Your Directors have immense pleasure in presenting this 47^th Annual Report on the Company's business and operations together with Audited Financial Statements (Standalone and Consolidated) for the Financial Year (FY) ended on 31^st March, 2023.

FINANCIAL RESULTS AND STATE OF THE COMPANY'S AFFAIRS

During the year under review, the Company achieved remarkable performance on operational and financial fronts. The Company established total eighty (80) new Records during the FY 2022-23, out of which forty four (44) Records were established in Production and thirty six (36) for Sale / Dispatch.

The Financial Highlights on Standalone basis are summarized, as follows:

COMPANY'S PERFORMANCE OVERVIEW1.0 Operational Performance:

The Company has achieved remarkable production performance during the FY 2022-23. Day to day Plant Operations were closely reviewed and optimised to maximize profit.

During the year, following Plants achieved over 100% capacity utilization level. Ammonia (6,79,535 MTs i.e. 152.53%), ASGP (3,69,823 MTs i.e. 100.06%), Urea (8,35,863 MTs i.e. 131.24%), Methyl Formate (33,650 MTs i.e. 147.59%), Formic Acid (25,461 MTs i.e. 254.61%), Acetic Acid (1,62,563 MTs i.e. 162.56%), Weak Nitric Acid-I (3,03,248 MTs i.e. 122.52%), Weak Nitric Acid-II (1,28,095 MTs i.e. 128.10%), CNA-III (49,890 MTs i.e. 100%), TDI-I (17,669 MTs i.e. 126.21%), MTD-I (14,436 MTs i.e. 122.30%), Ethyl Acetate (68,658 MTs i.e. 137.32%). During the year, strategic optimization of various Plant Operations and product mix had been done keeping in line with price of raw materials so as to achieve cost reduction in all aspects.

TDI-II Dahej operated for 258 days (on-stream days) during the year with capacity utilization of 74.65%. Yearly production of 37,322 MT has been achieved against target of 58,010 MT, which is lower mainly on account of market constraints, higher input cost amid global geopolitical situation and technical glitches faced in the Plant during the year. Annual shut down of the Plant was taken in July, 2022.

Anxiety was faced in SAC (Sulphuric Acid Concentration) plant as two failures of SA91 storage tank along with exchangers E31803 & E31802 occurred on 30.1 1.2022 and 04.01.2023 respectively, which were successfully overcome by in-house efforts and modifications which averted long shutdown of TDI-II Plant.

2.0 Financial Performance:

Your Directors are happy to share with you the highlights of Annual Financial Results (AFRs) achieved by your Company for the FY 2022-23 on Standalone basis.

The company reported highest ever revenue of ' 10,227 Crores; 18% more than previous highest reported revenue in last financial year which was a year of historic performance.

On the back of strong financials, the Board of Directors at its meeting held on 18^th May, 2023, Chaired by Shri Vipul Mittra, IAS has recommended dividend of 300% which is the highest ever dividend.

SALES1.0 Industrial Products:

The Chemical industry as a whole and our Industrial Products market witnessed trend towards normalisation during the FY 2022-23. In the previous year, most of our products attained historical highest prices. Overall there is slump in demand of various chemicals due to recession like situation particularly in Europe. In spite of such a situation, we could achieve ever highest annual sales for some of our main products. GNFC's products have better resonance due to their application and use in different end use sectors. The sales volume of our top ten industrial products increased by 6% in FY 2022-23 compared to previous year.

2.0 Fertilizer Business:

During the FY 2022-23, your Company has achieved total sales of 6.39 Lakhs Metric Tonnes of Urea which was a little lower than the previous year (i.e. 6.64 Lakh Metric Tonnes). Sales of Nitrophosphate (20-20-0) stood at 1.28 Lakh Metric Tonnes, marginally higher to 1.20 Lakhs Metric Tonnes in the FY 2021-22. Decreased sales volume of Urea was mainly for maintaining production to the levels of re-assessed capacity i.e. 6.37 Lakh Metric Tonnes, to avoid loss in subsidy realization. Nitrophosphate was sold as per the availability. During the FY 2022-23, the Company could increase retail sales of Urea to 94,222 metric Tonnes from 84,355 metric Tonnes of FY 2021-22 through its own Narmada Khedut Sahay Kendras (NKSKs).

