The Board of Directors hereby submit the report of the business and operations of yourCompany (the Company' or IIL') along with the audited financial statementsfor the financial year ended March 312018.
1. Financial Results and State of Company's Affairs
ft in Lacs except per equity share data)
|Particulars || |
| ||March 31 2018 ||March 312017* |
|Revenue from Operations ||110639.42 ||107626.90 |
|Other Income ||324.11 ||682.74 |
|Total Income ||110963.53 ||108309.64 |
|Total Expenses ||99153.81 ||100113.01 |
|Profit Before Tax (PBT) ||11809.72 ||8196.63 |
|Less : Tax Expenses ||3412.36 ||2256.73 |
|Profit After Tax (PAT) ||839736 ||5939.90 |
|Other Comprehensive income ||403.47 ||(11.04) |
|Total Comprehensive income ||8800.83 ||5928.86 |
|Key ratios || || |
|Earnings per share (Rs.) ||40.63 ||28.74 |
|Dividend per share (Rs.) ||2.00 ||2.00 |
*Figures are restated as per Ind AS
The Company has adopted Ind AS w.e.f. April 01 2017 with a transition date of April01 2016. Accordingly results for the year ended March 312017 have been prepared inaccordance with Ind AS prescribed under Section 133 of the Companies Act 2013 and otheraccounting principles generally accepted in India. Previous periods figures have beenrestated as per Ind AS to make them comparable.
During the year under review the Revenue of the Company rose to Rs 110639.42/- Lacs asagainst Rs. 107626.90/- Lacs in March 2017 registering a growth of 2.8%. These growthrates are adversely impacted due to lower reported sales by the change in structure ofindirect taxes and reduction in realizations to pass on the GST benefits.
The Company has earned Net Profit Rs. 839736/- Lacs as against the net profit of Rs.5939.90/- Lacs in March 2017 registering a growth of 41.37%. The improvement inperformance of your Company could mainly due to better product mix capacity utilizationongoing emphasis on productivity and efficiency improvement in all areas of operation.
2. Dividend and Reserves
Based on the Company's performance the directors are pleased to recommend for approvalof the members a final dividend of Rs. 2.00/- per share (20%) for FY 2017-18 (Previousyear Rs. 2.00/- per share). The final dividend on equity shares if approved by themembers would involve a cash outflow of Rs. 498.32 Lacs (including Corporate Dividend Taxamounting to Rs. 84.97 Lacs)
The Register of member and share transfer Books will remain closed from July 31 2018to August 08 2018 (both day inclusive) for the purpose of payment of final dividend forthe Financial Year ended March 31 2018.
3. Share Capital
The paid up Equity Share Capital of the Company as on March 312018 was Rs. 2066.78Lacs. There was no change in the Company's Share Capital during the year under review.
4. Credit Rating
The Company enjoys a good reputation for its sound financial management and ability tomeet in financial commitments.
CRISIL a S&P Global Company a reputed Rating Agency has re-affirmed the creditrating of CRISIL A/Stable for the long-term and CRISIL A1 for the Short-term Bankfacilities.
5. Particulars of Loans given Investment made Guarantees given And Securitiesprovided
During the year under review the Company has not made any loan given any guarantee orprovided security in connection with the loan to any other body corporate or person.However the Company has invested in equity shares of OAT & IIL India LaboratoriesPrivate Limited the said company is the Joint Venture of your company w.e.f March 062013 and also invested in the shares of OAT Agrico Co. Ltd. Japan a Joint Venturepartner Company.
Your Company has not accepted any deposits under Section 73 and 74 of the CompaniesAct 2013 ("the Act") and no amount of principle or interest was outstanding asof Balance Sheet date.
7 Subsidiary Company Associate Company And Joint Venture Company
There is no subsidiary Company of the Company during the year under review.
The Company has "OAT & IIL India Laboratories Private Limited" as itsjoint venture company within the meaning of Section 2(6) of the Act as on March 312018.
A highlights of performance of associates and joint venture along with therecontribution to all overall performance of the Company during the period are provided inAnnexure - 1 and hence not repeated here for the sake of brevity.
