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You can view full text of the latest Director's Report for the company.

BSE: 508814ISIN: INE757A01017INDUSTRY: Packaging & Containers

BSE   ` 499.40   Open: 503.60   Today's Range 494.05
519.45
+0.10 (+ 0.02 %) Prev Close: 499.30 52 Week Range 451.45
771.20
Year End :2022-03 

Your Directors are pleased to present their 45th Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31st March, 2022.

1. Summary Financial Results

The Financial Results of the Company for the year ended 31st March, 2022

, were as follows:

(' in Cr)

Particulars

Standalone

Consolidated

Year Ended

Year Ended

Year Ended

Year Ended

31st March 2022

31st March 2021

31st March 2022

31st March 2021

Net Sales

2,824

2,083

3,038

2,285

Other Income

46

36

48

38

Profit before Interest, Depreciation and Tax

526

398

620

430

Finance Cost

37

40

40

42

Depreciation

58

53

63

59

Profit before Tax

430

305

517

329

Provision for Taxation

- Current Tax

75

53

80

56

- Deferred Tax

42

36

40

36

Profit After Tax

313

216

397

237

Earnings per Equity Share

Basic

174.81

115.57

221.56

127.02

Diluted

171.21

114.39

216.99

125.72

Appropriations:

Dividend-Equity Shares

64

45

64

45

margins due to balanced demand and supply scenario and operational efficiency.

As on 31st March, 2022, Return on Capital employed stands at 29% and Return on Equity is 39%.

In coming years, B2B segments (focus towards growing speciality sales, specialized BOPET line, world's largest BOPP and CPP lines) and B2C segments (D2C Petcare and specific speciality chemicals) will drive growth.

The Indian Packaging industry, which is one of the largest globally, is expected to register a CAGR of 27% during 2022-2027(1). The flexible packaging market in India is expected to grow at a CAGR of almost 11% during 2021-20251

To tap this opportunity, Company invested in specialized BOPET line likely to be commissioned in FY 2023 and a CPP line, BOPP line expected to be commissioned in FY 2025.

The Company launched several new products during the financial year including Antimicrobial Thermal Lamination Film, Enhanced Barrier Metalized BOPP Film, High Gloss Metalized Label Film, Direct Thermal Printable Film, High Scratch Resistant Metalized Film, Laser Printable (Dry Toner) both side Coated White Synthetic Paper, and 100% Opaque Synthetic Paper.

The Company's focus shall continue to be on improving speciality films, R&D efforts particularly on sustainability which would yield results in coming years. These actions would continue to de-commoditize business model and would contribute in long term sustainable growth. Some of the new growth areas in speciality films being worked on include-

1. Synthetic Paper - Durable alternate to paper. Global 100 Thousand MT market (India 6 Thousand MT) - immense potential to grow,

2. Sustainable solutions,

3. Direct Thermal Printable Film (Cosmo is the first BOPP film producer to launch this film),

4. Sustainable PVC free solutions for graphic applications and

5. Shrink Label film

6. Heat Reduction film.

The speciality films sales have grown YoY in the last 3 years with 18% growth rate. The Company’s speciality films sales stand at 70% during FY22. We are in process of ordering several other value add assets for further growth in the speciality sales and are looking for 80% run rate target from speciality by end of FY23.

Company is currently having six registered patents; seven in pipeline and another seven are being applied.

India's pet care market is expected to grow at a value of ' 7,500 Crores by the end of the forecasted period (2021-2026), on account of rising nuclear families, double-income households, and change in lifestyle, urbanization, and increasing pet ownership (3) There are no large scale organized players in India offering end to end comprehensive solution to the customers. The Industry size, low penetration and high potential for growth provides a clear business opportunity. The Company launched Pet care with simultaneous launch of website, first mobile van and first experience center (retail store) during FY22 under the brand name Apart from being a retail outlet for goods and services, it provided vet consultation, diagnostic lab facilities and cafeteria. Facilities had also been built for imparting training to service providers. E-commerce website had been launched. Mobile app was being developed and expected to be launched soon. With this our offerings would be omni-channel. Product offering through stores and e-commerce also included designer clothing line for Pets under private label Beboji. For pet care the focus would be on scale-up and demerging the business vertical in medium term to drive shareholders' valuation.

