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Shree Rama Multi-Tech Ltd.

BSE: 532310 Sector: Industrials
NSE: SHREERAMA ISIN Code: INE879A01019
BSE 00:00 | 01 Feb 11.31 0.23
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NSE 00:00 | 01 Feb 11.25 0.15
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OPEN 11.10
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VOLUME 7753
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Mkt Cap.(Rs cr) 72
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OPEN 11.10
CLOSE 11.08
VOLUME 7753
52-Week high 18.20
52-Week low 9.53
P/E
Mkt Cap.(Rs cr) 72
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Shree Rama Multi-Tech Ltd. (SHREERAMA) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the 28th Annual Report on the businessand operations of the Company together with Audited Financial Statements for the financialyear ended March 31 2022.

FINANCIAL RESULTS

The Company's financial performance for the year ended March 312022 is summarizedbelow:

(Rs. in Lakhs)
2021-22 (Current year) 2020-21 (Previous Year)
Revenue from Operations 15031.47 13580.13
Other Income 42.07 20.17
Total Income 15073.54 13600.30
Profit Before Depreciation Amortization Finance Costs and Tax 238.46 1199.29
Depreciation and amortization expense 665.07 767.83
Finance Costs 65.62 88.16
Profit/(Loss) before tax (492.23) 343.30
Tax Expenses 0.00 0.00
Net Profit/(Loss) for the year (492.23) 343.30

OPERATIONAL REVIEW

Your Company's total revenue from operations during the year under review wasRs.15031.47 lakhs as compared to Rs.13580.13 lakhs of previous year which shows anincrease of 10.69% over the previous year figure. The other income was Rs.42.07 lakhsduring the year under review. The EBIDTA of the Company during the year was Rs.238.46lakhs. The loss for the Financial Year 2021-22 was Rs.492.23 lakhs. The reasons for theloss during the year as compared to last year is mainly due to increase in the cost of rawmaterial transportation cost low margin and stiff competition in the market includingthe effect of Covid 19 pandemic.

OVERVIEW OF PACKAGING INDUSTRY IN INDIA

The polymer packaging industry contributes substantially to the GDP growth in India andat the same time support the consumer-led industries such as FMCG and pharma key sectorsfor growth in India with reliable of packaging solutions.

The Indian packaging industry's market size at Rs.2050-2100 billion in fiscal 2022growing at CAGR 6.4-7.0% from fiscal 2017. Polymer packaging which form two-thirds of theindustry by revenue grew 6% during the year. The paper packaging segment also witnessed astrong 11.8% CAGR revenue growth. on the other hand metal and glass packaging witnessed amoderate 6.7% and 2.4% growth respectively during fiscal 2017-2021. Demand for packagingsegments comes from food packaging and pharma segments.

Over fiscals 2022-2027 as per expectation the industry to log 7-8% CAGR on the back ofhealthy volume growth driven by polymer paper and metals packaging segments. Thepharmaceutical industry chemical food product and personal care sectors are expected tobe the key growth drivers. Fast-moving consumer goods (FMCG) companies' increasing focuson innovative packaging solutions that offer scope for enhanced aesthetic value andextended shelf life will also propel demand

Polymers have emerged as the most preferred packaging material with 65-70% share inoverall packaging. The segment has clocked 6% CAGR between fiscal 2017-2021 followingpaper packaging which saw higher 11.8% CAGR. Metal packaging witnessed 6.7% CAGR duringthe period and glass 2.4% CAGR.

In terms of end-user industries the pharma and food product segments witnessed a rapid8.5% and 7.1% CAGR during the period of fiscal 2017-2022 driving demand for packaging.The personal care (2.3% CAGR) and industry chemical segments 5.8% CAGR also supported theoverall industry demand. Traditionally robust growth in demand for FMCG products has beenthe key driver for the packaging sector. FMCG companies' focus on rural markets hasboosted demand for polymer packaging especially for pouches and sachets.

Flexible packaging comprises BOPP HDPE and PP bags and rigid packaging includes HDPEcontainers PP containers and jars and PET bottles. There has been a significant shift inpreference from rigid to flexible packaging owing to convenience of use and lower cost.Introduction of new solutions such as laminated pouches and sachets has helped increasethe share of flexible packaging over time.

