Tega Industries Ltd

Dear Members,

Your Directors have the pleasure of presenting the 48^th Annual Report together with the Audited Financial Statements of your Company for the financial year ended March 31, 2024.

FINANCIAL SNAPSHOT

( H in Million, unless otherwise stated)

RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS

Your Company operates in two (2) primary segments:

(i) Consumables and (ii) Equipment, serving the global mineral beneficiation, mining, and bulk solids handling industry.

Tega Industries Limited is a leading manufacturer and distributor of specialized ‘critical to operating' and recurring consumable products for the global mineral beneficiation, mining, and bulk solids handling industry, based on sales. The Company offers comprehensive solutions to marquee global clients in the mineral beneficiation, mining, and bulk solids handling industry, through its wide product portfolio.

Tega McNally Minerals Limited (TMML), formerly, McNally Sayaji Engineering Limited, is a 100% wholly owned subsidiary of your Company, TMML was acquired at the end of FY 2023 and operates as an Original Equipment Manufacturer (OEM). It offers comprehensive solutions encompassing the manufacturing and marketing of equipment crucial for crushing, screening, grinding, material handling, and mineral processing. With a robust portfolio featuring 40 equipment types, TMML emerges as a key player in the crushing and beneficiation process within the industry.

During the year under review, your Company expanded its scale resulting in improved operating leverage and substantial margin improvement. We have witnessed robust sales growth across all regions, reflecting the effectiveness of our strategies and the value we provide to our customers. Despite the challenging global macro environment characterized by geopolitical issues in West Asia, Europe, and the Red Sea crisis, currency volatility, and inflationary pressures on raw materials, your Company has managed to deliver significantly improved results. A significant development during the year was the long-term Agreement entered into between your Company's foreign subsidiary and Europe's largest copper mine, for the supply, installation, and management of Tega's products for the mine's mineral processing plant. The Agreement shall span over five years, with an option to extend for another year. It started on January 1, 2024, with an estimated expenditure of H 6,852 Million expected from the mine over the six-year term. This partnership is a big step forward for both parties in the mineral processing sector.

The Financial Year 2023-24 has been a milestone period for your Company, marked by record total revenues of approximately _ 15,149.19 Million and an EBITDA of around _ 3,381.77 Million. Despite navigating a dynamic operating environment, your Company delivered exceptional results, showcasing resilience and adaptability. The Consumables business saw a notable growth of 9.6% over the previous year, reaching revenues of _ 12,905 Million, while the Equipment business achieved revenues of _ 2,060 Million, representing a growth of 12.6% over FY 23 year on year basis (Since your Company consolidated Tega McNally Minerals Limited for five weeks in FY 23, hence full year basis is comparable). Although supply chain challenges persisted, your Company proactively managed them, albeit with some impact on transportation delays and inventory. Without these challenges, your Company revenues could have been even higher, showcasing the Company's potential for further growth. Your Company's commitment to addressing supply chain issues and closely monitoring market movements underscores its dedication to supporting customers. There was a significant increase in the order book by 30% during FY 23-24 reflecting positive momentum and confidence in the Company's offerings. Overall, your Company has not only demonstrated resilience but also positioned itself for continued success in the upcoming financial year.

Your Company's total consolidated Income was _ 15,149.19 Million from _ 12,346.56 Million last year, marking a significant increase. The profit before tax was _ 2,469.73 Million compared to _ 2,360.99 Million in the previous year. After taxes, your Company's net profit amounted to _ 1,938.57 Million, up from _ 1,840.30 Million last year, with a slight variation of _ 98.27 Million this year. Your Company's total assets under management have also grown, reaching _ 18,901.39 Million from _ 16,341.03 Million last year. On standalone basis, total income stood at _ 7,658.20 Million, up from _ 7,400.97 Million last year. The profit before tax increased to _ 1,637.78 Million from _ 1,496.01 Million, and after taxes, the net profit increased to _ 1,265.01 Million from _ 1,138.20 Million last year, with a slight variation of _ 126.81 Million this year. The total assets under management also grew to _ 14,543.67 Million from _ 13,181.51 Million last year. These numbers show your Company's strong financial performance and ability to seize growth opportunities.

