You are here » Home » Companies » Company Overview » Rallis India Ltd

Rallis India Ltd.

BSE: 500355 Sector: Agri and agri inputs
NSE: RALLIS ISIN Code: INE613A01020
BSE 00:00 | 12 Aug 224.95 -0.60
(-0.27%)
OPEN

228.90

HIGH

228.90

LOW

224.50

NSE 05:30 | 01 Jan Rallis India Ltd
OPEN 228.90
PREVIOUS CLOSE 225.55
VOLUME 31420
52-Week high 324.85
52-Week low 182.55
P/E 29.37
Mkt Cap.(Rs cr) 4,375
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 228.90
CLOSE 225.55
VOLUME 31420
52-Week high 324.85
52-Week low 182.55
P/E 29.37
Mkt Cap.(Rs cr) 4,375
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Rallis India Ltd. (RALLIS) - Director Report

Company director report

To the Members of Rallis India Limited

The Directors present their Seventy-Fourth (74th) Annual Report on the business andoperations of Rallis India Limited (‘the Company') along with the Audited FinancialStatements for the Financial Year (‘FY') ended March 31 2022.

Financial Results

(Rs in crore)

Particulars Standalone Consolidated
Year ended March 31 2022 Year ended March 31 2021 Year ended March 31 2022 Year ended March 31 2021
Revenue from operations 2603.93 2429.43 2603.93 2429.44
Other Income 27.44 40.44 27.46 40.45
Total Income 2631.37 2469.87 2631.39 2469.89
Profit before finance cost depreciation and tax 301.58 363.43 301.51 363.33
Finance costs 4.79 5.21 4.79 5.21
Depreciation 74.31 64.07 74.31 64.07
Profit before exceptional items and tax 222.48 294.15 222.41 294.05
Exceptional items 0.00 9.45 0.00 9.45
Profit before tax 222.48 303.60 222.41 303.50
Provision for tax 62.18 77.03 62.18 77.04
Deferred tax (3.97) (2.10) (3.97) (2.10)
Profit for the year 164.27 228.67 164.20 228.57
Profit for the year attributable to:
- Owners of the Company 164.27 228.67 164.20 228.58
- Non-controlling interests - - - -
Other comprehensive income (‘OCI') (0.65) 1.32 (0.56) 1.40
Total comprehensive income 163.62 229.99 163.64 229.96
Profit for the year 163.62 229.99 163.64 229.96
Balance of Profit brought forward from previous year 1128.50 947.14 1213.04 1031.77
1292.12 1177.13 1376.68 1261.75
Appropriations
Others (0.01) 0.00 0.55 0.00
Dividend on equity shares# (58.34) (48.62) (58.34) (48.62)
Transfer to reserve for equity instruments through 0.00 (0.01) (0.09) (0.08)
OCI
Balance profit carried forward to balance sheet 1233.77 1128.50 1318.80 1213.04

 

# Dividend declared in the previous year and paid during the respectivereporting year

Dividend

The Directors are pleased to recommend a dividend of Rs 3 per share (i.e. 300%) on theEquity Shares of the Company of Rs 1 each for the year ended March 31 2022 (previous yearRs 3 per share i.e. 300%). If the dividend as recommended above is declared at theensuing Annual General Meeting (‘AGM') the total outflow towards dividend on EquityShares for the year would be Rs 58.34 crore (previous year Rs 58.34 crore).

Dividend Distribution Policy

Pursuant to Regulation 43A of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 (‘SEBI ListingRegulations') the Board of Directors of the Company have adopted a Dividend DistributionPolicy which aims to maintain a balance between profit retention and a fair sustainableand consistent distribution of profits among its Members. The said Policy is available onthe website of the Company under the ‘Investors' section at https://www.rallis.com/dividend-distribution-policy .

Transfer to Reserves

The Board of Directors has decided to retain the entire amount of profits for FY2021-22 in the profit and loss account.

Share Capital

The paid-up Equity Share Capital as on March 31 2022 was Rs 19.45 crore. Duringthe year under review the Company has not issued any shares.

Coping with challenges in the short term and transforming for the long term

During the year under review the Company continued to move ahead with resilience. TheCompany recorded a double digit growth in its Domestic Crop Care business and positivemomentum in exports. The Company also drove commercialisation of key capital projects.This has been achieved despite the challenges posed by the pandemic and other volatilebusiness factors. The Company continued to leverage its strengths and expertise forsupporting business growth as well as prioritising safety and well-being of its employeesand other stakeholders. The Company is also working to navigate the volatility anduncertainty arising from the recent geopolitical crisis. The journey of innovation andtransformation continues to remain a thrust area through various initiatives such asenhancing manufacturing capacities digitalisation launching new products enhancingbrand visibility etc. During the year under review a state-of-the-art formulation plantwas inaugurated in Dahej Gujarat.

The Company endeavours to accelerate its journey and enhance value in areas ofenvironmental sustainability societal initiatives and long-lasting partnerships alongwith continuous focus on cost optimisation across the value chain.

Company's Performance

The Company's consolidated revenue from operations for FY 2021-22 was Rs 2604crore compared to Rs 2429 crore in the previous year an increase of 7.2% over theprevious year. The Company's Profit before exceptional items on a consolidated basis wasRs 222 crore during the year compared to Rs 294 crore in the previous year. The Companyearned a net profit after tax of Rs 164 crore lower by 28.2% as against a netprofit after tax of Rs 229 crore in the previous year.

Business Operations

A. Crop Care

During the year under review the Domestic Crop Care business achieved a revenue of Rs1468 crore as against Rs 1287 crore during FY 2020-21 a growth of 14%. TheInternational business achieved a revenue of Rs 787 crore during the year under review asagainst Rs 741 crore during FY 2020-21 a growth of 6.2%.

