To the Members
Your Directors are pleased to present the 31st Annual Report and AuditedFinancial Statements for the financial year ended 31st March 2020 togetherwith the Auditors' Report thereon.
WORKING RESULTS OF THE COMPANY
(Rs in Crore)
|Particulars ||Standalone ||Consol idated |
| ||2019-20 ||2018-19 ||2019-20 ||2018-19 |
|Income from operations ||825.33 ||840.26 ||1685.13 ||1757.50 |
|Other Income ||33.38 ||26.30 ||49.06 ||33.93 |
|Profit before Tax ||10.90 ||31.85 ||31.23 ||82.94 |
|Provision for Tax ||5.89 ||10.35 ||9.51 ||15.83 |
|Profit After Tax ||5.01 ||21.50 ||21.72 ||67.11 |
|Other comprehensive income ||(5.57) ||1.32 ||21.74 ||14.73 |
|Total comprehensive income ||(0.56) ||22.82 ||43.46 ||81.84 |
STATE OF THE AFFAIRS OF THE COMPANY
During the year your Company's consolidated income from operations was Rs 1685.13 asagainst Rs 1757.50 Crore in the previous year and Net Profit Rs 21.72 Crore as againstNet Profit Rs 67.11 Crore in the previous year.
The income from operations for the year under review for the Company on Standalonebasis was Rs 825.33 Crore as compared to Rs 840.26 Crore in the previous year and NetProfit Rs 5.01 Crore as compared to Net Profit Rs 21.50 Crore in the previous year.
Pearl Global Industries Limited (PGIL) is one of the India's largest listed garmentexporters manufacturing from multiple sourcing regions within India and countries withinSouth Asia. A preferred long-term vendor to most leading global brands we are amongst theleading player in our Industry. Our mainstay business is to create value fromcompetitively manufacturing and exporting fashion garments to leading global brands.
Our product range includes knits woven and bottoms (basic and complex designs) acrossmen women and kids wear segments. We have a well diversified and de-risked manufacturingbase across India Indonesia Bangladesh and Vietnam. We have a total capacity tomanufacture around 6.25 million garments per month (75 million garments per annumincluding own and outsourced facilities). Our revenue structure is primarily export basedwith a major contribution coming from exports to the United States. We provide totalsupply chain solutions to customers-value retailers and high end fashion brand retails inthe United States and Europe. Our business model enables us to offer superior qualityproducts across various countries catering to all kinds of consumers. Our esteemed globalclientele includes premium retailers in USA and Europe including GAP Banana RepublicKohl's Macy Joe Fresh Walmart M&S Target Australia Zara Ralph Lauren Next TomTailor Old Navy Muji among others.
We strive to be the most preferred vendor to the top global apparel brands and beranked amongst the top garment manufacturers in the world in terms of quality servicestandards and ultimately-customers satisfaction keeping in line with our broader vision.
We are geographically well positioned to produce from the most cost effective supplybases in Asia keeping us highly competitive and relevant to our customers. We expect tomaintain and step up our profitability from superior value added products and meticulousmanagement of our costs and processes.
MATERIAL IMPACT OF COVID-19 PANDEMIC ON COMPANY
The Company's manufacturing facilities remained shut from March 23 2020 due tolockdown and partially re-opened w.e.f. May 04 2020 which has impacted its operationsduring April and May 2020. The Company has restarted operations of factories consideringorder book and available workforce since May 04 2020 adhering to the safety normsprescribed by Government of India.
April-June 2020 being lockdown months the revenues and profitability of the Companyare likely to be adversely impacted. As the business situation is very dynamic theCompany is closely monitoring it. Though we do hope the business situation shouldnormalise during 3rd and 4th quarter.
The Company's capital and Banking facilities remain intact. There is no liquidityconcern as we have sufficient unutilised Banking limits available. Further Banks haveoffered additional limits.
With the virus now also affecting and disrupting global supply chains and economy foralmost 3 to 6 months now the situation is having a severe implication on the Indianeconomy as well.
The areas that would face the crises created by COVID-19 pandemic are: i) Labour forceand employment. ii) Import & Exports of raw material and readymade garments. iii) Cashflow constraints. iv) Supply chain disruption. v) Consumer sentiment.
The Board of Directors has not recommended any dividend for the financial year 2019-20.
