Cosmo First Ltd

DIRECTOR'S REPORT

Your directors are pleased to present their 47^th Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31^st March 2024.

1. SUMMARY FINANCIAL RESULTS

The Financial Results of the Company for the year ended 31^st March 2024, were as follows:

2. PERFORMANCE SNAPSHOT

During the FY24, on consolidated basis the Company registered sales of Rs.2,587 Crores vs Rs.3,065 Crores last year. Consolidated EBITDA for the year was Rs.251 Crores as against Rs.434 Crores in FY23 primarily due to margin pressure in BOPP

6 BOPET industry due to commissioning of several new production lines during last 18 months. However, the Company has outperformed the industry at large due to higher sales of speciality films.

On Standalone basis, the Company registered sales of Rs.2391 Crores vs Rs.2,742 Crores last year. Standalone EBITDA for the year changed to Rs.213 Crores against Rs.396 Crores in FY23 primarily for the reasons explained above.

As on 31^st March 2024, consolidated Net Debt/ EBITDA stands at 2.2 times and Net Debt/Equity at 0.4 times. The Company's financials remain strong.

The Global Flexible Packaging Market size in terms of production volume is expected to grow from 34.67 Million tonnes in 2024 to 40.94 Million tonnes by 2029, at a CAGR of 3.38% during the forecast period (2024-2029)¹. Asia-Pacific flexible packaging market share is anticipated to exhibit a CAGR of 5.02% during the period 2023-2031². The India Flexible packing market is projected to grow from $ 32847.54 Million in 2024 to $ 43656.77 Million by 2032 as a compound annual growth rate (CAGR) of 3.62%.³

The flexible packaging market is driven by a combination of factors, including increasing demand for convenient and lightweight packaging solutions, rising consumer awareness toward sustainability, and advancements in packaging technology for improved shelf life and product protection. As industries prioritize eco-friendly solutions and consumers seek convenience and functionality, the flexible packaging market is poised to expand. Asia-Pacific region is the most desirable market for manufacturers of flexible packaging due to its high domestic demand and plentiful, low-cost labour.

With increasing long term demand potential for flexible packaging, the Company has planned about 50% capacity addition in flexible packaging business in phases starting from FY25. While specialized BOPET line got commissioned during FY23, the CPP line and BOPP line are expected to get commissioned in FY25 and FY26 respectively. Both the lines will be the world's largest production capacity lines with lower cost of production.

The Company's focus shall continue to be on improving speciality films, R&D efforts particularly on sustainability which would yield results in coming years. These actions would continue to de-commoditize business model and would contribute in long term sustainable growth. The Company's speciality films sales stand at 64% during FY24. On BOPET line as well, the company is looking to kick off few specialty products which includes window films, security films, PET-G films, and many others.

METALLIZED FILM FOR CAPACITORS

The Company invested into a new category of film- Metallized Film for Capacitors with benefits under production linked incentive scheme. The commercial production started in Q3 FY24.

The Company plans to launch Sun Control Films/ Window Films under the brand Cosmo Sunshield during FY25. This is a unique and innovative sun control film introduced in the Indian market to address the ever rising heat wave problem, which has a significant impact on energy demand and public health. This film can protect 99% of ultra violet rays that can cause damage and fading to furniture and interior items. This film is designed to make glass shatter-resistant by holding the glass pieces together when broken. These films are built using special micro-layered polyester technology, which significantly increases tear resistance. The commercial production will start in FY25.

The Company is currently having five registered patents; nine in pipeline and another three are being applied.

SPECIALITY CHEMICALS

In Speciality Chemicals the Company has three verticals i.e. masterbatch, coating chemicals and adhesive. In each of these segment the Company plans to cater to niche speciality focused either to address current problem area for the Industry or significantly better product compared to currently available.

India Master Batch Market size was valued at $ 12.4 Billion in 2023 and the total India Master Batch Market revenue is expected to grow at a CACR of 4.8 % from 2024 to 2030, reaching nearly $ 17.22 Billion.⁴ The substitution of metal with plastics across end-use industries such as automotive and transportation, building and construction, consumer goods, and packaging is anticipated to be a crucial factor for the increasing global market size in the forecast period.

