Your Directors have pleasure in presenting the 39^th Annual Report on the business and operations of the company and the audited financial statements for the year ended 31st March 2025.

2) Dividend

Considering financial strain, your Directors have not recommended dividend for the year 2024-25. Also no amount has been transferred to reserves.

3) Financial Performance

During the financial year 2024-25, your Company recorded a total income of ' 65,356.87 lakhs, as compared to ' 77,638.28 lakhs in the previous year. The Company earned a net profit before tax of ' 1,107.57 lakhs, as against ' 2,106.05 lakhs in the previous year. The net profit after tax stood at ' 809.10 lakhs, compared to ' 1,375.77 lakhs in the financial year 2023-24.

4) Operational Performance

The operational highlights of our sugar, cogeneration, and distillery divisions for the year 2024-25 are as follows:

a) Sugar Division

In FY 2024-25, sugar production declined by 35% compared to the previous year due to a significant drop in sugarcane availability. Lower cane crush and reduced recovery (8.14% vs. 8.53%) were primarily caused by adverse weather conditions in the command area, which affected sugar content in the cane.

b) Cogeneration Division

In the fiscal year under review, the Cogeneration Division produced a total of 1,488 lakh units of power, compared to 2,233 lakh units in the previous year. The Company exported 886 lakh units during the year, as against 1,414 lakh units exported in the preceding year.

c) Distillery Division

During the year, the Distillery Division produced 187 lakh litres of alcohol, compared to 240 lakh litres produced in the previous year. The sales volume stood at 192 lakh litres, as against 231 lakh litres sold during the previous financial year.

5) One Time Settlement with Sugar Development Fund, Government of India.

During the year, the Company concluded a One Time Settlement (OTS) with the Sugar Development Fund (SDF), Ministry of Consumer Affairs, Food & Public Distribution, for outstanding dues related to Ethanol and Co-generation loans amounting to ' 53.55 crore (' 32.45 crore for ethanol and ' 21.10 crore for cogeneration). As per the Administrative Approvals dated 26^th September 2024 and in line with revised operational guidelines issued by the Government, the Company settled the loans by paying ' 58.56 crore, inclusive of accrued interest and after waiver of ' 6.45 crore in penal interest. Final confirmation of receipt was provided by SDF on 21^st March 2025.

Rule 8 of the Companies (Accounts) Rules, 2014 requires disclosing the difference between the loan amount at sanction and at One Time Settlement (OTS), along with reasons, in cases involving banks or financial institutions.

In this case, the OTS was with the Sugar Development Fund (SDF), a statutory government body, not a bank or financial institution. The original loan sanctioned was ' 53.55 crore, and the final settlement amount was ' 58.56 crore. The ' 5.01 crore difference is due to accrued interest, while penal interest of ' 6.45 crore was waived by SDF. No asset valuation was conducted at the time of sanction or settlement.

Rule 8 does not apply, as the settlement was not with a bank or financial institution. Disclosure is made voluntarily for transparency.

6) Future Outlook

The management believes that no material uncertainty exists about the company's ability to continue as a going concern and accordingly the management has prepared these financial statements on a going concern basis.

As a result of good monsoon, the ground water recharge in the command areas of the Company has been encouraging for cane planting and thereby factory operations for next two years. However, emergence of Competitive crops with remunerative prices could pose a threat to Sugarcane Cultivation. The company is taking special measures like providing subsidy, services like appointing service providers for cultivation operations, mechanical harvesting and supply of regular seed materials. The company is also promoting wider row planting, drip irrigation, trash shredding, trash mulching and organic manure application. The company's R&D wing is also working on research and development of new and high yielding varieties.

In the sugar season 2023-24 (October to September), the Government had not allowed export due to lower sugar production. However, since the stock position as on 30.09.2024 was higher than the original estimate, the Government had allowed an export of 1 million tons in sugar season 2024-25. With the production in Maharashtra and north Karnataka lower than the estimated numbers, situation on the domestic prices looks positive in the current seasons.

The ambitious ethanol program of the Central Government continues to be supportive to the sugar industry.

