Alps Industries Limited.
Your Directors have pleasure in presenting the 48th AnnualReport together with the Audited Statements of Account of the Company for the financialyear ended on 31st March 2020 in terms of the Companies Act' 2013 and rules& regulation made there under & Regulation 33 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 as amended from time to time. The FinancialStatements have been prepared according to the relevant provisions of Companies (IndianAccounting Standards) Rules 2015.
The Financial 'Performance of the Company for the year ended March 312020 is summarized below:
(Rs. in Lacs)
|Particulars ||Year Ended March 31 2020 ||Year Ended March 31 2019 |
|Total Income ||32194.03 ||37745.77 |
|Operating Earnings/Losses before Financial Expenses Depreciation & Amortization and Tax ||(604.40) ||599.01 |
|Finance Cost ||5753.17 ||5784.20 |
|Depreciation ||1481.82 ||3378.93 |
|Impairment of Assets ||4665.81 || |
|Profit/(Loss) Before Tax ||(12505.19) ||(8564.12) |
|Provision for Tax || || |
|Profit/(Loss) After Tax ||(12505.19) ||(8564.12) |
|Exceptional Items ||995.61 ||2239.07 |
|Surplus /(Deficit) of last year Add: ||(11509.58) ||(6325.05) |
|Surplus available for appropriation ||(59281.07) ||(47771.49) |
|Appropriations || || |
|Surplus/(Deficit) carried to Balance Sheet ||(59281.07) ||(47771.49) |
|Surplus available for appropriation ||_ || |
GLOBAL OVERVIEW - DOMESTIC & EXPORTS
The Cotton Association of India (CAI) in its January 20' estimate hasretained its cotton crop estimate for 2019-20 at 354.50 lakh bales i.e. at the same levelas in the previous estimate. The total cotton supply estimated by the CAI during themonths of October 2019 to January 2020 is 234.89 lakh bales which consists of thearrivals of 192.89 lakh bales upto January 2020. Further the CAI has estimated cottonconsumption during the months of October 2019 to January 2020 at 106 lakh bales while theexport shipment of cotton estimated by the CAI upto January 2020 is 20 lakh bales.Domestic consumption estimated by the CAI for the entire crop year i.e. upto 30thSeptember 2020 is 331 lakh bales i.e. at the same level as estimated by the CottonAdvisory Board. The textile industry has experienced a slowdown in the recent past andlower demand for sure not only in India but globally. There is a silver lining on thehorizon for India. There are subtle indicators for the slowdown is behind us and therecovery phase of business cycle is already in motion particularly due to Lockdown andrecession in overall economy. The future growth will come from the weak links in the valuechain like weaving warp knitting processing and garmenting where most investments arelikely to happen. A growing Indian domestic market which will require investment incapacity building with an ever-increasing focus on expansion and diversification. Theindustry has to collaborate and support one another in order to achieve success can seenow or in the next few months. But what is more important are the few facts which tell usthat India will for sure grow if the right policy on one side and the right capital alongwith the financial support on the other side are deployed. Central and State Governmentsupport is essential for the industry at the moment. We need some policy and the role ofassociations. The upcoming Textile Policy will surely boost the industry. In the long runthough the Indian population which is at 1.3 billion with a demographic advantage ofyounger people with an ever increasing purchasing power is India's biggest asset. Thedomestic textile and apparel markets have grown at 10% CAGR from USD 28 billion in2005-2006 to USD 90 billion in 2017-2018 and it is expected to grow to USD 220 billion in2025-26.The one of the notable aspect is China which is now shifting its focus away fromthe textile industry. This is an opportunity that India is well poised to capitalize on.The next aspect is on the fibre front. The world consumption is moving towards polyesterwith 54% while cotton is just 28% and balance other fabrics like wool nylon acrylic andetc. Even though cotton is one of the cornerstones of the Indian textile industry in thefuture it will not be sufficient and the only way to satisfy the demand is moving toman-made fibre.
Micro level- overall performance
Your company is very much optimistic on growth in sale of new productrange. In the Auto and Technical Textiles segment your company has reasonably done well.Your company started production on Transfer Printing machine and company has successfullylaunched the product. In processing division company has taken up the process optimizationtargets that will reduce process cost as well as process time without impacting productquality. Your company had made a new fabric with the use of Linen yarn development whichhave been commercialize. Your company is focusing more on to the heavy vehicles segmentsTechnical Textiles and Defence sector since your company expecting change in the policyfor procurement of indigenous products. Your company also looking forward to expand thebusiness in other segments during the current financial year. Further company has venturedinto fire retardant fabrics suitable for hotel industry and Defence sector for technicaltextiles. Your company have also reinvented commodity products to have good response fromexports as well as
domestic buyers. The company has started new products during the periodunder review in Yarn segment. Under the Made- up & Fabric Products your companyoffers a range of furnishing products for house and office use. Several initiatives weretaken for update the quality and changing the product mix.
