Windlas Biotech Director Discussions


To,

The Members,

Your directors have pleasure in presenting the 22nd Annual Report on the business and operations of the Company, together with the audited accounts for the financial year ended March 31, 2023.

FINANCIAL RESULTS

The Audited Financial Statements of your Company as on March 31, 2023, are prepared in accordance with the relevant applicable Indian Accounting Standards ("Ind AS") and Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and the provisions of the Companies Act, 2013 ("Act"): Financial performance of the Company is summarised in the table below:

Particulars

Standalone

Consolidated

2022-23 2021-22 2022-23 2021-22
Revenue from Operations including other Income 5,230.48 4,726.36 5,230.48 4,726.36
Less Expenses:
Cost of goods sold 3,254.48 3,028.15 3,254.48 3,028.15
Employee benefits Expenses 703.21 634.08 703.21 634.08
Finance cost 7.86 14.17 7.88 14.17
Depreciation and Amortisation expenses 123.64 121.47 123.64 121.47
Other Expenses 570.73 468.11 570.89 472.83
Total Expenses 4,659.91 4,265.99 4,660.09 4,270.71
Profit before exceptional items and tax 570.57 460.37 570.39 455.65
Profit before tax 570.57 460.37 570.39 455.65
Tax expense 144.13 74.76 144.13 74.76
Net Profit for the year 426.44 385.61 426.26 380.89
Net profit attributable to -
Owners of the Holding Company 426.44 385.61 426.26 380.89

The standalone revenue from operations increased from 4659.30 million to 5130.83 million, an increase of 10% over the previous financial year notwithstanding challenging business environment. The standalone Profit After Tax increased from

385.61 million to 426.44 million, an increase of 11% over the previous financial year. The standalone EPS of your company increased from 18.81 to

19.71 in the current year.

The consolidated EBITDA of your company grew at a faster pace in the current year registering a growth of 15% over the previous year.

TRANSFER TO RESERVES

The Company has not transferred any amount to any reserve for the financial year ended March 31, 2023.

DIVIDEND

Based on the Companys performance and keeping in mind the shareholders interest, the Directors recommend a dividend of @ 4 per share (80%) on the fully paid Equity Shares of 5/- each of the Company, for the year 2022-23. The dividend on equity shares is subject to the Shareholders approval at the ensuing Annual General Meeting (‘AGM). The

Register of Members and Share Transfer Books of the Company will remain closed from September 6, 2023 till September 12, 2023 (both days inclusive) for the purpose of payment of the dividend for the year ended March 31, 2023.

DIVIDEND DISTRIBUTION POLICY

The Company had adopted a Dividend Distribution Policy that sets out the parameters and circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders and/ or retaining profits earned by the Company. The policy is available on the website of the Company at the weblink:-https://windlas.com/policies/dividend-distribution-policy/

BUYBACK OF SHARES

The Board of Directors of your company in their meeting held on November 08, 2022, had approved Buyback of Equity shares of Face Value 5 each of the Company for an amount not exceeding

250,000,000/- at a price not exceeding 325/-(Rupees Three Hundred and Twenty Five Only) per equity share ("Maximum Buy-back Price") payable in cash from the equity shareholders/ beneficial owners of the equity shares of the Company other than the Promoters, members of Promoter Group and persons in control of the Company ("Buyback Offer") from Open Market through Stock Exchange Mechanism in terms of the provisions of Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018 ("Buyback Regulations"). The Company has bought back 867,747 number of Equity share having Face Value of 5 each for an amount 217,966,267 from the open market till March 31, 2023.

The Company completed the Buyback on May 03, 2023 by purchase of 995,800 equity shares aggregating to

250,039,654.15/- excluding transaction costs ("Total Buyback Amount") from the equity shareholders of the

Company (other than the promoters, promoter group and persons in control of the Company). The Total Buyback Amount has been ratified by the Buyback Committee and the Board of Directors of the Company. The Total Buyback Amount represents 6.3855% of the Paid up Share Capital and Free Reserves of the Company as on March 31, 2022, which is within the permissible limit of 10% of the total paid-up equity capital and free reserves of the Company.

EMPLOYEES STOCK OPTIONS SCHEME

The Board of Directors of the Company at its meeting held on April 16, 2021, approved introduction of the ‘Windlas Biotech Limited Employees Stock Option Scheme 2021 ("ESOP 2021"/ "Scheme") for the benefit of the present and future employees of the Company. Each Option when exercised would be converted into one equity share of 5/- each fully paid-up.

