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Gujarat Alkalies & Chemicals Ltd.

BSE: 530001 Sector: Industrials
NSE: GUJALKALI ISIN Code: INE186A01019
BSE 00:00 | 01 Apr 224.20 0.80
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226.60

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232.60

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NSE 00:00 | 01 Apr 223.30 0.30
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220.10

HIGH

233.40

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OPEN 226.60
PREVIOUS CLOSE 223.40
VOLUME 4169
52-Week high 595.80
52-Week low 165.00
P/E 3.35
Mkt Cap.(Rs cr) 1,647
Buy Price 224.20
Buy Qty 51.00
Sell Price 240.00
Sell Qty 50.00
OPEN 226.60
CLOSE 223.40
VOLUME 4169
52-Week high 595.80
52-Week low 165.00
P/E 3.35
Mkt Cap.(Rs cr) 1,647
Buy Price 224.20
Buy Qty 51.00
Sell Price 240.00
Sell Qty 50.00

Gujarat Alkalies & Chemicals Ltd. (GUJALKALI) - Director Report

Company director report

To

The Members

Your Directors present this 46th Annual Report of the Company on thebusiness and operations of the Company together with Standalone and Consolidated AuditedFinancial Statements (Ind AS based) for the Financial Year ended 31st March2019 and the report of the Auditors thereon.

PERFORMANCE AND FINANCIAL RESULTS

The financial performance of the Company for the year ended 31st March 2019is summarized below:

FINANCIAL RESULTS – SUMMARY AND HIGHLIGHTS

(Rs. in Lakhs)

Particulars

Standalone

Consolidated

2018-19 2017-18 2018-19 2017-18
Revenue from Operations* 316138 245208 316138 245208
Other Income 6077 10575 6077 10575
Profit / (Loss) before Depreciation Finance Cost and 117593 89243 117593 89243
Tax Expense
Less: Depreciation / Amortisation / Impairment 13997 12731 13997 12731
Profit / (Loss) before Finance Cost and Tax Expense 103596 76512 103596 76512
Less: Finance Cost 2094 1490 2094 1490
Share of Profit / (Loss) of Joint Venture - - 123 (80)
Profit / (Loss) before Tax Expense 101502 75022 101625 74942
Less: Tax Expense (Current & Deferred) 32537 21520 32606 21492
Profit / (Loss) for the year (1) 68965 53502 69019 53450
Total Comprehensive Income / (Loss) (2) (15808) (2498) (15808) (2498)
Total (1+2) 53157 51004 53211 50952
Balance of Profit / (Loss) for earlier years 108413 86886 108251 86778
Amount available for Appropriation 177291 139584 177183 139422
Less: Transfer to Reserves 34482 26751 34482 26751
Less: Dividend paid on Equity Shares 4773 3672 4773 3672
Less: Dividend Distribution Tax 981 748 981 748
Balance carried forward 137055 108413 136947 108251
Earning per Share Rs.93.91 Rs.72.85 Rs.93.98 Rs.72.78
Dividend per Share Rs.08.00 Rs.6.50 Rs.08.00 Rs.6.50
Book Value per Share Rs.582.35 Rs.516.58 Rs.582.20 Rs.516.36

*Revenue from Operations for the FY 2017-18 are excluding excise duty to make itcomparable with FY 2018-19 as the same does not form part of revenue after GSTimplementation.

RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS

The highlights of the Company's performance are as under:

At Standalone Level

? The Company has achieved highest ever sales of Rs.3102.32 crores during the year2018-19 as against Rs.2417.70 crores (excluding Excise Duty) in the Previous Year.

? Total production of all the products has increased by 3.42% to 1592093 MTduring the year 2018-19 as against 1539430 MT in previous year.

? Other Operating income has increased by 71.84% to Rs.59.06 crores during the year2018-19 as against Rs.34.37 crores in previous year.

