Directors Report of FSN E-Commerce Ventures Ltd.

Mar 31, 2025

Your Board of Directors ("Board") are pleased to present the 13 ^th (Thirteenth) Annual Report of FSN E-Commerce Ventures Limited
("your Companyâ or "the Companyâ or "Nykaaâ) together with the Audited Financial Statements of the Company, for the financial
year ended March 31, 2025 ("the year under reviewâ or "the yearâ or "FY25â).

Financial Performance â An Overview

(C in crores)

Particulars	2024-25	2023-24*	2024-25	2023-24*
Revenue from Operations	419.95	312.52	7,949.82	6,385.62
Other Income	157.33	184.64	27.26	29.94
Total Income	577.28	497.16	7,977.08	6,415.56
Total Expenditure	479.99	403.24	7,849.63	6,346.54
Profit before Tax	97.29	93.92	127.45	69.02
Current Tax	16.80	9.01	41.50	106.73
Deferred Tax (Credit)/Expenses	(16.87)	(36.11)	12.25	(81.42)
Profit after Tax	97.36	121.02	73.70	43.71
Share in loss of associate	-	-	(1.63)	(3.97)
Profit for the period	97.36	121.02	72.07	39.74
Other Comprehensive Income/Loss (OCI)	(0.95)	0.20	(4.31)	0.44
Total Comprehensive Income	96.41	121.22	67.76	40.18
Balance in the Profit/ (Loss) Account in the Balance Sheet	345.13	246.91	48.46	(6.15)

* Restated on account of acquisition of business through slump sale, Scheme of Amalgamation and Scheme of Arrangement.

REVIEW OF OPERATIONS

During the year under review, the Standalone income of your
Company increased to C577.28 crores as compared to C497.16
crores in the previous year, registering a growth of 16%. The
Standalone profit after tax for the year was C97.36 crores as
compared to C121.02 crores in the previous year registering a
decrease of 20%.

During the year under review, the Consolidated income of the
Group increased to ?7,977.08 crores compared to ?6,415.56
crores in the previous year, registering growth of 24%. The
Consolidated profit for the period for the Group was C72.07 crores
as compared to C39.74 crores in the previous year registering
an increase of 81%.

The operating and financial performance of your Company has
been covered in the Management Discussion and Analysis Report
which forms part of the Annual Report.

DETAILS OF MATERIAL CHANGES AND
COMMITMENTS FROM THE END OF THE
FINANCIAL YEAR

There were no material changes and commitments affecting the
financial position of your Company, which have occurred between
end of the FY25 and the date of this report.

RESERVES

Your Board has decided to retain the entire amount of profit
for FY25.

DIVIDEND

Your Board has not recommended any dividend on the equity
shares of the Company for financial year ended March 31, 2025,
as the Company is in growing stage and would require funds to
support its growth objectives.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Securities and Exchange
Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("the Listing Regulationsâ), your Company has
formulated a Dividend Distribution Policy, with an objective to
provide the dividend distribution framework to the stakeholders
of the Company. The policy sets out various internal and external
factors, which shall be considered by the Board in determining
the dividend pay-out. The policy is available on the website of
the Company at Dividend Distribution Policy.

SHARE CAPITAL

The details of changes in paid-up equity share capital during the
year under review, are as under:

	Paid-up Equity Share Capital	D in crores
A	At the beginning of the year, i.e., as on April 01, 2024	285.599
B	Allotments made pursuant to exercise of vested stock options under the various employee stock option schemes of the Company	0.326
C	At the end of the year, i.e., as on March 31, 2025 (C=A B)	285.925

STANDALONE AND CONSOLIDATED FINANCIAL
STATEMENTS

The Audited Standalone and Consolidated Financial Statements
of the Company, for the financial year ended March 31, 2 025, are
prepared, in accordance with the requirements of the Companies
(Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under
Section 133 of the Companies Act, 2013 ("Actâ) read with relevant
Rules and other accounting principles. The Consolidated Financial
Statement has been prepared based on the financial statements
received from Subsidiaries and an Associate company, as approved
by their respective Board of Directors.

STRATEGIC INITIATIVES DURING THE YEAR
UNDER REVIEW AND TILL THE DATE OF THIS
REPORT

Your Company strives to create and enhance the value for its
stakeholders through synergising and optimising its business
operations and thus, in line with your Company''s value of
''Be Better Everyday'', the following strategic initiatives were
taken during the year under review:

A. DEMERGER OF E-B2B BUSINESS FROM FSN
DISTRIBUTION LIMITED TO NYKAA E-RETAIL
LIMITED

Your Board, at its meeting held on February 06, 2024,
approved Scheme of Arrangement between FSN
Distribution Limited and Nykaa E-Retail Limited, wholly
owned subsidiaries of the Company, and their respective
shareholders and creditors.

Nykaa E-Retail Limited primarily has an inventory led
business model of selling beauty and personal care products
of its own brands as well as third party brands through
online channels i.e., its own online platforms and websites.
FSN Distribution Limited has a B2B inventory led business
model of selling beauty and personal care products through
its distribution networks using online as well as offline sales
channels. The Scheme comprised of demerger of online B2B
beauty business from FSN Distribution Limited to Nykaa E-
Retail Limited. Post demerger, residual business of offline
B2B business i.e. general / modern trade business would
continue in FSN Distribution Limited.

This demerger would facilitate synergy in operations such as
effective utilisation of warehouse and office space, synergy

in technology cost and overheads. It would further result in
consolidation of online beauty business under one entity,
leading to reduction in compliances and intercompany
transactions and improved customer experience.

The Hon''ble National Company Law Tribunal, Mumbai
approved the scheme of arrangement vide its order
dated May 9, 2025. The Appointed date for the Scheme
of Amalgamation is April 01, 2024, and the Scheme is
operationalised with effect from May 29, 2025.

Pursuant to the Scheme, 10,000 equity shares of ?10 each
(fully paid up) of Nykaa E-Retail Limited will be issued and
allotted to FSN E-Commerce Ventures Limited.

B. AMALGAMATION OF ILUMINAR MEDIA
LIMITED WITH NYKAA FASHION LIMITED

Your Board had at its meeting held on May 22, 2024,
approved Scheme of Amalgamation of Iluminar Media Limited
with Nykaa Fashion Limited.

Iluminar Media Limited (''Transferor Company''), inter alia,
had been engaged in the business of digital media marketing
and advertising services on online portal. The Transferor
Company is a wholly owned subsidiary of Nykaa Fashion
Limited. Nykaa Fashion Limited is engaged in the business
of selling and distribution of fashion garments and fashion
accessories through online channels i.e., its online platforms
or websites, other online applications and retail outlets,
general trade and modern trade. Nykaa Fashion Limited is
a wholly owned subsidiary of the Company.

The Scheme would result in streamlining of the corporate
structure and consolidation of assets and liabilities, drive
synergies in technology, infrastructure and collaboration
with all the stakeholders of the companies, facilitate more
efficient utilisation of capital for enhanced development and
growth of the consolidated business in one entity, easier
implementation of corporate actions through simplified
compliance structure, cost savings through legal entity
rationalisation and consolidation of support functions &
business processes, elimination of duplicate expenses, and
would also improve management oversight.

The Hon''ble National Company Law Tribunal, Mumbai
approved the Scheme vide its order dated May 27, 2025.
The Appointed date for the Scheme of Amalgamation is April
01, 2024, and the Scheme is operationalised with effect
from May 29, 2025.

As the Scheme of Amalgamation is between Nykaa Fashion
Limited with its wholly owned subsidiary company - Iluminar
Media Limited, there will not be any issuance of shares
pursuant to the Scheme. Post the Scheme becoming
effective (i.e., from May 29, 2025), Iluminar Media Limited
stands dissolved and ceases to exist as a separate legal entity.

C. INCREASED STAKE IN "DOT & KEY WELLNESS
LIMITED"

Your Board, at its meeting held on August 13, 2024, approved
further acquisition of 39% stake in "Dot & Key Wellness
Limitedâ (formerly "Dot & Key Wellness Private limited)

as per the terms of the Shareholder Agreement dated
September 19, 2021 and January 09, 2024, respectively.
All the necessary conditions as per the said Documents
and the Share Purchase Agreement were completed by the
Company during the financial year under review.

The Company acquired additional 5,030 equity shares on
March 28, 2025. Accordingly, the Company currently holds
-90% of equity shares in "Dot & Key Wellness Limitedâ.

Dot & Key is engaged in the business of manufacturing,
marketing, branding and sale of skincare and personal care
products, including serums, toners, cleansers, face masks
and face creams. Dot & Key has also launched products
in the nutraceuticals category. The products are listed on
Company''s and other online retailers'' platforms as well as
available in physical retail stores. Following this investment,
Dot & Key became one of Company''s owned brands and
this investment would allow the Company to expand its
skincare, personal care and nutraceuticals offerings.

D. INCREASED STAKE IN "EARTH RHYTHM
PRIVATE LIMITED"

Your Board at its meeting held on August 13, 2024 approved
entering into Share Subscription & Shareholders'' Agreement
(''SSHA'') and Share Purchase Agreement (''SPA'') with Earth
Rhythm Private Limited (''Earth Rhythm'') to acquire its
issued and paid-up share capital by way of subscription
and/or purchase of Compulsory Convertible Cumulative
Preference Shares and/ or Optionally Cumulative Redeemable
Preference Shares and Share Warrants, through primary as
well as secondary issuances. Post this subscription, your
Company holds -74.63% of the issued and paid-up share
capital of Earth Rhythm on a converted basis, in accordance
with the terms and conditions of the above-mentioned
SSHA and SPA.

Earth Rhythm is a personal care brand which manufactures
and sells sustainable/non-toxic beauty products on their
website and other e-commerce websites. This additional
investment would not only strengthen your Company''s
product portfolio into sustainable beauty segment but also
solidify its positioning in the growing market for products
that are committed to efficacy as well as the planet.

E. ACQUISITION OF WESTERN WEAR AND
ACCESSORIES BUSINESS BY WAY OF SLUMP
SALE FROM NYKAA FASHION LIMITED

Your Board, at its meeting held on May 22, 2024, had approved
the proposal to acquire the Western Wear and Accessories
business of Nykaa Fashion Limited ("Transferor Companyâ),
which is a wholly owned subsidiary of the Company, as a
going concern on a slump sale basis, in accordance with
the business transfer agreement ("BTAâ) entered between
the Company and the Transferor Company. The total cost
of acquisition was approximately C133.7 crores.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE
COMPANIES

As on March 31, 2025, the Company has Eleven direct subsidiaries
and Ten step-down subsidiaries. The status of Dot & Key Wellness
Limited was converted from private limited company to public
limited company during the year under review.

During the year under review, Nykaa Essentials Private Limited
was incorporated as a wholly owned subsidiary of the Company.

The following step-down subsidiaries were incorporated during
FY25 by Nessa International Holdings Limited, a step-down
subsidiary of the Company:

(i) Nysaa Distribution FZE., JAFZA, UAE

(ii) Nysaa Cosmetics Trading, Qatar

(iii) Nysaa Trading LLC, Saudi Arabia

(iv) Nysaa Cosmetics SPC, Oman

(v) Nysaa International for Wholesale and Retail Trade Co.
SPC, Kuwait

Pursuant to the provisions of Section 129(3) of the Act read
with the Companies (Accounts) Rules, 2014 and in accordance
with applicable accounting standards, a statement containing
the salient features of financial statements of your Company''s
subsidiaries in Form No. AOC-1 is annexed as Annexure â I to
this Report.

In accordance with the provisions of Section 136 of the Act
and the amendments thereto, and the Listing Regulations,
the Audited Financial Statements, including the Consolidated
Financial Statements and related information of the Company
and financial statements of your Company''s subsidiaries have
been placed on the website of your Company at https://www.
nvkaa.com/investor-relations/lp

Your Company has formulated a Policy for determining Material
Subsidiaries pursuant to the Listing Regulations. The said policy is
available on the website of the Company at Policy for determining
Material Subsidiary

During the year under review, Nykaa E-Retail Limited and FSN
Brands Marketing Private Limited were material subsidiaries of the
Company as per Regulation 16 and Regulation 24 of the Listing
Regulations, which required appointment of one of the Company''s
independent directors on the board of the material subsidiaries.

MANAGEMENT DISCUSSION AND ANALYSIS
REPORT

Management Discussion and Analysis Report for the year under
review, as stipulated under the Listing Regulations, is presented
in a separate section, forming a part of the Annual Report.

INTEGRATED ANNUAL REPORT

In compliance with the SEBI circular dated February 06, 2017, your
Company has voluntarily published the Integrated Annual Report,
which includes both financial and non-financial information and is

based on the International Integrated Reporting Framework. This
report covers aspects such as organisation''s strategy, governance
framework, performance and prospects of value creation based
on the seven forms of capitals viz. financial capital, manufactured
capital, intellectual capital, human capital, social & relationship
capital, digital capital and natural capital.

An Integrated Report intends to give a holistic picture of an
organisation''s performance and prospects to the providers of
financial capital and other stakeholders. It is thus widely regarded
as the future of corporate reporting. Your Board acknowledges its
responsibility for the integrity of the report and the information
contained therein.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT (''BRSR'')

The BRSR, including BRSR Core consisting of Key Performance
Indicators and the reasonable assurance statement by TUV India
Private Limited, for the year under review, as stipulated under
Regulation 34(2)(f) of the Listing Regulations, describing the
initiatives taken by your Company from social and governance
perspective, forms an integral part of the Annual Report as
''Annexure â VII''.

CORPORATE GOVERNANCE

Your Company embeds sound Corporate Governance practices
and constantly strives to adopt emerging best practices. It has
always been the Company''s endeavour to excel through better
Corporate Governance alongwith fair and transparent practices.
A Report on Corporate Governance forms part of this Report as
Annexure â II''.

M/s. S. N. Ananthasubramanian & Co., Company Secretaries,
the Secretarial Auditors of the Company vide their certificate
dated May 29, 2025, have confirmed that the Company is and
has been compliant with the conditions stipulated in Chapter
IV of the Listing Regulations. The said certificate is annexed as
''Annexure â III'' to this Report.

ANNUAL RETURN

The Annual Return of the Company as on March 31, 2025 in
Form MGT - 7 in accordance with Section 92(3) and Section
134(3)(a) of the Act, as amended from time to time and the
Companies (Management and Administration) Rules, 2014, has
been uploaded on the website of the Company at https://www.
nykaa.com/annual-report/lp.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Act, with
respect to Directors'' Responsibility Statement, the Directors of
the Company confirm that:

a) In the preparation of the annual accounts for the year ended

March 31, 2025, the applicable accounting standards had
been followed and there have been no material departures
from the same;

b) They had selected such 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, 2025
and of the profits of the Company for the year ended on
that date;

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

d) They had prepared the annual accounts on a going
concern basis;

e) They had laid down internal financial controls to be followed
by the Company and such internal financial controls were
adequate and operating effectively; and

f) They had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems
were adequate and operating effectively.

AUDITORS AND THEIR REPORT

(i) Statutory Auditors

M/s. S. R. Batliboi & Associates LLP, Chartered Accountants
(Firm Registration No. 101049W/E300004), were
re-appointed as Statutory Auditors of the Company at
the 9 ^th AGM of the Company held on September 29, 2021,
to hold office till the conclusion of the 14^th AGM to be held
for FY26.

In terms of Section 139 and 141 of the Act and relevant
Rules prescribed thereunder, M/s. S. R. Batliboi & Associates
LLP, Chartered Accountants have confirmed that they
are not disqualified from continuing as Auditors of the
Company. The Auditors have also confirmed that they have
subjected themselves to the peer review process of Institute
of Chartered Accountants of India (ICAI) and hold a valid
certificate issued by the Peer Review Board of the ICAI.

The Auditors have issued an unmodified opinion on the
Financial Statements for the FY25 and the Auditor''s Report
forms part of this Annual Report. The Auditor''s Report does
not contain any qualification, reservation or adverse remark.

(ii) Secretarial Auditors

In compliance with Regulation 24A of the Listing Regulations
and Section 204 of the Act read with Rule 9 of Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Board at its meeting held on May 30,
2025, based on recommendation of the Audit Committee,
approved the appointment of M/s. S. N. Ananthasubramanian
& Co., Practising Company Secretaries, a peer reviewed
firm (Firm Registration No. P1991MH040400) as
Secretarial Auditors of the Company for a term of five
consecutive financial years commencing from FY26 till

FY30, subject to approval of the Members at the ensuing
AGM. Resolution seeking their appointment along-with other
details as required under Regulation 36(5) of the Listing
Regulations forms part of the Notice of Thirteenth Annual
General Meeting.

Further, in compliance of Regulation 24A of the Listing
Regulations, Company''s unlisted material subsidiaries also
undergo Secretarial Audit and the Secretarial Audit Reports
of the Company and its unlisted material subsidiaries thereto,
in the prescribed Form No. MR-3, have been attached as
Annexure â IV, IV(A) and (B) forming part of this Report.

The Secretarial Auditors Reports of the Company and of
the Material Subsidiaries do not contain any qualification,
reservation, adverse remark or disclaimer.

REGISTRAR AND TRANSFER AGENT

During the year under review, Link Intime India Private Limited,
Registrar and Transfer Agent ("RTAâ) of the Company has changed
its name to ''MUFG Intime India Private Limited'' ("MIIPL") with effect
from December 31, 2024. MIIPL is now the RTA of the Company.

DISCLOSURES IN TERMS OF THE PROVISIONS OF
THE ACT & THE LISTING REGULATIONS

A. Board of Directors ("Board")

(i) Number of meetings

The Board met 5 (Five) times during the year under review.
The details of such meetings are disclosed in the Corporate
Governance Report forming part of this Annual Report.

The maximum interval between any two meetings did not
exceed 120 days.

(ii) Directors retiring by rotation

In accordance with the provisions of the Act and the
Articles of Association of the Company, Ms. Adwaita Nayar,
(DIN:07931382), Executive Director and Mr. Milan Khakhar,
(DIN:00394065), Non - Executive (Non-Independent)
Director, are due to retire by rotation at the ensuing
Annual General Meeting and being eligible, have offered
themselves for re-appointment. The Board of Directors, on
the recommendation of the Nomination and Remuneration
Committee (''NRC''), has approved and recommended their
re-appointment.