The Financial Statements of your Company have been prepared in accordance with the Ind AS and the relevant provisions of the Companies Act, 2013 (hereinafter referred to as the ‘Act') and rules made therein, as applicable, Regulation 33, Regulation 34, and Regulation 48 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘SEBI Listing Regulations, 2015'). Accounting policies have been consistently applied except where a newly issued accounting standard if initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use. Your Company discloses standalone and consolidated unaudited financial results on a quarterly basis, which are subjected to limited review, and standalone and consolidated audited financial results on an annual basis.

DIVIDEND AND ITS DISTRIBUTION POLICY

The Board of Directors have recommended a final dividend of H 2 per equity share i.e., 20% on the Ordinary Shares of the Company of the face value of H 10 (ten) each for the Financial Year ended March 31, 2024, subject to approval of members at the ensuing Annual General Meeting and shall be subject to deduction of income tax at source.

In accordance with Regulation 43A of SEBI Listing Regulations, 2015, a Dividend Distribution Policy has been adopted by your Company, covering, inter alia, the parameters for the declaration of dividend, utilisation of retained earnings, the procedure for dividend declaration, etc. The said Policy is available on the website of your Company at the following web-link: https://www.tegaindustries.com/investors/policies/dividend_distribution_policy.pdf

The dividend payout for the year under review is in accordance with your Company's policy to pay sustainable dividends linked to the long-term growth objectives of your Company to be met by internal cash accruals. Your Company's strong performance on the back of meticulous execution over the years, as reflected in the combination of high growth and profitability, has led to building a strong, debt-free, and liquid Balance Sheet. Our focus is on ensuring a sustainable and profitable financial position. We also understand that our stakeholders expect us to deliver long-term growth riding on a solid strategy and prudent business decisions and are looking for good returns on their investments and dividends.

INTEGRATION OF TEGA MCNALLY MINERALS LIMITED (ERSTWHILE MCNALLY SAYAJI ENGINEERING LIMITED)

In February 2023, your Company made an important strategic move and acquired McNally Sayaji Engineering Limited, an Original Equipment Manufacturer (OEM) for the mining and mineral beneficiation sector, through the Corporate Insolvency Resolution Process (CIRP) process vide the order of the Honorable National Company Law Tribunal (NCLT), Kolkata. With the acquisition, your Company took a decisive step forward to become a comprehensive solutions provider in the global mineral beneficiation, mining, and bulk solids handling industry. This acquisition has enhanced your Company's footprint in India and now we shall offer comprehensive solutions to global clients through a wide synergistic product portfolio.

The integration between the two (2) entities is proceeding as scheduled. Your Company is actively working towards unlocking the full potential of this collaboration to generate value from synergies, which we anticipate will have a positive impact in the future. In addition to implementing various structural changes and strategic initiatives, your Company has rebranded McNally Sayaji Engineering Limited to Tega McNally Minerals Limited (TMML). This new brand name is designed to be more vibrant and to enhance the credibility of TMML's products, assuring quality to consumers about what they can expect. In the first year following the acquisition, your Company prioritized laying a solid foundation rather than achieving immediate operational excellence. Efforts were concentrated on integrating the four manufacturing units into a unified entity, fostering a culture of cohesion among them. Previously, each unit operated autonomously. TMML is now pursuing the centralization of orders at the corporate level rather than at individual units, enabling more efficient resource allocation and manufacturing optimization. There is a concerted focus on bolstering the quality and engineering departments to align with the Company's emphasis on selling engineering products. Overall, the inaugural year was dedicated to establishing the groundwork for future operational excellence and synergy among the manufacturing units. In terms of financial performance, TMML has achieved a revenue of approximately H 206 crores with an EBITDA of around H 20 crores during FY 2023-24. It's worth noting that for FY 2022-23, TMML recorded a revenue of approximately H 183 crores with an adjusted EBITDA of around H 10 crores. These figures reflect our commitment to driving growth and efficiency within the integrated entity.

OPERATIONS

Your Company operates in ten cutting edge manufacturing plants across the world, with seven located in India and three strategically placed in major mining locations including Chile, South Africa, and Australia. Your Company's sales and distribution network spans over 70 countries.

