Directors Report of Grindwell Norton Ltd.

Mar 31, 2025

Your Directors are pleased to present the 75^th Annual Report of the Company along with the audited financial statements for the year ended March 31, 2025.

FINANCIAL HIGHLIGHTS

				(? crores)
	Standalone		Consolidated
	2024-25	2023-24	2024-25	2023-24
Sale of Products	2,510.35	2,403.80	2,584.70	2,438.45
Service & Other Operating Income	227.01	247.88	226.89	248.31
Revenue from Operations	2,737.36	2,651.68	2,811.59	2,686.77
Operating Profit	487.29	514.95	500.37	516.86
Finance Cost	(8.65)	(6.92)	(9.35)	(7.76)
Profit before share of profit/(loss) from Joint Venture	478.64	508.03	491.02	509.11
Share of profit/(loss) in Joint Venture	-	-	0.94	(0.42)
Exceptional loss	-	(3.20)	-	(0.35)
Provision for Tax	117.81	124.11	(120.70)	(124.38)
Profit for the year	360.83	380.72	371.27	383.96
Other Comprehensive Income (Net)	17.62	24.88	17.65	24.84
Total Comprehensive Income for the year	378.45	405.60	388.91	408.80
Share of Non-controlling Interest	-	-	(2.55)	(0.32)
Total Comprehensive Income attributable to owners	378.45	405.60	386.37	408.48

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of ''17/- per equity share of the face value of ?5/- each for the financial year ended March 31, 2025. The dividend on equity shares, if approved by the Members, would involve a cash outflow of ?188.22 crores (previous year ?188.22 crores).

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to the reserves.

OPERATIONS

The Indian economy continued to perform well with an estimated growth of 6.5% during the financial year 2024-25. Despite the geo-political stress, tariff and trade related uncertainties, India''s strong domestic demand, infrastructure push and strong service exports ensured economic stability and growth. Overall, the industrial sector, which includes manufacturing, is estimated to grow by 4.2% in the financial year 2024-25, driven by robust growth in electricity and construction. Reflecting this, your Company''s consolidated revenue from operations increased by 4.65% and operating profit declined by 3.2% due to increase in input costs.

ABRASIVES

The demand from the core industries as well as Retail market was lower during the financial year 2024-25 due to lower demand and global market conditions. The business continued to witness competitive pressure from the low cost imports from China. New Products helped the business grow sales by 3%, however the operating profit was lower by 5% due to an increase in the input & other costs that couldn''t be fully neutralized by price increases.

The business continues to build deeper engagement with customers across channels to identify growth opportunities within the core as well as in the emerging segments. The business will offer innovative solutions and new products to the customers and focus

on reducing the manufacturing cost. Abrasives business will also focus on simplification, digitalization, delayering & value stream mapping.

CERAMICS & PLASTICS

The Performance Ceramics and Refractories (“PCR”) had good domestics sales mainly due to increased offtake from segments like Iron & Steel & Carbon black, however exports declined mainly due to uncertain geopolitical situation. The growth in Performance Polymer Solutions business was mainly due to improved demand in automotive sector. While there has been an increase in the input cost, a better product mix helped to maintain the margins. For the Silicon Carbide business, while the volume had grown, the profit declined due to an increase in input cost. Overall, the consolidated sales of Ceramics and Plastics increased by 8%, the operating profit declined by 4% due to higher costs.

DIGITAL SERVICES & OTHERS

The Captive IT Development Centre (INDEC) had a relatively flat year with revenues declining by 3% while Margins were impacted by unfavourable exchange rate and costs.

SUBSIDIARY COMPANY/JOINT VENTURE/ASSOCIATE/OTHER INVESTMENTS SUBSIDIARY

The Company has a subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited (“SGCMBPL”). During the year the Company had a stable production environment and witnessed significant increase in its sales and profits compared to previous years. In terms of sub-regulation (1) (c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) SGCMBPL is not a material subsidiary.

JOINT VENTURE

The Joint Venture Company in Gujarat, Advanced Synthetic Minerals Private Limited (''ASMPL'') had stable business operations during the financial year 2024-25.

ASSOCIATE COMPANY

The Company''s strategic investment in Cleanwin Energy Three LLP to procure wind-generated green energy for its Mora Plant enhanced cost efficiency and reinforced its commitment towards sustainability.

In accordance with Section 129(3) of the Companies Act, 2013 (“Act”), Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements (incorporating the financial results of the subsidiary companies and Joint Venture), which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary companies and Joint Venture are also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary have been placed on the website of the Company, https://www.grindwellnorton.co.in/investors/reports#ReportsTabs2.

OTHER INVESTMENTS

The Company signed an agreement with Radiance MH Sunrise Thirteen Private Limited during the financial year to procure 2.32 MW Solar Power for sourcing of green energy through group captive consumption, which will result in enhanced cost efficiency and promotion of sustainability.

FUTURE PROSPECTS

Grindwell Norton Limited is managed by a highly experienced and exceptionally committed team that receives strong and continuous support from the parent company. The company has a strong R&D and works closely with customers to offer solutions to the various needs.

Looking ahead, India''s economic prospects for FY26 appear somewhat mixed. On the one hand, there are headwinds due to increased geopolitical and trade uncertainties while on the other, this could also open up more opportunities for India. Domestically, inflation is low, the Reserve Bank is expected to ease monetary policy to stimulate growth and one expects investments in new capacities by Private sector, all leading to growth. Rural demand backed by a rebound in agricultural production, an anticipated easing of food inflation and a stable macro-economic environment provides an upside to near-term growth.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR

There were no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

Grindwell Norton has always focused on developing and nurturing its human resources by fostering well-being, diversity, inclusion, and equal opportunities. Your Company emphasizes meritocracy and active skill development while encouraging societal contributions, creating an environment that balances innovation and consistency.

Striving to lead its industry, your Company prioritizes employee capability enhancement through robust training programs, transparent performance evaluations, and best-in-class hiring practices. With harmonious employee relations across all work sites, the Company had 2,429 permanent employees as of the financial year''s end, with no complaints regarding violations of the Company''s code of conduct reported during this period.

The Company is committed to providing a fair and inclusive workplace that inspires innovation, high performance, and employee growth. It invests in career development through diverse opportunities, benchmarking, and best practices. Continuous focus is placed on training in areas such as Environment, Health and Safety, and World Class Manufacturing to help employees realize their full potential.

The Company is in compliance with all employee benefit legislations. The relevant details are given in the Business Responsibility and Sustainability Reporting forming part of the Annual Report.

Promoting a culture of innovation, quality, efficiency, and sustainability, Grindwell Norton remains steadfast in delivering value to customers and end-users, while nurturing personal and professional development across its workforce. This approach solidifies its position as a market leader contributing meaningfully to its industry.

PREVENTION OF SEXUAL HARASSMENT

The Company is committed to fostering and upholding a positive work environment free from any kind of discrimination and harassment. The Company firmly believes that all employees have the right to be treated with dignity and respect, and it maintains a zero-tolerance policy towards any violations of its Code of Conduct and any form of harassment. To effectively address and resolve sexual harassment concerns or issues, the Company has an Internal Complaints Committee (“ICC”) in place in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013. During the year, one complaint was received on sexual harassment, which was investigated, addressed and disposed of in accordance with the established grievance redressal process of the Company. No Sexual Harassment complaint was pending as at the close of the Financial Year.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 of this Report. Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy workplace at all plant locations and work sites. The Company adheres strictly to the Environment, Health, and Safety Charter, policies, and procedures established under the Saint-Gobain Group.

The Company''s plants have been certified under ISO 9001, ISO 14001, and ISO 45001. These certifications and various awards acknowledge the efforts put in and outcome achieved in enhancing the Environment, Health and Safety (“EHS”) across all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (“Rules”) is annexed as Annexure 2(A) to this Report. The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the above Rules, is provided in Annexure 2(B) forming part of this Report.

PUBLIC DEPOSITS

The Company has not accepted any public deposits, and thus, there were no outstanding amounts due on account of principal or interest on public deposits as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL Cessation/Retirement

Mr. B. Santhanam, Managing Director of the Company retired with effect from March 31, 2025. The Board of Directors place on record their appreciation for the outstanding contribution made by Mr. B. Santhanam as Managing Director of the Company and during his long association with the Saint-Gobain group. Under his dynamic leadership, your Company has witnessed significant growth in its operations that will help drive the next phase of growth and innovation.

Mr. Jean-Claude Lasserre (Director Identification No. 10082026), Non-Executive Director of the Company relinquished his position effective May 9, 2025, owing to his other professional commitments. The Board of Directors placed on record their appreciation for the valuable contribution made by Mr. Jean-Claude Lasserre, during his tenure as a Director.

Appointment/Re-appointment

As per the Companies Act, 2013 (“Act”) and the Articles of Association of the Company, Mr. Aakil Mahajan (Director Identification No. 09682529), Non-Executive Director will retire by rotation, and being eligible, he has offered himself for re-appointment. The Board of Directors recommends his re-appointment and a resolution seeking members approval, along with other essential details, is included in the Notice.

Consequent to the retirement of Mr. B. Santhanam as Managing Director effective March 31, 2025, the Board of Directors in their meeting held on February 20, 2025 appointed Mr. Venugopal Shanbhag (Director Identification No. 08888359), Executive Director, as the Managing Director of the Company for a period of five (5) years with effect from April 1, 2025 up to March 31, 2030. His appointment was approved by the Members by way of Postal Ballot on March 27, 2025.

The Board of Directors, in their meeting held on February 20, 2025 appointed Mr. Hari Singudasu (Director Identification No. 10455516), Chief Financial Officer, as an Additional Director with effect from April 1, 2025. At the same meeting, the Board also appointed him as a ''Whole-Time Director designated as Executive Director'' of the Company for a period of five (5) years with effect from April 1,2025 up to March 31,2030. His appointment was approved by the Members by way of Postal Ballot on March 27, 2025.

The Board of Directors, in their meeting held on May 9, 2025, has appointed Ms. Stephanie Billet (Director Identification No. 11082284), as an Additional, Non-Executive Director with effect from May 10, 2025, liable to retire by rotation. The Board recommends her appointment and a resolution seeking members'' approval, along with other essential details, is included in the Notice.

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2025 and as on May 9, 2025 are:

Name	Designation
Mr. B. Santhanam	Managing Director (retired effective 31 March, 2025)
Mr. Venugopal Shanbhag	Managing Director (appointed effective 1 April, 2025)
Mr. Hari Singudasu	Executive Director (appointed effective 1 April, 2025)
Mr. K. Visweswaran	Company Secretary

Consequent to Mr. Hari Singudasu stepping down as Chief Financial Officer of the Company with effect from May 9, 2025, the Board of Directors at its meeting held on May 9, 2025, appointed Mr. Prakash Sabarad as Chief Financial Officer of the Company with effect from May 10, 2025.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

All the independent Directors have given the requisite declaration that they meet the criteria of independence as laid down under sub-section (6) of section 149 of the Companies Act, 2013.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the familiarisation programme is to acquaint the Independent Directors with the Company''s business model and the industry in which it operates. Details of the familiarisation programme are accessible on the Company''s website, https://www.grindwellnorton.co.in/investors/corporate-governance#FamiliarisationTabs3. Furthermore, the Independent Directors are periodically briefed on the latest developments in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company''s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation. During the year, six board meetings and one meeting of Independent Directors were held. The maximum interval between the board meetings did not exceed the period stipulated under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

The Board has constituted or reconstituted its committees in compliance with the Act and Regulation 18 to 21 of the Listing Regulations during the year. The Committees currently in place are the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee. The Corporate Governance Report provides information about the Committees, their composition, meetings and other relevant details.

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the financial year ended on March 31, 2025, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2025, and of the profit of the Company for the year ended on that date;

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

iv. that the annual financial statements have been prepared on a ''going concern'' basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively. With reference to the point number (v), the Board believes that the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFCs are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as the business evolves. The Company has established a mechanism to consistently detect such deficiencies and implement updated or enhanced controls wherever the potential impact of such gaps on the Company''s operations is significant.

DIRECTORS'' APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors'' appointment and remuneration. These are set out in the Policy for Appointment of Director, Key Managerial Personnel (“KMP”) and Senior Management Appointment Criteria, Performance Evaluation and Removal which is annexed as Annexure 3 to this Report and is also accessible on the Company''s website at https://www.grindwellnorton.co.in/investors/corporate-governance#PoliciesTabs7.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee has adopted a framework for performance evaluation of the Board, its committees, individual directors, and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of Board functioning, the composition of Board and its committees, culture, execution and performance of specific duties, obligations and governance. The evaluation parameters are based on the execution of specific duties, quality, deliberation at the meeting, independence of judgement, decision making, the contribution of Directors at the meetings and functioning of the Committees. The performance of the Board, its committees, individual directors, and chairperson was assessed by the Nomination and Remuneration Committee and the Board. In addition, the Independent Directors conducted an evaluation of the performance of Non-Independent Directors, Chairperson, and the Board as a whole. The Board of Directors also appraised the performance of the Independent Directors, their fulfillment of independence criteria specified by the Act and Listing Regulations, and well as their independence from management. The Director being evaluated did not participate in the evaluation process.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, no material related party transactions were entered by your Company. Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee. The policy on related party transactions, as approved by the Board, is available on the website of the Company, https://www.grindwellnorton.co.in/investors/corporate-governance#PoliciesTabs7.

There are no transactions that are required to be reported in Form AOC-2. The details of the transactions with related parties pursuant to Ind AS-24 are provided in the accompanying financial statements.

The objective of your Company''s Corporate Social Responsibility (''CSR'') initiatives is to improve the quality of life of communities through long-term value creation for all stakeholders. The Company''s CSR policy provides guidelines to conduct CSR activities of the Company. The salient features of the Policy forms part of the Annual Report on CSR activities annexed to the Board''s Report. The CSR policy is available on the website of the Company at https://www.grindwellnorton.co.in/investors/corporate-governance#PoliciesTabs7. For decades, the Company has pioneered various CSR initiatives. The Company continues to address societal challenges through societal development programs and remains focused on improving the quality of life. The Annual Report on CSR activities, in terms of Section 135 of the Companies Act, 2013 and the Rules framed thereunder, is annexed to this Report (Annexure 4).

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

The Board of the Company has been entrusted with the responsibility in:

(a) overseeing and approving the Company''s enterprise wide risk management framework; and

(b) ensuring that all material Strategic and Commercial Risks, Safety and Operational Risk, Compliance and Control Risks and Financial risks have been identified, assessed and that adequate risk mitigation measures are in place, to address these risks.

The Company''s management systems, organizational structure, processes, standards, code of conduct and behaviors together form the Group''s Risk Management System that governs how the Company conducts the business and manages associated risks. The Risk Management Framework is founded on sound organization principles.

The Company has identified elements of risk across all risk categories, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company''s Internal Financial Control systems are commensurate with the nature of its business, financial statements, and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow-up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company believes in conducting its business in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. The Company has framed and adopted Principles of Conduct and Action which governs the conduct of employees of the Company. Any actual or potential violation of the Company''s rules, regulations and policy governing the conduct of business is a matter of serious concern for the Company. The Company is therefore committed to developing a culture where it is safe for employees to raise concerns about instances if any, where such rules, regulations and policy are not being followed or any fraud has been committed or business has been conducted in an unethical manner. Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and to encourage employees and others to report unethical, unlawful or improper practices, acts or activities including a leak or suspected the leak of Unpublished Price Sensitive Information and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith. The Whistle Blower Policy is accessible on the website of the Company, https://www.grindwellnorton.co.in/investors/ corporate-governance#PoliciesTabs7.

AUDITORS Statutory Auditors

M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No. 104607W / W100166) were appointed as Statutory Auditors of your Company at the 72^nd AGM of the Company held on July 29, 2022, till the conclusion of the 77^th AGM of the Company. The Statutory Auditors have confirmed they are not disqualified from continuing as Auditors of the Company.

Cost Auditors

In accordance with Section 148 of the Act and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on the recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ending March 31, 2025. M/s. Rao, Murthy & Associates, Cost Accountants, have under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for the appointment. In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board of Directors has to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board of Directors seeks your support in approving the proposed remuneration of ?3,25,000/- (Rupees three lakhs twenty five thousand only) plus taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2026. M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years.

Secretarial Auditor

As per Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), as amended, provisions of Section 204 and other applicable provisions of the Companies Act, 2013, read with Rule 9 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) every listed entity is required to conduct a Secretarial Audit and annex the Secretarial Audit Report to its annual report and must also appoint a Secretarial Auditor for (5) five consecutive years with shareholders'' approval, to be obtained at the Annual General Meeting.

In accordance with Regulation 36(5) of Listing Regulations, and based on the recommendation of the Audit Committee, the Board of Directors, in their meeting held on May 9, 2025, has approved the appointment of M/s. Parikh & Associates, a Firm of Company Secretaries in Practice (Firm registration number: P1988MH009800), as the Secretarial Auditors to hold office for an audit period of five (5) consecutive years commencing from the financial year 2025-26 till financial year 2029-30 at a remuneration of ''1,00,000/-(Rupees one lakh only) plus applicable taxes and other out-of-pocket costs incurred in connection with the audit. The proposed fee is determined based on the scope of work, team size, industry experience, and the time and expertise required by M/s. Parikh & Associates to conduct the audit effectively. M/s. Parikh & Associates, Company Secretaries, possesses comprehensive professional experience in the field of Corporate Law, SEBI Regulations, FEMA Compliance and allied fields, delivering strategic solutions to ensure regulatory adherence and operational efficiency. The firm has been Peer Reviewed (Peer review certificate number 1129/2021) and Quality Reviewed by the Institute of Company Secretaries of India (ICSI), ensuring the highest standards in professional practices.

Comments on Auditors'' Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Kalyaniwalla & Mistry LLP, Statutory Auditors, in their Auditors'' Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report The Auditors have not reported any incidence of fraud to the Audit Committee of the Company in the year under review.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014 as amended, the Annual Return as on March 31, 2025 is accessible on the Company''s website https://www.grindwellnorton.co.in/investors/reports#ReportsTabs2.

DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors'' Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this Report. As per Regulation 34 of the Listing Regulations, a Business Responsibility and Sustainability Report is attached and is a part of this Annual Report.

The Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board of Directors in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 of this Report and is also accessible on the Company''s website, https://www.grindwellnorton.co.in/investors/corporate-governance#PoliciesTabs7.

SECRETARIAL STANDARDS AND COMPLIANCE

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operating effectively. The Company has complied with relevant compliances relating to Foreign Exchange Management Act, 1999.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company''s operations in the future.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the unwavering support and collaboration of the employees and bankers, and the loyalty of the large family of the Company''s dealers, suppliers and esteemed shareholders.

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Mar 31, 2024

The Directors are pleased to present the 74^th Annual Report of the Company along with the audited financial statements for the year ended March 31, 2024.

FINANCIAL HIGHLIGHTS

	Standalone		(Rs. Crores) Consolidated
	2023-24	2022-23*	2023-24	2022-23
Sale of Products	2,403.80	2,330.48	2,438.45	2,348.20
Service & Other Operating Income	247.88	193.27	248.32	193.14
Revenue from Operations	2,651.68	2,523.75	2,686.77	2,541.34
Operating Profit	514.95	498.37	516.87	495.56
Finance Cost	(6.92)	(7.53)	(7.76)	(7.80)
Profit before share of profit/(loss) from Joint Venture	508.03	490.84	509.11	487.76
Share of profit/(loss) in Joint Venture	-	-	(0.42)	(186)
Exceptional loss	(3.20)	-	(0.35)	-
Provision for Tax	(124.11)	(124.93)	(124.38 )	(124.38)
Profit for the year	380.72	365.91	383.96	361.52
Other Comprehensive Income (Net)	24.88	6.88	24.84	6.82
Total Comprehensive Income for the year Share of Non-controlling Interest Total Comprehensive Income attributable to owners	405.60	372.79	408.80 (0.32)	368.34 0.38
	405.60	372.79	408.48	368.72

* figures of the previous period have been restated with effect from May 27, 2022, to give effect to the Merger by Absorption between the Company and PRS Permacel Private Limited.

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of ?17/- per equity share of the face value of ?5/- each for the financial year ended March 31, 2024. The dividend on equity shares, if approved by the Members, would involve a cash outflow of ?188.22 crores, as against the cash outflow of ?160.54 crores in the previous year.

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to the reserves.

OPERATIONS

The Indian economy continued to perform well with an estimated growth of 7% to 7.3% during the financial year 2023-24. The growth in the Indian economy has been principally led by strong domestic demand and capital formation, however the private sector investment continued to be low. Despite, the global uncertainties, the services sector exports showed a robust growth. While the geo-political conditions affected the manufacturing for exports, the reduction in imports (due to low priced Russian oil) reduced the imbalance in the trade account deficit compared to previous year. The Index for Industrial Production (“IIP”) witnessed a growth of 6.1% in the financial year 2023-24. While the core industries grew reasonably well, export oriented segments had big impact due to geo-political situation. Reflecting this, your Company''s consolidated revenue from operations and operating profit (restated) posted a modest growth of 5.7% and 4.3% respectively.

