Hindustan Foods Ltd

TO THE MEMBERS OF HINDUSTAN FOODS LIMITED

Your Directors are pleased to present Your Company's 39th (Thirty-Ninth) Annual Report on the business and operations, together with the Audited Financial Statements (Consolidated and Standalone) for the Financial Year ended March 31, 2024.

(Rs. In Lakhs)

Your Company did not transfer any amounts to the General Reserve during the Year.

YEAR IN RETROSPECT

Your Company delivered yet again the record operational performance, in-line with your Board's expectations and guidance.DuringtheFinancialYear2023-24,yourCompany not only further strengthened its existing businesses and customers but also acquired the new facilities and diversifying the product base into the newer areas which will help your Company to continue the growth journey ahead. During the year under review the consolidated revenues were marginally higher by around 6% compared to the previous year and your Company reported jump in the consolidated Profit After Tax ('PAT') of 31% compared to the previous year. The year under review has delivered a strong growth despite global challenges. Your Company reported a consolidated turnover of Rs. 2,761.88 Crores as compared to Rs. 2,602.64 Crores during the previous year and recorded the jump in the consolidated PAT of Rs. 93.02 Crores for the year under review as against Rs. 71.12 Crores in the previous year.

During the year under review, your Company has set up a Wholly-Owned Subsidiary Company, HFL Multiproducts Private Limited (‘HMPL') to undertake the beverages project in Guwahati, Assam. To fund this project, your Company has provided an additional loan to HMPL. Your Directors are pleased to inform that HMPL has ramped up its plant and has made its first commercial production in Q4 of FY 2023-24 and also reported its maiden turnover of Rs. 157.91 Lakhs. Your Directors are further pleased to inform that HMPL reported its maiden PAT at Rs. 18.36 Lakhs. Your Directors are confident that HMPL will continue in building the consolidated revenues of your Company for the coming Financial Years.

Your Directors are further pleased to inform that, your Company's another Wholly-Owned Subsidiary Company namely, HFL Consumer Products Private Limited (‘HCPPL') has reported total revenue of Rs. 15,019.46 Lakhs from operations for the year ended March 31, 2024 and incurred a net loss of Rs. 117.17 Lakhs due to capex investments and other expenses incurred during the year under review. Your Directors expects to add more growth in Company's consolidated profits in the coming Financial Year.

Your Directors are also pleased to inform you that, your Company's acquisition of Aero Care Personal Products LLP (‘ACPPL') enabled the Company to enter into the field of manufacturing of Colour Cosmetics and ACPPL had achieved its highest ever turnover in the Financial Year 2023-24 of Rs. 12,216.26 Lakhs and also reported highest ever PAT at Rs.731.22 Lakhs. Your Company expects to add more growth in your Company's consolidated income by ACPPL in FY 2024-25.

HFL Healthcare and Wellness Private Limited (‘HHWPL') continues to be the material Wholly-Owned Subsidiary Company of your Company and is into the business of OTC healthcare and wellness products. Your Directors are pleased to inform that, HHWPL reported a jump in its turnover at 7,280.21 Lakhs compared to the previous year's turnover of Rs. 5,949.49 Lakhs and reported the PAT of Rs. 884.23 Lakhs against Rs. 295.66 Lakhs in the previous period. Your Directors are confident that this acquisition will add significant growth to your company and expand its business into OTC healthcare and wellness globally.

During the year under review, your Company has also successfully completed the acquisition of KNS Shoetech Private Limited (‘KNS Shoetech') on October 23, 2023, pursuant to the Share Purchase Agreement (‘SPA') which was executed on October 23, 2023 between the Shareholders of the KNS Shoetech and your Company. KNS Shoetech is engaged in the business of manufacturing and supply of Sports Shoes and sneakers. KNS Shoetech became a Wholly - Owned Subsidiary Company of your Company with e_ect from November 03, 2023. The acquisition of the Shares of KNS Shoetech is in line with your Company's strategy to enter Contract Manufacturing and expansion of its business into Sport Shoes, Sneakers. Your Directors are further pleased to inform that, during the year under review the KNS Shoetech acquired the business undertaking situated at Kundli, Haryana from KNS Trading Private Limited on February 03, 2024. Further KNS Shoetech also acquired 3 Business undertaking Units from SSIPL Retail Limited, two units situated at Bangran and Bhagani at

Himachal Pradesh and one unit situated at Kundli, Haryana, these units are engaged in the manufacturing of shoes and open footwear including all their Components thereof.

Your Directors are pleased to inform that, the KNS Shoetech recorded a turnover of Rs. 2,718.76 Lakhs and reported the PAT of Rs. 69.95 Lakhs, from the date it became Wholly - Owned Subsidiary Company of your Company upto March 31, 2024. Your Directors are confident that this acquisition will add significant growth to your Company and expand its business into contract manufacturing of the Sports Shoes and Sneakers globally.

During the year under review, your Company successfully completed the acquisition of the manufacturing facility of Reckitt Benckiser Healthcare India Private Limited situated at Baddi, Himachal Pradesh on December 16, 2023. The said facility is into manufacturing of a vast variety of OTC healthcare and wellness products and Skin Care including some of Reckitt's key products. The acquisition also provides your Company an opportunity to leverage idle capacity for better utilization and incremental profits on consolidated basis.

Your Board is confident that Customers will look at your Company's track record of executing Greenfield and brownfield projects flawlessly and integrating the acquisitions seamlessly and continue to propel us towards our committed goal of achieving the target of Rs. 4,000 Lakhs of turnover by FY 2024-25.

