Thangamayil Jewellery Ltd

To the Members of Thangamayil Jewellery Limited

The Directors are pleased to present the 24th Annual Report and the Audited Statement of Accounts for the year ended 31 st March 2024:

1) FINANCIAL RESULTS

'in Lakhs

The year 2023-24 started well with the resounding success on "Akshaya Thrithiyai" sales that fell in the first quarter that already supported by better realisation due to steep increase in gold price movement. However, second quarter was a sagging one with respect to bottom line impact due to fall in recovery due to gold price adverse behaviour. However, 3rd and 4th quarters, the company could register the progress made earlier that resulted in the record performance in 2023-24.

The retail turnover was its highest level and all products portfolio performed well. Pre-covid level performance was restored fully.

The company could manage to reach an all-time high with respect to turnover at ' 3,82,678 lakhs as against ' 3,15,255 lakhs of last year. The profit after tax was a record one at ' 12,324 lakhs as against ' 7,974 lakhs in 2022-23. The quantum jump in PAT is attributed to the following factors:

• Retail volume driven growth at 11 %

• Contribution to bottom line on full performance of retail outlets started in previous year

• Improved contribution from non-gold items

• Better working capital management along with marginal improvement in stock turnaround

• SSS (Same stores Sales) improved by 23% that had positive impact on cost efficient delivery aspects

• Above all, better revenue realisation in value addition due to better gold price prevailed in better part of the year;

• The aggregate financial positive impact is felt in the PAT improvement by '4,351 lakhs compared to previous year. It is also pertinent to note that the company could sustain the gross profit margin at 9.64% on the significantly increased turnover in spite of very challenging price sensitive eco system.

Expansi?n of outlets

During the year, the company started outlets in Ooty, Coimbatore-Ganapathy, Tirumangalam, Melur, Kumbakonam, Hosur, Silwear Smile Showroom at Madurai, and Rameshwaram.

It has also elevated Manamadurai, Sattur and Bodi TMJL plus smaller outlets to regular retail outlets based on their respective performance.

Meanwhile, due to economic and visibility reasons and with a view to utilize the costly working capital sources to cover better performing branches, the company closed its operations in Eral, Uslampatti and Kayalpattanam.

The impairment of assets amounting to ' 166 lakhs is fully provided in the financial results.

Current year 2024-25

The current year 2024-25 started well. In the past 49 days (01.04.24 to 19.05.24) the company achieved a turnover of '62,202 lakhs as against ' 47,255 lakhs in the similar period in the previous year ended 31st March 2024. It is heartening to note that in the current year "Akshaya Thrithiyai" sales improved to ' 15,728 lakhs as against ' 10,856 lakhs in the last year and registered a value growth of 45%. Moreover in volume terms also gold ornaments sold were at 210 kgs as against 168 kgs in the last year and registered a volume growth of 25% . This growth in volume is achieved in spite of gold price increase by 20%.

For the ongoing financial year, our Board has planned opening of 8 mid level retail outlets already identified with that of one flagship Chennai outlet totalling 9 outlets.

The estimated cost (Capex plus working capital) amounting to '40,000 lakhs is to be financed by

a) unused working capital limits upto ' 17,500 lakhs.

(b) incremental customer advances on a recurring basis upto ' 12,500 lakhs and

(c) a part of internal accruals upto ' 10,000 lakhs aggregating to ' 40,000 lakhs.

The Capex portion is estimated to be at ' 4,000 lakhs to be spent on interiors and other movable assets. All our outlets under contemplation are based on lease properties with an "asset less" model in place.

Performance of existing outlets

Almost all retail outlets are EBITDA positive. Post amortisation of head office expenses three out of 58 outlets are marginally incurring losses. However, in the overall context those outlets are smaller ones and by and large makes no difference to the corporate performance.

You may observe that our top line growth increased on a five year period at CAGR (Compounded Annual Growth Rate) at 23 %

It is also heartening to note that service cum small outlets have registered a total turnover of '88.23 Crs in 202324. Out of 13 "TMJ Plus" outlets 3 are elevated to branch category and 2 closed and the remaining are performing well.

