BPL Ltd

#MDStart#

Management Discussion & Analysis

Dear Members,

As the world continues to recover from the biggest crisis of modern times, the after effects of lingering Covid, supply chain disruptions, an irrational war and volatile commodity and currency rates ensure that crisis-management remains the norm.

Through this, India has demonstrated resilience, quick paced and well executed responses, and an optimistic attitude. The Government has hand-held industries and provided much needed reforms through various policies.

The RBI expects India's economic activity to rebound quite strongly, with a growth projection of7.4%for theFinancial Year 2022-23. India will still be the fastest growing economy in the world this year. Both, fiscal and monetary policy, have lent support to India's growth recovery in Financial Year 2021-22 and this support is expected to continue through Financial Year 2022-23. The Financial Year 2022-23 Union Budget clearly focused on growth, not just for now but also for the medium term with a focus on reviving investment demand. Government Capex has significantly higher multipliers than other forms of spending and would play an important role in substituting and even crowding in private investments in the economy at a time when private sector investment demand is likely to remain subdued. The RBI did cut rates, infused significant liquidity and eased regulatory burden to support the economy and has been guided by inflationary conditions later aimed at control on prices of essentials. RBI is committed to an accommodative stance as long as necessary to sustain growth on a durable basis.

While many challenges continue for the industry, your company is also confident and optimistic about both the Indian economy and business prospects. The BPL brand is well positioned to emerge as a dominant player in the market. Your Company in the recent past has upgraded its manufacturing facilities for better efficiencies and productivity. It has put in processes to serve its customers in a more proactive manner and offer high quality products through digitalization and cost optimization. Your company has, over its 58 years of operations, always focused on enhancing customer experience across all its varied businesses. This single-minded customer centric strategy has created a positive impact on society especially in medical and consumer durable categories. BPL will continue its endeavors to make a sustainable difference in its customer's lives, with affordable and reliable products.

Consumer Durables - Brand Licensing Business

Your company's decision to partner with India's leading retailer, Reliance Retail Limited, has proved to be a step in the right direction. Over 180 models of BPL consumer durables across categories such as LED Televisions, Refrigerators, Air Conditioners, Washing Machines, Small Kitchen Appliances, LED lighting devices, Fans, Geysers and Audio products have been launched. Despite a slow start in the initial months of the last financial year, largely due to COVID lockdowns and the impact of global semi-conductor shortages, the BPL product range was expanded during the festive season. As per market reports for 2021, BPL TVs now command close to 3% market share, out performing many established Indian & International brands in the market. Adequate publicity of the brand across both print and digital media has ensured greater visibility to BPL than competing brands.

Now sold in over 8,000 Reliance Digital and other specialist retail stores, the BPL brand's reach and penetration has been steadily increasing year on year. The growth trajectory is a testament to the strength of the BPL brand and its relevance today.

With the waning of Covid related disruptions, the festive season saw the retail market bounce back and the management is confident that in the coming years, the BPL brand will continue its growth path and delight its customers in every way.

Manufacturing Printed Circuit Board Division

The growth of the domestic Electronic Industry during the last year has been encouraging. Printed Circuit Boards being the fundamental building block in any electronic product, have witnessed a reasonable recovery when compared with the previous two years which were affected by the pandemic. The Indian Government's push for self-reliance, "AatmaNirbhar Bharat Abhiyan" is paving the way for many more electronic industries to invest in manufacturing with the support of Production Linked Incentive scheme (PLI) and Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) provided by the Government. Your management believes that electronics manufacturing in India is set to grow exponentially in the coming years as the world's reliance on China is slowly decreasing. Original Equipment Manufacturers (OEMs) are looking at India to fill this gap.

Compared to the Global Electronic System Design and Manufacture (ESDM) industry that exhibits sub 5% year on year growth trends, the Indian ESDM sector is expected to have one of the highest growth rates until FY 2025-30 representing a Compound Annual Growth Rate (CAGR) of 16.6%. This presents an excellent opportunity to the Indian electronic components manufacturing industry. The component market size, which was US$ 31 Billion in FY 2018-19 is likely to reach US$ 72 Billion by FY 2024-25, growing at a CAGR of 15.1%. (IESA report 2020).

