Sula Vineyards Ltd Directors Report

Dear Members,

Your Board of Directors ("Board") is pleased to present the Twenty Second (22nd) Annual Report of Sula Vineyards Limited ("the Company") together with the Audited Financial Statements of the Company for the Financial Year ended 31st March 2025

1. Key Financial Highlights (Standalone and Consolidated)

The Companys financial performance, for the year ended 31st March 2025 is summarized below:

(INR crores)

Particulars	Consolidated		Standalone
	2024-25	2023-24	2024-25	2023-24
Total Income	623.31	616.37	533.72	598.93
Profit Before Interest and Depreciation (EBITDA)	153.00	183.57	102.39	177.56
Finance Charges	29.67	26.16	25.57	23.59
Provision for Depreciation	34.99	31.63	28.92	26.81
Profit before tax	88.34	125.78	47.90	127.16
Provision for Tax	18.14	32.47	14.50	32.47
Profit after tax	70.20	93.31	33.40	94.69
Other Comprehensive Income/(Loss)	0.10	(0.66)	0.17	(0.64)
Total Comprehensive Income/(Loss)	70.30	92.65	33.57	94.05
Balance of Profit brought forward	207.03	192.40	232.30	216.26
Balance available for appropriation	277.34	285.05	265.87	310.31
Dividend paid on Equity Shares	(37.98)	(78.01)	(37.98)	(78.01)
Surplus carried to Balance Sheet	239.35	207.04	227.89	232.30

2. Business Performance & State of Company Affairs Financial Overview

FY25 was a challenging year for the Indian Wine Industry as after 3 good years of very healthy growth, the industry witnessed a temporary pause in FY25 with urban consumption slowdown adversely impacting wine demand more so than other alcobev categories given the urban markets account for lions share of the industry demand.

Despite the challenging market scenario, Sula registered its highest ever Revenue from Operations. Our Revenue from Operations was up 1.8% YoY to INR 619.4 Cr in FY25 vis-a-vis INR 608.7 Cr in FY24.

A subdued sales performance had a disproportionate impact on our operating profitability as Operating EBITDA declined by 15.2% YoY to INR 149.1 Cr in FY25.

Operating EBITDA margin contracted by 482 bps to 24.1% vs. 28.9% in FY24. Similarly, Profit after Tax (PAT) declined by 24.8% YoY to INR 70.2 Cr in FY25 with PAT margin contracting by 388 bps to 11.3% vs. 15.1% in FY24.

Our Balance Sheet continues to remain strong with Net Debt / EBITDA continuing to be below our internal benchmark of 2 times. Our Credit Rating also continued to be maintained at A+ by ICRA. The strength of our balance sheet and healthy profitability margins (Operating EBITDA Margins of ~24%), continues to enable our company to maintain fine rates on our borrowings.

Own Brands Performance

As mentioned in the earlier paragraph, FY25 was a tough year for the Indian Wine Market and Sula. After witnessing strong growth in recent years (post Covid), FY25 was a year of reset, as the industry growth saw a temporary pause given impact from the urban consumption slowdown and the temporary market disruptions we saw through the year in the form of the national elections, multiple state elections especially in our largest state of Maharashtra in Q3, and other short-term regulatory / policy disruptions in some states such as Karnataka, Delhi, and UP which also hurt industry demand albeit temporarily in FY25.

Given this market backdrop, our sales growth was subdued for FY25. Having said that, Sula continued its north ward journey and clocking highest ever Own Brand sales. Own Brands sales grew 2.2% YoY to INR 546.2 Cr in FY25 as compared to INR 534.2 Cr in FY24. Our Elite & Premium portfolio continued to outperform in FY25 registering 4.8% YoY growth to reach sales of INR 420.9 Cr with the salience of Elite & Premium improving further to 77.1% in FY25 vis-a-vis 75.2% in FY24. Traction in our Elite & Premium brands was powered by the robust double-digit growth in ‘The Source and the ‘RASA range, our key Elite brands.

Further, our commercial strategy of increasing wine adoption and width of distribution outside our top 2 markets paid off as revenue excluding Maharashtra and Karnataka recorded high-single digit growth despite the tough macro environment given the slowdown in urban consumption. We also successfully tapped price increase opportunities across some of our markets and brands.

Wine Tourism Performance

Wine Tourism segment continued to perform robustly recording another year of double-digit growth. Wine Tourism revenue for FY25 was up 10.2% to INR 60.3 Cr.