The Global Adhesives Market size is estimated at $ 68.88 Billion in 2024, and is expected to reach $ 87.04 Billion by 2028, growing at a CAGR of 6.03% during the forecast period (2024-2028).⁵ The India Adhesives Market size is estimated at $ 2.87 Billion in 2024, and is expected to reach $ 3.76 Billion by 2028, growing at a CAGR of 6.98% during the forecast period (2024-2028)⁶.

The global industrial coatings market is expected to be worth $ 129.2 Billion by 2028 growing at the CAGR of 3.3% between 2023 and 2028. Environmental regulations boost the demand for VOC-free coatings and are major factor behind the market growth.

The annual capacity of the Company for masterbatch is 10KMT, adhesives is 2.5KMT and Coating Chemicals is 5KMT. The Company targets to achieve 7%-8% of Company's consolidated revenue from speciality chemicals in 3-5 years with 25% ROCE.

COSMO PLASTECH

During the year, the Company invested into Rigid Packaging which includes Rigid sheets, Thermoforming and Injection Moulding. Cosmo Plastech is the end-to-end rigid packaging solution that specializes in creating customized packaging solutions for a variety of fast-moving consumer goods (FMCG) products.

Cosmo Plastech works closely with its clients to understand their specific packaging needs, and then designs and manufactures customized containers to meet those needs. Company's expertise in injection moulding and thermoforming techniques, as well as our BOPP-based film, makes it a trusted partner for many companies across the globe.

The phase one commercial production started in FY24 and phase two will start in FY25. The annual capacity of the Company for rigid packaging is 4.8KMT The Company also attained globally recognized FSSC 22000 food safety certification, a mandatory requirement for packaging material coming into direct contact with food. Earning this rigorous accreditation required demonstrating a systematic and meticulous approach to food packaging production.

PETCARE-ZICLY

The Global Pet Care Market size is estimated at $ 20.02 Billion in 2024, and is expected to reach $ 24.59 Billion by 2029, growing at a CAGR of 4.20% during the forecast period (2024-2029)⁷.lndia's Petcare market is currently around Rs. 5000 Cr and is expected to cross Rs. 12000 Crores by 2027.

The Company's Petcare division Zigly launched in September 2021 follows an Omni Channel approach. It offers complete Petcare solution. It has a team of seasoned veterinarians with diverse expertise in critical care services viz: surgeries, consultation, pathology, radiology, pharmacy and vaccination. It offers premium pet products and spa and grooming services for pets. With 23 experience centers operational as on FY24, the Company targets to have 50+ experience centres in next couple of years.

3. SUSTAINABILITY

The Company is working on several sustainability projects.

The Company targets to achieve carbon foot print reduction of 1.02 lacs MT equivalent C0₂ emission by FY25 and 1.40 lacs MT equivalent Co₂ emission by FY 26.

The roof top solar power plants have been installed for all manufacturing units. The Company is currently using around 15% of Renewable power. The Company targets to raise the use of Renewable power to more than 50% of its total power consumption by FY25 and further increase it to more than 60% of total power consumption by FY26.

The Company has taken several steps towards rain water harvesting. 17% of the water consumed is being harvested.

The Company has water treatment plants. 45% of the waste water is being reused.

Noise reduction measures were taken across our Waluj, Shendra, and Karjan plants operations by using various noise control technologies and strategic operational adjustments. Acoustic enclosures are provided at high noise area to reduce noise to 80-85 dB.

The Company has taken several steps to minimise the waste generation. It has dedicated recycling plant for MLP and Post Industrial waste.

Initiatives have been taken for installing Wet Scrubber for Thermopack Boilers to improve resource efficiency and reduce impact due to emissions, effluent discharge, waste generated. Wet scrubber is used to reduce the amount of air pollution. In wet scrubbing processes, solid particles are removed from a gas stream by transferring them to a liquid. The liquid most commonly used is water.

Several other sustainability initiatives are as under:

• Use of Water Based Coatings

• Offer a suitable substitute for aluminium foil in form of its Ultra-High Barrier Films.

• Offer Oxo-Biodegradable Films

• Offer mono layered structure for ease of recycling

• partnering with some of the best global brands to offer structure rationalization & recyclability solutions.

• Both BOPP and CPP films offer better yield, hence enabling reduced consumption of plastics.