Resolution seeking their re-appointment along-with their
profile and other details as required under Regulation 36(3)
of the Listing Regulations forms part of the Notice of
Thirteenth Annual General Meeting.

(iii) Board Evaluation

In sync with Nykaa value of "Be Better Everyday", the
Nomination and Remuneration Committee / Board of
Directors reviewed the Board evaluation framework and
process for the FY25 to further strengthen the criteria,
parameters and sharpness of rating/feedback for Board,
its Committees & its individual Directors.

Pursuant to applicable provisions of the Act and the Listing
Regulations, the Board, in consultation with its Nomination
and Remuneration Committee, has formulated a framework
containing, inter alia, the criteria for performance evaluation
of the entire Board of the Company, its Committees and its
individual Directors, including Independent Directors. The
framework is monitored, reviewed and updated by the Board,
in consultation with the Nomination and Remuneration
Committee, in accordance with the compliance requirements.

The annual performance evaluation of the Board, its
Committees and each Director has been carried out for
the FY25 in accordance with the framework. The details
of evaluation process of the Board, its Committees and its
individual Directors, including Independent Directors have
been provided under the Corporate Governance Report
which forms part of this Report.

The Policy on Board of Directors'' Evaluation Framework
can be accessed at: Policy on Board of Director''s
Evaluation Framework.

(iv) Declaration of Independence

The Company has received necessary declaration from each
Independent Director of the Company stating that:

(i) they meet the criteria of independence as provided
in Section 149(6) of the Act and Regulation 16(1)(b)
of the Listing Regulations; and

(ii) as required vide Rule 6 (1) & (2) of the Companies
(Appointment and Qualifications of Directors) Rules,
2014 they have registered their names in the
Independent Directors'' Databank maintained by the
Indian Institute of Corporate Affairs.

Based on the declarations received from the Directors,
the Board confirms, there has been no change in the
circumstances affecting their status as Independent
Directors of the Company. In the opinion of the Board,
the Independent Directors are competent, experienced,
proficient and possess necessary expertise and integrity to
discharge their duties and functions as Independent Directors.

(v) Familiarisation programme for Independent
Directors

Disclosure pertaining to familiarisation programme
for Independent Directors is provided in the Corporate
Governance Report forming part of this Annual Report.

B. Committees of the Board

The Board has constituted five committees which are
mandated by the Act and the Listing Regulations, viz.

(i) Audit Committee,

(ii) Nomination and Remuneration Committee,

(iii) Stakeholders'' Relationship Committee,

(iv) Risk Management Committee

(v) Corporate Social Responsibility & Environmental, Social,
and Governance Committee.

In addition to the said committees, the Board has also
constituted Fundraise and Investment Committee.

During the year, all recommendations of the Committees
were approved by the Board. Details of all the Committees,
along with their charters, composition and meetings held
during the year, are provided in the Corporate Governance
Report forming part of this Annual Report.

C. Directors and Key Managerial Personnel

During the year, following were the changes in Directors:

1. Mr. Pradeep Parameswaran (DIN: 07206780) was
re-appointed as an Independent Director of the
Company, for a second term of 3 (Three) years
commencing from July 15, 2024, vide special resolution
passed through Postal Ballot.

2. Mr. Seshashayee Sridhara (DIN: 09247644) was
re-appointed as an Independent Director of the
Company, for a second term of 3 (Three) years
commencing from July 26, 2024, vide special resolution
passed through Postal Ballot.

3. Mr. Santosh Desai (DIN: 01237902) was appointed
as an Independent Director of the Company, for the
first term of 3 (Three) years commencing from July
15, 2024, by vide special resolution passed through
Postal Ballot.

4. Ms. Alpana Parida (DIN: 06796621) ceased to be an
Independent Director of the Company w.e.f. July 14,
2024, due to completion of her term as an Independent
Director of the Company.

In accordance with the provisions of Sections 2(51) and
203 of the Act read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 the
following are the Key Managerial Personnel of the Company:

(a) Ms. Falguni Nayar - Executive Chairperson, Managing
Director and Chief Executive Officer.

(b) Mr. P. Ganesh - Chief Financial Officer.

There were no changes in the Key Managerial Personnel of
the Company during the year under review.

None of the Company''s Directors are disqualified from being
appointed as a director as specified in Section 164 of the
Act. All Directors have further confirmed that they are not
debarred from holding the office of a director under any
order from SEBI or any other authority.

During the year under review, the Non-Executive Directors
(including Independent Directors) of the Company
had no pecuniary relationship or transactions with the
Company, other than receipt of sitting fees, commission,
reimbursement of expenses incurred by them for the purpose
of attending meetings of the Board and its Committees
or other Company events and any other transactions as
approved by the Audit Committee or the Board which have

been disclosed under the Notes to Accounts. For more
details about the Directors, please refer to the Corporate
Governance Report.

D. Remuneration of Directors and Employees

Disclosure comprising particulars with respect to the
remuneration of Directors and employees and other details,
as required in terms of the provisions of Section 197(12)
of the Act and Rule 5(1) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, is
annexed as "Annexure - V" to this Report.

In terms of the provisions of Section 197(12) of the Act read
with Rules 5(2) and 5(3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014,
statement showing the names of the top ten employees in
terms of remuneration drawn and names and other particulars
of the employees drawing remuneration in excess of the
limits set out in the said rules forms part of this Report.

Pursuant to the provisions of the second proviso to
Section 136(1) of the Act, the Annual Report, excluding
the aforesaid information, is being sent to the Members
of the Company. Any Member interested in obtaining
such information may write to the Company Secretary at
[email protected].

Your Company has adopted ''Remuneration Policy for
Directors, Key Managerial Personnel and other Employees''
which sets out criteria for the remuneration for Directors
and Key Managerial Personal and the same can be accessed
at: Remuneration Policy for Directors, Key Managerial
Personnel and Other Employees

E. Vigil Mechanism/Whistle-Blower

Your Company is committed to highest standards of business
ethics and integrity and ensuring compliance to applicable
laws. Your Company continues to believe in conducting its
affairs in a fair and transparent manner by adopting highest
standards of honesty, integrity, professionalism and ethical
behaviour. Your Company has established a Vigil Mechanism/
Whistle-blower Policy in accordance with the provisions of
the Companies Act, 2013 and the Listing Regulations with
a view to provide a platform and mechanism for employees,
Directors and other stakeholders of the Company to report
actual or suspected unethical behaviour, fraud or violation
of the Company''s Code of Conduct, ethics, principles and
matters specified in the policy without any fear of retaliation,
and also provide for direct access to the Chairperson of the
Audit Committee as the case may be, in exceptional cases.
Your Company is committed to developing a culture where
it is safe for all persons covered under the Code and enables
access to raise concerns without any fear of retaliation
regarding potential violation.

appointed by the Company to receive and attend to the
Protected Disclosures through toll-free number / e-mail /
web portal), established in terms of the Policy.

The Company affirms compliance with the Whistle-Blower
Policy/Vigil Mechanism. All Employees and Directors have
access to the Chairperson of the Audit Committee in
appropriate and exceptional circumstances and it is affirmed
that no person has been denied access to the Chairperson
of the Audit Committee.

The policy is available on the Company''s website and can
be accessed at: Whistle-Blower Policy/ Vigil Mechanism.

F. Corporate Social Responsibility (''CSR'')

A brief outline of the CSR Philosophy, salient features of the
CSR Policy of the Company, the CSR initiatives undertaken
during the FY25 together with progress thereon and the
report on CSR activities in the prescribed format, as required
under Section 134(3)(o) read with Section 135 of the Act
and the Companies (Corporate Social Responsibility Policy)
Rules, 2014, are set out in ''Annexure - VI'' to this Report
and the CSR Policy can be accessed on the website of the
Company at CSR Policy.

G. Employee Stock Option Scheme and Share
Based Employee Benefits

- 2012 ("ESOS 2012â), FSN Employees Stock Scheme -
2017 ("ESOS 2017â), FSN E- Commerce Ventures Limited

- Employee Stock Option Plan 2022â ("ESOP 2022â) and
FSN E-Commerce Ventures Limited - Employee Stock Unit
Plan 2022 ("RSU Schemeâ) for grant of stock options to
eligible employees.

The Nomination and Remuneration Committee of the
Company, inter alia, administers and monitors the ESOS
& RSU Schemes, in accordance with the Securities and
Exchange Board of India (Share Based Employee Benefits
and Sweat Equity) Regulations, 2021 ("SBEB Regulationsâ).
During the year under review, there is no material change in
the ESOS & RSU Schemes, and they have been in compliance
with the provisions of SBEB Regulations and other applicable
provisions of law.

The applicable disclosures as stipulated under Regulation
14 of SBEB Regulations with regard to the ESOP & RSU
Schemes of the Company are available on the website of
the Company at https://www.nvkaa.com/annual-report/lp

A certificate from M/s. S. N. Ananthasubramanian & Co.,
Company Secretaries, the Secretarial Auditor of the
Company, confirming that the aforesaid ESOP & RSU

Schemes have been implemented in accordance with the
SBEB Regulations, will be open for inspection at the ensuing
Annual General Meeting.

H. Investor Education and Protection Fund
(''IEPF'')

The Company, till date, is not required to transfer any amount
to the IEPF Account in terms of the provisions of the Act
and the Rules thereunder.

I. Related Party Transactions

All transactions with related parties were reviewed and
approved by the Audit Committee and were in accordance
with the Policy on Materiality of Related Party Transactions
and on dealing with Related Party Transactions and the
Related Party Framework, formulated and adopted by the
Company. Prior omnibus approval is obtained for transactions
which are of a repetitive nature and are in the ordinary course
of business and at arm''s length pricing.

All contracts/arrangements/transactions entered by the
Company during the year under review with related parties
were in the ordinary course of business and on arm''s length
pricing. During the year under review, the Company had
not entered into any contract/ arrangement/ transaction
with related parties which could be considered material in
accordance with the Policy of the Company, the Act and the
Listing Regulations or which are required to be reported in
Form AOC-2 in terms of Section 134(3) (h) read with Section
188 of the Act and Rule 8(2) of the Companies (Accounts)
Rules, 2014. Accordingly, there are no transactions that
are required to be disclosed in Form AOC-2.

The Company''s Policy on Materiality of Related Party
Transactions and on dealing with Related Party Transactions
is available on the website of the Company at Related Party
Transaction Policy.

The details of the related party transactions as per Indian
Accounting Standards (IND AS) - 24 are set out in the
Standalone Financial Statement of the Company. Your
Company in terms of Regulation 23 of the Listing Regulations
submits, within the stipulated time, disclosures of related
party transactions, in the specified format to the stock
exchanges. The said disclosures can be accessed on the
website of the Company at RPT Disclosure.

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

Considering the nature of business of your Company,
the particulars with respect to conservation of energy
and technology absorption required pursuant to Section
134(3)(m) of the Act read with Rule 8(3) of the Companies
(Accounts) Rules, 2014, are not applicable to the Company.

The foreign exchange earnings and outgo are as below:

Particulars	2024-25	2023-24
Earnings in Foreign	Nil	Nil
Exchange
Expenditure in Foreign	1357.6 Mn	180.50 Mn
Exchange

K. Risk Management

Your Company has a risk management framework which
proactively identifies, assess and mitigates risks, supporting
decision making across various levels of the Company.

To effectively mitigate risks that impact our strategic
business objectives, we have employed an EnterpriseÂ¬
wide Risk Management framework (''ERM'') by adapting the
frameworks of COSO Enterprise Risk Management (ERM)
framework 2017 and also ISO 31000 Risk Management
framework, to support proactive identification, assessment,
prioritisation, management and monitoring of risks that could
have a material impact on the achievement of Company''s
business objectives, while also formulating relevant risk
mitigation strategies which helps protecting our assets,
and support informed decision making which will reduce
the impact of any adverse events.

The Board of Directors of the Company has also formed a Risk
Management Committee to frame, implement, and monitor
the risk management plan for the Company. The Committee
is responsible for reviewing the risk management plan and
ensuring its effectiveness. The Committee considers the
risks that impact the mid-term to the long-term objectives
of the business, including those which are reputational
in nature.

The Company endeavours to continually strengthen its Risk
Management systems and processes in line with a rapidly
changing business environment. There were no risks which
in the opinion of the Board threaten the existence of the
Company. Details of various risks faced by your Company are
provided in the Management Discussion & Analysis Report.

Your Company has framed and implemented a Risk
Management Policy in terms of the provisions of Regulation 21
of the Listing Regulations, for assessment and minimisation
of risk, including identification of elements of risk, if any,
which may threaten the existence of the Company. The
policy can be accessed at Risk Management Policy.

L. Internal Financial Control

According to Section 134(5)(e) of the Act the term Internal
Financial Control (IFC) means the policies and procedures
adopted by the Company for ensuring the orderly and
efficient conduct of its business, including adherence to
company''s policies, safeguarding of its assets, prevention and
detection of frauds and errors, accuracy and completeness
of the accounting records, and timely preparation of reliable
financial information. The Act also mandates the need for an
effective internal financial control system in the Company
which should be adequate and shall operate effectively. Rule
8(5)(viii) of Companies (Accounts) Rules, 2014 requires the
information regarding adequacy of internal financial control

with reference to the financial statements to be disclosed
in the Board''s report.

The Company has adequate internal financial control system
over financial reporting ensuring that all transactions are
authorised, recorded, and reported correctly in a timely
manner inorder to provide reliable financial information
and to comply with applicable accounting standards which
commensurate with the size and volume of business of
the Company.

The key internal financial controls have been
documented, automated wherever possible and embedded
in the respective business processes. Assurance to the
Board on the effectiveness of internal financial controls is
obtained through 3 Lines of Defence which include:

(a) Management reviews and self-assessment.

(b) Continuous control monitoring by functional
experts; and

The Company believes that these systems provide reasonable
assurance that the Company''s internal financial controls
are adequate and are operating effectively as intended.
During the year under review, such controls were tested
by the Statutory Auditors of the Company and no material
weaknesses or significant deficiencies in the design or
operations were observed and reported by the Statutory
Auditors. Details of the internal controls system are provided
in the Management Discussion & Analysis Report.

M. Policy on Directors'' Appointment and
Remuneration

In terms of Section 178 of the Act and Regulation 19 of
the Listing Regulations, the Board of your Company, on
recommendation of the NRC, had adopted a "Remuneration
Policy for Directors, Key Managerial Personal and other
employeesâ (''Remuneration Policy'') and "Policy on
Board Diversityâ.

The Company''s Remuneration Policy is directed towards
designing remuneration so as to attract, retain, and reward
talent who will contribute to long-term success of the
Company and build value for its shareholders. Objective
of Board Diversity Policy is to ensure that the Board is
fully diversified and comprises of an ideal combination
of Executive and Non-Executive Directors, including
Independent Directors, with diverse backgrounds.

The salient features of the policies are outlined in the
Corporate Governance Report and the policies are made
available on the Company''s website, which can be accessed
at https://www.nykaa.com/policies.

N. Particulars of Loans, Guarantees and
Investments

Particulars of loans given, investments made, guarantees
given and securities provided under Section 186 of
Companies Act, 2013 along with the purpose for which
the loan or guarantee or security provided is proposed to be

utilised by the recipient has been provided in the Standalone
Financial Statement.

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

In compliance with the requirement of the Sexual Harassment
of Women at Workplace (Prevention, Prohibition & Redressal)
Act, 2013 and rules made thereunder, your Company has
adopted a Prevention of Sexual Harassment Policy for the
prevention of sexual harassment and constituted Internal
Complaints Committee (ICC) to deal with complaints relating
to sexual harassment at workplace. For details of complaints
received during the year, kindly refer to relevant disclosures
in the Corporate Governance Report which forms part of
the Annual Report.

P. Environment & Safety

Your Company is conscious of the importance of
environmentally clean and safe operations and has accordingly
framed and adopted Health, Safety and Environment
(HSE) Policy which can be accessed at Health, Safety and
Environment Policy. The Company''s policy requires conduct
of operations in such a manner that it ensures safety of all
concerned, compliances of environmental regulations and
preservation of natural resources.

Your Company is committed to the highest standards
of health, safety and environment practices within the
organisation and the extended areas within our influence,
with an aim to provide safe and healthy working environment
to our employees, customers, business partners, suppliers
and visitors.

During the year under review, the Company continued its
waste management efforts through various environment
friendly measures i.e., use of eco-friendly packaging material,
recycling of plastic waste and redesigning packaging
to reduce plastic waste. Scrap disposal was in line with
industry benchmarks.

GENERAL

Your Directors state that no disclosure or reporting is required

in respect of the following items as there were no transactions/

events on these items during the year under review:

â¢ There was no change in the nature of business of your
Company as stipulated under Rule 8(5)(ii) of Companies
(Accounts) Rules, 2014.

â¢ Your Company has not accepted any deposits from the public
falling under Section 73 of the Act read with the Companies
(Acceptance of Deposits) Rules, 2014.

â¢ No significant or material orders were passed by the Regulators
or Courts or Tribunals, which impact the going concern status
and Company''s operations in future.

â¢ No issuance of shares (including sweat equity shares) to
employees of the Company under any scheme save and except
Employees'' Stock Options Schemes referred to in this Report.

â¢ No fraud has been reported by the Auditors to the Audit
Committee or the Board under Section 143(12) of the Act.

â¢ There is no application made or proceeding pending under the
Insolvency and Bankruptcy Code, 2016 during FY25.

â¢ The Company has not made any one-time settlement for the
loans taken from the Banks or Financial Institutions.

â¢ Your Company has not issued equity shares with differential
rights as to dividend, voting or otherwise; and

â¢ Your Company has not raised funds through preferential
allotment or qualified institutions placement as per Regulation
32(7A) of the Listing Regulations.

SECRETARIAL STANDARDS

During the year under review, your Company has complied with
the Secretarial Standard 1 and 2 on ''Meetings of the Board of
Directors'' and on ''General Meetings'', respectively, issued by
the Institute of Company Secretaries of India and notified by
the Ministry of Corporate Affairs, in terms of Section 118(10)
of the Act.

MAINTENANCE OF COST RECORDS

Your Company is not engaged in the business of production
of goods or providing of services as specified in Rule 3 of the
Companies (Cost Records and Audit) Rules, 2014 ("Rulesâ).
Accordingly, the requirement of maintaining cost records in
accordance with Section 148(1) of the Act read with the Rules
is not applicable to the Company for the period under review.