1. Crop Protection

Domestic Formulation:

India is a vast nation with high growth potential for the crop protection industry onthe back of its diverse agro-climatic conditions as well as its increasing impetuson improvements in agricultural productivity and doubling the farmer's income. India'scapability in low cost manufacturing availability of technically trained resourcesdomestic demand sufficient capacity reasonable price realisations and a strong presencein generic pesticide manufacturing are the major factors boosting the crop protection marketgrowth.

The Company registered 12.3% growth over the previous year with the help of its newproduct introductions commercial interventions supportive trade policies and byenhancing channel reach and engagement.

The agricultural sector has experienced a buoyant growth in the past two years. In FY2021-22 the sector which is the largest employer of workforce contributed to 16% inGross Value Added (GVA) of the country. As per the second Advance Estimate GVA fromagriculture forestry and _shing was estimated at Rs 39.64 lakh crore (at current price)in FY 2021-22.

As per second Advance Estimates for FY 2021-22 total food grain production in thecountry is estimated at a record 316.06 million tonnes which is 5.32 million tonnes higherthan that during FY 2020-21. The production of rice wheat and coarse cereals hasincreased at compound annual growth rates (‘CAGR') of 3.2% 2.8% and 1.5%respectively during the last five years i.e. from FY 2017-18 to FY 2021-22. The CAGR forpulses oilseeds and cotton has been 1.5% 4.2% and 0.9% respectively during the sameperiod.

The 2021 annual rainfall over the country as a whole was 99% of its Long Period Average(‘LPA‘) value for the period from 1961-2010. The Southwest monsoon season (Juneto September) rainfall was normal over Northwest India (96%) and Central India (104%).Season rainfall was below normal over East and Northeast India (88%) and above normal overSouth Peninsula India (111%). The Southwest monsoon seasonal rainfall over the monsooncore zone which consists of most of the rain-fed agriculture regions in the country wasabove normal. Out of the total 36 meteorological subdivisions 20 subdivisionsconstituting 58% of the total area of the country received normal season rainfall 10subdivisions received excess rainfall (25% of the total area) and 6 subdivisions receivedde_cient season rainfall (17% of the total area). Further the season was very uniquelyplaced in the historical record for its distinct and contrasting month-to-month variationover India as a whole. The rainfall across the country as a whole was 110% 93% 76% and135% of the LPA during June July August and September respectively.

Further the total live storage in 140 important reservoirs in different parts of thecountry during the week ended March 24 2022 was 83.523 Billion Cubic Meter (‘BCM')(47% of the storage capacity at full reservoir level) as against 78.198 BCM during thecorresponding date of the previous year and 65.421 BCM which is the average storage of thelast 10 years. Storage during the year was nearly 107% of last year's storage and 126% ofthe average of the last 10 years.

Thus during FY 2021-22 Indian agriculture experienced a relatively normal monsoon inaggregate which resulted in normal crop acreage in Kharif and increased acreage in Rabidue to better water availability. However distribution of rainfall was uneven whichresulted in crop loss and low consumption of pesticides.

In this background the Insecticides portfolio witnessed a growth of 9% over theprevious year. It has grown in key crops like Paddy Cotton Pulses Chillies and Soybean.However incessant rainfall during the peak consumption time of Cotton challenges inacceptance of granule insecticides in Paddy for Stem Borer ‘low to almost no'infestation of fall armyworms in Maize and low pest load on Rabi Pulses limited thegrowth.

The Fungicides portfolio grew 10% over the previous year. It grew in key crops likeFruits and Vegetables segment and Soybean. Continuous rainfall during the consumption and‘low to no' disease incidence in Paddy severe Chilli crop damage due to BlackThrips drastic drop in Cumin acreages etc. impacted the overall Fungicides categorynegatively. Further the consumption of high end molecules reduced in key geographieswhile the consumption of generics increased comparatively.

The Herbicide portfolio grew 26% over the previous year. The flagship brands likePanida Grande Tata Metri and Taarak registered a strong growth. However the Maizeherbicides segment was impacted due to continuous dry spell in key geographies during theKharif season. Liquidation of wheat herbicides was impacted due to unusual rains.

International Business:

The preliminary view of the global crop protection market is that it is estimated tohave increased by 8% to reach a total value of USD 65.8 billion during calendar year 2021compared to USD 60.8 billion during calendar year 2020. Overall the agrochemical marketboth crop and non-crop segments have grown to USD 73.4 billion in 2021 from USD 68.0billion in 2020.

During the year under review the market in North American Free Trade Agreement(‘NAFTA') States improved compared to the previous year benefiting from a continuingrise in maize and soybean areas and positive prices in the USA. High prices for keyagrochemicals have led to a better realisation particularly for generic productsboosting the overall value of the market. The markets in Central and South America havebeen held back somewhat by dry weather conditions and continued currency issues.Additionally the European crop protection market has also benefited from favourableagricultural conditions higher planted areas and the normalisation of inventories. In theMiddle East pest incidence generally has been less severe than in 2020 leading to aslowdown in use of insecticides. In Australia the crop protection market has benefitedfrom much improved conditions following the effects of severe drought during the previousyear particularly in the key cropping states whereas China benefited from increasedgovernment support for maize where crop protection usage is generally more and uses highercost of inputs. Asia Pacific market such as Vietnam Thailand Indonesia Philippines andMalaysia have benefited from a significant improvement in weather conditions and wateravailability. Favourable conditions for planting have generally been prevalent throughoutAfrica. In South Africa favourable weather boosted the local maize crop.