Your Company has adopted Digital Platforms for its various processes across Functions. Industry 4.0 by leveraging digital technology for automated Real Time Monitoring & Control of Processes ensuring Repeatable & Robust Product Quality. This includes Automated Dynamic Planning software which can self-calibrate due to any changing Input/Output condition. Your Company has invested in a Digital Management Information System that has enhanced a granular understanding of its business and prompted data-based decision making. This has strengthened our Operations (Procurement & Manufacturing), Sales, Human Resource and Costing.

Industrial Relations at all units in India as well as all the other units in different Geographies continued to be satisfactory during the year under review.

HUMAN RESOURCES

Your Company's human resource objective is to build the organization as an employer of choice. Your Company seeks to motivate employees to realize the best out of them and align employee goals with the organizational objective, ensuring that employees work happily. With an intent to break the barriers, provide equitable opportunities, your Company has maintained its strong focus on Diversity, Equity, and Inclusion.

During the year under review, in order to build buoyancy in the system and cater to aggressive future growth, Tega People Manager and Tega Future Leader Programs were implemented. Additionally, groundwork has been established for providing continuous and sustained learning opportunities for all employees through the implementation of the new Learning Management System (LMS). Further, various workshops on Gender sensitization, multiple sessions on POSH, launch of the E-module on POSH ensured that there are concrete steps taken for organization wide awareness on the importance of Diversity and Inclusion. HRMS platform was introduced to ensure seamless onboarding experience for all new employees.

Your Company was certified as Great Place to Work (GPTW) both for our India and Australia business. We have witnessed a substantial jump of 10 points in the overall score which has lead GPTW team to write a case study on our transformational journey.

BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

At Tega Industries, ‘Partnership with Practice' embodies our commitment to partner responsibly with all relevant stakeholders throughout the value chain for creating a better future. We think that any company's growth strategy should be illuminated by the Triple Bottom Line, which speaks of economic, social, and environmental sustainability. And by making strides towards a sustainable future, we follow a similar road ourselves. We practice inclusive growth, where we make sure that our progress is reflected in both our internal and external stakeholders' well-being as well as the environment, on which we depend for all our natural resources.

Your Company is one of the top 500 listed entities and accordingly pursuant to Regulation 34(2) of the SEBI Listing Regulations, 2015 it has presented its Business Responsibility and Sustainability Report for the FY 2023-24, in the prescribed format and the same forms an integral part of this report as Annexure - I.

PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTFLOW

The particulars relating to the conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act are given in Annexure – II attached hereto and forms part of this Report.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by your Company, which has been approved by the Board. The Policy is available on the website of your Company at https://www.tegaindustries.com/investors/policies/corporate_socialfiresponsibility_policy.pdf.

Your Company strives to meet its commitment towards the community by committing its resources and energies to social development. The CSR Committee of your Company has formulated a CSR Policy which describes the multiple lines around which the CSR activities of your Company are positioned being education and skills development, social and economic welfare, environmental sustainability and such other activities included in Schedule VII of the Act as may be identified by the CSR Committee from time to time.

Your Company has identified four focus areas of engagement which are as under:

• Health: Affordable solutions for healthcare through improved access, awareness and health seeking behaviour.

• Education: Access to quality education, training and skill enhancement.

• Protection of National Heritage, Art and Culture.

• Rural Transformation: Creating sustainable livelihood solutions, addressing poverty, hunger and malnutrition. Environment: Environmental sustainability, ecological balance, conservation of natural resources.

Your Company strives to meet its commitment towards the community by committing its resources and energies to social development. Your Company spends amount on projects keeping in mind sustainability, impact on the desired recipients and efficacy of implementing agencies. Further, your Company believes in contributions which have a long-term impact on the society at large. Accordingly, during the year under review, your Company made contributions in ongoing projects with an objective of social welfare and development. The unspent amount arising out of these ongoing projects has been transferred by your Company within a period of thirty days from the end of the financial year to a special account opened by your Company in that behalf, and such amount shall be spent by your Company in pursuance of its obligation towards the Corporate Social Responsibility Policy within a period of three financial years from the date of such transfer.

A report on Corporate Social Responsibility (CSR) during the financial year ended March 31, 2024, pursuant to the provisions of clause (o) of sub-section (3) of Section 134 of the Act and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is given as Annexure - III to this Report.

