Welspun Corp Director Discussions


To,

The Members,

Welspun Corp Limited

Your Directors present their 28th Report together with the audited financial statements of your Company for the financial year ended 31st March, 2023.

1. FINANCIAL RESULTS

For the year ended

For the year ended

31.03.2023 31.03.2022 31.03.2023 31.03.2022
Revenue from operations 6,916.67 5,287.87 9,758.10 6,505.11
Other income 289.73 482.62 319.98 551.22

Total income

7,206.40 5,770.49 10,078.08 7,056.33

Profit before finance cost, depreciation &

965.10 787.02 804.55 1,022.92
Less : Finance costs 149.28 76.88 243.16 101.89

Profit before depreciation & tax

815.82 710.14 561.39 921.03
Less: Depreciation and amortization expense 108.98 115.28 302.97 254.75

Add: Share of profit/(loss) of joint venture and associates (net)

- - 75.21 (5.72)

Profit before tax

706.84

594.86

333.63 660.56
Less : Tax expense
Current Tax 149.00 109.46 170.58 229.71
Deferred Tax 29.20 (0.32) (36.12) (13.32)

Profit for the year

528.64

485.72

199.17 444.17

Net profit/ (loss) attributable to:

Owners - - 206.69 438.81
Non-controlling interest - - (7.52) 5.36

Earnings per share

(a) Basic (in ) 20.23 18.61 7.91 16.82
(b) Diluted (in ) 20.17 18.57 7.89 16.77

Appropriations to Reserves:

Opening balance in Retained Earnings 1,955.99 1,598.81 2,825.53 2,519.69
Profit for the year 528.64 485.72 206.69 438.81

Re-measurements of post-employment benefit obligations, net of tax

0.05 1.93 (0.07) 1.40
Share of OCI of Joint ventures and associates - - (0.44) (0.43)
Dividend on equity shares (130.47) (130.47) (130.47) (130.47)
Share issue expenses during the year - - (0.11) (3.48)

Closing balance in Retained Earnings

2,354.21 1,955.99 2,901.12 2,825.52

2. HIGHLIGHTS FOR THE YEAR & OUTLOOK.

(a) Sales highlights for the year under the Report are as under:

Product

Standalone (in MT)

Consolidated(in MT)

FY 2022-23 FY 2021-22 FY 2022-23 FY 2021-22
Line Pipes 5,72,514 5,06,483 10,01,262 7,95,826
SS Pipes - - 4,059 2,915
DI Pipes - - 34,383 -
SS Bars - - 6,869 1,531
Billet 1,36,222 1,11,738 1,36,222 1,11,738
TMT Bars - - 17,717 -
Sponge Iron 33,157 17,625 33,157 17,625
Pig Iron - - 1,58,052 -
Hot Metal - - 53,899 -

(b) The year under Report was a successful year for your Company as it executed upon its

Business Growth & Diversification Strategy.

Your company completed the acquisition of the Plastic Products business of Sintex BAPL

Limited & Specified Assets of ABG Shipyard

Limited. The traditional business of Line Pipes demonstrated a steady performance while significant strides were made in stabilizing and ramping up the Ductile Iron Pipes, TMT Bars and Stainless Steel businesses.

(c) Pig Iron, Ductile Iron Pipe and TMT Bar facilities in Anjar

As mentioned in the previous report, the Companys wholly owned subsidiaries commissioned state-of-the-art Blast Furnace, Sinter plant, Coke Oven, TMT Bars and DI Pipes facilities during FY 2022-23.

The Blast Furnace can produce approximately 500,000 MT of Hot Metal per annum which will primarily be used for manufacturing Ductile Iron (DI) Pipes and balance for Pig Iron.

The Coke Oven facility has a production capacity of approximately 210,000 MT per annum of Coke which will primarily be used in the Blast Furnace for manufacturing of Hot Metal. This will help with continuous supply of high-quality coke at a competitive cost to run the plant efficiently.

The Ductile Iron Pipe plant can produce 400,000 MT of Ductile Iron Pipes and the integrated complex is equipped with the latest cutting-edge technology. The facility has recently received BIS certification as well.

Production capacity is being ramped up on gradual basis.

The TMT bar manufacturing facility has a capacity of 350,000 MT per annum. The Company has an existing manufacturing setup of BIS Certified Steel Billets and Direct

Reduced Iron which will be used as inputs for the manufacture of TMT bars.

The DI pipes and the TMT bars are a natural fit for the expansion of your Companys product portfolio and have good synergies with the Companys existing business. These plants with best in class equipment and technology, world class processes and quality standards will further strengthen your Companys efforts in providing access to safe, reliable and clean drinking water for all, and in developing nations infrastructure.

During the few months of its commencement, the Pig Iron facility has received multiple export orders of ~43 KMT for Pig Iron across South East Asia and Europe.

(d) Acquisition of the Specified Assets of ABG

Shipyard Limited

During the year under Report, your Company has received the possession of moveable properties (partially built ships, metal and scrap) from the Liquidator of ABG Shipyard Limited (a company under liquidation) at a consideration of 589 crore. Further, the Companys wholly owned subsidiary i.e. Nauyaan Shipyard Private Limited ("Nauyaan") has received the possession of immovable property at Dahej, Gujarat from the Liquidator of ABG Shipyard Limited at a consideration of 70 crore. The partially built ships, equipment and metal scrap acquired under the Company is estimated to be over ~ 150,000 MT. It is estimated that the Metal/ Metal scrap not required for business purposes will be disposed over 12-15 months. During this period, we will evaluate new business areas like ship re-cycling and ship repair which will not require any major capex.

During the next few quarters, your Companys management will evaluate and study potential new business areas like Green Steel, Defense Ship Building, Off-shore wind and O&G structures etc. to ensure optimal utilization of assets.

(e) Acquisitions of Sintex-BAPL Limited and Sintex Prefab Infra Limited by the subsidiaries

As mentioned in the previous report, to implement the strategy of creating a diversified product portfolio, repurposing its business to add new target segments, expanding its offerings to address both the B2B and B2C markets, and making well-considered strategic acquisitions to expand its base, enhance its brand, penetrate new markets, build a distribution network and provide opportunities to develop new products, your Companys Board is pleased to inform that:-

Big Shot Infra Facilities Private Limited ("Big Shot") (a wholly owned subsidiary of the Company has acquired Sintex Prefab Infra Limited ("SPIL") in terms of the resolution plan submitted for SPIL and as approved by the Honble National Company Law Tribunal, Ahmedabad by its order dated December 21, 2022 ("Resolution Plan"). The acquisition consideration was discharged to the creditors of SPIL for an amount aggregating 30 Crore in the form of Upfront Cash. Further, SPIL entered into definitive documents for discharge of deferred consideration with the lenders for 20 Crore in the form of unsecured loan to be discharged at earlier of a) 3 years from the Effective Date (February 24, 2023) or b) upon monetization of identifiedproperties. Pursuant to the said implementation and in accordance with the Scheme of Arrangement provided under the Resolution Plan, Big Shot has been merged with SPIL with effect from February 24, 2023 and consequent to the merger, SPIL has become a wholly owned subsidiary of the Company.

Propel Plastic Products Private Limited ("Propel") (a wholly owned subsidiary of the Company, has acquired Sintex-BAPL Limited in terms of the resolution plan submitted by the Consortium for SBAPL and as approved by the Honble National Company Law Tribunal, Ahmedabad by its order dated March 17, 2023. Propel has discharged the consideration to the creditors of SBAPL for an amount aggregating 1,251 Crore in the form of Upfront Cash in terms of the Approved Resolution Plan. Pursuant to the implementation of the Resolution Plan, Propel has been merged with SBAPL with effect from March 29, 2023 and consequent to the merger, SBAPL has become a wholly owned subsidiary of the Company with effect from the said date. Further, as required under the Resolution Plan, the Auto Components Business of SBAPL is transferred to bidding consortium member effective March 29, 2023.

(f) Sale of Dahej Unit

During the year under Report, your Company sold land and civil structures, situated at Dahej unit of the Company in the state of Gujarat and had received 125.6 crores as the consideration from the Buyer.

The said unit comprises of insignificant portion of the operations of the Company and the management feels that the transaction would not have any material and adverse effect on operations of the Company.

(g) Scheme of Arrangement between Welspun Metallics Limited ("the Transferor Company") and Welspun Corp Limited ("the Tranferee Company") and their respective shareholders ("the Scheme").

Your Board of Directors have, inter alia, considered and decided to propose to National Company Law Tribunal ("NCLT") for its approval a Scheme under Sections 230-232 of the Companies Act, 2013.

The Scheme, inter alia, provides for transfer and vesting of the entire assets and liabilities of the Transferor Company in the Company with effect from the Appointed Date of April 1, 2022. As the entire share capital of the Transferor Company is held by your Company, upon the Scheme becoming effective, no shares of your Company shall be issued and allotted and the investment by the Company in the Transferor Company shall stand cancelled on the Effective Date (as defined in the Scheme) without any further act, instrument or deed.

The Scheme is expected to achieve the following: (i) The Transferor Company and the Transferee Company are engaged in the business of manufacture and sale of steel and steel products and their proposed merger will create synergies between the businesses, including by pooling of their financial, managerial, technical, distribution, marketing and other resources. The proposed merger is expected to, inter-alia, result in reduction of costs, better alignment, coordination and streamlining of day-today operations of the units; (ii) The consolidation will result in earning predictability, stronger revenue and improved competitiveness, with diversification in product portfolio thereby reducing business risks for the benefit of the shareholders. This will result in strong presence across market segments, provide access to new markets and product offerings along-with better bargaining power with customers / suppliers; (iii) Consolidation and optimization of stockyards could significantly reduce logistics and distribution costs for both companies. Clubbing of shipments may help reduce shipping costs, port terminal charges and ocean freight; (iv) Greater economies of scale and operational efficiencies which will provide a larger and stronger base for potential future growth; (v) The Transferor Company is a new company which is yet stabilizing production and scaling up, while the Transferee Company is an existing stable company with a strong balance sheet, and by merging the Transferor Company with the Transferee Company there are many cost reductions and efficiencies that can be created; (vi) Presently the loan borrowed by the Transferor Company are guaranteed by the Transferee Company and has higher cost of debt. The proposed merger will enable raising funds at relatively lower cost by leveraging on the strong fundamentals of the Transferee Company; (vii) Streamlining the structure of the Transferee Company and making it simple and transparent; and

(viii) Reducing the multiplicities of legal and regulatory compliances

(h) Scheme of Arrangement between Mahatva Plastic Products and Building Materials Private Limited ("the Transferor Company") and Sintex-BAPL Limited ("the Transferee Company")andtheirrespectiveshareholders ("the Scheme").