ABRASIVES

The demand from end user segments like Auto, Auto Components, steel and foundry was consistent throughout the year. While the fundamentals remain strong there were some segments where customers faced headwinds due to lack of demand from Western countries and intense price pressure due to Chinese competition. The business also witnessed competitive pressure from the large global players. The improved product-mix, gain in market share and continued control over cost helped the business grow sales and operating profit by modest 6.2% and 7.3% respectively.

CERAMICS & PLASTICS

The Performance Ceramics and Refractories (“PCR”) business witnessed modest growth. The improved operating efficiencies and higher sales volume helped to increase the operating margin. The steep fall in the demand of Life Science segment has impacted the performance of Performance Plastics business. While there has been increase in the input cost, better product mix helped to maintain the margins. The Silicon Carbide business witnessed improved volumes, however, lower sales realization resulted in reduction in operating margins. With the easing of COVID curbs in Bhutan, there was an overall increase in the output of the plant. While the overall sales of Ceramics and Plastics segment grew by 3.7% the operating profit lowered by 8.9% over previous year.

DIGITAL SERVICES & OTHERS

The Captive IT Development Centre (“INDEC”) had a stable year. The Digital Services segment witnessed a normal increase in revenue in 2023-24, which is in line with the expectations.

SUBSIDIARY COMPANY/JOINT VENTURE/ASSOCIATESUBSIDIARIES

The Company has a subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited (“SGCMBPL”). With COVID restrictions constraint not being there, the operations were stable. In terms of sub-regulation (1)(c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) SGCMBPL is not a material subsidiary.

The National Company Law Tribunal (“NCLT”), Mumbai bench had approved the Scheme of Merger by Absorption between PRS Permacel Private Limited (“Permacel”), wholly-owned subsidiary, and your Company under section 230-232 of the Companies Act, 2013 vide an order dated June 22, 2023. Pursuant to this order all the assets and liabilities of Permacel, were transferred and vested in your Company at fair value with effect from May 27, 2022, being the appointed date.

JOINT VENTURE

During the year, the Company executed Share Sale and Purchase agreement (“Agreement”) with Shinagawa Refractories Co. Ltd. (Japan), for sale of 49% equity shares held by the Company in SG Shinagawa Refractories India Private Limited (“SGSR”) for a consideration of ?8 crore. The closing conditions pertaining to the said Agreement were concluded on November 30, 2023 and SGSR ceased to be a Joint Venture of the Company as on that date.

During the year, the Company subscribed 49% equity stake at a net consideration of ?15 crores in Advanced Synthetic Minerals Private Limited.

The consolidated financial highlights provided above include details of the Company''s subsidiary and Joint Ventures.

ASSOCIATE COMPANY

From a sustainability perspective, the Company invested in Cleanwin Energy Three LLP to procure green energy through wind power for its Mora Plant. This investment was beneficial in terms of cost optimization and enhanced sustainability.

In accordance with Section 129(3) of the Companies Act, 2013 (“Act”), Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements (incorporating the financial results of the subsidiary companies and Joint Venture), which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary companies and Joint Venture are also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary have been placed on the website of the Company, www.grindwellnorton.co.in/investor-information>Annual Reports.

FUTURE PROSPECTS

While the global geo-political and economic situation could bring in uncertainties, the overall economic growth in general and industrial growth in particular is neutral to positive. India''s strong infrastructure push, logistics development and industrial corridor development will contribute significantly to raising industrial competitiveness and boosting future growth. Improvement in household consumption, bright prospects for capital formation, owing to an upturn in private capex cycle, improved business sentiments, healthy balance-sheets of banks and corporates and the government''s continued thrust on capital expenditure to drive growth will propel the economic growth. Your Company''s management will focus on growth led by new products and new markets. While the geopolitical tensions and climate shocks could bring in short term risk, the Directors and the Company''s Management have immense confidence in your Company''s future.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR

There were no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

The Company''s primary focus is to provide a professional work culture that fosters innovation, ensures high performance, and empowers employees to grow and develop individually. The Company strives to become a leader in all the businesses it operates in and places a strong emphasis on enhancing employee capabilities through training. The hiring and onboarding practices of the Company adhere to the best industry standards, and a fair and transparent performance evaluation process is followed. To improve organizational efficiency, employee engagement, and skill levels, the Company encourages participation in various training programs and mandatory e-learning courses. More generally, employee relations were cordial and productive at all sites of your Company. At the end of the financial year, there were 2524 permanent employees on the rolls of the Company.

PREVENTION OF SEXUAL HARASSMENT

The Company is dedicated to establishing and maintaining a positive work environment that is free from any kind of discrimination or harassment. The Company firmly believes that all employees have the right to be treated with dignity and respect, and it maintains a zero-tolerance policy towards any violations of its Code of Conduct, particularly with regards to sexual harassment. To address any such issues, the Company has an Internal Complaints Committee (“ICC”) in place in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013. One (1) complaint was received during the year on sexual harassment, which was investigated, addressed and disposed in accordance with the established grievance redressal process,

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 of this Report. Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy workplace at all plant locations and work sites. The Company adheres strictly to the Environment, Health, and Safety Charter, policies, and procedures established under the Saint-Gobain Group.

The Company''s plants have been certified under ISO 9001: 2015, ISO 14001:2015 and ISO 45001:2018. These certifications and various awards acknowledge the efforts put in and outcomes achieved in enhancing the Environment, Health and Safety (“EHS”) across all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Companies Act, 2013 (“Act”) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (“Rules”) is annexed as Annexure 2(A) to this Report. The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the above Rules, is provided in Annexure 2(B) forming part of this Report.

PUBLIC DEPOSITS

The Company has not accepted any public deposits, and thus, there were no outstanding amounts due on account of principal or interest on public deposits as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL CESSATION/RETIREMENT

Mr. Keki Elavia (Director Identification No. 00003940) was re-appointed as an Independent, Non-Executive Director at the Annual General Meeting (“AGM”) of the Company held on July 25. 2019, for second term of five (5) consecutive years. As per the provisions of the Listing Regulations, Mr. Keki Elavia as an Independent, Non-Executive Director will be completing his second term and he will retire from the Board of the Company at the ensuing AGM. The Board of Directors placed on record their deep appreciation for the enormous contributions made by Mr. Keki Elavia, as an Independent, Non-Executive Director and Chairman of the Company. The Company and the Board benefitted immensely from Mr. Keki Elavia''s vast experience, knowledge and insights.

Mr. Krishna Prasad (Director Identification No. 00130438), Whole-Time Director designated as Executive Director of the Company retired with effect from May 6, 2024. The Board of Directors placed on record their appreciation for the substantial contribution made by Mr. Krishna Prasad for over 34 years, out of which seven (7) years as an Executive Director. Under his strong leadership, the Ceramics and Plastics business has witnessed robust and sustained growth and success.

Mr. Deepak Chindarkar, Chief Financial Officer of the Company retired with effect from December 31,2023. The Board of Directors placed on record their appreciation for the significant contribution made by Mr. Deepak Chindarkar for over 37 years to the Company.

APPOINTMENT/RE-APPOINTMENT

As per the Companies Act, 2013 (“Act”) and the Articles of Association of the Company, Mr. David Eric Molho (Director Identification No.09326249), Non-Executive Director will retire by rotation and has been eligible and offered himself for re-appointment. The Board of Directors recommends his re-appointment and a resolution seeking Members approval, along with other essential details, is included in the Notice.

Mr. Subodh Nadkarni (Director Identification No. 00145999) was appointed as an Independent, Non-Executive Director of the Company at the AGM held on July 24, 2020, for a term of five consecutive years commenced from July 25, 2019 up to July 24, 2024. The Board of Directors, on the recommendation of the Nomination and Remuneration Committee and in accordance with the provisions of the Act, Rules and Listing Regulations, recommends his re-appointment as an Independent, Non-Executive Director, for a second term of five (5) consecutive years effective from July 25, 2024 up to July 24, 2029, not liable to retire by rotation, subject to approval of the Members at the ensuing AGM of the Company by way of Special Resolution. Mr. Subodh Nadkarni has wide experience in the fields of Finance, Commerce, Project management, Human resources and General management and his re-appointment will immensely benefit your Company. The Board of Directors recommends his re-appointment and a resolution seeking Members approval, along with other essential details, is included in the Notice.

Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors, in accordance with the provisions of the Act, Rules and Listing Regulations, at its meeting held on May 6, 2024, recommended the appointment of Mr. Kaustubh Govind Shukla (Director Identification No.10580359) as a Non-Executive Director and Independent Director of the Company, not liable to retire by rotation, for a term of five (5) consecutive years effectiv from July 18, 2024 up to July 17, 2029, subject to approval of the Members at the ensuing AGM of the Company by way of Special Resolution. The Company has received a notice under Section 160(1) of the Act proposing his candidature for the office of Non-Executive Director and Independent Director of the Company. Mr. Kaustubh Govind Shukla has wide experience in operations and management and his induction on the Board of the Company will benefit your Company. The Board of Directors recommends his appointment and a resolution seeking Members approval, along with other essential details, is included in the Notice.

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee and in accordance with provisions of the Act, Rules and Listing Regulations appointed Mr. Venugopal Shanbhag (Director Identification No. 08888359) as an Additional Director with effect from May 7, 2024. He shall hold office as an Additional Director up to the date of ensuing AGM and is eligible for appointment as a Director. The Board of Directors, at the same meeting, also appointed him as the ''Whole-Time Director designated as Executive Director'' of the Company, not liable to retire by rotation, for a period of five (5) years effective from May 7, 2024 up to May 6, 2029, subject to the approval of the Members at the ensuing AGM of the Company by way of Ordinary Resolutions. The Company has received a notice under Section 160(1) of the Act proposing his candidature for the office of Executive Director of the Company. Mr. Venugopal Shanbhag has wide experience and expertise in Management, Sales and Operations and his appointment as a Director will benefit your Company. The Board of Directors recommends his appointment and a resolution seeking Members approval, along with other essential details, is included in the Notice.

The disclosures required pursuant to Regulation 36 of the Listing Regulations, Clause 1.2.5 of the Secretarial Standard on General Meetings are given in the Notice of AGM and Schedule V of the Listing Regulations are given in the Corporate Governance Report, forming part of the Annual Report. The Members are also requested to refer to the pertinent items listed in the Notice of the AGM.

Mr. Jean-Claude Lasserre was appointed as a Non-Executive Additional Director with effect from May 24, 2023 and members approved the said appointment through ordinary resolution at the Annual General meeting held on August 14, 2023.

Ms. Archana Hingorani (Director Identification No. 00028037) was re-appointed as an Independent, Non-Executive Director for a second term of five (5) consecutive years, commenced from April 1,2024 up to March 31,2029. Her re-appointment was approved by the Members through Postal Ballot on March 8, 2024.

Mr. Hari Singudasu was appointed as Chief Financial Officer of the Company effective January 1, 2024. He has been associated with the Company for more than two decades and since then held various roles within the organization.

Key Managerial Personnel

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company as on March 31, 2024 and May 7, 2024 are as follows:

Name	Designation
Mr. B. Santhanam	Managing Director
Mr. Krishna Prasad	Executive, Whole-Time Director (retired effective May 6, 2024)
Mr. Venugopal Shanbhag	Executive Director (appointed effective May 7, 2024)
Mr. Deepak Chindarkar	Chief Financial Officer (retired with effect from December 31, 2023)
Mr. Hari Singudasu	Chief Financial Officer (appointed effective January 1, 2024)
Mr. K. Visweswaran	Company Secretary

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the familiarisation programme is to acquaint the Independent Directors with the Company''s business model and the industry in which it operates. Details of the familiarisation programme are accessible on the Company''s website, www.grindwellnorton.co.in/investor-information>Corporate Governance>Familiarisation Programme for Independent Directors. Furthermore, the Independent Directors are periodically briefed on the latest developments in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company''s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation. During the year, six (6) board meetings and one (1) meeting of Independent Directors were held. The maximum interval between the board meetings did not exceed the period stipulated under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

The Board has constituted or reconstituted its committees in compliance with the Act and Regulation 18 to 21 of the Listing Regulations during the year. The Committees currently in place are the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee. The Corporate Governance Report provides information about the Committees, their composition, meetings and other relevant details.

DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the financial year ended on March 31, 2024, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2024, and of the profit of the Company for the year ended on that date;

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

iv. that the annual financial statements have been prepared on a ''going concern'' basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes that the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFCs are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as the business evolves. The Company has established a mechanism to consistently detect such deficiencies and implement updated or enhanced controls wherever the potential impact of such gaps on the Company''s operations is significant.

DIRECTORS'' APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors'' appointment and remuneration. These are set out in the Policy for Appointment of Director, Key Managerial Personnel (“KMP”) and Senior Management Appointment Criteria, Performance Evaluation and Removal, which is annexed as Annexure 3 to this Report and is also accessible on the Company''s website at www.grindwellnorton.co.in/investor-information>Policies.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee has adopted a framework for performance evaluation of the Board, its committees, individual directors, and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of Board functioning, the composition of Board and its committees, culture, execution and performance of specific duties, obligations and governance. The evaluation parameters are based on the execution of specific duties, quality, deliberation at the meeting, independence of judgement, decision making, the contribution of Directors at the meetings and functioning of the Committees. The performance of the Board, its committees, individual directors, and chairperson was assessed by the Nomination and Remuneration Committee and the Board. In addition, the Independent Directors conducted an evaluation of the performance of Non-Independent Directors, Chairperson, and the Board as a whole. The Board of Directors also appraised the performance of the Independent Directors, their fulfillment of independence criteria specified by the Act and Listing Regulations, and well as their independence from management. The Director being evaluated did not participate in the evaluation process.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, no material related party transactions were entered by your Company. Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee. The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton.co.in/investor-information>Policies.

There are no transactions that are required to be reported in Form AOC-2. The details of the transactions with related parties pursuant to Ind AS-24 are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

Your Company believes that its primary objective is to cater to the requirement of its customers, while simultaneously create job opportunities, providing livelihood and income for all its stakeholders (including suppliers, vendors, service providers, employees, lenders, shareholders etc.). In addition, it aims to contribute to the government''s revenue. According to your Company''s belief, meeting its obligations to society entails pursuing its main objective while upholding the highest standards of corporate governance and ethical conduct in its business operations. Against the backdrop of this belief, your Company is committed to executing the objectives outlined in its CSR policy. The CSR policy and initiatives were undertaken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Act, Corporate Social Responsibility Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. During the year, the Company has spent ?7.80 crores towards CSR activities, which are in line with the CSR policy of the Company.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognises that managing risk is an integral part of good management practice and an essential element of good corporate governance. It aims to have a common, formalized, and systematic approach for managing risk and implementing risk management processes across the Company. The Company ensures effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company''s Internal Financial Control systems are commensurate with the nature of its business, financial statements, and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow-up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and to encourage employees and others to report unethical, unlawful or improper practices, acts or activities including a leak or suspected the leak of Unpublished Price Sensitive Information and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith. During the year, the Company received two (2) complaints, and both of which were investigated and duly disposed of. The Whistle Blower Policy is accessible on the website of the Company, www.grindwellnorton.co.in/investor-information>Policies.

AUDITORSStatutory Auditors

M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No. 104607W / W100166) were appointed as Statutory Auditors of your Company at the 72^nd AGM of the Company held on July 29, 2022, till the conclusion of the 77^th AGM of the Company. The Statutory Auditors confirmed they are not disqualified from continuing as Auditors of the Company.

Cost Auditor

In accordance with Section 148 of the Act and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on the recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ended March 31,2024. M/s. Rao, Murthy & Associates, Cost Accountants, have under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for the appointment. In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board of Directors have to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board of Directors seeks your support in approving the proposed remuneration of ?3,25,000/- (Rupees three lakhs twenty five thousand only) plus applicable taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2025. M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years.

Secretarial Auditor

In accordance with Section 204 of the Act and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had re-appointed M/s. Parikh & Associates, Company Secretaries (Peer Review No.1129/2021), a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2024. The Secretarial Audit Report for the financial year ended March 31,2024, in Form No. MR-3 is set out in Annexure 6 of this Report. The Board has also re-appointed M/s. Parikh & Associates, Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2024-25.

Comments on Auditors'' Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Kalyaniwalla & Mistry LLP, Statutory Auditors, in their Auditors'' Report, by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report and by M/s. Rao, Murthy & Associates, Cost Accountants, in their Cost Audit Report. The Auditors have not reported any incident of fraud to the Audit Committee of the Company during the year under review.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company''s operations.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014 as amended, the Annual Return as on March 31, 2024 is accessible on the Company''s website, www.grindwellnorton.co.in/investor-information>Annual Reports.

DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors'' Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this Report. As per Regulation 34 of the Listing Regulations, a Business Responsibility and Sustainability Report is attached and is a part of this Annual Report. The Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board of Directors in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 of this Report and is also accessible on the Company''s website, www.grindwellnorton.co.in/investor-information>Policies.

SECRETARIAL STANDARDS

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operating effectively. The Company has complied with relevant compliances relating to Foreign Exchange Management Act, 1999.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the unwavering support and collaboration of the employees and bankers, and the loyalty of the large family of the Company''s dealers, suppliers and esteemed shareholders.

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Mar 31, 2023

Your Directors are pleased to present the 73^rd Annual Report of the Company along with the audited financial statements for the year ended March 31, 2023.

FINANCIAL HIGHLIGHTS	Standalone		('' crores) Consolidated
	2022-23	2021-22	2022-23	2021-22
Sale of Products (Gross)	2,175.46	1,854.22	2,348.20	1,861.54
Service & Other Operating Income	193.27	151.40	193.14	151.22
Revenue from Operations	2,368.73	2,005.62	2,541.34	2,012.76
Operating Profit	475.84	403.58	495.56	400.99
Finance costs	6.66	3.96	7.80	4.12
Profit before share of profit/(loss) from Joint Venture	469.18	399.62	487.76	396.87
Share of profit/(loss) in Joint Venture		-	(186)	(0.98)
Provision for Tax	118.49	101.63	124.38	100.81
Profit for the year	350.69	298.00	361.52	295.08
Other Comprehensive Income (Net)	6.88	11.60	6.82	11.60
Total Comprehensive Income for the year	357.57	309.60	368.34	306.68
Less: Share of Minority Interest	-	-	(0.38)	(0.57)
Total Comprehensive Income attributable to owners	357.57	309.60	368.72	307.25

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of ?14.50 per equity share of the face value of ?5 each for the financial year ended March 31, 2023. The dividend on equity shares, if approved by the Members, would involve a cash outflow of ?160.54 crores, as against the cash outflow of ?132.86 crores in the previous year.

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to the reserves.

OPERATIONS

The Indian economy has shown sustained growth in the financial year 2022-23 with the GDP growth estimated at 6.50% to 7% as compared to 8.70% growth in the previous financial year. The Russia-Ukraine conflict that started during February 2022, triggered the swing in the commodity prices, accelerating the inflationary pressures, However, the recovery was maintained. The monetary policy measures taken by the Reserve Bank of India to reign in the inflation resulted in slight slowdown in the economy and had impact on the exchange rate. The growth in the Indian economy has been principally led by private consumption and capital formation. The Index for Industrial Production (“IIP”), witnessed a growth of 5.50% in the financial year 2022-23. The growth in the IIP was broad based and all the sectors registered growth over the previous year. Reflecting this, your Company''s consolidated revenue from operations and operating profit increased by 26% and 24% respectively.

Abrasives

After two years of COVID related disturbances, financial year 2022-23 was relatively stable year for the Abrasive Business. Demand was stable but somewhat subdued. While the supply chain was normal, the input cost witnessed significant increase and stayed at high level for most part of the year. During the year, the Paper maker unit was commissioned successfully. The improved product-mix, gain in market share and continued control over cost helped the business grow sales and operating profit by modest 13% and 11% respectively.

Ceramics and Plastics

The Performance Ceramics and Refractories (“PCR”) business witnessed 41% increase in sales over 2021-22 mainly due to increased demand from the end user industry like foundry, steel and non-ferrous segments. The substantial increase in profit is mainly due to improved realization and improvement in the plant efficiencies. The growth in Performance Plastics business was mainly due to improved demand in automotive and life science segment. While there has been increase in the input cost, better product mix helped to maintain the margins. The Silicon Carbide business witnessed good growth in terms of sales due to relatively higher domestic demand from refractory industry, however the steep increase in input cost and also reduction in selling price resulted in lower margins. With the easing of COVID curbs in Bhutan, there was an overall increase in the output of the plant. Overall sales and operating profit of the Ceramics and Plastics segment increased by 25% and 20% respectively.

Digital Services & Others

The Captive IT Development Centre (“INDEC”) had a stable year. The Digital services segment witnessed increase in revenue in 2022-23.

