To the Members
The Directors have pleasure in presenting the 104th Report on the operations andresults of your Company for the Financial Year ended 31st March 2021 together with theAudited Financial Statements Auditor's Reports and the Comments of Comptroller &Auditor General of India on the Accounts of the Company and other statements/ reportsattached thereto.
FINANCIAL SUMMARY & HIGHLIGHTS
(Rs. in Lakhs)
| || |
STANDALONE FINANCIAL RESULTS
CONSOLIDATED FINANCIAL RESULTS*
|Over all Financial Results ||Year ended 31st 2021 ||March 2020 ||Year ended 31st 2021 ||March 2020 |
|Surplus for the year before deduction of Finance ||20753 ||28234 ||18972 ||24004 |
|Charges Depreciation and Tax || || || || |
|Deduct there from: || || || || |
|i. Finance Charges and Depreciation ||5088 ||4989 ||6694 ||6660 |
|ii. Provision for Taxation ||4020 ||5527 ||4019 ||5527 |
|Profit after Tax (PAT) ||11645 ||17717 ||8259 ||11817 |
|Add: Transfer from Profit & Loss Account ||82349 ||79750 ||105832 ||100836 |
|Total amount available for Appropriation ||93994 ||97467 ||114092 ||112653 |
|Appropriations: || || || || |
|Interim Dividends ||0 ||0 ||0 ||0 |
|Dividend @ Rs 7.50 per equity share ||12825 ||12540 ||12825 ||12540 |
|(Previous Year Rs. 11.00 per equity share) || || || || |
|Corporate Tax on Dividend ||0 ||2578 ||0 ||2578 |
|Transfer to General Reserve ||0 ||0 ||0 ||0 |
|Other Adjustments ||0 ||0 ||-3610 ||-8298 |
|Minority interest / Foreign Exchange ||0 ||0 ||0 ||0 |
|Conversion Reserve etc. || || || || |
|Surplus carried forward to next year ||81168 ||82349 ||104876 ||105832 |
|Total of Appropriation ||93994 ||97467 ||114092 ||112653 |
* The Board's Report is based on standalone financial statements of the Company andthis information is given as an added information to the members.
Overview of the state of the Company's Affairs
The Company recorded net turnover of Rs.159276.79 Lakhs during Financial Year 2020-21as against Rs.161216.14 Lakhs in 2019-20 which is a decrease of approximately 1.20% overlast year.
The Company recorded a Profit Before Tax of Rs.15664.97 Lakhs in Financial Year 2020-21as against Rs.23244.21 Lakhs in 2019-20. The decrease is being attributable to the COVIDpandemic and the performance of SBUs Travel and Vacations which are effected due to thesame.
Transfer to Reserves
The Reserve and Surplus of your Company decreased to Rs.113672.40 Lakhs as on 31stMarch 2021 as compared to Rs.114866.36 Lakhs as on 31st March 2020. During the FinancialYear 2020-21 no amount has been transferred to General Reserve.
The paid-up Equity share capital of the Company as on 31st March 2021 stood atRs.1710038460 consisting of 171003846 Equity Shares of Rs.10/- each fully paid-up.
The Company has not issued any share with differential voting rights nor has grantedany stock option or sweat equity share.
A dividend of Rs. 6.00/- (Rupees Six only) per fully paid-up Equity Share on theentire paid-up equity share capital of the Company has been recommended by the Board ofDirectors for Financial Year 2020-21 for declaration by the Members at the ensuing 104thAnnual General Meeting (AGM) to be held on 28th September 2021. The dividend ifdeclared will be paid within statutory time limit of 30 days from the date of suchdeclaration either by way of warrant demand draft or electronic mode to thoseShareholders who would be holding shares of the Company as on the cut-off date i.e. 21stSeptember 2021 (End of Day). In respect of shares held electronically dividend will bepaid to the beneficial owners as on the cut-off date i.e. 21st September 2021 (End ofDay) as per details to be furnished by their respective Depositories i.e. either CentralDepository Services (India) Ltd. or National Securities Depository Ltd. The dividend to bepaid shall be subject to Tax Deducted at Source and other applicable provisions of theIncome Tax Act 1961. The trend of dividend declared by the Company in the past andrecommended for FY 2020-21 is depicted below:
DIVIDEND DISTRIBUTION POLICY
Your Company had formulated a Dividend Distribution Policy in the year 2016. Theproposed Dividend Policy has been uploaded on the Company's website at the link:https://www.balmerlawrie.com/adminls/dl_u/ DIVIDEND_DISTRIBUTION_POLICY.pdf
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANYOCCURRED BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT
The spread of COVID-19 has severely affected the businesses around the globe. In manycountries including India there has been severe disruption to regular operations due tolock-downs disruptions in transportations supply chain travel bans quarantines socialdistancing and other emergency measures. Some of the services of the company have beenidentified as Essential Services and have been permitted to be allowed during the lockdownphases. The Company is also running its manufacturing facilities and is providing goodsand services to its Customers. The Company has made detailed assessment of its liquidityposition for the next few months and of the recoverability and carrying values of itsassets comprising Property Plant and Equipment Intangible Assets Trade ReceivablesInventories and Investments as at the Balance Sheet date and based on the internal andexternal information upto the date of approval of these financial statements includingcredit reports and economic forecasts has concluded that no material adjustments arerequired to be made in the financial results.
The management believes that it has considered all the possible impact of known eventsarising from Covid-19 global health pandemic in the preparation of financial results.However the impact assessment of COVID-19 is a continuing process given the uncertaintiesassociated with its nature extent and duration. The management shall continue to monitorany material changes to future economic conditions on a continuing basis.
The Hon'ble National Company Law Tribunal had passed Order dated 9th April 2021 in thecase No. IA (IB) 1238/KB/2020 in CP(IB) No. 1444/KB/2018 Syndicate Bank Vs.Transafe Services Limited thereby approving the Resolution plan submitted by M/S OMLogistics Limited being the Resolution Applicant (RA) in the case of Transafe ServicesLimited (TSL). The approved resolution plan also stated about capital reduction of theexisting share capital (both Equity and Preference) of TSL. It stated that the entireExisting Equity Share Capital of TSL (the Corporate Debtor) shall stand cancelledextinguished and annulled to the extent of 22723991 (99.99997%) shares on or before thePlan Effective Date and be regarded as reduction of share capital. The residual 0.00003%share is directed to be transferred to RA.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report as per the provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (SEBI LODR) is attachedseparately as Annexure- 1'.
CONSOLIDATED FINANCIAL STATEMENTS
The Financial Statements and Results of your Company have been duly consolidated withits Subsidiaries and Associates pursuant to applicable provisions of the Companies Act2013 & allied Rules the SEBI LODR and Indian Accounting Standards (Ind-AS).
Further in line with first proviso to Section 129(3) of the Companies Act 2013 readwith the Rules thereon Consolidated Financial Statements prepared by your Companyincludes a separate Statement in Form AOC-1' containing the salient features of theFinancial Statement of your Company's Subsidiaries Associates and Joint Ventures whichforms part of the Annual Report.
REPORT ON SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES AND THEIR CONTRIBUTIONTO THE OVERALL PERFOMANCE IN THE COMPANY
During the Financial Year 2018-19 the Company had revised the policy for determiningmaterial subsidiaries in terms of the amended SEBI Listing Regulations w.e.f. 1st April2019. The policy may be accessed on the Company's website at the link:https://www.balmerlawrie.com/adminls/dl_u/Policy_on_Determining_Material_Subsidiary-BL.pdf As per the aforesaid policy none of thesubsidiaries appear to be material subsidiary of your Company.
FINANCIAL STATEMENTS OF SUBSIDIARY COMPANIES
In line with the provisions of Section 136 of the Companies Act 2013 your Company hasplaced separate audited accounts of each of its subsidiaries on its website -www.balmerlawrie.com. Members shall be provided separate financial statement of each ofthe Subsidiary Companies as per requisition made by them in writing.
A brief write up about the Subsidiaries Associates and Joint Ventures Companies ofyour Company inter-alia reporting about their respective performance financial positionand other significant events is presented hereunder:
BALMER LAWRIE (UK) LTD. [BLUK]
Balmer Lawrie (UK) Ltd. (BLUK') is a 100% subsidiary of your Company incorporatedin the United Kingdom. The subsidiary had previously been engaged in the business ofLeasing & Hiring of Marine Freight Containers as also in Tea Warehousing Blending& Packaging.
After exiting these businesses BLUK has been utilizing the proceeds to fund otherbusiness opportunities. BLUK had invested approximately US$ 2.01 million equivalent toIndonesian Rupiah 21.0 billion in PT. Balmer Lawrie Indonesia (PTBLI) having itsregistered office at Jakarta Indonesia which represents 50% of the paid-up equityshare capital of the joint venture company. Balance 50% of the paid-up share capital ofPTBLI is subscribed by PT. Imani Wicaksana of Indonesia. PTBLI is engaged in themanufacture and marketing of greases and other lubricants in Indonesia. The operations atthe plant have now stabilized and the JV is actively trying to get a foothold in thechallenging Indonesian lube market.
