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Suryalakshmi Cotton Mills Ltd.

BSE: 521200 Sector: Industrials
NSE: SURYALAXMI ISIN Code: INE713B01026
BSE 00:00 | 21 Mar 51.62 -0.63
(-1.21%)
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HIGH

52.25

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NSE 00:00 | 21 Mar 51.80 -0.90
(-1.71%)
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HIGH

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LOW

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OPEN 52.25
PREVIOUS CLOSE 52.25
VOLUME 273
52-Week high 90.55
52-Week low 48.00
P/E
Mkt Cap.(Rs cr) 97
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 52.25
CLOSE 52.25
VOLUME 273
52-Week high 90.55
52-Week low 48.00
P/E
Mkt Cap.(Rs cr) 97
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Suryalakshmi Cotton Mills Ltd. (SURYALAXMI) - Director Report

Company director report

To

The members

your Directors are pleased to present their Fifty Plinth Annual Report on the businessand operations of the Company and the financial results for the year ended 31 st march2022.

Financial Results

2021-2022

2020-2021

Gross Profit before Interest & Depreciation 8505.44 3719.45
Less : Interest 2426.28 3245.48
: Depreciation & Amortisation expense 1 604.39 4030.67 1 647.80 4893.28
Profit/(Loss) before prior year Adjustment 4474.77 (1173.83)
Exceptional Items 520.31 1126.04
Profit / (Loss) before tax for the year 4995.08 (47.79)
LESS : Deferred tax liability 1558.07 (13.83)^
Profit / (Loss) after tax from continuing operations 3437.01 (33.96)
Profit / (loss) from discontinued operations (4964.18) (337.19)
Tax expense on discontinued operations (1548.82) (89.00)
Profit / (Loss) after tax from discontinued operations. (3415.36) (248.19)
Profit / (Loss) for the period 21.65 (282.15)
Other Comprehensive Income 15.87 (9.31 )
Total Comprehensive Income for the period 37.52 (291.46)
ODD : Opening other Equity 21527.39 21818.85
ADD: Share premium on allotment of Preferential Equity shares 1599.75
Sub Total 23164.66 21527.39
LESS: Dividend on Equity share capital - 0
LESS: Corporate Dividend Tax - 0
LESS: Transferred to General Reserve - 0
Profit transferred to balance sheet 23164.66 21527.39

OPERATION

The Operations for the financial year 2021-22 reflect the economic revival in thecountry folloiuing the receding Covidl9 pandemic.

The turnover at Rs.783.5Crores has improved by 60% over the previous year and profitbefore tax of Rs.49.95Crores reflects the improved performance of the spinning and denimfabric divisions. The overall groujth in sales volumes and realisations arising out of thefavourable market sentiment has contributed to the encouraging results.

POWER PLRnT

As informed in the previous report the operations of the Poujer Plant are discontinuedeven during this year as it is no longer viable to operate the same due to the shortageand high coal cost and also availability louu cost state poujer.

The Board has decided to dispose off the Poujer plant and use the sale proceeds toreduce the debt burden.

DIVIDEnD

In vieuj of the inadequate profits the Board regrets its inability to recommend adividend for the year 2021-22. The Board has decided to dispose off the Poujer plant anduse the sale proceeds to reduce the debt burden.

CAPITAL EXPEnDITURE

During the year under revieuj the Company incurred capital expenditure of Rs. 1052.37lakhs.

EXPORTS

The effects of pandemic subsided resulting in overall revival of the economic activityglobally. Exports witnessed a healthy

54% growth and the Company managed to service its clientele of leading brands like LeeUUrangler Dickies Timberland UUal- mart fimazon Gorge Primark Salisbury & Jack& Jones etc. The Company hasadded new customers like CK.Uniqlo m&S etc & newmarkets like Indonesia Syria etc.

FUTURE OUTLOOK

UUhile the performance in the Financial year 2021-22 is encouraging the gallopingcotton prices apart from rising other input costs like dyes chemicals coal & poweretc present a challenge and an opportunity to the Company. The Company will continue to doits best in the given circumstances to meet the evolving challenges.

DIRECTORS

During the year Smt. firuna Prasad {DID: 07164087) Director will retire at the ensuingfinnual General meeting and being eligible offers herself for reappointment.

