The Board of Directors has the pleasure in presenting its 61^st Annual Report along with the Audited Accounts for the year
ended March 31,2025.

Performance Review

The Indian Paper Industry faced significant challenges during the financial year 2024-25, primarily due to a surge in
imports, rising raw material costs and softening realizations. Amidst these challenges, your company showed resilience
and posted moderate profitability. The summary of the financial results are as follows:

Summary of Financial Results (D in Crores)

The total income declined by 14% during FY 2024-25
mainly on account of (i) A significant drop in domestic sales
realizations, driven by intense competition from cheaper
imports, particularly from China and ASEAN countries.

(ii) increase in raw material costs by 8.95%, driven by a
substantial 34% surge in domestic wood prices (a key
input), led to increased reliance on imported wood chips.

(iii) Increase in finance cost for capital expenditure including
Tissue paper project. (iv) Disruption in operations caused
by a workmen strike lasting for 28 days, planned annual
maintenance shutdown of 22 days and an increase in total
expenses by 5%. However, fixed cost savings provided
some offset to the overall impact. The total production
during the year was 2,32,861 MT, a decline of 1% over
the previous year and the total sales was 2,26,288 MT a
decline of 3% over the previous year largely attributable to
the workmen strike, annual outage and subdued market
demand. The management has taken considerable efforts
in this regard and the industrial relations have significantly
improved since then fostering a positive sentiment across
the Manufacturing facilities.

Despite pressures on revenues and operating profits in
FY2025, the company maintained moderate financial
stability. This resilience is attributed to a strong market
position, the ability to adapt its product mix to customer
preferences, and a robust dealership network that allows

flexible pivoting between domestic and export markets
based on demand.

The company implemented targeted strategies to
improve margins through prudent expense and inventory
management, tighter budgetary controls, operational
efficiency, process optimization and automation.
Furthermore, the company has sufficient wood inventory
thanks to strong farm forestry initiatives, with wood prices
expected to soften in the latter half of the year. Significant
capital investments in manufacturing facilities during the
year are anticipated to enhance production capacity and
operational efficiency, leading to recovery in profitability and
positive long-term returns for shareholders.

There was no change in the nature of business
during the year.

Transfer to reserves

The Company does not propose to transfer any amount
to reserves.

Sub division of Equity Shares

The Company after obtaining approval of the members of the
Company and Regulatory and other approvals sub-divided
the face value of the each of the Equity Share from C10/- to
?2/-. The Company has obtained new ISIN: INE435A01051

from depositories for new face value of the equity shares
and the trading with the new face value was commenced
on both BSE Limited and National Stock Exchange of India
Limited effective September 11,2024.

Dividend

The Board of Directors at their Meeting held on May 8,
2025 recommended a dividend of C1/- per equity share
of C2/- each, for approval of the Shareholders at the
forthcoming Annual General Meeting, and is incompliance
with the Dividend Distribution Policy of the Company.
The said Policy is disclosed on the Company's website:
https://andhrapaper.com/wp-content/themes/andhra_
paper/uploads/investors/1645517957Dividend%20
Distribution%20Policy.pdf.

Markets, Customers and Commercial Excellence

The Company sustains its core belief in “Customer First”
and its endeavour to create value for the customers,
“Serving you with Pride”.

The Customers choose Company's products for quality
applications of Printing, Publishing and Converting. Despite
significant market uncertainties, the capex incurred in
upgradation of plant and machinery ensured that the
Company was able to use its inherit strength of product mix
flexibility across machines to meet the changing Customer
preferences both in Writing & Printing and Value Added
application products. This resulted incremental YOY Sales
of Truprint Ultra (39%), Truprint Ivory (20%), Pharma Print
(13%), Stiffener (41%) and Cupstock Bottom (75%).

The Capex incurred during the year has ramped up
manufacturing facilities and capacity utilisation which
has increased the operational efficiency, optimisation
of processes which in turn ensure that your Company is
focused on delivering high-quality products thereby creating
a colossal distinguish from the competition offering products
up the value chain to the Customers. Apart from improving
existing Critical to Quality parameters of existing product
offering, continuous endeavour is done to develop new
products based on feedback from customers and channel
partners to make our products suit the changing end
application requirements.

Additional capacity will generate surplus pulp, which will
improve profitability. Adequate wood inventory has reduced
the dependency on wood imports. Prudent treasury and
working capital management, new vendor management
system will improve margins. Planned delivery schedules
helped overcome volatile trade flows.

The Company's fundamental value of “Think Customer”
continues to produce desired outcomes to augment
customer value by way of offering 'right products for right

applications' at an amplified speed to meet customer
requirements.

FY 2025 Highlights:

• Sales of 2,26,288 MTs

• Domestic Sales of 2,17,142 MTs

• Substantial growth in Premium Maplitho Products like
Truprint Ultra (39%), Truprint Ivory (20%) and Value
Added Products like Pharma Print (13%), Stiffener
(41%) and Cupstock Bottom (75%)

Operational highlights

With the shifting market dynamics, the Company increased
its participation in value-added products, including Sketch
Choice, Stiffener, Straw Paper and Azurelaid.

