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Sharda Cropchem Ltd.

BSE: 538666 Sector: Agri and agri inputs
NSE: SHARDACROP ISIN Code: INE221J01015
BSE 00:00 | 16 Aug 294.05 0.20
(0.07%)
OPEN

289.60

HIGH

299.45

LOW

289.60

NSE 00:00 | 16 Aug 292.60 -1.05
(-0.36%)
OPEN

292.00

HIGH

294.00

LOW

290.00

OPEN 289.60
PREVIOUS CLOSE 293.85
VOLUME 70
52-Week high 420.00
52-Week low 259.80
P/E 18.47
Mkt Cap.(Rs cr) 2,653
Buy Price 286.00
Buy Qty 1.00
Sell Price 294.05
Sell Qty 46.00
OPEN 289.60
CLOSE 293.85
VOLUME 70
52-Week high 420.00
52-Week low 259.80
P/E 18.47
Mkt Cap.(Rs cr) 2,653
Buy Price 286.00
Buy Qty 1.00
Sell Price 294.05
Sell Qty 46.00

Sharda Cropchem Ltd. (SHARDACROP) - Director Report

Company director report

To

The Members of

M/s. SHARDA CROPCHEM LIMITED

Your Directors have pleasure in presenting their report and audited accounts for theyear ended March 31 2019.

FINANCIAL PERFORMANCE:

Standalone Consolidated
Particulars FY 2019 FY 2018 FY 2019 FY 2018
Revenue from operations (net) 160706.52 146997.69 200114.28 170658.86
Other income 5131.24 2477.94 1792.27 806.78
Total Income 165837.76 149475.63 201906.55 171465.64
Expenses excluding interest depreciation and amortisation expenses 133426.57 112991.56 167625.46 135266.68
Depreciation and amortization expenses 9925.64 6979.72 9939.38 6993.93
Finance cost 822.39 482.53 839.21 486.00
Profit before tax (PBT) 21663.16 29021.82 23502.50 28718.95
Tax Expense 7260.56 9683.10 5868.17 9641.64
Net Profit for the year 14402.60 19338.72 17634.33 19077.31
Other Comprehensive Income 6.29 (3.59) 883.51 232.8
Total Comprehensive Income 14408.89 19335.13 18517.84 19310.11

OPERATIONAL PERFORMANCE & FUTURE OUTLOOK:

Your Company achieved an all time performance high in terms ofoperating revenues. The Company's consolidated revenue from operations increased by17.26% to र 200114.28 Lakhs in FY 2019. This was possible on account of strong growth inthe NAFTA and Europe regions due to new registrations. Your Company has 2297registrations as at March 31 2019.

In FY2019 Gross margins and EBITDA margins (excluding IntangibleAssets & Intangible Assets under Development write off impact) were marginally lowerat 30.7% and 18.6% respectively on account of higher procurement cost and supplyconstraints in China due to the clamp on manufacturers in view of environment issues.Depreciation and amortisation expense was higher due to high capitalisation onregistrations cost. PAT declined by 7.56% from last year mainly due to writeoff ofIntangible Assets & Intangible Assets under Development & higher depreciation thecompany declared a Consolidated PAT of र 17634.33 Lakhs.

Your Company shall continue to focus on investment in productregistrations in developed countries and high growth agricultural driven economies. YourCompany strongly believes that the future of agrochemicals business is in obtaining earlyproduct registrations due to the high entry barrier for new entrants.

CHANGE IN NATURE IN BUSINESS:

There is no change in the business activity of the Company.

MATERIAL CHANGES OR COMMITMENTS:

There are no material changes or commitments that took place after theclosure of FY 2018-19 till date which will have any material or significant impact on thefinancials of the Company.

TRANSFER TO RESERVES:

The Board of Directors have decided to retain the entire amount ofprofits for FY 2018-19 in the profit and loss account.

DIVIDEND:

During the year your Directors declared an interim dividend of र2.00 per share in their Board of Directors meeting dated January 24 2019 on the paid-upequity shares of the Company. Your directors have recommended a final dividend of र 2.00per share on the paid-up equity shares of the Company for the Financial Year ended March31 2019 which if approved at the ensuing Annual General Meeting will be paid to allthose equity shareholders of the Company whose names appear in the register of members ason record date.

