DIRECTOR'S REPORT

Dear Members,

The Board of Directors of your Company are pleased to present the the 16th (Sixteenth) Annual Report on the business and operations of the Company italicizing the progress and growth achieved during the year along with Audited Financial Statements with Auditors' Report thereon, Secretarial Auditor's Report for the Financial Year ended 31st March, 2023.

FINANCIAL RESULTS:

The Company's financial performance for the year ended March 31, 2023 is summarized below:

RESULTS OF OPERATIONS & STATE OF COMPANY'S AFFAIRS

The Company recorded a turnover of Rs. 4375.66 during the year as against Rs. 2444.47 in the previous year and the Company has earned a profit after tax of Rs. 251.91 as compared to the profit of Rs. 12.01 in the previous financial year. The management of the Company is putting their best efforts to improve the performance of the Company.

During the year the Company has performed modestly but despite of challenging economic conditions and other related factors, we are able to maintain profits and steady revenue in the Company. The Directors are relentlessly striving for betterment of the business and growth of the Company. They are optimistic about the future and expect the business to perform well in the forthcoming year.

CHANGE IN THE NATURE OF BUSINESS

There have been no changes in the nature of business of the Company during the Financial Year SHARE CAPITAL

• Authorized Share Capital

During the Financial Year 2022-23, there had no changes in the Authorized Share Capital of the Company. The Authorized Share Capital of the Company is Rs. 10,20,00,000 divided into 10,200,000 Equity Shares of Rs. 10/- each.

• Paid up Share Capital

The paid-up equity share capital as on March 31, 2023 stood at Rs. 10,13,89,160 divided into 10,13,89,16 equity shares of Rs. 10/- each. There was no change in the paid-up share capital during the year under review.

DIVIDEND

Board have considered it financially prudent in the long-term interest of the Company to reinvest the profits into the business of the Company to build a strong reserve base and grow the business of the Company. Therefore, Board of Directors has not recommended any dividend for the financial year ended on 31st March, 2023.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid as on 31st March 2023.

TRANSFER TO RESERVES

During the period, the Company has not transferred any profit into the General Reserve of the Company.

DEPOSIT

During the year, the Company has neither accepted any deposits from the public, nor does it have any scheme to invite any such deposits.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS MADE U/S 186 OF THE COMPANIES ACT, 2013

The particulars of loans given or guarantees given or investments made or securities provided are given in notes to financial statements.

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

Conservation of energy: Not applicable Technology absorption: Not applicable

Foreign exchange earnings and outgo: There was no foreign exchange inflow or Outflow during the year.

CORPORATE SOCIAL RESPONSIBILITY

As per the provisions of Section 135 of the Companies Act, 2013 read with rules framed thereunder, certain class of companies is required to spend 2% of its average net profit during 3 preceding years on CSR activities. It also provides for formation of CSR committee of the Board. The rules prescribe the activities qualify under CSR and the manner of spending the amount. The Company is not covered under section 135 of the Companies Act, 2013 and the rules framed there under for the financial year under review, so there are no disclosures required under Section134 (3](o] of the Companies Act, 2013.

Migration from BSE SME Platform to Main Board of NSE in addition to Main Board of BSE

Your Company was listed on the SME platform of BSE Limited (BSE] since 15th February, 2018. After completion of 5 years of listing and trading on the BSE SME Platform With a view to acknowledge publically on a large level and for the enhanced recognition, the Company has been migrated from BSE SME Platform to Main Board of NSE in addition to Main Board of BSE on 10th day of April, 2023. Listing on the Main Board of BSE and NSE take the Company into a different league altogether with enhanced recognition and increased participation by retail investors. Migration to the main board acts as a catalyst in the growth and expansion of the Company and also help the shareholders of the Company to enjoy enhanced returns from their investments.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint Venture or Associate Company; hence provisions of Section 129(3] of the Companies Act, 2013 relating to preparation of consolidated financial statements are not applicable.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE: -

During the year under review there has been not any such significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

PARTICULARS OF EMPLOYEES U/S 197(12) OF THE COMPANIES ACT. 2013

The Information & Statement of Particulars of employees pursuant to Section 197 of the Companies Act, 2013 and Rule 5 (1) & 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure I.

