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Balkrishna Industries Ltd.

BSE: 502355 Sector: Auto
BSE 00:00 | 26 May 2196.85 34.85






NSE 00:00 | 26 May 2199.85 38.35






OPEN 2160.00
VOLUME 26585
52-Week high 2724.40
52-Week low 1681.95
P/E 30.11
Mkt Cap.(Rs cr) 42,465
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2160.00
CLOSE 2162.00
VOLUME 26585
52-Week high 2724.40
52-Week low 1681.95
P/E 30.11
Mkt Cap.(Rs cr) 42,465
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Balkrishna Industries Ltd. (BALKRISIND) - Director Report

Company director report



Dear Shareholders

Your Directors are pleased to present the 59th Annual Report of BalkrishnaIndustries Limited (the "Company") along with the audited Financial Statementsfor the financial year ended 31st March 2021. The consolidated performance ofthe Company and its subsidiaries for the year ended 31st March 2021 has beenreferred to wherever required.


( Rs. in Lakhs)

Standalone Consolidated
Particulars Year Ended 31st March 2021 Year Ended 31st March 2020 Year Ended 31st March 2021 Year Ended 31st March 2020
Revenue from Operations 575792 478249 578319 481124
Other Income 16145 24877 17216 25078
Total Income 591937 503126 595535 506202
Gross Profit 193714 149085 197122 151313
Less: Depreciation 40615 36801 41630 37361
Profit before tax 153099 112284 155492 113952
Less: Provision for tax
Current Tax 36916 29230 37904 29431
Deferred Tax 645 (11444) 645 (11444)
Profit after Tax 115538 94498 117753 95965


The key product range of your Company is Specialty Tires commonly known as "OffHighway Tires" which caters to Agriculture Industrial Construction EarthmovingMining Port Lawn and Garden and All-Terrain Vehicle (ATVs) Tires. The Company’sCarbon Black Product which is mainly used for captive and partly sold in Market has beenwell accepted in terms of quality.

The Tire segment is highly technical & capital intensive and known as "largevarieties low volume segment" where any credible player needs to maintain largenumber of Stock Keeping Units (SKUs) to meet the diverse requirement of its customersworldwide. Apart from this it needs to service its clients pre & post sales. Whilethe sub segment (agriculture) is largely known as non-cyclical in nature the other subsegment (industrial construction and mining) is generally considered as cyclical and theperformance of it is largely linked to overall economic outlook of the world. The marketfor Company’s range of tires is mainly Europe America Australasia and India.Considering that several European countries and USA has a very strong vaccination programthe economy seems to opening up and despite the second wave of Covid-19 in India theoutlook is optimistic.


Standalone: During the year under consideration on Standalone basis your Companyachieved Revenue from Operations of Rs. 575792 Lakhs as against Rs. 478249Lakhs during the previous financial year an increase of 20.39%. Earnings before InterestDepreciation and Tax (EBIDTA) has increased to Rs. 194696 Lakhs from Rs. 149812 Lakhsduring the previous financial year an increase of 29.96% and Net profit has increasedtoRs. 115538 Lakhs from Rs. 94498 Lakhs during the previous financial year an increaseof 22.27%. The revenue from exports was more than 78%.

Consolidated: During the year under consideration on Consolidated basis yourCompany achieved Revenue from operations Rs. 578319 Lakhs as against Rs. 481124Lakhs during the previous financial year an increase of 20.20%. Earnings before InterestDepreciation and Tax (EBIDTA) has increased to Rs. 198260 Lakhs from Rs. 152203 Lakhsduring the previous financial year an increase of 30.26% and Net profit has increasedtoRs. 117753 Lakhs from Rs. 95965 Lakhs during the previous financial year an increaseof 22.70%.


Your Company enjoys the status of "Four Star Export House".


During FY 2020-21 the Board of Directors of your Company at its meeting held on 8thFebruary 2021 had approved following New Projects:

Brown Field Tire Project: Considering the overall increase in the demand of productsyour Company has commenced set up of Brownfield and Debottlenecking project along withaddition of balancing and ancillary equipment at Company’s plant located at Bhuj. Theimplementation of said project will result in increased achievable tire productioncapacity by 50000 MTPA and the said project is expected to be completed by H2FY23. Theestimated Capex cost of the project is up to Rs. 800 crores.

