Director Report

To the Members,

The Directors are pleased to present the Annual Report for the Financial Year 2022-23 together with the audited financial statements of the Company for the financial year ended March 31, 2023.

FINANCIAL SUMMARY/HIGHLIGHTS

The financial results of the Company are elaborated in the report on Management Discussion and Analysis. Given below are the financial highlights.

Standalone

FY23 closed with Revenues of 5,356 crores, EBITDA of 916 crores, PAT of 75 crores and EBITDA margins of_17.1%.

Consolidated

FY23 closed with Revenues of 6,925 crores, EBITDA of 931 crores, Net Profit attributable to owners of the Company 141 crores and EBITDA margins of 13.4%.

OPERATIONS

With a strong global presence spanning four continents and serving customers across over 100 countries, STL is a trusted name in the industry. Our expert offerings in Optical Connectivity, Global Services, and Digital and Technology solutions have won us the trust of leading names in telecom, cloud, citizen networks, and large businesses. In the US, STL's fibre optic and connectivity solutions are helping the country build ubiquitous broadband networks. STL has strengthened its presence with an advanced manufacturing facility in South Carolina. STL has been front and centre of the UK's digital transformation journey for more than 10 years. The company's optical cable and interconnect offerings and network deployment expertise have pushed it to the centre of ‘Project Gigabit' in the UK. STL has strengthened its capabilities by setting up an Optical and Services Centre of Excellence. We are serving the optical and network build needs of our UK-based customers with design innovation and shorter lead times through our optical cable and interconnect manufacturing setups in Italy. In Europe, STL is driving design innovation in the optical network space to support national connectivity programs and help build ubiquitous broadband, FTTx, and 5G networks. Through its advanced Optical Fibre cable (OFC) and Optical Interconnect facilities in Italy, STL has helped in meeting the fibre demand and expedited fibre rollouts across the European region. The company's optical solutions are helping accelerate 5G connectivity and smart living in the Middle East, and are driving digital inclusion in Africa. STL has a centre of excellence in Dubai that integrates R&D and product development for the region. STL started its journey in Australia in 2020 when it became the trusted optical partner for the second-largest telecom operator in Australia. Since then, it has been an integral part of the region's digital transformation journey.

We're excited to share that in May 2023, our board approved the demerger of our Global Services business, which will pave the way for unlimited growth opportunities. We recently formed STL Digital, a dedicated team that specializes in engineering amasing digital experiences for customers in various industries such as telecom, technology, manufacturing, and healthcare. We can't wait to see what the future holds for our company!

Early in FY23, we shared our strategic intent to drive focused growth. Taking action on this plan, we exited three less profit-making businesses in FY23. We divested our IDS business to Hexatronic group for ~GBP 14 million. We also sold the telecom software products business to Skyvera, an affiliate for US-based Telco DR for ~US$15 million, and in Q4FY23, we exited the wireless business.

As a company, we are strongly driven by our purpose of ‘Transforming Billions of Lives by Connecting the World'. This purpose serves as a north star for our Environment, sustainability and Governance (ESG) efforts. While delivering advanced optical and digital solutions for future-ready networks, we are constantly looking for ways to create value in our communities and for the environment. STL is championing sustainability and has committed to becoming Net Zero by 2030. We keep sustainability at the core of our manufacturing operations. At STL, waste management is one of the most fundamental ways the company drives its sustainability agenda. Four of our manufacturing units in India are Zero Waste to Landfill certified by Intertek, a US Quality Assurance provider. The Rakholi, Dadra and Shendra plants have received Level 1 certification for diverting more than 99% of waste. STL's Waluj plant has received a Level 2 certification for diverting more than 96% of waste from landfills. STL aims to have all its plants across the globe certified over the next few years. We continue to ensure Zero Liquid Discharge across 100% of our optic fibre plants in drought-prone Aurangabad, Maharashtra.

BUSINESS RESTRUCTURING

The Board of Directors in its meeting held on May 17, 2023 approved Scheme of Arrangement whereby the Global Services Business will be demerged into STL Networks Limited, a wholly owned subsidiary of the Company, on a going concern basis, under the provisions of Section 230 to 232 of the Companies Act, 2013, subject to, inter-alia, receipt of approvals from the shareholders and creditors of the Company, as may be directed by the National Company Law Tribunal, Mumbai Bench, Securities and Exchange Board of India (SEBI) BSE Limited (BSE), National Stock Exchange of India Limited (NSE) and approval of other regulatory or statutory authorities as may be required. Pursuant to the Scheme, the Resulting Company will be listed on the BSE and NSE.

