Avanti Feeds Ltd

Dear Members,

Your Directors have immense pleasure in presenting the Annual Report on the business and operations of your company along with the Audited Financial Statements (Standalone and Consolidated) for the Financial Year ended 31^st March, 2024.

1. Financial Summary

The summarized standalone and consolidated Financial Statements of your Company are given in the table below:

(Rs in Lakhs)

2. Summary of Operations & State of Company's Affairs

The profit for the year under consideration i.e., Financial year 2023-24, before depreciation, finance charges and tax is Rs 43,992.56 Lakhs as compared to a profit of Rs 33,057.49 Lakhs in the previous financial year i.e., Financial year 2022-23. The profit for the year after tax is Rs 30,805.65 Lakhs as against a profit of Rs 23,284.42 Lakhs during the previous financial year.

Your Company reported 5,31,967 MTs sales of Shrimp Feed during Financial year 2023-24 as compared to 4,97,550 MTs Shrimp Feed sales in the immediately preceding Financial year 202223, a growth of 6.92% in volume.

The Four Windmills of your Company located in Karnataka State with a total capacity of 3.2 MWs have generated 43.34 Lakh units as against 47.95 Lakh units in the previous year. The power generated during the year was sold to Karnataka Power Transmission Corporation Limited (KPTCL) under the Power Purchase Agreement (PPA).

There have been no material changes and commitments, which affect the financial position of the Company which have occurred between the end of the financial year to which the financial statements relate and the dates of this report.

During the year under review, there is no change in nature of the business of the Company. The affairs of the Company are conducted in accordance with the accepted business practices and within the purview of the applicable legislations.

3. Share Capital

During the year under review, there was no change in the share capital of the Company. Authorized Share Capital

The Authorized Share Capital of the Company as on 31^st March, 2024 is Rs 15,85,00,000 (Rupees Fifteen Crores and Eighty Five Lakhs) divided into 15,85,00,000 equity shares having face value of Rs 1/- each.

Paid-up Equity Share Capital

The paid-up Equity Share Capital is Rs 13,62,45,630 (Rupees Thirteen Crores Sixty Two Lakhs Forty Five Thousand Six Hundred and Thirty) divided into 13,62,45,630 equity shares having face value of Rs 1/- each.

Re-classification from promoter group to public

Pursuant to Regulation 31A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time, with effect from 13^th March, 2024, the BSE and National Stock exchange of India, approved the reclassification of Mrs. Madhavi Chukkapalli, holding 37,500 Equity Shares (0.03%) @ Rs1/- each, fully paid-up from "Promoter Group" category of the Company to "Public" category. Therefore, Mrs. Madhavi Chukkapalli has been removed from the "Promoter Group" category and was included in the "Public" category.

4. Reserves

During the year under review, an amount of Rs 2,500 Lakhs was transferred to Reserves out of the current year profits.

5. Dividend

Your Directors have recommend a dividend of Rs 6.75 (Six Rupees Seventy Five Paisa only) per equity share of Rs 1/- each fully paid for the Financial year 2023-24. The dividend, if declared by the members at the ensuing 31^st Annual General Meeting will be paid within the time line as prescribed under the Companies Act, 2013 ("the Act") subject to deduction of tax at source (TDS) as applicable.

The dividend, if approved, would result in a cash outflow of approximately Rs 9,197 Lakhs resulting in a dividend payout of 30.23% of the standalone profits of the Company.

The dividend recommended is in accordance with the Dividend Distribution Policy of the Company. The policy in terms of Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("Listing Regulations") is available on the Company's website at https://avantifeeds.com/policies/

6. Alteration of Articles of Association

During the year under review, your Company has not altered its Articles of Association.

7. Board of Directors

a. Composition of the Board

The Composition of the Board of Directors is in conformity with Regulation 17 of Listing Regulations. The present strength of the Board of the Company is as follows:

b. Number of Meetings of the Board

During the period, Eight (8) meetings of the Board of Directors were held. The details of the meetings held and attended by the Directors are given in the Report on Corporate Governance, which forms part of this Board's Report.

8. Changes in Directors and Key Managerial Personnel

During the year under review, Mr. Peerasak Boonmechote, who was appointed as an Additional Non-Executive Director w.e.f 20^th February 2023, appointed as Director vide approval of the members at the Extra-ordinary General Meeting held on 29^th April, 2023, by way of passing ordinary resolution.

