Aries Agro Ltd.
|BSE: 532935||Sector: Agri and agri inputs|
|NSE: ARIES||ISIN Code: INE298I01015|
|BSE 00:00 | 17 Sep||147.65||
|NSE 00:00 | 17 Sep||149.00||
|Mkt Cap.(Rs cr)||192|
|Mkt Cap.(Rs cr)||191.94|
Aries Agro Ltd. (ARIES) - Director Report
Company director report
Aries Agro Limited
Your Directors have pleasure in presenting their 50th AnnualReport on the operations of the Company together with the Audited Financial Statements forthe Financial Year ended 31st March 2020.
(Rupees in Lakhs unless stated otherwise)
During the year under review the Earnings Before InterestDepreciation and Tax was 18.23% compared to 19.81% in the previous year. The Total Revenue(excluding Other Income) for the year net of discount / rebates was Rs. 29614.46 Lakhs asagainst Rs. 26531.65 Lakhs in the previous year. Profit after tax for the year was 5.27%compared to 5.62% in the previous year.
CONSOLIDATED FINANCIAL STATEMENT
In accordance with the Indian Accounting Standard (Ind-AS) 110 onConsolidated Financial Statements the Audited Consolidated Financial Statement isprovided in the Annual Report.
The Consolidated Profit Before Interest Depreciation ExceptionalItems and Taxes (EBITDA) of the Group was Rs. 4701.68 Lakhs in the Financial Year 2019-20compared to Rs. 4690.11 Lakhs in the previous year. Consequently the Consolidated ProfitBefore Exceptional Items and Taxes (PBT) was Rs. 1611.85 Lakhs in the Financial Year2019-20 compared to Rs. 1554.11 Lakhs in the previous year.
With the collective support of staff and Aries Customers the Companywas able to improve its revenue from Indian operations by 15.98 % with an increase inprofitability before tax by 1.53% in comparison with the previous year.
The global manufacturing operations remained suspended. However theprocess of connection of electricity lines is under way. Once the production line isrestarted and Aries flagship brand is manufactured in granules this will be in the bestinterest of the Company's profitability Please refer to the discussion made in theManagement and Discussion Analysis Report forming part of this Report.
IMPACT OF COVID-19 ON THE BUSINESS OF THE COMPANY
The Company has paid an Interim Dividend at Rs. 0.50 per share (5 %)aggregating to Rs. 6503756/- plus Dividend Distribution Tax of Rs. 1336866/- as perthe resolution passed by the Board through Circulation on 11th March 2020. Thesame was paid on 27th March 2020 to the Members whose name appeared on theRegister of Members on the Record Date i.e. 21st March 2020.
In order to preserve the resources for the internal use by the Companyyour Directors have not recommended any Final Dividend for the Financial Year ended 31stMarch 2020. The Interim Dividend paid on 27th March 2020 be treated as FinalDividend.
TRANSFER TO RESERVES
The Board of Directors has decided to retain the entire amount ofProfit for Financial Year 2019-2020 in the Statement of Profit and Loss aggregating to Rs.9787.03 Lakhs.
The Company has completed the process of digitizing its entire bookingprocess using its digital application. As a result even during the lockdown conditionsorder booking of Rs. 620.51 crores was generated online. In addition there will beadditional orders from customers who have not participated in the online booking process.
The demand condition in the first Quarter have been very positive andwe see good prospects and revenue growth using the existing line of products. In additionthe Company will introduce high density Zinc tablets high density NPKs Neem Oil smallrange of pesticides and specially designed nutrients for urban gardens and hydroponicfarms.
However cost conditions are volatile due to the extended lockdownwhich covered almost the entire summer and monsoon. This created high logistic costsunavailability of factory labour and volatile USD and fuel rates. Therefore CostManagement is a top priority and every step will be taken to control costs and maintainprofitability despite of rising cost conditions.
