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Balaji Amines Ltd.

BSE: 530999 Sector: Industrials
NSE: BALAMINES ISIN Code: INE050E01027
BSE 00:00 | 07 Jul 2930.35 55.00
(1.91%)
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NSE 00:00 | 07 Jul 2929.15 50.70
(1.76%)
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OPEN 2900.05
PREVIOUS CLOSE 2875.35
VOLUME 2133
52-Week high 5220.00
52-Week low 2680.05
P/E 30.84
Mkt Cap.(Rs cr) 9,494
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2900.05
CLOSE 2875.35
VOLUME 2133
52-Week high 5220.00
52-Week low 2680.05
P/E 30.84
Mkt Cap.(Rs cr) 9,494
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Balaji Amines Ltd. (BALAMINES) - Director Report

Company director report

To the Members

The Directors are pleased to present the 33rd Annual Report of Balaji Amines Limited.

1. FINANCIAL RESULTS

(Rs. In Lacs)
Particulars

Standalone

Consolidated

2020-21 2019-20 2020-21 2019-20
Revenue from Operations 122777.95 91905.41 131145.51 93577.18
Other Income 1203.04 1026.28 607.41 501.38
Total Revenue 123980.99 92931.69 131752.92 94078.56
Profit before Finance Charges Tax Expenses Exceptional items and Depreciation 33864.90 19002.78 37929.87 18576.12
Less : Depreciation 2334.30 2418.14 3441.10 3162.30
Profit before Finance Charges Tax Expenses Exceptional items 31530.60 16584.64 34488.77 15413.82
Less : Finance Charges 533.47 1213.23 1829.23 2303.46
Profit Before Tax Expenses 30997.13 15371.41 32659.54 13110.36
Provision for Tax 8002.49 4424.25 8486.44 3797.98
Adjustments of earlier year Tax Provision (176.46) (428.15) (176.46) (434.65)
Profit After Tax 23171.10 11375.31 24349.56 9747.03
Total Comprehensive Income 23171.10 11375.31 24349.56 9747.03
(a) Shareholders of the Company 23171.10 11375.31 23819.25 10479.75
(b) Non-controlling interests - - 530.31 (732.72)
Less : Transfer to Reserves 2317.11 1137.53 2317.11 1137.53
Balance 20853.99 10237.78 21502.14 9342.22
Balance of profit of earlier years 57826.10 49699.62 56876.19 49645.30
Less: Final Dividend paid on Equity Shares (2018-19) - 907.23 - 907.23
Interim Dividend paid on Equity Shares (2019-20) - 842.42 - 842.42
Final Dividend paid on Equity Shares (2019-20) 194.41 - 194.41 -
Dividend Distribution Tax (Final Dividend 2018-19) - 188.46 - 188.46
Dividend Distribution Tax (Interim Dividend 2019-20) - 173.19 - 173.19
Others - Transitional Provision Effect of Ind AS116 - 0.00 - 0.03
Balance Carried Forward 78485.68 57826.10 78183.92 56876.19

2. PERFORMANCE HIGHLIGHTS

Your Company has achieved a Gross Income of Rs.122777.95 Lacs on standalone basisduring the 202021. The Profit After Tax for the year stood at Rs.23171.10 Lacs.

Further details of operations are given in the Management Discussion and AnalysisReport which forms part of this report.

3. DIVIDEND

During the Financial Year based on the Company's performance the Directors havedeclared dividend on equity shares @ Rs.4/- (Four only) at 200% of the face value ofRs.2/-. If approved by the Members would involve a cash outflow of '1296.04 Lacs Pursuantto Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Company has framed a Dividend Distribution Policy and the same is herewithannexed as 'Annexure I' to this report. The Dividend Distribution Policy is posted on thewebsite of the Company and the web link is http://www.balajiamines.com/investor-relations

4. TRANSFER TO RESERVES

Your Company proposes to transfer a sum of Rs.2317.11 Lacs to the General Reserves. Anamount of Rs.20853.99 Lacs is proposed to be retained in the statement of profit andloss.

