Directors Report of Shanthala FMCG Products Ltd.

Mar 31, 2025

Your Directors have pleasure in presenting their 11^th Annual
Report on the Standalone and Consolidated Audited Statement of
Accounts of Shanthala FMCG Products Limited ["the Company"]
for the Financial Year ended March 31, 2025.

1. FINANCIAL RESULTS

The summarized financial performance of the Company for
the FY 2024-25 and FY 2023-24 is given below:

[Amount in Lakhs]

PARTICULARS	Standalone		Consolidated
	2024-25	2023-24	2024-25	2023-24
Revenue from operations	5274.62	4133.06	5274.62	4133.06
Other Income	103.15	53.85	103.15	53.85
Total Revenue	5377.77	4186.91	5377.77	4186.91
Total Expenses	5246.92	4148.93	5246.92	4148.93
Net Profit Before Tax	130.85	37.98	130.85	37.98
Provision for Tax
- Current Tax	33.02	10.09	33.02	10.09
- Deferred Tax	1.29	-0.47	1.29	-0.47
(Liability)/Assets
- Excess/(short)	0.00	-1.06	0.00	-1.06
provision for earlier years
Net Profit After Tax	96.53	29.42	96.53	29.42
Earnings per equity share
- Basic (In '')	1.44	0.67	1.44	0.67
- Diluted	1.44	0.67	1.44	0.67
(In '')

2. REVIEW OF OPERATIONS

Standalone and Consolidated:

During the financial year under review, the Company has
posted revenue from its operations of '' 5274.62 Lakhs as
against '' 4133.06 Lakhs for the corresponding previous year.

Further, the Company has earned a profit after tax of '' 96.53
Lakhs as against '' 29.42 Lakhs for the corresponding
previous year.

Note: Figures of Standalone and Consolidated accounts
are same as there were no significant operational/ financial
transactions carried out in our Wholly- Owned Subsidiary
Company, (STPL Commtrade Private Limited) during the
relevant period. For the financial year ended 31^st March,
2025, no amount was carried to General reserve account by
the Company.

3. STATE OF AFFAIRS AND FUTURE OUTLOOK:

Your Board is exploring new avenues to engage Company
into trading activities with present product line, with
an expectation to grow its business in upcoming year.
Moreover, the Company has witnessed upward trend in its
revenue and profit after tax. The Company is hopeful to do
better in upcoming future.

4. DIVIDEND AND RESERVES:

In order to conserve the profit for future years, the Company
do not recommend dividend for the financial year 2024-25.

5. SHARE CAPITAL

As on March 31, 2025, the authorized capital of the Company
was INR 11,00,00,000/- (Indian Rupees Eleven Crores only)
divided into 1,10,00,000 (One Crore Ten Lacs only) Equity
Shares of '' 10/- (Indian Rupees Ten Only) each. Further, the
issued, subscribed and paid-up share capital of the Company
was '' 6,69,80,640/- (Indian Rupees Six Crores Sixty Nine
Lacs Eighty Thousand Six Hundred and Forty only) divided
into 66,98,064 (Sixty Six Lacs Ninety Eight Thousand Sixty
Four Only) Equity Shares of '' 10/- (Indian Rupees Ten Only)
each.

And no changes were made in share capital during the
Financial year 2024-25.

6. MATERIAL CHANGES AND COMMITMENTS
AFFECTING FINANCIAL POSITION OF THE
COMPANY.

During the year, the Company incorporated a wholly owned
subsidiary in the name and style of M/S. STPL Commtrade
Private Limited by making an investment of '' 1,00,000/-
(Indian Rupees One Lakh only) being 10,000 (Ten Thousand)
Equity Shares of '' 10/- each (Indian Rupees Ten only).

The incorporation of this wholly owned subsidiary is part
of the Company''s broader strategic initiative to enhance its
operational footprint, diversify revenue streams, and explore
new markets and business verticals. Through this subsidiary,
the Company aims to leverage emerging opportunities,
strengthen its presence in key sectors, and create long-term
value for stakeholders. The move aligns with the Company''s

vision for sustainable growth and its commitment to increasing competitiveness through innovation, agility, and proactive business
development.

7. MANAGEMENT DISCUSSION AND ANALYSIS.

The Management Discussion and Analysis as required in terms of the Listing Regulations is annexed to the report as “Annexure 1“
and is incorporated herein by reference and forms an integral part of this report.

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

During the financial year under review, no changes were made in designations of Directors and Key Managerial Personnel:

The Composition of Directors and Key Managerial Personnel as on date is as follows:

Sr. No.	Name Of Directors/ KMP''s	DIN/Membership No	Designation
1	Mrs. Bantwal Shobitha Malya	06793259	Executive Director
2	Ms. Shivani Tiwari	09359208	Non -executive, Independent Director
3	Mr. Ravikant Mhatre	06362676	Non -executive, Independent Director
4	Ms. Smita Patil	10147488	Non -executive, Independent Director
5	Mr. Yogish Mallya B P	NA	Chief Financial Officer
6	Ms. Snehal Bhagwat	A68895	Company Secretary & Compliance Officer

> Demise of Chairman and Managing Director

Mr. B Manjunath Mallya (DIN: 06793251), Chairman and
Managing Director of the Company, passed away on July
08, 2025. This sad news was duly communicated to the NSE
through intimations dated July 08 and August 02, 2025.
Late Mr. Mallya was a cornerstone of the Company, whose
visionary leadership and unwavering dedication played a
pivotal role in its growth and success. The Board of Directors
deeply appreciates his invaluable contributions and tireless
service throughout his tenure. His legacy of integrity,
excellence, and inspirational leadership will continue to
guide and influence all who had the honor of working with
him. His presence, wisdom, and counsel will be profoundly
missed and forever remembered.

The untimely demise of Mr. B Manjunath Mallya is an
irreparable loss to the Company. The Board of Directors,
along with all employees, express their deepest sorrow and
extend their heartfelt condolences to his family. We stand
united in offering our support and sympathy to his loved
ones during this profoundly difficult period.

> Inductions / Appointment or Re-appointment of Director:

1. Pursuant to the provisions of Section 152 of the Act,
Mrs. Bantwal Shobitha Malya (DIN: 06793259) retires
by rotation at the ensuing Annual General Meeting and
being eligible, has offered herself for re-appointment.
The Board recommends her re-appointment.

2. Pursuant to the recommendation of the NRC, the Board
at its Meeting held on 23^rd August, 2025, considered
and approved:

- To change the designation of Mrs. Bantwal
Shobitha Malya (DIN: 06793259) from the position
of Executive Director to Managing Director for
a term of five years with effect from September
26, 2025 upto September 25, 2030, resolution in
this behalf is set out at Item No 03 of the Notice of
Annual General Meeting, for Members'' approval.

All the directors of the Company have confirmed that
they satisfy the fit and proper criteria as prescribed
under the applicable regulations and that they are not
disqualified from being appointed as directors in terms
of Section 164(2) of the Companies Act, 2013.

