Apex Frozen Foods Ltd

To

The Members,

Your Directors have pleasure in presenting the 11th Annual Report together with the Audited Financial Statements for the Financial Year ended 31st March, 2023.

Financial Results

The performance of the Company for the financial year ended 31st March, 2023, is summarized below:

(Rs. in lakhs)

Overview of financial performance

During the year under review, your company has reported total income including net revenue and other income at Rs. 1,07,030.13 Lakhs as against Rs. 93,190.63 Lakhs in the previous year.

At the EBITDA level, the company reported a profit of Rs. 8,476.58 Lakhs for the current year as compared with Rs. 9,209.92 Lakhs in the previous year. Profit after tax for the current year stood at Rs. 3587.41 Lakhs as compared with Rs. 4,107.45 Lakhs in the previous year.

Dividend

The Board has recommended a dividend of Rs.2.50/- per Equity Share of 10.00/- each (25% of face value) for the year ended March 31, 2023. This payment is subject to your approval at the ensuing 11th Annual General Meeting of the Company.

I In view of the changes made under the Income Tax Act, 1961, by the Finance Act, 2020, dividend paid ordistributed by the Company shall be taxable in the hands of the shareholders. Your Company shall, accordingly, make the payment of the dividend after deduction of tax at source.

Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has approved and adopted the Dividend Distribution Policy and the same is available on the Company's website viz. https://apexfrozenfoods.in/wp-content/uploads/2021/12/ dividend-distribution-policu.pdf.

Transferor unclaimed dividend to investor education and protection fund

In accordance with the provisions of Sections 124 and ' 125 of the Act and Investor Education and Protection

Fund (Accounting, Audit. Transfer and Refund) Rules, 2016 ("IEPF Rules"), dividends of a company which remain unpaid or unclaimed for a period of seven years from the date of transfer to the Unpaid Dividend Account shall be transferred by the company to the Investor Education andProtection Fund ("IEPF").

In terms of the foregoing provisions of the Act, there are no amounts due to be credited to Investor Education and Protection Fund in accordance with Section 125 of the Companies Act, 2013, as at the year end.

Material changes and commitments

There were no material changes and commitments affecting the financial position of the Company that have occurred between the end of the Financial Year 2022-23 of the Company and the date of the report.

Transfer to reserves

During the year under review, no amount has transferred to General Reserve.

Fixed deposits

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

Share capital

The Authorised Share Capital of the Company as on date of Balance Sheet is Rs. 36,00,00,000/- divided into 3,60,00,000 equity shares of 10/- each.

The paid up share capital of the company as on date of balance sheet is 31,25,00,000/- divided into 3,12,50,000 equity shares of 10/- each.

(a) Change in the capital structure of the Company

There was no change in the capital structure of the company

(b) Status of Shares

As the members are aware, the Company's shares are compulsorily tradable in electronic form. As on March 31, 2023, 99.99% of the Company's total paid up capital representing 3,12,49,990 shares are in dematerialized form.

(c) Other shares

Your Company has not issued any equity shares with differential rights, Sweat equity shares, Employee stock options and did not purchase its own shares. Hence there is no information to be provided as required under Rule 4(4), Rule 8(13), Rule 12(9) and Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 and Section 62 of the companies Act 2013 respectively.

Details of Appointment/ Resignation of Directors and Key Managerial Personnel (KMP):

During the year under review,

• Mr. K Satyanarayana Murthy was appointed as the Executive Director & Chairman of the company, w.e.f. 01st December, 2022 for a period of 3 years at the AGM held on 23.07.2022.

• Mr. K. Subrahmanya Chowdary was reappointed as the Managing Director of the company, w.e f 01st December, 2022 for a period of 3 years at the AGM held on 23.07.2022.

• Mrs. K Neelima Devi was reappointed as Whole time Director w.e.f 01st February, 2023 for a period of 3 years.

• Mr. K. Subramanya Chowdary, Managing Director of the Company was appointed as Chief Financial Officer of the company w.e.f21.12.2022 without any additional Remuneration.

• In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. K. Satyanarayana Murthy (DIN:05107525), Executive Director & Chairman of the Company, will retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment

• Ms. Sarojini S, Company Secretary and Compliance Officer of the Company tendered her resignation from the office w.e.f. 14.08.2023.

• Ms. Swathi Reddy Billuri(ACS 71622) was appointed as Company Secretary & Compliance Officer of the company w.e.f. 14.08.2023.

Key managerial personnel:

The following persons functioned as Key Managerial Personnel during the year:

Mr.K.Satynarayana Murthy - Chairman Executive director

Mr.KSubrahmanya Choudary - Managing Director & CFO

Mrs. K.NeelimaDevi - Whole time Director

Mrs. S Sarojini - Company Secretary

Board Meetings:

During the financial year, the Board met 5(Five) times on 23-05-2022, 06-08-2022, 28-10-2022, 21-12-2022 and 04-02-2023. The meeting details are provided in the corporate governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.