The Company had put in its paramount efforts to achieve
OTIF delivery rate (On- Time-In-Full) at 96%, forecast
accuracy to 91%, and improved complaint closure to 90%
that is uppermost tier in the Indian Paper Industry.

The Company is present in all segments of paper ranging
from writing, printing, industrial and copier papers. The
Company's share in the export was approximately 4% in
FY 2025. It remained focused on producing improved
quality Maplitho Products and value-added products with
higher Net Sales Realisations to increase profitability.

Mill Development & upgrade

Your Company has made significant strides in optimizing
its operations and investing in technologies that drive
both efficiency and sustainability. The Board sanctioned
capital expenditure aggregating to C520.40 Crores being
implemented in phased manner for the comprehensive
rebuild and upgrade of critical plant and machinery at
our Rajahmundry and Kadiyam manufacturing units. This
initiative replaces obsolete equipment and technology with
cutting-edge solutions, aiming to significantly enhance
operational efficiency, productivity, and product quality while
reducing our environmental footprint.

The Pulp Mill development at the Rajahmundry unit, which
began in 2023, focuses on these critical upgrades. To
date, C508.40 Crores of the earmarked amount has been
spent (including C84.81 Crores spent in May 2025, with
the remaining capital projects scheduled for completion
by July 2025.

Key Upgrades and Benefits

Our modernization program has successfully implemented

several key projects, delivering significant improvements:

Enhanced Pulp Production and Efficiency:

• Fiberline capacity upgraded to 630 TPD with the
installation of a modified chip feeding system
(Valmet G3 cooking technology) and an add-on wash
extraction screen set.

• New twin roll press technology improves unbleached
pulp washing and reduces alkali carryover to bleaching.

• Dhot technology in bleaching has reduced CLO2
consumption to below 13 Kg/T, reinforcing our
commitment to sustainable manufacturing.

• A new Valmet-designed tube-type evaporator
body has increased weak black liquor evaporation
capacity to 280 TPH.

Improved Recovery Boiler and Chemical Recovery:

• The recovery boiler was rebuilt to 1500 TDS by
replacing pressure parts with Andritz-designed spaced
tube-type coils, significantly improving reliability and
steam generation vital for energy self-sufficiency.

• A new 95 TPD Ash-leaching plant (Andritz technology)
treats ESP ash, reducing corrosive chlorides (now
around 5%) and potassium content in the recovery
liquor cycle, thereby enhancing boiler operational
reliability and thermal efficiency.

• The new 190 TPD lime kiln #3 and an upgraded re-
causticizer plant (supplying 3200 M3/day white liquor)
were successfully commissioned in May 2025.

• GLC-G3 technology has improved raw green liquor
filtration, reducing suspended solids to below 50 ppm
and enhancing white liquor quality.

Superior Paper Quality and Expanded Capacity:

• Paper Machine #5 at Rajahmundry was upgraded with
a new Voith film press size press and size kitchen,
enabling the production of surface-sized paper with
enhanced print quality and strength.

• A new size press and size kitchen were also installed
for KA#3 paper machine at Kadiyam, increasing
machine speed and contributing an incremental 10
TPD to production.

• The Waste Paper Recycling Plant at Kadiyam was
upgraded to 110 TPD, strengthening our capabilities in
utilizing recycled fibers.

Operational Enhancements and Sustainable

Technologies:

• Installation of a new Chipper (40 BDTPH) and
an 8.5 MW TG.

• New flash drying technology and disc filtration
technology for lime mud drying have increased
lime kiln operational reliability, production capacity,
and efficiency.

• A drag chain conveying system has reduced burnt lime
spillage and eliminated dust emissions.

• Major enhancements to the recovery boiler included
replacing the platen-type superheater with a more
efficient spaced tube type, improving its performance
and longevity.

• A new 7^th effect tube-type Valmet design Tubel
technology evaporator body was integrated with
existing lamella evaporator bodies in our 4F
Evaporators, optimizing the evaporation process.

Ongoing Projects for Long-Term Sustainable Growth:

We continue to invest in projects that underscore our
dedication to operational efficiency and sustainability:

• Non-Condensable Gas (NCG) Collection System
Upgrade: This critical project will safely collect and
incinerate highly pollutant, explosive, and corrosive
NCG gases. CNCG gases will be incinerated in the
lime kiln and DNCG gases in the recovery boiler,
significantly improving air quality and workplace safety.

o CNCG system start-up is planned during the
Annual Outage in CY 2025.

o DNCG system start-up is planned during the
Annual Outage in CY 2026.

• Ash Leaching Reject Treatment: A solution has been
developed to treat the inorganic rejects generated from
the ash leaching process, which are characterized
by high COD levels. Project erection is currently
underway, with start-up and commissioning targeted
for mid-September 2025. This treatment initiative is
expected to reduce the load on ETP and enhance the
quality of treated water.”

