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Kallam Textiles Ltd.

BSE: 530201 Sector: Industrials
NSE: N.A. ISIN Code: INE629F01025
BSE 00:00 | 03 Feb 10.52 0.28
(2.73%)
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10.25

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10.69

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NSE 05:30 | 01 Jan Kallam Textiles Ltd
OPEN 10.25
PREVIOUS CLOSE 10.24
VOLUME 27475
52-Week high 21.01
52-Week low 9.51
P/E 27.68
Mkt Cap.(Rs cr) 56
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 10.25
CLOSE 10.24
VOLUME 27475
52-Week high 21.01
52-Week low 9.51
P/E 27.68
Mkt Cap.(Rs cr) 56
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kallam Textiles Ltd. (KALLAMTEXTILES) - Director Report

Company director report

TO THE MEMBERS OF THE KALLAM TEXTILES LTD

(Formerly known as Kallam Spinning Mills Ltd.)

Your Directors take pleasure in presenting the 30thAnnual Report covering thehighlights of the finance business and operations of your Company together withStandalone Audited Financial Statements prepared in compliance with Ind AS accountingstandards for the financial year ended March 31 2022.

1. FINANCIAL RESULTS :

The standalone financial results for the year ended 31st March 2022 are summarizedbelow :

Particulars 2021-22 (Rs in Lakhs) 2020-21 (Rs in Lakhs)
Net Sales / Revenue from operations 45089.81 24061.97
Other income 94.13 164.56
Total 45183.94 24226.53
Operating Expenditure 41296.00 24039.19
Profit before Depreciation and amortization expense 3887.94 187.33
Depreciation and amortization expense 1569.93 1524.92
Profit before Exceptional Items and tax 2318.01 -1337.59
Exceptional items 142.81 -
Profit before tax 2175.20 -1337.59
Provision for income tax
i) Current year Tax 386.21 0.78
ii) Deferred Tax -608.00 -548.75
Profit after tax 1181.00 789.62
Earnings per share (' 2/-) 2.76 -1.84

2. FINANCIAL PERFORMANCE STATE OF COMPANY’S AFFAIRS AND FUTURE OUTLOOK

For the period under review (FY 2021-22)the turnover of the company was ' 451.83Crores as against ' 242.26Crores in the previous Financial Year. The profit after tax was' 11.81 Crore as against ' 7.89 Crores in the previous financial year.

More details are available in Management Discussion & analysis report placed at Annexure-I to this report

MANAGEMENT DISCUSSION AND ANALYSIS:

Management Discussion & Analysis Report in line with Regulation 34(3) read withSchedule-V of the SEBI (LODR) Regulations 2015 is placed at Annexure-I to thisreport.

DIVIDEND :

During the financial year the company has not paid any dividend. However the Board hasrecommended the final dividend of ' 0.20 per share (i.e. 10%) on the Equity Shares of theCompany of ' 2/- each for the financial year 2021-22 at the board meeting held on27.05.2022.If the dividend as recommended above is declared by the Members at theensuing Annual General Meeting (‘AGM’) the total outflow towards dividend onEquity Shares for the year would be ' 10562112/-.

AMOUNTS TRANSFERRED TO RESERVES

There is no transfer of amount to the reserves for the period under review

ANNUAL RETURN:

Annual Return of the Company pursuant to Section 92 of the Companies Act 2013 readwith Companies (Manage- ment and Administration) Rules 2014 in the prescribed FormMGT-7 is available at the weblink http://ksml.in/wp-content/uploads/2022/08/MGT-9-2021-22.pdf as Pursuant to Section 92(3) read withSection 134(3)(a) of the Act the Annual Return as on March 31 2022.

3. NUMBER OF MEETINGS HELD OF THE BOARD:

The Board of Directors met 7 (Seven) times during the year 2021-22. The details of theBoard Meetings and the attendance of the Directors are provided in the Report on CorporateGovernance

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

(i) During the year the shareholders has confirmed the re-appointment of Sri.Venkateswara Reddy Poluri (Din: 0018677) as a Managing Director of the company for aperiod of three years w.e.f 29.06.2021.

During the year the shareholders has confirmed the re-appointment of Sri. GurramVenkata Krishna Reddy as a Joint Managing Director of the company for a period of threeyears i.e. 29.06.2021

(ii) Re-appointment of Director under retire by rotation:

During the year the shareholders at the 29th AGM held on 30.09.2021 has approved there-appointment of Mr.M. V. Subba Reddy as a Director of the Company under the retire byrotation as per the provisions of the Companies Act2013.

