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Directors Report of Tamil Nadu Newsprint And Papers Ltd.

Mar 31, 2023

BOARDâS REPORT

TO THE MEMBERS

Your Company''s Directors are pleased to present the
43^rd Annual Report of the Company along with Audited
Financial Statements for the financial year ended
31^st March, 2023.

1. FINANCIAL RESULTS

The Financial Results for the year under review are
summarized below:

Particulars	2022-23	2021-22
Revenue from operations	5179.89	4020.29
Other Income	45.52	48.75
Total Revenue	5225.41	4069.04
Operating Profit (PBIDT/ EBIDTA)	1048.02	407.13
Finance cost	181.66	156.42
Gross Profit (PBDT)	866.36	250.71
Depreciation & Amortization expense	263.60	228.68
Profit / (Loss) before tax (PBT)	602.76	22.03
Tax Expense	214.89	7.70
Profit / (Loss) after tax (PAT)	387.87	14.33
Other Comprehensive Income	(5.22)	(1.20)
Total Comprehensive Income (Net of Taxes)	382.65	13.14

The Company has achieved the highest ever total
revenue, EBITDA since inception due to the better
realization and market condition and also has
improved efficiency in all areas of operation. The
financial performance is a commendable achievement
by the Management.

2. DIVIDEND

Your Director''s have recommended a dividend of 50%
(i.e. Rs.5.00/- per equity share) for the financial year
ended 31^st March, 2023. The dividend, if approved
by the shareholders at the Annual General Meeting,
will be paid to the equity shareholders whose
names appear in the Register of Members as on
18^th September 2023. The cash outgo on the proposed
dividend will be Rs. 34.61 Crore.

3. TRANSFER TO RESERVES

In the financial year 2021-2022, due to inadequacy
available profit the Company has declared dividend
@ Rs. 4 per per equity share to the shareholders
from the available profit of Rs. 8.69 crore and
Rs. 13.35 crore out of free reserve as per The
Companies (Declaration and Payment of Dividend)
Rule, 2014. Accordingly, the Company has transferred
a sum of Rs. 13.35 Crore of General Reserves to
Retained earnings during the current year.

During the financial year 2022-23, the Company has
transferred a sum of Rs. 300 Crore to General Reserve
from Retained Earnings. The Cumulative General
Reserve as on 31^st March 2023 is Rs. 1630.49 Crores.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR
a. Operations

1. The Company''s Revenue from Operations for
the year 2022-23 is Rs. 5179.89 crore.

2. Profit before tax is Rs. 602.76 crore and Profit
after tax is Rs. 387.87 crore.

3. During the year, the Paper production was
420793 MT.

4. Paper sales during the year was 420793 MT,
Domestic Sales accounts for 83% and Exports
at 17%.

5. During the year, the Packaging Board plant
production was 167035 MT.

6 . The Packaging Board sales during the year
2022-23 was 167357 MT. Domestic Sales
accounts for 96% and exports at 4%.

7. 312555 MT of Hardwood Pulp (HWP),
Chemical Bagasse Pulp (CBP) and Deinked
Pulp (DIP) were produced during the year in
Unit I. 108435 MT of Hardwood Pulp (HWP)
was produced during the year in Unit II.
The total pulp produced during the year was
420990 MT.

8. 7454.03 lakh units (Unit I - 5250.12 and
Unit II - 2203.91) of power was generated of
which 7432.21 lakh units (Unit I - 5248.75 and
Unit II - 2183.46) of power was consumed
and 21.82 lakh units (Unit I - 1.37 and Unit
II - 20.45 exported.

9. The bio-methanation plants have generated
methane gas of 89.86 lakh m³ during 2022-23.
The methane gas was consumed in lime kiln
and power boilers in replacement of furnace
oil 5088.90 KL of furnace oil and imported
coal 432 MT of imported coal.

10. Implementation of various water conservation
measures resulted in reduced overall
consumption of water in Unit I to 30 KL/per
ton of paper (which is one of the lowest in
paper industry).

11. The wind farms with an installed capacity of
35.5 MW capacity have generated 394.51 lakh
Units of ''Green Power'' during the year.

12. TNPL has established a cement manufacturing
factory (the first and only company in the
Indian Paper Industry) to convert the mill
wastes lime sludge and fly ash into high grade
cement as part of its solid waste management
system. During the year, the Company has
manufactured 214469 MT of cement.

13. During the year 2022-23, overall borrowings
decreased by Rs. 361.82 crore.

14. Market Capitalization was Rs. 1510.87 crores
as on 31.03.2023

b. Projects Implemented / Under implementations:

1. Mill Expansion Plan of TNPL Unit II -
Phase One

In continuation to the trial production commenced
at the modern Pulp mill along with Chemical
Recovery Island at Unit-II, the pulp production
was further optimized and the production
was ramped up to the rated capacity. The
balance of plants like Chips Processing system,
Chemical preparation systems including Chlorine
Di-Oxide plant, augmentation of existing Water
treatment and Effluent treatment plants were
also commissioned, optimized with the pulp mill
production rate. The projects implemented under
Mill Expansion Plan (MEP) of TNPL Unit II - Phase
1, features latest technology in all the areas with
emphasis on least environmental impact and
high energy efficiency. A continuous digester is
delivering consistent pulp quality with low specific
consumption of water, steam and power.The
Chemical Recovery Boiler is highly energy efficient

and the Evaporator plant has high steam economy.
The latest generation Integrated Chlorine dioxide
plant with nil effluent is in operation. A system
for collection and incineration of Non-condensable
gases, is in operation, to make the mill odour free.
These new technologies will further strengthen
the company''s ambition to maintain the leading
position and will enable TNPL to implement second
phase of the MEP, for capacity enhancement of
Unit II.

2. Revamp of Steam and Power system in Unit 1

As part of revamping, the existing steam and
power system in Unit I, the old low pressure
boilers installed since the mill inception in 1985,
are to be retired and replaced. Hence, in order
to have reliable supply of utilities like steam
and power for the mill operations, this project
envisages installation of two high pressure boilers
with steam generation of 125 tph each, at 105 at
a, 515 Â°C, along with a TG of 40 MW.

The Revamping of Steam and Power System
(RSPS) # 2, though initiated in the year 2019,
was kept in abeyance due to onset of the COVID
pandemic. However, the project implementation
is now proposed to be taken up and shall be
carried out in a phased manner, for a seamless
integration of the RSPS # 2 with the existing coal
feeding systems and Steam and Power distribution
systems. The work is estimated to be completed
within 24 months considering long procurement
lead times and the installation periods. Considering
the availability of Environment Clearance by June
2023, the project can be taken up thereafter and
completed by end June 2025.

c). Corporate Social Responsibility (CSR)

The Company has constituted a Corporate Social
Responsibility (CSR) Committee of the Board and
formulated a CSR Policy.

The Company has undertaken CSR activities as
per the CSR policy (available on your company''s
website www.tnpl.com). The details are contained
in the Annual Report on CSR activities vide
Annexure - I, forming part of this Report.

d) Contribution to Innovation and New

knowledge development

1. The Company nurtures creativity and
innovation through its Research &
Development (R&D) activities which are
carried out largely in-house. A few activities
are out sourced when warranted.

2. R&D activities focus on product development,
process improvement, raw material
substitution, development of new products
and protection of the environment.

3. The company has spent Rs. 14.72 Crore on
R&D activities during the year.

e. Awards

The company received the following awards and

accolades during the year:

a. INTERNATIONAL AWARD:

? The Company received the Greentech
International EHS Award 2022 at 2^nd Annual
Greentech International EHS Summit 2023
conducted by Greentech Foundation, New
Delhi in January 2023 at Panaji, Goa.

b. NATIONAL AWARDS:

? The Company was honored as "WINNER"
in the "Water Stewardship Award" category
during India Corporate Governance and
Sustainability Vision Summit 2023 conducted
by Indian Chamber of Commerce, Kolkatta in
February 2023 at New Delhi.

? The Company was selected and awarded as
"1^st Sustainable Industrial Practice Award"
during the 7^th FICCI International Sustainable
Conclave 2023 conducted by Federation of
Indian chambers of commerce and industry
in partnership with Deutsche Gesellschaft fur
Zusammenarbeit (GIZ) GmbH in February
2023.

? The Company was been selected and awarded
as "Noteworthy Water Efficient Award -
Within the Fence" during 16^th CII National
Awards for Excellence in Water Management
2022 conducted by Confederation of Indian
Industry - Triveni Water Institute, New Delhi
in September 2022.

? The Company''s project "Restoration
and Conservation of Bio-Diversity and
Conservation of High Conservation Value
Forest in TNPL Unit - II" was selected as
"Most Innovative Environment Project" during
CII - Environmental Best Practices Award
2022 in September 2022.

? The Company was selected as "WINNER"
under Environment Protection category" at
"22^nd Annual Greentech Environment Award
2022" in August 2022 at Guwahati for
adopting "Circular Economy Model in TNPL

? The Company, was awarded as

"Green Champion 2021" Board based on
immense contributions made in creating Bio
Diversity conservation Zone at Mondipatti
village, resulting in the improvement of
microclimate & species diversity including
improvement in endangered species

population such as Grey Slender Loris
instituted by Tamil Nadu Pollution Control
Board, Government of Tamil Nadu in June
2022.

? The Company was won First position in the
17^th National Award for Excellence in Cost
management 2019 in April 2022. The Award
is given by the "Institute of Cost and Works
Accountants of India" (ICWAI) for the best
costing practices in the companies.

5. MARKET TRENDS AND OUTLOOK

Having successfully overcome the Challenges Posed
by The Covid-19 Pandemic, the last year was an
unprecedented year for Indian and the Global
Economy. Paper Industry, being closely linked with
the economy has had an unprecedented year too.

The entire paper Industry benefited from the release
of pent up demand, post COVID-19. The company
could achieve Zero Stocks of paper at Unit- I, for
the second consecutive year and carry minimum
inventory of Board at Unit- II. The year was good for
the Writing & Printing segment of the Paper Industry,
with demand continuing to be strong through out the
year. However, demand has slowed down for both
printing & writing and packaging segment of the
Paper Industry in the current year. The new pulp mill
was commissioned in the 1^st quarter of the year giving

the much needed relief in terms of self-sufficiency for
the hardwood fiber at the Packaging board Unit. This
led us to shift to making 100% virgin grade during
the year, with focus on the fast - growing high value
added cup stock segment, which uses more of our
home hardwood pulp.

Educational demand of paper is cyclic which leads to
periods of low demand and very high demand. Since
customer demands are specific made to order sizes
and additionally demand forecasting is poor, a lot of
inventory accumulation and price corrections happen
during the lean periods. Considering this typical
nature of the market, your company has started to
increase its focus towards industrial uses of paper
which will ensure that there is a more uniform offÂ¬
take of paper during the entire year. The Company
has developed certain grades of industrial papers like
sublimation papers, Cup Stocks and papers for offline
coating applications to ensure greater regularity
of demand. Increased focus is being put to ensure
higher penetration in these segments.

Efforts are also on to improve the sales realisations
of different varieties of paper made by the company
by optimizing the product and locational mix. Regular
evaluation of the distribution network and appointment
of new distributors is being done. Increased focus is
being laid on greater financial discipline and control
measures as well as timely collection of receivables.

On an overall basis the year ended on an optimistic
note. Demand in the Printing & Writing segment
has slowed down in the current year. Supplies from
Imports are aplenty. This points to the next year
being a subdued one. However, startup of the new
pulp mill will help to enrich the product mix and to
optimise cost.

Per capita consumption of paper is low in India, in
comparison to the world average. Even if there is an
slight uptic in the per captia consumption of the paper
in India, the growth for paper and packaging board is
expected to be good.

With greater focus on "Make in India" we expect
exports of paper and converted paper products to
be robust in future. A strong and robust domestic

demand coupled with strategic exports of both paper
and converted paper products augers well for the
Indian Paper industry. The company is well positioned
to take full advantage of this bright future outlook.

6. DIRECTORS & KEY MANAGERIAL
PERSONNEL

The details of Directors/ Key Managerial Personnel
(KMP) who were appointed or have ceased to be
Director/KMP of the Company during the year
2022-23 are as follows:

Sl. No.	Name of Director/KMP	Date of Appointment / Cessation	Appointment / Cessation
1.	Dr M Sai Kumar, I.A.S.,	12.06.2022	Appointed as Chairman and Managing Director
2.	Thiru S Krishnan, I.A.S.,	12.06.2022	Ceased as Chairman and Managing Director
3.	Thiru S Krishnan, I.A.S.,	12.06.2022	Change in Designation from Chairman and Managing Director to NonÂ¬ Executive Director
4.	Dr N Sundaradevan, I.A.S, (Retd.)	12.09.2022	Appointed as Independent Director (1^st Term)
5.	Thiru R Anand	12.09.2022	Appointed as Independent Director (1^st Term)
6.	Thiru N Narayanan, I.A.S., (Retd.)	18.09.2022	Ceased as Independent Director (2^nd Term)
7.	Dr M Arumugam	19.09.2022	Appointed as Independent Director (2^nd Term)

Sl. No.	Name of Director/KMP	Date of Appointment / Cessation	Appointment / Cessation
8.	Thiru P B Santhanakrishnan	19.09.2022	Appointed as Independent Director (2^nd Term)
9.	Thiru R Anand	20.09.2022	Ceased as Independent Director (1^st Term)
10.	Thiru Harmander Singh, I.A.S.,	31.10.2022	Ceased as Director
11.	Thiru C Vijayaraj Kumar, I.A.S.,	13.02.2023	Appointed as Director
12.	Tmt Anuradha Ponraj	01.07.2022	Appointed as Company Secretary
13.	Thiru B Thamizh Selvan	30.06.2022	Ceased to be Company Secretary

As on 31^st March, 2023, your Company has nine (9)
Directors out of whom five are Independent and
other three are Government Nominee Directors. The
remaining one is Chairman and Managing Director.

The Independent Directors are appointed for a fixed
period of three years.

The three Government Nominee Directors are
appointed in replacement for existing Government
Nominees only during the financial year whose
appointments have to be confirmed in the Annual
General Meeting. The remaining one director

i.e. Chairman and Managing Director is not liable for
retirement by rotation as per Article 141 of the Articles
of Association of the Company.

In accordance with the provisions of the Companies
Act, 2013 and in terms of the Memorandum and Articles
Association of the Company, Thiru S Krishnan, I.A.S.,
Director retires by rotation at the forthcoming Annual
General Meeting. He is eligible for reappointment as
Director.

There has been no changes in Senior Management
Executives during the financial year 2022-23.

6.1 Declaration from Independent Directors on
Annual Basis

The Independent Directors have submitted their
disclosure to the Board confirming that they fulfill all
the requirements as to qualify for their appointment
as an Independent Director under the provisions of
Section 149 of the Companies Act, 2013 as well as SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015, hereinafter referred to as
SEBI Regulations. In the opinion of the Board, the
Independent Directors possess the requisite expertise
and experience and they fulfil the conditions specified
in the Act and the Rules made thereunder and are
independent of the management.

6.2 Remuneration Policy

The Board, on the recommendation of the
Nomination & Remuneration Committee has framed
a policy for selection and appointment of Directors,
Senior Management and their remuneration. The
details of policy are provided in the website of the
Company and in the Corporate Governance Report
forming part of this report (Annexure VII). Also
the ratio of remuneration of KMP to the median
employees remuneration is also forming part of this
report (Annexure IV).

6.3 Meetings

A calendar of Meetings is prepared and circulated in
advance to the Directors.

During the year, eight meetings of the Board and Seven
meetings of the Audit Committee were convened and
held, the details are given in the Corporate Governance
Report forming part of this report (Annexure VII).
The intervening gap between the Meetings was within
the period prescribed under the Companies Act, 2013
and Regulation 17(2) of the SEBI Regulations.

6.4 Board Evaluation

January 5, 2017 as suggested by SEBI was referred to,
while carrying out the annual performance evaluation.
A structured questionnaire was prepared after taking
into consideration inputs received from the Directors,
covering various aspects of the Board''s functioning
such as adequacy of the composition of the Board
and its Committees, Board culture, execution and
performance of specific duties, obligations and
governance.

A separate exercise was carried out to evaluate
the performance of individual Directors including
the Chairman of the Board, who were evaluated
on parameters such as level of engagement
and contribution, independence of judgments,
safeguarding the interest of the Company and its
minority shareholders etc. The performance evaluation
of the Independent Directors was carried out by
the entire Board on the following broad criteria i.e.
attendance and level of participation at meetings of
the Board/Committees, independence of judgement
exercised by Independent Directors, interpersonal
relationship etc.

The performance evaluation of the Chairman and
Managing Director and the Non Independent Directors
was carried out by the Independent Directors in their
meeting held on 31^st March 2023. The Directors
expressed their satisfaction with the evaluation
process.

7. Internal Complaints Committee

The Company has constituted an Internal Complaint
Committee (ICC) in accordance with Section 4 of
the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal.

1. Tmt R. S. Tamilarasy, Senior Manager (Lab) -
Presiding Officer

2. Thiru K. S. Sivakumar, Senior Manager - HR /
Member

3. Tmt R Suchitradevi, Officer - HR / Member

4. Tmt Revathi Janakeraman, Founder /CEO, CWEO
- Member representing NGO

The above members are amongst employees
preferably committed to the cause of women or who
have had experience in social work or have legal
knowledge. During the year under review, there
were no complaints referred to the committee and no
complaints were pending for action.

8. AUDITORS

a) Statutory Auditors:

The Comptroller and Auditor General of India
appointed M/s Maharaj N R Suresh and Co LLP,
Chartered Accountants, Chennai, as the Statutory
Auditors of the Company for the financial year
2022-23.

b) Cost Auditors :

Pursuant to Section 148 of the Companies Act, 2013
read with The Companies (Cost Records and Audit)
Amendment Rules, 2014, the cost audit records
maintained by the Company in respect of its paper,
cement and energy activities are required to be
audited. Your Directors had, on the recommendation
of the Audit Committee, appointed M/s S Mahadevan
& Co, Cost Accountants to audit the cost accounts
of the Company for the year 2022-23. The cost
audit report for the year 2022-23 will be submitted
to the Central Government before the due date.
Cost Audit report for the financial year 2021-22 was
filed within scheduled time.

c) Secretarial Auditor:

Pursuant to the provisions of Section 204 of the
Companies Act, 2013 and The Companies (Appointment
and Remuneration of Managerial Personnel) Rules,
2014, the Company has appointed M/s. M Damodaran &
Associates, LLP, a firm of Company Secretaries in practice
to undertake the Secretarial Audit of the company for
the Financial Year 2022-23. The Report of the secretarial
audit is annexed herewith as "Annexure II".

9. NON- CONVERTIBLE DEBENTURES

The company has not issused any Non-Convertible
Debentures (NCD) during the year and there was no
NCD outstanding as on 31^st March, 2023.

10. FIXED DEPOSITS

During the year under review, the Company has not
accepted deposit from the public falling within the
ambit of Section 73 of the Companies Act, 2013 and
The Companies (Acceptances of Deposits) Rules,
2014.

11. RISK MANAGEMENT COMMITTEE/
FRAMEWORK

The Company has constituted a Risk Management
Committee as required by the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015
("the SEBI, LODR")

TNPL has established a Risk Management Framework
under which the risks covering the entire operation
have been identified and categorized as high, medium
and low.

All the risks are discussed periodically by the Senior
Management in the Committee meetings and
appropriate actions are taken pro-actively.

The risk details and mitigation plans are placed before
the Risk Management Committee and the Board,
bi-annually as per the requirements of SEBI (LODR).

12. INTERNAL CONTROL SYSTEMS AND THEIR
ADEQUACY

TNPL has instituted adequate internal control
procedures commensurate with the size of its
operations. TNPL has also prepared an ''Internal
Control Procedure Manual'' to ensure that the
control procedures are followed by all Departments.
The Departments concerned in the company are
complying with the stipulations in the manual without
deviating the procedures. The Internal Audit monitors
and evaluates the efficacy and adequacy of internal
control system in the Company, its compliance with
operating systems, accounting procedures and
policies at all locations of the Company.

Internal controls are supported by internal audit and
management reviews. The Audit Committee meets
periodically with the Management, External-Internal
Auditors, Statutory Auditors and reviews the Annual
Audit plans and internal controls. All significant
observations of the Auditors are acted upon. The
Audit Committee met 7 times during the financial
year. The review of Management Response to Audit
Observations constitutes an important aspect of the
Agenda.

13. VIGIL MECHANISM / WHISTLE BLOWER
POLICY

The Company has framed a Vigil Mechanism / Whistle
Blower Policy; the details of such Policy are explained
in the Corporate Governance Report and also posted
on the website of the Company at www.tnpl.com.

14. PARTICULARS OF LOANS, GUARANTEES
AND INVESTMENTS

Details of Loans, Guarantees and Investments
covered under the provisions of Section 186 of the
Companies Act, 2013 are given in the notes to the
Financial Statements.

15. TRANSFER TO INVESTOR EDUCATION AND
PROTECTION FUND (IEPF)

During the year, the Company has transferred
Rs. 15,70,230/- (Rupees Fifteen Lakhs Seventy
Thousand Two Hundred and Thirty Only) being the
Dividend amount which was due and payable and
remained unclaimed and unpaid for a period of seven
years, to the Investor Education and Protection
Fund, as required under Section 124(5) of the
Companies Act, 2013.

16. UNPAID DIVIDEND STATUS

Dividend was remaining unpaid due to
non-confirmation of their new addresses by the
concerned shareholders. The unpaid dividend
warrants were returned by the postal authorities.
Effective follow-up by the Company has resulted
in Unpaid Dividend being consistently equal or
below 0.5% of the total dividend. As and when the
shareholders communicate the new address, the
dividend is sent to the shareholders. At the end of
seven years, the unpaid dividend is transferred to
Investor Education and Protection Fund (IEPF). The
table and graph given below summarize the status of
Unpaid Dividend.

17. ENERGY CONSERVATION, TECHNOLOGY
ABSORPTION AND FOREIGN EARNINGS
AND OUTGO

The particulars required under Sec. 134(3) (m) of
the Companies Act, 2013, read with the Rule 8 of
The Companies (Accounts) Rules, 2014, is furnished
in Annexure III to this Report.

18. HEALTH

An Occupational Health Centre (OHC) is functioning
on round the clock basis in both the Units of TNPL
with requisite Medical Officers, Nurses, Pharmacists,
ANM (Auxiliary Nursing Midwisery) and Attenders to
render Medical Assistance for the employees and their
dependents. In addition, every Sunday, one Speciality/
Super Speciality Doctor from various branches visits
the OHC. For Speciality/ Super Speciality treatments
apart from facilities in OHC, employees are referred
to outside hospitals for expertise treatment. In such
case, company bears 50% of medical expenses and
for remaining 50% there is a tie up with an insurance
company.

Further, Company bears the entire medical expenses
for 7 Serious Ailments. In order to avail medical
treatment, 180 days of Special Leave is being
sanctioned to those employees, who suffer from any
one of the 7 serious Ailments. This apart, in case,
180 days of Special Leave got exhausted, an additional
180 days of special leave is also sanctioned on case
to case basis.

To meet out the statutory requirements,
comprehensive Master Health Check-up is being
carried out for employees five times in their service
period i.e at age of 40 years, 45 years, 50 years,
55 years and 59 years on free of cost. Every year,
Audiometric test is being conducted to those
employees, who are exposed to high noise at areas.
Once in 2 years, eye test is being carried out for
employees, who are in driving job.

TNPL is committed to take care of the health of
employees thereby ensuring better productivity.

19. SAFETY

TNPL has adopted a clearly defined Occupational
Health and Safety Policy. Suitable Personal Protective
Equipment''s (PPE) are provided to all employees.
Periodical Training Programs are conducted on

handling of hazardous chemicals, material handling,
usage of PPEs, electrical safety, road safety, first aid,
fire fighting etc. to improve safety awareness among
the employees including contract workmen. Caution
boards, posters, slogans, Do''s and Don''ts etc. are
displayed at prominent places to promote safety at
work places. Safety Committee with representatives
from Management and Workmen has been constituted.
Safety Committee meetings are conducted periodically
and suggestions given to improve safety aspects are
implemented.

