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The Fertilisers and Chemicals Travancore Ltd.-இன் இயக்குநர் அறிக்கை

Mar 31, 2025

Your Directors take pleasure in presenting the 81^st Annual Report on the business and performance of the Company, together with the Audited Financial Statements (Standalone and Consolidated) and Auditors'' Report for the financial year ended, 31 ^stMarch, 2025.

Your Directors are pleased to share that, despite facing several challenges and constraints, the Company was able to sustain its operations at a reasonably steady level during the financial year 2024-25. One of the key challenges during the year was the limited availability and high cost of phosphoric acid, which severely impacted its supply and, in turn, adversely affected the production of Factamfos. Even amid various adverse economic and geopolitical conditions, the Company was able to generate a net profit.

Based on Market Capitalization, your Company is one among the top 200 listed Companies.

Performance Highlights;

â¢ Net profit of ''41.23 Cr.

â¢ Revenue from Operations of ''4050.91 Cr.

â¢ Total Fertilizer production 8.95 Lakh MT.

â¢ Sale of 11,63,090 MT Fertilisers.

â¢ Commissioned new 10,000 MT Ammonia Storage Tank at Cochin Division.

â¢ Company entered into a long term agreement with Societe Nouvelle des Phosphates du Togo (SNPT) for procurement of Rock Phosphate (Togo) for 3 years.

â¢ Annual Production of 2,50,578 MT Ammonium Sulphate is the all-time highest record production.

â¢ FACT & Oil India Limited signed a MoU to explore Green Hydrogen, Decarbonisation & clear energy initiatives, paving the way for a sustainable future.

â¢ First Fertilizer company in India to incorporate integration of IFMS (Integrated Fertilizer Management System) with SAP ERP System to capture real time movement of fertilizers.

â¢ Implementation of open access power purchase at Udyogamandal Complex.

â¢ FACT Udyogamandal Complex secured First Prize in Kerala State Energy Conservation Award 2024 under category of Large Scale Energy Consumers at the International Energy Festival of Kerala.

â¢ FACT Cochin Division received Second Prize in the National Safety Day - Safety Awards 2025 in the category Best Safety Committee.

â¢ Received the ''Shreshta Suraksha Puraskar Award'' for outstanding safety performance in the category of Very Large Chemical Factories.

â¢ Best Hindi Implementation & OL Magazine Awards from TOLIC (PSU), Kochi and honored with Rajabhasha shield for commendable work in the field of Official Language.

Standalone Financial Results Financial Results of the Company for the year ended March 31,2025 is summarized below: ('' i_{n crores})
Particulars	2024-25	2023-24
Net Sales	4050.91	5051.21
Other Income	216.45	203.12
Total Revenue	4267.36	5254.33
Total Expenses	4238.23	4966.89
Profit before Exceptional Items and Tax	29.13	287.44
Exceptional Items	24.61	-245.59
Earnings before Taxes	53.74	41.85
Interest	245.54	246.93
Depreciation	36.62	26.57
Deferred Tax	12.51	-86.42
Profit for the year	41.23	128.27
Other comprehensive Income	34.40	20.55
Total Comprehensive Income	75.63	148.82
â¢ Previous year figures have been regrouped/re-arranged wherever necessary.

Dividend Distribution Policy

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board of Directors of the Company has formulated and adopted the Dividend Distribution Policy. The policy is hosted on the website of the Company at the link https://fact.co.in/home/Dynamicpages?MenuId=914 Dividend

Your Directors had recommended a dividend of ''0.20/- (twenty paise) per equity share of face value of ''10/-each at the Board Meeting held on 26-05-2025 for the financial year 2024-25. The Board further revised the recommended dividend to '' 0.39/- (Thirty nine paise) per equity share of face value of ''10/- each at the Board Meeting held on 13.08.2025.

The Dividend on equity shares is subject to the approval of shareholders at the Annual General Meeting scheduled to be held on 26^thSeptember 2025.

Based on the number of equity shares, as on date of this report, the dividend, if approved would result in a cash outflow of ''25.24 Cr.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profit in the profit and loss account. No amount has been transferred to reserves for the financial year 2024-25.

The retained earnings balance as at 31.03.2025 amounted to ''56,870.20 lakh as compared to '' 58,354.43 lakh as at 31.03.2024.

Operations and Performance Production (i_{n M}t)
Production	2024-25	2023-24
Factamfos	6,44,768	8,27,717
Zinc Coated NP 20:20:0:13	1,555	-
Total NP 20:20:0:13	6,44,768	8,27,717
Ammonium Sulphate	2,50,578	2,42,577
Caprolactam	-	34,662

Marketing		(in MT)
Sale	2024-25	2023-24
Factamfos	717931	821012
Ammonium Sulphate	266683	222353
Caprolactum	996	34841

The company was able to maintain the momentum in production and marketing during the financial year 2024-25.

The Company''s operational performance during the financial year 2024-25 was adversely affected. In particular, the production of Factamfos was constrained due to the unavailability of phosphoric acid, compounded by a significant increase in its price.

The Company is actively working to expand the presence of its key products beyond its traditional stronghold in the Southern States. The Company is expanding its product portfolio by introducing Zincated Factamfos, Diammonium Phosphate (DAP), Triple Super Phosphate (TSP) and Single Super Phosphate (SSP), which will enhance FACT''s visibility in the market.

The efforts are being made to increase the sales volumes of, PM - PRANAM, products like Organic City Compost, Potash Derived from Molasses (PDM), Phosphate Rich Organic Manure (PROM), Fermented Organic Manure (FOM) etc.

In addition to establishing a presence in new markets such as Maharashtra, Bihar, West Bengal, Odisha, and Madhya Pradesh, FACT is also actively trying to expand in other key states including Chhattisgarh, Gujarat, and Uttar Pradesh.

Memorandum of Understanding with Government of India

Company has been entering into a Memorandum of Understanding (MoU) with the Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, setting the performance parameters and targets every year. Company has secured ''Good'' rating for the MoU for the year 2023-24. The evaluation of MoU performance for 2024-25 has not been finalized.

The MoU for 2025-26 has been signed.

Management Discussion and Analysis Report

Management Discussion and Analysis Report covering the operational aspects for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended) is presented in a separate section forming part of Board''s Report.

Roadmap for sustainability / Capital Projects

The Union Cabinet accorded approval in 2019-20 for CAPEX worth Rs. 608 crores to implement essential capital jobs with a view to enhance the reliability of production plants complying with changing statutory requirements and setting up of additional raw material storage tanks and plant. Critical renovation and modernizing schemes for debottlenecking raw material and product handling facilities also form part of CAPEX. The CAPEX projects of FACT are under various stages of implementation.

When the new NP project becomes operational, it demands additional storage facilities /intermediates which at present is planned to be met through imports. To address this, FACT is exploring new projects focused on expanding capacity and improving energy efficiency in key intermediate plants such as the Sulphuric Acid, Phosphoric Acid, and Ammonia plants. Plans also include enhancing the storage infrastructure for Sulphuric Acid and Ammonia at Willingdon Island. These initiatives are currently in the concept stage, and FACT intends to fund them through internal resources. Feasibility studies are being planned to evaluate the technical and financial viability of these proposals.

FACT has entered into long term agreements with suppliers including domestic suppliers for uninterrupted supply of key raw materials as below.

â¢ with SNPT Togo for the supply of Rock Phosphate for 3 years.

â¢ with BPCL & MRPL to meet its Sulphur requirement.

â¢ With IOCL for supply of RLNG for 5 years for uninterrupted operation of Ammonia Plant

With the commissioning of the new NP plant, the fertilizer production capacity of the company will increase by over 5 Lakh MT per annum. Company also has plans to improve the product mix through trading of different NPK products, with a view to improve the top and bottom line.

Details of major projects, which have been completed as on financial year 2024-25 and the projects which are in progress are summarized below;

^ 10000 MT Ammonia Storage tank at Cochin Division: LSTK project completed and Tank commissioned in August 2024.

^ Construction of two Phosphoric Acid Storage Tanks at Q10 Berth, Willingdon Island: The work related to rubber lining and associated activities are being taken up. Hydro testing has been completed. ^ New 1650 MTPD NPK Plant at Cochin Division, Ambalamedu: Project is progressing at Cochin Division in LSTK mode. Construction of the main plant building and other civil works are progressing. Many major equipment has reached the site. Construction of intermediate storage tanks are progressing.

Industrial Relations

During the financial year 2024-2025, cordial industrial relations were maintained across all Divisions of the Company.

Discussions were regularly held between the Management and Trade Unions and Officer Associations on various matters. There was no loss of productivity due to IR issues.

Corporate Governance

Our Company remains compliant with corporate governance norms by adhering to integrity, transparency, and accountability, supported by well-defined policies and ethical practices that ensure long-term value creation and the protection of shareholder rights. The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI and the guidelines on Corporate Governance issued by the Department of Public Enterprises, Government of India. The Report on Corporate Governance for FY 2024-25 as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annexed to this report, forms an integral part of this report.

Further, pursuant to Schedule V (E) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a Compliance Certificate from the Practicing Company Secretary regarding compliance of conditions of corporate governance is attached as Annexure-3.

Business Responsibility and Sustainability Report

This would enable the Members to have an insight into Environmental, Social and Governance initiatives of the Company.Accordingly, your directors are glad to present the BRSR report of FACT for the financial year 2024-25 and it is part of the Annual Report of the Company.

Further SEBI vide its circular no. SEBI/HO/CFD/CFD-SEC-2/P/CIR/2023/122 dated July 12, 2023, updated the format of BRSR to incorporate BRSR core, a subset of BRSR indicating specific Key Performance Indicators (KPIs) under nine principles of business responsibility which are subject to mandatory reasonable assurance by an independent assurance provider. In line with these requirements, the Company has obtained reasonable assurance on the BRSR Core Indicators from TUV SUD South Asia Pvt. Ltd., on a standalone basis.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2025, prepared in accordance with Section 129(3) of the Companies Act 2013 and relevant accounting standards form part of the Annual Report.

The Consolidated Financial Statements have been prepared under equity method along with Company''s Standalone Financial Statements. For preparing the Consolidated Financial Statements, the unaudited financial statements of FRBL for the year 2024-25 has been considered, since the statutory audit of FRBL for the year 2024-25 is not completed.

Material changes and commitment

The Committee for Monitoring Capital Management and Dividend in CPSEs (CMCDC), in its meeting held on July 03, 2025, recommended that the Company pay a dividend of ''25 crores for the financial year 2024-25. Based on this direction, the Board revised its earlier recommended dividend of ''0.20 per equity share to ''0.39 per share.

There was no change in the nature of business of the Company during the financial year 2024-25.

Associate / JV Company

FACT-RCF Building Products Limited (FRBL) is a joint venture (JV) Company of FACT. CIRP has been initiated in respect of FRBL on 11.01.2024. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the associate company / joint ventures in Form AOC-1 is provided as part of the Annual Report.

Report on financial position and Performance of Joint Venture

During the financial year 2024-25, the unaudited financial results of FRBL shows a net loss of ''163.76 Lakhs. Due to the accumulated loss, the entire networth of FRBL has been eroded. FACT has created provisions for the entire investment made in FRBL.

ISO Certification

All fertilizer plants in Udyogamandal Complex and Cochin Division are certified for ISO 14001:2015 and ISO 9001:2015. FACT Cochin Division is certified for ISO 45001:2018. FACT Udyogamandal Division is certified for ISO 50001:2018.

Pollution Control Activities

FACT places the highest priority on maintaining clean air and a healthy living environment for the residents in and around its factory premises.

The effluent treatment plant and emission control facilities are kept in operation along with the production plant throughout the year. Treated liquid effluents and gas emissions discharged from plants conforms to the standards prescribed by the Central Pollution Control Board and the Kerala State Pollution Control Board. As per directions from Central Pollution Control Board (CPCB) & Kerala State Pollution Control Board (KSPCB), continuous online monitoring and web uploading are in progress. All analyzers as per guidelines have been installed and the parameters are uploaded in KSPCB & CPCB websites.

The Company successfully maintained all effluent discharge parameters within the limits prescribed by the statutory authorities. In line with its commitment to responsible waste management, FACT, under an agreement with Kerala Enviro Infrastructure Limited (KEIL), ensured the safe disposal of accumulated hazardous waste. This included spent V₂O₅ catalysts, ETP sludge, sulphur muck, and e-waste, all of which were handed over to KEIL for final disposal in an environmentally compliant manner.

Scheme for solid waste management is being implemented by providing separate Bin for metal scraps, bio degradable and non-bio degradable wastes. Solid waste is collected and further segregated at designated facility.

As per directions from Central Pollution Control Board (CPCB) & Kerala State Pollution Control Board (KSPCB) requirement, emission and effluent data in respect of the following are being uploaded to the website of KSPCB & CPCB.

â¢ SO2 emission from Sulphuric Acid plant stack.

â¢ Ammonia, Fluoride and particulate matter emission from complex fertilizer plant stack.

â¢ Fluoride and particulate matter emission from Phosphoric Acid plant stack.

â¢ pH, Fluoride, Ammoniacal Nitrogen and flow of effluent outlet.

Fire and Safety Measures and Training Activities

The Fire and Safety Department, managed by company personnel, operated smoothly during the year. In 2024-25, FACT Udyogamandal Division recorded 3.2 million accident-free man-hours, with a total of 19.7 million accident-free man-hours since the last reportable accident.

A total of 7,863 man-hours were dedicated to safety training during the year. The Safety Committee functioned effectively, contributing to the maintenance of safe working conditions across the plant.

As part of the On-Site Emergency Plan, emergency preparedness was evaluated through the conduct of both onsite and local mock drills, simulating scenarios such as toxic gas leaks and fire outbreaks.

Official Language

FACT is giving utmost priority to the promotion and implementation of the Official Language Policy of the Government of India. Quarterly meetings of the Official Language Implementation Committee are regularly held in FACT under the chairmanship of Chairman & Managing Director to review the position regarding implementation of the Official Language Act / Rules and the orders issued by the Government of India regarding the use of Hindi in official work and of the Annual Programme prepared in that regard. In order to create enthusiasm in the Official Language among the employees, Hindi Department regularly organizes several programmes and competitions for the employees and officers of various Divisions of the company. Prizes were given to all the participants. This year also Hindi Fortnight celebrations were held at the corporate level with various competitions and prizes were given to the winners.

Hindi Department is organizing Hindi workshops and training programmes for our employees on a quarterly basis to give information about Official Language Rules and other provisions arranged by Government of

India. 14 workshops were organized during the year to promote the Official Language Hindi, in which 247 Officers and employees actively participated.

In order to do more official work in Hindi, the Company gives cash awards to the employees. This year, under the cash award, 54 employees were honoured with cash prizes for doing their official work in Hindi. Every year FACT gets awards for Hindi competitions organized in connection with the Joint Hindi Fortnight Celebration under the Kochi Town Official Language Implementation Committee (Undertaking). On this occasion, we get awards for Best Hindi Implementation and also for OL Home Magazine.This year they have honoured by giving Rajbhasha Shield for commendable work in the field of Official Language implementation and Second prize for the Official Language in House - Magazine Rashtravani.

