Directors Report of AVT Natural Products Ltd.

Mar 31, 2025

Your directors are pleased to present the Thirty Ninth
Annual Report of the Company together with the Audited
Accounts for the financial year ended March 31, 2025.

FINANCIAL RESULTS

(Rs.in Crores)

Particulars	2024-25	2023-24
Income from Operations	519.22	503.31
Other Income	17.28	12.18
Total Income	536.50	515.50
Profit before tax for the year Less : Provision for taxation	51.76	62.71
Current Tax	12.87	16.50
Deferred Tax	0.83	-0.16
Profit after tax	38.07	46.37
Add : Remeasurement of Post employment benefit obligations through OCI	0.49	-0.13
Add: Surplus brought forward Less: Unrealised Fair Value	156.18	148.65
Gains not available for appropriation	7.23	5.53
Total Amount available for dividend payout Less :	187.50	189.35
Interim Dividend 30% paid on Equity Shares	4.57	4.57
Tax on Interim Dividend	N.A	N.A
Transfer to General Reserve	20.00	25.00
Final Dividend on Equity Shares	7.61	9.14
Tax on Final Dividend	N.A	N.A
Net Amount available for Dividend payout	155.32	150.64
Surplus carried forward to Balance Sheet	162.55	156.18

Proposed dividend on equity shares has not been
recognized as a distribution of profit in the current year’s
accounts in accordance with the Indian Accounting
Standard.

OPERATIONS REVIEW

Total income increased by 4.07% to Rs.536.50 crores in
2024-25 from Rs.515.50 crores. The Profit after Tax for
the year 2024-25 is Rs.38.07 crores (previous year 2023-

24 Rs. 46.37 crores), showing a decrease of 17.91%.
With Fixed Assets of Rs.71.14 crores (previous year
2024-25 Rs.80.41 crores), our Fixed Asset Turnover ratio
is healthy at 7.30 % with Return on Sales stood at 11.13%.

DIVIDEND

Dividend Distribution Policy

Pursuant to Regulation 43A of Listing Regulations, the
Board adopted a Dividend Distribution Policy, which had
been placed on the website of the Company and can be
accessed at the link: https://www.avtnatural.com/policies/

Declaration and payment of dividend

Your Directors are pleased to recommend a final dividend
of Re0.40 per share (40%) with face value of Re.1/- each
on Equity Share Capital, for the year ended 31.03.2025,
amounting to Rs.609.14 Lakhs. During the year, the Board
declared an Interim Dividend of Re.0.30 per share (30%)
with face value of Re.1/- each, amounting to Rs.456.85
Lakhs. The aggregate of dividend declared during the
year was Re.1/-per share (70%) with face value of Re.1/-
each amounting to Rs.1065.99 Lakhs.

TRANSFER TO GENERAL RESERVE

Your directors are pleased to transfer a sum of Rs.20 Crs.
for the year 2024-25 (previous year Rs.25 Crs.) to the
General Reserve.

FINANCE

Cash and bank balances as at 31^st March 2025 was
Rs.530.07 lakhs (previous year Rs.955.42 lakhs). The
Company continues to focus on the judicious management
of its working capital, receivables, inventories and other
financial parameters and which were kept under strict
check through continuous monitoring.

The outstanding term loan from Federal Bank Limited as
on 31^st March 2025 is Rs.4.95 crore, which is given in the
note No.16 to the financial statements.

WINDMILL

The windmill of the Company located at Kokkampalayam
village, Dharapuram Taluk, Erode District, Tamil Nadu
generated 8,30,356 units of electricity in the year
2024-25 against 8,49,811 units generated in 2023-24. The
Company utilised the 7,68,111 units, generated as captive
consumption during 2024-25 for its Sathyamangalam
factory.

BOARD MEETING

The Board of Directors met five times during the financial
year. The details of the Board meeting are given in the

Corporate Governance report. The intervening gap
between the meetings were within the period stipulated
under the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015.

AUDIT COMMITTEE MEETING

The Audit Committee of the Company met four times
during the current financial year. The details of the
Audit Committee meetings are given in the Corporate
Governance report. The intervening gap between the
meetings were within the period stipulated under the
Companies Act, 2013 and SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

PARTICULARS OF LOANS, GUARANTEE, OR
INVESTMENTS

The Company has not given any loans or guarantees
covered under the provisions of section 186 of the
Companies Act, 2013 and Schedule V of the Securities
Exchange Board of India (Listing Obligations and
Disclosure Requirement) Regulations, 2015, except the
''Corporate Guarantee'' given on behalf of its wholly owned
subsidiary companies viz., AVT Natural Europe Limited,
London and to AVT Natural S.A. DE C.V., Mexico, which
is given in the note No.37 to the financial statements.

The details of investments made by the Company are
given in the note No.7 to the financial statements.

LISTING WITH STOCK EXCHANGES

The Company Shares are continued to be listed in both
BSE Limited (BSE) and the National Stock Exchange of
India Limited (NSE). The Company has paid listing fees
up to 31^st March 2025 to both the BSE Limited (BSE) and
the National Stock Exchange of India Limited (NSE).

DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT
SOUTH VAZHAKULAM AND BANGALORE

The approval by the Department of Scientific and Industrial
Research (DSIR), New Delhi for the Company''s R&D
facilities situated at South Vazhakulam, Aluva, Kerala and
the Manchenahaili Village, Kasabe Hobari, Bangalore are
valid upto 31.03.2025. The company has already applied
for renewal with DSIR. The approval is pending till now.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes or events that have
occurred since the date of the Balance Sheet which could
have any effect on the financial position of the Company

DIRECTORS & KEY MANAGERIAL PERSONNEL

During the year, Directors Mr.M.A Alagappan (w.e.f.
24.07.2024) and Mr. P Shankar (w.e.f. 24.07.2024) were
retired from the Directorship due to completion of their
second term of five years as Independent Directors.

Mr.Habib Hussain, Director who was liable to retire by
rotation during the 38^th AGM held on August 09, 2024,
doesn''t offer himself for re-appointment.

Mr.M.M.Venkatachalam and Mr.Ranganath N Krishna
were inducted into the Board as Independent Directors
with effect from July 25, 2024. Mr.Rahul Thomas
was inducted into the Board as Non-Executive Non¬
Independent Director with effect from June 12, 2024.

As on March 31, 2025, the Company has seven Non¬
Executive Directors out of which four are Independent
Directors.

i) Director retiring by rotation

In accordance with the provisions of Companies Act,
2013 and the Articles of Association of the Company,
Mr.Ajit Thomas, Director retires by rotation at the
39^th Annual General Meeting and being eligible, offer
himself for re-appointment.

A resolution seeking shareholders'' approval along
with other required details forms part of the Notice.

ii) Declaration from Independent Directors on
Annual Basis

The Company has received necessary declarations
from all the four Independent Directors of the Company
under Section 149 of the Companies Act, 2013 that the
Independent Directors of the Company meet with the
criteria of their Independence laid down in Section 149
of the Companies Act, 2013 and Regulation 25(8) of
the SEBI (LODR) Regulations 2015.

iii) Key Managerial Personnel

As on March 31, 2025, the following were Key
Managerial Personnel (“KMP”) of the Company as
per Sections 2(51) and 203 of the Act.

• Mr. B Krishna Kumar, President & COO -
Manager (Upto 31.03.2025)

• Mr. A. Ramadas, Sr. Vice President and CFO

• Mr. Sharon Josh, Company Secretary - (Upto
21.07.2024)

• Mr. P Mahadevan, Company Secretary &
Compliance Officer (from 12.11.2024)

During the year under review, the non-executive directors
of the Company had no pecuniary relationship or
transactions with the Company, other than sitting fees,
commission and reimbursement of expenses, if any.

performance of subsidiary/joint venture /

ASSOCIATES

a) AVT Natural SA DE C.V., Mexico (AVTN)

AVT Natural SA DE C.V, Mexico has been
established with an aim to capture market for the
Animal Nutritional products in South American
market and other markets.

The paid-up capital of the Company as on 31^st
March 2025 is Mexican Peso (Mxn) 0.54 million
and there is no change therein since then. AVTN is
the marketing arm of your Company for the animal
nutrition products. The AVTN recorded sales of
Rs.11.93 crores and Loss of Rs.1.85 crores, for the
year 2024-25

b) AVT Natural Europe Limited, UK (AVTNEL)

The paid up capital of the Company as on 31^st March
2025 is Pound Sterling (GBP) 1.535 million and
there is no change therein since then. AVTNEL is the
marketing arm of your Company for de-caffeinated
tea and instant tea. The AVTNEL recorded sales of
Rs.122.18 crores (previous year Rs.108.62 crores)
and profit of Rs.2.58 crores (previous year Rs.3.85
crores) for the year 2024-25.

c) AVT Natural FZCO (AVT Dubai)

A wholly owned subsidiary was incorporated by the
company on 28^th March 2023 in Dubai for marketing
the Animal nutrition products, food additives, cosmetic
and nutraceutical ingredients with a paid up capital of
AED 22,30,000.

The AVT Natural FzCO recorded sales of Rs.37.95
crores and profit of Rs.4.29 crores for the year 2024-25

Step down subsidiary Companies

AVT Natural Europe Limited, London has one wholly
owned subsidiary AVT Natural North America Inc

i) AVT Natural North America Inc

The paid up capital of the Company as on 31^st March
2025 is USD 60,000 and there is no change therein
since. During the year, the company recorded sales
of Rs.11.81 crores and profit of Rs.0.81 crores for
the year 2024-25.

d) Accounts of subsidiaries

Pursuant to Section 136 of the Companies Act, 2013,
a copy of the audited financial statements of AVT
Natural Europe Ltd., AVT Natural S.A. DE C.V. and
AVT Natural FzCO for the period ended 31.03.2025,
shall be provided to any shareholder, free of cost
on their request. The Audited financial statements
are also available on the website of the Company.
The Consolidated financial statements, audited by
the statutory auditors of the Company, have been
attached to this Report.

Pursuant to Section 129(3) of the Companies Act,
2013, a statement containing the salient features of
the financial statements of AVTN, AVTNE & its step-
down subsidiary and AVTFzCO in the prescribed
Form AOC-1 is provided in the Page No. 147 of
Annual report.

e) Joint Venture / Associate Company

The Company does not have any Joint Ventures /
Associate Companies

f) Policy for determining material subsidiary

The Company has a Policy for determining Material
Subsidiary, which is hosted on the Company website
under the link www.avtnatural.com/investor_relations.

CONSERVATION Of ENERGY, TECHNOLOGY,
ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO

The particulars prescribed by the section 134 (3) (m) of the
Companies Act 2013, read with Rule 8 of the Companies
(Accounts) Rules, 2014 relating to Conservation of Energy,
Technology Absorption, Foreign Exchange earnings and
outgo are furnished in the Annexure-I to this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the
Companies Act 2013, a CSR Committee comprising
Board of Directors was formed to recommend.

i. The policy on Corporate Social Responsibility
(CSR) and

ii. Implementation of the CSR Projects

Annual Report on CSR in the prescribed format is enclosed
as Annexure - II. The CSR policy of the Company has
been uploaded on the web site: www.avtnatural.com /
investor_relations.

CONTENTS OF CSR POLICY

TThe Company''s CSR projects and programs will be the
focus on the holistic development of host communities
to create social, environmental and economic value to
society.

The Company will invest resources in any program such
as skill development, infrastructure development, women
empowerment, Promotion of Health Care, Old age homes
/ day care facilities for Senior Citizens, Education, Swatch
Bharath, and all other activities envisaged in the Schedule
VII of the Companies Act 2013.

STATUTORY AUDITORS

Pursuant to section 139 and 142 of the Companies Act,
2013, the members in their 36^th Annual General Meeting
held on 24.08.2022 appointed M/s. Suri & Co, Chartered
Accountant (Firm Registration No.004283S) as the
Statutory Auditors of the Company for a period of 5 years
till the conclusion of the 41^st Annual General Meeting.
In view of the amendment to the Companies Act 2013
notified by the Ministry of Corporate Affairs dated 7^th May
2018, no longer their appointment needs to be ratified by
the Members.

AUDITORS'' REPORT

There are no qualifications or adverse remarks mentioned
in the Auditors'' report. The notes to accounts, forming part
of financial statements, are self-explanatory and need no
further clarification

SECRETARIAL AUDITORS

Pursuant to Section 204 of Companies Act, 2013 read with
Rule 9 of Companies (Appointment and Remuneration
of Managerial personnel) 2014 and Regulation 24A of
SEBI(Listing Obligations and Disclosure Requirements),
Regulations, 2015, the Board of Directors in their meeting
held on May 28, 2025 approved the appointment of

M/s.V Suresh & Associates as the Secretarial Auditor of the
company for a period of 5 consecutive years w.e.f FY 2025¬
26 based on the recommendations of the Audit Committee
of the Company. The said appointment is subject to the
approval of the shareholders at this Annual General Meeting
of the Company.

SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the
Companies Act, 2013 and the Companies (Appointment
and Remuneration of Managerial Personnel) Rules 2014,
the Company has appointed M/s. V Suresh Associates,
Practicing Company Secretaries (C.P. No.6032), Chennai -
600 018 to undertake the Secretarial Audit of the Company.

The Secretarial Audit Report in form MR-3, submitted by
the Secretarial Auditors for the financial year 2024-25, is
annexed to this report as Annexure III and forms an integral
part of this Report.

During the year, the Company has complied with the
Secretarial Standard -1 (SS-1) and Secretarial Standard -2
(SS-2) issued by the Ministry of Corporate Affairs.

COST RECORDS & AUDIT REPORT

Cost Audit is not applicable to the Company as per the
Companies (Cost Records & Audit) Rules, 2014, however,
the cost records are maintained by the Company.

REPORTING OF FRAUD

The Auditors of the Company have not reported any
fraud as specified under section 143 (12) of the Companies
Act, 2013.

INSURANCE

The Company continues to carry adequate insurance for
all assets, against unforeseeable perils.

RELATED PARTY TRANSACTIONS

All transactions entered with related parties for the year
under review were at arm''s length basis and in the
ordinary course of business and hence the provisions of

Section 188 of the Companies Act, 2013 are not attracted.
There were no related party transactions exceeding 10%
of the annual consolidated turnover as per the last audited
financial statements during the year.

Further, there were no material related party transactions
during the year under review with the Promoters, Directors
or Key Managerial Personnel or other designated
persons which may have a potential conflict in the interest
with Company at large. The disclosure of Related Party
transactions to be provided under section 134 (3)(h)
of the Companies Act 2013, read with Rule 8(2) of the
Companies (Accounts) Rules, 2014 in Form AOC -2 is
given in the Annexure IV, forming part of this report.

As per the SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015, all the related party
transactions were placed before the Audit Committee and
also the Board of Directors. Prior approval of the Audit
Committee was obtained on yearly / quarterly basis for
the transactions entered with related parties, except with
the wholly owned subsidiary Companies, whose accounts
are consolidated with the Company. The transactions
entered into pursuant to the omnibus approval so granted
has been placed before the Audit Committee and the
Board of Directors for their approval on a quarterly basis.

The Company has a Related Party Transaction policy and
the same is hosted on the website of the Company under
the link www.avtnatural.com/investor_relations.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY
THE REGULATORS AND COURTS

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

ANNUAL RETURN

In terms of the requirements of Section 92(3) read with
134(3)(a) of the Companies Act, 2013 read with the
Companies (Accounts) Rules, 2014 the copy of the
Annual Return in prescribed format is available on the
website of the Company. www.avtnatural.com.

