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Archit Organosys Ltd.

BSE: 524640 Sector: Industrials
NSE: N.A. ISIN Code: INE078I01011
BSE 15:09 | 03 Feb 74.50 1.55
(2.12%)
OPEN

73.90

HIGH

81.70

LOW

73.10

NSE 05:30 | 01 Jan Archit Organosys Ltd
OPEN 73.90
PREVIOUS CLOSE 72.95
VOLUME 52137
52-Week high 100.00
52-Week low 35.05
P/E 14.90
Mkt Cap.(Rs cr) 153
Buy Price 74.45
Buy Qty 8.00
Sell Price 74.50
Sell Qty 427.00
OPEN 73.90
CLOSE 72.95
VOLUME 52137
52-Week high 100.00
52-Week low 35.05
P/E 14.90
Mkt Cap.(Rs cr) 153
Buy Price 74.45
Buy Qty 8.00
Sell Price 74.50
Sell Qty 427.00

Archit Organosys Ltd. (ARCHITORGANOSYS) - Director Report

Company director report

To

The Members

Your Directors have pleasure in presenting the 29th AnnualReport together with the Audited Statement of Accounts for the year ended on 31st March2022.

FINANCIAL RESULTS:

The operating results of the Company for the year ended on 31st March2022 are briefly indicated below:

(Rs. in Lacs)
Year 2021-2022 Year 2020-2021
Total Income 13858.43 9505.44
Operating Cost including Depreciation 12471.84 8712.50
Financial Expenses 244.05 324.53
Total Expenses

12715.89

9037.03

Profit before Taxation

1142.54

468.41

Provision for taxation - For Current Tax 145.00 46.00
Provision for taxation - For Deferred Tax 312.20 (32.24)
MAT credit Entitlement (137.82) (46.00)
Profit after Taxation

823.16

500.65

DIVIDEND AND TRANSFER TO RESERVES:

An amount of Rs. 823.16lacs (previous year Rs. 500.65 lacs) is proposedto be held as Retained Earnings.

Your Directors have recommended a dividend of Rs. 0.75 (7.50%) pershare for the approval of the Members at the ensuing 29th Annual GeneralMeeting.

PERFORMANCE OF THE COMPANY & FUTURE PROSPECTS:

With the consistent performance and sheer dedication the Company wasable to stand out in the difficult times of second wave of COVID-19 in India. Not onlythe Company was able to continue the momentum of earning profit but has shown outstandingperformance by reaching the bottom line profits of Rs. 1142.53 Lacs as compared to Rs.468.41 Lacs in the previous financial year.

Total revenue from Operations of the Company for fiscal year 2022increase at Rs. 13666.42 Lakhs as against Rs. 9451.12 Lakhs for fiscal year 2021showing a growth of 44.60%.

Company's Net profit after Tax (PAT) is Rs. 823.15 lakhs forfiscal year 2022 against Profit of Rs. 500.65 lacs for fiscal year 2021 i.e. increase by64.41%.

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIALPOSITION OF THE COMPANY FROM THE CONCLUSION OF THE FINANCIAL YEAR TILL THE END OF THISREPORT:

There were no other material changes and commitments affecting thefinancial position of the Company which have occurred between the end of the financialyear of the Company and the date of this report.

MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:

A report on Management Discussion and Analysis (MDA) is annexed to thisreport as Annexure B inter-alia deals adequately with the operations and alsocurrent and future outlook of the Company.

SHARE CAPITAL

As on March 31 2022 the paid up capital of the Company was Rs.205207230/- divided into 20520723 equity shares of Rs. 10/- each.

During the year Company has allotted 5500000 equity shares intranches upon conversion of convertible warrants issued on preferential basis as approvedby members at the 27th Annual General Meeting of the Company held on September29 2020. The Company received trading approval from BSE Limited vide notice no.20210705-5 dated July 5 2021 admitting 2000000 number of equity shares for tradingw.e.f. July 6 2021 and allowed trading for balance 3500000 equity shares w.e.f. August5 2021 vide its Letter no. 20210804-18 dated August 4 2021.

VARIATION IN UTILIZATION OF PROCEEDS OF RIGHTS ISSUE:

Details of amount utilized from convertible warrants till March 312022 is as follows:(Rs. In Lacs)

No. Total issue size of Convertible Warrants (Rs.) Amount received @10 per warrant Amount utilized
1 550 550 550

DEPOSITS:

The Company has not accepted or renewed any deposits from publicfalling within the purview of Section 73 of Companies Act 2013 and the Companies(Acceptance of Deposits) Rules 2014.