Public procurement policy of Micro and Small Enterprises (MSEs) Order 2012

Company gives priority to Micro and Small Enterprises for procurement as per directives issued by the

Government of India from time to time.

During the year, the Company procured material & services worth ''209 Cr (60.37% of total procurement other than feed stocks & fertilizers) from MSEs. Out of which ''2.1 Cr (0.61%of total procurement) is from MSEs owned by SC/ST entrepreneurs and ''15.82 Crore (4.57% of total procurement) is from women entrepreneurs. Most of the feed stocks and Fertilizer inputs procured by FACT are not available with the MSEs.

FACT participated in a vendor development programme organized by MSME Development and Facilitation Office, Thrissur.

FACT is registered with TReDs platform of Receivable Exchange of India Limited (RXIL) a joint venture by SIDBI and NSE for providing bill discounting facilities to MSMEs.

In line with the OM No. M-03/0003/2020-DPE (MOU) dated 22nd July 2024 issued by the Department of Public Enterprises, MOU Division, Ministry of Finance, and Government of India, Company on boarded on the TReDS platform of Invoice Mart and M1xchange.

Directors and Key Managerial Personnel

Appointments

Based on notification from Government of India, Ministry of Chemicals & Fertilizers four directors were appointed by the Board of Directors of FACT during the year 2024-25.

1. Dr. Tina Soni (DIN:07720240) as a Government Nominee Director vide Order No. 95/1/2019-HR PSU (pt.2) (e-31042) dated 18^th February, 2025.

2. Dr. Aruna Kamineni (DIN: 09591742) as Non-Official Independent Director vide Order No. 95/01/2025-HR-PSU (e-38759) dated 16^th May, 2025.

3. Shri. Billeswar Sinha (DIN: 09393543) as Non-Official Independent Director vide Order No. 95/01/2025-HR-PSU (e-38792) dated 16^th May, 2025.

4. Shri. Santosh Kumar (DIN:11228100) as a Government Nominee Director vide Order No. 95/1/2019-HR PSU (pt-2) (e-31042) dated 17^th July, 2025.

Re-appointment

Director liable to retire by rotation

In terms of the provisions of the Companies Act, 2013, Shri. Manoj Sethi (DIN: 00301439), Director of the Company, retires at the ensuing AGM and being eligible, seeks re-appointment.

The necessary resolution for re-appointment of Shri. Manoj Sethi forms part of the Notice convening the ensuing AGM. The profile and particulars of experience, attributes and skills that qualify Shri. Manoj Sethi for Board membership is disclosed in the said Notice.

Retirements & Resignations

Shri. Keda Tanaji Aher (DIN:07126654), Independent Director, resigned from the Board of the Company with effect from 29^th October, 2024.

In accordance with the order from the Government of India, Ms. Aparna Sharma (DIN:07798544) ceased to be the Government Nominee Director on the Board of the Company effective 19^th February, 2025.

As per the terms of appointment, Dr. Anjula Murmu (DIN:09565841), completed her term as an Independent Director on 27^th May, 2025 and accordingly, ceased to be an Independent Director and Member of the Board of Directors of the Company.

Dr. Tina Soni (DIN: 07720240), Government Nominee Director on the Board of FACT, ceased to be a Director of the Company with effect from 12^thMay, 2025, upon completion of her tenure.

The Board places on record its sincere appreciation for the valuable contribution by the aforesaid Directors, during their tenure as Directors of the Company.

Reappointment of Independent Directors

During the financial year 2024-25, no Independent Director was reappointed on the Board of the Company as per section 149 (10) of the Companies Act 2013.

Disqualification of Directors

None of the Directors has incurred any disqualification as provided under section 164 of the Companies Act 2013.

Key Managerial Personnel

In terms of Section 203 of the Act, the Key Managerial Personnel of your company are:

Sl. No.	Name	DIN	Designation
1	Shri. S. C. Mudgerikar	03498837	Chairman and Managing Director
2	Shri. Anupam Misra	07637439	Director (Marketing)
3	Shri. S. Sakthimani	07482308	Chief Financial Officer & Director (Finance)
4	Dr. Jayachandran K.	10062573	Director (Technical)
5	Ms. Susan Abraham	N.A	Company Secretary

Annual Evaluation of Board

FACT being a Government Company, all appointments on the Board is made by the Government of India, Ministry of Chemicals and Fertilizers, Department of Fertilizers. The performance of Directors is evaluated by the Ministry of Chemicals & Fertilizers, Department of Fertilizers, Government of India. As per Government of India, Ministry of Corporate Affairs notification dated 05^th June 2015, clause (e) and (p) of sub-section 3 of Section 134 of the Companies Act 2013 relating to appointment, remuneration and annual evaluation of the performance of the Board is not applicable to FACT.

In accordance with SEBI (LODR) Regulations, the Nomination & Remuneration Committee, at its meeting held on 04.02.2025, approved the criteria for evaluating the performance of Independent Directors by the Board. Subsequently, the Board, in its meeting held on 14.02.2025, reviewed the performance of the Company''s Independent Directors based on the approved criteria.

The Independent Directors in their meeting held on 25.03.2025, reviewed the performance of NonIndependent Directors, the overall functioning of the Board, the Chairperson''s performance, and the effectiveness of information flow between management and the Board, as per Regulation 25(4) of SEBI (LODR) Regulations.

Independent Directors'' Declaration

The Company has received necessary declaration from the Independent Directors confirming that they meet the criteria of independence as prescribed under Companies Act, 2013 and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and they have registered their names in the Independent Directors'' Databank maintained by the Indian Institute of Corporate Affairs.

The Independent Directors are in compliance with the Code of Conduct prescribed under Schedule IV of the Companies Act, 2013 and the Code of Business Conduct adopted by the Company.

In the opinion of the Board, all Independent Directors possess requisite qualifications, experience, expertise and hold high standards of integrity required to discharge their duties with an objective independent judgment and without any external influence.

Meetings of the Board

During the financial year 2024-25, five (5) meetings of the Board were convened and held. Details of composition of the Board and its Committees as well as details of Board and Committee meetings held during the year under review and Directors attending the same are given in the Corporate Governance Report forming part of the Annual Report for FY 2024-25.The gap between two Board Meetings was within the maximum time gap prescribed under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015. The requisite quorum was present in all the Meetings.

Secretarial Standards

Your Directors state that during the year under review, the Company has complied with the provisions of Secretarial Standard 1 (relating to meetings of the Board of Directors) and Secretarial Standard 2 (relating to General meetings) issued by the Institute of the Company Secretaries of India.

AUDITORS

(1) Statutory Auditors and Statutory Auditor''s Report

M/s. G.Venugopal Kamath & Co., Chartered Accountants, Kochi, was appointed as Statutory Auditors of the Company for the financial year 2024-25 by the Comptroller and Auditor General of India.

M/s. Shanker Giri & Prabhakar, Chartered Accountants, Chennai, was appointed as Branch Auditors for the year 2024-25, for the Area / Regional Offices at Tamil Nadu and Kerala, by the Comptroller and Auditor General of India.

M/s. RB Kabra & Co, Chartered Accountants, Hyderabad, was appointed as Branch Auditors for the year 2024-25 for the Area / Regional Offices at Andhra Pradesh, Telangana and Karnataka by the Comptroller and Auditor General of India.

The report of the Statutory Auditor forms part of this Annual Report.Statutory Auditors has not made any qualification or adverse remarks on the Financial Statements for the financial year 2024-25.

(2) Cost Audit

As prescribed under section 148 of the Companies Act ,2013, read with the Companies (Cost Report and Audit) Rules 2014, cost accounting records are being maintained by the Company. M/s. BBS & Associates, Cost Accountants, Kochi has been appointed as Cost Auditors of the Company for the year 2024-25. Cost Audit report for the financial year 2023-24 was filed with Ministry of Corporate Affairs on 01 ^stOctober 2024.

(3) Secretarial Auditors and Secretarial Auditor''s Report

M/s. CaesarPintoJohn & Associates, Company Secretaries, Kochi, has been appointed as Secretarial Auditors of the Company for the year 2024-25. The report of the Secretarial Auditor is annexed to this report as Annexure-4. The Secretarial Auditor has made the following observations in their Secretarial Audit Report.

As per Regulation 17(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, where a listed entity does not have a regular Non-Executive Chairperson, at least half of the board of directors shall comprise of independent directors. During the financial year from

01.04.2024 to 31.03.2025 the composition of the Board did not meet this requirement. Further, from

28.03.2025 to 31.03.2025, the Audit Committee was not constituted with the mandated two-thirds majority of Independent Directors, the Nomination and Remuneration Committee does not have the required two-thirds majority of Independent Directors, the Stakeholders Relationship Committee did not include the required minimum of one Independent Director, and the Risk Management Committee did not include the required minimum of one Independent Director.

Pursuant to proviso to Regulation 17 (1) (a) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of directors of the top 1000 listed entities shall have at least one independent woman director. The Company does not have an independent woman director with effect from 28.03.2025.

Pursuant to Regulation 17(1E) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, any vacancy in the office of a director shall be filled by the listed entity at the earliest and in any case not later than three months from the date of such vacancy. Provided further that if the listed entity becomes non-compliant with the requirement under sub-regulation (1) of this regulation, sub-regulation (1) of regulation 18, sub-regulation (1) or (2) of regulation 19, sub-regulation (2) or (2A) of regulation 20 or subregulation (2) or (3) of regulation 21, due to expiration of the term of office of any director, the resulting vacancy shall be filled by the listed entity not later than the date such office is vacated. Vacancies in the office of independent directors are not filled within 3 months of such vacancy. Further vacancy due to expiration of the term of office of Ms. Anjula Murmu (Independent Director) is not filled by the listed entity not later than the date such office is vacated.

Pursuant to Regulation 31 (5) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, the declaration required under sub-regulation (4) shall be made within seven working days from the end of each financial year to every stock exchange where the shares of the target company are listed; and the audit committee of the target company.

Declaration required under regulation 31(4) from the promoters for the financial year ended 31.03.2024 is not seen submitted to the stock exchange within 7 working days from the end of the financial year.

Explanation on observations made by Secretarial Auditors in their report is given below;

The Company is a Central Public Sector undertaking under the administrative control of the Department of Fertilisers, Ministry of Chemicals and Fertilisers, Government of India. The power to appoint Directors on the Board of the Company vests with the Government of India. The Company reconstituted the committees by inducting the only available Independent Director, designated as Chairperson of all the above Committees on 01.04.2025. No meetings were held during the intervening period. Based on notification from the Govt. of India two new Independent Directors were appointed to the board on

05.05.2025 and the committees were reconstituted by including the newly appointed Independent Directors. The Company now has three Independent Directors on its Board, including one woman Independent Director.

The Company received the Declaration under Regulation 31(4) from the Ministry of Chemicals and Fertilisers on 09.04.2024 and filed it on the same day.

Audit Committee

In line with the provisions of Section 177 of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company has constituted an Audit Committee. Details of Members/ Meetings of the Audit Committee are elaborated in the report on Corporate Governance annexed herewith.There were no instances in which the Board has not accepted any recommendation of the Audit Committee.

Policy on remuneration of Directors, Key Managerial Personnel and other Employees.

FACT, being a Central Public Sector Enterprise under the Ministry of Fertilisers and Chemicals, the appointment, tenure and remuneration of Directors are decided by the Government of India.

In accordance with the provisions of Section 178 of the Companies Act, 2013, the Board of Directors of FACT has constituted the Nomination and Remuneration Committee. The Committee has framed a policy on Remuneration of Directors, Key Managerial Personnel and other Employees pursuant to Section 178(3) of the Companies Act and Part D of Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy is available on the website of the Company at https://fact.co.in/home/ Dynamicpages?MenuId=3018 Investor Education and Protection Fund (IEPF)

During the year, no amount was required to be transferred to the Investor Education and Protection Fund (IEPF). Accordingly, FACT has not made any transfers during the year, and there are no pending amounts due for transfer to the IEPF.

Contract or arrangement with related parties

The transactions entered into with related parties for the year under review were on arm''s length basis and in the ordinary course of business. The disclosure in Form No AOC-2 for the transactions with related parties during the period under review is enclosed as Annexure -2.

Corporate Social Responsibility

FACT continued to give priority on various Social Responsibility measures. The Company has a Board Level Committee constituted as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014. The CSR Policy of the Company is available on the website of the Company at https://fact.co.in/home/ Dynamicpages?MenuId=2963 .

The Company spent ?125.12 lakh for CSR Projects and ?543.35 lakh has been set off against excess spent in previous years to meet the CSR obligation for the year.

Annual Report on CSR as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed to this report as Annexure-5.

FACT Initiative for the farming community

The Company successfully implemented various schemes, reflecting a strong engagement with farming communities and other partners. The key initiatives include

â¢ Pradhan Mantri Kisan Samridhi Kendra - PMKSK - Pradhan Mantri Kisan Samridhi Kendra is an initiative of the Department of Fertilizers launched during August 2022. It aims to convert the existing village, block/sub district/ taluk and district level fertilizer retail shops into Model Fertilizer Retail Shops that will act as "One Stop Shop" for all the agriculture related inputs and services. A total of 3602 PMKSKs have been completed by FACT across various states till 2024-25

â¢ Namo Drone Didi (NDD)Hubs - 50 FACT NDD Hubs were developed in the year 24-25 with the required facilities as per the directions of Department of Fertilizers.

â¢ PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth (PM PRANAM)- Under the GOI PM PRANAM initiative, several Kisan Sangothi (farmer Meetings) were organized at different locations by FACT Marketing Division. These programs focused on raising awareness about sustainable agricultural practices, soil health restoration and environmental nourishment with the goal of fostering a more sustainable and eco-friendly approach to farming. FACT''s PM PRANAM offerings namely FACT Organic, FACT Organic Plus, FACT FOM, FACT PDM and FACT PROM were showcased through these gatherings and farmers were educated about the benefits of these products. Officials from the Agriculture Department, along with scientists from the Indian Council of Agricultural Research (ICAR), Krishi Vigyan Kendras (KVKs), research stations, and

agricultural universities, participated in the events and shared insights on the latest technologies and initiatives in the agriculture sector.

â¢ Community Radio Service: A total of 44 episodes were broadcast through various community radio stations across Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, and Telangana. These episodes featured FACT officials discussing a broad range of informative topics aimed at supporting farmers. The broadcasts served as a valuable platform for disseminating guidance on improved agricultural practices and addressing key challenges faced by the farming community.

Risk Management

FACT has a well-defined Risk Management Policy in place to identify potential risk areas and implement appropriate mitigation measures. The Company has also established adequate risk management infrastructure that is equipped to effectively address and manage all foreseeable risks.The Risk Management Policy of the Company is available on the website of the Company at https://fact.co.in/home/Dvnamicpages?MenuId=2979 Vigil Mechanism & Whistle Blower Policy

FACT has a Vigil Mechanism in place that allows Directors and Employees to raise concerns in a secure and confidential manner. In appropriate cases, they can report their concerns directly to the Chairman of the Audit Committee. The Vigil Mechanism and Whistle Blower Policy are available on the Company''s website at www.fact.co.in, and can be accessed directly via the link: https://fact.co.in/home/Dynamicpages? MenuId=45

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

In compliance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company affirms the following:

The Company has duly constituted an Internal Complaints Committee as required under the Act, to redress complaints related to sexual harassment at the workplace. The company maintains a zero-tolerance policy towards sexual harassment and has implemented measures to raise awareness, prevent misconduct and to ensure a safe working environment for all employees.