STATUTORY Information

The information required under section 197 (12) of the
Companies Act 2013 read with rule 5 (1) of the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014 in respect of the Company have
been given in the Annexure V.

The information under section 197 of Companies Act 2013
and pursuant to rule 5 (2) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014,
are given in the Annexure VI.

The statement containing remuneration paid to
employees and other details as required under Section
197(12) of the Companies Act, 2013 read with Rule
5(2) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014, is provided in a
separate annexure forming part of this report. Further, the
report and the accounts are being sent to the members
excluding the aforesaid annexure. In terms of Section 136
of the Act, the said annexure is open for inspection at the
Company''s Registered Office during, business hours of
all the working days of the Company, upto the date of
the forthcoming Annual General Meeting. Any member
interested in obtaining a copy of the same may write to
the Company Secretary and the same will be provided
free of cost to the member.

INDUSTRIAL RELATIONS

Your Company during the year under review, enjoyed
cordial relationship with technicians/workers and
employees at all levels.

NOMINATION AND REMUNERATION POLICY

The Board on the recommendation of the Nomination &
Remuneration Committee framed a policy for selection
and appointment of Directors, Senior Management
Personnel, Key Managerial Personnel and their
remuneration etc. A copy of the policy is uploaded on the
web site of the Company and the website link is www.
avtnatural. com/investor_relations.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower
Policy in place pursuant to Section 177 (9) of the
Companies Act 2013 and as per the Regulation 22 of
SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015. The said policy is available on the
website of the Company which can be accessed from the
link - www.avtnatural.com During the year no instances
of unethical behavior were reported.

RISK MANAGEMENT

Pursuant to section 134(3)(n) of the Companies Act
2013 and Regulation 21 of SEBI (Listing Obligations and
Disclosure Requirements) Regulations 2015, the Board
of Directors has formed a Risk Management Committee
to frame, implement and monitor the risk management
plan. The Committee is responsible for reviewing the risk
management plan and ensuring its effectiveness. The
Committee considers the risks that impact mid to long-term
objectives of the business, including those reputational in
nature. The Audit Committee has additional oversight in
the area of financial risks and controls.

The company has a risk policy defining risk management
governance model, risk assessment and prioritization
process. The Risk Management Committee adopted a

follow-up risk management framework to review and
monitor the key risks and their mitigation measures
periodically and provide an update to the Board on
Company''s risks. The Audit Committee has an additional
oversight on financial risks and controls.

ADEQUACY OF INTERNAL AUDIT AND INTERNAL
FINANCIAL CONTROL

The Company has in place adequate Internal Audit and
Internal Financial Controls with reference to the financial
statements, which is evaluated by the Audit Committee as
per Part C of Schedule II of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations 2015.

Apart from Statutory Audit, your Company, in compliance
with Section 138 of the Companies Act, 2013, had engaged
M/s Sundar Sridhar Srini, Chartered Accountants, I Floor,
New No 9, Rajamannar Street, T.Nagar, Chennai - 600017
as the Internal Auditors of the Company for the financial
year 2024-25. Findings and observations of the Internal
Auditors are discussed, and suitable corrective actions
are taken as per the directions of the Audit Committee
on an on-going basis to improve efficiency in operations.

The Company''s internal control systems are well
established and commensurate with the nature of its
business and the size and complexities of operations and
adequate with reference to the financial statements as
envisaged under the Companies Act, 2013.

Your directors endorse that during the year under review,
there were no reportable material weaknesses in the
present systems or operations of internal controls.

ENVIRONMENT AND Safety

The Company is conscious of the importance of
environmentally clean and safe operations. The
Company''s policy requires conduct of operations in
such a manner, so as to ensure safety of all concerned,
compliances environmental regulations and preservation
of natural resources.

BOARD EVALUATION

The Board of Directors has made a formal annual
evaluation of its own performance and that of its
committees, individual Directors & CEO, pursuant to the
provisions of the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure Requirements) Regulation,
2015. The evaluation was done based on the evaluation
criteria formulated by Nomination and Remuneration
Committee which includes criteria such as fulfilment
of specific functions prescribed by the regulatory
framework, adequacy of board meetings, attendance and
effectiveness of the deliberations etc.

Each Board member completed a questionnaire
providing feedback on the functioning and overall level
of engagement of the Board and its committees on the
parameters such as the composition, execution of specific
duties, contribution of new ideas/insights, quality, quantity,
and timeliness of flow of information, deliberations at
the meeting, independence / non-partisan approach in
decision making etc.,

Independent Directors met on 12^th February 2025 to review
performance evaluation of Non-Independent Directors
and the entire Board of Directors including the Chairman,
Non-Executive Directors etc., The Independent Directors
were satisfied with the overall functioning of the Board,
flow of information to the Board, its various Committees
and of the performance of other Non-executive Directors
and the Chairman of the Board.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has adopted the Indian Accounting
Standards (Ind AS) with effect from 1^st April 2017, the
Ind AS 115 with effect from 1^st April 2018 & the Ind AS
116 with effect from 1^st April 2019 and all its financial
statements are made according to the said standards.
Further, in the preparation of the financial statements,
the Company has followed the Accounting Standards
referred to in Section 133 of the Companies Act, 2013.
The significant accounting policies which are applied are
set out in the Notes to the Financial Statements.

DEPOSIT FROM PUBLIC

The Company has not accepted any deposits from the
public during the year under review. No amount on
account of principal or interest on deposits from the public
was outstanding as on March 31, 2025.

BUSINESS RESPONSIBILITY & SUSTAINABILITY
REPORT

The Business Responsibility and Sustainability Report
indicates the Company''s performance against the
principles of the ''National Guidelines on Responsible
Business Conduct''. This would enable the Members
to have an insight into Environmental, Social and
Governance initiatives of the Company.

The Business Responsibility and Sustainability Report in
compliance with the regulation 34(f) of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations
2015 have been attached in the Annexure VII to this Report.

CORPORATE GOVERNANCE

Your Company has taken adequate steps to adhere to
all the stipulations laid down in Regulation 27 read with
Part E of Schedule II and Schedule V of SEBI (Listing
Obligations and Disclosure Requirements) Regulations

2015 on corporate Governance. The Management
Discussion & Analysis Report, Report on Corporate
Governance with Auditors'' Certificate on compliance with
conditions of Corporate Governance have been Annexed
IX to this Report.

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

The Company has in place an Anti-Sexual Harassment
Policy in line with the requirements of the Act and that
an Internal Complaints Committee has been set up
for redressal of complaints and that all employees
(permanent, contractual, temporary, trainees) are covered
under this policy.

During the year under review
Number of complaints received in the year: Nil
Number of complaints disposed off during the year: Nil
Number of cases pending for more than 90 days: Nil
Number of Workshop or awareness Program:

2 Workshops and 2 training Program

Nature of Action taken by the employer or District Officer:

Nil

CAUTIONARY STATEMENT

Statements in this Directors'' Report & Management
Discussion and Analysis Report describing the Company''s
objectives, projections, estimates, expectations, or
predictions may be ''forward looking statements'' within
the meaning of applicable securities laws and regulations.
Actual results could differ materially from those expressed
or implied. Important factors that could make difference
to the Company''s operations include raw material
availability and its prices, cyclical demand and pricing in
the Company''s principle markets, changes in Government
regulations, Tax regimes, economic developments within
India and the countries in which the Company conducts
business and other ancillary factors.

During the year no application has been made and
there are no proceeding pending as per Insolvency and
Bankruptcy Code 2016.

The Company has not raised funds through preferential
allotment or qualified institutions placement during the
financial year 2024-25.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

1. In the preparation of the accounts for the financial
year ended 31^st March 2025, the applicable
accounting standards had been followed along with
proper explanation relating to material departures;

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

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

4. The Directors have prepared the accounts for the
financial year ended 31^st March 2025 on a ''going
concern'' basis.

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

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

ACKNOWLEDGEMENT

The Directors sincerely acknowledge the contribution and
support from customers, shareholders, farmers, BSE Ltd.,
National Stock Exchange of India Ltd., Cameo Corporate
Services Ltd., National Securities Depository Ltd., Central
Depository Services Ltd., and other stakeholders for the
co- operation and assistance provided to the Company.

The Directors also place on record their gratitude to the
employees for their continued support, commitment,
dedication and co-operation.

For and on behalf of the Board

Place : Chennai Ajit Thomas

Date : 28^th May 2025 Chairman

---

Mar 31, 2023

Your directors are pleased to present the Thirty Seventh Annual Report of the Company together with the Audited Accounts for the financial year ended March 31, 2023.

FINANCIAL RESULTS	($ in Crores)
Particulars	2022-23	2021-22
Income from Operations	582.25	541.89
Other Income	2.32	9.62
Total Income	584.57	551.51
Profit before tax for the year	102.22	94.31
Less : Provision for taxation Current Tax in respect of current year	27.50	24.95
in respect of prior year	NIL	NIL
Deferred Tax	(0.32)	(1.31)
Profit after Tax	75.04	70.67
Add: OCI classified to Retained Earnings	0.09	0.47
Add: Surplus brought forward	113.74	80.72
Less: Unrealised Fair Value gains not available for appropriation	(3.80)	(2.61)
Total Amount available for dividend payout	185.07	148.31
Less: IInterim Dividend (40%) paid on equity shares	6.09	6.09
Transfer to General Reserve	25.00	25.00
Final Dividend on Equity Shares paid for earlier year	9.13	6.09
Net Amount available for dividend payout	144.85	111.13
Surplus carried Forward to balance sheet	148.65	113.74

Proposed dividend on equity shares has not been recognized as a distribution of profit in the current year''s accounts in accordance with the Indian Accounting Standard.

OPERATIONS REVIEW

Total income increased by 5.99 % to $ 584.57 crores in 2022-23 from $ 551.51crores. The Profit after Tax for the year 2022-23 is $ 75.04 crores (previous year 2021-22

$ 70.67 crores), showing an increase of 6.18 %. With Fixed Assets of $ 78.26 crores (previous year 2021-22 $ 82.01 crores), our Fixed Asset Turnover ratio is healthy at 7.44 % with Return on Sales stood at 18.27%.

DIVIDEND

Dividend Distribution Policy

Pursuant to Regulation 43A of Listing Regulations, the Board adopted a Dividend Distribution Policy, which had been placed on the website of the Company and can be accessed at the link: https://www.avtnatural.com/policies/

Declaration and payment of dividend

Your Directors are pleased to recommend a final dividend of $ 0.60 per share (60%) with face value of $ 1/- each on Equity Share Capital, for the year ended 31.03.2023, amounting to $ 913.70 Lakhs. During the year, the Board declared an Interim Dividend of $ 0.40 per share (40%) with face value of $ 1/- each, amounting to $ 609.14 Lakhs. The aggregate of dividend declared during the year was $ 1/-per share (100 %) with face value of $ 1/- each amounting to $ 1522.84 Lakhs.

TRANSFER TO GENERAL RESERVE

Your directors are pleased to transfer a sum of $ 25 crore for the year 2022-23 (previous year $ 25 crore) to the General Reserve.

FINANCE

Cash and bank balances as at 31^st March,2023 was $ 534.92 lakhs (previous year $ 440.23 lakhs). The Company continues to focus on the judicious management of its working capital, receivables, inventories and other financial parameters and which were kept under strict check through continuous monitoring.

The outstanding term loan from Federal Bank Limited as on 31^st March, 2023 is $ 11.80 crore, which is given in the note No. 16 to the financial statements.

WINDMILL

The wind mill of the Company located at Kokkampalayam Village, Dharapuram Taluk, Erode District, Tamil Nadu generated 842,083 units of electricity in the year 2022-23 against 864,510 units generated in 2021-22. The Company utilised the 828,717 units, generated as captive consumption during 2022-23 for its Sathyamangalam factory.

BOARD MEETING

The Board of Directors met four times during the financial year. The details of the Board meeting are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

AUDIT COMMITTEE MEETING

The Audit Committee of the Company met four times during the current financial year. The details of the Audit Committee meetings are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

PARTICULARS OF LOANS, GUARANTEE, OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013 and Schedule V of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015, except the ''Corporate Guarantee'' given on behalf of its wholly owned subsidiary companies viz., AVT Natural Europe Limited, London and to AVT Natural S.A. DE C.V., Mexico which is given in the note No. 37 to the financial statements.

The details of investments made by the Company are given in the note No. 7 to the financial statements.

LISTING WITH STOCK EXCHANGES

The Company Shares are continued to be listed in both BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid listing fees up to 31^st March 2024 to both the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).

DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT SOUTH VAZHAKULAM AND BANGALORE

The approval by the Department of Scientific and Industrial Research (DSIR), New Delhi for the Company''s R&D facilities situated at South Vazhakulam, Aluva, Kerala and the Manchenahaili Village, Kasabe Hobari, Bangalore are valid upto 31.03.2025.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes or events that have occurred since the date of the Balance Sheet which could have any effect on the financial position of the Company.

DIRECTORS & KEY MANAGERIAL PERSONNEL

As on March 31, 2023, the Company has seven NonExecutive Directors out of which five are Independent Directors. There are two women directors.

i) Director retiring by rotation

In accordance with the provisions of Companies Act, 2013 and the Articles of Association of the Company, Mrs. Shanthi Thomas, Director retires by rotation at the 37^th Annual General Meeting and being eligible, offers herself for re-appointment.

A resolution seeking shareholders'' approval for her reappointment along with other required details forms part of the Notice.

ii) Declaration from Independent Directors on Annual Basis

The Company has received necessary declarations from all the four Independent Directors of the Company under Section 149 of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149 of the Companies Act, 2013 and Regulation 25(8) of the SEBI (LODR) Regulations 2015.

iii) Key Managerial Personnel

As on March 31, 2023, the following were Key Managerial Personnel ("KMP") of the Company as per Sections 2(51) and 203 of the Act:

• Mr. B Krishna Kumar,

Sr. Vice President Operations & Manager

• Mr. A. Ramadas, Sr. Vice President and CFO

• Mr. Sharon Josh, Company Secretary.

PERFORMANCE OF SUBSIDIARY / JOINT VENTURE / ASSOCIATES

a) AVT Natural SA DE C.V., Mexico (AVTN)

AVT Natural SA DE C.V, Mexico has been established with an aim to capture market for the Animal Nutritional products in South American market and other markets.

The paid-up capital of the Company as on 31^st March 2023 is Mexican Peso (Mxn) 0.54 million and there is no change therein since then. AVTN is the marketing arm of your Company for the animal nutrition products. The AVTN recorded sales of $ 6.16 crores and Loss of $ 0.15 crores, for the year 2022-23.

b) AVT Natural Europe Limited, UK (AVTNEL)

The paid-up capital of the Company as on 31^st March 2022 is Pound Sterling (GBP) 1.535 million and there is no change therein since then. AVTNEL is the marketing arm of your Company for de-caffeinated tea and instant tea. The AVTNEL recorded sales of $ 107.82 crores (previous year $ 91.19 crores) and profit of $ 2.42 crores (previous year $ 3.38crores) for the year 2022-23.

c) AVT Natural FZCO (AVT Dubai)

A wholly owned subsidiary was incorporated by the company on 28^th March 2023 in Dubai, UAE for marketing the Animal nutrition products, Instant tea, food additives, cosmetic and nutraceutical ingredients.