The options granted shall vest not later than 5 (five) years from the date of grant of such options. Number of Options that may be granted to an employee under the "ESOP 2021" shall not exceed one-fifth of the total number of Options reserved under the "ESOP 2021" in aggregate per employee or any such ceiling number of options as may be determined by the Committee within such limit with respect to an individual employee. The Company has obtained in-principle approval for listing upto a maximum of 331,696 equity shares of

5/- each of Windlas Biotech Limited to be allotted pursuant to options granted prior to listing of the Company under ESOP 2021 during the year from BSE and NSE.

ESOP Expenses for the year ended March 31, 2023 is

10.08 million (Refer Note No. 30 of the Standalone Financial Statement). The options vested under "ESOP 2021" can be exercised within the period of 4 (Four) years from the date of vesting. There are no potential equity shares in FY2022-23 due to grant of stock options under "ESOP 2021". Therefore, there is no effect on Diluted Earnings per share (EPS) (Refer Note No. 36 of the Standalone Financial Statement).

Disclosure under SEBI (Share Based Employees Benefits and Sweat Equity) Regulations, 2021 regarding details of the "ESOP 2021" is given below.

Date of Shareholders Approval of the Scheme

April 17, 2021 (prior to the IPO)

Total number of options approved under the Scheme

546,222

Number of options Granted

419,439 (Options granted on May 3, 2021, prior to the IPO to the Eligible Employees)

Vesting of Options

Options granted under Plan shall vest not earlier than 1 (One) year and not later than maximum Vesting Period of 5 (five) years from the date of Grant.

Exercise Price/ Pricing Formula

275.35 (The fair value of option has been determined using Black-Scholes option pricing model)

Maximum period within which the grant shall be vested 5 (Five) years from the date of Grant
Number of Options lapsed during the Year

59,353

Number of Options outstanding as on March 31, 2023 315,238 Employee-wise detail of options granted to:

i. Key managerial personnel (KMP)

KMP

Options granted

Komal Gupta

41,183

Mohammed Aslam

19,862

Om Prakash Sule

17,602

Pawan Kumar Sharma

17,020

Ananta Narayan Panda

1,365

ii. Any other employee who received a grant any one year of options amounting to 5% more of the options granted during the year

in Nil or

iii. Identified employees who were granted options Nil during any one year equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of our Company at the time of grant

FINANCIAL STATEMENTS

In accordance with the Ministry of Corporate Affairs ("MCA") circular dated January 13, 2021 read with circulars dated April 08, 2020, April 13, 2020, May 5, 2020 and December 28, 2022, the Annual Report 2022-23 containing complete Balance Sheet, Statement of Profit & Loss, other statements and notes thereto, including consolidated financial statements, prepared as per Ind AS, Directors Report (including Management Discussion & Analysis and Corporate Governance Report) is being sent via email to all shareholders who have provided their email address(es).

The Annual Report 2022-23 is also available at the Companyswebsiteat:https://windlas.com/financial- information/financial-results/fy-22-23/.

CONSOLIDATED FINANCIAL STATEMENTS

In compliance with the applicable provisions of Act including the Accounting Standard Ind AS 110 on Consolidated Financial Statements, this Annual Report also includes Consolidated Financial Statements for the financial year 2022-23. Consolidated Turnover was 5,230.48 million as against 4,726.36 million in the previous year. Net Profit after Tax (after minority interest) for the year stood at 426.26 million as against 380.89 million in the previous year.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 33 of the Securities

Exchange Board of India (Listing Obligations and Disclosure Requirements Regulation, 2015 ("Listing Regulations") and applicable Accounting Standards, the Audited Consolidated Financial Statements of the Company for the 2022-23, together with the Auditors Report, form part of this Annual Report.

OPERATIONS AND BUSINESS PERFORMANCE

Kindly refer to Management Discussion & Analysis and Corporate Governance Report which forms part of this report.

CHANGE IN NATURE OF BUSINESS

During the year under review there is no change in nature of business of the Company.

CREDIT RATING

ICRA Limited, i.e. the Credit Rating Agency has upgraded the long-term rating of the Company to [ICRA] A+ (pronounced ICRA A plus) ("Rating") from [ICRA] A (pronounced ICRA A) ("Rating") and reaffirmed the short-term rating at [ICRA] A1 for facilities of the Company as per their letter dated November 28, 2022.