20. PARTICULARS OF EMPLOYEES

None of the employees of the company was in receipt
of remuneration in excess of the limits prescribed under
the Companies Act, 2013 and the Rules framed there
under. The information as required under Section 197
read with Rule 5 of The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014
in respect of employees of the company, is annexed
as Annexure IV.

21. CASH FLOW STATEMENT

As required under Regulation 34(2) (c) of the
SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015, a Cash Flow Statement prepared
in accordance with the Indian Accounting Standard 7
(IND AS-7) forming part of this report.

22. EXPORT HOUSE STATUS

The Company continues to be accredited with
Star Export House Status by the Government of India,
Ministry of Commerce, Directorate General of Foreign
Trade, in recognition of the export performance.

23. INDUSTRIAL AND PERSONNEL RELATIONS

The Company continues to ensure an equitous, safe
and secure environment for employees to work with
dignity and to have healthy employee relations,
thereby paving way for better productivity. Positive
work culture built over the years has enabled the
company to harness its human resources to the
full potential. TNPL is proud to exude that there is
no industrial unrest despite of having many Trade
Unions. Inspite of severe competition, enthusiasm and
unstinting efforts of the employees have enabled the
Company to remain at the forefront of the industry.

Since inception, TNPL is committed to provide the
basis for sustainable development by upholding ethical
practice and promoting the economic and social
aspirations of all citizens in the surrounding area to
maintain cordial and healthy industrial relations that
strike a balance between organisation''s purpose and
business needs and the bottom line work force.

24. ENHANCING SHAREHOLDERS'' VALUE

Your Company believes in the importance of its
Members who are among its most important
stakeholders. Accordingly, your Company''s operations
are committed to the goal of achieving high levels of
performance and cost effectiveness, growth building,
enhancing the productive asset and resource base and
nurturing overall corporate reputation. Your Company
is also committed to creating value for its stakeholders
by ensuring that its corporate actions have positive
impact on the socio-economic and environmental
growth and development.

25. DIRECTOR''S RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of
the Companies Act, 2013, with respect to Directors''
Responsibility Statement, it is hereby confirmed that:

1. in the preparation of the annual accounts for
the year ended 31^st March, 2023, the applicable

accounting standards have been followed along
with proper explanation relating to material
departures, if any;

2. the Directors had selected 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 of the company for that
period;

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

4. the Annual Accounts were prepared for the
financial year ended 31^st March, 2023 on a going
concern basis;

5. the Directors have laid down proper internal
financial controls to be followed by the company
and that such internal financial controls are
adequate and are operating effectively;

6. the Directors have devised proper systems to
ensure compliance with the provisions of all
applicable laws and such systems are adequate
and are operating effectively.

26. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a)
of the Act, the Annual Return will be made available on
the Company''s website at www.tnpl.com. The details
forming part of the extract of the Annual Return in
Form MGT 9 is attached as (Annexure V).

27. MANAGEMENT DISCUSSION AND ANALYSIS
AND CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis
and the Report on Corporate Governance forming part
of Directors'' Report are attached as (Annexures VI
and VII).

As required by the SEBI Regulations, the Statutory
Auditor''s Certificate on Corporate Governance and a
Declaration by the Chairman and Managing Director

with regard to Code of Conduct are attached to the
Report on Corporate Governance.

28. BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORTING

Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements)
Regulations, 2015 (SEBI, LODR) with amendments
to Regulation 34 vide Gazette notification no.
SEBI/LAD-NRO/GN/2021/22 dated 5^th May 2021
introduced new reporting called The ''Business
Responsibility & Sustainability Reporting'' (BRSR) for
the top 1000 companies based on Market Capitalization
of BSE and NSE for every financial year ending
31^st March.

This reporting is applicable to our Company from this
financial year 2022-23. This forms part of the Annual
Report in line with the format prescribed by SEBI
as required under Regulation 34(2)(f) of the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015 is attached as (Annexure VIII).

29. RELATED PARTY TRANSACTIONS

All Related Party Transactions during the financial
year 2022-23 were on an arm''s length basis and were
in the ordinary course of business. They have been
disclosed in Note No. 39(e) of the financial statements.
None of these transactions is likely to have a conflict
with the company''s interest.

There are no materially significant transactions with
related parties during the year with Promoters,
Directors, Key Managerial Personnel or other
designated persons which are potentially conflicting
with the interest of the Company at large.

The Board of Directors have updated the policy on
Related Party Transactions and the same is uploaded
on the Company''s website at www.tnpl.com.

None of the Directors or Key Managerial Personnel
have any pecuniary relationships or transactions visÂ¬
a-vis the Company.

Accordingly, the disclosures of Related Party
Transactions required under section 134 (3) (h) of the
Companies Act, 2013 in Form AOC-2 is not applicable.

30. SUBSIDIARIES/ASSOCIATES/JOINT
VENTURES

The Company does not have any Subsidiaries/
Associates/Joint Ventures.

31. CHANGE IN NATURE OF BUSINESS

There has been no change in the nature of business
during the financial year under review

32. SECRETARIAL STANDARDS

The Company is in compliance with the Secretarial
Standards on Meetings of the Board of Directors
(SS-1) and Secretarial Standards on General Meetings
(SS-2).

33. SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS

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

34. MATERIAL CHANGES AND COMMITMENTS,
IF ANY, AFFECTING THE FINANCIAL
POSITION OF THE COMPANY WHICH
HAVE OCCURRED BETWEEN THE END OF
THE FINANCIAL YEAR OF THE COMPANY
TO WHICH THE FINANCIAL STATEMENTS
RELATE AND THE DATE OF THE REPORT

Except as disclosed elsewhere in this report, no
material changes and commitments which could
affect the Company''s financial position have occurred
between the end of the financial year and date of this
report.

35. CEO / CFO CERTIFICATION

As required by Regulation 17(8) of the SEBI
Regulation, a Certificate on the Financial Statements
and Cash Flow statement of the company for the year
ended 31^st March, 2023 duly signed by the Chairman
and Managing Director was submitted to the Board
of Directors at their meeting held on 24^th May, 2023.

36. DISCLOSURE REQUIREMENTS - SECTION
134 - COMPANIES ACT, 2013

As per the Companies Act, 2013 [Section 134(3)] the
Boards report shall include additional contents and
disclosures. Accordingly such contents and disclosures
has been made at appropriate places that forms part
of this Report.

37. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation
for the assistance, co-operation and support extended
to the company by the Government of Tamil Nadu,
Commercial Banks, Financial Institutions, Sugar Mills
and Dealers.

The Board also places on record its sincere appreciation
of the positive response received from the Company''s
valued customers and thank them for their continued
support.

The Company is grateful to all employees for their
exemplary co-operation during the year. Their
contribution has been truly outstanding. The Directors
place on record their appreciation of the excellent
effort made by every employee to enhance the
company''s performance in adverse market conditions.

Finally, the Board of Directors sincerely thank the
shareholding community for their solid support and
for the confidence they have reposed in the Company.

38. CAUTIONARY STATEMENT

Statements in the Director''s Report and the
Management Discussion & Analysis describing the
Company''s objectives, expectations or forecasts may
be forward-looking within the meaning of applicable
securities laws and regulations. The Company
cannot guarantee the accuracy of assumptions and
the projected future performance of the Company.
The actual results may materially differ from those
expressed or implied in this report. Important factors
that could influence the Company''s operations
include global and domestic demand and supply
conditions affecting selling prices of finished goods,
input availability and prices, changes in government
regulations, tax laws, economic developments within
the country and other factors such as litigation and
industrial relations

For and on behalf of the Board

Place: Chennai Dr M Sai Kumar, I.A.S.,

Date: 24^th May 2023 Chairman and Managing Director

Mar 31, 2018

DIRECTORSâ REPORT

TO THE MEMBERS

The Company''s Directors are pleased to present the 38^th Annual Report of the Company along with audited financial statements for the financial year ended 31^st March, 2018.

1. FINANCIAL RESULTS

The Financial Results for the year under review are summarized below:

(? in Crore)

Particulars	2017-18	2016-17
Revenue from operations (including Excise Duty)	3125.10	3101.77
Other Income	33.60	36.95
Operating Profit (PBIDT/ EBIDTA)	438.47	765.90
Finance cost	244.63	252.02
Gross Profit (PBDT)	193.84	513.88
Depreciation & Amortization expense	221.83	207.68
Profit/(Loss) before tax	(27.99)	306.20
Tax Expense	14.16	41.64
Profit/(Loss) after tax	(42.15)	264.56
Other Comprehensive Income	3.10	(7.03)
Total Comprehensive Income (Net of Taxes)	(39.05)	257.53

2. DIVIDEND

In accordance with "the Companies (Declaration and payment of dividend) Rules, 2014, your directors recommend a dividend of 50% (i.e., Rs, 5/- per share) out of ''free reserves'' for the year ended 31^st March, 2018. The dividend, if approved by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 19^th September, 2018. The cash outgo on the proposed dividend including Dividend distribution tax, will be Rs, 41.72 Crore.

3. PERFORMANCE HIGHLIGHTS OF THE YEAR

a) Operations

1. The Company''s turnover during the year 2017-18 is 3037.02 crore

2. Loss before tax is Rs, 27.99 crore and Loss after tax Rs, 42.15 crore.

Printing and Writing Paper

3. During the year the Paper production was 353959 MT.

4. Achieved Paper sales of 3,52,937 MT during the FY 2017-18. Domestic Sales accounts for 77% and Exports at 23%.

Packaging Paper Board

5. The packaging paper board plant production was 1,41,851 MT during the financial year 2017-18, equivalent to 70.90% of capacity.

6. The packaging paper board sales during the year 2017-18 was 1,42,739 MT. Domestic Sales accounts for 86% and Exports at 14%.

7. 2,69,938 tonnes of Hardwood, chemical Bagasse Pulp and Deinked Pulp were produced during the year.

8. Generated 5263 lakh units of power, 5201 lakh units were internally consumed and 62 lakh units exported to the state grid (Unit I). Generated 1130 lakh units of power, 1038 lakh units were internally consumed and 92 lakh units exported to the state grid (Unit II).

Tamil Nadu where the Company''s production facilities are located, has witnessed severe drought and water shortage during the year. The water shortage became acute since February 2017. As paper production is highly water intensive, water shortage has affected production since February 2017 and the production normalized by last week of July, 2017. During the year from April, 2017 to July, 2017, the Company lost production equivalent to 46041 MT of paper, 33302 MT of Hard Wood Pulp and 46350 MT of Chemical Bagasse. Your Company has managed the serious unforeseen set back to a larger extent by reducing the fresh water consumption through extensive recycling of process water and implementing contingency plans on time. But for the proactive measures taken by the company, the production loss would have been much higher. Despite the severe hardship during the water crises your Company has delivered good results in remaining part of the year.

9. The bio-methanation plants have generated methane gas of 63.26 lakh m³ during 2017-18. The methane gas was consumed in lime kiln and power boilers in replacement of furnace oil 3724 KL and imported coal 319 MT.

10. The wind farms with an installed capacity of 35.5MW capacity have generated 515 lakh Kwh Units of ''Green Power'' during the year.

11. The Paper & pulp mill have implemented various water conservation projects and reduced the overall consumption of water from 40 KL/per ton to about 27 KL/Per ton of paper which is one of the lowest in paper industry.

12. TNPL is the First and only company in the Indian Paper Industry to have established a cement manufacturing factory to convert the mill wastes lime sludge and flyash into high grade cement as part of its solid waste management system. During the year, the Company has manufactured 2,27,947 MT of cement.

13. The Company has reduced overall debt (Term Loan and Working Capital) to an extent of Rs, 397.84 Crore during the financial year 2017-18.

14. Market Capitalization crossed Rs, 3453.61 crore mark first time during the year on 08.01.2018. Market Capitalization as on 31.03.2018 was Rs, 2407.49 crore

b) Projects Implemented:

Key Development Projects Implemented Installation of Roll grinding machine in TNPL Unit II

A new Roll grinding machine was planned for installation in TNPL Unit II for regular regrinding of the Board Machine rolls (rubber covered and steel covered rolls including the dryer cylinders), at a capital outlay of Rs, 25 Crore. The installation of the machine was completed in September

2017. After the trials, the machine was put into continuous operation from October 2017.

Installation of additional Bio-gas reactor in TNPL Unit I

The Company had four (4) nos. of UASB reactors in the Bio-methanation plant handling a hydraulic load of 15,000 to

16,000 m³/day and COD load of 75,000 to 85,000 kg/day. In order to improve the biogas plant efficiency and reduce organic load on forward system, two more bio-reactors were installed. The bio-reactors were commissioned in August 2017.

Augmentation of Electrostatic Precipitator for Recovery Boiler in TNPL Unit I

The recovery boiler was provided with a twin chamber Electrostatic precipitator (ESP) to control the particulate emissions to less than 50 mg/NM3. An additional ESP chamber, was planned and installed, so as to improve the overall environmental efficiency of the Recovery boiler. The project was commissioned in March 2018.

PROJECTS UNDER IMPLEMENTATION

Mill Expansion Plan of TNPL Unit II

As part of the growth plan, TNPL has embarked on a Mill Expansion Plan (MEP) in Unit II for producing 1,65,000 MT of paper per annum by way of installing a state-of- the art Paper Machine,a 400 tpd chemical hardwood pulp mill with chemical recovery boiler, augmentation of Captive power plant and Waste water treatment plant and other auxiliaries at a total capital outlay of Rs, 2,100 crores.

Based on the approved Terms of Reference (TOR) by the Ministry of Environment, Forest and Climate Change (MOEFCC), an EIA (Environment Impact Assessment) study was conducted from June to August 2017. A detailed EIA report has been prepared by the consultants. Based on this report, a Public hearing shall be conducted by the Tamil Nadu Pollution Control Board (TNPCB) as per the requirements of MOEFCC. The Environmental Clearance (EC) for the Project shall be issued by MOEFCC based on the Expert committee appraisal. After securing the EC, the project implementation shall be taken up.

With the implementation of the expansion plant, the overall paper and packaging board production capacity in Unit I and Unit II of your company will be increased to 7,65,000 MT per annum from the current capacity of 6,00,000 MT per annum along with pulping facilities.

c) Contribution to Environment

1) TNPL is one among the 35 of the world''s most important pulp and paper manufacturers participated in WWF Environmental Paper Company Index (EPIC) 2017.

2) Production of 1.16 Lakh MT of bagasse pulp and 85,119 MT of Deinked pulp during the year has facilitated conservation of 8.5 Lakh MT of pulpwood.

3) "World Environment Day", "International Ozone Day" and "World Water Day" were celebrated involving school children in planting trees.

4) 3406 MT of carbon dioxide content in the Flue gas generated in the cement mill has been consumed in the PCC plant for producing 7582 MT of PCC.

5) The Company has generated about 515 Lakh KWH Wind energy during 2017-18.

6) 63.26 Lakh m³ methane generated in the Bio-methanation plant was consumed in lime kiln and Power Boilers saving 3724 KL of Furnace oil and 319 MT of imported coal.

d. Corporate Social Responsibility (CSR)

e. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R&D activities which are carried out largely in-house. A few activities are out sourced when warranted.

2. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

3. The company has spent Rs, 9.32 Crore on R & D activities during the year.

f. Awards

- Mission Energy Foundation, Maharashtra has awarded TNPL "Fly ash utilization 2018 Award" in the category of Green Building Material -Cement.

- TNPL has been awarded as "Water Stewardship Award " during India Corporate Governance and Sustainability Vision Summit 2018 New Delhi conducted by Indian Chamber of Commerce.

- TNPL has been selected and awarded as "Efficient Water Management Unit" at Confederation of Indian Industry (CII) for Excellence in Water Management - 2017 "Within the Fence" during Water Innovation Summit 2017 at New Delhi.

- TNPL received "Most Innovative Project" award for the Environmental Best Practices Award 2017 conducted by CII-Sohrabji Godrej Green Business Centre, Hyderabad.

- TNPL has bagged the 18^th National Award for Excellence in Energy Management for the year 2017 from Confederation of Indian Industry.

4. MARKET TRENDS

a) General

Total installed capacity of Indian Paper Industry including Newsprint is approximately 16 Million Metric Tonnes and average capacity utilization is 90%. Overall consumption inclusive of imports and net of exports is about 14 million metric tonnes.

The average per capita consumption in India is around 13 kgs against the global average consumption of 58 kgs. The growth rate of paper across the globe is around 1.5%. With the consistent economic growth and greater emphasis for education, the demand growth in India is estimated at 6%, consisting of 5-6% in Printing and Writing paper, 10-12% in Industrial and Packaging Board, 3-4% in newsprint and speciality papers. The overall GST levied on paper is 12%. Imports from countries covered under Free Trade Agreements (FTA), are levied basic customs duty at zero percent.

b) Printing & Writing Paper

During 2010 and 2011, many mills in the country had added capacity. Due to surplus capacity resulting in excess supply impacted price of paper in domestic market. Paper Industry faced acute shortage of pulpwood during 2013. Few mills resorted to importing pulpwood at higher prices. With the steep increase in input costs, paper prices rose during 2013. However, with the paper prices softening in the international market and import of paper in large volume under Free Trade Agreements (FTA), paper prices dropped sharply during 2014 and 2015. The Indian paper industry faced unprecedented challenges both on cost front and market front for two consecutive years 2014 & 2015. The market recovered and stabilized during 2016-17 due to consistent growth in demand and sudden drop in supplies. The shortage in supplies was met through imports mainly from Indonesia and China.

c) Packaging Boards

The market for Packaging Board is estimated at 3.50 Million tonnes. Grey-Back Board account for 45%, White-back and other high end varieties (FBB, SBS, Cup Stock.) account for the remaining 55%. The demand growth for packaging boards is estimated at 10-12% per annum.

d) Outlook

At the current estimated demand growth at 6%per annum, the domestic consumption is expected to reach 25 million metric tonnes per annum by 2024-25. This offers a good opportunity for capacity addition.

e) TNPL''s response to Market Trends

TNPL has always been in the forefront matching its capability, capacity and performance with the overall trends in the industry. TNPL has been increasing its production capacity consistently. With the commissioning of board plant, the total production capacity of the company has been increased to 6 lakh MT. Now your company is taking steps to increase the capacity from 6 Lakhs MT per annum to 7.65 Lakhs MT per annum to cope up with the growth in the Industry.

5. DIRECTORS & KEY MANAGERIAL PERSONNEL

The details of Directors/ key managerial personnel who were appointed or have ceased to be Director/KMP of the Company during the year 2017-18 are as follows:

10.	Thiru. V Chandrasekaran	13.11.2017	Appointed as Additional (Independent) Director.
11.	Thiru. S Sivashanmugaraja, IAS	29.11.2017	Appointed as Additional Director designated as Managing Director.
12.	Thiru. K Gnanadesikan, IAS	31.01.2018	Appointed as Additional Director designated as Chairman.
13.	Thiru A Velliangiri	29.03.2018	Ceased to be a Director and CFO.

Sl. No.	Name of Director/ KMP	Date of Appointment /Cessation	Appointment / Cessation
1.	Tmt. Sarada Jagan	01.04.2017	Ceased to be a Director
2.	Thiru N Kumaravelu	19.04.2017	Ceased to be a Director
3.	Thiru Vikram Kapur, IAS	20.04.2017	Ceased to be a Director
4.	Dr. R.Selvaraj, IAS	20.04.2017	Appointed as Additional Director and designated as Managing Director and regularized as Director at the AGM held on 19.09.2017.
		29.11.2017	Ceased to be a Director
5.	Thiru Atulya Misra, IAS	20.04.2017	Appointed as Additional Director, designated as Chairman and regularized as Director at the AGM held on 19.9.2017.
		31.01.2018	Ceased to be a Director
6.	Tmt. Soundara Kumar	30.06.2017	Appointed as Additional (Independent) Director and appointed as Independent Director at the AGM held on 19.09.2017.
7.	Thiru. Mahesan Kasirajan, IAS	07.09.2017	Ceased to be a Director.
8.	Tmt. Anu George, IAS	19.09.2017	Appointed as Additional Director
9.	Thiru. M.R Kumar	05.10.2017	Ceased to be a Director.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Thiru K. Shanmugam, IAS, Director retires by rotation at the forthcoming Annual General Meeting. He is eligible for reappointment as Director.

5.1 Declaration from Independent Directors on Annual Basis

The Independent directors have submitted their disclosure to the Board confirming that they fulfil all the requirements as to qualify for their appointment as an Independent Director under the provisions of Section 149 of the Companies Act, 2013 as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, hereinafter referred to as SEBI Regulations. The Board confirms that the said independent directors meet the criteria as laid down under the Companies Act, 2013 as well as SEBI Regulations.

5.2 Remuneration Policy

5.3 Meetings

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year, eight meetings of Board and seven meetings of Audit Committee were convened and held, the details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Regulation 17(2) of the SEBI Regulations.

5.4 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI Regulations, the Board has internally carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees for the financial year ended 31^st March, 2018. The guidance note dated January 5, 2017 as suggested by SEBI was referred to while carrying out the annual performance evaluation. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board on the following broad criteria i.e. attendance and level of participation at meetings of the Board/Committees, independence of judgement exercised by Independent Directors, interpersonal relationship etc.

The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors in their meeting held on 19.03.2018. The Directors expressed their satisfaction with the evaluation process.

6. INTERNAL COMPLAINTS COMMITTEE

As per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 & Rules made thereunder, the company has constituted an Internal Complaints Committee (ICC) and following are the members:

i) Tmt. R.S. Tamilarasy, Manager (Lab) - Presiding Officer

ii) Thiru P. Sundaram, Manager - HR (Member)

iii) Tmt. M. Pemilabeham, Officer - HR (Member)

iv) Thiru M. Velliangiri, President, Kanmani Trust, Karur -Member representing NGO

The above members are committed to the cause of women and they possess experience in social work and legal knowledge. During the year under review there were no complaints referred to the Committee.

7. AUDITORS

a) Statutory Auditors The Comptroller and Auditor General of India appointed M/s. Brahmayya & Co., Chartered Accountants, Chennai, as the Statutory Auditors of the Company for the financial year 2017-18

b) Cost Auditors Pursuant to Section 148 of the

Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the company in respect of its paper, cement and energy activities are required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s Raman & Associates, to audit the cost accounts of the company for the year 2017-18. The cost audit report for the year 2017-18 will be submitted to the Central Government before the due date. Cost Audit report for the financial year 2016-17 was filed in scheduled time.

c) Secretarial Auditor Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s R. Sridharan & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the company. The Report of the secretarial audit is annexed herewith as "Annexure II".

8. NON- CONVERTIBLE DEBENTURES

No Non-Convertible Debentures is outstanding as on 31.03.2018.

9. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1^st June, 2002 and renewals from 1^st August, 2005. During the year under review, the Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptances of Deposits) Rules, 2014.

10. RISK MANAGEMENT FRAMEWORK

TNPL has established a Risk Management Framework under which the risks covering the entire operation have been identified and categorized as high, medium and low.

All the risks are discussed periodically in the Senior Management Committee meetings and appropriate actions are taken pro-actively.

The risk details and mitigation plans are placed before the Audit Committee and the Board, bi-annually.

11. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

TNPL has instituted adequate internal control procedures commensurate with the size of its operations. TNPL has also prepared an ''Internal Control Procedure Manual'' to ensure that the control procedures are followed by all departments. The departments concerned in the company are complying with the stipulations in the manual without deviating the procedures. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company.

Internal controls are supported by internal audit and management reviews. The Audit Committee meets periodically with the Management, External-Internal auditors, Internal auditors, Statutory Auditors and reviews the Annual Audit plans and internal controls. All significant observations of the Auditors are acted upon. The Audit Committee met 7 times during the financial year. The review of Management Response to Audit Observations constitutes an important aspect of the Agenda for each meeting.

12. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The company has framed a Vigil Mechanism / Whistle Blower Policy, the details of such Policy are explained in the Corporate Governance Report and also posted on the website of the Company at www.tnpl.com.

13. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

14. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs, 10,67,769.00 being the Dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 124(5) of the Companies Act , 2013.