Change in Nominee Director:

During the year under review, APIDC vide its letter dated 25^th September, 2023 withdrawn its nomination of Sri Gurrala Sudarsan Babu, (DIN: 09402807), from the Board of the Company and nominated Sri V. Ragunath, VC and MD of APIDC as Non-Executive Nominee Director, in his place. Hence, Sri Gurrala Sudarsan Babu, (DIN: 09402807) was resigned from the Board w.e.f. 25^th September, 2023. And subsequently Sri Raghunath Vemali, (DIN: 10405110) was appointed as Nominee Director in the Board Meeting held in 21^st December, 2023 and later on the members approved his appointment through postal ballot resolution dated 16^th February, 2024.

Appointment of Independent Director

1. During the year under review, Sri J. V. Ramudu, has completed his first term of Five (5) years as an Independent Director and Chairman of the Board of the Company. Based on the recommendation of Nomination & Remuneration Committee, the Board recommended the re-appointment of Sri J. V. Ramudu as an Independent Director on the Board of the Company for a second term of Five (5) consecutive years commencing from 10^th November, 2023, up to 9^th November, 2028 (both days inclusive), and the members given approval in the 30^th Annual General Meeting held on 11^th August, 2023.

2. The Board at its meeting held on 22^nd May, 2024, on the recommendation of Nomination and Remuneration Committee, appointed Smt. Y. Prameela Rani and Dr. Sunkara Venkata Satya Shiva Prasad as Non-Executive, Independent Directors for a period of Five (5) years w.e.f 9^th August, 2024 to 8^th August, 2029 (first term) is subject to approval of the members at the ensuing Annual General Meeting.

Retirement of Directors

In terms of Article 80 and 87 of the Articles of Association of the Company, Sri N. Ram Prasad and Mr. Peerasak Boonmechote, Directors liable to retire by rotation at the ensuing 31^st Annual General Meeting ("AGM") and being eligible, offer themselves for re-appointment. The Nomination and Remuneration Committee and Board recommended their re-appointment for approval of the Shareholders at the ensuing 31^st AGM.

Key Managerial Personnel ("KMP")

Dr. A. Indra Kumar, Chairman and Managing Director, Sri C. Ramachandra Rao, Joint Managing Director, Company Secretary, Compliance Officer and Chief Financial Officer, and Sri A. Venkata Sanjeev, Executive Director are the KMPs of the Company.

After the financial year, the Nomination & Remuneration Committee and Audit Committee at their Meetings held on 21^st May, 2024 and the Board of Directors at their Meeting held on 22^nd May, 2024 recommended the re-appointment of Sri A. Venkata Sanjeev, Whole-Time Director designated as an Executive Director for a period from 9^th August, 2024 to 31^st March, 2029, whose term of appointment will conclude on 8^th August, 2024, subject to approval of the Shareholders at the ensuing 31^st AGM.

Apart from aforesaid, there were no other changes in Directors and Key Managerial Personnel of the Company. The details of Directors, Key Managerial Personnel and composition of various Committees and changes of the Board are given in the Report on Corporate Governance which forms part of the Board's Report.

9. Committees of the Board

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

10. Familiarization Programme for Independent Directors

All Independent Directors are familiarised with the operations and functioning of the Company at the time of appointment and on an on-going basis. The details of the training and familiarisation programme are given in the Report on Corporate Governance which forms part of the Board's Report and is available on the website of the Company at www.avantifeeds.com/investors

11. Statement of Declaration given by Independent Directors

As required under Section 149 of the Act, the Independent Directors have submitted the declaration affirming that they meet the Criteria of Independence as provided in Section 149(6) of the Act and Regulation 25 of Listing Regulations. In the opinion of the Board, the Independent Directors of the Company possess necessary expertise, integrity and experience.

12. Separate Meeting of Independent Directors

A separate meeting of Independent Directors was held on 6^th April, 2024, to review the performance of the Non-Independent Directors and the Board as a whole, to review the performance of Chairperson of the Company and assess the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties. All the Independent Directors were present at the meeting.