The aggregate amount of Interim Dividend Distributed is र 1804.41Lakhs excluding Dividend Distribution Tax (DDT).

The final dividend on equity shares if approved by the members wouldinvolve a cast outflow of र 1804.41 Lakhs excluding DDT. The total dividend on equityshares for FY 18-19 would aggregate र 3608.82 Lakhs excluding DDT.

DIVIDEND DISTRIBUTIION POLICY:

Regulation 43A of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 ("LODR") requires top 500 listed companiesbased on the market capitalization to formulate Dividend Distribution Policy. Incompliance of the said requirement the Company has formulated its Dividend DistributionPolicy. The Policy is uploaded on the website of the Company viz.: http://www.shardacropchem.com/policy.html

SHARE CAPITAL:

The paid up equity share capital of the Company as on March 31 2019was र 9022.05 Lakhs. During the year under review the Company has not issued any shares.The Company has not issued shares with differential voting rights. It has neither issuedemployee stock options nor buy-back nor sweat equity shares and does not have any schemeto fund its employees to purchase the shares of the Company.

Further during the year under review the promoters have notacquired/sold any shares of the Company.

DEPOSITS:

Your Company has not accepted/invited deposits from the public fallingwithin the ambit of Section 73 of the Companies Act 2013 and The Companies (Acceptance ofDeposits) Rules 2014.

During the year the Company had taken loan from the promoter directorsand the promoter directors have given necessary declarations as required. The same hasbeen repaid during the year.

SUBSIDIARY COMPANIES:

SUBSIDIARY COMPANIES - DIRECT

Axis Crop Science Private Limited

Axis Crop Science Private Limited is engaged in marketing anddistribution of agrochemicals in India. For the year ended March 31 2019 theCompany's total income is र 853.72 Lakhs (Previous year: र 1429.94 Lakhs) and Lossfor the year is र 7.57 Lakhs (Previous year: र 20.77 Lakhs).

Nihon Agro Service Kabushiki Kaisha

Nihon Agro Service Kabushiki Kaisha is engaged in the business ofdealing in agrochemical products in Japan. For the year ended March 31 2019 the Companydo not have any income i.e total income for the year is Nil (Previous Year: Nil) and lossfor the year is र 0.44 Lakhs (Previous Year: र 0.17 Lakhs).

Sharda Agrochem Dooel Skopje Macedonia

Sharda Agrochem Dooel Skopje is engaged in the business of dealing inagrochemical products in Mecedonia. For the year ended December 31 2018 theCompany's total income is र 0.03 Lakhs (Previous Year: Nil) and Loss for the year isर 0.06 Lakhs (Previous Year: र 0.25 Lakhs).

Sharda Balkan Agrochemicals Limited Greece

Sharda Balkan Agrochemicals Limited is engaged in the business ofdealing in agrochemical products in Greece. For the year ended December 31 2018 theCompany's total income is र 6.79 Lakhs (Previous Year: र 4.13 Lakhs) and Loss for theyear is 0.85 Lakhs. (Previous Year: Nil).

Sharda Costa Rica SA Costa Rica

Sharda Costa Rica SA is engaged in the business of dealing inagrochemical products in Costa Rica. During the year there were no operations in theCompany.

Sharda Cropchem Espana S.L. Spain

Sharda Cropchem Espana S.L. is engaged in the business of distributionof agrochemical products in Spain and abroad. For the year ended March 31 2019 theCompany's total income is र 7191.95 Lakhs (Previous year: र 5216.61 Lakhs)and Profit for the year is र 29.26 Lakhs (Previous year: Loss र 66.50 Lakhs).

Sharda Cropchem Israel Limited Israel

Sharda Cropchem Israel Limited is engaged in the business of dealing inagrochemical products in Israel. During the year there were no operations in the Company.

Sharda Cropchem Tunisia SARL Tunisia

Sharda Cropchem Tunisia SARL is engaged in the business of dealing inagrochemical products in Tunisia. For the year ended December 31 2018 the Company'stotal income is र 0.12 Lakhs (Previous Year: 0.16 Lakhs) and Loss for the year is र 0.10Lakhs (Previous Year: Profit 0.03 Lakhs).

Sharda De Guatemala S.A. Guatemala

Sharda De Guatemala S.A. is engaged in the business of dealing inagrochemical products in Guatemala. During the year there were no operations in theCompany.

