The Directors are pleased to present the Tenth (10th) AnnualReport of the Company together with the audited financial statements (consolidated andstandalone) for the year ended 31st March 2021.
In compliance with the applicable provisions of Companies Act 2013(including any statutory modification(s) or re-enactment(s) thereof for time being inforce) ("Act) and the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 ("SEBI Regulations)this report covers the financial results and other developments during the financial yearended 31st March 2021 in respect of Genus Paper & Boards Limited.
FINANCIAL HIGHLIGHTS & STATE OF AFFAIRS
The highlights of financial statements of the company for the financialyear 2020-21 are given below:
(Amount in Lakh)
|Particulars ||Year Ended 31.03.2021 ||Year Ended 31.03.2020 ||Year Ended 31.03.2021 |
| || |
|Net Sales / Revenue from Operations ||28571.77 ||25393.27 ||28571.77 |
|Other Income ||94.89 ||0.00 ||94.89 |
|Finance Cost ||390.92 ||527.06 ||390.92 |
|Depreciation ||1270.98 ||1331.50 ||1270.98 |
|Profit Before Tax ||1013.77 ||857.95 ||1013.77 |
|Tax Expenses || || || |
|-Current Tax ||323.55 ||297.71 ||323.55 |
|-Earlier Year Tax ||9.54 ||11.36 ||9.54 |
|-Deferred Tax ||-88.11 ||-342.23 ||-88.11 |
|Net Profit /(Loss) for the Year ||768.79 ||891.11 ||768.79 |
|Other Comprehensive Income || || || |
|Items that will not be reclassified to profit or loss ||-62.89 ||-411.81 ||-82.22 |
|Total Comprehensive Income ||705.91 ||479.30 ||686.57 |
|Earnings Per Share (FV Re. 1/- each) || || || |
|-Basic (In Rs.) ||0.30 ||0.35 ||0.30 |
|-Diluted (In Rs.) ||0.30 ||0.35 ||0.30 |
OPERATIONS AND BUSINESS PERFORMANCE Standalone Financial Results:
During the Financial Year (FY) 2020-21 the Company has achieved anoperating income of Rs. 28571.77 Lakhs as compared to Rs. 25393.27 Lakhs in FY 2019-20.The profit before tax for FY 2020-21 stood at Rs. 1013.77 Lakhs compared to Rs. 857.95Lakhs achieved in FY 2019-20. The profit after tax stood at Rs. 768.79 Lakhs for FY2020-21 as compared to Rs. 891.11 Lakhs for the previous year. Consolidated FinancialResults:
The Company's consolidated revenue for FY 2020-21 was Rs. 28571.77Lakhs. During the year under review the consolidated profit after tax stood at Rs. 768.79Lakhs.
During the Financial year 2020-21 the Company has proposed no amountto reserves.
Keeping in view further improving the capacity utilization andconsolidating its existing facilities the Board has considered prudent to conserve andretain the profit for further improvement. The Board regrets its inability to recommendany dividend.
NATURE OF BUSINESS
Genus Paper & Boards Limited ('GPBL' or the 'Company') isengaged in the business of manufacturing of Kraft paper and steel ingot (core businessdivision). The Company has also been engaged in making strategic investment activitywhere under investments are made in shares and securities basis a thorough and systematicevaluation by the Company and the management on a going concern basis with dedicatedpersonnel and technical staff.
During the year under report the Company has incorporated a whollyowned subsidiary named Genus Paper and Coke Limited (formerly known as Kailash Paper andCoke Limited) on 23rd July 2020. The statement (Form AOC-1) pursuant to firstproviso to Section 129(3) of the Companies Act 2013 read with Rule 5 of Companies(Accounts) Rules 2014 is enclosed as Annexure-VI being part of the annual report. SHARECAPITAL:
The paid up equity capital as on March 312021 was Rs. 257125940.The Company has not issued shares with differential voting rights nor granted stockoptions nor sweat equity during the year.
CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to Sections 149152 and other applicable provisions if anyof the Companies Act 2013 Mr. Himanshu Agarwal (having DIN- 00065185) Director of theCompany will retire by rotation at the ensuing Annual General Meeting and being eligibleoffer himself for re-appointment in accordance with the provisions of the said Act.
