Raj Rayon Industries Ltd

To

The Members,

Your Directors have pleasure in presenting 31^st Annual Report of the Company together with the Audited Financial Statements of the Company for the year ended 31^st March 2024.

During the financial year under review the Company has earned total revenue of Rs. 75,029.64/- Lakhs as compared to the previous years' revenue of Rs. 13,766.79 /- Lakhs. The Company has earned a net profit of Rs. 404.31/- Lakhs after considering exceptional items as compared to the previous years' loss of Rs. (1,237.68/-) Lakhs. Your Directors are continuously looking for avenues for future growth of the company.

In absence of adequate amount of profits for the year ended 31^st March, 2024 and past accumulated losses, your directors do not recommend payment of any dividend for the year ended 31^st March, 2024.

During the financial year under review, there was no change in the paid up share capital of the Company after the implementation of the Resolution Plan submitted by SVG FASHIONS PRIVATE LIMITED approved by the Hon'ble National Company Law Tribunal, Ahmedabad Bench (“NCLT”) vide its Order dated 05^th October, 2021, received on 7^th October 2021 (“said Order”).

As on 31^st March, 2024, the paid up share capital of the Company was Rs. 80,60,82,495/- divided into 556,082,495 equity shares of Re. 1/- each and 2,500,000 Compulsory Convertible Preference Shares (CCPS) Class- B of Rs. 100/- each.

CHANGES POST FINANCIAL YEAR

Based on market capitalization list issued by NSE India Limited for 31^st March, 2023 the Company was categorised under “TOP 1000 Companies'' basis that as per LODR company needs to comply with the additional compliance Which is applicable w.e.f. 1^st April, 2023, status of those compliances are as follows:

DEPOSITS:

During the financial year under consideration, your Company has not accepted any public deposits within the meaning of section 73 of the Companies Act, 2013 and the rules made there under.

INTERNAL CONTROL SYSTEM AND ADEQUACY:

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

The Company's Internal Audit department evaluates the efficiency and adequacy of internal control system and gives its report and recommendations to the Chairman of Audit Committee and based on Internal Audit Report the corrective actions are taken.

THE BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

As on the date of this report, the Board at present consists of 6 Directors. The Board of Directors is duly constituted. The details of present directors appointed is as below:

Details of all the Committee along with their composition and meetings held during the year under review are given in the Corporate Governance Report. The intervening gap between the companies was within the period prescribed under the Companies Act, 2013 read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

All Independent Directors have given declarations that they meet the criteria of independence as laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16 (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Separate meetings of Independent Directors, pursuant to Section 149 (7) read with Schedule VI of the Companies Act, 2013 was held on 29^th February, 2024.

In accordance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has constituted three committees of the Board, namely:

1. Audit Committee

2. Stakeholders Relationship Committee, and

3. Nomination and Remuneration Committee

4. Risk Management Committee (formed during financial year)

5. Management Committee (formed during financial year)

Details of all the Committees along with their charters, composition and meetings held during the financial year under review are provided in the Report on Corporate Governance, forming part of this Annual Report.

The Company has laid down a well-defined Risk Management Policy covering the risk mapping, trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out from time to time to identify, evaluate, manage and monitoring of both business and non-business risks. The Board is in process of adopting a practice for periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework.

Risk Management Committee comprised of Mr. Sandiip Satyanarayan Agarwwal, WTD and CFO, Mr. Vinodkumar Bajranglal Dalmia and Mr. Kailashnath Jeevan Koppikar, Independent Directors as its members. Mr. Sandiip Satyanarayan Agarwwal is Chairman of Risk Management Committee of the Committee. The Committee assists the Board of Directors in fulfilling its oversight responsibilities with regard to enterprise risk management. The Committee reviews the risk management practices and actions deployed by the Management with respect to identification, impact assessment, monitoring, mitigation and reporting of key risks while at the same time trying to achieve its business objectives.

This Committee's responsibilities include, achieving the objective of developing a risk mitigated culture that supports decision making and helps improving the Company's performance as stated in the Risk Management Policy of the Company. The role and terms of reference of the Risk Management Committee are in conformity with the requirements of the Act and Regulation 21 of the SEBI Listing Regulations.

In accordance with the provisions of Section 152 of the Companies Act, 2013 read with Companies (Management and Administration) Rules, 2014 and Articles of Association of the Company, Mrs. Sapna Rajkumar Agarwal (DIN: 00437469), Woman Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for re-appointment and your Board recommends her reappointment.

b. Appointment of Directors and KMP: There was no appointment/change of KMP during the year under review.