During the year IDBI withdraw the nomination of Sri. V.V.S.Ravindra and nominated Sri.Rajan Ravindra Shukla instead. The Board wishes to placeon board itsappreciation of thecontinuation made by Sri.V.V.S.Ravindra to the deliberation of the Board during theTenure.

Further details about the above directors are given in the Corporate Governance Reportas well as in the notice of the ensuing finnual General meeting being sent to theshareholders along with the finnual Report.

EVfiLUfiTIOn OF THE BOARD’S PERFORrrmncE

In compliance with the Companies fict 2013 and as per the latest Listing Regulationsthe annual performance evaluation of the Board its Committees and of Individual Directorswas carried out during the year under review more details on the same are given in theCorporate Governance Report.

FRmiLIfiRISATIOn PROGRAm FOR inDEPEriDEnT DIRECTORS

The Company has formulated a familiarisation program for the Independent Directors toprovide insights into the Company to enable the Independent Directors to understand itsbusiness in depth and contribute significantly to the Company. The details of such programare available in the Company's website www.suryalakshmi.com

DECLARATIOn By InDEPEriDEnT DIRECTORS

The Company has obtained the declaration from the Independent Directors confirming thatthey meet the criteria of Independence laid down in Section 149{6) of the Companies fict2013.

ITIEETinG OF InDEPEriDEnT DIRECTORS

fi separate meeting of the Independent Directors was held under the Chairmanship of SriR.Surender Reddy Independent Director on February 2 2022 inter-alia to discussevaluation of the performance of non-independent Directors the Board as a wholeevaluation of the performance of the Chairman taking into account the views of theExecutive and nonexecutive Directors and the evaluation of the quality content andtimeliness of flow of information between the management and the Board that is necessaryfor the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of theDirectors and the Board as a whole.

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 policy also provides the criteria for determining qualifications positiveattributes and Independence of Directors and criteria for appointment of Key managerialPersonnel / Senior management and performance evaluation which are considered by thenomination and Remuneration Committee and the Board of Directors while making selection ofthe candidates. The above policy has been posted on the website of the Company at www.suryalakshmi.com.

DIRECTORS’ RESPOnSIBILITy STOTEITIEnT

your Directors state that:

(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(b) the Directors had selected such accounting policies and applied them consistentlyand made judgements 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 and ofthe profit and 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 Companies Oct 2013 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 are operatingeffectively.

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

DISCLOSURES UI1DER THE COITIPfiniES OCT 2013

i) Annual Return:

The Company's Annual Return has been hosted on Company's website and can be accessed atthe weblink www.suryalakshmi.com. Therefore the extract of Annual Return as per theprovisions of Section 92 of the Companies Act 2013 and Rule 12 of Companies (managementand Administration) Rules 2014 has not been annexed to this Board's Report.

ii) number of Board meetings:

The Board of Directors met four times during the year 2021-2022. The details of theboard meetings and the attendance of the Directors are provided in the CorporateGovernance Report.

iii) Changes in Share Capital:

During the year under review the Company made a Preferential issue of 2133000 equityshares to the Promoters of the Company under the prevailing provisions of Companies Act2013 & SEBI Regulations. The shares have been listed by BSE & nSE.

iv) Audit Committee:

The Board has constituted the Audit Committee which comprises of Sri R. Surender Reddyas the Chairman and Sri R.S.Agarwal Sri navrang Lai Tibrewal and Sri V.V.S.Ravindra (upto 30/04/2022 Sri Rajan Ravindra Shukla (from 30/04/2022) as the members more details onthe committee are given in the Corporate Governance Report.

v) Related Party Transactions:

All the related party transactions are entered into on arm's length basis and are incompliance with the applicable provisions of the Companies Act 2013 and the ListingRegulations. There are no materially significant related party transactions made by thecompany with Promoters Directors or Key managerial Personnel etc. which may havepotential conflict with the interest of the company at large. Thus disclosure in FormAOC-2 is not required to be made. All Related Party Transactions are disclosed to theAudit Committee and the Board.

