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57th Annual Report 2020-219CORPORATE OVERVIEWCopierSpecialtyWe produce and offer an array of diverse officedocumentation and multi-purpose papers from economyto premium grades which are suited for both personal andcommercial use. We leveraged Elemental Chlorine Free(ECF) Pulp technology to produce superior quality and highbrightness and premium multi-purpose paper. We offer ourproducts through various well-renowned brand Reflection.We produce and offer specialty grade products thatare customised to suit specific and diverse range ofapplications. Through our offerings we ensure superiorconverting performance, excellent finish quality and goodaesthetic appeal.Application:High Volume photo copyingUsed in all types of Laserjet, Inkjet printers & Fax machinesHigh quality colour printingApplication:Wedding Card InsertsInvitationsDetergent CakeWrapperPoster PrintingPaper CupsCard Covers / EnvelopesCupstock BottomOther Packing SolutionsThermal PaperSoap Wrapper (OuterWrapper)Carbonless PaperChromo Paper

Andhra Paper LimitedTRUSTED LEGACY10HOW WE CREATE VALUEInputs97,5222,41,000 MT Paper CapacityShareholders fundlakh2 manufacturing locationsRs.95,085lakhPlant, Property & EquipmentHuman Capital4,843Natural Capital2,974571 lakhNo. of total employeesNo. of temporary employeesSaplings & Seedlings distributedthrough Farm-Forestry initiativesRs.1,615lakhSpent on Environment initiativesSocial CapitalRs.418lakhCSR spentCENAMROFInspiredPERManufacturing CapitalSustainingTSCUDORPFinancial CapitalInnovativeSDGs Covered

57th Annual Report 2020-2111CORPORATE OVERVIEWOutcomeInvestingFinancial ElakhHouseholds benefitedManufacturing Capital1.65 lakh MT(0.17)%Paper ProductionROCEFiber Source6,000 lakhEBITDAPATSocial Capital96,085 lakhPlant, Property & EquipmentHuman CapitalImproving52%Employees undergone safety &skill upgradationRs.14,298lakhoSpent as employee benefitexpenditure0.25Lost Workdays Incidence Rate(LWIR)Natural Capital5,22,300 MT 37%Wood produced from saplings& seedlings distributed by theCompany4%Improvement in energyconsumption from Bio-genic sourcesReduction in Air-Emissions2%Improvement in solid wasteutilisation14%Improvement in Fibre efficiencyETANPLur

TRUSTED LEGACYAndhra Paper Limited12BUILDING A STRONG WORKFORCEAt Andhra Paper, we believe that our humanresources are the key to our success. Thus, weconstantly invest towards building our humanresource by attracting and retaining diverse andtalented people. We constantly emphasize oncreating and maintaining a safe and inclusive workenvironment in which our employees have theopportunities to develop, expand their knowledgeand reach their full potential.4,843Employees across our operation2,567Employees undergone Safety & SkillUp-gradation trainingHealth & SafetyWe hold the safety of our employeesas the important aspect of our corefunctionality and have taken the bestpossible measures to ensure their wellbeing and security. Our leadership teamhas put in place commendable safetyprograms which emphasises on constanttraining & certifications. Our employeesare consistently provided with the toolsand facilities to empower themselves andbe responsible for their own safety and oftheir colleagues. For our operating staffincluding mill employees and workmen,we focused on safe isolation for which wedeveloped a robust safety programme.We are regularly updating andmaintaining our safety systems, makingsure that there are no irregularities. Webreak down our safety priorities andrationalise whether each of them are stillrelevant or need to undergo a changeof outlook. As the way of life for all of usvaries over time, we are also adding newprocesses which reflect these changesand adjust them to suit our current needsfor health and safety.

57th Annual Report 2020-21CORPORATE OVERVIEW13Employee engagementThe Company’s agenda for engagingand developing its employees includesinitiatives to attract, develop and retaintalent. The key focus areas includediversity and inclusion, successionplanning, developing a talent pool forcritical positions, quality of life programsand leadership development.The Company has taken a professionalapproach to industrial relations. TheCompany continued to treat people withdignity and respect as well as upheldimportant principles of labour relations.Manufacturing systemOur Manufacturing Excellence (ME)system provides operating frame workfor improving efficiency and productivityof our operations and covers all aspectsof the company resources such asEnvironment, Health, Safety, People,Cost reduction, Reliability and Capital. Toachieve the operational excellence, wetrain and certify expertise in techniquesusing 6-Sigma, Lean, RCFA and processimprovement. We have 76 certifiedgreen and black belts who take onimprovement projects to make ouroperations better, while another 64trained yellow belts inculcate lean cultureinto everyday practices.

