Share Wealth

Your directors have pleasure in presenting their Report for the financial year ended 31^st March 31, 2023. Financial Results

The Audited Financial Statements (both Standalone and Consolidated) for the year ended March 31, 2023, and the report of the Auditors thereon are being circulated with this report. The salient features of the financial results are as follows:

Performance Review & State of Company's Affairs

Your company has posted highest revenue during the year under review. The standalone total income during the year under review is Rs. 2,33,148 Lakhs - an increase of 3% over the previous year and the consolidated total income is Rs.2,33,105 Lakhs increased by 3% over the previous year.

Cement Division registered a Gross Turnover of Rs. 1959.42 Crores which was higher by around 1% in comparison with the previous year. Higher input costs particularly coal and power resulted in lower profitability during the current year.

The year under review witnessed a 27% rise in the Turnover of the Boards Division at Rs.200.36 Crores (Previous Year Rs.157.84 Crores) and profit before tax improved by 82% to Rs.18.77 crores (Previous year Rs.10.31 crores).

The generation of hydel power during the year also registered a slight improvement by 1% at 39.51 million units compared to 38.94 million units in the previous year.

The Ready Mix Concrete Division Turnover decreased by 7% at 111.04 Crores compared to Rs.119.95 Crores in the previous year.

The Readymade Doors division registered a Turnover of Rs, 33.57 Crores compared to Rs.26.12 Crores in the previous year i.e an increase of around 29% during the year under review.

The company made a standalone profit of Rs.44.34 Crores (after tax) during the year under review compared to Rs.97.43 Crores in the previous year.

The overall profitability (PBT) fell during the year under review mainly due to the dip in the performance of the Cement Division compared with the previous year. Abnormal rise in the cost of coal and fuel and other input costs were the main factors responsible for the reduced profitability during the year. However, there is an improvement in net realization and sales of the Boards Division during the year under review.

Subsidiary Companies /Acquisitions / Joint Ventures

As reported in the previous year, Tern Distilleries (P) Limited (TDPL) the wholly owned subsidiary of the company was acquired mainly to utilize its land situated near Visakhapatnam for establishment of a new grinding unit. The approval and clearances from the Government of India to set up the unit are awaited.

The application for striking off the name of NCL Guangzheng Structures Ltd, the aborted Joint Venture Company with Quingdao Xinguangzheng Steel Structure Co Ltd, China from the Register of Companies was approved during the current year. The name of the said company has since been deleted from the Register of Companies.

Vishwamber Cements ltd

Pursuant to a share purchase agreement on 12^th May, 2023 with the Promoter group of Vishwamber Cements Ltd (VCL), your company has acquired 100% stake in VCL at a total consideration of Rs.16.24 Crores. With the acquisition of VCL with a mining lease of 322.06 acres of limestone mines, it becomes a wholly owned subsidiary of your company. It is intended that VCL shall merge with your company which will result in the mines becoming its captive mines.

JV Partnership with NCL Buildtek Ltd

As already reported last year, your company in consortium with NCL Buildtek Ltd has bagged an order worth Rs. 1863 Crores for supply of Pre-painted (GI) Steel Window Frame with Glazed Shutters and GI Powder Coated Door Frames to the Andhra Pradesh State Housing Corporation Ltd (APSHC). During the year under review, the receipt of actual orders from APSHC were slow and the JV Partnership Venture had effected supplies of Rs.3440.15 Lakhs worth of material under the above scheme.

The Statement containing salient features of the financials of Subsidiaries / Associate Companies / Joint Ventures Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014 in form AOC-1 is enclosed as

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANYFinancial

During the year under review, Bank of Baroda has sanctioned additional working capital credit facilities amounting to Rs.30.00 Crores.

Operations and new projects Cement Division

During the year under review, the Line-1 modernization project and expansion of Line III phase II works at Mattapalli (V) in Suryapet district in Telangana State were completed and commenced its operations w.e.f May ,2022 and December, 2022 respectively.

Dividend

Your directors are pleased to propose a total dividend of 30% for the financial year 2022-23 including the interim dividend of 15% already paid to the shareholders.

DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134 (3) (c) of the Companies Act, 2013, and on the basis of the information furnished to them by the concerned accounting professionals, your Directors confirm that:

I. All applicable accounting standards have been followed in the preparation of annual accounts and that there are no material departures.

