Shree Digvijay Cement Co. Ltd

Dear Shareholders,

Your Board of Directors has immense pleasure in presenting 79^th Annual Report on business and operation of Shree Digvijay

Cement Company Limited ("Company") along with the audited standalone & consolidated financial statements for the year ended 31^st March, 2024.

FINANCIAL HIGHLIGHTS:

The financial highlights for the year under report are as under: ( in Lakhs)

OVERVIEW OF COMPANY'S FINANCIAL PERFORMANCE:

The Company's total income for the year 2024 was 80,097.34 lakhs, which was a record high and 9.43% higher than the previous year's income of 73,191.82 lakhs.

The year's pre-tax profit amounted to 11,820.67 lakhs, which was higher than 7,100.15 lakhs in the previous year. The year's post-tax profit reached 8,775.71 lakhs, which was 52% more than 5,771.30 lakhs in the previous year.

The main reasons for the growth were increased sales volume and stable plant operations. The record sales of blended and special products also contributed to the expansion of revenue and earnings. The increased productivity and profitability was mainly due to better plant performance resulting from asset optimisation and keeping the cost under control.

PRODUCTION AND SALES:

* Cement sales with 0.063 lakh ton used by Company as self-consumption. Last year self-consumption was 0.002 lakh tons.

The year under review saw Cement production rise to 13.48 lakhs MT from 12.74 lakhs MT and Clinker production grow to 10.34 lakhs MT from 9.74 lakhs MT. The Company achieved a record Cement Sale of 13.61 lakhs MT as compared to 12.59 lakhs MT in previous year.

There has not been any change in the nature of the business of the Company.

EXPANSION OF EXISTING MANUFACTURING FACILITIES:

Consequent upon Environment Clearance (EC) from the Ministry of Environment, Forest and Climate Change for capacity expansion of existing facilities of Cement, Clinker & Power in 2023, the Board of Directors has announced expansion at existing unit at Sikka. The new grinding unit project is under construction now and will be completed in the fourth quarter of FY 2024-25. After completion of the project, total cement capacity will increase to 3.00 MTPA. Accordingly, your Company is on track to strengthen its base and reach more markets.

DIVIDEND :

The Board of Directors is pleased to recommend a Dividend of

3/- (i.e. @30%) per equity share on 14,74,06,778 Equity Shares of 10/- each for the year ended 31^st March, 2024 payable to those Shareholders whose names appear in the Register of Members as on Record Date i.e. 19^th July, 2024.

Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of the Members w.e.f. 1^st April, 2020, and the Company is required to deduct tax at source from dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961. In terms of the provisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the "Listing Regulations"), the Company has formulated a Dividend Distribution Policy ("Policy"). The Dividend recommendation is in accordance with the Policy of the Company. The Policy is available on the Company's website and can be accessed at https://www.digvijaycement.com/wp-content/uploads/2021/12/Dividend-Distribution-Policy.pdf.

UNPAID DIVIDEND :

The Company currently has no unclaimed dividends that need to be transferred to the Investor Education & Protection Fund (IEPF), since the Company started declaring dividend from the year 2019-20.

TRANSFER TO RESERVES :

During the year under review the Company has not transferred any amount from Retained Earning to General Reserves.

SHARE CAPITAL :

During the year, the paid-up Equity Share Capital of the Company increased from 1,45,20,27,780/- (14,52,02,778 Equity Shares of 10/- each) to 1,47,40,67,780/- (14,74,06,778 Equity Shares of 10/- each). The increase in share capital was on account of the issue and allotment of fresh 22,04,000 equity shares of face value of 10/- each, arising out exercise of equivalent no. of stock options by eligible employees of the Company under "SDCCL Employee Stock Option Plan 2019" ("ESOP Plan"). The Company has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares to the Employees or Directors of the Company, other than under ESOP Plan.

No disclosures is required under Section 67(3)(C) of the Companies Act, 2013 ("Act") in respect of voting rights not exercised directly by the employees of the Company as the provisions of the said Section are not applicable.

CONTRIBUTION TO THE EXCHEQUER :

Your Company has been making substantial tax contributions over the years. In the year 2023-24, your Company has paid

27,633.50 Lakhs in total as taxes, duties, cess, royalty etc. to the State and Central Government.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES : WHOLLY OWNED SUBSIDIARY:

As of 31^st March, 2024, the Company has a Wholly Owned Subsidiary ("Subsidiary") Company viz. SDCCL Logistics Limited (CIN: U63000GJ2020PLC115066).

Presently, the Company does not have any material subsidiary. The Policy for determining Material Subsidiaries adopted by the Board pursuant to Regulation 16 of the Listing Regulations, can be accessed on the Company's website at https://www. digvijaycement.com/policies/.