The Board of Mahatva Plastic Products and Building Materials Private Limited and Sintex-BAPL Limited (both wholly-owned subsidiaries of the Company) have, inter alia, considered and approved the Scheme of Amalgamation of Mahatva Plastic Products and Building Materials Private Limited ("the Transferor Company") with Sintex-BAPL Limited ("the Transferee Company") and their respective shareholders (the "Scheme"), by way of merger by absorption pursuant to a scheme of amalgamation under the provisions of Sections 230 - 232 of the Companies Act, 2013 and other applicable regulatory requirements.

The Scheme, inter alia, provides for transfer and vesting of the entire assets and liabilities of the Transferor Company in the Transferee Company with effect from the Appointed Date of opening hours of March 29, 2023.

Upon the coming into effect of the Scheme, the Transferee Company shall without any further application or deed, issue and allot shares as fully paid up to the shareholders of the Transferor Company, whose names appear in the register of members of the Transferor Company as on the Effective Date or to their successors-in-title, as the case may be, in the following manner:

"1 (One) equity share of the Transferee Company of the face value of INR 10 (Rupees Ten Only) each fully paid up, shall be issued and allotted for every 1 equity share of the Transferor Company of the face value of INR 10/- (Rupees Ten Only) each fully paid"

The Scheme is expected to achieve the following: (i) The Transferor Company was incorporated inter alia for the purposes of acquisition of the Transferee Company and / or acquisition of the loans / debentures of the Transferee Company. The Transferor Company has completed the acquisition of the debentures and Corporate Insolvency Resolution Process in respect of the Transferee Company is completed;

(ii) Currently, the Transferor Company and the Transferee Company are held by a common holding company and are part of the same group. The proposed merger will eliminate the inter-company transactions and investments for the group and will help in streamlining the structure (as there is no requirement of the Transferor Company) and making it simple and transparent; and (iii) Reducing the multiplicities of legal and regulatory compliances.

(i) ESG Initiatives

In continuation to the ESG initiatives undertaken by your Company during the year bygone, your Company has published its maiden Sustainability Report for FY 2021-22, comprehensively reporting its sustainability performance across the environment, social, and governance domains, highlighting the progress made by the Company over its sustainability goals and its alignment with global frameworks like the GRI, UN SDGs, and SASB standards.

In addition, your Company published its first-ever Tax Transparency Report, explaining not only your Companys compliance with tax laws and disclosure requirements and guidelines, but also your Companys overall approach that sets the context for our tax liabilities. The voluntary disclosures through this report demonstrate that your Company strives to uphold the highest standards of tax transparency.

Your Company was ranked in the Top 7 Percent in Global Steel Industry in S&P Globals DJSI Corporate Sustainability Assessment.

(j) Outlook

The business outlook for your company remains promising. The Government of India has set a target to raise the share of natural gas in the energy mix from the current 6% to 15% by 2030. Gas demand will be driven by Fertilizers, City Gas Distribution Players,

Petrochemicals and Refineries. This will result in continuously expanding the gas and City Gas Distribution pipeline network on Pan India basis, and will be a key driver for the growth of the line pipe industry.

There is a strong intent to meet the ambitious targets as envisaged in various Government schemes. The focus by both the Central and State Governments on developing water infrastructure is expected to drive the demand for large diameter HSAW pipes and DI Pipes.

In the US after years of under-investment in oil and gas exploration and infrastructure, the focus is on boosting its oil and gas supply to cater to domestic energy needs as well as for exports to cater the energy needs in Europe. Your Companys HSAW plant in the US is fully booked till December 2023. The current business environment is favorable and active discussions are on to book new orders beyond 2023.

The newly commissioned state-of-the-art TMT plant, having a capacity of 350,000 MT, has received the BIS certification and commenced dispatches. The key growth drivers are spend on infrastructure, housing and construction. The key target market is Gujarat which has a consistent annual demand of 3 million MT per annum, of which only ~ 2 million MT is produced in the state. Your Company is confident to establish its product as a leading

B2C brand in its target markets.

The Stainless Steel business has seen a strong turnaround in performance, both operational and financial. The improved performance is expected to sustain, on the back of several new customer approvals, accreditations, development of new products and penetrating new markets.

Sintex is a National brand with a premium positioning. It is the best known brand for water storage tanks in India with the brand connect being synonymous with Water tanks. Every effort is being made to increase the market share in FY24 by re-energizing the distribution network, product & brand positioning and combining this with Supply

Chain efficiencies.

. RESERVES, DIVIDEND & DIVIDEND POLICY.

The Board is pleased to recommend a dividend

@ 100% for the year ended March 31, 2023 i.e.

5.00 per equity share of 5/- each fully paid-up out of the net profits for the year. In respect of the dividend declared for the previous financial years,

73,68,780 remained unclaimed as on March 31, 2023.

The equity dividend outgo for the Financial Year 2022-23 would absorb a sum of 130.76 crores as against 130.47 crores comprising the dividend of 5.00 per Ordinary (Equity) Share of the face value of 5/- for the previous year. Dividend will be payable subject to approval of members at the ensuing Annual General Meeting and deduction of tax at source to those Shareholders whose names appear in the Register of Members as on the Record Date.

During the year under Report, the Company has transferred dividend of 4,36,335 remaining unclaimed for the financial year 2014-15 to the

Investor Education and Protection Fund. Detail of unclaimed dividend is available on the website of the Company at the web-link: "http://www. welspuncorp.com" under the tab "Investors -> Unclaimed Dividend"

https://www.welspuncorp.com/unclaimed-dividend.php

The Board does not propose to transfer any amount to General Reserves.

In terms of the Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, 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 isthe profits annexed to this Report as Annexure – 1 and is also available on the website of the Company at the web-link: "http://www.welspuncorp.com" under the tab "Investors -> Company Policies"

https://www.welspuncorp.com/uploads/investor_ data/investorreport__116.pdf

4. INTERNAL CONTROLS & INTERNAL AUDIT

Your Company has adequate internal control system, which is commensurate with the size, scale and complexity of its operations. Your Company has a process in place to continuously monitor existing controls and identify gaps and implement new and / or improved controls wherever the effect of such gaps would have a material impact on your Companys operation. The controls were tested during the year under Report and no reportable material weaknesses either in their design or operations were observed. In other observations, appropriate corrective actions were taken as advised by the Audit Committee.

At the beginning of each financial year, a risk-based annual audit plan is rolled out after it is approved by the Audit Committee and the Board. The audit plan aims to evaluate the efficacy and adequacy of the internal control system(s) and compliance(s) thereof, robustness of internal processes, policies and accounting procedures, compliance with laws and regulations.

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

Based on the reports of internal auditor, corrective actions are taken, wherever required. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

5. SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES AND THEIR PERFORMANCE

Welspun Tradings Limited, a wholly owned subsidiary and a trading arm of the Company, has reported a Revenue of 369.81 crores in the current year as compared to 162.35 crores in the previous year, registering an increase of 127.79%. Its profit after tax is

14.05 crores as compared to 3.89 crores in the previous year, registering an increase of 261.18%.

Welspun Wasco Coatings Private Limited, a joint-venture and subsidiary (51% holding by the Company), engaged in concrete weight coating, has reported a Revenue of 12.85 crore in the current year as compared to

27.17 crore in the previous year, registering a decrease of 52.71%. Its loss after tax is

2.32 crore as compared to 32.22 crore in the previous year.

Welspun Pipes Inc., Welspun Tubular LLC and Welspun Global Trade LLC, are wholly owned subsidiaries in the USA. Welspun Pipes Inc. which is holding investment in Welspun Tubular LLC and Welspun Global Trade LLC has reported a consolidated Revenue of 1,548.72 crores in the current year as compared to 1,163.02 crores in the previous year, registering an increase of 33%. Its consolidated loss after tax is 52.53 crores as compared to Profit after tax of 84.21 crores in the previous year.

Welspun Mauritius Holdings Limited, a subsidiary in Mauritius holding investment in pipes & coating business in the Kingdom of Saudi Arabia has reported a Revenue of Nil in the current year as well as previous year. Its loss after tax is after

17.15 crores as compared to profit of 249.52 crores in the previous year mainly due to sale of equity share of East Pipes Integrated Company for Industry in FY 2021-22.

Welspun Metallics Limited, a wholly owned subsidiary engaged in productionAfterTaxin theof hot metal has reported a Revenue of 968.72 crores in the current year as compared to

62.88 crores in the previous year, an increase of 1441%. Its loss after tax is 271.15 crores as compared to 10.67 crores in the previous year, registering an increase of 2441%.

Welspun DI Pipes Limited, a wholly owned subsidiary engaged in production of DI Pipes has reported a Revenue of 265.72 crores in the current year as compared to 0.27 crores in the previous year, an increase of 98315%. Its loss after tax is 22.68 crores as compared to

4.30 crores in the previous year, registering an increase of 427%.

Anjar TMT Steel Private Limited, a wholly owned subsidiary engaged in production of Billets and TMT Bars has reported a Revenue of 138.88 crores in the current year as compared to Nil in the previous year. Its loss after tax is 13.21 crores as compared to

0.67 crores in the previous year, registering an increase of 1872%.

Welspun Specialty Solutions Limited a subsidiary engaged in business of specialty steel & tubes has reported a Revenue of 417.83croresinthecurrentyearascomparedto

163.29 crores in the previous year, an increase of 156%. Its profit/(loss) after tax is (13.74) crores as compared to loss of (32.44) crores in the previous year, registering a decrease in loss of 57.66%.

Sintex Prefab and Infra Limited, a wholly owned subsidiary with the objective of engaging in business of pre-fabricated Structures, Infra Project Services and turnkey projects in India has reported Nil Revenue in the current year and the previous year. Its loss after tax is (0.38) crores as compared to 0.00* crores in the previous year.. Sintex Prefab and Infra Limited become a wholly owned subsidiary of the Company w.e.f. February 24, 2023.

* amount is below rounding off norms.

Sintex-BAPLLimited,awhollyownedsubsidiary engaged in business of manufacturing of polymer and polymer products has reported a Revenue of 9 crores in the current year. Its profit 1.16 crores. Sintex-BAPL Limited become a wholly owned subsidiary of the Company w.e.f. March 29, 2023.

Sintex Holdings BV, a step down wholly owned subsidiary in Netherlands acts as a finance company, has reported Nil Revenue and Profit previous year. Sintex Holdings BV become a wholly owned subsidiary of the Company w.e.f. March 29, 2023.

Sintex Logistics LLC, a step down wholly owned subsidiary in the USA is marketing and business development outfit which is sourcing solutions from the Indian operations for its US clients has reported a Revenue of 1.16 crores in the current year. Its profit after tax is

0.18 crores. Sintex Logistics LLC become a wholly owned subsidiary of the Company w.e.f. March 29, 2023.

