Natraj Proteins Ltd

& Management Discussion and Analysis Report

To,

The Members of,

Your directors take pleasure in presenting their 33rd Annual Report along with the Audited financial statements for the year ended 31st March, 2024.

Total revenue for the year was Rs. 19402.53 Lakhs as compared to Rs.14369.28 Lakhs.

Net sales for the year were Rs. 19372.78 Lakhs as compared to Rs. 14359.72 Lakhs in the previous year.

Profit/(Loss) before tax for the year was Rs. (1246.29) Lakhs as compared to profit of Rs. 101.79 Lakhs in the previous year.

Profit/(Loss) after tax for the year was Rs. (1251.90) Lakhs as compared to Rs. 71.29 Lakhs in the previous year.

To the best our knowledge and belief and according to the information and explanations obtained by us, your Directors confirms the following statements in terms of section 134(3)(c) and 134(5) of the Companies Act, 2013:

a. that in the preparation of the annual accounts for the year ended 31st March, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. that such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied consistently. 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 and Loss of the Company as at 31st March, 2024.

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

d. that they have prepared the Annual Accounts on a "going concern" basis;

e. that they have laid down internal financial controls for the company and such internal financial controls were adequate and were operating effectively.

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

The company is primarily engaged in manufacture of soybean oil, fats and de-oiled cakes through solvent extraction process and wholesale of cereals and pulses. During the year under review, your company has also successfully established Rice Mill on 30th December, 2023 for custom milling business activities.

The paid-up Equity Share Capital as on 31st March, 2024 was Rs. 374.70 Lakhs divided into 37.47 Lakhs equity shares of Rs.10/- each. During the year under review, the Company has not issued shares with differential voting rights or granted stock options or sweat equity shares.

The entire equity shares of the company continue to remain listed on BSE Ltd. (Scrip Code: 530119). The company has paid the Annual Listing Fees to BSE Ltd. for the year 2024-25 and the Custodian fee to the CDSL and NSDL for the financial year 2023-24 on time. The shares of the Company are frequently traded at BSE Ltd.

In view of the losses suffered by the Company during the year under review your directors do not recommend any dividend for the Financial Year 2023-24 (Previous Year 2022-23: Rs. Nil) and proposes to retain the profits for future business requirements of the Company.

The company has not transferred any amount to the general reserves or any other reserves during the year 2023-24(Previous year: Nil).

Cash and cash equivalent as at 31st March, 2024 is Rs. 71.27 Lakhs (Previous year Rs. 239.58 Lakhs) The Company continues to focus on management of its working capital, receivables, and inventories. The other working capital parameters are kept under continuous monitoring.

Your Company has not accepted deposits from the public falling within the ambit of section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 and there were no remaining unclaimed deposits as on 31st March, 2024.

Further, the Company has not accepted any deposit or loans in contravention of the provisions of Chapter V of theCompanies Act, 2013 and the Rules made there under.

The Company has not provided any loans, guarantees, or provided any kind of security to any company or body corporate. However, the company has made certain investments in Mutual funds which has been disclosed in the Financial Statements attached to this report. Details of the same is not reproduced in order to avoid repetition.

There is an increase in the Soyabean cultivation area in the nearby areas and normal onset of monsoon will help crop production and lead to better quality crop in the current year which adds to the better quality of raw material available at suitable prices. The company is focusing on improving the availability of its packaged oil to tap into the growing market for packaged food products.

The branded edible oil market is expected to grow, and it is estimated that close to 75% of the total edible oil available in terms of volume is retailed as a branded product. The edible oil industry in India is shifting to branded oils, which bodes well for the organized players.

The demand for De-oiled cakes (DOC) is expected to remain subdued as growth outlook of poultry industry is flat and more and more poultry producers are using DDGS as cheaper alternative for DOC. Also, political unrest in Bangladesh will have unforeseen impact on demand.

Rice Mill custom milling business is expected to drive revenues in the milling season subject to paddy procurement by government for Public Distribution System (PDS)

Government intervention in the industry is expected to continue to play a major role.

Opportunities this year are expected to arise in the form of lower seed prices and availability in nearby AgricultureProduce Markets/Mandis. Imposition of import duties on edible oils will lead to better realizable prices of edible oil.

Increased use of alternate products of Soya DOC in poultry feed poses fresh challenges for the industry, the quantum of which will be visible as the year progresses any adverse changes in government policy will also have a negative impact on the company's business,

Many initiatives were taken to support business through organizational efficiency, process change support and various employee engagement programs which has helped the organization to achieve higher productivity level. A significant effort has also been undertaken to develop leadership as well as technical/ functional capabilities in order to meet future talent requirement.

