Your Directors are pleased to present the 30th Annual Report together withthe Audited Financial Statements (Standalone as well as Consolidated) for the FinancialYear ended March 31 2021.
The following figures are extracted from the financial statements prepared incompliance with Indian Accounting Standards (Ind AS). The financial statements of theCompany comply with all aspects of Ind AS notified under Section 133 of the Companies Act2013 read with the Companies (Indian Accounting Standards) Rules 2015 and other relevantprovisions of the Companies Act 2013.
(Amount in Lakhs)
| ||Standalone ||Consolidated* |
|Particulars ||31/03/2021 ||31/03/2020 ||31/03/2021 |
|Revenue from operations ||820.02 ||9978.22 ||942.73 |
|Other Income ||239.23 ||400.59 ||256.63 |
|Less: Operational & Other expenses ||759.69 ||9965.77 ||870.61 |
|Profit before exceptional items extraordinary items interest tax depreciation and amortization (EBITDA) ||299.56 ||413.04 ||328.75 |
|Less: Depreciation ||228.95 ||215.54 ||244.79 |
|Less: Finance Cost ||3.14 ||0.28 ||4.34 |
|Profit/ (Loss) Before Taxation ||67.47 ||197.22 ||79.62 |
|Less: Provision for Tax ||- ||- ||- |
|Less: Prior Years Income Tax ||0.02 ||- ||0.02 |
|Less: Provision for Deferred Tax ||(20.07) ||95.13 ||(20.21) |
|Net Profit after Tax ||87.52 ||102.09 ||99.81 |
*Raj Rajendra Industries Limited became its subsidiary w.e.f. 25th March2021 and accordingly figures are considered and comparative figures are not available.
STATE OF AFFAIRS:
On standalone basis revenue from operations for the financial year 2020-21 was Rs.820.02 Lacs as compared to Rs. 9978.22 lacs in the previous year. Earning before interesttax depreciation and amortization (EBITDA) for the year was Rs. 299.56 lacs as comparedto Rs. 413.04 lacs in the previous year. Profit after Tax (PAT) for the year was Rs. 87.52lacs as compared to Rs. 102.09 lacs in the previous year.
On consolidation basis revenue from operations for the financial year 2020-21 was Rs.942.73 lacs. Earnings before interest tax depreciation and amortization (EBITDA) for theyear was Rs. 328.75 lacs. Profit after Tax (PAT) for the year was Rs. 99.81 lacs.
CONSOLIDATED FINANCIAL RESULTS:
As stipulated by Regulation 33 of the Securities Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations 2015") the Company has prepared Consolidated Financial Statement inaccordance with the applicable accounting standards as prescribed under the Companies(Accounts) Rules 2014 of the Companies Act 2013 ("the Act"). The ConsolidatedFinancial Statement reflects the results of the Company and that of its subsidiary. Asrequired under Regulation 34 of SEBI Listing Regulations 2015 the Audited ConsolidatedFinancial Statement together with the Independent Auditors Report thereon is annexedand forms part of this Report. The summarized Consolidated Financial Statement is providedabove in Financial Highlights of this Report.
MAJOR EVENTS OCCURRED DURING THE YEAR:
a. During the financial year 2020-21 your Company has acquired 3255485 Equity Sharesof Raj Rajendra Industries Limited representing 38.30% of its paid-up capital in additionto 18.59% already held by the Company. Consequent to the completion of said acquisitionyour Company holds 56.89% in Raj Rajendra Industries Limited which is engaged in themanufacturing of Textile products. The Raj Rajendra Industries limited became a"Subsidiary Company" of the Company w.e.f. 25.03.2021.
b. The Company has filed Scheme of merger under Sections 230 to 232 and otherapplicable provisions of the Companies Act 2013 for merger by absorption of KRKumarIndustries Limited by RRIL Limited with the Honble National Company Law TribunalMumbai Bench for its approval. KRKumar Industries Limited is holder of balance equity inthe Raj Rajendra Industries Limited apart from holding interest in the land for realestate development. The merger of KRKumar Industries Limited is the part ofmanagements strategy to create value for the stakeholders and utilization ofresources available with the company in effective manner.
