To,

The Members,

Atharv Enterprises Limited.

Your Directors are pleased to present the 34^th Annual Report and the Company's Audited Financial Statement for the financial year ended March 31, 2024.

1. Financial Statements :

(Rs. In Lakhs)

2. Dividend :

During the year under review, the Company has decided to plough back the profit for the future expansion and activities of the Company. The Board therefore, does not recommend payment of any dividend for the year under review.

3. Financial Performance and Operational Review:

During the financial year 2023-2024:

I. Gross Sales of the Company for the year under review is Rs. 815.77 Lakhs as compared to Rs. 80.93 lakhs in the previous year.

II. Net Profit after Tax is Rs. 18.47 Lakhs as against Net Profit of Rs. 10.83 Lakhs of the previous year.

4. Change in the nature of business:

During the year under review, there was no change in the nature of the business of the Company.

5. Significant and Material Orders Passed by the Regulators or Courts:

No significant material orders have been passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations.

6. Subsidiary Companies & Associated Company:

During the year under review, the Company does not have any subsidiary company nor any Associates Company.

7. Adequacy of internal financial controls:

The Company has in placed adequate and effective Internal Financial Controls with reference to financial statements. During the year, such controls were tested and upgraded and no reportable material weaknesses in the design or operation were observed.

8. Particulars of Loans, Guarantees or Investments:

During the year under review, your Company has directly or indirectly given Loans, Guarantees or Investments. The Details is available in Schedule of forming Part of Balance Sheet of the Company.

9. Particulars of Contracts or Arrangements with Related Parties:

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of Company's business. The Company has not entered into any contract, arrangement or transaction with any related party which could be considered as material as defined under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Related party transactions under Accounting Standard - AS 18 are disclosed in the notes to the financial statements. Prescribed Form No. AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 is furnished as Annexure - A to this report.

10. Directors' Responsibility Statement:

Pursuant to section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, confirm that:

a. in the preparation of annual accounts for the year ended March 31, 2023, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b. 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 March 31, 2023 and of the Profit of the Company for the year ended on that date;

c. 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;

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

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

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

11. Directors and Key Managerial Personnel:

12. Declaration by Independent Directors:

The Company has received necessary declarations from all Independent Directors of the Company confirming that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 as well as under Regulation 25 and 16(1)(b) of SEBI (LODR) Regulations. There has been no change in the circumstances which may affect their status as independent director during the year.

13. Board Evaluation:

The Board of Directors has carried out an annual evaluation of its own performance, Board committees and Individual Directors pursuant to the provisions of the Act and the Corporate Governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015 ("SEBI Listing Regulations").

The performance of the Board was evaluated by the Board after seeking inputs from all the Directors on the basis of the criteria such as the Board composition and structure, effectiveness of Board processes, information and functioning, etc.

The performance of the Committees was evaluated by the Board after seeking inputs from the Committee members on the basis of the criteria such as the composition of Committees, attendance, prior study of materials given, participation at the meetings, level and effectiveness of Committee meetings, etc.

The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the Individual Directors on the basis of the criteria such as the contribution of the individual Director to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive Directors and Non-executive Directors. The same was discussed in the board meeting that followed the meeting of the Independent Directors, at which the performance of the Board, its committees and individual Directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the Independent Director being evaluated.

14. Familiarization Programme for the Independent Directors:

In compliance with the requirements of SEBI Regulations, 2015, the Company has put in place a familiarization programme for the Independent Directors to familiarize them with their role, rights and responsibilities as Directors, the working of the Company, nature of the industry in which the Company operates, business model etc. The details of the familiarization programme are explained in Corporate Governance Report.

15. Policy on Directors' Appointment and Remuneration and other details:

The Nomination and Remuneration Committee has laid down the criteria for Directors appointment and remuneration including criteria for determining qualification, positive attributes and independence of a Director. The following attributes/criteria for selection have been laid by the Board on the recommendation of the Committee:

• the candidate should possess the positive attributes such as leadership, entrepreneurship, business advisor or such other attributes which in the opinion of the Committee are in the interest of the Company;

• the candidate should be free from any disqualification as provided under Sections 164 and 167 of the Companies Act, 2013;

• the candidate should meet the conditions of being independent as stipulated under the Companies Act, 2013 and Listing Agreement entered into with Stock Exchanges, in case of appointment as an independent director; and

• the candidate should possess appropriate educational qualification, skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, corporate governance, technical operations, infrastructure or such other areas or disciplines which are relevant for the Company's business.

