You are here » Home » Companies » Company Overview » Asahi Songwon Colors Ltd

Asahi Songwon Colors Ltd.

BSE: 532853 Sector: Industrials
NSE: ASAHISONG ISIN Code: INE228I01012
BSE 00:00 | 30 Nov 265.75 2.45
(0.93%)
OPEN

266.85

HIGH

267.00

LOW

262.30

NSE 00:00 | 30 Nov 265.50 2.70
(1.03%)
OPEN

267.95

HIGH

267.95

LOW

262.80

OPEN 266.85
PREVIOUS CLOSE 263.30
VOLUME 477
52-Week high 346.45
52-Week low 226.00
P/E 15.69
Mkt Cap.(Rs cr) 313
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 266.85
CLOSE 263.30
VOLUME 477
52-Week high 346.45
52-Week low 226.00
P/E 15.69
Mkt Cap.(Rs cr) 313
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Asahi Songwon Colors Ltd. (ASAHISONG) - Director Report

Company director report

To the Members of

Asahi Songwon Colors Limited

Your Directors' take pleasure in presenting their 32ndAnnual Report on the business and operations of the Company together with the AuditedFinancial Statements both Standalone and Consolidated for the Financial Year ended March31 2022.

Financial Highlights

The Company's standalone and consolidated financial performance for theyear ended March 31 2022 is summarised below:

(Rs in lakhs)

Particulars Standalone Consolidated
2021-2022 2020-2021 2021-2022 2020-2021
Revenue from Operations 40564.82 28294.48 41537.82 28308.02
Other Income 166.22 252.90 88.62 31.02
Total Income 40731.04 28547.38 41626.44 28339.04
Profit before Depreciation Finance Cost Exceptional Item and Tax Expenses 4430.59 5066.09 3756.37 4982.18
Less : Depreciation 880.53 843.78 1195.70 869.38
Less : Finance Cost 325.10 191.95 472.42 194.13
Profit before Tax before Exceptional Item 3224.96 4030.36 2088.25 3918.27
Add : Exceptional Items - 445.24 - 445.24
Profit before Tax (PBT) 3224.96 4475.60 2088.25 4363.91
Less : Tax Expenses 806.06 1181.87 623.18 1169.29
Profit after Tax (PAT) 2418.90 3293.73 1465.07 3194.62
Attributable to :
Owners of the Company - - 1935.96 3221.44
Non-Controlling Interest - - (470.89) (26.82)
Other Comprehensive Income/(Loss) (35.49) 786.12 (33.83) 786.12
Total Comprehensive Income 2383.41 4079.85 1432.84 3980.74
Attributable to :
Owners of the Company - - 1902.83 4007.56
Non-Controlling Interest - - (469.29) (26.82)
Opening Balance in Retained Earnings 18716.74 14636.90 18203.68 14641.07
Amount available for appropriation 21100.15 18716.74 20105.81 3562.62
Less : Dividend (including Dividend Distribution Tax) on equity shares 420.95 - 420.95 -
Closing Balance in Retained Earnings 20679.20 18716.74 19684.86 18203.69

Brief Description of the Company's Working During the year/ State ofCompany's Affairs

a. General

Financial year 2021-22 was another tumultuous year where the world wasrecovering post pandemics the war in Ukraine has upended the fragile recovery fromCOVID-19 pandemic triggering a devastating humanitarian crisis in Europe increasingcommodity and food prices and exacerbating inflationary pressures worldwide. The rise inenergy prices supply chain shortages and escalation of geo-political tensions has furtherimpacted global economy growth.

The Indian economy has not remained unscathed by this globaldevelopment. The Indian economy has recovering from repeated waves of COVID-19 virus.India's response to the pandemic has been agile and decisive with the government providingsafety nets for vulnerable sections which responding iteratively with policy support.However the year experienced the unprecedented impact of extraordinary inflationarypressure on the Indian economy.

The market of the Phthalo pigments was also sluggish during the yearwhich challenged the margins. During the year under review your Company had a robustgrowth in top line. However profitability was negatively impacted by an unprecedentedincrease in the prices of coal urea copper and phthalic anhydride. Input price inflationhas been relentless throughout the year with each quarter witnessing higher raw materialprices than the previous quarter. The Company was able to overcome the supply chainchallenges faced in the previous financial year due to the pandemic. Elevated commodityprices impacted the margins across industry. Though the inflationary environment isexpected to pause challenge on the business your Directors are confident that economicactivities will recover gradually and desired growth will be achieved in the comingfinancial year.

b. Performance Review

On Standalone Basis : During the year under review the revenue fromoperation stood at Rs 40565 lakhs compared to Rs 28294 lakhs in the previous year anincrease of 43% compared to previous year. EBIDTA for the Financial Year 2021-2022 stoodat Rs 4264 lakhs with an EBITDA Margin of 10.51%. The Profit after tax (PAT) for thefinancial year 2021-2022 was Rs 2419 lakhs as compared to previous year Rs 3294 lakhs.

On Consolidated Basis : During the year under review the revenue fromoperation stood at Rs 41538 lakhs compared to Rs 28308 lakhs in the previous year.EBIDTA for the financial year

2021-2022 stood at Rs 3668 lakhs with an EBITDA Margin of 8.83%. TheProfit after tax (PAT) for the financial year 2021-2022 was ?1465 lakhs as compared toprevious year Rs 3195 lakhs. The consolidated numbers includes the financial performanceof Asahi Tennants Color Private Limited a Subsidiary Company.

c. Exports

During the year under review the total exports on standalone basiscontributed to Rs 22401 lakhs compared to Rs 16628 lakhs during the previous year. YourCompany continues to view focus export markets for its products competitiveness andseeking profitable opportunities for growth.