ASSOCIATE COMPANY :

Pursuant to the Power Purchase Agreement and Share Purchase Agreement executed between Shree Digvijay Cement Company Limited (Company) and CGE Shree Digvijay Cement Green Energy Private Limited (CGESDC) for supply of wind and solar energy (hybrid power), the Company has on 18^th May, 2023, acquired 27% equity stake in CGESDC (a part of Continuum Green Energy group's portfolio of renewable energy project) for a contracted capacity of 8.10 MW hybrid wind and solar power. This 27% equity shareholding comprises 79,90,000 Equity Shares of Face Value of 10/- each at par and for a consideration of 7.99 Crores.

CGESDC is a subsidiary of Continuum Green Energy (India) Private Limited. However, by virtue of holding 27% equity in CGESDC, pursuant to Section 2 (6) of the Act, CGESDC is treated as an associate of the Company. Further, CGESDC became a Related Party of the Company under the Act and the acquisition of equity shares of CGESDC and other transactions between the

Company and CGESDC is at arm's length and in the ordinary course of business.

CONSOLIDATED FINANCIAL STATEMENTS:

The consolidated financial statements of the Company and its Subsidiary for the Financial Year 2023-24 are prepared in compliance with the Section 129(3) read with Schedule III of the Act and Rules made thereunder, including Indian Accounting

Standards (IND AS) specified under Section 133 of the Act. The audited consolidated Financial Statements together with the Auditors' Report thereon forms part of the Annual Report. Pursuant to Section 129(3) of the Act read with the rules made there under, a statement containing salient features of the Financial Statements of the Subsidiary is disclosed in Form AOC - 1 in this Annual Report.

The Financial Statements of the Subsidiary company are available for inspection by the Members at the Registered

Office of the Company pursuant to the provisions of Section

136 of the Act. The Company shall provide, free of cost, a copy of the Financial Statements of its Subsidiary company to the Members upon their request. The statements are also available on the website of the Company and can be accessed at www.digvijaycement.com under the ‘Investors' section.

FINANCIAL LIQUIDITY AND CREDIT RATING:

We remain free of debt and have enough cash to support our strategic and operational needs. We know that liquidity in the Balance Sheet has to strike a balance between earning sufficient returns and the need to address financial and business requirements. Liquidity allows us to be flexible and prepared for meeting unexpected strategic and business challenges, and opportunities.

As on 31^st March, 2024, cash and cash equivalent was

1,293.11 lakhs (excluding Fixed Deposits of 10,033.29 lakhs for more than 3 months) compared to 1,238.89 lakhs last year

(excluding fixed deposits of 9,953.81 lakhs).

Total cash and bank balance as on 31^st March, 2024 was

1,293.11 lakhs vis-?-vis 1,238.89 lakhs in the previous year.

CRISIL has confirmed the credit ratings for the Company's total bank loan facility of 100 Crores for the year. The long-term rating is CRISIL A/Stable and the short-term rating is CRISIL A1, indicating no change in the ratings.

The Company has a strong working capital management that involves a well-structured process, which enables ongoing tracking and oversight of receivables, payables, inventories, and other factors.

CASH FLOW STATEMENT:

As required under the applicable provisions of the Act and Listing Regulations, a Cash Flow Statement is attached to the Balance Sheet.

DEPOSITS :

Your Company has neither accepted any Deposits during the year under report nor did any deposits remain unpaid or unclaimed at the end of the year.

LOANS, GUARANTEES AND INVESTMENTS :

Your Company has neither given any loan or guarantee nor has made any investment, except Letter of Comfort to the Bank for availing credit facility upto 5 Crores by its Subsidiary as appearing under Note no. 5 of this report, during the year under report attracting the provisions of Section 186 of the Act.

DIRECTORS' RESPONSIBILITY STATEMENT :

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134 of the Act:

(a) in preparation of Annual Accounts for the financial year ended 31^st March, 2024, the applicable Indian Accounting Standards (Ind AS) have been followed along with proper explanation relating to material departures; (b) that such accounting policies as mentioned in the Notes to the Accounts have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at

31^st March, 2024 and 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 Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) that the annual accounts have been prepared on a going concern basis;

(e) that proper internal financial controls laid down by the

Directors were followed by the Company and such internal financial controls are adequate and were operating effectively; and (f) that proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems were adequate and were operating effectively.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION:

The Board has on the recommendation of the Nomination

& Remuneration Committee, framed a policy, inter alia, for nomination and appointment (including remuneration) of Directors, senior management, and key managerial personnel of the Company. The details of Nomination and Remuneration

Policy is stated in the Corporate Governance Report and uploaded on website of the Company at https://www. digvijaycement.com/policies/.

The Board of Directors of the Company follows the criteria for determining qualification, positive attributes, independence of Directors as per Nomination and Remuneration Policy and the Board Diversity Policy and other applicable policies of the Company.

Directors are appointed /re-appointed with the approval of the Members for a term in accordance with the provisions of the Act and the Articles of Association of the Company. The appointment of CEO and Managing Director is generally for a period of five years. All Directors, other than Independent

Directors, are liable to retire by rotation, unless otherwise

provided under the Articles of Association or under any statute or terms of appointment. One third of the Directors who are liable to retire by rotation, retire at every annual general Meeting and are eligible for re-appointment.

