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Pearl Polymers Ltd.

BSE: 523260 Sector: Industrials
NSE: PEARLPOLY ISIN Code: INE844A01013
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VOLUME 4740
52-Week high 38.00
52-Week low 16.00
P/E
Mkt Cap.(Rs cr) 40
Buy Price 0.00
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OPEN 23.25
CLOSE 24.25
VOLUME 4740
52-Week high 38.00
52-Week low 16.00
P/E
Mkt Cap.(Rs cr) 40
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Pearl Polymers Ltd. (PEARLPOLY) - Director Report

Company director report

TO THE MEMBERS

Your Directors are pleased to present the 51st Annual Report of PearlPolymers Limited ("the Company") for the financial year ended March 31 2022.

FINANCIAL SUMMARY

The Company's financial performance for the financial year ended March 31 2022 incomparison to previous financial year is summarized below:

(Rs. in Lakhs)

Particulars 2021-22 2020-21
Total Revenue 10477.17 11528.75
Total expenses 7690.65 12586.37
Profit/(loss) before exceptional items and tax 2786.52 (1057.62)
Less: Tax Expenses 602.14 -
Profit/Loss after tax 2184.38 (1057.62)

STATE OF THE COMPANY'S AFFAIRS/ CHANGES IN THE NATURE OF BUSINESS IF ANY

The Financial results for the year 2021-22 are not comparable with that for the year2020-21 due to completion of slump sale transaction with Manjushree Technopack Limited("MTL"). On April 12 2021 the transaction of slump sale was completed at alumpsum amount of Rs. 8758.72 Lakhs without values being assigned to any individual assetsand liabilities. During the year under consideration on Standalone basis your Company hasachieved total Revenue of Rs. 10477.17 Lakhs as against Rs. 11528.75 Lakhs in therelevant previous financial year. There is a net profit of Rs. 2184.38 as compared to anoperating loss of Rs. 1057.62 Lakhs in the previous year.

ECONOMIC OUTLOOK KEY CHALLENGES AND RESPONSE

The outbreak of the Covid-19 pandemic caused significant disruption during 2019-20.Impact of this disruption flowed over till the first two quarters of 2021-22. In the thirdquarter the country progressed into a scenario with free movement of goods and people.The economy grew considerably during the year.

India's revival in consumer spending is likely to be driven by households that earnmore than a million rupees a year. Consumer sentiments survey data suggest that while allincome groups are worse off than they were earlier richer households are doing betterthan the rest on the sentiments front. These are the least affected households and mostlikely with the best savings.

India is going digital and the pandemic has accelerated this shift. Even before theCOVID-19 pandemic India's e- commerce sector had begun to gain immense traction as peopleswayed from physical shopping and gravitated towards online shopping. The pandemicaccelerated this adoption of e-commerce and India today is one of the fastest-growinge-commerce markets in the world with an estimated 330 million online shoppers.

Consumers are flocking online for almost all their needs - from groceries andessentials to clothing and accessories. Moreover goods that will come in useful duringlong periods at home are seeing increased sales. Brands have been compelled to develop anonline presence even if they had none before. This has led to a massive spurt in Direct toConsumer (D2C) brands.

The economy is now enabling people to cater to niche segments of consumers economicallyand there is also a rise in digital entrepreneurs. Brands are also realizing the need toapproach consumers directly rather than going to marketplaces to build private labels.Moreover payment infrastructure and integration with multiple payment options and thedemand for niche products has led to the surge in the number of D2C brands.

Pearl Polymers Limited during the year 2021-22 completed the transition from B2Bindustrial goods manufacturer to focusing completely on its consumer business through thePearlpet brand.

We are proud to have bought a new thought process to the Indian kitchen by making thefirst safe transparent unbreakable odorless plastic jars & bottles. We are nowexpanding our range to include trendy steel glass biodegradable and other products.Pearlpet is synonymous with quality and consumer satisfaction as the leading manufacturerof kitchen jars containers bottles and other storage solutions. Pearlpet is theone-stop-shop for those seeking safe and durable storage solutions. We also producedurable products in rust-free materials and are the pioneers of primary food packaging inIndia. Constantly seeking to improvise and grow Pearlpet is heavily focused on innovatingthrough its thorough R&D department accelerating Pearlpet towards the internationalmarket and garnered several awards nationally and internationally. Taking pride in ourproducts' utility to our consumers Pearlpet has made conscious choices to develop andproduce air-tight highly durable and 100% recyclable products.

RESERVES

The Reserves and Surplus (excluding Revaluation Reserve) of the Company as on March 312022 stood at Rs. 2802.73 Lakhs. No amount is proposed to be transferred to reservesduring the year.

