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Max Ventures and Industries Ltd.

BSE: 539940 Sector: Financials
NSE: MAXVIL ISIN Code: INE154U01015
BSE 00:00 | 29 Jul 90.40 3.90
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87.00

HIGH

93.60

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86.25

NSE 00:00 | 29 Jul 90.55 4.10
(4.74%)
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86.45

HIGH

93.40

LOW

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OPEN 87.00
PREVIOUS CLOSE 86.50
VOLUME 109933
52-Week high 93.70
52-Week low 35.50
P/E 188.33
Mkt Cap.(Rs cr) 1,326
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 87.00
CLOSE 86.50
VOLUME 109933
52-Week high 93.70
52-Week low 35.50
P/E 188.33
Mkt Cap.(Rs cr) 1,326
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Max Ventures and Industries Ltd. (MAXVIL) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 5th (Fifth) Board's Report along withthe Audited Financial Statements of your Company for the financial year ended March 312020 ("FY 2020"). This Report is prepared on the basis of standalone financialstatements of the Company for FY 2020 and the consolidated performance of the Company andits subsidiaries has been referred to wherever required.

Standalone Financial Results

The standalone financial performance of your Company is summarized below:

(Rs. in Lakhs)
Particulars FY 2019-20 FY 2018-19
Income
Revenue from Operations 2965.84 2563.65
Other Income 819.56 832.44
Total Revenues 3785.40 3396.09
Expenditure
Employee benefits expense 855.46 742.42
Finance costs 300.65 3.37
Depreciation and amortization expense 304.36 18.82
Other expenses 821.43 1536.01
Total Expenses 2281.90 2300.62
Profit/(Loss) before Tax 1503.50 1095.47
Tax expense 364.78 204.39
Profit/(Loss) after Tax 1138.72 891.08

Consolidated Financial Results

The consolidated financial performance of your Company and its subsidiaries issummarized below:

(Rs. in Lakhs)
Particulars FY 2019-20 FY 2018-19
Income
Revenue from Operations 138221.54 92269.59
Other Income 1728.07 2271.37
Total Revenues 139949.61 94540.96
Expenditure
Cost of raw materials consumed 75788.75 86029.65
Change in inventories of finished goods traded goods and work in progress 24817.49 (12225.45)
Excise duty on sale of goods - -
Employee benefits expense 5415.79 4273.86
Finance costs 7095.24 4189.45
Depreciation and amortization expense 4611.70 3047.52
Other expenses 15529.25 12306.04
Total Expenses 133258.22 97621.07
Profit/(Loss) before Tax 6691.39 (3080.11)
(Rs. in Lakhs)
Particulars FY 2019-20 FY 2018-19
Attributable tax expense 2282.04 (147.97)
Profit/(Loss) after Tax 4409.35 (2932.14)
Attributable to:
Equity holders of parent 3743.05 (2310.51)
Non-controlling interest 666.30 (621.63)

In accordance with the Companies Act 2013 ("the Act") and Regulation 34 ofthe SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015("Listing Regulations") the audited consolidated financial statements areprovided as part of this Annual Report and shall also be laid before the ensuing AnnualGeneral Meeting of the Company.

The Standalone and Consolidated Financial Statements have been prepared in accordancewith the Indian Accounting Standards (IND AS) notified under the Companies (IndianAccounting Standards) Rules 2015 (as amended from time to time).

Company's Performance / Operations

In FY 2020 the Company reported Consolidated Revenues from operations ofRs.138221.54 Lakhs and a Profit / Loss after tax of Rs. 4409.35 Lakhs.

Dividend

Considering the future business plans of the Company the Board of Directors of theCompany do not recommend any dividend on the equity shares of the Company for FY 2020.

Transfer to Reserves

Consequent to the issuance of Employee Stock Options an amount of Rs. 3.32 Lakhs hasbeen transferred to the Share Premium Account of the Company. The Company did not transferany amount out of profits to Capital Reserve during FY 2020.