RISK MANAGEMENT

Risk Management at your Company forms an integral part of Management focus. The Risk Management Policy of the Company, which is approved by the Risk Management Committee of the Board (‘RMC') and the Board of Directors, provides the framework of Enterprise Risk Management (‘ERM') by describing mechanisms for the proactive identification and prioritization of risks based on the scanning of the external environment and continuous monitoring of internal risk factors. The ERM framework identifies, evaluates, manages and reports risks arising from the Company's operations and exogenous factors. The Company has deployed both bottom-up and top-down approaches to drive enterprise-wide risk management. The Leadership Team as well as the RMC identifies and assesses long-term, strategic and macro risks for the Company. The RMC oversees the risk management process in the Company. The RMC is chaired by an Independent Director. Further, the Chairman of the RMC briefs the Board at its Meetings about the significant discussions at each of the RMC Meetings. This robust governance structure has also helped in the integration of the ERM with the Company's Strategic Planning Process where emerging risks are used as inputs in such processes. Identified risks are used as one of the key inputs in the strategy and business plans. Considering the volatility, uncertainties and unprecedented challenges involved in the businesses, the risk management has gained more importance over the last few years, and it is imperative to manage and address such challenges effectively. Some of the risks identified are set out in the Management Discussion & Analysis Report which forms part of this Annual Report.

INTERNAL CONTROL SYSTEMS

As per Section 134(5)(e) of the Act, the Directors have an overall responsibility for ensuring that your Company has implemented a robust system and framework of Internal Financial Controls. Your Company has an Internal Financial Controls (‘IFC') framework, commensurate with the size, scale, and complexity of your Company's operations. The Board of Directors of your Company is responsible for ensuring that IFC has been laid down by your Company and that such controls are adequate and operating effectively. The internal control framework has been designed to provide reasonable assurance with respect to recording and providing reliable financial and operational information, complying with applicable laws, safeguarding assets from unauthorized use, executing transactions with proper authorization and ensuring compliance with corporate policies.

Your Company has devised appropriate systems and framework including proper delegation of authority, policies and procedures, effective IT systems aligned to business requirements, risk based internal audits, risk management framework and whistle blower mechanism. Your Company has already developed and implemented a framework for ensuring internal controls over financial reporting. The framework includes entity level policies, process, and operating level controls & policies. The entity level policies include anti-fraud policies (like code of conduct, insider trading policy and whistle blower policy) inter alia others. Your Company has also prepared Risk Control Matrix (RCM) for each of its key processes, like, procure to pay, order to cash, hire to retire, treasury, fixed assets, inventory, manufacturing operations, etc. During the year, controls were tested, and no reportable significant deficiency / material weakness was observed.

The Internal Audit team develops an annual audit plan based on the risk profile of the business activities. The Internal Audit plan is approved by the Audit Committee, which also reviews compliance to the plan. The Internal Audit team monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures, and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action(s) in their respective area(s) and thereby strengthen the controls. Significant audit observations and corrective action(s) thereon are presented to the Audit Committee. The Audit Committee reviews the reports submitted by the Internal Auditors in each of its quarterly meeting.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its subsidiaries for FY 2023-24 are prepared in compliance with the applicable provisions of the Act and as stipulated under Regulation 33 of the SEBI Listing Regulations, 2015 as well as in accordance with the Indian Accounting Standards notified under the Companies (Indian Accounting Standards) Rules, 2015. The Audited Consolidated Financial Statements together with the Auditor's Report thereon form part of this Report. Pursuant to the provisions of Section 136 of the Act, the Financial Statements of the Company, Consolidated Financial Statements along with relevant documents and separate annual accounts in respect of subsidiaries are available on the website of the Company.

SHARE CAPITAL AND CHANGES IN CAPITAL STRUCTURE

The total Authorized Share Capital of your Company is H 1,050 Million divided into 7,00,00,000 equity shares of H 10/- each and 3,50,00,000 preference shares of H 10/- each.

During the year under review, 1,81,380 equity shares of H 10/- each were allotted to the employees pursuant to the exercise of options under the Employee Stock Option Scheme 2011. This resulted in a change in the total paid-up Equity share capital from H 663.54 Million to H 665.35 Million.

Further, during the year under review, the Promoters of the Company divested part of their shareholding through open market sale to achieve the requirement of having Minimum Public Shareholding (MPS) i.e., equity shares of the Company held by public is more than twenty-five per cent. of the total shareholding, in terms of Rule 19(2)(b) and 19(A) of Securities Contracts (Regulation) Rules, 1957, Regulation 38 of SEBI Listing Regulations, 2015 and other relevant circulars.

