Your Directors are pleased to present the Twenty Eighth Annual Reporton the business and operations of the Company together with the Audited FinancialStatements for the year ended 31st March 2021.
The Company's financial performance for the year ended 31st March 2021is summarized below. Segment wise reporting as per Accounting Standards AS-17 is notapplicable to your Company since your Company is engaged in the activity of singlesegment only.
|Particulars ||Year ended 31.03.2021 ||Year ended 31.03.2020 |
| ||(Rs. in Lakhs) ||(Rs. in Lakhs) |
|Revenue from operations ||18411.05 ||20288.82 |
|Other income ||251.33 ||79.99 |
|Total Income from operations ||18662.38 ||20368.81 |
|Cost of Material Consumed ||8841.92 ||14213.56 |
|Depreciation and amortization expenses ||136.00 ||126.15 |
|Finance Cost ||31.09 ||87.72 |
|Other Expenses ||999.74 ||1051.25 |
|Profit / Loss Before tax ||8214.43 ||3517.20 |
|Tax Expense ||1945.34 ||922.58 |
|Total Comprehensive Income Net of Tax ||6269.09 ||2594.63 |
|Earnings per share || || |
|Basic ||144.03 ||61.39 |
|Diluted ||143.77 ||59.45 |
The Gross Revenue from operations for FY 2020-2021 was at Rs. 18662.38Lakhs/- (Previous Year Rs. 20368.81 Lakhs/-) registering a marginal decrease of 8.38%.
The Company earned a Profit after tax of Rs. 6269.09 Lakhs as againstRs. 2594.63 Lakhs for the previous year thereby registering a growth of 141.61%.
Consequent to the restrictions imposed by Central and State Governmentsdue to CORONA break out the plant remained closed from 23.03.2020 to 15.05.2020 whichresulted in no production and sales.
EXTRACT OF ANNUAL RETURN
In accordance with Section 92(3) read with Section 134(3)(a) of theAct the Annual Return as on March 31 2021 is available on the website of the Company athttp://www.kklgroup.in/investor_info.php
DIVIDEND AND TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) &(k) OF THE COMPANIES ACT 2013
Your Directors recommend a final dividend of Rs. 4 (40%) per fully paidup equity share of the face value of Rs. 10 per share. Payment of Dividend is subject tothe approval of Shareholders at the ensuing Annual General Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Board ofDirectors to the best of their knowledge and ability confirm that:
i. in the preparation of the annual accounts the applicable accountingstandards have been followed and there are no material departures;
ii. 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 as at 31st March 2021and of the profit of the Company for the year ended on that date;
iii. the Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv. the Directors have prepared the annual accounts on a going concernbasis;
v. the Directors have laid down internal financial controls to befollowed by the Company and such internal financial controls are adequate and operatingeffectively;
vi. the Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
During the year 105370 the equity share warrants was converted in toequity shares. Also Company has bought back 20529 shares during the year and hence thepaid up Equity Share Capital as at March 31 2021 stood at Rs. 43438910/-. During theyear under review the company has not issued shares with differential voting rights norhas granted any stock options or sweat equity.
INFORMATION ABOUT HOLDING / SUBSIDIARY/ JV/ ASSOCIATE COMPANY
The Company does not have any Holding Subsidiary Joint venture orAssociate Company.
The Board of Directors of the company comprises of Two ManagingDirector One Whole-time Director who are the Promoters of the company and FourNon-Executive Directors including Three Independent Directors. The Company also has OneWomen Director who is Non Executive and also promoter. The composition of the Board ofDirectors is in compliance with Section 149 of the Companies Act 2013.
The Company has received necessary declarations from the IndependentDirectors under section 149(7) of the Companies Act 2013 stating that they meet thecriteria of independence as specified in Section 149(6) of the Companies Act 2013 and asper Regulation of the SEBI (Listing Obligations and Disclosures Requirements) Regulations2015.
In accordance with the provisions of Section 152 of the Companies Act2013 and the Company's Articles of Association Mrs. Pushpa S Jain (DIN:06939054) NonExecutive Director retires by rotation at the forthcoming Annual General Meeting andbeing eligible offers herself for re-appointment. The Board recommends her reappointmentfor the consideration of the Members of the Company at the ensuing Annual General Meeting.
Mr. Narasimhan Raghu stepped down from the Board as IndependentDirector of the Company with effect from the close of business hours on 12.08.2020 for thepurpose of his professional career development. Mr. R Kannan (DIN: 08837382) wasappointed as the Independent Director of the Company in the Board Meeting held on24.08.2020 and also regularized in the 27th Annual General Meeting of the Company held on25.09.2020.