In addition the Company will reintroduce its products in theinternational markets. The good progress of monsoon during Kharif 2020 and adequate labourin the rural areas will ensure that revenue growth in the current Financial Year issatisfactory.
The Company changed the Credit Rating Agency from M/S CARE Ratingsto BRICKWORK RATINGS.
The Credit Rating of the Company was revised during the year BRICKWORKRATINGS as under:
The rating reflect moderate degree of safety regarding timely servicingof financial obligations.
CHANGES IN NATURE OF BUSINESS AND REVISION IN THE BOARD'S REPORT
There is no change in the nature of business of the Company during theyear. There is no revision made in the Board's Report and whatever submitted herewith isthe final Report.
SAFETY AND HEALTH
The health and safety of the employees across its operations remainsthe highest priority for the Group. All endeavours are being made to enhance safetystandards and processes towards minimising safety risks in all operations in the Company.There was no accident or mishap in any of its four factories.
Safety measures for dealing with Covid-19
1. Strict travel of all employees only by private vehicle/own bike orby bus provided by the company.
2. Every employee to record body temperature before leaving the houseusing a simple home thermometer and submission of the readings daily on Aries App.
3. The temperature is recorded at entry point of office/depot/ branchesduring arrival and departure of all employees and every person who enters theoffice/depot/branches.
4. Every person entering the Company premises to compulsorily passthrough the sanitizer tunnel and also get UV screened before entering.
5. Social distancing at all times for all employees while in theCompany premises.
6. Mandatory wearing of mask for all employees while in the Companypremises.
7. Sanitization of workspace at least three times a day.
8. Touch free sanitizers installed all the over the office/depot/branch premises.
9. All meetings are conducted using digital platforms to minimize faceto face proximity.
10. Travel history of all employees has been collected. They areadvised to report any travel done outside city limits immediately to HR.
11. Instructions given to employees to order a Swab Test immediatelyif anyone at home is having COVID-19 symptoms and not to report for duty. Any personstaying at home or quarantined due to symptoms is instructed to submit Negative Covid-19Report while resuming duty.
12. Employees are advised to take immunity boosting medication or homeremedies and eat balanced meals home cooked food.
13. All Aries staff and workers are covered under COVID-19 groupinsurance to take care of some of the expenses in case of any eventuality
14. Visitors entry are completely banned into the Company premises andin case of anyone visiting have to compulsorily fill the visitor declaration form in linewith the Covid 19 SOP issued by the MOH at least 24 hours prior to the arrival into theCompany's premises.
15. Using digital remote working & collaboration platform to ensurefull preparedness for sudden lockdowns if any in future.
The Company has not accepted any deposits from the Public within themeaning of Section 73 of the Companies Act 2013 and Members (other than Directors) duringthe year under review and as such no amount on account of Principal or Interest onDeposits from Public and Members (other than Directors) was outstanding as on 31stMarch 2020.
SUBSIDIARIES & ASSOCIATE COMPANIES
Your Company has four Subsidiaries out of which three are NonMaterialIndian Subsidiaries viz Aries Agro Care Private Limited Aries Agro Equipments PrivateLimited and Mirabelle Agro Manufacturing Private Limited and one foreign subsidiary namelyGolden Harvest Middle East FZC(Amarak Chemicals FZC ceased to be a Step Down Subsidiaryduring the Year).
The operations of Aries Agro Care Pvt. Ltd. commenced in the FinancialYear 2008-09 but discontinued the activity in the financial year 2012-13 due to extremelyvolatile nature of seeds business and had no business activity in the financial year2019-2020 . The Company incurred expenses to the tune of Rs. 2.62 Lakhs for the FinancialYear.
The business operations of Aries Agro Equipments Pvt. Ltd. commenced inthe year 2009-10 in agricultural sprayers but discontinued the activity in the financialyear 2013-14 due to lack of appropriate distribution network for Farm Equipments and hadno business activity in the financial year 2019-2020. The Company incurred expenses to thetune of Rs. 0.60 Lakhs for the Financial Year.