Green Field Expansion Project

In January 2023, the Board had given in-principle approval
to exploit opportunities in the Paper Board Segment through
expansion and capacity addition by setting up an integrated
Green Field Project at Unit Kadiyam, East Godavari District,
Andhra Pradesh. This proposed Mill Expansion Plan (MEP)
includes the installation of a 1,75,000 TPA Paper Board
Machine, a 1,60,000 TPA Writing & Printing Paper machine,
a 1,92,500 TPA New Chemical Wood Pulp mill, and an
87,500 BD TPA BCTMP connected along with a Recovery
Plant (1500 TPD of BLS). The plan also involves the
expansion of the Co-generation Power Plant from 5.74 MW
to 94 MW with a New Coal-fired Boiler and New TGs and
auxiliary facilities in the existing paper mill at Unit: Kadiyam.

In this regard, the Company has filed the requisite
application with the Ministry of Environment, Forest &
Climate Change (MoEF&CC) for Environmental Clearance.
The environmental clearance process involves stages
such as screening, scoping, public consultation including
a public hearing if required and appraisal by expert
committees (EAC/SEAC).

While the expansion program was aggressively pursued,
current sluggish market demand has led us to re-evaluate
its immediate advancement. Given the significant capital
expenditure involved, our strategy now focuses on pursuing
the expansion program and related approvals in a phased
manner close to an anticipated revival in market demand
aligning the expansion program with the profitability goals.

Tissue Paper Machine

In February 2024, the Board approved the installation of
a new tissue paper machine to produce various grades of
tissues—facial, napkin, toilet, and towel—to tap into the
growing market demand. Initially, the Company obtained
Consent to Establish from the Andhra Pradesh Pollution
Control Board (APPCB) on January 5, 2024, for installation
of a tissue machine with a capacity of 35,000 TPA at its
Kadiam facility.

However, the Company has since decided to strategically
relocate the installation to its Rajahmundry unit to leverage
the upgraded infrastructure, including an upgraded boiler,
enhanced steam generation, abundant water availability, a
robust Effluent Treatment Plant (ETP), established logistics,
well equipped quality control laboratory and adequate power
supply. This move eliminates potential transportation costs
associated with transferring excess pulp from Rajahmundry
to Kadiam. In contrast, Kadiam unit infrastructure need to be
upgraded necessitating capital expenditure to support such
operations. The Company will formally obtain necessary
approvals from APPCB in this regard.

In May 2024, an agreement was signed with Valmet AB
(Sweden) for the supply and commissioning of a tissue
paper production line with a capacity of up to 129 TPD,
expected to be delivered within 16 months from the order
date. Supporting infrastructure upgrades include the
enhancement of power transmission lines from 33KV to
132KV with an additional 7 MVA load, approved by the
Andhra Pradesh Eastern Power Distribution Company on
November 23, 2023.

The total approved capital expenditure for the project is C270
crores, targeting a production capacity of 100 TPD. Post
APPCB's revised approval, commissioning and commercial
operations are planned in Q1 FY 2026-27.

Raw Material Security

The Company continues to prioritize Forestry Research &
Development (R&D) aimed at enhancing farmers' income
from pulpwood plantations by increasing wood yield per unit
area while reducing input costs. Building on the encouraging
outcomes of the first phase of R&D projects, the Company
has signed a new Memorandum of Understanding (MoU)
with the Institute of Forest Genetics and Tree Breeding
(IFGTB), Coimbatore, for a five-year period from 2024 to
2028. Under this Phase-II collaboration, the Company
is advancing its scientific research programs to further
strengthen sustainable forestry practices.

Additionally, the Company has entered into a MoU with the
Institute of Forest Biodiversity (IFB), Hyderabad, to evaluate
the progress of its ongoing Farm Forestry program and to
receive strategic guidance for continuous improvement.

A key strategic focus is the phased transformation of
the Farm Forestry program from low-yield seed-origin
plantations to high-yield clonal plantations. To support this
transition, the Company is expanding capacity building
and infrastructure development to increase clonal plant
production. In 2024, the Company partnered with 38
nurseries in catchment areas to meet the growing demand
for clonal plants.

Farm Forestry extension remains a cornerstone of the
Company's engagement with rural communities. This
includes organizing village-level Meetings with farmers,
providing training to nursery growers and farmers, sharing
best practices for pulpwood plantation development,
and facilitating resolution of farmer concerns related
to wood resource development and procurement. The
Company supports farmers by supplying quality saplings at
subsidized rates, offering technical expertise for plantation
establishment, providing R&D support, and ensuring a
ready market for wood produce.

In 2024, the Company introduced the distribution of
Eucalyptus clonal plants and improved Subabul seeds
to further boost raw material availability. Under its Farm
Forestry program within the catchment area, the Company
has successfully facilitated the distribution of 205 Lakh
Casuarina clones, 799 Lakh Casuarina seedlings, 8 Lakh
Eucalyptus clones, 147 Lakh Subabul seedlings. These
efforts have covered approximately 15,036 hectares of
land and generated 75.18 Lakh man-days of employment,
significantly contributing to rural livelihood enhancement
and raw material security.

Committed to Excellence: Our Certifications

Your Company continues to uphold high standards across
its operations, consistently maintaining key international

certifications. Our Quality Management Systems and
Environment Management Systems are continually
accredited under ISO 9001 and ISO 14001, respectively.
These standards, updated in 2015, highlight the crucial
role of top management, proactive risk management, and
adaptive change management in ensuring our business
remains sustainable.