Nauyaan Shipyard Private Limited, a wholly owned subsidiary and SPV with the object of acquiring immovable assets from liquidator of ABG Shipyard Limited has reported Nil Revenue in the current year. Its loss after tax is 5.08 crores. Nauyaan Shipyard Private Limited become a wholly owned subsidiary of the Company w.e.f. September 19, 2022.

Mahatva Plastic Products and Building Materials Private Limited, a wholly owned subsidiary and SPV with the object of purchasing NCDs of Sintex-BAPL Limited for the purpose of acquisition of Sintex-BAPL Limited has reported Nil Revenue in the current year and the previous year. Its profit after tax is 15.44 crores as compared to loss after tax 0.03 crores in the previous year. Mahatva Plastic Products and Building Materials Private Limited become a wholly owned subsidiary of the Company w.e.f. November 26, 2021.

Welspun Captive Power Generation Limited, an associate (21% shareholding) of the Company engaged in business of generation of power for captive consumption of its shareholders has reported a Revenue of

290.51 crores in the current year as compared to 437.21 crores in the previous year, a decrease of 33.55%. Its profit after tax is 11.86 crores as compared to 17.63 crores in the previous year, registering a decrease of 32.73%.

Clean Max Dhyuthi Private Limited, an associate (26% shareholding) of Welspun Metallics Limited, a wholly owned subsidiary of the Company engaged in business of generation of power for captive consumption of its shareholders has reported a Nil Revenue and loss after tax of 0.02 crores in the current year. Its a newly incorporated Company and become associate of the Company w.e.f. July 28, 2022.

East Pipes Integrated Company for Industry, an associate (35.01% shareholding) of the Company engaged in business of manufacturing and coating of pipes has reported a Revenue of 3,088.72 crores in the current year as compared to 1,187.32 crores in the previous year, an increase of 160%. Its profit after tax is 214.18 crores as compared to loss of 6.45 crores in the previous year.

During the year under report, pursuant to the resolution plan submitted by True Guard Realcon Private Limited for Sintex Prefab and Infra Limited as approved by Honble National Company Law Tribunal ("NCLT") Ahmedabad Bench vide its order dated December 21, 2022 passed in I.A./ 404 (AHM)/ 2022 in C.P. (IB) No. 321 of 2020 ("Resolution Plan"), Big Shot Infra Facilities Private Limited, a wholly owned subsidiary of the Company got merged in to Sintex Prefab and Infra Limited and ceased to exist w.e.f. February 24, 2023.

During the year under report, pursuant to the approval of the resolution plan dated January 25, 2023 (as amended by the addendum dated January 28, 2023) ("Resolution Plan") submitted by the consortium of Propel Plastic Products Private Limited (The Implementing Entity) and Plastauto Private Limited (earlier known as Tubular Pipes Private Limited) (together, "Consortium" or "Resolution Applicants") duly approved by the Committee of Creditors (CoC) of Sintex-BAPL Limited on February 6, 2023 and the Honble National Company Law Tribunal, Ahmedabad Bench ("NCLT") vide its order dated March 17, 2023 ("PlanApprovalOrder")inaccordancewiththe provisions of the Insolvency and Bankruptcy Code 2016 ("Code"), Propel Plastic Products Private Limited , a wholly owned subsidiary of the Company got merged in to Sintex-BAPL Limited and ceased to exist w.e.f. March 29, 2023.

A report on the performance and financial position of each of the subsidiaries, joint venture and associate companies included in the consolidated financial statement is presented in Form AOC-1 annexed to this Report as Annexure - 2.

Financial statements of the subsidiaries and joint venture are hosted on the website at the web-link: "http://www.welspuncorp. com" under the tab "Investors -> Subsidiary Accounts". https://www.welspuncorp.com/subsidiary-accounts.php

6. DEPOSITS

The Company has not accepted any deposit within the meaning of the Chapter V to the Companies Act, 2013. Further, no amount on account of principal or interest on deposit was outstanding as at the end of the year under report.

7. DETAILS OF UTILIZATION OF FUNDS RAISED THROUGH PREFERENTIAL ALLOTMENT OR QUALIFIED INSTITUTIONS PLACEMENT AS SPECIFIED UNDER REGULATION 32 (7A)

During the financial year under review, no funds have been raised by the Company through preferential allotment or qualified institutions placement, and no such funds raised during the preceding years were lying unutilized as at the beginning of the financial year under review.

8. AUDITORS i) Statutory Auditors:

Your Companys Auditors M/s. Price Waterhouse Chartered Accountants LLP, who have given their consent and confirmation of qualification for re-appointment as the

Statutory Auditors have been re-appointed for second term ending on the conclusion of the 29th Annual General Meeting. The remuneration approved by the Board for the Financial Year 2023-24 is 1.785 crores p.a. plus applicable taxes (subject to deduction of tax as may be applicable) and travelling and out-of-pocket expenses. However, in view of increase in the activities due to various acquisitions, the remuneration for the Financial Year 2022-23 is proposed to be

1.985 crores.

Total fees for all services paid by the Company and its subsidiaries, on a consolidated basis, to the statutory auditor and all entities in the network firm/network entity of which the statutory auditor is a part during the financial year under Report is 3.55 crores.

ii) Cost Auditors:

The Board had appointed M/s. Kiran J. Mehta

& Co, Cost Accountants (Firm Registration No. 000025), as Cost Auditor for conducting the audit of cost records of the Company for the Financial Year 2022-23.

The Board of Directors on the recommendation of the Audit Committee, appointed M/s. Kiran J. Mehta & Co, Cost Accountants (Firm Registration No. 000025), as the Cost Auditors of the Company for the Financial Year 2023-24 under section 148 of the Companies Act, 2013. M/s. Kiran J. Mehta

& Co, Cost Accountants have confirmed that their appointment is within the limits of section 141(3)(g) of the Companies Act, 2013 and have also certified that they are free from any disqualifications specified under section

141(3) and proviso to section 148(3) read with section 141(4) of the Companies Act, 2013.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in a General Meeting for their ratification. Accordingly the members are requested to approve their remuneration by passing an ordinary resolution pursuant to Rule 14 of the Companies (Audit and Auditors) Rules, 2015 as included in the Notice convening the Annual General Meeting.

iii) Secretarial Auditors:

Pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. Mihen Halani & Associates, Practicing Company Secretary

(Certificate of Practice Number: 12015) to undertake the Secretarial Audit of the Company, for the Financial Year 2022-23.

As per the rotation policy of the Company, the Board of Directors have appointed M/s. M. Siroya and Company, Practicing Company Secretary, as the Secretarial Auditor of your Company for the Financial Year 2023-24.

9. AUDITORS REPORT

(a) Statutory Auditors Report:

The Auditors observations read with Notes to Accounts are self-explanatory and therefore do not call for any comment.

(b) Cost Audit Report :

As required under the Companies (Accounts) Rules, 2014, the cost accounting records, as specified by the Central Government under

Section 148(1) of the Companies Act, 2013, were made and maintained by the Company.

The Company had appointed M/s. Kiran J. Mehta & Co., Cost Accountants as the Cost Auditors of the Company for auditing cost accounting records for the financial year

2022-23. The Cost Audit Report for the year

2021-22 was e-filed on August 24, 2022. The Cost Audit for the financial year 2022-23 is in progress and the report will be e-filed

Ministry of Corporate Affairs, Government of India, in due course.

(c) Secretarial Audit Report :

Secretarial Audit Report given by M/s. Mihen Halani & Associates, Company Secretaries is annexed with the Report as Annexure 3. The Report, read with the annexure thereto, contain following statement of facts, which are explained / commented by the Board as under:-

Due to resignation of Mr. Dogra from independent directorship of the Company w.e.f. 14.03.2023, composition of the Audit Committee was not in compliance with the regulation 18(1)(a) of the SEBI (LODR), Regulations, 2015 from 14.03.2023 till 31.03.2023. However, the Company has re-constituted the Audit Committee by inducting Mr. Anjani Agrawal as a member of Audit Committee w.e.f. 01.04.2023, who has been appointed as an independent director of the Company w.e.f. April 1, 2023.

The Board noted that the vacancy in the Audit Committee was caused due to the resignation tendered by an independent director and a member of the Committee, which was then filled within the time prescribed under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and therefore, as such, there was no non-compliance.

The Company has paid fine of 2,360 levied by BSE Limited for delay in furnishing prior intimation with respect to date of payment of interest to Non-Convertible Debenture holders (paid in the month of February 2021 and May 2021) under regulation 50(1) of the SEBI LODR Regulations, 2015.

The Board noted the inadvertent delay and recommended furnishing the intimation with respect to date of payment of interest to Non-Convertible Debenture holders of all series of

NCDs at the beginning of the financial year.

The Company has undertaken an audit for the Financial Year 2022-23 for all applicable compliances as per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Circulars/Guidelines issued thereunder. The Annual Secretarial

Compliance Certificate duly signed by

M/s. Mihen Halani & Associates, Company Secretaries has been submitted to the Stock Exchanges and is annexed at Annexure 4 to this Boards Report. For explanation and comments of the Board on the statement of facts with respect to imposition of penalty of 2,360 by BSE Limited as reported in the

Annual Secretarial Compliance Certificate, please refer to the para above.

There is no Material Unlisted Indian Subsidiary of the Company as on March 31, 2023 and as such the requirement under Regulation 24A of the Listing Regulations regarding the Secretarial Audit of Material Unlisted Indian Subsidiary is not applicable to the Company for the Financial Year 2022-23.

(d) Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, the Cost Auditors and the Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the

Audit Committee under section 143(12) of the Companies Act, 2013.

10. SHARE CAPITAL & LISTING

A) The Company does not have any equity shares with differential rights and hence disclosures as per Rule 4(4) of the Companies (Share Capital and Debentures) Rules, 2014 are not required. Further, the Company has not issued any sweat equity shares and hence no disclosure is required under Rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014.

B) The Company had granted stock options during the financial year 2018-19 and the financial year 2022-23. Disclosure as required under Regulation 14 of the SEBI (Share Based Employee Benefits & Sweat Equity)

Regulations, 2021, Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 and Part-F of

Schedule I to the SEBI (Share Based Employee Benefits & Sweat Equity) Regulations, 2021 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

Welspun Employee Stock Option Plan

Welspun Employee Stock Option Plan Welspun Corp Employee Benefit Scheme 2022

(b) Date of shareholders approval

September 30, 2005

July 29, 2022

(c) Total number of options approved under ESOS

5,614,752

1,30,00,000

(d) Vesting requirements

30% on end of one year from the date of grant; 35% on end of second year from the date of grant and 35% on end of third year from the date of grant.