In terms of market performance 14.1% revenue growth was witnessed in Asia Pacific. Agrowth of 8.7% was witnessed in Europe 5.0% in NAFTA States 4.6% in Middle East / Africaand 4.4% in Central and South America.

During the year under review the Company's International business registered a growthof 6.2% over the previous year. Out of the total revenues recorded during the year asignificant share of 39% was witnessed in NAFTA States followed by Asia Middle EastLatin America Africa and Europe. The Company gained 17 new registrations in the overseasmarket in FY 2021-22. The Company also clocked the highest ever growth in brandedformulations sales. Developing the branded sales business in targeted countries in Africanand South East Asian regions continues to be a focal point of the Company. Simultaneouslyfuture growth is envisaged by offering Active Ingredients to the existing as well asprospective customers across the globe.

2. Crop Nutrition

The Crop Nutrition business of the Company consists of Bio fertilisers Bio stimulantsMicronutrients Water soluble fertilisers Organic fertilisers and Biopesticides.

During FY 2021-22 the Crop Nutrition business achieved an impressive growth of 20.5%.6 new products were added to the portfolio - Aquafert Cotton Aquafert Apple Ralli DermaRalli Flomonas Ralli Pecilo and GeoGain K+. All these new products were well accepted bytraders and farmers. Research and Development activities were intensified and more than 20products covering multiple segments across categories were chosen for development andcommercialisation.

While the manufacturing of a few products currently takes place at the Company's unitlocated at Akola the Crop Nutrition business follows an asset-light model whereinmultiple strategic partners and third party arrangements support its supply chain. Cropcalendar and crop life cycle based product promotion approach at territory leveldemonstrations distance marketing and promotion of integrated nutrition management andintegrated pest management continued to be implemented during the year under review.

Biopesticides:

The Biopesticides segment which the Company entered in 2021 fared encouragingly duringthe year under review. In FY 2021-22 many regions were engaged in the sale ofbiopesticides and the feedback received based on the experience of various customers hasbeen encouraging.

B. Seeds

The Seeds business is a research based operation of the Company. The Company developsproduces and distributes hybrid seeds of Paddy Maize Millet Cotton Mustard andVegetables in more than 200 territories across 15 states of the country as well as inNepal. The Company is one among the few Indian seed companies engaged in conventional andbiotechnology based research and development supported by institutional national andinternational collaborations for germplasm access.

The year was unpredictable and a challenging one for seeds particularly due to theerratic and uneven distribution of monsoon. Crop shifts Covid-19 situation erraticmonsoon illegal HTBt cotton and reduced hybridisation impacted majority of the seedsindustry players. In this backdrop the revenues of the seeds business shrunk by 13%.Despite the internal and external challenges the Company managed good realisations acrossthe crop categories which helped manage its Gross Margins. Maintaining the Covid-19 safetyprotocols throughout the year continued to be the Company's first priority along withsecuring a threshold base for its hybrids across the territories in the declining marketso as to enable the Company to grow when the market returns to normal. Its second prioritywas to remain profitable through disciplined management of fixed costs. Third priority wasto ensure availability of products for the next financial year. The Company launched 6products for different market segments of India.

The brand architecture for seeds business was revamped to emphasise the parentage andsimplify the pack designs which is being progressively rolled out. The Company alsopiloted the "One Rallis" project in the eastern part of the country a commonfront-facing operation for both crop care and seeds. The Company's supply chain continuedto focus on certainty and reliability in seeds production and operations.

Looking ahead even though the volatility and uncertainty is expected to continue thebusiness has evolved plans to emerge stronger. With its wide core product portfolio andemerging strong products in the existing and new market segments and renewed focus on costoptimisation productivity performance and people the Company envisages being able toabsorb shocks and demonstrate good performance in the seeds business.

Farmer Engagement

The Company believes in empowering the farmers and providing them with necessaryknowledge for enhancing farm prosperity. During the year under review through its FarmerEngagement Programme in both Crop Care as well as Seeds the Company undertook thefollowing initiatives:

RallisSamrudhKrishi?(‘RSK2.0'):TheCompanycontinued to follow a refreshedapproach to RSK 2.0. A bottom-up planningwasdonetoaligntheCompany'sCustomerConnectactivities with the season's progress. Engagement activities were planned and executed in3 broad categories viz. i) crop advisor led activities ii) sales team ledactivities and iii) distance marketing based initiatives.

The Company's crop advisors visited Rallis Marga Pradarshak farmers a select setof farmers on a regular basis providing solutions based on the stage and condition of thecrop. This initiative was supported by Dr. Vishwas (Company's farmer advisory helpline).These engagement initiatives were also supported by various digital interventions such associal media presence through Facebook YouTube and Instagram query & complaintresolution through Rallis Krishi Samadhan (a mobile app) etc. Progress on field levelactivities were monitored through Sampark and E-Sparsh digital platforms.

Samrudh Krishi: Samrudh Krishi (‘SK') is a weather-based agro advisoryprogramme to support grape growers. SK was initiated in FY 2011-12 and ever sincecontinuous improvements have been made. Farmers are well connected with this service sinceinception and have been reaping its benefits. During the year under review theFertigation Grape schedule i.e. "Aquafert Grapes 1st to 4th Grades" wasintroduced which is a new concept and a complete solution for grape nutrition. During FY2021-22 more than 3800 farmers have directly benefited through the SK programme. SKactivities were carried out with use of masks along with physical distancing during thepandemic. Despite pandemic-led movement restrictions continuous connection with thecustomers was maintained through digital platforms.

Drishti: Drishti is a Decision Intelligence and Crop Monitoring System whichharnesses the power of space borne remote sensing and Artificial Intelligence (AI). It isa co-development initiative between Rallis and TCS Digital Farming Initiative. During theRabi season around 1400 acres of paddy hybrid seed production fields were underDrishti's surveillance.