SUBSIDIARY COMPANY/JOINT VENTURE/ASSOCIATE Subsidiaries

The Company has a subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited (“SGCMBPL”) and during the year, the Company acquired 100% shareholding in PRS Permacel Private Limited, (“PRS”) an unlisted company that produces aesthetic decals and other adhesive tapes, etc. in India.

With the improvement in the COVID situation and the relaxation provided by the Government of Bhutan, the operations in your Company’s subsidiary in Bhutan is stabilizing. PRS recorded sales of around ?158 crores and Profit before tax of ?18 crores for the period ended March 31, 2023.

In order to consolidate operations, improve management, achieve unified control, and benefit from operational efficiencies a merger application of PRS with your Company was filed in August 2022. The merger application is currently awaiting approval from National Company Law Tribunal (“NCLT”). The merger will not result in any changes in the Company’s shareholding.

In terms of sub-regulation (1) (c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), both SGCMBPL and PRS are not material subsidiaries.

Joint Venture

The Joint Venture Company in Gujarat, SG Shinagawa Refractories India Private Limited has achieved stable commercial production in the FY 2022-23.

Associate Company

The Company had invested in Cleanwin Energy Three LLP in the last financial year for purchase of wind power for its Mora unit and during the year, the supply of power has commenced, which will result in cost optimization and will promote sustainability.

In accordance with Section 129(3) of the Companies Act, 2013 (“Act”), Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements (incorporating the financial results of the subsidiary companies and Joint Venture), which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary companies and Joint Venture are also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary have been placed on the website of the Company, https://www.grindwellnorton.co.in/investor-information > Financial Performance.

FUTURE PROSPECTS

While the global geo-political and economic situation could bring in uncertainties, the overall economic growth in general and industrial growth in particular is neutral to positive. India’s strong infrastructure push, logistics development and industrial corridor development will contribute significantly to raising industrial competitiveness and boosting future growth. Your Company’s management will focus on growth led by new products and new markets. While the geopolitical tensions and weather related shocks could bring in short term risk, the Directors and the Company’s Management have immense confidence in your Company’s future.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR

No material changes or commitments that have had an impact on the financial position of the Company have emerged between financial year-end and the date of this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

The Company''s primary focus is to provide a professional work culture that fosters innovation, ensures high performance, and empowers employees to grow and develop individually. The Company strives to become a leader in all the businesses it operates in and places a strong emphasis on enhancing employee capabilities through training. The hiring and onboarding practices of the Company adhere to the best industry standards, and a fair and transparent performance evaluation process is followed. To improve organizational efficiency, employee engagement, and skill levels, the Company encourages participation in various training programs and mandatory e-learning courses.

More generally, employee relations were cordial and productive at all sites of your Company. At the end of the financial year, there were 2322 permanent employees on the rolls of the Company.

PREVENTION OF SEXUAL HARASSMENT

The Company is dedicated to establishing and maintaining a positive work environment that is free from any kind of discrimination or harassment. The Company firmly believes that all employees have the right to be treated with dignity and respect, and it maintains a zero-tolerance policy towards any violations of its Code of Conduct, particularly with regards to sexual harassment. To address any such issues, the Company has formed an Internal Complaints Committee (ICC) in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013. The Company did not receive any complaint related to sexual harassment during the year.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 of this Report. Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy workplace at all plant locations and work sites. The Company adheres strictly to the Environment, Health, and Safety Charter, policies, and procedures established under the Saint-Gobain Group. The Company''s plants have been certified under ISO 9001, ISO 14001, and ISO 45001. These certifications and various awards acknowledges the efforts put in and outcome achieved in enhancing the Environment, Health and Safety (“EHS”) across all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (“Rules”) is annexed as Annexure 2(A) to this Report. The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the above Rules, is provided in Annexure 2(B) forming part of this Report.

PUBLIC DEPOSITS

The Company has not accepted any public deposits, and thus, there were no outstanding amounts due on account of principal or interest on public deposits as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNELCessation

Mr. Anand Mahajan (Director Identification No. 00066320), Non-Executive Director of the Company relinquished the position of Non-Executive Director effective July 29, 2022, owing to his other commitments. The Board of Directors placed on record their appreciation for the significant contribution made by Mr. Anand Mahajan during his tenure as a Director.

Mr. Laurent Tellier (Director Identification No. 08587279), Non-Executive Director of the Company relinquished the position of Non-Executive Director effective February 13, 2023, owing to his other commitments. The Board of Directors placed on record their appreciation for the valuable contribution made by Mr. Laurent Tellier, during his tenure as a Director.

Appointment/Re-appointment

Mr. Aakil Mahajan (Director Identification No. 09682529) was appointed as an Additional Director under Non-Executive category with effect from July 30, 2022. The Members approved his appointment through Postal Ballot, the results of which were declared on September 16, 2022.

As per the Act and the Articles of Association of the Company, Non-Executive Director Mr. Sreedhar Natarajan (Director Identification No. 08320482) will retire by rotation and has been eligible and offered himself for re-appointment. The Board of Directors recommends his re-appointment and a resolution seeking shareholders’ approval, along with other essential details, is included in the Notice.

Mr. Keki Elavia, Dr. Archana Hingorani and Mr. Subodh Nadkarni have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1) and 25(8) of the Listing Regulations. There has been no change in circumstances affecting their status as Independent, Non-Executive Directors of the Company during the year.

The disclosures required pursuant to Regulation 36 of the Listing Regulations, Clause 1.2.5 of the Secretarial Standard on General Meetings are given in the Notice of AGM, forming part of the Annual Report and Schedule V of the Listing Regulations are given in the Corporate Governance Report, forming part of the Annual Report. The Members are also requested to refer to the pertinent items listed in the Notice of the AGM.

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company are:

Mr. B. Santhanam, Managing Director, Mr. Krishna Prasad, Executive, Whole-Time Director, Mr. Deepak Chindarkar, Chief Financial Officer and Mr. K. Visweswaran, Company Secretary.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the familiarisation programme is to acquaint the Independent Directors with the Company’s business model and the industry in which it operates. Details of the familiarisation programme are accessible on the Company’s website, www.grindwellnorton.co.in/investor-information > Corporate Governance > Familiarisation Programme for Independent Directors. Furthermore, the Independent Directors are periodically briefed on the latest developments in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company’s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation. During the year, five board meetings and one meeting of Independent Directors were held. The maximum interval between the board meetings did not exceed the period stipulated under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

The Board has constituted or reconstituted its committees in compliance with the Act and Regulation 18 to 21 of the Listing Regulations during the year. The Committees currently in place are the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee.

The Corporate Governance Report provides information about the Committees, their composition, meetings and other relevant details.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the financial year ended on March 31, 2023, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31,2023, and of the profit of the Company for the year ended on that date;

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

iv that the annual financial statements have been prepared on a ''going concern'' basis;

v that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes that the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFCs are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as the business evolves. The Company has established a mechanism to consistently detect such deficiencies and implement updated or enhanced controls wherever the potential impact of such gaps on the Company''s operations is significant.

DIRECTORS'' APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors'' appointment and remuneration. These are set out in the Policy for Appointment of Director, Key Managerial Personnel (“KMP”) and Senior Management Appointment Criteria, Performance Evaluation and Removal which is annexed as Annexure 3 to this Report and is also accessible on the Company''s website at https://www.grindwellnorton.co.in/investor-information > Policies.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee has adopted a framework for performance evaluation of the Board, its committees, individual directors, and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of Board functioning, the composition of Board and its committees, culture, execution and performance of specific duties, obligations and governance. The evaluation parameters are based on the execution of specific duties, quality, deliberation at the meeting, independence of judgement, decision making, the contribution of Directors at the meetings and functioning of the Committees.

The performance of the Board, its committees, individual directors, and chairperson was assessed by the Nomination and Remuneration Committee and the Board. In addition, the Independent Directors conducted an evaluation of the performance of Non-Independent Directors, Chairperson, and the Board, as a whole. The Board of Directors also appraised the performance of the Independent Directors, their fulfillment of independence criteria specified by the Act and Listing Regulations, and well as their independence from management. The Director being evaluated did not participate in the evaluation process.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, no material related party transactions were entered by your Company. Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee. The policy on related party transactions, as approved by the Board, is available on the website of the Company, https://www.grindwellnorton.co.in/investor-information > Policies. There are no transactions that are required to be reported in Form AOC-2. The details of the transactions with related parties pursuant to Ind AS-24 are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

Your Company''s believes that its primary objective is to cater to the requirement of its customers, while simultaneously create job opportunities, providing livelihood and income for all its stakeholders (including suppliers, vendors, service providers, employees, lenders, shareholders etc.). In addition, it aims to contribute to the government''s revenue. According to your Company''s belief, meeting its obligations to society entails pursuing its main objective while upholding the highest standards of corporate governance and ethical conduct in its business operations. Against the backdrop of this belief, your Company is committed to executing the objectives outlined in its CSR policy. The CSR policy and initiatives were undertaken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Act, Corporate Social Responsibility Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2022-23 was around 2.02% of the average profit of the Company during the immediately preceding three financial years.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognises that managing risk is an integral part of good management practice and an essential element of good corporate governance. It aims to have a common, formalized, and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report. The Company’s Internal Financial Control systems are commensurate with the nature of its business, financial statements, and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow-up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and to encourage employees and others to report unethical, unlawful or improper practices, acts or activities including a leak or suspected the leak of Unpublished Price Sensitive Information and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith. The Whistle Blower Policy is accessible on the website of the Company, https://www.grindwellnorton. co.in/investor-information > Policies.

AUDITORSStatutory Auditors

M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No. 104607W / W100166) were appointed as Statutory Auditors of your Company at the 72^nd AGM of the Company held on July 29, 2022, till the conclusion of the 77^th AGM of the Company. The Statutory Auditors confirmed they are not disqualified from continuing as Auditors of the Company.

Cost Auditor

In accordance with Section 148 of the Act and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on the recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ending March 31, 2024. M/s. Rao, Murthy & Associates, Cost Accountants, have under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for the appointment.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board of Directors have to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board of Directors seeks your support in approving the proposed remuneration of ''2,00,000/- (Rupees two lakhs only) plus taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2024. M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years.

Secretarial Auditor

In accordance with Section 204 of the Act and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. Parikh & Associates, Company Secretaries (Peer Review No.1129/2021), a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2023. The Secretarial Audit Report for the financial year ended March 31,2023, in Form No. MR-3 is set out in Annexure 6 of this Report.

The Board has also appointed M/s. Parikh & Associates, Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2023-24.

Comments on Auditors’ Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Kalyaniwalla & Mistry LLP, Statutory Auditors, in their Auditors’ Report by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report and by M/s. Rao, Murthy & Associates, Cost Accountants,. The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014 as amended, the Annual Return as on March 31, 2023 is accessible on the Company’s website, https://www.grindwellnorton.co.in/investor-information > Annual Reports.

DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors'' Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this Report.

As per Regulation 34 of the Listing Regulations, a Business Responsibility and Sustainability Report is attached and is a part of this Annual Report.

The Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board of Directors in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 of this Report and is also accessible on the Company''s website, https://www.grindwellnorton.co.in/investor-information > Policies.

SECRETARIAL STANDARDS

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

The Company has complied with relevant compliances relating to Foreign Exchange Management Act, 1999.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company''s operations in the future.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the unwavering support and collaboration of the employees and bankers, and the loyalty of the large family of the Company''s dealers, suppliers and esteemed shareholders.

For and on behalf of the Board of Directors

KEKI ELAVIA B. SANTHANAM

Chairman Managing Director

DIN 00003940 DIN 00494806

Mumbai, May 6, 2023

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Mar 31, 2022

Your Directors are pleased to present the 72^nd Annual Report of the Company along with the audited financial statements for the year ended March 31, 2022.

FINANCIAL HIGHLIGHTS	('' crores) Standalone Consolidated
Sale of Products (Gross) Service & Other Operating Income Revenue from Operations Operating Profit Interest Profit before share of profit/(loss) from Join Venture Share of profit/(loss) in Joint Venture Provision for Tax Profit for the year Other Comprehensive Income (Net) Total Comprehensive Income for the year Less: Share of Minority Interest Total Comprehensive Income attributable to owners	2021-22	2020-21	2021-22	2020-21
	1854.22 151.40	1493.32 139.58	1861.54 151.22	1498.76 139.15
	2005.62	1632.90	2012.76	1637.92
	403.58 3.96	322.88 3.24	400.99 4.12	320.69 3.42
	399.62 101.63	319.64 77.56	396.87 (0.98) 100.81	317.27 (0.07) 79.46
	298.00 11.60	242.07 19.59	295.08 11.60	237.74 19.59
	309.60	261.66	306.68 (0.57)	257.33 (1.44)
	309.60	261.66	307.25	258.78

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of ''12/- per equity share of face value of '' 5/-each for the financial year ended March 31,2022. The dividend on equity shares, if approved by the Members, would involve a cash outflow of '' 132.86 crores, as against the cash outflow of '' 105.18 crores in the previous year.

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to the reserves.

OPERATIONS

The recovery of growth of the Indian economy started in the second half of the financial year 2020-21 and continued during the financial year 2021-22. With ease of Covid restrictions and supply disruptions post the second wave of Covid, the output levels reached the pre-pandemic levels. India''s GDP for the financial year 2021-22 is likely to end with a growth of 8.7% compared to a contraction of 7.3% witnessed in the financial year 2020-21. Third wave of COVID-19 and Russia-Ukraine conflict that started in last quarter of financial year had limited impact. The Industrial activity has remained positive during the financial year. The Index of Industrial Production (IIP), witnessed a growth of 12% in the financial year. The industrial recovery was fairly widespread. Reflecting this your Company''s consolidated revenue from operations and operating profit increased by, 22.9% and 25.0% respectively.

Abrasives

The overall performance of the Abrasive business for the financial year 2021-22 was good. The business faced challenges in the first quarter due to disruptions caused by the second wave of Covid. The second and third quarter witnessed significant increase in input costs and the supply chain disruptions. Even though the availability of raw material eased during the last quarter of financial year the inflationary pressure continued. The improved price realization, gain in market share and continued control over costs helped the business grow the sales and operating profit by 22% and 39% respectively.

Ceramics and Plastics

The Performance Refractory business witnessed 35% increase in sales over 2020-21 mainly due to the increased demand from the end user industry. The substantial increase in profit was mainly due to improved realization and improved plant efficiencies. The Performance Plastics business had an excellent year with a significant increase in sales (domestic and, in particular, exports) and operating profit. This was mainly due to the outstanding results of the Life Sciences segment. The revival of automotive business and the construction sector resulting in higher sales of bearings and composites. The SiC business witnessed significant growth in sales and operating profit mainly due to improved domestic demand led by the refractory industry. The inflationary pressure on the input cost was more than offset by the improved realization. The operations of your Company''s subsidiary in Bhutan were continued to be impacted by the restrictions imposed by the Government to control COVID-19 and, as a result, there was a decline in production. Overall on a consolidated basis, the sales and operating profit of the Ceramics & Plastics segment increased by 31% and 36% respectively.

IT Services and Others

The captive IT development centre (INDEC) had a good year. The IT services segment witnessed an increase in revenue and profits in 2021-22.

SUBSIDIARY COMPANY/JOINT VENTURE/ASSOCIATE

The Company has one subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited. In terms of sub-regulation (1) (c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), it is not a material subsidiary. The operations of your Company''s subsidiary in Bhutan was affected due to restrictions imposed by the Government for containing the spread of COVID-19.

The Joint Venture Company, SG Shinagawa Refractories India Pvt Ltd commenced the commercial production during the financial year 2021 and are in the process of stabilizing the operations.

Associate - The Company has invested in Cleanwin Energy Three LLP for a stake of 27.27% for purchase of wind power for its Mora unit. The power purchase will commence from FY 2022-23.

In accordance with Section 129 (3) of the Companies Act, 2013 (“Act”) and Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements (incorporating the financial results of the subsidiary company and Joint Venture), which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary company and Joint Venture are also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary have been placed on the website of the Company, www.grindwellnorton.co.in.

FUTURE PROSPECTS

While the economy seems to be witnessing the recovery after leaving the worst of COVID pandemic behind, the global uncertainty created by the geo-political tensions has clouded the economic outlook. This may have short term impact on the growth, the impact on the long term will depend of how the conflict is contained. With the underlying strong economic fundamentals coupled with growth enhancing policy measures and infrastructure spending will accelerate economic growth. Your company''s management will focus on growth led by new products and new markets. Your Company''s capital expenditure programme aimed at building capacities and capabilities will help the company meet the increased demand. While the outlook for the short term is uncertain, your Directors and the Company''s Management have immense confidence in your Company''s future.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

Confronted with a global pandemic and consequent lockdowns, your Company and its employees had to quickly adapt to a very uncertain and fast-changing environment. The employees went out of their way to support their colleagues as also the Company. At all times, they showed a high degree of professional commitment and often went beyond the call of duty to keep operations running and to meet the needs of its customers. In this unique year, GNO''s employees have been exceptional in every respect. Your Directors place on record their appreciation for the huge contribution made by all its employees in this difficult year.

More generally, employee relations were cordial and productive at all sites of your Company. At the end of the financial year, there were 2178 employees.

The Company follows the best practices in hiring and on-boarding of employees. The Company adopts a fair and transparent performance evaluation process. In order to improve organizational efficiency and employee engagement, and also to improve skill levels, employees participate in various training programmes and complete mandatory e-learning courses. Company has received certification from “TOP EMPLOYER” for its good human resource processes.

Your Company is committed to create and sustain a positive workplace environment, free from discrimination and harassment of any nature. The Company believes that all employees have a right to be treated with respect and dignity and has zero tolerance towards violations of its Code of Conduct, in general, and its sexual harassment policy, in particular. The Company has constituted an Internal Complaints Committee (“ICC”) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year, no complaint under the sexual harassment policy has been received by the Company.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 of this Report.

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy workplace at all plant locations and work sites. Your Company strictly abides by the Saint-Gobain Group''s Environment, Health and Safety Charter and the policies and procedures framed under it. All the plants of your Company are certified under ISO 9001, ISO 14001 and OHSAS 18001. These certifications and various awards are recognition of the efforts made and results achieved by your Company in improving the Environment, Health and Safety at all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure 2(A) to this Report.

The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in Annexure 2(B) forming part of this Report. The Annual Report including the aforementioned information is available on the website of the Company, www.grindwellnorton.co.in.

PUBLIC DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits were outstanding as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL Cessation

Mr. Laurent Guillot (Director Identification No. 07412302), Non-Executive Director of the Company relinquished the position of NonExecutive Director effective August 05, 2021 as he decided to pursue his career outside Saint Gobain Group.

Mrs. Isabelle Hoepfner (Director Identification No. 08598846), Non-Executive Director of the Company relinquished the position of Non-Executive Director effective January 01, 2022, due to other professional commitments. Consequent to the resignation of Mrs. Isabelle Hoepfner, Mr. Krishna Prasad who was appointed as alternate Director (Director Identification No.00130438) also ceased to hold office of the Director.

The Board of Directors place on record their appreciation for the valuable contribution made by Mr. Laurent Guillot, Mrs. Isabelle Hoepfner and Mr. Krishna Prasad during their tenure as Directors.

Appointment/Re-appointment

Mr. David Eric Molho (Director Identification No. 09326249), was appointed as an Additional Director under Non-Executive category with effect from October 12, 2021. David Molho joined Saint Gobain in 2009 as Vice-President Corporate Planning.He held various positions managing various businesses of Saint-Gobain. In 2021 he was appointed as Chief Executive officer of High Performance Solutions business of Saint Gobain.

Mr. Krishna Prasad (Director Identification No. 00130438), was appointed as a Whole-time Director under Executive Director category with effect from February 03, 2022.

Mr. David Eric Molho and Mr. Krishna Prasad appointment was approved by the Members through postal ballot the result of which was declared on March 16, 2022.

In accordance with the Act and the Articles of Association of the Company, Mr. Laurent Tellier (Director Identification No. 08587279), Non-Executive, retires by rotation and, being eligible, has offered himself for re-appointment. The Board of Directors recommends the re-appointment of Mr. Laurent Tellier. A resolution seeking shareholders'' approval for his re-appointment along with other required details forms part of the Notice.

Mr. Keki Elavia, Dr. Archana Hingorani and Mr. Subodh Nadkarni have submitted declarations that each of them meets the criteria of independence as provided in Section 149 (6) of the Act and Regulation 16(1) and 25 (8) of the Listing Regulations. There has been no change in circumstances affecting their status as Independent, Non-Executive Directors of the Company during the year. They have also completed the registration with the Independent Directors Databank and requisite disclosures have been received from them in this regard.

The disclosures required pursuant to Regulation 36 of the Listing Regulations, Clause 1.2.5 of the Secretarial Standard on General Meetings are given in the Notice of AGM, forming part of the Annual Report and Schedule V of the Listing Regulations are given in the Corporate Governance Report, forming part of the Annual Report. The attention of the Members is also invited to the relevant items in the Notice of the AGM.

