tanfac industries ltd share price Directors report

To

The Members,

Your directors are pleased to present the report on the Company?s business operations together with the Audited Statement of Accounts for the financial year ended 31^st March, 2023, for your review.

FINANCIAL RESULTS:

[in Crores]

Particulars	Financial Year 2022-23	Financial Year 2021- 22
Sales	374.95	320.17
Other Income (including operating income)	7.92	3.40
Operating Expenditure	300.19	245.01
Profit before Depreciation, Finance Cost and Taxation (PBDIT)	82.68	78.56
Finance Cost	0.88	1.02
Depreciation/Impairment/Amortization	6.33	5.60
Profit before Tax (PBT)	75.46	71.94
Current Tax/Deferred Tax (Net of MAT Credit Entitlement)	19.36	18.66
Profit After Tax (PAT)	56.13	53.28
Other Comprehensive Income/(Loss)	0.06	0.66
Total Comprehensive Income	56.06	53.94

OPERATIONS AND OVERALL PERFORMANCE:

During the year under review, the Company had registered highest ever EBIDTA and Net Profit in its history on the back of strong performance of its key products viz. Hydrofluoric Acid, Sulphuric Acid and Specialty Fluorine Chemicals supported by significant improvements in operation.

Earnings before Depreciation, Finance Cost and Taxation had increased by 5% at ? 82.7 Crores during the year, compared to ? 78.6 Crores in the corresponding period of the previous year.

Total comprehensive Income for the year was higher at ? 56.1 crores during the year against ? 53.9 crores during previous year.

Detailed analysis of performance of the Company is provided under Management Discussion and Analysis (MD & A) which forms part of the Annual Report.

DIVIDEND:

The Board of Directors have recommended a final dividend at the rate of 65%, ? 6.50/- (Rupees Six and Fifty paise only) per equity share of ? 10/- each, for the financial year ended 3ist March, 2023. If the final dividend is approved by the Members at this Annual General Meeting to be held on 27t^h September, 2023, it will be paid on or before 24* October, 2023 to those Members whose names appear in the Company?s Register of Members as of the close of business hours on 20t^h September, 2023.

Your Company paid the final dividend for the year 2021-22 at the rate of @ 55%), ? 5.50/- (Rupees five and Fifty paise only) per equity share of ? 10/- each, on 06* October, 2022 to the shareholders whose names appeared in the Register of Members on 19* September, 2022.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

In terms of Section 125 of the Companies Act, 2013, the Company had transferred the amount of Interim and final Dividends for the year 2021-22 to the respective shares which were already been transferred to the Investor Education and Protection Fund (IEPF) established by the Central Government

Procedure for claiming the shares and unclaimed Dividend amounts from IEPF Authority is given in this Notice of 49^th Annual General Meeting.

REVIEW OF BUSINESS OPERATIONS AND FUTURE PROSPECTS:

As briefed under Management Discussion and Analysis section, the ongoing initiatives taken by the Company during the past few years have helped in continuous improvements in the operations of the Company across all spheres.

The Company plans to continue its focus on increasing the volume of its key products including the value-added products (VAP) during the coming years through market penetration and process improvements.

Your Board of Directors is optimistic of continuous improvements in the operational performance of the Company in the coming years.

ALUMINIUM FLUORIDE:

Your Company continues with its strategy of reduced focus on Aluminum Fluoride due to its lower contribution. However, your Company will continue to serve its long-term customers while keeping an eye on the overall bottom-line.

HYDROFLUORIC ACID (HF) & VALUE-ADDED PRODUCTS (VAPS):

Your Company continues to widen the Customer base and has also made significant progress in stringent specialty applications. Your Company was able to increase the volume during the year. Your Company will embark upon identification of downstream VAPs in the future to reduce its over dependence on the traditional markets which are getting increasingly competitive.

SULPHURIC ACID:

Your Company continued its robust performance in Sulphuric Acid due to the concerted & continuous efforts made to improve the productivity and overall operational efficiencies through process optimization and innovation.