DIVIDEND AND DIVIDEND DISTRIBUTION POLICY

The Board of Directors (‘the Board') is pleased to recommend a final dividend of 1/- per Equity Share (i.e._50%) of 2/- each for the FY23. For the FY22, the dividend paid was 0.50/- per share (i.e. 25%) of 2 each. The distribution of dividend will result in payout of around 39.86 crores (excluding tax) on dividend. The dividend payout is subject to approval of shareholders at the ensuing Annual General Meeting (‘AGM'). The Company proposes not to carry any amount to reserves for the FY23. In terms of the provisions of the Income Tax Act, 1961, the dividend, if declared, will be taxable in the hands of the shareholders subject to tax deduction at source at the applicable rates. For further details on taxability, please refer to annexure to the Notice of Annual General Meeting. The Dividend Distribution Policy of the Company, in terms of Regulation 43A of the Securities and Exchange Control Board of India (SEBI) (Listing Obligations and Disclosure Requirements), Regulations, 2015 (‘Listing Regulations'), is available on the website of the Company at https://www.stl.tech/Code-of-Conduct-and-Policies.html The dividend recommended is in accordance with the principles and criteria as set out in the dividend distribution policy.

SHARE CAPITAL

The paid-up equity share capital as on March 31, 2023 was 79.68 crores. There was no public issue, rights issue, bonus issue or preferential issue etc. during the year. The Company has not issued shares with differential voting rights or sweat equity shares.

CORPORATE GOVERNANCE

A Report on Corporate Governance, in terms of Regulation 34 of the Listing Regulations, along with a Certificate from Practising Company Secretary, certifying compliance of conditions of Corporate Governance enumerated in the Listing Regulations, is presented in a separate section forming part of this Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, giving detailed analysis of Company's operations, as stipulated under Regulation 34 of the Listing Regulations, is presented in a separate section forming part of this Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)`

In compliance with the Listing Regulations, the Company has included a separate section on Business Responsibility and Sustainability as a part of this Annual Report.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no adverse material changes or commitments occurred between the end of financial year and date of this report, which may affect the financial position of the Company or may require disclosure.

BOARD MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. During FY23, seven meetings of the Board of Directors were held on April 28, 2022; July_25, 2022; October 13, 2022; November 4, 2022; December_6, 2022; January 27, 2023 and February 23,_2023. The maximum time-gap between any two consecutive meetings did not exceed one hundred and twenty days.

COMPOSITION OF AUDIT COMMITTEE

The Audit Committee of the Board comprises of Mr._S._Madhavan – Chairman, Ms. Kumud Srinivasan – Member, Mr. Sandip Das – Member and Mr. Pravin Agarwal – Member. All recommendations given by Audit Committee during FY23 were accepted by the Board. Further details on the Audit Committee and other Committees of the Board are given in the Corporate Governance Report, which forms a part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Pursuant to the recommendation of the Nomination & Remuneration Committee (NRC), the Board, in its Meeting held on April 28, 2022, approved re-appointment of Mr. Sandip Das as an Independent Director of the Company for a second term of two consecutive years with effect from October 16, 2022 to October 15, 2024 and the same was approved by the members at their Annual General Meeting held on August 26, 2022.

Mr. Ankit Agarwal was appointed as Managing Director for five consecutive years with effect from October 08, 2021 upto October 07, 2026 by the members at their Annual General Meeting held on August 26, 2022.

Pursuant to Section 149 read with Section 152 of the Companies Act, 2013 (‘the Act'), Mr. Anil Agarwal (DIN 00010883), Chairman and Non-Executive Director will retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. The Board recommends his appointment. Members of the Company, in the Annual General Meeting held on June 26, 2018 had approved the appointment of Ms. Kumud Srinivasan as an Independent Director for a period of five years from May 22, 2018 upto May 21, 2023. Upon the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on May 17, 2023, approved the re-appointment of Ms. Kumud Srinivasan as an Independent Director of the Company for a second term of two years with effect from May 22, 2023 to May 21, 2025 based on the skills, experience, knowledge and report of her performance evaluation. The re-appointment is subject to the approval of the members at the ensuing Annual General Meeting by way of a Special Resolution.

Details of the aforesaid proposals for appointment are provided in the Annexure to the Notice of the AGM. The Company has received necessary declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under section 149(7) of the Act and Regulation 16 and 25 of the Listing Regulations. The Independent Directors of the Company have also registered themselves in the databank with the Indian Institute of Corporate Affairs and confirmed compliance of relevant provisions of Rule 6 of the Companies (Appointments and Qualifications of Directors) Rules, 2014. The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise and they hold the highest standards of integrity. Mr. Mihir Modi, stepped down as a Chief Financial Officer (CFO) and Key Managerial Personnel of the Company, effective October 14, 2022 and Mr. Tushar Shro_ was appointed as a Chief Financial Officer of the Company effective December 06, 2022.