Sharda Del Ecuador CIA. Ltda. Ecuador

Sharda Del Ecuador CIA. Ltda. is engaged in the business of dealing inagrochemical products in Ecuador. For the year ended December 31 2018 Company'stotal income is र 25.08 Lakhs (Previous Year: र 32.45 Lakhs) and Profit for the year isNIL (Previous year: र NIL).

Sharda Do Brasil Comercio De Produtos Quimicos E Agroquimicos LtdaBrazil

Sharda Do Brasil Comercio De Produtos Quimicos E Agroquimicos Ltda isengaged in the business of dealing in agrochemical products in Brazil. During the yearended December 31 2018 the Company's total income is र 16.20 Lakhs (Previous Year:Nil) and Profit for the year is र 14.66 Lakhs (Previous year: Loss र 14.13 Lakhs).

Sharda Dominicana S.R.L. Dominican Republic

Sharda Dominicana S.R.L is engaged in the business of dealing inagrochemical products in Dominican Republic. During the year there were no operations inthe Company.

Sharda EL Salvador S. A. DE CV EL Salvador

Sharda EL Salvador S.A. DE CV is engaged in the business of dealing inagrochemical products in EL Salvador. During the year there were no operations in theCompany.

Sharda Hellas Agrochemicals Limited Greece

Sharda Hellas Agrochemicals Limited is engaged in the business ofdealing in agrochemical products in Greece. For the year ended December 31 2018 theCompany's total income is र 6.91 Lakhs (Previous Year: र 4.13 Lakhs) and Loss for theyear is र 0.73 Lakhs (Previous year: र NIL).

Sharda Hungary Kft Hungary

Sharda Hungary Kft is engaged in the business of dealing inagrochemical products in Hungary and abroad. For the year ended March 31 2019 theCompany's total income is र 6768.98 Lakhs (Previous year: र 6716.96 Lakhs) andProfit for the year is र 9.80 Lakhs (Previous year: र 276.67 Lakhs).

Sharda International DMCC U.A.E.

Sharda International DMCC is engaged in trading in agrochemicalsconveyor belts and chemicals. For the year ended March 31 2019 the Company's totalincome is र 35348.62 Lakhs (Previous year: र 23600.84 Lakhs) and Profit for the year isर 5543.77 Lakhs (Previous year: र 3881.59 Lakhs).

Sharda Italia SRL Italy

Sharda Italia SRL is engaged in the business of dealing in agrochemicalproducts in Italy. For the year ended March 31 2019 the Company's total income is र1624.44 Lakhs (Previous Year: र 809.00 Lakhs) and Loss for the year is र 37.16Lakhs (Previous year: Profit र 74.40 Lakhs).

Sharda Peru SAC Peru

Sharda Peru SAC is engaged in the business of dealing in agrochemicalproducts in Peru. For the year ended December 31 2018 the Company's total income isर 325.65 (Previous Year: Nil) and Profit for the year is र 268.76 Lakhs (Previous year:Loss र 54.67 Lakhs).

Sharda Poland SP. ZO.O Poland

Sharda Poland SP. ZO.O. is engaged in the business of distribution ofagrochemical products in Poland and abroad. For the year ended March 31 2019 theCompany's total income is र 3930.63 Lakhs (Previous year: र 3966.75 Lakhs) andProfit for the year is र 218.16 Lakhs (Previous year: र 124.90 Lakhs).

Sharda Polska SP. ZO.O. Poland

Sharda Polska SP. ZO.O. is engaged in the business of dealing inagrochemical products in Poland. For the year ended December 31 2018 the Company'stotal income is र 1.52 Lakhs (Previous Year: र 4.07 Lakhs) and Loss for the year isर 2.79 Lakhs (Previous year: Profit र 0.11 Lakhs).

Sharda Spain S.L. Spain

Sharda Spain S.L. is engaged in the business of dealing inagrochemical products in Spain. For the year ended December 31 2018 the Company'stotal income is र 4.68 Lakhs (Previous Year: र 7.02 Lakhs) and Profit for the yearis र 3.68 Lakhs (Previous year: Loss र 0.33 Lakhs).