The Board members on recommendation of Nomination and Remuneration Committee of the Company appointed Mrs. Supriya M. Pujari (DIN-07661070) as Woman Independent Additional Director on the Board of the Company w.e.f. 27^th May, 2023 for a first term of five consecutive years, subject to the approval of the members of the Company. Further, the members of the Company approved her appointment as an Independent Woman Director of the Company for the first consecutive term of five years i.e. from 27^th May, 2023 up to 26^th May, 2028, by passing special resolution through postal ballot on 14^th July, 2023 in compliance with provisions of the Companies Act, 2013 read with the SEBI (LODR), Regulations, 2015.

c. Cession: There was no cessation of KMP during the year under review. However Mr. Ramesh Chandra Agarwal (DIN: 09364549), Independent Director of the Company resigned due to personal health reasons from closure of business hours w.e.f. 9^th November, 2023.

Brief resume of the director proposed to be appointed / re-appointed or to whose remuneration is to be approved as stipulated under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standard - 2 on General Meetings is given in the Notice convening the 31^st Annual General Meeting of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT:

The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that?

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis; and

(e) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

STATUTORY AUDITORS:

Pursuant to the provisions of section 139 and all other applicable provisions, if any of the Companies Act, 2013, and the rules framed thereunder, as amended from time to time, the Board members on recommendation of Audit Committee, re-appointed of M/s. Bagaria & Co. LLP Chartered Accountants (Firm Registration No - 113447W/W-100019) as Statutory Auditors of the Company (for a remaining period of his first term of five years) in their meeting held on 27^th May, 2023 till the FY 2026-27 i.e. for period of four years of their first term of appointment. The members of the company have approved the appointment of M/s. Bagaria & Co. LLP Chartered Accountants at their 30^th Annual General Meeting held on 30^th September, 2023.

M/s. Bagaria & Co. LLP Chartered Accountants have furnished a certificate of their eligibility under Section 141 of the Act and the Companies (Audit and Auditors) Rules 2014, confirming that they are eligible for continuance as Statutory Auditors of the Company.

The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments.

AUDITORS REPORT:

The Statutory Auditors of the Company has issued the Auditors Report for the Financial Year ended on March 31, 2024 with modified opinion stating that they cannot audit and comment on the impact, if any, on the financial statement arising out of subsequent availability of any pending bank statements of inoperative bank accounts which are continuing in the name of the Company from prior to the Corporate Insolvency Resolution Process when the current management was not in charge of the affairs of the Company was not available for verification for which management stated that the company is in process to obtain details in the matter.

The Auditors' Report does not contain any other qualification, reservation or adverse remark except as detailed herein above.

There was no instance of fraud reported by the auditor in their report under Section 143 (12) of the Companies Act, 2013.

The provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Ms. Riddhi Shah a Company Secretary in Practice to undertake the Secretarial Audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report (MR-3) is annexed herewith as Annexure -A.

With respect to observations made by the Secretarial Auditors in their report, we would like to state as follows:

Your Company always endeavour to comply with all the applicable rules and regulations.

Pursuant to the provisions of Section 178 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out annual performance evaluation of its own performance, the directors individually as well as evaluation of working of committees of Board of Directors.

Executive Directors were evaluated on the basis of targets / criteria given to them by the board from time to time as well as per their terms of appointment. Independent Directors, being evaluated by entire board except of Director being evaluated ,on meeting their obligations connected with their independence criteria as well as adherence with the requirements of professional conduct, roles, functions and duties specifically applicable to Independent Directors as contained in Schedule IV of the Companies Act, 2013. Chairman and other Non-Independent Directors were being evaluated by Independent Directors, who also reviewed the performance of secretarial department. Performance evaluation of the Committees and that of its members in effectively discharging their duties, were also being carried out by board.

The overall performance of Chairman, Executive Directors and Non-Executive Directors of the Company is satisfactory. The review of performance was based on criteria of performance, knowledge, analysis, quality of decision making etc.

Management Discussion and Analysis Report (MDAR) for the year under review, which also deals with the opportunities, challenges and the future outlook for the Company, as stipulated under Regulation 34 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 Agreement with the Stock Exchange of India, is presented in a separate section forming part of the Annual Report.

Your Company does not have any subsidiary, joint venture or associate Company.

The Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance requirements as stipulated by SEBI. The report on Corporate Governance as prescribed in Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms an integral part of this Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance along with a declaration signed by the Chairman and Managing Director stating that Members of the Board and Senior Management Personnel have affirmed the compliance vide Code of Conduct of the Board and Senior Management is attached to the report on Corporate Governance.

