MCON Rasayan India Ltd

TO

MCON RASAYAN INDIA LTD.

The Board of Directors presents the 7^th Annual Report together with Audited Accounts of your Company, M/s. MCON RASAYAN INDIA LIMITED for the year ended on 31st March, 2023.

FINANCIAL SUMMARY AND HIGHLIGHTS

The financial performance of the Company for the year ended 31st March, 2023 is summarized as under:

(Amount in Lakhs)

STATE OF COMPANY'S AFFAIR

During the year under review, the Gross receipt from operation stood at Rs. 3104.97 Lakhs as compared to Rs. 1,921.65 Lakhs in the Previous Year.

The Company has gained a net profit after tax of Rs. 113.54 Lakhs as compared to Rs. 49.54 Lakhs in the Previous Year.

The Directors are optimistic about achieving better results in the upcoming financial year. They are pleased with the current performance of the company and acknowledge the efforts and contributions that have led to this success. With this positive momentum, the Directors look forward to continued growth and success in the future.

SHARE CAPITAL OF THE COMPANY

During the period under review, the authorised share capital of the Company stood at:

"70,00,000 (Seventy Lakh) Equity Shares of Rs. 10 each aggregating to Rs. 7,00,00,000 (Rupees Seven Crore)."

During the year, your Company issued and allotted 23,43,750 Equity Shares as Bonus Issue in the ratio of 1.25:1 to the existing Equity Shareholders of the Company and 7,50,000 Equity Shares were issued on Private Placement basis.

Further pursuant to Shareholders Resolution passed on December 19, 2022 and In principal approval obtained from NSE Limited on February 15, 2023, the Board on March 15, 2023 allotted 17,10,000 Equity Shares of Rs. 10/- each at a price of Rs. 40/- by way of Initial Public Offer.

During the year, company has got approval for 'Mcon Employee stock Exchange Plan 2022 (Mcon ESOP 2022)' from its shareholders at Extra ordinary General meeting held on 19th December 2022. However, your Company has not granted any shares to its employees under Mcon ESOP 2022 during the year under review .

RESERVES

The Board of Directors of your Company has decided not to transfer any amount to the Reserves for the year under review.

DIVIDEND:

The Board of Directors of your company, after considering holistically the relevant circumstances and keeping in view the need to conserve the resources for working capital requirements and other capital expenditure, has decided that it would be prudent, not to recommend any Dividend for the year under review.

ANNUALRETURN

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Annual Return as on March 31, 2022 is available on the Company's website at https://mconrasayan.com.

INITIAL PUBLIC OFFER (IPO)

The Company has made public offer of Equity Shares during the year ended March 31, 2023 in accordance with SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, wherein a fresh issue of 17,10,000 Equity Shares was made through Fixed Price Issue.

The public issue was opened on March 06, 2023 and closed on March 10, 2023 at an offer price of 40/- per Equity Share (including a share premium of 30/- per Equity Share). The Company's IPO received an overwhelming response and was oversubscribed, reflecting a huge investor appetite for the issue. The Equity Shares were allotted on March 15, 2023 at an offer price of Rs. 40 per Equity Share to the respective applicants under various categories. The Equity Shares of the Company were listed on the Emerge platform of National Stock Exchange of India Limited ("NSE") on March 20, 2023.

UTILISATION OF IPO PROCEEDS

The IPO proceeds of Rs. 684.00 Lakhs have been utilised to fund the working capital requirements of the Company and for General Corporate Purposes.

Further, there was no deviation/variation in the utilization of the gross proceeds raised through IPO.

LISTING WITH STOCK EXCHANGE

The Company got listed on Emerge Platform of NSE on20th March 2023.

DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

The Company does not have any subsidiary, joint venture or an associate company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

i. Change in Directors and Key Managerial Personnel

During the year in review, no resignations of any Directors or Key Management Personnel were reported. However, the following individuals were appointed to fill important roles:

i. Independent Directors

The terms and conditions of appointment of Independent Directors are as per Schedule IV of the Act.

In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent Directors of the Company have confirmed that they have registered themselves with the databank maintained by the Indian Institute of Corporate Affairs ('MCA').

In the opinion of the Board, the independent directors possess the requisite integrity, experience, expertise and proficiency required under all applicable laws and the policies of the Company.

DISCLOSURES BY DIRECTORS

The Board of Directors have submitted notice of interest in Form MBP-1 under Section 184(1) as well as intimation by directors in Form DIR-8 under Section 164(2) and declarations as to compliance with the Code of Conduct of the Company.

STATEMENT OF DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received necessary declarations from each Independent Director under 149(7) of the Companies Act, 2013, that they meet the criteria of Independence laid down under section 149(6) of the Companies Act 2013.

