Chambal Fertilisers & Chemicals Ltd

Dear Members,

Your Board of Directors have pleasure in presenting the 39^th Annual Report on the business and operations of the Company together with audited financial statements for the financial year ended March 31, 2024.

1. Standalone Financial Results

The financial performance of your Company on standalone basis is summarized below:

(Rs. in Crore)

During the financial year 2023-24, the financial results had three reporting segments i.e. own manufactured fertilisers, complex fertilisers and crop protection chemicals & speciality nutrients.

2. Operations

The Company is engaged in manufacture of Urea, and has three urea plants at one location in Gadepan, District Kota (Rajasthan). The Company markets other complex fertilisers such as Di-Ammonium Phosphate (DAP), Muriate of Potash (MOP), NPK fertilisers, Crop Protection Chemicals and Speciality Nutrients. During the year under review, there was less volatility in the price of Natural Gas (feedstock), compared to last year. The urea facilities continued to operate at optimum capacity and energy efficiency levels. The energy efficiency of your Company's urea production facilities continued to be one of the best in the industry. The Company was recognized with the certificate of merit at the National Energy Conservation Award 2023, acknowledging the contribution to energy efficiency and conservation. Your Company had also undertaken various energy saving schemes, which were completed by March 2024, and they are delivering better than expected benefits.

The year under review witnessed muted trading in P&K fertilisers by your Company, which is attributable to headwinds in pricing. However, the Company imported adequate quantity of DAP, NPK and MOP to service the channel and in the overall interest of farmers of the country. Government's support, leading to timely release of subsidy, supported your Company in keeping its working capital deployment under control, during the financial year 2023-24. The Crop Protection Chemicals (CPC) and Speciality Nutrients (SN) business continued to grow strongly and registered double-digit growth during the year under review. During the financial year 2023-24, the Company expended its focus on CPC and SN business and introduced various new products. Your Company also introduced innovative biological products in collaboration with renowned R&D organizations to promote soil health and sustainability. The Company's biological product ‘Uttam Superrhiza', has been named as the winner of the most prestigious Applied Microbiology International Product of the year 2023. Your Company stepped up efforts to establish marketing arrangements with innovator companies from Japan, US, Europe, and Middle East for access to new age CPC and SN products, which is likely to bear fruit in the coming years.

The production of ammonia in the Company is in surplus due to technical reasons and such excess ammonia is sold by the Company in the market. Your Company achieved the highest ever sales of ammonia during the year. However, during this period, the global prices of ammonia were subdued which impacted the domestic market as well.

'Seed to Harvest', a unique program under the marketing initiative of your Company, strengthened the bond with farmers. During the year under review, your Company covered approximately 2,900 villages and 3.50 lakh farmers under the ‘Seed to Harvest' program. More than 65,000 soil samples were collected to support the farmers in improving soil health and enhancing crop productivity. Your Company's farmer outreach initiatives like the monthly ‘Chambal ki Chitthi' which reached out to more than one lakh farmers, channel partners etc. and the WhatsApp BOT hosted over toll-free number connecting more than 12 lakh farmers in 12 campaigns, strengthened the Company's focus on digital media. The ‘Uttam Santulit Poshan Abhiyan' was launched to identify best farmer practices and to promote cost effective and environment friendly alternatives. The program was conducted in 13 states covering more than 40 locations.

Detailed information on the business operations of the Company, the industry in which the Company operates, and other relevant information are given in the Management Discussion and Analysis Report attached as Annexure "A" to this Report.

3. Technical Ammonium Nitrate Plant

Your Company is setting up a Technical Ammonium Nitrate plant at its existing plant site at Gadepan, District Kota (Rajasthan), for manufacture of 2,40,000 MTPA of Technical Ammonium Nitrate (TAN), which also includes a Weak Nitric Acid (WNA) plant with manufacturing capacity of 2,10,000 MTPA (Project). The Company has awarded lumpsum turnkey contract to M/s. Larsen & Toubro Limited for engineering, procurement, construction, and commissioning of the plant, while CASALE, Switzerland is the Process Licensor. All requisite statutory and other approvals for setting up the plant have been obtained. Construction activities are progressing well, and the Project is expected to be commissioned on time.