Omnibus approval is obtained for the transactions which are foreseeable and repetitivein nature. A statement of all related party transactions is presented before the AuditCommittee and the Board on a quarterly basis specifying the nature value and terms andconditions of the transactions. The Related Party Transactions Policy as approved by theBoard is uploaded on the company's website at the web link:http://www.suryalakshmi.com/investor.corporate. governance.aspx

vi) 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.

vii) no Loans/Guarantees/Investments under Section 186 of the Companies Act 2013 havebeen made during the year.

viii) There were no significant and material orders passed by the Regulators/ Courtsthat would impact the going concern status of the Company and its future operations

CORPORATE GOVERnfinCE

As per the latest Listing Regulations on Corporate Governance management Discussionand Analysis Report forms part of the Annual Report (AnnEXURE - 5). The Company hascomplied with the corporate governance requirements under the Companies Act 2013 asstipulated under the Listing Regulations. A separate section on corporate governance underthe Listing Regulations along with a certificate from the auditors confirming thecompliance is annexed and forms part of the Annual Report (AnnEXURE - 1).

CORPORATE SOCIAL RESPOnSIBILITy POLICy

fit Suryalakshmi a major concern has been the sincere effort by the Company torecognize the role played by the Society at large the environment and its human resourcesin its sustainability and groujth and to strive to discharge its social responsibility asa corporate citizen. To this end the Company has always tried to strike a fine balance ofeconomic environmental and social commitments. The sustainable stewardship mantra is notlimited to philanthropy but encompasses holistic community development and otherinitiatives to strengthen business sustainability. The core areas for Suryalakshmi'sCorporate Social Responsibility (CSR) Programmes for this year have been health careenvironment and education. Details of the projects / activities implemented by the Companyare furnished in a separate finn?XUR?-2 to this report. The Company constituted aCommittee of CSR consisting of Sri L.n.figarwal Sri Paritosh figarwal and Sri R.SurenderReddy with Sri L.n.figarwal as Chairman.

STAKEHOLDERS RELATIOnSHIP commiTTEE

The reconstituted Stakeholders Relationship Committee consists of following Directors.

mr. navrang Lai Tibrewal Chairman {Independent Director} Sri L.n. figarwal {member}Sri Paritosh figarwal {member} and Sri E.V.S.V. Sarma Compliance Officer & CompanySecretary. During the financial year stakeholder's relationship committee meeting washeld on 10/05/2022.

risk mAnAGEmErrr

The Company has instituted a proper mechanism for identifying and establishing controlsto effectively manage different kinds of risks viz.. Trend Related Risks Raw materialRisks Brand / Technology Risks Operational Quality Risks Human Resources RisksRegulatory Risks and Financial Risks fi Committee headed by Sri Paritosh figarwalmanaging Director periodically reviews the risks and takes steps to mitigate identifiedrisks.

UUHISTLE BLOUUER POLICE

The Company has in place a UJhistle Blower policy for vigil mechanism for Directors andemployees to report to the management about unethical behaviour fraud violation ofCompany's Code of Conduct which also ensures safeguards against victimization of thoseemployees who

seek to make use of the free access to the fiudit Committee for this purpose none ofthe Personnel has been denied access to the audit committee. The UUhistle Blower Policyhas been posted on the website of the Company at www.suryalakshmi.com/investor-corporate-governance.aspx

DECLARATIOn ABOUT COITIPLIAnCE UUITH THE CODEOF COIIDUCT By mEITIBERS OF THE BOARD AflDSR.mAnAGEITIEnT PERSOnnEL.

The Company has complied with the requirements of Code of Conduct for Board membersandSr. management Personnel.

DISCLOSURE UnDER THE SEXUAL

HARASsmEnT OFUuomEn at uuorkplace

(PREVEnTIOn PROHIBITIOnAnD REDRESSAL) ACT 2013

The Company has in place an finti-Sexual Harassment Policy in line with therequirements of the Sexual Harassment of UJomen at UUorkplace (Prevention Prohibition andRedressal} Ret 2013. Internal Complaints Committee has been set up to redress complaintsreceived regarding sexual harassment fill employees (permanent contractual temporaryand trained) are covered under the Policy. The following is a summary of sexual harassmentcomplaints received and disposed ofduring each Calendar year:

a) no. of Complaints received - niL

b) no. of Complaints disposed off during the year - niL

c} no. of cases pending as at end of the Financial year - niL

AUDITORS

I. Statutory Auditors and their Report:-

m/s.K.S.Rao & Co. Chartered Accountants {ICfil Firm Regn.no.003109S} wereappointed as Statutory RuditorsoftheCompany fora period of five consecutive years at thefinnual General meeting {fiGITl) of the members held on 28/08/2017. The present term ofappointment of m/s.K.S.Rao&Co. Chartered Accountants comes to an end with theconclusion of this 59th RGm and in their place it is proposed to appoint m/s. Brahmayya& Co Hyderabad {ICfil Firm Regn no.000513S) for a period of 5years on a remunerationmutually agreed upon by the Board of Directors and the Statutory Auditors.

