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20 Microns Ltd.

BSE: 533022 Sector: Metals & Mining
NSE: 20MICRONS ISIN Code: INE144J01027
BSE 15:05 | 17 Jun 64.20 -2.25
(-3.39%)
OPEN

62.10

HIGH

66.75

LOW

62.10

NSE 14:54 | 17 Jun 63.80 -2.55
(-3.84%)
OPEN

66.00

HIGH

66.75

LOW

63.60

OPEN 62.10
PREVIOUS CLOSE 66.45
VOLUME 30439
52-Week high 74.80
52-Week low 24.50
P/E 11.46
Mkt Cap.(Rs cr) 227
Buy Price 64.20
Buy Qty 86.00
Sell Price 64.30
Sell Qty 778.00
OPEN 62.10
CLOSE 66.45
VOLUME 30439
52-Week high 74.80
52-Week low 24.50
P/E 11.46
Mkt Cap.(Rs cr) 227
Buy Price 64.20
Buy Qty 86.00
Sell Price 64.30
Sell Qty 778.00

20 Microns Ltd. (20MICRONS) - Director Report

Company director report

Dear Members

The Directors have pleasure to present their 33rd AnnualReport and the Financial Statements for the year ended March 31 2020.

Financial Results

The Company's standalone and consolidated financial performancefor the year ended March 31 2020 is summarized below:

[Rs. in Lakhs]

Standalone Consolidated
Particulars 2019-20 2018-19 2019-20 2018-19
Total Income 49766.57 43830.80 53198.23 48160.09
Profit before Depreciation Interest and Tax (PBDITA) 6644.49 6417.24 6859.60 7082.84
Interest for the year 2011.54 2085.99 2153.17 2189.99
Depreciation for the year 1118.73 937.29 1251.07 1046.77
Profit/(Loss) before tax and Exceptional item 3514.22 3393.96 3455.36 3846.08
Exceptional items - - - -
Profit/(loss) for the year Tax liability :- 3514.22 3393.96 3455.36 3846.08
Current Tax 921.11 1065.30 1025.58 1190.35
Deferred Tax 96.46 157.37 12.17 151.80
Prior period Tax - - - -
Net Profit/(Loss) for the year 2496.65 2171.29 2417.61 2503.94

DIVIDEND:

To conserve the resources your Directors have not recommended finaldividend during the year under consideration. The interim dividend of Re. 0.60 per sharedeclared by the Board of Directors shall be considered as the final dividend for FY20.Thus the total dividend for FY20 remains Re. 0.60 per equity share.

Transfer to Reserves

The Directors do not propose to transfer any amount to reserves.

State of Company's Affairs

During the year under consideration following financial developmentshave taken place -

- Revenue for the FY20 was Rs. 49766.57 Lakhs as against Rs.43830.79 Lakhs in FY19. The revenues posted registered a gradual growth since the companyhas been focusing on the organic growth value added products & robust price-mixeffect in business.

- For FY20 EBIDTA was at Rs. 6644.49 Lakhs with EBIDTA margin of13.35% marginally higher due to robust performance driven by healthy volumes and betterrealization along with sale of value added products contributing higher margins

- The PAT for FY20 stood at Rs. 2496.65 Lakhs compare to Rs.2171.28 Lakhs in FY19.

- Company's debt-equity ratio came down from 0.64 in 2020and it was 0.77 in 2019.

- Net Worth of the Company is increased to Rs. 17340.66 Lakhs ason March 31 2020 as compared to Rs. 15208.23 Lakhs as on March 31 2019.

Investors Education and Protection Fund

During the year dividend amounting to Rs. 55627.20 that had not beenclaimed by the shareholders for the year ended March 31 2012 was transferred to thecredit of Investor Education and Protection Fund as required under Section 124 and 125 ofthe Companies Act 2013. Shareholders are required to lodge their claims with theRegistrar Cameo Corporate Services Ltd. for unclaimed dividend. Pursuant to theprovisions of Investor Education and Protection Fund (Uploading of Information regardingunpaid and unclaimed amounts lying with Companies) Rules 2012 the Company has uploadedthe details of unpaid and unclaimed amounts lying with the Company as on 31.03.2020 on thewebsite of the Company at web link - https://www.20microns.com/ unpaid-dividend-deposit/.