The healthy growth in our Wine Tourism driven by strong performance of our resorts which recorded improved occupancy, higher revenue per guest and a very successful SulaFest25, the 14th edition of the iconic music festival after 5 years. Resort occupancy jumped 400 bps from 74% in FY24 to 78% in FY25 while revenue per guest at our key Wine Tourism facilities increased by 7% YoY

The wine tourism holds a pivotal position in fostering awareness and boosting wine consumption in India. We continue to be among the most visited vineyards globally as we welcomed >3.3 lakh visitors in FY25. Further, we also carried out 1.55+ lakh tastings in FY25.

Production and Harvest Update

The recently concluded Harvest 2025 was excellent in both quantity and quality - marking the fifth consecutive year of strong vintages for Sula. We crushed ~9,500 tons of wine grapes in Harvest25.

Our total installed capacity grew by 1.5 million liters in FY25 from 16.7 Mn liters to 18.2 Mn liters, an increase of 9% YoY. The capacity expansion was carried at our Domaine Dindori unit, here we commissioned the 1.5 million liters low-cost cellar at 33% lower capex. This newly commissioned cellar will be used for Economy & Popular brands.

More importantly, we augmented our bottling capacity at two of our units in Maharashtra - the Nashik Winery at The Source and the ND Wines facility. Further, in Q4 FY25, we also received regulatory approval for our Nashik Winery (at the Source) to be eligible for the WIPS benefit. So, overall, we now have 4 units in Maharashtra that are eligible for maximum WIPS benefit and with that we are well placed to capture ~100% of the potential WIPS in FY25 vis-a-vis ~85% in FY24.

On the product development front, we launched the Sula Merlot, a new rich velvety red wine. Merlot being one of the most cherished red varieties globally, the Merlot is an excellent addition to our portfolio and marks the first addition to the core Sula series in nearly a decade.

A healthy harvest 2025 along with the enhanced storage capacity, ensures ample supply of wine positioning the company for a strong year ahead.

Marketing Update

In FY25, our marketing efforts focused on deepening consumer engagement and enhancing brand visibility across key touchpoints. We surpassed our digital benchmarks once again, growing our community to over 163K wine lovers. SulaFest made a grand comeback after a five-year hiatus, drawing 10,000+ attendees with its vibrant celebration of wine, music, and food. Our partnership with IndiGo took Sula cans to new heights—bringing wine to the skies. The flagship RASA Cabernet Sauvignon 2022 was awarded a prestigious Gold Medal at the Global Cabernet Sauvignon Masters 2024, marking the first-ever gold for an Indian wine at the Global Masters Awards in any category.

In FY25, we conducted 77,887 tastings across 51 cities, significantly expanding our reach through events like Viva La Vino (Goa, Pune, Mumbai, Kolkata, Delhi, Bangalore), Vinexpo, Art Mumbai, and the recordbreaking Monsoon Tasting with 117 participants - nearly double previous editions. We also made a strong showing at UpperCrust, boosting visibility among key consumer segments.

Venturing into fashion, we hosted an exclusive wine event with Saher Agiary House - a high-profile show combining style and purpose, supporting charitable causes, and connecting the brand with influential audiences. We created memorable experiences at cultural platforms such as the KNMA Spring Concert and the Alliance Franpaise Paris Olympic Launch, while also expanding our presence in tier 2 and emerging cities such as Darjeeling, Sikkim, Guwahati, Jammu, Coonoor, Ooty, Lonavala, Mahabaleshwar - introducing many to their first taste of Sula.

New listings were secured at premium properties like Hyatt Regency Delhi, Umaid Bhawan Palace Jodhpur, and The Astor Goa. We also partnered with standout restaurants including Otoki and Sixteen 33 in Mumbai, and Amiel Gourmet and Fireside in Bangalore.

Strategic collaborations with KA Hospitality, 3 Stories, and Holiday Inn further expanded our on-trade footprint and brand recall in competitive markets.

Sustainability Update

In FY25, we continued to make our operations more sustainable and environmentally friendly. We reduced our water consumption per liter of wine produced by 5% YoY, increased our solar power share as % of consumption to 66% vs. 59% LY and boosted our battery energy storage system (BESS) to ~1 MW visa-vis 0.5 MW LY E-vehicle fleet % also increased 45% in FY25 as compared to 35% last year.

Additionally, in FY26, we plan to expand BESS (Battery Energy Storage System) capacity to 2 MW to efficiently store solar energy and make it available for use during peak load times resulting in cost savings. On the whole, we remain unwavering in our commitment to spearhead sustainability initiatives

3. Reserves

During the year under review, no amount was transferred to any of the reserves by the Company.