16. Number of Meetings of the Board:

During the year under review, Six (06) Meetings of the Board of Directors were held on 23.05.2023, 10.07.2023, 01.09.2023, 05.09.2023, 17.10.2023 and 17.01.2024. For details of the meetings of the Board, please refer to the Corporate Governance Report, which forms part of this report.

17. Audit Committee:

The details pertaining to composition of Audit Committee are included in the Corporate Governance Report, which forms part of this report.

The Audit Committee of the Board of Directors meets the criteria laid down under Section 177 of the Companies Act, 2013, read with Regulation 18 of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirement) Regulation, 2015 in the terms of reference to the Audit Committee.

18. Material Changes and Commitments, if any, affecting the Financial position of the Company which have occurred between the end of Financial Year of the Company to which the Financial Statement relate and the date of the Report

There were no material changes and commitments that have affected the financial position of the Company which have occurred during the financial year ended on 31^st March, 2024.

19. Change of Registered Office

There is no change in registered Office during the year under review.

20. Management Discussion and Analysis:

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosures Requirements) Regulation 2015, the Management Discussion and Analysis has been given hereunder:

ECONOMIC AND INDUSTRY OVERVIEW GLOBAL ECONOMY

Global Economy

The global economy demonstrated remarkable resilience in 2023, particularly following a period of receding inflation. This resilience was evident across several key indicators, including steady employment rates and rising incomes, both buoyed by favourable demand conditions. The overall economic landscape was further enhanced by increased government spending, robust household consumption, and higher labour force participation, collectively contributing to a positive economic outlook. The year 2023 saw substantial government spending aimed at revitalising various sectors, which played a pivotal role in stabilising the economy. Household consumption remained strong, supported by rising incomes and increased consumer confidence. Additionally, higher labour force participation indicated a more engaged and productive workforce, further enhancing economic activity. As a result, the global economy achieved a growth rate of 3.3% for the year. Looking ahead, the global economy is projected to maintain a steady growth trajectory, with expectations of a 3.2% increase in 2024 and a 3.3% rise in 2025. These projections suggest a moderate but consistent pace of expansion, highlighting the opportunities for continued economic resilience. However, the dynamic global landscape presents several challenges that must be navigated carefully to sustain this growth. Factors such as evolving geopolitical tensions, potential shifts in fiscal and monetary policies, and ongoing productivity concerns will play significant roles in shaping the future economic outlook.

Indian Economy

India continues to assert its position as the fastest-growing major economy, driven by robust domestic demand and supportive policies. The Indian economy recorded an impressive growth rate of 8.2% in 2023-24, up from 7.0% in 2022- 23, showcasing its resilience and dynamism. This significant growth could be attributed to several key factors. Firstly, there was a substantial increase in capital expenditure on infrastructure development, which laid a strong foundation for long-term economic growth. Additionally, there was a notable rise in private corporate investment, reflecting growing business confidence and expansion plans. Furthermore, improved consumer confidence spurred spending and investment, further enhancing economic momentum. This positive growth trajectory is expected to continue into 2024- 25, underpinned by several favourable trends. Improved goods exports are anticipated to drive economic activity, benefiting from a more competitive manufacturing sector and stronger global demand. Additionally, increased manufacturing productivity is expected to enhance the efficiency and output of the industrial sector, while higher agricultural output will support rural incomes and consumption.

The Government of India's enhanced focus on public capital expenditure, particularly in infrastructure projects, will continue to stimulate economic activity. Increasing private capital expenditure indicates growing business investment in capacity expansion and modernisation. The demand for credit is also rising, reflecting greater economic activity and business expansion. Moreover, moderating inflation is expected to support consumer spending and business investment, while low corporate debt levels and deleveraged balance sheets are likely to enhance financial stability and investment capacity. These factors collectively create a robust foundation for sustained economic growth. Consequently, the Indian GDP is projected to grow by 7.2% in 2024-25, reaffirming the country's status as a key driver of global economic growth and a promising destination for investment and business development.

Global Textile Industry

The textile market size has experienced robust growth in recent years, forecasted to increase from USD 638.03 Billion in 2023 to an expected USD 689.54 Billion in 2024, at a Y-o-Y growth of 8.1%. This growth is likely to be driven by factors such as global population increase, rising demand for manmade fibres, supportive government initiatives, strong economic growth in emerging markets, and a ban on plastic usage. Looking ahead, the market is projected to reach USD 903.45 Billion by 2028, at a CAGR of 7.0% from 2024 to 2028. The anticipated growth can be attributed to continued global population growth and urbanisation, rapid e-commerce expansion, rising leisure spending, increased retail penetration, and greater internet and smartphone usage. Additionally, the demand for contactless delivery solutions is expected to propel market growth further.

