Your Directors are pleased to present the 48th Annual Report on business andoperations of Oriental Aromatics Limited ("the Company") along with the AuditedFinancial Statements (Standalone and Consolidated) for the financial year ("FY")ended 31st March 2020 and the Report of the Auditors thereon.
1. FINANCIAL HIGHLIGHTS:
The Financial performance of the Company for the year ended 31st March 2020on a Standalone and Consolidated basis is summarized below:
| || |
|Particulars ||2019-2020 ||2018-2019 ||2019-2020 ||2018-2019 |
|Revenue from Operation ||75943.01 ||75255.35 ||75989.45 ||75468.57 |
|Other Income ||702.36 ||127.19 ||737.24 ||127.25 |
|Profit before exceptional items depreciation and finance costs ||13447.47 ||11665.71 ||13384.15 ||11627.47 |
|Less : Depreciation and amortisation expense ||1901.86 ||1771.49 ||1901.86 ||1779.71 |
|Profit before finance costs ||11545.61 ||9894.22 ||11482.29 ||9847.76 |
|Less: Finance costs ||1195.26 ||1297.00 ||1192.46 ||1298.58 |
|Profit before exceptional items and tax expenses || |
|10289.83 ||8549.18 |
|Less: Exceptional Items ||- ||1007.57 ||- ||232.23 |
|Profit before tax ||10350.35 ||7589.65 ||10289.83 ||8316.95 |
|Less : Tax expense ||1674.88 ||2601.78 ||1670.95 ||2602.63 |
|Profit for the year ||8675.47 ||4987.87 ||8618.88 ||5714.32 |
|Attributable to : || || || || |
|Equity shareholders of the Company ||8675.47 ||4987.87 ||8618.88 ||5714.32 |
|Other comprehensive income ('OCI') Income/(Loss) ||(74.14) ||(46.48) ||(74.14) ||(46.48) |
|Total comprehensive income ||8601.33 ||4941.39 ||8544.74 ||5667.84 |
|Balance in retained earnings at the beginning of the year ||33060.70 ||28276.01 ||33514.21 ||27545.19 |
|Add: Profit for the year (attributable to equity shareholders of the Company) ||8675.47 ||4987.87 ||8618.88 ||5714.32 |
|Add: Transfer to Items other comprehensive income ||- ||- ||- ||97.88 |
|Less: Dividends including tax on dividend ||1420 ||203.18 ||1420 ||203.18 |
|Balance in retained earnings at the end of the year ||40316.17 ||33060.70 ||40353.09 ||33154.21 |
2. OPERATIONAL PERFORMANCE/STATE OF COMPANY'S AFFAIRS:
a. Standalone Performance:
During the year under review the revenue from operations of your Company stood atRs.75943.01 Lakh as against Rs.75255.35 lakh for the previous year showing a marginalincrease of 0.91%.
The Company earned a Profit after tax of Rs.8675.47 Lakh as against Rs.4987.87 lakhfor the previous year thereby registering a growth of 74%.
The Company managed to register the aforesaid growth mainly due to better salesrealization higher volumes in speciality aroma chemicals reduction in raw materialprices and also operational efficiency brought about through better and optimumutilization of resources and proper implementation of business policies plans andstrategies. Despite reduction in the raw material prices the company was able to hold onthe selling prices which improved the margins.
Due to increase in the profit the Earning per share (EPS) increased from Rs.14.82 inthe previous year to Rs.25.78 in the year under review.
The net worth of your Company increased to '41616.03 Lakh at the end of the FY 2020from Rs.34434.69 lakh at the end of FY 2019 thereby registering a growth of 20.85%.
Your Company performed well during the year by efficiently managing the resourceswhich resulted into improved performance and increase in profit and EPS.
b. Consolidated Performance:
The consolidated total sales of your Company for the FY 2019-20 stood at Rs.75989.45lakh as against Rs.75468.57 lakh showing a marginal increase of 0.69%
The Company earned a Consolidated Profit after tax of Rs.8618.88 lakh as againstRs.5714.32 lakh for the previous year thereby registering a growth of 50.83%.
As a result of increase in the consolidated profit the Earning per share (EPS) alsoincreased from Rs.16.98 in the previous year to Rs.25.61 in the year under review.