In terms of provisions of Section 203 of the Act, and the Rules made thereunder, following are the Key Managerial Personnel (KMP) of the Company:

1. Mr. Ankit Agarwal – Managing Director

2. Mr. Tushar Shro_ – Chief Financial Officer

3. Mr. Amit Deshpande – Company Secretary

PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors of the Company is committed to assessing its own performance as a Board in order to identify its strengths and areas in which it may improve its functioning. To that end, the NRC has established processes for performance evaluation of Independent Directors, the Board and Committees of the Board. Pursuant to the provisions of the Act and the Listing Regulations, the Board has carried out an annual evaluation of its own performance, performance of its Committees as well as the Directors individually. Details of the evaluation mechanism are provided in the Corporate Governance Report.

The Board has, on the recommendation of the NRC framed a policy for selection and appointment of Directors, Senior Management and their remuneration (‘NRC Policy'). The NRC Policy of the Company includes criteria for determining qualifications, positive attributes and independence of a director and policy relating to the remuneration of Directors, Key Managerial Personnel and other employees. The NRC Policy is framed with the object of attracting, retaining and motivating talent which is required to run the Company successfully. The Policy can also be accessed on Company's website at the link: https://www.stl.tech/Code-of-Conduct-and-Policies.html

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to provisions of Section 134(3)(c) and Section 134(5) of the Act, Directors, to the best of their knowledge and belief, state that: a) in the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same; b) the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year April 1, 2022 to March 31, 2023; c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the Directors have prepared the annual accounts on a ‘going concern' basis; e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

COMPLIANCE WITH SECRETARIAL STANDARDS

Directors confirm that the Secretarial Standard - 1 on Meetings of Board of Directors and Secretarial Standard – 2 on General Meetings, issued by The Institute of Company Secretaries of India, have been duly complied with.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts and arrangements with related parties, entered by the Company during the financial year, were in the ordinary course of business and on an arm's length basis, except for those which were specifically approved by the Board (for transactions not in ordinary course).

There were no material contracts or arrangements or transactions entered into during the year ended March 31, 2023.

Details regarding the policy, approval and review of Related Party Transactions are provided in the Corporate Governance Report.

SUBSIDIARIES AND JOINT VENTURES

In accordance with Section 129(3) of the Act, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided as part of the consolidated financial statement. Hence, a separate report on the performance and financial position of each of the subsidiaries and joint venture companies is not repeated here for the sake of brevity. This also includes highlights of performance of Sterlite Global Ventures (Mauritius) Limited, Metallurgica Bresciana S.p.A. Sterlite Technologies Inc., USA and Sterlite Tech Cables Solutions Limited which are material subsidiaries of the Company.

During FY23, STL Digital UK Limited became a subsidiary of the Company: During FY23, your Company transferred of its Digital Business Undertaking to STL Digital Limited, a wholly owned subsidiary of the Company as a going concern on a slump sale basis. During FY23, the Company entered into definitive documents to acquire balance 25% stake (through its wholly-owned subsidiary) in Jiangsu Sterlite Fiber Technology Co., Ltd._(JSFTCL) (Formerly known as Jiangsu Sterlite Tongguang Fiber Co. Ltd.). The acquisition of 25% stake in JSFTCL has been completed on December 14, 2022. The Company now holds 100% shares of JSFTCL through its wholly owned subsidiaries in China and Mauritius.

During FY23, the following have ceased to be subsidiaries of the Company:

• Sterlite Global Venture (Mauritius) Limited ("SGVML") (a wholly owned subsidiary of the Company), divested its entire stake (amounting to 80% of the entire share capital) held in Impact Data Solutions Limited, UK

("IDS UK") to Hexatronic Group AB (publ.). Consequent to the Transaction, IDS UK and its wholly owned subsidiary Impact Data Solutions BV, ceased to be the subsidiaries of SGVML and step-down subsidiaries of the Company respectively effective October 04, 2022.

• STL Tech GmbH has been closed with effect from October 18, 2022.

• Sterlite Technologies Inc, USA merged with Sterlite Tech Holding Inc., USA effective April 1, 2023.

The Company has complied with Foreign Exchange

Management (Non-debt Instruments) Rules, 2019, as amended, for the downstream investments made during the year. Policy on material subsidiaries, as approved by the Board of Directors, can be accessed on the Company's website at https://www.stl.tech/Code-of-Conduct-and-Policies.html The Audited Financial Statements of the Subsidiary Companies have not been included in the Annual Report. The financial statements of the Subsidiary Companies and the related information will be made available, upon request, to the members seeking such information at any point of time. These financial statements will also be available on the Website of the Company at https://www.stl.tech/downloads.html

FINANCIAL STATEMENTS

Pursuant to various circulars issued by the Ministry of Corporate Affairs and SEBI, the Company shall not be dispatching physical copies of the Annual Report and shall be sent only by email to the members. However, copies of the Annual Report will be provided to the members uponfirequest.

The consolidated financial statements of the Company prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015, duly audited by Statutory Auditors, also forms part of this Annual Report.

