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Madhya Bharat Agro Products Ltd.

BSE: 538370 Sector: Agri and agri inputs
NSE: MBAPL ISIN Code: INE900L01010
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Madhya Bharat Agro Products Ltd. (MBAPL) - Director Report

Company director report

For the Year 2021-2022

Dear Members

Your Directors have pleasure in presenting the 25th Annual Reporttogether with the Audited Accounts of the Company for the year ended 31st March 2022.

FINANCIAL HIGHLIGHTS:

(Rs. in Lakhs)

Particulars 2021-2022 2020-2021
Turnover and Other Income 49174.80 18586.77
Profit Before Taxation 8117.87 2857.56
Taxation/Deferred Tax 2415.83 833.37
Profit / (Loss) after Tax 5702.04 2024.19
Other comprehensive income 3.19 -14.62
Total comprehensive income 5705.23 2009.58
Earning Per equity Share 26.03 9.24

PERFORMANCE REVIEW AND STATE OF COMPANY'S AFFAIR

During the year ended the Company has reported revenue from operationsof Rs 491.49 crores in its business registering at strong growth of 164.65 %.

The Net Profit for the year ended March 31 2022 stood at Rs 57.02crores translating into a healthy annual growth of 181.69%. The Earnings per share for theyear is Rs. 26.03 compared to Rs. 9.24 for the last year.

COVID-19 IMPACT

The COVID-19 pandemic continued to be a global challenge creatingdisruption across the world. In the first three months of FY 2022 affected most ofbusiness operations.

COVID-19 is an unprecedented challenge. The Company is taking allnecessary measures in terms of mitigating the impact of the challenges being faced in thebusiness. The Company operates its business in conformity with the protocol prescribed byGovt authorities with highest safety and well-being of all the stakeholders includingworkers and staff at all its plant locations various branch offices and the head office.

CHANGE IN THE NATURE OF BUSINESS OF COMPANY

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

LISTING OF THE COMPANY

The Shares of your Company are listed on Platform of "NationalStock Exchange". The annual Listing Fees for the Year 2022-23 has been paid to theexchange.

SHARE CAPITAL

During the year ended 31st March 2022 there was no change in theissued and subscribed capital of the Company the capital as on 31st March 2022 continuesto be 2190.67 Lakhs comprising of 219.07 Lakhs shares of 10/- each.

ANNUAL RETURN:

The information required pursuant to the provisions of Section 134 (3)(a) and Section 92 (3) of the Companies Act 2013 read with Rule 12 of Companies(Management and Administration) Rules 2014 the Annual Return for the financial yearended on March 31st 2022 is available on the website of the Company viz. http://www.mbapl.com

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

Pursuant to Regulation 34 of the Listing Regulations the BusinessResponsibility and Sustainability Report for the financial year ended 31st March 2022 isprovided in Annexure I forming part of this report.

STATUTORY AUDITORS & STATUTORY AUDITORS' REPORT

The term of M/s. Rajneesh Kanther & Associates CharteredAccountants statutory auditors of the company will be expiring in the conclusion of this25th Annual General Meeting therefore the Board has recommended the appointment of M/sAshok Kanther & Associates Statutory Auditors of the Company for a term of 05 yearsfrom the conclusion of this annual general meeting till the conclusion of 30th AGM held inthe year 2027 subject to approval of shareholders of the Company.

M/s Ashok Kanther & Associates have confirmed their eligibility tothe effect that their appointment if made would be within the prescribed limits underthe Act and that they are not disqualified for appointment.

The Auditor's Report is self-explanatory and therefore does not callfor any further comments/ clarifications and Auditor's report does not contain anyqualification reservation or adverse remarks.

SECRETARIAL AUDITOR & SECRETARIAL AUDITORS' REPORT

Pursuant to the provisions of Section 204(1) of the Companies Act 2013and the Companies (Appointment & Remuneration of Managerial personnel) Rules 2014the company has appointed M/s Sourabh Bapna & Associates a practicing companySecretaries to undertake the Secretarial Audit of the Company for financial year 2022-23.The Company has received their consent for Re-appointment.

The Secretarial Audit report for financial year 2021-22 received fromSourabh Bapna & Associates is provided in Annexure II forming part of this report. TheSecretarial Audit report does not contain any qualification reservation or adverseremarks.

COST AUDITOR

The Company has made and maintained cost accounts and records asspecified by the Central Government under Section 148(1) of the Companies Act 2013.

For the financial year 2021-22 M/s. K. C. Moondra & AssociatesCost Accountant have conducted the audit of the cost records of the Company.