NUMBER AND DATES OF MEETINGS OF THE BOARD

During the year under review, Nineteen (19) Board Meetings were held on the following dates:

The provisions of Companies Act, 2013 were adhered while considering the time gap between two such meetings.

The details of composition of the Board and the attendance record of the Directors at the Board Meetings and AGM held during the financial year ended on March 31, 2023 is as under:

DIRECTORS' RESPONSIBILITY STATEMENT

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) The directors had 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 profit and loss of the company for that period;

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

(d) The directors had prepared annual accounts on going concern basis.

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

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

BOARD COMMITTEES

The Committees of the Board of Directors of the Company plays vital role in the governance and focus on specific areas and make informed decisions within the delegated authority. Each Committee is governed by their respective terms of reference which exhibit their composition, scope, powers, duties and responsibilities.

The Board of Directors has the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholder Relationship Committee

The details of the Committees of the Board along with their composition and number of meetings are as follows:

a) AUDIT COMMITTEE

The Audit Committee ('AC') of the Company had been constituted and functions in accordance with provisions of Section 177 of the Act and Listing Regulations. The Company Secretary is acting as the Secretary to the Audit Committee.

All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company.

Some of the key functions and responsibilities of the AC is enumerated as below:

• Reviewing the procedures of financial reporting

• Review and monitor the auditor's independence, performance and effectiveness of audit process

• Review the adequacy of internal audit function, coverage and frequency of internal audit, appointment, removal, performance and terms of remuneration of the Internal Auditor.

• Discuss with the internal auditor and senior management, significant internal audit findings and follow-up thereon.

During the year under review, the Audit Committee of the company met only once on 31/03/2023. This was due to the fact that the company was previously a private company, and the provisions regarding the formation of the audit committee were not applicable.

However, it is important to note that the company underwent a significant change when it got listed on 20th March, 2023, which triggered the provisions for the formation of the audit committee. However, the committee was officially formed on 19th December, 2022, in accordance with the applicable regulations.

As on the date of this Report, the Committee comprises of 3 Directors, i.e. two Independent Directors and the Managing Director as a member.

The detail of composition of the Committee is as under:

b) NOMINATION AND REMUNERATION COMMITTEE:

As per provisions of Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI (LODR), the Nomination and Remuneration Committee should consist of 3 or more Non-Executive Directors out of which not less than one-half shall be Independent Directors.

Some of the key functions and responsibilities of the NRC is enumerated as below:

• Formulate criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a Policy relating to the remuneration for the directors, key managerial personnel (KMPs) and other employees;

• Formulation of criteria for evaluation of performance of Independent Directors and the Board of Directors;

• Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board of Directors their appointment and removal.

• Recommending to the Board whether to extend or continue the term of appointment of appointment of the Independent Director, on the basis of report of performance evaluation of Independent Directors.

The Nomination and Remuneration Committee met once in the year under review on 31/03/2023.

It is important to note that the Company was previously a private company, and the provisions regarding the formation of the Nomination and Remuneration Committee were not applicable. However, the Company underwent a significant change when it got listed on 20th March, 2023, which triggered the provisions for the formation of the Nomination and Remuneration Committee. However, the committee was officially formed on 19th December, 2022, in accordance with the applicable regulations.

As on the date of this Report, the Committee comprises of 3 Directors, i.e. two Independent Directors and one NonExecutive Director as a member.

The detail of composition of the Committee is as under:

NOMINATION AND REMUNERATION POLICY :

In accordance with Section 178 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has formulated a Nomination and Remuneration Policy.

The policy is available on the website of the Company at https://mconrasayan.com/wp-content/uploads/ 2022/12/Nomination-and-Remuneration-Policy.pdf

c) STAKEHOLDER RELATIONSHIP COMMITTEE

In compliance of provisions of Section 178 of Companies Act, 2013 & Regulation 20 of the SEBI (LODR) Regulations, 2015, the Board has constituted Stakeholders' Relationship Committee. The Stakeholders Relationship Committee is entrusted with the responsibility of addressing the shareholders'/ investors' complaints with respect to share transfers, non-receipt of annual reports, dividend payments, issue of duplicate share certificates, transmission of shares and other shareholder related queries, complaints etc.

The Secretarial Department of the Company and the Registrar and Share Transfer Agent, Link Intime India Private Limited attends to all grievances of the shareholders received directly or through SEBI, Stock Exchanges, Ministry of Corporate Affairs, Registrar of Companies, etc.

Continuous efforts are made to ensure that grievances are more expeditiously redressed to the complete satisfaction of the investors. Shareholders are requested to furnish their updated telephone numbers and email addresses to facilitate prompt action.

During the year under review, the Stakeholder Relationship Committee of the company met only once on 31/03/2023. This was because the company was previously a private company, and the provisions regarding the formation of the Stakeholder Relationship Committee were not applicable.

