Directors Report of GHCL Textiles Ltd.

Mar 31, 2025

We are delighted to present the 5^th Boardâs Report and the Audited Financial Statements of the Company for the financial year ended March 31, 2025.

In this report, we highlight the key achievements, challenges, and progress made by our Company during the reporting financial year. We delve into the core aspects of our business, including our financial performance, operational activities, governance practices, and our contributions to the environment, society, and stakeholders.

FINANCIAL RESULTS AND STATE OF AFFAIRS

Your Directors are pleased to inform that post demerger of Spinning Division of GHCL Limited (âDemerged Companyâ) into GHCL Textiles Limited (âResulting Companyâ), Company started its business operations w.e.f. April 01, 2023. Summary of the financial performance of the Company for the financial year ended March 31, 2025 (compared to the previous year ended on March 31, 2024) as follows:

Particulars	? in crores
Particulars	Year ended March 31,2025	Year ended March 31,2024
Net Sales /Income	1,168.12	1059.50
Gross profit before interest and depreciation	116.68	89.26
Finance Cost	2.74	7.35
Profit before Depreciation and amortization expense	113.94	81.91
Depreciation and amortization expense	50.65	47.36
PBT before exceptional items	63.29	34.55
Profit before Tax (PBT)	63.29	34.55
Tax Expenses	7.32	9.50
Profit after Tax	55.97	25.05
Profit for the year	55.97	25.05
Other comprehensive income (OCI)	0.43	1.44
Total Comprehensive income for the period	56.40	26.49
Balance brought forward from last year	26.48	(0.01)
Appropriations
FVTOCI Reserve	--	-
Final Dividend	4.78	-
Balance carried to Balance Sheet	78.10	26.48
EPS (basic) (in ?)	5.86	2.62
EPS (diluted) (in ?)	5.86	2.62
Book Value of Shares (in ?)	150.38	144.98

Company discontinued the production at the outdated Kaveri section of Manaparai unit of the Company w.e.f. March 24, 2025, due to high repair and maintenance costs associated with aging machinery. The proceeds from the sale of these assets will be strategically utilized to modernize other sections of the Unit, with a focus on value-added products.

The financial statements have been prepared in accordance with the Indian Accounting Standard (Ind AS). Adhering to Ind AS ensures compliance, transparency, and reliability in financial reporting, accurately presenting the Companyâs financial position, performance, and cash flows.

DIVIDEND

We are pleased to announce that in accordance with our Dividend Distribution Policy, the Board of Directors has recommended a dividend of ? 0.50(fifty paise) per equity share of ? 2/- each, representing 25 % of the paid-up equity share capital, for the financial year ending on March 31, 2025.

The proposed dividend on equity shares is subject to the approval of the shareholders at the upcoming Annual General Meeting (AGM) scheduled on Monday, July 21, 2025.

Upon shareholderâs approval the dividend will be paid after the AGM, commencing on July 21, 2025 (Monday). The Record Date for determining the shareholders eligible for the dividend will be July 14, 2025 (Monday).

In compliance with Section 194 of the Income Tax Act, 1961, our Company is obligated to deduct Tax Deducted at Source (TDS) at a rate of 10% on dividend payments. However, if the aggregate amount of dividend payable to an individual resident shareholder does not exceed ? 10,000, no TDS shall be deducted. Dividend payments made to entities such as Life Insurance Corporation, General Insurance Corporation of India, specified insurers, and Mutual Funds, as per Section 10(23D) of the Income Tax Act, 1961.

In case of non-resident shareholders, tax shall be deducted at source(TDS)at the rate of 20% along with the applicable surcharge and cess as per Section 195 of the Income Tax Act, 1961.

The Company remains committed to adhering to the applicable regulatory requirements, promoting transparency, and maximizing shareholder value through responsible dividend distribution practices.

TRANSFER TO RESERVES

The Board of Directors has decided that no amount of profit for FY 2024-25 shall be transferred to the reserve account.

SHARE CAPITAL

As of March 31, 2025, the paid-up Equity Share Capital of the Company is ? 19,11,71,572 comprising of 9,55,85,786 equity shares of ? 2/- each

Suspense Escrow Account:

Pursuant to the approved Scheme of Demerger effective from April 1, 2023, the Board of Directors of Resulting Company, GHCL Textiles Limited in its meeting held on April 12, 2023 issued and allotted 9,55,85,786 equity shares of ? 2/- each to the shareholder of Demerged Company (GHCL Limited) who held shares of demerged Company as on cut-off date (i.e. April 08, 2023). Further as per the approved Scheme and in compliance with SEBI guidelines, Company issued and allotted shares only in Demat mode and all the shares due to physical shareholders were credited to a separate Suspense Escrow Demat Account maintained by the Company

The Company had sent intimation letters alongwith a detailed procedure for claiming the entitled shares in GHCL Textiles Limited to the address available with the RTA. The detailed procedure and necessary Forms for claiming said shares from Suspense Escrow Demat Account are also available on the website of the Company on the following links https://ghcltextiles.co.in/claim-procedure-physical-shares.

Physical shareholders who hold shares of Demerged Company on record date, are required to submit their claim alognwith the requisite documents and completed forms to the RTA, who will process the request. The details of shares lying in Suspense Escrow Account are as follows:

Particulars	No. of share-	No. of
	holders	shares
Aggregate Number of Shareholders and shares in Suspense Escrow Account at the beginning of the year i.e. as on April 1, 2024	8,315	19,54,028
Less: Number of Shareholders who claimed shares from Suspense Escrow Account during the year 2024-25	165	38,985
Number of Shareholders and outstanding shares lying in the Suspense Escrow Account at the end of the year i.e. as on March 31, 2025	8,150	19,15,043

Investor Education and Protection Fund (IEPF)

GHCL Textiles Limited allotted and credited 10,90,366 equity shares of the Company to the eligible Shareholders as per their entitlement of the Shareholders, who held shares of GHCL Limited (Demerged Company) as on record date (i.e. April 08, 2023), and whose share had already been transferred to the IEPF account by the Demerged Company. Such Shareholders can claim their respective shares in GHCL Textiles Limited from the IEPF Authority by filing Form IEPF- 5. The detailed procedure for claiming shares from IEPF account is also available on the website of the Company i.e. https://ghcltextiles. co.in/claim-procedure-iepf

BOARD MEETINGS

The Board of Directors follows a structured approach to planning and conducting its meetings, which are typically scheduled in advance. However, meetings may occasionally be convened at shorter notice for urgent matters, subject to compliances with applicable requirements. During the financial year ended March 31, 2025, the Board of Directors met four times (i.e. on

May 06, 2024, August 01, 2024, October 29, 2024 and February 03, 2025) to review the strategic, operational and financial performance of the Company. The details of the Board meetings are also provided in the Corporate Governance Report.

The intervals between the meetings were in compliance with the Companies Act, 2013 and SEBI Listing Regulations, 2015, thereby ensuring effective governance and timely performance evaluation.

DIRECTORS

(i) Your Directors are pleased to announce that Mr. Ravi Shanker Jalan, Non-Executive Director, is retiring by rotation and being eligible, offer himself for re-appointment. The Board recommends his re-appointment at the ensuing Annual General Meeting.

(ii) Your Directors are pleased to inform that based on the recommendations of the Nomination and Remuneration Committee and the Board of Directors, the shareholders have appointed Mrs. Sudha Pillai, IAS (Retd.), Mr. V.K. Jeyakodi, IAS (Retd.) and Mr. C R Rajagopal as Independent Directors for a term of 5 consecutive years w.e.f. March 01, 2025 to February 28, 2030.

Further Mrs. Vijaylaxmi Joshi, IAS (Retd.), Dr. Manoj Vaish and Mr. Arun Kumar Jain, IRS (Retd.) have completed their term as Independent Directors of the Company on March 05, 2025. The Board of Directors and management of the Company expressed their appreciation and gratitude to all of them for their valuable contribution for sustainable growth of the Company.

(iii) All Independent Directors have submitted declarations confirming their independence and affirming their ability to discharge duties objectively and without external influence. Compliance with Section 149(6) of the Companies Act, 2013, and Regulation 16(1) (b) & Regulation 25(8) of the SEBI Listing Regulations has been duly ensured. Additionally, no director is debarred from holding the office of director pursuant to any order issued

by SEBI, MCA or any other authority in line with SEBI circular dated June 20, 2018 on the enforcement of SEBI order on the appointment of Directors by the listed Companies.

