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Kanani Industries Ltd.

BSE: 506184 Sector: Consumer
NSE: KANANIIND ISIN Code: INE879E01037
BSE 00:00 | 27 Jan 8.36 -0.29
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NSE 00:00 | 27 Jan 8.45 -0.20
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OPEN 8.48
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VOLUME 40592
52-Week high 42.70
52-Week low 7.62
P/E 83.60
Mkt Cap.(Rs cr) 83
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 8.48
CLOSE 8.65
VOLUME 40592
52-Week high 42.70
52-Week low 7.62
P/E 83.60
Mkt Cap.(Rs cr) 83
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kanani Industries Ltd. (KANANIIND) - Director Report

Company director report

To

The Members

KANANI INDUSTRIES LIMITED

Your Directors have pleasure in presenting their 39th AnnualReport on the Standalone and Consolidated Audited Statement of Accounts of KananiIndustries Limited ["the Company"]for the Financial Year ended March 312022.

FINANCIAL RESULTS

The summarized financial performance of the Company for the FY 2021-22and FY 2020-21 is given below:

(Rs in Lakhs)

Particulars Standalone Consolidated
2021-2022 2020-2021 2021-2022 2020-2021
Revenue from operations 8456.25 7716.51 29072.52 31157.60
Other Income 116.59 91.10 116.59 91.11
Total Revenue 8572.84 7807.63 29189.12 31248.71
Total Expenses 8460.92 7755.11 28987.79 31194.22
Profit/(Loss) before exceptional and extraordinary items and tax 111.92 52.52 201.33 54.49
Exceptional Items - - - -
Extraordinary Items - - - -
Net Profit Before Tax 111.92 52.52 201.33 54.49
Provision for Tax
- Current Tax 18.68 8.19 20.79 10.57
- Deferred Tax (Liability)/Assets - - - -
- Excess/(short) provision for earlier years - - - -
Net Profit After Tax 93.24 44.33 180.53 43.92
Profit/(Loss) from Discontinued operations - - - -
Tax Expense of Discontinued operations - - - -
Profit/(Loss) from Discontinued operations (after tax) - - - -
Profit/(Loss) for the period 93.24 44.33 180.53 43.92
Other Comprehensive Income
- Items that will not be reclassified to profit or loss - - - -
- Income tax relating to items that will not be reclassified to profit or loss - - - -
- Items that will be reclassified to profit or loss - - - -
- Income tax relating to items that will be reclassified to profit or loss - - - -
Total Comprehensive income for the period (Comprising Profit (Loss) and Other Comprehensive Income for the period) 93.24 44.33 180.53 43.92
Earnings per equity share (for continuing operation):
- Basic (In Rs) 0.09 0.04 0.18 0.04
- Diluted (In Rs) 0.09 0.04 0.18 0.04

Review of Operations Standalone:

During the year under review the Standalone total Income was Rs.8572.84 lacs as against Rs. 7807.63 lacs for the corresponding previous year. TotalComprehensive income for the period was Rs. 93.24 lacs as against Rs. 44.33 lacs in thecorresponding previous year

Consolidated:

During the year under review the consolidated total Income was Rs.29189.12 lacs as against Rs. 31248.71 lacs for the corresponding previous year.

Total Comprehensive consolidated income for the period was Rs. 180.53lacs as against Rs. 43.92 lacs in the corresponding previous year State of Affairs andFuture Outlook

The Jewelry business will continue its growth path through variousinitiatives including launching of new collections & Designs increasing share ofstudded jewelry and achieving design leadership. In coming year the Company would drivefor strong and profitable growth in all its consumer businesses.

Dividend

In order to conserve the resources for the further growth of theCompany your Directors think fit not to recommend any dividend for the year under review.

Transfer to Reserves

The Board of Directors has decided to retain the entire amount ofprofits in the profit and loss account.

Management Discussion and Analysis

The Management Discussion and Analysis as required in terms of theListing Regulations is annexed to the report as Annexure I and is incorporated herein byreference and forms an integral part of this report.

Share Capital

The Paid-up Equity Share Capital of the Company as on 31stMarch 2022 is Rs. 98934000/- comprising of 98934000 shares of Re. 1/- each. During theyear under review the Company has not issued any securities.