During the year, Trading Activities were also continued in Muriate of Potash (MoP), Di-Ammonium Phosphate (DAP), Ammonium Sulphate (AS), Single Super Phosphate (SSP) and City Compost. A total quantity of 31,018 Metric Tonnes of Fertilizers were sold during the FY 2022-23 against 16,824 Metric Tonnes sold in 2021 -22. Besides, GNFC sold non-bulks agri inputs worth ' 97.06 Lakh through NKSKs.

3.0 (n)Code Solutions - IT Division:

During the FY 2022-23, (n)Code Solutions - IT Division of the Company continued to provide IT services such as Digital Signature Certificates, PKI Solutions, e-Procurement and e-Auction services, Smart City/System Integration, Data Centre Operations, software/application development & support etc. Our commitment to innovation, excellence, and customer satisfaction helped us achieve growth in almost every business vertical.

(n)Code Solutions registered a Profit Before Tax (PBT) of ' 36 Crore for the FY 2022-23, an increase of ~50% from the previous year's PBT of ' 24 Crore. Our total sales for the FY 2022-23 were ' 74 Crore compared to the previous year's total sales of ' 73 Crore. (n) Code Solutions successfully managed all business and support activities with full client satisfaction.

(n)Code Solutions has also secured several prestigious projects, including the implementation of e-Passport initiative of the Government of India (GoI); "Ease of Doing Business" initiative for the Central Bureau of Narcotics (Ministry of Finance - Revenue Dept. GoI) to digitize business processes and promote ease of access and prompt service and development and implementation of an online system ('Coal Distribution Management System') for distributing and allocating coal quota received from the Central Govt. for Gujarat Mineral Development Corporation (GMDC).

Looking ahead, our aspiration is to expand our reach across India and bring greater convenience to business through our comprehensive range of software solutions, including innovative products such as e-tender, e-Auction, Digital Solutions, integrated Mining solutions etc. By leveraging the latest digital technology, we are committed to providing our clients with the tools they need to succeed in today's competitive marketplace.

An analysis of the Company's operational, sales and financial performance is presented under a separate section on "Management Discussion & Analysis" forming part of this report.

DIVIDEND:

Keeping in view the Company's performance for the FY 2022-23, long term growth strategy and to ensure that the Shareholders get sustained return on their investment, your Directors have recommended a Dividend of ' 30/- per share (@ 300%) on 15,54,18,783 Equity Shares of 10/- each fully paid up, subject to approval of Shareholders at the Annual General Meeting. On its approval, the Dividend payout will work out to ' 466.26 Crore. This amounts to 31.85% of the Net Profit of the Company.

APPROPRIATIONS:

Your Company has registered a Net Profit of ' 1,463.98 Crore for FY 2022-23. After deducting there from ' 68.79 Crore being the re-measurement loss on defined employee benefit plans and adding thereto ' 4,075.39 Crore being the balance of Statement of Profit & Loss brought forward from previous year, an amount of ' 5,470.58 Crore is available for appropriation. Out of this, ' 155.42 Crore is appropriated towards payment of Dividend of FY 2021 -22 and ' 200 Crore is transferred to General Reserve. The balance amount of ' 5,115.16 Crore is proposed to be carried to Balance Sheet.

TRANSFER TO RESERVES:

The Board of Directors has decided to transfer ' 500 Crore of profits of FY 2022-23 to General Reserve.

FERTILIZER INDUSTRY - GOVERNMENT POLICY:

Government Policy in respect of fertilizers pricing has not underwent any change during the FY 2022-23. However, Government has come up with following new directives aiming towards reforms.

Introduction of 'One Nation One Fertilizer (ONOF)' in all fertilizers. After deliberations and discussions with the Industry, ONOF has been implemented in all fertilizers including Urea, DAP, MOP and NPK. It has begun with imported urea on 02.10.2022, indigenous Urea on 01.12.2022, DAP & NPK on 01.01.2023.

