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Lakhotia Polyesters (India) Ltd.

BSE: 535387 Sector: Industrials
NSE: N.A. ISIN Code: INE191O01010
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OPEN 10.65
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VOLUME 9
52-Week high 10.65
52-Week low 7.60
P/E
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
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Lakhotia Polyesters (India) Ltd. (LAKHOTIAPOLY) - Director Report

Company director report

To

The Shareholders

Lakhotia Polyesters India Limited

Your Directors are pleased to present the 15th Annual Report on thebusiness and operations of the Company and the accounts for the Financial Year ended March31 2020.

 

1. FINANCIAL SUMMARY OR HIGHLIGHTS / PERFORMANCE OF THE COMPANY

The Board's Report shall be prepared based on the standalone financial statementsof the Company.

(Rs. in Lakhs)

Particulars FINANCIAL YEAR
2019-2020 2018-2019
Total Income 1639.27 2030.96
Less: Expenditure 1725.97 2111.99
Profit Before Finance Cost Depreciation & Tax -86.70 -81.03
Less: Finance Cost 59.29 72.27
Less: Depreciation 15.06 15.73
Net Profit Before Tax & Extraordinary Item -12.35 6.97
Less: Extraordinary Item 0 0
Less :Tax Expense 0.32 4.80
Net Profit After Tax -12.67 2.17

 

2. COVID-19

In the last month of FY 2020 the COVID-19 pandemic developed rapidly into a globalcrisis forcing governments to enforce lock-downs of all economic activity. For theCompany the focus immediately shifted to ensuring the health and well-being of allemployees and on minimizing disruption to services for all our customers. As of March 312020 work from home was enabled to close to 90 percent of the employees. Although thereare uncertainties due to the pandemic and reversal of the positive momentum gained in thelast quarter of FY2020 the Company will try to navigate the challenges ahead and gainmarket share.

 

3. BRIEF DESCRIPTION OF THE COMPANY'S OPERATIONS DURING THE YEAR / STATE OFCOMPANY'S AFFAIR

During the current period of operation your company have losses of Rs. 12.67Lakhs.

 

4. FINANCIAL YEAR

This report of Directors along with its Annexure Management Discussion andAnalysis Corporate Governance Report Financial Statements along with their Notes areprepared for the period April 1 2019 to March 31 2020 (a period of 12 months). Pursuantto the provisions of Section 2(41) of the Companies Act 2013 a ‘financial year' inrelation to the Company means the period ending on the 31st day of March every year inrespect whereof financial statement of the Company is made. Your Company is in compliancewith the provisions of the Companies Act 2013.

 

5. DIVIDENDS AND RESERVES

The Company has decided to sustain the growth in line with the long-term growthobjectives of the Company by retaining the profits and utilizing the same foropportunities in hand.

 

6. SHARE CAPITAL

During the period April 1 2019 to March 31 2020 during the year under reviewthe Company has not issued shares with differential voting rights nor has granted anystock options or sweat equity and there is no change in the Issued Subscribed and paid upshare Capital of Company. The Share Capital Audit as per the directives of the Securitiesand Exchange Board of India (SEBI) is being conducted by M/s. RM Mimani & AssociatesLLP Practicing Company Secretaries. The paid-up Share Capital of the Company stands atRs. 104739880/- (Rupees Ten Crores Forty-Seven Lakh Thirty-Nine Thousand and EightHundred and Eighty Only).

 

7. TRANSFER TO RESERVES

No amount has been transferred by the Company to Reserves during the year.

 

8. PUBLIC DEPOSITS

The Company has neither invited nor accepted any public deposits during the periodunder review.

 

9. SUBSIDIARY AND ASSOCIATE COMPANIES

As on March 31 2020 Company does not have any subsidiary or associate company.

 

10. CONSOLIDATED FINANCIAL STATEMENT

The Company is not required to consolidate its financial statements in terms ofprovisions of Companies Act 2013 and rules thereunder.

 

11. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act the Board of Directors to the best of itsknowledge and ability confirm that: -

a) in the preparation of the annual accounts the applicable accounting standardshave been followed and there are no material departures;

b) they have selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;

c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual accounts on a going concern basis;

e) they have laid down internal financial controls to be followed by the Companyand such internal financial controls are adequate and operating effectively;

f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.