DIRECTORS

Pursuant to Section 149, 152 and other applicable provisions of the Companies Act,2013, one third of such of the Directors as are liable to retire by rotation, shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Accordingly, Mr. Hitesh Windlass (DIN: 02030941) and Mrs. Prachi Jain Windlass (DIN: 06661073), Directors of the company will retire by rotation at the ensuing AGM, and being eligible, offered themselves for re-appointment in accordance with provisions of the Act. The Board of Directors on the recommendation of the Nomination and Remuneration Committee ("NRC") has recommended their re-appointment.

A brief resume of the Directors being appointed/ re-appointed, the nature of expertise in specific functional areas, names of companies in which they hold directorships, committee memberships/ with chairmanships, their shareholding in the Company, etc., have been furnished in the explanatory statement to the notice of the ensuing AGM. The Nomination and Remuneration Committee and the Board of Directors of the Company recommend their appointment/ re-appointment at the ensuing AGM. Your Company has received declarations from all the Independent Directors confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as an Independent Director.

In terms of section 2(77) of the Act including Rules made thereunder, Mr. Ashok Kumar Windlass, Whole Time Director, Mr. Hitesh Windlass, Managing Director, Mr. Manoj Kumar Windlass, Joint Managing Director and Mrs. Prachi Jain Windlass, Non- Executive Non-Independent Director are related to each other.

KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Act are as follows: Mr. Ashok Kumar Windlass, Whole time Director Mr. Hitesh Windlass, Managing Director Mr. Manoj Kumar Windlass, Joint Managing Director Mr. Pawan Kumar Sharma, Executive Director Mr. Ananta Narayan Panda, Company Secretary and Compliance Officer Mrs. Komal Gupta, Chief Financial Officer w.e.f. May 12, 2022 and Chief Executive Officer w.e.f. February 08, 2023

Policy on directors appointment and Policy on remuneration

Pursuant to Section 134(3)(e) and Section 178(3) of the Companies Act. 2013, the policy on appointment of Board members including criteria for determining qualifications, positive attributes, independence of a director and the policy on remuneration of directors, KMP and other employees is disclosed in the Corporate Governance Report which is part of the Annual Report. The same are also available on the website of the Company at:-https://windlas.com/policies/nomination-and- remuneration-policy/

Performance Evaluation of the Board, its Committees and Individual Directors

In accordance with the applicable provisions of the Act and the Listing Regulations, the Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and individual directors, including Independent Directors. The framework is monitored, reviewed and updated by the Board, in consultation with the Nomination and Remuneration Committee, based on need and new compliance requirements.

The annual performance evaluation of the Board, its Committees and each Director has been carried out for the Financial year 2022-23 in accordance with the framework. The details of evaluation process of the Board, its Committees and individual directors, including independent directors have been provided under the Corporate Governance Report which forms part of this Report.

Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

a) in the preparation of the Annual Accounts for the financial year ended March 31, 2023, the applicable accounting standards have been followed. There are no material departures from the applicable accounting standards;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2023 and of the profit 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 the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors had prepared Annual Accounts on a going concern basis;

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

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

HUMAN RESOURCES DEVELOPMENT AND INDUSTRIAL RELATIONS

Your Company lays extreme emphasis on human resources and caring for them at all levels. Your Company enjoyed harmonious relationships with workers and staff during the year under review and consider them their most important assets. Your Company is concerned for its people, customers, suppliers, and community at large which reflects in the Companys policy, programs and development efforts. As on March 31, 2023, your company had 1049 permanent employees. Your Company is committed to build and strengthen the human capital by defining policies that support their growth, goals, and help them achieve excellence. Various trainings, seminars and workshops were conducted during the year to train employees and enhance their overall performance.

PARTICULARSOFEMPLOYEES/MANAGERIAL REMUNERATION

The information required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

a) The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year:

Directors

Ratio to Median
Remuneration
Mr. Vivek Dhariwal* 1.36
Mr. Ashok Kumar Windlass 69.56
Mr. Hitesh Windlass 69.55
Mr. Manoj Kumar Windlass 65.55
Mr. Pawan Kumar Sharma 20.56
Ms. Prachi Jain Windlass Nil
Mr. Srinivasan Venkataraman* IGHT>1.83
Mr. Gaurav Gulati* 2.45

*The Independent Directors have only been paid sitting fee during the year.

b) The percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:

