Zenith Fibres Ltd

Dear Shareholders,

Your directors have pleasure in presenting the 35th Annual Report of Zenith Fibres Limited on the business and operations of the Company along with the Audited Financial Statements for the Financial Year ended March 31, 2024.

01. Financial Highlights:

The financial performance of the Company for the year ended March 31, 2024 is summarized below:

The Company has prepared the Financial Statements in accordance with the Companies (Indian Accounting Standards) Rules, 2015 prescribed under Section 133 of the Companies Act, 2013 ("the Act").

02. Operations Review:

During the year under review, total revenue from operations of the Company was Rs. 3428.11 Lakhs as compared to Rs. 5015.20 Lakhs in the previous year. Profit before tax was Rs. 173.43 Lakhs and Profit after Tax was Rs. 131.75 Lakhs during the year under review as against Rs. 382.36 Lakhs and Rs. 283.82 Lakhs respectively in the previous year.

The Wind Turbine generated revenue of Rs. 177.34 Lakhs during the year under review as against Rs. 185.31 Lakhs in the previous year.

03. Dividend:

Considering the Financial Results and the performance of the Company during the year under review, as compared to the previous year, the Board of Directors is pleased to recommend a dividend of Rs. 1/- (10%) per share on 39,44,136 equity shares of the face value of Rs. 10/- each for the Financial Year 2023-24.

This dividend amounting to Rs. 39.44 Lakhs is payable after declaration by the Shareholders.

04. Transfer to Reserves:

The Board of Directors have decided to retain the entire amount of profit under Retained Earnings. Accordingly, your Company has not transferred any amount to General Reserves for the year ended March 31, 2024.

05. Management Discussion and Analysis Report:

The Management Discussion and Analysis Report as required under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") is annexed herewith as

06. 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(3)(c) of the Act:

i. that in the preparation of the Annual Financial Statements for the financial year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any.

ii. they have selected such accounting policies and applied them consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the profit of the Company for the period ended on that date.

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. the annual accounts have been prepared on a going concern basis.

v. proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

vi. systems to ensure compliance with the provisions of all applicable laws were devised and in place and were adequate and operating effectively.

07. Share Capital:

During the year under review, there was no change in the paid-up share capital of the Company. The paid-up share capital of the Company stood at Rs. 3,94,41,360 consisting of 39,44,136 equity shares of Rs. 10/- each. Your Company has neither issued any shares with differential voting rights nor has granted any stock options or sweat equity.

Directors:

During the year under review, the Members of the Company at the 34th Annual General Meeting ("AGM") held on September 29, 2023, had appointed Mr. Vikram Somani (DIN: 00054310) as an Independent Director of the Company for a term of five consecutive years w.e.f October 1, 2023 and Mr. Sankarasubramanian Iyer (DIN: 10282513) as an Independent Director of the Company for a term of five consecutive years w.e.f April 1, 2024. They are persons of integrity and have the relevant expertise, experience and proficiency as required under sub-section (1) of Section 150 of the Act.

Mr. Sankarasubramanian Iyer, Independent Director (DIN: 10282513), vide his letter dated March 30, 2024 expressed his inability to join as an Independent Director of the Company w.e.f April 1, 2024 owing to his health issues due to which he is unable to devote his time to the Company and accordingly, tendered his resignation as an Independent Director w.e.f April 1, 2024.

Mr. Mukund Beriwala (DIN: 00053669) completed his second term as an Independent Director with effect from end of the day on May 28, 2024 and accordingly ceased to be Independent Director and Member of the Board of Directors of the Company. The Board of Directors place on record his deep appreciation for the wisdom, knowledge and guidance provided by him during his tenure as an Independent Director.

Appointment / Re-appointment(s):

At the 35th AGM, following appointment / re-appointments are being proposed:

a. Mr. Sanjeev Rungta, Director (DIN: 00053602), is retiring by rotation and being eligible, offers himself for re-appointment.

b. On the recommendation of Nomination and Remuneration Committee and Audit Committee, the Board of Directors has recommended the re-appointment of Mr. Sanjeev Rungta (DIN: 00053602) as a Whole Time Director & CEO designated as Executive Chairman of the Company for a further period of three years from April 1, 2025 to March 31, 2028.

c. On the recommendation of Nomination and Remuneration Committee and Audit Committee, the Board of Directors has recommended the re-appointment of Mr. Aman Rungta (DIN: 03585306) as a Whole Time Director & CFO designated as Whole Time Director Finance of the Company for a further period of three years from April 1, 2025 to March 31, 2028.