In the opinion of the Board, the Independent Directors on the Board of the Company possess the requisite qualifications, experience, expertise, proficiency and uphold high standards of integrity in terms of Rule 8 of the Companies (Accounts) Rules, 2014.

(iv) Procedure for Nomination and Appointment of Directors

Detailed information regarding the nomination and appointment process of Directors, along with the list of core skills, expertise, and competencies of the Board of Directors, is provided in the Corporate Governance Report, which is formed part of the Annual Report. The Corporate Governance Report offers comprehensive insights into the governance practices of the Company, ensuring transparency and accountability in the selection and composition of the Board of Directors.

(v) Familiarization program for Independent Directors:

The Company has a structured familiarization programme for its Independent Directors. The objective of the programme is to enable the Independent Directors to understand the Company, its operations, business environment, and the regulatory framework applicable to it. At the time of appointment of a Director (including Independent Directors), a formal letter of appointment is issued to him, which inter alia outlines the role, function, duties and responsibilities expected of them as a Director of the Company. The Director is also briefed on the compliance obligations under the Companies Act, 2013, Listing Regulations and other applicable laws. The management of the Company also conducted interactions with the newly appointed Directors to familiarize them with the Companyâs operations. Upon request, site visits to various plant locations are organized by the Company to provide the Directors with practical understanding of the

operations of the Company. Further, on an ongoing basis and as part of Agenda of Board and Committee meetings, presentation are regularly made on various matters inter alia covering the Companyâs business and operations, industry developments and regulatory updates.

(vi) Board Evaluation

In accordance with the Companies Act, 2013, the SEBI Guidance Note on Board evaluation issued (via SEBI Master Circular dated July 11, 2023) and the relevant provisions of the SEBI Listing Regulations, 2015, the Independent Directors conducted an annual evaluation of the Board and its Committees and individual Directors. The evaluation process involved a separate meeting of the Independent Directors and an assessment by the Board as a whole.

The Board assessed the effectiveness of its functioning, the Committeesâ performance, and the individual Directorsâ contributions based on feedback gathered from Directors and Committee members. The performance evaluation of the independent Directors was conducted on the Board meeting held on May 06, 2024, excluding the director being evaluated.

A dedicated meeting of the Independent Directors was held on April 15, 2024, to review the performance of non-independent Directors, the overall functioning of the Board and its Committees.

The criteria for performance evaluation were broadly based on the SEBI Guidance Note on Board Evaluation, encompassing aspects such as Committee structure and composition, effectiveness of Committee meetings, and other governance parameters.

The performance evaluation of the Board and its Committees focused on various factors, including their functions, responsibilities, competencies, strategy, oversight tone at the top, risk identification and control, diversity, and nature of the business. A comprehensive questionnaire were circulated to the Independent Directors, covering multiple aspects of the Boardâs functioning, organization culture,

discharge of duties, professional obligations, and governance standards. The questionnaire aimed to assess Directorsâ knowledge, independence in decision-making, involvement in business planning, constructive engagement with colleagues, and understanding of the Companyâs risk profile. Additionally, the Chairman of the Board and/ or Committee was evaluated based on leadership, coordination, and steering capabilities.

The Nomination & Remuneration Committee reviewed the performance of individual Directors, taking into account their contributions as members of the Board and its Committees. The Committee also determined the quantum of profit-based commission payable to Directors based on their individual performance and contribution.

These evaluation processes ensure that the Board operates effectively, individual Directors contributes significantly, and appropriate remuneration is provided based on performance.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 read with Section 2(51) of the Companies Act, 2013, the Board of Directors in its meeting held on March 06, 2023 had appointed Mr. R Balakrishnan, as the CEO of the Company, Mr. Gaurav V as the CFO of the Company and Mr. Lalit Narayan Dwivedi, as a Company Secretary and Compliance Officer of the Company. These appointments constituted the Key Managerial Personnel (KMP) of the Company in accordance with the statutory requirements. Further, Mr. Gaurav V. resigned from the post of CFO and was relived from the services of the Company w.e.f. closing of business hours on March 31, 2025. Apart from this, there were no change in the composition of the Key Managerial Personnel during the financial year 2024-25.

Subsequent to the end of the financial year, Mr. R Balakrishnan, CEO of the Company will superannuated on May 31, 2025 and to ensure smooth transition of business, based on the recommendation of Nomination & Remuneration Committee, the Board of Directors in its meeting held on May 05, 2025, approved the appointment of Mr. Marshal Rajendrakumar Sonavane as CEO w.e.f.

June 01, 2025 and during the interim period he is serving as CEO (designate). Further the Board of Directors, on recommendation of NRC and Audit Committee, approved the appointment Mr. M. Parasuraman as CFO of the Company w.e.f. May 29, 2025.

MANAGERIAL REMUNERATION &

PARTICULARS OF EMPLOYEES

Disclosures regarding remuneration and other relevant details, as required by Section 197(12) of the Companies Act, 2013, and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, have been provided as an Annexure to this Report.

Further as per the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement containing the names and other particulars of employees who receive remuneration exceeding the limits specified in the aforementioned rules has been attached as Annexure-I to this Report. This statement provides the necessary information about such employees in accordance with applicable accounting requirements.

RE-CONSTITUTION OF VARIOUS COMMITTEES OF THE BOARD OF DIRECTORS

In view of the changes in the composition of the Board and to strengthen corporate governance practices and executing smooth business operations of the Company, the Board of Directors has constituted/ reconstituted the following Committees:

Sr. No.	Name of Committees
1	Audit Committee
2	Nomination & Remuneration Committee
3	Stakeholders Relationship Committee
4	Risk Management Committee
5	Corporate Social Responsibility Committee
6	Banking & Operations Committee

1. Audit Committee

The Board of Directors in its meeting held on March 06, 2023 constituted the Audit Committee as per the

requirement of Section 177 of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014, and Regulation 18 of the Listing Regulations. The Committee was subsequently reconstituted w.e.f. March 06, 2025. The primary purpose of the Audit Committee is to ensure effective supervision and monitoring of the managementâs financial reporting process, while upholding the highest standards of transparency, integrity, and financial reporting quality. As on March 31, 2025, the Committee comprises of three members. The Committee is chaired by Mr. C R Rajagopal, with Mr. V K Jeyakodi, IAS(Retd.) and Mr. Raman Chopra serving as members. All members of the Committee are Non-Executive Directors (majority of Independent Director), having expertise in finance, accounts, strategy, tax, and general administration. During the financial year, the Committee convened four meetings (May 06, 2024, August 01, 2024, October 29,2024 and February 03, 2025). Further details about the Audit Committee can be found in the Corporate Governance Report at page no. 57-60.

2. Nomination & Remuneration Committee

The Nomination & Remuneration Committee has been constituted as per the requirement of Section 178 of the Companies Act, 2013 and Regulation 19 of the Listing Regulations. The Committee was reconstituted w.e.f. March 06, 2025. The Committee is responsible for determining the qualifications, positive attributes, and independence of Directors, and to recommending a remuneration policy for Directors, Key Managerial Personnel, and other employees.

As on March 31, 2025, Nomination & Remuneration Committee comprised of three Independent Directors. The Committee is chaired by Mrs. Sudha Pillai, IAS (Retd), with Justice Ravindra Singh (Retd.) and Mr. V K Jeyakodi, IAS (Retd.) serving as members. Further details about the Committee can be found in the Corporate Governance Report at page no. 60- 64.

3. Stakeholders Relationship Committee

The Stakeholders Relationship Committee has been established in accordance with Section 178(5) of the Companies Act, 2013, and Regulation 20 of the Listing Regulations. The Committee was reconstituted w.e.f.

March 06, 2025. The Committeeâs main responsibility is to address and resolve grievances raised by the Companyâs security holders, which include concerns related to share transfers, non-receipt of annual reports, and non-receipt of dividends, among others. The detail composition of the Committee is provided in Corporate Governance Report.

As on March 31, 2025, Stakeholders Relationship Committee comprised Four Non-Executive Directors. The Committee is chaired by Justice Ravindra Singh (Retd.) with Mr. Ravi Shanker Jalan, Mr. Raman Chopra, and Mr. Neelabh Dalmia serving as members of the Committee. Further details about the Committee can be found in the Corporate Governance Report at page no. 64-66.