EXPORTS:

Export turnover had increased by 19% to ? 18.63 Crores against ? 15.63 crores in the previous year. Your Company endeavors continuously to improve export performance by expanding the customer base in the current market and penetrating to new markets.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no 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.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act,

2013 read with Rule 8(3) of the Companies (Accounts) Rules,

2014 is furnished as Annexure - A to the Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Your Company has not provided any loan(s), guarantee(s) to any person or body corporate and has not made any investment(s) during the year under Section 186 of the Companies Act, 2013.

PUBLIC DEPOSITS

The Company has not accepted any deposits from Public within the meaning of Section 73(1) of the Companies Act, 2013, during the year under review.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

In line with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is available on Company?s website www.tanfac.com. The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and the Related Parties.

During the financial year, the transactions with related parties were entered on an arm?s length basis and in the ordinary course of business. There were no ‘material? contracts or arrangements or transactions, and therefore disclosure in form AOC-2 is not required.

The Company has obtained necessary prior omnibus approval of Audit Committee and the Board pertaining to Related Party Transactions which were in the ordinary course of business and on an arm?s length basis. All such transactions which are foreseen and repetitive in nature and/or entered in the Ordinary Course of Business and are at Arm?s Length are placed before the Audit Committee on a quarterly basis for its review and approval.

AUDITORS & AUDITORS REPORT:

In terms of the provisions of Section 139 of the Act and the Companies (Audit and Auditors) Rules, 2014, M/s. Singhi & Co., Chartered Accountants, Kolkata (Firm Registration No.302049E) were appointed as Statutory Auditors of the Company for a first term of five years from the conclusion of the 47^th Annual General Meeting held on 28^th September, 2021 up to the conclusion of the 52^nd Annual General Meeting.

As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Report given by the Auditors on the financial statements of the Company forms part of the Annual Report. There were no qualifications, reservations or adverse remarks made by the Auditors in their report and no fraud was reported under Section 143(12) of the Companies Act, 2013.

AUDITORS? CERTIFICATE ON CORPORATE GOVERNANCE

As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Compliance Certificate on Corporate Governance given by the Statutory Auditors, viz., M/s. Singhi & Co., is forming part of the Annual Report.

COST AUDITOR

The Board of Directors of the Company had, on the recommendation of the Audit Committee, approved the appointment of Shri N. Krishna Kumar, Cost Accountant, Cuddalore (Membership No.27885) for conducting the audit of cost records of the Company pertaining to Inorganic and Organic products manufactured by the Company covered under Central Excise Tariff Heading Chapter Nos. 28 and 29 respectively in compliance with the Companies (Cost Records and Audit) Rules, 2014.

The Board of Directors at their meeting held on 21^st April, 2023, have appointed Shri N. Krishnakumar, Cost Accountant as Cost Auditor for the Financial Year 2023-24 and necessary filing has been made with the Central Government.

The Cost Audit Report for the financial year 2022-23 due to be filed with Ministry of Corporate Affairs (MCA) had been filed within the due date and there were no qualifications, observations or adverse remarks made by the Cost Auditor in his report.

SECRETARIAL AUDITOR:

The Board, in their meeting held on 20^th January 2023, had appointed Ms. Kalyani Srinivasan (Practicing Company Secretary, Chennai (C.P. No.3109 & FCS No.5854) to conduct Secretarial Audit for the Financial Year 2022-23, which, inter alia, includes audit of compliance with the Companies Act, 2013, and the Rules made under the Act, Listing Agreement and Regulations and Guidelines prescribed by the Securities and Exchange Board of India.

The Secretarial Audit Report as required under Section 204 of the Companies Act, 2013 read with Rule 9 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is furnished under Annexure - C, does not contain any qualification, reservation or adverse remark.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR:

There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations.

CHANGE IN PROMOTOR AND MANAGEMENT CONTROL:

As disclosed under Note No.28.2 of the Financial Statements, on 11t^h March, 2022, M/s Anupam Rasayan India Limited (ARIL) acquired 24,89,802 shares held by Aditya Birla Group (ABG) through a Share Purchase Agreement dated 1st February, 2022 and obtained joint control over the Company along with the continuing promoter M/s Tamil Nadu Industrial Development Corporation Limited (TIDCO). Based on the original Joint Venture Agreement (JV) signed by ABG and TIDCO, ARIL replaced ABG as promoter and obtained Management Control of the Company.