4. Dividend

The Board of Directors of the Company declared an interim dividend of Rs. 4.50 per equity share of Rs. 10 each i.e. @ 45% (Previous Year - Rs. 4.50 per equity share i.e. @ 45%) during the financial year ended March 31, 2024. The Board of Directors has recommended final dividend of Rs. 3 per equity share of Rs. 10 each i.e. @ 30% (Previous Year - Rs. 3 per equity share i.e. @ 30%) for the financial year 2023-24, which shall be paid after approval of shareholders at their ensuing Annual General Meeting. Total dividend for the financial year 2023-24 on account of interim and final dividend, amounts to Rs. 7.50 per equity share of Rs. 10 each i.e. @ 75% (Previous Year - Rs. 7.50 per equity share i.e. @ 75%) involving total outgo of Rs. 307.49 Crore, subject to tax deducted at source (Previous Year - Rs. 312.16 Crore subject to tax deducted at source).

The Dividend Distribution Policy of the Company is available on the website of the Company and can be accessed at the weblink: https://www.chambalfertilisers.com/pdf/Final-Dividend-Distribution-Policy.pdf. There is no change in this policy during the year under review. The interim and final dividend for the financial year 2023-24 declared/recommended by the Board of Directors are in accordance with the Dividend Distribution Policy of the Company.

5. Consolidated Financial Statements

In pursuance of the provisions of the Companies Act, 2013, rules framed thereunder, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and the applicable accounting standards, the Company has prepared Consolidated Financial Statements. The audited Consolidated Financial Statements alongwith Auditor's Report and the Statement containing salient features of the financial statements of subsidiaries/joint venture (Form AOC - 1) forms part of the Annual Report.

6. Corporate Governance Report and Code of Conduct

The Corporate Governance Report for the financial year 2023-24 is attached as Annexure "B" to this Report. All the Directors of the Company and senior management personnel have confirmed compliance of Code of Conduct and Ethics of the Company. The declaration of Managing Director confirming compliance with the ‘Code of Conduct and Ethics' of the Company is enclosed as Annexure "C" to this Report and Auditor's Certificate regarding compliance with the conditions of Corporate Governance is enclosed as Annexure "D" to this Report.

7. Subsidiaries and Joint Venture

The details of the subsidiaries and joint venture as on March 31, 2024 are given below:

CFCL Ventures Limited (CVL) is a subsidiary of your Company in Cayman Islands. CVL has two step down subsidiaries namely, ISGN Corporation in United States of America and ISG Novasoft Technologies Limited (ISGN, India) in India. There was no business activity in these subsidiaries during the year under review.

Hon'ble National Company Law Tribunal, Bengaluru Bench (NCLT) passed an order on January 24, 2023, confirming reduction of equity share capital of ISGN India. Accordingly, during the year under review, the paid-up equity share capital of ISGN, India has been reduced from Rs. 36,23,07,000 (3,62,30,700 equity shares of Rs. 10 each fully paid up) to Rs. 6,68,07,000 (66,80,700 equity shares of Rs. 10 each fully paid up) pending completion of certain procedural requirements required for reduction of its equity share capital as provided in relevant rules and the order of NCLT.

Chambal Infrastructure Ventures Limited is a wholly owned subsidiary of the Company in India. There was no business activity in this subsidiary during the year under review.

Indo Maroc Phosphore S. A. - IMACID (IMACID) is a joint venture of your Company in Morocco with Tata Chemicals Limited and OCP S.A., Morocco. Each partner has an equal stake i.e. 33.33% in the joint venture. IMACID is engaged in the manufacture of phosphoric acid in Morocco.

The performance of IMACID is summarized below:

Sales Turnover was lower during the financial year 2023-24 due to price variance however, Profit after Tax increased during the same period due to better margins as compared to the previous year. The Company does not have any material subsidiary as per the provisions of the Listing Regulations.

The performance of the subsidiaries of the Company is summarized in Form AOC - 1 attached to the Financial Statements of the Company in pursuance of Section 129 of the Companies Act, 2013. The contribution of subsidiaries and joint venture to the overall performance of the Company is also provided in Note no. 46 to the Consolidated Financial Statements.

The Company shall place the financial statements of subsidiaries on its website in pursuance of Section 136 of the Companies Act, 2013.

No subsidiary, associate or joint venture has been acquired or ceased/ sold / liquidated during the financial year 2023-24.