Material Changes and commitments affecting financial position betweenthe end of the financial year and the date of report

Due to outbreak of COVID-19 pandemic globally and consequent lockdownimposed by the Government of India from March 25 2020 to curb its wide spread a massiveeconomic disruption and social distress has been witnessed in India. With the opening ofdomestic and international market post lockdown business started improving in a slow andgradual manner. Though there was no significant impact on the business of the Company forFY2020 but considering the wide spread and varying degree of intensity of pandemic acrossthe countries where 20ML operates the economic impact during FY2021 seems evident acrossthe industry. The management is meticulously analyzing the situation and gettingadequately prepared to emerge stronger in the longer term.

Corporate Governance Report and Management Discussions & Analysis

As required by Schedule V(C) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a detailed report on Corporate Governance isgiven as a part of the Annual Report. The Company is in full compliance with therequirements and disclosures that have to be made in this regard. The Auditors'Certificate of the compliance with Corporate Governance requirements by the Company isattached to the Report on Corporate Governance.

A detailed report on Management Discussions and Analysis forms anintegral part of this report and also covers the consolidated operations and nature of ourbusiness.

Fixed Deposits

The Company has started accepting the unsecured fixed deposits onlyfrom the shareholders of the company pursuant to the provisions of Companies Act 2013 andRules made thereunder. The said Scheme was approved by you at your Extra-ordinary GeneralMeetings held on 24th May 2014 and amended in Annual General Meetings held on23rd September 2016 and 22nd September 2017.

As on 31.03.2020 outstanding Unsecured Fixed Deposits fromShareholders was Rs. 3091.95 Lakhs. Deposits amounting to Rs. 1739.64 Lakhs are due forrepayment on or before 31.03.2021.

The Company has not made any default in repayment of deposits orinterest due thereon.

The Company is liable to comply with the provisions relating toacceptance of deposits under the Companies Act 2013 and Rules made there-under and anyamendments made from time to time.

Subsidiaries Joint Ventures & Associates

Pursuant to Section 129(3) of the Companies Act 2013("Act") the consolidated financial statements of the Company and itssubsidiaries prepared in accordance with the relevant Accounting Standard specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 formpart of this Annual Report. Pursuant to the provisions of the said section a statementcontaining the salient features of the financial statements of the Company'ssubsidiaries in Form AOC-1 is given in Annexure A. Further pursuant to the provisions ofSection 136 of the Act the standalone financial statements of the Company consolidatedfinancial statements of the Company and the relevant consolidated financial statementsand separate audited financial statements along with other relevant documents in respectof subsidiaries are available on the website of the Company www.20microns.com with weblink https:// www.20microns.com/annual-reports-of-all-subsidiaries/. These documents willalso be available for inspection through electrobnic mode. During the FY 2019-20 thecompany is not having any associates and joint venture company.

Performance Highlights of Subsidiaries

As on 31.03.2020 the Company had 5 [Five] Subsidiaries viz. 20 MicronsNano Minerals Limited [20 M NANO]; 20 Microns SDN. BHD [20MSB] 20 Microns FZE [20MFZE]20 Microns Vietnam Company Ltd [20M Vietnam] and 20 MCC Pvt. Ltd. [20MCC].

During the year under review 20 M Nano reported consolidated revenuefrom operations of Rs. 5882.55 Lakhs and earned consolidated Net Profit of Rs. 211.31Lakhs. 20MSB reported total Revenue of Rs. 550.24 Lakhs and earned Net profit of Rs. 79.52Lakhs while 20MFZE having Total Revenue of Rs. 612.78 Lakhs and the Net Profit of Rs.52.23 Lakhs. 20M Vietnam reported the Gross Revenue was Rs.355.09 Lakhs and Net Profit ofRs. 7.09 Lakhs and 20MCC reported Total Revenue of Rs. 245.24 Lakhs and Net Loss of Rs.184.44 Lakhs.

Companies which have become or ceased to be Subsidiaries Associatesand Joint Ventures

During the FY 2019-20 no company ceased as subsidiary or associate orjoint venture of the company. For further analysis on the consolidated performanceattention is invited to the notes to the consolidated financial statements.

Particulars of Employees

The information as required under Section 197 of the Act read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are given in Annexure B which forms part of this report. Pursuant to Section 197(14) ofthe Act the details of remuneration received by the Managing Directors and CompanySecretary from the Company's subsidiary company during FY 2019-20 are also given inAnnexure B attached to this report. None of the employees listed in the said Annexure arerelated to any Director of the Company.