The details of complaints during the financial year are as follows:

i. Number of complaints of sexual harassment received in the year: 1

ii. Number of complaints disposed of during the year: 1

iii. Number of cases pending for more than ninety days: 0

Maternity Benefit Act

FACT has complied with the applicable provisions of the Maternity Benefit Act, 1961. It has ensured that all eligible female employees are extended the benefits mandated under the Act, including paid maternity leave, nursing breaks and protection from dismissal during maternity leave.

The company remains committed to providing a safe, supportive and inclusive working environment and continues to implement policies that supports health and well-being of women employees especially during maternity and post maternity period.

Code of Conduct

FACT has a code of conduct known as FACT Code of Business Conduct and Ethics applicable to the members on the Board and all senior executives of the Company. The code has been posted on the Company''s website www.fact.co.in and can be downloaded using the link https://fact.co.in/home/ Dynamicpages?MenuId=2959

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and Senior Executives of the Company. It also includes the duties of Independent Directors as laid down in the Companies Act, 2013.

The Board members and Senior Executives of the Company have affirmed compliance of the code of Conduct for the financial year 2024-25.

Prevention of Insider Trading

There have been no reported instances of insider trading involving FACT shares till date. A Code of Conduct on the Prohibition of Insider Trading is available on the Company''s website and can be accessed via the following link: https://fact.co.in/home/Dynamicpages?MenuId=849 Particulars of Loan given, Investment made, Guarantees given and Securities provided Particulars of Investment made by the Company are provided in the financial statement for the year 202425. During the financial year 2024-25, FACT has not provided any loan/guarantee or made any investment within the purview of Section 186 of the Companies Act 2013.

Internal Controls & their adequacy

The Internal Control systems are reviewed by the Audit Committee. The Company being a Government owned company is subject to Audit by C&AG. The adequacy of Internal Control procedures is also reviewed by the Statutory Auditors in their Audit Report.

The Company''s internal control systems are commensurate with the nature of its business, size, and complexity of its operations. Internal financial controls with reference to the Financial Statements are adequate. Details on the Internal Financial Controls of the Company forms part of Management Discussion and Analysis forming part of this Report.

Particulars of Employees and related disclosures

During the year under review, none of the employees of the Company had drawn remuneration in excess of the limit prescribed under section 134 (3)(c) of the Companies Act, 2013 read with Companies (Appointment of Managerial Personnel) Rules 2014.

As per the notification dated 05^th June, 2015 issued by the Ministry of Corporate Affairs, Government of India, section 197 of the Companies Act, 2013 is not applicable to a Government Company.

Vigilance

Vigilance is an integral part of the managerial function of an organization and the vigilance department plays a crucial role in ensuring transparency, integrity and accountability within the organization. The primary objective of the FACT vigilance department is to prevent corruption, misconduct, fraud, and abuse of power thereby upholding the public trust and promoting good governance.

The work profile of the vigilance department comprises mainly of handling complaints received by CVO from different sources and investigation of verifiable complaints having a vigilance angle. As part of preventive vigilance measures vigilance department also undertakes surprise inspections, surveillance and intelligence-gathering activities on a regular basis. Scrutiny of procurement/contract files, reviewing property returns of employees, monitoring the rotation of staff in sensitive areas, and coordination with CVC and other government departments also form the part of work profile of the vigilance department.

During the financial year 2024-2025, as per the directives of the Central Vigilance Commission (CVC), the week from October 28th to 3rd November 2024 was observed as Vigilance Awareness Week in FACT with the theme "Culture of Integrity for Nation''s Prosperityâ.

As part of systemic improvements, an Employee Complaint Portal and Marketing App have been launched.

Integrity Pact

An Integrity Pact in line with Government of India guidelines in this regard has been finalised and implemented in the Company.

The Right to Information Act 2005

FACT is complying the provisions of the Right to Information Act 2005 and the details relating to Public Information Officer, Assistant Public Information officer, Appellate Authority, Nodal officer etc. are published on the website of the Company www.fact.co.in and can be downloaded using the link https://fact.co.in/home/Dynamicpages?MenuId=472 Annual Return

The Annual Return of the Company as provided under Sub section (3) of Section 92 of Companies Act, 2013,is published on the website of the Company, at the link https://fact.co.in/home/ Dynamicpages?MenuId=3028

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

Information regarding the conservation of energy, technology absorption, and foreign exchange earnings and outgo as required to be disclosed in terms of the Companies (Accounts) rules 2014 is set out in a separate statement as Annexure-1.

Director''s Responsibility Statement

Pursuant to Section 134(3) (c) of the Companies Act, 2013, your Directors hereby state that:

(a) in the preparation of annual accounts for the year ended March 31,2025, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2025 and of profit and loss statement for the year ended March 31,2025.

(c) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(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.

General

The Board of 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.

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the company under any scheme.

4. The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

5. Neither the Managing Director nor the whole time Directors of the Company receive any remuneration or commission from its Associate Company.

6. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

7. No fraud has been reported by the Auditors to the Audit Committee or to the Board.

8. There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

9. The Company has not made any one-time settlement for the loans taken from the Banks or Financial Institutions.

Acknowledgement

Your Directors gratefully acknowledge the valuable guidance and support extended by Hon''ble Minister of Chemicals and Fertilisers, Hon''ble Minister of State for Chemicals and Fertilisers, Hon''ble Chief Minister, Government of Kerala, the Secretary, Ministry of Chemicals and Fertilisers and other officials of the Ministry of Chemicals and Fertilisers as well as other Ministries of the Government of India, Department of Public Enterprises and other State Governments.

The Directors deeply appreciate the committed efforts put in by the employees and look forward to their dedicated services and endeavor in the years ahead to enable the Company to scale greater heights.

The Directors also acknowledge the continued support extended by the Shareholders, Dealers, Suppliers, Bankers, Valued Customers and Auditors of the Company.

Mar 31, 2024

Your Directors have pleasure in presenting the 80^th Annual Report on the performance of the Company, together with the Audited Standalone and Consolidated Financial Statements for the financial year ended 31^stMarch, 2024.

Your Directors are happy to inform you that during the financial year 2023-24, the Company has maintained the production, and sales at almost the same level as the previous year.

The Financial year 2023-24 was a challenging year for the fertilizer industry as a whole, with volatility in the international market and unfavorable climatic conditions. The revised Nutrient Based Subsidy (NBS) rates, considering the time gap, were not commensurate with the cost of raw materials. Prices of the products also came down, affecting the realization of the products. Recoveries towards NBS revisions, unreasonable profit and naphtha compensation of prior years had to be accounted for during 2023-24. In spite of these challenges FACT managed to book a profit of ''146.17 Cr.on a turnover '' 5054.93 Cr.

Based on Market Capitalization, as on March 31, 2024, your Company is one among the top 500 listed Companies.

Performance Highlights;

â¢ Net profit of ''146.17 Cr.

â¢ Turnover '' 5054.93 Cr.

â¢ Total Fertilizer production 10.70 Lakh MT.

â¢ Caprolactam Production 34,662 MT.

â¢ Sale of 1175574 MT Fertilisers.

â¢ Sale of 34,841 MT Caprolactam.

â¢ New Sulphuric Acid storage tank at Cochin Division and the reconstruction of the South Coal Berth at Willingdon Island commissioned successfully.

â¢ Ranked 179^thamong the listed companies in terms of Market Capitalization as on 31.03.2024.

â¢ Received the MKK Nayar Productivity Award 2023 for the Best Productivity Performance in the category of Very Large Industries.

â¢ Best Hindi Implementation & OL Magazine Awards from TOLIC (PSU), Kochi.

1. Financial Results (Standalone)

Financial Results of the Company for the year ended March 31,2024 is summarized below:

Particulars	2023-24	2022-23
Net Sales	5054.93	6198.15
Other Income	203.12	135.57
Total Revenue	5258.05	6333.72
Total Expenses	4968.96	5720.73
Profit before Exceptional Items and Tax	289.09	612.99
Exceptional Items	-245.59	0
Earnings before interest, depreciation and Taxes (EBIDTA)	562.59	890.48
Interest	246.93	247.54
Depreciation	26.57	30.11
Deferred Tax	-102.67	0
Profit for the year	146.17	612.83
Other comprehensive Income	20.54	-1.11
Total Comprehensive Income	166.72	611.72

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board of Directors of the Company (the Board) has formulated and adopted the Dividend Distribution Policy. The policy is hosted on the website of the Company at the link https://fact.co.in/home/Dynamicpages?MenuId=914 Dividend

For the Financial Year 2023-24, the Board has recommended a Dividend of '' 0.97/- (ninety-seven paise) per equity share of face value of Rs.10/- each. The Board has recommended dividend based on the parameters laid down in the Dividend Distribution Policy. The dividend will be paid out of the profits for the year 2023-24. The Dividend on equity shares is subject to the approval of shareholders at the Annual General Meeting scheduled to be held on 27th September 2024.

Based on the number of equity shares, as on date of this report, the dividend, if approved would result in a cash outflow of '' 62.76 Cr.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profit in the profit and loss account. No amount has been transferred to reserves for the financial year 2023-24.

Operations and Performance Production

Production	2023-24 (in MT)	2022-23 (in MT)
Factamfos	827717	828195
Ammonium Sulphate	242577	244732
Caprolactam	34662	44754

Excellent production with more than 100% capacity utilisation could be achieved and FACT once again produced more than one million tonnes of fertilisers.

Marketing

Sale	2023-24 (In Lakh MT)	2022-23 (In Lakh MT)
Factamfos	8.21	7.43
Ammonium Sulphate	2.22	2.20
Caprolactam	0.35	0.44

The Company has also started selling the new products like PDM / PROM / Nano UREA / Nano DAP. The company also appointed stock point dealers in Karnataka, Andhra Pradesh and Telangana for the first time which will improve Godown facility / wide spread availability of stocks for the dealers / farmers.

The company recorded total sales of all products at 11.76 lakhs MT for the year 2023-24, marking an 18% growth compared to previous year''s sales of 9.96 lakh MT in spite of adverse climatic conditions and stiff competition.

Memorandum of Understanding with Government of India

Your Company has been entering into a Memorandum of Understanding (MoU) with the Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, setting the performance parameters and targets every year. Company has secured ''Good'' rating for the MoU for the year 2022-23. The evaluation of MoU performance for 2023-24 has not been finalized.

The MoU for 2024-25 is under finalization by the Govt. of India.

Management Discussion and Analysis Report covering the operational aspects for the year under review, as stipulated under SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended) is presented in a separate section forming part of Directors'' Report.

Roadmap for sustainability / Capital Projects

The Union Cabinet accorded approval in 2019-20 for CAPEX worth Rs. 608 crore to implement essential capital jobs for enhancing the reliability of production plants, complying with changing statutory requirements and setting up of additional raw material storage tanks and plant. Critical renovation and modernizing schemes for debottlenecking raw material and product handling facilities also form part of CAPEX.

The CAPEX projects of Ammonia barge, sulphuric acid tanks and South coal berth reconstruction and Q9-Q10 connectivity have been completed. Other schemes are under various stages of implementation. With the commissioning of the new NP plant, the fertilizer production capacity of the company will increase by over 5 Lakh MT per annum.

FACT is in the process of commissioning / implementing various CAPEX projects to enhance the production capacity and the sustainable growth of the Company in the long run.

Details of major projects, completed at the end of 2023-24 and the status of projects which are in progress are summarized below;

â¢ The new ammonia barge, Pearl of Periyar, for transporting Ammonia between production divisions and Cochin Port through inland waterways was commissioned in November 2022.

â¢ The reconstruction of South Coal Berth at Cochin Port for import of Ammonia under Sagar Mala scheme was completed in March 2023.

â¢ Two additional Sulphuric Acid storage tanks (5000 MT capacity) at Cochin Division were commissioned in April 2023.

â¢ New pipe lines for unloading Sulphuric Acid and Phosphoric Acid from Q9 Berth of Cochin Port was commissioned in January 2024.

â¢ The civil works for the 1650 MTPD NP plant at CD is progressing. The equipments started arriving at site.

â¢ Construction of 10000 MT Ammonia storage tank at Cochin Division completed and precommissioning activities are progressing.

â¢ Construction of two Phosphoric Acid storage tanks (5900 MT each) at Willingdon Island -Civil and Mechanical works are progressing.

Sustainable Development

Your Company is giving priority on implementing several sustainable development activities. The Petro plants which was being operated on Captive Power supply, was switched to Grid supply from 03.02.2023 onwards. This has led to savings in RLNG consumption for captive power generation.

Industrial Relations

During the financial year 2023-2024, cordial industrial relations were maintained across all Divisions of the Company.

The managerial personnel were paid Performance Related Pay in December 2023. Enhancement of age of retirement of below Board level employees from 58 to 60 years was implemented as approved by Department of Fertilizers, Government of India.

Corporate Governance

The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI and the guidelines on Corporate Governance issued by the Department of Public Enterprises, Government of India. The Board lays emphasis on transparency and accountability for the benefit of all stakeholders of the Company. The Report on Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annexed to this report, forms an integral part of this report.

Business Responsibility and Sustainability Report

In accordance with Regulations 34(2)(f) of the SEBI Listing Regulations, the Securities and Exchange Board of India (SEBI), in May 2021 introduced new sustainability related reporting requirements to be reported in the specific format of Business Responsibility and Sustainability Report (BRSR). BRSR is a significant step towards giving platform to the Companies to report the initiative taken by them in the areas of environment, social and governance. SEBI has mandated top 1000 Listed Companies, based on market capitalisation to publish BRSR from financial year 2022-23 onwards. Accordingly, your directors are glad to present the BRSR report of FACT for the financial year 2023-24 and it is part of the Annual Report of the Company. Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2024, prepared in accordance with Section 129(3) of the Companies Act 2013 and relevant accounting standards form part of the Annual Report.

The Consolidated Financial Statements have been prepared under equity method along with Company''s Standalone Financial Statements.

Material changes and commitment

There were no material changes and commitments affecting the financial position of the Company between the end of financial year (31^st March, 2024) and the date of the report. Similarly, there was no change in the nature of business of the Company during the financial year 2023-24.

Associate / JV Company

FACT-RCF Building Products Limited (FRBL) is a joint venture (JV) company of FACT.CIRP has been initiated in respect of FRBL w.e.f 11.01.2024.Kerala Enviro Infrastructure Limited (KEIL) has ceased to be an Associate Company of FACT. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the associate company / joint ventures in Form AOC-1 is provided as part of the Annual Report.

Report on financial position and Performance of Joint Venture

During the financial year 2023-24, the financial results of FRBL shows a net loss of '' 263.24 Lakhs. Due to the accumulated loss, the entire net worth of FRBL has been eroded. FACT has created provisions for the entire investment made in FRBL.

ISO Certification

Pollution Control Activities

FACT prioritizes ensuring clean air and a better living environment for the inhabitants in and around the factory.