The Consolidated net worth of your Company increased to Rs.41649.53 lakh at the end ofthe FY 2019-20 from Rs.34427.96 lakh at the end of FY 2018-19 thereby registering agrowth of 20.97%
Your Company continues to focus on value maximization and bringing greater efficiencyin overall business including economies of scale and cash flow management.
c. Business Impact Of COVID-19:
In the last month of FY 2020 unfortunately the COVID-19 pandemic developed rapidlyinto a global crisis forcing governments to enforce lock-downs of all economic activity.The Company had suspended operations at all its offices and manufacturing locations inIndia with effect from 23rd March 2020 to ensure the safety of its employeesand their families and to contain the spread of Coronavirus (COVID-19). In view of thesame initially the operations faced disruptions at its manufacturing facilities howeverthe Company was able to resume operations soon due to the increasing demand for essentialservices. The Company resumed operations at all its manufacturing facilities in a phasedmanner with permission from the local administration to begin work. It put in placecomprehensive protocols on social distancing in all its plants ensuring the safety healthand well-being of its employees.
Company's Registered/corporate office at Mumbai has been under lockdown since 23rdMarch 2020 however company has set up infrastructure and systems for smooth operationsfor personnel working from home with a primary objective of ensuring the health andwell-being of its employees. The Company has been proactive to tackle the challenges thathave emerged due to the COVID-19 pandemic.
Your Company remains committed to the fight against the pandemic and is catering to theneeds of "essential services" and it continues to take all necessary steps inprotecting the interests of its customers suppliers and most importantly its entire teamthat is working tirelessly to make sure that all the businesses stay operational duringthese difficult times. During the FY 2019-20 the Company evolved to be stronger despitethe world being hit by a global pandemic.
The Company's focus on value maximization supported by optimal use of itsmanufacturing facilities its expansion plans and an efficient team would help innavigating any challenges in the current environment and after math of COVID-19 pandemic.Your Directors believe that Company's efforts towards being better every day will drivelasting value for all our stakeholders and usher in a stronger tomorrow for everyone.
However due to the nature of the pandemic its uncertain to predict the impact ofCOVID-19 in the near future.
Your Directors had based on Company's performance declared an Interim Dividend ofRs.2.5/- per share (50%) on the Paid up Equity shares of face value of Rs.5/- each of theCompany amounting to Rs.84133940/- (Rupees Eight Crore Forty-One Lakh Thirty- ThreeThousand Nine Hundred and Forty only) for the FY 2019-2020 to those members whose namesappeared on the Register of Members of the Company on the 20th March 2020being the Record date for payment of Interim Dividend.
Your Directors after considering various external factors in correlation to impact ofunprecedented COVID-19 pandemic as well as internal factors such as the long-term growthstrategy of the Company and the liquidity position including working capital requirementshave deemed it prudent not to recommend any final dividend on equity shares for the yearended 31st March 2020.
4. TRANSFER TO RESERVES:
Your Directors do not propose to transfer any amount to reserves for the FY ended 31stMarch 2020.
5. SHARE CAPITAL:
a. Authorized Capital
The Authorized share capital of the Company as on 31st March 2020 stood atRs.350000000/- (Rupees Thirty Five Crore only) comprising of 70000000 Equity sharesof Rs.5/- each.
b. Paid Up Capital
The paid up Capital of the Company as on 31st March 2020 stood atRs.168267880/- (Rupees Sixteen Crore Eighty-Two Lakh Sixty-Seven Thousand Eight Hundredand Eighty only) comprising of 33653576 shares of Rs.5/- each.
6. DEPOSITS COVERED UNDER CHAPTER V OF THE COMPANIES ACT 2013:
During the year under review your Company has not accepted any Deposits within themeaning of Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014.
7. FINANCE AND ACCOUNTS:
As mandated by the Ministry of Corporate Affairs the financial statements for the yearended on March 31 2020 have been prepared in accordance with the Indian AccountingStandards (Ind AS) notified under Section 133 of the Companies Act 2013 (hereinafterreferred to as "The Act") read with the Companies (Accounts) Rules 2014 asamended from time to time. The estimates and judgements relating to the FinancialStatements are made on a prudent basis so as to reflect in a true and fair manner theform and substance of transactions and reasonably present the Company's state of affairsprofits and cash flows for the year ended 31st March 2020. The Notes to theFinancial Statements adequately cover the standalone and consolidated Audited Statementsand form an integral part of this Report.