In accordance with the provisions of Section 148 of the Companies Act2013 and the Companies (Audit and Auditors) Rules 2014 and on the recommendation of theAudit Committee the Board has appointed M/s K.C. Moondra & Associates CostAccountants (Registration No. 101814) at such remuneration as shall be fixed by the boardof Directors of the Company to conduct the audit of the cost records of the Company forthe financial year ending 31st March 2023. The Re-appointment and the remuneration of thecost Auditor is required to be ratified subsequently by the Members of the Company andfurther subject to the approval of the Central Government.

The Company has received their written consent and confirmation thatthe Re-appointment will be in accordance with the applicable provisions of the Act andrules framed thereunder.

INTERNAL AUDITOR & AUDITORS' REPORT

As per section 138 of The Companies Act 2013 read with Rule 13 ofCompanies (Accounts) Rules 2014 the company has Re-Appointed M/s Sourabh Bapna &Associates Practicing Companies Secretaries as Internal Auditor to conduct Internal Auditfor the Financial Year 2022-2023.The Company has received their consent forRe-appointment.

The Internal Audit Report is received by the Company and the same isreviewed and approved by the Audit Committee and Board of Directors for the year2021-2022. All the observations made by the Internal Auditors have been attended to.

INTERNAL CONTROL SYSTEM

The company has in place an adequate internal control system which iscommensurate with the size scale and complexity of the company. The internal auditorsindependently evaluate the adequacy of internal controls and concurrently audit themajority of the transactions in value terms. Independence of the audit compliance isensured by the direct reporting of Internal Audit Division and Internal Auditors to theAudit Committee of the Board.

During the period under review the Internal Financial Control weretested and no reportable material weakness in the design or operation were observed.

REPORTING OF FRAUDS BY AUDITORS IF ANY

No fraud has been reported by auditors under section 143 (12) of thecompanies act 2013.

RESERVES

During the year under review The Board of Directors of the Company hasnot recommended for transfer of any amount to the Reserve from surplus for the FinancialYear ended March 31 2022. An amount of 16663.35 Lakhs (previous year 11070.84 Lakhs) isproposed to be held as Retained Earnings.

DIVIDEND

The Directors are pleased to recommend a final dividend of 0.50 pershare (i.e. 5%) on the Equity Shares of the Company of 10 each for the year ended March31 2022 (previous year 0.50 per share). The dividend payout is subject to the approval ofthe members at the ensuing Annual General Meeting.

The Dividend payout for the Financial Year under review is inaccordance with the Company's Dividend Distribution Policy.

In terms of Regulation 43A of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 the DividendDistribution Policy of the Company is made available on the website of the Company viz.www.mbapl.com.

DEPOSITS

The Company has not accepted any deposits covered under section 73 ofthe Companies Act 2013.

NO DEFAULT

The company has not defaulted in payment of interest and / or repaymentof loan to any of the financial institutions and/or bank.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with provisions of Companies Act 2013 and Company'sArticles of Association Mr. Sourabh Gupta (DIN 07177647) Director of the Company retireby rotation and being eligible offers himself for re-appointment. The Board recommendshis re-appointment.

Mr. Pankaj Ostwal Managing Director of the Company Mr. Sourabh GuptaWhole Time Director & Chief Financial Officer and Ms. Pallavi Sukhwal CompanySecretary of the Company were designated as Key Managerial Personnel of the Companypursuant to Section 203 of the Companies Act 2013.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The policy on appointment of directors remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the Corporate GovernanceReport which is a part of this report and is also available on the Company's website atwww.mbapl.com.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received necessary declaration from each IndependentDirector under Section 149(7) of the Companies Act 2013 to the effect that they meet thecriteria of independence laid down in Section 149(6) of the Companies Act 2013. The termsand conditions for appointment of the Independent Directors are incorporated on thewebsite of the Company.

The Board is of the opinion that the Independent Directors of theCompany possess requisite qualifications experience and expertise and that they holdhighest standards of integrity.

NUMBER OF MEETINGS OF BOARD OF DIRECTORS

The Board of Directors duly met 11 (Eleven) times on 29th April 202110th June 2021 15th June 2021 29th July 2021 07th August 2021 27th August 2021 9thNovember 2021 22nd November 2021 01st December 2021 04th February 2022 and 28th March2022 in F.Y. 2021-22 for which proper notices were given and the proceedings were properlyrecorded and signed in the Minutes Book maintained for the purpose.

INSOLVENCY AND BANKRUPTCY CODE & ONE-TIME SETTLEMENT

The company does not make any application under the Insolvency andBankruptcy Code 2016 and There is no proceeding pending against the Company under theInsolvency and Bankruptcy Code 2016 (IBC Code).

Further there has not been any instance of one-time settlement of theCompany with any bank or financial institution.