During the Year Mr. Dipesh S Jain who was a Whole Time Director of theCompany was appointed as the Joint Managing Director in the 27th Annual General Meeting ofthe Company held on 25.09.2020 for the period of 5 years with effect from 25.09.2020.
Mr. Arun V Shah who was appointed as an Additional Director in theBoard meeting held on 22.08.2019 was regularized as a Whole Time Director of the Companyin the 27th Annual General meeting of the Company for the period of 5 years effective from25.09.2020.
NUMBER OF MEETINGS OF THE BOARD
During the year 2020-21 Eight (08) Board Meetings were held thedetails of which are given in the Corporate Governance Report.
KEY MANAGERIAL PERSONNEL
The following are the Key Managerial Personnel of the Company as on31.03.2021:
a) Mr. Suresh Shah (DIN: 01659809) Managing Director
b) Mr. Dipesh S Jain (DIN: 01659930) Joint Managing Director
c) Mr. Arun V Shah (DIN: 01744884) Whole Time Director
d) Mr. K. C. Radhakrishnan Chief Financial Officer*
e) Mr. J. R. Vishnu Varthan Company Secretary *Retired on 30.04.2021
COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. CSR Committee
The details of the Committees along with their composition number ofmeetings and attendance at the meetings are provided in the Corporate Governance Report.
(a) STATUTORY AUDITOR
As per the provisions of Sections 139 142 and other applicableprovisions of the Companies Act 2013 if any read with the Companies (Audit andAuditors) Rules 2014 the Auditors M/s. P. Chandrasekar LLP Chartered Accountants(Firm Registration Number: 000580S/S200066) were appointed as Statutory Auditors of theCompany at the 24th Annual General Meeting held on 28.09.2017 for a period of Five (5)consecutive Financial Years till the conclusion of Twenty Ninth Annual General Meeting.
There are no qualifications or adverse remarks in the Statutory AuditReport which require any explanation from the Board of Directors.
(b) COST AUDITOR
Pursuant to Section 148 of the Act read with the Companies (CostRecords and Audit) Rules 2014 and amendments thereof the Company is required to maintaincost accounting records in respect of certain specified products of the and accordinglysuch accounts and records are made and maintained in the prescribed manner. Further thecost accounting records maintained by the Company are required to be audited.
For the financial year 2020-21 M/s. N. Sivashankaran& Co wasappointed as Cost Auditors. On the recommendation of the Audit Committee the Board hasre-appointed M/s. N. Sivashankaran& Co. Cost Accountants as Cost Auditor for auditingthe cost records of the Company for the financial year 2021-22.
The Act mandates that the remuneration payable to the Cost Auditor isratified by the shareholders. Accordingly a resolution seeking the shareholders'ratification of the remuneration payable to the Cost Auditors for the FY 2021-22 isincluded in the Notice convening the 28th Annual General Meeting. During the year theCompany filed the Cost Audit Report for the financial year 2019-20 with the Ministry ofCorporate Affairs within the prescribed time limit.
(c) SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act 2013and rules made there under the Company has appointed Mr. Lovelish Lodha M PracticingCompany Secretary to undertake the Secretarial Audit of the Company. The Secretarial AuditReport is annexed as Annexure-7 to this Report.
The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
(d) INTERNAL AUDITOR
Pursuant to the provisions of Section 138 of the Companies Act 2013and rules made there under the Company has appointed M/s. R. Subramanian and Co. LLPChartered Accountants to undertake the Internal Audit of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
During the year under review the Company did not provide any loansguarantees or made any investments u/s 186 of the Companies Act 2013.
PARTICULARS OF CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All transactions entered with Related Parties for the year under reviewwere on arm's length basis
All related party transactions are placed before the Audit Committeefor approval. Details of the transactions are provided in form AOC-2 in terms of Section134 of the Companies Act 2013 is appended as Annexure-2 to this Report.
CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING
The Company has a policy viz. "Code of Conduct for prevention ofInsider Trading" and the same has been posted on its website http://www.kklgroup.in/.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OFTHE COMPANY
There were no material changes and commitments affecting the financialposition of the Company between the end of the financial year (31.03.2021) and the date ofthe report.