• Invest in R&D and grow its speciality film portfolio offering sustainable solutions for a better tomorrow.

• Innovated heat resistant BOPP film to facilitate mono material structure.

• UV stabilized Synthetic Paper can be used to replace PVC in outdoor promotional applications for duration requirements up to one year.

• Focus on reducing Green House Gas missions, green energy at plants, waste reduction, water treatment etc.

• Constant monitoring of parameters like noise, illumination, ventilation, air quality etc.

• Rain water harvesting and reuse of effluent treated water.

• Reutilization of reprocessed granules from waste material as input for film production.

• Working on 3R principles i.e. Reducing waste, reusing and recycling resources and products.

• Continuous efforts to reduce water usage, waste generation and GHG emissions.

• Manufacturing environment friendly, sustainable polymers, which are easily recycled and reused in a variety of ways.

These steps will not only contribute to the environment but will also rationalize costs in coming quarters

4. EXPORTS

The Exports for the financial year are Rs. 1,047 Crores which is 44% of total sales. The Company exports to 80+ countries across the globe.

5. DETAILS OF SUBSIDIARIES

The Company has Nine subsidiaries including step down subsidiaries. Pursuant to Section 129(3) of the Companies Act, 2013 and Accounting Standards issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its Subsidiaries.

Consolidated Financial Statements form part of this Annual Report. Statement containing the salient features of the financial statement of the Company's subsidiaries in Form AOC-1, is enclosed to this Annual Report.

In terms of provisions of Section 136 of the Companies Act, 2013, the Company place separate audited accounts of the Subsidiary Companies on its website at https://www.cosmofirst.com/ disclosure-under-reaulation

The subsidiaries of Cosmo First Limited as on FY 24, are listed hereunder:

• CF (Netherlands) Holdings Limited B.V.

• Cosmo Films Japan, GK

• Cosmo Films Singapore Pte Limited

• Cosmo Films Korea Limited

• Cosmo Films Inc.

• CF Investment Holding Private (Thailand) Company Limited

• Cosmo Speciality Chemicals Private Limited

• Cosmo Speciality Polymers Private Limited

• Cosmo Global Films Private Limited

•During the year, the Company closed its wholly owned subsidiary company at Poland-Cosmo Films Poland SP. Z.O.O w.e.f. 13^th September 2023. This was a non material dormant subsidiary and was closed due to low business prospects. It had no financial impact on the Company.

Subsidiary's EBITDA stood same as last year at Rs. 38 Crores.

6. SHARE CAPITAL

During the year under review, there was no change in the Company's issued, subscribed and paid-up equity share capital. On 31^st March 2024, it stood at Rs. 26.25 Crores divided into 26249727 equity shares of Rs. 10/- each.

Net Worth and Book Value per share

7. RESERVE

The Special Economic Zone (SEZ) Re-investment reserve has been created out of the profit of eligible SEZ units in terms of the provisions of Sec 10AA(l)(ii) of Income Tax Act, 1961 and the amount of Rs. 42.70 Cr. has been transferred therein. The reserve will be utilised by the company for acquiring plant and machinery for the purpose of its business in the terms of the Sec 10AA(2) of the Income Tax Act, 1961.

8. RETURN TO SHAREHOLDERS

The Board of Directors of the Company recommended Equity dividend of Rs. 3/- (30%) per share for the year ended 31^st March 2024 amounting to Rs. 7.87 Crores.

Previous Year Company declared dividend of Rs. 5/- (50%) per Equity Share of Rs. 10/- each amounting to Rs. 13.12 Crores.

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") the Dividend Distribution Policy is available on the Company's website at https://www.cosmofirst.com/investors/policies- and-code-of-conduct

9. RESEARCH AND DEVELOPMENT (R&D)

• Mass Spectrometer

• Thermo Gravimetric Analysis

• Barrier Testing (OTR & MVTR)

• UV Spot Coating and Screen Printing

• Dynamic Mechanical Analyzer

• Scanning Electron Microscope

• Optical Microscope

• FTIR Microscope

• ANSI Barcode Scanner

• Dynamic Mechanical Analyzer

• Differential Scanning Calorimetry

The Company has been continuously investing and upgrading its research and development capabilities keeping customer needs in mind for providing industry first innovative and sustainable solutions.. The Company's R&D labs are equipped with state of the art equipment and instruments. The R&D team is actively driving several sustainability projects to ensure that the Company remains at the forefront for providing sustainable solutions.