Mirabelle Agro Manufacturing Private Limited was incorporated on 26thDecember 2019. The Company's business activities did not start during the Financial Year2019-2020.
The above three Companies are Wholly Owned Subsidiaries of the Company.
As regards the overseas subsidiary M/S. Golden Harvest Middle East FZCa Trading Entity in their Eleventh Year of operation has not generated any sale and hasincurred Loss of AED 35.18 Lakhs (INR 693.28 Lakhs) for the year 2019-2020 since tradingrevenue did not materialize for licensing reasons.
As required under S. 129(3) of The Companies Act 2013 annexed heretoare the Audited Financial Statements for the Year ended 31st March 2020 ofGolden Harvest Middle East FZC. Aries Agro Care Private Limited Aries Agro EquipmentsPrivate Limited and Mirabelle Agro Manufacturing Private Limited.
A Statement in Form AOC-1 of Subsidiary Companies as prescribed underSection 129(3) of The Companies Act 2013 read with Rule 5 of Companies(Accounts) Rules2014 is annexed and is forming part of the Annual Report.
Apart from the above statement a list of Subsidiary & GroupCompanies is given in Note No. 36 of the Notes to Accounts and is forming part of theAnnual Report.
All the above Indian Subsidiary and Group Companies are Un-listed andNon-Material Companies as defined under Listing Regulations. There is no Associate orJoint Venture Companies other than as listed above.
All properties and assets of your Company are adequately insuredcovering all conceivable risks.
DIRECTORS & KEY MANAGERIAL PERSONNEL DIRECTORS
There is no change in the Composition of the Board of Directors duringthe year under review.
Pursuant to the provisions of Section 152(6) of the Companies Act2013 Mrs. Nitya Mirchandani Director retires by rotation and being eligible offersherself for re-appointment. Accordingly her re-appointment forms part of the Notice ofensuing Annual General Meeting.
All the Independent Directors have submitted declarations to the effectthat each of them meets the criteria of Independence as provided in Section 149(6) of theCompanies Act 2013 and Listing Regulations and there has been no change in thecircumstances which may affect their status as an Independent Director during the year.
Section 149(10) of the Act provides that an Independent Director shallhold office for a term of five consecutive years on the Board and shall be eligible forre-appointment on passing a Special Resolution by the Company and disclosure of suchappointment shall be made in its Board's Report. Section 149(11) provides that anIndependent Director may hold office for up to two consecutive terms.
During the year the Non-Executive Directors of the Company had nopecuniary relationship of transactions with the Company.
Familiarisation Programme for Independent Directors Though thereis no formal Policy for familiarization but the Company in order to familiarize theIndependent Directors with the business of the Company presentation was made by theFunctional Heads covering Operations of the Company at every Quarterly board meeting andnature and scope of business nature of industry in which Company operates profitabilityand future plans. Regularly at meetings updates are given to the Board. House Journal asand when published is also sent to all the Directors and their feedback are considered.Action Taken Report and Legal Updates are also being placed at every meeting of the Boardand Audit Committee just to keep the Directors updated with the latest amendments andAction Taken by the Management.
KEY MANAGERIAL PERSONNEL
Dr. Rahul Mirchandani was appointed as the Managing Director of theCompany for a period of 5(Five) years from 4th April 2017 to 31stMarch 2022 and his remuneration was fixed for a period of 3(three) years from 4thApril 2017 to 31st March 2020 by the Board of Directors in their Meeting heldon 27th April 2017 pursuant to the recommendation of the Nomination andRemuneration Committee which was approved by the Members in the 47th AnnualGeneral Meeting held on 28th September 2017.
The period of 3(three) years got over on 31st March 2020the Board of Directors in their Meeting held on 11th February 2020 pursuantto the recommendation of the Nomination and Remuneration Committee revised theRemuneration of Dr. Rahul Mirchandani with effect from 1st April 2020 forremainder of his tenure of 2(two) years upto 31st March 2022 subject to theapproval of the Members at the ensuing Annual General Meeting and the same forms part ofthe Notice of ensuing Annual General Meeting.
