The Directors take pleasure in presenting the 15th Annual Report togetherwith the audited financial statements of the Company for the year ended 31stMarch 2020.
1. RESULTS OF OUR OPERATIONS AND STATE OF AFFAIRS
The Company's Financial Results for the year ended 31st March 2020 issummarized below:
Rs in Crores
| ||2019-20 ||2018-19 |
|Revenue from Operations (Net) and other income ||25.68 ||36.28 |
|Profit Before Tax (PBT) ||2.49 ||(20.56) |
|Provision for Tax ||(0.39) ||0.51 |
|Profit After Tax (PAT) ||2.10 ||(20.05) |
|Other Comprehensive Income ||0.00 ||0.07 |
|Total Comprehensive Income ||2.10 ||(19.98) |
|Balance brought forward from previous year ||11.69 ||31.67 |
|Profit available for Appropriations ||13.80 ||11.69 |
|Appropriations : || || |
|Proposed Final Equity Dividend ||-- ||-- |
|Tax on Equity Dividends ||-- ||-- |
|Transfer to General Reserve ||-- ||-- |
|Surplus carried to the next year's account ||13.80 ||11.69 |
The Standalone Financial Statements of the Company for the Financial Year Ended31.03.2020 are prepared in compliance with the applicable provisions of the Act IndianAccounting Standards (Ind- AS) and as prescribed by Securities and Exchange Board of India(SEBI) under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015(hereinafter referred to as 'the SEBI (LODR) Regulations 2015). The Financial Statementsof the Company for the year ended 31st March 2020 have been disclosed as per Division llof Schedule III to the Companies Act 2013.
Pursuant to the provisions of Section 136 of the Companies Act the FinancialStatements of the Company the Standalone Financial Statements along with all relevantdocuments and the Auditors' Report thereon form part of this Annual Report. The FinancialStatements as stated above are also available on the website of the company and can beaccessed at the web link http://www.oceanaabiotek.com/
OVERVIEW OF COMPANY'S FINANCIAL PERFORMANCE
During 2019-20 the Company achieved a turnover of Rs. 25.68 Cr. registering ade-growth of 29% over the previous year due to slowdown in the economy as such. The Profitbefore Tax was at Rs. 2.49 Cr. as against a loss of Rs. 20.56 Cr. in the previous year.The Profit after Tax was at 2.10 Cr. as against a loss of 20.05 Cr. in the previous yearregistering an impressive growth of 110%. The Company focused on reducing fixed costsworking capital and spending capital expenditure prudently on critical growth projects.
Material Changes and Commitments
Except as disclosed elsewhere in this Report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company and date of this Report.
Transfer to Reserves
The Company has not proposed to transfer any amount to the General Reserves.
Cash & Cash Equivalent
Cash and Cash Equivalent as at March 31 2020 was Rs. 0.13 Crores. The CompanyContinues to focus on judicious management of its working capital. Receivablesinventories and other working capital parameters were kept under strict check throughcontinuous monitoring.
Your Directors has not recommended any dividend for the financial year 2019-20.
We regret to inform that due to unavoidable financial constraint the Board ofDirectors at its meeting held on 22nd October 2018 decided to defer the dividend declared@ Rs. 1.50 (15% of R510) per share for the FY 2017-18 which was approved in the 13thAnnual General Meeting.
COVID-19 and its impact
Consequent to the outbreak of the COVID-19 pandemic and the lockdown/curfew introducedby the Central and State Governments the operations in the Company's manufacturing plantssituated across various locations of the Country had to be shut down or were disruptedtowards the latter half of the second fortnight of March 2020 onwards and which continuedthrough the month of April 2020.
With the easing in the lockdown/ curfew and the Governments permitting operations to beresumed with necessary permission from the local authorities the Company from end April2020 onwards has resumed operations in a partial manner in almost all the plants barringvery few which are also expected to commence operations shortly as customers start placingtheir orders. As the situation improves the Company expects to scale up operations to thefull levels over time.
