Mahanagar Gas Ltd

To,

The Members

Your Company's Directors have pleasure in presenting the Twenty-Ninth Annual Report along with the Audited Standalone and Consolidated Financial Statements of the Company for the Financial Year ended March 31, 2024 and the Auditors' Report.

FINANCIAL RESULTS

During FY 2023-24, the turnover on a standalone basis was RS. 6,862 Cr. vis a-vis RS. 6,921 Cr. in FY 2022-23. The Profit after Tax (PAT) was RS. 1,289 Cr. for FY 2023-24 as compared to RS. 790 Cr. in FY 2022-23. The Company's financial results for the financial year ended March 31, 2024 are depicted below:

TRANSFER TO RESERVES

During the year under review, no amount was transferred to any of the reserves by the Company. The closing balance of the Retained Earnings of the Company after appropriation for the financial year 2023-24 was RS. 5,044 Cr.

CHANGES IN SHARE CAPITAL

During the year under review, there was no change in share capital structure of the Company.

DIVIDEND

Your Company is consistently distributing dividends to the Shareholders. The Board of Directors at their meeting held on January 23, 2024, declared Interim Dividend for the financial year 2023-24 of RS. 12/- per equity share of face value of RS. 10/- each and was paid to those members whose names appeared in the Register of Members/ List of Beneficial Owners as on the record date i.e. February 5, 2024.

Further, your Directors recommended the Final Dividend of RS. 18/- per share in its Board Meeting held on May 09, 2024, subject to approval of shareholders at the 29^th Annual General Meeting.

The Company's Dividend Distribution Policy is available on the Company's website at https://www.mahanagargas.com/ MGL-corporate/investors/dividend/dividend-policy

STATE OF COMPANY'S AFFAIRS

The Financial Year 2023-24 was one of the phenomenal year in terms of strategic investment as your Company has grown inorganically and has spread its wings by entering into new GAs and business of LNG through acquisition and joint venture. Your Company has achieved new heights in its business growth. Your Company has successfully acquired 100% equity share capital of Unison Enviro Private Limited (UEPL). UEPL has been authorized by PNGRB to implement the City Gas Distribution (CGD) network in the Geographical Areas (GAs) of Ratnagiri, Latur & Osmanabad in the state of Maharashtra and Chitradurga & Davanagere in the State of Karnataka. Further, your Company has also incorporated a Joint Venture Company with Baidyanath LNG Private Limited, i.e. Mahanagar LNG Private Limited to carry out business of Liquefied Natural Gas (LNG) in India. Further, your Company has established its footprint in EV sector by entering into a Share Subscription Agreement (SSA) with 3EV Industries Private Limited (3ev), a three-wheeler (3W) electric vehicle (EV) manufacturer, for acquiring ~31% shareholding in 3ev and completed acquisition of 19% shareholding as on March 31, 2024. These 3W EV's are expected to replace mostly diesel and petrol fuelled small commercial vehicles. The detailed information on the business overview and outlook of the Company is discussed in the Management Discussion & Analysis section forming part of the Annual Report.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

A list of bodies corporate which are subsidiaries/ associates/ joint ventures of your Company is provided as part of the notes to Consolidated Financial Statements. During the year under review, following subsidiary and joint venture have been formed/ acquired:

Unison Environ Private Limited (Wholly Owned Subsidiary)

Mahanagar LNG Private Limited (Subsidiary Company - Joint Venture)

As on March 31, 2024, your Company has two subsidiaries. Pursuant to the provisions of Section 129, 134 and 136 of the Companies Act, 2013 read with rules made thereunder and Regulation 33 of the SEBI Listing Regulations, your Company has prepared Consolidated Financial Statements and a separate statement containing the salient features of financial statement of subsidiaries in Form AOC-1 have been attached as Annexure 1 to this Report, which forms part of this Annual Report.

