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Bluechip Tex Industries Ltd.

BSE: 506981 Sector: Industrials
NSE: N.A. ISIN Code: INE472D01017
BSE 00:00 | 04 Oct 134.95 2.95






NSE 05:30 | 01 Jan Bluechip Tex Industries Ltd
OPEN 126.30
52-Week high 203.00
52-Week low 110.30
P/E 8.68
Mkt Cap.(Rs cr) 27
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 126.30
CLOSE 132.00
52-Week high 203.00
52-Week low 110.30
P/E 8.68
Mkt Cap.(Rs cr) 27
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Bluechip Tex Industries Ltd. (BLUECHIPTEXIND) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the 36th Annual Report of Blue ChipTex Industries Limited ("the Company") along with the Audited FinancialStatements for the Financial Year ended 31st March 2021.


The financial performance of your Company for the financial year ended 31stMarch 2021 is summarized below:

Rs in lakhs

particulars Financial Year Financial Year
2020-21 2019-20
Revenue from Operations 15613.21 22184.73
Other Income 28.54 27.47
total Income 15641.75 22212.20
Expenses except depreciation & amortization expense 15138.45 21173.71
Depreciation & amortization expense 254.16 277.03
total expenses 15392.61 21450.74
Profit before depreciation & amortization expense 503.30 1038.49
Less: Depreciation & amortization expense 254.16 277.03
Profit before Tax 249.14 761.46
less: provision for taxation
Current tax 62.00 173.09
Deferred tax 5.72 (19.50)
MAT Credit Entitlement - 26.33
Profit after tax 181.42 581.54
other Comprehensive income (1.11) (1.90)
total income for the year 180.31 579.64
earnings per share (in Rs) (Basic and Diluted) 9.21 29.51
Amount transferred to Retained earnings 181.42 581.54
transfer to General Reserve



The above mentioned financial performance highlights are an abstract of the FinancialStatements of your Company for the Financial Year 2020-21. The detailed FinancialStatements forms part of this Annual Report and are also uploaded on website of yourCompany i.e.

1. performance highlights:

The revenue from operations for the financial year 2020-21 was Rs15613.21 lakhs lowerby 29.62 % over the previous year's revenue from operations of Rs 22184.73 lakhs infinancial year 2019-20. The Profit after tax for the financial year 2020-21 was Rs 181.42lakhs as compared to Rs 581.54 lakhs in financial year 2019-20.

2. CoVID-19 and its impact:

As the COVID-19 pandemic continues and sudden spread of second wave of Corona Virus allover India the Government of various States including the Central Government has issuedvarious norms and directives. Also there were partial or complete Lock-down enforced byvarious State Government(s). During the Financial Year 2020-21 COVID-19 has brought aneconomic slowdown and to avoid its further spread the Government in many States haddeclared closure of manufacturing units factories etc. Since the overall economy was hitbecause of the sudden outbreak of COVID - 19 it impacted the overall business of yourCompany. Wherever possible and based on the Government Orders / Advisories theManufacturing Units were resumed to ensure continued supplies of Company's products.

To break the chain of COVID-19 various steps have been taken by your Company includingcreating awareness in employees to maintain hygiene by cleaning the hands at regularintervals using the facial mask to avoid the spread of COVID-19 Work From Home facilityis still in force use of Hand Sanitizers kept at entry point in the Office premiseschecking of Body Temperature etc.

3. Dividend:

Your Directors are pleased to recommend a final dividend of Rs 3.00/- per equity shareof Rs 10/- each for the Financial Year ended 31st March 2021.

In accordance with the provisions of the Income Tax Act 1961 as amended by and readwith the provisions of the Finance Act 2020 with effect from 1 st April2020 dividend declared and paid by any Company is taxable in the hands of shareholders.Your Company shall therefore be required to regulate deduction of tax at source (TDS) atthe time of payment of dividend in accordance with the provisions of the Income Tax Act1961 read with the Finance Act 2020 and at the applicable rates of taxes. The TDS ratemay vary depending upon the residential status of the shareholder and the documentssubmitted to your Company.