9. SEPARATE MEETING OF INDEPENDENT
DIRECTORS: BOARD EVALUATION &

DISCUSSIONS WITH INDEPENDENT
DIRECTORS:

Pursuant to paragraph VII of Schedule IV, in terms of Section
149 (8) of Companies Act, 2013 and Regulation 25 (3) & (4) of
Securities and Exchange Board of India (Listing Obligations
and Disclosure requirements, 2015, the Board''s policy
is to regularly have separate meetings with Independent
Directors, to update them on all business-related issues,
new initiatives and changes in the industry specific market
scenario. At such meetings, the Executive Directors and
other Members of the Management make presentations on
relevant issues.

Sr. No.	Name of Directors	Designation as on March 31, 2025	Date of Meeting - 19.02.2025
1	Mr. Ravikant Mhatre	Independent Director	Present
2	Ms. Shivani Tiwari	Independent Director	Present
3	Ms. Smita Patil	Independent Director	Present

Pursuant to the provisions of the Companies Act, 2013 and
the Listing Agreement/ SEBI (LODR) Regulations, 2015, the
Board has carried out an annual performance evaluation of
its own performance, the directors individually as well as the
evaluation of the working of its committees. The Directors
expressed satisfaction with the evaluation process.

10. DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received the necessary declaration from
each Independent Director in accordance with Section
149(7) of the Act and Regulations 16(1)(b) and 25(8) of the
SEBI Listing Regulations, that he/she meets the criteria of
independence as laid out in Section 149(6) of the Act and
Regulations 16(1)(b) of the SEBI Listing Regulations.

In the opinion of the Board, there has been no change in the
circumstances which may affect their status as Independent
Directors of the Company and the Board is satisfied of the
integrity, expertise, and experience (including proficiency
in terms of Section 150(1) of the Act and applicable rules
thereunder) of all Independent Directors on the Board.
Further in terms of Section 150 read with Rule 6 of the
Companies (Appointment and Qualification of Directors)
Rules, 2014, as amended, Independent Directors of the
Company have included their names in the data bank of
Independent Directors maintained with the Indian Institute
of Corporate Affairs.

11. COMPOSITION OF BOARD, NUMBER OF
BOARD MEETINGS & ITS POLICY:

The existing policy is having a blend of appropriate
combination of executive, non-executive and independent
directors to maintain the independence of the Board and
separate its functions of governance and management.
As of March 31, 2025, the Board had 5 (Five) members,
consisting of 2 (Two) executive Directors, 03 (Three) non¬
executive & independent director. Dates for Board Meetings
are well decided in advance and communicated to the Board
and the intervening gap between the meetings was within
the period prescribed under the Companies Act, 2013 and
the Listing Agreement. The information as required under

Regulation 17(7) read with Schedule II Part A of the LODR
is made available to the Board. The agenda and explanatory
notes are sent to the Board in advance.

The Board periodically reviews compliance reports of all
laws applicable to the Company. The Board meets at least
once a quarter to review the progress of business of the
Company and also to review half yearly financial results
and other items on the agenda and also on the occasion of
the Annual General Meeting (''AGM'') of the Shareholders.
Additional meetings are held, when necessary.

Further, Committees of the Board usually meet on the
same day of formal Board Meeting, or whenever the need
arises for transacting business. The recommendations of
the Committees are placed before the Board for necessary
approval and noting. During the Financial Year 2024-25,
the Company held 7 (Seven) board meetings of the Board
of Directors as per Section 173 of Companies Act, 2013
which is summarized below. The provisions of Companies
Act, 2013 was adhered to while considering the time gap
between two meetings.

Sr.	Date of Meetings	Board	No. of Directors
No.		Strength	Present
1	27-05-2024	5	5
2	02-08-2024	5	2
3	23-08-2024	5	5
4	01-10-2024	5	2
5	11-11-2024	5	4
6	27-01-2025	5	2
7	29-03-2025	5	3

Attendance details of Directors for the year ended March 31,
2025 are given below:

Name of the Directors	Category	No. of Board Meetings entitled to attend	No. of Board Meetings attended
Late Mr. B Manjunath Mallya	Chairman and Managing Director	7	7
Mrs. Bantwal Shobitha Mallya	Executive Director	7	5
Mr. Ravikant Mhatre	Independent & Non Executive Director	7	4
Ms. Shivani Tiwari	Independent & Non Executive Director	7	3
Ms. Smita Patil	Independent & Non Executive Director	7	4

12. FORMATION OF THE COMMITTEES OF THE
BOARD

AUDIT COMMITTEE

The Audit Committee of the Company is constituted in line
with the provisions of Regulation 18 of the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("SEBI ListingRegulations")
read with Section 177 of the Companies Act, 2013 ("Act").
The primary objective of the Audit Committee is to monitor
and provide an effective supervision of the Management''s
financial reporting process, to ensure accurate and timely
disclosures, with the highest levels of transparency, integrity
and quality of financial reporting. The Committee oversees
the work carried out in the financial reporting process by the
Management, the statutory auditor and notes the processes
and safeguards employed by each of them.

Meetings of the Committee were held during the year ended
31^st March, 2025, the dates of which are May 27, 2024,
August 02, 2024, November 11, 2024, January 27, 2025 and
March 29, 2025.

Details of Composition of the Committee:

Sr. No.	Name of Director	Position in committee	No. of Committee Meetings entitled to attend	No. of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	5	5
2	Ms. Shivani Tiwari	Member, Independent Director	5	4
3	Ms. Smita Patil	Member, Independent Director	5	5

NOMINATION & REMUNERATION COMMITTEE:

Your Company has formed a Nomination & Remuneration
Committee to lay down norms for determination of remuneration
of the executive as well as non-executive directors and executives
at all levels of the Company. The Nomination & Remuneration
committee has been assigned to approve and settle the
remuneration package with optimum blending of monetary and
non-monetary outlay.

During the year ended 31^st March, 2025, 1(One) meeting of the
Committee was held on August 23, 2024.

Details of Composition of the Committee:

Sr. No.	Name of Director	Position in committee	No. of Committee Meetings entitled to attend	No. of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	1	1
2	Ms. Shivani Tiwari	Member, Independent Director	1	1
3	Ms. Smita Patil	Member, Independent Director	1	1

Nomination and Remuneration Policy:

The Board of Directors has framed a policy which lays down
a framework in relation to remuneration of Directors. This
policy also lays down criteria for selection and appointment
of Board Members. The Board of Directors is authorized to
decide Remuneration to Executive Directors. The Remuneration
structure comprises of Salary and Perquisites. Salary is paid to
Executive Directors within the Salary grade approved by the
Members. The Nomination & Remuneration committee has been
assigned to approve and settle the remuneration package with
optimum blending of monetary and non-monetary outlay.