15. UNPAID DIVIDEND STATUS

Dividend was remaining unpaid due to non-confirmation of their new addresses by the concerned shareholders. The unpaid dividend warrants were returned by the postal authorities. Effective follow-up by the Company has resulted in Unpaid Dividend being consistently equal or below 0.5% of the total dividend. As and when the shareholders communicate the new address, the dividend is sent to the shareholders. At the end of seven years, the unpaid dividend is transferred to Investor Education and Protection Fund. The table and graph given below summarize the status of Unpaid Dividend.

DIVIDEND STATUS FOR THE LAST 7 YEARS

(? In lakhs)

SL No.	YEAR	SHARE CAPITAL	DIVIDEND %	DIVIDEND AMOUNT	DIVIDEND PAID	DIVIDEND UNPAID AS ON 31.3.2018	% OF PAID DIVIDEND	% OF UNPAID DIVIDEND
1.	2010-11	6921.06	50	3460.53	3449.75	10.78	99.69	0.31
2.	2011-12	6921.06	50	3460.53	3449.31	11.22	99.68	0.32
3.	2012-13	6921.06	50	3460.53	3447.68	12.85	99.63	0.37
4.	2013-14	6921.06	60	4152.63	4136.14	16.49	99.60	0.40
5.	2014-15	6921.06	60	4152.63	4136.13	16.50	99.60	0.40
6.	2015-16	6921.06	75	5190.80	5168.94	21.86	99.58	0.42
7.	2016-17	6921.06	75	5190.80	5164.71	26.09	99.50	0.50

16. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The
particulars required under Sec. 134(3) (m) of the Companies Act 2013, read with the Rule 8 of The Companies (Accounts) Rules, 2014, is furnished in Annexure III to this Report.

17. HEALTH

TNPL is committed to take care of the health of its employees. An Occupational Health Centre is functioning in both the units. In addition, every week, one specialist Doctor in cardiology, General Medicines, Ortho, Skin, Eye, Dental, ENT, etc., visit the occupational Health centre. Entire medical expenses of employees for 7 Serious Ailments viz. Heart ailment, Cancer, Kidney Transplantation, Paralysis, Leprosy, Tuberculosis and Brain Surgery is borne by the Company. A Comprehensive Master health Checkup is done for employees four times at age of 40, 50, 56 and 59. Every year, Audiometry test is conducted to those employees, who are exposed to High noise areas.

18. SAFETY

TNPL has adopted a clearly defined Occupational Health and Safety Policy. Suitable Personal Protective Equipments (PPE) are provided to all employees. Periodical Training Programs are conducted on handling of hazardous chemicals, Material handling, Usage of PPEs, Electrical safety, road safety, First aid,fire fighting etc. to improve safety awareness among the employees including contract workmen. Caution boards, posters, slogans, Do''s and Don''ts etc. are displayed at prominent places to promote safety at work places. Safety Committee with representatives from Management

and Workmen has been constituted. Safety Committee meetings are conducted periodically and suggestions given to improve safety aspects are implemented.

19. PARTICULARS OF EMPLOYEES

None of the employees of the company was in receipt of remuneration in excess of the limits prescribed under the Companies Act, 2013 and the rules framed thereunder. The information as required under Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company, is annexed as Annexure IV.

20. CASH FLOW STATEMENT

As required under Regulation 34(2) (c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a Cash Flow Statement prepared in accordance with the Indian Accounting Standard 7 (IND AS-7) is attached to the Balance Sheet.

21. EXPORT HOUSE STATUS

TNPL has been awarded status of "Three Star Export House" by DGFT - Government of India in accordance with Foreign Trade Policy. This status is valid till 11/10/2020.

22. INDUSTRIAL AND PERSONNEL RELATIONS

The Company continues to have healthy industrial and employee relations at all levels. Despite severe competition, the enthusiasm and unstinting efforts of the employees have enabled the company to remain at the forefront of the Industry.

Your Company continued to receive co-operation and unstinted support from the distributors, retailers, stockists, suppliers and others associated with the Company as its trading partners. The Directors wish to place on record their appreciation for the same and your Company will continue in its endeavor to build and nurture strong links with trade, based on mutuality, respect and co-operation with each other and consistent with consumer interest.

23. ENHANCING SHAREHOLDERS'' VALUE

Your Company believes in the importance of its Members who are among its most important stakeholders. Accordingly, your Company''s operations are committed to the goal of achieving high levels of performance and cost effectiveness, growth building, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its stakeholders by ensuring that its corporate actions have positive impact on the socio-economic and environmental growth and development.

24. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

1. in the preparation of the annual accounts for the year ended 31^st March, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. the directors had selected 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 loss of the company for that period;

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

4. the Annual Accounts were prepared for the financial year ended 31^st March, 2018 on a going concern basis;

5. the directors have laid down proper internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively;

6. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

25. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "Annexure V"

26. MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directors'' Report are attached as "Annexures VI and VII".

As required by the SEBI Regulations, an Auditor''s Certificate on Corporate Governance and a Declaration by the Chairman & Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

27. BUSINESS RESPONSIBILITY REPORT

The ''Business Responsibility Report'' (BRR) of the Company for the year 2017-18 forms part of the Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached as "Annexure VIII"

28. RELATED PARTY TRANSACTIONS

There are no materially significant transactions with related parties during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which are potentially conflicting with the interest of the Company at large.

The Board of Directors have framed the policy on Related Party Transactions and the same is uploaded on the Company''s website.

None of the Directors or Key Managerial Personnel have any pecuniary relationships or transactions vis-a-vis the Company.

Accordingly, the disclosures of Related Party Transactions required under section 134 (3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

29. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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

30. MATERIAL CHANGES OCCURRED AFTER END OF FINANCIAL YEAR

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company''s financial position have occurred between the end of the financial year and date of this report.

31. CEO/CFO CERTIFICATION

As required by Regulation 17(8) of the SEBI Regulation, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended 31^st March,

2018 duly signed by the Managing Director and Chief Financial Officer was submitted to the Board of Directors at their meeting held on 30^th May, 2018.

32. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation for the assistance, co-operation and support extended to the company by the Govt. of Tamil Nadu, Commercial Banks, Financial Institutions, Sugar Mills and Dealers.

The Board also places on record its sincere appreciation of the positive response received from the Company''s valued customers and thanks them for their continued support.

The company is grateful to all employees for their exemplary co-operation during the year. Their contribution has been truly outstanding. The Directors place on record their appreciation of the excellent effort made by every employee to enhance the company''s performance in adverse market conditions.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

33. CAUTIONARY STATEMENT

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. The Company cannot guarantee the accuracy of assumptions and the projected future performance of the Company. The actual results may materially differ from those expressed or implied in this report. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Date: 30.05.2018 For and on behalf of the Board

Place: Chennai K. GNANADESIKAN, IAS

CHAIRMAN

Mar 31, 2017

TO THE MEMBERS

The Companyâs Directors are pleased to present the 37^th Annual Report of the Company along with Audited Accounts for the financial year ended 31^st March, 2017.

1. FINANCIAL RESULTS

The Financial Results for the year under review are summarized below:

(Rs. in Crore)

Particulars	2016-17	2015-16
Revenue from operations (including Excise Duty)	3093.97	2531.51
Other Income	36.95	22.32
Operating Profit (PBIDT/ EBIDTA)	765.91	589.18
Finance cost	252.02	121.84
Gross Profit (PBDT)	513.89	467.34
Depreciation & Amortization expense	207.68	143.77
Profit before tax (PBT)	306.20	323.57
Tax Expense	41.64	63.76
Profit after tax (PAT)	264.56	259.81
Other Comprehensive Income	(7.03)	36.14
Total Comprehensive Income (Net of Taxes)	257.53	295.95
Transfer to General Reserve	190.00	190.00
Dividend including Taxes	62.47	62.47
Surplus carried to Balance Sheet	109.32	97.24

Tamil Nadu where the Companyâs production facilities are located, has witnessed severe drought and water shortage during the year. The water shortage became acute since February 2017. As paper production is highly water intensive, water shortage has affected production since February 2017. The Company lost 25 machine days of paper production, 34 days of Hard Wood Pulp production and 10 days of Chemical Bagasse Pulp production leading to production losses equivalent to 10557 MT of paper, 9180 MT of Hard Wood Pulp and 4700 MT of Chemical Bagasse Pulp during February and March 2017. Your Company has managed the serious unforeseen setback to a larger extent by reducing the fresh water consumption through extensive recycling of process water and implementing contingency plans on time. But for the proactive measures taken by the company, the production loss would have been much higher. Despite the severe hardship, your Company has delivered good results. The Management deserves commendation for their performance.

2. DIVIDEND

The Board of Directors of the Company had approved the Dividend Distribution Policy in line with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy is uploaded on the Companyâs website at http://www.tnpl.com/web_pdf_files/Dividend-Distribution-Policy-TNPL.pdf. Your Directors recommend a dividend of 75% (i.e. Rs 7.50/-per share) for the year ended 31^st March, 2017. The Dividend, if approved by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 19^th September, 2017. The cash outgo on the proposed dividend, will be Rs. 62.47 crore.

3. TRANSFER TO RESERVES

The Company has transferred Rs 190.00 crore to General Reserves out of the amount available for appropriation. Rs 109.32 crore is proposed to be retained in the Profit & Loss Account.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR

a) Operations

1. Sales crossed Rs. 3000 crore mark which is the highest in the Companyâs history.

2. Profit after tax (PAT) of Rs. 264.56 crore exceeded the PAT achieved in 2015-16 by Rs. 4.75 crore (1.8%).

3. During the year the Paper production was 403261 MT.

4. Achieved Highest Paper sales of 415,683 MT during the FY 2016-17 since inception of the company Domestic Sales accounts for 80% and Exports at 20%.

5. The packaging paper board plant commenced commercial production on 1^st May, 2016. Board production during the 11 month period was 83,742 MT, equivalent to 53% of capacity.

6. 312,530 tonnes of Hardwood, chemical Bagasse Pulp and Deinked Pulp were produced during the year.

7. Generated 7128.94 lakh units of power , of which 6923.67 lakh units were internally consumed and 205.27 lakh units exported to the state grid. Power consumed from the State Grid constitutes only 1.61% of total power consumed.

8. The bio-methanation plants have generated methane gas of 68.52 lakh m³ during 2016-17. The methane gas was consumed in lime kiln and power boilers in replacement of furnace oil 3864 KL and imported coal 330 MT.

9. The wind farms with an installed capacity of 35.5MW capacity have generated 512.65 lakh Kwh Units of âGreen Powerâ during the year.

10. The Paper & pulp mill have implemented various water conservation projects and reduced the overall consumption of water to about 40 KL Per ton of paper which is one of the lowest in paper industry.

11. TNPL is the First and only company in the Indian Paper Industry to have established a cement manufacturing factory to convert the mill wastes limesledge and flyash into high grade cement as part of its solid waste management system. During the year, the Company has manufactured 234,676 MT of cement.

12. The company has repaid Term Loans amounting to Rs. 154.19 crore during the financial year 2016-17 as per schedule.

13. Market Capitalization crossed Rs. 2716.17 Cr. mark first time during the year on 13.10.2016. Market Capitalization as on 31.03.2017 was Rs. 2179.44 Cr.

b) New Projects Implemented:

1) TNPL Unit II - Multilayer double coated Paper Board project

Your Company has set up a Multi Layer Coated Board Plant of a capacity of 2 Lakhs MT per annum during the financial year 2015-16 and commenced the commercial production from 1^st May 2016. The initial teething problems faced in the Board machine have been attended and the Board production has been stabilized. Your company is poised to achieve higher board production from 2017-18 onwards.

2) Conversion Centre of Paper and Packaging Board (CCPPB)

Your Company has established a âConversion Centre of Paper and Packaging Board (CCPPB) Unitâ at Mayanur in Karur District. During the financial year 2016-17, your Company has set upon a Core manufacturing unit for manufacturing Core pipes required for our plants viz. Unit I and Unit II. In addition, an entrepreneur has set up a poly coating unit in the Centre.

Your Company is taking steps to set up few more small sized manufacturing units in this campus.

PROJECTS UNDER IMPLEMENTATION

Capacity Expansion of TNPL Unit II

As part of the growth plan, TNPL has embarked on a Mill Expansion Plan (MEP) in Unit II for producing 1,65,000 MT of paper per annum by way of installing a state-of- the art Paper Machine, a 400 tpd chemical hardwood pulp mill with chemical recovery boiler, augmentation of Captive power plant and Waste water treatment plant and other auxiliaries at a total capital outlay of Rs.2,100 crores.

TNPL has filed an application with Ministry of Environment. Forest and Climate Change (MOEFCC), for obtaining Environment Clearance(EC). MOEFCC has approved the Terms of Reference for conducting Environment Impact Assessment study. The study has been commenced. The EC for the project is expected to be secured by March 2018. The project will be taken up for implementation during April 2018 and completed by June 2020.

Installation of Roll grinding machine in TNPL Unit II

A new Roll grinding machine is being installed in TNPL Unit II, at a capital outlay of Rs.25 Crore. Civil works are in progress. The Roll Grinding Machine will be commissioned by October 2017.

Installation of additional Electrostatic Precipitator for Recovery Boiler in TNPL - Unit I

The recovery boiler is currently provided with a twin chamber Electrostatic precipitator (ESP) to control the particulate emissions to less than 50 mg/NM³. An additional ESP chamber, is being installed to improve the overall operational efficiency of the Recovery Boiler. Civil works are in progress. The project will be completed by November 2017.

c) Contribution to Environment

1) During the year 2016-17, M/s TuV India Limited, a subsidiary of TuV NORD, Germany carried out a Surveillance Audit of TNPLâs Environmental/ Quality Management System and awarded a certificate valid till Febâ 2020

2) The Company has received a âGreen-Co Gold Ratingâ from Confederation of Indian Industry -Godrej Green Business Centre (CII - Godrej GBC), Hyderabad. TNPL is the 2^nd Paper manufacturing unit and 1^st Agro based Paper Manufacturing Company in Indiaâ to have undergone Green Co Rating System and received the prestigious âGreen-Co Gold ratingâ.

3) Production of 1.61 Lakh MT of bagasse pulp and 68,700 MT of Deinked pulp during the year has facilitated conservation of 10.56 Lakh MT of pulpwood.

4) The âWorld Environment Dayâ was celebrated on 05/06/16 in both the units involving school children in planting trees.

5) 7180 MT of carbon dioxide content in the Flue gas generated in the cement mill has been consumed in the PCC plant for producing 16319 MT of PCC.

6) The treated effluent water of Unit I is used for irrigation of around 1700 acres of land under TNPL Treated Effluent Water Lift Irrigation Scheme (TEWLIS) and 306 acres of land under Captive Plantation scheme.

7) About 6,80,000 tree saplings of various species have been planted in 570 acres of land in Unit II and the surrounding areas of the factory. The treated effluent water of Unit II is used for irrigation of these saplings through drip irrigation system. The massive plantation has become an excellent green cover in the area.

8) The Company has generated about 512.65 Lakh KWH Wind energy during 2016-17.

9) 68.52 Lakh m³ methane generated in the Bio-methanation plant was consumed in lime kiln and Power Boilers saving 3864 KL of Furnace oil and 330 Mt of imported coal.

d. Corporate Social Responsibility(CSR)

The Company has undertaken CSR activities as per the CSR policy (available on your companyâs website www.tnpl. com) The details are contained in the Annual Report on CSR activities vide Annexure - I, forming part of this Report.

The âCorporate Social Responsibility Committeeâ comprises of four Independent Directors who monitor the CSR activities. TNPLâs CSR activities are implemented mostly in the villages / Town Panchayats located in the vicinity of TNPL plants. TNPL spends 2% of the average net profit of the previous three years for CSR initiatives. The CSR activities are mainly focused on Education, Health care, Socio-economic development, Environmental sustainability and Culture & Heritage promotion. The Company has spent Rs.505.00 lakhs for CSR activities during the year 2016-17.

e. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R&D activities which are carried out largely in-house. A few activities are outsourced when warranted.

2. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

3. The company has spent Rs. 9.35 Crore on R & D activities during the year.

f. Awards

- TNPL has bagged the âIPMA Paper Mill of the Year awardâ for the year 2015-16 from Indian Paper Manufacturersâ Association (IPMA), New Delhi. This award is given once in two years for the overall best performance in Industry. TNPL has received this prestigious award five times out of seven occasions and three times in a row.

- Dun & Bradstreet Mumbai has selected TNPL as the âTop Indian Company under the sector Paper & Pulp for âDun & Bradstreet Corporate Awards 2017â, sixth time in a row.

- TNPLâs project âLime Sludge and Fly ash Management (LSFM) Systemâ has been selected and awarded âMost Innovative Projectâ award for the âBest Practices in Waste Management during GreenCo Best Practices Award 2016 competition conducted by CII-Sohrabji Godrej Green Business Centre, Hyderabad on 15^th June, 2016 at Hyderabad.

- During the year, the company received the Top Export Award for the year 2014-15 from CAPEXIL (Chemicals & Allied Products Export Promotion Council of India). in recognition of the companyâs export achievement in respect of Paper, Paper Board & Paper Products Panel.

5. MARKET TRENDS

a) General

Total installed capacity of Indian Paper Industry is approximately 13.5 Million Metric Tonnes and average capacity utilization is 90%. Overall consumption inclusive of imports and net of exports is about 14.70 million metric tonnes.

The average per capita consumption in India is around 11 kgs against the global average consumption of 56 kgs. The growth rate of paper across the globe is around 1.5%. With the consistent economic growth and greater emphasis for education, the demand growth is estimated at 6%, consisting of 4% in Printing and Writing paper, 12% in Industrial and Packaging Board, 3-4 % in newsprint and specialty papers. Excise duty on paper remains at 6%. Basic Customs duty is levied at 10% for printing and writing paper & Boards. Imports from countries covered under Free Trade Agreements (FTA), are levied basic customs duty at zero percent.

b) Printing & Writing Paper

During 2010 and 2011, many mills in the country had added capacity. Supplies exceeded demand and prices dropped. Paper Industry faced acute shortage of pulpwood during 2013. Few mills resorted to importing pulpwood at higher prices. With the steep increase in input costs, paper prices rose during 2013. However, with the paper prices softening in the international market and import of paper in large volume under Free Trade Agreements (FTA), paper prices dropped sharply during 2014 and 2015. The Indian paper industry faced unprecedented challenges both on cost front and market front for two consecutive years 2014 & 2015. The market recovered and stabilised during 2016-17 due to consistent growth in demand and sudden drop in supplies. The shortage in supplies was met through imports mainly from Indonesia and China.

c) Packaging Boards

The market for Packaging Board is estimated at 3.00 Million tonnes. Grey-Back Board account for 1.35 Million tonnes (45%), White-back and other high-end varieties (FBB, SBS, Cup Stock.) account for the remaining 1.65 million tonnes (55%). The demand growth for packaging boards is estimated at 12% per annum.

d) Outlook

At the current estimated demand growth at 6% per annum, the domestic consumption is expected to reach 25.30 million metric tonnes per annum by 2024-25. This offers a good opportunity for capacity addition.

e) TNPLâs response to Market Trends

6. DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors have extended the service of Thiru A Velliangiri as Deputy Managing Director on contract basis from 01.04.2017 to 31.03.2018 and his appointment is subject to approval of shareholders in the forthcoming Annual General Meeting.

On completion of the first term ended on 31.03.2017, the Board re-appointed the following Directors as Independent Director for the second term with effect from 01.04.2017 to 31.03.2020. Their appointment is subject to approval of shareholders in the forthcoming Annual General Meeting:

1. Thiru V. Narayanan

2. Thiru N Kumaravelu

3. Thiru M R Kumar

4. Thiru V Nagappan

Tmt. Sarada Jagan, Independent Director has ceased to be Director of the company from 01.04.2017 on completion of her tenure as she did not offer herself for re-appointment.

Thiru V. Kumaravelu re-appointed as mentioned above for three years has resigned from directorship and his resignation was accepted by the Board w.e.f. 19.04.2017.

Pursuant to order of the Government of Tamil Nadu the Board co-opted Thiru Atulya Misra, IAS as Additional Director and designated him as Chairman of the Company. Thiru Atulya Misra, IAS will hold the office upto the date of forthcoming Annual General Meeting and he is eligible for appointment as a Director of the Company.

The Govt. vide same order appointed Dr. R. Selvaraj, IAS as Managing Director of TNPL in place of Thiru Vikram Kapur, IAS with effect from 20^th April 2017. Accordingly, Thiru Vikram Kapur, IAS ceased to be Director of the Company w.e.f 20^th April 2017. Dr. R. Selvaraj, IAS, was co-opted as Additional Director on the Board of the Company who holds office upto the date of the ensuing Annual General Meeting and his appointment is subject to the approval of the Shareholders in the Annual General Meeting.

6.1 Declaration from Independent Directors on Annual Basis

The Independent directors have submitted their disclosure to the Board confirming that they fulfill all the requirements as to qualify for their appointment as an Independent Director under the provisions of Section 149 of the Companies Act, 2013 as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, hereinafter referred to as SEBI Regulations. The Board confirms that the said independent directors meet the criteria as laid down under the Companies Act, 2013 as well as SEBI Regulations.

6.2 Remuneration Policy

6.3 Meetings

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year, eight meetings of each Board and Audit Committee were convened and held, the details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Regulation 17(2) of the SEBI Regulations.

6.4 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI Regulations, the Board has internally carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees for the financial year ended 31^st March, 2017. The guidance note dated January 5, 2017 as suggested by SEBI was referred to while carrying out the annual performance evaluation. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boardâs functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board on the following broad criteria i.e. attendance and level of participation at meetings of the Board/Committees, independence of judgement exercised by Independent Directors, interpersonal relationship etc.

The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors in their meeting held on 24.03.2017. The Directors expressed their satisfaction with the evaluation process.

7. INTERNAL COMPLAINTS COMMITTEE

As per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 & Rules made thereunder, the Company has constituted an Internal Complaints Committee (ICC) and following are the members :-

(i) Tmt. R.S.Tamilarasy, Manager (Lab) - Presiding Officer

(ii) Thiru. P.Sundaram, Manager - HR (Member)

(iii) Tmt. M.PemilaBeham, Assistant Officer - HR (Member)

(iv) Thiru. M.Velliangiri, President, Kanmani Trust, Karur -Member representing NGO

The above members are committed to the cause of women and they possess experience in social work and legal knowledge. During the year under review there were no complaints referred to the Committee.

8. AUDITORS

a) Statutory Auditors The Comptroller and Auditor General of India appointed M/s. Raman Associate, Chartered Accountants, Chennai, as the Statutory Auditors of the Company for the financial year 2016-17

b) Cost Auditors Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the company in respect of its paper, cement and energy activities are required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s Raman & Associates, to audit the cost accounts of the company for the year 2016-17. The cost audit report for the year 2016-17 will be submitted to the Central Government before the due date. Cost Audit report for the financial year 2015-16 was filed in scheduled time.

9. NON- CONVERTIBLE DEBENTURES

No Non-Convertible Debentures is outstanding as on 31.03.2017.

10. FIXED DEPOSITS

11. RISK MANAGEMENT FRAMEWORK

TNPL has established a Risk Management Framework under which the risks covering the entire operation have been identified and categorized as high, medium and low.

All the risks are discussed periodically in the Senior Management Committee meetings and appropriate actions are taken pro-actively.

The risk details and mitigation plans are placed before the Audit Committee and the Board, bi-annually.

12. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

TNPL has instituted adequate internal control procedures commensurate with the size of its operations. TNPL has also prepared an âInternal Control Procedure Manualâ to ensure that the control procedures are followed by all departments. The departments concerned in the company are complying with the stipulations in the manual without deviating the procedures. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company.

Internal controls are supported by internal audit and management reviews. The Audit Committee meets periodically the Management, External-Internal auditors, Internal auditors, Statutory Auditors and reviews the Annual Audit plans and internal controls. All significant observations of the Auditors are acted upon. The Audit Committee met 8 times during the financial year. The review of Management Response to Audit Observations constitutes an important aspect of the Agenda for each meeting.