In terms of Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 we have to state that since there is no employeesfalling within the purview of the said requirements the same has not been annexedherewith.

Related Party Transactions

All related party transactions that were entered into during thefinancial year 2019-20 were on an arm's length basis and in the ordinary course ofbusiness. There are no material related party transactions made by the Company during theyear that required shareholders' approval under Regulation 23(4) of the ListingRegulations or Section 188 of the Act. All related party transactions are reported to theAudit Committee. Prior approval of the Audit Committee is obtained on a yearly basis forthe transactions which are planned and / or repetitive in nature.

Policy for determining material related party is available at linkhttps://www.20microns.com/wp-content/uploads/2019/12/20ML_Material-Related-Party-Transaction-Policy.pdf

Particulars of transactions with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is annexed in Annexure Chereto.

Extracts of Annual Return and Other Disclosures under Companies[Appointment and Remuneration] Rules 2014

As provided under Section 92 of the Act and rules framed thereunderthe extract of annual return in Form MGT-9 is given in Annexure D which forms part of thisreport. In compliance with section 134(3)(a) of the Act MGT 9 is uploaded on Companieswebsite www.20microns.com.

Conservation of Energy Technology Absorption Foreign ExchangeEarnings & Outgo

Information as per Companies (Disclosure of particulars in the Reportof Board of Directors) Rules 1988 relating to conservation of energy technologyabsorption foreign exchange earnings and outgo are given in Annexure - E forming part ofthis report.

Corporate Social Responsibility

In compliance with Section 135 of the Act the Company has undertakenCSR activities projects and programs as provided in the CSR policy of the Company and asidentified under Schedule VII to the Act.

The Board has framed a CSR Policy for the Company on therecommendations of the CSR Committee. The Report on CSR activities as required underCompanies (Corporate Social Responsibility) Rules 2014 including a brief outline of theCompany's CSR Policy total amount to be spent under CSR for the financial year anddetails of amount spent on CSR during the year is set out at Annexure – F formingpart of this Report.

As a part of CSR activities during the year under review 20 MicronsFoundation has focused on making people aware about Diabetes. People made acquainted withsymptoms of Diabetes precautions to be taken importance of regular check-up etc. Thiscampaign was carried out in State of Gujarat and Maharashtra. People were made understoodabout how to live life comfortably with Diabetes. Testing and Consultation was carried outat every location.

We have 95 numbers of Juvenile Diabetic patients and all are constantlyunder the watch of us. They are taken to most reputed senior doctors for advice and nowthey are settled with comfortable life. We have started recruiting/ accommodating suchpatients in doing work with our activity to reduce their fear of diabetes.

Every day JDP (Juvenile Diabetic Patients Type – 1) are coming toour center for support to have insulin Glucometer & Testing Strips calibration ofGlucometer requirement of Syringe Insulin Pen and needle for insulin Pen. We havearranged experienced specialized different doctors on daily basis for 2 to 3 hours totake care of JDP's and Type – 2 Diabetic patients. In case of critical cases wetake away the patient with well-known Dialectologists / Endocrinologists of Vadodara andtake advice and treatment at no cost. We have organized three times Free Eye Checkup Campfor Type-1 diabetic patients. During 2019-2020 we have organized Diabetes Checkup Camp intwo Schools of Vadodara known as Rami School - Subhanpura in August 2019 and ShardaPrathmik School – Gorwa Road Vadodara in September 2019. We have checked upapproximately 800 students of classes from 1st Standard to 10thStandard at FREE of Cost. Also we have addressed to all students in assembly hall and haveexplained the importance of Diabetes Checkup Camp. We have also educated them aboutdiabetes and its symptoms. Our organization is associated with Dia-Cone Ahmedabad.Majority of well-known hospitals of Vadodara including Government hospitals are awareabout our activities and recommending patients to us for further life time care.

On 24th November 2019 WORLD DIABETIC DAY function wasorganized at Faculty of Social Work Vadodara for Type-1 patients with parents. Thepatients have performed Dance and solo Mono acting.

Risk Management Implementation

The Company operates in a competitive environment and is generallyexposed to various risks at different times such as technological risks business risksoperational risks financial risks etc. The Board of Directors and Audit Committee ofDirectors of the Company periodically review the Risk of the Company so that theManagement controls the risk through properly defined network. The Company has a systembased approach to business risk management backed by strong internal control systems.