(iii) Removal of Company Secretary

During the year Mr. Nitin Tirpathi has been removed from the office of Whole timeCompany Secretary of the Company with effect from 07-08-2021.

(iv) Appointment of Company Secretary & Compliance officer

During the year Mr. Golagani Ramesh Kumar was appointmented as Company Secretary andCompliance Officer of the Company with effect from 01-10-2021.

(v) Directors seeking re-appointment under Retirement by rotation:

Mr. G.V. Krishna Reddy Director of the Company who is liable to retire by rotation atthe ensuing AGM pursuant to the provisions of Section 152 of the Companies Act 2013 readwith the Companies (Appointment and Qualification of Directors)

Rules 2014 and the Articles of Association of your Company and being eligible hasoffered himself for reappointment. Appropriate resolution for his re- appointment is beingplaced for your approval at the ensuing AGM.

Statement regarding opinion of the Board with regard to integrity expertise andexperience (including the proficiency) of the independent directors appointed during theyear to be apponted".

Subject to approval of shareholders at the ensuing Annual General Meeting of thecompany the Board has proposed to reappoint Mr. Varanasi Ramgopal as independentDirector of the company for a period of five years w.e.f 27.09.2022 for second term. Mr.Varanasi Ramgopal Independent Director who is supposed to retire at the ensuing AnnualGeneral Meeting and is eligible for re-appointment as per the recommendation of theNomination and Remuneration Committee his reappointment for a second term of another 5(five) consecutive years effective from 29.09.2022 is very much beneficial to the companyand therefore it is desirable to continue to avail his services as an IndependentDirector. Accordingly it is proposed to reappoint Mr. Varanasi Ramgopal as an IndependentDirector of the Company not liable to retire by rotation and to hold office for a secondterm of 5 (five) consecutive years on the Board of the Company.

(vi) Statement on Declaration by the Independent Directors of the Company.

All the Independent Directors of the Company have given declarations under Section149(7) of the Companies Act 2013 that they meet the criteria of independence as laid downunder Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The terms and conditions ofappointment of the Independent Directors are posted on the website of the Companywww.ksml.in.

(vii) Performance Evaluation of the Board its Committees and Separate meeting ofIndependent Directors:

In compliance with the provisions of the Companies Act 2013 and Regulation 17(10) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the performanceevaluation of the Board was carried out during the year under review. More details areavailable in the Corporate Governance Report which forms part of this report.

(viii) Company’s policy on directors’ appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand other matters provided under sub-section (3) of section 178;

Your Company has formulated the Nomination and Remuneration Committee in accordancewith Section 178 of the Companies Act 2013 and Regulation 19 of the LODR Regulations2015. The salient aspects covered in the Nomination and Remuneration Policy has beenoutlined in the Corporate Governance Report which forms part of this report.

(ix) Managerial Remuneration

The information required under Section 197 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofDirectors/ employees of your Company is set out in Annexure - II to this report.

5. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND :

Pursuant to the provisions of section 124 of the companies Act 2013the declareddividends which remained un paid or unclaimed for a period of seven years have beentransferred by the Company to the Investor Education and Protection Fund (IEPF)established by the Central GovernmentThe details of dividends paid by the Company andrespective due dates for transfer of unclaimed dividend to IEPFis available in CorporateGovernance report which forms part of this report.

During the year the company has transferred unclaimed dividend of ' 306019 and 760606n’s shares to IEPF authority with respect to the dividend year 2013-14.

Disclosure with respect to Demat SuspenseAccount / unclaimed suspense account:

Your Company does not have any Unclaimed Shares

6. COMMITTEES OF THE BOARD:

The Board of Directors has the following Committees:

A. Audit Committee

B. Nomination and Remuneration Committee

C. Stakeholders’ Relationship Committee

D. Corporate Social Responsibility Committee.

E. Share Transfer Committee

The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.

9. RISK MANAGEMENT :

The Company has implemented an integrated risk management framework through which theBoard and Audit Committee periodically reviews and assesses significant risks on a regularbasis to help ensure that there is a robust system of internal controls in place. YourCompany believes that managing risks helps in maximizing returns. The Company’sapproach to addressing business risks is comprehensive and includes periodic review ofsuch risks and a framework for mitigating controls and reporting mechanism of such risks.More details on the same are given in the Report on Corporate Governance.