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company are: Mr. B. Santhanam, Managing Director, Mr. Krishna Prasad, Executive, Whole-time Director with effect from February 03, 2022, Mr. Deepak Chindarkar, Chief Financial Officer and Mr. K. Visweswaran, Company Secretary.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the programme is aimed to familiarise the Independent Directors with the Company, the nature of the industry in which the Company operates and the business model of the Company. The details of the familiarisation programme imparted to the Independent Directors are available on the Company''s website at www.grindwellnorton.co.in/investor-informaton. The Independent Directors are regularly briefed with respect to the developments that are taking place in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company''s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation.

During the year, five board meetings were held and one meeting of Independent Directors was also held. The maximum interval between the board meetings did not exceed the period prescribed under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

During the year, in accordance with the Act and Regulation 18 to 21 of the Listing Regulations, the Board has constituted or reconstituted its Committees. Currently, the Board has the following Committees:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Corporate Social Responsibility Committee

• Risk Management Committee

Details of the Committees, their constitution, meetings and other details are provided in the Corporate Governance Report. DIRECTORS'' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the financial year ended on March 31, 2022, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2022, and of the profit of the Company for the year ended on that date;

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

iv. that the annual financial statements have been prepared on a ''going concern'' basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

With reference to the point number (v), the Board believes that the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFCs are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as the business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps would have a material effect on the Company''s operations.

DIRECTORS'' APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors'' appointment and remuneration. These are set out in the Nomination and Remuneration Policy which is annexed as Annexure 3 to this Report and is also available on the Company''s website at www.grindwellnorton.co.in.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee has adopted a framework for performance evaluation of the Board, its committees, individual directors, and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of Board functioning, the composition of Board and its committees, culture, execution and performance of specific duties, obligations and governance. The evaluation parameters are based on the execution of specific duties, quality, deliberation at the meeting, independence of judgement, decision making, the contribution of Directors at the meetings and functioning of the Committees.

The performance of the Board, its committees, individual directors, and chairperson were reviewed by the Nomination and Remuneration Committee and the Board. The Independent Directors evaluated the performance of Non-Independent Directors, Chairperson, and the Board, as a whole. The Board of Directors evaluated the performance of the Independent Directors, their fulfillment of independence criteria in terms of the Act and Listing Regulations, and independence from the management. The Director being evaluated did not participate in the evaluation process.

RELATED PARTY TRANsACTIONs

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, no material related party transactions were entered by your Company.

Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee.

The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton. co.in. There are no transactions that are required to be reported in Form AOC-2.

The details of the transactions with related parties pursuant to Ind AS-24 are provided in the accompanying financial statements. CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

It is your Company''s belief that its primary goal is to serve the needs of its customers and, in the process of doing so, to generate employment, livelihood and income for all its stakeholders (suppliers, vendors, service providers, employees, lenders, shareholders etc.) and, at the same time, to contribute to the revenues of the Government. Further, it is your Company''s belief that by pursuing its primary goal and by ensuring that its business practices meet the highest standards of corporate governance and ethics, it best fulfills its obligations and responsibility to society. Against the backdrop of this belief, your Company is committed to implementing the agenda set out in its CSR policy. The CSR policy and initiatives were undertaken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Act, a Corporate Social Responsibility Committee of the Board, having an Independent Chair,

has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2021-22 was around 2.01% of the average profit of the Company during the immediately preceding three financial years.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognises that managing risk is an integral part of good management practice and an essential element of good corporate governance. It aims to have a common, formalized, and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company''s Internal Financial Control systems are commensurate with the nature of its business, financial statements, and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow-up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and encourage employees and others to report unethical, unlawful or improper practices, acts or activities including a leak or suspected the leak of Unpublished Price Sensitive Information and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith.

The Whistle Blower Policy is available on the website of the Company, www.grindwellnorton.co.in.

AUDITORS

a. statutory Auditors

In accordance with the provision of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016), completes its term as the Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting (“AGM”) of the Company.

Your Directors on recommendation of the Audit Committee, seek approval of the Members at the ensuing AGM of the Company, for appointment of M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No.104607W / W100166) for a term of five (5) consecutive years. M/s. Kalyaniwalla & Mistry LLP Chartered Accountants, have confirmed their eligibility and willingness for appointment as Statutory Auditors of the Company under the provisions of the Companies Act, 2013 and Rules framed thereunder.

Accordingly, a resolution, proposing appointment of M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No. 104607W / W100166), as the Statutory Auditors of the Company for a term of five (5) consecutive years, from the conclusion of the 72^nd AGM till the conclusion of the 77^th AGM of the Company pursuant to Section 139 of the Companies Act and Rules framed thereunder on such remuneration as may be mutually agreed between Board of Directors of the Company and the Auditors, as set out in the resolution included in the Notice convening the AGM of the Company.

The Board of Directors places on record its appreciation for the services rendered by M/s. Price Waterhouse, Chartered Accountants, as the Statutory Auditors of the Company.

b. Cost Auditor

In accordance with Section 148 of the Act and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on the recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ending March 31, 2023. M/s. Rao, Murthy & Associates, Cost Accountants, have under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for the appointment.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board of Directors have to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board of Directors seeks your support in approving the proposed remuneration of '' 2,00,000/-(Rupees two lakhs only) plus taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2023. M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and

have conducted the audit of the cost records of the Company for the past several years.

c. Secretarial Auditor

In accordance with Section 204 of the Act and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed M/s. Parikh & Associates, Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2022. The Secretarial Audit Report for the financial year ended March 31, 2022, in Form No. MR-3 is set out in Annexure 6 of this Report.

The Board has also appointed M/s. Parikh & Associates, Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2022-23.

Comments on Auditors'' Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Price Waterhouse Chartered Accountants LLP, Statutory Auditors, in their Auditors'' Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report.

The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2022 is available on the Company''s website, www.grindwellnorton.co.in.

DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors'' Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this Report.

As per Regulation 34 of the Listing Regulations, a Business Responsibility Report is attached and is a part of this Annual Report.

The Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board of Directors in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 of this Report and is also available on the Company''s website, www.grindwellnorton.co.in.

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

The Company has complied with relevant compliances relating to downstream investment under Foreign Exchange Management Act .

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company''s operations in the future.

acknowledgements

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the continued support and co-operation from its employees, Bankers and the loyalty of the large family of the Company''s Dealers, Suppliers and valued Shareholders.

For and on behalf of the Board of Directors

KEKI ELAVIA B. SANTHANAM

Chairman Managing Director

DIN00003940 DIN00494806

Bengaluru, May 6, 2022

---

Mar 31, 2019

Dear Members,

The Directors are pleased to present the 69^th Annual Report of the Company along with the audited financial statements for the year ended March 31, 2019.

FINANCIAL HIGHLIGHTS

(Rs.crores)

	Standalone		Consolidated
	2018-19	2017-18	2018-19	2017-18
Sale of Products (Gross)	1447.22	1329.92	1478.56	1355.48
Service & Other Operating Income	119.63	127.28	119.50	125.25
Less: Excise Duty		(22.81)		(22.81)
Revenue from Operations	1566.85	1434.39	1598.06	1457.92
Operating Profit	254.58	223.16	261.94	229.00
Interest	1.48	1.05	1.50	1.53
Profit before Tax	253.10	222.11	260.44	227.47
Provision for Tax	89.26	74.95	91.72	76.58
Profit for the year	163.84	147.16	168.72	150.89
Other Comprehensive Income	5.28	(0.14)	5.28	(0.14)
Total Comprehensive Income for the year	169.12	147.02	174.00	150.75
Less: Share of Minority Interest	-	-	(1.48)	(1.14)
Total Comprehensive Income attributable to owners	169.12	147.02	172.52	149.61

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of Rs.6/- per equity share of face value of Rs.5/- each for the financial year ended March 31, 2019. The dividend on equity shares, if approved by the Members, would involve a cash outflow of Rs.80.08 crores, including dividend tax, as against the cash outflow of Rs.66.74 crores in the previous year.

TRANSFER TO RESERVES

Your Directors do not propose to transfer any amount to the reserves.

OPERATIONS

While the Indian economy was stable during the financial year 2018-19, overall growth decelerated as the year unfolded and was lower than forecasts and the previous year. Similarly, after a solid start to the year, growth of industrial output (as measured by the Index for Industrial Production) weakened as the year progressed and registered a decline compared to the previous fiscal. Led by the auto industry, the manufacturing sector, in particular, witnessed a sharp decline in growth in the last quarter (less than 2%). Investment demand remained subdued throughout the year, while consumer demand has softened in recent months. While inflation (as measured by the Consumer Price Index) remained low, the Wholesale Price Index witnessed an increase (above 4% after 4 years), primarily on account of the rising trend of global oil prices. The increase in oil prices also contributed to the unexpected depreciation (8% on average during the fiscal year) of the Indian Rupee against the US Dollar; in October, the Rupee touched a new low, but has appreciated since then. Meanwhile, the Goods and Services Tax (GST) stabilized. All in all, 2018-19 was a stable, but somewhat disappointing year for the economy. Reflecting this, your Company’s standalone revenue from operations and operating profit increased by 9.2% and 14.1% respectively and consolidated revenue from operations and operating profit increased by 9.6% and 14.4% respectively.

Abrasives

After strong growth in domestic sales in the first half of the financial year, the Abrasives business witnessed a sharp fall in growth (less than 5%) in the second half. This was mainly due to the weakening of industrial activity (led by the auto sector) and partly due to our efforts to increase prices. Export markets were subdued throughout the year. Meanwhile, the business continued to focus on new products and new markets. Mainly due to the rise in input costs (on account of the higher oil prices and the depreciation of the Rupee), Margins remained under pressure througout the year. Overall in 2018-19, sales of the Abrasives business grew by 7.5% (mostly, on account of volume growth, but partly on account of price increases), while operating profit increased by 7.5%.

Ceramics & Plastics

With stable domestic demand and firm global prices, 2018-19 was a reasonable year for the Silicon Carbide business. While volumes remained at the same level, higher prices resulted in an increase in sales and an improved operating margin. The Performance Ceramics and Refractories (erstwhile, High Performance Refractories) business had an excellent year in terms of sales, with strong growth in domestic and export markets, Margins and profits, however, declined, partly due to the increase in input cost, partly due to an adverse product mix and partly due to some customer rejections. The Performance Plastics business had an excellent year with sales and profit growing significantly. The ADFORS business was stable. Overall on consolidated basis, the Ceramics and Plastics segment saw sales and operating profit grow by 16.7% and 25% respectively.

Others

The captive IT Development Centre (INDEC) benefited from the depreciation of the Rupee and the Projects division had a good year. As a result, this segment witnessed an increase in revenues and profits in 2018-19.

SUBSIDIARY COMPANY

The Company has one subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited. In terms of sub-regulation (1) (c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), it is not a material subsidiary.

The operations of your Company’s subsidiary in Bhutan were stable. In accordance with Section 129 (3) of the Companies Act, 2013 (“Act”) and Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements of the Company and its subsidiary Company, which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary Company is also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary has been placed on the website of the Company, www.grindwellnorton.co.in. Shareholders interested in obtaining a copy of the audited financial statements of the subsidiary may write to the Company Secretary at the Company’s Registered Office.

FUTURE PROSPECTS

While the long term outlook for the Indian economy remains positive, the short term outlook is uncertain. The last few months have witnessed a decline in growth. Investment demand remains weak and consumer demand has softened. Bank balance sheets remain stressed. Global oil prices have risen and the world economy has slowed down. Having said this, there are a few positives. There are signs that capacity utilization is increasing and there are hopes that the investment cycle will revive. The new Government, in its first year, is likely to take action to revive growth. Inflation is expected to remain low and the Rupee is expected to depreciate gradually. In the balance, however, it is best to assume that the current year will be similar to the previous year - another stable year with moderate growth. Your Company’s management will continue to focus on new products, new markets and exports to sustain growth even as it implements plans to improve productivity across its businesses. More important, most of your Company’s businesses have seen margins decline in the last two years, primarily on account of rising input costs (mainly, raw materials and energy) and, as such, increasing prices in 2019-20 remains a priority.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

Employee relations were cordial and productive at all sites of your Company. At the end of the financial year, there were 1956 employees. Your Directors place on record their appreciation for the contribution made by all employees in the progress of your Company.

The Company follows the best practices in hiring and on-boarding of employees. The Company adopts a fair and transparent performance evaluation process. In order to improve organizational efficiency and employee engagement, various change initiatives were undertaken during the year. To ensure this and also to improve skill levels, employees participate in various training programmes and complete mandatory e-learning courses.

Your Company is committed to create and sustain a positive workplace environment, free from discrimination and harassment of any nature. The Company believes that all employees have a right to be treated with respect and dignity and has zero tolerance towards violations of its Code of Conduct, in general, and its sexual harassment policy, in particular. During the year, no complaint under the sexual harassment policy has been received by the Company.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 of this Report.

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy work place at all plant locations and work sites. Your Company strictly abides by the Saint-Gobain Group’s Environment, Health and Safety Charter and the policies and procedures framed under it. All the plants of your Company are certified under ISO 9001, ISO 14001 and OHSAS 18001. These certifications and various awards are recognition of the efforts made and results achieved by your Company in improving the Environment, Health and Safety at all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure 2(A) to this Report.

The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a Annexure 2(B) forming part of this Report. Further, the Annual Report is being sent to the Members excluding the aforesaid Annexure 2 (B). In terms of Section 136 of the Act, the said Annexure is open for inspection at the Registered Office of the Company. Any Member interested in obtaining copy of the same may write to the Company Secretary. The full Annual Report including the aforementioned information is available on the website of the Company, www.grindwellnorton.co.in.

PUBLIC DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Appointment/Re-appointment

In accordance with the Act and the Articles of Association of the Company, Mr. Patrick Millot (Director Identification No. 00066275), Director, retires by rotation and, being eligible, has offered himself for re-appointment. The Board recommends the re-appointment of Mr. Patrick Millot.

In accordance with Section 161(1) of the Act and Article 112 of the Articles of Association of the Company and on the recommendation of the Nomination and Remuneration Committee, the Board of Directors appointed Mr. Sreedhar Natarajan (Director Identification No. 08320482) as an Additional Director of the Company with effect from February 4, 2019. Mr. Sreedhar Natarajan will hold office only up to the date of the forthcoming AGM and a notice under Section 160(1) of the Act has been received from a Member proposing his candidature for the office of Director of the Company. Mr. Sreedhar Natarajan is liable to retire by rotation.

In terms of the provisions of the Act, Mr. Keki M. Elavia (Director Identification No. 00003940) has been appointed as an Independent, Non-Executive Director at the AGM held on July 23, 2014 for a term of five consecutive years commencing from July 23, 2014. Mr. Keki M. Elavia has wide experience in the Finance and Accounts will immensely benefit to your Company. The Board of Directors, on the recommendation of the Nomination and Remuneration Committee and in accordance with the provisions of the Act and Listing Regulations, his re-appointment for a second term of five consecutive years commencing from July 23, 2019 to July 22, 2024, is proposed at the forthcoming AGM for the approval of the Members by way of Special Resolution. Mr. Keki M. Elavia will attain the age of 75 years during the said term of re-appointment. Mr. Keki M. Elavia is not liable to retire by rotation. The Company has received a notice under Section 160(1) of the Act proposing his candidature for the office of Independent, Non-Executive Director of the Company.

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee and in accordance with provisions of the Act and Listing Regulations, appointed Dr. Archana Niranjan Hingorani (Director Identification No. 00028037) as an Additional and Independent, Non-Executive Director on the Board for a tenure of five consecutive years with effect from April 1, 2019, subject to approval of Members at the AGM. Dr. Archana Niranjan Hingorani is not liable to retire by rotation. She shall hold office as Additional Director up to the date of the forthcoming AGM and is eligible for appointment as an Independent, Non-Executive Director. The Company has received a notice under Section 160(1) of the Act proposing her candidature for the office of Independent, Non-Executive Director of the Company. The induction of Dr. Archana Niranjan Hingorani, who has wide experience of the financial markets, will benefit your Company.

Mr. Keki M. Elavia and Dr. Archana Niranjan Hingorani have submitted declarations that each of them meet the criteria of independence as provided in Section 149 (6) of the Act and Regulation 16(1) of the Listing Regulations. There has been no change in circumstances affecting their status as an Independent, Non-Executive Director of the Company during the year.

The disclosures required pursuant to Regulation 36 of the Listing Regulations, clause 1.2.5 of the Secretarial Standard on General Meetings are given in the Notice of AGM, forming part of the Annual Report and Schedule V of the Listing Regulations are given in the Corporate Governance Report, forming part of the Annual Report. Attention of the Members is also invited to the relevant Items in the Notice of the AGM.

The approval of the Members for their appointment/re-appointment as Directors has been sought in the Notice convening the AGM of your Company.

Cessation

Mr. Pradip Shah (Director Identification No. 00066242), who had completed nearly 13 years on the Board of your Company, relinquished the position of Independent Director with effect from April 1, 2019, due to other professional commitments. There were no other material reasons for relinquishing the position of Independent Director. The Directors place on record their deep appreciation for the enormous contributions made by Mr. Pradip Shah, as an Independent Director from 2006 to 2012 and thereafter, as Independent Chairman of the Company. The Company and the Board benefitted immensely from Mr. Pradip Shah’s vast experience, knowledge and insights.

Mr. Shivanand Salgaocar (Director Identification No. 00001402) had been appointed as an Independent Director at the AGM held on July 23, 2014 for a term of five consecutive years commencing from July 23, 2014 till July 22, 2019. Mr. Salgaocar, who has completed nearly 13 years of service on the Board of your Company, does not wish to seek re-appointment on the expiry of his term on July 22, 2019, due to other professional commitments. There are no other material reasons for non-seeking of re-appointment for a second term. The Directors place on record their deep appreciation for the significant contributions made by Mr. Shivanand Salgaocar as an Independent Director from 2006 to 2019. The Company and the Board benefitted immensely from Mr. Salgaocar’s vast experience, knowledge and insights.

Mr. Guillaume Texier (Director Identification No. 05103331) was appointed as an Additional Director of the Company with effect from July 27, 2018. Following a restructuring within the Saint-Gobain Group and his transfer to a new position, Mr. Guillaume Texier, relinquished the position of Non-Executive Director with effect from February 4, 2019. The Directors place on record their appreciation for the valuable contribution made by Mr. Guillaume Texier during his tenure as an Additional Director.

KEY MANAGERIAL PERSONNEL

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company are: Mr. Anand Mahajan, Managing Director, Mr. Krishna Prasad, Executive, Alternate Director to Ms. Marie-Armelle Chupin, Mr. Deepak Chindarkar, Chief Financial Officer and Mr. K. Visweswaran, Company Secretary. During the year, there has been no change in the Key Managerial Personnel.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149 (6) of the Companies Act, 2013 and Regulation 16 (1) (b) and 25(8) of the Listing Regulations.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the programme is aimed to familiarise the Independent Directors with the Company, the nature of the industry in which the Company operates and the business model of the Company. The details of the familiarisation programme imparted to the Independent Directors are available on the Company’s website at www.grindwellnorton.co.in/investor-informaton. The Independent Directors are regularly briefed with respect to the developments that are taking place in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company’s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation.

During the year, five board meetings were held and one meeting of Independent Directors was also held. The maximum interval between the board meetings did not exceed the period prescribed under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

During the year, in accordance with the Act and Regulation 18 to 21 of the Listing Regulations, the Board has constituted or reconstituted its Committees. Currently, the Board has the following Committees:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders Relationship Committee

- Corporate Social Responsibility Committee

- Risk Management Committee

- Share T ransfer Committee

Details of the Committees, their constitution, meetings and other details are provided in the Corporate Governance Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the year ended on March 31, 2019, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2019, and of the profit of the Company for the year ended on that date;

iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 213, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. that the annual financial statements have been prepared on a ‘going concern’ basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes that the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFC are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps would have a material effect on the Company’s operations.

DIRECTORS’ APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors’ appointment and remuneration. These are set out in the Nomination and Remuneration Policy which is annexed as Annexure 3 to this Report and is also available on the Company’s website at www.grindwellnorton.co.in.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board of Directors, on the recommendation of the Nomination and Remuneration Committee, has adopted a framework for performance evaluation of the Board, its committees, individual directors and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of board functioning, composition of Board and its committees, culture, execution and performance of specific duties, obligation and governance. The evaluation parameters are based on the execution of specific duties, quality, deliberation at the meeting, independence of judgement, decision making, contribution of Directors at the meetings and functioning of the Committees.

The performance of the Board, its committees, individual directors and chairperson were reviewed by the Nomination and Remuneration Committee and the Board. The Independent Directors evaluated the performance of Non-Independent Directors, Chairperson and the the Board, as a whole. The Board of Directors evaluated the performance of the Independent Directors, their fulfillment of independence criteria in terms of the Act and Listing Regulations and independence from the management. The Director being evaluated did not participated in the evaluation process.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm’s length basis. During the year, no material related party transactions were entered by your Company.

Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee.

The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton.co.in. There are no transactions that are required to be reported in Form AOC-2.

The details of the transactions with related parties pursuant to Ind AS -24 are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

It is your Company’s belief that its primary goal is to serve the needs of its customers and, in the process of doing so, to generate employment, livelihood and income for all its stakeholders (suppliers, vendors, service providers, employees, lenders, shareholders etc.) and, at the same time, to contribute to the revenues of the Government. Further, it is your Company’s belief that by pursuing its primary goal and by ensuring that its business practices meet the highest standards of corporate governance and ethics, it best fulfills its obligations and responsibility to the society. Against the backdrop of this belief, your Company is committed to implement the agenda set out in its CSR policy. The CSR policy and initiatives taken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Act, a Corporate Social Responsibility Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2018-19 was around 0.63% of the profit of the Company during the three immediately preceding financial years.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognises that managing risk is an integral part of the good management practice and an essential element of good corporate governance. It aims to have a common, formalized and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company’s Internal Financial Control systems are commensurate with the nature of its business, financial statements and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and encourage employees and others to report unethical, unlawful or improper practices, acts or activities including leak or suspected leak of Unpublished Price Sensitive Information and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith.

The Whistle Blower Policy is available on the website of the Company, www.grindwellnorton.co.in.

AUDITORS

a. Statutory Auditors

M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016) were appointed as Statutory Auditors of your Company at the 67^th AGM of the Company held on July 26, 2017 till the conclusion of the 72^nd AGM of the Company to be held in the year 2022. As per provisions of the Section 139 of the Act, the appointment of Auditors is required to be ratified by the Members at every AGM.

In accordance with the Companies Amendment Act, 2017, enforced on May 7, 2018, by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every AGM. Accordingly, no resolution is being proposed for ratification of appointment of Statutory Auditors at the ensuing AGM and a note in respect of same has been included in the Notice for this AGM.

b. Cost Auditor

In accordance with Section 148 of the Act and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on recommendation of the Audit Committee appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ending March 31, 2020. M/s. Rao, Murthy & Associates, Cost Accountants, have, under Section 139(1) of the Act and the Rules framed thereunder furnished a certificate of their eligibility and consent for appointment.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board has to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board seeks your support in approving the proposed remuneration of Rs.2,00,000/- (Rupees two lakhs only) plus taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2020.

M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years.

c. Secretarial Auditor

In accordance with Section 204 of the Act and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2019. The Secretarial Audit Report for the financial year ended March 31, 2019 in Form No. MR-3 is set out in Annexure 6 of this Report.

The Board has also appointed M/s. Parikh & Associates, Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2019-20.

Comments on Auditors’ Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Price Waterhouse Chartered Accountants LLP, Statutory Auditors, in their Auditors’ Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report.

The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

EXTRACT OF ANNUAL RETURN

The extract of annual return in Form No. MGT-9 is attached as Annexure 7 to this Report. The extract of annual return is also available on the Company’s website, www.grindwellnorton.co.in.

DISCLOSURE REQUIREMENTS

As per Listing Regulations, the Corporate Governance Report with the Auditors’ Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this Report.

As per Regulation 34 of the Listing Regulations, a Business Responsibility Report is attached and is a part of this Annual Report.

The Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 of this Report and is also available on the Company’s website, www.grindwellnorton.co.in.

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operative effectively.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There have been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company’s operations in the future.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the continued support and co-operation from its employees, Bankers and the loyalty of the large family of the Company’s Dealers, Suppliers and valued Shareholders.

For and on behalf of the Board of Directors

KEKI M. ELAVIA ANAND MAHAJAN

Chairman Managing Director

Mumbai, May 29, 2019

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Mar 31, 2018

BOARD’S REPORT

Dear Members,

The Directors present the 68^th Annual Report of the Company along with the audited financial statements for the year ended March 31, 2018.

FINANCIAL HIGHLIGHTS

(Rs, crores)

	Standalone		Consolidated
	2017-18	2016-17	2017-18	2016-17
Sale of Products (Gross)	1329.92	1259.43	1355.48	1286.16
Service & Other Operating Income	127.28	110.38	125.25	108.49
Less: Excise Duty	(22.81)	(100.44)	(22.81)	(100.44)
Revenue from Operations	1434.39	1269.37	1457.92	1294.21
Operating Profit	223.16	173.85	229.00	181.72
Interest	1.05	1.10	1.53	2.00
Profit before Tax	222.11	172.75	227.47	179.72
Provision for Tax	74.95	56.74	76.58	58.83
Profit for the year	147.16	116.01	150.89	120.89
Other Comprehensive Income	(0.14)	10.46	(0.14)	10.51
Total Comprehensive Income for the year	147.02	126.47	150.75	131.40
Less: Share of Minority Interest	-	-	(1.14)	(1.49)
Total Comprehensive Income attributable to owners	147.02	126.47	149.61	129.91

The Company proposes to transfer an amount of Rs, 7.36 crores to General Reserve. An amount of Rs, 139.66 crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend for approval of the Members a dividend of Rs, 5/- per equity share of face value of Rs, 5/-(Rupees five only) each for the financial year ended March 31,2018. The dividend on equity shares, if approved by the Members, would involve a cash outflow of''66.74 crores, including dividend tax, as against the cash outflow ofRs, 53.31 crores in the previous year.

OPERATIONS

The uncertainty caused by the implementation of the Goods and Services Tax (“GST”) adversely impacted growth in the first half of the fiscal year. The new Index for Industrial Production (“IIP”) which was released in April 2017, where the base year was 2011-12 and the basket of goods has been changed to make it more representative, witnessed low growth between April and October (average of ~2.5%). Since then, however, growth has been strong. The significant increase from November onwards is partly on account of a low base, partly on account of re-stocking of the channel inventories post-GST and partly on account of a partial revival led by the auto sector. While growth increased, inflation and the exchange rate remained relatively stable. On the other hand, investment in the economy remained at a record low level. Reflecting this, your Company’s revenue from operations and operating profit increased by 12.6% and 25.9% respectively over the previous year.

- Abrasives

After witnessing barely any growth in the first half, the Abrasives business bounced back in the second half and delivered double-digit growth. This was partly on account of higher level of industrial activity and partly on account of re-stocking of the channel inventories post-GST. Meanwhile, the business continued to focus on new products and new markets. Overall in 2017-18, sales of the Abrasives business grew by 8.1%. Most of this growth was on account of volumes, which led to an increase of 10.5% in operating profits, while the operating margin remained at the same level.

- Ceramics & Plastics

After facing severe headwinds for a few year (excess global supply and low prices), the worst seems to be over for the Silicon Carbide business, which witnessed growth in sales and operating profits, albeit on a low base. The Tirupati plant benefited from improved availability of power in the first half of the year. The High Performance Refractories business witnessed strong growth in domestic sales and even stronger growth in exports. Overall, the business delivered higher sales and profits. The Performance Plastic business had an excellent year with sales and profits growing significantly. The ADFORS business was stable. Overall in 2017-18, sales and operating profit of the Ceramics & Plastics businesses grew by 21% and 67% respectively over the previous year.

- Others

The “Others” segment includes INDEC (the captive IT Development Centre that provides services to the Saint-Gobain Group globally), the Projects division and a Trading division (that primarily trades in roofing and siding products of CetainTeed Corporation, USA, an affiliate of your Company). All these activities witnessed an increase in revenues and profits in 2017-18.

SUBSIDIARY COMPANY

The Company has one subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited. In terms of sub-regulation (1) (c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), it is not a material subsidiary.

The operations of your Company’s subsidiary in Bhutan were stable. In accordance with Section 129 (3) of the Companies Act, 2013 (“Act”) and Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements of the Company and its subsidiary Company, which forms part of the Annual Report. A statement in Form AOC-1 containing salient features of the financial statements of the subsidiary Company is also included in the Annual Report. In accordance with the provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statements of the subsidiary has been placed on the website of the Company, www.grindwellnorton.co.in. Shareholders interested in obtaining a copy of the audited financial statements of the subsidiary may write to the Company Secretary at the Company’s Registered Office.

FUTURE PROSPECTS

While the long term outlook for the Indian economy remains very positive, the short term outlook is somewhat uncertain. The last few months have witnessed higher growth, but it is far from clear that this higher growth rate will be sustained. Investment demand remains low. Bank balance sheets remain stressed. Global oil prices have risen. The Goods and Services Tax remains a work-in-process. Having said that, there are several positives: there are signs that capacity utilization is increasing and the investment cycle will revive, inflation is expected to remain low and the Rupee is expected to depreciate gradually, exports have resumed growth. In the balance, there is a greater likelihood of higher industrial growth in the new fiscal. Your Company’s management will continue to focus on new products, new markets and exports to sustain growth even as it implements plans to improve productivity across its businesses. More important, your Company’s businesses are facing severe pressures on account of rising input costs (mainly, raw materials and energy) and, as such, increasing prices in 2018-19 will be an overarching priority.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF FINANCIAL YEAR

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of loans, guarantees and investments have been disclosed in the financial statements.

HUMAN RESOURCES

Employee relations were cordial and productive at all sites of your Company. At the end of the financial year, there were 1820 employees. During the year a new productivity enhancing wage agreement was concluded with the workers’ union at Mora. Your Directors place on record their appreciation for the contribution made by all employees in the progress of your Company.

The Company follows the best practices in hiring and on-boarding of employees. The Company adopts a fair and transparent performance evaluation process. In order to improve organizational efficiency and employee engagement, various change initiatives were undertaken during the year. To ensure this and also to improve skill levels, employees participate in various training programmes and complete mandatory e-learning courses. One important initiative launched during the year was the adoption of Saint-Gobain Attitudes.

Your Company is committed to create and sustain a positive workplace environment, free from discrimination and harassment of any nature. The Company believes that all employees have a right to be treated with respect and dignity and has zero tolerance towards violations of its Code of Conduct, in general, and its sexual harassment policy, in particular. During the year, the Company received one complaint of sexual harassment and the same has been resolved by taking appropriate action.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act and read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in the Annexure 1 to this Report.

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy work place at all plant locations and work sites. Your Company strictly abides by the Saint-Gobain Group’s Environment, Health and Safety Charter and the policies and procedures framed under it. All the plants of your Company are certified under ISO 9001, ISO 14001 and OHSAS 18001. These certifications and various awards are recognition of the efforts made and results achieved by your Company in improving the Environment, Health and Safety at all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure 2(A) to this Report.

The Statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a Annexure 2(B) forming part of this Report. Further, the Annual Report is being sent to the Members excluding the aforesaid Annexure 2(B). In terms of Section 136 of the Act, the said Annexure is open for inspection at the Registered Office of the Company. Any Member interested in obtaining copy of the same may write to the Company Secretary. The full Annual Report including the aforementioned information is available on the website of the Company, www.grindwellnorton.co.in.

PUBLIC DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of the provisions of the Act, Mr. Pradip Shah, Mr. Keki M. Elavia and Mr. Shivanand Salgaocar have been appointed as Independent Directors at the Annual General Meeting (“AGM”) held on July 23, 2014 for a term of five (5) consecutive years commencing from July 23, 2014. They have submitted a declaration that each of them meet the criteria of independence as provided in Section 149 (6) of the Act and Regulation 16(1) (b) of the Listing Regulations. There has been no change in circumstances affecting their status as an Independent Director during the year.

Due to other professional commitments, Mr. Jean-Pierre Floris resigned as a member of the Board with effect from December 7, 2017. The Directors place on record their appreciation for the valuable contribution made by him during his long tenure as a Director of your Company.

In accordance with the Act and the Articles of Association of the Company, Ms. Marie-Armelle Chupin, Director, retires by rotation and, being eligible, has offered herself for re-appointment. The Board recommends the re-appointment of Ms. Marie-Armelle Chupin. Her brief profile and her experience is disclosed in the Notice convening the AGM.

Pursuant to Section 203 of the Act, the Key Managerial Personnel of the Company are: Mr. Anand Mahajan, Managing Director, Mr. Krishna Prasad, Executive, Alternate Director to Ms. Marie-Armelle Chupin, w.e.f. May 23, 2017, Mr. Deepak Chindarkar, Chief Financial Officer and Mr. K. Visweswaran, Company Secretary. During the year, there has been no change in the Key Managerial Personnel.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The purpose of the programme is aimed to familiarize the Independent Directors with the Company the nature of the industry in which the Company operates and the business model of the Company. The details of the familiarization programme imparted to the Independent Directors are available on the Company’s website at www.grindwellnorton.co.in/investor-information. The Independent Directors are regularly briefed with respect to the developments that are taking place in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company’s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation.

During the year, five board meetings were held and one meeting of Independent Directors was also held. The maximum interval between the board meetings did not exceed the period prescribed under the Act and the Listing Regulations.

COMMITTEES OF THE BOARD

During the year, in accordance with the Act and Regulation 18 to 21 of the Listing Regulations, the Board has constituted or reconstituted its Committees. Currently, the Board has the following Committees:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders Relationship Committee

- Corporate Social Responsibility Committee

- Risk Management Committee

- Share Transfer Committee

Details of the Committees, their constitution, meetings and other details are provided in the Corporate Governance Report. DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134 of the Act:

i. that in the preparation of the annual financial statements for the year ended on March 31, 2018, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2018, and of the profit of the Company for the year ended on that date;

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

iv. that the annual financial statements have been prepared on a ‘going concern’ basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and the IFC are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will, therefore, be gaps in the IFC as business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps would have a material effect on the Company’s operations.

DISCLOSURE ON CONFIRMATION WITH THE SECRETARIAL STANDARDS

Your Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

DIRECTORS’ APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors’ appointment and remuneration. These are set out in the Nomination and Remuneration Policy which is annexed as Annexure 3 to this Report.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board, on the recommendation of the Nomination and Remuneration Committee, has adopted a framework for performance evaluation of the Board, its committees, individual directors and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of board functioning, composition of Board and its committees, culture, execution and performance of specific duties, obligation and governance. The performance of the Board, its committees, individual directors and chairperson were reviewed by the Board and Nomination and Remuneration Committee. The independent directors evaluated the performance of non-independent directors, chairperson and Board as a whole.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm’s length basis. During the year, the Company has not entered into any contract/arrangement/transaction with related parties which would be considered material as prescribed under the Act and Regulation 23 of the Listing Regulations.

Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee.

The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton.co.in. There are no transactions that are required to be reported in Form AOC-2.

The details of the transactions with related parties are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

It is your Company’s belief that its primary goal is to serve the needs of its customers and, in the process of doing so, to generate employment, livelihood and income for all its stakeholders (suppliers, vendors, service providers, employees, lenders, shareholders etc.) and, at the same time, to contribute to the revenues of the Government. Further, it is your Company’s belief that by pursuing its primary goal and by ensuring that its business practices meet the highest standards of corporate governance and ethics, it best fulfills its obligations and responsibility to the society. Against the backdrop of this belief, your Company is committed to implement the agenda set out in its CSR policy. The CSR policy and initiatives taken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Act, a Corporate Social Responsibility Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2017-18 was around 0.64% of the average profit of the Company during the three immediately preceding financial years.

DIVIDEND DISTRIBUTION POLICY

Dividend Distribution Policy of the Company as required under the Listing Regulations was adopted to set out the parameters and the circumstances that will be taken into account by the Board in determining the distribution of dividend to its shareholders. The policy is annexed as Annexure 5 to this Report and is also available on the Company’s website at www.grindwellnorton.co.in.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognizes that managing risk is an integral part of the good management practice and an essential element of good corporate governance. It aims to have a common, formalized and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company’s Internal Financial Control systems are commensurate with the nature of its business, financial statements and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and encourage employees to report unethical, unlawful or improper practices, acts or activities and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith.

The Whistle Blower Policy is available on the website of the Company, www.grindwellnorton.co.in.

AUDITORS

a. Statutory Auditors

M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016) were appointed as Statutory Auditors of your Company at the 67^th AGM of the Company held on July 26, 2017 till the conclusion of the 72^nd AGM of the Company to be held in the year 2022. As per provisions of the Section 139 of the Act, the appointment of Auditors is required to be ratified by the Members at every AGM.

In accordance with the Companies Amendment Act, 2017, enforced on May 7, 2018, by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every AGM.

b. Cost Auditor

In accordance with Section 148 of the Act and Rules framed there under, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants (Firm Registration No. 000065), to conduct the audit of the cost records maintained by the Company for the financial year ending March 31, 2019. M/s. Rao, Murthy & Associates, Cost Accountants, have, under Section 139(1) of the Act and the Rules framed there under furnished a certificate of their eligibility and consent for appointment.

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor as recommended by the Audit Committee and approved by the Board has to be ratified by the Members of the Company. Accordingly, an appropriate resolution forms part of the Notice convening the AGM. The Board seeks your support in approving the proposed remuneration of Rs, 2,00,000/- (Rupees two lakhs only) plus taxes and out of pocket expenses at actuals payable to the Cost Auditor for the financial year ending March 31, 2019.

M/s. Rao, Murthy & Associates, Cost Accountants, have vast experience in the field of cost audit and have conducted the audit of the cost records of the Company for the past several years.

c. Secretarial Auditor

In accordance with Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2018. The Secretarial Audit Report for the financial year ended March 31, 2018 in Form No. MR-3 is set out in Annexure 6 of this Report.

The Board has also appointed M/s. Parikh & Associates, Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company for the financial year 2018-19.

COMMENTS ON AUDITORS’ REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Price Waterhouse Chartered Accountants LLP, Statutory Auditors, in their Auditors’ Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report.

The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

EXTRACT OF ANNUAL RETURN

The extract of annual return in Form No. MGT-9 is attached as Annexure 7 to this Report. The extract of annual return is also available on the Company’s website, www.grindwellnorton.co.in.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT AND CORPORATE GOVERNANCE REPORT

As per Regulation 34, Schedule V of the Listing Regulations, the Corporate Governance Report with the Practicing Company Secretaries’ Certificate thereon and the Management Discussion and Analysis Report are annexed and forms part of this Report.

BUSINESS RESPONSIBILITY REPORT

In compliance with Regulations 34 of the Listing Regulations, a Business Responsibility Report is annexed as part of this Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There has been no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company’s operations in the future.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Companies de Saint-Gobain and its subsidiaries, the continued support and co-operation from its employees, Bankers and the loyalty of the large family of the Company’s Dealers, Suppliers and valued Shareholders.

For and on behalf of the Board of Directors

PRADIP SHAH ANAND MAHAJAN

Chairman Managing Director

Mumbai, May 30, 2018

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Mar 31, 2017

BOARD’S REPORT

The Members,

The Directors present the 67^th Annual Report of the Company along with the audited financial statements for the year ended March 31, 2017.

FINANCIAL HIGHLIGHTS

(Rs, Crore)

	Standalone		Consolidated
	2016-17	2015-16	2016-17	2015-16
Sale of Products (Gross)	1259.43	1154.28	1286.16	1178.54
Service & Other Operating Income	110.38	86.39	108.49	84.97
Less: Excise Duty	(100.44)	(90.08)	(100.44)	(90.08)
Revenue from Operations	1269.37	1150.59	1294.21	1173.43
Operating Profit	173.85	155.79	181.72	163.51
Interest	1.10	6.90	2.00	2.42
Profit before Tax	172.75	155.10	179.72	161.09
Provision for Tax	56.74	52.96	58.83	54.70
Profit for the year	116.01	102.14	120.89	106.39
Less: Share of Minority Interest	-	-	(1.49)	(115)
Profit for the year after Minority Interest	-	-	119.40	105.24
Retained Earnings	196.76	192.73	198.47	191.72

The Company proposes to transfer an amount of Rs, 6.05 Crore to the General Reserve. An amount of Rs, 110 Crore is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend dividend of Rs, 4/- per equity share of face value of Rs, 5/- (Rupees Five only) each for the financial year ended March 31, 2017. The dividend on equity shares, if approved by the Members would involve cash outflow of Rs, 53.31 Crore, including dividend tax as against the cash outflow of Rs, 43.31 Crore towards dividend in the previous year.

BONUS ISSUE

Consequent to the approval of the shareholders through postal ballot and e-voting on July 7, 2016, your Company has issued 5,53,60,000 bonus shares in the ratio of 1:1 (i.e. one fully paid equity share of Rs, 5/- (Rupees Five only) each for every one fully paid equity shares). The bonus shares were allotted on July 22, 2016.

Consequently, the issued, subscribed and paid-up equity share capital of your Company has increased from Rs, 27,68,00,000 divided into 5,53,60,000 equity shares of Rs, 5/- (Rupees Five only) each to Rs, 55,36,00,000 divided into 11,07,20,000 equity shares of Rs, 5/- (Rupees Five only) each.

