Lux Industries Ltd

Dear shareholders,

Your Directors are pleased to present the 29th Annual Report concerning the Company's business and activities. Additionally, the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2024 are also being presented.

1. Financial Highlights C ( in Crores)

2. Operating & Financial Performance

The Company's revenue stagnation around the level of previous year was creditable considering textile sector slowdown. The Company maintained a sustain performance and reported at standalone level a total revenue of _2,324.05 Crores for FY 2023-24, as compared to _2,371.11 Crores in the previous year. EBITDA remained at _219.67 Crores in FY 2023-24, reflecting persistent operational efficiency, compared to _236.29 Crores in the prior period. The Company achieved a stabilized PAT of _133.57 Crores in FY 2023-24. Notably, e_icient management of inventory, debtors and vendors resulted in substantial reduction in working capital days from 176 to 161, underscoring enhanced operational effectiveness. Recognized as the No.1 Indian innerwear company in terms of volume, the Company has achieved significant milestones and impressive growth across its various brands. The menswear brands GenX, Lux Venus and Lux Cozi experienced a remarkable year-on-year volume growth of ~48%, ~15% and ~5% respectively. Meanwhile, the womenswear brand ‘Lyra' delivered consistent volume growth of around ~11% year-on-year. Lux Karishma and Lux Classic, also saw an impressive volume growth of around 30% and 12% year-on-year respectively.

Due to a decline in the average selling price, driven by falling raw material prices, particularly in yarn, the Company has passed on the benefits to its customers, enhancing its value proposition. These raw material prices have now stabilized, ensuring consistent cost advantages for consumers in coming quarters. During the year under review, the Company onboarded Surya Kumar Yadav and Urvashi Rautela as the brand ambassadors for ‘GenX.' Lux has diversified from its origins as a men's innerwear brand to include women's wear, kids' wear, athleisure, and winter wear. Currently, the innerwear segment accounts for approximately 70+% of the Company's revenue. Recently, the Company has made its maiden entry in the rainwear market under the ‘Lux Venus' brand with the tagline "Bheegna Mana Hai!". This strategic move aims to make Lux, relevant across all seasons, diversify the Company's product offerings and explore new market opportunities. Furthermore, the Company has launched its women's wear economy segment through the introduction of ‘Lux Venus Her,' catering to the growing demand in this sector. A significant growth driver for the Company is the women's segment, benefiting from factors like more women entering the workforce, rising disposable incomes, and greater brand awareness.

Lux Cozi, the renowned brand has launched its new range of premium products, "Lux Cozi Boyz" curated for the kids of 3 to 14 years of age. It has made a wide-spread presence in the market with its excellent quality outerwear and innerwear products made of 100% cotton. The outerwear products include t-shirt, half pant & track pant & the innerwear product range includes white & colour vests, plain & printed briefs & boxers designed especially for the kids that renders ultimate comfort & coziness.

During the financial year 2023-24, the Company completed its project of setting up a manufacturing and warehousing facility and commenced commercial operations on January 31, 2024 at Jagadishpur, West Bengal Hosiery Park. The 4.50 Lakh square feet ‘State-of-the-Art' facility is spread over 5 acres of land of which 20-30% shall be used for manufacturing and balance for warehousing, storage, and finishing facilities. This facility is expected to cater to the rising demand of the Company's products, and in line with the Company's commitment towards fostering sustainable growth. The Facility is strategically designed to optimize workflow, reducing the need for vertical movement between different stages of manufacturing process and dependency on third party production.

All factories operated efficiently throughout the year, with adequate safety measures and processes consistently adhered to and continuously improved across all sites. During the year under review, there has been no change in the nature of the business.

3. Performance of Subsidiary Company Artimas Fashions Private Limited

During the year under review, Artimas Fashions Private Limited has reported _17.40 Crores as Revenue from operations. The Total Income for the current financial year was _21.81 Crores as compared to _24.91 Crores in the previous financial year.

4. Dividend

Over the years, Lux has consistently followed a policy of paying dividend, keeping in mind the cash-generating capacities, the expected capital needs of business and strategic considerations. The Company recommended/ declared dividend as under:

In terms of the provisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'), the Board of Directors of the Company has adopted a Dividend Distribution Policy which is annexed as "Annexure- A" to this report and the updated Dividend Distribution Policy is available on the website of the Company i.e https://s3.amazonaws.com/luxs/ckeditors/pictures/535/ original/Lux__Dividend_Distribution_Policy.pdf

5. Capex and Liquidity

During the financial year 2023-24, the Company incurred _ 55 Crores on account of capital expenditure out of its internal accrual for acquiring Fixed Assets employed in the operations, enhancing production and storage capacity at Hosiery Park project in West Bengal. Your Company has sufficient cash to meet its operations and strategic objectives. The borrowings have decreased from _206 Crores as on March 31, 2023 to _150 Crores as on March 31, 2024. The balance funds have been invested in deposits with banks, highly rated financial institutions and debt schemes of mutual funds, leading to increase in treasury by ~_127 Crores.