SHARE CAPITAL

CHANGE IN CAPITAL STRUCTURE

Your Company's Authorised Share Capital as on the date of this report is Rs. 55,15,22,530/- (Rupees Fifty Five Crores Fifteen Lakhs Twenty Two Thousand Five Hundred and Thirty Only) divided into 26,57,61,265 (Twenty Six Crores Fifty Seven Lakhs Sixty One Thousand Two Hundred and Sixty Five) Equity Shares of Rs. 2/- (Rupees Two Only) each and 2,00,000 (Two Lakhs) 9% Redeemable Non-Convertible Preference Shares of Rs. 100/- (Rupees One Hundred Only) each.

During the year under review, your Board of Directors had allotted 72,71,081 Convertible Warrants of the Company, on preferential basis to non-promoter category on

December 20, 2023, out of which 56,75,054 Convertible Warrants at a price of Rs. 546.25/- each (including face value of Rs. 2/- each at a premium of Rs. 544.25/- each) to certain Qualified Institutional Buyers and 15,96,027 Convertible Warrants at a price of Rs. 563.90/- each (including face value of Rs. 2/- each at a premium of Rs. 561.90/- each) to certain Non-Qualified Institutional Buyers. The tenure of these warrants is for 18 months from the date of its allotment.

Out of which, one of the Warrants holder named Sixth Sense India Opportunities III had exercised their option for the conversion of 18,30,663 (Eighteen Lakhs Thirty Thousand Six Hundred Sixty Three) Warrants into equivalent number of Equity Shares having face value of Rs. 2/- (Rupees Two Only) each of the Company and upon receipt of an amount aggregating to Rs. 74,99,99,748/- (Rupees Seventy Four Crores Ninety-Nine Lakhs Ninety-Nine Thousand Seven Hundred Forty Eight Only), being 75% of the balance amount on the said Warrants, the Share Allotment Committee of Board of Directors of your Company at their Meeting held on February 02, 2024, had allotted 18,30,663 Equity Shares having face value of Rs. 2/- (Rupees two Only) each at a premium of Rs. 544.25/- per shares to Sixth Sense India Opportunities III.

As at March 31, 2024, 54,40,418 convertible warrants are outstanding for conversion into Equity Shares.

The Issued, Subscribed and Paid-up Share Capital of Your Company as on the date of this report after Conversion of Convertible Warrants into Equity Shares stands increased from existing Rs. 24,14,85,380/- (Rupees Twenty Four Crores Fourteen Lakhs Eighty Five Thousand Three Hundred Eighty Only) divided into 11,27,42,690 (Eleven Crores Twenty Seven Lakhs Forty Two Thousand Six Hundred and Ninety) Equity Shares of Rs. 2/- (Rupees Two Only) each and 1,60,000 (One Lakh Sixty Thousand) 9% Redeemable Non-Convertible Preference Shares of Rs. 100/- (Rupees One Hundred Only) each to Rs. 24,51,46,706/- (Rupees Twenty-Four Crores Fifty One Lakhs Forty-Six Thousand Seven Hundred Six Only) divided into 11,45,73,353 (Eleven Crores Forty-Five Lakhs Seventy-Three Thousand Three Hundred Fifty Three) Equity Shares of Rs. 2/- (Rupees Two Only) each and 1,60,000 (One Lakh Sixty Thousand)

9% Redeemable Non-Convertible Preference Shares of Rs. 100/- (Rupees One Hundred Only) each.

Your Company has not issued any Shares with di_erential voting rights or by way of Rights issue or Sweat Equity Shares or Shares under ESOP. Further, it has not provided any money to its employees for purchase of its own Shares hence your Company has nothing to report in respect of Rule 4(4), Rule 12(9) and Rule 16 of the Companies (Share Capital & Debentures) Rules, 2014.

Other / Debt Securities

Your Company has not issued any Debentures during the year under review. No other debt securities had been issued by your Company during the year.

MERGERS AND ACQUISITIONS

During the year under review, your Company has completed the acquisition of 100% Issued, Subscribed and Paid-up Equity Share Capital of KNS Shoetech Private Limited ("KNS Shoetech") on November 03, 2023 for cash consideration of Rs. 3,71,76,320/- (Rupees Three Crores Seventy One Lakhs Seventy-Six Thousand Three Hundred and Twenty Only). This acquisition was made pursuant to the Share Purchase Agreement which was executed on October 23, 2023 between the Shareholders of the KNS Shoetech and your Company. KNS Shoetech is engaged in the business of manufacturing the entire portfolio of sports shoes and sneakers and open footwear including all their Components thereof.

Post completion of the transaction, KNS Shoetech became a wholly - Owned Subsidiary Company of your Company with e_ect from November 03, 2023.

Your Company has also completed the acquisition of manufacturing facility of Reckitt Benckiser Healthcare India Private Limited ("Reckitt") situated at Baddi, Himachal Pradesh, on December 16, 2023, for a cash consideration of 127.75 Crores (Rupees One Hundred Twenty Seven Crore and Seventy Five Lakhs Only) as per the terms and conditions of the Business Transfer Agreement ("BTA") executed on dated December 15, 2022 including amendments thereof entered between your Company and Reckitt.

This acquisition marks an entry of your Company into the segment of manufacturing and expansion of its business into various Pharmaceutical and Non-Pharmaceutical products and vast variety of OTC health and wellness products and skin creams.

KNS Shoetech, a Wholly Owned Subsidiary Company of your Company has completed the acquisition of Manufacturing facility situated at Kundli, Haryana with KNS Trading Private Limited ("KTPL"), on dated February 03, 2024, for cash consideration of Rs. 31.08 Crores (Rupees Thirty-One Crores Eight Lakhs Only), as per the terms and conditions of the BTA executed on dated December 29, 2023 between the KNS Shoetech and KTPL.