4. Dividend

The Board of Directors at their meeting held on 8th May 2025, has recommended payment of Rs. 3.60 per equity share of face value of Rs. 2/- each fully paid- up as final dividend for the financial year 2024-25. The record date for payment of final dividend is 23rd May 2025. The final dividend, subject to the approval of the shareholders at the ensuing Annual General Meeting ("AGM") of the Company, will be paid within the statutory timelines.

The total dividend for the financial year 2024-25, amounts to Rs. 3.60 per equity share of face value of Rs. 2/- each and would involve a total outflow of Rs. 30,38,74,664.40 (Rupees Thirty Crores Thirty-Eight Lakhs Seventy-Four Thousand Six-Hundred Sixty-Four and Forty Paise Only).

In view of the applicable provisions of Income Tax Act, 1961, dividend paid or distributed by the Company shall be taxable in the hands of the shareholders, if the amount exceeds the threshold limit. Your Company shall, accordingly, make the payment of the final dividend after deduction of tax at source.

5. Management Discussion and Analysis

The Management Discussion and Analysis for the year under review, as stipulated under the SEBI Listing Regulations is annexed to this Report. (Annexure - V)

6. Material changes and commitments if any, 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

Other than stated elsewhere in this report, there are no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report.

7. Extract of Annual Return

The Annual Return (Form MGT-7) of the Company as on 31^st March, 2025 in accordance with Section 92(3) and Section 134 (3) (a) of the Companies Act, 2013 (the Act) and Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the Companys website at https://www.sulavinevards.com/ investor-relations.php

8. Details of changes in Directors and Key Managerial Personnel Appointments and resignations of Directors:

(a) Appointments

During the year under review, based on the recommendation of the Nomination and Remuneration Committee (NRC) and the Board, the shareholders have approved the following appointments:

(i) Appointment of Mr. Deepak Shahdadpuri (DIN: 00444270) as a Non-Executive Director with effect from 4^th April 2024.

(ii) Appointment of Mr. Anant S. Iyer (DIN: 00610131) as an Independent Director of the Company for a term of three years, effective from 12^th November 2024 to 11^th November 2027.

(iii) Re-appointment of Mr. Alok Vajpeyi (DIN: 00019098) as an Independent Director of the Company for second term of three years, effective from 15^th December 2024 to 14^th December 2027#.

(iv) Re-appointment of Mr. Chetan Desai (DIN: 03595319) as an Independent Director of the Company for second term of three years, effective from 15^th December 2024 to 14^th December 2027

(v) Re-appointment of Ms. Sangeeta Tanwani (DIN: 03321646) as an Independent Director of the Company for second term of three years, effective from 15^th December 2024 to 14^th December 2027.

#Mr. Chetan Desai has stepped down as Chairperson of the Board and Mr. Alok Vajpeyi was elevated to Chairperson of the Board w.e.f. 15^th December 2024, as a part of succession planning.

(b) Resignations

During the year under review, Mr. Arjun Anand (DIN: 07639288) resigned as a Non-Executive Nominee Director, effective close of business hours on April 4, 2024.

Mr. Riyaaz Amlani (DIN: 00261209) resigned as a NonExecutive Independent Director, effective close of business hours on April 4, 2024.

(c) Retirement by rotation and subsequent reappointment

In accordance with the provisions of Section 152 of the Companies Act read with provisions contained in the Articles of Association of the Company, Mr. Deepak Shahdadpuri is liable to retire by rotation at the ensuing Annual General Meeting of the Company and being eligible has offered his candidature for reappointment. The notice convening the AGM includes the proposal for re-appointment of Directors.

Brief resume, nature of expertise, disclosure of relationship between directors inter-se, details of directorships and committee membership held in other companies of the Directors proposed to be appointed/re-appointed, along with their shareholding in the Company, as stipulated under Secretarial Standard-2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing Annual General Meeting.

(d) Appointments and resignations of Key Managerial Personnel:

Appointments

(i) Ms. Shalaka Koparkar (Membership No. A25314) was appointed as Company Secretary and Compliance Officer of the Company with effect from November 12, 2024.

Resignations

(i) Ms. Ruchi Sathe stepped down from her role as Company Secretary and Compliance Officer of the Company, with effect from the close of business hours on October 1, 2024.

(ii) Mr. Karan Vasani stepped down from his role as Chief Operating Officer of the Company, with effect from the close of business hours on December 20, 2024^*.

*Mr. Gorakh Gaikwad was appointed as the Chief Operating Officer of the Company with effect from December 21, 2024, under the category of Senior Management Personnel (SMP).