The Board has considered that the presence of Mr. Himanshu Agarwal asDirector on the Board would be immense benefit to the Company and has decided to recommendtheir appointment /reappointment for the approval of members of the Company at the ensuinggeneral meeting of the company.
The Company in its meeting held on 01st March 2021 based onthe recommendation of Nomination and Remuneration Committee had appointed Mr. AkhileshKumar Maheshwari as an Additional Director (Executive Director) subject to the approval ofthe members of the Company in the ensuing Annual General Meeting.
Mr. Rameshwar Pareek (DIN: 00014224) ceased to be director with effectfrom 07h July 2020 due to some pre-occupations in other areas and he was notbe able to devote his time to perform the duties in the capacity of non-executiveindependent director of the Company. Mr. Yash Todi (DIN: 08034207) ceased to be directorwith effect from 09th October 2020 due to some pre-occupations in other areasand he was not be able to devote his time to perform the duties in the capacity ofnon-executive non-independent director of the Company. The Company in its meeting held on11th August 2020 based on the recommendation of Nomination and RemunerationCommittee had appointed Mr. Dharam Chand Agarwal (DIN:00014221) as an Additional Director(Non- Executive Independent Director) and regularize in the 09th Annual GeneralMeeting as an Independent Director of the Company.
A brief resume of the Directors being appointed/ re-appointed thenature of their expertise in specific functional areas names of other companies in whichthey hold/have held Directorships Committee Memberships/ Chairmanships theirshareholding etc. are furnished in the explanatory statement to the notice of the ensuingAGM.
DECLARATION FROM INDEPENDENT DIRECTORS
As provided under Section 149 (7) of the Companies Act 2013 AllIndependent Directors of the Company viz. Mr. Dharam Chand Agarwal Mr. Udit Agarwal Mr.Pradeep Narain Tandon Mr. Rajendra Aggarwal and Mrs. Anu Sharma have made declaration tothe effect that they meet the criteria of independence as stipulated under Section 149(6)of the Act and Regulation 16(1) (b) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors of the Company in pursuant to clause (c) of sub section(3) of Section 134 of the Companies Act 2013 hereby confirm that:
(a) in the preparation of the annual accounts the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures;
(b) the directors had 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 the company at the end of thefinancial year and of the profit and loss of the company for that period;
(c) the directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of this Actfor safeguarding the assets of the company and for preventing and detecting fraud andother irregularities;
(d) the directors had prepared the annual accounts on a going concernbasis; and
(e) the directors had laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively.
(f) the directors had devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
During the Financial Year 2020-21 the Company has not invitedaccepted or renewed any deposits covered under Chapter V of the Companies Act 2013 andthere is no outstanding amount of deposits at the end of the financial year.
AUDITORS AND AUDITORS' REPORT
Details of the Auditors of the Company and their Audit Reports for theyear under report are given below:
At the Annual General Meeting of the Company held on 30thSeptember 2019 M/s D. Khanna & Associates Chartered Accountants Firm Jaipur (ICAIFirm Registration No-012917N) were reappointed as the Statutory Auditors of the Companyfor a period of 5 years in terms of Section 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014.
The observations of the Auditors and the relevant notes on the accountsare self-explanatory and therefore do not call for any further comments.
Secretarial Auditor and Secretarial Audit Report
M/s Gaurav Gupta & Associates Company Secretaries Moradabad avery eminent Corporate Consultant having more than 17 years experience of rendingprofessional services to several eminent companies including Central PSUs and Banks werere-appointed as Secretarial Auditors of the Company to conduct the secretarial audit forthe financial year ended March 312021 and to give their report thereon.
Pursuant to Section 204 of the Companies Act 2013 read with Rule 9 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theSecretarial Audit Report of M/s Gaurav Gupta & Associates Company SecretariesMoradabad for the financial year 2020-21 is annexed to this report as Annexure-I.
The said Secretarial Audit Report has no qualification reservation oradverse remarks and it is self explanatory. Thus there is no need to give any furtherexplanation or comment by the Board.
Secretarial Compliance Report
In Compliance of Regulation 24A of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 read with SEBICircular No. CIR/CFD/CMD/27/2019 Dated February08 2019 and SEBI/HO/CFD/CMD1/CIR/P/2020/38Dated March 19 2020 the annual secretarial compliance report issued by the practicingcompany secretary for the financial year ended on March 31 2021 is attached as"Annexure-I (i).