13. VIGIL MECHANISM / WHISTLE BLOWER POLICY

14. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

15. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs. 7,59,605/-being the Dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A (5) of the Companies Act , 1956.

16. UNPAID DIVIDEND STATUS

Dividend was remaining unpaid due to non-confirmation of their new addresses by the concerned shareholders. The unpaid dividend warrants were returned by the postal authorities. Effective follow-up by the Company has resulted in Unpaid Dividend being consistently below 0.5% of the total dividend. As and when the shareholders communicate the new address, the dividend is sent to the shareholders. At the end of seven years, the unpaid dividend is transferred to Investor Education & Protection Fund. The table and graph given below summarize the status of Unpaid Dividend.

DIVIDEND STATUS FOR THE LAST 7 YEARS

(Rs. In lakhs)

SL No.	YEAR	SHARE CAPITAL	DIVIDEND %	DIVIDEND AMOUNT	DIVIDEND PAID	DIVIDEND UNPAID AS ON 31.3.2017	% OF PAID DIVIDEND	% OF UNPAID DIVIDEND
1.	2009-10	6921.06	45	3114.48	3103.68	10.80	99.65	0.35
2.	2010-11	6921.06	50	3460.53	3449.61	10.92	99.68	0.32
3.	2011-12	6921.06	50	3460.53	3449.09	11.44	99.67	0.33
4.	2012-13	6921.06	50	3460.53	3447.48	13.05	99.62	0.38
5.	2013-14	6921.06	60	4152.63	4135.91	16.72	99.60	0.40
6.	2014-15	6921.06	60	4152.63	4135.88	16.75	99.60	0.40
7.	2015-16	6921.06	75	5190.80	5170.88	19.92	99.62	0.38

17. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 134(3) (m) of the Companies Act 2013, read with the Rule 8 of The Companies (Accounts) Rules, 2014, is furnished in Annexure III to this Report.

18. HEALTH

TNPL is committed to take care of the health of its employees. An Occupational Health Centre is functioning in both the units. In addition, every week, one specialist Doctor in cardiology, General Medicines, Ortho, Skin, Eye, Dental, ENT, etc., visit the occupational Health centre. Entire medical expenses of employees for 7 Serious Ailments viz. Heart ailment, Cancer, Kidney Transplantation, Paralysis, Leprosy, Tuberculosis and Brain Surgery is borne by the Company. A Comprehensive Master health Check-up is done for employees four times at age of 40, 50, 56 and 59. Every year, Audiometry test is conducted to those employees, who are exposed to High noise areas.

19. SAFETY

TNPL has adopted a clearly defined Occupational Health and Safety Policy. Suitable Personal Protective Equipments (PPE) are provided to all employees. Periodical Training Programs are conducted on handling of hazardous chemicals, Material handling, Usage of PPEs, Electrical safety, Road safety, First aid, fire fighting etc. to improve safety awareness among the employees including contract workmen. Caution boards, posters, slogans, Doâs and Donâts etc. are displayed at prominent places to promote safety at work places. Safety Committee with representatives from Management and Workmen has been constituted. Safety Committee meetings are conducted periodically and suggestions given to improve safety aspects are implemented.

20. PARTICULARS OF EMPLOYEES

21. CASH FLOW STATEMENT

As required under Regulation 34(2) (c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a Cash Flow Statement prepared in accordance with the Indian Accounting Standard 7 (IND AS-7) is attached to the Balance Sheet.

22. EXPORT HOUSE STATUS

TNPL has been awarded status of âThree Star Export Houseâ by DGFT -Government of India in accordance with Foreign Trade Policy. This status is valid till 11/10/2020.

23. INDUSTRIAL AND PERSONNEL RELATIONS

24. ENHANCING SHAREHOLDERSâ VALUE

Your Company believes in the importance of its Members who are among its most important stakeholders. Accordingly, your Companyâs operations are committed to the goal of achieving high levels of performance and cost effectiveness, growth building , enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its stakeholders by ensuring that its corporate actions have positive impact on the socio-economic and environmental growth and development.

25. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to Directorsâ Responsibility Statement, it is hereby confirmed that:

1. in the preparation of the annual accounts for the year ended 31^st March, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

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

4. the Annual Accounts were prepared for the financial year ended 31^st March, 2017 on a going concern basis;

5. the directors have laid down proper internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively;

6. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as âAnnexure Vâ

27. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directorsâ Report are enclosed as âAnnexures VI and VIIâ.

As required by the SEBI Regulations, an Auditorâs Certificate on Corporate Governance and a Declaration by the Chairman & Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

28. BUSINESS RESPONSIBILITY REPORT

The âBusiness Responsibility Reportâ (BRR) of the Company for the year 2016-17 forms part of the Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as âAnnexure VIIIâ

29. RELATED PARTY TRANSACTIONS

There are no materially significant transactions with related parties during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which are potentially conflicting with the interest of the Company at large.

The Board of Directors have framed the policy on Related Party Transactions and the same is uploaded on the Companyâs website.

None of the Directors or Key Managerial Personnel have any pecuniary relationships or transactions vis-a-vis the Company.

Accordingly, the disclosures of Related Party Transactions required under section 134 (3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

30. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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

31. MATERIAL CHANGES OCCURRED AFTER END OF FINANCIAL YEAR

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companyâs financial position have occurred between the end of the financial year and date of this report.

32. CEO/CFO CERTIFICATION

As required by Regulation 17(8) of the SEBI Regulation, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31, 2017 duly signed by the Chairman & Managing Director and Deputy Managing Director was submitted to the Board of Directors at their meeting held on May 29, 2017.

33. ACKNOWLEDGEMENT

The Board also places on record its sincere appreciation of the positive response received from the Companyâs valued customers and thanks them for their continued support.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

34. CAUTIONARY STATEMENT

Statements in the Boardâs Report and the Management Discussion & Analysis describing the Companyâs objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. The Company cannot guarantee the accuracy of assumptions and the projected future performance of the Company. The actual results may materially differ from those expressed or implied in this report. Important factors that could influence the Companyâs operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

Date: 29^th May, 2017 For and on behalf of the Board

Place: Chennai ATULYA MISRA IAS

CHAIRMAN

Mar 31, 2016

TO THE MEMBERS

The Company''s Directors are pleased to present the 36th Annual Report of the Company along with Audited Accounts for the financial year ended 31st March, 2016.

1. FINANCIAL RESULTS

The Financial Results for the year under review are summarized below:

(Rs. in crore)

Particulars	2015-16	2014-15
Revenue from operation	2417.54	2135.73
Other income	16.77	16.64
Operating Profit (PBIDT)	596.00	522.36
Finance cost	139.30	154.93
Gross Profit (PBDT)	456.70	367.43
Depreciation	139.47	137.30
Profit before tax	317.23	230.13
Provision for tax	63.31	63.40
Profit after tax	253.92	166.73
Balance brought forward	31.31	27.12
Less : Adjustment	-	7.14
Profit Available for	285.23	186.71
appropriation
APPROPRIATIONS
Transfer to General Reserve	190.00	100.00
Debenture Redemption Reserve	-	5.42
Proposed Dividend	51.91	41.53
Tax on Dividend	10.56	8.45
Balance carried forward	32.76	31.31
	285.23	186.71

During the entire year, Indian Paper Industry was under severe stress due to poor market conditions and drop in prices. Despite this your company has achieved good results. The Management deserves commendation for their performance.

2. DIVIDEND

Your Directors recommend a dividend of 75% (i.e. Rs. 7.50 per share) for the year ended 31^st March, 2016. The Dividend, if approved by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 28^th September, 2016. Expenditure on the proposed dividend, will be Rs. 62.47 crore inclusive of taxes.

3. TRANSFER TO RESERVES

The Company has transferred Rs. 190 crore to General Reserves out of the amount available for appropriation. Rs. 32.76 crore is proposed to be retained in the Profit & Loss Account.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR

a) Operations

1. Sales and Profit, reached record levels and are the highest in the Company''s history.

2. Sales and other income crossed Rs. 2400 crore mark for the First time.

3. Profit before tax of Rs. 317.23 crore is higher by Rs. 87.11crore (37.85%) compared to the previous year.

4. Profit after tax of Rs. 253.92 crore exceeded the PAT achieved in 2014-15 by Rs.87.19 crore (52.29%).

5. Production of paper 403430 MT is the highest ever achieved.

6. Paper sales also is the highest at 407353 MT with the mix of Domestic sales 82% and Export 18%.

7. Generated 6284.30 lakh units of power of which 5956.25 lakh units were consumed and 328.05 lakh units were exported to the state grid. Power drawn from State Grid constitutes only 1.70% of total power consumed.

8. Received 106147 number of Renewable Energy Certificates (REC) for power generated from the steam produced in the recovery boiler. 68496 RECs were sold during the year generating revenue of Rs.10.27 crore. 234029 RECs remaining unsold on cumulative basis have been carried forward for sales during 2016-17.

9. The bio-methanation plants have generated cumulatively 75.66 lakh m3 of methane gas during 2015-2016. The methane gas was consumed in lime kiln and power boilers in replacement of 4438.86 KL furnace oil and 238.23 MT of imported coal.

10. The wind farms with an installed capacity of 35.5 MW have generated 319.83 lakh Kwh Units of ''Green Power''.

11. The Company has implemented farm forestry and captive plantation in 1,12,865 acres of land benefiting 22,215 farmers in 29 districts of Tamil Nadu.

12. The mill has implemented various water conservation projects and reduced overall water consumption to about 40 KL Per ton of paper during 2015 -2016 which is one of the lowest in paper industry.

13. Manufactured 196573 tonnes of cement during the year. TNPL is the First and only company in the Paper Industry to convert mill wastes into high grade cement.

14. The company has repaid Term Loans amounting to Rs. 215.88 crore on scheduled dates.

b) New Projects Implemented:

1) TNPL Unit II - Multilayer Double Coated Paper Board project

The company has set up a state-of-the-art Multilayer Double Coated Board Plant with an annual capacity of 200,000 MT per annum as a green field project in Mondipatti village, Manaparai taluk, Trichy District.

The project features a Board machine complex to produce 200,000 MT per annum multilayer coated board, a 30 MW Power plant other support infrastructures like Power intake sub-station, Water treatment, Waste water treatment, air compressors, Mill wide air conditioning system, etc.

The Greenfield project with the above features has been executed in 22 months - a record for any project in Indian Paper Industry. Test run was started in February, 2016.

2) Up gradation of Lime sludge and Fly Ash Management (LSFM) System - Enhancing of cement production capacity from 600 tpd to 900 tpd

The capacity of LSFM plant was increased from 600 tpd to 900 tpd. The Project was completed in a record time of 9 months from the date of commencement of the Project.

3) Conversion Centre of Paper and Packaging Board (CCPPB)

The Company has setup a "Conversion Centre of Paper and Packaging Board (CCPPB) Unit" in the 38.40 acres of land in Mayanur in Karur District. An industrial shed measuring 1,20,000 square feet has been made ready for occupation. A Core manufacturing unit and a Poly Coating unit will be set up in the premises before 31.07.2016.

c) Contribution to Environment

1) During January, 2016, M/s TuV India Limited, a subsidiary of TuV NORD, Germany carried out the second Surveillance Audit of TNPL''s Environmental Management System and recommended to maintain the certificate till Feb''

2017 as TNPL is conforming to the requirements of ISO 14001:2004 standards.

2) The Company has received the "Green-Co Gold Rating" from Confederation of Indian Industry -Godrej Green Business Centre (CII - Godrej GBC), Hyderabad. TNPL is the 2nd Paper manufacturing unit and 1st Agro based Paper Manufacturing Company in India to have undergone Green Co Rating System and received the prestigious "Green-Co Gold rating".

3) Production of 1.67 Lakh MT of bagasse pulp and 42,705 MT of Deinked pulp during the year has facilitated conservation of 9.03 Lakh MT of pulpwood.

4) TNPL celebrated the "World Environment Day" on 05/06/15 in both the Units involving school children planting trees.

5) Flue gas generated in the cement mill is consumed in the PCC plant.

6) Treated effluent water of Unit I is used for irrigation of around 1700 acres of land under TNPL Treated Effluent Water Lift Irrigation Scheme (TEWLIS) and 306 acres of land under Captive Plantation scheme.

7) About 6,80,000 tree saplings of various species have been planted in 570 acres of land in Unit II and the surrounding areas of the factory. The treated effluent of Unit II is used for irrigation of these saplings through drip irrigation system.

8) The Company has generated about 319.83 Lakh KWH Wind energy during 2015-16.

9) 75.66 Lakh m³ methane generated in the Bio-meth nation plant was consumed in lime kiln and Power Boilers saving 4438.86 KL of Furnace oil and 238.23 Mt of imported coal.

d. Corporate Social Responsibility (CSR)

The company has constituted "Corporate Social Responsibility Committee" comprising of Five Independent Directors. The Committee monitors CSR activities.

The Company aims to spend 2% of the average net profit of the company before tax in the last three financial years. The company has spent Rs. 3.69 crore on CSR activities during the year under review.

The Company has undertaken CSR activities as per the CSR policy (available on your company''s website www. tnpl.com) The details are contained in the Annual Report on CSR activities vide Annexure - I, forming part of this Report. The CSR activities are mainly focused on Education, Health care, Socio-economic development, Environmental sustainability and Culture & Heritage promotion.

e. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R & D activities which are carried out largely in-house. A few activities are outsourced when warranted.

2. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

3. The company spent Rs. 7.89 Crore on R & D activities during the year.

f. Awards

- Dun & Bradstreet Mumbai has selected TNPL as the Top Indian Company under the sector Paper and Board products for "Dun & Bradstreet Award 2016". TNPL has received this award for the Fifth time in a row.

- Indian Chamber of Commerce (ICC) has bestowed on TNPL the "Water Stewardship Award 2016" as part of its Corporate Governance and Sustainability Vision Awards.

5. MARKET TRENDS

a) General

The installed capacity of the Indian Paper Industry is approximately 13.50 Million tonnes. The average capacity utilization is 90%. The overall consumption inclusive of imports and net of exports is 13.88 million tonnes.

The average per capita consumption in India is around 11 Kgs against the global average consumption of 56 Kgs. The growth rate for paper across the globe is around 1.5%. With the consistent economic growth and greater emphasis on education, the growth rate for paper in India is around 6%, consisting of 4% in Printing & Writing Paper, 12% in Industrial and Packaging Boards, 3-4% in newsprint and specialty papers. Excise duty on paper remains at 6%. Customs duty is levied at 10% for printing and writing paper. However, printing and writing paper imported from countries covered under Free Trade Agreements (FTA), are levied custom duty at zero percent.

b) Printing & Writing Paper

Between 2010 and 2011, many mills in the country had added capacity. Supplies exceeded demand and prices dropped. Paper Industry faced scarcity in pulpwood supplies during 2013. Few mills imported pulp wood at higher prices. With the steep increase in input costs, paper prices increased during 2013. However, with the paper prices softening in the international market and import of paper in large volume under Free Trade Agreements (FTA), paper prices fell sharply during 2014 and 2015. The Indian paper industry faced unprecedented challenges both on cost front and market front for two consecutive years (2014 and 2015).

With seasonal demand from the Educational Sector and positive sign in the economic growth, the market has started showing signs of improvement since February 2016.

c) Packaging Boards

The market for Packaging Board is estimated at 2.68 Million tonnes. Grey-back Boards account for 1.21 Million tonnes (45%), White-back and other high-end varieties (FBB, SBS, Cup Stock, etc.) account for the remaining 1.47 Million tonnes (55%) . The demand for packaging boards is estimated at 12% per annum.

d) Outlook

With the demand growth anticipated at 6% per annum, the domestic consumption is expected to reach 25.30 Million Mt per annum by 2024-25. There is good potential for adding capacity in Paper and Boards.

e) TNPL response to Market Trends

TNPL has always been in the forefront matching its capability, capacity and performance in line with the overall trends in the industry. TNPL has increased its production capacity consistently. With the recently commissioned board plant, the total production capacity of the company has increased to 6 lakh MT.

6. DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors have extended the service of Thiru A Velliangiri as Deputy Managing Director on contract basis from 19th December, 2015 to 31st March, 2017 and his appointment is subject to approval of shareholders in the forthcoming Annual General Meeting.

Thiru R. Mani, Director (Operations) has ceased to be Director of the Company on 26.02.2016 on completion of his contractual period.

Pursuant to the order of Government of Tamil Nadu dated 24.06.2016, Thiru K. Shanmugam, IAS was appointed as Director on the Board in place of Thiru T. Udhayachandran, IAS. The Government vide order dated 04.08.2016, nominated Dr. Rajeev Ranjan, IAS as Chairman and Managing Director, TNPL in place of Thiru C.V. Sankar, IAS. The Board appointed Thiru N. Narayanan, IAS (Retd.) as Additional (Independent) Director w.e.f. 14.07.2016. These Directors were coopted as Additional Directors on the Board of the Company who hold office upto the date of the ensuing Annual General Meeting and their appointment is subject to the approval of the Shareholders in the Annual General Meeting.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Thiru Mahesan Kasirajan IAS, Director retires by rotation at the forthcoming Annual General Meeting. He is eligible for reappointment as Director.

6.1 Declaration from Independent Directors on Annual Basis

6.2 Remuneration Policy

6.3 Meetings

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year, six meetings of each Board and Audit Committee were convened and held, the details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Clause 49 of the Listing Agreement/Regulation 17(2) of the SEBI Regulations.

6.4 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the SEBI Regulations, 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 Audit and Nomination & Remuneration Committees. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors in their meeting held on 28.03.2016. The Directors expressed their satisfaction with the evaluation process.

7. INTERNAL COMPLAINTS COMMITTEE

As per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 & Rules made there under, the Company has constituted an Internal Complaints Committee (ICC) and following are the members :-

(i) Tmt.R.S.Tamilarasy, Manager (Lab) â Presiding Officer

(ii) Thiru.P.Sundaram, Manager - HR (Member)

(iii) Tmt.M.Pemila Beham, Assistant Officer - HR (Member)

(iv) Thiru.M.Velliangiri, President, Kanmani Trust, Karur - Member representing NGO

The above members are committed to the cause of women and they possess experience in social work and legal knowledge. During the year under review there were no complaints referred to the Committee.

8. AUDITORS

a)Statutory Auditors The Comptroller and Auditor

General of India appointed M/s. Raman Associate, Chartered Accountants, Chennai, as the Statutory Auditors of the Company for the financial year 2015-16

b) Cost Auditors Pursuant to Section 148 of the

Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the company in respect of its paper, cement and energy activities are required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s Raman & Associates, to audit the cost accounts of the company for the year 2015-16. The cost audit report for the year 201516 will be submitted to the Central Government before the due date. Cost Audit report for the financial year 2014-15 was filed in scheduled time.

d) Comment of The Comptroller & Auditor Comptrollers Auditor General of India has given his General of India(C&AG) comment under Section 143(6)

(b) of the Companies Act, 2013. The comment of C&AG along with Management''s reply thereon is placed in this Annual Report.

9. NON- CONVERTIBLE DEBENTURES

During the year, the Company has redeemed fully the 11% Non-Convertible Debentures Series- I aggregating Rs. 5.56 Crore (including interest). No Non-Convertible Debentures is outstanding as on 31.03.2016.

10. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1st June, 2002 and renewals from 1st August, 2005. During the year under review, the Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptances of Deposits) Rules, 2014.

11. RISKMANAGEMENTFRAMEWORK

TNPL has established a Risk Management Framework under which the risks covering the entire operation have been identified and categorized as high, medium and low.

All the risks are discussed periodically in the Senior Management Committee meetings and appropriate actions are taken pro-actively.

The risk details and mitigation plans are placed before the Audit Committee and the Board, bi-annually.

12. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

TNPL has instituted adequate internal control procedures commensurate with the size of its operations. TNPL has also prepared an ''Internal Control Procedure Manual'' to ensure that the control procedures are followed by all departments. The departments concerned in the company are complying with the stipulations in the manual without deviating the procedures. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company.

DIVIDEND STATUS FOR THE LAST 7 YEARS

(Rs. In lakhs)

SL No.	YEAR	SHARE CAPITAL	DIVIDEND %	DIVIDEND AMOUNT	DIVIDEND PAID	DIVIDEND UNPAID AS ON 31.3.2016	% OF PAID DIVIDEND	% OF UNPAID DIVIDEND
1	2008-09	6921.06	45	3114.48	3106.87	7.61	99.76	0.24
2	2009-10	6921.06	45	3114.48	3103.56	10.92	99.65	0.35
3	2010-11	6921.06	50	3460.53	3449.45	11.08	99.68	0.32
4	2011-12	6921.06	50	3460.53	3448.89	11.64	99.66	0.34
5	2012-13	6921.06	50	3460.53	3447.26	13.27	99.62	0.38
6	2013-14	6921.06	60	4152.63	4135.55	17.08	99.59	0.41
7	2014-15	6921.06	60	4152.63	4135.30	17.33	99.58	0.42

Internal controls are supported by internal audit and management reviews. The Audit Committee meets periodically the Management, External-Internal auditors, Internal auditors, Statutory Auditors and reviews the Annual Audit plans and internal controls. All significant observations of the Auditors are acted upon. The Audit Committee met 6 times during the financial year. The review of Management Response to Audit Observations, constitutes an important aspect of the Agenda for each meeting.

13. VIGIL MECHANISM I WHISTLE BLOWER POLICY

14. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

15. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs.5,36,052/- being the Dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A (5) of the Companies Act , 1956.

16. UNPAID DIVIDEND STATUS

Dividend was remaining unpaid due to non-confirmation of their new addresses by the concerned shareholders. The unpaid dividend warrants were returned by the postal authorities. Effective follow-up by the Company has resulted in Unpaid Dividend being consistently below 0.5% of the total dividend. As and when the shareholders communicate the new address, the dividend is sent to the shareholders. At the end of seven years, the unpaid dividend is transferred to Investor Education & Protection Fund. The table and graph given summarize the status of Unpaid Dividend.

17. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 134(3)(m) of the Companies Act 2013, read with the Rule 8 of The Companies (Accounts) Rules, 2014, is furnished in Annexure III to this Report.

1 8. HEALTH

An Occupational Health Centre is functioning round-the-clock in housing colony with Five Medical Officers, Three Nurses and Nine Attendees to render Medical Assistance for the employees and their dependents. In addition, on every Sunday, Specialist Doctors in Cardiology, General Medicines, Ortho, Skin, Gynecology, Eye, Dental, ENT, Psychiatry, etc., visit the Occupational Health Centre.

TNPL has identified Heart Ailment, Cancer, Kidney Transplantation, Paralysis, Leprosy, Tuberculosis and Brain Surgery as serious ailments. The company bears the entire medical expenses of the employees for all the seven serious ailments.

In all other cases 50% of the hospitalization expenses incurred for the employees and their dependents are borne by the company.

Comprehensive Master Health Check-up is being carried out for employees thrice in their service period i.e at age of 40 years, 50 years and above 56 years. Eudiometry test is conducted every year to those employees, who are exposed to High noise areas. Once in 2 years, Eye test is being carried out for employees, who are in driving job. TNPL is committed to the health of employees thereby ensuring for better productivity.

19. SAFETY

TNPL has adopted a clearly defined Occupational Health and Safety Policy. Suitable Personal Protective Equipments (PPE) are provided to all employees. Periodical Training Programs are conducted on handling of hazardous chemicals, Material handling, Usage of PPEs, fire fighting etc. to improve safety awareness among the employees including contract workmen. Caution boards, posters, slogans, Do''s and Don''ts etc. are displayed at prominent places to promote safety at work places. Periodical medical checkups are organized for the employees to identify occupational health hazards. Safety Committee with representatives from Management and Workmen has been constituted. Safety Committee meetings are conducted periodically and suggestions given to improve safety aspects are implemented.