TRANSFER TO GENERAL RESERVES
The Board of Directors has decided to retain the entire amount of profits for thefinancial year 2019-20 in the Retained Earnings.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Vinod Vaish has tendered his resignation from the Board of the Company with effectfrom April 30 2020 due to personal reasons. The Board of Directors have taken on recordits appreciation through Circular resolution dated May 20 2020 on significantcontributions made by Mr. Vinod Vaish during his tenure as Whole-Time Director of theCompany.
In compliance with Regulation 17(1)(a) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Board of Directors have on the recommendation ofNomination and Remuneration Committee appointed Mrs. Madhulika Bhupatkar as anadditional Director in the category of Independent Women Director with effect from March18 2020. Appointment of Mrs. Bhupatkar is subject to approval of shareholders in theforthcoming Annual General Meeting. Necessary Resolution for her appointment asIndependent Women Director is proposed in the Notice calling 31st AnnualGeneral Meeting for approval of the Shareholders.
The Company has received necessary declaration from each Independent Director of theCompany that the Independent Directors meet with the criteria of their Independence aslaid down in Section 149(6) of the Companies Act 2013 and Regulation 25(8) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of your Company Mrs Shifalli Seth Director would retire by rotation at theensuing Annual General Meeting and being eligible offer herself for re-appointment.
The Board of Directors of your Company met four times on May 28 2019 August 13 2019November 14 2019 and February 13 2020 during the financial year 2019-20.
DIRECTORS' IDENTIFICATION NUMBER (DIN)
The following are the Directors Identification Number
(D IN) of your Directors:
|Nam e || ||DIN ||Nam e ||DIN |
|Mr. Deepak Seth ||- ||00003021 ||Mr. Chittranjan Dua ||- 00036080 |
|Mr. Pulkit Seth ||- ||00003044 ||Mr. Abhishek Goyal ||- 01928855 |
|Mrs. Shifalli Seth ||- ||01388430 ||Mr. Rajendra Kumar Aneja ||- 00731956 |
|Mr. Anil Nayar ||- ||01390190 ||Mr. Vinod Vaish ||- 01945795 |
| || || ||(Till 30.04.2020) || |
|Mrs. Madhulika Bhupatkar ||- ||08712718 ||Mr. Uma Shankar Kaushik ||- 06867819 |
| || || ||(From 28.07.2020) || |
|Mr. Shailesh Kumar ||- ||08897225 || || |
|(From 07.10.2020) || || || || |
The Board of Directors has on the recommendation of Nomination and RemunerationCommittee at its meeting held on July 28 2020 appointed Mr. Uma Shankar Kaushik asAdditional Director and Whole-Time Director of the Company with effect from July 28 2020.Appointment of Mr. Kaushik is subject to approval of shareholders in the forthcomingAnnual General Meeting. Necessary Resolution for his appointment as Director andWhole-Time Director is proposed in the Notice calling 31st Annual GeneralMeeting for approval of the Shareholders. The Nomination and Remuneration Committee at itsmeeting held on September 24 2020 considered and recommended the candidature of Mr.Shailesh Kumar to appoint him as Director and Whole-Time Director of the Company. TheBoard of Directors has on the recommendation of the Nomination and RemunerationCommittee appointed Mr. Shailesh Kumar as Additional Director and Whole-Time Director ofthe Company with effect from October 07 2020 at its meeting held on October 07 2020.Appointment of Mr. Shailesh Kumar is subject to approval of shareholders in theforthcoming Annual General Meeting. Necessary Resolution for his appointment as Directorand Whole-Time Director is proposed in the Notice calling 31st Annual GeneralMeeting for approval of the Shareholders.
Mr. Raghav Garg Chief Financial Officer (CFO) of the Company has tendered hisresignation from the office of CFO with effect from June 30 2020 due to personalreasons. The Board of Directors have taken on record its appreciation on the contributionsmade by him during his tenure as CFO of the Company.
The Board of Directors has on the recommendation of Nomination and RemunerationCommittee appointed Mr. Kashmir Singh Rathour as Chief Financial Officer of the Companyin place of Mr. Raghav Garg with effect from July 28 2020.