The financial statements of the subsidiary / joint venture companies shall also be kept for inspection by any shareholder during working hours of the Company's registered office and that of the respective subsidiary/ joint venture companies concerned. In accordance with Section 136 of the Companies Act, 2013, the Audited Financial Statements, including Consolidated Financial Statements and related information of your Company and audited accounts of each of its subsidiary/ joint venture, are available on website of the Company at https://www.mahanagargas.com

Your Company has formulated a policy for determining Material Subsidiaries. The policy is available on your Company's website at https://www.mahanagargas.com/MGL-corporate/ investors/policies

DEPOSITS

During the Financial Year 2023-24, your Company has not accepted any deposit.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Sections 134(3)(c) and 134(5) of the Companies Act, 2013, your Directors hereby confirm that for the financial year ended March 31, 2024:

a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;

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 your Company as at the end of the financial year and of the profits of your Company for that period;

c) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your 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 by the Company which are adequate and are operating effectively;

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

RISK MANAGEMENT

MGL recognizes the importance of proactively identifying and managing risks to ensure the Company's long-term profitability and sustainability. The Risk Management Committee is mandated to monitor the effectiveness of the risk management process and systems in MGL.

EthicalleadershipandhumancapitalarethecornerstonesofMGL's Risk Management philosophy as these ensure entrepreneurial flair, sound corporate reputation and effective governance.

As part of Enterprise Risk Management policy, we have conducted a thorough risk assessment to identify potential risks and their potential impact on our business. The risks identified fall into several categories, including but not limited to Strategic risks, Operational risks, Financial risks and Compliance risks.

Our Board Committee recognized the risk associated with data protection posture and expanding cyber security threats, which are currently the top concerns for organizations. MGL has started taking numerous measures to improve the data protection and security posture in accordance with the Digital Personal Data Protection Act, 2023.

INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY

Your Company places a strong emphasis on maintaining effective Internal Financial Controls over financial reporting to ensure the accuracy and integrity of its financial statements. Your Company has designed and implemented a comprehensive Internal Financial Control system over financial reporting. This system ensures that all transactions are authorized, recorded, and reported accurately in a timely manner. The Internal Financial Control system provides reasonable assurance over the integrity and reliability of the Company's financial statements. This assurance is crucial for stakeholders in evaluating the company's financial performance and position.

A robust mechanism is in place for periodic review of Risk Assessment and Control Matrix and testing of controls for both design and operating effectiveness. This testing is conducted twice a year to ensure that controls are not only appropriately designed but also functioning effectively in practice. The results of these tests are reported to the Audit Committee. This ensures transparency and accountability in the evaluation of the company's internal controls and provides oversight by a key governance body.

VIGIL MECHANISM AND WHISTLE BLOWER POLICY

Your Company prioritizes the establishment of a robust vigil mechanism to ensure adherence to the MGL's Code of Conduct and related policies. Your Company has a Whistle Blower Policy for its directors, employees, and other stakeholders. This policy allows individuals to report unethical practices and irregularities without fear of reprisal. The Whistle Blower Policy is periodically reviewed and revised to align with regulatory requirements and changing workplace needs. This ensures that the Policy remains effective and relevant over time. No person is denied access to the Chairman of the Audit Committee, ensuring that individuals have a direct channel to report concerns or grievances.

The Vigil Mechanism fosters a culture of trust and transparency among all stakeholders, encouraging open communication and accountability. The Whistle Blower Policy provides adequate protection to those who report unethical practices and irregularities. This protection is crucial in encouraging individuals to come forward with concerns without fear of retaliation. All reported incidents are investigated, and suitable action is taken in line with the Whistle Blower Policy. This ensures that reported concerns are addressed effectively and responsibly. The Whistle Blower Policy has been appropriately communicated within the Company and is available on the Company's website at https:// www.mahanagargas.com/MGL-corporate/investors/policies.

This ensures that all stakeholders are aware of the policy and know how to access it for reference or reporting purposes.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted the Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014. Pursuant to the provisions of Section 135 of the Companies Act, 2013, the Company has also formulated a Corporate Social Responsibility Policy which is also available on the website of the Company at https://www. mahanagargas.com/MGL-corporate/investors/policies

The Annual Report on CSR activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed herewith as Annexure 2 to this report.