Accidents and incidents are investigated and preventive / corrective actions are taken to avoid recurrence. Mill wide Safety Audit, HAZOP study and Risk Analysis are carried out periodically through experts in industrial safety and the recommendations are implemented. Material Safety Data Sheet (MSDS) for hazardous chemicals used in the mill are displayed at storage areas. Testing of Pressure Vessels, Lifting tackles, Safety belts, Conveyor Systems, Building Stability, Chemical stored FRP tanks etc., are carried out as per statutory requirements through competent person. An updated On site Emergency Plan (OEP) and Off-site Emergency Plan are available to mitigate emergencies. Periodic mock drills for hazardous chemical leakages and fire incident are conducted to ensure the effectiveness of emergency preparedness. Toxic gas leak sensors with alarms installed at toxic gases storage and handling areas like chlorine, sulphur di oxide etc. Smoke detectors with warning alarms are installed at paper storage godowns, Motor Control Centres (MCC), control rooms etc. The entire Mill is covered with fire hydrant points with pressurized water ring mains for fire fighting. Also different types of fire extinguishers according to the nature of fire are provided at strategic points for use in the event of fire. In addition, two mobile fire tenders and one portable fire pump are available to tackle fire emergency. Since inception, TNPL has maintained an excellent safety record.

20. PARTICULARS OF EMPLOYEES

None of the employees of the company was in receipt of remuneration in excess of the limits prescribed under the Companies Act, 2013 and the rules framed there under. The information as required under Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company, is annexed as Annexure IV.

21. CASH FLOW STATEMENT

As required under Regulation 34(2) (c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a Cash Flow Statement prepared in accordance with the Accounting Standard (AS-3) issued by the Institute of Chartered Accountants of India is attached to the Balance Sheet.

22. EXPORT HOUSE STATUS

The Company, in recognition of its export performance, got the "Three Star Export House" status awarded by the Government of India in accordance with the Foreign Trade Policy. The status is valid for a period of 5 years till 11th Oct., 2020.

23. INDUSTRIAL AND PERSONNEL RELATIONS

24. ENHANCING SHAREHOLDERSâ VALUE

Your Company believes in the importance of its Members who are among its most important stakeholders. Accordingly, your Company''s operations are committed to the goal of achieving high levels of performance and cost effectiveness, growth building , enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its stakeholders by ensuring that its corporate actions have positive impact on the socio-economic and environmental growth and development.

25. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

1. in the preparation of the annual accounts for the year ended 31st March, 2016, the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any;

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

4. the Annual Accounts were prepared for the financial year ended 31st March, 2016 on a going concern basis;

5. the directors have laid down proper internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively;

6. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "Annexure V"

27. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directors'' Report are enclosed as "Annexure VI and VII".

28. RELATED PARTY TRANSACTIONS

There are no materially significant transactions with related parties during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which are potentially conflicting with the interest of the Company at large.

The Board of Directors have framed the policy on Related Party Transactions and the same is uploaded on the Company''s website.

None of the Directors nor Key Managerial Personnel have any pecuniary relationships or transactions vis-a-vis the Company.

Accordingly, the disclosures of Related Party Transactions required under section 134 (3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

29. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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

30. MATERIAL CHANGES OCCURRED AFTER END OF FINANCIAL YEAR

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company''s financial position have occurred between the end of the financial year and date of this report.

31. CEO/CFO CERTIFICATION

As required by Regulation 17(8) of the SEBI Regulation, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31,2016 duly signed by the Chairman & Managing Director and Deputy Managing Director was submitted to the Board of Directors at their meeting held on May 27, 2016.

32. INVESTORSâ FACTORY VISIT

The Company arranged a factory visit for investors on 28.11.2015. 20 shareholders visited the factory under the above arrangement.

33. ACKNOWLEDGEMENT

The Board also places on record its sincere appreciation of the positive response received from the Company''s valued customers and thanks them for their continued support.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

34. CAUTIONARY STATEMENT

For and on behalf of the Board

Dr. RAJEEV RANJAN

CHAIRMAN AND MANAGING DIRECTOR

Date: 17^th August, 2016

Place: Chennai 600 032.

Mar 31, 2015

Dear MEMBERS

The Company's Directors are pleased to present the 35th Annual Report of the Company along with Audited Accounts for the financial year ended 31st March 2015.

1. FINANCIAL RESULTS

The Financial Results for the year under review are summarized below:

(Rs. in crore)

Particulars 2014-15 2013-14

Revenue from operations 2135.73 2285.22

Other income 16.64 16.72

Operating Profit (PBIDT) 522.36 523.21

Finance cost 154.93 128.21

Gross Profit (PBDT) 367.43 395.00

Depreciation 137.30 192.32

Profit before tax 230.13 202.68

Provision for tax 63.40 41.50

Profit after tax 166.73 161.18

Balance brought forward 27.12 20.22

Less: Adjustment* 7.14 -

Profit Available for appropriation 186.71 181.40

APPROPRIATIONS

Transfer to General Reserve 100.00 100.00

Debenture Redemption Reserve 5.42 5.70

Proposed Dividend 41.53 41.53

Taxon Dividend 8.45 7.05

Balance carried forward 31.31 27.12

186.71 181.40

*Adjustment of Depreciation as per note 7(b) of Schedule II to Companies Act, 2013 (Net of Deferred Tax Liability).

During the entire year 2014-15, Indian Paper Industry was under severe strain due to unprecedented poor marketing conditions and consequent drop in prices. Despite this your company has achieved good overall results. The Management deserves commendation for their performance.

2. DIVIDEND

Your Directors recommend a dividend of 60% for the year ended 31st March, 2015. The Dividend, if approved by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 18th September, 2015. Expenditure on the proposed dividend, will be Rs. 49.98 cr. inclusive of taxes.

3. TRANSFER TO RESERVES

The Company has transferred Rs. 100 cr. to General Reserves and Rs. 5.42 cr. to Debenture Redemption Reserve out of the amount available for appropriation. Rs. 31.31 cr. is proposed to be retained in the Profit & Loss Account.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR

a) Operations

1. Sales turnover crossed Rs.2000 cr mark for the second time.

2. Profit before tax of Rs.230.13 cr. was an all time record. Profit after tax of Rs.166.73 cr. exceeded the PAT achieved in 2013-14 by Rs. 5.60 cr.

3. 373259 MT of Paper and 284091 MT of Pulp were produced during the year.

4. Total sales was 337689 MT. Domestic sales constituted 78.44% and Export 21.56%.

5. 6208.84 lakh units of power were generated. 5841.57 lakh units were consumed. 367.27 lakh units were exported to the state grid. Power drawn from State Grid constitutes only 1.52% of total power consumed.

6. Received 127588 Renewable Energy Certificates (REC) for power generated from the steam produced in the Recovery Boiler. 48200 RECs were sold during the year yielding revenue of Rs. 7.12 crores (Net of exchange fees and service tax). 196381 RECs have been carried forward for sales during 2015-16.

7. Two bio-methanation plants set up within the factory premises have generated cumulatively 91.71 lakh m3 of methane gas during the year 2014 - 2015. By using the methane gas in lime kiln, TNPL has saved consumption of 5378 kl of high cost furnace oil during the year.

8. Two windfarms with an installed capacity of 35.5MW generated 469.20 lakh Kwh Units of'Green Power'.

9. The Company is involved in Farm Forestry and Plantations covering 105968 acres benefitting 20218 farmers in 29 districts of Tamilnadu.

10. Overall Water Consumption was 51 kl. Per MT of paper.

11.161910 tonnes of cement were produced during the year. TNPL is the first and only company in the Paper Industry to convert mill wastes into high grade cement.

12. The company repaid on schedule Term Loans amounting to Rs.359.89 cr.

b. New Projects

1. The company is setting up a state-of-the-art Multilayer Double Coated Board Plant with an annual capacity of 200,000 MT per annum as a green field project in Mondipatti village, Manaparai taluk, Trichy District. The project is progressing as per schedule. The project is targeted to be completed by December 2015.

2. The company is expanding the cement production capacity set up as part of Lime Sludge and Fly ash Management from 600 tpd to 900 tpd. The Project is expected to be completed by December 2015.

3. The company has acquired 38.40 acres land with an Industrial shed measuring 11,248 Sq.Mts at Mayanur in Karur District for setting up paper conversion centre and setting up units related to paper industry. The conversion centre will be made available for setting up conversion units. This project is also expected to be completed by December 2015.

c. Contribution to Environment

1. During January'15, M/s. TuV India Limited, a subsidiary of TuV NORD, Germany carried out Surveillance Audit of TNPL's Environmental Management System and recommended to maintain the certificate till February 2017 as TNPL is conforming to the requirements of ISO 14001:2004 standards.

2. TNPL has launched a new "Eco-friendly" product during the year under the brand name "GreenPal". This paper is produced from Bagasse and recycled fibres. No tree is cut for production of this product, thus making it a totally environmental friendly product.

3. TNPL's treated effluent water is used for irrigation of around 1700 acres of land under TNPL Treated Effluent Water Lift Irrigation Scheme (TEWLIS) and 306 acres of land under Captive Plantation scheme.

4. The bio-gas generated in Bio-methanation plant using bagasse wash effluent with high COD is being used in the lime kilns in lieu of furnace oil .

5. TNPL celebrated the "World Environment Day" on 5th June, 2014 in Kagithapuram unit. 5000 tree saplings were planted in and around cement plant unit for improving green cover. Environment awareness rally was conducted in Unit II at Mondipatti village, Manapparai Taluk involving school children.

d. Corporate Social Responsibility (CSR)

The company has constituted a Committee called

"Corporate Social Responsibility Committee" comprising of

5 Independent Directors. The Committee monitors CSR

activities. 1

1. The Company aims to spend 2% of the average net profit of the company before tax in the last three financial years . The company spent Rs.3.73 cr. on CSR activities during the year under review.

2. The Company has undertaken CSR activities as per the CSR policy (available on your company's website www.tnpl.com) The details are contained in the Annual Report on CSR activities vide Annexure -1, forming part of this Report. The CSR activities are mainly focused on Education, Health care, Socio-economic development, Environmental sustainability and Culture & Heritage promotion.

e. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R & D activities which are carried out largely in-house. A few activities are outsourced when warranted.

2. The R & D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

3. The company spent Rs. 6.12 Cr. on R & D activities during the year.

f. Awards

* The Company has received " IPMA Paper Mill of the year Award" for the year 2013-14 from Indian Paper Manufacturers' Association (IPMA).The company has received the above award Fourth time and for the Second time in a row.

* Dun & Bradstreet, Mumbai, has selected TNPL as the "Top Indian Company" under the sector paper for Dun & Bradstreet Corporate Awards 2015 for the Fourth time in a row.

* Confederation of Indian Industry (CII) in its 15th National Award for Excellence in Energy Management 2014, has selected TNPL as one of the 49 companies for the 'Excellent Energy Efficient Unit'Award.

5. MARKET TRENDS

a. General

The installed capacity of Paper industry in India is approximately 12.75 million tonnes. The Industry's average capacity utilization is 89%. The overall consumption inclusive of imports and net of exports is 13.10 million tonnes.

The average per capita consumption in India is around 11 kgs. against the global average consumption of 56 kgs. The world demand growth for paper is around 1.5%. With greater emphasis on education and literacy rate and positive trend in the growth of the economy, the demand growth for paper in India is estimated to be around 6%. Excise duty and Import duty on paper remained unchanged at 6% and 10% respectively.

b) Printing & Writing Paper

Between 2008 and 2011, many mills added capacity and supplies exceeded demand. Consequently, paper prices dropped in 2012. During 2013, Paper industry faced scarcity in supplies of pulpwood leading to mills importing wood logs and chips at higher prices impacting margins. Consequent to the steep increase in input costs, paper prices increased during 2013. The price rise did not last long. With the paper prices declining in the International market and Rupee strengthening against USD, large volume consumers and traders started importing paper in large volume under Free Trade Agreements (FTA). The domestic industry thus faced unprecedented challenges, both on cost front and on market front during 2014-15. Prices and sales declined eroding margins.

With seasonal demand from the Education Sector and positive sign in the economic growth, the market started showing signs of improvement since April 2015.

c) Packaging Boards

The market for Packaging Board is estimated at 2.4 Million tonnes. Grey-back Boards account for 1.08 million tonnes (45%), White-back Coated Boards and other high-end varieties like Folding Boxboard, Solid Bleached Sulphate Boards, etc. account for the remaining 1.32 million tonnes (55%) The demand growth in the high end segments is estimated at 11.5% per annum.

d) Outlook

With the demand growth anticipated at 6% per annum, the domestic consumption is expected to rise to 23.50 mtpa. by 2024-25 . There is good potential for domestic manufacturers for adding capacity in Paper and Board about 1 mtpa.

Consistent growth in the economy and greater emphasis on education and literacy by the Government are considered the key drivers for demand growth in printing & writing paper. Demand for better quality packaging of food & health care products and high value consumer products are the key demand drivers for growth in Paper Board.

e) TNPL response to Market Trends

TNPL has increased its production capacity consistently, keeping in pace with Industry growth. The Company is now setting up a Multilayer Double Coated Board Plant with a capacity of 2 lakh MT per annum. With this, the total production capacity of the company will rise to 6 lakh MT per annum from the Financial Year 2016-17.

6. DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors have extended the service of Thiru R Mani as Director (Operations) on contract basis for one year from 27th February, 2015. Thiru R Mani will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM.

In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Thiru T Udhayachandran IAS, Director and Thiru Mahesan Kasirajan IAS, Director retire by rotation at the forthcoming Annual General Meeting. They are eligible for reappointment as Directors. The Board of Directors, at its meeting held on 29th May, 2014 appointed Thiru V Sivakumar as the Company Secretary - a key managerial person in accordance with the provisions of Section 203 of the Companies Act, 2013.

6.1 Declaration from Independent Directors on Annual Basis

The Independent directors have submitted their disclosure to the Board confirming that they fulfill all the requirements as to qualify for their appointment as an Independent Director under the provisions of Section 149 of the Companies Act, 2013 as well as Clause 49 of the Listing Agreement. The Board confirms that the said independent directors meet the criteria as laid down under the Companies Act, 2013 as well as Clause 49 of the Listing Agreement.

6.2 Remuneration Policy

The Board, on the recommendation of the Nomination & Remuneration Committee has framed a policy for selection and appointment of Directors, Senior Management and their remuneration.

6.3 Meetings

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year, Eight Board Meetings and Seven Audit Committee Meetings were convened and held, the details are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and Clause 49 of the Listing Agreement.

6.4 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, 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 Audit and Nomination & Remuneration Committees.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process.

7. INTERNAL COMPLAINTS COMMITTEE

In accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 & the Rules made thereunder the Company has constituted an Internal Complaints Committee (ICC) as per section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 read with its Rules. The ICC will comprise the following Members:

(i) Tmt.R.S.Tamilarasy, Deputy Manager (Lab) - Presiding Officer

(ii) Thiru.P.Sundaram, MSW, Manager - HR (Member)

(iii) Tmt.M.Pemila Beham, MSW, Assistant Officer - HR (Member)

The above members are amongst employees preferably committed to cause of women or who have had experience in social work or have legal knowledge.

During the year under review, there were no complaints referred to the Committee.

8. AUDITORS

a) Statutory Auditors

The Comptroller and Auditor General of India appointed M/s. Raman Associate, Chartered Accountants, Chennai, as the Statutory Auditors of the Company for the Financial year 2014-15

b) Cost Auditors

Pursuant to Sec.148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules,2014, the cost audit records maintained by the company in respect of its cement activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s Raman & Associates, to audit the cost accounts of the company for the year 2014-15. The cost audit report for the year 2014-15 will be submitted to the Central Government before the due date. Cost Audit report for the financial year 2013-14 was filed on schedule.

c) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act,2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s R. Sridharan & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the company. The Report of the secretarial audit is annexed herewith as "Annexure II".

9. NON- CONVERTIBLE DEBENTURES

During the year, the Non-Convertible Debentures Series- II aggregating Rs. 50 Crore were fully redeemed.

In the year 2014-15, the company has paid their installments to the debenture holders for NCD Series-I and II aggregating to Rs. 34.72 cr. which was within the stipulated time as per schedule.

As on 31st March, 2015, Non-Convertible Debentures Series-I aggregating Rs. 5.56 cr. remain outstanding.

10. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1st June, 2002 and renewals from 1st August, 2005. There was no outstanding deposit as on 31st March, 2015 compared to Rs.0.45 Lakhs in the previous year. The Company has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptances of Deposits) Rules, 2014.

11. RISK MANAGEMENT FRAMEWORK

TNPL has established a Risk Management Framework under which the risks covering the entire operation have been identified and categorized as high, medium and low.

All the risks are discussed periodically in the Senior Management Committee meetings and appropriate actions are taken pro-actively.

The risk details and mitigation plans are placed before the Audit Committee and the Board, bi-annually.

12. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

TNPL has instituted adequate internal control procedures commensurate with the size of its operations. TNPL has also prepared an 'Internal Control Procedure Manual' to ensure that the control procedures are followed by all departments. The departments concerned in the company are complying with the stipulations in the manual without deviating the procedures. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company.

Internal controls are supported by internal audit and management reviews. The Audit Committee meets periodically the Management, External-Internal auditors, Internal auditors, Statutory Auditors and reviews the Annual Audit plans and internal controls. All significant observations of the Auditors are acted upon. The Audit Committee met 7 times during the financial year. The review of Management Response to Audit Observations, constitutes an important aspect of the Agenda for each meeting.

13. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The company has framed a vigil mechanism / whistle blower policy, the details of such Policy are explained in the Corporate Governance Report and also posted on the website of the Company at www.tnpl.com.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

15. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs. 11,03,649/- being the Dividend and Fixed Deposit amount which were due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A (5) of the Companies Act, 1956.

16. UNPAID DIVIDEND STATUS

Dividends were remaining unpaid due to non-confirmation of their new addresses by the concerned shareholders. The unpaid dividends were returned by the postal authorities. Effective follow-up by the Company has resulted in Unpaid Dividends being consistently below 0.5% of the total dividends. As and when the shareholders communicate the new address, the dividend is sent to the shareholders. At the end of seven years, the unpaid dividend is transferred to Investor Education & Protection Fund. The table and graph given below summarize the status of Unpaid Dividends.

DIVIDEND STATUS FOR THE LAST 7 YEARS

(Rs. In lakhs)

SL YEAR SHARE DIVIDEND DIVIDEND DIVIDEND No. CAPITAL AMOUNT PAID %

1. 2007-08 6921.06 25 1730.27 1724.77

2. 2008-09 6921.06 45 3114.48 3106.60

3 2009-10 6921.06 45 3114.48 3103.07

4. 2010-11 6921.06 50 3460.53 3448.99

5. 2011-12 6921.06 50 3460.53 3448.09

6. 2012-13 6921.06 50 3460.53 3446.28

7. 2013-14 6921.06 60 4152.63 4134.30

SL YEAR DIVIDEND % OF PAID % OF UNPAID No. UNPAID AS ON DIVIDEND DIVIDEND 31.3.2015

1. 2007-08 5.50 99.68 0.32

2. 2008-09 788 99.75 0.25

3 2009-10 11.41 99.63 0.37

4. 2010-11 11.54 99.67 0.33

5. 2011-12 12.44 99.64 0.36

6. 2012-13 14.25 99.59 0.41

7. 2013-14 18.33 99.56 0.44

17. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 134(3)(m) of the Companies Act 2013, read with the Rule 8 of The Companies (Accounts) Rules, 2014, is furnished in Annexure III to this Report.

18. HEALTH

To render Medical Assistance for the employees and their dependents, company run Occupational Health Centre (OHC). OHC is functioning on round the clock basis in housing colony. In addition, specialist doctors from various fields visit the OHC every Sunday.

The company bears the entire medical expenses for 7 Serious Ailments viz. Heart Ailment, Cancer, Kidney Transplantation, Paralysis, Leprosy, Tuberculosis and Brain Surgery. Under a Special Medical Assistance Scheme, 50% of the hospitalization expenses for employee and their dependants are borne by the company.

Comprehensive Master Health Check-up is being carried out for employees thrice in their service period.

19. SAFETY

TNPL has adopted a clearly defined Occupational Health and Safety Policy. Suitable Personal Protective Equipments are provided to all employees. Periodical Training Programs are conducted to improve safety awareness among the employees including contract workmen. Caution boards, posters, slogans, Do's and Dont's etc. are displayed at prominent places to promote safety at work places. Periodical medical checkups are organized for the employees to identify occupational health hazards. Safety Committee has been constituted and meetings are conducted periodically and suggestions given to improve safety aspects are implemented. Accidents and incidents are investigated and preventive / corrective actions are taken to avoid recurrence. Safety Audit, HAZOP study and Risk Analysis are carried out periodically through safety experts and the recommendations are implemented.

Testing of Pressure Vessels, Lifting tackles, Conveyor Systems, Building Stability, etc., are carried out as per statutory requirements through competent person. On-site/Off-site Emergency Plans are available to mitigate emergencies. Periodic mock drills for hazardous chemical leakages and fire incident are conducted to ensure the effectiveness of emergency preparedness. Toxic gas leak sensors and smoke detectors with alarms are installed at hazardous material storage and process areas. The entire Mill is covered with fire hydrant points with pressurized water ring mains for fire fighting. Also different types of fire extinguishers according to the nature of fire are provided at strategic points for use in the event of fire. In addition, two mobile fire tenders and one portable fire pump are available to tackle fire emergency. Since inception, TNPL has maintained an excellent safety record.

20. PARTICULARS OF EMPLOYEES

None of the employees of the company was in receipt of remuneration in excess of the limits prescribed under the Companies Act, 2013 and the rules framed thereunder. The information as required under Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company, is annexed as Annexure V.

21. CASH FLOW STATEMENT

As required under Clause 32 of the Listing Agreement with the Stock Exchanges, a Cash Flow Statement prepared in accordance with the Accounting Standard (AS-3) issued by the Institute of Chartered Accountants of India is attached to the Balance Sheet.

22. EXPORT HOUSE STATUS

The Company continues to enjoy "Trading House" status, awarded by the Government of India, in recognition of its export performance.

23. INDUSTRIAL AND PERSONNEL RELATIONS

The Company continues to have healthy industrial and employee relations at all levels. Despite severe competition, the enthusiasm and unstinting efforts of the employees have enabled the company to remain at the forefront of the Industry.

Your Company continued to receive co-operation and unstinted support from the distributors, retailers, stockists, suppliers and others associated with the Company as its trading partners. The Directors wish to place on record their appreciation for the same and your Company will continue in its endeavor to build and nurture strong links with trade, based on mutuality, respect and co-operation with each other and consistent with consumer interest.

24. ENHANCING SHAREHOLDERS'VALUE

Your Company believes in the importance of its Members who are among its most important stakeholders. Accordingly, your Company's operations are committed to the goal of achieving high levels of performance and cost effectiveness, growth building , enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its stakeholders by ensuring that its corporate actions have positive impact on the socio-economic and environmental growth and development.

25. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, it is hereby confirmed:

1. That in the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the directors had selected 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 of the company for that period;

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

4. That the Annual Accounts were prepared for the financial year ended 31st March, 2015 on a going concern basis;

5. That the directors have laid down proper internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively;

6. That the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and are operating effectively.

26. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "Annexure IV"

27. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directors' Report are enclosed as "Annexures VI and VII".

As required by the Listing Agreement, an Auditor's Certificate on Corporate Governance and a Declaration by the Chairman & Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

28. RELATED PARTY TRANSACTIONS

There are no materially significant transactions with related parties during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which are potentially conflicting with the interest of the Company at large.

The Board of Directors have framed the policy on Related Party Transactions and the same is uploaded on the Company's website.

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

Accordingly, the disclosures of Related Party Transactions required under section 134 (3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

29. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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

30. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31, 2015 duly signed by the Chairman & Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 28, 2015.

31. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation for the assistance, co-operation and support extended to the company by the Govt. of Tamil Nadu, Commercial Banks, Financial Institutions, Sugar Mills and Dealers.

The Board also places on record its sincere appreciation of the positive response received from the Company's valued customers and thanks them for their continued support .

The company is grateful to all employees for their exemplary co-operation during the year. Their contribution has been truly outstanding. The Directors place on record their appreciation of the excellent effort made by every employee to enhance the company's performance in adverse market conditions.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

32. CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. The Company cannot guarantee the accuracy of assumptions and the projected future performance of the Company. The actual results may materially differ from those expressed or implied in this report. Important factors that could influence the Company's operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

For and on behalf of the Board

C VSANKAR CHAIRMAN AND MANAGING DIRECTOR Date: 3rd August, 2015 Place: Chennai 600 032

Mar 31, 2014

TO THE MEMBERS

The Company''s Directors are pleased to present the 34th Annual Report of the Company along with Audited Accounts for the financial year ended 31st March 2014.