The effluent treatment plant and emission control facilities run year-round. The treated effluents and gas emissions released from the plants meet the standards set by the Central Pollution Control Board and the Kerala State Pollution Control Board.

As per directions from Central Pollution Control Board (CPCB) & Kerala State Pollution Control Board (KSPCB), continuous online monitoring and web uploading are in progress. All analyzers as per guidelines have been installed and the parameters are uploaded in KSPCB & CPCB websites. Caprolactam plant was continuously online during the Financial Year 2023-24.

The Company could maintain all effluent parameters within limits as specified by the statutory authorities. As per an agreement between FACT and Kerala Enviro Infrastructure Limited (KEIL), the accumulated stock of hazardous wastes viz., spent V2O5 catalysts, ETP sludge,Sulphur Muck and E-waste were sent to KEIL for final disposal.

â¢ SO2 emission from Sulphuric Acid plant stack

â¢ Ammonia, Fluoride and particulate matter emission from complex fertilizer plant stack

â¢ Fluoride and particulate matter emission from Phosphoric Acid plant stack.

â¢ pH, Fluoride, Ammoniacal Nitrogen and flow of effluent outlet.

Official Language

FACT continued to give top priority for the propagation and implementation of the Official Language Policy of the Ministry of Home Affairs, Govt. of India from time to time. The Quarterly Meetings of Official Language Implementation Committee is regularly held under the chairmanship of Chairman & Managing Director to review the progressive use of Hindi in Official work.

Workshops,competitions/programmes, Seminar and Hindi Fortnight celebrations were organised during the year.The Company provides incentives to the employees to promote official work in Hindi.

FACT was awarded second prize for its excellent work in the field of Official Language Implementation in the "Hindi Advisory Committeeâ meeting held at New Delhi on 30 May 2023 under the Chairmanship of the Hon''ble Minister of Chemicals and Fertilisers.

FACT was awarded First Prize for Home Magazine Rashtravani and also awarded Rajyabhasha Shield -second prize for its commendable work in the field of Official Language Hindi during the year 2022-23 by Kochi TOLIC (PSU).

Public procurement policy of Micro and Small Enterprises (MSEs) Order 2012

Company is giving priority to Micro and Small Enterprises for procurement as per directives issued by the Government of India from time to time.

During the Financial Year 2023-2024, the Company procured material & services worth '' 335.27 Cr (66.74% of total procurement other than feed stocks & fertilizers) from MSEs. Out of which '' 0.35 Cr (0.07%of total procurement) is from MSEs owned by SC/ST entrepreneurs and '' 13.71 Crore (2.73% of total procurement) is from women entrepreneurs. Most of the feed stocks and Fertiliser inputs procured by FACT are not available with the MSEs.

During the Financial Year 2023-24 FACT has participated in one vendor development programme organized by MSME Development and Facilitation Office, Thrissur.

FACT is registered with TReDs platform of Receivable Exchange of India Limited (RXIL) a joint venture by SIDBI and NSE for providing bill discounting facilities to MSMEs.

Directors and Key Managerial Personnel Appointments

The Department of Fertilizers, vide Order No. 95/1/2019-HR PSU (pt.2) dated 06^thDecember 2023 notified the appointment of Shri. Manoj Sethi (DIN:00301439) as Part-time Government nominee director, on the Board of Directors of FACT.

Government of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers, vide Order No. 86/2/2017-HR-I (Part) dated 22^nd February, 2024 notified the appointment of Shri. S. C. Mudgerikar (DIN:03498837) as Chairman and Managing Director on the Board of Directors of FACT.

Retirements and Resignations

Shri Kishor Rungta (DIN:00231106), Chairman and Managing Director ceased to be a Director of the Company with effect from 01 ^stFebruary, 2024, on completion of his term of appointment.

The Board extends its utmost appreciation for the invaluable services rendered by Shri Kishor Rungta during his tenure as CMD. Under his exemplary leadership, the Company achieved unprecedented milestones in production, sales, turnover, profits, and market capitalization.

In accordance with the order from the Government of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers, Shri Taranjit Singh ceased to be the Government Nominee Director on the Board of the Company effective 7th December 2023.

The Board expresses its gratitude for the contributions made by Shri Taranjit Singh during his tenure as Director of the Company.

Reappointment of Independent Directors

During the financial year 2023-24, no Independent Director was reappointed on the Board of the Company as per section 149 (10) of the Companies Act 2013.

Disqualification of Directors

None of the Directors has incurred any disqualification as provided under section 164 of the Companies Act 2013.

Key Managerial Personnel

In terms of Section 203 of the Act, the Key Managerial Personnel of your company are:

a) Shri. Kishor Rungta, Chairman and Managing Director until 01^st February 2024;

b) Shri. S. C. Mudgerikar, Chairman and Managing Director w.e.f 22^nd February 2024;

c) Shri Anupam Misra, Director (Marketing)

d) Shri. S. Sakthimani, Chief Financial Officer & Director (Finance);

e) Dr. K Jayachandran, Director (Technical)

f) Ms. Susan Abraham, Company Secretary.

Annual Evaluation of Board.

Government of India, Ministry of Corporate Affairs notification dated 5^th June 2015, clause (e) and (p) of subsection 3 of Section 134 of the Companies Act 2013 relating to appointment, remuneration and Annual evaluation of the performance of the Board is not applicable to FACT.

However, the independent directors in a meeting held on 26.03.2024 reviewed the performance of nonindependent directors, reviewed the Board as a whole and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board and reviewed the performance of the Chairperson of the companyas per Regulation 25(4) of SEBI (LODR) Regulations.

Independent Directors'' Declaration

The independent directors made declaration of independence under sub-section (6) of Section 149 of Companies Act, 2013 during the financial year 2023-24. In the opinion of the Board there has been no change in the circumstances affecting their status as independent directors of the company and the Board is satisfied of the integrity, expertise and experience of all Independent Directors on the Board. Further based on the declaration received from directors, the Board confirms, that the Independent Directors fulfill the conditions.

Meetings of the Board

During the financial year 2023-24,four (4) meetings of the Board were convened and held. The details of the meetings of the Board of Directors are given in the report on Corporate Governance, which is part of this report. The intervening gap between the meetings was within the limit prescribed under the Companies Act 2013.

Secretarial Standards

Your Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relating to "Meetings of the Board of Directorsâ and "General Meetingsâ respectively, have been followed by the Company.

AUDITORS

(1) Statutory Auditors and Statutory Auditor''s Report

M/s. G.Venugopal Kamath & Co., Chartered Accountants, Kochi, was appointed as Statutory Auditors of the Company for the financial year 2023-24 by the Comptroller and Auditor General of India.

M/s Shanker Giri & Prabhakar, Chartered Accountants, Chennai, was appointed as Branch Auditors for the year 2023-24, for the Area / Regional Offices at Tamil Nadu and Kerala, by the Comptroller and Auditor General of India.

M/s CKS Associates, Chartered Accountants, Hyderabad, was appointed as Branch Auditors for the year 2023-24 for the Area / Regional Offices at Andhra Pradesh, Telangana and Karnataka States by the Comptroller and Auditor General of India.

Statutory Auditors has not made any qualification or adverse remarks on the Financial Statements for the financial year 2023-24.

(2) Cost Audit

As prescribed under section 148 of the Companies Act ,2013, read with the Companies (Cost Report and Audit) Rules 2014, cost accounting records are being maintained by the Company. M/s BBS & Associates, Cost Accountants, Kochi has been appointed as Cost Auditors of the Company for the year 2023-24. Cost Audit report for the financial year 2022-23 was filed with Ministry of Corporate Affairs on 06^thOctober 2023.

(3) Secretarial Audit

M/s CaesarPintoJohn & Associates, Company Secretaries, Kochi, has been appointed as Secretarial Auditors of the Company for the year 2023-24. The report of the Secretarial Auditor is annexed to this report

as Annexure-2. The Secretarial Auditor has made the following observations in their Secretarial Audit Report.

During the financial year from 01.04.2023 to 31.03.2024, half of the Board of directors of the Company does not comprise of Independent Directors. Two Third of the members of the Audit Committee does not comprise of Independent Directors from 26/05/2023 to 05/07/2023. All the members of the Nomination and Remuneration Committee are not non-executive directors and comprise of only one Independent Director from 26/05/2023 to 05/07/2023

Explanation on observations made by Secretarial Auditors in their report is given below;

FACT is a Central Public Sector Undertaking (PSU). The appointment of all Board members at FACT is based on nominations made by the Department of Fertilizers, under the Ministry of Chemicals & Fertilizers, Government of India. During the interim period between the conclusion of the term of one Independent Director and the appointment of new Independent Directors, requisite number of Independent Directors were not available to constitute the Audit Committee and Nomination & Remuneration Committee as stipulated by the SEBI (LODR) Regulations, 2015.

Audit Committee

In line with the provisions of Section 177 of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 an Audit Committee of the Board has been constituted. Details of Members/ Meetings of the Audit Committee are elaborated in the report on Corporate Governance annexed here with.There were no instances in which the Board has not accepted any recommendation of the Audit Committee.

Public Deposit

During the financial year 2023-24, the Company has not accepted any deposit from public.

Investor Education and Protection Fund (IEPF)

During the year 2023-24 no amount is required to be transferred to Investor Education and Protection Fund and therefore FACT has not transferred any amount to Investor Education and Protection Fund. No amount is pending for transfer to IEPF.

Contract or arrangement with related parties

The transactions entered into with related parties for the year under review were on arms'' length basis and in the ordinary course of business. The disclosure in form No AOC-2 for the transactions with related parties during the period under review is enclosed as Annexure -3.

Corporate Social Responsibility

FACT continued to give priority on various Social Responsibility measures during the financial year 2023-24. The Company has constituted a Board level Committee as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014. Annual Report on CSR as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed to this report as Annexure-4.

Risk Management

FACT has formulated a risk management policy for identification of potential area of risk and mitigation of the same. FACT is having adequate risk management infrastructure in place, capable of addressing all potential risks.

Vigil Mechanism & Whistle Blower Policy

appropriate case. The vigil mechanism and whistle blower policy is published in the web site of the Company www.fact.co.in. and can be download using the link https://fact.co.in/home/ Dynamicpages?MenuId=45 Code of Conduct

FACT is having a code of conduct known as FACT Code of business Conduct and Ethics applicable to the members on the Board and all senior executives of the Company. The code has been posted on the Company''s website www.fact.co.in and can be download using the link https://fact.co.in/home/ Dynamicpages?MenuId=2959

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and senior executives of the Company. It also includes the duties of Independent Directors as laid down in the Companies Act, 2013.

The Board members and Senior Executives of the Company have affirmed compliance of the code of Conduct for the financial year 2023-24.

Prevention of Insider Trading

There have been no reported instances of insider trading involving FACT shares to date. A Code of Conduct on the Prohibition of Insider Trading is available on the Company''s website and can be accessed via the following link: https://fact.co.in/home/Dvnamicpages?MenuId=849.

Particulars of Loan given, Investment made, Guarantees given and Securities provided

Particulars of Investment made by the Company are provided in the financial statement for the year 202324.

During the financial year 2023-24, FACT has not provided any loan/guarantee or made any investment within the purview of Section 186 of the Companies Act 2013.

Internal Controls & their Adequacy

The Company''s internal control systems commensurate with the nature of its business, the size, and complexity of its operations and such internal financial controls with reference to the Financial Statements are adequate. Details on the Internal Financial Controls of the Company forms part of Management Discussion and Analysis forming part of this Integrated Report 2023-24.

Particulars of Employees and related disclosures

During the year under review, none of the employees of the Company had drawn remuneration in excess of the limit prescribed under section 134(3)(c) of the Companies Act, 2013 read with Companies (Appointment of Managerial Personnel) Rules 2014.

As per the notification dated 05^th June, 2015 issued by the Ministry of Corporate Affairs, Government of India, section 197 of the Companies Act, 2013 is not applicable to a Government Company.

Vigilance

Vigilance department in FACT is an integral part of the management function and plays a crucial role in ensuring transparency, integrity and accountability within the organization.The primary objective of the vigilance department in FACT is to prevent corruption, misconduct, fraud and abuse of power thereby upholding the public trust and promoting good governance.

The work profile of Vigilance department includes handling of complaints, investigation of verifiable complaints having vigilance angle, surprise inspections, regular surveillance and intelligence gathering,

scrutiny of procurement/contract files, scrutiny of property returns of employees, monitoring the rotation of staff in sensitive areas, coordination with CVC and other Government Departments.

During the financial year 2023-2024, as per the directives of the Central Vigilance Commission (CVC), the week from October 30^th to 5^th November 2023 was observed as the Vigilance Awareness Week, with the theme "Say No to Corruption; Commit to the Nationâ.

Integrity Pact

An Integrity Pact in line with Government of India guidelines in this regard has been finalised and implemented in the Company.

The Right to Information Act 2005

FACT is complying the provisions of the Right to Information Act 2005 and the details relating to Public Information Officer, Assistant Public Information officer, Appellate Authority, Nodal officer etc. are published on the website of the Company www.fact.co.in and can be download using the link https://fact.co.in/home/Dvnamicpages?MenuId=472

Annual Return

The Annual Return of the Company as provided under Sub section (3) of Section 92 of Companies Act, 2013,is published on the website of the Company, https://fact.co.in/home/Dynamicpages?MenuId=41

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

Information regarding the conservation of energy, technology absorption, and foreign exchange earnings and-outgo as required to be disclosed in terms of the Companies (Accounts) Rules 2014 is set out in a separate statement as Annexure-1.

Director''s Responsibility Statement

Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors hereby state that:

(a) in the preparation of annual accounts for the year ended March 31,2024, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2024 and of profit and loss statement for the year ended March 31,2024.

(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 were operating effectively; and

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

General

The Board of 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.

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the company under any scheme.

4. The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

5. Neither the Managing Director nor the whole time Directors of the Company receive any remuneration or commission from its Associate Company.

6. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

7. No fraud has been reported by the auditors to the Audit Committee or to the Board.

8. There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year under review.

9. The Company has not made any one-time settlement for the loans taken from the Banks or Financial Institutions.

Acknowledgement

The Directors also acknowledge the continued support extended by the Shareholders, Dealers, Suppliers, Bankers, Valued Customers and Auditors of the Company, the Press and Electronic Media.

For and on behalf of the Board of Directors.

(S.C. Mudgerikar)

Place : Udyogamandal Chairman and Managing Director

Date: 03.09.2024 DIN-03498837

Mar 31, 2023

Your Directors have pleasure in presenting the79th Annual Report on the business and operations and the Audited Standalone and Consolidated Financial Statements of the Company for the Financial Year ended 31^st March, 2023 and Auditors Report thereon.

Your Directors are extremely happy to inform you that during the financial year 2022-23, the Company has achieved very good performance in the production, marketing and financial front. The Company has achieved highest ever turnover of '' 6198 Cr and earned a net profit of '' 612.99 Crore.

The Financial Year 2022-23 witnessed unprecedented volatility on the prices of fertiliser inputs like Ammonia, Phosphoric Acid, Sulphuric Acid, Natural Gas etc due to various geopolitical reasons. Your Company was able to successfully navigate the situation by taking appropriate business decisions, entering into long term contract for supply of fertiliser inputs and improvement in logistics.

