About Gujarat Gas Ltd

Gujarat Gas Limited (formerly known as GSPC Distribution Networks Limited), is India's largest city gas distribution player with presence spread across 22 Districts in the State of Gujarat and Union Territory of Dadra Nagar Haveli and Thane GA which includes Palghar district of Maharashtra. The company has India's largest customer base in major user segments. The company has around 30,000 km of gas pipeline network. It has 559 CNG stations and provides close to 6 mmscmd of Natural Gas to over 1.55 million households and over 4000 industrial customers. Gujarat Gas Limited (formerly known as GSPC Distribution Networks Limited) was incorporated on 21 February 2012, as a public limited company under the Companies Act, 1956, with its main object to carry on, sale, purchase, supply, distribution, transport, trading in Natural Gas, CNG, LNG & other Gaseous form through Pipelines, Trucks/Trains or such other suitable mode for transportation/distribution of Natural Gas, CNG, LNG, LPG & other Gaseous Form. In October 2012, Gujarat State Petroleum Corporation (GSPC) announced that it had signed definitive agreement for acquiring 65.12% equity stake in Gujarat Gas Company Limited (GGCL) from London-based British Gas Group through Gujarat Gas Limited (GGL). GGL paid Rs 295 per share to BG Group for acquiring its 65.12% stake in GGCL, aggregating to Rs 2463.46 crore. GGL acquired further 8.58% stake in GGCL through an open offer to the shareholders of GGCL at a price of Rs 314.17 per share, aggregating to Rs 347.68 crore. The Members of the Board at its meeting held on 24 February 2014 granted in-principle to the consolidation by way of amalgamation of GGL, GSPC Gas, GGCL, GFSL and GTCL through a High Court approved Composite Scheme of Amalgamation and Arrangement. The Board at its meeting held on 21 April 2014 approved the Scheme of Amalgamation. Pursuant to the Scheme, Gujarat Gas Limited (GGL) has been vested with the city gas distribution (CGD) business of GSPC Gas, Gujarat Gas Company Limited (GGCL), GFSL and GTCL with effect from 1 April 2013.Gujarat Gas Limited was listed on the bourses on 15 September 2015. On 17 December 2015, Gujarat Gas (GGL) informed the stock exchanges that it has executed a Gas Purchase Contract for Regasified LNG with Gujarat State Petroleum Corporation Limited. This shall effectively enable GGL to purchase 0.50 mmscmd additional Regasified LNG on long term basis valid up to 0600 hrs of 1 July 2025. On 4 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB vide its letter dated 27 May 2016 has granted authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Amreli district in Gujarat and GGL has accepted the authorization. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 26 May 2041 and 60 months of marketing exclusivity valid up to 26 May 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 7,477 sq. kms. On 13 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB vide its letter dated 6 June 2016 has granted authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Dahej-Vagra Taluka, Bharuch district in Gujarat and GGL has accepted the authorization. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 5 June 2041 and 60 months of marketing exclusivity valid up to 5 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 909.09 sq. kms. On 27 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB has issued the letter dated 22 June 2016 for Grant of Authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Ahmedabad district (excluding the area already authorized) in the State of Gujarat and GGL has accepted the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 27 June 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 21 June 2041 and 60 months of marketing exclusivity valid up to 21 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 5,760.41 sq. kms. On 30 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB has issued the letter dated 27 June 2016 for Grant of Authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Dahod district in Gujarat, GGL has accepted the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 28 June 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 26 June 2041 and 60 months of marketing exclusivity valid up to 26 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 3,636 sq. kms. On 7 July 2016, Gujarat Gas informed the stock exchanges that pursuant to the letter from the PNGRB dated 4 July 2016 for Grant of Authorisation to Gujarat Gas Limited (GGL) to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Areas of Panchmahal District and Anand District (excluding the area already authorized) in the State of Gujarat, GGL has accepted both the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 7 July 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 3 July 2041 and 60 months of marketing exclusivity valid up to 3 July 2021 for each of the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 3,304 sq. kms for Panchmahal District and 1,888.96 sq. kms for Anand District (excluding the area already authorized). On 30 May 2017, Gujarat Gas Limited (GGL) announced that it has entered into a non-binding MoU with Petronet LNG Limited (PLL) for exploring - dispensing and marketing of LNG including the L-CNG at GGL CNG stations. In March 2020,subsequent to the outbreak of Coronavirus (COVID-19) followed by countrywide lock down, the Company continued its uninterrupted supply of Natural Gas to its customers based on their requirement. However, the lockdown had an impact in the immediate natural gas demand, mainly from Industrial and CNG customers. As restrictions are being lifted gradually in many of Company's operating areas, demand has started showing up an increasing trend both in industrial and CNG segments. As on 31 March 2020,the company has one associate company,namely Guj Info Petro Ltd. During the quarter ended 30 June 2020,the company commercialized 13 new CNG stations.During the quarter ended 30 September 2020,the company commercialized 51 new CNG stations. During the quarter ended 31 December 2020,the company commercialized 83 new CNG stations. During the year ended on 31 March 2021, the Company added 150 new CNG stations, the highest by any City Gas Distribution (CGD) company in lndia. The company also added more than 1,00,000 households, 350 industrial customers and laid pipeline network of over 4600 kms including commissioned as well as ongoing projects. The Company continues to hold the leadership position in CGD industry in terms of size and scale of operation, with more than 1.55 million households, over 13,000 commercial customers, 559 CNG stations, over 4,000 industrial units and close 30,000 kilometre of natural gas pipeline network, as on 31 March 2021.