During the year 2018-19 Balmer Lawrie had initiated steps for closing of operations ofBLUK and is in the process of getting necessary statutory clearances for closure from theauthorities in the United Kingdom. As a part of this process the shares of PTBLI held byBLUK were transferred to Balmer Lawrie during the year 2018-19. It is expected that theprocess of voluntary winding of BLUK would be completed during the Financial year 2021-22.
VISAKHAPATNAM PORT LOGISTICS PARK LIMITED [VPLPL]
Balmer Lawrie & Co. Ltd. (BL') was looking for an expansion in the area oflogistics operations and in the year 2013-14 was able to crystallise a deal withVisakhapatnam Port Trust (VPT) where VPT had agreed to provide 53 acres of its land atVisakhapatnam on a long term 30 years lease basis for development of a modern logisticssolutions hub under one roof which is commonly termed as "Multimodal LogisticsHub". BL and VPT then formed a joint venture Company in the name of"Visakhapatnam Port Logistics Park Limited" (VPLPL) which got incorporated on24th July 2014 under the Companies Act 2013. In the equity capital of VPLPL BL and VPTcontributed in the ratio of 60:40 where BL paid its part of the equity contribution incash whereas VPT paid its part of equity contribution in the form other than cash whichis equivalent to upfront lease rentals of 30 years lease for its 53 acres of land. Themain objective of this JVC is to build and operate a Multimodal Logistics Hub (MMLH)facility comprising mechanised warehouses specialised/temperature controlled storagesolutions facilities for mechanised material handling and intermodal transfer betweencontainer terminals bulk/break bulk cargo terminals. This hub provides facility tohandle both bonded and non-bonded cargo coupled with offering of value added services suchas customs clearance sorting/ grading/aggregation/disaggregation etc. to handle freight.The unit is also having rail connectivity of 1.30 KM length where 4 rakes can be handledin a day. VPLPL has engaged a core and structured sales and operations team for businessdevelopment and efficient execution. The mechanised warehouse facility of the JVC coveringaround 2.5 Acres had an average utilization of 67% during the year under review i.e.financial year 2020-21. This facility is witnessing a good business opportunity and theJVC is expecting an average utilization of 90% during the current financial year. The JVCalso offers temperature controlled facility equipped with frozen & chilled chamberswith a capacity of handling 3780 pallets which contributed 25% of the overall revenue ofthe JVC.
The JVC during the year under review experienced a significant increase in demand ofits open yard due to its location advantage convenience of handling cargos and modernoperational solution. The customers for this particular business ranges from privateentities to PSUs. During the year under review this facility has contributed around 45%of the total revenue of the JVC. The railway siding facility was able to cater to thegrowing demands of steel and aluminium exports from Visakhapatnam Port and 129 rakescarrying this cargo were handled at the facility during the year. It is pertinent tomention that both the JV partners complement each other in attracting business for theJVC.
VPLPL despite having CFS/ICD infrastructure is not able to handle EXIM cargo due tonon-receipt of CFS/ ICD license which they had applied in March 2017. The Ministry ofFinance vide its Circular no. 50/2020 dated 5th November 2020 has brought out a newpolicy and procedures for setting up of the new CFS/ICD/ AFS. VPLPL took the advantage ofthe relaxations granted under the said policy and applied for its CFS license for thesecond time in May 2021.
During the year under review i.e. 2020-21 VPLPL was able to generate total revenueof Rs. 9.34 crores as against Rs. 4.71 crore earned in the previous year 2019-20. Howeverdue to depreciation and interest on borrowing VPLPL ended up the year 2020-21 with aloss of Rs. 12.59 crore which is slightly lower compared to the previous year's loss ofRs. 16.04 crore.
REPORT ON JOINT VENTURES BALMER LAWRIE (UAE) LLC (BLUAE)
Despite severe challenges in 2020 due to the outbreak of Corona Virus InfectionsLockdowns/ restricted working hours difficult customer reachability FY 2020 Balmer Lawrie(UAE) LLC posted one more year of brilliant performance in terms of topline and as wellbottom line too.
The company achieved highest ever Sales Volumes in the five of its product segments andfor rest other products also the Sales Volumes were extremely satisfactory.
BLUAE continued to maintain Customer-Centric Focus and acted as a one-stop-shop forIndustrial Packaging Products. This helped the company to maintain and exceed customerexpectations in terms of customer service and reliability.
The company took advantage during lockdowns skill improvement trainings wereconducted resulted in efficiency gains in the plant further continuous engagement ofemployees and management resulted in better performance in the crisis.
In continuation to the "Cost Leadership Initiatives'' substantial processimprovements/alternate raw materials usage helped the company to improve thecompetitiveness in the marketplace thereby retaining and improvement of market share.
The process of modernization resulted in a higher volume of sales. Fuller benefits areexpected to accrue in 2021 subject to completion of all projects and ease of travelrestrictions.
To expand the Customer/Market Share the company has embarked on foreign markets.Though large numbers of products have been exported the travel restrictions and portclosures/lockdowns acted as deterrent better results are expected to take place in 2021.
Despite local stiff competition and also global competition the company could hold theposition of leadership in the "Rigid Industrial Packaging" market in the region.Pressure on margins continues to remain due to domestic and foreign competition. Despitethe above factors Balmer Lawrie (UAE) LLC could retain and improve the marketshare/volumes and have posted excellent Financial Results for the year (FY 2020) underreview.
Further depending on easing out of restrictions/ removal of travel embargo etc. itwould be extremely uphill task to maintain the similar momentum in 2021.
BALMER LAWRIEVAN LEER LTD. [BLVL]
Balmer Lawrie-Van Leer Ltd. (BLVL) had experienced the wrath of slow down and loss ofbusiness.
Their factories in Mumbai were under lock down till June 2020 but other factories atDehradun Bengaluru & Chennai were operational with limited capacity. With the openingof the economy post June 2020 came the spurt in pent-up demand. BLVL saw a rebound inboth Revenue & PBT in the last 9 months and was partly able to regain the lostbusiness. The PBT of BLVL for the FY 2020-21 stood at Rs. 32.42 Crores as against Rs.38.41 Crores in the previous year.
The Gross Revenue dropped slightly from Rs. 444 Crores to Rs. 428 Crores due to limitedoperations. The Steel Drum closure unit of BLVL at Turbhe and at Bengaluru have been ableto maintain the last year's Turnover with a marginal increase. The Plastic Division atTurbhe Dehradun & Chennai saw a shortfall in turnover compared to last year. HoweverBLVL Plastic Drum division witnessed an increased Value Addition. The proposed PlasticDrum Factory at Dahej has started commercial production since May 2021 in Large BlowMoulding and liners and expected to start commercial production of other products in aphased manner.
AVI-OIL INDIA PRIVATE LTD. [AVI-OIL]
For the year 2020-2021 AVI-OIL has achieved sales volume of 791 KL of lubricantsblended 11 MT of greases reprocessed and packed and 359 MT of the ester base stocksmanufactured.
During the financial year 2020-2021 the Company achieved the net sales of Rs. 4079Lakh as compared to the previous year net sales of Rs. 4697 Lakh. The Profit before Tax(PBT) of AVI-OIL for the year 2020-2021 is Rs. 422 Lakh as compared to PBT of Rs. 725 Lakhin the previous year. The decrease is mainly due to lower sales increase in employee costand other expenses.
The Profit before Depreciation Interest and Tax (PBDIT) for the year 2020-2021 is Rs.785 Lakh as compared to PBDIT of Rs. 1068 Lakh in the previous year.
TRANSAFE SERVICES LTD. [TSL]
TSL is a joint venture of Balmer Lawrie & Co. Ltd. (BL') and Balmer Lawrie -Van Leer Ltd. (BLVL') with each holding 50% shares. TSL was facing rough weatherssince 2009-10 and during the Financial Year 2012-13 its accumulated losses surpassed itsnet worth and consequently in 2013 a suo-moto application for revival was made beforeerstwhile "Board for Industrial & Financial Reconstruction" (BIFR')under the repealed Sick Industrial Companies (special provisions) Act 1985 (SICA').Due to the emergence of a new law - "Insolvency and Bankruptcy Code 2016(IBC')" the aforesaid pending application before BIFR became inactive sinceDecember 2016. Thereafter in the year 2018 one of the bankers of TSL filed aninsolvency application before the Hon'ble National Company Law Tribunal (NCLT')under IBC. This insolvency application after few hearings before NCLT got admitted on 21stNovember 2019. Consequently upon such admission the powers of the Board of Directors ofTSL got suspended and the affairs & running of TSL were entrusted to an InsolvencyResolution Professional (IRP) appointed by the NCLT. On and from 21st November 2019since the IRP has taken charge/control of TSL the financial statement of TSL are notconsolidated with BL in the Consolidated Financial Statements. The NCLT after severalhearings had passed Order dated 9th April 2021 thereby approving the Resolution plansubmitted by M/S OM Logistics Limited being the Resolution Applicant (RA). The approvedresolution plan also stated about capital reduction of the existing share capital (bothEquity and Preference) of TSL. It stated that the entire Existing Equity Share Capital ofTSL (the Corporate Debtor) shall stand cancelled extinguished and annulled to the extentof 22723991 (99.99997%) shares on or before the Plan Effective Date and be regarded asreduction of share capital. The residual 0.00003% share is directed to be transferred toRA. This implies that the shareholding of BL in TSL stands cancelled extinguished andannulled from the Plan effective date as per the said order of NCLT.