Your Company will also be sending communication to the shareholders informing them tosubmit the necessary documents to enable your Company to calculate the amount of taxrequired to be deducted from the proposed dividend in respect of each eligibleshareholders. The aforesaid communication will be sent to those shareholders whose nameappears in the Register of Members as on 6th August 2021 via email to thoseshareholders who have registered their email id with your Company and for shareholders whohave not registered their email addresses through courier/ post at their latestregistered address available with your Company.

4. transfer to Reserves:

Your Company did not transfer any sum to the General Reserve for the Financial Yearunder review.

5. Annual Return:

As per the requirements of Section 92(3) of the Companies Act 2013 and Rules framedthereunder the copy of the Annual Return for the financial year 2020-21 is uploaded onthe website of the Company and the same is available

6. Details of Frauds reported by the Auditors under Section 143(12) of Companies Act2013:

There are no frauds reported by the Auditor which are required to be disclosed underSection 143(12) of Companies Act 2013.

7. Board Meetings:

The Board met four times through video conferencing during the financial year 2020-21on 29th June 2020 19th August 2020 12th November2020 and 29th January 2021. The necessary quorum was present for all themeetings. The maximum interval between any two meetings did not exceed 120 days. Also theBoard of Directors of your Company passed a resolution by circulation on 14thJuly 2020 10th August 2020 11th August 2020 21stSeptember 2020 8th October 2020 and 29th December 2020.

8. Changes in Directors and Key Managerial personnel:

The following changes in Directors & Key Managerial Personnel has taken placeduring the year under review:

1. The Board at its meeting held on 19th August 2020 approved theappointment of Mr. Shahin .N. Khemani as Managing Director of the Company for a period offive years with effect from 1st September 2020 and later the appointment wasapproved by the shareholders at 35th Annual General Meeting of the Company.

2. Mr. Ashok .K. Khemani resigned from the Board of the Company with effect from theclose of business hours on 31 st August 2020.

3. Shareholders at the 35th Annual General Meeting approved the appointmentof Mr. Shatrughun .N. Jiwnani as Non-Executive Independent Director of the Company for aperiod of four years with effect from 6th January 2020.

4. Shareholders at the 35th Annual General Meeting approved the appointmentof Mr. Rohit .P. Bajaj as Non-Executive Independent Director of the Company for a periodof three years with effect from 6th January 2020.

5. Shareholders at the 35th Annual General Meeting approved the appointmentof Mr. Siddharth .A. Khemani as a Non-Executive Non-Independent Director of the Companywith effect from 1st October 2020.

9. Independent Directors:

All the Independent Directors of the Company have given their declarations to theCompany under Section 149(7) of the Companies Act 2013 that they meet the criteria ofindependence as provided under Section 149(6) of the Companies Act 2013. Also all theIndependent Directors of your Company have complied with the provisions of sub rule (1)and (2) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules2014.

During the year under review the Company did not have any pecuniary relationship ortransactions with any of its Independent Directors other than payment of sitting fees.

In the opinion of the Board the Independent Directors of the Company meet therequirements of integrity expertise and experience as required by Company and have theProficiency required for their appointment as an Independent Director on the Board of theCompany.

10. particulars of Remuneration to Directors and employees:

The statement containing information as required under the provisions of Section197(12) of the Companies Act 2013 read with Rule 5(1) Rule 5(2) and Rule 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexedherewith as "Annexure - IV".

11. Auditors:

(i) Statutory Auditor

The Members at the 32nd Annual General Meeting of the Company held on 29thAugust 2017 had appointed M/s. D K P & Associates Chartered Accountants (FirmRegistration No. 126305W) as the Statutory Auditor of the Company to hold office for aterm of five years i.e. from the conclusion of the 32nd Annual General Meetinguntil the conclusion of the Annual General Meeting to be held in the year 2022. TheCompany has received a written confirmation from the Statutory Auditors that theircontinued appointment shall be in accordance with the criteria as provided under Section141 of the Companies Act 2013 read with Rule 4 of the Companies (Audit and Auditors)Rules 2014. The Notes on financial statements referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification(s) reservation(s) or adverse remark(s).