Drishti generates insight to the hybrid seed production team at a predeterminedfrequency speeds up the decision-making and significantly saves time and human efforts.Further its high spatiotemporal resolution of farm scan and yield monitoring processallows the Company to have near real-time monitoring of the scattered and distantproduction plots. Additionally seasonal weather forecasts and the risk advisoriesgenerated by Drishti enable the Company to select the right seed production locationminimising the loss in yield etc.

Seeds Production Programme: As part of the hybrid seed production programme theCompany is engaged with about 14000 growers from more than 1300 villages. During thehybrid seed production cycle the field team regularly guides the farmers in variousregions of Andhra Pradesh Telangana Gujarat Odisha Maharashtra and Karnataka withbetter agronomic practices as well as effective and efficient use of agricultural inputfor better profitability. The seed production programme is carried out in many tribalareas as well which helps the community to improve and uplift their skills and income.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company and its subsidiary are prepared inaccordance with Indian Accounting Standards notified under the Companies (IndianAccounting Standards) Rules 2015 (‘Ind AS'). The Audited Consolidated FinancialStatements together with the Auditor's Report thereon form part of this Integrated AnnualReport.

The Consolidated Financial Statements include financials of PT Metahelix LifesciencesIndonesia.

The Company has adopted a Policy for determining Material Subsidiaries in terms ofRegulation 16(1)(c) of the SEBI Listing Regulations. The Policy as approved by the Boardis uploaded on the Company's website at https://www.rallis.com/PolicyonMaterialSubsidiaries. A report on the financial position of PT MetahelixLifesciences Indonesia as per Section 129(3) of the Companies Act 2013 (‘the Act')is provided in Form AOC-1 which is attached to the financial statements.

The Company does not have any subsidiary associate or joint venture company as onMarch 31 2022.

Status of Subsidiary

PT Metahelix Lifesciences Indonesia (‘PT Metahelix')

PT Metahelix had received approval for cancellation of its Company Registration Numberand revocation of its business licence in March 2021. Further on March 23 2022 PTMetahelix also received a certificate for cancellation of its Tax Identification Numberand accordingly ceased to be a subsidiary of the Company effective the said date.

Credit Ratings

There were no changes in the credit ratings of the Company during the year underreview. As on March 31 2022 the Company had a short-term credit rating of CRISIL A1+ anda long-term rating of CRISIL AA+/ Stable by CRISIL Limited for bank loan facilitiesaggregating to Rs 440 crore.

Particulars of Loans Guarantees or Investments

During the year under review the Company has not made any investment. Further theCompany has not given any loan or corporate guarantee or provided any security during theyear.

Details of loans guarantees and investments covered under the provisions of Section186 of the Act are given in the notes to the Financial Statements.

Related Party Transactions

The Company formulated a Policy on Related Party Transactions in accordance with theAct and the SEBI Listing Regulations including any amendments thereto for identifyingreviewing approving and monitoring of Related Party Transactions (‘RPTs'). The saidPolicy has been revised in line with the amended SEBI Listing Regulations and the same isavailable on the Company's website at https://www.rallis.com/RPTPolicy.

All RPTs are placed before the Audit Committee for review and approval. Prior omnibusapproval of the Audit Committee is obtained on an annual basis for the transactions whichare planned/repetitive in nature. A statement giving details of all RPTs entered pursuantto omnibus approval so granted is placed before the Audit Committee on a quarterly basisfor its review specifying the nature value and terms and conditions of the transactions.All the RPTs under Ind AS-24 have been disclosed in note no. 38 to the StandaloneFinancial Statements forming part of this Integrated Annual Report.

The RPTs entered into during the year under review were on arm's length basis in theordinary course of business and were in compliance with the applicable provisions of theAct read with the rules framed thereunder and the SEBI Listing Regulations. Further theCompany did not enter into any contracts or arrangements with related parties in terms ofSection 188(1) and no material related party transactions were entered into during theyear under review. Accordingly the disclosure of RPTs as required under Section 134(3)(h)of the Act in Form No. AOC-2 is not applicable to the Company for FY 2021-22 and hencedoes not form part of this Integrated Annual Report.

In terms of Regulation 23 of the SEBI Listing Regulations the Company submits detailsof RPTs on a consolidated basis as per the format specified in the relevant accountingstandards to the stock exchanges on a half-yearly basis.

Risk Management

The Company has a well defined risk management framework in place to identifyevaluate monitor business risks and challenges across the Company as well as to identifynew and emergent risks. The Company's success as an organisation largely depends on itsability to identify opportunities and leverage them while mitigating the risks that arisewhile conducting its business.

The Risk Register is revisited periodically to ensure that the risks remain relevant atany point in time and corresponding mitigation measures are effective. This provides aproactive and value adding independent review process which enables maintaining the riskprofile at an acceptable level in a rapidly changing environment. Further for appropriateidentification and mapping of risks the Company designs a Risk Slate focussing on twoparameters – likelihood of the incident/event and its impact on the business. Risksthat fall under both these parameters are tagged as key risks for the purpose of timelytracking and preparing mitigation plans. During the year under review the Risk ManagementPolicy and Terms of Reference of the Risk Management Committee were revised in line withthe SEBI Listing Regulations to inter alia set up strategic policiesincluding focus on ESG related risks cyber security risks and defining the role andresponsibilities of the Risk Management Committee.

The Risk Management Committee is chaired by an Independent Director and the Chairpersonof the Audit Committee is also a member of the said Committee. Further the Board isapprised of any procedure that may impact the long-term plans of the Company.

The major risks forming part of the Risk Management process are linked to the audituniverse and are also covered as part of the annual risk based audit plan.

