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Oriental Aromatics Ltd.

BSE: 500078 Sector: Industrials
NSE: OAL ISIN Code: INE959C01023
BSE 00:00 | 21 Jan 741.90 -12.25
(-1.62%)
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768.05

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NSE 00:00 | 21 Jan 739.45 -13.95
(-1.85%)
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760.00

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770.00

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OPEN 722.05
PREVIOUS CLOSE 754.15
VOLUME 3190
52-Week high 1148.00
52-Week low 545.00
P/E 26.84
Mkt Cap.(Rs cr) 2,497
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 722.05
CLOSE 754.15
VOLUME 3190
52-Week high 1148.00
52-Week low 545.00
P/E 26.84
Mkt Cap.(Rs cr) 2,497
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Oriental Aromatics Ltd. (OAL) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the 49th Annual Report on business and operationsof Oriental Aromatics Limited ("the Company") along with the Audited FinancialStatements (Standalone and Consolidated) for the financial year ("FY") ended31st March 2021 and the report of the Auditors thereon.

1. FINANCIAL HIGHLIGHTS:

The Financial performance of the Company for the year ended 31st March 2021 on aStandalone and Consolidated basis is summarized below:

(Rs in Lakh)

Particulars

Standalone

Consolidated

2020-2021 2019-2020 2020-2021 2019-2020
Revenue from Operations 70883.55 75943.01 70883.55 75989.45
Other Income 175.69 628.23 165.41 663.11
Profit before exceptional items depreciation and finance costs 15731.14 13447.48 15672.80 13384.16
Less : Depreciation and amortisation expense 1745.93 1901.86 1745.93 1901.86
Profit before finance costs 13985.21 11545.62 13926.87 11482.30
Less: Finance costs 240.08 1195.26 231.05 1192.46
Profit before exceptional items and tax expenses 13745.13 10350.35 13695.82 10289.84
Less: Exceptional Items - -
Profit before tax 13745.13 10350.35 13695.82 10289.84
Less : Tax expense 3502.48 1674.88 3502.06 1670.95
Profit for the year 10242.65 8675.47 10193.76 8618.88
Attributable to :
Equity shareholders of the Company 10242.65 8675.47 10193.76 8618.88
Other comprehensive income ('OCI') Income/(Loss) (35.58) (74.14) (35.58) (74.14)
Total comprehensive income 10207.07 8601.33 10158.17 8544.74
Balance in retained earnings at the beginning of the year 40316.16 33060.70 40353.09 33514.21
Add: Profit for the year (attributable to equity shareholders of the 10242.65 8675.47 10193.76 8618.88
Company)
Add: Transfer to Items other comprehensive income - -
Less: Dividends including tax on dividend 841.47 1420 841.47 1420
Balance in retained earnings at the end of the year 49717.34 40316.17 49705.38 40353.09

2. OPERATIONAL PERFORMANCE/STATE OF COMPANY'S AFFAIRS:

a. Standalone Performance:

During the year under review the revenue from operations of your Company stood at Rs70883.55 Lakh as against Rs 75943.01 lakh for the previous year showing a marginaldecrease of 6.66 %.

The Company earned a Profit after tax of Rs 10242.65 Lakh as against Rs 8675.47 lakhfor the previous year thereby registering a growth of 18.06 %.

The Company managed to register the aforesaid growth mainly due to better salesrealization higher volumes in specialty aroma chemicals reduction in raw material pricesand also operational efficiency brought about through better and optimum utilization ofresources and proper implementation of business policies plans and strategies.

Due to increase in the profit the Earning per share (EPS) increased from ^ 25.78 inthe previous year to ^ 30.44 in the year under review.

The net worth of your Company increased to Rs 50981.62 Lakh at the end of the FY 2021from Rs 41616.03 lakh at the end of FY 2020 thereby registering a growth of 22.50%.

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 2020-21 stood at Rs 70883.55lakh as against Rs 75989.45 lakh showing a marginal decrease of 6.72 %

The Company earned a Consolidated Profit after tax of Rs 10193.76 lakh as against Rs8618.88 lakh for the previous year thereby registering a growth of 18.27 %.

As a result of increase in the consolidated profit the Earning per share (EPS) alsoincreased from ^ 25.61 in the previous year to ^ 30.29 in the year under review.