4. Risk Management Committee

As per Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, for constitution of a Risk Management Committee is mandating for top 1000 Companies, based on market capitalization as at the end of the immediate preceding financial year. All though this requirement is not applicable upon the Company, the Board of Directors as a measure of good Corporate Governance, has voluntarily constituted a Risk Management Committee and formulated the Risk Management Policy to identify and mitigate key business risks. Subsequently, the Risk Management Committee was reconstituted w.e.f. March 06, 2025.

As on March 31, 2025, the Committee comprised of five Non-Executive Directors. Mr. C R Rajagopal, Independent Director serving as the Chairman. The other members of the Committee are Mr. Anurag Dalmia, Mr. Ravi Shanker Jalan, Mr. Raman Chopra and Mr. Neelabh Dalmia. Detailed information about the Committee and its activities can be found in the Corporate Governance Report at page no. 68-69.

The Company believes that various factors such as technological advancements, geopolitical environment, regulatory and environmental requirements have significant impacts on the business of the Company. To ensure sustainability, it is essential to systematically manage risks and seize opportunities arising from

these factors. The Board of Directors holds the ultimate responsibility for risk oversight, while the Risk Management Committee provides guidance for implementing the risk management policy throughout the organization.

The operational heads of each business unit are primarily accountable for implementing the Companyâs Risk Management Policy and fostering a risk-aware culture that support performance excellence. Senior executives in respective functional areas act as risk owners, monitoring key risks and proactively implementing appropriate mitigation plans. Their role is to prevent significant deviations or adverse events and to contribute to create a long term value creation for the business.

The Companyâs Risk Management Policy, approved by the Board, can be accessed on the Companyâs website https://ghcltextiles.co.in/wp-content/uploads/2023/02/ Risk-Management-Policy.pdf

5. Corporate Social Responsibility (CSR) Committee

Our Company is committed to fostering inclusive growth and has been actively engaged in projects aimed at societyâs holistic development and welfare. Through the GHCL Foundation Trust, the Company expanded its CSR initiatives to reach a broader spectrum of beneficiaries, supporting marginalized communities and developing social infrastructure for their well-being.

The Companyâs CSR activities are guided by a comprehensive CSR Policy. The details of Policy and annual plan can be accessed on Companyâ website www. ghcltextiles.co.in. The CSR Policy can be found directly at the link: https://ghcltextiles.co.in/investors/csr-policies.

The CSR Committee of the Company was reconstituted with four Non-Executive Directors. Mr. Anurag Dalmia, Non-Executive Director serving as the Chairperson. The other members of the Committee are Justice Ravindra Singh (Retd.), Mrs. Sudha Pillai, IAS (Retd.), Independent Directors and Mr. Neelabh Dalmia, Non-executive Director. Detailed information about the Committee and its activities can be found in the Corporate Governance Report and website of the Company. A detailed report on CSR activities is provided as Annexure-II.

6. Banking & Operations Committee

The Board of Directors had constituted the Banking and Operations Committee to facilitate the day to day functioning of the Company and to exercise powers delegated by the Board. This Committee meets as per the requirement of business, to expedite all matters relating to operations and granting authority for various functional requirements such as issue of Power of Attorney, arranging / negotiating of term loans, working capital loan, short term loan, dealings with Central / State Governments including their agents and various statutory / judicial / regulatory / local / commercial / excise / customs / port / sales tax / income tax / electricity board etc. and other authorities on behalf of the Company in line with the delegated authority of Board of Directors from time to time. As on March 31, 2025, the Members of the Committee include Justice Ravindra Singh (Retd.), Independent Director, Mr. Raman Chopra and Mr. Neelabh Dalmia, Non-Executive Directors of the Company.

NOMINATION AND REMUNERATION POLICY

The Board, upon the recommendation of NRC, has approved the Nomination and Remuneration Policy for Directors, Key Managerial Personnel (KMP), and all other employees. The Policy aims to attract, retain, and motivate qualified individuals, ensure market competitiveness in salaries, provide performance-based rewards, and comply with statutory requirements. It provide guidance for the effective management of nominations and remuneration decision, aligning with Companyâs strategic objectives and industry benchmark. The Policy is available on the website of the Company https://ghcltextiles.co.in/wp-content/uploads/2024/04/ GHCL-Textiles-Limited-Nomination-and-Remunration-Policy.pdf

VIGIL MECHANISM / WHISTLE BLOWER POLICY

As a conscious and vigilant organization, GHCL Textiles Limited believes in the conduct of the affairs of its constituents in a fair and transparent manner, by adopting the highest standards of professionalism, honesty, integrity and ethical conduct. In its endeavor to provide its employee a secure and fearless working environment, the Company has established the âWhistle Blower Policyâ.

The objective of this Policy is to provide a platform for the Directors and employees to report any instance of unethical behaviour, actual or suspected fraud or violation of Companyâs code of conduct or Ethics Policy, directly to the Ombudsperson and /or Chairperson of the Audit Committee. The Whistle Blower Policy is posted on the website of the Company at www.ghcltextiles.co.in. There are no complaints reported during the financial year under Vigil mechanism.

DIVIDEND DISTRIBUTION POLICY

As per Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015, our Companyâs Board of Directors formulated and adopted the Dividend Distribution Policy (DDP) in a meeting held on January 02, 2023 and further amended the policy in its meeting held on May 05, 2025. The policy has been established to promote transparency and clarity in determining the quantum of dividends. It outlines the Boardâs commitment to maintaining a dividend pay-out ratio, which includes the dividend tax, in the range of 8% to 12% of profits after tax (PAT) on a standalone basis.

The Dividend Distribution Policy is available on Companyâs website at the following link : https:// ghcltextiles.co.in/wp-content/uploads/2025/05/GHCL-Textiles-Dividend-Policy.pdf

The Policy serves as a guiding framework for the Board of Directors in making decisions on the recommendation of dividends. It ensures a consistent and balanced approach to dividend pay-outs and reaffirms the Companyâs commitment to enhancing shareholderâs value.

DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company is deeply committed to creating and maintaining a safe, inclusive and respectful work environment where every individual is protected from any form of harassment, exploitation, or intimidation. In line with this commitment, and as mandated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (âPOSH Actâ) and its related Rules, the Company has adopted

a comprehensive Policy for the prevention of sexual harassment.

Internal Complaints Committees have been set up at all major locations of the Company. These Committees are entrusted with the responsibility of receiving and addressing any complaints of sexual harassment at the workplace. They operate with transparency, impartiality, and adhere to prescribed timelines, to ensure a fair and unbiased investigation process.

The Company also conducts regular awareness programs to educate employees about their rights, the provisions of the POSH Act, and the available redressal mechanism. These initiatives aim to build a culture of respect, sensitivity, and gender equality in the workplace.

We are pleased to report that no complaint related to sexual harassment were received during the financial year 2024-25 under the POSH Act.

CHANGE IN NATURE OF BUSINESS

During the Financial Year 2024-25, our Companyâs core business remained unchanged, ensuring stability and consistency in our operations and services to customers.

Further, we would like to confirm that there is no material change in the nature of business of the Company during the period from April 1, 2025, to the date of signing this report.

SUBSIDIARIES, JOINT VENTURES & ASSOCIATES

The Company does not have any subsidiary, joint venture or associate Company as on March 31, 2025.

MANAGEMENT DISCUSSION & ANALYSIS

In accordance with Regulation 34 (2) (e) of the SEBI Listing Regulations, 2015, we would like to draw your attention to the comprehensive review of our Companyâs operations, performance, and future outlook provided in the Management Discussion and Analysis (MDA) Report. This report is included as part of this Annual Report and is incorporated herein by reference.

The MDA offers detailed insights into various aspects of our business, including market trends, financial

By upholding strong Corporate Governance standards and integrating best practices, the Company aims to foster trust, integrity, and long-term sustainability. It recognizes that effective governance is essential for creating value and maintaining strong relationships with shareholders, employees, customers, suppliers, and other stakeholders.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

As per the revised Regulation 34(2)(f) of the SEBI Listing Regulations, 2015 and the National Guidelines on Responsible Business Conduct (NGRBC) issued by the Ministry of Corporate Affairs, Government of India, the top one thousand listed Companies by market capitalization are required to prepare and present a Business Responsibility and Sustainability Report (BRSR) in line of the erstwhile Business Responsibility Report(BRR) to the stakeholders.

