Maral Overseas Ltd

Your Directors are pleased to present the Thirty Sixth (36th) Annual Report of your Company on business and operations along with the Audited Financial Statements and the Auditor's Report thereon for the financial year ended 31st March, 2025.

1. Financial Results

The Financial performance of the Company for the year ended 31st March, 2025 is summarized as below:

(Rs. in Lakh)

2. Operational Performance

The Directors of your Company inform the members that the textile industry witnessed a gradual recovery in demand during the year under review, leading to improved capacity utilization across both the yarn and fabric segments. Despite this positive trend, the spinning division continued to face margin pressure due to an oversupply situation, and particularly affecting the basic grey yarn segment, where margins were severely impacted. The softness in international cotton prices further weighed on margins for basic yarns. Flowever, value-added and sustainable yarns performed relatively better, contributing stronger margins. During the year, the spinning division operated at 89% capacity, primarily due to a strategic decision to reduce the production of those yarns, where realizations did not justify marginal or variable costs. Further, Melange yarn business established a solid foundation supported by increased customer engagement in both domestic and specific international markets. The Company's resulted consistent volume growth in last quarter of FY25, resulted in full capacity utilization by the end of the financial year.

In the fabric segment, overall performance was impacted by subdued global demand and pricing pressures, particularly during the first three quarters. The Company has set ambitious targets for the fabric division, focusing on improved capacity utilization and enhanced realizations. With regard to the Garment segment, the business outlook remained positive across key customers, with improved engagement from a leading customerthrough an expanded range of categories, fabrics, and styles. The Company also aims to strengthen collaborations with premium brands in the US and EU. In view of the cost optimization strategy to enhance profitability and operational efficiency, the Company consolidated the operations of its Garment Unit located at A-11, Hosiery Complex, Phase-ll (Extension), Noida - 201305, with its existing Units at D-347, Sector 63, Noida - 201301, and A-37, Sector 64, Noida - 201301. Further, after consolidation of the said Unit, the lease shall be discontinued with effect from 15th April, 2025.

Your Company achieved a turnover of Rs.1,04,703 Lakh for the year ended 31st March, 2025 against Rs.96,006 Lakh in the previous year ended 31st March, 2024. Further, the Company achieved an operational profit of Rs.4,522 Lakh as against Rs.5,975 Lakh in the previous year. The Company recorded a Net Loss of Rs.2,420 Lakh as against a Net loss of Rs.977 Lakh reported in the previous year.

During the period under review, your Company recorded a production of 16,337 MT of grey yarn (FY24 17,155MT), 3,183 MT of dyed yarn (FY24 2,852 MT), 4,026 MT of grey knitted fabric (FY24 3,551 MT), 5,879 MT of processed fabric (FY24 4,978 MT), 2,510 MT of Melange Yarn and 44.12 Lakh pieces of garments (FY24 36.05 Lakh pieces).

During the year under review, the Company's exports (FOB value) were to the tune of Rs.46,435.12 Lakh (FY24 Rs.43,153 Lakh) and accounted for 44.35% (FY24: 44.95%) of the Company's turnover. The yarn business accounted for 51.77% (FY24: 53.87%) while knitted fabric and garment business accounted for 25.84% (FY24: 24.17%) and 22.39% (FY24: 21.96%) respectively.

3. Modernization, Expansion and Diversification

Your Directors in their previous report had informed the members about a modernization program comprising of Spinning, Processing, Knitting and Bio Fuel Boiler and Thermic Fluid Heater at a capital outlay of Rs.22.18 Crores at its Sarovar Plant. During the previous year, the said modernization program of Rs.22.18 Crores had been fully completed and the Company started deriving benefits from the same.

Your Directors take pleasure in informing members that in order to enhance value and adapt to evolving market demands, during the year under review, the Company identified another capital expenditure plan of Rs.30.66 Crores for modernization, replacement of machinery and capacity additions in Yarn Dying Department and Dye house process fabric at the Sarovar plant. This will enhance capacity, efficiency and customer satisfaction, ultimately driving business growth and sustainability.