 

12. DIRECTORS AND KEY MANAGERIAL PERSONNEL

a) During the year Mr. Shailesh Mistry who was reappointed on 01-04-2019 resignedfrom the post of Independent directorship on 14-11-2019.

b) Mr. Sajan Choudhary the Independent Director of the company resigned on30-05-2019.

c) The designation of Ms. Jayshree Lakhotia was changed from Executive Director toNon-Executive Director on 14-11-2019 and was designated as the Chairperson of the Company.

d) Mr. Madhusudhan Lakhotia was reappointed as the Managing Director of the Companyfor a period of 5 years w.e.f. 01-04-2019

e) Two Independent Director Mr. Sri Gopal Mundra and Mr. Vashishtha Mohan Pandiyawas appointed as the Additional Director of the Company on 31-05-2019 and theirdesignation was regularised as the Independent Directors of the Company on 29-09-2019.

f) Pursuant to the provisions of Section 149 of the Act the independent directorshave submitted declarations that each of them meet the criteria of independence asprovided in Section 149(6) of the Act along with Rules framed thereunder and Regulation16( 1)(b) of the SEBI Listing Regulations. There has been no change in the circumstancesaffecting their status as independent directors of the Company. Mr. Sri Gopal Mundra andMr. Vashishtha Mohan Pandiya are Independent Directors of the Company. Based on theconfirmations received from Directors none of the Directors are disqualified fromappointment under Section 164 of the Companies Act 2013.

g) The Company has appointed Mr. Madhusudhan Lakhotia as the Managing Director Ms.Jayshree Lakhotia as the Chairman & Mr. Vivek Rathi as the Chief Financial Officer inaccordance with the provisions of Section 2(51) 203 of the Companies Act 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended from time to time. Ms. Shannu Chaturvedi is the Company Secretary and ComplianceOfficer of the Company.

h) i) The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of the CorporateGovernance Report of this Annual Report.

j) Mr. Ashok Kumar Khajanchi retires by rotation and being eligible offers himselffor reappointment. A resolution seeking shareholders' approval for his re-appointmentforms part of the Notice.

k) During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than sitting feescommission if any and reimbursement of expenses incurred by them for the purpose ofattending meetings of the Board / Committee of the Company.

l) Pursuant to the provisions of Section 203 of the Act the Key ManagerialPersonnel of the Company as on March 31 2020 are: Mr. Madhusudhan Lakhotia ManagingDirector Mr. Vivek Rathi Chief Financial Officer and Ms. Shannu Chaturvedi CompanySecretary & Compliance Officer of the Company.

 

13. NUMBER OF MEETINGS OF BOARD OF DIRECTORS

Seven meetings of the Board were held during the year under review. For details ofmeetings of the Board please refer to the Corporate Governance Report which is a part ofthis report.

 

14. BOARD EVALUATION

Pursuant to the provisions of Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the board has carried out an annualperformance evaluation of its

own performance the Directors individually as well as the evaluation of theworking of its Audit Committee Nomination and Remuneration Committee and StakeholdersRelationship Committee. The manner in which the evaluation has been carried out has beenexplained in the Corporate Governance Report.

 

15. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Company's policy on appointment of directors is available onwww.lakhotiapoly.in. The policy on remuneration and other matters provided in Section178(3) of the Act has been disclosed in the Corporate Governance Report which is a partof this report and is also available on www.lakhotiapoly.in.

 

16. INTERNAL FINANCIALS CONTROLS

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses were observed. The details in respect of internal financial controland their adequacy are included in the Management Discussion and Analysis which is a partof this report.

 

17. COMMITTEES OF THE BOARD

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders' Relationship Committee

Details of Committee and their meetings are detailed in Corporate GovernanceReport.

 

18. AUDITOR'S REPORT AND SECRETARIAL AUDIT REPORT

The statutory auditor's report and the secretarial audit report do not contain anyqualifications reservations or adverse remarks or disclaimer. Secretarial audit reportis attached to this report.

 

19. VIGIL MECHANISM

The Vigil Mechanism of the Company which also incorporates a whistle blower policyin terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015includes an Ethics & Compliance Task Force comprising senior executives of theCompany. Protected disclosures can be made by a whistle blower through an e-mail ordedicated telephone line or a letter to the Task Force or to the Chairman of the AuditCommittee. The Vigil Mechanism / Whistle Blower Policy has been uploaded on the Company'sWebsite i.e. www.lakhotiapoly.in.

 

20. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY

Details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Companies Act 2013 (if any) are given in the notes to the FinancialStatements.

 

21. BUSINESS RISK MANAGEMENT

The Company has a robust Business Risk Management (BRM) framework to identifyevaluate business risks and opportunities. This framework seeks to create transparencyminimize adverse impact on the business objectives and enhance the Company's competitiveadvantage. The business risk framework defines the risk management approach across theenterprise at various levels including documentation and reporting. The framework hasdifferent risk models which help in identifying risks trend exposure and potential impactanalysis at a Company level as also separately for business. The Company has adopted riskmanagement policy.

 

22. RELATED PARTY TRANSACTIONS

The information on transactions with related parties pursuant to Section 134(3)(h)of the Act read with Rule 8(2) of the Companies (Accounts) Rules 2014 are given in FormNo. AOC-2 and the same forms part of this report.