The Consolidated net worth of your Company increased to Rs 50964.21 lakh at the end ofthe FY 2020-21 from Rs 41649.53 lakh at the end of FY 2019-20 thereby registering agrowth of 22.36%

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 early 2020 the coronavirus pandemic (COVID-19) struck countries around the worldpresenting enormous challenges to health systems and spurring widespread shutdowns of alleconomic activity. Since the pandemic have unfortunately continued during the current yearas well the Company has continued work from home facility and have set up infrastructureand systems for smooth operations for personnel working from home with the primaryobjective to ensure the safety of its employees and their families and to contain thespread of Coronavirus (COVID-19). The Company also ensures protocols on social distancingin all its plants ensuring the safety health and well-being of its employees.

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 2020-21 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 aftermath of COVID-19 pandemic.

3. DIVIDEND:

Your Directors had based on Company's performance declared an Interim Dividend ofRs2.5/- per share (50%) on the Paid up Equity shares of face value of Rs 5/- each of theCompany amounting to ^84133940/- (Rupees Eight Crore Forty-One Lakh Thirty-ThreeThousand Nine Hundred and Forty only) for the FY 2020-21 to those members whose namesappeared on the Register of Members of the Company on the 04th December 2020 being theRecord date for payment of Interim Dividend.

Your Directors after considering various external and internal factors have deemed itprudent not to recommend any final dividend on equity shares for the year ended 31stMarch 2021.

4. TRANSFER TO RESERVES:

Your Directors do not propose to transfer any amount to reserves for the FY ended 31stMarch 2021.

5. SHARE CAPITAL:

a. Authorized Capital

The Authorized share capital of the Company as on 31st March 2021 stood at Rs350000000/- (Rupees Thirty Five Crore only) comprising of 70000000 Equity shares ofRs 5/- each.

b. Paid Up Capital

The paid up Capital of the Company as on 31st March 2021 stood at Rs 168267880/-(Rupees Sixteen Crore Eighty- Two Lakh Sixty-Seven Thousand Eight Hundred and 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 31st March 2021 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 2021. The Notes to the FinancialStatements adequately cover the standalone and consolidated Audited Statements and form anintegral part of this Report.

8. SECRETARIAL STANDARDS:

Your Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto ‘ Meetings of the Board of Directors' and ‘General Meetings' respectivelyhave been duly 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:

No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year of the Company to which this reportrelates and the date of the report.

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 flavours and fragrances. During the FY 2020-21 itrecorded a total loss of ^13.71 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 of SpecialityAroma Chemicals flavors and fragrances. During FY 2020-21 it recorded a total loss of Rs2.23 lakh. The Company has not yet commenced its operations. The Loss as stated abovepertains to preliminary 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:

There were no loans or guarantees given or securities provided by the Company exceptinvestments made in wholly owned subsidiary (WOS) Oriental Aromatics & Sons Limitedfor which Section 186 of the Companies Act 2013 is not applicable.

Further the details of investments in WOS are given in Notes to the financialstatements forming part of Annual Report.

16. RELATED PARTY TRANSACTIONS:

All Related Party Transactions that were entered into during the FY 2020-21 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 websitewww.orientalaromatics.com and the weblink thereto is:

http://www.orientalaromatics.com/documents/corporate-governance/policies/policy-on-related-party-transactions.pdf

17. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

a. COMPOSITION:

The Board comprises of 8 (eight) directors out of which 4(four) are independentdirectors.

b. RE-APPOINTMENT/APPOINTMENT:

In terms of Section 152 of the Companies Act 2013 and the Articles of Association ofthe Company Mr. Bhadreshkumar Pandya (DIN: 08809906) Executive Director-Operations ofthe Company retires by rotation at the ensuing Annual General Meeting and being eligibleoffers himself 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.

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 49th 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. FAMILARIZATION PROGRAM FOR INDEPENDENT DIRECTORS:

The Company has set Familiarization 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 of the sameis 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 Annual 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 performanceindividual directors as well as the working of the committees of the board. Theperformance evaluation of board and committees was carried out 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 performanceevaluation of the individual directors was carried out by the entire board excluding thedirector being evaluated.

In the separate meeting of independent directors performance evaluation of thechairperson and the nonindependent directors and board as a whole was carried out takinginto account views of executive and nonexecutive 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:

M r. 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 inits meeting held on 10th August 2020 took note of the same and placed on record itsappreciation for the contributions made by him during his tenure as a director.