(ii) Secretarial Auditor

In terms of Section 204 of the Companies Act 2013 the Board of Directors of yourCompany on the recommendation of the Audit Committee have re-appointed M/s. Pramod .S.Shah and Associates Practicing Company Secretaries to undertake the Secretarial Audit ofthe Company for the financial year 2020-21. The Secretarial Audit Report issued in thisregard is annexed as "Annexure I". The report does not contain anyqualification(s) reservation(s) or adverse remark(s) which calls for any explanation fromyour Board of Directors.

(iii) Cost Auditor

In terms of the provisions of Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Rules 2014 as amended from time to time the Board ofDirectors based on the recommendation of the Audit Committee have re-appointed M/s. NKJ& Associates Practising Cost Accountants Mumbai (Registration No. 101893) as CostAuditor of the Company for conducting the Cost Audit for the Financial Year 2021-22 on aremuneration as mentioned in the Notice of 36th Annual General Meeting. ACertificate from M/s. NKJ & Associates Practising Cost Accountants has been receivedto the effect that their appointment as Cost Auditor of the Company if made would be inaccordance with the limits specified under Section 141 of the Act and Rules framedthereunder. A resolution seeking Member's ratification for the remuneration payable to theCost Auditor forms part of the Notice of 36th Annual General Meeting and thesame is recommended for your consideration and ratification. The Cost Audit Report for thefinancial year ended 31st March 2021 does not contain any qualification(s)reservation(s) or adverse remark(s) which calls for any explanation from your Board ofDirectors.

(iv) Internal Auditor

In terms of the provisions of Section 138 of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 as amended from time to time the Board of Directorsbased on the recommendation of the Audit Committee have re-appointed M/s. Raju Gupta& Associates Chartered Accountants Mumbai (Registration No. 108477W) as theInternal Auditor of the Company for the Financial Year 2020-21. The Internal Audit Reportfor the financial year ended 31st March 2021 does not contain anyqualification(s) reservation(s) or adverse remark(s) which calls for any explanation fromyour Board of Directors.

12. Conservation of energy technology Absorption and Foreign exchange earnings andoutgo as per Section 134 (3) (m) of the Companies Act 2013 read with Rule 8 (3) of theCompanies (Accounts) Rules 2014:

A. Conservation of energy:

(i) the steps taken or impact on conservation of energy:

Constant efforts in continuing all previous conservation measures and increasingawareness of energy management amongst employees have continued which should enablefurther savings going forward. The Company had installed solar plant for energyconservation in March 2020. Also Company had installed LED lights in place of existinglighting system in March 2020. Installation of solar plant and LED lights helped inreducing the energy bill and creating higher productivity.

(ii) the steps taken for utilizing alternate sources of energy:

The Company had installed solar plant for energy conservation in March 2020. AlsoCompany had installed LED lights in place of existing lighting system in March 2020.

(iii) the capital investment on energy conservation equipment:

The Company invested Rs 50.63 lakhs towards above installation.

B. technology absorption:

(i) the efforts made towards technology absorption:

The Textile business environment is becoming more and more challenging and competitivethus in current scenario it becomes the key to survival. We follow strategy of Innovationand Sustainability and research is being done to keep business predictable sustainableand profitable and to de-risk our product portfolio.

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

The Company keeps itself abreast of the technical development and innovation in itsline of products and tries to bring improvements in the product for better yield qualityand cost effectiveness etc. Continuous efforts are being made in the areas of qualityimprovements waste reduction process capability and cost minimization to speciallyimprove the market acceptance of the product.

(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: Not Applicable

(b) the year of import: Not Applicable

(c) whether the technology been fully absorbed: Not Applicable

(d) if not fully absorbed areas where absorption has not taken place and the reasonsthereof: Not Applicable

(iv) the expenditure incurred on Research and Development - NIL

C. Foreign exchange earnings and outgo: NIL

13. Material Changes and Commitment if any affecting the financial position of theCompany from the end of the financial year till the date of this report:

Except as disclosed elsewhere in this report no material changes and commitments whichcould affect your Company's financial position have occurred between the end of thefinancial year 2020-21 and to the date of this report.