Section 148 of the Companies Act 2013 provides that such class ofcompanies which are engaged in the production of such goods or providing such servicesshall maintain cost records and shall get audit of such cost records by a Cost Accountantin practice as may be prescribed in the Rules notified by the Central Government for thepurpose.
The Cost Audit Report for the financial year 2020-21 in respect of theSteel Ingot prescribed under Cost Audit Rules 2014 is not applicable to be filed withMCA since the Company has closed the unit of M.S. Ingot. Hence there is no requirement forthe cost audit to be done of the Company's unit of Steel Ignot for the financial year2020-21.
Pursuant to Section 138 of the Companies Act 2013 read with Rule 13 ofthe Companies (Accounts) Rules 2014 the Company is having Internal Auditors to conductthe internal audit of the Company and to give their audit report thereon in the manner asprescribed under the Act.
CORPORATE SOCIAL RESPONSIBILITY POLICY
With the enactment of the Companies Act 2013 and the Companies(Corporate Social Responsibility) Rules 2014 read with various clarifications issued bythe Ministry of Corporate Affairs every Company having the net worth of Rs.500 crores ormore or turnover of Rs.1000 crores or more or net profit of Rs.5 crore or more during anyfinancial year have to spend at least 2% of the average net profit of the Company madeduring the three immediately preceding financial years.
Accordingly the Company has to do a CSR Activity for an amount ofRs.28.55 lacs based on the average profits of the three preceding financial years.
The CSR activities carried/to be carried out by the Company is drivenby the expertise of the management. Additionally the Company gives preference to thelocal area(s) of its operations for CSR activities. The Company believes that the CSRshould be in the field(s) which have substantial social impact and which co-relate withthe philosophy of the Company to improve the quality of life. During the FY 202021 theCompany has come across various project which reflected the above approach and hence thespending prescribed towards CSR were made during FY 2020-21.
The Corporate Social Responsibility Committee has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which is approved by the Board. This CSRpolicy is also available on the Company's website - www.genuspaper.com.
For composition of CSR Committee and other details as prescribed theAnnual Report on CSR activities is annexed to this report as Annexure-II.
RISK MANAGEMENT POLICY
The Company has framed a Risk Management Policy to identify and accessthe key business risk areas and a risk mitigation process. A detailed exercise is beingcarried out that the organization faces such as strategic financial credit marketliquidity property and other risks. The Board periodically reviews the risks andsuggests steps to be taken to control and mitigate the same through a properly definedframework.
CRITERIA FOR APPOINTMENT OF INDEPENDENT DIRECTORS
The Independent Directors shall be of high integrity with relevantexpertise and experience so as to have as diverse Board with Directors having expertise inthe fields of manufacturing marketing finance taxation Law governance and generalmanagement.
CRITERIA FOR APPOINTMENT OF MANAGING DIRECTOR / WHOLE TIME DIRECTORS
The Nomination and Remuneration Committee shall identify persons ofintegrity who possess relevant expertise and experience particularly in Paper Industryleadership qualities required for the position and shall take into considerationrecommendation if any received from any member of the Board.
The Company follows a policy on remuneration of Directors and SeniorManagement employees details of the same are given in the Corporate Governance Report.
PERFORMANCE EVALUATION OF BOARD ITS COMMITTEES AND INDIVIDUALDIRECTORS
In accordance with the provisions of the Companies Act 2013 andRegulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Nomination and Remuneration Committee has laid down the criteria for evaluationof individual Directors the Board as a whole. Based on the criteria the exercise ofevaluation was carried out through as structured process covering various aspects of theBoard functioning such as composition of Board and Committees experience and expertiseperformance of specific duties and obligation governance and compliance issuesattendance contribution at meeting etc.
The performance evaluation of the Chairman and the Non IndependentDirectors was carried out by the Independent Directors at a separately convened meetingand the performance of the Board as a whole evaluated was reviewed. The performance of theIndependent Directors was carried out by the entire Board (Excluding the Director beingevaluated).The Directors expressed their satisfaction with the evaluation.
