Welspun Specialty Solutions Ltd Directors Report

To,

The Members,

Welspun Specialty Solutions Limited

(Formerly known as RMG Alloy Steel Limited)

Your Directors are pleased to present the Forty-Second Annual Report together with Audited Financial Statement of the Company for the year ended 31st March 2024.

1. FINANCIAL RESULTS

(Rs. in Lakhs)

Particulars	2023-24	2022-23
Sales and other income	71,817	43,259
Profit/(Loss) before interest, depreciation and exceptional items	7,733	3,149
Interest and Financial charges	3,325	3,031
Depreciation and Amortization	1,548	1,491
Profit/ (Loss) before exceptional items and tax	2,860	(1,374)
Profit/(Loss) before tax	2,860	(1,374)

2. OPERATIONS

Operations of the Company were as under:

Particulars	2023-24 Production Sales Gross Sales (Qty M.T.) (Qty M.T.) (Rs.in Lakhs)			2022-23
				Production (Qty M.T.)	Sales (Qty M.T.)	Gross Sales (Rs.in Lakhs)
Pipe	4,683	4,785	25,294	4,541	4,059	21,390
Steel	28,439*	15,903	43,762	16,985*	6,869	20,094
Others	-	-	611	-	-	299
Total	33,122	20,688	69,667	21,526	10,928	41,783

*Includes produced for Captive Consumption

By pursuing a well-defined business transformation strategy, the Company could achieve a complete turnaround during FY24 witnessing first year of consistent profitability.

During FY24, the Company faced many challenges, especially in the exports markets due to tough macro-economic scenarios viz. high inflation, higher interest rates leading to low optimism, rising geo political tensions and regional conflicts etc. Against this backdrop, the Company could make its successful foray into the USA markets backed by consistent focus to expand in new large geographies. The Company continue to receive encouraging product acceptance in terms of wide grade & size ranges, resulting into adding new customers as well as enhancing business with existing customers.

The domestic market opportunity also remains of an extremely high focus and priority for the Company. Given the right policy interventions, continued spending by the Government on infrastructure, energy and other strategic sectors, and the preference accorded to the domestic manufacturing industry, India focus remains integral to overall growth strategy of the Company. As a continuing endeavor, company remained highly focused on Research and Product Development thus successfully rolling out new grades / products in the market.

Major highlights of FY24:

• Many high value grades developed and delivered during the year e.g. 904L, S30432, Alloy 800/H, Alloy 625, Low Cobalt Steel for Nuclear Power, Hollow Bars, Welsonic 50 etc.

• Qualified by BHEL and NTPC for super critical boiler tubes of grade S30432 for first time to an indigenous integrated facility.
• Geography and territory expansion continued with 45 new customer additions
• Share of renewable electricity improved to 25% on an average for the full year

As the company scales up the business gradually, management focus continues to be on penetrating into newer markets, customer acquisition, developing and delivering new, value added and critical products. The Company also has been focusing on strategic tie ups and securing more approvals and accreditations.

Strong focus will also remain on sustainability. The Company has been increasing its share of renewable energy and also reducing carbon emission gradually.

1. SHARE CAPITAL

The Authorised Share Capital of the Company as on March 31, 2024 was Rs.565,00,00,000/- (Rupees Five Hundred Sixty Five Crore Only) divided into 55,00,00,000 (Fifty Five Crore) Equity shares of Rs.6/- (Rupees Six Only) each and 23,50,00,000 (Twenty Three Crore Fifty Lakh) Preference Share of Rs.10/- (Rupees Ten Only) each. The issued, subscribed and paid up share capital of the Company stood at Rs.368,95,77,646/- (Rupees Three Hundred Sixty Eight Crore Ninety Five Lakh Seventy Seven Thousand Six Hundred Forty Six only) as at March 31, 2024 comprising of 53,00,89,156 (Fifty Three Crore Eighty Nine Thousand One Hundred Fifty Six) equity shares of Rs.6/- (Rupees Six Only) each fully paid up and 5,09,04,271 (Five Crore Nine Lakh Four Thousand Two Hundred Seventy One) preference shares of Rs.10/- (Rupees Ten Only) each fully paid up. There was no change in the issued, subscribed and paid up share capital during the year under review.

