The Board of Directors is pleased to present herewith the 28th Annual Report of yourCompany together with the Audited financial statements for the year ended 31st March2021. The Management Discussion and Analysis has been annexed to the Directors Report.
The highlights of financial results of the company are as follows: -
(Rs. in Lacs )
|Particulars ||For the financial year 2021 (FY21) ||For the financial year 2020 (FY20) |
|Operating Revenues / Turnover ||14890.03 ||16464.54 |
|Profit before Depreciation & Amortization Finance charges ||4119.39 ||5573.22 |
|Depreciation & Amortization ||259.89 ||249.96 |
|Finance Charges ||39.40 ||52.85 |
|Profit / (Loss) before tax ||3820.10 ||5270.41 |
|Provision for taxation (incl. deferred tax) ||921.77 ||1286.35 |
|Profit / (Loss) after tax ||2898.33 ||3984.06 |
During the year under review the Company registered stable performance despiteexternal challenges due to Covid-19 pandemic. Operating revenues stood at Rs. 14890.03lacs in FY21 compared to Rs. 16464.54 lacs in FY20. Decline in revenue was due to thenationwide lockdown imposed by the Government of India on account of the outbreak ofCOVID-19 virus leading to temporary shut-down of the Company's manufacturing facilitiesand operations during the first quarter. EBITDA margins declined to 28.7% in FY21 against34.6% in FY20. Out of the total operating revenues the Male Condoms contributed about 52%in value terms as against 37% for the Female Condoms Others (Water Based Lubricant JellyHand sanitizer Hair Removal Sale of raw material) contributed 5% and IVD sale was around6%.
On an absolute basis EBITDA declined by 26% from Rs. 5573.22 lacs in FY20 to Rs.4119.39 lacs in FY21. At the net profit level we closed this financial year with a netprofit of Rs. 2898.33 lacs as against Rs. 3984.06 lacs in the previous year.
UPDATE ON COVID 19 PANDEMIC:
By the end of FY 2020-21 India witnessed a threatening second wave of COVID-19 and inthe wake of rising number of COVID-19 cases localised lockdown was imposed in majorcities throughout the country. In this environment of the new normal' we maintainedbusiness continuity through a balanced product mix and continuous product innovation inthe form of IVD (in vitro diagnostic devices). The Company does not anticipate anychallenges in its ability to continue as going concern or meeting its financialobligations.
Your Board of Directors' had declared 1st interim dividend of Re. 1 (i. e. 10%) perequity share at their meeting held on 5th November 2020. Further Board also recommendedfinal dividend of Rs. 3.50 (i.e. 35%) per equity share for FY 2020-21 at their meetingheld on 3rd June 2021 which is subject to approval of shareholders in the ensuing AGM.Hence during the year the Company will pay a total dividend of Rs. 4.50 (i.e. 45%) perequity share if the final dividend will approved by shareholders.
The whole of profit after tax has been transferred to Profit & Loss account.Interim Dividend is paid and Final Dividend provision is adjusted in the Profit & Lossaccount. There is no other amount that has been proposed to be carried to any otherreserves.
CHANGE IN NATURE OF BUSINESS
The Company manufactures Male and Female Rubber Contraceptives and Lubricant Jelly.Further during the year under review the company has diversified into the business of InVitro Diagnostic Devices (IVD).
The paid up Equity Share Capital as at 31st March 2021 is Rs. 1333.80 Lac (ThirteenCrores Thirty Three Lacs and Eighty Thousand Only). During the year under review theCompany has not issued shares with differential voting rights nor has granted any stockoptions as sweat equity. As on 31st March 2021 none of the Directors of the Company holdinstruments convertible into equity shares of the Company.
FINANCE AND ACCOUNTS
Your Company prepares its financial statements in compliances with the requirements ofthe Companies Act 2013 and the Indian Accounting Standard (IND AS). The financialstatements have been prepared on historical cost basis. The estimates and judgmentsrelating to the financial statements are made on a prudent basis so as to reflect in atrue and fair manner the form and substance of transactions and reasonably present theCompany's state of affairs profits and Cash Flows for the year ended 31st March 2021.There is no audit qualification in financial statements by the statutory auditors for theyear under review.
LOANS GUARANTEES & INVESTMENTS
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to Financial Statements.
The Company has not accepted any deposit from the public falling within the ambit ofSection 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules2014 or under Chapter V of the Act.
RELATED PARTY TRANSACTIONS
During the year under review the Company has not entered into any contracts orarrangements with related parties referred to in Section 188 of the Companies Act 2013and providing the information in the prescribed Form AOC-2 are not applicable to theCompany. There are no transactions with related parties except those indicated in notes toaccounts.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism to deal with instance of fraud and mismanagement ifany. It ensures that strict confidentiality is maintained whilst dealing with concerns andalso no discrimination will be meted out to any person for a genuinely raised concern. Anysuspected or confirmed incident of fraud / misconduct can be reported thereof.
The Whistle Blower Policy has been posted on website of the Company at below link:-
There is a continuous process for identifying evaluating and managing significantrisks faced through a risk management process designed to identify the key risks facingbusiness. During the year a risk analysis and assessment was conducted and no major riskswere noticed.
PERFORMANCE EVALUATION OF BOARD
Pursuant to the provisions of the Companies Act 2013 and Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 the Boardhas carried out an annual performance evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and other Committees. The same is found to be satisfactory.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
At the time of appointing a Director a formal letter of appointment is given to themwhich inter alia explains the role function duties and responsibilities expected of themas a Director of the Company. The Director is also explained in detail the Compliancerequired from him under the Companies Act 2013 Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 and other relevantregulations and affirmation taken with respect to the same.
Further the Company has put in place a system to familiarize the Independent Directorsabout the Company its products business and the on-going events relating to the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mrs. Veena Garg Director of the Company retires by rotationat the ensuing Annual General Meeting of the Company and being eligible offers herselffor re-appointment.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under theCompanies Act 2013 and Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
The following are the Key Managerial Personnel of the company:
Mr. Omprakash Garg: - Chairman and Managing Director
Mr. Saurabh V. Karmase: - Company Secretary and Compliance Officer
Mr. Narendra M. Joshi: - Chief Financial Officer
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of the Company asrequired under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isprovided in a separate section and forms an integral part of this Report.
During the year under review the Company has conducted 4 Board Meetings on thefollowing dates: 30th June 2020; 26th August 2020; 5th November 2020 and 10th February2021. The intervening gap between the meetings was within the period prescribed under theCompanies Act 2013 and Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. Corporate Social Responsibility Committee
The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.
M/s. Chaturvedi Sohan & Co. Chartered Accountants Mumbai were appointed asStatutory Auditors of the company at 24th Annual General Meeting which was held on 7thSeptember 2017 to hold the office as Statutory Auditor from the conclusion of 24th AnnualGeneral Meeting till conclusion of 29th Annual General Meeting of the company subject toratification by the members of the company at every Annual General Meeting.
Further as per the Companies (Amendment) Act 2017 the provision of ratification bythe members at every Annual General Meeting has been deleted w.e.f. 7th May 2018.Accordingly there is no need to ratify their appointment in the ensuing Annual GeneralMeeting of the company.
As required under Section 204 of the Companies Act 2013 Secretarial Audit Report asobtained from Mr. Shailesh Kachalia Practising Company Secretary is annexed as"annexure 1" and forms part of the Board Report.
OBSERVATIONS AUDITOR & SECRETARIAL AUDITOR
There are no qualifications contained in the Auditors Report. The company has compliedwith effect from 26th August 2020 on observations made in Secretarial Audit Reportregarding appointment of one Independent Woman Director on the board of the company andincrease the number of directors on the board up to 6 with effect from 1st April 2020.
Pursuant to Section 134(3)(a) and Section 92(3) of the Act read with Companies(Management and Administration) Rules 2014 the Annual Return of the Company in FormMGT-7 has been placed on the Company's website www.cupidlimited.com.
MATERIAL CHANGES AND COMMITMENTS
The company acquired 40% stake / securities along with management control of SeloiHealthcare Private Limited on 14th April 2021. Seloi possesses essential licenses withregard to In Vitro Diagnostic Devices (IVD's) business it will be beneficial for CupidLimited to strengthen it's newly formed diagnostic division.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators / courts /Tribunals that would impact the going concern status of the Company and its futureoperations.
ENVIRONMENT AND SAFETY
The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances environmental regulations and preservation ofnatural resources.
DISCLOSURE IN TERMS OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company took all necessary measures to ensure a harassment free workplace and hasinstituted an Internal Complaints Committee for redressal of complaints and to preventsexual harassment. No complaints relating to sexual harassment were received during theyear.
As per Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 a separate section on Report on CorporateGovernance' practices followed by the Company together with a certificate from theAuditors' of the Company confirming compliances forms integral part of this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134 (3) (c) of the Companies Act 2013:
a. that in the preparation of the annual financial statements for the year ended 31stMarch 2021 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b. that such accounting policies as mentioned in the Notes to the Financial Statementshave been selected and applied consistently and judgement and estimates have been madethat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company as at 31st March 2021 and of the profit of the Company for the year endedon that date;
c. that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;
f. that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
CONSERVATION OF ENERGY RESEARCH & DEVELOPMENT TECHNOLOGY ABSORPTION
A) Conservation of Energy:-
i. The Company has taken all effective steps to conserve the energy by installinglatest equipment's for conservation of energy. As a stand-by arrangement in case of nosupply of electricity the Company has installed generator set.
ii. The cumulative effect of the Energy conversations steps taken by the Company hasconsiderably reduced the consumption of Energy and saved the cost.
iii. The Company has installed Solar in its manufacturing facility for Energyconversation.
iv. The Company is not required to mention per unit consumption of Energy in "formA". B & C) Technology Absorption and Expenditure on Research & Development:-
The Company has deployed indigenous technology to manufacture its products. The Companyis also taking steps to upgrade its technology to improve the quality of its product so asto make same cost effective and compete in international market.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company has earned foreign exchange of Rs. 13757.21 Lacs (Previous year Rs.13952.99 Lacs) through exports whereas the Company paid / payable foreign exchange ofRs. 68.04 Lacs (Previous Year Rs. 95.73 Lacs) towards machinery / equipment's. Furtherpayments made in foreign exchange of Rs. 3634.21 Lacs (Previous Year Rs. 3639.30 Lacs)towards other expenses.
CORPORATE SOCIAL RESPONSIBILITY
In terms of the provisions of Section 135 of the Companies Act 2013 read withCompanies (Corporate Social Responsibility Policy) Rules 2014 the Board of Directors ofyour Company has constituted a Corporate Social Responsibility ("CSR") Committeewhich is chaired by Mr. Pradeep Kumar Jain Independent Director of the Company the othermembers of the committee are Mr. Omprakash Garg Chairman and Managing Director and Mr.Jandhyala L. Sharma Independent Director. Your Company also has in place a CSR policy andthe same is available on the website of the Company athttps://www.cupidlimited.com/wp-content/uploads/2020/07/05_001_CG_01CSR-Policy.pdf. Adetailed report as per Rule 8 of the Companies (Corporate Social Responsibility Policy)Rules 2014 is attached as "Annexure 2" forming part of this report.
The Audit Committee now headed by Shri. Pradeep Kumar Jain as Chairman of thecommittee. Shri. Omprakash Garg and Shri. Jandhyala L. Sharma are Members. The details ofall related party transactions if any are placed periodically before the AuditCommittee. During the year there were no instances where the Board had not accepted therecommendations of the Audit Committee.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee is headed by Shri. Pradeep Kumar Jain asChairman of the committee. Shri. Jandhyala L. Sharma and Mrs. Veena Garg are the membersof committee. During the year there were no instances where the Board had not accepted therecommendations of the Nomination and Remuneration Committee.
STAKEHOLDER RELATIONSHIP COMMITTEE
The Stakeholder Relationship Committee is headed by Shri. Pradeep Kumar Jain asChairman of the committee. Mr. Omprakash Garg and Mrs. Veena Garg are the members ofcommittee. During the year there were no instances where the Board had not accepted therecommendations of the Stakeholder Relationship Committee.
PERFORMANCE EVALUATION CRITERIA FOR INDEPENDENT DIRECTORS:
Pursuant to the provisions of the Companies Act 2013 and regulation 17 of Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 the performance evaluation of the Independent Directors is carried out by othernon-independent directors on the basis of their contribution towards important aspects ofthe company and active participation on the board. The Directors express theirsatisfaction with the evaluation process.
Further the company have constituted Performance Evaluation Policy to evaluate theperformance of Independent Directors and the said policy is available on the website ofthe company athttps://www.cupidlimited.com/wp-content/uploads/2020/07/Performance_Evaluation.pdf
REMUNERATION OF DIRECTORS
Pecuniary Relationship or Transactions with the Non-Executive Directors:
There was no any pecuniary relationship or transaction took place between the companyand its non-executive directors.
Criteria of making payments to non-executive directors:
Company is paying the sitting fees as decided by the board for attending the boardmeetings and various committee meetings and profit related commission as approved by theshareholders to all the non-executive directors. Further Company reimburses out of pocketexpenses incurred by all the non-executive directors of the Company in connection withvarious affairs of the company.
PARTICULARS OF EMPLOYEE
The disclosure required under section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached as"Annexure 3".
The statement of particulars of employees pursuant to Rule 5 (2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of thisAnnual Report and attached as "Annexure 4".
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
The Company takes pride in the competence dedication and commitment of its employeesin all sectors of the business. The Company has a structured training and managementdevelopment programs to upgrade skills of employees of the company. Objective appraisalsystems are in place for senior management staff.
The Company is committed to enhancing and retaining its top talent through superiorlearning and organizational development. This is a part of our Human Resource function andis an essential pillar to support the organization's growth and its sustainability in thelong run.
The company is strongly giving emphasis on maintaining its current industrial relationsand developing the new ones.
As per the Companies (cost records and audit) Rules 2014 and the amendments madethereof notified by Ministry of Corporate Affairs cost audit is not applicable to thecompany. Therefore the board did not proceed with the appointment of cost auditor and costaudit for the year 2021-22. The company is properly maintaining its cost recordinternally.
SUBSIDIARY/JOINT VENTURE/ASSOCIATE COMPANIES
Company doesn't have any Subsidiaries or Joint Ventures or Associate companies as onMarch 31 2021 as defined under the Companies Act 2013 and hence providing theinformation in the prescribed Form AOC-1 is not applicable to the Company.
Statements in this Directors' Report and Management Discussion and Analysis Reportdescribing the Company's objectives projections estimates expectations or predictionsmay be forward-looking statements' within the meaning of applicable securities lawsand regulations. Actual results could differ materially from those expressed or implied.Important factors that could make difference to the Company's operations include rawmaterial availability and its prices cyclical demand and pricing in the Company'sprincipal markets changes in Government regulations Tax regimes economic developmentswithin India and other ancillary factors.
Your Directors would like to express their grateful appreciation for the contributionmade by the employees at all levels. Your Directors are also deeply grateful for theconfidence and faith shown by the Shareholders of the Company in them. Your Directors alsowish to thank its customers dealers agents suppliers and bankers for their continuedsupport and faith reposed in the Company.
| ||For and on behalf of the Board of Directors |
| ||Omprakash Garg |
| ||Chairman & Managing Director |
| ||Din No: 00140756 |
|CIN No. : L25193MH1993PLC070846 || |
|Website: www.cupidlimited.com || |
|Email: email@example.com || |
|REGISTERED OFFICE || |
|A - 68 M. I. D. C. (Malegaon) Sinnar Nashik || |
|Maharashtra- 422113 || |
|Place: Ohio USA || |
|Date: 12th August 2021 || |