13. Nomination and Remuneration Policy.

The Company's policy on Directors' Appointment and Remuneration and other matters as provided in Section 178(3) of the Act are given in the Report on Corporate Governance which forms part of the Board's Report and is also available on the website of the Company at https:// avantifeeds.com/ policies.

14. 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 31^st March, 2024 in e-form MGT-7, is available on the Company's website and can be accessed at www.avantifeeds.com/downloads/.

15. Loans, Guarantees or Investments

Pursuant to provisions of Section 186 of the Act, read with Companies (Meetings of Board and its Powers) Rules, 2014, the particulars of loans given, guarantees provided and investments made by the Company during the Financial year 2023-24 are disclosed in the notes to Financial Statements which forms part of this report.

16. Particulars of Contracts or arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the Financial year 2023-24 with related parties were in its ordinary course of business and are on an arm's length basis. 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 in terms of Section 134(3)(h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

However, the details of all the related party transactions are disclosed in the notes to the Financial Statements.

The Company formulated a Policy on dealing with Related Party Transactions. The policy is available on the Company's website and can be accessed at: https://avantifeeds.com/policies.

17. Evaluation of Performance of Board, Committees and Directors

Performance evaluation of the Board as a whole, the committees and all individual directors including Independent Directors has been carried out for the Financial year under review in accordance with the criteria framed pursuant to the provisions of the Companies Act, 2013, Listing Regulations and Guidance notes issued by SEBI. The manner in which the evaluation was carried out is given in the Report on Corporate Governance which forms part of the Board's Report.

18. Corporate Governance

Report on the Corporate Governance together with a Certificate from Independent auditors on compliance with conditions of Corporate Governance as stipulated under Listing Regulations forms part of this Board's Report.

19. Risk Management Policy

In terms of the requirement of Section 134(3)(n) of the Act, the Company has developed and implemented the Risk Management Policy. The Company has constituted a Risk Management Committee which frames, implements and monitors Risk Management Plan and lays down procedures periodically to inform the Board on the risk assessment and risk minimization procedures much before it was introduced as a Statutory Compliance.

The Risk Management Committee is in compliance with the provisions of Regulation 21 of Listing Regulations. The Company has adopted a structured Risk Management Policy in accordance with the provisions of the Act and Regulation 21 of Listing Regulations.

The Risk Management Committee has an additional oversight in the area of risk management. Any major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis.

The Board oversees Company's processes for determining risk tolerance and review management's action and comparison of overall risk tolerance to established levels. The framework is designed to enable risks to be identified, assessed and mitigated appropriately. Any major risks identified by the businesses and functions are systematically addressed through appropriate actions on a continuous basis.

20. Whistle Blower Policy-Vigil Mechanism

The Company has established a Whistle Blower Policy for its Directors and Employees to report their concerns about any unethical behavior, actual or suspected fraud or violation of the Company's code of conduct or ethics policy and Code of Conduct to regulate, monitor and report trading by Insiders. The practice of Whistle Blower Policy is overseen by the Audit Committee and no employee has been denied access to the Committee. The Whistle Blower Policy is available at the Company's website at https://avantifeeds.com/policies/.

21. Maintenance of Cost Records

The Company has maintained the Cost records as required to be maintained under Section 148(1) of the Act.

22. Corporate Social Responsibility (CSR)

As per Section 135(5) of the Act, the Company shall ensure that an amount of 2% of the average Net Profits of the Company made during the three immediately preceding financial years shall be spent towards Corporate Social Responsibility activities. For the Financial year 2023-24, the amount to be spent towards CSR activities works out to Rs 569.10 Lakhs. The Company has spent Rs 269.10 Lakhs towards the CSR activities in the Financial Year 2023-24 and Rs 300.00 Lakhs has been set aside for the utilization of ongoing project, AU-AVANTI - Aquaculture Skill Development Center and Avanti Vocational Training Centers to be established.

The Annual Report on CSR activities in terms of the requirements of Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed at Annexure-1, which forms part of this Board's Report.

23. Subsidiaries, Joint Ventures and Associate Companies

1. Avanti Frozen Foods Private Limited ("AFFPL"):

During the year, AFFPL has reported a turnover of Rs 1,08,186.65 Lakhs and the profit before tax is Rs 13,627.51 Lakhs. The Profit after tax reported by AFFPL is Rs 9,209.40 Lakhs for the Financial year 2023-24.