We continue to hold OHSAS 18001 certification
(Occupational Health and Safety Management System,), an
internationally recognized standard for effectively managing
occupational health and safety risks within our business.

Demonstrating our commitment to energy efficiency,
we have initiated Certification of Energy Management
System ISO: 50001:2018 and anticipate its completion
during FY 2025-26.

Energy Efficiency through PAT program: Your Company
is a Designated Consumer under the Ministry of Power's
Perform, Achieve, and Trade (PAT) program, a critical
government initiative aimed at enhancing industrial energy
efficiency. We are pleased to report that Your Company
successfully met the energy consumption reduction targets
for PAT Cycle I. However, the Company encountered
challenges in achieving the targets for PAT Cycle II. We
are actively addressing the learnings from this cycle to
enhance our future performance. For the financial year
2024-25, the Company falls under PAT Cycle VII. To ensure
robust compliance and successfully meet the stipulated
requirements, we have proactively appointed an authorized
third-party agency to conduct a “Monitoring & Verification”
(M&V) audit of our PAT Cycle VII targets, which is currently
underway. Through these concerted efforts, your Company
reaffirms its commitment to sustainable operations and
continuous improvement in energy efficiency, aligning with
the overarching goals of the PAT program and our broader
environmental stewardship.

Depository System

As on March 31, 2025, 46,137 Shareholders are holding
19,80,58,455 Shares in dematerialised mode constituting
99.6% of the paid up Equity Share Capital and 1323
shareholders are holding 791,740 shares in physical
mode constituting 0.4% paid up Equity Share Capital of
the Company.

Management Discussion and Analysis Report

The Report on Management's Discussion and Analysis,
as required under clause 2(e) of Regulation 34 read with
Schedule V of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 covering industry
structure and developments, opportunities and threats,
outlook, discussion on financial performance, etc., is
contained in “Management Discussion and Analysis Report”
that forms an integral part of this Report.

Employee Development and Engagement

The Company's agenda for engaging and developing its
employees encompasses a range of initiatives aimed at
attracting, nurturing, and retaining talent. Key focus areas
include diversity and inclusion, succession planning, building
a strong talent pool for critical positions, implementing quality
of life programs, and investing in leadership development.

We take a professional approach to industrial relations,
consistently treating our employees with dignity and respect
while upholding the core principles of labour relations.

We believe that an engaged and motivated workforce is
essential to our continued success. As an employee-centric
organization, we are committed to promoting work-life
balance and encouraging a healthy lifestyle. In support of
this, we organize various workshops and training programs
focused on enhancing both the quality of life and leadership
capabilities of our team. Additionally, our in-house gym and
recreation club, managed by the Staff Club Committee,
offer employees opportunities for fitness and leisure.

To further boost employee morale and foster a sense of
community, we host a variety of events such as Senior
Management Team Get-Togethers, garden parties, Diwali
celebrations, movie screenings, and live cricket telecasts.

Leveraging Information Technology for Enhanced
Operations

In FY 2024-25, the Company made significant strides in
strengthening its IT infrastructure and digital capabilities to
drive operational efficiency, security, and cost optimization.
Strategic upgrades across hardware, communication
networks, and business applications were implemented
to align with organizational objectives and ensure
sustainable growth.

Key IT initiatives completed:

a) Time & Attendance System Upgrade: Incorporated
emSphere, integrating facial recognition for seamless
attendance management, enhanced security, and a
76% reduction in recurring costs.

b) Communication Infrastructure Enhancement:
Migrated to Jio and Airtel (excluding Hyderabad),
doubling bandwidth, improving uptime, and reducing
communication expenses by 50%.

c) In-House Farm Forestry Application: Developed a
custom desktop and mobile solution, empowering field
staff with greater control while eliminating 100% of
third-party licensing costs.

d) Advanced Security Integration: Deployed facial
recognition-based door access control at critical
administrative locations, strengthening physical
security and preventing unauthorized access.

e) Financial Process Automation: Integrated banking

systems with enterprise resource planning (SAP)
software to streamline payment processes,

enhance reconciliation accuracy, and improve
transaction visibility.

f) Network Security Upgrade: Transitioned from legacy
systems to next-generation Palo Alto firewalls for
superior threat prevention, simplified management,
and cost savings.

g) Endpoint Security Modernization: Implemented Palo
Alto Cortex XDR for AI-driven threat detection and
behavioural analytics, resulting in a 46% reduction in
combined security expenses.

h) File Server Modernization: Replaced aging servers
with high-capacity (50 TB) HP servers, ensuring
secure, scalable, and faster file access.

i) Vehicle Tracking System: Introduced GPS tracking
in all Farm Forestry and pooled vehicles for real¬
time monitoring, route optimization, and enhanced
fleet security.

j) Email Platform Migration: Transitioned to a cost-
effective email solution, achieving savings of C55 Lakhs
annually while ensuring comparable service quality.

These initiatives have collectively reinforced the Company's
operational resilience, improved data security, and delivered
significant cost efficiencies.