The Policy for determining material subsidiaries as approved may be accessed on theCompany's website at the link:
8. Consolidated Financial Statements
The Consolidated Financial Statements of the Company for the Financial Year 2017-18 areprepared in compliance with the applicable provisions of the Act Accounting Standards andRegulations as prescribed by Securities and Exchange Board of India SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (SEBI "ListingRegulations").
The Consolidated Financial Statements have been prepared on the basis of the auditedfinancial statements of the Company and its Joint Venture Company as approved by theirrespective Board of Directors.
Pursuant to the provisions of Section 136 of the Act the Financial Statements of theCompany the Consolidated Financial Statements along with all relevant documents and theAuditor's Report thereon form part of this Annual Report. The Financial Statements asstated above are also available on the website www.insecticidesindia.com of the Company.
9. Transfer to Reserves
The Company proposes to retain the entire amount of Rs. 839736/- Lacs in the profit andloss account.
10. Management's discussion and analysis
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 read with Schedule V of the SEBI "Listing Regulations ispresented in a separate section forming part of the Annual Report.
11. Corporate Social Responsibility
The Corporate Social Responsibility Committee (CSR Committee) has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which has been approved by the Board.
The CSR Policy may be accessed on the Company's website at the link: http://www.insecticidesindia.com/Policy/CSR%20Policy%20FINAL.pdf
The key philosophy of all CSR initiatives of the Company is guided by three corecommitments of Scale Impact and Sustainability.
The Company has identified following focus areas for CSR engagement:
Rural Transformation: Creating sustainable livelihood solutions addressingpoverty hunger and malnutrition.
Environment: Environmental sustainability ecological balance conservation ofnatural resources and promoting bio-diversity.
Health: Affordable solutions for healthcare through improved access awarenessand health seeking behavior.
Education and Sports: Access to quality education training and skillenhancement building sports & skills in young students.
Disaster Response: Managing and responding to disaster.
Art Heritage and Culture: Protection and promotion of India's art culture andheritage.
The Company would also undertake other need based initiatives in compliance withSchedule VII to the Act. The annual report on CSR activities is annexed herewith marked asAnnexure - 2.
12. Risk Management
The Company has formulated the Risk Management Policy through which the Company hasidentified various risks like strategy risk industry and competition risk operationrisk liability risks resource risk technological risk financial risk. The Companyfaces constant pressure from the evolving marketplace that impacts important issues inrisk management and threatens profit margins. The Company emphasizes on those risks thatthreaten the achievement of business objectives of the Group over the short to mediumterm. Your Company has adopted the mechanism for periodic assessment to identify analyzeand mitigation of the risk.
The appropriate risk identification method will depend on the application area (i.e.nature of activities and the hazard groups) the nature of the project the project phaseresources available regulatory requirements and client requirements as to objectivesdesired outcome and the required level of detail.
The trend line assessment of risks analysis of exposure and potential impact shall becarried out. Mitigation plans shall be finalized owners identified and progress ofmitigation actions shall be regularly and periodically monitored and reviewed.
Treatment options which are not necessarily mutually exclusive or appropriate in allcircumstances shall be driven by outcomes that include:
Avoiding the risk
Reducing (mitigating) the risk
Transferring (sharing) the risk and
Retaining (accepting) the risk.
The Risk management Policy of the Company is annexed herewith as Annexure - 3 to thisReport.
13. Vigil Mechanism
The Company promotes ethical behaviour in all its business activities and has put inplace a mechanism for reporting unethical behaviour fraud violations or bribery. TheCompany has Vigil Mechanism (Whistle Blower) Policy under which the employees are free toreport violations of applicable Laws and Regulations and the Code of Conduct the same canbe accessed through the Chairman of the Audit Committee. The reportable matters may bedisclosed to the Ethics and Compliance Task Force which operates under the supervision ofthe Audit Committee. Employees may also report to the Chairman of the Audit Committee.During the year under review no such complain has been received and no employee was deniedaccess to the Audit Committee for reporting violations.
14. Disclosure of Remuneration & Particulars Of Employees And Related Disclosures
The information as required in accordance with Section 197(12) of the Act read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 the details regarding the remuneration and other requisite details are mentioned inthe Annexure - 4(a) attached hereto.
No Employee draw the remuneration in excess of limit prescribed under Section 197 ofthe Companies Act 2013 read with rule 5(2) of the Companies (Appointment and ManagerialPersonnel) Rules 2014.