DISCLOSURES PURSUANT TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

In the commitment to fostering a workplace environment built on respect, inclusivity and safety, your Company prioritizes the eradication of all forms of harassment, including sexual harassment. Your Company firmly believes that every employee deserves to work in an environment free from any form of intimidation, coercion, or discrimination. As such, your Company has in place a Policy on Prevention of Sexual Harassment of Women at Workplace which is in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act). Your Company has implemented robust policies and procedures aimed at preventing and addressing instances of sexual harassment. These policies are regularly communicated to all employees and are strictly enforced. Your Company conducts comprehensive training programs to ensure that all staff members understand what constitutes sexual harassment and their rights and responsibilities in reporting any such incidents.

Your Company has also complied with the provisions of setting up of an Internal Complaints Committee which is duly constituted in compliance with the provisions of the POSH Act. Furthermore, your Company maintains confidentiality and offers multiple avenues for reporting complaints, ensuring that every individual feels empowered to come forward without fear of retaliation. By upholding these standards, your Company is dedicated in cultivating a workplace culture where all individuals are valued, respected and supported.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE

During the FY 2023-24, there was no order or direction of any court or tribunal or regulatory authority either affecting Company's status as a going concern or which significantly affected Company's business operations. However, the Petroleum and Natural Gas Regulatory Board (PNGRB) has issued public notice (PNGRB/Auth/1-CGD(08)/2023) dated March4, 2024, informing that the infrastructure exclusivity of CGD Network related to MGL GA's namely Mumbai and Greater Mumbai has come to an end against which MGL has filed an application before the Delhi

High Court in the pending Exclusivity Writ seeking a stay on the operation, implementation and execution of the Public Notice issued by the PNGRB. Further, MGL has also sought for extension of Infrastructure Exclusivity for the said GAs.

The process of ending the exclusivity as per the PNGRB Act requires PNGRB to lay down the principles for fixing the exclusivity period of CGD entities and their expiry, by passing specific orders fixing such periods. PNGRB has not yet initiated any of these actions and its efforts of bypassing this statutory process has been challenged. Further, even post-expiry of exclusivity period, there is a separate process to declare an entity as a common carrier. There is pending litigation on all these aspects, and in view of orders of the Hon'ble Delhi High Court passed till date, the Company is of the view that presently there is no risk that MGL's exclusivity period has ended and MGL's CGD network being declared as a common carrier till the matter gets finally disposed of by Hon'ble Delhi High Court.

MATERIAL CHANGES AFFECTING THE COMPANY

There have been no material changes and commitments affecting the financial position of the Company between the end of the Financial Year and date of this report. There has been no change in the nature of the business of the Company.

INSOLVENCY AND BANKRUPTCY CODE, 2016

No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of the application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable.

A. Appointment and Cessation of Directors:

The details of appointment and cessation of Directors of the Company, during the year under review, are given in the table as hereunder:

The Board places on record its appreciation for the valuable services rendered by Mr. Mahesh V. Iyer during his tenure as Chairman of the Company. The Company has immensely benefitted from the contribution, guidance and leadership of Mr. Iyer as the Chairman of the Company.

All Independent Directors of the Company have submitted the Declaration of Independence to the Company and pursuant to the provisions of Section 149 of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").

The appointment of the Director mentioned above was recommended by the Nomination and Remuneration Committee of the Board and was approved by the shareholders through Postal Ballot.

B. Key Managerial Personnel other than Directors:

During the year under review, there was no change in the Key Managerial Personnel of the Company.

Pursuant to Section 203 of the Companies Act, 2013, Mr. Ashu Shinghal, Managing Director, Mr. Sanjay Shende, Deputy Managing Director, Mr. Rajesh D. Patel, Chief Financial Officer and Mr. Atul Prabhu, Company Secretary and Compliance Officer are the Key Managerial Personnel of the Company as on March 31, 2024.

COMMITTEES OF BOARD

The details of various committees constituted by the Board, including the committees mandated pursuant to the applicable provisions of the Act and Listing Regulations, are given in the Corporate Governance Report, which forms part of this Annual Report.