As the pandemic is ongoing the Company continues to take various measures to safeguardthe health and safety of its employees and further to ensure total adherence to theguidelines issued by the Central and the respective State Governments besides the localauthorities at all its business locations.
The Company has considered the possible effects/ impact arising from COVID-19 on itsfinancial results for the year 2019-20 and at this stage it has concluded that nomaterial adjustments are required to the same. The Company will continue to closelymonitor any material changes to future economic conditions. A note in this regard isincluded in the Standalone Audited Financial Statements for the years under review videNote 32 - Significant Accounting Judgements Estimates and Assumptions forming part ofthis Annual Report for the financial year 2019-20.
2. Share Capital
The Company's paid up Equity Share Capital as on March 31st 2020 is Rs.13.56 Crore. The Company has neither issued any shares with differential rights as toDividend Voting or otherwise nor issued shares (including sweat equity shares) to theEmployees or Directors of the company under any Scheme. As on March 31 2020 none of theDirectors of the Company hold shares of convertible instruments of the Company.
No disclosure is required under Section 67(3)(c) of the Act in respect of votingrights not exercised directly by the employees of the Company as the provisions of thesaid Section are not applicable.
3. Particulars of Loans Guarantees And Investments
Particulars of loans guarantees or investments Loans guarantees and investmentscovered under Section 186 of the Companies Act 2013 form part of the Notes to thefinancial statements provided in this Annual Report.
4. Public Deposits
We have not accepted any fixed deposits including from the public and as such noamount of principal or interest was outstanding as of the Balance Sheet date.
5. Particulars of contracts or arrangements made with related parties
Particulars of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is appended as Annexure Cto the Board's report.
6. Management's Discussion And Analysis
In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Management's Discussion and Analysis isset out in this Annual Report.
7. Risk Management Report
In terms of the provisions of Section 134 of the Companies Act 2013 a Risk Managementreport forms part of the Management's Discussion and Analysis set out in this AnnualReport.
8. Board policies
The Company is compliant with the following policies/charters as mandated for alllisted Companies:
- Audit Committee Charter/Policy
- Nomination and Remuneration Policy
- Vigil Mechanism/Whistle Blower Policy
- Code of conduct for prevention of insider trading and code of practices andprocedures for fair disclosure of unpublished price sensitive information
- Policy for preservation of documents and Archival Policy
- Policy for Determination of Materiality of Any Event / Information
- Policy on Related Party Transactions
All the policies are available in the website of the Company http: / /www.oceanaabiotek.com/
9. Corporate social responsibility (CSR) initiatives:
The Company's CSR Policy has been re-stated making it more comprehensive and inalignment with the requirements of the Act when applicable. The Company is committed toCorporate Social Responsibility and strongly believes that the business objectives of theCompany must be in congruence with the legitimate development needs of the society inwhich it operates.
The company is falling under purview/ compliance of Section 135 of the Companies Act2013 as
The Company made a loss of INR 20.56 Crores in the immediately preceding Financial Year2018-19 and hence is not required to make any contribution towards Corporate SocialResponsibility pursuant to the provisions of Section 135.
Report made under clause (o) of sub-section (3) of section 134 Unspent Amount under theminimum required CSR Expenditure:
The Company should have spent at least 2% of the average net profits of the companymade during the three immediately preceding financial years. The Company unfortunately didnot get the proper platform/ assignment to spend its 2% of its average net profit of thecompany of the immediately preceding three years for CSR as per the General Circular No.01/2016 dated 12th January 2016 issued by the "Ministry of Corporate Affairs"the Company have unspent amount of Rs 664368/- in the earlier years which it intend tocarry forward to the subsequent years.
10. Human resources management
At Oceanaa Biotek we focus on the workplace of tomorrow that promotes a collaborativetransparent and participative organization culture encourages innovation and rewardsindividual contribution. The focus of human resources management at Oceanaa Biotek is toensure that we enable each and every employee to navigate the next not just for clientsbut also for themselves. We have reimagined our employee value proposition to make itmore meaningful to our employees.
