Spencers Retail Ltd

Dear Members,

The Board of Directors ("Board") takes great pleasure in presenting the Seventh Annual Report on the business and operations of the Company together with the Audited Financial Statements of the Company for the financial year ended March 31, 2024.

FINANCIAL HIGHLIGHTS

In compliance with the provisions of the Companies Act, 2013 ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), as amended from time to time, the Company has prepared its standalone and consolidated financial statements as per Indian Accounting Standards ('Ind AS') for the Financial Year 2023-24. The financial performance for the year ended March 31, 2024 is as follows:

(Rs in Lakhs)

The financial results and the results of operations, including major developments have been further discussed in detail in the Management Discussion and Analysis Report.

MANAGEMENT DISCUSSION AND ANALYSIS

In compliance with Regulation 34 of the SEBI Listing Regulations, a separate section on the Management Discussion and Analysis, which includes details review of operations, performance and future outlook of the Company, is annexed hereto and forming part of this Report as Annexure-A.

DIVIDEND

In view of the accumulated losses, the Board of Directors of the Company do not recommend any dividend for the financial year ended on March 31, 2024.

Dividend Distribution Policy of the Company, as required under the SEBI Listing Regulations has been uploaded on the website of the Company and can be accessed at http://www.spencersretaii.com/investor

CORPORATE GOVERNANCE

The Company is committed to focus on long term value creation and protecting stakeholders' interest by applying proper care, skiii and diiigence to business decisions and adhering to the SEBI Listing Reguiations and to foiiow and impiement best practices in Corporate Governance in letter and spirit.

In compliance with Regulation 34 read with Schedule V of the SEBI Listing Regulations, a Report on Corporate Governance for the year under review is annexed as Annexure-B aiongwith Additional Shareholders Information as Annexure-C to this Report.

A certificate from Mr. S.M. Gupta of M/s. S.M. Gupta & Co., Company Secretaries, the Secretarial Auditors of the Company confirming the compliance with the conditions of Corporate Governance, as stipulated under the SEBI Listing Regulations, is annexed to the Corporate Governance report.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return as on March 31, 2024 is available on the website of the Company and can be accessed at http://www.spencersretaii.com/investor

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

As a part of succession planning and since Mr. Shashwat Goenka is overseeing business operations of the Company, Dr. Sanjiv Goenka (DIN: 00074796) stepped down from the position of Chairman and Director of the Company with effect from close of business hours on May 22, 2023. Consequently, the Board of Directors at its meeting held on May 22, 2023 has unanimously approved the appointment of Mr. Shashwat Goenka as the Chairman of the Company w.e.f. May 23, 2023.

In terms of the provisions of Section 152 of the Act read with Article 100 of the Articles of Association of the Company, Mr. Anuj Singh (DIN: 09547776), Director of the Company, will retire by rotation at the ensuing AGM and, being eligible, offers himself for re-appointment. The Board of Directors on the recommendation of the Nomination and Remuneration Committee (NRC), has recommended his re-appointment.

During the year, Mr. Debanjan Mandal (DIN: 00469622) has been re-appointed as an Independent Director of the Company, not liable to retire by rotation, for a second term of five years, from February 11, 2024 to February 10, 2029. The NRC of the Company had evaluated the performance of Mr. Debanjan Mandal and found it to be satisfactory and in view of his performance and based on the recommendation of NRC and Board, members of the Company has approved the said re- appointment on March 10, 2024 through Postal Ballot / E-Voting.

Further, Mr. Rahul Nayak has stepped down from the position of Whole-time Director as well as from the directorship of the Company w.e.f. May 18, 2024 due to his personal reasons and to pursue his career outside the Company. Necessary disclosures as required under Regulation 30 of SEBI Listing Regulations were made to the Stock Exchanges where the shares of the Company are listed in this regard.

In the opinion of the Board, all the directors possess the requisite qualifications, experience and expertise and hold high standards of integrity. All the Independent Directors are exempt from the requirement of passing the proficiency test. The Company has received necessary disclosures/declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence prescribed under the Act and the SEBI Listing Regulations. In terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, Independent Directors of the Company have registered their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

The list of key skills, expertise and core competencies of the Board are provided in the Report on Corporate Governance forming part of this report.