In terms of requirements prescribed under Section 178(3) of the
Companies Act, 2013, the Nomination and Remuneration Policy
inter-alia providing the terms for appointment and payment of
remuneration to Directors and Key Managerial Personnel.

During the year, there have been no changes to the Policy. The
same is annexed to this report as Annexure II and is available on
our website https://shanthalafmcg.com.

During the year under review, the details of remuneration paid to
Directors and Key Managerial Personnel are as under:

Sr. No.	Name of Director and KMP	Designation	Remuneration per annum (In '')
1	Late Mr. B Manjunath Mallya	Chairman and Managing Director	'' 18,00,000/-
2	Mrs. Bantwal Shobitha Malya	Director	'' 9,00,000/-
3	Snehal Bhagwat	Company Secretary and Compliance Officer	'' 5,85,000/-

STAKEHOLDERS RELATIONSHIP COMMITTEE:

The terms of reference are in line with Section 178 of the
Companies Act, 2013 and Regulation 20 of Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015. The Committee reviews
Shareholder''s/Investor''s complaints like non-receipt of Annual
Report, physical transfer/ transmission/transposition, split/
consolidation of share certificates, issue of duplicate share
certificates etc. This Committee is also empowered to consider
and resolve the grievance of other stakeholders of the Company
including security holders.

Meeting of the Committee held during the year ended 31^st March,
2025, the date of which is February 19, 2025.

Details of the composition of the Committee and attendance
during the year are as under:

Sr. No.	Name of Director	Category	No. of Committee Meetings entitled to attend	No. of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	1	1
2	Ms. Shivani Tiwari	Member, Independent Director	1	1
3	Ms. Smita Patil	Member, Independent Director	1	1
4	Late Mr. B Manjunath Mallya	Member, Managing Director	1	1

The details of complaints received and resolved during the
Financial Year ended March 31, 2025 are given in the Table below.

The complaints relate to non-receipt of annual report, dividend,
share transfers, other investor grievances, etc.

Details of complaints received and resolved during the Financial
Year 2024-25:

Particulars	No. of complaints
Opening as on April 1, 2024	0
Received during the year	0
Resolved during the year	0
Closing as on March 31, 2025	0

13. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies
Act, 2013, the Board of Directors of the Company hereby
confirm that:

(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;

(b) the Directors have selected such accounting policies
and applied them consistently and made judgments
and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the
Company at the end of the financial year and of the
profit and loss of the company for that period;

(c) the Directors have 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 have prepared the annual accounts on a
''going concern'' basis;

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

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

14. CODE FOR PROHIBITION OF INSIDER
TRADING

Your Company has adopted the Internal Code of conduct for
Regulating, monitoring and reporting of trades by Designated
persons under the Securities and Exchange Board of India
(Prohibition of Insider Trading) Regulation, 2015 ("Code")
for prohibition of insider trading in the securities of the
SHANTHALA to curb the practice for dealing in the securities
while having Unpublished Price Sensitive Information
("UPSI") by the Insiders of the Company.

The Code, inter alia, prohibits dealing in securities by
insiders while in possession of unpublished price sensitive
information. The said Code has been amended, from time to
time, to give effect to the various notifications/circulars of
Securities and Exchange Board of India ("SEBI") with respect
to the SEBI (Prohibition of Insider Trading) Regulations,
2015.

Your Company has also formulated and adopted the Policy
and Procedures for inquiry in case of leak or suspected

leak of Unpublished Price Sensitive Information [Under
Regulation 9A (5) of Securities and Exchange Board of India
(Prevention of Insider Trading) Regulations, 2015].

15. PARTICULARS OF EMPLOYEES AND RELATED
DISCLOSURES

The information required pursuant to Section 197 read with
Rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Amendment Rules, 2016 in respect of
employees of the Company, is enclosed as “Annexure III" and
forms an integral part of this report.

Further, as per the provisions specified in Chapter XIII of
Companies (Appointment & Remuneration of Managerial
Personnel) Amendment Rules, 2016, none of the employees
of the Company are in receipt of remuneration exceeding
'' 1,02,00,000/- per annum, if employed for whole of the
year or '' 8,50,000/- per month if employed for part of the
year.

16. ANNUAL RETURN:

Pursuant to Notification dated 28^th August, 2020 issued by
the Ministry of Corporate Affairs as published in the Gazette
of India on 28^th August, 2020, the details forming part of
the extract of Annual Return in Form MGT-9 is not required
to be annexed herewith to this report. However, the Annual
Return will be made available at the website of the Company
at: https://shanthalafmcg.com.

17. DETAILS OF SUBSIDIARY/ HOLDING/ JOINT
VENTURES/ ASSOCIATE COMPANIES:

The Company does not have any Holding company, Joint
venture or Associate Company.

Subsidiary company:

The company has a wholly owned subsidiary company and
holds 100% of the Equity Share Capital of that Company viz.,
in M/s. STPL Commtrade Private Limited (WOS) with effect
from August 30, 2024.

During the year, the Board of Directors reviewed the affairs
of the subsidiaries. Pursuant to the provisions of section
129(3) of the Companies Act, 2013 read with Rule 5 of the
Companies (Accounts) Rules, 2014, a statement containing
the salient features of the financial statements of the
Company''s subsidiaries in Form No. AOC-1 is appended as
Annexure - IVto this Report. The statement also provides the
details of performance and financial position of subsidiary.

18. STATUTORY AUDITORS'' AND AUDITORS''
REPORT:

At the Annual General Meeting held on 18^th July, 2023, the
Company has appointed M/s. Kale Malde & Co. Chartered
Accountants, bearing ICAI Registration Number: 154422W,
as the Statutory Auditors of the Company for a period of five

years from the conclusion of 9^th AGM till the conclusion of
the 14^th AGM.

Auditors Report as issued by M/s. Kale Malde & Co..,
Chartered Accountants, Auditors of the Company is self¬
explanatory and need not call for any explanation by your
Board.

19. SECRETARIAL AUDIT:

Pursuant to Section 204 of the Companies Act, 2013 and the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, made there under, mandate
the company to have Company Secretary in practice for
furnishing secretarial audit report, accordingly, M/s Deep
Shukla & Associates have been appointed as Secretarial
Auditors of the Company. The Board of Directors of your
SHANTHALA had already appointed M/s. Deep Shukla
& Associates, Practicing Company Secretaries, Mumbai,
a peer-reviewed firm, to act as the Secretarial Auditor.
The Secretarial Audit Report for the financial year ended
31^st March 2025, as required under Section 204 of the Act.

The Secretarial Auditors'' Report is enclosed as Annexure V
to the Board''s report, which forms part of this Integrated
Annual Report.

20. INTERNAL AUDIT & CONTROLS:

The Company has in place adequate internal financial
controls with reference to the financial statement. During
the year, such controls were tested and no reportable
material weakness in the design or operation was noticed.
The Audit Committee of the Board periodically reviews the
internal control systems with the management and Statutory
Auditors.

