BASF India Ltd

Your Directors have pleasure in presenting their Report for the financial year ended March 31, 2024.

Standalone Financial Results

(Rs. in million)

Standalone Financial Performance

The revenue from operations stood at Rs. 1,37,674.8 million as compared to Rs. 136,447.7 million in the previous year. Your Company reported a Profit Before Tax (before exceptional items) of Rs. 7,589.5 million for the year ended March 31, 2024 as compared to Rs. 5,280.9 million in the previous year.

The Agricultural Solutions business of your Company registered good growth in revenues during the year under review as compared to the previous year. The growth in the Agricultural Solutions business was equally propelled by both price and volume, with substantial contribution from Exponus? in Insecticides; Priaxor? in Fungicides and Tynzer? in Herbicides. The improved profitability of the Agricultural Solutions business was mainly on account of significant price realisation and favorable product mix.

The Industrial Solutions segment of your Company comprising of the Dispersions, Resins, Additives & Performance

Chemicals businesses. The revenue of the Dispersions business was marginally impacted due to lower price

realisation; however the business witnessed higher volumes in key products like Acronal? and Styronal?. The margins of the Dispersions business improved mainly due to higher volumes and better prices on account of product mix. In case of the Performance Chemicals business, the revenues were impacted due to challenging market conditions and overall reduction in demand, however, the margins improved due to lower input prices.

The Materials segment of your Company comprising of the Performance Materials & Monomers businesses registered good growth in revenue during the year under review as compared to the previous year. The revenues of the Performance Materials business of the Company were mainly driven by high demand across all its products; led by Cellasto? and Specialty Chemicals offsetting the impact of downward price trend. The margins of the Performance Materials business also improved due to higher revenue and lower fixed cost. The Monomers business of your Company registered growth boosted by sale of new product Aniline Bulk and strong demand for Methylene diphenyl diisocyanate (MDI). Higher revenues and better margins also led to higher profits for the Monomers business.

The Surface Technologies segment of your Company comprises of the Coatings & Catalysts businesses. The revenues of the Company's Coatings business improved marginally due to higher price realisation mainly from owned enterprise manufacturers. The profits of the Coatings business also improved significantly due to better margins. The Catalysts business consisting of Process & Refinery Catalysts, registered strong market driven volume growth, however, the margins were impacted due to higher input costs.

The Nutrition & Care segment of your Company comprises of the Care Chemicals and Nutrition & Health businesses. The revenues of the Care Chemicals business of the Company were mainly impacted due to lower volumes and drop in feedstock prices. However, the margins of the Care Chemicals business improved due to softening of input costs despite lower demand. The revenues of the Nutrition & Health business improved due to higher volume in some of the key products, however squeezed margins led to lower profits.

During the year under review, the revenues of the Chemicals segment of your Company comprising of the Petrochemicals & Intermediates businesses was impacted mainly due to lower price realisation and lower volumes. However, the margins of the Chemicals segment improved due to lower input costs and favourable product mix. Export sales stood at Rs. 3072.7 million during the year under review.

Subsidiary Company

During the year under review i.e., on December 11, 2023, your Company has incorporated BASF India Coatings Private Limited as its wholly owned subsidiary. Your Company does not have any Associate Company or Joint Venture Company as on March 31, 2024.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of Financial Statements of BASF India Coatings Private Limited in the prescribed Form AOC-1 is provided in Annexure i and forming part of this Report. The Financial Statements of the subsidiary company are also available on the Company's website at www.basf.com/in and the same are also available for inspection as per the details mentioned in the Notice of 80th Annual General Meeting. Your Company will also make available these documents upon request by any Member of the Company interested in obtaining the same.

Consolidated Financial Statements

The Annual Audited Consolidated Financial Statements together with the Report of Auditors' thereon forms part of this Annual Report

Transfer of Coatings business to BASF India Coatings Private Limited, 100% Wholly Owned Subsidiary of your Company.

During the year, the Coatings business of your Company was proposed to be transferred to a wholly owned subsidiary; namely BASF India Coatings Private Limited (incorporated on December 11, 2023). The transfer of the said business is proposed to be concluded on going concern and at arm's length basis, for a consideration of Rs. 1,820 million, as determined by an Independent Valuer and approved by the Audit Committee and Board of Directors of the Company. The transfer of business will be subject to necessary adjustments, as may be required, to the consideration on the closing date, by the end of the calendar year 2024, in accordance with the conditions specified in the Business Transfer Agreement. Your Company will receive the final consideration in the form of shares of BASF India Coatings Private Limited, at closing.