Further, KNS Shoetech has also entered into another BTA with SSIPL Retail Limited ("SSIPL") and its promoter, for acquisition of two manufacturing facilities of SSIPL situated at Paonta Sahib, Himachal Pradesh and one manufacturing facility situated at Kundli, Haryana, which are engaged in manufacturing of Shoes and open footwear including all their Components thereof on a slump sale and going concern basis as per conditions set out in the said BTA.

DIVIDEND

To conserve resources and in order to strengthen the Company's financials, your Directors do not recommend any Dividend for the year under review.

DIVIDEND DISTRIBUTION POLICY

In accordance with Regulation 43A of the SEBI Listing Regulations, the top 1000 listed entities based on Market Capitalisation are required to formulate a Dividend Distribution Policy, accordingly your Board has formulated and adopted the Policy. Your Company's Dividend Distribution Policy is based on the parameters laid down by SEBI Listing Regulations, and the details of the same are available on your Company's website at www.hindustanfoodslimited.com.

LISTING INFORMATION

Your Company's Equity Shares are listed on BSE Limited (‘BSE') and also e_ective June 06, 2023 listed on National Stock Exchange of India Limited (‘NSE'). The applicable listing fees for Financial Year 2024-25 have been paid to the Stock Exchanges before the due dates. The Equity Shares of your Company were not suspended from trading on BSE and NSE at any point of time during the year under review.

DEPOSITORY SYSTEM

Your Company's Equity Shares are available for dematerialisation through National Securities Depository Limited (‘NSDL') and Central Depository Services (India) Limited (‘CDSL'). As on March 31, 2024, 97.69% of the Equity Shares of your Company were held in Demat form.

ACCREDITATIONS

YourCompanycontinuestoenjoyfollowingaccreditations:-

1. FSSC 22000 – Food Safety System Certification

2. ISO 9001:2015 - Quality Management System

3. ISO 14001:2015 – Environment Management System

4. ISO 45001: 2018 – Occupational Health & Safety Management System

5. ISO 13485:2016 – Medical Devices- Quality Management Systems

6. BRC GS - Global Standard for Consumer Products Personal Care and Household

7. MHRA – Medical & Health Regulatory Authority certification.

PUBLIC DEPOSITS

Your Company has not accepted any deposits from public / Members falling under the ambit of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 during the year under review. Your Company does not have any unpaid/ unclaimed deposits as on March 31, 2024.

SUBSIDIARIES, ASSOCIATES, JOINT VENTURE COMPANIES AND PARTNERSHIP FIRMS / LLP

HFL Consumer Products Private Limited (‘HCPPL') continues to be the Wholly Owned Subsidiary of your Company as on date of this report. HCPPL is into the Business for Contract Manufacturing of Ice-Cream.

Your Company continues to hold 81% Partnership interest in Aero Care Personal Products LLP ("ACPPL") as on date of this report and ACPPL is into the Business of manufacturing and trade of Cosmetics, Personal Care and Toiletries Products.

HFL Healthcare and Wellness Private Limited (‘HHWPL') (Formerly known as Reckitt Benckiser Scholl India Private Limited) e_ective July 01, 2022, continues to be a Wholly-Owned Subsidiary of your Company as on date of this report. HHWPL is into the business of manufacturing and supplying of footcare products and also engaged in the business of OTC healthcare and wellness segment as a Contract Manufacturer.

Further, during the year under review, due to change in the management, ownership of HHWPL and to align and identify with the name starting with your Company's name (‘HFL'), the name of "Reckitt Benckiser Scholl India Private Limited" (‘RBSIPL') was changed to "HFL Healthcare and Wellness Private Limited" (‘HHWPL') w.e.f. May 10, 2023. There is no other change in the objects of the HHWPL, the HHWPL continues to do the same business as it does. HHWPL continues to be a Material Subsidiary of your Company.

HFL Multiproducts Private Limited (‘HMPL'), incorporated on June 23, 2023 under the Companies Act, 2013 is a Wholly Owned Subsidiary of your Company and has successfully commercialised the manufacturing plant in Assam for food & beverages Sector for a branded Company and has started its maiden operation during the year under review.

During the year under review, KNS Shoetech Private Limited has become a Wholly-Owned Subsidiary of your Company with e_ect from November 03, 2023 after acquisition of 100% Issued, Subscribed & Paid-up Capital by your Company. KNS Shoetech is into the business of manufacturing the entire portfolio of sports shoes and sneakers and open footwear including all their Components thereof.

Your Company monitors the performance of its Subsidiary Companies, inter alia, Financial Statements, in particular investments made by Subsidiary Companies, are reviewed quarterly by your Company's Audit Committee.

Minutes of the Board Meetings of Subsidiary Companies are placed before your Company's Board regularly. A statement containing all significant transactions and arrangements entered into by Subsidiary Companies are placed before your Board. Presentations are made to your Board on business performance of major Subsidiaries of your Company by the Senior Management.

In terms of the Company's Policy on determining "Material Subsidiary", HHWPL was determined as a Material Subsidiary of your Company whose Net worth exceeds 10% of the consolidated income of the Company in the immediately preceding Financial Year, with e_ect from May 18, 2023 and still continues to be a Material Subsidiary Company of your Company. Your Company's Policy for determining Material Subsidiary is available on the Company's Website www.hindustanfoodslimited.com.

CONSOLIDATED FINANCIAL STATEMENTS

As stipulated by the Regulation 33 of the Listing Regulations, the Consolidated Financial Statements have been prepared by your Company in accordance with the applicable Accounting Standards. The Audited Consolidated Financial Statements, together with Auditors' Report, forms part of the Annual Report.

Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the Financial Statements of each Subsidiaries, Joint Venture and joint operations in the prescribed Form AOC-1 forms part of the Financial Statements to this Report.

Pursuant to Section 136 of the Companies Act, 2013, the Financial Statements of the Subsidiary and Associate Companies are kept for inspection upon request made by the Shareholders at the Registered O_ce of your Company. The statements are also available on the Company's website www.hindustanfoodslimited.com.