1. FINANCIAL RESULTS

The Financial Results for the year under review are summarized below:

(Rs. in crore) Particulars 2013-14 2012-13

Revenue from operations 2285.22 1861.26

Other income 16.72 19.92

Operating Profit (PBIDT) 523.21 422.06

Finance cost 128.21 120.97

Gross Profit (PBDT) 395.00 301.09

Depreciation 192.32 174.98

Profit before tax 202.68 126.11

Provision for tax 41.50 34.63

Profit after tax 161.18 91.48

Balance brought forward 20.22 20.93

Profit Available for appropriation 181.40 112.41

APPROPRIATIONS

Transfer to General Reserve 100.00 46.00

Debenture Redemption Reserve 5.70 5.70

Proposed Dividend 41.53 34.61

Tax on Dividend 7.05 5.88

Balance carried forward 27.12 20.22

181.40 112.41

The overall Results are satisfactory as the Company had to contend with severe raw material shortages, steep escalation in costs and a progressive reduction in Market Demand during the year. The Management deserves commendation for their performance despite the adverse external environment.

2. DIVIDEND

Your Directors recommend a dividend of 60 % for the year ended 31.3.2014. The Dividend, if approved by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 15.9.14. Expenditure on the proposed dividend, will be Rs.48.58 crores, inclusive of taxes.

3. TRANSFER TO RESERVES

The Company has transferred Rs. 100 cr. to General Reserves and Rs. 5.70 crores to Debenture Redemption Reserve out of the amount available for appropriation. Rs.27.12 cr. is proposed to be retained in the Profit & Loss Account.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR a) Operations

1. Sales turnover crossed Rs.2000 cr. mark for the first time. At Rs. 2285 cr, sales were 22% higher than in the previous year.

2. Profit before tax of Rs.202.68 cr. was an all time record. Profit after tax of Rs.161.18 cr. exceeded the PAT achieved in 2012-13 by 76%.

3. Sales volume of 391843 MT was the highest achieved by the Company in its history. This was made possible by the record production of 387714 MT by the Kagithapuram Factory.

The company once again achieved ZERO stock of Printing and Writing paper at the end of the year.

4. The Directors have recommended a Dividend of 60% compared to 50% in each of the last three years. This rate of Dividend is the highest since the company began operations in 1986.

The Dividend reflects the confidence that the Directors and Management have in the future of the company.

5. The Company generated 5650.80 lakh units of power and consumed 5532.06 lakh units. The excess of 118.74 lakh units were exported to the State Grid.

TNPL self-generates 99.2% of its power requirements and draws only 0.8% from the State Grid. This is an unparalelled performance compared to other mills in the paper industry in India and all industries in Tamil Nadu.

6. The company received 128043 Renewable Energy Certificates (REC) for generating power using steam produced in the Recovery Boiler. Of these 66854 RECs were sold during the year yielding revenues of Rs.10 cr.

7. The Bio-methanation plants generated 96.64 lakh cubic metres of methane gas, the consumption of which in the lime kilns saved use of furnace oil valued at Rs. 24.54 cr.

8. 113904 tonnes of cement were produced using waste material - lime sludge and fly ash generated in the Paper Mill. TNPL is the first and only company in the Paper Industry in India to convert mill wastes into useable high grade cement .

9. 257524 tonnes of Hardwood and Chemical Bagasse Pulp were produced during the year.

The Company is involved in Farm Forestry and Plantations covering over 100185 acres benefitting 18709 farmers in 29 districts of Tamil Nadu.

10. The company repaid on schedule Term Loans amounting to Rs.375 cr.

b. New Projects

1. The Company has begun work on setting up a state- of-the-art Multilayer Double Coated Board Plant with an annual capacity of 200,000 tonnes at a greenfield site in Manaparai Taluk, Trichy District (Tamil Nadu State). The capital outlay for this project is estimated at Rs.1500 cr. and is scheduled to be completed by December 2015.

2. A De-inking pulp plant with a capacity of 300 tonnes per day was commissioned during the year to augment inhouse pulp production.

3. A 125 tonnes per hour capacity high pressure boiler and a 41MW capacity Turbo Generator (TG) were commissioned during the year. As a consequence, the company is now almost self-sufficient in power.

4. A 100 tonnes per day Wet Ground Calcium Carbonate

(WGCC) plant has been completed on a Build, Own Operate basis (BOO) through M/s OMYA, Switzerland. The total requirement of WGCC for manufacture of paper will be met from this source at a substantially lower cost.

5. A 200 tonnes per day Precipitated Calcium Carbonate

(PCC) Plant is being set up through M/s OMYA, Switzerland on a Build, Own Operate basis(BOO). The plant will become operational in July 2014 and when completed, will lower costs for the Company .

c. Contribution to Environment

1. The company has adopted Eco friendly ECF bleaching in Pulp manufacture. The switch over from conventional chlorine bleaching to ECF bleaching involved a capital outlay of Rs.316 cr.

2. The Company has introduced ''OZONE TREATMENT '' as a tertiary step in the effluent treatment plant, substantially improving the quality of discharged water TNPL is the first and only company in the paper industry to have introduced Ozone treatment technology, to improve the quality of its effluent water.

3. The company has implemented several water conservation measures. The overall water consumption per mt of paper during the year was 42 Kl., one of the lowest in the industry.

4. Waste products (i.e lime sludge and fly ash) generated in paper manufacture is being converted into high grade cement.

5. The company has installed a continuous air quality monitoring system at the factory.

6. The windfarms at Devarkulam and Perungudi with an installed capacity of 35.5MW generated 522.07 lakh Kwh Units of ''Green Power''.

d. Corporate Social Responsibility (CSR)

1. The Company is committed to being a socially responsible corporate citizen. The CSR activities focus primarily on two areas - EDUCATION & HEALTH CARE

2. The CSR projects promote and enrich Economic, Social, Environmental and Cultural growth of the community living in areas near the factory.

3. The Company aims to spend approximately 3% of the profit of the previous year on CSR activities, in the following year. The Company spent Rs. 3.27 cr. on CSR activities during the year under review.

e. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R & D activities which are carried out largely in-house. A few activities are outsourced when warranted.

2. The R & D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

3. The company spent Rs. 4.04 cr. on R & D activities during the year.

f. Awards

The Company has received "Environmental Best Practices Award 2013" from the Confederation of Indian Industry(CII).

The company has received the National Award for Excellence in Cost Management 2013 [First Award under the category of Private - Manufacturing: Organisation (Large)] from the Institute of Cost Accountants of India.

Dun & Bradstreet, Mumbai, has selected TNPL as the Top Company in the Indian Paper Industry as one of the Dun & Bradstreet Corporate Awards for 2014.

5. MARKET TRENDS

a. General

The global paper production is estimated at 430 Million tonnes and in India 12 Million tonnes. India accounts for only 2.79% of World production. Demand growth in developed countries is expected to be flat. Growth in developing countries is likely to account for the worldwide growth of 1.5% - 2% per annum.

With the population growth of 1.9% and the increase in the literacy rate, India is expected to be the fastest growing market in the world with an overall growth rate of 6% per annum. Paper consumption in India is expected to reach around 14 Million tonnes by 2015-16.

Excise Duty and Import Duty remained unchanged at 6% and 10% respectively during the year.

b) Printing & Writing Paper (PWP)

Between 2008 and 2011, paper production capacity increased by approximately 60% over the capacity in 2007 against the then demand growth of about 8% per annum. Supplies were in excess of demand during 2011 and 2012. Paper prices therefore declined steeply during these years . Raw materials shortage and steep increase in input costs from the third quarter of financial year 2012-13 increased the cost of production substantially. Consequent to this, paper prices increased from December 2012. Printing and Writing paper now accounts for 35% of total demand , with a growth rate of 6% per annum . No major capacity addition has been announced by mills after the expansion between 2008 and 2011.

c) Packaging Boards

The market for Packaging Board is estimated at 2.2 Million tonnes. Grey-back Boards account for 1.05 million tonnes, White-back Coated Boards and other high-end varieties like Folding Boxboard, Solid Bleached Sulphate Boards, account for the remaining 1.15 million tonnes. The demand growth in the high end segments is estimated at 11.6% per annum.

d) Outlook

Despite slow economic recovery and continued erosion in demand by electronic media, global paper consumption is expected to reach 445 million tons by 2015, with a growth rate of 1.5 - 2% per annum. With consistent demand from the education sector, changes in lifestyle and overall economic growth there is potential for capacity addition and fresh investments in the Industry in the coming years.

As the demand for pulpwood exceeded supplies pulp wood prices have increased by about 60% during the year. Hit by the steep increase in pulpwood cost, the industry has stepped up plantation activities to augment pulp wood supplies. The shortage of pulpwood is expected to recede in a couple of years.

e) TNPL response to Market Trends

TNPL has increased the production capacity consistently keeping in pace with Industry growth. The company is now setting up a multilayer double coated Board Plant with a capacity of 2 lakh tonnes per annum. With this, the total production capacity of the company will rise to 6 lakh MT per annum from financial year 2016-17.

During the year domestic sales constituted 83 % and Export 17%.

6 DIRECTORS

Pursuant to the orders issued by the Government of Tamil Nadu Thiru C V Sankar IAS is holding full additional charge of the post of Chairman and Managing Director, TNPL vice Thiru N S Palaniappan IAS w.e.f. 25.10.2013. Thiru C V Sankar, IAS will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director.

Thiru Mahesan Kasirajan, IAS, has been transferred from the post of Director of Sugar. Consequently he relinquished his position as Director in TNPL.

The Board of Directors have extended the services of Thiru A Velliangiri, Deputy Managing Director on contract basis for a period of two years w.e.f. 19.12.2013 . Thiru A Velliangiri will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM.

The Board of Directors have extended the service of Thiru R Mani as Director(Operations) on contract basis for a further period of one year from 27.2.2014. Thiru R Mani will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM.

Thiru T Udhayachandran IAS, Director retires by rotation at the forthcoming Annual General Meeting. He is eligible for reappointment as Director.

In accordance with Sec.149 and other applicable provisions of the Companies Act, 2013, SEBI guidelines , the company has to appoint at least one half of the Board as Independent directors with specific mention of tenure. Accordingly, the following non-executive and independent directors are proposed to be appointed as Independent directors for a tenure of three years i.e. upto 31.3.2017 :

1.Thiru V Narayanan

2.Thiru N Kumaravelu

3.Thiru M R Kumar

4.Thiru V Nagappan

5.Tmt.Sarada Jagan

Independent directors are not liable for retirement by rotation.

7. AUDITORS

a) Statutory Auditors

The Comptroller and Auditor General of India appointed M/s. Raman Associate., Chartered Accountants,

Chennai as the Statutory Auditors of the Company for the Financial year 2013-14.

b) Cost Auditors

Pursuant to Sec.233B of the Companies Act, 1956, the Central Government has ordered that the company carries out audit of cost accounts for every year relating to Paper, Cement and Energy. M/s S Mahadevan & Co, were appointed as Cost Auditors for the year 2013-14. The cost audit report for the year 2013-14 will be submitted to the Central Government before the due date. Cost Audit report for the financial year 2012-13 was filed on schedule.

c) Secretarial Auditor

M/s R. Sridharan & Associates have carried out Secretarial Audit of the company for the year ended March 2014 .The company has complied with all applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreement with the Stock Exchanges and all the regulations of SEBI as applicable to the company.

8. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1.6.2002 and renewals from 1.8.2005.The outstanding deposits as on 31.3.2014 was Rs.0.45 Lakhs against Rs.1.64 Lakhs in the previous year. The number of depositors on 31.3.2014 was 2 against 10 in the previous year. The outstanding deposits remain unpaid as the depositors have not made known their new addresses to the Company.

9. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs.8,44,419/- being the Dividend and Fixed Deposit amount which were due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A(5) of the Companies Act , 1956.

10. UNPAID DIVIDEND STATUS

Dividends were remaining unpaid due to non-confirmation of their new addresses by the concerned shareholders. The unpaid dividends were returned by the postal authorities. Effective follow-up by the Company has resulted in Unpaid Dividends being consistently below 0.5% of the total dividends. As and when the shareholders communicate the new address, the dividend is sent to the shareholders. At the end of seven years the unpaid dividend is transferred to Investor Education & Protection Fund. The table and graph given below summarize the status of Unpaid Dividends

DIVIDEND STATUS FOR THE LAST 7 YEARS

(Rs. In lakhs) SL YEAR SHARE DIVIDEND DIVIDEND DIVIDEND No. CAPITAL AMOUNT PAID % 1. 2006-07 6921.06 25 1730.27 1724.25 (Final Dividend)

2 2007-08 6921.06 20 1384.21 1379.71 (Interim Dividend) 2007-08 6921.06 25 1730.27 1724.7 (Final Dividend)

3. 2008-09 6921.06 45 3114.48 3106.50

4. 2009-10 6921.06 45 3114.48 3102.73

5. 2010-11 6921.06 50 3460.53 3448.57

6. 2011-12 6921.06 50 3460.53 3447.61

7. 2012-13 6921.06 50 3460.53 3445.74

YEAR DIVIDEND % OF PAID % OF UNPAID UNPAID AS ON DIVIDEND DIVIDEND 31.3.2014

2006-07 6.02 99.65 0.35 (Final Dividend)

2007-08 4.50 99.67 0.33 (Interim Dividend) 2007-08 (Final Dividend) 5.57 99.67 0.33

2008-09 7.98 99.74 0.26

2009-10 11.75 99.62 0.38 2010-11 11.96 99.65 0.35

2011-12 12.92 99.62 0.38

2012-13 14.78 99.57 0.43

11. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 217(1)(e) of the Companies Act. 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are furnished in Annexures I and II to this Report.

12. STATEMENT OF EMPLOYEES REMUNERATION (217(2A)Companies Act 1956)

None of the employees drew remuneration of more than Rs.60,00,000/- per annum during the year. This information is furnished as required under section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975.

13. CASH FLOW STATEMENT

As required under Clause 32 of the Listing Agreement with the Stock Exchanges, a Cash Flow Statement prepared in accordance with the Accounting Standard (AS-3) issued by the Institute of Chartered Accountants of India is attached to the Balance Sheet.

14. EXPORT HOUSE STATUS

The Company continues to enjoy "Two Star Export House" status, awarded by the Government of India, in recognition of its export performance.

15. INDUSTRIAL RELATIONS

Industrial relations during the year continued to be cordial.

16. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3 )( c) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed:

1. That the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the selected accounting policies were applied consistently and judgments and estimates that are reasonable and prudent were made 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 of the company for that period;

3. That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act , 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Annual Accounts were prepared for the financial year ended 31st March 2014 on a going concern basis.

17. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of

Directors'' Report are enclosed as Annexures III and IV.

As required by the Listing Agreement, an Auditor''s Certificate on Corporate Governance and a Declaration by the Chairman & Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

18. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31, 2014 duly signed by the Chairman & Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 29, 2014.

19. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation for the assistance, co-operation and support extended to the company by the Govt. of Tamil Nadu, Commercial Banks, Financial Institutions, Sugar Mills and Dealers.

The Board also places on record its sincere appreciation of the positive response received from the Company''s valued customers and thanks them for their continued support .

The company is grateful to all employees for their exemplary co-operation during the year. Their contribution has been truly outstanding. The Directors place on record their appreciation of the excellent effort made by every employee to enhance the company''s performance in adverse market conditions.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

For and on behalf of the Board

C V SANKAR CHAIRMAN AND MANAGING DIRECTOR

Date: 29th May 2014 Place:Chennai 600 032

Mar 31, 2013

TO THE MEMBERS

The Directors have pleasure in presenting the Thirtythird Annual Report and the Audited Accounts of the Company for the financial year ended 31.3.2013.

1. FINANCIAL RESULTS

The Financial Performance of the company for the year under review is summarized below :

(Rs. in crore)

Particulars 2012-13 2011-12

Revenue from operations 1861.26 1522.92

Other income 19.92 16.07

Operating Profit (PBIDT) 422.06 335.54

Finance cost 120.97 141.26

Gross Profit (PBDT) 301.09 194.28

Depreciation 174.98 169.05

Profit before exceptional item and tax 126.11 25.23

Exceptional item - 99.88

Profit after exceptional item and before tax 126.11 125.11

Provision for tax 34.63 16.17

Profit after tax 91.48 108.94

Balance brought forward 20.93 20.91

Profit Available for appropriation 112.41 129.85

APPROPRIATIONS

Transfer to General Reserve 46.00 63.00

Debenture Redemption Reserve 5.70 5.70

Proposed Dividend 34.61 34.61

Tax on Dividend 5.88 5.61

Balance carried forward 20.22 20.93

112.41 129.85

Despite the sluggish demand for Printing 8i Writing Paper during the period April-November 2012 and a significant increase in input costs in all four quarters of the year, the company has earned a PBT of Rs.126.11 crores. The corresponding figure in the previous year - excluding exceptional items - was Rs.25.23 crores. This performance, in an adverse environment, is a commendable achievement by the Management.

Tax expenses provided for the year is Rs.34.63 cr. This includes an additional Rs. 13.21 cr. provided for deferred tax due to increase in surcharge on Income-tax from 5% to 10% in the Finance Act, 2013.

2. DIVIDEND

Your Directors recommend a dividend of 50% (Rs. 5.00 per share) for the year ended 31.3.2013. The Dividend, after approval by the shareholders at the AGM, will be paid to the equity shareholders whose names appear in the Register of Members as on 19.9.13. Expenditure on the proposed dividend of 50%, will be Rs.40.49 crores, inclusive of taxes.

3. TRANSFER TO RESERVES

The Company has transferred Rs. 46.00 crores to General Reserves and Rs.5.70 crores to Debenture Redemption Reserve out of the amount available for appropriation. Rs.20.22 crores is proposed to be retained in the Profit & Loss Account.

4. PERFORMANCE HIGHLIGHTS OF THE YEAR a) Operations

1. Sales turnover crossed Rs.1800 crores for the first time

2. Paper production increased to 371637 tonnes, 28331 MT higher than the previous year

3. Hardwood and Chemical bagasse pulp production increased to 275226 tonnes, an increase of 1543 tonnes over 2011-12.

4. The Wind Farm generated 586.59 lakh units of''Green Power'' and earned a profit of Rs.5.82 cr.

5. The Company is involved in pulpwood plantation in 91,711 acres benefiting 17021 farmers in 28 Districts of Tamil Nadu.

6. The Bio-methanation plants generated 101.33 lakh cubic metres of methane gas. The bio-gas generation is higher by 13.98 lakh cubic meters compared to the previous year. The methane gas was consumed in the lime kilns saving 5966 KL of furnace oil valued at Rs.23.89 crores.

7. 136738 Renewable Energy Certificates (REC) were received by the company for generating power using exclusively steam produced in the recovery boiler. TNPL is the FIRST in the paper industry to have received this benefit. 94678 RECs were sold upto 31.3.2013, and the balance has been carried forward to 2013-14.

8. Substantial progress was achieved in the implementation of the 300 tpd De-inking Plant and the Revamping of Power 8i Steam System.

9. The company received the following Awards and Accolades during the Year:

(a)'' The Green Energy and Bio fuel Award 2012'' from PPI (Pulp and Paper International) Magazine. Many global players competed for this award and TNPL came out on top receiving worldwide acclamation for the performance.

(b) "IPMA Paper Mill of the Year Award" for the year 2012 from Indian Paper Manufacturers Association, New Delhi. TNPL has received this award for the third time.

(c) The Green Award 2012 from the Dept. of Environment and Forests, Government of Tamil Nadu.

(d) Award of "Excellent Energy Efficient Unit" for the year 2012 from Confederation of Indian Industry (CII).

10. Forest Stewardship Council (FSC), an independent, non- government, non-profit organization, has awarded the prestigious Forest Management and Chain of Custody Certificate (RA-FSC-FM/CoC-006000) to TNPL. This certificate is valid for five years upto 5th July 2017. The Certificate covers 19561 Hectares of land. This is the largest area certified by FSC in India accounting for approximately 50% of the total area certified by them. TNPL can henceforward use the FSC label on its products made from FSC certified wood.

11. Your Company has initiated action to set up a state-of- the-art Multilayer Double Coated Board Plant of a capacity of two lakh tonnes per annum at a capital outlay of Rs.1200 crore in Mondipatti village,Manaparai Taluk in Trichy District. This greenfield project will be funded through internal accruals and term loans. The project will be set up in three years latest by March 2016.

12. The Directors have proposed a Dividend of 50% (Rs. 5.00 per share) The proposed dividend reflects the confidence that the Directors and Management have in the company''s future.

b. Contribution to Environment

1. The company has adopted Eco friendly ECF bleaching in Pulp manufacture. The switch over from conventional chlorine bleaching to ECF bleaching involved a capital outlay of Rs.316 Crores.

2. The Company has introduced ''OZONE TREATMENT'' as a tertiary step in the effluent treatment plant, substantially improving the quality of discharged water. TNPL is the first and only company in the paper industry to have introduced Ozone treatment of its effluent waste water.

3. As part of its conservation effort, TNPL consumes the lowest amount of water per ton of paper produced in the country.

4. By setting up the 600 tpd cement plant, TNPL converts waste products(lime sludge and fly ash) generated in paper manufacture into high grade cement.

5. A continuous air quality monitoring system has been installed at the factory.

6. The windfarms at Devarkularm and Perungudi with an installed capacity of 35.5 MW generated 586.59 lakh Kwh Units of''Green Power'' during 2012-2013.

c. Corporate Social Responsibility (CSR)

1. The company is committed to being a socially responsible corporate citizen and has spent Rs.3.71 crores on its Corporate Social Responsibility Programmes in 2011-2012 and Rs.5.36 Crores in 2012-2013

2. The CSR projects promote Economic, Social, Environmental and Cultural growth of the community living in areas near the factory. The CSR activities are equitable and focus primarily on providing Education and Health care.

3. The company aims to spend approximately 3% of the profit of the previous year on CSR activities, in the following year.

d. Contribution to Innovation and New knowledge development

1. The company nurtures creativity and innovation through its R & D activities which are carried out largely in-house. A few activities are outsourced when warranted.

2. The expenditure on R&D activities is Rs.4.90 cr. The long term objective is to increase R&D investment from the current level of 0.27% to 1% of sales turnover.

3. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

e. Others

1. During the year the company has generated and consumed 5233.31 lakh units of power through TG. Power drawn from State Grid constitutes only 1.63% of the power consumed.

2. The Company has tied up term loans with banks for financing the De - inking Pulp Plant Project.

Of the funds availed, the company has temporarily utilised Rs 30.91 Crores for its business operations. The funds would be applied ultimately for the designated purpose.

5. MARKET TRENDS a. General

Global Production of paper is estimated at 430 Million tons and in India 12 million tons. India accounts for 2.79% of world production. Per capita consumption of paper is approximately 10 kgs. in this country against the global average of 60 kg.

The Excise duty and Import duty have remained unchanged at 6% and 10% respectively.

b) Printing & Writing Paper (PWP)

Between 2008 and 2010, paper capacity in the country increased by about 1.50 million tonnes, higher approximately by 60% over the capacity in 2007. Demand growth however continued only at 8-9% per annum. As a consequence, supplies were in excess of demand for about 2 years. Paper prices therefore declined steeply during 2010-11 and 2011-12 even though input costs increased. The market has improved since December 2012 and is now stable.

c) Packaging Boards

The total market for packaging board is estimated at 2.40 million tonnes. About 50% of the market relates to grey back boards and the remaining 50% relates to white coated back high end varieties. The demand growth in the higher segments is of the order of 12- 13% per annum.

d) Outlook

Growth in the education sector, a buoyant economy, changes in lifestyle and low per capita consumption of paper in India are the major growth drivers of the Industry.

With the increase in paper production capacity, the demand for pulpwood has increased. However, pulpwood supplies are less than the demand. Pulpwood prices have increased by about 40% in the last one year.