However, it is important to note that the company underwent a significant change when it got listed on 20th March, 2023, which triggered the provisions for the formation of the Stakeholder Relationship Committee. However, the committee was officially formed on 19th December, 2022, in accordance with the applicable regulations.

As on the date of this Report, the Committee comprises of 3 Directors, i.e. two Independent Directors and one NonExecutive Director as a member

The detail of composition of the Committee is as under:

WHISTLE BLOWER POLICY

In accordance with Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has adopted a Whistle Blower Policy which provides for adequate safeguards against victimization of persons who use Vigil Mechanism and make provision for direct access to the Chairperson of the Audit Committee. The policy is available on the website of the Company at https://mconrasayan.com/wp-content/uploads/2022/12/Vigil-Mechanism-Whistle-Blower-Policy- for-Directors-and-Employees-1-1.pdf

PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 & 25 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance and of the Independent Directors individually as well as the Committees of the Board. The performance evaluation of all the Directors was also carried out by the Nomination and Remuneration Committee. The performance evaluation of the Chairman and the NonIndependent Directors was carried out by the Independent Directors.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The transactions during the financial year with related parties were in the ordinary course of business and on an arm's length basis. Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed form AOC-2, appended as 'Annexure I' to the Board's Report.

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large and hence there is no information to be provided as required under Section 134(3) (h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT, 2013

Details of Loans, Guarantees or Investments covered under the provisions of Section 186 of the Act, if any are given in the Notes to the Financial Statements.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The Statement pertaining to provision of Rule 5(2) & (3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 requiring the names of top ten employees in terms of remuneration drawn. It is also to be stated here that there was no employee during the year who was in receipt of remuneration exceeding the limits mentioned in Rule 5 (2) (i), (ii) and (iii) of Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014.

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 is given in the Statement annexed herewith as 'Annexure II'.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report on the operations of the Company, as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") is annexed herewith marked as 'Annexure III' to this Report.

AUDITORS

a) SECRETARIAL AUDITOR

"M/s. D. S. Momaya & Co. LLP, (FRN No. L2022MH012300), Practicing Company Secretaries, bearing peer review certificate number 2864/2022 issued by the Institute of Company Secretaries of India were appointed as the Secretarial Auditor of the Company for the Financial Year 2022-23."

The Secretarial Audit Report for the Financial Year ended on March 31, 2023 is annexed herewith marked as 'Annexure IV' to this Report.

RESERVATION AND QUALIFICATION ON SECRETARIAL AUDITOR'S REMARKS

The Secretarial Auditors Report as provided by the Secretarial Auditors are self-explanatory and contain no qualification remark, hence no explanation by the Board is required.

b) STATUTORY AUDITORS

DEVANG KUMAR DAND & ASOCIATES, Chartered Accountants (Firm Registration No.-135250W), were appointed as Auditors of the Company for a term of 5 years on 30th November, 2021, i.e. from 01-04-2021 to 31-03-2026 till the conclusion of the General Meeting to be held in the year 2026.

The Audit Report for the Financial Year ended on March 31, 2023 is annexed herewith marked as 'Annexure V' to this Report.

RESERVATION AND QUALIFICATION ON AUDITOR'S REMARKS

The Auditors Report as provided by the auditors are self-explanatory and contain no qualification remark, hence no explanation by the Board is required.

DETAILS IN RESPECT OF FRAUD REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no frauds reported by the auditor under sub-section (12) of Section 143.

FOREIGN EXCHANGE EARNINGS, CONSERVATION OF ENERGY, AND ABSORPTION OF TECHNOLOGY:

Information required under the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 are not given as the company is not covered in the list of industries which should furnish information relating to conservation of energy.

FOREIGN EXCHANGE EARNINGS & OUTGO - ACTUAL INFLOW AND OUT FLOW

Details of total foreign exchange inflows and outflows during the year are as follows:

FAMILIARISATION PROGRAMME

The Company has put in place an induction and familiarization programme for all its Directors including the Independent Directors. The familiarization programme for Independent Directors in terms of provisions of Regulation 46(2)(I) of the Listing Regulations is uploaded on the website of the Company

RISK MANAGEMENT POLICY

The Board has reviewed the business plan at regular intervals and developed the Risk Management Strategy which encompasses laying down guiding principles on proactive planning for identifying, analysing and mitigating all the material risks, both external and internal viz. Environmental, Business, Operational, Financial and others.