(e) Key Managerial Personnel

In accordance with the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are

the Key Managerial Personnel of the Company:

(i) Mr. Rajeev Samant, Managing Director and Chief Executive Officer

(ii) Mr. Abhishek Kapoor, Chief Financial Officer

(iii) Ms. Shalaka Koparkar, Company Secretary and Compliance Officer

9. Disclosures, Declarations and Annual Affirmations

i. Based on the declarations and confirmations received from the Directors, none of the Directors of the Company are disqualified from being appointed/ continuing as Directors of the Company.

ii. Affirmation of all members of the board of directors and Senior Management Personnel have been received on the code of conduct for board of directors and senior management.

iii. Pursuant to the provisions of Section 149 of the Act, the Independent Directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b), 25(8) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company.

iv. The Company has also received from Independent Directors, declaration of compliance of Rule 6 (1) & (2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, regarding online registration with the "Indian Institute of Corporate Affairs" at Manesar, for inclusion of name in the data bank of Independent Directors.

v. The Board has taken on record the declarations and confirmations submitted by the Independent Directors after undertaking due assessment of the veracity of the same.

10. Board of Directors:

The Board comprises of seven directors with a balanced composition of executive, non-executive and one Independent Woman Director, ensuring strong corporate governance and safeguarding stakeholder interests. Their collective expertise and integrity drive strategic decision-making and enhance long-term value creation. The Board of Directors met 6 (six) times during the year under review. Further details of composition of board of directors including remuneration, number of meetings and attendance thereof, forms part of report on corporate governance which is appended as Annexure II to this Board Report.

In the opinion of Board, all Independent Directors are persons of integrity and fulfils requisite conditions as per applicable laws and are independent of the management of the Company.

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses, if any.

Committees of the Board of Directors

(i) Audit Committee:

The Company has constituted an Audit Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 18 of the SEBI Listing Regulations. The details relating to the same are given in Annexure II - Report on Corporate Governance forming part of this Board Report.

(ii) Nomination and Remuneration Committee:

The Company has constituted Nomination and Remuneration Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 19 of the SEBI Listing Regulations. The details relating to the same are given in Annexure II - Report on Corporate Governance forming part of this Board Report.

(iii) Stakeholders Relationship Committee:

The Company has constituted Stakeholders Relationship Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 20 of the SEBI Listing Regulations. The details relating to the same are given in Annexure II - Report on Corporate Governance forming part of this Board Report.

(iv) Risk Management Committee:

The Company has constituted Risk Management Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 21 of the SEBI Listing Regulations. The details relating to the same are given in Annexure II - Report on Corporate Governance forming part of this Board Report.

(v) Corporate Social Responsibility Committee:

The Company has constituted Corporate Social Responsibility Committee in terms Section 135 of the Companies Act, 2013 read with the rules made thereunder. The details relating to the same are given in Annexure II - Report on Corporate Governance forming part of this Board Report.

12. Familiarization Programme for Independent Directors

The Company implements a comprehensive induction program for all Directors, including Independent Directors, upon their appointment. This program, complemented by ongoing updates throughout the year, ensures thorough familiarization with the Companys operations, business model, values, culture and industry landscape. A detailed note on the familiarization programme adopted by the Company for orientation and training of the Directors is provided in the Report on Corporate Governance which forms part of this Integrated Report.

Details of Familiarization programs are updated on companys website at https://sulavinevards.com/ files/0425/Familiarisation%20Programme%20 for%20Independent%20Directors.pdf

13. Board Evaluation

In terms of the requirements of the Act and the SEBI Listing Regulations, an annual performance evaluation of the Board is undertaken where the Board formally assesses its own performance with the aim of improving the effectiveness of the Board and its Committees.

The Company has a structured assessment process, wherein the Nomination and Remuneration Committee (‘NRC) has laid down the manner of performance evaluation of the Board, its Committees, Non - Executive and Independent Directors, Managing Director and the Chairperson. The evaluations are carried out in a confidential manner and the Directors provide their feedback by rating based on various metrics. The performance evaluation activity is conducted under the guidance of the Chairperson of NRC.

In a separate meeting of Independent Directors, performance of Non-Independent Directors including the MD & CEO, the Board as a whole were discussed and evaluated. Performance evaluation of Independent Directors was done by the entire Board, excluding the Independent Director being evaluated.

Board Evaluation process was conducted through structured questionnaires which cover various aspects of the Boards functioning such as adequate composition of the Board and its Committees, Members strengths and contribution, execution and performance of specific duties, obligations and governance.

The survey results and feedback from directors were discussed in meetings of the Independent Directors, NRC and the Board to identify areas for improvement in director performance and board processes, ultimately enhancing overall board effectiveness.