PT BALMER LAWRIE INDONESIA [PTBLI]
PT Balmer Lawrie Indonesia (PTBLI) is a 50:50 joint venture company between "PT.Imani Wicaksana" Indonesia and "Balmer Lawrie & Co. Ltd." India. TheCompany was formed in 2010. The business of the joint venture is manufacture and sale ofgrease and lubricants in domestic market and can be broadly categorized into:
- Processing Business
- Direct Sales
- Institutional Sales
During Financial Year 2020-2021 PTBLI achieved a Turnover of Rs. 4611 Lakhs and NetProfit of Rs. 206 Lakhs against a Turnover of Rs. 2316 Lakhs and Net Loss of Rs.320.81 Lakhs during previous Financial Year.
CESSATION/CHANGE IN JOINT VENTURES/ SUBSIDIARIES/ ASSOCIATE COMPANIES DURING THE YEAR
During the year 2018-19 Balmer Lawrie had initiated steps for closing of operations ofBLUK and is in the process of getting necessary statutory clearances for closure shortlyfrom the authorities in the United Kingdom. It may be expected that the process ofvoluntary winding of the company would be completed during the Financial Year 2021-22.
MEMORANDUM OF UNDERSTANDING (MOU)
Every year your Company signs an MOU with the Government of India Ministry ofPetroleum and Natural Gas based on guidelines issued by the Department of PublicEnterprises (DPE). The MOU targets include revenue from operations operating profit toRevenue PAT/Net Worth return on investment in JV's capital expenditure inventorymanagement capacity utilization and human resource management etc. Periodic review onachievement of MOU was carried out throughout the year. MOU evaluation for the FinancialYear 2019-20 is awaited.
HUMAN RESOURCE MANAGEMENT (HRM)
The organization believes that its success depends on the alignment & performanceof its people. In order to create value for the Organization and based on the long termplan and current realities the following domains have been the focus areas of HumanResource Management in the FY 2020-21:-
- To ensure the organization has the right people in the right job at the right time.
- Enhancing employee productivity to reach the best in class levels and improveprofitability by striving for competitive wage cost.
- Renewed focus on enhancing employee engagement and employee experience.
- Continue to build employee capability upgrading leadership and manage talent &employee performance across all levels of the workforce.
(a) Talent Acquisition
In today's intensely dynamic markets the Company has successfully inducted 44 (FortyFour) Executives and 7 (Seven) Officers (Non-Unionized Supervisors) during the year toreinforce the Company's performance and bolster the Company's capabilities in all businessareas.
(b) Learning and Development
The Company aligns its learning & development practices and solutions in line withthe organizational growth or productivity. Our aim has been to continuously invest inenhancing the professional skills and competencies of our employees. With the objective ofenhancing the functional and leadership competencies extensive training programs foremployees in line with the business requirement of the Company both in the areas ofgeneral management and specialist skill development were planned and executed. The Companyalso administered e-learning content for its employees during the year. In all 1813Man-days were achieved including in-house and external programmes including workshopsconferences seminars virtual training programmes for all categories of employees duringthe year.
(c) Managing Performance
Based on the Competency Framework developed for all Executive grades the Company hasimplemented a Competency Linked Performance Appraisal System for all Executives. With aview to ensure timely completion of Performance Management Appraisals the process hasbeen e-enabled for Executives upto grade E-8. Our Company has maintained 100 % onlinesubmission of ACR/APAR in respect of all Executives (E0 and above) along with complianceof prescribed timelines w.r.t writing of ACR/APAR during FY 2020-21.
(d) Employee Engagement and Welfare
An effective work culture has been established in the organization which encouragesparticipation and involvement of employees in activities beyond work. Towards furtheringthis during the year the 155th Foundation Day was celebrated in all units andestablishments across the country. The employees participated in large numbers and madethe event a memorable occasion.
Welfare & representation of SCs STs OBCs PwBDs EWS
During the year in the Executive & Officers [NUS] cadre 9 (nine) employees in theSC category 12 (twelve) employees in the OBC category 1 (one) employee in the STcategory 6 (six) women employees and 1 (one) employee from the EWS were recruited. Theactual number of employees belonging to special categories Group-wise as on 31st March2021 is given below:-
|Group ||Regular Manpower as on 31.03.2021 ||SC ||ST ||OBC [*] ||PH ||Women ||EWS ||Minori- ties |
|A ||504 ||56 ||7 ||88 ||5 ||62 ||1 ||31 |
|B ||218 ||34 ||4 ||57 ||4 ||25 ||2 ||18 |
|C ||53 ||3 ||0 ||16 ||1 ||10 ||0 ||2 |
|D [including D1] ||214 ||24 ||4 ||57 ||6 ||4 ||0 ||36 |
|Total ||989 ||117 ||15 ||218 ||16 ||101 ||3 ||87 |
[*] On and from 08th September 1993 onwards
Implementation of The Persons with Disabilities [Equal Opportunities Protection ofRight and Full Participation] Act 1995 and The Rights of Persons with Disabilities Act2016
In compliance with the above Acts the Company has implemented reservation rostersincluding 4% reservation for persons with benchmark disabilities. During the FY theCompany has also developed and implemented Equal Opportunity Policy' in accordancewith the provisions of the Rights of People with Disabilities Act 2016 and Rights ofPersons with Disabilities Rules 2017.
Management believes in a process of open & transparent consultation with thecollectives. Employees are represented in various Trusts formed by the Company toadminister various employee benefit schemes. Plant level committees are in place todiscuss and settle productivity and work place related matters. Consultative Forums havebeen established to resolve disputes / differences. The employee relations continued to begenerally cordial at all Units / Locations of the Company during the year.
Implementation of Official Language
To ensure implementation of Official Language policy of the Government of India ourCompany has taken several steps to promote usage of Hindi in official work. Variousactivities like 35 workshops were organized during the year in which 318 employees weretrained on usage of Hindi in Official work. Hindi Pakhwada was celebrated at all locationsof the Company during the month of September 2020.
We have also trained 44 employees in Hindi Prabodh Praveen and Pragya courses. Issueof Balmer Lawrie Organizational Gazette (BLOG) for October 2020 was released completelyin Hindi. Similarly Balmer Lawrie online monthly (BLOOM) Bulletin also releasedbilingually. Implementation of the Official Language Policy is top driven in our companyand used Hindi in all our activities of CSR Company's Foundation Day Town hall meetingsWorld Environment Day Safety Week Vigilance Awareness Week International Womens DayQuami Ekta Week. As a helping literature to use Hindi in Official work file covers arenow being printed with bilingual designations / Daily routine notings.
Empowerment of Women
The Company provides a conducive ambience for employment of women. The percentage ofwomen employees is on the rise with new recruitments. The present strength of womenemployees is 10.2% despite the fact that a large chunk of our workforce constitutes ofshop floor workers. The company has created an atmosphere conducive for women employees tojoin and build a career in this organization. The Company also organized various programsduring its Women's Day Celebration for Women Personnel across Regions.
Welfare of the Weaker Sections
The Company policy does not permit employment of any person below the age of 18directly or through contractor in any of its businesses. To ensure this the age of allcandidates for employment is verified at the time of recruitment and recruitment rules banemployment of persons below 18 years. It also does not buy goods/products from agenciesthat use child labour.
The Company does not practice any form of discrimination or bias in matters related tohiring of employees their career planning training and development promotiontransfers or on remuneration and perquisites. All sections of employees including womenare given equal opportunities and the Human Resource Policy is to advance the cause ofmeritocracy and foster development of employees including learning and growth.
The Company does not practice any discrimination in matters relating to recruitmentcompensation promotion training on the basis of religion caste region politicalaffiliation or sex excepting positive discrimination in hiring of employees to giveeffect to constitutional guarantees for socially backward/ underprivileged groups like SC/ ST /OBC / Minorities / EWS/ Persons with benchmark disabilities.