The Company's HR processes such as hiring and on-boarding, fair & transparent performance evaluation, talent management process, workmen development process and market aligned policies are being seen as benchmark practices in the industry.

During the year under review, the following Human Resources initiatives received greater focus:

Leadership Development: As a part of Leadership Development, talented employees have been seconded to the senior leadership team to mentor them and prepare them for the next higher role.

Company is dealing in the two business segment activities i.e., Solvent Extraction including Rice Milling andCommodity Trading. Segment reporting of financial performance is done as per the requirements.

As per the requirement of New Schedule III of the Companies Act, 2013, the Key Financial Ratio is also provided inthe Financial Statements. Members are requested to view Note No. 30.

However, Return on Net worth for the year is -37.14% as compared to previous year is 1.54% and the decrease inReturn on Net worth indicates the loss incurred by the company in the current year.

g) Internal Control System and their Adequacy: The Company possesses robust internal control systems and processes that align with its size and operations. The Company has well-crafted policies and procedures that cover all significant activities, and their effectiveness is tested, including financial disclosure. Adherence to these policies and procedures is a vital component of the management review process. The internal audit processes provide greater efficiency and transparency. The Internal Auditor conducts audits in accordance with standard auditing practices and then recommends improvements to processes and procedures to ensure compliance and efficiency. The Company has established several Board Committees that are mainly composed of Independent Directors to oversee and govern the effectiveness of internal controls, as part of its corporate governance framework.

Statement made in the management discussion and analysis report as regards the expectations or predictions are forward looking statements within the meaning of applicable laws and Regulations. Actual performance may deviate from the explicit or implicit expectations.

In the preparation of the financial statements, the Company has followed the Indian Accounting Standards as notified. The significant accounting policies which are consistently applied have been set out in the Notes to the Financial Statements.

The Company will continue to focus on growing its activities with a view to have better reach and realizations. The company is planning to introduce various packaging sizes to cater to a wider range of customers. The company will lay greater stress upon developing its brand and create better visibility in the market.

The company is in the main business activities of Solvent Extraction of Soybean oil and in this industry, price is determinedby market forces including effect of monsoon and the government policies.

In view of the profits and turnover, the Company is not required to undertake CSR activity for the year 2023-24. However, the company is having unspent amount of Rs.26.98 Lakhs for the previous years unspent account out of which the company has spent Rs.19.23 Lakhs in the financial year 31/03/2024 and the remaining amount of Rs.7.75 Lakhs will be spent from the separate bank account as per applicable provision of the law. The Annual Report on CSR activities is annexed herewith as "Annexure A".

As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘Act') and Rules made thereunder, your company has constituted Internal Complaints Committees (ICC). Statement showing the number of complaints filed during the financial year and the number of complaints pending as on the end of the financial year is shown as under: -

Since, there is no complaint received during the year which is appreciable as the management of the company endeavor efforts to provide safe environment for the female employees of the company.

The Company is engaged in the business of extraction of edible oil and de-oiled cakes from Soya seeds, which is associated with the normal business risk as well as the imbalance of demand-supply of products in the Domestic and International Market.

Other than this, the Government policy, local area authority, Taxation policy, fluctuations in foreign currency rate, monsoon activities, non-availability of proper soya seeds may adversely affect the profitability of the Company. In addition to that the product is also subject to various processes and clearances, like payment of compensations, subsidies etc. as may be decided by the State Government.

Moreover, weak International Market signals are deterrent to long term strategy, hence your company is trading safely and does not want to engage in the long-term risks. Further, we are focused on reducing trade barriers.

The Board of Directors has devised systems, policies and procedures / frameworks, which are currently operational within the Company for ensuring the orderly and efficient conduct of its business, which includes adherence to Company's policies, safeguarding assets of the Company, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. In line with best practices, the Audit Committee and the Board reviews these internal control systems to ensure they remain effective and are achieving their intended purpose. Where weaknesses, if any, are identified as a result of the reviews, new procedures are put in place to strengthen controls. These controls are in turn reviewed at regular intervals.

Nothing has come to the attention of the Directors to indicate that any material breakdown in the function of these controls, procedures or systems occurred during the year under review. There have been no significant changes in the Company's internal financial controls during the year that have materially affected or are reasonably likely to materially affect its internal financial controls. There are inherent limitations to the effectiveness of any system of disclosure, controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures.