IMPACT OF THE COVID-19 PANDEMIC & UPDATES:
The COVID-19 pandemic has intensified into a global crisis driving the nation toenforce lock-down of all economic activity for the last few months. We remain committed tothe health and safety of our employees and their families as well as business continuityto safeguard interests of our partners customers and other stakeholders.
The rapid outbreak of corona virus (Covid-19) which has caused significant impact onthe economies of affected countries including India. As of this date the Covid-19 andconsequent lockdown have impacted on the Companys performance for the financial year2020-21. Extent of adverse impact of COVID-19 will depend on degree to which the spread ofvirus can be controlled and the level pickup in the economic activity in 2021-22.
CHANGE IN THE NATURE OF BUSINESS:
During the year your Company has continued to deal in textile products. There is nochange in the nature of Business of the Company during the period under review.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANYSINCE END OF THE YEAR TILL THE DATE OF THE REPORT:
There have been no material changes and commitments which affect the financialposition of the Company which have occurred between the end of the financial year to whichthe financial statements relate and the date of this report.
DISCLOSURES RELATING TO SUBSIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES:
1). Raj Rajendra Industries Limited Subsidiary Company:
Your Company as on 25th March 2021 has acquired 56.89% Equity Shares of RajRajendra Industries Limited. A Company having established presence in textile business.Pursuant to the provisions of Section 129(3) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 a statement containing salient features of financialstatements of subsidiaries associates and joint venture companies in Form AOC-1 isattached to the Financial Statements.
The Company has framed a policy for determining material subsidiaries which has beenuploaded on Companys website at www.rrillimited.com.
Further your Company does not have any Joint venture or Associate Company.
DIVIDEND & RESERVE:
The Board of Directors of Your Company after considering holistically the relevantcircumstances and keeping in view the Company has decided not to declare dividend any forthe year. The Board of Directors of your Company has decided not to transfer any amount tothe Reserves for the Financial Year ended 31st March 2021.
Your Company has been regular in meeting its obligation towards payment of Principal /Interest to the Banks and other institutions.
During the year under review your Company has increased its Authorised Share Capitalfrom Rs.4261.70 lacs divided into 85234000 Equity Shares of Rs. 5 each to Rs.5800.00lacs divided into 116000000 Equity Shares of Rs. 5 each by way of postal ballot dulyapproved by the shareholders of the company.
The paid - up share capital structure of the Company as on 31st March 2021is Rs. 3922.67 lacs comprising of 78453380 equity shares of Rs. 5/- each.
The Company has neither issued shares with differential rights as to the dividendvoting or otherwise nor issued sweat equity shares. There is no scheme for employee stockoption to the employees or Directors of the Company.
Your Company has not accepted any deposits within the meaning of Section 73 of the Actand the Companies (Acceptances of Deposits) Rules 2014 during the year.
INTERNAL FINANCIAL CONTROLS:
The internal control systems of your company are adequate and appropriate. It is beingreviewed periodically to ensure that the Companys interest and that of thestakeholders is protected. The process of introducing new inbuilt internal checks andcontrols is continuous depending upon the requirement of the same.
The Audit Committee of the Board reviews the adequacy and effectiveness of the internalcontrols and checks and suggests desired improvements from time to time.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):
The Companys Board comprises of a mix of executive and non-executive directorswhich is in conformity with Section 149 of the Act and Regulation 17 of the SEBI ListingRegulations 2015 with considerable experience and expertise across a range of fields suchas finance accounts general management and business strategy. The details of thedirectors and their meetings held during the year have been given in the CorporateGovernance Report which forms part of the Annual Report.
a. Changes in Directors and KMP During the year:
During the year there is no change in the Directors and KMP of the Company however OnApril 01 2021 Mr. Hiren D Chheda (DIN: 07637624) got appointed on the board of theCompany as Additional Director (Non - Executive & Non Independent Director). Theapproval of the shareholders relating to Mr. Hiren D. Chheda appointment is being soughtat the forthcoming Annual General Meeting.
As on March 31 2021 more than half of the board was Non-Executive IndependentDirectors. The detailed information with regard to the Boards composition and othergovernance matters are provided in the Corporate Governance Report which is part of thisAnnual Report.
b. Re-appointment of Directors:
In accordance with Section 152 (6) and other applicable provisions of Companies Act2013 Mr. Harsh Mehta (DIN: 08315401) being a Director is liable to retire by rotationat the forthcoming Annual General Meeting (AGM) of the Company and being eligible hasoffered himself for re-appointment. The Board recommends his re-appointment at theforthcoming AGM for your approval.