During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees received by them.

Change in Key Managerial Personnel (KMP)

Mr. Neelesh Bothra, Chief Financial Officer of the Company stepped down from the position of Chief Financial Officer and KMP of the Company due to his personal reasons and was relieved from the services w.e.f January 20, 2024 (after the closing of the business hours). Mr. Sandeep Kumar Banka was appointed as the Chief Financial Officer of the Company with effect from April 18, 2024. Necessary disclosures have been filed with the Stock Exchanges, wherein the shares of the Company are listed in this regard.

NUMBER OF MEETINGS OF BOARD OF DIRECTORS

During the year under review, four Board meetings were held, the details of which are given in the Corporate Governance Report which forms part of this Report.

SHARE CAPITAL

During the year under review there has been no change in the authorised, issued, subscribed and paid up equity share capital of the Company.

The equity shares of the Company are continued to be listed on BSE Limited ('BSE') and on National Stock Exchange of India Limited ('NSE'). The Company has paid the requisite listing fees to the Stock Exchanges for the financial year 2024-25.

PUBLIC DEPOSITS

During the year under review, the Company has not accepted any deposits from Public / Members under Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 and no such amount of Principal or interest was outstanding as on the date of the Financial Statements.

STATUTORY AUDITORS AND AUDITORS' REPORT

As per the requirement of Section 139(2) of the Act, M/s. S.R. Batliboi & Co. LLP, Chartered Accountants (Firm Registration No. 301003E / E300005), were appointed as the Statutory Auditors of the Company for a term of five consecutive years at the third Annual General Meeting of the Company.

The Auditors' Report on the Financial Statements of the Company for the year under review does not contain any qualification(s), reservation(s) or adverse remark(s). No fraud has been reported by the Auditors to the Audit Committee of the Company or to the Board. The Notes to Financial Statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT

The Board had appointed Mr. S.M Gupta of M/s. S. M. Gupta & Co., Company Secretaries, as the Secretarial Auditors of your Company to conduct Secretarial Audit of the Company for the financial year 2023-24.

Secretarial audit of secretarial and related records of the Company were conducted by the aforesaid Secretarial Auditors and a copy of the Secretarial Audit Report is annexed to this Report as Annexure-D. Secretarial Audit Report of Natures Basket Limited, the material unlisted subsidiary of the Company, is also attached to the Report as Annexure-Dl.

None of the above Secretarial Audit Reports contain any qualification(s), reservation(s) or adverse remark(s).

SECRETARIAL STANDARDS

During the year under review, the Company has complied with all the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs, Govt. of India, relating to Meetings of the Board of Directors and General Meeting(s).

RELATED-PARTY TRANSACTIONS

All contracts / arrangements / transactions entered into by the Company with related parties during the financial year were in accordance with the provisions of the Companies Act, 2013 and the SEBI Listing Regulations. All such contracts or arrangements were executed in the ordinary course of business and at an arm's length basis and pre-approved by the Audit Committee of the Board. During the year, the Company had not entered into any contract / arrangement / transaction with any related party having potential conflict with the interests of the Company and which could be considered materially significant. Hence, the disclosure of Related Party Transactions (RPT) (in Form AOC-2) as required under Section 134(3)(h) of the Act is not applicable to the Company for the financial year 2023-24.

The Policy on materiality of RPT and on dealing with RPT as approved by the Board, is available on the Company's website and can be accessed at http://www.spencersretail.com/investor.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the financial year under review, the Company has complied with the provisions of Section 186 of the Act, with respect to loans given, investments made and guarantee/comfort provided etc. and details thereof are given in the notes to the financial statements.

COMMITTEES OF THE BOARD

The Board has constituted following statutory Committees according to their respective roles and defined scope:

1) Audit Committee,

2) Nomination and Remuneration Committee,

3) Stakeholders' Relationship Committee,

4) Corporate Social Responsibility Committee

5) Risk Management Committee

Details of the composition, terms of reference and number of meetings held for respective committees are given in the Report on Corporate Governance.

The various Committees of the Board focus on specific areas and make informed decisions in accordance with the relevant regulatory requirements and terms of reference.

CODE OF CONDUCT

The Company has adopted a Code of Conduct for its Directors and senior management personnel and the same can be accessed at http://www.spencersretaii.com/investor.

