<dhhead-BOARD'S REPORT</dhhead-

Dear Members,

Your Company's Directors are pleased to present this Annual Report on the business performance and operations of the Company along with the audited financial statements of United Breweries Limited ('UBL' or 'we' or 'your Company' or 'the Company') for the financial year ended March 31, 2024 ('the year under review', 'the year' or 'FY24').

Management Summary

FY24 has been a tale of two halves with the first quarter impacted by RTM changes and supply challenges while the remainder of the year showed recovery momentum in our business. We are delighted to present the following highlights:

• Our flagship brand Kingfisher delivered the highest-ever volume and revenue in FY24, supported by a packed calendar that tapped into its existing iconic associations as well as new campaigns.

• In the second half of 2023, Kingfisher launched a new campaign '#NoFilterFriendships' that focused on meaningful connections without the fear of being judged.

• Kingfisher also renewed its association with FC_Goa to leverage the passion Goa has for football and its team. The association was activated at multiple touchpoints across Goa.

• Kingfisher Ultra witnessed great growth momentum in volume, value, and brand equity, driven specifically by Kingfisher Ultra Max. The brand expanded its draught portfolio by launching Kingfisher Ultra Max draught in Karnataka.

• Our latest innovation Queenfisher celebrate sisterhood through a new brew ad campaign, developed by an all-women team and was launched in Goa on International Women's Day.

• The Company also expanded its brand London Pilsner at Karnataka providing an upgrade option from economy beers.

• Heineken took pride in bringing Heineken Silver Draught Beer to India, setting a new standard in the world of premium beer, and continuing the legacy of Heineken's exceptional brewing heritage.

• Heineken Silver experienced significant growth momentum throughout 2023, particularly in focus markets of Maharashtra and Goa, and was activated

through various campaigns such as Heineken 150 years, and UEFA Champions League, offering unique consumer experiences.

• As we implemented the second year of our Brew a Better India (BaBI) strategy, your Company actively built momentum to deliver on our sustainability ambitions. Our Sustainability Report annexed to this report, gives a comprehensive overview of this strategy, our performance, and the strides we have made in driving a positive change this year.

Other highlights for the period

• Volume growth of 1.8% with broad-based growth across our footprint. The Premium segment grew close to 3%.

• Net sales grew 8% with volume growth, supported by pricing and state-mix effects.

• Gross Margin declined close to 38 bps though Q4 FY24 is up 312 bps vs the previous year driven by revenue management & cost initiatives & EBIT grew 23% or around 80 bps as fixed cost leverage is partially mitigating the negative gross margin development.

• Capex investment of H190 crore in breweries and commercial assets to meet volume growth.

• The Board proposes a dividend of H 10 per Equity Share, representing circa 65% payout of profit after tax.

Through BaBI strategy your Company is boldly raising the bar on sustainability. We recognise the importance of minimising our environmental footprint and this year 78.8% of our total energy came from renewable sources. Your Company also purchased International Renewable Energy Certification (I-REC) for 90 GWh units. We see this as a temporary step towards meeting our renewable energy targets and a means to signal market demand for renewable infrastructure. Our freshwater consumption for the year was 2.93 hl/hl and we were 90.64% waste to landfill-free.

Your Company will accelerate focus on robust innovations to solidify its market leadership and will further strive for appropriate price increase approvals in combination with other revenue management initiatives. Overall, your Company continues to remain optimistic about the long-term growth potential of the industry, driven by increasing disposable income, favorable demographics, and premiumization. Together with HEINEKEN we are well poised to shape the future of the Indian beer market.

BREWING THE GOOD TIMES FINANCIAL SUMMARY

Financial performance for the year ended March 31, 2024, is summarized below:

1. Return on Equity Ratio: Improvement in ratio from 7.69 to 10.06 driven by increase in profits compared to previous year.

2. Debt-equity Ratio: This ratio increased majorly due to utilisation of working capital facility at the year end to meet the duty requirements on account of increased sales.

3. Debt service coverage Ratio: Improvement on account of increase in profits compared to previous year.

4. Return on Investment Ratio: Increase in interest income on account of surplus funds parked in short term deposits is the major contributor to the improved ratio

The financial statements for the year ended March 31, 2024, have been prepared under Indian Accounting Standards ("Ind AS") according to notification by the Ministry of Corporate Affairs under the Companies (Indian Accounting Standards) Rules, 2015, as amended.

The Company generated Net turnover growth of 8.3% vs the previous year. The Gross turnover for FY24 stood at H183,722 million which grew by 10.3%. Your Company achieved a Net turnover of H81,154 million during FY24 as against H74,917 million during FY23. EBITDA for the year under review stood at H7,679 million as compared to H6,635 million in the previous year, increased by 15.73% over the previous year. Profit before taxation for the year stood at H5,493 million. Profit after taxation stood at H 4,094 million.

DIVIDEND

We take pleasure in proposing a dividend of H10 per Equity Share of H1 each for the year ended March 31, 2024 subject to the approval of the Shareholders at the ensuing Annual General Meeting ("AGM") of the Company to be held on August 01, 2024. The total dividend is H2,644 million, which amounts to about 65% of the Profit after Tax. The dividend declared for the previous year was H7.50 per Equity Share of H1 each.

TRANSFER TO RESERVES

The Company does not propose to transfer any amount to

CAPITAL

The Authorized Share Capital of the Company stands at H9,990 million, comprising Equity Share Capital of H4,130 million and Preference Share Capital of H5,860 million. The Issued, Subscribed, and Paid-up Equity Share Capital of the Company as on March 31, 2024, remains unchanged at H264.4 million comprising 26,44,05,149 Equity Shares of H1 each.

MANAGEMENT DISCUSSION AND ANALYSIS Industry Overview

Beer is one of the world's oldest beverages, possibly dating back to the 6th millennium BC. It's a drink which has brought people together for centuries and is immensely popular across the world. In India too, it is one of the key alcoholic beverages of choice. This is a situation where, unlike other emerging economies, the beer industry is highly regulated with high taxation.

Beer comprises around 10% of total alcohol consumed in India*. Compared to the global average of around 30 liters of beer consumption per capita (PCC), the PCC in India still hovers at only around 2 liters. However, in recent years, India has witnessed a notable transformation in its beer industry, propelled by changing consumer preferences, evolving regulatory landscapes, and increasing disposable incomes.

Beer in India can be categorized into Strong and Mild Beers. Also, like many other categories in India, with rising disposable income and aspiration there is a strong trend of premiumization. Premium beer is expected to grow at a faster pace than the overall category*.

The Indian beer industry stands at a pivotal juncture, poised for sustained growth and innovation. Despite challenges, the market presents abundant opportunities for players willing to navigate regulatory complexities, embrace innovation, and align with evolving consumer preferences. The beer category continues to be in a strong place and your Company with its powerful brands and market-leading position is well poised to not only take advantage of the opportunity but also to shape & grow the overall category.

Sales and Marketing

Our flagship brand Kingfisher delivered the highest-ever volume and revenue in FY24, supported by a packed calendar that tapped into its existing iconic associations as well as new campaigns. The brand continued its association with Varun Dhawan and Rashmika Mandanna through the successful 'Spread the Cheer' campaign. We leveraged this campaign during the IPL season and in addition also associated with Lucknow Super Giants to connect with our consumer's number on passion point. The brand also entered the flavored beer category through the launch of its new innovative mango draught beer. This was distributed via select modern on-trade outlets in the state of Karnataka.

In the second half of 2023, Kingfisher launched a new campaign '#NoFilterFriendships' that focused on meaningful connections without the fear of being judged. Kingfisher strengthened its' connection with young consumers by tapping into their passion for Gaming through a year-long association with Kingfisher India Premiership, India's largest gaming tournament. Kingfisher also renewed its association with FC_Goa to leverage the passion Goa has for football and its team. The association was activated at multiple touchpoints across Goa.

The brand also tapped into music in a significant way through a renewed association with Sunburn, the largest music festival in India. A special edition Sunburn pack was a big hit amongst consumers coming to Goa. With some of the biggest artists in the EDM space, the Sunburn and Kingfisher association was much talked about among music lovers.

Our latest innovation Queenfisher celebrates sisterhood through a new brew and campaign, developed by an all-women team and was launched in Goa on International Women's Day. The initial response has been very encouraging. We also expanded London Pilsner to Karnataka with the objective of providing an upgrade option from economy beers.

Kingfisher Ultra witnessed great growth momentum, driven specifically by Kingfisher Ultra Max. The brand expanded its draught portfolio by launching Kingfisher Ultra Max draught in Karnataka. In premium bars and retail stores across India,

it has offered multiple exciting consumer activations. It has garnered much love and appreciation by consumers and customers alike.

Over the year, the brand partnered with upcoming and popular music festivals like Zomaland, Anjunadeep, Dunk Fest, Odd Ball, and Kappa CULTR Festival which generated trials for the brand and helped embed the brand in popular culture. The brand's music IP 'Soulflyp' scaled up significantly last year with over 40+ events across the major cities and partnered with trending national and international dance music artists.