Sharda Swiss SARL Switzerland

Sharda Swiss SARL is engaged in the business of dealing in agrochemicalproducts in Switzerland. For the year ended December 31 2018 the Company's totalincome is र 3.04 Lakhs (Previous Year: र 1.07 Lakhs) and Loss for the year is र 0.35 Lakhs(Previous year: र 0.08 Lakhs).

Sharda Taiwan Limited Taiwan

Sharda Taiwan Limited is engaged in the business of dealing inagrochemical products in Taiwan. During the year there were no operations in the Company.

Sharda Ukraine LLC Ukraine

Sharda Ukraine LLC is engaged in the business of dealing inagrochemical products in Ukraine. For the year ended December 31 2018 the Company'stotal income is र 6.83 Lakhs (Previous Year: र 7.02 Lakhs) and Profit for the year is र0.03 Lakhs (Previous year: र 0.05 Lakhs).

Sharda USA LLC USA

Sharda USA LLC is engaged in the business of dealing in agrochemicalproducts in USA. During the year there were no operations in the Company.

Shardacan Limited Canada

Shardacan Limited is engaged in the business of dealing in agrochemicalproducts in Canada. During the year there were no operations in the Company.

Shardaserb DO.O. Serbia

Shardaserb DO.O. is engaged in the business of dealing in agrochemicalproducts in Serbia. For the year ended December 31 2018 the Company's total incomeis र 4.44 Lakhs (Previous Year: र 2.66 Lakhs) and Profit for the year is र 0.26Lakhs (Previous year: Loss र 0.27 Lakhs).

Sharzam Limited Zambia

Sharzam Limited is engaged in the business of dealing in agrochemicalproducts in Zambia. During the year there were no operations in the Company.

Sharda Private (Thailand) Limited Thailand

Sharda Private (Thailand) Limited is engaged in the business of dealingin agrochemical products in Thailand. For the year ended March 31 2019 theCompany's total income is र 387.59 Lakhs (Previous Year: र 96.08 Lakhs) and Profitfor the year is र 5.29 Lakhs (Previous year: Loss र 8.96 Lakhs).

Sharda Morocco SARL Morocco

Sharda Morocco SARL is engaged in the business of dealing inagrochemical products in Morocco. During the year there were no operations in the Company

SUBSIDIARY COMPANIES – INDIRECT

Euroazijski Pesticidi d.o.o. Croatia

Euroazjiski Pesticidi d.o.o. is engaged in the business of dealing inagrochemical products in Croatia. For the year ended March 31 2019 the Company'stotal income is र 58.89 Lakhs (Previous Year: र 23.29 Lakhs) and Profit for the year is र19.14 Lakhs (Previous year: Loss र 4.93 Lakhs).

Sharda Benelux BVBA Belgium

Sharda Benelux BVBA is engaged in the business of dealing inagrochemical products in Belgium. For the year ended December 31 2019 the Company'stotal income is र 2.02 Lakhs (Previous Year: र Nil) and Profit for the year is र 1.54Lakhs (Previous year: Loss र 0.58 Lakhs).

Sharda Bolivia SRL Bolivia

Sharda Bolivia SRL is engaged in the business of dealing inagrochemical products in Bolivia. For the year ended March 31 2019 the Company'stotal income is 0.14 Lakhs (Previous year: र 0.15 Lakhs) and Loss for the year is र1.03 Lakhs (Previous year: र 2.96 Lakhs).

Sharda Colombia S.A.S. Colombia

Sharda Colombia S.A.S. is engaged in the business of distribution ofagrochemical products in Colombia and abroad. For the year ended March 31 2019 theCompany's total income is र 885.39 Lakhs (Previous year: र 819.06 Lakhs) and Profitfor the year is र 7.95 Lakhs (Previous year: र 39.67 Lakhs).

Sharda De Mexico S. De Rl De CV Mexico

Sharda De Mexico S. De Rl De CV is engaged in the business ofdistribution of agrochemical products in Mexico and abroad. For the year ended March 312019 the Company's total income is र 6079.36 Lakhs (Previous year: र5132.09 Lakhs) and Loss for the year of र 693.86 Lakhs (Previous year: र 693.33 Lakhs).

Sharda Europe BVBA Belgium

Sharda Europe BVBA is engaged in the business of dealing inagrochemical products in Belgium. For the year ended March 31 2019 the Company'stotal income is र 6.32 Lakhs (Previous Year: र 10.31 Lakhs) and Profit for the year is र4.29 Lakhs (Previous year: र 7.16 Lakhs).

