Your Directors have pleasure in presenting the Twenty Ninth (29th)Annual Report of your Company together with the audited Financial Statements for the yearended 31st March 2022.
The Financial Statements for the year ended 31.03.2022 have beenprepared in accordance with Indian Accounting Standards ("Ind AS") consequent tothe Notification of the Companies (Indian Accounting Standards) Rules 2015 issued by TheMinistry of Corporate Affairs:
Financial Results - Standalone
| || ||(Rs. in Lakhs) |
|Particulars ||Year ended 31.03.2022 ||Year ended 31.03.2021 |
|Net Sales ||43566.74 ||31789.77 |
|Other income ||87.07 ||63.81 |
|Total Income ||43653.81 ||31853.58 |
|PBDIT ||6919.00 ||4764.12 |
|Depreciation ||(864.89) ||(814.37) |
|Interest ||(907.80) ||(826.42) |
|Profit Before Exceptional Items and Tax ||5146.31 ||3123.33 |
|Exceptional Items ||- ||105.40 |
|Profit after Exceptional Items and Before Tax ||5146.31 ||3228.73 |
|Provision for tax (Incl. deferred tax) ||(1556.06) ||(882.31) |
|Profit after tax ||3590.26 ||2346.42 |
|Earnings per share (EPS) ||43.21 ||28.24 |
|Diluted (EPS) ||43.21 ||28.24 |
Performance Review and State of Affairs:
The revenue from operations for the FY 2021-22 was Rs. 43566.74 lakhsas against the previous year's revenue from operations of Rs.31789.77 lakhs in FY2020-21. The PAT attributable to shareholders for FY 2021-22 was Rs.3590.26 lakhs ascompared to the previous year's PAT of Rs. 2346.42 lakhs. The Profit before Tax was Rs.5146.31 lakhs as against the previous year's PBT of Rs. 3228.73 lakhs. The Earnings perShare stood at Rs. 43.21 for the year under review as against Rs. 28.24 per share of theprevious year.
The Domestic and Export Sales for the year increased by 34.04% and47.40% respectively. Domestic Sales growth is largely driven by volume & mix and isbroad based.
Change in the nature of the business if any:
There is no change in the nature of the business of the Company and itssubsidiary during the year under review.
The Board of Directors at its meeting held on 26th May2022 recommended a final dividend of ? 2.00/- per equity share of face value of ? 10/-each (i.e. 20%) and the same shall be paid subject to approval of the shareholders at theensuing 29th Annual General Meeting making a total dividend of ? 3/- @ 30% perequity share for the financial year ended March 31 2022 including an interim dividend of? 1/- @ 10% per equity share declared earlier during the Financial Year 2021-22.
Details of Interim Dividend Paid during the year:
|Particulars ||Approval Date ||Payment Date ||Dividend per equity share |
|1st Interim Dividend for FY 2021-22 ||30.10.2021 ||19-11-2021 ||? 1/- @ 10 % |
In view of the changes made under the Income Tax Act 1961 by theFinance Act 2020 dividend paid or distributed by the Company shall be taxable in thehands of the shareholders. Your Company shall accordingly make the payment of thedividend after deduction of tax at source.
The Register of Members and Share Transfer Books of the Company willremain closed from Saturday August 6 2022 to Friday August 12 2022 (both daysinclusive) for ascertainment of shareholders eligible to receive dividend for thefinancial year ended March 31 2022.
Dividend Distribution Policy
In terms of Regulation 43A of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") the Company has formulated and adopted a Dividend Distribution Policywith the objective of providing clarity to its stakeholders on the profit distributionstrategies of the Company. During the year the said Policy has been reviewed by the Boardof Directors of the Company and hosted on the website of the Company at https:/www.bhagirad.com/corporate.html
Transfer of Un-Claimed Dividends/Shares
Pursuant to the provisions of Section 124 of the Act InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016 ("IEPF Rules") read with the relevant circulars and amendments thereto theamount of dividend remaining unpaid or unclaimed for a period of seven years from the duedate is required to be transferred to the Investor Education and Protection Fund("IEPF") constituted by the Central Government. The following are the year wisedividends remaining unclaimed as on 31.03.2022
|Financial Year ||Date of Declaration of Dividend ||Amount as on 31.03.2022 (In Rs..) ||Due Date for transfer to IEPF |
|2014-15 ||08-08-2015 ||94677 ||12-09-2022 |
|2018-19 ||09-08-2019 ||62246 ||13-09-2026 |
|2021-22 (interim dividend) ||30-10-2021 ||8572 ||30-11-2028 |
Transfer of unclaimed dividend to IEPF during the year underreview
Pursuant to Section 124(5) of the Companies Act 2013 read with theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 as amended from time to time the unclaimed/unpaid dividend amount of Rs.80886/- (Rupees Eighty Thousand Eight Hundred and Eighty- Six only) for the year 2013-14was transferred to the Investor Education and Protection Fund during the financial year2021-22.
Transfer of shares to IEPF
In compliance with the provisions of Section 124 of the Companies Act2013 the Company has transferred 3185 no of equity shares belonging to 24 members of thecompany to Investor Education and Protection Fund Authority (IEPF) of those members whohave not claimed the dividends for a continuous period of 7 years. Details of sharestransferred to IEPF have been uploaded on the website of the Company.