Execution of Long-term Power Purchase Agreement for procurement of renewable power to Company's manufacturing site at Mangalore

Your Company has entered into a 25-year long-term Power Purchase Agreement ("PPA") with Clean Renewable Energy KK 2C Private Limited, Special Purpose Vehicle, incorporated by Hero Rooftop Energy Private Limited ("the Developer"), for procurement of 2.7 MW of renewable power to its manufacturing site at Mangalore under the prevailing renewable energy policy of the State of Karnataka, the Electricity Act 2003 and the Rules thereunder ("Applicable Laws").

Further, in order to avail the benefit under Captive Power Generative mechanism to the captive users under the Applicable Laws, your Company will hold atleast 26% equity share capital of Clean Renewable Energy KK 2C Private Limited as required under the Applicable Laws for an amount not exceeding Rs. 15 million.

Your Company has signed a Share Subscription and Shareholder Agreement with Clean Renewable Energy KK 2C Private Limited and Hero Rooftop Energy Private Limited on April 1, 2024. Closing of the transaction is subject to customary conditions precedent including receipt of requisite approvals.

Transfer to Reserves

The Company has not transferred any amount to the Reserves for the financial year ended March 31, 2024.

Share Capital

During the year under review, there has been no change in the share capital of the Company. The authorised share capital of the Company, as on March 31, 2024 is Rs. 715,597,150/-, which is divided into 71,559,715 equity shares of Rs. 10/- each, whereas the issued share capital of the Company comprises of 43,285,640 equity shares of Rs. 10/- each aggregating to Rs. 432,856,400/-.

Dividend

The Board of Directors of your Company have recommended a Dividend of Rs. 15/- per equity share i.e., 150% for the financial year ended March 31, 2024. The Dividend would be paid, subject to the approval of the Members at the forthcoming Annual General Meeting on August 7, 2024.

Further, as per Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the top 1000 listed entities based on market capitalization are required to formulate a Dividend Distribution Policy. Accordingly, your Company has formulated its Dividend Distribution Policy, and the same is available on the Company's website at https://bit.ly/ basfdividenddistributionpolicy.

Changes in Directors

During the year under review, the following changes took place in the Board of Directors of the Company: -

i) Dr. Carola Richter resigned as Director of the Company, with effect from the close of business hours on January 31,2024 to pursue her interest and opportunity outside BASF. The Board of Directors of your Company place on record its sincere appreciation for the valuable contributions made by Dr. Carola Richter during her tenure as the Director of the Company.

ii) The Board of Directors of the Company at its Meeting held on February 12, 2024 appointed Mr. Marcelo Rocha Lu (DIN: 10462274) as the Non-Executive Director of the Company, effective February 12, 2024 to fill-in the casual vacancy caused by the resignation of Dr. Carola Richter. The appointment of Mr. Marcelo Rocha Lu as a Non-Executive Director has been approved by the Members of the Company on May 7, 2024, by way of postal ballot.

Mr. Marcelo Rocha Lu, aged 42 years, studied Foreign Service at the Georgetown University in Washington DC. He joined BASF as a Procurement Manager Raw Materials, BASF SE (Germany) in 2006. Thereafter in 2009, he was appointed as a Staff to BASF SE Board Member in BASF East Asia RFQ Ltd, Hong Kong. In 2011, he was appointed as Director, Business Management Polyamides & Intermediates, BASF East Asia RHQ Ltd., Hong Kong. Later in 2012, he was appointed as Vice President, Business Management Polyamides & Precursors, Asia Pacific, BASF East Asia RHQ Ltd., Hong Kong. Between 2016 and 2021, he acted as the Managing Director, BASF Canada Inc and in 2021, he was appointed as Senior Vice President, Care Chemicals North America, BASF Corporation, Florham Park, USA. He has now been appointed as President, Asia Pacific (excl. Greater China) and has assumed responsibility for the Division South & East Asia, ASEAN & ANZ, BASF South-East Asia Pte. Ltd., Singapore, effective February 1, 2024.