NUMBER OF MEETINGS OF THE BOARD

During the year under review, the Board met 11 (Eleven) times. The details of board meetings and the Company attendance of the Directors are provided in the Corporate Governance Report, which forms part of this Annual Report.

INDEPENDENT DIRECTORS' MEETING

The Independent Directors met on March07, 2024, without the attendance of Non-Independent Directors and members of the management. The Independent Directors reviewed the performance of Non-Independent Directors, the Committees and the Board as a whole along with the performance of the

Chairman of your Company, taking into account the views of Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

ANNUAL EVALUATION OF THE PERFORMANCE OF THE BOARD, ITS COMMITTEES AND OF INDIVIDUAL DIRECTORS

The Board adopted a formal mechanism for evaluating its performance as well as that of its Committees and Individual Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects of the Boards' functioning such as composition of the Board and Committees, experience and competencies etc.

NOMINATION AND REMUNERATION POLICY

In terms of Section 178 of the Companies Act, 2013 and the Listing Regulations, a policy on Nomination and Remuneration of Directors, Key Managerial Personnel, Senior Management and other employees of the Company, acts as a guideline for determining, inter-alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal and evaluation of performance of the Directors, Key Managerial Personnel, Senior Management and other employees. The policy is available on the website of the Company at https:// www.mahanagargas.com/MGL-corporate/investors/policies

STATUTORY AUDITORS

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Reg. No. 117366W/W-00018) was appointed as Statutory Auditors of the Company to hold office for a period of 5 years from the conclusion of the 27^th Annual General Meeting held on August 24, 2022 till the conclusion of the 32^nd Annual General Meeting of the Company.

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Reg. No. 117366W/W-00018) has carried out the Statutory Audit of your Company for the financial year 2023-24. Further, the Auditors' Report "with an unmodified opinion", given by the Statutory Auditors on the Standalone and Consolidated Financial Statements of the Company for FY 2023-24, is disclosed in the Financial Statements forming part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditors in their Report for the year under review. The Notes to the financial statements referred to in the Auditors' Report for FY 2023-24 of M/s. Deloitte Haskins & Sells LLP are self-explanatory and do not call for any further comments.

REPORTING OF FRAUDS BY AUDITORS

The Statutory Auditors have not reported any incident of fraud to the Audit Committee or the Board of Directors under Section 143(12) of the Companies Act, 2013, during the financial year under review.

SECRETARIAL AUDITORS

Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company has appointed M/s. Mayekar & Associates, Company Secretaries to conduct the Secretarial Audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report for the Financial Year 2023-24, issued by M/s. Mayekar & Associates in Form MR-3 is enclosed herewith as Annexure 3 to this report.

The Secretarial Audit Report is self-explanatory in nature and does not contain any qualification, reservation, adverse remark or disclaimer except delay in submission of disclosure on Related Party Transactions for the half year ended September 2023 by one day. The Company has complied with the provisions of the applicable laws.

COST AUDITORS

Your Company is required to carry out Cost Audit pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014. The Board of Directors has on the recommendation of the Audit Committee appointed M/s. ABK & Associates, Cost Auditors to audit the Cost Accounts of the Company for the Financial Year 2023-24 on remuneration of RS. 2,50,000/- (Rupees Two Lakh Fifty Thousand Only) plus out of pocket expenses to be reimbursed up to 5% of basic fee and applicable taxes.

Your Company is maintaining cost records as specified by the Central Government under Section 148 of the Companies Act, 2013.

PARTICULARS OF LOANS, ADVANCES, GUARANTEES AND INVESTMENTS

Pursuant to Section 186 of Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars of loan given, investment made, guarantee given and security provided are given in the Standalone Financial Statement of the Company. (Please refer Note 5, 9 and 31.3 to the Standalone Financial Statement).