Enhancement of Carbon Black capacities and setting up a Captive Power Plant:Considering the overall demand / supply outlook as well as internal demand of CarbonBlack your Company has embarked to enhance the installed capacity of carbon black from anachievable capacity 115000 MTPA to 200000 MTPA including 30000 MTPA of high value ofadvanced carbon black material. The increase in production would obviate an increasedpower requirement. To meet the additional power requirement the Company proposes to setup an additional power plant of 20 MW by tapping flue gas a by-product from the carbonblack plant which will provide the required additional power at lower cost. The capex ofthe increased capacity of carbon black and co-gen power plant will be Rs. 650 crores andis expected to be completed by H1FY23.

Modernization Automation and Technology Upgradation: The Board has approved anestimated capex of Rs. 450 crores for modernization automation and technology upgradationof certain existing equipment and installation of automated material handling systems.Capex is being undertaken at existing facilities at Company Plants located at Rajasthanand Bhuj leading to further improvement in quality and efficiency. The said project isexpected to be completed by H1FY23.

The total planned Capex up to Rs. 1900 Crores will be funded by Internal Accruals andDebt if required.

Bhuj Plant: Expansion of mixing facility and enhancing the warehousing capacity hasbeen completed and setting up of ultra large sized all steel OTR Radial Tire Plant iscompleted and undergoing final trial run.

Waluj Plant: The Green Field Tire project was progressing as per schedule however dueto COVID-19 the work was temporarily shut from 25th March 2020 to 20thApril 2020. Thereafter the project work resumed gradually after the lockdown was lifted.Considering the present uncertain situation this project is expected to be completed by30th September 2021.

GreenfieldTire Plant in US: The Board had given its approval for setting up a GreenField Tire Project of 20000 MTPA capacity in USA with an estimated capital outlay up toUSD 100 million through its wholly owned US subsidiary company. After reviewing variousaspects of the project in the backdrop of challenging economic and business environmentthe Board of the Directors at their meeting held on 8th February 2021 decidedto shelve the project.


You are aware of the consistent track record of dividend payment by your Company forthe last over three decades. In keeping with this trend the Board of Directors arepleased to recommend a Final Dividend of Rs. 5 per equity shares for the financial year2020-21 after paying 3 interim dividends during the year aggregating to Rs. 12 per equityshare. The total dividend for the financial year 2020-21 aggregates to Rs. 17 per equityshare. The final dividend is subject to approval of the Shareholders at the ensuing AnnualGeneral Meeting of the Company scheduled to be held on 30th June 2021. Thefinal dividend once approved by Shareholders will be paid within the stipulated timesubject to deduction of tax at source. The Record Date for the purpose of payment of finaldividend will be 21st June 2021.

Pursuant to Regulation 43A of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 ("Listing Regulations 2015") the DividendDistribution Policy can be accessed at Company website at:


The paid-up Share Capital of the Company as on 31st March 2021 remainsunchanged at Rs. 3866 Lakhs. The Company has neither issued shares with differentialvoting rights nor granted stock options nor sweat equity and none of the Directors ofthe Company hold any convertible instruments.


The Company proposes to transfer Rs. 40000 Lakhs to General Reserves.


The vaccination drive across the globe is a silver lining in the dark cloud despiteCovid-19 and gives us strong reasons to see light at the end of the tunnel. As tireindustry’s fortunes are closely linked to economic growth the outlook is positive inthe near to medium term. Overall demand in replacement as well as OEM tires across theglobe including India is encouraging for all segments following recovery in economicactivity which will drive volumes up in the coming fiscal year. The long-term prospects ofthe company are good and promising as your Company continues to explore all the avenues toensure growth of its business which includes deeper penetration into new and existingmarkets. With the continuous expansion of its product range your Company is proud to saythat it has more than 2700 SKUs.


In terms of Section 134(3)(l) of the Companies Act 2013 there are no material changesand commitments affecting the financial position of your Company which have occurredbetween the close of the financial year of the Company on 31st March 2021 towhich the Financial Statements relate and up to the date of this report except a delay incompletion of expansion at Waluj as stated earlier.



Your Company operates into a segment predominantly known as "large varieties - lowvolume segment" which is not only capital intensive but also labour intensive. YourCompany is fully geared to take advantage of the peculiarities of the said segment and hasdeveloped a large base of SKUs to meet the diverse needs and applications.

Moreover this segment is neither exposed to any technological obsolescence nor wildfluctuations in demand for its products.