As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company's Auditors confirming compliance forms an integral part of this Report.

As per the provisions of Section 148 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, the Board of Directors of the Company on recommendation of Audit committee of the Company has re-appointed M/s. C SAHOO & CO., Proprietor Mr. Chandra Mani Sahoo Mem. No.: 18011 Practicing Cost Accountant Firm Registration No. (100665) as the Cost Auditor to conduct the Cost Audit for the financial year 2024-25 at a remuneration of Rs. 1,00,000/- (Rupees One Lakh Only) plus out of cost expenses and tax as applicable. A resolution seeking approval of the members for ratifying the remuneration payable to the Cost Auditor for financial year 2024-25 is provided in the Notice of the ensuing 31^st Annual General Meeting.

The Company maintained the cost accounts and records; the Cost Audit report was filed with authority for the FY 22-23 during the financial year under review.

Pursuant to the provisions of Section 138 of the Companies Act, 2013, read with Companies (Accounts) Rules, 2014, the Board on recommendation of the Audit Committee the Company has appointed M/s N.R Tibrewala & Co. LLP, Chartered Accountants Firm Registration No. (W100608) as the Internal Auditor of the Company from the financial year 2021-2022 until such time the Audit Committee/Board otherwise decide to revoke their appointment. Internal Auditor submits their reports to the Audit Committee on quarterly basis.

Based on the report of internal auditor, management undertakes corrective action in their respective areas and thereby strengthens the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee.

As required under Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the copy of Annual Return as on 31^st March, 2024 will be placed on the website of the Company and can be accessed on companies web site at www.rairavon.com

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

• We have Installed Air Preheater in the Exhaust of the Heaters which Reduces the Power Load to Heat the Air for Combustion of the Fuel in the Heaters & reduce the Flue Gas Temperature too.

• We Have Installed Air Coolers for the Condensation of the Vapours of the Process Column which Ultimately reduces the Water Purification Cum Power cost to Treat it from Bore well to the Condition where it can be Made Useable for the Process, also the Natural Cooling Reduces the Power Load of the Fans too of the Cooling Towers .

• We have been using the IE3 Motors for More Energy Savings.

• We have Designed the Continuous Polymerisation Plant Building is Such a way that the required Ventilation of Air is achieved without use of Exhaust Fans to remove the heat of the Building. This results in reduced capes and regular energy costs.

• All the old Electrical panels, Cables, transformers have been replaced by new latest technology equipment which will be more efficient and reduce monthly energy bills.

• New Variable frequency drives have been installed to ensure high efficiency and optimum use of energy.

• All new lights that are being installed are low power consuming LED type fittings.

• Elimination of Tedious process for movement of main raw materials;

The main raw material for the plant will be PTA which was previously coming in bags due to various reasons. We will bring PTA in tankers to our plant which will save the cost of transportation, cost of bags, handling costs and also electrical energy consumed during transportation to the height via electrical hoists. This will also save costs incurred due to pilferage during transportation of bags.

It was observed during regular cost audit exercise, that due to the temperature difference during day & night, It is possible to stop 50% electrical fans of all coolers in the night. This translates in considerable energy saving during the night.

Similarly regular energy savings are achieved by optimizing the plant process parameters & process activity due to reduced loads on all the cooling towers & chillers.

The company has also increased the use of electricity free turbo vent in place of electrical operated exhaust fan resulting in 100% savings.

The company has purchased new H.T. Power capacitor banks which will increase the power factor to nearly 1 and reduce energy costs.

We have already installed a direct melt transfer line to the POY plant which will bypass the process of making chips and save the energy consumed for cooling the polymer and cutting into chips, packing and transporting to POY area and re-heating and extruding at the PoY stage. This will be in addition to the assured uninterrupted supply to the POY lines for better production efficiency.

We are in the process of installing new POY production lines with better quality, higher efficiency and lower energy consumption and material wastage.

(C) Foreign exchange earnings and Outgo:

The details of net Gain on foreign currency transactions given in notes on Financial Statements for the year ended 31^st March, 2024

Foreign exchange Outgo during the year under review is as follows:

The Provisions with respect to Corporate Social Responsibility (CSR) as per provisions of Section 135 of Companies Act, 2013 read with rules framed thereunder was not applicable to the Company in the financial year under review.

However, your Company is enthusiastic to serve the society at large, which it will do in the coming years.

The Equity Shares of the Company are listed on the BSE Limited & NSE Limited. Shareholders are requested to convert their holdings to dematerialized form to derive its benefits by availing the demat facility provided by NSDL and CDSL.

The Company has received necessary declarations from each Independent Director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria for Independence as laid down in Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2016.