Pursuant to Section 124 of the Companies Act 2013 read with theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 as amended from time to time the shares (in respect of which the dividend hasnot been claimed for consecutive seven years) and unclaimed/ unpaid dividend pertainingfor the financial year 201415 shall be transferred to the Investor Education andProtection Fund during the financial year 2022-23. The members who have not claimed theirdividend are requested to claim it before September 12 2022.
The shareholders whose shares got transferred to IEPF Authority shallclaim the dividends and shares from IEPF Authority by submitting an online application inthe prescribed Form No. IEPF-5 available on the website at www.iepf.gov.in as per theprocedure prescribed thereon.
Smt. Sharanya. R is the Nodal Officer who is appointed by the Companyunder the provisions of IEPF.
Transfer to reserves
The closing balance of the retained earnings of the Company for FY2021-22 after all appropriation and adjustments stood at Rs. 18183.65 lakhs.
Listing on National Stock Exchange of India Limited (NSE)
The equity shares of your Company got listed on National Stock Exchangeof India Limited with effect from October 18 2021
During the year under review the Authorised share capital of thecompany was increased from Rs.100000000 (Rupees Ten Crores Only) divided into10000000 (One Crore) Equity Shares having face value of Rs. 10/- each to ? 150000000(Rupees Fifteen Crores Only) divided into 15000000 (One Crore Fifty Lakhs) EquityShares having face value of Rs. 10/- each with the approval of the shareholders in the EGMconducted through postal ballot on February 52022 and the paid up capital of the companyas on 31.03.2022 stood at Rs. 83097000 divided into 8309700 equity shares of Rs. 10/-each. During the financial year ended on 31.03.2022 the Company has not raised any fundsin the form of equity. During the FY 2021- 22 your Company has not issued any furthershares. The Company has paid listing fee for the financial year 2022-23 to BSE Limitedand National Stock Exchange of India Limited (NSE) where its shares are listed.
After the year under review the Company has issued and allotted (a)1955083 Equity Shares of face value of Rs.10.00 each at a price of Rs. 400.00 per Share(including a premium of Rs. 390.00 per Share) on 10th May 2022 on Rights basisto the existing shareholders as on April 092022 and (b) 140700 Equity Shares of facevalue of Rs. 10.00 each at a price of Rs. 400.00 per Share (including a premium of Rs. 390per Share) on 10 May 2022 through the same Issue under Employee Reservation Portion.
The paid up share capital of the Company thus increased from Rs.83097000 divided into 8309700 equity shares of Rs. 10/- each to Rs. 104054830divided into 10405483 equity shares of Rs. 10/- each in the current year.
Buy Back of shares and disinvestment
The Company has not bought back any of its securities and there was nodisinvestment during the Financial Year ended March 31 2022.
Consolidated Financial Statements
The Consolidated Financial Statements are prepared in accordance withIndian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards)Rules 2015 notified under Section 133 of the Companies Act 2013 and other relevantprovisions of the Companies Act 2013. The Consolidated Financial Statements for theFinancial Year ended 31st March 2022 form part of the Annual Report.
Material changes and commitments affecting the financial position ofthe company between the end of the financial year and the date of the report
There are no material changes and commitments affecting the financialposition of the company which occurred after the end of the financial year i.e. March31 2022 except for the following:
After the year under review the Company has issued and allotted (a)1955083 Equity Shares of face value of Rs.10.00 each at a price of Rs. 400.00 per Share(including a premium of Rs. 390.00 per Share) on 10th May 2022 on Rights basisto the existing shareholders as on April 092022 and (b) 140700 Equity Shares of facevalue of Rs. 10.00 each at a price of Rs. 400.00 per Share (including a premium of Rs. 390per Share) on 10 May 2022 through the same Issue under Employee Reservation Portion.
The paid up share capital of the Company thus increased from Rs.83097000 divided into 8309700 equity shares of Rs. 10/- each to Rs. 104054830divided into 10405483 equity shares of Rs. 10/- each.
Impact of COVID-19
The COVID-19 has impacted lives and livelihood all around. As a goodCorporate Citizen the company pledged its support towards India's fight against COVID-19by lending a hand to the Government's efforts to endure the social and economic impacts ofthe Coronavirus pandemic.
Your Company continually assessed and took proactive measures tocounter the COVID-19 pandemic and engaged closely with its employees partners customersand society to promote safe operations. It worked with the Government and local regulatorybodies and supported them through various initiatives in combating the virus.
The company has implemented COVID-19 safety protocols across itsoperations to help protect and support its employees customers and suppliers. It hascreated Standard Operating Procedures to be followed across its operations includingSupply chain Marketing and other areas. Thorough thermal scanning and sanitisationprotocols continued during the year at the plant and offices. Regular Monitoring ofemployees for signs and symptoms through voluntary disclosure is still in place.
During the financial year ended 31.03.2022 by the second half of theyear all the functions including sales and distribution procurement supply chainlogistics and corporate functions were brought to near-normal level duly following safetyguidelines and without any material adverse impact. The Company continues to make effortsto minimize adverse impact on its operations and performance due to COVID-19. Your Companyis committed to support the Government and other authorities to extend its helping hand inthe fight against COVID-19 pandemic.