No director of the Company who is receiving commission from the Company is in receiptof any remuneration or commission from any holding company or subsidiary company of theCompany.
The Remuneration Policy of the company is annexed herewith as Annexure - 4(b) to thisReport.
In accordance with the provisions of Section 152 of the Act Shri Hari Chand Aggarwal(DIN: 00577015) Directors of the Company retire by rotation at the forthcoming AnnualGeneral Meeting of the Company and being eligible offer himself for re-appointment. TheBoard of Directors on the recommendation of the Nomination and Remuneration Committee hasrecommended his re-appointment.
Shri Deepak Gupta has ceased to be a Director of the Company w.e.f. January 15 2018.The Board places on record its appreciation towards valuable contribution made by ShriDeepak Gupta during his tenure as a Director of the Company.
The Board of Directors on recommendation of the Nomination and Remuneration Committeehas re-appointed Shri Hari Chand Aggarwal as Chairman and Whole-time Director of theCompany who will attain the age of 70 (Seventy) Years as on November 05 2018 for aperiod of 5 (five) years w.e.f. October 012017 subject to approval of shareholders.
The Board of Directors on recommendation of the Nomination and Remuneration Committeehas re-appointed Smt Nikunj Aggarwal as Whole-time Director of the Company for a periodof 5 (five) years w.e.f. May 02 2018 subject to approval of shareholders
The Board of Directors on recommendation of the Nomination and Remuneration Committeehas revised the remuneration of Shri Rajesh Aggarwal Managing Director with effect fromApril 01 2018. He shall be entitled to receive remuneration based on net profits in formof Commission upto 5% (Five percent) of the net profit which will be determined by theBoard and Committee of the Board for each financial year subject to the approval ofshareholders.
The information of Directors seeking appointment/ reappointment as required pursuant toRegulation 36(3) of SEBI Listing Regulations and Companies Act 2013 is provided in thenotice of the 21st Annual General Meeting of the Company.
All the Independent directors have given declaration that they meet the criteria ofIndependence laid down under Section 149 (6) of the Companies Act 2013 and Regulation16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
16. Meeting of the Board
During the financial year 2017-18 the Board of Directors met 5 (Five) times thedetails of which are given in the Corporate Governance Report that forms the part ofAnnual Report. The notice along with Agenda of each Board Meeting was given in writing toeach Director. The intervening gap between any two meetings was within the periodprescribed by the Act and SEBI Listing Regulations.
17. Performance Evaluation Report
In terms of Companies Act 2013 and SEBI Listing Regulations there is requirement offormal evaluation by the Board of its own performance and that of its committees andindividual directors.
The evaluation of Board of its own performance and that of its committees andindividual directors was conducted based on criteria and framework adopted by the Board.The evaluation criteria have been explained in the Nomination and Remuneration Policyadopted by the Board.
18. Familiarisation Programme for Independent Directors
Pursuant to the provisions of Regulation 25 of the SEBI Listing Regulations theCompany has formulated a programme for familiarising the Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company etc. through variousinitiatives. The details of the aforementioned programme is available on the Company'swebsite at HREF="http://www.insecticidesindia.com/">http://www.insecticidesindia.com/
19. Board Committees
In compliance with the requirements of the Act and SEBI Listing Regulations your Boardhad constituted various Board Committees including Audit Committee Nomination
& Remuneration Committee Stakeholders Relationship Committee Finance Committeeand Corporate Social Responsibility Committee.
Details of the constitution of these Committees which are in accordance withregulatory requirements have been uploaded on the website of the Company viz.HREF="http://www.insecticidesindia/">www.insecticidesindia . com. Details ofscope constitution terms of reference number of meetings held during the year underreview along with attendance of Committee Members therein form part of the CorporateGovernance Report annexed to this report. A detailed report on Corporate SocialResponsibility activities initiated by the Company during the year under review incompliance with the requirements of Companies Act 2013 is annexed to this report.
20. Key Managerial Personnel
The following persons have been designated as Key Managerial Personnel of the Companypursuant to Section 2(51) of the Act read with the Rules framed there under.
