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Kamdhenu Ltd.

BSE: 532741 Sector: Metals & Mining
NSE: KAMDHENU ISIN Code: INE390H01012
BSE 00:00 | 17 Sep 195.50 -5.55
(-2.76%)
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NSE 00:00 | 17 Sep 195.60 -5.45
(-2.71%)
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OPEN 201.00
PREVIOUS CLOSE 201.05
VOLUME 10060
52-Week high 213.15
52-Week low 65.40
P/E 19.99
Mkt Cap.(Rs cr) 527
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 201.00
CLOSE 201.05
VOLUME 10060
52-Week high 213.15
52-Week low 65.40
P/E 19.99
Mkt Cap.(Rs cr) 527
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kamdhenu Ltd. (KAMDHENU) - Director Report

Company director report

Dear Member(s)

The Board of Directors of your Company takes pleasure in presenting the Twenty FifthAnnual Report on the business and operations of the Company together with the auditedFinancial Statements and the Auditor's Report thereon for the financial year ended 31stMarch 2019.

The results of operations for the year under review are given below:

1. FINANCIAL HIGHLIGHTS OF THE COMPANY

(Rs. in Lakhs)

Particulars F.Y 2018-19 F.Y 2017-18
Revenue from Operations 123239.62 118732.52
Other Income 37.64 71.44
Total Revenue 123277.26 118803.96
Total Expenses 119782.65 116362.93
Profit before Exceptional Items and Tax 3494.61 2441.03
Total Tax Expenses 1247.55 874.28
Profit for the Year 2247.06 1566.75
Total Comprehensive Income for the Year 2255.87 1541.49
Paid up Capital 2640.00 2340.00
Earnings per Share of face value of Rs.10 Each Basic (In Rs.) 8.98 6.70
Diluted (In Rs.) 8.90 6.69

2. OPERATING RESULTS AND BUSINESS OPERATIONS AND STATE OF AFFAIRS OF THE COMPANY

The Annual Audited Financial Statements for the year have been prepared in accordancewith the Companies (Indian Accounting Standards) Rules 2015 (Ind-AS) prescribed underSection 133 of the Companies Act 2013 and other recognized accounting practices andpolicies to the extent applicable. Necessary disclosures as regards to the key impactareas & other adjustments upon transition to Ind-AS reporting have been made under theNotes to Financial Statements.

Your Company's revenue from operations reached Rs.123239.62 Lakhs during the yearunder review as against Rs.118732.52 Lakhs during the previous financial year a growthof around 4% year on year. The total income also increased by around 4% fromRs.118803.96 Lakhs in FY 2017-18 to Rs.123277.26 in FY 2018-19.

The operating total expenses in FY 2018-19 increased by around 3% to Rs.119782.65Lakhs as compared to Rs.116362.93 Lakhs in FY 2017-18 mainly on account increase insales volume and consequent expenses.

Profit before Exceptional Items and Tax recorded at Rs.3494.61 Lakhs in FY 2018-19compared to Rs.2441.03 Lakhs in FY 2017-18. Profit for the Year recorded at Rs.2247.06Lakhs in FY 2018-19 compared to Rs.1566.75 Lakhs in FY 2017-18. Total ComprehensiveIncome for the Year recorded at Rs.2255.87 Lakhs in FY 2018-19 compared to Rs.1541.49Lakhs in FY 2017-18.

Basic Earnings per Share (EPS) reached Rs. 8.98/- compared to Rs. 6.70/- in theprevious year.

The Company considers its business segments as the primary segments to monitor theperformance of each of its business segments on regular basis and therefore these havebeen considered as reportable segments under Ind-AS 108 on Segment Reporting. Thereportable Segments represent "Steel" and "Paints". The financialnumbers given below for each of the business segments are as per Ind-AS.

(Rs. in Lakhs)
Particulars Year ended 31st Mar 2019 Year ended 31st Mar 2018
Segment Revenue
- Steel 96256.99 98607.94
- Paints 26982.63 20124.58
Gross Revenue from Operations 123239.62 118732.52
Segment Results
- Steel 5462.93 4552.67
- Paints 820.04 701.14
Profit/(Loss) before finance cost.Tax and unallocable items 6282.98 5253.81
Less: Finance cost 1150.94 1231.15
Less: Other Unallocable Expenditure net of Income 1637.43 1581.63
Total Profit before Tax 3494.61 2441.03
Segment Assets
- Steel 21077.55 19523.20
- Paints 19911.18 17429.81
- Unallocable 525.37 539.17
Total Segment Assets 41514.10 37492.18
Segment Liabilities
- Steel 6676.71 8886.16
- Paints 15734.86 13285.20
- Unallocable 988.23 960.98
Total Segment Liabilities 23399.80 23132.34

3. DIVIDEND

Your Company has a consistent & impressive track record of dividend payment. TheBoard had remained consistent in Dividend Policy of the Company in its meeting held on 2ndMay 2019. In line with its aforesaid Dividend Policy the Board has recommended a finalDividend of Rs.1/- per equity share in its meeting held on 2nd May 2019 which will bepaid subject to approval by the shareholders at the ensuing Annual General Meeting. Thedividend if declared in the Annual General Meeting shall be paid on or before 30thOctober 2019.