Details on the risks identified and mitigation plan are set out on Page 20 ofthe Integrated Report.

Internal Financial Controls

The Company's internal control systems are commensurate with the nature of itsbusiness the size and complexity of its operations and such internal financial controlswith reference to the Financial Statements are adequate. The Company has implementedrobust processes to ensure that all internal financial controls are workingeffectively.

Two external firms viz. Ernst & Young LLP and Mahajan & Aibara CharteredAccountants LLP were engaged to assist the Internal Auditor of the Company to oversee theinternal financial processes policies and recommend robust internal financial controlsfrom time to time for ensuring an orderly and efficient conduct of its business.Independence of the Internal Auditor is ensured by way of direct reporting to the AuditCommittee.

These internal financial controls help in safeguarding assets prevention &detection of frauds and/or errors maintaining the accuracy and completeness of theaccounting & financial records. These controls also help in the timely preparation oftransparent complete and accurate financial information and statements as per thestipulated accounting standards and principles. The Audit Committee of the Board evaluatesthe internal financial controls system periodically.

Further the Audit Committee approves and reviews the audit plan for the year based oninternal risk assessment. Audits are conducted on an ongoing basis and significantdeviations if any are brought to the notice of the Audit Committee following whichcorrective action is recommended for implementation. All these measures facilitate timelydetection of any irregularities and early remedial steps.

The Audit Committee has satisfied itself on the adequacy and effectiveness of theinternal financial controls system laid down by the Management. The Statutory Auditorshave confirmed the adequacy of the internal financial control systems over financialreporting.

Further details of the internal control systems are provided in the ManagementDiscussion & Analysis which forms part of this Integrated Annual Report.

Directors' Responsibility Statement

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company audit conducted by the Internal StatutoryCost and Secretarial Auditors including audit of the internal financial controls overfinancial reporting by the Statutory Auditors and the reviews performed by Management andthe relevant Board Committees including the Audit Committee the Board is of the opinionthat the Company's internal financial controls were adequate and operating effectivelyduring FY 2021-22.

Accordingly pursuant to Sections 134(3)(c) and 134(5) of the Act the Directors tothe best of their knowledge and ability confirm that for the year ended March 31 2022:(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed and that there are no material departures; (ii) they 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 and of the profit of the Company for thatperiod; (iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;(iv) they have prepared the annual accounts on a going concern basis; (v) they have laiddown internal financial controls to be followed by the Company and that such internalfinancial controls are adequate and are operating effectively; and (vi) they have devisedproper systems to ensure compliance with the provisions of all applicable laws and thatsuch systems are adequate and operating effectively.

Governance Compliance and Ethics

The Governance Corporate Secretarial and Legal functions of the Company ensuremaintenance of good governance within the organisation. They assist the business infunctioning smoothly by ensuring compliance and providing strategic business partnershipin the areas including legislative expertise corporate restructuring regulatory changesand governance.

The Company has also adopted the governance guidelines on Board effectiveness tofulfill its responsibility towards its stakeholders. With a view to uphold human rights asan integral aspect of doing business being committed to respect and protect human rightsand remediate adverse human rights impact resulting from or caused by the Company'sbusinesses the Board adopted ‘Business and Human Rights Policy' during the yearunder review.

In compliance with the SEBI Listing Regulations the Corporate Governance Report andthe Auditor's Certificate form part of this Integrated Annual Report.

Management Discussion & Analysis

The Management Discussion & Analysis as required under the SEBI Listing Regulationsforms part of this Integrated Annual Report.

Business Responsibility & Sustainability Report

The Company endeavours to cater to the needs of the communities it operates in therebycreating maximum value for the society along with conducting its business in a way thatcreates a positive impact and enhances stakeholder value. As per Regulation 34(2)(f) ofthe SEBI Listing Regulations as amended and in line with the SEBI Circulars dated May 52021 and May 10 2021 though voluntary for FY 2021-22 the Company has as a matter ofgood governance made disclosure in the Business Responsibility & SustainabilityReport (‘BRSR') depicting initiatives taken by the Company from an environmentalsocial and governance perspective. The BRSR forms part of this Integrated Annual Report.

Directors and Key Managerial Personnel

Re-appointment:

In accordance with the provisions of Section 152 of the Act and in terms of Article112(2) of the Articles of Association of the Company Mr. R. Mukundan Non-ExecutiveDirector of the Company retires by rotation at the ensuing AGM and being eligible offershimself for re-appointment.

Independent Directors:

Dr. Punita Kumar Sinha Dr. C. V. Natraj and Ms. Padmini Khare Kaicker IndependentDirectors of the Company have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of theSEBI Listing Regulations. In terms of Regulation 25(8) of the SEBI Listing Regulationsthey have confirmed that they are not aware of any circumstance or situation which existsor may be reasonably anticipated that could impair or impact their ability to dischargetheir duties with an objective independent judgment and without any external influence.The Board of Directors of the Company has taken on record the declaration and confirmationsubmitted by the Independent Directors after undertaking due assessment of the veracity ofthe same. In the opinion of the Board they fulfill the conditions of independence asspecified in the Act and the Rules made thereunder and are independent of the management.There has been no change in the circumstances affecting their status as IndependentDirectors of the Company.

The Board is of the opinion that all Directors including the Independent Directors ofthe Company possess requisite qualifications integrity expertise and experience in thefields of science and technology industry experience strategy finance and governanceIT and digitalisation human resources safety and sustainability etc.

The Independent Directors of the Company have confirmed that they have enrolledthemselves in the Independent Directors' Databank maintained with the Indian Institute ofCorporate Affairs (‘IICA') in terms of Section 150 of the Act read with Rule 6 of theCompanies (Appointment & Qualification of Directors) Rules 2014 as amended. They areexempt from the requirement to undertake the online proffciency self-assessment testconducted by IICA.