Directors, Chief Executive

% increase in

Officer, Chief Financial

remuneration

Officer and Company

in the financial

Secretary

year
Mr. Vivek Dhariwal* (27.38)
Mr. Ashok Kumar Windlass Nil
Mr. Hitesh Windlass** 69.07
Mr. Manoj Kumar Windlass** 71.16
Mr. Pawan Kumar Sharma 13.39
Ms. Prachi Jain Windlass Nil
Mr. Srinivasan Venkataraman* (21.90)
Mr. Gaurav Gulati* (7.56)
Ms. Komal Gupta (Chief 10.46
Executive Officer & Chief
Financial Officer)
Mr. Ananta Narayan Panda 17.29
(Company Secretary)

* Mr. Vivek Dhariwal, Mr. Srinivasan Venkataraman and Mr. Gaurav Gulati are Independent Directors and they have been paid only sitting fee during the year. **Remuneration includes commission paid/payable to Mr. Hitesh Windlass (Managing Director) and Mr. Manoj Kumar Windlass (Joint Managing Director) during the year. The Managing Director and Joint Managing Director had waived off their entitlement to receive commission during the financial year 2021-22 and no commission was paid to them in the previous year.

c) Percentage increase in the median remuneration of employees in the financial year: 6.04%

d) Number of permanent employees on the rolls of Company: 1049 e) 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 circumstance for increase in managerial remuneration: Average percentile increase in salary of employees other than managerial personnel was 3.52% Average percentile increase in managerial remuneration was 29.30% in 2022-23 over 2021-22.

f) Affirmation that the remuneration is as per the Remuneration policy of the Company: The Company affirms that the remuneration paid is as per the Remuneration policy of the Company.

g) A 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 provided in a separate Annexure forming part of this Report. Further, the Report and the Accounts are being sent to the Members excluding the aforesaid Annexure. In terms of Section 136 of the Act, the said Annexure is open for inspection at the Registered Office of the Company. Any Shareholder interested in obtaining a copy of the same may write to the Company Secretary.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Boards Report.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has maintained a proper and adequate system of internal controls.

The Company has appointed M/s. Grant Thornton, Chartered Accountants, as an Independent Internal Auditors who periodically audits the adequacy and effectiveness of the internal controls laid down by the management and suggests improvements. This ensures that all Assets are safeguarded and protected against loss from unauthorised use or disposition and that the transactions are authorised, recorded and reported diligently. Your Companys internal control systems are commensurate with the nature and size of its business operations. Internal Financial Controls are evaluated, and Internal Auditors Reports are regularly reviewed by the Audit Committee of the Board.

Statutory Auditors Report on Internal Financial Controls as required under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 is annexed with the Independent Auditors Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report with detailed review of operations, performance and future outlook, as stipulated under Regulation 34 read with Schedule V to the Listing Regulations is presented in a separate section forming part of this Annual Report.

RELATED PARTY TRANSACTIONS

The Company has a policy on Materiality of Related Party Transactions and has been uploaded on the website of the company which can be found on https:// windlas.com/policy-on-materiality-of-related-party/ All related party transactions that were entered into during the 2022-23 were on an arms length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large.

All related party transactions are presented to the Audit Committee. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on quarterly basis, mentioning the nature, value and terms and conditions of transactions.

The details of Related party transactions are provided in the accompanying financial statements.

As all related party transactions entered into by the Company were in ordinary course of business and were on an arms lengths basis, Form AOC–2 is not applicable to Company.

CORPORATE GOVERNANCE

The Company is committed to ensuring good governance practices while protecting the interest of the shareholders by using extreme care, skill and diligence in the business.

The report on Corporate Governance as stipulated under the Listing Regulations forms part of the Annual Report. A certificate from M/s Sandeep Joshi & Associates, Company Secretary regarding compliance of the conditions of Corporate Governance, as stipulated under Schedule V of the Listing Regulations is attached as Annexure and forms part of the Annual Report.

ANNUAL RETURN

In accordance with Section 92 (3) read with Section 134 (3)(a) of the Act, the Annual Return of the Company as on March 31, 2023 is available in the prescribed format on the Companys website at the link: https://windlas.com/financial-information/fy-22-23/

DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 and no amount on account of principal or interest on public deposits was outstanding as on March 31, 2023.

The Company does not have any deposits which are not in compliance with the requirements of Chapter V of the Companies Act, 2013.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

In accordance with the provisions of Section 186 of the Act, the details of Loans, Guarantees and Investments made by the Company as at March 31, 2023 are given in the notes to the Financial Statements.