The three key strategic pillars under this are :
Inspiring them to build what's next
Making sure their career never stands still
Navigating further together
Disclosure pertaining to the remuneration and other details as required under Section197(12) of the Act and the provisions contained in Rule 5(2) and Rule 5(3) of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014:
The company has not employed any person during the year
- whose remuneration was not less than Rs.10200000/- for the whole year or
- not less than Rs. 860000/- per month if employed for part of the year.
- if employed throughout the financial year or part thereof was in receipt ofremuneration in that year which in the aggregate or as the case may be at a rate whichin the aggregate is in excess of that drawn by the managing director or whole-timedirector or manager and holds by himself or along with his spouse and dependent childrennot less than two percent of the equity shares of the company.
11. Corporate governance
Our corporate governance philosophy
Our corporate governance practices are a reflection of our value system encompassingour culture policies and relationships with our stakeholders. Integrity and transparencyare key to our corporate governance practices to ensure that we gain and retain the trustof our stakeholders at all times. Corporate governance is about maximizing shareholdervalue legally ethically and sustainably. At Oceanaa Biotek our Board exercises itsfiduciary responsibilities in the widest sense of the term. Our disclosures seek to attainthe best practices in international corporate governance. We also endeavor to enhancelong-term shareholder value and respect minority rights in all our business decisions.
A separate Section on Corporate Governance practices followed by the Company togetherwith a Certificate from the Company's Auditors confirming compliance forms a part of thisAnnual Report as per SEBI (LODR) Regulations 2015
12. Meetings Board Meetings
The Board met 12 times during the financial year. The meeting details are provided inthe Corporate Governance report that forms part of this Annual Report. The maximuminterval between any two meetings did not exceed 120 days as prescribed in the CompaniesAct 2013 the details of which are given in the Corporate Governance Report.
The Audit Committee comprises Three (3) members of which three are IndependentDirectors. During the year Five (5) Audit Committee Meetings were convened and held.Details of the committee are given in the Corporate Governance Report.
The CSR Committee comprises Three (3) members of which Mr. Jesuraj IndependentDirector is the Chairman of the Committee. The Committee met once during the reportingperiod. Details of the Committee are given in the Corporate Governance Report.
13. Secretarial Standards of ICSI
Pursuant to the approval given on 10 April 2015 by the Central Government to theSecretarial Standards specified by the Institute of Company Secretaries of India theSecretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings(SS-2) came into effect from 1 July 2015. The said standards were further amended w.e.f. 1October 2017.
The Company complies with all applicable mandatory secretarial standards issued by theInstitute of Company Secretaries of India.
14. Extract of Annual Return
As required by Section 92(3) of the Act and the Rules framed there-under the extractof the Annual Return in Form MGT 9 is available on the website of the Company in thefollowing link:
http://www.oceanaabiotek.com/pdf/ Annual%20Return/ Annual%20Return%20MGT%209.pdf.
15. Details In Respect of Frauds Reported By Auditors Under Section 143(12)
During the year under review neither the statutory auditors nor the secretarialauditor has reported to the audit committee under Section 143 (12) of the Companies Act2013 any instances of fraud committed against the Company by its officers oremployees the details of which would need to be mentioned in the Board's report.
16. Internal financial control and its adequacy Internal Audit and their adequacy
The Company has in place well defined and adequate internal controls commensurate withthe size of the Company and the same were operating effectively throughout the year.
The company has an in-house Internal Audit (IA) function. The scope and authority ofthe Internal Audit function is defined in the Internal Audit Charter. To maintain itsobjectivity and independence the IA function reports to the Chairman of the AuditCommittee of the Board. The IA Department evaluates the efficacy and adequacy of InternalControl System its compliance with operating systems and policies of the Company andaccounting procedures at all locations of the company. Based on the report of IA functionprocess owners undertake corrective action in their respective areas and therebystrengthen the controls. Significant audit observations and corrective actions thereon arepresented to the Audit Committee of the Board.