Key trends shaping the future of the textile market include the adoption of digital textile printing inks, non-woven and organic fibres, sustainable practices, blockchain technology in manufacturing, and digital platforms in supply chain management. Moreover, there is a growing focus on smart fabrics, robotics, automation, artificial intelligence, and strategic partnerships to develop innovative products.

Companies in the textile industry are well-positioned to capitalise on these trends by expanding their online presence, leveraging e-commerce platforms, and integrating advanced technologies.

OPPORTUNITIES AND THREATS AND FUTURE OUTLOOK GLOBAL ECONOMIC CONDITIONS

Opportunities: The Indian textile industry is witnessing a growing emphasis on sustainability, transcending beyond organic cotton and improved working conditions. Companies are now overhauling their entire value chain, from raw material sourcing to production, supply chain management, and waste recycling, shifting from a linear to a circular model. This comprehensive strategy addresses both pre- and post-consumer waste, positioning sustainability as a fundamental element of the industry's future.

The technical textiles sector is making strides by producing advanced fabrics through the application of cutting-edge technology to both natural and synthetic fibres. Emphasising durability, insulation, and heat resistance, fabrics like Nomex, Kevlar, and Spandex are finding applications across healthcare, automotive, construction, and security sectors. The growing demand for technical textiles, especially in medical, eco- friendly, industrial, sports, healthcare, automotive, and housing applications, is set to shape the future trajectory of the textile industry.

Threats: The industry is grappling with high material prices, which have been a persistent issue. Fluctuations in the costs of essential raw materials, such as cotton and synthetic fibres, can lead to increased production expenses, affecting profit margins.

A notable decline in export demand has been observed, with textile and apparel exports registering a decrease of 3.24% in 2023-24 compared to the previous year. This downturn is attributed to various global economic factors, including geopolitical tensions that affect international trade dynamics.

The ongoing geopolitical conflicts, particularly the situation stemming from the Russia-Ukraine war, have disrupted supply chains and created uncertainties in the global market. These conflicts contribute to a slowdown in demand for goods, further impacting the textile sector.

BUSINESS OVERVIEW

India is expecting another year of solid economic performance. The investment momentum was solid through the fourth quarter and should continue this fiscal, driven by public investments and a gradual pick-up in private investments aided by the PLI scheme. Government Capex, led by infrastructure, is budgeted for a sharp rise. This fiscal, private consumption is expected to continue to face crosscurrents. While lower inflation will be supportive, higher interest rates may curtail sectors such as automobile and housing. The economists predict growth to slow in FY25 as global conditions weigh down the economy. Growth is likely to moderate, in part, due to normalization of base effect.

RISK MANAGEMENT

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement and monitor the risk management plan for the Company. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Committee considers the risks that impact mid- to long-term objectives of the business, including those reputational in nature. The Company has an elaborate risk charter and risk policy defining risk management governance model, risk assessment and prioritisation process. The Risk Management Committee reviews and monitors the key risks and their mitigation measures periodically and provides an update to the Board on Company's risks outlined in the risk registers. The Audit Committee has additional oversight in the area of financial risks and controls. Additionally, a third-party organisation has benchmarked the Company's risk management practice with various companies in India and globally and pronounced it as a leader in FMCG category.

21. Risk Management:

The Company has in place a Risk Management Policy pursuant to Section 134 of the Companies Act. It establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk.

This risk management process, which is facilitated by internal audit, covers risk identification, assessment, analysis and mitigation. Incorporating sustainability in the process also helps to align potential exposures with the risk appetite and highlights risks associated with chosen strategies. The major risks forming part Risk Management process are linked to the audit.

The Audit Committee of the Board of the Company has been entrusted with the task to frame, implement and monitor the risk management plan for the Company and it is responsible for reviewing the risk management plan and ensuring its effectiveness with an additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

22. Control Systems and their Adequacy:

The Company has adequate internal control systems including suitable monitoring procedures commensurate with its size and the nature of the business. The internal control systems provide for all documented policies, guidelines, and authorization and approval procedures.

23. Corporate Social Responsibility (CSR):

The Provision of Section 135 of company act 2013 is not applicable to the company so the requirement of disclosure under this section is not required.

24. Safety, Environment and Health:

The Company's commitment to excellence in Health and Safety is embedded in the Company's core values. The Company has a stringent policy which drives all employees to continuously break new ground in safety management for the benefit of people, property, environment and the communities where we operate on sites.

The Company respects human rights, values its employees and their communities. The Company considers safety, environment and health as the management responsibility. Regular employee training programmes are in place throughout the Company on Safety, Environment and Health and has well identified and widely covered safety management system in place for ensuring, not only the safety of employees but surrounding population of the works as well.

25. Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace:

The Company has zero tolerance for sexual harassment at the workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. All employees of the Company, those of contractors as well as trainees are covered under this Policy.

No complaint was received from any employee during the financial year 2023-24 and hence no complaint is outstanding as on 31.03.2024 for redressal.

26. Vigil Mechanism/ Whistle Blower Policy:

There is a Whistle Blower Policy in the Company and that no personnel have been denied access to the Chairman of the Audit Committee. The policy provides for adequate safeguards against victimization of persons who use vigil mechanism.

27. Code of Conduct:

The Board has laid down a code of conduct for board members and senior management personnel of the Company. The code incorporates the duties of independent directors as laid down in the Companies Act, 2013. The Board members and senior management personnel have affirmed compliance with the said code of conduct. A declaration in this regard signed by the Chairman & Managing Director / CFO is given at the end of the Corporate Governance Report.

28. Prevention of Insider Trading:

The Board has adopted a revised Code of Prevention of Insider Trading based on the SEBI (Prohibition of Insider Trading) Regulations, 2015. All the Directors, senior management employees and other employees who have access to the unpublished price sensitive information of the Company are governed by this code. During the year under Report, there has been due compliance with the said code of conduct for prevention of insider trading.

29. Significant and Material Orders passed by the Regulators or Courts or Tribunals:

No significant material orders have been passed by the Regulators or Courts or Tribunals which would impact the going concern status of the company and its future operations.

30. Corporate Governance:

As per SEBI Listing Regulations, Report on Corporate Governance with Statutory Auditor's Certificate thereon, forms part of this report.

31. Human Resources:

The human resource plays a vital role in the growth and success of an organization. The Company has maintained cordial and harmonious relations with employees across various locations.

Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement.

32. Deposits from Public:

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public, was outstanding as on the date of the balance sheet but there is one Secured car loan and one unsecured loan as shown in the Balance Sheet.

33. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings And Outgo: Nil Technology absorption: Nil

Foreign Exchange earnings and outgo: Nil

34. Particulars of Employees and Remuneration:

Pursuant to the Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, no employee of the Company was paid remuneration exceeding the prescribed limits, during the financial year 2023-24.

35. Auditors:

Statutory Auditors:

M/s. J. Singh & Associates appointed as a Statutory Auditor of the company due to resignation of M/s. S. N. Kabra and Co., Chartered Accountants, bearing (FRN 03439C) who are the statutory auditors of the Company. , will hold the office in accordance with the provisions of the Act up to the Annual General Meeting to be held in the year 2029 and from whom necessary consent has been obtained under Section 141 of the Companies Act, 2013 are eligible continuing as auditors of the Company.

The Auditor Report for the Financial Year 2023-24 issued by M/s. S. N. Kabra and Co. does not contain any disqualification, reservation or adverse mark.

Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s. S Bhattbhatt & Co., Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the year ended March 31, 2024. The Secretarial Audit Report is annexed as Annexure B.

Secretarial Auditor's Report

Remarks or Qualifications by Secretarial Auditors and comments from the Board.

1. During the period under review, the Company had not paid Listing Fees of the Company for 2023-24 and received Notice - Stage 1 Reminder for payment of Annual Listing Fees for Financial Year 2023-24, Management Reply: The Company has paid Annual Listing Fees for Financial Year 2023-24.

2. During the period under review, the Company has not submitted Annual Report in XBRL Mode for the year ended March 31, 2023 as per SEBI (LODR) Regulations, 2015, Management Reply: Due to some technical issue the company is unable to upload the same on XBRL portal. The same was intimated with Stock Exchange.

3. During the period under review, as per Regulation 33(1) (d) of SEBI (LODR) Regulations, 2015, the Peer Review Certificate of Statutory Auditor expired and it is yet to be renewed by the Statutory Auditor. Management Reply: The Auditor has already applied for Peer review Certificate.

4. During the Audit period, the company has not complied with the requirement of Regulations 47- Advertisement in Newspaper of SEBI (LODR) Regulations, 2015, Management Reply: The Company will issue financial Results in Newspaper in compliance of Requirement of Reg. 47 of SEBI (LODR) Reg. 2015.

36. Details of Application made or Proceeding under 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 the Insolvency and Bankruptcy Code, 2016.

37. Details of Difference between Valuation amount on one time Settlement and Valuation while Availing Loan from Banks and Financial Institutions:

During the year under review, there has been no one time Settlement of loans taken from Banks and Financial Institutions.

38. Acknowledgement:

The Board places on record its deep appreciation for the continued support received from various clients, vendors and suppliers and Bankers, Government Authorities, Employees at all levels and Stakeholders, in furthering the interest of the Company.