2. DIVIDEND

With a view to maintain sufficient funds for working capital and growth of business, your Directors do not recommend any dividend for the financial year ended on March 31, 2024.

3. DIVIDEND DISTRIBUTION POLICY

In terms of the Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "SEBI Listing Regulations"), the Board of

Directors approved and adopted Dividend Distribution Policy of the Company setting out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to the shareholders and/ or retaining the profits earned by the Company. The Policy is annexed to this Report as ‘Annexure I and is also available on the Companys website at https://welspunspecialty.com/policy.php.

4. TRANSFER TO RESERVE

During the year under review, the Company did not transfer any amount to the general reserve.

5. SUBSIDIARIES, ASSOCIATE AND JOINT VENTURES COMPANIES

The Company does not have subsidiary, associate and joint ventures companies.

6. NET WORTH STATEMENT

The Companys financial statements has been prepared as per Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 (the "Act") read with the Companies (Indian Accounting Standards) Rules, 2015. As per the Ind AS, Redeemable Preference Share Capital is shown as borrowing in the financial statement. However, as per Sections 2(57), 2(64) and 43 of the Act, the definition of Net Worth includes ‘paid- up share capital i.e. equity share capital and preference share capital. Therefore, for the purpose of calculation of Net Worth, redeemable preference share capital is also considered as a part of the Net Worth.

(Rs. in Lakhs)

Particulars	31.03.2024	31.03.2023
Equity Share Capital	31,805	31,805
Securities premium collected on Equity Share Capital	28,849	28,849
Redeemable Preference Share Capital	1,867	1,666
Redeemable Preference share capital adjustment account	3,775	3,775
Retained Earnings	(55,718)	(61,952)
General Reserve	553	553
Net Worth	11,131	4,696

7. DIRECTORS/ KEY MANAGERIAL PERSONNEL (KMP)
1. Board of Directors:

In accordance with the provisions of the Act, and the Articles of Association of the Company, Mr. Vipul Mathur (DIN:07990476), Non-Executive Non-Independent Director, will retire by rotation at the 42nd Annual General Meeting and being eligible, has offered himself for re-appointment. The Board has recommended his re-appointment.

During the year under review, there was no change in the Directors of the Company.

2. Key Managerial Personnel:

During the year under review, there was no change in the Key Managerial Personnel of the Company.

3. Declaration by Independent Directors:

The Company has received declarations from each Independent Director as per the provisions of Section 149 (7) of the Act and the Regulation 25(8) of the SEBI Listing Regulations, as amended from time to time, confirming he / she meets the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16 of the SEBI Listing Regulations. There has been no change in the circumstances as on the date of this Report which may affect his / her respective status as an Independent Director.

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise and they hold highest standard of integrity.

All the Independent Directors on the Board of the Company are registered with the Indian Institute of Corporate Affairs, Manesar, Gurgaon as notified by the Central Government under Section 150(1) of the Act. As per the proviso to Rule 6(4) of the Companies (Appointment and Qualification of Directors) Rules, 2014, the Independent Directors of the Company shall undergo online proficiency self-assessment test, as may be applicable, within the time prescribed by the IICA.

4. Annual Evaluation of Board, its Committees and Directors :

The performance evaluation of the Board of Directors, its Committees and of Individual Directors were conducted by the entire Board (excluding

the Director being evaluated) on the basis of a structured questionnaire which was prepared after taking into consideration SEBIs guidance note on board evaluation and inputs received from the Directors, covering various aspects of the Boards functioning viz. adequacy of the composition of the Board and its Committees, time spent by each of the Directors; accomplishment of specific responsibilities and expertise; conflict of interest; integrity of the Director; active participation and contribution during discussions and governance.

For the financial year 2023-24, the annual performance evaluation was carried out by the Independent Directors, the Nomination and Remuneration Committee and the Board, which included evaluation of the Board, Independent Directors, Non-Independent Directors, Executive Directors, Chairman, Committees of the Board, Quantity, Quality and Timeliness of Information to the Board. All the results were satisfactory to the Board.

