NOCIL Ltd

Dear Stakeholders,

It is indeed my privilege to present the Annual Report of the Company for the financial year 2023-24 and I must begin my note by thanking all our employees, shareholders, customers, business partners and investors for their solid continued support which has helped the Company demonstrate resilience and adaptability throughout the fiscal year despite facing external pressures such as aggressive market competition, subdued demand in the global markets, geopolitical tensions, and fluctuating raw material prices. The most notable feature for the year under review is our dedication to stability and foresight with strategic investments, innovation, and robust ESG initiatives, and this has ensured that we are firmly entrenched in our mission to create enduring value for our stakeholders and contribute positively to the environment and society, thereby laying solid

Macroeconomic Landscape

As we look back over the past year, it's crucial to recognise the global challenges that have shaped our economic landscape. Supply chain disruptions, the prolonged conflict between Russia and Ukraine, the Middle East crisis and significant inflation spikes have rigorously tested business resilience worldwide.

Closer home, India's economy has stood out as a beacon of resilience, having grown by an impressive 8.2% in 2023-24. Indian economy is on its growth path towards becoming a USD 7 Tn economy by around 2030, on the back of growth drivers such as robust export growth, increased investments in infrastructure, and strong consumption.

Strategic Response: Navigating Challenges with Foresight

NOCIL's strengths lie in its integrated value chain, technological advancements, extensive product range, and strong marketing & technical service and extensive distribution channel. Our commitment to R&D and innovation has enabled us to stay ahead of industry trends and deliver high-quality products consistently. These operational strengths are fundamental to our strategy and provide a 'stable' foundation for sustainable growth.

Financial and Operational Performance Highlights

For the financial year 2023-24, our consolidated net revenue from operations stood at Rs. 1,445 Crores, compared to Rs. 1,617 Crores in the previous year. The decline can be attributed to a significant reduction in average selling prices primarily due to an aggressive approach adopted by the Chinese players followed by other players from EU, Korea and USA. In the same period, we achieved a year-on-year volume growth of 9% in the export segment, highlighting our robust performance in international markets. NOCIL demonstrated resilience and adaptability with a continued focus on operational excellence initiatives in manufacturing, leading to significant improvements in utilities and operational e_ciencies, thus achieving an operating EBITDA of

Rs. 195 Crores, with an EBITDA margin of 13.5%, reflecting the Company's ability to navigate a complex market environment.

Your Company has remained debt free for the 7^th year in succession by its apt and judicious utilisation of resources and generation of cash profits during the whole year. Your Company also continues to enjoy ‘stable ‘credit rating from the top credit rating agencies thereby indicating a robust financial health of the Company. Despite some disappointment in terms of fall in PAT, the Board of Directors of the Company remain firmly committed to uphold shareholder value by adopting a consistent dividend of 30% for the third year in succession.

Commitment to Long-Term Goals: Investing in Sustainable Growth

Our confidence in future growth is reinforced by a Rs. 250 Crores capital investment aimed at enhancing capacity. Our capital expenditure plan demonstrates our commitment to investing in future growth and expanding our capabilities.

Our confidence in future growth is reinforced by a Rs. 250 Crores capital investment aimed at enhancing capacity. Our capital expenditure plan demonstrates our commitment to investing in future growth and expanding our capabilities

Driving Sustainable Change: Our Commitment to Sustainability

Sustainability is integrated into our operations, focussing on reducing our environmental impact through

‘Responsible Care' principles and ‘Green Chemistry'. NOCIL is one of the 86 companies in India that holds a certification for ‘Responsible Care' – the Global Chemical Industry's initiative, focussed on

Environmental, Health, and Safety (EHS) improvements since 2018. Additionally, our social responsibility initiatives align with our strategic pillars, engaging with communities and supporting healthcare, education, rural development, and environmental conservation. We prioritise energy e_ciency and utilise hybrid power to reduce greenhouse gas emissions, with more than 25% of our electricity at one facility coming from renewable sources. Our commitment to sustainable operations is reflected in the implementation of the '5S Workplace Organisation Method' and the '3Rs' strategy (Reduce, Reuse, Recycle). These initiatives help us maintain top HSE (Health, Safety, and Environment) standards.

Empowering Communities: Our CSR Initiatives

NOCIL's commitment to Corporate Social Responsibility (CSR) is driven by our promoter group's philosophy,

‘More than an Obligation, more than a Duty.' Our robust CSR policy identifies key stakeholders and focusses on the eradication of hunger and poverty, promoting healthcare and education in rural areas, supporting women from economically weaker sections su_ering from breast cancer, and promoting sports.

Recognised Excellence: Awards and Accolades

Our e_orts have not gone unnoticed.

NOCIL received 6 (six) awards for Best Sustainability Initiatives at the 2^nd India Sustainability Conclave and Awards 2023, recognising our contributions to improving EHS, energy e_ciency, poverty reduction, education promotion, and rural healthcare. We also received the prestigious Economic Times-Legal (ET-Legal) award for Best Legal Support to CSR Initiatives and the League of American Communication Professionals (LACP) Platinum Award for Best Sustainability Report in the Chemicals Sector. Apart from this we were bestowed with prestigious CNBC TV-18 award for Best Regulatory Compliance Management in the mid-cap sector.

Future-Focussed: Building a Sustainable Tomorrow

As we look ahead, our vision extends beyond traditional boundaries. We are committed to exploring new avenues and expanding our horizons beyond tires, tapping into non-tired applications for our products. By leveraging our existing capacities e_ciently, nurturing strong relationships with key international and domestic customers, and embracing innovation, we are well positioned as a leading player in the global rubber chemicals space.

Closing Note: A Heartfelt Thank You!

I extend my heartfelt gratitude to each one of you for your support and trust in NOCIL. Your commitment has been instrumental in our journey towards growth, innovation, and sustainability. Together, we will navigate the challenges and seize the opportunities that lie ahead, ensuring a prosperous future for all. Thank you for being an integral part of our journey.