Heineken Silver experienced significant growth momentum throughout 2023, particularly in focus markets of Maharashtra and Goa. The brand continued its upward trajectory by fostering trust and credibility among consumers, achieved through enhanced distribution and market penetration strategies.

The brand was brought to consumers' attention through various campaigns such as Heineken 150 years, UEFA Champions League 'Cheers to all fans', Quality credentials, and the responsible consumption campaign 'When you drive, never drink'. Strategic partnerships with top influencers in sports and lifestyle spheres were instrumental in further boosting Heineken's brand affinity. Heineken gave an unforgettable experience to its Indian consumers and customers at the UEFA Champions League Final in Istanbul and the Formula 1 Grand Prix in Singapore, unique and exciting consumer experiences were curated, such as the Heineken? 150th anniversary celebration. This event saw consumers being treated to an unforgettable experience as the brand took over a prestigious 5-star property at The Westin Goa, a premier destination in India, with a 5-day non-stop exclusive party. Furthermore, Heineken's collaboration with Kygo's Palm Tree Music Festival, marking its debut in India, created an immersive celebration of music and enjoyment.

With Gen Z/Y leaning towards fresher and lighter beers, Heineken took pride in bringing Heineken Silver Draught Beer to India, setting a new standard in the world of premium beer, and continuing the legacy of Heineken's exceptional brewing heritage. Heineken Silver Draught is now available in premium pubs and bars in Mumbai, Thane, and Pune, with plans for further launches in other markets in the coming months. Heineken Silver Draught Beer promises the freshest and smoothest taste for a enhanced drinking experience. Heineken's Global Draught Master showcased the art of the perfect pour and spearheaded an intensive Star Quality training program for over 400 bartenders in Mumbai and Pune. The program will continue with a comprehensive training sequence, introducing a unique pouring technique of 5 simple steps to ensure the highest quality Heineken draught drinking experience for consumers in India. An innovative practice of skimming the beer adds a distinctive feature to Heineken Silver Draught, marking noteworthy 'innovation' in draught beer pouring within the Indian market.

Supply Chain

Manufacturing expenses for FY24 amounted to H46,612 million, representing 57.44% of net sales. The year volume was planned more ambitiously vis-a-vis 2023. Your Company was, however, confronted with numerous external factors disturbing production and dispatches in the first half of the year. In the second half, much of the losses were recovered to finally arrive at a production volume that matched the previous year.

During the year various opportunities for raw and packaging material cost savings were developed and implemented. Barley malt was in adequate supply locally reflecting in lower price which filtered through to the bottom line in the second- half of the year. The bottle supply market remained tight which necessitated the import of new bottles. The recycled bottle supply chain was very much disturbed by high cullet demand, as reflected in a reduced return rate. The combined effect led to materially higher costs of bottles. Inflationary pressure on the packaging commodities of energy, soda ash, paper, steel, and aluminum eased during the year under review. The cost of bottles and higher Can salience has resulted in an increase of overall cost of packaging materials.

To support the growing demand for our premium products, the corresponding supply footprint was successfully extended with an emphasis on Ultra and Ultra Max production. It is now produced in more of our own breweries as well as in several of our contract breweries. In Chamundi Brewery, Karnataka, equipment has been put in place for Heineken and Heineken Silver production. Regulatory approval for commissioning is expected in the near future. In Uttar Pradesh, our contract partner expanded capacity resulting in record production and sales volumes.

Your Company has also set up a cross-functional process to ensure a continuous pipeline of product innovations that can be brought to the market and do so in compressed time frames.

During the year our focus on quality was strengthened under the motto "Our beer is our Pride". We extensively reviewed and upgraded our quality assurance and control process supported by ongoing investments and training. Total Productive Management (TPM) practices have been prioritized and unified across the breweries. Following this, the performance-driving system in the breweries is now well aligned with Company objectives and enabled by daily routines to manage focus performance metrics. In addition, our functional training efforts have been geared up focusing on the shop floor and first-line management.

HEINEKEN is determined to play its role in combatting climate change, intending towards reaching net zero across our value chain by 2040 and net zero in our operations (Scope 1 and 2) by 2030. With HEINEKEN aligning its sustainability ambition with the Science Based Targets Initiative (SBTi), we aim to contribute to these targets at the country level. Our sustainability strategy prioritises using clean energy, renewable energy investments, and

innovative solutions to turn goals into action and actively contribute to HEINEKEN's overarching sustainability objectives. 92.7% of your Company's thermal energy was produced from renewable sources, that is the agricultural by-product of biomasses. In addition, renewable electricity usage for own breweries was at 35.94% of total electricity usage. This was complemented by the purchase of iRECs (International Renewable Energy Certificates).

Recognizing the rising concerns about water availability in the country, your Company has initiated activities to further focus on water efficiency. To start with water source vulnerability assessments have been executed for most of our breweries. In the year to come studies for the remaining water efficiency breweries will be completed. Your Company's ongoing program has now been supplemented by an extensive set of Heineken global best practice-inspired initiatives that are now being rolled out across the brewery network. The overall aim is to achieve substantially reduced consumption rates to reach world-class efficiency levels that reflect the level of your company's environmental responsibility.

Research and Development

Your Company's Research and Development function continues to support its growth strategy with a focus on new capabilities, development of new products, enhancement of existing products, productivity improvement, and cost reduction.

Digital & Technology

Having laid strong foundations for Digital & Technology last year, your company focussed on driving four key priorities - Digitizing Route to Consumer, Unlocking the value of Data, Simplification & Automation of Core Business Processes and Creating a digitally enabled organization.

We approached Digital Route to Consumer with a Product mindset and focussed on interventions to drive up user adoption. We launched 'Data Brew' - Business Intelligence platform to drive data driven decisions and performance culture across the company. The analytics products built on this foundation added clear & tangible value. We focussed on simplification & automation across the value chain to unlock productivity. The initiatives here were able to unlock about 6500+ person hours in the company to invest behind growth.

We created a culture of experimentation and agility via a Cross Functional Digital Council Forum. User adoption & experience continue to be our core input metrics as we look to accelerate value across Growth, Productivity & Compliance.

Human Resources

UBL provides a congenial working environment which enables success through ownership, camaraderie, freedom of thought, and action.

Enabling a Diverse Workforce

At UBL we continue to work towards our commitment to fostering an inclusive and supportive work environment for all employees. As an organization, we recognize the unique challenges that employees from various groups (e.g., women, new parents, differently abled, etc.) may face in the workplace and therefore we have taken specific initiatives and have policies in place for actively shaping the workplace where these diverse groups of employees are supported so that they can thrive, contribute their best, and achieve their professional goals.

Our Inclusion & Diversity Council supports the delivery of UBL's Diversity & Inclusion strategy and roadmap in line with the Diversity, Equity, and Inclusion framework. The council actively participates in identifying opportunities to build awareness, enabling an inclusive work environment through policies and inclusive engagements, embedding equal opportunities in the ways of working, and measuring the Company's progress on key metrics.

At UBL, we have been actively working on changing mindsets and creating an environment that fosters inclusion. Leadership has an important role to play in embracing this change and driving it as a priority as it filters down to the rest of the organization, and eventually becomes part of the culture. This year, 100% of our people managers were trained on the modules covering Inclusive Leadership and Unconscious Bias.

We continue to focus on having a gender-balanced workforce across levels and functions including senior management. This year women's participation in the UBL executive workforce increased from 5.8% in Dec 2021 to 19% in March 2024. Of the employees hired under the executive cadre in FY24, 36% were women. We also have development programs like HIMAC, WIN, Upsurge, and Brewing Great Managers in place to enable and support women leaders to propel themselves into the C-Suite.

Unlocking the Potential of Our People

At UBL, we are committed to providing our employees with the tools and resources needed to succeed in their roles and develop their skills for long-term career growth. The learning programs are tailored to the individual needs of employees so that they can focus on the specific skills and knowledge relevant to their role and progress at their own pace.

To create a strong foundation for Talent Management practices, we inducted Talent Champions and oriented them on our Talent Beliefs, Potential Models, and other talent ideologies. The People Review is a critical talent process that was conducted last year as well, covering important elements of potential assessment, development planning, and succession planning. To improve performance enablement, communications were reinforced, and training and awareness sessions were held on the performance cycle, objective setting, mid-year review, end-year review, career planning, and coaching.

To deepen awareness and understanding of the organization's culture, Purpose, Values, and Behaviors workshops were launched through face-to-face 'Ankuran' workshops. Through 40 interactive and engaging workshops, 83% of our colleagues were introduced to the organization's Purpose, Values, and Behaviors framework and guidelines.

We believe that everyone has talent, and differentiate based on both performance and potential

To make learning accessible and relevant for everyone, new learning platforms were launched, promoted, and used for digital learning in FY24. New processes were created and implemented to manage learning data and administration online. Learning communications were also improved, and different channels were used to promote learning. To promote a learning culture, awards and recognition based on learning were introduced.

Our online learning platform UBrew-Brew a Better You provides employees with all the resources they need to brew a better version of themselves. This platform includes functional learning resources, LinkedIn Learning content, mandatory training, replays of past training sessions, and access to learning resources across HEINEKEN. Employees are provided with the flexibility to access resources anytime and anywhere and embark on a continuous learning journey.