14. Share Capital

Authorized Share Capital

The Authorized Share Capital of the Company as on 31^st March 2025 is INR 20,20,60,000 (Rupees Twenty Crores Twenty Lakhs Sixty Thousand Only) divided into 10,10,30,000 (Ten Crores Ten Lakhs Thirty Thousand only) equity shares having face value of INR 2/- (Rupees Two) each.

Paid up and Subscribed Share Capital

The paid up and subscribed share capital of the Company as on 31^st March 2025 is INR 16,88,19,258/- (Rupees Sixteen Crore Eighty-Eight Lakhs Nineteen Thousand Two Hundred and Fifty - Eight Only) comprising of 8,44,09,629 (Eight Crore Forty - Four Lakhs Nine Thousand Six Hundred and Twenty-Nine) equity shares having face value of INR 2/- (Rupees Two) each.

15. Remuneration of Directors and Employees

Disclosure comprising particulars with respect to the remuneration of directors and employees, as required to be disclosed in terms of the provisions of Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure - I to this Report.

The information in respect of employees of the Company pursuant to Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in Annexure - I forming part of this report. In terms of section 136(1) of the Companies Act, 2013 and the rules made thereunder, the Report and Accounts are being sent to the shareholders excluding the aforesaid Annexure. Any member interested in obtaining a copy of the same may write to the Company Secretary at the Registered Office of the Company.

16. Statutory Auditors

Walker Chandiok & Co. LLP, Chartered Accountants, (Firm Registration No. 001076N/ N500013), have been appointed as Statutory Auditors of the Company at the 19th Annual General Meeting held on May 27, 2022, for a period of 5 years from conclusion of 19th Annual General Meeting till the conclusion of the 24th Annual General Meeting of the Company to be held in the year 2027 at such remuneration as may be decided by the Board of Directors of the Company. The Auditors have confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants of India (ICAI) and hold valid certificate issued by the Peer Review Board of the ICAI.

The Audit Committee reviews the independence and objectivity of the Auditors and the effectiveness of the Audit process.

The Statutory Audit Report for the year 2024-25 does not contain any qualification, reservation or adverse remark or disclaimer. During the year under review, the Auditors have not reported any fraud under Section 143(12) of the Act.

During FY 2024-25, the total fees for all services paid by the Company and its subsidiaries, on a consolidated basis, to Walker Chandiok & Co. LLP, Chartered Accountants, Statutory Auditor is Rs. 94 lakhs plus taxes. These fees are paid towards Statutory & Tax Audit and Limited Review.

17. Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Sunil Agarwal & Co., Practising Company Secretary, to undertake the secretarial Audit of the Company for Financial Year 2024-25. The Report of the Secretarial Audit is annexed herewith as Annexure- III. The Report does not contain any observation or qualification requiring explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

In terms of the provisions of SEBI Listing Regulations read with the circulars issued by SEBI dated 12^th December 2024 and 31^st December 2024, the Board, at its meeting held on 8th May 2025, has appointed Sunil Agarwal & Co., Practising Company Secretary, as Secretarial Auditor, subject to the approval of shareholders in ensuing Annual General Meeting, for conducting Secretarial Audit of the Company for a term of 5 consecutive years w.e.f. 1^st April 2025 till 31^st March 2030, at a fee of Rs. 1,55,000 for FY 2025-26 (plus taxes as applicable) and remuneration for the subsequent years as may be decided by the Board of Directors in consultation with the Secretarial Auditor of the Company. The Secretarial Auditors have confirmed that they have subjected themselves to the peer review process of Institute of Company Secretaries of India (ICSI) and hold valid certificate issued by the Peer Review Board of the ICSI.

For FY 2024-25, the total fees paid for issuance of Secretarial Audit Report and Statutory Certificate by the Company and its material subsidiary, on a consolidated basis, to Sunil Agarwal & Co., Practising Company Secretary, Secretarial Auditor is INR 3 Lakhs plus applicable taxes.

18. Reporting of Fraud

There were no frauds committed against the Company during FY 2024-25 by its officers or employees which are required to be disclosed as per Section 143(12) of the Companies Act, 2013.

19. Details of the adequacy of internal financial controls

The Board of Directors and management of the Company are responsible for establishing and maintaining adequate internal financial controls to ensure the reliability and integrity of financial reporting. These controls have been designed in accordance with the applicable regulatory framework to provide reasonable assurance regarding the accuracy of financial statements and compliance with statutory obligations.

The management team has assessed the effectiveness of the Companys internal control over financial reporting as at March 31, 2025 and believe that these systems provide reasonable assurance that our internal financial controls are designed effectively and are operating as intended.