The total dividend pay-out (including Dividend Distribution tax) during the currentyear is Rs.286.45 Lakhs as against Rs.222.52 Lakhs for the previous year.

The Register of Members and Share Transfer Books of the Company shall remain closedfrom 22nd September 2019 to 30th September 2019 (both days inclusive) for the purpose ofpayment of final dividend for the financial year ended 31st March 2019 and the AnnualGeneral Meeting. The Annual General Meeting is scheduled to be held on 30th September2019.

4. TRANSFER TO RESERVES

The Company has not transferred any amount to the General Reserve for the financialyear ended 31st March 2019.

5. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION BETWEEN THE END OFFINANCIAL YEAR AND DATE OF THIS REPORT

Your Directors would like to inform that no material changes and commitments haveoccurred between the end of the financial year under review and the date of this reportthat may adversely affect the financial position of the Company. As required under section134(3) of the Act the Board of Directors informs the members that during the financialyear there have been no material changes.

6. SHARE CAPITAL

During the year under review the Company issued & allotted 3000000 equity shares(1000000 shares on 12th April 2018 & 2000000 shares on 5th January 2019) at anissue price of Rs.100 each on conversion of convertible warrants issued on Preferentialbasis on 6th July 2017. Pursuant to the above allotment the issued & paid-up equityshare capital of the Company increased to & stood as on 31st March 2019 atRs.264000000 divided into 26400000 equity shares of Rs.10/- each fully paid up. Outof those 3000000 fresh shares allotted as aforesaid listing of 2000000 shares ispending before the stock exchanges.

At present the Company's shares are listed on BSE Ltd. (BSE) & National StockExchange of India Ltd. (NSE) with effect from 9th May 2006 post its initial publicoffering (IPO).

7. DEPOSITS

During the year under review your Company has not invited or accepted any Depositsfrom the public/ members pursuant to the provisions of Sections 73 and 76 of the CompaniesAct 2013 read together with the Companies (Acceptance of Deposits) Rules 2014.

8. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

During the year under review the Company has not made any loans or guarantee orprovided any security or made any investments pursuant to the provisions of Section 186 ofthe Companies Act 2013 read with Rules made thereunder.

9. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

As per the provisions of the Act and the Listing Regulations your Company hasformulated a Policy on Related Party Transactions which is also available on Company'swebsite at https://www.kamdhenulimited . com/code-conduct.php.

This Policy is intended to ensure due and timely identification approval disclosureand reporting of transactions between the Company and any of its Related Parties incompliance with the applicable laws and regulations as may be amended from time to time.The provisions of this Policy are designed to govern the approval process and disclosurerequirements to ensure transparency in the conduct of Related Party Transactions in thebest interest of the Company and its shareholders and to comply with the statutoryprovisions in this regard. This Policy specifically deals with the review and approval ofMaterial Related Party transactions keeping in mind the potential or actual conflicts ofinterest that may arise because of entering into these transactions.

The Company has not entered into any transaction with related party as mentioned inSection 188 of the Companies Act 2013 during the period under review. Accordingly thereis no transaction which required to be reported in Form AOC-2.

10. CORPORATE GOVERNANCE REPORT MANAGEMENT DISCUSSION & ANALYSIS AND OTHERINFORMATION REQUIRED UNDER THE COMPANIES ACT 2013AND SEBI (LISTING OBLIGATIONS ANDDISCLOSURE REQUIREMENTS) REGULATIONS 2015

Corporate Governance

Your Company always places a major thrust on managing its affairs with diligencetransparency responsibility and accountability thereby upholding the important dictumthat an Organization's corporate governance philosophy is directly linked to highperformance. The Company understands and respects its fiduciary role and responsibilitytowards its stakeholders and society at large and strives to serve their interestsresulting in creation of value for all its stakeholders.

In terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a separate section on "Corporate Governance" with a detailedcompliance report on corporate governance and a certificate from M/s. ChandrasekaranAssociates Company Secretaries Secretarial Auditors of the Company regarding complianceof the conditions of Corporate Governance forms part of this Annual Report. The report onCorporate Governance also contains certain disclosures required under the Companies Act2013. Annexed as Annexure-V to this report.

Management Discussion & Analysis

The Management Discussion & Analysis Report for the year under review as stipulatedunder Listing Regulations with the Stock Exchanges in India is presented in a separatesection forming part of this Directors' Report. Annexed as Annexure-VI to this report.

11. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of the Act not less than 2/3rd (Two-third) of thetotal number of Directors (other than Independent Directors) shall be liable to retire byrotation. Accordingly pursuant to the Companies Act 2013 read with Article 103 of theArticles of Association of the Company. Mr. Saurabh Agarwal (DIN: 00005970) and Mr. SachinAgarwal (DIN: 01188710) directors retiring by rotation in the ensuing Annual GeneralMeeting being eligible offered themselves for their reappointment. Brief resume natureof expertise details of directorships held in other companies of the Directors proposedto

be re-appointed along with their shareholding in the Company as stipulated underSecretarial Standard 2 and Regulation 36 of the Listing Regulations is appended as anAnnexure to the Notice of the ensuing Annual General Meeting.