25% each year on and from the end of one year from the date of grant.
(e) Exercise price or pricing

100/- The exercise price shall be
formula decided by the Nomination
& Remuneration Committee)
subject to minimum of face
value i.e. 5 per Share
(f) Maximum term of options

3 years from vesting date

3 years from vesting date
granted
(g) Method of Settlement

Equity

Equity

(h) Source of shares (primary, secondary or combination)

Primary

Either by way of Secondary acquisition from the market and/or direct allotment from the Company

(i) Variation in terms of options

No modifications were made to the schemes duringNo modifications were made the year except change in the Exercise Price to the schemes during the from market linked exercise price to fixed exercise year.

price of " 100/- per ESOP" was approved by the Shareholders at the Annual General Meeting held

The scheme is in compliance with the regulations.

on July 29, 2022. The scheme is in compliance with the regulations.

(II) Method used to account for ESOS - Intrinsic or fair value.

Welspun Employee

Welspun Employee Welspun Corp Employee

Stock Option Plan

Stock Option Plan Benefit Scheme 2022

T h e C o m p a n y h a s re c o g n i z e d compensation cost using fair value

The Company has The Company has recognized compensation recognized compensation cost using fair value cost using fair value method method of accounting. of accounting. The Company

method of accounting. The Company has recognized stock option compensation cost of NIL in the statement of profit and loss for theloss for the financial year financial year 2022-23.

The Company has has recognized stock option recognized stock option compensation cost of NIL compensation cost in the statement of profit of 5.58 crores in the and loss for the financial year statement of profit and2022-23. 2022-23.

(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.

The Company accounted for employee compensation cost on the basis of fair value of the options.

The Company accounted for employee compensation cost on the basis of fair value of the options.

(IV) Option movement during the year

Number of options outstanding at the beginning of the period

1,935,000

Nil

1,30,00,000

Options granted Nil 11,00,000 Nil
Options forfeited / lapsed 10,000 Nil Not applicable
Options vested Nil Nil Not applicable
Options exercised 5,80,000 Nil Not applicable
The total number of shares 5,80,000 Equity shares Not Applicable Not applicable
arising as a result of exercise were allotted during FY
of option 2022-23 for 5,80,000

FY 2022-23.

ESOPs exercised during

The exercise price 100/- 100/- Not applicable

Money realized by exercise of options

5,80,00,000

Not Applicable

Not applicable

Loan repaid by the Trust during the year from exercise price received

Not applicable

Not applicable

Not applicable

Number of options outstanding at the end of the year

13,45,000

11,00,000

Not applicable

Number of options exercisable at the end of the year/total number of options in force

13,45,000

Not applicable

Not applicable

Employee wise details of options granted to:-

Key managerial personnel

Granted during the financial year 2018-19:

Granted during the Not applicable financial year 2022-23:

Mr. Vipul Mathur, MD &

Mr. Vipul Mathur, MD &

CEO – 15,00,000

CEO – 11,00,000

Any other employee who receives a grant of options in any one year of option

Granted during the financial year 2018-19:

Not applicable

Not applicable

amounting to five percent or more of options granted

Mr. Godfrey John - CEO (Pipes) :

during that year

150,000

Mr. T. S. Kathayat - President & Global Operation Head

- Pipe Business :150,000

Mr. Chintan Thaker- Head - Corporate Affairs and Strategic Planning Cell: 150,000

Identified employees who were granted option, during any one year, equal to or exceeding one percent of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant.

Nil

Nil

Nil

Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of option calculated in accordance with Accounting Standard (AS) 20 "Earnings Per Share".

20.17

20.17

20.17

Where the company has calculated the employee compensation cost using the intrinsic value of the stock 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 Company accounted for employee compensation cost on the basis of fair value of the options.

The Company The Company accounted accounted for employee for employee compensation compensation cost on cost on the basis of fair the basis of fair value of value of the options. the options.

The impact of this difference on profits and on EPS of the company shall also be disclosed.

 

Weighted-average exercise prices and weighted-average fair values of options shall

Weighted-average exercise prices – 100 Weighted-average exercise prices – 100

Weighted-average exercise prices – Not Applicable

be disclosed separately for options whose exercise price either equals or exceeds or is less than the market price of the stock

Weighted-average fair value – 52.01 Weighted-average fair value – 132.31

Weighted-average fair value – Not Applicable

The number and weighted average exercise prices of stock options

Opening balance 100 100 Not Applicable
Granted during the year Not Applicable 100 Not Applicable
Exercised during the year 100 Not Applicable Not Applicable
Forfeited during the year Not Applicable Not Applicable Not Applicable
Expired during the year 100 Not Applicable Not Applicable
Closing balance 100 100 Not Applicable

Exercisable at the end of the year

100 100

Not Applicable

A description of the method and significant assumptions used during the year to estimate the fair values of options,

including the following weighted-average information:

i. the weighted average values share price,

of 100

100

Not Applicable

ii. the weighted average values exercise price

of 100

100

Not Applicable

iii. expected volatility 50% 50% Not Applicable

iv. expected Option life

0.89 years

4.4 years

Not Applicable

v. expected dividends

0.55%

2.16%

Not Applicable

vi. risk-free interest rate

7.49 % to 7.85 %

6.34 % to 6.90 %

Not Applicable

 

vii. Method used and the assumptions Black Scholes method is made to incorporate the effects used for fair valuation of of expected early exercise; ESOP.

Black Scholes method is used for fair valuation of ESOP.

Black Scholes method is used for fair valuation of ESOP.

viii. how expected volatility was The measure of volatility determined, including an used in ESOP pricing explanation of the extent to model is the annualized which expected volatility was standard deviation based on historical volatility; of the continuously compounded rates of return. Expected volatility for fair valuation is considered based on average of previous 6 years annualized volatility.

The measure of volatility used in ESOP pricing model is the annualized standard deviation of the continuously compounded rates of return. Expected volatility for fair valuation is considered based on average of previous 6 years annualized volatility.

The measure of volatility used in ESOP pricing model is the annualized standard deviation of the continuously compounded rates of return. Expected volatility for fair valuation is considered based on average of previous 6 years annualized volatility.

ix. whether and how any other The following factors features of the options granted have been considered

The following factors have been considered

The following factors have been considered

were incorporated into (a) Share Price (a) Share Price (a) Share Price
measurement of fair value, such (b) Exercise price (b) Exercise price (b) Exercise price
as a market condition. (c) Historical volatility (c) Historical volatility (c) Historical volatility
(d) Excepted option life (d) Excepted option life (d) Excepted option life
(e) Dividend Yield (e) Dividend Yield (e) Dividend Yield

x. the price of the underlying share 126.10 in market at the time of option grant.

224.05

Not Applicable

 

Details related to Trust

(i) Name of the Trust

Not Applicable

Not Applicable Welspun Corp Employees Welfare Trust

(ii) Details of the Trustee(s)

Not Applicable

Not Applicable Mr. Parasmal Jain; Mr. Yogesh Mehta

(iii) Amount of loan disbursed by company / any company in the group, during the year

Not Applicable

Not Applicable Nil

(iv) Amount of loan outstanding (repayable to company / any company in the group) as at the end of the year

Not Applicable

Not Applicable Nil

(v) Amount of loan, if any, taken from any other source for which company / any company in the group has provided any security or guarantee

Not Applicable

Not Applicable Nil

(vi) Any other contribution made to the Trust during the year

Not Applicable

Not Applicable Nil

Brief details of transactions in shares by the Trust

(i) Number of shares held at the beginning of the year

Not Applicable

Not Applicable Nil

(ii) Number of shares acquired during the year through (i)

Not Applicable

Not Applicable Nil

primary issuance (ii) secondary acquisition, also as a percentage of paid up equity capital as at the end of the previous financial year, along with information on weighted average cost of acquisition per share

(iii) Number of shares transferred to the employees / sold along with the purpose thereof

Not Applicable

Not Applicable Nil

(iv) Number of shares held at the end of the year

Not Applicable

Not Applicable Nil

Secondary acquisition by the Trust

Not Applicable

Not Applicable Nil

A Certificate obtained from M/s. Mihen Halani & Associates, the Company with respect to the implementation of Welspun Employee Stock Option Plan 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.

Information as required under Regulation 14 read with Part F of Schedule I of the SBEB Regulations 2021 has been uploaded on the Companys website and can be accessed at the Web-link: http://www.welspuncorp.com" under the tab "Investors -> Company Disclosures https://www.welspuncorp.com/uploads/investor_data/investorreport__998.pdf

C) Disclosure of Shares

held in suspense account in terms of Regulation 39 read with Clause F of

Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

 

No of shareholders

No of Shares

Outstanding Balance beginning of the year

in the suspense account lying at the 20 5,530

Number of shareholders who approached issuer for transfer of shares from suspense account during the year

11 4,060
Transferred/Credited during the year 11 4,060
Balance outstanding 9 1,470

The voting rights on these shares shall remain frozen till the rightful owner of such shares claims the shares.

D) Listing with the stock exchanges

The Companys equity shares are listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Secured/ Unsecured, Redeemable, Non-Convertible Debentures are listed on the BSE.

Applicable annual listing fees for the year 2022-23 and 2023-24 have been paid to both the BSE and the NSE as per the invoices received by the Company.

11. Annual Return of the Company.

Pursuant to section 134(3)(a) and section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, a copy of the Annual Return in Form MGT-7 of the Companies (Management and Administration) Rules, 2014 is placed on the website of the Company and can be accessed at the web-link: "http://www.welspuncorp.com" under the tab "Investors -> Annual Return"

https://www.welspuncorp.com/annual-return.php

12. Proceedings Under The Insolvency And Bankruptcy Code, 2016 (31 Of 2016)

There were no proceeding initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016.