5. Meetings of the Board of Directors:

Five (5) meetings of Board of Directors were held during the financial year 2023-24, the details of which are given in point 2(b) of the "Corporate Governance Report" annexed to this Report as ‘Annexure III.

6. Committees of the Board of Directors

Information on the Audit Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee, the Risk Management Committee, as applicable, and meetings of those committees held during the year under review is given in the "Corporate Governance Report" annexed to this Report as ‘Annexure III.

There have been no instances where the Board did not accept the recommendations of its committees, including the Audit Committee.

8. DISCLOSURE AS PER SECTION 197(12) AND RULE 5 (1) OF COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014:

The Independent Directors are paid sitting fees at a fixed rate per meeting of the Board or the Committee attended by them and as such the same cant compare with the remuneration to the employees.

(i)	the ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year	Ratio in case of Mr. Anuj Burakia, CEO& WTD is 1:74
(ii)	the percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:	Anuj Burakia	CEO& WTD	49.72%
		Brijveer Singh	CFO	77.82%
		Suhas Pawar	CS	18.13%
(iii)	the percentage increase in the median remuneration of employees in the financial year:	Median remuneration decreased by 0.97%.
(iv)	the number of permanent employees on the rolls of company	643 as on March 31, 2024.
(v)	average percentile increase 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:	The average increase in remuneration of employees excluding KMP in last financial year was 11.58%. The remuneration of the CEO & Whole Time Director and the CFO is decided based on the individual performance as well as performance of the Company, inflation, prevailing industry trends and benchmarks.
(vi)	Affirmation that the remuneration is as per the remuneration policy of the Company.	Remuneration paid during the year ended March 31, 2024 was as per the Remuneration Policy of the Company.

9. PARTICULARS OF EMPLOYEES

The details of employees of the Company drawing remuneration as prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is as follows:

Sr. No.	Name	Designation	Remuneration Drawn During The Year (Rs.)	Nature of Employment	Qualification	Experience (Years)	Date of Commencement of Employment	Age	Last Employment	% of Equity Shares	Relative
1	Anuj Burakia	CEO & Whole Time Director	2,58,54,028	Contract	Chartered Accountant	22	29-July-21	45	Welspun Group	0.20%	No
2	Vipul Sutaria	President	1,28,76,550	Permanent	BE - Mechan- ical, PGDBM Marketing	24	11-Oct-21	50	Saarloha (Erstwhile Kalyani Carpenter)	NIL	No
3	Narendra Kumar Bhandari*	President	61,54,617	Permanent	Chartered Accountant	22	25-Sep-09	63	Fata Tanning	0.00%	No
4	MV Rajasekhar	Assistant Vice President	68,76,953	Permanent	M. Sc (Tech), M.M.S.	30	09-Jun-22	55	Tubacex Prakash India Ltd	NIL	No
5	Brijveer Singh	Vice Presi- dent	63,72,843	Permanent	Chartered Accountant	27	02-May-22	53	Afri Ventures FZE	NIL	No
6	Nityanand Shukla*	Vice Presi- dent	42,34,842	Permanent	B.Sc, BE - Me- chanical, MBA	35	11-Oct-21	57	Bhawani Industries Pvt Ltd	NIL	No
7	Anil Kumar Singh Rana	Assistant Vice President	56,43,282	Permanent	BE - Electrical	20	05-May-10	54	Star Wire (In- dia) Limited	NIL	No
8	Gouri Shankar Roy*	Senior Vice President	49,66,120	Permanent	B.Sc Mechan- ical Engineer- ing, PGDBA in Operations Management	30	11-Nov-23	54	Timkens Mill- Tec business managing 26 mill sites	NIL	No
9	Manas Ranjan Dash	Assistant Vice President	43,18,345	Permanent	BA, LLB, PGD in HRD	29	29-Nov-19	54	Enzen Group	NIL	No
10	Avadhesh Kumar Porwal	Senior Gen- eral Manager	41,82,428	Permanent	Diploma - Me- chanical	26	09-Oct-17	55	Welspun Corp Limited	NIL	No
11	Saubhag Sharma	General Manager	32,20,164	Permanent	Chartered Accountant		02-Jan-12	34	-	NIL	No

* resigned / discontinued / employed for part of or during the year.