Indian PCB usage in particular, is projected to grow at 30% CAGR over the next few years to reach US $ 7.3 Billion by FY 2024-25 from US$1.8 Billion in FY 2018-19 (ELCINA report 2020).

The Second Wave of Covid-19 and lockdowns enforced in various States coupled with disruption in the supply of electronic parts, demand and supply for Consumer Durables and Appliances dampened the initial 4 months of operations (April '21 to July '21). With the relaxation of lockdown restrictions and the return to normalcy from August '21, demand for BPL PCBs was back on track. Through an expanded customer base and new products segments, PCB sales reached an all-time high of Rs. 4.15 Crs in the month of November 2021. The overall PCB business grew from Rs. 30 Crs in previous year toRs. 36.92 Crs in 2021-22 registering a healthy growth of 23%.

As more and more electronics companies work on reducing the size of gadgets, your company's management believes that the demand for Double Sided and Multi-layer PCBs will fast-track over the next few years and will constitute nearly 78% of the total PCB market in India. Considering this enormous opportunity, your company has plans to invest both in Double Side and Multi-layer PCB production lines in addition to the existing Single Side PCB. Your company will manufacture Double Sided and Multi-Layer PCBs up to 4-6 layers in two phases with a total installed capacity of60,000 Sq.mts. annually.

With the investment in Double and Multilayer PCB manufacture, BPL will move up the value chain where the application and the technology are superior to that of Single Sided PCBs. Accordingly, revenues and margins will see an improvement as compared to the current Single Sided PCB business. Besides, your company has recently been certified by MACE a certification Agency of Maruthi Suzuki India Ltd qualifying your company for supplies to their entire Tier 1 /Tier 2 supply base. This is expected to boost BPL's sales to the Automotive Segment of the market.

As global companies look beyond China for their PCB requirements, we also see an opportunity for exporting PCBs to US, Europe andjapan. Your company is working on plans to get a foothold in these countries.

Your Directors hereby present their report along with the audited standalone and consolidated financial statements for the year ended March 31,2022.

FINANCIAL HIGHLIGHTS

The financial statements of the Company for the year ended March 31st 2022 have been prepared in accordance with IND-AS-110 Schedule III of the Companies Act, 2013 and the audited standalone and consolidated financial statements, are therefore in compliance with IND-AS-110 and the obligations of a listed company stipulated under SEBI (LODR) Regulations, 2015.

For Financial Year 2021-22, your company posted gross revenues ofRs. 49.19 crores. It has also been a turnaround year for BPL wherein it has registered an operating profit ofRs.12.94 crores. Your company's financial performance for the year under review is summarized below:

Note: Bharat Energy Ventures Private Limited (BEVPL) and BPL Power Projects (AP) Private Limited (BPPL) became subsidiariesfrom 23rd March 2022 and there were no revenue/ expenses from this date till 31st March 2022. Therefore, standaloneprofitability is considered as consolidatedprofitability.

DIVIDEND

In order to conserve reserves, your Directors'have not recommended any dividend on equity shares of the Company. A dividend on preference shares has been recommended as per the terms of the issue covered by the approved Scheme of Arrangement.

OUTLOOK

As we enter fiscal 2022-23, we are fortunate that the consumer durables & electronics industry is growing exponentially, and most macroeconomic conditions appear favourable. Your Management believes the company's future is bright and the BPL brand is well poised to emerge a dominant player in the market it serves. During the first quarter of2022-23, the brand has already sold over 50% of the previous year's sales. With the major festive sale season approaching your company's sales performance will more than triple the previous years and earn a minimum revenue of Rs. 10 crores from brand licensing alone.

The Government of India has already rolled out 2 rounds of Production Linked Incentive (PLI) scheme for large electronics manufacturing and this is bound to lead to a further rise in domestic manufacture. Currently, nearly 85% ofPCBsusedby these manufacturers are imported but these are now amongst some of the key components selected for import substitution by them. While demand for Single Sided PCBs continue to grow year on year, the major portion of growth is likely to be from Double Sided and Multi-Layer PCBs.

With focused sales and marketing efforts, your Company today has a strong order book. New opportunities from emerging sectors such as EVs, Drones, Solar Energy etc. are generating new customers for the company. These new customer segments have also helped reduce dependency on traditional business segments such as low cost lighting. Your company has now gained expertise in producing PCBs using special materials such as Polytetrafluoroethylene (PTFE) and has also invested in Hot Air Solder Levelling Machinery to increase capabilities and attract new customers who require such premium finishes for their PCBs. The expected turnover from PCB business is Rs. 50 crores a growth of 36% over the previous year.