Dept. of Fertilizers (DoF) has started giving movement plans of Urea and other non-Urea fertilizers through a linear programme of RITES (Rail India Technical & Economic Service Limited). The objective is to avoid crisscross movement of fertilizers thereby saving primary freight cost.

As an another step, GoI has introduced 'Pradhan Mantri Krishi Samraddhi Kendra' (PMKSK), which is being implemented across the country. All the fertilizers companies, including GNFC have been allotted 3.30 Lakh retails shops in India to convert as PMKSKs. The Govt. is looking to develop the retail shops as primary destination for advisory to the farmers besides offering agri services and all agri inputs under one roof.

Nutrient Based Subsidy (NBS) was announced on six monthly basis during 2022-23. For GNFC's Nitrophosphate the NBS Subsidy was ' 32,940 per Metric Tonnes in first half and ' 32,991 per Metric Tonnes during second half of the year.

On-Going Projects / New Projects/ Revamp Schemes:

Your Company is continuously looking for the growth opportunities and has initiated actions for implementation of various projects / Revamp Schemes as follows:

1. Formic Acid Capacity Enhancement:

GNFC implemented Formic Acid (FA) capacity enhancement Project to increase the capacity by 20 MTPD (6,800 MT per annum). Project commissioned in April, 2022 & required designed capacity achieved in June, 2022.

2. Concentrated Nitric Acid (CNA) - IV Plant:

With the increase in captive consumption of CNA for TDI, market share of the Company is reducing. Hence, the Company has successfully commissioned CNA-IV expansion Project with a capacity of 150 MTPD, in July, 2023.

3. 04 MW Solar Power Plant Project:

To fulfil Renewable Purchase Obligation (RPO), your Company is implementing four 04 MW Solar Power Project at Charanka Solar Park. The Project will be completed by First Quarter of FY 2023-24.

4. Ammonia Plant revamp

At present, your Company is producing about 1,950 MTPD Ammonia from both fuel oil and natural gas route after installation of S-300 revamp. It is planned to increase the Ammonia production capacity from 1,950 MTPD to 2,100 MTPD by installation of Ammonia Make-up Gas Convertor Loop [AMUGL], in existing Ammonia Synthesis Loop (ASL). The Project will also increase the reliability of existing ASL.

This will increase Ammonia production by 50,000 MT per annum which will be consumed for new Weak Nitric Acid and Ammonium Nitrate Plants. Agreement has been signed with M/s. Haldor Topsoe, Denmark, the Technology Licensor, to implement the Project in EPC mode.

5. Coal based Captive Co-generation Power Plant at Dahej:

The Company has set up 100 MT/Hr. capacity gas based Boiler at TDI - II Dahej Complex to meet captive steam requirement, while power is being sourced from DGVCL Grid. There is large variation in gas prices.

Approval from the Board of Directors for implementation of Coal based Captive Co-Generation Power Plant (CCPP) Project having a capacity to produce 18 MW Power and 150 MT/ Hr. Steam was availed in October, 2022, in order to reduce cost of steam and Power and to improve reliability of TDI-II Dahej Plant. LSTK Contract has been awarded to M/s Thyssenkrupp Industries India Pvt. Ltd., in October, 2022. The Project is expected to be completed by April, 2025.

6. Weak Nitric Acid-III (WNA-III) and Ammonium Nitrate-II (AN-II) Project:

Your Company is planning to expand its capacity of WNA and AN considering future market growth. Two separate NITs for WNA-III with capacity of 600 MTPD and AN-II with capacity of 480 MTPD have been floated. After consumption of WNA in

AN-II, surplus WNA will be sold out in the domestic market. AN-II will have facility to produce both Low Density Ammonium Nitrate (LDAN) and High Density Ammonium Nitrate (HDAN), being used mainly in explosives manufacturing.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of Sections 134(3)(c) read with 134(5) of the Companies Act, 2013, your Directors confirm that—

(i) in the preparation of Annual Accounts for the financial year ended 31^st March, 2023, the applicable Accounting Standards had been followed along with proper explanation relating to material departures, if any;

(ii) they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at end of the financial year on 31^st March, 2023 and of the profit of the Company for that period;

(iii) they had 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, if any;

(iv) they had prepared Annual Accounts on a going concern basis;

(v) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

(vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of financial year of the Company to which the Financial Statements relate and the date of the Report.

DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:

The Company has Associate Company viz. Gujarat Green Revolution Co. Ltd. (GGRCL). The Statements containing salient features of Financial Statements are given in Form AOC-1 as Annexures to the Consolidated Financial Statements and the same have not been repeated here for the sake of brevity.

CONSOLIDATED FINANCIAL STATEMENTS:

Pursuant to Section 129(3) of the Act, read with Regulation 33 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 [the SEBI Listing Regulations, 2015], as amended, the Company has prepared Consolidated Financial Statements in respect of Associate Company GGRCL for the FY 2022-23 and forms part of this Annual Report.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:

The Company has not made any investment in other bodies corporate or given any Loan or Guarantee or provided any Security in connection with loan to any other body corporate or person during the FY 2022-23.

PARTICULARS OF CONTRACT OR ARRANGEMENT MADE WITH RELATED PARTY:

The Policy for Related Party Transactions (RPTs) deals with review and approval of RPTs and the same is available on the Company's Website at web link https://www.gnfc.in/wp-content/uploads/2021/04/Related-Party-Transactions-Policy.pdf. The Audit Committee has granted Omnibus approval for RPTs, which are routine and repetitive in nature, based on the criteria approved by the Board of Directors within the overall framework of the said Policy. All RPTs under the Omnibus approval are placed before the Audit Committee periodically for its review and approval.

The Company has not entered into any contract or arrangement with related parties, as referred to in Section 188(1) of the Act during the FY 2022-23. Hence, the disclosure of RPTs in Form AOC-2, as required under Section 134(3)(h) of the Act, is not applicable to your Company. Details of Related Party as per Ind AS-24 are given in Note No. 37 to the Standalone Financial Statements.

Requisite details on RPTs have also been furnished in the 'Report on Corporate Governance' forming part of this Report. MEETINGS OF THE BOARD AND COMMITTEES THEREOF:

(i) Board Meeting:

Five (5) Meetings of the Board of Directors were held during the year.

(ii) Committees of the Board:

Presently, there are seven Committees of the Board as follows:

1. Audit Committee (AC);

2. Stakeholders' Relationship Committee (SRC);

3. Nomination and Remuneration Committee (NRC);

4. Corporate Social Responsibility (CSR) Committee;

5. Risk Management Committee (RMC);

6. Project Committee (PC); and;

7. Human Resource Development Committee (HRDC).

Details of composition of the Board and its Committees, which are mandatorily required to be constituted, major Terms of Reference of these Committees, Meetings held during the year and attendance of Directors at such Meetings are furnished in the 'Report on Corporate Governance' forming part of this Report.

All the recommendations made by the Audit Committee were accepted by the Board.

REMUNERATION POLICY FOR DIRECTORS / KEY MANAGERIAL PERSONNEL / SENIOR MANAGEMENT AND OTHER EMPLOYEES:

The Company has formulated a Nomination, Remuneration & Evaluation Policy as required under Section 178 of the Act and SEBI (LODR) Regulations, 2015 and the same is available on the Company's website at web link https://www.gnfc.in/wp-content/uploads/2021/04/GNFC-NRC-Policy_11815.pdf. The details of remuneration paid to Directors / Key Managerial Personnel / Senior Management and other employees are furnished in the Report on Corporate Governance, forming part of this Report.

PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS:

The Company has carried out annual performance evaluation of the Board, its Committees and Individual Directors in line with the provisions of the Act and the SEBI Listing Regulations, 2015, as amended.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNELChairman of the Company:

Shri Vipul Mittra, IAS, was nominated and appointed as Chairman of the Company by the Govt. of Gujarat (GoG), w.e.f. 31.01.2023.