The Company is continuously marching ahead to explore incremental opportunity in theform of developing "Ultra Large Earthmovers & Mining Radial Tires" marketsand also taking advantage of the shift from Bias to Radial Tires which is growingcontinuously. In order to take advantage of this opportunity the Company had set up anUltra Large size all-steel OTR Radial tire plant and have further added such capacities bysetting up a Brown field tire plant at Bhuj to produce Ultra large size all steel OTRRadial Tires besides other categories of tires. Your Company is proud to be thefirstCompany in India to set up such a plant. Your Company is continuously expanding itsbase into various sub-segments like agricultural industrial construction mining winterand solid tires under both technologies – Bias as well as Radials.

The COVID-19 issue has led to a situation where most of the countries are thinking toreshuffle their sourcing plan / strategy. It may open up lot of opportunities for Indiaincluding our Company.


Like any other Company your Company is also exposed to various threats likecompetition retention of employees labour issues increase in raw material prices andits timely availability etc. An economic downturn or slowdown in the key markets (Indiaand Europe) may lead to decrease volumes and capacity utilisation. Volatile exchange rateand Price Competition are also a threat. A new threat has emerged out of second wave ofCOVID-19 which may change the manner and pattern of the business and also may intensifythe various threats to which we are already exposed to. It may increase the operating costof running the business.


There is no significant change (i.e. 25% or more) in any of the financial ratiosCoverage Ratio Current Ratio Debt-Equity Ratio Operating Profit Margin Net ProfitMargin and Return on Investment.


The Company believes that Internal Control is one of the key pillars of governancewhich provides freedom to the management within a framework of appropriate checks andbalances. The Company has a robust internal control framework which has been developedconsidering the nature size and risks in the business. The Company has adequate internalcontrol systems in place and also has reasonable assurance on authorizing recording andreporting transactions of its operations. The Company has well-placed proper and adequateinternal controls environment commensurate with its size scale and complexities of itsoperations. The Company had already developed and implemented a framework for ensuringinternal controls over financial reporting. This framework includes entity level policiesprocesses and operating level standard operating procedures (SOP). Internal controlsystems are an integral part of your Company’s Corporate Governance structure.Information Technology (IT) policies and processes also ensure that they mitigate thecurrent business risks. The Company has successfully implemented ERP system supported bySAP software & backed by necessary Bandwidth. The systems and processes arecontinuously improved by adopting best in class processes and automation and implementingthe latest IT tools which help further for maintaining financial to provide reasonableassurance with regard to credibility of data and compliances inter-alia:

a. Recording and providing reliable financial and operational information;

b. Complying with the applicable statutes;

c. Safeguarding assets from unauthorized use;

d. Executing transactions with proper authorization and ensuring compliancewith corporate policies;

e. Prevention and detection of Frauds / errors;

f. Continuous updating of IT systems.

The management has assessed the effectiveness of the Company’s internal controlover financial reporting as of 31st March 2021. Your Company has appointed M/sKPMG to assess the effectiveness of internal financial controls of the Company. Theirassessment was based on an internal audit plan which was reviewed in consultation withthe Audit Committee and is found to be quite adequate. The Audit Committee reviewed thereports submitted by the Management and Internal Auditors. Based on their evaluation (asdefined in section 177 of the Companies Act 2013 and Regulation 18 of ListingRegulations 2015) the Company’s Audit Committee has concluded that as of 31stMarch 2021 the Company’s internal financial controls were adequate and operatingeffectively.


With a vibrant team of 2861 employees as on 31st March 2021 your Companybelieves that employees are instrumental in its progress. In Company they work towardsits goal of building the 3s of the organization i.e. sustainable smarter and safer. YourCompany believes in a culture of inclusion trust skill development empowerment anddevelopment for its employees. Your Company continues to invest significantly in buildinga culture of coaching and mentoring and further aims to make coaching mentoring andcommunication ability the foundation of its leadership style which further helps theCompany and its workforce to keep pace with the changing world. Your Company believes thefact that your organization is only as good as its employees. Your Company considers itshuman resources as its biggest asset and believes in People at the heart of its Humanresource strategy which set the Company apart from Company’s peers. Your Companybelieves that employees continuously strive to make the organization as inclusive aspossible. Your Company has established an organization structure that is agile and focusedon delivering business results. With regular communication and sustained efforts it isensuring that employees are aligned on common objectives and have the right information onbusiness evolution. Your Company endeavours to provide employees with all the supportresources and incentives. Your Company ensures that young talent is nurtured and mentoredconsistently that rewards and recognition are commensurate with performance and thatemployees have the opportunity to develop and grow. Your Company strongly believes infostering a culture of trust and mutual respect in all its employees and seeks to ensurethat Company’s values and principles are understood by all and are the referencepoint in all matters. Employee relations continue to be cordial.