All Directors and senior management personnel have affirmed compliances with the Code of Conduct and Ethics for Directors and Senior Management.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Sections 134 (3)(c) and 134(5) of the Act, your Directors, to the best of their knowledge and belief, confirm that:

a) i n the preparation of the accounts for the financial year ended March 31, 2024, the applicable Indian accounting standards have been followed along with proper explanation relating to material departures, if any;

b) appropriate accounting policies have been selected and applied consistently and judgments 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 at the end of the financial year and of the loss of the Company for the period;

c) proper and sufficient care has been taken for the maintenance of 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 and during the year under review, neither the statutory auditors nor the secretarial auditors reported to the Audit Committee of the Board, any instances of fraud committed against the Company by its officers or employees.

d) the annual account have been prepared on a going concern basis;

e) internal financial controls laid down by the directors have been followed by the Company and that such internal financial controls were adequate and operating effectively and;

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

BOARD EVALUATION

In order to ensure that the Board and Board Committees are functioning effectively and to comply with the statutory requirements, the annual performance evaluation of the Board, Board Committees and Individual directors were conducted during the year. The evaluation was carried out based on the criterion and framework approved by the NRC. A detailed disclosure on the parameters and the process of Board evaluation as weii as the outcome has been provided in the Report on Corporate Governance.

INDEPENDENT DIRECTORS MEETING

The Independent Directors of your Company met on February 1, 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 of the Board and the Board as a whole aiongwith the performance of the Chairman of the Company 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.

CRITERIA ON BOARD DIVERSITY AND DIRECTOR ATTRIBUTES AND REMUNERATION POLICY FOR DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES

The Company recognizes the importance of a diverse Board in its success and believe that a truly diverse Board will leverage differences in thought, perspective, industry experience, knowledge and skills including expertise in financial, global business, leadership, technology, and other domains, wiii ensure that Company retains its competitive advantage.

In terms of the provisions of Section 178(3) of the Act and Regulation 19 read with Part D of Schedule II to the SEBI Listing Regulations, NRC is authorized / empowered for determining qualification, positive attributes and independence of a Director. Additional details on Board diversity are available in the Corporate Governance that forms part of this Report. The NRC is also empowered for recommending to the Board, a policy relating to the remuneration of the Directors, Key Managerial Personnel and other employees. The Company has devised inter-aiia the Remuneration Policy and the same can be accessed on the Company's website at https://www.spencersretaii.com/investor

RISK MANAGEMENT

Your Board has formed a Risk Management Committee to frame, implement and monitor the risk management plan of the Company. The Committee has been entrusted with the responsibility to assist the Board in a) overseeing, monitor and review the risk management plan and ensuring its effectiveness. b) ensuring that all material Strategic and Commercial including Cybersecurity, Safety and Operations, Compliance, Control and Financial risks have been identified and assessed and c) ensuring that all adequate risk mitigations are in place, to address these risks. The Audit Committee has additional oversight in the area of financial risks and controls. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

CORPORATE SOCIAL RESPONSIBILITY

In accordance with Section 135 of the Act and the Rules made thereunder, the Company has formulated a Corporate Social Responsibility Policy, a brief outline of which along with the required disclosures are annexed as Annexure-E as a part of this Report. No amount was required to be spent by the Company on CSR activities as per Section 135 of the Act during the financial year as the Company had incurred continuous losses in the past.

The aforesaid CSR Policy has also been uploaded on the Company's website and may be accessed at http://www. spencersretail.com/investor.

VIGIL MECHANISM / WHISTLEBLOWER POLICY

Pursuant to the guidelines laid down under Section 177 of the Act, and the Rules made thereunder read with the SEBI Listing Regulations, the Company has a Whistleblower Policy (Vigil Mechanism) in place for reporting any actual or potential concerns pertaining to any instances of irregularity, unethical practice and / or misconduct. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairman of the Audit Committee of the Company through Company Secretary, for redressal of any irregularity, unethical practice and/or misconduct. No person has been denied access to the Chairman of the Audit Committee and there was no such reporting during the financial year 2023-24.

The aforesaid CSR Policy has also been uploaded on the Company's website and may be accessed at https://www. spencersretail.com/investor.

