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M K Proteins Ltd.

BSE: 538420 Sector: Industrials
NSE: MKPL ISIN Code: INE964W01013
BSE 00:00 | 28 Mar M K Proteins Ltd
NSE 00:00 | 18 Oct 150.10 -7.90
(-5.00%)
OPEN

150.10

HIGH

150.10

LOW

150.10

OPEN 10.04
PREVIOUS CLOSE 10.04
VOLUME 24
52-Week high 10.04
52-Week low 0.00
P/E 0.40
Mkt Cap.(Rs cr) 4
Buy Price 10.35
Buy Qty 1400.00
Sell Price 0.00
Sell Qty 0.00
OPEN 10.04
CLOSE 10.04
VOLUME 24
52-Week high 10.04
52-Week low 0.00
P/E 0.40
Mkt Cap.(Rs cr) 4
Buy Price 10.35
Buy Qty 1400.00
Sell Price 0.00
Sell Qty 0.00

M K Proteins Ltd. (MKPL) - Director Report

Company director report

To The Members

Your directors have pleasure in presenting the 8th Annual Report togetherwith the Audited Statements of Accounts of the Company for the financial year ended 31stMarch 2020:

1. Financial Highlights:

2019-20 2018-19
Revenue from Operations 19412.26 15677.30
Operating Expenditure 18933.16 15180.00
Other Income (Net) 31.50 7.26
Earning before interest tax depreciation and amortization (EBITDA) 510.60 504.56
Finance Costs 149.18 153.70
Depreciation and amortization expenses 117.10 122.35
Profit before exceptional item and tax 244.32 228.51
Exceptional item 0.00 0.00
Profit Before Tax (PBT) 244.32 228.51
T ax Expenses 62.63 64.19
Profit After T ax (PAT) 181.69 164.32
Add: Balance Brought forward from previous year 461.78 297.46
Less: Income Tax for earlier years adjusted 1.26 0.00
Amount of Surplus available for appropriation 642.19 461.78

2. Operations State of Company's affairs and Future Outlook:

Our Company is a manufacturing and trading organization having its production/refiningplant of Edible Oils. Our manufacturing process involves refining of Crude Oils to obtainRefined Rice Bran Oil Canola Oil Soya Bean Oil Sunflower Oil and Rice Bran BleachedOil. During the refining process certain by-products are also manufactured such as RiceBran Fatty Acid Oil Rice Bran Wax Gums and Spent Earth which are also saleable. Furtherit also imports crude oils process them and sell the finished product and trade in bothedible and non-edible oils. In the current year 2019-20 the Company has earned the totalrevenue from operation Rs.19412.26 Lacs against the previous year Rs.15677.30 whichreflects growth of 23.82% w.r.t. previous year. The net profit after tax of the company isalso increased from Rs.164.32 Lacs to Rs.181.69 Lacs in the year 2019-20. The managementof the Company expect better results in the ensuing year because the product of theCompany has demand since its nature of human consumption in the ensuing financial yearand years to come. We further inform that there is no change in the business activities ofthe company in the current financial year.

Effect of COVID - 19 on Business operation of the Company: In the last month of FY2020 the COVID-19 pandemic developed rapidly into a global crisis forcing governments toenforce lockdowns of all economic activity except "essential activity" severelyrestricted travel mandated extreme ‘social distancing' measures to prevent the rapidrise of infections. The Company is engaged in manufacturing of essential commodities i.e.Refined Oil hence the operations was partly impacted due to nationwide lockdown. Thecrisis has affected and continues to impact our key stakeholders - employees clientscustomers and the communities that we operate in. In responding to this crisis theprimary objective of the company is to ensure the safety of our employees and onminimizing disruption to services for all our customers at different area through outcountry. The Company has considered the possible impact of the outbreak of COVID - 19pandemic on business operations and carrying amounts of current and non-current assets ofthe Company. In developing the assumptions relating to the possible future uncertaintiesin the economic environment because of this pandemic the Company as at the date ofapproval of these financial statements has used internal and

external sources of information including credit reports and related informationeconomic forecasts. The Company has concluded that the carrying amount of these assetswill be recovered no adjustments are required in the financial statements as it does notimpact the current financial year. However the situation with COVID-19 is evolving andvarious preventive measures taken are still in force leading to highly uncertain economicenvironment and its impact on the Company's business operation also. Due to thesecircumstances the management's assessment of the impact on the subsequent period isdependent upon the circumstances as they evolve and Company's financial statements maydiffer from that estimated as at the date of approval of these financial statements.