6. Material Changes and Commitments

No material changes and commitments have occurred from the date of the close of the financial year, to which the financial statements relates, till the date of this Report, which affects the financial position of the Company.

7. Significant & Material Orders

No significant and material order has been passed by any Regulators or Courts or Tribunals impacting the going concern status and the Company's operations in future during the financial year under review.

8. Consolidated Financial Statements

The Consolidated Financial Statements of the Company are prepared in accordance with the relevant Indian Accounting Standards issued by the Institute of Chartered Accountants of India and forms an integral part of this report.

Pursuant to section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of Subsidiary is given in Form AOC-1 and annexed as Annexure- "L".

9. Share Capital

The paid-up share capital of the Company stood at _6,26,35,362 as at March 31, 2024 comprising of 3,00,71,681 equity shares of _2/- each (plus forfeited share capital amounting _24,92,000).

During the year under review, there was no change in the Share Capital of the Company.

The Company has not transferred any amount to the General Reserve during the financial year under review.

During the financial year, 2023-2024 the Company has transferred unpaid/unclaimed dividend, amounting to _73,507 (which includes interim dividend and final dividend declared for the financial year 2015-16) to the Investor Education and Protection Fund (IEPF) of the Central Government of India. The details of the shares transferred, if any, to IEPF account is available on the Company's Website- https:// s3.amazonaws.com/luxs/ckeditors/pictures/445/original/ List_of_Shareholders_whose_shares_were_transfered_to_ IEPF_in_the_F.Y_2023-2024.pdf The dividend which was declared for the year ended March 31, 2017 at the Annual General Meeting held on September 21, 2017, which remains unclaimed, will be transferred to the IEPF by October, 2024 pursuant to the provisions of the section 124 and 125 of the Companies Act, 2013. Thereafter, no claim shall lie on the Company for these unclaimed dividends. Shareholders will have to make their claim with the IEPF Authority following the appropriate rules in this regard. Further, the equity shares corresponding to the dividend which remained unclaimed for seven consecutive years, will be also transferred to the Demat account of the IEPF Authority. Individual notices and necessary newspaper publication will be made in this regard.

In compliance with Section 124 of the Companies Act, 2013 read with rule 6 of the Investor Education and Protection Fund (Accounting Audit, Transfer and Refund) Rules, 2017, 1020 Equity shares in respect of 5 folios which remained unclaimed for seven consecutive years were transferred to the IEPF Authority during FY 2023-24. Individual notices to concerned shareholder(s) were served and advertisement in newspapers were published by the Company in this regard.

Members are requested to claim the dividend(s), which have remained unclaimed/unpaid, by sending a written request to the Company at investors@luxinnerwear.com or to the Company's Registrar and Transfer Agent, KFin Technologies Limited ateinward.ris@kfintech.com or at their address at KFin Technologies Limited, Unit: Lux Industries Limited, Selenium Tower B, Plot 31-32, Financial District, Nanakramguda,

Serilingampally Mandal, Hyderabad 500032. Members can find the details of the Nodal officer appointed by the Company under the provisions of IEPF at https://www.luxinnerwear. com/investor-contacts. List of shareholders whose dividend remained unclaimed till date of ensuing AGM will be uploaded on the website of the Company https://www.luxinnerwear.com/ under heading ‘Investors' Section.

Your Company has not accepted deposits from the public, hence, there is no opening balances of Deposits. Further, your Company has also not accepted any Deposits during the financial year 2023-24 and no principal or interest were outstanding as on March 31, 2024 as per the provisions of the Companies Act, 2013 and the Rules made thereunder.

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security provided is proposed to be utilized by the recipient are provided in the Standalone Financial Statement. (Refer Note 37 to the Standalone Financial Statement).

The Corporate Guarantee given by the Company in favour of bank to secure the credit facility of its subsidiary, Artimas Fashions Private Limited was discharged with effect from August 07, 2023.

Your Company has established guidelines and procedures that facilitate adequate internal financial control system (including internal financial control system) throughout the Company. The details in respect of adequacy of internal financial controls with reference to the Financial Statements are stated in Management Discussion and Analysis, which forms part of this Report.

Pursuant to section 135 of the Companies Act 2013, read with rules made there under, the Company has constituted a Corporate Social Responsibility (CSR) Committee (the "CSR Committee") for monitoring and overseeing the CSR initiatives. The composition of the Committee is given in the Corporate Governance Report forming part of the Annual Report. Lux undertakes CSR initiatives both directly and as well as through Lux Foundation.

This year, Company's CSR initiatives were based primarily towards: -

• Healthcare

• Promotion of Education to underprivileged and tribal children including Children with special needs.

• Promotion of Sports

• Social Welfare of Socially and economically backward group

• Animal Welfare

• Ensuring Environmental Sustainability

• Promotion of Art and Culture

During the year under review, the Company has spent an amount of _6.43 Crores towards the CSR obligation. An amount of _0.45 Crores were transferred to Unspent CSR A/c for the FY 2023-24. The CSR Policy may be accessed on the Company's website at the link: http://s3.amazonaws.com/luxs/ckeditors/ pictures/95/original/CSR_Policy.pdf The Annual Report on CSR activities is annexed herewith as Annexure ‘B' forming part of this Report.