Community Service and Engagement

The Company is deeply committed to fostering inclusive
growth and supporting the communities in which it operates,
considering them a key stakeholder. This commitment is
demonstrated through comprehensive Corporate Social
Responsibility (CSR) initiatives that directly address the
genuine requirements of the local populace.

The Company is dedicated to providing substantial
infrastructure support to schools and educational institutions
in and around its operational areas of Rajahmundry
and Kadiyam. This commitment primarily benefits less
privileged sections of society and aims to encourage school
attendance. Its support encompasses the construction
of essential facilities such as classrooms, dining sheds,
and compound walls, as well as providing furniture and
computer equipment, Merit scholarship all designed to
create a conducive learning environment.

In the realm of Health & Wellness, the Company has
been instrumental in providing infrastructure facilities to
Community Health Centers by supplying critical medical
instruments such as ultrasound machines, fetal dopplers,
X-ray units, alongside essential amenities like AC units, RO
plants, and parking sheds. Support also extends to General
Hospitals through the provision of specialized medical

equipment for diagnosis, treatment, surgery and patient
care and monitoring.

Community development and livelihood interventions
are central to the Company's efforts. This includes the
establishment of Skill Development Centers, construction
of community halls, construction of culverts in paddy fields,
drains, supplying drinking water, providing tractors for solid
waste management, street-lights, construction of toilets
and bathing ghats for villagers. Furthermore, it supports
women empowerment through tailoring centers for skill
development provides essential supplies and infra support
to Anganwadi Centres.

Beyond these core areas, the Company actively cooperates
with local administration to support projects that directly aid
and assist the general public. This includes the construction
of water sump and pump house for diverting excess
water during rainy season into canals to avoid flooding
in neighbourhood villages, supplying food kits to flood-
affected people, promoting public safety through initiatives
like providing helmets for safety campaigns and undertaking
cleaning of river bund under the swatch bharat campaign.

Through these diverse activities, the Company consistently
strives for the overall development and welfare of society,
focusing on enhancing educational opportunities, improving
healthcare access, strengthening community infrastructure,
and empowering less privileged sections of society.

The Company has adopted a CSR Policy which is placed
on the Company's website: www.andhrapaper.com. The
Members of Corporate Social Responsibility Committee as
on March 31,2025 comprised of:

The Annual Report on CSR activities is attached as
Annexure - 1 to this report.

Awards

During the year, the Company has won the “BRONZE” for
the Best Safety performer for the year 2024

(Category- Chemical & Paper Industries) at CII
(Confederation of Indian Industry) Andhra Pradesh Industrial
Safety excellence awards 2024 for Unit: Rajahmundry.

Related Party Transactions

Your Company has in place a Policy on Materiality of
Related Party Transactions and dealing with Related
Party Transactions, which governs the review and
approval process for all related party transactions. All such

transactions are placed before the Audit Committee for
prior approval. Omnibus approvals are also obtained for
transactions that are repetitive in nature. Where the exact
value of transactions cannot be estimated, the Committee
grants approval based on reasonable projections for the
financial year.

All related party transactions entered into during the year
under review were in the ordinary course of business and on
an arm's length basis. There were no material or significant
related party transactions with promoters, promoter group
entities, directors, or key managerial personnel that could
potentially conflict with the interests of the Company at large.
Accordingly, disclosure in Form AOC-2 is not applicable.
However, Form AOC-2 is appended as Annexure 2 for
completeness.”

The Board of Directors approved a Policy on Related Party
Transactions which is placed on the Company's website
https://andhrapaper.com/wp-content/uploads/2023/04/
Policy-on-related-party-transactions-1.pdf. The disclosures
on related party transactions are given in Notes to the
financial statements.

Remuneration Policy

The Company has adopted the Nomination and
Remuneration Committee Charter which contains, inter alia,
framework for Directors' appointment and remuneration,
criteria for determining the qualifications, positive attributes,
independence of a director and other matters provided under
Section 178(3) of the Companies Act, 2013 (“The Act”).

Pursuant to Section 178(4) of the Act, the Company also
adopted Remuneration Policy relating to remuneration
for the Directors, Key Managerial Personnel and Senior
Executives in the rank of Vice President and above. The
Remuneration Policy is placed on Company's website
https://andhrapaper.com/wp-content/themes/andhra_
paper/uploads/investors/1599824266Remuneration%20
Policy.pdf

Energy Conservation, Technology Absorption &
Foreign Exchange earnings and outgo

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

Risk Management

The Company has a robust business risk management
framework to proactively identify and evaluate potential
business risks and opportunities. This framework aims
to create transparency, minimize adverse impact of risks
on the business objectives and enhance the Company's

competitive advantage. The Indian Paper Manufacturers
Association (IPMA) has pinpointed several key concerns for
the domestic paper industry such as Raw Material scarcity,
surge in cheaper imports, unfavourable FTAs, Diversion
of excess substandard inventory to India, lack of policy
support and stringent regulations as major areas of concern
for the domestic paper industry. The risks associated with
the business, their description and the measures being
undertaken by the Company to mitigate the risks is more
detailed in the Management and Discussion Analysis
Report forming part of this annual report.