8. Health, Safety, Environment Protection and Quality

The Company continuously strives to improve the standards of Health, Safety, Security, Environment Protection and Quality of products. The Company has implemented a Health, Safety, Security, Environment & Quality Policy as part of a formal process to achieve the above objective. Brief outline of the Company's initiatives in this regard is, as under:

Your Company gives due importance to health assessment and monitoring of occupational disease of employees and contractor's work force, which is carried out through periodic medical examination and hygiene monitoring at workplace. A well-equipped Occupational Health Center at Gadepan operates round the clock to provide health services to employees and their families, contractor's workforce and villagers in the vicinity of the plant. Well-equipped ambulances are available at Gadepan which also cater to the requirements of villagers in medical emergencies. The Company facilitates employees with specialist doctor consultation at the health center of Gadepan, and basic infrastructure for dental & eye checkup has also been developed. The Primary Health Centre (PHC) close to Gadepan has been equipped with X-ray, ECG, and pathological lab test machines provided by the Company. The Company organizes training and awareness programs on health and hygiene related matters from time to time, through external experts. In addition to this, various health camps and campaigns like pulse polio & swine _u vaccination, blood donation, immunization program for children, etc. are organized periodically. The self-sustainable complex at Gadepan provides a hygienic and healthy environment for the employees and their families, significantly contributing to their overall welfare.

In order to ensure the highest levels of health and safety of employees and contractors, a well-defined health and safety management system is in place in your Company. A robust process safety management system is also in place to ensure safe operation of plants and maintenance of equipment and machinery. In order to cover the safety aspects of maintenance jobs, a cross-functional team comprising members of senior management team review the jobs from safety perspective on daily basis, and ensure that all recommended safety measures are followed to mitigate hazards during execution of the work. Extensive safety training and drills are conducted by internal and external experts, which help the Company to maintain and improve the safety systems. Your Company has also strengthened workplace safety by implementing various safety improvement programs basis learnings gathered from other industries/companies. As recognized globally that major cause of accidents/incidents is human behavior, a system of Behavior Based Safety was implemented in operation as well as maintenance activities.

With a view to promote participation, consultation, and ownership of the work by contractor's associates, number of contractor safety supervisors has been increased for better monitoring and safe execution of the work. Various road safety measures such as pedestrian paths, drain protection, fixed speed monitoring cameras at strategic locations, floor markings, safety signages and other visual management measures have been taken to prevent accidents, as per recommendations of the expert agency. Improvement in the working environment has been achieved by way of provision of fresh air supply system and regular illumination survey.

CCTV surveillance system has been installed in most vulnerable areas, such as loading and unloading of hazardous chemicals, to strengthen safety. "Near-Miss" and "Make-to-Good" reporting systems are also in place and various programs and campaigns are organized to encourage safety awareness and involvement of employees and contractor staff.

As a responsible corporate citizen, a special drive was initiated in collaboration with State Disaster Response Force, Kota, wherein a joint mock drill was organized to check effectiveness of the disaster management plan. Given the nature of its operations, the Company has a well-defined "On-Site Disaster Management Plan" and "Mutual Aid and Response Group" with neighbouring industries, which operates for the mutual benefit of all. In case of fire emergency, the Company provides services to the neighbouring villages.

The accident rate has significantly reduced over the years due to strengthening of the safety management system.

Your Company gives importance to protection of the environment and conservation of natural resources. The Company has established a state-of-the-art Environment Management Cell which hosts a fully functional laboratory with modern testing and monitoring equipments, to ensure all emissions are within permissible limits. The said facility also ensures that the Company complies with the relevant national and local regulations with respect to environment. Continuous Emission Monitoring Systems and Continuous E_uent Quality Monitoring Systems are installed to monitor any deviation in the applicable parameters. There is due focus on optimization of resource usage (including raw materials and water) and reduction of waste generation and emissions to the atmosphere. Hazardous and electronic wastes are disposed of through authorized vendors. Bio-degradable wastes from canteen, guesthouse and campus are utilized for generating bio-gas in Bio-Methanation plant. The Company imparts importance to environmental awareness by way of regular promotional campaigns, training, environment and safety committee meetings and emergency drills. A dense green belt with variety of trees has been developed, and regular plantation is done in the campus to provide a soothing and healthy environment for people working/residing in and around the township. The campus is a habitat to many species of birds. Your Company uses only treated wastewater to maintain the green belt through irrigation network spread all over the complex. Gadepan-III plant is a zero liquid discharge plant, and e_uent from the said plant is treated in reverse osmosis-zero liquid discharge plant and permeate from reverse osmosis-zero liquid discharge plant is used as make up water for cooling towers, which has resulted in lesser intake of fresh water from the river around the campus. During the financial year 2023-24, approximately 85% of the sludge generated from reverse osmosis plant was sent to cement companies for co-processing, instead of dumping in land fill at the site approved by the Rajasthan State Pollution Control Board.