NUMBER OF BOARD MEETINGS
During the financial year2020-21 the Board of Directors of the Companymet 12 (Twelve) times on
06/04/2020 22/05/2020 18/06/202007/07/202011/08/202021/08/202009/10/202026/10/202004/01/202114/01/202125/01/2021and 01/03/2021.
The Company has a qualified and independent Audit Committee theComposition of which is given below:
|Name of the Member ||Category ||Status |
|Mr. Udit Agarwal ||Independent Non Executive Director ||Chairman |
|Mr. Dharam Chand Agarwal ||Independent Non Executive Director ||Member |
|Mr. Pradeep Narain Tandon ||Independent Non Executive Director ||Member |
|Mr. Kailash Chandra Agarwal ||Executive Promoter Director ||Member |
During the financial year 2020-21 the Audit Committee met 4 (Four)times on 18/06/2020 21/08/2020 26/10/2020 and 25/01/2020. AH recommendations of AuditCommittee were accepted by the Board.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The particulars of contracts or arrangement with related partiesreferred to in Section 188 of the Companies Act 2013 in the prescribed form AOC-2 aredisclosed in Annexure -III and forms part of this report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Loans guarantees or investments referred to in Section 186 of theCompanies Act 2013 form part of the notes to the financial statements provided in thisAnnual Report.
The Company envisions becoming the leaders in all the areas ofoperations. Your Company is holding certain strategic investment generally long term innature and the board may evaluate further opportunities in this regard with a view toenhance value for the stakeholders of the Company.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
As prescribed under Section 197(12) of the Companies Act 2013("Act) and Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 the details are given in Annexure - IV.
Pursuant to the provisions of Section 197(12) of the Companies Act2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 and in terms of provisions of the Section 136 (1) ofthe Act the Annual Report excluding the aforesaid information is being sent to themembers of the Company. The said information is available for inspection at the RegisteredOffice of the Company during the working hours and any member interested in obtaining suchinformation may write to the Company Secretary.
It is hereby affirmed that the remuneration is as per the RemunerationPolicy of the Company.
NON EXECUTIVE DIRECTORS' COMPENSATION AND DISCLOSURES:
None of the Independent / Non- Executive Directors has any pecuniaryrelationship or transactions with the Company which in the Judgment of the Board mayaffect the independence of the Directors.
EXTRACT OF ANNUAL RETURN
As required under Section 92(3) and 134(3)(a) of the Act and Rule 12(1)of the Companies (Management and Administration) Rules 2014 (as amended) Annual Returnin E-Form MGT - 7 is available on the website of the Company at the web link www.genuspaper.com.CREDIT RATING
During the year under review CARE Ratings Limited a credit ratingagency registered with SEBI had reaffirmed the Company (Genus Paper & Boards Limited)Long Term Bank Facilities at 'BBB+' vide its letter dated December 22 2020. TheOutlook is Stable.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
Pursuant to Section 134 of the Act read with Rule 8 of the Companies(Accounts) Rules 2014 the particulars relating to conservation of energy technologyabsorption foreign exchange earnings and outgo have been given in the prescribed form in Annexure-Vto this report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATION OR COURTS ORTRIBUNALS
No significant or material orders were passed by the Regulators orCourts or Tribunals which impact the going concern and Company's operation in future.
MATERIAL CHANGES AND COMMITMENTS BETWEEN THE END OF FINANCIAL YEARUNDER REVIEW AND THE DATE OF THE REPORT:
The World Health Organization (WHO) declared outbreak of CoronavirusDisease (COVID-19) a global pandemic on March 11 2020. Consequent to this Government ofIndia declared lockdown on March 23 2020 and the Company temporarily suspended theoperations in compliance with the lockdown instructions issued by the Central and StateGovernments. COVID-19 has impacted the normal business operations of the Company by way ofinterruption in production supply chain disruption unavailability of personnel closure/ lock down of production facilities etc. during the lock-down period. However productionand supply of goods has commenced from the 2nd week of May 2020 after obtainingpermissions from the appropriate government authorities.