Directors

During the year, Mr. Sitaram Sharma, Non-Executive
Independent Director, expressed inability to continue in view
of his health issues and ceased from the directorship of the
Company w.e.f closure of business hours of March 31,2025
post expiry of the first term as in independent Director. The
Board placed on record its appreciation for the excellent
contribution made by Mr. Sitaram Sharma during his tenure
as a Non-Executive Independent Director.

Effective November 4, 2024, Mr. S.K. Bangur stepped
down as Managing Director and continues to serve as the
Chairman & Non-Executive Director of the Company and
simultaneously, Mr. Saurabh Bangur assumed the role of
Managing Director, elevated from his previous position as
Joint Managing Director.

During the year, Mr. Virendra Sinha has been re-appointed
as Non-Executive & Independent Director for second term
for a period of 3 years w.e.f. April 1,2025 to March 31,2028.

Mr. Virendraa Bangur, Non-Executive Director, is liable to
retire by rotation at the ensuing Annual General Meeting,
as per the provisions of the Companies Act, 2013 and being
eligible, offered himself for reappointment.

The Board of Directors, on the recommendation of
Nomination and Remuneration Committee, reappointed
Mrs. Papia Sengupta as an Independent Director of the
Company for second term for a period of 3 years effective
September 1, 2025 to August 31, 2028 subject to approval
of shareholders at the ensuing Annual General Meeting.

The Board commends their reappointment.

Independent Directors

Mr. Virendra Sinha, Mrs. Papia Sengupta, Mr. Arun Kumar
Sureka and Mr. Sudarshan Vijaynarain Somani are
Independent Directors of the Company.

All Independent Directors have given declarations that
they meet the criteria of independence as laid down under
Section 149 (6) of the Act and Regulations 16(1 )(b) and
25(8) of Securities and Exchange Board of India (Listing

Obligations and Disclosure Requirements) Regulations,
2015 (“the SEBI Listing Regulations”) and that they are
independent from the Management of the Company and
they are not aware of any circumstance or situation, which
exist or may be reasonably anticipated, that could impair or
impact his ability to discharge his duties with an objective
independent judgment and without any external influence.

Further, all the Independent Directors have given
declarations that they complied with the provisions of
Companies (Appointment and Qualifications of Directors)
Rules, 2014. Further, they have given declarations that they
have complied with the Code for Independent Directors
prescribed in Schedule IV to the Act and the Code of
Business Conduct and Ethics of the Company.

A separate Meeting of Independent Directors was held
on March 18, 2025. All the Independent Directors of the
Company attended the said Meeting.

Details of Key Managerial Personnel

As on March 31, 2025, Mr. Saurabh Bangur, Managing
Director, Mr. Mukesh Jain, Whole-time Director (Executive
Director), Mr. Rajesh Bothra, Chief Financial Officer and
Mr. Bijay Kumar Sanku, Company Secretary are the Key
Managerial Personnel of the Company.

Meetings of the Board

During the year under review, 4 (Four) Board Meetings and
4 (Four) Audit Committee Meetings were held. The maximum
interval between any two Meetings did not exceed 120 days,
as prescribed by the Companies Act, 2013. The details of
the Meetings held are given in the Corporate Governance
Report forming part of this Report.

Performance Evaluation

Pursuant to the provisions of the Act and SEBI Listing
Regulations, the Annual performance evaluation of Board,
Committees of the Board, Chairman, Managing Director
and Whole-time Director (Executive Director) has been
carried out based on various parameters.

A separate exercise for the financial year 2024-25 was
carried out to evaluate the performance of all individual
directors including Independent Directors who were
evaluated on parameters such as level of engagement and
contribution, independence of judgment, safeguarding the
interests of the Company and its minority shareholders etc.

Board Training and Induction

At the time of appointing a Director, a formal letter of
appointment is issued, clearly outlining their role, functions,
duties, and responsibilities as a Director of the Company.
This letter, in compliance with applicable laws, also details
the statutory obligations and compliances expected from

them under the Companies Act, 2013, the SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015, and other relevant laws and regulations. Furthermore,
it explicitly covers aspects such as the Code of Conduct,
Insider Trading Code, and the policy on Related Party
Transactions, as mandated by SEBI LODR.

To foster informed decision-making and ensure good
governance, the Board of Directors and its Committees
are consistently apprised by management. These
regular updates provide a holistic view of the Company's
landscape, covering Business operations and financial
performance, Detailed insights into operational efficiency
and the Company's financial health, Progress and
developments regarding key strategic objectives and
growth plans, analysis of prevailing market scenario,
competitive landscape, identification of potential headwinds,
potential risks and mitigation strategies, opportunities and
challenges and updates on adherence to the Companies
Act, 2013, SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, and other pertinent
laws and regulations, ensuring the Company operates
within the prescribed legal framework. This continuous and
critical flow of information empowers Directors to effectively
discharge their fiduciary duties, exercise diligent oversight,
and make well-considered decisions that contribute directly
to the Company's sustainable growth and the enhancement
of shareholder value.

Details of Familiarization of Directors are disclosed on the
Company's website www.andhrapaper.com.