? Other income has decreased by 42.53% to Rs.60.77 crores during the year 2018-19as against Rs.105.75 crores in previous year.

? Gross Profit has increased by 31.77% to Rs.1175.93 crores during the year2018-19 from Rs.892.43 crores in previous year.

? Profit Before Tax has increased by 35.30% to Rs.1015.02 crores during the year2018-19 from Rs.750.22 crores in previous year.

? Profit After Tax has increased by 28.90% to Rs.689.65 crores during the year2018-19 from Rs.535.02 crores in previous year.

At Consolidated Level

? Gross Profit has increased by 32.02% to Rs.1177.16 crores during the year2018-19 from Rs.891.63 crores in previous year.

? Profit Before Tax has increased by 35.60% to Rs.1016.25 crores during the year2018-19 from Rs.749.42 crores in previous year.

? Profit After Tax has increased by 29.13% to Rs.690.19 crores during the year2018-19 from Rs.534.50 crores in previous year.

The Company has achieved highest ever sales in spite of the stiff competition &unstable market conditions during the year. With the margins improved during the year theCompany could achieve Profit Before Tax of Rs.1015.02 crores (previous year Rs.750.22crores). Your Directors are pleased to inform that the Company has continued to deliverexcellent financial performance this year resulting into improved Key Financial Ratios forthe F.Y. 2018-19. Detailed note on the same is forming part of the ‘ManagementDiscussion and Analysis' attached with this Annual Report.

TRANSFER TO RESERVES

The Company has transferred Rs. 34482 Lakhs to the General Reserves Account subject toapproval of Annual Accounts by the Shareholders at this Annual General Meeting (AGM).

MATERIAL CHANGES AND COMMITMENTS

There has been no material changes and commitments which affect the financial positionof the Company which have occurred between the end of the Financial Year 2018-19 and thedate of this Report. There has been no change in the nature of business of the Company.

DIVIDEND

Your Directors are glad to recommend a higher Dividend @ Rs.8.00 per equity share (i.e.80%) as compared to last year's dividend of Rs. 6.50 per equity share (i.e. 65%) on73436928 Equity Shares of the face value of Rs.10/- each fully paid-up for the yearended 31st March 2019. An amount of Rs.1207.61 Lakhs would be paid asdividend distribution tax on the dividend.

The dividend pay-out is in accordance with the Company's "Dividend DistributionPolicy".

ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

Information pertaining to conservation of energy technology absorption foreignexchange earnings and outgo as required under Section 134(3)(m) of the Companies Act 2013read with Rule 8(3) of the Companies (Accounts) Rules 2014 is given in the Annexure-1 tothis report.

SUBSIDIARY JOINT VENTURE OR ASSOCIATE COMPANY

The Company and National Aluminium Company Limited (NALCO) a Government of IndiaEnterprise (a Navratna Company) have jointly incorporated a JV Company viz. GACL-NALCOAlkalies & Chemicals Pvt. Ltd. (GNAL) (CIN U24100GJ2015PTC085247) on 4thDecember 2015 for setting up 266667 MTPA (100%) Caustic Soda Plant and 130 MW Coalbased Power Plant at Dahej Gujarat. The Company holds 60% and NALCO holds 40% in JVCompany. Accordingly GNAL is a subsidiary of the Company. As on 31st March2019 GNAL is not a material subsidiary company of the Company. The Managing Director ofGACL is the Chairman of the JV Company. The Managing Director of GACL does not draw anycommission or any remuneration from GNAL except incidental expenses upto Rs. 2500/- permeeting for attending the meetings of the Board of Directors or Committees thereof. As perSection 129(3) of the Companies Act 2013 read with Rule 5 of the Companies (Accounts)Rules 2014 a separate statement containing the salient features of financial statementof the Joint Venture / Subsidiary Company in Form AOC-1 forms part of the Annual Report.