Gujarat Gas Ltd Chairman Speech

Gujarat Gas Ltd Company History

Gujarat Gas Limited (formerly known as GSPC Distribution Networks Limited), is India's largest city gas distribution player with presence spread across 22 Districts in the State of Gujarat and Union Territory of Dadra Nagar Haveli and Thane GA which includes Palghar district of Maharashtra. The company has India's largest customer base in major user segments. The company has around 30,000 km of gas pipeline network. It has 559 CNG stations and provides close to 6 mmscmd of Natural Gas to over 1.55 million households and over 4000 industrial customers. Gujarat Gas Limited (formerly known as GSPC Distribution Networks Limited) was incorporated on 21 February 2012, as a public limited company under the Companies Act, 1956, with its main object to carry on, sale, purchase, supply, distribution, transport, trading in Natural Gas, CNG, LNG & other Gaseous form through Pipelines, Trucks/Trains or such other suitable mode for transportation/distribution of Natural Gas, CNG, LNG, LPG & other Gaseous Form. In October 2012, Gujarat State Petroleum Corporation (GSPC) announced that it had signed definitive agreement for acquiring 65.12% equity stake in Gujarat Gas Company Limited (GGCL) from London-based British Gas Group through Gujarat Gas Limited (GGL). GGL paid Rs 295 per share to BG Group for acquiring its 65.12% stake in GGCL, aggregating to Rs 2463.46 crore. GGL acquired further 8.58% stake in GGCL through an open offer to the shareholders of GGCL at a price of Rs 314.17 per share, aggregating to Rs 347.68 crore. The Members of the Board at its meeting held on 24 February 2014 granted in-principle to the consolidation by way of amalgamation of GGL, GSPC Gas, GGCL, GFSL and GTCL through a High Court approved Composite Scheme of Amalgamation and Arrangement. The Board at its meeting held on 21 April 2014 approved the Scheme of Amalgamation. Pursuant to the Scheme, Gujarat Gas Limited (GGL) has been vested with the city gas distribution (CGD) business of GSPC Gas, Gujarat Gas Company Limited (GGCL), GFSL and GTCL with effect from 1 April 2013.Gujarat Gas Limited was listed on the bourses on 15 September 2015. On 17 December 2015, Gujarat Gas (GGL) informed the stock exchanges that it has executed a Gas Purchase Contract for Regasified LNG with Gujarat State Petroleum Corporation Limited. This shall effectively enable GGL to purchase 0.50 mmscmd additional Regasified LNG on long term basis valid up to 0600 hrs of 1 July 2025. On 4 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB vide its letter dated 27 May 2016 has granted authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Amreli district in Gujarat and GGL has accepted the authorization. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 26 May 2041 and 60 months of marketing exclusivity valid up to 26 May 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 7,477 sq. kms. On 13 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB vide its letter dated 6 June 2016 has granted authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Dahej-Vagra Taluka, Bharuch district in Gujarat and GGL has accepted the authorization. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 5 June 2041 and 60 months of marketing exclusivity valid up to 5 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 909.09 sq. kms. On 27 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB has issued the letter dated 22 June 2016 for Grant of Authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Ahmedabad district (excluding the area already authorized) in the State of Gujarat and GGL has accepted the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 27 June 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 21 June 2041 and 60 months of marketing exclusivity valid up to 21 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 5,760.41 sq. kms. On 30 June 2016, Gujarat Gas (GGL) informed the stock exchanges that PNGRB has issued the letter dated 27 June 2016 for Grant of Authorisation to the company to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Area of Dahod district in Gujarat, GGL has accepted the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 28 June 