A range of responsibilities from strategy to the operations isspecified. A strong independent internal audit function at the corporate level carries outrisk focused audits across all businesses enabling identification of areas where riskmanagements processes may need to be improved. The Board reviews internal audit findingsand provides strategic guidance on internal control monitors internal control environmentwithin the Company and ensures that Internal Audit recommendations are effectivelyimplemented. The combination of policies and procedures adequately addresses the variousrisks associated with your company's businesses.

Internal Finance Control System Adequacy

The Company has established proper and adequate system of internalcontrol to ensure that all resources are put to optimum use and are well protected againstloss and all transactions are authorized recorded and reported correctly and there isproper adherence to policies and guidelines safeguarding its assets prevention anddetection of frauds and errors accuracy and completeness of the accounting records andtimely preparation of reliable financial disclosures processes in terms of efficienciesand effectiveness. The Company's internal control systems are supplemented by anextensive program of internal audit by an independent firm.

All the transactions are conducted using the IT interface and thebusiness processes are further audited by internal auditors.

The Company's internal control systems are also periodicallytested and certified by the internal auditors. The Audit Committee constituted by theBoard constantly reviews the internal control systems.

Vigil Mechanism / Whistle Blower Policy

The Vigil Mechanism of the Company which also incorporates a whistleblower policy has been approved and adopted by Board of Directors of the Company incompliance with the provisions of Section 177 (10) of the Companies Act 2013 andRegulation 22 of the Listing Regulations 2015.

The Whistle Blower Policy of the Company provides a mechanism foremployees / Board Members and others to raise good faith concerns about violation of anyapplicable law/ Code of Conduct of the Company gross wastage or misappropriation offunds substantial or specific danger to public health and safety abuse of authority orunethical behaviour and to protect the individuals who take such actions from retaliationor any threat of retaliation and also provides for direct access to the Chairman of theAudit Committee in exceptional cases. The functioning of the Vigil mechanism is reviewedby the Audit Committee from time to time. During the financial year under review theCompany has not received any complaints against any employees/ Board Members.

The policy of vigil mechanism may be accessed on the Company's weblink - https://www.20microns.com/wp-content/uploads/2018/02/Vigilence-policy.pdf

Prevention of Sexual Harassment at Workplace

The Company has adopted a policy with the name "Policy onPrevention of Sexual Harassment at Workplace". The policy is applicable for allemployees of the organization which includes corporate office branches depots andmanufacturing locations etc.

A Complaints Committee has also been set up to redress complaintsreceived on sexual harassment as well as other forms of verbal physical written orvisual harassment. During the financial year under review the Company has not receivedany complaints of sexual harassment.

The policy of Prevention of Sexual Harassment at Workplace may beaccessed on the Company's web link - https://www.20microns.com/wp-content/uploads/2018/06/Policy-on-Prevention-of-Sexual-Harrasment-at-Work-Place.pdf

Industrial Relations

During the year under review industrial relations remained harmoniousat all our offices and establishments.

General Shareholders Information

General Shareholder Information is given in the Report on CorporateGovernance forming part of this Annual Report.

Secretarial Standards

Your company has complied with the provisions of Secretarial Standardsissued by Institute of Company Secretaries of India.

Particulars of Loan Guarantees or Investments

Loans guarantee and investment covered under Section 186 of theCompanies Act 2013 form part of the notes to the financial statements provided in thisAnnual Report.

Selection and Procedure for Nomination and Appointment of Directors

The Company has a Nomination and Remuneration Committee("NRC") which is responsible for developing competency requirements for theBoard based on the industry and strategy of the Company. The Board composition analysisreflects an in-depth understanding of the Company including its strategies environmentoperations financial condition and compliance requirements.

The NRC makes recommendations to the Board in regard to appointment ofnew Directors and Key Managerial Personnel ("KMP") and senior managementemployees. The role of the NRC encompasses conducting a gap analysis to refresh the Boardon a periodic basis including each time a Director's appointment or re-appointmentis required.

Criteria for determining qualifications positive attributes andindependence of a Director

In terms of the provisions of Section 178(3) of the Act and Regulation19 of the Listing Regulations the NRC has formulated the criteria for determiningqualifications positive attributes and independence of Directors the key features ofwhich are as follows:

- Qualifications – The Board nomination process encouragesdiversity of thought experience knowledge age and gender. It also ensures that theBoard has an appropriate blend of functional and industry expertise.

