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Dear Share Holders :

Your Directors are pleased to present before you the 80th Annual Report and the Audited Statement of Accounts for the year ended 31stMarch, 2024 :-

1. FINANCIAL RESULTS

(Rs. in Crores)

2. PERFORMANCE

The annual turnover of the Company has declined by about 4.5% to Rs. 1370.86 Crores during the current financial year against Rs. 1435.25 Crores in the previous year.

The EBITDA (Earnings before Interest, Tax and Depreciation) stood at Rs. 134.39 Crores (9.80%) v/s Rs. 144.70 crores (10.08%) during the previous year.

After a charge of interest of Rs. 30.50 Crores (H 25.33 Crores), depreciation of Rs. 26.77 Crores (H 26.63 Crores) and tax of Rs. 21.95 Crores (H 22.60 Crores), the Net Profit after tax came at Rs. 55.62 Crores (H 70.14 Crores) for the year.

The volume of our production & sales was higher as compared to the last year. However, the sales of our high value products were affected due to continuous pricing pressure and weak demand from FMCG / Pharma sector – major users of our key products. In consequence to the lower sales of high value products & lower offtake thereof, our EBITDA and profit margins were adversely affected during the year. FMCG sector has currently reported uptick in demand due to positive rural reponse and we expect that our high value products will re-take the charge of our sales & profits during the running year.

3. DIVIDEND AND DIVIDEND DISTRIBUTION POLICY

The Company had declared and paid an interim dividend of Rs. 8/- per Equity Share of face value Rs. 10/- each (i.e. 80%) in the month of January, 2024. The Board has considered the said interim dividend of Rs. 8 per equity share as the final dividend for the financial year 2023-24 (H 8/- per equity share during FY 2022-23) in order to conserve resources for future expansions in the operations of the Company. The dividend recommended is in accordance with the Company's Dividend Distribution Policy. The Policy, in terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ('SEBI Listing Regulations') is available on the Company's website on https://www.sukhjitgroup.com/dividend-distribution-policy.

4. TRANSFER TO RESERVES

After payment of the interim dividend of Rs. 12.50

Crores in January, 2024, the Company has been left with a surplus Rs. 67.87 Crores out of which H40 Crores have been transferred to the general reserves (PY Rs. 50 Crores) and Rs. 27.87 Crores have been carried forward in the Retained Earnings Account.

5. SHARE CAPITAL

The paid up share capital of the Company stood at Rs. 15.62 crores as on 31.03.2024. There was no issue of fresh shares by way of public issue, bonus issue, right or preferential issue during the financial year 2023-24.

6. CAPEX & WORKING CAPITAL POSITION

The total Net Block (including capital work-in progress) of the Company appeared at Rs. 524.61 Crores as on

31.03.2024 against Rs. 512.53 Crores as on 31.03.2023 after providing depreciation of Rs. 26.77 Crores during the year (H 26.63 Crores).

The Company has made a Capital expenditure (on addition of fixed assets) of Rs. 39.50 Crores during the year on account of balancing / upgrading / expansion of its existing manufacturing facilities. The Board of Directors has approved Capital expenditure of Rs. 32 Crores for the financial year 2024-25, which will be used for upgrading / modernizing some key equipment of the units to improve the operations and scale up efficiencies at the existing locations. The proposed Cap-ex will be met out of the internal accruals of the company. The Current Assets of the Company appeared at Rs. 462.72 Crores on 31.03.2024 as compared to Rs. 392.30 Crores on 31.03.2023 including Inventories at Rs. 217.76 Crores against Rs. 167.67 Crores in the previous year due to higher holding of the basic raw material, which is seasonally available. Prices of basic raw material remained higher for most part of the year.

The company has long term Bank Borrowings of about 3.75 Crores (payable in a period of one year after the end of the running financial year), net of the current maturity of the term loans of Rs. 26.27 Crores payable till 31.03.2025.

The internal accruals of the company will be enough to take care of this repayment & strengthen the working capital of the company. However, company has liquid investments of Rs. 82.81 Crores against H 77.52 Crores last year as an additional cushion to the liquidity of the company. The management believes that the Company has sufficient liquid resources at hand to meet up any additional working capital requirements / other business exigencies.

7. MANAGEMENT DISCUSSION AND ANALYSIS

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis report is annexed herewith marked as 'Annexure A' and forms a part of this report.