8. SECRETARIAL STANDARDS:
Your Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto Rs.Meetings of the Board of Directors' and 'General Meetings' respectively have beenduly followed by the Company.
9. BUSINESS RESPONSIBILITY REPORT:
A detailed report on the initiatives taken by the Company is provided in the businessresponsibility report a copy of which is available on the Company's websitewww.orientalaromatics.com. For Business Responsibility Report as stipulated underRegulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 (SEBI Listing Regulations) kindly refer Business Responsibility Report sectionwhich forms part of this Annual Report.
10. MATERIAL CHANGES AND COMMITMENTS:
Following material changes and commitments affecting the financial position of theCompany have occurred between the end of the financial year of the Company to which thisreport relates and the date of the report:
Change in Directorate:
Mr. Animesh Dhar Executive Director-Operations (DIN: 07905777) of the Company steppeddown from the post of directorship on 21st July 2020 due to personal reasons.The Board in its meeting held on 10th August 2020 took note of the same andplaced on record its appreciation for the contributions made by him during his tenure as adirector.
Mr. Bhadreshkumar A. Pandiya (DIN: 08809906) was appointed as Additional Director inthe Board meeting held on 10th August 2020 to hold office upto the date ofensuing 48thAnnual General Meeting. Directors recommend his appointment as theWhole Time Director designated as 'Executive director-Operations' of the Company for aperiod of five years to the members in the 48th Annual General Meeting.
11. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant and material orders passed by the Regulators/courts that wouldimpact the going concern status of the Company and its future operations.
12. CONSOLIDATED FINANCIAL STATEMENTS :
As stipulated under the provisions of the Companies Act 2013 and SEBI ListingRegulations the Consolidated Financial Statements have been prepared by the Company inaccordance with the applicable Accounting Standards issued by Institute of CharteredAccountants of India (ICAI). The Audited Consolidated Financial Statement together withAuditors' Report forms part of the Annual Report.
13. PERFORMANCE HIGHLIGHTS OF SUBSIDIARIES:
a. PT Oriental Aromatics (Indonesia)
Your Company has only one overseas subsidiary namely PT Oriental Aromatics in Indonesiawhich is engaged in the business of flavors and fragrances.During the FY 2019-20 itrecorded a total loss of Rs.15.59 lakh due to closing of operations in the Company.
There are no associate companies within the meaning of section 2(6) of the Act.
Pursuant to the provisions of Section 129 (3) of the Act a statement containing thesalient features of financial statements of the Company's subsidiaries in Form AOC-1 isattached as "Annexure A"- to the Board's Report.
b. Oriental Aromatics & Sons Limited
Oriental Aromatics & Sons Limited was incorporated as wholly owned subsidiary ofOriental Aromatics on 27th December 2019 which is engaged in the business ofSpeciality Aroma Chemicals flavors and fragrances. During FY 2019-20 it recorded a totalloss of Rs.21.24 lakh.
The Company has not yet commenced its operations. The Loss as stated above pertains topreliminary expenses.
Pursuant to the provisions of Section 129 (3) of the Act a statement containing thesalient features of financial statements of the Company's subsidiaries in Form AOC-1 isattached as "Annexure A"- to the Board's Report.
14. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
Internal control review assumes greater importance in the light of current economicdownturn. Your Company has maintained a proper and adequate system of internal controls.Monitoring and assessment of internal controls across various functions is performedthrough continuous evaluations to ensure that the implemented internal control system iseffective. To maintain its objectivity and independence the Internal Auditor reports tothe Chairman of the Audit Committee of the Board.
The Internal Auditor monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalauditor corrective actions are undertaken in the respective areas and therebystrengthening the controls. Significant audit observations and corrective actions thereonare presented to the Audit Committee of the Board.
15. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
No loans or guarantees were given and no securities were provided by the Companyexcept investments were made in Wholly owned subsidiary (WOS) Company during the year forwhich Section 186 of the Act is not applicable. Further the details of investments in WOSare given in Notes to the Financial Statements forming part of Annual Report.
16. RELATED PARTY TRANSACTIONS:
All Related Party Transactions that were entered into during the FY 2019-20 were onarm's length basis and in the ordinary course of business.
