To The Members
The Directors of your Company have pleasure in presenting the 34th AnnualReport of the Company together with Audited Accounts for the financial year ending 31stMarch 2021.
1. FINANCIAL HIGHLIGHTS
| || |
| ||2020-21 ||2019-20 ||2020-21 ||2019-20 |
|Revenue from Operations ||52604.52 ||74422.62 ||52604.52 ||74506.63 |
|Other Income ||758.64 ||424.62 ||765.53 ||424.62 |
|Total Revenue ||53363.16 ||74847.24 ||53370.05 ||74931.25 |
|Profit before Exceptional item depreciation interest & Tax (PBDIT) Interest & other ||6617.10 3465.87 ||7148.30 3804.39 ||6619.05 3465.87 ||7150.23 3804.39 |
|financial expenses Profit before depreciation & Tax (PBDT) ||3151.23 ||3343.91 ||3153.18 ||3345.84 |
|Depreciation and amortization expenses ||2525.15 ||2223.04 ||2525.15 ||2223.04 |
|Profit before Tax and Exceptional item ||626.08 ||1120.87 ||628.03 ||1122.80 |
|Exceptional Item ||- ||- ||- ||- |
|Profit before Tax (PBT) ||626.08 ||1120.87 ||628.03 ||1122.80 |
|Tax Expenses- Current ||- ||50.35 ||- ||50.35 |
|Deferred ||- ||- ||- ||- |
|Profit after Tax (PAT) ||626.08 ||1070.52 ||628.03 ||1072.45 |
|Other Comprehensive Income ||49.93 ||15.79 ||47.95 ||11.89 |
|Total Comprehensive Income for the period ||676.01 ||1086.31 ||675.98 ||1084.34 |
|Earning per share-Basic ||0.46 ||0.79 ||0.46 ||0.79 |
|Diluted ||0.46 ||0.79 ||0.46 ||0.79 |
Note: The financial statements of the Company for the year ended 31st March 2021 hasbeen prepared in accordance with Indian Accounting Standards (Ind AS).
Production & Sales Review:
The Company has achieved production of 25317 MT of Acrylic Fibre and sale of 14406 MTduring the year under review as against production of 36699 MT and sale of 21894 MTrespectively during the previous year.
The Company has also achieved production of 11213 MT of Acrylic Yarn and sale of 11767MT during the year under review as against production of 14555 MT and sale of 13352 MTduring the previous year. The total revenue from operations during the year under reviewwas '52604.52 lakh as against '74422.62 lakh during the previous year. Export Sales havefallen this year to '40.94 Crore as against '184.29 Crore in the previous year. DomesticSale have also fallen to '485.10 Crore against '559.94 Crore in the previous year. Hefurther informed that majority (90%) exports of acrylic fibre from India are to Iran anddue to strict USA sanctions effective from 08.04.2020 export orders have dried up.Company is working on new markets to increase exports. Profitability:
The Company earned gross profit before depreciation interest exceptional item and taxof '6617.10 lakh as against '7148.30 lakh in the previous year. After providing fordepreciation of '2525.15 lakh (Previous Year '2223.04 lakh) Interest and Financialcharges of '3465.87 lakh (Previous Year '3804.39 Lakh) the net profit from operationsafter comprehensive income worked out to '676.01 lakh as compared to net profit of'1086.31 lakh in the previous year. The performance in the first half of the year wasadversely affected by Covid- 19 pandemic. Thereafter the retail activity in the textilesector and consumer confidence has improved and thus our production & sales hadimproved in the second half of the year. The Company has been able to close the year on apositive note with net profit of '676.01 Lakh. Segment-wise/Product wise Performance:
Over the last few years your company has been successful in its goal of diversifyingrevenues to tap new opportunities and reduce any risks of an overly concentratedportfolio. Company is manufacturing both acrylic fiber and yarn. During 2020-21 salerevenue from yarn segment is more than 10% of the total revenue of the Company. Thetreatment for the same is enunciated in the Indian Accounting Standard on segmentreporting (Ind AS-108) and is explained under Para no. 6 of the Note No.26 on Notes onAccounts forming part of Annual Report.
2. IMPACT OF COVID-19 PANDEMIC
The Company's operations have been adversely impacted by the outbreak of COVID-19pandemic in the first half of the year as consequent lockdown was announced by Central andState G ove rn me nts d u e to w h ich th e o pe rat i o n s we re resumed onlygradually with prescribed regulations and precautions. For the Company the focusimmediately shifted to ensuring the health and wellbeing of all employees. HoweverCompany has managed to improve its performance in second half of the year and has closedthe financial year with profit. Covid-19 still poses as a threat not only on the humanlife but on businesses and industrial activity across the globe which will be realizedonly over next few months. The Company has been monitoring the situation closely and hastaken proactive measures to comply with various directions/ regulations/ guidelines issuedby the Government and local bodies to ensure safety of workforce across all its plants andoffices.