In the Speciality Chemicals - Textile Applications & Adhesive segment we plan to cater to niche speciality focused either to address current problem area for the Industry or significantly better product compared to currently available. The way forward is 20% revenue with 25% ROCE in about 5 years. The performance of Speciality Chemicals business is captured in detail under the head ‘Details of Subsidiaries' of this report.

To sum up, in the coming years the Company growth will be driven by specialized polyester line (commissioning in FY 2023) and new BOPP line (commissioning in FY 2025), continuing focus on speciality sales and diversification into speciality chemicals and Petcare business

3. Sustainability

The Company is aggressively working on several sustainability projects including but not limited to:

• Offer mono-material poly-olefin films for ease of recycling,

• Designed heat resistant BOPP films replacing BOPET; mostly used in print layer, giving last push to creation of mono-material structures,

• Company has been partnering with some of the best global brands to offer structure rationalization for some time now,

• Both BOPP and CPP films offer better yield, hence enabling reduced consumption of plastics,

• Offer a suitable substitute for aluminum foil in form of its Ultra-High Barrier Films,

• Offer Oxo-Biodegradable Films,

• Use of Water Based Coatings,

• Reutilization of reprocessed granules from waste material as input for film production,

• Continuous efforts to reduce water usage, waste generation and GHG emissions,

• Constant monitoring of parameters like noise, illumination, ventilation, air quality etc,

• Rain water harvesting and reuse of effluent treated water,

• All plants have partially shifted to the use of solar and wind power as a source of energy for all electrical purposes.

These steps will not only contribute to the environment but will also rationalize costs in coming quarters.

4. Exports

The Company continues to strengthen its exports through brand visibility initiatives taken during the year. Exports during the year increased to ' 1,292 Crores from ' 874 Crores in financial year 2021.

5. Details of Subsidiaries

The Company has nine subsidiaries including step down subsidiaries. Pursuant to Section 129(3) of the Companies Act, 2013 and Accounting Standards issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the Financial Statements of its Subsidiaries.

Consolidated Financial Statements form part of this Annual Report. Statement containing the salient feature of the financial statement of the Company's subsidiaries in Form AOC-1, is enclosed to this Annual Report.

In terms of provisions of Section 136 of the Companies Act, 2013, the Company place separate audited accounts of the Subsidiary Companies on its website at www.cosmsofilms.com.

The subsidiaries of Cosmo Films Limited as on 31st March, 2022 are listed hereunder:

• CF (Netherlands) Holdings Limited B.V.

• Cosmo Films Japan, GK

• Cosmo Films Singapore Pte Limited

• Cosmo Films Korea Limited

• Cosmo Films Inc.

• CF Investment Holding Private (Thailand) Company Limited

• Cosmo Films Poland SP. Z.O.O.

• Cosmo Speciality Chemicals Private Limited

• Cosmo Speciality Polymers Private Limited*

*Incorporated as wholly-owned subsidiary on 29h June, 2021

Operational Performance of Subsidiaries has improved significantly during financial year 2022 which is getting reflected in consolidated EBITDA. Subsidiary’s EBITDA stood at ' 94 Crores against EBITDA at ' 32 Crores last year.

Growth in operational subsidiaries shall be key focus area for the Company in financial year 2023.

The vision behind establishing Cosmo Speciality Chemicals Private Limited was acquiring textile

auxiliary market in India and abroad by providing the most competitive quality products through innovations based on sustainable science. Its operational highlights are as follows:-

Textile Chemicals business which started commercial production in Q2 FY22 has taken off well. Within the first three months, the Company has commercialized 56 products and has started supplies to 40 customers. The Company continues to conduct extensive trials with the customers and expects to add many more customers in the coming month.

• New R&D laboratories are operational for Textile and Adhesive developmental work. The Company's R&D has successfully completed the development of 20 other textile chemical products, each with specific USPs. Some recently developed products include low temperature soaping agent, soft fill silicon, eco clay - environment friendly wetting agent etc. The Company plans to further enhance R&D capability.