TRUSTED LEGACYAndhra Paper LimitedSUSTAINABILITY AT COREAt Andhra Paper, we are committed to ensureresponsible use of natural resources andprotection of the environment. Over the years,we have strived to continuously reduce ourenvironmental footprint and ensure efficient use ofscares resources while protecting ecosystem andthe natural habitat.At Andhra Paper, we are committedto ensure responsible use of naturalresources and protection of theenvironment. Over the years, we havestrived to continuously reduce ourenvironmental footprint and ensureefficient use of scares resources whileprotecting ecosystem and the naturalhabitat.Our methodConserve water resources toensure availability for desired usesby recycling techniquesReduction of solid and otherlandfill wastes by reuse, recyclingand give to beneficial end usersfor their manufacturing usages.Regular checks, evaluation andmonitoring of environmentalperformance indicators.Establishment and effectiveimplementation of ISO Qualityand Environmental Managementsystems.Farm-ForestryOur Company’s farm forestry programgenerates more wood on the earththan we consume; in fact, at more thandouble the rate of consumption. Ourinvestment towards responsible farmforest stewardship ensures a healthy andproductive forest eco-system.The Company has begun execution of itsfiber strategy to increase procurementwithin a radius of 150 KM of themills. In this direction, the Companyinitiated partnerships with leadingforestry institutions to complement itsforestry R&D program. The Company iscommitted to increase farmers’ incomeby increasing per unit yield from theirpulpwood plantations.Research and developmentOur research and developmentprojects have helped in ensuring highersurvival percentage of seedlings,higher productivity per unit area andreduction in the rotation cycle. In orderto be environmentally-friendly, we haveeliminated the traditional practices ofpolybag nursery techniques, and otherlow cost planting techniques havebeen introduced. Your company hasalso introduced high yielding, diseaseresistant Casuarina clonal saplings, whichensures additional silvicultural gainsfor the farmers. The clonal researchactivities have been extended to the millcatchment areas of Andhra Pradesh inorder to meet the growing demand of thebeneficiaries.14

57th Annual Report 2020-21Our Sustainability Targets for 2030At Andhra Paper, we remain committed in our endevour toreduce carbon footprint and contribute to building a sustainablefuture. As one of India’s largest pulp and paper manufacturers,we recognize our environmental responsibilities. Aligned toour long-term goals, we embarked upon an ambitious journeyto identify global trends and material issues that impact ourbusiness. Our long term sustainability goals termed as “Vision2030 Goals” are built around our key growth drivers:(a) Sustaining fiber source(b) Investing in people and(c) Improving our planet15CORPORATE OVERVIEWOur goals to reduce / improve onkey parameters by 203020%15%30%6%EnergyWater Stewardship20%GHG emissions34%Air EmissionsEfficient QualitySolid waste75%Fiber efficiency

TRUSTED LEGACYAndhra Paper LimitedOUR RESPONSIBLE INITIATIVESAt Andhra Paper, we strive to accomplish theinclusive development of our communities throughour CSR initiatives. We are continually refining ourprograms and seeking opportunities to make apositive impact in the communities where we operate.Social development initiatives of the company arecarried out predominantly in and around the mills atRajahmundry and Kadiyam.The triple bottom line of the company are Planet-ProfitsPeople, wherein People is not limited to our employees,customers, shareholders but includes members of ourcommunity - because of whom we are, will be!16

57th Annual Report 2020-21CORPORATE OVERVIEW17Key Highlights for FY2020-21CSR Vision6000 householdsTo make positive contributions tocommunities around the Company’smanufacturing facilities and farmforestry areas.15 villages and 1 townNumber of families benefitted through the CSR initiativesNumber of villages and towns impacted through our CSR initiatives9,29,681 kilo litres( i.e. 2547 kilo litres / day )of Safe drinking water supplied to communities under social accountabilityCSR MissionTo address and engage in the areas ofContributions to the Community during Covid-19 pandemicDue to the impact of the Covid-19 pandemic, many communities were adverselyaffected and requiring relief. Being a responsible citizen, we did our part to uplift thecommunities during these challenging times.EducationHealth & WellnessCommunity EngagementCSR GoalTo continue to impact our communityin a positive way leading to inclusivegrowth and development. To be seenby every community member as anasset to the town and village whereour Mills are functioning – not justas an employer but as a responsiblecorporate citizen.Rs.21 lakhRs.10 lakhWorth of essential food material supplied to the needy at RajahmundryDonated to East Godavari District Collector to undertake COVID-19 relief measures

