Market & News

VIP CLOTHING LIMITED

The Directors of your Company are pleased to present, the 34^th Annual Report, on the working and the progress of the Company, along with audited financial statement of the Company for the financial year ended on March 31,2024 and report of the Auditors thereon.

FINANCIAL RESULTS

OPERATIONS

Revenue from operations for the financial year 2023-24 stood to ? 183.28 crore as ? 200.64 crore in the previous financial year 2022-23. There was a decrease in the revenue by 9% as compared to the previous year.

The Earnings before interest, tax, depreciation and amortisation (EBITDA) during the current year stood around negative 3% as against the 7% in the previous year.

The net loss for the financial year 2023-24, stood around ? 12.65 crore as against the net profit of ? 6.64 crore in the previous financial year 2022-23.

DIVIDEND

The Board has not recommended any dividend on Equity Share Capital for the financial year ended on March 31, 2024.

TRANSFER TO RESERVE

No amount has been transferred to General Reserve for current and previous financial year.

SHARE CAPITAL

During the year, there was no change in paid-up capital of the Company.

The Board of Directors at its meeting held on 9^th December 2022 has approved preferential issue of upto 1,01,50,000 warrants each convertible into, or exchangeable for, one equity share within the period of 18 months at a price of Rs. 44.50/- each ("Warrants") aggregating upto Rs. 45,16,75,000/- to specified Promoter(s)/Promoter Group and Non-Promoter Persons/Entities (Public) in accordance with the provisions of Section 42 and Section 62(1)(c) of the Act read with Companies (Prospectus and Allotment of Securities) Rules, 2014, Chapter V of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, Listing Regulations and such other acts/rules/regulations as may be applicable and subject to necessary approval of the members of the Company and other regulatory authorities, as may be applicable. The details are as under:

The members of the Company have given their consent by passing of special resolution through postal ballot on 10^th January 2023 approving the aforesaid preferential issue.

THE MEMBERS ARE HEREBY INFORMED THAT, PURSUANT TO THE AFORESAID ALLOTMENT OF WARRANTS AND CONSEUQENT CONVERSION OF WARRANTS INTO THE EQUITY SHARES, THE STATUS OF EACH OF THE INVESTOR WHO HAD SUBSCRIBED TO THE AFORESAID ALLOTMENT, SHALL BE SAME

AS BEFORE AND AFTER THE ISSUE/CONVERSION. THE PROMOTER & PROMOTER GROUP INVESTORS ARE CONTINUE TO BE PROMOTER & PROMOTER GROUP POST ALLOTMENT AS WELL AS CONVERSION OF WARRANTS INTO EQUITY SHARES AND REMAINING PUBLIC INVESTORS SHALL BE CONTINUE AS PUBLIC SHAREHOLDERS AND THERE WILL BE NO CHANGE IN CONTROL, WHICH WAS ALREADY DISCLOSED IN THE POSTAL BALLOT NOTICE ISSUED TO THE MEMBERS OF THE COMPANY.

SUBSIDIARY

As on March 31,2024, the Company does not have any subsidiary, Joint Ventures and Associate Companies. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL Board of Directors

Pursuant to Section 161 of the Companies Act, 2013 the Board of Directors of the Company had appointed Mr. Kishor Navandar DIN: (00164401), Ms. Vandana Kumari Bhardwaj DIN: (06839882) and Mr. Vilas Chandrakant Gupte DIN: (10509707) as an Independent Director of the Company with effect from February 13, 2024 February 14, 2024 and February 15, 2024 respectively for a period of Five years. Their appointments were approved by the members through Postal Ballot.

On March 31, 2024 Mr. Robin Banerjee, Mr. Gopal Sehjpal and Mr. Chetan Sheth Non-Executive Independent Directors of the Company retired from the Board upon completion of their second term.

As on March 31,2024 after retirement of three Independent Directors, the Board consisted of 6 (Six) Directors out of which 4 (Four) are Independent Directors and 2 (Two) are Executive Directors.

All the Independent Directors have given declarations that they meet the criteria of Independence mentioned under Regulation 16(b) of Chapter IV of SEBI's (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149(6) of the Companies Act, 2013.

Retirement by rotation

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Kapil J. Pathare (DIN: 01089517), Director of the Company, liable to retire by rotation at the ensuing Annual General meeting and being eligible have offered himself for re-appointment.

There were no changes apart from above in Directors or Key Managerial Person.

Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Companies Act, 2013, the Company has the following Key Managerial Personnel:

COMMITTEES OF THE BOARD

Pursuant to the Provisions the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Company has constituted the following committees:

• Audit Committee

• Corporate Social Responsibility Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Risk Management Committee

The details of the Committees of the Board along with their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report forming part of this Annual Report FY 2023-24.