The Company has received the prescribed certificate from the Auditors regarding theappointment and the necessary consent for hisappointment as (Auditors. The Auditors'Report to the shareholders for the year under review does not contain any qualificationreservation or adverse remark

II. Cost Auditor and Cost Audit Report

Rs per the requirement of Central Government and pursuant to Section 148 of the Ret2013 read with the Companies {Cost Records and Rudit) Rules 2014 as amended from time totime your Company has required to maintain cost records and accordingly such accountsare made and records have been maintained relating to Textile Divisions every year.

Pursuant to Section 148 of the Companies Ret 2013 the Board of Directors on therecommendation of the Rudit Committee has appointed m/s. S.Hariharan & AssociatesCost Accountants (Firm Registration no.l 00486) as the Cost Auditors for the Financialyear 2022-2023 and has recommended their remuneration to the shareholders for theirratification at the ensuing Annual General meeting m/s. S.Hariharan & AssociatesCost Accountants have confirmed their appointment is within the prescribed limits and alsocertified that they are free from any disqualification.

III. Secretarial Auditor and Secretarial Audit Report

The Board had appointed ITIr.K.V.Chalama Reddy Company Secretary in UUhole-timePractice (m.no. F9268) to carry out Secretarial Rudit under the provisions of Section 204of the Companies Rct2013 for the financial year 2022-2023. The report of the SecretarialRuditor for the financial year 2021 -22 does not contain any qualifications reservationor adverse remarksand is annexed to this report as Ann?XUR? -3.

inTERnoL conTROL sysTems & their RDEQURCy

your Company has effective and adequate internal control systems in place commensuratewith the size and complexity of the organisation. Internal and operational audit iscarried by m/s.K.Vijaya Raghavan & Associates LLP a reputed firm of CharteredAccountants. The Internal Rudit system is designed to meet the statutory requirements aswell as ensure proper implementation of management and accounting controls. The internalauditors submit their report to the managing Director and also to the Rudit Committeewhich reviews the report and ensures that the Audit observations are attended to by themanagement.

consERVOTion of EnERcy TECHnoLocy PBSORPTIOn FOREICn EXCHnnCE

EORnincs oriD outgo

The Company has installed Solar Power for 3001.86 KUUP at its fimanagallu division topromote alternative source of energy information on conservation of energy technologyabsorption foreign exchange earnings and out go as required to be given pursuant toprovision of Section 134 of the Companies Act 2013 read with the Companies (Accounts)Rules 2014 is annexed here to marked Ann?XUR?-4 and forms part of this report.

DEPOSITS

The Company has not accepted any deposits from the public during the year under review.

complionce uuith secretarial

STPNDRRDS

The Company has complied with the Secretarial Standards issued by the Institute ofCompany Secretaries of India.

EMPLOYEES

Periodic Training programmes for developing a skilled workforce personalitydevelopment programmes yoga camps etc. encouragement of employee participation indistrict / state level sports events are regularly undertaken. An integrated woman focusedprogram trains unskilled women to undertake skilled jobs at its units.

Disclosure pertaining to the remuneration and other details as required under Section134 & 197(12) of the Ret and the Rules framed thereunder is enclosed as Pnn?XUR?-6to the Board's Report.

RCKNOUULEDGEMENTS

The Board of Directors are pleased to place on record their appreciation of thecooperation and support extended by Banks and various State and Central GovernmentAgencies. The Board also wishes to place on record its appreciation of the valuableservices rendered by the employees of the Company.

For and on behalf of the Board
Date : 10th may 2022 Ln.ACARUUAL
Place : Secunderabad Chairman & managing Director

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