Remuneration policy and criteria for making payment to Non-Executive Directors:

Pursuant to Section 178 (3) of the Act and provisions of SEBI Listing Regulations, the Nomination and Remuneration Committee (NRC) and the Board of Directors at their respective meetings held on 5th February, 2019 had approved and recommended a revamped policy relating to criteria for determining qualifications, positive attributes and Independence of Directors, the remuneration for the Directors, Key Managerial Personnel and other employees.

For the Companys policy on Directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided under Sub-section 3 of Section 178 of the Act, please refer to the Para of the "Corporate Governance Report" annexed to this Report as ‘Annexure III.

10. EMPLOYEE STOCK OPTIONS

The Company have not granted stock options during the year under review, the disclosures as required under Regulation 14 of the SEBI (Share Based Employee Benefits And Sweat Equity) Regulations, 2021 and Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 are as under:

(I) A description of each ESOS that existed at any time during the year, including the general terms and conditions of each ESOS, including -
(a) Name of the ESOP Plan	RMG Alloy Steel Ltd Employee Stock Options (Senior Management Personnel) Scheme 2018
(b) Date of shareholders approval	15.05.2018
(c) Total number of options approved under ESOS	20,00,000
(d) Vesting requirements	The Vesting of ESOPs shall happen at every anniversary of the date of grant in quantum of 35% and 35% of the total ESOPs granted for the first 2 years and 30% of the total ESOPs granted shall vest on completion of 2 years 3 months from the date of grant*
(e) Exercise price or pricing formula	Nil
(f) Maximum term of options granted	Upto the third anniversary from the date of Vesting
(g) Source of shares (primary, secondary or combination)	Primary
(h) Variation in terms of options	-
(II) Method used to account for ESOS - Intrinsic or fair value.	Fair Value
(III) Where the company opts for expensing of the options using the intrinsic value of the options, the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the company shall also be disclosed.	Not Applicable
(IV) Option movement during the year
Number of options outstanding at the beginning of the period	Nil
Options granted	Nil
Options vested	Nil
Options exercised	Nil
The total number of shares arising as a result of exercise of option	Nil
Options forfeited / lapsed	Nil
The exercise price	Nil
Money realized by exercise of options	Nil

Certificate from M/s. JMJA & Associates LLP, Company Secretaries, Secretarial Auditors of the Company with respect to the implementation of Welspun Employee Stock Option Scheme would be placed before the Members at the ensuing Annual General Meeting of the Company and a copy of the same shall be available for inspection at the Registered office of the Company.

1. DEPOSITS

The Company has not accepted any deposit within the meaning of Chapter V to the Act. Further, no amount on account of principal or interest on deposit was outstanding or unclaimed or unpaid as at the end of the financial year under the Report.

2. ANNUAL RETURN

Pursuant to Sections 92 and 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return in form MGT-7 is placed on the website of the Company and can be accessed at https://www.welspunspecialty.com/notice.php.

3. DETAILS OF RELATED PARTY TRANSACTIONS

All transactions entered into by the Company with related parties were in the ordinary course of business and at arms length basis. The Audit Committee grants an omnibus approval for the transactions that are in the ordinary course of the business and repetitive in nature. For other transactions, the Company obtains specific approval of the Audit Committee before entering into any such transactions. For material related party transaction, the Company obtains prior approval of the Members of the Company. A statement giving details of all Related Party Transactions is placed before the Audit Committee on a quarterly basis for its review. The disclosure of Related Party Transactions as required in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 in Form AOC -2 is not applicable for this year.

The Companys policy on Related Party Transactions as approved by the Board is uploaded on the Companys website https://www.welspunspecialty.com/policy.php

Save and except as disclosed in the financial statements, none of the Directors had any pecuniary relationships or transactions vis-?-vis the Company.

Pursuant to Regulation 34 read with Schedule V of the SEBI Listing Regulations, please refer Note no.39 for details of related party transactions.