In all recruitments where there are candidates from SC / ST / OBC communities theSelection Committee has a member from the reserved community to ensure that the interestof these communities is safeguarded.
BUSINESS RESPONSIBILITY REPORT
Business Responsibility Report of the Company as per Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 for theFinancial Year ended 31st March 2021 is attached as Annexure 2'. OCCUPATIONALHEALTH & SAFETY
Employee Health & Safety
Your Company accords high priority to Employee Health & Safety. In pursuance ofthis your Company has established an integrated Health & Safety Management Systemacross the organization. Your Company has published an HSE Manual which is being used as areference book in plants and other establishments of your Company. Your Company carriesout HSE audits for all its Manufacturing Units Container Freight Stations (CFS) andTemperature Controlled Warehouses (TCW) as per the approved HSE audit protocol. YourCompany has also introduced an HSE MIS system for all Manufacturing CFS & TCW units.Every plant / CFS / TCW unit submits a monthly HSE MIS to Corporate Office enabling it totake corrective steps. Major plants / units of your Company are OHSAS 18001 certified. AllOccupational Health & Safety Standards are adhered to as per the Factories Act 1948.Your Company has taken adequate protection for its employees to combat the COVID-19pandemic in line with the directives issued by MHA from time to time. Major initiatives /activities undertaken in this domain in Financial Year 2020-21 are as follows:
HSE Audits were carried out in manufacturing units/establishment of your Company duringthe year and recommendations thereof implemented.
HSE awareness training was conducted for permanent employees and contract workers.
The 50th National Safety Week was observed from 4th to 10th March 2021 in all units /establishments across locations. The week commenced on 4th March 2021 which was observedas National Safety Day with the administering of the safety pledge and reading out ofmessage of Shri Adika Ratna Sekhar Chairman & Managing Director - (Additional Charge)and Director (Human Resource
& Corporate Affairs) and Director (Manufacturing
Businesses) - (Additional Charge). In line with the theme various programs wereorganized over the week. The programs included extempore quiz skit spot the hazardcontest mock drills safety slogan & essay writing competitions.
Environmental Protection and Sustainability:
Being fully committed towards the protection and conservation of the environment yourCompany has taken various initiatives to minimize the pollution load of operations.Treatment & disposal of effluents conform to the statutory requirements. Air emissionsnorms also strictly adhered to the norms laid down in the Environment Protection Act1986. Disposal of hazardous waste is done strictly as per Hazardous Waste and Other WasteRules 2016. All Plants and major establishments of the Company are certified toenvironment standards ISO 14001. The Company has in place a comprehensive Long TermIntegrated Sustainability Plan which lays down the sustainability policy programframework governance structure communication etc.
Some of the other initiatives / activities taken up by your Company in this domain in2020-21 include:
The Industrial Packaging (IP) plant at Asaoti plant has installed solvent recoverysystem. The capacity of the solvent recovery system is 100 litres and it recovers up to85% paint thinner from the mixture of paint and thinner. This has led to more efficientuse of the solvent with minimal impact on environment due to solvent discharge. In IP -Chittoor rainwater harvesting is done. Also R.O. waste water is used for gardeningpurposes. In IP - Manali three-phase invertor type welding controller is installed and ithas resulted in reduced electricity required in the process.
Container Freight Station (CFS) - Kolkata organized tree plantation drives forreduction of carbon footprint. Also occupancy sensors are installed in the conferenceroom to reduce electricity consumption. Motion sensing LED lights were installed inCFS-Chennai to reduce electricity consumption. In CFS - Mumbai new sludge pit wasconstructed to contain the sludge and prevent accidental spillage.
Chemicals - Manali closed earlier old solar evaporation ponds for effluent treatmentsystem and started state of art Zero Liquid Discharge (ZLD) plant. This has given somerelief in terms of handling the effluents but resulted in higher operating cost and highergeneration of solid waste. The R&D team after due study improved the reactionefficiency from 55% to 85% by modifying kettle type reaction system to series reactionsystem. Since reaction efficiency increased unreacted gas emanating from the reactionreduced resulting in lesser alkali consumption and lesser effluent generation. Again theR&D HSE and Production Teams worked further and developed a method to eradicate theeffluent generation completely from the sulfochlorination process. With the newlydeveloped process now there is no effluent generation from the primary reaction. Earlierfor producing one sulfochlorinated product the other process used to generate the twotypes of effluents. One was acidic and the other alkaline. Now the acidic effluent isconverted to usable product cleaning chemicals and the alkaline effluent is converted tosaleable leather chemical product. Another advantage of this new process is that theliquid product generated from this reaction is feed for another plant - Syntan plantresulting in overall higher plant capacity utilization. Presently scrubbers and effluenthandling equipment are being used for making products. We can say that this is a case ofgenerating wealth out of waste as hazardous waste produced from the process has becomealmost negligible.
CFS - Kolkata replaced conventional HPSV floodlights of all seven High Mast LightingTowers with LED lights and installed energy efficient air conditioners. G&L - ManaliIP - Navi Mumbai IP - Chittoor IP Manali and CFS-Mumbai installed LED lightsreplacing conventional light fittings.
G&L - Silvassa installed oil water separator unit (6Kl / Hr). They have also becomea zero waste water discharge plant.
IP - Manali installed 500 ltr / day RO plant for its degreasing unit thus reducingusage of fresh water. They are also using poly bag for drum packing instead of corrugatedpaper which is more environment friendly.
IP - Asaoti installed 3 phase auto welding machine replacing the old 2 phase weldingmachine which has helped in reducing power consumption from 400A to 72A.
IP - Vadodara installed VOC material extraction system at paint booth thus reducingenvironmental pollution.
Hazardous gas leakage system was installed at Chemicals - Manali.
IP - Manali installed 500 ltr / day RO plant for its degreasing unit thus reducingusage of fresh water.
G&L - Manali installed oil float sensors and LDO float sensors in the storage tankto prevent spillage of oil and subsequent land contamination.
In IP - Silvassa refurbishment of main line preheater was done for better fuelefficiency.
The Company has continued its efforts at technological up-gradations in itsmanufacturing processes to ensure that adverse impact of operations in the environment areminimized.
Our R&D team continuously works to identify raw materials processes andtechnologies which will have minimum impact on the environment. The Application ResearchLaboratory of the Company has made significant progress in developing a number ofbiodegradable lubricants. Continuous trainings are being imparted to our workforce on thelatest development in the lubricant industry.
Saplings were planted at all units on the occasion of World Environment Day 2020.Online quiz and essay competition on Environment was organised out for all employees tocreate awareness.
CFS - Kolkata CFS - Navi Mumbai CFS - Chennai TCW - Rai TCW - Patalganga G&L -Kolkata G&L - Manali IP - Asaoti IP - Vadodara IP - Chittoor IP - Navi Mumbai andother establishments across India planted large number of trees during the last financialyear (2020-21). This creation of green cover aims to reduce the overall carbon footprint.
Rainwater harvesting is done at CFS - Chennai and IP - Chittoor.
The Company has till date installed solar plants with a total capacity of 626 KWp inseven different sites at Asaoti Navi Mumbai Chennai Patalganga Rai and Silvassa (twolocations). Out of this in the FY 2020-21 50 KWp solar power plant has been commissionedat IP - Silvassa and another 50 KWp solar power plant has been commissioned at G&L -Silvassa. This helps Balmer Lawrie to offset approximately 950 tons of carbon dioxide peryear from its manufacturing and cold chain operations.
Single use plastic is banned in all plants of Balmer Lawrie.
COMMUNICATIONS & BRANDING INITIATIVES
The various internal communication and branding initiatives driven during the year2020-21 to create employee bonding and enhance the process of information sharing inBalmer Lawrie (BL) are as follows:
Regular publication of the Daily Media Update (a news report for the Ministry and TopManagement team covering news on BL news from the Oil & Gas sector and initiativesof the government).
Regular publication of the Weekly Media Update (a news report for employees coveringnews on BL news related to GOI and PSEs and news from the verticals that we do businessin); BL Online Monthly Bulletin (monthly newsletter) BL Organizational Gazette (thequarterly house magazine). These publications are available on the Company's intranet andwebsite. BL Online Monthly Bulletin is being published in Hindi from August 2019.
Internal events like celebration of Foundation Day etc. to enhance employee engagement.
Continuous communication on prevention of containment of COVID-19 at the workplace.
The external communication initiatives especially from a branding perspective andachievements are as follows:
Media Coverage: Corporate Reports in business magazines / newspapers / television &online media and coverage of key organization events and CSR initiatives etc.
Branding in virtual Exhibitions and Corporate events highlighting BL as market leaderin the various businesses it operates.
Regular updates related to company events initiatives of Hon'ble PM and Ministry ofPetroleum and Natural Gas are posted on the BL Facebook LinkedIn and Twitter pages.