The Company has established a robust system of internal controls commensurate with the size and operations to ensure that assets are safeguarded, and transactions are appropriately authorised, recorded and reported. The controls have been documented, digitized, and embedded in the business process.

• Segregation of Duties: Clearly defined roles and responsibilities to prevent unauthorized transactions.

• Authorization and Approval Processes: Stringent approval mechanisms for financial transactions and capital expenditures.

• Periodic Monitoring and Audits: Regular internal audits and management reviews to assess the effectiveness of controls.

• IT and System Controls: Implementation of advanced financial reporting systems and cybersecurity measures to safeguard financial data.

Assurance on the effectiveness is obtained through management reviews, controls self-assessment and periodic reporting of the in-house team that evaluates and provides assurance of its adequacy and effectiveness. The controls are also tested by the internal and statutory auditors during their audits. The Statutory Auditors of the Company have audited the financial statements included in this Annual Report and issued their report on internal control over financial reporting (as defined under section 143 of the Companies Act, 2013).

20. Directors Responsibility Statement

Pursuant to Section 134 (3) (c) and 134 (5) of the Companies Act, 2013, Directors of your Company confirm that:

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

b) the Directors had selected appropriate 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 out 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 had prepared the annual accounts on a going concern basis;

e) the Directors had laid down proper internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.

The aforesaid statement has also been reviewed and confirmed by the Audit Committee of the Board of Directors of the Company.

21. Business Responsibility and Sustainability Report

As per Regulation 34 of the SEBI Listing Regulations, a separate section on Business Responsibility and Sustainability Reporting (BRSR) forms a part of this Integrated Annual Report BRSR is attached as Annexure - VI.

22. Subsidiaries/ Joint Venture/ Associate Companies:

The Company has 2 (two) wholly owned subsidiaries as on 31^st March 2025. There are no associate companies or joint venture companies within the meaning of section 2(6) of the Companies Act, 2013 ("Act").

A statement in Form AOC-1 as required under Section 129(3) of the Companies Act, 2013 containing salient features of the financial statements of the subsidiary companies is forming part of this Annual Report in Annexure - VII.

23. Issue of employee stock options

In terms of the provisions of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SBEB Regulations") and pursuant to the recommendation of the Nomination and Remuneration Committee ("NRC"), approval of the Board and the members of the Company, following schemes were duly implemented:

a) Sula Vineyards Employees Stock Option Scheme 2021 (‘ESOP 2021)

b) Sula Vineyards Employees Stock Option Scheme 2023 (‘ESOP 2023)

The disclosure relating to ESOPs required to be made under the provisions of the Companies Act, 2013 along with the rules made thereunder and the SBEB Regulations is provided on the website of the Company: https://sulavinevards.com/investor-relations.php

A certificate from the Secretarial Auditor of the Company, confirming that the aforesaid schemes have been implemented in accordance with the SBEB Regulations, will be open for inspection at the 22nd Annual General Meeting which is also available on the website of the Company: https://sulavinevards.com/ investor-relations.php

24. Vigil Mechanism

The Company has established Vigil Mechanism (Whistleblower policy) in accordance with the provisions of Section 177(9) & (10) of the Companies Act, 2013 to report instances of unethical behaviour, actual or suspected fraud or violation of the code of conduct or any policy of the Company. The Vigil Mechanism Policy has been uploaded on the website of the Company at below link: https://sulavineyards. com/files/1123/Vigil%20Mechanism%20and%20 Whi.stleblower%20Policy.pdf

Further details with respect to the Vigil Mechanism, forms part of report on corporate governance which is appended as Annexure II to this Board Report.

25. Risk Management

At Sula Vineyards, we recognize that effective risk management is essential to achieving our strategic objectives and ensuring long-term sustainability. Our focus is to identify and embed mitigation actions for material risks that could impact our current or future performance, and/or our reputation. Our approach is holistic and integrated, bringing together risk management, internal controls, and business integrity, ensuring that our activities across this agenda focus on the risks that could have the greatest impact.

The nature of business is such that it is subject to certain risks at different points of time. Some of these include escalation in the cost of raw materials and other inputs, increasing competitive intensity from other players, changes in regulation from central and state governments, cyber security, data management and migration risks, data privacy risk, environmental and climate risk. Sula Vineyards has always had a proactive approach when it comes to risk management where it periodically reviews the risks and strives to develop appropriate risk mitigation measures for the same.

To enhance this focus, the Board of Directors has constituted a Committee of the Board called the Risk Management Committee to frame, implement and monitor risk management plan.

