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AVG Logistics Ltd.

BSE: 535067 Sector: Others
NSE: AVG ISIN Code: INE680Z01018
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AVG Logistics Ltd. (AVG) - Director Report

Company director report

The Members AVG Logistics Limited

Dear Members

The Directors of your Company are pleased to present the 12th Annual Report on thebusiness and operations of the Company ("The Company" or "AVG")together with the audited Financial Statement for the financial Year ended March 31st2021.

1. FINANCIAL SUMMARY AND HIGHLIGHTS

Key highlights of the financial results of the Company prepared as per the AccountingStandards prescribed in the Companies (Accounting Standards) Rules 2006 for the financialyear ended 31st March 2021 are as under. Wherever applicable the consolidated financialstatement is also being presented in addition to the standalone financial statement of theCompany.

Particulars

Standalone

Consolidated

31st March 2021 31st March 2020 31st March 2021 31st March 2020
Income
Revenue from operations 33339.24 32228.24 33339.24 32228.24
Other Income 118.81 146.02 118.81 146.02
33458.05 32374.26 33458.05 32374.26
Expenses
Operating Expenses (Including the amount of Consumptions) 26635.9 25287.81 26635.9 25287.81
Employee Benefit Expense 1234.13 1408.93 1234.13 1408.93
Finance Costs 1220.99 968.09 1220.99 968.09
Depreciation and Amortization Expense 678.44 930.72 678.44 930.72
Other Expenses 4025.49 3119.62 4025.49 3119.62
33794.96 31715.17 33794.96 31715.17
Profit before exceptional and extraordinary items and tax (336.91) 659.09 (336.91) 659.09
Prior period expense (100.89) 23.12 (100.89) 23.12
Profit before tax (236.02) 635.97 (236.02) 6354.97
Tax expense:
(1) Current tax 289.83 289.83
(2) Adjustment for earlier years (45.77) 8.44 (45.77) 8.44
(3) Deferred Tax (13.91) (110.27) (13.91) (110.27)
Profit for the year (176.34) 447.97 (176.34) 447.97
Share of profit/ (loss) from associate 4.46 70.97
Share of profit from enterprise (0.18) (0.40)
(176.34) 447.97 (172.06) 518.54
Earning per equity share (nominal value of Share Rs. 10 (P.Y. Rs 10)
(1) Basic (1.58) 4.35 (1.54) 5.04
(2) Diluted (1.58) 4.35 (1.54) 5.04

OPERATIONAL AND FINANCIAL PERFORMANCE REVIEW

Your Directors are pleased to inform you that your Company with reliable and resilientbusiness model has evolved from dealing single business division to integrated logisticsplatform your company has introduced the two (2) New business divisions first is theCold Chain business division company has segregated the reefer Division from the FleetOperations and second is Costal Container business division with the agile developmentand implementation approach your Company is able to provide high levels of service andreliability and gain full visibility into product movements.

Your Company is constantly strengthening its capabilities and relationships withcustomers and wider stakeholder fraternity with a focus on long term value creation. Ithas Won Business from Indian Railways to Operate Goods train from Delhi to Bangalore andback twice a week and also entered new business agreement with giant clients like JubilantFood works limited Noida C P Milk & Food Products Pvt. Limited Lucknow Parag MilkFoods Pvt. Limited Pune for deploying reefer vehicles. Your Company has largecustomers/clients comprising of both corporate and SMEs belonging to different industriesprovide us a discernible competitive advantage and accelerated growth opportunities.

Your Company always believes and focus to provide timely and satisfactory service toits clients and stakeholders resulting thereby expanding successfully its business acrossthe geographies.

Your Board of Directors are also delighted to inform you that with a view to givemeaning to its expansion plan the Company has been making constant efforts for developingrequisite infrastructure as well as utilizing advance means of technology for exercisingbetter and effective control on its operation as well as movements of its fleet. YourCompany's Logistics revenue has increased to Rs. 31577.56 lakhs in 2020-21 from Rs.27200.34 Lakhs in 2019-20 and the Profit before tax for the year decrease to Rs. (236.02)Lakhs during the year as compare to Rs. 635.97 lakhs in financial year 2019-20.

In Continuation your Directors wish to inform that COVID-19 pandemic is one of themost rapidly spreading pandemics the human race witnessed in the recent times and it hasaffected the global business of shipping freight maritime logistics supply chain andtrade. The Covid-19 pandemic and the subsequent lockdowns across economies also showcasedthe importance of the Logistics Industry. The Global Logistics Industry played a key rolein helping reach the necessary goods and medical items to the farthest corner of the earthduring these difficult times. Accordingly your Directors assures that your Company willcome out of the Pandemic Scenario of COVID-19 with its Operational Strategy as yourCompany spans across a wide range of service offerings such as by air road rail and seatransport as well as related services such as warehousing handling and stevedoring. YourDirectors are confident and expecting considerable growth in revenue as well asprofitability by the end of March 2022.

1. COVID-19

The COVID-19 pandemic developed rapidly in the Financial Year 2020-21. The year underreview had been affected by the pandemic COVID-19 which had raised new challenges to caterto logistic needs of our customers. Shortage of market vehicles Safety of Drivers andIncrease in Diesel prices posed other threats during these times. The nation wide lockdownfrom March2020 disrupted the logistic operations and majorly affected the operations inthe first quarter of the year under review. AVG however picked up the pace in operationsin the New normal in the following period enabling it to achieve a growth of 12% in thefreight income on year to year basis. During the gradual lockdown period we followed allthe guidelines issued in this regard by the respective States and the Central Governmentand remained operational and after some initial hiccups road transportation startedoperating as normal.