Internal Controls over Financial Reporting
The Company has in place adequate internal financial controls commensurate with thesize scale and complexity of its operations. During the year such controls were testedand no reportable material weakness in the design or operations were observed. The Companyhas policies and procedures in place for ensuring for proper and efficient conduct of itsbusiness the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timely preparationof reliable financial information.
The Company has adopted Accounting Policies which are in line with the AccountingStandards and the Act. These are in accordance with generally accepted accountingprinciples in India. Changes in policies if required are made in consultation with theAuditors and are approved by the Audit Committee.
The company has a robust financial closure certification mechanism for certifyingadherence to various accounting policies accounting hygiene and accuracy of provisionsand other estimates.
17. Significant and material orders
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and the Company's operations in future.
18. Policy on directors' appointment and remuneration
The current policy is to have an appropriate mix of executive non-executive andindependent directors to maintain the independence of the Board and separate itsfunctions of governance and management. The Board of Directors consists of 4 Directors ason 31 March 2020 of whom 3 are NonExecutive Independent Directors. The policy of theCompany on directors' appointment and remuneration including the criteria for determiningqualifications positive attributes independence of a director and other matters asrequired under sub-section (3) of Section 178 of the Companies Act 2013 is available onour website
We affirm that the remuneration paid to the directors is as per the terms laid out inthe Nomination and Remuneration Policy of the Company.
19. Board Effectiveness
a. Familiarization Programme for the Independent Directors
In compliance with the requirements of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 the Company has put in place of familiarization Programmefor the Independent Directors to familiarize them with their role rights andresponsibility as Directors the working of the Company nature of the industry in whichthe company operates business model etc. The details of the familiarization Programme areexplained in the Corporate Governance Report.
b. Board Evaluation
Pursuant to the provisions of the Act and the SEBI (LODR) Regulations 2015 the Boardhas carried out the annual performance evaluation of its own performance the Directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and Compliance Committee. The criteria applied in the evaluation process areexplained in the Corporate Governance Report.
20. Directors and Key Managerial Personnel
The Board of your Company is duly constituted in accordance with the requirements ofthe Companies Act 2013 and SEBI Regulations.
Directors and KMPs resigned and appointed during the year:
1. Mrs. Pushpamadha Director has resigned on 08th May 2020.
The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he / she meets the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
There was no change in the composition of the Board of Directors and the Key ManagerialPersonnel except as stated above.
21. Directors' Remuneration Policy And Criteria For Matters Under Section 178
Information regarding Directors' Remuneration Policy and criteria for determiningqualifications positive attributes independence of a director and other matters providedunder sub-section (3) of section 178 are provided in the Corporate Governance Report.
22. Listing on stock exchanges
The Company's shares are listed on BSE Limited
23. Directors' Responsibility Statement
The financial statements are prepared in accordance with Indian Accounting Standards(Ind AS) under the historical cost convention on accrual basis except for certainfinancial instruments which are measured at fair values the provisions of the CompaniesAct 2013 (to the extent notified) and guidelines issued by SEBI. The Ind AS areprescribed under Section 133 of the Companies Act 2013 read with Rule 3 of the Companies(Indian Accounting Standards) Rules 2015 and Companies (Indian Accounting Standards)Amendment Rules 2016. Accounting policies have been consistently applied except where anewly-issued accounting standard is initially adopted or a revision to an existingaccounting standard requires a change in the accounting policy hitherto in use.
The directors confirm that:
- In preparation of the annual accounts for the financial year ended March 31 2020the applicable accounting standards have been followed and there are no materialdepartures.
- 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 at the end of the financial year and of the profitof the Company for that period.
- They have taken proper and sufficient care towards 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.
- They have prepared the annual accounts on a going concern basis.