Mr. Rathour aged about 49 years holds Bachelor degree in Science and MBA (Finance)from H.P. University Shimla and having more than 20 years experience in Finance &Accounts as well as Commercial Operations and General Administration Taxation CorporateAffairs Strategic & Business Planning Financial Planning Budgeting Working CapitalManagement designing internal control systems etc.
The Board of Directors has carried out an annual evaluation of its own performancecommittees and individual Directors pursuant to the provisions of the Companies Act 2013and Rules made there under.
The performance of the Board was evaluated by the Board after seeking inputs from allthe Directors on the basis of the criteria such as the Board composition and structureeffectiveness of Board processes information and functioning etc.
The performance of the committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc. The Board and the Nomination and RemunerationCommittee reviewed the performance of the individual Directors on the basis of thecriteria such as the contribution of the individual Director to the Board and committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings etc. In addition the Chairman was also evaluated onthe key aspects of his role.
In a separate meeting of independent Directors performance of non-independentDirectors performance of the Board as a whole and performance of the Chairman wasevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors. The same was discussed in the Board meeting that followed the meeting of theIndependent Directors at which the performance of the Board its committees andindividual Directors was also discussed.
NOMINATION AND REMUNERATION POLICY
The Nomination and Remuneration Policy of the Company is annexed herewith as Annexure-Iwith this report and also available on the website of the Company at http://pearlglobal.com/investors/policy
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal control system commensurate with the sizescale and complexity of operations. During the year such controls were tested and noreportable material weakness in the design or operation was observed.
The Board of Directors in its meeting held on July 28 2020 have re-constituted theAudit Committee consequent upon resignation of Mr. Vinod Vaish from the Board of theCompany and inducted Mrs. Madhulika Bhupatkar as member of the Committee. The currentcomposition of the Committee comprises four Non-executive Independent Directors namelyMr. Anil Nayar Chairman Mr. Abhishek Goyal Mr. Rajendra Kumar Aneja and Mrs. MadhulikaBhupatkar as Members of the Committee. All the recommendations made by the AuditCommittee were accepted by the Board.
The Company has set up a Vigil Mechanism which also incorporates a whistle blowerpolicy in terms of Listing Agreement/Regulations made by the SEBI. Protected disclosurescan be made by a whistle blower through an e-mail or dedicated telephone no. or a letterthrough to the Vigilance Officer or to the Chairman of the Audit Committee. The policy onvigil mechanism and whistle blower policy may be accessed on the Company's website at thelink: http://pearlglobal.com/investors/policy
CORPORATE SOCIAL RESPONSIBILITY
The Corporate Social Responsibility Committee of the Company has formulated a CorporateSocial Responsibility
Policy (CSR Policy) indicating the activities to be undertaken by the Company whichhas been approved by the Board.
The CSR Policy may be accessed on the Company's website athttp://pearlglobal.com/investors/policy
Your Company has identified an area of education and health care activities for thefinancial year 2019-20. The prescribed CSR amount for the financial year 2019-20 was Rs22.15 Lakh and which has been fully utilised.
The Annual Report on CSR activities is annexed herewith as Annexure-II.
During the year under review M/s SBUYS E-Commerce Limited has become wholly ownedsubsidiary of the Company.
Pursuant to Section 129(3) of the Companies Act 2013 a statement containing thesalient features of the financial statements of the subsidiary companies is attached tothe Financial Statements in Form AOC-1. The Company will make available the said financialstatements and related detailed information of the subsidiary companies upon the requestby any member of the Company. These financial statements will also be kept open forinspection by any member at the Registered Office of the Company. The financial statementsof the Company consolidated financial statements along with the relevant documents andseparate audited accounts in respect of subsidiaries are available on the website of theCompany.
The Policy of determining material subsidiaries as approved may be accessed on theCompany's website at http:// pearlglobal.com/investors/policy
Pursuant to the provisions of Section 139 of the Companies Act 2013 M/s B.R. Gupta& Co. Chartered Accountants New Delhi (Regn. No. 008352N) were appointed as StatutoryAuditors of the Company by the members of the Company in their 28th AnnualGeneral Meeting held on 28th September 2017 for a period of five years witheffect from financial year 2017-18.