CERTIFICATION

Your Company has been certified by Maruti Suzuki India Limited with the Prestigious Maruti Centre for Excellence Certificate (MACE). With this certification, your company is now a Maruti

Suzuki approved supplier, which will increase its business opportunity to supply PCBs to Maruti's Tier 1 and Tier 2 vendors.

Your company continues with its rigorous cost restructuring exercises A /'"'I and efficiency improvements which SHHB f~\V j l_L have resulted in significant savings through continued focus on cost controls, process efficiencies and product innovations that exceed customer expectations in all areas, thereby enabling the company to maintain profitable growth in the current economic scenario.

RISK & CONCERNS

The global electronic industry is currently going through a turbulent phase in the supply of various critical components. The shortage of semi-conductors in particular, since 2020 -21, continues to remain a major stumbling block for the electronics industry, restricting the supplies of electronics despite increasing consumer demand. The recent Ukraine-Russia war has put further pressure on the global economy. Shortages and rising oil prices, along with the Chinese zero-tolerance policy towards Covid, may dampen business in the near term. Your company depends on imports for its major raw materials, hence the weakening of the Indian Rupee will also have a direct impact on the overall cost. The unwillingness of its customers to agree to frequent price hikes is a matter of concern.

An unsecured claimant had obtained an order against the Company from single Bench of the Honorable High Court of Delhi, confirming the order of a Sole Arbitrator. The Company has filed an appeal against the said order with the Division Bench of Honorable High Court of Delhi. The Company is hopeful of getting a favorable order on merit. Hence, no provision is made in the books of accounts for the claim.

The company has taken certain precautions and working prudently to mitigate the risks to bearest minimum. With regards to various contigent liabilities, demands raised by the sales tax, exercise and customs authorities over the years, the company has appealed against these demands and the matters remain pending before various authorities.

The company is confident of getting favourable orders in these matters. However as long as these demands exist, we continue to show the demands as contigent liabilities.

SUBSIDIARY/TOINT VENTURES/ASSOCIATE COMPANIES

Bharat Energy Ventures Private Limited (BEVPL) became a subsidiary of your company on 23rd March, 2022, on account of taking back of the equity shares of BEVPL from Electronic Research Private Limited, pursuant to the agreements executed amongst the companies. With this, your company holds 82.46% of the equity capital of BEVPL. BPL Power Projects (AP) Private Limited (BPPL) is now an indirect subsidiary of your company, since it is a subsidiary of BEVPL. Your company has no associate companies. Disclosures on subsidiaries in Form AOC-1 are annexed to this report.

The company has a joint venture namely Kleer Industries Inc. USA, which is under closure.

The audited accounts of BEVPL and BPPL were consolidated with the company as per Sec 129 of the Companies Act, 2013.

ANNUAL EVALUATION OF THE BOARD. ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The company has, during the year, conducted an evaluation of the Board as a whole, its committees and the Individual Directors including the Independent Directors as stipulated in the Nomination and Remuneration policy adopted by the company. The evaluation was carried out through different evaluation forms which covered among the evaluation of the composition of the Board/Committee, its effectiveness, activities, governance and with respect to the Chairman and the Individual Directors, their participation, integrity, independence, knowledge, impact and influence on the Board.

For the financial year 2021-22, the Independent Director have conducted a meeting through Video conference on 31st March 2022. Performance evaluation criteria are as per the policy available at the web link: http://www.bpllimited.com/ investorrelations/policies/policy-on-board valuation.pdf .valuation.pdf.

SHARE CAPITAL

The paid-up Equity Share Capital of the Company as on 31st March, 2022 stood at Rs.48.90 Crores comprising 4,89,05,903 Equity Shares of Rs.10/- each, fully paid up. There is an increase in the paid up capital of the company by Rs.2,10,850/- on account of allotment of 21,085 equity shares of Rs.10/- each, to the employees who have exercised the options.

The paid-up Preference Share Capital of the Company as on 31st March, 2022 was Rs.169.59 Crores consisting of 1,69,58,682 Redeemable Preference Shares of Rs.100/- each.