8. DETAILS OF ADEQUACY INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS

Your Company has put in place adequate internal financial controls with reference tothe financial statements and the Company has effective risk- mitigation system keeping inview the size and nature of the business. Your company has adopted accounting policieswhich are in line with the Accounting Standards prescribed in the Companies (AccountingStandards) Rules 2006 and other applicable provisions if any of the Companies Act 2013read with Rule 7 of the Companies (Accounts) Rules 2014. These are in accordance withgenerally accepted accounting principles in India. Changes in policies if any are timelyapproved by the Audit Committee in consultation with the Statutory Auditors.

The main objective of internal control system and process is to test and reviewcontrols appraisal of risks in business processes and benchmarking controls with bestpractices in the industry. The Internal Audit function is entrusted to M/s. Mastanaiah& Co. Chartered Accountants Guntur who submit their reports to the Joint ManagingDirector & CEO and has direct access to the Audit Committee and they participated inthe meetings of the Audit Committee of the Board of Directors of your Company.

The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Audit Committee of the Board of Directors and Statutory Auditors areperiodically apprised of the internal audit findings and corrective actions taken. TheInternal Audit plays a key role in providing assurance to the Board of Directors.Significant audit observations and corrective actions taken by the management arepresented to the Audit Committee of the Board. To maintain its objectivity andindependence of the Internal Audit functions.

9. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

In accordance with the provisions of Section 177(9) of the Companies Act 2013 and theRules made there under and also SEBI (LODR) Regulations 2015 your Company has in place avigil mechanism termed as Whistle Blower Policy for directors and employees to reportconcerns about unethical behavior actual or suspected fraud or violation of theCompany’s Code of Conduct or Ethics Policy which also provides for adequatesafeguards against victimization of director(s)/employee(s) who avail the mechanism andalso provide for direct access to the Corporate Governance Officer/Chairman of the AuditCommittee. The Whistle Blower Policy is also available on your Company’s website(www.ksml.in)

10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY

The Company has duly complied with the provision of Section 186 of the Companies Act2013 and Rules made there under. Details on loans or investment are provided in financialstatements section of this Annual Report. The Company has not given any guarantees toanybody corporate on behalf of a third party.

11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

During the year under review no transaction of material nature has been entered intoby the Company with its Promoters the Directors or relatives etc that may have apotential conflict with the interests of the Company. All related party transactions areplaced before the Audit Committee and also for approval of Board on quarterly basis. Prioromnibus approval of the Audit Committee is obtained on a yearly basis for the transactionswhich are of repetitive nature and entered in the ordinary course of business and are onarm’s length basis.

A Statement giving details of the transactions entered into with the related partiespursuant to the omnibus approval so granted is placed before the Audit Committee and theBoard of Directors for their approval/ratification on a quarterly basis.

The Register of Contracts containing transactions in which directors are interestedif any is placed before the Audit Committee/Board regularly. The Board of Directors ofthe Company on the recommendation of the Audit Committee adopted a policy on RelatedParty Transactions to regulate the transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 and theSEBI (LODR) Regulations 2015.

The Policy as approved by the Board is uploaded on the Company’s website atwww.ksml.in.

The details of the related party transactions as per Accounting Standard- 18 are setout in Notes to Accounts (Note No: -35)of the Financial Statements forming part of thisreport

The details of the Related Party Transactions in prescribed Form AOC-2 pursuant toSection 134(3)(h) of the Companies Act 2013 read with Rule 8(2) of the Companies(Accounts) Rules 2014 are annexed as Annexure -III to this Report

12. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withRule 8 (3) of the Companies (Accounts) Rules 2014 is set out herewith as Annexure -IVto this report.

13. CORPORATE SOCIAL RESPONSIBILITY (CSR)

As per the provisions of Section 135 of the Companies Act 2013 and the Rules madethereunder your Company has put in place a Corporate Social Responsibility Committeewhich comprises of Mr. G.V. Krishna Reddy as Chairman and Mr. Varanasi Ramagopal Mr. M.V.Subba Reddy as members.The Corporate Social Responsibility (CSR) Policy enumerating theCSR activities to be undertaken by the Company in accordance with Schedule VII to theCompanies Act 2013 as adopted by the Board is available on the website of the Companywww.ksml.in.

The Annual Report under CSR Activities is annexed to this report as Annexure -V tothis Report.