The Company is conscious of its responsibility towards environmental sustainability. The Company has installed roof top solar panels in Gadepan campus having capacity of 1000 KW peak power, as a step towards use of renewable energy, which has resulted in substitution of 15% of grid power utilized in the Gadepan complex during financial year 2023-24. During the financial year 2023-24, the Company has implemented various schemes to reduce energy consumption in the plants. These schemes will result in significant reduction of greenhouse gases emissions and saving of natural resources like Natural Gas and water. ‘Single Use Plastic' is strictly banned in the Gadepan campus as per government guidelines.

Your Company is known for its quality products, and commitment to quality is the core of its existence. The Company has been continuously working towards improvement in product quality through process improvements and technology interventions. The Company has inbuilt highly reliable quality check systems as per the approved norms of applicable laws. The Company has been taking corrective and preventive measures promptly, wherever required in cases of sample analysis deviations, workplace environmental upset incidents, by proper investigation and root cause analysis. Quality is ensured at all stages of manufacturing processes, maintenance, and support services. Urea manufactured by the Company is preferred in its marketing territory due to quality. The Company sources the products marketed by it from reputed manufacturers in India and abroad, and appropriate measures are taken to ensure quality of the products. Customer feedback is collected by way of targeted surveys, and they are given due importance by the Company, as it is one of the most important tool for recognizing the areas of improvement.

9. Corporate Social Responsibility

Embracing the vision of "Investing Today for a Sustainable Tomorrow", your Company has adopted a community centric approach for its Corporate Social Responsibility projects and programmes, which are aligned with broader global goals for sustainable and inclusive development. The Company is investing in the area of Education including Technical and Vocational Education, Rural Development, Healthcare and Sanitation, Employability and Empowerment, Environmental Sustainability, Animal Welfare and Soil Health, and Promotion of Sports.

Highlights of the Corporate Social Responsibility ("CSR") projects and programmes of the Company during the financial year 2023-24, are as under: a) Project Akshar - Pre-Primary & School Education

Your Company has adopted one more Government school during the financial year 2023-24, taking the total number of adopted institutions to 54 Government schools and 47 Aanganwadi centers in Kota and Baran districts of Rajasthan. The education project has supported nearly 10,000 rural students by providing access to science subjects, digital learning, computer education, extra-curricular activities, and sports as an integral part of course curriculum. In order to broaden the project's outreach, 32 Government schools of Haryana, Punjab and Madhya Pradesh were supported by providing dual desks, digital SMART classes, bookshelves, and study material etc. Furthermore, to promote girl child education, assistance was provided to one school in Uttarakhand. Chambal Fertilisers DAV School at Gadepan is run in collaboration with Dayanand Anglo Vedic College Trust & Management Society, wherein majority of students are from nearby villages of plant location.

Your Company facilitated 22 meritorious students to join engineering and medical entrance exams coaching classes from prestigious coaching centers of Kota, while also mandating career counselling in secondary and senior secondary classes to guide them towards career oriented higher education paths.

During the financial year 2023-24, three new Aanganwadi centers and 16 additional rooms in 7 Government schools were constructed in neighbouring villages of plant location. Additionally, renovation work was undertaken in 6 Government Aanganwadi centers and 18 Government schools.

The Government of Rajasthan conferred Bhamashah Award - "Shiksha Vibhushan" to the Company for 5^th consecutive year, for exemplary efforts in the field of education in Kota and Baran districts. b) Project Saksham - Technical and Vocational Education

Upskilling youth for better employment opportunities, especially from underprivileged and marginalized sections of society, is the core of this project. Through adopted 5 Industrial Training Institutes (ITIs) and Government Polytechnic College, skill training programs were offered to the rural youth. During the financial year 2023-24, Government Polytechnic College at Baran obtained a_liation of Diploma in Chemical Engineering branch, while ITI Jhalawar secured a_liation for Solar Technician Trade. As a result, ITIs are now offering 1364 seats annually, compared to 1316 seats last year, and Government Polytechnic College is offering 360 seats annually, compared to 240 seats last year. These new employable trades are expected to create more and better job opportunities for rural youth, consequently enhancing standards of living of their families. To improve the job prospects of youth, the Company offered several certificate courses such as Occupational Health and First Aid, Fire & Safety and Personality Development, to the students at these technical institutes. With focus on academic excellence and practical exposure, around 500 students successfully received placement offers from various good companies during the financial year 2023-24. Your Company actively encourages youth from the nearby community, particularly girls, to acquire new skills through vocational training courses organized in the villages. The project offered short term vocational courses such as advanced tailoring, food processing, beauty services, handicraft making, solar panel assembling, motor driving and plumbing etc. c) Project Saakar - Rural Development