Directors and Key Managerial Personnel

? Inductions / Appointment or Re-appointment of Director:

Pursuant to the provisions of Section 152 of the Act Mr. Darsh Kanani(DIN: 07060543) retires by rotation at the ensuing Annual General Meeting and beingeligible has offered himself for re-appointment. The Board recommends his re-appointment.

Based on the recommendation of the Nomination and RemunerationCommittee and approval of the same by the Board at its meeting held on August 06 2022Mr. Harshil Kanani [DIN: 01568262] Managing Director was re-appointed as a ManagingDirector and Mr. Premjibhai Kanani [DIN: 01567443] was re-appointed as a Whole-timedirector for a further period of 5 years w.e.f. August 01 2022 Resolution(s) in thisbehalf is set out at Item No 3 & Item No.4 of the Notice of Annual General Meetingfor Members' approval.

All the directors of the Company have confirmed that they satisfy thefit and proper criteria as prescribed under the applicable regulations and that they arenot disqualified from being appointed as directors in terms of Section 164(2) of theCompanies Act 2013.

Further Pursuant to Section 203 of the Companies Act 2013 the KeyManagerial Personnel of the Company are:

Sr. No Name of KMP Designation
1. Mr. Premjibhai Kanani Whole-time Director & Chairman
2. Mr. Harshil Kanani Managing Director
3. Mr. Darshak Pandya Chief Financial Officer
4. Mr. Mehul Kundariya Company Secretary and Compliance Officer

During the year there has been no change in the Key ManagerialPersonnel.

Declaration by Independent Directors

Your Company had received declarations from all the IndependentDirectors of the Company confirming that they meet with the criteria of independence asprescribed both under sub-section (6) of Section 149 of the Companies Act 2013 along withRules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. There hasbeen no change in the circumstances affecting their status as independent directors of theCompany.

Independent Directors are familiarized with their roles rights andresponsibilities as well as with the nature of industry and business model throughinduction program at the time of their appointment as Directors and through presentationson economy & industry overview key regulatory developments strategy and performancewhich are made to the Directors from time to time.

Board Meetings

Dates for Board Meetings are well decided in advance and communicatedto the Board and the intervening gap between the meetings was within the period prescribedunder the Companies Act 2013 and the Listing Agreement. The information as required underRegulation 17(7) read with Schedule II Part A of the LODR is made available to the Board.The agenda and explanatory notes are sent to the Board in advance. The Board periodicallyreviews compliance reports of all laws applicable to the Company. The Board meets at leastonce a quarter to review the quarterly financial results and other items on the agenda andalso on the occasion of the Annual General Meeting (‘AGM') of the Shareholders.Additional meetings are held when necessary.

Further Committees of the Board usually meet on the same day of formalBoard Meeting or whenever the need arises for transacting business. The recommendationsof the Committees are placed before the Board for necessary approval and noting.

During the year 05 (Five) Board Meetings were held during the yearended 31st March 2022 the dates which are 30th June 2021 14thAugust 2021 30th October 2021 10th January 2022 and 12thFebruary 2022.

Attendance details of Directors for the year ended March 312022 aregiven below:

Name of the Directors Category No. of Board Meetings attend
Mr. Premjibhai Kanani Chairman Whole-time Director 05
Mr. Harshil Kanani Managing Director 05
Mrs. Ami Dhaval Jariwala Independent Director 05
Mr. Tejas Murlidhar Choksi Independent Director 02
Mr. Rahul Javeri Independent Director 03
Mr. Darsh Kanani Non-Executive Non-Independent Director 03

Discussions with Independent Directors

The Board's policy is to regularly have separate meetings withIndependent Directors to update them on all business related issues new initiatives andchanges in the industry specific market scenario. At such meetings the ExecutiveDirectors and other Members of the Management make presentations on relevant issues.

The policy for Familiarisation Programme for Independent Directors isavailable on our website www.kananiindustries.com.

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and the ListingAgreement/ SEBI (LODR) Regulations 2015 the Board has carried out an annual performanceevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Committees. The Directors expressed satisfaction with the evaluationprocess.

Composition of Audit Committee

Your Company has formed an Audit Committee as per the Companies Act2013 and Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015. All members of the Audit Committee possess strongknowledge of accounting and financial management.

The primary objective of the Audit Committee is to monitor and providean effective supervision of the Management's financial reporting process to ensureaccurate and timely disclosures with the highest levels of transparency integrity andquality of financial reporting. The Committee oversees the work carried out in thefinancial reporting process by the Management the statutory auditor and notes theprocesses and safeguards employed by each of them.