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

- Independence - A Director will be considered independent if he/ she meets the criteria laid down in Section 149(6) of the Act the Rules framedthereunder and Regulation 16(1)(b) of the Listing Regulations 2015.

Evaluation of Board of Directors

The Board of Directors has carried out an annual evaluation of its ownperformance Board Committees and individual directors pursuant to the provisions of theAct and the Listing Regulations 2015.

The Board evaluated its performance after seeking inputs from all theDirectors on the basis of criteria such as the Board composition and structureeffectiveness of Board processes information and functioning etc. The performance of theCommittees was evaluated by the Board after seeking inputs from the committee members onthe basis of criteria such as the composition of committees effectiveness of committeemeetings etc. The above criteria are as provided by the Guidance Note on Board Evaluationissued by the Securities and Exchange Board of India.

Remuneration Policy

Pursuant to the provisions of Section 178(3) of the Act and Regulation19 of the Listing Regulations 2015 the NRC has formulated a policy relating to theremuneration for the

Directors Key Managerial Personnel (KMP) Senior Management and otheremployees. The philosophy for remuneration is based on the commitment of fostering aculture of leadership with trust. While formulating this policy the NRC has consideredthe factors laid down in Section 178(4) of the Act which are as under:

- That the level and composition of remuneration is reasonableand sufficient to attract retain and motivate Directors of the quality required to runthe company successfully;

- Remuneration to Directors KMP and Senior Management Employeesinvolves a balance between fixed and incentive pay reflecting short and long-termperformance objectives appropriate to the working of the Company and its goals.

Remuneration Policy of the Company is available at link https://www.20microns.com/wp-content/uploads/2019/12/20ML_Nomination-RemunerationPolicy_2019-.pdf

Remuneration for Independent Directors andNon-Executive-Non-Independent Directors

The Non-Executive Directors including Independent Directors are paidsitting fees for attending the meetings of the Board and Committees of the Board. As perthe Policy the overall remuneration (sitting fees and commission) should be reasonableand sufficient to attract retain and motivate Directors aligned to the requirements ofthe Company including considering the challenges faced by the Company and its futuregrowth imperatives. The remuneration should also be reflective of the size of the Companycomplexity of the business and the Company's capacity to pay the remuneration.

Within the ceiling of 1% of net profits of the Company computed underthe applicable provisions of the Act the Non-Executive Directors including IndependentDirectors were also paid a commission the amount whereof was recommended by the NRC andapproved by the Board and shareholders during FY 2019-20.

The basis of determining the specific amount of commission payable to aNon-Executive Director is related to his attendance at meetings role and responsibilityas Chairman or member of the Board / Committees and overall contribution as well as timespent on operational matters other than at the meetings. The shareholders of the Companyhad approved payment of commission to the Non-Executive Directors at the last AnnualGeneral Meeting held on 13th August 2019 for FY 2018-19 as determined andapproved by Board of Directors which shall be within ceiling of 1% of net profit of theCompany.

Board of Directors and meetings

The members of the Company's Board of Directors are eminentpersons of proven competence and integrity. Besides experience strong financial acumenstrategic astuteness and leadership qualities they have a significant degree ofcommitment towards the Company and devote adequate time to the meetings and preparation.

The Board meets at regular intervals to discuss and decide on Company /business policy and strategy apart from other Board business. Intimation of Board Meetingdate would be given in advance to help them plan their schedule and ensure meaningfulparticipation in the meetings. Only in case of special and urgent business if the needarises the Board's/ Committee's approval is taken by passing resolutionsthrough circulation or by calling Board/Board Committee meetings at shorter notice aspermitted by law.

The Company has complied with Secretarial Standards issued by theInstitute of Company Secretaries of India on Board Meetings and Annual General Meetings.The agenda for the Board and Committee meetings includes detailed notes on the items to bediscussed to enable the Directors to take an informed decision. The Board of Directors hadheld five meetings during FY 2019-20. For further details please refer to the CorporateGovernance Report which forms part of this Annual Report. The intervening gap between themeetings was within the period prescribed under the Act and the Listing Regulations 2015.