Starting from the financial year 2022-2023, filing the BRSR has become mandatory for the top 1000 listed companies based on market capitalization. As on December 31, 2024, GHCL Textiles Limited is ranked on 1368^th position at NSE and on 1427^th position at BSE based on market capitalization, accordingly reporting of Business Responsibility and Sustainability Report (BRSR) as per Regulation 34(2)(f) of the Listing Regulations, 2015 is not applicable for FY 2024-25.

SECRETARIAL STANDARDS

During the year under review, the Company has complied with all the applicable provisions of Secretarial Standards issued by Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs of India.

These standards are vital guidelines for ensuring compliance and governance. Adhering to these standards underscores our commitment to transparency, ethical practices, and effective stakeholder communication. Our strict adherence reflects our dedication to robust internal processes, accurate disclosures, and compliance culture, strengthening our governance framework and stakeholder trust.

performance, key achievements, challenges, and strategic initiatives. It provides a holistic view of the Companyâs operations and outlines our managementâs perspective on the future prospects and opportunities.

Stakeholders including shareholders and investors are encouraged to refer to the MDA for a comprehensive understanding of Companyâs business performance and outlook. It serves as a valuable resource for indepth analysis and assessment of Companyâs strategic directions.

CORPORATE GOVERNANCE

The Company places great importance on maintaining the highest standards of Corporate Governance. It recognizes that good governance practices not only promote transparency and accountability but also contribute to the overall credibility and trustworthiness of the organization. In line with this commitment, the Company diligently adheres to the Corporate Governance requirements set out by the Securities and Exchange Board of India (SEBI).

To strengthen its governance framework, the Company has implemented several best practices. These practices encompass various aspects of governance, including board composition and structure, independent Directors, board Committees, risk management, internal controls, ethical conduct, and stakeholder engagement. These practices are designed to ensure effective oversight, decision-making, and protection of the interests of all stakeholders.

As part of the Annual Report, the Company includes a comprehensive report on Corporate Governance, as mandated by Regulation 34 of the SEBI Listing Regulations. This report provides detailed information on the Companyâs governance structure, policies, and practices, giving stakeholders valuable insights into the Companyâs governance framework.

Furthermore, the Company obtains a certificate from its Statutory Auditor, confirming compliance with the conditions of Corporate Governance as stipulated under SEBI Listing Regulations,2015. This certificate serves as an independent validation of the Companyâs adherence to the prescribed governance norms.

AUDITORS AND AUDIT REPORTS

(i) Statutory Auditor

Your Directors would like to inform that in the 1^stAGM held on June 18, 2021, S. R. Batliboi & Co. LLP, Chartered Accountants (ICAI Firm Reg. No. 301003E / E300005), was appointed as the statutory auditor of the Company for a period of five consecutive years i.e. from the conclusion of 1^st AGM till the conclusion of 6^th AGM.

5. R. Batliboi & Co. LLP has audited the books of accounts of the Company for the financial year ended March 31, 2025 and has issued the Audit Report thereon.

(ii) Cost Auditor

The Company maintains cost records as prescribed under Section 148 of the Companies Act, 2013, and appoint Cost Accountant to conduct an audit of these records. The Board of Directors in its meeting held on May 06, 2024 based on the recommendation of the Audit Committee, appointed R J Goel & Co., Cost Accountants, New Delhi, as the Cost Auditor of the Company for the financial year ended on March 31, 2025. The Cost Audit Report for the financial year ended March 31, 2024, does not contain any qualification or adverse remarks requiring clarification or explanation.

(iii) Internal Auditor

As per provisions of Section 138 of the Companies Act, 2013, every Listed Company is required to appoint an Internal Auditor to conduct internal audit of the functions and activities of the Company.

The Board of Directors in its meeting held on May

06, 2024 based on the recommendation of the Audit Committee, has approved the appointment of M/s. SPMB and Co. LLP, Chartered Accountants, Chennai, as the Internal Auditor of the Company for the financial year ended on March 31, 2025 to conduct the internal audit of the activities of the Company.

(iv) Secretarial Auditor

Section 204 of the Companies Act, 2013 read with Regulation 24A of SEBI (Listing Obligations and

Disclosure Requirements) Regulation 2015 inter-alia requires every listed Company to undertake Secretarial Audit and shall annex with its Boardâs Report a Secretarial Audit Report given by a Company Secretary in practice, in the prescribed form.

In line with the requirement of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Regulation 24A of the Listing Regulations and other applicable provisions, if any, the Board of Directors of the Company in its meeting held on May 06, 2024 had appointed Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct Secretarial Audit of the Company for the financial year 2024-25. The Secretarial Audit Report as issued by Secretarial Auditor of the Company is annexed with Boardâs Report as Annexure-III.

(v) Auditorâs Report

The Companyâs Statutory Auditors or Secretarial Auditor did not make any qualification, reservation, adverse remark, or disclaimer in their Report for the financial year ended March 31, 2025. Hence, no further explanation or comment is required under Section 134(3)(f) of the Companies Act, 2013.

LISTING STATUS

Companyâs equity shares are listed on BSE Limited and National Stock Exchange of India Limited w.e.f. June 12, 2023. We have paid the annual listing fees for the years 2024-25 and 2025-26 to both stock exchanges, ensuring our continued listing and trading.

WEB ADDRESS FOR ANNUAL RETURN AND OTHER POLICIES / DOCUMENTS

The Company has a fully functional website viz www.ghcltextiles.co.in. All the Policies/documents are available on the website of the Company as per the statutory requirements. In terms of Section 92(3) read with Section 134(3)(a) of the Act and rules thereto, the Annual Return of the Company in Form MGT - 7 for the financial year ended on March 31, 2025 is available on the Companyâs website at: https://ghcltextiles.co.in/wp-content/uploads/2025/06/ GHCL-Textiles-Annual-Return-FY2024-25.pdf

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

The information on conservation of energy, technology absorption, and foreign exchange earnings and outgo, as required under Section 134 (3) (m) of the Companies Act, 2013 and Rule 8 of the Companies (Accounts) Rules, 2014, is provided in Annexure - IV, which is an integral part of this Report.

RELATED PARTY TRANSATIONS

The Company has not engaged in any significant related party transactions with its Promoters, Directors, Key Managerial Personnel, or other designated persons that could potentially conflict with the Companyâs interests. Therefore, the disclosure requirement under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 does not apply .

All Related Party Transactions undergo thorough review and approval by the Audit Committee. For repetitive transactions conducted on an armâs length basis in the ordinary course of business, prior omnibus approval is obtained from the Committee. Quarterly, a statement detailing all related party transactions, supported by a Certificate from the Chief Financial Officer / person controlling the finance, is presented to both the Committee and the Board.

There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

PARTICULAR OF LOANS/GUARANTEES, OR INVESTMENTS

The details of loans, guarantees, and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to the Financial Statements. These notes offer comprehensive information regarding the nature, terms, and conditions of such loans, guarantees, and investments. They also include disclosures on any Related Party Transactions, if applicable, and any significant developments or changes in these arrangements.

The purpose of including these details in the notes to the Financial Statements is to ensure transparency and provide stakeholders with a clear understanding of the Companyâs financial activities and commitments. By presenting this information, GHCL Textiles Limited aims to adhere to regulatory requirements and promote accountability.

Stakeholders are encouraged to refer to the relevant section in the Financial Statements to obtain a comprehensive overview of the loans, guarantees, and investments made by the Company in accordance with the provisions of Section 186 of the Companies Act, 2013.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability confirm that:

a. in the preparation of the annual accounts for the financial year ended March 31, 2025, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2025 and of the Profit and Loss of the Company for the financial year ended March 31, 2025;

c. the proper and sufficient care has been taken by them for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the annual accounts for the financial year ended March 31, 2025 have been prepared by them on a going concern basis;

e. proper Internal financial controls have been followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f. proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

GENERAL DISCLOSURES

Your Directors state that no disclosure or reporting is

required in respect of the following matters as there is no

transaction on these items during the year under review:

(i) Details relating to deposits covered under Chapter V of the Act.

(ii) Issue of equity shares with differential rights as to dividend, voting or otherwise.

(iii) Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

(iv) The Company does not have any Employee Stock Option Scheme. Further, the Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

(v) 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.

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

(vii) There is no Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016.