8. CORPORATE GOVERNANCE

Your company is fully committed to the philosophy of transparency and believes in conducting its business scrupulously with due compliance of all the applicable laws, rules and regulations. In pursuance to the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended to date, the report on the Corporate Governance is annexed to this report marked as 'Annexure B'.

9. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3c) of the Companies Act, 2013, the Directors state that: (a) in the preparation of the Annual Accounts for the financial year ended 31st March, 2024, the applicable Indian Accounting Standards have been followed and there are no material departures; (b) appropriate accounting policies have been selected and applied 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 of the company for the years so ended; (c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) the Annual Accounts for the year ended 31.03.2024, have been prepared on a 'going concern' basis; (e) the internal financial controls have been laid down to be followed by the company and that such internal financial controls are adequate and are operating effectively; and (f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

10. SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

The Vijoy Steel & General Mills Company Ltd., Phagwara: The Company held 96.17% of shares in the capital of The Vijoy Steel & the General Mills Co. Ltd. The Company continued providing necessary engineering support to the manufacturing operations of the Company.

Scott Industries Ltd., Phagwara: It held 99.97% of shares in the capital of the Scott Industries Ltd. The Company has shut down its operations. Most of its assets have been already disposed of and efforts are on to realize the old dues from its customers and wind up the Company.

Sukhjit Mega Food Park & Infra Ltd., Phagwara: The Company held 100% of shares in the capital of its material subsidiary Sukhjit Mega Food Park & Infra Ltd. The Company had operationalised its project of the Mega Food Park in the state of Punjab in FY 2020-21 creating a State of Art Technology Infrastructure for setting up food processing units in the Mega Food Park. A good part of its assets have been leased out and operationalised. The Company expects to improve its revenues during the coming years. There has been no material change in the nature of business of the Subsidiaries. As required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended to date, the Consolidated Financial Statements of the Company and its subsidiaries are attached and have been prepared in accordance with the relevant Indian Accounting Standard(s) as prescribed under the Companies Act, 2013. In pursuance to the general circular issued by the Ministry of Corporate Affairs, the Balance Sheet, Profit & Loss Account and other documents of the subsidiary companies are not being annexed to the Balance Sheet of the Company. A statement containing the requisite financial details of the company's subsidiaries for the financial year ended 31st March, 2024 is annexed to the consolidated results forming part of the Annual Report.

In accordance with Section 136(1) of the Act, the audited financial statements including the consolidated financial statements and related information of the Company together with financial statements of each of the subsidiary companies, are available on the Company's website at https://www. sukhjitgroup.com. The annual accounts of these subsidiaries and the related detailed information will be made available on demand, to any shareholder of the Company who may be interested in seeking such information. Copies of the above documents are also available for inspection by any shareholder of the Company at the registered office of the Company during business hours.

11. PARTICULARS OF REMUNERATION TO DIRECTORS AND DISCLOSURES

In terms of the provisions of section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the particulars of Directors / KMPs / Employees are set out in the 'Annexure C ' to the Directors' Report.

12. DIRECTORS

(a) Smt. Manjoo Sardana (DIN: 08533106), Non Executive Chairperson of the Company, is retiring by rotation and being eligible, offers herself for reappointment. Board recommends her re-appointment as the Non Executive Chairperson of the Company.

(b) The existing tenure of Sh. Kuldip Krishan Sardana, Managing Director of the Company (DIN: 00398376) expired on 30.04.2024. The Board had, in the best interests of the Company, considered his re-appointment w.e.f 01.05.2024 to 30.09.2028 subject to the approval of the shareholders of the Company who has approved his re-appointment through postal Ballot in April 2024. Sh. Kuldip Krishan Sardana has diverse life long Managerial, Commercial & Administrative experience to his credit. He has actively managed and administered all management functions of the Company and the company has grown significantly under his able stewardship with new projects, expansions or diversified product portfolios. He has remained a major driving force and a key resource for the able guidance to all the senior executives of the company.

(c) The existing tenure of Sh. Vikas Uppal, a Non Executive Independent Director of the Company (DIN : 00796828) is expiring on 20.01.2025. Sh. Vikas Uppal is having long experience of over three decades in the manufacturing, administration and management fields. The Board of Directors has recommended his re-appointment for a further period of 5 years i.e. w.e.f. 21.01.2025 upto 20.01.2030, subject to the approval of shareholder's in the ensuing Annual General Meeting.