14. Significant and Material Orders passed by the Regulators / Courts / Tribunals:

There are no significant or material orders passed by the regulators or courts ortribunals impacting the going concern status and the company's operation in future.

15. Details of Subsidiary Company / Associate Company / Joint Ventures:

Company does not have any Subsidiary Company or Associate Company or Joint Venture.

16. Change in the nature of Business:

There has been no change in the nature of business of the Company during the year ended31st March 2021.

17. Change in the Capital Structure:

There has been no change in the capital structure of the Company during the year ended31 st March 2021.

18. Accounting treatment:

The Company followed the applicable Accounting Standards in the preparation of itsFinancial Statements.

19. Compliance with the applicable Secretarial Standards:

The Company has complied with the applicable secretarial standards for the financialyear 2020-21.

20. Adequacy of Internal Financial Controls with reference to the financial statements:

The Company has adequate and effective control systems commensurate with its size andnature of business to ensure that assets are efficiently used and the interest of theCompany is safe guarded. Checks and balances are in place to determine the accuracy andreliability of accounting data.

21. Risk Management Committee:

As per Regulation 21 of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulation 2015 the Board of Directors of the top 1000 listedentities needs to constitute a Risk Management Committee. As the Company does not fallsinto the aforesaid category the Board has not constituted Risk Management Committee.

22. particulars of loans Guarantees and Investments:

Company has not provided any loans or guarantees which are covered under the provisionsof Section 186 of the Companies Act 2013. The details of investments covered under theprovisions of Section 186 of the Companies Act 2013 are given in the Notes to theFinancial Statements forming part of Annual Report.

23. Related party transactions:

All Related Party Transactions entered into during the financial year under reviewwere on an arm's length basis and in the ordinary course of business and are incompliance with the applicable provisions of the Act.

Prior omnibus approval of the Audit Committee is obtained for the transactions whichare repetitive in nature or when the need for these transactions cannot be foreseen inadvance. Details of transactions with Related Parties as required under Section 134(3)(h)of the Companies Act 2013 read with Rule 8(2) of the Companies (Accounts) Rules 2014 isannexed herewith as "Annexure II" in form AOC-2.

Disclosure of transactions with related parties as required under the applicableAccounting Standards have been made in the notes forming part of the financial statements.

24. Deposits:

The Company has not accepted any deposits covered under the provisions of the CompaniesAct 2013 and the Rules made thereunder.

25. transfer to Investor education and protection Fund:

transfer of equity Shares: Pursuant to the provisions of Section 124(6) of theCompanies Act 2013 and the Investor Education and Protection Fund Authority (AccountingAudit Transfer and Refund) Rules 2016 notified by the Ministry of Corporate Affairs on 7thSeptember 2016 and subsequently amended vide notification dated 28th February2017 all the equity shares of the Company in respect of which dividend amounts have notbeen paid or claimed by the shareholders for seven consecutive years or more are requiredto be transferred to demat account of the Investor Education and Protection Fund Authority(IEPF).

Accordingly 8000 shares of 57 members of your Company were transferred to DematAccount of IEPF Authority on 23rd October 2020. Your Company had sentindividual notice to all the members whose email ids were available with Company and hasalso published the notice in the leading English and Gujarati newspapers. The details ofthe aforesaid 57 members are available on website of your Company

transfer of unpaid/unclaimed Dividend: Further pursuant to the provisions ofSection 124(5) of the Act the dividend which remained unclaimed/ unpaid for a period ofseven years from the date of transfer to unpaid dividend account is required to betransferred to the IEPF. As a result the unclaimed/ unpaid dividend for the year 2012-13which remained unpaid and unclaimed for a period of 7 years has been already transferredby your Company to the IEPF.

Your Company has uploaded the details of unclaimed/ unpaid dividend for the financialyear 2012-13 onwards on its website viz. and onwebsite of the Ministry of Corporate Affairs viz. and the same getsrevised / updated from time to time.