STATUTORY AUDITORS' REPORT
The Auditors' has given qualified opinion in the Report of Consolidated FinancialStatements for the financial year ended 31st March 2020. The details ofqualified opinion with explanation are given below:
|Auditors' qualified opinion ||Explanation by the Board ||Auditors' Comment on Explanation |
|The inventories are carried in the consolidated balance sheet at Rs 26387.33 Lakh (As at March 31 2019: Rs 23632.17 Lakh). In one of the subsidiary of the Holding Company the component auditor of its subsidiary has reported that no physical counting against inventories as at March 31 2020 was conducted by them due to the lockdown in Jakarta during the outbreak of COVID-19 and no other alternative procedures were performed. In consequence they were unable to carry out auditing procedures necessary to obtain adequate assurance regarding the quantities and condition of inventories of Rs 2542.30 Lakh (Equivalent US$ 3372199) appearing in the consolidated balance sheet. There were no other satisfactory auditing procedures that they could adopt to obtain sufficient evidence regarding the existence and valuation of such inventories. ||Management estimates that impact of Audit qualification is NIL as management has performed complete inventory verification and sufficient checks and controls were performed while valuing the inventory at 31st March 2020. Further post re-opening of lockdown Component Auditor have performed limited review and also performed all necessary checks as on 30th June 2020. ||Based on the Management Representation given above and the Limited Review report of the subsequent period ended June 30 2020 by the Component Auditor it appears that there may not be any material adjustment in the carrying value of Inventory in the consolidated financial statements as at March 31 2020. |
| ||Component Auditor after satisfying themselves have shared interim financial statements as on 30th June 2020 without making any adjustment on account of above qualification. Also Component Auditor has given a clean review report stating that "nothing has come to our attention that causes us to believe that the interim financial statements do not fairly presents in all material respects the interim financial position as at 30.6.20". In view of above management believe no adjustment is required on account of above qualification. || |
Further the Auditor's Report for the Standalone Financial Statements do not containany qualification reservation or adverse remark.
The Auditors' Reports are enclosed with the financial statements in this Annual Report.
The Board has appointed Mr. Jayant Sood Practising Company Secretary proprietor ofM/s. Jayant Sood & Associates. to conduct Secretarial Audit for the financial year2019-20. The Secretarial Audit Report for the financial year 2019-20 is annexed herewithas Annexure-III. The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
The Board has appointed M/s. S. S. Kothari Mehta & Company Chartered AccountantsNew Delhi (FRN. 000756N) as Internal Auditor for the financial year 2019-20.
Maintainance of cost records as specified by the Central Government under section148(1) of the Companies Act 2013 is not applicable to your Company.
EXTRACTS OF ANNUAL RETURN
Pursuant to the provisions of Section 92(3) of the Companies Act 2013 and ruled madethere under as amended an Extract of Annual Return of the Company is annexed herewith asAnnexure-IV to this Report and also available on the Company's website at http://www.pearlglobal.com/investors/annual-return.
EXTENSION OF AGM
The Registrar of Companies NCT of Delhi and Haryana vide its Order dated 07thSeptember 2020 has granted extension of Two (2) months for holding Annual General Meetingof the Company for the financial year ended 31st March 2020.
RELATED PARTY TRANSACTIONS
All related party transactions entered during the financial year were in ordinarycourse of the business and on arm's length basis. No material related party transactionentered during the financial year by the Company.
Members may refer to Note no.47 to the standalone financial statements which sets outrelated party disclosures pursuant to Ind AS-24.
A disclosure on related party as required under Regulation 34(3) read with Schedule Vof SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 is annexed asAnnexure-V.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
Particulars of Loans guarantees and investments covered under Section 186 of theCompanies Act 2013 is annexed as Annexure-VI.
Your Company has not accepted any Fixed Deposits from Public or Shareholders during theyear nor has any unclaimed or unpaid deposits at the end of the financial year.
The Company has implemented procedures and policies in place for risk managementincluding identifying risk which may threaten the existence/operations of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(5) of the Companies Act 2013 withrespect to Directors Responsibility Statement your Directors state that: a) in thepreparation of the annual accounts for the financial year ended 31st March2020 the applicable accounting standards have been followed along with proper explanationrelating to material departures.