2) DIVIDEND

The Board of Directors at their meeting held on 20th May, 2024, has recommended payment of ' 6 (Rupees six only) (60%) per equity share of the face value of ' 10 (Rupee ten only) each as final dividend for the financial year ended 31 st March, 2024. The payment of final dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company. The board had already paid an interim dividend of ' 4/- on 1 st February 2024 to all eligible shareholders as on that date. The company allocated pay out of ' 2,744 lakhs for 2023-24 on the expanded capital resulted on account of 1:1 bonus share allotted during this year as against '1,646 lakhs nearly 67% improvement in overall dividend payout. Refer Annexure 1 for Dividend Distribution policy.

3) SHARE CAPITAL

The Company's paid up capital increased to ' 2,744 lakhs consists of 274 lakhs numbers of shares of face value of ' 10 each resulted due to issue of bonus shares in the ratio of 1:1 as against ' 1,372 lakhs in the last year.

4) HEDGING

The company has got a well-defined operative "Hedging" mechanism in place. The metal loan availed from banks and the advances received from customers for future delivery objectives are covered under a natural hedge against gold price fluctuations. A portion of other inventories is also hedged with MCX platform by paying margin and meeting day-to-day MTM (marked to market) obligations.

This is done based on daily sales criteria. In aggregate, the hedging is at 89% as against 76% of last year. You may note that in the last five years, the hedging portion is progressively improved. We are fully committed to hedging in the prevailing volatility in gold price behavior. The company is fully confident on sustaining the operating profit and does not depend on any inventory profits / (losses.)

5) FINANCE

For the required working capital for the current year based on the estimates done, the company is fully supported by various sources of finance.

The secured working capital outstanding borrowings of the company as of 31 st March 2024 stood at '32,444 lakhs as against '37,331 lakhs of the previous year. The aggregate working capital facilities from multiple banking arrangement is at '51,100 lakhs. The current drawing power covers the sanctioned limits fully.

The eligible fixed deposits limit from public & shareholders is at '13,607 lakhs. However, the company took only '9,042 lakhs. Besides, the promoters unsecured loan at 6% interest of '3,379 lakhs continues in the system. Interest outflows have increased marginally due to better utilization of working capital borrowings. At the same time per gram interest outgo reduced from '66 to '65 Moreover, the average cost of funds in aggregate for borrowings has dropped from 5.30% to 4.82% in spite of increase in interest rates upto 250bps by the banks.

6) CONTINUING CHALLENGES

a) Rapid increase in gold price may affect volume offtake at some point of time in future.

b) Due to highly working capital intensive model, PAT less Dividend payouts may not be sufficient to support the growth momentum

c) Other discretionary items having a levergable potential may downsize the gold as a saving instrument.

d) High degree of competitive intensity prevailing in the eco system

e) Compulsion to grow in a large sized industry requires huge advertisement and publicity spends without a realistic measurement of success matrix.

7) FUTURE PROSPECTS

• Sustainable gross profit margin with a marginal positive bias will be maintained but on a larger top line growth

• Better amortization of fixed overheads on enlarged retail outlets

• Continue to grow with "asset less" business model on a calibrated scale

• To consistently increase ROE (Return on Equity) over a longer period of time

• Optimum utilization of brand equity created

• High level of liquidity to support any opportunity that may arise.

• High level of penetration of technology support to the operations

Except for unforeseen circumstances, the management is confident of performing on the areas prioritized.

8) DEFERRED TAX ASSETS

The company as per Ind AS requirements has created deferred tax assets ' 250 lakhs as against deferred tax assets of ' 238 lakhs of previous year.

The company has recognised provision for Income tax for the year ended and measured its deferred tax basis the rate prescribed in the Act.

9) CONTRIBUTION TO EXCHEQUER

The Company is a regular payer of taxes and other duties to the Government. The Company has paid GST of ' 11,563 lakhs as compared to ' 9,495 lakhs paid in the previous year and the Income tax amounts to ' 4,188 lakhs was paid as against ' 2,693 lakhs for financial year 2023-24.