Branding of Swachh Bharat Abhiyan and other similar initiatives.
Brochure for AMTZ Central Warehouse published.
Cold Chain Logistics brand name contest organized. SBU named as Cold Chain with newlogo LOGICOLD Cold Chain Solutions' in short LOGICOLD'.
Branding for SBU: Chemicals new logo design in progress.
Further Corporate Communications drove the process of empanelment of Agencies in theareas of Creative and Advertising / Digital Marketing / PR etc. and comprehensive brandingplans for the year 2021-22 are in the process of implementation in SBUs: Greases &Lubricants and Travel & Vacations by their respective marketing teams.
PROGRESS ON PRINCIPLES UNDER GLOBAL COMPACT'
Your Company is a founder member of the UN Global Compact and it remains committed tofurther the principles enumerated under the Global Compact programme. The details ofvarious initiatives taken in this regard can be found in the Communication ofProgress (CoP)' and the Message of Continued Support to Global Compact' publishedby Corporate Communications and uploaded on the website of the Company(www.balmerlawrie.com). Your Company's C&MD in his 'Message of Continued Support toGlobal Compact' said that as a diverse organisation with presence in both themanufacturing and services sectors coping with the challenges posed by the pandemic waseven more difficult for Balmer Lawrie. As a Company we have been resilient and we havebeen putting in that extra effort and going that extra mile to ensure safety of ouremployees and business continuity at every juncture. The Communication of Progress (CoP)report for the year 2020-21 is a summary of the Company's efforts and achievements infurthering the Company's sustainability objectives which are seamlessly integrated withthe overall business goals. Balmer Lawrie focused on the triple bottomline and tookforward various activities as part of the Start-up Fund CSR and HSE initiatives.Encouraged by the success in nurturing innovative ideas and ensuring that the ideas getstranslated into successful businesses Round 2 of the Startup Fund program was launched.An MOU was signed between Balmer Lawrie and IIM Calcutta Innovation Park for takingforward the Round 2 Startup Fund Program on 24th February 2021. During the year somesignificant CSR and HSE initiatives were undertaken across the country focusing on theprevention of COVID-19. The Business Responsibility Report [BRR] and Sustainability Reportwere successfully published for one more year. The Industrial Packaging plant at Asaotiparticipated in the India Green Manufacturing Challenge organised by InternationalResearch Institute for Manufacturing in March 2021 and Balmer Lawrie was categorised as aSilver standard company for its green initiatives. The Temperature Controlled Warehouse(TCW) at Rai Haryana won the Cold Chain Award for outstanding performance in the category"Best Practices in Cold Storage"givenawaybyConfederationofIndianIndustry inFebruary 2021. TCW Hyderabad contributed to the world's largest COVID-19 vaccinationdrive as the sole storage and logistics partner of Bharat Biotech for Covaxin. Weappreciate the fact that in these tough times special focus on our sustainability roadmapis needed to not only safeguard the interests of all our stakeholders but also continue tocreate long-term value for all of them.
DISCLOSURE ON IMPLEMENTATION OF RIGHT TO INFORMATION ACT 2005
The Right to Information (RTI) Act 2005 was enacted by Government of India with effectfrom 12th October 2005 to promote openness transparency and accountability infunctioning of Government Department PSUs etc.
Balmer Lawrie has designated Senior Manager (Legal) as Central Public InformationOfficer and Company Secretary as First Appellate Authority under the RTI Act 2005.Detailed information as per the requirement of RTI Act 2005 has been hosted in yourCompany's Web Portal https://www.balmerlawrie.com/static/rti and the same is updated fromtime to time.
Information sought under RTI Act 2005 is being provided within the prescribedtime-frame and details of which for Financial Year 2020-21 are shown in the table below: -
| ||Opening Balance as on 01.04.2020 ||Received during the Year (including cases transferred to other Public Authority) ||No. of cases transferred to other Public Authorities ||Decisions where request/ appeals rejected ||Decisions where requests/ appeals accepted ||Closing balance as on 31.03.2021 |
|(a) ||(b) ||(c) ||(d) ||(e) ||(f) ||(g) |
|Requests ||27 ||59 ||3 ||0 ||57 ||26 |
|First Appeals ||0 ||7 ||0 ||5 ||1 ||1 |
(A) CONSERVATION OF ENERGY
(i) The steps taken or impact on conservation of energy:
Balmer Lawrie has always considered energy and natural resource conservation as a majorfocus area and has been consciously making efforts towards improving the energyperformance year on year. Energy conservation policy is formulated and deployed across allthe locations for Sustainable Development. Your Company has taken various measures to notonly reduce the consumption of energy through use of energy efficient equipment but hasalso focused on renewables as a source of alternative energy thereby reducing the load ofcarbon emission.
SBU: Industrial Packaging (IP) in IP-Manali three-phase invertor type weldingcontroller was installed and it has resulted in reduced electricity required in theprocess. IP - Asaoti installed 3 phase auto welding machine replacing the old 2 phasewelding machine which has helped in reducing power consumption from 400A to 72A.
SBU: Container Freight Station (CFS) in CFS-Kolkata installed occupancy sensors in theconference room to reduce electricity consumption. Motion sensing LED lights wereinstalled in CFS-Chennai to reduce electricity consumption.
SBU: Chemicals Manali closed earlier old solar evaporation ponds for effluenttreatment system and started state of art Zero Liquid Discharge (ZLD) plant. This hasgiven some relief in terms of handling the effluents but resulted in with higher operatingcost and higher generation of solid waste. The R&D team after due study improved thereaction efficiency from 55% to 85% by modifying kettle type reaction system to seriesreaction system. Since reaction efficiency increased unreacted gas emanating from thereaction reduced resulting in lesser alkali consumption and lesser effluent generation.Again the R&D HSE and Production Teams worked further and developed a method toeradicate the effluent generation completely from the sulfochlorination process. With thenewly developed process now there is no effluent generation from the primary5 reaction.Earlier1 for producing1 one sulfochlorinated product the process used to generate twotypes of effluents. One was acidic and the other is alkaline. Now the acidic effluent isconverted to usable product cleaning chemicals and the alkaline effluent is converted tosaleable leather chemical product. Another advantage of this new process is that theliquid product generated from this reaction is feed for another plant - Syntan plantresulting overall higher plant capacity utilization. Presently scrubbers and effluenthandling equipment are being used for making products. We can say that this is a case ofgenerating wealth out of waste as hazardous waste produced from the process has becomealmost negligible. CFS - Kolkata replaced conventional HPSV floodlights of all seven HighMast Lighting Towers with LED lights and installed energy efficient air conditioners.G&L - Manali IP - Navi Mumbai IP - Chittoor IP Manali and CFS-Mumbaiinstalled LED lights replacing conventional light fittings.
(ii) The steps taken by the Company for utilizing alternate sources of energy:
The Company has till date installed solar plants with a total capacity of 626 KWp inseven different sites at Asaoti Navi Mumbai Chennai Patalganga Rai and Silvassa (twolocations). Out of this in the FY 2020-21 50 KWp solar power plant has been commissionedat IP - Silvassa and another 50 KWp solar power plant has been commissioned at G&L -Silvassa. Cumulative generation of Solar Energy at your company in the current financialyear is 462502 Kwh. This helped your Company to offset approximately 950 tons of carbondioxide in current financial year from our manufacturing / cold chain operations.
(iii) The capital investment on energy conservation equipment:
Balmer Lawrie is focused on investing in modern technology for improving the specificenergy consumption. This investment is broadly done in the areas of LED lightingoccupancy sensors three phase welding machines aimed at reduction of the consumption orwastage of energy.
(B) TECHNOLOGY ABSORPTION
(i) The efforts made towards technology absorption
Technology absorption and innovation are at the core of any sustainable growth of anorganization. Your company has over the years adopted technologies which led to automationof processes increase in speed and efficiency of systems & processes reduced usageand wastage of energy faster analysis and decision making etc. thereby enabling thecompany to service its customers better. Apart from regular process & manufacturingrelated technology interventions the Research & Development centers of your companyare constantly monitoring the changing trends in technology and needs of customers andare developing cost effective products which can meet the growth aspirations of theCompany.
SBU: G&L's R&D efforts are directed towards the development of ImportSubstitute i.e. indigenous specialty greases for Defense Equipment under Make in Indiainitiative. Other key development works include cost-effective High-Performance Greases inElectric Locos of Indian Railways High-Performance Fire-Resistant Greases & Oilscatering to Steel Industries & Mines Superior performance grades of Rust PreventiveOils and High Performance of Greases and oils for Electric Vehicles.