The Board of Directors of your SHANTHALA has appointed,
M/s. Kalpesh Khatri & Associates, Chartered Accountants
(Firm Regn No: 0139570W) as the company''s internal
auditor for period of 2 financial years commencing from the
F.Y 2024-25 to financial year ending 2025-26.

21. EMPLOYEES'' STOCK OPTION PLAN:

The Company has not provided stock options to any
employee.

22. VIGIL MECHANISM:

In pursuant to the provisions of sections 177(9) & (10) of the
Companies Act, 2013, a Vigil Mechanism for Directors and
employees to report genuine concerns has been established.
The Vigil Mechanism Policy has been uploaded on the
website of the Company at https://shanthalafmcg.com. The
employees of the Company are made aware of the said
policy at the time of joining the Company.

23. RISK MANAGEMENT POLICY:

The Company has laid down the procedure to inform
the Board about the risk assessment and minimization
procedures. These procedures are reviewed by the Board
annually to ensure that there is timely identification and
assessment of risks, measures to mitigate them, and
mechanisms for their proper and timely monitoring and
reporting.

The Company does not fall under the ambit of the top
1000 listed entities, determined on the basis of market
capitalization as at the end of the immediately preceding
financial year. Hence, compliance under Regulation 21 of
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 is not applicable.

24. CORPORATE GOVERNANCE REPORT:

Your Company is committed to achieving and adhering to
the highest standards of Corporate Governance. However,
the provisions of Corporate Governance are not applicable
to the Company pursuant to Regulation read with Regulation
15(2)(b) of the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations,
2015.

However, your Company undertakes that when the above
said provision is applicable to the Company the same will be
duly complied with in the period of 6 months.

25. DEPOSITS:

The Company has neither accepted nor renewed any fixed
deposits during the year under review under Section 76 of
the Companies Act, 2013. There are no unclaimed deposits,
unclaimed / unpaid interest, refunds due to the deposit
holders or to be deposited to the Investor Education and
Protection Fund as on March 31, 2025.

26. LOANS & GUARANTEES:

During the year under review, the Company has not provided
any loan, guarantee, security or made any investment covered
under the provisions of Section 186 of the Companies Act,
2013, to any person or other body corporate.

27. RELATED PARTY TRANSACTIONS:

Related party transactions, if any, that were entered into
during the period ended March 31, 2025, were on an arm''s
length basis and were in the ordinary course of business,
details of which are provided in the notes to Accounts of
the Company. 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.

None of the Directors has any pecuniary relationships or
transactions vis-a-vis the Company.

Further all the necessary details of transaction entered with
the related parties pursuant to provisions of Section 188(1)
of the Companies Act, 2013 are attached herewith in Form
AOC-2 for your kind perusal and information. (Annexure: VI).

28. CONSERVATION OF ENERGY, RESEARCH AND
DEVELOPMENT, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE:

The details of conservation of energy, technology absorption,
foreign exchange earnings and outgo are as follows:

(a) Conservation of Energy:

The use of energy is being optimized through improved
operational methods. Continuous efforts are being
made to optimize and conserve energy by improvement
in production process. Even though its operations are
not energy intensive, significant measures are taken to
reduce energy consumption by using energy- efficient
equipment. The Company regularly reviews power
consumption patterns in its all locations and implements
requisite improvements/changes in the process in order
to optimize energy/ power consumption and thereby
achieve cost savings.

Steps taken for utilizing alternate sources of energy;

The Company has not made any investment for utilizing
alternate source of energy;

Capital investment on energy conservation equipment;

The Company has taken adequate measures to conserve
energy by way of optimizing usage of power.

(b) Absorption of Technology:

The efforts made towards technology absorption:

In this era of competition, in order to maintain and
increase the number of clients and customers, we
need to provide the best quality services to our
clients and customers at a minimum cost, which is not
possible without innovation, and adapting to the latest
technology available in the market for providing the
services.

The Company has not imported any technology during
the year under review;

The Company has not expended any expenditure
towards Research and Development during the year
under review.

(c) Foreign Exchange Earnings and Outgo:

During the year under review, there was no earning or
outgoing in foreign exchange

29. CORPORATE SOCIAL RESPONSIBILITY:

The Company is committed to discharging its social
responsibility as a good corporate citizen. As per the Financial
Statements for the period under review, the provisions of
Section 135 of Companies Act, 2013 are not applicable
to the Company for the F.Y. 2024-25. Consequently, the
Company is not required to formulate the Corporate Social
Responsibility (CSR) Committee.

30. COST AUDIT / COST RECORDS:

As per the Cost Audit Orders and in terms of the provisions
of Section 148 and all other applicable provisions of the
Companies Act, 2013, read with the Companies (Audit and
Auditors) Rules, 2014, Cost Audit and Cost Records are not
applicable to our Company.

31. OBLIGATION OF COMPANY UNDER THE
SEXUAL HARASSMENT OF WOMEN AT
WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013:

The Company has in place an Anti-Sexual Harassment Policy
in line with the requirements of the Sexual Harassment at
Workplace (Prevention, Prohibition, and Redressal) Act,
2013. All employees (permanent, contractual, temporary,
trainees) are covered under this policy. During the year
ended 31^st March 2025, Company has not received any
complaint of harassment.

During the year ended 31^st March, 2025, there were no cases
filed /reported pursuant to the Sexual Harassment of women
at workplace (Prevention, Prohibition and Redressal) Act,
2013 and the details are mentioned below.

Number of Complaints of Sexual harassment received in the year	NIL
Number of Complaints disposed off during the year	NIL
Number of Cases pending for more than ninety days	NIL
Nature of action taken by employer or District officer	NIL
Number of Cases filed	NIL

32. MATERNITY BENEFIT COMPLIANCE:

During the year under review, the Company has complied
with the provisions relating to Maternity Benefits Act,
1961 and relevant rules thereunder. The Company provides
maternity leave and benefits to eligible female employees
and ensures a safe and inclusive work environment.

33. SECRETARIAL STANDARDS:

The Company has in place proper systems to ensure
compliance with the provisions of the applicable secretarial
standards issued by The Institute of Company Secretaries
of India and such systems are adequate and operating
effectively.

34. SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS:

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

35. ACKNOWLEDGEMENT:

The Directors would like to thank all shareholders,
customers, bankers, suppliers and everybody else with
whose help, cooperation and hard work the Company is able
to achieve the results. The Directors would also like to place
on record their appreciation of the dedicated efforts put in
by the employees of the Company.

ON BEHALF OF THE BOARD OF DIRECTORS
SHANTHALA FMCG PRODUCTS LIMITED

Sd/- Sd/-

Ravikant Mhatre Shobitha Malya

Director Director

(DIN:06362676) (DIN:06793259)

Date: 23/08/2025

Registered Address:

7^th Block, Gandhinagar Bye Pass Road,

Virajpet, Kodagu - 571218,

Karnataka, India.