All transactions entered into with the Related Parties as defined under the CompaniesAct 2013 and Regulation 23 of the SEBI Listing Regulations during the financial yearunder review were on arm's length basis and thus a disclosure in Form AOC-2 in terms ofSection 134 of the Act is not required. Further there are no material related partytransactions during the year under review. Related party transactions have been disclosedunder significant accounting policies and notes forming part of the Financial Statementsin accordance with "IND AS".
As required under Regulation 23(1) of the SEBI Listing Regulations the Company hasformulated a policy on dealing with Related Party Transactions. The policy on dealing withRelated Party Transactions as approved by the Board is uploaded on the Company's website www.orientalaromatics.comand the weblink thereto is: http://www.orientalaromatics.com/documents/corporate-governance/policies/policy-on-related-party-transactions.pdf
17. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
The Board comprises of 8 (eight) directors out of which 4(four) are independentdirectors.
In terms of Section 152 of the Companies Act 2013 and the Articles of Association ofthe Company Mr. Shyamal A. Bodani (DIN:00617950) Executive Director of the Companyretires by rotation at the ensuing Annual General Meeting and being eligible offershimself for re-appointment.
The proposal regarding the re-appointment of the aforesaid Director is placed for yourapproval. The Board of Directors recommends his re-appointment.
The Board of Directors at its meeting held on 10th August 2020 upon therecommendation of the Nomination and Remuneration Committee has appointed Mr.Bhadreshkumar A. Pandiya (DIN: 08809906) as an Additional Director on the Board of theCompany. Being eligible and offering himself for appointment the Board of Directorsrecommends his appointment as the Whole Time Director designated as 'Executivedirector-Operations' of the Company for a period of five years with effect from 10thAugust 2020 to the members in the 48th Annual General Meeting.
As required under the SEBI Listing Regulations particulars of Directors seekingappointment/re-appointment at the ensuing General Meeting have been given under CorporateGovernance Report and in the Notice of the 48th Annual General Meeting.
None of the Directors are disqualified from being appointed as Directors as specifiedin Section 164 of the Companies Act 2013.
c. DECLARATION BY INDEPENDENT DIRECTORS:
All the Independent Directors of Company have given the declarations that they meet thecriteria of Independence as prescribed pursuant to the provisions of Section 149(6) of theCompanies Act 2013 and Regulation 16(1) (b) of SEBI Listing Regulations as amended fromtime to time and are independent of the management.
d. NUMBER OF MEETINGS OF THE BOARD:
During the year six (6) Board Meetings were convened and held. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013 andSEBI Listing Regulations. Detailed information on the meetings of the Board and Committeesare included in the Corporate Governance Report which forms part of this Annual Report.
e. FAMILARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Company has set Familiarisation programme for Independent Directors with regard totheir roles rights responsibilities in the Company nature of the industry in which theCompany operates the business model of the Company etc. The details of which areavailable on the website of the Company. www.orientalaromatics.com. The Weblink ofthe same is as below: http://www.orientalaromatics.com/documents/corporate-governance/policies/familiarization-program.pdf
For details of the Familiarisation programme conducted kindly refer CorporateGovernance Report which forms part of this Board's Report
f. BOARD EVALUATION:
In terms of the provisions of the Companies Act 2013 and SEBI Listing Regulations astructured questionnaire was prepared after taking into consideration the various aspectsof the Board functioning like composition of the Board and its committees cultureexecution and performance of Specific duties obligations and governance.
The board carried out an annual performance evaluation of its own performance theindependent directors as well as the working of the committees of the board. Evaluation ofall the directors was carried out by chairman of the Nomination and Remuneration committeemeeting in consultation with all the members of Nomination and Remuneration committee. Theperformance evaluation of board and committees was evaluated by the board after seekingall inputs from all the directors on the basis of criteria such as composition structureeffectiveness and functioning of the Board and its respective committees.
The performance evaluation of the independent directors was carried out by the entireboard excluding the independent director being evaluated.
I n the separate meeting of independent directors performance evaluation of thechairperson and the non-independent directors and board as a whole was carried out takinginto account views of executive and non-executive directors. The overall performance ofchairman Executive directors Non-executive directors Board and Committees of the Boardwas found satisfactory.
g. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Change in Directorate and KMP:
There was no change in the Composition of Board of Directors during the FY 2019-20.