In FY24, the Company has invested on a R&D food laboratory (Packsmart). This laboratory is equipped with state of the art equipment and instruments like Vertical Form Fill Seal (VFFS) machine, Vacuum leak tester, Stability chamber food shelf life analysis in new sustainable structure. This is the first of its kind initiative by a film manufacturer globally which will help local and global brands for faster introduction of products in the market. With this capability Cosmo can develop innovative sustainable laminate structures and study shelf life of food packed in new laminate structure by simulating real life conditions thereby reducing the product development costs and time for local and global brands.

Cosmo First's dedicated R&D team plays a crucial role in keeping it ahead of the curve when it comes to product innovation. Comprising of more than 30 scientists and technologists from esteemed universities located worldwide, the team has a wealth of global experience in areas such as packaging, polymer engineering, biopolymers and renewable energy material. The Company will keep strengthening its R&D team and infrastructure to stay ahead of the curve by focusing on the sustainable product development.

The Company launched several new products during the financial year in various categories of Packaging, lamination, labelling & synthetic paper applications. Some of the notable product developments are Cold Seal release matte BOPP films, High puncture resistance BOPP, CPP films for nitrogen flushing, CPP film for high retort packaging, various grades of PET-C Shrink label films, Cold metalized, Digital and photo album laminations films, FDA approved coated CSP-Flexi, UV Inkjet printable PSA label film, High barrier coated film for hot melt adhesives, PVC free film for wide format graphics applications, metalized films for capacitors used in electronics application.

ANALYTICAL FACILITY

The Company has outstanding track record of continuous investment in R&D infrastructure by keep adding new instruments and hiring of strong and skilled analytical team. Our state of art analytical lab has equipment's like FTIR microscope, CC & CC Ms with headspace & TCA hyphenation, particle size analyser, UV-Vis spectrophotometer, scanning electron microscope (with EDX) IV measurement system etc. The team has developed new analytical methods to solve customer issues fast and develop new product with fundamental understanding. Our state of art analytical lab can be extensively utilized for all kind of analysis of film substrates, coatings, resins, adhesives and master batches. The lab is capable of surface, structural and elemental analysis from nano to macro level.

The application labs of the Company can analyse all critical customer requirements in films, packaging adhesives, compounds, additives and coating segment. New instruments to perform weatherability testing have recently been added. Cosmo also have pilot synthesis, coating and extrusion facilities that help to launch our products faster in the market.

During the year under review, your Company incurred the expenditure on Research & Development of Rs. 9.00 Cr.

10. CAPITAL EXPENDITURE

Your Company has three state of the art manufacturing facilities spread in India with a total installed capacity of -

• 1,96,000 MT per annum of BOPP films (9 lines),

• 40,000 MT per annum of Thermal Lamination Films (8 lines),

• 22,000 MT per annum of Metalized Films

(4 lines),

• 20,000 MT per annum of Coated Films (6 lines),

• 10, 000 MT per annum of CPP Films (2 lines),

• 7,000 MT per annum of CSP Line (1 line),

• 30,000 MT per annum of BOPET Line (1 line),

In Cosmo Speciality Chemicals, Company has installed capacity of 10,000 MT per annum of Masterbatches, 2,500 MT per annum of adhesives and 5,000 MT per annum of Coating Chemicals.

The installed capacity of Rigid Packaging is 10,000 MT per annum.

During the year under review, your Company incurred capital expenditure of Rs. 297.51 Crores as compared to Rs. 380.40 Crores for FY24.

The capital expenditure incurred during FY24 shall facilitate enhanced sale of speciality films & rigid packaging sustainability initiatives and solar power as a source of energy.

11. CORPORATE GOVERNANCE

Cosmo is committed to maintaining best standards of Corporate Governance and has always tried to build the maximum trust with shareholders, employees, customers, suppliers and other stakeholders.

A separate section on Corporate Governance forming part of the Directors' Report and the certificate from the Practicing Company Secretary confirming compliance of the Corporate Governance norms as stipulated in the Listing Regulations is included in the Annual Report in Annexure - A.

12. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, safeguarding of its assets, prevention and detection of fraud, error reporting mechanisms, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures.

The Internal Financial control is supplemented by an extensive program of internal audit conducted by in house trained personnel and external firm of Chartered Accountants appointed on recommendation of the Audit Committee and the Board. The audit observations and correctiveaction, if any, taken thereon are periodically reviewed by the Audit committee to ensure effectiveness of the Internal Financial Control System. The internal financial control is designed to ensure that the financial and other records are reliable for preparing financial statements and other data, and for maintaining accountability of persons.

13. RISK MANAGEMENT

Cosmo has a robust process in place to identify key risks across the organisation and prioritise relevant action plans to mitigate these risks. The Company has constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) approving the Company's Risk Management Framework and (b) Overseeing all the risks that the organization faces such as strategic, financial, liquidity, security, regulatory, legal, reputational and other risks that have been identified and assessed to ensure that there is a sound Risk Management Policy in place to address such concerns / risks. The Risk Management process covers risk identification, assessment, analysis and mitigation. Incorporating sustainability in the process also helps to align potential exposures with the risk appetite and highlight risks associated with chosen strategies.

The risk management procedure is reviewed by the Audit Committee and Board of Directors on regular basis at the time of review of quarterly financial results of the Company. The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis.

A report on the various risks that may pose challenge to your Company are set out as a part of Management, Discussion and Analysis section of this report. Details of the composition of the Risk Management Committee, Meetings held, attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

14. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism for the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy without fear of reprisal. The policy is accessible on the Company's website at https!//www.cosmofirst. com/investors/policies-and-code-of-conduct

15. DIVERSITY OF THE BOARD

The Company believes that diversity is important to the work culture at any organisation. In particular, a diverse Board, among others, will enhance the quality of decisions by utilizing different skills, qualifications and professional experience for achieving sustainable and balanced development.

(A) CHAIRMAN

Mr. Ashok Jaipuria, is the Chairman & Managing Director of the Company.

(B) APPOINTMENT AND RE-APPOINTMENT- EXECUTIVE DIRECTORS

Mr. Anil Kumar Jain, Whole time Director is liable to retire by rotation and being eligible offers himself for re-appointment at the ensuing Annual General Meeting.

The tenure of Mr. Anil Kumar Jain, Whole Time of the Company is expiring on 30^th September 2024. The Board of Directors in its meeting held on 15^th May 2024, on the recommendation of the HR, Nomination & Remuneration Committee and subject to the approval of Members of the Company reappointed him for a further period of five years w.e.f. 01^st October 2024.

The details of the proposed appointment/ reappointment of Directors are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of 47^th Annual General Meeting (ACM) of your Company.

(C) STATUS OF OTHER DIRECTORS

Mr. Pratip Chaudhuri is acting as Non Independent Non Executive Director, liable to retire by rotation.

Mr. Har Kishanlal Agrawal, is acting as Independent Director of the Company. His tenure is expiring on 24^th July 2024.

Mr. Hoshang Noshirwan Sinor, is acting as Independent Director of the Company. His present tenure of five years is from 22^nd May 2020 to 21^st May 2025.

Mr. Rakesh Nangia, is acting as Independent Director of the Company. His present tenure of five years is from 10^th November 2020 to 09^th November 2025.

Mr. Arjun Singh, is acting as Independent Director of the Company. His present tenure of five years is from 27^th October 2021 to 26^th October 2026.

Ms. Alpana Parida is acting as Independent Director of the Company. Her present tenure of 5 years is from 15^th May 2024 till 14^th May 2029.

Mr. Anil Wadhwa is acting as Independent Director of the company. His present tenure of 5 years is from 23^th May 2023 till 22^th May 2028.

Mr. Yash Pal Syngal is acting as Independent Director of the company. His present tenure of 5 years is from 08^th November 2023 till 07^th November 2028.

(D) INDEPENDENT DIRECTORS DECLARATION

The Company has received necessary declaration from each Independent Director under section 149(7) of the Companies Act, 2013 that they meet the criteria of independence laid down in section 149(6) of the Companies Act, 2013 and Regulation 16 of Listing Regulations.