5. SUBSIDIARIES

Balaji Speciality Chemicals Private Limited (BSCPL) is the only Subsidiary of theCompany BSCPL is engaged in Manufacturing of Ethylenediamine (EDA) Piperazine(Anhydrous) Aminoethylpiperazine (AEP) and Diethylene triamine (DETA) and other SpecialtyChemicals.

6. CONSOLIDATED FINANCIAL STATEMENTS

As required pursuant to the provisions of Section 129 of the Companies Act 2013 andthe Securities and Exchange Board of India (Listing Regulations and DisclosureRequirements) Regulations 2015 the Consolidated Financial Statements of the Company areprepared in accordance with the Accounting Standards issued by the Institute of CharteredAccountants of India on the basis of the audited financial statements of the Company andits subsidiaries.

As per the provisions of Section 136 of the Companies Act 2013 the Company will alsoplace separate Audited accounts of its Subsidiaries on its website.

The Statement containing salient features of the financial statements of thesubsidiaries in Form AOC-1 is attached as 'Annexure II' to this Annual Report.

7. CREDIT RATING

The Credit Rating of the Company is affirmed during the year as "IND AA-"(long term) "STABLE" by India Ratings and Research.

8. DETAILS OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

During 2020-21 no company ceased to be subsidiary of the Company and your company doesnot have any associates or joint ventures.

9. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNEDDURING THE YEAR

The constitution of the Board is in Compliance with the provisions of Section 149 ofthe Companies Act 2013 and the Listing Regulations.

Based on the recommendation of Nomination and Remuneration Committee Mr. A PrathapReddy Executive Chairman of the Company Mr. A Srinivas Reddy Wholetime Director of theCompany Mr. G Hemanth Reddy Wholetime Director and CFO of the Company Mr. D Ram ReddyManaging Director of the Company and Mr. N Rajeshwar Reddy Joint Managing Director of theCompany were re-appointed by the Board of Directors of the Company in their meeting heldon 8th February 2021 for a period of 5 years w.e.f 1st April 2021 to 31st March 2026 subject to approval of shareholders in the Annual General Meeting. Accordingly resolutionseeking approval of Shareholders for their re appointment forms part of the Notice of the33rd AGM.

Mr. D. Ram Reddy retires by rotation and being eligible offers himself forre-appointment at the 33rd Annual General Meeting (AGM) of the Company scheduled to beheld on 9th August 2021.

During 2020-21 there is a casual vacancy in the office of Company Secretary andCompliance Officer on 21st January 2021.

10. DECLARATION BY INDEPENDENT DIRECTORS

Your Company has received declarations from all the Independent Directors of theCompany confirming that they fulfill the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 and the Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015.

11. MEETINGS

During the year four meetings of the Board of Directors were held as moreparticularly disclosed in the attached Report on Corporate Governance. The intervening gapbetween any two meetings was within the prescribed period.

The number and dates of meetings held by the Board and its Committees attendance ofDirectors and details of remuneration paid to them is given separately in CorporateGovernance Report.

None of the Directors are disqualified under Section 164(2) of the Act. Certificate onnon-disqualification as required under Regulation 34 of SEBI (Listing Obligation &Disclosure Requirements) Regulations 2015 is annexed to this Annual Report.

Committees of the Board: Details of committees of the Board their composition andother details are provided in the corporate governance section which forms part of thisannual report.

Meetings of Independent Directors

As stipulated by the Code of Independent Directors under the Act and the ListingRegulations one Meeting of Independent Directors was held during the year.

12. BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and regulations contained in thechapters of the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 the Board has carried out the annual performanceevaluation of its own performance by the Directors individually (including IndependentDirectors) as well as the evaluation of the working of its Audit Nomination andRemuneration and other Committees.

A structured questionnaire was prepared after taking into consideration inputs receivedfrom the Directors covering various aspects of the Board's functioning such as adequacyof the composition of the Board and its Committees Board culture execution andperformance of specific duties obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgments safe guarding the interest of theCompany.

The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman and the Non-Independent Directors wascarried out by the Independent Directors. The Directors expressed their satisfaction withthe evaluation process.