There are no material departures from the same; b) the Directors have selected suchaccounting policies and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company at the end of the financial year 31st March 2020 and of the profitand loss of the Company for that period; c) the Directors have taken proper and sufficientcare for the maintenance of adequate accounting records in accordance with the provisionsof the Companies Act 2013 for safeguarding the assets of the Company and for preventingand detecting fraud and other irregularities; d) the Directors have prepared the annualaccounts on a going concern' basis; e) the Directors have laid down internalfinancial controls to be followed by the Company and that such internal financial controlsare adequate and are operating effectively; and f ) the Directors have devised propersystems to ensure compliance with the provisions of all applicable laws and that suchsystems are adequate and operating effectively.
The shares of your Company are listed at BSE Limited and National Stock Exchange ofIndia Limited Mumbai. The listing fees to the Stock Exchanges for the year 2019-20 havebeen paid.
REGISTRAR AND SHARE TRANSFER AGENT
Link Intime India Pvt. Ltd is Company's Registrars and Share Transfer Agent (RTA) ascommon agency both for physical and demat shares as required under Securities Contract(Regulation) Act 1956. The detail of RTA forms part of the Corporate Governance Report.
Report on Corporate Governance along with the certificate of the Auditors confirmingcompliance of conditions of Corporate Governance as stipulated under Schedule V of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forms part ofthe Annual report.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed review of operations performance and future outlook of the Company is givenseparately under the head "Management Discussion and Analysis".
BUSINESS RESPONSIBILITY REPORT
As per Regulation 34(2)(f ) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a Business Responsibility Report is attached and forms part of thisAnnual Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The details as required under Section 197(12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended from time to time is annexed as Annexure-VII to this report.
Particulars of employees as required under Rule 5(2) and (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended from timeto time is annexed as Annexure- VIII to this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to conservation of energ y technology absorption foreignexchange earnings and outgo as required under Section 134(3)(m) is annexed as Annexure-IXto this report.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No significant and material orders were passed by the regulators or courts or tribunalsimpacting the going concern status and Company's operations in future.
REPORT ON SEXUAL HARASSMENT-INTERNAL COMPLAINTS COMMITTEE
Pursuant to the provisions of The Sexual Harassment of Women at the Workplace(Prevention Prohibition and Redressal) Act 2013 Internal Complaints Committee has beenset up to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy. During thefinancial year 2019-20 one complaint received and resolved.
The Company has complied with applicable Secretarial Standards issued by the Instituteof the Company Secretaries of India.
The Directors of your Company are thankful to Bankers Business Associates CustomersMembers Government Bodies & Regulators for the continuous support received from themand place on record their appreciation for the sincere services rendered by the employeesat all level.
| ||for and on behalf of the Board |
|for PEARL GLOBAL INDUSTRIES LIMITED |
| ||(DEEPAK SETH) |
|Place: Gurugram ||CHAIRMAN |
|Date: October 07 2020 ||DIN 00003021 |
ANNEXURE-II ANNUAL REPORT ON CSR ACTIVITIES
1. Over the year we have been focusing on sustainable business practices encompassingeconomic environmental and social imperatives that not only cover our business but alsothat of communities around us.
We had set up a Society namely Arpan Educational Society For Underprivileged Childrenin the year 2006. This was done to provide the free education to underprivileged children.Visit http://www.arpaneducation.com/index.html for more details and the activities of theSociety.
2. Mr. Vinod Vaish has tendered his resignation from the Board of the Company witheffect from April 30 2020. Consequently he has ceased to be as Chairman of the CSRCommittee. The Board of Directors has in its meeting held on July 28 2020 appointed Mrs.Madhulika Bhupatkar Independent Women Director as Chairperson of the CSR Committee.
The current composition of the CSR Committee comprises Mrs. Madhulika BhupatkarChairperson Mr. Pulkit Seth and Mr. Anil Nayar as Members.
3. Average net profit of the Company for last three financial years: Rs 1106.75Lakh
4. Prescribed CSR expenditure (two percent of the amount mentioned in item 3 above): Rs22.13 Lakh The Company has earmarked Rs 22.15 Lakh for CSR expenditure for thefinancial year 2019-20.