Mr. S. Ramamurthy who had attained the Superannuation on 26thApril 2013 and was on extended employment till 31.03.2022 relinquishing the position ofPresident and Chief Financial Officer of the Company with effect from the end of theworking hours on 5th November 2019 due to his health reasons. Mr. Ramamurthywas
relieved from his position of Chief Financial Officer with effect fromthe end of the working hours on 5th November 2019.
Mr. Vivek K. Joshi a Chartered Accountant who was appointed as theDeputy Chief Financial Officer of the Company with effect from 9th September2019 with the intention of smooth transition to the post of Chief Financial Officer waselevated to the position of Chief Financial Officer of the Company with effect from 9thDecember 2019.
Apart from the above there were no other change in the Key ManagerialPersonnel during the year under review. All the Key Managerial Personnel have submitteddisclosures and declaration required under the Companies Act 2013 and ListingRegulations.
MEETINGS OF BOARD
Five(5) Meetings of the Board of Directors were held during the year.For further details please refer Report on Corporate Governance of this Annual Report.
The Audit Committee was re-constituted with effect from 16thMay 2019 by inducting Mr. C. B. Chhaya in the Committee.
All the recommendations made by the Audit Committee were accepted bythe Board during the year under review.
There was no change in the CSR Committee during the year. The Committeecomprises of Dr. Rahul Mirchandani(Chairman) Shri. B. V. Dholakia and Mrs. NityaMirchandani. For further details please refer Report on Corporate Governance of thisAnnual Report.
STAKE HOLDERS RELATIONSHIP COMMITTEE
There was no change in the Stake Holders Relationship Committee duringthe year. The Committee comprises of Mr. C. B. Chhaya(Chairman) Dr. Rahul Mirchandani andMrs. Nitya Mirchandani. For further details please refer Report on Corporate Governanceof this Annual Report.
The Board of Directors have carried out an Annual Evaluation of its ownperformance and individual Directors themselves pursuant to the provisions of the Act andCorporate Governance requirements as prescribed by Regulation 17(10) of the SEBI(LODR)Regulations 2015.
The performance of the Board was evaluated by the Board after seekinginputs from all the Directors on the basis of criteria such as the Board Composition andStructure Effectiveness of Board Process Information and Functioning etc.
In a separate Meeting of the Independent Directors performance ofNon-Independent Directors Performance of the Board as a whole and performance of theChairman was evaluated taking into account the views of Executive Directors andNon-Executive Directors.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHERDETAILS
The Policy on Directors Appointment and Remuneration including criteriafor determining qualifications positive attributes independence of Director and alsoRemuneration for Key Managerial Personnel and other Employees are contained in theNomination and Remuneration Policy which is hosted at the web site of the Companywww.ariesagro.com and the same is re-produced in the Report on Corporate Governance.
DIRECTORS' RESPONSIBILITY STATEMENTS
Pursuant to the requirements of Section 134(5) of the Companies
Act 2013 the Board of Directors to the best of their knowledge and
ability confirm that:
1. in preparation of the Annual Accounts applicable AccountingStandards have been followed and that there are no material departures;
2. they have selected such Accounting Policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the State of the Affairs of the Company at the end of thefinancial year and of the profit of the Company for that year;
3. they have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
4. they have prepared the Annual Accounts on a going concern'basis;
5. they have laid down Internal Financial Controls to be followed bythe Company and such Internal Financial Controls are adequate and operating effectively;
6. they have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
The information required under Section 197 of the Companies
Act 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules 2014 are as under:
1. The ratio of the remuneration of each Director to the medianremuneration of the employees of the Company for the financial year;
2. The percentage increase in remuneration of each Director ChiefFinancial Officer Company Secretary or Manager if any in the financial year;
3. The percentage increase in the median remuneration of employees inthe financial year; -4.23 %
4. The number of permanent employees on the rolls of Company; 922
5. Average percentile increase already made in the salaries ofemployees other than the managerial personnel in the last financial year and itscomparison with the percentile increase in the managerial remuneration and justificationthereof and point out if there are any exceptional circumstances for increase in themanagerial remuneration;
The average annual increase was around 7.88% after accounting forpromotions and other event based compensation revision.