3. Dividend:

No dividend has been recommended by the Directors this year and consequently no amountshave been transferred to general reserves.

4. Transfer to Reserves:

The board of the Company has decided not to transfer any fund to general reserve out ofthe amount available for appropriation and an amount of surplus Rs.642.19 Lacs to beretained in the profit and loss account.

5. Change in Share Capital if any

There has been no change in Share Capital of the Company during the financial year2019-2020.

6. Listing of Shares

The shares of the Company are listed on the Emerge SME Platform of the National StockExchange of India Limited w.e.f. 18 April 2017. Applicable listing fees have been paid upto date. The shares of the Company have not been suspended from trading at any time duringthe year by the concerned Stock Exchange.

7. Deposits:

The company has not accepted any deposits from the public during the year and as suchno amount on account of principal or interest on deposits from public was outstanding ason the date of the balance sheet.

8. Directors:

As per the provisions of Section 152 of the Companies Act 2013 Sh. Parmod KumarDirector of the Company retires by rotation at the forthcoming Annual General Meeting andbeing eligible offered himself for re-appointment. The Board recommends hisre-appointment.

The notice convening the Annual General Meeting includes the proposal for appointmentof Director.

Mr. Chatter Singh has already attained the age of seventy five (75) years. Pursuant toRegulation 17(1A) of the Listing Regulations the Special Resolution for continuation ofhis directorships with effect from April 1 2019 up to March 3 2022 being the date ofexpiry of their current term of office will be required to be passed and Board recommendpassing of same.

Further your Company has also received declarations from all the Independent Directorsof the Company confirming that they meet with the criteria of Independence as prescribedunder the Act and as per Listing Agreement with the Stock Exchanges.

9. Board Evaluation:

Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the ListingAgreement the Board has carried out the annual performance evaluation of its ownperformance the Directors individually as well as the valuation of the working of itsvarious committees as per the criteria of evaluation provided in the NominationRemuneration and Evaluation Policy adopted by the Company. The performance evaluation ofIndependent Directors was carried out by the entire Board and the performance evaluationof the Chairman and the Board as a whole was carried out by the Independent Directors.

10. Meetings of the Board:

The Board of Directors of your company met 09 times during 2019-20. The meetings wereheld on 30/04/2019 08/05/2019 30/05/2019 27/06/2019 27/08/2019 25/09/201914/11/2019 23/12/2019 and 20/03/2020. The intervening gap between the meetings was withinthe period prescribed under the Companies Act 2013.

11. Particulars of Loan given Investment made Guarantee given and Securitiesprovided:

There were no loans given investment made guarantee given and securities provided bythe Company under Section 186 of the Companies Act 2013 during the year under review andhence the said provision is not applicable.

12. Extract of Annual Return:

As provided under Section 92(3) of the Act the extract of annual return is given inAnnexure I in the prescribed Form MGT-9 which forms part of this report.

13. Subsidiary Joint Ventures and Associate Concerns:

The Company does not have any Subsidiary Joint Ventures or Associate Concerns as on 31stMarch 2020.

14. Corporate Governance:

The Company has been exempt from reporting on Corporate Governance as per Regulation 15of the SEBI (Listing Obligation and Disclosure requirements) Regulation 2015. ThereforeCorporate Governance Report is not provided.

15. Management's Discussion and Analysis Report

Management's Discussion and Analysis Report for the year under review as stipulatedunder SEBI (Listing obligation and Disclosure Requirements) Regulations 2015 asapplicable is presented in a separate section forming part of the Annual Report.