Audit Committee

The Audit Committee as on March 31, 2025 comprises of
Mr. Sudarshan V. Somani as Chairman and Mr. Virendra
Sinha, Mr. Arun Kumar Sureka and Mr Saurabh Bangur as
other Members. All the recommendations made by the Audit
Committee were accepted by the Board.

Particulars of Employees

The information required pursuant to Section 197 read
with Rule 5 (1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014
in respect of employees of the Company, is provided in
Annexure-4. Having regard to the provisions of the second
proviso to Section 136(1) of the Act, the Annual Report
excluding the aforesaid information is being sent to the
members of the Company. If any Member is interested
in obtaining information on Rule 5 (2) of the Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, such member may, write to the Company
Secretary at the Registered Office in this regard or can
inspect the related documents/information at the Registered
Office of the Company.

Vigil/Whistle Mechanism

The Company has adopted Whistle Blower Policy to deal
with instance of fraud or any unethical or improper practices.
A copy of this Policy is available on the Company's website
https://andhrapaper.com/wp-content/themes/andhra_paper
/uploads/investors/1658382966Whistle%20Blower%20
Policy%20modified%20on%2021.07.2022.

Internal Financial Controls

The Company established internal financial control(s)
commensurate with the size, scale and complexity of the
operations. Internal audit function is being handled by
a professional firm of chartered accountants. The main
function of Internal Audit is to monitor and evaluate adequacy
of internal control system in the Company, its compliance
with the operating systems, accounting procedures and
policies at all locations of the Company. Based on the report
of internal audit function, process owners take corrective
action in their respective areas and thereby strengthen
the controls. Significant audit observations and corrective
actions are reported to the Audit Committee.

Statutory Auditors audited the Internal Financial Controls
(IFC) over financial reporting of the Company as of March
31,2025 in conjunction with audit of the financial statements
of the Company for the year ended on that date. Unmodified
opinion on IFC was given by them.

Statutory Auditors

The Report of Auditors for the financial Year 2024-25 does
not have any qualifications, reservations or adverse remarks.
The Report is enclosed with the financial statements in this
Annual Report.

Messrs MSKA & Associates, Chartered Accountants,
Statutory Auditors of the Company have been appointed, for
a term of five years, to hold office from the conclusion of 58^th
Annual General Meeting till the conclusion of 63^rd Annual
General Meeting corresponding to the financial years from
2022-23 to 2026-27.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act and the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Company had appointed M/s.
D. Hanumanta Raju & Co., a firm of Company Secretaries
to undertake the secretarial audit of the Company for the
financial year 2024-25. Secretarial Audit Report under
Section 204(1) of the Act issued by M/s. D. Hanumanta
Raju & Co., Practicing Company Secretaries, in respect
of financial year 2024-25 is attached as Annexure - 5 to
this Report.

Based on the recommendations of Audit Committee, M/s.
Hanumanta Raju & Co., Practicing Company Secretaries,
Hyderabad has been appointed as Secretarial Auditors
of the Company for a period of 5 years from FY 2025-26
to FY 2029-30 subject to approval of shareholders at the
ensuing Annual General Meeting.

The Secretarial Audit Report includes an observation
regarding a fine imposed by the Stock Exchanges (BSE and
NSE) for an alleged non-compliance with Regulation 17(1)
(A) of the SEBI LODR Regulations, 2015. This relates to
Mr. S.K. Bangur's transition from Managing Director to Non¬
Executive Director and Chairman while he attained 75 years
of age, which requires prior approval of member. While the
Exchanges levied a fine of C94,000 each (totalling C188,000
excluding GST) for the quarter ended March 31, 2025,
the Company firmly believes it is in full compliance with
the relevant provisions. An application for waiver of these
fines, providing detailed justification, has been submitted
and a formal decision by the designated exchange NSE
is awaited. As on May 8, 2025 the Company awaits the
Exchanges decision.”

Internal Auditors

M/s. Batliboi & Purohit, Chartered Accountants, Mumbai
were appointed as the Internal Auditors for FY 2024-25.
The internal audit reports and the suggestions made on
a quarterly basis by the auditors, during the year under
review, were duly noted by the Board and acted upon. The
Board of Directors, based on the recommendation of the
Audit Committee have re-appointed the said firm as the
Internal Auditors of your Company for the FY 2025-26.

Cost Auditors

In terms of Section 148 of the Act read with the Companies
(Audit & Auditors) Rules, 2014, the Board at their Meeting
held on May 8, 2025, on the recommendation of Audit
Committee, appointed M/s. Narasimha Murthy & Co., Cost
Accountants as Cost Auditors of the Company for the
financial year 2025-26, at a remuneration of C4.50 Lakhs
plus applicable taxes and reimbursement of out-of-pocket
expenses and their remuneration is being submitted for
ratification by the Members at the forthcoming Annual
General Meeting.

