Garware Marine Industries Ltd

To,

The Members,

Garware Marine Industries Limited

We present our report on the business and operations of the Company for the year ended 31st March, 2024.

Financial Summary: In preparation of the financial statements, the Company has adopted Indian Accounting Standards (IND AS) referred to in Section 133 of the Act. The significant accounting policies which are consistently applied are set out in the notes to the financial statements.

Revenue from operations (including other income) for the year ended 31st March, 2024 stood at Rs. 71.21 lakhs as against Rs. 122.53 lakhs for the previous year ended 31st March, 2023 (lower by 41.81%). There is a loss of Rs. 6.81 Lakhs for the year ended 31st March, as against a profit of Rs. 11.58 lakhs for the previous year in view of a substantial reduction in revenue from operations.

As a result of a increase in market price of listed investments, Other Comprehensive Income stood at a "surplus" of Rs. 320.28 lakhs as opposed to a "deficit" of Rs. 339.85b lakhs for the previous year.

Therefore, the Total Comprehensive Income for the Year stood at a profit of Rs.313.67 Lakhs as against a loss of Rs. 327.72 Lakhs in the previous year. No material changes/commitments have occurred after the financial year ending till date of this report, which affected the financial position of the Company.

During the year under review the Company's revenue was generated from vessel repairs. This was substantially lower than the previous year in view of the fact that the Company's main customers fleet reduced in size and therefore the extent of repairs carried out also reduced.

During the current year, Revenue from operations declined and the Company incurred a loss. In the short term the Company will face challenges since the Company's main customer has reduced the strength of its fleet, as stated above. As a result, the scope to carry our repairs has also reduced. However, the Company has been putting great efforts to increase its Customer base. Additionally since the Company's main Customer Vessels require to undergo statutory dry docking/upgrade during the year, the Company expects to see some improvement in terms of its results.

On a the medium to long term horizon, the Company hopes that better days return to the Offshore Shipping market and its Customers once again expand their fleets, which would translate into more business for the Company. The company is also hopeful of widening its Customer base so that it can generate sufficient revenue to defray all costs and earn a healthy profit.

In view of the current year losses, your Directors regret that they are unable to recommend any dividend for the financial year ended 31st March, 2024.

Subsidiary / Wholly Owned Subsidiary

The Company does not have any Subsidiary or Wholly-owned Subsidiary.

During the year under review, the Company has not granted any loan, not made any investment nor has it given any guarantee u/s 186 of Companies Act, 2013 and thus required details are not applicable.

No Deposits covered under Chapter V of the Companies Act, 2013 were invited by the Company from public during the year under review.

The Directors

The following persons make up the Board of Directors of the Company:

*cased as Independent Director w.e.f. the close of the working hours on 31st March. 2024. **Appointed w.e.f. 27^th March, 2024.

Mr. Piyush V. Patel was appointed as an Independent Director of the Company for a term of five (5) years with effect from 27th March, 2024 by the members as per the Postal Ballot dated 09^th May, 2024. Mr. Patel satisfies the criteria of independence prescribed under the Companies Act, 2013 and SEBI Listing Regulations and he is not debarred from holding the office of Director by virtue of any order passed SEBI or any other such authority.

Due to expiry of the second term of 5 years, Mr. Rajiv S. Khanna ceased as Independent Director of the Company with effect from the close of the working hours of the Company on 31st March, 2024. The Board wishes to place on record its gratitude to Mr. Rajiv S. Khanna for all his support during his tenure as a Director.

In accordance with the Provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Aditya A. Garware (DIN: 000198146), Non-Executive Director retires by rotation at the forthcoming Annual General Meeting of the Company and being eligible offers himself for re-appointment. The Board of Directors recommends his re-appointment for the consideration of the Members of the Company at the ensuing Annual General Meeting of the Company. All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Number of Meetings of the Board

During the year under review, 5 Board Meetings were duly convened and held on 26^th May, 2023, 09^th August, 2023, 09^th November, 2023, 07^th February, 2024 and 27^th March, 2024. The details of the said Board Meetings forms part of the Corporate Governance Report.

Committees of the Board

The Board of Directors has the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders' Relationship Committee

4. Corporate Social Responsibility Committee The details of the committees along with their composition and relevant details are provided in the Corporate Governance Report.