ACKNOWLEDGEMENT

The Board wishes to place on record its appreciation for the
assistance, co-operation and encouragement extended to the
Company by its'' customers, business partners, brands, bankers,
authorities and other stakeholders.

The Directors take this opportunity to place on record their warm
appreciation for the valuable contribution, untiring efforts and
spirit of dedication demonstrated by the employees and officers
at all levels, in ensuring an excellent all- around operational
performance. We applaud them for their superior levels of
competence, solidarity, and commitment to the Company. The
Directors would also like to thank the shareholders for their
wholehearted support and contribution. We look forward to their
continued support in future.

For and on behalf of the Board of Directors

Falguni Nayar

Executive Chairperson, Managing Director & CEO

DIN: 00003633

Place: Rome, Italy
Date: May 30, 2025

Mar 31, 2024

Your Board of Directors ("Board") are pleased to present the Twelfth (12^th) Annual Report of FSN E-Commerce Ventures Limited ("your Companyâ or "the Companyâ or "Nykaaâ) together with the Audited Financial Statements of the Company, for the financial year ended March 31, 2024 ("the year under reviewâ or "the yearâ or "FY 2023-24â).

FINANCIAL PERFORMANCE - AN OVERVIEW

(C in Millions)

Particulars	Standalone		Consolidated
Particulars	2023-24	2022-23*	2023-24	2022-23
Revenue from Operations	2,579.60	2,754.56	63,856.26	51,438.00
Other Income	1,846.03	1,287.73	299.42	302.13
Total Income	4,425.63	4,042.29	64,155.68	51,740.13
Total Expenditure	3,52 5.80	3,278.29	63,465.41	51,356.18
Profit before Tax	899.83	764.00	690.27	383.95
Current Tax	90.04	157.90	1,067.35	861.11
Deferred Tax (Credit)/Expenses	(361.i1)	35.28	(814.24)	(725.37)
Profit after Tax	1,170.90	570.82	437.16	248.21
Share in loss of associate	-	-	(39.67)	(38.60)
Profit for the period	1,170.90	570.82	397.49	209.61
Other Comprehensive Income / Loss (OCI)	1.96	(2.20)	4.43	1.57
Total Comprehensive Income	1,172.86	568.62	401.92	211.18
Balance in the Profit/(Loss) Account in the Balance Sheet	2,468.79	1,364.37	(61.48)	(388.88)

* Restated on account of acquisition of business (Refer note 5 5 of the standalone financial statements).

REVIEW OF OPERATIONS

During the year under review, the Standalone income of your Company increased to ?4,425.63 million as compared to ?4,042.29 million in the previous year, registering a growth of 9.48%. The Standalone profit after tax for the year was C1,170.90 million as compared to C570.82 million in the previous year registering increase of 105.13%.

During the year under review, the Consolidated income of the Group increased to ?64,155.68 million compared to C51,740.13 million in the previous year, registering growth of 24.00%. The Consolidated profit for the period for the Group was C397.49 million as compared to C209.61 million in the previous year registering increase of 89.63%.

The operating and financial performance of your Company has been covered in the Management Discussion and Analysis Report which forms part of the Annual Report.

DETAILS OF MATERIAL CHANGES AND COMMITMENTS FROM THE END OF THE FINANCIAL YEAR

There are no material changes and commitments affecting the financial position of your Company, which have occurred between the end of the FY 2023-24 and the date of this report. Further, there has been no change in the nature of business of your Company.

RESERVES

There is no amount proposed to be transferred to the reserves.

DIVIDEND

Your Board did not recommend any dividend on the equity shares of the Company for financial year ended March 31, 2024 considering that the Company is in growth stage and requires funds to support its growth objectives.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations"), your Company has formulated a Dividend Distribution Policy, with an objective to provide the dividend distribution framework to the stakeholders of the Company. The policy sets out various internal and external factors, which shall be considered by the Board in determining the dividend pay-out. The policy is available on the website of the Company at: Dividend Distribution Policy

SHARE CAPITAL

The details of changes in paid-up equity share capital during the year under review, are as under:

#	Paid-up Equity Share Capital	D in Million
A	At the beginning of the year, i.e., as on April 01, 2023	2,852.45
B	Allotments made pursuant to exercise of vested stock options under the various employee stock option schemes of the Company	3.54
C	At the end of the year, i.e., as on March 31, 2024 (C=A B)	2,855.99

STANDALONE AND CONSOLIDATED FINANCIAL STATEMENTS

The audited financial statements of the Company are drawn up, both on Standalone and Consolidated basis, for the financial year ended March 31, 2024, in accordance with the requirements of the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under Section 133 of the Companies Act, 2013 ("Act") read with relevant Rules and other accounting principles. The Consolidated Financial Statement has been prepared based on the financial statements received from Subsidiaries and Associate company, as approved by their respective Board of Directors.

STRATEGIC INITIATIVES DURING THE YEAR UNDER REVIEW AND TILL THE DATE OF THIS REPORT

The Company strives to create and enhance the value for its shareholder through synergising and optimising its business operations and thus, in line with your Company''s Value of ''Be Better Everyday'', the following strategic initiatives were taken during the year under review:

A. ACQUISITION OF LINGERIE AND ATHLEISURE BUSINESS FROM NYKAA FASHION LIMITED BY THE COMPANY

Your Board, at its meeting held on February 06, 2024, had approved acquisition of athleisure and lingerie business of Nykaa Fashion Limited, wholly owned subsidiary of the Company, as a going concern on a slump sale basis via business transfer agreement and the same was completed by the Company during the financial year under review.

This transaction will enable the owned brands business to grow through improved focus. Further, Nykaa Fashion will become a distinct platform which will enable improved partner relationship.

B. DEMERGER OF E-B2B BUSINESS FROM FSN DISTRIBUTION LIMITED TO NYKAA E-RETAIL LIMITED

Your Board, at its meeting held on February 06, 2024, had approved Scheme of Arrangement between FSN Distribution Limited and Nykaa E-Retail Limited, Wholly owned subsidiaries of the Company, and their respective shareholders and creditors.

Nykaa E-Retail Limited primarily has an inventory led business model to sell beauty and personal care products of own brands as well as third party brands through online channels

i.e., its own online platforms and websites. FSN Distribution Limited has a B2B inventory led business model to sell beauty and personal care products through its distribution networks using online as well as offline sales channels. The Scheme comprises of demerger of online B2B beauty business from FSN Distribution Limited to Nykaa E- Retail Limited. Post demerger, residual business of offline B2B business i.e. General / Modern Trade Business will continue in FSN Distribution Limited.

This demerger will facilitate synergy in operations such as effective utilization of warehouse and office space, synergy in technology cost and overheads. It will further result into consolidation of beauty online business under one entity; reduction in compliances, intercompany transactions and improve customer experience.

C. ACQUISITION OF WESTERN WEAR AND ACCESSORIES BUSINESS BY WAY OF SLUMP SALE FROM NYKAA FASHION LIMITED

Your Board, at its meeting held on May 22, 2024, had approved the proposal to acquire the Western Wear and Accessories business of Nykaa Fashion Limited ("Transferor Companyâ), which is a wholly owned subsidiary of the Company, as a going concern on a slump sale basis, in accordance with the business transfer agreement ("BTA") to be entered between the Company and the Transferor Company. The expected date of completion of the acquisition is by September 30, 2024. The total cost of acquisition is approximately ? 1,337 million.

D. TRANSFER OF 100% EQUITY STAKE HELD IN ILUMINAR MEDIA LIMITED (LBB) TO NYKAA FASHION LIMITED WITH AN OBJECTIVE TO AMALGAMATE LBB WITH NYKAA FASHION LIMITED IN DUE COURSE

Your Board, at its meeting held on May 22, 2024, had approved transfer of 100% equity stake held in Iluminar Media Limited ("LBB") to Nykaa Fashion Limited, which is a wholly owned subsidiary of the Company. The Board of Directors of the Company had given its in-principle approval for the proposal to amalgamate Iluminar Media Limited ("Transferor Company") with Nykaa Fashion Limited ("Transferee Company") under sections 230-232 of the Act and the rules and regulations made thereunder. The Transferor Company and the Transferee Company are wholly owned subsidiaries of the Company. LBB have also initiated the process for shifting its registered office from Delhi to Mumbai, Maharashtra.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES

As on March 31, 2024, the Company has ten direct subsidiaries, four step-down subsidiaries and one associate company. Following subsidiaries were converted from Private Company to Public Company during the year under review:

(i) Nykaa E-Retail Private Limited to Nykaa E-Retail Limited;

(ii) Nykaa Fashion Private Limited to Nykaa Fashion Limited;

(iii) FSN International Private Limited to FSN International Limited;

(iv) Iluminar Media Private Limited to Iluminar Media Limited; and

(v) FSN Distribution Private Limited to FSN Distribution Limited.

Nessa International Holdings Limited (''Nessa International''), Step down subsidiary of the Company based out of UAE had incorporated a wholly-owned subsidiary, Nysaa Beauty LLC in Dubai, during the year under review.

Pursuant to the provisions of Section 129(3) of the Act read with the Companies (Accounts) Rules, 2014 and in accordance with applicable accounting standards, a statement containing the salient features of financial statements of your Company''s Subsidiaries and Associate Company in Form No. AOC-1 is annexed as Annexure â I to this Report.

In accordance with the provisions of Section 136 of the Act and the amendments thereto, and the Listing Regulations, the Audited Financial Statements, including the Consolidated Financial Statements and related information of the Company and financial statements of your Company''s Subsidiaries and Joint Ventures have been placed on the website of your Company viz. https://www. nykaa.com/subsidiaries-fy-23-24/lp.

Your Company has formulated a Policy for determining Material Subsidiaries. The said policy is available on the website of the Company at: Policy for determining Material Subsidiaries.

During the year under review, Nykaa E-Retail Limited, FSN Brands Marketing Private Limited and Nykaa Fashion Limited were material subsidiaries of the Company as per Regulation 16 of the Listing Regulations, while Nykaa E-Retail Limited and FSN Brands Marketing Private Limited were material subsidiaries of the Company as per Regulation 24 of the Listing Regulations, which requires appointment of one of the Company''s independent directors on the boards of the material subsidiary company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under the Listing Regulations, is presented in a separate section, forming a part of the Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI vide Circular No. SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 06, 2017, had recommended voluntary adoption of ''Integrated Reporting'' by the top 500 listed companies. SEBI has also mandated the requirement of submission of Business Responsibility and Sustainability Report (''BRSR'') with effect from the financial year 2022-23 under Regulation 34(2)(f) of the Listing Regulations.

SEBI vide its Notification dated December 26, 2019 and consequent amendments carried out to the Listing Regulations has made the Business Responsibility and Sustainability Report (BRSR) applicable to the top 1,000 listed entities (by market capitalisation) for reporting on a mandatory basis from FY 2022-23.

An Integrated Report intends to give a holistic picture of an organisation''s performance and prospects to the providers of financial capital and other stakeholders. It is thus widely regarded as the future of corporate reporting. In line with the global trends on Environmental, Social, and Governance ("ESGâ), your Company continues with its integrated reporting journey in the current fiscal for comprehensive review of the financial and non-financial factors enabling better assessment of the Company''s long-term perspective. The Board acknowledges its responsibility for the integrity of the report and the information contained therein.

The BRSR for the year under review, containing the initiatives taken by your Company from social and governance perspective, forms an integral part of the Annual Report.

CORPORATE GOVERNANCE

Your Company embeds sound Corporate Governance practices and constantly strives to adopt emerging best practices. It has always been the Company''s endeavour to excel through better Corporate Governance and fair and transparent practices. A Report on Corporate Governance forms part of this Report as ''Annexure â II''.

M/s. S. N. Ananthasubramanian & Co., Company Secretaries, the Secretarial Auditor of the Company vide their certificate dated May 22, 2024, have confirmed that the Company is and has been compliant with the conditions stipulated in the chapter IV of the Listing Regulations. The said certificate is annexed as ''Annexure â III'' to this Report.

ANNUAL RETURN

The Annual Return of the Company as on March 31, 2024 in Form MGT - 7 in accordance with Section 92(3) and Section 134(3)

(a) of the Act as amended from time to time and the Companies (Management and Administration) Rules, 2014, will be made available on the website of the Company at: https://www.nvkaa. com/annual-report/lp.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Act, with respect to Directors'' Responsibility Statement, the Directors of the Company confirm that:

(a) in the preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards had been followed and there are no material departures from the same;

(b) the Directors had selected such 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 profits of the Company for the year ended on that date;

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

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

(e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

AUDITORS AND THEIR REPORT

(i) Statutory Auditors

M/s. S. R. Batilboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/E300004), were reappointed as Statutory Auditors of the Company at the 9th AGM of the Company held on September 29, 2021, to hold office till the conclusion of the 14th AGM to be held for the FY 2025-26.

In terms of Section 139 and 141 of the Act and relevant Rules prescribed thereunder, M/s. S. R. Batilboi & Associates LLP, Chartered Accountants has confirmed that they are not disqualified from continuing as Auditors of the Company. The Auditors have also confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI.

The Auditors have issued an unmodified opinion on the Financial Statements for the financial year 2023-24 and the Auditor''s Report forms part of this Annual Report. The Auditor''s Report does not contain any qualification, reservation or adverse remark.

(ii) Secretarial Auditor

In terms of the provisions of Section 204 of the Act read with Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the Listing Regulations, your Company has appointed M/s. S. N. Ananthasubramanian & Co., Company Secretaries, as Secretarial Auditor to conduct Secretarial Audit of the Company for FY 2023-24. The Secretarial Audit Report of the Company does not contain any qualification, reservation, adverse remark or disclaimer.

Further, in compliance of Regulation 24A of the Listing Regulations, Company''s unlisted material subsidiaries also undergo Secretarial Audit and the Secretarial Audit Reports of the Company and its unlisted material subsidiaries thereto in the prescribed Form No. MR-3 is attached as Annexure - IV, IV(A), IV(B) and IV(C) forming part of this Report. The same are also available on the website of the Company.

DISCLOSURES IN TERMS OF THE PROVISIONS OF THE ACT & THE LISTING REGULATIONS

A. Board of Directors ("Board")

(i) Number of meetings

The Board met 5 (Five) times during the year under review. The details of such meetings are disclosed in the Corporate Governance Report forming part of this Annual Report.

The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Act.

(ii) Directors retiring by rotation

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Sanjay Nayar, NonExecutive (Non-Independent) Director and Mr. Anchit Nayar, Executive Director, are due to retire by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. The Board of Directors on the recommendation of the Nomination and Remuneration Committee ("NRC") has recommended their re-appointment.

Resolution seeking their re-appointment along-with their profile as required under Regulation 36(3) of the Listing Regulations forms part of the Notice of Twelfth Annual General Meeting.

(iii) Board evaluation

The Nomination and Remuneration Committee and the Board of Directors reviewed the Board evaluation framework and process for the financial year 2023-2024 to further strengthen the criteria, parameters and sharpness of rating/feedback for Board, its Committees & individual Board Members.

Pursuant to applicable provisions of the Act and the Listing Regulations, the Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors. The framework is monitored, reviewed and updated by the Board, in consultation with the Nomination and Remuneration Committee, in accordance with the new compliance requirements.

The annual performance evaluation of the Board, its Committees and each Director has been carried out for the financial year 2023-24 in accordance with the framework. The details of evaluation process of the Board, its Committees and Individual Directors, including Independent Directors have been provided under the Corporate Governance Report which forms part of this Report.

The Policy on Board of Directors'' Evaluation Framework can be accessed at: Policy on Board of Directors'' Evaluation Framework

(iv) Declaration of independence

The Company has received necessary declaration from each Independent Director of the Company stating that:

(i) they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations; and

(ii) they have registered their names in the Independent Directors'' Databank maintained by the Indian Institute of Corporate Affairs as required vide Rule 6 (1) & (2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014.

Based on the declarations received from the Directors, the Board confirms that the Independent Directors fulfil the conditions as specified under Schedule V of the Listing Regulations and are independent of the management.

(v) Familiarisation programme for Independent Directors

Disclosure pertaining to familiarisation programme for Independent Directors is provided in the Corporate Governance Report forming part of this Annual Report.

B. Committees of the Board

The Board has constituted five committees which are mandated by the Act and the Listing Regulations, viz.

(i) Audit Committee,

(ii) Nomination and Remuneration Committee,

(iii) Stakeholders'' Relationship Committee,

(iv) Risk Management Committee and

(v) Corporate Social Responsibility & Environmental, Social, and Governance Committee.

In addition to the said committees, the Board has also constituted Fundraise and Investment Committee.

Details of all the committees, along with their charters, composition and meetings held during the year, are provided in the Corporate Governance Report forming part of this Annual Report.

C. Directors and Key Managerial Personnel

During the year, following were the changes in Director/ Key Managerial Personnel:

1. Mr. Neelabja Chakrabarty has been appointed as the Company Secretary & Compliance Officer with effect from February 08, 2024, in place of Mr. Sujeet Jain. Mr. Sujeet Jain continues to be the Chief Legal and Regulatory Officer of the Company.

After the year end and upto the date of the Report, following are the changes in Director/ Key Managerial Personnel:

1. The Board of Directors at its meeting held on May 22, 2024, on the recommendation of Nomination and Remuneration Committee, has approved the re-appointment of Mr. Pradeep Parameswaran as an Independent Director for a term of 3 (three) years to be effective from July 15, 2024, subject to approval of the shareholders.

2. The Board of Directors at its meeting held on May 22, 2024, on the recommendation of Nomination and Remuneration Committee, has approved the re-appointment of Mr. Seshashayee Sridhara as an Independent Director for a term of 3 (three) years to be effective from July 26, 2024, subject to approval of the shareholders.

3. The Board of Directors at its meeting held on May 22, 2024, on the recommendation of Nomination and Remuneration Committee, has approved the

appointment of Mr. Santosh Desai as an Independent Director for a term of 3 (three) years to be effective from July 15, 2024, subject to approval of the shareholders.

4. Ms. Alpana Parida shall complete her term as an Independent Director of the Company on July 14, 2024 and hence shall cease to be a Director of the Company effective end of the day, July 14, 2024.

