JAY BHARAT MARUTI LIMITED

(“the Company”)

DIVIDEND DISTRIBUTION POLICY

 DIVIDEND DISTRIBUTION POLICY

1. PREAMBLE

Securities and Exchange Board of India (“SEBI”) vide its Press Release 15/2021 dated
25.03.2021 makes it mandatory for the top 1000 listed entities based on their market
capitalization calculated as on March 31 of every financial year to formulate a Dividend
Distribution Policy under Regulation 43A of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 [“the Listing Regulations”], as amended from time to time.

In compliance with the provisions of Regulation 43A of the Listing Regulations the Board of
Directors of the Company at its meeting held on 29.01.2021, has approved and adopted the
Dividend Distribution Policy of the Company [“the Policy”].

This Policy shall be effective and applicable for dividend, if any, declared for the Financial Year
2021-22 and onwards.

2. OBJECTIVE

The Policy establishes the principles to ascertain amounts that can be distributed to equity
shareholders as dividend by the Company as well as enable the Company strike balance
between pay-out and retained earnings, in order to address future needs of the Company. This
Policy provides guidance for declaration of dividend and its pay-out by the Company. The
Board of Directors (the “Board”) will consider the Policy while declaring / recommending
dividend on behalf of the Company. The Policy is not an alternative to the decision of the Board
for recommending/declaring dividend, which takes into consideration all the relevant
circumstances enumerated hereunder or other factors as may be decided by the Board.

3. DEFINITIONS

a. “Act” means the Companies Act, 2013 and Rules made thereunder [including any amendments
or re-enactments thereof].

b. “Applicable laws” shall mean to include Companies Act, 2013 and Rules made thereunder,
[including any amendments or re-enactments thereof], Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015, [including any
amendments or re-enactments thereof], any other regulation, rules, acts, guidelines as may be
applicable to the distribution of dividend.

c. “Board” or “Board of Directors” shall mean Board of Directors of the Company, as constituted
from time to time.

d. “Company” shall mean Jay Bharat Maruti Limited.

e. "Dividend” includes any interim dividend; which is in conformity with Section 2(35) of the
Companies Act, 2013 read with Companies (Declaration and Payment of Dividend) Rules,
2014.

f. “Financial year” shall mean the period starting from 1st day of April and ending on the 31st day
of March every year.
g. “Free reserves” shall mean the free reserves as defined under Section 2 (43) of the Act.

h. Capital to Risk Assets Ratio (Capital Adequacy Ratio) shall mean the Percentage of Capital
Funds to Risk Weighted Assets/Exposures of the Company.

4. TYPES OF DIVIDEND

The Act deals with two types of dividend - Interim and Final.

a) Interim Dividend
Interim dividend is the dividend declared by the Board between two Annual General Meetings
as and when considered appropriate. The Board shall have the absolute power to declare
interim dividend during the financial year, as and when deemed fit. The Act authorises the
Board to declare interim dividend during any financial year outof the profits for the financial year
in which the dividend is sought to be declared and / or out of the surplus in the profit and loss
account.

Normally, the Board could consider declaring an interim dividend after finalization of quarterly
(or half yearly) financial statements.

b) Final Dividend
Final dividend is recommended for the financial year at the time of approval of the Annual
Financial Statements. The Board shall have the power to recommend final dividend to the
shareholders for their approval at the Annual General Meeting of the Company.

5. DECLARATION OF DIVIDEND

Subject to the provisions of the Act, dividend shall be declared and paid out of:

a) Profits of the Company for the year for which the dividend is to be paid after setting off carried
over previous losses and depreciation not provided in the previous year(s);

b) Undistributed profits of the previous financial years after providing for depreciation in
accordance with law and remaining undistributed.

c) Out of (a) and (b) both.

Before declaration of dividend, the Company may transfer a portion of its profits to reserves of
the Company as may be considered appropriate by the Board at its discretion.

In the event of inadequacy or absence of profits in any financial year, a Company may declare
dividend out of free reserves subject to the compliance with the Act.