The Committee met 5 (Five) times during the year the details of whichare given in the Corporate Governance Report along with composition of the Committee andtheir attendance.

Composition of Nomination & Remuneration Committee

Your Company has formed a Nomination & Remuneration Committee tolay down norms for determination of remuneration of the executive as well as non-executivedirectors and executives at all levels of the Company. The Nomination & Remunerationcommittee has been assigned to approve and settle the remuneration package with optimumblending of monetary and non-monetary outlay.

The Committee met 3 (Three) times during the year the details of whichare given in the Corporate Governance Report along with composition of the Committee andtheir attendance.

Nomination and Remuneration Policy

The Board of Directors has framed a policy which lays down a frameworkin relation to remuneration of Directors. This policy also lays down criteria forselection and appointment of Board Members. The Board of Directors is authorized to decideRemuneration to Executive Directors. The Remuneration structure comprises of Salary andPerquisites. Salary is paid to Executive Directors within the Salary grade approved by theMembers. The Nomination & Remuneration committee has been assigned to approve andsettle the remuneration package with optimum blending of monetary and non-monetary outlay.

In terms of requirements prescribed under Section 178(3) of theCompanies Act 2013 the Nomination and Remuneration Policy inter-alia providing the termsfor appointment and payment of remuneration to Directors and Key Managerial Personnel.

During the year there have been no changes to the Policy. The same isannexed to this report as Annexure II and is available on our websitewww.kananiindustries.com.

Details of remuneration paid to Directors and Key Managerial Personnelare given in the Corporate Governance Report along with shareholding in a Company.

Composition of Stakeholders Relationship Committee

Your Board has constituted a Stakeholders Relationship Committee tospecifically look into the mechanism of redressal of grievances of shareholders etc. TheCommittee reviews Shareholder's / Investor's complaints like non-receipt of Annual Reportphysical transfer/ transmission/transposition split/ consolidation of share certificatesissue of duplicate share certificates etc. This Committee is also empowered to considerand resolve the grievance of other stakeholders of the Company including security holders.

The Committee met 05 (Five) times during the year the details of whichare given in the Corporate Governance Report along with composition of the Committee andtheir attendance.

Directors? Responsibility Statement

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act 2013the Board of Directors of the Company hereby confirm that:

(a) In the preparation of the annual accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures;

(b) the directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;

(c) the directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of this Actfor safeguarding the assets of the company and for preventing and detecting fraud andother irregularities;

(d) the directors have prepared the annual accounts on a going concernbasis; and

(e) the directors have laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively.

(f) the directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.

Particulars of Employees and Related Disclosures

The information required pursuant to Section 197 read with Rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules 2016in respect of employees of the Company is enclosed as Annexure III and forms part of thisReport.

Further as per the provisions specified in Chapter XIII of Companies(Appointment & Remuneration of Managerial Personnel) Amendment Rules 2016 none of theemployees of the Company are in receipt of remuneration exceeding Rs. 10200000/- perannum if employed for whole of the year or Rs. 850000/- per month if employed for partof the year.

Further the names of top ten employees in terms of remuneration drawnare disclosed in Annexure IV and forms part of this Report.

Extract of Annual Return:

Pursuant to Notification dated 28th August 2020 issued by the Ministryof Corporate Affairs as published in the Gazette of India on 28th August 2020 thedetails forming part of the extract of Annual Return in Form MGT-9 is not required to beannexed herewith to this report. However the Annual Return will be made available at thewebsite of the Company at : www.kananiindustries.com.

Details of Subsidiary/Joint Ventures/Associate Companies

The Statement AOC-1 pursuant to the provisions of Section 129 (3) ofthe Companies Act 2013 read with Rule 5 of the Companies (Accounts) Rules 2014 regardingSubsidiary Company is enclosed as Annexure V and forms part of this Report.

Statutory Auditors? and Auditors? Report

The Members of the Company at the Annual General Meeting (‘AGM')held on 30th September 2021 approved the appointment M/s SMS & Co.Chartered Accountants (Firm Registration No.116388W) were appointed as Statutory Auditorsof the Company to hold office till the conclusion of the 43rd Annual General Meeting.

Secretarial Audit

In terms of Section 204 of the Act and Rules made there under M/s.Deep Shukla & Associates Practicing Company Secretaries have been appointedSecretarial Auditors of the Company. The Secretarial Audit Report is enclosed as AnnexureVI to this report.