10) CAPITAL EXPENDITURE

During the year, we capitalized '3,657 Lakhs to our gross block comprising '3,350 lakhs for Plant & Machinery, Building, Furniture & Fittings and other assets and balance of '307 lakhs for Computer Equipment's including Software.

The capital work in progress amount outstanding as on 31 st March 2024 is '236 lakhs (previous year '160 lakhs). This comprises of interiors and other assets still to be put in use and are yet to be capitalised.

For the previous year, we capitalized '3,703 lakhs to our gross block comprising '3,504 lakhs for Plant & Machinery and Furniture & Fittings and others and the balance of '199 lakhs for Computer Equipment's including Software.

11) DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12)

OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act,2013 including any statutory modification(s) or re-enactment(s) for the time being in force.

12) DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(5) of the Companies Act, 2013:

a) In the preparation of the annual accounts, the applicable accounting standards had been followed and there is no material departure.

b) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for the year;

c) The directors have 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 have prepared the annual accounts on a 'going concern' basis;

e) The directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating

effectively. Internal financial control means the policies and procedures adopted by the Company 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 the accounting records and the timely preparation of reliable financial information; and

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

13) MANUFACTURING FACILITIES

Utilisation of own manufacturing facilities including on job work basis is around 75% as against 71% of the earlier years. The overall cost of production has come down due to attainment of scale of economies in the manufacturing facilities. It is expected to improve the own manufacturing capacity utilisation in forthcoming years. On a need basis, at short notice, handmade items capacity could be enlarged.

14) DEPOSITORY SYSTEM

The trading in the Equity Shares of your Company is under compulsory dematerialization mode. As on March 31, 2024, Equity Shares representing 100% of the equity share capital are in dematerialized form. As the depository system offers numerous advantages, members are requested to take advantage of the same and avail of the facility of dematerialization of the Company's shares.

15) CORPORATE GOVERNANCE

Your Company has been practising the principles of good corporate governance over the years and lays strong emphasis on transparency, accountability and integrity.

A separate section on Corporate Governance and a certif?cate from the statutory auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Regulation 27 of SEBI (LODR) 2015 of the Listing Agreement(s) with the Stock Exchange(s) forms part of this report.

The Chairman and Managing Director and Joint Managing Directors of the Company have certified to the Board on financial statements and other matters in accordance with Regulation 17 (8) of SEBI (LODR) 2015 of the listing agreement pertaining to CEO certification for the financial year ended 31 st March 2024.

16) INDEPENDENT DIRECTORS

M/s. S.Rethinavelu, Lalji Vora & V.R.Muthu - Independent Directors of the company are completing their terms of office as per the Companies act, 2013. Hence they retire

from their office with effect from forthcoming AGM on 25th July, 2024.

In their place the Board has recommended for the appointment of M/S. N.Jegatheesan & K.Thirupathi Rajan as Independent Directors of the company to the Shareholders and on their consent they will be appointed with effect from 25th July , 2024 in terms of Companies Act, 2013.

With the above changes the Board of Directors will comprise of 8 total number of Directors out of which 4 will be Independent Directors (50%) thus fulfilling the requirement of the companies act, 2013 and SEBI(LODR) , 2015. Therefore the composition of Board of Directors will be in accordance with the requirements of the act and regulations.

1) Re-constitution of various committees with effect from 25th July 2024:

Due to change in the independent directors as three of them are completing their term and retire from their office and two new Independent Directors are inducted into the Board to fulfil the requirements following changes have been effected in the constitution of various committees:

a. Audit committee members:

1) Mr. S.M.Chandrasekaran (Chairman)

2) Mr. N.Jegatheesan

3) Mrs. Rajakumari Jeevagan

4) Mr. Ba.Ramesh

b. Nomination and remuneration committee

members:

1) Mr.S.M.Chandrasekaran (Chairman)

2) Mr.N.Jegatheesan

3) Mrs.Rajakumari Jeevagan

4) Mr.Balarama Govinda Das

c. Corporate Social Responsibility committee members:

1) Mr.Balarama Govinda Das (Chairman)