---

Mar 31, 2024

Your directors are pleased to present the 10thAnnual Report
of the business and operations of your Company (hereinafter
referred to as the said "Company" or "SHANTHALA") accompanied
with AuditedFinancial Statements for the Financial Year ended on
March 31, 2024. The standalone performance of the Company
hasbeen considered whenever required.

1. FINANCIAL RESULTS

The summarized financial performance for the financial year
under review compared to the previous financial year is
given here-in-below:

[Amount in Lakhs]

PARTICULARS	2023-24	2022-23
Revenue from operation	4133.06	4051.59
Other income	53.85	25.65
Total income	4186.91	4077.25
Total Expenditure	4148.93	4051.00
Profit / (Loss) Before Tax	37.98	26.25
Tax Expenses:
Current Tax Expenses	10.09	8.46
Current Tax Expenses relating to prior years	(1.06)	0.00
Deferred tax liability	(0.47)	0.06
Net Profit/ (Loss) After Tax	29.42	17.73
Earnings per equity share - Basic and diluted	0.67	31.56

2. REVIEW OF OPERATIONS

During the financial year under review, the Company has
posted revenue from its operations of INR 41,33,05,861/- as
against INR 40,51,59,384/- for the corresponding previous
year.

Further, the Company has earned a profit after tax of
INR 29,42,173/- as against INR 17,72,509/- for the
corresponding previous year.

For the financial year ended 31^st March, 2024, no amount
was carried to General reserve account by the Company.

3. STATE OF AFFAIRS AND FUTURE OUTLOOK:

Your Board is exploring new avenues to engage Company
into trading activities with present product line, with an
expectation to grow its business in upcoming year. Moreover,
the Company has witnessed upward trend in its revenue
and profit after tax. The Company is hopeful to do better in
upcoming future.

4. DIVIDEND AND RESERVES:

In order to conserve the profit for future years, the company
do not recommend dividend for the financial year 2023-24.

5. SHARE CAPITAL

< Changes in Paid up Capital:

1. The company has on 27^th May, 2023, allotted fully
paid-up 1,16,458 (One Lakh Sixteen Thousand Four
Hundred Fifty Eight) Equity Shares of face value of
INR 10/- (Indian Rupees Ten only) each on preferential
issue basis to the respective allottees which was
approved by way of special resolution at the Extra¬
ordinary General meeting held on 20^th April, 2023 by
the members of the Company.

2. Further, on 18^th July, 2023, the Company has allotted
43,15,206 (Forty Three Lacs Fifteen Thousand Two
Hundred and Six) Equity Shares through bonus issue
to the existing shareholders vide members approval in
the Extra- Ordinary General Meeting of the Company
on 18^th July, 2023 in the ratio of 7 new equity shares for
every 1 shares held of INR 10.00 (Indian Rupees Ten
Only) each to the shareholders whose names appear
in the Register of Members as on the record date i.e.,
14^th July, 2023.

3. The Company has issued and allotted 17,66,400 equity
share of INR 10/- each at a price of INR 91/- per share
through an Initial Public Offer on 01^st November, 2023.

As on March 31, 2024, the authorized capital of the
company was INR 11,00,00,000/- (Indian Rupees
Eleven Crores only) divided into 1,10,00,000 (One
Crore Ten Lacs only) Equity Shares of INR 10/- (Indian
Rupees Ten Only) each.

Further, the issued, subscribed and paid-up share
capital of the Company was INR 6,69,80,640/- (Indian
Rupees Six Crores Sixty Nine Lacs Eighty Thousand Six
Hundred and Forty only) divided into 66,98,064 (Sixty
Six Lacs Ninety Eight Thousand Sixty Four Only) Equity
Shares of INR 10/- (Indian Rupees Ten Only) each.

6. MATERIAL CHANGES AND COMMITMENTS
AFFECTING FINANCIAL POSITION OF THE
COMPANY.

a. Change in the nature of the business of the Company

1. The Board of Directors at their meeting held on
April 03, 2023, approved Shifting of Registered
office of the Company within local limits of the
city i.e., from D.No.193, 14, Race Course Road,
Madikere, Kodagu - 571201, Karnataka, India to
7^th Block, Gandhinagar Bye Pass Road, Virajpet,
Kodagu- 571218, Karnataka, India, w.e.f. 7^th April,
2023.

2. During the financial year under review, there has
been no change in the nature of the business of
the Company. As per the special resolution passed
by the members of the Company at the Extra¬
ordinary General Meeting held on June 12, 2023,
approved the conversion of the Company from
a Private Limited Company to a Public Limited
Company and altered its Articles of Association
(AoA) and Memorandum of Association (MoA).
Consequently, the Company''s name was changed
from ''SHANTHALA FMCG PRODUCTS PRIVATE
LIMITED'' to ''SHANTHALA FMCG PRODUCTS

LIMITED'', by removing the word "Private" before
the word "Limited".

b. Initial Public Offer (“IPO”) and Listing

Pursuant to Section 23 (1) of the Companies Act, 2013
and other provision under the said Act and rules made
thereunder read with chapter IX of the securities and
exchange board of India (issue of capital and disclosure
requirements) regulations, 2018 ("SEBI (ICDR)
regulations"), as amended in terms of rule 19(2)(b) of the
securities contracts (regulation) rules, 1957 had made
Initial Public Offer aggregating to INR 1607.42 Lakhs
("Issue Size") and has issued and allotted 17,66,400
equity share of INR 10/- each at a price of INR 91/- per
share through an Initial Public Offer. Furthermore, the
Equity Shares of your Company were listed on National
Stock Exchange of India Limited on Small, Medium
Enterprise ("SME") on Thursday, November 03, 2023.

7. MANAGEMENT DISCUSSION AND ANALYSIS.

The Management Discussion and Analysis as required in
terms of the Listing Regulations is annexed to the report
as “Annexure I“ and is incorporated herein by reference and
forms an integral part of this report.

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

During the financial year under review, the following changes took place:
Appointments and change in designations of Directors and Key Managerial Personnel:

Sr. No.	Name Of Directors/ KMP''s	DIN/Membership No	Date of Appointment	Designation
1	Ms. Shivani Tiwari	09359208	May 09, 2023	Additional, Non -executive Director
			June 12, 2023	Change in designation as Non -executive, Independent Director
2	Mr. Ravikant Mhatre	06362676	May 09, 2023	Additional, Non -executive Director
			June 12, 2023	Change in designation as Non -executive, Independent Director
3	Ms. Smita Patil	10147488	May 09, 2023	Additional, Non -executive Director
			June 12,2023	Change in designation as Non -executive, Independent Director
4	Mr. Yogish Mallya B P	NA	May 09, 2023	Chief Financial Officer
5	Ms. Snehal Bhagwat	A68895	June 01, 2023.	Company Secretary & Compliance Officer
6	Mr. B Manjunath Mallya	06793251	July 18, 2023	Change in designation as Chairman and Managing Director
7	Mrs. Bantwal Shobitha Mallya	06793259	July 18, 2023	Change in designation as Executive Director

In accordance with section 152(6) of the Companies Act, 2013
and in terms of Articles of Association of the Company Mrs.
Bantwal Shobitha Mallya [DIN: 06793259], Director (Executive
Director) of the Company, retires by rotation and being
eligible; offers himself for re-appointment at the forthcoming
10^th Annual General Meeting. The Board recommends the said
reappointment for shareholders'' approval.