While during the lockdown period the logistics services were crucial for thedistribution of many essential items warehousing demand shot up for products wheremanufacturers were unable to take delivery of raw materials in the pipeline. Your Companyfunctioned with energy and readiness to the challenges of Covid-19 balancing the peaksand drops in demand while protecting its staff and customers.

During this period of economic and financial uncertainties we appreciate the continuedsupport and faith reposed in us by the banks and financial Institutions. We commitourselves to reciprocate their support and faith by discharging our obligations towardsthem in a timely manner.

2. TRANSFER TO RESERVES

The Board of your Company has decided not to transfer any amount to the GeneralReserves for the financial year 2020-21.

As per Standalone financials the net movement in the reserves of the Company as at 31March 2021 (FY 2020-2021) [Previous Year ended 31 March 2020 (FY 2019-2020)] is asfollows:

Amount in INR Lakhs

Particulars Financial Year 2020-21 Financial Year 2019-20
Securities Premium 3161.79 2659.52
Surplus in Statement of Profit and Loss 3508.42 3684.76
Total Reserves & Surplus 6670.21 6344.28

The Members are advised to refer the Note No. 03 as given in the financial statementswhich forms the part of the Annual Report for detailed information.

3. DIVIDEND

The Board of Directors of your company after considering the cash requirement forbusiness growth and debt servicing has decided that it would be prudent not to recommendany Dividend for the year under review.

4. STATE OF THE COMPANY S AFFAIRS

a. Segment-wise position of business and its operations

The Company's business activity falls in primarily into one segment only i.e. Logisticbusiness. The Company operates mainly in Transportation warehousing business and othervalue added services. Hence it has only one reportable segment and separate disclosuresare not required.

b. Change in status of the company

During the Year under review there was no Change in the Status of the Company.

c. Change in the financial year

During the Financial Year 2020-2021 under review the Company has followed uniformfinancial year from 1st April of every year to 31st March.

d. Capital expenditure

During the Year under review your Company entailed a capital expenditure of INR3151.74 Lakhs in Tangible assets.

e. Details and status of acquisition merger expansion modernization anddiversification

During the Year under review no such transaction occurred.

5. CHANGE IN THE NATURE OF BUSINESS

The Company continued to carry Business of Transportation Warehousing and other valueadded services there was no change in the nature of business or operations of the Companywhich impacted the financial position of the Company during the year under review.However the company has introduced the two (2) New business divisions first is the ColdChain business division company has segregated the reefer Division from the FleetOperations and second is Costal Container business division.

6. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There were no material changes and commitments which affect the financial position ofthe Company.

7. DETAILS OF REVISION OF FINANCIAL STATEMENT OR THE BOARD'S REPORT

During the Financial Year 2020-2021 under review the Company has not revised itsfinancial statement or the Board's Report in respect of any of the three precedingfinancial years either voluntarily or pursuant to the order of any judicial authority.

8. CAPITAL AND DEBT STRUCTURE

A. Changes in Share Capital Structure

During the Financial Year under review there is no change in the Authorized ShareCapital of the Company. As on March 31 2021 the Authorized Share Capital of the Companyis INR 1200.00 Lakhs divided into 120 Lakhs equity shares of INR 10 each. However duringthe Year under review the Company vide its Board Resolution dated 16th June2020 and through the Approval of the Members in their Extra-Ordinary General Meeting heldon 15th July 2020 has approved the Issuance of 14 77271 Equity Shares of theCompany by way of Preferential Basis to Specified Non-Promoter entities.

The Issued Subscribed and Paid-up Share Capital of the Company has increased toINR117752710.

The equity shares of the Company are listed on emerged platform of National StockExchange of India (NSE)

The Members are advised to refer the Note No. 02 for Equity Shares and Note No. 03 forSecurity Premium in the financial statements which form the part of the Annual Report fordetailed information.

i) Disclosure under Section 43(a)(ii) of The Companies Act 2013:

The Company has not issued any shares with differential rights and hence no informationas per provisions of Section 43(a) (ii) of the Act read with Rule 4(4) of the Companies(Share Capital and Debenture) Rules 2014 is included in the report.

ii) Disclosure under Section 54(1)(d) of The Companies Act 2013:

The Company has not issued any Sweat Equity Shares during the year under review andhence the provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies(Share Capital and Debenture) Rules 2014 are not applicable.

iii) Disclosure under Section 62(1)(b) of The Companies Act 2013:

The Company does not have any Employees Stock Option Scheme and hence the provisions ofSection 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital andDebenture) Rules 2014 are not applicable.

iv) Disclosure under Section 67(13) of The Companies Act 2013:

During the year under review there were no instances of non-exercising of votingrights in respect of shares purchased directly by employees under a scheme pursuant toSection 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures)Rules2014

v) ISSUED SUBSCRIBED AND PAID UP SHARE CAPITAL:

Issued Subscribed and Paid-up Share Capital of the Company is INR 117752710duringthe financial year under review.