6. Affirmation that the remuneration is as per the Remuneration Policyof the Company.
The Company affirms that the remuneration is as per the RemunerationPolicy of the Company.
The Statement containing Particular of Employees as required underSection 197(12) of the Companies Act 2013 read with Rules 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 drawing remunerationin excess of the limits set out in the said Rules are provided in the Annual Report.
Information in accordance with the provisions of Section 197(12) of theCompanies Act 2013 ("Act") read with Rule 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are as under:
TOP 10 EMPLOYEES IN TERMS OF REMUNERATION DRAWN DURING THE YEAR 2019-20
* Mr. S. Ramamurthy was in employment upto 5th November2019 ** Mr. Vivek K. Joshi was elevated as CFO we.e.f. 09.12.2019
PARTICULARS OF EMPLOYEES IN TERMS OF SECTION 197(12) OF THE COMPANIESACT 2013 READ WITH RULE 5(2) AND 5(3) OF THE COMPANIES(APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES 2014 DRAWING REMUNERATION NOT LESS THAN Rs. 1.02 Croresp.a./Rs. Eight Lakhs Fifty Thousand p.m. DURING THE YEAR 2019-20
The Company has not offered any ESOPS scheme to its Employees orDirectors.
RISK MANAGEMENT AND INTERNAL FINANCIAL CONTROLS
Your Company has elaborate Risk Management Procedure which is based onthree Pillars. Business Risk Assessment Operational Controls Assessment and PolicyCompliance processes. Major Risks identified by the Business and Functions aresystematically addressed through mitigating actions on continuing basis. The Key risks arealso discussed at the Audit Committee.
The Company's Internal Financial Control System is commensurate withthe nature of its business and the size and complexity of its operations. These areroutinely tested and certified by the Statutory as well as Internal Auditors covering allOffices Factories and Key Business areas. Significant Audit Observations and Follow UpActions thereon are reported to Audit Committee. The Audit Committee reviews adequacy andeffectiveness of the Company's Internal Control environment and monitors theimplementation of the audit recommendations.
Based on the framework of Internal Financial Controls and ComplianceSystem established and maintained by the Company work performed by the InternalStatutory and Secretarial Auditors and review performed by the Management and the relevantBoard Committees including the Audit Committee the Board is of the opinion that theCompany's Internal Financial Controls were adequate and effective during the FinancialYear 2019-20.
Pursuant to Sections 101 and 136 of the Companies Act 2013 the Companywill be sending Annual Report through electronic mode(email) to all the shareholders whohave registered their email addresses with the Company or with the Depository to receivethe Annual Report through electronic mode and initiated steps to reduce consumption ofpaper.
Humans are considered as one of the most critical resources in thebusiness which can be continuously smoothened to maximize the effectiveness of theOrganization. Human resources build the Enterprise and the sense of belonging wouldinculcate the spirit of dedication and loyalty amongst them towards strengthening theCompany's Polices and Systems. All personnel continue to have healthy cordial andharmonious approach thereby enhancing the contributory value of the Company.
The Equity Shares of the Company are listed at BSE Limited (BSE) andNational Stock Exchange of India Limited(NSE).
The Company has made all the compliances of Listing Regulationsincluding payment of Annual Listing Fees upto 31st March 2021 to both theStock Exchanges.