UBL believes that passionate, talented, remarkable people on our teams can and will continue to elevate our organization. We nurture young talent and groom them as future leaders by developing and engaging them. We approach the best minds on college campuses and provide them with a learning opportunity through a comprehensive development program for Trainees in various functions, called Brewing Young Minds. This multi-month learning journey aims to provide the perfect blend of theoretical knowledge and

practical experience on the shop floor and in the markets to develop young leaders. The program ensures an overall understanding of each of the respective functions and continues to be impactful from 2022 into 2024 and beyond.

People Managers play a pivotal role in how our organization hires, develops, supports, and grows our people. To equip all managers with the capabilities needed to essay these responsibilities well, we have co-created a dedicated development program for managers, Brewing Great Managers. The program enables each people manager to align the efforts of their teams, develop and encourage them to give their personal best, getting them to work cohesively as a well-knit high-performing team. This program is a 5-month journey including a 1-day in-person workshop, followed by online learning and action planning, and pre-and post-program 270-degree feedback surveys. 136 managers were certified as Great Managers, and a second cohort of the program continues into the next year.

Brewing Great Managers

A culture of learning can foster a more innovative and adaptable workforce, leading to improved organizational performance. Our leaders, by investing in their own learning, set an example for the employees to engage in continuous learning and development. UBL provides opportunities for leaders to be part of the global programs at HEINEKEN such as HIMAC, and WIN, and regional and local programs such as MTFT and Upsurge. The learning journeys are built around acceleration projects and business cases designed to allow for deep reflection on leadership challenges. We facilitate their learning visits to other operating companies as part of these programs. These programs engage the leaders in a virtual discovery expedition to get a fresh, disruptive, outside-in perspective on different organizations and business models.

New learning programs were introduced in various functions, facilitated internally by functional subject matter experts. Masterclasses were conducted for all employees on topics of mass relevance. The mandatory learning program was enhanced, with greater coverage for colleagues in

our manufacturing units through face-to-face workshops. The onboarding program was also templatized and made more structured to improve the new joiner experience. Partnerships with ITIs were established in five of our breweries, with ongoing learning for Permanent Workmen in multi-month journeys. Through continuous learning and development with programs like these, we will continue unlocking the true potential of our people.

Leveraging Technology to Improve People Processes: Integration of MyHR into UBL Systems

With the rapidly evolving digital landscape, UBL ensures that our workforce is equipped with the necessary skills and resources. UBL has implemented MyHR as a global solution to connect all employees and permanent workmen covering the complete employee lifecycle on a single digital platform.

MyHR, with its intuitive self-service access, delivers a digital employee experience for our people and serves as a single source of truth for global people data for our business. The platform has also enabled a chatbot for employees and line managers to assist them with to-do items and actions. Using MyHR, users can manage their personal details, explore e-learning, manage their goals and performance, request time off, and apply for opportunities internally and in other operating companies. The line managers have comprehensive information on the employment information and the talent profile for their team Members enabling them to have a meaningful performance and developmental conversation.

Introducing AskHR and DocuHR platforms: These platforms have revolutionized the way employees access HR-related information and services. AskHR provides a comprehensive resource for policies, articles, and other important information. It also serves as a direct line of communication with our dedicated people team, allowing employees to seek guidance and advice whenever needed. DocuHR has enabled employees to access their personal e-files conveniently. Moreover, the people team can now generate personal letters directly from MyHR, ensuring accurate and efficient communication. Additionally, the integration of the DocuSign solution has streamlined the process of digitally signing employee documents thereby creating a Paperless HR Office.

MyTime: We have implemented MyTime, an Attendance Management System, to address inconsistencies in attendance management practices. This system automates the monitoring of work hours and overtime hours, ensuring accurate and reliable data. By eliminating manual processes, we have significantly reduced errors and improved efficiency. MyTime also provides a seamless validation process for vendor payments, resolving any issues related to contract

workers' management. This has also allowed us to centralize payroll processing for workmen bringing in efficiency and controls in the process.

Contract Labour Management System (CLMS): To further enhance our management of contract workers, we have introduced a dedicated Contract Labour Management System. This system offers a comprehensive solution for monitoring and managing contract workers, ensuring compliance and efficiency. It provides a centralized platform for tracking contracts, managing payments, and resolving any issues that may arise.

These initiatives have not only simplified HR processes but also improved employee experience and engagement. By leveraging technology and automation, we have created a more streamlined and efficient HR ecosystem, enabling our people team to focus on strategic initiatives and providing exceptional support to our employees.

Our focus for this year includes driving the adoption of key platforms such as MyTime, AskHR, DocuHR, MyLearning, and MyHR. We are also committed to building a paperless HR office and implementing a structured approach to statutory compliances, specifically obtaining licenses to operate at our breweries.

Speak-up: Grievances and Feedback Mechanism

UBL is committed to conducting business with integrity and fairness, respecting the law of the land, and upholding our values at the same time. We value the help of employees who identify and speak up about potential concerns that need to be addressed. The Speak Up policy helps raise concerns about suspected misconduct within the Company, which is any violation of our Code of Business Conduct or the policies under which UBL operates. The organization has appointed trusted representatives as points of contact to raise concerns about suspected misconduct and ensure that the confidentiality of conversations is maintained. We also capture employee feedback through various interventions including CEO Connect, Townhalls, and one-on-one employee connects.

Staying Connected with our employees

We champion a culture of belonging where all perspectives are heard, valued, and acted upon. The 2023 climate survey helped us capture valuable insight into the overall morale of the workforce and identify opportunities for enhancing productivity, motivation, and retention of the employees at UBL.

The survey results revealed that our employees feel strongly connected to one another, and they are confident in their ability to work together effectively. This is a testament to your Company's commitment to fostering a culture of collaboration, where everyone's input is valued, and diverse perspectives are welcomed.

Furthermore, the survey showed that our employees are highly conscious of safety risks and are dedicated to promoting a safe work environment. The results also indicated that our employees have a clear understanding of

our Company's objectives and are aligned with our purpose and values. This is a critical factor in our Company's success, as it ensures that everyone is working towards the same goals and is committed to achieving them.

Performance enablement, work-life balance, action planning, and increased and timely communication were key themes identified from the survey.

Performance enablement: The performance assessment process was streamlined through the MyHR platform. A secure and confidential environment was built for assessing performance. Sessions were conducted on potential and performance assessment and Evergreen performance cycle sessions to understand the WHATs and HOWs in performance, the need for continuous feedback, and ways to evaluate the ability to move to complex or larger roles. Personal plans with development actions based on any gaps employees and managers consider relevant were made mandatory as part of the performance review process.

Unlocking the Power of Winning Together: An annual meeting with the top talent and leaders at UBL was organized to emphasize the importance of collaboration. Ways to win

with Consumers and Shoppers, Customers, States, P&L with growth, breweries as our backbone, technology, external stakeholders, and most importantly with PEOPLE the right way were identified. Quarterly plans were charted to win in each state. Supply Chain and Commerce functions jointly owned the plans. Impediments were eliminated with accountability and transparency.

Building Future Fit Teams: Strengthening the organization structure in critical areas has been a priority at UBL. To aid this, hiring practices were strengthened with campus-to- career moves. ~24% of new joiners hired were from campuses. The onboarding experience was enhanced with shared ownership of the HR functional partners and central people team. A 1-day virtual induction program for all new joiners is planned every 2 months covering induction and presenters from all functions, brewery, and market visits. A pre-onboarding platform, Apical is launched in Quarter 4 to enhance the onboarding experience of new joiners.

MyRewards

Creating a habit of appreciation: A Recognition framework was introduced in June 2023 for all executives to embed the values and behaviors followed by the organization in the flow of work through a habit of appreciation. The framework helped to establish a consistent and fair approach to recognizing. Exceptional performance, exemplary display of behaviors and values, work anniversaries, and learning achievements are celebrated using the framework. The My Rewards platform was launched in 2024 with below reward categories:

^ Functional Excellence Awards: Award to recognize teams and individuals who exemplify UBL's core values

and go the extra mile to make a difference at the workplace and beyond. 111 colleagues were recognized through this award.

t Exemplary Performance Award: Award for managers to recognize and celebrate employees who have achieved exceptional results in their work or have consistently displayed exemplary behaviors. 326 colleagues were rewarded by the people managers through this award category.

Stronger Together Appreciation: A non-monetary appreciation category to celebrate and acknowledge our peers across functions who demonstrate exceptional values and behaviors. 875 colleagues were appreciated by other colleagues for their values/behaviors.

Milestone Award: Award to recognize and reward employees on their 2, 5, 10, 15-, 20-, 25-, and 30th work anniversary. 428 colleagues celebrated their work anniversaries this financial year.

Learning Luminaries: Award to celebrate the learning achievements of employees. 24 colleagues were rewarded for their learning achievements.

Streamlining People Policies: We strive towards simplification of policies to make them equitable, contemporary, and best in class. Policies on gratuity, leave, medical insurance with enhanced medical coverage, parental leave, internal job posting, employee travel, purchase of electronic devices, and internet usage were revamped.