Pursuant to Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis Report for the year 2023-24 is annexed as Annexure ‘C' forming part of this Report.

The Company is committed to uphold good Corporate Governance practices. Pursuant to Regulation 34(3) read with Part C of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance together with a certificate from the Secretarial Auditor of the Company confirming compliance is set out in Annexure ‘D' and Annexure ‘F' respectively forming part of this report.

As required under Part B of Schedule II read with Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the certification on the accounts of the Company by Mr. Pradip Kumar Todi, Managing Director and Mr. Ajay Nagar, Chief Financial Officer is provided in the Annexure ‘E' of this Annual report. Further, a declaration on the Code of Conduct is included in this annexure.

As of March 31, 2024, the Board comprised of twelve directors, six of whom were independent directors, including two independent woman directors. The Chairman of the Board and the Managing Director were held by different individuals, both being Executive Directors. The details of the composition of the Board of Directors has been provided in the Corporate Governance Report forming part of this Annual Report. The profile of all director as on date are available on the Company's website at https://www. luxinnerwear.com/management/board-of-directors.

During the year under review, the Members approved the following re-appointment of Directors: a. Mr. Rahul Kumar Todi (DIN: 00054279) and Mr. Saket Todi (DIN: 02821380), who retired by rotation in terms of Section 152(6) of the Companies Act, 2013 and were reappointed as a director. b. Mrs. Rusha Mitra (DIN: 08402204) was re-appointed as an Independent Director of the Company for the second term of five years effective from March 29, 2024.

Further, the second and final term of appointment of Mr. Nandanandan Mishra (DIN: 00031342), Mr. Kamal Kishore Agarwal (DIN: 01433255), and Mr. Snehasish Ganguly (DIN: 01739432) as Non- executive Independent Directors of the Company expired at the close of business hours on March 31, 2024 and they ceased to be Directors of the Company. The Board of Directors and the Management of the Company expressed their deep sense of appreciation and gratitude for their extensive contribution and stewardship.

The Board of Directors of the Company in its meeting held on March 30, 2024, and based on the recommendation of the Nomination and Remuneration Committee, approved the appointment of Mr. Kumud Chandra Paricha Patnaik (DIN: 09696281), Mr. Sadhu Ram Bansal (DIN: 06471984) and Mrs. Shashi Sharma (DIN: 02904948) as Additional Directors in the category of Non-Executive - Independent Director of the Company for a term of 3 (three) consecutive years each, with effect from April 01, 2024. Pursuant to the Regulation 17(1)(C), the Company has sought the consent of the members through postal ballot process the details of which are available on the website of the Company. Apart from the above, there were no other changes in the Board members during the period under review.

As required under Regulation 34(3) and Schedule V Para C clause (10)(i) of the Listing Regulations the Certificate on Non-disqualification of Directors by M/s MR & Associates, Practicing Company Secretary confirmed that none of the director on the Board of the Company has been debarred or disqualified from being appointed or continuing as director of companies by the SEBI / Ministry of Corporate Affairs or any such statutory authority is annexed as Annexure ‘G' to the Board's Report.

• As on March 31, 2024, the Key Managerial Personnel (KMP) of the Company in compliance with the provision of section 203 of the Companies Act, 2013 are as under: -

• The details of the Senior Managerial Personnel (SMPs) of the Company as on March 31, 2024, are provided in the Corporate Governance Report forming part of this report. a. Retirement by Rotation

Mr. Ashok Kumar Todi (DIN: 00053599), Chairman & Whole-time Director and Mr. Udit Todi (DIN: 02017579), Executive Director of the Company, are liable to retire by rotation and, being eligible, offer themselves for reappointment in accordance to section 152(6) of the Companies Act, 2013, at the ensuing Annual General Meeting of the Company. b. Reappointment of Managing Director on completion of tenure

The present tenure of appointment of Mr. Pradip Kumar Todi (DIN: 00246268) as Managing Director of the Company will end on September 27, 2024, and a resolution seeking approval of the members of the Company for his re-appointment will be placed at the ensuing Annual General Meeting of the Company. c. Declarations from Independent Directors

Pursuant to the provisions of Section 149 of the Act, the Independent Directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as independent directors of the Company.

The details of the training and familiarization program are provided in the Corporate governance report. Further, at the time of the appointment of an independent director, the Company issues a formal letter of appointment outlining his / her role, function, duties and responsibilities. The format of the letter of appointment is available on our website, https://luxs.s3.amazonaws.com/uploadpdf/ upload+pdf/Cgovernance/id_02.pdf. The Directors are also explained in detail, the various declarations/ affirmations required from him/her as an Independent Director under various provision of Companies Act, 2013, and such other rules and regulations. e. Board Evaluation

Pursuant to the provisions of section 178 of Companies Act, 2013 and Regulation 17 and 19 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, the Board has evaluated its own performance, the performance of individual directors and its Committees. The manner of the evaluation has been explained in Nomination & Remuneration Policy in the Corporate Governance Report.