PERFORMANCE EVALUATION OF BOARD

Pursuant to the provisions of the Companies Act, 2013 and SEBI's (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI circular no. SEBI/HO/CFD/CMD/CIR/P/2017/004 dated January 5, 2017, the Board carried out an annual evaluation of performance of its own and it's Committees and the Directors individually. At the meeting of Independent Directors held on February 13, 2024 and as per the criteria specified by SEBI all the relevant factors for evaluating the performance of the Committees and of the Board was discussed.

NUMBER OF MEETING OF THE BOARD

The Board of Directors met 4 (Four) times during the financial year 2023-24. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The details of the Board Meetings and the attendance of the Directors are provided in the Corporate Governance Report.

RELATED PARTY TRANSACTIONS

All the Related Party Transactions entered by the Company during the year under review were in the ordinary course of business, on arm's length basis and in accordance with the provisions of the Act read with the Rules issued thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. There were no material related party transactions during the year under review. Accordingly, no transactions are being reported in Form AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not given any Loans, Guarantees and also not made any Investments under Section 186 of the Companies Act, 2013.

PUBLIC DEPOSITS

Your Company has neither invited nor accepted/renewed any "Deposit" from public within the meaning of the term "Deposits" under the Companies (Acceptance of Deposits) Rules 2014, as amended from time to time.

UNSECURED BORROWING

The Company has repaid all loans taken from Directors of the Company in FY 2022-23. During the FY 2023-24 no outstanding loan from the Directors of the Company.

FIXED DEPOSIT

During the year, the Company has not accepted any fixed deposits under the Companies Act, 2013.

ANNUALRETURN

Pursuant to sub section (3) of Section 92 of the Companies Act 2013, read with relevant Rules, the Company is required to place its Annual Return on its website and provide a link of the same in the Boards' Report.

Annual Return in the prescribed Format proposed to be submitted to the Registrar of Companies for the current financial year is available in the Company's website at www.vipclothing.in

CORPORATE SOCIAL RESPONSIBILITY

The details about the initiatives taken by the Company on Corporate Social Responsibility (CSR) activities during the year are as per the annexure attached to the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as Annexure - A to this Report. The policy is available on the website of the Company www.vipclothing.in

RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY

The Company has formed a Risk Management Committee in accordance with the requirements of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness.

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of operations. These systems are routinely tested and certified by Statutory as well as Internal Auditors' and cover all offices, factories and key business areas, significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Company's internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Company's risk management systems.

VIGIL MECHANISM /WHISTLE BLOWER POLICY

The Company believes in conducting its affairs in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behaviour. In order to achieve the same, the Company has formulated a Whistle Blowers Policy to provide a secure environment and to encourage all employees and Directors of the Company, Members, customers, vendors and/ or third party intermediaries to report unethical, unlawful or improper practices, acts or activities in the Company if any and to prohibit managerial personnel from taking any adverse action against those employees who report such practices in good faith. The Whistle Blower Policy is available on the website of the Company at www.vipclothing.in.

NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The policy is available on the website of the Company ww.vipclothing.in

CORPORATE GOVERNANCE

As per Schedule V read with Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance practice followed by the Company, together with the certificate from Company's Auditors Confirming the compliance on Corporate Governance forms an integral part of this report.

FAMILIARISATION PROGRAMMES FOR DIRECTORS

Pursuant to Section 149 read with Schedule IV, Part III of the Companies Act, 2013 and Regulation 25 of the SEBI's (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company familiarizes its Independent Directors on their roles, rights, responsibilities, nature of the industry in which the Company operates, business model of the Company and its products as a regular practice.

The details related to Directors attending the Familiarisation programmes are available on the website of the Company www.vipclothing.in.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of knowledge and belief and according to the information and explanation obtained by them, the Directors make the following statement in terms of Section 134(3) (c) of the Companies Act, 2013 that:

(a) in the preparation of the annual accounts of the Company for the financial year ended on March 31,2024, 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 as at March 31,2024 and of the loss of the Company for the year ended on March 31,2024;

(c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of 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 internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively;

(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

M/s. MSKA & Associates, Chartered Accountants, Mumbai, [Firm Registration No. 105047W], the Statutory Auditors of the Company, were appointed by the Shareholders at their meeting held on September 24, 2021 for a period of 5 years i.e. up to conclusion of 36^th Annual General Meeting.