16. Directors' Responsibility Statement:

In accordance with the provisions of Section 134(5) of the Companies Act 2013 thedirectors hereby confirm that:

i) in the preparation of the annual accounts for the financial year ended 31stMarch 2019 the applicable accounting standard have been followed and there are nomaterial departures;

ii) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as at 31st March 2020 and of the profitof the Company for the period from 1st April 2019 to 31st March2020;

iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

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

v) they have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively; and

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

17. Contract and arrangements with Related Parties:

The Company's policy on dealing with related party transactions has been formulated andamended from time to time. All contracts/arrangements/ transactions entered by the Companyduring the financial year with related parties were in the ordinary course of business andon the arm's length basis. There are no materially significant related party transactionsmade by the company with promoters directors key managerial personnel or otherdesignated persons which may have a potential conflict with the interest of the companyat large. Your Directors draw attention of the

members to Note 29(h) to the financial statements which set out related partydisclosures pursuant to listing agreement. Information on transactions with relatedparties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies(Accounts) Rules 2014 are given in Annexure II in Form AOC-2 and the same forms part ofthis report.

18. Auditor and Auditors' Report:

M/s Jayant Bansal & Co. Chartered Accountants Ambala Cantt Statutory Auditors ofthe company holds office till the conclusion of the ensuing Annual General Meeting andare eligible for appointment and ratification and approval of their appointment for thefinancial year ending 31st March 2021.

M/s Jayant Bansal & Co. Chartered Accountants Ambala Cantt who were appointed asStatutory Auditors for a period of 3 years from 31st March 2020 to 31stMarch 2022 being eligible for appointment and approval at this Annual General Meeting haveagreed to act Statutory Auditors to the Company for the financial years ending 31stMarch 2020 to 31st March 2022.

As required under the provisions of section - 139(1) of the Companies Act 2013 thecompany has received a written consent from M/s Jayant Bansal & Co. CharteredAccountant to their appointment and a certificate to the effect that theirre-appointment if made would be in accordance with the Act and the Rules framed thereunder and that they satisfy the criteria provided in section- 141 of Companies Act 2013.The Board recommends ratification of their appointment for the financial years ending 31stMarch 2021.

The report of Statutory Auditors (appearing elsewhere in this Annual Report) isself-explanatory having no adverse comments. There were no instances of fraud reported bythe Statutory Auditors to the Central Government or to the Audit Committee of the Companyas indicated under the provisions of Section 143(12) of the Companies Act 2013.

Further auditor's report for the financial year ended 31st March 2020 isgiven as an annexure which forms part of this report.

19. Secretarial A uditors:

Pursuant to provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s J. P. Jagdev & Co. Ambala City a firm of Company Secretaries inpractice to conduct Secretarial Audit for the financial year 2019-20. The SecretarialAudit Report for the financial year ended 31st March 2020 is annexed herewithas Annexure III to this Report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.

20. Corporate Social Responsibility (CSR):

The Company is not required to constitute a Corporate Social Responsibility Committeeas it does not fall within purview of Section 135(1) of the Companies Act 2013 and henceit is not required to formulate policy on corporate social responsibility.

21. Risk Management:

The board of the Company has formed a risk management committee to frame implementand monitor the risk management plan for the Company. The Committee is responsible forreviewing the risk management plan and ensuring its effectiveness. The audit committee hasadditional oversight in the area of financial risks and controls. Major risks identifiedby the businesses and functions are systematically addressed through mitigating actions ona continuing basis.

22. Internal Control System and their adequacy:

The Company's internal controls are commensurate with the size of the company and thenature of its business. These have been designed to provide reasonable assurance withregard to recording and providing reliable financial and operational informationcomplying with applicable statutes safeguarding assets from unauthorized use executingtransactions with proper authorization and ensuring compliance of corporate policies. Thecompany has an audit committee the details of which are provided in the CorporateGovernance Report. The audit committee reviews the internal control

system and follows up on the implementation of corrective actions if required. Thecommittee also meets the company's statutory auditors to ascertain interalia their viewson the adequacy of internal control system in the Company and keeps the Board of Directorsinformed of its major observations from time to time. The management also regularlyreviews the utilization of fiscal resource compliance with law efficiencies so as toensure optimum utilization of resources and achieve better efficiencies. Based on itsevaluation (as defined in section 177 of Companies Act 2013) our audit committee hasconcluded that as of March 31 2020 our internal financial controls were adequate andoperating effectively.