Our approach:

• Risk Identification: Management identifies areas that may positively or negatively affect the Companys ability to implement its strategy and achieve its objectives and performance goals. ^•

• All aspects of internal risk such as Strategic Risk, Business Risk, Finance Risk, Environment Risk, Personnel Risk, Operational Risk, Reputation Risk,

Regulatory Risk, Technology Risk and Information and Cyber Security Risk and external risk such as Sectoral Risk, Sustainability Risk and Political Risk are covered as part of the Risk Management Committee meeting.

• Root Cause Analysis: Root cause analysis enables tracing the reasons / drivers for existence of a risk element and helps developing appropriate mitigation action.

• Risk Scoring: An analysis of all internal processes and support functions is done to determine the likelihood and impact of risk elements.

• Risk Categorisation: The identified risks are further grouped into (a) Controlled; (b)Serious; (c) Disruptive; (d)Severe and (e)Critical.

• Risk Mitigation: Management is developing appropriate responsive action on review of various alternatives, costs and benefits, with a view to manage identified risks and limit the impact to tolerance level. Risk mitigation plan drives policy development as regards risk ownership, control environment timelines, standard operating procedure, etc.

• Risk Monitoring & Reporting: It is designed to assess on an ongoing basis, the functioning of risk management components and the quality of performance over time.

26. Nomination and Remuneration Policy

This Nomination and Remuneration Policy (the "Policy") has been formulated by the Company in compliance with Section 178 of the Companies Act, 2013.

In accordance with the Nomination and Remuneration Policy, the NRC formulates the criteria for appointment as a Director, Key Managerial Personnel and Senior Management, identifies persons who are qualified to be Directors and nominates candidates for Directorships subject to the approval of Board, evaluates the performance of the individual directors, recommends to the Board, remuneration to Managing Director / Whole- time Directors, ensures that the remuneration to Key Managerial Personnel, Senior Management and other employees is based on Companys overall philosophy and guidelines and is based on industry standards, linked to performance of the self and the Company and is a balance of fixed pay and variable pay and recommends to the Board, sitting fees/ commission to the Non-Executive Directors.

The Companys Nomination and Remuneration Policy for Directors, Key Managerial Personnel and senior management is available on the website of the Company at below link:

https://sulavinevards.com/files/0423/Nomination%20and%20Remuneration%20Policy.pdf

The NRC has also formulated a separate policy on the Diversity of the Board of Directors which is available on the website of the Company at below link: https://sulavineyards.com/files/0423/Diversity%20 of%20the%20Board%20of%20Directors%20Policy.pdf

27. Particulars of Deposits

During the year under review, the Company has not accepted any deposits falling within the ambit of section 73 of the Companies Act, 2013 and the rules framed thereunder. The Company does not have any unclaimed deposits as of date.

28. Loans, Guarantees and Investments

Pursuant to Section 186 of the Companies Act, 2013 disclosure on particulars relating to Loans, Advances, Guarantees and Investments are provided as a part of the financial statements.

29. Maintenance of Cost Records

The provisions pertaining to maintenance of Cost Records as specified by the Central Government under subsection (1) of section 148 of the Companies Act, 2013, are not applicable to the Company.

30. Corporate Social Responsibility (CSR)

The initiatives with respect to CSR, the CSR policy framework and Annual Action Plan of CSR activities undertaken during the year are available on the website of the Company: https://sulavineyards.com/ investor-relations.php. The disclosures required to be given under section 135 of the Companies Act, 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in Annexure - IV forming part of this Board Report.

31. Related Party Transactions

In line with the requirements of the Act and the SEBI Listing Regulations, the Company has formulated a Policy on Related Party Transactions. The Policy can be accessed on the Companys website at below link: https://sulavinevards.com/files/0823/Policv%20on%20 Related%20Party%20Transactions.pdf

During the year under review, all related party transactions entered into by the Company, were approved by the Audit Committee and were at arms length and in the ordinary course of business. Prior omnibus approval is obtained for related party transactions, which are repetitive in nature and entered in the ordinary course of business and on an arms length basis. During the year under review, there were no material related party contracts entered into by the Company requiring shareholders approval.

Accordingly, the disclosure of related party transactions as required under Section 134 (3) (h) of the Act in Form AOC-2 is not applicable to the Company for FY25 and hence does not form part of this report. Details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the notes to the standalone/ consolidated financial statements forming part of this Integrated Report & Annual Accounts 2024-25.

Dematerialization of Shares

The Companys shares are compulsorily tradable in electronic form. As on the date of this report, 100% of the Companys total paid up capital are in dematerialized form. Pursuant to amendments in SEBI Listing Regulations, requests for effecting transfer of securities in physical form, shall not be processed by the Company and all requests for transmission, transposition, issue of duplicate share certificate, renewal/exchange of securities certificate and endorsement need to be processed only in dematerialized form.