Your Company's comprehensive interventions are designed to uplift the infrastructure facilities of nearby villages of district Kota, Baran and Bundi of Rajasthan. During the financial year 2023-24, focus was given to develop community halls, community common spaces, recreational centers, storm water drain network, entrance gates, cement concrete roads, interlocking tile walkways etc. Streetlights were also installed in 3 villages located near plant location to create a safe environment for the community during night hours. Seven open gym facilities were established by the Company in nearby villages to promote a healthy lifestyle amongst community members. Additionally, few schools were renovated to strengthen infrastructure facilities for quality education. Nearby villages of plant location at Gadepan are being developed under the model village scheme with all basic amenities and infrastructure facilities for the community. The Company also facilitated the community by providing potable drinking water at their doorsteps. d) Project Arogya - Health care and Sanitation

Project Arogya offers easy access to quality healthcare facilities to rural folks in Kota, Baran and Bundi districts of Rajasthan. The adoption of Government Primary Health Center (PHC) Bamori in Kota District increased the healthcare support network to existing four PHCs. Furthermore, with the idea of making these institutions self-sustainable in electricity, solar panels of 20 KW capacity each were installed in the PHCs at Gadepan, Simliya and Kundanpur. As a pro-active measure, healthcare facilities were extended in 26 villages and over 100 academic institutions adopted under your Company's CSR initiatives. These efforts have translated into tangible results, with approximately 1,30,000 individuals accessing OPD services and pathological lab test facilities annually in PHCs and around 70,000 community members receiving benefit from health camps and awareness sessions on health-related topics. Initiatives, such as Women Health Clubs and Health Ambassador programs, promoted active participation of women and students in healthcare activities, wherein around 400 women folk and around 150 students of nearby 26 villages facilitated the community members to adopt a healthy lifestyle. Your Company has also installed 38 Reverse Osmosis and water coolers units in selected schools in Haryana and Punjab to ensure safe drinking water facilities for students. e) Project Pragati - Employability and Empowerment

Your Company has established a state-of-the-art skill center namely "Chambal Fertilisers Skill Institute" near its plant at Gadepan, which is currently offering three vocational courses. During the financial year 2023-24, nearly 150 students passed from this institute and achieved 100% placement across various organizations. The institute also offers mandatory training on personality development, soft skills, computer, and information technology skills and "on-the-job training" to each student. The Company is also extending support to rural women folks to create self-help groups in villages and initiate income generation activities. These women self-help groups focus on making various hand made products under "One Village - One Product" concept to become self-reliant and financially independent. f) Project Bhoomi - Environmental Sustainability, Animal Welfare and Soil Health

"Crop Residue Management" and "Sustainable Agriculture" initiatives of the Company were extended to more than 380 villages of Rajasthan, Haryana, and Punjab during the financial year 2023-24. Project Bhoomi achieved successful milestones, including saving of nearly 3.67 lakh tonnes of Green House Gas emission and prevention of crop residue burning in about 2.38 lakh acre land during the paddy harvesting season in Haryana and Punjab. The initiative successfully reached out to over one lakh small and marginalized farmers during the financial Year 2023-24.

The agriculture development laboratory at Gadepan continues to facilitate farming community to access soil testing services for their farmland. During the financial year 2023-24, approximately 31,500 soil samples were tested, and farm advisory services were extended to the farmers to provide valuable insight on soil health and enable them to take informed decisions for optimized agricultural productivity.

The Company is consistently making efforts to ensure conservation of natural resources, particularly water. Rainwater harvesting structures were established in five schools, while five community ponds were rejuvenated in nearby villages of plant location. Additionally, to promote energy self-sufficiency, solar panels of cumulative 103.50 KW capacity were installed in 29 institutions adopted under CSR initiatives of the Company. g) Promotion of Sports

The Company is focused on creating sports infrastructure facilities in rural academic spaces i.e. schools and technical institutions. Seven sports development centres and one stadium at Sangod were established to promote sportsmanship amongst students and youth. Sports are promoted as an integral part of the curriculum, focusing on development of core strengths of students and encouraging them to participate in sports events at various state and national levels.

Apart from sports events at schools and cluster levels, the Company has organized various sports events such as futsal, mini marathon, cricket league, in rural areas during the financial year 2023-24. Continuous training and support by the Company have encouraged the students to participate in seven state and national level events, making ways for their bright career in sports.