As Company does not have any distributable profits computed under provisions ofCompanies Act 2013 no dividend is being recommended.
There is no change in Capital Reserves Securities Premium Reserves and GeneralReserves during the year which stands at '1764.44 lakh '39.23 lakh and '80.00 lakhrespectively.
5. RESEARCH AND DEVELOPMENT
The Company has an In-House R & D centre registered with the Ministry of Science& Technology Govt. of India.
During the year the Company has focused on new varieties on dyed yarns. This will helpin growth of sales in the current year. The Company is also working for energyconservation and reduction in the fuel cost with the help of in-house R&D.
6. DETAILS OF SUBSIDIARY. JOINT VENTURES OR ASSOCIATE COMPANY
The Company has a Wholly Owned Subsidiary Company Carlit Trading Europe S.L.U (Spain)for production of sale of its products in the European market.
A separate statement containing the salient features of financial statements of thesubsidiary Company forms part of the Annual report in the prescribed Form AOC-1 incompliance with Section 129 and other applicable provisions if any of the Companies Act2013. Further in line with the SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015 and in accordance with Indian Accounting Standard 110 ConsolidatedFinancial Statements including financial information of its Subsidiary forms part ofthis Annual Report.
The Company is not having any other Joint Venture or Associate Company.
7. CORPORATE SOCIAL RESPONSIBILITY AND GOVERNANCE COMMITTEE
Vision & core areas of CSR:
Your Company is committed to and is fully aware of its Corporate Social Responsibility(CSR) the guidelines in respect of which were more clearly laid down in the recentlyoverhauled Companies Act 2013. Corporate Social Responsibility and Governance Committee(CSR&G Committee) comprises of Shri Rajinder Kumar Garg as its Chairman Shri DheerajGarg and Shri Ajit Singh Chatha as members. This Committee has framed the CSR Policy forthe Company which is approved by the Board and may be accessed on the website of theCompany at http:/www.indianacrylics.com
Since the Company does not have net profits in accordance with Section 198 of theCompanies Act 2013 the Company is not required to undertake any activity under CSRRules.
8. CORPORATE GOVERNANCE
Your Company is continuously taking steps to attain higher levels of transparencyaccountability and equity in order to enhance customer satisfaction and stakeholdersvalue. The Company not only complies with the regulatory requirements but is alsoresponsive to the stakeholders as well as customers needs. The Company alreadyhas an Audit Committee a Stakeholder Relationship Committee and Nomination andRemuneration Committee duly constituted by the Board to look after various activities. TheCorporate Governance practices followed by the Company are enclosed as Annexure to thisreport. A certificate from the Statutory Auditors of the Company regarding compliance ofgovernance norms stipulated under SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
is also annexed to the Corporate Governance report.
9. ANNUAL RETURN
Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act 2013 the Companyhas placed a copy of the Annual Return as at March 31 2021 on its website atwww.indianacrylics.com. By virtue of amendment to Section 92(3) of the Companies Act2013 the Company is not required to provide extract of Annual Return (Form MGT-9) as partof the Boards report.
10. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Directors confirm that:
A. in the preparation of the annual accounts for the year ending 31st March 2021 theapplicable accounting Standards had been followed along with proper explanation relatingto material departures;
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 at the end of the financial year and ofthe profit and loss of the Company for that period;
C. the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
D. the Directors had prepared the annual accounts on a going concern basis; and
E. the Directors had laid down internal financial control to be followed by the Companyand that such internal financial controls were adequate and were operating effectively.
F. the Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
A) Changes in Directors and Key Managerial Personnel
Since the last Annual General Meeting following changes have taken place in the Boardof Directors:
- Shri Alok Goyal (DIN-08049515) is reappointed as Executive Director (Works) of theCompany for a further period of three years w.e.f. 01.03.2021 as his earlier tenure gotcompleted on 28.02.2021.
As per the provisions of Companies Act 2013 Shri Suresh Kumar Singla (DIN-00051799)Director retires by rotation at the forthcoming Annual General Meeting and beingeligible offers himself for reappointment.
Familiarisation programmes for Board Members:
The Board members are from time to time provided with necessary documents/ policies/internal procedures to get them familiar with the practices of the Company. Directors getan opportunity to visit Companys plant which helps them to understand businessoperations & working of the Company. The business strategies performance globaldevelopments legal & other updates compliance reports and other relevantinformation/reports etc. are being periodically provided to the Board of Directors.