2) Mr.Ba.Ramesh

3) N.B.Kumar

4) Mr.S.M.Chandrasekaran

d. Stakeholders & Grievances Committee members:

1) Mr.S.M.Chandrasekaran (Chairman)

2) Mr.Balarama Govinda Das

3) Mr.Ba.Ramesh

4) N.B.Kumar

e) Risk Management Committee Members:

1) Mr.Balarama Govinda Das (Chairman)

2) Mr.Ba.Ramesh

3) N.B.Kumar

4) Mr.S.M.Chandrasekaran

5) Mr.K.Thirupathi Rajan

17) DISCLOSURE REQUIREMENTS

As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors' Certif?cate thereon, and the integrated Management Discussion and Analysis including the Business Responsibility Report are attached, which forms part of this report.

18) LISTING OF SHARES

The Equity Shares of your Company continue to remain listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. The listing fees for the year 2024-25 have been paid to these Stock Exchanges. The Shares of the companies are compulsorily tradable in dematerialized form.

19) INSURANCE

The assets of the Company are adequately insured against fire and such other risks, as are considered necessary by the Management.

20) HUMAN RESOURCE DEVELOPMENT

Many initiatives have been taken to support business through organizational efficiency, development, resourcing, performance & compensation management, competency- based development, career & succession planning and organization building. Leadership development is one of the primary key initiatives of the Company. Primary personal development program has been taken up as long term strategy of the Company. A significant effort has also been undertaken to develop leadership as well as administrative / functional capabilities in order to meet future talent requirement.

The Company continues to maintain pleasant relations without any interruption in work. As on 31st March 2024 the Company has 2,112 employees on its rolls as against 1,799 employees in the previous year.

21) PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

In terms of the provision of Section 197(12) of Act read with rules 5(2) and 5(3) of the Companies ( Appointment and Remuneration of Managerial personnel) Rules, 2014 a

statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report.

Disclosures 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 provided in the Annexure -2.

Having regard to the provision of the first proviso to Section 136(1) of the Act and as advised, the Annual Report, excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the corporate office of the Company during working hours and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The full Annual Report including the aforesaid information is being sent electronically to all those members who have registered their main addresses and is available on the Company's website.

22) STATEMENT CONCERNING DEVELOPMENT

AND IMPLEMENTATION OF RISK

MANAGEMENT POLICY OF THE COMPANY

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & under regulation 21 of the SEBI (Listing obligations and disclosure requirements) Regulations, 2015, the company has adopted risk management policies to monitor the business.

Business Risk Evaluation and Management (BRM) is an on- going process within the Organization. The Company has a robust risk management framework to identify, monitor and minimize risks as also identify business opportunities.

The objectives and scope of the Risk Management

Committee broadly reviews:

1. Overseeing of risk management performed by the executive management;

2. The BRM policy and framework formulated in line with local legal requirements and SEBI guidelines;

3. Risks and evaluate treatment including initiating mitigation actions and ownership as per a pre-defined cycle;

4. Defining framework for identification, assessment, monitoring, and mitigation and reporting of risks.

5. Within its overall scope as aforesaid, the Company shall review risks trends, exposure, and potential impact analysis and mitigation plan.

23) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

INFORMATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 134 (3)(M) OF THE COMPANIES ACT, 2013 READ WITH RULE 8(3) OF THE COMPANIES RULES, 2014.

a) Conservation of Energy

The disclosure of particulars with respect to conservation of energy pursuant to Section 134 (3) (m) of the Companies Act, 2013 read with rule 8(3) of the companies (accounts) rules, 2014 are not applicable as our business is not specified in the Schedule. However, the company makes its best efforts to conserve energy in a more efflcient and effective manner.

b) Technology Absorption, Adaptation and Innovation

The company has not carried out any specific research and development activities. The company uses indigenous technology for its operations. Accordingly, the information related to technology absorption, adaptation and innovation is reported to be NIL.

c) Foreign Exchange Earning and Outgo

Foreign Exchange Earning (' in lakhs)

Foreign Exchange Outgo

24) ESTABLISHED PROCESS OF MITIGATING RISKS IN TMJL

The Risk management process at TMJL revolves around identification of all risks of internal and external and undertaking risk mitigation measures so that monitoring their impact would be process driven with a view to take corrective course of actions.