In accordance with the provisions of Sections 2(51) and 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are the Key Managerial Personnel of the Company:

(a) Ms. Falguni Nayar - Executive Chairperson, Managing Director and Chief Executive Officer;

(b) Mr. P. Ganesh - Chief Financial Officer

(c) Mr. Sujeet Jain - Chief Legal and Regulatory Officer, Company Secretary & Compliance Officer (till February 07, 2024)*

(d) Mr. Neelabja Chakrabarty - Company Secretary & Compliance Officer (appointed w.e.f. February 08, 2024)

* Mr. Sujeet Jain ceased to be the Company Secretary & Compliance Officer of the Company, with effect from close of business hours on February 07, 2024. Mr. Sujeet Jain continues to be the Chief Legal and Regulatory Officer of the Company.

D. Remuneration of Directors and Employees

Disclosure comprising particulars with respect to the remuneration of Directors and employees and other details, as required to be disclosed in terms of the provisions of Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as "Annexure - V" to this Report.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of this Report.

Further, in terms of the second proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such information may write to the Company Secretary or e-mail at nvkaacompanvsecretarv@ nvkaa.com.

Your Company has adopted ''Remuneration Policy for Directors, Key Managerial Personnel and other Employees'' which sets out criteria for the remuneration for Directors, Key Managerial Personnels (''KMPs'') and Employees which can be accessed at: Remuneration Policy for Directors, KMPs and other Employees.

E. Vigil Mechanism/Whistle-Blower

Your Company believes in conduct of the affairs of its business in a fair and transparent manner by adopting highest standards of honesty, integrity, professionalism, and ethical behavior.

Your Company has established a Vigil Mechanism/Whistle-Blower Policy ("Policyâ) in accordance with the provisions of the Act and the Listing Regulations with a view to provide a platform and mechanism for Employees, Directors and other stakeholders of the Company to report actual or suspected unethical behaviour, fraud or violation of the Company''s Code of Conduct, ethics, principles and matters specified in the Policy without any fear of retaliation, and also provide for direct access to the Chairperson of the Audit Committee as the case may be, in exceptional cases.

Employees and other stakeholders are encouraged to report actual or suspected concerns or violations of applicable laws and regulations and the Code of Conduct. Such genuine concerns or violations are called ''Protected Disclosures'' which can be raised by a Whistle-blower to "Speak-up Helplineâ (an external independent agency appointed by the Company to receive and attend to the Protected Disclosures through toll-free number/e-mail/web portal), established in terms of the Policy.

The Company affirms that in compliance with the WhistleBlower Policy/Vigil Mechanism, no personnel had been denied access to the Audit Committee. The Policy is available on the Company''s website and can be accessed at: Whistle-Blower Policy/Vigil Mechanism.

F. Corporate Social Responsibility (''CSR'')

A brief outline of the CSR Philosophy, salient features of the CSR Policy of the Company, the CSR initiatives undertaken during the financial year 2023-24 together with progress thereon and the report on CSR activities in the prescribed format, as required under Section 134(3)(o) read with Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure - VI to this Report and the CSR Policy can be accessed using the link CSR Policy.

G. Employee Stock Option Scheme and Share Based Employee Benefits

Your Company grants employee stock options that would enable the employees to share the value they create for the Company in the years to come. Accordingly, pursuant to the approval of Board and shareholders of the Company and in terms of the provisions of applicable laws, your Company has instituted Employees Stock Options Scheme - 2012 ("ESOS 2012"), FSN Employees Stock Scheme - 2017 ("ESOS 2017"), FSN E-Commerce Ventures Limited - Employee Stock Option Plan 2022" ("ESOP 2022") and FSN E-Commerce Ventures Limited - Employee Stock Unit Plan 2022 ("Stock Unit Plan 2022") for grant of stock options to eligible employees.

The Nomination and Remuneration Committee of the Board of Directors of the Company, inter-alia, administers and monitors the ESOS & RSU Schemes, in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SEBI SBEB Regulations"). During the year under review, there is no material change in the ESOS & RSU Schemes, and they are in compliance with the provisions of SEBI SBEB Regulations and other applicable provisions of law.

The applicable disclosures as stipulated under Regulation 14 of SEBI SBEB Regulations with regard to the ESOP & RSU Schemes of the Company are available on the website of the Company and weblink for the same is https://www.nvkaa. com/annual-report/lp.

A certificate from M/s. S. N. Ananthasubramanian & Co., Company Secretaries, the Secretarial Auditor of the Company, confirming that the aforesaid ESOP & RSU Schemes have been implemented in accordance with the SEBI SBEB Regulations, will be open for inspection at the ensuing Twelfth Annual General Meeting.

H. Investor Education and Protection Fund (''IEPF'')

The Company, till date, is not required to transfer any amount to the IEPF Account in terms of the provisions of the Companies Act, 2013 and the rules thereunder.

I. Related Party Transactions

All transactions with related parties were reviewed and approved by the Audit Committee and are in accordance with the Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions and the Related Party Framework, formulated and adopted by the Company. An omnibus approval from the Audit Committee is obtained for the related party transactions which are unforeseen in nature.

All contracts/arrangements/transactions entered into by the Company during the year under review with Related Parties were in the ordinary course of business and on arm''s length. During the year under review, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which is required to be reported in Form No. AOC-2 in terms of Section 134(3) (h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. Accordingly, there are no transactions that are required to be reported in Form AOC-2.

The Company''s Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions is available on the website of the Company at: Related Party Transactions Policy.

The details of the related party transactions as per Indian Accounting Standards (IND AS) - 24 are set out in the Standalone Financial Statement of the Company. The Company, in terms of Regulation 23 of the Listing Regulations, submits within the stipulated time from the date of publication of its standalone and consolidated financial results for the half year, disclosures of related party transactions, in the specified format to the stock exchanges. The said disclosures can be accessed on the website of the Company at: https://www.nykaa.com/quarterly-half-yearly-annual-filings-2024/lp.

J. Conservation of Energy, Technology

Absorption, Foreign Exchange Earnings and Outgo

Considering the nature of business of your Company, the particulars with respect to conservation of energy and technology absorption required as per Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, are not applicable to the Company.

The foreign exchange earnings and outgo are as below:

Particulars	2023-24	2022-23
Earnings in Foreign Exchange	Nil	Nil
Expenditure in Foreign Exchange	C80.50 million	C139.63 million

K. Risk Management

Your Company has a risk management framework that supports decision making across various levels, across the enterprise while being designed to proactively identify, assess and mitigate risks.

Furthermore, the Enterprise Risk Management (''ERM'') Governance Structure of your Company identifies the key internal stakeholders responsible for creating, implementing and sustaining ERM in the organisation.

The Board of Directors of the Company has formed a Risk Management Committee to frame, implement, and monitor the risk management plan for the Company. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Committee considers the risks that impact the mid-term to the long-term objectives of the business, including those reputational in nature.

The Company endeavours to continually strengthen its Risk Management systems and processes in line with a rapidly changing business environment. There are no risks which in the opinion of the Board threaten the existence of the Company. Details of various risks faced by your Company are provided in the Management Discussion & Analysis Report.

Your Company has framed and implemented a Risk Management Policy in terms of the provisions of Regulation 21 of the Listing Regulations, for the assessment and minimisation of risk, including identification therein of elements of risk, if any, which may threaten the existence of the Company. The policy can be accessed at Risk Management Policy

L. Internal Financial Control

mandate the need for an effective Internal Financial Control system in the Company which should be adequate and shall operate effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Board''s Report.

The Company has adequate Internal Financial Control System over financial reporting ensuring that all transactions are authorised, recorded, and reported correctly in a timely manner to provide reliable financial information and to comply with applicable accounting standards which commensurate with the size and volume of business of the Company.

The key internal financial controls have been documented, automated wherever possible and embedded in the respective business processes. Assurance to the Board on the effectiveness of internal financial controls is obtained through 3 Lines of Defence which include:

(a) Management reviews and self-assessment;

(b) Continuous controls monitoring by functional experts; and

The Company believes that these systems provide reasonable assurance that the Company''s internal financial controls are adequate and are operating effectively, as intended. During the year under review, such controls were tested by the Statutory Auditors of the Company and no material weaknesses or significant deficiencies in the design or operations were observed and reported by the Statutory Auditors. Details of the internal controls system are provided in the Management Discussion & Analysis Report.

M. Policy on Directors'' Appointment and Remuneration

In terms of Section 178 of the Act and Regulation 19 of the Listing Regulations, the Board of your Company, on recommendation of the Nomination and Remuneration Committee ("NRCâ), had adopted a "Remuneration Policy for Directors, Key Managerial Personal (''KMP'') and other employeesâ (''Remuneration Policy'') and "Policy on Board Diversityâ.

The Company''s Remuneration Policy is directed towards designing remuneration so as to attract, retain, and reward talent who will contribute to long-term success of the Company and build value for its shareholders. Objective of Board Diversity Policy is to ensure that the Board is fully diversified and comprises of an ideal combination of Executive and Non-Executive Directors, including Independent Directors, with diverse backgrounds.

The salient features of the policies are outlined in the Corporate Governance Report and the policies are made available on the Company''s website, which can be accessed using the link https://www.nykaa.com/policies.

N. Particulars of Loans, Guarantees and Investments

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security provided is proposed to be utilised by the recipient are provided in the Standalone Financial Statement.

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

In compliance with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made thereunder, your Company has adopted a Prevention of Sexual Harassment Policy for the prevention of sexual harassment and constituted Internal Complaints Committee to deal with complaints relating to sexual harassment at workplace. For details, kindly refer to relevant disclosures in the Corporate Governance Report which forms part of the Annual Report 2023-24.

P. Environment & Safety

Your Company is conscious of the importance of environmentally clean and safe operations and has framed and adopted Health, Safety and Environment (HSE) Policy which can be accessed at Health, Safety and Environment Policy. The Company''s policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

Your Company is committed to the highest standards of health, safety and environment practices within the organisation and the extended areas within its influence, with an aim to provide safe and healthy working environment to the employees, customers, business partners, suppliers and visitors.

During the year under review, the Company continued its waste management efforts through various environment friendly measures i.e. use of eco-friendly packaging material, recycling of plastic waste and redesigning packaging to reduce plastic waste. Scrap disposal is in line with industry benchmarks.

GENERAL

Your directors state that no disclosure or reporting is required

in respect of the following items as there were no transactions/

events on these items during the year under review:

â¢ There was no change in the nature of business of your Company as stipulated under sub-rule 5(ii) of Rule 8 of Companies (Accounts) Rules, 2014.

â¢ Details relating to deposits covered under Chapter V of the Act since your Company has not accepted any deposits from the public falling under Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014.

â¢ No significant or material orders were passed by the Regulators or Courts or Tribunals, which impact the going concern status and Company''s operations in future.

â¢ Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except Employees'' Stock Options Schemes referred to in this Report.

â¢ No fraud has been reported by the Auditors to the Audit Committee or the Board.

â¢ There is no application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the FY 2023-24.

â¢ The Company has not made any one-time settlement for the loans taken from the Banks or Financial Institutions, therefore, the same is not applicable.

â¢ Your Company has not issued Equity shares with differential rights as to dividend, voting or otherwise; and

â¢ Your Company has not raised funds through preferential allotment or qualified institutions placement as per Regulation 32(7A) of the Listing Regulations.

SECRETARIAL STANDARDS

During the year under review, your Company has complied with the Secretarial Standards 1 and 2 on meetings of the Board of Directors and on General Meetings, respectively, issued by the Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs, in terms of Section 118(10) of the Act.

MAINTENANCE OF COST RECORDS

Your Company is not engaged in the business of production of goods or providing of services as specified in Rule 3 of the Companies (Cost Records and Audit) Rules, 2014 ("Rulesâ). Accordingly, the requirement of maintaining cost records in accordance with Section 148(1) of the Act read with the Rules is not applicable to the Company for the period under review.

ACKNOWLEDGEMENT

The Board wishes to place on record its appreciation for the assistance, co-operation and encouragement extended to the Company by the Company''s customers, business partners, brands, bankers and other stakeholders.

The Directors take this opportunity to place on record their warm appreciation for the valuable contribution, untiring efforts and spirit of dedication demonstrated by the employees and officers at all levels, in ensuring an excellent all-around operational performance. We applaud them for their superior levels of competence, solidarity, and commitment to the Company. The Directors would also like to thank the shareholders for their wholehearted support and contribution. We look forward to their continued support in future.

For and on behalf of the Board of Directors Falguni Nayar

Executive Chairperson, Managing Director & CEO

DIN: 00003633

Place: Mumbai Date: May 22, 2024

Mar 31, 2023

Your Board of Directors (âBoardâ) present the Eleventh (11^th) Annual Report of FSN E-Commerce Ventures Limited (âyour Companyâ or âthe Companyâ or âNykaaâ) together with the Audited Financial Statements of the Company, for the financial year ended March 31, 2023 (âthe year under reviewâ or âthe yearâ or âFY 2022-23â).

FINANCIAL PERFORMANCE - AN OVERVIEW

(H in Millions)
Particulars	Standalone		Consolidated
Particulars	2022-23	2021-22	2022-23	2021-22
Revenue from Operations	2,177.99	1,876.99	51,438.00	37,739.35
Other Income	1,286.86	1,157.07	302.13	269.72
Total Income	3,464.85	3,034.06	51,740.13	38,009.07
Total Expenditure	2,658.58	1,817.14	51,356.18	37,536.01
Profit/(Loss) before Tax	806.27	1,216.92	383.95	473.06
Current Tax	157.90	64.46	861.11	446.39
Deferred Tax Expenses/(Credit)	35.28	117.33	(725.37)	(386.21)
Profit/(Loss) after Tax	613.09	1,035.13	248.21	412.88
Share in loss of associate	-	-	(38.60)	-
Profit for the period	613.09	1,035.13	209.61	412.88
Other Comprehensive Income / Loss (OCI)	(2.20)	(19.06)	1.57	5.56
Total Comprehensive Income	610.89	1,016.07	211.18	418.44
Balance in the Profit/(Loss) Account in the Balance Sheet	1,364.38	751.29	(388.88)	(581.50)

REVIEW OF OPERATIONS

During the year under review, the Standalone income of your Company increased to H 3,464.85 million compared to H 3,034.06 million in the previous year, registering growth of 14%. The Standalone profit after tax for the year was H 613.09 million as compared to H 1,035.13 million in the previous year registering decrease of 41%.

During the year under review, the Consolidated income of the Group increased to H 51,740.13 million compared to H 38,009.07 million in the previous year, registering growth of 36%. The Consolidated profit after tax for the Group was H 209.61 million as compared to H 412.88 million in the previous year registering decrease of 49%.

The operating and financial performance of your Company has been covered in the Management Discussion and Analysis Report which forms part of the Annual Report.

DETAILS OF MATERIAL CHANGES AND COMMITMENTS FROM THE END OF THE FINANCIAL YEAR

There are no material changes and commitments affecting the financial position of your Company, which have occurred between the end of the FY 2022-23 and the date of this report. Further, there has been no change in the nature of business of your Company.

RESERVES

There is no amount proposed to be transferred to the reserves.

DIVIDEND

Your Board do not recommend any dividend on the equity shares of the Company for financial year ended March 31, 2023 considering that the Company is in growth stage and require funds to support its growth objectives.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), your Company has formulated a Dividend Distribution Policy, with an objective to provide the dividend distribution framework to the stakeholders of the Company. The policy sets out various internal and external factors, which shall be considered by the Board in determining the dividend pay-out. The policy is available on the website of the Company at https://www.nykaa.com/ media/wysiwyg/2021/Investors-Relations/pdfs/10-11/ Dividend-Distribution-Policy.pdf

SHARE CAPITAL
The	Details of changes in paid-up equity share capital during the year under review, are as under:
#	Paid-up Equity Share Capital '' in Million
A	At the beginning of the year, i.e., as on April 01, 2022 474.10
B	Pre-Bonus Allotments made pursuant to:
	(i) Employees Stock Options Scheme - 2012 0.01
	(ii) FSN Employees Stock Scheme - 2017 0.60
C	Sub-Total of C (A B) 474.71
D	Bonus Issue of Shares (in ratio of 5:1)⁽¹⁾ 2,373.57
E	Post-Bonus Allotments made pursuant to:
	(i) Employees Stock Options Scheme - 2012 0.04
	(ii) FSN Employees Stock Scheme - 2017 4.13
F	Sub-Total of F (D E) 2,377.74
At the end of the year, i.e., as on March 31, 2023 (C F) 2,852.45
⁽¹⁾With a view to encourage the participation of retail investors in the long term, increasing the overall tradeable float/activity level in the equity shares and retail diversification of shareholding, your Board at its meeting held on October 03, 2022, subject to consent of the members of the Company, approved and recommended issue of bonus equity shares of H 1/- each credited as fully paid-up to eligible members of the Company in the proportion of 5 new fully
paid-	up equity share of H 1/- each for every 1 existing fully paid-up equity share of H 1/- each by capitalising a sum not exceeding H 2,373,563,075/- out of
Securities Premium Account. On November 12, 2022, subsequent to the approval of shareholders vide Postal Ballot, which concluded on November 02, 2022, the Company had allotted 2,373,563,075 fully paid-up equity shares of face value H 1/- each in the ratio of 5:1 i.e., five equity share for every one existing equity share held by the members in the Company on November 11, 2022 (the ârecord dateâ fixed for this purpose).

Further, during the year under review, the Company reclassified the authorized share capital from H 3,250,000,000/- comprising of 2,750,000,000 equity shares of H1 each and 500,000,000 preference shares of H1 each to H 3,250,000,000/- divided into 3,250,000,000 equity shares of H1 each and consequently altered the Capital Clause of Memorandum of Association of the Company.

STRATEGIC INITIATIVES DURING THE YEAR UNDER REVIEW AND TILL THE DATE OF THIS REPORT

A. ACQUISITION OF ILUMINAR MEDIA PRIVATE LIMITED (KNOWN AS âLITTLE BLACK BOOKâ)

Your Board, at its meeting held on August 05, 2022, had approved the execution of Share Purchase Agreement to acquire 100% fully diluted share capital of Iluminar Media Private Limited (âLittle Black Bookâ or âLBBâ) and on September 09, 2022, acquisition of 100% Equity Shares of Little Black Book by the Company was completed.