iii) The Board of Directors of the Company at its meeting held on March 27, 2024 took note of the completion of tenure of Mr. Pradip P. Shah, Mr. R. A. Shah and Mr. Arun Bewoor as Independent Directors of the Company on March 31, 2024. The Board of Directors of your Company place on record its sincere appreciation for the valuable contributions made by Mr. Pradip P. Shah, Mr. R. A. Shah and Mr. Arun Bewoor as Independent Directors of the Company. The Board further recognized the association of Mr. R. A. Shah as the longest serving Board Member of your Company since 1968.

iv) Considering Mr. Pradip P. Shah's industry-wide knowledge, diverse skill sets, expertise and based on the recommendation of Nomination & Remuneration Committee, the Board of Directors of the Company at its meeting held on March 27, 2024 considered and appointed Mr. Pradip P. Shah as Non-Executive Non-Independent Director of the Company effective April 1, 2024.

Keeping in view, Mr. Pradip P. Shah's leadership and collaborative approach in connecting the management and Board to deliver strong corporate governance, the Board also approved his continuance as the

Non-Executive Chairman of the Company and his office as Director of the Company will be liable to retire by rotation in accordance with the relevant provisions of the Companies Act, 2013. The Board also recognized that the continued association of Mr. Pradip P. Shah would be of immense benefit to the Company.

Mr. Pradip P. Shah is a Chartered Accountant, Management Accountant and holds MBA from Harvard University. He is also a Cost Accountant. He has served on several expert committees of Central and State Governments and was a Director on the Regional Board of the Reserve Bank of India. He is also on the governing boards of some NGOs and Chambers of Commerce.

The appointment of Mr. Pradip P. Shah (DIN: 00066242) as Non-Executive Non-Independent Director of the Company, effective April 1, 2024 was approved by the Members of the Company by way of Postal Ballot on May 7, 2024.

v) Appointment of new Independent Directors:-

The Nomination and Remuneration Committee of your Company considered the various attributes, in line with the Company's requirements such as industry wide knowledge, sector-specific knowledge, international experience, diversity & inclusivity, cultural-fit, independence, integrity etc., for the identification and selection of the new Independent Director(s) of the Company.

After evaluating proposals of diverse candidates, the Nomination and Remuneration Committee took into consideration that the skills, expertise and competencies possessed by Mr. Bahram Vakil and Ms. Sonia Singh were in line with the desired attributes and Company's requirements. Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors of your Company at its meeting held on March 27, 2024 approved the appointment of Mr. Bahram Vakil (DIN: 00283980) and Ms. Sonia Singh (DIN: 07108778) as Additional Directors in the capacity of Independent Directors of the Company for a term of 5 (five) consecutive years, effective April 1, 2024, till March 31, 2029.

The appointments of Mr. Bahram Vakil and Ms. Sonia Singh as Independent Directors of the Company effective April 1, 2024 for a term of 5 (five) consecutive years was approved by the Members of the Company on May 7, 2024 by way of postal ballot.

Mr. Bahram Vakil holds Master of Law (LLM) from Columbia University, New York, USA and is also the Member of New York State Bar. He is one of the founding partners of AZB & Partners, Indian law firm. Mr. Bahram Vakil specializes in the areas of Restructuring & Insolvency, Banking & Finance, Corporate / Mergers & Acquisitions, Energy, Infrastructure and Microfinance and has also been on several government constituted committees.

Ms. Sonia Singh earned her Post Graduate Diploma in Business Management from Faculty of Management Studies, Delhi, India and holds a Bachelor of Arts degree (Economics). She has rich experience of over 33 years in sales and marketing, from creating new categories, channels, brands to new functions & capabilities. She has worked in Lakme Ltd and Hindustan Unilever Limited and also has overseas experience with companies like Nokia, Pepsi, Friesland Foods, Heineken as a brand consultant and marketing trainer.

vi) Re-appointment of Dr. Ramkumar Dhruva as Non-Executive Director of the Company: -

In accordance with the provisions of Section 152 (6) of the Companies Act, 2013, Dr. Ramkumar Dhruva, Non-Executive Director being eligible, offers himself for re-appointment as Director of the Company at the 80th Annual General Meeting of the Company to be held on August 7, 2024.

As required under the SEBI Listing Regulations, the details of Dr. Ramkumar Dhruva, Non-Executive Director of the Company, seeking re-appointment at the ensuing Annual General Meeting are provided in the Corporate Governance Report, forming part of this Annual Report.