1. Shri Hari Chand Aggarwal - Chairman & WTD
2. Shri Rajesh Aggarwal - Managing Director
3. Smt. Nikunj Aggarwal - Whole-time Director
4. Shri Sandeep Kumar - Company Secretary (w.e.f. 18/04/2017)
5. Shri Sandeep Aggarwal - Chief Financial Officer
Shri Sandeep Kumar Appointed as Company Secretary of the Company w.e.f. April 18 2017Shri Sandeep Kumar was previously working with Listed Company based on Madhya Pradesh.
During the year 2017-18 information as mentioned in Part A of Schedule II of SEBIListing Regulations has been placed before the board for its consideration.
21. Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:
a) in the preparation of the annual accounts for the year ended March 31 2018 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 of the Company for the year;
c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) the directors have prepared the annual accounts on a going concern basis.
e) the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively;
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.
22. Contracts Or Arrangements With Related Parties
Your Company has formulated a policy on related party transactions which is alsoavailable on Company's website at the linkHREF="http://www.insecticidesindia.com/Policy/">http://www.insecticidesindia.com/Policy/RELATED%20PARTY%20TRANSACTION%20FINAL.pdf This policy deals with the review and approvalof related party transactions. The Board of Directors of the Company has approved thecriteria for making the omnibus approval by the Audit Committee within the overallframework of the policy on related party transactions. Prior omnibus approval is obtainedfor related party transactions which are of repetitive nature and entered in the ordinarycourse of business and at arm's length. All related party transactions are placed beforethe Audit Committee for review and approval.
All related party transactions entered during the Financial Year were in ordinarycourse of the business and on arm's length basis. No material related party transactionswere entered during the Financial Year by your Company. Accordingly the disclosure ofrelated party transactions as required under Section 134(3)(h) of the Companies Act 2013in Form AOC 2 is not applicable to your Company.
Members may refer to Note No. 37 of the financial statement which sets out relatedparty disclosures pursuant to IndAS-24.
23. Details in respect of adequacy of Internal Financial Controls
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and timely preparation of reliablefinancial disclosures.
24. Details of Significant & Material Orders
No significant and material order has been passed by the Regulators or Courts orTribunals impacting the going concern status of the Company and Company's operations infuture details of which needs to be disclosed in the board's report as Section 134 (3)(q)read with rule 8 of Companies (Accounts) Rules 2014.
25. Material Changes and Commitments
There have been no material changes and commitments affecting the financial position ofthe company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
M/s S S Kothari Mehta & Co. Chartered Accountants (ICAI Regd. No.: 000756N) andM/s Devesh Parekh & Co. Chartered Accountants (ICAI Regd. No.: 013338N) wereappointed as Auditors of the Company at the Annual General Meeting held on August 082017 for term of 5 (Five) consecutive Years. They have confirmed that they are notdisqualified from continuing as Auditors of the Company.
The Notes on financial statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation adverse remark or disclaimer.
During the year under review the Auditors had not reported any matter under Section143 (12) of the Act therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
The Board of Directors had appointed Akash Gupta & Associates Company Secretaries(PCS Regis. No. 11038) to conduct Secretarial Audit for fY 2017-2018. During the yearunder review the company complies with all applicable secretarial standards. TheSecretarial Report given by the Secretarial Auditors is annexed and forms integral part ofthis Report. The Secretarial Audit Report does not contain any qualification reservationadverse remark or disclaimer.
During the year under review the Secretarial Auditors had not reported any matterunder Section 143 (12) of the Act therefore no detail is required to be disclosed underSection 134 (3)(ca) of the Act.
In terms of Section 204 of the Companies Act 2013 the Audit Committee recommended andthe Board of Directors appointed M/s Akash Gupta & Associates Company Secretaries(PCS Registration No.11038) as the Secretarial Auditors of the Company in relation to thefinancial year 201819. The Company has received their consent for appointment.
In terms of the requirement of Section 148 of the Act read with Companies (Cost Recordsand Audits) Rules 2014 the Audit Committee recommended and the Board of Directorsappointed M/s Aggarwal Ashwani K & Associates Cost Accountants as Cost Auditors ofthe Company to carry out the cost audit for the financial year 2018-19. The Company hasreceived their written consent that the appointment is in accordance with the applicableprovisions of the Act and rules framed thereunder. The remuneration of Cost Auditors hasbeen approved by the Board of Directors on the recommendation of Audit Committee and interms of the Companies Act 2013 and Rules thereunder the requisite resolution forratification of remuneration of Cost Auditors by the members has been set out in theNotice of the 21st Annual General Meeting of your Company.