CORPORATE SOCIAL RESPONSIBILITY

Your Company considers the community as its key stakeholder and endeavours to create economically viable and socially inclusive community. The CSR programmes of the Company are aimed at inclusive development and welfare of the community by carrying out activities primarily related to promoting health care including preventive health care, promoting education and skill development, and animal welfare and environmental sustainability. Disclosure as per Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 in prescribed form is enclosed as Annexure I to the Directors Report. During the financial year 2022-23, the Company has spent 8.39 million (2% spend requirement was 8.04 million) towards various CSR activities, in line with the requirements of Section 135 of the Companies Act, 2013 (‘Act). Details of composition of CSR Committee and Meetings held during 2022-23 are disclosed in the Corporate Governance Report.

SUBSIDIARY/ JOINT VENTURE

As on March 31, 2023, the Company has one subsidiary namely Windlas Inc.

The Company has attached along with its financial statements, a separate statement containing the salient features of the financial statements of the said subsidiaries in "Form AOC-1".

During the year, under review, the Board of Directors reviewed the affairs of the subsidiaries. Also in conformity with Section 134 of the Companies Act, 2013 and Rule 8(1) of the Company (Accounts) Rules, 2014, Note 47 of Consolidated Financial Statement cover the highlights of performance of subsidiaries and their contribution to the overall performance of the Company during the year. US Pharma Windlas LLC is one of the joint venture entity in which Windlas Inc. (Wholly Owned Subsidiary company of Windlas Biotech Limited) has 50% ownership. A policy on material subsidiaries has been formulated and is available on the website of the Company at :-https://windlas.com/policy-on-material-subsidiary/

FAMILIARISATION PROGRAMME

The Company has a familiarisation programme for its Independent Directors which is imparted at the time of appointment of an Independent Director on Board as well as on need basis. During the year, the Independent Directors of the Company were familiarised and the details of familiarisation programmes imparted to them are placed on the website of the Company at:-https://windlas.com/policies/familarization-program-for-independent-directors/

SIGNIFICANT AND MATERIAL ORDERS PASSED BY COURTS, REGULATORS OR TRIBUNALS

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

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company persistently promotes ethical behaviour in all its business activities and in line with the best international governance practices. The Company has established a system through which directors, employees and business associates may report unethical behaviour, malpractices, wrongful conduct, fraud, violation of Companys code of conduct without fear of reprisal. Reporting of instances of leak/ suspected leak of any Unpublished Price Sensitive Information is allowed through this vigil mechanism and the Company has made its employees aware of the same.

The policy has also been posted on the Companys website at:-https://windlas.com/vigil-mechanism-policy/ The Audit Committee periodically reviews the existence and functioning of the mechanism. It reviews the status of complaints received under this policy on a quarterly basis.

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

Pursuant to provisions of Section 134 of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are attached as Annexure II to this report.

STATUTORY AUDITORS

In accordance with the provisions of Section 139 of the Companies Act, 2013, the members at the 19th Annual General Meeting held on August 28, 2020 had approved the appointment of M/s. SS Kothari Mehta & Company, Chartered Accountants (Firm Registration No: 000756N) for a term of 5 years, to hold office till the conclusion of 24th Annual General Meeting, As per the provisions of Section 139 of the Act, they have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Auditors of the Company have not reported any instances of fraud committed against the Company by its officers or employees as specified under Section 143(12) of the Companies Act, 2013.

COST AUDITORS

In terms of the Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Rules, 2014 the Company is required to maintain cost accounting records and have them audited every year.

The Board has re-appointed M/s. Saurabh Jain and Associates as Cost Auditor of the Company for 2023-24 under Section 148 and all other applicable provisions of the Act.

Shareholders approval is being sought for ratification of the remuneration proposed to be paid to M/s. Saurabh Jain and Associates, Cost Auditor of the Company in respect of Cost Audit for the financial year ending March 31, 2024 as mentioned in the Notice convening the AGM.

The Company has maintained cost records as specified under section 148(1) of the Act.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company had appointed Mr. Sandeep Joshi, Company Secretary (COP No. 19210), Proprietor of M/s Sandeep Joshi & Associates, Company Secretary in Practice to undertake the Secretarial Audit of the Company.

Pursuant to provisions of Section 204(1) of the Companies Act, 2013 and Regulation 24A of the Listing Regulations, the Secretarial Audit Report for the financial year ended March 31, 2023 issued by CS Mr. Sandeep Joshi (COP No. 19210), Proprietor of M/s. Sandeep Joshi & Associates, Company Secretary in Practice and the Secretarial Auditor of the Company is annexed as Annexure III and forms an integral part of this Report.