Finance & Accounts

Your Company efficiently managed working capital and generated cash from operations of Rs. 8,072.4 million during the year under review. Your Company had NIL borrowings as at the end of financial year 2023-2024.

Your Company continued to focus on managing cash efficiently and ensured that it had adequate credit lines from Company's bankers. Your Company's debt equity ratio was Nil as at March 31, 2024.

Capital Expenditure

Capital expenditure incurred during the year aggregated to Rs. 977.7 million.

Credit Rating

During the year, CRISIL Ltd re-affirmed the credit rating of ‘CRISIL AAA / Stable' for the long-term debt programme of your Company. The ratings on the Fixed Deposits and Commercial Paper have been re-affirmed at ‘FAAA / Stable' and ‘CRISIL A1+', respectively.

Instruments with these ratings are considered to have the highest degree of safety regarding timely servicing of financial obligations & carry lower credit risk.

Fixed Deposits

During the year, your Company has not invited, accepted, or renewed any fixed deposits from the public and accordingly, there is no principal or interest outstanding in respect thereof.

Management Discussion and Analysis Report

In terms of the SEBI Listing Regulations, the Management Discussion and Analysis Report is appended to this Annual Report.

Corporate Governance

Your Company is committed to maintain the highest standards of Corporate Governance and has complied with the Corporate Governance requirements as per the SEBI Listing Regulations.

A separate report on Corporate Governance as stipulated under the SEBI Listing Regulations along with a Certificate of Compliance from the Statutory Auditors, forms part of this Annual Report.

Corporate Social Responsibility

As required under the provisions of the Companies Act, 2013, the Board of Directors of your Company has constituted a Corporate Social Responsibility (CSR) Committee on April 30, 2013. In view of the changes in the Board of Directors of the Company, the CSR Committee was reconstituted by the Board of Directors at its meeting held on March 27, 2024, effective April 1, 2024.

Presently, Mr. Bahram Vakil (Chairman), Ms. Sonia Singh, Independent Directors and Mr. Anil Choudhary, Manufacturing Head & Whole-time Director are the Members of the CSR Committee. Your Board of Directors placed on record its sincere appreciation to Mr. Arun Bewoor for his invaluable contribution and guidance to the CSR Committee and CSR activities of the Company as Chairman of this Committee till March 31, 2024.

Mr. Manohar Kamath, Director - Legal, General Counsel (India) & Company Secretary of the Company continues to act as the Secretary of the CSR Committee.

The CSR Committee has formulated the CSR Policy and has recommended the activities to be undertaken by the Company as specified under Schedule VII of the Companies Act, 2013.

During the year under review, one meeting of the CSR Committee were held on August 4, 2023 to review and recommend to the Board of Directors, the CSR activities to be undertaken by the Company during the financial year 2023-2024.

Your Company was required to spend an amount of Rs. 119 million (Gross Amount) during the financial year 20232024 towards CSR projects / activities.

The details of the ongoing CSR projects initiated by the Company, are provided in Annexure II of this Report. Business Responsibility & Sustainability Report

Regulation 34(2) of the SEBI Listing Regulations, inter alia, provides that the Annual Report of the top 1000 listed entities based on market capitalization, should mandatorily include a Business Responsibility & Sustainability Report ("BRSR") from financial year 2022-23 onwards.

Although the top 1000 listed entities were mandatorily required to publish BRSR from the financial year 2022-23 onwards, your Company adopted and published the said Report on a voluntary basis during the financial year 2021-2022.

In line with the SEBI listing requirements, your Company has included BRSR as part of this Report for the financial year 2023-24, as Annexure III, describing the initiatives taken by the Company from an environmental, social and governance perspective.

The BRSR for the financial year 2023-2024 has also been hosted on the Company's website, and the same can be accessed at www.basf.com/in

Vigil Mechanism

Your Company has established a Whistle Blower Policy for employees, Directors and third parties to report their genuine concerns, details of which have been given in the Corporate Governance Report annexed to this Report. This policy is available on the Company's website and can be accessed at: https://bit.lv/basfwhistleblowerpolicv.