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 26 June 2041 and 60 months of marketing exclusivity valid up to 26 June 2021 for the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 3,636 sq. kms. On 7 July 2016, Gujarat Gas informed the stock exchanges that pursuant to the letter from the PNGRB dated 4 July 2016 for Grant of Authorisation to Gujarat Gas Limited (GGL) to lay, build, operate, or expand City or Local Natural Gas Distribution network (CGD network) for the Geographical Areas of Panchmahal District and Anand District (excluding the area already authorized) in the State of Gujarat, GGL has accepted both the authorisation in Schedule D of the PNGRB vide a confirmation letter to PNGRB on 7 July 2016. As per the provisions of the PNGRB (Exclusivity for City or Local Natural Gas Distribution Networks) Regulation, 2008, GGL has been granted 300 months of infrastructure exclusivity i.e. valid up to 3 July 2041 and 60 months of marketing exclusivity valid up to 3 July 2021 for each of the CGD network. Further, the Authorised area for laying, building, operating or expanding the proposed CGD Network shall cover a geographical area of 3,304 sq. kms for Panchmahal District and 1,888.96 sq. kms for Anand District (excluding the area already authorized). On 30 May 2017, Gujarat Gas Limited (GGL) announced that it has entered into a non-binding MoU with Petronet LNG Limited (PLL) for exploring - dispensing and marketing of LNG including the L-CNG at GGL CNG stations. In March 2020,subsequent to the outbreak of Coronavirus (COVID-19) followed by countrywide lock down, the Company continued its uninterrupted supply of Natural Gas to its customers based on their requirement. However, the lockdown had an impact in the immediate natural gas demand, mainly from Industrial and CNG customers. As restrictions are being lifted gradually in many of Company's operating areas, demand has started showing up an increasing trend both in industrial and CNG segments. As on 31 March 2020,the company has one associate company,namely Guj Info Petro Ltd. During the quarter ended 30 June 2020,the company commercialized 13 new CNG stations.During the quarter ended 30 September 2020,the company commercialized 51 new CNG stations. During the quarter ended 31 December 2020,the company commercialized 83 new CNG stations. During the year ended on 31 March 2021, the Company added 150 new CNG stations, the highest by any City Gas Distribution (CGD) company in lndia. The company also added more than 1,00,000 households, 350 industrial customers and laid pipeline network of over 4600 kms including commissioned as well as ongoing projects. The Company continues to hold the leadership position in CGD industry in terms of size and scale of operation, with more than 1.55 million households, over 13,000 commercial customers, 559 CNG stations, over 4,000 industrial units and close 30,000 kilometre of natural gas pipeline network, as on 31 March 2021.

Gujarat Gas Ltd Directors Reports

Dear Members, Gujarat Gas Limited

Your Directors have pleasure in presenting the 9th Annual Report and the Audited Financial Statements for the Financial Year ended on 31st March 2021.

(Rs. in Crores)

PERFORMANCE HIGHLIGHTS

• Gujarat Gas won the Business Today BEST CEO AWARD 2020 in the Oil & Gas sector and ranked overall second across all sectors.

• Gujarat Gas won the Business Standard STAR PSU AWARD 2020

• Total volumes at ~same level of previous year despite Covid-19 impact in FY 21 (FY-21 9.39 mmscmd vs FY-20 9.44 mmscmd). Highest gas sales, crossed 12 mmscmd in Q4 FY 21; 22% volume growth in Q4 FY 21 as compared to Q4 FY 20

• Highest annual profit before tax of Rs 1,705 crores, increase by 41% compared to previous year

• Prepayment of term loans of Rs 988 crores during FY 21 through internal accruals bringing the debt levels at less than Rs 900 crores as on year end

• 150 new CNG Stations erected / commissioned in FY 2021; highest in the history of GGL

• New Domestic Connections of more than 1 Lakh in FY 2021

• Successful in ensuring uninterrupted gas supplies to its customers during Covid 19 pandemic and ensuing lockdown

• Currently supplying gas in all the Geographical Areas recently won in PNGRB's Bidding Round 9 and 10.