Over the next three fiscals the rigid packaging segment's revenue is expected to loghigher growth rate that of flexible packaging largely backed by volume growth and demandfrom food products and FMCG sectors. Growth in flexible packaging is expected to beslightly higher than rigid packaging driven by increased use of BOPP in the form ofpouches and sachets to package food products personal care products etc.

The Key growth drivers for packaging industry are Growth prospects of end-user sectorsincreasing rural demand for small packaged goods Expected growth in organized retail ande-commerce industry Better affordability levels health-conscious nature of consumers andDemand for innovative product solutions and sustainable packaging.

 

*Source: CRISIL Industry Report

COVID-19 AND FISCAL 2022 GDP GROWTH

India is getting back on its feet slowly with divergent growth trends. Though datasuggests there has been some pick-up in recent months recovery is weak and uneven. Andindeed the scars of the pandemic continue to run deep for small businesses the urbanpoor and most of the services sector.

Fiscal 2022 is also seen as a story of two halves - the first half characterised by abase effect- driven recovery amid the challenges associated with resurgence in Covid-19infections and the second half seeing a more broad-based growth as vaccine rollout andless stringent nationwide restrictions supporting lagging sectors. The gains made by theeconomy in the fourth quarter of fiscal 2021 seem to have fizzled out in the first quarterof fiscal 2022 because of the fierce second wave leading to localised lockdowns in moststates.

As per the second advance estimates released by the National Statistical Office on 28thFeb 2022 India's real gross domestic product (GDP) is set to grow 8.9% in this fiscalcompared with 9.2% estimated in January. This is largely a reflection of a higher base (asthe economy had shrunk 6.6% in fiscal 2021 less than 7.3% previously estimated). In factthe estimate for fiscal 2022 real GDP in absolute terms at Rs.147.7 trillion is marginallyhigher than Rs.147.5 trillion estimated earlier suggesting that the downside from theomicron variant of Covid-19 has proven to be mild so far. But it is also noteworthy thatgiven the large output loss last fiscal GDP is still only 1.8% above the pre-pandemic(fiscal 2020) level.

DIVIDEND

During the year under review your company has incurred a loss of Rs.492.23 lakhsconsidering the loss incurred by the company your Board of Directors consider it prudentnot to recommend any dividend for the Financial Year 2021-22 and no amount has beentransferred to reserves for the year under review.

SHARE CAPITAL

The paid up equity share capital of the company as at March 31 2022 was Rs.3176.03lakhs. During the year under review the Company has not issued any shares withdifferential voting rights as to dividend voting or otherwise nor has granted any stockoptions or sweat equity. As on March 31 2022 none of the Directors of the Company holdany instruments convertible into Equity shares of the Company.

SUBSIDIARY COMPANIES

Shree Rama (Mauritius) Limited was incorporated as wholly owned subsidiary inMauritius. The current status of the Company is "Defunct". There are noassociate companies or joint venture companies within the meaning of Section 2(6) of theCompanies Act 2013.

DEPOSITS

The Company does not have "Deposits" as contemplated under Chapter V of theCompanies Act 2013. Further the Company has not invited or accepted any such depositsduring the year and there is no outstanding balance as on March 31 2022.

CREDIT RATING

The credit facilities of the company are Rated by CRISIL Limited. During Financial Year2021 -22 the Rating of the company has been reviewed by CRISIL Limited for the bank loanfacilities for Rs.80 Cr. as 1) Long-Term Rating-CRISIL BBB-/Stable (Reaffirmed) and 2).Long-Term Rating- CRISIL AA (CE) /Negative (Reaffirmed).

ANNUAL RETURN

The Annual Return of the Company as on 31st March 2022 in Form MGT - 7 inaccordance with Section 92(3) of the Act read with the Companies (Management andAdministration) Rules 2014 is available on the website of the Company athttps://srmtl.com

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Smt. Vandana C. Patel Director (DIN: 00076715) retiresby rotation at the forthcoming Annual General Meeting and being eligible offers herselffor re-appointment. The Board recommends her re-appointment for the consideration of themembers of the Company at the ensuing Annual General Meeting.