Directors' Responsibility Statement

Your Directors confirm that:

(i) i n the preparation of the annual standalone and consolidated financial statements, the applicable accounting standards have been followed;

(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 ended March 31, 2024 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 Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) they have prepared the annual standalone and consolidated financial statements on a going concern basis;

(v) t hey have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; and

(vi) t hey have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Information pursuant to Section 134(3)(m) of the Companies Act, 2013 read with sub-rule 3 of Rule 8 of the Companies (Accounts) Rules, 2014, forms part of this Report as Annexure IV.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, your Company has devised a policy containing criteria for evaluating the performance of the Executive, Non-Executive and Independent Directors, Key Managerial Personnel, Board and its Committees based on the recommendation of the Nomination & Remuneration Committee. Feedback was sought by way of a structured questionnaire 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. The manner in which the evaluation has been carried out is explained in the Corporate Governance Report, forming part of this Annual Report.

The Board of Directors of your Company expressed satisfaction about the transparency of disclosures, maintenance of higher governance standards and updation of the Independent Directors on key topics impacting the Company.

Policy on Directors' appointment and remuneration

The policy on Directors' appointment and remuneration including determination of the qualifications, positive attributes, independence of a Director and other matters provided under Section 178(3) of the Companies Act, 2013, forms part of the Nomination & Remuneration Policy of the Company. This policy is available on the Company's website and can be accessed at: https://bit.lv/basfnrc

Statutory Auditors

M/s. Price Waterhouse Chartered Accountants LLP (Registration No. 012754N/N500016), Mumbai were re-appointed as the Statutory Auditors of the Company for the 2nd term of 5 (five) consecutive years i.e., from the conclusion of the Annual General Meeting of the Company held on August 3, 2022 till the conclusion of the Annual General Meeting of the Company to be held in the year 2027.

As BASF SE, Ultimate Holding Company and other BASF Group companies are in discussions with overseas network member firms of PricewaterhouseCoopers International Limited ('PwC Network firms') for providing of certain non-audit services to these companies outside India, M/s Price Waterhouse Chartered Accountants LLP (Registration No. 012754N/N500016), Mumbai have re-assessed their ability to continue as Statutory Auditors of the Company in terms of Standard on Quality Control (SQC) 1 ‘Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements' issued by the Institute of Chartered Accountants of India.

In order to avoid any potential conflict of interest that may arise in future consequent to the aforesaid discussions on non-audit services of BASF SE with PwC Network firms outside India, M/s. Price Waterhouse Chartered Accountants LLP (Registration No. 012754N/N500016), Mumbai has vide letter dated May 10, 2024 expressed their intention to resign as Statutory Auditors of the Company at the forthcoming Annual General Meeting of the Company to be held on August 7, 2024 i.e., after completing the audit of the Standalone and Consolidated Financial Statements of the Company for the financial year ended March 31, 2024 and the limited review of the unaudited standalone and consolidated financial results of the Company for the quarter ending June 30, 2024.

Based on the recommendation of the Audit Committee, the Board of Directors of the Company at its meeting held on May 14, 2024 has recommended to the Members of the Company for their approval at the forthcoming Annual General Meeting, the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (Firm Regn. No. 117366W/W-100018) as the Statutory Auditors of the Company for a period of 5 years i.e., from the conclusion of the ensuing 80th Annual General Meeting of the Company to be held on August 7, 2024 upto the conclusion of the 85th Annual General Meeting to be held in the year 2029.

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (Firm Regn. No. 117366W/W-100018) have confirmed to the Board of Directors of the Company that they are eligible to be appointed as Statutory Auditors at the forthcoming Annual General Meeting for a period of 5 consecutive years and they satisfy the criteria as specified under the provisions of Section 139 and Section 141 of the Companies Act, 2013.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. HSPN & Associates, LLP, Practicing Company Secretaries, Mumbai (COP No. 1483), to conduct the Secretarial Audit of the Company for the financial year 2023-2024 and to furnish their report to the Board. The Secretarial Audit Report dated May 14, 2024 forms part of this Report as Annexure V.

Qualifications / Reservations in the Auditors' Report & Secretarial Audit Report

There are no qualifications / reservations placed by the Statutory Auditors and the Secretarial Auditor in their respective Reports for the financial year ended March 31, 2024.

Compliance with Secretarial Standards

Your Company has duly complied with the applicable Secretarial Standards (‘SS') issued by the Institute of Company Secretaries of India relating to Meetings of the Board and its Committees (‘SS1') and General Meetings (‘SS2'), respectively, during the year under review.