The unpaid dividend amount pertaining to the financial year 2013-14 will be transferredto IEPF during the Financial Year 2021-22.

26. Committees of Board:

I. nomination and Remuneration Committee:

The Nomination and Remuneration Committee (NRC) has been constituted by the Board incompliance with the requirements of Section 178 of the Companies Act 2013. The NRCconsists of following three non-executive Directors who are Independent Directors as well:

1. Mr. Shatrughun .N. Jiwnani - Chairman

2. Mr. Rohit .P. Bajaj - Member

3. Ms. Shraddha .M. Teli - Member

terms of Reference of nRC: The role and terms of reference of the Committee are inline with the provisions of Section 178 of the Companies Act 2013. The Committee isempowered to do the following:

a. Formulation of the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board of Directors a policy relating tothe remuneration of the directors key managerial personnel and other employees;

b. Formulation of criteria for evaluation of performance of Independent Directors andthe Board of Directors;

c. Identifying persons who are qualified to become Directors and who may be appointedin Senior Management in accordance with the criteria laid down and recommend to the Boardof Directors their appointment and removal;

d. Whether to extend or continue the term of appointment of the Independent Directoron the basis of the report of performance evaluation of Independent Directors;

e. Recommend to the Board all remuneration in whatever form payable to SeniorManagement.

The Company's Nomination and Remuneration Policy for Directors Key ManagerialPersonnel and other employees is annexed herewith as "Annexure V".Further the Company has devised a Policy for performance evaluation of IndependentDirectors Board Committees and other individual Directors & Key ManagerialPersonnel's. The Company's Nomination and Remuneration Policy is directed towardsrewarding performance based on review of achievements periodically. The Nomination andRemuneration Policy is in consonance with the existing industry practice.

II. Audit Committee:

The Audit Committee has been constituted by the Board in compliance with therequirements of Section 177 of the Companies Act 2013. The Audit Committee consists offollowing three Directors with the Chairman being Independent Director.

1. Mr. Shatrughun .N. Jiwnani - Chairman

2. Mr. Rohit .P. Bajaj - Member

3. Mr. Rahul .A. Khemani - Member

terms of Reference of the Audit Committee: The terms of reference of the AuditCommittee of your Company are in accordance with Section 177 and other applicableprovisions of the Companies Act 2013 and the Rules framed thereunder which inter aliainclude the following:

a. Recommendation for appointment remuneration and terms of appointment of auditors ofthe company;

b. Review and monitor the auditor's independence and performance and effectiveness ofaudit process;

c. Examination of the financial statement and limited review / auditors' reportthereon;

d. Approval or any subsequent modification of transactions of the company with relatedparties;

e. Scrutiny of inter-corporate loans and investments;

f. Valuation of undertakings or assets of the company wherever it is necessary;

g. Evaluation of internal financial controls and risk management systems;

h. Discussion with Internal Auditors of any significant findings and follow up thereon;

i. Review the functioning of the Whistle Blower mechanism or Vigil mechanism; etc

III. Stakeholders Relationship Committee:

The Stakeholders' Relationship Committee (SRC) has been constituted by the Board incompliance with the requirements of Section 178 (5) of the Companies Act 2013. The SRCcomprises of following three directors with the Chairman being Independent Director:

1. Mr. Shatrughun .N. Jiwnani - Chairman

2. Mr. Shahin .N. Khemani - Member

3. Mr. Rahul .A. Khemani - Member

The terms of reference of the SRC inter-alia are as follows:

a. Resolving the grievances of the security holders of the Company including complaintsrelated to transfer/ transmission of shares non-receipt of annual report non-receipt ofdeclared dividends issue of new/ duplicate certificates general meetings etc;

b. Review of measures taken for effective exercise of voting rights by shareholders;

c. Review of adherence to the service standards adopted by the Company in respect ofvarious services being rendered by the Registrar & Share Transfer Agent;

d. Review of the various measures and initiatives taken by the Company for reducing thequantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annualreports/ statutory notices by the shareholders of the company;

IV. Corporate Social Responsibility (CSR) Committee:

The Board at its meeting held on Wednesday 4th August 2021 dissolvedCorporate Social Responsibility (CSR) Committee with immediate effect and adopted new CSRPolicy.