In accordance with the provisions of Section 136 of the Companies Act 2013 the AnnualReport of the Company containing therein its standalone and consolidated financialstatements have been placed on the Website of the Company at www.gacl.com Further theAudited Financial Statements of the GNAL for the year ended 31st March 2019are also placed on the Website of the Company at www.gacl.com and also at Website of GNALat www.gnal.co.in The interested Shareholders may obtain a physical copy of theaudited financial statements of the Subsidiary Company by sending a request to the CompanySecretary at the Company's Registered Office.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has in place adequate internal financial controls commensurate with thesize and nature of its business. The Company periodically reviews the internal financialcontrols in the light of new statues changes in business models adoption of newtechnology solutions and suggestions for improvements received from employees. During theyear such controls were tested and no reportable material weakness in the design oroperation was observed. For all amendments to Accounting Standards and the new standardsnotified the Company carries out a detailed analysis and presents the impact onaccounting policies financial results including revised disclosures to the AuditCommittee. The approach and changes in policies are also validated with the StatutoryAuditors.

The Company has a stated process and periodicity for physical verification of itsinventory and fixed assets. Any variances are analyzed and accounted post necessaryapprovals.

The Company gets its financial statements reviewed every quarter by its StatutoryAuditors. The accounts of Joint Venture Company is audited and certified by theirStatutory Auditors for consolidation.

None of the auditors of the Company have reported any fraud as specified under secondproviso of Section 143 (12) of the Companies Act 2013 including any statutorymodifications or re-enactments thereof for the time being in force.

CREDIT RATING

Your Company's financial discipline and prudence is reflected in the strong creditrating described by rating agency as per the following particulars:

Instrument Rating Rating Date of Rating
Agency
Long Term Bank CARE CARE CARE Letter No. CARE/ARO/ RL/2018-19/1904 dated 8th October 2018.
Facilities Ratings AA+
Limited (Double
(CARE) A Plus)
Short Term Bank CARE CARE CARE Letter No. CARE/ARO/ RL/2018-19/1906 dated 8th October 2018.
Facilities Ratings A1+
Limited (A One
(CARE) Plus)

During the year under review CARE reaffirmed the above credit ratings and the same hasbeen informed to the Stock Exchanges (BSE & NSE) vide letter dated 8thOctober 2018 and also placed on the Company's Website at www.gacl.com

RISK MANAGEMENT

The Company has constituted Risk Management Committee of Directors w.e.f. 11thFebruary 2016. Shri Rajiv Lochan Jain has been appointed as the Chairman of the Committeew.e.f. 28th September 2018. As on 31st March 2019 below are theMembers of Risk Management Committee:

1. Shri Rajiv Lochan Jain Chairman;

2. Shri J N Godbole; and

3. Shri P K Gera IAS.

The Company has also constituted Internal Risk Management Committee comprising ofSenior Executives of the Company who are heading respective departments viz. FinanceManufacturing Marketing Purchase Project Safety Information Technology HRSecretarial and Legal functions. The Executive Director (Finance) & CFO is theChairman of the Internal Risk Management Committee. The Internal Risk Management Committeereports to the Managing Director and the risks identified by the said Committee along withproposed mitigation actions are discussed periodically on quarterly basis with theManaging Director.

The said Risk Management Committee of Directors was renamed as "RiskManagement-cum-Safety Committee" w.e.f. 10th November 2016 by the Board.The existing Internal Risk Management Committee of Senior Executives of the Companycontinues to function. Out of the various risks identified by the Internal Risk ManagementCommittee the Audit Committee has identified certain critical risks which are reviewedby the Risk Management-cum-Safety Committee Audit Committee and by the Board of Directorsperiodically on quarterly basis. A Report on the steps taken to mitigate those criticalrisks was submitted to the Risk Management-cum-Safety Committee Audit Committee and theBoard of Directors.