Mr. Bhadreshkumar A. Pandya (DIN: 08809906) was appointed as ‘Executivedirector-Operations' of the Company for a period of five years in the 48th Annual GeneralMeeting with effect from 10th August 2020.

Ms. Anita Satoskar was appointed as Key Managerial Personnel (KMP) of the Companydesignated as Chief Research & Development Officer under Section 2(51) of theCompanies Act 2013 with effect from 25th March 2021.

Pursuant to the provisions of Section 203 of the Act the KMP's of the Company as on31st March 2021 were as follows:

Mr. Dharmil A. Bodani - Chairman and Managing Director

Mr. Shyamal A Bodani -Executive director

Mr. Bhadreshkumar Pandya - Executive Director- Operations

Mr. Satish Kumar Ray-Executive Director- Operations

Mr. Parag K. Satoskar - Chief Executive Officer

Mr. Girish Khandelwal - Chief Financial Officer

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 standards havebeen followed and there have been no material departures.

b. Such accounting policies have been selected and applied consistently and judgmentsand estimates have been made that are reasonable and prudent to give a true and fair viewof the Company's state of affairs as at 31st March 2021 and of the Company's profit forthe year ended on that date.

c. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities.

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 contributions to Nandesari Education Trust situatedat Vadodara and to Kasturba Gandhi Balika Vidhyalaya situated at Bareilly towards thePromotion of educational facilities.

Your Company also contributed to the Chief Minister Relief Fund at Bareilly towardsSocio-Economic Development and Relief as part of its CSR to contain the spread ofCoronavirus pandemic.

The Corporate Social Responsibility Policy is available on the website of the Companywww.orientalaromatics. com and the web-link thereto is as below:http://www.orientalaromatics.com/documents/corporate-governance/ policies/csr-policy.pdf

During the FY 2020-21 the Company has spent the amount of ^378 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 Board on 29thJune 2020 to ensure its continued relevance and to make any amendments consequent tochanges in applicable law.

The remuneration has been paid as per the Nomination and Remuneration Policy of theCompany. The policy may be accessed on the website of the Company atwww.orientalaromatics.com and weblink thereto is:

http://www.orientalaromatics.com/documents/corporate-governance/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 atwww.orientalaromatics.com at 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 Regulations2015 the Company has adopted a Policy for determining Material Subsidiaries laying downthe criteria 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 24th September 2018 M/s Bagaria& Co LLP (Reg. No. 113447W/W-100019) Chartered Accountants were appointed asstatutory Auditors of the Company for a period of 5 years till the conclusion of 51stAnnual 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 2020-21. 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 2021-2022.

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 2020-21

The Cost Audit report for the FY 2019-20 was filed with Ministry of Corporate Affairson 09th September 2020.

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 2021-22 at a remuneration of Rs 145000/- plus Service Tax &re-imbursement of out-of- pocket expenses. The remuneration is subject to the ratificationof the Members in terms of Section 148 read with Rule 14 of the Companies (Audit andAuditors) Rules 2014 and is accordingly placed for 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 2012-13 in view of thesame no shares and dividend was transferred during the FY 2020-21 pursuant to section124(6) of the Companies Act 2013 read with Investor Education and Protection FundAuthority (Accounting Audit Transfer and Refund) Rules 2016.

25. INSURANCE:

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:

The Equity Shares of the Company are listed at BSE Limited (BSE) and NSE. The Sharesare under compulsory dematerialization list of the Securities & Exchange Board ofIndia. As on 31st March 2021 total 32524660 shares representing 96.64% of CompaniesEquity Share Capital have been dematerialized. The Company has paid Annual Listing feesfor the FY 2021-22 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. ANNUAL RETURN:

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act the Annual Return ason 31st March 2021 is available on the Company's website at the linkhttps://www.orientalaromatics.com/documents/inspection-documents/AR2020-21.pdf

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- D" 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 51 years and Mr. Shyamal A. Bodani aged 40 years are boththe promoters and withdrew a remuneration of Rs 2.01 crore and ^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-E".

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 whohave not yet registered their email addresses are requested to register the same withtheir DPs in case the shares are held by them in electronic form and with our Registrarand Share Transfer Agent- M/s Link intime India Private Limited (RTA) in case the sharesare held by them in physical form. Your Company appeals other Members also to registerthemselves for receiving Annual Report/documents in electronic form.

34. ACKNOWLEDGEMENT:

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 Directors 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 May 2021

.