Mr. Rahul Thomas, relative of director ceases to be an employee of the parent company w.e.f. 31.03.2023 and has been appointed as Director / General Manager in the Subsidiary w.e.f. 01.04.2023.

Step down subsidiary Companies

AVT Natural Europe Limited, London has one wholly owned subsidiary AVT Natural North America Inc.

i. AVT Natural North America Inc

The paid-up capital of the Company as on 31^st March 2023 is USD 60,000 and there is no change therein since. During the year, the company recorded sales of $ 9.33 crores and profit of $ 0.45 crores for the year 2022-23.

d) Accounts of subsidiaries

Pursuant to Section 136 of the Companies Act, 2013, a copy of the audited financial statements of AVT Natural Europe Ltd., & AVT Natural S.A. DE C.V., for the period ended 31.03.2023, shall be provided to any shareholder, free of cost on their request. The Audited financial statements are also available on the website of the Company. The Consolidated financial statements, audited by the statutory auditors of the Company, have been attached to this Report. Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of AVTN, AVTNEL & its step-down subsidiary in the prescribed Form AOC-1 is provided in the Page No. 148 of Annual report.

e) Joint Venture / Associate Company

The Company does not have any Joint Ventures / Associate Companies

f) Policy for determining material subsidiary

The Company has a Policy for determining Material Subsidiary, which is hosted on the Company website under the link www.avtnatural.com/investor_relations.

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars prescribed by the Section 134 (3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo are furnished in the Annexure-I to this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Companies Act, 2013, a CSR Committee comprising Board of Directors was formed to recommend,

i. The policy on Corporate Social Responsibility (CSR) and

ii. Implementation of the CSR Projects

Annual Report on CSR in the prescribed format is enclosed as Annexure-II. The CSR policy of the Company has been uploaded on the website: www.avtnatural.com / investor_relations.

CONTENTS OF CSR POLICY

The Company''s CSR projects and programs focus on the holistic development of host communities to create social, environmental and economic value to society.

The Company will invest resources in any program such as skill development, infrastructure development, women empowerment, Promotion of Health Care, Old age homes / day care facilities for Senior Citizens, Education, Swatch Bharath, Flora & Fauna and all other activities envisaged in the Schedule VII of the Companies Act, 2013.

STATUTORY AUDITORS

Pursuant to Section 139 and 142 of the Companies Act, 2013, the members in their 36^th Annual General Meeting held on 24.08.2022 appointed M/s. Suri & Co, Chartered Accountant (Firm Registration No.004283S) as the Statutory Auditors of the Company for a period of 5 years till the conclusion of the 41^st Annual General Meeting. In view of the amendment to the Companies Act, 2013 notified by the Ministry of Corporate Affairs dated 7^th May 2018, no longer their appointment needs to be ratified by the Members.

AUDITORS'' REPORT

There are no qualifications or adverse remarks mentioned in the Auditors'' report. The notes to accounts, forming part of financial statements, are self-explanatory and need no further clarification.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed Mr. V. Suresh & Associates, Practicing Company Secretaries (C.P No.6032), Chennai - 600 018 to undertake the Secretarial Audit of the Company.

The Secretarial Audit Report in form MR-3, submitted by the Secretarial Auditors for the financial year 2022-23, is annexed to this report as Annexure - III and forms an integral part of this Report.

There is no secretarial audit qualification, reservation or adverse remarks in the Secretarial Report for the period under review.

During the year, the Company has complied with the Secretarial Standard -1 (SS-1) and Secretarial Standard -2 (SS-2) issued by the Ministry of Corporate Affairs.

COST AUDIT REPORT

Cost Audit is not applicable to the Company as per the Companies (Cost Records & Audit) Rules, 2014, however, the cost records are maintained by the Company.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under Section 143 (12) of the Companies Act, 2013.

INSURANCE

The Company continues to carry adequate insurance, for all assets, against unforeseeable perils.

RELATED PARTY TRANSACTIONS

All transactions entered with related parties for the year under review were at arm''s length basis and in the ordinary course of business and hence the provisions of Section 188 of the Companies Act, 2013 are not attracted. There were no related party transactions exceeding 10% of the annual consolidated turnover as per the last audited financial statements during the year.

Further, there were no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel or other designated persons which may have a potential conflict in the interest with Company at large, except the payment of remuneration of directors relative exceeding $ 30 lakhs per annum, which was approved by the shareholders in its meeting held on 10.08.2017. The disclosure of Related Party transactions to be provided under Section 134 (3)(h) of the Companies Act 2013, read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC -2 is given in the Annexure - IV, forming part of this report.

As per the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, all the related party transactions were placed before the Audit Committee and also the Board of Directors. Prior approval of the Audit Committee was obtained on yearly / quarterly basis for the transactions entered with related parties, except with the wholly owned subsidiary Companies, whose accounts are consolidated with the Company. The transactions entered into pursuant to the omnibus approval so granted has been placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The Company has a Related Party Transaction policy and the same is hosted on the website of the Company under the link www.avtnatural.com/investor_relations.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS AND COURTS

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

ANNUAL RETURN

In terms of the requirements of Section 92(3) read with 134(3)(a) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 the copy of the Annual Return in prescribed format is available on the website of the Company www.avtnatural.com/investor_relations.

STATUTORY INFORMATION

The information under section 197 of Companies Act 2013 and pursuant to rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in the Annexure - V.

The information required under section 197 (12) of the Companies Act 2013 readwith rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the Company have been given in the Annexure -VI.

The statement containing remuneration paid to employees and other details as required under Section 197(12) of the

Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Company''s Registered Office during, business hours of all the working days of the Company, up to the date of the forthcoming Annual General Meeting. Any member interested in obtaining a copy of the same may write to the Company Secretary and the same will be provided free of cost to the member.

INDUSTRIAL RELATIONS

Your Company during the year under review, enjoyed cordial relationship with technicians/workers and employees at all levels.

NOMINATION AND REMUNERATION POLICY

The Board on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management Personnel, Key Managerial Personnel and their remuneration etc. A copy of the policy is uploaded on the web site of the Company and the website link is www.avtnatural.com / investor_relations.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy in place pursuant to Section 177 (9) of the Companies Act 2013 and as per the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The said policy is available on the website of the Company which can be accessed from the link-www.avtnatural.com/investor_relations. During the year no instances of unethical behavior were reported.

RISK MANAGEMENT

Pursuant to section 134(3)(n) of the Companies Act, 2013 and Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board of Directors has formed a Risk Management Committee to frame, implement and monitor the risk management plan. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The Committee considers the risks that impact mid to long-term objectives of the business, including those reputational in nature. The Audit Committee has additional oversight in the area of financial risks and controls.

The company has a risk policy defining risk management governance model, risk assessment and prioritization process. The Risk Management Committee adopted a follow-up risk management framework to review and monitor the key risks and their mitigation measures periodically and provide an update to the Board on Company''s risks. The Audit Committee has an additional oversight on financial risks and controls.

ADEQUACY OF INTERNAL AUDIT AND INTERNAL FINANCIAL CONTROL

The Company has in place adequate Internal Audit and Internal Financial Controls with reference to the financial statements, which is evaluated by the Audit Committee as per Part C of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Apart from Statutory Audit, your Company, in compliance with Section 138 of the Companies Act, 2013, had engaged M/s Varma & Varma, Chartered Accountants, Building No. 53/333, Off. Subash Chandra Bose Road, Vytilla Post, Kochi - 682 019, Kerala as the Internal Auditors of the Company for the financial year 2022-23. Findings and observations of the Internal Auditors are discussed, and suitable corrective actions are taken as per the directions of the Audit Committee on an on-going basis to improve efficiency in operations.

The Company''s internal control systems are well established and commensurate with the nature of its business and the size and complexities of operations and adequate with reference to the financial statements as envisaged under the Companies Act, 2013.

Your directors endorse that during the year under review, there were no reportable material weaknesses in the present systems or operations of internal controls.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Company''s policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances environmental regulations and preservation of natural resources.

BOARD EVALUATION

The Board of Directors has made a formal annual evaluation of its own performance and that of its

committees, individual Directors & Manager, pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. The evaluation was done based on the evaluation criteria formulated by Nomination and Remuneration Committee which includes criteria such as fulfilment of specific functions prescribed by the regulatory framework, adequacy of board meetings, attendance and effectiveness of the deliberations etc.

Each Board member completed a questionnaire providing feed back on the functioning and overall level of engagement of the Board and its committees on the parameters such as the composition, execution of specific duties, contribution of new ideas / insights, quality, quantity, and timeliness of flow of information, deliberations at the meeting, independence / non-partis an approach in decision making etc.,

Independent Directors met on 13^th February 2023 to review performance evaluation of Non-Independent Directors and the entire Board of Directors including the Chairman, NonExecutive Directors etc., The Independent Directors were satisfied with the overall functioning of the Board, flow of information to the Board, its various Committees and of the performance of other Non-executive Directors and the Chairman of the Board.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has adopted the Indian Accounting Standards (Ind AS) with effect from 1^st April 2017, the Ind AS 115 with effect from 1^st April 2018 & the Ind AS 116 with effect from 1^st April 2019 and all its financial statements are made according to the said standards. Further, in the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 133 of the Companies Act, 2013. The significant accounting policies which are applied are set out in the Notes to the Financial Statements.

DEPOSIT FROM PUBLIC

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from the public was outstanding as on March 31, 2023.

BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT

The Business Responsibility and Sustainability Report indicates the Company''s performance against the principles of the ''National Guidelines on Responsible Business Conduct''. This would enable the Members to have an

insight into Environmental, Social and Governance initiatives of the Company.

The Business Responsibility and Sustainability Report in compliance with the regulation 34(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 have been attached in the Annexure VII to this Report.

CORPORATE GOVERNANCE

Your Company has taken adequate steps to adhere to all the stipulations laid down in Regulation 27 read with Part E of Schedule II and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 on corporate Governance. The Management Discussion & Analysis Report, Report on Corporate Governance with Auditors'' Certificate on compliance with conditions of Corporate Governance have been Annexed VII, IX, X and XI to this Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Act and that an Internal Complaints Committee has been set up for redressal of complaints and that all employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year under review Number of complaints received in the year: Nil Number of complaints disposed off during the year: NA Number of cases pending for more than 90 days: Nil Number of Workshop or awareness Program:

Nature of Action taken by the employer or District Officer: Nil

CAUTIONARY STATEMENT

Statements in this Directors'' Report & Management Discussion and Analysis Report describing the Company''s objectives, projections, estimates, expectations, or predictions may be ''forward looking statements'' within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company''s operations include raw material availability and its prices, cyclical demand and pricing in the Company''s principle markets, changes in Government regulations, Tax regimes, economic developments with in India and the countries in which the Company conducts business and other ancillary factors.

During the year no application has been made and there are no proceeding pending as per Insolvency and Bankruptcy Code 2016.

The Company has not raised funds through preferential allotment or qualified institutions placement during the financial year 2022-23.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

1. In the preparation of the 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;

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

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

4. The Directors have prepared the accounts for the financial year ended 31^st March 2023 on a ''going concern'' basis.

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

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

ACKNOWLEDGEMENT

The Directors sincerely acknowledge the contribution and support from customers, shareholders, farmers, BSE Ltd., National Stock Exchange of India Ltd., Cameo Corporate Services Ltd., National Securities Depository Ltd., Central Depository Services Ltd., and other stakeholders for the co-operation and assistance provided to the Company.

The Directors also place on record their gratitude to the employees for their continued support, commitment, dedication and co-operation.

For and On behalf of the Board

Place: Chennai Ajit Thomas

Date : 30^th May 2023 Chairman

---

Mar 31, 2018

The Directors are pleased to present the Thirty Second Annual Report of the Company together with the Audited Accounts for the financial year ended March 31, 2018.

FINANCIAL RESULTS

(Rs. in Crores)

Particulars	2017-18	2016-17
Income from Operations	300.22	307.85
Other Income	12.02	5.91
Total Income	312.24	313.76
Profit before tax for the year	32.98	41.90
Less : Provision for taxation
- Current Tax	11.70	13.25
- Deferred Tax	(0.11)	0.72
Profit after tax	21.39	27.93
Add: OCI classified to Rstained Earnings 0.08		(0.46)
Add: Surplus brought forward	31.95	26.82
Less:
Unrealised Fair Value gains not
available for appropriation	(4.33)	(3.77)
Total Amount available for
dividend payout	49.09	50.52
Less:
Interim Dividend (20%) paid on
equity shares	3.05	3.05
Tax on Interim Dividend	0.62	0.62
Transfer to General Reserve	10.00	15.00
Final Dividend on Equity Shares
paid for earlier year	3.05	3.05
Tax on Final Dividend	0.62	0.62
Net Amount available for
dividend payout	31.75	28.18
Surplus carried Forward to
balance sheet	36.08	31.95
Proposed Final Dividend for the current year *
Tax on proposed final dividend for the current year *

* Proposed final dividend on equity shares and tax on dividend have not been recognised as a liability in the current year’s accounts in accordance with the Indian Accounting Standard 10 Events after the reporting period.

OPERATIONS REVIEW

Total income decreased from Rs. 313.76 crores in 2016-17 to 312.24 Crores in 2017-18 with a fall of 0.49%. Profit after Tax for the year 2017-18 is Rs. 21.39 Crores (previous year : Rs. 27.93 Crores), a decrease of 23.40%.

With Fixed Assets of Rs 84.47 Crores (previous year Rs.57.43 crores), our Fixed assets turnover ratio is a healthy 5.29 (previous year 5.32) with Return on Sales of 11.52% (previous year 13.93%).

DIVIDEND

Your Directors are pleased to recommend a final dividend of Re.0.20 per share (20%) with face value of Re.1/- each on Equity Share Capital, for the year ended 31.03.2018, amounting to Rs 304.57 Lakhs, excluding dividend tax. During the year, the Board declared an Interim Dividend of Re.0.20 per share (20%) with face value of Re.1/- each, amounting to Rs.304.57 Lakhs, excluding dividend tax. The aggregate of dividend declared during the year is Re.0.40 per share (40%) with face value of Re.1/- each amounting to Rs.609.14 Lakhs, excluding dividend tax.

TRANSFER TO GENERAL RESERVE

Your directors are pleased to transfer a sum of Rs.10 crore to the General Reserve

FINANCE

Cash and bank balances as at 31^st March 2018 was Rs.664.84 lakhs (previous year Rs.799.12 lakhs). The Company continues to focus on judicious management of its working capital, receivables, inventories and other working capital parameters and which were kept under strict check through continuous monitoring.

WINDMILL

The wind mill of the Company located at Kokkampalayam village, Dharapuram Taluk, Erode District, Tamil Nadu generated 9,98,609 units of electricity in the year 2017-18 against 9,32,626 units generated in 2016-17. The Company had utilised the 6,54,032 units generated as captive consumption during 2017-18 for its Satyamangalam plant and the balance units were sold to TNEB.

BOARD MEETING

The Board of Directors met six times during the financial year. The details of the Board meeting are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

AUDIT COMMITTEE MEETING

The Audit Committee of the Company met six times during the current financial year. The details of the Audit Committee meetings are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013 and Schedule V of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015, except the ‘Corporate Guarantee’ given on behalf of its wholly owned subsidiary AVT Tea Services Ltd., London, which is given in the notes No.34 to the financial statements.

The details of investments made by the Company are given in the notes No.5 to the financial statements.