The Board of Directors conducted its annual evaluation of its own performance, the performance of its committees, and individual directors, in accordance with the provisions of the Act and SEBI Listing Regulations.

The Board's performance was assessed based on inputs from all directors, considering criteria such as board composition and structure, the effectiveness of board processes, information flow, and overall functioning.

Similarly, the performance of the committees was evaluated by the Board, with input from committee members, using criteria like committee composition and the effectiveness of committee meetings.

These criteria were broadly based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017. Additionally, in a separate meeting of Independent Directors held on January 31, 2024, the performance of Non-Independent Directors, the Board as a whole, and the Chairman of the Company was assessed, taking into account the views of executive and non-executive directors.

The Board and the Nomination and Remuneration

Committee reviewed individual directors' performance based on criteria such as their contributions to board and committee meetings, preparedness on issues discussed, and the meaningful and constructive inputs provided during meetings.

Following the meetings of the independent directors and the Nomination and Remuneration Committee, the Board discussed the performance evaluations of the Board, its Committees, and individual directors. The evaluation of independent directors was conducted by the entire Board, excluding the independent director being evaluated. f. Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The salient features of the Nomination and Remuneration Policy is stated in the Corporate Governance Report and has also been posted on the Company's website: https://s3.amazonaws.com/luxs/ ckeditors/pictures/484/original/Nomination_and_ Remuneration_Policy.pdf g. Meetings

During the year under review, six Board Meetings were convened and held. The details of meetings of the Board is provided in the Corporate Governance Report, which is a part of this report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and such other rules and regulations. h. Committees

The following are the details of the Committees as on March 31, 2024:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholder's Relationship Committee

• Risk Management Committee

• Corporate Social Responsibility Committee

• Committee of Directors

• Share Transfer Committee

• Internal Complaints Committee/Complaint Redressal Committee

• Oversight & Impact Assessment Committee (w.e.f. November 22, 2023)

The composition of statutory Committees, their respective roles and responsibilities are provided in detail in the Corporate Governance Report. i. Board Procedure:

The Board of Directors meets from time to time to transact the business in respect of which the Board's attention is considered necessary. The Board meets at least once in each quarter, which is scheduled in advance. There is a well-laid procedure to circulate detailed agenda papers to the Directors before each meeting and in exceptional cases these are tabled. The Directors discuss and express their views freely and seek clarifications on items of business taken up in the meetings. The discussions are held transparently. Various decisions emanating from such meetings are implemented to streamline the systems and procedures followed by the Company.

The Board regularly reviews the strategic, operational policy and financial matters of the Company. The Board has also delegated its powers to the Committees. The Board reviews the compliance of the applicable laws in the meeting. The Budget for the financial year is discussed with the Board at the commencement of the financial year and the comparison of the quarterly/ annual performance of the Company vis-a-vis the budgets are presented to the Board before taking on record the quarterly/ annual financial results of the Company. The requisite information as required is provided to the Board.

The information as specified in Regulation 17(7) of Listing Regulations is regularly made available to the Board.

Pursuant to the requirement under section 134(3)(c) and 134(5) of the Companies Act, 2013, the directors confirm: a. that in the preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departure, if any; b. that such accounting policies as mentioned in the notes to annual accounts have been selected and applied consistently and judgments and estimates have been made that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the profit of the Company for the year ended on that date; c. that 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. that the annual accounts of the Company have been prepared on a ‘going concern basis'; e. that proper internal financial controls are in place and that the financial controls are adequate and operating effectively; f. that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems were adequate and operating effectively.

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the Company with the Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large during the year under review. All the related party transactions were reviewed by the Audit Committee. There was no contract, arrangement or transaction entered during financial year 2023-24 that fall under the scope of first proviso to Section 188(1) of the Companies Act, 2013. As required under the Companies Act, 2013, the prescribed Form AOC-2 is appended as Annexure -H to the Board's report. The Policy as per SEBI (LODR) Regulations, 2015 is available on the website of the Company and can be accessed at http:// s3.amazonaws.com/luxs/ckeditors/pictures/345/original/ RPT_for_website.pdf. Further as required under Para A of Schedule V of Listing Regulations following promoters are holding more than 10% of shareholding as on 31st March, 2024 with whom transactions were held by the Company:

1. Mr. Ashok Kumar Todi

2. Mr. Pradip Kumar Todi

3. Mrs. Prabha Devi Todi

4. Mrs. Bimla Devi Todi

Disclosure of transaction with the above-mentioned promoters is provided in Note no. 32 to the Standalone Financial Statement.

The Company has one subsidiary i.e. Artimas Fashions Private

Limited (Unlisted Private Limited Company). Further the Company does not have any associates and there were no joint ventures entered into by the Company.

The Company has a vigil mechanism contained in the Whistle Blower Policy, in terms of section 177(9) of the Companies Act, 2013 and Regulation 22 of Listing Regulations, to deal with instances of fraud and mismanagement, if any. The purpose of this policy is to provide a framework to promote responsible and secure whistle blowing.

The Whistle Blower Policy also provides employees to report instances of leak of unpublished price sensitive information as required under sub-regulation 6 of Regulation 9A of SEBI (Prohibition of Insider Trading) Regulations, 2015. It protects employees wishing to raise a concern about serious irregularities within the Company.