Industrial Relations

The organization has successfully maintained harmonious and peaceful industrial relations across all locations. We have adopted a business imperatives-driven approach, focusing on upskilling, and engaging our workmen to foster a collaborative and motivated workforce. To enhance motivation and efficiency, we have implemented productivity-linked incentive schemes. We view our workmen as valued business partners, and therefore, we ensure timely communication on the Company's performance.

In addition, the below measures are taken to ensure harmonious industrial relations

• Brewery leadership teams are undergoing Industrial Relations training in all units.

• Long Term Settlements have been successfully concluded for five locations.

• A capability-building program is being conducted for Permanent Workmen in collaboration with ITI colleges.

• APRAJITHA has been appointed as an independent third-party compliance partner to ensure labor law compliance across our breweries.

Employee Health and Safety

Employees and workers are the backbone of our organization, and their health, happiness, and safety at work are our utmost priorities.

The manager-led work-from-home option allows employees to work remotely under the guidance of their managers. Additionally, flexible work hours enable employees to log in two hours early and log off two hours before their designated working hours. To enhance the medical benefits for our employees, we have improved our Medical Insurance coverage, increasing the sum insured for the base category to INR. 3 lakhs. Furthermore, we have provided all employees with the opportunity to undergo a free annual health checkup. At our brewery locations, we offer free breakfast to ensure employees start their day on a healthy note. To promote comfort and productivity, ergonomic workstations have been provided at the offices. Wellness programs that focus on both physical and mental health, emphasizing the importance of overall well-being were conducted. These measures reflect our commitment in creating a safe and supportive work environment for our employees.

We stand by our motto of, "Safety first, Safety always". Our primary aim is to enhance safety measures by concentrating on the aspects that we consider pose a high risk to safety because of the nature of the processes. These aspects include occupational safety, process safety, and in-plant traffic safety. We are committed to reducing and controlling risks through regular risk assessments. We have a robust system of controls in place for high-risk activities and have observed their effectiveness. Furthermore, we have implemented an operational risk reduction program to ensure the longevity of these controls.

We are persistent in performing a Process Hazard Analysis (PHA) as part of process risk reduction for new or expanded projects exclusively in the brew houses, package halls, and utility systems. The corporate safety team ensures conducting a prestart safety review (PSSR) before commissioning and handing over the system to the operation team in the breweries.

We made a significant improvement in managing the traffic system within the facilities. We performed a hazard identification (HAZID) analysis on the traffic flow and emergency evacuation procedures to facilitate the movement of the emergency response team in the event of an emergency at the breweries. Using the insights gained from the study, we have begun implementing measures such as separating pedestrians, implementing dock-level parking, and reducing risks associated with the operation of powered truck trolleys (forklifts). These measures have reduced high-risk situations by 50%. Moving forward, we will continue to collaborate with our technological partner to develop advanced and reliable systems to further reduce risks.

In 2023, we introduced a new measure to report on our safety performance for reporting incidents across the sales and marketing functions. To benchmark our safety performance, we have modified our two KPIs (accident frequency rate and accident severity rate) in line with OSHA's (Occupational Safety and Health Administration) performance. A new term, "Hi-potential Near-miss," was recently introduced to draw attention to potentially life-altering injuries and to guide leaders on proper response protocols. This updated safety approach is built upon a consistent emphasis on human performance, which refers to the interaction between people, culture, equipment, work systems, and processes.

UBL aims to prevent incidents by maintaining safety barriers and providing training, including the introduction of the

Life Saving Commitment (LSC). The LSC sets safety rules, acknowledging that mistakes happen, but we work on controls to fail safely and enhance safeguards, reducing the chance of serious injuries.

The organization values people as key to solving problems. We use an open platform called Safety Committee to share lessons and enhance capabilities. Our 5Rs (Regularly, Recognize, Reward, Rarely, and Reprimand) of safety behavior encourage open communication.

We work with a large portfolio of contractors and suppliers and help them understand our safety requirements. Together, we seek to improve safety performance by building skills and expertise and creating an inclusive and safe work environment. We continue to strengthen the safety culture and leadership among our employees at all levels, including the contractor team. Multiple initiatives are taken across units to keep our employees and workers safe, happy, and healthy. These practices also cover the families of our workforce to ensure sustenance beyond the workplace.

UBL has 1364 employees on its rolls across all locations as of March 31, 2024.

Total employee benefit expenses for the year stood at H6,428 million, as compared to H5,914 million in the previous year. This constituted 3.48% of gross revenue from operations. Your Directors place on record their sincere appreciation to all employees for their contribution towards the continued success of the organization.

CORPORATE SOCIAL RESPONSIBILITY AND BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

At UBL, we are committed to 'BaBI' and we firmly believe in conducting our business sustainably and responsibly, benefiting both people and planet. We aim to meet the interests of all our stakeholders, with a particular focus on improving the lives of the community and reducing the impact of our operations on the environment from which we draw our resources.

Over the last year, we pivoted our Corporate Social Responsibility (CSR) focus areas and projects to ensure that our initiatives are aligned to the evolving needs of the community and our planet. To better address the overall concerns on the environment, we expanded our scope of work on the focus area 'water' to 'environment' which will now look at more holistic development of the ecosystem. We also increased our efforts in other focus areas such as 'community development', 'women empowerment', and 'address harmful use' to have a more strategic and impactful approach across various projects. Through partnerships with credible implementation partners, we will continue to implement projects that are meaningful and sustainable.

In FY24, we spent more than 75% of our CSR funds on the focus area of environment. We implemented eight projects promoting water conservation, climate-resilient agriculture, and afforestation in Telangana, Karnataka, Haryana, Rajasthan, Maharashtra, Punjab, and Kerala. These initiatives have positively impacted more than 39,000 lives in the year.

In the year, our projects' potential annual volumetric water benefit amounts to 1,89,435 KL/year1, as per volumetric water benefit accounting method as developed by World Resources Institute (WRI).

We also concluded phase 1 of project Kartavya, an initiative aimed at addressing the harmful use of alcohol in Punjab. Under the project, more than 200 individuals were educated through 11 training sessions focused on the importance of adopting moderation, knowing your drink, always providing the option of non-alcoholic beverage(s), consuming water, and food alongside alcoholic beverages, and not drinking and driving.

We aim to create a more equitable world by providing equal opportunities for women. During the year, we initiated project SAKhEE (Strengthening and Advancement of Women in Khurda by Entitlement & Enterprise) in Odisha through which we trained and upskilled 236 women to manage enterprises successfully while educating them about livelihood opportunities and social security entitlements. Additionally, this project seeks to leverage the potential of convergence and has established an alliance with the state government in Odisha via a partnership with the Khurda and Jatni municipalities, and the Housing and Urban Development department. We aim to reach and support 500 women during the course of this project.

The Business Responsibility and Sustainability Report on the framework of the National Guidelines on Responsible Business Conduct (NGRBC) which are based on ESG parameters, enabling organisations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting in format prescribed under the Securities and Exchange Board of India ("SEBI") (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations") is annexed as Annexure - A to this Board's report. Annual Report on CSR activities in terms of the Companies Act, 2013 ("the Act") and the Companies (Corporate Social Responsibility) Rules, 2014, is annexed as Annexure - B to this Board's report.

Environment and Sustainability

Weaving sustainability and responsibility into the fabric of our balanced growth strategy, we have aligned our Sustainability roadmap to HEINEKEN's sustainability strategy Brew a Better World (BaBW), through which we have raised the bar across three pillars (Environmental, Social, and Responsible),

and nine ambition areas. We are building execution and operational momentum through various initiatives to bring our ambitions to life and BaBI.

The BaBI strategy has had a profound impact on our business and the foundation on which we deliver the Sustainable Development Goals (SDGs). We continue to steer our focus on reducing carbon emissions, leading water stewardship initiatives, building circularity, and enhancing our transparent reporting. From addressing climate change to water scarcity and creating a more equal and fair society, we are determined to play a part in addressing these challenges.

As part of the BaBI strategy, one of our most important ambitions is to reach Net Zero for all our production sites by 2030 and in our entire value chain by 2040. UBL has been consistently marching ahead in its journey of maximizing the usage of renewable energy. This journey demonstrates the organizational vision to lead the initiative by being proactive and contributing to environmental protection.

For FY24, the Company sourced 78.8% of its total energy from renewable sources. We have been able to successfully reduce carbon emissions (scope 1 and scope 2) by 31.32% over the previous FY

We strive to reduce freshwater consumption by consistently working on water efficiency projects and maximising reuse and recycling. Our glide path on reduction of freshwater use started in the year 2006 with 7.42 hl/hl while in FY24 we are already at 2.93 hl/hl. Overall, we have set our ambition to reduce our freshwater intake to 2.6 hl/hl in breweries in water-stressed areas and 2.9 hl/hl in the remaining breweries by 2030. We will combine our drive for water efficiency with water balancing projects in water-stressed areas.