Product Development center of SBU: Chemicals has focused and directed its efforts ondeveloping "Finishing Chemical Ranges" to increase its product basket in leatherchemicals. Series of Acrylic binders and Lacquers got developed. We have entered in toTextiles chemicals Cleaning Chemicals and commercialized a pigment binder Toilet cleanersuccessfully. We have developed a technology to utilize vent off sulphur dioxide insulphochlorination reaction to make Basic Chromium Sulphate (BCS) cost effectivelymatching the tanning and other related parameters. BCS occupies a major percentage inTanning the Leather. SBU: Industrial Packaging (IP) Upgradation of Seam welder Panel at IPNavi Mumbai Plant and Installation and commissioning of R.O. Plant at IP Chennai forimprovement of painting quality.
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution:
Your company is constantly exploring both incremental and fundamental innovations inall its business activities by exploiting both in-house and outside knowledge aimed atincreasing throughput minimizing conversion cost and developing new pipeline ofsustainable products which can help strengthen its position in the market place.
The expertise gained through assimilation of such knowledge is helping the businessesto develop high performance cost effective products matching the best in the industry.Continuous engagement with reputed OEMs & new products introduced in the market andusers have helped the Greases & Lubricants business in developing tailor madeproducts meeting the specific requirements of the OEMs. Chemicals business has been ableto bring down the free formaldehyde content of its syntans below the detectable limit bysuitable synthesis. Industrial Packaging business through its Operational Excellenceinitiatives has been able to improve yield reduce cost and increase the efficiency andquality.
(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) a. The details of technology imported: NA b.The year of import: NA c. Whether the technology been fully absorbed: NA d. If not fullyabsorbed areas where absorption has not taken place and the reasons thereof: NA
(iv) The expenditure incurred on Research and Development
| || ||(Rs. in Lakh) |
| ||2020-21 ||2019-20 |
|(a) Capital Expenditure ||12.75 ||31.50 |
|(b) Revenue ||817.43 ||777.76 |
|Total ||830.18 ||809.26 |
C) FOREIGN EXCHANGE EARNINGS AND OUTGO
| ||(Rs. in Lakh) || |
| ||2020-21 ||2019-20 |
|i ) Total Foreign Exchange Earnings ||4855.16 ||6740.61 |
|i i ) Total Foreign Exchange Outgo ||9774.55 ||10571.50 |
DETAILS OF PROCUREMENT FROM MICRO SMALL AND MEDIUM ENTERPRISES AS PER PUBLICPROCUREMENT POLICY FOR MICRO AND SMALL ENTERISES (MSEs) ORDER 2012
| || ||(Rs. in Lakh) |
|Details ||2020-21 ||2019-20 |
|Goals set with respect to procurement to be met from Micro and Small Enterprises ||12658 ||19230 |
|Actual procurement ||8554 ||7160I |
In terms of Section 92 of the Companies Act 2013 read with Rules made thereunder theCompany shall 29 place a copy of the Annual Return (MGT-7) on the website of the Companywww.balmerlawrie.com after filing the same with Ministry of Corporate Affairs.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(3)(c) and 134(5) of the Companies Act2013 ("the Act") the Board of Directors to the best of their knowledge andability state that: (a) In the preparation of the annual accounts for the Financial Yearended 31st March 2021 the applicable accounting standards had been followed along withproper explanation relating to material departures.
(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 andfair view of the state of affairs of your Company at the end of the Financial Year as on31st March 2021 and of the Profit and Loss of your Company for that period. (c) TheDirectors had taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of yourCompany and for preventing and detecting fraud and other irregularities.
(d) The Directors had prepared the annual accounts for the Financial Year ended 31stMarch 2021 on a going concern basis.
(e) The Directors had laid down internal financial controls to be followed by yourCompany and that such internal financial controls are adequate and were generallyoperating effectively.
(f) The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DECLARATION BY INDEPENDENT DIRECTORS
Your Company has received declaration from the Independent Directors of the Companyconfirming that they meet the criteria of independence prescribed under the Companies Act2013 and the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Detailed particulars of Loans Guarantees and Investments under Section 186 of theCompanies Act 2013 are given in Note No. 6 7 15 and 42.18 of the Standalone FinancialStatements.
RELATED PARTY TRANSACTIONS (RPT)
Majority of the Related Party Transactions of the Company were made with its HoldingCompany Subsidiary companies Associate companies and Joint Venture companies. It may bepertinent to mention that as per Regulation 23(5) of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 sub-regulations(2) (3) and (4) of Regulation 23 of the said Regulations shall not apply to transactionsentered into between two government companies and transactions entered into between aholding company and its wholly owned subsidiary whose accounts are consolidated with suchholding company and placed before the shareholders at the general meeting for approval.Further omnibus approval was taken for entering into Related Party Transactions for valueupto Rs. One Crore whereas in other cases approval (including post facto approvals) ofAudit Committee was taken. Further there were no materially significant RPT during theyear under review made by the Company with Directors Key Managerial Personnel or otherdesignated persons which have a potential conflict with the interest of the Company atlarge. The Company had revised the RPT Policy of the Company in terms of the amendedSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015. The policy as amended w.e.f. 4th February 2020 may be accessed on theCompany's website at the link: https://www.balmerlawrie.com/adminls/dl_u/Related_Party_Transaction_Policy_dated_04-02-2020.pdf The said policy lays down a procedure toensure that transactions by and between a Related Party and the Company are properlyidentified and reviewed to ensure that the Related Party Transactions are properlyapproved and disclosed in accordance with the applicable law. The Policy also sets outmateriality thresholds for Related Party Transactions.
The details of the Related Party Transactions entered into by your Company during theFinancial Year 2020-21 has been enumerated in Note no. 42.18 of Standalone FinancialStatements.
JUSTIFICATION FOR ENTERING INTO RELATED PARTY TRANSACTIONS
The Related Party Transactions are entered into based on considerations of variousfactors like business exigencies synergy in operations the policy of the Company andCapital Resources of the Subsidiaries and Associates.
The particular of contracts or arrangements with Related parties referred to insub-section (1) of section 188 as required under Section 134(3)(h) of the Companies Act2013 in the prescribed Form AOC-2 is as under:
|FORM NO. AOC 2 |
|(Pursuant to clause (h) of sub-section (3) of section 134 of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014) |
|Form for disclosure of particulars of contracts/ arrangements entered into by the Company with |
|Related Parties referred to in sub-section (1) of section 188 of the Companies Act 2013 including certain arm's length transactions under third proviso thereto |
|1 Details of contracts or arrangements or transactions not at arm's length basis |
|2 Details of material contracts or arrangements or transactions at arm's length basis |
|NIL as per the Company's policy on material Related Party Transaction |
ENTERPRISE RISK MANAGEMENT POLICY
The company has an approved Enterprise Risk Management Policy' (ERM Policy) toprotect and add value to the organization. These Risks are classified into High Mediumand Low depending upon the probability of their occurrence and potential impact. Thisprocess ensures that the Company is adequately positioned to understand and developmitigation measures as a response to risks that could potentially impact the execution ofour strategy and ability to create value. During FY 2020-2021 the Risk management processwas reviewed on quarterly basis at Chief Risk Officer level with Business Risk Owners andwere reported to the Risk Management Committee and Board.
The said policy is posted on the Company's website at:https://www.balmerlawrie.com/adminls/dl_u/ERM_ Policy01_08_17.pdf
Your Company has not accepted any deposit from the public during the Financial Year2020-21 and therefore no disclosure is required in relation to details relating todeposits covered under Chapter V of the Companies Act 2013.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and the Company's operations in future.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
Your company has put in place adequate financial controls for ensuring the efficientconduct of its business in adherence with laid down policies the safeguard of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information which iscommensurate with the operations of the Company. Effectiveness of Internal Financialcontrol is ensured through management review control and self-testing and independenttesting by the external Consultant. During the Financial Year 2020-21 Internal FinancialControl was reviewed by an external Consultant Haribhakti & Co. LLP which reported asfollows: a. The Internal Control over financial reporting in the Company is generallyadequate for the process/ controls covered with areas of observations/ improvements aslisted in the report. b. The observations have been discussed/ acknowledged by the processowners and also reported to management.