PARTICULARS OF EMPLOYEES

The information required pursuant to the Section 197(12) of theCompanies Act 2013 read with Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 in respect of ratio of remuneration of each director tothe median remuneration of the employees of the Company is provided in Annexure IIIforming part of this report.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGOING

The details as required under section 134 (3) (m) of the Companies Act2013 read with the Rule 8 of Companies (Account) Rule 2014 for conservation of EnergyTechnology Absorption and Foreign Exchange earnings and outgo are given in Annexure IVforming part of this report.

PARTICULAR OF LOAN GUARANTEE AND INVESTMENT UNDER SECTION 186

The information required for loans given investment made or guaranteegiven or security provided during the year under section 186 of the Companies Act 2013read with the rule 11 of Companies (Meetings of Board and its power) Rule 2014 isprovided in Annexure V forming part of this report and also provided in the financialstatement of the Company (please refer Notes of the balance sheet).

RISK MANAGEMENT

Proper Risk Management Practices have been followed for the purpose ofrisk identification analysis and mitigation planning monitoring and reporting.Although all risks cannot be eliminated but mitigation and contingency plans aredeveloped to lessen their impact if they occur.

COMPLIANCE WITH THE SECRETARIAL STANDARDS:

The Company is in compliance with the Secretarial Standards issued bythe Institute of Company Secretaries of India (ICSI) as applicable.

RELATED PARTY TRANSACTION UNDER SECTION 188

All related party transactions that were entered into during thefinancial year were on arm's length basis and were in the ordinary course of the business.There are no materially significant related party transactions made by the company duringthe financial year which were in the conflict of interest of the company.

Information on transactions with related parties pursuant to Section134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are givenin Annexure VI in Form AOC-2 and the same forms part of this report.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Corporate Governance and Management Discussion & AnalysisReport as required pursuant to the SEBI ((Listing Obligations & DisclosureRequirements) Regulations 2015 is provided in Annexure VII and Annexure VIIIrespectively forming part of this report.

BOARD EVALUATION:

Pursuant to the relevant provisions of the Companies Act 2013 and theListing regulations the Board has carried out an annual performance evaluation of itsown working of its Committees and the Directors. The Nomination and RemunerationCommittee has carried out evaluation of every Director. The Independent Directorsevaluated performance of the Non-Independent Directors the Board as whole and theChairperson of the Company.

COMMITTEES OF BOARD:

The Board of Directors of your Company has constituted the followingcommittees in terms of the provisions of the Companies Act 2013 and the SEBI (ListingObligations and Disclosures Requirements) Regulation 2015:

AUDIT COMMITTEE DISCLOSURE UNDER SECTION 177:

The Audit Committee of the Company consists of 2 Independent Directorsand 1 Executive Director. The Chairman of the Audit Committee is financially literate andmajority of them having accounting or related financial management experience. CompanySecretary acts as Secretary to the Committee.

The following Directors are the members of Audit Committee.

(1) Shri Arvind Kothari Chairman
(2) Shri Pankaj Ostwal Member
(3) Shri Bheru Lal Ostwal Member

During the year the Committee had 4 Meetings i.e. on 15th June 202129th July 2021 9th November 2021 and 04th February 2022.

NOMINATION & REMUNERATION COMMITTEE DISCLOSURE UNDER SECTION 178:

In pursuant to the provisions of section 178 (4) of the Companies Act2013 the Nomination and Remuneration Policy recommended by the Nomination andRemuneration committee is duly approved by the Board of Directors of the Company. Policyis disclosed on the website of the Company viz. www.mbapl.com

The following Directors are the members of nomination and RemunerationCommittee.

(1) Shri Bheru Lal Ostwal Chairman
(2) Shri Arvind Kothari Member
(3) Shri Paras Mal Surana Member

The Committee meets Twice in a year and also as and when anyremuneration is to be fixed for any Director /Managing Director and Key ManagerialPersonnel. During the year the Committee had a Meetings i.e. on 29th April 2021 27thAugust 2021.

STAKEHOLDER RELATIONSHIP COMMITTEE:

The following Committee of Directors looks after the InvestorGrievances:

(1) Shri Arvind Kothari Chairman
(2) Shri Pankaj Ostwal Member
(3) Shri Bheru Lal Ostwal Member

During the year the 4 Stakeholder Relationship Committee Meetings wereheld on 15th June 2021 29th July 2021 09th November 2021 and 04 th February 2022.

INDEPENDENT DIRECTORS COMMITTEE:

The following are the members of independent director s committee:

(1) Shri Bheru Lal Ostwal Chairman
(2) Shri Arvind Kothari Member
(3) Shri Paras Mal Surana Member

During the year under review the Independent Directors met on 04thFebruary 2022.