A quarterly report with the number of complaints, if any, received under the Policy and their outcome is placed before the Audit Committee and the Board. The policy on vigil mechanism may be accessed on the Company's website: - http://s3.amazonaws. com/luxs/ckeditors/pictures/391/original/Whistle_Blower_ Policy.pdf

Your Company at its 27th Annual General Meeting held on September 20, 2022 had reappointed M/s S K AGRAWAL AND CO CHARTERED ACCOUNTANTS LLP (Firm Registration Number: 306033E) as Statutory Auditors of the Company for the second term of five consecutive years i.e., from the conclusion of the 27th AGM until the conclusion of the 32nd AGM of the Company to be held in the year of 2027 at a remuneration as may be fixed by the Board of Directors and Audit Committee as mutually agreed with Auditors. The Statutory Auditors have confirmed that they satisfy the independence criteria as required under the Act. M/s S K AGRAWAL AND CO CHARTERED ACCOUNTANTS LLP (Firm Registration Number: 306033E) Statutory Auditors of the Company have submitted their Independent Auditor's report on the Financial Statements of the Company for the year ended on March 31, 2024. The Auditors' Report on the Financial Statements of the Company for the year ended March 31, 2024 does not contain any qualifications, reservations or adverse remarks. The Auditor's Report is enclosed with the Financial Statements and forms part of the Annual Report. ii. Secretarial Auditors and Secretarial Audit Report:

As required under section 204 (1) of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s MR & Associates, Practicing Company Secretaries, Kolkata to undertake the Secretarial Audit of the Company. The Secretarial Auditors' Report of the Company for the year ended March 31, 2024 does not contain any qualifications, reservations or adverse remarks hence do not call for any further comments under Section 134(3) (f) of the Companies Act, 2013. The report is annexed as Annexure ‘I'. iii. Internal Auditor:

Ernst & Young LLP (EY), were appointed as the Internal Auditors of the Company to conduct the Internal Audit for the Financial Year 2023-24 in accordance with the provisions of Section 138 of the Act read with the Companies (Accounts) Rules, 2014. The Audit Committee considers and reviews the Internal Audit Report submitted by the Internal Auditor quarterly. iv. Cost Audit and Cost Records:p>

The provisions of Section 148 of the Companies Act, 2013, with respect to maintenance of Cost records and cost audit are not applicable to the Company. v. Fraud

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor have reported to the Audit Committee, under Section 143(12) of the Act, any instances of fraud committed against the Company by its Officers or Employees, the details of which would need to be mentioned in this Annual Report.

In compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 (‘the PIT Regulations') on prevention of insider trading, the Company had instituted a comprehensive Code of Conduct for regulating, monitoring and reporting of trading by Insiders. The said Code lays down guidelines, which advise Insiders on the procedures to be followed and disclosures to be made in dealing with the shares of the Company and cautions them on consequences of non-compliances. The Code of Internal Procedure and Conduct to Prohibit Insider Trading is available on the website of the Company - https:// s3.amazonaws.com/luxs/ckeditors/pictures/259/original/ Lux_Insider_trading_Code_v5_09082022.pdf and the Code of practices and procedures of fair disclosures of unpublished price sensitive information (UPSI) is available on the website of the Company - https://s3.amazonaws.com/luxs/ckeditors/ pictures/234/original/Code_of_Practices_and_procedure_ of_Fair_Disclosure.pdf

During Financial Year 2023-24 under review, Acuite Ratings

& Research Limited (previously known as SMERA Ratings Limited) has reaffirmed/downgraded the following rating without any enhancement in the limit in the long-term Bank facilities: -

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2024 is available on the Company's website at the link https://s3.amazonaws.com/ luxs/ckeditors/pictures/537/original/Dra__MGT-7.pdf

Your Company contributes towards sustainable development and fulfills its social, environmental, and economical responsibilities, creating a long-lasting value for all stakeholders. The Company is committed to maintain highest standards of ethics in all spheres of its business activities. In compliance with regulation 34(2)(f) of Listing Regulations and relevant SEBI Circulars issued in this regard, the Business Responsibility & Sustainability Report (BRSR) is annexed as

Annexure ‘J'.

Your Company has a structured framework for Cyber Security. The Risk Management Committee ensures the overall responsibility for oversight of cybersecurity frameworks. The Chief Information Officer ("CIO") of the Company is responsible for the information technology and cyber security related matters.

During the year under review, the Company had taken following initiatives: -a. The Company enabled the AI based Endpoint hosted in cloud for threat detection & prevention. b. The Company implemented the cyber protect cloud backup solution for end user data backup. c. The Company's SAP, financial and HR applications, are in fully secured private cloud and being monitored on regular basis.