The issued subscribed and paid-up Capital of the Company stood at INR 117752710(Rupees Eleven Crore Seventy Seven Lakh Fifty Two Thousand Seven Hundred Ten only) dividedinto 11775271 Equity Shares of face value of Rs.10 each as on 31st March 2021.

B. Changes in Debt Structure

Debentures/Bonds/Warrants or Any Non-Convertible Securities

During the Year under review the Company has not issued any debentures bondswarrants or any non-convertible securities. As on date the Company does not have anyoutstanding debentures bonds warrants or any non-convertible securities.

9. CREDIT RATING OF SECURITIES

During the Financial Year 2020-2021 under review the Company has not taken or issuedany bonds or any debt instruments and neither has obtained any credit rating for them fromany credit rating agencies.

10. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the Year under review there was no amount liable or due to be transferred toInvestor Education and Protection Fund during the financial year 2020-2021 ended 31stMarch 2021.

11. MANAGEMENT

I. Directors and Key Managerial Personnel

The Company has a professional Board with an optimum combination of executive andnonexecutive Directors who bring to the table the right mix of knowledge skills andexpertise. The Board provides strategic guidance and direction to the Company in achievingits business objectives and protecting the interest of stakeholders.

The following are the Directors and key managerial personnel:

1. Mr. Sanjay Gupta (DIN: 00527801) was appointed as Managing Director cum ChiefExecutive Officer (CEO) of the company at the Board Meeting held on 26.12.2017 and consentof the members has been taken at the Extraordinary Meeting held on 19.01.2018.

2. Mrs. Asha Gupta (DIN: 02864795) was appointed as Whole-Time Director of the companyat the Board Meeting held on 26.12.2017 and consent of the members has been taken at theExtraordinary Meeting held on 19.01.2018.

3. Mr. Pawan Kant (DIN: 08594895) was appointed as Additional Independent Directorthrough Resolution by Circulation under section 175 of the Companies Act 2013 on 05thNovember 2019. and consent of the members has been taken at the Annual General Meetingheld on 30.09.2020 for appointing him as Director of the company.

4. Mr. Shyam Sundar Soni was appointed as Non Executive Director of the Company at EGMheld on 31.01.2018 who shall be liable to retire by rotation

5. Mr. Susheel Kumar Tyagi (DIN:06906354) was appointed as Additional IndependentDirector of the Company in the Board Meeting held on 13.11.2018 and consent of the membershas been taken at the Annual General Meeting held on 28.09.2019.

6. Mr. Gurpreet Singh Luthra (Chartered Accountant) was appointed as Chief FinancialOfficer (CFO) at the Board Meeting held on 13.11.2019.

7. Ms Laveena Jain bearing Membership No 52094 was appointed as Company Secretary& Compliance Officer of the company at the Board meeting held on 15.02.2020 w.e.f 30thMarch 2020. She has subsequently resigned on 12.10.2021.

8. Mr. Nagendra Kumar Sharma was appointed as Chief Operating Officer (COO) at theBoard Meeting held on 14.06.2021.

None of the Directors of the Company are disqualified under Section 164 of the Act.

II. Change in Directorship

As per section 152(6)(a) Mr. Sanjay Gupta Managing Directoris liable to retire byrotation at the ensuing Annual General Meeting and being eligible seeks re-appointment.The Board recommends his appointment for the approval of the members of the Company in theensuing Annual General Meeting.

During the Financial Year 2020-21 there were no changes in the key managerialpersonnel of the Company except Mr. Nagendra Kumar Sharma has been appointed as COO (ChiefOperating Officer) by the Board of Directors on 14.06.2021 on the recommendation ofnomination and remuneration committee. However Ms Laveena Jain Company Secretary &Compliance Officer of the company has resigned on 12.10.2021.

III. Declaration by Independent Directors and statement on compliance of code ofconduct

During the Year under review all Independent Directors have given declarations thatthey meet the criteria of independence as laid down under Section 149(6) of the Act andRegulation 16(1)(b) of the SEBI Listing Regulations. The Independent Directors have alsogiven declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment andQualification of Directors) Rules 2014 with respect to their name appearing in the databank of Independent Directors maintained by the Indian Institute of Corporate Affairs. Inthe opinion of the Board of Directors all the Independent Directors including those whohave been appointed/ re-appointed if any during the Financial Year 2020-21 haverelevant integrity skills expertise experience and proficiency.

IV. Board Meetings

During the Financial Year 2020-2021 the Board met 6 times during the financial year2020- 21i.e. 16th June 2020 12th August 2020 29thAugust 20204thSeptember 2020 12th October 2020 13thJanuary2020. The intervening gap between Board Meetings was within the period prescribedunder the provisions of Section 173 of the Act and SEBI Listing Regulations.

V. Committee Meetings Audit Committee

The Company constituted the Audit Committee pursuant to the provision of Section 177 ofthe Companies Act 2013 at the Board Meeting held on 06.02.2018 and further the Committeewas re-constituted on 13.11.2019 5 meetings of the Audit Committee have been conductedduring the Financial Year 20-21i.e. 16th June 2020 12th August2020 4thSeptember 2020 12th October 2020 13th January2020.