Listing Information

The equity shares of the Company are traded on BSE Ltd. (Scrip Code '539940') andNational Stock Exchange of India Ltd. (Symbol 'MAXVIL') effective June 22 2016. The ISINnumber for dematerialisation of the equity shares of the Company is INE154U01015.

Changes in Share Capital

As at March 31 2020 the authorized share capital of the Company stood at Rs.1500000000 (Rupees One Hundred and Fifty Crores Only) divided into 150000000(Fifteen Crores) equity shares of Rs. 10/- (Rupees Ten only) each.

Allotment of shares under ESOP

During FY 2020 following allotment of equity shares of Rs. 10/- (Rupees Ten only) eachwere made pursuant to the exercise of Stock Options granted to Stock Option holders underMax Ventures and Industries Employee Stock Plan - 2016:

Date of Allotment No. of equity shares allotted Premium on allotment
April 19 2019 1130 Nil
December 10 2019 22150 Rs. 15/- per equity share

After taking into consideration the aforesaid allotments the paid-up equity sharecapital of the Company as at March 31 2020 stood at Rs. 1466240620/- (Rupees OneHundred and Forty Six Crores Sixty Two Lakhs Forty Thousand Six Hundred and Twenty only)comprising of 146624062 (Fourteen Crores Sixty Six Lakhs Twenty Four Thousand and SixtyTwo) equity shares of Rs. 10/- (Rupees Ten only) each.

Particulars of utilization of proceeds of the Rights Issue

The details of utilization of proceeds of rights issue has been set out in Note No. 36of the enclosed financial statements.

Subsidiaries Joint Ventures and Associates

As at March 31 2020 your Company had following subsidiaries:

(i) Max Speciality Films Limited;

(ii) Max Estates Limited ("MEL.");

(iii) Max I. Limited;

(iv) Max Asset Services Limited;

(v) Wise Zone Builders Private Limited;

(vi) Northern Propmart Solutions Limited ("NPSL"); and

(vii) Pharmax Corporation Limited ("Pharmax").

There were no associates or joint ventures of the Company during FY 2020.

NPSL was incorporated as a wholly owned subsidiary of MEL on June 24 2019. Further interms of the Shareholders' Agreement entered into between MEL New York Life InsuranceCompany ("New York Life") and NSPL on February 12 2020 New York Life acquired49% stake in NPSL on March 18 2019. Accordingly now MEL and New York Life hold shares inthe ratio of 51:49 in NPSL.

Further MEL acquired 85.17% equity shares of Pharmax from Max India Limited onNovember 25 2019. Accordingly Pharmax became a step down subsidiary of your Companyeffective that date.

Form AOC-1 containing the salient features of financial statements of the Company'ssubsidiaries is enclosed with this report as 'Annexure - 1'. The basic details of thesubsidiaries of the Company form part of the Extract of Annual Return given in 'Annexure -2' to this Report.

Further a detailed update on the performance of your Company's subsidiaries isfurnished in the Management Discussion and Analysis section which forms a part of thisReport.

In compliance with the provisions of Section 136 of the Act the financial statementsand other documents of the subsidiaries are not being attached with the financialstatements of the Company and are available on the website of the Company viz.www.maxvil.com.

The Consolidated Financial Statements presented by the Company include financialresults of its subsidiaries.

Extracts of Annual Return

An extract of the Annual Return as at March 31 2020 in prescribed Form MGT-9 formspart of this report as 'Annexure - 2'. Further the Annual Return of the Company for FY2018-19 is available on the website of the Company at https://www.maxvil.com/shareholder-information/.

Employees Stock Option Plan

Your Company has adopted an employee stock option plan viz. 'Max Ventures andIndustries Limited - Employee Stock Plan 2016' ('ESOP Plan') at its first Annual GeneralMeeting held on September 27 2016. The ESOP Plan provides for grant of stock optionsaggregating not more than 5% of equity share capital of the Company to eligible employeesand Directors of the Company. The ESOP Plan is administered by the Nomination andRemuneration Committee constituted by the Board of Directors of the Company.