Familiarisation program for Directors:

A formal familiarisation programme was conducted about the amendments in the CompaniesAct Rules prescribed thereunder SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and all other applicable laws to the Company.

It is the general practice of the Company to notify the changes in all the applicablelaws from time to time in Board Meetings conducted.

13. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Companies Act 2013 your Directors confirm that tothe best of their knowledge and belief and according to the information and explanationavailable to them

i. In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

ii. Such accounting policies as mentioned in the notes to the financial statements havebeen selected and applied consistently and judgments and estimates that are reasonable andprudent made so as to give a true and fair view of the state of affairs of the Company atthe end of 2020-21 and of the statement of profit of the Company for that period;

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

iv. The annual accounts for the year 2020-21 have been prepared on a going concernbasis;

v. That the proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.

That system to ensure compliance with the provisions of all applicable laws were inplace and were adequate and effectively mentioned under various heads of the departmentswhich are in turn reporting to the Wholetime Directors.

14. RESEARCH & DEVELOPMENT

Your Company has been carrying out continuous Research and Development activities inthe following areas:

a) Identification of new products and development activities of latest processtechnologies are continuously worked on.

b) Continuous improvement of processes and fine tuning of process parameters tooptimize utilisation of energy utilities & raw materials consumption and alternateroutes are being looked at.

c) Backward & forward integration of products to improve value chain and betterutilisation of all the resources.

d) Adoption of advanced technology in recovering waste water has resulted in minimizingthe impact on environment and concentration of core principle of Reduce Reuse and Recycleof all the resources.

e) Several improvements in ACETONITRILE plant have been initiated which have resultedin lower consumption co-efficient and higher efficiency of plant operations.

f) For sustainable usage of natural resources the Company has initiated various modelsin reducing reusing and recycling of various natural resources.

g) The R&D demonstration projects for Manufacture of THF DMC NEM NMM NMMO andMIPA were undertaken during the year by your company.

h) After successful development of the process (es) the pilot plant-cum-demonstrationplants shall be taken up for implementation.

15. EXPANSION/DIVERSIFICATION

a) Your company has been allotted 90 Acres of Land at MI DC Chincholi and theMaharashtra state Government has accorded "Mega Project" Status for this newProject.

b) The Environment clearances and consent for establishment have been obtained forseveral products.

c) During the year we have spent an amount of Rs.9509.54 Lacs towards Phase-I ofGreenfield Project for Manufacture of Ethylamines total capex till 21/05/2021 isapproximately Rs.16472.88 Lacs with a capacity of 50TPD and the plant commencedcommercial production on 21/05/2021.

d) For all other Plants such as DMC ACN and Methylamines etc the detailedengineering and procurement of Equipment is in progress.

e) DMC Plant is expected to be commencing production by the end of 2021-22.

16. CHANGE IN NATURE OF BUSINESS

There is no change in the nature of business during the year.

17. MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments affecting the financial position of your Companyhave occurred after the closure of 2020-21 till the date of this Report.

18. REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors and Senior Management personneland fix their remuneration. The Remuneration Policy is posted on the website of theCompany at the link: www.balaiiamines.com/investor- relations.

19. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

20. ANNUAL RETURN

The Annual Return of the Company as on 31st March 2021 is available on the Company'swebsite and can be accessed at www.balaiiamines.com/investor-relations.

21. PARTICULARS OF EMPLOYEES

In term of the provisions of Section 197(12) of the Companies Act 2013 read with Rule5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits set out in the said rules are provided in 'Annexure III' tothis report.

22. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS

The Company has in place proper and adequate internal control systems commensurate withthe nature of its business size and complexity of its operations. Internal controlsystems comprising of policies and procedures designed and implemented to ensurereliability of financial reporting timely feedback on achievement of operational andstrategic goals compliance with policies procedure applicable laws and regulations andthat all assets and resources acquired are used optimally.

23. STATUTORY AUDITORS

M/s. Ayyadevara & Co. Chartered Accountants were appointed as Statutory Auditorsof the Company for a period of 5 Years from the Conclusion of 29th Annual General Meetingof the Company till the conclusion of 34th Annual General Meeting of the Company subjectto ratification by members in every Annual General Meeting. However by the companies(Amendment) Act 2017 provisions pertaining to ratification of appointment of StatutoryAuditor has been done away with effect from 7th May 2018. Hence the agenda forratification of appointment of M/s. Ayyadevara & Co. Chartered Accountants asStatutory Auditors .is not necessary.