CORPORATE SOCIAL RESPONSIBILITY:

The Company does not fall under the criteria mentioned in Section 135of the Companies Act 2013 ("the Act") read with the Companies (Corporate SocialResponsibility Policy) Rules 2014 and accordingly the Company is not required toconstitute CSR Committee and to spend any amount towards CSR Activity during reportingfinancial year.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Pursuant to the provisions of Section 152 and other applicableprovisions if any of the Companies Act 2013 Shri Archit K. Amin (DIN:01681638) WholeTime Director of the Company is liable to retire by rotation at the forthcoming AnnualGeneral Meeting and he is being eligible offers himself for re-appointment.

In terms of the provision of Section 149 of the Companies Act 2013 andRegulation 17(1) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 A Company shall have at least one woman director on the board of theCompany. Your company has Mrs. Archana Amin as Director on the board since 01/04/2009 whois presently the whole-time director of your Company.

Details of Director seeking re-appointment as required under theListing Regulations are provided in the Notice forming part of this Annual Report. Uponexpiration of term of appointment the Board of Directors has recommended reappointment ofShri Kandarp Amin Smt. Archana Amin and Shri Archit Amin as Whole Time Director on theBoard w.e.f. 01st April 2023 01st April 2023 and 12thMay 2023 respectively. Necessary resolutions have been proposed at ensuing Annual GeneralMeeting for getting consent of members. Their re-appointments are appropriate and in thebest interest of the Company.

Your Directors recommend passing resolutions.

Following changes in Director and KMP were taken place during the Year:

1. Shri Rajendraprasad Shah has been ceased from the post ofIndependent Director of the Company w.e.f 14 July 2021.

2. Shri Nikul Patel has been appointed as a Director (Category:Independent Director) of the Company w.e.f 05 August 2021.

The Key Managerial Personnel (KMP) in the Company as per Section 2(51)and 203 of the Companies Act 2013 are as follows

1. Shri Kandarp Amin-Chairman and Whole Time Director

2. Shri Archana Amin - Whole Time Director

3. Shri Archit Amin - Whole Time Director

4. Shri Gajendra Sigh Rajput - Chief Financial Officer

5. Mr. Vijay Boliya–Whole Time Company Secretary (Appointed w.e.f. 01/03/2022)

6. Ms. Anchal Bansal –Whole Time Company Secretary (Ceased w.e.f. 08/02/2022)

None of the Directors of the Company is disqualified for beingappointed as Director as specified in Section 164 (2) of the Companies Act 2013.

Disclosure about receipt of any commission by MD/WTD from a company andalso receiving commission/remuneration from its Holding or Subsidiary pursuant to section197(14) of the Act: Not Applicable

Disclosure on Reappointment of Independent director pursuant to section149(10): Not Applicable as term of appointment of none of the independent directors isexpiring during FY 2021-22 and up to the date of the report.

ANNUAL RETURN:

Pursuant to Section 92 of the Act read with the applicable Rules theAnnual Return for the year ended 31st March 2022 will be accessed on the Company'swebsite at www.architorg.com.

CORPORATE GOVERNANCE REPORT:

In terms of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a Report on "Corporate Governance" is attached as an AnnexureC and forms part of this report.

DIRECTORS' RESPONSIBILITY STATEMENT :

Pursuant to the provisions of Section 134(5) of the Companies Act 2013with respect to the Directors' responsibility Statement the Directors' confirmsthat:

i. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanations relating to material departures if any;

ii. they have selected such appropriate accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year on 31st March 2022 and of the profit of the Company for theyear under review;

iii. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

iv. they have prepared the accounts for the period ended on 31st March 2022on a going concern basis.

v. They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and operating effectively; and

vi. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

NUMBER OF BOARD MEETINGS:

During the year the Board of Directors duly met Ten (10) times. Thedetails of the Board Meetings are provided in the Corporate Governance Report which isannexed to the Report.

INSURANCE:

The properties and assets of the Company are adequately insured.

DECLARATION BY INDEPENDENT DIRECTORS:

Pursuant to the provisions of Section 134 of the Companies Act 2013with respect to the declaration given by the Independent Directors of the Company underSection 149 (6) of the Companies Act 2013 the Board hereby confirms that all theIndependent Directors have given declarations and further confirms that they meet thecriteria of Independence as per the provisions of Section 149(6) and Regulation 25 of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and they areindependent to the Management of the Company.

