Lords Chloro Alkali Ltd.
|BSE: 500284||Sector: Industrials|
|NSE: MODIALKALI||ISIN Code: INE846D01012|
|BSE 00:00 | 25 Nov||252.80||
|NSE 05:30 | 01 Jan||Lords Chloro Alkali Ltd|
|Mkt Cap.(Rs cr)||636|
|Mkt Cap.(Rs cr)||635.79|
Lords Chloro Alkali Ltd. (MODIALKALI) - Director Report
Company director report
Your Directors are pleased to present the 43 rd Annual Report togetherwith the Audited Financial Statements of the Company for the Financial Year ended on 31stMarch 2022.
i. financial performance
2. performance and state of company affairs
Your Company has been able to produce 60083 MT of Caustic during theyear against 59150 MT in the previous year. Further the company has also commissioned thenew Sodium Hypochlorite plant of 80 TPD capacity. The Company has initiated a plan toincrease the Caustic soda capacity to 300 TPD and manufacturing of additional new productsi.e. Stable Bleaching Powder (SBP) and Chlorinated Paraffin wax (CPW). The company hasbeen able to maintain a healthy profitability and based on the current market scenario thetrend is likely to continue well into the next year.
Year 2021-22 has witnessed an upsurge in the demand for Chlor-alkaliproducts after the Covid wave seen in first quarter. Our products performance are linkedto country?s GDP growth as caustic soda is used in Aluminium paper textile andother industries while co
product chlorine is used in manufacturing of other chemicals used indifferent industries and in water treatment process. Production at the user industries wasreasonably good which has resulted in enhanced demand for our products. Prices of causticsoda depends on the demand and supply condition within India and on international priceschlorine prices are dependent on the local user conditions only. Caustic soda prices hikedsubstantially in line with international prices and the quantum driven by improved pricerealization during the year so the higher earnings were possible due to enhanced marginsin the operations.
4. Completion of Open Offer
The Company had received a Public Announcement of Open Offer of theCompany vide email dated 28th July 2021 made by Corporate Professionals Capital PrivateLimited on behalf of Mr. Madhav Dhir Ms. Srishti Dhir and Dhir Hotels and Resorts PrivateLimited (Acquirers?) to acquire 9275000 Equity Shares representing 36.87% ofthe Total Paid-up Share Capital of Lords Chloro Alkali Limited (TargetCompany?) at a price of INR 47.75 (Indian Rupees Forty Seven and Seventy Five Paisaonly) for each Equity Share of Target Company pursuant to and in compliance withRegulation 3(2) of the Securities and Exchange Board of India (Substantial Acquisition ofShares and Takeovers) Regulations 2011 and subsequent amendments thereto (SEBI(SAST) Regulations 2011?).
However 9208945 Equity shares have been acquired by way of openoffer representing 36.61% of paid up share capital. Accordingly post offer shareholding ofAcquirers along with person acting in concert is 18795556 Equity Shares out of totalpaid-up equity share capital i.e. 25153861 representing 74.72% of paid up share capitalof the Company. The open offer have been successfully completed in the month of October2021.
5. future outlook
Indian chemicals industry stood at US$ 178 billion in 2019 and isexpected to reach US$ 304 billion by 2025 registering a CAGR of 9.3%. The demand forchemicals is expected to expand by 9% per annum by 2025. The chemical industry is expectedto contribute US$ 300 billion to India?s GDP by 2025.
The Indian economy is growing at a healthy pace and is registering oneof the highest growth rates in GDP. This has result in increased demand for company?sproducts and based on the growth in economy the same trend is likely to continue for thecoming year. Company is targeting to achieve optimum production level and salesrealization in coming year. Sodium hypochlorite and other chlorine derivatives like CPWand SBP are to be added in existing product line to avoid price fluctuations of chlorinemarket to some extent. Also the proposed capacity addition in Caustic Soda is expected toadd to top and bottom line of the company in coming years.
6. directors and key managerial personnel
Pursuant to the provisions under Section 152 of the Companies Act 2013read with the Companies (Appointment and Qualification of Directors) Rules 2014 and theArticles of
Association of Company Ms. Sristhi Dhir Non-Executive Director isliable to retire by rotation at the ensuing Annual General Meeting (AGM) and she hasoffered herself for reappointment.
Shri Rajendra Prasad Chauhan (DIN: 01444662) Non-Executive Director ofthe Company has resigned from the Board/ Committee thereof w.e.f. 26th October 2021 andhe confirmed that there is no material reason of his resignation.
Shri Nitesh Anand has joined the Company on 1st September 2021 asCompany secretary cum Compliance officer in place of Shri Dipendra Chaudhary who resignedas Company Secretary cum Compliance Officer of the Company w.e.f. 20th August 2021.