The above said preference shares became due to redemption in August 2019. The company is exploring various options available for its redemption as per the provisions of Section 55 of the Companies Act, 2013 and rules framed thereunder.

Majority of preference shares are held by promoter companies and also, the company is in discussions with the banks for an early and amicable settlement.

The Company has not issued any Sweat Equity Shares or granted any Employee Stock Option during the Financial Year 2021-22. The Company has not made any provision of money for the purchase of or subscription for shares in the Company under any Scheme.

The provisions of Rule 4 (4) of Companies (Share Capital and Debentures) Rules, 2014 are not applicable to the company since no Equity Shares have been issued by the Company with differential rights during the Financial Year 2021-22.

TRANSFER TO GENERAL RESERVE

During the year under review, the company has not transferred any amount to General Reserves.

PARTICULARS OF EMPLOYEES. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The ratio of remuneration of each director to the median employee?s remuneration and other details prescribed in Section

197(12) of the Act, read with Rule 5(1) of the companies (Application and Remuneration of Managerial Personnel) Rules,2014, are annexed to this report as Annexure-A"

CREDIT RATING

The company has been rated as below by Brick Works India Pvt Ltd (credit rating agency)

As the current exposure is less than the rating requirements, the company has withdrawn the ratings for the Bank Loan Facilities effective from 4 thjuly 2022.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

Policy on Directors appointment is to follow the criteria as laid down under:

(a) the Companies Act, 2013 (b) BPL Code of Conduct for Board of Directors and Senior Management Personnel (c) the Uniform Listing Agreement with Stock Exchanges and (d) good corporate practices.

Emphasis is given to having on board persons from diverse fields or professions.

Guiding policy on remuneration of Directors, Key Managerial Personnel and Employees of the company is that:

a) Remuneration to Key Managerial Personnel, Senior Executives, Managers, Staff and Workmen is industry-driven and takes into account their performance and relative factors to attract and retain quality talent.

b) For Directors, it is based on the shareholders resolutions, provisions of the Companies Act, 2013 and Rules framed there in, Circulars and Guidelines issued by the Central Government and other authorities, from time to time.

DIRECTORS

The composition of the Board is in the line with the requirements of the act and listing regulations. All the Directors have vast knowledge and experience in their relevant fields and the company has benefited immensely by their presence on the Board.

Skill/expertise/competence of a director as identified by the board which are required in the context of business of the company, are mentioned in the Corporate Governance Report.

a. Change in Directors and Key Managerial Personnel (KMP)

During the year under review, following were the changes in the Directors and KMP of the company:

b. Woman Director

In terms of provisions of Section 149 of the Act and Regulation 17(l)(a) of the listing regulations, the company needs to have atleast one woman director on the board. The Company has Mrs. Anju Chandrasekhar as a non-executive woman director on the board.

c. Director retiring by rotation

Mr. Ajit G Nambiar, Executive Director of the company is liable to retire by rotation in terms of the provision of the act at the ensuing general meeting of the company and being eligible, offers himself for re-appointment. The board has recommended his re-appointment.

As stipulated under 36(3) of the listing regulations, a brief resume of the re-appointee i.e. Mr. Ajit G Nambiar, is given in the notice convening 58th AGM of the company.

d. Declaration of Independence by the Independent Directors

The Company had four independent directors as on 31st March, 2022. Pursuant to Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015, Dr. Chandanjuneja, Mr. Nowrozjal Cama, and Mr. Sabareeshan CK were the Independent Directors of the company as on 31st March, 2022 and have made a declaration to the Company confirming the compliance of the conditions stipulated in the aforesaid section and the said declarations were placed at the board meeting held on 10.05.2022.