DIVIDEND

In order to strengthen the operations of the Company the Board of Directors has notrecommended any dividend on equity shares for the year under review.

SHARE CAPITAL

The Company's Capital Structure remains unchanged during the financial year 2021-22.

MATERIAL CHANGES AFFECTING FINANCIAL POSITION BETWEEN END OF FINANCIAL YEAR AND DATE OFREPORT

There are no material changes and commitments that affect the financial position of theCompany between the date of closure of Financial Year and the date of this report.

MATERIAL ORDERS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY

There was no order passed by any regulatory authority or court or tribunal against theCompany impacting the going concern status and future operations of the Company.

DEPOSITS

Your Company has not accepted any deposits during the year under review falling withinthe ambit of Section 73 of the Companies Act 2013 read with the Companies (Acceptance ofDeposits) Rules 2014.

INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to Section 125 of the Companies Act 2013 read with Investor Education andProtection Fund Authority (Accounting Audit Transfer and Refund) Rules 2016 the amountof fixed deposit remaining unpaid /unclaimed for a period of seven years has beentransferred to the Investor Education and Protection Fund (IEPF) established by theCentral Government of India. Further the Company has uploaded the necessary informationin respect of the unclaimed amount on the website of IEPF viz. www.iepf.gov.in and on theCompany's website at www. pearlpet. net

CORPORATE SOCIAL RESPONSIBILITY

The provisions of Corporate Social Responsibility as prescribed under section 135 ofthe Companies Act 2013 were not applicable to the Company during the year under review.

HOLDING SUBSIDIARY ASSOCIATE OR JOINT VENTURE COMPANIES

The Company has no Holding Subsidiary Associate or Joint Venture Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board expresses a sincere thanks to Mr. Chand Seth for his long association of morethan 50 years with the Company. He was associated with the Company since 1971. He is thefounding chairman of the Company. With the help of his immense experience of over 51 yearsin the field of Polymers he significantly contributed in making the Pearlpet a recognizedbrand. Under his strong leadership and strong determination a small unit was built tomultiple plants across various locations in India. He always believed in leveraging theuse technology by using hi- tech machines in manufacturing. During his tenure as Chairman& Managing Director of the Company he has developed strong customer relations withlarge MNCs over the years and built large customer base. Under his leadership Pearl hasbecome leading manufacturer of rigid packaging and houseware products since its inceptionin 1971 the Company became the pioneer in the field of PET & PP packaging in India.He has always been pioneer in the field of polymers. His unique business ideas and strongwill made the Company survive in such a competitive environment since its inception in1971. During his tenure in the Company he gave employment to thousands of employees overthe years and always believed in contributing for the social and noble causes.

Keeping in view his long term association with the Company and his contribution andefforts in the interest and growth of the Company and other stakeholders over the timespan of over 50 years the Board expresses sincere gratitude and place on record sincereappreciation for the invaluable guidance and contribution made by him towards growth anddevelopment of the Company.

During the year under review following changes took place in the Board and KeyManagerial Personnel of your Company:

i. Mr. Varun Seth has been appointed as Whole Time Director of the Company with effectfrom July 01 2021.

ii. Mr. Chand Seth has retired as Chairman & Managing Director of the Company witheffect from end of working hours of August 14 2021. However at the request for hisguidance and assistance in the growth and expansion of the Company Mr. Chand Sethaccepted to be designated as Chairman Emeritus in the capacity of advisor and continue hisinvaluable association with the Company.

iii. Mr. Udit Seth has been appointed as Chairman & Managing Director of theCompany with effect from August 16 2021.

iv. Mr. Amit Seth has been appointed as Whole Time Director of the Company with effectfrom August 16 2021.

v. Mr. Ramesh Mehra has resigned from the office of additional director (Non-Executiveand Non-Independent) with effect from August 12 2021

vi. During the year Mr. Vineet Gupta has resigned from the office of Company Secretary& Compliance Officer of the Company with effect from 7th March 2022.

Pursuant to the provisions of Section 152 of the Companies Act 2013 Mr. Varun SethWhole Time Director of the Company retires by rotation at the ensuing Annual GeneralMeeting and being eligible offers himself for reappointment. The brief resume of Mr.Varun Seth as required under the Listing Regulations and Secretarial Standards is providedin the Notice of the 51st Annual General Meeting of the Company. The requisiteresolution pertaining to the re-appointment appears at the respective item of the Noticealong with the Statement and is recommended to the Members for approval.