LISTING WITH STOCK EXCHANGES

The Company shares are continued to be listed in both BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid listing fees up to 31^st March 2019 to the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).

DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT VAZHAKULAM, ALUVA AND BANGALORE

The recognition by the Department of Scientific and Industrial Research (DSIR), New Delhi for the Company’s both R&D facilities situated at Vazhakulam, Aluva, Ernakulam Dt., Kerala and the Manchenahaili Village, Kasabe Hobari, Bangalore are valid upto 31^st March, 2019.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes or events that have occurred since the date of the Balance Sheet which could have any effect on the financial position of the Company

DIRECTORS & KEY MANAGERIAL PERSONNEL

i) Director retiring by rotation

In accordance with the provisions of Companies Act, 2013 and the Articles of Association of the Company, Mr. Habib Hussain, Director retires by rotation at the 32^nd Annual General Meeting and being eligible, offers himself for re-appointment.

ii) Declaration from Independent Directors on Annual Basis The Company has received necessary declaration from all the three Independent Directors of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6) of the Companies Act, 2013.

iii) Key Managerial Personnel

Mr. M.N. Satheesh Kumar, President and CEO, Mr. A. Ramadas, Sr. Vice President and CFO and Mr. Dileepraj. P, Company Secretary are the Key Managerial Personnel of the Company.

PERFORMANCE OF SUBSIDIARY/JOINT VENTURE /ASSOCIATES

a) AVT Tea Services Ltd., London, UK (AVTTSL)

The present authorized share capital of the Company is Pound Sterling (GBP) 1 million. The paid up capital of the Company as on 31^st March 2018 is Pound Sterling (GBP) 1 million. AVTTSL is the marketing arm of your Company for de-caffeinated tea and instant tea. The AVTTSL recorded sales of Rs.106 Crores (previous year Rs.74 crore) and profit of Rs.1.31 crore (previous year loss of Rs.0.93 crore) for the year 2017-18.

The increase in Instant Tea business of your Company is the result of continued and persistent marketing strategy pursued by them.

Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of subsidiary and step-down subsidiary in the prescribed Form AOC-1 is provided in the Page Nos. 92 & 93 of Annual report.

b) Accounts of subsidiaries

Pursuant to Section 136 of the Companies Act, 2013, a copy of the audited financial statements of AVT Tea Services Ltd., London for the period ended 31.03.2018, the overseas subsidiary of your Company shall be provided to any shareholder, free of cost on their request. The Audited financial statements are also available on the website of the Company. The consolidated financial statements audited by the statutory auditors of the Company have been attached to this Report.

c) Joint Venture / Associate Company

The Company does not have any Joint Venture / Associate Company

d) Conservation of energy, technology, absorption, foreign exchange earnings and Outgo

The particulars prescribed by the section 134 (3) (m) of the Companies Act 2013, read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 relating to Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo are furnished in the Annexure-I to this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Companies Act 2013, CSR Committee of the Board of Directors was formed to recommend

a. Ihe policy on Corporate Social Responsibility (CSR) and

b. implementation of the CSR Projects to be undertaken by the Company as per the CSR Policy for consideration and approval by the Board of Directors.

Annual Report on CSR in the prescribed format is enclosed as Annexure - II. The CSR policy of the Company has been already uploaded in the web site: www.avtnatural.com /investor_relations.

CONTENTS OF CSR POLICY

The Company’s commitment to CSR projects and programs will be the focus on holistic development of host communities and create social, environmental and economic value to the society. CSR initiatives of the Company are such that it stimulate well-being in the community and fulfil the role as responsible corporate citizen.

To Company’s commitment to CSR projects and programs will be by investing resources into any of the areas like Development of Skilling among various sections of society, Development of Infrastructure, Empowerment of Women, Promotion of Health Care, Old age homes / day care facilities for Senior Citizens, Promotion of Education, Swatch Bharath and all other activities envisaged in the Schedule VII of the Companies Act 2013.

The Company has won NIPM Kerala Best Corporate Citizen Award 2017, (under Category II) for those companies with CSR Minimum Budget between Rs. 51 Lakhs and Rs. 99 Lakhs during FY 2016-17. The aim of the award was to identify and recognize the efforts of companies in integrating and internalizing Corporate Social Responsibility (CSR) into their core business operations. The award acknowledges efforts of the companies which engage in CSR in a strategic and systematic manner and integrate it with their overall corporate strategy.

STATUTORY AUDITORS

Pursuant to section 139 and 142 of the Companies Act, 2013, the members in their 31^st Annual General Meeting held on 10.8.2017 had appointed M/s PKF Sridhar & Santhanam LLP, Chartered Accountants, KRD Gee Gee Crystal, 7^th Floor, 91-92, Dr. Radhakrishanan Salai, Mylapore, Chennai - 600004, (Firm’s Registration No. 003990S / S200018)), the Statutory Auditors of the Company for a period of 5 years till the conclusion of the 36^th Annual General Meeting. In view of the amendments to the Companies Act 2013, their appointment need not required to be ratified by the Members in the forthcoming AGM.

AUDITORS’ REPORT

There are no qualifications or adverse remarks mentioned in the Auditors’ report. The notes to accounts forming part of financial statements are self-explanatory and needs no further clarification.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed Mr. V. Suresh, Practising Company Secretary (C.P. No.6032), Chennai — 600 018 to undertake the Secretarial Audit of the Company.

The Secretarial Audit Report in form MR-3, submitted by the Secretarial Auditors for the financial year 2017-18, is annexed to this report as Annexure — III and forms an integral part of this Report.

There is no secretarial audit qualification, reservation or adverse remarks in the Secretarial Report for the period under review.

The relevant Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) relating to the Board and General Meetings have been complied with by the Company.

INTERNAL AUDIT, ITS ADEQUACY AND INTERNAL FINANCIAL CONTROL

The Company has in place adequate Internal Audit and Internal Financial Controls with reference to the financial statements, which is evaluated by the Audit Committee as per Part C of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

In compliance with Section 138 of the Companies Act, 2013, the Company had engaged M/s Varma & Varma, Chartered Accountants, Building No. 53/333, Off. Subash Chandra Bose Road, Vytilla Post, Kochi — 682 019, Kerala as the Internal Auditors of the Company for the financial year 2017-18. Findings and observations of the Internal Auditors are discussed and suitable corrective actions are taken as per the directions of the Audit Committee on an on-going basis to improve efficiency in operations. Thus the internal audit function essentially validates the compliance of the Company.

The Company’s internal control systems are well established and commensurate with the nature of its business and the size and complexities of operations and adequate with reference to the financial statements as envisaged under the Companies Act, 2013.

Your directors endorse that during the year under review, there were no reportable material weaknesses in the present systems or operations of internal controls.

COST AUDIT REPORT

Cost Audit is not applicable to the Company as per the Companies (Cost Records & Audit) Rules, 2014. However, the cost records are maintained by the Company.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act, 2013.

INSURANCE

The Company continues to carry adequate insurance for all assets against unforeseeable perils.

RELATED PARTY TRANSACTIONS

All transactions entered with related parties for the year under review were at arm’s length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. There were no transactions exceeding 10% of the annual consolidated turnover as per the last audited financial statements, during the year.

Further, there were no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large, except the revision in remuneration of director’s relative exceeding Rs.30 lakhs per annum, which was approved by the shareholder in its meeting held on 10.08.2017. Accordingly, the disclosure of Related Party transactions to be provided under section 134 (3)(h) of the Companies Act 2013, read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC -2 is given in the Annexure — IV, forming part of this report.

As per the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, all the related party transactions were placed before the Audit Committee and also the Board of Directors The prior omnibus approval of the Audit Committee was obtained on yearly / quarterly basis for the transactions entered with related parties, except with the wholly owned subsidiary Company, whose accounts are consolidated with the Company. The transactions entered into pursuant to the omnibus approval so granted has been placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The Company is having both the Related Party Transaction policy and the Policy for determining Material Subsidiary, which are hosted in the website of the Company under the link www.avtnatural.com/investor_relations.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS AND COURTS

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

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT - 9 is enclosed herewith as Annexure - V.

STATUTORY INFORMATION

The information under section 197 of Companies Act 2013 and pursuant to rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are not required, as none of the employees falls under this category.

The information required under section 197 (12) of the Companies Act 2013 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the Company have been given in the Annexure - VI.

The statement containing remuneration paid to employees and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company during business hours on working days of the Company upto the date of the forthcoming Annual General Meeting. Any member interested in obtaining a copy of the same may write to the Company Secretary and the same will be provided free of cost to the member.

INDUSTRIAL RELATIONS

Your Company during the year under review, enjoyed a cordial relationship with technicians/workers and employees at all levels.

NOMINATION AND REMUNERATION POLICY

The Board on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management Personnel, Key Managerial Personnel and their remuneration etc. A copy of the policy is uploaded in the web site of the Company and the website link is www.avtnatural.com/ investor_relations.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy in place pursuant to Section 177 (9) of the Companies Act 2013 and as per the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The said policy is available in the website of the Company which can be accessed from the link -www.avtnatural.com/investor_relations. During the year no instances of unethical behavior were reported.

RISK MANAGEMENT

Pursuant to Section 134 (3) (n) of the Companies Act, 2013 and the Regulation 21 (5) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Company had laid down the procedures to inform Board members about the risk assessment and mitigation procedures.

The Company is having in place a ‘Risk policy and risk management Procedures’. Mr. A. Ramadas, Sr. Vice President and CFO has been assigned the task of informing the Board about the various risks and its mitigation by the Company from time to time. At present the Company has not identified any element of risk which may threaten the existence of the Company.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Company’s policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances environmental regulations and preservation of natural resources.

BOARD EVALUATION

The Board of Directors has made a formal annual evaluation of its own performance and that of its committees, individual Directors & CEO, pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. The evaluation was done based on the evaluation criteria formulated by Nomination and Remuneration Committee which includes criteria such as fulfilment of specific functions prescribed by the regulatory framework, adequacy of board meetings, attendance and effectiveness of the deliberations etc.

Each Board member completed a questionnaire providing feedback on the functioning and overall level of engagement of the Board and its Committees on the parameters such as the composition, execution of specific duties, contribution of new ideas/insights, quality, quantity and timeliness of flow of information, deliberations at the meeting, independence/non-partisan approach in decision making etc.,

Independent Directors met on 5^th February 2018 to review performance evaluation of Non-Independent Directors and the entire Board of Directors including the Chairman, Non-Executive Directors etc., The Independent Directors were satisfied with the overall functioning of the Board, flow of information to the Board, its various Committees and also of the performance of other Non-executive Directors and the Chairman of Board.

DISCLOSURE OF ACCOUNTING TREATMENT

The Company has adopted the Indian Accounting Standards (Ind AS) with effect from 1^st April 2017 and all its financial statements are made according to the said standard. Further, in the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 133 of the Companies Act, 2013. The significant accounting policies which are applied are set out in the Notes to the Financial Statements.

CORPORATE GOVERNANCE

Your Company has taken adequate steps to adhere to all the stipulations laid down in Regulation 27 read with Part E of Schedule II and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 on Corporate Governance. The Management Discussion & Analysis Report, Report on Corporate Governance with Auditors’ Certificate on compliance with conditions of Corporate Governance have been Annexed VII & VIII to this Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Act and that an Internal Complaints Committee has been set up for redressal of complaints and that all employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year the Company has not received any complaint under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.

GST IMPLEMENTATION

Goods and Service Tax (GST) is an indirect tax or consumption tax) levied by the Government on the sale of goods and services. GST is levied at every step in the production process, but is refunded to all parties in the chain of production other than the final consumer. The tax replaced existing multiple cascading taxes levied by the Central and State Governments. Your Company has implemented the same with effect from 1^st July 2017, in accordance with the implementation of the new taxation regime.

EXPANSION OF ACTIVITY IN TIPTUR

As decided by the Board in its meeting held on 10^th August 2017, the operations of the Company is getting expanded at Tiptur in Karnataka.

CAUTIONARY STATEMENT

Statements in this Directors’ Report & Management Discussion and Analysis Report describing the Company’s objectives, projections, estimates, expectations or predictions may be ‘forward looking statements’ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company’s operations include raw material availability and its prices, cyclical demand and pricing in the Company’s principle markets, changes in Government regulations, Tax regimes, economic developments within India and the countries in which the Company conducts business and other ancillary factors.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

1. In the preparation of the accounts for the financial year ended 31^st March 2018, the applicable accounting standards had been followed along with proper explanation relating to material departures;

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

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

4. The Directors have prepared the accounts for the financial year ended 31^st March 2018 on a ‘going concern’ basis.

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

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

ACKNOWLEDGEMENT

Your Directors sincerely acknowledge the support & Co-operation extended by the customers, farmers, suppliers, bankers viz., State Bank of India, Bank of Baroda, Citibank N.A., The South Indian Bank Limited and the Hongkong and Shanghai Banking Corporation Limited, Central and State Governments, Local Authorities and other Stakeholders .

We are also grateful to our shareholders who are pillars of the Company, who reposed their faith in the Company and its management.

Your Directors also pleased to place on record the gratitude & appreciation for the commitment, dedication and hard work of all the employees of the Company.

For and On behalf of the Board

Place : Chennai Ajit Thomas

Date : 29^th May 2018 Chairman

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Mar 31, 2017

The Directors are pleased to present the Thirty First Annual Report of the Company together with the Audited Accounts for the financial year ended March 31, 2017.

FINANCIAL RESULTS

(Rs. in Crores)

Particulars	2016-17	2015-16
Income from Operations	310.80	267.31
Other Income	0.45	1.16
Total Income	311.25	268.47
Profit before tax for the year	38.62	34.71
Less : Provision for taxation
- Current Tax	13.25	11.00
- Deferred Tax	(0.41)	0.45
Profit after tax	25.78	23.26
Add: Surplus brought forward	22.38	21.45
Total Amount available for appropriation	48.16	44.71
Less:
Interim Dividend (20%) paid on
equity shares	3.05	3.05
Tax on Interim Dividend	0.62	0.62
Transfer to General Reserve	15.00	15.00
Proposed Final Dividend on Equity Shares *		3.05
Provision for tax on Final Dividend	*	0.62
Surplus carried Forward to balance sheet	29.49	22.38

* Proposed dividend on equity shares and tax on dividend has not been recognized as a distribution of profit in the current year’s accounts in accordance with the revised accounting standard-4 ‘Contingencies and Events occurring after the Balance Sheet Date’ (effective from 01.04.2016)

OPERATIONS REVIEW

Total income increased from Rs.268.47 Crores in 2015-16 to Rs. 311.25 Crores in 2016-17 an increase of 15.93%. Profit after Tax for the year 2016-17 was Rs. 25.78 Crores (previous year : Rs.23.26 Crores), a growth of 10.81%.

With Fixed Assets of Rs.57.43 Crores (previous year Rs.59.02 crores), our Asset Turnover ratio is a healthy 5.41 with Return on Sales of 12.56%.

DIVIDEND

Your Directors are pleased to recommend a final dividend of 20% on Equity Share Capital, for the year ended 31.03.2017, amounting to Rs. 304.57 Lakhs, excluding dividend tax. During the year, the Board declared an Interim Dividend of 20%, amounting to Rs.304.57 Lakhs, excluding dividend tax. The aggregate of dividend declared during the year was 40% amounting to Rs. 609.14 Lakhs, excluding dividend tax.