COVID-19 has created a lot of challenges on the Human Resources front; both in thestaff category as well as in workmen category.

Your Company has implemented strict Covid-19 protocols regular testing and in-housemedical centre to take care against Covid infections of its employees and their familymembers. To take care of serious infections your Company has also added state-of-the-artICU/HDU unit to its medical centre.


Thristha Synthetics Limited a wholly owned subsidiary of your Company incorporated inyear 2013 has voluntarily made an application with the Registrar of Companies (ROC)Mumbai Ministry of Corporate Affairs for striking off its name from the records of ROCafter meeting / discharging all the necessary requirements for striking off. During theyear under review Ministry of Corporate Affairs vide its order dated 21stSeptember 2020 had struck off the name of the Company from its Register of Companies andhence said Company ceases to exist.

At the end of the year under review the Company had one Domestic and Four OverseasWholly Owned Subsidiary Companies (WOS). The domestic WOS is known as BKT Tires Limitedand the Overseas WOS are BKT EUROPE S.R.L. BKT USA INC BKT TIRES (CANADA) INC. BKT EXIMUS INC. The Company also has one step down subsidiary in the name of BKT Tires Inc. basedin USA which is a 100% subsidiary of BKT EXIM US INC. The Company does not have anymaterial subsidiary as per the thresholds laid down under the Listing Regulations 2015. Apolicy on material subsidiaries has been formulated by the Company and posted on thewebsite of the Company and can be accessed at:

Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 a statement containing the salient features of the financialposition of subsidiary companies in Form AOC-1 attached as Annexure I.


Pursuant to Section 134 (3)(c) and 134(5) of the Companies Act 2013 your Directorsto the best of their knowledge and belief make the following statements that:

(i) that in the preparation of the annual accounts for the year ended 31stMarch 2021 the applicable accounting standards have been followed and there are nomaterial departures from the same;

(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2021 and theStatement of Profit and Loss of the Company for the financial year ended 31 st March2021;

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

(iv) the Directors have prepared the annual accounts of the Company on a "GoingConcern" basis;

(v) the Directors have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and are operating effectively;and

(vi) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that systems are adequate and operating effectively.


All contracts /arrangements / transactions entered by the Company during the financialyear with related parties were in ordinary course of business and on an arm’s lengthbasis. During the year the Company has not entered into any contracts /arrangements /transactions with related parties which could be considered material in accordance withthe policy of the Company on materiality of related party transactions.

Accordingly the disclosure of related party transactions as required under Section134(3)(h) of the Companies Act 2013 in Form AOC - 2 is not applicable to yourCompany.

The Policy on materiality of related party transactions and dealing with related partytransactions are approved by the Board and can be accessed on the Company’s websiteat: The details of transactions / contracts /arrangements entered by the Company with Related parties during the financial year are setout in the Notes to the Financial Statement.

The Board of Directors of the Company has approved the criteria for making the omnibusapproval by the Audit Committee within the overall framework of the policy on relatedparty transactions. Prior omnibus approval is obtained for related party transactionswhich are of repetitive nature and proposed to be entered in the ordinary course ofbusiness and at arm’s length during the financial year. All related partytransactions are placed before the Audit Committee for review and approval.


The Company’s social initiatives empower society at a large and provide a holisticgrowth platform. The Company believes that Corporate Social Responsibility (CSR) projectsundertaken by it should be sustainable with the long-term purpose of improving the qualityof living for the less privileged. The funds on CSR projects / activities are spent verycarefully to ensure that the desired objectives are achieved. The Board of Directors ofthe Company has approved a Corporate Social Responsibility (CSR) Policy based on therecommendation of the CSR Committee. The brief outline of the CSR policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure-II. The Board of Directors has formed a committee on CSR inaccordance with The Companies Act 2013. The terms of reference of the Corporate SocialResponsibility Committee number and dates of meetings held composition and attendance ofthe Directors during the financial year ended 31st March 2021 are givenseparately in the Corporate Governance Report. During the year under review the Companywas required to spend Rs. 2232 lakhs. The Company had identified various CSR projectshaving a total commitment of Rs. 2232 lakhs and had spent an amount of Rs. 1812 Lakhstill March 2021. In terms of Amendment to Companies (Corporate Social ResponsibilityPolicy) Amendment Rules 2021 (the CSR Rules 2021") effective from 22ndJanuary 2021 the Company’s CSR Committee at its meeting held on 8thFebruary 2021 had revised / identified Ongoing Project up to Rs. 420 lakhs. Hence thebalance unspent amount of Rs. 420 lakhs out of Rs. 2232 lakhs have been identifiedasOngoing project which would be spent by the Company within stipulated time. The Companyhas deposited Rs. 420 lacs in a separate Bank account opened with a Scheduled Bank inCompliance with CSR Rules 2021 for the CSR identified projects.