Further, the Government policy on sugar would continue to have a significant bearing on the prospects of the industry in the coming years.

7) Fixed Deposits

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 ('the Act) and the Companies (Acceptance of Deposits) Rules, 2014 during the year under review.

8) Auditors

Statutory Auditors: M/s.S.Krishnamoorthy & Co., Chartered Accountants, Coimbatore (Firm Registration No. 001496S), will serve as Auditors until the 40th Annual General Meeting (AGM) for the financial year ending 31^st March 2026.

Cost Auditors: As per Section 148 of the Act and the Companies (Cost Records and Audits) Rules, 2014, the company's products Sugar, Industrial Alcohol, and Cogeneration of Power, are subject to mandatory cost audits. The company has maintained these records as prescribed by the Central Government. Upon the Audit Committee's recommendation, the Board of Directors has re-appointed M/s.S.Mahadevan & Co., Cost Accountants, (Firm Registration 000007) to conduct the cost audit for the financial year ending 31^st March 2026. Their remuneration has been fixed, and the resolution for its ratification under Section 148(3) of the Act, will be presented at the upcoming AGM.

Secretarial Auditor: Mr. G. Soundarrajan, Practicing Company Secretary (Membership No. 13993; CP No. 4993; Peer Review No. 2101/2022), is currently serving as the Secretarial Auditor for the financial year 2024-25 to conduct the Secretarial Audit in accordance with Section 204 of the Act and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the recommendation of the Audit Committee, the Board has approved his appointment for a fixed term of five financial years from FY 2025-26 to FY 2029-30, in line with the provisions of Regulation 24A as amended by the SEBI (LODR) (Third Amendment) Regulations, 2024. The said appointment is subject to the approval of the shareholders at the ensuing Annual General Meeting.

9) Conservation of energy, technology absorption, foreign exchange earnings and outgo

Annexed to this Report as Annexure 1.

10) Corporate Governance Report (CGR)

The Company is committed to maintaining the highest standards of corporate governance and adherence to the corporate governance requirements prescribed by SEBI. The Company also follows several best corporate governance practices as prevalent globally. The report on Corporate Governance as stipulated under LODR forms an integral part of this Report as Annexure 2. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is also attached to the report on Corporate Governance.

11) Corporate Social Responsibility (CSR)

The Company has not earned net profit during the Financial Year ended 31^st March 2025, computed as per section 198 of the Act, and hence, provisions relating to CSR as specified under Section 135 of the Act will not be applicable to the Company.

The details regarding the CSR Committee and Policy are furnished in the CGR.

12) Details of Directors and Key Managerial Personnel Appointed or Resigned

During the year, the following changes in the composition of the Board of Directors and Key Managerial Personnel took place:

At its meeting held on 29^th May 2025, the Nomination and Remuneration Committee, followed by the Board of Directors, recommended to the shareholders the appointment of Mr. Rajan Balasubramanian (DIN: 10309315) as an Independent Director for an initial term of five consecutive years commencing from the conclusion of the 39^th Annual General Meeting and ending on the date of the 44^th Annual General Meeting or on completion of five years, whichever is earlier.

Mr. Balasubramanian has submitted the requisite declarations confirming his eligibility and independence in accordance with Section 149(6) of the Companies Act, 2013 and Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations. His appointment is proposed to succeed Mr. S. Krishnaswami (DIN: 08530320), whose second term as an Independent Director is scheduled to conclude on 29^th September 2025.

The Board recognises Mr. Balasubramanian's professional integrity, strategic insight, and extensive experience, and is of the opinion that his inclusion will strengthen the independence and effectiveness of the Board's oversight functions. His appointment was made following a rigorous evaluation process in line with the Company's governance standards and selection criteria for Independent Directors.

13) Statement on Formal Annual Evaluation by the Board

In accordance with the Companies Act, 2013 and SEBI regulations, the Board carried out a formal annual evaluation of its own performance, that of its Committees, and individual Directors, including Independent Directors and the Chairperson.