Dividend

The Board of Directors at their meeting held on May 19 2022 hasrecommended dividend at a rate of Rs 0.50 per share (5%) of face value of Rs 10/- each onthe fully paid up equity share capital as final dividend for the Financial Year 2021-2022.The payment is subject to the approval of members at the ensuing 32nd AnnualGeneral Meeting ("AGM") of the Company

The final dividend if approved by the members at the ensuing AnnualGeneral Meeting would involve a total outgo of Rs 58.94 Lakhs towards dividend for theyear.

In view of the changes made under the Income Tax Act 1961 by theFinance Act 2020 dividend paid or distributed by the Company shall be taxable in thehands of the shareholders. The Company shall accordingly make the payment of thedividend after deduction of tax at source.

The dividend recommended is in accordance with the DividendDistribution Policy of the Company. The Dividend Distribution Policy in terms ofRegulation 43A of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 ("Listing Regulations") is annexed asAnnexure - "F" and is also available on the Company's website atwww.asahisongwon.com.

Investor Education and Protection Fund

Transfer of Unpaid/ Unclaimed Dividend & Share Application Money toInvestor Education and Protection Fund (IEPF)

Pursuant to the provisions of Section 124(5) of the Companies Act 2013(the Act) unclaimed/ unpaid dividend of Rs 0.86 Lakhs which was lying in the UnpaidDividend Account for the Financial Year 2013-14 was transferred during the year underreview to IEPF. Reminders are sent regularly to the Shareholders who have not claimed thedividend amount to claim the same from the Company failing which the unclaimed dividendlying in the unpaid account for seven years shall be transferred to IEPF within thirtydays from the due date for transfer of unpaid dividend. Unclaimed dividend in respect ofthe financial year 2014-15 is due for transfer to IEPF on September 30 2022.

Transfer of Equity Shares to Investor Education Protection FundAuthority (IEPFA)

In terms of Section 124(6) of the Act read with Rule 6 of the IEPFA(Accounting Audit Transfer and Refund) Rules 2016 (as amended from time to time)shares on which dividend has not been paid or claimed by a shareholder for a period ofseven consecutive years or more shall be transferred to the Demat Account of IEPFA withina period of thirty days of such shares become due for transfer. Upon transfer of suchshares all benefits (like dividend bonus split consolidation etc.) if any accruingon such shares shall also be transferred to the demat / bank Account of IEPF(A) and thevoting rights on such shares shall remain frozen till the rightful owner claims theshares. The Shares transferred to the Demat Account of IEPFA can be claimed back by theshareholder by following the procedure prescribed under the aforesaid rules. During theyear under review the Company has transferred 973 equity shares to IEPFA as dividendhad not been encashed or claimed on the above shares during the seven consecutive yearsfrom the Financial Year 2013-14. Further the Company is in the process to transfer allshares in respect of which dividends declared for the year 2014-2015 or earlier financialyears has not been paid or claimed by members for 7 (seven) consecutive years or more.

Details of Nodal Officer

The details of the nodal officer appointed by the Company under theprovisions of IEPF is given below and the same is disseminated on the website of theCompany www.asahisongwon.com

Name of the Company Mr. Saji Varghese Joseph

Secretary designated as Nodal Officer

Direct Phone No. 079-68325000

Email Id cs@asahisongwon.com

Address: "Asahi House"

13 Aaryans Corporate Park Nr. Shilaj Railway Crossing Thaltej - ShilajRoad Thaltej

Ahmedabad - 380059

Transfer to Reserve

The Company has decided not to transfer any amount to the GeneralReserves for the Financial Year ended March 31 2022.

Share Captial

a. Issue of equity Shares with differential rights

During the year under review Company's issued subscribed and paid-upequity share stood at Rs 1202.73 lakhs divided into

12027262 equity shares of Rs 10/- each. During the year underreview no equity shares with differential rights as to dividend voting or otherwisewhere issued.

b. Issue of sweat equity shares

During the year under review the Company has not issued any sweatequity shares.

c. Issue of employee stock options

The Company has not granted any Employee Stock Option within themeaning of section 62(1) (b) of the Companies Act 2013 read with its Rules framed thereunder and Regulation 14 of the Securities Exchange Board of India (Listing Obligation andDisclosure Requirements) Regulation 2015.

d. Debentures

During the financial year under review your Company do not issue anyDebenture in terms of Section 42 of the Companies Act 2013 read with Rule 14 of theCompanies (Prospectus and Allotment) Rules 2014 and no debentures were redeemed duringthe Financial Year 2021-2022.

Listing

As at March 31 2022 12027262 Equity shares of the Company continueto remain listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE).The Company has paid the Annual Listing Fees to the said Stock Exchange(s) for thefinancial year 2022-2023.

Subsidiaries Joint Ventures and Associate Companies

During the year under review the Company has one material subsidiary:

Asahi Tennants Color Private Limited ("ATC")

Asahi Tennants Color Private Limited ("ATC") is a jointventure between your Company and Tennants Textile Colours Limited England where in yourCompany is holding 51% of total Equity Share Capital and the balance share capital of 49%is held by Tennants Textile Colours Limited England.

Tennants Textile Colours Limited (TTC) is the leading UK manufacturerof colour based beside the River Lagan in Belfast Northern Ireland with solventproduction facility outside Birmingham England. They produce a wide range of colourdispersions (Water & Solvent base) tailored to optimise their suitability for a rangeof markets including Textile Paper Paints & Coatings Ink Agriculture &Plastic. Today they export to over 41 countries globally from their base in the UK.

As on March 31 2022 Asahi Tennants Colors Private Limited is amaterial unlisted subsidiary Company as per the Securities Exchange Board of India(Listing Obligations and Disclosures Requirements) Regulations 2015. The Audit Committeeand the Board review the financial statements significant transactions and working of thesubsidiary company and the minutes of the unlisted subsidiary companies are placed beforethe Board.

Further pursuant to Regulation 24 of Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 requires theBoard of unlisted material subsidiary should have at least one independent director oflisted holding Company and accordingly Dr. Pradeep Jha was appointed as the IndependentDirector on the Board of the subsidiary.