Investments in LBB aligns with Nykaaâs fundamental content-first approach to engaging with its loyal consumer base. LBBâs large, discerning user base, content creation capability, curation mindset and relationship with emerging brands makes it an attractive content powerhouse. Their focus on fashion, home and beauty categories fits well with Nykaaâs areas of strength.

Co-Founded by Suchita Salwan and Dhruv Mathur in 2015, LBB is involved in the business of running and operating a digital platform through https://lbb. in/ and a mobile application that serves as a lifestyle and recommendations platform. Gradually, LBB has evolved from a Tumblr-blog to a buzzing online, curated marketplace. LBB has built a brand and audience amongst Indiaâs urban millennials, reaching over 70 million users through their various channels. Their focus on audience engagement through content and discovery has made them a brand loved by their users and brand partners alike.

B. STRATEGIC ALLIANCE WITH APPAREL GROUP

Your Board at its meeting held on October 06, 2022, had approved execution of Share Purchase cum Shareholdersâ Agreement between FSN International Private Limited, a wholly owned subsidiary of the Company (âFSN Internationalâ) and Apparel Group, a global fashion and lifestyle retail conglomerate headquartered in the United Arab Emirates (UAE) (âApparelâ) for undertaking an omni-channel, multi branded beauty retail operation business in the countries that are part of the Gulf Cooperation Council (GCC) namely the Kingdom of Bahrain, State of Kuwait, Sultanate of Oman, State of Qatar, Kingdom of Saudi Arabia and UAE.

Founded by Sima Ved in 1996, the Apparel Group is one of the largest omnichannel retailers in the Middle East based out of the UAE. It is home to more than 75 lifestyle and beauty brands with over 2,000 stores in 14 countries. The Group brings over two decades of deep understanding of retailing in the GCC, having steadily kept their finger on the pulse of evolving consumer trends.

This Strategic Alliance with Apparel Group will benefit your Company in leveraging the Apparel Groupâs robust offline retail network and deep market relationships to build distinctive GCC-focused beauty offerings in the Kingdom of Bahrain, State of Kuwait, Sultanate of Oman, State of Qatar, Kingdom of Saudi Arabia and the UAE. Technology-led Nykaa is now set to bring its keen understanding of beauty category and strong partnerships with domestic and international brands to GCCâs beauty-forward consumers.

As these two retail powerhouses i.e., Nykaa and Apparel Group come together to harness each otherâs strengths, the GCC can expect a seamless, world-class beauty shopping experience that is both highly curated and discovery led. Poised for accelerated growth, especially in the beauty and personal care category, the GCC presents a large opportunity for Nykaa to extend its highly focused value offering and drive the regionâs offline and online retail growth story with the Apparel Group. As per a Red Seer report, KSA & the UAE, two of the regionâs biggest beauty and personal care markets, were sized at 17.1bn USD and 6.6bn USD respectively in 2021 and are projected to grow at a CAGR of 7% and 9% respectively over the next 3 years.

The business operations in GCC will be carried through âNessa International Holdings Limitedâ (âNessa Internationalâ), incorporated in the Abu Dhabi Global Market, in which FSN International is holding 55% stake and balance 45% is held by Apparel. As on March 31, 2023, FSN International has completed all necessary formalities with respect to the acquisition of 55% stake in Nessa International. Consequently, Nessa International has become the subsidiary of FSN International and step-down subsidiary of the Company.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES

As on March 31, 2023, the Company has ten direct subsidiaries, three step-down subsidiaries and one associate company. Following were the additions during the year under review:

(i) Nudge Wellness Private Limited became subsidiary of the Company w.e.f. June 30, 2022;

(ii) Nykaa Foundation became subsidiary of the Company w.e.f. June 08, 2022;

(iii) Iluminar Media Private Limited became wholly owned subsidiary of the Company w.e.f. September 09, 2022;

(iv) Nessa International Holdings Limited became subsidiary of the Company through FSN International Private Limited (wholly owned subsidiary of the Company) w.e.f. March 02, 2023; and

(v) Earth Rhythm Private Limited became associate company w.e.f. May 04, 2022.

The details of business carried on by the subsidiaries and associate company are as follows:

Nykaa E-Retail Private Limited (âNykaa E-Retailâ)

was incorporated on February 22, 2017 and is a 100% subsidiary of your Company. Nykaa E-Retail operates primarily using an inventory-led model and is engaged in the business of purchasing beauty, hygiene and wellness products directly from the manufacturers and selling such products through online channels i.e., its online platforms or websites, and other online applications.

Nykaa Fashion Private Limited (âNykaa Fashionâ) was

incorporated on February 04, 2019 and is a 100% subsidiary of your Company. Nykaa Fashion runs on marketplace, sale or return (SOR), and just-in-time inventory models. It is engaged in the business of selling and distribution of fashion garments and fashion accessories through online channels i.e., its online platforms or websites, other online applications and retail outlets, general trade and modern trade.

FSN Brands Marketing Private Limited (âFSN Brandsâ)

was incorporated on February 19, 2015 and is a 100% subsidiary of your Company. FSN Brands is engaged in the business of import, purchase, selling and distribution of beauty and wellness, personal care, health care, skin care, hair care and other related products through retail outlets, general trade and modern trade.

FSN International Private Limited (âFSN Internationalâ)

was incorporated on December 10, 2019 and is a 100% subsidiary of your Company. FSN International is engaged in the business of selling beauty, wellness, fitness, personal care, health care, skin care, hair care and other related products on/through e-commerce, m-commerce, internet, stores, stalls, etc.

FSN International Private Limited has three subsidiaries namely, FSN Global FZE, Dubai, Nykaa International UK Limited, United Kingdom (UK) and Nessa International Holdings Limited, UAE.

(i) FSN Global FZE (âFSN Globalâ) was incorporated on June 21, 2020 as the wholly owned subsidiary of FSN International and is engaged in the business of sale of cosmetics, beauty, personal care, skin care, hair care, beauty and personal care products and equipment through marketplace model.

(ii) Nykaa International UK Limited (âNykaa Internationalâ) was incorporated as the wholly owned subsidiary of FSN International on November 15, 2020 to engage in the business of sale of cosmetics, beauty, personal care, skin care and hair care products in UK.

(iii) Nessa International Holdings Limited (âNessa Internationalâ) was incorporated on October 05, 2022 and FSN International acquired its 55% stake on March 02, 2023. Nessa International has not yet commenced its operations and will undertake an omni-

channel, multi branded beauty retail operation business in the countries that are part of the Gulf Cooperation Council. For details, kindly refer to âStrategic Alliance with Apparel Groupâ.

FSN Distribution Private Limited (âFSN Distributionâ)

was incorporated on July 30, 2021 and is a wholly-owned subsidiary of your Company. FSN Distribution is in the business of selling beauty, hygiene and wellness products through its distribution network to the wholesalers and retailers using online and offline channels of sales.

Nykaa-KK Beauty Private Limited (âNykaa-KK Beautyâ)

was incorporated on July 13, 2018. Your Company entered into a Joint Venture Agreement with Katrina Kaif, Matrix India Entertainment Consultants Private Limited and Nykaa-KK Beauty on December 11, 2018 and holds 51% shares in Nykaa-KK Beauty which is engaged in the business of manufacturing, selling & distribution of âKay Beautyâ products on the online platforms or websites such as e-commerce, m-commerce, internet as well as through physical stores, stalls, general trade and modern trade etc.

Dot & Key Wellness Private Limited (âDot & Keyâ) was

acquired on September 28, 2021 and your Company holds 51% shares in it. Dot & Key is engaged in the business of manufacturing, marketing, branding and sale of skincare, personal care products and nutraceutical products, including serums, toners, cleansers, face masks, face creams and meltables.

Nykaa Foundation was incorporated on June 08, 2022 under the provisions of section 8 of the Companies Act, 2013 (âthe Actâ) to achieve CSR objectives of the Company and / or its subsidiaries and your Company holds 99.93% shares in it. Nykaa Foundation is involved in undertaking any or all of the permissible CSR activities set out in Schedule VII of the Act, on behalf of the Company or any other company / entity as may be legally permissible from time to time, in accordance with the applicable provisions of the Act, Companies (Corporate Social Responsibility Policy) Rules, 2014 and other applicable laws, as amended from time to time.

Nudge Wellness Private Limited (âNudge Wellnessâ) was

acquired on June 30, 2022 and your Company holds 60% shares in it. Nudge Wellness is a nutricosmetics wellness company engaged in the business of manufacturing and selling dietary supplement products on their website and other e-commerce websites. This acquisition marked Companyâs entry into owned brand of dietary supplement and other nutricosmetics products.

Earth Rhythm Private Limited (âEarth Rhythmâ) became an associate company on May 04, 2022 with the acquisition of 18.51% stake in it. Earth Rhythm is a personal care brand which manufactures and sells sustainable/non-toxic beauty products on their website and other e-commerce websites.

Iluminar Media Private Limited (âLittle Black Bookâ or âLBBâ)

was acquired on September 09, 2022 and is a wholly owned subsidiary of the Company. LBB is engaged in the business of operating a digital platform and mobile application that

serves as a lifestyle guide and recommendations platform. For details, kindly refer to âAcquisition of Iluminar Media Private Limited (known as âLittle Black Bookâ)â.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (âActâ) read with the Companies (Accounts) Rules, 2014 and in accordance with applicable accounting standards, a statement containing the salient features of financial statements of your Companyâs subsidiaries and Associate Company in Form No. AOC-1 is annexed as Annexure-I to this Report.

In accordance with the provisions of Section 136 of the Act and the amendments thereto, and the Listing Regulations, the audited Financial Statements, including the consolidated financial statements and related information of the Company and financial statements of your Companyâs subsidiaries and joint ventures have been placed on the website of your Company viz. https://www.nykaa.com/ investor-relations

During the year under review, Nykaa E-Retail and FSN Brands were material subsidiaries of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under the Listing Regulations, is presented in a separate section, forming part of the Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI vide Circular No. SEBI/HO/CFD/CMD/ CIR/P/2017/10 dated February 06, 2017, had recommended voluntary adoption of âIntegrated Reportingâ by the top 500 listed companies. SEBI has also mandated the requirement of submission of Business Responsibility and Sustainability Report (âBRSRâ) with effect from the financial year 2022-23 under Regulation 34(2)(f) of SEBI Listing Regulations.

An Integrated Report intends to give a holistic picture of an organisationâs performance and prospects to the providers of financial capital and other stakeholders. It is thus widely regarded as the future of corporate reporting. In line with the global trends on Environmental, Social, and Governance (âESGâ), your Company continues with its integrated reporting journey in the current fiscal for comprehensive review of the financial and non-financial factors enabling better assessment of the Companyâs long-term perspective. The previous year Integrated Report of the Company have been well-received by various stakeholders and have been awarded Asiaâs best category (first time) at the 8^thAsia Integrated Reporting Awards (AIRA). The AIRA

is widely considered the most distinguished accolade for integrated reporting in the region. The Board acknowledges its responsibility for the integrity of the report and the information contained therein.

In the previous year, the Business Responsibility Report (BRR) of the Company was being presented to the stakeholders as per the requirements of Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 describing the environmental, social and governance initiatives taken by the Company. SEBI vide its Notification dated December 26, 2019 and consequent amendments carried out to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, has made the Business Responsibility and Sustainability Report (BRSR) applicable to the top 1000 listed entities (by market capitalisation) for reporting on a mandatory basis from FY 2022-23.

The BRSR for the year under review, as stipulated under Regulation 34(2)(f) of the Listing Regulations, describing the initiatives taken by your Company from social and governance perspective, forms an integral part of the Annual Report.

STANDALONE AND CONSOLIDATED FINANCIAL STATEMENTS

The audited financial statements of the Company are drawn up, both on standalone and consolidated basis, for the financial year ended March 31, 2023, in accordance with the requirements of the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under Section 133 ofthe Act, read with relevant Rules and other accounting principles. The Consolidated Financial Statement has been prepared based on the financial statements received from subsidiaries and associate company, as approved by their respective Board of Directors.

CORPORATE GOVERNANCE

Your Company embeds sound Corporate Governance practices and constantly strives to adopt emerging best practices. It has always been the Companyâs endeavour to excel through better Corporate Governance and fair and transparent practices. A Report on Corporate Governance forms part of this Report as Annexure-II.

M/s. S. N. Ananthasubramanian & Co., Company Secretaries, the Secretarial Auditor of the Company vide their certificate dated May 23, 2023, have confirmed that the Company is and has been compliant with the conditions stipulated in the chapter IV of the Listing Regulations. The said certificate is annexed as Annexure-III to this Report.

ANNUAL RETURN

The Annual Return of the Company as on March 31, 2023 in Form MGT - 7 in accordance with Section 92(3) and Section 134(3)(a) of the Act as amended from time to time and the Companies (Management and Administration)

Rules, 2014, will be made available on the website of the

Company at https://www.nykaa.com/investor-relations.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the

Act, with respect to Directorsâ Responsibility Statement,

the Directors of the Company confirm that:

(a) in the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards had been followed and there are no material departures from the same;

(b) the Directors had selected such 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, 2023 and of the profits of the Company for the year ended on that date;

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

(e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

AUDITORS AND THEIR REPORT

(i) Statutory Auditors

M/s. S. R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No. 101049W/ E300004), were re-appointed as Statutory Auditors of the Company at the 9^th AGM of the Company held on September 29, 2021, to hold office till the conclusion of the 14^th AGM to be held for the FY 2025-26.

In terms of Section 139 and 141 of the Act and relevant Rules prescribed thereunder, M/s. S. R. Batliboi & Associates LLP, Chartered Accountants has confirmed that they are not disqualified from continuing as Auditors of the Company. The Auditors have also confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants ofIndia (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI.

The Auditors have issued an unmodified opinion on the Financial Statements for the financial year 2022-23 and the Auditorâs Report forms part of this Annual Report.

(ii) Secretarial Auditor

Further, in compliance of Regulation 24A of the Listing Regulations, Companyâs unlisted material subsidiaries also undergo Secretarial Audit and the Secretarial Audit Reports of the Company and its unlisted material subsidiaries thereto in the prescribed Form No. MR-3 is attached as Annexure-IV, IV(A) and IV(B) forming part of this Report. The same are also available on the website of the Company.

The Secretarial Audit Report of the Company and its unlisted material subsidiaries does not contain any qualification, reservation, adverse remark or disclaimer.

disclosures in terms of the provisions of the act & the listing regulations

A. Board of Directors (âBoardâ)

(i) Number of meetings

The Board met 9 (Nine) times during the year under review. The details of such meetings are disclosed in the Corporate Governance Report forming part of this Annual Report.

The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Act.

(ii) Director retiring by rotation

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Milan Khakhar, Non-Executive Director and Ms. Adwaita Nayar, Executive Director, are due to retire by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. The Board of Directors on the recommendation of the Nomination and Remuneration Committee (âNRCâ) has recommended their re-appointment.

Resolution seeking their re-appointment along-with their profile as required under Regulation 36(3) of the Listing Regulations forms part of the Notice of Eleventh Annual General Meeting.

(iii) Board evaluation

In sync with Nykaa value of âBe Better Everydayâ, the Nomination and Remuneration Committee / Board of Directors reviewed the Board evaluation framework and process for the financial year 20222023 to further strengthen the criteria, parameters and sharpness of rating/feedback for Board, its Committees & individual Board Members.

Pursuant to applicable provisions of the Act and the Listing Regulations, the Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors. The framework is monitored, reviewed and updated by the Board, in consultation with the Nomination and Remuneration Committee, in accordance with the new compliance requirements.

The annual performance evaluation of the Board, its Committees and each Director has been carried out for the financial year 2022-23 in accordance with the framework. The details of evaluation process of the Board, its Committees and Individual Directors, including Independent Directors have been provided under the Corporate Governance Report which forms part of this Report.

The Policy on Board ofDirectorsâ Evaluation Framework can be accessed at: https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/10-11/ Board-of-Directors-Evaluation-Framework.pdf

(iv) Declaration of independence

The Company has received necessary declaration from each Independent Director ofthe Company stating that:

(i) they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations; and

(ii) as required vide Rule 6 (1) & (2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 they have registered their names in the Independent Directorsâ Databank maintained by the Indian Institute of Corporate Affairs.

Based on the declarations received from the Directors, the Board confirms, that the Independent Directors fulfil the conditions as specified under Schedule V of the Listing Regulations and are independent of the management.

(v) Familiarisation programme for Independent Directors

Disclosure pertaining to familiarisation programme for Independent Directors is provided in the Corporate Governance Report forming part ofthis Annual Report.

B. Committees of the Board

The Board has constituted five committees which are mandated by the Act and the Listing Regulations, viz. Audit Committee, Nomination and Remuneration Committee, Stakeholdersâ Relationship Committee, Risk Management Committee and Corporate Social Responsibility & Environmental, Social, and Governance Committee. In addition to the said committees, the Board has also constituted Fundraise and Investment Committee.

Details of all the committees, along with their charters, composition and meetings held during the year, are provided in the Corporate Governance Report forming part of this Annual Report.

C. Key Managerial Personnel

In accordance with the provisions of Sections 2(51) and 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are the Key Managerial Personnel of the Company:

(a) Ms. Falguni Nayar - Executive Chairperson, Managing Director and Chief Executive Officer;

(b) Mr. P. Ganesh - Chief Financial Officer (appointed w.e.f. February 03, 2023); and

(c) Mr. Sujeet Jain - Chief Legal and Regulatory Officer, Company Secretary and Compliance Officer (appointed w.e.f. February 14, 2023).

Mr. Arvind Agarwal resigned as the Chief Financial Officer with effect from close of business hours on November 25, 2022 and Mr. Rajendra Punde resigned from the position of Company Secretary and Compliance Officer with effect from close of business hours on February 13, 2023. The Board places on record its appreciation towards their valuable contribution and guidance during their respective tenure.

D. Remuneration of Directors and Employees

Disclosure comprising particulars with respect to the remuneration of directors and employees and other details, as required to be disclosed in terms of the provisions of Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure-V to this Report.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of this Report.

Having regard to the provisions of the second proviso to Section 136(1) ofthe Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such information may write to the Company Secretary or e-mail at [email protected].