• Masterbatch production unit is fully operational and has successfully produced various master batches for in-house and external customers. Its consumption is growing continuously. Some recently developed masterbatches include white masterbatch, anti-stat (with 30% concentration), master batch for blown films etc.

• Adhesive line had been delayed due to delay in government approvals (mainly covid disruptions). Company will start test marketing soon based on products sourced on job work basis.

6. Share Capital

During the year under review, there was no change in the Company's issued, subscribed and paid-up equity share capital. On 31st March, 2022, it stood at ' 18.17 Cr divided into 18,17,27,150 equity shares of ' 10/- each.

7. Reserve

The Company has not transferred any amount to Reserve during the Year.

8. Dividend

During the year, the Board of Directors declared total dividend of ' 35/- (350%) per Equity share of ' 10/-

each. First Interim Dividend of ' 25/- (250%) and Second Interim Dividend of ' 10/- (100%) declared on 16th September, 2021 and 25th January, 2022 respectively which has been paid.

The first and the second Interim Dividend so declared is the Dividend on the Equity Shares of the Company for the Financial Year ended 31st March, 2022.

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) the Dividend Distribution Policy is available on the Company's website at https://www.cosmofilms.com/policies

9. Research and Development (R&D)

The Company takes pride in its continuous research and development which focus on providing innovative solutions as opposed to simply producing commodity films. With these consistent efforts in research and development activities, Cosmo is well placed to benefit from accelerated growth and drive new product development globally. During the year under review, your Company incurred expenditure on Research and Development (R&D) of ' 14.30 Cr as compared to ' 7.60 Cr for financial year 2021.

R&D few focus areas include—:

Films Business-

• Established in house coating manufacturing facility with a capacity of 2400 MT per year;

• 5 new coatings started;

• Launched a heat resistant BOPP based film called TeploR, to replace BOPET films;

• The identification of technical (product/ applications) growth areas through customer activities, exhibitions, publications and technical interactions;

• Increasing the occupancy of value adds in the product baskets;

• Efforts towards down gauging in products;

• Reducing consumption of raw materials & fuel thereby reducing the carbon footprint;

• Support water based printing and complete replacement of solvent based coatings with water based coatings.


Master Batches

• Established 11 new in house master batches for BOPP and CPP Applications including speciality additive master batches and matte compound.

• Established 3 master batches for customers in blown film and for extrusion coating applications.

Textile Chemicals

• Launched 56 new products for the pretreatment, dyeing and finishing processes for textiles.

• Most of the products are GOTS and ZDHC certified and catering to all small scale to corporate textile manufacturers.

10. Capital Expenditure

Your Company has four state of the art manufacturing facilities spread across India (3) and Korea (1), with a total installed capacity of 196,000 MT per annum of BOPP films, 40,000 MT per annum of Thermal Lamination Films, 22,000 MT per annum of Metalized Films, 20,000 MT per annum of Coated Films and 10,000 MT per annum of CPP Films. During the year under review, your Company incurred capital expenditure of ' 282.97 Cr as compared to ' 74.57 Cr for Financial Year 2021.

The capital expenditure incurred during Financial Year 21-22 shall facilitate enhanced sale of speciality films, sustainability initiatives and solar power as a source of energy.

11. Corporate Governance

Cosmo is committed to maintaining best standards of Corporate Governance and has always tried to build the maximum trust with shareholders, employees, customers, suppliers and other stakeholders.

A separate section on Corporate Governance forming part of the Directors' Report and the certificate from the Practicing Company Secretary confirming compliance of the Corporate Governance norms as stipulated in the Listing Regulations is included in the Annual Report in Annexure - A.

12. Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company's

policies, safeguarding of its assets, prevention and detection of fraud, error reporting mechanisms, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures.

The Internal Financial control is supplemented by an extensive program of internal audit conducted by in house trained personnel and external firm of Chartered Accountants appointed on recommendation of the Audit Committee and the Board. The audit observations and corrective action, if any, taken thereon are periodically reviewed by the Audit committee to ensure effectiveness of the Internal Financial Control System. The internal financial control is designed to ensure that the financial and other records are reliable for preparing financial statements and other data, and for maintaining accountability of persons.