The Current policy is to have an appropriate proportion of executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. On March 31, 2024, the Board consists of six board members including CFO and three are independent directors. The Company has framed and adopted a Nomination and Remuneration Policy for appointment, remuneration and evaluation of Directors from time to time.

Pursuant to the requirement of the Companies Act 2013 and provisions of Listing Agreement applicable to the Company, your Company has adopted Vigil mechanism (Whistle Blower Policy) for complying with the Company's Code of Conduct and Ethics, and particularly to assuring that business is conducted with integrity and that the Company's financial information is accurate. The reportable matters may be disclosed by the employees to the Management / Managing Director / Chairman of the Audit Committee. No complaint was received during the Financial Year 2023-24.

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

All the related party transactions which were entered by the Company during the financial year were done on arm's length basis and were in the ordinary course of business of the Company. Also there are no materially significant related party transactions made by the company with Directors, Key Managerial Personnel, Promoter or any other designated persons which may conflict with the interest of the Company at large.

In accordance with the provisions of Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated the Related Party Transaction Policy and the same is uploaded on the Company's website at: https://www.rairavon.com/Pdf/Policv%20 Related%2Qpartv%20transcation.pdf

The Board of directors have agreed to forego any remuneration since the plan is still under implementation. Pursuant to that disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not provided in the Annual Report.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are required to be provided in the Annual Report. However there were no employees who were in receipt of remuneration for which details need to be disclosed.

Your Company would like to bring to the notice of the shareholders that the unpaid dividend which needs to be transferred to Investor Education & Protection Fund as per Section 125 of the Companies Act, 2013 was not done as there was no records available relating to the shareholders whose dividend are unpaid and hence the balance is lying in the Banks' unpaid dividend Account. As the unpaid dividend was per IBC take over by the new management the data was not handed over and the Bank account details are not available.

However post new management took over the company, they have not declared any dividend. AGREEMENTS BINDING LISTED ENTITIES:

Pursuant to Regulation 30A of the SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015, during the financial year, no agreement has been entered or executed by the shareholders, promoters, promoter group entities, related parties, directors, key managerial personnel and employees of the Company or with the Company or with a third party, solely or jointly, which, either directly or indirectly or potentially or whose purpose and effect is to, impact the management or control of the Company or impose any restriction or create any liability upon the Company.

a) The Company has not issued any bonus shares, sweat equity shares, shares with differential voting rights and equity shares on rights basis during the year under review.

b) The Company does not accept any deposit from its public.

c) It is not proposed to transfer any amount to reserves.

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

e) The provisions regarding receipt of remuneration or commission from holding or subsidiary of the Company are not applicable and hence, the disclosure under Section 197 (14) is not required.

f) The Company has not received any complaints under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has Internal Complaints Committee as per statutory requirement.

g) The Company has not bought back its shares, pursuant to the provisions of Section 68 of Act and the Rules made thereunder.

h) The Company has not issued any warrants, debentures, bonds or any non-convertible securities during the year under review.

i) The financial statements of the Company were not revised.

j) The Company has not failed to implement any corporate action.

k) The Company has complied with the Secretarial Standards issued by The Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings.

l) As there is no scheme pursuant to which such persons can beneficially hold shares as envisaged under section 67(3)(c) of the Companies Act, 2013, no Voting rights were directly exercised by the employees of the Company.

m) Except the implementation of the CIRP Process as per the Approved Resolution Plan has been implemented and completed during the previous financial year 2022-23

a. There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

b. There are no significant material changes and commitments affecting the financial position of the Company, which have occurred between the end of the Financial Year of the Company to which the financial statements relate and the date of this Annual Report.

c. There is no application made / proceeding pending under the Insolvency and Bankruptcy Code, 2016.

d. There was no instance of one-time settlement with any Bank or Financial Institution.

e. The Company was not required to carry out valuation of its assets.

f. Pursuant to Rule 19(2)(b) and 19(A) of the Securities Contract (Regulation) Rule, 1957 and Regulation 38 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI circular no. SEBI/HO/CFD/PoD2/P/CIR/2023/18 dated February 03, 2023, the Company needs to increase its MPS to 10% within a maximum period of twelve months from the date of such fall due to allotment of securities to Promoter/Promoter Group i.e. from 10^th June, 2022, however, the Company could not achieve the Minimum 10% of public shareholding on or before 10^th June, 2023 as per requirement.

Your Directors' would like to express their grateful appreciation for assistance and co-operation received from the Banks, Government Authorities, Customers, Vendors and Members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services of the Executives, Staff members and Workers of the Company.