Management Discussion and Analysis
In terms of the provisions of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 as amended from time to time the Management'sDiscussion and Analysis is provided in a separate section and forms an integral part ofthis Report.
The Composition of the Board of Directors as on 31.03.2022 is as under:
|Name ||Designation |
|Sri Satyanarayana Raju Kanumuru ||Chairman Non-Executive Independent Director |
|Sri Chandra Sekhar Singavarapu ||Managing Director |
|Sri Ketan Chamanlal Budh ||Whole Time Director |
|Sri Sudhakar Kudva ||Non-Executive Independent Director |
|Smt Lalitha Sree Singavarapu ||Non-Executive Non Independent Director |
|Sri G.S.V. Krishna Rao ||Non-Executive Independent Director |
|Sri Kishor Shah ||Non-Executive Independent Director |
|Dr G. Aruna ||Non-Executive Independent Woman Director |
None of the directors of the company is disqualified under theprovisions of the Companies Act 2013 (Act') or under the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015
Declaration from Independent Directors
The independent directors have submitted the declaration ofindependence stating that they meet the criteria of independence as prescribed insub-section (6) of Section 149 of the Companies Act 2013 as well as under Regulation16(1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
The Board is of the opinion that the Independent Directors of theCompany possess requisite qualifications experience and expertise in chemicals/manufacturing industry strategy auditing tax and risk advisory services financialservices corporate governance etc. and that they hold standards of integrity. TheIndependent Directors have also confirmed that they have complied with the Company's Codeof Conduct for Board members and Senior Management and Codes under SEBI (Prohibition ofInsider Trading) Regulations 2015.
Change in Directors:
During the year under review there was a change in the category ofdirectorship of Sri K S Raju (DIN: 00008177) from Non-Executive Director to IndependentNonExecutive Director (in the Chairman Category) and he was appointed as a Non-ExecutiveIndependent Director (in the category of Chairman of the Company) to hold office for aterm up to 3 (three) consecutive years from December 14 2021 to December 13 2024.
During the year under review Sri. D. Sadasivudu NonExecutive - NonIndependent Director who was to retire by rotation had not opted for re-appointment andretired from the Board w.e.f 10.08.2021.
Pursuant to Section 152 of the Companies Act 2013 and the Articles ofAssociation of the Company Smt. Singavarapu Lalitha Sree (DIN: 06957985) Non-ExecutiveNon Independent Director of the Company retires by rotation and being eligible offersherself for re-appointment. Her appointment is placed for approval of the members andforms part of the notice of the 29th Annual General Meeting. The informationabout the Director seeking re-appointment as per the Secretarial Standards on GeneralMeetings and Regulation 36 (3) of Listing Regulations has been given in the noticeconvening the 29th AGM.
Key Managerial Personnel (KMP'):
During the year under review the Company is having the followingpersons as Key Managerial Personnel.
Sri S. Chandra Sekhar Managing Director
Sri Ketan Chamanlal Budh Whole time Director
Sri A. Arvind Kumar Chief Executive Officer
Sri B. Krishna Mohan Rao Chief Financial Officer
Smt Sharanya. R Company Secretary & Compliance Officer*
*Smt. Sharanya. R Company Secretary & Compliance Officer(appointed on February 26 2022)
*During the year under review Smt Saheli Banerjee (ACS: 44382)Company Secretary and Compliance officer had resigned w.e.f. February 25 2022 and Smt.Sharanya. R was appointed as the Company Secretary and Compliance Officer w.e.f February26 2022.
Meetings of the Board
During the period under review six meetings of the Board of Directorsof the Company were held on 04-05-2021 12-08-2021 30-10-2021 14-12-2021 04-01-20222901-2022 in accordance with the provisions of the Act. The date(s) of the Board Meetingand attendance by the directors are given in the Corporate Governance Report forming anintegral part of this report.
The Company also adopted Governance Guidelines on Board Effectivenesswhich comprise the aspects relating to Composition of Board and Committees Terms ofDirectors Nomination Appointment Development of Directors Code of ConductEffectiveness of Board and Committees review and their mandates.
Meeting of Independent Directors
A separate meeting of the Independent Directors was held on 04thMay 2021 inter-alia to discuss evaluation of the Performance of Non-IndependentDirectors the Board as a whole evaluation of the performance of the Chairman takinginto account the views of the Executive and NonExecutive Directors and the evaluation ofthe quality content and timeliness of flow of information between the management and theBoard that are necessary for the Board to effectively and reasonably perform its duties.
Committees of the Board
During the period under review the Board has five committees i.e.Audit Committee Nomination and Remuneration Committee Corporate Social ResponsibilityCommittee Stakeholders Relationship Committee and Risk Management Committee.