CORPORATE SOCIAL RESPONSIBILITY:

In pursuant to the provisions of section 135 and schedule VII of theCompanies Act 2013 CSR Committee of the Board of Directors was formed to recommend (a)the policy on Corporate Social Responsibility (CSR) and (b) implementation of the CSRProjects or Programme to be undertaken by the Company as per CSR Policy for considerationand approval by the Board of Directors. CSR Policy is disclosed on the website of theCompany viz. http://mbapl.com/pdf/CSRPolicyMBAPL.pdf

As per provision of new enacted Company Act 2013 the Board ofDirectors have formed Corporate Social Responsibilities Committee having the followingmembers: -

(1) Shri Arvind Kothari Chairman
(2) Shri Paras Mal Surana Member
(3) Shri Bheru Lal Ostwal Member

Our Company considers social responsibility as an integral part of itsbusiness activities and endeavors to utilize allocable CSR budget for the benefit ofsociety.

During the year the Committee had 2 Meetings i.e. on 09th November 2021and 28th March 2022. Annual Report on Corporate Social Responsibility of the Company isprovided in Annexure IX forming part of this report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

The Company has established vigil mechanism policy for Directors andemployees to report concerns about unethical behavior actual or suspected fraud orviolation of Company's Code of Conduct or Ethics Policy. Vigil Mechanism Policy isdisclosed on the website of the Company viz. http:// mbapl.com/pdf/Vigil-mechanism.pdf

MATERIAL CHANGES AND COMMITMENTS:

No material changes and commitments affecting the financial position ofthe Company occurred between the ends of the financial year to which this financialstatement relate on the date of this report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators orCourts or Tribunal which would impact the going concern status of the Company and itsfuture operation.

SUBSIDIARY JOINT VENTURE AND ASSOCIATE COMPANY:

The Company does not have any Subsidiary Joint Venture and AssociateCompany.

CREDIT RATINGS:

During fiscal 2022 Infomerics Valuation and Rating Pvt. Ltd.(Integrated Financial Omnibus Metrics Research of International Corporate Systems) hasassigned following Credit Ratings in respect of borrowings availed by the Company-

• Rating upgraded from 'IVR BBB+/Stable' to 'IVR A-/Stable' on thelong-term fund based bank facilities - Term Loan and Cash Credit.

• Rating upgraded from 'IVR A2' to 'IVR A2+' on the short termnon-fund based bank facilities - Letter of credit.

• Rating upgraded from 'IVR A2' to 'IVR A2+' on the short termnon-fund based bank facilities - (PSR) Pre Settlement Risk.

• Rating assigned as 'IVR A-/Stable' on the long-term fund basedbank facilities - GECL (Working Capital Term Loan)

• Rating assigned as 'IVR A-/ Stable' on the proposed long-termfund based facilities -Cash Credit.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The company has in place an Anti-Sexual Harassment Policy in line withthe requirement of the Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013. Internal Complaints Committee (ICC) has been set upto redress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainee) are covered under this policy.

The following is a summary of sexual harassment complaints received anddisposed off during the year 2021-2022.

No. of complaints received: Nil No. of complaints disposed off: Nil

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134 (3) (c) & 134 (5) ofthe Companies Act 2013 with respect to Directors Responsibility Statement it is herebyconfirmed:

a) That in the preparation of the Accounts for the Financial Year ended31st March 2022 the applicable accounting standards have been followed along with properexplanation relating to material departures.

b) That the Directors have selected such accounting policies andapplied them consistently and made judgments and estimates that were reasonable andprudent so as to give a true and fair view of the state of affairs of the Company at theend of the financial year and of profit of the company for the year under review.

c) That the Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities.

d) That the Directors have prepared the accounts for the financial yearended 31st March 2022 on a going concern basis.

e) That 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) That the directors had devised proper system to ensure compliancewith the provisions of all applicable laws and that such system were adequate andoperating effectively.

HEALTH SAFETY AND QUALITY MANAGEMENT

Your Company is ISO 9001:2015 certified and maintains high quality ofproduct and processes and the company is conscious about its responsibility towards theupkeep of environment and maintenance of high safety and health standards at its workplaces.

ACKNOWLEDGEMENT

The Directors are thankful to the Central and State GovernmentDepartments Organizations and Agencies for their continued guidance and co-operation. TheDirectors are grateful to all valuable Stakeholders Dealers Vendors Banks and otherbusiness associates for their excellent support and help rendered during the year. TheDirectors also acknowledged the appreciation to the team of executives staff and workerswho have shown devotion and efficiency in performing their jobs.

For and on behalf of the Board of Directors
Sd/- Sd/-
(Pankaj Ostwal) (Sourabh Gupta)
Place Bhilwara Managing Director Whole Time Director & Chief Financial Officer
Date 30.05.2022 DIN 02586806 DIN 07177647

.