4. AUDITORS AND THEIR REPORTS Statutory Auditors:

M/s. Price Waterhouse Chartered Accountants LLP (‘PWCAL), Chartered Accountants (Firm Registration No. 012754N/N500016) were appointed as the Statutory Auditors of the Company, to hold office for a period of 5

(five) years from the conclusion of 40th Annual General Meeting till the conclusion of 45th Annual General Meeting of the Company, in terms of the provisions of Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014.

The Audit Report did not contain any qualifications, reservations, adverse remarks or disclaimers and no fraud was reported by the Statutory Auditors of the Company to the Audit Committee pursuant to Section 143(12) of the Act.

Internal Auditors:

Based on the recommendation of the Audit Committee, the Board of Directors appointed M/s. Deloitte Touche Tomastu India LLP as the Internal Auditors of the Company for the financial year 2024-25.

M/s. KPMG Assurance and Consulting Services LLP were appointed as the Internal Auditors of the Company for the financial year 2023-24.The internal audit was completed as per the scope defined by the Audit Committee.

Cost Auditors:

The Company maintains cost records as specified by the Central Government under sub-section (1) of Section 148 of the Act. As per Section 148 of the Act, the Board of Directors have appointed M/s. Kiran J. Mehta & Co, Cost Accountants, (Firm Registration No.000025) as the Cost Auditors for the financial year 2024-25 at a remuneration of Rs.65,000/- p.a. on the recommendations of the Audit Committee.

The Board recommends ratification of the remuneration payable to the Cost Auditors for the year ending on March 31, 2025 by the Members at the ensuing Annual General Meeting.

The Cost Auditors Report did not contain any qualifications, reservations, adverse remarks or disclaimers and no frauds were reported by the Cost Auditors to the Company pursuant to Section 143(12) of the Act. The Cost Audit Report for the financial year 2022-23 was e-filed on September 29, 2023. The Cost Audit Report for the financial year 2023-24 is in progress and the report will be filed with the Ministry of Corporate Affairs, Government of India, within the statutory timeline.

Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. JMJA & Associates LLP, Practicing Company Secretaries,

has been appointed as the Secretarial Auditors of the Company for the financial year 2024-25. The Secretarial Audit Report issued by the Secretarial Auditors for the financial year 2023-24 is annexed herewith as ‘Annexure II to this Report.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remarks and no frauds were reported by the Secretarial Auditors to the Company under Section 143(12) of the Act., except the reporting on filing of compounding application by the Company with respect to non-filing of cost audit report for the financial year 2018-19, as reproduced herein below and which in the opinion of the Board self-explanatory and does not require further explanation:

"The Company and the CEO& Whole Time Director have paid the compounding fees as per the Order of the Regional Director bearing No. RD(NWR)/441/Sec.148/01/2023-24 for compounding of offence committed under Section 148 of the Companies Act, 2013."

5. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186.

The Company has not made any investment nor given any loan or provide any guarantee / security for repayment of loan under Section 186 of the Act.

6. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES

The Board has adopted vigil mechanism in the form of Whistle Blower Policy, to deal with instances of fraud or unethical behavior or misconduct etc. For the Companys policy on establishment of Vigil Mechanism for Directors and Employees, please refer to the point no.13 (iii) of the "Corporate Governance Report" annexed to the Directors Report as ‘Annexure III.

The details of Whistle Blower Policy and Vigil Mechanism is also available on the Companys website at https://www.welspunspecialty.com/policy.php.

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

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo required pursuant to the Rule 8(3) of the Companies (Accounts) Rules, 2014 are given below.

During year under review, the Company has taken various initiatives to conserve energy and improve technology

being used for production as discussed in detail hereunder. This has helped the Company in its journey on moving up the value chain.

1. Conservation of Energy
1. the steps taken or impact on conservation of energy;

The following are measures taken during the year under review:

• Replaced the existing shed lights with energy efficient LED lighting and all new requirements met with LED.
• Installed timing based controller to operate the external lighting in portion of plant. Balance under implementation.
• Replaced two main water complex pumps with

energy efficient pumps.

• VFD installed at Bar peeling machine for energy optimisation.
• Power manager (auto controller) for optimum allocation of power to production units thereby conserving energy as well as ensuring optimum production.
1. the steps taken by the company for utilizing alternate sources of energy;

The Company has signed agreement for procurement of hybrid (solar + wind) power supply. In the financial year 2023-24, the Company utilised 24 % Hybrid units against total power consumption.