During the year under review Smt. Vandana C. Patel resigned from the designation ofIndependent Director from the Board of the Company with effect from 16thDecember 2021 due to ineligibility of her to continue as Independent Director on theBoard of the Company as she is employee of promoter group entity of the Company pursuantto the SEBI (LODR) (Third Amendment) Regulations 2021 dated 3rd August 2021and SEBI Corrigendum dated 6th August 2021 and to continue her asNon-Executive Director liable to retire by rotation including her being a Woman Directoron the Board of Director of the Company which was approved by the Board of Directors inits meeting held on 16th December 2021. Further Smt. Vandana C. Patel has alsoresigned with effect from 16th December 2021 as member of Audit Committee ofthe Board of Directors.

Further your Company has received declarations from the Independent Directorsconfirming that they meet with the criteria of Independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 & the Companies (Appointmentand Qualification of Directors) Rules 2014 and under Regulation 25(8) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and there has been no change inthe circumstances which may affect their status as an Independent Director during theyear.

During the year the Board of Directors has in its meeting held on 16thDecember 2021 restructured its composition of Board of Directors by appointment of ShriMittal K. Patel (DIN: 03619139) as Regular Chairman of the Company from category ofNon-Executive NonIndependent Director in place of Shri Shailesh K. Desai (DIN: 01783891)in order to comply the regulation 17 of SEBI (LODR) Reg. 2015 relating to the Compositionof Board of Director of the Company.

As required under Regulation 36(3) of the Listing Regulations particulars of Directorsseeking appointment/re-appointment at the ensuing Annual General Meeting are annexed tothe notice convening Twenty-eight Annual General Meeting.

None of the Non-Executive Directors of the Company had pecuniary relationship ortransactions with the Company (except sitting fees for attending Board Meetings) duringthe year under review.

Pursuant to Section 203 of the Companies Act 2013 the whole-time Key ManagerialPersonnel of the Company as on March 312022 are as under:

1. Shri Shailesh K. Desai : Managing Director
2. Shri Hemal R. Shah : Whole Time Director
3. Shri Krunal G. Shah : Chief Financial Officer
4. Shri Sandip Mistry : Company Secretary

NUMBER OF MEETINGS OF THE BOARD

During the Financial Year ended on March 31 2022 the Board met six times the detailsof Board Meetings and attendance of Directors are given in the Corporate Governance Reportthat forms part of this Annual Report. The intervening gap between any two consecutivemeetings of Board was not more than one hundred and twenty days.

COMMITTEES OF BOARD

The Company has following Committees of the Board as on March 31 2022 pursuant toapplicable provisions of the Companies Act 2013 and rules made there under as well as incompliance with SEBI (LODR) Regulations 2015:

(i) Audit Committee

(ii) Nomination and Remuneration Committee

(iii) Stakeholders Relationship Committee

(iv) Rights Issue Committee

The details of composition meetings and attendance of members of committees heldduring the year are given in the Corporate Governance Report that forms part of thisAnnual Report.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and as per the corporategovernance requirements as prescribed under SEBI (LODR) Regulations 2015 the Board ofDirectors had carried out the performance evaluation of working of the Board Committees aswell as evaluation of Independent Directors including the performance of IndependentDirectors and assessment of their independence criteria and their independence from themanagement. The Board of Directors also reviewed the criteria for the purpose ofevaluation of performance of Independent Directors of the Company as well as Board ofDirectors of the Company. The Independent Directors met on 28th March 2022without the attendance of Non-Independent Directors and members of the Management. TheIndependent Directors reviewed the performance of non-independent directors and the Boardas a whole; the performance of the Chairperson of the Company taking into account theviews of Executive Directors and Non-Executive Directors and assessed the qualityquantity and timeliness of flow of information between the Company Management and theBoard that is necessary for the Board to effectively and reasonably perform their duties.The Nomination and Remuneration Committee of the Company had also carried out performanceevaluation of every Director's performance. A structured questionnaire was prepared aftertaking into consideration the various aspects of evaluation. The Board of Directorsexpressed its satisfaction with the evaluation process.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act 2013 your Directors to the best oftheir knowledge and belief and according to the information and explanations obtained bythem state that:

a) in the preparation of the annual accounts for the year ended on March 312022 theapplicable accounting standards have been followed along with proper explanation relatingto material departures;

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 for the year ended on March 31 2022 andof the loss of the Company for that period.

c) the Directors had 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;

d) the Directors had prepared the annual accounts on a going concern basis; and

e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

f) the Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

RELATED PARTY TRANSANCTIONS

All transactions entered with related parties for the year under review were on arm'slength basis and in the ordinary course of business of the Company and there were nomaterial contracts or arrangement or transactions entered into in terms of Section 188 ofthe Companies Act 2013 and accordingly the disclosure of related party transactions asper Section 134(3)(h) of the Companies Act 2013 in Form AOC-2 is not provided. Furtherthe disclosures in compliance with Para A of Schedule V of Regulation 34(3) of SEBI (LODR)Regulations 2015 is provided in the notes to the accounts. The related party transactionsas required to be disclosed under Indian Accounting Standards (Ind-AS 24) are set out inthe notes to the financial statements.