Pursuant to provisions of Regulations 17 & 21 of SEBI Listing Regulations andSections 134 & 177 of the Companies Act 2013 ("the Act") and otherapplicable provisions if any of the SEBI Listing Regulations and the Act the Board ofDirectors of the Company has also approved and framed "Risk Management Policy"of the Company.

VIGIL MECHANISM / WHISTLE BLOWER MECHANISM

The Company has formulated a Vigil Mechanism-cum-Whistle Blower Policy("Policy") as per the requirements of Section 177 of the Companies Act 2013 andRegulation 22 of the SEBI Listing Regulations. The Policy is applicable to all Directorsand Employees of the Company.

As per the Policy a whistle blower can make protected disclosures to the Chairman ofthe Audit Committee. During the Financial Year 2018-19 no unethical and improper practiceor any other wrongful conduct in the Company by any person was reported under the saidPolicy. The Vigil Mechanism-cum-Whistle Blower Policy may be accessed on the Company'sWebsite at the weblink :http://www.gacl.com/upload_files/cb476_VIGIL_MECHANISM_CUM_WHISTLE_BLOWER_POLICY.pdf

CORPORATE SOCIAL RESPONSIBILITY

As per the provisions of Section 135 read with Schedule VII of the Companies Act 2013and the Companies (Corporate Social Responsibility Policy) Rules 2014 the Company hasconstituted Corporate Social Responsibility (CSR) Committee and formulated CorporateSocial Responsibility Policy (CSR Policy). The composition of CSR Committee is given inthe Corporate Governance Report.

The CSR Committee has formulated and recommended to the Board a CSR Policy identifyingthe activities to be carried out by the Company and the said CSR Policy was approved bythe Board of Directors at their Meeting held on 23.07.2014. The Board of Directors attheir Meeting held on 26.05.2015 has approved some modifications in the CSR Policyincluding to undertake CSR activities through GACL Education Society (GES). GES is aSociety registered under the Societies Registration Act 1860 and also under the BombayPublic Trust Act 1950. The CSR Policy may be accessed on the Company's Website at thelink: http://www.gacl.com/upload_files/987b0_CSR_POLICY.pdf As per the provisions ofSection 135 of the Companies Act 2013 the statutory amount (i.e. 2% of the average netprofits of the last three financial years) that was required to be spent by the Companyfor various CSR activities during the Financial Year 2018-19 was Rs.8.78 Crores. TheCompany had spent Rs.10.53 Crores towards various CSR activities during the Financial Year2018-19. In this manner your Company has met its obligation under Section 135 of theCompanies Act 2013.

The Annual Report on CSR activities for the Financial Year 2018-19 is annexed herewithas Annexure-2.

DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Appointment / Reappointment / Cessation ofDirectors & Key Managerial Personnel

The Board of Directors of the Company at its Meeting held on 28.05.2019 accepted theresignation of

Shri J N Godbole as an Independent Director of the Company effective from 30.05.2019since he would be attaining age of 75 years in near future. He was appointed as anIndependent Director of the Company w.e.f. 04.03.2009. He has served as an IndependentDirector to the Company for more than 10 years. The Board places on record its sincereappreciations and pays rich tributes for the valuable services rendered and contributionmade by Shri J N Godbole to the Company during his tenure as an Independent Director ofthe Company since 04.03.2009.

The Shareholders of the Company at their 42nd Annual General Meeting (AGM)held on 18.09.2015 had appointed Dr. Rajiv I. Modi as an Independent Director of theCompany for the first term of five years w.e.f. 01.10.2014. Your Directors recommend hisreappointment as an Independent Director for the second term of five years from 01.10.2019pursuant to the provisions of Section 149(10) of the Companies Act 2013 for yourapproval.

The Board of Directors of the Company as recommended by Nomination-cum-RemunerationCommittee at their meetings held on 9th August 2019 approved the appointmentof Shri S.B. Dangayach as an Independent Director of the Company w.e.f. 9thAugust 2019 for a period of five years subject to approval of shareholders at this AGM.Your Directors recommend appointment of Shri S.B. Dangayach as an Independent Director fora period of five years from 9th August 2019 pursuant to the provisions of theCompanies Act 2013 for your approval.