(d) The existing tenure of Sh. Saravjit Singh Hothi as an Independent Director of the Company is expiring on 30.05.2024 and he has expressed his inability to continue as an Independent Director due to his pre-engagements. The Board, therefore, considered his retirement and placed on record its deep appreciation for the services rendered by the retiring Independent Director Sh. Saravjit Singh Hothi as a member of the Board of Directors of the Company and Committees thereof. He regularly participated in all Board Meetings and played a commendable role in the key decisions of the Board and Committees relating to the growth of the Company or other areas concerning accountability, transparency, compliance etc.

(e) The Board of Directors, in its meeting held on 29.05.2024, co-opted Sh. Suresh Arora, I.P.S. (Retired), as an Additional Non-Executive Independent Director of the Company to hold office for a period of five years from 29.05.2024 to 28.05.2029, subject to the approval of the shareholders of the Company by way of special resolution in the ensuing Annual General Meeting.

Sh. Suresh Arora is a retired I.P.S. officer and is Post Graduate in law. He is also an associate member of The Institute of Company Secretaries of India (ICSI). He has been the Chief Information Commissioner, Punjab from 2019 to 2023 after serving as the Director General of Police, Punjab for a period of over three years i.e. from 25.10.2015 to 07.02.2019. Prior to this, he worked on various key positions in the State of Punjab. He has rich administrative, managerial & commercial experience to his credit. Board, therefore, recommends his appointment as an Independent Director in the best interest of the Company as his induction would enrich the functioning of the Board of Directors.

(f) The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence and comply with all the requirements in pursuance to sub-section (6) of Section 149 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, so as to qualify themselves to be appointed / re-appointed or to continue as Independent Directors under the provisions of the Act and rules there under. (g) Based on evaluation criteria laid down under the Nomination and Remuneration Policy of the Company, framed in accordance with the provisions of section 178 of the Companies Act, 2013, the Nomination & Remuneration Committee rates the performance of the individual directors and also the Board as a whole, which, inter-alia, include:

Evaluation of leadership abilities

Contribution to corporate objectives & growth

Regular monitoring of performance

Effective decision making ability

Attendance/Participationinthedeliberation of Board and Committee meetings The Company has in place a suitable Policy for the Appointment & Remuneration of the Directors / KMPs. The Company has devised the Board's Performance Evaluation criteria for evaluation of Board's / Committees / Directors' performance. The performance of the Committees was evaluated by the Board on the basis of the criteria such as the composition of committees and effectiveness of committee meetings etc.

The Independent Directors in their Separate Meeting reviewed the performance of Non - Independent Directors, the composition & performance of the Board of Directors as a whole, frequency of Board meetings etc. The Independent Directors also reviewed the performance & participation of the Chairperson of the Company. Such proceedings were placed on record and discussed in the Board Meeting following the meeting of the Independent Directors. The Board of Directors expressed their satisfaction over the evaluation process.

13. MEETINGS OF THE BOARD

Six (6) meetings of the Board of Directors were convened and held during the financial year 2023-24. The maximum intervening gap between the meetings was within the limits prescribed under the provisions of Section 173 of the Act and Listing Regulations. The further details of Board / Committee Meetings including composition and attendance are set out in the 'Annexure B' the Corporate Governance Report, forming part of this Report.

14. AUDIT COMMITTEE

The powers, role and terms of reference of the Audit Committee cover the areas as contemplated under Section 177 of the Companies Act, 2013 ('the Act') and Regulation 18 of the SEBI (LODR) Regulations, 2015, as applicable, besides other matters as referred by the Board of Directors from time to time. The primary objectives of the audit committee inter-alia include:

• to monitor and provide an effective supervision of the Management's financial reporting process,

• to ensure accurate and timely disclosures with highest levels of transparency, integrity and quality of financial reporting,

• to oversee the financial reporting process by the Management, the internal auditors and the independent auditors,

• to take all possible measures to ensure the objectivity and independence of the independent auditors.