In line with Company’s objective under its CSR policy to support the society at alarge the Company has distributed cooked food and food grains in various part of India tothe people affected by lockdown due to COVID-19. The Company has also distributed PPE kitsand masks to various hospitals in Mumbai and other part of India. The CSR policy of theCompany is available on the Company’s website and can be accessed at: investors-desk.


Risk is an integral and unavoidable component of business. In today’s challengingand competitive environment mitigating risks is imperative. Common risks include changingregulations competition business risk technology obsolescence investments andretention of talent. Business risk inter alia further includes financial risk socialrisk political risk environmental risk and legal risk. For managing risks moreefficiently the Company has undertaken a detailed risk management exercise and hasidentified key risks that can have a critical impact on the Company’s performance.The Company has inter alia identified the following key risks:

Operational Risk:

Operational risks like equipment obsolescence can impact production. To mitigate suchrisks the Company continuously monitors equipment obsolescence and upgrades equipmentfrom time to time and undertakes preventive maintenance measures. The Company has alsomade significant investment in equipment modernization.

Fluctuation in Raw Material prices:

The Company’s major raw material is Natural and Synthetic Rubber Carbon Black andNylon fabric. Due to the high demand of all the major raw materials and shutting down ofsome raw material manufacturers the prices and the supply have been adversely affected.In view of this we foresee an increase in cost which will be set off by an increase inprices over a period of time. The second wave of COVID-19 across the globe has disruptedthe entire supply chain which has led to higher delivery time coupled with increase inlogistic cost. The company is continuously developing alternative sources of raw materialas well as their supply chain to ensure timely delivery of goods at a minimal cost.

Market Risk:

Your Company manages market risk by expanding its presence in different markets deeperpenetration into existing markets and by launching new products. Furthermore the Companyspends requisite amount on marketing and promotional activities to ensure customerretention and brand-building.

COVID-19 including the second wave has led to lockdown across the globe which mayadversely impact the demand to some extent. The Company believes that due to thevaccination drive across the world the disruption in demand if any may be temporary innature and do not foresee any long-term challenges in demand.

Labour Relations:

Since the manufacturing process of the Company is labour intensive it requires lot ofskilled as well as un-skilled workers. Maintaining a huge work force is a big challenge.

In order to mitigate the said risk the Company follows good HR practices to promotethe welfare and safety of its workmen and maintain a cordial working environment. Allworkers are paid more than government stipulated wages.

COVID-19 led to migration of labour from various industrial zones to their home towns;this may create a situation of shortage of labour which may impact the operations of theCompany adversely. Despite this and as mentioned earlier your Company does not foreseeany major challenge as it has taken good care of all its staff members as well as workersduring the period of lockdown and continues to do so regularly ensuring smooth andseamless operations of the Company.

Retention of skilled manpower:

Like other players in the industry the Company is also exposed to this risk moreparticularly when there is shortage of skilled manpower in the industry. COVID-19 hasfurther intensified this risk. However HR practices and rewarding its employeeshandsomely.

Currency Fluctuation:

The Company revenues are mainly generated through exports. Further since most of theraw materials and capital equipment are imported the Company is exposed to foreigncurrency risk. However it enjoys natural hedge as most of its revenues are in foreigncurrency. COVID-19 issue has created imbalance in the economies of various countriesincluding India and therefore we could be exposed to wider risk due to currencyfluctuation.

However since the Company is a net foreign exchange earner and hedges its netexposure well in advance by way of forward contracts it is immune to a great extent fromthe fluctuation in currencies.

RISK MANAGEMENT AND MITIGATION: prioritization of risks followed by coordinated andeconomical application ‘Risk Management’ is the identification of resources tominimize monitor and control the probability and/or impact of uncertain events or tomaximize the realization of opportunities. Risk management also provides a system for thesetting of priorities when there are competing demands on limited resources. Riskmanagement also attempts to identify and manage threats that could severely impact orbring down the organization.