Annual Secretarial Compliance Report

M/s. Deep Shukla & Associates Practicing Company Secretaries havebeen appointed to give Annual Secretarial Compliance Certificate. The Annual ComplianceCertificate is enclosed as Annexure VII to this report.

Internal Audit & Controls

The Company has in place adequate internal financial controls withreference to the financial statement. The Audit Committee of the Board periodicallyreviews the internal control systems with the management Internal Auditors and StatutoryAuditors. Significant internal audit findings are discussed and follow-ups are takenthereon.

Further M/s. Mehta Kothari & Co Chartered AccountantsM.No.0120266 was appointed as Internal Auditors of the Company pursuant to section 138 ofthe Companies Act 2013.

Employees? Stock Option Plan

The Company has not provided stock options to any employee.

Vigil Mechanism

In pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013 a Vigil Mechanism for directors and employees to report genuineconcerns has been established. The Vigil Mechanism Policy has been uploaded on the websiteof the Company at www.kananiindustries.com. The employees of the Company are made aware ofthe said policy at the time of joining the Company.

Risk Management Policy

The Company has laid down the procedure to inform the Board about therisk assessment and minimization procedures. These procedures are reviewed by the Boardannually to ensure that there is timely identification and assessment of risks measuresto mitigate them and mechanisms for their proper and timely monitoring and reporting.

The Company does not fall under the ambit of top 1000 listed entitiesdetermined on the basis of market capitalisation as at the end of the immediatelypreceding financial year. Hence compliance under Regulation 21 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is not applicable.

Corporate Governance Report

We ensure that we evolve and follow the corporate governanceguidelines and best practices sincerely not only to boost long-term shareholder valuebut also to respect minority rights. We consider it as our inherent responsibility todisclose timely and accurate information regarding our operations and performance as wellas the leadership and governance of the Company.

Pursuant to the Listing Regulations the Corporate Governance Reportalong with the Certificate from a Practicing Chartered Accountants regarding complianceof conditions of Corporate Governance is annexed as Annexure VIII and forms part of thisReport.

Deposits

The Company has neither accepted nor renewed any fixed deposits duringthe year under review under Section 76 of the Companies Act 2013. There are no unclaimeddeposits unclaimed / unpaid interest refunds due to the deposit holders or to bedeposited to the Investor Education and Protection Fund as on March 312022.

However during the financial year the Company has borrowed money(ies)from Directors of the Company in pursuant to Rule 2(c)(viii) of the Companies (Acceptanceof Deposits) Rules 2014 amended from time to time and said amount is not being givenout of funds acquired by him/them by borrowing or accepting loans or deposits from others.

Loans & Guarantees

During the year under review the Company has not provided any loanguarantee security or made any investment covered under the provisions of Section 186 ofthe Companies Act 2013 to any person or other body corporate.

Insurance

The properties/assets of the Company are adequately insured.

Related Party Transactions

Related party transactions if any that were entered into during theperiod ended March 31 2022 were on an arm's length basis and were in the ordinary courseof business. There are no materially significant related party transactions made by theCompany with Promoters Directors Key Managerial Personnel or other designated personswhich may have a potential conflict with the interest of the Company at large.

None of the Directors has any pecuniary relationships or transactionsvis-a-vis the Company.

The details of the related party transactions as per AccountingStandard 18 are set out in Note No. 22(9) to the Significant Accounting policies part ofthis report.

Conservation of Energy Research and Development Technology Absorptionand Foreign Exchange

The details of conservation of energy technology absorption foreignexchange earnings and outgo are as follows:

(a) Conservation of Energy:

Even though its operations are not energy-intensive significantmeasures are taken to reduce energy consumption by using energy-efficient equipment. TheCompany regularly reviews power consumption patterns across all locations and implementrequisite improvements/changes in the process in order to optimize energy/ powerconsumption and thereby achieve cost savings. Energy costs comprise a very small part ofthe Company's total cost of operations. However as a part of the Company's conservationof energy programme the management has appealed to all the employees / workers toconserve energy.

(b) Absorption of Technology:

I. The efforts made towards technology absorption:

The Company values innovation and applies it to every facet of itsbusiness. This drives development of distinctive new products ever improving qualitystandards and more efficient processes.