The following persons are members of the Audit Committee:

1. Mr. Pawan Kant (DIN: 08594895) Independent Director (Chairman of committee);

2. Mr. Susheel Kumar Tyagi; (DIN: 06906354) Independent Director (Member of committee)and

3. Mr. Sanjay Gupta (DIN: 00527801): Managing Directors (Member of committee)

All the members of the Audit Company are financially literate.

Stakeholders Relationship Committee

The Company constituted the Stakeholders Relationship Committee pursuant to theprovision of Section 178 of the Companies Act 2013 at the Board Meeting held on

06.02.2018 further the Committed was re-constituted on 13.11.20191 Meetings of theStake holder relationship committee has been conducted during the Financial Year20-21i.e. 13thJanuary 2021.

The following persons are members of the Stakeholders Relationship committee:

1. Mr. Pawan Kant (DIN: 08594895) Independent Director (Chairman of committee);

2. Mr. Susheel Kumar Tyagi; (DIN: 06906354 ) Independent Director (Member of committee)and

3. Mr. Sanjay Gupta (DIN: 00527801) Managing Directors (Member of committee) Nominationand Remuneration Committee

The Company constituted a Nomination & Remuneration Committee pursuant to theprovision of Section 178 of the Companies Act 2013 at the Board Meeting held on

06.02.2018 and further the Committed was re-constituted on 13.11.2019 2 meetings ofthe Nomination & Remuneration committee have been conducted during the financial year20- 21i.e. 04th September 2020 19th February 2021.

The following persons are members of the Nomination and Remuneration committee:

1. Mr. Pawan Kant (DIN: 08594895) Independent Director (Chairman of committee);

2. Mr. Susheel Kumar Tyagi; (DIN: 06906354) Independent Director (Member of committee)and

3. Mr. Shyam Sunder Soni (DIN: 00396429) Non-Executive Director (Member of committee)

Corporate Social Responsibility (CSR) Committee

Company's CSR Policy is established by the Board of Directors with the recommendationof the CSR Committee.1 Meetings of the Corporate Social Responsibility committee has beenconducted during the Financial Year 20-21i.e. 13thJanuary 2021.

The Board has duly constituted a CSR Committee and further the Committee wasreconstituted on 13.11.2019 and its composition is as under-

1. Mr. Pawan Kant (DIN: 08594895) Independent Director (Chairman of committee);

2. Mrs. Asha Gupta (DIN: 02864795) Whole Time Director (Member of committee)

3. Mr. Sanjay Gupta (DIN: 00527801) Managing Director (Member of committee)

Operational Committee

The Company constituted an Operational Committee pursuant to the provision of theCompanies Act 2013 at the Board Meeting held on 02.09.2019.7 Meetings of the OperationalCommittee has been conducted during the financial year 20-21i.e. 06.05.2020 15.07.202025.08.2020 13.10.2020 13.11.2020 22.12.2020 19.02.2021.

The Board has duly constituted an Operational Committee and its composition is asunder-

1. Mr. Sanjay Gupta (DIN: 00527801) Managing Director (Chairman of committee);

2. Mrs. Asha Gupta (DIN: 02864795) Whole Time Director (Member of committee)

3. Mr. Susheel Kumar Tyagi; (DIN: 06906354) Independent Director (Member of committee)

VI. Company's Policy on Directors Appointment and Remuneration

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration as laid down in Section 178 of the Companies Act 2013.The Company has inplace a policy on Nomination& Remuneration of Directors Key Managerial and SeniorManagement Personnel which is framed with the object of attracting retaining andmotivating talent which is required to run the Company successfully. It primarily laysdown a framework in relation to remuneration of the Directors Key Managerial Personnel(KMP) Senior Management Personnel as well as provide guidance to the Board of Directors(Board) and Nomination & Remuneration Committee (NRC) in relation to appointment/removal to the said positions which has been approved by the Board of Directors.

VII. Board Evaluation

Pursuant to the provisions of the Act and SEBI Listing Regulations the Board ofDirectors has carried out the annual performance evaluation of its own performanceCommittees of the Board and Individual Directors. The performance of the Board wasevaluated by the Board itselfafter seeking the inputs from all the directors on the basisof the criteria such as structure and composition of Board Culture effectiveness of Boardprocesses functioning execution and performance of specific duties obligations andgovernance etc.

The performance of Committees was evaluated by the Board after seeking inputs fromrespective committee members on the basis of the criteria such as composition ofcommittees effectiveness of committee meetings and quality of recommendation to theBoard etc. The Board reviewed the performance of the individual directors on the basis ofthe criteria such as the contribution of the individual director to the Board andCommittee meetings like preparedness on the issues to be discussed meaningful andconstructive contribution and inputs in meetings etc. In addition the Chairman was alsoevaluated on the key aspects of his role. In a separate meeting of Independent Directorsperformance of NonIndependent Directors performance of the Board as a whole andperformance of the Chairman was evaluated taking into account the views of executivedirectors and nonexecutive directors. The performance evaluation of the IndependentDirectors was carried out by the entire Board. All the Directors expressed theirsatisfaction with the evaluation process.