TRUSTED LEGACYAndhra Paper Limited18BOARD OF DIRECTORSMr. Shree Kumar BangurMr. Virendraa BangurMr. Praveen P. KadleMr. Adhiraj SarinMr. Sudarshan V. SomaniMr. Arun Kumar SurekaMr. Rajendra JainMs. Veni MocherlaMr. Saurabh BangurChairman & Managing DirectorIndependent DirectorNon-Executive DirectorMr. Anish T. MathewDirector - Commercial &Chief Financial OfficerVice ChairmanIndependent DirectorIndependent DirectorIndependent DirectorIndependent DirectorJoint Managing Director

57th Annual Report 2020-2119CORPORATE OVERVIEWLEADERSHIP TEAMMr. Anish T. MathewDirector - Commercial &Chief Financial OfficerMr. Sreenivas PamidimukkalaVice President (Information Technology)Mr. Atanu ChakrabartiMr. Sura Reddy MallidiSr. Vice President(Sales & Supply Chain)Sr. Vice President (Mill Operations)Mr. Shyam SrivastavaMr. Aravind MattaVice President (Purchase & Forestry)Company Secretary &Vice President (Corporate Affairs)

TRUSTED LEGACYAndhra Paper Limited20CORPORATE INFORMATIONRegistered OfficeStatutory AuditorsCorporate OfficeRajahmundry – 533 105East Godavari DistrictAndhra Pradesh, IndiaPhone: 91 883 247 1831 to 1834Fax: 91 883 246 1764Deloitte Haskins & Sells,Chartered Accountants,HyderabadWorksNarasimha Murthy & Co.,Cost Accountants,HyderabadKrishe Sapphire Building,8th Floor, 1-89/3/B40 to 42/KS/801,Hi-tech City Main Road,Madhapur,Hyderabad – 500081Telangana, IndiaPhone: 91 40 6810 1200Fax: 91 40 6810 1255Unit: RAJAHMUNDRYRajahmundry – 533 105East Godavari District,Andhra Pradesh, IndiaPhone: 91 883 247 1831 to 1834Fax: 91 883 246 1764Unit: KADIYAMIndustrial Area,M R Palem – 533 126Kadiyam Mandalam,East Godavari District,Andhra Pradesh, IndiaPhone: 91 883 245 4651Fax: 91 883 245 3538CIN: L21010AP1964PLC001008Cost AuditorsInternal AuditorsKPMG,Chartered Accountants,HyderabadSecretarial AuditorsD. Hanumanta Raju & Co.,Company te Bank of IndiaAxis Bank LimitedHDFC Bank LimitedStandard Chartered Bank