STATUTORY AUDITORS

M/s. Price Waterhouse Chartered Accountants LLP (Firm Registration No. 012754N/N500016) (‘PWC') has been appointed as the Statutory Auditors in the Annual General Meeting held on August 26, 2022 for the second term of five consecutive years from the conclusion of 23^rd Annual General Meeting till the conclusion of 28__ Annual General Meeting of the financial year for 2027.

STATUTORY AUDITOR'S REPORT

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors, in their report for the financial year ended March 31, 2023.

SECRETARIAL AUDITOR

Pursuant to Section 204 of the Act, Mr. Jayavant B Bhave, Practising Company Secretary, was appointed to conduct the Secretarial Audit of the Company, for the financial year ended March 31, 2023. The Report of the Secretarial Auditor is annexed as Annexure I to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

COST AUDITOR

The Company is required to make and maintain cost records for certain products as specified by the Central Government under sub-section (1) of section 148 of the Act. Accordingly, the Company has been making and maintaining the records as required.

Pursuant to Section 148 of the Act, read with The Companies (Cost Records and Audit) Rules, 2014, the cost audit records maintained by the Company are required to be audited. Mr Kiran Naik, Cost Accountant, was appointed as the Cost Auditor to audit the cost accounts of the Company for said products for FY23 and the audit is ongoing. Cost Audit Report for FY23 will be filed with the Registrar of Companies within the prescribed timelines.

The Board of Directors has approved the appointment of Mr. Kiran Naik as Cost auditor for FY 24 at a remuneration of Rs. 110,000. Mr. Kiran Naik, being eligible has consented to act as a Cost auditor. As required by the provisions of the Act, a resolution seeking Members' approval for the remuneration payable to Mr Kiran Naik, Cost Auditor for FY24 is included in the Notice convening the ensuing AGM.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and the Company has, in all material respects, maintained adequate internal financial controls over financial reporting as of March 31, 2023 and are operating effectively. The Board of Directors has devised systems, policies and procedures/frameworks, which are currently operational within the Company for ensuring the orderly and efficient conduct of its business, which includes adherence to Company's policies, safeguarding assets of the Company, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. In line with best practices, the Audit Committee and the Board reviews these internal controls to ensure they remain effective and are designed to achieve their intended purpose. Where weaknesses, if any, are identified as a result of the reviews, corrective and preventive actions are then put in place to strengthen controls. The systems/frameworks include proper delegation of authority, operating philosophies, policies and procedures, effective IT systems aligned to business requirements, an internal audit framework, an ethics framework, a risk management framework and adequate segregation of duties to ensure an acceptable level of risk. The Company has documented Standard Operating Procedures (SOP) for key functions such as for procurement, project/expansion management, capital expenditure, human resources, sales and marketing, finance, treasury, compliance management, safety, health, and environment (SHE), and manufacturing. The Company's internal audit activity is managed through the Management Assurance Services (‘MAS') function. It is an important element of the overall process by which the Audit Committee and the Board obtains assurance on the effectiveness of internal controls over financial reportings.

The scope of work including annual internal audit plan, authority, and resources of MAS are regularly reviewed and approved by the Audit Committee. Annual internal audit plan is aligned with ERM to ensure that all critical risks are covered in the audit plan. Besides, its work is supported by the services of leading international audit firms. The annual internal audit includes: monthly physical verification of inventory and review of accounts/MIS and a quarterly review of critical business processes. To enhance internal controls, the internal audit follows a stringent grading mechanism, monitoring and reporting of the implementation of internal auditors' recommendations of internal audit. The internal auditors make periodic presentations on audit observations, including the status of follow-up to the Audit_Committee.

DETAILS REGARDING FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12)

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor has reported to the Audit Committee, under Section 143(12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Boards' report.

STATUTORY COMPLIANCE MANAGEMENT

The Company mitigates its legal and regulatory compliance risks with the help of an online compliance management tool. It is a well-defined system for storing, monitoring and ensuring compliances under various legislations. Non-compliances, if any, are reported and corrective actions are taken within a reasonable time. Any regulatory amendment is updated periodically in the system. Based on reports from the system and certificates from functional heads, the Managing Director presents the quarterly compliance certificate to the Board at the Board meetings.

BUSINESS RISK MANAGEMENT

The Company has formally implemented Enterprise Risk Management framework and has policy to identify and assess the risk events, monitor and report on action taken to mitigate identified risks. A detailed exercise is carried out periodically to identify, evaluate, manage and monitor both business and non-business risk. The Audit Committee and the Board of Directors periodically review the risk and suggest steps to be taken to control and mitigate the same through a properly defined framework. Details of Risk Management are presented in a separate section forming part of this Annual Report.

This framework, inter alia, includes identification of internal and external risks faced by the Company, including financial, operational, sectoral, sustainability, information, cyber security, strategic or any other risk as may be determined by the Risk Management Committee and the measures for risk mitigation, reporting of critical risks within the Company and Business Continuity Plan. The Risk Management Committee of the Board comprises of Ms. Kumud Srinivasan as the Chairperson and Mr. Sandip Das, Mr. Ankit Agarwal and Mr. Tushar Shro_ as Members.