The Audit Committee had given prior omnibus approval for the related party transactionswhich were of repetitive nature and/or entered in the ordinary course of business and onarm's length basis and a statement giving details of all related party transactions wereplaced before the Audit Committee and the Board for review and noting on a quarterlybasis.

The policy on Related Party Transactions duly revised and approved by the Board ofDirectors has been uploaded on the website of the Company viz. www.srmtl.com. None of theDirectors has any pecuniary relationship or transactions vis-a-vis the Company.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY

During the year 2021-22 the Company has not given any loans or provided guarantee orsecurity in connection with a loan to other body corporate or person or made investmentsas contemplated under the provisions of Section 186 of the Companies Act 2013 hence thedetails are not provided.

POLICIES

The updated policies adopted by the Company as per statutory and governancerequirements are uploaded on website of the Company at viz. www.srmtl.com.

INTERNAL FINANCIAL CONTROL SYSTEM

The Company's internal control system is commensurate with its size scale andcomplexities of its operations. Your Company has an effective internal control andrisk-mitigation system which are constantly reviewed assessed and strengthened with new/revised standard operating procedures considering the existing system and future planningas envisaged. The internal audit is entrusted to M/s Ramesh C. Sharma & Co. CharteredAccountants and the scope of the internal audit are reviewed and revised as required toassess the risks and business processes besides benchmarking controls with best practicesin the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Company has a robust Management Information System which is an integral part ofthe control mechanism.

The Audit Committee Statutory Auditors and the business heads are quarterly apprisedof the internal audit findings and the corrective actions taken. Audit plays a key role inproviding assurance to the Board of Directors. The significant audit observations andcorrective actions taken by the management are presented to the Audit Committee of theBoard. To maintain its objectivity and independence the Internal Auditor reports to theChairman of the Audit Committee.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

The statement showing particulars with respect to the conservation of energytechnology absorption and foreign exchange earnings and outgo stipulated under Section134(3)(m) of the Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules2014 as amended from time to time is annexed herewith as "Annexure A" asa part to this Report.

PARTICULARS OF EMPLOYEES

The Company has continued to maintain harmonious and cordial relations with itsofficers supervisors and workers enabling the Company to maintain the pace of growth.Training is imparted to employees at all levels and covers both technical and behavioralaspects.

The details of Managerial Remuneration as required under Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is annexed herewith as "Annexure B" asa part to this Report. There was no employee drawing an annual salary of Rs.102 lakhs ormore where employed for full year or monthly salary of Rs.8.50 Lakhs or more whereemployed for part of the year and therefore no information pursuant to the provisions ofRule 5(2) & 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is required to be given.

NOMINATION AND REMUNERATION POLICY

The Board of Directors has on recommendation of the Nomination and RemunerationCommittee framed a Nomination and Remuneration Policy pursuant to the provisions ofSection 178 of the Companies Act 2013 read with the Rules made thereunder as well as SEBI(LODR) Regulations 2015. The policy has been placed on the website of the Company viz.www.srmtl.com. The salient features of the said policy are stated in the CorporateGovernance Report that forms part of this report.

AUDITORS & AUDITORS' REPORT

Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rulesframed thereunder M/s Chandulal M. Shah & Co. (FRN: 101698W) Chartered AccountantsAhmedabad were appointed as Statutory Auditors of the Company for the period of five yearsfrom the conclusion of the Twenty-third AGM of the Company till the conclusion of theTwenty-eighth AGM.