Details of Familiarisation Programme for the Independent Directors are providedseparately in the Corporate Governance Report.

During the year under review the Non-Executive Directors of the Company had nopecuniary relationship or transactions with the Company other than sitting feescommission and reimbursement of expenses incurred by them for the purpose of attendingmeetings of the Board/Committees of the Board.

Key Managerial Personnel (‘KMP'):

Mr. Ashish Mehta superannuated from the services of the Company as the Chief FinancialOfficer with effect from the close of business hours on June 14 2021. The Board places onrecord its appreciation for Mr. Mehta's contribution during his association with theCompany. The Board on recommendation of the Nomination & Remuneration Committee(‘NRC') and the Audit Committee appointed Ms. Subhra Gourisaria as the ChiefFinancial Officer of the Company with effect from June 15 2021.

In terms of the provisions of Sections 2(51) and 203 of the Act the following are theKMP of the Company:

Mr. Sanjiv Lal Managing Director & CEO

Ms. Subhra Gourisaria Chief Financial Officer

Mr. Yashaswin Sheth Company Secretary

Procedure for Nomination and Appointment of Directors:

The NRC is responsible for developing competency requirements for the Board based onthe industry and strategy of the Company. The Board composition analysis reflects in-depthunderstanding of the Company including its strategies environment operations financialcondition and compliance requirements.

The NRC is also responsible for reviewing the profile of potential candidatesvis-?-vis the required competencies and meeting potential candidates prior to makingrecommendations of their nomination to the Board.

At the time of appointment specific requirements for the position including expertknowledge expected are communicated to the appointee.

The Board has also reviewed the list of core skills expertise and competencies of theBoard of Directors as are required in the context of the businesses and sectors applicableto the Company which were mapped with each of the Directors on the Board. The same isdisclosed in the Corporate Governance Report forming part of this Integrated AnnualReport.

Criteria for determining Qualifications Positive Attributes and Independence of aDirector:

The NRC has formulated the criteria for determining qualifications positive attributesand independence of Directors in terms of provisions of Section 178(3) of the Act andRegulation 19 read with Part D of Schedule II to the SEBI Listing Regulations.

Independence: In accordance with the above criteria a Director will be consideredas an ‘Independent Director' if he / she meets the criteria for Independence as laiddown in the Act and Rules framed thereunder as amended and Regulation 16(1)(b) of theSEBI Listing Regulations.

Qualifications: A transparent Board nomination process is in place that encouragesdiversity of thought experience knowledge perspective age and gender. It is alsoensured that the Board has an appropriate blend of functional and industry expertise.While recommending the appointment of a Director the NRC considers the manner in whichthe function and domain expertise of the individual will contribute to the overallskill-domain mix of the Board.

Positive Attributes: In addition to the duties as prescribed under the Act theDirectors on the Board of the Company are also expected to demonstrate high standards ofethical behaviour strong interpersonal and communication skills and soundness ofjudgement. Independent Directors are also expected to abide by the ‘Code forIndependent Directors' as outlined in Schedule IV to the Act.

Annual Evaluation of Board Performance and Performance of its Committees and Directors:

Pursuant to the applicable provisions of the Act and the SEBI Listing Regulations theBoard has carried out an annual evaluation of its own performance performance of theDirectors as well as the evaluation of the working of its Committees.

The NRC has defined the evaluation criteria procedure and time schedule for thePerformance Evaluation process for the Board its Committees and Directors.

The performance of the Board and individual Directors was evaluated by the Board afterseeking inputs from all the Directors. The performance of the Committees was evaluated bythe Board after seeking inputs from the Committee Members.

The criteria for performance evaluation of the Board included aspects such as Boardcomposition and structure effectiveness of Board processes contribution in the long-termstrategic planning etc. The criteria for performance evaluation of the Committeesincluded aspects such as structure and composition of Committees effectiveness ofCommittee Meetings etc. The above criteria are broadly based on the Guidance Note onBoard Evaluation issued by the Securities and Exchange Board of India.

The Chairman of the Board had one-on-one meetings with each Independent Director andthe Chairman of the NRC had one-on-one meetings with the Executive andNon-Executive Non-Independent Directors.

ln a separate Meeting the Independent Directors evaluated the performance ofNon-Independent Directors and performance of the Board as a whole. They also evaluated theperformance of the Chairman taking into account the views of the Managing Director andNon-Executive Directors. The NRC reviewed the performance of the Board its Committees andthe Directors. The same was discussed in the Board Meeting that followed the Meeting ofthe lndependent Directors and the NRC at which the feedback received from the Directorson the performance of the Board and its Committees was also discussed. The Company followsa practice of implementing each of the observations from the annual evaluation bycalendarising its implementation through the Action Taken Report which is reviewed by theBoard of Directors from time to time.

The Annual Performance Evaluation is conducted in a paperless manner with documentsbeing securely uploaded and accessed electronically. This has resulted in saving paperreducing the cycle time of the process and increasing confidentiality of the information.

Remuneration Policy

The Company has adopted a Remuneration Policy for the Directors KMP and otheremployees pursuant to the provisions of the Act and the SEBI Listing Regulations. TheRemuneration Policy is attached as Annexure A which forms part of this Report.

Board and Committee Meetings

Regular meetings of the Board and its Committees are conducted to discuss and approvevarious strategies policies financial matters and such other businesses. A calendar ofBoard and Committee Meetings to be held during the year was circulated in advance to theDirectors.

a. Details of Board Meetings

During the year under review seven (7) Board Meetings were held details of which areprovided in the Corporate Governance Report.

b. Composition of Audit Committee

As on March 31 2022 the Audit Committee comprised four (4) Members out of which three(3) were Independent Directors and one (1) was a Non-Independent Non-ExecutiveDirector. During the year seven (7) Audit Committee Meetings were held details of whichare provided in the Corporate Governance Report.