This are value added items with good demand in domestic and exportsmarkets. The efforts to change the Product Mix at our Yarn Spinning Mill at Haridwaradding value added Melange Yarn affected the production temporarily thus adverselyaffecting the Productivity In the Auto & Technical Textiles segment. It is expectedthat the possibility of re-engineering the product constructions and raw materialsutilization mix will give positive results. Under the Made-ups Division company isgrowing and progressing very well in this segment in both Global and Domestic Markets.With changing global demands & stiff competition your company has taken many stepstowards its constant improvements in creating new benchmarks in the industry likeconstant improvements in design & development w.r.t advanced & versatileequipments competent team which helps in reducing turnaround time from CADs to actualphysical sample ability to offer specific developments along with coordinated productacross categories. Further relentless dedication of each and every employee who leave nostone unturned to take company to glorious height. Your company has formulated itsstrategies and has well identified key areas to improve performance in the current marketscenario / environment. Your company is aggressively increasing share of business withexisting customers & focusing on getting new strategic customers focusing onincreasing share of product categories opening up for outsourcing products & servicesto meet the market demands. Under the Made-up & Fabric Products your company offers arange of furnishing products for house and office use and Under the Yarn products itoffers a gray yarn for industrial use. Further company has also undertaken variouslearning & development initiatives during the year for strengthening & upgradingits human capital. Constant efforts are being made to increase the throughput & reducethe OE. While we continue to strive and deliver through performance we maintain ourendeavour to be a socially responsible corporate. Several initiatives were taken forupdate the quality and changing the product mix.
However due to nationwide Lock down by competent authorities theperformance of the company in coming year will be impacted adversely.
During the period under review your company has incurred a negativeEBITDA which comes to Rs.604.40 Lacs in comparison to positive of Rs. 599.01 Lacs inprevious year. The PAT for the period is also negative at Rs. 11509.58 Lacs in comparisonto the previous year of Rs. 6325.05 Lacs which is partly due to impairment on assets incurrent year and due to low volume of turnover as there was economic slowdown andcontinuation of fixed expenses and further better in previous year due to exceptionalprofit for the reason of write back of debt payable to lenders because of settlement withthem.
FUTURE OUTLOOK - TECHNICAL FRONT
At this unit your company is focusing on improving plant performance ingeneral and to produce quality oriented yarns for higher segment. The company is findingout the possibility of re-engineering the product constructions and raw materialsutilization mix. In processing of products your company has taken up the processoptimization project that will reduce process cost as well as process time withoutimpacting our product quality. In Meerut Unit Company is exploring the possibility ofreengineering the product constructions and raw materials utilization mix. To upgrade thetechnological front various efforts are being taken. This will add new value added productrange. Your company is optimistic for the market response of newly introduced productrange by technological development. Your company is continually up-grading machinesthrough technical
improvements for productivity resulting in production enhancement. Yourcompany is adding new customers & enhancing share of more profitable products toimprove profitability. Company is hopeful for growth in marketing of new product range. Inother units also we have been able to maintain the balanced technical performance interms of utilization and productivity during the financial year under consideration.
FINANCIAL RESTRUCTURING & STATUS OF UNITS OF THE COMPANY
During earlier year the lenders having more than 83% of then secureddebts of the Company revoked their consent to the DRS/settlement scheme circulated byerstwhile Hon'ble BIFR interalia containing the restructuring of the debts of theCompany which was partly implemented. The Company objected to the said revocation ofconsent being unjustified and beyond terms of the scheme and further submitted an offerfor settlement. M/s Edelweiss Assets Reconstruction Company Ltd. (presently holding morethan 98% of the total secured debt of the Company) (EARC) in order to recover its duesfrom the Company has also filed an Original Application before Debts Recovery TribunalLucknow Bench which application is pending adjudication. In addition to above EARC hasunder the provisions of SARFAESI auctioned properties located at 58/1 Site IV IndustrialArea Sahibabad Ghaziabad (U.P.) B-2 Loni Road Industrial Area Ghaziabad (UP) and Allthat Plant & Machineries lying at l A Sec.-10 11E SIDCUL Haridwar and Lendershaving first pari passu charge over these assets have adjusted their dues with therealization made thereof. EARC has also taken over the symbolic possession of 3 propertiesViz. Leasehold Land Building and Plant & Machineries lying at Plot nos. A-2 &A-3 Loni Road Industrial Area Ghaziabad (UP) and lA Sec.-10 IIE SIDCUL Haridwarunder section 13(4) of the SARFAESI Act and issued a sale notice under Rule 8(6) and Rule6(2) of the Security Interest (Enforcement) Rules 2002. The adjustments as may arise onaccount of further action of lenders if any shall be made in the books of account in theyear upon receipt of information from them. The Company once again submitted a revisedsettlement/restructuring proposal with lenders which is under active consideration withthem. Your company expects to get the revised settlement/restructuring proposal approvedfrom lenders and accordingly the Company would be meeting its revised financialobligations.
Further Syndicate Bank has waived/extinguished their rights ofredemption of their 7416190 6% Cumulative Redeemable Preference shares alongwith dividendrights vide their letter dt. 22/10/2019. The board has approved the extinguishment.Accordingly the company has extinguished the 7416190 unlisted CRPS. The Alankit AssignmentLtd R&T Agent and National Securities Depositories Limited have approved. Now noshares exist in favour Bank w.e.f. November 27 2019.