In accordance with the SEBI Listing Regulations, the Board of Directors of the Company is responsible for framing, implementing and monitoring the risk management plans of the Company. The Company has a "Risk Management Policy" to identify risks associated with the Company, assess its impact and take appropriate corrective steps to minimize the risks that may threaten the existence of the Company. The Enterprise Risk Management (ERM) framework of the Company is comprehensive and robust enough to respond against any uncertainty. It has risk identification, analysis, evaluation and treatment mechanism, ensuring that smallest factor of uncertainty present in any layer is identified, evaluated and treated suitably. Risk Management Committee (RMC) of the Company on half-yearly basis, reviews the risks, adequacy of risk mitigating actions and identifies the new risks, takes strategic decisions to ensure that organization successfully achieves the business objectives and fulfils expectations of all its stakeholder. During the year under review, a detailed presentation before the Committee on risk management process was presented highlighting the various risk including the strategy risk, Business contingency risk, operational risk, financial risk, liquidity risk, IT & cyber security risk, Compliance risk & sustainability risk and the risk mitigation plan for addressing the issues. The Risk Management Policy of the Company has been updated on the website: http://s3.amazonaws.com/luxs/ckeditors/ pictures/389/original/Risk_Management_Policy.pdf

During the year under review, the industrial relations remained cordial and stable. The directors wish to place on record their appreciation for the excellent cooperation received from the employees at all levels.

During the year under review, there were no outstanding material litigations. Details of litigations/dispute are disclosed in the financial statements.

The Company complies with all applicable mandatory secretarial standards issued by the Institute of Company Secretaries of India.

As on March 31, 2024, total number of employees on the records of the Company were 3364 as against 3055 in the previous financial year.

Disclosure required in respect of employees of the Company, in terms of provisions of Section 197 (12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as Annexure- K and forms part of Directors'

Report.

Directors place on record their appreciation for the significant contribution made by all employees, who through their competence, dedication, hard work, co-operation and support, have enabled the Company to cross new milestones on a continual basis.

In compliance with the provisions of the Sexual Harassment of Women at Workplace Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act") and Rules framed thereunder, the Company has formulated and implemented a policy on prevention, prohibition and redressal of complaints related to sexualharassmentofwomenattheworkplacewhichisavailable on the website of the Company at https://s3.amazonaws. com/luxs/ckeditors/pictures/453/original/Policy_on_Sexual_ Harassment_of_women_at_workplace_2023.pdf.

The Company is committed to providing a work environment where every employee is treated with dignity, respect and equality. We maintain a zero-tolerance policy towards sexual harassment. Any act of sexual harassment invites serious disciplinary action. An Internal Complaints Committee has been set up.

Details of complaints received during the year under review are as under: a. Number of complaints filed during the financial year: NIL. b. Number of complaints disposed of during the financial year: NIL. c. Number of complaints pending as on end of the financial year: NIL.

The Company strives to conduct its business and strengthen its relationships in a manner that is dignified, distinctive and responsible. It adheres to highest ethical standards to ensure integrity, transparency, independence and accountability in dealing with its stakeholders. Accordingly, the following codes and policies have been adopted by the Company:

• Code of Conduct

• Vigil Mechanism/Whistle Blower Policy

• Risk Management Policy

• Nomination and Remuneration Policy

• Related Party Transaction Policy

• Corporate Social Responsibility Policy

• Code of Internal Procedure and conduct to Prohibit Insider Trading in Securities of Lux Industries Limited ("Company").

• Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI)

• Policy on Preservation of documents/Archival Policy

• Policy on Disclosure of Materiality for Disclosure of Events

• Policy for Prevention of Sexual Harassment at Workplace

• Business Responsibility and Sustainability Policy

• Dividend Distribution Policy

• Policy on determining Material Subsidiaries.

• Health, Safety and Environment Policy

The Company has not approved any new policy during the year, however the existing policies were amended and revised by the board as required under Companies Act, 2013 and SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. The policies are reviewed and updated periodically by the Board.

During the year, the board revised the following policies/ Codes:

The particulars relating to conservation of energy, technology absorption and foreign exchange earnings and outgo required to be disclosed under section 134(3) (m) of the Companies Act, 2013, are annexed hereto and forms part of this report as

Annexure ‘M'.

The Company has taken adequate insurance to cover the risks to its employees, property (land and buildings), plant, equipment, other assets and third parties.

During the year under review, the Company has not submitted any application and there is no pending proceeding against it.

Not Applicable.

The Securities and Exchange Board of India (SEBI) had conducted a probe and issued an ex-parte order on January 24, 2022 wherein 14 entities, including Mr. Udit Todi, Executive Director of the Company were restrained from accessing securities markets. The said order was further modified by SEBI on May 27, 2022 and allowed all the entities, including Mr. Udit Todi, Executive Director of Lux Industries Limited, to deal in all securities except in the scrip of Lux. SEBI has exonerated Mr. Udit Todi and concluded vide its order no. WTM/AS/IVD/ID1/29740/2023-24 dated November 6, 2023, that "the directions issued vide the interim order dated January 24, 2022, which were confirmed with modifications vide order dated May 27, 2022, against the Entities are revoked with immediate effect" and accordingly the interim and confirmatory orders stand revoked.

The Board wishes to place on record its sincere appreciation for the continued assistance and support extended to the

Company by its customers, vendors, investors, business associates, banks, central government, state governments, government authorities, employees and other stakeholders.