Sharda International Africa (Pty) Limited South Africa

Sharda International Africa (Pty) Limited is engaged in the business ofdealing in agrochemical products in South Africa. For the year ended March 31 2019 theCompany's total income is र 418.40 Lakhs (Previous year: र 803.04 Lakhs) and Loss forthe year is र 70.98 Lakhs (Previous year: Profit र 173.58 Lakhs).

Sharda Malaysia SDN BHD Malaysia

Sharda Malaysia SDN BHD is engaged in the business of dealing inagrochemical products in Malaysia. For the year ended March 31 2019 the Company'stotal income is र 2.05 Lakhs (Previous Year: र 2.47 Lakhs) and Profit for the yearis र 0.17 Lakhs (Previous year: Loss र 0.32 Lakhs).

Sharpar S.A. Paraguay

Sharpar S.A. is engaged in the business of dealing in agrochemicalproducts in Paraguay. For the year ended December 31 2018 the Company's totalincome is र 12.59 Lakhs (Previous Year: र 12.56 Lakhs) and Profit for the year is र 0.86Lakhs (Previous year: र 0.32 Lakhs).

Siddhivinayak International Limited U.A.E.

Siddhivinayak International Limited is engaged in the business oftrading and investments in U.A.E. and abroad. For the year ended March 31 2019 theCompany's total income is र 1.50 Lakhs (Previous Year: Nil) and Loss for the year isर 12.21 Lakhs (Previous year: र 4.08 Lakhs).

Sharda Uruguay S.A

During the year Sharda Uruguay S.A has been dissolved with effect from4th October 2018.

Statement containing salient features of the Financial Statement ofSubsidiary Companies pursuant to Section 129(1) of the Companies Act read with rule 5 ofthe Companies (Accounts) Rules 2014 is attached as Annexure – 1.

MATERIAL SUBSIDIARY

The Company does not have any Material Indian Subsidiary as per theparameters laid down by the Companies Act 2013. The Policy on Material Subsidiary isuploaded on the Company's website viz. http://www.shardacropchem.com/policy.html.

RELATED PARTY TRANSACTIONS

All Related Party Transactions entered into during the Financial Yearwere on an arm's length basis and were in the ordinary course of business. There areno materially significant Related Party Transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee.The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website viz. http://www.shardacropchem.com/policy.html

Since all the Related Party Transactions entered into by the Companyare in the ordinary course of business and on arm's length basis Form AOC-2 is notapplicable to the Company. None of the Directors has any pecuniary relationship ortransactions vis-a-vis the Company.

DIRECTORS

As on March 31 2019 the Company has Eight (8) Directors consisting ofFour (4) Independent Directors Three (3) Executive Directors and One (1) Chairman &Managing Director.

Appointment/Resignations from the Board of Directors

Your Company has appointed Ms. Sonal Desai vide circular resolutiondated March 28 2019 as an Additional Director of the Company for a period of five yearswith effect from April 01 2019 subject to the approval of the members at the ensuingAGM. She holds office upto the date of the ensuing AGM and a Notice under Section 160(1)of the Companies Act has been received from a member signifying the intention to proposeher appointment as an Independent Director of the Company.

In terms of Section 149 152 read with Schedule IV and all otherapplicable provisions of the Companies Act 2013 and the Companies (Appointment andQualification of Directors) Rules 2014 (including any statutory modifications orre-enactment thereof for the time being in force) Mr. M. S. Sundara Rajan Mr. ShitinDesai Mr. Shobhan Thakore & Mr. P. R. Srinivasan the Independent Director's ofthe Company were appointed for a term of five years and are not liable to retire byrotation.

However their first term will expire on August 08 2019 and they areeligible for re-appointment for another period of five years. Nomination &Remuneration Committee and Board of Directors at their meeting held on May 14 2019 hadapproved their reappointment subject to the approval of the members at the ensuing AGM.However Mr. P. R. Srinivasan has shown his unavailability for re-appointment.

The Company has received declarations from the Independent Directorsconfirming that they meet with the criteria of independence as prescribed under Section149(6) of the Companies Act 2013 and under Regulation 16(b) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (hereinafter referred to as"SEBI Regulations").