All the directors of the Company have confirmed that they satisfy
the fit and proper criteria as prescribed under the applicable
regulations and that they are not disqualified from being appointed
as directors in terms of Section 164(2) of the Companies Act,
2013.

Further, Pursuant to Section 203 of the Companies Act, 2013,
the Key Managerial Personnel of the Company are:

Sr. No.	Name of KMP	Designation
1	Mr. Bantwal Manjunath Mallya	Chairman and Managing Director
2	Mr. Yogish Mallya B P	Chief Financial Officer
3	Ms. Snehal Bhagwat	Company Secretary & Compliance Officer

9. SEPARATE MEETING OF INDEPENDENT
DIRECTORS: BOARD EVALUATION &

DISCUSSIONS WITH INDEPENDENT
DIRECTORS:

Pursuant to paragraph VII of Schedule IV, in terms of Section
149 (8) of Companies Act, 2013 and Regulation 25 (3) & (4) of
Securities and Exchange Board of India (Listing Obligations
and Disclosure requirements, 2015, the Board''s policy
is to regularly have separate meetings with Independent
Directors, to update them on all business-related issues,
new initiatives and changes in the industry specific market
scenario. At such meetings, the Executive Directors and
other Members of the Management make presentations on
relevant issues.

Sr. No.	Name of Directors	Designation as on March 31, 2024	Date of Meeting - 18.03.2024
1	Mr. Ravikant Mhatre	Independent Director	Present
2	Ms. Shivani Tiwari	Independent Director	Present
3	Ms. Smita Patil	Independent Director	Present

Pursuant to the provisions of the Companies Act, 2013 and
the Listing Agreement/ SEBI (LODR) Regulations, 2015, the
Board has carried out an annual performance evaluation of
its own performance, the directors individually as well as the

evaluation of the working of its committees. The Directors
expressed satisfaction with the evaluation process.

10. DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received the necessary declaration from
each Independent Director in accordance with Section
149(7) of the Act and Regulations 16(1)(b) and 25(8) of the
SEBI Listing Regulations, that he/she meets the criteria of
independence as laid out in Section 149(6) of the Act and
Regulations 16(1)(b) of the SEBI Listing Regulations.

In the opinion of the Board, there has been no change in the
circumstances which may affect their status as Independent
Directors of the Company and the Board is satisfied of the
integrity, expertise, and experience (including proficiency
in terms of Section 150(1) of the Act and applicable rules
thereunder) of all Independent Directors on the Board.
Further in terms of Section 150 read with Rule 6 of the
Companies (Appointment and Qualification of Directors)
Rules, 2014, as amended, Independent Directors of the
Company have included their names in the data bank of
Independent Directors maintained with the Indian Institute
of Corporate Affairs.

11. COMPOSITION OF BOARD, NUMBER OF
BOARD MEETINGS & ITS POLICY:

The existing policy is having a blend of appropriate
combination of executive, non-executive and independent
directors to maintain the independence of the Board and
separate its functions of governance and management. As of
March 31, 2024, the Board had 5 (Five) members, consisting
of 2 (Two) executive Directors, 03 (Three) non-executive &
independent director. Dates for Board Meetings are well
decided in advance and communicated to the Board and the
intervening gap between the meetings was within the period
prescribed under the Companies Act, 2013 and the Listing
Agreement. The information as required under Regulation
17(7) read with Schedule II Part A of the LODR is made
available to the Board. The agenda and explanatory notes are
sent to the Board in advance.

The Board periodically reviews compliance reports of all laws
applicable to the Company. The Board meets at least once a
quarter to review the progress of business of the Company
and also to review half yearly financial results and other
items on the agenda and also on the occasion of the Annual
General Meeting (''AGM'') of the Shareholders. Additional
meetings are held, when necessary.

Further, Committees of the Board usually meet on the
same day of formal Board Meeting, or whenever the need
arises for transacting business. The recommendations of
the Committees are placed before the Board for necessary
approval and noting. During the Financial Year 2023-24, the

Company held 15 (Fifteen) board meetings of the Board of
Directors as per Section173 of Companies Act, 2013 which
is summarized below. The provisions of Companies Act, 2013
was adhered to while considering the time gap between two
meetings.

Sr. No.	Date of Meetings	Board Strength	No. of Directors Present
1	03-04-2023	2	2
2	19-04-2023	2	2
3	09-05-2023	2	2
4	27-05-2023	5	2
5	02-06-2023	5	2
6	30-06-2023	5	2
7	14-07-2023	5	2
8	18-07-2023	5	2
9	04-09-2023	5	2
10	16-10-2023	5	2
11	17-10-2023	5	2
12	23-10-2023	5	2
13	01-11-2023	5	2
14	23-11-2023	5	5
15	19-03-2024	5	3

Attendance details of Directors for the year ended
March 31, 2024 are given below:

Name of the Directors	Category	No. of Board Meetings entitled to attend	No. of Board Meetings attended
Mr. B Manjunath Mallya	Chairman and Managing Director	15	15
Mrs. Bantwal Shobitha Mallya	Executive Director	15	15
Mr. Ravikant Mhatre	Independent & Non Executive Director	12	2
Ms. Shivani Tiwari	Independent & Non Executive Director	12	1
Ms. Smita Patil	Independent & Non Executive Director	12	1

12. FORMATION OF THE COMMITTEES OF THE
BOARD

AUDIT COMMITTEE

The Audit Committee of the Company is constituted in line
with the provisions of Regulation 18 of the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (“SEBI Listing Regulations”)
read with Section 177 of the Companies Act, 2013 (“Act”).

The primary objective of the Audit Committee is to monitor

and provide an effective supervision of the Management''s
financial reporting process, to ensure accurate and timely
disclosures, with the highest levels of transparency, integrity
and quality of financial reporting. The Committee oversees
the work carried out in the financial reporting process by the
Management, the statutory auditor and notes the processes
and safeguards employed by each of them.

Meetings of the Committee were held during the year ended
31^st March, 2024, the dates of which are July 18, 2023,
October 16, 2023, November 23, 2023 and March 19, 2024.

Details of Composition of the Committee:

Sr. No.	Name of Director	Position in committee	No. of Committee Meetings entitled to attend	No. of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	4	4
2	Ms. Shivani Tiwari	Member, Independent Director	4	4
3	Ms. Smita Patil	Member, Independent Director	4	4

NOMINATION & REMUNERATION COMMITTEE:

Your Company has formed a Nomination & Remuneration
Committee to lay down norms for determination of remuneration
of the executive as well as non-executive directors and executives
at all levels of the Company. The Nomination & Remuneration
committee has been assigned to approve and settle the
remuneration package with optimum blending of monetary and
non-monetary outlay.