The Annexures referred to in this Report and other information which are required to be disclosed are annexed herewith and form a part of this Report of the Directors:

1. Scope Purpose and Objective

The Securities Exchange Board of India (SEBI) on July 8, 2016 has notified the SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2016 (Regulations).

Vide these Regulations, SEBI has inserted Regulation 43A after Regulation 43 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, which requires top five hundred listed companies (based on market capitalization of every financial year) to formulate a Dividend Distribution Policy, which shall be disclosed in its Annual Report and on its website.

Lux Industries Limited (the "Company") being one of the top five hundred listed Company as per the criteria mentioned above, the Company has approved and adopted this Dividend Distribution Policy (the "Policy") at its meeting held on February 13, 2017.

The intent of the Policy is to broadly specify the external and internal factors including financial parameters that shall be considered while declaring dividend and the circumstances under which the shareholders of the Company may or may not expect dividend and how the retained earnings shall be utilized, etc.

The Policy shall not apply to:

• Determination and declaration of dividend on preference shares, as the same was as per the terms of issue approved by the shareholders;

• Distribution of dividend in kind, i.e. by issue of fully or partly paid bonus shares or other securities, subject to applicable law;

• Buyback of Securities.

The Policy is not an alternative to the decision of the Board for recommending dividend, which is made every year after taking into consideration all the relevant circumstances enumerated hereunder or other factors as may be decided as relevant by the Board.

2. Effective Date

The Policy shall become effective from the date of its adoption by the Board i.e. February 13, 2017.

3. Definitions

• "Act" shall mean the Companies Act, 2013 including the Rules made there under, as amended from time to time.

• "Applicable Laws" shall mean the Companies Act, 2013 and Rules made there under, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015; as amended from time to time and such other act, rules or regulations which provides for the distribution of Dividend.

• "Company" shall mean Lux Industries Limited.

• "Board" or "Board of Directors" shall mean Board of Directors of the Company.

• "Dividend" shall mean Dividend as defined under Companies Act, 2013.

• "MD & CEO" shall mean Managing Director and Chief Executive Officer of the Company.

• "Policy or this Policy" shall mean the Dividend Distribution Policy.

• "SEBI Regulations" shall mean the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 together with the circulars issued there under, including any statutory modification(s) or re-enactment(s) thereof for the time being in force.

4. Parameters and Factors for declaration of Dividend

The dividend pay-out decision of the Board depends upon the following financial parameters and internal and external factors-

4.1.1 Financial parameters and Internal Factors: i. Operating cash flow of the Company ii. Net operating profit after tax iii. Profit available for distribution iv. Earnings Per Share (EPS) v. Working capital requirements vi. Capital expenditure requirement vii. Business expansion and growth viii. Likelihood of crystallization of contingent liabilities, if any ix. Up gradation of technology and physical infrastructure x. Creation of contingency fund xi. Acquisition of brands and business xii. Cost of Borrowing xiii. Past dividend payout ratio / trends

The Board of Directors of the Company would consider the following external factors before declaring or recommending dividend to shareholders: i. Economic environment ii. Capital markets iii. Global conditions iv. Statutory provisions and guidelines v. Dividend pay-out ratios of companies in the same industry.

Board of Directors shall endeavor to maintain the Dividend Payout Ratio* (Dividend/ Net Profit after Tax for the year) as near as possible to 25% of Lux Industries Limited's Standalone profit after tax, subject to

• Company's need for Capital for its growth plan

• Positive Cash Flow and other parameters stated in the policy.

The decision regarding dividend pay-out is a crucial decision as it determines the amount of profit to be distributed among shareholders of the Company and the amount of profit to be retained in business. The decision seeks to balance the dual objectives of appropriately rewarding shareholders through dividends and retaining profits in order to maintain a healthy capital adequacy ratio to support future growth. The shareholders of the Company may not expect dividend in the following circumstances, subject to discretion of the Board of Directors: i. Proposed expansion plans requiring higher capital allocation ii. Decision to undertake any acquisitions, amalgamation, merger, joint ventures, new product launches etc. which requires significant capital outflow iii. Requirement of higher working capital for the purpose of business of the Company.

iv. Proposal for buy-back of securities v. In the event of loss or inadequacy of profit

The Board may retain its earnings in order to make better use of the available funds and increase the value of the stakeholders in the long run. The decision of utilization of the retained earnings of the Company shall be based on the following factors:

• Market expansion plan.

• Product expansion plan.

• Increase in production capacity

• Modernization plan.

• Diversification of business

• Long term Strategic plans

• Replacement of Capital assets

• Where the cost of debt is expensive

• Dividend Payment.

Such other criteria's as the Board may deem fit from time to time.

4.4 Manner of dividend payout 4.4.1 In case of final dividend: i. Recommendation, if any, shall be done by the Board, usually in the Board meeting that considers and approves the annual financial statements, subject to approval of the shareholders of the Company. ii. The dividend as recommended by the Board shall be approved/declared at the Annual General Meeting of the Company. iii. The payment of dividends shall be made within the statutorily prescribed period from the date of declaration, to those shareholders who are entitled to receive the dividend on the record date/book closure period, as per the applicable law.