The Company has a vigil mechanism named vigil mechanism/whistle blower Policy to deal with instance of the financial fraud and mismanagement, if any. The details of the Vigil Mechanism Policy are explained in the Corporate Governance Report and annexed to the Board Report as "Annexure B" and is also posted on the website of the Company. (Link - https://natrajproteins.com/policies)

Your Company does not have any subsidiary, associate or joint venture during the year 2023-24 as well as at the beginning or closing of the financial year therefore the financial statement is prepared on standalone basis and the requirement for disclosure in the Form AOC-1 is not applicable. Further that the Company is also not an associate or holding or subsidiary company of any other company during the year 2023-24.

The Company has adequate Key Managerial Personnel's as per requirements of section 203 of the Companies Act, 2013 as well as the SEBI (LODR) Regulations, 2015. There has been no change in the key managerial personnel's during the year under review.

The Company has received necessary declaration from all the independent directors as required under section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of Independence as per the SEBI (LODR) Regulation, 2015 and the Companies Act, 2013. In the Opinion of the Board, all the independent directors fulfill the criteria of independence as required under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015. All the Independent Directors have also registered themselves with Independent Directors' Databank maintained by the IICA as per requirement of the Companies Act, 2013.

During the year under review, there were following changes in the Independent directors of the company: -

1) Cessation of office of Shri Umesh Narayan Trivedi (DIN: 00018188) and Shri Pradeep Agrawal (DIN: 05279673), as the Independent Directors of the Company w.e.f. March 31, 2024 due to completion of their second term of 5 (Five) consecutive Years.

2) Appointment of Shri Vishal Kumar (DIN: 10288687) and Shri Praneet Mishra (DIN: 10288688) as Non-Executive Additional Directors in the category of Independent Directors of the Company w.e.f. 1st September, 2023 for a First Term of 5 consecutive years till 31st August, 2028 which was confirmed by the members at their 32nd Annual General Meeting held on 30th Sept., 2023.

The Board of directors upon the recommendation of the Nomination and Remuneration Committee at their meeting held on 1st September, 2023 has appointed Shri Vishal Kumar (DIN: 10288687) and Shri Praneet Mishra (DIN: 10288688) as Non-Executive Additional Directors under the category of Independent Directors and the Board is of the opinion that all the Independent Directors so appointed by the Board carry integrity, expertise and experience as well as they are registered with the portal of IICA at the time of appointment,

The Directors have cleared the online proficiency self-assessment test as required as per the Rule 6(4) of Companies(Appointment and Qualification of Director) Rules, 2014 as amended from time to time.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Smt. Namita Sharma (DIN: 02486865), Non-Executive Women Director is liable to retire by rotation and being eligible offers herself for re-appointment.

Your Directors are proposing the following Directors for appointment/re-appointment:-

1) Shri Amit Koserwal (DIN:06823437) being the Additional Director under the category of Independent Director, upon recommendation of the Nomination & Remuneration Committee, subject to the approval of members by special resolution at the forth coming 33rd Annual General Meeting to hold office for a first term of 5 (Five) consecutive

years w.e.f. 2nd September, 2024 and he is not liable to retire by rotation.

2) Shri Kailash Chand Sharma (DIN: 00012900) being the Chairman and Managing Director, upon recommendation of the Nomination & Remuneration Committee, subject to the approval of members by special resolution at the forth coming 33rd Annual General Meeting to hold office for a term of 3 (Three) consecutive years w.e.f. 1st August, 2025 and he shall be liable to retire by rotation.

Change in Key Managerial Personnel

The Board meets at regular intervals to discuss and decide on Company/Business policy and strategy apart from other Board businesses.

The notice of Board meeting is given well in advance to all the Directors. Usually, meetings of the Board are held in Itarsi, at the Registered Office. The Agenda of the Board/Committee meetings is circulated at least a week prior to the date of the meeting. The Agenda for the Board and Committee meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision. The Board met 6 (Six) times during the Financial Year 2023-24 viz., on 1st April, 2023, 30th May, 2023, 8th August, 2023, 1st September, 2023, 3rd November, 2023 and 10th February, 2024. The maximum interval between any two consecutive meetings did not exceed 120 days.

As stipulated by the Code of Independent Directors under the Companies Act, 2013; a separate meeting of the Independent Directors of the Company was held on 3rd November, 2023 to review the performance of Non-Independent Directors (including the Chairman) and the entire Board. The Independent Directors also reviewed the quality, content and timeliness of the flow of information between the Management and the Board and its' Committees which is necessary to effectively and reasonably perform and discharge their duties.