Volatility in the exchange rates has increased the cost of imported raw materials and fuel.

e) TNPL response to Market Trends

In the first eight months of 2012-13, TNPL domestic sales were moderate because of sluggish market. A revival in demand enabled the company to increase sales significantly in the last four months of the year.

Export sales constituted 17.34% of total sales.

6 DIRECTORS

Pursuant to the orders of Government of Tamil Nadu:

(a) Thiru Md.Nasimuddin IAS was placed in full additional charge of the post of Managing Director, TNPL vice Thiru Santosh K Misra IAS, MD, TNPL w.e.f. 31.5.2012.

(b) Thiru Vikram Kapur IAS was nominated as Chairman of TNPL in the place of Dr.N Sundaradevan IAS, who retired on 30.9.2012.

(c) Thiru N S Palaniappan, IAS was co-opted as an Additional Director w.e.f.13.12.2012 in place of Thiru Vikram Kapur IAS. Thiru N S Palaniappan, IAS will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director.

Further, vide Government Order dt 11.12.2012, Thiru N S Palaniappan, IAS has been nominated in the place of Thiru Md.Nasimuddin, IAS as Chairman and Managing Director of the Company.

(d) Thiru Mahesan Kasirajan, IAS was co-opted as an Additional Director w.e.f.6.11.2012 vice Thiru N Mathivanan IAS. Thiru Mahesan Kasirajan, IAS will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director.

The Board in its meeting held on 7th December 2012 extended the services of Thiru A Velliangiri, Dy. Managing Director on a contractual arrangement for a further period of one year w.e.f. 19.12.2012 on the existing terms and conditions. Thiru A Velliangiri will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM. The contract extending his services is renewable for a period of one more year.

The Board in its Meeting held on 8.2.2013 appointed Thiru R Mani as Director(Operations) on contractual arrangement for a period of one year from 8.2.2013. Thiru R Mani will hold office upto the date of the forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM. The contract extending his services is renewable for a period of one more year.

Thiru V Nagappan was co-opted as an Additional Director w.e.f.9.4.2013. Thiru V Nagappan will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director at the AGM.

Thiru N Kumaravelu and Thiru M R Kumar, Directors retire by rotation at the forthcoming Annual General Meeting. They are eligible for reappointment as Directors.

7. AUDITORS

a) Statutory Auditors The Comptroller and Auditor

General of India appointed M/s. P.B Vijayaraghavan & Co., Chennai as the Statutory Auditors of the Company for the Financial year 2012-13

b) Cost Auditors Pursuant to Sec.233 B of the

Companies Act, 1956, the Central Government has ordered that the company carries out audit of cost accounts for every year relating to Paper, Cement and Energy, M/s S Mahadevan & Co, were appointed as Cost Auditors for the year 2012-13. The cost audit report for the year 2012-13 will be submitted to the Central Government before the due date.

Cost Audit report for the financial year 2011-12 was filed well before the due date.

c) Secretarial Auditor M/s R. Sridharan & Associates have carried out Secretarial

Audit of the company for the year ended March 2013. The company has complied with all applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreement with the Stock Exchanges and all the regulations of SEBI as applicable to the company

8. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1.6.2002 and renewals from 1.8.2005. The outstanding deposits as on 31.3.2013 was Rs.1.64 Lakhs against Rs.2.45 Lakhs in the previous year. The number of depositors on 31.3.2013 was 10 against 14 in the previous year. The outstanding deposits remain unpaid as the depositors have not made known their new addresses to the company.

9. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred Rs. 13,02,880/- being the dividend and Fixed Deposit amount which were due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A(5) of the Companies Act, 1956.

10. UNPAID DIVIDEND STATUS

Unpaid Dividends are primarily due to Postal Returns. Effective follow-up by the Company has resulted in Unpaid Dividends being consistently below 0.5% of total. This effort is continuous till the need for transfer to Investor Education & Protection Fund arises after seven years. The table and graph given below summarise the status of Unpaid Dividends.

DIVIDEND STATUS FOR THE LAST 7 YEARS

(Rs. In lakhs)

SL YEAR SHARE DIVIDEND DIVIDEND DIVIDEND No. CAPITAL AMOUNT PAID %

1 2005-06 6921.06 15 1038.16 1034.38 (Final Dividend)

2 2006-07 6921.06 15 1038.16 1034.07 (Interim Dividend)

2006-07 6921.06 25 1730.27 1723.55 (Final Dividend)

3 2007-08 6921.06 20 1384.21 1379.28 (Interim Dividend) 2007-08 6921.06 25 1730.27 1724.09 (Final Dividend)

4 2008-09 6921.06 45 3114.48 3105.78

5 2009-10 6921.06 45 3114.48 3101.75

6 2010-11 6921.06 50 3460.53 3447.36

7 2011-12 6921.06 50 3460.53 3446.15

DIVIDEND % OF PAID % OF UNPAID UNPAID AS ON DIVIDEND DIVIDEND 31.3.2013

3.78 99.64 0.36

4.09 99.61 0.39

6.72 99.61 0.39

4.93 99.64 0.36

6.18 99.64 0.36

8.70 99.72 0.28

12.73 99.59 0.41

13.17 99.62 0.38

14.38 99.58 0.42

11. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 217(l)(e) of the Companies Act. 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are furnished in the Annexures to this Report (Annexure I and II).

12. STATEMENT OF EMPLOYEES'' REMUNERATION (217(2A)Companies Act 1956)

None of the employees drew remuneration of more than Rs.60,00,000/- per annum during the year. This information is furnished as required under section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975.

13. CASH FLOW STATEMENT

As required under Clause 32 of the Listing Agreement with the Stock Exchanges, a Cash Flow Statement prepared in accordance with the Accounting Standard (AS-3) issued by the Institute of Chartered Accountants of India is attached to the Balance Sheet.

14. EXPORT HOUSE STATUS

The Company continues to enjoy "Two Star Export House" status, awarded by the Government of India, in recognition of its export performance.

15. INDUSTRIAL RELATIONS

Industrial relations during the year continued to be cordial.

16. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed:

1. That the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the selected accounting policies were applied consistently and judgments and estimates that are reasonable and prudent were made 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 of the company for that period;

3. That the Directors have taken proper and sufficient care for the Maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. That the Annual Accounts were prepared for the financial year ended 31st March 2013 on a going concern basis.

17. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directors'' Report are enclosed as Annexure III and IV.

As required by the Listing Agreement, an Auditor''s Certificate on Corporate Governance and a Declaration by the Chairman & Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

18. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31, 2013 duly signed by the Chairman & Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 27, 2013.

19. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation for the assistance, co-operation and support extended to the company by the Govt, of Tamil Nadu, Commercial Banks, Financial Institutions, Sugar Mills and Dealers.

The Board also places on record its sincere appreciation of the positive response received from the Company''s valued customers and thanks them for their continued support.

The company is grateful to all employees for their exemplary co-operation during the year. Their contribution has been truly outstanding. The Directors place on record their appreciation of the excellent effort made by every employee to enhance the company''s performance in adverse market conditions.

Finally, the Board of Directors sincerely thanks the shareholding community for their solid support and for the confidence they have reposed in the Company.

For and on behalf of the Board

N S PALANIAPPAN

CHAIRMAN AND MANAGING DIRECTOR

Date: 27th May 2013

Place:Chennai 600 032

Mar 31, 2012

The Directors have pleasure in presenting the Thirtysecond Annual Report and the Audited Accounts of the Company for the financial year ended 31.3.2012.

1. FINANCIAL RESULTS

The Financial performance of the company for the year under review is summarized in the table below :

(Rs. in crore)

Particulars 2011-12 2010-11

Revenue from operation 1522.92 1208.50

Other income 16.07 16.54

Operating Profit (PBIDT) 435.43 362.75

Finance cost 141.26 44.24

Gross Profit (PBDT) 294.16 318.51

Depreciation 169.05 123.37

Profit before tax 125.11 195.14

Provision for tax 16.17 46.14

Profit after tax 108.94 149.00

Balance brought forward 20.91 20.83

Profit Available for appropriation 129.85 169.83

APPROPRIATIONS

Transfer to General Reserve 63.00 103.00

Debenture Redemption Reserve 5.70 5.70

Proposed Dividend 34.61 34.61

Tax on Dividend 5.61 5.61

Balance carried forward 20.93 20.91

129.85 169.83

The year 2011-12 was a challenging year for the Paper Industry in India. The overall slowdown in the economy reduced demand for paper substantially. At the same time, capacity increases by almost all paper mills increased supplies enormously. As a consequence, prices declined steeply in the market - while input costs, labour costs and interest rates escalated. Profit margins of all paper mills - including TNPL - were therefore dramatically eroded and were at the lowest in recent history. Despite the adverse market environment, the operating profit of TNPL was higher than in the previous year. This performance is indeed a commendable achievement by the Management.

2. DIVIDEND

Your Directors recommend a dividend of 50% for the financial year ended 31.3.2012. The dividend, if approved by the shareholders, will be paid to all the equity shareholders whose names appear in the Register of Members as on 21.9.2012. The proposed dividend of 50%, will cost the company Rs.40.22 crores, inclusive of taxes.

3. PERFORMANCE HIGHLIGHTS OF THE YEAR

a) Operations

1. Sales turnover crossed Rs.1500 crores for the first time in the Company's history

2. Export sales reached an all time high of 80459 tons - 24% over the previous year

3. Paper production increased from 265044 Mts. to 343306 Mts., made possible by the completion of the Mill Expansion Plan (MEP) during the year.

4. Hardwood Pulp production increased from 97492 Mts. to 107769 Mts.

5. Chemical bagasse pulp production increased by 24% from 133978 Mts. to 165914 Mts.

6. The wind farm generated 500.64 lakh units of "GREEN POWER" and earned a profit of Rs.2.86 cr.

7. The cumulative area under plantation was increased to 82025 acres. 15218 acres were added during the year benefiting 3006 farmers.

8. The Bio-meth nation Plant generated 87.35 lakh cubic metres of methane gas enabling the company to reduce consumption of furnace oil by 5207 KL valued at Rs.19.07 crores.

9. 27680 RENEWABLE ENERGY CERTIFICATES (REC) were received by the company for generating power exclusively using steam produced in the recovery boiler. TNPL is the FIRST in the paper industry to have been awarded this benefit.

10. Substantial progress has been achieved in the implementation of three important projects, i.e. setting up a 300 tpd De-inking Plant, Revamping of power and steam system and Construction of a 600 tpd mini cement plant to consume the highly polluting fly ash and lime sludge generated as waste by the factory. All three projects will be completed in 2012-2013.

11. The company received the following awards and accolades:

(a) The 'Environmental Strategy of the Year award for 2011' from PPI (Pulp and Paper International) magazine. Many global players competed for this prestigious award and TNPL emerged as the sole winner

(b) The National Award for "Excellence in Water Management 2011" from the Confederation of Indian Industry (CII) for the best water management in India in the industrial sector

(c) The Emergent Ventures India Green Business Survey has ranked TNPL No.5 among High

Energy Intensive Industries . TNPL was the only company in the Paper Industry to receive this accolade. This is in recognition of the adoption of new technologies by TNPL for value addition and all-round sustainability .

12. Despite the adverse market conditions, the Directors have proposed a Dividend of 50%. The proposed dividend is an indication of the confidence that the Directors and Management have in the company's future Financial Performance .

b) Contribution to Environment

1. The company has now fully adopted Eco friendly ECF bleaching of paper. The switch over from conventional chlorine bleaching involved a capital outlay of Rs.316 Crores.

2. The Company is now using a 'OZONE TREATMENT SYSTEM' as a tertiary step in the effluent treatment plant substantially improving the quality of effluent discharge. TNPL is the first and only company in the paper industry to make use of this 'state of the art' technology.

A Research project has been assigned to Tamilnadu Water Investment Company to identify further areas of improving the quality of effluent discharge. This will be an ongoing Research effort and the first phase will cost Rs.2.80 crores.

3. Continuous effort to reduce water consumption at the factory has paid handsome dividends. TNPL consumes the lowest amount of water in its manufacturing process compared to any other paper producer in India.

4. The commissioning of a 600 tpd high grade mini cement plant at a cost of Rs.67.46 crores has as its primary objective the consumption of highly polluting lime sludge and fly ash generated by the paper mill as waste by-products.

5. To improve the 'Air quality' in the mill area, a continuous air quality monitoring system has been installed at the factory.

6. The windfarms at Devarkulam and Perungudi with an installed capacity of 35.5 MW generated 500.64 lakh KWH Units of "GREEN POWER" during 2011-2012.

c) Corporate Social Responsibility (CSR)

1. The company is committed to being a socially responsible corporate citizen and has spent Rs.3.71 crore on its Corporate Social Responsibility Programmes in 2011-2012.

2. The objective of the company is to spend approximately 3% of the profit of the previous year for CSR activities, in the subsequent year.

3. The CSR projects focus on promoting Economic, Social, Environmental and Cultural growth in an equitable and sustainable manner, of the community living in areas surrounding the factory .

d) Contribution to Innovation and New knowledge development

1. The company is focused on creativity and innovation in its Research and Development activities. R & D activities are carried out largely in-house. A few activities are outsourced when necessary and warranted.

2. The expenditure on R&D activities has increased to Rs.5.77 Cr. from Rs.4.12 Cr. in the previous year. The long term objective is to increase R & D investment from the current level of 0.39% to 1% of sales turnover.

3. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and protection of the environment.

e) Other Highlights

1. The company is unique in India as it draws only 1.73% of its power needs from the State Grid. The company generates 98.27% of its power consumption and is also a nett exporter of power to the grid (98.98 lakh units in 2011-2012).

2. The installed production capacity has been increased during the year from 245000 tons per annum to 400000 tons per annum by the installation of a new Paper Machine (PM3). PM3 was commissioned in January 2011 and because of initial teething troubles, overall capacity utilization was only 85.83% in 2011-12.

For profitability reasons no Newsprint was produced during the year.

3. The company has repaid all the loans borrowed for implementation of the Mill Development Plan (MDP).

4. During the year, the company has unwound the hedge instruments relating to Long Term Foreign Currency loans availed of for the purpose of acquisition of depreciable Fixed Assets and received upfront cash flow of Rs.106.68 Crore from banks, being the exchange gains from the date of hedge till unwind. As per AS11 (amended) vide Notification No.GSR 913(E) and 914(E) dated 29.12.2011, the effects of changes in the Foreign Exchange rates of Rs.85.92 Crores during the year on the Foreign Currency Loans, has been capitalized. Against the cash flow realized on unwinding of hedges, the exchange gain from 01.04.2011 till unwind amounting to Rs.99.88 Crore has been recognized as income under "Exceptional Item" in the Statement of P&L.

5. The Company has tied up term loans with Banks for financing the ongoing projects viz.Deinking Plant, Revamping of Power and Steam System and the mini cement plant. Of the funds availed, pending crystallization of expenditure, the company has temporarily used the loan of Rs.89.37 crore in general business operations. The unspent loan funds will be used for the projects, when the expenditure crystallizes.

4. MARKET TRENDS

a) General

Estimated Global Production of paper in 2011-12 was 400 million tons and in India 11 million tons. India accounts for 2.75% of world production. The Per capita consumption of paper in India is approximately 10 kgs, against the global average of 57 kg.

The rate of Excise duty was increased from four to five percent in March 2011 and further increased to six percent in March 2012. Import duty, however, has been retained at 10%.

b) Printing & Writing Paper (PWP)

Between 2008 and 2010, paper mills in India increased production capacity PWP by 60% - an increase of 1.5 million tons. This was an exceptionally high increase because growth in demand is only 8-9% per annum. The Market accepted additional supplies upto June 2011. Thereafter demand declined sharply and prices crashed. Finished stocks piled up with all players in the industry. First signs of revival in demand were seen only in January 2012.

Coincidentally , Export prices also declined during the period June to December 2011.

c) Newsprint

The Newsprint prices continued to be volatile. Production in India has become economically unviable. The country imports approximately 1 million tons every year.

d) Outlook

Government spending on education will increase demand for PWP exponentially . Increasing business activities will increase demand for cut-size copy papers. The demand for PWP is expected to grow by 9% in 2012-2013. Newsprint will continue to be unviable for production in India.

In the global market, paper prices have increased by USD 80 per MT. since March 2012 . Soft wood pulp prices have increased by USD 50 per MT. and hard wood pulp prices by USD 100 .

e) TNPL response to Market Trends

In the first nine months of 2011-12 TNPL sales were level with the previous year. Because of increased production, stocks were 37,000 tons at the end of December. In terms of PBT, the company could only breakeven in the first nine months.

A revival in domestic demand from existing customers, new domestic customers and an accelerated demand growth in exports enabled the company to increase sales by 65% in the final quarter. Profitability also improved in the last quarter and was helped by a one time contribution from unwinding of the hedging on long term loans.

Finished stocks were reduced to 5816 tons.

The company's prices have been increased by Rs.2500/- per metric ton effective April 2012 and Export prices by USD 70-80 per MT. The increase in demand in both Domestic and Export markets and higher margins through price increases should result in an improved performance in 2012-13.

5. DIRECTORS

Pursuant to the orders of Government of Tamil Nadu, Thiru G Prakash IAS was co-opted as an Additional Director w.e.f.9.1.2012 in place of Thiru T K Ramachandran IAS, Managing Director.

Pursuant to the orders of Government of Tamil Nadu, Thiru Santosh K Misra IAS was appointed as Managing Director of the company vice Thiru G Praksh IAS who was holding additional charge as Managing Director. Thiru G Prakash IAS relinquished his office w.e.f.25.1.2012.

Pursuant to the orders of Government of Tamil Nadu, Thiru S Krishnan IAS was co-opted as an Additional Director w.e.f.15.9..2011 vice Thiru R Thiagarajan IAS who has retired on 31.7.2011. Thiru S Krishnan IAS will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director .

Pursuant to the orders of Government of Tamil Nadu, Thiru N Mathivanan IAS was co-opted as an Additional Director w.e.f.11.11.2011 vice Thiru Rajeev Ranjan IAS. Thiru N Mathivanan IAS will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director.

Thiru M R Kumar, Executive Director(Personnel), LIC of India has been co-opted as Additional Director w.e.f.15.9.2011 in place of Thiru D Krishnan, who resigned w.e.f.15.8.2011. Thiru M R Kumar will hold office upto the date of forthcoming Annual General Meeting and being eligible offers himself for appointment as Director.

Thiru V Narayanan , Director retires by rotation and being eligible offers himself for reappointment.

7. FIXED DEPOSITS

The company has stopped accepting fresh deposits from 1.6.2002 and renewals from 1.8.2005. The outstanding deposits as on 31.3.2012 was Rs.2.45 Lakhs against Rs.2.63 Lakhs in the previous year. The number of depositors on 31.3.2012 was 14 against 15 in the previous year. The outstanding deposits remain unpaid because the 14 depositors have not made known their new addresses to the company.

8. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred a sum of Rs.5,62,470/- being the dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years, to the Investor Education and Protection Fund, as required under Section 205A(5) of the Companies Act, 1956.

9. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 217(1)(e) of the Companies Act. 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are furnished in the Annexure to this Report (Annexure I and II).

10. STATEMENT OF EMPLOYEES' PARTICULARS

None of the employees drew remuneration of Rs.60,00,000/- or more per annum / Rs.5,00,000/- or more per month during the year. This information is furnished as required under section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 .

11. INDUSTRIAL RELATIONS

Overall industrial relations during the year were cordial.

12. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed:

1. That the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the selected accounting policies were applied consistently and judgments and estimates that are reasonable and prudent were made 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 of the company for that period;

3. That the Directors have taken proper and sufficient care for the Maintenance of adequate accounting records in accordance with the provisions of the Companies Act , 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the Annual Accounts were prepared for the financial year ended 31st March 2012 on a going concern basis.

13. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and the Report on Corporate Governance forming part of Directors' Report are enclosed as Annexures.

As required by the Listing Agreement, an Auditor's Certificate on Corporate Governance and a Declaration by the Managing Director with regard to Code of Conduct are attached to the Report on Corporate Governance.

14. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a Certificate on the Financial Statements and Cash Flow statement of the company for the year ended March 31, 2012 duly signed by the Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 29, 2012.

15. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation of the assistance, co-operation and support extended to the company by the Govt. of Tamil Nadu, the Commercial banks, Financial Institutions, the Depositors, Sugar Mills and the Indenters. The Board also places on record its sincere appreciation towards the Company's valued customers for their continued support .

The company thanks all employees for their co- operation during the year. The Directors place on record their appreciation of the excellent effort made by every employee to enhance the company's performance in an extraordinarily adverse market. Their contribution has been exemplary .

Finally, the Board of Directors are grateful for the confidence reposed in them by the shareholders. The Board salutes the shareholding community for their solid support.

For and on behalf of the Board

DR.N SUNDARADEVAN

CHAIRMAN

Date: 29th May 2012

Place:Chennai 600032.

Mar 31, 2011

TO THE MEMBERS

The Directors have pleasure in presenting the Thirtyfirst Annual Report and the Audited Accounts of your Company for the financial year ended 31.3.2011.

1. FINANCIAL RESULTS

The Financial performance of your company for the year under review is summarized in the table below:

(Rs. in crore)

Particulars 2010-11 2009-10

Sales 1184.44 1025.68

Other income 40.59 47.94

Operating Profit (PBIDT) 362.75 319.80

Interest and Finance charges 44.24 46.18

Gross Profit (PBDT) 318.51 273.62

Depreciation 123.37 115.56

Profit before tax 195.14 158.06

Provision for tax 46.14 32.00

Profit after tax 149.00 126.06

Balance brought forward 20.83 21.77

Profit Available for appropriation 169.83 147.83

APPROPRIATIONS

Transfer to General Reserve 103.00 85.00

Debenture Redemption Reserve 5.70 5.68

Proposed Dividend 34.61 31.14

Tax on Dividend 5.61 5.17

Balance carried forward 20.91 20.84

169.83 147.83

The company has achieved a higher PBDT and PAT compared to the previous year despite adverse conditions in the domestic and export markets and increase in input costs. This financial performance is indeed a commendable achievement by the Management.

2. DIVIDEND

Your Directors are pleased to recommend a dividend of 50% for the financial year ended 31.3.2011. The dividend, if approved by the shareholders, will be paid to all the equity shareholders whose names appear in the Register of Members as on 15.9.11. The dividend of 50 % for the year 2010-11 will cost the company Rs.40.22 crore, inclusive of taxes.

3. PERFORMANCE HIGHLIGHTS OF THE YEAR

1. Sales crossed Rs.1000 Cr. for the third consecutive year. Current year sales of Rs. 1184.44 Cr. is the highest ever achieved so far.

2. The Profit after tax has increased by 18.20% from Rs. 126.06 crore to Rs. 149.00 crore despite increase in input costs.

3. The dividend has been increased to 50% from 45% in the previous year.

4. The production capacity is increased from 245,000 tonnes per annum to 400,000 tonnes per annum and the inhouse Pulp capacity from 720 tpd to 880tpd.

5. Exports Sales leaped dramatically from 50,394 MTs. to 64,776 MTs.

6. Hardwood Pulp production increased to 97,492 MTs. from 95,514 MTs in the previous year.

7. The wind farm generated 598.70 lakh units of Wind Power and earned a profit of Rs.4.56 cr.

8. Pulp wood plantation touched a new peak of 15,379 acres in a single year.

9. The Bio-methanation Plant generated 59.34 lakh cubic metres of methane gas enabling the company to save consumption of 3,545 KL of furnace oil.

10. Achieved capacity utilization of 99.91 % in PM 1 & PM 2 and 60.92% in PM 3 in the first 72 days of operation with no introductory discount for new products.

11. Adjudged as the best performer at the National level in Pulp & Paper category in the EVI Green Business Survey.

12. a) Received FSC Chain of Custody (C-o-C) and Controlled Wood Certificate from M/s Smart Wood Program of Rainforest Alliance, USA for complying with FSC-STD-40-004 and FSC-STD-40-005 standards.

b) Received National Award for "Excellence in Water Management 2010" from Confederation of Indian Industry (CII) for the best performance in Water Management in India among the Industrial Sectors.