This acquisition of management control had triggered open offer and in compliance with the SEBI SAST Regulations, ARIL had made open offer to the public shareholders and acquired 83,279 shares (0.83%) tendered by public during the tendering period.

The Company had made an application dated 28t^h May, 2022 to the Bombay Stock Exchange to seek the approval for reclassification of erstwhile promoters as public category and M/s Anupam Rasayan India Limited (ARIL) under the new promoter category. Upon the application, the Bombay Stock

Exchange approved the reclassification Promoters category on 24t^h February, 2023.

ANNUAL PERFORMANCE EVALUATION:

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out the Annual Performance Evaluation of the Board, its committees and of individual directors in the format (questionnaire) prescribed by the Nomination and Remuneration Committee of the Company.

The structured questionnaire covers various aspects of the Board?s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance etc.

The performance evaluation of the Directors (without participation of the relevant Director) was carried out by the entire Board. The Directors expressed their satisfaction with the evaluation process.

SEPARATE MEETING OF INDEPENDENT DIRECTORS:

The Independent Directors of the Company met during the year to review the performance of Non- Independent Directors and the Board as a whole, reviewed the performance of the Chairperson of the Company and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board without the presence of the NonIndependent Directors and members of the Management.

RISK MANAGEMENT POLICY:

The Company has internally constituted a Risk Management Committee to define its roles and responsibilities and laid down the procedure to assess the risk and minimization procedures. The Risk Management includes identifying types of risks and its assessment, risk handling & monitoring and reporting. The Board through its Audit Committee shall also be responsible for framing, implementing and monitoring the risk management plan for the Company. The details of identified risk and mitigation plan would be reviewed by the Committee every quarter and forwarded with their recommendation, if any to the Audit Committee/Board for its review.

The details of Risk Management as practiced by the Company are provided as part of Management Discussion and Analysis Report.

Your Company has become a top 1000 Company with effect from 1st April, 2023 based on the market capitalization of BSE as on 31st March, 2023. To comply with the listing requirement for the top 1,000 companies, the Board, in its meeting held on 21st April, 2023, had duly constituted Risk Management Committee. The details of the members of the Committee have been given elsewhere in the report.

POLICIES

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, mandated the formulation of certain policies for all listed entities. The policies are reviewed periodically by the Board and updated based on need and new compliance requirements and are available on the Company?s official website viz., www.tanfac.com.

Name of Policy	Brief description	Web URL
Related Party Transaction	The policy to regulate all transactions between the Company and its Related Parties in compliance with various applicable laws, including under the Companies Act, 2013/SEBI (LODR) Regulations, 2015.	http://www.tanfac.com/documents/ policy Materiality Of Related Party Transactions.pdf
SEBI (prohibition of Insider Trading) Regulations, 2015	The Policy provides for fair disclosure of unpublished price sensitive information in dealing with securities of the Company.	http://www.tanfac.com/documents/ policy sebi.pdf
Whistle Blower Policy (vigil mechanism)	The Company has established a vigil mechanism for its Directors and Employees to report their genuine concerns or grievances or violation of the Company?s code of conducts and ethics, which will be monitored by the Audit Committee.	http://www.tanfac.com/documents/ policy Whistle Blower.PDF
Criteria for making payment to Non Executive Directors	Except sitting fee for attending Board, Audit Committee and Stakeholders Relationship Committee meetings NO other remuneration paid to Directors.	http://www.tanfac.com/documents/ who non executive directors.pdf
Policy for determi-nation of materiality of information or event	This Policy facilitating prompt disclosure of material price sensitive information to the listed Stock Exchange(s) prepared in terms of SEBI (LODR) Regulations, 2015.	http://www.tanfac.com/documents/ policy matrl event.pdf
Policy on Archival of documents	The policy framed for archival of the Company?s records as required under SEBI (LODR) Regulations, 2015.	http://www.tanfac.com/documents/ policy archival policy.pdf
Policy on preservation of documents	The policy deals with retention of documents in permanent nature and not less than eight years after completion of the relevant transactions.	http://www.tanfac.com/documents/ policy preservation Doc.pdf
Risk Assessment and Management Policy	The purpose of this Policy is to define, design and implement a risk management framework across the Company to identify, assess, manage and monitor risks.	http://www.tanfac.com/documents/ Risk-Management-policy.pdf
Dividend Distribution Policy	Recognising the need to lay down a broad framework for deciding the matters pertaining to distribution of dividend and/or retaining the profits of the Company, the Board of Directors the Company (the "Board") has laid down and adopted this policy.	http://www.tanfac.com/documents/ Tanfac - Dividend - Distribution policy. pdf. "