As provided under section 129(3) of the Companies Act 2013 and Rulesmade there under a statement containing the salient features of the financial statementsof its subsidiaries in the format prescribed under the rules is attached to the financialstatements. The policy relating to material subsidiaries as approved by the Board may beaccessed on the Company's website www.asahisongwon.com .

Financial Position and Performance of Subsidiaries Joint Ventures andAssociates

The financial summary of the subsidiary companies are as follows:

(Rs in lakhs)

Particulars 2020-2021 2021-2022
Revenue from Operations 973.42 13.54
Profit Before Tax (1143.90) (67.32)
Profit After Tax (961.01) (54.58)

On the date of this report the Company has two more subsidiaries: AtlasLife Sciences Private Limited

On April 18 2022 the Company acquired 78% stake of Atlas LifeSciences Private Limited a manufacturer of Active pharmaceutical ingredients (APIs) foran all-cash consideration of Rs 4800 Lakhs. Atlas Life Sciences Private Limited is aleading manufacturer of Anti-convulsant Anti-psychotic and Anti-diabetic APIs withstoring focus on product and process research. Its key products includes : PergabalinR-Compound Levosulpiride Amisulpride Glicazide Phenylephrine. As on date Atlas LifeSciences Private Limited is a material subsidiary of the Company.

Atlas Life Sciences (India) Private Limited

On April 28 2022 the Company has incorporated Atlas Life Sciences(India) Private Limited a wholly owned subsidiary of the Company to manufacture ActivePharmaceutical Ingredient and Bulk Drugs. The Company has started construction of plant atChhatral Mehsana Gujarat.

Annual Accounts of Subsidiary Company

As provided in section 136 of the Act the Balance Sheet Statement ofProfit and Loss and other documents of the subsidiary company are not being attached withthe Financial Statements of the Company. The Company have uploaded on its website theAudited Financial Statements of the subsidiary company and the related detailedinformation to any member of the Company who may be interested to receive the same.

The Financial Statements of the subsidiary company will also be keptopen for inspection at the Registered Office of the Company and that of the respectivesubsidiary companies. The Consolidated Financial Statements presented by the Companyinclude financial results of its subsidiary companies and the financial highlights ofsubsidiaries are part of this Annual Report as Annexure-"A" as prescribed inForm AOC-1.

Consolidated Financial Statements

Your Directors have pleasure in attaching the Consolidated FinancialStatements pursuant to the requirement of Regulation 33 & Regulation 34 of theSecurities Exchange Board of India (Listing Obligations & Disclosure Requirements)Regulations 2015 (hereinafter referred as Listing Regulations) read with other applicableprovisions and prepared in accordance with applicable IND AS for financial year endedMarch 31 2022.

Finance and Insurance

The Company has been financed by State Bank of India Federal BankLimited and HDFC Bank Limited for both working capital and term loans.

The Company's Plant Property Equipments and Stocks are adequatelyinsured under the Industrial All Risk Policy. The Company has insurance coverage forPublic Liability Marine Coverage and Commercial General Liability (CGL). The Company hasDirector's and Officers Liability Policy (D&OL) to provide coverage against riskarising on thereon.

Bank Term Loans

During the year under review CARE has reviewed the ratings to"CARE A+": Stable [Single A Plus; Outlook; Stable]" rating assigned to thelong-term facilities of your Company. This rating is applicable to facilities havingtenure of more than one year. Instruments with this rating are considered to have thehighest degree of safety regarding timely servicing of financial obligations.

CARE has also reaffirmed the CARE A1+ [Single A One Plus] ratingassigned to the short-term facilities of your Company. This rating is applicable tofacilities having tenure up to one year. Instruments with this rating are considered tohave adequate degree of safety regarding timely servicing of financial obligations.

This reaffirms the reputation and trust the Company has earned for itssound financial management and its ability to meet its financial obligations.

Public Deposit

During the year under review the Company has not accepted or renewedany fixed deposit from public within the meaning of Section 73 of Companies Act 2013 andread with the Companies (Acceptance of Deposits) Rules 2014 as such no amount ofprincipal or interest was outstanding as on March 31 2022.

Material Changes and Commitments If Any Affecting the FinancialPosition of the Company Which Have Occurred Between the End of the Financial Year of theCompany to Which the Financial Statements Relate and the Date of the Report

There have been no material changes and commitments affecting thefinancial position of the Company since the close of Financial Year i.e. March 31 2022and the date of this report.

Change in the Nature of Business if any

There was no change in the nature of business of the Company during thefinancial year ended March 31 2022.

Details of Significant and Material orders passed by the Regulators orcourts or Tribunals Impacting the going concern status and Company's Operations in Future

The Company has not received any significant or material orders passedby any regulatory authority court or tribunal which shall impact the going concern statusand Company's operations in future.

Business Responsibility Report

In compliance with Regulation 34(2)(f) of the Securities Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 the Companyhas prepared a Business Responsibility Report which forms part of this Annual Report asper Annexure - "J".

Board Of Directors and its Committees

Composition of the Board of Directors

As on March 31 2022 the Board of Directors of the Company comprisedof nine Directors with three Executive and six NonExecutive Directors which includesfive Independent Directors. The composition of the Board of Directors meets therequirements of provisions of Regulation 17 of the Listing Regulations and Section 149 ofthe Companies Act 2013.

Change in office of Directors and Key Managerial Personnel of theCompany during the year under review and details of Directors seeking Re-appointment at 32ndAnnual General Meeting.

Appointment/Reappointment of Directors

The shareholders at the 31st Annual General Meeting basedon the recommendations of the Nomination and Remuneration Committee and the BoardDirectors of the Company approved the reappointed Mrs. Paru M. Jaykrishna as Chairpersonand Managing Director of the Company and Mr. Gokul M. Jaykrishna as Joint ManagingDirector & CEO of the Company for a period of 5 years commencing with effect fromAugust 1 2021 respectively.