• First LNG/LCNG station in Gujarat - commissioned at Rajpipla in record six months' time

• Pipeline projects Outside Gujarat Geographical Areas ; Jalore Sirohi Pindwara Steel pipeline 54 km laid, Madhya Pradesh - EPC contract - Steel pipeline - 33 km laid, Thane GA - Vasai/Virar & Dahanu - Virtual Pipeline and Domestic connections commissioned

• Integrated QHSE Management System of the Company has been assessed and certified as complying with the requirements of International Standards for Quality Management System - ISO 9001:2015, Environment Management System - ISO 14001:2015 and Occupational Health & Safety Management System - ISO 45001:2018

DIVIDEND

Your Directors recommend for consideration of the shareholders at the 9th Annual General Meeting, the Dividend of Rs. 2/- per fully paid up equity share of Rs. 2/- each (100%) on 68,83,90,125 equity shares for the Financial Year 2020-21. The weblink for Dividend Distribution Policy is available at https://www.gujaratgas.com/resources/downloads/policy-on-dividend-distribution.pdf

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES

Your Company does not have any subsidiary and joint venture. Guj Info Petro Limited is the Associate of your Company and the statement containing salient features of financial statements of Guj Info Petro Limited under first proviso to sub section (3) of section 129 in form AOC-1 is attached at Annexure-5.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company represents consolidation of Financial Statements of Guj Info Petro Limited (GIPL), the associate company and Gujarat Gas Limited Employees Welfare Stock Option Trust (ESOP Trust), in accordance with IND AS. DEPOSITS

During the year under review, your Company has not accepted deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The details of Loans, Guarantees, Securities and Investments, if any covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Party Transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. A statement giving details of all Related Party Transactions is placed before the Audit Committee for approval/ ratification on a quarterly basis, as the case may be. The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is uploaded on the Company's Website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. The particulars of contracts or arrangements with Related Parties referred to in

Section 188 (1) of the Companies Act, 2013, as prescribed in Form AOC - 2 of the Companies (Accounts) Rules, 2014 is enclosed herewith as Annexure -4 to this Report.

(Rs. in Crores)

Transfer of City Gas Distribution (CGD) Business of Amritsar and Bhatinda Geographical Areas (Gas)

Petroleum and Natural Gas Regulatory Board (“PNGRB”) granted authorization in favour of Gujarat State Petronet Limited (“GSPL”, parent company of Gujarat Gas Limited) for laying, building, operating or expanding City Gas Distribution network in GAs of Amritsar (May 2015) and Bhatinda (May 2016) District in the State of Punjab. In furtherance of overall strategic business objective and synergies, GSPL and Gujarat Gas Limited (“GGL” or “the Company”) requested PNGRB for transfer of these GAs authorizations to GGL in line with applicable PNGRB Regulations. After due examination, PNGRB provided approval dated 29 June 2020 for transfer of these authorization for Amritsar and Bhatinda GAs from GSPL to GGL subject to fulfilment of below three conditions:

1) Revised Performance Bank Guarantee (PBG)

2) Revised Gas Sale Agreement in name of GGL

3) Financial Closure

During the year, the Company fulfilled the above conditions and same has been duly acknowledged and accepted by PNGRB.

The Board of the Company has approved the valuation and transfer / purchase of CGD Business of Amritsar and Bhatinda GAs from GSPL to the Company for cash consideration of INR 163.31 Crores (subject to various transaction adjustments) by slump sale through business transfer agreement at its meeting held on 1st June 2021.