B) Declaration by an Independent Director(s) and re-appointment if any
A declaration by Independent Directors stating that he/ they meet the criteria ofindependence as provided in sub-section (6) of Section 149 of the Companies Act 2013 hasbeen taken at the time of their appointment.
C) Formal Annual Evaluation of Board
The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India("SEBI") under Regulation 4(f)(ii) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of the criteria such as composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution the individual director to the Board and
committee meetings like preparedness on the issue to be discussed meaningful andconstructive contribution and inputs in meetings etc. In addition the Chairman was alsoevaluated on the key aspects of his role.
In a separate meeting of Independent Directors performance of nonindependentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and non-executivedirectors the same was discussed in the Board meeting that followed the meeting of theIndependent Directors at which the performance of the Board its committees andindividual directors was also discussed.
12. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS During the year under review 4 BoardMeetings were held one each on 07th July 2020 15th September 2020 15th October 2020and 07th January 2021.
13. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATON AND OTHER DETAILS
The Companys policy on Directors appointment and remuneration and othermatters provided in Section 178(3) of the Act has been disclosed in the corporategovernance report which forms part of the Directors Report.
14. EMPLOYEE STOCK OPTION SCHEME
Your Company had introduced Employee Stock Option Scheme framed in accordance withSecurities and Exchange Board of India (Share Based Employee Benefits) Regulations 2014titled "Indian Acrylics Limited -Employees Stock Option Scheme 2016 ("IAL-ESOS2016") during the financial year 2015-16 which was approved by the Board ofDirectors of the Company and subsequently by the shareholders of the Company in theirAnnual General Meeting held on 29th September 2016.
No options under the said scheme have been granted to the employees of the Companyduring the year under review.
15. AUDIT COMMITTEE
The Audit Committee comprises of three non-executive Directors viz. Rear Admiral M. M.Chopra AVSM (Retd.) Shri Ajit Singh Chatha Raja Shivdev Inder Singh and one ExecutiveDirector Shri Dheeraj Garg. During the year the committee held four meetings. Otherdetails of the Audit Committee are included in the Corporate Governance Report which formspart of this report.
The Board had accepted all recommendation of the Audit Committee.
16. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY FOR DIRECTORS ANDEMPLOYEES
Pursuant to provisions of Section 177 (9) of the Companies Act 2013 the Company hasestablished a "Vigil Mechanism" incorporating Whistle Blower policy in terms ofRegulation 22 of SEBI (LODR) Regulations 2015 for employees and directors of the Companyfor expressing the genuine concerns of unethical behavior frauds or violation of thecodes of conduct by way of direct access to the Chairman/Chairman of the Audit Committee.The Company has also provided adequate safeguards against victimization of employees andDirectors who express their concerns. The policy on "Vigil Mechanism and WhistleBlower" may be accessed on the Companys website athttp//www.indianacrylics.com.
There are no cases reported during the year.
17. NOMINATION AND REMUNERATION COMMITTEE
The committee has been constituted to review and recommend compensation payable to thewhole-time directors including Managing Director and senior management of the Company. Thecommittee reviews the overall compensation structure and policies of the Company with aview to attract retain and motivate employees reviewing compensation levels of theCompany vis-a-vis other Companies and industry in general. The "Nomination &Remuneration Policy" may be accessed on the Companys website athttp//www.indianacrylics.com
18. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
There were no Loans/ Guarantee given or Investments made by the Company during the yearexceeding the limits prescribed under Section 186 of the Companies Act 2013.
19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All contracts/ arrangements/ transactions entered by the Company during the FinancialYear with related parties were in the ordinary course of business and on an armslength basis during the year the Company had not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions. A statement
in summary form of transactions with related parties in ordinary course of businessand arms length basis is periodically placed before the audit committee for review.
The policy on materiality of related party transactions and dealing with related partytransactions as approved by the board is uploaded on the website of the Company.
Disclosures as required under Indian Accounting Standards (Ind AS-24) have been made inthe financial statements of the Company enclosed with this report.
20. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review as stipulated underRegulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 forms part of the Boards report.
21. BUSINESS RISK MANAGEMENT
The risk management includes identifying types of risks and its assessment riskhandling and monitoring and reporting which in the opinion of the Board may threaten theexistence of the Company. The Risk Management Committee constituted by the Board comprisesof Shri R K Garg Shri Dheeraj Garg Raja Shivdev Inder Singh and Shri Surinder Kansal asmembers. The Committee has formulated the Risk Management Policy which was subsequentlyapproved by the Board of Directors. The Risk Management Policy may be accessed on thewebsite of the Company at http://www.indianacrylics.com
A. Statutory Auditors:
As per the Provisions of Section 139 of Companies Act 2013 M/s AKR & AssociatesChartered Accountants were appointed as Statutory Auditors of the Company to hold officetill the conclusion of Annual General Meeting to be held in the calendar year 2022(subject to ratification of their appointment at every AGM). The Company has received acertificate from them pursuant to Companies (Audit & Auditors) Rules 2014 read withSection 139 & 141 of the Companies Act 2013 confirming their eligibility forreappointment and that they were not disqualified for reappointment.