During the year ended 31^st March, 2024, 1(One) meeting of the
Committee was held on March 19, 2024.

Details of Composition of the Committee:

Sr. No.	Name of Director	Position in committee	No. of Committee Meetings entitled to attend	No. of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	1	1
2	Ms. Shivani Tiwari	Member, Independent Director	1	1
3	Ms. Smita Patil	Member, Independent Director	1	1

Nomination and Remuneration Policy:

The Board of Directors has framed a policy, as detailed
in Annexure V, which lays down a framework in relation to
remuneration of Directors. This policy also lays down criteria
for selection and appointment of Board Members. The Board
of Directors is authorized to decide Remuneration to Executive
Directors. The Remuneration structure comprises of Salary
and Perquisites. Salary is paid to Executive Directors within
the Salary grade approved by the Members. The Nomination &
Remuneration committee has been assigned to approve and settle
the remuneration package with optimum blending of monetary
and non-monetary outlay.

Sr. .. Name of Director No.	Designation	Remuneration per annum (In '')
1 Mr. B Manjunath	Chairman and	'' 18,00,000/-
Mallya	Managing Director
2 Mrs. Bantwal	Director	'' 9,00,000/-
Shobitha Mallya

STAKEHOLDERS RELATIONSHIP COMMITTEE:

The terms of reference are in line with Section 178 of the
Companies Act, 2013 and Regulation 20 of Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015. The Committee reviews
Shareholder''s/Investor''s complaints like non-receipt of Annual
Report, physical transfer/ transmission/transposition, split/
consolidation of share certificates, issue of duplicate share
certificates etc. This Committee is also empowered to consider
and resolve the grievance of other stakeholders of the Company
including security holders.

Meeting of the Committee held during the year ended 31^st March,
2024, the date of which is March 19, 2024.

Details of the composition of the Committee and attendance
during the year are as under:

Sr. No.	Name of Director	Category	No. of Committee Meetings entitled to attend	No of meetings attended
1	Mr. Ravikant Mhatre	Chairperson, Independent Director	1	1
2	Ms. Shivani Tiwari	Member, Independent Director	1	1
3	Ms. Smita Patil	Member, Independent Director	1	1

Sr. No.	Name of Director	Category	No. of Committee Meetings entitled to attend	No of meetings attended
4	Mr. B	Member,	1	1
	Manjunath	Managing
	Mallya	Director

The details of complaints received and resolved during the
Financial Year ended March 31, 2024 are given in the Table below.

The complaints relate to non-receipt of annual report, dividend,
share transfers, other investor grievances, etc.

Details of complaints received and resolved during the Financial
Year 2023-24:

Particulars	No. of complaints
Opening as on April 1, 2023	0
Received during the year	0
Resolved during the year	0
Closing as on March 31, 2024	0

13. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies

Act, 2013, the Board of Directors of the Company hereby

confirm that:

(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;

(b) the directors have selected such accounting policies
and applied them consistently and made judgments
and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the
Company at the end of the financial year and of the
profit and loss of the company for that period;

(c) the directors have 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 have prepared the annual accounts on a
''going concern'' basis;

(e) the directors have laid down internal financial controls
to be followed by the Company and that such internal
financial controls are adequate and were operating
effectively.

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

14. CODE FOR PROHIBITION OF INSIDER
TRADING

Your Company has adopted the Internal Code of conduct for
Regulating, monitoring and reporting of trades by Designated
persons under the Securities and Exchange Board of India
(Prohibition of Insider Trading) Regulation, 2015 ("Code")
for prohibition of insider trading in the securities of the
SHANTHALA to curb the practice for dealing in the securities
while having Unpublished Price Sensitive Information
("UPSI") by the Insiders of the Company.

The Code, inter alia, prohibits dealing in securities by
insiders while in possession of unpublished price sensitive
information. The said Code has been amended, from time to
time, to give effect to the various notifications/circulars of
Securities and Exchange Board of India ("SEBI") with respect
to the SEBI (Prohibition of Insider Trading) Regulations,
2015.

Your Company has also formulated and adopted the Policy
and Procedures for inquiry in case of leak or suspected
leak of Unpublished Price Sensitive Information [Under
Regulation 9A (5) of Securities and Exchange Board of India
(Prevention of Insider Trading) Regulations, 2015].

15. PARTICULARS OF EMPLOYEES AND RELATED
DISCLOSURES

The information required pursuant to Section 197 read with
Rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Amendment Rules, 2016 in respect of
employees of the Company, is enclosed as “Annexure II“ and
forms an integral part of this report.

Further, as per the provisions specified in Chapter XIII of
Companies (Appointment & Remuneration of Managerial
Personnel) Amendment Rules, 2016, none of the employees
of the Company are in receipt of remuneration exceeding
'' 1,02,00,000/- per annum, if employed for whole of the year
or '' 8,50,000/- per month if employed for part of the year.

16. ANNUAL RETURN:

Pursuant to Notification dated 28^th August, 2020 issued by
the Ministry of Corporate Affairs as published in the Gazette
of India on 28^th August, 2020, the details forming part of the
extract of Annual Return in Form MGT-9 is not required to
be annexed herewith to this report. However, the Annual
Return will be made available at the website of the Company
at: https://shanthalafmcg.com.

17. DETAILS OF SUBSIDIARY/JOINT VENTURES/
ASSOCIATE COMPANIES:

The Company is in process to incorporate two subsidiary
companies, namely, Ind-Edge Industries Limited and
M/s. STPL Commtrade Private Limited (WOS).

18. STATUTORY AUDITORS'' AND AUDITORS''
REPORT:

At the Annual General Meeting held on 18^th July, 2023, the
company has appointed M/s. Kale Malde & Co. Chartered
Accountants, bearing ICAI Registration Number: 154422W,
as the Statutory Auditors of the Company for a period of five
years from the conclusion of 9^th AGM till the conclusion of
the 14^th AGM.

Explanation as required under Sec 134(3)(f)(i) of the
Companies Act, 2013:

Re: Based on our examination, the company has not implemented
the audit trail facility in its accounting software for maintaining
its books of account during the current financial year:

Explanation: The company is in process to implement the
audit trail facility in its accounting software for maintaining
its books of account as per the requirement.

19. SECRETARIAL AUDIT:

Pursuant to Section 204 of the Companies Act, 2013 and the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, made there under, mandate
the company to have Company Secretary in practice for
furnishing secretarial audit report, accordingly, M/s Deep
Shukla & Associates have been appointed as Secretarial
Auditors of the Company. The Board of Directors of your
SHANTHALA had already appointed M/s. Deep Shukla
& Associates, Practicing Company Secretaries, Mumbai,
a peer-reviewed firm, to act as the Secretarial Auditor.
The Secretarial Audit Report for the financial year ended
31^st March 2024, as required under Section 204 of the Act.