WHISTLE BLOWER MECHANISM

The Company has established a vigil mechanism and formulated the Whistle Blower Policy (WB) to deal with instances of fraud and mismanagement, if any. The details of the WB Policy are explained in the Corporate Governance Report and also posted on the website of the Company.

DISCLOSURE REGARDING PREVENTION OF SEXUAL HARASSMENT

The Company is committed to maintaining a productive environment for all its employees at various levels in the organisation, free of sexual harassment and discrimination on the basis of gender. The Company has framed a policy on Prevention of Sexual Harassment in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 ("POSH Act"). The Company has also set up "Prevention of Sexual Harassment Committee, which is in compliance with the requirement of the POSH Act, to redress the Complaints received regarding sexual harassment which has formalised a free and fair enquiry process with clear timeline. During the financial year, Company received one complaint under the POSH Act which has been closed as on the date of this Report.

The Company is already in compliance with the directions issued by the Honorable Supreme Court of India in May 2023 for the proper implementation of POSH Act.

EMPLOYEES STOCK OPTION SCHEME

The Company's Employee Stock Option Schemes are in line with Company's philosophy of sharing benefits of growth with the growth drivers and are in compliance with the applicable SEBI Regulations. The Company allotted 8,23,648 shares during the year to various employees who exercised their options. The Certificate from the Secretarial

Auditor confirming that the Scheme has been implemented in accordance with the SEBI Regulations and the resolution passed by the shareholders would be placed at the AGM for inspection by member.

Disclosures with respect to Stock Options, as required under Regulation 14 of the Regulations, are available in the Annexure II to this Report, Notes to the Financial Statements and can also be accessed on the Company's website at https://www.stl.tech/downloads.html

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule_5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided as Annexure III to this Report.

A statement containing particulars of employees as required under Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided as a separate annexure forming part of this Report. However, the Annual Report is being sent to the members excluding the aforesaid annexure. The said information is available for electronic inspection during working hours and any member interested in obtaining such information may write to the Company Secretary or Registrar and Transfer Agent and the same will be furnished on request.

ANNUAL RETURN

In terms of Section 92(3) of the Act, the annual return of the_Company for the financial year ended March 31, 2023 shall be available on the Company's website https://www.stl.tech/investors.html

NON-CONVERTIBLE DEBENTURES

During FY23, your Company raised 100 crores through issuance of 10,000 Secured, Rated, Redeemable, Non-Cumulative, Non-Convertible Debentures (NCDs) of face value of 1,00,000 each on private placement basis. As on March_31,_2023, the Company has outstanding Secured, Rated, Redeemable, Non-Convertible Debentures (NCDs) of 540_crores. The Company has maintained asset cover sufficient to discharge the principal amount along with outstanding Interest at all times for its NCDs. NCDs are listed on the debt segment of BSE Limited, as per the SEBI Guidelines and Listing Regulations. The details of debenture trustee are as below–

Axis Trustee Services Limited

The Ruby, 2nd Floor, SW

29 Senapati Bapat Marg, Dadar West

Mumbai- 400 028_

Contact No.: +91- 022-6230 0438

CREDIT RATING

The Company's financial discipline is reflected in the strong credit rating ascribed by ICRA/CRISIL:

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements.

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

The particulars of conservation of energy, technology absorption and foreign exchange earnings and outgo as prescribed under Section 134(3)(m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014, are given as Annexure IV to this Report.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to the provisions of Section 124 of the Act, relevant amounts which remained unpaid or unclaimed for a period of seven years have been transferred by the Company to the Investor Education and Protection Fund established by Central Government. Details of unpaid and unclaimed amounts lying with the Company as on March_31,_2023 have been uploaded on the Company's website at_https://www.stl.tech/latest disclosure.html

TRANSFER OF ‘UNDERLYING SHARES' TO IEPF

In terms of Section 124(6) of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has transferred the equity shares in respect of which dividends have remained unclaimed for a period of seven consecutive years to the IEPF Account established by the Central Government. Details of shares transferred have been uploaded on the website of the Company.

CORPORATE SOCIAL RESPONSIBILITY

The Board has constituted Sustainability and Corporate Social Responsibility Committee (‘CSR Committee') which comprises Mr. B. J. Arun, Chairman, Mr. Sandip Das, Mr_Pravin Agarwal and Mr. Ankit Agarwal, Members. The Board has also approved a CSR policy on recommendations of CSR Committee, which is available on the website of the Company at https://www.stl.tech/Code-of-Conduct-and-Policies.html As part of its initiatives under Corporate Social Responsibility, the Company has undertaken projects in the areas of Education, Health, Women Empowerment and Community Development during FY23.