The Company has received the declaration from all Independent Directorsof the Company confirming that they meet the criteria of Independence as prescribed underthe Companies Act 2013 and SEBI (Listing obligations and Disclosure Requirements)Regulations 2015.
7. board evaluation
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listingobligations and Disclosure Requirements) Regulations 2015 the Board of Directors of theCompany in their meeting held on 11th February 2022 had carried out the annual evaluationof their own performance the Individual Directors (Including the Independent andNon-Independent Directors) as well as of their committees. The evaluation was carried outbased on parameters such as level of engagement and contribution independence ofjudgement safeguarding the interest of the Company and all stakeholders etc.
The Independent Directors of the Company in their separate meeting heldon 11th February 2022 reviewed the performance of the Non-Independent Directors and theBoard as a whole. They also reviewed the performance of the Chairperson of the Company.
The Policy on performance evaluation of Independent Directors Board ofDirectors Committees and other individual Directors covered the role rightsresponsibilities of Independent Director and related matters are put up on the website ofthe Company at the link www.lordschloro.com.
The details of programmes for familiarization of Independent Directorswith the Company their roles rights responsibilities in the Company nature of theindustry in which the Company operates business model of the Company and related mattersare put up on the website of the Company at the link www.lordschloro.com.
The following policies of the Company are attached herewith marked as AnnexureA and B.
a) Policy for selection of Directors and determining Directorsindependence; and
b) Remuneration Policy for Directors Key Managerial Personnel andother employees.
8. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS U/S 186
The Company has complied with the provisions of Sections 185 and 186 ofthe Companies Act 2013 in respect of loans granted investments made and guarantees andsecurities provided as applicable.
9. material changes and commitments if any:
There were no material changes and commitments have been occurredbetween the end of the financial year of the Company to which the financial statementsrelate and date of signing of board report affecting the financial position of thecompany.
10. details of significant and material orders passed by the regulatorsor courts or tribunals impacting the going
CONCERN STATUS AND COMPANY?S OPERATIONS IN FUTURE
The Company has not received any significant/material orders from thestatutory regulatory bodies/courts/ tribunals which affect the operations/status of theCompany.
11. cost records
The Cost accounts and records as required to be maintained underSection 148 (1) of Act are duly made and maintained by the Company.
12. statutory auditors
At the 42nd AGM of your Company the members had approved theappointment of M/s Nemani Garg Agarwal & Co Chartered Accountants (FRN-010192N) asStatutory Auditors of the Company to hold office till the conclusion of 47th AGM subjectto ratification by the Members at every Annual General Meeting.
However pursuant to the amendment in Section 139 of the Companies Act2013 requirement of the ratification of the appointment of Statutory Auditors at everyAnnual General Meeting has been omitted and accordingly the proposal for the ratificationof the M/s Nemani Garg Agarwal & Co Chartered Accountants as Statutory Auditors hasnot been considered.
13. cost auditors
The provisions of section 148 of the Companies Act 2013 read withRules 4 & 5 of the Companies (Cost Audit and Record) Rules 2014 for maintenance ofCost Records Cost Audit are applicable to the Company for the financial year 2022-23.
The Board of Directors of your Company at its meeting held on 10thAugust 2022 has on the recommendation of Audit Committee had approved the appointmentof M/s Goyal Goyal & Associates Cost Accountants as Cost Auditor of your Company toconduct the audit of cost records for the Financial Year 2022-23.
The remuneration proposed to be paid to the Cost Auditor subject toyour ratification at the 42nd AGM will be Rs. 75000/- (Rupees Seventy Five Thousand only)for the Financial Year 2022-23.
14. secretarial auditor
Pursuant to the provisions of section 204 of the Companies Act 2013and rules made thereunder the Board of Directors of the Company had appointed M/s SSPK& Co. Practicing Company Secretary as Secretarial Auditors to conduct SecretarialAudit of the Company for the financial year 2021-22. The Secretarial Audit Report for thefinancial year ended 31st March 2022 is annexed herewith as Annexure C to thisReport.
15. AUDITORS? OBSERVATIONS
The Company is required to transfer an amount of Rs. 11.64 lakhs toInvestor Education and Protection Fund under the provisions of Section 125 of theCompanies Act 2013 and other applicable provisions. However as per explanation receivedfrom management this amount due for transfer pertains to period prior to period underreview and delay is due to pending reconciliation of old records. Further the Company isin the process of reconciliation of records and will deposit the amount with appropriateauthorities.
16. safety environment protection & pollution control
Your Company is continuously making endeavours to have safe operationsby training and conducting various safety audits/ mock drills.
