Resonance Specialities Ltd

To,

The Members,

Resonance Specialties Limited

Your Directors have great pleasure in presenting 36th Annual Report and Financial Statements for the financial year ended March 31, 2025.

The financial performance of the Company for the financial year ended March 31,2025 is summarized below:

The Company does not propose to transfer any amount to the general reserves out of the profits available for appropriation.

The financial statements are prepared in accordance with the Indian Accounting Standards (Ind-AS) as prescribed under Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

CRISIL Ratings has assigned the following ratings to the Company's total bank Loan facilities of Rs. 14 crores:

Long term Rating

- CRISIL BBB-/Stable (re-affirmed)

Financial Performance and Operations Review

Sales and other income for the financial year under report amounted to Rs. 7,878.69 lacs as compared with Rs. 5,623.43 lacs for the previous year, an increase of 40.10 %.

The operations of the Company have resulted in a net profit of Rs. 656.62 lacs as compared to a net profit of Rs. 296.84 lacs in the previous financial year, a increase of 121.20%.

The Financial performance of the Company during the financial year has improved mainly due to higher sales of Di Picolinic Acid, Zinc Picolinate, 2,6 Lutidine, Pyrazinamide and Isoniazid as compared to its sales in the preceding financial years. Your Company has also increased its exports business by exploring to newer markets geographically. Increase in sales of Pyrazinamide and Isoniazid is mainly due to government tenders received by our customers.

The erratic supply of imported raw material of another major product impacted its production and sales. Otherwise, the business growth and profitability of the Company would have been even better.

Your Company is into the business of manufacturing and marketing of pyridine and pyridine derivatives, picolines and some bulk drugs. The major income derived by your Company is from manufacturing and marketing of Pyridine, Collidines and their derivatives.

The world market of Pyridine, Collidines and their derivatives and other dependent products / sub-market is valued around USD 600 millions and is growing at a CAGR of about 5%. Pyridine is segmented by types such as Pyridine, Beta picoline, Alpha picoline, Gamma picoline. Pyridine is used in several applications such as agrochemicals, Pharmaceuticals, latexes, food and allied industries. Pyridine is also used in different applications such as a solvent and as a denaturant for alcohol antifreezyl mixture, ethyl alcohol and fungicides. Pyridine is also used to manufacture vitamins, medicines, food flavouring, dyes, adhesives, pesticides, herbicides, etc. Nearly half of pyridines produced is used to produce pesticides and herbicides. The increasing usage of Pyridine in these applications is expected to drive the market for pyridine and pyridine derivatives.

The Asia-Pacific region is anticipated to be the largest market for the pyridine derivatives because of the significant share of the region in agrochemicals and pharmaceuticals market where these products are used extensively.

The Company's business module is export oriented, although the Company has many local valued customers. Our core business strategy is our positioning as an integrated Product Development Company focusing on Pyridine, Collidines and its derivatives. Resonance has proven capabilities in integrated product development. The Company has, in many of its products, successfully researched test batches at the laboratory, at pilot plant and finally at commercial scales at its manufacturing facility. Company's knowledge of organic chemistry and expertise in catalysis are key strengths that have stood by the Company through time. The Company also achieved successful results from R&D in plant processes in terms of better yields and resulting cost reduction.

The Company has a strong and established business relationship with its clients across Pharmaceuticals, Agrochemicals and Specialty Ingredients industries. The Company's manufacturing facility continue to adhere to cGMP and is ISO 9000:2015 certified.

The Company's products are also Kosher, Halal and FSSC certified.

The Company has been continuously working on its products and has achieved higher yields than in the past in many key products which played a crucial role in maintaining Company's business competitiveness by keeping material cost under control inspite of spiraling inflationary trends in the economy. The Company has also successfully reduced time cycles of larger columns by in-house methods and capabilities in many key products.

Your Company's manufacturing facility has taken a huge EHS improvement drive in the recent past and has since successfully become a zero liquid discharging unit.

The Company takes pride in innovation and excellence covering the different plant processes for reaction and distillation. The Company's in-house R&D Center is continuously working in the field of catalysis for fluidized bed and fixed bed catalytic reactions.

The Company's R&D Center at Tarapur is recognized by Department of Scientific and Industrial Research, Government of India. The Company is undertaking major projects to

develop alternate and efficient process for making pyridine based products.

Due to higher sales, income and improved margins, the financial ratios have improved, vis-a-vis, previous financial year.

Vision: To be recognized as domestic and internationally integrated specialty chemicals Company through Innovation, Quality and Competence.