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

A) Conservation of energy:

a) Initiatives taken for conservation of energy, its impact are as under:

Description of Energy Efficiency

Energy Savings Savings

Improvement Measure

[kWh/Annum] [ In Crores Annum]

Anjar Pipe & Coating Plants

1 Replacement of conventional lights with LED lights - High way, Inspections, High Mast , and admin area

3,23,441 0.323

Auditors of 2 Compressed air for pipe operations from a centralized air network directly from power plant

13,35,207 1.335

3 Replacement of L-Saw Canteen Ceiling fans (17 nos) from 75W to 26W energy efficient fans.

1,202 0.001
4 Conventional AC convert in Energy Efficient AC 23,512 0.024

5 15 kW VFD installation in ECP-3 Blasting blowout blower motor

4,167 0.004

6 45 kW VFD installation for ECP-1 Blasting blowout blower motor

18,431 0.018
7 Installation of a 45 kW VFD for ICP-1, ISB-1 & ISB- 1,682 0.002
2 dust collector blower motors

8 Installation of a 15 kW VFD for ECP-3 final ID cleaning blower motor

841 0.001

9 Coating 2 Plant External ABO Drive installed (ABO Star-Delta starter converted to 45 kW VFD Drive)

20,454 0.021

 

Description of Energy Efficiency

Energy Savings Savings

Improvement Measure

[kWh/Annum] [ In Crores Annum]

Anjar Pipe & Coating Plants

10 Power saving in DM transfer pump at Coating 2 for LSAW plant (5.5 kW pump near RO plant).

9,258 0.009

11 Power saving in DM water transfer pump (2.2 kW Pump near RO plant)

2,631 0.003

12 HFW 1- Installation of VFD in conveyor motors (15 kW x 4 No. VFD, 2.2 kW x 4 no. motor per group, four group conveyor)

2,553 0.003

13 HFW 1- Provision of 450 KVAR APFC panel for Power Factor improvement of HF welder 600 KW.

42,786 0.043

14 HFW2: Provision of 225 x 2 KVAR APFC panel for Power Factor improvement of Seam Annealer 2 x 400 KW.

51,022 0.051

Sub-Total

18,37,187 1.837

Bhopal Pipes & Coating Plants

1 Pressure setting of main compressor ZH-450 from 7.0 to 6.5 bar

75,000 0.053

2 Stoppage of process cooling tower fan at night time during winters

14,789 0.011

3 Installed Air Regulators in Mill Plasma Cutting machine

22,680 0.016

4 Power saving from Rain Water Harvesting 5000 KL during monsoon season

2,700 0.002

Sub-Total

115,169 0.082

Mandya Pipe Plant

1. Replaced conventional starter with VFD 39,675 0.030

2. Replacement of conventional lights with LED lights

54,094 0.036

Sub-Total

93,769 0.066

b) The steps taken by the company for utilizing alternate sources of energy - Alternate Power - 1 MW solar power is considered in FY 23-24 for Mandya plant.

c) The capital investment on energy conservation equipment-

I) Anjar: With a total capital investment of

4.56 Crores in FY 22-23, we are having energy savings of 1.83 Crores per year at 10/kWh.

II) Bhopal: With a total capital investment of

0.954 crore in FY 22-23, we are having energy savings of roughly 0.081 crore per year at 7/kWh.

III) Mandya: With a total capital investment of 0.023 crore in FY 22-23, we are having energy savings of roughly 0.066 crore per year at 7.6/kWh.

B) Technology absorption and Research & Development (a) Innovation.

Details of plant-wise innovations are as under:

Anjar Pipe & Coating Plants:

Automatic Inquiry Management System is live and is in use for LSAW, HSAW, HFW, and Coating.

Development of an automated documentation management system for compiling manufacturing record.

Development of Material Test

Certificate (MTC) with QR code.

Bhopal Pipe & Coating Plant:

DFBE commissioned for the first time in Bhopal.

In-house erection and commissioning of a Flux Recovery system.

Rain water harvesting has been established thereby saving more than 16000 KL of water.

Plant modification execution of 143" diameter pipes.

Plant modification and successful execution of 98" diameter pipes with wall thickness of 25 mm (Pipe weight - 18.5 MT).

Air Drier provided offline to improve weld quality of pipes.

PU coating booth made from scrap material saving 9 Lakhs.

(b) Research & Development carried out by the Company.

Anjar Pipe & Coating Plants:

A total expenditure of 4.08 crore was made during FY 22-23 for the following R&D projects:

Development of Pipelines for transportation of Pure Hydrogen/ blended with Natural Gas. Carrying out tests required for qualification of pipelines as per ASME B31.12 standard.

Successfully demonstrated readiness of SAWL product after completing extensive testing as per ASME B31.12 duly certified by RINA.

Participation in JIP program on revising the guidelines for Design and Operation of Hydrogen Pipelines.

Participated in the subcommittee for development of Line Pipe

Specification by Bureau of Indian

Standards.

Actively involved in the ASME subcommittee for development of pipelines for Hydrogen transportation.

Development of Sour Grade Steel for ERW application is being carried out with M/s TATA Steel, one of the leading Indian steel makers.

Developing various coating material suppliers after successful trials:-A) Food Grade Liquid Epoxy from Berger, Shalimar, JSW, Grant Polycot Paints

B) HDPE Material from KLJ, BLS polymers & Hyundai C) High-Temperature FBE powder from Jotun & 3M India.

and Developmentsuccessfulof pipelines for deep offshore application with Alfa-fab 1.0 requirements in coating simulated condition.

Development of extra thick pipelines for deep offshore & sour service application.

Bhopal Pipe & Coating Plants:

Reusing of Discarded Oil through filtration thereby saving 1 Lakh approx.

Through-Beam Sensors have been replaced by DISC sensors at Internal Blaster 1 & 2, improving the life of the sensors.

Development of a substitute hydraulic pump causing inventory control, cost reduction and standardisation of spares.

(c) Technology Up gradation Anjar Pipe & Coating Plants:

HFW Plant:

Existing Coil UT system "UNIVIS" Electronics is obsolete and no spares are available. System requires up gradation as per compliances, PO placed to OEM and will complete by end of 2023.

Coil UT automatic paint marking system developed for IOCL, APA and Shell who have mandated that the defect be located and automatically measured.

Centralized operation of slitting line from one integrated workstation.

Automatic data transfer from Spectrometer to SAP to avoid manual feeding and eliminate human intervention in the process.

LSAW Plant:

Successful installation and execution of an indigenous laser based robotic pipe end measurement system as per SCR pipes specification.

Coating-2 Plant:

Installation of a robotic probe with camera and laser which is used for visual inspection of the inside surface of pipes.

Digitalization:

Automated processing of inquiries through an AI based software.

Quality:

Installation of a Ring Expansion testing facility to comply with KUR.3367-

SP-L-0001 specification to test samples for Australian projects.

Bhopal Pipe & Coating Plant:

Spiral Plant:

New Digital System Installed at Hydro Tester to eliminate Chart Recorder and save paper.

Coating Plant:

Installed sensors in internal painting system to reduce paint wastage, cycle time and human error and has been reduced by 2% in comparison to existing norms.

Changed Plant PLC and Drive Profi-net

Network from series to star to avoid

Profi-net communication issues.

Weld Seam Applicator installed to reduce the overall PE consumption by 2%.

Mandya Pipe Plant:

Spiral Plant:

Laser Scanner System development and installation for ID & OD welding.

Installation of VFDs for air compressors as an energy saving initiative.

Conventional starters replaced with VFDs at EOT Crane - 40T, a safety and an energy saving initiative.

Installation of RMU for HT-Power Changeover as an safety initiatives using technology in operation

(d) Process & System Improvement Anjar Pipe & Coating Plants:

Spiral 2 Plant:

Stop & Go assembly installation at Hydro tester (IS) entry and re-routing of hydraulic piping accordingly for smooth movement of large diameter pipe (above 80" OD).

LSAW Plant:

Strengthening of JCO press by using Finite Element Analysis on the structure.

Hampleman provision in sample exit bed to eliminate scratches on pipe surface

Coating 2 Plant:

Improved illumination in the plant in day time by providing transparent shed sheets saving energy and enhancing process efficiency.

Skill development:

Established a dedicated Technical Centre of Excellence (TCOE center) for the development of employees skill and provide them with practical training in the field of Welding, NDT, Hydraulics,

Mechanics, Electronics, Workshop and

Quality etc.

ESG:

Installation of a paper shredder for zero land fill,paper waste is now being shredded and sent for recycling.

Implementation of ESG projects (Energy saving by VFD installation, LED lights, power factor improvement)

SAVE WATER project: Process & reject drinking RO water utilization for gardening purposes for WCL Anjar Campus-1 plant.

Bhopal Pipe & Coating Plant:

Spiral Plant:

Installed 2 Nos of AC Drives (Siemens) for Edge Milling-1 Machine.

Coating Plant:

Internal Blaster turbine modified for

18" pipe by performing changes in the Lunnette outer ring and installing new 70 mm OD PU rollers, saving the cost for a new Boom ( 46 Lacs).

Reusing of conveyor rollers from application area to blasting line by following 3R, saving 1.8 Lacs.

PU coating paint booth relocated to reduce change over time during 3LPE to PU.

Conveyor alignments done in coating line to avoid coupling of pipes for sizes 24" to 60".

Emergency lighting provided in Coating Plant considering the frequent power cut.

Air Conditioner installed at External Blaster, Application, Internal Blaster, Extruder Electrical control rooms to avoid overheating of electronic components.

UPS installed at all electrical control rooms for PLC and HMI to protect the system failing due to power fluctuation.

End brush assembly modification to optimize the use of end brush, saving

96,984.

Provided DSL end stopper at every 10-metre distance for EOT crane – 25T to restrict displacement of DSL. Through this modification, DSL breakdown has reduced up to 90%

RYB indication lamp provided at internal 7.5T crane DSL to indicate that DSL is switched on. (Safety requirement)

Mandya Pipe Plant:

Spiral Plant:

Installed 800KL Pond to promote Rainwater Harvesting.

Hydro Tester Water recirculation by passing through a sand filter unit as well as using RO drainage water for the testing process as a water conservation project.

High Mast LED Lights installed at Pipe Yard for better visibility and safe pipe handling.

LED Display Board installed for displaying Environment data as a digitalization initiative.

(e) Key Initiatives for Future Anjar Pipe & Coating Plants: Digitalization:

Development of an HSE Management System for structured data entry with auto report generation.

HFW Plant:

Weld box up gradation to ensure sound welding in HFW process, essential for proper fusion in higher grade and thickness.

Installation of a new Squeeze roll force measurement system to cater to the requirement of clients such as PDO, SAUDI ARAMCO, etc.

Automated Pipe dimension measurement system for ERW pipes (Final)

Spiral-2 Plant:

Real-Time measurement of coil width and thickness during uncoiling.

Up-gradation of the Fluoroscopy system.

LSAW Plant:

Automatic Bead Profile, Bead height, and

Plate Offset Inspection.

Overhauling of the hydraulic system in JCO Press.

Up gradation of Final UT System.

Yield improvement by various initiatives through process control.

Coating Plant:

Development of a facility for 3LPE external coating on induction bends

Development of an automatic bend dimension measurement facility as per

Qatar Gas compliance.

Facility for inspection of internal surface by a high resolution camera.

Installation of a new 500 kW induction heater at ECP-3 for pipe pre-heating before shot blasting.

PBM Plant:

Expansion of the inspection bed from existing size of 8.68 m x 7.3 m to 12 m x 10 m to comply with observation made during API audit.