II. The Directors 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 31^st March, 2023 and of the profit of the Company for the year ended on that date.

III. 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.

IV. The Directors prepared the Annual Accounts on a going concern basis.

V. Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

VI. Appropriate systems were devised to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

DIRECTORS AND KEY MANAGERIAL PERSONS (KMP)Independent Directors

During the year under review, your Company had five independent directors upto 21st September 2022, and 4 Independent Directors thereafter. As stated in the last Annual Report, the tenure of Mr. V S Raju as Independent Directors ended on 21^st September 2022. The total number of Independent Directors is in conformity with the SEBI (LODR) Regulations throughout the year.

Persons from diverse fields of expertise and experience have been invited to join the Board as Independent Directors to ensure that the company gets the optimum benefit of wisdom and expertise.

Mr.Kamlesh Gandhi (Investment Banking), Dr.R.Kalidas (Technology) and Lt.General (Retd) T.A.Dcunha (Materials Management & Logistics) and Mrs.P.Sudha Reddy (woman entrepreneur) constitute the current team of Independent Directors.

Your company follows a policy of total transparency and proactive information flow to the Independent Directors, in order to avail the optimum benefit of their experience and expertise.

The Independent Directors also actively participate in the Board and Committee proceedings, and offer constructive suggestions, which are implemented by the company after deliberations in the full Board. Apart from this, the Independent Directors hold separate meetings and evaluate the performance of the Board and individual directors, Executive and Non-Executive Directors. The feedback on the evaluation of varied attributes is furnished to the company on a confidential basis.

The terms and conditions of appointment of independent directors are as per Schedule IV of the Act. They have submitted declarations that each of them meets the criteria of independence as provided and in Section 149(6) of the Act and there has been no change in their status as independent director during the year.

Executive Directors

Mr. K Ravi, who has been at the helm as Managing Director, ceased to be a Managing Director and was appointed as Executive Vice Chairman of the Board with effect from 1^st October 2022. As a part of the succession planning, Mr.K Gautam, the Joint Managing Director was elevated as Managing Director with effect from 1^st October 2022.

Mr. Utkal B Goradia was appointed as Executive Director of the Company with effect from 27^th September 2022.

As recommended by the Nomination & Remuneration Committee, the Board has approved the upward revision of the remuneration payable to Mr. NGVSG Prasad, Executive Director & CFO and Mrs. Roopa Bhoopatiraju Executive Director w.e.f. September 1,2023. Appropriate resolutions are being proposed at the ensuing Annual General Meeting for approval of the shareholders for the revised remuneration.

As at the end of the year under review, there were five Executive Directors namely Mr. K Ravi, Executive Vice Chairman, Mr.K.Gautam, Managing Director, Mr. Utkal B. Goradia & Mrs.Roopa Bhupatiraju Executive Directors and Mr.N.G.V.S.G.Prasad, ED & CFO.

Apart from what has been detailed in the foregoing paragraphs, there was no change in the key managerial personnel of the Company during the year under review, Mr. T. Arun Kumar is the Company Secretary & Compliance Officer and Nodal Officer under IEPF Rules.

Mr. P N Raju, Mr. Ashven Datla, and Mrs. Pooja Kalidindi are the Non Executive Directors in the Board as on the date of this Report, apart from the Independent Directors.

Retirement by Rotation

Mr.Ashven Datla and Mrs. Roopa Bhupatiraju retire by rotation at the ensuing Annual General Meeting, and are eligible for reappointment.

Mr. Ashven Datla in a mail addressed to the Chairman informed that he does not wish to continue as a Director upon completion of his term.

The Board at its meeting held on August 11^th 2023 desired not to fill the vacancy caused by the retirement of Mr. Ashven Datla. An appropriate Resolution not fill the said vacancy is being proposed at the ensuing Annual General Meeting.

The Board places on record the valuable contribution and services rendered by Mr.Ashven Datla during his tenure as Director of the company.

Particulars of Directors whose appointment / reappointment sought are given in Annexure A-1 to this Report as part of the Report on Corporate Governance under SEBI (LODR) Regulations, 2015.