Directors liable to retirement by rotation

In accordance with the provisions of Section 152 (6) of the CompaniesAct 2013 and in terms of the Articles of Association of the Company Mr. Arjun Gokul.Jaykrishna Director of the Company is due to retire by rotation at the ensuing 32ndAnnual General Meeting and being eligible offers himself for reappointment. The Boardrecommends his reappointment.

Appointment of Women Independent Director

The Board of Directors based on the recommendations of the Nominationand Remuneration Committee in terms of Section 161 of the Companies Act 2013 andArticles of Association of the Company Mrs. Shivani Revat Lakhia (DIN:09527745) wasappointed as an Additional Director of the Company with effect from March 24 2022.Further based on the recommendations of the Nomination and Remuneration Committee andapproval of the Members through postal ballot on June 21 2022 in accordance with theprovisions of Section 149 read with Schedule IV to the Act Mrs. Shivani Revat Lakhia(DIN:09527745) was appointed as an Independent Director (Women) of the Company not liableto retire by rotation for a period of five consecutive years commencing from March 242022.

Mrs. Shivani Revat Lakhia is Bcom LLB. She is an Advocate having vastknowledge in various laws and in particular Conveyance Land & Revenue. She is havingmore than 12 years experience in legal matters.

Profile of Directors seeking appointment/re-appointment

As required under Regulation 36 (3) of the Securities Exchange Board ofIndia (Listing Obligation and Disclosure Requirements) Regulation 2015 particulars ofDirectors seeking appointment/ re-appointment at the ensuing Annual General Meeting areannexed to the notice convening 32nd Annual General Meeting.

Key Managerial Personnel

Pursuant to the provisions of sections 2(51) and 203 of the CompaniesAct 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as on March 31 2022 the Key Managerial Personnel (KMP) in the Company are asfollows:

Mrs. Paru M. Jaykrishna Chairperson and Managing Director

Mr. Gokul M. Jaykrishna Joint Managing Director & CEO

Mr. Arjun G. Jaykrishna Executive Director

Mr. Pratik Shah Chief Financial Officer

Mr. Saji Varghese Joseph Company Secretary

During the year under review Mr. Pratik Shah was appointed as CFO andKey Managerial Personnel in the terms of provisions of Section 203 of the Companies Act2013 with effect from August 4 2021 upon the resignation of Mr. Utsav K. Pandwar as CFOand Key Managerial Personnel with effect from close of business hours on April 20 2021.

Women Director

The Composition of the Board of Directors of the Company includes awomen director viz. Mrs. Paru M. Jaykrishna and

Mrs. Shivani Revat Lakhia. Accordingly the Company is in compliancewith the requirement of Section 149 (1) of the Companies Act 2013 read with Rule 3 of theCompanies (Appointment and Qualification of Directors) Rules 2014.

Criteria for Determining Qualifications Positive Attributes andIndependence of a Director

The Nomination and Remuneration Committee has formulated NominationRemuneration and Evaluation Policy which details the criteria for determiningqualifications positive attributes and independence of Directors in terms of provisionsof Section 178(3) of the Companies Act 2013 and the Listing Regulations. The policy formspart of this report. There are no material changes and commitments affecting the financialposition of the Company which have occurred between the end of the Financial Year of theCompany to which the financial statements relate and the date of the Report.

Declaration of independence

The Company has received necessary declarations from the independentdirectors under Section 149(7) of the Companies Act 2013 the he/she meets the criteriaof independence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25of the Securities Exchange Board of India (Listing Obligation and Disclosure Requirements)Regulation 2015. The Board confirms that the said Independent Directors meet the criteriaas laid down under the Companies Act 2013 as well as Securities Exchange Board of India(Listing Obligation and Disclosure Requirements) 2015. There is no pecuniary transactionsentered into with the Independent Director apart from sitting fees.

Certificate from Practicing Company Secretary

Pursuant to Regulation 34(3) and Schedule V Para C clause (10) (i) ofthe Listing Regulations M/s. Shyamsingh Tomar Associates Company Secretary in PracticeAhmedabad has certified that none of the Directors on the Board of the Company has beendebarred or disqualified from being appointed or continuing as Directors of the Company bythe Securities and Exchange Board of India/Ministry of Corporate Affairs or any suchstatutory authority and the certificate forms part of the Report of Corporate Governanceforming part of this Annual Report.

Number of Meetings of the Board of Directors

The Board meets at regular intervals to consider and approve financialresults business policies and strategic proposals apart from other items of business. TheBoard and Committee meetings are pre-scheduled and a tentative annual calendar ofmeetings is circulated to the Directors in advance to ensure participation of allDirectors.

During the year under review six Board meetings were held andmeetings of Subcommittees were also held. The intervening gap between the meetings waswithin the period prescribed under the Act and the Listing Regulations. The details of themeetings are given in the Report on Corporate Governance which forms part of this Report.The Company provides all the Board members the facility to participate the meetings ofBoard and Subcommittees through Video Conferencing / Other Audio-

Visual means. Pursuant to the requirements of Schedule IV to theCompanies Act 2013 and the Listing Regulations a separate Meeting of the IndependentDirectors of the Company was held on February 03 2022 and the Directors reviewed thematters enumerated under Schedule IV(VII)(3) to the Act and Regulation 25(4) of theListing Regulations. All the Independent Directors attended the said meeting.

Statutory Committees of the Board

The Company has the following five (5) Board level Committees whichhave been established in compliance with the requirements of the relevant provisions ofapplicable laws and statutes:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Corporate Social Responsibility Committee

4. Stakeholders' Relationship Committee

5. Risk Management Committee

Audit Committee

The Audit Committee comprises of three Non-Executive Directors all ofwhom are Independent Directors.

Dr. Pradeep Jha is the Chairman of the Audit Committee. The Compositionof the Audit Committee meets the requirement of Section 177 of the Companies Act 2013 andRegulation 18 of the Securities Exchange Board of India (Listing Obligation and DisclosureRequirements) Regulation 2015. The Company Secretary is the Secretary of the Committee.The Joint Managing Director Chief Financial Officer and Auditors are permanent inviteesto the committee meetings.