Bhopal Pipe & Coating Plant:

Optimization of Existing Compressor to save power cost.

Automation of Cooling Tower Fan Motors by VFD drive and temperature sensor.

Spiral Plant:

2 Nos. AC Drives (Siemens) to be commissioned at Spiral Mill Edge Miller-2 machine

New FUT and RTR Machine to be installed at SP#2 Plant

New Air conditioning system at Spiral

Offline for better results and save electronic components and power saving.

Coating Plant:

To increase port life of paints in order to prevent wastage (under discussion with Paint Supplier).

New EOT Crane commissioning.

Procurement of a new 300 mm die to reduce adhesive wastage in small sized pipes.

Automation in Coating Quenching area to save power.

Installation of an additional Graco pump in Coating plant to increase productivity of PU coating.

Mandya Pipe Plant:

1 MW rooftop solar powered system is under implementation for Mandya plant.

Installation of FUT Machine for automatic UT testing.

Digital Flat Panel Detector along with imaging software for 10 to 15% RT.

SAPIntegrationofUTMandSpectrometer.

Installation of VFDs in offline

Blowers to conserve energy.

Installation of EOT Crane - 25T in online system.

(f) Expenditure on R&D:

(i) Capital : 0.58 crore (ii) Recurring : 3.51 crore (iii) Total : 4.09 crore

(iv) Total R&D expenditure as a percentage of revenue from operations : 0.06%

(g) Total Foreign exchange earnings and Outgo:

Used - 2,642.14 crore Earned- 2,180.50 crore

14. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Disclosures as required under Rule 9 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 are annexed to this Report as

Annexure 5.

15. DIRECTORS AND KEY MANAGERIAL PERSONNEL

A) Changes in Directors and Key Managerial Personnel

Since the last report, following changes took place in the Board of Directors and Key Managerial Personnel:-

Mr. K. H. Viswanathan, Lead Independent Director resigned from the position of directorship w.e.f. July 1, 2022;

Mr. Arun Todarwal has been appointed as an independent director w.e.f. July 1, 2022 and designated as the Lead Independent Director;

Mr. Vipul Mathur was re-appointed as the Managing Director & CEO for a further period of five years w.e.f. December 1,

2022;

Mr. Deshra Dogra resigned from the position of directorship w.e.f. March 14, 2023;

Mr. Manish Chokhani has been appointed as an independent director for the first term of four consecutive years w.e.f. February 2, 2023;

Mr. Anjani K. Agrawal has been appointed as an independent director for the first term of four consecutive years w.e.f. April 1, 2023.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rajesh Mandawewala is retiring by rotation at the forthcoming Annual General Meeting andID OD being eligible, he has been recommended for re-appointment by the Board.

Details about the directors being (re)-appointed are given in the Notice of the forthcoming Annual General Meeting which is being sent to the members along with the Annual Report.

The following have been designated as the Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Mr. Vipul Mathur, Managing Director & CEO (re-appointed w.e.f. December 1, 2022);

Mr. Percy Birdy, Chief Financial

Officer;

Mr. Pradeep Joshi, Company Secretary, Compliance & Nodal

Officer.

B) Independent Directors

The independent directors have individually declared to the Board that they meet the criteria of independence as provided under Section 149(6) of the Companies Act, 2013 and the SEBI (LODR), 2015 at the beginning of the year and there is no change in the circumstances as on the date of this Report which may affect their status as an independent director.

Your Board confirms that in their opinion the independent directors fulfill the conditions of the independence as prescribed under the Companies Act, 2013 and the SEBI (LODR), 2015 and they are independent of the management.

Further, in the opinion of the Board the independent directors, possess requisite skills, expertise, experience and integrity. For details on the required skills, expertise, experience, please refer to the disclosure made under Point No. II – Board of Directors of the Corporate Governance Report annexed as Annexure 6 to this report.

The key additional criteria for independence are mapped as under:

Key Independence Criteria

AA AM AT MC RA
The director must not have been employed by the Company in an executive capacity within the last five years

 

The director must not accept or have a "Family Member who accepts any payments from the company or any parent or subsidiary of the company in excess of $60,000 during the current fiscal year", other than those permitted by SEC Rule 4200 Definitions, including i) payments arising solely from investments in the Companys securities; or ii) payments under non-discretionary charitable contribution matching programs. Payments that do not meet these two criteria are disallowed

The director must not be a "Family Member of an individual who is, or during the past three years was employed by the Company or by any parent or subsidiary of the Company as an executive officer.

The director must not be (and must not be affiliated with a company that is) an adviser or consultant to the Company or a member of the Companys senior management

The director must not be affiliated with a significant customer or supplier of the Company

The director must have no personal services contract(s) with the Company or a member of the Companys senior management

The director must not be affiliated with a not-for-profit entity that receives significant contributions from the Company

The director must not have been a partner or employee of the Companys outside auditor during the past three years

The director must not have any other conflict of interest that the board itself determines to mean they cannot be considered independent

AA – Mr. Anjani K. Agrawal, AM – Ms. Amita Misra, AT – Mr. Arun Todarwal, MC – Mr. Manish Chokhani, RA- Ms. Revathy Ashok 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 Companies Act, 2013 and shall undergo online proficiency self-assessment test, as may be applicable, within the time prescribed by the IICA.

C) Formal Annual Evaluation Background:

The performance evaluation of the Board, its committees and individual directors was conducted by the entire Board (excluding the Director being evaluated) on the basis of a structured questionnaire which was prepared after taking into consideration 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, governance and ESG parameter. The questionnaire is reviewed periodically and updated in line with the change in the business and regulatory framework. As recommended last year, such updation was done during the financial year

2022-23 by adding more probing assertions.

Mode of evaluation:

Assessment is conducted through a structured questionnaire. Each question contains a scale of "0" to "3". The Company has developed an in-house digital platform to facilitate confidential responses to a structured questionnaire. All the directors participated in the evaluation process.

For the financial year 2022-23 the annual performance evaluation was carried out by the Independent Directors, 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.

Results:

The evaluation results were discussed at the meeting of Board of Directors, Nomination & Remuneration

Committee and the Independent Directors meeting. The Directors were satisfied with the overall corporate governance standards, Board performance and effectiveness. The results are summarized below:

Key parameters

No. of evaluation parameters Score %

Board of Directors

Board structure and composition

23 92%
Board meeting practices (agenda, frequency, duration)
Board culture and effectiveness
Core Governance & Compliance
Functions of the Board (Strategic direction, ESG etc.)
Execution, Mergers & Acquisitions
Risk Management
Interest of all stakeholders
Functioning of Board Committees

Board Committees

Composition, roles & responsibilities and effectiveness of the committee

10-17 88-94%
Meeting structure and information flow
Contributions to Board decisions
Core Governance & Compliance

Independent directors

Independence from company (no conflict of interest)

12 89-93%
Independent views and judgement

Skills & Experience in emerging issues such as cyber security and ESG.

Objective contribution to the Board deliberations

Chairperson

Promote effective decision-making 8 100%
Encourage high quality of constructive debate
Open-minded and listening to the members

Effectively dealing with dissent and work constructively towards consensus

Shareholders interest supreme while taking decisions.

Executive Directors

Relevant industry experience

13 96%
Performance vis-?-vis business plan
Capabilities to deal with challenging situations
Established leadership position

Development of expertise and general competence of people under him

Non- executive

Contribution to the Board discussions with his/her expertise and experience

11 90-100%

non- independent director

Depth of understanding about the business model and the industry

Skills & Experience in emerging issues such as cyber security and ESG.

 

Board of Directors

Parameters with high performance scores:

Key suggestions / focus areas:

Sensitive to the interest of all stakeholders, including minority shareholders, and has adequate mechanism to communicate with them. Considerable attention to the quality of financial reporting process and internal financialcontrols

More time should be spent on strategic issues related to new businesses (Action Plan – More frequent and separate presentations with the CEO of each businesses to understand challenges of each business and specific strategies).

and effectively oversees them. Effective direction on key decisions impacting the performance of the Company. Monitoring of actions taken on key issues Adequate discussion on investments and M & A proposals.

Robust succession plan for the key management team (Action Plan -Develop long term succession plan considering diversity, domain expertise).

 

Board of Committees

Key focus areas for next year:

Parameters with high performance scores: Size, composition and diversity of each committee

In-depth understanding of the expectations of the stakeholders (Action Plan- Obtain and discuss feedback from various stakeholders

Strong oversight on financial reporting process, internal financial controls, potentialconflictof interest and reporting to Board on key control gaps

and invite them to present their view point to the Board Committee). Effective Communication between the Committees and the executives to discuss the

Performance monitoring of subsidiaries

issues within the Committees scope (Action

Reporting of exposure to the risks Transparent mechanism to CSR projects undertaken and the amount of expenditure Well-defined objective criteria for evaluation of the Board/ Committees/ directors Adequacy of information and effective monitoring of security transfer system

Plan- More frequent meeting with the senior executives and presentation by them on their respective functional areas). Robust succession plan for the key management team (Action Plan-Develop long term succession plan considering diversity, domain expertise).

Monitoring of actions taken on key issues

Review the process evaluating the Companys risk appetite and specific risk tolerance levels
Open and objective meeting environment in conjunction with strategic objectives (Action

Frequency of meetings are sufficient to discharge the duties assigned

Plan- Focussed discussion on the Companys risk appetite and specific risk tolerance levels in conjunction with strategic objectives

Key actions taken as a result of previous years evaluation:

The Board / Committee / Directors evaluation questionnaire has been revisited and updated in line with the emerging business and regulatory framework.

To strengthen capabilities in the Board with respect to in-depth business and commercial understanding of the B2C business control related capabilities, supply chain, global operations, composition of the Board of subsidiaries formed / acquired for new businesses have been reconstituted considering the long term objectives.

The Board and Committee meetings planned in the Annual Calendar were followed except where the unplanned meetings were convened for urgent business requirements.

Focused Risk Management Committee meetings in the presence of the CEOs of the businesses to understand challenges/ risks of each business and specific strategies.

D) Nomination and Remuneration policy: For Companys policy on Directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of directors and other matters provided under sub-section (3) of section 178, please refer to the Para IV – Nomination and Remuneration Committee of the "Corporate Governance Report" annexed to the Directors Report as Annexure 6.

E) Committees of the Board of Directors

The Board Committees play a crucial role in the governance structure of the Company and have been constituted to deal with specific areas / activities as mandated by applicable regulations; which concern the Company and need a closer review. Majority of the Members constituting the Committees are Independent Directors and each Committee is guided by its Charter or Terms of Reference, which provide for the composition, scope, powers & duties and responsibilities. The Chairperson of the respective Committee informs the Board about the summary of the discussions held in the Committee Meetings. The minutes of the Meeting of all Committees are placed before the Board for review.