Directors and Key Managerial Personnel

In accordance with the Articles of Association of the Company Mr.Rajesh C. Parikh CEO & MD retires by rotation at this Annual General Meeting andbeing eligible offers himself for re-appointment.

Mr. Pravinchandra M. Shah resigned as the Director in the category ofNon – Executive Independent Director w.e.f. 29.04.2019 due to his ageing process andhealth issues. The Board appreciated and taken note of the extensive support and guidancereceived during his tenure as an Independent Director.

The Board has appointed Mr. Jaideep Verma as an Additional Directorw.e.f. 28.05.2019. The Shareholders at their Annual General Meeting held on 13thAugust 2019 appointed Mr. Jaideep Verma as an Independent Director to hold the officeupto 12.08.2024.

Dr. Ajay Ranka Non- Executive Independent Director of the company whowas appointed as an Independent Director for first term of five consecutive years inAnnual General Meeting held on 25th September 2015. Being eligible forreappointment for second term of five years he has offered himself for re-appointment.

The approval of the shareholders relating to re-appointment of Dr. AjayRanka is being considered at the forthcoming Annual General Meeting.

None of the Directors of the Company is disqualified under Section164(2) of the Companies Act 2013. As required by law this position is also reflected inthe Auditors' Report.

In accordance with provisions of Section 149 of the Companies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (ListingRegulations 2015) Mr. Ramkisan Devidayal Mr. Atul Patel Dr. Ajay Ranka and Mr. JaideepVerma have given a declaration to the Company that they meet the criteria of independenceas mentioned in Section 149(6) of the Companies Act 2013.

The composition of the Board meetings of the Board held during theyear and the attendance of the Directors thereat have been mentioned in the Report onCorporate Governance which form part of this Report.

Independent Directors' Declaration

Our definition of ‘Independence' of Directors is derived fromRegulation 16(1)(b) of the Listing Regulations 2015 and Section 149(6) of the Act andrules framed thereunder. The Independent Directors have also submitted a declaration thatthey meet the criteria of independence and that they are not aware of any circumstance orsituation which exist or may be reasonably anticipated that could impair or impact theirability to discharge their duties with an objective independent judgment and without anyexternal influence pursuant to Regulation 25 of the Listing Regulations.

Based on the confirmation / disclosures received from the Directorsthe following Non-Executive Directors are Independent as on March 31 2020:

1) Mr. Ramkisan A. Devidayal

2) Mr. Atul H. Patel

3) Dr. Ajay I. Ranka

4) Mr. Jaideep B. Verma

Committees of the Board

The Company has four Board Committees as on March 31 2020:

1) Audit Committee

2) Nomination and Remuneration Committee

3) Stakeholders Relationship & Share Transfer Committee

4) CSR Committee

Details of all the committees along with their main terms compositionand meetings held during the year under review are provided in the Report on CorporateGovernance a part of this Annual Report.

Board Diversity

The Company recognizes and embraces the importance of a diverse Boardin its success. The Company believes that a truly diverse Board will leverage differencesin thought perspective knowledge skill regional and industry experience cultural andgeographical background age ethnicity race and gender which will help the Company toretain its competitive advantage.

Familiarization Programme for Independent Directors

As trustees of shareholders Independent Directors play a pivotal rolein upholding corporate governance norms and ensuring fairness in decision making. Beingexperts in various fields they also bring independent judgment on matters of strategyrisk management controls and business performance.

At the time of appointing a new Independent Director a formal letterof appointment is given to the Director inter alia explaining the role duties andresponsibilities of the Director.

The Director is also explained in detail the compliances required fromhim / her under the Act SEBI Regulations and other relevant regulations. By way of anintroduction to the Company presentations are also made to the newly appointedIndependent Director on relevant information like overview of the Company'sbusinesses market and business environment growth and performance organisational set upof the Company governance and internal control processes.

Ongoing familiarisation program aims to provide insights into theCompany and the business environment to enable all the Independent Directors to be updatedof newer challenges risks and opportunities relevant in the Company's context and tolend perspective to the strategic direction of the Company. The details forfamiliarisation program for the Independent Directors are put up on the website of theCompany. As required under Regulation 46(2)(i) of the Listing Regulations 2015 thedetails of familiarisation programmes conducted during FY 2019-20 is also put on theCompany's website and the same can be accessed at the link : https://www.20microns.com/wp-content/uploads/2019/04/ 20ML_Familiarization-Programme.pdf

Significant and material orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulatorsor Courts or Tribunal impacting the going concern status and Company's operations infuture.