Your Company has adopted âRemuneration Policy for Directors, Key Managerial Personnel and other Employeesâ which sets out criteria for the remuneration for Directors, Key Managerial Personal (âKMPâ) which can be accessed at: https://www.nykaa.com/ media/wysiwyg/2021/Investors-Relations/pdfs/10-11/Remuneration-Policy-for-Directors-KMP-and-

other-employees.pdf

E. Vigil Mechanism/Whistle-Blower

Your Company believes in conduct of the affairs of its business in a fair and transparent manner by adopting highest standards of honesty, integrity, professionalism, and ethical behavior. Your Company has established a Vigil Mechanism/Whistle-Blower Policy (âPolicyâ) in accordance with the provisions of the Companies Act, 2013 and the Listing Regulations with a view to provide a platform and mechanism for Employees, Directors and other stakeholders of the Company to report actual or suspected unethical behaviour, fraud or violation of the Companyâs Code of Conduct, ethics, principles and matters specified in the policy without any fear of retaliation, and also provide for direct access to the Chairperson of the Audit Committee as the case may be, in exceptional cases.

Employees and other stakeholders are encouraged to report actual or suspected concerns or violations of applicable laws and regulations and the Code of Conduct. Such genuine concerns or violations are called âProtected Disclosuresâ which can be raised by a Whistle-Blower to âSpeak-up Helplineâ (an external independent agency or agencies appointed by the Company to receive and attend to the Protected Disclosures through toll-free number / e-mail / web portal), established in terms of the Policy.

The Company affirms that in compliance with the Whistle-Blower Policy/Vigil Mechanism no personnel had been denied access to the Audit Committee. The policy is available on the Companyâs website and can be accessed at: https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/10-11/ Whistle-Blower-Vigil-Mechanism-Policy 2023.pdf

F. Corporate Social Responsibility (âCSRâ)

At Nykaa, our vision is to bring inspiration and joy to people everywhere, everyday. This commitment, strengthened by our Mission and six core Values, forms the DNA of our CSR agenda. From our founding days, giving back has been part of ourjourney. Over the years we have made strong strides with consistent efforts and a focus on vulnerable communities, especially underprivileged women and children. We aim to be an ally that inspires positive change in people and their communities as we believe this will go a long way in building a more inclusive India.

The Company through its CSR programme aims to be a champion of authentic self-expression and meaningfully impact communities. Driving Empowerment and Inclusion for all forms the crux of our CSR philosophy, including the communities our business operates in, the socially and economically marginalised, as well as the society at large. By laying a CSR foundation that seamlessly aligns with its social voice and business behaviour, the company ensures its efforts towards programmes that are meaningful, scalable, sustainable and timeless.

While the Ministry of Corporate Affairs has spelt out the CSR activities under Schedule VII to the Companies Act, 2013 (âthe Actâ), in order to build focus and have a more impactful execution - with a view to make a difference - Companyâs focus areas for CSR are as follows:

â¢ Upliftment and mentoring of vulnerable age groups

â¢ Education, skilling & entrepreneurship

â¢ Access to healthcare

â¢ Sustainability and environmental responsibility

Over and above these, from time to time, on need and criticality basis the Company will review additional CSR activities which are prescribed under Schedule VII of the Act, such as:

â¢ Contribution to Governmentâs various relief funds

â¢ Support armed forces welfare

â¢ Support to research & technology

â¢ Protection of national heritage

â¢ Promote sports

The Company has in place a CSR policy in line with Section 135 read with Schedule VII of the Act. The objective of CSR policy of the Company is to lay down the guidelines and mechanism to carry out CSR projects/programmes by the Company and to report its CSR efforts in the format provided by the rules under the Act.

During the year under review, Nykaa Foundation was incorporated under the provisions of Section 8 of the Act to achieve CSR objectives of the Company and / or its subsidiaries. Nykaa Foundation is involved in undertaking CSR activities, on behalf of the Company or any other company / entity as may be legally permissible from time to time. Through Nykaa Foundation, the Company along with its subsidiaries namely, Nykaa E-Retail and Nykaa-KK Beauty has undertaken the following CSR projects in FY 2022-23:

(a) Project Labour Net (Sambhav Foundation):

Project Labour Net is an effort towards bringing more young women into the mainstream workforce by making them skilled beauty professionals. These young women, hailing from low-income communities have the ambition to become independent and contributing members of society but at times lack the right opportunities to do so. With two centres in Bengaluru and Guwahati each fully equipped with beauty stations for practical sessions, this project is providing months-long beginners training and internship to women who will then go on to work at beauty salons in local neighbourhoods, unlocking a new career for more than 400 women to explore and grow into.

(b) Nykaa Chair in Consumer Technology implemented by IIM-A: Nykaa has joined hands with IIM-A Endowment Fund to set up the Nykaa Chair in Consumer Technology. This three-year program has its focus on research and education to promote the scientific practice of marketing, and present insights on the impact of digital, social, and mobile technologies on business models, customer behaviour, and social changes at large facilitate incorporation of AI and machine learning insights in a disrupted marketplace. The chair also looks at deploying economic and statistical models to measure the role of the Internet and new media on consumer and firm behaviour besides understanding the privacypreserving future of digital advertising.

(c) Rangeet (Adiwasi Sewa Sanstha): In partnering with an innovative impact-led organization like Rangeet, Nykaa attempted to teach children aged 7-16 a holistic approach to looking at the world around us through a mobile app featuring a play-based Social, Emotional and Ecological Knowledge (SEEK) curriculum, with the aim to help children become better learners and support their wellbeing, agency and global stewardship. The app bolsters existing academic curricula and acts as a bridge towards achieving government education objectives of holistic learning.

(d) Slum Soccer - Krida Vikas Sanstha: Nykaa supported Krida Vikas Sansthaâs (Slum Soccer) to help 50 at-risk underprivileged youth to represent India at 20^th Edition of the H omeless World Cup in Sacramento, USA 2023. The 50 players/ youth are the potential game changers who come from slum/impoverished communities from different states - Jharkhand, Delhi, Maharashtra, Karnataka, Tamil Nadu, Chhattisgarh, Gujarat to name a few. While 18 of them are representing the India squad, all the players/youth had undergone two specially designed training programs aimed to equip them with skills, knowledge, mindset and confidence, determination and motivation to bring a sustainable change in the community by using the power of football.

(e) Anushkaa Foundation (for eliminating Club Foot): Aligning with âRashtriya Bal Swasthya Karyakramâ (RBSK), an important initiative âaiming at early identification and intervention for children from birth to 18 years to cover 4 âDâs viz., Defects at birth, Deficiencies, Diseases, Development delays including disabilityâ. Anushkaa Foundation for Eliminating Clubfoot (AFEC) in 100 children across India in 2023 focuses on skilling doctors and developing them as Ponseti Method Trained Practitioners, Medical Trainers and providing Supportive Supervision. The Ponseti Method is an effective, inexpensive, minimally invasive form of treatment, well suited

to low resource settings. It is considered as the gold standard treatment for clubfoot.

(f) Indian Deaf Cricket Association: Support by way of sponsorship to the âIndian Deaf Cricket Associationâ (IDCA) for Womenâs 4^th T-10 National Cricket Championship for Deaf. Indian Deaf Cricket Association (IDCA) continuously works on development, training, and promotion of Differently Abled Cricket especially Deaf Cricket in the country and has a strong network of 20 State Deaf Cricket Associations. Through this endowment, we intended to provide a unique opportunity for talent from underprivileged backgrounds to excel in the field of disability sport.

A brief outline of the CSR Philosophy, salient features of the CSR Policy of the Company, the CSR initiatives undertaken during the financial year 2022-23 together with progress thereon and the report on CSR activities in the prescribed format, as required under Section 134(3)(o) read with Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure-VI to this Report and the CSR Policy can be accessed using the link https://www.nykaa.com/media/wysiwyg/2021/ Investors-Relations/pdfs/10-11/CSR-Policy.pdf.

G. Employee Stock Option Scheme and Share Based Employee Benefits

Your Company grants employee stock options that would enable the employees to share the value they create for the Company in the years to come. Accordingly, pursuant to the approval of Board and shareholders of the Company and in terms of the provisions of applicable laws, your Company has instituted Employees Stock Options Scheme - 2012 (âESOS 2012â) and FSN Employees Stock Scheme - 2017 (âESOS 2017â) for grant of stock options to eligible employees.

Further, during the year under review, based upon the recommendation of the Nomination and Remuneration Committee, the Board of Directors on October 03, 2022 and the Shareholders of the Company vide special resolutions passed through postal ballot on November 02, 2022, had approved the implementation of âFSN E-Commerce Ventures Limited - Employee Stock Option Plan 2022â (âESOP 2022â) and FSN E-Commerce Ventures Limited -Employee Stock Unit Plan 2022 (âStock Unit Plan 2022â) to motivate, incentivize, and reward the eligible employees of the Company and its Subsidiaries.

Consequently, as on the date of this report, your Company has four operative schemes / plan, namely,

ESOS 2012, ESOS 2017, ESOP 2022 and Stock Option Plan 2022 (collectively referred to as âESOP & RSU Schemesâ).

The Nomination and Remuneration Committee of the Board of Directors of the Company, inter alia,

administers and monitors the ESOS & RSU Schemes, in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (âSEBI SBEB Regulationsâ). During the year under review, there is no material change in the ESOS & RSU Schemes, and they are in compliance with the provisions of SEBI SBEB Regulations and other applicable provisions of law.

During the financial year 2022-23, 42,000 Stock Options under ESOS 2012, 31,47,100 Stock Options under ESOS 2017 and 7,60,000 Stock Options under ESOP 2022 were issued to eligible employees. As on March 31, 2023, 660 Stock Options under ESOS 2012, 32,900 Stock Options under ESOS 2017 and 88,40,000 Stock Options under ESOP 2022 and 24,00,000 Stock Units under Stock Unit Plan 2022 are outstanding.

H. Investor Education and Protection Fund (âIEPFâ)

âTransfer of unclaimed/unpaid amount to the Investor Education and Provident Fundâ has been covered in the Corporate Governance Report forming of the Annual Report.

I. Related Party Transactions

Form No. AOC-2 in terms of Section 134(3) (h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. Accordingly, there are no transactions that are required to be reported in Form AOC-2.

The Companyâs Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions is available on the website of the Company at https://www.nykaa.com/media/wysiwyg/2021/

I nvestors-Relations/pdfs/10-11/Related-Party-Transaction- Policy.pdf.

The details of the related party transactions as per Indian Accounting Standards (IND AS) - 24 are set out in Note 44 to the Standalone Financial Statement of the Company. The Company in terms of Regulation 23 of the Listing Regulations submits within the stipulated time from the date of publication of its standalone and consolidated financial results for the half year, disclosures of related party transactions on a consolidated basis, in the specified format to the stock exchanges. The said disclosures can be accessed on the website of the Company at https://www.nykaa.com/ stock-exchange-fi lings.

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

The foreign exchange earnings and outgo are as below:

Particulars	2022-23	2021-22
Earnings in Foreign Exchange	Nil	H 15.69 million
Expenditure in Foreign Exchange	H 139.63 million	H 271.66 million

The key internal financial controls have been documented, automated wherever possible and embedded in the respective business processes. Assurance to the Board on the effectiveness of internal financial controls is obtained through 3 Lines of Defence which include:

(a) Management reviews and self-assessment;

(b) Continuous controls monitoring by functional experts; and

The Company believes that these systems provide reasonable assurance that the Companyâs internal financial controls are adequate and are operating effectively as intended. During the year under review, such controls were tested by the Statutory Auditors of the Company and no material weaknesses or significant deficiencies in the design or operations were observed and reported by the Statutory Auditors. Details of the internal controls system are provided in the Management Discussion & Analysis Report.

M. Policy on Directorsâ Appointment and Remuneration

In terms of Section 178 of the Act and Regulation 19 of the Listing Regulations, the Board of your Company, on recommendation of the Nomination and Remuneration Committee (âNRCâ), had adopted a âRemuneration Policy for Directors, Key Managerial Personal (âKMPâ) and other employeesâ (âRemuneration Policyâ) and âPolicy on Board Diversityâ.

The Companyâs Remuneration Policy is directed towards designing remuneration so as to attract, retain, and reward talent who will contribute to longterm success of the Company and build value for its shareholders. Objective of Board Diversity Policy is to ensure that the Board is fully diversified and comprises of an ideal combination of Executive and Non-Executive Directors, including Independent Directors, with diverse backgrounds.

The salient features of the policies are outlined in the Corporate Governance Report and the policies are made available on the Companyâs website, which can be accessed using the link https://www. nykaa.com/policies.

K. Risk Management

Risk Management is integral to your Companyâs strategy and for the achievement of our long-term strategic goals. Our success as an organisation depends on our ability to identify and leverage the opportunities while managing the risks.

At Nykaa, while we scan the business horizon to evaluate potential business opportunities, we also continuously monitor the internal and external environment to identify, assess and mitigate potential and emerging risks that may adversely harm or threaten the achievement of our strategic objectives.

Your Company has a risk management framework that supports decision making across various levels across the enterprise while being designed to proactively identify, assess and mitigate risks.

These levels form the strategic defence cover of your Companyâs risk management with an organisational structure for managing and reporting on risks. Furthermore, the Enterprise Risk Management (âERMâ) Governance Structure of your Company identifies the key internal stakeholders responsible for creating, implementing and sustaining ERM in the organisation.

The Board, through a dedicated Risk Management Committee (RMC), provides an effective oversight of the ERM framework including the processes for the identification, evaluation and management of material risks including emerging risks, and regularly reviews the effectiveness of risk treatment or mitigation actions implemented to reduce the exposure as also the quantum of residual risk to ensure it is within the overall risk appetite of the enterprise.

Our approach to risk management is designed to provide reasonable assurance that our assets are safeguarded, the risks facing the business are being assessed and mitigated and all information that may be required to be disclosed is reported to Companyâs Senior Management, the Audit Committee, the Risk Management Committee and the Board.

L. Internal Financial Control

According to Section 134(5)(e) of the Act the term Internal Financial Control (IFC) means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Act also mandate the need for an effective Internal Financial Control system in the Company which should be adequate and shall operate effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Boardâs report.

N. Particulars of Loans, Guarantees and Investments

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

In compliance with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made thereunder, your Company has adopted a Prevention of Sexual Harassment Policy for the prevention of sexual harassment and constituted Internal Complaints Committee (ICC) to deal with complaints relating to sexual harassment at workplace. For details, kindly refer to relevant disclosures in the Corporate Governance Report which forms part of the Annual Report 2022-23.

P. Environment & Safety

Your Company is conscious of the importance of environmentally clean and safe operations and has framed and adopted Health, Safety and Environment (HSE) Policy which can be accessed at https://www. nykaa.com/media/wysiwyg/2021/Investors-Relations/ pdfs/10-11/Nykaa-Health-Safety-and-Environment-Policy.pdf. The Companyâs policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

Your Company is committed to the highest standards of health, safety and environment practices within the organisation and the extended areas within our influence, with an aim to provide safe and healthy working environment to our employees, customers, business partners, suppliers and visitors.

During the year under review, the Company continued its waste management efforts through various environment friendly measures i.e., use of eco-friendly packaging material, recycling of plastic waste and redesigning packaging to reduce plastic waste. Scrap disposal is in line with industry benchmarks.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions/events on these items during the year under review:

â¢ There was no change in the nature of business of your Company as stipulated under sub-rule 5(ii) of Rule 8 of Companies (Accounts) Rules, 2014.

â¢ No significant or material orders were passed by the Regulators or Courts or Tribunals, which impact the going concern status and Companyâs operations in future.

â¢ Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except Employeesâ Stock Options Schemes and Bonus Issue referred to in this Report.

â¢ No fraud has been reported by the Auditors to the Audit Committee or the Board.

â¢ There is no application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the FY 2022-23.

â¢ The Company has not made any one-time settlement for the loans taken from the Banks or Financial Institutions, therefore, the same is not applicable.

â¢ Your Company has not issued Equity Shares with differential rights as to dividend, voting or otherwise; and

â¢ Your Company has not raised funds through preferential allotment or qualified institutions placement as per Regulation 32(7A) of the Listing Regulations.

SECRETARIAL STANDARDS

During the year under review, your Company has complied

with the Secretarial Standards 1 and 2 on meetings of the

Board of Directors and on General Meetings, respectively,

issued by the Institute of Company Secretaries of India and

notified by the Ministry of Corporate Affairs, in terms of Section 118(10) of the Act.

MAINTENANCE OF COST RECORDS

Your Company is not engaged in the business of production of goods or providing of services as specified in Rule 3 of the Companies (Cost Records and Audit) Rules, 2014 (âRulesâ). Accordingly, the requirement of maintaining cost records in accordance with Section 148(1) of the Act read with the Rules is not applicable to the Company for the period under review.

ACKNOWLEDGEMENT

The Board wishes to place on record its appreciation for the assistance, co-operation and encouragement extended to the Company by the Companyâs customers, business partners, brands, bankers and other stakeholders.

The Directors take this opportunity to place on record their warm appreciation for the valuable contribution, untiring efforts and spirit of dedication demonstrated by the employees and officers at all levels, in ensuring an excellent all-around operational performance. We applaud them for their superior levels of competence, solidarity, and commitment to the Company. The Directors would also like to thank the shareholders for their wholehearted support and contribution. We look forward to their continued support in future.

For and on behalf of the Board of Directors

Falguni Nayar

Executive Chairperson, Managing Director & CEO

DIN:- 00003633

Place: Mumbai Date: May 24, 2023

Mar 31, 2022

Your Board of Directors (âBoardâ) present the Tenth (10^th) Annual Report of FSN E-Commerce Ventures Limited (âyour Companyâ or âthe Companyâ) together with the Audited Financial Statements of the Company, for the financial year ended March 31, 2022 (âthe year under reviewâ or âthe yearâ or âFY 2021-22â).