The detail of terms of reference of Audit Committee number and datesof meetings held attendance of the directors and remunerations paid to them are givenseparately in the attached Corporate Governance Report. Your Company has a well structuredInternal Audit System commensurate with its size and operations. During the year therewere no instances where the board had not accepted the recommendations of the AuditCommittee.

Further details on the Audit Committee are provided in the CorporateGovernance Section of the Annual Report.

Corporate Social Responsibility Committee

In terms of the provisions of Section 135 of the Companies Act 2013read with Companies (Corporate Social Responsibility Policy) Rules 2014 the Board ofDirectors of your Company has constituted a Corporate Social Responsibility ('CSR")Committee which is Chaired by Mrs. Paru M. Jaykrishna the Chairperson and ManagingDirector of the Company the other members of the committee are Mr. Jayprakash M. Pateland Dr. Pradeep Jha who are independent directors of the Company. Your Company also has inplace a CSR policy and the same is available on the website of the Company. The committeeplaces before the Board the details of the activities to be undertaken during the year. Adetail report is attached as Annexure - "G" forming part of this report.

Nomination and Remuneration Committee

The constitution and terms of reference of nomination and remunerationcommittee of the Company are in compliance with Section 178 of the Companies Act 2013 andRegulation 19 and Part D of Schedule II of the Securities Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015

As on March 31 2022 the Nomination and Remuneration Committeecomprises of three (3) Non-Executive Independent Directors Mr. Jayprakasah M. PatelChairman Mr. R. K. Sukhdevsinhji and Dr. Pradeep Jha Member as its members..

Further details relating to the Nomination and Remuneration Committeeare provided in the Corporate Governance Report which forms an integral part of thisAnnual Report.

Stakeholders Relationship Committee

The Stakeholders' Relationship Committee is primarily responsible toreview all matters connected with the Company's transfer of securities and redressal ofshareholders' / investors' complaints. The constitution and terms of reference ofStakeholder Relationship Committee of the Company pursuant to Section 178(5) of theCompanies Act 2013 and Regulation 20 and Part D of Schedule VI of the Securities ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015.

Risk Management Committee

As per Regulation 21 of Securities Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has constituted aRisk Management Committee. Your Company has prepared Risk Management Policy and FormulatedRisk Management Committee and define role and responsibilities as per Securities ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015. Youcan access the same from the Company's website www.asahisongwon.com.

Board Effectiveness

a. Familiarization Programme for the Independent Directors

Your Company has put in place a well structured familaristion programmefor all its directors including independent directors of the Company with respect to theroles and responsibilities outlined under the Companies Act 2013 and other relatedRegulations. The Directors are familiarized with the Company their roles rightsresponsibilities in the Company nature of the industry in which the Company operatesbusiness model of the Company etc. from time to time. The Company makes consistent effortsto acquaint the Board with the overall business performance covering all Businessverticals by way of presenting specific performance of each Plants Product Category andCorporate Function from time to time. Details of the Familiarization Programme areexplained in the Corporate Governance Report.

b. Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and Regulation25(3) & (4) of the Securities Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 the Independent Directors in their meetingheld on February

3 2022 have evaluated the Performance of Non-Independent DirectorsChairperson of the Company after considering the views of the Executive and Non-ExecutiveDirectors Board as a whole assessed the quality quantity and timeliness of flow ofinformation between the Company's Management and the Board. The Nomination andRemuneration Committee has also carried out evaluation of performance of every Director ofthe Company.

The evaluation of individual Director was carried out based on variousparameters such as participation in the Board and its Committee meetings contributiontowards strategic proposals suggesting risk mitigation measures putting in placeinternal controls governance leadership and talent development and managing externalstakeholders. Performance evaluation of various Sub- committees of the Board was carriedout based on the criteria such as constitution effective functioning of the Subcommitteesas per the terms of reference periodical suggestions and recommendations given by theSub-committees to the Board etc

On the basis of evaluation made by the Independent Directors and theNomination and Remuneration Committee and by way of individual and collective feedbackfrom the Non-Independent Directors the Board has carried out the Annual PerformanceEvaluation of the Directors individually as well as evaluation of the working of the Boardas a whole and Committees of the Board. The manner in which the evaluation has beencarried out is explained in the Corporate Governance Report.

The Independent Directors are regularly updated on industry &market trends plant process and operational performance of the Company etc. throughpresentations. They are also periodically kept aware of the latest developments in theCorporate Governance their duties as directors and relevant laws.

In the meeting of Independent Directors held during the year themembers considered evaluation of the performance of the Chairman based on criteria such asgiving guidance to the Board and ensuring the independence of the Board etc. Theperformance of the Non- Independent Directors was also evaluated based on theircontribution made to the growth of the Company strategic initiatives and Boarddeliberations.

Diversity of the Board

The Company recognises and embraces the benefit of having a diverseBoard of Directors and views increasing diversity at the Board level as an essentialelement in maintaining competitive advantage in the Business in which it operates. ThisPolicy can be accessed from the Company's website www.asahisongwon.com

Directors Responsibility Statement

Pursuant to section 134(5) of the Companies Act 2013 the Board ofDirectors to the best of its knowledge and ability confirm that:

i) in the preparation of the annual financial statements for the yearended March 31 2022 the applicable accounting standards have been followed along withproper explanation relating to material departures if any;

ii) the directors had selected such accounting policies and appliedthem consistently and made judgements 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 the profit and loss of the Company for that period;

iii) proper and sufficient care has been taken 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;

iv) the annual financial statements have been prepared on a goingconcern basis;

v) they had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi) they had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

Auditors Related Matters

a. Statutory Auditors

The Statutory Auditors M/s. Mahendra N. Shah & Co. CharteredAccountants (Firm Registration No. 105775W) Ahmedabad were appointed as the StatutoryAuditors of the Company for a term of five years till the conclusion of the 32ndAnnual General Meeting of the Company.