During the year, the Company has spent 7.90 crores on CSR activities. The Annual Report on CSR activities, in accordance with Section 135 of the Act, read with Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure V to this Report.

GENERAL

Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: a) The Company has not accepted any deposits from the public or otherwise in terms of Section 73 of the Act read with Companies (Acceptance of Deposit) Rules, 2014 and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the Balance Sheet. b) The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise. c) The Whole-time Directors of the Company do not receive any remuneration or commission from any of its subsidiaries.

d) No significant or material orders were passed by the Regulators, Courts or Tribunals which impact the going concern status and Company's operations in future. e) The Auditors have not reported any matter under Section 143 (12) of the Act, therefore no details are required to be disclosed under Section 134 (3)(ca) of the Act. f) No application has been made under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("the IBC, 2016"), hence, the requirement to disclose the details of application made or any proceeding pending under the IBC, 2016 during the year along with their status as at the end of the financial year is not applicable. g) The requirement to disclose the details of difference between amount of the valuation done at the timeof onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

ACKNOWLEDGEMENT

Directors would like to express their appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Directors take on record their deep sense of appreciation to the contributions made by the employees through their hard work, dedication, competence, support and co-operation towards the progress of our Company.

For and on behalf of the Board of Directors

Place: Pune Date: May 17, 2023

ANNEXURE II

Details of Stock Options as on March 31, 2023

Statement as on March 31, 2023 for Employee Stock Option Scheme, 2010 as required under Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

a) Assumptions under Black Scholes Option Pricing:

Assumptions used are as follows:

• Fair value of the options calculated by using Black-Scholes option pricing model.

• Stock price: The closing price on NSE as on the date of grant has been considered for valuing the options granted.

• Expected Volatility: The daily volatility of the stock prices on NSE till the date of grant corresponding with the expected life of the options has been considered to calculate the fair value of the options.

• Risk free interest rate: The risk free interest rate on the date of grant considered for the calculation is the interest rate applicable for a maturity equal to the expected life of the options based on the zero coupon yield curve for Government Securities.

• Time of Maturity/Expected Life: Time of Maturity/ Expected Life of option is the period for which the Company expects the option to be live. The minimum life of a stock option is the minimum period before which the options cannot be exercised and the maximum life is the period after which the options cannot beflexercised.

• Expected dividend yield: Expected dividend yield has been calculated on the dividend prior to the date of the grant.

b) Assumptions under Monte Carlo Simulation model

Vesting of options is dependent on the shareholder return during the performance period as compared to comparator group identified by Nomination and Remuneration Committee. The Monte Carlo model requires the following variables of the company and comparator group companies.

• Historical share price and expected volatility during the performance period

• Risk free interest rate of the country where stock of comparator group is listed

• Dividend yield based on historical dividend payments

• Estimate of correlation coe_cients for each pair of company

Assumptions used are as follows:

ANNEXURE III

A. Remuneration disclosures for Executive Directors and Key Managerial Personnel (KMP) for the financial year ended March 31, 2023

In crores

1. Remuneration to Non-Executive Independent Directors for the above purposes does not include sitting fees paid to them for attending Board/Committee meetings.

2. As the liability for leave encashment and Gratuity is provided on an actuarial basis for the Company as a whole, the said amounts are not included above in the remuneration of Directors and KMPs. The remuneration of KMPs also includes perquisites value of Employee Stock Options (ESOPs) exercised, if any.

B. The percentage increase in the median remuneration of employees in the financial year is 5.79% C. The number of permanent employees on the rolls of company as on March 31, 2023 is 3140

D. Average percentile increase made in the salaries of employees other than the managerial personnel in the last financial year viz. FY 23 was 7.05% E. It is hereby afirmed that the remuneration paid is as per the as per the Remuneration Policy for Directors, Key Managerial

Personnel and other Employees.

ANNEXURE IV

1. The steps taken or impact on the conservation of energy.

Rakholi Plant:

In FY22-23, various initiatives are taken up across our plants which has contributed to decrease in energy consumption and hence the carbon footprint. a. Timer installation on All Office AC & Street lights. b. Installation of motion sensors to the Office_lighting. c. Installation of Portable Chillers at individual lines to save load on main chiller to save 20000 units. d. Installation of portable compressor in dispatch & packing areas to save load on main compressor & to save around 10000 units, 90000. e. Water level sensors installed on all tanks to avoid water wastage due to overflow. f. Upgraded UPS for energy saving mode to run on 20% higher efficiency. g. PHE upgraded for Bu_ering machines to improve efficiency by 20%.

OFC Waluj:

• Revision in Electricity board power contract demand and gain annually saving on power_bill.

• STP to recycle the water & the recycled water is used for gardening purposes.

• Installation of latest IGBT technology UPS, which provides 95% efficiency compare to old rectifier technology with below 90% efficiency.

• Replacement of overhead pumps of chilled water circulation with submersible single pump, having almost half of the power_rating.