The members of the Company in their Annual General Meeting held on September 24 2019approved the modification of the ESOP Plan by extending the Plan to the directors andemployees of the subsidiaries of the Company. There was no other change in the ESOP Planduring FY 2020. Further the ESOP Plan is in compliance with the Securities and ExchangeBoard of India (Share Based Employee Benefits) Regulations 2014 (as amended from time totime).

A statement setting out the details of options granted upto March 31 2020 and otherdisclosures as required under Securities and Exchange Board of India (Share Based EmployeeBenefits) Regulations 2014 and Rule 12(9) of Companies (Share Capital & Debentures)Rules 2014 for FY 2020 is enclosed as 'Annexure - 3' to this report.

Material changes between the end of financial year and the date of this Report

There were no material changes between the financial year ended March 31 2020 and thedate of this Report.

Report on Corporate Governance

The Company has complied with all the mandatory requirements of Corporate Governancespecified by the Securities and Exchange Board of India through Part C of Schedule V ofthe Listing Regulations. As required by the said Clause a separate Report on CorporateGovernance forms part of the Annual Report of the Company.

A certificate from M/s Sanjay Grover & Associates Practicing Company Secretariesregarding compliance with the regulations of Corporate Governance pursuant to Part E ofSchedule V of the Listing Regulations and a certificate from the Managing Director andChief Financial Officer on compliance of Part B of Schedule II of the Listing Regulationsforms part of the Corporate Governance Report.

Management Discussion & Analysis

In terms of Regulation 34 of the Listing Regulations a review of the performance ofthe Company including those of your Company's subsidiaries is provided in the ManagementDiscussion & Analysis section which forms part of this Annual Report.

Directors

As at March 31 2020 your Board of Directors comprised of eight members with oneExecutive Director and seven Non-Executive Directors out of which four were independent.

Due to pre-occupation Mr. Ashok Brijmohan Kacker resigned from the position ofIndependent Director of the Company on November 08 2019. The Board places on record itsappreciation for the valuable contributions made by him during his association with theCompany.

Further in compliance with the provisions of Section 161 of the Act and Articles ofAssociation of the Company the Board of Directors of the Company on the recommendation ofthe Nomination & Remuneration Committee appointed Mr. Niten Malhan (DIN: 00614624) asan Independent

(Additional) Director of the Company for a period of 5 years with effect from November08 2019 which is subject to approval by the shareholders at the ensuing Annual GeneralMeeting of the Company.

In terms of Section 152 of the Act and the Articles of Association of the Company Mr.Mohit Talwar and Mr. Arther Seter shall retire by rotation at the ensuing Annual GeneralMeeting. Being eligible they have offered themselves for re-appointment at the ensuingAnnual General Meeting. Your Directors recommend their re-appointment.

Further the tenure of Mr. Sahil Vachani as Managing Director and CEO shall end onJanuary 14 2021. Your Board of Directors recommend his appointment for a further perionof 5 years.

Brief profile of the aforesaid directors forms part of the Notice convening AnnualGeneral Meeting.

Board Meetings

The Board of Directors met 06 (Six) times during FY 2020. The details of meeting andthe attendance of directors are provided in the Corporate Governance Report which formspart of this Annual report.

Statement of Declaration by Independent Directors

In terms of Section 149(6) of the Act and Regulation 25 of the Listing Regulations theCompany has received declaration of independence from all Independent Directors namely Mr.Kummamuri Narasimha Murthy Mr. Dinesh Kumar Mittal Mr. Niten Malhan and Ms. GauriPadmanabhan.

In the opinion of the Board the Independent Directors fulfil the conditions ofindependence specified in Section 149(6) of the Act and Regulation 16(1)(b) of the ListingRegulations. The Independent Directors have also confirmed that they have complied withthe Company's Code of Conduct and the inlaid policies and applicable laws.