On circularity, our sustainable waste management program aims to reuse and recycle to the maximum possible extent and balance solid waste disposed of in landfills or through incineration. For the financial year, we have achieved 90.64% landfill-free, and we aim to be 100% landfill-free by 2025. We are persistent in recovering the used bottles from the market and keep the upusage of recycled bottles which is currently at ~60%. We continue to send all our by-products-spent grain and surplus drier yeast, for animal feed & poultry stock. Our packaging team is working tirelessly for sustainable packaging like carton boxes made from kraft paper, 80% recycled paper, improved glass bottles to withstand harsh environments, and fully recyclable aluminum cans. As a socially responsible organisation, we collectively ensure equivalent quantity of plastic used as part of our packaging materials are recycled through EPR (Extended Producer Responsibilities) and whatever plastics enter into our premises along with the raw materials are collected in-house and sent to authorised recyclers.

While our ambitions inspire us, our actions define us. Raising the bar here too, we continuously evaluate and improve our ways of working, governance, and transparent reporting. We have refreshed our areas of focus for creating value - we call it our 'Green Diamond' - which now reflects

sustainability and responsibility next to organic growth, profit, and capital efficiency.

Excellence Awards:

• Our brewery at Aravalli, received the Gold Status award in the 48th CII Kaizen competition in FY24 for reducing the landfill of boiler ash.

2) Corporate Social Responsibility:

• UBL was awarded the 'Company with the best CSR Impact' at the 9th Dalmia Bharat CSRBOX CSR Impact Awards 2023. This is in recognition of the impact that was created within all our cocommunities through the effective implementation of impactful CSR initiatives on the ground.

• UBL was awarded the 'Sustainability Impact Award 2023' at the 2nd Edition Sustainability Summit & Awards 2023 by UBS Forums. This is in recognition of the sustainability strategy - BaBI and the progress against the ambitions of FY23.

• UBL was the first runner-up in the 'Agriculture & Rural Development' category at the 6th edition of CSR Journal Excellence Awards 2023. This is in recognition of the water conservation project in Sangareddy, Telangana, and Nelamangala, Karnataka.

OPPORTUNITIES, THREATS, RISKS & CONCERNS

The Indian beer industry is poised for growth in FY24 and beyond, driven by a combination of demographic shifts, urbanization trends, and rising income levels. This growth is fueled by the increasing preference for alcoholic beverages among the younger population, particularly millennials, who are drawn to beer for social gatherings and celebrations.

Demographically, India is experiencing a youth bulge, with a median population age of 28, indicating a large market of legal drinking-age individuals who are likely to drive beer consumption. The beer market is also seeing a shift towards more diverse product offerings, including flavored and non-alcoholic beers, catering to a broader range of consumer preferences.

Premiumization is a strategic priority within the beer industry, with consumers showing increasing brand consciousness and a willingness to pay a premium for brands and quality. The trend towards premium and craft beers is indicative of a maturing market where consumers seek unique and diverse flavors. This shift is further supported by the rise of e-commerce, which provides easy access to a wide variety of beer options, and social media, which influences consumer preferences and brand awareness.

The industry also faces challenges such as regulatory hurdles, high taxation, and restrictions on advertising alcoholic beverages. Strategic marketing and competitive pricing will

be key to capturing market share in this evolving landscape and with a focus on understanding consumer preferences, innovating product lines, and expanding distribution networks your Company will tap into the urban and youthful consumer base.

In terms of per capita beer consumption, India has traditionally lagged behind many other countries. In FY24, the average beer volume per person in the Indian beer market is estimated to amount to 2 liters. This is significantly lower when compared to most other countries. This disparity highlights the potential for growth in the Indian beer market. With a large population base, even a small increase in per capita consumption can translate into significant absolute volume growth for the industry. As the Indian market embraces premiumization and as consumer preferences evolve, there is an opportunity for the industry to increase per capita consumption by introducing a wider variety of beer products and engaging in targeted marketing strategies to shift cultural perceptions and drinking habits.

Competition is getting stronger through the introduction of new brands in various segments like craft and premium beer, and whilst this is good for the beer category, your Company is well poised to compete with its innovative brand offerings, product quality, distribution network, and brand value. Together with HEINEKEN and its international brand portfolio, your Company is well-positioned to compete and win with strong brand equity. New products like Heineken Silver, London Pilsner, and Bullet have been launched in key markets like Karnataka, Maharashtra & Goa and have been very well accepted by discerning customers.

A variety of taxes and levies are imposed on beer during and after production, transport, and sale by each state. Pricing regulations, inadequate market infrastructure and restrictions as well as additional taxes on inter-state movement of beer continue to pose a challenge to the industry. The regulatory pressure and constant changes in the political climate in the country are also present. The industry also at times is faced with challenges in liquidity and working capital management. These primarily arise on account of timing differences in collection of sales. During the year, your Company also faced challenges in liquidity and working capital management, primarily due to prolonged collection period of our receivables from one State Beverages Corporation Limited. Your Company is proactively engaged with various state bodies in order to work together to ensure an optimal business climate.

Despite some inflationary softening during the year, the impact on the cost base is expected to continue in the near term and the ability to increase prices to compensate for inflation is challenging in the regulated environment. Your Company is seeking appropriate action to further mitigate the impact, evident from the strategic price revisions received in key States through active engagement with the Government along with strategic saving initiatives.

Changes in the availability, quality, or price of raw and packaging materials, commodities, transportation, or monopolistic supply situations could result in a shortage of sources and/or increased costs. Barley being a key ingredient is subject to market forces volatility. Your Company is exploring the option of collaborating on farming. New Glass availability is constrained in India. Your Company is developing a strategic action plan to address the long-term supply risk of bottles. Discussion with incumbent & alternate suppliers is being pursued.

The effects of social and economic catastrophes in the market often make it difficult to predict demand cycles. To overcome these challenges, your Company continues to remain cost-conscious at all levels of operations and work with a high level of agility and efficiency. Your Company continues to invest in and expand the brand portfolio while continuing to be cost-efficient and quality-focused. Your Company continues to upgrade and adopt modern technologies and solutions to be able to respond with agility to current market demands, without losing focus on quality.

To cater to new consumers, capture market opportunities, compete with new launches by competitors, and in continuous endeavor to offer new product ranges and cater to new occasions. Your Company plans to launch this offering in other relevant markets in a phased manner.

The labor market in India is becoming more competitive. Your Company has taken various initiatives to be able to continue to attract the right talent, build a diverse and inclusive culture including the top management positions, and continue to create an engaging place to work.

Non-availability of water, rationing of its supply, and restrictions on withdrawal of groundwater also pose major threats. Your Company has built infrastructure that helps in the reduction of water consumption in breweries as a sustainability initiative. Your Company has proactively managed sustainability under the "3R" policy to reduce, recycle, and recharge as well as look at opportunities for water conservation through Rainwater Harvesting to achieve a positive or at least neutral water balance. Your Company's focus on sustainability is poised to increase many folds, which would help in addressing Environmental, Social, and responsible concerns. Adoption of HEINEKEN Evergreen's strategy would help meet short-term challenges and will ensure the long-term sustainability of our business to create lasting value for stakeholders.

Your Company also focuses on securing its IT operations and addresses the associated risks of cyber security. This includes risks from IT security lapses, malware and ransomware attacks, disruptions in key Enterprise Processes, and hacking, which could lead to disruptions in business operations and loss and/or leakage of confidential data. Your Company now has a focused approach towards IT (Data & Technology) and has adopted Best-In-Class technology solutions to become the best-connected Brewer.

Prospects

In recent years, India's beer market has witnessed an unwavering ascent, steadfastly defying economic turbulence and societal norms. The growth outlook for the Indian beer industry is optimistic and promising. The Indian Beer industry's growth rate in 2023 has been significantly high compared to the global beer industry average, growth rate, which can be attributed to a confluence of factors, from shifting demographics to economic resurgence, has ignited intense growth within this dynamic market. India's demographic landscape, characterized by a significant youth population, serves as a pivotal driver for the beer industry. The inclination towards low-alcohol content beverages among millennials, a notable rise in female drinkers, is propelling market expansion, with an escalating demand for diverse and premium-quality beers. As the nation's GDP continues its upward trajectory, so too does the average consumer's purchasing power, and shifts in consumer behavior, the Indian beer market is expected to continue expanding at a healthy pace. The instances of liberalization in retail and distribution further bolster the industry's growth prospects. Being a heavily underpenetrated market, the outlook for the Indian beer industry appears to be bright and full of potential.

Your Company's established brand equity provides a significant competitive advantage over other domestic and international brands. Your Company has built its position as the undisputed market leader in India with a strong network of breweries across the country and a fantastic portfolio with a presence in rural as well as urban markets led by its iconic Kingfisher brand family, complemented by a strong HEINEKEN international brand portfolio. With such a competitive advantage, the Company is poised for significant growth going forward.

The competitive landscape of the Indian beer market is undergoing significant evolution, characterized by the coexistence of both macro and micro-breweries, but your Company's brand-building initiatives, rooted in authenticity and innovation, are carving out niches in an increasingly crowded market. The challenging commodity inflation environment and continuing geopolitical tensions will continue to have an impact on costs, yet your Company shall continually strive for appropriate price increase approvals and achieve high operational efficiencies, and innovative long-term procurement strategies to offset the increase in costs. Augmenting capacities and strategic tie-ups in critical markets will continue to be a priority investment in the future too.