There have been no instances during the year when recommendations of the AuditCommittee were not accepted by the Board.

c. Composition of Corporate Social Responsibility (‘CSR') Committee

During the year under review the CSR Committee comprised three (3) Members out ofwhich one (1) was an Independent Director and two (2) were Non-Independent Non-ExecutiveDirectors. During the year under review three (3) CSR Committee Meetings were helddetails of which are provided in the Corporate Governance Report.

There have been no instances during the year when recommendations of the CSR Committeewere not accepted by the Board.

Details on other committees including their composition number of meetings held andterms of reference are included in the Corporate Governance Report.

Corporate Social Responsibility

CSR and Afirmative Action (‘AA') continued to be an integral part of the businessjourney of the Company. The Company has aligned its CSR and AA strategy and operationswith Tata Chemicals Limited and Tata Chemicals Society for Rural Development(‘TCSRD'). The CSR framework of TCSRD as followed by the Company addresses a majorityof the

Sustainability goals. The leadership team at the Company has been very supportivesensitive and encourages the team to work for inclusive growth through its CSR and AAinitiatives.

During FY 2021-22 over and above its usual CSR commitments the Company also carriedout various activities towards Covid-19 relief work.

Employees are one of the key stakeholders and they extend great support to the CSR andAA initiatives by their active participation through volunteering. During the year underreview the Company has achieved more than 7960 volunteering hours through variousactivities in which 497 employees actively participated.

Under Natural Resource Management the Company has focussed on water conservationthrough rainwater harvesting (‘Jal Dhan') recharging ground water and soilconservation. Jal Dhan benefits have reached more than 2.55 lakh villagers and harvested3.28 million cubic meter water during FY 2021-22.

In Education the Company has focussed on Science English Information Technologyeducational infrastructure and initiatives for special children. The Company has beenengaged in capacity building of school teachers and has provided necessary training toteachers. The Company has also supported schools by providing teachers especially in thestream of Science English and special teachers for special children. The Company hasbranded its educational interventions as ‘RUBY' (Rallis Ujjwal Bhavishya Yojana).

The Company has also initiated scholarship support to students from economically weakersections through the Vidyasaarathi portal managed by the CSR wing of the NationalSecurities Depository Limited.

The Company under its AA Programme focussed on converting a backward Tribal Villageinto a Model Tribal Village. This initiative focussed on tribal areas around Mumbai inMaharashtra. During the year under review the Gujarat Government approached the Companyto replicate the same in the aspirational district of Narmada. The Company has identifiedand initiated work in 5 villages from Narmada district of Gujarat and continued to work in5 villages from Maharashtra catering to more than 3700 tribals.

Under the Integrated Village Development the Company focusses on Education Health andSkilling along with other developmental aspects. During the year under review theCompany identified 9 villages and 10 Gram mitras from Warangal and Karimnagar districts ofTelangana. The Company will work with TCSRD and All India Institute of Local SelfGovernance for said project.

The above projects are in accordance with Schedule VII to the Act. The Annual Report onCSR activities is attached as Annexure B which forms part of this Report.

During the year under review the Company revised its CSR Policy and Charter of theCommittee to align with the amended Companies (Corporate Social Responsibility Policy)Rules 2014. The revised Policy mainly included changes in definitions CSR expendituretreatment of surplus and setting off of excess spend guiding principles for selectionimplementation and monitoring of activities and approach direction and annual action planof the Board and CSR Committee of the Company. The CSR Policy is available on the websiteof the Company at https://www.rallis. com/csr-policy.

Policy on Prevention Prohibition and Redressal of Sexual Harassment at Workplace

The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on Prevention Prohibition and Redressal of Sexual Harassment in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 (‘POSH Act') and the rules framed thereunder. InternalCommittees have been set up to redress complaints received regarding sexual harassment.All persons whether employed as permanent contractual temporary or trainees are coveredunder this Policy. No complaints were pending at the beginning of FY 2021-22. Further theCompany did not receive any complaints of sexual harassment during the year under reviewand accordingly there were no complaints pending as at the end of the financial year. Thesaid Policy is available on the website of the Company at https://www.rallis.com/posh-policy.

As an endeavour to educate and empower the women employees within the organisationregarding POSH and their rights virtual awareness sessions were also conducted during FY2021-22.

Vigil Mechanism and Whistleblower Policy

The Company believes in the conduct of the affairs of its constituents in a fair andtransparent manner by adopting the highest standards of professionalism honestyintegrity and ethical behaviour. In line with the Tata Code of Conduct any actual orpotential violation howsoever insignificant or perceived as such would be a matter ofserious concern for the Company. The role of the employees in pointing out such violationsof the Tata Code of Conduct cannot be undermined. A Vigil Mechanism and WhistleblowerPolicy has been established for Directors and employees to approach the Chief EthicsCounsellor/ Chairperson of the Audit Committee of the Company to report instances ofunethical behaviour actual or suspected fraud or violation of the Company's Code ofConduct or policies and provides safeguards against the victimisation of employees whoavails of the mechanism. The Audit Committee reviews reports made under this Policy andimplements corrective actions wherever necessary.

Along with the ethics structure details of the third party helpline ‘IntegrityMatters' is also available on the Company's website. Further various training andawareness sessions on Code of Conduct and related policies were conducted during the yearunder review. Senior Leadership Members at various occasions emphasise the importance ofadherence to the Company's Code of Conduct and its ethical ways of working.