Key Managerial Personnel

In terms of provisions of Section 203 of the Act read with the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 Mr. Sahil Vachani - ManagingDirector and CEO Mr. Nitin Kumar Kansal - Chief Financial Officer and Mr. Saket Gupta -Company Secretary are the Key Managerial Personnel of the Company.

Committee of Board of Directors

As at March 31 2020 the Company had five committees of Board of Directors of theCompany viz. Audit Committee Nomination & Remuneration Committee Stakeholder'sRelationship Committee Corporate Social Responsibility Committee and Investment &Finance Committee which have been established as a part of the best Corporate Governancepractices and are in compliance with the requirements of the relevant provisions ofapplicable laws and statutes.

A detailed note on Board and Committees composition its terms of references and themeetings held during the year has been provided in the Corporate Governance Report whichforms part of this Annual Report.

Independent Directors' Meeting

The Independent Directors met on May 22 2019 inter-alia to:

1. Review the performance of non-independent Directors and the Board as a whole;

2. Review the performance of the Chairman of the Company taking into account the viewsof executive Directors and non-executive Directors; and

3. Assess the quality quantity and timeliness of flow of information between theCompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties.

Performance Evaluation of the Board

The performance evaluation of the Board as stipulated under the Listing Regulations andSection 134 of the Act read with Rule 8(4) of the Companies (Accounts) Rules 2014 aformal annual evaluation has been carried out for evaluating the performance of the Boardthe Committees of the Board and the Individual Directors including the IndependentDirectors and the Chairman.

The performance evaluation was carried out by obtaining feedback from all Directorsthrough a confidential online survey mechanism through Diligent Boards which is a securedelectronic medium through which the Company interfaces with its Directors. The Directorswere also provided an option to participate in physical mode. The outcome of thisperformance evaluation was placed before Nomination & Remuneration CommitteeIndependent Directors' Committee and the Board in their meetings for the consideration ofmembers.

The review concluded by affirming that the Board as a whole as well as its Chairmanall of its members individually and the Committees of the Board continued to displaycommitment to good governance by ensuring a constant improvement of processes andprocedures and contributed their best in overall growth of the organization.

Nomination & Remuneration Policy

In terms of the provisions of Section 134(3)(e) and 178 of the Act the Board ofDirectors on the recommendation of the Nomination & Remuneration Committee have put inplace a policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a Director and othermatters provided. The said Policy is available on our website athttps://www.maxvil.com/shareholder-information/.

Disclosure under Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013

The Company has requisite policy for prevention prohibition and redressal of SexualHarassment of Women at Workplace. This comprehensive policy ensures gender equality andthe right to work with dignity. The Internal Complaints Committee (ICC) is in place forredressal of complaints received relating to sexual harassment.

During FY 2020 and till the date of this report no complaint pertaining to sexualharassment was received by ICC.

Particulars of Loans Guarantees or Investments in Securities

The details of loans guarantees and investments are provided in Note No. 35 to thestandalone financial statements Forming part of this Annual Report.

Contracts or Arrangements with Related Parties

All transactions entered by the Company during FY 2020 with related parties under theAct were in the ordinary course of business and on an arm's length basis. Further yourCompany did not enter into any Related Party Transaction which may be considered materialin terms of the Listing Regulations and thus disclosure in Form AOC-2 is considered to benot applicable to the Company.

The details of all related party transactions are provided in Note No. 34 to thestandalone financial statements attached to this Report.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website athttps://www.maxvil.com/ shareholder-information/

Risk Management

Your Company considers that risk is an integral part of its business and therefore ittakes proper steps to manage all risks in a proactive and efficient manner. The Companymanagement periodically assesses risks in the internal and external environment andincorporates suitable risk treatment processes in its strategy business and operatingplans.