Appointment/ Re-appointment/Resignation:

During the financial year under review Mr. Ajay (DIN: 08556054) appointed as Additional and Non-Executive Independent Director on the Board of the Company w.e.f March 02, 2023 subject to the approval of the members in the next General Meeting of the Company or within 3 months from the date of appointment. Further the approval of members taken/obtained on May 22, 2023 through the postal ballot

In accordance with provisions of the Act and the Articles of Association of the Company, Mr. Rajat Sehgal, (DIN: 05281112), Executive Director retires by rotation at the ensuing AGM and being eligible offers himself for re-appointment.

Independent Director:

In terms of Section 149 of the Act and SEBI Listing Regulations, Mr. Mohan Chahuan (DIN: 08627458), Mr. Yogesh Kumar (DIN: 08722626) and Mr. Mr. Ajay (DIN: 08556054) are the Independent Directors of the Company as on date of this report.

All Independent Directors of the Company have given requisite declarations under Section 149(7) of the Act, that they meet the criteria of independence as laid down under Section 149(6) of the Act along with Rules framed thereunder, Regulation 16(1)(b) of SEBI Listing Regulations and have complied with the Code of Conduct of the Company as applicable to the Board of directors and Senior Managers. In terms of Regulation 25(8) of the SEBI Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence.

All the independent directors have submitted a declaration of independence, stating that they meet the criteria of independence provided under section 149(6) of the Act read with regulation 16 of the SEBI Listing Regulations, as amended and also received confirmation from all the Independent Directors of their registration on the Independent Directors Database maintained by the Indian Institute of Corporate Affairs, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.

In the opinion of the Board, the Independent Directors possess the requisite expertise and experience and are persons of high integrity and repute. They fulfill the conditions specified in the Act as well as the Rules made thereunder and are independent of the management.

Key Managerial Personnel:

Ms. Monika Joshi resigned from the post of Company Secretary and Compliance officer with effect from April 04, 2022

Ms. Shivani Sharma appointed as Company Secretary & Compliance Officer of the Company on the recommendation of the Nomination and Remuneration Committee with effect from May 14, 2022.

NUMBER OF MEETINGS OF THE BOARD:

During the year the Board meet 8 times to deliberate on various matters on 04/04/2022, 30/04/2022, 14/05/2022, 26/05/2022, 24/08/2022, 17/010/2022, and 12/01/2023 and 02/03/2023. For more details, please refer to the Report on Corporate Governance, which forms an integral part of this Annual Report.

COMMITTEES OF THE BOARD:

The Board committees play a crucial role in the governance structure of the Company and have been constituted to deal with specific areas/ activities which concern the Company and need a closer review. The Board committees are set up under the formal approval of the Board, to carry out clearly defined roles which are considered to be performed by the members of the Board, as a part of good governance practice.

All decisions and recommendations of the committees are placed before the Board for information or for approval. The minutes of the meetings of all the committees are placed before the Board for their review.

The Board of Lorenzini Apparels Limited currently has 3(Three) Committees:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholder's Relationship Committee

Details of composition, terms of reference and number of meetings held for respective committees are given in the Report on Corporate Governance, which forms a part of this Annual Report. Further, during the year under review, all recommendations made by the various committees have been accepted by the Board.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAIL:

The Company's Policy on Directors' appointment and remuneration and other matters provided in Section 178 (3) of the Act has been briefly disclosed hereunder and in the Report on Corporate Governance, which is part of this Annual Report.

The NRC is responsible for developing competency requirements for the Board based on the industry and strategy of the Company. The Board composition analysis reflects in-depth understanding of the Company, including its strategies, environment, operations, financial condition and compliance requirements.

In terms of the provisions of Section 178(3] of the Act, and Regulation 19 of the SEBI Listing Regulations, the NRC has formulated the criteria for determining qualifications, positive attributes and independence of Directors, the key features of which are as follows:

Qualifications - The Board nomination process encourages diversity of thought, experience, knowledge, age and gender. It also ensures that the Board has an appropriate blend of functional and industry expertise.

4- Positive Attributes - Apart from the duties of Directors as prescribed in the Act, the Directors are expected to demonstrate high standards of ethical behaviour, communication skills and independent judgment. The Directors are also expected to abide by the respective Code of Conduct as applicable to them

The Directors affirm that the remuneration paid to Directors, Key Managerial Personnel and employees is as per the Remuneration Policy of the Company.