The Cost Audit Report does not contain any qualification reservation adverse remarkor disclaimer.
During the FY 2016-2017 the Cost Auditor has not reported any matter under Section143(12) of the Act therefore no details is required to be disclosed under Section134(3)(ca) of the Act.
27 Corporate Governance
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by the Securities and ExchangeBoard of India (SEBI). The report on Corporate Governance as stipulated under the ListingRegulations forms an integral part of this Report. The requisite certificate from theAuditors of the Company confirming compliance with the conditions of Corporate Governanceis attached to the report on Corporate Governance.
28. Business Responsibility Report
In compliance with Regulation 34 of SEBI Listing Regulations the BusinessResponsibility Report detailing the various initiatives taken by the Company onenvironmental social and governance front is forming a part of this Annual Report. TheBoard of Directors has adopted a Business Responsibility Policy. The said Policy isavailable on Company's website atHREF="http://www.insecticidesindia.com/">http://www.insecticidesindia.com/
29. Conservation Of Energy Technology Absorption Foreign Exchange Earnings &Outgo
In terms of requirement of clause (m) of sub-section (3) of Section 134 of theCompanies Act 2013 read with the Companies (Account)s Rules 2014 the particularsrelating to conservation of energy technology absorption foreign exchange earnings andoutgo as required to be disclosed under the Act are provided in Annexure - 5 to thisreport.
30. Extract of Annual Return
In accordance with Section 134 (3) (a) of the Act an extract of Annual Return of theCompany is annexed herewith as Annexure - 6 to this Report.
31. Disclosure under the Sexual Harassment of Women at the Work Place (PreventionProhibition and Redressal) Act 2013
The Company has in place an Anti-Sexual Harassment Policy (Policy') in line withthe requirements of The Sexual Harassment of Women at the Work Place (PreventionProhibition and Redressal) Act 2013. Your Directors state that during the year underreview no cases of sexual harassment have been reported.
32. Pollution Control
The Company has taken various initiatives to keep the environment free from pollution.It has already installed various devices in the factories to control the pollution.
33. Unclaimed Dividend
As per the Companies Act 2013 dividends that are unclaimed for a period of sevenyears statutorily get transferred to the Investor Education and Protection Fund (IEPF)administered by the Central Government. During the year under review in terms ofprovisions of Investors Education and Protection Fund (Awareness and Protection ofInvestors) Rules 2014
unclaimed dividend for financial year 2009-10 aggregating to Rs.55260/- wastransferred to Investors Education and Protection Fund. As per Regulation 43 of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 no shares are lying in the suspense account of the Company.
The Company has taken the required insurance coverage for its assets against thepossible risks like fire flood public liability marine etc.
35. Nature of Business
There is no change in the nature of business during the period under review.
36. Listing of Securities
The Company's equity shares are listed on BSE Limited & National Stock ExchangeLimited.
37 Cautionary Statement
Statements in the Board's report and the Management Discussion and Analysis Reportdescribing the Company's objectives expectations or predictions may be forward lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include: global and domestic demand and supplyconditions affecting selling prices new capacity additions availability of criticalmaterials and their cost changes in government policies and tax laws economicdevelopment of the country and other factors which are material to the business operationsof the Company.
Your Company has been able to perform efficiently because of the culture ofprofessionalism creativity integrity and continuous improvement in all functions andareas as well as the efficient utilization of the Company's resources for sustainable andprofitable growth.
The Directors hereby wish to place on record their appreciation of the efficient andloyal services rendered by each and every employee without whose whole-hearted effortsthe overall satisfactory performance would not have been possible.
The Directors appreciate and value the contribution made by every member of the IILfamily.
| || ||For and on behalf of the Board |
| || ||Insecticides (India) Limited |
| ||(Rajesh Aggarwal) ||(Hari Chand Aggarwal) |
| ||Managing Director ||Chairman |
| ||DIN - 00576872 ||DIN - 00577015 |
|Place : Delhi || || |
|Dated : May 28 2018 || || |