VIII. Remuneration of Directors and Employees of Listed Companies

The information required pursuant to Section 197 read with Rule 5 (2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees is given below:

A. The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year

S. No Name Designation Ratio
1. Sanjay Gupta Managing Director 23.16:1
2. Asha Gupta Whole Time Director 19.31

B. Persons employed throughout the Financial Year ended 31 March 2021 who were inreceipt of remuneration for the year in which the aggregate was not less than Rs. 1 Crores2 lakhs

S. No Name Designation Remuneration (INR) Qualification Experience Date of Appointment
N.A.

C. Top Ten Employees (in terms of Remuneration): Details are attached as Annexure-A

Further the total strength of the employees as on 31st March 2021 was 408.

IX. Directors Responsibility Statement

Pursuant to clause (c) of sub-section (3) of Section 134 of the Companies Act 2013the Board of Directors to the best of their knowledge and ability confirm that:

a) In the preparation of the Annual Financial Statements for the year ended March 312021 the applicable accounting standards had been followed along with proper explanationrelating to material departures if any;

b) The Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a

true and fair view of the state of affairs of the Company as at March 31 2021 and ofthe Profit and Loss of the company for that period ended on that date;

c) The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d) The Directors had prepared the annual accounts on a going concern basis;

e) The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively;and

f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

X. Internal Financial Controls

Your Company has put in place adequate internal financial controls with reference tothe financial statements some of which are outlined below: Your Company has adoptedaccounting policies which are in line with the Accounting Standards prescribed in theCompanies (Accounting Standards) Rules 2006 that continue to apply under Section 133 andother applicable provisions if any of the Companies Act 2013 read with Rule 7 of theCompanies (Accounts) Rules 2014.

A system of strict internal control including suitable monitoring procedures hasalways believed that transparency systems and controls are important factors in thesuccess and growth of any organization. The Company has an adequate system of internalcontrol supported by an extensive programme of internal control; and systems areestablished to ensure that financial and other records are reliable for preparingFinancial Statements. The internal controls existing in the Company are considered to beadequate vis-a-vis the business requirements. Your Company ensures adequacy with itscurrent size and business to ensure operational efficiency protection and conservationof resources accuracy and promptness in financial reporting and compliance of laws andregulations. It is supported by the internal audit process and will be enlarged to beadequate with the growth in the business activity.

XI. Reporting of Frauds by Auditors

During the year under review neither the Statutory nor the Secretarial Auditors hasreported to the Audit Committee under Section 143 (12) of the Companies Act 2013 anyinstances of fraud committed against the Company by its officers or employees the detailsof which would need to be mentioned in the Board's Report.

12. DISCLOSURES RELATING TO SUBSIDIARIES ASSOCIATES AND JOINT VENTURES

Report on performance and financial position of the subsidiaries associates and jointventures

A Joint Venture Company was incorporated in the Year 2018 with the name NDRAVG BusinessPark Private Limited (CIN: U45309TN2018PTC125055) with the object to develop property atSarita Vihar at New Delhi with provision for warehousing facility and allied facilities

such as cold storage and to establish warehouses bins godowns and cold storages andto provide facilities for storage of commodities articles and things of all kinds anddescription. Our company AVG Logistics Limited is having equity stake of 35% in NDRAVGBusiness Park Private Limited

A report on the performance and financial position of Associate including capitalreserves total assets total liabilities details of investment turnover etc. pursuantto Section 129 of the Companies Act 2013 in the Form AOC-1 as an Annexure - B whichforms part and parcel of the Board s Report.

Companies which have become or ceased to be subsidiaries associates and joint ventures

During the Financial Year 2020-2021 under review none of the Companies have become orceased to be subsidiaries associates and joint ventures.

13. DETAILS OF DEPOSITS

During the Financial Year 2020-2021 under review the Company has neither invited noraccepted any public deposits within the meaning of Section 73 and 74 of the Companies act2013 read with Companies (Acceptance of Deposit) Rules 2014. As such no specific detailsprescribed in Rule 8(1) of the Companies (Accounts) Rules 2014 (As amended) are requiredto be given or provided.

14. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

The Company has duly complied with the provision of Section 186 of the Companies Act2013 during the year under review. The details of loans guarantees and investments aredisclosed in the Financial Statements.

15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO INSUB-SECTION (1) OF SECTION 188 IN THE PRESCRIBED FORM AOC-2;

As per the Requirements of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 your Company has formulated a Policy onRelated Party Transactions which is also available on Company's website atwww.avglogistics.com at a link

http://www.avglogistics.com/upload/document/document 2125338623.pdf.The Policy

intends to ensure that proper reporting; approval and disclosure processes are in placefor all transactions between the Company and Related Parties. There have been nomaterially significant related party transactions between the Company and the Directorsthe management the subsidiaries or the relatives except for those disclosed in thefinancial statements. Accordingly particulars of contracts or arrangements with relatedparties referred to in Section 188(1) along with the justification for entering into suchcontract or arrangement is disclosed in the financials. All Related Party Transactionsentered during the year were in Ordinary Course of the Business and on Arms Length basis.Accordingly the disclosure of

Related Party Transactions as required under Section 134(3) (h) of the Companies Act2013 is disclosed in Form AOC-2 in Annexure-C is annexed to this report.