A detailed note on the Board and its committees is provided under theCorporate Governance Report section in this Annual Report. The composition of thecommittees and compliances as per the applicable provisions of the Act and Rules are asfollows:
|S.No Name of the Committee ||Composition of the Committee ||Highlights of duties responsibilities and activities |
|1. Audit committee ||Sri Sudhakar Kudva (C) Sri Chandra Sekhar Singavarapu (M) ||All recommendations made by the audit committee during the year were accepted by the Board. |
| ||Sri Krishna Rao S V Gadepalli (M) Sri Kishor Shah (M) ||Reviewing with the management the quarterly financial statements before submission to the Board for approval. |
| || ||Approval or any subsequent modification of transactions of the Company with related parties. |
| || ||Reviewing with the management the performance of statutory auditors internal auditors adequacy of internal control systems etc. |
|2. Nomination and Remuneration Committee ||Sri Sudhakar Kudva (C) ||The committee oversees and administers executive compensation operating under a written charter adopted by the Board of Directors. |
| ||Sri Satyanarayana Kanumuru Raju (M) || |
| ||Sri Krishna Rao S V Gadepalli (M) ||The nomination and remuneration committee has framed the nomination and remuneration policy. |
|3. Corporate Social Responsibility Committee ||Sri Sudhakar Kudva (C) ||To formulate and recommend to the Board a Corporate Social Responsibility (CSR) Policy indicating activities to be undertaken by the Company in compliance with provisions of the Companies Act 2013 and rules made there under. To monitor the implementation of the CSR Policy of the Company from time to time |
| ||Sri Chandra Sekhar Singavarapu (M) || |
| ||Smt Lalitha Sree Singavarapu (M) || |
|4. Stakeholders Relationship Committee ||Sri Krishna Rao S V Gadepalli (C) ||The committee reviews and ensures redressal of investor grievances. |
| ||Sri Sudhakar Kudva (M) || |
| ||Sri Singavarapu Chandrasekhar (M) ||The committee noted that all the grievances of the investors have been resolved during the year. |
|5. Risk Management Committee ||Sri Sudhakar Kudva (C) ||Framing implementing and monitoring the risk management framework of the Company; Identification prioritization mitigation and monitoring of the risk reported. Periodical review and assessing the quality integrity and effectiveness of the risk management system. |
| ||Sri Krishna Rao S V Gadepalli (M) || |
| ||Dr G Aruna (M) || |
C- Chairperson M- Member Policies
The SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 mandated the formulation of certain policies for all listed companies. All thecorporate policies are available on the Company's website (www.bhagirad.com). The policiesare reviewed periodically by the Board and updated based on need and new compliancerequirement.
In addition to its Code of Conduct and Ethics key policies that havebeen adopted by the Company are as follows:
|Name of the policy ||Brief description ||Weblink |
|Whistle-blower Policy (Policy on vigil mechanism) ||The Company has adopted the whistleblower mechanism for directors and employees to report concerns about unethical behavior actual or suspected fraud or violation of the Company's code of conduct and ethics. It also provides for adequate safeguards against victimization of employees who availed the mechanism and also provides for direct access to the Chairperson of the Audit Committee. ||https://www.bhagirad.com/corporate.html |
|The Code of Conduct for prevention of Insider Trading and Code of fair disclousure of unpublished price sensitive information ||The Company has adopted a Code of Conduct to Regulate Monitor & Report Trading by Insiders and Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information as per the SEBI (Prohibition of Insider Trading) Regulation 2015 with a view to regulate trading in securities by the Directors and Designated Persons while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed and other certain situations. All Board of Directors and the designated employees have confirmed compliance with the Code. || |
|Nomination and Remuneration Policy ||This policy formulates the criteria for determining qualifications competencies positive attributes and independence for the appointment of a director (executive / non-executive) and also the criteria for determining the remuneration of the directors key managerial personnel and senior management of the Company. || |
|Corporate Social Responsibility Policy ||The policy outlines the Company's strategy to bring about a positive impact on Society through programs relating to hunger poverty education healthcare environment etc. as per the provisions of the Companies Act 2013. || |
|Related Party Transaction Policy ||The policy regulates all transactions between the Company and its related parties || |
|Policy on Preservation of Documents ||The policy deals with the preservation of corporate records of the Company. || |
|Policy on Determination of Materiality of Events ||The Policy is to determine materiality of events or information relating to the Company and to ensure timely and accurate disclosure on all material matters concerning the Company. || |
|Risk Management Policy ||This Policy is to identify and manage threats that could severely impact organization establish process for the management of risks faced by the organization and establish effective system of risk identification analysis evaluation and treatment within all areas and all levels; || |
|Archival Policy ||The policy deals with the retention and archival of corporate records of the Company. || |
|Business Responsibility Policy ||This Policy is based on principles laid down in the National Voluntary Guidelines on Social Environmental and Economic responsibilities of a Business published by the Ministry of Corporate Affairs towards conducting business by a company. || |
|Policy for Determining Material Subsidiaries ||This policy is framed as per requirement of SEBI (Listing Obligation and Disclosure Requirements) Regulation 2015 and intended to ensure that Board of Directors has overall supervision of functioning of Subsidiaries of the Company. || |
|Policy on Board Diversity ||The Company recognizes and embraces the benefits of having a diverse Board of Directors and sees increasing diversity at Board level as an essential element in maintaining a competitive advantage in the complex business that it operates. || |
|Dividend Distribution Policy ||This Policy endeavors for fairness consistency and sustainability while distributing profits to the shareholders || |
|Policy on Prohibition of Sexual Harassment ||The policy is designed to take effective measures to avoid and to eliminate and if necessary to impose punishment for any sexual harassment at workplace. || |
|Code of Conduct for the Directors and Senior Management ||Code of conduct for the directors and senior management for discharging their duties with due diligence and care || |
Subsidiaries Associates and Joint Ventures
During the year under review the company has one Wholly OwnedSubsidiary Company namely M/s. Bheema Fine Chemicals Private Limited (CINU24299TG2020PTC142050).