The independent directors have registered themselves in the Data Bank. Mrs. Pavitra Presigned as independent director of the company on 4th April, 2022.

e. The Policy on nomination and remuneration of Directors and KMP and Senior Management

The policy on nomination and remuneration sets out the criteria for determining qualification, positive attributes of independent directors KMP and senior management under Section 178(3) of the act and Regulation 19 of listing regulations. The policy on the same is approved and adopted by the board is available on the website of the company.

f. Number of Meetings of Board of Directors

The Board of Directors has met five times and Independent Directors, once during the Financial Year 2021-22 and details of date of meetings are available in the Corporate Governance Report section, which forms part of the annual report.

g. Details of Committees of Directors

Composition of Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee and Corporate Social Responsibility Committee; number of meetings of each committee held during the financial year 2021-22 and meetings attended by each member of the committee as required under the Companies Act, 2013 are provided in Corporate Governance Report section which forms part of the annual report.

i. Key Managerial Personnel

Mr. Ajit G. Nambiar is the Chairman & Managing Director of the company. Mr. TLM Rangachar, Chief Financial Officer (CFO) and Mrs. Deepika N Bhandiwad, Company Secretary & Compliance Officer are the Key Managerial personnel of the Company pursuant to Section 203 of the Companies Act, 2013.

a. Statutory Auditors

M/s. MKUK & Associates, Chartered Accountants, are the Auditors of the Company for five consecutive years from the FY2017-18.

The board has duly examined the statutory auditors report to the annual accounts for the financial year 2021-22 which is self-explanatory. Clarifications, wherever necessary, have been included in the notes to accounts. Further the directors confirm that, the qualifications are addressed and attached as addendum to this report.

The term of M/s. MKUK & Associates, Chartered Accountants, expires at the forthcoming Annual General Meeting. However, they have expressed willingness to continue as Statutory Auditors of the company for a further term of 5 years. Accordingly, they have provided confirmations about their availability and consent to act as auditors.

b. Secretarial Auditor

Pursuant to the provisions of Section 204 read with Section 134(3) of the Companies Act, 2013, your company has appointed Mr. Madhwesh K, a Practicing Company Secretary (CP -10897) as Secretarial Auditor of the Company for the Financial Year 2021-22 and the Secretarial Audit Report is annexed herewith and forms part of the report. The explanations of the Board on every qualification, reservation or adverse remark or disclaimer made by the Auditor in his report (Form MR- 3) have been furnished by way of an addendum.

c. Internal Auditor

Pursuant to the provisions of Section 138(1) read with Rule 13 of the Companies (Accounts) Rules, 2014, M/s T Velupillai & Co, Chartered Accountants, are appointed as internal auditors of the company.

d. Cost Auditors

The Company's business during the year under review was not covered under the Cost Audit Rules nor had the Government notified the company to appoint a cost auditor for the said period.

CHANGE IN THE NATURE OF BUSINESS. IF ANY

The company has licensed the " BPL" brand to Reliance Retail Limited for trading electronic and consumer durable goods during the financial year 2020-21. As per the terms of the agreement, Reliance will trade 'BPL' branded products across its own stores, its distribution networks and its own online platform.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and company's operations in the future.

INTERNAL CONTROL AND THEIR ADEQUACY

Your Company has adequate internal financial control systems and checks, which ensure that all assets are safeguarded and that all transactions are recorded and reported properly.

The Internal Financial Control Systems are supplemented by an extensive programme of internal audit conducted by external qualified Chartered Accountants. The Company has also put in place effective Budgetary Systems.

REPORTING OF FRAUDS

There was no instance of fraud during the year under review, which required the statutory auditors to report to the Audit Committee and/or to the Board as required under Section 143(12) of the Companies Act, 2013 and the rules framed thereunder.

RISK MANAGEMENT

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company. The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

CORPORATE SOCIAL RESPONSIBILITY (CSR!

The past year was a particularly challenging one for humanity, with the impact of the COVID-19 pandemic that was felt by all but more so by the vulnerable and marginalized groups on whom the impact has been the hardest. Apart from contributing to the Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund, the BPL Group swiftly responded to the pandemic by putting into action a series of initiatives to manufacture and distribute medical equipment required for the management of Covid, among the urban poor communities.

Your Company also supported the CHERYSH TRUST with the objective of building and supporting resilient communities. You will be happy to know that, through this initiative, your Company has continued to support the constituencies of women, youth and farmers through projects in the domains of education, health and the environment.

The Company has constituted Corporate Social Responsibility Committee which is comprised of three members, out of which, one is an Independent Director. The Committee was set up to formulate and monitor the CSR Policy. The Company's average net profit/loss for last 3 years computed as per the provisions of Section 135(5) of the Companies Act, 2013, was Rs. (3,85,57,357).