DECLARATION BY INDEPENDENT DIRECTOR

The Company has received declarations from the Independent Directors confirming thatthey meet the criteria of independence as prescribed under Section 149(6) of the CompaniesAct 2013 and as per the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

Further in terms of Section 150 of the Companies Act 2013 read with Rule 6 of theCompanies (Appointment and Qualification of Directors) Rules 2014 Independent Directorsof the Company have confirmed that they have registered themselves with the databankmaintained by the Indian Institute of Corporate Affairs.

In the opinion of the Board Independent Directors fulfill the conditions specified inthe Act Rules made thereunder and Listing Regulations and possess relevant expertise& experience and are independent of the management.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual Directors as per the formal mechanism for such evaluationadopted by the Board pursuant to Companies Act 2013 and Regulation 17 (10) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

The exercise of performance evaluation was carried out through a structured evaluationprocess covering various aspects of evaluation. Any member of the Board did notparticipate in the discussion of his/her evaluation. Performance evaluation of IndependentDirectors was carried out by the entire board excluding the Independent Director beingevaluated.

A meeting of the Independent Directors was also held to review the performance of theNon-Independent Directors the Board as a whole and the Chairperson on the parameters ofeffectiveness and to assess the quality quantity and timeliness of the flow ofinformation between the Management and the Board.

NOMINATION AND REMUNERATION POLICY

Your Company has adopted a Nomination and Remuneration Policy as required by Section178 of the Companies Act 2013 which provides for the appointment and removal ofDirectors Key Managerial Personnel &senior management board diversity and theirremuneration including criteria for determining qualifications positive attributesindependence of a director etc. The remuneration paid is as per the Policy. The details ofsuch policy can be viewed on the Company's website www.pearlpet.net.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

The Board of Directors met Five (5) times during the financial year 2021-22 thedetails of which are given in the Corporate Governance Report which forms part of thisAnnual Report. The intervening gap between any two meetings was within the periodprescribed under the Companies Act 2013.

A separate meeting of the Independent Directors was also held to review the performanceof Non-independent Directors and overall performance of the board.

AUDIT COMMITTEE

The Composition of Audit Committee of the Company is described in Corporate GovernanceReport as stipulated under Listing Regulations which forms integral part of this Report.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of Loans Guarantees or Investments if any covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statements.

RISK MANAGEMENT AND INTERNAL FINANCIAL CONTROL

The Company has put in place a policy and mechanism to identify assess monitor andmitigate various risks to key business objectives. Major risks identified by thebusinesses and functions are systematically addressed through mitigating actions oncontinuing basis. There are no risks which in the opinion of the Board threaten theexistence of the Company. Your Company has an Internal Financial Control System which wasoperating effectively for ensuring the orderly and efficient conduct of its business thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

INSIDER TRADING CODE

The details regarding insider trading code are given in the Corporate Governancesection of the Annual Report. Your Company has also adopted a policy for determination oflegitimate purposes in line with the PIT (Amendment) Regulations 2018 as a part of Codeof practices and procedures of fair disclosures of unpublished price sensitiveinformation.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

Your Company is committed to highest standards of ethical moral and legal businessconduct. The Company has a policy on whistle blower and vigil mechanism for providing aframework to promote responsible and secure whistle blowing. It protects Directors andemployees wishing to raise a concern about serious irregularities within the Company. ThePolicy is available on the Company's website at www.pearlpet.net.

During FY 2021-22 no complaint was received. Further no individual was denied accessto the Audit Committee for reporting concerns if any.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL ACT) 2013

Your Company has a policy on prevention of Sexual Harassment in line with therequirement of Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013 and has constituted the Internal Complaints Committee. All employees(Permanent Contractual Temporary Trainees) are covered under this policy. The Companyhas not received any complaint of sexual harassment during the financial year 2021-22.

PARTICULARS OF EMPLOYEES AND REMUNERATION

The Disclosure required under Section 197(12) of the Act read with the Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexedas Annexure T and forms an integral part of this Report. A statement comprising the namesof top 10 employees and other details in terms of remuneration drawn in terms of Rule 5(2)& (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 forms an integral part of this annual report but the said statement is not being sentalong with this annual report to the members of the Company in line with the provisions ofSection 136 of the Act. However the said information is available for inspection by theMembers at the Registered Office of the Company during business hours on working days ofthe Company up to the date of ensuing AGM. Members who are interested in obtaining theseparticulars may write to the Company Secretary at the Registered Office of the Company onany working day of the Company up to the date of the ensuing Annual General Meeting.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars in respect of Conservation of Energy Technology absorption and ForeignExchange earnings and outgo as required under section 134 (3)(m) of the Companies Act2013 read with the rules there under are provided in Annexure-‘II' to this report.