Industry Risk

Jewellery industry dominated by gold metal in India and is going through a shrinking phase in the discretionary context of customers priorities for purchases together with wide gold price movements. Business is shifting from unorganized sector to corporates with deep pockets of resources to sustain the cyclical risk impact.

Your company enlarged its wings in semi and rural areas where the existing business is shifting to organized players like us. The shrinking size risk is mitigated by adding value added products in the portfolio and also by selling other popular brands under our umbrella

Regulatory Risk

The Government has implemented more stringent regulatory measures in all aspects of the trade starting from compliances under various Acts including Income tax and customer friendly Hallmarking, etc., in a speedier manner.

Your company has already adapted to the changes in the trade requirements and in fact would be a beneficiary under GST regulations.

Commodity Risk

Gold being a commodity, price is influenced by various factors including demand and supply. Even though we buy gold whenever we sell on the same day, in order not to carry the risk of price fluctuations, the underlying stock on a given date certainly affected by the price movement. The impact of it either positive or negative often shadowed the real operating capabilities of the company. Your company has an inbuilt hedging mechanism to mitigate the extreme fluctuations in gold price movement. Currently we maintain 89:11 ratio between hedged and un-hedged closing stock inventory. This strategy helped us to maintain our performance, besides ensuring liquidity in the system.

Every aspect, of the risks components mentioned in the earlier paras, were carefully evaluated by the respective teams and reported to Board at intervals to reset the strategies and policies that may tend to be appropriate and re-assuring in the changed realities.

Cost Risk

The brand building and establishment cost increased in recent years due to growth aspirations. New business can be identified by enhancing the visibility of the Brand. It involves a huge cost on a recurring basis even though the positive impact could be seen in later years.

Your Company by taking into advantages of low cost retailer tag has already spent larger sums for advertisement and publicity. This will go a long way in expanding the retail outlets in larger parts of Tamilnadu and the cost currently incurred would be amortized among larger number of retail outlets in the days to come.

Growth Risk

The industry suffers from the introduction of sovereign gold bond and also by the penetration of "E-commerce" activity in the trade. New territorial expansion often results

in burning cash in the form of excessive fixed cost in the earlier years anticipating a sustainable business later that is not guaranteed.

Your Company though strategically decided to grow but restricted its inroads into current territorial places in a deeper and concentrated manner so that fixed cost impact will not be felt by the company as an adverse factor. We opt for Asset less model and therefore the risk of growth in unknown places is mitigated to that extent.

Financial risk

Stretched financials could hamper business sustainability. The Company's gearing as at 31st March 2024 stood at 1.15 times which is among one of the best in the target corporates of the industry.

The company is consistently reducing its high-cost debts and leverage only when it is self-liquidating in nature. All the financial indicators are improving including risk weighted Return on Equity.

However, all our retails outlets expansion plan is going forward smoothly. Our learning out of first wave of Covid has helped us to rearrange resources and improve our operating efficiencies.

25) INTERNAL CONTROL SYSTEMS

The Board of Directors is responsible for ensuring that internal financial controls have been laid down in the Company and that such controls are adequate and is functioning effectively. TMJL has policies, procedures, control frameworks and management systems in place that map into the definition of Internal Financial Controls as detailed in the Companies Act, 2013. These have been established at the entity and process levels and are designed to ensure compliance to internal control requirements, regulatory compliance, and appropriate recording of financial and operational information.

Internal Financial Controls that encompass the policies, processes, and monitoring systems for assessing and mitigating operational, financial and compliance risks and controls over related party transactions, substantially exist. The management reviews and certifies the effectiveness of the internal control mechanism over financial reporting, adherence to the code of conduct and Company's policies for which they are responsible and also the compliance to established procedures relating to financial or commercial transactions, where they have a personal interest or potential conflict of interest, if any.