As on March 31, 2024, the total paid up Equity share capital of your Company is H 665.35 Million divided into 6,65,35,492 equity shares of H 10/- each. The total shareholding of the Promoter(s) of your Company is 74.79% and none of the Promoters/ Promoter Group shareholding is under pledge. Further, in compliance with Regulation 31(2) of SEBI Listing Regulations, 2015, the entire shareholding of promoter(s) is in dematerialized form.

TRANSFER TO GENERAL RESERVES

Your Directors do not propose to transfer any amounts to the general reserves of your Company, instead have recommended to retain the entire amount of profits for the financial year ended March 31, 2024, in the profit and loss account.

Your Company did not have any amounts due or outstanding as at the Balance Sheet date to be credited to the Investor Education and Protection Fund.

EMPLOYEE STOCK OPTION SCHEME - 2011

In view of the regulatory changes with the introduction of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the Members of your Company approved the amendments /modifications in the existing provisions of ‘Employee Stock Option Scheme-2011 ("ESOP–2011") in accordance with the aforesaid regulations vide postal ballot dated April 03, 2022. Your Company received in-principle approval from the Stock Exchanges for the said scheme.

During the year under review, the Nomination and Remuneration Committee of your Company has approved the allotment of 1,81,380 Equity Shares to employees of your Company under ESOP–2011 under various tranches. Your Company received listing and trading approval from the Stock Exchanges for the aforesaid shares.

The objective of ESOP-2011 is to attract, retain and motivate the best available talent by way of rewarding employee stock options for their performance and to motivate them to participate in the growth of your Company, besides creating long term wealth in their hands. Accordingly, Options had been granted from time to time to the eligible employees of your Company.

The details as required to be disclosed under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are available at https://www.tegaindustries.com/AGM/ ESOPdisclosure2024.pdf.

DEPOSITS

Your Company has not accepted any deposits from the public and consequently, there are no outstanding deposits in terms of the Companies (Acceptance of Deposits) Rules, 2014 as on March 31, 2024.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Statement in Form AOC-1 containing the salient features of the financial statement of your Company's subsidiaries and joint ventures pursuant to the first proviso to Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, forms part of the Annual Report. Further, in line with Section 129(3) of the Act read with the aforesaid Rules, SEBI Listing Regulations, 2015 and in accordance with the Companies (Indian Accounting Standards) Rules, 2015 (‘Ind AS Rules') read with Schedule III to the Act, Consolidated Financial Statements prepared by your Company includes the financial information of its subsidiary companies.

A Report on the performance and financial position of each of the subsidiaries included in the Consolidated Financial Statements prepared by your Company as per Rule 8(1) of the Companies (Accounts) Rules, 2014, forms part of the annual accounts of each of the subsidiary companies and forms part of Form AOC-1. The said Report is not repeated here for the sake of brevity. Members interested in obtaining a copy of the annual accounts of the subsidiaries may write to the Company Secretary at the email id compliance.officer@tegaindustries.com.

In accordance with Section 136 of the Act, the audited financial statements, including the consolidated financial statements and related information of your Company and audited accounts of each of its subsidiaries, are available on your Company's website www.tegaindustries.com.

As on March 31, 2024, the Company had eleven (11) subsidiaries (one in India and ten overseas) and one (1) Joint Venture. There has been no material change in the nature of the business of the subsidiaries. During the year under review, Edoctum Peru S.A.C., step down Subsidiary of Tega Industries Chile SpA was dissolved w.e.f. January 20, 2024, and Tega Industries Peru SAC, a Subsidiary of Tega Industries Chile SpA was incorporated w.e.f January 23, 2024.

Your Company has formulated a Policy for determining Material Subsidiaries in accordance with SEBI Listing Regulations, 2015.

The said policy is available on your Company's website at the following link: www.tegaindustries.com/investors/policies/policy_for_determining_material_subsidiaries.pdf.

RELATED PARTY TRANSACTIONS

During the year under review:

a) all contracts / arrangements / transactions entered by your Company with related parties were in its ordinary course of business and on an arm's length basis.

b) there were no material related party transactions which required prior approval of the Members.

c) your Company had not entered into any contract / arrangement / transaction with related parties 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.

d) there were no materially significant related party transactions which could have potential conflict with the interests of your Company at large.