PERFORMANCE EVALUATION OF THE BOARD COMMITTEES AND INDEPENDENTDIRECTORS:

Pursuant to the provisions of the Companies Act 2013 and Rules framedthereunder read with Regulation 17 and Regulation 25 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 formal annual evaluation is to be made by theBoard of its own performance and that of its Committees and Individual Directors. TheBoard after taking into consideration the criteria of evaluation laiddown by theNomination and Remuneration Committee in its policy such as Board Composition level ofinvolvement performance of duties attendance etc. hade valuated its own performance theperformance of its committees and Independent Directors (excluding the Director beingevaluated).

The performance evaluation of the Chairman and the Non-IndependentDirectors was carried out by the Independent Directors at their separate meeting. TheDirectors expressed their satisfaction with the evaluation process.

During the financial year under review the Independent Directors meton 14th June 2021 interalia to discuss evaluation of Board Committee(s) and IndividualDirectors.

POLICY ON DIRECTORS APPOINTMENT AND POLICY ON REMUNERATION:

Pursuant to the requirements of the Companies Act 2013 the policy onappointment of Board Members and policy on remuneration of the Directors KMPs and otheremployees is attached as Annexure D to this report.

SECRETARIAL AUDIT REPORT:

M/s. Chetan Patel & Associates Practicing Company Secretaries wasappointed as Secretarial Auditor of the Company to conduct secretarial audit for thefinancial year 2021-22 pursuant to the provisions of Section 204 of the Companies Act2013. The Annual Secretarial Compliance Report and Secretarial Audit Report submitted bythem is attached as Annexure E to this report.

COMMENT OF BOARD ON SECRETARIAL AUDITORS' OBSERVATIONS:

With respect to observations of the Secretarial Auditors'

1. Due to oversight filing of CHG-1 for car loan was missed except that company hascomplied all compliance with respect to Car Loan.

2. Due to oversight the attachment of Statement on Impact of Audit Qualifications forthe Financial Year ended on 31st March 2021 was missed in Annual Reporthowever company has prepared the same at the time of publishing financial results andsame published on website of BSE and the Company.

3. Due to oversight one of the instructions of MCA Circular No. 20/2020 regardingmandate for receiving dividend was missed except that all compliance has been done.

CONTRACTS OR AGREEMENTS WITH RELATED PARTIES:

Pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2013 all the contracts andarrangements with related parties entered by the Company during the financial year were inordinary course of Business and on arms' length basis. Details of the transactionsare as mentioned in Annexure G.

During the year the Company has not entered into any materiallysignificant related party transactions which may have potential conflict with the interestof the Company at large. Suitable disclosures as required are provided in IndAS-24 whichis forming the part of the notes to financial Statement.

The policy on Related Party Transactions has been uploaded on thewebsite i.e. www.architorg.com.

DISCLOSURE UNDER RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATIONOF MANAGERIAL PERSONNEL) RULES 2014:

Details pertaining to remuneration and other details as required underSection 197(12) of the Companies Act 2013 and the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is attached as Annexure F of this report.

The statement containing particulars of employees as required undersection 197 of the Companies Act 2013 read with Rule 5(2) of the companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 will be provided upon request. Interms of Section 136 of the Companies Act 2013 the Report and accounts are being sent tothe members and others entitled thereto excluding the information on employees'particulars which is available for inspection by members at the Registered office of theCompany during business hours on working days of the Company upto the ensuing AnnualGeneral Meeting. If any member is interested in obtaining a copy thereof such member maywrite to the Company Secretary in this regard.

INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY:

The Company has adopted internal control system considering the natureof its business and the size and complexity of operations. The Board has adopted thepolicies and procedures for ensuring the orderly and efficient conduct of its businessincluding adherence to the 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 disclosures etc. Themanagement is taking further steps to strengthen the internal control system.

RISK MANAGEMENT POLICY:

The Company has formulated the Risk Management Policy in order tosafeguard the organization from various risks through timely actions. It is designed tomitigate the risk in order to minimize the impact of the risk on the Business. TheManagement is regularly reviewing the risk and is taking appropriate steps to mitigate therisk.

In the opinion of the Board there has been no identification of elementof risk that may threaten the existence of the Company.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OFTHE COMPANIES ACT2013:

The details of loan provided and investments made if any are asmentioned in the notes to accounts. The Company has not provided any guarantee or securityfalling under purview of Section 186 of the Companies Act 2013 during the financial yearunder review.

Board has approved the investment loan guarantee and security limitunder Section 186 upto Rs. 100 crore subject to approval of members in their ensuingannual general meeting the same is proposed in the ensuing 29th AGM.