The Audit Division continuously monitors the efficacy of Internal Financial Controls with the objective of providing to the Audit Committee and the Board of Directors, an independent, objective and reasonable assurance on

the adequacy and effectiveness of the organisation's risk management, control and governance processes. The audit plan is approved by the Audit Committee, which reviews compliance to the plan.

During the year, the Audit Committee met regularly to review reports submitted by the Audit Division. All significant audit observations and follow-up actions thereon were reported to the Audit Committee.

The Audit Committee also met the Company's Statutory Auditors to ascertain their views on financial statements, including the financial reporting system, compliance to accounting policies and procedures, the adequacy and effectiveness of the internal controls and systems followed by the Company. The Management acted upon the observations and suggestions of the Audit Committee.

26) Details Of Policy Developed And Implemented

By The Company On Its Corporate Social

Responsibility Initiatives (CSR)

During the financial year ended 31st March, 2024, the Company incurred CSR Expenditure of ' 185 Lakhs (Rupees One Hundred Eighty Five lakhs Only). The CSR initiatives of the Company were under the thrust area of health & hygiene, education, water management and vocational training. The CSR Policy of the Company is available on the website of the Company.

The Company's CSR Policy statement and annual report on the CSR activities undertaken during the financial year ended 31 st March, 2024, in accordance with Section 135 of the Act and Companies (Corporate Social Responsibility Policy) Rules, 2014 is set out in Annexure 3 to this report.

CORPORATE GOVERNANCE REPORT AND BUSINESS RESPONSIBILITY REPORT

In compliance with Regulation 34 of the Listing Regulations, a separate report on Corporate Governance along with a certif?cate from the Auditors on its compliance and a Business Responsibility Report as per Regulation 34 of the Listing Regulations, detailing the various initiatives taken by the Company on the environmental, social and Governance front forms part of this Annual Report.

27) PARTICULARS OF LOANS, GUARANTEES OR

INVESTMENTS MADE UNDER SECTION 186

OF THE COMPANIES ACT, 2013

There were no loans & guarantees given or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review.

Particulars of contracts or arrangements with related parties referred to in Section 188(1)

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. 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. All Related Party Transactions are placed before the Audit Committee as also in the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are foreseen and repetitive in nature. The transactions entered pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The Annual Report on related party is annexed herewith as "Annexure 4".

28) COMPANY'S POLICY RELATING TO DIRECTORS

APPOINTMENT, PAYMENT OF REMUNERATION

AND DISCHARGE OF THEIR DUTIES

The Company's Policy relating to appointment of Directors, payment of Managerial remuneration, Directors' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure -5 and is attached to this report.

29) ANNUAL RETURN

The Annual Return of the Company as on 31st March, 2024 in Form MGT - 7 in accordance with Section 92(3) of the Act read with the Companies (Management and Administration) Rules, 2014, is available on the Company's website- www. thangamayil.com.

30) NUMBER OF BOARD MEETINGS CONDUCTED

DURING THE YEAR UNDER REVIEW

During the year, Nine Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

31) SUBSIDIARIES, JOINTVENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint venture or Associate Company.

32) DEPOSITS

The details of deposits remain unpaid during the year under review are furnished hereunder:

33) DIRECTORS

Smt. Yamuna Vasini Deva Dasi Non - executive and Non - Independent Director of the Company retires by rotation and being eligible seeks reappointment. Your Board recommends her re-appointment.

34) DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfil all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

The Details of familiarisation programme arranged for independent directors have been disclosed on website of the company and are available at www.thangamayil.com.

35) CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviours of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct" which forms an Appendix to the Code. The Code has been posted on the Company's website www.thangamayil.com. The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance through examples on the expected behaviour from an employee in a given situation and the reporting structure.

All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All

Management Staff were given appropriate training in this regard.

36) STATUTORY AUDITORS

M/s. B.Thiagarajan & Co., Chartered Accountants (ICAI Registration No.: 004371S) were appointed as Statutory Auditors of the Company, at the 22nd AGM held on 4th August 2022 to hold office till the conclusi?n of the 27th AGM. M/s. B.Thiagarajan & Co., has confirmed that they are not disqualified from continuing as Auditors of the Company.