 

23. CORPORATE SOCIAL RESPONSIBILITY

The Company does not exceed the threshold limits mentioned in Section 135 (1) ofthe Companies Act 2013. Therefore the provisions pertaining to Corporate SocialResponsibility are not applicable to the Company.

 

24. EXTRACT OF ANNUAL RETURN

As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) ofthe Companies (Management and Administration) Rules 2014 an extract of annual return inMGT 9 as a part of this Annual Report as Annexure I. The same is available on thewebsite of the company on www.lakhotiapoly.in.

 

25. PARTICULAR OF EMPLOYEES

Particulars of employees as required u/s 134 of the Companies Act 2013 are notannexed since the executive directors are not drawing any salary till date during the yearunder review and the independent directors are getting sitting fees.

Further the information required pursuant to Section 197 of the Companies Act 2013(the Act) read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company will be provided uponrequest. In terms of Section 136 of the Act the Report and Accounts are being sent to theMembers and others entitled thereto excluding the information on employees' particularswhich is available for inspection by the Members at the Registered Office of the Companyduring business hours on working days of the Company up to the date of the ensuing AnnualGeneral Meeting. If any Member is interested in obtaining a copy thereof such Member maywrite to the Compliance Officer in this regard.

 

26. DISCLOSURE REQUIREMENTS

As per SEBI Listing Regulations the Corporate Governance Report with the Auditors'Certificate thereon and the Management Discussion and Analysis Report are attached whichforms part of this report. The Company has devised proper systems to ensure compliancewith the provisions of all applicable Secretarial Standards issued by the Institute ofCompany Secretaries of India and that such systems are adequate and operating effectively.

 

27. DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from public and as such no amount onaccount of principal or interest on deposits from public was outstanding as on the date ofthe balance sheet.

 

28. CONSERVATION OF ENERGY TECHNICAL ABSORPTION. FOREIGN EXCHANGE EARNING:

(A) Conservation of Energy

Your company is taking continuously taking initiatives to ensure optimumutilization of energy available in day to day operations. Your company uses energyefficient lighting devices light fittings to save energy capacitor bank/devices tomaintain power factor which are environment and power efficient.

 

(B) Technology Absorption

Your company is doing its business by ensuring optimum utilisation of its availableresources. Your company has not taken any research & development activity so far.

 

(C) Foreign Exchange Earnings and Outgo

The Company has not incurred in foreign currency during the financial year 2018-19.

 

29. WHISTLE BLOWER POLICY

The Company has adopted a ‘Whistle Blower Policy' with an objective to conductits affairs in a fair and transparent manner and by adopting the highest standards ofprofessionalism honesty integrity and ethical behaviour. The Company has establishedmechanism for reporting concerns about unethical behaviour actual or suspected fraudviolation of Code of Conduct and Ethics.

The Whistle Blower Policy has been posted on the website of the Companywww.lakhotiapoly.in.

 

30. NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relationto remuneration of Directors Key Managerial Personnel and Senior Management of theCompany. This policy also lays down criteria for selection and appointment of BoardMembers.

 

31. SIGNIFICANT AND MATERIAL OREDERS PASSED BY REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators/Courts thatwould impact the going concern status of the Company and its future operations.

 

32. ADEQUACY OF INTERNAL CONTROL SYSTEM

The Company has adequate internal control systems for the business processes inrespect of all operations financial reporting compliance with laws and regulations etc.The management information system forms an effective and sound tool for monitoring andcontrolling all operating parameters. Regular internal audits ensure that responsibilitiesare executed effectively. The Audit Committee reviews the adequacy of internal controls onregular basis.

 

33. CODE OF CONDUCT

The Board has laid down a Code of Conduct for all Board members and seniormanagement personnel of the Company which is available on website of the company. TheCompany has obtained confirmations for the compliance with the said code from all itsBoard members and senior management personnel for the year ended March 31 2020.

 

34. DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS

All Independent Directors have given necessary declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Companies Act 2013 andRegulation 16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulation2015 as amended.

 

35. NOMINATION AND REMUNERATION COMMITTEE

The Company follows a policy on "Nomination and Remuneration of Directors Keymanagerial Personnel and Senior Management". The policy is approved by the Nomination& Remuneration Committee and the Board. More details on the same are given in AnnexureII.

36. STATUTORY AUDITORS

M/s R R Gujrathi & Co. Chartered Accountants were appointed as StatutoryAuditors of your Company in 2017 for a term of five consecutive years. The requirement toplace the matter relating to appointment of auditors for ratification by Members at everyAGM has been done away by the Companies (Amendment) Act 2017 with effect from May 72018. Accordingly no resolution is being proposed for ratification of appointment ofstatutory auditors at the 15th AGM.

The Report given by the Auditors on the financial statements of the Company is partof the Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report apart from the undisputed statutory duesunpaid by our company including Provident Fund Employees" State InsuranceIncome-tax (TDS) Profession Tax as applicable with the appropriate authorities inIndia. The Management reply on the observation stated in the said Report forms a part ofDirectors Report in Annexure III.