During the year the Board of Directors reviewed the affairs of thesubsidiary. The subsidiary is in its nascent stage and yet to commence commercialoperations. The audited consolidated financial statement of the Company prepared inaccordance with the applicable Accounting Standards along with all relevant documents andthe Auditors' Report forms part of this Annual Report.
No other Company is an associate/joint venture of the Company as on 31stMarch 2022.
A statement containing the highlights of performance of the WhollyOwned Subsidiary is given in Form AOC-1 annexed as Annexure I of this report (which alsoforms part of the Financial Statements)
The gist of financial performance of the Subsidiary Company is asfollows.
| ||Rs. In Lakhs |
|Particulars ||31/03/2022 |
|Total Income ||- |
|Total Expenses ||13.35 |
|Profit/ (Loss) before tax ||(13.35) |
|Tax expense Reversal of taxes of earlier years ||- |
|Current tax expense ||- |
|Deferred tax benefit ||- |
|Profit/ (loss) for the year ||(13.35) |
Revision of Financial Statements
There was no revision of Financial Statements (Standalone &Consolidated) and Board Reports during the year under review except that the financialfigures are presented in lakhs for the financial year 2021-22 and the figurescorresponding to the previous year are also presented in lakhs.
Transactions with the Related Parties
The particulars of contracts or arrangements with related parties asper Section 188 of the Companies Act 2013 and clause (h) of sub-section (3) of section134 of the Act and Rule 8(2) of the Companies (Accounts) Rules 2014 and rules madethereof and as per the Related Party Transaction (RPT) policy of the Company during thefinancial year ended March 31 2022 in prescribed Form AOC-2 are annexed to this Board'sReport at Annexure-II.
Further there are no materially significant related party transactionsduring the year under review with Promoters Directors Key Managerial Personnel and theirrelatives which may have potential conflict with interest of the company at large. Therelated party transactions were placed before the audit committee and the Board at theirrespective meetings for approval. All related party transactions entered during the yearwere in the ordinary course of business and on arm's length basis. The details of therelated party transactions during the year are part of the financial statements formingpart of this Annual Report.
The Audit Committee comprises of four members. The Committee is chairedby Sri. Sudhakar Kudva Non-Executive Independent Director. The Committee comprises ofmajority of Independent Directors. Details of the role and responsibilities of the AuditCommittee the particulars of Meetings held and attendance of each Member at such Meetingsare given in the Report on Corporate Governance which forms part of this Annual Report.
There were no instances of any disagreement between the Committee andthe Board and all recommendations of the Audit Committee made during the year under reviewwere accepted by the Board.
Auditors and Auditors' Report
M/s. S. Singhvi & Co. Chartered Accountants Hyderabad (FRN.003872S) were appointed as the statutory auditors of the company at the 24thAnnual General Meeting held on 26th September 2017 for a period of five yearsviz. from the conclusion of the 24th Annual General Meeting(AGM) till theconclusion of 29th Annual General Meeting of the company.
The Board of Directors of the Company at its meeting held on May 262022 on the Recommendation of the Audit Committee made its recommendation to the membersfor appointment of M/s. R. Kankaria & Uttam Singhi. Chartered Accountants (FRN:000442S) 6-3-1090/C-4 Raj Bhavan Road Somajiguda Hyderabad 500082 as the StatutoryAuditors of the Company for a term of 5 consecutive years i.e. after the conclusion of 29thAnnual General Meeting till the conclusion of 34th Annual General Meetingsubject to the approval of the shareholders in the ensuing Annual general Meeting pursuantto Section 139 of the Companies Act 2013 and rules made thereunder as amended from timeto time at a remuneration to be decided by the Board of Directors of the company fromtime to time.
Accordingly a resolution proposing the appointment of M/s. R.Kankaria & Uttam Singhi. Chartered Accountants (FRN: 000442S) 6-3-1090/C-4 RajBhavan Road Somajiguda Hyderabad 500082 as the Statutory Auditors of the Company for aterm of 5 consecutive years i.e. from the conclusion of 29th Annual GeneralMeeting till the conclusion of 34th Annual General Meeting pursuant to Section139 of the Companies Act 2013 and rules made thereunder as amended from time to time ata remuneration to be decided by the Board of Directors of the company from time to timeforms part of the Notice of the 29th Annual General Meeting of the Company.
The Company has received a written consent from M/s. R. Kankaria &Uttam Singhi Chartered Accountants to act as Statutory Auditors of the company and acertificate dated 7th May 2022 stating that:
a) The firm is eligible for appointment and is not disqualified forbeing appointed as auditors for a period of five years after the conclusion of the 29thAGM in FY 2022-2023 till the conclusion of the 34th AGM in FY 2027- 2028under the Companies Act 2013 the Chartered Accountants Act 1949 & the rules ofregulations made thereunder.
b) The proposed appointment is as per the term provided under theCompanies Act 2013.
c) The proposed appointment is within the limits laid down by / underthe authority of Companies Act 2013; and
d) There is no order or pending proceedings relating to professionalmatters of conduct against the firm before the Institute of Chartered Accountants of Indiaor any competent authority or any court
The Statutory Audit Report for FY 2021-22 given by M/s. S. Singhvi& Co. Chartered Accountants (FRN. 003872S) Statutory Auditors on the financialstatement of the Company for the Financial year 2021-22 is forming part of the AnnualReport. The Auditors' report does not contain any qualification reservation or adverseremark.