• Substantial energy saving project implemented in Sheathing lines, below 5_mpm line speed, Extruder and caterpillar will stop functioning automatically and saving both energy and raw material.

• Roof Top Green Solar Energy of 625kwp Installed and connected.

• Old roof lights of reliability lab are replaced will low power LED lights. Power saved and_visibility.

• High Recovery RO plant with RO reject to usage in washroom and gardening.

• Aluminum air pipeline installed that have low friction during flow of air thereby resulting in high efficiency of compressor and low air losses.

• Centralised Utilities Building going live expected energy saving by 10 to 15%.

• Latest technology & highly efficient equipment selection with 100% redundancy (Dry transformer/UPS/RMU/Type Tested panels/HVAC/Cooling Towers/Pumps).

• New PEB shed with roof sky light design to reduce day time plant lighting load.

• Revamp the chilled water circulation pumping system with submersible improving reliability of system.

• Centralised SCADA system for Utility section under new project design phase completed.

• Machine running hours being tracked to increase the OEE of machines through efficient planning.

• Process tanks with insulation cladding and inside FRP coating are been used for energy loss reduction.

• Compressed air Saving:-

Buffering machines replaced with new ring knife type air wipers.

FG lines interlocked with extruder so that it will only work when extruder.

Buffering lines interlocked with take up so that it will only work when take up is on.

• Replacing old plant lights with more efficient LED light for power saving as well to get better visibility.

• Making arrangement of lights-switching with alternate arrangements so that we can turn on/o_ the lights as per requirement.

• DC motors of production machines are being replaced by high efficiency AC motors. Power saving and less maintenance.

• The interlocking of Cooling tower Fan with CT sump water temperature to save fan motor running time.

• Pressure regulators applied in FG line air wipers to get the optimum utilisation of wipers at the lowest possible air pressure. This will save the air and thus the running hours of the air compressors will befireduced.

• Running cooling tower with VFD's and Common Header of all CT.

• Installed the Motion Sensor/LDR and timers for office & street Light & Air Condition Unit to reducing power consumption.

• Heat exchangers (PHE) installation for all sheathing & Buffering line in plant to reduce the load on chillers.

• Installation of water level sensors at collection tanks to contribute towards maintaining optimum level of water for the chillers and help towards power saving.

• HVAC system

New generation inverter compressors can be handle variable compression rations effectively and handle variable load requirement efficiently.

The special electronic expansion valves with 3000 steps used in these systems will take care of precise control of temperature. The machines can also precisely regulate the capacity based on the internal loads and external ambient. The features offer phenomenal 25% annualised power saving compared to any conventional system.

• Utilising alternate sources of energy.

More Solar Power Capacity to Install on roof top and parking shed. Exploring for power exchange alternative from solar & wind power.

• Rain Water Harvesting

Implementation of Rain water harvesting in the plant with a harvesting potential with a provision to use water back into process.

• Food Composter machine

100kg per day installed for converting the canteen food waste in to manure.

Shendra Draw Plant:

a. Replacement of old filters in AHU. Annual Energy Saving at 37Hz is 74748 Units.

b. Descaling of MEE plant, Chiller units & cooling tower fills change. Energy saving since July 2022 is 104483.

c. Optimisation of Chiller consumption by changing set point. Annual Energy Saving 94104 Units.

d. Automation of UV lamp push blower. Annual energy saving 13464.

e. Installation of load manager which helped in optimising contract demand. Energy saving 3.6 Lac units.

Waluj and Gaurav Plant:

a. Installation of VFD in AHU 7, 18, 21, 31. Annual Energy Saving at 40Hz is 413849 Units.

b. Installation of 19 nos. motion sensors to the lighting. Annual Energy saving 37002 Units.

c. Optimisation of AHU consumption by changing set point. Annual Energy Saving 1.58 Lac Units.

d. Optimisation of PAC consumption by changing set point. Annual Energy Saving 9000 Units.

e. Installation of timers for E1, E2 & E3 office_AC's.

f. Arresting the air leakages from the ducting by installation of additional nut-bolt. & applying the silicone sealant and fill up the gaps to prevent small leakages.

g. All non-production area (service floor, admin, utility building) lights take on timer and motion sensor.

2. The steps taken by the Company for utilising alternate sources of energy.

Rakholi Plant:

a. Working for Solar Energy with sustainability team, without any investment.

b. Installation of High Recovery RO plant, with automation and new technology.

Shendra Draw Plant:

a. Installed motion sensors in offices, service floor, battery room, UPS room, canteen, EHS & washrooms to contribute towards saving_power.

b. Street lights operation automation.

c. Old CFL lights being converted to LED lights in phase 1 & 2 area of draw tower.