The said Policy is also available on the website of the Company at https://monteil.in/wp- content/uploads/2023/01 /Policies/NOMINATION AND REMUNERATION POLICY.pdf

Mechanism of Performance Evaluation of the Board, Committees and Individual Directors

Your Company believes that the process of performance evaluation at the Board level is pivotal to its Board engagement and effectiveness. The Nomination and Remuneration Policy of the Company empowers the Board to formulate a process for effective evaluation of the performance of individual directors, Committees of the Board and the Board as a whole pursuant to the provisions of the Act and Regulation 17 and Part D of Schedule II to the Listing Regulations.

The Board has carried out the annual performance evaluation of its own performance, Committees of the Board and each Director individually. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specified duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The Independent Directors of the Company met on March 31, 2023, without the presence of Non-Independent Directors and members of the management to review the performance of Non-Independent Directors and the Board of Directors as a whole; review the performance of the Chairman and Managing Director of the Company and to assess the quality, quantity and timeliness of flow of information between the management and the Board of Directors. The performance evaluation of the Independent Directors was carried out by the entire Board. The Directors expressed their satisfaction with the evaluation process.

Dedicated time was reserved for Board feedback on the agenda. Board interaction between meetings was stepped up through calls with individual Directors on various topics. Specific items were also added in the Board agenda from a governance perspective.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

All contracts/arrangements/transactions entered by the Company with related parties are at arm's length basis. The details of the related party transactions are set out in Notes to the Financial Statements of the Company and form AOC - 2 pursuant to Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts] Rules, 2014 is set out in Annexure-II.

The policy on Related Party Transactions, as approved by the Board, may be accessed on the Company's website at the link: https://monteil.in/wp-content/uploads/2023/01/Policies/Related Party Transaction Policy.pdf

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5] of the Act, the Board of Directors, to the best of their knowledge and ability, confirms that:

In the preparation of the Annual Accounts for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the Profit of the Company for the year ended on that date;

The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

The annual accounts have been prepared on a going concern basis;

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

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.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

As per the provisions of Companies Act, 2013, every Listed Company shall establish a vigil mechanism (Similar to Whistle Blower mechanism]. In pursuance of the provisions of section 177(9] & (10] of the Companies Act, 2013, a vigil mechanism/ whistle blower policy for

Directors and employees to report genuine concerns has been established and approved by Board.

The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, integrity and ethical behaviour.

The Vigil Mechanism - cum - Whistle Blower Policy may be accessed on the Company's website at the link: https://monteil.in/wp-content/uploads/2023/01/Policies/Whistle Blower Policy.pdf

The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairperson of the Audit Committee of the Company for redressal. No person has been denied access to the Chairperson of the Audit Committee. During the financial year 2022-23, no cases under this mechanism were reported to the Company.

SECRETARIAL STANDARDS'

During the year under review the Company has complied with Secretarial Standards on Board and General Meetings issued by Institute of Company Secretaries of India

CORPORATE GOVERNANCE

Pursuant to Regulation 34 of the SEBI Listing Regulations, Report on Corporate Governance along with the certificate from a Practicing Company Secretary certifying compliance with conditions of Corporate Governance is part to this Report in Annexure-III.

AUDITORS & AUDITORS' REPORT

l STATUTORY AUDITOR

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Rules made thereunder, the statutory auditors of the Company, M/s Mittal & Associates, Chartered Accountants (Firm Registration Number: 106456W] was appointed by the members at the 11th Annual General Meeting to hold office until the conclusion of ensuing Annual General Meeting, The notes on accounts referred to in the auditors' report are self-explanatory and therefore don't call for any further comments by the Board of Directors. M/s Mittal & Associates, Chartered Accountants tenure of 5 (five] year as Statutory Auditors concludes at this ensuing AGM.

The Company has received confirmation from the Statutory Auditors to the effect that their appointment, if made, will be in accordance with the limits specified under the Act and the firm satisfies the criteria specified in Section 141 of the Act read with Rule 4 of the Companies (Audit and Auditors] Rules, 2014.

The Board of Directors of the Company on the recommendation of the Audit Committee has reappointed M/s Mittal & Associates, Chartered Accountants as the Statutory Auditors of the Company pursuant to Section 139 of the Act for a second term 5 (five] years to hold office from the conclusion of the ensuing AGM till the conclusion of 21st AGM of the Company to be held in the year 2027, subject to approval by the Members at the ensuing AGM.

The Board recommends to seek consent of its Members at the ensuing AGM on re-appointment of M/s Mittal & Associates, Chartered Accountants as Statutory Auditors for tenure of 5 (five] years, to examine and audit the accounts of the Company during the said period.