The Company’s Board of Directors has overall responsibility for the establishmentand overseeing of the Company risk management framework. Pursuant to Regulation 21 ofListing Regulations 2015 Risk Management Committee was constituted comprising of Mr.Pannkaj Ghadiali an Independent Director as Chairman of the Committee Mr. Arvind PoddarMr. Rajiv Poddar Mr. Vipul Shah Directors of the Company and Mr. Madhusudan Bajaj KMPare Members of the Committee. The primary objective of the Committee is to control thevarious risks that the Company is exposed to with a view to prevent unacceptable lossesto provide an effective means of identifying measuring and monitoring credit exposurerisks by the Company and to keep such risk at or below predetermined levels. The Companyhas framed an Enterprise Risk Management Policy (the "Policy") to realize thefollowing benefits for the Company:

a. Enhanced risk management for the organization including strategy setting.

b. Facilitate risk-based decision making.

c. Improve governance and accountability.

d. Enhance credibility with key stakeholders such as investors employees governmentregulators society etc.

e. Create Protect and enrich stakeholder value. The policy contains the objectives ofrisk management company’s approach to risk management and the risk organizationstructure for identification management and reporting of risks. The policy specifies theroles and responsibilities of key stakeholders and other key personnel of the company withregards to risk management. The policy also aims to ensure and identify process of riskidentification and management in compliance with the provisions of the Companies Act2013.

Following objectives are achieved through the Risk Management program of the Companyviz: l Enable organizational sustainability taking cognizance of the impact of itsproducts services & operations on society and the environment. l Reducepotential gaps in achieving company’s objectives. l Align and integrateexisting risk management practices in the organization. l Build confidence ofinvestment community and stakeholders. l Enhance Corporate Governance. lSuccessfully respond to changing business environment.

Risk management policies and systems are reviewed regularly to reflect changes inmarket conditions and the Company’s Activities.

The Audit Committee oversees how management monitors compliance with the Company’srisk management policies and procedures and reviews the adequacy of the risk managementframework in relation to the risks faced by the Company. Internal Audit undertakes bothregular and ad hoc reviews of risk management controls and procedures the results ofwhich are reported to the audit Committee.

There are no risks which in the opinion of the Board threaten the existence of theCompany.


Following the resignation of Mr. Basant Bansal as the CFO of your Company w.e.f. 28thAugust 2020 Mr. Madhusudan Bajaj was given additional charge as CFO with immediateeffect and was thereafter appointed and re-designated as President (Commercial) & CFOat the Board Meeting of the Company held on 24th September 2020. Your directorswould like to place on records their appreciation for the services rendered by Mr. Bansalduring his tenure with the Company. As recommended by the Nomination and RemunerationCommittee the Board of Directors of the Company has approved the re-appointment ofMr. Arvind Poddar as Chairman and Managing Director of the Company for a term of fiveyears w.e.f. 1st August 2022 subject to approval of members of the Companyand also subject to sub regulation (1B) of Regulation 17 of Listing Regulations 2015which is proposed to be effective from 1st April 2022 as amended from time totime.

In accordance with provisions of the Companies Act 2013 and Articles of Association ofthe Company Mrs. Vijaylaxmi Poddar Director of the Company retires by rotation at theensuing AGM and being eligible offers herself for re-appointment. The Board recommendsboth the re-appointments.

Brief profile of the Director being re-appointed as required under Regulations 36(3) ofListing Regulations 2015 and Secretarial Standard on General Meetings is provided in theNotice of the forthcoming AGM of the Company.

The Company has received declaration from all Independent Directors of the Companyconfirming that they meet with the criteria of independence as laid down under Section149(6) of the Companies Act 2013 as well as Regulation 16(1)(b) of the ListingRegulations 2015.

The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance Directors’ Report requirement set out bythe SEBI. The Company has complied with the requirements of Corporate Governance asstipulated under the Listing Regulations 2015 and accordingly the Report on CorporateGovernance forms part of this Annual Report. The requisite certificate from the Auditorsof the Company confirming compliance with the conditions of the Corporate Governance isattached to the Report on Corporate Governance.


The Company has devised the Nomination and Remuneration Policy for the selectionappointment and remuneration of Directors Key Managerial Personnel and also remunerationof other employees including Senior Management employees who have the capacity and abilityto lead the Company towards achieving sustainable development. The extract of Nominationand Remuneration Policy is provided in the Corporate Governance Report and forms part ofBoard’s Report.

The Criteria for appointment and remuneration of Directors is as under:

(i) Criteria for Appointment of Managing Director / Whole Time Director/ Director:

The Nomination and Remuneration Committee shall identify persons of integrity whopossess relevant expertise and experience particularly in Tire / Carbon Industryleadership qualities required for the position and shall take into considerationrecommendation if any received from any member of the Board.