Auditors

 

A. Statutory Auditors

The Company's Auditors M/s. J.H. Mehta & Co. CharteredAccountants have been appointed for a period of 5 [five] years from the 30thAGM till the 35th AGM. Pursuant to the provisions of Companies (Amendment) Act2017 requirement of ratification of appointment of auditors to be made by shareholders ineach subsequent annual general meetings has been omitted and the said provisions are cameinto effect by MCA Notification dated 07th May 2018. M/s. J.H. Mehta &Co. Chartered Accountants has furnished a certificate of their eligibility and consentunder Section 139 and 141 of the Act and the Companies (Audit and Auditors) Rules 2014 fortheir continuance as the Auditors of the Company for the FY 2020-21. In terms of theListing Regulations 2015 the Auditors have confirmed that they hold a valid certificateissued by the Peer Review Board of the ICAI. The Statutory Auditors' Report for FY2019-20 on the financial statement of the Company forms part of this Annual Report.

The Statutory Auditors' report on the financial statements for FY2019-20 does not contain any qualifications reservations or adverse remarks ordisclaimer.

The Statutory Auditors of the Company have not reported any fraud asspecified under the second proviso to Section 143(12) of the Act.

 

B. Internal Auditors

The Company has appointed M/s. Lalit R. Mehta & AssociatesChartered Accountants Vadodara as the Internal Auditors of the Company for the F.Y.2020-21.

C. Cost Auditors

Your Board has appointed Y. S. Thakar & Co Cost Accountants inPractice as Cost Auditors of the Company for conducting cost audit for the FY 2020-21. Aresolution seeking approval of the members for ratifying the remuneration payable to theCost Auditors for FY 2020-21 is provided in the Notice to the ensuing Annual GeneralMeeting.

Cost Records

The Cost accounts and records as required to be maintained underSection 148 (1) of Act are duly made and maintained by the Company.

D. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act 2013the Company had appointed M/s. J.J. Gandhi and Co. Company Secretaries as theSecretarial Auditor of the Company for the year 2020-21 to conduct secretarial audit andto ensure compliance by the Company with various Acts applicable to the Company. TheSecretarial Audit Report for the financial year 2019-20 issued by M/s. J.J. Gandhi and Co.is annexed to this Report. There are no qualifications observations or adverse remark ordisclaimer in the said report.

Directors' Responsibility Statement

Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the internalstatutory cost and secretarial auditors including audit of internal financial controlsover financial reporting by the Statutory Auditors and the reviews performed by themanagement and the relevant Board committees including the audit committee the Board isof the opinion that the Company's internal financial controls were adequate andoperating effectively during the FY 2019-20.

Pursuant to Section 134(5) of the Act the Board of Directors to thebest of their knowledge and ability confirm:

i) In the preparation of the annual accounts for the year ended March31 2020 the applicable accounting standards have been followed and there are no materialdepartures from the same.

ii) The Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the company as at March 31 2020and of the profit of the Company for the year ended on that date.

iii) The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of this Actfor safeguarding the assets of the company and for preventing and detecting fraud andother irregularities.

iv) The Directors have prepared the annual accounts on a going concernbasis.

v) the Directors had laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively.

vi) the Directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.

Green Initiative

Electronic copy of the Annual Report for FY2020 and the Notice of theensuing AGM is being sent to all shareholders whose email addresses are available in demataccount and registered with Company's Registrar and Share Transfer Agent. As per theGeneral Circular No. 20/2020 of Ministry of Corporate Affairs dated May 5 2020shareholders holding shares in demat form are requested to update their email addresseswith their Depository Participant(s) and for shareholders holding shares in physical formshould get their email registered with Cameo Corporate Services Ltd. Company'sRegistrar and Share Transfer Agent.

Acknowledgement

The Directors wish to convey their deep appreciation to all theemployees bankers customers vendors investors and consultants/advisors of the Companyfor their sincere and dedicated services as well as their collective contribution to theCompany's performance.

The Directors also thank the Government of India Governments ofvarious States in India Governments of various Countries and concerned GovernmentDepartments for their cooperation.

For and on behalf of the Board of Directors
Place : Vadodara Chandresh S. Parikh
Date : 13th August 2020 Executive Chairman