FOR THE YEAR ENDED MARCH 31, 2024

Dear Shareholders,

Your Directors have pleasure in presenting the 48^th Annual Report of the Company together with the Audited Statement of Accounts for the year ended 31^st March, 2024.

Summary of Financial performance of the Company for the Financial Year 2023-24 is depicted below:

STATE OF AFFAIRS OF THE COMPANY AND FUTURE OUTLOOK:

The overall performance of the company is better in spite of low yielding cotton seed and global uncertainty. This is due to improved procurement of cotton seed through electronic auctions conducted by Cotton Corporation of India (CCI) which paved for better utilization processing capacity during FY2023-24. The company could process 60,516 MT (35,121 MT in the previous year) and yields were low compared to last year. However the company could realize better prices for oils and other products and made bottom line look healthy.

The Company is looking forward for export of cotton linters which has sluggish demand from Chinese market. Even Hulls, de-oiled cakes have moderate demand where prices are highly competitive with low margins. In spite of the above challenges, the company could achieve a turnover of Rs.18,324.03 Lakhs as against Rs.12,860.55 Lakhs in the previous year and a net profit of Rs.130.11 Lakhs as against net loss of Rs.228.66 Lakhs in the previous year.

Wind Turbine Generators could contribute an income of Rs.36.32 Lakhs as against Rs.33.47 Lakhs in previous year.

The company is planning to open more seed procurement centers in Telangana, where production of cotton crop is likely to be more.

The company is looking forward for alternative markets for cotton linters in view of war tensions in Israel, Egypt, Iran, Russia and Ukraine countries.

Government of India is also proposing to levy import duty on oil imports so as to encourage the domestic farmers to improve the oil seeds cultivation and to augment edible oil production to cater the huge demand in domestic market.

As the weather forecast given by IMD is very positive in cotton growing areas, which may help to yield better volumes and improve the availability of cotton seeds. Your Directors are optimistic in utilising the full production capacities to ensure better working results in the ensuing years.

Your Directors wish to inform that the Company has exported 2962.540 M.T. of Cotton Linters worth Rs. 786.79 lakhs during the year under review as against 202.730 M.T. of Cotton Linters Rs. 47.99 lakhs in the previous year.

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2024 is available on the Company’s website at www.capol.in.

The Board has recommended a Dividend during the year for the financial year 2023-24. The Directors are pleased to recommend a dividend of Rs 1.00 per share (i.e. 10%) on the Equity Shares of the Company of Rs.10/- each for the year ended March 31, 2024. If the dividend, as recommended above, is declared by the Members at the ensuing Annual General Meeting (‘AGM’), the total outflow of cash towards dividend on Equity Shares for the year would be Rs 7,90,000/-.

During the current financial year, there is no change occurred in the capital Structure of the company.

MANAGEMENT DISCUSSION AND ANALYSIS:

The Management Discussion and Analysis Report, as required under regulation 34 of the SEBI (LODR) Regulations 2015, forms part of the Annual Report as ANNEXURE NO : V at Page No.37

i. During the year Mr. Maddi Venkateswara Rao (DIN- 00013393), reappointed under retire by rotation under Article 122 of the Articles of Association of the Company in the 47th AGM of the company.

ii. During the year Mr. Maddi Ramesh (DIN- 00013394), reappointed under retire by rotation under

Article 122 of the Articles of Association of the Company in the 47th AGM of the company.

iii. Re-Appointment of Whole Time Director, CEO & KMP:- During the year Subject to approval of shareholders at this ensuing Annual General Meeting of the company, the Board has re-appointed Sri. Meadem Sekhar (DIN: 02051004) as a Whole Time Director, CEO & KMP of the company with effect from 01-04-2024 for a period of five years i.e., 01.-04-2024 to 31-03-2029.

iv. During the year Sri Vadlamani Venkata Subramanya Ravi has completed his tenure as an independent

Director with effect from 31.03.2024.

v. During the year Sri Vadlamani Venkata Subramanya Ravi has been appointed as Additional Director under Non executive and Non Independent Category with effect from 01-04-2024, and the said appoint shall be subject to the approval of the shareholders in the ensuing Annual General meeting of the Company by way of Special Resolution. ii) AFTER THE END OF THE FINANCIAL YEAR AND UP TO THE DATE OF THIS REPORT:- NIL DIRECTORS LIABLE TO RETIRE BY ROTATION AT THE ENSUING ANNUAL GENERAL MEETING:

1. Mr. Mr. Maddi Venkateswara Rao (DIN- 00013393), retire by rotation under Article 122 of the Articles of Association of the Company and being eligible, offer himself for reappointment as Director. The Board recommends his reappointment.