23. Vigil Mechanism Policy:

The Company has a vigil mechanism policy which also incorporates a whistle blowerpolicy in line with the provisions of the Section 177(9) and (10) of the Companies Act2013 and regulation 22 of the Listing Regulations which deals with the genuine concernsabout unethical behaviour actual or suspected fraud and violation of the Company's Codeof Conduct and ethics.

24. Committees of Board:

The Board of Directors of your Company had already constituted various committees incompliance with the provisions of the Companies Act 2013 and Listing Agreement viz. AuditCommittee Nomination and Remuneration Committee and Shareholder's/Investor's RelationshipCommittee. All decisions pertaining to the constitution of committees appointment ofmembers and fixing the terms of reference / role of the Committees are taken by the Boardof Directors. Detail of the role and composition of Committees including the number ofmeetings held during the financial year and attendance at meetings are provided inannexure - IV which forms part of this report.

25. Conservation of Energy Technology absorption and foreign exchange earning andoutgo:

Information required under Section 134(3) (m) of Companies Act 2013 read withCompanies (Accounts) Rules 2014 is given as under:

(A) Conservation of energy:

(i) The steps taken or impact on conservation of energy: The Company is usingGovernment supply of electricity and own generation by its generators.

(ii) The steps taken by the company for utilizing alternate sources of energy: Thereare no alternate sources of energy with the Company.

(iii) The capital investment on energy conservation equipments: Investment on energyconservation equipments is made wherever it is possible mostly it is NIL.

(B) Technology absorption:

(i) The efforts made towards technology absorption: Plant and machinery are indigenousand no machinery and technology has been imported by the Company

(ii) The benefits derived like product improvement cost reduction product developmentor import substitution: Indigenous machinery is state of Art and the company derivesbenefits on cost reduction of production.

(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) - : No technology has been imported by theCompany.

(iv) The expenditure incurred on Research and Development: No specific expenditure isincurred on Research and Development.

(C) Foreign exchange earnings and Outgo:

The Company's main line of business is processing of vegetable edible oils. The Companyhas not earned and spent foreign exchange during the current and previous year.

26. Nomination Remuneration and Evaluation Policy:

The Nomination Remuneration and Evaluation Policy recommended by the Nomination andRemuneration Committee is duly approved by the Board of Directors of the Company and thesame are provided in annexure - IV which forms part of this report.

27. Human Resources:

Your Company treats its "human resources" as one of its most important assetsand has taken continuous efforts to set up and maintain an efficient work force. Thecompany is continuously taken steps towards maintaining a low attrition rate which itbelieves shall be achieved by investing in learning and development programmes foremployees competitive compensation creating a compelling work environment empoweringemployees at all levels as well as a well-structured reward and recognition mechanism.

28. Particulars of Employees:

I) The information required under Section 197 of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:

a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:

Executive Director Ratio to median Remuneration
1 Sh. Vinod Kumar (Managing Director) 0.20:1
2. Sh. Raj Kumar (Whole Time Executive Director) 0.20:1

Note: The Company has not given any remuneration/benefits to non-executive/independentdirectors of the company during the year 2019-20 except directors' sitting feeRs.250000.000 to Non-executive Independent directors.

b. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year:

Directors Company Secretary and Financial Officer % increase in remuneration in the financial year
1 Sh. Vinod Kumar (Managing Director) NIL
2. Sh. Raj Kumar (Whole Time Executive Director) NIL
3. Ms. Prerna Mehta (Company Secretary) NIL
4. Sh. Nipun Garg (Financial Officer) NIL

c. The percentage increase in the median remuneration of employees in the financialyear:

2%

d. The number of permanent employees on the rolls of Company: 39 Employees as on 31stMarch 2020.

e. The explanation on the relationship between average increase in remuneration andCompany performance: The performance of the Company for the current financial year isbetter than the previous year. The Company has minor increase in remuneration to ExecutiveDirector/key managerial personnel. However at Middle & Junior level management theproper increment was given in accordance with the inflation rate and at workmen and stafflevel.

f. Comparison of the remuneration of the key managerial personnel against theperformance of the Company: Remuneration to Managing and Whole Time directors were paid asper the scale approved by the members of the company. The head (Corporate Finance) waspromoted to the position of Financial Officer hence he was given an increase as a part ofpromotion and salary adjustment.