During the year, all recommendations of the Committees of the Board which were mandatorily required have been accepted by the Board.

Information on the Audit Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship, Share Transfer and Investor Grievance Committee, the Risk Management Committee and the ESG & CSR Committee and meetings of those committees held during the year under Report and recommendations, if any, of the Committees not accepted by the Board is given under Para No. (III) to (VII) of the "Corporate Governance Report" annexed to the Directors Report as Annexure 6.

F) Board and Committee Meetings: For disclosure on the number of Board Meetings and Committee Meetings, the date on which the meetings were held and the attendance of each of the directors, please refer to the Para (II) to Para (VII) of the "Corporate Governance Report" annexed to the Directors Report as Annexure 6.

16. PARTICULARS OF OUTSTANDING LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186 ARE AS UNDER:

Name of the Entity / beneficiary

Investment Joint Bonds/ Security Corporate Guarantee Loans

Purpose for which the loans, guarantees and investments are proposed to be utilised

Welspun Pipes Inc.

0.04 - 246.51

The corporate guarantees were given to secure credit facilities

Welspun Tradings Limited

5.02 - - -

availed by the subsidiaries / joint ventures of your Company, to guarantee export obligations of

Welspun Captive Power

71.52 - - -

the subsidiaries / joint ventures

Generation Limited

to the custom authorities and to

Welspun Mauritius

29.85 - - -

guarantee performance of the

Holdings Limited*

subsidiaries of the Company.

Welspun Wasco Coatings Private Limited (provision made)

25.47 - 8.67 21.17

The Long-term investments are made only in subsidiaries,

Welspun Metallics Limited

472.18 283.26 1,476.00 214.93

joint-ventures and associate companies for business expan-

Welspun DI Pipes Limited

214.58 467.64 959.00 7.50

sion, business transformation as per the object clause in the Mem-

Welassure Private Limited

0.11 - - -

orandum of the Company

Welspun Global Services Limited**

0.00 - - -

Mahatva Plastic Products and Building Materials Private Limited

3.83 - - -

Anjar TMT Steel Private Limited

65.00 - 400.00 -

Welspun Specialty Solutions Limited

283.65 - 337.39 182.63
Sintex-BAPL Limited 331.05 - 150.00 -

Sintex Prefab and Infra Limited

30.27 - - -

 

Name of the Entity / beneficiary

Investment Joint Bonds/ Security Corporate Guarantee Loans Purpose for which the loans, guarantees and investments are proposed to be utilised

Nauyaan Shipyard Private Limited

87.01 - - - The corporate guarantees were given to secure credit facilities

Mounting Renewable Power Limited (provision made)

0.11 - - - availed by the subsidiaries / joint ventures of your Company, to guarantee export obligations of

Welspun Transformation Services Limited

0.57 - - - the subsidiaries / joint ventures to the custom authorities and to guarantee performance of the subsidiaries of the Company.
The Long-term investments are made only in subsidiaries, joint-ventures and associate companies for business expan- sion, business transformation as per the object clause in the Memorandum of the Company

17. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the year under Report were on an arms length basis and were in the ordinary course of business. During the year under review, your Company had not entered into any Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements. There were no materially significant related party transactions undertaken by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which might have a potential conflict with the interest of the Company at large.

Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable to the

Company for financial year 2022-23 and hence does not form part of this report. Details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the

Note No. 42 of the standalone financial statements.

The Companys policy on Related Party Transactions as approved by the Board is uploaded on the Companys website at the web-link: "http:// www.welspuncorp.com" under the tab "Investors --> Company Policies".

https://www.welspuncorp.com/uploads/investor_ data/investorreport_121.pdf

18. MANAGERIAL REMUNERATION a. Details of the ratio of the remuneration of each director to the median employees remuneration and other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Non-executive, independent directors are paid sitting fees at a fixed rate per meeting of the Board or the Committee or other meetings attended by them and as such the same are not comparable with the remuneration to the employees.

The remuneration of each Director, Chief

Financial Officer and Company Secretary, percentage increase in their remuneration during the Financial Year 2022-23 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the Financial Year 2022-23 are as under:

(Amount in crore)

Name of Director / KMP

Designation

Remuneration of Director/ KMP for the Financial Year 2021-22

Remuneration paid to Director/ KMP for the Financial Year 2022-23

% increase in Remuneration in the Financial Year 2022-23

Ratio of Remuneration of each Director to median remuneration (Including perquisite value of ESOPs exercised) of employees for the Financial Year 2022-23

1 Mr. Balkrishan Goenka$

Non-Executive Chairman 3.07 1.16 (62.21) 30.93

2 Mr. Vipul Mathur

Managing Director & CEO 6.00 6.34~ 7.89 169.05

3 Ms. Amita Misra^

Independent Director 0.177 0.157 (11.30) 4.19

4 Mr. Arun Todarwal^

Independent Director N/A 0.305 N/A 8.13

5 Mr. Deshraj Dogra^&

Independent Director 0.214 0.170 (20.56) 4.53

6 Ms. Dipali Goenka*

Non-Executive Director N/A Nil N/A N/A

7 Mr. K.H.Viswanathan^%

Independent Director 0.384 0.064 (83.33) 1.71

8 Mr. Manish Chokhani^

Independent Director N/A 0.015 N/A 0.40

9 Mr. Rajesh Mandawewala*

Non-Executive Director Nil Nil N/A N/A

10 Ms. Revathy Ashok^

Independent Director 0.163 0.134 (17.79) 3.57

11 Mr. Percy Birdy

Chief Financial Officer 1.846 2.191 22.98 N/A

12 Mr. Pradeep Joshi

Company Secretary 0.574 0.639 15.36 N/A

$ 1% Commission on the consolidated net profits of the Company is paid

^ Only Sitting fees is paid.

* Opted not to draw any remuneration or receive sitting fees. & Ceased to be a director w.e.f. March 14, 2023 % Ceased to be a director w.e.f. July 1, 2022

~ Mr. Vipul Mathur has exercised 450,000 stock options of the Company, vested during the year. The perquisite amount on exercise of these options is 4.86 crores. Remuneration excludes amortization of fair value of employee share based payments under IND-AS 102. The above figures do not include provisions for encashable leave, gratuity and premium paid for group health insurance, as separate actuarial valuation / premium paid are not available.

(The expression "median" means the numerical value separating the higher half of a population from the e list of numbers may be found by arranging all the observations from finit lowerhalfandthemedianofa lowest value to highest value and picking the middle one).

(i) The percentage increase in the median remuneration of employees in the financial year: 4.84%.

(ii) The number of permanent employees on the rolls of the Company: 2,105.

(iii) Average percentage increase /(decrease) already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentage increase/ (decrease) in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration: Aggregate remuneration of employees excluding KMP decreased by 0.23% Change in the remuneration of the KMP- increased by 11.67%.

(iv) The key parameters for any variable component of remuneration availed by the directors: 1) Cash PAT

2) Operating Cash-Flow 3) Gross Debt 4) ESG Goals

(v) Affirmation that the remuneration is as per the remuneration increment in remuneration is based on the individual performance and the Company performance for the Financial Year.

b. Details of the top ten employees in terms of remuneration drawn and the name of every other employee as required pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is as under:

Name

Designation DOB Age Completed years Joining Date Remuneration FY 22-23^ Previous Company Qualification Nature of Employment % Of Equity Shares held in the Company Relative of any Director/ Manager of the Company

1 Mr. Vipul Mathur

Managing Director & CEO 21-Mar-1970 53 2-Feb-2001 11,20,16,574 ~ Man Industries (India) Ltd MBA Permanent 0.18 No
2 Mr. Godfrey John Director# 30-Aug-1965 57 11-Jun-2012 3,71,76,143 Ferro Tech India Pvt. Ltd. MBA Permanent Negligible No

3 Mr. Tribhuwan Singh Kathayat

President 10-Jan-1971 52 20-Jun-1996 2,48,03,209 Jindal Organisation BSC, DME, MBA Permanent Negligible No
4 Mr. Percy Birdy President 22-Jan-1968 55 11-Jun-2018 2,19,12,183 Allanasons Group CWA, CA Permanent Nil No

5 Mr. Navin Agarwal

Senior Vice President 1-Jan-1972 51 2-Jun-2008 1,46,15,924 Mahindra & Mahindra Ltd. B.Com (Hons), PGDBM Finance Permanent Nil No
6 Mr. Nitin Agarwal Vice President 6-Feb-1983 40 20-Apr-2007 1,38,47,764 Welspun Tubular LLC MBA, PGDM Permanent Nil No
7 Mr. Manish Pathak President 20-Jan-1968 55 26-Jun-2008 1,24,31,650 Man Industries (India) Ltd BE Mech Permanent Nil No

8 Mr. Suresh Chander Darak

President 2-Jan-1968 55 2-Jan-2008 1,23,95,962 Reliance Industries Ltd. B. Com, DITM Permanent Nil No

9 Mr. Vijay Manjrekar

Vice President 24-Jun-1978 44 7-Jun-2021 1,23,20,000 Lodha Group B.Com, LL.B., DIP CUSTOM & EXCISE Retainer Nil No
10 Mr. Rupak Ghosh President 17-Oct-1969 53 29-Oct-2007 1,22,28,141 Blue Star Ltd. CA, CWA Permanent Negligible No

11 Mr. Anil Nimbargi

Senior Vice President 13-Oct-1965 57 9-Sep-2009 1,13,97,448 Ispat Industries B.Sc , MBA Permanent Nil No
12 Mr. Atul Trivedi President 3-Jan-1974 49 14-May-2007 1,07,15,841 Tata Consultancy CA Permanent Nil No

13 Mr. Gaurav Merchant

Vice President 11-Sep-1973 49 15-Jan-2014 1,02,55,375 Essar Steel Ltd. B.Com., MBA Finance Permanent Nil No

14 Mr Chintan Thaker

President 18-Dec-1977 46 01-Apr-03 51,82,850 Gujarat Infra B.Sc+MBA Marketing Permanent Nil No
15 Mr. Abhijeet Shinde* Vice President 19-Jul-1983 39 5-Dec-2022 50,83,660 Lodha Group LLM Retainer Nil No

16 Mr. Priyaranjan Kumaar*

President 2-Aug-1969 53 4-Jan-2023 41,71,233 Navin Fluorine International Ltd B.Sc, BGL, MBA - HR Permanent Nil No

17 Mr. Neeraj Kant*

Retainer Director# 17-Aug-1963 59 9-Feb-2023 34,93,151 Indian Steel & Wire Products Ltd. (ISWP) BE, MBA Permanent Nil No

~ Mr. Vipul Mathur has exercised 450,000 stock options of the Company, vested during the year. The remuneration is inclusive of perquisite amount on exercise of these options..