The Board has, on the recommendation of the nomination and remuneration committee framed a nomination, remuneration and evaluation policy which lays down the criteria for identifying the persons who are qualified to be appointed as directors and, or senior management personnel of the company, along with the criteria for determination of remuneration of directors, KMP's and other employees and their evaluation and includes other matters, as prescribed under the provisions of section 178 of Companies Act, 2013 and Regulation 19 of SEBI (LODR) Regulations, 2015. The policy of the Company has been given at the website of the Company at https://natrajproteins.com/policies. The details of the same are also covered in the Corporate Governance Report forming part of this annual report.

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

COMMITTEES OF THE BOARD

Apart from the aforesaid committees under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015 the Company has also constituted Internal Complaints Committee (ICC) under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.A detailed note on the Board and its committees is provided under the Corporate Governance Report section in this report.

All Related Party Transactions (RPT) that were entered into during the Financial Year 2023-24 were on Arm's Length Basis and were in the Ordinary Course of business. No materially significant RPT made by the Company with Promoters, Directors, Key Managerial Personnel or their relatives which may have a potential conflict with the interest of the Company at large.

All RPT were approved by the Audit Committee and the Board. The RPT entered into by the company are audited. The Company has developed a RPT policy, Standard Operating Procedures for purpose of identification and monitoring of such transactions.

The policy of RPT as approved by the Board is available on the Company's website (Link - https://natrajproteins.com/policies). The company has done RPT in the ordinary course of business and which are on Arms' Length Basis and which are not material in nature and hence the requirement of Form AOC-2 is not applicable to the company.

There is no significant material orders passed by the Regulators/Courts during the year 2023-24 which would impact the going concern status of the Company and its future operations.

The Board of the company takes pleasure in stating that no such observation has been made by the Auditors in their report which needs any further explanation by the Board.

The Shareholders at their 31st Annual General Meeting (AGM) held on 24th September, 2022 had approved the appointment of M/s Bhutoria Ganesan & Co., Chartered Accountants (F.R.No.004465C), as Statutory Auditors to hold office for the period of consecutive term of 5 (five) years from the conclusion of 31st AGM till the conclusion of 36th Annual General Meeting.

The company is maintaining the Cost Records as specified by the Central Government under section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, and accordingly such accounts and records are made and maintained by the Company. Further, the cost records are also audited by M/s Yogesh Chourasia & Associates, Cost Auditors. However, The Company has already filed the Cost Audit Report for the year 2022-23 to the Central Government, which was self-explanatory and needs no comments. The Company is in process to file the Cost Audit Report for the year 2023-24.

Your directors, on the recommendation of the Audit Committee, had appointed M/s Yogesh Chourasia & Associates, (F.R. No. 000271) Cost Auditors to audit the cost accounts of the Company for the financial year 2023-24 on a remuneration of Rs. 75,000/- (plus GST). As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in General Meeting for their ratification. Accordingly, a resolution seeking Member's ratification for the remuneration payable to M/s Yogesh Chourasia & Associates, Cost Auditors is included in Item No. 4 of the Notice of the 33rd Annual General Meeting.

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 re-appointed M/s D.K. Jain & Co., Company Secretaries (F.R. No. I1995MP067500) to undertake the Secretarial Audit of the Company for the year, 2023-24. The Report of the Secretarial Audit Report in Form MR-3 is annexed as "Annexure C" of this Report.

Your Board is pleased to inform that there is no such observation made by the Auditors in their report which needs any

explanation by the Board, except that:

There were no reportable fraud to the Central Government covered under section 134(3)(ca) of the Companies Act, 2013. Further that, the auditors have not found any fraud as required to be reported by them under section 143(12) to the Central Government during the year 2023-24.

Pursuant to SEBI (LODR) Regulations, 2015, a separate report titled ‘Corporate Governance' has been attached in thisAnnual Report.

All Board members and senior management personnel have affirmed compliance with the Code of Conduct for the year2023-24. A declaration to this effect signed by the Managing Director of the Company is contained in this Annual Report.

The Managing Director and CFO have certified to the Board with regard to the financial statements and other matters as required under regulation 17(8) of the SEBI Listing Regulations, 2015. Certificate from Auditors regarding compliance of conditions of corporate governance and from Practicing Company Secretary regarding disqualification of directors is annexed with the Corporate Governance Report as "Annexure D".