The Committee mandatorily reviews information such as internal audit reports related to internal control weakness, management discussion & analysis and operational results, statement of significant related party transactions and such other matters as prescribed. During the year under reference, the Audit Committee of the Company consisted of Sh. Ranbir Singh Seehra as the Chairman, Sh. Vikas Uppal, Sh. Saravjit Singh Hothi and Sh. M. G. Sharma as its members. All recommendations made by the Audit Committee during the year were accepted by the Board.

15. INTERNAL FINANCIAL CONTROLS

Internal financial control systems of the company provide for proper authorization of the transactions, timely recording & reporting in the desired manner to ensure the reliability of financial reporting, timely feedback on the achievement of operational or strategic goals and compliance with all the applicable laws & regulations. The Internal & External Auditors of the Company also measure the effectiveness of internal controls through periodical checks and ensure that company has an effective internal control system duly commensurate with its size and nature of business. The management reviews the systems periodically to systematically improve business processes in regard to their effectiveness and efficiency The Company has implemented audit trail on the books of accounts.

16. VIGIL MECHANISM

Pursuant to Section 177 of the Companies Act, 2013 & rules made thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a vigil mechanism, which also incorporates a Whistle Blower Policy, for Directors and employees of the Company to report genuine concerns of unethical behavior or violation of code of conduct by way of direct access to the Chairman of the Audit Committee. There are adequate safeguards against victimization of employees / directors who express their concerns. The Whistle Blower Policy of the Company stands placed on the Company's website at the link: https:// www.sukhjitgroup.com/whistle-blower-policy.

17. RISK MANAGEMENT POLICY

The company recognizes that the risk management and internal controls are the key elements for sustainable working of an organization and good corporate governance. It has formulated the Risk Management Policy which describes the manner in which the company identifies, assesses, monitors and manages risks. The details of the policy are available at company's website at https://www.sukhjitgroup. com/risk-management-policy.

18. GENERAL DISCLOSURE

(i) All the deposits have been accepted / renewed / repaid as per the provisions of the Companies Act. The company had no unclaimed / unpaid deposits on 31.03.2024. (ii) Unsecured Loans as on 31.03.2024 include Rs. 0.58 Crores (P.Y. Rs. 0.55 Crores) received from directors, which have been made out of their own funds and not from the funds acquired by them by borrowing or accepting loans or deposits from others, as per the declarations received from the concerned directors.

(iii) The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors, Committee Meetings and the General Meetings.

(iv) No shares have been issued during the year under reference with differential rights as to dividend, voting or otherwise.

(v) There is no significant and material order passed by any Regulator, Court, Tribunal which may impact the going concern status of the Company and Company's operations in future.

(vi) There are no material changes or commitments affecting the financial position of the Company which occurred between the end of the financial year to the date of this report.

(vii) There is no Corporate Insolvency Resolution Process initiated against the Company or any of its subsidiaries under the Insolvency and Bankruptcy Code, 2016.

(viii) There is no change in the nature of company's business during the year under review.

(ix) There was no instance of fraud during the year under reference which required the Statutory Auditors to report to the Audit Committee and / or to the Board under Section 143(12) of Act and Rules made there under.

(x) The Board has constituted an Internal Committee for redressal of grievance(s) / complaint(s) (if any) under the provisions of the ''Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013''. The committee has not received any complaint during the year under reference. (xi) In view of the relaxation(s) granted by MCA / SEBI and as per the Green Initiative taken by MCA, the Company has been serving to its shareholders all Notices, communications / documents including Annual Reports, Circulars etc. through electronic mode. (xii) There has been no default in repayment of deposits or payment of interest there on during the year.

(xiii) There was no instance during the year where the recommendations of any committee were not accepted by the Board.

(xiv) There was no instance of one time settlement with any Bank or Institution.

19. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The report on Corporate Social Responsibility activities carried out during the financial year 2023-24 is annexed herewith marked as 'Annexure D' forms part of this report.

20. INSIDER TRADING PREVENTION CODE

Pursuant to the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 and amendments thereto, the Company has adopted an Internal Code of Conduct for Regulating, Monitoring and Reporting of Trades in securities of the Company by the Designated Persons. The Code seeks to prevent Insider Trading by the Directors and other Designated Persons who are considered to have access to the Unpublished Price Sensitive Information relating to the Company.

21. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The Company has not entered into any material transaction with its Directors, Key Managerial Personnel or their Relatives which could have potential conflict with the interest of the Company. The salaries / remuneration of the directors and KMPs have been fixed after due consideration and approval by the Nomination and Remuneration Committee / Board / Shareholders as per applicable provisions of the Act. The transactions with the subsidiary companies mainly include the supply of some key infrastructural facilities and utilities by Sukhjit Mega Food Park and Infra Ltd., which is a wholly owned subsidiary of the Company. However, the transactions with subsidiary Companies are incurred after due appraisal, approval(s) at appropriate levels and omnibus approval by the Audit Committee / Board, which are in the ordinary course of business and are at an arm's length price. In terms of INDAS-24, the details of such transactions are duly presented in the Notes to Accounts forming part of the Annual Report. Policy on related party transactions of the company appears on the Company's website at the link: https:// www.sukhjitgroup.com/policy-on-dealing-with-related-party-transactions.

22. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED

Particulars of loans given and Investments made by the Company are provided in the standalone financial statements. The Company has given / provided some Guarantees / Securities to the Govt. / other Departments in the ordinary course of business. The company has also provided Corporate guarantee(s) for Rs. 40 Crores to the Yes Bank Ltd. against the Term Loan for setting up the Mega Food Park by its wholly owned subsidiary M/s Sukhjit Mega Food Park & Infra Ltd. The outstanding balance of term loan appeared at Rs. 18 Crores due to the Yes Bank Ltd. as on 31.03.2024. There is no other Guarantee / third party Guarantee / security given / provided by the Company.

23. EXTRACT OF ANNUAL RETURN

Extract of the Annual Return of the Company is annexed herewith as 'Annexure E' to this report. A copy of the same has also been placed on Company's website at the link : https://www.sukhjitgroup.com/ annual-return.

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

The necessary details are annexed herewith as 'Annexure F' to this report.

25. TRANSFER TO INVESTOR EDUCATION & PROTECTION FUND (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules), the company has transferred 8,000 shares to the demat account of the IEPF Authority during FY 2023-24 on which dividend has not been paid / claimed by the shareholders for 7 (seven) consecutive years or more.

Statutory Auditors:

Pursuant to the provisions of section 139 and 142 of The Companies Act, 2013 and other applicable provisions, if any, of the Companies Act, 2013 or any amendments or enactments thereof, M/s Y K Sud & Co., Chartered Accountants (FRN 000047N) were appointed as Statutory Auditors of the Company in the Annual General Meeting held on 12/08/2022 for a period of 5 years and their tenure expires on the conclusion of 83rd Annual General Meeting of the Company to be held in the year 2027. They have confirmed their eligibility to be appointed as Statutory Auditors of the Company. The Company has paid a sum of _ 7.08 Lakhs (incl. GST) (PY _ 7.08 Lakhs) to M/s Y K Sud & Co., Chartered Accountants as audit fees during the Financial Year ended 31st March, 2024.

The Auditors' report for the financial year ended 31.03.2024 does not have any qualification, reservation, adverse remark or disclaimer by the statutory auditors.

Cost Auditors:

The Board of Directors recommends the re-appointment of M/s Khushwinder Kumar & Associates, Cost Accountants, as Cost Auditors of the Company for the financial year 2024 - 25, subject to the approval of the Central Government. The Cost Audit Report for the financial year ended 31st March, 2024 is due to be filed with the Ministry of Corporate affairs on or before the 30th September, 2024 and the cost audit report for the financial year ended 31/03/2023 was duly filed within the due dates.

Secretarial Auditors:

The Board has re-appointed M/s Dinesh Gupta & Co., Practicing Company Secretaries, as Secretarial Auditors for the Financial Year 2024-25. The Secretarial Audit Report for the financial year ended 31st March, 2024, in relation to compliance of Section 204 of the Companies Act, 2013 and all applicable SEBI Regulations / circulars / guidelines issued thereunder, pursuant to requirement of Regulation 24A of Listing Regulations along with the Secretarial Audit Report of the material subsidiary company is set out in 'Annexure H' to this report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

27. ACKNOWLEDGEMENT

Your Directors hereby acknowledge the dedication, loyalty, hard work and committed services of the executives, staff & workers of the Company. They also like to place on record their appreciation for the continued co-operation and support received by the Company during the year from bankers, financial institutions, government authorities, business associates, shareholders, vendors, customers and other stakeholders and for the confidence reposed in the Company and its management and look forward to their continued support.