BOARD'S REPORT

To,

The Members,

Aurangabad Distillery Limited

The Board of Directors of your Company has pleasure in presenting herewith their 24^th Annual Report of Aurangabad Distillery Limited together with the Audited Financial Statements for the financial year ended 31^st March, 2024.

FINANCIAL SUMMARY

The Company's financial performance for the year under review along with previous year's figures is given hereunder:

REVIEW OF OPERATIONS AND FUTURE OUTLOOK

The Company generated revenue of Rs. 13,069.58 Lakhs during the current year as against revenue of Rs. 11,872.15 Lakhs generated in the preceding year. The operations of the Company have resulted into post tax profit of Rs.2,092.53 Lakhs against post tax profit of Rs. 1,676.17 Lakhs in the preceding year.

The product portfolio of Company includes production of various types of Alcohol viz Rectified Spirit, Extra Neutral Alcohol, Denatured Spirit and Anhydrous Alcohol (Ethanol).

The National Policy on Biofuels set an indicative target of 20% ethanol blending under the Ethanol Blended Petrol (EBP) Program by next year. Currently petrol the OMC's are blending close to 15% Ethanol. The usage of ethanol for fuel blending creates new opportunities for the distillery industry.

DIVIDEND

Owing to the growing business needs and the necessity to plough back the profits in the business, your directors do not recommend any dividend for the year.

TRANSFER TO RESERVES

The Board of Directors does not propose to transfer any amount to general reserve during the year under review.

ANNUAL RETURN

The Company has its website; the link for Annual Return is as follows https://aurangabaddistillery.com/.

NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met Five (5) times during the year under review on 25^th May 2023, 4^th September 2023, 09th November 2023, 25^th November 2023, 22nd March 2024 respectively. Notice of meetings with agenda along with necessary details was sent to the Directors in time.

Further following are the details with respect to Board meeting attendance by each Director.

COMMITTEES OF THE BOARD

i) Audit Committee

Composition of Audit Committee of the Company as follows:

ii) Nomination and Remuneration Committee

During the year under review Mr. Avinash Salunke ceased to be a Director of the Company upon completion of his term and consequently ceased to be a Chairman of Nomination and Remuneration Committee. The Nomination and Remuneration Committee presently comprises as follows:

iii) Stakeholders Relationship Committee

During the year under review Mr. Avinash Salunke ceased to be a Director of the Company upon completion of his term and consequently ceased to be a Chairman of Stakeholders Relationship Committee. The Stakeholders Relationship Committee presently comprises as follows:

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 152 of the Companies Act, 2013, Mr. Kanayalal Kimatram Kalani and Mr. Jagjitkaur Amardeepsingh Sethi are retiring by rotation at the ensuing Annual General Meeting and being eligible have offered themselves for reappointment.

Further, during the year under review upon completion of tenure Mr. Avinash Salunke ceased to be an Independent Director of the company from 12th November, 2023 and Mr. Karan Vallabh Yadav and Mr. Tanaji Yadav has resigned from the post of Whole time Director of the company w. e. f 09th November, 2023.

Further, during the year under review, the Board based on the recommendation of Nomination and remuneration Committee has appointed Mr. Karan Vallabh Yadav as Chief Executive Officer (‘CEO') of the company for a period of five years from 10th November 2024 to 9th November 2028.

Further, during the year under review Ms. Komal Shendge has resigned from the position of Company Secretary and Compliance Officer of the Company w. e. f 20th December, 2023 and Ms. Pooja Soni has been appointed as Company Secretary and Compliance Officer of the Company w.e.f. 25th May, 2024.

DECLARATION ON FROM INDEPENDENT DIRECTORS

All Independent Directors have given Declaration that;

a. They meet the criteria for independence as laid down under Section 149(6) of the Companies Act, 2013, and Regulation 25(8) read with 16(1)(b) of the Listing Obligation and Disclosure Requirements, 2015.

b. The Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act.

In the opinion of the Board, the Independent Directors fulfil the conditions specified in the Listing Regulations and are Independent of the Management. Further there has been no change in the circumstances affecting their status as Independent Directors of the Company.

NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy is designed to attract, motivate, improve productivity and retain manpower, by creating a congenial work environment, encouraging initiatives, personal growth and team work, and inculcating a sense of belonging and involvement, besides offering appropriate remuneration packages and superannuation benefits. The policy reflects the Company's objectives for good corporate governance as well as sustained long term value creation for shareholders.