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Mr. Afzal Harunbhai Malkani (DIN: 07194226), Director is liable to retire by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

Mr. K. Send hi l Naathan, (DIN: 08850046) was appointed as Managing Director with effect from 27^th August, 2020 for a period of three years and the Board proposes to re-appoint him for further period of eighteen months with effect from 27th August, 2023 subject to approval of shareholders in this Annual General Meeting.

In terms of the provisions of Section 203 of the Act, Mr. K. Sendhil Naathan, Managing Director, Mr. N.R. Ravichandran, Chief Financial Officer and Mr. H. Narayanarao, Company Secretary are the Key Managerial Personnel of your Company.

DECLARATION BY INDEPENDENT DIRECTORS:

The Independent Directors of your Company have given their certificate of independence to your Company stating that they meet the criteria of independence as mentioned under Section 149(6) of the Companies Act, 2013. The details of the training and familiarization programmes and the Annual Board Evaluation process for Directors have been provided in the Corporate Governance Report.

The terms and conditions of appointment of Independents Directors, in line with the provisions of Schedule IV of the Companies Act, 2013 are available on the Company?s official website link viz.., http://www.tanfac.com/documents/who appointment independent directors.pdf

All Independent Directors of your Company have registered their name in the data bank maintained with the Indian Institute of Corporate Affairs, Manesar in terms of the provisions of the Companies (Appointment and Qualification of Directors) Rules, 2014.

BOARD EVALUATION:

The evaluation of Board of Directors and the Board, as required under Section 149 of the Companies Act, 2013, read with Schedule IV under Chapter VIII were done through selected parameters related to their roles, responsibilities and obligations of the Board and functioning of the Committee.

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the key function of the Board of Directors includes:

• To review and guide Corporate Strategy, major Plan of Action, Risk Policy, Annual Budgets & Business Plans, setting Performance Objectives.

• Monitoring the effectiveness of the Company?s governance practices;

• Ensuring the integrity of the Company?s Accounting and Financial Reporting Systems, including the Independent Audit;

• To provide strategic guidance;

• To maintain high ethical standards in the interest of the stakeholders;

• To exercise objective independent judgement on corporate affairs.

Accordingly, the performance of the Board was evaluated after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc. Similar evaluation was carried out by the Committee of the Board of Directors after seeking their inputs.

NUMBER OF MEETINGS OF THE BOARD:

During the Financial Year 2022-23, the Board met five times and further details are provided in the Report on Corporate Governance that forms part of this Annual Report.

The intervening gap between any two meetings was within the period as prescribed under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and MCA circulars thereon.

BOARD COMMITTEES:

Presently, the Board has four Committees, viz., Audit Committee, Nomination and Remuneration Committee, Stakeholders? Relationship Committee and CSR Committee comprising of the required combination of Non-Independent and Independent Directors. For further details, please refer to the Report on Corporate Governance section of the Annual Report.

Your Company has become a top 1000 Company with effect from 1^st April, 2023 based on the market capitalization of BSE as on 31st March, 2023. To comply with the listing requirement for top 1,000 Company, the Board, in its meeting held on 21st April, 2023, had duly constituted Risk Management Committee consisting of following Directors and Senior management:

1. Mr. Afzal Malkani, Chairperson of the Committee

2. Mr. M.R.Sivaraman

3. Mr. V.T.Moorthy

5. Mr. K.Sendhil Naathan

6. Mr. N.R.Ravichandran, Chief Financial Officer

Chief Financial Officer will act as the Chief Risk Officer (CRO).

ANNUAL RETURN:

Annual Return as required under Section 92(3), copy of Annual Return is placed on the Company?s website. The web link to access the annual return is https://tanfac.com/documents/ MGT-7-Annual-Return-2022-23.pdf

INTERNAL FINANCIAL CONTROL (IFC):

The Internal Financial control (IFC) stipulates a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

The observations by the Internal Auditors and corrective actions thereon are presented at the Audit Committee which also oversees and evaluates the IFC periodically.