Board Evaluation

Pursuant to Provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, for the purpose of the evaluation of the Board, a structured customized questionnaire was prepared after taking into consideration the various aspects of the Board's functioning, composition of the Board and its Committees, performance of duties, obligations and governance. The performance evaluation of the Chairman, Non-independent Directors and Independent Directors was carried out by all the Directors and the outcome of the same was satisfactory.

Familiarization Program for Independent Directors

From time to time, all the Independent Directors are informed about the status of business of the Company as well as their responsibilities and commitments.

The following are the Key Managerial Personnel of the Company:

Audit Committee

Pursuant to the Provision of Section 177(8) of the Companies Act, 2013, the Audit Committee has 3 members including 2 Independent Directors as follows:

There were no instances where the Board had not accepted any recommendation of the Audit Committee.

Pursuant to Section 178 of the Companies Act, 2013, the Board has set up a Nomination & Remuneration Committee and the details of the Committee are enumerated under Corporate Governance Report Annexed to this Report.

Stakeholders Relationship Committee

Pursuant to Section 178 of the Companies Act, 2013, the Board has set up a Stakeholders Relationship Committee and the details of the Committee are enumerated under Corporate Governance Report Annexed to this Report.

Policy on Appointment and Remuneration

The Board of Directors has framed a Policy which lays down a framework for remuneration to be paid to the Directors, Key Managerial Personnel and Senior Management of the Company. This Policy also lays down the criteria for selection and appointment of Board Members. The details of the Policy are available on the Company's website www. garwaremarine.com.

Director's Responsibility Statement

In accordance with the provisions of Section 134(3) of the Companies Act, 2013 and based on the information provided by the management, your Directors' state that: (a) In the preparation of the Annual Accounts, the applicable accounting standards have been followed and that no material departures (save and except as stated in this Directors' Report, if at all) have been made from the same; (b) They have selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the financial year and of the loss of the

Company for the year ended on that date;

(c) That they have taken proper and sufficient for the maintenance of adequate accounting records in accordance with provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) They have prepared the Annual Accounts on a going concern basis;

(e) They have laid down internal financial controls to be followed and that such financial controls are adequate and were operating effectively;

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.

Statutory Auditors and their Report

As per Section 139 of the Act, read with rules made thereunder, as amended, Messrs. D. Kothary & Co., Chartered Accountants (Firm Registration No. 105335W), was re-appointed as the Statutory Auditors of the Company for the period of 5 years (second term), in the 44^th AGM dated 27^th September, 2022, till the conclusion of 49^th Annual General Meeting.

The Notes to the financial statements referred in the Auditors' Report are self-explanatory. The Auditors' Report is enclosed with the financial statements forming part of this Annual Report. There are no Qualifications in the Auditors' Report.

Registered Office

The Registered Office was shifted from Buildarch Wisteria, Ram Maruti Road, Dadar (West), Mumbai 400028 to 03^rd Floor, Prospect Chambers, D. N. Road, Fort, Mumbai 400001 from 01^st August, 2023.

Annual Return

A copy of Annual Return as provided under Section (3) of Section 92 of the Companies Act, 2013 ("the Act") hosted on the Company's website www. garwaremarine.com/investor.

Personnel

The Board appreciates the support and co-operation of all the employees of the Company, with special mention to be made of the Flying Squad who are responsible for the repair of Vessels.

Internal Financial Control

The Company has adequate internal financial control with respect to the preparation and presentation of the financial statements. There is no material change(s) and comment(s) affecting the financial position of Company which has occurred between the end of the Financial Year of the Company to which the financial statements relate and the date of the Report.

Significant & Material Order by any Court Suit No.01

As a background, the Company had filed an application for setting aside the Ex parte Decree dated 15.06.2012 passed by the Hon'ble High Court of Madras in the matter of Integrated Finance Company Limited (IFCL). The Hon'ble Court was pleased to set aside the Exparte Decree by an Order dated 04.04.2017 upon condition of deposit of Rs 30 lakh with the Court, which the Company has complied with. The Company has thereafter filed its written statement and also filed an application for dismissal of the suit filed by IFCL on the grounds of limitation and also whether the Suit could be considered as a "Commercial Suit".