The CSR obligation of your Company in terms of the applicable provisions of the Companies Act, 2013 and Rules made thereunder for the financial year 2023-24, is Rs. 35.16 Crore. Your Company has spent Rs. 35.25 Crore on various CSR projects / programmes during the year under review. The composition and terms of reference of Corporate Social Responsibility Committee are given in the Corporate Governance Report. The Corporate Social Responsibility Policy of the Company is available on the website of the Company at http://www.chambalfertilisers.com/csroverview. The Annual Report on Corporate Social Responsibility (CSR) activities for the financial year 2023-24 (including the details of the development and implementation of the Corporate Social Responsibility Policy) as prescribed under Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as Annexure "F" to this Report.

As on March 31, 2024, the Board of Directors of your Company comprised of eight directors. The Board composition includes a Managing Director and seven Non-Executive Directors, of which four are Independent Directors (including one women independent director). Mr. Gaurav Mathur ceased to be Managing Director and Key Managerial Personnel of the Company w.e.f. July 21, 2023. The Board of Directors at its meeting held on July 20, 2023 appointed Mr. Abhay Baijal as Managing Director for a period of two years i.e. from July 21, 2023 to July 20, 2025, which was approved by the shareholders of the Company at their Annual General Meeting held on September 12, 2023.

The shareholders of the Company at their Annual General Meeting held on September 12, 2023 re-appointed Mr. Vivek Mehra as Independent Director, to hold office for second term of 5 (five) consecutive years from September 18, 2023 to September 17, 2028. The Board of Directors is of the opinion that Mr. Vivek Mehra is a person of integrity. In his long professional career, he has worked in the areas of tax and regulatory aspects of mergers and acquisitions, focusing on cross border investment and transaction structuring. He possesses the requisite expertise and experience for re-appointment as Independent Director. The name of Mr. Vivek Mehra is exempt from the requirement to undertake online pro_ciency self-assessment test conducted by the Indian Institute of Corporate Affairs. Mr. Saroj Kumar Poddar, Chairman retires by rotation at the forthcoming Annual General Meeting, and being eligible, has offered himself for re-appointment. Mr. Saroj Kumar Poddar attained the age of 75 years on September 15, 2020. Pursuant to Regulation 17(1A) of the Listing Regulations, the Board of Directors, on recommendation of Nomination and Remuneration Committee, recommends to the shareholders of the Company, approval for re-appointment of Mr. Saroj Kumar Poddar as Director of the Company, liable to retire by rotation, by way of special resolution. The tenure of Mr. Pradeep Jyoti Banerjee as Independent Director shall come to an end on November 30, 2024. Mr. Pradeep Jyoti Banerjee, being eligible, has offered himself for re-appointment as Independent Director. On recommendation of Nomination and Remuneration Committee, the Board of Directors recommend to the shareholders of the Company, re-appointment of Mr. Pradeep Jyoti Banerjee as Independent Director, to hold office for second term of 5 (five) consecutive years from December 01, 2024 to November 30, 2029.

Mr. Rajveer Singh ceased to be Company Secretary and Key Managerial Personnel from close of business hours on May 5, 2023. On recommendation of Nomination and Remuneration Committee, the Board of Directors appointed Mr. Anuj Jain as Company Secretary and Key Managerial Personnel w.e.f. May 6, 2023, and he relinquished the said offices from close of business hours on November 3, 2023. The Board of Directors, on recommendation of Nomination and Remuneration Committee, appointed Mr. Tridib Kumar Barat as Company Secretary and Key Managerial Personnel w.e.f. November 4, 2023.

All the Independent Directors have submitted declaration that they meet the criteria of independence as provided under Section 149(6) of the Companies Act, 2013, rules framed thereunder and the Listing Regulations. In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, the names of all the Independent Directors of the Company have been included in the data bank maintained by the Indian Institute of Corporate Affairs.

During the financial year 2023-24, Mr. Gaurav Mathur and Mr. Abhay Baijal did not draw any remuneration or commission from the subsidiary companies. Eight meetings of the Board of Directors were held during the financial year 2023-24. Other requisite information on the Directors and Board Meetings is provided in the Corporate Governance Report attached as Annexure "B" to this Report. Certificate of a Company Secretary in practice confirming that none of the Directors on the Board of Directors of the Company have been debarred or disqualified from being appointed or continuing as director of companies by the Securities and Exchange Board of India /Ministry of Corporate Affairs or any such statutory authority, is enclosed as Annexure "E" to this Report.