Overall, the Nomination and Remuneration Policy of the Company demonstrates the company's commitment to fostering a conducive work environment, recognizing and rewarding employee contributions, and ensuring the long-term success and growth of the organization while upholding principles of good corporate governance.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors of your Company, to the best of their knowledge and ability, confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

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

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

(d) The Directors have prepared the annual accounts on a going concern basis;

(e) The Directors have laid down proper internal financial controls and system which are adequate and are operating effectively; and

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

STATUTORY AUDITORS

In the 22nd Annual General Meeting of the Company held on 30th September 2022, members of the Company have appointed M/s. HMA & Associates, Chartered Accountants, Pune (Firm Registration No.: 100537W) as a Statutory Auditors of the Company to hold office from the conclusion of this 22nd Annual General Meeting for a period of 5 (five) consecutive financial years until the conclusion of the 27thAnnual General Meeting to be held for the financial year 2027-28.

There has been no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditors in their report except below:

Based on our examination which included test checks, the company has used such accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility. However, the audit trail facility has not been operating throughout the year for all transactions recorded in the software. Further, since the audit trail was not enabled, our comments on whether the audit trail feature has been tampered with and whether the audit trail has been preserved by the company as per the statutory requirements for record retention, are not applicable

Management Reply: Management is committed to ensuring data security and compliance with new Indian legislation by enabling audit trail logging at the database level. Further, testing has been conducted for assessing the impact on system performance and the Company has successfully implemented audit trail facility.

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no frauds reported by Auditors under Sub-Section (12) of Section 143 of the Companies Act, 2013 other than those which are reportable to the Central Government.

SECRETARIAL AUDITORS

The Board of Directors had appointed M/s. Prajot Tungare & Associates, Practicing Company Secretaries as the Secretarial Auditors of your Company to issue a Secretarial Audit Report pursuant to Section 204 of the Companies Act, 2013 for the Financial Year 2023-24. The Secretarial Auditors have given their report, which is annexed hereto as "Annexure I".

Further, as per recommendation of the Audit Committee, the Board of Director has re-appointed M/s. Prajot Tungare & Associates, Practicing Company Secretaries as Secretarial Auditors of your Company for the Financial Year 2024-25.

There has been no qualification, reservation, adverse remark or disclaimer given by the secretarial auditors in their report except below:

i. There has been delay of more than three months in appointment of Company Secretary as a Compliance officer as per Regulation 6 of the Securities and Exchange Board of India (Listing obligations and Disclosure Requirements) Regulations, 2015.

Management Reply: The Management has taken proactive actions for appointment of Company Secretary and Compliance Officer in time but the company has not received any responses. However, the company has appointed Ms. Pooja Soni as a Company Secretary and Compliance Officer of the company from 25th May 2024.

ii. The accounting software used by the Company has the feature to maintain the audit trail as per the rule 3(1) of the companies (Account) Rules, 2014 but the same was not enabled throughout the year.

Management Reply: Management is committed to ensuring data security and compliance with new Indian legislation by enabling audit trail logging at the database level. Further, testing has been conducted for assessing the impact on system performance and the Company has successfully implemented audit trail facility.

COST AUDITORS

The Company is required to have the audit of its cost records conducted by a Cost Accountant in Practice. In this connection, the Audit Committee has recommended to the Board of Directors and the Board of Directors had approved the appointment of M/s. Dargad & Associates, Cost Accountants, as Cost Auditors of the Company to conduct the Cost Audit functions for the Financial Year 2023-24.

Further, as per recommendation of the Audit Committee, the Board of Director has re-appointed M/s. Dargad & Associates, Cost Accountants, as Cost Auditors of the Company to conduct the Cost Audit functions for the Financial Year 2024-25 subject to ratification of remuneration of the cost auditor in ensuring Annual General Meeting.

The Company has maintained cost records as stated in the provisions of maintenance of Cost Records pursuant to Section 148 of the Companies Act, 2013 read with Companies (Cost Record & Audit) Amendment Rules 2014, our company maintained all the records.

INTERNAL AUDITOR

The Board of Directors had appointed M/s. S. R. Bakare & Co., Chartered Accountants as the Internal Auditor of the Company pursuant to Section 138 and other applicable provisions, if any of the Companies Act for the financial year 2023-24.

As per recommendation of the Audit Committee, the Board of Director has re-appointed M/s. S. R. Bakare & Co., Chartered Accountants as an Internal Auditor of the Company for the Financial Year 2024-25.

SHARE CAPITAL

The paid-up share capital of the Company as on 31st March 2024 was Rs. 8.20 Crores. During the year under review the Company has not issued any types shares.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of loans given, investments made, guarantees given and securities provided during the year are mentioned in the table herein-below:

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

The transactions entered by the Company with related parties were in ordinary course of business and at arm's length basis. The particulars of transactions entered with related parties are annexed herewith as "Annexure II" to this report.

MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THEFINANCIAL POSITION OF THE COMPANY

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

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars prescribed under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are set out in Annexure - III to this Report.

DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

The Company has a robust risk management framework that includes a well-defined risk governance structure and established processes. It proactively identifies and assesses all strategic, operational, and financial risks by analyzing the most up-to-date risk information from both internal and external sources. This valuable insight is then utilized to plan and implement risk mitigation activities effectively.

INTERNAL FINANCIAL CONTROLS

The Company has implemented comprehensive procedures to ensure robust internal financial controls. It consistently adheres to industry best practices to safeguard its assets, prevent and detect frauds and errors, maintain the accuracy and completeness of accounting records, and ensure the timely preparation of reliable and accurate financial information.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES AND THEIR POSITION & FINANCIAL PERFORMANCE

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

DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BYTHE REGULATORS OR COURTS IMPACTING THE GOING CONCERNSTATUS AND COMPANY'S OPERATIONS IN FUTURE PURSUANTTO RULE 8(5)(VII) OF COMPANIES (ACCOUNTS) RULES, 2014

The Company has not received any significant or material order passed by regulators or courts or tribunals impacting the Company's going concern status or the Company's operations in future except the below:

The Company received an order for the payment of duty on rectified spirit from the Commissioner of State Excise, Mumbai, Maharashtra. Further, the Minister of State Excise has issued a stay on the Commissioner's order.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

Management's Discussion and Analysis Report for the year under review, as stipulated under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is presented in "Annexure-IV" to this report.

PERFORMANCE EVALUATION

The Company has developed a comprehensive policy for evaluating the performance of the Board, Committees, and individual Directors, including Independent Directors and Executive Directors. This policy encompasses various criteria for assessing the performance of Non-executive Directors and Executive Directors. The evaluation process takes into account factors such as Directors' attendance at Board and Committee Meetings, understanding of the Company's business, effective communication among Board members, active participation, domain knowledge, adherence to the code of conduct, vision and strategy, and benchmarks set by global peers. Importantly, this evaluation process ensures compliance with all relevant laws, regulations, and guidelines.

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out performance evaluation of its own performance and that of its committees and individual Directors.

PARTICULARS OF EMPLOYEES

Disclosure as per Section 197(12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as "Annexure -V" to this report.

VIGIL MECHANISM

The Company has a vigil mechanism named as Whistle Blower Policy of the Company in compliance of provisions of section 177(10) of the companies Act 2013, an avenue to raise concern and access in good faith the Chairman of the Audit Committee which provide for adequate safeguard against victimization of person.

The Policy on Whistle Blower Policy is available on the website of the Company under the weblink www.aurangabaddistillery. com

As per requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has designed and implemented a comprehensive policy and framework to promote a safe and secure work environment, where every person at the workplace is treated with dignity and respect. Moreover, the Company's policy is inclusive and gender neutral. Further, the complaint redressal mechanism detailed in the policy ensures complete anonymity and confidentiality.

Internal Complaint Committee (ICC) have been constituted as per the requirement with the highest governance norms. During the year under review, there was no complaints received pursuant to the aforesaid Act.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVE

Pursuant to the Section 135(9) of the Companies Act, 2013, the CSR Committee is not required to be constituted if an amount to be spent by the Company in a year does not exceed Rs. 50 Lakhs. Currently, the CSR liability for the Company is less than Rs.50 Lakhs. Hence all functions for fulfilling CSR liability shall be carried out by the Board of Directors of the Company.

Pursuant to Rule 8 of the Companies (CSR Policy) Rules, 2014 the detailed Report on CSR Activities for the financial year 2023-24 is enclosed as "Annexure- VI".

INSOLVENCY AND BANKRUPTCY CODE UPDATE

No application has been made / No proceeding is pending under the Insolvency and Bankruptcy Code, 2016 during the year under review.

VALUATION FOR ONE TIME SETTLEMENT WITH BANK AND FINANCIAL INSTITUTION

The Company has not made any valuation for one-time settlement with Bank and financial Institution. Hence, there is no reason for elaboration on the said aspect.

OTHER MATTERS

Your directors state that no reporting is required in respect of the following items for the reasons mentioned therein:

1. There is no change in the nature of business.

2. There were no complaints relating to child labour, forced labour or involuntary labour during the financial year 202324.

3. Your Company does not have employee stock option scheme.

ACKNOWLEDGEMENTS

Your directors place on records their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your directors also acknowledge gratefully the shareholders for their support and confidence reposed on your Company.