The Company in its Annual General Meeting held on 27th September 2016 approved there-appointment and remuneration of Mr. Satish Kumar Agarwal (DIN: 00005981) Chairman &Managing Director and Mr. Sunil Kumar Agarwal (DIN: 00005973) Mr. Saurabh Agarwal (DIN:00005970) and Mr. Sachin Agarwal (DIN: 01188710) as Whole Time Directors of the Companyfor a period of 3 years effect from 1st April 2017 upto 31st March 2020. As their termexpires on 31st March 2020 and there is also requirement of revision of the remunerationpayable to them all of the above four Whole Time Directors has been recommended forRe-appointment for a term of three years effect from 1st April 2020 upto 31st March 2023with their remuneration in the ensuing Annual General Meeting by way of specialresolution.

Mr. Mahendra Kumar Doogar (DIN: 0031904) Mr. Ramesh Chand Surana (DIN: 00089854) Mrs.Nishal Jain (DIN: 06934656) were appointed as Independent Directors pursuant to Section149 of the Companies Act 2013 and the Rules framed thereunder and provisions of erstwhileListing Agreement for their first term of up to 5 consecutive years w.e.f. 1st April 2014up till 31st March 2019. They were re-appointed as Independent Directors on the Board ofthe Company for their second term in the board meeting held on 24th January 2019 subjectto approval of members in the ensuing Annual General Meeting by way of special resolution.

Mr. Radha Krishna Pandey (DIN: 00190017) was appointed as Independent Directorspursuant to Section 149 of the Companies Act 2013 and the Rules framed there under andprovisions of erstwhile Listing Agreement for their first term of up to 5 consecutiveyears w.e.f. 1st April 2014 up till 31st March 2019 he resigned from directorship witheffect from 30th March 2019 due to personal reasons. To comply with the requirements ofcomposition of the board of directors Company was required to fill the casual vacancycreated within next board meeting or 3 months whichever is later. Pursuant to this Mr.Ramesh Chandra Jain (DIN: 00038529) has been appointed as additional and independentdirector with effect from 2nd May 2019 for a term of two years subject to approval of themembers of the Company in the ensuing Annual General meeting.

Besides this there was no change in the composition of the Board of Directors duringthe year.

12. COMMITTEES OF BOARD NUMBER OF MEETINGS OF THE BOARD AND BOARD COMMITTEES

The Board of Directors met Six (6) times during the previous financial year. Inaddition to this one separate meeting of Independent Directors were also held on 29thMarch 2019. As on 31st March 2019 the Board has 8 (Eight) committees namely

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Borrowing Committee

• Corporate Social responsibility Committee

• Allotment Committee

• Share Transfer committee

• Management Committee

All the recommendations made by committees of Board were accepted by the Board. Adetailed update on the Board its composition detailed charter including terms andreference of various Board Committees number of Board and Committee meetings held duringFinancial Year 2018-19 and attendance of the Directors at each meeting is provided in theReport on Corporate Governance which forms part of this Annual Report.

13. ESTABLISHMENT OF THE VIGIL MECHANISM

The Company has formulated an effective Whistle Blower Mechanism and a policy that laysdown the process for raising concerns about unethical behavior actual or suspected fraudor violation of the Company's Code of Conduct or Ethics Policy. This policy is furtherexplained under Corporate Governance section forming part of this Report and the fulltext of the Policy is available on the website of the Company at www.kamdhenulimited.com.

Your Company hereby affirms that no Director/ employee have been denied access to theChairman of the Audit Committee. There no complaints received through the said mechanismwhich pertain to the nature of complaints sought to be addressed through this platform.

14. RISK MANAGEMENT POLICY

The Risk Management is overseen by the Audit Committee of the Company on a continuousbasis. The Committee oversees Company's process and policies for determining risktolerance and review management's measurement and comparison of overall risk tolerance toestablished levels. Major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuous basis.

The Company has an effective risk management procedure which is governed at thehighest level by the Board of Directors covering the process of identifying assessingmitigating reporting and review of critical risks impacting the achievement of Company'sobjectives or threaten its existence. Full text of the Policy is available on the websiteof the Company at www.kamdhenulimited.com.

15. INTERNAL FINANCIAL CONTROLS

Your Company has put in place adeguate internal financial controls with reference tothe financial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation were observed.

The Company has also put in place adequate systems of Internal Control to ensurecompliance with policies and procedures which is commensurate with size scale andcomplexity of its operations. The Company has appointed an external professional firm asInternal Auditor. The Internal Audit of the Company is regularly carried out to review theinternal control systems and processes. The internal Audit Reports along withimplementation and recommendations contained therein are periodically reviewed by AuditCommittee of the Board.

16. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THEREGULATORS/COURTS/TRIBUNALS

During the year under review no significant and material orders have been passed bythe regulators or courts or tribunals impacting the going concern status and Company'soperations in the future.

17. EXTRACT OF ANNUAL RETURN

As required by Section 92(3) read with Rule 12 of the Companies (Management andAdministration) Rules 2014 the Extract of Annual Return in Form MGT-9 is furnished inAnnexure III to this Report. Copy of the Annual Return will be placed on the website ofthe Company at www.kamdhenulimited.com.

18. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from Independent Non Executive Directorsof the Company under Section 149(7) of the Companies Act 2013 that he/she continue tomeet with the criteria of independence as prescribed under Section 149(6) of the CompaniesAct 2013 and the relevant regulations of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. Further there has been no change in the circumstanceswhich may affect their status as Independent Director during the year. The IndependentDirectors have also confirmed that they have complied with the Company's code of conduct.

19. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

In compliance with the requirements of the Listing Regulations the Company has put inplace a familiarization programme for the Independent Directors to familiarize them withtheir roles rights and responsibility as Directors the working of the Company nature ofthe industry in which the Company operates business model etc. A note on thefamiliarization programme adopted by the Company for orientation and training of theDirectors and the Board evaluation process undertaken in compliance with the provisionsof the Companies Act 2013 and the Listing Regulations is provided in the Report onCorporate Governance which forms part of this Annual Report. The same is also availableon the website of the Company at www. kamdhenulimited.com.

20. PERFORMANCE EVALUATION OF THE BOARD OF DIRECTORS

Listing Regulations laying down the key functions of the Board mandates that the Boardshall monitor and review the Board Evaluation Process and also stipulates that theNomination and Remuneration Committee of the Company shall lay down the evaluationcriteria for performance evaluation of Independent Directors. Section 178 of the CompaniesAct 2013 states that a formal evaluation of Board its committees and individualdirectors needs to be carried out either by board by Nomination and RemunerationCommittee or by independent external Agency. Further schedule IV to the Companies Act2013 states that performance evaluation of Independent Directors shall be done by theentire Board of Directors excluding the director being evaluated.

In accordance with the aforesaid provisions the Board has carried out the annualperformance evaluation of its own performance the Directors individually as well as theevaluation of the working of its Committees.

The performance evaluation of the Board its Committees and individual Directors wasconducted and the same was based on questionnaire and feedback from all the Directors onthe Board as a whole Committees and self-evaluation.

Directors who were designated held separate discussions with each of the Directors ofthe Company and obtained their feedback on overall Board effectiveness as well as each ofthe other Directors.

Based on the questionnaire and feedback the performance of every director wasevaluated in the meeting of the Nomination and Remuneration Committee (NRC). The meetingof NRC also reviewed performance of Managing Director on goals (quantitative andqualitative) set at the beginning of the year.

Some of the performance indicators based on which the evaluation takes placeare-attendance in the meetings and quality of preparation/participation ability toprovide leadership work as team player. In addition few criteria for independentdirectors include commitment to protecting/enhancing interests of all shareholderscontribution in implementation of best governance practices. Performance criteria forWhole-time Directors includes contribution to the growth of the Company new ideas/planning and compliances with all policies of the Company.

21. SEPARATE MEETING OF INDEPENDENT DIRECTORS

Pursuant to Schedule IV to the Companies Act 2013 and Listing Regulations oneseparate meeting of Independent Directors ("Annual ID meeting") was held duringthe year i.e. on 29th March 2019 without the attendance of Executive directors andmembers of Management which reviewed the performance of the Board (as a whole) thenon-independent directors and the Chairman. After convening the Annual ID meeting thecollective feedback of each of the Independent Directors was discussed by the Chairman ofthe NRC with the Board's Chairman covering performance of the Board as a whole;performance of the non-independent directors and performance of the Board Chairman.

In addition the Company encourages regular separate meetings of its independentdirectors to update them on all business-related issues and new initiatives.

22. STATUTORY AUDITORS' SECRETARIAL AUDITORS' AND COST AUDITORS' REPORT STATUTORYAUDITORS & THEIR REPORT

M/s B S D & Co Chartered Accountants (ICAI Firm Registration No. 000312S) wereappointed as Statutory Auditors of your Company pursuant to your approval at the AnnualGeneral Meeting held on 29th September 2017 for a term of five consecutive years i.e.upto conclusion of Annual General Meeting of FY 2021-22.

The Board has duly examined the Statutory Auditors' Report to the accounts for theFinancial Year 2018-19 which is self-explanatory. Clarifications wherever necessaryhave been included in the Notes to Accounts section of the Annual Report. The Report doesnot contain any qualification reservation disclaimer or adverse remark.

No fraud has been reported under Section 143(2) of the Act by the Auditors of theCompany.

SECRETARIAL AUDITORS AND THEIR REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhad appointed M/s Chandrasekaran Associates Company Secretaries as the SecretarialAuditors of the Company to undertake its Secretarial Audit for the financial year ended31st March 2019. The Secretarial Auditors have submitted their report confirmingcompliance by the Company of all the provisions of applicable corporate laws. The Reportdoes not contain any qualification reservation disclaimer or adverse remark. TheSecretarial Audit Report is annexed as Annexure-IV to this report.

As per the provisions of Section 204 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed M/s Chandrasekaran Associates Company Secretaries as Secretarial Auditor ofthe Company for the Financial Year 2019-20.