During the Financial Year 2022-23, FACT celebrated its 75 years of fertiliser production and service to the nation.

Based on Market Capitalization, as on March 31, 2023, your Company is one among the top 500 listed Companies.

Performance Highlights;

â¢ Net profit of '' 612.99 Cr.

â¢ All time high turnover '' 6198.15 Cr.

â¢ Total fertiliser production 10.73 Lakh MT.

â¢ Production of 44,754 MT Caprolactam

â¢ Sale of 995815 MT Fertilisers.

â¢ Sale of 43,712 MT Caprolactam

â¢ Long term contract with IOCL for supply of RLNG

â¢ Established 172 PMKSK shops across marketing territories.

â¢ Commissioning of CAPEX projects

1. Financial Results (Standalone)

Financial Results of the Company for the year ended March 31,2023 is summarized below:		Rs. in Crore
Particulars	2022-23	2021-22
Net Sales	6198.15	4424.80
Other Income	135.57	111.23
Total Revenue	6333.72	4536.03
Total Expenses	5720.73	4100.59
Profit before Exceptional Items and Tax	612.99	435.43
Exceptional Items	0	-89.06
Earnings before interest, depreciation and Taxes (EBIDTA)	890.44	617.64
Interest	247.34	244.07
Depreciation	30.11	27.19
Profit for the year	612.99	346.38
Other comprehensive Income	-1.11	16.09
Total Comprehensive Income	611.88	362.47

In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board of Directors of the Company (the Board) has formulated and adopted the Dividend Distribution Policy. The policy is hosted on the website of the Companyand can be accessed through the linkhttps://fact.co.in/home/Dvnamicpages?MenuId=914

Dividend

For the financial year 2022-23, the Board has recommended a Dividend of '' 1 per equity share of face value of ''10/- each. The Board has recommended dividend based on the parameters laid down in the Dividend Distribution Policy. The dividend will be paid out of the profits for the year 2022-23.

The Dividend on equity shares is subject to the approval of shareholders at the Annual General Meeting scheduled to be held on 29 September 2023.

Based on the number of equity shares, as on date of this report, the dividend, if approved would result in cash outflow of '' 64.70 Crore.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profit in the profit and loss account. No amount has been transferred to reserves for the Financial Year 2022-23.

Operations and Performance Production

During the Financial Year 2022-23, the production of Factamfos increased marginally by 1643 tonnes as compared to previous year. The production of Ammonium Sulphate and Caprolactam increased by 108067 tonnes and 23919 tonnes respectively.

Production	(in MT)	(in MT)
	2022-23	2021-22
Factamfos	828195	826552
Ammonium Sulphate	244732	136665
Caprolactam	44754	20835

Marketing

During the Financial Year 2022-23, the sale of Factamfos decreased by 10% as compared to previous year whereas the sale of Ammonium Sulphate increased by 52%.The sale of Caprolactam increased by 110%as compared to previous year.

Sale	2022-23 (In Lakh MT)	2021-22 (In Lakh MT)
Factamfos	7.43	8.32
Ammonium Sulphate	2.20	1.45
Caprolactam	0.44	0.21

The Company expanded fertiliser marketing area to the states of Maharashtra, Gujarat, West Bengal, Odisha and Bihar during the Financial Year 2022-23.

Memorandum of Understanding with Government of India

Your Company has been entering into a Memorandum of Understanding (MoU) with the Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, setting the performance parameters and targets every year. The evaluation of MoU performance for the Financial Year 2022-23 is yet to be completed.

The MoU for 2023-24 is under finalisation by the Govt. of India.

Management Discussion and Analysis Report covering the operational aspects for the year under review, as stipulated under SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015(as amended) is presented in a separate section forming part of Directors'' Report.

Roadmap for sustainability / Capital Projects

During the Financial Year 2019-20, Union Cabinet has accorded approval for CAPEX worth '' 608 crores for implementing essential capital jobs with a view to enhance the reliability of production plants and compliance with changing statutory requirements and setting up of additional raw material storage tanks. Critical renovation and modernizing schemes for debottlenecking raw material and product handling facilities also form part of CAPEX.

FACT is in the process of commissioning / implementing various CAPEX projects to enhance the production capacity and the sustainable growth of the Company in the long run.

During the financial year 2022-23, the Company has commissioned the following projects.

â¢ New Ammonia Barge for transporting Ammonia between production Divisions and Cochin Port through inland waterways.

â¢ Two additional Sulphuric Acid storage tanks of 5000 MT capacity each, at Cochin Division, Ambalamedu.

Reconstruction of Berth at Cochin Port utilising the financial assistance under '' Sagar Mala Scheme'' is completed.

Other CAPEX projects including 1650 TPD NP project are progressing as per schedule. The NP project is expected to be commissioned during the year 2024-25.

Commissioning of the CAPEX project would result in an increase in fertiliser production of the Company from 10 lakh MT to 14 lakh MT and considerable increase in turnover and profit.

Sustainable Development

Your Company is giving priority on implementing several sustainable development activities. Fuel in driers of phosphate plants was changed from furnace oil to Re-gassified Liquefied Natural Gas (RLNG) in the year 2022-23. Changing the fuel to natural gas is a step towards conservation of energy as RLNG is a clean fuel, providing better efficiency in combustion.

Industrial Relations

During the Financial Year 2022-2023, cordial industrial relations were maintained across all Divisions of the Company. Pay revision for the period 1.1.2017 - 31.12.2026 effective from 1.4.2022, was implemented.

Corporate Governance

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Board lays emphasis on transparency and accountability for the benefit of all stakeholders of the Company. The Report on Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annexed to this report, forms an integral part of this report.

Business Responsibility and Sustainability Report

In accordance with Regulations 34(2)(f) of the SEBI Listing Regulations, the Securities and Exchange Board of India (SEBI), in May 2021 introduced new sustainability related reporting requirements to be reported in the specific format of Business Responsibility and Sustainability Report (BRSR). BRSR is a significant step towards giving platform to the Companies to report the initiative taken by them in the areas of environment, social and governance. SEBI has mandated top 1000 Listed Companies, based on market capitalisation to publish BRSR from Financial Year 2022-23 onwards. Accordingly, your directors are glad to present the BRSR report of FACT for the financial year 2022-23 and it is part of the Annual Report of the Company.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2023, prepared in accordance with Section 129(3) of the Companies Act 2013 and relevant accounting standards form part of the Annual Report.

The Consolidated Financial Statements have been prepared under equity method along with Company''s Standalone Financial Statements.

Material changes and commitment

There were no material changes and commitments affecting the financial position of the Company between the end of Financial Year (31^st March, 2023) and the date of the report. Similarly, there was no change in the nature of business of the Company during the Financial Year 2022-23.

Associate Company or Joint Venture

FACT-RCF Building Products Limited (FRBL) is a Joint Venture (JV) Company of FACT. During the Financial Year 2022-23, Kerala Enviro Infrastructure Limited (KEIL) has ceased to be an Associate Company of FACT. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the associate company / joint ventures in Form AOC-1 is provided as part of the Annual Report.

Report on financial position and Performance of Joint Venture

During the Financial Year 2022-23, the financial results of FRBL shows a net loss of ''.7.9 Crores. Due to the accumulated loss, the entire networth of FRBL has been eroded. The Company has created provisions for the entire investment made in FRBL.

ISO Certification

Pollution Control Activities

FACT gives top priority to ensure clean air and better living environment to the inhabitants in and around the factory.

The effluent treatment plant and emission control facilities are kept in operation along with the plant throughout the year. Treated effluents and gas emissions discharged from plants conform to the standards prescribed by the Kerala State Pollution Control Board.

As per directions from Central Pollution Control Board (CPCB)&Kerala State Pollution Control Board (KSPCB), continuous online monitoring and web uploading are in progress. All analysers as per guidelines have been installed and the parameters are uploaded in KSPCB & CPCB websites. Caprolactam plant was continuously online during the Financial Year 2022-23.

The Company could maintain all effluent parameters within limits as specified by the statutory authorities. As per an agreement between FACT and Kerala Enviro Infrastructure Limited (KEIL), the accumulated stock of hazardous wastes viz., spent V2O5 catalysts, ETP sludge, Sulphur Muck and E-waste were sent to KEIL for final disposal.

Scheme for solid waste management is being implemented by providing separate Bin for metal scraps bio degradable and non-bio degradable wastes. The waste is collected and further segregated at designated facility.

â¢ SO2 emission from Sulphuric Acid plant stack

â¢ Ammonia, Fluoride and particulate matter emission from complex fertilizer plant stack

â¢ Fluoride and particulate matter emission from Phosphoric Acid plant stack.

â¢ pH, Fluoride, Ammoniacal Nitrogen and flow of effluent outlet.

Official Language

FACT continued to give top priority for the implementation of the Official Language Act and Rules issued by the Ministry of Home Affairs, Govt. of India from time to time. Meetings of Official Language Implementation Committee is being conducted regularly under the chairmanship of Chairman & Managing Director. In order to create enthusiasm in Official Language Hindi among the employees, FACT is regularly conducting Hindi Programmes and Competitions for the employees and officers of various Divisions of the Company. Hindi Fortnight Celebration and Official Language Seminar were conducted at corporate level. The Company is organizing Official Language Workshops, Training Programmes, and Spoken Hindi Classes for employees on monthly basis to give awareness of Official Language Act and Rules. In order to do more official work in Hindi, the company is giving attractive Cash Incentives to the employees.

FACT won the First place for the excellent performance in Official Language from the Kochi Town Official Language Implementation Committee during the year 2020-21 which was awarded in December, 2022.

Azadi Ka Amrut Mahotsav

While India moves towards the dream of accomplishing good governance, development, global peace and spreading patriotic feelings throughout the Nation as part of the completion of 75 years of India''s Independence, the employees of FACT also celebrated Azadi Ka Amrut Mahotsav by organising series of events like Blood donation campaign, Mini marathon, Dealers Meetings etc.

Public procurement policy of Micro and Small Enterprises (MSEs) Order 2012

Company is giving priority to Micro and Small Enterprises for procurement as per directives issued by the Government of India from time to time.

During the Financial Year 2022-2023, the Company procured material worth '' 268.60 crorefrom MSEs. Out of which '' 3.72 Cr (1.4%) is from MSEs owned by SC/ST entrepreneurs and '' 2.20 Crore (0.82%) is from women entrepreneurs. Most of the feed stocks and Fertiliser inputs procured by FACT are not available with the MSEs. FACT has paid all dues pertaining to MSEs and no amounts are pending to MSMEs as on date.

FACT is registered with TReDs platform of Receivable Exchange of India Limited (RXIL) a joint venture by SIDBI and NSE for providing bill discounting facilities to MSMEs.

During the Financial Year 2022-23 FACT has conducted one vendor development programme, in cooperation with Government e-Marketplace (GeM) with special emphasis on procurement through GeM, seller registration in GeM etc.

Directors and Key Managerial Personnel

Appointments

Government of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers, vide Order No. 86/1/2017-HR-I dated 02^nd March, 2023 notified the appointment of Dr.Jayachandran K as Director (Technical) on the Board of Directors of FACT.

The Department of Fertilizers, vide Order No. 95/1/2019-HR PSU dated 10th February 2023 notified the appointment of Shri Avtar Singh Sandhu as Part-time Government nominee director, on the Board of Directors of FACT.

The Department of Fertilizers, vide Order No. F.No.78/2/2006-HR-I (pt. III) dated 20.06.2023 also notified the appointment of Shri M Chandran and Shri Keda Tanaji Aher as Non-Official Part-time Directors (Independent Director) on the Board of Directors of FACT.

The Department of Fertilizers, vide Order No. 95/1/2019-HR PSU (pt. 2) dated 04.08.2023 also notified the appointment of Shri Taranjit Singh as Part-time Government Nominee Director on the Board of Directors of FACT.

Retirements and Resignations

On superannuation, Shri A S Kesavan Namboothiri, Director (Technical) ceased to be a Directorof the Company with effect from 30th September 2022.

Consequent to the Order of the Govt. of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers, Ms. Deepika Jain ceased to be the Government Nominee Director on the Board of the Company with effect from 17th February 2023.

On completion of three year term Shri Rabinarayan Patra Independent Director retired from the Board of FACT with effect from 7^th May 2023.

Consequent to the Order of the Govt. of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers, Sri. Avtar Singh Sandhu ceased to be the Government Nominee Director on the Board of the Company with effect from 04th August 2023.

The Board places on record its appreciation for the valuable services rendered by Shri. A S Kesavan Namboothiri, Ms. Deepika Jain, Shri. Rabinarayan Patra and Sri. Avtar Singh Sandhu during their tenure as Directors of the Company.

Reappointment of Independent Directors

During the Financial Year 2022-23, no Independent Director was reappointed on the Board of the Company as per section 149 (10) of the Companies Act 2013.

Disqualification of Directors

None of the Directors has incurred any disqualification as provided under section 164 of the Companies Act 2013.

Annual Evaluation of Board.

FACT being a Government Company, all appointments on the Board is made by the Government of India, Ministry of Chemicals and Fertilizers, Department of Fertilizers. The performance of Directors is evaluated by the Ministry of Chemicals & Fertilizers, Department of Fertilizers, Government of India. As per Government of India, Ministry of Corporate Affairs notification dated 5^th June 2015, clause (e) and (p) of subsection 3 of Section 134 of the Companies Act 2013 relating to appointment, remuneration and Annual evaluation of the performance of the Board is not applicable to FACT.

However, the Independent Directors in a meeting held on 30.03.2023 reviewed the performance of nonIndependent Directors, reviewed the Board as a whole and assessed the quality, quantity and timeliness of flow of information between the Company management and the Board and reviewed the performance of the Chairperson of the Company as per Regulation 25(4) of SEBI (LODR) Regulations.

Declaration of Independent Directors

The Independent Directors made declaration of independence under sub-section (6) of Section 149 of Companies Act, 2013 during the Financial Year 2022-23.

Meetings of the Board

During the Financial Year 2022-23, five (5) meetings of the Board were convened and held. The details of the meetings of the Board of Directors are given in the report on Corporate Governance, which is part of this report. The intervening gap between the meetings was within the limit prescribed under the Companies Act 2013.

Secretarial Standards

Your Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relating to "Meetings of the Board of Directorsâ and "General Meetingsâ respectively, have been followed by the Company.

AUDITORS

(1) Statutory Auditors and Statutory Auditor''s Report

M/s. K Venkatachalam Aiyer& Co., Chartered Accountants, Kochi, wasre-appointed as Statutory Auditors of the Company for the Financial Year 2022-23 by the Comptroller and Auditor General of India.

M/s Raja & Kumar, Chartered Accountants, Chennai, was appointed as Branch Auditors for the year 202223, for the Area / Regional Offices at Tamil Nadu and Kerala, by the Comptroller and Auditor General of India. M/s CKS Associates, Chartered Accountants, Hyderabad, was appointed as Branch Auditors for the year 2022-23 for the Area / Regional Offices at Andhra Pradesh, Telengana and Karnataka States by the Comptroller and Auditor General of India.

Statutory Auditors has not made any qualification or adverse remarks on the Financial Statements for the Financial Year 2022-23.