57th Annual Report 2020-2121STATUTORY REPORTSMANAGEMENT DISCUSSION & ANALYSISForward looking statementsIn this Annual Report, we have disclosedforward looking information to enableinvestors to comprehend our prospectsand take informed investment decisions.This report and other statements - writtenand oral - that we periodically make,contain forward looking statements thatset out anticipated results based on themanagement’s plans and assumptions.We have tried wherever possible toidentify such statements by using wordssuch as ‘anticipate’, ‘estimate’, ‘expects’,‘projects’, ‘intends’, ‘plans’, ‘believes’,and words of similar substance inconnection with any discussion of futureperformance. We cannot guaranteethat these forward looking statementswill be realized, although we believewe have been prudent in assumptions.The achievement of results is subject torisks, uncertainties and even inaccurateassumptions. Should known or unknownrisks or uncertainties materialize, orshould underlying assumptions proveinaccurate, actual results could varymaterially from those anticipated,estimated or projected. Readers shouldbear this in mind. We undertake noobligation to publicly update any forwardlooking statements, whether as a resultof new information, future events orotherwise.Global EconomyThe year 2020 has been an unparalleledyear in modern times. The COVID-19pandemic impacted human lifeextensively across the globe, and led tocurtailment of economic activities, theimpact of which has resulted in significantcontraction of the global economy. Theslowdown across economies witnessedin 2019 exacerbated further in 2020 bythe shock delivered by the pandemic.As a result, the global GDP is believedto have contracted by 3.3% in 2020,with all major economics moving intonegative territory. The economic upheavalcould have been much more severe hadit not been for the timely response fromcentral banks and governments globally.The supportive measures undertakenby governments, globally, ensured easyavailability of funding and support forboth private and public consumption.This support has been instrumental inthe recovery in the last two quarters ofthe calendar year as compared to thesignificant contractions observed inthe first two quarters. The sequentialrecovery in global trade coupled withthe easy liquidity conditions have alsoled to a sharp rise in commodity prices,especially in the last quarter of 2020. Thishas been further aggravated by largescale disruptions in the global supplychain, with shipping line capacities andcontainer availability posing a majorchallenge.OutlookAccording to IMF economic outlook,April 2021 report, world GDP to expandby 6% in 2021 after contracting by 3.3%in 2020. The emerging markets andthe developing countries’ economy isexpected to grow by 6.7% YOY, whichare the major drivers for paper demand.Whereas, the developed countries’economy is expected to grow by 5.1% in2021 after contracting by 4.7% in 2020.Indian EconomyIn line with the global economy, Indiawitnessed major economic disruptions inFY 2020-21, as the outbreak of COVID-19perversely impacted human healthand safety of the country’s inhabitants.This prompted the government toundertake one of the world’s tightestlockdowns, bringing manufacturingand trade activities to a screechinghalt. Prolonged lockdown exacerbatedexisting vulnerabilities of the countryincluding the weakened financialsector, private investments, liquidityconstraints and consumption demand.An accommodative monetary policyfrom the Reserve Bank of India (RBI) andfiscal policy interventions by the centralgovernment, coupled with the gradualreopening of the economic activitiesfrom June 2020, have led to a sequentialrecovery in economic output. India’seconomy contracted during the firsthalf of FY 2020-21, before returning topositive territory in third quarter of FY2020-21 with a growth of 0.4 per cent.GDP had seen revival, albeit marginally,as economic activities resumed after along and arduous lockdown and overallsentiment improved with the rollout ofvaccination drive.The recovery largely centered aroundthe formal part of the economy. Theinformal players, especially the Micro,Small and Medium-sized Enterprises(MSMEs) in many industries have takena disproportionately large hit. Inflationpicked up over the year, despitethe pandemic, primarily led by foodinflation and higher fuel taxes. On theexchange rate front, post the initial boutof depreciation in the Indian currencyin the beginning of the financial year,the currency has been relatively wellsupported on account of robust portfolioinflows in the economy as well as a bettercurrent account position.OutlookThe vaccination drive across the majoreconomies, including India, beginninglast quarter of FY 2020-21 has invigoratedthe much-needed stimulus for a sustainedrecovery of economic activities acrossthe globe. Almost all major centralbanks have pledged to continue anaccommodative monetary stance toreinforce the economic green shoots.Coupled with the base-effect, economicgrowth is expected to bounce backstrongly in FY 2021-22 on the globalas well as the domestic front. However,

TRUSTED LEGACYa lot would depend upon the pace ofvaccination, containment of pandemicand easing the restrictions on economicactivities. Given the resurgence of thevirus and the spread of infections, therehas been a re-imposition of restrictionson business activities in many states,which has again disrupted the demandmomentum which has had in the lastquarter of FY 2020-21. Adding to this,inflation in commodity prices has risensignificantly since the last quarter ofFY 2020-21, and continues to be onthe uptrend. The uncertain demandconditions and inflationary pressure,would place strong emphasis onmanaging the business in a dynamicmanner and altering operational prioritiesto suit the changing market conditions.Despite the challenges posed by thepandemic in current year, the outlookfor FY 2021-22 seems promising. Thisis largely attributed to mass vaccinationdrives, normalising business activities,the government’s thrust on revivinginfrastructure sector, revival in housingdemand backed by historically lowinterest rates, improving banking balancesheet and India’s increasing prominencein the global supply chain.Paper Industry OverviewGlobal Paper IndustryThe global consumption of paper andpaper products amounted to 399 millionMT in 2020[1]. Asia Pacific was the largestregion in the global paper productsmarket, accounting for 35% of the marketin 2020. North America was the secondlargest region, accounting for 26% of theg

CONTENTS 2-20 21-72 73-131 132-139 Corporate Overview Statutory Reports Financial Statements Notice We are Andhra Paper 2 Message from the Chairman 4 Making steady progress 6 Our Sustainable product offering 8 How we create value 10 Building a strong workforce 12 Sustainability at Core 14 Our responsible initiatives 16 Board of Directors 18 Leadership Team 19 Corporate Information 20