2. Mr. Maddi Ramesh (DIN- 00013394), retire by rotation under Article 122 of the Articles of Association of the Company and being eligible, offer himself for reappointment as Director. The Board recommends his reappointment.

Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an annual evaluation of its own performance, performance of the Directors as well as the evaluation of the working of its Committees. The NRC has defined the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and Directors. The performance of the Board and individual Directors was evaluated by the Board after seeking inputs from all the Directors. The performance of the Committees was evaluated by the Board after seeking inputs from the Committee Members. The criteria for performance evaluation of the Board included aspects such as Board composition and structure, effectiveness of Board processes, contribution in the long term strategic planning, etc. The criteria for performance evaluation of the Committees included aspects such as structure and composition of Committees, effectiveness of Committee meetings etc. The above criteria for evaluation was based on the Guidance Note issued by SEBI.

In a separate meeting, the Independent Directors evaluated the performance of Non-Independent Directors and performance of the Board as a whole. They also evaluated the performance of the Chairman taking into account the views of Executive Directors and Non-Executive Directors. The NRC reviewed the performance of the Board, its Committees and of the Directors. The same was discussed in the Board Meeting that followed the meeting of the Independent Directors and NRC, at which the feedback received from the Directors on the performance of the Board and its Committees, was also discussed. Significant highlights, learning and action points with respect to the evaluation were discussed by the Board.

In terms with Section 149 (7) of the Companies Act, 2013, all the Independent Directors of the Company have declared that they meet the criteria of Independence in terms of Section 149(6) of the Companies Act, 2013 Regulation 16(1)(b) of the SEBI(LODR) Regulations, 2015. In the opinion of the Board, they fulfil the conditions of independence as specified in the Act and the Rules made thereunder and are independent of the management.

During the year under review, two meetings of Independent Directors was held on 10.02.2024 & 26.03.2024 in compliance with the requirements of Schedule IV of the Companies Act, 2013. Two independent directors viz., Mr. V.V.S.Ravi and Mrs. R Lakshmi Sarada, have attended to the meeting held by them on 10.02.2024 and Three independent directors viz., Mr. V.V.S.Ravi, Mrs. R Lakshmi Sarada and Mr. Lakkaraju Shyam Prasad, have attended to the meeting 26.03.2024. The Independent Directors at their meeting, inter alia, reviewed the Performance of Non-Independent Directors and Board as a whole performance of the Chairperson of the Company, taking into account the views of Executive Director and Non-Executive Directors. Assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

During the Financial Year 2023-24, Five (5) Meetings of the Board of Directors of the Company were held as prescribed under the Act.

During the Financial Year 2023-24, 47^th Annual General Meeting of the Company was held on 25.09.2023. Except the 47^th Annual General Meeting, no other meeting of the members was held in financial year 2023-24.

In conformity with the provisions under Section 134 (3) (c) which is introduced by the Companies Act, 2013 your directors confirm that:-

a) in the preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) the Directors have selected sound accounting policies and applied them consistently and made judgements 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 profit of the Company for the year ended on that date; 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 internal financial controls to be followed by the Company and that such internal financial controls are adequate and are 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.

(a) BRIEF DESCRIPTION OF TERMS OF REFERENCE :

The Terms of Reference of this committee cover the matters specified for Audit Committee under Section 177 of the Companies Act, 2013, and as follows:

a. Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible. b. Recommending the appointment and removal of external auditor, fixation of audit fee and approval for payment for any other services. c. Reviewing with management the annual financial statements before submission to the Board, focusing primarily on:

- Any changes in accounting policies and practices

- Major accounting entries based on exercise of judgment by management

- Qualifications in draft Auditors’ Report

- Significant adjustments arising out of audit

- The going concern assumption

- Compliance with stock exchange and legal requirements concerning financial statements

- Any related party transactions i.e. transactions of the company of material nature, with promoters or the management, their subsidiaries or relatives etc., that may have potential conflict with the interests of the Company at large. d. Reviewing with the management, external and internal auditors, and the adequacy of internal control systems. e. Reviewing the adequacy of internal audit function, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit. f. Discussion with internal auditors of any significant findings and follow up there on. g. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board. h. Discussion with external auditors, before the audit commences, the nature and scope of audit as well as have post audit discussion to ascertain any area of concern. i. Reviewing the Company’s financial and risk management policies. j. Other matters as assigned/specified by the Board from time to time. k. The scope of the Audit Committee also includes matters which are set out in SEBI (LODR)

Regulations 2015 and the rules made there under, as amended from time to time.