Shri Arvind Agarwal IAS Director will retire by rotation at the ensuing AGM and beingeligible has offered himself for re-appointment. Your Directors recommend hisre-appointment for your approval.

Brief profile of Shri Arvind Agarwal IAS Dr. Rajiv I. Modi and Shri S.B. Dangayachforms part of the Notice of this AGM. Pursuant to provisions of Section 203 of theCompanies Act 2013 Shri P K Gera IAS Managing Director was appointed by the Board asKey Managerial Personnel of the Company effective from 19th February 2016. Dr.H. B. Patel Chief Financial Officer was the Key Managerial Personnel of the Companyeffective from 14th May 2014 up to his retirement on 31st May2019. Shri Vinayak Kudtarkar who was appointed as General Manager (Finance) of the Companyeffective from 1st April 2019 was appointed by the Board of Directors of theCompany at its Meeting held on 28th May 2019 as Chief Financial Officer andalso as Key Managerial Personnel of the Company effective from 1st June 2019vice Dr. H B Patel Chief Financial Officer and Key Managerial Personnel due to hisretirement attaining the age of superannuation. Shri Sanjay S Bhatt Company Secretary isKey Managerial Personnel of the Company effective from 14th May 2014.

The Company has received necessary declarations from the Independent Directorsconfirming that they meet the criteria of independence prescribed under the provisions ofthe Companies Act 2013 and of the SEBI Listing Regulations. In the opinion of the Boardthe Independent Directors fulfill the conditions specified in SEBI Listing Regulations andare independent of the Management.

B. Independent Directors

Attributes Qualifications & Independence of Directors and their Appointment

The Nomination-cum-Remuneration Committee adopted the criteria for determiningqualifications positive attributes and independence of Directors including IndependentDirectors pursuant to the Act and the Rules thereunder. The brief particulars of theDirectors are provided in the ‘Report on Corporate Governance' forming part of thisAnnual Report.

The Articles of Association of your Company provides that the strength of the Boardshall not be less than three and more than fifteen. The Independent Directors of yourCompany have confirmed that (a) they meet the criteria of independence as prescribed underSection 149 of the Act and Regulation 16 of the SEBI Listing Regulations; and (b) they arenot aware of any circumstance or situation which could impair or impact their ability todischarge duties with an objective independent judgement and without any externalinfluence. Further in the opinion of the Board the Independent Directors fulfill theconditions prescribed under the SEBI Listing Regulations and are independent of themanagement of the Company.

C. Board Evaluation

Pursuant to applicable provisions of the Companies Act 2013 and the SEBI ListingRegulations the Board carried out an annual performance evaluation of the Board itsCommittees Individual Directors and Chairperson. The manner in which the evaluation hasbeen carried out has been explained in the Corporate Governance Report.

D. Nomination and Remuneration Policy

The Board has on the recommendation of the Nomination-cum-Remuneration Committeeformulated a Nomination & Remuneration-cum-Board Diversity Policy for selectionappointment of Directors and Senior Management and their remuneration.

Information about the Policy is provided in the Corporate Governance Report and thesaid Policy may be accessed on the Company's Website at the weblink:http://www.gacl.com/upload_files/7e74a_nrbd_policy.pdf

E. Meetings

During the year five (05) Board Meetings and five (05) Audit Committee Meetings wereheld. The details of which are given in the Corporate Governance Report. The interveninggap between the Meetings was within the period prescribed under the Companies Act 2013and SEBI Listing Regulations. Further the composition and terms of reference of AuditCommittee and other Committees are given in the Corporate Governance Report.

During the year under review there were no instances of recommendations of AuditCommittee and other Committees of Directors of the Company which were not accepted by theBoard.