DIRECTORS' RESPONSIBILITY STATEMENT

The Board of Directors of the Company to the best of their knowledge and beliefconfirm that:

I. In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;

II. The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2022 and of the profitand loss of the Company for that period;

III. The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

IV. The Directors have prepared the annual accounts on a going concern basis;

V. The Directors have laid down internal financial controls which were followed by theCompany and such internal financial controls are adequate and were operating effectively;and

VI. The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and such systems were adequate and operating effectively.

AUDITORS

a) Statutory Auditors

Statutory Auditors and Auditor's Report

The shareholders of the Company at 46thAGM held on September 29 2017 hadre-appointed M/s. Sehgal Mehta & Co. Chartered Accountants (ICAI RegistrationNo-003330N) as the Statutory Auditors of the Company for a term of 5 years subject toratification by members at every AGM if required under the provisions of the CompaniesAct 2013. However the Companies Amendment Act 2017 has removed the requirement ofratification of statutory auditors and accordingly they hold their office till theconclusion of Annual General Meeting to be held in 2022.

The Notes on financial statement referred to in the Auditor's Report areself-explanatory and do not call for any further comments. The Auditor's Report does notcontain any qualification reservation adverse remark or disclaimer. There are no fraudsreported in the reports of the Auditors as mentioned under sub-section (12) of Section 143of the Act.

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 Board of Directorsappointed Ms. Rashmi Sahni (Certificate of Practice No. 10493) Practicing CompanySecretary to undertake the Secretarial Audit of the Company for FY 2021-22. Copy ofSecretarial Audit Report is annexed as Annexure-‘III' to this report

The Secretarial Audit Report of your Company does not contain any qualificationreservation or adverse remark.

c) Internal Auditor

Pursuant to the provisions of Section 138 of the Companies Act 2013 the Board ofDirectors appointed Nikhil Goel & Associates (Firm Registration No. 020934C) CharteredAccountants as an Internal Auditor of the Company to conduct an internal audit of thefunctions and activities of the Company for financial year 2021-22.

d) Cost Auditor

The provisions regarding maintenance of Cost Records and conducting the Cost Audit asprescribed under section 148 of the Companies Act 2013 are not applicable to the Company.

COMPLIANCE WITH THE INSTITUTE OF COMPANY SECRETARIES OF INDIA ("ICSI")SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards issued by the Institute ofCompany Secretaries of India on meetings of Board of Directors its Committee(s) andGeneral Meetings.

STATUTORY COMPLIANCES

The Board periodically reviews the mechanism put in place by the management to ensurethe compliances with Laws and Regulations as may be applicable to the Company as well asthe steps taken by the Company to rectify the instances of non-compliances if any.

RELATED PARTY TRANSACTIONS

During the year there were no transactions with related parties which were not atarm's length and not in the ordinary course of business as per the provisions of section188 of the Companies Act 2013 or materially significant or which were in conflict withthe interests of the Company and that require an approval of the Company's shareholders interms of the Companies Act or SEBI Listing Regulations. Accordingly the disclosure of thetransactions in Form AOC-2 is not applicable to your Company.

All Related Party Transactions are placed before the Audit Committee and the Board forreview and approval. Prior omnibus approval of the Audit Committee was obtained for thetransactions which are of a foreseen and repetitive nature. The transactions entered intopursuant to the omnibus approval so granted are placed before the Audit Committee and theBoard of Directors for their review on a quarterly basis. The detailed policy on RelatedParty Transactions is available on the website of the Company at www.pearlpet.net. Thedetails regarding Related Party Transactions are contained in the Notes to FinancialStatements.

ANNUAL RETURN

Pursuant to Sec 92(3) of the Companies Act 2013 read with Rule 12 of the Companies(Management and Administration) Rules 2014 the copy of Annual Return can be accessed atCompany's website at www. pearlpet. net.

CORPORATE GOVERNANCE REPORT

A Separate report on Corporate Governance along with certificate from Ms. Rashmi SahniPracticing Company Secretary confirming compliance with the requirement of CorporateGovernance as stipulated under SEBI (LODR) Regulations 2015 as amended from time to timeforms an integral part of the Annual Report and is attached as Annexure-'IV'.

CAUTIONARY STATEMENT

Statements in this report particularly those which relate to Management Discussion& Analysis describing the Company's objectives projections estimates andexpectations may constitute forward looking statements' within the meaning of applicablelaws and regulations. Actual results may differ materially from those either expressed orimplied.

ACKNOWLEDGEMENT

The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Boards ofDirectors also wish to place on record its deep sense of appreciation for the committedservices by the Company's executives staff and workers.

Last but not least your Directors wish to place on record their warm appreciation toyou for your continuous support and encouragement.

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