Strength of RSL: The strength of RSL will always be its quality commitment to all its renowned customers and competitive prices as compared to market trend, audit clearances, quality documents, updated certification and having our own backward integration process which very few companies in India have.

Opportunities for RSL: RSL is in the process of adding many intermediates in its product list. RSL is also reaching out to its end users in many major countries with its product range after knowing the end application thoroughly.

Weakness and Threats to RSL: Lack of some raw crude from the global supply chain has hindered volumes of some of the products in the financial year under report. Ban/restriction on use of Pyridine in many countries is also a cause of concern.

At Resonance, we believe that our success is the end results of the achievement of our team. The Company's performance metrics are clearly defined and for real achievers the Company offers an accelerated career growth unhindered by any hierarchy. Resonance offers a merit led environment where talent is respected and achievements are rewarded. Our management structure allows genuine appreciation of good work and the Company believes in delegating responsibilities.

We continuously empower our team members to better themselves and offer clear career paths for advancement. The Company takes extreme pride in its greatest resource and asset - the employees. Our constant endeavors have been towards encouraging a culture of employee recognition and motivation and we are able to achieve this through well designed policies and processes like rewards and recognition and other various employee benefit schemes. We ensure that there is full adherence to the code of business conduct and fair business practices by all our employees.

All safety and protective apparels are provided to the employees working in our manufacturing set-up. Regular safety training is also provided to all employees. External professional experts were hired to work with managers to create easy-to understand safety procedures, protocols and training.

The Company has an adequate internal control system including suitable monitoring procedures commensurate with its size and the nature of the business. The internal control systems provide for all documented policies, guidelines, authorisation and approval procedures. The statutory auditors while conducting the statutory audit, review and evaluate the internal controls and their observations are discussed with the Audit Committee of the Board.

The statements in the Management Discussion and Analysis Report describing the Company's objectives, projections, estimates, expectations may be 'Forward looking statements' within the meaning of the applicable laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference of the Company's operations include economic demand/supply and price conditions in the domestic and overseas markets for Company's products, changes in the Government regulations, tax laws, other statutes and incidental factors.

No material changes or commitments affecting the financial position of the Company have occurred between the end of the financial year to which financial statements in this report relate and the date of this report.

The paid-up equity share capital of the Company as at March 31, 2025 is Rs. 1154.40 lacs. The Company currently has no outstanding shares issued with differential rights, sweat equity or ESOS.

The Company has no subsidiary or joint venture companies. During the financial year under report, no company has become / ceased to be subsidiary or Joint Venture Company.

During the year under report, the Company has spent an amount of Rs. 14.99 lacs as R&D expenditure (0.19% of the turnover) as against Rs. 18.80 lacs spent in the previous financial year (0.34% of the turnover).

Your Directors are pleased to recommend an equity dividend of Rs. 1/- per share (10%) for the financial year under report. The dividend amounting to 115.44 lacs, if approved at the ensuing Annual General Meeting will be appropriated out of the profits of the year and will be paid on or before August 29, 2025.

The Company has transferred to the Investors Education and Protection Fund (IEPF) all the unpaid dividend amount required to be so transferred on or before the due date for such transfer. The Company shall also transfer to IEPF, such of the Company's equity shares in respect of which the dividend declared has not been paid or claimed for seven consecutive years.

The details of the unpaid / unclaimed dividend for the last seven financial years are available on the website of the Company (https://www.resonancesl.com/reports/2021/Data% 20for%20transfer%20to%20IEPF.pdf).

Mr. Prashant Godha, Non-Executive Director retires by rotation at the ensuing Annual General Meeting and, being eligible, offers himself for re-appointment.

Mrs. Archana Yadav, Mr. Raj Kamal Prasad Verma and Mr. Ajay Patadia who are independent directors have submitted declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations and there has been no change in the circumstances which may affect their status as independent directors during the year.

None of the directors of the Company are debarred from holding the office of Director by virtue of any SEBI order or order by any other competent authority.

In the opinion of the Board, the independent directors possess appropriate balance of skills, experience and knowledge, as required.

A brief note on Director retiring by rotation and eligible for re-appointment is furnished in the Report on Corporate Governance, annexed herewith.

During the financial year under report, the following persons were the Key Managerial Personnel of the Company.