As on 31st March 2021, the Company has incurred total capital expenditure INR 197.46 Crores (previous year INR 122.19 Crores) with respect to these projects in GAs of Amritsar and Bhatinda and accounted the same as under in books of GGL for the year ended on 31.03.2021: - Property, Plant and Equipment and intangible assets - INR 119.53 Crores (previous year INR 58.62 Crores) - Capital Work in Progress (including capital inventory) - INR 77.93 Crores (previous year INR 63.57 Crores) Until the transfer / purchase of CGD Business from GSPL to GGL, GSPL had contracted with GGL to use assets owned by GGL for limited period of time in exchange of facility service charges (equal to depreciation and all operating expenses) being paid by GSPL. Accordingly, GGL has recovered the operating expenditure amounting Rs. 5.79 Crores (Previous year Rs. 2.56 Crores) and facilitation fees income of Rs. 2.73 Crores (Previous year Rs. 0.21 Crores) from GSPL during the year for use of these assets.

STATEMENT ON COMPLIANCES OF APPLICABLE SECRETARIAL STANDARDS

Your Directors hereby confirm that during the year, the Company has been compliant with the applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.

CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014. Pursuant to provisions of Section 135 of the Companies Act, 2013, the Company has also formulated a Corporate Social Responsibility Policy which is available on the website of the Company at http://www.gujaratgas.com/corporate-governance/policies/. The Annual Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed herewith as Annexure - 2 to this Report.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL Appointment and Resignation of Directors

Shri Anil Mukim, IAS, Chief Secretary, Government of Gujarat had been appointed as Additional Director and Chairman with effect from 1st April, 2020. His appointment had been regularized by the shareholders in the 8th AGM held on 24th September, 2020. Dr. J.N. Singh, IAS (Retd.) has ceased to be the Director and Chairman of the Company with effect from 1st April, 2020, as per Resolution of Energy & Petrochemicals Department, Government of Gujarat. Your Directors wish to place on record, appreciation for the services rendered by him as the Director and Chairman of the Company.

Dr. Manjula Subramaniam, IAS (Retd.) had been appointed as Independent Woman Director by the Board of Directors w.e.f. 28/08/2020 to hold office for the period of 5 years effective from 28/08/2020. Her appointment was subsequently approved by the Shareholders in the 8th Annual General Meeting held on 24th September, 2020. Shri Milind Torawane, IAS, will retire by rotation and it is proposed to reappoint him as the Director of the Company in the ensuing 9th Annual General Meeting. Dr. Rajiv Kumar Gupta, IAS, Additional Chief Secretary, Industries and Mines Department, Government of Gujarat had been appointed as Additional Director with effect from 5th July, 2021 in place of Smt Sunaina Tomar, IAS. It is proposed to appoint Dr. Rajiv Kumar Gupta, IAS at the ensuing 9th Annual General Meeting.

Prof. Yogesh Singh and Shri Bhadresh Mehta being qualified and eligible for appointment as Independent Directors in the Company in accordance with provisions of Section 149, 152 read with Schedule IV and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014, were appointed by the Board of Directors for first tenure of 5 years with effect from 15th August, 2021, subject to approval of shareholders at 9th Annual General Meeting. It is proposed to appoint Prof. Yogesh Singh and Shri Bhadresh Mehta as Independent Directors in the ensuing 9th Annual General Meeting.

Smt. Sunaina Tomar, IAS has ceased to be the Director of the Company with effect from 5th July, 2021, on account of her transfer from Energy and Petrochemicals Department, Government of Gujarat. Your Directors wish to place on record, appreciation for the services rendered by her as the Director of the Company.

Prof. P.K. Sinha and Prof. Vishal Gupta have ceased to be Independent Directors of the Company with effect from 15th August, 2021, on account of expiry of their second tenure as Independent Directors of the Company. Your Directors wish to place on record, appreciation for the services rendered by them as Independent Directors of the Company.

A brief resume of the Directors to be appointed at the ensuing Annual General Meeting, nature of expertise in specific functional areas and details regarding the Companies in which the Directorship is held together with the Membership / Chairmanship of Committees of the Board is given in the Explanatory Statement forming part of the Notice of the 9th Annual General Meeting.

DIRECTORS INDEPENDENCE

Pursuant to the provisions of Section 149 (6) of the Companies Act, 2013, the Independent Directors of the Company have given confirmation/declaration to the Board that they meet with the criteria of Independence and are Independent in terms of Section 149 (6) of the Companies Act, 2013. Further, they have also given the confirmations on independence as per provisions of Regulation 16(1)(b) and 25 (8) of the Listing Regulations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, the performance evaluation of the Board, Committees and individual Directors for FY 2020-21 was carried out as per the terms and conditions of their appointment based on the various parameters.