16. DETAILS OF CSR POLICY AND INITIATIVETAKEN DURING THE FINANCIALYEAR 202021

Company's CSR Policy is established by the Board of Directors with the recommendationof the CSR Committee. Corporate social responsibility (CSR) for AVG goes beyond charityand volunteering. CSR is an integral part of our Company culture rooted in our values asan organization. AVG is committed to make efforts for the nation's social economic andenvironmental good. Objective of the CSR Policy is to make CSR a key business process forthe sustainable development of whole communities while conducting insightful engagementwith our stakeholders. We aim to actively contribute to the holistic development ofunderprivileged children specifically. The CSR policy lays down the principles/process onidentification selection implementation of CSR activities &programmes keeping inmind the Company's CSR vision. It also provides the framework to monitor & evaluatethe CSR activities & programmes in accordance with the provisions of the Act. Furtherbrief outline on the initiatives undertaken by the Company on CSR activities during thefinancial year 202021 is enclosed herewith as Annexure- D. Other details regardingCompany's CSR Policy is available on the website of the Company

athttp://www.avglogistics.com/upload/document/document 572731300.pdf

17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO

A. CONSERVATION OF ENERGY

(i) The steps taken or impact on conservation of energy;

The operations of the Company are not energy-intensive. However adequate

measures have been initiated for conservation of energy.

(ii) The steps taken by the company for utilizing alternate sources of energy;

Not applicable in view of the nature of activities carried on by the Company.

(iii) the capital investment on energy conservation equipment s;

Not applicable in view of the nature of activities carried on by the Company.

B. TECHNOLOGY ABSORPTION

DISCLOSURE OF PARTICULARS WITH RESPECT TO ABSORPTION OF

TECHNOLOGY ETC.

(i) The efforts made towards technology absorption;

Not applicable in view of the nature of activities carried on by the Company.

(ii) The benefits derived like product improvement cost reduction product developmentor import substitution;

Not applicable in view of the nature of activities carried on by the Company.

(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year)- There is no import of technologies in the lastthree year.

(a) the details of technology imported; N.A.

(b) the year of import; : N.A.

(c) whether the technology been fully absorbed; N.A.

(d) if not fully absorbed areas where absorption has not taken place and the reasonsthereof; and -Not applicable

(iv) The expenditure incurred on Research and Development.- Not applicable

C. FOREIGN EXCHANGE EARNING AND OUTGO

S.NO. PARTICULARS AMOUNT IN INR LAKH
1. FOREIGN EXCHANGE EARNING NIL
2. FOREIGN EXCHANGE OUTGO NIL

18. RISK ASSESSMENT AND MANAGEMENT

Risk is the part of the every one's life while running any business there are manykind of risk is involved to minims the business risk and all the factors that willnegativity effects the organization every company tries to follows a certain procedure forthe forecasting of the risk and the Board of Directors has adopted a Risk ManagementPolicy. Under the Policy regular and active monitoring of business activities isundertaken for identification assessment and mitigation of potential internal andexternal risks. The Company's Risk Management Policy is available at a linkhttp://www.avglogistics.com/upload/document/document 2103954823.pdf

19. DETAILS OF ESTABLSHMENT OF VIGIL MECHANISM

The company has established a Whistle Blower Policy which also incorporates a VigilMechanism in terms of the SEBI (LODR) Regulations 2015 for directors and employeescommensurate to the size and the business of the company to promote ethical behavioractual or suspected fraud or violation of our code of conduct and ethics. Under the saidmechanism the employees are free to report violations of applicable laws and regulationsand the code of conduct. It also provide for adequate safeguards against the victimizationof persons who use such mechanism.

The Whistle Blower Policy of the Company is also available on the website of thecompany at the link http://www.avglogistics.com/upload/document/document 1493266758.pdf.During the year no whistle blower event was reported & mechanism is functioning well.Further no personnel have been denied access to the Audit Committee.

20. MATERIAL ORDERS OF JUDICIAL BODIES / REGULTORS

There was no such order passed by any tribunal or court or regulator which may haveimpact upon the going concern status and company s operations in future.

21. AUDITORS

a) Statutory Auditor

In accordance with Section 139 of the Companies Act 2013 and Rules made thereunderMembers at the 9th Annual General meeting of the Company approved theappointment of Statutory Auditors M/s MSKA & Associates (Formerly known as M/s. MZSK& Associates) Chartered Accountants (FRN 105047W) Chartered Accountants for aperiod of five (5) consecutive years starting from F.Y. 2018-19 to 2022-23.

The Statutory Auditors have not reported any frauds under Section 143(12) of the Act.

b) Internal Auditor

Pursuant to Section 138 of the Companies Act 2013 & rules made thereunder in themeeting of Board of Directors held on 27thOctober 2021 M/s AASM & Co. wasReappointed as Internal Auditors of the company for the Financial Year 2021-22.

c) Secretarial Auditor

Pursuant the provision of the Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial personal) Rules 2014 theboard appointed M/s NPS & Associates practicing Company Secretaries to conductSecretarial Audit of the Company for the financial year 2020- 2021 in the board meetingheld on 12th October 2021.

d) Cost Auditor

The provisions of Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 and Rule 14 of the Companies (Audit and Auditor) Rules2014 are not applicable for the business activities carried out by the Company.

22. SECRETARIAL AUDIT REPORT

Pursuant the provision of the Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial personal) Rules 2014 theboard appointed M/s NPS & Associates practicing Company Secretaries to conductSecretarial Audit of the Company for the financial year 2020- 2021. The Secretarial Auditreport in Form MR-3 is attached as Annexure-E and forms part of this report. TheSecretarial Audit Report is self explanatory and no comments are required to be given onthe same except delay in filing of financial results for the period ended on 31stMarch2021 by 47 days as such NSE levied a penalty of Rs. 253800 .