The details of the proposal for appointment / re-appointment of Mr. Sanjeev Rungta and Mr. Aman Rungta along with their brief resumes respectively are mentioned in the Explanatory Statement under Section 102 of the Act and disclosure under Regulation 36 of the SEBI Listing Regulations as annexed to the Notice of the 35th AGM.

The Board recommends the appointment / re-appointment of all the above Directors.

Key Managerial Personnel:

During the year under review, Mrs. Siddhi Shah demitted her office as the Company Secretary and Compliance Officer with effect from the close of business hours of October 14, 2023. The Board placed on record its appreciation for the valuable contribution and service rendered by her during her association with the Company.

The Board of Directors of the Company upon recommendation of Nomination and Remuneration Committee has appointed Mrs. Dharati Bhavsar as Company Secretary and Compliance Officer of the Company w.e.f. November 22, 2023. In the opinion of the Board, she possesses the requisite qualification, expertise and experience.

In terms of Section 203 of the Act, the following are the Key Managerial Personnel of the Company as on March 31, 2024:

• Mr. Sanjeev Rungta - Executive Chairman

• Mr. Aman Rungta - Whole Time Director Finance

• Mrs. Dharati Bhavsar - Company Secretary

09. Board Evaluation:

Pursuant to the provisions of the Act and SEBI Listing Regulations, the Board has carried out the annual performance evaluation of Board, the Directors including Independent Directors, individually as well as the evaluation of the working of its committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

10. Corporate Governance:

The Company is committed to maintain the highest standards of Corporate Governance and adhere to all requirements as set out by law. The report on Corporate Governance as stipulated under the SEBI Listing Regulations and the requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to this report as Annexure: 2.

11. Company?s Policy on Directors? Appointment and Remuneration:

In compliance with the requirements of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations, the Company has laid down a Nomination and Remuneration Policy which has been uploaded on the Company?s website at https://zenithfibres.com/codes-policy/.

12. Subsidiary / Joint Venture / Associate Company:

Please refer Form AOC 1 at Annexure: 3.

13. Corporate Social Responsibility (CSR):

The provisions of Section 135 of the Act relating to the Corporate Social Responsibility initiatives are currently not applicable to the Company.

14. Deposits:

The Company has not accepted deposits within the meaning of Section 73 and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 during the year and hence there were no outstanding deposits and no amount remaining unclaimed with the Company as on March 31, 2024.

15. Particulars of Loans, Guarantees, Securities or Investments:

The details of Loans, Guarantees, Securities and Investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

16. Declaration by Independent Directors:

All the Independent Directors of your Company have submitted their declarations of independence, as required, pursuant to the provisions of Section 149(7) of the Act, stating that they meet the criteria of independence, as provided in Section

149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations and are not disqualified from continuing as Independent Directors of your Company.

Further, all the Independent Directors of your Company have confirmed their registration/renewal of registration, on Independent Directors? Databank.

17. Contracts and Arrangements with Related Parties:

All related party transactions that were entered with your Company during the financial year were on arm?s length basis and in the ordinary course of the business or as approved by the Audit Committee /Board in accordance with the requirements of the Act and the SEBI Listing regulations. There were no materially significant related party transactions entered into by your Company with related party as envisaged under 188 of the Act.

Hence, the disclosure of related party transactions as required under Section 134(3)(h) of the Act in Form No. AOC 2 is not applicable to your Company. Members may refer to Note No. 36.2 of Audited Financial Statements which sets out related party disclosures pursuant to IND AS.

The policy on Related Party Transactions as approved by the Board can be accessed on the Company?s website at https:/ /zenithfibres.com/codes-policy/.

18. Audit Committee:

The Company has an Audit Committee pursuant to the requirements of the Act read with the rules framed thereunder and the SEBI Listing Regulations. The details relating to the same are given in the report on Corporate Governance forming part of this Report. All the recommendations made by the Audit Committee were accepted by the Board.

19.1 Statutory Auditors:

The present Statutory Auditors, M/s. Surendra Modiani & Associates (Firm Registration No. 126307W) were reappointed at the 33rd AGM of the Company held on September 26, 2022 for a term of 5 (five) consecutive years from the conclusion of 33rd AGM till the conclusion of the 38th AGM of the Company to be held in relation to the Financial Year ending on March 31, 2027. The Auditors have confirmed that they are not disqualified from continuing as Statutory Auditors of the Company.

The observations made by the Statutory Auditors in their report read with the relevant notes as given in the notes to the financial statement for the Financial Year ended on March 31, 2024 are self- explanatory and are devoid of any reservation, qualification or adverse remarks.

