Alkali Metals Ltd

To,

The Members,

Alkali Metals Limited

Your Directors have pleasure in presenting the 56^th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended 31^st March, 2024.

The results of our Operations for the Financial Year ended 31^st March, 2024 is summarized as below:

(All figures in Rs.Lakhs)

During the year 2023-24, the Company recorded a turnover of Rs.8,285.59 Lakhs and Net Profit of Rs.50.70 Lakhs compared to the turnover of Rs.8,823.27 Lakhs and Net Profit of Rs.282.09 Lakhs (after comprehensive items) of previous year 2022-23.

The global Industry slowdown and competition in the domestic market has contributed to a reduction in turnover by 6% as compared to the previous year. The overall Profit Before Tax was lesser by 59% as compared to the previous year which was mainly due to the lesser exports and the product composition.

The Board of Directors recommend dividend of 10% amounting Rs.1 per equity share of '10 each paid-up for the approval of the shareholders at the ensuing Annual General Meeting for the Financial Year 2023-24 and the said dividend will be paid to eligible shareholders as on the record date within 30 days of declaration by the shareholders.

During the year under review, Company had not transferred any amount to General Reserves.

As per market forecast the Chemical Industry is expected to grow at a CAGR 12% p.a. However, the market scenario has changed post the global economic slowdown and the geo political environment has contributed to fall in demand in the Eurozone. Thereby the exports have come down leading to a fall in turnover.

The Company is continuously working to improve the performance. There have been efforts to identify new products and devise a better product mix. With the gradual improvement in the US and Europe Markets, the Company anticipates a better performance in the Financial Year 2024-25.

The Company has spent Rs.133.63 Lakhs towards Research and Development during the Financial Year under review. The R&D team is putting its efforts to develop the new products and processes to ensure optimum material consumptions and effective yield.

The Company had not changed its nature of business during the year under review.

There are no material changes or commitments affecting the financial position of the Company between the end of the Financial Year and the date of the report.

There are no significant and material orders passed by the regulators or court or tribunals impacting the going concern status and Company operations in future.

Your Company had adequate internal controls and such procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including safeguarding of all its assets and prevention/detection of frauds and errors, accuracy and completeness of accounting records.

Auditors have verified the internal financial controls and tested the adequacy and the procedures adopted by the Company and confirm that the controls are adequate to the size of the transactions. The audit committee reviews and monitors the controls and processes on a regular basis.

The Management of the Company takes adequate steps in identifying, assessing, controlling and mitigating the risks associated with different areas of its business operations.

Your Company had no subsidiaries, Joint Ventures and associate companies during the Financial Year under review.

Your Company has not accepted any deposits covered under Chapter V of the Companies Act, 2013 during the year under review and also no outstanding deposits at the beginning ofthe Financial Year.

The members at the 51^st Annual General Meeting of the Company held on 3^IdAugust, 2019 had appointed M/s. G. Nagendrasundaram& Co., Chartered Accountants as Statutory Auditors for a term of 5 years beginning from the conclusion of the 51^st Annual General Meeting until the conclusion of the ensuing 56^th Annual General Meeting.

In this regard, the Audit Committee had identified and recommended to the Board the candidature of M/s. C K S Associates, Chartered Accountants as Statutory Auditors. They are eligible to be appointed and have provided a consent letter in this regard. Thereby the Board recommends their appointment to the members at the ensuing 56^th Annual General Meeting.

The Audit Report for the Financial Year 2023-24 does not contain any adverse remark/comment. However, the Auditors have made a self-explanatory factual disclosure in their CARO report which forms a part of the Audit Report. The disclosure was with regard to the technical issue on MCA portal which was being faced while filing IEPF forms.

The Board of Directors of the Company had appointed M/s. Ramakrishna & Associates, Chartered Accountants as Internal Auditors to conduct the Internal Audit of the company for the Financial Year ended 31^st March, 2024.

M/s. Ramakrishna & Associates, Chartered Accountants have been re-appointed as Internal Auditors for FY 2024-25.

The Board of Directors of the Company had appointed CS B. Venkatesh Babu, Practicing Company Secretary as Secretarial Auditor to conduct Secretarial Audit and provide Secretarial Compliance Report of the Company for the Financial Year ended 31^st March, 2024 and his report as enclosed does not contain any qualification, reservation or adverse remark. He has made a factual disclosure with regard to technical issue on MCA portal which was being faced while file the IEPF forms and this disclosure was self-explanatory.

CS B. Venkatesh Babu, Practicing Company Secretary has been re-appointed as Secretarial Auditor for FY 2024-25.

Your Company had not issued and raised any share capital including sweat equity, employee stock options during the Financial Year under review. Your Company has also not provided any money for purchase of its own shares by employees or for the benefit of employees.

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, a copy of the Annual Return of the Company is available at the Company's website www.alkalimetals.com.

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo have been provided in ANNEXURE - 1 and shall form part ofthis report.

In terms of Section 135 of the Companies Act, 2013, the Company has constituted Corporate Social Responsibility Committee to monitor the CSR activities of the Company in terms of the provisions of the Companies Act, 2013. The CSR committee comprises of following members:

i. Sri. K.V. Suryaprakash Rao- Chairman

ii. Sri. Y.S.R. Venkata Rao- Member

iii. Sri. G. Jayaraman- Member

For the Financial Year 2023-24 the provisions of the CSR were not applicable to the Company. However, the Company had voluntarily spent an amount of Rs.10 Lakhs towards CSR activities. The details of CSR during the year are provided in the ANNEXURE - 5.