ACKNOWLEDGEMENT

The Board of Directors extends its heartfelt gratitude to the customers, vendors, dealers, investors, business associates, and bankers for their unwavering support throughout the year. Their continued trust and collaboration have played a significant role in the Companyâs success.

The Board also acknowledges and appreciates the dedication and contributions of the employees at all levels. Their commitment, hard work, teamwork, and support have been instrumental in overcoming challenges and achieving our goals. We value their resilience and unwavering commitment to the Companyâs growth.

Furthermore, the Board expresses sincere thanks to the Government of India, the State Governments, statutory authorities, and other government agencies for their support. We acknowledge their role in creating a conducive business environment and look forward to their continued support in the future.

The collective efforts and support of all stakeholders have been crucial in driving the Companyâs progress, and the Board acknowledges their invaluable contributions.

Mar 31, 2024

The directors have pleasure in presenting before you the 4^th Boardâs Report and the Audited Statement of Accounts of the Company for the financial year ended 31^st March 2024.

In this report, we highlight the key achievements, challenges, and progress made by our company during the previous year. We delve into the core aspects of our business, including our financial performance, operational activities, governance practices, risk management, and our contributions to the environment, society, and stakeholders.

Financial results and state of affairs

Your directors are pleased to inform that the Scheme

of Arrangement consisting of demerger of Spinning Division of GHCL Limited (âDemerged Companyâ) into GHCL Textiles Limited (âResulting Companyâ)â has been sanctioned by the Honâble National Company Law Tribunal, Ahmedabad (NCLT) vide its order dated February 8, 2023 and certified copy of the NCLT order was received on March 14, 2023.

The Scheme of Arrangement has become effective from April 1, 2023 (âEffective Dateâ).

Please further note that with effect from April 01, 2023 (effective date of Scheme), Company started its business operation. The summary of the financial performance of the Company for the financial year ended March 31, 2024 (compared to the previous year ended on March 31, 2023) as follows:

Particulars	Rs. in crores
Particulars	Year ended March 31, 2024	Year ended March 31, 2023
Net Sales /Income	1059.50	-
Gross profit before interest and depreciation	89.26	(0.01)
Finance Cost	7.35	-
Profit before depreciation and amortisation	81.91	-
Depreciation and Amortisation	47.36	-
PBT before exceptional items	34.55	(0.01)
Profit before Tax (PBT)	34.55	(0.01)
Tax Expenses	9.50
Profit after Tax	25.05	(0.01)
Profit for the year	25.05	(0.01)
Other comprehensive income (OCI)	1.44	-
Total Comprehensive income for the period	26.49	(0.01
Balance brought forward from last year	(0.01)	(0.00)
Appropriations
FVTOCI Reserve	-	-
Final Dividend	-	-
Balance carried to Balance Sheet	26.48	(0.01)

The Management and Analysis Report (MDA) provide detailed discussions on the financial results, operations, and major developments. The financial statements have been prepared in accordance with the Indian Accounting Standard (Ind AS). Adhering to Ind AS ensures compliance, transparency, and reliability in financial reporting, accurately presenting the companyâs financial position, performance, and cash flows. Stakeholders are encouraged to review the MDA for a comprehensive understanding of our performance and value creation efforts.

DIVIDEND

We are pleased to announce that in accordance with our Dividend Distribution Policy, the Board of Directors has recommended a dividend of Rs. 0.50 (Fifty paisa) per equity share of Rs. 2/- each, representing 25 % on the paid-up equity share capital, for the financial year ending on March 31, 2024.

The proposed dividend on equity shares is subject to the approval of the shareholders at the upcoming Annual General Meeting (AGM) scheduled on Monday, July 08, 2024.

Upon approval by the shareholders, the dividend will be paid after the AGM, commencing from July 08, 2024 (Monday). The Record Date for determining the shareholders eligible for the dividend will be July 01, 2024 (Monday). The total dividend payout for the fiscal year 2023-24 will be in accordance with our dividend distribution policy.

In compliance with the provisions of Section 194 of the Income Tax Act, 1961, our company is obligated to deduct Tax Deducted at Source (TDS) at a rate of 10% on dividend payments. However, it is important to note that if the aggregate amount of dividends payable to an individual resident shareholder is up to Rs. 5000, no TDS is deducted. Furthermore, no TDS is applicable for dividend payments made to entities such as Life Insurance Corporation, General Insurance Corporation of India, specified insurers, and Mutual Funds, as mentioned under Section 10(23D) of the Income Tax Act.

For non-resident shareholders, as per Section 195 of the Income Tax Act, 1961, TDS is required to be deducted

at a rate of 20% along with the applicable surcharge on dividend payments.

Our company remains committed to adhering to the applicable regulatory requirements, promoting transparency, and maximizing shareholder value through responsible dividend distribution practices.

TRANSFER TO RESERVES

The Board of Directors has decided that no amount of profit for FY 2023-24 shall be transferred to the reserve account.

SHARE CAPITAL

As of March 31, 2024, the paid-up Equity Share Capital of the company is Rs. 19,11,71,572 comprising of 9,55,85,786 equity shares of Rs. 2/- each. In comparison, as of March 31, 2023, the paid-up Equity Share Capital was Rs. 1,00,000 comprising of 50,000 equity shares of Rs. 2/- each.

SCHEME OF ARRANGEMENT IN THE NATURE OF DEMERGER

The Scheme of demerger for the Yarn business of the GHCL Limited (Demerged Company) with GHCL Textiles Limited (Resulting Company), which was effective on April 1, 2023, successfully completed during the year.

In terms of Clause 6.1 to 6.4 of the approved demerger scheme, the authorized capital of GHCL Textiles Limited increased from Rs. 15 lakhs to Rs. 35.15 Crore and accordingly clause 5 of the memorandum of association of the Company was modified. Further, as per clause 7.2.4 of the Scheme, the initial investment made by Demerged Company in the share capital of Resulting Company was cancelled.

Pursuant to the requirement of approved Scheme, the Board of Directors of the Company in its meeting held on April 12, 2023, had approved the allotment of 9,55,85,786 equity shares of Rs. 2 each to the shareholders of GHCL Limited (Demerged Company), whose names appear in the register of members as on the Record Date i.e. April 8, 2023, in swap ratio of 1 (One) equity share of the Resulting Company of face value of Rs. 2/- each fully paid-up for every 1 (One) equity share held in the Demerged

Company of face value of Rs. 10 each fully paid-up. Stock Exchanges (BSE & NSE) had granted their final approval for listing of Shares of GHCL Textiles Limited on June 8, 2023 and trading of said shares on stock exchanges started from June 12, 2023.

Please also note that the proportion in which the cost of acquisition of the equity share were split between Demerged Company and Resulting Company for the purpose of computing the capital gain/loss as per the provisions of Sections 49(2C) and 49(2D) of the Income Tax Act, 1961 (âIT Actâ). Accordingly, the cost of acquisition of equity shares of GHCL Limited (i.e. the Demerged Company) is 65.45% and the cost of acquisition of equity shares of GHCL Textiles Limited (i.e. the Resulting Company) is 34.55%. Now, all the formalities related to demerger of spinning division have been completed:

Suspense Escrow Account:

All the Shareholders, who were holding shares of GHCL Limited (Demerged Company) in physical mode as on record date (i.e. April 08, 2023) were entitled for shares of GHCL Textiles Limited (Resulting Company). However, in accordance with the SEBI (Issue of Capital and Disclosures Requirements) Regulations, 2018 and as per approved Scheme, equity shares have been issued in Dematerialized form only. Hence, equity shares of GHCL Textiles Limited which were allotted to the physical shareholders, of Demerged Company (GHCL Limited) have been kept in suspense escrow account of the Company, opened for this purpose.

Your Company had sent intimation letter alongwith detailed procedure for claiming entitled shares in GHCL Textiles Limited at the address available with the RTA. Detailed procedure and necessary Forms for claiming said shares from Suspense Escrow Demat Account of the Company are available on the website of the Company on the following link https://ghcltextiles.co.in/claim-procedure-physical-shares.