Further details on the election process, appointment of Directors and the details of remuneration paid to Directors and Managerial Personnel forms part of the Corporate Governance Report.

CONTRACTS / ARRANGEMENTS WITH RELATED PARTIES:

Details of contracts/arrangement with the Related Parties appear under Note no. 35b and form part of this report. All related party transactions that were entered into during the year under report were at arm's length basis and were in the ordinary course of business. There were no materially significant related party transactions which could have potential conflict with the interest of the Company at large.

Related Party Transactions are placed before the Audit Committee and before the Board, wherever required, for their approval. The Policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. The Company's management ensures total adherence to the approved Policy on Related Party Transactions to establish Arm's Length Basis without any compromise.

The Company has not entered into any transaction with any person or entity belonging to the Promoter/Promoter Group which hold(s) 10% or more shareholding in the Company. During the year, the Company had not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which is required to be reported in Form No. AOC-2 (Annexure-A) in terms of Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

MATERIAL CHANGES AND COMMITMENTS:

There were no material changes and commitments in terms of Section 134(3)(l) of the Act, affecting the financial position of the Company between the end of the financial year of the

Company as on 31^st March, 2024 and the date of this report i.e. 26^th April, 2024.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

It has been the Company's endeavor to focus on energy conservation and efficiency measures and accordingly were undertaken in various areas of the cement manufacturing during the year.

Information relating to conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo, required under Section 134(3)(m) of the Act is annexed hereto as Annexure-B and form part of this report.

PARTICULARS OF EMPLOYEES AND REMUNERATION:

Disclosure pertaining to the 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 annexed hereto as Annexure-C. In accordance with the provisions of Sections 197(12) & 136(1) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the list pertaining to the names and other particulars of employees drawing remuneration in excess of the limits set out in the aforesaid Rules, is kept open for inspection during working hours (upto the date of ensuing Annual General Meeting) at the

Registered Office of the Company, and the Report & Accounts are being sent to all the Members of the Company, excluding the aforesaid particulars of employees. Alternatively, any Member, who is interested in obtaining these details, may also write to the Company Secretary at the Registered Office of the Company or to email id at investors.sdccl@digvijaycement.com

EMPLOYEE STOCK OPTION PLAN (ESOP):

Pursuant to approval of Shareholders at the Annual General Meeting held on 5^th August, 2019 and in accordance with

SEBI (Share Based Employee Benefits) Regulations, 2014

("SBEB Regulations"), the Nomination and Remuneration Committee of the Board has, during the Financial Year 2019-20 granted 70,60,000 options at an exercise price of

16/- per option to eligible employees of the Company, as per the terms and conditions mentioned in SDCCL Employee Stock Option Plan 2019 ("ESOP Plan"). Out of total options granted, 23,65,000 (Twenty-Three Lakhs Sixty-Five Thousand) options got vested during the year. On exercise of rights by eligible employees, 22,04,000 underlying Equity Shares of 10/- each were allotted to them during the year in accordance with the ESOP Plan.

The certificate of the auditors regarding the implementation of the scheme being in accordance with SBEB Regulations and in accordance with the resolution of the Company in the general meeting, would be placed at the Annual General Meeting (AGM) or posted electronically for the inspection of the members. Applicable disclosure as stipulated under SBEB Regulation and Section 62(1) (b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 as on 31^st March, 2024 with regard to ESOP Plan is provided at Annexure-D to this report.

DIVERSITY AND INCLUSION

Diversity and Inclusion at workplace helps nurture innovation, by leveraging the variety of opinions and perspectives coming from employees with diverse age, gender, and ethnicity. The Company has organized a series of sensitization and awareness campaigns, to help create an open mind and culture to leverage on the differences. On and around International Women's Day, the Company has organized various program to sensitize employees and locals, inter alia, on significant role that women played in digitization and other activities of the Company. It has been the Company's endeavour to focus on women empowerment. Going forward, women empowerment activities will be spread, with clear focus on nurturing their career journeys, to help the Company build a pipeline of women leaders in near future.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has always provided a congenial atmosphere for work that is free from discrimination and harassment, including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, colour, marital status and sex.

The Company has in place Policy on Prevention, Prohibition and Redressal of Sexual Harassment in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has constituted an Internal Complaints Committee for redressal of grievances regarding sexual harassment received by the Committee. All employees are covered under this Policy. During the year under review, the Company has not received any complaints of sexual harassment. The Company has complied with all the applicable provisions of the said Act.

INSURANCE:

The Company's plants, properties, equipment, and stocks are adequately insured against all major risks including loss on account of business interruption caused due to property damage.

RISK MANAGEMENT:

The Company is aware of the risks associated with the business. It regularly analyses and takes corrective actions for managing/ mitigating the same. The Company has developed and implemented a Risk Management Policy that also includes the process for identifying, minimizing, and mitigating risks which is periodically reviewed by the Risk Management Committee, Audit Committee, and the Board of Directors.