BOARD MEETINGS

During the year under review, six Board meetings were held on 1).23^rd April,2022, 2).30^th May, 2022, 3).13^th August,2022, 4).27^th September, 2022, 5). 11^th November, 2022, 6).10^th February, 2023.The maximum time gap between any two consecutive meetings was within the period prescribed under the Companies Act, 2013.

Committees of the Board

The Board has constituted various committees as required under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The details of such Committees are given in Annexure - 'A' as a part of the report on Corporate Governance.

Plans for Orderly Succession for appointments to Board etc:

Your Directors are fully satisfied that plans are in place for orderly succession for appointments to the Board and to senior management positions.

CORPORATE GOVERNANCE

A separate report of compliance with the provisions relating to Corporate Governance as required SEBI (LODR) Regulations, 2015 is enclosed as Annexure ‘A' and forms part of this Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

Your company did not figure in the top 1000 listed entities based on market capitalization as on 31^st March,2023. Hence the requirement to furnish BRSR is not applicable to the company.

Risk Management

The company has a system of constantly identifying and monitoring the risks that the company may be exposed to. A Risk Management Committee headed by Independent Director as Chairman. The Committee also includes one Executive and one Non-Executive Director. As and when required, the Committee reviews various risks and steps taken to manage the risks. The Board is of the opinion that there are no elements of risks that may threaten the existence of the Company. Kindly refer Point No.39 of notes to financial statements on financial risks.

The company has not granted any loans, given any guarantees during the year under review which would be covered under section 186 of the Companies Act, 2013.

Related Party Transactions

All Related Party Transactions entered during the financial year 2022-23 were in ordinary course of business and at arm's length basis. Your Company did not enter into any Material Related Party Transactions during the year under review. Transactions entered into with the related parties are pursuant to the omnibus approval granted are reviewed and approved by the Audit Committee and the Board of Directors on quarterly basis. Pursuant to Section 134 (3) (h) of the companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the details of the Related Party Transactions are contained in Annexure A-2 to this Report.

Management Discussion and Analysis Report

The Management Discussion & Analysis Report is annexed as Annexure ‘B' to this Report.

Consolidated Financial Statement

The Consolidated Financial Statement has been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 and other relevant provisions of the Companies Act, 2013.

Litigations and Significant and Material Orders

During the year under review, no significant or material orders were passed by any regulatory/statutory authorities or courts / tribunals against the company impairing its going concern status and operations in future.

However, members' attention is drawn to the statement on contingent liabilities and commitments in the notes forming part of the financial statements.

Corporate Social Responsibility (CSR) Activities

The company has a CSR Committee as prescribed by the Statute with Dr.R.Kalidas, Independent Director as Chairman. The Committee also includes one Executive and one Independent Director. Your company has in place a CSR Policy which is available at www.nclind.com. Your company's CSR activities are focused on education, social welfare and healthcare. One CSR Committee meeting was held on 8^th February, 2023 and reviewed the CSR Policy and CSR activities.

Under the provisions of Section 135 of the Companies Act, 2013 an amount of Rs.297.40 Lakhs was required to be spent on CSR activities for the financial year 2022-23. After setting off the CSR expenditure incurred during the preceding financial years, a total amount of Rs.280.79 Lakhs was spent during the year under review, leaving a balance of Rs. 13.98 Lakhs is eligible for set off against the mandatory CSR obligation for the succeeding years. The details of the CSR activities during the year under review are listed in Annexure C to this Report.

Investor Education & Protection Fund

The Company has transferred an amount of Rs.23.69 Lakhs relating to Dividends on the shares transferred to the Investor Education & Protection Fund for the financial year 2021-22.

Apart from above, the Company has also transferred unclaimed Dividend amount of Rs. 15.29 Lakhs and a total of 1,26,215 corresponding equity shares of Rs. 10/- each on which dividends were unclaimed to the Investor Education & Protection Fund A/c on completion of 7 consecutive years as required by Section 124(5) of the Companies Act, 2013 and the Rules made there under,

Fixed Deposits

The details relating to Fixed Deposits are as follows:

As on 31^st March 2023, Rs.7,301.03 Lakhs of Public Deposits were outstanding. The Company has repaid all the matured deposits that have been claimed, and there have been no defaults in payment of interest or repayment of principal. The details of deposits received from the directors / relatives of directors during the year under review in terms of MCA Notification No.GSR 695 (E) dated 15^th September, 2015 are as under:

Particulars of Employees

The details of employees who have been in receipt of remuneration envisaged by Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial personnel) vide MCA Notification dated 30^th June, 2016 are annexed as Annexure D to this Report.