Waluj and Gaurav Plant:

a. Installed motion sensors in offices, service floor, battery room, UPS room, canteen, EHS & washrooms to contribute towards saving power.

b. Timer installation for E1, E2, E3 office AC's.

c. Installation of VFDs in plant contributes energy saving.

d. Optimized operations of AHU & PAC units. e. Leakages arrested from ducting by installation of additional nut bolt & applying silicone. f. Timer installation for staircase lighting.

3. The capital investment on energy conservation equipment

a. Portable Chiller on 5 Buffering lines.

b. Portable compressor in Packing & Dispatch area.

c. New KAESAR 600 CFM Air compressors having_high power efficiency.

Shendra Draw Plant:

a. Capital investment on automation have less than half yearly payback period. It comprises 1 to 2% saving in monthly bill.

b. Cost investment on LED lights has less than two-year payback period.

Waluj and Gaurav Plant:

a. Cost investment on motion sensors & timers have less than a year payback period.

B. TECHNOLOGY ABSORPTION

1. The efforts made towards technology absorption Technology absorption in energy conservation Rakholi Plant:

a. Installation of AHF panel for harmonics reduction & power factor improvement

b. Upgraded UPS for energy saving mode to run on 20% higher efficiency.

c. Centralised utility energy bridge concept extended to new shop floor area.

Shendra Draw Plant:

a. New controller installation for old APFC panels for two LT Transformers for harmonics reduction & performance improvement but atomisation.

b. Replacement of batteries of Delta ups to improve availability/reliability of panel & power supply to phase 2 of plant

c. Switch yard Old revenue CT replacement as per new compliance of MSEDCL.

d. Grid power transformers Routine Testing & oil filtration activity. Increased the reliability of power supply

e. Carried out HT 33kV breaker and relay testing activity. Increased the reliability of power supply to the critical process of plant

f. Painting work of URT & LT Transformer due to corrosion, which increased its service life span

Waluj and Gaurav Plant:

a. Installation of new APFC panels for two LT Transformers for harmonics reduction & power factor improvement

b. Retrofitting of old APFC panels for two LT Transformers for harmonics reduction & performance improvement

c. Replacement of H2 plant, HT capacitor (6.6kV) with new rating capacitors which increased the availability/reliability of panel & power supply to H2 plant

d. Switch yard Old CT/PT/LA replacement work due to ageing

e. Grid power transformers Routine Testing, OLTC overhauling & oil filtration activity. Increased the reliability of power supply

f. Carried out HT (33kV)/LT(6.6kV) breaker and relay testing activity. Increased the reliability of power supply to the critical process of plant

g. Painting work of URT & LT Transformer due to corrosion, which increased its service life span

h. Installation of chokes to the chiller-9 VFD. The failure rate of VFD has reduced due to power harmonics and transient voltage spikes.

i. Ductable AC installation done in electrical building MCC room & scrubber PCC room.

j. Annunciation panel installation done in electrical building panels gives reliability

k. Tripping circuit provided for APFC during DG running reduces recovery time during power failure

l. Installation of timers provides reduced person activity physically

2. The benefits derived like product improvement, cost reduction, product development or import substitution Rakholi Plant:

a. Cost reduction by installation of portable equipment for individual lines to reduce load on main equipment like Chiller & Compressor.

b. UPS energy saving upgradation runs it on 20% higher efficiency

Shendra Draw Plant:

a. By installing load manager, the contract demand is fully optimized while maintain the required load factor without any risk of maximum demand shoot.

b. Replacement of focus lights with LED lights provides energy saving & also illumination.

Waluj and Gaurav Plant:

a. Optimized motor speed due to VFD installation reduces wear & tear effect of pumps. Increased life & efficiency of pumps

b. Replacement of focus lights with LED lights provides energy saving & also illumination.

c. Timers fixed in the electrical building staircase, Production building staircase to avoid unnecessary wastage of power during daytime

d. Replacement of focus lights with LED lights provides energy saving & also illumination.

e. Taking VRV Controller online (IP based) where we can control, Monitor, Schedule On/O_ of Acs from PCs It can help to minimize power consumption & increase the motor efficiency.

f. Temperature controller with an alarm system Installed in IT server room.

c. Rain Water Harvesting Implementation of Rain water harvesting in the plant with a harvesting potential with a provision to use water back into process.

d. Sewage Treatment Plant e. Environment and Sustainability

3. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year) – Not_Applicable

4. The expenditure incurred on Research and Development ( crores) 41 crores

a. Foreign Exchange Earnings and Outgo

Discussion on activities relating to development of exports is covered in the Management Discussion & Analysis Report. Foreign Exchange Actual Inflow: 3,516.37 crores Foreign Exchange Actual Outflow: 1,642.96 crores

b. Environment and Sustainability

Company's initiatives to minimize environmental footprint of products, manufacturing and supply chain are guided by its environmental policy. The Environment Management System of the company is ISO 14001 certified. The company has dedicated departments to manage different environmental aspects which are responsible for managing and monitoring the performance. The performance is evaluated periodically and future actions are planned.