They also review Risk Management procedures measures from time to time, to ensure that executive management controls risk through a properly defined framework. The major risks in critical areas have been identified by the Company and its mitigation process/measures have been formulated accordingly.

CORPORATE SOCIAL RESPONSIBILITY:

Your Company aims to remain essential to the society with its social responsibility, strongly connected with the principle of sustainability, an organization based not only on financial factors, but also on social and environmental consequences. It is responsibility of your Company to practice its corporate values through its commitment to grow in a socially and environmentally responsible way, while meeting the interest of Stakeholders.

The Company was the first industrial unit in the region, who started providing free drinking water and free medical amenities to nearby villagers, whosoever residing in the radius of more than 15 KMs around Company's business locations.

Our continually rising CSR spend on carefully crafted CSR programmes that consider the needs of our communities have helped us win their hearts and made them a part of Digvijay family. Key thematic areas of Digvijay's CSR activities include Healthcare, Hygiene & Sanitation, Promotion of Education and Women empowerment, Rural and Community infrastructure development, Water Conservation & Environmental protection, including employment creation initiatives and sustainable livelihood, promotion of sports and contribution for other social cause.

As required under Section 135 of the Act and Rules made thereunder, to demonstrate the responsibilities towards social upliftment in structured way, the Company has formed a Corporate Social Responsibility Policy. Due to resignation of Mr. KK Rajeev Nambiar, the Company has reconstituted the composition of Corporate Social Responsibility ("CSR") Committee of Directors comprising of Mr. Satish Kulkarni (Chairman), Mr. Anil Singhvi, Mr. Pramod Kabra and Mr. R. Krishnakumar. The Committee reviews and monitors the CSR projects and expenditure undertaken by the Company on a regular basis. The Company implements the CSR projects directly as well as through implementing partners.

The details of such initiatives, CSR spend etc., have been provided as Annexure-E to this Report, as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014

DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP): Directors

The Company has Six Directors on its Board. Detailed composition about the Board is disclosed in Corporate Governance Report.

All Directors have submitted relevant declarations / disclosures as required under the Act and Listing Regulations.

Appointment /re-appointment of Directors through Postal Ballot

The Shareholders vide postal ballot dated 19^th January, 2024, concluded on 6^th March, 2024 approved (1) the appointment of Mr. Ramanujan Krishnakumar (DIN: 10412896) as a Managing Director of the Company for 5 years effective from 16^th December, 2023 and (2) Reappointment of Mr. Anil Singhvi (DIN: 00239589) as Executive Chairman of the Company for another term of 5 years effective from 30^th April, 2024.

Re-appointment of Director

1. Mr. Pramod Kabra (DIN:02252403) Non-Executive Non-Independent Director Mr. Pramod Kabra retires by rotation at the ensuing AGM pursuant to the provisions of Section 152 of the Act read with the Companies (Appointment and Qualification of

Directors), Rules 2014 and the Articles of Association of your Company and being eligible, has offered himself for re-appointment as the Director.

2. Mr. Mahesh Gupta (DIN:00046810) - Non-Executive Independent Director Mr. Mahesh Gupta was appointed as an Independent Director at the 74^th AGM held on 5^th August, 2019, for a period of 5 years with effect from 30^th April, 2019 and up to the date of AGM in the year 2024. The Board has at their meeting held on 26^th April, 2024 re-appointed Mr. Mahesh Gupta (DIN: 00046810) as Independent Director in the category of Non-Executive Independent with effect from 30^th April, 2024.

The Board recommends reappointment of Mr. Mahesh Gupta as Non-Executive Independent Director of the

Company for a second term of five (5) consecutive years with effect from 30^th April, 2024.

As required by Regulation 36(3) of the Listing Regulations and provisions of the Secretarial standards, brief resume and other details of the above-mentioned directors getting appointed & re-appointed, are attached to the Notice of the ensuing AGM.

None of the Directors proposed for appointment / re-disqualified appointment at the ensuing AGM from being appointed /reappointed as Directors under the provisions of the Act, the Listing Regulations or any other order, directions of MCA, SEBI, or any other statutory authorities.

Resignation of Directors

Ms. Mini Menon (DIN: 7500434) has ceased to be a Non-Executive Independent Director of the Company with effect from 27^th April, 2023 due to her resignation arising out of her personal commitments and other pre-occupations. Your Board takes the opportunity to place on record deep appreciation for her contributions to the Company during her association as an Independent Director on the Board of the Company.

Mr. KK Rajeev Nambiar (DIN: 07313541) ceased to be a Director of the Company with effect from 15^th December, 2023 due to his resignation arising out of his personal commitments and other opportunities. Your Board takes the opportunity to place on record deep appreciation for his contributions to the Company during his association as Managing Director of the Company. Board Independence

Our definition of ‘Independence' of Directors is derived from Regulation 16(b) of the Listing Regulations and confirmation Section 149(6) of the Act. Based the / disclosures received from the Directors and on evaluation of the Independence of Directors during the Board evaluation process and assessing veracity of disclosures, the following Non-Executive Directors are Independent: a) Mr. Mahesh Gupta b) Ms. Mini Menon (ceased to be a Director w.e.f.