With the contribution and efforts of all concerned the variouscredentials have been renewed /continued during the period under review viz.:
Gots certificate Organic cotton.
Oeko-tex renewal under process for Hohenstein Textile TestingInstitute Germany.
IATF renewal under process for manufacturing seat fabrics for theautomotive application.
Scan certificate for Security Audit renewal under process.
Walmart certificate for Supply Chain for Export units renewal underprocess.
BSCI certificate for Social Audit.
MEASURES TO REDUCE/CONTROL COST
In Hardwar unit installation of AC Drive in Toyota Ring Frame machinesfor suction fan motor with feedback control system AC Drive in link coner machines forsuction fan motor and replacement of air fan motor with low power consumption has beencompleted during the year. On technical front your company is continuously try to achievethe reduction in raw material cost by making different composition of mixing/purchase ofcotton through commodity exchange increase in machine productivity better yarn yieldwith optimum use of raw material control waste generation to bare minimum and best use ofwork force best utilization of capacity with lowest Raw Material Cost and good quality ofend product to fetch best yarn price. To active saving by optimum utilization Air as perrequirement of machine the working pressure has been reduced and wastage of Air have beencontrolled in our Hardwar unit. The spinning and weaving units have taken variousimportant steps which includes buying of raw material in bulk quantity directly fromsuppliers after proper negotiation and studying market prices reducing the fixedoverheads increase the utilization and efficiency of machineries to reduce the coststandardize the production process flow chart to avoid the rejection maintain theinventory level as per the requirement constant check on power consumptioncontrolling/reducing rejections & re-processing reusing / recycling all possibleitems strict follow-up on regular maintenance schedule to avoid major break downsincreasing overall efficiency to reduce production cost using low consumption LED lights.
In weaving unit the company is looking forward to analysis thepossibility of re-engineering the product constructions and raw materials. Further focusis on the strict monitoring of the inventory and to procure the raw material in minimumlead time. It will minimize the buffer stocks. In order to reduce marketing cost we aredistributing the material through depot nearest to consumers. This will bring down thetransportation and handling cost. To meet out the market competitiveness and improve thefinancial performance the company is committed to reduce the cost upgrade the efficiencyand ensure optimum utilization of the current as well as fixed assets of the company.. Inorder to reduce the substantial logistic cost the company is opting for land portsnearest to the units. Transportation cost reduced by finalizing the transport &courier contracts at best possible lowest rates for the goods movement of the Units. Theunit located at Meerut has also optimized its cost structure by way of strong emphasis onconsumption and control of waste reduction & rationalization inventory control &Manpower optimization. In Made up unit your company have implemented strict monitoring ofthe stocks by analyzing the in minimum lead time. Energy audit observations andsuggestions by competent agency were also implemented at the spinning unit during theperiod under review to save the Energy cost. This has resulted in significant costsavings.
GOVERNMENT INITIATIVES- TEXTILE SECTOR
The Government has announced National Technical Textiles Mission whichis expected to give thrust to production of a wide variety of textiles used in sectorssuch as healthcare infrastructure automobiles defence and agriculture. The 1480-croreMission to be implemented from 2020-2021 to 2023-2024 aims at positioning India as aglobal leader in technical textiles. The size of the technical textile industry in thecountry is approximately 12000 crore excluding the hygiene industry. The last time thesector received focus was a few years ago to set up six centers of excellence across thecountry. With the need to create a domestic base for raw material production push formanufacture of high end technical textile products boost investments and increase percapita consumption there is a need for a Mission. Another major announcement wasabolition of anti-dumping duty on PTA (Purified Terephthalic Acid) which is expected togive a thrust to the polyester fibre sector This is
the raw material for production of polyester fibre. This was one of thelong-pending demands of the industry. Abolition of anti-dumping duty will bring polyesterprice in India on a par with international price. Polyester will be the future engine ofgrowth for the Indian textile industry. Within days of hiking the deposit insurancefive-folds to Rs 5 lakh per account Finance ministry is working on the controversialFinancial Resolution & Deposit Insurance (FRDI) Bill. The government was forced towithdraw the FRDI Bill from the House after Opposition members objected to it especiallythe bail-in clause to banks which many fear is detrimental to depositors' Finance Budgetfor 2020-21was light on new structural reforms. It has not materially altered itsforecasts for India's economic growth to rise to 5.6 per cent in the next fiscal from 4.6per cent in 2019-20. The Union Budget 2020-21 implies a modest degree of slippage fromprevious targets to consolidate public finances. However its contents are consistent withour expectations. The Budget was light on new structural reforms although the governmenthad already unveiled some measures last year The finance ministry announced some easingof restrictions on foreign portfolio inflows and schemes to encourage manufacturing inelectronics and textile sectors.
Due to the operational losses suffered by the company your directorsdo not propose any dividend for the current financial year.
TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND
In terms of Section 124 of the Companies Act 2013 there was nounclaimed dividend relating to the financial year 20182019 which was due for remittanceduring the financial year 2019-2020. Hence no amount due to be transferred to the InvestorEducation and Protection Fund established by the Central Government. Further in terms ofSection 124 (6) of Companies Act 2013 and the Rule 6 of Investor Education and ProtectionFund Authority (Accounting Audit Transfer and Refund) Rules 2016 there under and MCANotification dated August 14 2019 during the year the unclaimed equity shares of thecompany represented by the unclaimed/unpaid and lying in the Alps Industries Ltd.-Unclaimed Share Demat Physical Account of the company have been transferred to theInvestor Education and Protection Fund Authority (IEPF) Authority. If any investors wishto claim their so transferred shares and unclaimed dividend they have to complyprovisions of section 124(6) of Companies Act 2013 and the procedures specified underRule 7 of the IEPF (Accounting Audit Transfer and Refund) Rules 2016. The details ofshares transferred to IEPF account can be visited at website of the company i.e.www.alpsindustries.com.
DECLARATION BY INDEPENDENT DIRECTORS
All the Independent directors viz. Mr. Prabhat Krishna Mr. PradyumnKumar Lamba Mr. Tilak Raj Khosla and Ms. Deepika Shergill have submitted their disclosureto the Board that they fulfill all the requirements as to qualify for their continuity ofappointment as an Independent Director under the provisions of section 149 the CompaniesAct 2013 as well as Regulations 16 & 17 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
Further in terms of Schedule V of Regulation 34 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 effective from 01.04.2019 a certificate from a company secretary in practice thatnone of the directors on the board of the company have been debarred or disqualified frombeing appointed or
continuing as directors of companies by the Board/Ministry of CorporateAffairs or any such statutory authority of all directors as on March 31 2020 is beingAnnexed.
Further in terms of Rule 6 of Companies (Appointment and Qualificationof Directors) Rules 2014 and notification no. G.S.R. 804(E) dated 22nd October 2019 allthe Independent Directors of the company has registered with the Indian Institute ofCorporate Affairs (Institute) initial validity period of one year during the year.
Further as no Independent director has been appointed during the yearthe statement regarding opinion of the Board with regard to integrity expertise andexperience (including the proficiency) of the independent directors appointed during theyear is not applicable.
RISK MANAGEMENT PLAN
Pursuant to section 134 (3) (n) of the Companies Act 2013 &Regulation 17(9) of the SEBI (Listing Obligations and Disclosure Requirements) Rules 2015the Company has framed an effective Risk Management policy in order to analyze control ormitigate risk. The board periodically reviews the risks and suggests steps to be taken tocontrol the same. The same is reviewed quarterly by senior management and also by theAudit Committee of the Board. In compliance of Regulation 21 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 related to corporategovernance the company is not mandatorily required to constitute the Risk ManagementCommittee but for its own betterment has formulated the Risk Management plan as up datedfrom time to time. The company continues to recognizes that the Enterprise Risk Managementis an integral part of good management practice. In terms of Policy the Company iscommitted for managing the risk in a manner appropriate to achieve its strategicobjectives. The Company will keep investors informed of material changes to the Company'srisk profile through its periodic reporting obligations and ad hoc investor presentations.Accordingly the Company has framed procedures to inform members of Board of Directorsabout risk assessment and minimization procedures. The detailed policy can be viewed atthe website of the company i.e. www.alpsindustries.com.
POLICY FOR DETERMINATION OF "MATERIALITY"
In terms of the provisions of Regulation 30 Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 theCompany has framed and up dated a policy for determination of "Materiality"and the Board of Directors has appointed the Company Secretary & Compliance Officer asthe "Materiality Officer" to take care of the relevant compliances. Thedetailed policy can be viewed at the website of the company i.e. www.alpsindustries.com.
POLICY FOR PRESERVATION OF DOCUMENTS
In terms of the provisions of Regulation 9 Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 thecompany has framed a policy for preservation of documents. The detailed policy can beviewed at the website of the company i.e. www.alpsindustries.com.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The Company has provided for adequate safeguards to deal with instancesof fraud and mismanagement and to report concerns about unethical behaviour or anyviolation of the Company's Code of Conduct. During the year under review there
were no complaints received under this mechanism. In terms of section177 of the Companies Act 2013 and Regulation 22 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the company has established a Vigil Mechanismpolicy for the Directors and Employees to report genuine concerns in such manner asprescribed under Rule 7 of Companies (Meetings of Board and its Powers) Rules 2014 andsuch a vigil mechanism has provided for adequate safeguards against victimization ofpersons who use such mechanism and made provisions for direct access to the chairperson ofthe Audit Committee in appropriate or exceptional cases instances of unethical behavioractual or suspected fraud or violation of the company's code of conduct etc. The detailedpolicy can be viewed at the website of the company i.e. www.alpsindustries.com.