The evaluation was coordinated by the Nomination and Remuneration Committee (NRC) through structured online feedback forms circulated to all Directors. The submitted responses were compiled and presented by the Chairperson during a Board meeting.

The evaluation covered the Board's strategic oversight, governance, and performance monitoring; Committees were assessed on effectiveness, independence, and role clarity; Directors were evaluated on domain knowledge, participation, and strategic input. Independent Directors were additionally assessed on independence and objectivity, while the Chairperson's evaluation included leadership, discussion facilitation, and stakeholder focus.

The NRC adopted a five-point grading scale: Poor, Average, Good, Very Good, and Excellent.

14) Number of Board Meetings

During the year, 5(Five) Board Meetings were convened and held, the details of which, including attendance of directors, are given in the CGR.

15) Declaration given by Independent Directors

The Independent Directors of the Company have furnished declarations as required under Section 149(6) of the Act & Regulation 16 of LODR.

16) Whistle Blower Policy (Vigil Mechanism)

In accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, the Company has established a Vigil Mechanism (Whistle Blower Policy) to enable Directors and employees to report genuine concerns regarding unethical conduct, actual or suspected fraud, and violations of the Company's Code of Conduct or ethics policies.

The mechanism provides adequate safeguards against victimization of those who report such concerns and allows for direct access to the Chairman of the Audit Committee in all cases.

The Whistle Blower Policy is available on the Company's website at: www.rajshreesugars.com/policies/

17) Particulars of Loans, Guarantees or Investments under Section 186

The Company has not given/ made any loan, guarantee or investment in terms of Section 186 of the Act during the year under review.

18) Anti-Sexual Harassment Policy

The Company has in place a policy for the prevention, prohibition, and redressal of sexual harassment of women at the workplace, in accordance with the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

As required under the Act, the Company has constituted an Internal Complaints Committee to address complaints in a fair and timely manner. For the financial year ended 31^st March 2025, no complaints were received under the said Act.

19) Related Party Transactions

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of business. There were no material contracts / arrangements / transactions with related parties during the year.

20) Material Changes & Commitments between end of financial year and this Report

There were no material changes that took place between the end of the financial year and this report.

21) Managerial Remuneration

The details of disclosures relating to Managerial Remuneration as required pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed (Annexure 3).

22) Nomination and Remuneration Policy

The Nomination and Remuneration Committee (NRC), in consultation with the Board of Directors, has framed a comprehensive Remuneration Policy in line with Section 178 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations. The policy aims to ensure fair, balanced, and performance-linked remuneration for Directors, Key Managerial Personnel (KMP), Senior Management Personnel (SMP), and other employees.

The policy ensures that remuneration is sufficient to attract and retain competent leadership, and that it maintains a clear relationship with performance benchmarks. It provides for a balance between fixed and incentive-based pay to support both short-term results and long-term goals of the Company.

The policy outlines the framework for appointment, evaluation, and removal of Directors, KMPs, and SMPs, along with remuneration structures, including provisions for shareholder approvals where applicable. It also mandates annual performance evaluations to ensure transparency and accountability.

The NRC is empowered to issue implementation guidelines and delegate responsibilities for effective execution. The policy is available on the Company's website at: www.rajshreesugars.com/policies

23) Industrial Relations

During the year under review, your Company enjoyed cordial relationship with workers and employees at all levels.

24) Internal control systems and their adequacy

The Company has internal control systems which is commensurate with its size, nature and volume of operations.

25) Rajshree Sugars & Chemicals Limited (RSCL) Employees Stock Option Plan 2012

A detailed report as required under SEBI (Share based Employee Benefits and Sweat Equity) Regulations, 2021 on the "RSCL Employees Stock Option Plan 2012" forms part of this report, as Annexure 4.

26) Secretarial Audit

Pursuant to Section 204 of the Companies Act, 2013 and the rules made thereunder, the Secretarial Audit Report for FY 2024-25, issued by Mr. G. Soundarrajan, Practising Company Secretary, is annexed as Annexure 5. The report contains no qualifications, reservations, or adverse remarks.