27^th April, 2023) c) Mr. Satish Kulkarni d) Ms. Mitu Samarnath Jha (Appointed w.e.f.

27^th April, 2023)

The Independent Directors have also confirmed that they have complied with Schedule IV of the Act and the Company's Code of Conduct.

In the opinion of the Board, the Independent Directors fulfil the conditions specified under the Act and the Rules made thereunder and Listing Regulations and are independent of the management. Independent Direcrtors are persons of high integrity. Further, in terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment and

Qualification of Directors) Rules, 2014, the Board is also of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the fields of strategy, business management, accounts & finance, auditing, tax and risk advisory services, legal, HR, IT, sales & marketing, logistics, people management, branding, infrastructure, technical, banking, insurance, financial services, investments, mining & mineral industries both in cement & other sectors and they hold highest standards of integrity.

Regarding proficiency, the Company has adopted requisite steps towards the inclusion of the names of all Independent Directors in the data bank maintained with the Indian Institute of Corporate Affairs (‘IICA').

Accordingly, all the Independent Directors of the Company have registered themselves with IICA for the said purpose. In terms of Section 150 of the Act read with the Companies (Appointment & Qualification of Directors) Rules, 2014, as amended vide No. GSR.774(E) dated 18.12.2020, wherever required, Independent Directors of the Company have undertaken to complete online proficiency self-assessment test conducted by the said Institute.

Key Managerial Personnel (KMP)

During the year under review, there is one change in Key Managerial Personnel i.e. Mr. R. Krishnakumar, Sr. Vice President (Manufacturing) was appointed as Chief Executive Officer (CEO) & Managing Director of the Company w.e.f. 16^th December, 2023 in place of Mr. KK Rajeev Nambiar, who ceased to be CEO & Managing Director w.e.f. 15^th December, 2023, due to his resignation.

The following are the Key Managerial Personnel of the Company as defined under Sections 2(51), 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Mr. R. Krishnakumar, Chief Executive Officer & Managing Director (w.e.f. 16^th December, 2023)

Mr. KK Rajeev Nambiar, Chief Executive Officer & Managing Director (till 15^th December, 2023)

Mr. Vikas Kumar, Chief Financial Officer

Mr. Suresh Meher, Vice President (Legal & HR) & Company Secretary

Succession Plan

Your Company has an effective mechanism for succession planning which focuses on orderly succession of Directors, Key Management Personnel and Senior Management. The Nomination and Remuneration Committee implements this mechanism in concurrence with the Board.

Annual Evaluation by the Board of its own performance, its committees, and Individual Directors

In terms of Policy on Evaluation of Performance of Directors and the Board, the Board has carried out an evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration Committees and other committees of Board as mandated under the Act and Listing Regulations. The criteria and manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Certificate of Non-Disqualification ofDirectors

In accordance with the Listing Regulations, a certificate has been received from M/s. Manoj Hurkat & Associates, Practicing Company Secretaries, that none of the Directors on the Board of the Company has been to act as Director. The same is annexed herewith as Annexure-F.

Board Diversity

The Company has over the years been fortunate to have eminent people from diverse fields to serve as Directors on its Board.

Pursuant to the SEBI Listing Regulations, the Nomination & Remuneration Committee of the Board has formalised a policy on Board Diversity to ensure diversity of the Board in terms of experience, knowledge, perspective, background, gender, age, and culture. The Policy on diversity is available on the Company's website www.digvijaycement.com.

Directors and Officers Insurance (‘D&O')

As per the requirements of Regulation 25(10) of the Listing

Regulations, the Company has taken Directors and Officers

Insurance (‘D&O') Policy for all its directors and members of the Senior Management.

NUMBER OF MEETINGS:

Meetings of the Board and its Committees are held as per statutory requirements and as per business needs. A calendar of meetings is circulated in advance to the Directors to enable them to plan their schedule for effective participation in the meetings. Due to business exigencies, the Board and Committees have also been approving several proposals by circulation from time to time.

Meetings of Board of Directors

During the year, five Board Meetings were convened and held on 27^th April, 2023; 27^th July, 2023; 27^th October, 2023; 1^st December, 2023 and 19^th January, 2024, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Act, Secretarial Standards– 1(SS-1) issued by the Institute of Company Secretaries of India and Listing Regulations.

The Company has the following six (6) Board-level Committees, which have been established in compliance with the relevant provisions of applicable laws and as per business requirements:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Risk Management Committee

4. Stakeholders' Relationship Committee

5. Corporate Social Responsibility (CSR) Committee disqualified

6. Committee of Directors for routine matters

Audit Committee

The Audit Committee comprises of three members, with the majority of Independent Directors. The Chairman of the

Committee is an Independent Director. The Committee met five times during the year.