The Policy was amended by the Board during the year, inter alia, in order to bring the existing Policy in alignment with the applicable rules and regulations. The amended Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions is available on your Company's website at following web-link: https://www.tegaindustries.com/investors/policies/policy_onfirelated_partyfitransactions.pdf.

Members may refer to relevant notes of the Standalone Financial Statements which sets out related party disclosures pursuant to Ind AS.

INTER-CORPORATE LOANS AND INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return of your Company is available at www. tegaindustries.com.

CREDIT RATING

The Company has obtained credit ratings for the credit facilities sanctioned to it and the strong ratings ascribed by the Rating Agencies reflect the Company's financial discipline and prudence in management.

As on the date of this report, CRISIL Ratings Limited has upgraded the ratings of the Company as follows:

BOARD MEETINGS

Your Company follows the practice of drawing up an annual calendar for Board and Committee Meetings to ensure the presence of maximum number of Directors in all the Meetings. The primary business of the Board consists of evolving strategy, annual business plans, review of actual performance and course correction, and any other matter as may be deemed fit. The role of the Board also includes structuring, investment, and business re-organization. Matters such as capital expenditure, recruitment of senior level personnel, safety and environment, HR related developments, compliance with status and risk management are also reviewed by the Board from time to time.

Your Company's commitment to good governance practice allows the Board to effectively perform these functions. Your Company ensures that timely and relevant information is made available to all the Directors in order to facilitate their effective participation and contribution during the meetings and discussions.

Eight (8) Board Meetings were held during FY 2023-24, the details of which are given in the Corporate Governance Report attached to this Report. The maximum time gap between any two (2) consecutive meetings did not exceed one hundred twenty (120) days.

COMMITTEES OF THE BOARD

Pursuant to various requirements under the Act and the SEBI Listing Regulations, 2015, the Board of Directors has constituted/ reconstituted (whenever necessitated) various committees such as Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee. During the year under review, there were no instances when the recommendations of the Committees were not accepted by the Board.

Further, two Committees have been constituted by the Board of Directors - (i) Finance & Operations Committee, for operational convenience in handling day to day banking and operations related matters and (ii) Sustainability Committee, to oversee and drive sustainability initiatives within the organization.

The details of composition, terms of reference, etc., pertaining to these committees are mentioned in the Corporate Governance Report.

DIRECTORS

The term of Mr. Syed Yaver Imam (DIN: 00588381) as a Wholetime Director of your Company concludes on May 31, 2024. Further, Mr. Imam was appointed as an Additional Director (Category: Non-Executive Non-Independent) of your Company by the Board of Directors based on the recommendation of the Nomination & Remuneration Committee w.e.f. June 01, 2024, to hold office till the conclusion of this 48^th Annual General Meeting (AGM) in terms of Section 161 of the Act and rules made thereunder.

In accordance with the provisions of Section 152 of the Act and the relevant rules and your Company's Articles of Association, Mr. Madan Mohan Mohanka (DIN: 00049388) retires by rotation at the ensuing AGM and being eligible, offers himself for re-appointment.

The brief resume/details relating to Director(s) who are proposed to be appointed/re-appointed are furnished in the Notice of the ensuing AGM. The Board of Directors of your Company recommends the appointment/re-appointment of the above Directors.

Your Company has received a declaration from each of the Independent Directors under Section 149(7) of the Act and Regulation 25(8) of SEBI Listing Regulations, 2015 that he/she meets the criteria of independence laid down in Section 149(6) of the Act and Regulation 16(1)(b) of SEBI Listing Regulations, 2015 and that he/she is not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact his/her ability to discharge his/her duties with an objective of independent judgement and without any external influence. With regard to integrity, expertise and experience (including the proficiency) of the Independent Director appointed/re-appointed, the Board of Directors are of the opinion that all the Independent Directors are persons of integrity and possess relevant expertise and experience and their continued association as Directors will be of immense benefit and in the best interest of your Company. All requisite declarations were presented before the Board. Further, the Board of Directors, took on record the declaration and confirmation submitted by the Independent Directors under Regulation 25(8) of SEBI Listing Regulations, 2015, after undertaking due assessment of the veracity of the disclosures submitted. Further, at the time of appointment of Independent Directors, a formal letter of appointment is given to the Director, inter alia explaining the role, duties, and responsibilities of the Director. Disclosures w.r.t. Familiarisation programmes for Independent Directors are available on the link: https://www.tegaindustries.com/investors/policies/policy_on_familiarization_programme_for_independent_directors.pdf.