The Independent Auditors report given by M/s. Ayyadevara & Co. CharteredAccountants the Statutory Auditors of the Company on standalone and consolidatedFinancial Statements of the Company does not contain any qualification reservation oradverse remark.

24. REPORTING OF FRAUDS

During the year under review there was no instance of fraud which required theStatutory Auditors to report to the Audit Committee and /or Board under Section 143(12) ofthe Companies Act 2013 and the rules made thereunder.

25. INTERNAL AUDITORS

The Board of Directors based on the recommendation of the Audit Committee havere-appointed M/s. Aherkar & Co Chartered Accountants Solapur as the InternalAuditors of your Company. The Internal Auditors are submitting their reports on monthlybasis.

26. COST AUDITORS

In accordance with Section 148(3) and other applicable provisions if any of theCompanies Act 2013 and the Companies (Audit and Auditors) Rules 2014 the AuditCommittee has recommended and the Board of Directors had appointed Mr. N.V.S. KapardhiPracticing Cost Accountants Hyderabad as Cost Auditors of the Company to carry out thecost audit of the products manufactured by the Company during 2021-2022 on a remunerationof Rs.75000/- (Rupees Seventy Five Thousand only). The remuneration payable to the costauditor is required to be placed before the Members in a general meeting for theirapproval. Accordingly a Resolution seeking Members' approval for the remuneration payableto Mr. N.V.S. Kapardhi Cost Accountants is included at Item No. 4 of the Noticeconvening the Annual General Meeting.

27. SECRETARIAL AUDITORS & SECRETARIAL AUDIT REPORT

Pursuant to provisions of Section 204 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board has appointedM/s. P. S. Rao & Associates Practicing Company Secretaries to conduct SecretarialAudit for 2020-21. The Secretarial Audit Report pursuant to Section 204(1) of theCompanies Act 2013 for the financial year ended 31st March 2021 is given in 'AnnexureIV' attached hereto and forms part of this Report.

The Secretarial Audit Report does not contain any qualification reservation or adverseremark on the Company. However Secretarial Auditors have given their observation as below:

"Registration of one of the Independent Directors of the Company in theIndependent Directors Data Bank has not been done during the window period provided byMinistry of Corporate Affairs"

Reply to Observation in secretarial Audit Report:

Due to inadvertence and oversight the registration of one of the Independent Directorsof the Company was not made during the window period provided by the Ministry of CorporateAffairs. The window for registration is expected to be made available and the IndependentDirector shall register in the Independent Directors Data Bank.

The Annual Secretarial Compliance Report issued by M/s. P.S. Rao & AssociatesCompany Secretaries pursuant to SEBI circular dated February 8 2019 is forming part ofthe Corporate Governance Report.

28. VIGIL MECHANISM

The Company has formulated a Whistle Blower Policy in terms of Section 177 of theCompanies Act 2013 and as per Regulation 22 of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 and Securitiesand Exchange Board of India (Prohibition of Insider Trading) Regulations 2015 for theemployees to report their grievances / concerns about instances of unethical behavioractual or suspected fraud or violation of Company's Code of Conduct by means of ProtectedDisclosure to the Authorised Officer or the Chairman of the Audit Committee.

The vigil mechanism / whistle blower policy may be accessed on the Company's website atthe link: www.balaiiamines.com/investor-relations

29. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARRINGS AND OUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3) (m) of the Companies

Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 is annexed herewithas 'Annexure V'.

30. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY

All related party transactions that were entered into during the financial year were atan arm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large.

During the year all Related Party Transactions were placed before the Audit Committeeand also to the Board for approval. Prior omnibus approval of the Audit Committee wasobtained for the transactions which were of a foreseen and repetitive nature.