The Company has augmented its revenues and per unit price realizationby deploying innovative marketing strategies and offering exciting new products. The depthof designing capabilities was the core to our success over the years.

The Company uses the service of in-house designers as well as those offree-lancers in developing product designs as per the emerging market trends. The Companyuses innovation in design as well as in technology to develop new products.

II. Benefits derived as a result of the above efforts:

As a result of the above the following benefits have been achieved:

a) Better efficiency in operations

b) Reduced dependence on external sources for technology for developingnew products and upgrading existing products

c) Expansion of product range and cost reduction

d) Greater precision

e) Retention of existing customers and expansion of customer base

f) Lower inventory stocks resulting in low carrying costs.

III. The Company has not imported any technology during the year underreview;

IV. The Company has not expended any expenditure towards Research andDevelopment during the year under review.

(c) Foreign Exchange Earnings and Outgo:

(Amount in Rs)

Particulars FY 2021-2022 FY 2020-2021
C.I.F. Value of Imports 884865944 640032179
F.O.B. Value of Exports 845625214 771651630

Transfer of Amounts to Investor Education and Protection Fund

Pursuant to the provisions of the Companies Act 2013 read with TheInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 as amended (‘Rules') the dividends unclaimed for a consecutive periodof seven years from the date of transfer to the Unpaid Dividend Account of the Company areliable to be transferred to IEPF. Further the shares (excluding the disputed cases havingspecific orders of the Court Tribunal or any Statutory Authority restraining suchtransfer) pertaining to which dividend remains unclaimed for a period of continuous sevenyears from the date of transfer of the dividend to the unpaid dividend account are alsomandatorily required to be transferred to the IEPF established by the Central Government.Accordingly the Company has transferred unclaimed dividend eligible to IEPF authoritywithin statutory timelines.

Any person whose unclaimed dividend and shares pertaining theretomatured deposits matured debentures application money due for refund or interestthereon sale proceeds of fractional shares redemption proceeds of preference sharesamongst others has been transferred to the IEPF Fund can claim their due amount from theIEPF Authority by making an electronic application in e-form IEPF-5. Upon submitting aduly completed form Shareholders are required to take a print of the same and sendphysical copy duly signed along with requisite documents as specified in the form to theattention of the Nodal Officer at the Registered Office of the Company. The e-form can bedownloaded from the website of Ministry of Corporate Affairs www.iepf.gov.in.

Shareholders are requested to get in touch with the RTA for encashingthe unclaimed dividend/interest/principal amount if any standing to the credit of theiraccount.

Corporate Social Responsibility

The Company is committed to discharging its social responsibility as agood corporate citizen.

During the year under review the Company has not expended any amounttowards CSR activities as the same is not applicable to the Company pursuant to section135 of the Companies Act 2013.

Cost Audit

As per the Cost Audit Orders and in terms of the provisions of Section148 and all other applicable provisions of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 Cost Audit is not applicable to our Company.

Obligation of Company Under The Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013

In order to prevent sexual harassment of women at work place a new actThe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 has been notified on 9th December 2013. Under the said Act every companyis required to set up an Internal Complaints Committee to look into complaints relating tosexual harassment at work place of any women employee.

The Company has adopted a policy for prevention of Sexual Harassment ofWomen at workplace and has set up Committee for implementation of said policy. During theyear Company has not received any complaint of harassment.

Secretarial Standards

The Company has in place proper systems to ensure compliance with theprovisions of the applicable secretarial standards issued by The Institute of CompanySecretaries of India and such systems are adequate and operating effectively.

Significant and Material Orders passed by the Regulators or Courts orTribunals

There are no significant and material orders passed by the Regulators /Courts / Tribunals which would impact the going concern status of the Company and itsfuture operations.

Material Changes and Commitments Affecting the Financial Position ofthe Company:

There have been no material changes and commitments affecting thefinancial position of the Company which have occurred between the end of the financialyear of the company to which the financial statements relate and the date of the report.

Acknowledgement

The Directors would like to thank all shareholders customers bankerssuppliers and everybody else with whose help cooperation and hard work the Company isable to achieve the results. The Directors would also like to place on record theirappreciation of the dedicated efforts put in by the employees of the Company.

For and On behalf of the Board of Directors Kanani Industries Limited
PREMJIBHAI KANANI
Place: Mumbai CHAIRMAN WHOLE-TIME DIRECTOR
Date: 06-08-2022 (DIN : 01567443)

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