Pursuant to Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2019 (‘the Rules') effective from December 01, 2019, the Independent Directors of your Company have registered themselves with the Databank maintained by the Indian Institute of Corporate Affairs (IICA) and their names presently stands included in the Databank of IICA. The Independent Directors have successfully qualified the Online Proficiency Self-Assessment Test, as may be applicable.

KEY MANAGERIAL PERSONNEL

During the year under review, Mr. Sharad Kumar Khaitan was appointed as the Chief Financial Officer of your Company with effect from July 10, 2023.

Mr. Syed Yaver Imam (DIN: 00588381) shall cease to be a Key Managerial Personnel of your Company with effect from June 01, 2024, post conclusion of his term as a Wholetime Director of your Company on May 31, 2024.

In terms of the provisions of Section 2(51) and Section 203 of the Act, the following are the Key Managerial Personnel of the Company as of March 31, 2024 -

1) Mr. Madan Mohan Mohanka (DIN: 00049388), Chairman & Wholetime Director

2) Mr. Mehul Mohanka (DIN: 00052134), Managing Director and Group CEO

3) Mr. Syed Yaver Imam (DIN: 00588381), Whole time Director

4) Mr. Sharad Kumar Khaitan, Chief Financial Officer

5) Ms. Manjuree Rai, Global Head – Legal & Compliance, Company Secretary & Compliance Officer.

BOARD EVALUATION

Pursuant to the provisions of the Act and Regulation 17 of the SEBI Listing Regulations, 2015, the Board has carried out the evaluation of its own performance and that of its committees as well as evaluation of performance of the individual directors. Further, the Independent Directors at their meeting reviewed the performance and role of non-independent directors and the Board as a whole and Chairperson of your Company. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report attached to this Report.

NOMINATION & REMUNERATION POLICY

The Board of Directors of your Company have adopted a Policy on Selection & Remuneration of Directors, Key Managerial Personnel and other employees based on the recommendation of the Nomination & Remuneration Committee pursuant to the provisions of Section 178(3) of the Act and Regulation 19 of SEBI Listing Regulations, 2015. This policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a director (executive/non-executive) and also the criteria for determining the remuneration of the directors, key managerial personnel (KMPs) and other employees. The Policy may be accessed on the link - https://www.tegaindustries.com/investors/policies/nomination_and_remuneration_policy.pdf.

VIGIL MECHANISM AND WHISTLE BLOWER POLICY

The Company has devised an effective whistleblower mechanism enabling stakeholders, including individual employees and their representative bodies, to communicate their concerns about illegal or unethical practices freely. The Company has also established a vigil mechanism for stakeholders to report concerns about any unethical behavior, actual or suspected fraud or violation of the Company's code of conduct.

Your Company has formulated a codified Whistle-Blower Policy incorporating the provisions relating to Vigil Mechanism in terms of Section 177 of the Act and Regulation 22 of SEBI Listing Regulations, 2015, in order to encourage Directors and Employees of your Company to escalate to the level of the Audit Committee any issue or concerns impacting and compromising with the interest of your Company and its stakeholders in any way. Your Company is committed to adhere to highest possible standards of ethical, moral and legal business conduct and to open communication and to provide necessary safeguards for protection of employees from reprisals or victimisation, for whistle blowing in good faith. The Policy was amended by the Board during the year, inter alia, to include the subsidiaries of the Company in its purview. The amended Policy is available on your Company's website at https://www.tegaindustries.com/images/articles/pdf/Whistle_Blower_Policy.pdf. Further, no complaints were reported under the Vigil Mechanism during the year.

PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

Your Company has a zero tolerance for sexual harassment at workplace and has adopted a policy viz., Policy on Prevention of Sexual Harassment in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (‘POSH Act'). Your Company is also in compliance with the provisions of the POSH Act, with respect to the constitution of Internal Complaints Committee.