Disclosures on CSR Activities as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 are as tabled below:

WHISTLE BLOWER/VIGIL MECHANISM POLICY

The Company has put in place a Whistle Blower/ Vigil Mechanism Policy to provide for an open and transparent working environment and to promote responsible and secure whistle blowing system for directors and employees of the company to raise any concern. The policy broadly covers instances of unethical behaviour, actual or suspected fraud or violation of the company's code of conduct, alteration of documents, fraudulent financial reporting, misappropriation/ misuse of company's assets, manipulation of company's data, pilferage of proprietary information, abuse of authority etc. The policy provides safeguards against victimization of Director(s)/ employee(s) who raise the concern and provide access to the Chairman of the Audit Committee who is entrusted to oversee the whistle blower mechanism. The policy is available on the website of the company.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS

The details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The particulars of every contract or arrangement entered into by the Company with related parties referred to in Sub-section (1) of Section 188 of the Companies Act, 2013 including certain arm's length transactions under third proviso thereto are disclosed in Form AOC- 2, which forms part of the annual report.

MATERIAL CHANGES AND COMMITMENTS

The impact of the Covid-19 pandemic during this financial year resulted in loss of business to the company. The impact of the same is covered in this report.

CORPORATE GOVERNANCE

Your Company is in compliance with all the applicable provisions of Corporate Governance as stipulated under Chapter IV of the Listing Regulations,2015. A separate section on compliance with the conditions of Corporate Governance and certificate from the Statutory Auditors of the Company - M/s MKUK & Associates, Chartered Accountants, in this regard, forms part of the Annual Report. The Managing Director and Chief Financial Officer have certified to the board with regard to the financial statements and other matters as specified in the listing regulations.

SEXUAL HARASSMENT POLICY

The Company has in place a Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, aiming at prevention of harassment of employees and lays down the guidelines for identification, reporting and prevention of sexual harassment. A Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.

During the year under review, there were no complaints pertaining to sexual harassment.

DEPOSITS

During the financial year under review, the company has not accepted any deposits from public and hence, the provisions of the Companies Act, 2013 and rules framed thereunder, are not applicable to the Company.

EXTRACT OF ANNUAL RETURN

As per the requirements of Section 92(3) of the Act and rules framed thereunder, an extract of Annual Return in the prescribed format is displayed on the Company's website: www.bpllimited.com under the head "Investor Relations".

SAFETY. HEALTH AND ENVIRONMENT

Safety Committees at the manufacturing unit are functioning properly to ensure a safe and healthy work environment.

Safety, Health and Environmental requirements as per rules have been adhered to at all the units. Shop in-charge personnel and all security staff have been given sufficient on the job training in the use of safety equipment. Necessary consent(s) have been obtained from pollution control Board with respect to Water and Air. Fire Fighting equipment and water hydrant system are installed inside the factory for safety of all personnel and to meet any eventuality.

The Company has 115 employees as on March 31,2022.

EMPLOYEE STOCK OPTION PLAN

Of the 2,09,054 option grants to 11 employees, 4 employees have exercised 58,789 options till now under ESOP scheme.

The information to be disclosed as per SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 and Rule 12 of Companies (Share Capital and Debentures) Rules, 2014 is annexed to this Report.

OTHER DISCLOSURES

• During the year under review, the company has not allotted equity shares with differential voting rights

• The company has complied with the applicable Secretarial Standards for Board and General Meetings held during the year under review.

• The company has not revised the financial statements as mentioned under Section 131 of the Act.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134 (5) of the Companies Act, 2013, and on the basis of explanations and compliance certificates given by the executives of the company and subject to disclosures in the annual accounts and also on the basis of discussions with the statutory auditors of the company, from time to time, we state as under:

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

b) that the Directors had 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 the company at the end of the financial year and of the profit of the company ended as on that date;

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

d) that the Directors had prepared the annual accounts on a going concern basis.

e) that the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively and

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

CONSERVATION OF ENERGY. TECHNOLOGY. ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO.

Information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134(3) (m) of CA 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is provided below:

a) Conservation of Energy:

Though not a large-scale user of energy, your Company continues to explore several measures to conserve scarce resources and protect the environment.