- They have laid down internal financial controls which are adequate and are operatingeffectively.
- They have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.
24. Audit reports and auditors Audit reports
- The Auditors' Report for fiscal 2020 does not contain any qualification reservationor adverse remark. The Auditors' Report is enclosed with the financial statements in thisAnnual Report.
- The Secretarial Auditors' Report for fiscal 2020 does not contain any qualificationreservation or adverse remark. The Secretarial Auditors' Report is enclosed as Annexure Ato the Board's report in this Annual Report.
- As required by the Listing Regulations the auditors' certificate on corporategovernance is enclosed as Annexure to the Board's report. The auditors' certificate forfiscal 2020 does not contain any qualification reservation or adverse remark.
- In addition the Company has also voluntarily engaged a Practicing Company Secretaryto conduct an audit of corporate governance. The report does not contain anyqualification reservation or adverse remarks.
M/ s. Abhay Jain & Co Chartered Accountants (Firm Registration No: FRN 004636S)were
first appointed as Statutory Auditor of the Company to fill the casual vacancy createdby resignation of the earlier Auditor Ms. Elangovan & Co Chartered AccountantsChennai with effect from April 03 2019 till the conclusion of this AGM M/ s. Abhay Jain& Co Chartered Accountants (Firm registration number 000008S) was appointed as thestatutory auditors of the Company to hold office for a period of four consecutive yearsfrom the conclusion of the 14th AGM of the Company to be held 2019 till theconclusion of the 18th AGM to be held in the year 2022. The requirement for theannual ratification of auditors' appointment at the AGM has been omitted pursuant toCompanies (Amendment) Act 2017 notified on May 7 2018.
During the year the statutory auditors have confirmed that they satisfy theindependence criteria required under Companies Act 2013 Code of ethics issued byInstitute of Chartered Accountants of India.
Reply to the Statutory Auditors' qualification and remarks were given in separate sheetattached to Board's report.
As required under Section 204 of the Companies Act 2013 and Rules thereunder theBoard appointed S Satheesh Kumar Practicing Company Secretary as secretarial auditor ofthe Company for fiscal 2019-20.
The Secretarial Audit Report submitted by the Company Secretary in Practice is enclosedas a part of this Annual report in Annexure-A which is self-explanatory.
Reply to the Secretarial Auditors' qualification and remarks were given in separatesheet attached to Board's report.
Cost Records and Cost Audit
Maintenance of cost records and requirement of cost audit as prescribed under theprovisions of Section 148(1) of the Companies Act 2013 are not applicable for thebusiness activities carried out by the Company.
25. Conservation of energy research and development technology absorption foreignexchange earnings and outgo
The particulars as prescribed under sub-section (3)(m) of Section 134 of the CompaniesAct 2013 read with the Companies (Accounts) Rules 2014 are enclosed as Annexure B tothe Board's report.
26. Particulars Of Contracts Or Arrangements With Related Parties
All transactions with related parties are placed before the Audit Committee as also theBoard of approval prior omnibus approval of the Audit Committee and the Board is obtainedfor the transactions which are of a foreseen and repetitive nature. The transactionsentered into pursuant to the omnibus approval so granted are audited and a statementgiving details of all related party transactions is placed before the Audit Committee andthe Board of Directors for their approval on a quarterly basis. The statement is supportedby a Certificate from the CEO & MD. Your Company has developed a related partytransactions manual standard operating procedures for the purpose of identification andmonitoring of related party transactions.
The policy on related party transactions as approved by the board is available on theCompany's website. All transactions entered into with related parties during the year wereon an arm's length pricing basis and were in the ordinary course of business. There wereno material related party transactions i.e. transactions exceeding ten percent of theannual consolidated turnover as per the last Audited Financial Statements entered intoduring the year. Accordingly there are no transactions that are required to be reportedin form AOC 2.
None of the Directors or the Key Managerial Personnel has any pecuniary relationshipsor transactions vis-a-vis the Company.