Shri Vinod Kumar IFoS was the Chief Vigilance Officer with effect from 10th October2018 & continued to remain CVO till September 2020. Then Shri Anant Kumar Singh IPS(MP:1994) has taken over the charge as CVO of the company on & from 24th February2021. Balmer Lawrie is always in the opinion to promote integrity and eradicatecorruption. Principles of good governance is also one of the major aspect which helpsBalmer Lawrie to lead the business scenario in a transparent manner. Vigilance departmentendeavors to ensure that the management obtains maximum out of its various transactionswith the stakeholders. The Company welcomes the stakeholders to combat any corruptionwhich may come across. Vigilance department has been making efforts to spread awarenessand information about vigilance administration and good corporate governance. It isneedless to mention that Vigilance Department has taken lot of initiatives in theimprovements in the systems and procedures which have been implemented. Central VigilanceCommission from time to time issues various directives in the matter of leveragingtechnology in respect of e-procurement e-disposals and on-line posting of jobapplications which have been implemented keeping in view to bring in more transparency.As per the directives of Central Vigilance Commission this year also Vigilance AwarenessWeek was observed by the Company. Considering the pandemic situation we have conductedall the activities through online only. Programme Started by taking e-pledge through PANIndia and followed by Quiz/Slogan/ Essay/Debate competitions - held in various schools andcolleges which had TV coverages of different channels. Posters and banners were displayedin various places for publicity. Last but not the least Vendors Meet was held andintegrity pledges were also taken by the Vendors on virtual mode. Integrity pledge wasalso taken by the students of schools/ colleges and by the employees families throughonline system. As per the CVC guideline this year as a new concept we have made some deepsurvey on the "Internal House Keeping Activities" like Land Management;Allotment of Houses & Quarters; Management of Assets; Payment to the OutsourcedServices & Gender Sensitization etc.
Integrity Pact: -
IEM has been appointed to implement Integrity Pact beyond the tender threshold value ofRs.10 Crores & above. So far company has conducted three meetings & there were nocomplaints received which were referred to IEMs. Presently 2 Independent ExternalMonitors (IEMs) have been appointed based on the nomination by the Central VigilanceCommission (CVC) to monitor the implementation of IP in all tenders of the value of Rs.30 lakhs to Rs.10 Crores across all the division of the Company. The details of such IEMsare as follows:
1. Dr. Bibhuti Bhusan Pattanaik
302 New Shivalik CGHS Plot No. G44 Sector 51 Gurgaon- 122002.
2. Shri Brij Mohan Kohli
M-88 Ground Floor GK 2 New Delhi - 110048
DETAILS OF VIGILANCE CASES
In terms of office memorandum dated 24th January 2018 having referenceno.F.No.28(1)/2016-Leg.I issued by Under Secretary to Government of India details ofvigilance cases disposed off during the year ended 31st March 2021 and vigilance casespending as on 31st March 2021 is mentioned herein below: a. Vigilance Cases disposedoff during the year ended 31st March 2021
|Sl. Nature of Case ||Case Date ||Date of Disposal ||Remarks |
|1. Complaint against Dr. P. Awade AVP(Sales) G&L Mumbai ||03.09.2020 ||02.03.2021 ||CVO advised to close the complaint as the complaint was anonymous in nature |
b. Vigilance Cases pending as on 31st March 2021
|Sl. Nature of Case ||Case Date ||Remarks |
|1. Financial Irregularity at Travel Department ||17.03.2016 ||Case is pending with CBI |
|2. Examination of Audit Para (VEDPL) ||04.04.2018 ||Files are with CVO's Office. Investigation is going on |
|3. Complaint against renewal of Contract to one transporter at Southern Region ||08.07.2019 ||Investigation is going on |
|4. Unfair trade practices followed by BL at Western Region ||12.12.2019 ||Investigation is going on |
|5. Fraudulent Air ticket booking by BL ||17.12.2019 ||Investigation is going on |
|6. Allegation against Senior Official of HR Department of BL ||17.12.2019 ||Investigation is going on |
|7. Request for Information into fraud & Corrupt activities taking place at BL & Co. (RTI) ||06.01.2021 ||Investigation is going on |
|8. Complaint against Director ||17.03.2021 ||Investigation is going on |
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Balmer Lawrie had established a Vigil Mechanism/ Whistle Blower Policy in January2010. The said policy concerns the employees and covers the following categories:
- Unionized Employees
- Any other employees (such as Out Sourced Contractual Temporaries TraineesRetainers etc. as long as they are engaged in any job/ activity connected with theCompany's operation).
So as to enable them to report management instances of unethical behaviour actual orsuspected fraud or violation of your company's code of conduct. The details of the vigilmechanism /whistle blower policy are given in the corporate governance report 2020-21 andcan be downloaded from the following hyperlink of the company's website:http://www.balmerlawrie. com/app/webroot/uploads/whistle_blower_policy.pdf
REPORT ON CORPORATE GOVERNANCE
Your Company has been consistently complying with the various Regulations andGuidelines of the Securities & Exchange Board of India (SEBI) as well as of Departmentof Public Enterprises (DPE) to the extent within its control.
Pursuant to the said SEBI Regulations and DPE Guidelines a separate section titledCorporate Governance Report' is being furnished and marked as
The provisions on Corporate Governance under DPE Guidelines which do not exist in theSEBI Guidelines and also do not contradict any of the provisions of the SEBI Guidelinesare also complied with.
Further your Company's Statutory Auditors have examined compliance of conditions ofCorporate Governance and issued a certificate which is annexed to this Report and markedas "Annexure 3B".
DETAILS RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL AND EMPLOYEES
Your Company being a Government Company vide Notification No. GSR 463(E) dated 5thJune 2015 as amended by Notification No. GSR 582(E) dated 13th June 2017 andnotification No. GSR 802(E) dated 23rd February 2018 has been exempted fromapplicability of Section 134(3)(e) and 197 of the Companies Act 2013.
BOARD EVALUATION AND CRITERIA FOR EVALUATION
Your Company being a Government Company vide Notification No. GSR 463(E) dated 5thJune 2015 as amended by Notification No. GSR 582(E) dated 13th June 2017 andnotification No. GSR 802(E) dated 23rd February 2018 has been exempted fromapplicability of Sections 134(3)(p) and 178(2) (3) and (4) of the Companies Act 2013.
The Annual Performance Appraisal of Top Management Incumbents of Central PublicSector Enterprises is done through the Administrative Ministry as per the DPE Guidelinesin this regard.Your Company being a Central Public Sector Enterprise under theadministrative jurisdiction of Ministry of Petroleum & Natural Gas also has to followthe similar procedure.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board of the Company as on 31st March 2021 consisted of Ten Directors out of whichthree were Functional/Executive/Whole-time Directors two were Non-executive GovernmentNominee Directors and five were Independent Directors. The following changes in thecomposition of Board of Directors took place during the Financial Year 2020-21:
Shri Shyam Sundar Khuntia erstwhile Director (Finance) ceased to be a Director of theCompany w.e.f. 1st May 2020.
Shri Prabal Basu erstwhile Chairman & Managing Director ceased to be a Director ofthe Company w.e.f. 1st November 2020.
Shri Sunil Sachdeva Independent Director ceased to be a Director of the Company w.e.f.8th September 2020.
Shri Kushagra Mittal had been appointed as a Non-Executive Additional Director in thedesignation of Government Nominee Director on 20th January 2021.
Shri Vijay Sharma ceased to be a Non-Executive Government Nominee Director w.e.f. 20thJanuary 2021.
Owing to vacancy in the post of Chairman and Managing Director and Director(Manufacturing Businesses) Shri Adika Ratna Sekhar Director (Human Resource &Corporate Affairs) was entrusted with the interim/additional charge for the said post bythe administrative ministry from time to time. The following changes in the composition ofBoard of Directors took place during the period after end of the Financial Year 2020-21till the date of this report:
1. Shri Vikash Preetam Independent Director ceased to be director of the Companyw.e.f. 24th July 2021 due to completion of his tenure as per the nomination by theMOP&NG.
2. Smt. Perin Devi Government Nominee Director ceased to be director of the Companyw.e.f. 26th July 2021 due to completion of her tenure as per the nomination by theMOP&NG. However the administrative ministry has vide letter dated 5th August 2021directed the Company about appointment of Smt. Perin Devi as Government Nominee Directorfor a period of 3 years with effect from 5th August 2021 on co-terminus basis or untilfurther orders of the administrative ministry whichever is earlier. Considering the aboveappointments and cessation as on date of this report the Board is consisted of Nine (9)Directors out of which: Three (3) are Functional/Executive/Whole-time Directors;Two (2) are Non-executive Government Nominee Directors; and Four (4) areIndependent Directors.
It may be noted that pursuant to Article 7A of the Articles of Association of theCompany so long as the Company remains a Government Company the Directors (includingIndependent Directors) are to be nominated by the Government of India.
NUMBER OF MEETINGS OF THE BOARD
The Board met seven (7) times during the financial year 2020-21 the details of sameare given in the Corporate Governance Report attached as "Annexure
3". The intervening gap between any two Board meetings was within the periodprescribed under the Companies Act 2013 SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and DPE Guidelines on Corporate Governance.
During the year following Directors were appointed by the Shareholders at the 103rdAGM:
1. Shri Adhip Nath Palchaudhuri Director (Service Businesses)
2. Shri Sandip Das Director (Finance)
Futher Shri Kushagra Mittal had been appointed as a Non-Executive Additional Directorin the designation of Government Nominee Director on 20th January 2021. It is proposed toappoint Shri Kushagra Mittal as Government Nominee Director of the Company at the ensuingAGM in furtherance of the nominations received from the Administrative Ministry and hiscandidature proposed by the shareholder of the Company.