37. SECRETARIAL AUDITORS

The Board of Directors have appointed M/s. R. M. Mimani & Associates asSecretarial Auditors to conduct Secretarial Audit for the Financial Year 2019-20.

The Secretarial Audit Report issued by M/s. R. M. Mimani & Associates CompanySecretaries in Practice is self-explanatory and does not call for further comments. TheSecretarial Audit Report and Management reply on the qualifications stated in the saidReport forms a part of Directors Report in Annexure IV.

38. AUDIT COMMITTEE

The composition of Audit Committee is as follows:

Name of Directors Designation in Committee Category
Mr. Sri Gopal Mundra Chairman Non-Executive Independent Director
Mr. Vashishtha Mohan Pandiya Member Non-Executive Independent Director
Mr. Madhusudan Lakhotia Member Managing Director
Mr. Sajan Choudhary* Chairman Non-Executive Independent Director
Mr. Shailesh Mistry* Member Non-Executive Independent Director

 

*Mr. Sajan Choudhary resigned from the post of Independent Directorship w.e.f30-05-2019 *Mr. Shailesh Mistry resigned from the post of Independent Directorship w.e.f.14-11-2019

During the Financial Year 2019-20 Audit Committee met 5 times on 31.05.201914.08.2019 05.09.2019 14.11.2019 and 14.02.2020. All the recommendations made by theaudit committee were accepted by the board. Frequency and quorum at these meetings were inconformity with the provisions of the Companies Act 2013 Listing Agreement and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 entered into by thecompany with the Stock Exchange.

 

39. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

The Company has always believed in providing a safe and harassment free workplacefor every individual through various interventions and practices.

The Company always endeavours to create and provide an environment that is freefrom discrimination and harassment including sexual harassment. The Company has in placean Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment ofWomen at the Workplace (Prevention Prohibition & Redressal) Act 2013. InternalComplaints Committee (ICC) has been set up to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis policy. No complaints were received by the company during the year for sexualharassment.

In order to build awareness in this area the Company has been conductingprogrammes in the organisation on a continuous basis.

 

40. MANAGEMENT DISCUSSION AND ANALYSIS

In compliance with the Regulation 34 (2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (‘Listing Regulations') a separatesection on the Management Discussion and Analysis Report giving details of overallindustry structure developments performance and state of affairs of Company's businessforms an integral part of this Report.

 

41. CORPORATE GOVERNANCE

In compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance along with a certificate from the Auditors on its compliance formsan integral part of this report.

The extract of annual return in Form MGT-9 as required under Section 92(3) of theAct and Rule 12 of the Companies (Management and Administration) Rules 2014 is appendedas an Annexure to this Report

 

42. CAUTIONARY STATEMENT

Statements in the Annual Report particularly those which relate to ManagementDiscussion and Analysis describing the Company's objectives projections estimates andexpectations may constitute ‘forward looking statements' within the meaning ofapplicable laws and regulations. Although the expectations are based on reasonableassumptions the actual results might differ.

 

43. HUMAN RESOURCES

Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invest in attraction retention and development oftalent on an on-going basis. A number of programs that provide focused people attentionare currently underway. Your Company thrust is on the promotion of talent internallythrough job rotation and job enlargement. The Human Resource agenda continues to supportthe business in achieving sustainable and responsible growth by building the rightcapabilities in the organisation. It continues to focus on progressive employee relationspolicies creating an inclusive work culture and a strong talent pipeline.

 

44. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).

 

45. DISCLOSURE ABOUT COST AUDIT

As per the Cost Audit Orders Cost Audit is not applicable to the Company.

 

46. LISTING WITH STOCK EXCHANGE

The Company is listed on Main Board of BSE Limited. The Company confirms that ithas paid the Annual Listing Fees for the year 2020-2021 to BSE Limited where the Company'sShares are listed.

 

47. APPRECIATIONS AND ACKNOWLEDGMENTS

Your Directors wish to express their appreciation and gratitude to all theemployees at all levels for their hard work dedication and cooperation during the year.Your Directors wish to express their sincere appreciation for the excellent support andco-operation extended by the Company's shareholders customers bankers suppliersregulatory and government authorities and all other stakeholders.

The Directors regret the loss of life due to COVID-19 pandemic and are deeplygrateful and have immense respect for every person who risked their life and safety tofight this pandemic.

The Directors also take this opportunity to thank all Shareholders ClientsVendors Banks Government and Regulatory Authorities and Stock Exchanges for theircontinued support.

For and on behalf of the Board
Lakhotia Polyesters India Limited
Sd/-
Madhusudhan Lakhotia
(Managing Director)
Place: Nashik
Date: 27.08.2020

 

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