Reason for dissolution: Section 135 (9) of the Companies Act 2013 which becameeffective from 22nd January 2021 states that - Where the amount to be spent bya company under subsection (5) does not exceed fifty lakh rupees the requirement undersub-section (1) for constitution of the Corporate Social Responsibility Committee shallnot be applicable and the functions of such Committee provided under this section shallin such cases be discharged by the Board of Directors of such company.

As the CSR obligation of the Company for the financial year 2021-22 is below fifty lakhrupees the Board at its meeting held on Wednesday 4th August 2021 dissolvedthe CSR Committee with immediate effect and adopted new CSR Policy. Now all the functionswhich were discharge by the CSR Committee w.r.t. CSR compliances will be discharged by theBoard of Directors of the Company.

Prior to dissolution the CSR Committee comprised of following three directors:

1. Mr. Shatrughun .N. Jiwnani - Chairman (Independent Director)

2. Mr. Shahin .N. Khemani - Member (Managing Director)

3. Mr. Rahul .A. Khemani - Member (Chief Financial Officer and Director)

The terms of reference of the CSR Committee broadly included the following:

a. Formulate and recommend the Corporate Social Responsibility (CSR) Policy and anyamendments therein to the Board of Directors of the Company;

b. Develop and approve various CSR projects programs and activities to be undertakenfrom time to time either directly by the Company or through other entities;

c. Determine modalities of execution of such CSR projects programs and activities;

d. Undertake all necessary steps to implement the CSR activities;

e. Authorise and approve CSR expenditure from time to time subject to the limitsapproved by the Board of Directors;

f. Monitor the CSR activities in such manner as it deems fit;

g. Carry out all such acts deeds matters and things as may be required in connectionwith aforesaid matters and generally for any matter connected with the CSR policy of theCompany;

h. To perform such functions as may be entrusted by the Board of Directors from time totime.

The new CSR policy and old CSR policy has been posted on the website of the Company The Annual Report on CSR activities in terms of therequirements of Companies (Corporate Social Responsibility Policy) Rules 2014 is annexedherewith as "Annexure III".

27. Whistle Blower policy / Vigil Mechanism:

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to theDirectors' and employees to report their concerns about unethical behaviour actual orsuspected fraud or violation of the Company's Code of Conduct. The Policy provides foradequate safeguards against victimization of employees who avail of the mechanism andprovides to employees' direct access to the Chairman of the Audit Committee. It isaffirmed that no personnel of the Company have been denied access to the Audit Committee.The Whistle Blower Policy has been posted on the Website of the Company

28. performance evaluation:

Pursuant to the applicable provisions of the Companies Act 2013 the Board has carriedout an Annual Evaluation of its own performance performance of the Individual DirectorsKey Managerial Personnel and Committees of Board based on the evaluation criteria definedby Nomination and Remuneration Committee (NRC) for performance evaluation process of theBoard its Committees Directors and Key Managerial Personnel. All the evaluation iscarried out at Board of Director's meeting Independent Director's meeting and Nominationand Remuneration Committee meeting. Having regard to the industry size and nature ofbusiness your company is engaged and the evaluation methodology adopted is in the opinionof the Board sufficient appropriate and is found to be serving the purpose.

29. Disclosure under the Sexual harassment of Women at Workplace (preventionprohibition and Redressal) Act 2013:

The Company is committed to provide safe and conducive environment to its employeesduring the year under review. Your Directors further state that during the year underreview there were no cases filed pursuant to the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.

30. Corporate Governance Report:

In terms of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulation 2015 please note that compliance with the corporate governanceprovisions as specified in regulations 17 17A 18 19 20 2122 23 24 24A 25 26 27and clauses (b) to (i) and (t) of subregulation (2) of regulation 46 and para C D and Eof Schedule V shall not apply in respect of a listed entity having paid up equity sharecapital not exceeding rupees ten crore and net worth not exceeding rupees twenty fivecrore as on the last day of the previous financial year.