NOMINATION & REMUNERATION EVALUATION BOARD DIVERSITY POLICY &FAMILIARIZATION PROGRAMME AND CRITERIA FOR MAKING PAYMENT FOR INDEPENDENT DIRECTORS
As mandated by the statutory provisions contained under section 178 ofthe Companies Act 2013 and Regulation 19 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Nomination & Remuneration Committee of the Boardhas already formulated which is in force as on date. This policy contains guidelines onnomination and remuneration of Directors Key Managerial Personnel (KMP) and SeniorManagement Personnel of the Company and Evaluation and Board Diversity policy fordirectors. This policy may be treated as a benchmark for determining the qualificationspositive attributes and independence of a Director criteria for evaluation of IndependentDirectors and the Board matters relating to the remuneration appointment removal andevaluation of performance of the Directors Key Managerial Personnel and Senior ManagementPersonnel of the Company. To provide insights into the Company to enable the IndependentDirectors to understand the Company's business in depth that would facilitate their activeparticipation in managing the Company familiarization Program have been formulated andintroduced by the Company to simplify the understanding of various responsibilities andrights of the Independent Directors during the year under review. The SEBI vide CircularNo. SEBI/HO/CFD/CMD/CIR/P/2017/004 dated January 5 2017 has issued Guidance Note on BoardEvaluation for all listed entities. It has been reviewed by the Board of Directors andnoted the criteria for evaluation of Board as a Whole Non Independent Directors andIndependent Directors of the Company. Further in terms of SEBI circular
SEBI/HO/CFD/CMD/CIR/P/2018/79 dated May 10 2018 the Disclosures onBoard Evaluation additional requirement like Observations of board evaluation carried outfor the year Previous year's observations and actions taken and Proposed actions basedon current year observations have been made part of policy. The board of directors of thecompany in their meeting held on 30.05.2018 has approved the revised policy on BoardEvaluation and the same has been placed on the website of the company. The detailed policycan be viewed at the website of the company i.e. www.alpsindustries.com.
In terms of Regulation 34 & 46 of and schedule V the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the criteria for makingpayment to the Non Executive Directors is being complied and is available at Companywebsite www.alpsindustries.com.
RELATIONSHIP WITH INVESTORS
To have the participation by all the valued investors in the votingpattern for any proposal and in terms of the compliance of the Section 108 of theCompanies Act 2013 and Companies (Management and Administration) Rules 2014 made thereunder and in terms of Regulation 44(1) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the company
has made arrangements for e-voting facility through which any investorcan participate in the AGMs through e-voting and need not struggle to attend the meetingsin person.
In view of the massive outbreak of the COVID-19 pandemic pursuant tothe Circular No. 14/2020 dated April 08 2020 17/2020 dated April 13 2020 18/2020 dated21.4.2020 20/2020 dated May 05 2020 and 22/2020 dated 15.6.2020 issued by Ministry ofCorporate Affairs and Rule 20(4)(v) of the Companies (Management and Administration) Rules2014 due to massive outbreak of the COVID-19 pandemic to maintain the social distancingissued by the Ministry of Corporate Affairs physical attendance of the Members to theforthcoming AGM venue is not required. Hence Members have to attend and participate inthe ensuing AGM though VC/OAVM.
Further in terms of Regulation 20 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and Section 178 of the Companies Act 2013 andCompanies (Meetings of Board and its Powers) Rules 2014 made thereunder the Company hasframed Stakeholder Relationship Committee which is fully committed and accountable to thevalued investors who have reposed the confidence in the company by investing their hardearned money in the company and supported the management in such a crucial time.
The relationship with the investors continues to be cordial. Yourcompany's management is fully aware and dedicated for survival of the company andcommitted to take all efforts to resolve the investors' grievances received during theyear to the satisfaction of the investors within a reasonable time. M/s AlankitAssignments Limited the R & T Agent of the company continued to extend theirpositive contribution to resolve the Investors' grievances efficiently and effectivelywhenever they arose. By contribution from all concerned the investor grievances have beenresolved to the fullest satisfaction of investors. We sincerely place on record theappreciation for our valued investors who have contributed and reposed the confidence inthe company at this difficult time. The management not only believes in legal compliancerelated to the investors but also morally protects their interest and treats them aspart of Alps Group. In its endeavor to improve investor services your Company has createdan investor section and designated exclusive E-Mail ID for the purpose of registeringcomplaints by investors and necessary follow up action by the company / compliance officerin compliance with Regulation 46 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. The e-mail ID is: firstname.lastname@example.org.
HUMAN RESOURCES - MANPOWER OPTIMIZATION
The focus during the year has been on the optimization of availableManpower resources as the on-going challenges created due to market slow-down in theprevious year continued this year as well. Learning from 'Theory of Constraints (TOC)'proved very useful in this endeavor the concept cascaded across all the hierarchy amongstthe team. Focus remained on Continuous improvement / BTB (Better-Than-Before).Learningfrom TOC helped in strengthening some of the critical functions in terms of appointingcompetent personnel in the concerned leadership roles like in Marketing for Fabric as wellas Made-ups business and in Maintenance and HR in Yarn Business. Though challenges withongoing slow-down continued this year as well across the country efforts made effectivelyin order to retain the talent with traditional as well as innovative retention strategies.With continued efforts to improve the female workers/employees ratio particularly at theshop floor in-line with the national policy of gender equality and policy to restrict thesexual harassment there has not been any case of sexual harassment reported andhomogeneity of the Work environment is maintained. Besides efforts were made for regionalbalancing of
Workers in our Haridwar Unit significant efforts were made to controlLabour Losses. The company's concerns for welfare of its workforce continued during theyear and accordingly Group pension/Accident Insurance policy/ESI/WC policies werecontinued further as in the past. The company has been consistently maintaining harmonious& cordial relations with the employees at all the locations. The Company continues tolay emphasis on building and sustaining an excellent organizational culture focusing onperformance. During the year with consistent review and efforts for optimization ofavailable manpower resources average employment has been 1650 slightly less than thatof last year. Pursuit of proactive policies for industrial relations has resulted in apeaceful and harmonious situation on the shop floors of all the plants.