Further the Members of the Audit Committee Meeting held on 21.05.2022 recommended theappointment remuneration and terms of appointment of new Statutory Auditors M/S. M N Shah& Co Chartered Accounts (FRN: 105775W) for the period of 5 years from F.Y. 2022-23 inplace of retiring statutory auditor's M/S Chandulal M. Shah & Co. Chartered Accountswhose term is expiring at the conclusion of 28th AGM and who has express theirintention not to re-appoint due to their professional pre-occupation. The Company hasreceived a letter from M/s M N Shah & Co Chartered Accounts to the effect that theirappointment is within the prescribed limits under Section 141 of the Companies Act 2013read with rules made thereunder and that they are not disqualified for such appointment.

During the year under review there are no instances of frauds as reported by theauditors under Section 143(12) the Companies Act 2013 and its rules made thereunder.

The Statutory Auditors of the Company has made certain observations in the audit reportand qualified the report during the year under review. In this regard the Board clarifiesthe same as under:

Boards' Comments on Auditors Emphasis:

1. Regarding the non-provision of interest on borrowings in form of Loans anddebentures:

The management has already initiated settlement with the lenders of the loan anddebentures as per the Scheme of Arrangement and Compromise long back. The lendersspecified in the scheme have given their consent for settlement as per the terms of thescheme and in the opinion of the management the amount of dues payable to lenders havebeen specified under the definition of "Settled Debt" under clause (r) of Part 1of the scheme therefore no further liability on account of interest will arise. TheHon'ble High Court of Gujarat has passed an order on 20th February 2020whereby the O.J Appeal has been dismissed. The Company has filed Review Application on02/11/2020 before the Hon'ble High Court of Gujarat. In case the scheme is not approved orapproved with different terms the company will give necessary accounting effect on finalascertainment of the same.

2. Regarding Non consolidation of accounts of Shree Rama Mauritius Limited (WOS):

In respect of the investment made in Shree Rama (Mauritius) Limited its Wholly-OwnedSubsidiary (WOS) the resident directors & key managerial personnel of the said WOShad resigned in the year 2005-06 and audited accounts for the year ended 30thSeptember 2003 and onwards could not be prepared and provided. Its present status is shownas ‘defunct' under respective laws. The Company has accordingly provided fordiminution in the value of investments in the earlier years.

In view of the above it was not possible to prepare consolidated financial statementsas required by Ind AS 110 issued by ICAI and other provisions of the Companies Act 2013.

SECRETARIAL AUDIT

Pursuant to provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Boardhad appointed M/s Chirag Shah & Associates Practicing Company Secretaries toundertake the Secretarial Audit of the Company for the Financial Year 2021-22. TheSecretarial Audit Report is annexed herewith as "Annexure C" as a part tothis Report.

There are some observations made by the Secretarial Auditor in their report for whichthe Board of Directors hereby give its comments/ explanation as under:

(i) Regarding Non-consolidation of accounts of Shree Rama (Mauritius) Limited (WOS):

In respect of the investment made in Shree Rama (Mauritius) Limited its Wholly-OwnedSubsidiary (WOS) the resident directors & key managerial personnel of the said WOShad resigned in the year 2005-06 and audited accounts for the year ended 30thSeptember 2003 and onwards could not be prepared and provided. Its present status is shownas ‘defunct' under respective laws. The Company has accordingly provided fordiminution in the value of investments in the earlier years.

In view of the above it was not possible to prepare consolidated financial statementsas required by Ind AS 110 issued by ICAI and other provisions of the Companies Act 2013.

(ii) Regarding pending redemption of 666666 15% Cumulative Preference Shares

The Composite Scheme of Compromise and Arrangement with its lenders and Shareholdersu/s 391 of the Companies Act 1956 filed with Hon'ble High Court of Gujarat beforedivision bench has been dismissed by Hon'ble High court vide its order dated 20thFebruary 2020. The

Company has filed Review Application on 02/11/2020 before the Hon'ble High Court ofGujarat and matter of redemption of preference shares along with dividend etc. is alsocovered in the scheme. The Board is of the view that the said matter will be sorted out onfinal outcome of the scheme.

Further in addition to above the Preference Shareholder has waived the right toreceive the dividend accumulated on the Preference Shares and accumulated interest ondelayed payment provided that the Company redeems the outstanding preference shares by 31stJuly 2022 or such other extended date permitted by the Preference Shareholder at his solediscretion.