5. Details of CSR spent during the financial year:
(a) Total amount to be spent for the financial year: Rs 22.15 Lakh (b) Amount unspentif any: NIL
(c) Manner in which the amount spent during the financial year is detailed below:
(Rs in Lakh)
|Sr. No. ||CSR Project or activity indentified ||Sector in which the Project is covered ||Projects or programmes ||Amount outlay ||Amount Spent on the ||Cumulative ||Amount spent: Direct or through implementing agency |
| || || ||(1) Local Area or other ||(Budget) Project ||Projects or Programs Sub heads: (1) Direct expenditure on projects or program ||expenditure upto to the reporting period || |
| || || ||(2) Specify the State and district where projects or programs was undertaken ||or Program wise ||(2) Overheads || || |
|1. ||Education and other initiatives ||Promoting Education ||NCT of Delhi ||15.65 ||15.65 ||15.65 ||Through Arpan Educational Society For Underprivileged Children |
|2. ||Education and other initiatives ||Promoting Education ||NCT of Delhi ||0.50 ||0.50 ||0.50 ||Through Etasha Society |
|3. ||Education and other initiatives ||Promoting Education ||NCT of Delhi ||3.50 ||3.50 ||3.50 ||Through Sasakawa India Leprosy Foundation |
|4. ||Health care activities ||Promoting preventing Health care activities ||NCT of Delhi ||2.50 ||2.50 ||2.50 ||Through Cancer Awareness Prevention and Early Detection Trust |
| ||Total || || ||22.15 ||22.15 ||22.15 || |
6. Reasons for not spending the amount: Not applicable; as the Company has spent morethan the minimum prescribed amount for CSR activities.
7. RESPONSIBILITY STATEMENTS
The Responsibility Statement of the CSR Committee of the Board of Directors of theCompany is reproduced below: "The implementation and monitoring of Corporate SocialResponsibility (CSR) Policy is in compliance with CSR objectives and policy of theCompany."
|Place: Gurugram ||(Pulkit Seth) ||(Madhulika Bhupatkar) |
|Date: October 07 2020 ||Managing Director ||Chairman of CSR Committee |
SECRETARIAL AUDIT REPORT
For the financial year ended 31st March 2020
[Pursuant to section 204(1) of the Companies Act 2013 and rule No. 9 of the Companies(Appointment and Remuneration Personnel) Rules 2014]
Pearl Global Industries Limited CIN: L74899DL1989PLC036849
A-3 Community Centre Naraina Industrial Area Phase-II New Delhi-110028
We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by Pearl Global IndustriesLimited (hereinafter called the Company). Secretarial Audit was conducted in a manner thatprovided us a reasonable basis for evaluating the corporate conducts/statutory compliancesand expressing our opinion thereon.
We report that: a) Maintenance of secretarial records is the responsibility of themanagement of the Company. Our responsibility is to express an opinion on thesesecretarial records based on our audit. b) We have followed the audit practices andprocesses as were appropriate to obtain reasonable assurance about the correctness of thecontents of the secretarial records.
The verification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion. c) We have not verified the correctness andappropriateness of the financial statements of the Company. d) Wherever required we haveobtained the Management representation about the compliances of laws rules andregulations and happening of events etc. e) The compliance of the provisions of thecorporate and other applicable laws rules regulations standards is the responsibilityof the management. Our examination was limited to the verification of procedures on testbasis. f ) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client; g)*The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations2009; h) *The Securities and Exchange Board of India (Buyback of Securities) Regulations1998 and Securities and Exchange Board of India (Buy-back of Securities) regulations2018; and i) The Securities and Exchange Board of India (Listing obligations andDisclosures requirements) Regulations 2015; *No event took place under these regulationsduring the audit period.
We have also examined compliance with the applicable clauses of the SecretarialStandard on Meetings of the Board of Directors and on General Meetings issued by TheInstitute of Company Secretaries of India with which the company has generally compliedwith.
During the Audit Period the Company has complied with the provisions of the ActRules Regulations and Guidelines to the extent applicable.