Nomination and Remuneration Committee

The Company has a Nomination and Remuneration Committee comprising of three members, all members of which are Non-Executive Directors and two-thirds of the members are Independent Directors. The Committee met three times during the year.

Risk Management Committee

The Risk Management Committee comprises of three members, with the majority of Independent Directors. The Chairman of the Committee is an Independent Director. The Committee met twice during the year.

Stakeholders' Relationship Committee

The Stakeholders' Relationship Committee of Directors comprises of three members, with the majority of Non-Executive Directors. The Chairman of the Committee is an Independent Director. The Committee met once during the year.

Corporate Social Responsibility (CSR) Committee

The CSR Committee comprises of four members, of which one is Independent Director. The Committee met once during the reporting period.

More details about all the Committees of the Board, including details of the role and responsibilities of Committees, the particulars of meetings held and attendance of the Members at such meetings are stated in the Corporate Governance Report, which forms part of the Annual Report.

Statutory Auditors and their Report

M/s. BSR and Co. (BSR), Chartered Accountants, Mumbai (ICAI Firm Registration Number 128510W) from BSR & Affiliates network, were appointed as Statutory Auditor of the Company for a second term at the 78^th Annual General Meeting held on 28^th June, 2023 to hold office from the conclusion of the said Meeting till the conclusion of the 83^rd Annual General Meeting to be held in 2028.

The Statutory Auditors have confirmed that they are not to continue as Statutory Auditors and are eligible to hold office as Statutory Auditors of your Company.

Statutory Auditor have expressed their unmodified opinion on the Standalone Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, or disclaimers. The Notes to the financial statements referred in the Auditors' Report are self-explanatory.

Cost Auditors and Cost Audit Report

Pursuant to Section 148 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the Company has made and maintained the cost accounts and records for the year 2023-24. The Board of Directors on the recommendation of the Audit Committee appointed M/s. Kiran J. Mehta & Co., Cost Accountants, as the Cost Auditors of the Company for the financial year 2023-24. The Cost Audit Report for the financial year ended 31st March 2023 was filed with the Central Government on 11^th August, 2023 vide SRN No. F63096812.

Further, the Board of Directors has appointed M/s Kiran J Mehta & Co. as the Cost Auditors of the Company for the financial year 2024-25 and fixed their remuneration, subject to ratification by the shareholders at the ensuing AGM of the Company. M/s Kiran J Mehta & Co. have confirmed that their appointment is within the limits of Section 139 of the Act and have also certified that they are free from any disqualifications specified under Section 141 of the Act. The Audit Committee has also received a certificate from the Cost Auditor certifying their independence and arm's length relationship with the Company.

Necessary resolution ratification seeking Member's approval for of remuneration payable to the Cost Auditor for FY 2024-25, is included in the notice convening 79^th Annual General Meeting.

Secretarial Auditor and Secretarial Audit Report

Section 204 of the Act, inter-alia requires every listed company to undertake Secretarial Audit and annex with its Board's Report a Secretarial Audit Report given by a Company Secretary in practice in the prescribed form.

In line with the requirement of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Regulation 24A of the Listing

Regulations and other applicable provisions, if any, the Board of Directors of the Company had appointed M/s Manoj Hurkat & Associates, Company Secretaries in Whole-time Practice, to carry out Secretarial Audit for the financial year 2023-24.

The Secretarial Audit Report for the Financial Year ended 31^st March, 2024 is annexed as Annexure-G to this Report. This report is unqualified and self-explanatory and does not call for any further comments/explanations.

Tax Auditors

The Board of Directors, on the recommendation of the Audit Committee re-appointed M/s B S R and Co, Chartered Accountants, to carry out the Tax Audit for the Assessment Year 2024-25.

Internal Auditors

M/s. RSM Astute Consulting (RSM) has been the Internal Auditors of the Company for the year under review. The Audit

Committee of the Board reviews the audit findings of RSM and the remedial measures taken by the Company. The Board of Directors, based on the recommendation of the Audit Committee, re-appointed RSM to carry out the Internal Audit of the Company for the Financial Year 2024-25.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY :

The Company has an Internal Control System, commensurate with the size, scale, and complexity of its operations. The

Company has adequate internal financial control, which is constantly monitored by the Finance Department.

The Finance Department monitors and evaluates operating systems, accounting procedures and policies at all locations of the Company. Based on the report of external and Internal Auditors, the Audit Committee/ Board initiate corrective action in respective areas and thereby strengthens the controls. The scope, functioning, periodicity, and methodology for conducting internal audit is as per terms agreed by the Audit Committee in consultation with the Internal Auditor and as approved by the Board.

The Company had, in all material respects, an adequate internal financial controls system with respect to its financial statements for the year ended 31^st March, 2024, and that are operating effectively. More details on internal financial controls form part of the Management Discussion and Analysis Report.