A legacy of efficient business management underscores a track record marked by sustainable growth and robust financial performance. Your Company seeks to drive beer category penetration, drive further premiumization, and reinforce the iconicity of Kingfisher while building the overall brand in addition to continued focus on efficiency & compliance, execution of the sustainability agenda, digitalization, and people development to build a highly motivated and skilled workforce.

Through these actions, we are confident that your Company will continue its leadership position, drive growth of the overall market, and expand profit margins in the years to come.

Growth in premium retail trade and on-premises outlets in metropolitan cities has increased the range of beers and improved the retail environment. Innovative introductions also help in penetrating untapped markets and consumer segments and your Company's new introductions have fared well.

Risk Management

Backed by strong internal control systems, the current Risk Management Framework consists of key elements laying down the roles and responsibilities in relation to risk management covering a range of responsibilities, from strategic to operational. These role definitions, inter alia, provide the foundation for appropriate risk management procedures, their effective implementation across your Company, and independent monitoring and reporting.

The Risk Management Committee, constituted by the Board, monitors, and reviews the strategic risk management plans of your Company as a whole and provides necessary directions on the same.

The Corporate Risk Team, through focused interactions with businesses, facilitates the identification and prioritization of strategic and operational risks, the development of appropriate mitigation strategies, and conducts periodic reviews of the progress on the management of identified risks.

The Company also focuses on IT Operational Resilience and management of cyber security risks in an increasingly connected world. The risks include external cyber-attacks, security lapses, and data privacy breaches which could lead to disruptions in business operations & loss of confidential data. We mitigate this through a 'Secure by culture' mindset replete with activations to drive user awareness, preventive controls, proactive threat monitoring, and periodic business continuity & disaster recovery drills. Complementing this is the Security Assurance discipline to drive up the scores against the action standards.

Your Company places high emphasis on regulatory compliance, especially in the frequently evolving regulatory set-up, and ensures that its operations are compliant in line with relevant and applicable laws. Your Company has raised the bar on its regulatory compliance and is committed to maintaining the highest standards of compliance by aligning the performance objectives with regulatory compliance requirements. The Company considers regulatory compliance crucial to build trust among its stakeholders, including investors, customers, employees, and the public at large. The Company has implemented effective controls, systems, policies, and procedures to ensure to identify, assess, and manage compliance risks on an ongoing basis. The Company also imparts regular training and guidance

on compliance matters to its employees to ensure that they understand their responsibilities and obligations.

Your Company undertakes a comprehensive review of its compliance obligations periodically and takes effective steps to ensure that it is fully compliant with all relevant laws and regulations. There are no risks, which in the opinion of the Board, threaten the existence of your Company.

Through these actions, your Directors are confident that your Company will sustain its leadership position, grow ahead of the market, and realize improved profitability in the years to come.

Internal Control System

Your Company has established a robust system of Internal Controls to ensure that assets are safeguarded, and transactions are appropriately authorized, recorded, and reported. With the introduction of Internal Controls over Financial Reporting (ICFR) in the Act, we have made an evaluation of the functioning and quality of internal controls and Corporate Governance Policy that guides the conduct of affairs of your Company and clearly delineates the roles, responsibilities, and authorities at each level of its governance structure and key functionaries involved in governance.

The Internal Financial Control framework of your Company is established in accordance with the COSO (Committee of Sponsoring Organizations) framework and is commensurate with the size and operations of your Company's business. In addition to statutory mandate, Internal Audit evaluates and provides assurance of advocacy and effectiveness through periodic reporting. Controls in place are routinely evaluated and audited by the Internal and Statutory Auditors and gaps are identified by the Auditors through a detailed testing exercise. The process of internal control ensures orderly and efficient conduct of business, safeguarding of assets, prevention, and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information. Financial Statements are prepared based on Significant Accounting Policies that are carefully selected by management. The Accounting Policies are reviewed and updated from time to time.

These, in turn, are supported by a set of Standard Operating Procedures (SOPs) that have been established for the business. Internal Control evaluates the adequacy of segregation of duties, transparency in the authorization of transactions, adequacy of records and documents, accountability & safeguarding of assets, and reliability of the management information system. The systems, SOPs, and controls are reviewed and audited by Internal Audit periodically for identification of control deficiencies and opportunities, whose findings and recommendations are reviewed by the Audit Committee and tracked through till implementation.

Your Company believes that the overall internal control system is dynamic and reflects the current requirements at all times, thereby ensuring that appropriate procedures and operating and monitoring practices are in place by regular

audit and review processes to ensure that such systems are reinforced on an ongoing basis.

Cash Flow Statement

A Cash Flow Statement for the year ended March 31, 2024, is appended.

Particulars of Loans, Guarantees or Investments

Loans, guarantees, and investments covered under Section 186 of the Act forms part of the Notes to the financial statements provided in this Annual Report. The Company has not advanced loans to Directors / to a Company in which the Director is interested to which provisions of Section 185 of the Act apply.

Depository System

The trading in the Equity Shares of the Company is under compulsory dematerialization mode. The Company has agreed with National Securities Depository Limited and Central Depository Services (India) Limited by the provisions of the Depositories Act, 1996, and as per the directions issued by the Securities and Exchange Board of India. As the depository system offers numerous advantages, Members are requested to take advantage of the same and avail the facility of dematerialization of the Company's Shares.

Fixed Deposits

The Company has not accepted any fixed deposit, including from the public, and, as such, no amount of principal or interest was outstanding as on the Balance Sheet date.

Material changes and commitments

There are no material changes and commitments that affect the financial position of the Company that has occurred between the end of the financial year to which the financial statements relate and the date of this report.

Subsidiary

During the year, the Board of Directors reviewed the affairs of the subsidiary. In accordance with Section 129(3) of the Act, we have prepared the consolidated financial statements of the Company, which forms part of this Annual Report. Further, a statement containing the salient features of the financial statements of our subsidiary in the prescribed format AOC-1 is annexed as Annexure - C to this Board's report. The statement also provides details of the performance and financial position of the subsidiary, along with the changes that occurred, during FY24.

In accordance with Section 136 of the Act, the audited financial statements, including the Consolidated financial statements and related information of the

Company and audited accounts of its subsidiary, are available on our website, at www.unitedbreweries.com

Related Party Transactions

Details of transactions with related parties as defined in the Act and the Rules framed thereunder, the Listing Regulations and Accounting Standard 18 of the Companies (Accounting Standards) Rules, 2006, have been reported in the Notes to financial statements.

The Company has formulated a policy on the materiality of Related Party Transactions and on dealing with Related Party Transactions (RPT) which is placed on the Company's website, at https://www. unitedbreweries. com /pdf/policvandcodes/Policv%20on%20Related%20 Partv%20Transactions.pdf

All transactions entered by the Company during FY24 with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company has not entered any transaction with related parties that could be considered material by the policy of the Company. Accordingly, the disclosure of RPTs as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable.

Cautionary Statement

Statements in this Report, particularly those which relate to 'Management Discussion and Analysis' and 'Opportunities, Threats, Risks, and Concerns,' describing the Company's objectives, projections, estimates, and expectations, may constitute 'forward-looking statements' within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied.

2. Human Resources Management Internal Complaints Committee

At UBL, we are committed to providing a safe and congenial environment to our employees. About the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013, the Company has an Internal Complaints Committee (ICC) constituted for its Corporate Offices, Brewery locations, and Sales offices for redressal of complaints under the Act.

The Internal Complaints Committee (ICC) consists of not less than 4 Members and has Senior-level women employees as Presiding officers, one external Member from NGOs or associations committed to the cause of women, and employees committed to the cause and prevention of issues relating to sexual harassment. I

I n September 2023, the policy was amended, and an Internal Appellate Committee was also constituted in case the complainant and respondent are aggrieved by the recommendations and findings of the Internal Complaints Committee or by the order of the management. The role of the Appellate Committee is to review the appeal and report of the Internal

Complaints Committee and dispose of the appeal within 60 days of receipt of the appeal based on the record of the proceedings.

The role of the ICC is not restricted to mere redressal of complaints but also encompasses the prevention and prohibition of sexual harassment. The details of sexual harassment complaints that were filed, disposed of, and pending during the financial year are provided in the Corporate Governance and Business Responsibility & Sustainability sections of this Annual Report.

Whistle Blower Policy

The Company has adopted a vigil (Speak Up) mechanism which is a channel for receiving and redressing complaints about any misconduct, actual or suspected fraud, actual or potential violations of the Company's code of conduct, and any other unethical, unlawful, or improper practices, acts, or activities within the Company. The Company has implemented multiple channels for Employees, Directors, and any third parties to Speak Up and has ensured adequate safeguards against victimization of whistle-blowers. The details of the establishment of the vigil mechanism are disclosed in the Company's Code of Business Conduct which is available on the Company's website.

None of the Employees and Directors have been denied access to the Chairman of the Audit Committee. No whistle-blowing complaints are leading to material fraud or that have an impact on the financials of the Company.