(iii) Regarding non-reversal of provision of dividend and non-transfer of the saidamount to IEPF

In the Scheme of Compromise and Arrangement the issue of waiver of unpaid dividend onpreference shares is also covered. Further Hon'ble High court vide its order dated 20thFebruary 2020 has dismissed the O J Appeal and the Company has filed ReviewApplication on 02/11/2020 before the Hon'ble High Court of Gujarat. The Board is of theview that the said matter will be sorted out on final outcome of the scheme.

M/s Chirag Shah & Associates Practicing Company Secretaries has undertaken theAnnual Secretarial Compliance Audit for the Financial Year 2021-22 pursuant to Regulation24A of SEBI (LODR) Reg. 2015. There were no observations for the period under review.

COST AUDITOR

As per the requirements of the Section 148 of the Act read with the Companies (CostRecords and Audit) Rules 2014 as amended from time to time your Company is required tomaintain cost records and accordingly such accounts are made and records have beenmaintained relating to the product group ‘Plastics and Polymers' during the yearunder review. The Board of Directors on the recommendation of Audit Committee hasre-appointed M/s Maulin Shah & Associates Cost Accountants (Firm Registration Number101527) as Cost Auditor to audit the cost records of the Company for the Financial Year2022-23. As required under the Act a resolution seeking member's approval for theremuneration payable to the Cost Auditor forms part of the Notice convening the AnnualGeneral Meeting for their ratification.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the year the Company does not fall under the criteria prescribed under Section135(1) of Companies Act 2013 read with rules made thereunder hence the Board has notconstituted Corporate Social Responsibility Committee and therefore the Company is notrequired to comply with the provisions of the Corporate Social Responsibility prescribedunder the Companies Act 2013. Accordingly the details in the Annual Report on the CSRactivities is not provided as an annexure to this Report.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report on operations of the Company as requiredunder Regulation 34(3) read with Para B of Schedule V of SEBI (LODR) Regulations 2015 isprovided in a separate section and forms an integral part of this Annual Report.

CORPORATE GOVERNANCE REPORT

The Report on Corporate Governance as stipulated under Regulation 34(3) read with ParaB of Schedule V of SEBI (LODR) Regulations 2015 forms an integral part of this Report.The requisite certificate from the Practicing Company Secretary of the Company confirmingcompliance with the conditions of corporate governance is attached to this report onCorporate Governance.

INSURANCE

The assets of the Company are adequately insured to take care of any unforeseencircumstances.

MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year of the Company to which thefinancial statements relate and the date of the report.

RISK MANAGEMENT

The risk is the part and partial of every business and the risk management is embeddedin your Company's operating framework. Even though it is not possible to completelyeliminate various risks associated with the business of the Company the efforts are madeto minimize the impact of such risks on the operations of the Company. The Company hasestablished a well-defined process of risk management which includes identificationanalysis and assessment of various risks measurement of probable impact of such risksformulation of the risk mitigation strategies and implementation of the same so as tominimize the impact of such risks on the operations of the Company. The Company has put inplace various internal controls for different activities so as to minimize the impact ofvarious risks. The Company's approach to addressing the business risk is comprehensive andincludes periodic review of such risks and a framework for mitigating controls andreporting mechanism of such risks. The risk management framework is reviewed periodicallyby the Board of Directors for its effectiveness and compliances.

The discussion on risks and concerns are covered in the Management Discussion andAnalysis Report which forms part of this Report.

VIGIL MECHANISM

Your Company has framed a Vigil Mechanism to report genuine concerns or grievances ofall directors and employees. It provides for adequate safeguards against victimization ofpersons who use such mechanism. The Vigil Mechanism Policy has been hosted on the websiteof the Company i.e. www.srmtl.com.

CODE OF CONDUCT

The Board of Directors has adopted the Code of Conduct for the Directors and SeniorManagement and the same has been placed on the Company's website. All the Board membersand the senior management have affirmed compliance with the Code of conduct for the yearunder review.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with all the applicable provisions of Secretarial Standard onMeetings of Board of Directors (SS-1) Revised Secretarial Standard on General Meetings(SS-2) Secretarial Standard on Dividend (SS-3) Secretarial Standard on Report of theBoard of Directors (SS-4) respectively issued by Institute of Company Secretaries ofIndia.

PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE

The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on Prevention Prohibition and Redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and rules framed thereunder. Internal ComplaintsCommittee (ICC) is in place to redress complaints received regarding sexual harassment.During FY 2021-22 the Company has not received any complaint on sexual harassment ofwomen at work place.