Brief profile of the directors who are appointed / re-appointed has been given in theNotice convening the Annual General Meeting.
c. Independent Directors:
The Company has received necessary declaration from all the independent directors thatthey meet the criteria of Independence throughout the year as provided under Section149(6) of the Companies Act 2013 and Regulation 16(1)(b) of the SEBI Listing Regulations2015. In the opinion of the Board the Independent Directors fulfill the conditions ofindependence specified in Section 149(6) of the Act and SEBI Listing Regulations 2015.The Independent Directors have also confirmed that they have complied with theCompanys Code of Business Conduct & Ethics.
None of the Companys Director(s) is disqualified as on March 31 2021 in termsof Section 164(2) of the Companies Act 2013 from being appointed as a Director. ACertificate to this effect duly signed by the Practicing Company Secretary is annexed tothe Corporate Governance Report which is part of this Annual Report marked as AnnexureVII.
d. Independent Directors Meeting:
As per Section 149 Schedule IV of the Companies Act 2013 and Rules made thereunderread with the SEBI Listing Regulations 2015 the Independent Directors of the Company metamongst themselves without the presence of Non-Independent Directors and members ofManagement. The details of the meeting are provided in the Corporate Governance Reportwhich is part of this Annual Report.
e. Annual Evaluation by the Board of its own performance and that of its Committees andIndividual Directors:
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 of SEBI ListingRegulations 2015 the Board has carried out the annual performance evaluation of its ownperformance the directors individually as well as the evaluation of the working of itsvarious committees as per the criteria laid down by the Nomination and RemunerationCommittee. A structured questionnaire was prepared after taking into consideration inputsreceived from the directors covering various aspects of the Boards functioning suchas adequacy of the composition of the Board and its Committees Board culture executionand performance of specific duties obligations independence governance ethics andvalues adherence to corporate governance norms interpersonal relationships attendanceand contribution at meetings etc.
A separate exercise was carried out to evaluate the performance of individual directorsincluding the Chairperson of the Board who were evaluated on parameters such asparticipation and contribution by a director commitment including guidance provided tothe senior management outside of Board / committee meetings effective deployment ofknowledge and expertise effective management of relationship with various stakeholdersindependence of behaviour and judgment etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of theChairperson and Managing Director was carried out by the Independent Directors. The Boardreviewed the evaluation results as collated by the Nomination and Remuneration Committee.
f. Number of Meetings of the board of directors:
The Board unites at regular intervals to discuss and decide on Companys businesspolicies and strategies apart from other agenda items. The Board met Eight (8) timesduring the year under review details of which are given in the Corporate GovernanceReport which is part of this Annual Report. The maximum gap between any two meetings didnot exceed one hundred and twenty (120) days.
g. Committee of the Board:
The Companys Board has the following Committees:
I. Audit Committee
II. Nomination and Remuneration Committee
III. Stakeholders Relationship committee
The details of composition of the said Committee(s) their terms of reference meetingsheld and attendance of the Committee members thereat during the financial year 2020-21are provided in the Corporate Governance Report which is part of this Annual Report.
DISCLOSURE REGARDING COMPANYS POLICIES UNDER THE COMPANIES ACT 2013: NOMINATIONAND REMUNERATION POLICY:
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.The Policy broadly lays down the guiding principles philosophy and the basis for paymentof remuneration to Executive and Non-executive Directors (by way of sitting fees andcommission) Key Managerial Personnel Senior Management and other employees. The policyalso provides the criteria for determining qualifications positive attributes andIndependence of Director and criteria for appointment of Key Managerial Personnel / SeniorManagement and performance evaluation which are considered by the Nomination andRemuneration Committee and the Board of Directors while making selection of the person.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
The Company has a Whistle Blower Policy to report genuine concerns or grievances &to provide adequate safeguards against victimization of persons who may use suchmechanism. The Whistle Blower Policy has been posted on the website of the Company atwww.rrillimited.com.