13. Risk Management

Cosmo has a robust process in place to identify key risks across the organisation and prioritise relevant action plans to mitigate these risks. The Company has constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) approving the Company's Risk Management Framework and (b) Overseeing all the risks that the organization faces such as strategic, financial, liquidity, security, regulatory, legal, reputational and other risks that have been identified and assessed to ensure that there is a sound Risk Management Policy in place to address such concerns / risks. The Risk Management process covers risk identification, assessment, analysis and mitigation. Incorporating sustainability in the process also helps to align potential exposures with the risk appetite and highlight risks associated with chosen strategies

The risk management procedure is reviewed by the Audit Committee and Board of Directors on regular basis at the time of review of quarterly financial results of the Company. The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis.

A report on the various risks that may pose challenge to your Company are set out as a part of Management, Discussion and Analysis section of this report. Details of the composition of the Risk Management Committee, Meetings held, attendance

of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

14. Vigil Mechanism / Whistle Blower Policy

The Company has adopted a Whistle Blower Policy establishing vigil mechanism, to provide a formal mechanism for the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct or ethics policy without fear of reprisal. The policy is accessible on the Company's website at www.cosmofilms.com.

15. Diversity of the Board

The Company believes that diversity is important to the work culture at any organisation. In particular, a diverse Board, among others, will enhance the quality of decisions by utilizing different skills, qualifications and professional experience for achieving sustainable and balanced development.

16. Directors

(a) Chairman

Mr. Ashok Jaipuria, is the Chairman & Managing Director of the Company.

(b) Appointment and Re-appointment- Other Directors

Mr. A. K. Jain, Executive Director retires by rotation and being eligible offer himself for reappointment at the ensuing Annual General Meeting.

Mr. Arjun Singh has been appointed as Additional Director under the category of Independent Director w.e.f. 27th October, 2021 for a period of 5 years subject to the approval of shareholders at the 45th Annual General Meeting

The details of the proposed appointment/ reappointment of Directors are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of 45th Annual General Meeting (AGM) of your Company.

(c) Status of Other Directors

Mr. Har Kishanlal Agrawal, is acting as Independent Director of the Company. His present tenure of five years is from 25th July, 2019 to 24th July, 2024.

Mr. Hoshang Noshirwan Sinor, is acting as Independent Director of the Company. His present tenure of five years is from 22nd May, 2020 to 21st May, 2025.

Ms. Alpana Parida Shah, is acting as Independent Director of the Company. Her present tenure of five years is from 15th May, 2019 to 14th May, 2024.

Mr. Anil Wadhwa, is acting as Independent Director of the Company. His present tenure of five years is from 23rd May, 2018 to 22nd May 2023.

Mr. Rakesh Nangia, is acting as Independent Director of the Company. His present tenure of five years is from 10th November, 2020 to 9th November, 2025.

Mr. Pratip Chaudhuri, is acting as Non Independent Non Executive Director of the Company. He is covered under the category of director liable to retire by rotation.

(d) Independent Directors Declaration

The Company has received necessary declaration from each Independent Director under section 149(7) of the Companies Act, 2013 that they meet the criteria of independence laid down in section 149(6) of the Companies Act, 2013 and Regulation 16 of Listing Regulations.

17. Statement of Board of Directors

The Board of Directors of the Company are of the opinion that the Independent Directors of the Company appointed/re-appointed during the year possesses integrity, relevant expertise and experience (including the proficiency) required to best serve the interest of the Company. The Independent Directors have confirmed compliance of relevant provisions of Rule 6 of the Companies (Appointments and Qualifications of Directors) Rules, 2014.

18. Key Managerial Personnel

During the year under review, there was no change in KMP of the Company. The following personnel's continue as KMPs as per the definition under Section 2(51) and Section 203 of the Companies Act, 2013:

1. Mr. Ashok Jaipuria, Chairman & Managing Director

2. Mr. A. K. Jain, Director - Corporate Affairs

3. Mr. Pankaj Poddar, Chief Executive Officer

4. Mr. Neeraj Jain, Chief Financial Officer

5. Ms. Jyoti Dixit, Company Secretary

19. Familiarization Programme for the Independent Directors

The Company follows a well-structured induction programme for orientation and training of Directors at the time of their joining so as to provide them with an opportunity to familiarise themselves with the Company, its management, its operations and the industry in which the Company operates.