MEETINGS OF THE BOARD OF DIRECTORS

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business. The Board / Committee Meetings are pre-scheduled to enable the Directors to plan their schedule and to ensure meaningful participation in the Meetings. However, in case of a special and urgent business need, the approval is taken by passing resolutions through circulation to the Directors, as permitted by law, which are noted in the subsequent Board/Committee Meetings.

During the period beginning from 1st April, 2020 up to 31st March, 2021, 4 (four) Board Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.

AUDITORS

As your Company is a Government Company, the Statutory Auditors are appointed by the Comptroller & Auditor General of India (C&AG). Accordingly, the C&AG had appointed M/s. S. R. Goyal & Co., Chartered Accountants as the Statutory Auditors of the Company for the Financial Year 2020-21. C&AG has carried out supplementary audit of the Financial Statements of your Commpany pursuant to provisions of Section 143 (6) (a) of the Companies Act, 2013. The C&AG has issued the Nil Comment Report on the Financial Statements of the Commpany for the FY 2020-21.

ANNUAL ACCOUNTS

The Audit Committee at its Meeting held on 1st June, 2021, approved the Financial Statements for the Financial Year ended on 31st March, 2021 and recommended the same for approval of the Board which had been subsequently approved by the Board of Directors at its meeting held on 1st June, 2021.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s Manoj Hurkat and Associates, Practising Company Secretaries to conduct the Secretarial Audit of the Company for the Financial Year 2020-21. The Report of Secretarial Auditor on Company's Secretarial Audit for the Financial Year 2020-21 is enclosed herewith as Annexure-3 to this Report. The Secretarial Audit Report is self explanatory in nature.

COST AUDITOR

Your Company is required to carry out Cost Audit pursuant to Section 148 of the Companies Act, 2013, read with the Companies (Cost Records and Audit) Rules, 2014. The Board of Directors has on the recommendation of the Audit Committee appointed M/s Ashish Bhavsar & Associates, Cost Accountants, as the Cost Auditor to audit the Cost Accounts of the Company for financial year 2021-22 on remuneration of Rs. 1,30,000/- (Rupees One Lac Thirty Thousands only) + GST and out of pocket expenses.

The Cost Audit Report for FY 2020-21 will be submitted to the Central Government in the prescribed format within stipulated time period. As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in General Meeting for their ratification. Accordingly, the necessary resolution seeking Member's ratification for the remuneration payable to the Cost Auditors for FY 2021-22 is included in the Notice convening the 9th Annual General Meeting.

Risk Management

The Company has a well-defined Risk Management Framework for reviewing the major Risks and has adopted a Business Risk Management Policy. Further, pursuant to the requirement of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has constituted a Risk Management Committee inter-alia to monitor the Risk Management Plan of the Company.

Internal Control System

The Company has a proper and adequate system of Internal Controls commensurate with its size of operations and nature of business. These are regularly tested and certified by Auditors. Significant audit observations of audit team and follow up actions thereon are reported to the Audit Committee. The details about the identification of elements of Risk and Internal Control Systems are provided in detail in the Management Discussion & Analysis Report forming part of this Board's Report.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls, with reference to financial statement. The internal financial controls have been documented in the business processes. Such controls have been assessed during the year under review and were operating effectively.

VIGIL MECHANISM

The Company has established a Vigil Mechanism for Directors, Employees to report their genuine concerns, details of which have been given in the Corporate Governance Report forming part of this Boards' Report.

HEALTH, SAFETY AND ENVIRONMENT (HSE)

Health, Safety and Environment (HSE) is a core value in GGL. GGL believes that outstanding business performance requires outstanding HSE performance. GGL recognizes that HSE is everyone's responsibility and every individual has a duty to intervene and prevent unsafe actions and to reinforce safe behaviors.