OPERATIONS

In 2016-17, the new, recently released, Index for Industrial Production (“IIP”) witnessed an increase of 5% (the increase as per the old Index was less than 1%). The new Index, where the base year is 2011-12 and the basket of goods has been changed, is expected to be more representative of the growth of the sector. As per the new IIP, growth in 2016-17 is much higher than the preceding three years during which growth averaged about 3.6% per annum. Investment in the economy, however, also remained at a record low level (Gross Capital Formation in 2016-17 was 29.08% of GDP). Reflecting this, your Company''s overall sales growth over the last few years has been lower than in earlier years.

- Abrasives

The higher growth (compared to the preceding three years) of the industrial sector, buoyed domestic demand. Meanwhile, the business continued to focus on new products and new markets. Partly because of improved domestic demand and partly because of market share gains, your Company''s Abrasives sales increased by 10% in 2016-17. Most of this growth was on account of volumes, which led to an increase of 11% in operating profits, while the operating margin remained at the same level.

- Ceramics & Plastics

The Silicon Carbide business stabilized at a low level in 2016-17 in the face of excess global supply and low prices. The business continued to lose market share to imports from China and Vietnam. At the same time, production at your Company''s Tirupati plant continued to be affected due to reduced power supply from Andhra Pradesh Gas Power Corporation Limited for much of the fiscal year. Consequently, production, sales, prices and operating profit witnessed a further decline. The High Performance Refractoriness business had a year of mixed fortunes with domestic sales witnessing strong growth even as exports and margins declined. Growth of the Performance Plastics business was much lower than in the previous year, mainly due to softening of demand in certain end-user segments. With improved order inflow (domestic and exports), the ADFORS business witnessed strong growth on a low base.

SUBSIDIARY COMPANY

The Company has one subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited. It is not a material subsidiary in terms of sub-regulation (1)(c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”).

The operations of your Company''s subsidiary in Bhutan were stable. In accordance with Section 129(3) of the Companies Act, 2013 (“Act”) and Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards (“AS”), the Company has prepared consolidated financial statements of the Company and its subsidiary company, which forms part of the Annual Report. A statement in Form AOC-I containing salient features of the financial statements of the subsidiary company is also included in the Annual Report. In accordance with provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statement of the subsidiary has been placed on the website of the Company, www.grindwellnorton.com. Shareholders interested in obtaining a copy of the audited financial statements of the subsidiary may write to the Company Secretary at the Company''s Registered Office.

FUTURE PROSPECTS

While the long term outlook for the Indian economy remains very positive, the short term outlook is uncertain. Investment demand remains low. The order inflow, across businesses, remains muted and there is no pull from the channel. While the implementation of the Goods and Services Tax Act will have a positive impact in the medium term, it will accentuate short term uncertainty. With capacity utilization increasing, inflation expected to remain low, the Rupee expected to depreciate gradually and the cumulative impact of the economic reforms initiated by the Government being positive, there are hopes of higher industrial growth in the new fiscal. Under the circumstances, your Company''s management will continue to focus on new products, new markets and exports to sustain growth.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF FINANCIAL YEAR

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes forming part of the financial statements.

HUMAN RESOURCES

Employee relations were cordial at all sites of your Company. At the end of the financial year, there were 1850 employees. During the year a new productivity-enhancing wage agreement was concluded with the workers'' union at Nagpur. Your Directors place on record their appreciation for the contribution made by all employees in the progress of your Company. The Company follows the best practices in hiring and on-boarding of employees. The Company adopts a fair and transparent performance evaluation process. In order to improve organizational efficiency and employee engagement, various process change initiatives were undertaken during the year. To ensure this and also to improve the skill levels, employees participate in various training programmes and complete mandatory e-learning courses.

Your Company is committed to creating and maintaining a healthy working environment that enables employees to work without fear of prejudice, gender bias and sexual harassment. The Company believes that all employees have a right to be treated with respect and dignity and has zero tolerance towards violations of its Code of Conduct, in general, and its sexual harassment policy, in particular. During the year, no complaint under the sexual harassment policy has been received by the Compliance Committee.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in Annexure 1 to this Report.

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy work place at all plant locations and work sites. Your Company strictly abides by the Saint-Gobain Group''s Environment, Health and Safety Charter and the policies and procedures framed under it. All the plants of your Company are certified under ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007. These certifications and various awards are recognition of the efforts made and results achieved by your Company in improving Environment, Health and Safety at all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of the Annual Report.

Having regard to the provisions of the first proviso to Section 136(1) of the said Act, the Annual Report, excluding the aforesaid information, is being sent to the Members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours and any Member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The full Annual Report including the aforesaid information is available on the website of the Company, www.grindwellnorton.com.

PUBLIC DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of the provisions of the Companies Act, 2013, Mr. Pradip Shah, Mr. Keki M. Elavia and Mr. Shivanand Salgaocar have been appointed as Independent Directors at the Annual General Meeting (“AGM”) held on July 23, 2014 for a term of five (5) consecutive years commencing from July 23, 2014.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Mr. Mikhil Narang, Director, retires by rotation and, being eligible, has offered himself for re-appointment.

The Board, on the recommendation of the Nomination and Remuneration Committee, appointed Mr. Krishna Prasad (Director Identification No. 00130438) as an Alternate Director to Ms. Marie-Armelle Chupin (Director Identification No. 00066499), Non-Executive Director of the Company.

Being in employment with the Company and for the purpose of the compliance with the Companies Act, 2013 and Rules framed thereunder, appointment and terms of remuneration of Mr. Krishna Prasad as Whole-Time Director designated as Executive Director of the Company for a period of five (5) years with effect from May 23, 2017, upon his appointment as an Alternate Director to Ms. Marie-Armelle Chupin, Non-Executive Director, subject to the approval of the Members at the ensuing AGM of the Company. Mr. Krishna Prasad shall not hold office for a period longer than that permissible to Ms. Marie-Armelle Chupin.

Mr. Krishna Prasad graduated from College of Engineering, Trivandrum in 1984 with B.Tech degree in Mechanical Engineering. He completed his Post Graduate Diploma from the Indian Institute of Management, Bengaluru in 1990. Mr. Krishna Prasad joined Grindwell Norton Limited in 1990 and has, since then, served in various positions. He is currently holding the position of Vice-President, Ceramics & Plastics and Corporate Services.

The resolution seeking approval of the Members for the appointment of Mr. Krishna Prasad has been incorporated in the Notice convening the AGM of the Company along with brief details about him. The Company has received a notice under Section 160 of the Act along with the requisite deposit proposing the appointment of Mr. Krishna Prasad.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission, sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

DECLARATION GIVEN BY INDEPENDENT DIRECTORS

The Company has received declarations from all Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16 of the Listing Regulations..

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The familiarization programmes are aimed to familiarize the Independent Directors with the Company, nature of industry in which the Company operates and business model of the Company. The details of the familiarization programme imparted to Independent Directors are available on the Company''s website at http://www.grindwellnorton.co.in/investor-information. The Independent Directors are regularly briefed with respect to the developments that are taking place in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company''s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation.

During the year, five board meetings were held. The maximum interval between the meetings did not exceed the period prescribed under the Companies Act, 2013 and the Listing Regulations.

COMMITTEES OF THE BOARD

During the year, in accordance with the Companies Act, 2013 and Regulations 18 to 21 of the Listing Regulations, the Board has constituted or reconstituted its Committees. Currently, the Board has the following Committees:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders Relationship Committee

- Corporate Social Responsibility Committee

- Risk Management Committee

- Share Transfer Committee

Details of the Committees, their constitution and other details are provided in the Corporate Governance Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

i. that in the preparation of the annual financial statements for year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on March 31, 2017, and of the profit of the Company for the year ended on that date;

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

iv. that the annual financial statements have been prepared on a ''going concern'' basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes the Company has sound Internal Financial Controls (“IFC”) commensurate with the nature and size of its business. However, business is dynamic and IFC are not static, and evolve over time as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will therefore be gaps in the IFC as business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps would have a material effect on the Company''s operations.

DIRECTORS’ APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors'' appointment and remuneration. These are set out in the Nomination and Remuneration Policy which is annexed as Annexure 3 to this Report.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board, on recommendation of the Nomination and Remuneration Committee, has adopted a framework for performance evaluation of the Board, its committees, individual directors and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of board functioning, composition of Board and its committees, culture, execution and performance of specific duties, obligation and governance.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, the Company has not entered into any contract/arrangement/transaction with related parties which would be considered material as prescribed under the Companies Act, 2013 and Regulation 23 of the Listing Regulations.

Prior approval of the Audit Committee is obtained for all related party transactions. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-a-vis the related party transactions approved by the Audit Committee.

The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton.com. There are no transactions that are required to be reported in Form AOC-2.

The details of the transactions with related parties are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (“CSR”)

It is your Company''s belief that its primary goal is to serve the needs of its customers and, in the process of doing so, to generate employment, livelihood and income for all its stakeholders (suppliers, vendors, service providers, employees, lenders, shareholders etc.) and, at the same time, to contribute to the revenues of Government. Further, it is your Company''s belief that by pursuing its primary goal and by ensuring that its business practices meet the highest standards of corporate governance and ethics, it best fulfills its obligations and responsibility to society. Against the backdrop of this belief, your Company is committed to implement the agenda set out in its CSR policy. The CSR policy and the initiatives taken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Companies Act, 2013, a Corporate Social Responsibility Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2016-17 is around 0.56% of the average net profit of the Company during the three immediately preceding financial years.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognizes that managing risk is an integral part of good management practice and an essential element of good corporate governance. It aims to have a common, formalized and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in the Management Discussion and Analysis Report.

The Company''s Internal Financial Control systems are commensurate with the nature of its business, financial statements and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and encourage employees to report unethical, unlawful or improper practices, acts or activities and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith.

The Whistle Blower Policy is available on the website of the Company, www.grindwellnorton.com.

AUDITORS

a. Statutory Auditors

In accordance with the provision of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants (Firm Registration No 104607W/W100166), completes its term as the Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting (“AGM”) of the Company.

Your Directors on recommendation of the Audit Committee, seek approval of the Members at the ensuing AGM of the Company, for appointment of M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016), for an initial term of five (5) consecutive years. M/s. Price Waterhouse Chartered Accountants LLP, have confirmed their eligibility and willingness for appointment as Statutory Auditors of the Company under the provisions of the Companies Act, 2013 and Rules framed there under.

Accordingly, a resolution, proposing appointment of M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016) as the Statutory Auditors of the Company for a term of five (5) consecutive years, from the conclusion of the 67^th AGM till the conclusion of the 72^nd AGM of the Company pursuant to Section 139 of the Companies Act and Rules framed there under on such remuneration as may be mutually agreed between Board of Directors of the Company and the Auditors, as set out in the resolution included in the Notice convening the AGM of the Company. As per provisions of Section 139(1) of the Act, their appointment for the above tenure is subject to ratification by Members at every AGM.

The Board of Directors places on record its appreciation for the services rendered by M/s. Kalyaniwalla & Mistry LLP, Chartered Accountants, as the Statutory Auditors of the Company.

b. Cost Auditor

In accordance with Section 148 of the Companies Act, 2013 and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants, to audit the cost accounting records maintained by the Company for the financial year ended March 31, 2017.

c. Secretarial Auditor

In accordance with Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2017. The Secretarial Audit Report for the financial year ended March 31, 2017 in Form No. MR-3 is set out in Annexure 5 to this Report.

COMMENTS ON AUDITORS’ REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Kalyaniwalla & Mistry LLP, Statutory Auditors, in their Auditors'' Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report.

The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review EXTRACT OF ANNUAL RETURN

The extract of annual return in Form No. MGT-9 is attached as Annexure 6 to this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT AND CORPORATE GOVERNANCE REPORT

As per Regulation 34, Schedule V of the Listing Regulations, the Corporate Governance Report with the Auditors'' Certificate thereon and the Management Discussion and Analysis Report are annexed and form part of this Report.

BUSINESS RESPONSIBILITY REPORT

The Listing Regulations mandate inclusion of the Business Responsibility Report (“BRR”) as part of the Annual Report for the top 500 listed entities based on market capitalization. In compliance with the regulation, we have annexed the BRR as part of this Report.

SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company''s operations in the future.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to acknowledge, with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Companies de Saint-Gobain and its subsidiaries, the continued support and co-operation from its employees , Bankers and the loyalty of the large family of the Company''s Dealers, Suppliers and valued Shareholders.

For and on behalf of the Board of Directors

PRADIP SHAH ANAND MAHAJAN

Chairman Managing Director

Mumbai, May 23, 2017

---

Mar 31, 2016

The Directors present the 66th Annual Report of the Company along with the audited financial statements for the year ended 31st March 2016.

SO ALIVE @75

For seventy five years your Company has been a part of India''s industrial development. This journey began in 1941 in the humble surroundings of the fishing village of Mora (across Mumbai''s harbour). Over the years, your Company has been through several ''ups''and a few ''downs'', has gained strength with each passing year and has witnessed sustained growth and success. This incredible journey was made possible by countless people and organisations who have been associated with Grindwell Norton Limited ("GNO") over the years, including its loyal customers, dealers, suppliers, service providers and, above all, its employees. GNO and its employees are energetic, innovative and spirited and this is reflected in your Company''s theme for its 75th Anniversary: SO ALIVE @ 75. The Board believes that, with your continued support, your Company will sustain its growth and success and drive forward towards its centenary and beyond.

FINANCIAL HIGHLIGHTS

(Rs.in crores)

Standalone Consolidated

2015-16 2014-15 2015-16 2014-15

Sale of Products (Gross) 1182.61 1144.06 1206.58 1168.58

Service & Other Operating Income 61.80 50.58 62.09 51.04

Less: Excise Duty (85.96) (84.25) (85.96) (84.25)

Revenue from Operations 1158.45 1110.39 1182.71 1135.37

Operating profit 153.31 149.78 160.93 156.70

Interest 0.64 0.55 2.37 2.91

Profit before Tax 152.67 149.23 158.56 153.79

Provision for Tax 51.15 48.21 52.80 49.60

Profit for the year 101.52 101.02 105.76 104.19

Less: Share of Minority Interest - - (1.15) (0.98)

Profit for the year after Minority Interest - - 104.61 103.21

Surplus brought forwards 150.00 120.00 148.81 116.62

251.52 221.02 253.42 219.83

Appropriations:

Interim/Final Dividend 35.98 35.98 35.98 35.98

Tax on Interim / Final Dividend 7.33 7.33 7.33 7.33

Transfer to General Reserves 8.21 27.71 8.21 27.71

Surplus Carried to Balance sheet 200.00 150.00 201.90 148.81

251.52 221.02 253.42 219.83

The Company proposes to transfer an amount ofRs.8.21 crores to the General Reserve. An amount of Rs.200 crores is proposed to be retained in the Statement of profit and Loss.

DIVIDEND

The Board of Directors confirmed an interim dividend ofRs.6.50 per equity share (previous yearRs.6.50 per equity share), declared on 16th March 2016, as the final dividend for the financial year 2015-16.The dividend outgo, including dividend distribution of tax, was Rs.43.31 crores (previous yearRs.43.31crores).

BONUS ISSUE

On the occasion of the Company''s 75th Anniversary, the Board of Directors, at its meeting held on 30th May 2016, have recommended the issue of Bonus Shares in proportion of one fully paid equity share ofRs.5/-(Rupees Five only) each for one fully paid equity share ofRs.5/- (Rupees Five only) each.

OPERATIONS

For the ffth consecutive year, growth of the Index of Industrial Production ("IIP") was under 3%. In fact between 2010-11 and 2015-16, the IIP has increased from 165.5 to 181.6 (a compounded growth rate of barely 2%). Within the IIP, the compounded growth rate of the manufacturing sector has been less than 2% over 5 years (from 175.7 to 190.4), while the index for the mining sector is still below its level in 2010-11 (from 131.0 to 129.4). Your Company''s overall sales growth over the last five years has similarly been low relative to earlier years. Decline in inflation over the last two years (thanks mainly to low global oil prices) and a relatively stable Rupee continued to provide respite for the industrial economy. Against this backdrop, during the year under review, your Company''s sales and operating profit registered a modest increase of 3% and 2% respectively. The workers''union of the Bengaluru plant went on strike for a period of 20 days in November 2015 due to an impasse in the wage negotiations. The management had taken all steps to meet customer requirements during the strike period and there was no major impact on the financial performance of your Company due to the strike.

- Abrasives

The low growth of the manufacturing and mining sectors affected domestic volumes. Exports, however, witnessed strong growth. The business continued to focus on new products and new markets. With volume growth being low and with only a small improvement in price realization, higher manpower costs (partly one-time) and expenses caused a decline in operating margin.

- Ceramics & Plastics

The Silicon Carbide business had a very disappointing year. While domestic demand continued to be stable, but weak, exports saw a significant decline. Production at your Company''s Tirupati Plant was affected due to disruption in power supply from Andhra Pradesh Gas Power Corporation Limited (on account of reduced availability of gas). Low-priced competition from Vietnam and China intensified. Consequently, production, sales and prices witnessed a sharp fall and caused operating profit and margin to decline. The High Performance Refractories business also had a dififcult year with domestic demand and order flow being weak and exports being fat. An adverse product mix led to a decline in margins and profits. The Performance Plastics business had an excellent year with strong growth in sales and profits largely due to growth of the auto and life sciences market segments.

SUBSIDIARY COMPANY

The Company has one subsidiary in Bhutan, Saint-Gobain Ceramic Materials Bhutan Private Limited. It is not a material subsidiary in terms of sub-regulation (1)(c) of Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").

The operations of your Company''s subsidiary in Bhutan were stable. Despite the increase in power cost by 10% in Bhutan, the cost of electricity is still much lower than the cost at Tirupati.

In accordance with Section 129(3) of the Companies Act, 2013 ("Act") and Rule 5 of the Companies (Accounts) Rules, 2014 and relevant Accounting Standards ("AS"), the Company has prepared consolidated financial statements of the Company and its subsidiary company, which forms part of the Annual Report. A statement in Form AOC-I containing salient features of the financial statements of the subsidiary company is also included in the Annual Report. In accordance with provisions of Section 136(1) of the Act, the Annual Report of the Company, containing therein the standalone and consolidated financial statements and audited financial statement of the subsidiary has been placed on the website of the Company, www.grindwellnorton.com. Shareholders interested in obtaining a copy of the audited financial statements of the subsidiary may write to the Company Secretary at the Company''s Registered Office.

FUTURE PROSPECTS

While the long term outlook of the economy is positive, the short term outlook is uncertain. Investment demand remains low. The order inflow, across businesses, is still muted and there is no pull from the channel. With inflation expected to remain low and the Rupee expected to depreciate gradually, there are hopes of a mild recovery. Under the circumstances, your Company''s management will continue to focus on growing exports, improving price realization and containing the rise in manpower costs and expenses even as it continues to invest in new products and new markets to sustain growth. As and when growth accelerates, your Company will benefit from the investments made in capacities and capabilities in recent years.

MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF FINANCIAL YEAR

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

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes forming part of the financial statements.

HUMAN RESOURCES

Employee relations were cordial at all sites of your Company, with one exception. The workers''union at your Company''s plant at Bengaluru went on strike in November 2015 due to an impasse in the wage negotiations. The workers unconditionally resumed normal operations after 20 days and, subsequently, a new productivity-enhancing wage agreement was concluded. Earlier in the year, a new wage agreement was also concluded with the workers''union at Tirupati. At the end of the financial year, there were 1793 employees. Your Directors place on record their appreciation for the contribution made by all employees in the progress of your Company.

The Company follows best practices in hiring and on-boarding of employees. The Company adopts a fair and transparent performance evaluation process. In order to improve organizational efficiency and employee engagement, various process change initiatives were undertaken during the year. Your Company believes in conducting its business in a highly transparent and ethical way. To ensure this and also to improve skill levels, employees participate in various training programmes and complete mandatory e-learning courses.

Your Company is committed to creating and maintaining a healthy working environment that enables employees to work without fear of prejudice, gender bias and sexual harassment. The Company believes that all employees have a right to be treated with respect and dignity and has zero tolerance towards violations of its Code of Conduct, in general, and its sexual harassment policy in particular. During the year, no complaint under the sexual harassment policy has been received by the Compliance Committee.

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is set out in Annexure 1 to this Report.

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy work place at all plant locations and work sites. Your Company strictly abides by the Saint-Gobain Group''s Environment, Health and Safety Charter and the policies and procedures framed under it. All the plants of your Company are certified under ISO-14001 and OHSAS-18001. These certification and various awards are recognition of the efforts made and results achieved by your Company in improving Environment, Health and Safety at all its work sites.

PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of the Annual Report.

Having regard to the provisions of the first proviso to Section 136(1) of the said Act, the Annual Report excluding the aforesaid information is being sent to the Members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours and any Member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The full Annual Report including the aforesaid information is available on the website of the Company, www.grindwellnorton.com.