(ii) Criteria for Appointment of Independent Director:

The Independent Director shall be of high integrity with relevant expertise andexperience so as to have a diverse Board with Directors having expertise in the fields ofmanufacturing marketing finance taxation law governance and general management.


Annual evaluation of Board its performance Committees and individual Directorspursuant to applicable provisions of the Act and applicable regulations of ListingRegulations 2015 were carried out.

The performance of the Board was evaluated after seeking inputs from all the Directorspresent in the meeting on the basis of criteria such as the board composition andstructure effectiveness of board processes information and functioning etc.

The Board and Nomination and Remuneration Committee had evaluated / reviewed theperformance of individual Directors on the basis of criteria such as the contribution ofthe individual Director to the board and committee meetings like preparedness on theissues to be discussed meaningful and constructive contribution and inputs in meetingsetc.

The Securities and Exchange Board of India (SEBI) vide circular SEBI /HO /CFD /CMD/CIR/ 2017/004 dated 5th January 2017 issued a Guidance Note on BoardEvaluation about various aspects involved in the Board Evaluation process to benefit allstakeholders.

While evaluating the performance the above guidance note was considered. Performanceevaluation of Independent Directors was carried out by the entire board excluding theIndependent Director being evaluated. A meeting of the Independent Director for the FY2020-21 with Mr. Pannkaj Ghadiali as the Chairman was held on 26th March2021 to review the performance of the Non-Independent Directors the Board as a whole andthe Chairman on the parameters of effectiveness and to assess the quality quantity andtimeliness of the flow of information between the Management and the Board. The same werediscussed in the board meeting that followed the meeting of the Independent Directors atwhich the performance of the board its committees and individual Directors were alsodiscussed. The Directors expressed their satisfaction with the evaluation process.

23. AUDITORS: Statutory Auditor:

Pursuant to Section 139 of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 the members of the Company at its AGM held on 9thSeptember 2017 had approved the appointment of M/s. N G Thakrar & Co. CharteredAccountants (Firm Registration No. 110907W) as the Statutory Auditors for a period of fiveyears. Pursuant to amendments in Section 139 of the Companies Act 2013 the requirementsto place the matter relating to such appointment for ratification by members at every AGMis not required. The Auditors have confirmed that they are not disqualified fromcontinuing as Auditors of the Company.

The Notes on Financial Statements referred to in the Auditors’ Report areself-explanatory and do not call for any further comments.

The Auditors’ Report do not contain any qualification reservation adverse remarkor disclaimer.

Internal Auditor:

The Board has appointed M/s. R T D & Associates Chartered Accountants as InternalAuditors for a period of 1 (One) year for Financial Year 2020-21 under Section 138 of theCompanies Act 2013 and they have completed the Internal Audit as per the scope as definedby the Audit Committee.

Secretarial Auditor:

The Company has appointed Mr. G.B.B Babuji Company Secretary in Whole Time Practiceto conduct Secretarial Audit for the financial year 2020-21 as required by Section 204 ofthe Companies Act 2013 and rules made thereunder. The Company provided all assistance andfacilities to the Secretarial Auditors for conducting their audit. Mr. G.B.B Babuji hasalso conducted the Annual Secretarial Compliance pursuant to Listing Regulations 2015.The Secretarial Audit Report for the financial year ended 31st March 2021 isannexed herewith marked as Annexure III.

Cost Auditor:

In terms of Section 148 of the Companies Act 2013 read with Rule 5 of Companies (CostRecords and Audit) Rules 2014 ("Cost Records Rules") as amended from time totime the Company maintained its Cost Records on regular basis in such manner whichfacilitates the calculation as may be prescribed by the Rules. The cost records aremaintained in such manner which enable the Company to exercise to the extent possiblecontrol over the various operating costs to achieve optimum economies in utilization ofresources. Since the Company’s revenue from exports in foreign exchange exceeds 78%per cent of the Company’s total revenue and pursuant to Rule 4 of Cost Records Rulesof Companies Act 2013 as amended from time to time Cost Audit is not applicable to theCompany for the financial year 2020-21.


There are no qualifications in the reports of the Statutory Auditors and SecretarialAuditor. There was no instance of fraud during the year under review which is required tobe reported by Statutory Auditors in their reports as mentioned under sub-section (12) ofSection 143 of the Act.


The industrial relations with staff and workers during the year under review continueto be cordial.