The report on Corporate Governance as stipulated under Regulation 34(3) read with Schedule V of the SEBI (LODR) Regulations, 2015 along with the requisite certificate from the Practicing Company Secretary of the Company confirming compliance with the conditions of the corporate governance is appended and forms a part of this report along with the certificate of Disqualification of Directors received from Practicing Company Secretary.

Shri Kailash Chand Sharma, Managing Director and Shri Abhinandan Prajapati, Chief Financial Officer have certified that the financial statements and other matters as required under regulation 17(8), read with Part B of Schedule II of the SEBI (LODR) Regulations, 2015 are duly complied with. A copy of the certificate on the financial statements for the financial year ended 31st March, 2024 is also annexed with Corporate Governance Report.

Regulation 17(5) of the SEBI (LODR) Regulations, 2015 requires listed companies to lay down a Code of Conduct for its directors and senior management, incorporating duties of directors as laid down in the Companies Act, 2013. The Company has adopted Code of Conduct for all the directors and senior management of the Company and the same has been hosted on the website of the company https://natrajproteins.com/policies.

All the directors and senior management personnel have affirmed compliance with the Code for 2023-24. A declaration tothis effect by the Managing Director is given in this Annual Report as the "Annexure E" with this Report.

Since the company does not have any subsidiary, associates or joint venture, therefore, the requirement for ConsolidatedFinancial Statements in accordance with relevant Accounting Standards (AS) is not applicable to the Company.

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure F".

No material changes and commitments affecting the financial position of the Company occurred during the Financial Yearto which these financial statements relate and the date of report.

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31st March, 2024 is available on the Company's website at https://natrajproteins.com/announcements.

Your Company is providing E-voting facility as required under Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Amendment Rules, 2015. The ensuing 33rd AGM will be conducted through Video Conferencing/OVAM and no physical meeting will be held and your company has make necessary arrangements with CDSL to provide facility for remote e-voting and e-voting at 33rd AGM. The details regarding e-voting facility is being given with the notice of the Meeting.

Pursuant to provision of section 197(12) of Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules, 2014 and the details of Top 10 employees given in the "Annexure G".

During the year under review your Company enjoyed a cordial relationship with workers and employees at all levels.

In view of the SEBI (Prohibition of Insider Trading) Regulation, 2015 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 Trading Plan, 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 Company has made a reference to the SEBI/BSE on dated 10th August, 2022 for violation of the Regulation 9 of the SEBI (PIT) Regulation, 2015 due to involvement of Shri Arush Arora, one of the promoter by way of selling of the shares of the company during the window closure period and non-providing necessary disclosure as required under Regulation 7(2)(a) of the SEBI (PIT) Regulations, 2015. However, we are not aware about whether action was taken in this matter by the regulatory authorities.

During the year, the company has filed an application under Section 9 of Insolvency and Bankruptcy Code, 2016 being the Operational Creditor, against Khedut Agro Engineering Private Limited in the month of June, 2023 before the Adjudicating Authority, Ahmedabad Bench. The company has filed case for Rs. 215.64 Lakhs including interest amount. However, the Adjudicating Authority has rejected and disposed the said application on 20th June, 2024. The Company is seeking necessary advise to take further action by way of civil suit.

Further, the company has not filed any application u/s 10 of the Insolvency and Bankruptcy Code, 2016 as well as no otherparty has filed any application u/s 7 or 9 of the Code against the Company.

Your Directors state that during the year under review:

a) The Company has not issued shares (including sweat equity shares) to employees of the Company under anyscheme.

b) Neither the Managing Director nor the Whole-time Director receive any remuneration or commission from itssubsidiary.

c) The Company has complied with the applicable Secretarial Standards under the Companies Act, 2013.

d) Details of unclaimed dividends and equity shares transferred to the Investor Education and Protection Fundauthority have been provided as part of the Corporate Governance report.

e) Your Company has not declared and approved any Corporate Action viz buy back of securities, mergers and de-mergers, split and issue of any securities and has not failed to implement or complete the Corporate Action within prescribed timelines.

f) There were no revisions in the Financial Statement and Board's Report.

g) There is no requirement to conduct the valuation by the Bank and Valuation done at the time of one-time Settlementduring the period under review.

h) There are no voting rights exercise by any employee of the Company pursuant to section 67(3) read with the Rule16 of the Companies (Share Capital and Debenture) Rules, 2014.

Your directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.