COST AUDITORS AND THEIR REPORT

As per section 134(3) read with rule 8(5) the maintenance of cost records as specifiedby the Central Government under sub-section (1) of section 148 of the Companies Act 2013is required by the Company and accordingly such accounts and records are made andmaintained.

The Company has received the consent and eligibility certificate that the appointmentif made shall be in accordance with the provision of Section 148 of the Companies Act2013. Accordingly the Board on the recommendation of the Audit Committee has approved theappointment of M/s K. G. Goel & Associates Cost Accountants as Cost Auditors forthe financial year ending 31st March 2020. The Cost Auditors will submit their report forthe financial year ending 31st March 2020 on or before the due date.

The Board has duly examined the Cost Auditors' Report for the Financial Year 2018-19which is self-explanatory. Clarifications wherever necessary have been included in thereport. The Report does not contain any qualification reservation disclaimer or adverseremark.

Since the remuneration payable to the Cost Auditors is required to be ratified by theshareholders the Board recommends the same for rectification by shareholders at theensuing Annual General Meeting.

INTERNAL AUDITORS

M/s. D V Aggarwala & Co Chartered Accountants (ICAI Firm Reg No 001263C)performed the duties of internal auditors of the Company for the financial year 2018-19and their report is reviewed by the audit committee on quarterly basis.

23. CORPORATE SOCIAL RESPONSIBILITY (CSR)

For your Company Corporate Social Responsibility (CSR) means the integration ofsocial environmental and economic concerns in its business operations. CSR involvesoperating Company's business in a manner that meets or exceeds the ethical legalcommercial and public expectations that society has of businesses. In alignment withvision of the Company through its CSR initiatives will continue to enhance valuecreation in the society through its services conduct & initiatives so as to promotesustained growth for the society.

Pursuant to the Section 135 of the Act read with the Companies (Corporate SocialResponsibility Policy) Rules 2014 the Company has constituted the Corporate SocialResponsibility (CSR) Committee of the Board of Directors. The composition and terms ofreference of the CSR Committee is provided in the Report on Corporate Governance whichforms part of this Report. The CSR Policy as recommended by the CSR Committee and approvedby the Board of Directors in pursuance of the provisions of Companies Act 2013 isuploaded on website https://www . kamdhenulimited.com. The CSR Committee of the Companyhelps the Company to frame monitor and execute the CSR activities of the Company. TheCommittee defines the parameters and observes them for effective discharge of the socialresponsibility of your Company. The CSR Policy of your Company outlines the Company'sphilosophy & the mechanism for undertaking socially useful programmes for welfare& sustainable development of the community at large as part of its duties as aresponsible corporate citizen.

Further the Annual Report on CSR activities in pursuance of Rule 8 of the Companies(Corporate Social Responsibility Policy) Rules 2014 describing inter-alia theinitiatives taken by the Company in implementation of its CSR Policy is enclosed asAnnexure- II and forms part of this Report.

24. THE COMPANY HAS COMPLIED WITH THE PROVISIONS OF SECRETARIAL STANDARD ISSUED BY THEINSTITUTE OF COMPANY SECRETARIES OF INDIA

The Companies Act 2013 has made it compulsory for every company to comply the twosecretarial standards (SS) issued by the Institute of Company Secretaries of India (ICSI)under the provisions of Section 118(10) of the Companies Act 2013 with respect to Boardmeetings (SS-1) and General meetings (SS-2). The Company has complied with provisions ofSecretarial Standards during the year under review.

25. INFORMATION REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO

The particulars as prescribed in terms of Section 134 of the Act read with Rule 8(3) ofthe Companies (Accounts) Rules 2014 pertaining to the conservation of energy technology absorption and foreign exchange earnings and outgo to the extent possible inopinion of your directors and forming part of this Report is given in Annexure-I to thisReport.

26. GREEN INITIATIVE

The Company has implemented the "Green Initiative" to enable electronicdelivery of notice/documents/ annual reports to shareholders. Electronic copies of theAnnual Report 2018-19 and Notice of the 25th Annual General Meeting will be sent to allmembers as on cut of date whose e-mail addresses are registered with theCompany/Depository Participant(s). For members who have not registered their e-mailaddresses physical copies of the Annual Report 2018-19 and the Notice of the 25th AnnualGeneral Meeting will be sent in permitted mode. Members requiring a physical copy may senda request to the Company Secretary.

The Company is providing e-voting facility to all members to enable them to cast theirvotes electronically on all resolutions set forth in the Notice. This is pursuant tosection 108 of the Companies Act 2013 read with relevant rules thereon. The instructionsfor e-voting are provided in the Notice of the AGM.

27. HUMAN RESOURCES MANAGEMENT

Human resources management of the Company goes beyond the set boundaries ofcompensation performance reviews and development. Your Company considers people as itsbiggest assets and 'Believing in People' is at the heart of its human resource strategy.Your Company has put concerted efforts in talent management and succession planningpractices strong performance management and learning and training initiatives to ensurethat your Company consistently develops inspiring strong and credible leadership. Duringthe year the focus of your Company was to ensure that young talent is nurtured andmentored consistently that rewards and recognition are commensurate with performance andthat employees have the opportunity to develop and grow. Your Company has established anorganization structure that is agile and focused on delivering business results. Withregular communication and sustained efforts it is ensuring that employees are aligned oncommon objectives and have the right information on business evolution. Your Companystrongly believes in fostering a culture of trust and mutual respect in all its employeesand seeks to ensure that company's values and principles are understood by all and are thereference point in all people matters.