33. Details of significant and material orders passed by the regulators or courts

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future.

34. Disclosure as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (‘POSH Act) and the Rules made thereunder.

The Company has complied with the provisions relating to the constitution of the Internal Complaints Committee as per the POSH Act.

During the year under review, the Company did not receive any sexual harassment complaints.

35. Dividend Distribution Policy

In terms of Regulation 43A of SEBI Listing Regulations, your Company has formulated a Dividend Distribution Policy, with an objective to provide the dividend distribution framework to the Stakeholders of the Company. The policy sets out various internal and external factors, which shall be considered by the Board in determining the dividend payout.

The policy is available on the website of the Company at below link:

https://sulavinevards.com/files/0823/Dividend%20

Distribution%20Policv.pdf

36. Other Disclosures

a. Unclaimed Dividend:

The Company after listing have declared three dividends including two final dividends and one interim dividend. Shareholders can claim their unclaimed/ unpaid dividends by sending a written request to the Company at cs@sulawines.com or to the Companys RTA at einward.ris@kfintech.com.

b. MSME:

The Company has registered itself on Trade Receivables Discounting System platform (TReDS) through the service providers TReDS Limited. The Company complies with the requirement of submitting a half yearly return to the Ministry of Corporate Affairs within the prescribed timelines.

c. Statutory Compliance:

The Company has adequate systems and processes in place to comply with all applicable laws and regulations, pay applicable taxes on time, and ensures statutory CSR spend.

d. Consolidated Financial Statements:

Your Directors are pleased to attach the Consolidated Financial Statements pursuant to section 129(3) of the Companies Act, 2013 and Regulation 34 of the SEBI Listing Regulations, prepared in accordance with the provisions of the Companies Act, 2013 and the Indian Accounting Standards (Ind AS).

e. Insolvency and Bankruptcy Code, 2016

No proceedings are made or pending under the Insolvency and Bankruptcy Code, 2016 and there is no instance of one-time settlement with any Bank or Financial Institution;

37. Secretarial Standards

The Company has complied with Secretarial Standards on Board Meetings and General Meetings issued by the Institute of Company Secretaries of India.

38. Conservation of energy, technology absorption and foreign exchange earnings and outgo

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

a) Conservation of energy

0) the steps taken or impact on conservation of energy	* The solar energy accounts 66% of energy requirements of Sule ? The co m pa ny i s a i m i ng to i ncrease its total electric vehicle fleet from 45% to 55% in FY26, which will gets charged on solar energy * Installation of Burkert system has helped us to reduce power consumption at our DD (cellar 45 by 37% ? Installation of an additiona 1 Battery Energy Storage System allows u$ to store energy for use during peak hours * Byinstallingamethanegascapturesystemrfor power generation
00 the steps taken by the company for utilizing alternate sources of energy	*- Solar Roof Top PV system * Bu rkprt Ten k tem perature control system * Electrical Veh ide ? Battery Energy storage system * Meth ane Gas ce ptu re system ? Solar water pumping system ? Solar water heating system ? Biogas plant * Rainwater harvesting
(ill) the capital investment on energy conservation eouioments	- 15.29 Cr

b) Technology absorption

the efforts made towards technology absorption	* Installation of additional 521 Kwh BESS system * I n stallatio n of Bu rkert system * MethaneGascapture system
the benefits derived like product improvement, cost reduction, product development or import substitution in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-	* With the use of the Burkert system we saved 37% power consumption at cellar operations * Installation of methane gas capture system helps to generate power units with the help of Methane gas
(a) the details of technology imported	-
(b) the year of import;	-
l whether the technology been fully absorbed	-
(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof	-
the expenditure Incurred on Research and Development	-

c) Foreign exchange earnings and Outgo

Foreign exchange	Year ended 31st March 2025 (INR in crores)	Year ended 31st March 2024 (I NR in crores)
(i) Earnings	5.66	7.33
(ii)Outgo	10.24	14.70

39. Acknowledgements

Your directors would like to express their sincere appreciation for the assistance and co-operation received from the banks, Government authorities, customers, vendors, and members during the year under review.

Your Directors take this opportunity to place on record their deep sense of appreciation for the committed services by the Companys executives, staff and workers. The Directors would also like to thank the shareholders for their support and contribution. We look forward to their continued support in future.

	For and on behalf of the Board
	Rajeev Samant	Alok Vajpeyi
Place: Mumbai	Managing Director and CEO	Chairperson & Independent Director
Date: 8th May 2025	DIN:00020675	DIN:00019098