Physical shareholders of Demerged Company who were holding shares of Demerged Company on record date, should submit their claim with requisite documents and completed forms to the RTA, who will process the request. Details of shares laying in Suspense Escrow Account is as follows:

Particulars	No. of shareholders	No. of shares
Shares transferred in Suspense Escrow Demat Account as on April 12, 2023	8468	19,96,007
shares claim processed during the year	153	41,979
Shares outstanding as on March 31, 2024	8315	19,54,028

Investor Education and Protection Fund (IEPF)

GHCL Textiles Limited allotted and credited 10,90,366 equity shares of the Company as per entitlement of the Shareholders, who were holding shares of GHCL Limited (Demerged Company) as on record date (i.e. April 08, 2023), and whose share were already transferred in IEPF account by Demerged Company (i.e. GHCL Limited). Shareholder can claim shares of GHCL Textiles Limited as per their entitlement from IEPF by filing form IEPF-5. Detailed procedure for claiming shares from IEPF account is also available on the website of the Company https://ghcltextiles.co.in/claim-procedure-iepf.

BOARD MEETINGS

The Board meetings of your company are normally planned in advance in consultation with the Board Members. However, in certain emergency situation, Board meeting was also convened on shorter notice after complying necessary requirement for the same. During the financial year ended March 31, 2024, the Board of Directors met four times (i.e. on April 12, 2023, August 07, 2023, November 03, 2023 and February 03, 2024) to review strategic, operational and financial performance of the company. The details of the boardâs meetings are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

DIRECTORS

(i) Your directors are pleased to inform that Mr. Neelabh Dalmia, is director retiring by rotation and being

eligible, offer himself for re-appointment. The Board recommends his re-appointment at the ensuing Annual General Meeting.

(ii) Your directors are pleased to inform that the Board of Directors of the Company appointed Ms. Vijaylaxmi Joshi, Mr. Manoj Vaish and Mr. Arun Jain as Additional Director(s) in the category of Independent Director(s) of the Company w.e.f March 06, 2023 for a term of two consecutive years, subject to the approval of the shareholders of the Company. The shareholders of the Company at their 3rd AGM held on September 09, 2023, have approved their appointment as Independent Directors w.e.f March 06, 2023, up to March 05, 2025

(iii) Your directors are pleased to inform that based on the recommendations of the Nomination and Remuneration Committee as well as Board of Directors, the shareholders by passing requisite resolutions through Postal Ballot/remote e-voting dated March 16, 2024, have approved the appointment of two directors i.e. (i) Mr. Anurag Dalmia as Non-Executive Director and (ii) Justice Ravindra Singh (Retd.) as Independent Director of the Company. Justice Ravindra Singh (Retd.) has been appointed for a period of two years. The effective date of appointment of Directors is April 01, 2024.

All Independent Directors have provided declarations confirming their independence and stating their ability to discharge their duties objectively and without external influence. Compliance with Section 149(6) of the Companies Act, 2013, and Regulation 16(1) (b) & Regulation 25(8) of the SEBI Listing Regulations is duly ensured. Additionally, no director is debarred from holding the office of director as per any SEBI order or or any other authority, as per the circular on the âenforcement of SEBI Order regarding appointment of directors by listed companiesâ dated June 20, 2018.

In the opinion of the Board, the Independent Directors on the Board of the Company possess the requisite qualifications, experience, expertise, proficiency and hold high standards of integrity in terms of Rule 8 of the Companies (Accounts) Rules, 2014.

(iv) Procedure for Nomination and Appointment of Directors

Detailed information regarding the nomination and appointment process of Directors, along with the list of core skills, expertise, and competencies of the Board of Directors, can be found in the Corporate Governance Report, which is included as part of the Annual Report. The Corporate Governance Report provides comprehensive insights into the governance practices of the company, ensuring transparency and accountability in the selection and composition of the Board of Directors.

(v) Familiarization program for Independent Directors:

The Company has a familiarisation programme for its Independent Directors. The objective of the programme is to familiarise the Independent Directors to enable them to understand the Company, its operations, business, industry and environment in which it functions and the regulatory environment applicable to it. At the time of appointment of a Director (including Independent Director), a formal letter of appointment is given to him, which inter alia explains the role, function, duties and responsibilities expected of him as a Director of the Company. The Director is also explained the compliance required from him / her under the Companies Act, 2013, Listing Regulations and other applicable laws. The management of the Company also has a one to one discussion with the newly appointed Director to familiarize him with the Companyâs operations. On the request of the individual director, site visits to various plant locations will be organized by the company for the directors to enable them to understand the operations of the company. Further, on an ongoing basis as a part of Agenda of Board & Committee meetings, presentation is regularly made on various matters inter alia covering the Companyâs business and operations, industry and regulatory updates.

(vi) Board Evaluation

In accordance with the Companies Act, 2013, SEBI Guidance Note on Board evaluation issued vide

SEBI Master Circular dated July 11, 2023, and the relevant provisions of the SEBI Listing Regulations, 2015, the Board of Directors conducted annual evaluation of its own performance, as well as that of its Committees and individual Directors. The evaluation process involved separate meetings of the independent directors and the Board as a whole.

The Board assessed the effectiveness of its functioning, the Committeesâ performance, and the individual Directorsâ contributions based on feedback gathered from Directors and committee members. The performance evaluation of the independent directors took place during Board meeting held on November 03, 2023, excluding the director being evaluated.

A dedicated meeting of the Independent Directors was conducted on October 26, 2023, to review the performance of non-independent Directors, the overall performance of the Board and its Committees. This evaluation considered input from both all the Directors.

To facilitate the evaluation process, an electronic application was utilized, ensuring secure and efficient data management while reducing paper usage. The criteria for performance evaluation were broadly based on the SEBI Guidance Note on Board Evaluation, encompassing aspects such as committee structure and composition, effectiveness of committee meetings, and more.

The performance evaluation of the Board and its constituents focused on various factors, including their functions, responsibilities, competencies, strategy, tone at the top, risk identification and control, diversity, and nature of the business. A comprehensive questionnaire was circulated to Board members, covering multiple aspects of the Boardâs functioning, culture, execution of duties, professional obligations, and governance. The questionnaire aimed to assess directorsâ knowledge, independence in decision-making, involvement in business planning, constructive engagement with colleagues, and understanding of the companyâs risk profile. Additionally, the Chairman of the Board and/ or committee was evaluated based on leadership, coordination, and steering skills.

The Nomination and Remuneration Committee reviewed the performance of individual Directors, considering their contributions as members of the Board or its committees. The committee determined the quantum of profit-based commission payable to directors based on the overall performance of individual directors.

These evaluation processes ensure that the Board operates effectively, individual Directors contribute significantly, and appropriate remuneration is provided based on performance.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 read with Section 2(51) of the Companies Act, 2013, the Board of Directors in its meeting held on March 6, 2023 has appointed Mr. R Balakrishnan, CEO of the Company, Mr. Gaurav V, CFO of the Company and Mr. Lalit Narayan Dwivedi, Company Secretary and Compliance Officer of the Company as the Key Managerial Personnel of the Company.

It is noteworthy that there have been no changes in the Key Managerial Personnel during the year. The continuity in the composition of the Key Managerial Personnel ensures stability and consistency in the management and operations of the company.

MANAGERIAL REMUNERATION &PARTICULARS OF EMPLOYEES

As per the provisions of Section 197(12) of the Companies Act, 2013, and Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement containing the names and other particulars of employees who receive remuneration exceeding the limits specified in the aforementioned rules is attached as Annexure I to this report. This statement provides the necessary information about such employees.

By providing these disclosures and statements, the Company ensures compliance with the relevant legal

provisions and transparency in reporting remuneration-related matters.

CONSTITUTION OF VARIOUS COMMITTEES OF THE BOARD OF DIRECTORS

Keeping in view of the changes in the Board composition and to strengthen corporate governance norms and in order to facilitate smooth business operations of the Company by delegation of the power of the Board to the Committees as per the legal requirement, the Board of Directors in its meeting held on March 6, 2023 has constituted the following Committees:

Sr. No.	Name of Committees
1	Audit Committee
2	Nomination & Remuneration Committee
3	Stakeholders Relationship Committee
4	Risk Management Committee
5	Corporate Social Responsibility Committee
6	Banking & Operations Committee

1. Audit Committee

The Board of Directors in its meeting held on March 06, 2023 had constituted the Audit Committee as per the requirement of Section 177 of the Companies Act, 2013 read with Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014, and Regulation 18 of the Listing Regulations. The primary purpose of the audit and compliance committee is to ensure effective supervision and monitoring of the managementâs financial reporting process, maintaining the highest standards of transparency, integrity, and quality.