As per Section 148 of the Act read with the Companies (Cost Recordsand Audit) Rules 2014 as amended from time to time the cost records are required to beaudited. Based on the recommendation of the Audit Committee your Board has appointed M/s.Sagar & Associates Cost Accountants Hyderabad as cost auditors for the financialyear 2022-23. A resolution seeking Member's ratification for the remuneration payable tothe Cost Auditor is being placed for members' approval in this Annual General Meeting.
A Certificate from M/s. Sagar & Associates Cost AccountantsHyderabad has been received to the effect that their appointment as Cost Auditor of theCompany would be in accordance with the limits specified under Section 141 of the Act andRules framed thereunder.
The Secretarial Audit Report issued by M/s RPR & AssociatesPracticing Company Secretaries Vengala Rao Nagar E-seva lane S. R. Nagar Hyderabad500038 for the FY 2021-22 does not contain any qualification reservation or adverseremark. The Secretarial Audit Report in Form MR-3 received from them is annexed herewithas Annexure III (A).
In terms of Regulation 24(A) of the SEBI (Listing Obligation andDisclosure Requirements) Regulation 2015 the Company has obtained the SecretarialCompliance certificate for FY 2021-22 from Mr. Y. Ravi Prasada Reddy (M. No: FCS 5783 CPNo: 5360) Proprietor of M/s RPR & Associates Practicing Company Secretaries which isannexed as Annexure-III(B) and forms part of the Annual Report. The same was alsofiled with the Stock Exchanges where the shares of the Company are listed.
Pursuant to Regulation 34(3) and Schedule V Para C clause (10) (i) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the companyhas obtained a certificate from Mr. Y. Ravi Prasada Reddy (M. No: FCS 5783 CP No: 5360)Proprietor of M/s RPR & Associates Practicing Company Secretaries which is annexed asAnnexure-III (C).
Pursuant to Section 204 of the Act read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board based onthe recommendation of the Audit Committee appointed Mr. Y. Ravi Prasada Reddy (M. No: FCS5783 CP No: 5360) Proprietor of M/s RPR & Associates Practicing CompanySecretaries Vengala Rao Nagar E-seva lane S. R. Nagar Hyderabad 500038 as theSecretarial Auditor of the Company for the Financial Year 2022-23 to undertake thesecretarial audit for the financial year 2022-23.
Reporting of Fraud
During the year under review the Statutory Auditors Cost Auditors andSecretarial Auditors have not reported any instances of frauds committed in the Company byits Officers or Employees to the Audit Committee under Section 143(12) of the Actdetails of which were not required to be mentioned in this Report.
CARE Rating has upgraded the credit rating to BBB stable for long termand CARE A3 for short term borrowings of the Company from banks during the year underreview.
Corporate Social Responsibility (CSR)
The Company's CSR activities are focused on supporting socially usefulprograms for the welfare & Sustainable development of the society. A brief outline ofthe Corporate Social responsibility (CSR) policy of the Company and the initiatives takenby the Company on CSR activities during the year under review are set out in Annexure-IVof this report in the format prescribed in the Companies (Corporate Social ResponsibilityPolicy) rules 2014. The Company's CSR efforts included COVID-19 relief activities.
Particulars of Employees
Disclosures pertaining to remuneration and other details as requiredunder Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 (Rules') are enclosed asAnnexure-V to this Report.
Your company believes that competent and committed human resources arevitally important to attain success in the organisation. In line with this philosophyutmost care is being exercised to attract quality resources and suitable training isimparted on various skill-sets and behaviour. Various initiatives were undertaken toenhance the competitive spirit and encourage bonding teamwork among the employees evenduring the COVID-19 pandemic outbreak which have ensured uninterrupted operations andachievement of the targeted growth of the Company.
Significant Material Orders Passed by the Regulators
There were no significant material orders passed by anyRegulators/Courts that would impact the going concern status of the Company and its futureoperations.
Proceeding under Insolvency and Bankruptcy Code 2016
There are no proceedings either filed by the Company or against theCompany pending under the Insolvency and Bankruptcy Code 2016 as amended before theNational Company Law Tribunal or other Courts as on 31 March 2022.
Director's Responsibility Statement as required under Section 134(3)(c) & (5) of the Companies Act 2013.
Pursuant to the requirement under Section 134 (3)(c) & (5) of theCompanies Act 2013 your Directors confirm as under:
a) In the preparation of the annual accounts the applicable accountingstandards read with requirements set out under Schedule III to the Companies Act 2013have been followed and there are no material departures from the same.
b) The Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of your Company at the end of thefinancial year ended 31st March 2022.
c) The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities.
d) The Directors have prepared the annual accounts on a goingconcern' basis.
e) The Directors have laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate andoperating effectively.
f) The Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
Extract of the Annual Return
The Annual Return as on March 31 2022 as required under Section 92(3)and Section 134(3) (a) of the Companies Act 2013 is available on the Company's websiteat https:// www.bhagirad.com/.
Nomination and Remuneration Policy
The Board has on the recommendation of Nomination and RemunerationCommittee framed a policy for selection and appointment of Directors Senior ManagementPersonnel and their remuneration. The Nomination and Remuneration Policy adopted by theBoard is available on the Company's website at http://www.bhagirad.com
Procedure for Nomination and Appointment of Directors
The Nomination and Remuneration Committee (NRC) has been mandated tooversee and develop competency requirements for the Board based on the industryrequirements and business strategy of the Company. The NRC reviews and evaluates theprofiles of potential candidates for appointment of Directors. Specific requirements forthe position including expert knowledge expected are communicated to the appointee.
On the recommendation of the NRC the Board has adopted and framed aRemuneration Policy for the Directors Key Managerial Personnel and other employeespursuant to the applicable provisions of the Act and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (the Listing Regulations). Theremuneration determined for Directors is subject to the recommendation of the NRC andapproval of the Board of Directors.
The Executive Directors are not paid sitting fees; however theNon-Executive Directors are entitled to sitting fees for attending the Board / CommitteeMeetings.
It is affirmed that the remuneration paid to Directors Key ManagerialPersonnel and all other employees are in accordance with the Remuneration Policy of theCompany.
Evaluation of the Board
As per the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 as amended from time to timethe Nomination and Remuneration Committee laid down criteria for performance evaluation ofindividual director(s) the board and its committee(s) as a whole. Accordingly the Boardhad carried out an annual evaluation of the Directors individually and of the Board andits Committee as a whole.
A structured questionnaire was prepared after taking intoconsideration inputs received from the Directors covering aspects of the Board'sfunctioning such as adequacy of the composition of the Board and its committees executionand performance of specific duties obligations and governance.
A separate exercise was carried out to evaluate the performance ofIndividual Directors including the Chairman of the Board. The performance of the Directorswas evaluated on parameters such as level of engagement and contribution in safeguardingthe interest of the Company etc.
Familiarization Programme for Independent Directors
Your Company follows a well-structured induction programme fororientation and training of Directors at the time of their joining to provide them with anopportunity to familiarise themselves with the Company its management its operations andthe industry in which the Company operates.
A handbook covering the role functions duties and responsibilitiesand the details of the compliance requirements expected from the Directors under the Actand relevant Regulations of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 were given and explained to the Directors as and when required.
The newly appointed Directors are informed about the Company's VisionCore purpose Core Values and Business operations. In addition detailed presentations aremade by Senior Management Personnel on performance of the Company at every Board Meeting.
Particulars of loans guarantees and investments
The Company has extended unsecured loan of an amount of Rs. 105 lakhsat an interest rate of 8.5% p.a to its wholly owned subsidiary Company namely M/s. BheemaFine Chemicals Private Limited during this year (the outstanding as on March 31 2022 wasRs. 40.49 lakhs)
The company has made investment of an amount of Rs. 99 lakhs bysubscribing to the equity share capital of M/s. Bheema Fine Chemicals Private Limited itsWholly Owned Subsidiary Company.
Loans guarantees and investments covered under Section 186 of theCompanies Act 2013 form part of the notes to the standalone and consolidated financialstatements provided in this Annual Report.
Apart from the above the Company has not given any loans guarantees orsecurity in connection with loans or made any investments falling within the ambit ofSection 186 of the Companies Act 2013 read with rules made thereunder as amended fromtime to time.
A strong internal control framework sets the tone and serves as thefoundation for the implementation of corporate governance policies and guidelines. YourCompany has well-defined internal audit & control systems which are adequatelymonitored. These have been designed to provide reasonable assurance with regard torecording and providing reliable financial and operational information complying withapplicable accounting standards and relevant statutes safeguarding assets fromunauthorised use executing transactions with proper authorisation and ensuring complianceof corporate policies. The Internal control systems are improved and modified continuouslyto meet the changes in business conditions statutory and accounting requirements.
The Audit Committee of the Board of Directors and Statutory Auditorsare periodically apprised of the internal audit findings and corrective actions taken. TheAudit Committee of the Board of Directors reviews the adequacy and effectiveness ofinternal control system and suggest improvements if any for strengthening them.
During the year the company had constituted the Risk ManagementCommittee pursuant to Section 134 (3) (n) of the Companies Act 2013 & Regulation 21of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.
The Committee will periodically review and asses the quality integrityand effectiveness of the risk management
system. During the period under review the Audit Committee and theBoard reviewed the elements of risk and the steps taken to mitigate the risks. In theopinion of the Board there are no major elements of risk which have the potential ofthreatening the existence of the Company.
Deposits from Public
The Company has not accepted any deposits from the public fallingwithin the ambit of Sections 73 and 74 of the Act read with the Companies (Acceptance ofDeposits) Rules 2014 during the year under review. There are no outstanding deposits ason 31st March 2022.
Conservation of energy Technology absorption Foreign Exchangeearnings & outgo
The information on conservation of energy technology absorption andforeign exchange earnings and outgo stipulated under Section 134(3)(m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 is annexed herewith asAnnexure - VI.
Business Responsibility Report
The Business Responsibility Report' (BRR) of your Company for theyear ended 31 March 2022 forms part of this Annual Report as required under Regulation34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015as Annexure-VII to the board report
The report on corporate governance for the year ended 31st March2022 pursuant to Regulation 34 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 is annexed hereto as Annexure VIII. The certificate frompracticing Chartered Accountant pursuant to the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 regarding thecompliance of conditions of corporate governance is attached to the report on corporategovernance.