There are no risks which in the opinion of the Board threaten the very existence ofyour Company. However some of the challenges faced by the Company and/or its keyoperating subsidiaries have been dealt in detail in the Management Discussion and AnalysisReport forming part of this Annual Report and the Letter of Offer filed by the Companywith the Stock Exchanges at the time of rights issue. A copy of the same can be accessedat the Company's website at https://www.maxvil.com/wp-content/uploads/2018/12/Max-Ventures-and-Industries- Limited-LOF.pdf

Vigil Mechanism

The Company has a vigil mechanism pursuant to which a Whistle Blower Policy ('Policy')has been adopted and the same is hosted on the Company's website at

https://www.maxvil.com/shareholder-information/

It provides opportunity to the directors stakeholders and employees to report in goodfaith about the unethical and improper practices fraud or violation of Company's Code ofConduct. The Policy also provides for adequate safeguard against victimization of thewhistleblowers using such mechanism. The Policy also provides for direct access to theChairperson of the Audit Committee in exceptional cases.

The Company affirms that no person was denied access to the Audit Committee on mattersrelating to the Policy during FY 2020.

Human Resources

The information required under Section 197(12) of the Act read with Rule 5(1) and Rule5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended from time to time is given in 'Annexure - 4'.

Particulars of Conservation of Energy Technology Absorption & Foreign ExchangeEarning and Outgo

The information on conservation of energy technology absorption and foreign exchangeearnings & outgo as stipulated under Section 134(3) (m) of the Act read with Companies(Accounts) Rules 2014 is as follows:

a) Conservation of Energy

(i) the steps taken or impact on conservation of energy

Regular efforts are made to conserve the energy through various means such as use oflow energy consuming lightings etc.

(ii) the steps taken by the Company for using alternate sources of energy

Since your Company is not an energy intensive unit utilization of alternate source ofenergy may not be feasible.

(iii) Capital investment on energy conservation equipment:

Nil

b) Technology Absorption

Your Company is not engaged in manufacturing activities therefore there is no specificinformation to be furnished in this regard.

There was no expenditure on Research and Development during FY 2020.

c) Foreign Exchange Earnings and Outgo

The foreign exchange earnings and outgo during FY 2020 are given below:

Total Foreign Exchange earned: NIL Total Foreign Exchange used : Rs.69.40 Lakhs

Statutory Auditors and Auditors' Report

Pursuant to provisions of Section 139 and other applicable provisions if any of theAct M/s. S. R. Batliboi & Co. LLP Chartered Accountants (Firm Registration No.301003E) were appointed as Statutory Auditors of the Company at the first Annual GeneralMeeting (AGM) held on September 27 2016 to hold office till the conclusion of the fifthAGM of the Company to be held in this year.

In view of the above it is proposed to re-appoint M/s. S. R. Batliboi & Co. LLP asStatutory Auditors of the Company for a period of five years commencing from theconclusion of the ensuring AGM till the conclusion of the 10th AGM of the Company to beheld in the year 2025. The Company has received a certificate from M/s. S. R. Batliboi& Co. LLP to the effect that they are eligible for appointment as the StatutoryAuditors of the Company in accordance with the provisions of Section 141 of the CompaniesAct 2013.

The Auditors Report annexed with this Annual Report does not contain anyqualification reservation or adverse remarks.

Secretarial Auditors and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Act read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Directorsappointed M/s. Sanjay Grover & Associates Company Secretaries to undertake the

Secretarial Audit of your Company. The Report of the Secretarial Auditor has beenannexed as 'Annexure-5' to this Report which is self-explanatory.

There are no qualifications reservations adverse remarks or disclaimers given by theSecretarial Auditors in their Report for the year under review and therefore hence doesnot call for any further comments.

Internal Auditors

M/s MGC Global Risk Advisory LLP were appointed as the Internal Auditors of the Companyfor conducting the Internal Audit of key functions and assessment of Internal FinancialControls for FY 2020.

Internal Financial 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 in the design or operation effectiveness were observed.

Further the testing of such controls was also carried out independently by theStatutory Auditors for FY 2020.