OTHER DISCLOSURES

1) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

2) Composite Scheme of Compromise and Arrangement:

The Company had filed the Scheme of Arrangement and Compromise with the FinancialInstitutions/ Banks and Shareholders and it was approved by majority of Shareholders andlenders. The said scheme was dismissed by the single bench of Hon'ble High Court ofGujarat vide its order dated July 15 2015.

The Company had filed an O.J appeal with the division bench of Hon'ble High Court ofGujarat which has been dismissed vide its order dated February 20 2020 and the Companyhas filed Review Application on 02/11/2020 before Hon'ble High Court of Gujarat againstthe said order.

3) Execution of Settlement Agreement with Lenders for waiver of interest etc.:

The Company has made borrowings in the form of loans debentures etc. in earlier yearswhich are under settlement under the Scheme of Arrangement and Compromise. The accumulatedinterest on such borrowings is not provided for past several years. Your Company hasentered into a Settlement Agreement with certain lenders for waiver of interest and othercharges as may be applicable subject to repayment of principal amount with respect tosuch loans and debentures on or before 31st July 2022 or such other extendeddate permitted by the lenders at their sole discretion.

4) Settlement/ Waiver of Dividend Component Accumulated on outstanding CumulativeRedeemable Preference Shares:

The Company had issued 1000000 15% cumulative preference shares of face value of ?100each ("Preference Shares") in earlier year and out of which balance 666666Preference Shares ("Outstanding Preference Shares") amounting to Rs.6.67 Croresare yet to be redeemed which are under settlement under the Scheme of Arrangement andCompromise. During the year under review your Company has entered into settlement/waiverwith the Preference Shareholder who has waived the right to receive the dividendaccumulated on the Preference Shares and accumulated interest on delayed payment providedthat the Company redeems the outstanding preference shares by 31st July 2022or such other extended date permitted by the Preference Shareholder at his solediscretion.

5) Raising of Funds Through Rights Issue:

The company has an outstanding debt of Rs.61.72 Crore being the principal amount ofTerm Loan of Rs.25 Crore Redeemable Non-Convertible Debentures of Rs.36.72 crore.Further the company has also outstanding preference shares of Rs.6.67 Crore which are yetto redeemed. In this regard the Company had previously initiated settlement with thelenders of the loan and debentures including preference shareholder as per the Scheme ofArrangement and

Compromise. The liabilities towards interest/dividend /penalties/other due on thesedebts/ preference shares have increased considerably therefore in order to reduce thedebts/ liabilities your Board of Directors vide its meeting held on 21st May2022 has proposed to raise the funds through issue of equity shares on Rights Issue basisto the existing equity shareholders of the Company for the amount up to Rs.80 Crores torepay the borrowings and redemption of principal amount of preference shares insupersession of earlier resolution for raising of funds vide its meeting held on 12thNovember 2020. The company is under process of finalizing the Draft Letter of Offer forthe said proposed issue.

6) Approval of Listing permission of 4555555 equity shares of Rs.5/- each issuedpursuant to preferential allotment of convertible warrants on the Stock Exchanges (BSENSE)

The Company had earlier issued warrants pursuant to preferential issue to be convertedinto equivalent equity shares and the listing for 4555555 equity shares of Rs.5/- each wasunder process with the Stock Exchanges. Your directors are pleased to inform that theCompany has received listing approval for 4555555 equity shares of Rs.5/- each on April28 2022 and May 02 2022 from BSE and NSE respectively. The Company is under process forobtaining necessary trading permission from the Stock Exchanges.

APPRECIATION

Your Directors place on record their sincere appreciation for the continuedco-operation and support extended to the Company by various Banks. Your Directors alsothank the Consumers for their patronage to the Company's products. Your Directors alsoplace on record sincere appreciation of the continued hard work put in by the employees atall levels. The Directors also thank the Company's vendors investors businessassociates Stock Exchanges Government of India State Government and various departmentsand agencies for their support and co-operation.

For Shree Rama Multi-Tech Limited

Place: Moti-Bhoyan Shailesh K. Desai Hemal R. Shah
Date: May 212022 Managing Director Whole Time Director
(DIN: 01783891) (DIN:07338419)

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