BOARD OF DIRECTORS- CHANGES/REAPPOINTMENTS
During the year under review Mr. Krishan Kumar Agarwal (DIN:00139252)Promoter and relative of Mr. Sandeep Agrawal Managing Director has resigned from theposition of Director and Non Executive Chairman on 31.07.2020 due to health reasons. TheBoard of Directors of the company has accepted his resignation letter in their meetingheld on 31.07.2020 and records their appreciation for the valuable services and advicesduring his tenure provided to company.
REAPPOINTMENT OF NON-INDEPENDENT DIRECTORS BY ROTATION AND AS WHOLETIME DIRECTOR
In terms of the provisions of Section 152 of the Companies Act 2013and Companies (Appointment and Qualification of Directors) Rules 2014 & Article No.106107 & 108 of the Articles of Association of the Company Mr. P.K. Rajput(DIN:00597342) Non-Independent and Executive Director recommended by the Nomination &Remuneration Committee and by the Board of Directors at their meeting held on July 312020 for re-appointment who retires by rotation and eligible for reappointment and offerhimself for reappointment at the ensuing Annual General Meeting. The disclosures asrequired under the provisions of Companies Act 2013 Regulation 17 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 related to Corporate Governancepublished elsewhere in the Annual Report.
Further in terms of Sections 196 and 197 read with Schedule V and allother applicable provisions if any of the Companies Act 2013 and recommendation ofNomination and Remuneration committee the reappointment of Mr. P.K. Rajput (DIN:00597342) as Executive Director in terms of Sections 196 & 197 of Companies Act 2013and Schedule V is proposed by way passing the special resolution in the ensuing AnnualGeneral Meeting for a further period of three years effective from July 28 2021 to July27 2024.
NUMBER OF BOARD MEETINGS
Minimum four prescheduled Board meetings are held every year. In caseof any exigency/emergency resolutions are passed by circulation. During the FinancialYear 2019-20 the Board of Directors met four times on 30/05/2019 14/08/2019 14/11/2019and 12/02/2020. The maximum gap between any two meetings was less than one hundred andtwenty days as stipulated under section 173 of Companies Act 2013 and Regulation 17 ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 andSecretarial Standards.
KEY MANAGERIAL PERSONEL
During the under review as required under section 203 of the CompaniesAct 2013 and applicable rules There is no change in the Existing KMP's of the Companyviz. Mr. Sandeep Agarwal (Managing Director) Mr. Ashok Kumar Singhal (President-
Accounts & Finance) and Mr. Ajay Gupta (Company Secretary &General Manager-Legal). Hence they continued to be KMP's of the Company.
INTER CORPORATE LOANS GUARANTEES AND INVESTMENTS
During the year under review company has not given any Inter CorporateLoans Guarantees and Investments covered under section 186 of the Companies Act 2013.
CORPORATE SOCIAL RESPONSIBILITY
Due to net loss suffered by the company during the financial year2018-19 in terms of the provisions under Section 135 of the Companies Act 2013 thecompany was not required to make expenditure on the CSR activities in the financial year2019-20. Your company has CSR Committee which had been constituted by the board of thecompany. The CSR Committee have framed a Corporate Social Responsibility Policy (CSRPolicy) duly approved by the Board at their meeting held on 12.8.2016 indicating theactivities to be undertaken by the Company to fulfill the expectation of our Stakeholdersand to continuously improve our social environmental and economical performance whileensuring sustainability and operational success of the Company. The Company would alsoundertake other need based initiatives in compliance with Schedule VII to the CompaniesAct 2013 and Companies (Corporate Social Responsibility Policy) Rules 20I4 if required.
Due to losses in previous financial year i.e. 2018-19 the requirementsfor annexing the Statement of Annual Report on CSR Activities in terms of the provisionsof section 135 and Rule 8 of Companies (Corporate Social Responsibility Policy) Rules2014 are not applicable.
RELATED PARTY TRANSACTIONS
In terms of the Section 188 Companies Act 2013 and Companies (Meetingsof Board and its Powers) Rules 2014 and further in terms of Regulation 23 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 related to theCorporate Governance the company has formulated a Policy on Materiality of Related PartyTransactions and the same is duly reviewed and updated from time to time as required andlatest on July 31 2020 at the meeting of Board of Directors. During the year under reviewthe company has entered into related party transactions which are at the market prevailingprices and on arm's length basis and are in its ordinary course of business and in termsof IND AS 24. Hence there are no conflicts of interest and in compliance with the Policyon Materiality of Related Party Transactions. It is also hereby confirmed that the limitof Rs. 1.00 crore of per transaction as approved at the meeting of Board of directors heldon May 30 2019 has been adhered to during the year.