Mr. Harshvardhan A. Piramal (DIN: 00044972) Mr. Prakash V Mehta (DIN: 00001366) andMr. Ranjit A. Puranik (DIN: 00199353) were re-appointed as Independent Directors at theforty-seventh Annual General Meeting (AGM) held on 25th September 2019 to holdoffice for second term of five consecutive years with effect from 25thSeptember 2019 to 24th September 2024.
Further Mr. Parag Satoskar was appointed as Chief Executive Officer and Key ManagerialPersonnel with effect from 27th May 2019.
Pursuant to the provisions of Section 203 of the Act the KMP of the Company as on 31stMarch 2020 were as follows:
Mr. Dharmil A. Bodani - Chairman and Managing Director
Mr. Shyamal A Bodani -Executive director
Mr. Animesh Dhar - Executive Director- Operations
Mr. Satish Kumar Ray-Executive Director-Operations
Mr. Parag K. Satoskar - Chief Executive Officer
Mr. Girish Khandelwal - Chief FinancialOfficer
Ms. Kiranpreet Gill -Company Secretary and Compliance Officer
18. CORPORATE GOVERNANCE
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 Listing Regulations.
19. MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report as required under the provisions of SEBIListing Regulations forms part of this Annual Report.
20. DIRECTOR'S RESPONSIBILITY STATEMENT:-
Pursuant to the requirements under Section 134 (3) (c) of the Companies Act 2013 yourDirectors hereby state and confirm that:
a. In the preparation of the annual accounts the applicable accounting standardshave been followed and there have been no material departures.
b. Such accounting policies have been selected and applied consistently andjudgments and estimates have been made that are reasonable and prudent to give a true andfair view of the Company's state of affairs as at 31st March 2020 and of theCompany's profit for the 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 Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.
d. The annual financial statements have been prepared on a going concern basis.
e. That internal financial controls were laid down to be followed and that suchinternal financial controls were adequate and were operating effectively.
f. Proper systems were devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
21. DISCLOSURES RELATED TO POLICIES:
a. CORPORATE SOCIAL RESPONSIBILITY (CSR):
Pursuant to Section 135 of the Companies Act 2013 and the Rules made there under theBoard of Directors has constituted the Corporate Social Responsibility (CSR) Committeeunder the Chairmanship of Mr. Shyamal A .Bodani Executive Director (DIN:00617950). TheCompany undertakes CSR activities in accordance with the said Policy. The Company hasadopted a strategy for undertaking CSR activities either directly or through Keshavlal V.Bodani Education Foundation as deemed appropriate and is committed to allocating atleast 2% of average net profit of the last 3 years.
The Company has identified and adopted projects as per the activities included andamended from time to time in Schedule VII of the Companies Act 2013. Accordingly theCompany focuses on areas towards promoting educational facilities for the students havinglearning disabilities by making contribution to Keshavlal V.Bodani Education Foundation.
This year in addition to making contribution to Keshavlal V.Bodani EducationFoundation your Company has also made contribution to IIT Gandhinagar situated at Barodatowards the Promotion of educational facilities as well as to the PM Care Relief Fund aspart of its CSR to contain the spread of Coronavirus pandemic.
The Corporate Social Responsibility Policy is available on the website of the Company www.orientalaromatics.comand the web-link thereto is as below:http://www.orientalaromatics.com/documents/corporate-governance/policies/csr-policy.pdf
During the FY 2019-20 the Company has spent the amount of Rs.120 Lakh towards the CSRinitiatives. The disclosure relating to the amount spent and the details of the activitiesas required under Companies (Corporate Social Responsibility Policy) Rules 2014 isprovided in "Annexure-B" forming part of this report.
b. NOMINATION AND REMUNERATION POLICY:
In terms of the provisions of the Companies Act 2013 and the SEBI Listing Regulationsas amended from time to time the policy on nomination and remuneration of Directors KeyManagerial Personnel and Senior Management has been formulated by the Committee andapproved by the Board by Directors.