In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to beratified at every Annual General Meeting.
B. Secretarial Auditor:
M/s S.K. Sikka & Associates practicing Company Secretaries Chandigarh wasappointed as Secretarial Auditor & his report in Form No. MR-3 under Section 204 ofthe Companies Act for the Financial Year 2020-21 is attached & forms part of thisReport.
C. Cost Auditor:
As per provisions of Section 148 of the Companies Act 2013 the Board of Directors ofyour Company has recommended M/s Aggarwal Vimal & Associates Cost Auditor to bere-appointed as a Cost Auditor for the Financial Year 2021-22 subject to ratification ofhis appointment and remuneration by the Shareholders in the forthcoming Annual GeneralMeeting.
D. Internal Auditor:
Pursuant to provisions of Section 138 of the Companies Act 2013 the Company hasappointed Mr. Manoj Kumar (ICWA) to conduct internal audit of the functions andactivities of the Company and maintain internal control systems of the Company.
23. AUDITORS REPORT
The Statutory and Secretarial Auditors Reports are self-explanatory and requireno comments.
24. LISTING OF SHARES
Equity shares of the Company are listed on BSE Limited and Listing fee has already beenpaid in pursuance to Regulation 14 of SEBI (LODR) Regulations 2015.
Effective from 25th September 2000 the equity shares of your Company are beingcompulsorily traded in dematerialized form. As on 31st March 2021 a total of 1263 lacsequity shares representing 93.33% of equity share capital have been dematerialized.
All the assets of the Company have been adequately insured.
27. PARTICULARS OF EMPLOYEES
Relations with the employees continued to be peaceful and harmonious during the periodunder review.
28. PERSONNEL & RELATED DISCLOSURES:
Your Company continues to lay emphasis on continued qualitative growth of its humanresources by providing a congenial and conducive work environment in consonance with itsbelief that the real strength of
its organization lies in its employees.
The particulars required under Section 197 read with Rule 5 (1) 5 (2) & 5
(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 including statement of employees receiving salary of '102 lakh. per annum or '8.50lakh per month or more during the Financial Year 2020-21 are annexed hereto and formspart of this report.
29. INDUSTRIAL RELATIONS
Industrial relations continued to be cordial during the year under review.
30. HEALTH SAFETY AND ENVIRONMENT PROTECTION
Our Company has complied with all the applicable health & Safety standardsenvironment laws and labour laws and has been taking all necessary measures to protect theenvironment and provide workers a safe work environment. Our Company is committed forcontinual improvement in Health & Safety as well as Environmental performance byinvolving all the employees to provide a Safe & healthy work environment to all itsemployees.
31. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION. PROHIBITIONAND REDRESSAL) ACT 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framedthereunder. During the financial year 2020-21 the Company has not received any complainton sexual harassment and hence no complaints remain pending as of 31st March 2021.
32. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
The optimal utilization of energy remained a major focus area and a number of stepswere taken in this direction. The information required under Section 134 (3)(m) of theCompanies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 areattached hereto and forms part of this report.
33. GENERAL DISCLOSURE:
Your directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights to dividend voting or otherwise.
2. Details relating to deposits covered under Chapter V of the Act.
3. No material changes and commitments affecting the financial position of the Companyoccurred between the end of the Financial Year to which this financial statements relateand the date of this report.
4. No significant/material orders have been passed by any Regulator/ Court/ Tribunalwhich could impact the going concern status & future operations of the Company.
5. No change in nature of Business of the Company.
6. No unclaimed Dividend is required to be transferred to Investor Education andProtection fund.
Your Directors are pleased to place on record their sincere gratitude to the GovernmentAuthorities Financial Institutions & Bankers and Investors for their continued andvaluable co-operation and support to the Company.
Your Directors express their deep appreciation for the devoted and sincere efforts putin by the employees at all levels of operations in the Company during the year. TheCompany feels confident of continued cooperation and efforts from them in future also.
| ||On Behalf of the Board of Directors |
|Place: Chandigarh ||ALOK GOYAL ||R.K. GARG |
|Dated: 30th April 2021 ||Executive Director ||Managing Director |
| ||DIN : 08049515 ||DIN : 00034827 |