(2) Cost Audit

As prescribed under section 148 of the Companies Act ,2013, read with the Companies (Cost Report and Audit) Rules 2014, cost accounting records are being maintained by the Company. M/s Rajendran, Mani & Varier, Cost Accountants, Kochi has been appointed as Cost Auditors of the Company for the year 2022-23. Cost Audit report for the Financial Year 2021-22 was filed with Ministry of Corporate Affairs on 28^thSeptember 2022.

(3) Secretarial Audit

M/s SVJS & Associates, Company Secretaries, Kochi, has been appointed as Secretarial Auditors of the Company for the year 2022-23. The report of the Secretarial Auditor is annexed to this report as Annexure-1. The Secretarial Auditor has made the following observations in their Secretarial Audit Report.

1. As per Regulation 31 (2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, "the listed entity shall ensure that hundred percent of shareholding of promoter(s) and promoter group is in dematerialized form and the same is maintained on a continuous basis in the manner as specified by the Board.â However, 700 shares held by the promoter and promoter group are not maintained in dematerialized form.

2. The Board of directors of the Company comprises of Executive and Non-Executive Directors. As per Regulation 17 (1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the board of directors shall have an optimum combination of executive and non-executive directors with at least one-woman director and not less than fifty per cent of the board of directors shall comprise of non-executive directors. During the financial year 01.04.2022 to 31.03.2023, fifty per cent of the Board of directors of the Company does not comprise of Independent Directors and non-executive directors. The Company has not appointed a woman independent director upto 18/04/2022. Two Third of the members of the Audit Committee does not comprise of Independent Directors upto 06/05/2022. The members of the Nomination and Remuneration Committee do not comprise of nonexecutive directors and comprise of only one Independent Director upto 06/05/2022. The Nomination Remuneration Committee comprises of executive directors as well.

Explanation on observations made by Secretarial Auditors in their report is given below;

1 The entire promoter(s) and promoter group shares are in dematerialized form except for the 700 shares held by the nominee shareholders, holding on behalf of the President of India.

2. Being a Central PSU, the members on the Board of FACT are nominated by the Department of Fertilizers, Ministry of Chemicals & Fertilizers, Govt. of India. On appointment of woman Independent Director w.e.f 18.04.2022 and subsequent reconstitution of the Committees w.e.f. 06.05.2022, the Company complied with the SEBI (LODR) Regulations, 2015, except Regulation 17(1). The Company will comply the provisions of regulations 17(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, once the notification on appointment of Independent Directors is issued by the Government of India.

Audit Committee

In line with the provisions of Section 177 of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 an Audit Committee of the Board has been constituted. Details of Members/ Meetings of the Audit Committee are elaborated in the report on Corporate Governance annexed here with. There were no instances in which the Board has not accepted any recommendation of the Audit Committee.

Public Deposit

During the Financial Year 2022-23, the Company has not accepted any deposit from public.

Investor Education and Protection Fund (IEPF)

During the year 2022-23 no amount is required to be transferred to Investor Education and Protection Fund and therefore FACT has not transferred any amount to Investor Education and Protection Fund. No amount is pending for transfer to IEPF.

Contract or arrangement with related parties

The transactions entered into with related parties for the year under review were on arms length basis and in the ordinary course of business. The disclosure in form No AOC-2 for the transactions with related parties during the period under review is enclosed as Annexure -2.

Corporate Social Responsibility

FACT continued to give priority on various Social Responsibility measures during the Financial Year 2022-23. The Company has constituted a Board level Committee as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014. Annual Report on CSR as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed to this report as Annexure-2A.

Risk Management

Vigil Mechanism& Whistle Blower Policy

FACT is having a vigil mechanism for directors and employees to report their concerns. The Directors and employees can approach Chairman, Audit Committee of the Board directly and report their concern in appropriate case. The vigil mechanism and whistle blower policy is published in the web site of the Company www.fact.co.in. and can be download using the link https://fact.co.in/home/ Dynamicpages?MenuId=45 Code of Conduct

FACT is having a code of conduct known as FACT Code of business Conduct and Ethics applicable to the members on the Board and all senior executives of the Company. The code has been posted on the Company''s website www.fact.co.inand can be download using the link https://fact.co.in/home/ Dynamicpages?MenuId=2959

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and senior executives of the Company.

The Board members and Senior Executives of the Company have affirmed compliance of the code of Conduct for the Financial Year 2022-23.

Prevention of Insider Trading

No instances of insider trading have been reported on FACT shares till date. A Code of Conduct on Prohibition of Insider Trading is published in the website of the company and can be download using the link https://fact.co.in/home/Dynamicpages?MenuId=849 .

Particulars of Loan given, Investment made, Guarantees given and Securities provided

Particulars of Investment made by the Company, are provided in the financial statement for the year 202223. During the Financial Year 2022-23, FACT has not provided any loan/guarantee or made any investment within the purview of Section 186 of the Companies Act 2013.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has formulated a Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received relating to sexual harassment.

Following are the summary of sexual harassment complaints received and disposed of during the period under review:

Number of complaints at the beginning of the year: 2 Number of complaints received during the year: 0

Number of complaints disposed of during the year: 2 Number of complaints at the end of the year: 0

Particulars of Employees

During the year under review, none of the employees of the Company had drawn remuneration in excess of the limit prescribed under section 134 (3) (c) of the Companies Act, 2013 read with Companies (Appointment of Managerial Personnel) Rules 2014.

Vigilance

Vigilance department in FACT is an integral part of the management function. This department functions with the concept of "Vigilance for Corporate Excellenceâ and works with a mottoâcommitted to Institute and Internalize ethical practices in FACTâ. Adopting an approach of proactive and preventive vigilance, this department strives to improve the quality management systems within FACT by creating a corruption free environment for each individual to strive for high level performance towards achieving the Vision and Mission of FACT.

The work profile of Vigilance department includes investigation of complaints received from various sources, surprise inspections, regular surveillance/intelligence gathering, scrutiny of procurement/contract files, scrutiny of property returns of employees, coordination with CVC and other Government Departments.

During the Financial Year 2022-2023, the Company has observed Vigilance Awareness Week with the theme Corruption free India for a developed Nation, from 31st October 2022 - 6th November, 2022, in line with the decision of Central Vigilance Commission and conducted several programs to create vigilance awareness.

Integrity Pact

An Integrity Pact in line with Government of India guidelines in this regard has been finalised and implemented in the company.

The Right to Information Act, 2005

FACT is complying the provisions of the Right to Information Act, 2005 and the details relating to Public Information Officer, Assistant Public Information officer, Appellate Authority, Nodal officer etc. are published in the website of the Company www.fact.co.in and can be download using the link https://fact.co.in/home/Dynamicpages?MenuId=472 Annual Return

The Annual Return of the Company as provided under sub section (3) of Section 92 of Companies Act, 2013, is published on the website of the Company, www.fact.co.in.

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

Director''s Responsibility Statement

Pursuant to Section 134(3) (c) of the Companies Act, 2013, your Directors hereby state that:

(a) in the preparation of annual accounts for the year ended March 31, 2023, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2023 and of profit and loss statement for the year ended March 31,2023.

(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 were operating effectively; and

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

General

The Board of 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.

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the company under any scheme.

4. The Company does not have any scheme of provision of money for the purchase of its own shares

by employees or by trustees for the benefit of employees.

5. Neither the Managing Director nor the whole time Directors of the Company receive any remuneration or commission from its Associate Company.

6. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

7. No fraud has been reported by the auditors to the Audit Committee or to the Board. Acknowledgement

Your Directors gratefully acknowledge the valuable guidance and support extended by Hon''ble Minister of Chemicals and Fertilizers, Hon''ble Minister of State for Chemicals and Fertilizers, Hon''ble Chief Minister, Government of Kerala, the Secretary, Ministry of Chemicals and Fertilizers and other officials of the Ministry of Chemicals and Fertilizers as well as other Ministries of the Government of India, Department of Public Enterprises and the State Governments of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Bihar, Odisha, Maharashtra ,West Bengal and Union Territory of Puducherry.

The Directors also acknowledge the continued support extended by the Shareholders, Dealers, Suppliers, Bankers, Valued Customers and Auditors of the Company, the Press and Electronic Media.

Mar 31, 2022

Your Directors are pleased to present the 78^th Annual Report and the Audited Standalone and Consolidated Financial Statements of the Company for the Financial Year ended 31^st March, 2022 and Auditors Report thereon.

Your Directors are extremely happy to inform you that during the financial year 2021-22, the Company has achieved highest ever turnover and earned a profit of H 353.28 Crore. The net worth of the Company has become positive after a gap of Nine years.

The financial year 2021 -22 was a challenging year for the fertilizer industry in India. Sky rocketing prices of fertilizer inputs, non-availability of imported fertilizers, unprecedented increase in the price of Hydro Carbons etc. have affected the fertilizer industry in the last financial year. The spread of Covid-19 pandemic has also affected manufacturing operations. Your Directors are happy to inform you that, despite all these adversities FACT could continue its excellent production and marketing performance during the year 2021-22.

During the financial year 2021 -22, the Company could market more than one million tons of fertilizers. Another land mark event during the financial year 2021-22 was restart of Caprolactam plant after a gap of Nine years. Performance Highlights;

â¢ Net Profit of H 353.28 Cr

â¢ All time high turnover of H 4425 Cr

â¢ Net worth of the Company has become positive

â¢ Total fertilizer production of 9.63 Lakh MT

â¢ Sales of 1 million MT Fertilizers

â¢ Restarted Caprolactam production

â¢ All time high ammonia sales of 11,937 MT

â¢ Order placed for major CAPEX schemes

â¢ Considerable improvement in the sale of Industrial Chemicals

â¢ Safety awards from Factories & Boilers, Govt. of Kerala and National Safety Council, Kerala Chapter Performance 2021-22

1. Financial Performance (Standalone)

Financial Performance of the Company for the year ended March 31,2022 is summarized below:

H in crores
Particulars	2021-22	2020-21
Net Sales	4424.80	3258.82
Other Income	117.64	67.59
Total Revenue	4542.44	3326.41
Total Expenses	4100.10	2975.95
Profit before Exceptional Items and Tax	442.34	350.47
Exceptional Items	-89.06	0
Earnings before interest, depreciation and Taxes (EBIDTA)	624.82	618.42
Interest	244.40	245.26
Depreciation	27.14	22.69
Profit for the year	353.28	350.47
Other comprehensive Income	16.09	-35.03
Total Comprehensive Income	369.37	315.44

Dividend

Due to accumulated loss, your directors have not recommended any dividend for the financial year 2021 -22. The Company has not transferred any amount to Reserve during the financial year 2021 -22.

2. Production

Production	2021-22 (in MT)	2020-21 (in MT)
Factamfos	826552	861455
Ammonium Sulphate	136665	245676
Caprolactam	20835	0

In Production front, Factamfos production for the fiscal 2021-22 was 8.27 lakh MT and Ammonium Sulphate 1.37 Lakh MT, as compared to 8.61 Lakh MT and 2.45 lakh MT respectively during the previous year. With the restart of Caprolactam operations, Ammonium Sulphate is generated as a co-product from Caprolactam operations. Stabilization of the Caprolactam plant and Ammonia shortage during the first half of the financial year 2021-22 on account of overhauling of critical equipment by the OEM in Ammonia Plant has affected the production of Ammonium Sulphate.

Company restarted the Caprolactam production during September, 2021 after a gap of Nine years. The restart of Caprolactam operation would result in reduction in import of Caprolactam and is a step towards âAtmanirbhar Bharat Abhiyanâ Policy of the Govt. of India.

3. Marketing

During the financial year 2021-22, Factamfos sale was 8.32 lakh MT and Ammonium Sulphate sale was 1.44 lakh MT as compared to 9.23 lakh MT and 2.51 lakh MT respectively during the financial year 2020-21.

Cumulative fertilizer sale for the year surpassed One Million MT.

The Company recaptured the markets in Andhra Pradesh, Telangana, Karnataka and steps have been taken to develop markets in Maharashtra, Gujarat, West Bengal, Odisha and Bihar during the financial year 2021-22.

During the financial year 2021-22, trading of industrial products like Caprolactam and Chemicals like Ammonia, Sulphuric Acid Gypsum and CO₂ have achieved a turnover of H 516 Crore with a sales volume of 4.9 Lakh MT.

Material changes and commitment

There were no material changes and commitments affecting the financial position of the company between the end of financial year (31^st March, 2022) and the date of the report. Similarly, there was no change in the nature of business of the company during the financial year 2021 -22.

Power Purchase through Open Access

During the year 2020-21, the Company has started procurement of power from Indian Electricity Exchange (IEX) through competitive bidding on a day-ahead basis. This allows the Company to procure power from a number of generating companies linked to IEX on competitive rates, rather than buying from Kerala State Electricity Board Limited. During the year 2021-22, the Company purchased 14769.45 MW power from Indian Electricity Exchange. The saving from open access power is approximately H 1.4 Crore.

Memorandum of Understanding with Government of India

Your Company has been entering into a Memorandum of Understanding (MoU) with the Department of Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, setting the performance parameters and targets every year. Your Company has secured âVery goodâ rating for the MoU for the year 2020-21.

The performance rating for 2021-22 MoU is yet to be finalised by the Govt. of India.

COVID-19

During financial year 2021-22, COVID-19 pandemic developed rapidly, resulting in formation of cluster and affected the movement of men and material. By making suitable adaptations in the operation schedule, raw material planning, logistics, product despatch and marketing arrangements, FACT could minimise the impact of COVID-19 during the financial year 2021 -22.

Company took all possible steps to contain the outbreak of COVID -19 in all the divisions of the Company by providing thermal scanners at entry points, sanitizers, hand washes, adopting steps for social distancing, distribution of face masks, dissemination of information among employees for creating awareness, continuous sanitation of all areas, distribution of homoeo medicines for employees and their families, control of visitors, etc. Indigenous foot operated and electronic sanitizer dispensing machines were developed and installed at all entry levels.

The Company is maintaining its operations adhering to COVID-19 protocols and do not expect any major impact on COVID-19 in the day to day activities.

Management Discussion and Analysis Report

Corporate Governance

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Board lays emphasis on transparency and accountability for the benefit of all stake-holders of the Company. The Report on Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 annexed to this report forms an integral part of this report.

Business Responsibility Report

The Business Responsibility Report as stipulated under Regulation 34 (2) of SEBI (LODR) Regulations, 2015 is presented in a separate section and forms part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2022, prepared in accordance with Section 129(3) of the Companies Act 2013 and relevant accounting standards form part of the Annual Report.

The Consolidated Financial Statements have been prepared under equity method along with Companyâs Standalone Financial Statements.

Associate Company

FACT-RCF Building Products Limited (FRBL) and Kerala Enviro Infrastructure Ltd. (KEIL) are the associate companies of FACT. During the financial year 2021-22, no Company has become/ceased to become subsidiaries/Joint Ventures/ Associate Company of FACT. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the associate companies and joint ventures in Form AOC-1 is provided as part of the Annual Report.

Report on financial position and Performance of Joint Venture

During the financial year 2021-22, the financial results of FRBL shows a net loss of D 8.58 Crores. Due to the accumulated loss, the entire net worth of FRBL has been eroded. The Company has created provisions for the entire investment made in FRBL.