The Directors Responsibility Statement required under Section 134(5) of the Companies Act, 2013, are available elsewhere in the Directors? Report.

CORPORATE GOVERNANCE:

Your Company is strongly committed towards its philosophy of Corporate Governance. The Corporate Governance Report, along with the Auditors certificate regarding compliance of the conditions of the Corporate Governance as stipulated in Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with Listing Agreement is forming part of the Annual Report.

A Certificate of the Managing Director and Chief Financial Officer of the Company, in terms of Regulation 17(8) as specified in Part B of Schedule II read with SEBI (LODR) Regulations, 2015, confirming the correctness of the Financial Statements, adequacy of the Internal Control measures and reporting of matters to the Audit Committee, is annexed.

Your directors are pleased to report that the Company has fully complied with the SEBI guidelines and Corporate Governance as on Financial Year ended 31st March, 2023 and will continue to comply with the same.

LISTING WITH STOCK EXCHANGES:

The Company is listed in The Bombay Stock Exchange of India Limited (BSE) and the Stock Code is 506854 & ISIN

INE639B01015. The Company confirms that it has paid the Annual Listing Fees for the year 2023-24 to BSE where the Company?s Shares are listed.

INSURANCE:

The Company?s properties, Fixed Assets (including Building, Plant and Machinery & other insurable assets) and Currents Assets (including stock of Raw Materials, Finished Goods, Stores and Spares etc.,) are adequately insured.

MANAGEMENT?S DISCUSSION AND ANALYSIS REPORT:

As required under Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with the Listing Agreement, the Management?s Discussion and Analysis Report (MD & A) for the year under review has been made & forming part of the Annual Report.

PERSONNEL:

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rules 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annual Report.

Particulars pursuant to Section 197(12) and the relevant Rules.

The information required under Section 197 of the Act and the Rules made thereunder, in respect of employees of the Company, is as follows:

a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year;

Apart from remuneration to the Managing Director as per terms of appointment approved by the members, except for sitting fees for attending meetings of the Board & Board Committees, no other remuneration is being paid to other Directors. For this purpose, Sitting fees paid to the Directors have not been considered as Remuneration.

Name of the Director	Ratio to median remuneration	Remuneration Paid (? In Lakhs)
Mr. K.Sendhil Naathan, Managing Director	29.03:1	191.33

b. The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary for the financial year 2022-23 and Ratio of remuneration of Director to the medium remuneration of the employees of the Company for the financial year is as under:

S.No	Particulars of Director and Other Key Managerial Personnel (KMP) and Designation	# Remuneration of Director and KMP for financial year 2022-23 (in Lakhs)	% increase in remuneration in financial year 2022-23	Ratio of remuneration of each Director to medium remuneration of employees
1	Mr. K.Sendhil Naathan, Managing Director	191.33	Nil	29.03:1
2	Mr. N.R.Ravichandran, Chief Financial Officer	80.04	Nil	Not Applicable
3	Mr. H.Narayanarao, Company Secretary	8.64	Nil	Not Applicable

c. The percentage increase in the median remuneration of employees in the financial year was 26%:

During the Financial year 2022-23, there was an increase of 23% over the previous financial year, in the Median remuneration of the employees. The calculation of percentage increase in the Median remuneration is based on comparable employees.

d. The number of permanent employees on the rolls of Company:

There were 131 permanent employees on the rolls of the Company as on 31^st March, 2023 (135 no. of employees as on 31st March, 2022).

e. Average percentile increases already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration

and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Average increase for Managing Director, Chief Financial Officer and the Company Secretary was at 53% compared to 14% increase considered for other Non-Managerial Personnel.

f. Affirmation that the remuneration is as per the remuneration policy of the Company:

It is hereby affirmed that the remuneration paid to employees is as per the Group HR Policy duly adopted by the Company through its Nomination and Remuneration Committee.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014, is available for inspection in electronic mode. Any Member interested in obtaining a copy of the same may write to the Company.

INDUSTRIAL RELATIONS:

Employee relations continued to be cordial throughout the year. The whole-hearted support of employees in the implementation of ISO-9001 systems, ISO 14001, ISO 45001 in energy contribution initiatives and amply demonstrates the high level of teamwork, sense of belonging to the organization, and solidarity with the Management.