The Report given by M/s. B.Thiagarajan & Co., Chartered Accountants on the financial statement of the Company for the financial year 2023-2024 is part of the Annual Report. The Notes on financial statement referred to in the Auditor's Report are self-explanatory and do not call for any further comments. The Auditor's Report does not contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the Auditors had not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.

37) SECRETARIALAUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr.S .Muthuraju, a Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is annexed herewith as "Annexure 6".

38) COMMENTS ON AUDITORS' REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. B.Thiagarajan & Co., Statutory Auditors, in their report and by Mr. S. Muthuraju , Company Secretary in Practice, in his secretarial audit report.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

39) INTERNAL AUDIT AND CONTROL SYSTEMS

The company has an effective in-house internal audit system. The persons are well trained to cover various areas of verification inspection and system evaluation. All the mandatory compliances required to be followed under various statutes are exhaustively covered in their scope. We have effective and adequate internal audit and control systems, commensurate with our business size. Regular internal audit visits to the operations are undertaken to ensure that high standards of internal controls are maintained at each level. Independence of the

audit and compliance function is ensured by the auditors' direct reporting to the Audit Committee. Details on the composition and functions of the Audit Committee can be found in the chapter on Corporate Governance of the Annual Report.

40) SIGNIFICANT AND MATERIAL ORDERS PASSED

BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

41) ENHANCING STAKEHOLDERSVALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company's operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to create value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

42) PREVENTION OF SEXUAL HARASSMENTAT WORKPLACE

The Company has a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of women at workplace and matters connected therewith or incidental thereto covering all the aspects as required under the "The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013. There were no such complaints received under the policy during the year.

43) DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM

Pursuant to the provisions of the Companies Act, 2013 and under regulation 25 of the SEBI (Listing obligations and disclosure requirements) Regulations, 2015, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

The Audit Committee consists of the following members

a. Mr.S.Rethinavelu - Chairman

b. Mr.V.R.Muthu - Member

c. Mr.Ba.Ramesh - Member

The above composition of the Audit Committee consists of independent Directors viz., Mr. S.Rethinavelu and Mr.V.R.Muthu who form the majority.

The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of Company employees and the Company.

44) ANNUAL EVALUATION BY THE BOARD

The evaluation framework for assessing the performance of Directors Comprises the following key areas:

1. Attendance of Board Meeting and Board Committee Meetings

2. Quality of Contribution to Board deliberations

3. Strategic perspectives or inputs regarding future growth of Company and its performance

4. Providing perspectives and feedback going beyond information provided by the management

5. Commitment to shareholders and other stakeholder interests

The evaluation involves self-evaluation by the Board Members and subsequently assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/ her evaluation.

45) PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. All Directors and the designated employees have confirmed compliance with the Code. The same has been displayed at the company's website at www.thangamayil.com.

46) SHARES

a. Buy Back of Securities

The Company has not bought back any of its securities during the year under review.

b. Sweat equity

The Company has not issued any Sweat Equity Shares during the year under review.

c. Bonus shares

During the year company has issued 1,37,19,582 fully paid up bonus equity shares of Rs. 10/- each in the ratio of 1( one) equity share of Rs. 10 each for every 1 (one) existing equity shares of Rs. 10 each and same was approved by shareholders in the AGM held on July 5, 2023.

d. Employees Stock Option Plan

The Company has not provided any Stock Option Scheme to the employees.

47) FORWARD-LOOKING STATEMENTS

Statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include domestic demand and demand and supply conditions affecting selling prices , input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

48) ACKNOWLEDGEMENTS

The Board of Directors place on record sincere gratitude and appreciation for all the employees at all levels for their hard work, team spirit, cooperation and dedication during the year.

Your Directors place on record their sincere thanks to bankers, suppliers, business associates, consultants, and various Government Authorities for their continued support extended to your Company's activities during the year under review. Your Directors also acknowledge greatfully the shareholders for their support and confidence reposed on the Company.