The Company has continuously adopted structures that help to attract best externaltalent and promote internal talent to higher roles and responsibilities. The Companyproviding an open work environment fostering continuous improvement and development thathelped several employees realize their career aspirations during the year.

The Company maintained healthy cordial and harmonious industrial relations at alllevels. The enthusiasm and unstinting efforts of employees have enabled the Company toremain at the leadership position in the industry. It has taken various steps to improveproductivity across organization.

The Company's Health and Safety Policy commits to provide a healthy and safe workenvironment to all employees. The Company's progressive workforce policies and benefitsvarious employee engagement and welfare have addressed stress management promoted worklife balance.

28. KAMDHENU EMPLOYEE STOCK OPTION SCHEME 2017

Our ESOP schemes help us share wealth with our employees and are part of aretention-oriented compensation program. They help us meet the dual objective ofmotivating key employees and retention while aligning their long-term career goals withthat of the Company.

During the financial year 2017-18 the Company has implemented the Kamdhenu EmployeeStock Option Scheme 2017 and granted 615000 Options to eligible employees as per thescheme against which the employees shall be allotted equal number of equity shares in next4 years. In furtherance the Company has allotted 143250 equity shares at first trench oncompletion of 1 year after granting options on exercising of options vested by theemployees and allotted shares in the board meeting held on 2nd May 2019 at apredetermined exercising price of Rs.50/- per option. At present the listing of thoseshares are pending with the Stock exchanges i.e. on BSE Ltd. (BSE) &National StockExchange of India Ltd. (NSE). Details of the implemented Kamdhenu Employee Stock OptionScheme 2017 are as follows.

Name of Scheme: Kamdhenu Employee Stock Option Scheme 2017

No of Options granted Date of grant of options Date of Vesting of options No of Options vested (25% of the Completion of 1 year after grant date) No of Options exercised Date of allotment of shares on exercise of Options Amount realized/ Consideration received in Rs. (no of options*50)
615000 29th January 2018 29th January 2019 153750 143250 2nd May 2019 7162500

29. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

At Kamdhenu all employees are of equal value. There is no discrimination betweenindividuals at any point on the basis of race colour gender religion politicalopinion national extraction social origin sexual orientation or age. At Kamdhenu everyindividual is expected to treat his/her colleagues with respect and dignity. TheWhistle-Blower & Protection Policy provides a platform to all employees for reportingunethical business practices at workplace without the fear of reprisal and help ineliminating any kind of misconduct in the system. The Policy also includes misconduct withrespect to discrimination or sexual harassment. The Company also has in place 'Preventionof Sexual Harassment Policy'. This Anti-Sexual Harassment Policy of the Company is in linewith the requirements of The Sexual Harassment of Women at the Workplace (PreventionProhibition & Redressal) Act 2013. All employees are covered under this policy.

The Company has complied with the provision relating to the constitution of InternalComplaints Committee under the Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013.

During the FY 2018-19 the Company received one complaint on sexual harassment underThe Sexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal)Act 2013 and is under inquiry and investigation i.e. pending for resolution.

30. CHANGE IN NATURE OF BUSINESS

During the year there is no change in nature of business of the Company under review.

31. NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANY'S SUBSIDIARIESJOINT VENTURES OR ASSOCIATE COMPANIES DURING THEYEAR

During the year under review there is no such Company which has become or ceased to beCompany's subsidiary joint venture or associate Company.

32. DOCUMENTS PLACED ON THE WEBSITE (www. kamdhenulimited.com)

The following documents have been placed on the website at www.kamdhenulimited.com incompliance with the Companies Act 2013 Listing Regulations and other statutoryrequirements:

• DETAILS OF UNPAID DIVIDEND AS PER I EPF (UPLOADING OF INFORMATION REGARDINGUNPAID AND UNCLAIMED AMOUNTS LYING WITH COMPANIES) RULES 2012