RESEARCH AND DEVELOPMENT:

Your Company has made the following efforts in Research & Development:

• Your Company is in advance stage of monitoring the R&D/ Pilot Plant facility.

• Your R&D will focus on Process development of Fluorinated Specialties through AHF fluorination.

• R&D Engineers have successfully utilized waste heat to dry fluorspar & distillation process.

• Your R&D Engineers have developed innovative & Reliable design of Heat exchanger for DHF process.

• Your R&D Engineers put continuous efforts to improve the reactivity in AHF process so as to reduce the consumption norms.

Your R&D Team implemented innovative ideas to increase the productivity of Sulphuric acid, KF and AHF.

• Continuous efforts and out of box thinking by Engineers towards Energy conservation measures have resulted in year to year (YOY) reduction in Average Power and Fuel Costs.

• Your Company has introduced IOT and Energy Management system in various plant locations/ operations.

SAFETY, HEALTH AND ENVIRONMENT PROTECTION (SHE):

Your Company is committed to Safety, Health and Environmental Management System and processes.

Your Company has an Integrated Management System (IMS) Certified by Intertek Certification Limited, UK for ISO 9001-2015-Quality Management System (QMS), ISO14001- 2015 -Environmental Management System (EMS) and ISO 45001:2018 for Occupational Health and Safety Management Systems.

As your Company is located in Coastal location & Chemical Complex, Company continues to do considerable spending on improving the stability of the Building and Structural? s, replacement of pipe lines through predictive maintenance, revamping of Cable Trays, Pipe racks and replacement of MCC panels with latest LOTO features.

Your Company focusses on improving the process Safety aspects such as introduction of Remote Operated Valves in AHF storage Tank farm, installation of PLC in Batch Operated plants, Automatic stop valve and online respiratory system in filling areas.

SHE & Operations Team in view of various process Improvement & Energy saving Schemes implemented, revised the P& Id of all plants and reconducted Hazop Study.

In Acid transfer lines introduced Double armoured pipe in place of normal pipelines.

Your Company is practicing the Safety procedures and Permit to Work system in line with international Systems & Practices.

You Company ensures stringent implementation of Safety and Environment Protection measures and the Board has mandated accordingly. Safety visuals, pictorials and sign boards are implemented across the plant areas.

Your Company Periodically Conducts Safety Audit and Risk Assessment to monitor risks and to have action plan for countering the risks. Your Directors also periodically reviews the safety Performance.

Your Company periodically conducts onsite mock drills and actively coordinates with the local Government and other nearby companies & customers.

Your Company continually conducts training and retraining on safety and sustainability aspects and rewarded employees and contract workmen who have significantly contributed towards sustainable development.

In line with Tamil Nadu Government Vision 2023 "Green Tamil Nadu Mission" your Company has increased the green belt coverage both inside and outside of the factory premises.

Sustainability:

Sustainability is built in as a core element of our business and strategy. The chemical industry is one of the leading emitters of direct GHG emissions across the world. Understanding this, your Company has prioritized the need for Energy savings and reduction in GHG emissions from plant operations.

This is being achieved through increased investments in more efficient technologies, reduction in energy consumption, and the use of alternative sources of energy to reduce overall GHG emissions.

With Continued efforts in Environment, Health & Safety aspects, we show our progress, performance and practices adopted with respect to environment, social and governance related aspects and future goals and targets as a part of the sustainability journey road map.

Your Company has proactively prepared Business Responsibility Sustainability Report (BSSR) for FY-23 as per the National Guidelines on Responsible Business Conduct (NGRBC) and with the United Nations Guiding principles on Business & Human Rights (UNGPs).

MANAGEMENT POLICY:

We at TANFAC Industries Limited are committed to continual improvement of the processes of Management System affecting Quality, Cost, and Delivery along with Environmental Impact to prevent pollution and to comply with requirements of customers and interested parties and public.

SUSTAINABLE DEVELOPMENT - COMMUNITY DEVELOPMENT INITIATIVES - CORPORATE SOCIAL RESPONSIBILITY (CSR):

CSR is a continuing commitment by business to behave ethically and contribute to economic development of the local community and society at large. Creating value for the society is one of the major initiatives of CSR.