17. STATEMENT OF BOARD OF DIRECTORS

The Board of Directors of the Company are of the opinion that the Independent Directors of the Company appointed/re-appointed during the year possesses integrity, relevant expertise and experience (including the proficiency) required to best serve the interest of the Company. The Independent Directors have confirmed compliance of relevant provisions of Rule 6 of the Companies (Appointments and Qualifications of Directors) Rules, 2014.

18. KEY MANAGERIAL PERSONNEL

During the year under review, there was no change in KMP of the Company. The following personnel's continue as KMPs as per the definition under Section 2(51) and Section 203 of the Companies Act, 2013:

1. Mr. Ashok Jaipuria, Chairman & Managing Director

2. Mr. Anil Kumar Jain, Director - Corporate Affairs

3. Mr. Pankaj Poddar, Chief Executive Officer

4. Mr. Neeraj Jain, Chief Financial Officer

5. Ms. Jyoti Dixit, Company Secretary

19. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

The Company follows a well-structured induction programme for orientation and training of Directors at the time of their joining so as to provide them with an opportunity to familiarise themselves with the Company, its management, its operations and the industry in which the Company operates.

At the time of appointing a Director, a formal letter of appointment is given to him/her, which inter alia explains the role, function, duties and responsibilities expected of him/her as a Director of the Company. The Director is also explained in detail the Compliance required from him/ her under the Companies Act, 2013, the Listing Regulations and other relevant regulations and affirmation taken with respect to the same.

The induction programme includes:

1) For each Director,a one to one discussion with the Chairman and Managing Director to familiarise the former with the Company's operations.

2) An opportunity to interact with the CEO, CFO & Company Secretary, business heads and other senior officials of the Company, who also make presentations to the Board members on a periodical basis, briefing them on the operations of the Company, strategy, risks, new initiatives, etc.

The details of the familiarisation programme may be accessed on the Company's corporate website at https://www.cosmofirst.com/disclosure-under- regulation

20. REMUNERATION POLICY

Your Company is driven by the need to foster a culture of leadership with mutual trust. Cosmo's remuneration policy, which is aligned to this philosophy, is designed to attract, motivate, retain manpower and improve productivity by creating a congenial work environment, encouraging initiative, personal growth and teamwork besides offering appropriate remuneration package. Pursuant to the applicable provisions of the Companies Act, 2013 and the Listing Regulations, the Board, in consultation with its HR, Nomination & Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

Members can download the complete remuneration policy on the Company's website at https://www.cosmofirst.com/investors/policies- and-code-of-conduct

Disclosure of details of payment of remuneration to Managerial Personnel under Schedule V(C)(6) of Listing Regulations forms part of the Corporate Governance Report.

21. PERFORMANCE EVALUATION OF THE BOARD, COMMITTEES AND INDIVIDUAL DIRECTORS

In terms of provisions of Companies Act, 2013 read with the Rules issued thereunder and Listing Regulations, the Board has adopted a formal mechanism for evaluating the performance of its Board, Committees and individual Directors, including the Chairman of the Board. Further, a structured performance evaluation exercise was carried out based on criteria such as:

• Board/Committees composition;

• Structure and responsibilities thereof;

• Ethics and Compliance;

• Effectiveness of Board processes;

• Participation and contribution by members;

• Information and functioning;

• Specific Competency and Professional Experience /Expertise;

• Business Commitment & Organisational Leadership;

• Board/Committee culture and dynamics; and

• Degree of fulfilment of key responsibilities, etc.

The performance of Board, Committees thereof, Chairman, Executive and Non-Executive Directors and individual Directors is evaluated by the Board/ Separate meeting of Independent Directors. The results of such evaluation are presented to the Board of Directors.

22. BOARD AND COMMITTEE MEETINGS

Diversity of Board/Committee's

During FY23, Five(5) meetings of the Board of Directors and Four (4) Audit Committee meetings were held. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and Listing Regulations.

Details of the composition of the Board and its Committees and of the Meetings held, attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

There have been no instances of non-acceptance of any recommendations of the Audit Committee by the Board during the Financial Year under review.