ANTI-SEXUAL HARASSMENT POLICY

The Company is committed to provide a safe and conducive work environment to all its employees and associates and has zero tolerance towards sexual harassment at work place. The Company has a policy on Prevention of Sexual Harassment at Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Adequate workshops and awareness programmes against sexual harassment are conducted across the organisation. The Company has constituted an Internal Committee(s) (ICs) to redress and resolve any complaints arising under the Prevention of Sexual Harassment Act (POSH). Training / awareness programmes are conducted throughout the year to create sensitivity towards ensuring respectable workplace.

Details of complaints received / disposed during the Financial Year 2023-24 are provided in the Report on Corporate Governance. Further there was no complaint pending as on March 31, 2024.

SUBSIDIARIES

As on March 31, 2024, the Company has two wholly-owned subsidiaries, Natures Basket Limited (NBL) and Omnipresent Retail India Private Limited (ORIPL). Natures Basket Limited is the material subsidiary of the Company.

In terms of the provisions of Regulation 24(1) of the SEBI Listing Regulations, appointment of Independent Director of the Company on the Board of material Subsidiaries is not applicable to NBL.

The Company has formulated a Policy for determining Material Subsidiaries. The Policy is available on the Company's website and can be accessed at https://www.spencersretail.com/investor.

The Company has prepared consolidated financial statements for the Company and its Subsidiaries in the form and manner which is in compliance with the applicable Indian Accounting Standards and the SEBI Listing Regulations and the same has been audited by M/s. S. R. Batliboi & Co. LLP, Chartered Accountants, the Statutory Auditors of the Company.

The consolidated financial statements for the financial year 2023-24 forms a part of the Annual Report and shall be laid before the Members of the Company at the ensuing AGM while laying its standalone financial statements. Further, the Auditors Reports of Subsidiaries do not contain any qualifications, remarks or disclaimer. Pursuant to the provisions of Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing the salient features of the Financial Statements of the Company's Subsidiaries in Form AOC-1 is attached to the consolidated Financial Statements of the Company.

Furthermore, pursuant to the provisions of Section 136 of the Act, the Financial Statements of the Company, consolidated Financial Statements along with relevant documents and separate Audited Financial Statements in respect of subsidiaries are available on the website of the Company at https://www.spencersretaii.com/investor. Shareholders desirous of obtaining the Audited Financial Statements of the Company's Subsidiaries may obtain by requesting the same.

COST RECORDS

The provisions of Section 148 of the Act pertaining to cost audit and maintenance of cost records are not applicable to the Company.

EMPLOYEE STOCK OPTION

Your Company has formulated Spencer's Retail Limited Employee Stock Option Plan 2019 ('ESOP Scheme') for benefit of its employees as per applicable regulations of Securities and Exchange Board of India (SEBI) as amended from time to time and the said schemes are in compliance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as appiicabie.

The purpose of above ESOP Scheme is to provide the employees with an additional incentive in the form of options to receive the equity shares of the Company at a future date.

The Company aims to reward its employees for their continuous hard work, dedication and support through ESOP The main objective of the ESOP Scheme is to recognise employees who are performing weii, a certain minimum opportunity to gain from your Company's performance thereby acting as a retention tool and to attract best talent available in the market. 1,20,000 options have been granted tiii date under the Employee Stock Option (ESOP), 2019 Scheme and is being implemented through a trust viz. Spencer's Employee Benefit Trust ("Trust") in accordance with the provisions of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and involves the secondary market acquisition of the Company's equity shares by the Trust through the Stock Exchanges.

Details with respect to employee stock options under the ESOP Scheme as on March 31, 2024 are provided in the table below:

A certificate from M/s. S.M Gupta & Co, Secretarial Auditors of the Company, with respect to the implementation of the Company's Employee Stock Option Scheme(s), would be kept at the ensuing Annual General Meeting of the Company for inspection of the Members.

AWARDS AND RECOGNITIONS

The Company has been a proud recipient of numerous awards and recognitions during the financiai year 2023-24. The significant ones among them are iisted hereunder:

1. Award was given to Spencer's Retail in the Retailers Brand Category recognising its efforts in curating unique and high quality Private Brands fostering Health, driving Innovation and Excellence in the Contract Manufacturing and Private Labei sector.