On the recommendation of Audit Committee of the Company the Board ofDirectors at its meeting held on August 04 2022 has recommended for the approval ofshareholders for appointment of M/s. Talati & Talati LLP Chartered AccountantsAhmedabad as Statutory Auditors of the Company for a term of five (5) consecutive yearscommencing from the conclusion of the 32nd Annual General Meeting("AGM") till the conclusion of the 37th Annual General Meeting of theCompany to be held in the calendar year 2027 in place of M/s. Mahendra N. Shah & Co.Chartered Accountants (Firm Registration No. 105775W) Ahmedabad who shall retire at theconclusion of 32nd Annual General Meeting of the Company up completion of theirexisting term of five (5) consecutive years.

M/s. Talati & Talati LLP Chartered Accountants is a C&AGempanelled category - I firm. It is also a peer reviewed firm by the Institute ofChartered Accountants of India. The firm was established in 1976 and is having standing of46 years. Total number of team members of the firm including 20 partners is 450+ acrossIndia. The firm has offices at Ahmedabad Vadodara Anand Surat Mumbai Delhi Noida andKochi. The diversified service portfolio of the firm includes Audit & AssuranceTaxation Advisory Due Diligence Forensic Audit etc.

The Company has received a certificate from the Auditors stating thattheir appointment if made will be within the limit specified under Sections 139 and 141of the Companies Act 2013.

The Auditors have also confirmed that they have subjected themselves tothe peer review process of Institute of Chartered Accountants of India (ICAI) and hold avalid certificate issued by the Peer Review Board of the ICAI.

b. Secretarial Auditors

Pursuant to Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed M/s. Shyamsingh Tomar & Associates Company Secretaries Ahmedabad as aSecretarial Auditor to conduct Secretarial Audit of the Company for the Financial Year2021-2022 (Period from April 1 2021 to March 31 2022).

The Report of Secretarial Auditor in the prescribed form MR-3 for thefinancial year 2021-22 is set out as Annexure-"H" and it forms a part of thisReport.

Certain remarks in the Secretarial Audit Report do not have materialimpact on financial performance of the Company. The views of the Management on such remarkare given hereunder:

During the year under review penalty was levied by National StockExchange of India Limited and BSE Limited for Noncompliance to Regulation 17 (1) (a) and21 of Securities Exchange Board of India (Listing Obligation and Disclosure Requirements)Regulations 2015. In terms of Regulation 17 (1)(a) of SEBI Listing Regulation the Boardof the top 1000 listed entities (on the basis of market cap) shall have atleast oneIndependent Women Director with effect from April 01 2021 and the Company has appointedindependent women director on March 24 2022. The Board of the Company is now dulyconstituted and complied Regulation 17 (1) (a) of Securities Exchange Board of India(Listing Obligation and Disclosure Requirements) Regulations 2015 further the Companyhas already constituted risk management committee vide board meeting held on October 262021. The Company has duly paid penalty levied by BSE Limited and National Stock Exchangeof India Limited as per their Invoice.

Further under regulation 24A of Securities Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 the Company hasreceived Secretarial Compliance Report for the 2021-2022 from M/s. Shyamsingh Tomar &Associates Company Secretaries Ahmedabad and same has filed with the Stock Exchanges(BSE& NSE).

c. Internal Auditors

M/s. Fenil P. Shah & Associates a Practicing CharteredAccountants Ahmedabad are the Internal Auditors of the Company for the financial year2021-22. Internal Auditors are appointed by the Board of Directors of the Company on ayearly basis based on the recommendation of the Audit Committee. The Internal Auditorsreport their findings on the internal audit of the Company to the Audit Committee on aquarterly basis. The scope of internal audit is approved by the Audit Committee.

d. Cost Auditors

During the year under review cost audit was not applicable to theCompany.

e. Audit Report

The report of the Statutory Auditors along with Notes to Schedules isenclosed with this Report. The Auditor's Comments on the Company's Accounts for thefinancial year ended on March 31 2022 are self-explanatory in nature and do not requireany explanation as per provisions of Section 134 of the Companies Act 2013. The Auditor'sReport does not contain any qualification reservation or adverse remark.

Details in Respect of Frauds Reported by Auditors other than thosewhich are Reportable to the Central Government

During the year under review neither the Statutory Auditors nor theSecretarial Auditors have reported to the Audit Committee under section 143(12) of theCompanies Act 2013 any instances of fraud committed against your Company by its officersand employees details of which would need to be mentioned in the Board's Report.

Policy matters

Nomination Remuneration and Evaluation Policy

In terms of provisions of Section 178(3) of the Act the Nomination andRemuneration Committee of the Company has formulated and recommended to the Board apolicy containing the criteria for determining qualifications competencies positiveattributes and independence for appointment of a Director (Executive/Non- Executive) andit highlights the remuneration for the Directors Key Managerial Personnel and otheremployees ensuring that it covers the matters mentioned in Section 178(4) of the Act.Nomination Remuneration and Evaluation Policy approved by the Board forms part of thisReport as per Annexure-"D".

Vigil Mechanism / Whistle Blower Policy

The Company has adopted a Whistle Blower Policy which enables theDirectors and Employees to report instances of unethical behavior fraud or violation ofCompany's Code of Conduct. The policy provides for direct access to the Chairperson of theAudit Committee and safeguarding the employees and Directors who raises grievances againstvictimization. The policy has been circulated amongst the employees of the Company workingat various locations. The policy formulated in line with the provisions of the Act and theListing Regulations is available on the website of the Company www.asahisongwon.com.

Corporate Social Responsibility Policy

In terms of the provisions of Section 135 of the Act read with theCompanies (Corporate Social Responsibility Policy) Rules 2014 the Board of Directors ofyour Company has constituted a Corporate Social Responsibility (CSR) Committee and frameda CSR policy which details the programs / activities that can be carried out under variousprogram heads and the same is available on the website of the Companywww.asahisongwon.com.