The Nomination and Remuneration Committee has laid down the criteria for Directors' appointment and remuneration including criteria for determining qualifications, positive attributes and independence of a Director. The following attributes/criteria for selection have been laid by the Board on the recommendation of the Committee:

• the candidate should posses the positive attributes such as leadership, entrepreneurship, industrialist, business advisor or such other attributes which in the opinion of the Committee the candidate possess and are in the interest of the Company;

• the candidate should be free from any disqualifications as provided under Sections 164 and 167 of the Companies Act, 2013;

• the candidate should meet the conditions of being independent as stipulated under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 in case of appointment as an independent director; and

• the candidate should posses appropriate educational qualification, skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, technical operations, infrastructure, medical, social service, professional teaching or such other areas or disciplines which are relevant for the Company's business.

The Nomination and Remuneration Committee lays down the criteria for performance evaluation of independent directors, Board of Directors and Committees of the Board. The criteria for performance evaluation is based on the various parameters like attendance and participation at meetings of the Board and Committees thereof, contribution to strategic decision making, review of risk assessment and risk mitigation, review of financial statements, business performance and contribution to the enhancement of brand image of the Company.

The Board has carried out evaluation of its own performance as well as that of the Committees of the Board and all the Directors.

All the Independent Directors of the Company have registered their names in the database maintained by Indian Institute of Corporate Affairs, Manesar, Haryana. The Independent Directors who are not otherwise exempted have also cleared common proficiency test conducted by the said institute within the prescribed time.

The objective and broad framework of the Company's Remuneration Policy is to consider and determine the remuneration, based on the fundamental principles of payment for performance, potential and growth. The Remuneration Policy reflects on certain guiding principles of the Company such as aligning remuneration with the longer term interests of the Company and its shareholders, promoting a culture of meritocracy and creating a linkage to corporate and individual performance and emphasising on line expertise and market competitiveness so as to attract the talent. The Nomination and Remuneration Committee recommends the remuneration of Directors and Key Managerial Personnel, which is approved by the Board of Directors, subject to the approval of shareholders, where necessary. The level and composition of remuneration shall be reasonable and sufficient to attract, retain and motivate the directors, key managerial personnel and other employees of the quality required to run the Company successfully. The relationship of remuneration to performance should be clear and meet appropriate performance benchmarks. The remuneration to directors, key managerial personnel and senior management personnel should also involve a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goals. The Remuneration Policy is placed on the Company's website at (https://www.resonancesl.com/ reports/2017/REMUNERATION%20POLICY%20OF%20 DIRECTORS.pdf).

Information about elements of remuneration package of individual directors is provided in the Corporate Governance Report which is annexed.

Details of the familiarisation program of independent directors are disclosed on the website of the Company (https:// www.resonancesl.com/reports/2024/Familiarisation%20 Programme 2023-24.pdf)

This information has been furnished under Report on Corporate Governance, which is annexed.

There have been no instances of fraud reported by the Statutory Auditors under Section 143 (12) of the Act and Rules framed thereunder either to the Company or to the Central Government.

Your Directors confirm that:

(a) In the preparation of the annual accounts for the Financial Year ended March 31, 2025, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(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 your Company as at March 31, 2025 and of its profit for the year ended on that date;

(c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

(d) The Directors have prepared the annual accounts for the Financial Year ended on March 31, 2025 on a going concern basis;

(e) The Directors have laid down internal financial controls to be followed by your Company and that such internal financial controls are adequate and were operating effectively.

(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.

As per the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has complied with the requirements of Corporate Governance in all material aspects.

A report on Corporate Governance (Annexure 1) together with a certificate of its compliance from the Practising Company Secretary, forms part of this report.

Your Company has not accepted any deposits from the public during the year under review and as such no amount of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

Details of the Audit Committee along with its constitution and other details are provided in the Report on Corporate Governance.

M/s. Kailash Chand Jain and Co., Chartered Accountants (Firm Registration No. 112318W) are the Statutory Auditors of the Company who are appointed from the conclusion of the 32nd Annual General Meeting and till the conclusion of the 37th Annual General Meeting.

The Auditors' Report for the financial year ended March 31, 2025 read with the notes to the accounts referred to therein are self-explanatory and therefore, do not call for any further comments. There are no qualifications, reservations or adverse remarks made by the Auditors.

Pursuant to the provisions of Section 148 of the Companies Act, 2013, M/s. Poddar & Associates, Cost Accountants (Firm Registration. No. 001819) were appointed as the Cost Auditors to conduct audit of cost records of the Company for the financial year 2024-25.

The Company has maintained the cost accounts and cost records as specified by the Central Government under subsection (1) of Section 148 of the Companies Act, 2013.

The Cost Audit Report for the financial year 2023-24 has been filed by the Company on August 20, 2024 and within the due date.