Woman Director

Your Company's Board is represented by two Woman Directors Mrs.Sharda R. Bubna and Ms. Sonal Desai (appointed as an Additional Director w.e.f. April 012019).

Directors Retiring by Rotation

In accordance with the provision of Section 152 of the Companies Act2013 and Articles of Association of the Company Mr. Manish R. Bubna (DIN: 00137394)Executive Director of the Company retire by rotation at the ensuing Annual GeneralMeeting of the Company and being eligible offers himself for re-appointment.

The information of Directors seeking appointment/re-appointment asrequired pursuant to Regulation 36(3) of the SEBI Regulations is provided in the noticecovering the Annual General Meeting of the Company.

None of the Directors on the Board of the Company has been debarred ordisqualified from being appointed or continuing as directors of Companies by theSecurities and Exchange Board of India Ministry of Corporate Affairs or any suchstatutory authority.

Appointment/Resignation of the Key Managerial Personnel

During the year Mr. Conrad Fernandes resigned as Chief FinancialOfficer (CFO) of the Company w.e.f December 31 2018. The Board on the recommendation ofthe Nomination & Remuneration Committee appointed Mr. Ashish Lodha as Chief FinancialOfficer (CFO) of the Company w.e.f January 18 2019.

In terms of Section 2(51) and Section 203 of the Companies Act the following are theKMPs of the Company:

Mr. Ramprakash V. Bubna Chairman & Managing Director

Mrs. Sharda R. Bubna Whole-time Director

Mr. Ashish R. Bubna Whole-time Director

Mr. Manish R. Bubna Whole-time Director

Mr. Ashish Lodha Chief Financial Officer

Mr. Jetkin Gudhka Company Secretary & Compliance Officer

Number of Meetings of the Board

Regular meetings of the Board are held to discuss and decide on variousbusiness policies strategies and other businesses. Due to business exigencies certainbusiness decisions are taken by the Board through circulation from time to time.

The Board met five times during the FY 2018-19 viz May 09 2018 June25 2018 July 30 2018 October 31 2018 and January 24 2019.

Detailed information on the meetings of the Board are included in thereport on Corporate Governance which forms part of this Annual Report.

COMMITTEES OF THE BOARD

Your Company has several committees which have been established as apart of the best corporate governance practices and are in compliance with therequirements of the relevant provisions of laws and statutes applicable to the Company.

The Company has following Committees namely:

1. Audit Committee;

2. Nomination and Remuneration Committee;

3. Stakeholders' Relationship Committee;

4. Corporate Social Responsibility Committee.

The details with respect to the composition powers roles terms ofreference etc. of the aforesaid committees are given in details in the "Report onCorporate Governance" of the Company which forms part of the Annual Report.

PERFORMANCE EVALUATION OF THE BOARD

In compliance with the provisions of the Companies Act 2013 andRegulation 25(4)(a) of the SEBI Regulation annual performance evaluation of the Board andits Directors individually was carried out. Various parameters such as the Board'sfunctioning composition of its Board and Committees execution and performance ofspecific duties obligations and governance were considered for evaluation.

The performance evaluation of the Board as a whole was carried out bythe Independent Directors. The performance evaluation of each Independent Director wasalso carried out by the Board.

There are no observations which are carried by any of the director onevaluation of Board. Further in the view of previous year's observation company hastaken various steps as suggested by the directors.

FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

Pursuant to the SEBI regulations the Company has worked out aFamiliarization programme for the Independent Directors with a view to familiarize themwith their role rights and responsibilities in the Company nature of Industry in whichthe Company operates business model of the Company etc.

Through the Familiarization programme the Company apprises theIndependent Directors about the business model corporate strategy business plans andoperations of the Company. Directors are also informed about the financial performanceannual budgets internal control system statutory compliances etc. They are alsofamiliarized with Company's vision core values ethics and corporate governancepractices.

Details of Familiarization programme of Independent Directors with theCompany are available on the website of the Company http://www.shardacropchem.com/announcement.html

CORPORATE SOCIAL RESPONSIBILITY (CSR)

As required by Section 135 of the Companies Act 2013 the Company isrequired to spend र 69516405/- towards CSR activities out of which र 57348593/- isfor the current year i.e for Financial Year 2018-19 and र 12167811/- is towards unspentamount of Financial Year 2017-18.