GGL has established its Quality, Occupational Health, Safety & Environment (QHSE) management system with reference to international standards ISO 9001:2015, ISO 14001:2015 & OHSAS 18001:2007 and was certified by a third party certification body after rigorous certification audit in 2018 along with periodic audits in successive years 2019 & 2020. Recently GGL has made the transition of its Occupational Health & Safety (OH&S) management system from OHSAS 18001 to new ISO standard 45001:2018 and successfully completed its recertification audit as per ISO 9001:2015, ISO 14001:2015 & ISO 45001:2018. The certifications demonstrate sustenance and company's continued commitment to quality, health, safety and environment management and customer satisfaction which is the key to sustainable business performance. GGL ensures that all management decisions reflect its Quality, Health, Safety & Environment (QHSE) intentions and QHSE management systems reflect best industry practices and are properly resourced. GGL aims to be an industry leader in City Gas Distribution business through its QHSE performance.

GGL recognizes that the protection of the health and safety of all those involved in its operation and public at large and protection of the environment is the prime responsibility of company and its' management at every level. GGL has embarked into new areas in terms of geography with inclusion of new Geographical Areas in the states of Punjab, Haryana, Madhya Pradesh & Rajasthan and into new business areas in terms of faster reaching customers in our operational areas by supplying of Natural Gas using regasification of LNG, decompression of CNG for areas where pipeline laying project may take significant time. GGL takes extra HSE precautions for all such new areas of geography and business. Risk assessment through safety engineering studies has been at the fore-front of all such projects where we conduct studies like Hazard Operability (HAZOP), Hazard Identification (HAZID), Hazardous Area Classification (HAC) and Quantitative Risk assessment (QRA), Escape Muster Evacuation & Rescue Analysis (EMERA) for all types of Gas installations at the planning stage itself and compliance to recommendations of these studies so that risks can be mitigated. GGL assets have been designed, constructed, commissioned, operated and maintained, such that the risks to personnel are reduced to as low as reasonably practicable (ALARP).

Liquefied Natural Gas (LNG) is natural gas, predominantly methane (CH4) that have been liquefied for ease of storage or transportation. In absence of natural gas source/tap-off point in proximity of the remote areas, GGL has commissioned Gujarat's first LNG/LCNG hub at Rajpipla, Narmada located 20 KM from Statue of Unity (SoU). Liquefied Natural Gas (LNG) is being transported through Cryogenic Road Tanker from source LNG Terminal to GGL LNG /LCNG Stations. This LNG is pressurized & re-gasified through ambient vaporizers for dispensing to customer vehicles as automobile fuel and Piped natural gas to domestic commercial & industrial customers on priority. GGL has taken utmost precaution in establishment of this LCNG station, in terms of quality, safety & environmental compliance. GGL has carried out safety engineering studies such as HAZOP, QRA, EMERA & HAC at planning stage along with implementation of their recommendation to reduce and control the risks. GGL conducts its business in a safe and responsible manner and ensures compliance with the all legal and regulatory requirements. Compliance assurance of the same is confirmed through internal audits / inspections with respect to all applicable PNGRB regulations and ISO standards covering all geographical areas of GGL every year including this financial year. GGL also conducts periodic compliance audits through PNGRB approved third party inspection agency. The safe delivery of projects and safe operations of assets is a critical success factor for the company's business. GGL sets HSE targets and closely monitors it to achieve continual improvement in QHSE performance.

GGL recognizes that leadership commitment is fundamental for continual improvement in HSE performance. GGL management team members review HSE performance on regular basis. GGL is committed to protect safety, health and well-being of people working for the organization. Lost Time Injury Frequency (LTIF) is the industry standard key indicator which is used to measure GGL's occupational safety performance. GGL has achieved Lost Time Injury Frequency of 0.321 for the FY 2020-21. Total man-hours of GGL in FY 2020-21 is 21.823 Million. GGL, as a responsible organization, recognizes and understands the various global challenges with respect to environmental degradation and climate change. Building awareness among the employees and community about these challenges is an effective way of addressing these challenges. GGL raises the awareness through various activities like knowledge sharing programs, quiz, various other competitions, etc. throughout the entire organization as well as sapling plantation drives. GGL also educates and influences various third-party utility companies, authorities and their contractors who undertake digging activities on or near the underground GGL gas pipeline network. This is done to focus on the safety risks and environmental impact of the release of Natural gas which can occur as a result of damaging GGL's natural gas pipelines while digging/excavation operations. The third parties are urged to dial in to GGL to confirm the location prior to starting any digging/excavation activities so that damage to Natural gas pipeline network can be prevented.