ANNUAL RETURN AND OTHER POLICIES/ DOCUMENTS :

In line with the requirement of the Companies (Amendment) Act, 2017, effective from 31^st July, 2018, the extract of annual return is no longer required to be part of the Board Report. However, in Compliance to the provisions of Section 92 and Section 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return of the Company for the financial year ended 31^st March, 2024 and other policies of the Company is placed on the Company's website at www.digvijaycement.com.

MANAGING THE RISKS OF FRAUD, CORRUPTION AND UNETHICAL BUSINESS PRACTICES: Vigil Mechanism (Whistle Blower Policy) and Code of Conduct

Creating a fraud and corruption free culture has always been the core factor of your Company. In view of the potential risk of fraud, corruption and unethical behavior that could adversely impact the Company's business operations, performance, and reputation, Digvijay has emphasized even more on addressing these risks. To meet this objective, a comprehensive vigil mechanism named Whistle Blower Policy, in compliance with the provisions of Section 177(10) of the Act and Regulation 22 of Listing Regulations, is in place. The details of the Whistle Blower Policy are explained in the Corporate Governance Report and posted on the website of the Company at www.digvijaycement.com.

In addition to above policy, Company has in place the Code of Conduct ("Code"), Ethics, Anti-Corruption policy and other critical compliance policies which are laid down based on the Company's values, beliefs, principles of ethics, integrity, transparency, and applicable laws. Your Company has zero tolerance to bribery and corruption and is committed to act professionally and fairly in all its business dealings.

To create awareness about the Company's commitment to conduct business professionally, fairly, and free from bribery and corruption, regular training and awareness programs and workshops is conducted for all employees (both direct and indirect) across the organization.

More details about the Code are given in the Corporate Governance Report.

Code of Conduct to Regulate, Monitor and report trading by Insiders.

In terms of SEBI (Prohibitions of Insider Trading) Regulations, 2015, as amended from time to time, the Company has adopted a Code of Conduct for Prevention of Insider Trading ("Insider Code") as approved by the Company's Board. Any Insiders

(as defined in Insider Code) including designated employees

& persons and their relatives are, inter-alia, prohibited from trading in the shares and securities of the Company or counsel any person during any period when the "Unpublished Price Sensitive Information" are available with them.

The Insider Code also requires pre-clearance for dealing in the Company's shares and prohibits dealing in Company's shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT :

The Management Discussion and Analysis Report, which gives a detailed account of state of affairs of the Company's operations forms a part of this Annual Report.

CORPORATE GOVERNANCE REPORT:

The Corporate Governance Report forms an integral part of this Report, as annexed hereto as Annexure-H, together with the

Certificate from the Practicing Company Secretary regarding compliance with the requirements of Corporate Governance as stipulated in Part C of Schedule V to the Listing Regulations.

BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT (BRSR) :

Pursuant to Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility and Sustainability Report (‘BRSR') on initiatives taken from an environmental, social and governance perspective, in the prescribed format as annexed to this report as Annexure-I and also available on the Company's website: https://www.digvijaycement.com/.

TRANSFER OF SHARES ONLY IN DEMAT MODE :

As per SEBI norms, all requests for transfer of securities including transmission and transposition requests shall be processed only in demat form. The procedure to dematerialize shares is available at www.digvijaycement.com. Further vide circular date 24^th January, 2022, SEBI has notified that request for duplicate issuance, splitting and consolidation requests too will be processed in a demat mode only. The necessary forms are available on the Company's website www.digvijaycement. com.

MANDATORY UPDATE OF PAN, KYC AND NOMINATION DETAILS AND LINKING OF PAN AND AADHAAR BY HOLDERS OF SHARES IN PHYSICAL FORM:

SEBI, vide its circular dated 3^rd November , 2021 (subsequently amended by circulars dated 14^th December, 2021, 16^th March , 2023 and 17^th November, 2023) mandated that the security holders (holding securities in physical form), whose folio(s) do not have PAN or Choice of Nomination or Contact Details or Mobile Number or Bank Account Details or Specimen Signature updated, shall be eligible for any payment including dividend, interest or redemption in respect of such folios, only through electronic mode with effect from 1^st April, 2024 upon completion/submission of the requisite documents/details in entirety. Copies of relevant forms are available on the website of the Company at https://digvijaycement.com and on the website of Company's RTA at www.linkintimeindia.co.in. In case of any query / assistance, members are requested to contact the Company's RTA, M/s Link Intime India Private Limited, C-101, 247 Park, LBS Marg, Vikhroli (W), Mumbai – 400 083, Telephone No. 022-4918 6060 ,website: https://linkintime.co.in, email: rnt.helpdesk@linkintime.co.in.

LISTING OF EQUITY SHARES:

The Company's equity shares are listed on the BSE Limited and National Stock Exchange of India Limited.

More details about the Transfer of Shares and Listing of Shares are given in the Corporate Governance Report.

COMPLIANCE WITH SECRETARIAL STANDARDS:

The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India which have mandatory application during the year under review.