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


i. Vigil Mechanism /Whistle Blower Policy:

The Vigil Mechanism of the Company which also incorporate a whistle blower policy inthe terms of Listing Regulations 2015 deals with instances of fraud and mismanagement ifany. Adequate safeguards have been provided against victimization of persons who use thevigil mechanism. The Policy on vigil mechanism and whistle blower policy may be accessedon the Company’s website at:

ii. Audit Committee:

During the year under review Mr. Sandeep Junnarkar Independent Director was appointedas member of Audit Committee w.e.f. 24th September 2020. Hence consequent toappointment of Mr. Sandeep Junnarkar the Audit Committee was reconstituted and comprisedof the following Directors as on 31st March 2021 viz. Mr. Pannkaj Ghadiali anIndependent Director as Chairman Mr. Rajendra Hingwala Mr. Sandeep Junnarkar & Mrs.Shruti Shah Independent Directors and Mr. Rajiv Poddar Joint Managing Director. All therecommendations made by the Audit Committee have been accepted by the Board.

iii. Number of Board Meetings:

The Board of Directors of the Company met six times in the year the details of whichare provided in the Corporate Governance Report.

iv. Particulars of loans given investment made guarantees given and securitiesprovided:

Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in Note Nos. 5101447 and 50 to the Financialstatement forming part of this Annual Report.

v. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andoutgo:

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under Section 134(3)(m) of theCompanies Act 2013 read with Rule 8 (3) of the Companies (Accounts) Rules 2014 areprovided in Annexure - IV and forms an integral part of this report.

vi. Annual Return:

Pursuant to Section 92(3) read with section 134(3)(a) of the Companies Act 2013 copyof the Annual Return of the Company prepared in accordance with Section 92(1) of the Actread with Rule 11 of the Companies (Management and Administration) Rules 2014 may beaccessed on the Company’s website at:

vii. Particulars of Employees and related disclosures:

The information required under Section 197(12) of the Companies Act 2013 read withRules 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is attached as Annexure - V.

A statement comprising the names of top 10 employees in terms of remuneration drawn andevery person employed throughout the year who were in receipt of remuneration in terms ofRule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are provided in the Report.

However having regard to the provisions of the first proviso to Section 136 of theAct the details are excluded in the report sent to members. Members who are interested inobtaining the particulars may write to the Company Secretary at registered/ corporateoffice of the Company.

viii. Sexual Harassment of Women at Workplace (Prevention Prohibition & Redressal)Act 2013:

The Company has formulated and implemented a policy of prevention of sexual harassmentat the workplace with mechanism of loading/redressal complaints. During the year underreview there were no complaints reported to the Board.

ix. Business Responsibility Report:

As mandated by Regulations - 34(2)(f) of Listing Regulations 2015 BusinessResponsibility Report of the Company for the year ended 31st March 2021describing the initiatives taken by the Company from an environmental social andgovernance prospective in the prescribed form is annexed as Annexure - VI.

x. Compliance with the Institute of Company Secretaries of India ("ICSI")Secretarial Standards:

The relevant Secretarial Standards issued by the ICSI related to the Board Meetings andGeneral Meeting have been complied with by the Company.

No disclosure or reporting is required in respect of the following items as there wereno transaction on these items during the year under review:

a. Details relating to deposit and unclaimed deposits or interest thereon.

b. Issue of equity shares with differential rights as to dividend or voting.

c. Issue of shares (including sweat equity shares) and Employee Stock Option Scheme ofthe Company under any scheme.

d. None of the managerial personnel i.e. Managing Director Joint Managing Director andWhole-time Director of the Company are in receipt of remuneration / commission fromSubsidiary Companies of the Company.

e. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern and Company’s operation in future.


Certain statements in the "Director’s Report & Management Discussion andAnalysis" describing the Company’s views about the Industry expectations/predictions objectives etc. may be forward looking within the meaning of applicable lawsand regulations. Actual results may differ materially from those expressed in theStatement. Company’s operations may inter-alia affect with the supply and demandstipulations input prices and their availability changes in Government regulationstaxes exchange fluctuations and other factors such as Industrial relations and economicdevelopments etc. Investors should bear the above in mind.


Your Company has been able to operate efficiently because of the culture improvement inall functions and areas as well as the efficient utilization of the Company’sresources for sustainable and growth.

The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Board ofDirectors also wish to place on record its deep sense of appreciation for the dedicatedand committed services by the Company’s executives staff and workers.

Last but not the least your Directors wish to place on record their warm appreciationto you for your continuous support and encouragement.

For and on behalf of the Board of Directors


Chairman & Managing Director

DIN: 00089984

Place : Mumbai

Dated : 14th May 2021