Financial Performance - An Overview

('' in Million)
Particulars	Stand	alone	Conso	lidated
Particulars	March 31, 2022	March 31, 2021	March 31, 2022	March 31, 2021
Revenue from Operations	1,876.99	1,458.13	37,739.35	24,408.95
Other Income	1,157.07	602.50	269.72	117.59
Total Income	3,034.06	2,060.63	38,009.07	24,526.54
Total Expenditure	1,817.14	1,612.37	37,536.01	23,865.30
Profit/(Loss) before Tax	1,216.92	448.26	473.06	661.24
Current Tax	43.91	-	422.93	400.78
Deferred Tax Expenses/(Credit)	137.88	86.38	(362.75)	(356.02)
Profit/(Loss) after Tax	1,035.13	361.88	412.88	616.48
Other Comprehensive Income (OCI)	(19.06)	(20.37)	5.56	(21.81)
Total Comprehensive Income	1,016.07	341.51	418.44	594.67
Balance in the Profit/(Loss) Account in the Balance Sheet	751.29	(283.84)	(581.50)	(992.25)

REVIEW OF OPERATIONS

In FY 2021-22, your Company reported a revenue of '' 1,876.99 million which was '' 418.86 million higher than the previous year and EBITDA of '' 165.56 million with EBITDA margin at 8.82 % (previous year ''(28.76) million with EBITDA margin at (1.97)%).

At consolidated level, your Company reported a revenue of '' 37,739.35 million (previous year '' 24,408.95 million) and EBITDA of '' 1,632.58 million with EBITDA margin at 4.33% (previous year '' 1,566.55 million with EBITDA margin at 6.42%).

The operating and financial performance of your Company has been covered in the Management Discussion and Analysis Report which forms part of the Annual Report.

DETAILS OF MATERIAL CHANGES AND COMMITMENTS FROM THE END OF THE FINANCIAL YEAR

There are no material changes and commitments affecting the financial position of your Company, which have occurred between the end of the FY 2021-22 and the date of this report. Further, there has been no change in the nature of business of your Company.

RESERVES

There is no amount proposed to be transferred to the Reserves.

DIVIDEND

Your Board do not recommend any Dividend on the Equity Shares of the Company for Financial Year ended March 31, 2022 considering that the company is in growth stage and require funds to support its growth objectives.

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), your Company has formulated a Dividend Distribution Policy, with an objective to provide the dividend distribution framework to the Stakeholders of the Company. The policy sets out various internal and external factors, which shall be considered by the Board in determining the dividend pay-out. The policy is annexed as Annexure - I to this Report and is also available on the website of the Company at https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/10-11/Dividend-Distribution-Policy.pdf.

STRATEGIC INITIATIVES DURING THE YEAR UNDER REVIEW AND TILL THE DATE OF THIS REPORTA. INITIAL PUBLIC OFFERING & LISTING OF EQUITY SHARES OF THE COMPANY

During the year under review, your Company made an Initial Public Offering (âIPOâ or âIssueâ) of 47,575,326 equity shares of face value of '' 1 each of the Company for cash at a price of ''1,125 per equity share, including a premium of '' 1,124 per equity share aggregating to ''53,497.24 million, comprising of a fresh issue of 5,602,666 equity shares aggregating to '' 6,300 million and an offer for sale of 41,972,660 equity shares aggregating up to '' 47,197.24 million by the selling shareholders. The issue included a reservation of 250,000 equity shares for purchase by eligible employees.

The issue opened on October 28, 2021 and closed on November 02, 2021. The issue was led by book running Lead Managers viz. Kotak Mahindra Capital Company Limited, Morgan Stanley Investment Management Private Limited, BofA Securities

India Limited, Citigroup Global Markets India Private Limited, ICICI Securities Limited and JM Finance Limited.

The issue drew bids worth $32.5 billion and was oversubscribed around 82 times (i.e., around 12 times in Retail Individual Investor (âR11â), 91 times in the Qualified Institutional Buyer (âQIBâ) and 112 times in the Non-Institutional Investor (âNIIâ) category). The Company successfully completed the IPO process and the equity shares of the Company were listed on National Stock Exchange of India Limited and BSE Limited on November 10, 2021.

Proceeds from Initial Public Offering

The details of the proceeds of the Fresh Issue are set forth below:

B. SHARE CAPITAL

Details of changes in paid-up equity share capital during the year under review, are as under:

	Paid-up Equity Share Capital	'' in Million
Pre-Split
A	At the beginning of the year, i.e. as on April 01, 2021	150.57
B	Allotments made pursuant to:
	Employee Stock Option Scheme 2012	0.17
	Employee Stock Option Scheme 2017	0.43
	Issue of Equity Shares upon conversion of Optionally Convertible Redeemable Preference Shares (OCRPS)	4.51
C	Sub-Total of C (A B)	155.68
Post-Split*
D	Allotments made pursuant to:
	Issue of bonus shares in the ratio 2:1	311.36
	Issue of shares in Initial Public Offering	5.60
	Employee Stock Option Scheme 2012	0.01
	Employee Stock Option Scheme 2017	1.46
	Sub-Total of D	318.43
	At the end of the year, i.e. as on March 31, 2022 (C D)	474.11

* Pursuant to board resolution dated July 15, 2021 and shareholdersâ resolution dated July 16, 2021, equity shares of face value of '' 10 each of the Company were sub-divided into equity shares of face value of '' 1 each.

Particulars	Amount
Gross Proceeds of the Fresh Issue	'' 6,300 million
(Less) Net of provisional IPO Expenses	'' 290.49 million
Net Proceeds '' 6009.51 million

The utilisation of funds raised through IPO have been mentioned hereunder:

Mode	Object	Amount Allocated	Amount Utilised as on March 31, 2022
IPO	Investment in certain Subsidiaries for setting up of retail stores	'' 420 million	'' 4.20 million
	Capital expenditure and Investment in certain Subsidiaries for setting up of warehouses	'' 420 million	'' 13.47 million
	Repayment of certain borrowings of the Company	'' 1,560 million	'' 1,560 million
	Acquire and retain customers by enhancing the visibility and awareness of our brands	'' 2,340 million	'' 369.52 million
	General Corporate Purposes	'' 1,269.51 million	'' 401.05 million
	Net Proceeds	'' 6,009.51 million	'' 2,348.24 million

C. ACQUISITION OF 51% STAKE IN DOT & KEY WELLNESS PRIVATE LIMITED

On September 28, 2021, your Company acquired 51% of the outstanding equity shares of Dot & Key Wellness Private Limited (âDot & Keyâ) through the subscription and purchase of equity shares. Pursuant to the shareholderâs agreement, the Company has written put option on the balance 49% of the equity share capital. The put option liability will be settled for a consideration not exceeding '' 1,530 million for stake upto 49%. Dot & Key is engaged in the business of manufacturing, marketing, branding and sale of skincare and personal care products, including serums, toners, cleansers, face masks and face creams. Dot & Key has also launched few products in the nutraceuticals category. Its products are listed on Companyâs and other online retailersâ platforms as well as in physical retail stores. Following this investment, Dot & Key became one of Companyâs owned brands and this investment will allow the Company to expand its skincare, personal care and nutraceuticals offerings.

D. ACQUISITION OF 18.51% STAKE IN EARTH RHYTHM PRIVATE LIMITED

Your Board at its meeting held on April 22, 2022 had approved entering into Share Subscription Agreement, Share Purchase Agreement and Shareholdersâ Agreement by the Company to acquire by way of subscription and/or purchase of Compulsory Convertible Cumulative Preference Shares and/ or Equity shares, up to 18.51 % of the fully diluted

Your Company has appointed ICICI Bank Limited as Monitoring Agency in terms of Regulation 41 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 (âICDR Regulationsâ), as amended from time to time, to monitor the utilisation of IPO proceeds and the Company has obtained monitoring reports from the Monitoring Agency from time to time confirming no deviation or variation in the utilisation of proceeds of the IPO from the objects stated in the Prospectus dated November 02, 2021. The Company has submitted the statement(s) and report as required under Regulation 32 of the Listing Regulations to both the exchanges where the shares of the Company are listed, namely, National Stock Exchange of India Limited and BSE Limited and on timely basis.

Your Directors would like to thank the merchant bankers - Kotak Mahindra Capital Company Limited, Morgan Stanley India Company Private Limited, BofA Securities India Limited, Citigroup Global Markets India Private Limited, ICICI Securities Limited and JM Financial Limited and legal counsels involved with the IPO - AZB & Partners, Cyril Amarchand Mangaldas, Sidley Austin LLP and Trilegal for helping the Company achieving successful IPO and listing.

Your Directors would also like to thank the regulators SEBI and ROC for enabling the Company to take its equity story to the public market.

Last but not the least, your Directors extend their heartfelt gratitude to the shareholders for investing in the IPO and reposing their continuous trust and faith in the Company & its management.

share capital of Earth Rhythm Private Limited (Earth Rhythm), for a consideration of up to '' 416.5 million.

Your Company continues to partner with homegrown D2C brands. Earth Rhythm was incorporated on October 12, 2020 under the Companies Act, 2013 in India. It is a personal care brand which manufactures and sells sustainable/non-toxic beauty products on their website and other e-commerce websites. This investment will further strengthen your Companyâs product portfolio into sustainable beauty segment and its positioning in the growing market for products that are committed to efficacy as well as the planet.

E. ACQUISITION OF 60% STAKE IN NUDGE WELLNESS PRIVATE LIMITED

On April 22, 2022, your Board approved entering into Share Subscription and Shareholderâs Agreement and Share Purchase Agreement by the Company to acquire by way of subscription and/or purchase of Equity shares, initially up to 60% (with a right to go up to 100%) of the fully diluted share capital of Nudge Wellness Private Limited (âNudgeâ) for a consideration of up to '' 36 million.

Nudge, incorporated under the Companies Act, 2013 on March 10, 2022, is a nutricosmetics wellness company which will be in the business of manufacturing and selling dietary supplement products on their website and other e-commerce websites. The investment will mark Companyâs entry into owned brand of dietary supplement and other nutricosmetics products. This will address the growing

demand for high-potential category of edible beauty in India.

F. ACQUISITION OF THE BRAND âKICAâ

On April 22, 2022, your Board approved entering into definitive agreements/documents by Nykaa Fashion Private Limited (a wholly-owned subsidiary of the Company) for acquisition of the brand âKICAâ including Brand Trademark, other Intellectual Property Rights etc. for a consideration of up to '' 45.1 million.

KICA is an activewear athleisure brand which offers stylish, high-quality garments (tops, shorts, sports bra, legging, tracks, etc.) on their website and other e-commerce websites. The transaction will be in the direction of Nykaa Fashion Private Limitedâs mission to strengthen its active-wear play providing greater variety and curation for the growing active-wear community of athletes and everyday fitness seekers. This transaction will also augment current offerings under the Companyâs brand âNykdâ.

Pursuant to the approval of the Board, the Company and Nykaa Fashion Private Limited have finalised and executed the relevant agreements for the proposed transactions mentioned in above points (D) to (F) which are subject to fulfilment of various terms and conditions as specified in the relevant agreements and statutory approvals, if any.

SUBSIDIARIES AND JOINT VENTURE

As on March 31, 2022, the Company has seven subsidiaries. Following were the additions during the year under review:

(i) FSN Distribution Private Limited became a Wholly Owned Subsidiary of the Company w.e.f. July 30, 2021; and

(ii) Dot & Key Wellness Private Limited became Subsidiary of the Company w.e.f. September 28, 2021.

The details of business carried on by the subsidiaries of the Company are as follows:

Nykaa E-Retail Private Limited (âNykaa E-Retailâ)

Nykaa Fashion Private Limited (âNykaa Fashionâ) was

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (âActâ) read with the Companies (Accounts) Rules, 2014 and in accordance with applicable accounting standards, a statement containing the salient features of financial statements of your Companyâs subsidiaries in Form No. AOC-1 is annexed as Annexure - II to this Report.

Your Company has formulated a Policy for determining Material Subsidiaries. The said policy is available on the website of the Company at https://www.nykaa.com/ media/wysiwyg/2021/Investors-Relations/pdfs/10-11/ Policy-for-determining-Material-Subsidiary.pdf. During the year under review Nykaa E-Retail and FSN Brands were material subsidiaries of the Company, as per the Listing Regulations.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under the Listing Regulations, is presented in a separate section, forming part of the Annual Report.

BUSINESS RESPONSIBILITY REPORT (BRR)

Your Company believes that transparent, accurate and comprehensive disclosure practices not only aid in strategic decision-making but also help in demonstrating incremental value created for all groups of stakeholders.

The Business Responsibility Report for the year under review, as stipulated under Regulation 34(2)(f) of the Listing Regulations, describing the initiatives taken by your Company from social and governance perspective, forms an integral part of the Annual Report.

STANDALONE AND CONSOLIDATED FINANCIAL STATEMENTS

The audited financial statements of the Company are drawn up, both on standalone and consolidated basis, for the financial year ended March 31, 2022, in accordance with the requirements of the Companies (Indian Accounting Standards) Rules, 2015 (Ind-AS) notified under Section 133 of the Act, read with relevant Rules and other accounting principles. The Consolidated Financial Statement has been prepared based on the financial statements received from subsidiaries, as approved by their respective Board of Directors.

websites, other online applications and retail outlets, general trade and modern trade.

FSN Brands Marketing Private Limited (âFSN Brandsâ)

FSN International Private Limited (âFSN Internationalâ)

FSN International Private Limited has two wholly owned subsidiaries namely, FSN Global FZE, Dubai and Nykaa International UK Limited, United Kingdom (UK).

i. FSN Global FZE (âFSN Globalâ) was incorporated on June 21, 2020 and is engaged in the business of sale of cosmetics, beauty, personal care, skin care, hair care, beauty and personal care products and equipment through marketplace model.

ii. Nykaa International UK Limited (âNykaa Internationalâ) was incorporated on November 15, 2020 to engage in the business of sale of cosmetics, beauty, personal care, skin care and hair care products in UK. Nykaa International has not yet commenced its business operations, while it is in process of getting the products registered in UK.

FSN Distribution Private Limited (âFSN Distributionâ)

Nykaa-KK Beauty Private Limited (âNykaa-KK Beautyâ)

Dot & Key Wellness Private Limited (âDot & Keyâ) was

acquired on September 28, 2021 and your Company holds 51% shares in it. Dot & Key is engaged in the business of manufacturing, marketing, branding and sale of skincare and personal care products, including serums, toners, cleansers, face masks and face creams.

CORPORATE GOVERNANCE

M/s. S. N. Ananthasubramanian & Co., Company Secretaries, the Secretarial Auditor of the Company vide their certificate dated May 25, 2022, have confirmed that the Company is and has been compliant with the conditions stipulated in the chapter IV of the Listing Regulations. The said certificate is annexed as âAnnexure - IVâ to this Report.

ANNUAL RETURN

The Annual Return of the Company as on March 31, 2022 in Form MGT - 7 in accordance with Section 92(3) and Section 134(3)(a) of the Act as amended from time to time and the Companies (Management and Administration) Rules, 2014, will be made available on the website of the Company at https://www.nykaa.com/investor-relations.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Act, with respect to Directorsâ Responsibility Statement, the Directors of the Company confirm that:

(a) in the preparation of the annual accounts for the year ended March 31, 2022, the applicable accounting standards had been followed and there are no material departures from the same;

(b) the directors had selected such 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, 2022 and of the profits of the Company for the year ended on that date;

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

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

DISCLOSURES IN TERMS OF THE PROVISIONS OF THE ACT & THE LISTING REGULATIONS

A. Board of Directors (âBoardâ)

(i) Number of meetings

The Board met 18 times during the year under review. The details of such meetings are disclosed in the Corporate Governance Report forming part of this Annual Report.

The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Act.

(ii) Director retiring by rotation

In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Anchit Nayar, Executive Director and Mr. Sanjay Nayar, Non-Executive Director of the Company, are due to retire by rotation at the ensuing Annual General Meeting and being eligible, have offered themselves for re-appointment. The Board of Directors on the recommendation of the Nomination and Remuneration Committee (âNRCâ) has recommended their re-appointment.

Resolution seeking their re-appointment along-with their profile as required under Regulation 36(3) of Listing Regulations forms part of the Notice of Tenth Annual General Meeting.

(iii) Board evaluation

Pursuant to applicable provisions of the Act and the Listing Regulations, the Board, in consultation with its Nomination and Remuneration Committee, has formulated a framework containing, inter alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and individual directors, including Independent Directors. The framework is monitored, reviewed and updated by the Board, in consultation with the Nomination and Remuneration Committee, in accordance with the new compliance requirements.

The annual performance evaluation of the Board, its Committees and each Director has been carried out for the financial year 2021-22 in accordance with the framework. The details of evaluation process of the Board, its Committees and individual directors, including independent directors have been provided under the Corporate Governance Report which forms part of this Report.

The Policy on Board of Directorsâ Evaluation Framework can be accessed at: https://www.nykaa. com/media/wysiwyg/2021/Investors-Relations/ pdfs/10-11/Board-of-Directors-Evaluation-Framework.pdf

AUDITORS AND THEIR REPORT

(i) Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the Rules framed thereunder, M/s. V. C. Shah & Co., Chartered Accountants, Mumbai, were appointed as Statutory Auditors of the Company, for a term of five consecutive years to hold office from the conclusion General Meeting (âAGMâ) till the conclusion of 13^th AGM of the Company to be held for the FY 2024-25. Further, during the year under review, M/s. S. R. Batilboi & Associates LLP, Chartered Accountants were reappointed as Joint Statutory Auditors of the Company, for a term of five consecutive years to hold office from the conclusion of 9^th AGM of the Company held on September 29, 2021 till the conclusion of 14^th AGM to be held in the FY 2026-27.

Pursuant to Section 139 and 141 of the Act and relevant Rules prescribed thereunder, the Statutory Auditors have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Auditors have also confirmed that they have subjected themselves to the peer review process of Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI.

The Auditorsâ Report does not contain any qualification, reservation, adverse remark or disclaimer.

(ii) Secretarial Auditor

In terms of the provisions of Section 204 of the Act read with Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2014 and Regulation 24A of the SEBI LODR Regulations, your Company has appointed M/s. S. N. Ananthasubramanian & Co., Company Secretaries, as Secretarial Auditor to conduct Secretarial Audit of the Company for FY 21-22.

Further, in compliance of Regulation 24A of the Listing Regulations, Companyâs unlisted material subsidiaries also undergo Secretarial Audit and the Secretarial Audit Reports of the Company and its unlisted material subsidiaries thereto in the prescribed Form No. MR-3 is attached as Annexure - V, V(A) and V(B) forming part of this Report. The same are also available on the website of the Company.

The Secretarial Audit Report of your Company and its unlisted material subsidiaries does not contain any qualification, reservation, adverse remark or disclaimer.