CORPORATE SOCIAL RESPONSIBILITY
The Company does meet the provisions laid down in Section 135 of theCompanies Act 2013 read with Companies (Corporate Social Responsibility Policy) Rules2014 hence the Company has constituted a Corporate Social Responsibility Committee. TheCSR Report for the Financial Year 2019-20 is annexed to this report as Annexure 4. Thecomposition of CSR Committee and the details of the ongoing CSR projects/programs/activities are included in the CSR report/section. The CSR policy is uploaded onthe Company's website at the web link: http://www.kklgroup.in/admin/pdfupload/csr%20policy.pdf
DEPOSITS FROM PUBLIC
During the year under review your company did not accept any depositswithin the meaning of provisions of Chapter V Acceptance of Deposits by the CompaniesAct 2013 read with the Companies (Acceptance of Deposits) Rules 2014.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Your Company has internal control system which includes financialcontrol commensurate with the size scale and complexity of company's operations and alsoensures that the Company's assets are well protected. The internal audit evaluates theefficacy and adequacy of internal control system in the Company its compliance withaccounting procedures and policies of the Company. The Audit Committee of the Board ofDirectors actively reviews the adequacy and effectiveness of the internal control systemsand suggests improvements to strengthen the same.
The Company is not only committed to maintain the standards ofCorporate Governance set out by SEBI but also morally committed to its members. As perRegulation 34 (3) read with Schedule V of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a separate section on corporate governance practicesfollowed by the Company together with a certificate from the Company's Auditorsconfirming compliance forms an integral part of this Report.
Your Company is maintaining cost records and reports in pursuant to theCompanies (Cost Records and Audit) Rules 2014 as amended prescribed by the CentralGovernment under sub - section (1) of Section 148 of the Companies Act 2013.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy to report genuine concerns orgrievances. Your company hereby affirms that no complaints were received during the year.
Pursuant to the provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 a structuredquestionnaire was prepared after taking into consideration the various aspects of theBoard's functioning composition of the Board and its Committees culture execution andperformance of specific duties obligations and governance. The performance evaluation ofthe Independent Directors was completed. The performance evaluation of the ManagingDirector and the Non-Independent Directors was carried out by the Independent Directors.The Board of Directors expressed their satisfaction with the evaluation process.
The criteria for performance evaluation have been detailed in theCorporate Governance Report.
REMUNERATION AND NOMINATION POLICY
The Board of Directors has framed a policy which lays down a frameworkin relation to remuneration of Directors Key Managerial Personnel and Senior Managementof the Company and the policy is available in the Company's websitehttp://www.kklgroup.in/ . This policy also lays down criteria for selection andappointment of Board Members. The details of this policy are explained in the CorporateGovernance Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of theCompany as required under SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is provided in a separate section and forms a part of this Report asAnnexure-1.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its futureoperations.
CRYPTO CURRENCY AND VIRTUAL CURRENCY
During the year under review your Company has not traded or investedin any type of Crypto or Virtual currency.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNING AND OUTGO
The information on conservation of energy technology absorption andforeign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act2013 read with the Rule 8(3) of the Companies (Accounts) Rules 2014 is annexed asAnnexure-3 and forms a part of this Report
Your Company as part of Standard Operating System and Procedureinstitutionalized risk management covering risk identification mitigation and managementmeasures. This Risk Charter and Policy have been brought to practice as per part ofinternal control systems and procedures. The Management has applied the risk managementpolicy to activities and processes of the business and this is reviewed to ensure thatexecutive management manages risk through means of a properly defined framework.
DETAILS IN RESPECT OF FRAUDS
The Company's Auditor's report does not have any statement on suspectedfraud in the company operations to explain as per Sec. 134(3)(ca) of the Companies Act2013.
DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
Your Company has zero tolerance for sexual harassment at workplace andhas adopted a policy and implemented an effective mechanism for the preventionprohibition and redressal of sexual harassment at workplace in line with the provisions ofthe Sexual Harassment of Women at Workplace (Prevention Prohibition & Redressal) Act2013 the Company has formulated and implemented a policy on prevention of sexualharassment at the workplace with a mechanism of lodging complaints. During the year underreview no complaints were received by the Board.
PARTICULARS OF EMPLOYEES
The Disclosure required under Section 197(12) of the Companies Act2013 read with the Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 relating to the ratio of remuneration of each director to themedian employee's remuneration is annexed as Annexure-5 to this Report.
APPRECIATIONS AND ACKNOWLEDGMENTS
Your Directors place on record their appreciation to employees at alllevels for their dedication and commitment. Your Directors would also like to expresstheir sincere appreciation for the assistance and co-operation received from the banksfinancial institutions Government Authorities customers vendors and members during theyear under review.