DIRECTORS' RESPONSIBILITY STATEMENT
In compliance with the provisions of Section 134(5) of the CompaniesAct 2013 the Board confirms and submits the Directors' Responsibility Statement:
In the preparation of the annual accounts the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures;
The directors had 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 at the end of thefinancial year and of the profit and loss of the company for that period;
The directors had 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;
The directors had prepared the annual accounts on a goingconcern basis; and
The directors in the case of a listed company had laid downinternal financial controls to be followed by the company and that such internal financialcontrols are adequate and were operating effectively which means the policies andprocedures adopted by the company for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information;
The directors had devised proper systems to ensure compliancewith the provisions of all applicable laws and that such systems were adequate andoperating effectively.
PARTICULARS OF EMPLOYEES
In terms of the provisions of section 197 of Companies Act 2013 readthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended from time to time none of the employee is drawing remuneration more than thelimits prescribed/specified under the said rules during the financial year 2019-20. Interms of Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as amended the details of top ten employees drawing remuneration are enclosedas Annexure 1.
However Particulars of employees under Section 197 of the Companies Act2013 and applicable Rules made there under having paid in excess of the remuneration paidto Whole Time Directors as on March 31 2020 is not applicable as no remuneration has beenpaid to the any whole time directors of the company during the year.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO.
Information in accordance with the provisions of Section 134 (3) (m) ofthe Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014regarding conservation of energy technology absorption and foreign exchange earnings andoutgo has been given in the statement annexed as Annexure-II here to and forms part ofthis report.
COST AUDIT REPORT
In compliance with the Companies (Cost Records & Audit) Rules 2014published vide GSR No. 01(E) on December 31 2014 issued by the Central Government interms of the Powers conferred by Section 148 of the Companies Act 2013 company hadappointed M/s. Gaurav Gupta & Associates Cost Accountants (Firm Regn. No. 104132) tosubmit the Cost Audit Report duly approved by the Board of Directors to the CentralGovernment for the financial year ended on March 31 2020 for the products which arespecified in the Notification No. GSR No. 01(E) on December 31 2014 and Companies (CostRecords and Audit) Rules 2014 as amended from time to time. The Cost Audit report asissued by the M/s. Gaurav Gupta & Associates
Cost Accountants being the cost auditors of the company for thefinancial year 2019-20 will be filed by the company within the due date.
In compliance with the Companies (Cost Records & Audit) Rules 2014published vide GSR No. 01(E) on December 31 2014 issued by the Central Government interms of the Powers conferred by Section 148 of the Companies Act 2013 M/s V B S K& CO. Cost Accountants Firm Regn. No. 000352 Cost Accountants Ghaziabad firm of CostAccountants has been appointed as the Cost Auditors of the company under Section 148 ofthe Companies Act 2013 for the next financial year ended on March 31 2021 at themeeting of Audit Committee and Board of Directors of the company held on July 31 2020. Asrequired under Section 148 of the Companies Act 2013 the ratification for theirappointment & remuneration has been recommended at the forthcoming Annual GeneralMeeting of the company. However it is strictly applicable in terms of anyNotifications/Circulars related to Cost Records and Cost Audit Rules as may be specifiedat any time by the MCA or any regulatory authorities. If due to any reasons the mandatoryrequirements abolish then continuation of the appointment of Cost Auditors will be atthe discretions of the board of directors as per the requirements of the company.
M/s. R.K. Govil & Co. Chartered Accountants (Firm RegistrationNo. 000748C) the Statutory Auditors of the Company was reappointed under section 139 ofthe Companies Act 2013 and Companies (Audit and Auditors) Rules 2014 for five years fromthe conclusion of the Forty Seventh Annual General Meeting until the conclusion of theFifty Second Annual General Meeting i.e. from 01.04.2019 to 31.03.2024. The board ofdirectors has approved the continuity of auditors for remaining four years at theirmeeting held on July 31 2020. In terms of the above section and as amended from time totime no further confirmation from the members of the company is required since therequirement of ratification by the shareholders have been withdrawn by MCA videnotification dated May 8 2018. The company has received the eligibility certificatesunder Section 141 of the Companies Act 2013 from the said auditors.
In terms of Section 138 of the Companies Act 2013 and Companies(Accounts) Rules 2014 the Board of Directors at their meeting held on July 31 2020 hasapproved the arrangement of in house internal audit though the requisite qualified andexperienced officials of the company to conduct the internal audit of the company for thefinancial year 2020-21.
During the year your company has not raised any money by way ofDeposits under the provisions of Companies Act 2013 and Companies (Acceptance ofDeposits) Rules 2014.
CORPORATE GOVERNANCE DISCLOSURES
The Management Discussion and Analysis is given as an Annexure-III tothis report and further the requirements of Regulation 27 of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 on the Corporate Governance practicesfollowed by the Company and the Statutory Auditors' Certificate on Compliance of mandatoryrequirements as Annexure-IV
along with the non mandatory information under corporate governance isannexed as part II of Corporate Governance Report. It has always been the endeavor of yourcompany to practice transparency in its management and disclose all requisite informationto keep the public well informed of all material developments.