PUBLIC DEPOSITS

The Company has not accepted any public deposits and, as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of the provisions of the Companies Act, 2013, Mr. Pradip Shah, Mr. Keki M. Elavia and Mr. Shivanand Salgaocar have been appointed as Independent Directors at the Annual General Meeting held on 23rd July 2014 for a term of five consecutive years commencing from 23rd July 2014.

Consequent to their transfers to new positions within the Saint-Gobain Group, Mr. Guillaume Texier and Mr. Benoit d''Iribarne (Alternate Director to Ms. Marie-Armelle Chupin), resigned with effect from 2nd February 2016. The Directors place on record their appreciation of the valuable contribution made by them during their tenure as Directors.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Mr. Patrick Millot, Director, retires by rotation and being eligible, has offered himself for re-appointment.

Mr. Anand Mahajan was first appointed as the Managing Director of the Company on 1st April 1991. The Members had approved the last re-appointment of Mr. Anand Mahajan as the Managing Director of the Company for a period of five years from 1st April 2011 to 31st March 2016.

The Board, on the recommendations of the Nomination and Remuneration Committee, re-appointed Mr. Anand Mahajan as the Managing Director of the Company for a further period of five years with effect from 1st April 2016, subject to the approval of the Members.

On 2nd February 2016, Mr. Laurent Guillot, President, High Performance Materials Sector, was appointed as an Additional Director of your Company. Mr. Laurent Guillot is a graduate of Ecole Polytechnique and Ecole Nationale des Ponts et Chaussees, with a post-graduate degree in Macroeconomics from Universite Paris I. After serving the Government for a few years, Mr. Guillot joined Compagnie de Saint-Gobain in 2002 as Vice-President, Corporate Planning. Between 2004 and 2007, he held various positions within the High Performance Materials Sector of Saint-Gobain, In 2007, he was appointed General Delegate for Brazil, Argentina and Chile. He was the Saint-Gobain Group''s Chief Financial Officer from 2009 to the end of 2015. In January 2016, Mr. Guillot was appointed as the President of High Performance Sector of Saint-Gobain.

The resolutions seeking approval of the Members for the appointment of Mr. Anand Mahajan and Mr. Laurent Guillot have been incorporated in the notice of the forthcoming Annual General Meeting of the Company along with brief details about them. The Company has received a notice under Section 160 of the Act along with the requisite deposit proposing the appointment of Mr. Laurent Guillot.

None of the Directors or Key Managerial Personnel has any pecuniary relationships or transactions with the Company, other than salaries, commission and sitting fees.

DECLARATION GIVEN BY INDEPENDENT DIRECTORS

The Company has received declarations from all Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16 of the Listing Regulations.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The familiarisation programmes are aimed to familiarise the Independent Directors with the Company, nature of industry in which the Company operates and business model of the Company. The details of the familiarisation programme imparted to Independent Directors are available on the Company''s website at http://grindwellnorton.co.in/Familiarisation_Programme.htm. The Independent Directors are regularly briefed with respect to the developments that are taking place in the Company and its operations.

NUMBER OF MEETINGS OF THE BOARD

The Board meets at regular intervals to review the Company''s businesses and to discuss strategy and plans. A tentative annual calendar of meetings is circulated to the Directors in advance to enable them to plan their schedule and to ensure effective participation.

During the year, six board meetings were held. The maximum interval between the meetings did not exceed the period prescribed under the Companies Act, 2013 and the Listing Regulations.

COMMITTEES OF THE BOARD

During the year, in accordance with the Companies Act, 2013 and Regulations 18 to 21 of the Listing Regulations, the Board has constituted or reconstituted its Committees. Currently, the Board has the following Committees:

Audit Committee

Nomination and Remuneration Committee

Stakeholders Relationship Committee

Corporate Social Responsibility Committee

Risk Management Committee

Share Transfer Committee

Details of the Committees, their constitution and other details are provided in the Corporate Governance Report.

DIRECTORS''RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

i. that in the preparation of the annual financial statements for year ended 31st March 2016, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

ii. that such accounting policies have been selected and applied consistently and judgments and estimates have been made, 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 on 31st March 2016, and of the profit of the Company for the year ended on that date;

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

iv that the annual financial statements have been prepared on a ''going concern''basis;

v. that proper internal financial controls are in place and that such internal financial controls are adequate and are operating effectively;

vi. that proper systems to ensure compliance with the provisions of all applicable laws are in place and that such systems are adequate and are operating effectively.

With reference to the point number (v), the Board believes the Company has sound Internal Financial Controls ("IFC") commensurate with the nature and size of its business. However business is dynamic and IFC are not static, and evolve overtime as the business, technology and fraud environment changes in response to competition, industry practices, legislation, regulation and current economic conditions. There will therefore be gaps in the IFC as business evolves. The Company has a process in place to continuously identify such gaps and implement newer and/or improved controls wherever the effect of such gaps would have a material effect on the Company''s operations.

DIRECTORS''APPOINTMENT AND REMUNERATION

The Nomination and Remuneration Committee has laid down the criteria for Directors''appointment and remuneration. These are set out in the Nomination and Remuneration Policy which is annexed as Annexure 3 to this Report.

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD

The Board, on recommendation of the Nomination and Remuneration Committee, has adopted a framework for performance evaluation of the Board, its Committees, individual directors and the chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of board functioning, composition of Board and its committees, culture, execution and performance of specific duties, obligation and governance.

RELATED PARTY TRANSACTIONS

All related party transactions entered during the financial year were in the ordinary course of business and on an arm''s length basis. During the year, the Company has not entered into any contract/arrangement/transaction with related parties which would be considered material as prescribed under the Companies Act, 2013 and Regulation 23 of the Listing Regulations.

The related party transactions are approved by the Audit Committee through an omnibus resolution. The Audit Committee monitors, on a quarterly basis, the related party transactions entered vis-à-vis the related party transactions approved by the omnibus resolution.

The policy on related party transactions, as approved by the Board, is available on the website of the Company, www.grindwellnorton.com. There are no transactions that are required to be reported in Form AOC-2.

The details of the transactions with related parties are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY

It is your Company''s belief that its primary goal is to serve the needs of its customers and, in the process of doing so, to generate employment, livelihood and income for all its stakeholders (suppliers, vendors, service providers, employees, lenders, shareholders etc.) and, at the same time, to contribute to the revenues of Government. Further, it is your Company''s belief that by pursuing its primary goal and by ensuring that its business practices meet the highest standards of corporate governance and ethics, it best fulfills its obligations and responsibility to society. Against the backdrop of this belief, your Company is committed to implementing the agenda set out in its CSR policy. The CSR policy and the initiatives taken during the year, in the format prescribed under the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure 4 to this Report. In accordance with Section 135 of the Companies Act, 2013, a Corporate Social Responsibility ("CSR") Committee of the Board, having an Independent Chair, has been constituted to monitor the CSR policy and programs. The amount spent on eligible CSR activity for the financial year 2015-16 is around 0.52% of the average net profit of the Company during the three immediately preceding financial years.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROLS

Your Company recognizes that managing risk is an integral part of good management practice and an essential element of good corporate governance. It aims to have a common, formalized and systematic approach for managing risk and implementing a risk management process across the Company. The intent of the policy is to ensure the effective communication and management of risk across all risk categories. The Company has identified elements of risk, which may threaten the existence and financial position of the Company, which are set out in Management Discussion and Analysis Report.

The Company''s Internal Financial Control systems are commensurate with the nature of its business, financial statements and the size and complexity of its operations. These are routinely tested and certified by the Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

WHISTLE BLOWER POLICY AND VIGIL MECHANISM

Your Company has adopted and disseminated its Whistle Blower Policy to provide a secure environment and encourage employees to report unethical, unlawful or improper practices, acts or activities and to prohibit any adverse personnel action against those who report such practices, acts or activities, in good faith.

The Whistle Blower Policy is available on the website of the Company, www.grindwellnorton.com.

AUDITORS

a. Statutory Auditors

M/s. Kalyaniwalla & Mistry, Chartered Accountants, (Registration No 104607W), Statutory Auditors of your Company, who hold office till the conclusion of 66th Annual General Meeting, are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and Rules framed thereunder, for re-appointment as Statutory Auditors of the Company.

Your Directors on recommendation of the Audit Committee, seek approval of the Shareholders, for appointment of M/s. Kalyaniwalla & Mistry, Chartered Accountants, as the Statutory Auditors of the Company, from the conclusion of the forthcoming Annual General Meeting till the conclusion of the next Annual General Meeting of the Company, on such remuneration as may be mutually agreed between Board of Directors of the Company and the Auditors, as set out in the resolution included in the Notice convening the Annual General Meeting of the Company.

b. Cost Auditor

In accordance with Section 148 of the Companies Act, 2013 and Rules framed thereunder, the cost audit records are maintained by the Company in respect of the products which are required to be audited. Your Directors, on recommendation of the Audit Committee, appointed M/s. Rao, Murthy & Associates, Cost Accountants, to audit the cost accounting records maintained by the Company for the financial year ended 31st March 2016.

c. Secretarial Auditor

In accordance with Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Parikh & Associates, Practicing Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year ended 31st March 2016. The Secretarial Audit Report for the financial year ended 31st March 2016 in Form No. MR-3 is set out in Annexure 5 to this Report.

COMMENTS ON AUDITORS''REPORT

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Kalyaniwalla & Mistry, Statutory Auditors, in their Auditors''Report and by M/s. Parikh & Associates, Secretarial Auditor, in their Secretarial Audit Report.

The Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

EXTRACT OF ANNUAL RETURN

The extract of annual return in Form No. MGT-9 is attached as Annexure 6 to this Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT AND CORPORATE GOVERNANCE REPORT

As per Regulation 34, Schedule V of the Listing Regulations, the Corporate Governance Report with the Auditors''Certifcate thereon and the Management Discussion and Analysis Report are annexed and forms part of this Report.

ACKNOWLEDGMENTS

Your Directors take this opportunity to acknowledge with sincere gratitude the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and its subsidiaries, the continued support and co-operation from its Bankers and the loyalty of the large family of the Company''s Dealers, Suppliers and valued Shareholders.

For and on behalf of the Board of Directors

PRADIP SHAH ANAND MAHAJAN

Chairman Managing Director

Mumbai, 30th May 2016

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Mar 31, 2013

The Members, Grindwell Norton Ltd.

The Directors present the 63rd Annual Report of the Company along with the Audited Balance Sheet as at 31st March, 2013 and the Statement of Proft and Loss for the year ended 31st March, 2013.

Financial Highlights

(Rs. Crores)

2012-13 2011-12

Sale of Products (Gross) 990.68 951.32 Service & Other Operating

Income 31.32 22.26

Less: Excise Duty (76.90) (66.98)

Revenue from Operations 945.09 906.60

Operating Proft 136.64 149.35

Interest 0.59 0.37

Proft before Tax 136.05 148.98

Provision for Tax 38.38 45.35

Proft after Tax 97.67 103.63

Surplus brought forward 80.00 60.00 177.67 163.63

Appropriations:

Proposed Dividend 35.98 35.98

Tax on Proposed Dividend 6.12 5.84

Transfer to General

Reserve 35.57 41.81

Surplus Carried to Balance

Sheet 100.00 80.00

177.67 163.63

Responsibility Statement

Your Directors confrm that :

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) Appropriate accounting policies have been selected and applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the proft of the Company for that year;

(iii) Proper and suffcient care has been taken 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;

(iv) The annual accounts have been prepared on a going concern basis.

Operations

The growth of the industrial sector, in general, and within that, manufacturing, in particular, witnessed a steep decline. This was the second consecutive year of low growth. Consequently, during the year under review, your Company''s sales increased by only 4%. Domestic sales were fat (volumes contracted by about 3%) while exports grew by about 75% (largely due to one large equipment order executed by your Company''s Project Engineering Division). Overall, the growth in sales was the lowest since 2001. Meanwhile, margins came under increasing pressure due to the rise in cost of inputs (energy and raw materials), the further depreciation of the Rupee and general infationary conditions. While the management succeeded in increasing prices, in weak and highly competitive markets, the increase was not suffcient to maintain margins, even after considering the improvements in productivity, effciencies and yields and cost control. Consequently, your Company''s operating proft declined by 8.5%, the frst drop since 2008.

Dividend

In the light of your Company''s profts and its strong fnancial position, your Directors are pleased to recommend a dividend of Rs. 6.50 per equity share for the fnancial year ended 31st March, 2013. The cash outgo on account of the dividend (including dividend distribution tax) will be Rs. 42.10 crores (Previous year Rs. 41.82 crores).

Abrasives

Due to contraction in volume of many end–user industries (led by auto), domestic sales were fat in value terms even as volumes declined. With considerable efforts, the domestic volume drop was partly compensated by some growth in exports. Despite being successful in increasing prices, improving operating performance and containing expenses, operating proft and margin was much lower than the previous year. The two capacity expansion projects initiated last year were delayed. The new Non-woven Abrasives plant in Bangalore was partially commissioned in the second half while, given the market situation, the Bonded Abrasives expansion project at Nagpur was slowed down and is now likely to be commissioned in the current year.

Ceramics & Plastics

Domestic and export demand for Silicon Carbide was weak during the year under review. Margins were affected mainly on account of higher power cost (there was a steep increase in grid power tariff in Andhra Pradesh) and slightly lower price realization. The execution of major project orders during the year under review, helped the High Performance Refractories (HPR) business to register good growth in sales compared to previous year. The new HPR plant in Halol (Gujarat) was commissioned in September 2012 and stabilization of the process and ramp up of production from that unit is in progress. The Performance Plastics business also witnessed good growth during the year.

Subsidiary in Bhutan

Operations of your Company''s subsidiary in Bhutan stabilized and achieved almost 100% capacity utilization. The processing plant project started last year was commissioned in January 2013. During the year, your company has made a further equity investment of Rs. 35 million in its subsidiary. This capital infusion was utilised for the processing plant. In terms of general exemption provided under Section 212 (8) of the Companies Act, 1956, granted by Ministry of Corporate Affairs vide its circular no 02/2011 dated 8th February, 2011 and in compliance with the conditions enlisted therein, copies of the Balance Sheet, Statement of Proft & Loss, Report of Board of Directors and Auditors of the subsidiary have not been attached to the Balance Sheet of the Company. However these documents will be made available upon request by any member of the Company. As directed by said circular, the fnancial data of the subsidiary has been furnished under "Financial Information of Subsidiary Company" which forms part of Annual Report. The annual accounts of the Company including that of the subsidiary will be kept for inspection by any member. Further, pursuant to Accounting Standard (AS) – 21, consolidated fnancial statements presented by the Company include fnancial information of the subsidiary company.

Investment in Saint-Gobain Research India Limited

During the year, Saint-Gobain Research India Ltd (SGRI) was incorporated. SGRI will invest in setting up a transversal Research & Development Centre for the Saint-Gobain Group in Chennai. Two of the Group''s R&D entities and three of its entities in India have contributed to SGRI''s equity. SGRI will support the Saint-Gobain businesses in India (including all the businesses of your Company). During the year under review, your Company invested Rs. 2.34 crores in the equity capital of SGRI.

Amalgamation of Group Companies

At a meeting held on 19th April, 2013, the Board of Directors of your Company, based on the recommendation of the Audit Committee, has approved the merger of SEPR Refractories India Ltd (SEPR), Saint-Gobain Crystals and Detectors India Ltd (SGCD) and Saint-Gobain Sekurit India Ltd (SGSIL) with your Company. The appointed date for the Scheme of Amalgamation was fxed as 1st April, 2013. The Board, after due consideration, approved the share exchange ratio as determined by the independent valuer, M/s. S.R. Batliboi & Co. LLP. The fairness opinion on the valuation was provided by ICICI Securities Ltd, a category - I merchant banker.

The share swap ratio for the proposed scheme has been determined as under :

(i) 1 (one) Equity Share of the face value of Rs. 5/- (Rs. Five) each fully paid-up of the Company for every 17 (Seventeen) Equity Shares of the face value of Rs. 10 (Rs. Ten), each fully paid-up of SGSIL

(ii) 100 (one hundred) Equity Shares of the face value of Rs. 5/- (Rs. Five) each fully paid-up of the Company for every 50 (Fifty) Equity Shares of the face value of Rs. 10/- (Rs. Ten) each, fully paid-up of SGCD

(iii) 100 (one hundred) Equity Shares of the face value of Rs. 5/- (Rs. Five) each fully paid-up of the Company for every 38 (Thirty eight) Equity Shares of the face value of Rs. 10/- (Rs. Ten) each, fully paid-up of SEPR

The amalgamation is subject to all necessary approvals from statutory / regulatory authorities in the respective jurisdictions and subject to the sanction / confrmation by the concerned High Court and / or any other appropriate authority as may be necessary.

Future Prospects

There are no signs of industrial growth recovering in the short term. It is possible that a mild recovery may commence in the later part of 2013-14, but this is far from certain. Under the circumstances, your Company''s management will focus on increasing price realization, improving operating performance (implementation of the World Class Manufacturing programme remains a priority) and containing costs and working capital even as it continues to invest in new products and new markets in order to sustain growth.

Employee Relations

During the course of the year, new wage agreements were signed with unions at your Company''s plants at Tirupati and Nagpur. Employee Relations were generally cordial at all units of the Company. At the year-end there were 1596 employees. Your Directors place on record their appreciation for the contribution made by all employees in the progress of your Company.

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

Your Company is committed to ensure a clean and green, pollution-free environment as well as a safe and healthy work place at all plant locations and work sites. All the plants of your company (except the new HPR plant in Gujarat) are certifed under ISO 14001:2004 as well as OHSAS 18001:1999. These certifcations are in recognition of the sustained efforts of your Company in improving Environment, Health and Safety at all its sites.

As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the relevant information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo as required in the prescribed format is annexed (Annexure A) and forms part of this Report.

Fixed Deposit

At present your Company does not accept any fxed deposits.

Particulars of Employees

Information as per Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 forms part of this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent excluding the statement containing the particulars to be provided under Section 217 (2A) of the Act. Any member interested in obtaining such particulars may write to the Company at its registered offce.

Management Discussion & Analysis Report and Report on Corporate Governance

The Management Discussion & Analysis Report and Report on Corporate Governance along with a Certifcate dated 4th May, 2013, of the Auditors of your Company regarding the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is annexed (Annexure C) and forms part of this Report.

Directors

In accordance with the requirements of the Companies Act, 1956 and Articles of Association of the Company, Mr. Patrick Millot and Mr. M. M. Narang, retire by rotation and being eligible, offer themselves for re-appointment as Directors of the Company.

Mr. Keki M. Elavia was appointed as an additional Director with effect from 26th July, 2012. Mr. Elavia holds offce up to the date of forthcoming 63rd Annual General Meeting of the Company. As required under Section 257 of the Companies Act, 1956, the Company has received notice in writing from a Member proposing the candidature of Mr. Elavia as a Director of the Company.

Auditors

M/s. Kalyaniwalla & Mistry, Chartered Accountants (Registration No 104607W), Auditors of your Company, retire on the conclusion of 63rd Annual General Meeting. You are requested to appoint Auditors for the current fnancial year and to fx their remuneration. The retiring Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants are eligible for re-appointment.

Cost Auditors

The Board of Directors in pursuance to the Order issued by the Central Government under Section 233B of the Companies Act, 1956, have appointed M/s. Rao, Murthy & Associates, Cost Accountants for conducting the audit of the cost accounting records maintained by the Company for few of its businesses.

Acknowledgments

Your Directors take this opportunity to acknowledge with sincere gratitude the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and a number of its subsidiaries, the continued support and co-operation from its Bankers and the loyalty of the large family of the Company''s Dealers, Suppliers and valued Shareholders.

On behalf of the Board of Directors,

P. SHAH A. Y. MAHAJAN

CHAIRMAN MANAGING DIRECTOR

Mumbai; 4th May, 2013

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Mar 31, 2012

To The Members of Grindwell Norton Ltd

The Directors present the 62nd Annual Report of the Company along with the Audited Balance Sheet as at 31st March, 2012 and the Statement of Profit and Loss for the year ended 31st March, 2012.

Financial Highlights

(Rs Crores)

2011-12 2010-11

Sale of Products (Gross) 951.32 837.63 Service & other Operating

Income . 22.26 15.98

Less: Excise Duty (66.98) (56.88) Revenue from operations 906.60 796.73

Operating Profit 149.35 125.97

Interest 0.37 0.28

Profit before Tax 148.98 125.69

Provision for Tax 45.35 40.06

Profit after Tax 103.63 85.63

Surplus Brought forward 60.00 50.00

163.63 135.63

Appropriations:

Proposed Dividend 35.98 33.22

Tax on Proposed Dividend 5.84 5.39 Transfer to General

Reserve 41.81 37.02 Surplus Carried to Balance

Sheet 80.00 60.00

163.63 135.63

Responsibility Statement Your Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) appropriate accounting policies have been selected and applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of the affairs of the Company as at 31st March, 2012 and of the profit of the Company for that year;

(iii) proper and sufficient caste has been taken it 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;

(iv) the annual accounts have been prepared on a going concern basis.