The Policy on Related Party Transactions as approved by the Board of Directors of theCompany is uploaded on the website of the Company and the same can be accessed at thelink: www.balaiiamines.com/investor-relations The particulars of contracts or arrangementswith related parties referred to in sub-section (1) of Section 188 of the Companies Act2013 in Form AOC-2 and disclosures under Schedule V of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexedas 'Annexure VI' to this report.

31. RISK MANAGEMENT

The Company has constituted a Risk Management Committee and formulated a policy on theRisk Management in accordance with the Companies Act 2013 and Regulation 21 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The details ofCommittee and its terms of reference are set out in the Corporate Governance Reportforming part of the Board's Report. The Risk Management Policy of the Company is posted onthe website of the Company and the web link http://www.balaiiamines.com/investor-relations

32. CORPORATE SOCIAL RESPONSIBILITY

The Board in compliance with the provisions of Section 135(1) of the Companies Act2013 and rules made thereunder has constituted CSR Committee with Mr. Kashinath R. DholeIndependent Director Mr. D. Ram Reddy Managing Director and Mr. N. Rajeshwar ReddyJoint Managing Director of the Company as its Members. The CSR policy has been placed onthe Website of the Company and can be accessed through the link: www.balajiamines.com/investor-relations and a brief outline of the CSR Policy and the CSRinitiatives undertaken by the Company during the year are mentioned in Annual Report onCorporate Social Responsibility (CSR) activities in the Annexure VII which formspart of this report.

33. FIXED DEPOSITS

Your Company has not accepted any fixed deposits and as such no principal or interestwas outstanding as on the date of the Balance Sheet.

34. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators or courts ortribunals that would impact the going concern status of the Company and its futureoperations.

35. MANAGEMENT DISCUSSION & ANALYSIS

The Management Discussion and Analysis as required under Schedule V of the ListingRegulations forms is shown in separate section forming part of the Annual Report.

36. COMPLIANCE wITH SECRETARIAL STANDARDS

During the year under review your Company has complied with the respective SecretarialStandards issued by the Institute of Company Secretaries of India on Board MeetingsGeneral Meetings and Dividend.

37. EMPLOYEE STOCK OPTIONS:

During the FY 2020-21 Company has obtained shareholders approval for implementation of"Balaji Amines Limited Employee Stock Option plan -2020" (ESOP2020).

Company is yet to implement the ESOP Scheme.

38. BUSSINESS RESPONSIBILITY REPORT

Business responsibility reporting for the year under review as required to be reportedunder Regulation 34(2) (f) of Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 is shown in separate section forming partof the Annual Report.

39. CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governancepractices and is committed to transparency in all its operations and activities. A Reporton Corporate Governance along with a Certificate from the Statutory Auditors of theCompany regarding compliance with the conditions of Corporate Governance as stipulated inRegulations 17 to 27 clauses (b) to (i) of sub-regulation (2) of Regulation 46 andparagraphs C D and E of Schedule V of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015.

The report on Corporate Governance for the Year ended March 31 2021 is shown inseparate section forming part of the Annual Report.

40. HUMAN RESOURCES

Your Company considers its Human Resource as the major strength to achieve itsobjectives. Keeping this in view your Company takes all the care to attract train andretain well qualified and deserving employees. The employees are sufficiently empoweredand enabled to work in an environment that inspires them to achieve higher levels ofperformance. The unflinching commitment of the employees is the driving force behindfulfilling the Company's vision. Your Company appreciates the contribution of itsdedicated employees during this pandemic.

41. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF wOMAN AT wORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed ofduring the year:

No. of Complaints received: Nil No. of Complaints disposed of: Nil

42. LISTING wITH Stock EXCHANGES :

The Equity Shares of the Company are listed on NSE Limited and BSE Limited. The annuallisting fees for the years 2021-22 have been paid to these exchanges.

43. ACKNOwLEDGMENT

Your Directors express their sincere appreciation to the customers members dealersemployees bankers State and Central Government Stock Exchanges and all the stakeholdersfor their co-operation and confidence reposed in the Company.

For and on Behalf of the Board of Directors

Sd/-

A. Prathap Reddy

Executive Chairman

DIN: 00003967

Date: 24th May 2021

Place: Secunderabad

.