Retirement of Director(s) by Rotation:

In terms of Section 152 of the Act, Shri Mukesh Puri, IAS will retire by rotation at this AGM and being eligible, offers himself for re-appointment.

Declaration by Independent Directors:

In terms of Section 149(7) of the Act and the SEBI Listing Regulations, 2015, the Company has received necessary Declarations for the FY 2023-24, from all Independent Directors, to the effect that they meet with the criteria of independence as laid down in Section 149(6) of the Act and Regulation 16(1) (b) of the SEBI Listing Regulations, 2015, as amended.

Change in Directorate:

The information relating to change in Directorate during the year is furnished in the 'Report on Corporate Governance' forming part of this Report.

Your Directors place on record their deep sense of appreciation for the valuable services rendered by the outgoing Director(s) and take this opportunity to welcome the incoming Director(s).

INVESTOR EDUCATION AND PROTECTION FUND (IEPF):

The IEPF Rules, mandate Companies to transfer Shares of Members whose Dividends remain unpaid / unclaimed for a continuous period of seven years to the Demat account of the IEPF Authority. The Sahreholders whose Dividend / Shares are transferred to the IEPF Authority can claim their shares / dividend from the Authority.

In terms of the provisions of IEPF Rules / Investor Education and Protection Fund (Awareness and Protection of Investors) Rules, 2001, the Company did not pay any Dividend for the FY 2014-15, thus there was no Unpaid/ Unclaimed Dividend and no Shares were liable to be transferred to IEPF during the FY 2022-23.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

Requisite details have been furnished in "Report on Corporate Governance" forming part of this Report.

RISK MANAGEMENT AND INTERNAL CONTROL SYSTEM AND ITS ADEQUACY:

The Company has in place Risk Management Policy (RMP). Under this Policy, various risks pertaining to Operations & Maintenance of the Plants, financial and other organizational risks are assessed, evaluated and continuously monitored for taking effective steps for its mitigation.

In compliance with Regulation 21 of the SEBI Listing (Amendment) Regulations, 2018, the Board of Directors has constituted a Risk Management Committee (RMC) defining its Terms of Reference (ToR), in its Meeting held on 11th February, 2019. The details as to the constitution of RMC and its major ToR included in the "Report on Corporate Governance" are forming part of this Report.

The Risk Management Report, inter-alia, containing major anxiety areas of risks and action plan for its mitigation and noteworthy risk management activities carried out by the Company is put up before the Meetings of the Audit Committee, RMC and the Board of Directors for its review.

The Company has adequate internal controls commensurate with the nature of business, size and complexity of its Operations. Details of internal control system and its adequacy are furnished in "Management Discussion & Analysis Report", forming part of this Report.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3) (a) of the Act, the Draft Annual Return in Form MGT-7 as on March 31,2023 is available on the Company's website at https://www.gnfc.in/statistics-annual-report/#1661838618831 -f3392cb8-b234

CORPORATE SOCIAL RESPONSIBILITY (CSR):

In accordance with the requirements of Section 135 of the Act, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company has constituted a Corporate Social Responsibility (CSR) Committee and formulated a CSR Policy. As a responsible corporate, the Company has been undertaking societal activities / projects directly as well as through its CSR arm - Narmadanagar Rural Development Society (NARDES) in the major areas which are covered in the CSR Policy and Schedule-VII to the Act.

The Company's CSR Policy is available on the Website of the Company at web link https://www.gnfc.in/wp-content/uploads/ 2021/04/CSR-Policy-Revised_17-05-2021.PDF

As per the provisions of Section 135 of the Act, the statutory amount (i.e. 2% of the average net profits of the last three Financial Years) that was required to be spent by the Company for various CSR Activities/Projects, during the FY 2022-23, was ' 24.20 Crore. The Company had actually spent ' 24.27 Crore towards various CSR Activities/Projects during the FY 2022-23. During the FY 2022-23, no amount (being excess spending of previous FY) was available for set off in pursuance of sub-rule (3) of rule 7 of the Companies (Corporate Social Responsibility Policy) Rules, 2014.