The company's operations revenue and consequently profit duringthe current period were impacted due to COVID-19. The company has made a detailedassessment of its liquidity position for the next year and the recoverability and carryingvalue of all its assets. Based on current indicators of future economic conditions andconsidering the various measures announced by the government to support businesses andfund the paper sector the company expects to fully recover the carrying amount of theseassets. The potential future impact of the COVID-19 may be different from that estimatedas at the date of approval of these financial results and the company will continue toclosely monitor any material changes in future economic conditions and assess the impacton its business.
2. THE DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THEINSOLVENCY AND BANKRUPTCY CODE 2016 (31 OF 2016) DURING THE FINANCIAL YEAR:
In compliance with the applicable provisions of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 the National Company Law Tribunal (Allahabad Bench) ('NCLT') has issuedits written order dated 23.02.2021 (NCLT Order) approving the resolution plansubmitted by Genus Paper & Boards Limited (GPBL)("ResolutionPlan) as approved by the Committee of Creditors ("CoC) of NSPapers Limited a Company undergoing the Corporate Insolvency Resolution Process (CIRP)pursuant to the provisions of the Insolvency and Bankruptcy Code 2016 (IBC) andthe regulations made thereunder (IBC).
CORPORATE GOVERNANCE REPORT AND COMPLIANCE CERTIFICATE
As provided under Regulation 27 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a detailed compliance report on corporategovernance is given in a separate section and forms an integral part to this AnnualReport. The requisite certificate from Auditors of the Company confirming compliance withthe conditions of Corporate Governance is attached to the Report on Corporate Governance.
The Chairman and Managing Director and the Chief Financial Officer havecertified to the Board with regard to financial statements and other matters as requiredunder Regulation 17(8) read with Schedule II to the SEBI (LODR) Regulations 2015.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to Regulation 34(3) Part B Schedule V of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a report on managementdiscussion and analysis is given in a separate section and forms an integral part to thisAnnual Report.
DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
Your Directors further state that during the year under review therewere no cases filed pursuant to the sexual harassment of women at workplace (PreventionProhibition and Redressal) Act 2013.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The company has devised a vigil mechanism for directors and employeesto report concerns about unethical behavior actual or suspected fraud or violation of thecompany's code of conduct or ethics policy. This mechanism provides for adequatesafeguards against victimization of director(s) / employee(s) who avail of the mechanismand also provides for direct access to the Chairman of the Audit Committee in exceptionalcases.
During the financial year 2020-21 there were no instances of unethicalbehavior fraud or violation of the company's code of conduct or ethics policy and nopersonnel have been denied access to the audit committee.
The details of establishment of such mechanism are disclosed on thewebsite of the Company viz. www.genuspaper.com.
The properties of your Company comprising buildings plant andmachinery other assets stocks etc. were adequately insured against various risks.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THETIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS ORFINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF DURING THE FINANCIAL YEAR:
Not applicable during the financial year.
The Equity shares of the Company are listed with Bombay Stock ExchangeLtd. (BSE) & National Stock exchange of India Limited (NSE). The annual listing feefor the year 2021-22 was paid within the scheduled time to BSE & NSE.
TRANSFER OF SHARES
As notified under Regulation 40(1) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 except in case of transmission ortransposition of securities requests for effecting transfer of securities shall not beprocessed unless the securities are held in the dematerialized form with a depository.
The Annual Report including those which relate to the Directors'Report Management Discussion and Analysis Report may contain certain statements on theCompany's intent expectations or forecasts that appear to be forward-looking withinthe meaning of applicable securities laws and regulations while actual outcomes may differmaterially from what is expressed herein. The Company bears no obligations to update anysuch forward looking statement. Some of the factors that could affect the Company'sperformance could be the demand and supply for Company's product and serviceschanges in Government regulations tax laws forex volatility etc.
Your Directors wish to place on record their gratitude for theassistance and cooperation extended by company's shareholders suppliers dealersbusiness partners bankers and financial institutions Central and State Government andothers associated with the Company. Your Directors also wish to place on record their deepappreciation to employees at all levels for their hard work dedication and commitment andlook forward to their continued support.
| || ||For and on behalf of Board of Directors |
| || ||For Genus Paper & Boards Limited |
| ||Himanshu Agarwal ||Kailash Chandra Agarwal |
|Place : Moradabad ||Whole Time Director ||Managing Director & CEO |
|Date : 09th August 2021 ||DIN-00065185 ||DIN-00895365 |