Smt.PerinDeviGovernmentNomineeDirectorceased to be director of the Company w.e.f. 26thJuly 2021 due to completion of her tenure as per the nomination by the MOP&NG.However the administrative ministry has vide letter dated 5th August 2021 directed theCompany about appointment of Smt. Perin Devi as Government Nominee Director for a periodof 3 years with effect from 5th August 2021 on co-terminus basis or until further ordersof the administrative ministry whichever is earlier. The resolutions regarding theappointment of Shri. Kushagra Mittal and Smt. Perin Devi have been proposed at the 104thAGM and the details form part of the Notice of the 104th AGM. Shri Adika Ratna Sekhar wasappointed as the Chairman & Managing Director (Additional Charge) of the Company witheffect from 1st November 2020 to 31st January 2021 pursuant to the letterNo.CA-31024/1/2020-PNG (35641) dated 6th January 2021 received from the Ministry ofPetroleum & Natural Gas (MOP&NG) Government of India and for a further period ofone year w.e.f. 1st February 2021 or till the appointment of a regular incumbent to thepost or until further orders whichever is the earliest pursuant to the letter bearingreference no. CA-31024/1/2020-PNG (35641) dated 20th April 2021 from MOP&NG. In theensuing AGM the resolution to this effect has been proposed to the members for theirapproval.
In the ensuing AGM it is proposed to consider reappointment of Shri Adhip NathPalchaudhuri (DIN 08695322) who retires by rotation and being eligible offers himself forreappointment.
The details of the directors seeking reappointment and appointment are given in theexplanatory statement attached to the notice of the 104th AGM.
CESSATIONS ON ACCOUNT OF WITHDRAWAL OF NOMINATION OR RETIREMENT
- Shri Shyam Sundar Khuntia Director (Finance) and Chief Financial Officer ceased tobe the Director on the Board of the Company with effect from 1st May 2020 consequent tohis superannuation.
- Shri Sunil Sachdeva Independent Director ceased to be the Director on the Board ofthe Company with effect from 8th September 2020 on account of completion of his tenure.
- Shri Prabal Basu Chairman and Managing Director ceased to be the Director on theBoard of your company with effect from 1st November 2020 on account of cessation ofnomination by the administrative ministry.
- Shri Vijay Sharma Government Nominee director ceased to be the Director on the Boardof your Company with effect from 20th January 2021.
Your Company has a qualified and independent Audit Committee the composition of sameand other details are mentioned in the Corporate Governance Report for the Financial Year2020 21. The Audit Committee as on 31st March 2021 consisted of five (5) membersout of which one was Whole-time Director and four were Independent Directors. ShriBhagawan Das Shivahare Independent Director is the Chairperson of the Committee. Thecomposition of the Audit Committee as on 31st March 2021 was as follows: i. Shri BhagawanDas Shivahare Independent Director-Chairperson ii. Shri Vikash Preetam IndependentDirector-Member iii. Shri Arun Tandon Independent Director-Member iv. Shri Anil KumarUpadhyay Independent Director-Member v. Shri Sandip Das Director (Finance) & CFO-Member All the members of the Audit Committee are financially literate and some memberspossess accounting/ financial management expertise also. The Company Secretary acts as theSecretary to this Committee.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company is in compliance with the applicable Secretarial Standards (1&2) issuedby the Institute of Company Secretaries of India and approved by the Central Governmentunder Section 118(10) of the Companies Act 2013.
STATUTORY AUDITORS & AUDITORS' REPORT Statutory Auditor:
Your Company being a Government Company Statutory Auditors are appointed orreappointed by the Comptroller and Auditor General of India in terms of Section 143(5) ofthe Companies Act 2013.
In terms of the Companies Act 2013 Comptroller & Auditor General of India(C&AG) has appointed M/s. B K Shroff & Co; (Chartered Accountant) 23A NetajiSubhas Road Room No. 15 3rd Floor Kolkata 700001 West Bengal asStatutory Auditors of the Company for the Financial Year 2020-21 for both Standalone aswell as the Consolidated Financial Statements of the Company.
Pursuant to Section 142 and other applicable provisions of the Companies Act 2013 theremuneration of the Auditors for the year 2020-21 is to be determined by the members atthe ensuing Annual General Meeting as envisaged in the said Act. Members are requested toauthorize the Board to decide on their remuneration as per applicable statutoryprovisions.
REPORT OF THE STATUTORY AUDITORS
Report of the Statutory Auditors is annexed with the Financial Statements. TheStatutory Auditors of the Company have reported a fraud as specified under the secondproviso to section 143(12) of the Companies Act 2013. As per para "x" of theStatutory Auditors Report dated 25.06.2021 on "Other Legal and RegulatoryRequirements" a fraud has been detected by the Coimbatore Implant of Travel Chennaiunit of the company to the tune of Rs. 29.98 lakhs for which action has already been takenby the management and insurance claim has also been lodged with the insurance companyunder fidelity policy on 06.11.2020.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA (CAG)
The Comments of CAG are received by the Company. CAG vide its letters dated 26thAugust 2021 have stated that on the basis of their supplementary audit nothingsignificant has come to their knowledge which would give rise to any comment upon orsupplement to statutory auditor's report under section 143(6)(b) of the Act.
MAINTENANCE OF COST RECORDS
Your Company has made & maintained such Cost Accounts & Records as specified bythe Central Government under sub-section (1) of Section 148 of the Companies Act 2013.
COST AUDITOR'S REPORT
Cost Audit Reports for all the applicable products for the year ended 31st March 2020were filed on 26th September 2020 with Cost Audit Cell of Ministry of Corporate Affairswithin specified due dates.
Pursuant to Section 148 of the Companies Act 2013 the Board of Directors onrecommendation of the Audit Committee appointed M/s. S. B. & Associates CostAccountants as the Cost Auditor of your Company for the Financial Years 2020-21 and2021-22 relating to goods manufactured by Strategic Business Units: Greases &Lubricants Industrial Packaging and Leather Chemicals of your Company. The remunerationproposed to be paid to the Cost Auditor requires ratification of the members of yourCompany. In view of this ratification for payment of remuneration to the Cost Auditor forthe Financial Year 2021-22 is being sought at 104th Annual General Meeting.
Pursuant to the provision of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hadappointed M/s. M R & Associates Company Secretaries to conduct Secretarial Audit ofthe Company for the Financial Year 2020-21. The Secretarial Audit Report in Form No. MR-3for the Financial Year ended 31st March 2021 is annexed herewith and marked as"Annexure 4".
SECRETARIAL AUDITORS' REPORT
The qualifications / adverse remark / disclaimer made by the Secretarial Auditor andthe corresponding management response are as enumerated below.
|Sl. Observation/ Comment/ qualification No. of the Secretarial Auditors ||Clarification from the Management |
|1 The Board of Directors of the company is constituted with proper balance of Executive Directors Non-Executive Directors and Independent Directors subject to the appointment of Woman Independent Director. ||The Company is a Government Company as it is evident from the shareholding pattern. |
| ||As per the Articles of Association of the Company so long as the Company remains a Government Company the President of India shall be entitled to appoint one or more person(s) to hold office as Director(s) on the Board. Accordingly composition of the Board of Directors is dependent on the direction of administrative ministry. |
Your Directors are focused on creation of enduring value for all stakeholders utilizingmultiple drivers of growth in the diverse Strategic Business Units of the Company.
Towards that end the Directors wish to place on record their sincere appreciation ofthe significant role played by the employees towards realization of new performancemilestones through their dedication commitment perseverance and collective contribution.The Board of Directors also places on record its deep appreciation of the support andconfidence reposed in your Company by its customers as well as the dealers who havecontributed towards the customer-care efforts put in by your Company. The Directors wouldalso wish to thank the vendors business associates consultants bankers auditorssolicitors and all other stakeholders for their continued support and confidence reposedin your Company.
The Directors are also thankful to Balmer Lawrie Investments Ltd. (the Holding Company)and the Ministry of Petroleum & Natural Gas Government of India for its valuableguidance and support extended to the Company from time to time.
Finally the Directors wish to place on record their special appreciation to the valuedShareholders of your Company for their unstinted support towards fulfilment of itscorporate vision.
| ||On behalf of the Board of Directors |
| ||Adika Ratna Sekhar |
| ||Chairman & Managing Director - (Additional Charge) |
| ||and Director (Human Resource & Corporate Affairs) |
| ||and Director (Manufacturing Businesses) - (Additional Charge) |
|Registered Office: || |
|Balmer Lawrie House || |
|21 Netaji Subhas Road || |
|Kolkata 700001. ||Adhip Nath Palchaudhuri |
|Date: 6th August 2021 ||Director (Service Businesses) |