2. "Images Excellence Award for Quick Commerce Execution" under "Coca Coia Golden Spoon Awards 2023".

3. "Modern Trade Partnership Award, 2023" under "Catch Spice Icon".

4. "Global Marketing Excellence Awards" held on November 23, 2023 at Taj Lands End, Mumbai.

5. Direct Marketing campaign of the Year" award under "Global Awards for Retail Excellence" conducted by Asia Retail Congress.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments, affecting the financial position of the Company that have occurred between the close of the financial year ended on March 31, 2024 and the date of this Board's Report.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY ANY REGULATORS, COURTS AND TRIBUNALS

No significant and material order has been passed by any Regulator(s), Court(s) and Tribunal(s) impacting the going concern status and the Company's operations in future.

CORPORATE INSOLVENCY RESOLUTION PROCESS INITIATED UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (IBC)

There are no proceedings, initiated by any Financial Creditor or Operational Creditor or by the Company, under the Insolvency and Bankruptcy Code, 2016 as amended, before National Company Law Tribunal or other courts during the financial year 2023-24.

CHANGE IN THE NATURE OF BUSINESS

During the year under review, there was no change in the nature of the business of the Company.

INTERNAL FINANCIAL CONTROL (IFC) AND THEIR ADEQUACY

The Company maintains adequate internal control systems, policies and procedures for ensuring orderly and efficient conduct of the business, including adherence to the Company's policies, safeguard of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures in all areas of its operations. The services of internal and external auditors are sought from time to time. The Company believes that it has sound internal control systems commensurate with the nature and size of its business. The Company continuously upgrades these systems in line with best-in-class practices.

The reports and deviations are regularly discussed with the Management and actions are taken, whenever necessary. The Audit Committee of the Board periodically reviews the adequacy of the internal control systems.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under sub-section (3)(m) of Section 134 of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed hereto and forms part of this Report (Annexure-F).

PARTICULARS OF EMPLOYEES

As required under the provisions of Section 197 of the Act and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, particulars of the concerned employees forms a part of this Report. However, as per the provisions of Section 136(1) of the Act, the Annual Report and Financial Statements are being sent to all the members of the Company excluding the aforesaid information. The said statement is also available for inspection by the shareholders at the Registered Office of the Company during business hours on working days of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company through email at spencers.secretarial@rpsg.in. The same will be replied by the Company suitably.

None of the employees listed in the said Annexure are related to any Director of the Company.

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed hereto and forms part of this Report (Annexure-G).

INDUSTRIAL RELATIONS

Industrial relations in the Company continued to be cordial during the year. A detailed section on the Company's Human Resource initiatives is forming part of the Management Discussion & Analysis annexed to this Report.

INTEGRATED REPORT

The Company has voluntarily provided Integrated Report, which encompasses both financial and non-financial information to enable the Members to take well-informed decisions and have a better understanding of the Company's long-term perspective. The Report also touches upon aspects such as organization's strategy, governance framework, performance and prospects of value creation based on the five forms of capital viz. financial capital, intellectual capital, human capital, social capital and natural capital.

GREEN INITIATIVES

Pursuant to the relevant circulars issued by Ministry of Corporate Affairs (MCA), Government of India and Securities & Exchange Board of India (SEBI), Notice of the Seventh AGM and the Annual Report of the Company for the financial year 2023-24, are being sent to the Members only by email.

The Company supports the 'Green Initiative' undertaken by the MCA, enabling electronic delivery of documents including Annual Report etc. to Members at their e-mail address already registered with the Depository Participants ("DPs") and Registrar and Transfer Agent ("RTA"). Additionally, the Company conducts various meetings by means of electronic mode in order to ensure the reduction of carbon footprint.

In view of the above, shareholders who have not yet registered their email addresses are requested to register the same with their DPs/ the Company's RTA for receiving all communications, including Annual Report, Notices, Circulars etc. from the Company electronically.

ACKNOWLEDGEMENTS

Your Directors wishes to place on record their appreciation for the valuable services rendered by the employees of the Company, across levels. The Directors would also like to express their appreciation to the bankers, the regulatory authorities, the trade suppliers, the customers, the financial institutions and the shareholders for their continued support and cooperation.