Details of the Vigil Mechanism and Whistleblower Policy are made available on theCompany's website at https://www.rallis. com/WhistleblowerPolicy.

Auditors

(1) Statutory Auditors:

At the 69th AGM of the Company held on June 23 2017 pursuant to the provisions of theAct and the Rules made thereunder B S R & Co. LLP Chartered Accountants (‘BSR')(Firm Registration No. 101248W/W-100022) were appointed as Statutory Auditors of theCompany from the conclusion of the 69th AGM till the conclusion of the 74th AGM to be heldin the year 2022.

The Audit Report of BSR on the Financial Statements of the Company for FY 2021-22 formspart of this Integrated Annual Report. The Report does not contain any qualificationreservation adverse remark or disclaimer.

The Board of Directors of the Company at its Meeting held on April 21 2022 based onthe recommendation of the Audit Committee re-appointed BSR as the Statutory Auditors ofthe Company pursuant to Section 139 of the Act for a second term of five (5) consecutiveyears i.e. from the conclusion of the 74th AGM till the conclusion of the 79th AGM to beheld in the year 2027 subject to approval by the Members at the ensuing 74th AGM of theCompany.

Accordingly an Ordinary Resolution proposing the re-appointment of BSR as theStatutory Auditors of the Company for a second term of five (5) consecutive years is setout in the Notice of the 74th AGM forming part of this Integrated Annual Report. TheCompany has received their written consent along with the eligibility certificateconfirming that they satisfy the criteria provided under Section 141 of the Act and thatthe re-appointment if made shall be in accordance with the applicable provisions of theAct and rules framed thereunder.

(2) Cost Auditors:

The Company is required to maintain cost records as specified by the Central Governmentas per Section 148(1) of the Act and the rules framed thereunder and accordingly theCompany has made and maintained such cost accounts and records.

In terms of Section 148 of the Act read with the Companies (Cost Records and Audit)Rules 2014 based on the recommendations of the Audit Committee the Board of Directorsappointed D. C. Dave & Co. Cost Accountants (Firm Registration No. 000611) beingeligible to conduct Cost Audits relating to the business of the Company for the yearending March 31 2023.

D. C. Dave & Co. have confirmed that they are free from disqualification specifiedunder Section 141(3) and proviso to Section 148(3) read with Section 141(4) of the Act andthat their appointment meets the requirements of Section 141(3)(g) of the Act. They havefurther confirmed their independent status and an arm's length relationship with theCompany. The remuneration payable to the Cost Auditors is required to be placed before theMembers in a General Meeting for their rati_cation. Accordingly a resolution for seekingMembers' rati_cation for the remuneration payable to D. C. Dave & Co. is included inthe Notice of the 74th AGM forming part of this Integrated Annual Report.

(3) Secretarial Auditors:

In terms of Section 204 of the Act and the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 Parikh & Associates (Firm Registration No.P1988MH009800) a firm of Company Secretaries in Practice has been appointed asSecretarial Auditors of the Company. The Report of the Secretarial Auditors is enclosed asAnnexure C which forms part of this Report. There has been no qualificationreservation adverse remark or disclaimer given by the Secretarial Auditors in theirReport.

Reporting of Frauds by Auditors

During the year under review the Statutory Auditors Cost Auditors and SecretarialAuditors have not reported any instances of frauds committed in the Company by itsofficers or employees to the Audit Committee under Section 143(12) of the Act details ofwhich are required to be mentioned in this Report.

Annual Return

Pursuant to Section 92(3) of the Act and Rule 12 of the Companies (Management andAdministration) Rules 2014 read with Section 134(3)(a) of the Act the Annual Return inForm MGT-7 as on March 31 2022 is available on the Company's website at https://www.rallis.com/MGT2022.htm.

Other Disclosures

No significant material orders have been passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations

No applications were made or any proceedings were pending against the Company underthe Insolvency and Bankruptcy Code 2016

No deposits have been accepted from the public during the year under review and noamount on account of principal or interest on deposits from the public was outstanding ason March 31 2022

There has been no change in the nature of business of the Company as on the date ofthis Report

There were no material changes and commitments affecting the financial position ofthe Company between the end of the financial year and the date of this Report

Secretarial Standards of ICSI

The Directors have devised proper systems and processes for complying with therequirements of applicable Secretarial Standards issued by the Institute of CompanySecretaries of India and that such systems were adequate and operating effectively.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 is attached as Annexure D which forms part of thisReport.

Particulars of Employees and Remuneration

The information required under Section 197(12) of the Act read with Rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is attachedas Annexure E which forms part of this Report.

The information required under Rule 5(2) and (3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 forms part of this Report. Further theReport and the Accounts are being sent to the Members excluding the aforesaid statement.In terms of Section 136 of the Act the said statement will be open for inspection uponrequest by the Members. Any Member interested in obtaining the same may write to theCompany Secretary at investorfirelations@rallis.com. None of the employees listedin the said Annexure is related to any Director/KMP of the Company.

Acknowledgements

The Directors appreciate and value the contribution dedication hard work andcommitment made by all the employees and acknowledge the support extended by them duringthese challenging times.

The Directors would also like to place on record their appreciation for the continuedco-operation and support received by the Company during the year from bankers financialinstitutions government authorities farming community business partners shareholderscustomers and other stakeholders. The Directors look forward to continuance of thesupportive relations and assistance in the future.

The Directors deeply regret the losses su_ered due to the Covid-19 pandemic and placeon record their sincere appreciation to all the front-line workers and all who have gonebeyond their duties in battling against the pandemic.

On behalf of the Board of Directors
Bhaskar Bhat
Chairman
Mumbai April 21 2022 DIN: 00148778

.