SECRETARIAL AUDIT REPORT
In terms of the Section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorsat their meeting held on May 30 2019 company has appointed M/s. D.K. Chawla & Co.Company Secretaries to provide the Secretarial Audit Report for the Financial Year endedon March 31 2020. In compliance of aforesaid requirement they have provided theSecretarial Audit Report which has been annexed with Board report as Annexure V and theSecretarial Audit Report of the Material Indian Subsidiary company i.e. Alps EnergyPrivate Limited is beingannexed in the annualreportelsewhere.
Further in terms of SEBI Circular No. CIR/CFD/CMD1/27/2019 datedFebruary 08 2019 the Annual Secretarial Compliance Report for the financial year 2019-20has been submitted to Stock Exchanges.
Further the Board of directors of the company has appointed M/s. NishaChoudhary & Associates Company Secretaries Ghaziabad Company Secretaries to providethe Secretarial Audit Report for the next Financial Year ending on March 31 2021.
ABSTRACT OF THE ANNUAL RETURN
In terms of amended section 92 of the Companies Act 2013 and asamended vide Companies (Amendment) Act 2017 and further vide notification dated May 72018 the extract of the Annual Report as on it stood as on March 31 2020 being attachedwith the Directors Report as Annexure VI. It is also displayed on the website of thecompany i.e. www.alpsindustries.com.
STATUS OF HOLDINGS IN SUBSIDIARY COMPANIES
As per Section 2(87) of the Companies Act 2013 as amended videNotification No. S.O. 1833(E) dated 8th May 2018 M/s. Alps Energy Pvt. Ltd.remains to be the Subsidiary company of the Alps Industries Ltd. by way of controlling thevoting powers to the extent of 69.75% in its aggregate voting powers of the aforesaidcompany. In terms of Regulation 24 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Mr. Prabhat Krishna (DIN:02569624) Independent & NonExecutive Director of the Company continues to be representative director in the aforesaidIndian "Material subsidiary" company i.e. M/s. Alps Energy Pvt. Ltd. andM/s Alps USA Inc being "Material subsidiary in terms of Regulation 24of the amended SEBI Circular SEBI/LAD-NRO/GN/2015-16/013 dated 2.9.2015 during the periodunder review.
FINANCIAL STATEMENTS/ PERFORMANCE OF SUBSIDIARY COMPANIES
The company continued to have two subsidiaries at the end of thefinancial year viz; M/s. Alps USA Inc. incorporated in USA and M/s. Alps Energy Pvt. Ltdincorporated in India. As required under Section 129(3) of the Companies Act 2013 andapplicable rules the Financial Statements of these Subsidiary Companies are being annexedalong with the separate statement containing the salient features of the financialstatement of its subsidiaries and associate companies in terms of Rule 5 of Companies(Accounts) Rules 2014.
Further in terms of the provisions of Section 134 (3) (m) of theCompanies Act 2013 read with Rule 8(1) of the Companies
(Accounts) Rules 2014 regarding the report on the highlights ofperformance of subsidiaries and their contribution to the overall performance of thecompany during the period under report in the prescribed Form AOC -1 is enclosed asAnnexure- VII in the Annual report.
Observations in the Auditors' Report are dealt within Notes to Accountsat appropriate places and being self-explanatory need no further explanations With regardto Audit qualifications for the year under review as per the requirement under Regulation33 of the SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 andfurther amended by SEBI Notification No. SEBI/LAD-NRO/GN/2016-17/001 dated May 25 2016and as amended on May 9 2018 and Circular No. CIR/CFD/CMD/56/2016 dated May 27 2016issued by the Securities and Exchange Board of India (SEBI) the Statement on Impact ofAudit Qualifications signed by Managing Director/CFO/ Chairman of the Audit Committee andAuditors have been submitted with stock exchanges and forming the part of Annual Report.
No disclosure or reporting is required in respect of the followingitems as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of theCompanies Act 2013.
2. Issue of equity shares with differential rights as to dividendvoting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of theCompany under any scheme save and except ESOS referred to in this Report.
4. Neither the Managing Director nor the Whole-time Directors of theCompany receive any remuneration or commission from any of its subsidiaries.
5. No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern status and Company's operations infuture.
6.In terms of section 143 (12) of the Companies Act 2013 it is herebyconfirmed that there are no frauds reported by auditors other than those which arereportable to the Central Government.
During the year under review there were no cases filed pursuant to theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
Your Directors take this opportunity to thank the Banks ARCs ReserveBank of India Central and State Governments Authorities Regulatory Authorities Hon'bleNational Green Tribunal National Company Law Tribunal Securities Exchange Board ofIndia Stock Exchanges Stakeholders Customers and Vendors for their continued supportand co-operation and also thank them for the trust reposed in the Management. TheDirectors place on record their appreciation for the efficient and loyal services renderedby the Staff and workmen also acknowledge the help support and guidance from the variousStatutory Bodies Government and Semi-Government Organizations and thank for customerssuppliers investors for their continues support during the year.