Reporting of Frauds by Auditors

During the year under review, there have been no instances of fraud committed against the Company by its officers or employees, which were required to be reported to the Audit Committee / Board of Directors of the Company, by the Statutory Auditors or the Secretarial Auditor under Section 143(12) of the Companies Act, 2013.

Cost Audit

The Board of Directors, in pursuance of Section 148 of the Companies Act, 2013, have appointed M/s. R. Nanabhoy & Co., Cost Accountants, Mumbai, having Registration No. 000010, for conducting the audit of the cost accounting records maintained by the Company for the financial year 2024-2025. The Cost Auditors have confirmed that their appointment is within the limits of Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified from acting as the Cost Auditors of the Company.

Composition of the Audit Committee

As required by Section 177(8) read with Section 134(3) of the Companies Act, 2013 and the Rules framed thereunder, the composition of the Audit Committee is in line with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations, details of which are provided in the Corporate Governance Report, forming part of this Annual Report.

Effective April 1, 2024, Mr. Bahram Vakil and Ms. Sonia Singh, Independent Directors of the Company have been appointed as the Members of the Audit Committee in place of Mr. R. A. Shah and Mr. Arun Bewoor, who completed their tenure as Independent Directors of the Company on March 31,2024. Your Board of Directors placed on record sincere appreciation to Mr. R. A. Shah and Mr. Arun Bewoor for their invaluable contribution and guidance to the Audit Committee as the Members of this Committee till March 31, 2024.

Related Party Transactions

All related party transactions that were entered into by the Company during the financial year 2023-2024 were on arms' length basis. There are no materially significant related party transactions entered into by the Company with its Promoters, Directors, Key Managerial Personnel or other Related Parties, which may have a potential conflict with the interest of the Company at large.

All related party transactions are placed before the Audit Committee for its approval. Prior omnibus approval of the Audit Committee is obtained for transactions, which are repetitive in nature. A statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis. The policy on Related Party Transactions, as approved by the Board, is available on the Company's website and can be accessed at: https://bit.ly/basfrptpolicy.

Your Directors draw the attention of the Members to Note No. 50 of the Financial Statements, which sets out related party disclosures under the Indian Accounting Standards (IND AS).

Further, the disclosures as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2, form part of this Report, as Annexure VI.

Particulars of loans, guarantees or investments under Section 186 of the Companies Act, 2013

During the financial year 2023-2024, the Company has placed Inter-Corporate Deposits with BASF Catalysts India Private Limited and BASF Chemicals India Private Limited, Affiliates of your Company in India. The details of amount outstanding as of March 31, 2024 was as follows: - BASF Chemicals India Private Limited - Rs. 350 million BASF Catalysts India Private Limited - Rs. 5,100 million

Further, the Members of the Company, by way of Special Resolution passed on May 7, 2024 has increased the overall / aggregate limits of the Company of Inter-Corporate Deposits placed with BASF Group Companies in India from Rs. 7,500 million to Rs. 14,500 million (fungible limits), the details of which are as follows:

- BASF Catalysts India Pvt Ltd: Rs. 14,500 million

- BASF Chemicals India Pvt Ltd: Rs. 4,500 million

- Chemetall India Pvt Ltd: Rs. 1,000 million

- Nunhems India Pvt Ltd: Rs. 1,000 million

- BASF India Coatings Pvt Ltd: Rs. 1,500 million

Your Directors draw the attention of the Members to Note No. 50 of the Financial Statements, which sets out the disclosures under the Indian Accounting Standards (IND AS).

Weblink of Annual Return

The Annual Return of the Company for the financial year ended March 31, 2024 in Form MGT-7 is available on the Company's website and can be updated for F.Y. 2023-2024 at: https://bit.ly/BASFANNUALRETURN2023-24

Particulars of Employees

The particulars of employees required to be furnished pursuant to Section 197(12) of the Companies Act, 2013 read with sub-rules 2 and 3 of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, forms part of this Report as Annexure VII. However, as per the provisions of Section 136 of the Companies Act, 2013, read with sub-rules 2 and 3 of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Annual Report excluding the statement of particulars of employees, is being sent to all the Members of the Company. Any Member interested in obtaining a copy of the said statement may write to the Company Secretary at manohar.kamath@basf.com and / or at the Registered Office address of the Company.

Prevention of Sexual Harassment at the Workplace

Your Company gives prime importance to the dignity and respect of its employees irrespective of their gender or hierarchy and expects responsible conduct and behaviour on the part of employees at all levels. Providing a safe and congenial work environment for all employees is an integral part of the Company's Code of Conduct.