Cost Accounting Records and Cost Audit

Cost accounting records for the financial year under review
were maintained as per the Companies (Cost Records
and Audit) Rules, 2014. M/s. Narasimha Murthy & Co,
Cost Accountants were appointed as Cost Auditors of the
Company to audit the Cost Records for the year ended
March 31, 2025. The Cost Audit Report for the financial
year ended March 31, 2024 was filed with the Ministry of

Corporate Affairs in August, 2024. The Cost auditors have
audited and expressed satisfaction about the maintenance
of cost audit records, internal controls and issued an
unqualified report.

The Cost Audit Report for the year ended March 31, 2025
will be filed within the due date.

Public Deposits

The Company has not invited, accepted or renewed any
deposits under chapter V of Companies act, 2013. That the
company has not been accepted any deposits, so there
was no obligation arise to repay or pay any interest and
no amount on account of principal or interest on deposits
was outstanding as on the date of the balance sheet and
thus no default.

Particulars of loans, guarantees, security or
investments

The particulars of loans, guarantees, and investments
covered under the provisions of Section 186 of the Act have
been disclosed in the financial statements.

Subsidiary Company

Andhra Paper Foundation (Foundation), wholly-owned
subsidiary ceased operations and activities since 2022 as
the parent company directly absorbed all Corporate Social
Responsibility (CSR) initiatives. The Foundation's original
purpose became redundant, leading to unnecessary
compliance burdens. Consequently, the Foundation
surrendered its Sections 12AA and 80G registrations under
the Income Tax Act, 1961. An application was filed with the
concerned Regional Director to strike off the Foundation
under Section 248 of the Companies Act, 2013. The
Regional Director vide its order dated November 11, 2024
allowed conversion into a private limited company, Andhra
Paper Private Limited (APPL). Subsequently, APPL filed
Form STK-2 with the Registrar of Companies, Vijayawada,
to strike off its name from the Register of Companies under
Section 248 of the Companies Act, 2013. As on May 8,
2025 the application status is showing as “Under Process
of Striking off”.

A statement containing salient features of the financial
statement of Foundation as on November 11, 2024 is
attached as Annexure - 6 to this Report.

Annual Return

In terms of Section 92(3) of the Act, the Annual Return
for the financial year ended March 31, 2025 is displayed
on the website of the Company https://andhrapaper.com/
wp-content/uploads/2025/07/Draft-Annual-Return-for-the-
financial-year-ended-March-31-2025.pdf

Business Responsibility and Sustainability
Report (‘BRSR’)

Pursuant to Regulation 34 of the SEBI Listing Regulations,
'Business Responsibility and Sustainability Report' forms
part of this Report as Annexure - 7, which describes the
initiatives taken by the Company from an Environmental,
Social and Governance perspective.

Material changes and commitments affecting
the financial position of the Company which
occurred between end of financial year and date
of the Report

There was no change in the nature of business of the
Company during the year. There were no material changes
and commitments affecting the financial position of the
Company which occurred between end of financial year and
date of the report.

Directors’ Responsibility Statement

The Board of Directors hereby confirms and declares that:

• In the preparation of final accounts for the year ended
March 31, 2025 the applicable accounting standards
had been followed;

• they had 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 at the financial year end March 31,2025 and
of the profit and loss of the Company for the year;

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

• they had prepared the accounts for the year ended
March 31,2025 on a 'going concern' basis;

• they had laid down internal financial controls to be
followed by the Company and that such internal
financial controls are adequate and were operating
effectively;

• they had devised proper systems to ensure compliance
with the provisions of all applicable laws and that such
systems were adequate and operating effectively.

General

• There were no significant and material orders passed
by the regulators or courts or tribunals which would
impact the going concern status of the Company and
its future operations.

• During the year under review, neither the statutory
auditors nor the secretarial auditor has reported to
the audit committee, under Section 143 (12) of the
Companies Act, 2013, any instances of fraud committed
against the Company by its officers or employees.

• The Company has zero tolerance for sexual
harassment at workplace and has adopted a policy
on prevention, prohibition and redressal of sexual
harassment at workplace in line with the provisions
of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and
the Rules thereunder for prevention and redressal
of complaints of sexual harassment at workplace.
Internal Complaints Committee (ICC) has been set
up to redress complaints received regarding sexual
harassment. All women employees (permanent,
contractual, temporary, trainees) are covered under
this policy. During the year, no complaints were
received by the Company under Sexual Harassment
of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013.

• There is no application or proceeding pending under

Insolvency and bankruptcy code 2016

• The company has complied with all the applicable
laws, rules, regulations and secretarial standards

• All Policies as required under the Act or the SEBI
Listing Regulations are available on the website of the
Company www.andhrapaper.com.

• Details of difference between amount of the valuation
done at the time of one-time settlement and the
valuation done while taking loan from the Banks or
Financial Institutions along with the reasons thereof:
Not applicable.

Acknowledgements

The Board of Directors wish to place on record their gratitude
to the Central Government, Government of Andhra Pradesh,
Government of Telangana and Company's Bankers for their
continued support during the year.

The Board of Directors wish to convey their thanks to the
valued customers and dealers for their continued patronage
and place on record their appreciation of the contribution
made by all the employees during the year under review.

For and on behalf of the Board

Place: Rajahmundry Shree Kumar Bangur

Date: May 08, 2025 Chairman & Non-Executive Director