27. Enhancing Shareholder Value
Your Company firmly believes that its success in the marketplace and a good reputationare among the primary determinants of value to the Shareholder. The organizational visionis founded on the principles of good Governance and by the resolve to be acustomer-centric organization which motivates the Company's Management to be aligned todeliver leading-edge building products backed with dependable after sales services.
Your Company is committed to creating and maximizing long-term value for Shareholdersand essentially follows a four pronged approach to achieve this end.
a) by increasing all-round operational efficiencies.
b) by identifying strategies that enhance its competitive advantage.
c) by managing risks and pursuing opportunities for profitable growth and
d) by cementing relationships with other important Stakeholder Groups throughmeaningful engagement processes and mutually rewarding associations that Enable it tocreate positive impacts on the economic societal and environmental dimensions of theTriple Bottom Line.
Underlying this is also a dedication to value-friendly financial reporting that assuresthe Shareholder and investor of receiving transparent and unfettered information on theCompany's performance.
28. Code Of Business Conduct And Ethics
The Board of Directors has approved a Code of Conduct and Ethics in terms of ScheduleIV of Companies Act 2013 and Listing Agreement. All the Board Members and the SeniorManagement personnel have confirmed compliance with the Code for the year ended March 312020. The annual report contains a declaration to this effect signed by the ManagingDirector.
29. Prevention Of Sexual Harassment Of Women At Workplace Policy
The Company's policy on Prevention of Sexual Harassment of Women provides for theprotection and prevention against sexual harassment of women employees at the workplaceand redressal of such complaints. There were no complaints received or pending forredressal during the FY 19-20.
30. Vigil Mechanism/Whistle Blower Policy:
In accordance with section 177(9) and (10) of the Companies Act 2013 and Regulation 22of SEBI (LODR) Regulations 2015 the company has established a Vigil Mechanism and has aWhistle Blower Policy. The policy provides a mechanism for all employees to report to themanagement grievances about the unethical behavior or any suspected fraud. The policy isavailable at the website of the company www.acewinagriteck.com
31. Prevention of insider trading:
The Company has complied with the provisions of SEBI (Prevention of Insider Trading)Regulations. The Company has adopted a Code of Conduct for Prevention of Insider Tradingwith a view to regulate trading in securities by the Directors and designated employees ofthe Company. The Code requires pre-clearance for dealing in the Company's shares andprohibits the purchase or sale of Company shares by the Directors and the designatedemployees while in possession of unpublished price sensitive information in relation tothe Company and during the period when the Trading Window is closed. The Board isresponsible for implementation of the Code. The code of conduct for prevention of insidertrading is available in the website of the company www.oceanaabiotek.com
32. Compliance Of Secretarial Standard
The Company has complied with the Secretarial Standards issued by The Institute ofCompany Secretaries of India and approved by the Central Government as required underSection 118(10) of the Companies Act 2013
33. Significant and material orders passed by the regulators or courts or tribunalsimpacting the going concern status of the company:
There are no significant and material orders passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
We thank our customers vendors investors bankers employee volunteers for theircontinued support during the year. We place on record our appreciation of the contributionmade by our employees at all levels. Our consistent growth was made possible by their hardwork solidarity cooperation and support.
We thank the Government of India particularly the Ministry of Labour and Employmentthe Ministry of Communications the Ministry of Electronics and Information Technologythe Ministry of Commerce and Industry the Ministry of Finance the Ministry of CorporateAffairs the Central Board of Direct Taxes the Central Board of Indirect Taxes andCustoms GST authorities the Reserve Bank of India Securities and Exchange Board ofIndia (SEBI) various departments under the state governments and union territories andother government agencies for their support and look forward to their continued supportin the future.
| ||By Order of the Board |
| ||Thomas Xavier Jeyaraj |
|Date: December 08 2020 ||Managing Director |
|Place: Chennai ||DIN: 06896574 |