At the time of appointing a Director, a formal letter of appointment is given to him/her, which inter alia explains the role, function, duties and responsibilities expected of him/her as a Director of the Company. The Director is also explained in detail the Compliance required from him/her under the Companies Act, 2013, the Listing Regulations and other relevant regulations and affirmation taken with respect to the same.

The induction programme includes:

1) For each Director, a one to one discussion with the Chairman and Managing Director to familiarise the former with the Company's operations.

2) An opportunity to interact with the CEO, CFO & Company Secretary, business heads and other senior officials of the Company, who also make presentations to the Board members on a periodical basis, briefing them on the operations of the Company, strategy, risks, new initiatives, etc.

The details of the familiarisation programme may be accessed on the Company's corporate website at www.cosmofilms.com.

20. Remuneration Policy

Your Company is driven by the need to foster a culture of leadership with mutual trust. Cosmo's remuneration policy, which is aligned to this philosophy, is designed to attract, motivate, retain manpower and improve productivity by creating a congenial work environment, encouraging initiative, personal growth and teamwork besides offering appropriate remuneration package. Pursuant to the applicable provisions of the Companies Act, 2013 and the Listing Regulations, the Board, in consultation with its HR, Nomination &

Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors.

Members can download the complete remuneration policy on the Company's website at www.cosmofilms.com.

Disclosure of details of payment of remuneration to Managerial Personnel under Schedule V(C)(6) of Listing Regulations forms part of the Corporate Governance Report.

21. Performance Evaluation of the Board, Committees and Individual Directors

In terms of provisions of Companies Act, 2013 read with the Rules issued thereunder and Listing Regulations, the Board has adopted a formal mechanism for evaluating the performance of its Board, Committees and individual Directors, including the chairman of the Board. Further, a structured performance evaluation exercise was carried out based on criteria such as:

• Board/Committees composition;

• Structure and responsibilities thereof;

• Ethics and Compliance;

• Effectiveness of Board processes;

• Participation and contribution by members;

• Information and functioning;

• Specific Competency and Professional Experience /Expertise;

• Business Commitment & Organisational Leadership;

• Board/Committee culture and dynamics; and

• Degree of fulfilment of key responsibilities, etc.

The performance of Board, Committees thereof, Chairman, Executive and Non-Executive Directors and individual Directors is evaluated by the Board/ Separate meeting of Independent Directors. The results of such evaluation are presented to the Board of Directors.

22. Board and Committee Meetings

During Financial Year 2022, Six (6) meetings of the Board of Directors and Five (5) Audit Committee meetings were held. The intervening gap between the meetings was within the period prescribed under

Details of the composition of the Board and its Committees and of the Meetings held, attendance of the Directors at such Meetings and other relevant details are provided in the Corporate Governance Report.

There have been no instances of non-acceptance of any recommendations of the Audit Committee by the Board during the Financial Year under review.

23. Auditors

(a) Statutory Auditors

M/s. S.N. Dhawan & Co. LLP, Chartered Accountants (ICAI Firm Registration No. 000050N/N500045) were appointed as the statutory auditors of the Company in the 43rd Annual General Meeting held on 7th August, 2020, to hold office for a period of five consecutive years from the conclusion of the 43rd Annual General till the conclusion of the 48th Annual General Meeting to be held in the year 2025. The Statutory Auditors have confirmed they are not disqualified from continuing as Auditors of the Company.

There are no observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report that may call for any explanation from the Directors. Further, the notes to accounts referred to in the Auditor‘s Report are selfexplanatory. During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

(b) Cost Auditors

Mr. Jayant B. Galande, Cost Accountants were appointed as Cost Auditors of the Company for the Financial Year 2023. In accordance with the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, since the remuneration payable to the Cost Auditors is required to be ratified by the shareholders, the Board recommends the same for approval by shareholders at the ensuing AGM.