RELATED PARTY TRANSACTIONS

During the year under review, all Related Party Transactions were entered at arm's length and in ordinary course of business of the Company. The Audit Committee accords prior approval for all the Related Party Transactions. Prior approval of shareholders is obtained for all Material Related Party Transactions to be entered into by the Company. The details of Related Party Transactions entered into by the Company during the year under review are mentioned in the notes to the Financial Statements. Further, all Material Related Party Transactions arising from contracts/ arrangements with the related parties referred to in the Section 188(1) of the Companies Act, 2013 and as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 have been attached as Annexure 4 to this Report. Your Company has adopted a Board approved Related Party Transactions Policy and is uploaded on the Company's website at the web link https:// www.mahanagargas.com/MGL-corporate/investors/policies

DISCLOSURE REGARDING REMUNERATION TO DIRECTORS AND EMPLOYEES

The statement of Disclosure of Remuneration under Section 197 of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (‘Rules'), is appended as Annexure 5 to the Report. The information as per Rule 5 of the Rules, forms part of this Report. However, as per second proviso to Section 136(1) of the Companies Act, 2013 and second proviso of Rule 5 of the Rules, the Report and Financial Statements are being sent to the Members of the Company excluding the statement of particulars of employees under Rule 5(2) of the Rules. Any member interested in obtaining a copy of the said statement may write to the Company Secretary at the Registered Office of the Company.

CONSERVATIONOFENERGYANDTECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Your Company consciously makes all efforts to conserve energy across all its operations. A report containing details with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, required to be disclosed in terms of Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is enclosed as Annexure 6 to this Report.

MANAGEMENT DISCUSSION AND ANALYSIS

A separate report on Management Discussion and Analysis as stipulated by the Listing Regulations forms part of this Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Business Responsibility and Sustainability Report for the year ended March 31, 2024, as stipulated under Regulation 34 of the Listing Regulations, is annexed which forms part of this Annual Report.

CORPORATE GOVERNANCE

As per the requirements of the Listing Regulations, a detailed Report on Corporate Governance and certificate regarding compliance of conditions of Corporate Governance are part of this Annual Report.

M/s. Akansha Rathi & Associates, Practicing Company Secretary vide certificate dated July 25, 2024 has confirmed that the Company is compliant with the conditions stipulated in the Chapter IV of the Listing Regulations.

STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY, EXPERTISE AND EXPERIENCE

The Board confirms that Independent Directors appointed by the Company possess integrity, expertise and experience.

ANNUAL RETURN

Pursuant to the provisions of Sections 92(3) and 134(3) of the Companies Act, 2013 read with Rules made thereunder, the copy of Annual Return is available on the website of the Company i.e. https://www.mahanagargas.com

OTHER DISCLOSURES

In terms of the applicable provisions of the Companies Act, 2013 and Listing Regulations, your Company additionally discloses that during the year under review:

Your Company has not issued any shares with differential voting rights or Sweat Equity Shares;

There is no plan to revise the Financial Statements or Directors' Report in respect of any previous financial year;

Your Company does not engage in commodity hedging activities.

ACKNOWLEDGEMENT

We take this opportunity to place on record our appreciation to the Ministry of Petroleum & Natural Gas (MOPNG), Government of India (GOI), Petroleum & Natural Gas Regulatory Board (PNGRB), Government of Maharashtra (GOM), Maharashtra State Road Development Corporation Limited (MSRDC), Municipal Corporations of Greater Mumbai (MCGM), Navi Mumbai, Thane, Mira-Bhayander, Kalyan-Dombivali, Raigad, Panvel, other State and Central Government Authorities, Mumbai Metropolitan Regional Development Authority (MMRDA), Maharashtra Industrial DevelopmentCorporation(MIDC),PoliceandFireBrigadeauthorities, all our customers, members, investors, vendors, suppliers, business associates, bankers and financial institutions, media and stock exchanges for their continuous co-operation and support.

We are grateful for the guidance and support received from Statutory Auditors, Internal Auditors, Cost Auditors and Secretarial Auditors of the Company.

We acknowledge the patronage of GAIL (India) Limited and GOM for their support and above all, we place on record our sincere appreciation for the hard-work, solidarity and contribution of each and every employee of the Company in driving the growth of the Company.