The financial results of Kerala Enviro Infrastructure Ltd. for the financial year 2021-22 shows a net loss of D 5.79 Crore.

Sustainable Development

Your Company is giving priority on implementing several sustainable development activities. FACT Cochin Division is having 10 KW Solar unit and is planning for 6 MW solar energy project to increase sustainable energy input.

Roadmap for sustainability / Capital Projects

During the financial year 2019-20, Union Cabinet has accorded approval for CAPEX worth Rs. 608 crores for implementing essential capital jobs with a view to enhance the reliability of production plants and compliance with changing statutory requirements and setting up of additional raw material storage tanks and 1650 TPD Factamfos plant. Critical renovation and modernizing schemes for debottlenecking raw material and product handling facilities also form part of CAPEX.

Details of major projects, which have been completed during financial year 2021-22 and the projects which are in progress are summarized below;

> RLNG conversion of NP A stream.

> Construction and erection of evaporator cum economizer (W4) in Sulphuric Acid plant.

> Construction of new Ammonia Barge.

> Transfer and extension of Ammonia ship unloading facility at Willingdon Island to Q1 berth.

> Installation of Ammonia, Sulphur Dioxide and LPG leak detectors in various location in Cochin Division and Willingdon Island.

> 1650 MTPD NP plant.

> Construction of 10000 MT Ammonia storage tank at Cochin Division.

> Construction of two additional Sulphuric Acid storage tanks (5000 MT capacity) at Cochin Division

> Construction of two Phosphoric Acid storage tanks (5900 MT each) at Willingdon Island.

> Fabrication of new evaporator (W3) for replacement of existing old evaporator in Sulphuric Acid plant.

> Reconstruction of South Coal Berth (Ammonia Handling) at Willingdon Island under Sagarmala scheme.

> Installation of new pipe lines for unloading Sulphuric Acid and Phosphoric Acid from Q9 Berth of Cochin Port.

ISO Certification

Pollution Control Activities

FACT gives top priority to ensure clean air and better living environment to the inhabitants in and around the factory.

The Company could maintain all effluent parameters within limits as specified by the statutory authorities. As per an agreement between FACT and Kerala Enviro Infrastructure Limited (KEIL), the accumulated stock of hazardous wastes viz., spent V2O5 catalysts, ETP sludge, Sulphur Muck and E-waste were sent to KEIL for final disposal.

Scheme for solid waste management is being implemented.

> SO2 emission from Sulphuric Acid plant stack

> Ammonia, Fluoride and particulate matter emission from complex fertilizer plant stack

> Fluoride and particulate matter emission from Phosphoric Acid plant stack.

> pH, Fluoride, Ammoniacal Nitrogen and flow of effluent outlet.

Official Language

FACT is giving utmost priority for the implementation of the Official Language Act and Rules issued from time to time by the Ministry of Home Affairs, Government of India. Meetings of the Official Language Implementation Committee are held regularly under the chairmanship of Chairman & Managing Director of the Company. In order to create enthusiasm in the Official Language among the employees, Hindi Department regularly organize several programs for the employees and officers of the various divisions of the company. Hindi Fortnight is celebrated at corporate level with various competitions and prizes are given to the winners.

The Company is organizing Hindi Workshops and training programmes for employees on quarterly basis to give information about Official Language Rules. In order to do more official work in Hindi, the company gives cash incentives to the employees.

Awards and recognitions

During the financial year 2021-22 FACT was bestowed with various awards in recognition of the services rendered to the society. Some of the awards bestowed on FACT is mentioned below;

1. FACT secured first place for best implementation of Official Language Hindi.

2. FACT secured first prize for Official Language Magazine âRashtravaniâ

3. FACT Udyogamandal Complex won the Safety award - 2021 in the category of Very large chemical factories constituted by Factories and Boilers department, Government of Kerala

4. FACT Udyogamandal Complex won the SURAKSHA PURASKAR for outstanding safety Performance in Very Large Chemical Factories constituted by National Safety Council Kerala Chapter (NSC KC).

5. FACT Cochin Division won the award for Best Safety Committee - 2021 from the Factories and Boilers department, Government of Kerala.

6. FACT - Udyogamandal Complex team won the first prize in table top mock drill constituted by National Safety Council Kerala Chapter (NSC KC).

7. FACT - Udyogamandal Complex team won the first prize in safety skit competition constituted by National Safety Council Kerala Chapter (NSC KC).

Public procurement policy of Micro and Small Enterprises (MSEs) Order 2012

Company is giving priority to Micro and Small Enterprises for procurement as per directives issued by the Government of India from time to time.

During the financial year 2021-2022, the Company procured material worth H 245.61 crore from MSEs. Most of the feed stocks and Fertiliser inputs procured by FACT are not available with the MSEs. FACT has paid all dues pertaining to MSEs and no dues are pending as on date.

FACT is registered with TReDs platform of Receivable Exchange of India Limited (RXIL) a joint venture by SIDBI and NSE for providing bill discounting facilities to MSMEs.

Directors and Key Managerial PersonnelAppointments

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No:95/1/2019-HR PSU dated 29-09-2021, notified the appointment of Ms. Deepika Jain as a Govt. of India Nominee Director on the Board of Directors of FACT.

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No FI No 78/2/2006-HR-PSU(pt) dated 28^th March 2022 notified the appointment of Prof. Anjula Murmu as a Non-Official Part-time Director (Independent Director) on the Board of Directors of FACT.

Retirements and Resignations

Consequent to Govt. of India, Ministry of Chemicals & Fertilizers, Department of Fertilizers Order No. 95/1/2019-HR PSU dated 29.09.2021, Ms. Alka Tiwari ceased to be the Government Nominee Director on the Board of the Company with effect from 29^th September, 2021.

The Board places on record its appreciation for the valuable services rendered by Ms. Alka Tiwari, Director. Reappointment of Independent Directors

During the financial year 2021-22, no Independent Director was reappointed on the Board of the Company as per section 149 (10) of the Companies Act 2013.

Disqualification of Directors

None of the Directors has incurred any disqualification as provided under section 164 of the Companies Act 2013. Annual Evaluation of Board.

FACT being a Government Company, all appointments on the Board is made by the Government of India, Ministry of Chemicals and Fertilizers, Department of Fertilizers. The performance of Directors are evaluated by the Ministry of Chemicals & Fertilizers, Department of Fertilizers, Government of India. As per Government of India, Ministry of Corporate Affairs notification dated 5^th June 2015, clause (e) and (p) of sub-section 3 of Section 134 of the Companies Act 2013 relating to appointment, remuneration and Annual evaluation of Board on its performance are not applicable to FACT.

However, suitable mechanism is being evolved for Annual Performance evaluation of Board as per SEBI (LODR) Regulation 2015.

Declaration of Independent Directors

The independent director made declaration of independence under sub-section (6) of Section 149 of Companies Act, 2013 during the financial year 2021 -22.

Meetings of the Board

During the financial year 2021-22, five (5) meetings of the Board were convened and held. The details of the meetings of the Board of Directors are given in the report on Corporate Governance, which is part of this report. The intervening gap between the meetings was within the limit prescribed under the Companies Act 2013.

Secretarial Standards

Your Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relating to âMeetings of the Board of Directorsâ and âGeneral Meetingsâ respectively, have been followed by the Company.

AUDITORS(1) Statutory Auditors and Statutory Auditorâs Report

M/s. K Venkatachalam Aiyer & Co., Chartered Accountants, Kochi, was re-appointed as Statutory Auditors of the Company for the financial year 2021 -22 by the Comptroller and Auditor General of India.

M/s Sundar & Ram, Chartered Accountants, Chennai, was appointed as Branch Auditors for the year 2021-22, for the Area / Regional Offices at Tamil Nadu and Kerala, by the Comptroller and Auditor General of India. M/s CKS Associates, Chartered Accountants, Hyderabad, was appointed as Branch Auditors for the year 2021-22 for the Area / Regional Offices at Andhra Pradesh, Telengana and Karnataka States by the Comptroller and Auditor General of India.

Report of the Statutory Auditors on the Financial Statements for the financial year 2021-22 is a qualified Report. Clarification of the management in respect of qualification in Auditorâs Report is given below.

AUDITORâS QUALIFICATION

MANAGEMENT REPLY

Regarding sale of land and conversion of leasehold to freehold land to the Company, even though the Government of Kerala (GoK) has accorded freehold right to the Company over 143.22 acres of land during the financial year 2019-20, the Company is yet to receive freehold title pending formalities. Accordingly, the fair value of the non-monetary asset of freehold title of the land converted as required under Ind AS 16-Property Plant and Equipment and the consequent applicability of other Ind ASs on the standalone financial statements have not been recognized by the Company. During the year, the Company has obtained a registered valuerâs report valuing the said property at D 47,956 lakhs in 2019. In the event of adopting the aforesaid value as fair value in the financial statements, the impact thereof would be increase in Property, Plant and Equipment and Other Equity to the tune of D 47,956 lakhs from the present values shown.

The procedure for conversion of leasehold land to freehold is not completed while finalizing the Financial Statements. The Cabinet decision of Govt. of Kerala on conversion of leasehold land to freehold was pending and the Company has not obtained title deed of the land. As per the revenue records, the land is in the name of Govt. of Kerala as âPuramboke landâ leased to FACT.In view of the above, even though the Company has ascertained fair value of the land the same has not been considered in the accounts.

(2) Cost Audit

As prescribed under section 148 of the Companies Act ,2013, read with the Companies (Cost Report and Audit) Rules 2014, cost accounting records are being maintained by the Company. M/s Rajendran, Mani & Varier, Cost Accountants, Kochi has been appointed as Cost Auditors of the Company for the year 2021-22. Cost Audit report for the financial year 2020-21 was filed with Ministry of Corporate Affairs on 08^th November, 2021.

(3) Secretarial Audit

M/s SVJS & Associates, Company Secretaries, Kochi, has been appointed as Secretarial Auditors of the Company for the year 2021-22. The report of the Secretarial Auditor is annexed to this report as Annexure-1. The Secretarial Auditor has made the following observations in their Secretarial Audit Report.

âDuring the financial year 01.04.2021 to 31.03.2022, fifty per cent of the Board of directors of the Company does not comprise of Independent Directors and non-executive directors. The Nomination Remuneration Committee comprises of executive directors as well. The Audit Committee, Stakeholder Relationship Committee and Nomination Remuneration Committee comprises of only one Independent Director. Further, the Company has not appointed women Independent Director. â

Explanation on observations made by Secretarial Auditors in their report is given below;

Being a Central PSU, the members on the Board of FACT are nominated by the Department of Fertilizers, Ministry of Chemicals & Fertilizers, Govt. of India. The Company will comply the provisions of regulations 17(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, once the notification on appointment of Independent Directors is issued by the Government of India.

Audit Committee

In line with the provisions of Section 177 of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 an Audit Committee of the Board has been constituted. Details of Members/ Meetings of the Audit Committee are elaborated in the report on Corporate Governance annexed here with. There were no instances in which the Board has not accepted any recommendation of the Audit Committee.

Public Deposit

During the financial year 2021-22, the Company has not accepted any deposit from public.

Investor Education and Protection Fund (IEPF)

During the year 2021-22 no amount is required to be transferred to Investor Education and Protection Fund and therefore FACT has not transferred any amount to Investor Education and Protection Fund. No amount is pending for transfer to IEPF.

Market Capitalization - Top 500 Companies

Based on Market Capitalization as on March 31,2022, your Company is one among the top 500 listed Companies. Contract or arrangement with related parties

Corporate Social Responsibility

FACT continued to give priority on various Social Responsibility measures during the financial year 2021-22. The Company has constituted a Board level Committee as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014. Annual Report on CSR as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed to this report as Annexure-2A.

Risk Management

Vigil Mechanism & Whistle Blower Policy

Code of Conduct

FACT is having a code of conduct known as FACT Code of business Conduct and Ethics applicable to the members of the Board and all senior executives of the Company. The code has been posted on the Companyâs website www.fact.co.in .

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and senior executives of the Company.

The Board members and Senior Executives of the Company have affirmed compliance of the code of Conduct for the financial year 2021-22.

Prevention of Insider Trading

No instances of insider trading have been reported on FACT shares till date. A Code of Conduct on Prohibition of Insider Trading is published in the website of the company, www.fact.co.in .

Particulars of Loan given, Investment made, Guarantees given and securities provided

Particulars of Investment made by the Company, are provided in the financial statement for the year 2021-22.

During the financial year 2021-22, FACT has not provided any loan/guarantee or made any investment within the purview of Section 186 of the Companies Act 2013.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Following are the summary of sexual harassment complaints received and disposed of during the period under review:

Number of complaints at the beginning of the year: 0 Number of complaints received during the year: 2

Number of complaints disposed of during the year: 0 Number of complaints at the end of the year: 2 Particulars of Employees

Vigilance

Vigilance Department in FACT is an integral part of the Management function. This department functions with the concept of âVigilance for Corporate Excellenceâ and works with a motto âcommitted to Institute and Internalize ethical practices in FACT.â Adopting an approach of proactive and preventive Vigilance, this Department strives to improve the quality management systems within FACT by creating a corruption free environment for each individual to strive for high level performance towards achieving the Vision and Mission of FACT.

The work profile of Vigilance Department includes investigation of complaints received from various sources, surprise inspections, regular surveillance/intelligence gathering, scrutiny of procurement/contract files, scrutiny of property returns of employees, coordination with CVC and other Government Departments.

During the financial year 2021-2022, the Company has observed Vigilance Awareness Week from 26^th October 2021 - 1^st November, 2021, in line with the decision of Central Vigilance Commission and conducted several programs to create vigilance awareness.

Integrity Pact

An integrity Pact in line with Government of India guidelines in this regard has been finalised and implemented in the company.

The Right to Information Act 2005

Extract of Annual Return

The Extract of Annual Return of the Company as provided under Sub section (3) of Section 92 of Companies Act, 2013, is published on the website of the Company, www.fact.co.in

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

Information regarding the conservation of energy, technology absorption, and foreign exchange earnings and-outgo as required to be disclosed in terms of the Companies (Accounts) rules 2014 is set out in a separate statement attached to this report.

Dividend Distribution Policy

In terms of the Regulation 43A of SEBI (LODR) Regulations, 2015, the Board of Directors of your Company have adopted Dividend Distribution Policy. The Policy is available on the website of the Company, www.fact.co.in.

Directorâs Responsibility Statement

Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors hereby state that:

(a) in the preparation of annual accounts for the year ended March 31,2022, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2022 and of profit and loss statement for the year ended March 31,2022.

(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 were operating effectively; and

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

General

The Board of 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.

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the company under any scheme.

4. The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

5. Neither the Managing Director nor the whole time Directors of the Company receive any remuneration or commission from its Associate Company.

6. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.

7. No fraud has been reported by the auditors to the Audit Committee or to the Board.

Acknowledgement

Your Directors gratefully acknowledge the valuable guidance and support extended by Honâble Minister of Chemicals and Fertilisers, Honâble Minister of State for Chemicals and Fertilisers, Honâble Chief Minister of Kerala, the Secretary, Ministry of Chemicals and Fertilisers and other officials of the Ministry of Chemicals and Fertilisers as well as other Ministries of the Government of India, Department of Public Enterprises and the State Governments of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Bihar, Odisha, Maharashtra, West Bengal and Union Territory of Puducherry.