The Company's CSR Programmes are focused on Health Care and EducationInfrastructure Development Sustainable Livelihood and Social Empowerment & Welfare.During the year the Company carried out several initiatives under the CSR programme headsa report on CSR activities is attached as Annexure-"G" forming part of thisreport.

Risk Management Policy

The Company has formulated Enterprise Risk Management policy inaccordance with the guidelines provided under the Charter of the Risk Management Committeeof the Board of Directors and pursuant to Regulation 21 of the Securities Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015.

Risk Management policy provides a structured consistent andcontinuous process across the whole organization for identifying assessing deciding onmitigations and reporting on the opportunities and threats that may affect the achievementof its strategic objectives.

The Company has enhanced Enterprise Risk Management Charter and Policyto institutionalize a formal risk management function and framework consisting of RiskManagement Process and Risk Governance and Communication Structure. For detailed frameworkand outcome refer to Enterprise Risk Management section in the Management Discussion andAnalysis Report.

Dividend Policy

Pursuant to the provisions of Regulation 43A of the ListingRegulations the Board of Directors of the Company has adopted a Dividend Policy whichdetails the dividend philosophy of the Company the factors which are considered by theBoard while recommending / declaring dividend suggested band for proposing dividendpayout periodicity of dividend circumstances in which dividend is considered etc. Thesaid policy is given in Annexure-"F" to this report and posted on the website ofthe Company www.asahisongwon.com.

Cash Flow Statement

As required under Regulation 34(2) (c) of the Securities Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 a Cash FlowStatement prepared in accordance with the Indian Accounting Standard 7 (IND AS-7) isattached to the Financial Statement.

Annual Return

The details forming part of the Annual Return of the Company containingthe particulars prescribed under Section 92 and 132 of the Companies Act 2013 read withRule 12 of the Companies (Management and Administration) Rules 2014 in Form MGT- 7 ason March 31 2021 is made available on the Company's website www.asahisongwon.com.

Also the draft of Form MGT-7 as on March 31 2022 is made availableon the Company's website www.asahisongwon.com.

Export House Status

The Company has been awarded status of "Two Star ExportHouse" by Office of Development Commissioner Kandla Special Economic ZoneGandhidham Kutch in accordance with provisions of Foreign Trade Policy 2015-2020. Thisstatus is valid till December 31 2025.

Awards and Accolades

During the year under review the Company has received First Award forSelf Manufactures Direct Export of Dye Intermediates for the year 2020-2021 third forSelf Manufactured Domestic Sale of Dye Intermediates for the year 2020-2021 and a SpecialTrophy for Self Manufactured Domestic Sale of Dye Intermediate of Rs 60 Crores and abovefor the year 2019-2020 from The Gujarat Dyestuff Manufacturers Association (GDMA).

Research and Development (R&D)

The Company has a Research and Development centre which is recognizedby the Ministry of Science and Technology Government of India. Focused areas of theResearch and Development Centre was on product quality cost reduction new productofferings and environmental sustainability.

Any Revision Made in Financial Statements or Board's Report

The Company has not revised the Financial Statements or Board's Reportin respect of any of the three preceding Financial Years.

Particulars of Loans Guarantees or Investments Under Section 186 ofthe Companies ACT 2013

The particulars of loans guarantees and investments have beendisclosed in the financial statements.

Particulars of Contracts or Arrangements With Related Parties

All related party transactions which were entered during the FinancialYear were in the ordinary course of business and on an arm's length basis. There were nomaterially significant related party transactions entered by the Company with thePromoters Directors Key Managerial Personnel or other persons which may have a potentialconflict with the interests of the Company.

A statement of all related party transactions is presented before theAudit Committee on quarterly basis specifying the nature value and terms and conditionsof transactions. A seperate report is provided in Form AOC-2 as per Annexure -"B" as prescribed under Section 134(3) (h) of the Act and Rule 8(2) of theCompanies (Accounts) Rules 2014. In accordance with the requirements of the ListingRegulations the Company has also adopted Policy on Materiality and dealing with RelatedParty Transactions and the same has been placed on the website of the Company atwww.asahisongwon.com.

Management Discussion and Analysis Report

In compliance with Regulation 34(2)(e) of the Securities Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 theManagement Discussion and Analysis Report forms part of this Annual Report.

Corporate Governance

The report of the Board of Directors of your Company on CorporateGovernance in terms of Regulation 34 read with Schedule V of Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 is presented asa separate section titled Corporate Governance Report as per Annexure-"I".

The composition of the Board the Audit Committee the Nomination andRemuneration Committee the Stakeholders Relationship Committee the Corporate SocialResponsibility Committee and other Committees of the Board the number of meetings of theBoard and Committees of the Board and other matters are presented in the CorporateGovernance Report.

A certificate from M/s. Shyamsingh Tomar & Associates CompanySecretaries Ahmedabad regarding compliance with the Corporate Governance requirements asstipulated in the Securities Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 which forms part of the Annual Report.

Further as required under Regulation 17(8) of the Listing Regulationsa certificate from the Joint Managing Director & CEO and Chief Financial Officer isannexed with this Report.

Code of Conduct

In compliance with Regulation 26(3) of the Listing Regulations and theAct the Company has framed and adopted Code of Conduct (the Code) for Directors andSenior Management which provides guidance on ethical conduct of business and complianceof law All members of the Board and Senior Management personnel have affirmed thecompliance with the Code as on March 31 2022. A declaration to this effect signed by theManaging Director in terms of the Listing Regulations is given in the Report of CorporateGovernance forming part of this Annual Report. The Code is made available on the Company'swebsite www.asahisongwoncom

Particulars Of Conservation of Energy Technology Absorption andForeign Exchange Earnings 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 is given as per Annexure - "C" hereto forming part of this Report.