(A) STATUTORY AUDITORS

M/s.S.N. Dhawan & Co. LLP, Chartered Accountants (ICAI Firm Registration No. 000050N/N500045) were appointed as the statutory auditors of the Company in the 43^rd Annual General Meeting held on 07^th August 2020, to hold office for a period of five consecutive years from the conclusion of the 43^rd Annual General till the conclusion of the 48^th Annual General Meeting to be held in the

year 2025. The Statutory Auditors have confirmed they are not disqualified from continuing as Auditors of the Company.

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report that may call for any explanation from the Directors. Further, the notes to accounts referred to in the Auditor ‘ s Report are self-explanatory.

During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

(B) COST AUDITORS

Mr. Jayant B. Galande, Cost Accountants were appointed as Cost Auditors of the Company for the Financial Year 2024. In accordance with the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, since the remuneration payable to the Cost Auditors is required to be ratified by the shareholders, the Board recommends the same for approval by shareholders at the ensuing ACM.

In terms of the Section 148 of the Companies Act, 2013 ( the Act ) read with Rule 8 of the Companies (Accounts) Rules, 2014, it is stated that the cost accounts and records are made and maintained by the Company as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

(C) SECRETARIAL AUDITORS

The Company had appointed M/s. BLAK & Co., Company Secretaries, New Delhi, to conduct its Secretarial Audit for the FY2023-24. The Secretarial Audit report is annexed herewith as Annexure - B to this report. There are no qualifications, reservations or adverse remarks made by Secretarial Auditor in his report. During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

24. RELATED PARTY TRANSACTION

With reference to Section 134(3) (h) of the Companies Act, 2013, all contracts and arrangements with related parties under Section 188(1) of the Companies Act, 2013, entered into by the Company during the Financial Year, were in the ordinary course of business and on an arm's length basis. The details of the related party transactions as required under Indian Accounting Standard are set out in Note 44 to the standalone financial statements forming part of this Annual Report.

As per the Listing Regulations, all related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee has been obtained for the transactions which are of unforeseen and repetitive nature. The transactions entered into pursuant to the omnibus approval are presented to the Audit Committee by way of a statement giving details of all related party transactions. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions and can be accessed on the Company's website at https://www.cosmofirst. com/investors/policies-and-code-of-conduct.

No Material Related Party Transactions (i.e. one thousand crore or ten per cent of the annual consolidated turnover of the listed entity as per the last audited financial statements, whichever is lower) were entered during the year by your Company. The disclosure of Related Party Transactions as required under section 134(3)(h) of the Companies Act, 2013, in Form AOC - 2 is attached as Annexure - C.

25. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Pursuantto regulations34 of the Listing Regulations, Management's Discussion and Analysis Report for the year is presented in a separate section forming part of the Annual Report.

26. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

Pursuantto regulations34 of the Listing Regulations, Business Responsibility and Sustainability Report for the year is presented in a separate section forming part of the Annual Report.

27. DEPOSITS

The Company has not accepted deposit from the public within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

28. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the

Companies Act, 2013, read with the Rule 8 of Companies (Accounts of Companies) Rules, 2014 is annexed herewith as Annexure - D to this report.

29. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company have duly complied with the provision of Section 186 of the Companies Act, 2013 during the year under review. The details of loans, guarantees and investments are covered in the notes to the Financial Statements.

30. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, no significant / material orders were passed by the regulators or the Courts or the Tribunals impacting the going concern status and the Company's operations in future.

31. CHANGE IN NATURE OF BUSINESS, IF ANY

There was no change in the nature of business during the year under review.

32. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING FINANCIAL POSITION OF THE COMPANY

There were no other material changes / commitments affecting the financial position of the Company or that may require disclosure, between 31^st March 2024 and the date of Board's Report.

33. LISTING WITH STOCK EXCHANGES

The Company confirms that it has paid the Annual Listing Fees for the year FY24 to the NSE and the BSE where the Company's equity shares are listed.

34. ANNUAL RETURN

Pursuant to the provisions of section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company is available on the website of the Company at the link: https://www. cosmofirst.com/investors/notifications-notices.

35. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Details of Unclaimed Dividend and Shares transferred to IEPF during Financial Year 2023-24 are given in Corporate Governance Report.

36. CORPORATE SOCIAL RESPONSIBILITY

Some of the Flagship Programs (Education to 13,000+ Students).