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder, your Company has adopted a Policy for Prevention of Sexual Harassment at Workplace and has constituted an Internal Committee (IC). The names of the IC Members are displayed on the notice board in each office and manufacturing site. All employees as well as contract staff and trainees are covered by this policy. Allegations of sexual harassment reported are expeditiously and discreetly investigated and disciplinary action, if required, is taken in accordance with the policy.

There was no complaint of sexual harassment received during the financial year 2023-2024.

Training programs on prevention of sexual harassment at the workplace are also conducted at regular intervals. During the year under report, your Company conducted awareness programmes on the policy for its employees. Your Company had also rolled out an e-learning module to sensitize & create awareness amongst the employees of the Company on prevention of sexual harassment.

Risk Management

Your Company has in place a mechanism to inform the Board about the risk assessment and minimization procedures and undertakes periodical review of the same to ensure that the risks are identified and controlled by means of a properly defined framework. In the Board's view, there are no material risks, which may threaten the existence of the Company. The Board also reviewed the implications of the recent geo-political crisis and the effects associated thereof on the Company.

Internal Financial Control Systems and their adequacy

Your Company has 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, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. Additional details on Internal Financial Controls and their adequacy are provided in the Management Discussion and Analysis Report, forming part of this Annual Report.

Significant and material orders passed by Regulators or Courts

Certain litigations pending with Regulators or Courts have been disclosed as Contingent Liabilities in Note no. 40 of the Notes to the financial statements for the financial year ended March 31, 2024. There are no significant and material orders passed by the Regulators / Courts, which would impact the going concern status of the Company and its future operations.

Material changes and commitments affecting the financial position of the Company

There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report on account of the ongoing geo-political crisis around the world.

Board Meetings

Seven (7) Board Meetings were held during the financial year 2023-2024 on the following dates:

Declaration of Independence

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and the SEBI Listing Regulations as amended.

Other Disclosures

• The Company has not issued any shares with differential voting rights / sweat equity shares.

• There was no revision in the Audited Financial Statements of the Company for the financial year ended March 31, 2023.

• There has been no change in the nature of business of the Company as on the date of this report.

• There are no proceedings filed against the Company under the Insolvency and Bankruptcy Code, 2016 during the financial year 2023-2024. Your Company has initiated action against few customers under the Insolvency and Bankruptcy Code, 2016.

Disclosures with respect to Unclaimed Suspense Escrow Demat Account

As per the Circulars / guidelines issued by SEBI, after due verification of the investor service requests received from the Shareholders / Claimants, ‘Letters of Confirmation (LOC)' are issued in lieu of physical share certificate(s) by Companies / RTAs. The validity of such LOCs is one hundred twenty (120) days from the date of issuance, within which period the Shareholder / Claimant is required to make a request to the Depository Participant (DP) for dematerialising the shares covered by the LOC. In case the demat request is not submitted within the aforesaid period of one hundred twenty (120) days, the Companies are required to transfer such shares to Suspense Escrow Demat Account (SEDA) of the Company opened for this purpose. Shareholders / Claimants can claim back their shares from SEDA by submitting the required documents to RTA as per SEBI Advisory dated December 30, 2022.

Details of shares transferred to / released from SEDA during the F.Y. 2023-24 are as under:

Merger of TSR Consultants Private Limited, Company's Registrar & Transfer Agent with Link Intime India Private Limited

During the year under review, your Company was informed by Company's Registrar & Transfer Agent that the Hon'ble National Company Law Tribunal, Mumbai Bench has approved the Scheme of Amalgamation and Arrangement between TSR Consultants Private Limited with Link Intime India Private Limited, effective December 22, 2023. Pursuant to the said merger, Link Intime India Private Limited is the Company's Registrar & Share Transfer Agent, effective December 22, 2023.

Employee Relations

Your Directors place on record their sincere appreciation of the contribution made by the employees at all levels to the growth of the Company. Industrial Relations at all our manufacturing sites remained cordial.

Acknowledgments

The Board of Directors take this opportunity to thank BASF SE, Germany and all other stakeholders including customers, suppliers, bankers, business partners / associates, Central and State Governments, regulatory authorities and the society at large for their consistent support and co-operation to the Company. Your Directors thank the Members and Investors for their confidence in the Company.