4. Number of meetings of Board of Directors

The particulars of the meetings of Board of Directors held during the year, along with details regarding the meetings attended by the Directors forms part of Corporate Governance Report. The composition of Board and its Committees has also been provided in detail in Corporate Governance Report.

5. Dividend and Other Appropriations

In view of the financial position of the Company during the year under review, the Board of Directors have not recommended any dividend on the Equity Shares of the Company.

6. Corporate Social Responsibility

Your Company considers Corporate Social Responsibility ('CSR') and sustainability initiatives and practices, as an important element of doing business, as a responsible corporate citizen. Your Company has been involved with social initiatives and engages in various activities in the fields of education, healthcare and community upliftment.

CSR initiatives and activities of the Company are aligned to the requirements of Section 135 of the Companies Act, 2013. The composition and terms of reference of the CSR Committee are given in the Corporate Governance Report. The Annual Report on the CSR initiative undertaken by the Company as per the Companies (Corporate Social Responsibility Policy) Rules, 2014, is annexed as Annexure I forming part of this Report. The Company's Corporate Social Responsibility Policy as approved by the Board of Directors is disclosed on the website of the Company at https://www.maraloverseas.com/policy/MOL CSR_Policv.pdf.

7. Annual Return

Pursuant to Section 92 of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, Annual Return for the financial year 2024-25, is available on the website of the Company at https://maraloverseas.com/ annualreturn.php.

8. Directors and Key Managerial Personnel

The Board of Directors of your Company as on date of this report comprises Seven (7) directors, of which one (1) is a Chairman & Managing Director and CEO, one (1) Joint Managing Director, one (1) Non-Independent & Non- Executive Director and four (4) Directors are Non-Executive & Independent Directors.

Pursuant to provisions of Section 152 of the Companies Act, 2013, Shri Shantanu Agarwal (DIN-02314304) is liable to retire by rotation and being eligible offers himself for re-appointment at the 36th Annual General Meeting of your Company.

Your Directors further inform the members that pursuant to the provisions of Section 149(7) of the Companies Act, 2013, a declaration has been received from the Independent Directors at the beginning of the financial year stating that the criteria of independence have been met as specified under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1 )(b) and 25(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended form time to time.

During the year under review, Smt. Romi Jatta (DIN: 10045383), Shri Amitabh Gupta (DIN: 01646370), and Shri Raman Singh Sidhu (DIN: 00121906) were appointed as Independent Director with effect from 1st August, 2024 initially for a term of five consecutive years and their appointments was approved by the members at the 35th Annual General Meeting held on 27th August, 2024 by passing of Special Resolution(s). Further, as per the Special Resolution(s) passed by members of the Company through postal ballot on 20th March, 2025, Shri Shekhar Agarwal (DIN: 00066113) was re-appointed as Managing Director for a period of 3 years with effect from 1st April, 2025 and continue to hold the position of Chairman & Managing Director & CEO of the Company; and Shri Shantanu Agarwal (DIN: 02314304) was re-appointed as Joint Managing Director for a period of 3 years, with effect from 19th June, 2025.

During the year under review, Dr. Kamal Gupta (DIN: 00038490) and Shri Priya Shankar Dasgupta (DIN: 00012552), both had completed their tenure towards second term and consequently ceased to be Independent Directors of the Company with effect from close of business hours on 25th September, 2024.

Shri Shekhar Agarwal, Chairman & Managing Director and CEO, Shri Shantanu Agarwal, Joint Managing Director, Shri Manoj Gupta, Chief Financial Officer and Shri Sandeep Singh, Company Secretary & Compliance Officer are the Key Managerial Personnel of the Company as on 31st March, 2025.