Particulars of Employees

The Company has 1,364 employees as of March 31, 2024.

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 (hereinafter referred to as the "Rule") forms part and is annexed as Annexure - D to this Board's report.

In terms of the provisions of Section 197(12) of the Act read with rules 5(2) and 5(3) of the said Rules, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said Rule forms part of this Board's report. However, in terms of first provision of Section 136(1) of the Act, the Annual Report and Accounts are being sent to the Members and others entitled thereto, excluding the aforesaid information. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary & Compliance Officer, stating their Folio No./ DP ID and Client ID, whereupon a copy would be sent.

Employees Stock Option Scheme

The Company has offered Shares to its eligible employees under the HEINEKEN Senior Management Reward Programme.

Our corporate governance philosophy

Our corporate governance practices reflect our value system encompassing our culture, policies, and relationships with our stakeholders. Integrity and transparency are key to our corporate governance practices to ensure that we always gain and retain the trust of our stakeholders. Corporate governance is about maximizing Shareholders' value legally, ethically, and sustainably. We also endeavor to enhance longterm Shareholder value and respect minority rights in all our business decisions. Our Corporate Governance section for FY24 forms part of this Annual Report.

Board Diversity

The Company recognizes and embraces the importance of a diverse Board in its success. We believe that a truly divided Board will leverage differences in ideas, perspective, regional and industry experience, cultural and geographical background, age, ethnicity, race, gender, knowledge, and skills including expertise in financial, diversity, global business, leadership, information technology, Board service and governance, sales and marketing, Environmental, Social and Governance (ESG), risk management and cybersecurity and other domains, which will ensure that the Company retains its competitive advantage. Additional details on Board diversity are available in the Corporate Governance section that forms part of this Annual Report.

Code of Business Conduct and Ethics

The Board of Directors of UBL has adopted a Code of Business Conduct in terms of the Listing Regulations which has been posted on the Company's website, at https://www.unitedbreweries.com/pdf/policvandcodes/ Code%20of%20Business%20Conduct%20And%20 Ethics.pdf

Code for Prevention of Insider Trading

Your Company has adopted a comprehensive 'Code of Conduct to Regulate, Monitor and Report of Trading by Insiders' and a 'Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information' relating to the Company, under the provisions of the Securities Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.

The Board of Directors has approved and adopted the 'Code of Conduct to Regulate, Monitor and Report of Trading by Insiders' and a 'Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information.'

Policy on Director's appointment and remuneration

The current policy is to have an appropriate mix of executive, non-executive, and independent Directors to maintain the independence of the Board and separate its functions of governance and management.

As of March 31, 2024, the Board had 9 (nine) Members, consisting of two executive Directors, two non-executive Non-Independent Directors, and five independent Directors. Two of the independent Directors of the Board are women. The details of Board and Committee composition, tenure of Directors, areas of expertise, and other details are available in the Corporate Governance section that forms part of this Annual Report.

The policy of the Company on Director's appointment, KMP & Senior Management, and remuneration, including the criteria for determining qualifications, positive attributes, independence of a Director, and other matters, as required under sub-section (3) of Section 178 of the Act, is available on the Company's website at https://www.unitedbreweries.com/pdf/ policvandcodeslRemuneration-Policv.pdf

We affirm that the remuneration paid to the Directors is as per the terms laid out in the Remuneration Policy and criteria for making payments to non-executive Directors of the Company.

Dividend Distribution Policy

As required under Regulation 43A of the Listing Regulations, the Company has formulated a Dividend Distribution Policy. This policy can be viewed on the Company's website and is available through the webpage https://www.unitedbreweries.com/pdf/policvandcodes/ Dividend%20Distribution%20Policv%202016.pdf

Corporate Governance Report

Report on Corporate Governance forms a part of this Annual Report along with Certificate from Company Secretary in Practice.

Annual Return

Pursuant to the provisions of Sections 92(3) and 134(3) (a) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the draft Annual Return of the Company for the financial year ended March 31,2024 is available on the website at https://www.unitedbreweries.com/pdf/AGM/Annual- Return-MGT-7%E2%80%932023-2024.pdf

Secretarial Standards

The Company complies with all applicable secretarial standards issued by the Institute of Company Secretaries of India.

Internal Financial Control and its adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, safeguarding of its assets, prevention, and detection of fraud, error-reporting mechanisms, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures. For more details, refer to the 'Internal control system' section in the Opportunities, Threats, Risks & Concerns, which forms part of this Board's report.

Cybersecurity

At UBL, we continued to remain vigilant on the evolving cybersecurity threat landscape. Your Company focuses on securing its Technology & Data operations and addresses associated risks of cyber security. During the year, we fostered a 'Secure by Culture' mindset through a series of Trainings, focus group engagements & simulations. We continue to deploy best in class solutions to monitor, track & improve our cybersecurity assurance.

Directors and Key Managerial Personnel (KMP)

The Board of the Company currently comprises of 9 (nine) Directors with a balanced combination of Executive, Non-Executive, and Independent Directors.

(I A) Appointment of Directors

During the financial year, the Board, based on the recommendation of the Nomination and Remuneration Committee appointed:

1. Mr. Subramaniam Somasundaram (DIN 01494407) as an Additional Director (in the capacity of Independent Director) of the Company with effect from June 04, 2023, for a term of five (5) years till June 03, 2028, and his appointment was regularized and approved by the Members of the Company at the AGM held on August 10, 2023.

In the opinion of the Board, Mr. Subramaniam Somasundaram, Independent Director, appointed during the year possesses requisite integrity, expertise, experience, and proficiency.

2. Mr. Vivek Gupta (DIN 10311 134) as an Additional Director (in the capacity of Managing Director, Chief Executive Officer and Key Managerial Personnel) of the Company with effect from September 25, 2023, for a term of five (5) years till September 24, 2028, and the Resolution for regularization of his appointment has been approved by the Members of the Company through Postal Ballot process on December 15, 2023.

(I B) Appointment of Company Secretary & Compliance Officer

Mr. Nikhil Malpani (ICSI Membership Number-A20869) as Company Secretary & Compliance Officer and Key Managerial Personnel of the Company with effect from May 07, 2024.

(II) Re-appointment of Director retiring by rotation

Mr. Jan Cornelis van der Linden (DIN 08743047) a Non-executive Non-Independent Director retires by rotation at this Annual General Meeting

(AGM), and being eligible, has offered himself for re-appointment. A resolution for the

re-appointment of Mr. Jan Cornelis van der Linden is proposed at this AGM.

(III) Resignation of Company Secretary & Compliance Officer

During the financial year, Mr. Amit Khera, ex-Company Secretary & Compliance Officer and Key Managerial Personnel, had resigned from the said position with effect from February 14, 2024. The Board of Directors placed on record, its appreciation for Mr. Khera's invaluable contribution, guidance, and support provided by him during his tenure.

Meetings of the Board and Committees, Board Evaluation and Familiarisation Programme

The meetings of the Board and Committees are prescheduled, and a tentative calendar of the meetings finalized in consultation with the Directors is circulated to them in advance to facilitate them to plan their schedule. In case of special and urgent business needs, approval is taken by passing resolutions through circulation. The Board met 7 (seven) times during the financial year. Other details including the composition of the Board and various Committees and meetings thereof held in FY24 are given in the Corporate Governance section forming part of this Annual Report. The maximum interval between any two Board and Audit Committee meetings did not exceed 120 days, as prescribed under the Act.

The details of the familiarization programme, Annual Board Evaluation for Directors, policy on Directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and remuneration for Directors forms a part of the Corporate Governance section of this Annual Report.

Declaration by Independent Directors

During the year, one (1) meeting of Independent Directors was held on October 18, 2023. The Company has received the necessary declaration from each independent Director under Section 149(7) of the Act, that he/she meets the criteria of independent laid down in Section 149(6) of the Act, Code for independent Directors of the Act and of the Listing Regulations.

(I) Audit Committee

The Audit Committee of the Board of Directors is constituted to act by the terms of reference and perform roles, as prescribed under the Act and Listing Regulations. The composition of the Audit Committee, its terms of reference, roles, and details of meetings convened and held during

the year under review are given in the Corporate Governance section that forms part of this Annual Report.

During the year under review, all the recommendations of the Audit Committee were accepted and approved by the Board.

(II) Nomination and Remuneration Committee (NRC)

The NRC is constituted to act by the terms of reference and perform roles, remuneration policy as prescribed under the Act and Listing Regulations. The composition of the NRC, its terms of reference, roles, and details of meetings convened and held during the year under review forms part of Corporate Governance section of this Annual Report.

The salient features of the remuneration policy is also provided in the Corporate Governance section forming part of this Annual Report.

During the year under review, all the recommendations of the Nomination and Remuneration Committee were accepted and approved by the Board.