4.4.2 In case of interim dividend: i. Interim dividend, if any, shall be declared by the Board. ii. Before declaring interim dividend, the Board shall consider the financial position of the Company that allows the payment of such dividend. iii. The payment of dividends shall be made within the statutorily prescribed period from the date of declaration to the shareholders entitled to receive the dividend on the record date, as per the applicable laws. iv. In case no final dividend is declared, interim dividend paid during the year, if any, will be regarded as final dividend in the Annual General Meeting.

Since the Company has issued only one class of equity shares with equal voting rights, all the members of the Company are entitled to receive the same amount of dividend per share. The Policy shall be suitably revisited at the time of issue of any new class of shares depending upon the nature and guidelines thereof.

5. Disclosures

The Dividend Distribution Policy shall be disclosed in the Annual Report and the latest Dividend Distribution Policy with updates is on the website of the Company i.e. at https:// s3.amazonaws.com/luxs/ckeditors/pictures/535/original/ Lux__Dividend_Distribution_Policy.pdf

6. Policy Review and Amendments

6.1 This Policy would be subject to revision/amendment in accordance with the guidelines as may be issued by Ministry of Corporate Affairs, Securities Exchange Board of India or such other regulatory authority as may be authorized, from time to time, on the subject matter.

6.2 The Company reserves its right to alter, modify, add, delete or amend any of the provisions of this Policy.

6.3 In case of any amendment(s), clarification(s), circular(s) etc. issued by the relevant authorities, not being consistent with the provisions laid down under this Policy, then such Amendment(s), clarification(s), circular(s) etc. shall prevail upon the provisions here under and this Policy shall stand amended accordingly from the effective date as laid down under such amendment(s), clarification(s), circular(s) etc.

1. A brief outline of the Company's CSR policy, including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programs:

The Company strongly believes in development of and giving back to the society. Long term view is taken in implementation of the CSR program. The objective of the Company is to improve quality of life with direct intervention with the society. During the year the CSR expenditure was done in the following areas identified by the Company:

• Healthcare

• Promotion of Education

• Promotion of Sports

• Social Welfare of Socially and economically backward group

• Animal Welfare

• Ensuring Environmental Sustainability

• Promotion of Art and Culture

The Company has framed a CSR Policy in compliance with the provisions of the Companies Act, 2013 and Rules made thereunder. The CSR Policy provides for carrying out CSR activities in respect of those areas as provided in Schedule VII of the Companies Act, 2013.

2. Composition of CSR committee:

3. Provide the web-link where Composition of CSR committee, CSR Policy and CSR projects approved by the Board are disclosed on the website of the Company:

• Weblink for Composition of CSR Committee: http://s3.amazonaws.com/luxs/ckeditors/pictures/121/original/Composition_of_ Board_Commitee_2021.pdf

• The Composition of the Committee was reconstituted w.e.f. 01/04/2024 and same has been updated on website at https:// s3.amazonaws.com/luxs/ckeditors/pictures/505/original/Composition_of_Board_Committee.pdf

• Weblink for Lux Industries Limited CSR Policy: https://s3.amazonaws.com/luxs/ckeditors/pictures/95/original/CSR_Policy.pdf

• Weblink for Lux Industries Limited CSR Projects: https://s3.amazonaws.com/luxs/ckeditors/pictures/393/original/CSR_Project_ and_Annual_Action_Plan.pdf

4. Provide the details of Impact assessment of CSR projects carried out in pursuance of sub-rule (3) of rule 8 of the Companies (Corporate Social responsibility Policy) Rules, 2014, if applicable (attach the report)

The Company at present is not required to carry out impact assessment in pursuance of sub-rule (3) of rule 8 of the Companies (Corporate Social responsibility Policy) Rules, 2014.

5. (a) Average net profit of the Company as per sub-section (5) of section 135: _3,41,18,13,397/-(b) Two percent of average net profit of the Company as per section 135(5): _6,82,36,268/-

(c) Surplus arising out of the CSR projects or programmes or activities of the previous financial years: Nil (d) Amount required to be set o_ for the financial year, if any: Nil (e) Total CSR obligation for the financial year (b+c-d): _6,82,36,268/-

6. (a) Amount spent on CSR Project (both Ongoing Project and other than Ongoing Project): _6,43,34,800/- (b) Amount spent in Administrative Overheads: Nil (c) Amount spent on Impact Assessment, if applicable: Not Applicable (d) Total amount spent for the Financial Year (6a+6b+6c):_6,43,34,800/- (e) CSR amount spent or unspent for the Financial Year: _45,00,000/-

(f) Excess amount for set o_, if any

7. Details of unspent CSR amount for the preceding three financial years:

8. Whether any capital assets have been created or acquired through Corporate Social Responsibility amount spent in the Financial Year: Not Applicable

9. Specify the reason(s), if the Company has failed to spend two per cent of the average net profit as per sub-section (5) of section 135: The Company has transferred unspent amount towards the ongoing project to the Unspent CSR account amounting to _45,00,000/-.