CREDIT RATING

During the year under review, India Ratings and Research (Ind-Ra) has re-a_rmed the Long-Term Issuer Rating to ‘IND A+/ Stable' of your Company. The outlook is Positive.

DIRECTORS' RESPONSIBILTY STATEMENT

To the best of our knowledge and belief and based on the information and representations received from the operating management, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

(a) that in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures;

(b) that such accounting policies as mentioned in Notes to the annual accounts have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the profit of the Company for the year ended on that date;

(c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) that the annual accounts have been prepared on a going concern basis;

(e) that proper internal financial controls are in place and that the internal financial controls are adequate and are operating effectively;

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

DIRECTORS

RE-APPOINTMENT OF AND REMUNERATION PAYABLE TO THE WHOLE TIME DIRECTOR

Based on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the Shareholders, Board of Directors of your Company, in their Meeting held on May 18, 2023, have re-appointed Mr Ganesh T Argekar (DIN: 06865379) as a Whole-time Director designated as an ‘Executive Director' for a period of 5 (Five) years starting from May 19, 2023 to May 18, 2028 and the remuneration payable is Rs. 95,10,000/- (Rupees Ninety Five Lakhs Ten Thousand Only) per annum and shall also be entitled to any other allowances or perquisites or a combination thereof.

Your Company's Shareholders has already passed the necessary resolution for Re-appointment of Mr Ganesh

Argekar, as a Whole Time Director designated as ‘Executive Director' for a term of 5 (Five) years through Postal Ballot by way of remote E-voting on July 01, 2023 pursuant to the provisions of the Companies Act, 2013, SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations') and any other applicable laws.

Further, based on the recommendation of the Nomination and Remuneration Committee and Board of Directors of your Company, in their Meeting held on May 21, 2024, had approved the revision in the remuneration payable to Mr Ganesh T Argekar, Whole-time Director of the Company from Rs. 95,10,000/- p.a. (Rupees Ninety Five Lakhs Ten Thousand only) including bonus to Rs. 1,20,10,000/- p.a. (Rupees One Crore Twenty Lakhs Ten Thousand only) including Bonus whether paid as salary, allowance(s), perquisites or a combination thereof w.e.f. January 1, 2024. However, the same was paid after the Financial Year ended March 31, 2024.

The overall remuneration payable to Mr Ganesh Argekar shall not exceed the limits prescribed under the applicable provisions of the Companies Act, 2013 and the provisions of Listing Regulations.

Based on the recommendation of the Nomination and Remuneration Committee and Board of Directors of your Company, in their Meeting held on February 8, 2023, had approved the revision and increase in the remuneration payable to Mr Sameer Kothari, Managing Director of the Company from Rs. 13,00,000/- per month (Rupees Thirteen Lakhs Only) to Rs. 14,30,000/- per month (Rupees Fourteen Lakhs Thirty Thousand Only) with effect from January 1, 2023 upto the Financial Year 2024-25 i.e. March 31, 2025 and has also approved the remuneration payable by way of Profit linked Bonus at the rate of 2% of the Net Profit (Profit after tax) for each of the Financial Years FY'23, FY'24 & FY'25 and shall also be entitled to any other allowance or perquisites or a combination thereof as may be agreed mutually with the Board. The Computation of Commission payable to Mr Sameer Kothari was provisional for the Financial Year 2022-23 & 2023-24 and subsequently, the same was paid after the Financial Year ended March 31, 2024.

The overall remuneration payable to Mr Sameer Kothari shall not exceed the limits prescribed under the applicable provisions of the Companies Act, 2013 and the provisions of Listing Regulations.

During the year under review, Mr Harsha Raghavan (DIN: 01761512) has tendered his resignation as Non-Executive Non-Independent Director of your Company with effect from June 20, 2023, citing professional responsibilities and other commitments.

The Board places on record its appreciation for the leadership and invaluable contribution made by Mr Raghavan whose extensive knowledge and understanding of the investments and incredible ability to transform Businesses, coupled with his entrepreneurial experience played an important role in your Company's transformation journey.

Your Board based on the recommendation of the Nomination and Remuneration Committee vide Circular Resolution passed on June 22, 2023, Board of Directors of your Company, vide its Circular Resolution dated June 29, 2023, had appointed Ms Amruta Adukia (DIN: 07877389), as an Additional Director in the category of Non-Executive Non-Independent Director of your Company with effect from June 29, 2023.

The Members in their 38th Annual General Meeting ("AGM") held on September 15, 2023 approved the appointment of Ms Amruta Adukia as Non-Executive, Non-Independent Director of your Company.

RE-APPOINTMENT OF INDEPENDENT DIRECTOR

During the year under review, considering knowledge, acumen, expertise, experience and substantial contribution made by Mr Neeraj Chandra (DIN: 00444694), and on recommendations of the Nomination and Remuneration Committee and based on further recommendation by the Board of Directors in their Meetings held on November 08, 2023, the Shareholders of your Company via postal ballot has approved by passing the Special Resolution, re-appointment of Mr Neeraj Chandra (DIN: 00444694) as the Non-Executive, Independent Director of your Company for a second term of another five years effective from January 25, 2024 and up to January 24, 2029.

Mr Sandeep Mehta (DIN: 00031380), Independent Director of your Company, who was appointed on August 09, 2019 for a term of 5 years upto August 08, 2024. Mr Mehta Did not offer his candidature for re-appointment by the Shareholders for 2nd Term. Consequently, he ceased to be the Director with effect from August 08, 2024. The Board appreciates on record for Mr Sandeep Mehta's contribution in the guidance and expertise knowledge towards the goal of the Company, during his tenure as an Independent Director.