g. Variations in the market capitalization of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year:

Particulars March 31 2020 March 31 2019 % Change
Market Capitalization (Rs. In Lacs) 2977.95 3107.25 -6.70

h. Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the Last publicoffer:

Particulars March 31 2019 March 31 2019 % Change
Market Price (NSE) 71.40 (Average Price) 73.55 (Average Price) -2.15

i. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration: Properincrements at both managerial and staff/worker level has been given in financial year2019-20.

j. Comparison of each remuneration of the key managerial personnel against theperformance of the Company: The head (Corporate Finance) was promoted to the position ofFinancial Officer hence he was given an increase as a part of promotion and salaryadjustment.

k. The key parameters for any variable component of remuneration availed by thedirectors:

No such variable component is included in the remuneration paid to directors.

l. The ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid directorduring the

year: Sh. Raj Kumar (Whole Time Director): 0.20:1

m. Affirmation that the remuneration is as per the remuneration policy of the Company:The

Company affirms remuneration is as per the remuneration policy of the Company.

II. There was no employee on the roll of the company who drew remuneration in excess ofthe limits prescribed by the provisions of Section 197(12) of the Companies Act 2013 readwith Rules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 hence this relevant information is not applicable to the Company.

29. Disclosure under sexual harassment of women at workplace (Prevention Prohibition& Redressal) Act 2013:

The company has complied with provisions relating to the constitution of InternalComplaints Committee under the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 (114) of 2013.

30. CFO Certification:

In compliance with Regulation 17(8) of the Listing Regulations a declaration by CFOwas placed before the Board certifying the accuracy of Financial Statements and theadequacy of internal controls pertaining to Financial Reporting for the year ended 31stMarch 2019 is attached herewith as per Annexure - V.

31. Auditors' Certificate on Corporate Governance:

As per Regulation 15 of the SEBI (Listing Obligation And Disclosure Requirement)Regulations 2015 the compliance with the Corporate Governance provisions shall not applyin respect of (a) listed entity having paid up equity share capital not exceeding tencrore and net worth not exceeding rupees twenty five crore as on the last day of previousyear (b) the listed entity which has listed its specified securities on the SME Exchange.Hence Auditors' Certificate on Corporate Governance is not provided.

32. Code of Conduct::

The Board of Directors has an important role in ensuring good Corporate Governance andhas laid down the Code of Conduct for Directors and Senior Management of the Company. TheCode has also been posted on the website of the Company. All Directors and SeniorManagement personnel have affirmed the compliance thereof for the year ended March 312020.

Declaration

I hereby declare that pursuant to Schedule V (Part D) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors of the Company haveadopted a Code of Conduct for the Board members and Senior Management of the Company andthe same has also been posted in the Company's website and that all the Board members andSenior Management personnel to whom this Code of Conduct is applicable have affirmed thecompliance of the said Code of Conduct during the year 2019-20.

Ambala Vinod Kumar

4th September 2020 (Managing Director)

33. Other Disclosures:

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

i) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

ii) No Material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which these financial statements relateand the date of this Report.

2. The provisions of Section 125(2) of the Companies Act 2013 related with transfer ofunclaimed dividend to Investor Education and Protection Fund do not apply to the Companyas there was no dividend declared and paid in previous years and there is no unclaimeddividend.

3. Equity Shares:

• No issue of equity shares with differential rights as to dividend voting orotherwise during the year under review.

• The Company has not bought back any of its securities during the year underreview.

• No issue of shares (including sweat equity shares) to employees of the Companyunder Stock option Scheme during the year under review.

• No Shares outstanding under the head Shares Suspense Account/Unclaimed SuspenseAccount at the beginning and end of the year under review.

34. Acknowledgements:

Your directors wish to place on record their gratitude for the valued support andassistance extended to the Company by the Shareholders Banks and Government Authoritiesand look forward to their continued support. Your directors also express theirappreciation for the dedicated and sincere services rendered by the Executives Officersand Employees of the Company.

By Order of the Board of Directors

Place: Ambala
Dated: 04-09-2020 Sd/-
(VINOD KUMAR)
Managing Director
DIN: 00150507

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