The Secretarial Audit report of AFFPL as required under regulation 24 A of the Listing Regulations, is provided as a separate annexure forming part of this Board's Report. Further, the annual report is being sent to the members excluding the aforesaid annexure. The same is available for inspection and any member interested in obtaining a copy of the same may write to the company at investors@avantifeeds.com.

2. Avanti Pet Care Private Limited (APCPL):

During the year under review, the Company has incorporated a new Subsidiary Company i.e. Avanti Pet Care Private Limited (APCPL) on 18^th July, 2023, in the state of Telangana, India for the purpose of setting up Pet Care Products project with 51% equity participation. Initially, the subsidiary Company incorporated with Dr. A. Indra Kumar and Sri A. Venkata Sanjeev as promoter Director, subsequently it will be joined by foreign collaborator. At present the Memorandum of Understanding followed by Technical Collaboration Agreement with JV Agreement had already executed between the Partners. The Company has not yet commenced its commercial production.

3. Srivathsa Power Projects Private Limited ("SPPPL"):

The Company continued to stop generating power due to increase in APM-gas and non availability of APM-gas since May, 2022. In addition to that in the month of July, 2022, Gail India Limited - a Government of India undertaking - a Maharatna Company, who is a natural gas supplier to Srivathsa, had informed that, as per the Ministry of Petroleum and Natural Gas guidelines and directives, the APM gas from KG basin allocated to power plants will be diverted to CGD (City Gas Distribution) entities outside KG basin w.e.f 01^st August, 2022. As per the above guidelines, Srivathsa is not getting APM gas from Gail India Limited. As a result, there is no power generation during the financial year. During the year 2023-24, the Company reported Other Income of Rs 23.74 Lakhs and a loss of (Rs 161.42) Lakhs after charging interest and depreciation, as per audited financials.

23.2 The consolidated financial statements of the Company and its subsidiaries were prepared in accordance with the accounting principles as generally accepted in India, including the Accounting Standards as specified under Section 133 of the Act, read with relevant Rules, form part of the Annual Report and are reflected in the Consolidated Financial Statements of the Company.

23.3 The Annual financial statements of the subsidiaries and related detailed information will be kept at the Registered Office and Corporate Office of the Company and also at the Registered Offices of the respective subsidiaries and also available on the website of the Company at https://avantifeeds.com/financial-reporting.

23.4 The Company has adopted a Policy for determining Material subsidiaries in terms of Regulation 16(1)(c) of Listing Regulations. The Policy approved by the Board is available on the website of the Company at https://avantifeeds.com/policies/.

23.5 Joint Ventures

Your Company has no Joint Venture.

23.6 Associate Company

Patikari Power Private Limited ("PPPL")

The Company holds 25.88% equity shares in PPPL which has a 16 MW Hydel Power Project in Himachal Pradesh, India. During the Financial year 2023 24 as per audited financials the Company generated 36.13 Million saleable energy units,

yielding a gross sales income of Rs 693.15 Lakhs which resulted in a net profit of Rs 82.71 Lakhs after charging interest, depreciation and tax. For the FY 2023-24, the Company has not declared any dividend to the shareholders during the financial year 2023-24 as the plant was shutdown from 12^th August, 2023 to 24^th February, 2024 due to heavy rains with unexpected floods and land slide the project was heavily damaged. The plant was restored and the damaged was recovered thru Insurance.

23.7 Names of companies which have become or ceased to be, its Subsidiaries, joint ventures or Associate companies:

During the year under review, the Company has incorporated a new Subsidiary Company i.e. Avanti Pet Care Pvt. Ltd. (APCPL) on 18^th July, 2023. There were no Joint Ventures or Associate Companies incorporated or ceased during the year.

Statement containing salient features of financial statements of subsidiaries and associates. Pursuant to Section 129(3) of the Act, the statement containing the salient features of the financial statements of Company's subsidiary and associate companies in the Form AOC-1 is enclosed at Annexure-2 of Board's Report.

24. Management Discussion & Analysis

A Report on Management Discussion and Analysis (MDA) which forms part of the Board's Report as per the requirements of Regulation 34 of Listing Regulations is enclosed at Annexure-3.

25. Business Responsibility and Sustainability Report

The Business Responsibility and Sustainability Report (BRSR) of your Company for the Financial year 2023-24, which forms part of this Board's Report as required under regulation 34(2)(f) of listing regulations is enclosed at Annexure-4.