During the year the Company has spent र 69596785/- towards CSRactivities.

The CSR initiatives taken up by the Company are in the areas ofpromoting education medical relief eradicating hunger empowerment of women animalwelfare promotion of Olympic sports and rural development projects. These projects are inaccordance with the activities included in Schedule VII of the Companies Act 2013 and theCompany's CSR Policy. The Annual Report on CSR activities forms a part of this Reportas Annexure - 2

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal control system. All these controls wereoperating effectively during the year.

The Company has adequate internal financial controls. During the yearsuch controls were tested to find out any weaknesses in them. Services of professionalconsultants were obtained to remove such weaknesses and ensure robust internal financialcontrols and to ensure that these controls are operating effectively.

The Company is complying with all the applicable Indian AccountingStandards (Ind AS). The accounting records are maintained in accordance with generallyaccepted accounting principles in India. This ensures that the financial statementsreflect true and fair financial position of the Company.

RISK MANAGEMENT POLICY

The Company has adopted a Risk Management Policy wherein all materialrisks faced by the Company are identified and assessed. The Risk Management frameworkdefines the risk management approach of the Company and includes collective identificationof risks impacting the Company's business and documents their process ofidentification mitigation and optimization of such risks. The Policy is uploaded on thewebsite of the Company viz.: http:// www.shardacropchem.com/policy.html

REMUNERATION POLICY

The Company's Remuneration Policy has been disclosed in the Reporton Corporate Governance which forms part of the Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS AND BUSINESS RESPONSIBILITY

The Management Discussion and Analysis Report & the BusinessResponsibility Report for the year under review as stipulated under SEBI Regulationsforms part of the Annual Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy to report genuineconcerns or grievances and to deal with instances of fraud and mismanagement. TheWhistleblower Policy has been posted on the Company's website athttp://www.shardacropchem.com/policy.html

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE(PREVENTION PROHIBITOON AND REDRESSAL) ACT 2013

The Company has in place a policy for Prevention of Sexual Harassmentin line with the requirements of The Sexual Harassment of Women at the Workplace(Preservation Prohibition & Redressal) Act 2013. Complaints Committee has been setup to redress complaints received regarding sexual harassment. All employees are coveredunder this policy. This Policy has been uploaded on the website of the Company athttp://www.shardacropchem.com/ policy.html. The Company has not received any complaint ofsexual harassment during the Financial Year 2018-2019.

AUDITORS

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act 2013read with the Companies (Audit and Auditors) Rules 2014 M/s. B S R & Associates(Firm No. 116231W/ W-100024) Chartered Accountants were appointed as the StatutoryAuditor of the Company to hold office from the Conclusion of the 15th Annual GeneralMeeting until the conclusion of the 20th Annual General Meeting of the Company subject toratification of their appointment at every Annual General Meeting.

The Statutory Auditor have submitted a certificate stating that theirappointment is in accordance with Section 139 read with Section 141 of the Companies Act.

The Audit Report forms a part of the Annual Report and the report doesnot contain any qualification reservation adverse remark or disclaimer.

b) Internal Auditor

Pursuant to the provisions of Section 138 of the Companies Act and theCompanies (Accounts) Rules 2014 on the recommendation of the Audit Committee M/s.Bathiya & Associates LLP were appointed by the Board of Directors to conduct internalaudit reviews for the Company.

c) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act 2013read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 the Company had appointed M/s. KJB & CO LLP a firm of Company Secretaries inPractice to conduct the Secretarial Audit of the Company for the Financial Year 2018-19.The Secretarial Audit Report is annexed to this report as Annexure – 3.

Reply to the qualification in Secretarial Report:

a) The Board of Directors in their report for the Financial Year2017-2018 inadvertently failed to comment on one of the observations raised by theSecretarial Auditor and the same has been qualified by the Auditor in their report for theFinancial Year 2018-2019.

b) The Company had proposed re-appointment of Chairman & ManagingDirector and Whole-Time Directors at their 15th Annual General Meeting held on August 302018. The Whole-Time Directors are liable to retire by rotation at every Annual GeneralMeeting. Due to their re-appointment the Company has not considered any retire byrotation for any of the Whole-Time Directors at the 15th Annual General Meeting.