DIRECTOR LIABLE TO RETIRE BY ROTATION

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr Sarvjit Singh Bedi (DIN: 07710419) Non-Executive, Non-Independent Director of your Company, retires by rotation at the ensuing AGM and being eligible, Mr Sarvjit Singh Bedi offers himself for re-appointment. Your Board has recommended his re-appointment.

The brief resume of Director seeking re-appointment at the ensuing AGM along with other details in pursuance of Regulation 36(3) of the Listing Regulations is enclosed herewith as Annexure is annexed to the Notice of the AGM.

Pursuant to the provisions of Section 2(51) and Section 203 of the Companies Act, 2013, Mr Sameer R Kothari, Managing Director, Mr Ganesh Argekar, Whole Time Director, Mr Mayank Samdani, Chief Financial Officer and Mr Bankim Purohit, Company Secretary and Legal Head are the Key Managerial Personnel of your Company.

Pursuant to Section 149(7) of the Companies Act, 2013, your Company has received a declarations from all the Independent Directors of your Company viz. Mr Shashi K Kalathil, Ms Honey Vazirani, Mr Neeraj Chandra and Mr Sandeep Mehta confirming that they meet the criteria of independence as prescribed under Section 149 (6) of the Companies Act, 2013 and Regulation 16(b) of the Listing Regulation in respect of their position as an "Independent Director" of your Company. In terms of provisions of

Section 134(3)(d) of the Companies Act, 2013, the Board of Directors of your Company have taken note of all these declarations of independence received from all the Independent Directors and have undertaken due assessment of the veracity of the same.

Further, the Independent Directors of your Company have confirmed that, they are not aware of any circumstance or situation, which could impair or impact their ability to discharge duties with an objective independent judgment and without any external influence.

Your Board is of the opinion that, the Independent Directors of your Company (including the Independent Directors re- appointed during the year) possess requisite qualifications, experience, expertise (including proficiency) and they hold the highest standards of integrity that enables them to discharge their duties as the Independent Directors of your Company. Further, in compliance with Rule 6(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of your Company have registered themselves with the Indian Institute of Corporate Affairs.

Familiarisation programmes for the Independent Directors were conducted during the Financial Year 2023-24. Apart from this, there were quarterly business presentations by Mr Ganesh T Argekar, Executive Director of your Company. Details of the familiarisation programme are explained in the Corporate Governance Report and are also available on the Company's website and can be accessed at www.hindustanfoodslimited.com.

A minimum of 4 (Four) Board Meetings are held annually. Additional Board Meetings are convened by giving appropriate Notice to address the Company's specific needs and business Agenda. The Meetings of your Board of Directors are pre-scheduled and intimated to all the Directors in advance in order to help them plan their schedule. In case of business exigencies or urgency of matters, approvals are taken by convening the Meetings at a Shorter Notice with consent of the Directors or by passing resolutions through circulation as permitted under the applicable law, which are noted and confirmed in the subsequent Board and Committee Meetings.

During the year under review, the Board of Directors of your Company met 7 (Seven) times viz. on May 18, 2023, August 11, 2023, September 22, 2023, October 20, 2023, November 08, 2023, December 20, 2023 and February 08, 2024. The details of the Board Meetings and the attendance records of the Directors are provided in the Corporate Governance Report which forms part of this Annual Report.

Pursuant to Schedule IV of the Companies Act, 2013, the Independent Directors of your Company are required to hold at least one Meeting in a year without attendance of Non-Independent Directors and Members of the Management. Accordingly, Independent Directors of your Company met on May 18, 2023. All the Independent Directors were present at the Meeting.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, your Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of the Board and its Statutory Committees. Further, the performance evaluation criteria for Independent Directors included a check on their fulfilment of the independence criteria and their independence from the Management.

Based on various criteria, the performance of the Board, various Board Committees, Chairman and Individual Directors (including Independent Directors) was found to be satisfactory.

The Audit Committee comprises of 4 (Four) Members out of which 3 (Three) are Independent Directors. The Committee is been chaired by Mr Shashi K Kalathil, Independent Director, who serves as the Chairman of the Committee, Ms Honey Vazirani, Mr Sarvjit Singh Bedi and Mr Sandeep Mehta are the other Members. The terms of reference, number of Meetings of the Committee held during the year and other informations are provided in Corporate Governance Report which forms part of this Annual Report.

All the recommendations made by the Audit Committee during the Financial Year under review were accepted by the Board.

The Nomination and Remuneration Committee comprises of 3 (Three) Members out of which 2 (Two) are Independent Directors. The Committee is been chaired by Ms Honey Vazirani, Independent Director, who serves as the Chairperson of the Committee, Mr Shashi K Kalathil and Mr Sarvjit Singh Bedi are the other Members. The terms of reference, number of Meetings of the Committee held during the year and other informations are provided in Corporate Governance Report which forms part of this Annual Report.

The terms of reference, number of Meetings held during the year under review and other informations of the Nomination and Remuneration Committee are provided in Corporate Governance Report which forms part of this Annual Report.

The Committee has formulated a Nomination and Remuneration Policy and the same has been uploaded on the website of your Company at www.hindustanfoodslimited.com.

The Committee comprises of 4 (Four) Members out of which 2 (Two) are Independent Directors. The Committee is chaired by Mr Neeraj Chandra, Independent Director, who serves as the Chairman of the Committee, Mr Shrinivas Dempo, Ms Honey Vazirani and Mr Sameer Kothari are the other Members of the Stakeholders Relationship Committee of your Board.

The composition, terms of reference, number of Meetings held during the year under review and other informations of the Stakeholders Relationship Committee are provided in Corporate Governance Report which forms part of this Annual Report.