Computer Operation & Digital Skill Building Program

Covers 8,000+ students with 25 Computer Labs

Basic English Learning Program

Implementation in 16 rural schools with 6000+ students

Cosmo Cyan Vihar Kendra

Identifies enrolls and grades 4,000+ students from class 1 to VII every year to strengthen their reading & writing skills

As a socially responsible Company, Cosmo is committed to increasing its Corporate Social Responsibility (CSR) impact with an aim of playing a bigger role in sustainable development of our society. In pursuit of this objective, a Corporate Social Responsibility (CSR) Committee had been formed by the Company which oversees and facilitates deliberation on the social and environmental consequences of each of the decisions made by the Board.

The Company has in place a Corporate Social Responsibility Policy pursuant to the provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

The initiatives undertaken by your Company during the year have been detailed in CSR Section of this Annual Report. The Annual Report on CSR activities in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014, is set out herewith as Annexure - E to this Report.

37. PROMOTION OF WOMEN'S WELL BEING AT WORK PLACE

Cosmo First has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the said act. The details related to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 forms a part of Corporate Governance Report.

38. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointmentand Remuneration of Managerial Personnel) Rules, 2014 is also enclosed as Annexure - F to this Report.

The information pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 pertaining to the top ten employees in terms of remuneration drawn and their other particulars also form part of this report. However, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Companies Act, 2013, the said annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

39. EMPLOYEE STOCK OPTIONS

The Company has an Employee Stock Option Plan for the Employees of the Company and its Subsidiaries named as Cosmo Films Shares Based Employee Benefit Scheme, 2021 ("CF SBEB Scheme"). The Plan is in compliance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and is administered by the HR, Nomination and Remuneration Committee of the Board constituted by the Company pursuant to the provision of Section 178 of the Companies Act, 2013 and Listing Regulations.

The details of the CF SBEB Scheme form part of the Notes to accounts of the Financial Statements in this Annual Report and also available on our website at www.cosmofirst.com.

40. INSOLVENCY & BANKRUPTCY CODE/ SETTLEMENT

No proceedings are made or pending under the Insolvency and Bankruptcy Code, 2016 and there is no instance of one-time settlement with any Bank or Financial Institution.

41. DIRECTOR'S RESPONSIBILITY STATEMENT

Pursuant to the section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of knowledge and belief and according to the information and explanations obtained by them, hereby confirm that:

I. In preparation of the annual accounts, applicable accounting standards have been followed along with proper explanation relating to material departures.

II. Accounting policies selected were applied consistently. Reasonable and prudent judgments and estimates are made so as to give a true and fair view of the state of affairs of the Company as of 31^st March 2024 and of the profits of the Company for the year ended on that date.

III. 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.

IV. The annual accounts of the Company have been prepared on a going concern basis.

V. Proper Internal Financial Controls were in place and that the Financial Controls were adequate and were operating effectively.

VI. Systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

42. AWARDS & ACCOLADES

During the Year, Company has bagged:

• Cosmo Films bags SIES SOP Star Award for Packaging Materials & Components across 4 entries

• the prestigious Forbes Asia Best Under a Billion Companies Awards 2023

• the IFCA Star Awards 2023 in the innovative category

• the "Most Enterprising Business Award" from the prestigious Entrepreneur Magazine

• Zigly bagged the top 100 D2C retail businesses of the year by the Retailer Magazine

• ET Leadership Excellence Award to Mr. Pankaj Poddar for Excellence in the Manufacturing of Films and Chemicals

• the Top 10 Companies from India in the Forbes Asia Best Under A Billion 2022 list

• Ranked as one of India's Fastest Crowing Companies by BW Business World Magazine

43. SECRETARIAL STANDARDS

During the FY24, the Company has complied with applicable Secretarial Standards issued by the Institute of the Company Secretaries of India.

44. ACKNOWLEDGEMENT

Your Directors would also like to extend their gratitude for the co-operation received from financial institutions, the Government of India and regulatory authorities, and the governments of the countries we have operations in. The board places on record its appreciation for the continued support received from customers, vendors, retailers and business partners, which is indispensable in the smooth functioning of Cosmo. Your Directors also take this opportunity to thank all investors and shareholders, and the stock exchanges for their continued support. Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. Their contribution to the success of this organization is immensely valuable.