CORPORATE GOVERNANCE

Your Company is committed to achieve the highest standards of CorporateGovernance and adheres to the Corporate Governance requirements set by the Regulators. Aseparate section on Corporate Governance practices followed by the Company as stipulatedunder Regulation 43(3) and Schedule V of the SEBI Regulations together with a certificatefrom M/s. KJB & CO LLP a firm of Company Secretaries in Practice confirmingCompliance to the conditions as stated in Regulation 34(3) of the SEBI Regulations formspart of this Annual Report.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

Details of Loans Guarantees and Investments covered under theprovisions of Section 186 of the Companies Act 2013 and the Rules made thereunder aregiven in the notes to Financial Statements.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company prepared inaccordance with the Indian Accounting Standards ("Ind AS") applicableAccounting Standards notified under Section 133 of the Companies Act 2013 and theCompanies (Accounts) Rules 2014 as amended from time to time form part of this AnnualReport.

EXTRACT OF ANNUAL RETURN

Pursuant to Section 92 and 134(3) of the Companies Act and Rule 12 ofthe Companies (Management and Administration) Rules 2014 the extract of Annual Return inForm MGT-9 is attached as Annexure - 4.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

No significant material orders have been passed by the Regulators orCourts or Tribunals which would impact the going concern status of the Company and itsfuture operations.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) of the CompaniesAct 2013 read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 in respect of employees of the Company are given in Annexure- 5 and Annexure - 6 hereunder and forms part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the InternalStatutory and Secretarial Auditors including audit of the internal financial controlsover financial reporting by the Statutory Auditors and the reviews performed by theManagement and the relevant Board Committees including the Audit Committee the Board ifof the opinion that the Company's internal financial controls were adequate andeffective during FY 2018-19.

Accordingly pursuant to Section 134(3)(c) and 134(5) of the Companies Act the Boardof Directors to the best of their knowledge and ability confirm that:

a. In the preparation of the Annual Accounts the applicable accounting standards havebeen followed and that there are no material departures;

b. They have selected such accounting policies and applied them consistently and madejudgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;

c. They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

d. They have prepared the annual accounts on a going concern basis;

e. They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively;

f. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.

STATUTORY DISCLOSURES

1) Conservation of Energy Technology Absorption & Foreign Exchange Earnings andOutgo:

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read with theRule 8(3) of the Companies (Accounts) Rules 2014 is as follows:

A. Conservation of Energy Technology Absorption The provisions of Section 134(1)(m)read with Rule 8(3) of the Companies (Accounts) Rules 2014 are not applicable to theCompany.

B. Foreign Exchange Earnings and Outgo The foreign exchange earnings and outgo duringthe year together with comparable figures of the previous year are as stated below:

(र in Lakhs)
Particulars Year ended 31-Mar-19 Year ended 31-Mar-18
Foreign Exchange Earnings 164960.27 149159.70
Foreign Exchange Outgo 121415.98 109199.30

2) Maintenance of Cost Record:

Pursuant to Section 148 of the Companies Act the Company hasmaintained the Cost Accounting Records for FY 2018-19. The Company has received CostCompliance Certificate from M/s. N. Ritesh & Associates Cost Accountants.

3) Secretarial Standards:

The Company has complied with the applicable Secretarial Standards asamended from time to time.

4) Fraud Reporting:

During the year under review no fraud has been reported by Auditorsunder sub-section 12 of Section 143 of the Companies Act 2013.

5) MOA & AOA:

During the year under review there is no change in the Memorandum ofAssociation and Articles of Association of the Company.

6) Credit Rating:

During the year under review CRISIL has given the credit rating of"CRISIL A1+" on the short-term banking facilities of the Company.

LISTING OF THE COMPANY'S EQUITY SHARES

The equity shares of your Company are listed on The BSE Ltd. and TheNational Stock Exchange of India Ltd. There is no default in paying annual listing fees.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express deep and sinceregratitude to all the stakeholders of the Company for their confidence and patronage.

Your Directors wish to place on record their appreciation for thesupport and contribution made by the employees at all levels and also wish to thank allits customers dealers agents suppliers investors and bankers for their continuedsupport and faith reposed in your Company.

For and on behalf of Board of Directors
Ramprakash V. Bubna
Place : Mumbai Chairman & Managing Director
Date : MAY 14 2019 DIN ( : 00136568)