TRANSFER TO GENERAL RESERVE

Your directors are pleased to transfer a sum of Rs. 15 crore towards the General Reserve

FINANCE

Cash and cash equivalents as at 31^st March 2017 was Rs.799.12 lakhs (previous year Rs.743.57 lakhs). The Company continues to focus on judicious management of its working capital, receivables, inventories and other working capital parameters and which were kept under strict check through continuous monitoring.

WINDMILL

The wind mill of the Company located at Kokkampalayam village, Dharapuram Taluk, Erode District, Tamil Nadu generated 9,32,626 units of electricity in the year 2016-17 against 6,50,659 units generated in 2015-16. The Company had utilized the 8,99,994 units generated as captive consumption during 2016-17 for its Satyamangalam plant and the balance units are being sold to TNEB.

BOARD MEETING

The Board of Directors met five times during this financial year. The details of the Board meeting are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

AUDIT COMMITTEE MEETING

The Audit Committee of the Company met five times during the current financial year. The details of the Audit Committee meetings are given in the Corporate Governance report. The intervening gap between the meetings were within the period stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013 and Schedule V of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015, except the ‘Corporate Guarantee’ given on behalf of AVT Tea Services Ltd., London, which is given in the notes No. 28 to the financial statements.

The details of investments made by the Company are given in the notes No. 11 & 13 to the financial statements.

LISTING WITH STOCK EXCHANGES

The Company shares are continued to be listed in both BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company has paid listing fees up to 31^st March 2018 to the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).

DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT SOUTH VAZHAKULAM AND BANGALORE

Department of Scientific and Industrial Research (DSIR), New Delhi has renewed its recognition for both our R&D facilities at South Vazhakulam, Aluva, Kerala and the Manchenahaili Village, Kasabe Hobari, Bangalore is valid till 31^st March, 2019.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes or events that have occurred since the date of the Balance Sheet which could have any effect on the financial position of the Company

DIRECTORS & KEY MANAGERIAL PERSONNEL

i) Director retiring by rotation

In accordance with the provisions of Companies Act, 2013 and the Articles of Association of the Company, Mrs. Shanthi Thomas, Director retires by rotation at the 31^st Annual General Meeting and being eligible, offers herself for re-appointment.

ii) Declaration from Independent Directors on Annual Basis The Company has received necessary declaration from all the three Independent Directors of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6) of the Companies Act, 2013.

iii) Appointment of ‘Manager’

The Board in its meeting held on 07.02.2017 has appointed Mr. M.N. Satheesh Kumar, as the ‘Manager’ under section 203(1) of the Companies Act 2013 and designated as President and CEO for a period of 3 years, w.e.f. 01.04.2017. Necessary resolution is being placed before the members for their approval.

iv) Key Managerial Personnel

Mr. M.N. Satheesh Kumar, President and CEO, Mr. A. Ramadas, Sr. Vice President and CFO and Mr. Dileepraj. P, Company Secretary are the Key Managerial Personnel of the Company.

PERFORMANCE OF SUBSIDIARY/JOINT VENTURE /ASSOCIATES a) AVT Tea Services Ltd., London, UK (AVTTSL):

The present authorized share capital of the Company is Pound Sterling (GBP) 1 million. The paid up capital of the Company as on 31^st March 2017 is Pound Sterling (GBP) 1 million. AVTTSL is the marketing arm of your Company for de-caffeinated tea and instant tea. The AVTTSL recorded sales of Rs.74 Crores (previous year Rs.48 crore) and loss of Rs.0.93 crore (previous year Rs.1.63 crore) for the year 2016-17.

The increase in Instant Tea business of your Company is the result of continued and persistent marketing strategy pursued by them.

Pursuant to Section 129(3) of the Companies Act, 2013, a statement containing the salient features of the financial statements of subsidiary and step-down subsidiary in the prescribed Form AOC-1 is provided in the Page Nos. 70 & 71 of Annual report.

c) Accounts of subsidiaries:

Pursuant to Section 136 of the Companies Act, 2013, a copy of the audited financial statements of AVT Tea Services Ltd., London for the period ended 31.03.2017, the overseas subsidiary of your Company shall be provided to any shareholder, free of cost on their request. The Audited financial statements are also available on the website of the Company. The Consolidated financial statements audited by the statutory auditors of the Company have been attached to this Report.

d) Joint Venture / Associate Company

The Company does not have any Joint Venture / Associate Company

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars prescribed by the section 134 (3) (m) of the Companies Act 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo are furnished in the Annexure-I to this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Companies Act 2013, CSR Committee of the Board of Directors was formed to recommend

a. the policy on Corporate Social Responsibility (CSR) and

b. implementation of the CSR Projects to be undertaken by the Company as per the CSR Policy for consideration and approval by the Board of Directors.

Annual Report on CSR in the prescribed format is enclosed as Annexure - II. The CSR policy of the Company has been already uploaded in the web site: www.avtnatural. com/investor_relations.

CONTENTS OF CSR POLICY

The Company’s commitment to CSR projects and programs will be the focus on holistic development of host communities and create social, environmental and economic value to the society. CSR initiatives of the Company are such that it stimulate well-being in the community and fulfil the role as responsible corporate citizen.

To Company’s commitment to CSR projects and programs will be by investing resources into any of the areas like Development of Skilling among various sections of society, Development of Infrastructure, Empowerment of Women, Promotion of Health Care, Old age homes / day care facilities for Senior Citizens, Promotion of Education, Swatch Bharath and all other activities envisaged in the Schedule VII of the Companies Act 2013.

The Company has won NIPM Kerala Best Corporate Citizen Award 2016, (under Category II) for those companies with CSR Minimum Budget between Rs. 51 Lakhs and Rs. 99 Lakhs during FY 2015-16. The aim of the award was to identify and recognize the efforts of companies in integrating and internalizing Corporate Social Responsibility (CSR) into their core business operations. The award acknowledges efforts of the companies which engage in CSR in a strategic and systematic manner and integrate it with their overall corporate strategy.

STATUTORY AUDITORS

M/s. Suri & Co., Chartered Accountants, Chennai - 600017, (Firm’s Registration No. 004283S), the present Statutory Auditors of the Company have completed their term as per Sec 139 of the Companies Act, 2013. They will be holding the office of Statutory Auditors up to the conclusion of the forthcoming Annual General Meeting.

In their place, the Company is proposing to appoint M/s PKF Sridhar & Santhanam LLP, Chartered Accountants, KRD Gee Gee Crystal, 7^th Floor, 91-92, Dr. Radhakrishanan Salai, Mylapore, Chennai - 600004, (Firm’s Registration No. 003990S / S200018) as Statutory Auditors for a period of 5 years commencing from the conclusion of the 31^st Annual General Meeting till the conclusion of the 36^th Annual General Meeting. They have also consented to the said appointment and confirmed that their appointment, if made, would be within the limits mentioned under section 141 (3) (g) of the Companies Act, 2013, and the Companies (Audit and Auditors) Rules, 2014.

The Audit Committee and the Board of Directors recommend the appointment of M/s PKF Sridhar & Santhanam LLP, Chartered Accountants, KRD Gee Gee Crystal, 7^th Floor, 91-92, Dr. Radhakrishanan Salai, Mylapore, Chennai - 600004, as Statutory Auditors of the Company from the conclusion of the 31^st Annual General Meeting.

AUDITORS’ REPORT

There are no qualifications or adverse remarks mentioned in the Auditors’ report. The notes to accounts forming part of financial statements are self-explanatory and needs no further clarification.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed Mr. V. Suresh, Practicing Company Secretary (C.P. No.6032), Chennai — 600 018 to undertake the Secretarial Audit of the Company.

The Secretarial Audit Report in form MR-3, submitted by the Secretarial Auditors for the financial year 2016-17, is annexed to this report as Annexure — III and forms an integral part of this Report.

There is no secretarial audit qualification, reservation or adverse remarks in the Secretarial Report for the period under review.

INTERNAL AUDITORS

During the year under review, M/s. PKF Sridhar & Santhanam LLP, Chartered Accountants, Chennai — 600 004 carried out the internal audit of the Company and submitted their reports. They have completed their tenure as on 31.03.2017 and in their place, the Board in its meeting held on 6^th April 2017 have appointed M/s Varma & Varma, Chartered Accountants, Ernakulam, Kerala as the internal auditor of the Company for the period 01.04.2017 to 31.03.2018.

COST AUDIT REPORT

Cost Audit is not applicable to the Company as per the Companies (Cost Records & Audit) Rules, 2014, however, the cost records are maintained by the Company.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act, 2013.

INSURANCE

The Company continues to carry adequate insurance for all assets against unforeseeable perils.

RELATED PARTY TRANSACTIONS

All transactions entered with related parties for the year under review were at arm’s length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. No Material Related Party transactions i.e. transactions exceeding 10% of the annual consolidated turnover as per the last audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party transactions to be provided under section 134 (3)(h) of the Companies Act 2013, in Form AOC -2 is not applicable

Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

As per the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, all the related party transactions were placed before the Audit Committee and also the Board. Prior omnibus approval of the Audit Committee is obtained on yearly / quarterly basis for the transactions entered with related parties, except the wholly owned subsidiary Company whose accounts are consolidated with the Company. The transactions entered into pursuant to the omnibus approval so granted has been placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The policy on Related Party Transaction as approved by the Board of Directors has been uploaded on the website of the Company and the website link is www.avtnatural.com/ investor_relations.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS AND COURTS

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

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT - 9 is enclosed herewith as Annexure - IV.

STATUTORY INFORMATION

The information under section 197 of Companies Act 2013 and pursuant to rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are not required, as none of the employees falls under this category.

The information required under section 197 (12) of the Companies Act 2013 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the Company have been given in the Annexure - V.

The statement containing remuneration paid to employees and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company during business hours on working days of the Company upto the date of the forthcoming Annual General Meeting. Any member interested in obtaining a copy of the same may write to the Company Secretary and the same will be provided free of cost to the member.

INDUSTRIAL RELATIONS

Your Company during the year under review, enjoyed a cordial relationship with workers and employees at all levels.

NOMINATION AND REMUNERATION POLICY

The Board on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management Personnel, Key Managerial Personnel and their remuneration etc. A copy of the policy is uploaded in the web site of the Company and the website link is www.avtnatural.com/ investor_ relations.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy in place pursuant to Section 177 (9) of the Companies Act 2013 and as per the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The said policy is available in the website of the Company which can be accessed from the link -www.avtnatural.com/investor_relations.

RISK MANAGEMENT

Pursuant to Section 134 (3) (n) of the Companies Act, 2013 and the Regulation 21 (5) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Company had laid down the procedures to inform Board members about the risk assessment and mitigation procedures.

Mr. A. Ramadas, Sr. Vice President and CFO has been assigned the task of informing the Board about the various risks and its mitigation by the Company from time to time. At present the Company has not identified any element of risk which may threaten the existence of the Company.

ADEQUACY OF INTERNAL AUDIT AND INTERNAL FINANCIAL CONTROL

The Company has in place adequate Internal Audit and Internal Financial Controls with reference to the financial statements, which is evaluated by the Audit Committee as per Part C of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Apart from Statutory Audit, your Company, in compliance with Section 138 of the Companies Act, 2013, had engaged M/s PKF Sridhar & Santhanam LLP., Chartered Accountants, KRD GEE GEE Crystal, 7^th Floor, 91-92, Dr. Radhakrishanan Salai, Mylapore, Chennai - 600004, as the Internal Auditors of the Company for the financial year 2016-17. Findings and observations of the Internal Auditors are discussed and suitable corrective actions are taken as per the directions of the Audit Committee on an on-going basis to improve efficiency in operations. Thus the internal audit function essentially validates the compliance of the Company.

The Company’s internal control systems are well established and commensurate with the nature of its business and the size and complexities of operations and adequate with reference to the financial statements as envisaged under the Companies Act, 2013.

Your directors confirm that during the year under review, there were no reportable material weaknesses in the present systems or operations of internal controls.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Company’s policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances environmental regulations and preservation of natural resources.

BOARD EVALUATION

As per provisions of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015, the evaluation process for the performance of the Board, its Committees and individual Directors were carried out internally. Each Board member completed a questionnaire providing feedback on the functioning and overall level of engagement of the Board and its Committees on the parameters such as the composition, execution of specific duties, contribution of new ideas/insights, quality, quantity and timeliness of flow of information, deliberations at the meeting, independence/ non-partisan approach in decision making etc.,

Independent Directors met on 7^th February 2017 to review performance evaluation of Non-Independent Directors and the entire Board of Directors including the Chairman, taking into account the view of Non-Executive Directors. The Independent Directors were highly satisfied with the overall functioning of the Board, flow of information to the Board, its various Committees and also of the performance of other Non-executive Directors. They also appreciated the exemplary leadership role of the Board Chairman who focused on long-term growth and strategy and his encouragement to management team.

DISCLOSURE OF ACCOUNTING TREATMENT

In the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 133 of the Companies Act, 2013. The significant accounting policies which are consistently applied are set out in the Notes to the Financial Statements.

CORPORATE GOVERNANCE

Your Company has taken adequate steps to adhere to all the stipulations laid down in Regulation 27 read with Part E of Schedule II and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 on Corporate Governance. The Management Discussion & Analysis Report, Report on Corporate Governance with Auditors’ Certificate on compliance with conditions of Corporate Governance have been Annexed VI & VII to this Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Act and that an Internal Complaints Committee has been set up for redressal of complaints and that all employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year the Company has not received any complaint under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.

CAUTIONARY STATEMENT

Statements in this Directors’ Report & Management Discussion and Analysis Report describing the Company’s objectives, projections, estimates, expectations or predictions may be ‘forward looking statements’ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company’s operations include raw material availability and its prices, cyclical demand and pricing in the Company’s principle markets, changes in Government regulations, Tax regimes, economic developments within India and the countries in which the Company conducts business and other ancillary factors.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

1. In the preparation of the accounts for the financial year ended 31^st March 2017, the applicable accounting standards had been followed along with proper explanation relating to material departures;

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

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

4. The Directors have prepared the accounts for the financial year ended 31^st March 2017 on a ‘going concern’ basis.

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

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

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The information under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 for the year ended March 31, 2017 is given here below and forms part of the Directors Report.

A. CONSERVATION OF ENERGY

AVT Natural Products Limited is committed to conserve energy in all our activities. We, the Company has been doing energy conservation projects for many years. During the financial year 2016-17 also the Company has taken steps to conserve energy.

- Installed a 6 KM long dedicated power line (Areal Bunched Cable) from Kerala State Electricity Board sub-station to the Vazhakulam factory. This reduces the transmission loss of energy as well as break downs in the distribution system. This would also help to reduce the over all running time of Diesel Generator (DG).

- New power line to dehydration plant at Tiptur in Karnataka is being commissioned. By this the factory is getting 24 hours power for the operation which reduces the usage of Diesel Generator (DG) to less than 5 % from 100%.

ACKNOWLEDGEMENT

The Directors take this opportunity to thank and place on record their sincere appreciation for the continued cooperation and support extended by the farmers customers, suppliers, bankers viz., State Bank of India, Bank of Baroda, Citibank N.A., The South Indian Bank Limited and the Hongkong and Shanghai Banking Corporation Limited, Central and State Governments, and the Local Authorities and other Stakeholders for their continued guidance and support.

Your Directors would also like to place on record the sincere appreciation for the commitment, dedication and hard work put in by every employee of the Company and to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.