GGL has a well-developed and certified Emergency Response and Disaster Management Plan through PNGRB approved Third Party Inspection agency (TPIA) for each of its operational Geographical Areas. GGL conducts mock-drills at defined intervals to check adequacy of preparedness against various anticipated emergency scenarios across all locations. In FY 2020-21, GGL carried out 102 Level-1 Mock-drills, 23 Level-2 Mock-drills & 11 Level-3 Mock-drills including participation in the offsite mock drills organized by District authorities. GGL has well defined Lifesavers rules for all the critical activities and monitors lifesaver compliance. In FY 2020-21, GGL has achieved close to 94% compliance to lifesavers rules.

To improve HSE performance, various HSE initiatives and programs are implemented as part of HSE improvement plan. In FY 2020-21, GGL has achieved more than 94% compliance to its HSE improvement plan.

GGL always ensures that safety training programs are conducted periodically for employees and contractor staff which includes basic safety, practical fire-fighting, first aid, defensive driving and other technical competency trainings in various areas such as plumbing, CNG filling, Welding, Working at height etc. More than 628 Safety & Technical competency training programs have been conducted during FY 2020-21.

GGL organizes various safety awareness programs including awareness regarding Natural Gas related safety for its customers, general public, employees, contractors and other stakeholders such as third-party utility. Around 1058 safety awareness programs have been conducted for employees and contractors during FY 2020-21. Around 305 Natural Gas safety awareness program have also been conducted for general public, customers and other utility companies.

GGL has also established a system for evaluating contractor performance on monthly basis. Quality & HSE performance has been made an essential part of this performance evaluation with pre-defined key indicators. GGL conducts monthly online HSE Quiz based on monthly HSE focus area to raise awareness amongst employees across GGL. In the last quarter of this financial year, GGL decided to focus on few key areas identified based on incident areas and major activities undergoing: Jan 2021: Driving Safety including CNG Transportation Feb 2021: Excavation Safety Mar 2021: Lifting Safety Various initiatives including display of posters focusing on safe practices, awareness sessions with employees, online quiz, onsite briefing sessions and spot quiz for contractors' staff. With an intention to motivate and foster a positive HSE culture and step-up HSE-AI compliance and performance, GGL has put in place HSE reward and recognition scheme to acknowledge significant HSE contribution of employees and contractor staff and to boost their confidence. Under this scheme Best HSE contributors among employees and contractor staff are identified on monthly basis at each geographical area and are rewarded by GA management during monthly HSE committee meeting. Along with that every month GGL recognizes and rewards persons reporting Best Hazard & Best Near miss carefully selected based on quality and safety criticality and also identifies Best HSE contributor amongst all employees in every quarter and entire financial year for each operations area/corporate office.

GGL encourages participation and involvement of its employees and contractor staff in HSE related activities through monthly HSE committee meetings, Hazard and Near miss reporting, monthly quiz, risk assessment and numerous safety awareness programs. GGL, being a prudent organization, celebrates various HSE related events like National Safety Week, Road Safety Week and World Environment Day. Under these umbrella, GGL organizes various initiatives such as display of custom banners, pledge ceremony, quiz and number of awareness sessions etc. with an aim to involve employees and contractors and enhance their awareness regarding importance of HSE and related best practices.

GGL operations are driven by the goal of zero injuries, with the aim to ensure that every individual working for and on behalf of the company returns home safely at the end of each working day.

On the onset of Corona virus pandemic and hard time of lockdown across country, GGL being a responsible company and as an essential service has continued its operations with reduced staff at field & offices and rest working from home with support of information technology to ensure uninterrupted supply of Piped Natural Gas (PNG) to its residential, commercial and Industrial customers and to ensure continuity of its CNG operation. To safeguard the life of its employee, contractor staff, customers and other stakeholders against COVID-19, GGL has developed and implemented various guidelines for precautions to be taken against COVID-19, while continuing emergency and customer services operations, in line with various orders & advisories released by Ministry of Health & Family Welfare and Ministry of Home affairs. During these times to raise the awareness about precautions against COVID-19, GGL has developed & displayed various posters and conducted awareness sessions. GGL is ensuring compliance with the guidelines at offices and operation & project sites including travel.

Gujarat Gas Ltd Company Background

Gujarat Gas Ltd Company Management

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