Committees of the Board

Audit Committee

The Audit Committee was constituted pursuant to the Board meeting held on 27.01.2017 and reconstituted w.e.f01.01.2022. The scope and function of the Audit Committee is in accordance with Section 177 of the Companies Act, 2013.

The members of the Audit Committee as on 31.03.2023are as follows:

• Mr. Govindareddy Krishnamoorthy - Chairman

• Mr. B.Raghavulu Naidu - Member

• Mrs.Deepthi Talluri - Member

• Mr. K.Subramanya Chowdary - Member

None of the recommendations made by the Audit Committee were rejected by the Board. During the year under review, the Audit Committee met 4 times.

The details of the Committees of the Board viz., Audit Committee, Nomination and Remuneration Committee, CSR Committee, Stakeholders Relationship Committee and Risk Management Committee are reported in the Report on Corporate Governance, which forms part of the Board's Report.

Meeting of Independent Directors

The details of the separate meeting of the Independent Directors are reported in the Report on Corporate Governance, which forms part of the Board's Report.

Statement on Declaration Given by Independent Directors Under Sub-section (6) of Section 149

The Independent Directors have submitted their disclosures to the Board that they fulfil all the requirements as stipulated in Section 149 of the Companies Act, 2013, so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules

Familiarisation Programme for Independent Directors

All new Independent Directors (IDs) inducted into the Board are presented with an overview of the Company's business operations, products, organization structures and about the Board constitution and its procedures. A policy on familiarization program for IDs has also been adopted by the Company. Policy for familiarisation of Independent Directors is available at www.apexfrozenfoods.in

Annual evaluation of Board performance and Performance of its Committees and Directors

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

A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgments, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

Policy on Director's and Key Managerial Personnel Appointment & Remuneration:

Your company adopted the policy on Director's Appointment & Remuneration. The objective of the policy is to ensure that Executive Directors and other employees are sufficiently compensated for their performance. The Policy seeks to provide criteria for determining qualifications, positive attributes, and independence of a director and also recommend a policy relating to the remuneration for the directors and key managerial personnel. Policy is available at https://apexfrozenfoods.in/

Vigil Mechanism / Whistle Blower Policy

The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement, if any. The details of the Policy are explained in the Corporate Governance Report and also posted on the website of the Company and is available at https://apexfrozenfoods.in/

Risk Management Policy

Risk management is embedded in your Company's operating framework. Your Company believes that managing risks helps in maximizing returns. The Company's approach to addressing business risks is comprehensive and includes periodic review of such risks and a framework for mitigating risks and reporting mechanism of such risks. The risk management framework is reviewed periodically by the Board and the Audit Committee.

In terms of the requirement of Section 134(3)(n) of the Companies Act, 2013, the Company has developed and implemented the Risk Management Policy. The details of the Policy is available on the Company's website https:// apexfrozenfoods.in/

Risk Management Committee

Details of composition, scope of terms of reference of committee and other related details are set out in the Report on Corporate Governance which forms part of this Report.

Related Party Transactions

There are no transactions with related parties except remuneration to Key Managerial Persons as mentioned in notes to accounts, which fall under the scope of section 188(1) of the Companies Act, 2013.

The policy on Related Party Transactions as approved by the Board is uploaded on the website of the Company at https://apexfrozenfoods.in/

Particulars of loans, guarantees or investments made under section 186 of the companies act, 2013

During the year under review there were no loans, guarantees or investments made by the Company, under Section 186 of the Companies Act, 2013 and hence the said provisions are not applicable.

Credit rating

The details of credit ratings obtained by the Company and any revision thereto are disclosed in the Corporate Governance Report, which forms part of the Annual Report.

Directors' Responsibility Statement

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of its knowledge and ability, confirms that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no 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 the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts on a going concern basis;

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

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

Information about Subsidiary / Joint Ventures / Associate Companies

Your Company don't have any subsidiary or Joint Ventures or Associate Company. It is not a subsidiary or Joint Venture or Associate to any other Company.

Annual Return

Pursuant to the provisions of Section 92(3) and Section 134(3) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 as amended from time to time, the Annual Return of the Company as on 31st March, 2023 is available on the Company's website and can be accessed at www.apexfrozenfoods.in

Annual Secretarial Compliance Report

A Secretarial Compliance Report for the financial year ended 31st March, 2023, on compliance of all applicable SEBI Regulations and circulars / guidelines, will be submitted to the stock exchanges within 60 days of the end of the financial year. M/s. A.S.Ramkumar & Associates, Company Secretaries were issued the ASCR report for FY 2022-23 and the same is submitted to the stock exchanges..

Secretarial Standards

The Company has complied with Secretarial Standards formulated by the Institute of Company Secretaries of India and notified by the Central Government for implementation.