For and On behalf of the Board

Place : Chennai Ajit Thomas

Date : 29^th May 2017 Chairman

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Mar 31, 2015

Dear Members,

The Directors are pleased to present the Twenty Ninth Annual Report of the Company together with the Audited Accounts for the financial year ended March 31, 2015.

FINANCIAL RESULTS:

(Rs. In Crores)

Particulars 2014-15 2013-14

Income from Operations 256.59 271.08

Other Income 3.29 3.60

Total Income 259.88 274.68

Profit before tax for the year 44.20 76.14

Less : Provision for taxation

- Current Tax 14.20 25.10

- Deferred Tax (0.08) 0.01

Profit after tax 30.08 51.03

Add: Surplus brought forward 30.52 22.36

Total Amount available for

appropriation 60.60 73.39

LESS:

Interim Dividend (20%) paid on

equity shares 3.04 4.57

Tax on Interim Dividend 0.61 0.78

Transfer to General Reserve 30.00 30.00

Proposed Final Dividend on Equity Shares @ 30 % (Re. 0.30 per equity share on face value

of Re.1/- ) 4.57 6.85

Provision for tax on Dividends 0.93 0.67

Surplus carried Forward to balance sheet 21.45 30.52

OPERATIONS REVIEW:

Total income decreased from Rs.274.68 Crores in 2013-14 to Rs.259.88 Crores in 2014-15 - decrease of 5.39%. Profit after Tax was Rs.30.08 Crores (previous year : Rs.51.03 Crores).

With Fixed Assets of Rs.55 Crores, our Asset Turnover ratio is a healthy 4.67 with Return on Sales of 21.16%. Interest cost for the year is increased by Rs. 1.56 crore (0.98% of sales).

DIVIDEND:

Your Directors are pleased to recommend a final dividend of 30% on Equity Share Capital, for the year ended 31.03.2015, amounting to Rs 456.85 Lakhs, excluding dividend tax. During the year, the Board declared an Interim Dividend of 20%, amounting to Rs.304.57 Lakhs,

excluding dividend tax. The aggregate of dividend declared during the year was 50% amounting to Rs 761.42 Lakhs, excluding dividend tax.

TRANSFER TO GENERAL RESERVE

Your directors are pleased to transfer a sum of Rs.30 crore towards the General Reserve

SHARE CAPITAL

The paid up equity share capital as on 31st March 2015 was Rs.15.23 crore. During the year under review, the Company has neither issued share with differential voting rights nor granted stock options and sweat equity. The share holding of the Directors as on 31st March 2015 are given in the Corporate Governance report.

FINANCE

Cash and cash equivalents as at 31st March 2015 was Rs.1027.76 lakhs. The Company continues to focus on judicious management of its working capital, receivables, inventories and other working capital parameters and which were kept under strict check through continuous monitoring.

WIND MILL

The wind mill of the Company located at Kokkampalayam village, Dharapuram Taluk, Erode District, Tamil Nadu generated 8,01,130 units of electricity in the year 2014- 15 against 9,29,100 units generated in 2013-14. The Company had utilised the entire units generated as captive consumption during 2014-15.

BOARD MEETING

The Board consists of Mr. Ajit Thomas, Chairman, Mr. M.A. Alagappan, Independent Director, Mr. P. Shankar, Independent Director, Mr. Habib Hussain, Non-Executive Director, Mrs. Shanthi Thomas, Additional ( Non-Executive Director), Mr. Shyam B.Ghia, Independent Director (up to 19.3.2015) and Mr. M.S.A. Kumar, Managing Director (up to 31.3.2015)

The Board of Directors met five times during this financial year. The details of the Board meeting are given in the Corporate Governance report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

AUDIT COMMITTEE MEETING

The Audit Committee consists of Mr. M.A. Alagappan, Chairman, Mr. P. Shankar, Member, Mr. Habib Hussain, Member, Mr. Shyam B. Ghia, Member (up to 19.3.2015).

The Audit Committee of the Company met five times during

this financial year. The details of the Audit Committee meetings are given in the Corporate Governance report.

PARTICULARS OF LOANS, GUARANTEE OR INVESTMENTS:

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013 except the 'Corporate Guarantee' & 'Stand by Letter of Credit' given on behalf of AVT Tea Services Ltd., London, which is given in the notes No. 28 to the financial statements.

The details of investments made by the Company are given in the notes No. 12 & 14 to the financial statements.

LISTING WITH STOCK EXCHANGES:

The equity shares of the Company are continued to be listed in Bombay Stock Exchange Ltd., (BSE) and the National Stock Exchange of India Ltd., (NSE). The Company confirms that it has paid the annual listing fees for the year 2014-15 to both the stock exchanges.

During the year, the equity shares of the Company were delisted from the Madras Stock Exchange (MSE) with effect from 25th September 2014 by complying with the provisions of SEBI (Delisting of equity shares) Regulations 2009.

FIXED DEPOSITS:

The Company stopped accepting / renewing deposits with effect from 30th July 2012. As per the Companies Act 2013, the deposits accepted prior to the commencement of the Act, was required to be repaid within one year from the commencement of the Act. Accordingly, the Company has repaid the entire outstanding fixed and cumulative deposits to the deposit holders and there are no unclaimed deposits in the books of accounts of the Company as on 31st March 2015.

DSIR APPROVAL FOR IN-HOUSE R&D FACILITY AT BANGALORE

Department of Scientific and Industrial Research (DSIR), New Delhi, has accorded its approval for the In-house research and development facility of the Company located at Bangalore. This is in addition to the earlier approval of In- house R&D facility of South Vazhakulam, Aluva, Kerala.

DIRECTORS & KEY MANAGERIAL PERSONNEL:

i) Director retiring by rotation

In accordance with the provisions of Companies Act, 2013 and the Articles of Association of the Company, Mr. Habib Hussain, Director retires by rotation at the 29th Annual General Meeting and being eligible, offers himself for re-appointment.

ii) Woman Director

Mrs. Shanthi Thomas was appointed as an Additional Director with effect from 21st March 2015. Her appointment requires the approval of the members

at the ensuing Annual General Meeting. A notice has been received from one of the shareholders pursuant to section 160 of Companies Act, 2013 proposing her candidature, along with the prescribed fees. The necessary resolution for her appointment is being placed before the share holders for approval.

iii) Resignation of Directors

Mr. M.S.A. Kumar, Managing Director of the Company Resigned due to personal reasons, with effect from 31st March 2015 and he was relieved from the service of the Company on the said date.

Further, Mr. Shyam B. Ghia, Independent Director resigned from the Board with effect from 19th March 2015 due to personal reasons.

iv) Declaration from Independent Directors on Annual Basis

The Company has received necessary declaration from the Independent Directors of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6).

v) Key Managerial Personnel

The Board in its meeting held on 30.05.2014 appointed Mr. M.S.A. Kumar, Managing Director, Mr. A. Ramadas, Sr. Vice President & CFO and Mr. Dileepraj. P, Company Secretary as the Key Managerial personnel of the Company. Mr. M.S.A. Kumar resigned with effect from 31.03.2015. Mr. M.N. Satheesh Kumar, President & COO has been appointed as 'Manager' and is the Key Managerial Personnel from 01.04.2015

vi) Appointment of Independent Director

The Board in its meeting held on 29.05.2015 has appointed Mr. A.D. Bopana as the Independent Director of the Company for a period of 5 years. Necessary resolution is being placed before the members for their approval.

vii) Appointment of 'Manager'

The Board in its meeting held on 29.05.2015 has appointed Mr. M.N. Satheesh Kumar, President & COO as the 'Manager' under section 203 (1) of the Companies Act 2013 for a period of 2 years w.e.f. 01.04.2015. Necessary resolution is being placed before the members for their approval.

PERFORMANCE OF SUBSIDIARY / JOINT VENTURE / ASSOCIATE COMPANIES:

a) AVT Tea Services Ltd., London, UK (AVT TSL):

The present authorized share capital of the Company is Pound Sterling (GBP) 1.00 million (Rs.10 Crores

approx.). The paid up capital of the Company as on 31st March 2015 is Pound Sterling (GBP) 6.19 million (Rs 6.20 Crores approx.). AVT TSL is the marketing arm of your Company for de-caffeinated tea and instant tea. The AVT TSL recorded sales of Rs.43.14 Crores and loss of Rs.2.35 crores for the year 2014-15

b) AVT Tea Services North America, LLC., step down subsidiary

During the year AVT Tea Services Ltd., United Kingdom incorporated AVT Tea Services North America, LLC, under the laws of the State of Florida as its wholly owned subsidiary Company.

c) AVT Natural Pte. Ltd., Singapore :

The subsidiary performance includes the liquidation loss of Rs. 1.26 crores of its chinese subsidiary Company from November 2013 to January 2014.

d) Closure of AVT Natural Pte. Ltd., Singapore:

During the year the Company had decided to close down its wholly owned subsidiary M/s AVT Natural Pte Ltd, Singapore as it had become non operational due to closing down of its Chinese Subsidiary in line with changed global market conditions.

Liquidation of the Company is in progress.

e) Accounts of Subsidiaries:

Pursuant to Section 136 (1) (b) of the Companies Act, 2013, a copy of the audited financial statements of AVT Tea Services Ltd., London for the period ended 31.03.2015 & AVT Natural Pte. Ltd., Singapore, for the period ended 15.12.2014, the overseas subsidiaries of your Company shall be furnished to any shareholder on demand. The Consolidated financial statements audited by the statutory auditors of the Company have been attached to this Report.

f) Joint Venture / Associate Company

The Company does not have any Joint Venture / Associate Company

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars prescribed by the section 134 (3) (m) of the Companies Act 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo are furnished in the Annexure-I to this Report.

AUDITORS:

M/s. Suri & Co., Chartered Accountants, Chennai - 600017,

(Firm's Registration No. 004283S) are the Statutory Auditors of the Company.

As per Section 139 of the Companies Act 2013, their appointment needs to be ratified by the share holders in every Annual General Meeting. Yours directors recommends ratifying their appointment at the forthcoming AGM.

AUDITORS' REPORT

There are no qualifications or adverse remarks mentioned in the Auditors' report. The notes to accounts forming part of financial statements are self-explanatory and needs no further clarification.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Companies Act 2013, CSR Committee of the Board of Directors was formed to recommend

a. the policy on Corporate Social Responsibility (CSR) and

b. implementation of the CSR Projects to be undertaken by the Company as per the CSR Policy for consideration and approval by the Board of Directors.

Annual Report on CSR in the prescribed format is enclosed as Annexure - II. The CSR policy of the Company has been already uploaded in the web site: http://avtnatural. com/policy.html

Contents of CSR policy

The CSR policy of the Company was approved by the Board of Directors on 28.01.2015.

The Company's commitment to CSR projects and programs will be the focus on holistic development of host communities and create social, environmental and economic value to the society.

To Company's commitment to CSR projects and programs will be by investing resources into any of the following areas:

a) Development of Skilling among various sections of society

b) Development of Infrastructure

c) Empowerment of Women

d) Promotion of Health Care

e) Old age homes / day care facilities for Senior Citizens

f) Promotion of Education

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed Mr. V. Suresh, Practising Company Secretary (C.P No.6032), Chennai to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure — III and forms an integral part of this Report.

There is no secretarial audit qualification for the year under review.

INTERNAL AUDITORS

During the year under review, M/s. PKF Sridhar & Santhanam, Chartered Accountants, Chennai carried out the internal audit exercise of the Company and submitted their reports.

COST AUDIT REPORT

Cost Audit is not applicable to the Company as per the Companies ( Records & Audit) Rules 2014.

INSURANCE:

The Company continues to carry adequate insurance for all assets against unforeseeable perils.

RELATED PARTY TRANSACTIONS:

All transactions entered with related parties for the year under review were at arm's length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. No Material Related Party transactions i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party transactions to be provided under section 134 (3) (h) of the Companies Act 2013, in Form AOC -2 is not applicable

Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All related party transactions are placed before the Audit Committee and also the Board. Prior omnibus approval of the Audit Committee is obtained on yearly / quarterly basis for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted has been placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

The policy on Related Party Transaction as approved by the Board of Directors has been uploaded on the website of the Company and the website link is http://avtnatural. com/policy.html

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS.

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

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 is enclosed herewith as 'Annexure - IV'.

STATUTORY INFORMATION:

The information required under section 197 of Companies Act 2013 and pursuant to rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company have been given in the Annexure - V.

The information required under section 197 (12) of the Companies Act 2013 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the Company have been given in the Annexure - VI.

INDUSTRIAL RELATIONS

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

NOMINATION & REMUNERATION POLICY

The Board on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Managerial Personnel, Key Managerial Personnel and their remuneration etc.

Contents of Nomination & Remuneration Policy

The details of the contents of Nomination & Remuneration policy of the Company is provided in the Corporate Governance Report, forming part of the Directors Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has a Vigil Mechanism / Whistle Blower Policy in place pursuant to Section 177 (9) of the Companies Act 2013 and as per clause 49 of the listing agreement. The said policy is available in the website of the Company which can be accessed from the link - http://avtnatural. com/policy.html

RISK MANAGEMENT:

Pursuant to Section 134 (3) (n) of the Companies Act, 2013 and the clause 49 of the listing agreement, the Company had laid down the procedures to inform Board members about the risk assessment and mitigation procedures.

Mr. A. Ramadas, Sr. Vice President & CFO has been assigned the task of informing the Board about the various risks and its mitigation by the Company from time to time.

At present the Company has not identified any element of risk which may threaten the existence of the Company.

INTERNAL CONTROL SYSTEMS

The details of the internal control systems adopted by the Company are provided in the Management Discussion and Analysis Report, forming part of the Directors Report.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Company's policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances environmental regulations and preservation of natural resources.

BOARD EVALUATION

The performance of Board, its Committee and individual directors are evaluated by number of meetings held, time spent in each meeting deliberating the issues, statutory compliance, contribution of each director, the details of decision taken and measures adopted in implementing the decision and monitoring the continuous implementation of the decision and feed back to the Board.

DISCLOSURE OF ACCOUNTING TREATMENT

In the preparation of the financial statements, the Company has followed the Accounting Standards referred to in Section 133 of the Companies Act, 2013. The significant accounting policies which are consistently applied are set out in the Notes to the Financial Statements.

CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion & Analysis Report, Report on Corporate Governance with Auditors' Certificate on compliance with conditions of Corporate Governance have been annexed VII & VIII to this Report.

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

The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Act and that an Internal Complaints Committee has been set up for redressal of complaints and that all employees (permanent, contractual, temporary, trainees) are covered under this policy.

During the year the Company has not received any complaint under Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013

CAUTIONARY STATEMENT

Statements in this Directors' Report & Management Discussion and Analysis Report describing the Company's objectives, projections, estimates, expectations or predictions may be 'forward looking statements' within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Company's operations include raw material availability and its prices, cyclical demand and pricing in the Company's principle markets, changes in Government regulations, Tax regimes, economic developments within India and the countries in which the Company conducts business and other ancillary factors.

DIRECTORS' RESPONSIBILITY STATEMENT:

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

1. In the preparation of the accounts for the financial year ended 31st March 2015, the applicable accounting standards had been followed along with proper explanation relating to material departures;

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

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

4. The Directors have prepared the accounts for the financial year ended 31st March 2015 on a 'going concern' basis.

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

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

ACKNOWLEDGEMENT:

The Directors sincerely acknowledge the contribution and

support from customers, shareholders, farmers, Central and State governments, bankers, Securities Exchange Board of India, Bombay Stock Exchange Ltd, National Stock Exchange of India Ltd., Cameo Corporate Services Ltd., National Securities Depository Ltd., Central Depository Services Ltd., Registrar of Companies, Tamil Nadu and other government authorities for the co-operation and assistance provided to the Company.