Operations

During the year under review, your Company's sales recorded a growth of about 13%. The pace of industrial growth slowed down markedly as the year unfolded and in the second half of the year your Company's businesses saw little or no volume growth in domestic sales. Exports were also flat. Meanwhile, margins in all businesses came under pressure mainly because of the increase in energy prices, the depreciating Rupee and the general inflationary conditions. To counter this, an important management priority was to increase prices in all businesses. This coupled with increases in productivity and improvements in operating efficiencies and yields meant that the operating margins were maintained in most of your Company's businesses.

Dividend

Your Company's net profit increased by 20% and crossed the Rs 100 crores milestone. In the light of this and, considering your Company's strong financial position, your Directors recommend a dividend of Rs 6.50 per equity share for the financial year ended 31st March, 2012. The cash outgo on account of the dividend (including tax on dividend) will be Rs 41.82 crores (Previous year Rs 38.61 crores).

Abrasives

After two years of very strong growth, the Abrasives business grew at a more moderate pace of 12% during the year under review. Domestic and export demand remained subdued for much of the year and with important end-user industries slowing down as the year progressed, volumes were flat in the second half. But for higher sales of new products and in new markets and higher prices (increased from time to time to offset the steep increases in costs), sales growth would have been much lower. Despite being successful in increasing prices and improving operating performance, margins declined and restricted the growth of operating profit to 10%. Two large projects (expansion of Bonded Abrasives capacity at Nagpur and a new Non-woven Abrasives plant in Bangalore) were initiated and made considerable progress during the year. The plants are expected to be commissioned in the first half of 2012-13.

Ceramics & Plastics

Local demand for Silicon Carbide was similar to the previous year whereas the European market was buoyant for much of 2011. Your Company's sales volume remained flat and the increase in sales was entirely due to higher prices (which offset much of the steep increase in costs of coke and electricity). A softening of demand in certain market segments caused a slowdown in the growth of the High Performance Refractoriness business and the Performance Plastics business. The construction of a new plant for High Performance Refractory's near Vadodara in Gujarat made considerable progress during the year. The plant is expected to be commissioned in the first half of 2012-13. During the year, a project for the manufacture of mine grids (part of the ADFORS' Technical Fabrics business of Saint-Gobain) was initiated and completed. This small plant, which was commissioned in the last quarter, is located in Bangalore.

Subsidiary in Bhutan

Operations of your Company's subsidiary in Bhutan improved and the plant achieved capacity utilization of about 83%. In its second year of operations, the Company made a small operating profit. During the year, a project to set up a processing plant was initiated and made good progress. The plant is expected to be commissioned in the first half of 2012-13. In terms of the general exemption provided under Section 212(8) of the Companies Act, 1956, granted by the Ministry of Corporate Affairs vide its circular no. 02/2011 dated 8th February, 2011 and in compliance with the conditions enlisted therein, copies of the Balance Sheet, Statement of Profit and Loss, Report of the Board of Directors and Auditors of the subsidiary have not been attached to the Balance Sheet of the Company. However, these documents will be made available upon request by any member of the Company. As directed by the said circular, the financial data of the subsidiary has been furnished under 'Financial Information of Subsidiary Company' which forms part of the Annual Report. The Annual accounts of the Company including that of the subsidiary will be kept for inspection by any member. Further, pursuant to Accounting Standards (AS)-21, consolidated financial statements presented by the Company include financial information of the subsidiary company.

Future Prospects

Industrial growth has been weak and volatile and has trended downwards for several quarters and despite the RBI's recent decision to reduce reference rates by 0.5%, there are no signs that growth will recover in the near term. Meanwhile, high inflation and the depreciating Rupee remain a concern. The outlook for 2012-13 is uncertain. Your Company's financial strength will enable it to continue to implement its capital investment (new capacities and capabilities) programmes and prepare for the resumption of growth. In the meanwhile, your Company's management will focus on improving price realisation and operating performance (implementation of the World Class Manufacturing programme) and containing costs and working capital. At the same time, investments will continue to be made in developing new products and new markets in order to sustain growth.

Employee Relations

During the course of the year, new productivity-enhancing wage agreements were signed with Unions at your Company's plants at Mora and Bangalore. Employee Relations were generally cordial at all units of the Company. As at the year-end, there were 1619 employees. Your Directors place on record their appreciation for the contribution made by all the employees in the progress of your Company.

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

Your Company is committed to ensure a clean and green, pollution free environment as well as healthier and safer work place at all plant locations and work sites. All the Plants of your Company are certified under ISO 14001:2004 as well as OHSAS 18001:1999. These certifications are in recognition of the sustained efforts of your Company in improving Environment, Health and Safety at all its sites.

As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the relevant information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo as required in the prescribed format is annexed (Annexure A) and forms part of this report.

Fixed Deposit

At present your Company does not accept any fixed deposits. Particulars of Employees

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, forms part of this report. However, as per the provisions of Section 219(1)(b) (iv) of the Act, the Report and Accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Act. Any member interested in obtaining such particulars may write to the Company at its registered office.

Management Discussion & Analysis Report and Report on Corporate Governance

The Management Discussion & Analysis Report and Report on Corporate Governance along with a Certificate dated 23rd May, 2012, of the Auditors of your Company; regarding the compliance of the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is annexed (Annexure C) and forms part of this Report.

Directors

Consequent to his assuming new responsibilities in the Saint-Gobain group, Mr. J. T. Crowe resigned as Director of the Company with effect from 24th October 2011. Your Directors place on record their deep appreciation for the valuable services rendered by him during his tenure as director.

Mr. G. Texier, President of the ceramic materials business of Saint-Gobain Group, was appointed as an Additional Director, from 24th October, 2011. He holds office upto the date of the ensuing Annual General Meeting of the Company. As required under Section 257 of the Companies Act, 1956, the Company has received notice in writing from a Member proposing the candidature of Mr. Texier as Director of the Company.

In accordance with the requirements of the Companies Act, 1956 and Articles of Association of the Company, Mr. A. C. Chakrabortti, Mr. S. Salgaocar and Mr. P. Shah, Directors, retire by rotation. While Mr. Salgaocar and Mr. Shah, being eligible, offer themselves for reappointment as Directors of your Company, Mr. Chakrabortti, after serving as a Director of your Company for more than 29 years, has informed the Directors of his decision to step down from the Board and not to seek re-election.

Your Directors wish to record their immense gratitude to Mr. Chakrabortti and their deep appreciation of the important role played by him (as a Director, as Vice-Chairman and as Chairman of the Board) and the significant contribution made by him to the development and growth of your Company over several years. .

Auditors

M/s. Kalyaniwalla & Mistry, Chartered Accountants, (Registration No. 104607W), Auditors of your Company, retire on the conclusion of 62nd Annual General Meeting. You are requested to appoint Auditors for the current financial year and to fix their remuneration. The retiring Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants are eligible for re-appointment.

Acknowledgments

Your Directors take this opportunity to acknowledge with sincere gratitude the support of its esteemed customers, the strength it derives from its association with Companies de Saint-Gobain and a number of its subsidiaries (in particular, Saint-Gobain Abrasives Inc.), the continued support and co-operation from its Bankers and the loyalty of the large family of the Company's Dealers, Suppliers and valued Shareholders.

On behalf of the Board of Directors,

A. C. CHAKRABORTTI A. Y. MAHAJAN

CHAIRMAN MANAGING DIRECTOR

Mumbai; 23rd May, 2012

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Mar 31, 2011

The Directors present the 61st Annual Report of the Company along with the Audited Balance sheet as at 31st March, 2011 and the Profit and Loss account for the financial year ended 31st March, 2011.

Financial Highlights

(Rs. crores)

Twelve Fifteen Months Months Period ended ended 31st March, 31st March, 2011 2010

Net Sales 780.74 702.36

Operating Profit 125.97 122.56

Interest 0.28 0.25 Profit before Tax and

Extraordinary Item 125.69 122.31

Extraordinary Item - 7.72

Profit before Tax and after Extraordinary Item 125.69 130.03

Provision for Tax 40.06 42.52

Profit after Tax 85.63 87.51

Surplus Brought forward 50.00 35.00

135.63 122.51

Appropriations:

Proposed Dividend 33.22 33.22

Tax on Proposed Dividend 5.39 5.52

General Reserve 37.02 33.77

Surplus carried to Balance Sheet 60.00 50.00

135.63 122.51

Responsibility Statement

Your Directors confrm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) appropriate accounting policies have been selected and applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and of the Profit of the Company for that year;

(iii) proper and suffcient care has been taken 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;

(iv) the annual accounts have been prepared on a going concern basis.

Operations

The year under review was an excellent one for your Company with net sales and Profit before tax increasing by a record 39% and by 29% respectively on an annualized basis. The record increase in sales was partly due to the sustained growth of the economy, partly due to re-stocking and partly due to gains in market share. Margins in all businesses were under pressure as severe cost pushes could only be partially offset by price increases.

Dividend

Considering the good results, your Directors recommend a dividend of Rs. 6/- per equity share for the financial year ended 31st March, 2011. The dividend outgo on account of the dividend (excluding tax on dividend) will be Rs. 33.22 crores (previous 15-month period: Rs. 33.22 crores).

Abrasives

The Abrasives business registered an all-time high growth of 41% over the previous period (on an annualized basis). This was mainly due to increase in domestic demand (as most of the end user industries witnessed strong growth), higher sales of new products and in new markets and gains in market share. Higher volume and higher prices (increases effected from time to time) helped the business post a 16% growth in the Operating Profit over the previous 15-month period (45% growth on an annualized basis).

Ceramics & Plastics

Signifcant growth in Steel, Crucible and Metallurgical markets and improved availability of silicon carbide crude from your Companys subsidiary in Bhutan helped the Silicon Carbide business to grow in volumes by more than 40%. Steep increase in power cost adversely affected the Profitability of the business. The High Performance Refractories business and the Performance Plastics business also registered strong growth with the introduction of new products and with the penetration of new markets even as business with the existing customers grew.

Subsidiary in Bhutan

In its frst full year of operations, Saint-Gobain Ceramic Materials Bhutan Pvt. Ltd. made a small operating Profit.

In terms of the approval granted by the Central Government under Section 212(8) of the Companies Act, 1956, vide letter No. 47/107/2011-CL-III dated February 9, 2011 from Ministry of Corporate Affairs, copies of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Auditors of the subsidiary have not been attached with the Balance Sheet of the Company. However, these documents will be made available upon request by any member of the Company. As directed by the Central Government, the financial data of the subsidiary has been furnished under ‘Financial Information of Subsidiary Companies, which forms part of the Annual Report. The Annual Accounts of the Company including that of subsidiary will be kept for inspection by any member. Further, pursuant to Accounting Standard (AS)-21 prescribed under the Companies (Accounting Standards) Rules, 2006, Consolidated Financial Statements presented by the Company include financial information of the subsidiary Company.

Future Prospects

The Indian economy is expected to witness sustained growth in 2011-12, though industrial growth may be moderate. The rise in input prices and infation, in general, are the main concerns. Your Company is well positioned to benefit from growth. With record volume growth in 2010-11, in some businesses, capacities have become a constraint. Your Company will step up its capital expenditure plans in the current year.

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

Your Company is committed to ensure a clean and green, pollution free environment as well as healthier and safer work place at all plant locations and work sites. All the plants of your Company are certifed under ISO 14001:2004 as well as OHSAS 18001:1999. These Certifications are in recognition of the sustained efforts of your Company in-improving Environment, Health and Safety at all its sites.

As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the relevant information pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo as required in the prescribed format is annexed (Annexure A) and forms part of this Report.

Fixed Deposits

At present your Company does not accept any fixed deposits.

Particulars of Employees

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, forms part of this report. However, as per the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the

Companies Act. Any member interested in obtaining such particulars may write to the Company at its Registered Offce.

Management Discussion & Analysis Report and Report on Corporate Governance

The Management Discussion and Analysis Report and the Report on Corporate Governance along with a Certifcate dated 17th May, 2011, of the Auditors of your Company, regarding the compliance of the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are annexed (Annexure B) and form part of this Report.

Directors

In accordance with the requirements of the Companies Act, 1956 and the Articles of Association of the Company, Ms. Marie-Armelle Chupin, Mr. Jean-Pierre Floris and Mr. Patrick Millot retire by rotation and, being eligible, offer themselves for re-appointment as Directors of your Company.

Auditors

M/s.Kalyaniwalla & Mistry, Chartered Accountants,(Registration No.104607W), Auditors of your Company, retire on the conclusion of 61st Annual General Meeting. You are requested to appoint Auditors for the current financial year and to fx their remuneration. The retiring Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants are eligible for re-appointment.

Employee Relations

Your Directors place on record their appreciation of the contribution made by all the employees in the progress of your Company. Employee Relations were generally cordial at all units of the Company. As at the year-end, there were 1594 employees.

Acknowledgments

Your Directors take this opportunity to acknowledge with sincere gratitude, the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and a number of its subsidiaries (in particular, Saint-Gobain Abrasives Inc.), the continued support and co-operation from its Bankers and the loyalty of the large family of the Companys Dealers, Suppliers and valued Shareholders.

On behalf of the Board of Directors,

A. C. CHAKRABORTTI A. Y. MAHAJAN

CHAIRMAN MANAGING DIRECTOR

Mumbai: 17th May, 2011

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Mar 31, 2010

The Directors present the 60th Annual Report of the Company along with the Audited Balance Sheet as at 31st March, 2010 and the Proft and Loss Account for the ffteen months period ended 31st March, 2010.

Financial Highlights

(Rs. Lacs) Fifteen Twelve Months months Period ended ended 31st March, 31st December, 2010 2008 Net Sales 702,36.09 502,11.64 Operating Proft 122,55.64 79,72.11 Interest 25.48 60.55 Proft before Exceptional item 122,30.16 79,11.56 Add : Exceptional Item 7,72.11 - Proft before Tax and after Exceptional Item 130,02.27 79,11.56 Provision for Tax 42,51.70 24,11.02 Proft after Tax 87,50.57 55,00.54 Surplus Brought Forward 35,00.00 25,00.02 122,50.57 80,00.56

Appropriations: Proposed Dividend 33,21.60 22,14.40 Tax on Proposed Dividend 5,51.68 3,76.34 General Reserve 33,77.29 19,09.82 Surplus carried to Balance Sheet 50,00.00 35,00.00 122,50.57 80,00.56

Change in Accounting Year

In order to have a uniform accounting year under various legislations, your Company has decided to change the Accounting year from January - December to April - March. Accordingly, the current Annual Accounts and Report of the Company are for a period of ffteen months from 1st January, 2009 to 31st March, 2010. Therefore, the fgures for the current period are not comparable with those of the year ended 31st December, 2008.

Responsibility Statement

your Directors confrm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) appropriate accounting policies have been selected and applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and of the proft of the Company for that period;

(iii) proper and suffcient care has been taken 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;

(iv) the annual accounts have been prepared on a going concern basis.

Operations

The sharp deceleration of the economy witnessed in the last quarter of 2008 continued in the frst half of 2009. The economy started reviving from the middle of the year and industrial growth, in particular, accelerated from the last quarter of 2009. In line with this, your Company’s sales witnessed a strong recovery in the second half of 2009 and surged in the frst quarter of 2010. Consequently, on an annualized basis, net sales increased by 11.9%. Partly because of this and partly because of higher price realization and lower costs (especially, energy costs and expenses), there was a signifcant increase in your Company’s operating proft (23% higher than 2008 on an annualized basis) and margin (16.4% on annualized basis compared to 14.4% in 2008).

Dividend

Considering the good results, your Directors recommend a dividend of Rs. 6/- per equity share for the period ended 31st March, 2010. The dividend outgo (excluding tax on dividend) will be Rs. 33,21.60 lacs (previous year Rs. 22,14.40 lacs.)

Abrasives

The period under review started with very weak demand conditions. But, the second half of 2009 witnessed a strong and sustained recovery in domestic demand, which continued in the frst quarter of 2010. Consequently, on an annualized basis, sales increased by 7.8%. Partly due to this as also on account of higher price levels and lower costs, profts and proftability increased signifcantly.

Ceramics & Plastics

With business conditions improving as the year progressed and lower costs, the Silicon Carbide business had an excellent year in terms of sales and profts. While the High Performance

Refractories business had a diffcult year, the Performance Plastics business saw a strong recovery in the latter part of the year.

The “wheeling charges” matter is still pending before the Honourable Supreme Court. Based on an internal review of this long pending matter and on legal advice, the provision of Rs. 7,72.11 lacs has been reversed during the period under review and is shown as an exceptional item in the fnancial statements.

Subsidiary in Bhutan

In May 2009, the Silicon Carbide plant of Saint-Gobain Ceramic Materials Bhutan Private Limited, a subsidiary of your Company, commenced commercial production. The start-up has been smooth and production has been ramped up gradually. The subsidiary has achieved break even at the operating proft level in its frst year of operation.

Future Prospects

The strong growth of the economy witnessed in the last few months is likely to be sustained. your Company is well placed to beneft from this growth. your Company’s priorities have shifted from costs and cash to volumes (penetrating new markets while strengthening position in existing markets).

Financial Statement of the Subsidiary

Under Section 212(8) of the Companies Act, 1956, the Ministry of Corporate Affairs (MCA), has vide approval letter no. 47/252/2010-CL-III dated 23rd April, 2010 granted exemption from attaching the fnancial statement of the subsidiary Company to your Company’s accounts for the period ended 31st March, 2010. However, the consolidated fnancial statement forms part of this Annual Report and contains information of the subsidiary company pursuant to the approval letter of MCA viz. capital, reserves, total assets, and total liabilities, details of investment, turnover, proft before tax, provision for tax and proft after tax.

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

your Company is committed to ensure a clean and green, pollution free environment as well as a healthy and safe work place at all plant locations and work sites. In January 2010, the new Abrasives plant in Himachal Pradesh having been certifed under Integrated Management System (ISO and OHSAS), all the plants of your Company are certifed under ISO 14001:2004 as well as OHSAS 18001:1999. These Certifcations are in recognition of the sustained efforts of your Company in improving the Environment, Health and Safety at all its work sites.

As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the relevant information pertaining to conservation of energy, technology

absorption and foreign exchange earnings and outgo as required in the prescribed format is annexed (Annexure A) and forms part of this Report.

Fixed Deposits

At present, your Company does not accept any fxed deposits.

Employee Relations

your Directors place on record their appreciation for the contribution made by all the employees in the progress of your Company. Employee Relations were generally cordial at all units of the Company. As at the year-end, there were 1466 employees.

Acknowledgments

your Directors take this opportunity to acknowledge with sincere gratitude the support of its esteemed customers, the strength it derives from its association with Compagnie de Saint-Gobain and a number of its subsidiaries (in particular, Saint-Gobain Abrasives Inc.), the continued support and co-operation from its Bankers and the loyalty of the large family of the Company’s Dealers, Suppliers and valued Shareholders.

Particulars of Employees

Information as per Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, forms part of this report. However, as per the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent excluding the statement containing the particulars to be provided under Section 217(2A) of the Act. Any member interested in obtaining such particulars may write to the Company for a copy thereof.

Management Discussion & Analysis Report and Report on Corporate Governance

The Management Discussion and Analysis Report and Report on Corporate Governance, alongwith a Certifcate dated 18th May, 2010 of the Auditors of your Company, regarding the compliance of the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges is annexed (Annexure B) and forms part of this Report.

Directors

Mr. R. K. Bilimoria and Mrs. D. S. Variava resigned as Directors of your Company with effect from 5th June, 2009.

Mr. Bharat S. Raut, Director of your Company, will step down at the conclusion of the forthcoming Annual General Meeting as he has opted not to seek re-election due to personal reasons. your Board has resolved not to fll the vacancy so caused at this time.

The Board of Directors places on record its deep appreciation of the valuable services and contribution made by Mr. Bilimoria, Mrs. Variava and Mr. Raut during their tenure.

Mr. M. M. Narang was appointed as an additional director, with effect from 24th February, 2010.

Mr. Narang holds offce upto the date of the forthcoming 60th Annual General Meeting of the Company. As required under Section 257 of the Companies Act, 1956, the Company has received notice in writing from Members proposing the candidature of Mr. Narang as Director of the Company.

In accordance with the requirements of the Companies Act, 1956 and Articles of Association of the Company, Mr. A. C. Chakrabortti and Mr. J. T. Crowe retire by rotation and being eligible, offer themselves for reappointment as Directors of your Company.

Auditors

M/s. Kalyaniwalla & Mistry, Chartered Accountants, Auditors of your Company, retire on the conclusion of 60th Annual General Meeting. you are requested to appoint Auditors for the current fnancial year and to fx their remuneration. The retiring Auditors, M/s. Kalyaniwalla & Mistry, Chartered Accountants are eligible for re-appointment.

On behalf of the Board of Directors, A. C. CHAKRABORTTI A. Y. MAHAJAN CHAIRMAN MANAGING DIRECTOR Mumbai: 18th May, 2010