The details relating to the meetings convened etc. are furnished in the Report onCorporate Governance.

14. AUDITORS

(i) Statutory Auditors And Their’ Report:

Pursuant to the provisions of Section 139(2) of the Act and the rules made there underthe Members at their 25th AGM held on September 29 2017 had appointed M/s. ChevuturiAssociates Chartered Accountants (Firm Reg No : 000632S) Guntur as the StatutoryAuditors of the Company for a term of five years i.e. from the conclusion of 25th AGMtill the conclusion of the 30th AGM. In view of the aforesaid M/s. Chevuturi Associates.Chartered Accountants would retire to be the Statutory Auditors of the Company at theconclusion of the ensuing AGM. In view of the aforesaid the Board on the recommendationof the Audit Committee ("AC") recommended the appointment of M/s. Brahmayya& Co. Chartered Accountants (Firm Reg. No: 000513S) as the Statutory Auditors of theCompany for a term of five years in accordance with the requirements under the CompaniesAct 2013 to hold office from the conclusion of the ensuing AGM i.e. 30th AGM till theconclusion of the 35th AGM subject to the approval of the Members at the ensuing AGM ofthe Company. M/s. Brahmayya & Co. Chartered Accountants (ICAI Registration No.000513S) have confirmed that their appointment if made will comply with the eligibilitycriteria in terms of Section 141(3) of the Act and RBI regulations. Further the Auditorshave confirmed that they have subjected themselves to Peer Review process by the Instituteof Chartered Accountants of India ("ICAI") and hold valid certificate issued bythe Peer Review Board of ICAI.

Auditors’ Report

The Auditors’ Report to the Members for the year under review is unmodified/clean. The Notes to the Accounts referred to in the Auditors’ Report are self-explanatory and therefore do not call for any further clarifications under Section 134(3)(f) of the Act. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report.

(ii) Cost Auditor:

As per the requirement of Central Government and pursuant to Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) Rules 2014 asamended from time to time your Company has been carrying out audit of cost recordsrelating to Textile and Power Divisions every year. There is no adverse remarkqualification reservation or disclaimer in the Cost Audit Report for the financial yearended 31.03.2022.

The Board of Directors of your Company on the recommendations made by the AuditCommittee at its meeting held on 11th August 2022 had appointed M/s. Sairam &Associates Cost Accountants

(Membership No. 41948) as the Cost Auditor of your Company to carry out audit of costrecords relating to Textile and Power Divisions as required under the Companies Act 2013for the financial year 2022-23 at a remuneration of ' 25000/- plus applicable taxes andout of pocket expenses if any.

Your Company has received consent from M/s. SAIRAM & ASSOCIATES Cost Accountantsto act as the Cost Auditor to carry out the audit of the cost records for the financialyear 2022-23a resolution seeking member’s approval for the remuneration payable tothe Cost Auditor forms part of the Notice convening the Annual General Meeting for theirratification.

MAINTENANCE OF COST RECORDS:

Cost Audit is applicable to the Company. The Company is required to maintain costrecords as specified by the Central Government under sub- section (1) of Section 148 ofthe Act and the rules framed thereunder and accordingly the Company has made andmaintained such cost accounts and records.

EXPLANATIONS OR COMMENTS BY THE BOARD ON EVERY QUALIFICATION RESERVATION OR ADVERSEREMARK OR DISCLAIMER MADE BY THE COST AUDITOR IN HIS REPORT:

The Cost Auditor’s report for the year ended

31.03.2022 does not contain any qualification reservation or adverse remark ordisclaimer in his report

(iii) Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 and Regulation 24A of the SEBI ListingRegulations the Company had appointed M/s. K. Srinivasa Rao & Co CompanySecretaries Guntur to undertake the Secretarial Audit of the Company for FY 2021-22.Further in terms of the provisions of the Circular No. CIR/CFD/CMD1/27/2019 datedFebruary 8 2019 issued by SEBI M/s. K.Srinivasa Rao & Co Company SecretariesGuntur has issued the Annual Secretarial Compliance Report confirming compliance by theCompany of the applicable SEBI Regulations and circulars / guidelines issued there under.The Secretarial Audit Report & Annual Secretarial Compliance report are appended as "Annexure-VI" to this Report. There is no adverse remark qualification reservation ordisclaimer in the Secretarial Audit Report except the execution and reporting ofinformation of trades executed by some of the promotersin thetrading window closing periodunder the company Code of conduct for Prevention of Insider Trading read with Regulation 9of the SEBI (PIT) Regulations 2015.Board’s Reply on following Qualifications ofSecretarial Auditor: The company has informed the trades executed by the promoters to thestock exchange immediately after the receipt of the information about the said trades andalso taken necessary action against the said promoters through issue of warning letterssince there was no material events or unpublished price sensitive information wasavailable in the hands of promoters at the time of execution of the trades.