As on 31^st March, 2024, The Audit Committee comprises of Three Independent cum Non-Executive Directors. The committee comprises as follows:

During the year, the Audit Committee was constituted under Section 177 of the Companies Act, 2013 and its meetings were held five times during the year ended March 31, 2024.

The current policy is to have an appropriate mix of executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. As on March 31, 2024, the Board consists of six members, three of whom are independent directors. The Board periodically evaluates the need for change in its composition and size.

The policy of the Company on directors’ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub-section (3) of section 178 of the Companies Act, 2013, adopted by the Board is recommended by the Nomination and Remuneration Committee. We affirm that the remuneration paid to the directors is as per the terms laid out in the nomination and remuneration policy of the Company.

The Company had constituted the Nomination and Remuneration Committee under Section 178 of the Companies Act, 2013. The scope of the Committee also includes matters which are set out in SEBI (LODR) Regulations, 2015 and the rules made there under, as amended from time to time. The broad terms of reference are to determine and recommend to Board, appraisal of the performance of the Managing Directors/Whole-time Directors and to determine and advise the Board for the payment of annual commission/compensation to the Non-Executive Director and to recommend to the Board appointment/reappointment and removal of Directors. To frame criteria for determining qualifications, positive attributes and Independence of Directors and to create an evaluation framework for Independent Directors and the Board.

The Nomination and Remuneration Committee comprises of total three Non-Executive Directors cum Independent Directors and it meets three times in the year. The committee comprises as follows:

The Committee held three meetings during the year ended March 31, 2024.

The Independent Directors Committee comprises of total three Non-Executive Directors cum Independent Directors and it meets twice in a year.

The committee comprises as follows:

The Committee held two meetings during the year ended March 31, 2024.

The Board has based on recommendations of the Nomination and Remuneration Committee, laid down following policies: 1. Policy for Determining Qualifications, Positive Attributes and Independence of a Director

2. Policy for Board & Independent Directors’ Evaluation

Based on the criteria laid down in the Policy for evaluation of Board and Independent Directors, the Board carried out the annual performance evaluation of Board Committees and the Independent Directors, whereas at a separate meeting, Independent Directors evaluated the performance of Executive Directors, Board as a whole and of the Chairman. Nomination and Remuneration Committee also evaluated individual directors’ performance. i) As per the said Policy, evaluation criteria for evaluation Board inter alia covers: Composition in light of business complexities and statutory requirements; establishment of vision, mission, objectives and values for the Company; laying down strategic road map for the Company & annual plans; growth attained by the Company; providing leadership and directions to the Company and employees; effectiveness in ensuring statutory compliances and discharging its duties / responsibilities towards all stakeholders; Identification, monitoring & mitigation of significant corporate risks; composition of various committees, laying down terms of reference and reviewing committee’s working etc.

ii) Performance evaluation criteria for Executive Directors inter alia include: level of skill, knowledge and core competence; performance and achievement vis-?-vis budget and operating plans; effectiveness towards ensuring statutory compliances; discharging duties/responsibilities towards all stakeholders; reviewing/monitoring Executive management performance, adherence to ethical standards of integrity & probity; employment of strategic perception and business acumen in critical matters etc.

iii) Performance of Independent Directors is evaluated based on: objectivity & constructivity while exercising duties; providing independent judgment on strategy, performance, risk management and Board’s deliberations; devotion of sufficient time for informed decision making; exercising duties in bona fide manner; safeguarding interests of all stakeholders, particularly minority shareholders; upholding ethical standards of integrity & probity; updating knowledge of the Company & its external environment etc.,

iv) Committees of the Board are evaluated for their performance based on: effectiveness in discharging duties and functions conferred; setting up and implementation of various policies, procedures and plans, effective use of Committee’s powers as per terms of reference, periodicity of meetings, attendance and participation of committee members; providing strategic guidance to the Board on various matters coming under committee’s purview etc.,

The Committee has formulated Policy for Remuneration of Directors, Key Management Personnel and other employees. As per the Policy, remuneration to Non-executive Independent Directors include:

a. Sitting Fees for attending meetings of the Board as well as Committees of the Board as decided by the Board within the limits prescribed under the Companies Act. b. Travelling and other expenses they incur for attending to the Company’s affairs, including attending

Committee and Board Meetings of the Company.