13. The Mill Expansion Plan was completed during the year and the commercial production was commenced on 19.1.2011. Three other projects viz. setting up of a 300 tpd De-inking Plant, Revamping of power and steam system and setting up of a 600 tpd cement plant under lime sludge and fly ash management system are taken up for implementation during the year. The Cement Plant is likely to be completed by December 2011, De- inking plant by March 2012 and Revamping of power and steam system by April 2012.

4. CONTRIBUTION TO ENVIRONMENT/ POLLUTION CONTROL.

1. Your company has switched over completely from conventional bleaching to environmentally friendly ECF bleaching involving a capital outlay of Rs. 316 crore.

2. Reduction in water consumption has made your Company the lowest in water consumption in manufacture of fine paper.

3. Your Company has introduced 'Ozone Treatment System' in the effluent treatment as a tertiary treatment for improving the quality of effluent discharge .

4. A Research project has been assigned to Tamilnadu Water Investment Company, Chennai for further improving the quality of effluent discharge. The pilot plant involving capital expenditure of about Rs.2.00 crore is under erection.

5. Project work relating to converting waste lime sludge and fly ash generated in the paper mill into high grade cement has been taken up for execution. This will make TNPL one of the most eco-friendly companies in India.

6. Continuous ambient air quality monitoring system has been commissioned to monitor the quality of air in the mill area.

7. Your Company's windfarm with a total installed capacity of 35.5 MW at Devarkuarm and Perungudi in Tirunelveli District has generated 598.70 lakh kWh Units of "Green Power".

5. CONTRIBUTION TO SOCIETY

1. Your company is committed to being a socially responsible corporate body and has spent Rs.3.24 crore under its Corporate Social Responsibility Programme (CSR) during the year.

2. The CSR Policy of your company has as its aim, an expenditure of 3% of the profit of the previous year for CSR activities in the subsequent year.

3. The CSR projects focus on promoting Economic, Social, Environmental and Cultural growth of the community at large in an equitable and sustainable manner in the areas surrounding the factory and in peripheral areas around the factory.

6. CONTRIBUTION TO INNOVATION AND NEW KNOWLEDGE DEVELOPMENT

1. Your company gives great importance to all creative ideas in its Research and Development activities.

2. The expenditure on R&D activities has increased to Rs.4.12 Cr. from Rs.3.53 Cr. in the previous year. The long term plan is to increase R&D investment to atleast 1% of the turnover, from the current level of 0.34%.

3. The R&D activities focus on product development, process improvement, raw material substitution, development of new products and environment protection.

4. R & D projects are carried out in-house. Projects are outsourced when necessary and warranted.

7. OVERALL PERFORMANCE- OTHER HIGHLIGHTS

The production and capacity utilization are given hereunder;

(Figures in MTs)

Particulars 2010-11 2009-10

PMI PMII PMIII Total PMI PMII Total

Newsprint - - - - - - -

PWP 116921 127861 20262 265044 114610 130398 245008

Total 116921 127861 20262 265044 114610 130398 245008

Capacity 99.91% 60.92% l00.00%

Utilisation (%)

Your company has achieved an overall capacity utilization of 99.91% in Paper Machines 1 & 2 and 60.92% in Paper Machine 3 in its first 72 days of operation. During the year, your company has not produced Newsprint. The entire resources were utilised to produce Printing & Writing Paper in order to improve profitability.

Power Exports during the year was 295.37 lakh units against 158.10 lakh units in the previous year. Total power generation during the year was 4561.23 lakh units against 4103.81 lakh units in the previous year During the year, your company has drawn only 16.01 lakh units of power from the State grid, equivalent to 1% of the total consumption. Your company is therefore generating almost its entire requirements of power.

Bagasse stock at the end of the year was 3,39,837 MTs. With the implementation of several water conservation measures, water consumption stands reduced to 55 kl. per metric tonne, of finished production, the lowest in manufacture of fine paper using virgin fibre.

The Company has tied up term loans with Banks for financing the ongoing projects viz.De-inking Plant , Revamping of Power and Steam System and 600 tpd Cement Plant. Of the funds availed, pending crystallization of expenditure, the company has temporarily applied the loan proceeds of Rs.37.58 crore for general business operation. The unspent loan funds would be applied for the purpose when the expenditure crystallizes.

8. MARKET TRENDS

a) Printing and Writing Paper

The printing and writing paper demand and prices were affected adversely by the global economic slowdown since October 2008. Demand started improving from February 2010. The prices declined to about USD 700-750 per MT during October- December 2008 and remained at that level until January 2010. Export prices started firming up slowly from February 2010. Your company has exported 64,776 MTs. of Printing & Writing Paper during the year against 50,394 MTs. in the previous year.

Since 2008, many major players in the Indian Paper Industry have expanded their capacities. With the significant growth in consumption, the additional capacities have been fully absorbed.

Import duty on printing and writing paper has been retained at 10% The excise duty was reduced from 8% to 4% effective 7th December 2008. This has subsequently been increased to 5% from 1st March 2011. Simultaneously, excise exemption allowed on the first 3500 MTs of PWP produced out of non-conventional raw material has also been withdrawn.

TNPL Copier Brand has become a household name in the copier segment.

b) Newsprint

Newsprint which registered a sharp price increase between July 2008 and January 2009 started declining since February 2009 and stabilized at about USD 600 per MT till May 2010. For most part of the current year, the imported newsprint was being traded at about USD 650 pmt. and since April 2011 being traded at about USD 690 pmt. The newsprint prices are volatile and uneconomical. In view of the low profitability, your company resorted to manufacture of printing and writing paper only.

9. OUTLOOK

a) Printing and Writing Paper

The per capita paper consumption is estimated at 9.2 kg. The demand has picked up from January 2011 in both the domestic market and exports.

Increase in spending by the Government on Education is likely to boost demand for writing paper from the academic segment. With the consistent economic growth, demand for packaging paper will also show improvement.

There has been a sharp increase in fuel and pulp prices during the year. Coal price increased by about 25%, Hardwood pulp by 15% and Softwood pulp by 25% during the year. The spiralling cost has prompted the Industry to increase prices to sustain margins.

b) Newsprint

The Newsprint production in the country during the year grew by about 3.2%. The growth in newsprint production is very low as majority of the demand is being met by imports. The imported newsprint is considered good in quality and lower in price.

10. FIXED DEPOSITS

Your company has stopped accepting fresh deposits from 1.6.2002 and renewals from 1.8.2005. The outstanding deposits as on 31.3.2011 was Rs.2.63 Lakhs against Rs.4.43 Lakhs in the previous year. Number of depositors as on 31.3.2011 was 15 against 25 depositors in the previous year. Since the depositors are not available in the given addresses, the outstanding remains undisbursed.

11. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred a sum of Rs.5,81,760/- to the Investor Education and Protection Fund, the dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years , as required under Section 205A(5) of the Companies Act, 1956.

12. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 217(l)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are furnished in the Annexures to this Report (Annexure I and II).

13. STATEMENT OF EMPLOYEES' PARTICULARS

None of the employees drew remuneration of Rs.60,00,000/- or more per annum / Rs.5,00,000/- or more per month during the year. This information is furnished as required under section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975.

14. DIRECTORS

Pursuant to the orders of Government of Tamil Nadu, Dr.N Sundaradevan IAS has been co-opted as an Additional Director w.e.f.27.5.2011 in place of Thiru Rajeev Ranjan IAS who has taken charge as Commissioner of Sugar. Dr.N Sundaradevan IAS will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director in the Annual General Meeting . Further, vide Government Order dt.26.5.2011, Dr.N Sundaradevan IAS has been nominated as Chairman of the Company.

Vide Government Order dt.25.5.2011, Thiru Rajeev Ranjan IAS has been nominated as a Director on the Board of TNPL in place of Thiru Vikram Kapur IAS.

Tvl . N Kumaravelu and D.Krishnan, Directors retire by rotation and being eligible are seeking for re- appointment as Directors at the next Annual General Meeting.

15. COST AUDITORS

Pursuant to orders of the Department of Corporate Affairs, M/s S Mahadevan & Co, Cost Accountants, Chennai have been appointed as Cost Auditors of your Company for the year 2010-2011.

16. STATUTORY AUDITORS

The Comptroller and Auditor General of India has appointed M/s. P.B Vijayaraghavan & Co., Chartered Accountants, Chennai as the Auditors of your Company for the year 2010-2011.

17. SECRETARIAL AUDITOR

Secretarial Audit of the company for the financial year ended March 31, 2011 has been carried out through M/s R. Sridharan & Associates, Practising Company Secretaries. The Secretarial Audit Report confirms that the company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreement with the Stock Exchanges and all the regulations of SEBI as applicable to the company.

18. INDUSTRIAL RELATIONS

Overall industrial relations during the year were cordial. The Directors place on record their appreciation of the valuable contribution made by the employees of your Company towards the performance and growth of your Company.

19. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed:

1. That the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. That the selected accounting policies were applied consistently and judgments and estimates that are reasonable and prudent were made 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 of the company for that period;

3. That the Directors have taken proper and sufficient care for the Maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. That the annual accounts were prepared for the financial year ended 31st March 2011 on a going concern basis.

20. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and Report on Corporate Governance are forming part of Directors' Report and are annexed as Annexure III and Annexure IV.

As required by the Listing Agreement, an Auditor's Certificate on Corporate Governance and a Declaration by the Managing Director with regard to Code of Conduct are attached to the said report.

21. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a Certificate on the financial statements and Cash Flow statement of the company for the year ended March 31, 2011 duly signed by the Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 27, 2011.

22. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation of the assistance, co-operation and support extended to your company by the shareholders, the Govt, of Tamil Nadu, the Commercial banks, Financial Institutions,the Depositors, Sugar Mills and the indentors. The Board also places on record its sincere appreciation towards the Company's valued customers for the support and confidence reposed by them in the organization and looks forward to the continuance of this mutually supportive relationship in future.

For and on behalf of the Board

DR.N SUNDARADEVAN

CHAIRMAN

Date: 27th May 2011

Place:Chennai 600032.

Mar 31, 2010

The Directors have pleasure in presenting the Thirtieth Annual Report and the Audited Accounts of your Company for the financial year ended 31.3.2010.

1. FINANCIAL RESULTS

The Financial performance of your company in the year under review is summarized in the table below :

(Rs. in crore)

Particulars 2009-10 2008-09

Sales 1025.68 1066.46

Other income 47.94 33.84

Operating Profit (PBIDT) 319.80 307.92

Interest and Finance charges 46.18 49.27

Gross Profit (PBDT) 273.62 258.65

Depreciation 115.56 100.80

Profit before tax 158.06 157.85

Provision for tax 32.00 50.47

Profit after tax 126.06 107.38

Balance brought forward 21.77 22.42

Profit Available for

appropriation 147.83 129.80

APPROPRIATIONS

Transfer to General Reserve 85.00 68.00

Debenture Redemption Reserve 5.68 3.60

Proposed Dividend 31.14 31.14

Tax on Dividend 5.17 5.30

Balance carried forward 20.84 21.76

147.83 129.80

The company has achieved a higher PBDT and PAT compared to the previous year - despite extremely adverse conditions prevailing in the domestic and export markets. This financial performance is indeed a commendable achievement by the Management.

2. DIVIDEND

Your Directors are pleased to recommend a dividend of 45% for the financial year ended 31.3.2010. The dividend, if approved by the shareholders, will be paid to all the equity shareholders whose names appear in the Register of Members as on 8th September 2010. The dividend of 45% for the year 2009-10 will cost the company Rs. 36.31 crore, inclusive of taxes.

3. PERFORMANCE HIGHLIGHTS OF THE YEAR

1. Sales crossed Rs. 1000 crore for the second consecutive year in the companys history.

2. The Profit after tax has increased by 17.39% from Rs. 107.38 crore to Rs. 126.06 crore - despite the adverse economic environment.

3. The dividend has been maintained at 45%

4. Substantial progress has been made in the execution of the Mill Expansion Plan (MEP) to increase capacity from 2,45,000 tonnes to 4,00,000 tonnes per annum. The project is likely to be completed by October 2010. The overall cost of MEP will be Rs.1000 crore.

5. Copier production during the year was 57395 tonnes.

6. 50394 Mts. of Printing & Writing Paper were exported during the year to 44 countries - an increase of 50.6% over 2008-09.

7. Hardwood Pulp production was 95514 Mts. against 84854 mts in the previous year

8. The wind farm earned a profit of Rs.588.34 lakh during the year through the generation of 644.30 lakh units of windpower.

9. Cumulatively 51220 acres of land has been brought under this companys Farm Forestry Scheme and Captive Plantation Scheme, benefiting over 10,008 farmers.

10. The Bio-methanation Plant generated 57.98 lakh cubic metres of methane gas enabling the company to reduce consumption of 3,459 KL of furnace oil.

11. Life Cycle Extension Project of Paper Machine I was completed by April 2009 at a capital investment of Rs.81.93 crore.

12. Your company has achieved an overall capacity utilization of 100%.

4. CONTRIBUTION TO ENVIRONMENT/POLLUTION CONTROL

1. Your company has switched over from conventional bleaching to environmentally friendly ECF bleaching at a capital cost of almost Rs.400 crore.

2. Water consumption has been substantially reduced and is now the lowest in the Indian Paper Industry.

3. An Ozone Treatment System is under implementation for the first time in the Indian Paper Industry. The project will be completed by June 2010 and will clean up the effluent discharge.

4. A new Research project has been awarded to TWIC (Tamilnadu Water Investment Company) to improve the quality of effluent discharge even further.

5. Steps are being taken to convert the waste lime sludge and fly ash generated in the paper mill into good quality cement. This will make TNPL one of the most ecofriendly companies in India.

6. Energy conservation and Rain Harvesting have been given the highest priority. Your company has received an award from CII for being the most Energy Efficient Unit in 2009.

5. CONTRIBUTION TO SOCIETY

1. Your company spent Rs.2.52 crore under its Corporate Social Responsibility Programme (CSR). The expenditure will be increased to Rs.3.78 crore in 2010-11.

2. Your Directors are committed to increase the spend level on CSR progressively to 3% of the total profits.

3. The CSR projects focus on providing education, improving health care and supporting the under privileged sectors of society in the community in and around the Kagithapuram factory.

4. The CSR Award was given to the company by Government of Tamil Nadu for the year 2007-08.

6. CONTRIBUTION TO INNOVATION AND NEW KNOWLEDGE DEVELOPMENT

1. Investment in R&D is the cornerstone through which the company becomes a leader in Innovation and Knowledge Development.

a 2. The expenditure on R&D activities has increased by

110% in 2009-10 compared to the previous year.

3. The long term plan of the Board is to increase R&D investment to atleast five times the current level.

4. The R&D activities will focus on product development, process improvement, raw material substitution, new products and environment protection.

5. R&D projects will be carried out in-house. However, projects will be outsourced when necessary and warranted.

7. OVERALL PERFORMANCE - OTHER HIGHLIGHTS

The production and capacity utilization are given hereunder:

(Figures in MTs)

Particulars 2009-10 2008-09 PMI PMII Total PMI PMII Total

Newsprint - - - - 1514 1514

PWP 114610 130398 245008 112556 140833 253389

Total 114610 130398 245008 112556 142347 254903

Capacity

Utilisation

(%) 100.00 105.37

Your company has achieved an overall capacity utilization of 100.00%. The strategy of keeping the entire production as printing and writing paper has helped maintaining the profitability during the year.

With the rise in coal price, export of power under normal tariff was uneconomical. Therefore, power export during the year was restricted to the barest minimum of 158.10 lakh units against 208.93 lakh units in the previous year. Total power generation during the year was 4103.81 lakh units against 3994.88 lakh units in the previous year. During the year, your company has drawn 21.72 lakh units of power from the State grid, equivalent to less than 1% of the total consumption.

Bagasse stock at the end of the year was 286734 MT. With the company switching over to ECF bleaching and implementation of various water conservation measures, water consumption was reduced to an average of 66 kl. per MT of finished production during the year. On implementation of Mill Expansion Plan during 2010-11, water consumption would be further reduced.

TNPL has already registered two Clean Development Mechanism (CDM) Projects with United Nations Framework Convention on Climate Change (UNFCCC), one in the waste management sector (bio gas) and another in the renewable energy sector (wind farm). These two projects generate about 54000 Certified Emission Reduction (CER) per annum. TNPL is presently working on three more CDM projects viz. Energy efficiency improvement in Chemical Recovery boiler, generation of biogas from mill waste for replacing the usage of furnace oil and wind farm. These projects are likely to be registered with UNFCCC during the current financial year.

The Company has spent Rs.840.79 crore for MEP upto 31.3.2010. The Project is expected to commence operation by October 2010. During the year, the Company temporarily utilized short term funds Rs.50.67 crore for the Project. This portion has eventually been tied up in the form of long term loans with banks as on 31.3.2010.

8. MARKET TRENDS

a) Printing and Writing Paper

The global economic slowdown has impacted the printing and writing paper demand and prices adversely across all grades. The prices declined from USD 900-950 per MT to about 700-750 per MT during November-December 2008 and remained at that level until January 2010. The export market started firming up slowly from February 2010. In spite of the tough market conditions for most of the year, your company has exported 50394 MT of Printing & Writing Paper against 33461 MT in the previous year.

Since 2008, many major players in the Indian Paper Industry have expanded the capacity. Consequently, supply has been much higher than demand during the year. This, coupled with the global economic crisis, has adversely impacted Indian Paper Industry for about 15 months since November 2008.

In the domestic market, the mills reduced the Printing & Writing Paper prices by about Rs.3000-4000 per MT. during the year, as the market was sluggish and the mills were holding huge inventory till the end of the year. Import duty on printing and writing paper remained at 10% during the year and with effect from 7th December 2008, the Govt, of India have reduced the excise duty from 8% to 4% to improve the paper consumption and this continues till date. No excise duty is levied on the first 3500 MT of PWP produced primarily out of non-conventional raw material.

Capacity addition during 2010-11 is likely to be about 5 lakh MT. Capacity addition during 2011-12 is likely to be very marginal.

TNPL Copier has become a household name in the copier segment. During the year 2009-10, your company produced 57395 MT and sold 57172 MT of Copier. This is the seventh year in a row in which your company has increased the copier production. However, this segment is likely to face competition in the coming years as more players, including recycled paper manufacturers have entered the market. In order to cater different end- customers, your company has launched 4 different varieties of copier papers namely TNPL Commander (70 gsm), TNPL Runner (75 gsm), Copy Crown (75 gsm) and Perfect Copier (85 gsm).

b) Newsprint

Newsprint which registered a sharp price increase between July 2008 and January 2009 started declining since February 2009. Newsprint price was about USD 520 per

MT during April-June 2009, USD 480 per MT during July- Aug 2009 and thereafter stabilized between USD 550 - USD 600 per MT till March 2010. In line with the imported newsprint price, domestic newsprint also witnessed a steep fall in price during 2009-10.

9. OUTLOOK

Printing & writing paper consumption is expected to grow by 7% per annum and Newsprint by 4-5% per annum. The literacy drive supported by the Govt, and consistent economic growth at 7-8% per annum are the key drivers of growth in the printing and writing paper. Within the printing & writing paper, branded copier is fast growing at about 19% per annum while non-surfaced paper growing at 5-6% and surfaced size maplitho at 8-9% per annum.

Waste paper prices in the global market hardened from December 2009. Hardwood pulp prices increased from about USD 400 per ADMT in April 2009 to about USD 850 per ADMT in March 2010 and softwood pulp prices from USD 458 per ADMT in April 2009 to USD 950 per ADMT in March 2010 due to short supplies. Pulp prices are likely to remain at the current level for few more months till demand supply mismatches are narrowed down.

The spurt in the waste paper and pulp prices and the general increase in demand have helped demand for paper and paper products both in the domestic market and export. Impacted by the increase in cost and improvement in the demand scenario, the mills have increased the Printing & Writing Paper prices since April 2010 in the domestic market and export.

If the demand scenario in domestic and export markets continues, 2010-11 should be a good year for TNPL.

10. FIXED DEPOSITS

Your company has stopped accepting fresh deposits from 1.6.2002 and renewals from 1.8.2005. The outstanding deposits as on 31.3.2010 was Rs.4.43 Lakh against Rs.6.44 Lakh in the previous year. Number of depositors as on 31.3.2010 was 25 against 39 depositors in the previous year.

11. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the year, the company has transferred a sum of Rs.569693/- to the Investor Education and Protection Fund, the dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years, as provided in Section 205A(5) of the Companies Act, 1956.

12. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars required under Sec. 217(l)(e) of the Companies Act. 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are furnished in the Annexures to this Report (Annexure I and II).

13. STATEMENT OF EMPLOYEES PARTICULARS

The statement of employees, referred to in sub-section (2A) of Section 217 of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is given in Annexure-III and forms part of this report. The employee shown therein is not a relative of any director of the company.

14. DIRECTORS

Pursuant to the orders of Government of Tamil Nadu, Thiru Rajeev Ranjan IAS has been co-opted as an Additional Director in place of Thiru M F Farooqui IAS w.e.f.22.12.09. Thiru Rajeev Ranjan IAS will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director in the Annual General Meeting. Further, vide Government Order dt.7.12.09 Thiru Rajeev Ranjan IAS has been nominated as Chairman of the company.

Pursuant to the orders of Government of Tamil Nadu, Thiru Vikram Kapur IAS, has been appointed as an Additional Director w.e.f. 28.4.2010 in place of Thiru Dayanand Kataria IAS. Thiru. Vikram Kapur IAS will hold office upto the date of forthcoming Annual General Meeting and is eligible for appointment as Director in the Annual General Meeting.

Tvl. V.Narayanan and V.R.Mehta, Directors retire by rotation and are being eligible for re-appointment as Directors in the forthcoming Annual General Meeting.

15. COST AUDITORS

Pursuant to orders of the Department of Company Affairs, M/s Sam Services, Cost Accountants, Chennai have been appointed as Cost Auditors of your Company for the year 2009-2010.

16. STATUTORY AUDITORS

The Comptroller and Auditor General of India has appointed M/s. P.B Vijayaraghavan & Co., Chartered Accountants, Chennai as the Auditors of your Company for the year 2009-2010.

17. SECRETARIAL AUDITOR

Secretarial Audit of the company for the financial year ended March 31, 2010 has been carried out through M/s R. Sridharan & Associates, Practicing Company Secretaries. The Secretarial Audit Report confirms that the company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreement with the Stock Exchanges and all the regulations of SEBI as applicable to the company.

18. INDUSTRIAL RELATIONS

Overall industrial relations during the year were cordial. The Directors place on record their appreciation of the valuable contribution made by the employees of your ; Company towards the performance and growth of your

Company.

19. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby confirmed:

a) That the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) That the selected accounting policies were applied consistently and judgments and estimates that are reasonable and prudent were made 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 of the company for that period;

c) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) That the annual accounts were prepared for the financial year ended 31st March 2010 on a going concern basis.

20. CORPORATE GOVERNANCE

The Report on Management Discussion and Analysis and Report on Corporate Governance are forming part of Directors Report and are annexed as Annexure - IV and Annexure V.

As required by the Listing Agreement, an Auditors Certificate on Corporate Governance and a Declaration by the Managing Director with regard to Code of Conduct are attached to the said report.

21. CEO/CFO CERTIFICATION

As required by Clause 49 of the Listing Agreement, a certificate on the financial statements and Cash Flow statement of the company for the year ended March 31, 2010 duly signed by the Managing Director and Deputy Managing Director was submitted to the Board of Directors at the meeting held on May 25, 2010.

22. ACKNOWLEDGEMENT

The Board has pleasure in recording its appreciation of the assistance, co-operation and support extended to your company by the shareholders, the Govt, of Tamil Nadu, the Commercial banks, Financial Institutions, the Depositors, Sugar Mills and the indentors. The Board also places on record its sincere appreciation towards the Companys valued customers for the support and confidence reposed by them in the organization and looks forward to the continuance of this mutually supportive relationship in future.

For and on behalf of the Board

RAJEEV RANJAN, IAS

CHAIRMAN Date: 25th May 2010

Place: Chennai 600 032

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