19.2 Secretarial Auditors:

The Board of Directors has appointed Mr. Upendra Shukla, Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the Financial Year 2023-24. The report of the Secretarial Auditor, in the prescribed Form No. MR-3 is annexed herewith as Annexure: 4. The Secretarial Auditor Report does not contain any qualification, reservation, disclaimer or adverse remarks.

19.3 Internal Auditors:

The Board of Directors has appointed M/s. Keyur Patel & Co., Chartered Accountants as Internal Auditors of the Company for the Financial Year 2023-24.

20. Annual Return:

In compliance with Section 92(3) and 134(3)(a) of the Act, Annual Return is uploaded on the Company?s website and can be accessed at https://zenithfibres.com/stakeholders-info/.

21. Code of Conduct:

The Board of Directors of the Company has laid down a Code of Conduct for all the Board Members and Senior Management Personnel of the Company. The Board Members and the Senior Management personnel have affirmed compliance with the code for the Financial Year 2023-24. The said Code of Conduct has been posted on the website of the Company. A declaration to this effect is annexed and forms part of this report.

22. Vigil Mechanism / Whistle Blower Policy:

Pursuant to the provisions of Section 177(9) & (10) of the Act and the applicable provisions of the SEBI Listing Regulations, a Vigil Mechanism or Whistle Blower Policy for directors and employees to report genuine concerns has been established.

The same can be accessed on the Company?s website at the link: https://zenithfibres.com/codes-policy/.

23. 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 details of the Code are available on the website of the Company. All the Directors and the Designated Employees have confirmed compliance with the Code.

24. Meetings:

The Board met 4 (four) times during the Financial Year 2023-24, the details of which are given in the Corporate Governance Report forming part of the Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Act and the SEBI Listing Regulations.

Information on the Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee and meetings of those Committees held during the year is given in the Corporate Governance Report.

25. Risk Management:

The Company has a mechanism in place to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

26. Significant and Material Orders passed by the Regulators or Courts:

There are no significant and material orders passed during the year by regulators or courts or tribunals impacting the going concern status and operations of the Company in future.

27. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company has in place the policy on Prevention of Sexual Harassment at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has constituted the Internal Complaints Committee to redress complaints received regarding sexual harassment. There were no complaints registered during the Financial Year 2023-24 under review.

28. Particulars of Employees:

The information required pursuant to Section 197(12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure: 5 of the Annual Report.

The Company has not appointed any employee(s) in receipt of remuneration exceeding the limits specified under Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

29. Industrial Relations:

The Company continued to maintain harmonious and cordial relations with its workers in all its businesses.

30. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

The particulars relating to conservation of energy, technology absorption, research & development and foreign exchange earnings and outgo in accordance with Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014 is annexed hereto as Annexure: 6 which forms part of this Annual Report.

31. Material Changes and Commitments if any, affecting the Financial Position of the Company which have occurred from the end of the Financial Year till the date of the Report:

There are no material changes and commitments, if any, affecting the financial position of the Company which have occurred from the end of the Financial Year till the date of the Report.

32. Reporting of Frauds:

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

33. Change in the Nature of Business:

There was no change in the nature of the business of the Company during the Financial Year 2023-24.

34. Internal Control Systems and their Adequacy:

The Company has a formal system of internal control testing which examines both the design effectiveness and operational effectiveness to ensure reliability of financial and operational information and all statutory / regulatory compliances. The Company has a strong monitoring and reporting process resulting in financial discipline and accountability.

35. Cost Audit:

Your Company is not required to maintain cost accounting records as specified under Section 148(1) of the Act read with the Companies (Cost Records and Audit) Rules, 2014.

36. Details of application made or any proceeding pending under Insolvency and Bankruptcy Code, 2016:

During the year under review, neither any application was made, nor any proceedings were pending under Insolvency and Bankruptcy Code, 2016.

37. Details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the banks or financial institutions along with the reasons thereof:

There was no instance of one-time settlement with any Bank or Financial Institution.

38. Business Responsibility & Sustainability Report (BRSR):

The Board of Directors of the Company hereby confirms that according to the provisions of Regulation 34(2)(f) of the SEBI Listing Regulations, the Business Responsibility & Sustainability Report (BRSR) is not mandatorily applicable to the Company for the year under review, hence not annexed with Annual Report.

39. Compliance with Secretarial Standards:

Your Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Act.

40. Acknowledgement:

The Company would like to thank all the Stakeholders, Bankers, Employees, including inter alia Suppliers, Vendors and Investors and also place on record its appreciation to all the valuable customers for their consistent unstinted support throughout the year.