? REMUNERATION TO EXECUTIVE DIRECTORS :

The appointment and remuneration of Executive Directors including Managing Director, Joint Managing Director and Whole Time Director is governed by the recommendation of the Remuneration and Nomination Committee, resolutions passed by the Board of Directors and Shareholders of the Company. The remuneration package of Whole Time Director, comprises of salary, perquisites, allowances and other retirement benefits as approved by the shareholders at the General Meetings of the Company.

? REMUNERATION TO NON-EXECUTIVE DIRECTORS :

The Non-Executive Directors are paid remuneration by way of Sitting Fees. The Non- Executive Directors are paid sitting fees for each meeting of the Board and Committee of Directors attended by them.

The provisions of section 135 of the Act, read with Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable to the Company during the year.

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Corporate Governance

Report with auditors’ certificate thereon shall not be mandatory for the Company.

The Company has set up vigil mechanism to enable the employees and Directors to report genuine concerns and irregularities, if any in the Company, noticed by them. The Whistle Blower Policy/ vigil mechanism (as amended) has been posted on the Website of the Company i.e., www.capol.in

There were no Loans, Guarantees, Investments and securities given/made/provided by the Company during the Year.

All related party transactions that were entered during the financial year were on at arm’s length basis and were in the ordinary course of business. There are no related party transactions made by the Company which may have a potential conflict with the interest of the Company at large and thus disclosure in Form AOC-2 is not required and the Details of Transactions with the related parties were mentioned in the Notes forming part of the Accounts.

There are no significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company.

The Board of Directors of your company, has decided not to transfer any amount to the Reserves for the year under review

i. STATUTORY AUDITORS :

M/s. Nataraja Iyer & Co., Chartered Accountants were appointed as Statutory Auditors of your Company at the Annual General Meeting held on 19-09-2022, for second term of five consecutive years. The Company has received confirmation from the Auditors to the effect that their appointment, if made, will be in accordance with the limits specified under the Companies Act, 2013 and the firm satisfies the criteria specified in Section 141 of the Companies Act, 2013 read with Rule 4 of Companies (Audit & Auditors) Rules 2014.

The Auditors’ Report on the financial statements of the Company for the financial year ended March 31, 2024 is unmodified i.e. it does not contain any qualification, reservation or adverse remark. The Auditors’ Report is enclosed with the financial statements forming part of the annual report.

Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has engaged services of M/s. K. Srinivasa Rao & Co, Company Secretaries in Practice, Guntur to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2024. The detailed reports on the Secretarial Standards and Secretarial Audit in Form MR- 3 are appended as an Annexure III to this Report. There were no qualifications, reservations or adverse remarks given by Secretarial Auditors of the Company.

In terms of Section 148 of the Act read with Companies (Cost Records and Audits) Rules, 2014, the Audit Committee recommended and the Board of Directors appointed M/s. Jithendra Kumar & Co, Cost Accountants (Firm Registration No. 103347), Vijayawada to conduct Cost Audit relating of the Company for the year ending 31st March, 2024. The Company has received their written consent that the appointment will be in accordance with the applicable provisions of the Act and rules framed thereunder

Members are requested to consider the ratification of the remuneration payable to M/s. Jithendra Kumar & Co, Cost Accountants (Firm Registration No. 103347), Vijayawada as has been set out in the Notice of the 48 TH AGM of the Company.

The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148 of the Act and the rules framed thereunder, and accordingly, the Company has made and maintained such cost accounts and records.

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, Cost Audit is Applicable to the company for the financial year 2023-24. M/s. Jithendra Kumar & Co, Cost Accountants (Firm Registration No. 103347), Vijayawada has carried cost audit of the company for the financial year 2023-24.

The Cost Auditor’s report for the year ended 31.03.2024 does not make any qualification, reservation or adverse remark or disclaimer in their report.

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditors have not reported any instances of frauds committed in the Company by its Officers or Employees, to the Audit Committee under Section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

There have been no material changes and commitments, which affect the financial position of the company which have occurred between the end of the financial year 31.03.2024 to which the financial statements relate and the date of this Report.