There are no qualifications or adverse remarks in the Auditors' Report which require any clarification or explanation.

• Internal Auditor

Pursuant to Section 138 of the Act and Rules made there under, M/s Burhan & Associates, Chartered Accountants (FRN: 036633N] having its head Office at TA-176, 1st Floor, Gali No. 3 Tughlakabad Extn, Kalkaji, South Delhi-110019 were appointed as Internal Auditors for the financial year 2022-23.

• Secretarial Auditor

Pursuant to Section 204 of the Act and Rules made there under, the Board of Directors of the Company had appointed M/s Pawan Mahur & Associates (Registration No. P2012DE081400] Practicing Company Secretary having its Registered Office at 611 6th Floor, Rajendra Place, New Delhi-110008 to conduct Secretarial Audit of the Company for the financial year 2020-21.

The Report of the Secretarial Audit is annexed herewith as Annexure -IV.

• Cost Audit

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1] of the Act are not applicable for the business activities carried out by the Company.

CODE OF CONDUCT AND ETHICS

The Board of Directors of the Company has adopted a Code of Conduct and Ethics for the Directors and Senior Executives of the Company. The object of the Code is to conduct the Company's business ethically and with responsibility, integrity, fairness, transparency and honesty. The Code sets out a broad policy for one's conduct in dealing with the Company, fellow Directors and with the environment in which the Company operates.

LISTING WITH STOCK EXCHANGES

The Company During the FY 2022-2023, listed on SME platform of BSE Limited. Further, Company has migrated on main board of BSE Limited and National Stock Exchange of India Limited with effect from 10th April, 2023.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements] Regulations, 2015 ("Listing Regulations"] the Management

Discussion and Analysis of the financial condition and result of operations of the Company for the year under review is presented in a separate section forming part of the Annual Report as Annexure-V.

RISK MANAGEMENT

The Company is taking every care for minimizing the risk involved in the manufacturing process of the unit. Responsible staff employed to take every care to minimize the risk factor in the factory. The risk management policy of the company can be accessed at company website i.e, ttps://monteil.in/wpcontent/uploads/2023/01/Policies/RISK MANAGEMENT POLICY.p df

INTERNAL FINANCIAL CONTROL SYSTEM

According to Section 134(5] (e] of the Companies Act, 2013, the term financial control (IFC] means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of business, including adherence to the Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information.

The Company has a well-placed, proper and adequate Internal Financial Control System which ensures that all the assets are safeguarded and protected and the transactions are authorized, recorded and reported correctly.

To further strengthen the internal control process, the Company has developed the very comprehensive compliance management tool to drill down the responsibility of the compliance from top management to executive.

INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION. PROHIBITION & REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and our holding Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal] Act, 2013 and the rules framed there under. Internal Complaints Committee (ICC] has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees] of the Company are also covered under the said policy. During the financial year ended March 31, 2023, the Company has not received any Complaints pertaining to Sexual Harassment.

ANNUAL RETURN

Pursuant to Section 134(3)(a) and Section 92(3] of the Act read with Companies (Management and Administration] Rules, 2014, the draft Annual Return of the Company in Form MGT-7 for FY 2022-23 has been placed on the Company's website.

GENERAL

Your directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these items during the year under review:

• There are no significant material orders passed by the Regulators or Courts or Tribunal, which would impact the going concern status of the Company and its future operation

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

• There has been no application made or pending under Insolvency and Bankruptcy Code, 2016

• As per rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014, during the period under review, your Company has not issued Sweat equity shares.

• As per rule 12 (9) of Companies (Share Capital and Debentures) Rules, 2014, during the period under review, your Company has not issued equity shares under the scheme of employee stock option.

• As per rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 there are no voting rights exercised directly or indirectly by the employees in respect of shares held by them.

ACKNOWLEDGEMENT

Your Directors thank the Government of India, the State Governments, local municipal corporations and various regulatory authorities for their co-operation and support to facilitate ease in doing business.

Your Directors also wish to thank its customers, business associates, distributors, channel partners, suppliers, investors and bankers for their continued support and faith reposed in the Company.

Your Directors wish to place on record deep appreciation, for the contribution made by the employees at all levels for their hard work, commitment and dedication towards the Company. Their enthusiasm and untiring efforts have enabled the Company to scale new heights.