None of the Directors of the Company are disqualified as per the provisions of Section 164 of the Companies Act, 2013. Further, none of the Directors are debarred from holding the office of Director pursuant to any SEBI Order or any other such authority. The Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

9. Nomination and Remuneration Policy

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and Regulation 19 read with Schedule II Part D of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Nomination and Remuneration Policy had been framed for the appointment of Directors, Key Managerial Personnel and Senior Management and fixation of their remuneration. The Nomination and Remuneration Policy of the Company is annexed as Annexure II and forms part of this Report.

Your Directors inform the members that the Nomination and Remuneration Committee as well as your Directors endeavor to follow the policy and all appointments in Board and Senior Management are considered at the meeting of the Committee and the Board.

10. Annual Evaluation by the Board

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annual evaluation has been done by the Board of its own performance, its Committees and individual Directors. The manner of evaluation is mentioned in the Nomination and Remuneration policy which forms part of this Report. Your Directors feel pleasure in informing the members that the performance of the Board as a whole and its members individually was adjudged satisfactory.

Further, every Independent Director of the Company is familiarized with the Company, their roles, rights, responsibilities in the Company, nature of industry in which Company operates, business model of the Company, etc., through various programs.

11. Auditors

Statutory Auditor

S S Kothari Mehta & Co. LLP, Chartered Accountants, (Firm Registration No. 000756N/N500441) were appointed as Statutory Auditors of the Company for the second term of five consecutive years, commencing from the conclusion of 33rd Annual General Meeting ('AGM') held on 25th August, 2022 till the conclusion of 38th AGM of the Company to be held in the year 2027. S S Kothari Mehta & Co. LLP, Chartered Accountants, have confirmed their eligibility under section 141 of the Companies Act, 2013 and rules framed thereunder.

During the year under review, the Auditor did not report any matter under Section 143(12) of the Companies Act, 2013; therefore, no detail is required to be disclosed under Section 134(3) (ca) of the Companies Act, 2013. The observations of the Auditor, if any, are explained wherever necessary, in the appropriate notes to the accounts. The Statutory Auditor's Report does not contain any qualification, reservation or adverse remark, disclaimer or emphasis of matter.

Internal Auditors

Pursuant to Provisions of section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Company had appointed M/s. GSA & Associates, LLP, Chartered Accountants and M/s. Arvind Kaul and Associates, Chartered Accountants as Internal Auditors of the Company for the financial year 2024-25 for Sarovar Plant and Garment Units respectively.

The role of Internal Auditors includes but is not limited to review of internal systems, standard operating procedures, adherence to statutory laws & other operational norms as set by the management, monitoring of implementation of corrective actions required, reviewing of various policies and ensure its proper implementation, etc.

Secretarial Auditor

Pursuant to provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. Manisha Gupta & Associates, Practicing Company Secretaries, as Secretarial Auditor of the Company for the year ended 31st March, 2025. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. The Report of Secretarial Auditor is annexed as Annexure III forming part of this Report.

Further, pursuant to the provisions of Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 204 of the Companies Act, 2013 and rules made thereunder, the Audit Committee and the Board of Directors have approved and recommended the appointment of M/s. Manisha Gupta & Associates, Peer Reviewed Firm of Company Secretaries in Practice (Firm Registration Number: 3290/2023) as Secretarial Auditors of the Company for a term of upto 5(five) consecutive years to hold office from the conclusion of ensuing 36th Annual General Meeting ("AGM") till the conclusion of 41st Annual General Meeting of the Company to be held in the year 2030, for approval of the members at ensuing AGM of the Company. Brief profile and other details of M/s. Manisha Gupta & Associates, Company Secretaries in Practice, are separately disclosed in the Notice of 36th AGM.

M/s. Manisha Gupta & Associates have given their consent to act as Secretarial Auditors of the Company and confirmed that they are not disqualified to be appointed as Secretarial Auditors in terms of provisions of the Companies Act, 2013 & Rules made thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Cost Auditor

Pursuant to provisions of Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014 as amended, the Board of Directors of the Company on the commendation of Audit Committee had approved the appointment of M/s. K. G. Goyal & Co. as Cost Auditor to conduct the audit of cost records for the year ended 31st March, 2025.