The Ministry of Corporate Affairs (MCA), had amended the relevant provision of the Act relating the requirement of placing the matter relating to ratification of appointment of Statutory Auditors by members at every Annual General Meeting. Therefore, the ratification of appointment of Auditor is not required, M/s. MSKA & Associates, Chartered Accountants will continue to hold office till conclusion of the 36^th AGM and their appointment will not be subject to ratification by the members at every intervening AGM held after 31^st AGM.

Accordingly, the Auditors have given the audit report for the year ended on March 31, 2024. The said Auditors' Report does not contain any qualifications, reservations or adverse remarks.

INSTANCES OF FRAUD, IF ANY REPORTED BY THE AUDITORS

During the year under review, There have been no instances of any fraud reported by the statutory auditors under section 143(12) of Companies Act 2013 and the Rules made thereunder to the Audit Committee of the Board.

COST RECORD AND COST AUDIT

There has been no notification till date, covering our industry for the purpose of maintenance of Cost Accounting Records and Cost Audit for the financial year 2023-24.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules made thereunder, the Company has appointed M/S. RS & MP Associates (Unique Code No. P2017MH061400) Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended on March 31,2024 is appended as Annexure - B to this Report.

The qualification, reservation or adverse remark or disclaimer made by the Secretarial Auditors in its report are selfexplanatory and therefore, there are no further explanations to be provided for in this report.

STATUTORY INFORMATION

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Account) Rules, 2014 is given in Annexure - C to this report.

The information required under Section 197(12) of the Companies Act, 2013 read with Sub Rule 2 and 3 of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Directors Report for the year ended on March 31,2024 is given in a separate Annexure - D to this Report.

None of the Employees of the Company are in receipt of Rupees One Crore and Two Lakhs per annum or Rupees Eight Lakhs and Fifty Thousand per month during the year under review.

None of the employees listed in the said Annexure are a relative of any Director of the Company. None of the employees hold (by himself or along with his spouse and dependent children) more than two per cent of the Equity Shares of the Company.

The Business Responsibility Reporting as required by Regulation 34(2)(f) of Chapter IV of SEBI's (Listing Obligations and Disclosure Requirements) Regulations, 2015, is not applicable to your Company for the financial year ending on March 31,2024.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

No significant and material orders were passed by the Regulators/Courts/Tribunals during the year which would impact the going concern status of the Company's future operations.

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY THAT OCCURRED DURING THE FINANCIAL YEAR TO WHICH THESE FINANCIAL STATEMENTS RELATE AS ON THE DATE OF THIS REPORT

No material changes and commitments affecting the financial position of the Company occurred during the financial year to which these financial statements relate as on the date of this report.

CREDIT RATING

The Credit Rating rationale as on February 22, 2024, India Ratings and Research Private Limited has affirmed the following rating with respect to the Credit Bank Facilities availed by the Company as follows:

LISTING

Equity shares of the Company are listed on the BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) and listing fees have been paid accordingly.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company strongly believes in providing a safe and harassment free workplace for each and every individual working for the Company through various interventions and practices. It is the continuous endeavour of the Management of the Company to create and provide an environment to all its employees that is free from discrimination and harassment including sexual harassment. The Company has constituted Internal Complaints Committee (ICC).

During the year under review, no complaints pertaining to sexual harassment were received by the Committee.

SAFETY, HEALTH & ENVIRONMENT

Your Company is committed to maintain its efforts in providing a safe working environment to its employees. At the same time, we are keeping our plants operational and thus, trying to contribute towards the restoration of the economic activity and provide earnings to labour and staff.

HUMAN RESOURCE

The Company takes pride in the commitment, competence and dedication shown by its employees in all areas of business.

Employees are considered to be team members being one of the most critical resources in the business which maximize the effectiveness of the Organization.

Human resources build the Enterprise and the sense of belonging would inculcate the spirit of dedication and loyalty amongst them towards strengthening the Company's Polices and Systems. The Company takes various HR initiatives to align the HR policy to the growing requirements of Business. Your Company regularly conducts technical and safety training programmes.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report on the operations of the Company, as required under the Listing Regulations is provided in a separate section and forms an integral part of this Report.

COMPLIANCE WITH SECRETARIALSTANDARDS

During the year under review, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

ACKNOWLEDGEMENT

The Directors of your Company acknowledge with deep sense of appreciation the encouragement, support and cooperation received by the Company from its Bankers viz. State Bank of India, IDBI Bank Limited, HDFC Bank Limited and BSE Limited, National Stock Exchange of India Limited, Members; Suppliers and Esteemed Customers and Employees of the Company.

CAUTIONARY STATEMENT

Statement made in the Annual Report including those stated under the caption "Management Discussion and Analysis" describing the Company's plan, projections and expectations may constitute "forward looking statement" within the meaning of applicable laws and regulations. Actual results may differ materially from those either expressed or implied.