The members had passed a special resolution at the 55^th AGM held on 21^st August, 2023, for reappointment of Sri Y.S.R. Venkata Rao, Managing Director w.e.f 1^st May, 2024 for a further period of 3 years and for re-appointment of Sri K.V. Suryaprakash Rao as Independent Director w.e.f 16^th October, 2023 for second term of 5 years.

The tenure of Dr. J.S. Yadav and Sri G. Jayaraman as Independent Director(s) is going to end on 20^th August, 2024. Accordingly, based on the recommendation of the Nomination and Remuneration Committee, the Board has recommended to the members at the ensuing AGM:

- appointment of Dr. J.S. Yadav and Sri G. Jayaraman as Non-Independent Non-Executive Director(s) ofthe Company.

- appointment of Sri Murali Krishna Chevuturi and Dr. Venkateswara Rao Thallapaka as Independent Director(s) ofthe Company.

Ms. Lalithya Poorna, Director, retires by rotation and is eligible for reappointment at the ensuing Annual General Meeting.

Details of number of Board meetings and profile of Directors are covered under the Corporate Governance section.

Company had received the declarations by all the Independent Directors that they meet the criteria of independence as per the provisions of Section 149 of the Companies Act, 2013 and they are registered with Indian Institute of Corporate Affairs (IICA) as per the amended provisions ofthe Companies Act, 2013.

Pursuant to the provisions of the Companies Act, 2013, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual Directors. Accordingly, the Chairman of the Nomination and Remuneration Committee obtained from all the Board members duly filled in evaluation templates for evaluation of the Board as a whole, evaluation of the committees and peer evaluation. The summary of the evaluation reports were presented to the respective Committees and the Board for their consideration.

During the financial year under review, Ms. K. Uma Kumari, Chief Financial Officer resigned due to her personal reasons and the Company is taking steps to fill the vacancy. Apart from her resignation there is no other change in the Key Managerial Personnel during the year under review.

As per the provisions of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, your Directors shall state that-

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

ii. they have 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 of the company for that period;

iii. they have 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;

iv. the annual accounts on a going concern basis; and

v. they have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

vi. proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Your Company has Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee, the details are provided in the Corporate Governance section.

The Company believes in the standard of conduct which all employees are expected to observe in their business endeavors. The Code (Vigil Mechanism) reflects the Company's commitment to principles of integrity, transparency and fairness. The copy of the Code of Vigil Mechanism is available on the Company website www.alkalimetals.com under Investors tab.

The Company has adopted a Whistle Blower Policy, as part of vigil mechanism to provide appropriate avenues to the Directors and employees to bring to the attention of the management any issue which is perceived to be in violation of or in conflict with the fundamental business principles of the Company. The employees are encouraged to voice their concerns by way of whistle blowing and all the employees have been given access to the Audit Committee.

Mr. Y.V. Prashanth, Executive Director is designated as ombudsperson to deal with all the complaints registered under the policy.

There has always been an endeavor on the part of the Company to create and provide an environment that is free from discrimination and harassment including sexual harassment. The Company had adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year, the Internal Complaints Committee has not received any complaints pertaining to incident of harassment.

The Company had not given any loans, guarantees or made investments as per the provisions of Section 186 of the Companies Act, 2013 during the Financial Year under review. Also there are no outstanding amounts of loans given, guarantees provided and/or investments made at the beginning of the year as well.

During the Financial Year under review, Company had entered into certain Related Party Transactions which are all on arms length basis; details of all such transactions as required under section 188 of Companies Act are annexed in Form AOC-2 forming part of the Board's Report as ANNEXURE-2.

The Company has formulated a policy on materiality of Related Party Transactions and dealing with Related Party Transactions which can be accessed at the Company website www.alkalimetals.com under Investors tab.

The Details required to be provided pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed and forming part of the Board's Report as ANNEXURE -3.

The following are the employees in receipt of remuneration as specified under Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time:

The top 10 employees' details will be provided upon specific request by the Shareholders of the Company.

Secretarial Audit Report including Secretarial Compliance Report as per SEBI (LODR) Regulations for the Financial Year 2023-24 obtained from CS B. Venkatesh Babu, Company Secretary in Practice is annexed and forming part of the Board's Report as ANNEXURE - 4.

In terms ofRegulation 34 ofthe SEBI (LODR) Regulations, 2015, a Report on Corporate Governance along with Compliance Certificate issued by Statutory Auditor's of the Company and also the Management Discussion and Analysis report is annexed and forms integral part of the Board's Report.

All the properties and insurable interests of the Company including Building, Plant and Machinery and Stocks have been adequately insured. The Company has-Directors & Officers Indemnity Policy- for Directors and Key Managerial Personnel, Group Accidental policy- for staff and workmen and Group Medical Policy - for those who are not covered under ESI.

The securities of the Company are continued to be listed on BSE and NSE. The listing fees for these stock exchanges are paid till the current Financial Year.

The provisions of Section 148 of the Companies Act 2013 for maintaining the Cost Records are not applicable to the Company.

The Company has duly complied with the applicable Secretarial Standards issued by The Institute of Company Secretaries of India, for the Board and General Meetings.

Your Directors express their gratitude to all Members, Staff and Workers, Bankers, Regulatory Authorities, Government, Customers, Suppliers, Business Associates from India and abroad for their continued support at all times and look forward to have the same in our future endeavours. Directors are pleased to record their appreciation of the sincere and dedicated services of the employees and workmen at all levels.

Your Directors look forward to the long term future with confidence.

For and on behalf of Board of Directors For Alkali Metals Limited