AUDITORS

A. Internal Auditors

M/s. Talati & Talati Chartered Accountants Vadodara were appointed as InternalAuditors for conducting Internal Audit of the Company for the period from 1stJuly 2018 to 30th June 2019.

The Audit Committee the Board of Directors of the Company at their Meetings held on 9thAugust 2019 re-appointed M/s. Talati & Talati Chartered Accountants Vadodara asInternal Auditors for conducting Internal Audit of the Company for the period from 1stJuly 2019 to 30th June 2020.

The Internal Auditors independently evaluate the internal controls adherence to andcompliance with the procedures guidelines and statutory requirements. The Audit Committeeof Directors periodically reviews the reports of the Internal Auditors and the correctiveactions if any are taken by the Management.

B. Statutory Auditors

M/s. Deloitte Haskins & Sells Chartered Accountants Vadodara (Firm Regn. No.117364W) were appointed as the Statutory Auditors of the Company for a period of fiveyears i.e. from the conclusion of 41st Annual General Meeting (AGM) till theconclusion of this 46th AGM. On completion of five years tenure Board ofDirectors of the Company has on recommendation of the Audit Committee in its Meeting heldon 28th May 2019 recommended for the appointment of M/s. K C Mehta & CoChartered Accountants Vadodara (Firm Regn No. 106237W) as the Statutory Auditors of theCompany for a period of five (5) consecutive years from the conclusion of 46thAGM till the conclusion of 51st AGM. You are therefore requested to appointM/s. K C Mehta & Co Chartered Accountants Vadodara as the Statutory Auditors ofthe Company to hold office for the said period.

The Auditor's Report to the Members for the year under review does not contain anyqualification reservation or adverse remark or disclaimer.

C. Cost Auditors

The Board of Directors of the Company at its Meeting held on 28th May 2019has appointed M/s. R K Patel & Co. Cost Accountants Vadodara (Firm Regn. No. 14115)as Cost Auditors for Financial Year 2019-20 as per the provisions of the Companies Act2013 to conduct the Audit of Cost Records maintained by the Company at the remuneration ofRs.495000/- plus applicable GST.

As per the provisions of the Companies Act 2013 your Directors propose the resolutionin the Notice in respect of remuneration of the Cost Auditors for the Financial Year2019-20 for your ratification and approval. The Company maintains necessary cost recordsas specified by Central Government under sub-section(1) of Section 148 of the CompaniesAct 2013 read with the Companies (Cost Records and Audit) Rules 2014.

D. Secretarial Auditors

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. Samdani Shah & Kabra Practicing Company Secretaries to undertake theSecretarial Audit of the Company for the Financial Year 2018-19. The Report of theSecretarial Auditors is annexed herewith as Annexure-3. The Report does not containany qualification reservation or adverse remark or disclaimer.

As per SEBI Circular No. CIR/CFD/CMD1/27/2019 dated 8th February 2019Annual Secretarial Compliance Report for the year ended on 31st March 2019given by M/s. Samdani Shah & Kabra Practicing Company Secretaries as SecretarialAuditors was submitted to Stock Exchanges (BSE & NSE) within prescribed time limit.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Transfer of Dividend and Equity Shares to the Investor Education and Protection Fund

During the Financial Year 2018-19 unclaimed dividend for the Financial Year 2010-11aggregating Rs.1079016/- had transferred to Investor Education and Protection Fund(IEPF). The Company had also transferred Rs.1176175/- to the bank account of the IEPFtowards dividend declared by the Company for the Financial Year 2017-18 for such shareswhich had already transferred to the IEPF.

During the Financial Year 2018-19 the Company has also transferred 26352 EquityShares to the IEPF in respect of which dividend entitlements remained unclaimed for sevenconsecutive years pursuant to the provisions of Section 124 of the Companies Act 2013read with the Investor Education and Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 as amended.