23. EXPLANATIONS IN RESPONSE TO AUDITORS QUALIFICATIONS

With regard to the Statutory Audit Report for the Financial Year 2020-21 there are noqualifications reservations or adverse remarks made by the Auditors. Pursuant toprovisions

of section 143 (12) of the Companies Act 2013 the Statutory Auditors have not reportedany incident of fraud to the Audit Committee during the year under review.

BY THE COMPANY SECRETARY IN PRACTICE IN HIS SECRETARIAL AUDIT REPORT;

There are no qualifications reservations adverse remarks or disclaimers made by M/sNPS & Associates practicing Company Secretaries in his Secretarial Audit Reportexcept certain compliances complied with by paying additional fees or penalty and it wasexplained to the Secretarial auditor that the company has filed all the requisite penaltywith the Stock exchange.

24. COMPLIANCE WITH SECRETARIAL STANDARD

During the year your Company has duly complied with the provisions of all applicableSecretarial Standards viz. the Secretarial Standard-1 on Board Meetings (SS-1) and theSecretarial Standard-2 on General Meetings (SS-2) issued by The Institute of CompanySecretaries of India and approved by the Central Government and that such systems areadequate and operating effectively.

25. REPORTING OF ANY PROCESS INITIATED UNDER THE INSOLVENCY AND BANKRUPTCY CODE2016(IBC):

During the financial year 2020-2021 under review the Company has not passed or filedany resolution/application or by any financial or operational creditor against the Companyunder the Insolvency and Bankruptcy Code 2016 before National Company Law Tribunal.

26. DETAILS OF ANY FAILURE TO IMPLEMENT ANY CORPORATE ACTION:

During the financial year 2020-2021 under review the Company has not failed toimplement any corporate action within the specified time Limit as declared under Section125 of the Companies Act 2013 and relevant rules made there under.

27. Annual Return

Extract of Annual Return in Form MGT-9 containing details as on the Financial Yearended March 31 2021as required under Section 92(3) of the Companies Act 2013 read withthe Companies (Management and Administration) Rules 2014 is annexed herewith asAnnexure-F which forms part of this report.

28. OTHER DISCLOSURES

A. CONSOLIDATED FINANCIAL STATEMENTS

In accordance with Section 133 of the Companies Act 2013 read with Rule 7 of theCompanies (Accounts) Rules 2014 issued by the Ministry of Corporate Affairs ConsolidatedFinancial Statements of the Company and its Associate has been prepared for the FY2020-2021. The audited consolidated financial statements along with the auditor

s report thereon forms part of this Annual Report. The consolidated financialstatements presented by the Company include the financial results of its Associate. Theaudited standalone financial statements of these entities have been reviewed by the AuditCommittee and the Board and will be made available on our

websitehttp://www.avglogistics.com/upload/document/document 865376006.pdf Thesedocuments will also be available for inspection during business hours at our registeredoffice of the Company.

B. HUMAN RESOURCE DEVELOPMENT

Considering the huge scope of growth in organized industry we are putting our bestefforts to cater to such developments in a much more planned way when it comes to dealingwith our employee base. A continuous effort is being made to make AVG a great place ofwork by providing a platform to employees where they feel empowered & engaged. At AVGwe always strive for continuous improvement and believe in our strong foundation whichgets reflected in our values and systems.

With a view to ensure the overall growth as well as the talent of the employees theCompany arranged in-house training and development programmes from time to time for theemployees working in the various departments of the Company of almost every segment. Thusthe morale of employees continued to remain high during the year contributing positivelyto the progress of the Company. This is a challenge as only growth can fulfill theseaspirations and in today s market scenarios one has to perform extraordinarily to achievegrowth.

29. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year 2020-21 as stipulated underRegulation 34(2)(e) of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 is attached as Annexure-G forming part of thisAnnual Report and gives detail of overall industry structure developments performanceand state of affairs of the Company s operations during the year.

30. CORPORATE GOVERNANCE

Since the Company Securities are listed on SME Emerge platform of NSE by virtue ofRegulation 15 of SEBI (Listing Obligation & Disclosure Requirements) Regulations 2015the compliance with the corporate governance provisions as specified in regulations 17 to27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and para C D and E ofSchedule V are not applicable to the Company. Hence Corporate Governance does not formpart of this Board Report.

However with the increase in the competitive environment in all kind of businessscenario the concept of corporate governance becomes very popular. As such the companyalways shown their interest in adopting business policies strategies as well as laid downprocedures to ensure the complete and comprehensive transparency in the operationalactivities of the company in almost every level of the organization and to have to themaximum possible extent the disclosure in order to introduce the philosophy of corporategovernance in the organization. Besides the company always adheres to all the applicablelaws by ensuring timely compliances thereof as well as to have comprehensive disclosuresby way of presenting various documentations reports etc.