(iv) Reporting of Frauds by Auditors

During the year under review the Statutory Auditors Cost Auditors and SecretarialAuditors have not reported any instances of frauds committed by the Company or by itsOfficers or Employees to the Audit Committee under Section 143(12) of the Companies Act2013.

15. MATERIAL EVENT RECORDED SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e.March 31 2022 and the date of the Directors’ Report

CASES FILED/DISPOSED PENDING UNDER IBC:

There were no cases filed/disposed/pending against the company under IBC code.

CHANGES IN SHARE CAPITAL

During the current year there has been no change occurred in the capital Structure ofthe company.

16. CORPORATE GOVERNANCE:

A report on Corporate Governance in line with Regulation 34 read with Schedule-V ofSEBI (LODR) Regulations 2015 is appended and annexed as a separate section to thisreport.

The Statutory Auditors of the Company have issued a certificate on Corporate Governancewhich is appended to the Corporate Governance Report.

17. DETAILS OF SUBSIDIARY JOINT VENTURE OR ASSOCIATES

Our Company does not have any material Subsidiary

Company in terms of Regulation 16(1)(c) of SEBI (LODR) Regulations 2015. Accordinglythe financial statements of our Company are not required to be consolidated in accordancewith the applicable Indian Accounting Standards

Company has neither any Associates nor any Joint Ventures as on March 312022

18. PUBLIC DEPOSITS :

During the year under review your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014 (including any statutory modification(s) orre-enactment(s) for the time being in force).

19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There is no material order passed by the regulators or courts or tribunals impactingthe going concern status and Company’s operations in future.

20. ENVIRONMENT AND SAFETY:

The Company is conscious of the importance of environmentally clean and safeoperations. The Company’s policy requires conduct of operations in such a manner soas to ensure the compliances of environmental regulations and preservation of naturalresources for future Generations.

21. OBLIGATION OF YOUR COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:

To prevent sexual harassment of women at work place The Central Government notified"The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013". Under the said Act every Company is required to set up an InternalComplaints Committee to look into complaints relating to sexual harassment at work placeof any women employee.

Your Director’s hereby confirm that they have adopted a policy for prevention ofSexual Harassment of Women at Workplace and have constituted Internal ComplaintsCommittees (ICC). During the year 2021-22 there was no Complaints Received in thisregards.

22. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) of the Companies Act 2013 (including any statutorymodification(s) or re- enactments) for the time being in force) your Directors herebyconfirm that:

(a) In the preparation of the annual accounts for the financial year ended 31st March2022 the applicable Accounting Standards and Schedule III of the Companies Act 2013(including any statutory modification(s) or re-enactment(s) for the time being in force)have been followed and there are no material departures from the same;

(b) For the financial year ended 31st March 2022 the Directors have selected suchaccounting policies and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofyour Company as at 31st March 2022 and of the profit and loss of the Company for thefinancial year ended 31st March 2022;

(c) Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 (includingany statutory modification(s) or re-enactment(s) for the time being in force) forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

(d) Financial statements have been prepared on a "going concern" basis;

(e) proper internal financial controls laid down by the Directors were followed by yourCompany and that such internal financial controls are adequate and operating effectively;and

(f) proper systems to ensure compliance with the provisions of all applicable laws werein place and that such systems were adequate and operating effectively.

23. APPRECIATIONS AND ACKNOWLEDGEMENTS:

Your Directors sincerely convey their appreciation for the unbelievable commitmentsupport dedication hard work enthusiasm and significant contribution made by employeesin ensuring sustained growth of the Company.

Your Directors also take this opportunity to thank all shareholdersClients VendorsBankers Government and Regulatory Authorities and Stock Exchanges for their continuedco-operation.

For and on behalf of Board of Directors
Date : 11-08-2022 Sd/- Sd/-
Place : Chowdavaram Guntur G.V. Krishna Reddy P. Venkateswara Reddy
Joint Managing Director Managing Director
DIN: 00018713 DIN : 00018677

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