The Company has complied with the various requirements under theCorporate Governance reporting system. A detailed Compliance Report on CorporateGovernance is annexed to this Report as required by the Listing Regulations. The Auditors'Certificate on Compliance with the conditions of Corporate Governance is also annexed tothis report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under reviewas stipulated under Listing Regulations with the Stock Exchanges is also annexed to thisreport.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNING & OUTGO
Particulars in respect of Conservation of Energy Technology Absorptionand Foreign Exchange Earnings and Outgo as required to be disclosed by theCompanies(Accounts) Rules 2014 and forming a part of the Directors Report are as under: -
I. CONSERVATION OF ENERGY
The Company accords great importance to conservation of energy. Themain focus of the Company during the year was:
a. Energy Conservation measures taken:-
i. Close monitoring of consumption of electricity LPG Diesel andwater.
ii. Creating awareness among Workmen to conserve energy.
iii. Aries continues power generation through its Solar PowerGeneration System at its manufacturing unit in Hyderabad.
iv. Conversion of boilers in Hyderabad Unit from diesel to solidbriquette based fuel.
v. Exclusive use of CNG for manufacturing at Chhatral Unit
vi. Optimum use of Energy by Switching off Machines Lights Fans AirConditioners and Exhaust Systems whenever not required
Impact of measures taken for reduction of energy consumption andconsequent impact on the cost of production of goods
b. Total energy consumption and energy consumption per unit ofproduction
Form for disclosure of Particulars with respect to Conservation ofEnergy.
II. Form for disclosure of particulars with respect to
Technology Absorption Research and Development
(A) RESEARCH AND DEVELOPMENT:
1. Specific Areas in which Research and Development was carried out bythe Company.
There is a continuous focus on University research on specialtyplant nutrition which continues across India.
Our team of extension officers conducts continuous fielddemonstrations and extension work including large scale soil sampling which providesconstant updates on deficiency levels across all states in India.
The Company's R&D at Mumbai is NS-EN ISO 9001:2015 certifiedand works on new product development and continuous quality checks. The manufacturing unitat Hyderabad has been equipped with a state of art laboratory to keep pace with theCompany's expansion in that region.
Hydroponic/ Soilless Cultivation has been taken up on therooftop as a new age method of cultivation in urban set ups
Develop new markets in the Protected Cultivation sector
Innovate and develop products ideally suited for sustainableagriculture
Develop new production processes to improve the costeffectiveness of its products as well as their agronomical efficiency.
Develop production processes that utilize renewable and arepollution free.
Ensure continuous updation of in house knowledge required todevelop products and services for the company.
Source worldwide information related to product development andagriculture best practices
Develop new age environmental friendly crop managementtechniques
3. Benefits derived as a result of the above efforts.
Improvement in productivity/quality and reduction in cost ofproduction of Company's Plants and at Customer's end.
Cost reduction import substitution safer environment andstrategic resource management.
Meeting the statutory requirements.
Demonstration of a Sustainable urban farm set up to address theissue of pesticide free healthy food
4. Future Plan of Action :
Conducting scientific research and studies pilot scaledevelopment trial and testing for development of new products new process developmentimprovement in the existing production process etc
Customized micronutrient fertilizers for export
Set-up of Demo Farm in Raipur
Modification of manufacturing process to make it pollution free
Setting up of Boric acid plant
Efforts to develop India GAP on commercial crops and tryestablishing a linkage between farmers and the industry
Initial work on nano fertilizers
5. Expenditure on R & D
B1. Technology Absorption Adaptation and Innovation
The Management has focused on productivity and Total Quality Management[TQM] in order to optimize manufacturing costs. The Company continues to be NS-EN ISO9001:2015 certified.
This has helped in achieving optimum manufacturing costs improvedquality of products and consequently enhanced customer satisfaction. The Company usesindigenous technology.
B3. The Company has not imported any technology during the year underreview.