The information required to be given pursuant to Section 134 (3) (m) of the Companies Act, 2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 for the year ended March 31, 2024 is given herein and forms part of the Board’s Report (Annexure II).

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report in Annexure -IV. There were no employees in the Company as per Rule 5(2) of Chapter XIII, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Your Company firmly believes that employees are the most valuable assets and key players of business success and sustained growth. Various employee benefits, recreational and team building programs are conducted to enhance employee skills, motivation as also to foster team spirit. Company also conducts in-house training programs to develop leadership as well as technical/functional capabilities in order to meet future talent requirements. Industrial relations were cordial throughout the year.

During the year, According to the Section 134 (3) (n) of the Act, the company had laid down a policy for management of risk. The risk management framework defines the risk management approach of the Company and also includes the periodical review of such risks. The board periodically discusses the significant business risks identified by the management and the mitigation measures to address such risks.

INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORK :

The Company has an Internal Control System, commensurate with size, scale and complexity of its operations. The internal financial controls are adequate and are operating effectively so as to ensure orderly and efficient conduct of business operations. The Internal Control System of the Company has been designed to provide for:

Accurate recording of transactions with internal checks and prompt reporting. Adherence to applicable Accounting Standards and Policies.

Compliance with applicable statutes, policies and management policies and procedures. Effective use of resources and safeguarding of assets.

The Company has allocated Mr. P.L. Ranganadh and Mr. V.H. Guptha, as Internal Auditors of the Company for the Financial Year 2023-24. The Audit Committee in consultation with the Internal Auditors formulates the Scope, functioning, periodicity and methodology for conducting the internal audit. The internal auditors carryout audit, covering inter alia, monitoring and evaluating the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations and submit their periodical internal audit reports to the Audit Committee. The internal auditors have expressed that the internal control system in the Company is effective. The Board has also put in place requisite legal compliance framework to ensure compliance of all the applicable laws and that such systems are adequate and operating effectively.

Your directors confirm that the Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. Your directors confirmed that the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year Company has not received any complaint of harassment.

During the year 2023-24, the Company not received any loan from any Director.

During the year under review, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or re-enactment(s) for the time being in force).

Registrar and Share Transfer Agents of the Company are M/s Bigshare Services Private Limited, 306, 3rd Floor, Right Wing, Amrutha Ville, Opp. Yashodha Hospital, Raj Bhavan Road, Somajiguda, Hyderabad 500 082.

The Directors have devised proper systems and processes for complying with the requirements of applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems were adequate and operating effectively.

Pursuant to the provisions of section 124 of the Companies Act, 2013, the declared dividends which remained un-paid or un-claimed for a period of seven years, have been transferred by the company to the Investor Education and Protection Fund (IEPF) established by the Central Government. The following are the details of dividends paid by the Company and respective due dates for transfer of unclaimed dividend to IEPF.

Transfer to Investor Education and Protection Fund: (a) Transfer of unclaimed dividend Members are hereby informed that under the Act, the Company is required to transfer the dividend which remains unpaid or unclaimed for a period of seven consecutive years or more, to the credit of the Investor Education and Protection Fund (‘IEPF’). Accordingly, a Final Dividend for FY 2015-16 declared during the FY 2015-16 which remained unpaid or unclaimed was transferred to IEPF Authority in FY 2023-24. Transfer of shares to IEPF pursuant to the provisions of Section 124 and 125 of the act read with the IEPF Rules, all the shares on which dividends remain unpaid or unclaimed for a period of seven consecutive years or more shall be transferred to the demat account of the IEPF Authority as notified by the MCA. During the year, the Company has transferred 1,150 Equity Shares of face value of Rs.10/- each to the demat account of the IEPF Authority. The Company had sent individual notice to all the Members whose shares were due to be transferred to the IEPF Authority and had also published newspaper advertisement in this regard. The details of such dividends/shares transferred to IEPF are uploaded on the website of the Company at www.capol.in.

Your Directors wish to express their grateful appreciation for the continued co-operation received from Canara Bank, Financial Institutions, Stock Exchanges, Government Authorities, Customers, Vendors and Stakeholders during the year under review. Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The Board places on record its appreciation for the support and co-operation your Company has been receiving from its suppliers, distributors, retailers, business partners and others associated with it as its trading partners. It will be your Company’s endeavor to build and nurture strong links with the trade based on mutuality of benefits, respect for and co-operation with each other, consistent with consumer interests.

By Order of the Board of Directors For

Coromandel Agro Products and Oils Limited