The Company has internal financial controls commensurate with the size and nature of its business. The Company has policies and procedures in place for ensuring orderly and efficient conduct of its business and operations, including adherence to the Company's policies, safeguarding its assets, prevention and detection of frauds & errors, accuracy & completeness of accounting records and timely preparation of reliable financial information.

The details of the internal control system are also given in the Management Discussion and Analysis Report attached as Annexure "A" to this Report.

In pursuance of the provisions of Section 178 of the Companies Act, 2013 and the Listing Regulations, the Company has formulated the Remuneration Policy. The Remuneration Policy outlines, inter-alia, the appointment criteria & qualification requirements, process for appointment & removal, retirement policy, remuneration structure, etc. of the Directors including Managing Director and Whole Time Director(s), Key Managerial Personnel (‘KMP') and other senior management personnel of the Company. As per the Remuneration Policy of the Company, a person proposed to be appointed as Director, KMP or other senior management personnel should be a person of integrity with high level of ethical standards. In case of appointment as an Independent Director, the person should fulfill the criteria of independence prescribed under the Companies Act, 2013, rules framed thereunder and the Listing Regulations. The Remuneration Policy also contains provisions about the payment of fixed & variable components of remuneration to the Managing Director and Whole Time Director(s) and payment of sitting fee and commission to the Non-Executive Directors, and describes fundamental principles for determination of remuneration of senior management personnel and other employees. There is no change in the Remuneration Policy during the year under review. The Remuneration Policy of the Company is available on the website of the Company at the weblink: http://chambalfertilisers.com/pdf/RemunerationPolicy.pdf.

13. Disclosures under the Companies Act, 2013, Rules thereunder and Secretarial Standards a) Your Company has not issued any shares during the financial year 2023-24.

During the year under review, your Company has bought back 1,55,55,555 fully paid-up equity shares of face value of Rs. 10/- each (representing 3.74% of the paid-up equity share capital of the Company as on March 31, 2023) at a price of Rs. 450/- per equity share for an aggregate consideration of Rs. 700 crore (excluding tax), on proportionate basis through the tender offer route, in accordance with the provisions contained in the Companies Act, 2013 and the rules made thereunder, and the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018. Consequently, the paid-up equity share capital of the Company has been reduced from Rs. 416.21 Crore to Rs. 400.65 Crore with effect from February 13, 2024. b) No significant and material orders have been passed by the regulators or courts or tribunals or statutory and quasi-judicial bodies impacting the going concern status and Company's operations in future. c) All related party transactions entered during the financial year 2023-24, were on arm's length basis and in the ordinary course of business. No material related party transaction (in terms of the Company's Policy on Related Party Transactions) was entered into during the year and no contracts or arrangements were entered during the year with related parties which are required to be disclosed under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2. d) A copy of annual return of the Company is available on the website of the Company at the weblink: http://chambalfertilisers.com/annualreturns/ e) Following information is given in the Corporate Governance Report attached as Annexure "B" to this Report: i) Performance evaluation of the Board of Directors, committees of the Board of Directors, Chairman and individual Directors; ii) Composition of Audit Committee; and iii) Details of establishment of Vigil Mechanism/Whistle Blower Policy. f) The particulars of loans and guarantees given, security provided and investments made, if any, under Section 186 of the Companies Act, 2013 are provided in Notes to the Financial Statements. g) During the financial year 2023-24, the auditor, secretarial auditor and cost auditor have not reported any fraud under Section 143(12) of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014. h) The Company has complied with the applicable Secretarial Standards prescribed under Section 118(10) of the Companies Act, 2013. i) The Company has complied with the provisions relating to the constitution of Internal Complaints Committees under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. j) 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 2023-24 and the date of this Report.

Your Directors hereby state that: a) in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made from the same; b) the Directors 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 as at March 31, 2024 and of the profit of the Company for the year ended March 31, 2024; c) the Directors 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; d) the Directors have prepared the annual accounts on a going concern basis; e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

The Notes to the Financial Statements read with the Auditor's Reports are self-explanatory and therefore do not call for further comments or explanations. There is no qualification, reservation, disclaimer or adverse remark in the Auditor's Reports.

The shareholders of the Company at their Annual General Meeting held on September 13, 2022, had re-appointed M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration Number: 012754N/ N500016) as Auditor, to hold office for the second term of 5 (five) consecutive years from the conclusion of 37^th Annual General Meeting till the conclusion of 42^nd Annual General Meeting.