C. Foreign Exchange Earnings and Outgo
1. Activities relating to exports initiatives taken to increaseexports development of new export markets for products and services and export plans:
International clients are located in Nepal and Taiwan. Sales werebooked for Nepal and Taiwan. Distributors in Nepal have put up their own manufacturingunit to support and increase sales and distribution network throughout Nepal. The totalexports and global sales constituted 0.08 % of our group revenue during the Financial Year2019-20. (This adds upto
0.26% including Nepal Exports in INR).
2. Total Foreign Exchange used and earned:
Used : Rs. 314751871/- Earned: Rs. 2467931/- SPECIAL BUSINESS
As regard to the items of the Notice of the AGM relating to SpecialBusiness the resolutions incorporated in the Notice and the Explanatory Statementrelating thereto fully indicate the reasons for seeking the approvals of members to thoseproposals. Your attention is drawn to these items and Explanatory Statement annexed to theNotice.
The Vigil Mechanism of the Company which also incorporates a WhistleBlower Policy in terms of the Listing Regulations is in place.
Protected disclosures can be made by a Whistle Blower in writing orthrough an e-mail to the Chairman/Member of the Audit Committee.
The Policy on Vigil Mechanism and Whistle Blower Policy may be accessedon the Company's website www.ariesagro.com.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN &SECURITIES PROVIDED
Particulars of Loans given Investments made Guarantees given andSecurities provided along with the purpose for which the Loan or Guarantee or Security isproposed to be utilized by the recipient are provided in the Standalone FinancialStatements.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
None of the transactions with Related Parties falls under the scope ofSection 188(1) of the Companies Act 2013. Information on transactions with Relatedparties pursuant to Section 134(3)(h) of the Companies Act 2013 read with Rule 8(2) ofthe Companies (Accounts) Rule 2014 are given in Annexure-I in Form AOC-2 and thesame forms part of this Report.
CORPORATE SOCIAL RESPONSIBILITY
The brief outline of the Corporate Social Responsibility (CSR) Policyof the Company and the initiatives undertaken by the Company on CSR activities during theyear are set out in Annexure-II of this Report in the format prescribed in theCompanies (Corporate Social Responsibility Policy) Rules 2014. The Policy is available onthe Web-Site of the Company at www.ariesagro.com.
Your Company continues to demonstrate a strong commitment towardsproviding products which do not hamper the soil and crop eco systems.
EXTRACTS OF ANNUAL RETURN
As provided under Section 92(3) of the Companies Act 2013 the Extractof the Annual Return is given in Annexure-III in prescribed Format MGT-9 whichforms part of this Report. The said Extract of the Annual Report is available at the website of the Company at www.ariesagro.com. The complete Annual Return is also available onthe Company's at www.ariesagro.com.
AUDITORS & AUDITORS REPORTS Statutory Auditors
M/s. Sandeep Sheth & Associates Chartered AccountantsMumbai(Membership No. 101903 and having Peer Review Certificate issued by the Instituteof Chartered Accountants of India) were appointed as the Statutory Auditors of theCompany for a period of 5(five) years at the Forty Seventh Annual General Meeting of theCompany held on 28th September 2017 and being eligible continue to be theStatutory Auditors.
The Statutory Auditors' Report both with respect to the Standalone andConsolidated Financial Statements do not contain any qualification reservation or adverseremark. Further that there was no fraud reported by Auditors under sub-section (12) ofSection 143 of the Companies Act 2013 other than those reportable to the CentralGovernment.
The Company has appointed M/s. R. Nanabhoy & Co. Cost Accountantsto conduct the Audit of Cost Accounting Records of its products for the financial year2018-2019.
The due date for filing the Cost Audit Reports in XBRL mode for thefinancial year ended March 312019 was 31st Decmeber 2019. The Cost AuditReports were filed by the Cost Auditor on 27th December
2019 within the due date.
Further M/s. R. Nanabhoy & Co. Cost Auditors were re-appointed asthe Cost Auditor of the Company for the year ending 31st March
2020 by the Board of Directors at their meeting held on 27thMay 2019 after ensuring their eligibility and obtaining the letter of eligibility fromthem.