31. POLICIES ADOPTED BY THE COMPANY

Your Company has adopted various policies for the smooth working of the company whichare as follows:

POLICY ON ARCHIVAL OF DOCUMENTS

This policy deals with the retention and archival of the corporate record theserecords are prepared by the employees of the company under this policy any materialinformation relating to the company shall be hosted on the website of the company for theinvestors and public and remain there for period of five year. The policy of the companyfor the access is available on this linkhttp://www.avglogistics.com/upload/document/document 1550348007.pdf

CODE OF PRACTICE & PROCEDURE FOR FAIR DISCLOSURE

Certain code of practice is required from the senior management including the Board ofDirectors of the Company; they have to be abiding by the rules and laws applicable on thecompany for the good governance and business ethics. It describes their responsibility andaccountability towards the company. Policy of the company relating to that is available onthis link http://www.avglogistics.com/upload/document/document 236424347.pdf

NOMINATION AND REMUNERATION

Based on the recommendations of the Nomination and Remuneration Committee the Boardhas approved the Remuneration Policy for Directors KMP and all other employees of theCompany. As part of the policy the Company strives to ensure that:

a. The level and composition of remuneration is reasonable and sufficient to attractretain and motivate Directors of the quality required to run the Company successfully;

b. Relationship between remuneration and performance is clear and meets appropriateperformance benchmarks.

c. Remuneration to Directors KMP and senior management involves a balance betweenfixed and incentive pay reflecting short and long-term performance objectives appropriateto the working of the Company and its goals.

d. Policy relating to the nomination and remuneration of the company is available onthe

website of the company at the link

http://www.avglogistics.com/upload/document/document 654807423.pdf

PRESERVATION OF DOCUMENTS

The Corporate records need to be kept at the places and manner defined under the Actpolicy relating to that for the safe keeping of the documents is available at a linkhttp://www.avglogistics.com/upload/document/document 2017244961.pdf

RELATED PARTY TRANSACTIONS

The Objective of the Policy is to set out:

a. The materiality thresholds for related party transactions;

b. The manner of dealing with the transactions between the Company and its relatedparties based on the Act.

c. your company adopted this policy for dealing with parties in a transparent manner

available at this link

http://www.avglogistics.com/upload/document/document 2125338623.pdf

TERMS AND CONDITIONS FOR APPOINTMENT OF INDEPENDENT DIRECTORS

Independent directors are the key part of the board according to the Schedule IV to theCompanies Act 2013 they are skilled experienced and knowledgeable persons they arerequired on the board to take improved and better decisions policy relating to theappointment will be help full for the board policy of the company is available at a linkhttp://www.avglogistics.com/upload/document/document 336983809.pdf

FAMILIARIZATION PROGRAMME OF INDEPENDENT DIRECTORS

Under Familiarization programme all Independent Directors (IDs) inducted into the Boardare given an orientation presentations are made by Executive Directors (EDs) and SeniorManagement giving an overview of our operations to familiarize the new IDs with theCompany s business operations. The new IDs are given an orientation on our products groupstructure and subsidiaries board constitution and procedures matters reserved for theBoard and our major risks and risk management strategy. This policy includes to keepupdated to the independent directors about the working of the company and projects inwhich company is involved various programme are conducted by the company for the IDs. ThePolicy on the Company s Familiarization Programme for IDs can be accessed at a linkhttp://www.avglogistics.com/upload/document/document 923070543.pdf

MATERIALITY POLICY

From the point of Listed entity investors of the entity of the also expecting more andmore information for the company so under this policy the management of the companydetermines the material events of the company and disclosed them for their investors.Under this policy company may decide all those events and information which are materialand important that is compulsory to be disclosed for the investors about the companypolicy related to this is available at a linkhttp://www.avglogistics.com/upload/document/document 177459394.pdf

POLICY FORVERIFICATION OF FIXED ASSETS

The Company conducts the physical verification of its fixed assets with the object toidentify the existence quantity and condition of its fixed assets. Now with a view toexercise better and effective checks and control upon the fixed assets a detailed andcomprehensive policy has been developed and duly approved by the Board of directors. ThePolicy for verification of fixed assets can be accessed at a linkhttp://www.avglogistics.com/upload/document/document 1128398398.pdf

32. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

Our Company is an equal opportunity provider and believes in providing opportunity andkey positions to women professionals. At the same time it has been an Endeavour of theCompany to support women professionals through a safe healthy and conducive workingenvironment by creating and implementing proper policies to tackle issues relating to safeand proper working conditions for them. As per the provisions of section 21 and 22 of theSexual Harassment of Women at Workplace the company in any manner a code of conduct isrequired for them for their unbiased comments regarding the working of the company. Theywill follow the code while imparting in any activity of the company policy deals with thecode of conduct of the Independent Directors their duties and responsibilities towardsthe company is available at a link

http://www.avglogistics.com/upload/document/document 1485254330.pdf. During the yearunder review there were no cases filed pursuant to the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

Number of complaints filed during the Financial Year NIL
Number of cases pending as on the end of the Financial Year NIL

33. ACKNOWLEDGEMENT

The Directors take this opportunity to express their gratitude towards the Company scustomers shareholders investors suppliers bankers financial institutions auditorsand Central & State Governments for their everlasting support to the Company. TheDirectors also wish to place on record their appreciation to employees and associates atall levels for their diligence loyalty and commitment

FOR AVG LOGISTICS LIMITED
SANJAY GUPTA
CHAIRMAN
DIN: 00527801
Place: NEW DELHI
Date: 27.10.2021

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