During the year, your Company received One (1) complaint of sexual harassment which was disposed off, following the due process as per the laid down policy. The said policy is available on the website of your Company at https://www.tegaindustries.com/images/articles/pdf/POSH_Policy.pdf. To build awareness in this area, the Company has been conducting awareness sessions during induction of new employees and also periodically for permanent employees, third-party employees and contract workmen through online and in person sessions.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

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 your Company. Any member interested in obtaining such information may address their email to compliance.officer@ tegaindustries.com.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes and commitments affecting the financial position of your Company between the end of the financial year i.e. March 31, 2024, and the date of this Report.

CORPORATE GOVERNANCE

In terms of the provisions of Regulation 34(3) of the SEBI Listing Regulations, 2015, the Corporate Governance Report and the Certificate on the compliance of conditions of Corporate Governance forms part of the Annual Report and are given separately as Annexure – IV.

STATUTORY AUDITORS AND THEIR AUDIT REPORT

Pursuant to the applicable provisions of the Act, the members at their 44^th Annual General Meeting (AGM) held on October 20, 2020 appointed M/s. Price Waterhouse & Co Bangalore LLP, Chartered Accountants (Firm Registration No. 007567S/S-200012), as the Statutory Auditors of your Company to hold office from the conclusion of the 44^th AGM until the conclusion of the 49^th AGM of your Company to be held in the year 2025.

The reports given by the Statutory Auditors, M/s. Price Waterhouse & Co Bangalore LLP, Chartered Accountants on the standalone and consolidated financial statements of your Company for the year ended March 31, 2024 forms part of this Annual Report and there is no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Reports.

The Auditors of your Company have not reported any fraud in terms of the second proviso to Section 143(12) of the Act.

COST AUDITORS

As per Section 148 of the Act, your Company is required to have the audit of its cost records conducted by a Cost Accountant in practice. Accordingly, the Board of Directors of your Company has, on the recommendation of the Audit Committee on May 23, 2024, approved the appointment of M/s Mani & Co. as the Cost Auditors of your Company for the Financial Year ended March 31, 2025. As required under the Act, a resolution seeking ratification of the remuneration payable to the Cost Auditors forms part of the Notice convening the ensuing Annual General Meeting for FY 2023-24.

SECRETARIAL AUDITORS

As per Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company is required to have the audit of its secretarial records conducted by a Company Secretary in Practice.

Accordingly, your Company appointed Mrs. Sweety Kapoor, Practising Company Secretary (Membership No. FCS 6410, Certificate of Practice No. 5738) holding a Peer Review Certificate No. 660/2020 as the Secretarial Auditor of your Company for Financial Year 2023-24 to conduct the Secretarial Audit pursuant to Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The Secretarial Audit Report for the financial year ended March 31, 2024, does not contain any qualification, reservation or adverse remark or disclaimer and the same forms part of the Annual Report as Annexure - V.

COMPLIANCE OF SECRETARIAL STANDARDS

The Directors have devised proper systems and processes for complying with the requirements of applicable Secretarial Standards issued by the Institute of Company Secretaries of India and such systems were adequate and operating effectively.

Your Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings and General Meetings.

DIRECTORS' RESPONSIBILITY STATEMENT

The Board of Directors acknowledge the responsibility for ensuring compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Act and Regulation 18 of the SEBI Listing Regulations, 2015 in the preparation of the annual accounts for the year ended March 31, 2024, and state that:

(i) in the preparation of the annual accounts for the financial year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company at the end of the financial year and of the profit of your Company for the year;

(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

(iv) they have prepared the annual accounts for the financial year ended March 31, 2024, on a going concern basis;

(v) they have laid down internal financial controls to be followed by your Company and that such internal financial controls are adequate and are operating effectively;

(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws to your Company and the systems are adequate and operating effectively.

GENERAL DISCLOSURES

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.

There has been no change in the business of your Company.

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

There is no instance of one-time settlement with any Banks/ financial institutions.

No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

ACKNOWLEDGEMENTS

The Directors appreciate the hard work, dedication, and commitment of all its employees including workmen at the plants towards the success of the Company. The Directors also acknowledge the support extended by the Company's Shareholders and would also like to thank the financial institutions, banks, government authorities, customers, vendors and other stakeholders for their continued support and co-operation.

On behalf of the Board of Directors