The Company's Cost Audit for the Financial Year 2019-2020 is underprocess and the Company will have the Audit completed within 180 days of the end of theFinancial Year-2019-2020 i.e. on or before 27th September 2020 and file theReport within 30 days of the Board Meeting approving the Report.
The Board appointed Mr. A. Sekar Practising Company Secretary toconduct Secretarial Audit for the financial year 2019-2020. The Secretarial Audit Reportfor the financial year ended March 312020 is annexed herewith and marked as Annexure-IVto this Report.
The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
The Company has in place proper systems to ensure compliance with theprovisions of the applicable Secretarial Standards issued by The Institute of CompanySecretaries of India and such systems are adequate and operating effectively.
ANNUAL SECRETARIAL COMPLIANCE REPORT
Pursuant to Regulation 24A of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 (ListingRegulations) the Company obtained the Annual Secretarial Compliance Report for theFinancial Year 2019-2020 from Mr. A. Sekar Practising Company Secretary the SecretarialAuditor of the Company and the same has been filed with the BSE Limited and the NationalStock Exchange of India Limited on 30th June 2020 well within the extendedtime of 31st July 2020. The Secretarial Auditor has not reported anynon-compliance.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION & REDRESSAL) ACT 2013.
The Company has zero tolerance towards sexual harassment at theworkplace. The Company has adopted a Policy on Prevention Prohibition and Redressal ofSexual Harassment at Workplace in line with the provisions of the Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013 and the Rulesthereunder.
The Company has complied with the provisions relating to theconstitution of the Internal Complaints Committee as per the Sexual Harassment of Women atWorkplace Prevention Prohibition and Redressal) Act 2013.
There was no complaint received during the year under review.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIALPOSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE FINANCIAL YEAR END OF THE COMPANYTO WHICH FINANCIAL
Except as disclosed elsewhere in this report no material changes andcommitments which could affect the Company's financial position have occurred between theend of the financial year of the Company and date of this report.
MATERIAL ORDERS PASSED
No material Orders have been passed by any Authority in respect of anymatters with regard to the business of the Company during the Financial Year.
Referring to the Previous Year's Board's Report classification ofMicronutrients relating to the Sanand Unit in the state of Gujarat is pending beforeCustoms Excise and Service Tax Appellate Tribunal(CESTAT) at Ahmedabad and Order isawaited.
The Commissioner of Central GST & Central Excise and TheCommissioner of Custom (NS-V) have passed order against the Company for Chhatral &Mumbai facilities respectively. However the Company has in past successfully defendedsuch order at Apex Court. This being similar matter of classification of Chapter headingCompany is confident of getting favorable Order in these matters and hence does notforesee any material impact.
Your Directors state that no disclosure or reporting is required inrespect of the following items as there were no transactions on these items during theyear under review:
1. Details relating to deposits covered under Chapter V of the Act.
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.
4. Buy Back of shares of the Company during the year under review.
5. The Managing Director of the Company does not receive anyremuneration or commission from any of its Subsidiaries.
6. No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern status and Company's operations infuture.
7. The Company is not required to submit Business Responsibility Reportin pursuance of Regulation 34(2)(f) SEBI(LODR) Regulations 2015.
None of the Directors of your Company is disqualified as per provisionsof Section 164(2) of the Companies Act 2013. Your Directors have made necessaryDisclosures as required under various provisions of the Companies Act 2013 and theSEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
We would like to acknowledge with gratitude the support andcooperation extended by Shareholders Vendors Media Registrar and Share Transfer Agentand Banks and look forward to their continued support. We appreciate continuedco-operation received from various regulatory authorities including Department ofAgriculture Department of Corporate Affairs Registrar of Companies Reserve Bankof India Securities and Exchange Board of India Stock Exchanges Depositories CentralGovernment and respective State Governments. We also recognize and appreciate the sincerehard work loyalty and efforts of the employees and look forward to their continuedsupport.