The objective of the Policy is:
i. to lay down criteria and terms and conditions with regard to identifying persons whoare qualified to become Directors (Executive/Non-Executive/Independent) and persons whomay be appointed in Senior Management and Key Managerial positions and to determine theirremuneration
ii. to specify the manner for effective evaluation of performance of Board itscommittees and individual directors to be carried out either by the Board by theNomination and Remuneration Committee or by an independent external agency and review itsimplementation and compliance.
iii. to recommend to the Board appointment and removal of Director KMP and SeniorManagement Personnel.
iv. to assist the Board in ensuring that the Board nomination process is in line withthe diversity policy of the Board relating to gender thought experience knowledge andperspectives. The Nomination and Remuneration Policy was reviewed and revised by the Boardon 29th June 2020 to ensure its continued relevance and to make anyamendments consequent to changes in applicable law. The remuneration has been paid as perthe Nomination and Remuneration Policy of the Company. The policy may be accessed on thewebsite of the Company at www.orientalaromatics.com and weblink thereto is:http://www.orientalaromatics.com/documents/corporate-povernance/policies/NomNRemPol.pdf
c. VIGIL MECHANISM/WHISTLE BLOWER POLICY:
The Company has a vigil mechanism / Whistle Blower Policy to deal with instance offraud and mismanagement if any. The objective of the Policy is to explain and encouragethe directors and employees to report genuine concerns or grievances about unethicalbehavior actual or suspected fraud or violation of the company's Code of Conduct orEthics Policy.
The Vigil Mechanism may be accessed on the Company's website at www.orientalaromatics.comat the link: http://www.orientalaromatics.com/documents/corporate-governance/policies/vigil-mechanism.pdf
d. MATERIAL SUBSIDIARY POLICY:
Pursuant to the provisions of Regulation 16(1)(c) of the SEBI Listing Regulations theCompany has adopted a Policy for determining Material Subsidiaries laying down thecriteria for identifying material subsidiaries of the Company.
The Company does not have any Material subsidiary.
The Policy may be accessed on the website of the Company at the link: http://www.orientalaromatics.com/documents/corporategovernance/policies/POLMatSubsidiary.pdf
e. RISK MANAGEMENT:
Pursuant to the requirement of Section 134 of the Companies Act 2013 the Company hasalready in place a Risk Management Plan.
The Company has a robust Business Risk Management framework to identify and evaluatebusiness risks and opportunities. This framework seeks to create transparency minimizeadverse impact on the business objectives and enhance your Company's competitiveadvantage.
The business risk framework defines the risk management approach across the enterpriseat various levels including documentation and reporting. The framework has different riskmodels which help in identifying risks trend exposure and potential impact analysis at aCompany level. The Company has adopted risk management policy.
22. AUDITORS AND AUDITORS REPORTS:
a. STATUTORY AUDITORS:
At the Company's 46th Annual General Meeting held on 24thSeptember 2018 M/s Bagaria & Co LLP (Reg. No. 113447W/W- 100019) CharteredAccountants were appointed as statutory Auditors of the Company for a period of 5 yearstill the conclusion of 51st Annual General Meeting.
The Auditors Report to the shareholders for the year under review does not contain anyqualification reservation disclaimers or adverse remarks.
b. SECRETARIAL AUDITOR:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed M/s. Shreyans Jain & Co. Practicing Company Secretaries to undertake theSecretarial Audit of the Company for the FY 2019-20. The Report of the Secretarial Auditcarried out is annexed herewith as "Annexure C".
The Secretarial Audit report as issued by the auditors in Form MR-3 does not containany observation or qualification requiring explanation or comments from the Board underSection 134(3) of the Companies Act 2013.
The Board has on the recommendation of the Audit Committee re-appointed M/s. ShreyansJain & Co. Practicing Company Secretaries as Secretarial Auditor for conductingSecretarial Audit of the Company for the FY 2020-21.
c. COST AUDITOR:
Pursuant to the provisions of Section 148(2) of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Amendment Rules 2014 the Board had appointed M/s V.J. Talati & Co Cost Accountants as cost auditors to conduct the audit of Costaccounting records for the FY 2019-20
The Cost Audit report for the FY 2018-19 was filed with Ministry of Corporate Affairson 06th September 2019.
The Board has on the recommendation of the Audit Committee re-appointed M/s V. J.Talati & Co. Cost Accountants to conduct the audit of the cost accounting records ofthe Company for FY 2020-21 at a remuneration of Rs.145000/- (Rupees One Lakh Forty-FiveThousand only) plus Service Tax & re-imbursement of out-of- pocket expenses. Theremuneration is subject to the ratification of the Members in terms of Section 148 readwith Rule 14 of the Companies (Audit and Auditors) Rules 2014 and is accordingly placedfor your ratification.