6. CIRCUMSTANCES UNDER WHICH THE SHAREHOLDERS MAY OR MAY NOT EXPECT

DIVIDEND

The decision regarding Dividend pay-out is a crucial decision as it determines the amount of
profit to be distributed among shareholders and amount of profit to be retained in the business.
The circumstances under which the shareholders may expect dividend would depend upon
certain factors mentioned in Clause 7 below.
 7. FINANCIAL PARAMETERS

The Company is committed to deliver sustainable value to its stakeholders. The Company shall
strive to distribute an optimal and appropriate level of the profits among the shareholders in the
form of dividend. To keep investment attractive and to ensure capital appreciation for the
shareholders, the Company shall also endeavor to provide consistent return over a period of
time. While deciding on the dividend, micro and macro-economic parameters for the country in
general and the Company in particular shall also be considered.

Taking into consideration the below mentioned factors, the Board shall endeavor to maintain a
dividend pay-out.

8. FACTORS GOVERNING DECLARATION OF DIVIDEND

In addition to financial parameters, the circumstances for dividend pay-out decision depends on
various external and internal factors which shall considered By Board including:

Internal Factors:

i. Profitable growth of the Company and specifically, profit earned during the financial year as
compared with;
• Previous years; and
• Internal budgets,
ii. Cash flow position and availability and liquidity of Funds;
iii. Capital to Risk Assets Ratio (Capital Adequacy Ratio),
iv. Accumulated reserves;
v. Likelihood of crystallization of contingent liabilities, if any
vi. Creation of contingency fund
vii. Mergers and Acquisitions;
viii. Capital expenditure requirement
ix. Expansion / Modernization of the business;
x. Additional investments in subsidiaries/associates of the Company;
xi. Cost of raising funds from alternate sources;
xii. Cost of servicing outstanding debts;
xiii. Any other factor as deemed appropriate by the Board.

 External Factors:

i. Global conditions
ii. Business cycles;
iii. Economic Environment
iv. Cost of external financing
v. Applicable taxes including tax on dividend
vi. Industry outlook for the future years
vii. Inflation rate, and
viii. Changes in the Government policies, industry specific rulings and regulatory provisions.

9. MANNER OF UTILISATION OF RETAINED EARNINGS

Subject to the provisions of the Act and other applicable laws, retained earnings maybe
utilized in any of the following ways:-
 i. Capitalization of shares;
ii. Declaration of dividend - Interim or Final;
iii. Augmenting internal resources;
iv. Funding for Capex/expansion plans/acquisition;
v. Repayment of debt;
vi. General corporate purposes, including contingencies;
vii. Any other permitted use

10. GENERAL

Due regard shall be given to the restrictions/ covenants contained in any agreement entered
into with the lenders of the Company or any other financial covenant as may be specified under
any other arrangement/agreement, if any, before recommending or distributing dividend to the
shareholders.

11. PARAMETERS FOR VARIOUS CLASSES OF SHARES

Currently, the Company has only one class of shares - Equity Shares. There is no privilege
amongst Equity shareholders of the Company with respect to dividend distribution.

12. DISCLOSURE

This Dividend Distribution Policy shall be disclosed in the Annual Report of the Company and
on the Company’s website
If the Company proposes to declare dividend on the basis of any additional parameters apart
from those mentioned in the Policy or proposes to change the parameters contained in this
Policy, it shall disclose such changes along with the rationale for the same in the Annual
Report and on the Company’s website.

13. REVIEW / AMENDMENT

The Board of Directors shall have the right to modify, amend or change any or all clauses of
this Policy in accordance with the provisions of the Applicable laws/Acts/Regulations or
otherwise.
In case of any amendment(s), clarification(s), circular(s), etc. issued under any Applicable laws/
Regulations, which is not consistent with any of the provisions of this Policy, then such
amendment(s), clarification(s), circular(s), etc. shall prevail upon the provisions hereunder and
this Policy shall be deemed to be amended accordingly from the effective date as laid down
under such amendment(s), clarification(s), circular(s), etc.