Shareholders may claim their unclaimed dividend for the years prior to and includingthe Financial Year 2010-11 and the corresponding shares if any from the IEPF Authorityby applying in the prescribed Form No. IEPF-5. This form can be downloaded from theWebsite of the IEPF Authority www.iepf.gov.in the access link of which is also availableon the Company's Website www.gacl.com under the section ‘Investors'.

Attention of the Members is drawn that the unclaimed dividend for the Financial Year2011-12 and the corresponding shares will be due for transfer to the IEPF on 24thOctober 2019 for which purpose communication has been sent to the concerned Shareholdersadvising them to claim their dividend. Notices in this regard have also been published innewspapers. Details of such shares are available on the Company's Website under thesection ‘Investors'.

Details of Nodal Officer

In accordance with Rule 7(2A) of Investor Education and Protection Fund Authority(Accounting Audit Transfer and Refund) Rules 2016 the details of Nodal Officer of theCompany for the purpose of coordination with Investor Education and Protection FundAuthority are as under:

Name: Shri Sanjay S Bhatt
Designation: Company Secretary & GM (Legal & CC)
Postal Address: PO : Petrochemicals : 391 346
Dist.: Vadodara (Gujarat)
Telephone No.: 0265- 2232681 / 82
Mobile No.: 7069053850
E-mail ID: cosec@gacl.co.in

The Company has also displayed the above details of Nodal Officer at its Websitewww.gacl.com

CORPORATE GOVERNANCE

The Company has been following the principles and practices of good CorporateGovernance and has ensured compliance of the requirements stipulated under the SEBIListing Regulations.

A detailed report on Corporate Governance for the year under review along withCertificate issued by Practicing Company Secretaries in terms of provisions of the SEBIListing Regulations is attached herewith forming part of this Annual Report.

BUSINESS RESPONSIBILITY REPORT

As per the provisions of the SEBI Listing Regulations Business Responsibility Report(BRR) containing initiatives taken by the Company from environmental social economicresponsibilities of business and governance perspective is annexed herewith as Annexure-4as part of this Annual Report.

PARTICULARS OF EMPLOYEES

The information pertaining to remuneration and other details of employees as requiredpursuant to Section 197 of the Companies Act 2013 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended areprovided in the Annexure-5. Further there was no employee holding 2% or more ofthe Equity Shares of the Company during the Financial Year 2018-19.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The Audit Committee of Directors at its Meeting held on 6th February 2018has accorded omnibus approval to execute transactions with related parties up to the valueof Rs.1 Crore. During the Financial Year the transactions entered into by the Companywith Related Parties were in the ordinary course of business at arm's length price andwithin the omnibus approval granted by the Audit Committee. The Company has not enteredinto contracts/ arrangements / transactions with Related Parties which could be consideredmaterial in accordance with Section 188 of the Act read with the Companies (Meetings ofBoard and its Powers) Rules 2014 and the Policy of the Company on Related PartyTransactions.

Since all the contracts / arrangements / transactions with Related Parties during theyear were in the ordinary course of business and/or the same were at arm's length as wellas under the special omnibus approval route and not being material transaction as definedunder the Act / Rules disclosure in Form AOC-2 under Section 134(3)(h) of the Act readwith Rule 8(2) of the Companies (Accounts) Rules 2014 is not required.

The Policy on Related Party Transactions and Material Related Party Transactions asapproved by the Board of Directors may be accessed on the Company's Website at the weblinkhttp://www.gacl.com/upload_files/1d10d_87407_related_party_tran_policy-1.pdf YourDirectors draw attention of the Members to Note No. 37 to the Financial Statement whichsets out Related Party disclosures.

LOANS GUARANTEES AND INVESTMENTS

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the Notes No. 5671721 & 42(i)(g) ofthe Notes to the Financial Statements.

INSURANCE

The Company has taken adequate insurance for all its properties. The Company has alsotaken necessary insurance cover as required under the Public Liability Insurance Act1991.