National Safety Council Rajasthan State Chapter has also recognizedour efforts by awarding the certificate towards standards of competence and compliance ofHealth Safety and Welfare.
The company has also commissioned the new Sodium Hypochlorite plant of80 TPD capacity thus eliminated the handling of lime powder and producing more useful anddemanding product in the market as Sodium Hypochlorite.
Company is following Covid-19 protocol strictly and ensuring that thework environment is safe and hygienic. No one is allowed to enter the plant without takingbooster dose.
17. dividend and transfer to reserve
During the Financial Year 2021-22 the Company has not declared anydividend and Rs.3233.28 Lakhs has been transferred to General Reserve. is.energyconservation technology absorption foreign exchange earning and outgoing.
In compliance with provisions of clause (m) of sub-section (3) ofSection 134 of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 thestatements giving the required information relating to energy conservation technologyabsorption foreign exchange earnings and outgoings is annexed herewith as Annexure D.
19. contracts and arrangements with related parties
>All contracts/arrangements/transactions entered by the Company duringthe financial year with related parties were in the ordinary course of business and on anarm?s length basis.
The particulars of contracts or arrangements with related partiesreferred to in Section 188(1) of the Companies Act 2013 read with rule 8(2) of theCompanies (Accounts) Rules 2014 in the prescribed Form AOC - 2 is annexed as Annexure Eto this Report.
The Policy on materiality of related party transactions and dealingwith related party transactions as approved by the Board may be accessed on theCompany?s website at the link: www.lordschloro.com.
20. particulars of employees & related disclosures
The information required under Section 197 of the Act read with rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are given below:
a) The ratio of the remuneration of each Director to the medianremuneration of the employees of the Company for the financial year:
(b) The percentage increase in remuneration of each Director ChiefFinancial Officer Company Secretary in the financial year:
* Shri Nitesh Anand (Company Secretary) joined the company in thecurrent financial year. So therefore the percentage increase cannot be ascertained.
c) The percentage increase in the median remuneration of employees inthe financial year:
The percentage increase in the median remuneration of employees in thefinancial year was 15%.
(d) the number of permanent employees on the rolls of company;
The number of permanent employees on the rolls of the company at theend of financial year were 193.
(e) average percentile increase already made in the salaries ofemployees other than the managerial personnel in the last financial year and itscomparison with the percentile increase in the managerial remuneration and justificationthereof and point out if there are any exceptional circumstances for increase in themanagerial remuneration;
Average percentile increase in the salaries of employees other than themanagerial personnel is 2.68%. Average percentile increase in the salaries of managerialpersonnel is 111.05%.
f) Affirmation that the remuneration is as per the remuneration policyof the Company:
The Company affirms that the remuneration is as per the remunerationpolicy of the Company
Pursuant to the provisions of Section 197(12) of the Act read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 no employee except Managing Director who is employed throughoutthe financial year was in receipt of remuneration of Rs. 1.33 crores (one crore and twolakh) or more per annum and no employee who is employed for a part of the financial yearwas in receipt of remuneration Rs. 8.5 lakhs ( eight lakhs fifty thousand) or more permonth. Any member interested in obtaining the information of top-10 employee of theCompany may write to the Company Secretary at the registered office or the corporateoffice of the Company.
21. annual return
The Annual Return of the Company can be accessed on the website of theCompany at following link https://www.lordschloro.com/pdfs/annual-return-2021-22. Pdf.
22. THE DETAIL OF APPLICATION MADE /PROCEEDING PENDING UNDER THEINSOLVENCY AND BANKRUPTCY CODE 2016
During the year under review the Company has not made any applicationduring the year and no proceeding is pending under Insolvency & Bankruptcy Code 2016(IBC) as at March 31 2022.
23. THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE ATTHE TIME OF ONE-TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS ORFINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF
During the year under review the Company there has been no one-timesettlement. Since there is no One-Time Settlement therefore there is no differencebetween amount of the valuation done at the time of one-time settlement and the valuationdone while taking loan from the banks or financial institutions
24. PUBLIC DEPOSITS
During the year under review your Company has not accepted any depositwithin the meaning of Sections 73 and 74 of the Companies Act 2013 read with theCompanies (Acceptance of Deposits) Rules 2014 (including any statutory modification(s) orre- enactment(s) for the time being in force).
25. CORPORATE GOVERNANCE REPORT
Pursuant to Regulation 34 read with Schedule V of SEBI (Listingobligations and Disclosure Requirements) Regulations 2015 a Report on CorporateGovernance and a Certificate from the Practicing Company Secretary confirming thecompliance with conditions of corporate governance are appended herewith.
Further as per the above mentioned regulation and Schedule the Reporton Management Discussion & Analysis is also annexed herewith to this Report.