(iv) Declaration of independence

The Company has received necessary declaration from each Independent Director of the Company stating that:

(i) they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations; and

(v) Familiarisation Programme for Independent Directors

Disclosure pertaining to familiarisation programme for Independent Directors is provided in the Corporate Governance Report forming part of this Annual Report.

B. Committees of the Board

i. Audit Committee

The Audit C ommittee comprises of Mr. Milind Sarwate - Independent Director (Chairperson), Ms. Anita Ramachandran -Independent Director, Ms. Alpana Parida -Independent Director, Mr. Seshashayee Sridhara - Independent Director, Mr. Milan Khakhar - NonExecutive Director and Mr. Anchit Nayar - Executive Director. Majority of the Members including the Chairperson of the Committee are Independent Directors and possess strong accounting and financial management knowledge. During the year under review, all the recommendations made by the Audit Committee were accepted by the Board.

ii. Nomination & Remuneration Committee

Nomination & Remuneration Committee comprises of Ms. Anita Ramachandran - Independent Director (Chairperson), Ms. Alpana Parida -Independent Director and Mr. Milan Khakhar - NonExecutive Director.

iii. Stakeholdersâ Relationship Committee

The Stakeholdersâ Relationship Committee comprises of Ms. Alpana Parida - Independent Director (Chairperson), Mr. Anchit Nayar - Executive Director and Ms. Adwaita Nayar - Executive Director.

iv. Risk Management Committee

The Risk Management Committee comprises of Mr. Sanjay Nayar - Non-Executive Director (Chairperson), Mr. Pradeep Parameswaran -Independent Director and Mr. Sanjay Suri - Chief Technology Officer.

v. Corporate Social Responsibility & Environmental, Social, and Governance Committee

The Corporate Social Responsibility & Environmental, Social, and Governance Committee comprises of Ms. Anita Ramachandran - Independent Director (Chairperson), Mr. Sanjay Nayar - Non-Executive Director and Ms. Adwaita Nayar - Executive Director.

Details of all the committees, along with their charters, composition and meetings held during the year, are provided in the Corporate Governance Report forming part of this Annual Report.

C. Key Managerial Personnel

In accordance with the provisions of Sections 2(51) and 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are the Key Managerial Personnel of the Company:

(i) Ms. Falguni Nayar - Executive Chairperson, Managing Director and Chief Executive Officer;

(ii) Mr. Arvind Agarwal - ChiefFinancial Officer; and

(iii) Mr. Rajendra Punde - Company Secretary and Compliance Officer

During the year under review, there has been no changes in the Key Managerial Personnel of the Company.

D. Remuneration of Directors and Employees

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, statement showing the names of the top ten employees in terms of remuneration drawn and names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules forms part of

K. Risk Management

Risk Management is integral to your Companyâs strategy and for the achievement of our long-term goals. Our success as an organisation depends on our ability to identify and leverage the opportunities while managing the risks.

Your Company has a risk management framework in place working at various levels across the enterprise designed to identify, assess and mitigate risks appropriately. These levels form the strategic defence cover of the Companyâs risk management with an organisational structure for managing and reporting on risks. Furthermore, the Enterprise Risk Management (âERMâ) Governance Structure of your Company identifies the key internal stakeholders responsible for creating, implementing and sustaining ERM in the organisation.

The Risk Management Committee of the Company has been entrusted by the Board with the responsibility of reviewing the risk management process in the Company and ensuring that the risks are brought within acceptable limits.

The Company endeavours to continually sharpen its Risk Management systems and processes in line with a rapidly changing business environment. There are no risks which in the opinion of the Board threaten the existence of the Company. Details of various risks faced by your Company are provided in the Management Discussion & Analysis Report.

Your Com pany has framed a nd implem ented a Risk Management Policy in terms of the provisions of Regulation 17 of the Listing Regulations, for the assessment and minimisation of risk, including

this Report.

Having regard to the provisions of the second proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such information may write to the Company Secretary or e-mail at nykaacompanysecretary@ nykaa.com.

Your Company has adopted Policy on Remuneration for Directors, Key Managerial Personnel and other Employees which sets out criteria for the remuneration for Directors, Key Managerial Personal (âKMPâ) which can be accessed at: https://www.nykaa.com/ media/wysiwyg/2021/Investors-Relations/pdfs/10-11/Remuneration-Policy-for-Directors-KMP-and-other-employees.pdf

E. Vigil Mechanism/Whistle-Blower

The Company has established a Vigil Mechanism/ Whistle-blower policy in accordance with the provisions of the Act and the Listing Regulations. Vigil Mechanism/Whistle blower policy has been formulated with a view to provide a mechanism for Employees, Directors and other stakeholders of the Company to approach the designated Ombudsperson and/or the Chairperson of the Audit Committee of the Company to report actual or suspected unethical behaviour, fraud or violation of the Companyâs Code of Conduct/ ethics/ principles and matters specified in the Policy.

Employees and other stakeholders are required to report actual or suspected violations of applicable laws and regulations and the Code of Conduct. Such genuine concerns disclosed as per Policy are called âProtected Disclosuresâ and can be raised by a Whistle-blower through an e-mail or a letter to the Ombudsperson/ Chairperson of the Audit Committee. The Company affirms that in compliance with the Whistle-Blower Policy/ Vigil Mechanism no personnel had been denied access to the Audit Committee. The Vigil Mechanism and Whistle-blower policy is available on the Companyâs website and can be accessed at: https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/10-11/ Vigil-Mechanism-Whistle-Blower- Policy.pdf

F. Corporate Social Responsibility (âCSRâ)

The Company has in place a CSR policy in line with Section 135 read with Section VII of the Act. As per the CSR policy of the Company Upliftment and Mentoring across age groups Education, Skilling & Entrepreneurship, Access to healthcare, Sustainability and environmental responsibility are the focus areas for CSR engagement. Over and above these, from time to time, on a need and criticality basis your Company undertakes / will undertake CSR activities which are prescribed under Schedule VII of the Act.

A brief outline of the CSR Philosophy, salient features of the CSR Policy of the Company, the CSR initiatives undertaken during the financial year 2021-22 together with progress thereon and the report on CSR activities in the prescribed format, as required under Section 134(3)(o) read with Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure - VII to this Report and the CSR Policy can be accessed using the link https://www.nykaa.com/media/wysiwyg/2021/ Investors-Relations/pdfs/10-11/CSR-Policy.pdf.

G. Employee stock option scheme (âESOSâ)

Your Company grants Employee stock options that would enable the employees to share the value they create for the Company in the years to come. Accordingly, pursuant to the approval of the Board and the members of the Company and in terms of the provisions of applicable laws, your Company has duly implemented the:

a) Employee Stock Option Scheme -2012 (âESOS 2012â)

b) FSN Employees Stock Option Scheme 2017 (âESOS 2017â)

Collectively referred as âESOS 2012 & 2017 Schemeâ or âESOP Schemesâ

The Nomination and Remuneration Committee is entrusted with the responsibility of administering the ESOS 2012 & 2017 Scheme.

During the financial year 2021-22, 1,74,000 Stock Options under ESOS 2012 Scheme and 20,26,200 Stock Options under ESOS 2017 Scheme were issued to eligible employees. 1,74,000 Stock Options under ESOS 2012 Scheme and 44,18,650 Stock Options under ESOS 2017 Scheme are outstanding as on March 31, 2022.

During the year under review, prior to the Initial Public Offer (âIPOâ) of its equity shares, your Company amended the ESOS 2012 & 2017 Scheme of the Company by passing special resolutions at its general meeting held on September 30, 2021 so as to meet the regulatory requirements, as mandated by the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (âSEBI SBEB Regulationsâ). Further post IPO of its equity shares, as per requirement of Regulation 12(1) of the SEBI SBEB Regulations, ESOP Schemes were ratified by the Shareholders of the Company by way of postal ballot on February 09, 2022. There is no material change in the ESOP Schemes and they are in compliance with the provisions of SEBI SBEB Regulations and other applicable provisions of law.

The applicable disclosures as stipulated under Regulation 14 of SEBI SBEB Regulations with regard to Employees Stock Option Plan of the Company are available on the website of the Company and

weblink for the same is https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/annual-report/21-22/esop-sebi-disclosure-fy-21-22.pdf

A certificate from M/s. S. N, Ananthasubramanian & Co., Company Secretaries, the Secretarial Auditor of the Company, confirming that the aforesaid schemes have been implemented in accordance with the SEBI SBEB Regulations, will be open for inspection at the ensuing Tenth Annual General Meeting.

H. Investor Education and Protection Fund (âIEPFâ)

âTransfer of unclaimed/unpaid amount to the Investor Education and Provident Fundâ has been covered in the Corporate Governance Report forming of the Annual Report.

I. Related party transactions

All transactions with related parties were reviewed and approved by the Audit Committee and are in accordance with the Policy on dealing with and materiality of Related Party Transactions and the Related Party Framework, formulated and adopted by the Company. An omnibus approval from the Audit Committee is obtained for the related party transactions which are unforeseen in nature.

All contracts/arrangements/transactions entered into by the Company during the year under review with Related Parties were in the ordinary course of business and on armâs length. During the year under review, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions or which is required to be reported in Form No. AOC-2 in terms of Section 134(3) (h) read with Section 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. Accordingly, there are no transactions that are required to be reported in Form AOC-2.

The Companyâs Policy on Materiality of Related Party Transactions and on dealing with Related Party Transaction is available on the website of the Company at https://www.nykaa.com/media/wysiwyg/2021/

I nvestors-Relations/pdfs/10-11/Related-Party-Transaction- Policy.pdf.

The details of the related party transactions as per Indian Accounting Standards (IND AS) - 24 are set out in Note 43 to the Standalone Financial Statement of the Company. The Company in terms of Regulation 23 of the Listing Regulations submits within 15 days from the date of publication of its standalone and consolidated financial results for the half year, disclosures of related party transactions on a consolidated basis, in the specified format to the stock exchanges. The said disclosures can be accessed on the website of the Company at https://www.nykaa.com/ stock-exchange-fi lings.

J. Conservation of energy, technology absorption, foreign exchange earnings and outgo

The foreign exchange earnings and outgo are as below:

Particulars	2021-22	2020-21
Earnings in Foreign	'' 15.69 million	Nil
Exchange
Expenditure in Foreign	'' 271.66 million	'' 84.78 million
Exchange

identification therein of elements of risk, if any, which may threaten the existence of the Company which may be accessed at https://www.nykaa.com/media/ wysiwyg/2021/Investors-Relations/pdfs/10-11/Risk-Management-Policy.pdf

L. Internal financial control

According to Section 134(5)(e) of the Act the term Internal Financial Control (IFC) means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Act also mandate the need for an effective Internal Financial Control system in the Company which should be adequate and shall operate effectively. Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy ofInternal Financial Controls with reference to the financial statements to be disclosed in the Boardâs report.

The key internal financial controls have been documented, automated wherever possible and embedded in the respective business processes.

Assurance to the Board on the effectiveness of internal financial controls is obtained through 3 Lines of Defence which include:

a) Management reviews and self-assessment;

b) Continuous controls monitoring by functional experts; and

c) Independent design and operational testing by the external professional firm.

M. Policy on Directorsâ Appointment and Remuneration

In terms of Section 178 of the Act and Regulation 19 of the Listing Regulations, the Board of your Company, on recommendation of the Nomination

and Remuneration Committee (âNRCâ), had adopted a âRemuneration Policy for Directors, Key Managerial Personal (âKMPâ) and other employees (âRemuneration Policyâ) and âPolicy on Board Diversityâ.

The salient features of the Policies are outlined in the Corporate Governance Report and the Policies are made available on the Companyâs website, which can be accessed using the link https://www.nykaa.com/policies

N. Particulars of Loans, Guarantees and Investments

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

Your Company is committed to create and provide an environment free from discrimination and harassment including sexual harassment for all its employees. Your Company has in place Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 which mandates no tolerance against any conduct amounting to workplace sexual harassment. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and conclusively handled during the year 2021-22:

Particulars	Number of Complaints
Number of complaints received	Nil
Number of complaints disposed off	Nil
Number of complaints pending as	Nil
on end of the financial year	Nil

P. Environment & Safety

Your Company is conscious of the importance of environmentally clean and safe operations and has framed and adopted Health, Safety and Environment

(HSE) Policy which can be accessed at https:// www.nykaa.com/media/wysiwyg/2021/Investors-Relations/pdfs/10-11/Nykaa-Health-Safety-and-Environment-Policy.pdf. The Companyâs policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

Your Company is committed to the highest standards of health, safety and environment practices within the organisation and the extended areas within our influence, with an aim to provide safe and healthy working environment to our employees, customers, business partners, suppliers and visitors.

During the year under review, the Company continued its waste management efforts through various environment friendly measures i.e., use of eco-friendly packaging material, recycling of plastic waste and redesigning packaging to reduce plastic waste. Scrap disposal is in line with industry benchmarks.

GENERAL

Your Directors state that no disclosure or reporting is

required in respect of the following items as there were

no transactions/events on these items during the year

under review:

â¢ There was no change in the nature of business of your Company as stipulated under sub-rule 5(ii) of Rule 8 of Companies (Accounts) Rules, 2014.

â¢ No significant or material orders were passed by the Regulators or Courts or Tribunals, which impact the going concern status and Companyâs operations in future.

â¢ Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except Employeesâ Stock Options Schemes referred to in this Report.

â¢ No fraud has been reported by the Auditors to the Audit Committee or the Board.

â¢ There is no application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the FY 2021-22.

â¢ The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

â¢ Your Company has not issued Equity shares with differential rights as to dividend, voting or otherwise; and

â¢ Your Company has not raised funds through preferential allotment or qualified institutions placement as per Regulation 32(7A) of the Listing Regulations.

SECRETARIAL STANDARDS

MAINTENANCE OF COST RECORDS

ACKNOWLEDGEMENT

The Directors take this opportunity to place on record their warm appreciation for the valuable contribution, untiring efforts and spirit of dedication demonstrated by the employees and officers at all levels, in the sure and steady progress of the Company, despite the unprecedented challenges posed by the Covid pandemic. The Directors would also like to thank the shareholders for their support and contribution. We look forward to their continued support in future.

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article

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Directors Report of FSN E-Commerce Ventures Ltd.

Financial Performance â An Overview

REVIEW OF OPERATIONS

DETAILS OF MATERIAL CHANGES ANDCOMMITMENTS FROM THE END OF THEFINANCIAL YEAR

RESERVES

DIVIDEND

DIVIDEND DISTRIBUTION POLICY

BUSINESS RESPONSIBILITY AND SUSTAINABILITYREPORT (''BRSR'')

CORPORATE GOVERNANCE

ANNUAL RETURN

DIRECTORS'' RESPONSIBILITY STATEMENT

AUDITORS AND THEIR REPORT

(i) Statutory Auditors

(ii) Secretarial Auditors

REGISTRAR AND TRANSFER AGENT

DISCLOSURES IN TERMS OF THE PROVISIONS OFTHE ACT & THE LISTING REGULATIONS

A. Board of Directors ("Board")

B. Committees of the Board

C. Directors and Key Managerial Personnel

D. Remuneration of Directors and Employees

E. Vigil Mechanism/Whistle-Blower

F. Corporate Social Responsibility (''CSR'')

G. Employee Stock Option Scheme and ShareBased Employee Benefits

H. Investor Education and Protection Fund(''IEPF'')

I. Related Party Transactions

J. Conservation of Energy, TechnologyAbsorption, Foreign Exchange Earnings andOutgo

K. Risk Management

L. Internal Financial Control

M. Policy on Directors'' Appointment andRemuneration

N. Particulars of Loans, Guarantees andInvestments

O. Disclosure under the Sexual Harassment ofWomen at Workplace (Prevention, Prohibitionand Redressal) Act, 2013

P. Environment & Safety

GENERAL

SECRETARIAL STANDARDS

MAINTENANCE OF COST RECORDS

ACKNOWLEDGEMENT

(i) Statutory Auditors

(ii) Secretarial Auditor

A. Board of Directors ("Board")

(i) Number of meetings

(ii) Directors retiring by rotation

(iii) Board evaluation

(iv) Declaration of independence

(v) Familiarisation programme for Independent Directors

B. Committees of the Board

C. Directors and Key Managerial Personnel

D. Remuneration of Directors and Employees

E. Vigil Mechanism/Whistle-Blower

F. Corporate Social Responsibility (''CSR'')

G. Employee Stock Option Scheme and Share Based Employee Benefits

H. Investor Education and Protection Fund (''IEPF'')

I. Related Party Transactions

J. Conservation of Energy, Technology

Absorption, Foreign Exchange Earnings and Outgo

K. Risk Management

L. Internal Financial Control

M. Policy on Directors'' Appointment and Remuneration

N. Particulars of Loans, Guarantees and Investments

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

P. Environment & Safety

(ii) Secretarial Auditor

A. Board of Directors (âBoardâ)

(iv) Declaration of independence

(v) Familiarisation programme for Independent Directors

E. Vigil Mechanism/Whistle-Blower

F. Corporate Social Responsibility (âCSRâ)

G. Employee Stock Option Scheme and Share Based Employee Benefits

H. Investor Education and Protection Fund (âIEPFâ)

I. Related Party Transactions

K. Risk Management

L. Internal Financial Control

N. Particulars of Loans, Guarantees and Investments

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

P. Environment & Safety

GENERAL

AUDITORS AND THEIR REPORT

(ii) Secretarial Auditor

(iv) Declaration of independence

(v) Familiarisation Programme for Independent Directors

ii. Nomination & Remuneration Committee

Financial Performance â An Overview

DETAILS OF MATERIAL CHANGES AND
COMMITMENTS FROM THE END OF THE
FINANCIAL YEAR

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT (''BRSR'')

DISCLOSURES IN TERMS OF THE PROVISIONS OF
THE ACT & THE LISTING REGULATIONS

G. Employee Stock Option Scheme and Share
Based Employee Benefits

H. Investor Education and Protection Fund
(''IEPF'')

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

M. Policy on Directors'' Appointment and
Remuneration

N. Particulars of Loans, Guarantees and
Investments

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

A. Board of Directors (âBoardâ)

F. Corporate Social Responsibility (âCSRâ)

H. Investor Education and Protection Fund (âIEPFâ)

iii. Stakeholdersâ Relationship Committee

M. Policy on Directorsâ Appointment and Remuneration