Pursuant to the provisions of Section 204 and other applicable provisions, if any, of the Companies Act, 2013, M/s. Alok Khairwar & Associates, Practising Company Secretaries were appointed as the Secretarial Auditors for auditing the secretarial records of the Company for the financial year F.Y. 2024-25

The Secretarial Auditors' Report is annexed hereto. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditors.

The Company is committed to good corporate citizenship. As a part of its corporate social responsibility, the Company continues to undertake a range of activities including healthcare and education to improve living conditions of the needy people. The CSR policy of the Company is placed on the website of the Company (https://resonancesl.com/reports/2020/CSR%20 Policv.pdf).

During the year under report, the Company has supported healthcare and educational projects undertaken by a charitable institution having CSR registration.

In accordance with the provisions of Section 135 of the Companies Act, 2013, an abstract on Company's CSR activities is furnished as Annexure 2 to this report.

The Company considers safety, environment and health as the management responsibility. Regular employee training programmes are carried out in the manufacturing facility on safety and environment.

The Company has not given any loans or guarantees or made investments in contravention of the provisions of the Section 186 of the Companies Act, 2013. The details of the loans and guarantees given and investments made by the Company are provided in the notes to the financial statements.

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of Company's business.

The Board has approved a policy for related party transactions which has been uploaded on the website of the Company (https://resonancesl.com/reports/2020/Revised%20 Related%20Party%20Transaction-RSL%20(2).pdf).

All the related party transactions are placed before the Audit Committee as well as the Board for approval on a quarterly basis. Omnibus approval was also obtained from the Audit Committee on an annual basis for repetitive transactions. Approval of the shareholders is also obtained, wherever necessary, in this regard.

Related party transactions are disclosed in the notes to the financial statements. Prescribed Form No. AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 is furnished as Annexure 3 to this report.

The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration and other details as set out in the said rules are provided as an Annexure 4 in this annual report. The Company had no employee drawing remuneration in excess of the amount as mentioned under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

However, having regard to the provisions of the first proviso to Section 136(1) of the Act and as advised, the Annual Report excluding the aforesaid information under Explanation (2) to the above Rule is being sent to the members of the Company. The said information is available for inspection at the registered office of the Company during working hours excluding Saturdays and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

The Board has laid down a code of conduct for Board members and senior management personnel of the Company. The code also incorporates the duties of independent directors as laid down in the Companies Act, 2013. The said code of conduct is posted on Company's website at https://resonancesl.com/ reports/2020/Revised%20Related%20Party%20Transaction- RSL%20(2).pdf.

The Board members and senior management personnel have affirmed compliance with the said code of conduct. A declaration signed by the Wholetime Director / CFO is given at the end of this Report.

There is a Whistle Blower Policy in the Company and no personnel has been denied access to the Chairman of the Audit Committee. The policy provides for adequate safeguards against victimization of persons who use vigil mechanism. The Whistle Blowing Policy is posted on the website of

the Company at (https://resonancesl.com/reports/2020/ Revised%20Whisler%20Blower%20Policy.pdf)

The Company has adopted a Code of Prevention of Insider Trading based on the SEBI (Prohibition of Insider Trading) Regulations, 2015. The same has been placed on the website of the Company at (https://www.resonancesl.com/ reports/2019/Code%20of%20Conduct% 20on%20Insider%20 Trading%20Policv.pdf).

All the Directors, senior management employees and other employees who have access to the unpublished price sensitive information of the Company are governed by this code. During the year under Report, there has been due compliance with the said code of conduct for prevention of insider trading.

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition &Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year, no complaint has been received.

There are no significant or material orders passed by any regulator, tribunal or court that would impact the going concern status of the Company and its future operations.

In accordance with the requirements of Section 134 of the Companies Act, 2013, statement showing particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo is furnished as Annexure 5 to this report.

In accordance with the requirements of Section 92 (3) of the Companies Act, 2013 and Rule 12 (1) of the Companies (Management and Administration) Rules, 2014, copy of Annual Return in Form MGT-7 is placed on the website of the Company at the following web link https://www.resonancesl. com/reports/2025/ANNUAL%20RETURN%202024-25.pdf.

The Company has complied with all the applicable Secretarial Standards.

Your Directors place on record their appreciation for the continued co-operation and support extended to the Company by the bankers. Your Directors also thank the trade and consumers for their patronage of the Company's products. Your Directors also place on record their profound admiration and sincere appreciation of the continued hard work put in by employees at all levels.