These include water recycling, waste recycling, solder fumes control and power factor improvement. During the year under review, in view of working capital constraints, your company has not made any capital investment on energy conservation equipment.

b) Technology Absorption:

Electronics technology is changing rapidly and continuous efforts are required to keep pace with it. However, due to financial and manpower constraints, your company has not been able to invest in R & D during the year under review. It is hoped that with improvement in top line and bottom line in the coming year, your company will be able to focus on this important area.

c) Foreign Exchange earnings and outgo: During the period under review, your Company utilized foreign exchange worth Rs. 1983.65 Lakhs and foreign exchange earning was nil.

MD & CFO CERTIFICATION

As required by Regulation 17 (8) of the SEBI (LODR) Regulations, 2015, the Managing Director and CFO certificate for the year under review was placed before the Board of Directors of the company at its meeting held on 30th May, 2022. A copy of said certificate forms a part of the Corporate Governance Report.

COSTRECORDS

The company is not required to maintain cost records under the provisions of Section 148(1) oftheAct.

SECRETARIAL STANDARDS OF ICSI

The Company complies with all applicable mandatory Secretarial Standards as issued by the Institute of Company Secretaries of India.

LISTING WITH STOCK EXCHANGES

The Equity shares of the company are listed on National Stock Exchange of India Limited and BSE Limited. The Annual Listing fees for the Financial Year 2022-23 have been paid to these exchanges.

DIRECTORS & OFFICERS INSURANCE POLICY

The Company has in place an insurance policy for its Directors & Officers with a quantum and coverage as approved by the Board.

The policy complies with requirements of Regulation 25(10) of SEBI (LODR) Regulations, 2015.

MANAGEMENT DISCUSSION & ANALYSIS

Your Directors have covered the Management Discussion & Analysis as required under the Corporate Governance requirements, as a part of the Boards' Report at appropriate places to avoid duplication and overlapping of the contents of the said two reports.

OTHER STATUTORY DISCLOSURES

Your Directors state that no disclosure or reporting is required with respect to the following items as there were no transactions related to these items during the year under review,

1. Issue of equity with differential rights to dividend voting otherwise.

2. Issue of sweat equity shares

3. Provision of money for purchase of its own shares by employees or by trustees for the benefit of employees.

4. Application made or any proceeding pending under Insovency and Bankcruptcy Code, 2016 during the year along with their status as at the end of the financial year.

5. Difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons there of.

6. Receipt of any remuneration or commission by the Managing Director of the company from its subsidiary company.

ACKNOWLEDGEMENTS

The Board wishes to record its appreciation of the continued support and hard work of the employees at all levels. The Board also acknowledges continued co-operation received from Dealers, Suppliers, Customers, Banks, Government Departments, Financial Institutions, Channel Partners and Shareholders.

a) Explanations to the qualifications/adverse remarks of the Secretarial Auditor

i) Point No.(i)-Filing of Annual Performance Report with RBI.

Management Response

The Company's overseas joint venture - M/s.Kleer Industries Inc, USA has been in-operative for a long period. The Company is in the process of closure of this joint venture and submitting requisite application with RBI in this regard.

b) Explanations to the qualified opinion of the Statutory Auditor

i) The company has not redeemed preference shares amounting to Rs. 16958.68 lacs, which had fully fallen due for redemption in August 2019.

Management Response

Preference Shares have become due as per the terms on which they were issued and have not yet been redeemed. Pursuant to the provisions of Section 55 of the Companies Act, 2013, Preference Shares can be redeemed only out of profits that are otherwise available for dividend. Though the Company has earned profit, it is inadequate for the said redemption. The Company is exploring possible methods for redemption of Preference Shares at an early date.

2. The Company has not contributed a sum of Rs.250.93 lakhs towards Group Gratuity Policy maintained with LIC as required under Payment of Gratuity Act.

Management Response

Due to paucity of funds, the Company was unable to make contribution towards Gratuity Fund. The company is making necessary arrangements to fund the same in instalments, over a period.

ii. Consolidated Financials

1. Going concern issue of BPL Power Projects (AP) Private Limited (BPPL)

The financial statements of a subsidiary - BPL Power Projects (AP) Private Limited which is consolidated with the company are prepared based on going concern assumption, considering various factors.

Management Response

BPL Power Projects (AP) Private Limited is one of the subsidiaries of the company. The company has underlying assets which are available to the company. BPPL is yet to commence the commercial operations. Hence, the management is of the opinion that company is a going concern.