The requirement of maintenance of cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, is applicable to the Company in respect of production of fertilisers, and accordingly the said accounts and records are made and maintained by the Company. The Board of Directors of the Company has appointed M/s. K.G. Goyal & Associates, Cost Accountants for conducting the audit of cost records of the Company, as applicable, for the financial year ending March 31, 2025. As required under the Companies Act, 2013 and Rules framed thereunder, your Directors are seeking rati_cation from the members of the Company for the remuneration payable to M/s. K.G. Goyal & Associates, Cost Accountants.

The Board of Directors of the Company had appointed M/s. RMG & Associates, Company Secretaries for conducting the secretarial audit of the Company for the financial year 2023-24. The Secretarial Audit Report issued by the aforesaid Secretarial Auditor is attached as Annexure"G" to this Report. There is no qualification, reservation, observation, disclaimer or adverse remark in the Secretarial Audit Report.

Energy conservation is of paramount importance for sustainability of operations, and it also results into saving of natural and financial resources. Your Company consistently makes efforts to operate its manufacturing facilities and allied operations with energy efficiency, and evaluates avenues to use alternate sources of energy, to reduce carbon footprint from time to time. The requisite information with regard to conservation of energy, technology absorption and foreign exchange earnings and outgo in terms of the Companies (Accounts) Rules, 2014 is set out in Annexure "H" attached to this Report.

Your Company has developed and implemented a Risk Management Policy. The Risk Management Committee periodically reviews the risks, finalizes the risk document and monitors various risks, including the risks, if any, which may threaten the existence of the Company. The composition and terms of reference of the Risk Management Committee are given in the Corporate Governance Report. The risk document containing key risks and non-key risks, including way forward for mitigation thereof, as approved by the Risk Management Committee, is periodically reviewed by the Audit Committee and the Board of Directors.

During the year under review, the Company did not accept any deposit from the public under Chapter V of the Companies Act, 2013. There was no public deposit outstanding as at the beginning and end of the financial year 2023-24.

Your Company believes that human resource is important for the growth and sustainability of an organization. The Company always strives to keep its human resource motivated, promotes the culture of entrepreneurship at all levels in the organization and encourages merits and healthy relations. The information required to be disclosed in pursuance of Section 197 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is attached as Annexure "I" to this Report.

The members of the Company had approved the ‘CFCL Employees Stock Option Scheme 2010', as amended from time to time ("ESOS 2010"), for grant of stock options exercisable into not more than 41,62,000 equity shares of face value of Rs. 10/- each to the eligible employees and Whole Time Director(s)/ Managing Director of the Company. Each stock option, when exercised, is converted into one fully paid-up equity share of Rs. 10/- of the Company. The Company did not grant any stock options during the year under review. During the financial year 2023-24, ESOS 2010 was completed, as all the eligible employees had exercised their stock options. For the purpose of ESOS 2010, the Trustee of the CFCL Employees Welfare Trust holds ‘nil' equity shares of the Company as on March 31, 2024 (68,000 equity shares as on March 31, 2023). The Trustee did not exercise voting rights in respect of the aforesaid shares during the financial year 2023-24.

The disclosures required to be made under ESOP Regulations are given on the website of the Company at the weblink: https://www.chambalfertilisers.com/pdf/ESOP-Disclosure-2023-24.pdf. The disclosures in respect of ESOS 2010 are also given in the Notes to the Financial Statements.

In pursuance of the provisions of the Listing Regulations, the Business Responsibility and Sustainability Report for the financial year 2023-24, outlining the initiatives of the Company from environmental, social and governance perspective, forms part of the Annual Report.

The in-house Investor Service Centre of your Company is located at the Corporate Office of the Company at New Delhi which provides prompt and efficient service to the investors. The Company takes various initiatives for investor awareness from time to time, including sending reminders to investors about their unclaimed dividends and shares due for transfer to the Investor Education and Protection Fund. The equity shares of your Company are listed at National Stock Exchange of India Limited and BSE Limited. The Company has paid annual listing fees to these Stock Exchanges for the financial year 2024-25. The members are requested to the refer to general shareholders' information given in Corporate Governance Report attached hereto.

The Board of Directors wish to place on record its appreciation of the support and co- operation extended by all the stakeholders, including the Department of Fertilizers, Government of India, Government of Rajasthan and other State Governments, Financial Institutions & Banks, investors and customers. The Board of Directors also appreciate the utmost commitment, hard work and dedication of the employees at all levels.