As required under the Companies Act, 2013, a CSR committee of the Board is duly constituted to formulate and recommend to the Board, the CSR Policy indicating the Company's CSR activities to be undertaken. The CSR Policy as recommended by the Committee and as approved by your Board is available on your Company's website viz. www.hindustanfoodslimited.com.

The CSR Committee comprises of 3 (Three) Members out of which 1 (One) is Independent Director. The Committee is chaired by Mr Sameer Kothari, Mr Ganesh Argekar and Mr Shashi K Kalathil are the other Members of the CSR Committee of the Board. The terms of reference, number of Meetings held during the year and details of the role and functioning of the committee are given in the Corporate Governance Report which forms part of this Annual Report.

During the year under review, your Company took various initiatives towards supporting projects in the area of Education, welfare, healthcare and safety measures, rehabilitation of homeless young women and providing various facilities to senior citizens and needy peoples. Based on the recommendation of the CSR Committee for the amount of expenditure to be incurred on the CSR activities, your Board and the Management of your Company had contributed towards the specified activities laid down under your Company's policy on expenditure on CSR.

The Annual Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules 2014 is set out as Annexure I forming part of this Annual Report.

Knowing the importance of managing and pre-empting risks effectively for sustaining profitable business, your Company has constituted a Risk Management Committee, in line with the SEBI Listing Regulations, as it is covered and applicable to the top 1000 Listed entities.

The Risk Management Committee comprises of 6 (Six) Members out of which 2 (Two) are Independent Directors. The Committee is chaired by Mr Sameer Kothari, Mr Ganesh Argekar, Mr Shashi K Kalathil, Ms Honey Vazirani, Mr Mayank Samdani and Mr Bankim Purohit are the other Members of the Risk Management Committee of the Board.

The terms of reference, number of Meetings held during the year and details of the role and functioning of the committee are given in the Corporate Governance Report which forms part of this Annual Report.

During the Financial Year 2023-24, the Company has raised Rs. 399.99 Crores through Preferential Issues. The details of the funds raised, objects and amount of deviation, if any is provided in the below table:

(Rs. In cr)

There is no deviation or variation in the utilisation of funds from the objects stated in the Explanatory Statement to the Notice for the Extra Ordinary-General Meeting held for approval of Preferential allotment of Warrants. The funds raised through the respective issues were utilised for the purpose for which it was raised and in accordance with the objects of the said Preferential issue.

Pursuant to the provisions of Regulation 32 of the Listing Regulations the necessary disclosures were submitted with the Stock Exchanges and is available on website of the Company viz. www.hindustanfoodslimited.com.

INTERNAL CONTROL SYSTEM

Your Board has laid down Internal Financial Controls (‘IFC') within the meaning of the explanation to Section 134 (5) (e) of the Companies Act, 2013. Your Board believes that, your Company has sound IFC commensurate with the nature and size of its business. Business is however dynamic. Your Board is seized of the fact that IFC are not static and are in fact a fluid set of tools which evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will therefore be gaps in the IFC as business evolves. Your Company has a process in place continuously identify such gaps and implement newer and or improved controls wherever the effect of such gaps would have a material effect on the Company's operations.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information required under Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Directors' Report for the year ended March 31, 2024 is given in a separate Annexure to this Report as Annexure II.

The Annexure in pursuance to the Rule 5 (2) of the Companies (Appointment and Remuneration) Rules, 2014, is not being sent along with this Report to the Members of your Company in line with the provisions of Section 136 of the Companies Act, 2013. Members who are interested in obtaining these particulars may write to the Company Secretary and Legal Head at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by the Members at the Registered Office of the Company, 21 days before the 39th AGM and up to the date of the ensuing AGM during the business hours on working days.

AUDITORS

1. Statutory Auditors

Pursuant to the requirements of Section 139(2) of the Companies Act, 2013 (‘the Act'), M/s M S K A & Associates, Chartered Accountants (Registration No.105047W) were appointed as a Statutory Auditors of your Company for a Second term of 5 (Five) consecutive years from the 37th AGM held on September 22, 2022 till the conclusion of the 42nd AGM to be held in the year 2027. As per notification issued by the Ministry of Corporate Affairs dated May 07, 2018, ratification of the Statutory Auditors at the AGM is not required.

2. Cost Auditors

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, your Company is required to prepare, maintain as well as have the audit of its cost records conducted by a Cost Accountant and accordingly it has maintained such cost records. Your Board on recommendation of the Audit Committee of the Board of Directors in their Meetings held on August 13, 2024 has appointed M/s Poddar & Co., Cost Accountants (Firm Registration No: 101734) as the Cost Auditors of your Company for the year 2024-25 under Section 148 and all other applicable provisions of the Act.

M/s Poddar & Co. have confirmed that they are free from disqualification specified under Section 141 (3) and proviso to Section 148 (3) read with Section 141(4) of the Companies Act, 2013 and that the appointment meets the requirements of Section 141 (3) (g) of the Companies Act, 2013. They have further confirmed their independent status.

The remuneration payable to the Cost Auditor is required to be placed before the Members in the General Meeting for their ratification. Accordingly, a Resolution for seeking Members' ratification for the remuneration payable to M/s Poddar & Co. is included at Item No. 3 of the Notice convening the ensuing AGM.

M/s Poddar & Co., Cost Accountants have carried out the Cost Audit for applicable businesses during the year. There are no qualifications, reservations or adverse remarks or disclaimer made in the Cost Auditors' Report for the Financial Year 2023-24, which requires any clarification or explanation.

3. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act and the Rules thereunder, your Board of Directors has appointed CS Pankaj S Desai, Practicing Company Secretary (COP no. 4098 & Membership no. 3398) to carry out the Secretarial Audit for the Financial Year 2023-24. The Secretarial Audit Report for the Financial Year ended March 31, 2024 forms a part of this Annual Report as Annexure III. The report is self-explanatory and contains some observation, qualification, reservation and adverse remark as follows:

a. The Company had filed a suo-motto settlement application with the Securities and Exchange Board of India (SEBI) on January 31, 2023, in the matter of Regulation 17(1) (b) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 (‘LODR Regulations') proposing to settle by neither admitting nor denying any conclusion of law, the enforcement proceedings that may be initiated against the Company. The High Powered Advisory Committee of SEBI had offered the revised settlement terms and proposed the settlement fees of Rs. 24,32,000/- (Rupees Twenty Four Lakhs Thirty Two Thousand Only) only for which the Company agreed and paid the settlement fees. On receipt of the settlement fees, the SEBI settled the application filed with the Company and passed the necessary settlement order on October 10, 2023.

b. Further, under SEBI's SOP circular, the BSE Limited separately penalised the Company with the penalty of Rs. 84,48,800/- (Rupees Eighty Four Lakhs Forty Eight Thousand Eight Hundred Only) including GST for the Non-Compliance of Regulation 17(1)(b) of LODR Regulations for the same matter for which the Company had filed a suo-moto settlement application with SEBI.

In view of the above, the Company had filed a wavier petition with the BSE Limited and after considering the facts of the case during the personal hearing before the Request Review Committee of BSE Limited with the Company on November 29, 2023 and subsequent written representation made by the Company, the said Committee had passed the order on partial waiver of fines on December 10, 2023 and reduced the penalty to Rs. 52,21,500/- (Rupees Fifty-Two Lakhs Twenty One Thousand Five Hundred Only) along with such other statutory levies inclusive of GST. The Company paid the said penalty of Rs. 52,21,500/- (Rupees Fifty-Two Lakhs Twenty One Thousand Five Hundred Only) under protest.

The Company has paid the penalty amount in full and has also filed an appeal with Securities and Appellate Tribunal (‘SAT') against the penalty levied by the BSE for the same matter which has been settled by SEBI.

Managements Explanation: a. Your Company has paid the settlement fees amounting of Rs. 24,32,000/- (Rupees Twenty Four Lakhs Thirty Two Thousand Only) to SEBI on August 25, 2023. On receipt of the settlement fees, the SEBI settled the application filed with your Company and passed the necessary settlement order on October 10, 2023.

b. Your Company has paid the penalty of Rs. 52,21,500/- (Rupees Fifty-Two Lakhs Twenty One Thousand Five Hundred Only) to BSE Limited on December 11, 2023 under protest and filed an appeal with Securities and Appellate Tribunal (‘SAT') against the penalty levied by the BSE for the same matter which has been settled by SEBI.

As per the requirements of the Listing Regulations, CS Pankaj S Desai, Practicing Company Secretary, have undertaken Secretarial Audit of HFL Healthcare and Wellness Private Limited (Formerly known as Reckitt Benckiser Scholl India Private Limited), Material Subsidiary of your Company for the FY 2023-24. The Secretarial Audit Report for the Financial Year ended March 31, 2024 is annexed as Annexure – IIIA to this

Report.

The notes on Financial Statements referred to in the Statutory Auditor's Report are self-explanatory and therefore, do not call for any further explanations or comments.

There are no qualifications, reservations or adverse remarks or disclaimer made in the Statutory Auditors' Report which requires any clarification or explanation.

Pursuant to Regulation 24 (A) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations 2015, the Independent Secretarial Auditor, CS Pankaj S Desai, Practicing Company Secretary (COP no 4098 & Membership no. 3398) had undertaken an audit for the Financial Year 2023-24 for the

SEBI compliances. The Annual Secretarial Compliance Report has been submitted to the Stock Exchanges within 60 days of the end of the Financial Year.

Your Company has established a Mechanism for the Directors and Employees to report their genuine concerns or grievances about unethical behavior, actual or suspected fraud or violation of the Code. It also provide for adequate safeguards against victimisation of employees who avail the mechanism and allows direct access to the Chairperson of the Audit Committee in exceptional cases. The Whistle Blower Policy also facilitates all employees of the Company to report any instances of leak of Unpublished Price Sensitive information. This policy is also posted on the website of the Company at www.hindustanfoodslimited. com. The Audit Committee of your Company oversees the Vigil Mechanism.

RISK MANAGEMENT

Your Company follows well-established and detailed risk assessment and minimisation procedures, which are periodically reviewed by the Risk Management Committee and Board. Your Company has in place a business risk management framework for identifying risks and opportunities that may have a bearing on the organisation's objectives, assessing them in terms of likelihood and magnitude of impact and determining a response strategy.

The Senior Management assists your Board in its oversight of the Company's management of key risks, including strategic and operational risks, as well as the guidelines, policies and processes for monitoring and mitigating such risks under the aegis of the overall business risk management framework.

The Risk Management policy is uploaded on the website of your Company and can be accessed at www. hindustanfoodslimited.com.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORTING _‘BRSR'_

As stipulated under the Regulation 34(2)(f) of the Listing Regulations and SEBI circular no. SEBI/LAD-NRO/ GN/2021/22 dated May 05, 2021 read with SEBI circular no. SEBI/HO/CFD/CFD-SEC-2/P/CIR/2023/122 dated July 13, 2023, your Company provides the prescribed disclosures in new reporting requirements on Environmental, Social and Governance (‘ESG') parameters called the Business Responsibility and Sustainability Report (‘BRSR') which includes performance against the nine principles of the National Guidelines on Responsible Business Conduct and the report under each principle which is divided into essential and leadership indicators, forms part of this Annual Report.

The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 are given in the Notes to the Financial Statements.

RELATED PARTY TRANSACTIONS

As required under Regulation 23(1) of the Listing Regulations, 2015, your Company has formulated a policy on dealing with Related Party Transactions. The Policy has been uploaded on your Company's website: www.hindustanfoodslimited.com.

The transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business. All the transactions with Related Parties are placed before the Audit Committee and also the Board for approval. Prior Omnibus approval of the Audit Committee and approval of your Board is obtained for the transactions which are foreseeable and a repetitive of nature. The transactions entered into pursuant to the approvals so granted are subjected to audit and a statement giving details of all Related Party Transactions is placed before the Audit Committee and the Board of Directors on a quarterly basis. Further, there were no material Related Party Transactions during the year under review with the Promoters, Directors or Key Managerial Personnel which may have a potential conflict with the interest of the Company. Accordingly, no transactions are required to be reported in Form No. AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of your Company and its future operations except Following:

Your Company had filed a Suo-moto Settlement application without admitting or denying the violation with the SEBI on January 31, 2023, in the matter of Regulation 17(1)(b) of SEBI LODR Regulations. The High Powered Advisory Committee of SEBI had offered the revised settlement terms and proposed the settlement fees of Rs. 24,32,000/- (Rupees Twenty Four Lakh Thirty Two Thousand Only) for which your Company agreed and paid the settlement fees. On receipt of the settlement fees, the SEBI settled the application filed by your Company and passed the necessary settlement order on October 10, 2023. There is no material impact of such settlement, pursuant to the said Settlement Order, on the financial, operation or other activities of your Company.

Further, under SEBI's SOP Circular, the BSE Limited separately penalised your Company with the penalty of Rs. 84,48,800/- (Rupees Eighty Four Lakhs Forty Eight Thousand Eight Hundred only) including GST for the Non-Compliance of Regulation 17(1)(b) of LODR Regulations for the same matter for which your Company had filed a Suo-moto settlement application with SEBI. In view of the above, your Company had filed a wavier petition with the BSE Limited and After considering the facts of the case during the personal hearing with your Company on November 29, 2023 and subsequent written representation made by your Company, the Committee has passed the order on partial waiver of fines on December 10, 2023 and reduced the penalty to Rs.52,21,500/- (Rupees Fifty-Two Lakhs Twenty One Thousand Five Hundred Only) along with such other statutory levies inclusive of GST. The Company paid the penalty of Rs. 52,21,500/- (Rupees Fifty-Two Lakhs Twenty One Thousand Five Hundred Only) under protest. There is no material impact of such fines on the financial, operation or other activities of your Company. Your Company has paid the penalty amount in full and has also filed an appeal with Securities and Appellate Tribunal ("SAT") on January 23, 2024, against the penalty levied by the BSE for Non- Compliance with Regulation 17(1) (b) of SEBI LODR Regulations for which SEBI has already settled the matter. The said appeal has been admitted and outcome is awaited.

MATERIAL CHANGES BETWEEN THE DATE OF THE BOARD REPORT AND END OF FINANCIAL YEAR

There are no material changes and commitments, affecting the financial position of your Company, which has occurred between the end of the Financial Year of your Company i.e. March 31, 2024 and the date of Board's Report i.e. August 13, 2024.

REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the Statutory Auditors nor the Secretarial Auditors nor the Cost Auditors reported to the Audit Committee of the Board, any instances of fraud committed against your Company by its officers or employees, the details of which would need to be mentioned in this Report under section 143(12) of the Companies Act, 2013.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'), the Management Discussion and Analysis Report is presented in a separate section forming part of this Annual Report highlighting the detailed review of operations, performance and future outlook of your Company.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information in respect of matters pertaining to conservation of energy, technology absorption, Foreign exchange earnings and outgo, as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are provided in the Annexure – IV to this Report.

ANNUAL RETURN

Pursuant to the provisions of Section 134 (3) (a) and Section

92 (3) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of your Company for the Financial Year March 31, 2024 is uploaded on the website of your Company and can be accessed at www.hindustanfoodslimited.com.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE _PREVENTION, PROHIBITION AND REDRESSAL_ ACT, 2013

In accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules made there under, your Company has formulated an Internal Policy on Sexual Harassment at Workplace (Prevention, Prohibition and Redressal) and circulated to all the employees, which provides for a proper mechanism for redressal of complaints of sexual harassment.

Your Company is committed to creating and maintaining an atmosphere in which employees can work together without fear of sexual harassment, exploitation or intimidation. Your

Board has constituted Internal Complaints Committees (ICCs) pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. ICCs is responsible for redressal of complaints related to sexual harassment at the workplace in accordance with procedures, regulations and guidelines provided in the Policy.

During the year under review, there were no complaints referred to the ICCs.

Your Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and approved by the Central Government under Section 118 (10) of the Companies Act, 2013.

It has been the endeavor of your Company to follow and implement best practices in Corporate Governance, in letter and spirit. The following forms part of this Annual Report: (i) Declaration regarding compliance of Code of Conduct by Board Members and Senior Management Personnel; (ii) Management Discussion and Analysis Report; (iii) Report on Corporate Governance and;

(iv) Practicing Company Secretary Certificate regarding compliance of conditions of Corporate Governance.

No disclosure or reporting is made with respect to the following items, as there were no transactions during the year under review:

• There was no change in the nature of business

• The issue of Shares to the employees of the Company under any scheme (sweat equity or stock options)

• Managing Director & CEO has not received any remuneration or commission from any of its subsidiaries

• There is no application made or pending proceeding under the Insolvency and Bankruptcy Code, 2016 (31 of 2016)

• There was no instance of one time settlement with any Bank or Financial Institution.

Your Directors would like to express their appreciation for the assistance and co-operation received from the Government authorities, banks, customers, business associates and Members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company during the year under review.

For and on behalf of the Board of Directors

Sameer R Kothari Ganesh T Argekar

Place : Mumbai Managing

Director Executive Director

Date : August 13, 2024

DIN: 01361343 DIN: 06865379