Statutory Auditors and Audit Fees

Deloitte Haskins & Sells, Chartered Accountant (Firm Registration Number 008072S) ("DHS") was appointed as the Statutory Auditors of the Company, to hold office for the first term of five consecutive years from the conclusion of the 23rd AGM of the Company held on August 10, 2022, till conclusion of the 28th AGM to be held in 2027, as required under Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014. The Auditors have confirmed that they continue to fulfill the criteria for appointment as Statutory Auditors of the Company as prescribed under the Act and the Rules framed thereunder. The Statutory Auditors' Report for the financial year ended March 31, 2024 does not contain any qualification, reservation, or adverse remark. This Report is enclosed with the Financial Statements forming part of this Annual Report.

During the year, the total audit fees paid to the Statutory Auditors amounted to ' 33 Million (including fees for tax audit, quarterly limited reviews, certificates, and group reporting). The amount included an additional fees of ' 2.90 Million for the year ended March 31, 2023. The total audit fees excluded goods and services tax and other expenses.

Secretarial Auditor and Audit Report

The Company has undertaken Secretarial Audit for the FY24 which inter-alia, includes audit of compliance with the Act, and the Rules made thereunder, Listing

Regulations, applicable Regulations prescribed by SEBI, Foreign Exchange Management Act, 1999 and Secretarial Standards issued by the Institute of Company Secretaries of India.

The Company had appointed Mr. Sudhir Hulyalkar, Company Secretary in Practice, as Auditor for the audit of the practices and procedures followed by the Company as prescribed to undertake Secretarial Audit of the Company for the FY24. The Secretarial Audit Report forms part of this Board's Report and is annexed as Annexure- E. The Secretarial Auditors' Report for the FY24 contains an observation concerning non-response to the observation in their report for the financial year ended March 31,2023, which was inadvertently missed; shall ensure that such instances do not recur.

During the FY24, the Company appointed Messrs. BMP & Company, Company Secretaries, who replaces Mr. Sudhir Hulyalkar as Secretarial Auditor of the Company for a period of two years effective financial year 2024-2025.

Cost Records and Cost Audit

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Act are not applicable for the business activities carried out by the Company for the FY24.

Annual Secretarial Compliance Report

The Company has undertaken an examination of all applicable compliances as per Listing Regulations and Circulars/Guidelines issued thereunder, for the FY24. The Annual Secretarial Compliance Report as issued by Mr. Sudhir Vishnupant Hulyalkar, Practising Company Secretaries, shall be submitted to the Stock Exchanges, within 60 (sixty) days of the end of FY24.

This Report does not contain any qualification, reservation or adverse remarks for the FY24.

Reporting of frauds by auditors

During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the Audit Committee, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in this report.

foreign exchange and earnings and outgo Conservation of Energy

The Company is taking continuous steps to conserve energy. Its "Sustainability" initiatives are disclosed separately as part of this Report.

The particulars, as prescribed under sub-section (3)(m) of Section 134 of the Act, read with the Companies (Accounts) Rules, 2014, are annexed as Annexure - F

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Foreign Exchange Earnings and Outgo

During FY24 total foreign exchange earnings of the Company stood at H2,191 million (Previous Year: H1,723 million) and foreign exchange outgo stood at H3,633 million (Previous Year: H7,207 million)

Business Responsibility and Sustainability Report (BRSR)

The Ministry of Corporate Affairs (MCA) constituted a Committee on Business Responsibility Reporting ("the Committee") to finalize business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct (NGRBC). Through its report, the Committee recommended that Business Responsibility Report disclosures be based on ESG parameters, compelling organizations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting.

The BRSR disclosures form a part of this report. The non-financial sustainability disclosures (BRSR Core) have been independently assured by Deloitte Haskins & Sells LLP, Chartered Accountant.

Environmental, Social and Governance (ESG)

Our focus is steadfast on leveraging expertise to battle climate change, water management, and waste management. On the social front, our emphasis is on the development of people, especially in the areas of digital skilling, improving diversity and inclusion, and facilitating employee wellness and experience. We are also putting extra effort to serve the interests of all our stakeholders, by leading through our core values and setting benchmarks in corporate governance.

The existing CSR and ESG Committee was constituted by the Board, to discharge its oversight responsibility on matters related to organization wide ESG initiatives, priorities, and leading ESG practices. The CSR & ESG Committee reports to the Board and meets regularly to review progress on the ESG ambitions articulated in our ESG vision.

Significant and material orders

No significant and material orders passed, or stringent actions taken by the regulators, courts, or tribunals impact the going concern status and the Company's operations in the future. However, we bring to your attention the following developments/orders for the sake of transparency. i)

i) Competition Commission of India (CCI): On September 24, 2021, the CCI passed an order under Section 27 of the Competition Act, 2002 ("Competition Act") in Suo Motu Case No. 06 of 2017 and imposed penalties on three beer companies, including the Company for alleged contravention of Section 3 of the Act ("CCI Order"). The penalty imposed on the Company is

H751.83 crores ("the Penalty"). The Company and other appellants filed appeals challenging the CCI Order before the National Company Law Appellate Tribunal ("NCLAT"). The NCLAT stayed the CCI Order including recovery of the penalty amount imposed by the CCI, subject to a deposit of 10% of the penalty, by the Company. The NCLAT dismissed the appeals vide order dated December 23, 2022 ("NCLAT Order"). The Company and other appellants have filed appeals against the NCLAT Order in the Supreme Court of India ("Supreme Court"). The Supreme Court admitted the appeals vide order dated February 17, 2023 ("SC Order"), stayed the NCLAT Order and consequently, the CCI Order, subject to a deposit of an additional 10% of the penalty, over and above the amount already deposited with NCLAT. The Company has already deposited 20% of the penalty by way of fixed deposits in favor of the Registrar, NCLAT in pursuance of NCLAT Order and SC Order.

ii) Bihar Industrial Area Development Authority (BIADA): BIADA had allotted 42 Acres of land ("the Land") to the Company on June 3, 2011, in Kopakalan Industrial Area, Naubatpur, District Patna on a lease basis for establishing a brewery. The Company had established a brewery over the Land, which was closed on April 1, 2017, upon imposition of prohibition by the Bihar State Government. The Company restarted the unit over the Land and commenced production of non-alcoholic beverages in the unit in October 2018 after obtaining approvals from all statutory authorities. On June 25, 2022, BIADA issued a show cause notice for cancellation of allotment/ lease of the land due to non-operation of the unit. The Company replied that the production was temporarily stopped since it had sufficient stocks to meet the demand for its products and sought an extension to restart production. BIADA canceled the allotment of the land vide order dated December 16, 2022, against which the Company filed a writ before the High Court of Patna. The High Court vide order dated January 25, 2023, directed BIADA to maintain the status quo and directed the Company to file an undertaking that it will commence commercial production in the unit. The Company has filed an undertaking in the High Court that it will start commercial production in the unit with BIADA recalling the order of cancellation. Subsequently, on February 8, 2023, the High Court directed BIADA to take a policy decision to deal with the situation arising out of the action of BIADA in the present petition and identical matters. On August 10, 2023, BIADA notified two policies for availing options by the allottees to either (i) surrender the land; or (ii) sell/transfer the land; and on October 5, 2023,

BIADA notified another policy also to continue manufacturing activities over the allotted land.

On October 30, 2023, the Company filled an application to amend the writ to include additional matters related to setting aside the policy related to the continuance of the manufacturing activities over the allotted land which has stringent conditions or alternatively direct BIADA to extend the period to six months to avail the option to sell/ transfer the land. The matter is pending with the High Court.

The orders/proceedings mentioned above do not have any impact on the going concern status of the Company.

8. Other Disclosures

1. The Company has not issued any shares with differential voting rights/sweat equity shares

2. There was no revision in the Financial Statement

3. There has been no change in the nature of business of the Company as on the date of this Report

4. No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable

5. The requirement to disclose the 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, is not applicable; and

6. During the year, there was no change in the status of subsidiary, associate and joint venture companies as may be applicable .

9. Directors' Responsibility Statement

The financial statements are prepared by the Indian Accounting Standards (Ind AS) under the historical cost convention on an accrual basis except for certain financial instruments, which are measured at fair values, the provisions of the Act, and guidelines issued by SEBI. The Ind AS are prescribed under Section 133 of the Act, read with Rule 3 of the Companies (Indian Accounting

Standards) Rules, 2015, and relevant amendment rules issued thereafter. Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto used.

The Directors confirm that:

(a) In preparation for the annual accounts for the financial year ended March 31,2024, the applicable accounting standards have been followed and there are no material departures.

(b) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent 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 of the Company for that period.

(c) They have taken proper and sufficient care towards the maintenance of adequate accounting records by the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(d) They have prepared the annual accounts on a going concern basis.

(e) They have laid down internal financial controls, which are adequate and are operating effectively.

(f) They have devised proper systems to ensure compliance with the provisions of all applicable laws, and such systems are adequate and operating effectively.

All Annexures referred to in the Directors' Report have been disclosed under the Statutory Information forming part of this Annual Report.

ACKNOWLEDGEMENT AND APPRECIATION

We thank our clients, customers, vendors, investors, Shareholders, suppliers, bankers, business partners and associates, financial institutions, employee volunteers, central and state governments, and other government agencies for their continued support and encouragement of the Company during the year and look forward to their continued support in the future. We place on record our appreciation for the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation, and support.