Pursuant to Rule 12 of Companies (Accounts) Rules, 2014, the Company has filed statutory Form CSR-2 for FY 2021-22 on 28.03.2023.

Annual Report on CSR activities as required under Rule 9 of the Companies (Accounts) Rules, 2014 read with Rule 8 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed as Annexure - A to this Report.

VIGIL MECHANISM-CUM-WHISTLE BLOWER POLICY:

The Company has formulated a "Vigil Mechanism-cum-Whistle Blower Policy" for its Directors and Employees to report their genuine concerns, details of which have been furnished in the "Report on Corporate Governance", forming part of this Report.

SIGNIFICANT AND MATERIAL ORDERS:

There are no significant or material Orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its Operations in future.

MANAGEMENT DISCUSSION & ANALYSIS AND REPORT ON CORPORATE GOVERNANCE:

"Management Discussion & Analysis" on the business and operations of the Company and the Report on Corporate Governance together with the followings are attached herewith and form part of this Annual Report.

• Declaration by Managing Director regarding compliance of the Company's Code of Conduct by the Board Members and Senior Management Personnel.

• Certificate by Practicing Company Secretary certifying:

(i) compliance of the conditions of Corporate Governance by the Company; and

(ii) that none of the Directors of the Company have been debarred or disqualified from being appointed or continuing as Directors of Companies by the Securities and Exchange Board of India / Ministry of Corporate Affairs or any such Statutory Authority.

BUSINESS REPONSIBILITY AND SUSTAINABILITY REPORT:

Business Responsibility and Sustainability Report (BRSR) is based on Environment, Social and Governance (ESG) norms and Sustainable Development Goals. Your Company has strived to actualize the principles of responsible business conduct in letter and spirit and is conducting its Business in a manner that creates shared values for all Stakeholders whilst aiming to achieve the best targets on ESG fronts.

Your Company has adopted to report under the new reporting guidelines prescribed by the SEBI for FY 2022-23. The report is appended as Annexure - B, forming part of this Report.

INFORMATION REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

As required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, requisite information on conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is furnished in the enclosed Annexure - C, forming part of this Report.

PARTICULARS OF EMPLOYEES AND REMUNERATION:

There were 2,273 permanent employees of the Company as of 31st March, 2023. The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (the 'Rules') have been appended as Annexure - D, forming part of this Report. Details of employee remuneration as required under the provisions of Section 197 of the Act and Rule 5(2) and 5(3) of the Rules are available to any Shareholder for inspection on request. If any Shareholder is interested in obtaining a copy thereof, such Shareholder may write to the Company Secretary, where upon a copy would be sent through email only.

AUDITORS AND AUDITORS' REPORT:

Pursuant to the provisions of Section 139 and other applicable provisions of the Act and relevant Rules made there under, the Shareholders of the Company had at their 45th AGM held on 23rd September, 2021 appointed M/s Suresh Surana & Associates LLP, Mumbai, Chartered Accountants, a Member firm of RSM International as Statutory Auditors of the Company for a term of Five (5) consecutive years, until conclusion of the forthcoming 50th AGM to be held in the year 2026, on such remuneration as may be determined by the Board of Directors, based on the recommendation of the Audit Committee plus certification fees, applicable taxes and reasonable out of pocket expenses actually incurred by them during the course of Audit.

Notes to Financial Statements (Standalone and Consolidated) forming part of Audited Financial Statements for FY 2022-23 are self- explanatory and need no further explanation. The Auditors' Reports on Audited Financial Statements (Standalone and Consolidated) does not contain any Modified Opinions.

COST AUDITOR:

As per Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to prepare, maintain as well as have the audit of its cost records conducted by a Cost Accountant and accordingly, it has made and maintained such cost accounts and records. The Board of Directors, on the recommendation of the Audit Committee, has appointed Mr. R K Patel, Proprietor of M/s R K Patel, Vadodara, having FRN No. 100180 as the Cost Auditor of the Company for the FY 2023-24 at a remuneration of ' 1,00,000/- (' One Lakh) p.a. plus out of pocket expenses and statutory levies.