FAMILIARIZATION / ORIENTATION PROGRAM FOR INDEPENDENT DIRECTORS:
The Independent Directors attend a Familiarization / Orientation Program on beinginducted into the Board. Further various other programmes are conducted for the benefitof Independent Directors to provide periodical updates on regulatory front industrydevelopments and any other significant matters of importance.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant Section 134(3)(c) of the Act; the directors confirm that:
a) In preparation of the annual accounts for the year the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures if any;
b) The directors had 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 at the end of the financial year & ofthe Profit of the Company for that period.
c) The directors had taken proper and sufficient care towards the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.
d) The directors had prepared the annual accounts on a going concern basis.
e) The directors had laid down internal financial controls which are adequate and wereoperating effectively; and
f) The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and such systems are adequate and operating effectively.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All contracts / arrangements / transactions with related parties that were executed inFY 2020-21 were in the ordinary course of business and at an arms length. Allrelated party transactions are mentioned in the notes to the accounts. Requisite priorapproval from the Audit Committee of the Board of Directors was obtained for Related PartyTransactions. The disclosure of Related Party Transactions in Form AOC-2 as per theprovisions of Sections 134(3)(h) and 188 of the Companies Act 2013 read with Rule 8(2) ofthe Companies (Accounts) Rules 2014 is attached as Annexure VIII.
AUDITORS AND AUDITORS REPORT:
a. STATUTORY AUDITORS:
M/s Subramanian Bengali & Associates Statutory Auditors of your Company having(ICAI Firm Registration No.127499W) who have been appointed at the 26th AnnualGeneral Meeting of the Company held on September 29 2017 for a period of 5 years up tothe conclusion of 31st Annual General Meeting to be held in the year 2022 on aremuneration mutually agreed upon by the Board of Directors and the Statutory Auditors.
The Auditors Report on the financial statements of the Company for the financialyear ending March 31 2021 is unmodified i.e. it does not contain any qualificationreservation or adverse remark. The Auditors Report is enclosed with the financialstatements forming part of the annual report.
b. SECRETARIAL AUDITOR AND OBSERVATION:
Pursuant to the provisions of Section 204 of the Companies Act 2013 the Board ofDirectors have appointed M/s. Shreyans Jain & Co. Company Secretaries Mumbai as aSecretarial Auditor of the Company for conducting Secretarial Audit of Company for thefinancial year 2020-21. The Report of the Secretarial Audit in Form MR-3 is herebyattached with this Report & forming part of this report marked as "AnnexureI".
The observation made by secretarial auditor are self-explanatory in nature and thedelay occurred was due to lockdown imposed to contain the spread of Covid-19 by Govt. ofIndia.
Pursuant to the SEBI circular vide no. CIR/CFD/CMD/1/27/2019 dated February 8 2019the Company has submitted the Annual Secretarial Compliance Report issued by M/s.Shreyans Jain & Co. Company Secretaries with the stock exchanges where shares of theCompany are listed.
MANAGEMENT DISCUSSION AND ANALYSIS:
The Managements Discussion and Analysis Report for the year under review asstipulated under Regulation 34 SEBI Listing Regulations 2015 is hereby attached withthis Report & forming part of this report marked as "Annexure II".
REPORTING OF FRAUDS:
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and / or Board under Section 143(12)of Act and Rules framed thereunder.
DISCLOSURE PERTAINING TO THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIONAND REDRESSAL) ACT 2013:
The Company is committed to provide safe and conducive environment to its employeesduring the year under review. Your Directors further states that during the year underreview there were no cases filed pursuant to the sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.
SAFETY HEALTH AND ENVIRONMENT:
Your Company is committed to ensure a sound Safety Health and Environment (SHE)performance related to its activities products and services. Your Company had beencontinuously taking various steps to develop and adopt Safer Process technologies forBusiness operations. Your Company is taking continuous efforts for the adoption of safe& environmental friendly production process. Monitoring and periodic review of thedesigned SHE Management System are done on a continuous basis.
BUSINESS RESPONSIBILITY REPORT:
The Business Responsibility Report as required by Regulation 34(2) of the SEBI ListingRegulations 2015 is not applicable to the company.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS ANDOUTGO:
Report under Section 134 (3) (m) of the Companies Act 2013 read with Rule 8(3) of theCompanies (Accounts) Rules 2014 pertaining to the Conservation of Energy and TechnologyAbsorption is not applicable to the Company. There was no foreign exchange inflow or outgoduring the year under review.