In terms of the Section 148 of the Companies Act, 2013 (‘the Act') read with Rule 8 of the Companies (Accounts) Rules, 2014, it is stated

that the cost accounts and records are made and maintained by the Company as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.

During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

(c) Secretarial Auditors

The Company had appointed M/s. BLAK & Co., Company Secretaries, New Delhi, to conduct its Secretarial Audit for the Financial Year 2022. The Secretarial Audit report is annexed herewith as Annexure - B to this report. There are no qualifications, reservations or adverse remarks made by Secretarial Auditor in his report. During the year, the Auditor had not reported any matter under Section 143 (12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3) of the Companies Act, 2013.

24. Related Party Transaction

With reference to Section 134(3)(h) of the Companies Act, 2013, all contracts and arrangements with related parties under Section 188(1) of the Companies Act, 2013, entered into by the Company during the Financial Year, were in the ordinary course of business and on an arm's length basis. The details of the related party transactions as required under Accounting Standard are set out in Note 45 to the standalone financial statements forming part of this Annual Report.

As per the Listing Regulations, all related party transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee has been obtained for the transactions which are of unforeseen and repetitive nature. The transactions entered into pursuant to the omnibus approval are presented to the Audit Committee by way of a statement giving details of all related party transactions. The Company has developed a Related Party Transactions Policy for the purpose of identification and monitoring of such transactions and can be accessed on the Company's website at www.cosmofilms.com.

No Material Related Party Transactions (i.e. transactions amounting to ten percent or more of the annual consolidated turnover as per the last

audited financial statements) were entered during the year by your Company except the sale to its wholly owned subsidiary- Cosmo Films Inc. As per Listing Regulations, transactions entered into between a holding company and its wholly owned subsidiary whose accounts are consolidated with such holding company and placed before the shareholders at the general meeting for approval are exempt from obtaining shareholders' approval. The disclosure of Related Party Transactions as required under section 134(3)(h) of the Companies Act, 2013, in Form AoC - 2 is attached as Annexure - C.

25. Management’s Discussion and Analysis Report

Pursuant to regulations 34 of the Listing Regulations, Management's Discussion and Analysis Report for the year is presented in a separate section forming part of the Annual Report.

26. Business Responsibility Report

Pursuant to regulations 34 of the Listing Regulations, Business Responsibility Report for the year is presented in a separate section forming part of the Annual Report.

27. Deposits

The Company has not accepted deposit from the public within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

28. Energy Conservation, Technology Absorption and Foreign Exchange Earnings & Outgo

The details of energy conservation, technology absorption and foreign exchange earnings and outgo as required under Section 134(3) of the Companies Act, 2013, read with the Rule 8 of Companies (Accounts of Companies) Rules, 2014 is annexed herewith as Annexure - D to this report.

29. Particulars of Loans, Guarantees or Investments

The Company have duly complied with the provision of Section 186 of the Companies Act, 2013 during the year under review. The details of loans, guarantees and investments are covered in the notes to the Financial Statements.

30. Significant and Material Orders Passed by the Regulators or Courts

During the year under review, no significant / material orders were passed by the regulators or the Courts

or the Tribunals impacting the going concern status and the Company's operations in future.

31. Change in Nature of Business, if any

There was no change in the nature of business during the year under review.

32. Material Changes and Commitments, if any, Affecting Financial Position of The Company

There were no other material changes / commitments affecting the financial position of the Company or that may require disclosure, between 31st March, 2022 and the date of Board's Report.

33. Listing with Stock Exchanges

The Company confirms that it has paid the Annual Listing Fees for the year Financial Year 2022 to the NSE and the BSE where the Company's equity shares are listed.

34. Annual Return

Pursuant to the provisions of section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company is available on the website of the Company at the link: https://www.cosmofilms.com/notifications-notices

35. Investor Education and Protection Fund (IEPF)

Details of Unclaimed Dividend and Shares transferred to IEPF during Financial Year 2021-22 are given in Corporate Governance Report.

36. Corporate Social Responsibility

As a socially responsible Company, Cosmo is committed to increasing its Corporate Social Responsibility (CSR) impact with an aim of playing a bigger role in sustainable development of our society. In pursuit of this objective, a Corporate Social Responsibility (CSR) Committee had been formed by the Company which oversees and facilitates deliberation on the social and environmental consequences of each of the decisions made by the Board.