The Secretarial Auditors'' Report is enclosed as Annexure III
to the Board''s report, which forms part of this Integrated
Annual Report.

20. INTERNAL AUDIT & CONTROLS:

The Company has in place adequate internal financial
controls with reference to the financial statement. During
the year, such controls were tested and no reportable
material weakness in the design or operation was noticed.
The Audit Committee of the Board periodically reviews
the internal control systems with the management and
Statutory Auditors.

Further, M/s. Manjuanatha & Shobhavathi, Chartered
Accountants (Firm Reg. No. 011554S) acting as an Internal
Auditor of the Company for a term of five (5) years i.e., from
Financial Year 2023-24 to 2027-28.

21. EMPLOYEES'' STOCK OPTION PLAN:

The Company has not provided stock options to any
employee.

22. VIGIL MECHANISM:

In pursuant to the provisions of sections 177(9) & (10) of the
Companies Act, 2013, a Vigil Mechanism for Directors and
employees to report genuine concerns has been established.
The Vigil Mechanism Policy has been uploaded on the
website of the Company at https://shanthalafmcg.com. The
employees of the Company are made aware of the said policy
at the time of joining the Company.

23. RISK MANAGEMENT POLICY:

The Company has laid down the procedure to inform
the Board about the risk assessment and minimization
procedures. These procedures are reviewed by the Board
annually to ensure that there is timely identification
and assessment of risks, measures to mitigate them, and
mechanisms for their proper and timely monitoring and
reporting.

The Company does not fall under the ambit of the top
1000 listed entities, determined on the basis of market
capitalization as at the end of the immediately preceding
financial year. Hence, compliance under Regulation 21 of
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 is not applicable.

24. CORPORATE GOVERNANCE REPORT:

Your Company is committed to achieving and adhering to
the highest standards of Corporate Governance. However,
the provisions of Corporate Governance are not applicable
to the Company pursuant to Regulation read with Regulation
15(2)(b) of the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations,
2015.

However, your Company undertakes that when the above
said provision is applicable to the Company the same will be
duly complied with in the period of 6 months.

25. DEPOSITS:

The Company has neither accepted nor renewed any fixed
deposits during the year under review under Section76 of
the Companies Act, 2013. There are no unclaimed deposits,
unclaimed / unpaid interest, refunds due to the deposit
holders or to be deposited to the Investor Education and
Protection Fund as on March 31, 2024.

26. LOANS & GUARANTEES:

During the year under review, the Company has not provided
any loan, guarantee, security or made any investment covered
under the provisions of Section 186 of the Companies Act,
2013, to any person or other body corporate.

27. RELATED PARTY TRANSACTIONS:

Related party transactions, if any, that were entered into
during the period ended March 31, 2024, were on an arm''s
length basis and were in the ordinary course of business,
details of which are provided in the notes to Accounts of
the Company. 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.

None of the Directors has any pecuniary relationships or
transactions vis-a-vis the Company.

Further all the necessary details of transaction entered with
the related parties pursuant to provisions of Section 188(1)
of the Companies Act, 2013 are attached herewith in Form
AOC-2 for your kind perusal and information. (Annexure: IV)

28. CONSERVATION OF ENERGY, RESEARCH AND
DEVELOPMENT, TECHNOLOGY ABSORPTION
AND FOREIGN EXCHANGE:

The details of conservation of energy, technology
absorption, foreign exchange earnings and outgo are as
follows:

(a) Conservation of Energy:

The use of energy is being optimized through improved
operational methods. Continuous efforts are being
made to optimize and conserve energy by improvement
in production process. Even though its operations
are not energyintensive,significant measures are
taken to reduce energy consumption by using energy-
efficient equipment. TheCompany regularly reviews
power consumption patterns in its all locations
and implements requisite improvements/changes
in the process in order to optimize energy/ power
consumption and thereby achieve cost savings.

Steps taken for utilizing alternate sources of energy;

The Company has not made any investment for utilizing
alternate source of energy;

Capital investment on energy conservation equipment;

The Company has taken adequate measures to conserve
energy by way of optimizing usage of power.

(b) Absorption of Technology:

The efforts made towards technology absorption:

In this era of competition, in order to maintain and
increase the number of clients and customers, we
need to provide the best quality services to our
clients and customers at a minimum cost, which is not
possible without innovation, and adapting to the latest
technology available in the market for providing the
services.

The Company has not imported any technology during
the year under review;

The Company has not expended any expenditure
towards Research and Development during the year
under review.

29. CORPORATE SOCIAL RESPONSIBILITY:

The Company is committed to discharging its social
responsibility as a good corporate citizen. As per the Financial
Statements for the period under review, the provisions of
Section 135 of Companies Act, 2013 are not applicable
to the Company for the F.Y. 2024-25. Consequently, the
Company is not required to formulate the Corporate Social
Responsibility (CSR) Committee.

30. COST AUDIT / COST RECORDS:

As per the Cost Audit Orders and in terms of the provisions
of Section 148 and all other applicable provisions of the
Companies Act, 2013, read with the Companies (Audit and
Auditors) Rules, 2014, Cost Audit and Cost Records are not
applicable to our Company.

31. OBLIGATION OF COMPANY UNDER THE
SEXUAL HARASSMENT OF WOMEN AT
WORKPLACE (PREVENTION,PROHIBITION
AND REDRESSAL) ACT, 2013:

The Company has in place an Anti-Sexual Harassment Policy
in line with the requirements of the Sexual Harassment at
Workplace (Prevention, Prohibition, and Redressal) Act,
2013. All employees (permanent, contractual, temporary,
trainees) arecovered under this policy. During the year ended
31^st March 2024, Company has not received any complaint
of harassment.

32. LISTING WITH STOCK EXCHANGE:

The shares of the Company were listed on National Stock
Exchange of India Limited on Small, Medium Enterprise
("SME") on Friday, November 03, 2024-23 only.

33. SECRETARIAL STANDARDS:

The Company has in place proper systems to ensure
compliance with the provisions of the applicable secretarial
standards issued by The Institute of Company Secretaries
of India and such systems are adequate and operating
effectively.

34. SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS OR
TRIBUNALS:

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

35. ACKNOWLEDGEMENT:

The Directors would like to thank all shareholders,
customers, bankers, suppliers and everybody else with
whose help, cooperation and hard work the Company is able
to achieve the results. The Directors would also like to place
on record their appreciation of the dedicated efforts put in
by the employees of the Company.

ON BEHALF OF THE BOARD OF DIRECTORS
SHANTHALA FMCG PRODUCTS LIMITED

Sd/- Sd/-

B Manjunath Mallya B Shobitha Mallya

Chairman & Managing Director Director

(DIN:06793251) (DIN:06793259)

Place: Kodagu
Date: 23/08/2024

Registered Address:

7^th Block, Gandhinagar Bye Pass Road,

Virajpet, Kodagu - 571218,

Karnataka, India