Since your Company's paid up equity share capital and net worth as on financial yearended 31st March 2021 are below the above mentioned figures the CorporateGovernance Report as required under para C of Schedule V is not attached.

31. Management Discussion And Analysis: overall Review:

The overall profitability of the Company during the year under review as compared tothe previous year has been adversely affected due to the unfavourable economic and marketconditions prevailing throughout the year in all the business segments on account ofdisruptions caused by the COVID 19 pandemic and the lockdown pursuant to Government'sdirectives to prevent spread of pandemic.

In Textiles it was affected due to weak domestic market conditions throughout the year.Working and operational parameters at the plants of the Company were satisfactory duringthe year.

Industry Information:

The Indian textile industry is one of the largest in the world with an unmatched rawmaterial base and manufacturing strength across the value chain. Textile industrycontributes to 7% of industry output in value terms 2% of India's GDP and 15% of thecountry's export earnings. India's year wise textiles exports performance in recent yearsis as given below:

(Value in US$ million)

Year 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 (Apr-Sept)
textile exports 36727.51 36477.48 36747.95 37497.77 34219.97 11932.09

The major export destinations of Indian Textiles export include USA UAE EuropeanUnion etc. (Source: Department of Commerce- Annual Report 2020-21)

The size of India's textile market is expected to touch US$ 223 billion by 2021growing at a CAGR of 10.23 per cent over 2016.

Indian Textile market contracted in the FY 21 by around 30% and India's exportdecreased by around 15%. Though 2020-21 was a challenging year for the textile industryit has been a learning year and taught us to conduct the business in a different manner.

opportunities and threats:

Currently the biggest threat is COVID 19 pandemic. It all depends how fast it can becontrolled to help in boosting confidence and reducing uncertainties. Further abnormalincrease in input cost and nonclarity of raw material prices are creating uncertaintyamong the manufacturers / exporters.

Indian government has come up with several export promotion policies for the textilessector. The Indian technical textiles market is expected to expand to US$ 23.3 billion by2027. Additionally the pandemic has led to increased demand for technical textiles in theform of PPE suits and equipment. Government is supporting the sector through funding andmachinery sponsoring. India enjoys a comparative advantage in terms of skilled manpowerand in cost of production. Also 100% FDI (automatic route) is allowed in the IndianTextile Sector.

Management perception of Risks and Concerns:

In today's challenging and competitive environment strategies for mitigating inherentrisks in accomplishing the growth plans of the company are imperative. The main risksinclude strategic risk operational risk financial risk and compliances and legal risk.The fast technology obsolescence high cost of manufacturing and taxation are the majorrisk/ concerns of the business.

Adequate availability of raw material at the right prices is crucial for the company.Disruption in the supply or changes in the cost structure would affect the profitabilityof the company.


In the coming financial year 2021-22 we are foreseeing increase in demand. Howeverthe Domestic and Global market outlook is still not clear because of the new strain ofCorona virus world-wide. Vaccination drive has started and there is hope to cover most ofthe population by 2nd quarter across the globe.

Our Product mix are more focused on sustainability having innovative finishes andaccordingly we are ready to cater to the market once markets reopens in full swing.

the Company's Financial performance:

The highlights of the Company's financial performance for the year ended 31stMarch 2021 is given at the start of the Directors Report.

Internal Control and Management Systems:

Your company has an adequate internal control system. There is a system of continuousinternal audit which aims at ensuring effectiveness and efficiency of systems andoperations. Your company has the benefit of internal control systems which have beendeveloped over the years and which has ensured that all transactions are satisfactorilyrecorded and reported and all assets are protected against loss from unauthorised use orotherwise. The process of Internal control and systems statutory compliance riskanalysis and its management and information technology are taken together to provide ameaningful support to the management process. Also continuous efforts are being made tostrengthen the system.

human Resource and Industrial Relations:

The Company believes that Human Resources play a significant role in achieving itsbusiness vision. Hence the Company continues to invest on hiring the best talentdeveloping and retaining the available talent to ensure a sustainable talent supply withinthe organization. The Company provides various opportunities to the employees to developtheir skills to take up higher responsibilities in the organization. The Company usesvarious communication channels to seek employees' feedback about the overall workingenvironment and the necessary tools and resources they need to perform at their bestpotential. The Company's employee strength stood at 140 as on 31st March 2021.

health Safety and Security Measures:

The Company continues to accord the highest priority to health and safety of itsemployees and communities it operates in. The Company has been fully committed to complywith all applicable laws and regulations and maintains the highest standard ofOccupational Health and Safety and ensures safer plants by conducting safety audits riskassessments and periodic safety awareness training to employees. We believe in good healthof our employees.

Further to prevent the spread of pandemic Covid 19 the Company has taken allprecautionary measures required such as use of masks and sanitizers social distancingetc. at all its plants as well as at office locations. Your Company is in full complianceof all Government directives issued in this behalf. The Company has always consideredsafety as one of its key focus areas and strives to make continuous improvement on thisfront.

Margins & Key Ratios:

EBITDA stood at ' 650.30 Lakhs in FY 2020-21 as against Rs 1222.24 Lakhs in FY2019-20. Operating Profit Margin stood at 2.54 % in FY 2020-21 as against 4.27 % in FY2019-20. Net Profit Margin stood at 1.16 % in FY 2020-21 as against 2.63 % in FY 2019-20.Debtors Turnover Ratio stood at 12.42 in FY 2020-21 as compared to 15.45 in FY 2019-20.Interest Coverage Ratio stood at 2.70 in FY 202021 as compared to 5.14 in FY 2019-20.Current Ratio decreased to 1.45 as on 31st March 2021 as against 1.83 as on31st March 2020. Debt-Equity Ratio stood at 0.67 as at 31st March2021 as against

0.76 as at 31st March 2020. Return on Capital Employed stood at 10.47 % inFY 2020-21 as against 25.34 % in FY 2019-20. Return on Net Worth stood at 7.77 % in FY2020-21 as against 32.38 % in FY 2019-20.

Due to protracted lockdown to prevent spread of Covid-19 pandemic there wassluggishness in domestic markets throughout the year which impacted the turnoverprofitability and hence the ratios.

Cautionary Statement:

Readers are cautioned that this discussion and analysis contains forward-lookingstatements that involve risks and uncertainties. The Company undertakes no obligation topublicly update or revise any forward-looking statements whether as a result of newinformation future events or otherwise. Actual results performances or achievementsrisks and opportunities could differ materially from those expressed or implied in theseforward-looking statements. Readers are cautioned not to place undue reliance on theseforward-looking statements as these are relevant at a particular point of time &adequate restrain should be applied in their use for any decision making or formation ofan opinion.

The above discussion and analysis should be read in conjunction with the Company'sfinancial statements included herein and the notes thereto.

32. Directors' Responsibility Statement:

In accordance with provisions of section 134 (3) (c) and 134 (5) of the Companies Act2013 the Board of Directors to the best of its knowledge and ability confirm that:

a. in the preparation of the annual accounts for the financial year ended 31stMarch 2021 the applicable accounting standards had been followed and there are nomaterial departures;

b. the Directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2021 and ofthe profit of the Company for the year ended on that date;

c. the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concern basis;

e. the directors had laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and were operating effectivelyand

f. the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and such systems are adequate and operating effectively.

33. Disclosure on Insolvency and Bankruptcy Code 2016:

There are no proceedings initiated / pending against your Company under the Insolvencyand Bankruptcy Code 2016.

34. Acknowledgement:

Your Directors take this opportunity to thank the employees customers vendorsinvestors of the Company and the communities in which the Company operates for theirunstinted co-operation and valuable support extended during the year.

For and on behalf of the Board of Directors For Blue Chip tex Industries limited

Shahin .n. Khemani Rahul .A. Khemani
Managing Director CFo & Director
DIn: 03296813 DIn: 03290468
place: Mumbai
Date: 4th August 2021