As on 31, 2024, the committee is chaired by Dr. Manoj Vaish, with Mrs. Vijaylaxmi Joshi (Ex-IAS) and Mr. Arun Kumar Jain (Ex-IRS) serving as members. All members of the committee are independent directors with expertise in finance, accounts, strategy, tax, and general administration. During the financial year, the committee convened four meetings (April 12, 2023, August 07, 2023, November 03,2023 and February 03, 2024). Further details about the Audit committee can be found in the Corporate Governance Report at page no. 49-50.

2. Nomination & Remuneration Committee

The Board of Directors in its meeting held on March 06, 2023 had constituted the Nomination and Remuneration Committee as per the requirement of Section 178 of the Companies Act, 2013 and Regulation 19 of the Listing Regulations.

As on March 31, 2024, Nomination & Remuneration Committee comprises of three Independent Directors. The committee is chaired by Mrs. Vijaylaxmi Joshi (Ex-IAS) with Dr. Manoj Vaish and Mr. Arun Kumar Jain (Ex-IRS) serving as members. Further details about the committee can be found in the Corporate Governance Report at page no. 50-54.

3. Stakeholders Relationship Committee

The Board of Directors in its meeting held on March 06, 2023 had constituted the Stakeholders Relationship Committee as per the requirement of Section 178(5) of the Companies Act, 2013, and Regulation 20 of the Listing Regulations.

As on March 31, 2024, Stakeholders Relationship Committee comprises of Four Non-Executive Directors. The committee is chaired by Mr. Arun Kumar Jain (Ex-IRS) with Mr. R S Jalan, Mr. Raman Chopra, and Mr. Neelabh Dalmia serving as members of the committee. Further details about the committee can be found in the Corporate Governance Report at page no. 54-55.

4. Risk Management Committee

Provisions of Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for constitution of Risk Management Committee is applicable upon top 1000 Companies on the basis of market capitalization as at the end of the immediate preceding financial year, however, as a good governance practice, the Board of Directors in its meeting held on January 2, 2023 voluntarily formed a risk management policy to identify risk area of the business of the Company and Board of Directors in its meeting held on March 6, 2023 had constituted Risk Management Committee.

The committee is constituted with four NonExecutive directors, with Mr. Arun Kumar Jain (Ex-

IRS), Independent Director serving as the Chairman. The other members of the committee include Mr. R S Jalan, Mr. Raman Chopra and Mr. Neelabh Dalmia. Detailed information about the committee and its activities can be found in the Corporate Governance Report at page no. 57-58, of this Annual Report.

Your Company believes that various factors such as technological advancements, geopolitical environment, regulatory and environmental requirements have significant impacts on the business of the Company. To ensure sustainability, it is essential to systematically manage risks and seize opportunities arising from these factors. The Board of Directors holds the ultimate responsibility for risk oversight, while the Risk Management Committee provides guidance for implementing the risk management policy throughout the organization.

The operational heads of each business unit are primarily accountable for implementing the companyâs risk management policy and fostering a risk-aware culture that enhances performance. Senior executives in different functional units serve as risk owners, monitoring key risks and proactively implementing appropriate mitigation plans. Their role is to prevent any significant deviations or adverse events and contribute to value creation for the business. At present, in the opinion of the Board of Directors, there are no risks which may threaten the existence of the Company.

The Companyâs RiskManagement Policy, approved by the Board, can be accessed on the Companyâs website https://ghcltextiles.co.in/wp-content/ uploads/2023/02/Risk-Management-Policy.pdf

5. Corporate Social Responsibility Committee

As per Section 135 of the Companies Act, 2013 and rules made thereunder, a Company having Net worth of Rs. five hundred core or more or turnover of Rs. one thousand crore or more or net profit of Rs. Five crore rupees or more during the immediately preceding financial year shall constitute a CSR Committee, in term of above said conditions, the provision of Section 135 of the Companies Act, 2013 is not

applicable upon the Company as the Company was not doing any business till the Financial Year ended on March 31, 2023. However, as a good governance practice, Board of Directors in its Meeting held on January 2, 2023 had approved the Corporate Social Responsibility policy of the Company and Board of Directors in its Meeting held on March 6, 2023 had voluntary constituted the CSR Committee of the Company with four Non-Executive Directors. Mrs. Vijaylaxmi Joshi Independent Director serving as the Chairperson. The other members of the committee include Mr. R S Jalan, Mr. Raman Chopra and Mr. Neelabh Dalmia. Detailed information about the committee and its activities can be found in the Corporate Governance Report, at page no. 56-57 of this Annual Report.

6. Banking & Operations Committee

The Board of Directors in its meeting held on March 6, 2023 had constituted the Banking and Operations Committee to expedite the day to day functioning and exercise of delegated powers of the Board. This Committee meets as per the requirement of business, to expedite all matters relating to operations and granting authority for various functional requirements such as issue of Power of Attorney, arranging / negotiating of term loans, working capital loan, short term loan, dealings with Central / State Governments including their agents and various statutory / judicial / regulatory / local / commercial / excise / customs / port / sales tax / income tax / electricity board etc. and other authorities on behalf of the Company in line with the delegated authority of Board of Directors from time to time. The members of the committee include Mr. R S Jalan, Mr. Raman Chopra and Mr. Neelabh Dalmia, Non-Executive Directors of the Company.

NOMINATION AND REMUNERATION POLICY

The Board of Directors in its meeting held on January 2, 2023 has approved the Nomination and Remuneration Policy for Directors, Key Managerial Personnel (âKMPâ) and all other employees of the Company which was further amended by Board of Directors in its meeting held on February 03, 2024 on recommendation of

Nomination and Remuneration Committee. The Companyâs Nomination and Remuneration Policy and Practices have been formulated and maintained to meet inter-alia the following objectives:

1. To attract, retain and motivate qualified and competent individuals at Director, Key Managerial and other employee levels to carry out companyâs business operations as assigned to them.

2. To ensure payment of salaries and perks that are comparable to market salary levels so as to remain competitive in the industry.

3. To revise the remuneration of its employees periodically for their performance, potential and value addition after systematic assessment of such performance and potential.

4. To ensure disbursal of salary and perks in total compliance to the applicable statutory provisions and prevailing tax laws of the Country.

The Nomination and Remuneration Policy is available on website of the company https://ghcltextiles.co.in/ wp-content/uploads/2024/04/GHCL-Textiles-Limited-Nomination-and-Remunration-Policy.pdf

VIGIL MECHANISM / WHISTLE BLOWER POLICY

As a conscious and vigilant organization, GHCL Textiles Limited believes in the conduct of the affairs of its constituents in a fair and transparent manner, by adopting the highest standards of professionalism, honesty, integrity and ethical behavior. In its endeavor to provide its employee a secure and fearless working environment, GHCL Textiles Limited has established the âWhistle Blower Policyâ. The Board of Directors in its meeting held on January 2, 2023, had approved the Whistle Blower Policy.

The purpose of the policy is to create a fearless environment for the directors and employees to report any instance of unethical behaviour, actual or suspected fraud or violation of Companyâs code of conduct or Ethics Policy to the Ombudsperson and / or Chairperson of the Audit Committee. The Whistle Blower Policy is posted on the website of the Company www.ghcltextiles.co.in. There are no complaints reported during the year under Vigil mechanism.

DIVIDEND DISTRIBUTION POLICY

As per Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015, our companyâs Board of Directors formulated and adopted the Dividend Distribution Policy (DDP) in a meeting held on January 02, 2023. The policy has been established to ensure transparency and clarity in determining the quantum of dividends. It outlines the Boardâs commitment to maintaining a dividend pay-out ratio, which includes the dividend tax, in the range of 10% to 20% of profits after tax (PAT) on a standalone basis.

The Dividend Distribution Policy has been made available on our companyâs website at https:// ghcltextiles.co.in/wp-content/uploads/2023/02/ Dividend-Distribution-Policy.pdf It serves as a guiding framework for the Board of Directors when making decisions regarding the recommendation of dividends. The policy ensures a consistent approach to dividend pay outs and reinforces our commitment to delivering value to our shareholders.

DISCLOSURES AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company is deeply committed to creating and maintaining a safe and inclusive work environment where every individual is respected and protected from any form of harassment, exploitation, or intimidation. In line with this commitment and as mandated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (âPOSH Actâ) and its related Rules, your Company has established a comprehensive policy for the prevention of sexual harassment.