26. Listing at Stock Exchanges

The equity shares of your Company continue to be listed and traded on the BSE Limited and National Stock Exchange of India Limited. The Annual Listing fee for the Financial year 2024-25 has been paid to both the Stock Exchanges.

27. Internal Controls Systems and Adequacy

The Company has in place an adequate system of internal controls. The details of the internal controls System are given in the MDA Report which forms part of the Board's Report.

The internal financial controls with reference to the Financial Statements for the Financial year ended 31^st March, 2024 commensurate with the size and nature of business of the Company.

The measures implemented for internal financial controls include multiple authority levels for approval of expenditures, budgetary controls and internal audit etc.

28. Audit and Auditors

a. Independent Auditors, their Report and Notes to Financial Statements

M/s. Tukaram and Co. LLP, Chartered Accountants (Firm Registration No. 004436S/ S200135) were re-appointed as Statutory Auditors of the Company at the 29^th AGM held on 12^th August, 2022, to hold office till the conclusion of the 34^th AGM.

The report of the Independent Auditors along with notes and Schedules are annexed to this Board's Report.

There were no qualifications, reservations or adverse remarks or disclaimers made by Independent Auditors i.e. Tukaram and Co., LLP, Chartered Accountants, Hyderabad, in their report.

b. Internal Auditor

In terms of Section 138 of the Act, and the relevant Rules, the Company re-appointed M/s. Manohar Chowdhry and Associates, Chartered Accountants as Independent Internal Auditors of the Company for a further period of three years. The Internal Auditor directly reports to the Audit Committee.

c. Secretarial Auditor

In terms of Section 204 of the Act, and the Rules made thereunder, M/s. V. Bhaskara Rao and Co., Hyderabad, Practicing Company Secretaries have been appointed as the Secretarial Auditors of the Company for the Financial year 2023-24. The report of the Secretarial Auditor is annexed to this Report. There were no qualifications, reservations or adverse remarks or disclaimers made by the Secretarial Auditors.

d. Annual Secretarial Compliance Report

The Annual Secretarial Compliance Report for the Financial year ended 31^st March, 2024, on compliance of all applicable SEBI Regulations and circulars / guidelines, issued by M/s. V. Bhaskara Rao and Co., Company Secretaries, was submitted to BSE Limited and National Stock Exchange of India Limited.

29. Compliance with Secretarial Standards

The Company complies with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

30. Director's Responsibility Statement

Pursuant to the requirement Section 134(3)(c) of the Act, your Directors confirm that:

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

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

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

d. the directors had prepared the annual accounts on a going concern basis;

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

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

31. Details of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

a. Conservation of Energy

c. Foreign Exchange Earnings and Outgo:

During the year under review, the details of Foreign Exchange Earnings and outgo are as under:

Inflow - Rs 1,749.64 Lakhs Outflow - Rs 6,627.58 Lakhs

32. Public Deposits

During the period, the Company has not accepted any deposit(s) within the meaning of Section 73 & 74 of the Act, read the Companies (Acceptance of Deposits) Rules, 2014.

33. Significant and Material Orders Passed by the Regulators

During the period under review, there have been no significant and material orders passed by the Regulators, Courts, or Tribunals which would impact the going concern of the Company.

34. Particulars of Employees

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of this Report. Disclosures relating to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. Having regard to the provisions of the second proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such information may write to the Company at investors@avantifeeds.com.

35. Disclosure as for Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the Financial year ended 31^st March, 2024, the Company has not received any complaints pertaining to Sexual harassment of Women at the Workplace. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

36. General

Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the year under review:

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

• Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except Employees' Stock Options Schemes referred to in this Report.

• the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

• No instances of frauds reported by Auditors under Section 143(12) of the Act.

• There are no proceeding pending under the Insolvency and Bankruptcy Code, 2016.

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

37. Acknowledgements

Your Directors take this opportunity to express their deep and sincere gratitude and appreciation for co- operation extended by the Governmental Agencies, Shareholders and Banks from time to time. Your Directors also place on record their appreciation for the contributions made by the employees through their dedication, hard work and commitment. Your Directors also convey thanks and appreciation to the valued customers and dealers for their continued patronage.