27) Annual Return

In terms of Section 92(3) of the Act, read with Companies (Management and Administration) Rules, 2014, The Annual Return of the Company in Form MGT-7 filed for the Financial year ended 31^st March 2024 has been placed on the website of the Company i.e. https://www.rajshreesugars.com/annual-return-mgt-7/.

28) Transfer of Amounts to Investor Education and Protection Fund (IEPF)

In accordance with Section 124(5) of the Companies Act, 2013, no dividend is currently pending for transfer to the Investor Education and Protection Fund (IEPF), except for an unpaid amount of '39,729 for the financial year 2009-10. The transfer of this amount is held in abeyance due to court orders.

As required under the IEPF (Uploading of Information regarding Unpaid and Unclaimed Amounts) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed dividend amounts as on 28^th August 2017 on its website (www.rajshreesugars.com) and on the website of the Ministry of Corporate Affairs.

Additionally, the Company transferred the equity shares of shareholders who had not claimed dividends for seven consecutive years to the credit of the IEPF on 6^th December 2017, via Form IEPF-4. Shareholders may claim such shares and dividends by following the procedure prescribed on the IEPF Authority's website: https://www.iepf.gov.in/IEPF/refund.html

29) Directors' Responsibility Statement

In terms of clause (c) of sub-section (3) of Section 134 of the Act, the Directors state that:

i) in the preparation of the annual accounts / financial statements, the applicable accounting standards have been followed along with the proper explanation relating to material departures; if any.

ii) accounting policies as selected have been applied consistently and the judgments made and estimates were 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 / loss of the Company for the year under review.

iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) the annual accounts / financial statements have been prepared on a going concern basis.

v) internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and operating effectively.

vi) a proper system has been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

30) Code of Conduct

Directors, KMP and SMP of the Company have affirmed adherence to the Code of Conduct pertinent to the Directors and employees of the Company and the declaration in this regard made by Wholetime Director, as required under LODR forms part of CGR.

The code is available in the website of the company www.rajshreesugars.com/Code-of-conduct-fair-disclosure

31) Prevention of Insider Trading

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and Designated Persons of the Company, as per SEBI (Prohibition of Insider Trading) Regulations, 2015.

The code is available in the website of the Company www.rajshreesugars.com/Code-of-conduct-fair-disclosure

32) Risk Management Policy

The Company has formulated a Risk Management Policy as required under LODR. The Company has also formulated a specific policy on 'Forex and Interest Rate Risk Management Policy for Currency and Interest Rate Risk Management'.

The Board perceives the risk of recurring lower sugar recovery in the State of Tamil Nadu as compared to minimum recovery for which sugar mills are to pay the Fair and Remunerative Price. Lower capacity utilization is also a concern.

The Tamil Nadu Industry has also the option of producing Ethanol. The Tamil Nadu Government has issued an Ethanol Blending Policy 2023 to attract investments in molasses/grain-based ethanol programme to make the state self-sufficient in meeting the estimated annual requirement of 130 crore litres. However, the State has the limited scope as availability of molasses is limited.

The details about the risks being faced by the Company are furnished in the 'Management Discussion & Analysis Report' (Annexure 6).

33) Significant & material orders passed by regulator or courts or tribunals impacting going concern status and companies operations in future

There have been no significant and material orders passed by any Regulator / Court / Tribunal impacting the going concern status and company's operations in future.

34) Compliance with Secretarial Standards

The company has complied with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India and approved as such by the Central Government, as per the provisions of the Act.

35) Details of any applications made or proceedings pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year.

The company confirms that no such applications have been made, and there are no proceedings pending.

36) Details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

The Company affirms that no one-time settlement was entered into during the year, except with the Sugar Development Fund (SDF), as detailed above.

37) Acknowledgement

Your Directors thank the Banks and Financial Institutions for their valuable and timely financial assistance and support provided by them to the Company. Your Directors also thank the cane growers, suppliers, Government Institutions and others for the cooperation extended to the Company. The Board also places on record its appreciation of the dedicated services rendered by the employees of the Company.

May Goddess Lakshmi shower her blessings for the continued prosperity of the Company.