The Directors also acknowledge the continued support extended by the Shareholders, Dealers, Suppliers, Bankers, Valued Customers and Auditors of the Company, the Press and Electronic Media.

For and on behalf of the Board of Directors.

(Kishor Rungta) Chairman and Managing Director DIN-00231106

Place : Udyogamandal Date : 17-08-2022

Mar 31, 2018

Dear Members,

The Directors are pleased to present the 74th Annual Report and Audited Financial Statements of the Company and the report of the Auditors for the financial year ended March 31, 2018.

Your Directors are happy to inform you that your company is presenting the financial statements for the financial year 2017-18, as per the provisions of Ind As for the first time.

During the financial year 2017-18, the financial, production and marketing performance of your company has improved considerably as compared to previous year.

The companyâs Financial Performance for the year ended March 31, 2018 is summarized below:

Rs. in crores

Particulars	2017-18	2016-2017
Net Sales	1928.67	1883.27
Other Income	41.35	18.04
Total Revenue	1970.02	1901.31
Total Expenses	2100.53	2163.99
Earnings before interest, depreciation and Taxes (EBIDTA)	208.05	63.28
Interest	321.42	304.66
Depreciation	17.15	21.30
Profit before tax	(-)130.51	(-)262.68
Total comprehensive Income	2.69	27.95
Profit after tax(PAT) after Comprehensive income	(-)127.82	(-)234.73

Due to accumulated loss, your directors have not recommended any dividend for the financial year 2017-18. The Company has not transferred any amount to Reserve during the financial year 2017-18.

Total revenue of the Company for the year 2017-18 was Rs.1970.02 crore against the previous year of Rs.1901.31 crore. The financial results of the Company for the year 2017-18 shows a net loss of Rs.127.82 crore as compared to a loss of Rs.234.73 crore during the year 2016-17.

Huge interest on Government of India Loan, restriction in production due to poor lifting of fertilizers on account of failure of South West monsoon are the major reasons for the negative financial results of the company for the year 2017-18.

PRODUCTION & SALES

Production		(in MT)
	2017-2018	2016-2017
Factamfos 20 : 20	670915	640322
Ammonium Sulphate	180178	152953
Caprolactam	0	770

Sales		(in MT)
	2017-2018	2016-2017
Fertilisers	867370	763232
Caprolactam	0	770

The company was able to maintain the momentum in production and marketing during the financial year 2017-18.

Despite the failure of South West monsoon, the Company could significantly improve the production and marketing performance during the year 2017-18 compared to previous year. Factamfos production for the year 2017-18 was 670915 MT in comparison with 640322 MT for the year 2016-17, showing a remarkable improvement of 30593 MT.

In the case of Ammonium Sulphate, the production was 1,80,178 MT against the previous year of 1,52,953 MT, with an increase of 27,225 MT registering a growth of 17.8% during the year. The production of Ammonium Sulphate is highest in past seven years.

Total fertilizer sales for the year 2017-18 is 8.67 lakh MT as against 7.63 lakh MT for the year 2016-17 registering a growth of 13.63% during the year. This is the highest annual sales in the last four years.

During the year 2017-18 FACT Engineering Works (FEW) has commissioned a barge for transportation of Ammonia and the same is operating successfully.

During the ensuing financial year 2018-19 the company is planning to optimise the production and sale of fertilisers. An ambitious sales plan is envisaged with a sale of more than 1 Million MT of fertilisers. The company envisage a 30% increase from average sale of past five years, recapturing the potential markets of Telengana and North Karnataka. The company is also planning to re-start the Caprolactam Operations in a phased manner, depending on economics.

The Company is envisaging to make use of RLNG in manufacturing of Ammonia, the essential raw material of fertilisers to enhance the production in ensuing financial year 2018-19.

However, the break down in Sulphuric Acid Plant at Udyogamandal Division in April 2018 had affected the production of Ammonium Sulphate. The company is trying to reduce the impact on production by outsourcing sulphuric acid. The company is also planning to import fertilisers to reduce the impact on production loss due to break down of acid plant.

The financial restructuring package submitted by the Company for sustainable operation in the long run is under the consideration of Department of Fertilisers, Government of India.

With the approval of Government of India, on 10-05-2018 Sale deed for sale of 150.899 acres of land to BPCL was executed and an amount of Rs.244.60 Crore was received by the company, after deducting the outstanding amount of Rs 161.59 crore to BPCL towards the supply of Naphtha and Furnace Oil.

Management Discussion and Analysis Report

Management Discussion and Analysis Report covering the operational aspects for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015(as amended) is presented in a separate section forming part of Directorsâ Report. Consolidated Financial Statements

The Consolidated Financial Statements of the Company for the financial year ended March 31, 2018, prepared in accordance with Section 129(3) of the Companies Act 2013 and relevant accounting standards form part of the Annual Report.

Directors and Key Managerial Personnel Appointments

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No.86/5/2008-HR-1 dated 21st February, 2018 entrusted the additional charge of the post of CMD, FACT to Shri Manoj Mishra, Chairman and Managing Director, National Fertilisers Ltd. (NFL). Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No.86/1/2012-HR-1 dated 13th September, 2017, appointed Shri D Nandakumar, Ex- Chief General Manager FACT to the post of Director (Marketing), FACT.

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No.86/1/2017-HR-1 dated 10th August, 2017, entrusted the additional charge of the post of Director (Technical), FACT to Shri U Saravanan, Director (Technical) Madras Fertilisers Ltd (MFL) Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No.88/1/2014-HR-1 dated 05th March, 2018, entrusted the additional charge of the post of Director (Finance), FACT to Shri Sanjai Maheshwari, Director (Finance) Brahmaputra Valley Fertilizer Corporation Limited (BVFCL).

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers vide Order No. 130/8/2003-HR-1 dated 10th April 2018 notified the appointment of Ms Gurveen Sidhu, Joint Secretary, Department of Fertilizers, Ministry of Chemicals & Fertilizers, Government of India as a part time Government Nominee Director on the Board of FACT in place of Shri S K Lohani.

Government of India, Ministry of Chemicals & Fertilisers, Department of Fertilisers, vide Order No.86/01/2016-HR-1 dated 28th April, 2017 entrusted the additional charge of the post of Director (Finance), FACT to Shri Suresh Warior, Director (Finance), Rashtriya Chemicals and Fertilisers Ltd.

Shri Manoj Mishra, C&MD, Shri D Nandakumar, Director Marketing and Shri K.V. Balakrishnan, Company Secretary are the Key Managerial personnel of the company.

Retirements and Resignations

On completion of tenure in Department of Fertilisers, Shri S K Lohani ceased to be the C&MD of the Company with effect from 15.02.2018. Consequent to the superannuation from Rashtriya Chemicals and Fertilisers Limited Shri Suresh Warior ceased to be the Director (Finance) FACT with effect from 1st December 2017.

Reappointment and Appointment of Directors at the Annual General Meeting

Pursuant to the provisions section 152 of the Companies Act 2013 Ms Alka Tiwari, Government nominee Director will retire by rotation at the ensuing AGM and being eligible has offered herself for reappointment.

Notice has been received under section 160 of the Companies Act 2013 for appointment of Ms Gurveen Sidhu, Joint secretary ,Department of Fertilisers as Director at the ensuing annual general meeting.

I Brief resume of Directors are given in Report on Corporate Governance .

Reappointment of Independent Directors

As per section 149 (10) of the Companies Act 2013, none of the Independent Directors has been reappointed on the Board of the Company. Disqualification of Directors

None of the Directors has committed any disqualification as provided under section 164 of the Companies Act 2013.

Annual Evaluation of Board.

FACT being a Government Company, all appointments on the Board is made by the Government of India, Ministry of Chemicals and Fertilizers, Department of Fertilizers. The performance of Directors are evaluated by the Ministry of Chemicals & Fertilizers, Department of Fertilizers, Government of India. As per Government of India, Ministry of Corporate Affairs notification dated 5th June 2015, clause (e) and (p) of sub-section 3 of Section 134 of the Companies Act 2013 relating to appointment, remuneration and Annual evaluation of Board on its performance are not applicable to FACT.

However, suitable mechanism is being evolved for Annual Performance evaluation of Board as per SEBI (LODR) Regulation 2015.

Declaration of Independent Directors

All independent directors have made a declaration of independence under sub-section (6) of Section 149 of Companies Act, 2013.

Meetings of the Board

During the financial year 2017-18, seven meetings of the Board were convened and held. The details of the meetings of the Board of Directors are given in the report on Corporate Governance, which is part of this report. The intervening gap between the meetings was within the limit prescribed under the Companies Act 2013.

Secretarial Standards

Corporate Governance

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Board lays emphasis on transparency and accountability for the benefit of all stake-holders of the Company. The Report on Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 annexed to this report forms an integral part of this report.

AUDITORS

(1) Statutory Auditors and Statutory Auditorâs Report

M/s. Babu A Kallivayalil & Co., Chartered Accountants, Kochi, was appointed as Statutory Auditors of the Company for the year 2017-18 by the Comptroller and Auditor General of India. M/s Narotham Madhav & Ramesh, Chartered Accountants, Hyderabad, was reappointed as Branch Auditors for the year 2017-18 for the Area / Regional Offices at Andhra Pradesh, Telengana and Karnataka States. M/s Siv Ram & Raj, Chartered Accountants, Chennai, was appointed as Branch Auditors for the year 2017-18, for the Area / Regional Offices at Tamil Nadu and Kerala, by the Comptroller and Auditor General of India.

The Statutory Auditors have submitted their unmodified report on the financial statements of the company for the year ended 31 st March, 2018. In the said report there is no qualification on the annual financial statements of the Company.

(2) Cost Auditors

As prescribed under section 148 of the Companies Act ,2013, read with the Companies (Cost report and Audit ) Rules 2014, the cost accounting records are being maintained by the Company. M/s BBS & Associates, Cost Accountants, Kochi has been reappointed as Cost Auditors of the Company for the year 2017-18. Cost Audit report for the financial year 2016-17 was filed with Ministry of Corporate Affairs (MCA) on 18.09.2017.

(3) Secretarial Audit

M/s SVJS & Associates, Company Secretaries, Kochi, have been appointed as Secretarial Auditors of the Company for the year 2017-18. The report of the Secretarial Auditor is annexed to this report as Annexure-1.

Comments of C & AG

Comptroller and Auditor General of India (C&AG) has conducted a supplementary audit under section 143(6) of the Companies Act 2013 on the financial statements including consolidated financial statement of the Company for the financial year 2017-18. C&AG has not given any comment on the financial statements of the Company.

Audit Committee

In line with the provision of Section 177 of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 an Audit Committee of the Board has been constituted. Details of Members/ Meetings of the Audit Committee are elaborated in the report on Corporate Governance annexed here with. There were no instances in which the Board had not accepted any recommendation of the Audit Committee. Associate Company

FACT-RCF Building Products Limited (FRBL) and Kerala Enviro Infrastructure Ltd. are the associate companies of FACT. During the financial year, no Company has become/ceased to become subsidiaries/Joint Ventures and Associate Company of FACT. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the associate companies and joint ventures in Form AOC1 is provided as part of the Annual Report.

Report on financial position and Performance of Joint Venture

During the financial year 2017-18, the financial results of FRBL show a net loss of Rs.14.84 crore, as per provisional accounts considered for consolidation. Due to the accumulated loss, the entire networth of FRBL has been eroded. The Company has created provisions for the entire Jnvestment made in FRBL.

The financial results of Kerala Enviro Infrastructure Ltd. for the financial year 2017-18 shows a profit of Rs.2.46 Crore.

Public Deposit

During the financial year 2017-18, the Company has not accepted any deposit from public.

Investor Education and Protection Fund (IEPF)

During the year 2017-18 FACT has transferred an amount of Rs 6484/- to Investor Education and protection Fund. As on date no amount is pending for transfer to IEPF.

Contract or arrangement with related parties

The transactions entered with related parties for the year under review were on arms length basis and in the ordinary course of business. The disclosure in form No AOC-2 for the transactions with related parties during the period under review is enclosed as Annexure -2.

Corporate Social Responsibility

FACT continues to give priority on various Social Responsibility measures during the financial year 2017-18. The Company has constituted a Board level Committee as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014. Annual Report on CSR as per the provisions of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed to this report as Annexure-2A.

Material changes and commitments

There were no material changes and commitments affecting the financial position of the company between the end of financial year (31 st March 2018) and the date of the report. Similarly, there was no change in the nature of business of the company during the financial year 2017-18. Risk Management FACT has formulated a risk management policy for identification of potential area of risk and mitigation of the same. FACT is having adequate risk management infrastructure in place capable of addressing all potential risks.

Internal Financial Control

FACT is having an Internal Control System, commensurate with the size, scale and complexity of its operations. The Internal Audit wing of FACT headed by Deputy General Manager monitors and evaluate the efficacy and adequacy of Internal Control System in the Company. The observation of internal audit and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. Based on the recommendation of Internal Audit, the functional heads take necessary corrective actions in their functional area thereby strengthen internal control.

Vigil Mechanism & Whistle Blower Policy

FACT is having a vigil mechanism for directors and employees to report their concerns. The Directors and employees can approach Chairman Audit Committee of the Board directly and report their concern in appropriate case. The vigil mechanism and whistle blower policy is published in the web site of the Company www.fact.co.in.

Code of Conduct

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and senior executives of the Company. Senior management personnel have confirmed compliance of the code of conduct.

The Board members and Senior Executives of the Company have affirmed compliance of the code of Conduct for the financial year 2017-18. Prevention of Insider Trading

No instances of insider trading have been reported on FACT shares till date. A code of conduct for prevention of insider trading and code for corporate disclosure is published in the website of the company, www.fact.co.in.

Particulars of Loan given, Investment made, Guarantees given and securities provided

Particulars of Investment made and guarantees given along with the purpose for which the guarantee is given are provided in the financial statement for the year 2017-18.

During the financial year 2017-18, FACT has not provided any loan/guarantee or made any investment within the purview of Section 186 of the Companeis Act 2013.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.

The following is the summary of sexual harassment complaints received and disposed off during the period under review:

No. of complaints at the beginning of the year : Nil

No. of complaints received during the year : Nil

No. of complaints disposed off during the year : Nil

No. of complaints at the end of the year : Nil

Particulars of Employees

During the year under review, none of the employees of the Company had drawn remuneration in excess of the limit prescribed under section 134 â) (3)( c) of the Companies Act 2013 read with Companies (Appointment of Managerial personnel) Rules 2014.

Integrity Pact

FACT is in the process of finalising the integrity pact in line with Government of India guide lines in this regard The Right to Information Act 2005

Extract of Annual Return

The Extract of Annual Return of the Company as provided under Sub section (3) of Section 92 of Companies Act, 2013, in Form MGT9 is annexed as Annexure-3.

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

Directorâs Responsibility Statement

Pursuant to Sec.134(3)(c) of the Companies Act, 2013, your Directors hereby state that :

(a) in the preparation of annual accounts for the year ended March 31, 2018, the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of profit and loss statement for the year ended March 31, 2018.