^ The remuneration is inclusive of perquisite amount on exercise of the options. The Remuneration excludes amortization of fair value of employee share based payments under

IND-AS 102. The above figures do not include provisions for encashable leave, gratuity and premium paid for group health insurance, as separate actuarial valuation / premium paid are not available.

* Employed for a part of the year. # Not on the board of the Company.

c. Managing Director of the Company was not in receipt of any commission from the Company and at the same time, remuneration or commission from the Companys Subsidiary Company. d. Particulars of remuneration to the executive directors including the details of remuneration paid/payable to the executive directors for the financial year 2022-23 are as under:

Name of the Director

Salary & Allowance Perquisites Commission Service Contract/ Tenure performance linked incentives Notice Period Severance Fees Stock Option Pension

Mr. Vipul Mathur

6.34 Crore^ 4.86 crore~ Nil 5 years Nil 1 month Nil Refer note below Nil

^ In addition to salary & allowance, entitled for other benefits as per the Companys policy.

~ Mr. Vipul Mathur has exercised 450,000 stock options of the Company, vested during the year. The perquisite amount on exercise of these options is 4.86 crores. Remuneration excludes amortization of fair value of employee share based payments under IND-AS 102. The above figures do not include provisions for encashable leave, gratuity and premium paid for group health insurance, as separate actuarial valuation / premium paid are not available.

Note: 15,00,000 Employee Stock Options granted during FY 2018-19 at an exercise price of 100 per option and can be exercised as per the vesting schedule given under the Welspun Employee Stock Option Plan which is 30%, 35% and 35% each year, from the end of 1st year from the grant date. Exercised 4,50,000 ESOPs during the financial year

2022-23. Further, during the Financial Year 2022-23, 11,00,000 Employee Stock Options were granted at an exercise price of 100 per option and can be exercised as per the vesting schedule given under the Welspun Employee Stock Option Plan which is 30%, 35% and 35% each year, from the end of 1st year from the grant date.

Mr. Balkrishan Goenka, Non-Executive Chairman was paid Commission of 3.07 crores (Gross) i.e. @1% of the Net Profits

(consolidated) for the Financial Year 2021-22 in terms of the approval granted by the members of the Company at the 27th Annual General Meeting held on July 29, 2022. The

Commission payable @1% of the Net Profits (Consolidated) for the financialyear 2022-23 is 1.16 crores.

No remuneration or perquisite was paid to, and no service contract was entered into with, or stock options granted to any non-executive director, but the sitting fees were paid / payable to the following directors for attending meetings of Board / Committees of the Board and General Meetings. Only Letter of Appointment were issued to the independent directors.

Name of the Director

()
1 Ms. Amita Misra 15,70,000
2 Mr. Arun Todarwal 30,50,000
3 Mr. Desh Raj Dogra 17,04,000
4 Mr. K. H. Viswanathan 6,42,000
5 Mr. Manish Chokhani 1,50,000
6 Mrs. Revathy Ashok 13,38,000

Total to Non-Executive

84,54,000

Directors

The above mentioned sitting fee paid / payable to the non-executive directors was within the limits prescribed under the Companies Act, 2013 for payment of sitting fees. Hence prior approval of the members as stipulated under Regulation 17(6) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was not required.

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

19. SHAREHOLDING OF THE DIRECTORS OF THE COMPANY AS ON MARCH 31, 2023.

For detail of shareholding of the directors, refer to the Para No. II – Board of Directors in the Corporate Governance Report annexed to this Report as Annexure 6.

Except as mentioned in the "Corporate Governance Report", none of the other directors hold any shares or convertible securities in the Company.

20. CORPORATE GOVERNANCE CERTIFICATE

The Compliance certificate obtained from M/s.

Mihen Halani & Associates, Practicing Company Secretary regarding compliance of conditions of corporate governance as stipulated under Chapter IV read with relevant Schedule to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed with this Report.

21. RISK MANAGEMENT POLICY

With its fast and continuous expansion in different areas of businesses across the globe, the Company is exposed to plethora of risks which may adversely impact growth and profitability.

The Company recognizes that risk management is of concern to all levels of the businesses and requires a structured risk management policy and process involving all personnel. With this objective, the Company had formulated structured Risk Management Policy thereby to effectively address those risks such as, strategic, business, regulatory and operational risks, including cyber security & data Privacy risks. The Policy envisages identification of risks by each business segment and location, together with the impact that these may have on the business objectives. It also provides a mechanism for categorization of risks into Low, Medium and High according to the severity of risks. The risks identifiedare reviewed by a committee of the Managing Director & CEO of the Company and the relevant senior executives and the appropriate actions for mitigation of risks are advised; the risk profile is updated on the basis of change in the business environment. The Risk Management Committee, periodically reviews the risk management process, risks and mitigation plans and provide appropriate advise in the improvement areas, if any, identified during the review.

For the key business risks identified by the

Company, please refer paragraph on Enterprise Risk Management in Management Discussion and Analysis annexed to this Report.

22. VIGIL MECHANISM FOR DIRECTORS AND

EMPLOYEES

For Companys policy on establishment of Vigil Mechanism for directors and employees, please refer to the Para VIII - Details of Establishment of Vigil Mechanism for Directors and Employees of the "Corporate Governance Report" annexed to the Directors Report as Annexure 6.

23. FAMILIARIZATION PROGRAM FOR

INDEPENDENT DIRECTORS

The Directors of the Company are provided opportunities to familiarize themselves with the Company, its Management and its operations. The Directors are provided with all the documents to enable them to have a better understanding of the Company, its various operations and the industry in which it operates.

The roles and responsibilities of the Independent Directors of the Company are informed to them at the time of their appointment through a formal letter of appointment, which also stipulates various terms and conditions of their engagement.

Presentations are made to the Board, where Directors get an opportunity to interact with Senior Management. Directors are also informed of the various developments in the Company through Press Releases, emails, etc.

Pursuant to Regulation 25(7) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Company organized various familiarization programs for its Directors including Industry Outlook, Presentations on Internal Control over Financial Reporting, Regulatory updates, Prevention of Insider Trading Regulations, Framework for Related Party Transactions, Plant Visit, Meeting with Senior Executive(s) of your Company, Corporate Social Responsibility Strategy etc.

The details of familiarization program (for independent directors) are disclosed on the website of the Company at the web-link: "http:// www.welspuncorp.com" under the tab "Investors -> Company Policies".

https://www.welspuncorp.com/uploads/investor_ data/investorreport__779.pdf

During the reporting year, on a cumulative basis, the independent directors spent ~80 hours on several familiarization program. During the year, the Company also conducted a separate sessions on ESG familiarization, new business familiarization for directors as part of the committee meetings.

24. CODE OF CONDUCT

Your Company has a Code of Conduct for the Board members and Senior Management Personnel. The Companys Code of Conduct outlines the commitment to principles of integrity, transparency, conflict of interest and fairness that employees, suppliers, distributors and other third parties who work with the Company must comply.

Your Company also has clearly defined policies and procedures, covering areas such as Anti-Bribery and Anti-Corruption, Retention and Monitoring of Third-Party Representatives, Gifts, Travel and Accommodation (Boarding and Lodging), Meals, Entertainment and Other Hospitality, Charitable Contributions and Sponsorship Involving

Government Officials or Government Entities,

Political Contributions, Suppliers, Vendors &

Other Third Parties, specifically recommended by Government Officials,Employment Requests from Government Officials, Facilitating Payments.

A copy of the Code has been put for information of all the members of the Board and management personnel on the website of the Company at the web-link: "http://www.welspuncorp.com" under the tab "Investors -> Company Policies".

https://www.welspuncorp.com/uploads/investor_ data/investorreport__117.pdf

All the members of the Board and the Senior

Management Personnel have affirmed with the same.

A declaration signed by the Managing Director & CEO of the Company is given below:

I hereby confirm that the Company has obtained from all the members of the Board and the Senior

Management Personnel, affirmation that they have complied with the Code of Conduct for the financial year 2022-23.

Sd/-

Vipul Mathur

Managing Director& CEO

DIN: 07990476

25. MISCELLANEOUS DISCLOSURES a) Except as mentioned in this Report with respect to acquisitions, during the year under Report, there was no change in the general nature of business of your Company. b) Except as mentioned in this Report, no material change or commitment has occurred which would have affected the financial position of your Company between the end of the financial year of your Company to which the financial statements relate and the date of the Report. c) Except as mentioned in the Para XVI (c) – Non-Compliance of the Corporate Governance Report annexed to this Report, no penalty or strictures were imposed on the Company by the Stock Exchanges or SEBI or any statutory authority. The Board noted the inadvertent delay in submission as mentioned above and advised furnishing the intimation with respect to date of payment of interest to Non-Convertible Debenture holders of all series of

NCDs at the beginning of the financial year. d) No significant and material order was passed by the regulators or courts or tribunals which would have impacted the going concern status and your Companys operations in future. e) Your Company has not made any provision of money for the purchase of, or subscription for, shares in your Company, to be held by or for the benefit of the employees of your Company and hence the disclosure as required under Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 is not required. f) 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. g) The Company has not made any one-time settlement for loans taken from the Banks or Financial Institutions, and hence the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable. h) There was no revision of financial statements and Boards Report of the Company during the year under review. i) The Company has a detailed Policy on Prevention of Sexual Harassment (POSH Policy) in place in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. The POSH Policy is gender inclusive, and the framework ensures complete anonymity and confidentiality. j) The Company has organized induction training for new joiners, online training and refresher modules, virtual and classroom trainings, emailers and posters to sensitise the employees to conduct themselves in manner compliant with the POSH Policy. k) The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The ICC comprises of internal as well external members. l) 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-off during the financial year: N/A

number of complaints pending as at end of the financial year: Nil m) For detail of the Nodal Officer appointed by the Company under the provisions of IEPF and the web-address on which the details are available, please refer to the Point 11 of Para XVIII – General Shareholders Information of the "Corporate Governance Report" annexed to the Directors Report as Annexure 6

26. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2013, your directors hereby confirm that: a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. 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 and of the profit and loss of the Company for that period; c. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. the directors had prepared the annual accounts on a going concern basis; e. being a listed company, 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; and f. 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.

ACKNOWLEDGEMENTS

Your directors express their deep sense of gratitude to all stakeholder, bankers, business associates, contractors, customers, employees, government authorities, joint venture partners, suppliers for the support received from them during the year and look forward to their continued assistance in future.

For and on behalf of the Board of Directors

Vipul Mathur

Balkrishan Goenka
Managing Director & CEO Chairman
DIN : 07990476 DIN: 00270175
Place: Mumbai
Date: May 30, 2023