of employees was 16% vis-a-vis 18% in salary of managerial personnel for FY 2023-24.

g) No director is getting any variable component of remuneration except performance pay to the Managing Director are decided by the Board of Directors every year based on performance of the company, terms of appointment and applicable statutory provision. Remuneration is as per remuneration policy of the company.

19. PERFORMANCE EVALUATION

The company has a Policy on Nomination & Remuneration and Evaluation of directors etc. The Board of Directors evaluates its own performance, that of Committee(s) and individual director(s) on annual basis in the manner envisaged by the Nomination & Remuneration Committee (NRC) of the Board. Nomination & Remuneration Committee (NRC) also ensures that evaluation process is carried out by the Board every year as per the prescribed method.

20. HUMAN RESOURCES AND WELFARE

The company has a structured approach to manage its human assets as per the emerging needs of the company. Industrial relations remained cordial during the year 2023-24.

The company has zero tolerance against any sexual harassment of woman at work plance. During the year under review, there was no case reported under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. There was no complaint pending at the beginning and closure of the year.

21. DIRECTORS RESPONSIBILITY STATEMENT

As required under the provisions of Section 134(3)(c) Directors Responsibility Statement on preparation and presentation of these accounts is as per Annexure-III to this Report.

22. CORPORATE GOVERNANCE

A separate report on corporate governance, along with a certificate from the statutory auditors confirming compliance with corporate governance requirements has been annexed as Annexure-IV to Directors Report.

23. AUDITORS

The members at their 83^rd Annual General Meeting held on 21^st Sept., 2022 appointed M/s Lodha & Co., Chartered Accountants, Kolkata as statutory auditors of the company to hold office from the conclusion of 83 ^rd AGM till the conclusion of 88^th AGM of the company.

24. COST AUDITORS

Pursuant to Section 148(3) of the Companies Act, 2013 read with the Rules made thereunder, the company is required to maintain cost records and accordingly such accounts and records are maintained. The Board of Directors on the recommendation of Audit & Risk Management Committee has appointed M/s K.B. Saxena & Associates, Cost Accountants, as the Cost Auditors of the Company for the financial year 2023-24.

25. AUDITORS REPORT

i) Statutory Audit:

The observations of the auditor read with relevant notes on the financial statements are self-explanatory.

ii) Secretarial Audit:

M/s D. Dutt & Co., company secretary in practice, secretarial auditor of the company has done secretarial audit for FY 2023-24. Secretarial audit report is attached as Annexure-V. The observations of the secretarial auditor in the report are self-explanatory.

26. TRANSACTIONS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the company during the financial year with related parties were in the ordinary course of business and on arms length basis. During the year, the company had not entered into any contract / arrangement / transaction with related parties which could be considered material. Information pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies(Accounts) Rules, 2014 are given in Annexure-VI in Form AOC-2 and the same forms part of this report.

27. RISK MANAGEMENT

The Company is having Risk Management framework covering identification, evaluation and control measures to mitigate the identified business risks.

28. LISTING ON STOCK EXCHANGES

Your companys equity shares are listed on National Stock Exchange of India Ltd. (NSE) and The Stock Exchange, Mumbai (BSE). The company has paid the listing fees to the stock exchanges for the financial year 2023-24.

29. ACKNOWLEDGEMENT

The Board of Directors place on record their gratitude for valuable support and contribution of all the Stakeholders viz., employees, bankers, investors, customers, suppliers and the Government Departments during the year 2023-24.

For and on behalf of the Board

Place : New Delhi	Shiromani Sharma
Date : 24th May, 2024	Chairman