Based on our verification of Pearl Global Industries Limited's books papersminute books forms and returns filed and other records maintained by the Company and alsothe information provided by the Company its officers agents and authorizedrepresentatives during the conduct of Secretarial Audit we hereby report that in ouropinion the Company has during the audit period covering the financial year ended on31st March 2020 complied with the statutory provisions listed hereunder and also that theCompany has proper Board- processes and compliance mechanism in place to theextent in the manner and subject to the reporting made hereinafter: We have examined thebooks papers minute books forms and returns filed and there records maintained by PearlGlobal Industries Limited ("the Company") for the financial year ended on31st March 2020 according to the provisions of (hereinafter to be referred as"Act" collectively) (Many of the Records were examined online due to Covid 19): Wehave also examined compliance with the applicable Clauses / Regulations of thefollowing: i. Secretarial Standards issued by The Institute of Company Secretaries ofIndia. ii. The Listing Agreements entered into by the Company with BSE and NSE StockExchange(s). iii. The Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
During the period under review we found that the Company has complied with the variousprovisions of the Act Rules Regulations Guidelines Standards etc. mentioned above areas follows:
Company has received the disclosure under Regulation 30(1) and 30(2) of SEBI(Substantial Acquisition of Shares and Takeovers) Regulations 2011 and intimated to StockExchanges also.
Company has received declaration under Section 149(6) of the Companies Act 2013from all the Independent directors.
Company has adopted a conflict of interest policy a code of business conductsetting out the Company's requirements and process to report and deal with non compliance.
Company has made responsible the Compliance officer for oversight and managementof these policies and procedures.
Company has established various policies as per the Companies Act 2013 andlisting agreement / SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 like
CSR policy Vigil Mechanism policy Related Party Transaction Policy WhistleBlower Policy and Directors appointment and remuneration policy.
Company has composite various committee(s) are as under:
1. Audit Committee:
Mr. Anil Nayar - Chairman Mr. Rajendra K. Aneja - Member Director Mr. Abhishek Goyal -Member Director Mr. Vinod Vaish - Member Director
2. Nomination and Remuneration Committee:
Mr. Abhishek Goyal - Chairman Mr. Rajendra K. Aneja - Member Director Mr. Anil Nayar -Member Director Mr. Deepak Seth - Member Director
3. Stakeholders Relationship Committee:
Mr. Anil Nayar - Chairman Mr. Pulkit Seth - Member Director
Mr. Vinod Vaish - Member Director Mr. Rajendra K. Aneja - Member Director
4. CSR Committee:
Mr. Vinod Vaish - Chairman Mr. Pulkit Seth - Member Director Mr. Anil Nayar - MemberDirector
5. Finance Committee
Mr. Pulkit Seth - Chairman Mrs. Shifalli Seth - Member Director Mr. Vinod Vaish -Member Director
6. Compliance Officer:
Mr. Sandeep Sabharwal
The Company's shares are in compulsory demat segment and are available fortrading in the depository system of both NSDL and CDSL. As on 31st March 2020the company has 19368523 shares in NSDL A/ c 2154834 shares in CDSL A/c andbalance of 140580 are in physical mode.
The Company's shares in physical form are processed by the Registrar and Share TransferAgent Link Intime India Pvt Ltd having office at Noble Heights 1st FloorNH 2 C-1 LSC Near Shavitri Market Janakpuri New Delhi 110 058 and approvedby the Stakeholders Relationship Committee. Share transfer process also reviewed by theBoard.
Investor's Grievance Report during the Financial year: No. of GrievancesReceived - 3 No. of Grievances Attended - 3 No. of Grievances Pending - 0
As informed to us there is no change in general character or nature of business/ disruption of operations due to natural calamity/ dispute with a material impact duringyear.
The Company has published quarterly results during the year in time.
Various Committee meetings and meeting of Independent Directors: Audit Committee: Duringthe Financial Year 2019-20 Audit Committee met on 28.05.2019 13.08.2019 14.11.2019 and13.02.2020 The Company has also maintained the proper record of the minutes of themeetings.
Stakeholders Relationship Committee: During the Financial Year 2019-20 thecommittee met on 24/04/2019 6/11/2019 10/01/2020 and 06/03/2020. The Company has alsomaintained the proper record of the minutes of the meetings.
Nomination and Remuneration Committee meeting:
The Committee met on 28/05/2019 and 13/02/2020 during the Financial Year 2019-20.
The Committee met on 28/05/2019 during the Financial Year 2019-20.
The Committee met on 30/04/2019 20/05/2019 08/07/ 2019 03/08/2019 16/09/201924/10/2019 14/11/2019 06/12/2019 18/12/2019 17/01/2020 11/02/2020 26/ 02/2020 duringthe Financial Year 2019-20.