Prior to deciding on the issue of limitation, the Hon'ble High Court of Madras declined to entertain the disputes between the parties as a "Commercial Suit" as originally argued by IFCL and passed the order in favour of the Company. Thereafter, IFCL preferred an appeal against the same order in the Appellate Bench of the Hon'ble High Court of Madras where they lost once again. IFCL thereafter filed an appeal with the Hon'ble Supreme Court. Upon hearing the matter, the Hon. Supreme Court decided that the matter was a commercial suit and therefore the further hearing/s could be conducted at The High Court of Madras. Accordingly, the matter is now listed in the High Court of Madras, waiting for a date of hearing.

Suit No.02

The Company has also filed a suit for an amount of Rs. 1.93/- cr. together with interest @ 18% against Integrated Finance Company Limited (IFCL) for loss of profit.

The order passed by the Appellate Bench of High Court of Madras in their judgement against the appeal filed by IFCL (as stated above in the second para of Suit No. 01) further stated that since the matter mentioned in Suit No. 02 (the Suit filed by the Company) is interconnected with Suit No. 01 (the Suit filed by IFCL), the suits should by heard jointly, as "civil suits".

Risks and area of concern

Adequate measures have been taken to protect the Company from any potential risks which may affect the existence of the Company and the Board of Directors continuously strives to take utmost care to ensure preservation of interest of all its stakeholders.

Corporate Governance and Management Discussion and Analysis Report

The Corporate Governance Report and Management Discussion and Analysis Report along with the Auditors' Statement of its compliances are given separately.

Related Party Transactions

The information on related party transactions as required under Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is enclosed as Annexure A to this Report. The Policy on Related Party Transactions is available on the Company's website www.garwaremarine.com.

Vide Amendment dated 22nd November, 2021, in its previous Notification dated November 9, 2021,

Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015 (‘LODR Regulations'), in the case of Related Party Transactions of the Company being a "Material Related Party Transaction" Member's approval was taken through Special Resolution in the Company's 44^th AGM dated 22^nd September, 2022. In this regard, a Transaction is considered to be material, if the transaction(s) to be entered into individually or taken together with the previous transactions during the financial year, exceeds Rupees One Thousand Crore or 10% of the annual consolidated turnover of the listed entity as per the last audited financial statement of the listed entity, whichever is lower.

Secretarial Audit

Pursuant to the Provisions of Section 204 of the Companies Act, 2013 and the Rules made thereunder, Mr. Rajkumar R. Tiwari, Practicing Company Secretary (CP No. 2400) has been re-appointed as Secretarial Auditor to conduct Secretarial Audit for the Financial Year 2023-24. The Secretarial Audit Report for the year ended 31st March, 2024 is enclosed as Annexure B to this Report. There are no qualifications in the said report.

During the year under review the Company has complied with the provisions of the Companies Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above.

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

In view of the total shut down of all manufacturing activities, Statement pursuant to provisions of Section 134(3)(m) of the Companies Act, 2013 and Companies (Accounts) Rules, 2014 for Conservation of Energy, Technology absorption and Foreign Exchange Earnings and outgo is not applicable.

Human Resources

The relations with employees continue to be cordial. Your Directors wish to express their appreciation of the services rendered by the devoted employees.

Details of Salary of Employees

The information required under Section 197 of the Companies Act, 2013 read with Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company and Directors is furnished in Annexure C.

Vigil Mechanism

Pursuant to Section 177(9) and (10) of the Companies Act, 2013, and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Company has formulated its Vigil Mechanism, under the Whistle Blower Policy, for its Directors and employees to report genuine concerns. The Whistle Blower Policy of the Company is disclosed on the website of the Company, www. garwaremarine.com During the Financial Year ended 31st March, 2024, no complaint has been received by the Audit Committee from Director(s) or employee(s) of the Company.

Corporate Social Responsibility (CSR)

In view of the provisions of Section 135 of the Companies Act, 2013 and the Rules thereunder, the Company was not required to make any contribution towards CSR and thus the required details are "Not Applicable".

Prevention of Sexual Harassment Policy

The Company has constituted a Committee pursuant to the provisions of ‘The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)' Act, 2013 & Rules thereunder. This Committee has been set up to redress complaints under sexual harassment. All employees (permanent, contract and temporary) are covered under the Policy. During the year under review no complaint was received by the Committee.

Acknowledgement

Your Directors express their sincere gratitude to all the stakeholders of the Company who have stood by and supported the Company

For and on behalf of Board