The Directors also place on record their gratitude to the employees for their continued support, commitment, dedication and co-operation.

For and On behalf of the Board

Place : Chennai Ajit Thomas Date : 22nd July 2015 Chairman

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Mar 31, 2013

The Directors are pleased to present the Twenty Seventh Annual Report of the company together with the Audited Accounts for the financial year ended March 31, 2013.

FINANCIAL RESULTS:

The standalone performance of the Company for the financial year ended March 31, 2013 is summarized below:

(Rs. In Crores)

Particulars 2012-13 2011-12

Income from Operations 255.95 218.35

Other Income 0.11 0.56

Total Income 256.06 218.91

Profit before tax for the year 75.70 75.16

Less : Provision for taxation

- Current Tax 25.00 24.70

- Deferred Tax 0.13 0.04

Profit after tax 50.57 50.42

Add: Surplus brought forward 12.90 3.55

Total Amount available for

appropriation 63.47 53.97

Less:

Special Dividend (25%) on the occasion of silver jubilee of the

Company on Equity Shares 1.90

Interim Dividend (50%) paid on equity shares 3.81 3.81

Tax on Special Dividend 0.31

Tax on Interim Dividend 0.62 0.62

Transfer to General Reserve 30.00 30.00

Proposed Final Dividend on Equity Shares @ 75% (Re.0.75 per equity share on face value of Re.l/-) 5.71 3.81

Provision for tax on Dividends 0.97 0.62

Surplus carried Forward 22.36 12.90

OPERATIONS REVIEW:

Increased volumes of Marigold Food Grade Oleoresin (used in Eye Health segment), Spice Oils & Oleoresins (used in Food flavoring & coloring) and Decaffeinated Teas contributed to 17% increase in sales from Rs.219 Crores in 2011-12 to Rs.256 Crores in 2012-13. However Profit After Tax was flat at Rs. 50.57 Crores due to softening of Marigold Feed Grade Oleoresin (used for Poultry Pigmentation) prices in the global market (thanks to over production in China). After registering a five fold increase in Profit after Tax during

2011-12 (from Rs.10.81 Crores in 2010-11 to Rs.50.42 Crores in 2011-12), your company did well by maintaining Profit after Tax at the same level as last year. 2012 crop of Marigold was a record high due to a very favourable monsoon in growing areas.

Despite 17% increase in sales, working capital borrowing has come down from Rs.25.79 Crores as of 31st March 2012 to Rs.23.49 Crores as of 31st March 2013. Term loan outstanding as of 31st March 2013 is Rs.1.49 Crores which will be repaid during 2013/14. Thus it will be our endeavor to make your company a "Zero Debt" organization by 31st March 2014.

AWARDS:

Your company won three awards during the year under review: A FORBES ASIA UNDER A BILLION $ AWARD:

Your Company has been recognized by Forbes as one among 200 best companies from Asia-Pacific region under $ 1 billion revenue. The list published on August

18, 2012 is based on the financial data of the preceding 12 months. Those companies in Asia Pacific with sales of over US$ 5 Million and below US$ 1 Billion which are publicly traded with a positive net income are first short listed. Your company is one among 23 companies from India to find a place in this esteemed list of Asia''s Best 200. The list recognizes the importance of small and medium enterprises in powering the Asia-Pacific economy.

B. EXCELLENCE IN SPICES EXPORT AWARD:

Your company was selected for the "Certificate of Merit" by the Spices Board in recognition of our outstanding performance in the export of spices / spice products during the year 2010-11.

C. POLLUTION CONTROL BOARD AWARD - 2011:

Your Company''s plant at Cochin was awarded "Certificate of Merit" by Kerala State Pollution Control Board for securing second position among medium scale industries in making substantial and sustained effort towards pollution control in the year 2011.

DIVIDEND:

Your Directors are pleased to recommend a final dividend of 75% on Equity Share Capital, for the year ended 31.03.2013, amounting to Rs.571 Lakhs, excluding dividend tax.

During the year, the Board declared an Interim Dividend of

50 %, amounting to Rs.381 Lakhs, excluding dividend tax. The aggregate of dividend declared during the year was 125 % amounting to Rs. 952 Lakhs, excluding dividend tax. Thus for 2012/13, we have maintained same dividend of 125% as that of the last year.

SUBSIDIARY COMPANIES:

The company has the following subsidiaries:

AVT Natural Pte. Ltd., Singapore with its step down subsidiary, Heilongjiang AVT Bio-Products Limited, China:

The subsidiary recorded sales of Rs.10.82 Crores in 2012 as against the sales of Rs.25.66 Crores in 2011, showing a decline of 58%. The reduction in sales is on account of lower production and sales of Marigold Oleoresin (Feed Grade) and very low prices compared to 2011. The subsidiary companies incurred a loss of Rs.2.09 Crores in the period ended December 2012 as against a profit of Rs. 4.36 Crores during the same period last year.

AVT Tea Services Ltd., London, UK (AVT TSL):

During the year your company had set up this wholly owned subsidiary with an authorized capital of Pound Sterling (GBP)

0.50 million (approx. Rs.440 Lakhs) and the Company started functioning with effect from 13th August 2012. AVT TSL will be the global marketing arm of your company for de-caffeinated tea and instant tea. This would further strengthen the Company''s position in the Global Value Added Beverages market. AVT TSL commenced its operations during the year and recorded a sale of Rs.0.22 Crores as on

31.12.2012 and recorded a loss of Rs.0.68 Crores on account of administrative overheads.

ACCOUNTS OF SUBSIDIARIES:

Pursuant to Section 212 of the Companies Act, 1956, the Balance Sheet, Statement of Profit & Ix-ss, Director''s Report and the Auditor''s Report for the period ended 31st December 2012 for AVT Tea Services Ltd., London, an overseas subsidiary, AVT Natural Pte. Ltd., Singapore, another overseas subsidiary of your Company and its Chinese Subsidiary, Heilongjiang AVT Bio-Products Ltd., have been kept at the Registered Office of your Company for inspection by shareholders. The Company shall furnish a hard copy of the accounts to any shareholder on demand. The Consolidated financial statements audited by the statutory auditors of the Company have been attached to this Report.

FIXED DEPOSITS:

The Company had stopped accepting / renewing deposit with effect from 30th July 2012. As on 31.03.2013, a total sum of Rs.0.46 Lakh due to 3 fixed deposit holders remained unclaimed. The entire unclaimed deposits were repaid subsequendy. All matured deposits shall be paid on its maturity.

DIRECTORS:

In accordance with the provisions of Companies Act, 1956 and the Articles of Association of the Company, Mr. M.A. Alagappan, Director and Mr. Shyam B. Ghia, Director, retire by rotation at the 27 th Annual General Meeting and being eligible, offer them for re-appointment.

RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, ENERGY CONSERVATION:

The particulars prescribed by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 relating to Conservation of Energy, Technology Absorption, Foreign Exchange are furnished in the Annexure-I to this Report.

PARTICULARS OF EMPLOYEES:

Particulars of employees in terms of the requirement of Section 217 (2A) of Companies Act, 1956 have been given in the Annexure II forming part of this Report.

AUDITORS:

M/s. Suri & Co., Chartered Accountants, Chennai - 600 017, Auditors of die Company retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. They have confirmed that their re-appointment, if made, will be within the limits specified under Section 224 (1-B) of the Companies Act, 1956.

CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement widt the Stock Exchanges, the Management Discussion & Analysis Report, Report on Corporate Governance with Auditors'' Certificate on compliance with conditions of Corporate Governance have been annexed to this Report.

INSURANCE:

The Company continues to carry adequate insurance for all assets against foreseeable perils.

DIRECTORS'' RESPONSIBILITY STATEMENT:

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

1. That in the preparation of the accounts for the financial year ended 31st March 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures;

2. That the Directors have selected such accounting policies and applied them consistendy and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

4. That the Directors have prepared the accounts for the financial year ended 31st March 2013 on a ''going concern'' basis.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to thank and wish to place on record their sincere dianks and the appreciation for the continued co-operation and support extended to the Company by all die stake holders including share holders, depositors, customers, farmers, bankers, suppliers, stock exchanges etc.,

The Directors also wish to place on record their appreciation for the contribution, support and continued co-operation extended by the employees throughout the year.

For and On behalf of the Board

Place : Chennai Ajit Thomas

Date : 30th May, 2013 Chairman

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Mar 31, 2012

The Directors are pleased to present the Twenty Sixth Annual Report Of your Company together with the Audited Accounts for the financial year ended March 31, 2012.

FINANCIAL RESULTS:

The standalone performance of the Company for the financial year ended March 31, 2012 is summarized below:

(Rs. In Crores)

Particulars 2011-12 2010-11

Income from Operations 218.19 138.90

Other Income 0.56 0.15

Total Income 218.75 139.05

Profit before tax for the year 75.16 16.45

Less : Provision for taxation

- Current Tax 24.70 5.70

- Deferred Tax 0.04 (0.06)

Profit after tax 50.42 10.81

Add: Surplus brought forward 3.55 3.17

Total Amount available for appropriation 53.97 13.98

Less:

Special Dividend (25%) on the occasion of silver jubilee of the Company and Interim Dividend (50%) paid on Equity Shares To talling to 75% (Rs. 7.50 per equity share) 5.71 -

Tax on Interim Dividend 0.93 -

Transfer to General Reserve 30.00 6.00

Proposed Final Dividend on Equity Shares @ 50 % (Rs.5/- * per equity share on face value of Rs.10/- ) 3.81 3.81

Provision for tax on Dividends 0.62 0.62

Surplus carried Forward 12.90 3.55

* post split dividend per share shall be in proportion to sub-divided share.

OPERATIONS REVIEW:

Your company had an exceptional year in 2011-12. All three business units of Marigold, Spice Oils & Oleoresins and Value Added Beverages did exceptionally well beating all expectations.

- Sales grew by 57% from Rs. 138.90 Crores to Rs. 218.19 Crores.

- With the major benefit of doubled sales and prices in our key product of Marigold Oleoresins, Profit after Tax grew by 5 times from Rs. 10.81 Crores in 2010-11 to Rs. 50.42 Crores in 2011-12.

- Marigold Oleoresin sales value almost doubled from previous year (93% growth) with higher price realization for both Feed grade for Poultry usage and Food grade for human consumption. The average price doubled during the year due to global shortages arising from failed China crop.

- Favourable weather conditions supported by an excellent and timely Monsoon in Marigold growing areas in South India enabled your company to register record flower output.

- Spice Oils and Oleoresins sales registered a healthy growth of 39%.

- Earnings Per Share (EPS) jumped to Rs. 66.21 in 2011-12 from Rs. 14.20 in 2010-11.

The detailed Operational Performance of the Company including future prospects has been comprehensively discussed in the Management Discussion and Analysis Report which forms part of this Report.

DIVIDEND:

Your Directors are pleased to recommend a final dividend of 50% on Equity Share Capital, for the year ended 31.03.2012, amounting to Rs.380.71 lakh, excluding dividend tax.

During the year, the Board declared a special dividend of 25% on the occasion of the Silver Jubilee of the Company amounting to Rs. 190.36 lakh, excluding dividend tax. Further, in the month of March 2012, the Board declared an Interim Dividend of 50 %, amounting to Rs.380.71 lakh, excluding dividend tax. The aggregate of dividend declared during the year was 125 % amounting to Rs. 951.78 lakh, excluding dividend tax.

QUALITY, HEALTH, SAFETY AND ENVIRONMENT:

With the continued thrust of the Company in this critical area, your company is taking care of the triple bottom line concept People, Planet and Profit.

RECOGNITION OF IN HOUSE R&D UNIT:

The Department of Scientific & Industrial Research, Technology Bhavan, Under Ministry of Science & Technology has renewed its recognition to the in-House R&D facility of your company located at South Vazhakulam, Marampilly Post, Aluva, Kerala, for a further period of 4 years, from 1st April 2012 to 31st March 2016.

WIND MILL:

The wind mill of the company located at Kokkampalayam Village, Dharapuram Taluk, Erode District, Tamil Nadu generated 11,11,500 units in the year 2011-12 against 12,05,325 units generated last year. Out of the same, the Company had captive consumption of 9,98,984 units and the balance is being sold to the TNEB.

FIXED DEPOSITS:

As on 31.03.2012, a total sum of Rs. 10.05 Lakh due to 9 fixed deposit holders remained unclaimed. Out of this, deposits for a sum of Rs. 3 Lakh were renewed / repaid subsequently.

However, the Company had decided to stop accepting / renewing deposit with effect from 30th July 2012. All matured deposits shall be paid on its maturity.

SUB-DIVISION OF EQUITY SHARES:

In order to improve the liquidity, the equity shares of the Company have been sub-divided from face value of Rs.10/- to face value of Re.1/- each and consequently the authorized equity share capital is 7,99,00,000 equity shares of Re.1/- each.

PERFORMANCE OF SUBSIDIARIES:

AVT Natural Pte. Ltd., Singapore together with its subsidiary, Heilongjiang AVT Bio-Products Limited, China did very well in 2011 due to favorable Marigold market conditions. The subsidiary recorded sales of Rs.25.66 Crores in 2011 as against the sales of Rs.8.61 Crores in 2010 - growth of 3 times. Thanks to the good prices of Marigold Oleoresins, the subsidiary companies earned a record profit of Rs. 4.36 Crores in the period ended December 2011 as against a profit of Rs. 0.30 Crores during the same period last year.

ACCOUNTS OF SUBSIDIARIES:

Pursuant to section 212 of the Companies Act, 1956, the Balance Sheet, Profit & Loss Account, Director's Report and the Auditor's Report for the period ended 31st December 2011 for AVT Natural Pte. Ltd., Singapore, an overseas subsidiary of your Company and its Chinese Subsidiary, Heilongjiang AVT Bio-Products Limited, have been kept at the Registered Office of your Company for inspection by shareholders. The company shall furnish a hard copy of the accounts to any shareholder on demand. The Consolidated financial statements audited by the Statutory auditors of the Company have been attached to this Report.

DIRECTORS:

In accordance with the provisions of Companies Act, 1956 and the Articles of Association of the Company, Mr. Ajit Thomas, Chairman and Mr. P. Shankar, Director, retire by rotation at the 26th Annual General Meeting and being eligible, offer themselves for re-appointment.

RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, ENERGY CONSERVATION:

The particulars prescribed by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 relating to Conservation of Energy, Technology Absorption, Foreign Exchange are furnished in the Annexure-I to this Report.

PARTICULARS OF EMPLOYEES:

Particulars of employees in terms of the requirement of section 217 (2A) of Companies Act, 1956 have been given in the Annexure II forming part of this Report.

AUDITORS:

M/s. Suri & Co., Chartered Accountants, Chennai 600 017, Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. They have confirmed that their re-appointment, if made, will be within the limits specified under Section 224 (1-B) of the Companies Act, 1956.

CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion & Analysis Report, Report on Corporate Governance with Auditors' Certificate on compliance with conditions of Corporate Governance have been annexed to this Report.

INSURANCE:

The Company continues to carry adequate insurance for all assets against foreseeable perils.