In terms of the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors of your Company has constituted a Corporate Social Responsibility ("CSR") Committee chaired by Mr. V.T.Moorthy, Independent Director. Other Members of the CSR Committee are Mr. M.R.Sivaraman, IAS Retd., Independent Director, Mrs. R.Rajalakshmi, Independent Director, Mr. R. Karthikeyan, Non-Executive and Non-independent Director (upto 24 ^th March, 2023) and Mr. Afzal Harunbhai Malkani, Non-Executive Director (with effect from 21^st April, 2023).

Your Company also has in place a CSR Policy which is available at - TANFAC-CSR-Policy.pdf .

Your Company?s CSR activities are focused on Social Empowerment and Welfare, Infrastructure Development, Sustainable Livelihood, Healthcare and Education. Various activities across these segments have been initiated during the year around the plant location, neighboring villages around Cuddalore and Cuddalore District.

Focused areas are Education, Health, Sustainable Livelihood, Infrastructure development and social empowerment. All our CSR activities are carried out under the support and guidelines of Anupam Group for Community Initiatives and Rural Development. Your company is carrying out its community welfare activities in and around Cuddalore for more than a decade to underserved communities even when it was not under the ambit of CSR obligation.

Your Company motivates and encourages its employees to actively participate in the various community development and CSR activities.

During the year ? 79.07 lakhs was spent on CSR activities which is more than the obligation of 2% of the average net profits of the last 3 financial years.. A detailed report on CSR initiatives is annexed as Annexure ‘C? to this report.

OTHER DISCLOSURES

• No Material changes and Commitments affected the financial position of your Company between the end of the financial year and the date of this Report.

• Your Company has not issued any shares with differential voting rights.

• There was no revision in the financial statements.

• There has been no change in the nature of business of your Company. ^•

• Your Company has not issued any sweat equity shares.

• Though the Company become top 1000 listed company of BSE for the financial year 2023 -24, the Company opts to voluntarily include Business Responsibility and Sustainability Report (BRSR) for the financial year 2022-23. Please refer Annexure D to the Board Report.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:

Your Company has zero tolerance for sexual harassment at workplace. The Company has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act) and the Rules framed thereunder. Your Company has complied with provisions relating to the constitution of Internal Complaints Committee under the POSH Act. During the year under review your Company did not receive any complaint of sexual harassment.

HUMAN RESOURCES DEVELOPMENT:

Human resources play a significant role in your Company?s growth strategy. Your Company believes that its knowledge capital will drive growth and profitability. The ongoing focus is on attracting, retaining and engaging talent with the objective of creating a robust talent pipeline at all levels. Your Company?s Employee Engagement Score reflects high engagement and pride in being part of the organization.

Corporate Human Resources plays a critical role in your Company?s talent management process. Initiatives like robust talent reviews, career development conversations and best- in-class development opportunities will help enhance the employee experience at your Company.

Your Company is engaged in a constructive relationship with employees with an emphasis on productivity and efficiency and underlining safe working practices. As on 31st March, 2023, your Company?s employee strength was 131 employees (previous year 135 employees).

CAUTIONARY STATEMENT

Statements in the Board?s Report and the Management Discussion and Analysis describing your Company?s objectives, projections, estimates, expectations or predictions and plans may be ‘forward looking statements? within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Company?s operations include global and Indian demand- supply conditions, sales realizations, feed stock prices, cyclical demand and pricing in the Company?s principal markets, changes in government regulations, tax regimes, economic developments within India and the countries within which your Company conducts business, geopolitical tensions, risks related to an economic downturn or recession in India, the ongoing efforts of the government and other factors. Your Company is not obliged to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent development, information or events, or otherwise.

ACKNOWLEDGEMENT:

Your directors wish to express their appreciation for the continued assistance and cooperation of the consortium banks, Government authorities, customers, vendors and members during the year under review.

On behalf of the Directors and all shareholders, I would like to place on record my sincere appreciation of the committed services by the entire TANFAC family, comprising officers, staff and workers.

Finally, I look forward to your continued understanding and support in taking your Company forward in these challenging times.

	For and on behalf of the Board
Place: Chennai	(Mariam Pallavi Baldev)
Date: 17th July, 2023	Chairperson