Mr. R K Patel, Proprietor of M/s R K Patel, Vadodara, have confirmed that they are free from disqualification specified under Section 141 (3) and proviso to Section 148(3) read with Section 141 (4) of the Act and that the appointment meets the requirements of the Act. They have further confirmed their independent status and an arm's length relationship with the Company.

The remuneration payable to the Cost Auditor is required to be placed before the Shareholders in General Meeting for ratification. Accordingly, a resolution seeking Shareholders' ratification for the remuneration payable to Mr. R K Patel, Proprietor of M/s R K Patel, Vadodara, forms part of the Notice of 47^th AGM, forming part of this Annual Report.

The Company had e-filed the Cost Audit Report for the FY 2021-22 with the Ministry of Corporate Affairs (Cost Audit Branch), on 06^th September, 2022. The due date of filing the said Report was 27^th September, 2022.

SECRETARIAL AUDITOR:

In pursuance of Section 204 of the Act and the Rules made thereunder, the Board of Directors, in its Meeting held on 04^th February, 2021, appointed CS Shalin Patel, Practicing Company Secretary, Vadodara as Secretarial Auditor for three years

from FY 2020-21 to FY 2022-23. Due to some circumstances, he could not continue his term up to FY 2022-23 as Secretarial Auditor of the Company. In order to fill the vacancy, the Board of Directors, in its meeting held on 10^th November, 2022 appointed CS J.J. Gandhi, Practicing Company Secretary of M/s. J. J. Gandhi & Co., Vadodara, as Secretarial Auditor for the FY 2022-23. The Secretarial Audit Report in Form MR-3 in respect of Secretarial Audit work carried out by him for the FY 2022-23 is enclosed at Annexure - E, forming part of this Report. The said Report does not contain any qualification, reservation or adverse remark.

DIVIDEND DISTRIBUTION POLICY:

As per Regulation 43A of the SEBI Listing Regulations, 2015, Dividend Distribution Policy of the Company inter-alia, set-out the various parameters and circumstances that are to be taken into account while determining the distribution of Dividend to the Shareholders and / or retaining profits by the Company. The said Policy is enclosed at Annexure - F, forming part of this Report and the same is also available on the Company's website at web link https://www.gnfc.in/wp-content/uploads/2021/04/Dividend-Distribution-Policy.pdf

DISCLOSURE ON COMPLIANCE OF SECRETARIAL STANDARDS:

The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI), New Delhi, and approved by the Central Government.

DETAILS OF FRAUDS, IF ANY, REPORTED BY THE AUDITORS:

During the year, there was no fraud reported by Auditors under Section 143(12) of the Act.

FIXED DEPOSITS:

The Company has not invited or accepted any Fixed Deposit during the year.

INSURANCE:

The properties, insurable assets and interest of the Company such as Buildings, Plant & Machinery and Stocks, amongst others, are adequately insured. As required under the Public Liability Insurance Act, 1991, the Company has also taken necessary insurance cover

INDUSTRIAL RELATIONS:

The Industrial Relations within the Company remained cordial and harmonious throughout the year It has helped the Company to achieve satisfactory performance on Operational and Financial fronts and in achieving targets.

Your Directors place on record their sincere appreciation for the dedicated and committed contributions made by all employees at all levels for the sustainable growth of the Company.

ACKNOWLEDGEMENTS:

The Board of Directors wish to place on record their deep sense of gratitude for the kind support and guidance received from the Government of India and the Government of Gujarat. Your Directors also take this opportunity of extending their wholehearted thanks to all our Consumers, Dealers, Customers, Banks, Business Associates, SEBI, NSDL, CDSL, Stock Exchanges and other Agencies for their continued support and co-operation and valued Investors for strengthening their bond with the Company.

For and on behalf of the Board of Directors,Shri Vipul Mittra, IAS

Chairman

Place: Gandhinagar DIN: 03108280

Date: 29^th July, 2023