Under this policy, Internal Complaints Committees have been set up at all major locations of the Company. These committees are entrusted with the responsibility of addressing any complaints related to sexual harassment at the workplace. The committees operate with transparency, impartiality, and adherence to clear timelines, ensuring a fair and unbiased investigation process.

Your Company also conducts regular awareness programs to educate employees about their rights, the provisions of the POSH Act, and the available redressal mechanisms. These programs aim to build a culture of respect, sensitivity, and gender equality in the workplace.

We are pleased to inform you that no complaints related to sexual harassment were reported during the year under the POSH Act.

CHANGE IN NATURE OF BUSINESS

We would like to inform that Company has successfully started its business operation as per approved Scheme of Demerger of spinning business of GHCL Limited (Demerged Company) with GHCL Textiles Limited (Resulting Company), effective from April 01, 2023.

We would like to confirm that there is no material change in the nature of business of the Company during the period between April 1, 2024, and the date of signing this report.

SUBSIDIARIES, JOINT VENTURES & ASSOCIATES

We would like to inform that your Company is not having any subsidiary, joint venture or associate company as on March 31, 2024.

MANAGEMENT DISCUSSION & ANALYSIS

In accordance with Regulation 34 (2) (e) of the Listing Regulations, 2015, we would like to draw your attention to the comprehensive review of our companyâs operations, performance, and future outlook provided in the Managementâs Discussion and Analysis Report (MDA). This report is included as part of our Annual Report and is incorporated herein by reference.

The MDA offers detailed insights into the various aspects of our business, including market trends, financial performance, key achievements, challenges, and strategic initiatives. It provides a holistic view of our companyâs performance and outlines our managementâs perspective on the future prospects and opportunities.

We encourage you to refer to the MDA for a comprehensive understanding of our companyâs operations and outlook. It serves as a valuable resource for shareholders, investors, and stakeholders seeking in-depth analysis and assessment of our business performance.

CORPORATE GOVERNANCE

To enhance its governance framework, the Company has implemented several best practices. These practices encompass various aspects of governance, including board composition and structure, independent directors, board committees, risk management, internal controls, ethical conduct, and stakeholder engagement. By embracing these practices, the Company aims to ensure effective oversight, decision-making, and protection of the interests of all stakeholders.

Furthermore, the Company obtains a certificate from its auditors, affirming compliance with the conditions of Corporate Governance. This certificate serves as an independent validation of the Companyâs adherence to the prescribed governance norms.

By upholding strong Corporate Governance standards and implementing best practices, the Company aims to foster trust, integrity, and long-term sustainability. It recognizes that effective governance is essential for creating value and maintaining strong relationships with shareholders, employees, customers, suppliers, and other stakeholders.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

As per the revised Regulation 34(2)(f) of the Listing Regulations, 2015 and the National Guidelines on Responsible Business Conduct (NGRBC) issued by the

Ministry of Corporate Affairs, Government of India, the top one thousand listed companies are required to prepare and present a Business Responsibility and Sustainability Report Core (BRSR) to stakeholders.

Starting from the financial year 2022-2023, filing the BRSR has become mandatory for the top 1000 listed companies based on market capitalization, replacing the BRR. As of March 31, 2024, GHCL Textiles Limited is ranked on 1286th position at NSE and on 1369th position at BSE based on market capitalization, accordingly reporting of Business Responsibility and Sustainability Report Core (BRSR) as per Regulation 34(2)(f) of the Listing Regulations, 2015 is not applicable for FY 2023-24.

SECRETARIAL STANDARDS

During the financial year ended on March 31, 2024, the Company has complied with all the applicable provisions of Secretarial Standards issued by Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs of India.

AUDITORS AND AUDIT REPORTS

(i) Statutory Auditor

Your directors would like to inform that in the 1^st AGM held on June 18, 2021, M/s S. R. Batliboi & Co. LLP, Chartered Accountants (ICAI Firm Reg. No. 301003E / E300005), was appointed as statutory auditor of the Company for a period of five consecutive years i.e. from the conclusion of 1^st AGM till the conclusion of 6^th AGM.

M/s S. R. Batliboi & Co. LLP has audited the financial statement of the Company for the financial year ended March 31, 2024 and has issued the Auditorsâ Report thereon.

(ii) Cost Auditor

In accordance with Section 148 of the Companies Act, 2013, the Company maintains cost records as required, and a Cost Accountant conducts an audit of these records. The Board of Directors, based on the recommendation of the Audit Committee, has approved the appointment of M/s R J Goel & Co., Cost Accountants, New Delhi, as the Cost Auditor of the Company for the financial year ended on March 31, 2024.

(iii) Internal Auditor

As per provisions of Section 138 of the Companies Act, 2013, every Listed Company is required to appoint an Internal Auditor to conduct internal audit of the functions and activities of the company. The Board of Directors, based on the recommendation of the Audit Committee, has approved the appointment of M/s. R. Subramanian and Company LLP, Chartered Accountants, Chennai, as the Internal Auditor of the Company for the financial year ended on March 31, 2024 to conduct the internal audit of the activities of the Company.

(iv) Secretarial Auditor

Section 204 of the Companies Act, 2013 inter-alia requires every listed company to undertake Secretarial Audit and shall annex with its Boardâs Report a Secretarial Audit Report given by a Company Secretary in practice, in the prescribed form.

Post listing of shares of the Company on Stock Exchanges (i.e. June 12, 2023), GHCL Textiles Limited has adopted a practice of ongoing Secretarial Audit throughout financial year and placed its periodic Secretarial Audit Report before Audit Committee and Board. This has helped us in early detection of area of improvement and strengthening out level of compliance reporting.

In line with the requirement of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with Regulation 24A of the Listing Regulations and other applicable provisions, if any, the Board of Directors of the Company in its meeting held on August 07, 2023 had appointed Chandrasekaran Associates, Company Secretaries, New Delhi, to conduct Secretarial Audit of the Company for the financial year 2023-24. The Secretarial Audit Report as given by Secretarial Auditor of the Company is annexed with Boardâs Report as Annexure - II at page no. 27.

(v) Auditorâs Report

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in the Audit Reports

issued by them which call for any explanation/ comment from the Board of Directors.

Observations given by Secretarial Auditors of the Company for the financial year ended March 31, 2024 are self-explanatory and therefore, they do not require any further explanation or comment under Section 134(3)(f) of the Companies Act, 2013.

LISTING OF THE EQUITY SHARES

We are pleased to inform you that Companyâs equity shares are listed on BSE Limited and National Stock Exchange of India Limited w.e.f. June 12, 2023. We have paid the annual listing fees for the years 2023-24 and 2024-25 to both stock exchanges, ensuring our continued listing and trading.

WEB ADDRESS FOR ANNUAL RETURN AND OTHER POLICIES / DOCUMENTS

The Company has a fully functional website viz www. ghcltextiles.co.in. All the policies/documents are available on the website of the Company as per the statutory requirements.. In terms of Section 92(3) read with Section 134(3)(a) of the Act and rules thereto, the Annual Return of the Company in Form MGT - 7 for the financial year ended on March 31, 2024 is available on the Companyâs website at https://ghcltextiles.co.in/wp-content/uploads/2024/05/GHCL-Textiles-Annual-Return-FY2023-24.pdf.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO

RELATED PARTY TRANSATIONS

All related party transactions that were entered into during the financial year 2023-24 were on an armâs length basis and in the ordinary course of business and also taken place in implementation of Scheme of Demerger. Therefore,

the disclosure under Form AOC-2 is not applicable to the Company. Further there are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

PARTICULAR OF LOANS/GUARANTEES, OR INVESTMENTS

The details of loans, guarantees, and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to the Financial Statements. These notes offer comprehensive information regarding the nature, terms, and conditions of such loans, guarantees, and investments. They also include disclosures on any related party transactions, if applicable, and any significant developments or changes in these arrangements.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability confirm that:

a. in the preparation of the annual accounts for the financial year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied them consistently and made judgments and

estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2024 and of the profit and loss of the Company for the financial year ended March 31, 2024;

c. the proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the annual accounts for the financial year ended March 31, 2024 have been prepared by them on a going concern basis;

e. proper Internal financial controls have been followed by the company and that such internal financial controls are adequate and were operating effectively; and

f. proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

GENERAL DISCLOSURES

Your Directors state that no disclosure or reporting is

required in respect of the following matters as there is

no transaction on these items during the financial year

ended March 31, 2024: