The Members of
Ecoboard Industries Limited
The directors submit annual report of Ecoboard Industries Limited (the"Company") along with the audited financial statements for the financial year(FY) ended on 31st March 2021. Consolidated performance of the Company hasbeen referred to wherever required.
Directors have tried to maintain coherence in disclosures and flow of the informationby clubbing required information topic-wise and thus certain information which isrequired in directors' report is clubbed elsewhere and has to be read as a part of boards'report.
1. FINANCIAL SUMMARY / HIGHLIGHTS
The financial performance of your Company:
(Amounts in Lakhs)
|Particulars ||Current Year 2020-21 ||Previous Year 2019-20 |
|Income: || || |
|Revenue from operations ||1502.07 ||1203.73 |
|Other Income ||145.94 ||193.85 |
|Total Income ||1648.01 ||1397.58 |
|Expenditure: || || |
|Cost of materials consumed ||629.35 ||674.99 |
|Purchase of Stock-in-Trade ||8.59 ||0.00 |
|Changes in inventories of finished goods ||43.98 ||(182.61) |
|-work-in progress ||182.87 ||167.90 |
|Employee benefits expense ||297.23 ||239.13 |
|Finance costs ||94.17 ||94.82 |
|Depreciation ||713.54 ||735.27 |
|Other expenses || || |
| ||1969.73 ||172950 |
| ||(321.72) ||(331.92) |
|Profit / (Loss) before exceptional items and tax || || |
| ||1447.35 ||1838.55 |
|Add/(Less): Exceptional items || || |
| ||1125.63 ||1506.63 |
|Profit / (Loss) before tax || || |
| ||0.00 ||0.00 |
|Less: Tax expenses || || |
| ||1125.63 ||1506.63 |
|Profit / (Loss) for the period || || |
|Other Comprehensive Income ||20.04 ||1.96 |
|Items that will not be reclassified into profit or loss || || |
| ||20.04 ||1.96 |
|Other Comprehensive income for the year (net of tax) ||1145.67 ||1508.59 |
|Total comprehensive income for the year || || |
| ||6.42 ||8.46 |
|Earnings / (Loss) per Share (Rs.) ||6.42 ||8.46 |
|-Basic || || |
|-Diluted || || |
During the year 2020-21 your company has made turnover of Rs 1502.07 Lakhs as comparedto turnover of the previous financial year of Rs. 1203.73 Lakhs whereas profit for theyear (before comprehensive income) is Rs.1125.63/- Lakhs as against Rs. 1506.63/- Lakhsin the previous financial year. Boards of Directors are very confident that the businessof the Company will continue to grow in upcoming years.
|Year ||Sales performance (Rs. Lacs) ||PBT (Rs. Lacs) ||PAT (Rs. Lacs) ||EPS (Rs. Lacs) |
|2016 ||2205.48 ||(1489.82) ||(1489.82) ||(8.35) |
|2017 ||1633.84 ||(996.21) ||(996.21) ||(5.59) |
|2018 ||883.21 ||(1387.32) ||(1387.32) ||(7.72) |
|2019 ||2038.20 ||(720.24) ||(720.24) ||(4.04) |
|2020 ||1203.73 ||1506.63 ||1506.63 ||8.46 |
|2021 ||1502.07 ||1125.63 ||1125.63 ||6.42 |
In the last month of FY 2021 in view of the Government directions on lockdown toprevent the spread of Novel Corona virus (COVID19) the operations of the Company had tobe suspended temporarily. The Company has taken all steps/ measures to meet the safetynorms as prescribed by the Government Authorities to prevent the spread of COVID-19 and toensure safety and well being of the employees.
Based on internal financial control framework and compliance systems established in theCompany the work performed by statutory internal and secretarial auditors and reviewsperformed by the management and/or relevant Audit and other Committees of the Board yourBoard is of the opinion that the Company's internal financial controls were adequate andeffective during the financial year 2020-21.
The Board of Directors of the Company did not declare any dividend during the FinancialYear 2020-21.
3. SEGMENT WISE AND PRODUCT-WISE OPERATIONAL PERFORMANCE
The details are given under Notes to Accounts of financial statements.
4. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTSOR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There are no such orders except those which have been appropriately challenged beforethe judiciary and no impact on going concern status and Company's operation in future ofsuch matters are expected or visualized at the current stage at which they are.
5. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCETO THE FINANCIAL STATEMENTS
Your Company has an internal Control System which commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function lieswith the Audit Committee of Directors. The Audit Committee monitors and evaluates theefficacy and adequacy of internal control systems accounting procedures and policies. TheCompany has not appointed Internal Auditors yet.
6. DETAILS OF HOLDING/SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES
The Company has no subsidiary/joint venture/associate company and hence consolidationand applicable provision under the Companies Act 2013 and Rules made there under are notapplicable to the Company.
7. BOARD EVALUATION
Pursuant to applicable provisions of the Companies Act 2013 and the ListingRegulations the Board carried out an annual performance evaluation of the Board itsCommittees Individual Director and Chairperson. The manner in which the evaluation hasbeen carried out has been explained in the Corporate Governance Report.
8. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES
The Company has a Vigil Mechanism Policy in place to deal with instances if any ofthe fraud mismanagement misappropriations if any and the same is placed on theCompany's website.
9. MANAGERIAL REMUNERATION
Details as required pursuant to Rule 5 of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 are contained in Corporate Governance Report.
10. NUMBER OF PERMANENT EMPLOYEES
During the period under review there are 56 permanent employees of the Company.
11. BOARD DIVERSITY
The Company recognizes and embraces the importance of a diverse board in its success.We believe that a truly diverse board will leverage difference in thought perspectiveknowledge skill regional and industry experience cultural and geographical backgroundsage ethnicity race and gender that will help us retain our competitive advantage. TheBoard Diversity Policy adapted by the Board sets out its approach to diversity. The policyis available on our website at https://www.ecoboard.in/investor-relations.
Additional details on Board diversity are available in the Corporate GovernanceReport that forms part of this Annual Report.
12. DIRECTORS RESPONSIBILITY STATEMENT
The financial statements are prepared in accordance with the Indian AccountingStandards (Ind AS) under the historical cost convention on accrual basis except forcertain financial instruments which are measured at fair values the provisions of theCompanies Act 2013 and guidelines issued by SEBI. The Ind AS are prescribed under Section133 of the Companies Act 2013 read with Rule 3 of the Companies (Indian AccountingStandards) Rules 2015 and Companies (Indian Accounting Standards) Amendment Rules 2016.Accounting policies have been consistently applied except where a newly-issued accountingstandard is initially adopted or a revision to an existing accounting standard requires achange in the accounting policy hitherto in use. In terms of Section 134(3) (c) of theCompanies Act 2013 the directors confirm that:
a. that in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures; thedirectors had selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitand loss of the company for that period; b. the directors had taken proper and sufficientcare has been taken for the maintenance of adequate accounting records in accordance withthe provisions of the Companies Act 2013 for safeguarding the assets of the Company andfor preventing and detecting fraud and other irregularities;
c. that the annual accounts have been prepared on a going concern basis;
d. the directors had laid down proper internal financial controls which were in placeand that the financial controls were adequate and were operating effectively.
e. that the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws were in place and were adequate and operatingeffectively.
13. MEETINGS OF THE BOARD OF DIRECTORS
During the Financial Year 2020-21 the Company held 9 (Nine) board meetings of theBoard of Directors as per Section 173 of Companies Act 2013 which is summarized below.The provisions of Companies Act 2013 and Listing Regulations were adhered to whileconsidering the time gap between two meetings.
|Name of Director ||Category || |
Attendance of meeting during 2020-21
|*No. of other Directorship |
| || ||Board ||Last AGM || |
|Mr. Ramakrishna Raju Gottumukkala ||Managing Director Chairman ||9 ||Yes ||1 |
|Mr. Praveen Kumar Raju Gottumukkala ||Executive Director ||9 ||Yes ||0 |
|Mrs. Venkata Sujani Indukuri ||Non-Executive Director ||9 ||Yes ||0 |
|Mr. Uttam Sampatrao Kadam ||Non-Executive & Independent ||8 ||Yes ||12 |
|Mr. Siva Sankar Kalive ||Non-Executive & Independent ||8 ||Yes ||0 |
|Mr. P. V. V. Rama Raju ||Non-Executive & Independent ||9 ||Yes ||0 |
14. PARTICULARS OF LOANS ADVANCES GUARANTEES AND INVESTMENTS
Pursuant to section 186 of Companies Act 2013 and Schedule V of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations
2015 ("Listing Regulations") disclosure on particulars relating to Loansadvances guarantees and investments are provided as part of the financial statements.
15. LISTING REGULATIONS COMPLIANCE
Your Company's Equity Shares are listed on BSE Ltd. and the provisions of the Listing
Obligation and Disclosures Requirement Regulations 2015 have been complied with.
Your Company has not accepted any deposits from public and as such no amount onaccount of principal or interest on public deposits was outstanding as on the date of thebalance sheet.
17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREX EARNING AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134 (3) (m) of the Companies Act 2013 readwith Rule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as "AnnexureA".
18. RISK MANAGEMENT
Periodic assessments to identify the risk areas are carried out and management isbriefed on the risks in advance to enable the company to control risk through a properlydefined plan. The risks are classified as financial risks operational risks and marketrisks. The risks are taken into account while preparing the annual business plan for theyear. The Board is also periodically informed of the business risks and the actions takento manage them. The Company has formulated a policy for Risk management with the followingobjectives:
Provide an overview of the principles of risk management
Explain approach adopted by the Company for risk management
Define the organizational structure for effective risk management
Develop a "risk" culture that encourages all employees to identify risks andassociated opportunities and to respond to them with effective actions.
19. ANNUAL REVALUATION
Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Audit Nomination & Remuneration andCompliance Committees. A structured questionnaire was prepared after taking intoconsideration inputs received from the Directors covering various aspects of the Board'sfunctioning such as adequacy of the composition of the Board and its Committees Boardculture execution and performance of specific duties obligations and governance. Aseparate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgment safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Secretarial Department.
20. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The current policy is to have an appropriate mix of executive non-executive andindependent directors to maintain the independence of the Board and separate itsfunctions of governance and management. As of March 31 2021 the Board had 6 members twoof whom are executive directors one of whom is a non-executive and woman director andthree independent directors. The details of Board and committee composition tenure ofdirectors areas of expertise and other details are available in the corporate governancereport that forms part of this Annual Report. The policy of the Company on directors'appointment and remuneration including the criteria for determining qualificationspositive attributes independence of a director and other matters as required underSub-section (3) of Section 178 of the Companies Act 2013 is available on our website athttps://www.ecoboard.in/investor-relations.
We affirm that the remuneration paid to the directors is as per the terms laid out inthe Nomination and Remuneration Policy of the Company.
21. INDEPENDENT DIRECTORS AND DECLARATION
Composition of the independent director is in compliance with the provisions of theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he / she meets the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 ofthe Listing Regulations.
22. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
All new independent directors inducted into the Board attend an orientation program.The details of the training and familiarization program are provided in the CorporateGovernance report. Further at the time of the appointment of an independent director theCompany issues a formal letter of appointment outlining his / her role function dutiesand responsibilities. The policy related to familiarization of Independent Director isavailable on our website at https://www.ecoboard.in/investor-relations.
23. DIRECTORS AND KMP
Mr. P. V. V. Rama Raju (DIN 07464714) was re-designated/ re-appointed as anindependent director for the second term of next five years effective from 14th November2020 up to 14th November 2025 (both days inclusive) as per the provisions of Section 149of the Companies Act 2013. His office of directorship is due for retirement in November2020. Based on the recommendation of the nomination and remuneration committee and aftertaking into account the performance
The details of Appointment re-appointment and retiring by rotation of Directors andKey Managerial Personnel (KMP) are included in Corporate Governance Report and forms partof the board's report as "Annexure B".
24. COMMITTEES OF THE BOARD
As on 31st March 2021 the Board had three committees: the audit committeethe nomination and remuneration committee and the stakeholder's relationship committee. Amajority of the committees consists entirely of independent directors. The Board at itsmeeting held on 14th April 2021 instituted the Environment Social andGovernance (ESG) committee. The committee consists entirely of independent directors.During the year all recommendations made by the committees were approved by the Board. Adetailed note on the composition of the Board and its committees is provided in theCorporate Governance Report.
25. CODE OF CONDUCT
i. Code of Conduct for Director and Senior Management of the Company: The Company hasadopted the Code of Conduct for the Directors and Senior Management of the Company. AllBoard Members and Senior Management Personnel have affirmed compliance with the code as onMarch 2015.
ii. Code of Conduct for prevention of Insider Trading: The Company has its own Code ofConduct for Prevention of Insider Trading which has now been amended according to the SEBI(Prohibition of Insider Trading) Regulations 2015.
26. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY
The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the Company's policies safeguarding ofits assets prevention and detection of fraud error reporting mechanisms accuracy andcompleteness of the accounting records and timely preparation of reliable financialdisclosures. For more details refer to the Internal control systems and theiradequacy' section in the Management's discussion and analysis which forms part of thisAnnual
27. CORPORATE GOVERNANCE
As the listed Company necessary measures are taken to comply with provisions of theSEBI (Listing Obligation and Disclosure Requirements) Regulation 2015. The Report onCorporate Governance along with the certificate as stipulated confirming compliance withthe conditions of Corporate Governance the Managing Director's declaration as stipulatedunder the aforesaid Clause Regulation and pursuant to Regulation 34 of the listingRegulations Management Discussion and Analysis Report forms part of Annual Report.
28. EXTRACT OF ANNUAL RETURN IN FORM MGT-9
The details forming part of the extract of the Annual Return in form MGT-9 is uploadedin Company's website. The link of annual report as per the Companies Amendment Act 2017is www.ecoboard.in and in accordance with the Companies Act 2013 the annual return inthe prescribed format is available at https://www.ecoboard.in/investor-relations.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items since there were no transactions in these matters and/or they are notapplicable to the Company during the year under review: 1. Details relating to depositscovered under Chapter V of the Act. 2. Issue of equity shares with differential rights asto dividend voting or otherwise. 3. Issue of shares (including sweat equity shares) toemployees of the Company under ESOS.
4. No significant or material orders were passed by the Regulators / Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
5. No fraud has been reported by the Auditors to the Audit Committee or the Board.
30. SECRETARIAL STANDARDS
The Directors state that applicable Secretarial Standards on Board Meetings (SS-1) andon General Meetings (SS-2) have been duly followed by the Company. Also Company complieswith all applicable secretarial standards issued by the Institute of Company Secretariesof India.
31. LISTING ON STOCK EXCHANGES
The Company's shares are listed on Bombay Stock Exchange of India Limited (BSELimited).
32. SHARE CAPITAL
The Paid up capital of the company is Rs.178320000. The Company issued Rs. NilEquity Shares either with or without differential rights during the F.Y. 2020-2021 andhence the disclosure requirements under section 43 and Rule 4 (4) of the Companies (ShareCapital and Debentures) Rules 2014 is not applicable.
33. COMPENSATION AND DISCLOSURE ANALYSIS
The Companies Act listing Regulations through various provisions require disclosureand analysis on executive director's KMP's and other employees' compensation. The saidinformation forms part of board's report annexed herewith as "Annexure B"
34. RELATED PARTY TRANSACTIONS
Related party disclosures pursuant to sub-section (1) of section 188 of the CompaniesAct
2013 are forming part of the Board report and is annexed herewith as "AnnexureC".
35. STATUTORY AUDITORS
Under Section 139 of the Companies Act 2013 and the Rules made there under it ismandatory to rotate the statutory auditors on completion of the maximum term permittedunder the provisions of Companies Act 2013. In line with the requirements of theCompanies Act 2013 Company's Auditors M/s B. M. Chaturvedi & Co. CharteredAccountants Mumbai (Firm Registration No. 114317W) was appointed as the statutoryauditors of the Company to hold office for the period of five consecutive years i.e.01.04.2017 to 31.03.2022 i.e. till the conclusion of the 31st AGM to be held in 2022. Therequirement for the annual ratification of auditors' appointment at the AGM has beenomitted pursuant to Companies (Amendment) Act 2017 notified on May 7 2018. Thereforenow the ratification of the appointment of the Statutory Auditors at every Annual GeneralMeeting is not required.
36. SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. S. R. Siddheshwar & Co. Pune a firm of Company Secretaries inPractice to undertake the Secretarial Audit of the Company. Secretarial Audit Report forthe financial year 31st March 2021 is annexed herewith as "AnnexureD" in FORM MR-3.
37. COMMENTS ON OBSERVATIONS ON SECRETARIAL AUDIT REPORT
The observation and qualification is annexed with as "Annexure D".
38. REPORTING OF FRAUDS BY AUDITORS
During the year under review neither the statutory auditors nor the secretarialauditor has reported to the audit committee under Section 143 (12) of the Companies Act2013 any instances of fraud committed against the Company by its officers or employeesthe details of which would need to be mentioned in the Board's report.
39. AUDIT REPORTS AND AUDITORS AUDIT REPORTS
The Auditors' Report for fiscal 2021 along with any qualification reservation oradverse remark is enclosed with the financial statements in this Annual Report.
The Auditor's certificate confirming compliance with conditions of corporategovernance as stipulated under Listing Regulations for fiscal 2021 is enclosed as "AnnexureE" to the Board's report.
40. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
Following are the material changes and commitments affecting the financial position ofthe Company which occurred during between the end of the financial year to which thefinancial statements relate and the date of this report:
Compulsory Acquisition of Land situated at Velapur District Malshiras by Nationalhighway Authority during FY 2020-21
During the year National highway Authority has acquired 7 Acres 83 R of Company landsituated at Velapur Maharashtra for road widening purpose. Company is awardedcompensation of Rs 1643.23 lakh which is tax free as per CBDT Circular. Same is shownunder exceptional item. Company has received Rs 793.58 lakh during the year. Company haswritten off Rs 195.88 lakh being book value of land acquired by National HighwayAuthority which is also shown under exceptional item.
Sale of land and building at Jambhulwadi
During the previous year 2019-20 Company has sold its land and buildings at Jambhulwadiand has booked Profit of Rs 833.52 lakh on the said transaction same was shown underexceptional items. Company has also sold its office in the previous year 2019-20 theCompany is able to successfully complete sale of its land and buildings at Jambhulwadi on19th July 2019 situated at Pune and has booked profit of Rs 244.78 lakh on the saidtransaction. Same was also shown under exceptional item.
Company has obtained Shareholders approval in the Annual General Meeting held on 27thSeptember 2019 for sale of part of excess land admeasuring about 40 acres (Non-coreassets) of the Company situated at Velapur Maharashtra. Accordingly carrying cost ofland is shown as "Assets held for sale" as per Ind AS 105. Sale transaction isawaiting bank's approval.
One Time Settlement to Bank of Maharashtra
During the previous year 2019-20 Company has made One Time Settlement of its dues underMaha Riyayat Scheme of the Bank of Maharashtra. Company made payment of Rs. 54.50 lakhsover and above the principal amount of dues to the bank as per the terms agreed with thebank. Company has written back its interest liability of Rs 704.94 lakh. The same is shownas exceptional item.
Impact of Covid-19 Pandemic
The outbreak of Covid-19 pandemic has caused partial disruption in business activity ofthe Company. The manufacturing and sales activities of the company came to complete haltduring the months of April and May 2020. Though in view of need of company's particleboards for quick construction of Covid-19 treatment facilities manufacturing activity waspermitted in the month of May 2020 itself yet the activity has remained need based due toprevalent pandemic in the area. Sales of products are likely to remain muted for moretime. Management has evaluated the impact of this development and is of the view thatthere may not be a significant risk associated with recoverability of assets and meetingof its liabilities.
41. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THEREGULATORS/COURTS/TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'SOPERATIONS IN FUTURE
There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.
42. INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2014
The Company has constituted an internal complaints Committee under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2014. Duringthe year no complaint was filed before the said Committee.
43. ACKNOWLEDGEMENTS AND APPRECIATION
Your Directors take this opportunity to thank the customers shareholders suppliersbankers business partners/associates financial institutions and Central and StateGovernments for their consistent support and encouragement to the Company. I am sure youwill join our Directors in conveying our sincere appreciation to all employees of theCompany for their hard work and commitment. Their dedication and competence has ensuredthat the Company will definitely overcome from such turbulent situation and emerge assignificant and leading player in the industry.
|FOR AND ON BEHALF OF THE BOARD OF DIRECTORS |
|Ramakrishna Raju Guttumukkala |
|Chairman & Managing Director |
|DIN: 01516984 |
|Place: Pune |
|Date: 10th August 2021 |