Risks emanating from uncertainties in the global market place and growing complexity in the value chain are cited by most as the important factors contributing to increased risks. The gist of the regulatory developments across various countries including India is that the Boards have been tasked with the onerous responsibility of ensuring alignment between strategy, risks, rewards and executive compensation. Attention is being given to improving existing Risk Management systems and processes, the softer and more fundamental issue of embedding risk into the organization's culture and making it an integral part of the business. However, risk identification and assessment processes are not geared to provide an early indicator of likely risks or potential loss events that organizations could face in the future. Information sources are largely inward focused as compared to being forward looking and external focused. Detailed analysis of competitor strategies / benchmarking and scenario planning are widely used as and when required. Issues such as sustainability and climate change are part of the risk assessments. Fearful of both business failure and the penalties of non-compliance, the Company is sensitive to swelling of their governance, Risk Management and compliance departments (GRC). This has led to a costly and complex web of often uncomplicated structures, policies, committees and reports creating duplication of effort. Risk Managers are spending a disproportionate amount of their time on controls, compliance and monitoring activities although their real priorities lie elsewhere. Risk management roles and responsibilities at the management level are well defined at the Company level. While the Company has more or less formalized Risk Management roles and responsibilities, risk governance processes would require considerable attention if the Company has to leverage Risk Management as a driver of enterprise value.

CORPORATE SOCIAL RESPONSIBILITY

The Company was not under obligation to make expenditure on CSR (Corporate Social Responsibility). In view of this, information and attributes in terms of section 135 of the Companies Act 2013 are not required to be given.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its Business including

adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and the timely preparation of reliable financial information.

The Company has adopted framework provided by ICAI in 'Guide to Internal Financial Control over Financial Reporting" for developing and establishing internal control system.

Based on the framework of internal financial controls established and maintained by the Company, work performed by the statutory auditors and external agencies, the reviews performed by Management and the relevant Board Committees, the Board is of the opinion that the Company's internal financial controls were adequate and effective as on 31st March, 2023 with reference to the Financial Statements.

COSTRECORDS

The Company is not obligated to maintain cost records under Section 148 of the Companies Act, 2013.

CORPORATE GOVERNANCE :

As our Company has been listed on SME Emerge Platform of National Stock Exchange Limited (NSE), by virtue of Regulation 15 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 the compliance with the Corporate Governance provisions as specified in Regulation 17 to 27 and Clause (b) to (i) of sub regulation (2) of Regulation 46 and Para C, D and E of Schedule V are not applicable to the Company.

Hence, Corporate Governance Report does not form a part of this Board Report.

DISCLOUSRE AS PER SEXUAL HARRASMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company Firmly believes in providing a safe and Harassment free working environment for its Employees. It has a zero- tolerance policy towards sexual harassment and has adopted a policy on prevention, prohibition and rederessal of sexual harassment at work place in line with said act and Rules thereunder which is placed on its website i.e. https://mconrasayan.com/wp-content/uploads/2022/12/POSH-Policy.pdf. No Complaints were received during the year ended 31st March 2023.

PREVENTION OF INSIDER TRADING:

In compliance with the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended, the Company has formulated and adopted the revised Code of Conduct for Prevention of Insider Trading. The object of the Insider Trading Code is to set framework, rules and procedures which all concerned persons should follow, while trading in listed or proposed to be listed securities of the Company. During the year, the Company has also adopted the Code of Practice and Procedures for Fair Disclosure of Unpublished Price Sensitive Information in line with the SEBI (Prohibition of Insider Trading) Amendment Regulations, 2018. The Code is available on the Company's website https://mconrasayan.com/investor- relation/

OTHER DISCLOSURES

During the year under review:

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

b) No equity shares were issued with differential rights as to dividend, voting or otherwise.

c) No Sweat Equity shares were issued.

d) Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India.

e) Throughout the Financial Year 2022-23, the Company did not accept any deposits from the public. Furthermore, there were no outstanding, unpaid, or unclaimed public deposits at the beginning or end of the fiscal year. It is also important to note that the Company did not violate any provisions of Chapter V (Section 73) of the Act pertaining to deposits.

f) There was no Change in nature of Business of the Company.

g) Except as disclosed in this Report, there are no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the Financial Statements relate and the date of the Report.

h) No unpaid/unclaimed dividend or any other amount was required to be transferred to the Investor Education and Protection Fund during the year under review.

i) No application was made or any proceeding were pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

j) During the period under review, there has been no one time settlement of Loan taken from Banks and Financial Institutions.

ACKNOWLEDGMENTS

Your Directors would like to express their heartfelt gratitude to the Government Authorities, Banks, Creditors and Customers for their unwavering support extended to the company throughout the year. Additionally, they would like to convey their deep appreciation to the shareholders for their trust and confidence in the company.

Furthermore, the Directors would like to commend all employees for their exceptional teamwork, professionalism, and dedicated efforts throughout the year. Their hard work and commitment have been instrumental in the company's success.

FOR AND ON BEHALF OF THE BOARD OF MCON RASAYAN INDIA LIMITED'

MAHESH BHANUSHALI

MANGING DIRECTOR DIN:07585072

DATE: 29th May 2023