A certificate from Managing Director and Chief Financial Officer of theCompany in terms of SEBI (Listing obligations and Disclosure Requirements) Regulations2015 inter-alia confirming the correctness of financial statements and cash flowstatements adequacy of internal control measures and reporting of matters was placedbefore the Audit Committee and Board.
26. RISK MANAGEMENT
The Company has constituted a Risk Management Committee which ensuresthat the Company has an appropriate and effective Enterprise Risk Management system withappropriate policies and processes which carries out risk assessment and ensures that riskmitigation plans are in place by validating the same at regular intervals.
Brief details about the Risk Management are provided in the CorporateGovernance Report.
27. CORPORATE SOCIAL RESPONSIBILITY
In accordance with the provision of Section 135 of the Companies Act2013 read with rules made thereunder Company has constituted Corporate SocialResponsibility Committee which framed a Board approved CSR Policy for the Company sameis available on Company?s website www.lordschloro.com.
An annual report of CSR activity has been disclosed with this report asAnnexure F.
28. MEETINGS OF THE BOARD
Five (5) meetings of the Board of Directors were held during the year.For further details please refer section of Report on Corporate Governance of this AnnualReport.
29. EXPIRATION OF TENURE OF INDEPENDENT DIRECTOR
Members of the Company at the 38th Annual General Meeting held on 27thSeptember 2017 approved the re-appointments of Mrs. Poonam Rawat Shri Rajbir SinghMakhni and Shri Pawan Kumar Nayyar as an Independent Director on the Board of Directors ofthe Company pursuant to the provisions of section 149 of the Companies Act 2013 readwith Companies (Appointment and Qualification of Directors) Rules 2014 to hold office fora second term of 5 (five) consecutive years on the Board of the Company with effect from30th September 2017 to September 30 2022.
Accordingly tenure of Mrs. Poonam Rawat Shri Rajbir Singh Makhni andShri Pawan Kumar Nayyar as an Independent Director on the Board of Directors of theCompany is going to expire on ensuing Annual General Meeting to be held on September 302022.
Subject to the approval of shareholders in ensuing Annual GeneralMeeting and to maintain the optimum composition of Board of Directors in terms of SEBI(LODR) Regulation 2015 the Board of Director had appointed Ms. Sakshi Vashisth Ms.Shubha Singh and Shri Amia Kumar Singh as an Independent Directors on the Board ofDirectors of the Company in place above retiring Directors.
30. vigil mechanism/ whistle blower policy
The Company established a vigil mechanism for directors and employeesto report concerns about unethical behaviour actual or suspected fraud or violation ofthe company?s Code of Conduct or ethics policy.
This mechanism provides adequate safeguards against victimization ofdirector(s)/ employee(s) and also provide for direct access to the Chairman of the AuditCommittee in exceptional cases.
The details of establishment of such mechanism disclosed at the websiteof the company www.lordschloro.com.
31. details on internal financial controls related to financialstatements
Your Company has put in place adequate internal financial controls withreference to the financial statements some of which are outlined below.
Your Company has adopted accounting policies which are in line with theAccounting Standards prescribed in the Companies (Accounting Standards) Rules 2006 thatcontinue to apply under Section 133 and other applicable provisions if any of theCompanies Act 2013 read with Rule 7 of the Companies (Accounts) Rules 2014 to the extentapplicable. These are in accordance with generally accepted accounting principles inIndia.
The Management periodically reviews the financial performance of yourCompany against the approved plans across various parameters and takes necessary actionwherever necessary.
Your Directors state that during the year under review there was nocase reported pursuant to the Sexual Harassment of Women at the Workplace (PreventionProhibition & Redressal) Act 2013.
33. DIRECTORS? RESPONSIBILITY STATEMENT
Your Directors state that:
a) in the preparation of the annual accounts for the year ended onMarch 31 2022 the applicable Indian Accounting Standards read with requirements set outunder Schedule III to the Act have been followed and there are no material departuresfrom the same;
b) the Directors have selected such accounting policies and appliedthem consistently and made judgements 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 the financialyear ended on 31st March 2022 and of the profit incurred by the Company for the yearended on that date;
c) 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;
d) the Directors have prepared the annual accounts on a goingconcern? basis;
e) the Directors have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and areoperating effectively; and
f) the Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems are adequate and operating.
Your Directors wish to convey their deep appreciation to all thecompany?s employees/workers for their dedication and hard work as well as theircollective contribution to the Company?s performance.
The Directors would also like to thank to the Members CustomersDealers Suppliers Bankers Financial Institutions Government Authorities and all otherbusiness associates for continued support given by them to the Company and theirconfidence in its management.