‘Excellence, is not an act but a habit' - Aristotle.

At Digvijay, we continuously invest in the development and improvement of our operations to achieve the world best. Your Company received several awards and recognitions during the year 2023-24.

Key recognitions among them are reflected through the following awards conferred on the Company: v 7^th Cement Review Awards 2023 - for being the second Fastest Growing Cement Company in Small Category v Award of Recognition in appreciation of Shree Digvijay's committed partnership in promoting the Quality Culture and building the quality ecosystem of our Country by Bureau of Indian Standards v Apex India Occupational Health & Safety Award 2023 in Platinum Category v Certificate of Winner of the Swachhta Pakhwada

Cleanliness Campaign - Second Award by Gujarat Pollution Control Board v 23^rd Greentech Environment Award 2023 by Greentech Foundation in Winner Category for Environmental Excellence v Award cemWHR 2023 as Winner under the category of innovation for Sustainability (Western Region) by Mission Energy Foundation

HOLDING ENTITY:

True North Fund VI LLP is the "Promoter" of the Company. During the year, there has not been any change in the number of shares held by Promoter. As at the end of the Financial Year 2023-24, the Promoter and the Holding entity continue to hold 8,08,25,928 fully Paid-up equity shares.

HUMAN RESOURCES:

Your people are your greatest resource. The Company has a structured induction process at all its locations. Your Company has a performance appraisal system for senior employees and junior management staff. HR dept is effectively involved in nurturing, enhancing and retaining talent through job satisfaction, management development programme etc. Your Company encourages and provides regular training to employees to improve their skills. In-house newsletters provide a forum for information sharing. Rewarding individuals for their contribution is part of motivation towards Excellence. More details on this section form part of Management Discussion and Analysis Report.

HEALTH AND SAFETY/ INDUSTRIAL RELATIONS:

The Company continues to accord high priority to the health and safety of employees at all locations. During the year under review, the Company conducted safety training programs for increasing disaster preparedness and awareness amongst all employees at the plant. Training programs and mock drills for safety awareness were also conducted for all employees at the plant. Safety Day was observed with safety competition programs with the aim to imbibe safety awareness among all the employees (both direct and indirect) at the Company. During the year under review, your Company enjoyed a cordial relationship with workers and employees at all levels.

DISCLOSURE REQUIREMENTS UNDER SECTION 134(3) OF THE COMPANIES ACT, 2013 :

Section 134(3) of the Act requires the Board's Report to include several additional contents and disclosures compared to the earlier law. Most of them have accordingly been made in the Corporate Governance Report at appropriate places that forms an integral part of this Report.

OTHER DISCLOSURES :

No disclosure or reporting is made in respect of the following items as required under the Act and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as there were no transactions during the year under review: ? Details relating to deposits covered under Chapter V of the Act.

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

? The Company does not have any scheme or provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

? The Managing Director of the Company does not receive any remuneration or commission from its subsidiary company.

Further your directors state that no disclosure or reporting is required in respect of following items as either there were no transactions on these items, or these items are not applicable to the Company during the year under review:

1) No company has ceased to be Subsidiary, Associate, or joint venture of the Company during the year under review.

2) No significant and material orders were passed by the regulators or courts or tribunals which impact the going concern status and Company's operations in future.

3) No fraud has been reported during the audit conducted by the Statutory Auditors, Secretarial Auditors and Cost Auditors of the Company.

4) During the year under review, no revision was made in the previous financial statement of the Company, except as otherwise required under applicable laws.

5) There are no proceedings pending against the company under the Insolvency and Bankruptcy Code, 2016.

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

ENVIRONMENT SUSTAINABILITY:

We believe in sustainable development. We regard social, economic, and environmental responsibility as an integral element of our business.

Your Company is an ISO 14001:2015 Environment Management

System Certified and adheres to ISO 45001 standards of

Safety and Occupational Health. Company gives top priority to health and safety of its employees (both direct & indirect) at its workplaces not only to avoid work related injuries and fatalities, but they are essential to effective business performance. With this approach, the Company switched over from OHSAS to the latest version of ISO 45001:2018 on Occupational Health and Safety Management Systems.

Professional Environment Auditors such as Det Norske Veritas, the State Pollution Board's certified auditors and Environmental

System Auditors conduct periodic in-depth environmental audit on our plant. The Audit Reports validate our commitment to environmental conservation. Large scale plantations in the mines, plants, colonies, and surrounding areas provide a lush green cover and reflect our respect for the environment.

ACKNOWLEDGEMENT :

Your directors are thankful to the Central and State Government Departments, Organizations and Agencies for their continued guidance and co-operation. The Directors are grateful to all valuable Stakeholders, Dealers, Vendors, Banks and other business associates for their excellent support and help rendered during the year. The Directors also acknowledged the commitment and valued contribution of all employees of the Company.

Your directors wish to place on record their appreciation for the support and guidance provided by its Parent Company/ Promoter.