Details in Respect of Adequacy of Internal Financial Controls WithReference to the Financial Statements

Your company has in place adequate internal control systemscommensurate with the size of its operations. The internal control systems comprises ofpolicies and procedures which

are designed for safeguarding the assets optimal utilization ofresources sound management of company's operations. These are continually reviewed by theCompany to strengthen the same wherever required. The internal control systems aresupplemented by internal audit carried out by an Independent Cost Accountant andperiodical review by management. The Audit Committee of the Board addresses issues ifany raised by both the Internal Auditors and the Statutory Auditors.

Details in respect of adequacy of internal financial controls withreference to the financial statements are stated in Management Discussion and Analysiswhich forms part of this Report.

Risk Management

The Company has well defined process to identify assess monitor andmitigate various business risks. The Company recognizes that these risks need to bemanaged to protect interest of the stakeholders to achieve business objective and enablesustainable growth. Many risks identified by the business and functions are systematicallyaddressed through mitigating actions on a continuing basis. Further details are set out inthe Management Discussion and Analysis Report forming part of this Report.

Industrial Relations

The Company maintained healthy cordial and harmonious industrialrelations at all levels. The enthusiasm and unstinting efforts of employees have enabledthe Company to remain at the leadership position in the industry. It has taken varioussteps to improve productivity across organization.

Particulaurs of Employees and Related Disclousres

The information required pursuant to Section 197 of Companies Act 2013read with Rule 5 of the Companies (Appointment & Remuneration of Managerial Personnel)Rules 2014 in respect of employees of the Company is given as per Annexure-"E"hereto forming part of this Report.

In accordance with the provisions of section 197(12) of the CompaniesAct 2013 read with rules 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 the names and other particulars of employees drawingremuneration in excess of the limits set out in the aforesaid rules forms part of thisReport. In line with the provisions of section 136(1) of the Companies Act 2013 theAnnual Report as set out therein are being sent to all the Members of your Companyexcluding the aforesaid information about the employees. Any Member who is interested inobtaining these particulars about employees may write to the Company Secretary of theCompany.

Certifications

Your Company has ISO 14001:2015 for Environmental Management Systemcertification and ISO 9001-2015 for quality management system for plant at Vadodara.

Disclosure Under the Sexual Harassment of Women at Work Place(Prevention Prhibition & Redressal) ACT 2013

The Company has in place a policy on prevention of sexual harassment atworkplace. The policy aims at prevention of harassment of employees and lays down theguidelines for identification reporting and prevention of sexual harassment. All womenemployees (permanent temporary contractual and trainees) are covered under this policyand it has been circulated amongst the employees of the Company and the same is exhibitedon the notice board of all the business locations of the Company.

During the year under review the Company had not received anycompliant under Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013.

Compliance with Secretarial Standards

The Board of Directors affirms that the Company has complied with theapplicable Secretarial Standards issued by the Institute of Companies Secretaries of India(SS1 and SS2) respectively relating to Meetings of the Board and its Committees which havemandatory application during the year under review.

Code of Practices and Procedures for Fair Disclosure of UnpublishedPrice Sensitive Information

The Board has formulated Code of Practices and Procedures for FairDisclosure of Unpublished Price Sensitive Information (Fair Disclosure Code) for fairdisclosure of events and occurrences that could impact price discovery in the market forthe Company's securities and to maintain the uniformity transparency and fairness indealings with all stakeholders and ensure adherence to applicable laws and regulations.The copy of the same is available on the website of the Company www.asahisongwon.com.

Prevention of Insider Trading

The Board has formulated code of conduct for regulating monitoring andreporting of trading of shares by Insiders. This code lays down guidelines procedures tobe followed and disclosures to be made by the insiders while dealing with shares of theCompany and cautioning them on consequences of noncompliances. The copy of the same isavailable on the website of the Company www.asahisongwon.cojm.

Details of Application Made or any Proceeding Pending Under theInsolvency and Bankruptcy Code 2016

During the year under review the Company has neither made anyapplication nor any proceeding pending under the Insolvency and Bankruptcy Code 2016.

Environment Health and Safety

The Company is committed to health and safety of its employeescontractors and visitors. We are compliant with all EHS Regulations stipulated under theWater (Prevention and Control of Pollution) Act The Air (Prevention and Control ofPollution) Act The Environment Protection Act The Factories Act and Rules made thereunder. Safety and environmental standards are periodically reviewed and upgraded. TheCompany preserves in its efforts to educate safe and environmentally accountable behaviorin every employee as well as its vendors.

The Company has undertaken various environment friendly measures in itsdifferent Units for promoting a better environment. The Company has in place adequatepollution control equipment.

The solid waste generated at the Works after treatment of its liquideffluent is shifted to a Gujarat Pollution Control Board (GPCB) approved site.

The Company has maintained a greenbelt around its sites as a part ofits commitment to environment management.

The Company continues to demonstrate its commitment to a clean and safeenvironment. The state of the art effluent treatment plant continues to runsatisfactorily so that the treated wastewater discharged is well within the stipulatednorms set by GPCB. As a part of water conservation efforts the Company has implementedsuitable engineering solution to utilize recycled water as much as possible in cleaninggardening and other utilities.

Appreciation and Acknowledgements

Your Directors would like to express their appreciation for theassistance and cooperation received from the Government of India Government of GujaratElectricity supply companies and Bankers and look forward to their continued support infuture. We place on record our appreciation all our employees for their contribution toyour Company's performance. We applaud them for their superior levels of competencededication and commitment to your Company.

The Company is thankful to the shareholders for reposing trust in theCompany and their unflinching enthusiasm and patronage.

Place : Ahmedabad Paru M. Jaykrishna
Date : August 04 2022 Chairperson & Mg. Director
DIN: 00671721
Registered Office:
"Asahi House"
13 Aaryans Corporate Park
Nr. Shilaj Railway Crossing
Thaltej - Shilaj Road
Thaltej Ahmedabad - 380 059 (India)
CIN:L24222GJ1990PLC014789

.