• FINANCIAL STATEMENTS OF THE COMPANY ALONG WITH RELEVANT DOCUMENTS AS PER SECTION136(1) OF THE COMPANIES ACT 2013

• CODE OF CONDUCT AND WORK PLACE ETHICS

• CODE OF CONDUCT FOR BOARD MEMBERS & SENIOR MANAGEMENT PERSONNEL

• CODE OF PRACTICES & PROCEDURES FOR FAIR DISCLOSURE OF UNPUBLISHED PRICESENSITIVE INFORMATION

• CODE OF CONDUCT TO REGULATE MONITOR AND REPORT TRADING BY INSIDERS

• RISK MANAGEMENT POLICY & PROCEDURES

• NOMINATION AND REMUNERATION POLICY

• POLICY ON RELATED PARTY TRANSACTIONS

• WHISTLE BLOWER POLICY & VIGIL MECHANISM

• POLICY ON SEXUAL HARASSMENT OF EMPLOYEES

• CORPORATE SOCIAL RESPONSIBILITY POLICY

• BOARD DIVERSITY POLICY

• FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

• ARCHIVAL POLICY

• POLICY ON PRESERVATION OF DOCUMENTS

• POLICY FOR DETERMINATION OF MATERIALITY OF EVENTS AND INFORMATION

• THE TERMS AND CONDITIONS OF APPOINTMENT OF THE INDEPENDENT DIRECTORS OF THECOMPANY

• APPOINTMENT LETTER OF INDEPENDENT DIRECTORS

33. COMPANY'S POLICY OF DIRECTORS' APPOINTMENT AND REMUNERATION

The Company's policy on Directors' appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a director and othermatters provided under section 178(3) of the Act are available on the website of theCompany under the heading investor zone at www.kamdhenulimited.com. Further informationabout elements of remuneration package of individual directors is provided in the extractof Annual Return in Form MGT-9 enclosed as Annexure-III to this Report.

We affirm that remuneration paid to the Directors is as per the terms laid out in theNomination and Remuneration Policy of the Company.

The Nomination and Remuneration Policy as approved and adopted by Nomination andRemuneration Committee and the Board of Directors of the Company enumerating the criterialaid down for appointment evaluation and remuneration of Directors and key managerialpersonnel determining qualifications positive attributes and independence of Directorsand/or key managerial personnel is available on the website of Company athttps://www.kamdhenulimited. com/Financial-Results/Nomination-Remuneration- Policy.pdf.

34. CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

In compliance with Regulation 26(3) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has formulated Code of Conduct for the Boardmembers and senior management personnel of the Company so that the Company's business isconducted in an efficient and transparent manner without having any conflict of personalinterests with the interests of the Company. All the members of the Board and seniormanagement personnel have affirmed compliance with the Code of Conduct. Code of Conductfor the Board members and senior management personnel is available at the website ofCompany www.kamdhenulimited.com.

Declaration by the Chairman & Managing Director

It is hereby declared that the Company has obtained from each individual member of theBoard of Directors and the Senior Management confirming that none of them has violated theconditions of the said Code of Conduct.

35. RELATIONSHIP BETWEEN DIRECTORS INTER-SE

Directors are related to each other within the meaning of the term "relative"as per Section 2(77) of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) regulations 2015. Details given in Corporate Governance Reportforming part of this report.

36. PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON-EXECUTIVE DIRECTORS

During the year the Non-Executive Directors of the Company had no pecuniaryrelationship or transactions with the Company.

37. PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Companies Act 2013 and the Rule 5(1)of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respectof employees of the Company.

a. Ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year ended 31st March 2019

Sr. No. Name of Director Designation (Rs./Lakhs) Remuneration of Director/KMP for FY 2018-19 Ratio of Remuneration of each Director/to median remuneration of employees
1. Mr. Satish Kumar Agarwal Chairman & Managing Director 150.79 42.50
2. Mr. Sunil Kumar Agarwal Whole Time Director 147.79 41.66
3. Mr. Saurabh Agarwal Whole Time Director 144.79 40.81
4. Mr. Sachin Agarwal Whole Time Director 144.79 40.81
5. Mr. Mahendra Kumar Doogar Independent Director 3.70 1.04
6. Mr. Radha Krishna Pandey Independent Director 3.40 0.96
7. Mr. Ramesh Chand Surana Independent Director 2.60 0.73
8. Mrs. Nishal Jain Independent Director 2.10 0.59

*Median Salary (Annual) of employees for the Financial Year 2018-19 is Rs.354798/-.

b. The percentage increase in remuneration of each Director Chief Executive OfficerChief Financial Officer Company Secretary or Manager if any in the financial year ended31st March 2019.

Sr. No. Name of Director/ KMP Designation % Increase in remuneration
1. Mr. Satish Kumar Agarwal Chairman & Managing Director 55.79
2. Mr. Sunil Kumar Agarwal Whole Time Director 57.57
3. Mr. Saurabhagarwal Whole Time Director 59.48
4. Mr. Sachin Agarwal Whole Time Director 59.48
5. Mr. Mahendra Kumar Doogar Independent Director 8.82
6. Mr. Radha Krishna Pandey Independent Director 7.94
7. Mr. Ramesh Chand Surana Independent Director 36.84
8. Mrs. Nishal Jain Independent Director 16.67
9. Mr. Harish Kumar Agarwal Chief Financial Officer 16.88
10. Mr. Jogeswar Mohanty Company Secretary 37.28

c. The percentage increase in the median remuneration of employees in the financialyear ended 31 st March 2019 is 9.33.%.

d. The number of permanent employees on the rolls of Company as on 31st March 2019 areSeven Hundred Ten (710).

e. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:

The average increase in salaries of employees other than managerial personnel in F.Y2018-19 was 13.62%. Percentage increase in the managerial remuneration for the year was53.85 %.

f. Affirmation that the remuneration is as per the remuneration policy of the Company.

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy forDirectors Key Managerial Personnel and other Employees.