2. the capital investment on energy conservation equipment;

Energy conservation equipment were added to the production facility during the year under review with approximate cost Rs. 6 Lakhs.

1. Technology Absorption:
1. the efforts made towards technology absorption;
• Mould Oscillation Table changed with variable stroke for casting quality improvement.
• Recipe based programme developed and implemented on caster to reduce human dependency.
• AMLC upgradation in progress to achieve precise mould level controls and quality of blooms.
• Robotics installation at extrusion press - In Progress.
• Servo Motors installed in 4.5" Pilger with PLC and HMI.
• Upgradation of Immersion UT Machine Electronics.
• Hot Air Blower Installed for Tube Drying.
• Online Environment Monitoring System Installed.
• Two new sewage Treatment Plants Installed.
1. the benefits derived like product improvement, cost reduction, product development or import substitution;
• Transfer process of Billets to extrusion modification under process from manual to Robotic.
• 400 Dia ingot Casting to improve centre looseness.
• 250 Dia Rolling to cater improve product mix.
• Hollow Bar Extrusion initiated to improve market penetration.
2. in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-

Upgradation of Auto Mould Level Control at caster.

3. the expenditure incurred on Research and Development.

The products and process development are undertaken by the Company internally.

1. Capacity Enhancement & Technological Upgradation:
• Additional bar cutting machines at Rolling Mill.
• Additional honing Machine installed to augment production capacity.
1. Foreign exchange earnings and outgo
1. Foreign exchange earned in terms of actual

inflows during the year;

FOB Value of exports Rs. 25,724 Lakhs (Previous Year Rs. 15,266 Lakhs).

2. Foreign exchange outgo during the year in terms

of actual outflows;

Imports on CIF Basis/expenditure in foreign currency Rs. 11,862 Lakhs (Previous Year Rs. 4,802 Lakhs).

1. CORPORATEGOVERNANCEREPORTAND MANAGEMENT DISCUSSION AND ANALYSIS

In compliance with Regulation 34 of the SEBI Listing Regulations, a separate report on Corporate Governance is annexed hereto as a part of this Report as ‘Annexure III. A certificate from the Secretarial Auditors

of the Company regarding compliance of conditions of Corporate Governance as prescribed under the SEBI Listing Regulations is attached to this report as ‘Annexure IV. Management Discussion and Analysis is separately given in this Report as ‘Annexure VI.

2. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Company has provided the Business Responsibility and Sustainability Report on voluntary basis which is annexed hereto as ‘Annexure VII.

3. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, your Directors, based on the representations received from the Operating Management, and after due enquiry, hereby confirm that:

1. in the preparation of the annual accounts for the financial year ended March 31, 2024, the applicable accounting standards had been followed along with proper explanation relating to material departures;
2. the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 31st March 2024 and of the profit and loss of the Company for that period;
3. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
4. the directors had prepared the annual accounts on a going concern basis;
5. the directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and
6. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
1. RISK MANAGEMENT

The Company has constituted a Risk Management Committee in compliance with the SEBI Listing

Regulations. The details of this Committee and its terms of reference are set out in the Corporate Governance Report.

The Board has approved Risk Management Policy (RMP) to effectively address financial, operational, compliance and strategic risk. A structured enterprise risk management program has been formulated and implemented. The Risk Management Committee was formed and adopted its charter to periodically review the risk management process, risks and mitigation plans and provide appropriate advise in the improvement areas, if any, identified during the review.

Please refer to point C of the Management Discussion and Analysis section attached to this Report for risks and threats relevant to the Company.

2. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTOR

The details of familiarization programme conducted for Independent Directors are disclosed on the website of the Company at link: https://www.welspunspecialty.com/policy.php. More than 3 hours were spent by the Independent Directors cumulatively in several familiarization program during the year under review.