12. Particulars of Loans, Guarantees or Investments

Details of loans, guarantees and investments are given in the notes to the financial statements at appropriate places.

13. Particulars of Contracts or Arrangements with Related Parties

During the financial year all contracts/arrangement/ transactions entered into by the Company with related parties were in compliance with applicable provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Prior Omnibus approval of the Audit Committee was obtained for all related party transactions, which are foreseen and repetitive in nature. Pursuant to the said omnibus approval, details of transactions entered into are also reviewed by the Audit Committee and the Board of Directors on a quarterly basis.

All related party transactions entered into by the Company during the financial year with related parties were on arm's length basis at prevailing market price and in the ordinary course of business. During the financial year, there was no material contract or arrangement entered into by the Company with any of the related parties. Your Directors draw attention of the members to note no. 40 to the financial statements which contain particulars with respect to related parties. The policy on dealing with the related party transactions as approved by the Board of Directors is disclosed on the website of the Company under the following link: https:// maraloverseas.com/policy/Related%20Party%20 Transactions%20policy.pdf

14. Significant and Material Orders Passed by the Regulators or Courts

There was no significant and material order passed by the regulators or courts during the year under review.

15. Risk Management

Your Company recognizes that risk is an inherent aspect of business and is committed to managing it proactively and effectively. Accordingly, your Company has adopted Risk Assessment and Mitigation Policy, as amended and approved by the Board of Directors, for identification, assessment and mitigation of the risks. The Policy outlines comprehensive framework for categorizing risks into External, Internal and Other Risks. Identified risks are systematically addressed through mitigating actions on a continuous basis. The Company endeavor to continuously sharpen its Risk Management systems and processes in line with rapidly changing business environment. The Company, through its risk management process, aims to contain the risks within its risk appetite. Further, the policy aims at creating and protecting shareholders' value by minimizing threats, weaknesses and identifying and maximizing opportunities. Pursuant to the policy, your Directors periodically review the risks associated with the business or which threaten the prospects of the Company.

16. Corporate Governance

Your Company has a rich legacy of ethical governance practices and is committed to transparency in all its dealings and places high emphasis on business ethics. Your Company always emphasising on managing its affairs with diligence, transparency, responsibility and accountability thereby upholding the important dictum that an organization's corporate governance philosophy is directly linked to its performance. The Company understands and respects its fiduciary role and responsibility towards its stakeholders and to the society at large, and strives to serve their interests, resulting in creation of value for all stakeholders.

A report on Corporate Governance along with the Certificate of Statutory Auditors confirming compliance of Corporate Governance as stipulated under point E of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended, forms an integral part of this Annual Report.

17. Whistle Blower Policy

The Vigil Mechanism as envisaged in the Companies Act 2013, the Rules prescribed thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are captured in the Company's Whistle Blower Policy to enable all the stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism. The Company has appointed a Nodal Officer to whom the complaints can be made. In exceptional cases an opportunity is provided to the Whistle Blower to make a direct appeal to the Chairperson of the Audit Committee. All employees shall be protected from any adverse action for reporting any unacceptable or improper practice and/or any unethical practice, fraud, or violation of any law, rules, or regulations. The policy has been disclosed on the website of the Company at https://www.maraloverseas.com/policy/Whistle%20 Blower%20Policy.pdf.

18. Management Discussion and Analysis Report

Management Discussion and Analysis Report, as required under Schedule V read with Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, forms part of this Annual Report.

19. Internal Control Systems

Your Company maintains adequate Internal Control system and procedures commensurate with its size and nature of operations of the Company. The Company's governance framework is designed to enhance performance predictability, business continuity and ensure organization-wide compliance with all relevant laws of the land. Internal Control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorization of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances. Internal Controls also facilitate optimum utilization of resources, protect Company's assets and stakeholder's interests. Internal Auditors also ensure proper compliance of all policies and Standard Operating Procedures (SOPs) adopted by the Company. Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.

20. Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

Your Directors inform the members that your Company continuously evaluates various energy conservation measures in all areas of operation across all its manufacturing plants. The information required to be disclosed pursuant to Section 134(3) (m) of the Companies Act, 2013 read with the Rules, 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure-IV forming part of this Report.

21. Particulars of Employees

The information pursuant to Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure-V forming part of this Report.

Further, disclosures pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The relevant Statement is annexed as Annexure-VI forming part of this Report.

22. Significant material changes after balance sheet date affecting financial position

There is no change which affects the financial position of the Company between the end of the financial year of the Company to which the financial statements relate i.e. 31st March, 2025 and the date of Report i.e. 8th May, 2025.

23. Subsidiaries, Joint Ventures and Associates Companies

The Company does not have any Joint Ventures, Subsidiaries and Associate Companies.

24. Public Deposit

During the year under review, your Company has not accepted any public deposit within the meaning of provisions of section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and there is no outstanding deposit due for repayment.

25. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

In line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has complied with provisions relating to the constitution of Internal Complaints Committee for reporting concerns with regard to sexual harassment at workplace.

Your Directors inform the members that during the year under review, Internal Complaint Committee did not receive any complaint with regard to sexual harassment.

26. Directors' Responsibility Statement

Pursuant to Section 134(3) (c) of the Companies Act, 2013, the Directors state that:

a. in the preparation of the annual accounts, applicable accounting standards have been followed and no material departures have been made from the same;

b. appropriate accounting policies have been applied consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31st March, 2025 and of the profit and loss for the year ended 31st March, 2025;

c. proper and sufficient care has been taken 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 annual accounts have been prepared on a Going Concern basis;

e. proper internal financial controls were in place and financial controls were adequate and were operating effectively;

f. the systems to ensure compliance with the provisions of all applicable laws were in place, adequate and operating effectively.

27. Disclosure of Accounting Treatment

The Company has followed the same accounting treatment as prescribed in the relevant Indian Accounting Standards while preparing the Financial Statements.

28. Transfer to Investor Education and Protection Fund

In terms of the provisions of Section 124 and 125 of the Companies Act, 2013 read with the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, there was no unclaimed amount or shares during the financial year that were required to be transferred to the Investor Education and Protection Fund (IEPF) established by the Central Government.

Details of unpaid / unclaimed amount of dividend pertaining to financial year 2021-22, are available at the website of the Company at https:// www.maraloverseas.com/unpaid&unclaimeddivened. php. Pursuant to Section 124 and 125 of the Companies Act, 2013, dividend that are unpaid or not claimed within a period of 7 (seven) consecutive years from the date of transfer to the Unpaid Dividend Account of the Company, are liable to be transferred by the Company to the Investor Education and Protection Fund ("IEPF"). Further, according to said IEPF Rules, shares in respect of which dividend remains unpaid/ unclaimed by the shareholder(s) for 7 (seven) consecutive years shall also be liable to be transferred to the Demat account of the IEPF Authority. Therefore, the Company requests all the members to encash/ claim their unpaid/ unclaimed dividend within the prescribed time.

29. Compliance with Secretarial Standards

The Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.

30. General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions in these items during the financial year under review:

i. Issue of equity shares with differential rights as to dividend, voting or otherwise.

ii. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

iii. No amount has been transferred to General Reserves during the year.

iv. There was no change in the nature of business of the Company.

v. There was no fraud detected which has been reported to the Audit Committee / Board of Directors as well as to the Central Government.

31. Acknowledgements

Your Directors place on record their acknowledgement and sincere appreciation to all our clients, customers, vendors, dealers, bankers, investors, other business associates, Central and State Governments for their continued support and encouragement during the year and their confidence towards the management. Your Directors would also like to thank employees at all levels fortheir hard work, dedication and commitment.