The Company's remuneration policy is driven by the success and performance of theindividual employees and the Company. Through its compensation package the Companyendeavors to attract retain develop and motivate a high performance staff. The Companyfollows a compensation mix of fixed pay benefits and performance based variable pay.Individual performance pay is determined by business performance and the performance ofthe individuals measured through the annual appraisal process. The Company affirmsremuneration is as per the remuneration policy of the Company.

O z C/5 Name Age(Years) Designation Annual Remuneration (Rs. Lakhs) C of O o 3 a Experience (Years) Date of commencement of Employment Last Employment held/ Designation/ Period Nature of employment whether contractual or otherwise Percentage of equity shares held in the Company Whetherthe employee is relative of any director or manager of the Company and if yes name of such director or manager
1. Mr. Satish Kumar Agarwal 69 Chairman & Managing Director 150.79 B.E. (Mechanical) 47 Years 12.09.1994 Vikas Refractories Pvt. Ltd. Managing Director 12 Years As per appointment letter/Board resolution 4.86 1. Father of Mr. Saurabh Agarwal & Mr. Sachin Agarwal 2. Brother of Mr. Sunil Kumar Agarwal
2. Mr. Sunil Kumar Agarwal 61 Whole Time Director 147.79 B.E. (Chemical) 33 Years 01.01.2003 Family Business As per appointment letter/Board resolution 5.85 Brother of Mr. Satish Kumar Agarwal
3. Mr. Saurabh Agarwal 44 Whole Time Director 144.79 B.E. (Mechanical) 19 Years 01.08.1998 NA As per appointment letter/Board resolution 3.13 1. Son of Mr. Satish Kumar Agarwal 2. Brother of Mr. Sachin Agarwal
4. Mr. Sachin Agarwal 40 Whole Time Director 144.79 B. Tech. (Industrial Engineering & Management) MBA 15 Years 01.04.2004 NA As per appointment letter/Board resolution 3.50 1. Son of Mr. Satish Kumar Agarwal 2. Brother of Mr. Saurabh Agarwal
5. Mr. Raj Kumar Srivastava 49 NATIONAL HEAD - MKT 65.55 B. Com -1989 25 Years 01.09.2007 16 Years experience in Acro Paints as Factory Manager. Permanent NIL NO
6. Mr. Harish Kumar Agarwal 51 CFO &Head- Legal 32.03 B.Com C.A- 1993 27 Years 01.07.2006 Worked with Penam Leboratories Limited as GM- Finance for 8 Years. Permanent NIL NO
7. Mr. Himanshu Maniar 48 GM-Sales 28.79 B. Com 24 years 14.02.2019 Worked with Zydex Industry as GM- Marketings. Permanent NIL NO
8. Mrs. Vipil Agarwal 47 GM - Business Development 27.53 M.A. B.Ed. 15 Years 01.08.2006 Free lancer Permanent NIL NO
9. Mr. Ramaswamy Janak 63 GM-Sales & Marketing 24.99 MBA LLM MIMA 35 years 18.04.2018 Worked with Killick Guard Speciality Product Ltd as GM-Sales & Marketing Permanent NIL NO
10. Mrs. Nisha Adlakha 34 Global Business Head 24.01 M.B.A (Finance & Marketing) 11 Years 16.03.2018 Country Manager (Sales & Operation) Graphenstone Spain Permanent NIL NO

 

Employed throughout the year and in receipt of remuneration not less than Rs.102 Lakhs NIL
Employed for part of the year and in receipt of remuneration not less than Rs.8.50 Lakhs per month. NIL
Employees in the Company who employed throughout the financial year or part thereof was in receipt of remuneration in that year which in the aggregate or as the case may be at a rate which in the aggregate is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children not less than two percent of the equity shares of the Company. NIL

38. DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(3)(c) and 134(5) of the Companies Act2013 your Directors to the best of their knowledge and belief confirm that:

a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to 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 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;

e) The directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and 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.

39. APPRECIATION

Your Company's organisational culture upholds professionalism integrity and continuousimprovement across all functions as well as efficient utilisation of the Company'sresources for sustainable and profitable growth.

Your Directors acknowledge with gratitude and wishes to place on record itsappreciation for the dedication and commitment of your Company's employees at all levelswhich has continued to be our major strength.

The enthusiasm and unstinting efforts of the employees have enabled the Company toremain as industry leaders.

The Board places on record its appreciation for the support and co-operation yourCompany has been receiving from its suppliers distributors stockists dealers businesspartners franchisee units and others associated with the Company as its trading partners.Your Company looks upon them as partners in its progress and has shared with them therewards of growth. It will be your Company's endeavour to build and nurture strong linkswith the trade based on mutuality of benefits respect for and co- operation with eachother consistent with consumer interests.

The Directors also take this opportunity to thank the shareholders investorscustomers visitors to our websites bankers Government and Regulatory Authorities StockExchanges and other stakeholders for their confidence in the Company and its managementand look forward for their continuous support.

BY ORDER OF THE BOARD OF DIRECTORS
(Satish Kumar Agarwal) (Sunil Kumar Agarwal)
Date : 2nd May 2019 Chairman & Managing Director Whole Time Director
Place : Gurgaon DIN: 00005981 DIN:00005973

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