Auditors

M/s M. Bhaskara Rao & Co who have been appointed as statutory auditors for a period of five years at the last Annual General Meeting held in September 2022.They have confirmed that they are not disqualified from continuing as auditors of the company.

The Notes on the financial statements referred to in the Independent Auditor's Report are self explanatory. The Auditor's report does not contain any qualification, reservation, or adverse remark.

Cost Audit

M/s S.R. and Associates Cost Accountants have been reappointed to conduct the cost audit pertaining to Cement as well as RMC of the company for the year 2022-23. They have been reappointed by the Board of Directors as Cost Auditors of the Company for the Financial Year 2023-24. The remuneration of the cost auditors is required to be ratified by the members in terms of the relevant Rules. Accordingly, the matter is being placed before the Members for ratification at the ensuing Annual General Meeting.

The Cost Audit Report for the financial year ended March, 31st, 2022 was duly filed with Ministry of Corporate Affairs.

Secretarial Audit

M/s. A J Sharma & Associates, Company Secretaries, have been reappointed to conduct the Secretarial Audit of the Company. The Secretarial Audit Report pursuant to the provisions of Section 204 of the Companies Act, 2013 is attached as Annexure - E to this Report. The observations of the Report do not call for any explanation as envisaged by Section 204(3) of the said Act.

Details in respect of frauds reported by auditors under Section 143(12) other than those which are reportable to Central Government

No frauds were reported by the Auditors under Sub Section 12 of Section 143 of the Companies Act, 2013 read with the Rules made there under.

Awards / Certifications Great Place to Work, 2023

Your Company is proud to state that “Great Place to Work” Organization was granted renewed certification as a “Great Place to Work” from October, 2023 to November, 2024 for the third time in succession. This reflects the confidence reposed by employees about the work atmosphere and the recognition accorded to them as partners in progress.

Indian Cement Review

Indian Cement review Magazine conferred the award of fastest growing cement company in India (Small category) 2021 to the company

The Federation of Telangana Chamber of Commerce and Industry awarded excellence in Employee Welfare Initiatives during the year 2022-23. Also, HMA awarded CSR Award 2022-23 in the category of excellence in CSR activities undertaken by the company during the year 2022-23.

During the year under review, NCL Doors was awarded by 4M Pride of India in the category of best brand in South India.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has constituted an Internal Complaints Committee on Prevention of Sexual Harassment at workplace for women in the line with the requirements of the 'The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013 and the Rules made there under and had complied with provisions made under the said Act.

During the year under review, there were no references or complaints pursuant to the aforesaid Act.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Particulars required under Section 134 (3) (M) of the Companies act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 are furnished under Annexure ‘F” which forms part of this Report. Your Company continues to be conscious of the need for conservation of energy, and wherever feasible, effective steps for energy conservation are taken.

There were no significant investments or developments in this regard during the year under review. The technology procured for the various operating Divisions has been fully absorbed. There was no significant expenditure in Research & Development warranting a special mention in this Report.

PROCEEDING PENDING UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016

There is no proceeding pending against the company under the Insolvency and Bankruptcy Code, 2016 during the year under review.

ONE-TIME SETTLEMENT WITH THE BANKS OR FINANCIAL INSTITUTIONS

There was no instance of onetime settlement with any Bank or Financial Institution during the year under review. Extract of Annual Return

The Annual Return as required under Section 92 and Section 134 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the Company's website www.nclind.com.

Acknowledgements

Your directors wish to place on record their appreciation of the support and co-operation extended by Axis Bank, HDFC Bank, SBI, Kotak Mahindra Bank, Bank of Baroda and Central and State Government Departments, Dealers, Stockists, Consumers and Depositors.

Your directors also wish to place on record their appreciation of the enthusiastic support received from the shareholders.

Your directors have pleasure in acknowledging the excellent co-operation received from the team of dedicated executives and employees who have contributed handsomely to the operations of the company.