DIRECTORS' RESPONSIBILITY STATEMENT:

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

1. That in the preparation of the accounts for the financial year ended 31st March 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures;

2. That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

4. That the Directors have prepared the accounts for the financial year ended 31st March 2012 on a going concern' basis.

ACKNOWLEDGEMENT:

Your Directors wish to express their sincere thanks and place on record the appreciation for the continued co-operation and support extended by the share holders, depositors, customers, farmers, bankers namely State Bank of India, Bank of Baroda, The South Indian Bank, CITI Bank, suppliers, stock exchanges and other stake holders for their continued support to the Company.

The Directors also wish to thank all the employees for their contribution, support and continued co-operation throughout the year.

For and On behalf of the Board Place : Chennai Ajit Thomas

Date: 30th May, 2012 Chairman

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Mar 31, 2011

Dear Members,

The Directors are pleased to present the Twenty Fifth Annual Report of your Company together with the Audited Accounts for the financial year ended 31st March 2011.

FINANCIAL RESULTS:

The standalone performance of the Company for the financial year ended 31st March 2011 is summarized below:

(Rs. In lakhs)

Particulars 2010-11 2009-10

Income from Operations 13890.37 8312.60

Other Income 14.58 35.10

Total Income 13904.95 8347.70

Profit before tax for the year 1644.88 1011.96

Less : Provision for taxation

- Current Tax 570.00 320.00

- Deferred Tax (6.60) 40.00

Profit after tax 1081.48 651.96

Add: Surplus brought forward 315.57 329.98

Total Amount available for appropriation 1397.06 981.94

Less:

Transfer to General Reserve 600.00 400.00

Proposed Dividend on Equity Shares @ 50 % 380.71 228.43 (Rs.5 per equity share)

Provision for tax on Dividends 61.76 37.94

Surplus carried Forward 354.58 315.57

OPERATIONS REVIEW:

Your Company has scaled new heights during the year under review. The key aspects of your Company's performance during the financial year 2010-11 are as follows:

- Sales of key product in the company's portfolio - Marigold Oleoresin - jumped by 52% during 2010-11.

- Turnover increased by 67% from Rs. 83.13 Crores in 2009-10 to Rs. 138.90 Crores in 2010-11.

- Profit After Tax increased by 66% from Rs. 6.52 Crores in 2009-10 to Rs. 10.81 Crores in 2010-11.

- Earnings Per Share (EPS) for the year increased by 66% from Rs. 8.56 in 2009-10 to Rs. 14.20 in 2010-11.

The detailed Operational Performance of the Company has been comprehensively discussed in the Management Discussion and Analysis Report which forms part of Directors' Report.

DIVIDEND:

The outstanding performance of the Company has enabled Directors to recommend a dividend of 50% (Rs.5 per equity share) on 76,14,200 Equity shares of Rs. 10 each for the year ended 31.3.2011.

PERFORMANCE OF SUBSIDIARY COMPANY:

AVT Natural Pte. Ltd., Singapore together with its subsidiary, Heilongjiang AVT Bio-Products Limited, China has recorded sales of Rs. 8.61 Crores and profit of Rs. 29.59 Lakhs in the period ended December 2010 against the sales of Rs.7.15 Crores and a profit of Rs. 20.41 Lakhs during the period ended December 2009. We expect an improved performance in sales and profits of the subsidiary company in 2011 from our Chinese operation due to increase in growing areas, higher flower output and better Marigold Oleoresin prices.

ACCOUNTS OF SUBSIDIARY COMPANY:

Pursuant to Section 212 of the Companies Act, 1956, the Balance Sheet, Profit & Loss Account, Director's Report and the Auditors Report for the period ended 31st December 2010 of AVT Natural Pte. Ltd., Singapore, overseas subsidiary of your company and its Chinese Subsidiary, Heilongjiang AVT Bio-Products Limited, have been kept at the Registered Office of your company for inspection by any share holder. The company shall furnish a hard copy of the accounts to any share holder on demand. The Consolidated financial statements audited by the Statutory auditors of the company have been attached to this Report.

QUALITY, HEALTH, SAFETY AND ENVIRONMENT:

At AVT Natural Products Limited (AVT NPL), Quality, Health, Safety and Environmental (QHSE) responsibilities are integral. AVT NPL has acquired International Standards ISO 9001:2008, ISO 22000 for HACCP and Kosher Certification by Circle U. As a part of its objective to improve quality, health, safety and environment in the work place and developing an Integrated Management System (IMS), we are currently working on ISO 14000:2004 for Environment, PAS 220 for GMP Certification and OHSAS 18001:2007. We are also preparing an "On Site Emergency Plan" for augmenting Plant Safety Standards.

FIXED DEPOSITS:

As on 31.03.2011, a total sum of Rs. 8.92 Lakhs due to 14 fixed deposit holders remained unclaimed. Out of this, deposits for a sum of Rs. 7.98 Lakhs were renewed / repaid subsequently.

RECOGNITION OF IN HOUSE R&D UNIT:

The Department of Scientific & Industrial Research, Technology Bhavan, Under Ministry of Science & Technology has accorded its recognition to the in-House, R&D facility of your company located at South Vazhakulam, Marampilly Post, Aluva, Kerala, which is valid up to the period ending 31st March 2012, will be renewed thereafter.

AWARDS AND ACCREDITATIONS:

During the year under review, your Company had won the "Second Prize" amongst Large Scale Industries of Kerala for 2009/10 instituted by the Kerala State Pollution Control Board. AVT Natural is winning this award second year in a row.

SHIFTING OF THE REGISTERED OFFICE OF THE COMPANY:

Pursuant to the resolution passed by the Board of Directors of the company at its meeting held on 29th April 2011, the registered office of the company has been shifted with effect from 12th May 2011 from No. 64, Rukmani Lakshmipathy Salai, Egmore, Chennai - 600 008, to No. 60, Rukmani Lakshmipathy Salai, Egmore, Chennai - 600 008.

WIND MILL:

The Company has set up a windmill project 600 KW WTG, Kokkampalayam Village, Dharapuram Taluk, Erode District, Tamil Nadu. The wind mill has started its commercial operation with effect from 27 September 2008. The wind mill generated 12,05,325 units in the year 2010-11 against 13,94,064 units in generated the year 2009-10. This output is as per our projections.

DIRECTORS:

In accordance with the provisions of Companies Act, 1956 and the Articles of Association of the Company Mr. Shyam B. Ghia, Director and Mr. Habib Hussain, Director, retire by rotation at this Annual General Meeting and being eligible, offer themselves for re-appointment.

RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, ENERGY CONSERVATION:

The particulars prescribed by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 relating to Conservation of Energy, Technology Absorption, Foreign Exchange are furnished in the Annexure-I to this Report.

PARTICULARS OF EMPLOYEES:

None of the employees of the Company is coming under the purview of Section 217(2A) of the Companies Act, 1956. Details of managerial remuneration under section 198 of the Act are furnished under the Note No. 9 (a) of Schedule 19 forming part of the Accounts.

AUDITORS:

M/s. Suri & Co., Chartered Accountants, Chennai 600 017, Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. They have confirmed that their re-appointment, if made, will be within the limits specified under Section 224 (1-B) of the Companies Act, 1956.

CORPORATE GOVERNANCE:

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion & Analysis Report, Report on Corporate Governance with Auditors' Certificate on compliance with conditions of Corporate Governance have been annexed to this Report.

INSURANCE:

The Company continues to carry adequate insurance for all assets against foreseeable perils.

DIRECTORS' RESPONSIBILITY STATEMENT:

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

1. That in the preparation of the accounts for the financial year ended 31st March 2011, the applicable accounting standards have been followed along with proper explanation relating to material departures;

2. That the Directors have selected such accounting policies and applied them consistendy and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

4. That the Directors have prepared the accounts for the financial year ended 31st March 2011 on a 'going concern' basis.

ACKNOWLEDGEMENT:

Your Directors wish to express their sincere thanks and place on record their appreciation for the continued co-operation and support extended by the share holders, depositors, customers, farmers, bankers namely State Bank of India, Bank of Baroda, The South Indian Bank, CITI Bank, suppliers, stock exchanges and other stake holders.

The Directors also wish to express their appreciation and to thank all the employees for their contribution, support and continued cooperation throughout the year.

For and On behalf of the Board

Ajit Thomas Chairman Place : Chennai Date : 22nd July 2011

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Mar 31, 2010

The Directors have pleasure in presenting their Twenty Fourth Annual Report together with the Audited Accounts of the Company for the year ended 31st March 2010.

FINANCIAL RESULTS

(Rs. In lakhs) 2009-10 2008-09

Turn Over 8297.33 8745.42

Other Income 35.09 51.88

Total Income 8332.42 8797.30

Profit before tax for the year 1011.96 1135.23

Less : Provision for taxation

- Current Tax 320.00 320.00

- Deferred Tax 40.00 101.20

- Fringe Benefit Tax Nil 12.00

Profit after tax 651.96 702.03

Add: Surplus brought forward 329.98 395.20 Total Amount available for

appropriation 981.94 1097.23

Less:

Transfer to General Reserve 400.00 500.00

Proposed Dividend on

Equity Shares @ 30% 228.43 228.43

Provision for tax on Dividends 37.94 38.82

Surplus carried Forward 315.57 329.98

OPERATIONS

During 2009-10, the Sales dropped to Rs.82.97 Crore from Rs 87.45 Crores of 2008-09. Profit After Tax dropped by 7.12 % from Rs 7.02 Crores in 2008-09 to Rs 6.52 Crores in 2009-10.

Spice Oleo sales and Value Added Beverages Sales were lower due to reduced global demand. Marigold Oleoresins, key ingredient in Eye Health Care and your companys main product line was not impacted as the demand compression did not occur in this segment.

Your company experienced margin pressures in all 3 product categories. Cost push in labour, power and fuel prices coupled with lower product prices dented the operating margins. With the increase in Agricultural commodity prices and increase in cost of cultivation, Marigold Farmers are demanding higher flower prices. Southern India experienced adverse weather conditions for Marigold crop growing resulting in lower flower output and lesser volumes through the plant. Thus margin pressures coupled with lower volumes resulted in 7.12% drop in PAT.

FUTURE PROSPECTS

The "Critical Global Strategic Partnership Agreement" signed with Kemin Health, L.C. (Kemin), Des Moines, Iowa,

USA last year for supply of Marigold Oleoresin is progressing as planned. Future volume of this product is expected to register around 5 to 10% annual growth rates. Kemin and AVT are working together in further strengthening the Lutein (Eye care ingredient from Marigold Oleoresin) supply chain in anticipation of the emerging global competition.

Spice Oils and Oleoresins demand is bouncing back with the start of the global economic recovery. Your company will continue its focus on "niche food safe" platform to increase the sales. The importing countries thrust on Food Safety will result in higher sales for this product group in future years.

Value Added Beverages - Decaffeinated Teas - will grow at a faster rate with addition of more customers and higher volumes. We expect to fill the second extraction plant volumes during next 3 to 5 years. Instant Teas is another product we are focusing on.

2010 Crop Season is progressing well. Good Summer showers and timely rains from South West Monsoon is helping the crop growth. We increased flower prices to meet the expectations of Farmers. We strengthened the Agricultural Operations Management systems. To mitigate risk of single season, your company now cultivates in Monsoon season as well apart from Summer. Thus we expect good flower output during 2010-11 thereby ensuring higher capacity utilization of the plant.

DIVIDEND

Your Directors are pleased to recommend a dividend of 30 % on Equity Share Capital for the year ended 31.03.2010.

PERFORMANCE OF SUBSIDIARY COMPANY

AVT Natural Pte. Ltd., Singapore together with its subsidiary, Heilongjiang AVT Bio-Products Limited, China has recorded sales of Rs 7.15 Crores and profit of Rs 20.41 Lakhs in the period ended December 2009 against the sales of 8.43 Crores and a profit of Rs 9.56 Lakhs during the period ended December 2008. We expect improved performance in sales and profits of the subsidiary company in 2010 from our Chinese operation due to increase in growing areas and higher flower output.

Pursuant to section 212 of the Companies Act, 1956, the Balance Sheet, Profit & Loss Account, Directors Report and the Auditors Report for the period ended 31st December 2009 for AVT Natural Pte. Ltd., Singapore, an overseas subsidiary of your company and its Chinese Subsidiary, Heilongjiang AVT Bio-Products Limited, have been attached.

FIXED DEPOSITS

As on 31.03.2010, a total sum of Rs 2.31 Lakhs due to 8 fixed deposit holders remain unclaimed. Out of this, deposits for a sum of Rs.1.22 Lakhs were renewed / repaid subsequently.

RECOGNITION OF IN-HOUSE R&D UNIT

The Department of Scientific & Industrial Research, Technology Bhavan, under Ministry of Science & Technology has accorded its recognition to the in-House, R&D facility of your company located at South Vazhakulam, Marampilly Post, Aluva, Kerala, for the period ending 31st March 2012, vide its letter No. F-TU-IV/RD/ 2976/2009 dated 18th March 2010.

WIND MILL

The Company had set up a windmill project 600 KW WTG, Kokkampalayam Village, Dharapuram Taluk, Erode District, Tamil Nadu. The wind mill has started its commercial operation with effect from 27th September 2008. The wind mill has generated 13,70,520 units in the year 2009-10. This output is as per our projections.

CLOSURE OF PLANT

During the year 2009-10, the company had closed its plant located at Hindupur. The said plant which was processing various grades of marigold flower, cultivated in and around that area and that the plant was running only 4 to 5 months a year depending on the flower arrival.

With the introduction of the Hybrid seeds at Sathyamangalam and Hassan cultivation area, the company was able to meet its requirement of Xanthophyll from these two areas. The Hindupur plant was set up in a lease hold land and its lease period had already expired, is being vacated by your company.

DIRECTORS

In accordance with the provisions of Companies Act, 1956 and the Articles of Association of the Company Mr. P. Shankar, Director and Mr. M.A. Alagappan, Director, retire by rotation at the 24th Annual General Meeting and being eligible, offer themselves for re-appointment.

RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, ENERGY CONSERVATION ETC.

The particulars prescribed by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988 relating to Conservation of Energy, Technology Absorption, Foreign Exchange are furnished in the Annexure-I to this Report.

PARTICULARS OF EMPLOYEES

Particulars of employees in terms of the requirement of section 217 (2A) Companies Act, 1956 have been given in Annexure II forming part of this Report.

AUDITORS

M/s. Suri & Co., Chartered Accountants, Chennai 600 017, Auditors of the Company retire at the conclusion of the

ensuing Annual General Meeting and being eligible, offer themselves for reappointment. They have confirmed that their re-appointment, if made, will be within the limits specified under Section 224 (1-B) of the Companies Act, 1956.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion & Analysis Report, Report on Corporate Governance with Auditors Certificate on compliance with conditions of Corporate Governance have been annexed to this Report.

DIRECTORS RESPONSIBILITY STATEMENT

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

1. That in the preparation of the accounts for the financial year ended 31st March 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures;

2. That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

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

4. That the Directors have prepared the accounts for the financial year ended 31st March 2010 on a going concern basis.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank and place on record their sincere appreciation for the continued co-operation and support extended by the share holders customers, farmers, bankers namely State Bank of India, Bank of Baroda, The South Indian Bank, CITI Bank, suppliers and other stake holders for their continued support to the Company.

The Directors also wish to place on record their appreciation for the contribution support and continued co-operation made by the employees.

For and On behalf of the Board

Ajit Thomas Chairman

Place : Chennai Date : 29th July, 2010