DISCLOSURE AS PER RULE 5 OF THE COMPANIES (APPOINTMENT & REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014:
Disclosures required under Section 197(12) read with rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is marked as"Annexure III" forming part of this report. The aforesaid Annexure is alsoavailable for inspection by Members at the Registered Office of the Company 21 daysbefore and up to the date of the ensuing Annual General Meeting during the business hourson working days. Further the Company does not have any employee whose remunerationexceeds the limits prescribed in rule 5(2) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014.
COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company has devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards issued by the Institute of Company Secretaries of India(ICSI) and that such systems are adequate and operating effectively.
ELECTRONIC ANNUAL REPORT:
In view of the continuing Covid-19 pandemic the MCA has vide its circular dated May05 2020 read with circulars dated April 08 2020 April 13 2020 and January 13 2021(collectively referred to as "MCA Circulars") permitted the Annual Report to besent through electronic mode accordingly electronic copies of the Annual Report for thefinancial year 2020-21 and Notice of the AGM are sent to all shareholders whose emailaddresses are registered with the Company. Members are requested to register their emailids with Company or Registrar and Share Transfer Agent (RTA) of the Company for receivinge-copies of Annual Report Notice to the AGM and other shareholders communication.
As required under Section 134(3)(a)of the Act the Annual Return is put up on theCompanys website and can be accessed At www.rrillimited.com.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY:
The Details of loans guarantees and investments covered under the provision of Section186 of the Companies Act 2013 are given in the notes to Financial Statements forming apart of this annual report.
CORPORATE GOVERNANCE & CERTIFICATE:
As per Regulation 34(3) read with Schedule V of the SEBI Listing Regulations 2015 aseparate section on corporate governance practices followed by the Company and marked as "AnnexureIV" together with a certificate from the Practicing Company Secretary confirmingcompliance forms an integral part of this Report marked as "Annexure V".
Further in compliance of Regulation 17(5) of the SEBI Listing Regulations 2015 yourCompany has adopted a Code of Conduct and Ethics for its Directors and SeniorExecutives.
The Chief Financial Officer gives quarterly certification on financial results beforethe Board in terms of Regulation 33(2) of the SEBI Listing Regulations 2015. The ChiefFinancial Officer of the Company also gives Annual Certification on financial statementsand other matters as required under Regulation 17(8) of the SEBI Listing Regulations 2015is hereby attached with this Report & forming part of this report marked as "AnnexureVI".
CORPORATE SOCIAL RESPONSIBILITY POLICY:
During the year under review the Company has not developed the policy on CorporateSocial Responsibility as the Company does not fall under the prescribed classes ofCompanies mentioned under section 135(1) of the Companies Act 2013.
SIGNIFICANT AND MATERIAL ORDERS PAASED BY THE REGULATOR OR COURTS:
There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.
ENHANCING SHAREHOLDERS VALUE:
Your Company believes that its Members are its most important stakeholders.Accordingly your Companys operations are committed to the pursuit of achieving highlevels of operating performance and cost competitiveness consolidating and building forgrowth enhancing the productive asset and resource base and nurturing overall corporatereputation. Your Company is also committed to creating value for its other stakeholders byensuring that its corporate actions positively impact the socioeconomic and environmentaldimensions and contribute to sustainable growth and development.
Statements in this Directors Report and Management Discussion and Analysis Reportdescribing the Companys objectives projections estimates expectations orpredictions may be "forward-looking statements" within the meaning of applicablesecurities laws and regulations. Actual results could differ materially from thoseexpressed or implied. Important factors that could make difference to the Companysoperations include changes in Government regulations Tax regimes economic developmentswithin India and the countries in which the Company conducts business and other ancillaryfactor.
Your Directors place on record their sincere gratitude for the assistance guidance andco- operation the Company has received from all stakeholders. The Board further places onrecord its appreciation for the dedicated services rendered by the employees of theCompany.
For and on behalf of the Board of
Ratanchand D. Jain
Chairman and Managing Director