Prevention of the Sexual Harassment of Women at workplace
The Company has in place an appropriate Policy on Prevention of SexualHarassment of Women at Workplace in accordance with the provisions of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. ThePolicy aims to provide protection to employees at workplace and prevent and redresscomplaints of sexual harassment and of matters connected or incidental thereto with theobjective of providing a safe working environment where employees feel secure. Thecompany is intolerant to any discrimination and harassment related issues and takes timelymeasures to address the grievance. The company has complied with provisions relating tothe constitution of Internal Complaints Committee under the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013
During the financial year 2021-22 no complaints were received in thisregard.
Indian Accounting Standards (Ind AS)
The Company has adopted Indian Accounting Standards (Ind AS) witheffect from April 1 2017 pursuant to Ministry of Corporate Affairs' notification of theCompanies (Indian Accounting Standards) Rules 2015. The standalone and consolidatedfinancial statements of the Company forming part of the Annual Report have been preparedand presented in accordance with all the material aspects of the Indian AccountingStandards (Ind AS') as notified under section 133 of the Companies Act 2013 readwith the Companies (Indian Accounting Standards) Rules 2015 (by Ministry of CorporateAffairs (MCA')) and relevant amendment rules issued thereafter and guidelines issuedby the Securities Exchange Board of India ("SEBI").
During the FY 2021-2022 the Company has complied with applicableSecretarial Standards issued by the Institute of Company Secretaries of India.
CEO & CFO Certification
Pursuant to the Regulation 17(8) of SEBI (LO&DR) Regulation 2015the company has obtained certificate signed by Sri A Arvind Kumar Chief Executive Officerand Sri. B Krishna Mohan Rao Chief Financial Officer of the Company certifying theaccuracy of the Financial Statements for FY 2021-22 which forms part of this report.
Pursuant to the Regulation 33 (2) (a) of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 the company has obtained certificatesigned by Sri A Arvind Kumar Chief Executive Officer and Sri. B Krishna Mohan Rao ChiefFinancial Officer certifying that the financial results for the FY 2021-22 do not containany false or misleading statement or figures and do not omit any material fact which maymake the statements or figures contained therein misleading which forms part of thisreport.
Prevention of Insider Trading Code
Pursuant to SEBI (Prohibition of Insider Trading) Regulations 2015 asamended the Company has adopted the Code of Conduct for Prevention of Insider Trading andCode of Practices and Procedures for Fair Disclosure of Unpublished price Sensitiveinformation copies of the same are available on company's website at https:/www.bhagirad.com/corporate.html
Vigil Mechanism / Whistle Blower Policy
The Vigil Mechanism as envisaged in the Companies Act 2013 the Rulesprescribed thereunder the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is implemented through the Company's Whistle Blower Policy.
The Company has adopted a Whistle Blower Policy establishing a formalvigil mechanism for the Directors and employees to report concerns about unethicalbehaviour actual or suspected fraud or violation of Code of Conduct and Ethics. It alsoprovides for adequate safeguards against the victimization of employees who avail of themechanism and provides direct access to the Chairperson of the Audit Committee.
It is affirmed that no personnel of the Company have been denied accessto the Audit Committee. The Whistle Blower Policy is available on the Company's website athttps://www.bhagirad.com/corporate.html.
Research & Development
R&D is an integral part of our business strategy and our Companyconsistently leveraged its R&D proficiency in implementing agile practices whichhelped our Company to adapt to various business challenges and in meeting the expectationsof the customers. We believe that augmenting our R&D capabilities will be vital to ourgrowth plans and developed processes.
All the processes implemented in the manufacture of different productshave been developed in-house. The R&D teams incessantly work on optimizing existingmanufacturing processes for reduction in cost of manufacturing and minimization of wasteand intellectual property development
Health Safety and Environment protection
Your Company is environmentally conscious and believes in protectingthe environment and building a sustainable society. It is committed to promoting healthierlives contributing to the Communities where it operates. It accords highest priority tothe health and safety of its employees customers and other stakeholders as well as to theprotection of the environment. Making operations safe and secure by developing adequateoperating procedures safety focused culture and improving equipment are accorded utmostpriority.
Statements in this Report particularly those which relate toManagement Discussion and Analysis Corporate Governance Report describing the Company'sobjectives projections estimates and expectations may constitute forward lookingstatements' within the meaning of applicable laws and regulations. Actual results mightdiffer materially from those either expressed or implied in the statement depending on thecircumstances.
Your Directors wish to record appreciation to the continued support andcooperation from its customers suppliers vendors trade partners and all othersassociated with it. Your Company will continue to build and maintain a strong associationwith its business partners and trade associates. During the year under review industrialrelations remained cordial and stable. The directors wish to place on record their sincereappreciation of the cooperation received from employees at all levels.
Your Directors wish to express their gratitude towards the Shareholdersfor their continued trust support and confidence. Your Directors also wish to conveytheir sincere gratitude to the Company's business partners customers vendors and thebankers who stood by the company at all times. Your Directors place on record theirappreciation towards the contribution made by the employees at all levels. The Company'sconsistent growth was made possible by their hard work solidarity cooperation andsupport.