STATUTORY AUDITORS:

In terms of the provisions of Section 139 of the Companies Act 2013the Board has recommended the appointment of M/s. G. K. Choksi & Co. CharteredAccountants (Firm Reg. no. 101895W) as the Statutory Auditors of the Company in place ofM/s. Chirag R. Shah & Associates Chartered Accountants (Firm Registration Number-118791W) for a term of five consecutive years to hold office from the conclusion of thisAnnual General Meeting (AGM) till the conclusion of the AGM to be held for the financialyear ending on March 31 2027 on the remuneration as may be decided by Board inconsultation with the Statutory Auditors. Written consent cum certificate of the proposedauditors containing that the appointment if made shall be in accordance with theconditions specified in Rule 4 of the Companies (Audit and Auditors) Rules 2014 has beenreceived.

The Statutory Auditors' Report on the financial statements of theCompany for the financial year ended on 31st March 2022 is self-explanatoryexcept for the effects of the matter described in the basis for Qualified Opinion otherthan that do not call for further explanations or comments.

COMMENT OF BOARD ON AUDITORS' OBSERVATIONS:

With regard to the observation of auditors relating to Non provision ofthe option loss including interest the management has given proposal to HDFC for amicablesettlement for amount of rupees of Eleven lakhs as full and final amount.

INTERNAL AUDITOR

M/s. S. N. Shah & Associates Chartered Accountants Ahmedabad hasbeen appointed as Internal Auditors of the Company. Internal Auditors are appointed by theBoard of Directors of the Company on a yearly basis based on the recommendation of theAudit Committee. The Internal Auditor reports their findings on the Internal Audit of theCompany to the Audit Committee on a yearly basis. The scope of internal audit is approvedby the Audit Committee.

COST AUDITOR

Your Company has appointed Rajendra Patel & Associates CostAccountants Ahmedabad as Cost Auditor of your Company to audit the cost records for thefinancial year 2022-23. As per Section 148 read with Companies (Audit and Auditors) Rules2014 and other applicable provisions if any of the Companies Act 2013subject to theratification bythe members at the ensuing Annual General Meeting at such remuneration tobe paid of Rs. 90000 (Rupees Ninety Thousand Only) excluding GST (if applicable) and outof pocket expenses if any.

MAINTENANCE OF COST RECORDS:

The Directors of the Company to the best of their knowledge and beliefstate that the Company has maintained adequate Cost records as required to be maintainedby the Company under the provisions of Section 148 of the Companies Act2013 read with therelevant Rules framed thereunder.

DISCLOSURE OF AUDIT COMMITTEE:

The Audit Committee of the Company as on 31st March 2022consists of following Directors as its members:

1. Shri Bhupendra Mehta -Chairman

2. Shri Sheeraj Desai -Member

3. Shri Rajendra Shah - Member

VIGIL MECHANISM :

Pursuant to provisions of Section 177(9) of the Companies Act 2013 andRule 7 of the Companies (Meetings of Board and its Powers) Rules 2014 read with SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board ofDirectors had approved the Policy on Vigil Mechanism/ Whistle Blower Policy. Through thispolicy Directors Employees or business associates may report the unethical behaviormalpractices wrongful conduct frauds violations of the Company's code etc. to theChairman of the Audit Committee.

The vigil mechanism / whistle blower policy is also available on thewebsite of the Company www.architorg.com.

COMPOSITION OF INTERNAL COMPLAINTS COMMITTEE UNDER THE SEXUALHARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:

The Company has complied with the provision relating to constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. Further no case has been receivedunder the said act during the year.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO:

The information pertaining to conservation of energy technologyabsorption Foreign exchange Earnings and outgo as required under Section 134 (3)(m) ofthe Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 isfurnished in Annexure A which is attached to this report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS:

The Company has not received any significant or material orders passedby any regulatory authority court or tribunal which shall affect the going concern statusof the Company's operations as on date of this report.

INDUSTRIAL RELATIONS:

The Company has maintained cordial relations with the employees of theCompany throughout the year. The Directors wishes to place on record sincere appreciationfor the services rendered by the employees of the Company during the year.

COMPLIANCE OF SECRETARIAL STANDARD:

The Company has complied with the applicable secretarial standards.

ACKNOWLEDGEMENT:

The Board is thankful to its bankers for their continued support andassistance which has played important role in progress of the Company.

Your Directors places on records the contribution of employees of theCompany at all levels and other business associates for their commitment dedication andrespective contribution to the Company's operations during the year under review.

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