The Company has in place a Corporate Social Responsibility Policy pursuant to the provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

The initiatives undertaken by your Company during the year have been detailed in CSR Section of this

Annual Report. The Annual Report on CSR activities in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014, is set out herewith as Annexure - E to this Report.

37. Promotion of Women’s Well Being at Work Place

Cosmo Films has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the said act. There have been no complaints of sexual harassment received during the year.

38. Particulars of Employees And Related Disclosures

The information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is also enclosed as Annexure - F to this Report.

The information pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 pertaining to the top ten employees in terms of remuneration drawn and their other particulars also form part of this report. However, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Companies Act, 2013, the said annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

39. Employee Stock Options

The Company has an Employee Stock Option Plan for the Employees of the Company and its Subsidiaries named as Cosmo Films Shares Based Employee Benefit Scheme, 2021 (“CF SBEB Scheme”). The Plan is in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014 and is administered by the HR, Nomination and Remuneration Committee of the Board constituted by the Company pursuant to the provision of Section

The details of the CF SBEB Scheme form part of the Notes to accounts of the Financial Statements in this Annual Report and also available on our website at www.cosmofilms.com.

40. Director’s Responsibility Statement

Pursuant to the section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of knowledge and belief and according to the information and explanations obtained by them, hereby confirm that:

I. In preparation of the annual accounts, applicable accounting standards have been followed along with proper explanation relating to material departures.

II. Accounting policies selected were applied consistently. Reasonable and prudent judgments and estimates are made so as to give a true and fair view of the state of affairs of the Company as of 31st March, 2022 and of the profits of the Company for the year ended on that date.

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

IV. The annual accounts of the Company have been prepared on a going concern basis.

V. Proper Internal Financial Controls were in place and that the Financial Controls were adequate and were operating effectively.

VI. Systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

41. Awards & Accolades

During the Year, Company has bagged:

• the SIES SOP Star Award under the Packaging Materials & Components for One side printable & other side Barrier coated Face stock Film;

• the SIES SOP Star Awards under the Packaging Materials & Components category for its Liner less Label Films and both side Top Coated Film;

* the IFCA Star Award under the Innovations in Structure category for its CPP Specialized Film;

* the IFCA Star Award under the Innovations category for its Heat Resistant BOPP Film;

* the National Level Scale Award (Exemplary Position) for Supply Chain and Logistics Excellence under Chemicals Category at the CII Conference in Bangalore in 2021.

42. Secretarial Standards

During the Financial year 2022, the Company has complied with applicable Secretarial Standards issued by the Institute of the Company Secretaries of India.

43. Acknowledgement

Your Directors would also like to extend their gratitude for the co-operation received from financial institutions, the Government of India and regulatory

authorities, and the governments of the countries we have operations in. The board places on record its appreciation for the continued support received from customers, vendors, retailers and business partners, which is indispensable in the smooth functioning of Cosmo. Your Directors also take this opportunity to thank all investors and shareholders, and the stock exchanges for their continued support. Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. Their contribution to the success of this organization is immensely valuable.

For and on behalf of the Board of DirectorsAshok Jaipuria Chairman

Date: May 09, 2022 Place: New Delhi

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Overview of Performance

During the financial year 2022, on consolidated basis the Company registered sales of ' 3,038 crores with more than 17% volume growth of speciality sales. Consolidated EBITDA for the year increased by 44% to ' 620 crores against ' 430 crores in financial year 2021 primarily due to higher speciality sales by more than 17%, better BOPP films margins due to balanced demand and supply scenario, operational efficiency and better performance by subsidiaries. Your Company has registered 74% growth in EPS during the year. Company’s net debt has reduced to ' 303 crores from ' 438 crores as on 31st March, 2022 with 0.5 times net debt/EBlTDA ratio.

On Standalone basis, the Company registered sales of ' 2,824 crores with double digit volume growth of speciality sales. Standalone EBITDA for the year increased to ' 526 crores against ' 398 crores in financial year 2021 primarily due to higher speciality sales, better BOPP films