During the year under review, the Secretarial Auditor have not reported any fraud under Section 143(12) of the Companies Act, 2013 M/s Sandeep Joshi & Associates have been reappointed as the Secretarial Auditor for the financial year 2023-24.

Explanation or Comments on disqualifications, reservations, adverse remarks or disclaimers in the auditors reports:

There is no qualification, reservation or adverse remark or disclaimer made by the Auditor in their report. As regards the observations of the Statutory Auditors and the Secretarial Auditor in their Report, the same are self- explanatory and need no clarifications.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is fully committed to uphold and maintain the dignity of every woman working with the Company. The Company has zero tolerance towards any action on the part of any one which may fall under the ambit of ‘Sexual Harassment at workplace. The Policy framed by the Company in this regard provides for protection against sexual harassment of women at workplace and for prevention and redressal of such complaints. Internal Complaints Committees (ICC) have been set up to redress complaints received regarding sexual harassment. Details of Internal Complaints Committee Status of the Complaints during the 2022-23 is as follows:

Particulars

No. of
Complaints
Number of Complaints pending as 0
on Beginning of the Financial Year
Number of Complaints filed during 0
the Financial Year
Number of Complaints pending as 0
on the end of the Financial Year

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

The Company has complied with the provisions of Secretarial Standards on Meetings of the Board of Directors (SS-1) and on General Meetings (SS-2) issued by the Institute of Company Secretaries of India.

DISCLOSURE ABOUT UTILISATION OF INITIAL PUBLIC OFFER (IPO) PROCEEDS

Your Company in the previous financial year made an initial public offer of 8,729,023 equity shares of face value of 5 each ("equity shares") for cash at a price of 460 per equity share (including a share premium of 455 per equity share) aggregating to 4,015.35 million (the "offer") comprising of a fresh issue of 3,586,956 equity shares aggregating to 1,650.00 million (the "fresh issue") and an offer for sale of 5,142,067 equity shares, comprising of 1,136,000 equity shares aggregating to 522.56 million by Vimla Windlass (the "Individual Selling Shareholder") and 4,006,067 equity shares aggregating to

1,842.79 million by Tano India Private Equity Fund II (the "Investor Selling Shareholder") aggregating to 2,365.35 million (the "offer for sale).

Your Company discloses to the Audit Committee the uses/application of proceeds/funds raised from the initial public offer (IPO) as part of the quarterly review of financial results. Your Company has appointed HDFC Bank Limited as the Monitoring Agency in terms of Regulation 41 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements), Regulations 2018 ("ICDR Regulations"), as amended from time to time, to monitor the utilization of IPO proceeds. The Company has obtained monitoring reports from the Monitoring Agency on a quarterly basis confirming no deviation or variation in the utilization of IPO proceeds from the objects stated in the Prospectus/ Offer Document. The Company has submitted the statement(s) and Monitoring Agency Report as required under Regulation 32 of the SEBI Listing Regulations to both the exchanges where the equity shares of the Company are listed, namely the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE).

The IPO Proceeds have been fully utilised as on March 31, 2023 as per the Objects stated in the Offer Document. Please refer Note No. 45 of the Standalone Financial Statement for the details of utilisation of IPO Proceeds.

GREEN INITIATIVE

As a part of its "Green Initiative", the Company has been taking all the measures to reduce its impact on the environment. The Company has implemented the "Green Initiative" to enable electronic delivery of notice/ documents/ annual reports to shareholders Electronic copies of the Annual Report 2022- 23 and Notice of the 22nd Annual General Meeting will be sent to all members through email, whose e-mail addresses are registered with the Company/Depository Participant(s).

ACKNOWLEDGEMENT

The Directors acknowledge with gratitude and wishes to place on record its appreciation for the dedication and commitment of the Companys employees at all levels which has continued to be our major strength. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as industry leaders. We place on record our appreciation for the support and co-operation the Company has been receiving from its suppliers, distributors, dealers, business partners, franchisee units and others associated with the Company as its trading partners. The Company looks upon them as partners in its progress and has shared with them the rewards of growth.

For and on behalf of the Board

Hitesh Windlass

Manoj Kumar Windlass
Managing Director Jt. Managing Director
DIN: 02030941 DIN: 00221671

Place: Gurgaon

Place: Dehradun

Date: May 5, 2023

Date: May 5, 2023