LISTING REGULATIONS COMPLIANCE

Your Company's Equity Shares are listed on BSE Ltd. (BSE) and National Stock Exchangeof India Ltd. (NSE) and their listing fees for the Financial Years 2018-19 and 2019-20have been paid and the provisions of the Listing Regulations have been complied with.

ANNUAL RETURN AND EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in prescribed Form No. MGT-9 as required under Section134(3)(a) of the Companies Act 2013 read with Rule 12(1) of the Companies (Management andAdministration) Rules 2014 is annexed herewith as Annexure-6.

The Annual Return for the Financial Year 2017-18 in prescribed Form No. MGT-7 asrequired under Section 92(1) of the Companies Act 2013 read with Rule 11 of the Companies(Management and Administration) Rules 2014 is placed on the Company's Website at weblinkhttp://gacl.com/upload_files/405c1_Form_No_MGT-7_Annual_Return.pdf The same wasfiled with The Registrar of Companies Gujarat (ROC) on Ministry of Corporate Affairs(MCA) portal within prescribed time limit.

DIVIDEND DISTRIBUTION POLICY

The Board of Directors of the Company at its Meeting held on 26th May 2017has adopted "Dividend Distribution Policy" effective from 26th May2017 which is available on the Company's Website at the Weblink http://www.gacl.com/upload_files/a7fec_Dividend_Distribution_Policy.pdfAs per the SEBI Listing Regulations the said "Dividend Distribution Policy" isalso required to be disclosed in the Annual Report of the Company which is annexedherewith as Annexure-7. The dividend recommended by the Board for the year ended 31stMarch 2019 is in accordance with the said Dividend Distribution Policy.

GENERAL INFORMATION

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 deposits covered under Chapter V of the Act.

2. Issue of equity shares with differential rights as to dividend voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company underESOS.

4. Issue of shares Issue of debentures warrants bonds other convertible securitiesor any non-convertible securities.

5. 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.

6. No fraud has been reported by the Auditors to the Audit Committee or the Board.

Your Directors further state that your Company has constituted a Committee forprevention of Sexual Harassment of Women at Workplace named as "Internal ComplaintCommittee-cum-Gender Equality Committee" under the provisions of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013(hereinafter referred as "the said Act") to enquire into complaints andrecommend appropriate action wherever required. During the year under review theCommittee had not received any complaint of sexual harassment.

SECRETARIAL STANDARDS

The Company is in compliance with the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India and approved by the Central Government underSection 118(10) of the Act.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors state that:

a) in the preparation of the Annual Accounts for the Financial Year ended 31stMarch 2019 the applicable accounting standards have been followed;

b) the Directors had selected such accounting policies and applied them consistentlyand made judgments 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 2019 and ofthe profit of the Company for the year ended on that date;

c) the Directors had 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 have prepared the annual accounts on a going concern basis;

e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

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

MANAGEMENT DISCUSSION AND ANALYSIS

A report on Management Discussion and Analysis forms part of the Board's Report and itdeals inter-alia with the Business Operations & Financial Performance Research &Development Expansion & Diversification Risk Management Marketing Strategy Safety& Environment Corporate Social Responsibility Material Development in Human Resourcesetc.

ACKNOWLEDGEMENTS

The Board expresses its gratitude and appreciation to the Government of IndiaGovernment of Gujarat Financial Institutions Insurance Companies Banks other businessassociates Promoters Shareholders and employees of the Company for their continuedsupport. The Directors also gratefully acknowledge all stakeholders of the Company viz.:customers members dealers vendors banks and other business partners for the excellentsupport received from them during the year. The Directors place on record their sincereappreciation to all employees of the Company for their unstinted commitments and continuedcontribution to the Company.

For and on behalf of the Board
Sd/-
(Dr. J N SINGH IAS)
CHAIRMAN
Place: Gandhinagar
Date : 09.08.2019