In the opinion of the Board the existing internal control framework is adequate andcommensurate with the size and nature of the business of the Company.

Reporting of Frauds by Auditors

During FY 2020 neither the statutory auditors nor the internal auditors or secretarialauditors have reported to the Audit Committee under Section 143(12) of the Act anyinstances of fraud committed against the Company by its officers or employees the detailsof which are required to be mentioned in the Board's Report.

Corporate Social Responsibility Policy (CSR Policy)

In terms of the provisions of Section 135 of the Act read with Companies (CorporateSocial Responsibility Policy) Rules 2014 the Board of Directors of your Company on therecommendation of Corporate Social Responsibility Committee ("CSR Committee")approved a CSR policy which is available on the website of the Company athttps://www.maxvil.com/ shareholder-information/

The Annual Report on CSR Activities of the Company for FY 2020 is enclosed as'Annexure-6' to this Report which is self-explanatory.

Business Responsibility Report

In terms of Clause 34(2)(f) of the Listing Regulations 2013 a Business ResponsibilityReport on various initiatives taken by the Company is enclosed to this report asAnnexure - 7.

Cost Records

For FY 2020 the provisions of Section 148(1) of the Act relating to maintenance ofcost records does not apply to the Company.

Public Deposits

During FY 2020 the Company has not accepted or renewed any deposits from the public.

Secretarial Standards

During FY 2020 the Company has complied with the applicable Secretarial Standardsissued by the Institute of Company Secretaries of India.

Directors' Responsibility Statement

In terms of Section 134(3)(c) of the Act and to the best of their knowledge and beliefand according to the information and explanation provided to them your Directors herebyconfirm that:

(a) in preparation of the Financial Statements the applicable accounting standardshave been followed along with proper explanations relating to material departures if any;

(b) such accounting policies have been selected and applied consistently and judgmentsand estimates made that are reasonable and prudent so as to give a true and fair view ofthe state of affairs of the Company as on March 31 2020 and

of the profit of the Company for year ended on that date;

(c) proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for prevention and detection of fraud and other irregularities;

(d) the financial statements have been prepared on going concern basis;

(e) proper internal financial controls were in place and that financial controls wereadequate and were operating effectively; and

(f) the systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.

Unclaimed Shares

Pursuant to the provisions of Regulation 39 of the Listing Regulations the Company hastransferred the unclaimed equity shares on July 18 2017 in the Demat Account titled as'MAX VENTURES AND INDUSTRIES LIMITED- UNCLAIMED SUSPENSE ACCOUNT'. The equity sharestransferred to said Unclaimed Suspense Account belong to the members who have not claimedtheir Share Certificates pertaining to the equity shares of the Face Value of Rs. 10/-(Rupees Ten only) each.

The details of equity shares of the Company held in the Unclaimed Suspense Account havebeen provided in the Corporate Governance Report which forms part of this Annual Report.

Significant and/or material Orders passed by Regulators or the Courts

There were no significant and/or material orders passed against your Company by theregulators / courts / tribunals during FY 2020 which may impact the going concern statusand your Company's operations in future.

Statements in this Report particularly those which relate to Management Discussion andAnalysis describing the Company's objectives projections estimates and expectations mayconstitute "forward looking statements" within the meaning of applicable lawsand regulations. Actual results might differ materially from those either expressed orimplied in the statement depending on the circumstances.

Your Directors would like to place on record their sincere appreciation for thecontinued co-operation and contribution made by its management and employees towards thegrowth of the Company. Your Directors acknowledge with thanks the co-operation andassistance received from various agencies of the Central and State Governments FinancialInstitutions and Banks Shareholders and all other business associates.

On behalf of the Board of Directors

Max Ventures and Industries Limited

Date: June 05 2020 Sahil Vachani Mohit Talwar
Place: New Delhi Managing Director and CEO Vice-Chairman
DIN:00761695 DIN: 02394694

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