3. CODE OF CONDUCT

The Company has a Code of Conduct for Board members and Senior Management Personnel. A copy of the Code has been put on the website of the Company for information of all the members of the Board and Senior Management Personnel at https://www.welspunspecialty.com/policy.php. Each Director and Senior Management Personnel including all functional heads, to which this code has been made applicable, have affirmed their compliance with the Code. A declaration by Mr. Anuj Burakia, CEO & Whole Time Director, to this effect given in the Corporate Governance Report forms part of this report.

4. PROHIBITION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

In compliance with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has put in place a Policy on Prohibition and Prevention of Sexual harassment of women at the workplace.

The Company has complied with the provisions relating to constitution of Internal Complaint Committee ("ICC") under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. The ICC comprises of internal as well as external members.

Disclosure of number of complaints filed, disposed of and pending in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 as on the end of the financial year under Report are as under:

Number of complaints pending at the beginning of the financial year	Nil
Number of complaints received during the financial year	Nil
Number of complaints disposed of during the financial year	Nil
Number of complaints pending as on end of the financial year	Nil

5. INTERNAL FINANCIAL CONTROLS

The Company has adequate internal control system, which is commensurate with the size, scale and complexity of its operations. The Company has designed and implemented a process driven framework for Internal Financial Controls ("IFC") within the meaning of the explanation of Section 134(5)(e) of the Act, the SEBI Listing Regulations and other relevant statutes applicable to the Company. The executive management and Internal Auditors continuously monitors the efficiency of the internal controls / compliance, with the objective of providing to the Audit Committee and the Board of Directors, an independent, objective and reasonable assurance of the adequacy and effectiveness of the organizations risk management, control and governance processes. For the year ended March 31, 2024, the Board is of the opinion that the Company has sound IFC commensurate with the nature of its business operations; wherein adequate controls are in place and operating effectively and no material weakness exists. Also refer paragraph under caption "internal control system" in Management Discussion and Analysis forming part of this report.

The Internal Audit is carried by independent external audit firm consisting of qualified accountants, domain & industry experts, fraud risk and information technology specialists.

6. MISCELLANEOUS

The Board of Directors affirms that the Directors have

devised proper systems to ensure compliance with the

provisions of all applicable Secretarial Standards issued by the Institute of Companies Secretaries of India and that such systems are adequate and operating effectively. The Company has complied with the applicable Secretarial Standards.

The Company has not made any provision of money for the purchase of, or subscription for, shares of the Company or its holding company, to be held by or for the benefit of the employees of the Company and hence the disclosure as required under Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is not required.

During the year under review,

• There was no change in the general nature of business of the Company;
• No material change or commitment has occurred which would have adversely affected the financial position of the Company between the end of the financial year to which the financial statements relate and the date of this report;
• No share with differential rights was issued by the Company nor did the Company issue any equity share as sweat equity share;
• No fraud took place in the Company during the year under review and hence, no such reporting was made to the Audit Committee and the Board under Rule 13(3) of the Companies (Audit and Auditors) Rules, 2014;
• No significant and material order was passed by the regulators or courts or tribunals which would have impacted the going concern status and the Companys operations in future;
• There was no revision in the financial statements.
• There was no instance of one-time settlement with any Bank or Financial Institution.
• There are no agreements defined under clause 5A of paragraph A of part A of schedule III of the SEBI Listing Regulations that are binding on the Company.
• No application was made or proceeding initiated against the Company under the Insolvency and Bankruptcy Code, 2016, nor any such proceeding was pending at the end of the financial year under review.
1. SAFETY

The Company conducts regularly Safety audit through competent authorities for its manufacturing facility located at Jhagadia, Bharuch, Gujarat. The Company also organizes various safety awareness programs to impart safety training to its employees.

2. ACKNOWLEDGEMENT

Your Directors take this opportunity to express gratitude for valuable assistance and cooperation extended to the Company by financial institutions, banks, statutory and regulatory authorities, customers, suppliers and other agencies engaged with the Company. Your Directors also wish to place on record their sincere appreciation of the dedicated services, hard work, solidarity and profuse support by all the employees of the Company.

For and on behalf of the Board of Directors Balkrishan Goenka Anuj Burakia

Chairman CEO & Whole Time Director

DIN: 00270175 DIN: 02840211

Place: Mumbai Date: April 26, 2024