Independent Directors' meeting:
During the Financial Year 2019-20 the Independent Directors met on 02/03/2020.
We further report that:
The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors.
|Composition of the Board: ||LIST OF DIRECTORS AS ON 31.03.2020 |
|S. NO. ||NAME AND FATHER'S NAME OF THE DIRECTORS ||DIN |
|1 ||Mr. Deepak Seth S/o Late Shri Madan Lal Seth ||00003021 |
|2 ||Mr. Pulkit Seth S/o Shri Deepak Seth ||00003044 |
|3 ||Mrs. Shefali Seth D/o Shri Sunil Pal Seth ||01388430 |
|4 ||Mr. Rajendra Kumar Aneja S/o Late Shri Hari Chand Aneja ||00731956 |
|5 ||Mr. Chittranjan Dua S/o Late Shri Inder Dev Dua ||00036080 |
|6 ||Mr. Anil Nayar S/o Late Shri Prakash Chand Nayar ||01390190 |
|7 ||Mr. Vinod Vaish S/o Shri Motilal Vaish (Resigned on 30th April 2020) ||01945795 |
|8 ||Mr. Abhishek Goyal S/o Lt. Shri Berjesh Kumar Goyal ||01928855 |
|9. ||Mrs. Madhulika Bhupatkar D/o Dattatreya Ranganath Deo ||08712718 |
Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting.
Details of Board Meeting:
Board has met four times during the financial year on:
|S. No. ||Date of meeting ||Date of Notice |
|1. ||28.05.2019 ||13.05.2019 |
|2. ||13.08.2019 ||29.07.2019 |
|3. ||14.11.2019 ||01.11.2019 |
|4. ||13.02.2020 ||29.01.2020 |
The Company has also maintained the proper record of the minutes of the meetings.
Majority decision are carried through the Board (means unanimously) and there is nodissenting members' views are captured and recorded as part of the minutes.
Annual General Meeting:
During the Financial Year 2019-20 the Company has called 30th Annual GeneralMeeting for the Financial Year 2018-19 on 24th September 2019 at SriSathya Sai International Centre Pragati Vihar (Near Pragati Vihar Hostel) Lodhi RoadNew Delhi-110 003 The Company has kept the date of book Closure on 18th September 2019 to24th September 2019 (both days inclusive).
Maintenance of Statutory Registers:
The Company has maintained the following Statutory Registers required under theCompanies Act 2013.
1. Register of Members
2. Register of Directors and Key Managerial personnel
3. Register of Security held by the Director
4. Register of Loans Investment and Guarantee
5. Register of Charge
6. Register of Contracts or Arrangements
7. Register of Transfer and Transmission.
8. Register of Renewal and Duplicate Shares Certificate
Declaration and Payment of Dividend:
The Dividend declared for the financial year ending 31st March 2019 is paidin prescribed time. The Board of Directors have declared final dividend Rs 3/- per EquityShare of Rs 10/- each for the financial year 2018-19.
We further report that there are adequate systems and processes in theCompany commensurate with the size and operations of the Company to monitor and ensurecompliance with applicable laws rules regulations and guidelines.
As the Company carries on the business of manufacturing Export and Merchant trade ofreadymade Garments. As informed by the management the following laws are the specificlaws specifically applicable to the Company;
1. The Air (Prevention and Control of Pollution) Act 1981.
2. The Indian Boilers Act 1923.
3. The Child Labour (Prohibition and Regulation) Act 1986.
4. The Contract Labour (Regulation and Abolition) Act 1970.
5. The Factories Act 1948.
6. The Fatal Accidents Act 1855.
7. The Industrial Disputes Act 1947.
8. The Industrial Employment (Standing Orders) Act 1946.
9. The Industries (Development and Regulation) Act 1951.
Company has established various policy and systems as per the above applicable Acts forall units and work Places.
We have Examined the records available and provided to us during our visit to 3 (three)units/ Plants (A) 446 Udyog Vihar Phase-V Gurugram Haryana (B) 16-17 Udyog Vihar PhaseVI Khandsa Gurugram Haryana (C) 274 Udyog Vihar Phase-II Gurugram Haryana.
For Jayant Sood and Associates
(CS Jayant K Sood)
FCS: 4482 CP No. 22410
Date: 13th July 2020