23. REPORTING OF FRAUDS
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and / or Board under Section 143(12)of the Act and Rules framed thereunder.
24. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF):
Since the Company had not declared any dividend for the FY 2011-12 in view of thesame no shares and dividend was transferred during the FY 2019-20 pursuant to section124(6) of the Companies Act 2013 read with Investor Education and Protection FundAuthority (Accounting Audit Transfer and Refund) Rules 2016.
The Company's buildings plant & machinery and inventories have been adequatelyinsured. Loss of profit with respect to both factories has also been adequately insured.
26. ENVIRONMENTAL COMPLIANCE AND SAFETY:
Your Company gives great importance to pollution control and environment protection andefforts are made at each stage of manufacture to maximize recovery conserve water and tominimize effluents and emissions. As required by the local authorities the Company submitsnecessary analytical reports. Environment Audit is conducted on regular basis and reportsare submitted to the concerned authorities.
27. LISTING OF SECURITIES:
Your Directors are pleased to inform that the equity shares of the company got listedand admitted to dealings on the National Stock Exchange of India Ltd (NSE) w.e.f 11thof July 2019. Thus the Equity Shares stand listed at BSE Limited (BSE) and NSE. TheShares are under compulsory dematerialization list of the Securities & Exchange Boardof India. As on 31st March 2020 total 32497848 shares representing 96.57%of Companies Equity Share Capital have been dematerialized. The Company has paid AnnualListing fees for the FY 2020-21 to the stock exchanges where it is listed.
28. INDUSTRIAL RELATIONS:
The relations with the employees of the Company remained peaceful and cordial duringthe year under review.
29. EXTRACT OF ANNUAL RETURN:
Pursuant to the provisions of Section 134(3) (a) of the Companies Act 2013 Extract ofthe Annual Return for the FY ended 31st March 2020 made under the provisions ofSection 92(3) of the act in Form MGT 9 is attached as "Annexure-D" whichforms part of this report.
30. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS ANDOUTGO:
As required by the Companies (Accounts) Rules 2014 the relevant informationpertaining to conservation of energy technology absorption foreign exchange earnings andoutgoings respectively is given in the "Annexure- E" to this report.
31. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
In terms of provisions of Section 197(12) of the Companies Act 2013 read with Rules5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 there were no employees except Mr. Dharmil A. Bodani Chairman and ManagingDirector and Mr. Shyamal A. Bodani Executive Director of the Company drawingremuneration more than Rs.1.02 crore per annum or Rs.8.5 lakh per month during the yearunder review.
Mr. Dharmil A. Bodani aged 50 years and Mr. Shyamal A. Bodani aged 39 years are boththe promoters and withdraw a remuneration of Rs.2.01 crore and Rs.1.09 crore respectivelyduring the year under review. The appointment of Mr. Dharmil A. Bodani and Mr. Shyamal A.Bodani is contractual as approved by the Board and members of the Company.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) Rules 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 is attached herewith as "Annexure-F".
32. INFORMATION UNDER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
Your Directors state that during the year under review there were no cases filedpursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
33. GREEN INITIATIVE:
Your Company has considered and adopted the initiative of going green minimizing theimpact on the environment. To support the company's 'Green Initiative' members who havenot yet registered their email addresses are requested to register the same with their DPsin case the shares are held by them in electronic form and with our Registrar and ShareTransfer Agent- M/s Sharex Dynamic Pvt Ltd (RTA) in case the shares are held by them inphysical form. Your Company appeals other Members also to register themselves forreceiving Annual Report/documents in electronic form.
Your Directors wish to express their sincere appreciation and are thankful to theCompany's customers vendors and investors for their continuous confidence and patronage.The Director's also thank the employees of the Company for the valuable services renderedand the commitment displayed as well as to the financial institutions and businessassociates regulatory and governmental authorities for their co-operation support andguidance.
| || |
For and on behalf of the Board of Directors
| ||Dharmil A. Bodani ||Shyamal A. Bodani |
| ||Chairman and Managing Director ||Executive Director |
| ||DIN: 00618333 ||DIN: 00617950 |
|Place: Mumbai Date: 10th August 2020 || || |