Corporate Governance Report

Your company's philosophy on Corporate Governance sets the goal of achieving the highest level of transparency with integrity in all its dealings with its stakeholders including shareholders, employees, lenders and others. A report on Corporate Governance along with a Certificate from M/S A.S.Ramkumar&Associates, Company Secretaries regarding the Compliance of Conditions of Corporate Governance as stipulated under SEBI (LODR) Regulations forms part of the Annual Reportas Annexure -I

a) STATUTORY AUDITORS

M/s Padmanabhan Ramani &Ramanujan, Chartered Accountants, Chennai, (Firm Reg.No. 002510S)were appointed as Statutory Auditors of the Company at Annual General meeting held on 23.07.2022 to hold the office for a period of 5 years, until the conclusion of 15th Annual General Meeting of the Company.

b) INTERNAL AUDITORS

The Board of Directors at their meeting held on 13.11.2020 have appointed M/s A.V.Ratnam & Co, Chartered Accountants, Kakinada, as the Internal Auditors of your company. Further, the Board of Directors of the Company appointed M/s. Praturi & Sriram, Charted Accountants, Hyderabad as Internal Auditors of the Company for FY 2023-24 in the Board meeting held on 14.08.2023.

c) SECRETARIAL AUDITORS

The Board has appointed M/s. A.S Ramkumar and Associates, Company Secretaries in Practice, to carry the Secretarial Audit under the provisions of section 204 of the Companies Act, 2013 for the financial year 2022-23. The Report of the Secretarial Auditor is annexed to this report as Annexure - II

Auditors Report

The observations made in the Auditors' Report are self explanatory and therefore, don't call for any further comments u/s 134 of the Companies Act, 2013.

Comments on Auditor Report

There are no adverse comments by the Auditor in the Audit Report and hence comments by Board of Directors of the Company on Auditor Report are not required.

Reporting of frauds by auditors

There are no frauds on or by your Company, as reported by the Statutory Auditors of your Company.

Disclosure under Sexual Harassment of Women at Workplace

The Company has in place the requisite Internal Committees as envisaged under the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013.

No complaints on the issues covered by the above Act were received during the year.

Corporate Social Responsibility (CSR)

The Annual Report on CSR activities in terms of the requirements of Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - III which forms part of this Report. The Company has a Corporate Social Responsibility Policy and the same has been posted on the website of the Company at www.apexfrozenfoods.in

Business Responsibility & Sustainability Report

Pursuant to the Regulation 34 of the SEBI Listing Regulations, Business Responsibility & Sustainability Report for the year ended 31st March, 2023 is provided separately and annexed to the Directors' Report as "Annexure-IV"

I. The steps taken or impact on conservation of energy:

a. Power saving initiatives taken by installation of Voltage frequency drives in machinery.

b. Power saving initiatives taken by installation of Voltage frequency drives in machinery.

II. The steps taken by the company for utilizing alternate sources of energy: Solar water heaters have been installed in place of electrical heaters. Solar security fencing has been done in place of electrical fencing.

III. The capital investment on energy conservation equipment's; NIL

Foreign Exchange Earnings and Outgo:

(Rs. in Lakhs)

Particulars of Employees

The information required under Section 197 of the Act and the Rules made thereunder, in respect of employees of the Company has been disclosed in ‘Annexure V'.

Management Discussion and Analysis Report

The Management Discussion and Analysis as required by the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is incorporated herein by reference and forms an integral part of this report as Annexure -VI

Internal Control Systems & their Adequacy

The Board has adopted policies and procedures for ensuring the 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 reliable financial disclosures.

Maintenance of Cost Records

The maintenance of Cost Records has not been specified by the Central Government under sub-section (1) of Section 148 of the Act, in respect of the business activities carried on by the Company.

Significant and material orders passed by the regulators or courts

1. SEBI Vide its adjudication order No. Order/BM/GN/2022-23/22612-22616 dated December 29, 2022 imposed penalties on the following persons/promoters of the company for insider trading during the period from 04.09.2017 to 28.02.2018:

Karuturi Subrahmanya Chowdary Vallepalli Hanumanth Rao Devalla Satya Madhavi Durga Prasad

2. Further, SEBI vide Final order No. QJA/VS/IVD/ID6/25067/2022-23 dated 28.03.2023 imposed disgorgement order against the following the promoters and Director of the Company:

Satyanarayana Murthy Karuturi Padmavathi Karuturi Ravi Kanth Sankuratri

Mr. Satyanarayana Murthy Karuturi, Mrs. Padmavathi Karuturi and Mr. Ravi Kanth Sankuratri have filed an appeal before Securities Appellate Tribunal against the SEBI Order dated 28.03.2023.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

During the year under review, there were no applications made or proceedings pending in the name of the company under IBC, 2016

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

During the year under review, there were no one time settlement of loan taken from banks and financial institutions.

Human resources

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Company's vision. Your Company appreciates the spirit of its dedicated employees.

Appreciation

The Board wishes to gratefully acknowledge the understanding and support received by the Company from its employees. It wishes also to thank the banking system, the Central Government, the various State Governments and the local authorities for the unstinted support received during the year.

This Report will be incomplete without a specific appreciation for the Members of the Company who have shown immense confidence and understanding in the Company's well being.